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ELECTION

Kenya’s presidential winner to witness an in-tray full of financial affairs

by Radarr Africa August 10, 2022

written by Radarr Africa

The winner of Kenya’s presidential election will have an in-tray full of economic and political challenges to solve when he assumes office.

The polls happened in the middle of an economic crisis, with the country struggling with inflation that was at a five-year high of 8.3 percent in July on the back of costly food and fuel.

The price rises, partly fuelled by the war in Ukraine, have deepened economic problems triggered by the coronavirus pandemic, including stagnant wages and growing youth unemployment.

Opposition leader Raila Odinga and Deputy President William Ruto, neck-and-neck in the opinion polls, have each promised a solution to the cost of living problem.

The country is also grappling with soaring public debt, uncertainties over maize flour and fuel subsidies that have attracted criticism from some economists, and a shilling hit with 14 straight months of depreciation against the dollar.

The election winner also has to juggle the thorny issues of affordable education and risks of drought while keeping the economy on track.

Incoming president needs Sh3.89 billion daily to pay off Kenya ballooning debt

President Uhuru Kenyatta required an average of Sh630 million daily in 2013 to settle pubic debts inherited from his predecessor, Mwai Kibaki.

Also his successor will require nearly six times more or Sh3.89 billion daily to pay off Kenya’s ballooning debt, thanks to a borrowing binge driven by funding needs of infrastructure projects such as railways that have saddled the country with steep repayment obligations.

The government is spending more than half of taxes or Sh1.39 trillion in the year starting July on repaying debt and the interest it has accrued.

This has squeezed Kenya’s finances and denied the Treasury the funds it requires to revamp the economy and create jobs, creating a headache for Deputy President William Ruto and opposition leader Raila Odinga – the two contenders to succeed Mr Kenyatta.

ALSO READ: Kenya’s M-Pesa mobile money service offset against the risk of non-payment

Mr Odinga said he planned to renegotiate loans with a number of creditors, including China, if he won. Some loans could be converted so they had longer repayment terms and lower interest rates to free up money for new development projects, he suggested.

Dr Ruto, on the other hand, has made it clear that he is “not considering negotiating any debt”, referring to existing loans, and that he will instead broaden the tax base and cut expenditure on infrastructure projects.

Analysts reckon that both options will be hard to execute and are fraught with risks. “The best chance is to have restructuring with the bilateral creditors, but at best I think it may require renegotiating the financing terms (maturity and interest costs) to alleviate debt service costs,” said Churchill Ogutu, an economist at IC Asset Managers with a focus on East Africa.

“Multilateral lenders issue loans at concessional terms and there’s no meaningful impact in restructuring that stock of debt while Eurobonds may be difficult as it entails having discussions with heterogeneous lot of investors which is a Herculean task.”

Analysts at New York-headquartered investment banker, JPMorgan, said renegotiating terms of debt will free up more cash if the review focuses on domestic portfolio– which accounts for 72.8 percent of the annual debt repayment costs or Sh1.04 trillion. → Constant Munda

Tough conversations with Beijing on debt, SGR contract

Kenya’s next president is set for a difficult conversation with China, if the pronouncements by leading contenders Raila Odinga and William Ruto during their campaigns are anything to go by.

Both candidates dwelt on China’s economic relationship with Kenya, which has been characterised by concerns over heavy borrowing for infrastructure projects and a trade imbalance that is heavily in favour of the Asian economy.

Deputy President Ruto, speaking in June, took issue with the large number of Chinese arrivals in Kenya in recent years, particularly those engaging in informal and retail businesses that he deemed should be left to locals.

Dr Ruto hinted at the possibility of deportations, which reportedly did not go down well with the Chinese government. In a subsequent interview, he also promised to disclose the details of the closely guarded Sh477 billion standard gauge railway (SGR) contract, as well as that of the just commissioned Nairobi Expressway which has been built under a public-private partnership (PPP) plan at a cost of Sh88 billion.

The two China-funded projects are the signature infrastructure projects of President Uhuru Kenyatta, with whom Dr Ruto has fallen out politically.

Mr Odinga has promised to renegotiate the country’s external obligations, which include a significant Chinese portion.

By the end of May, Kenya owed China Sh796.5 billion, accounting for 18.5 percent of Kenya’s external debt load of Sh4.29 trillion, and 9.3 percent of total public debt which stood at Sh8.56 billion as at May 31.

The two candidates’ China plans are likely to elicit very different conversations with Beijing. Disclosing contract details that the Asian country has seemingly been keen to keep confidential, as suggested by Dr Ruto, while also instituting immigration curbs would ruffle diplomatic feathers, could attract retaliatory measures.

Mr Odinga’s hopes of softened debt terms are also likely to face headwinds, given Beijing’s reluctance in the past to retool debt repayment plans for countries such as Kenya. The Import-Export Bank of China, a major financier of the SGR, notably resisted the attempts by Kenya to get a debt payment freeze during the Covid19 period. → BD TEAM

Weak shilling poses debt service and balance of payment problems for the next Treasury boss

The Kenya shilling has this year depreciated by five percent against the US dollar to an all-time low of 119.12 units, eclipsing the 3.5 percent it shed against the greenback in the whole of 2021.

For the incoming administration, the weaker currency will have significant economic implications, especially on external debt service and fulfilling the promises of lowering the cost of living in the country.

In the 12 months to March 2022, the value of imports into the country rose by 30 percent to a record Sh2.23 trillion, outpacing export earnings which rose 16 percent to Sh756.4 billion. The country’s trade deficit therefore jumped to Sh1.47 trillion from Sh1 trillion a year earlier.

This has piled pressure on the shilling as demand for dollars has gone up significantly, leaving importers complaining of difficulties accessing hard currency to finance external obligations.

SOURCE: The Kenya wall street

August 10, 2022 0 comment

Panic Buying Hits Supermarkets In Kenya Ahead Presidential Elections

by Radarr Africa August 8, 2022

written by Radarr Africa

Panic shopping set in across Nairobi from last Friday as Kenyans braced for a hotly contested presidential polls election Tuesday.

Despite government assurances that on August 9 will cause no major disruptions to supplies, shoppers appeared to be stockpiling, given the empty shelves witnessed on many supermarket shelves. A spot check by the Business Daily in Nairobi showed many people were flocking to supermarkets and retail stores to stock up on longer-shelf-life food items such as maize flour, rice, milk, sugar, and cooking oil.

Retailers and shoppers said the rush by city residents to stockpile foodstuffs has prompted a scarcity of supplies, including the subsidised maize flour that retails at Sh100 per two-kilo packet. “We are stocking up even though we do not expect that there will be any disruption. It is just a matter of being on the safe side,” said David Kimondo, a father of two, while shopping at a retail store within the Two Rivers Mall.

However, weak economic activity has constrained emergency stocking measures by some Kenyans. ”I have only managed to buy a few essentials like cooking oil, maize flour and rice because I do not have adequate cash,” said Mary Wambui, a mother of three who shopped at a supermarket in Nairobi’s central business district (CBD).

On Friday, Business Daily encountered long lines at various retail stores in Nairobi’s CBD, including supermarkets. Some retail outlets had empty or dwindling stocks on the shelves as customers rushed to make their picks. Long queues were also witnessed in the grocery markets in Muthurwa and Marikiti fresh produce markets as shoppers bought cereals. Fuel stations also received an increased number of customers looking to stock up on cooking gas.

Kenya’s elections have often been characterised by unrest and violence, most notably in 2007 and 2017, costing businesses billions of shillings in lost earnings and damages. Some retailers, however, linked the shopping frenzy to school closure and mandatory holidays ahead of the polls.

“[Political uncertainty around the polls] is a small factor in the upsurge in shopping,” said Naivas’ chief commercial officer, Willy Kimani. Authorities last week sought to discourage panic-buying of goods ahead of Tuesday’s polls as the State would guarantee minimal disruption.

Interior Principal Secretary Karanja Kibicho said Thursday that adequate security personnel has been deployed across the country to maintain law and order before, during, and after the elections.

In May, the National Cohesion and Integration Commission listed Nairobi, Nakuru, Kericho, Kisumu, Uasin Gishu and Mombasa counties as the likeliest to experience election-related unrest, ideally giving authorities and civil groups time to roll out measures to forestall any skirmishes.

The impending closure of the retail outlets has also contributed to the panic buying. “You are hereby informed that all the 84 Naivas outlets will remain closed on 9th August 2022,” said Naivas in a notice.

“Normal operations will resume on 10th August 2022. We urge you to carry out prior shopping to be well stocked and avoid conveniences.” “Customers are buying foodstuffs across but demand for maize flour started when prices were dropped,” an attendant at one of the Naivas stores said.

Kenya is the main route for imports into Uganda, with oil from international sources delivered to Eldoret, where other Northern Corridor countries of Uganda, South Sudan, Rwanda and eastern DR Congo pick it for transportation to their markets.

While there has not been major election-related violence in the current campaigns, the ghosts of the 2007/8 violence continue to haunt importers and transporters on the Northern Corridor. On Friday, the Kenya Bankers Association (KBA) said it was assessing lower risk levels associated with the upcoming polls compared to previous ones.

KBA chief executive Habil Olaka said there is growing confidence in the country’s ability to handle political transitions without much economic disruption. Besides Naivas, Carrefour and Quickmart, the Business Daily also established a spike in purchases for fresh vegetables and meat, which are also forecast to have jumps in demand.

Shoppers say they will be snacking out of boredom at their homes while also using the foodstuffs to keep them busy watching the election results.

“I have bought the usual house shopping and snacks for boredom. I need to get popcorn for watching results,” a shopper said. At City Park Market in Parklands, Grace Wanjiru who stocks cauliflower, avocado, courgettes, carrots and broccoli, was on Friday morning adding her inventory to meet the demand she anticipated in the four days to the date of the election.

“What we have bought today (August 5) we will sell until Monday (today). We expect customers to come in large numbers and we already started to see the signs,” she said.

The grocers say farmers have cut produce transported to the markets due to anticipation of interruptions over the election period. As a result, Jack Obonyo says the price of one kilogramme of okra has increased to Sh150 from Sh100 within a week due to a shortage in supplies.

ALSO READ: State Assures Unga Of A Enough Maize Flour

The price of green chilli pepper has also increased to Sh200 a kilo from Sh150. He stocks cucumber, eggplants, Valori, French beans, and bottle and ridge gourd. “We are seeing an increasing flow of customers; I don’t know whether they are experiencing tension,’’ said John Kimathi. ”Suppliers are scared of bringing in a lot of the produce

SOURCE: Business daily

August 8, 2022 0 comment

Nigeria Politics Spotlight Western Africa

INEC officially extends Voters Registration.

by Radarr Africa July 1, 2022

written by Radarr Africa

INEC, The Independent National Electoral Commission has announced it will continue the Continuous Voter Registration and directed all Electoral Commissioners to continue the exercise pending further directives.

INEC disclosed this in a statement issued on Thursday evening.

The Commission also ordered all parties that have concluded governorship and state assembly elections to upload nominated candidates to INEC’s portal from 1st -15th July.

What INEC is saying

It said, following its meeting on Thursday, in which it discussed Voter Registration and issuance of Certified True Copies, “The Continuous Voter Registration will continue nationwide, and all Resident Electoral Commissioners and Electoral Officers have been directed to continue with the exercise pending further directives.”

It added that it has consistently reiterated its resolve to continue to provide electoral services to Nigerian people.

The Commission acknowledged the Federal High Court decision relating to the CVR, which they say they will give an update to the court.

On Certified True Copy Documents, INEC said political parties and all applicants of CTC documents will be treated expeditiously and will be issued soon, announcing that parties that have conducted valid Governorship and State Assembly primrose should upload the list and personal particulars of their monitored candidates between 1st and 15th July, 2022.

“Political parties are advised not to wait until the last day before uploading the list,” it urged.

What you should know

Following the conclusion of party primaries, there has been more turn out in the number of Nigerians trooping to registration centres.
June 30 was the scheduled deadline for the closing of the Continuous Voter Registration (CVR) exercise, however, there have been calls from various Nigerians and NGOs demanding an extension of the CVR.
Recall weeks ago, the House of Representatives directed INEC to extend the voter registration exercise by 60 days. The House gave the directive following the adoption of a motion moved by Ben Kalu (APC, Abia) during plenary on Wednesday.
On June 20, an Abuja Division of the Federal High Court restrainrd INEC from ending the voter registration on the 30th of June, 2022.
Justice Mobolaji Olajuwon gave the order sequel to an ex-parte motion filed by Socio-Economic Rights and Accountability Project (SERAP).
After granting the order, the judge adjourned until June 29, to hear the Motion on Notice for interlocutory injunction.

Source: Nairametrics

July 1, 2022 0 comment

Eastern Africa Economy Kenya

Kenya’s Business Confidence Hits Record Low as Election Nears.

by Radarr Africa June 7, 2022

written by Radarr Africa

Kenya’s business confidence continues to decline two months before the General Elections scheduled for August 8, the Stanbic Bank Purchasing Managers’ Index (PMI) has revealed, noting that the issue has further been compounded by uncertainty over the supply chain, inflation, and geopolitical tensions caused by the Ukraine-Russia war.

According to the survey which was conducted between May 12-27, business confidence registered a survey-record low for the third month running.

Only eight percent of the 400 managers of private sector companies forecasted an expansion in activity over the coming year.

“Expectations across agriculture, mining, manufacturing, construction, wholesale, retail, and services were in positive territory in May, albeit relatively subdued.” the survey noted.

Overall, the economic activity contracted for the second consecutive month in May with the PMI dropping to 48.2 from 49.5 in May; readings above 50.0 signal an improvement in business conditions from the previous month, while readings below 50.0 show a deterioration.

Kuria Kamau, Fixed Income and Currency Strategist at Stanbic Bank said the modest decline in business conditions reflected sustained falls in both output and new orders, as well as a renewed drop in employment.

The costs of producing goods and services remained at an 8-year high driven by rising fuel prices, higher taxes, and input shortages which forced many firms to scale back on output and employment levels.

The rise in output prices, in turn, led to a reduction in domestic demand as clients cut back on spending due to the rising cost of living

Already, Pwani oil the manufacturer behind the Salit Oil, Mpishi Poa, and Fresh Fry cooking oil products has announced the temporary halt of its operations citing among others the dollar shortage witnessed in the country which has taken a toll on several manufacturers.

In terms of employment, May reported a decline in employment with most firms reducing their staffing capacity amid lower sales.

“Others added to their workforces to support output and gain new customers,” the survey noted.

Source: All Africa

June 7, 2022 0 comment

Africa Politics

Intrigues as ministers develop cold feet over resignation

by Radarr Africa May 14, 2022

written by Radarr Africa

Sources at the presidency disclosed that nine of the ministers were hoping to hang on to their positions, until the president dropped the bombshell directing them to resign by Monday.

Even after President Muhammadu Buhari held a valedictory session on Friday for 10 ministers who had declared interest in elective offices, some of them are still scheming to hang on to their offices, PREMIUM TIMES’ can authoritatively report.

The president held the session for ministers who had picked the expression of interest and nomination forms to participate in the primaries of the All Progressives Congress (APC).

According to the Minister of Information and Culture, Lai Mihamned, the outgoing ministers that attended the session were Rotimi Amaechi (Transportation), Chris Ngige (Labour and Employment), Godswill Akpabio (Niger Delta Affairs), Ogbonnaya Onu (Science and Technological Innovation), Timipre Sylva State for Petroleum Resources), Tayo Alasoadura (State for Niger Delta Affairs), Pauline Tallen (Women Affairs), Uche Ogar (State for Mines and Steel Development), Abubakar Malami (Attorney General of the Federation and Minister of Justice) and Emeka Nwajuba (State for Education), who was absent but with a permission.

At the time of that event, only three of the ministers had submitted their letters of resignation.

Six of the ministers had declared interest in the presidential race, two in governorship races and two in senatorial races.

However, hours after the valedictory session, Mr Ngige issued a statement to announce his withdrawal from the presidential race and his intention to remain in his position as Minister of Labour and Employment.
In the letter, Mr Ngige said: “Today, 13th May, 2022, I had an audience with the President, Muhammadu Buhari as a follow up to the one I earlier had with him on 11th May, 2022.
“Having also consulted widely with my family, constituents, supporters and well-wishers, it is my pleasure to announce the withdrawal of my interest and earlier decision to contest the office of the President in the 2023 general elections.

“As a result of this, will NOT be participating in any of the internal party processes of the said election, starting with the primary. took this momentous decision firstly in the overall interest of the nation, in order to enable me concentrate on my job, and assist the President and the Government, whether the difficult last lap, in the life of the administration and secondly for other family reasons.

“I have since communicated this decision to the President and the Secretary to the Government of the Federation.”

Also, Mr Malami, who earlier on Friday had tweeted that he had submitted his resignation letter, later deleted the tweet, sparking speculations that he had withdrawn the letter.

Sources at the presidency disclosed that nine of the ministers were hoping to hang on to their positions, until the president dropped the bombshell directing them to resign by Monday.

According to the sources, the president was aware of their reluctance to leave and had for over a week blocked them from seeing him. The sources all asked not to be identified because of the sensitive nature of the issue.

“It is unlikely that the president will allow them back, not even Ngige who has issued a public statement on his withdrawal from the presidential race,” one of the sources said, adding, “They are just wasting their time.

“The president knew they wanted to have their cake and eat it so he waited for them to commit themselves by picking the nomination forms before asking them to leave.

“Only the Minister of State for Education, Nwajiuba, resigned on his own volition. All the others planned to keep their positions. They were relying on the provision of the Constitution which requires political appointees to leave about three months to the elections.

“The president initially gave them until Monday to resign but shocked them again by summoning them to the valedictory session on Friday, even though only a few of them had submitted their resignation letters by then.”

According to the sources, the president invited only the Minister of Information and Culture, Lai Mohammed, to the ceremony, apart from the departing ministers.

At the valedictory session on Friday, Mr. Buhari said he would be quick in appointing replacements for the departing ministers who he wished good luck in their political ambitions.

As of Friday night, sources said Mr Malami had not turned in his letter of resignation, even though he is considered favourite to pick the APC governorship ticket in Kebbi.

The former minister ignited consternation across the country after it was reported that he donated 30 Mercedes and Toyota Prado SUVs to APC officials and statutory delegates in the state.

Mr Malami had been pursuing the removal of Section 64(12) of the Electoral Act 2022 which requires political appointees to resign before they can participate as delegates or candidates in party primaries.

After a high court in Umuahia, Abia State declared the section unconstitutional, Mr Malami said he would immediately expunge it before gazzetting the Act.

However, the National Assembly appealed the judgement, following which the Court of Appeal nullified it, although it also agreed that the section is unconstitutional.

Source: Premium Times

May 14, 2022 0 comment

Politics Western Africa

Nigeria’s former president Goodluck Jonathan rejects APC nomination

by Radarr Africa May 10, 2022

written by Radarr Africa

Goodluck Jonathan, Former President of Nigeria has rejected a presidential nomination form, saying it was bought without his consent. The form was for the ruling APC All Progressive Congress, that defeated Mr. Jonathan in 2015 after he had been in power for five years

A supporters’ group bought the nomination form on his behalf on Monday, continuing the trend of aspirants using proxies to purchase the form, but a statement by the former president’s spokesman said Mr. Jonathan “was not aware of this bid and did not authorize it”.

“We want to state that if the former president wanted to contest an election, he would make his intentions clear to the public and will not enter through the back door,” it said.

Nigeria’s main political parties are expected to hold their primaries later this month to meet the election commission’s dateline of 3 June for the submission of their candidates for the February 2023 election. The form costs 100m naira (about $240,000; £195,000) to purchase the APC’s nomination papers.

Source: BBC News

May 10, 2022 0 comment

Eastern Africa Politics

Presidential candidates to address Parliament on May 11 and 12, Somali Parliament Says

by Radarr Africa May 6, 2022

written by Radarr Africa

The Somali parliament announced Thursday that the long-awaited presidential election will finally take place on May 15 and that 329 lawmakers from both houses, 54 from the Senate or Upper House and 275 from the Lower House will elect the country’s tenth president.

The presidential election date will coincide with a historic day as the country will also commemorate the 79th anniversary of the Somali Youth League formed on May 15, 1943 by 13 young activists who spearheaded the struggle for a united and independent Somalia in the 1940s and 1950s.

The committee said the presidential candidates will address Parliament on May 11 and 12 on their policies ahead of the vote. The presidential election which is 15 months behind schedule comes after Somalia concluded parliamentary elections in April.

M ohamed Abdullahi Mohamed known as Farmajo, whose term in office officially ended on February 8, 2021, has been under pressure after the election date passed without resolution of issues related to how the vote would have been conducted in Somalia.

Source: African News

May 6, 2022 0 comment