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IRENA projects energy transition to grow Africa’s economy by 6.4% by 2050
The International Renewable Energy Agency (IRENA) and the African Development Bank have revealed the results of a report that demonstrates that an integrated policy framework built around energy transition has the potential to bring a new wave of investments to Africa, facilitating an economic growth projection of 6.4% by 2050. The report, titled Renewable Energy Market Analysis: Africa and its Regions, highlights that energy transition in Africa has the potential to generate 26 million jobs by 2050, far outstripping the projected loss of jobs owing to the ailing fossil fuel industry – which currently employs approximately 2 million people in Africa. Moreover, the report shows that Africa is already experiencing capital gains from renewable investments, with the transition significantly improving both energy access and socio-economic development. Accounting for approximately 70% of Africa’s total electricity generation, fossil fuels have dominated the continent’s energy sector for decades, owing to established processes and fossil fuel development-related infrastructure. Thus, as energy transition finance becomes more readily available, the continent is poised to benefit from its abundant natural resources, with coordinated efforts being made to prioritise renewable energy development while phasing out harmful fossil fuels, such as coal.
Source: Energy Capital
EABC calls for review of region’s rules of origin
East Africa’s private sector wants a review of the region’s rules of origin in order to maximise its gains from the implementation of the African Continental Free Trade Area (AfCFTA). Traders, under the East African Business Council (EABC), say that the existing rules, which have not been reviewed since 2015, have denied a number of products duty-free access to the East African Community (EAC) markets. The current rules of origin deny edible oil, cement and newly introduced fruits duty-free access, among other products. The EAC rules of origin set the criteria to distinguish between goods that are produced within the EAC customs territory and are eligible for community preferential tariff treatment, and those produced outside the bloc, which attract import duties specified in the Common External Tariff (CET). The main intention of the review is to make EAC rules of origin facilitate trade and attract more investments into the region. However, there has been an outcry from the business community that some areas in the rules need to be reviewed to respond to the environment, especially the coming into effect of the AfCFTA.
Source: The EastAfrican
EAC loses USD3.4-billion to COVID-19 measures as trade declines
Uganda was the only country in the region to record a trade increase of 4.6% in 2020, a year when the average economic growth for the entire East African region declined to as low as 2.3% from 5.4% in 2019. In general, the East African Community (EAC) member states lost USD3.36-billion worth of trade in the year when the COVID-19 pandemic spread like bushfire, cutting global trade links and pushing regional and global economies into total lockdowns, according to the latest draft report on EAC Trade and Investment for 2020. The report shows that the total investment in the region declined by almost 46.29% in 2020. Overall trade for the six member states – Rwanda, Uganda, Tanzania, Burundi, Kenya and South Sudan – dropped by 6.08% to USD51.91-billion in the period, from USD55.27-billion in 2019. In the six years between 2015 and 2020, the region lost about USD1.54-billion (3%) of its trade to USD51.91-billion from USD53.45-billion in 2015, the report says. On the bright side, total exports from the region increased by 3.15% to USD16.25-billion from USD15.76-billion in 2019 due to increase in the value of EAC exports to the United Arabs Emirates and the United Kingdom.
Source: The EastAfrican
Angola raises USD1.6-billion from Privatisation Programme
Angola raised AOA850-billion (about USD1.6-billion) with the sale of 73 assets under the country’s Privatisation Programme, Angolan Secretary of State for Finance and Treasury Ottonil dos Santos said on Wednesday, 19 January. During an assessment session, dos Santos said Angola is expected to privatise 15 assets, of which 11 are industrial units and two are financial institutions, during the first quarter of 2022. Started in mid-2019, the Privatisation Programme essentially aims to strengthen the country’s private sector, making it more efficient and competitive, said dos Santos. The programme is in line with the country’s 2018-2022 National Development Programme and falls within the scope of the Public Finance Reform, with a view to promoting macroeconomic stability, increasing the productivity of the national economy and achieving a more equitable distribution of national income.
No Ghana Card, no banking – Banks ready to comply
Banks have expressed their readiness to comply with the Bank of Ghana (BoG) directive that mandates them to use only the Ghana Card in identifying their customers before transacting business with them. The Ghana Association of Bankers (GAB) said the 1 July 2022 deadline was favourable and they would take the necessary steps to enable them to comply. The chief executive officer of the GAB, Mr John Awuah, told the Daily Graphic that banks had been working with the National Identification Authority and its private partner to link their systems to the National Identity Register for the purposes of verification. Consequently, he expressed the confidence that the processes would be completed by June to allow for its take off in July. The central bank also directed the affected institutions to take steps to update their customer records using the Ghana Card details as the only form of identification. The directive issued on Wednesday, 19 January and signed by the bank’s secretary, Ms Sandra Thompson, said the move was to ensure the safety of the financial system. “The public is to note that no other form of identification will be accepted for financial transactions in all BoG-regulated financial institutions after the effective date stated above,” the notice stressed.
Source: Graphic Online
How Kenya will benefit from global cross-border tax deal
Countries across the globe are signing up for the Organisation for Economic Co-operation and Development (OECD) initiative that requires tax authorities of participating countries to automatically exchange tax-related information on financial assets held in foreign countries. The initiative is dubbed Common Reporting Standards (CRS). Accessibility of such tax information is a valuable tool that authorities around the world are using to curb cross-border tax evasion. Kenya has not been left behind. The passage of the 2021 Finance Act saw Kenya bring forth a raft of initiatives aimed at launching tax information exchange with other CRS-participating jurisdictions. This will help the Kenya Revenue Authority (KRA) in curbing revenue leakages. This measure is in line with the current global drive to increase transparency for purposes of combatting tax evasion among other crimes. The Act introduced a mandatory requirement for financial institutions to conduct due diligence for purposes of identifying foreign accounts. The identified accounts will be reported to the KRA. Subsequently, the KRA will exchange this information with the tax authorities of the participating jurisdictions.
Source: Business Daily
Kenya invites bidders for COVID-19 vaccine factory
Kenya has invited firms through a global tender to bid for the construction of a COVID-19 vaccine plant as it enters the homestretch on manufacturing the jab locally. The state is seeking to recruit a consultant and a firm to design, build, commission and maintain a fully-fledged vaccine manufacturing facility. The tender has been floated through an advertisement by the Kenya BioVax Institute, a state-owned commercial and manufacturing firm. “To achieve this objective, the Government of Kenya desires to recruit a GMP [good manufacturing practice] consultant and a firm to design-build-commission-maintain a fully-fledged vaccine manufacturing facility,” a public notice, signed by the director-general of Kenya BioVax Institute states. The floating of the tender comes barely three months after President Uhuru Kenyatta announced that Kenya had started building a filling plant for the COVID-19 vaccines by April ahead of a fully-fledged manufacturing capability by 2024. “As the first step towards this goal, we have established the Kenya BioVax Limited as a venture that would locally produce anti-COVID-19 vaccines,” said President Uhuru Kenyatta. “I, therefore, directed the Ministry of Health to operationalise the company,” he said.
Source: Business Daily
Kenya / United Arab Emirates
Dubai drops Uganda from red list as it retains Kenya
Kenya is still locked in Dubai’s ‘Red List’ even as it removed five African countries whose citizens had been barred from visiting the United Arab Emirates (UAE) have been from the travel restriction. The UAE left Kenya out in its latest review, which saw Ghana, Angola, Uganda, Guinea and Côte d’Ivoire allowed admission to the middle-eastern state. “With effect from 13 January, Emirates will resume passenger services to and from Guinea (CKY), Côte d’Ivoire (ABJ), Ghana (ACC), Uganda (EBB) and the Republic of Angola (Luanda),” reads a statement from the carrier’s website. The aviation regulator told the Business Daily that Dubai had asked Kenya to put its house in order first before it could review the flight ban, which was in kind reciprocated by Nairobi.
Source: Business Daily
MCTU, CfSC push for workers’ welfare
The Centre for Social Concern (CfSC) and Malawi Congress of Trade Unions (MCTU) have asked Treasury to consider increasing the minimum wage to incentivise and cushion workers from the rising cost of living. In its input to the 2022/23 National Budget proposal, CfSC argues that Treasury’s move to increase the minimum wage to MWK50 000 in the 2020/21 financial year, which was effected in January 2021, did not help to improve the living standards of low-income earners. In an interview on Tuesday, 18 January, CfSC economic governance officer Bernard Mphepo observed that the cost of living is increasing. He said as at October 2021, an average Malawian needed MWK221 000 a month to survive against the minimum wage of MWK50 000. “The low minimum wage is not necessarily only due to performance of our economy, but also exploitive policies. “CfSC believes that an increase in minimum wage will support the majority of Malawians to move out of poverty. It is, therefore, imperative to formulate a budget that will also cushion or embrace poor people in Malawi who form the majority of the population.” Mphepo said Treasury should consider putting deliberate policies to cushion low-income earners who are struggling to survive because of the impact of the pandemic.
Source: The Nation
Regulations to enforce Buy Malawi Strategy
The Ministry of Trade has developed regulations for the Buy Malawi Strategy to compel retailers to stock a certain percentage of locally-produced products. The ministry says the regulations are expected to be launched during the first quarter of this year. But Consumers Association of Malawi executive director John Kapito in an interview on Tuesday, 18 January, faulted the introduction of controls in a liberalised market environment. The ministry’s Director of Trade Charity Musonzo said in an interview on Tuesday that the regulations follow the continued reluctance by some retailers to stock locally-produced products despite being of high quality. She said apart from compelling retailers to stock the products, the regulations will also guide them to put the products on prominent shelves for easy identification by consumers. Musonzo said: “We want to enforce the Buy Malawi [but] we are not able to force someone to implement provisions of the strategy.” “Without the legal provisions, we could not do much, but once the regulations are in place, we will implement the provisions contained in the strategy.” But Kapito has faulted the move, saying government cannot liberalise the market and at the same time control what should be sold and bought.
Source: The Nation
FG to spend 0.5% of GDP on technology, innovation – Minister
The federal government will spend 0.5% of the country’s GDP on science, technology and innovation in order to promote creativity among the youth and create jobs, the Minister of Science, Technology and Innovation, Dr Ogbonnaya Onu, has said. He said this at the Consultative Meeting on the provision of a minimum of 0.5% of GDP for funding science, technology and innovation sectors in the country on Wednesday, 19 January. Daily Trust reports that the government had declared at the 2021 edition of the Annual Science Technology and Innovation (STI) Expo that half of 1% of the country’s GDP will be channelled towards the development of STI to ensure continuous productivity and sustainability in the country. The minister stated that countries that have made giant strides in sustaining their economies invested heavily in STI sectors which guaranteed their continuous growth as well sustained their industrial development. According to the minister, the decision to increase the nation’s STI funding was made at the African Union’s executive council in 2006 to establish a target for all member states to each allocate 1% of their GDP investment in research and development.
Source: Daily Trust
Tanzania debt grows by USD5-billion in 12 months
Tanzania’s national debt stood at USD36.08-billion by the end of November last year, up USD5.34-billion year-on-year from November 2020, according to latest figures published by the central bank. External debt closed at USD27.95-billion, a USD215.8-million drop from October which the Bank of Tanzania (BoT) attributed to debt servicing payments outweighing disbursements during the month. But the debt was still higher by USD4.12-billion compared with November 2020. According to the BoT, debt service payments in November amounted to USD171.4-million, of which USD114.2-million was in the form of principal repayments and the rest representing interest. The government continued to dominate the external debt by borrower category, accounting for 73.4%, with debt to multilateral institutions accounting for the largest share (44.1%) followed by commercial creditors (34%). At least 23.1% of external borrowing went to finance transport and telecommunications-related activities, social welfare and education (16.1%), and energy and mining (16%).
Source: The EastAfrican
Tanzania hands over AfCFTA ratification instruments
Tanzania has officially submitted the instruments of its ratification of the African Continental Free Trade Area (AfCFTA) Agreement to the African Union Commission (AUC). Ratifying the AfCFTA agreement means that the country will now be able to access the market of over 1.3 billion people across the continent. This will help to foster the free movement of goods, services, and people across borders and help meet the continent’s enormous economic potential. The new development comes after the Parliament of Tanzania passed resolution No. 4/2021 of 9 September 2021, granting permission for Tanzania to be part of the AfCFTA. The instruments of ratification was presented by the Ambassador of Tanzania in Ethiopia, Innocent Shiyo, who is also the country’s Permanent Representative to the African Union. Ambassador Shiyo presented the instruments of ratification to the Commissioner for Trade and Industry of the African Union Commission Ambassador Albert Muchanga who received them on behalf of the chairman of the AUC Moussa Faki Mahamat.
Source: Daily News
Tanzania / Burundi
Tanzania and Burundi sign USD900-million SGR railway project MoU
Tanzania and Burundi have signed a Memorandum of Understanding (MoU) to build a 282 km portion of the Standard Gauge Railway (SGR) linking Gitega, the capital of Burundi, to Uvinza in western Tanzania. From there, the SGR will connect Burundi to the Indian Ocean at the port of Dar es Salaam. The agreement was signed by Tanzania’s Minister of Finance and Planning Mwigulu Nchemba, Tanzania’s Minister of Works and Transport Makame Mbarawa, Burundi’s Minister of Infrastructures, Equipment and Social Housing Deogratius Nsanganiyumwami, and Burundi’s Minister of Finance, Budget and Economic Planning Domitien Ndihokubwayo. During the signing ceremony, Minister Nchemba clarified that the two governments will jointly seek financing for the railway, adding that the final cost will likely not exceed USD900-million. Tanzania will reportedly construct a 156 km section of the Tanzania-Burundi SGR railway line, from the town of Malagarasi to Uvinza, while Burundi will construct a 126 km stretch from Uvinza to Gitega. The SGR will link Tanzania, from the port of Dar es Salaam, to the neighbouring countries of Rwanda, Burundi and the Democratic Republic of the Congo.
Source: Tanzania Invest
Uganda acts to ease border gridlock that triggered fuel crisis
Uganda announced that it was suspending mandatory COVID-19 testing at the border with Kenya after the measure caused huge truck queues, disrupting fuel supplies across the country. The crisis has led to panic-buying and skyrocketing prices at the petrol pump, with one minister warning traders not to take advantage of the shortages to "cheat" Ugandans. Kenyan media reports spoke of traffic snarl-ups snaking as much as 70 km from its border with Uganda because of the delays caused by the COVID-19 testing. "The (Ugandan) Ministry of Health has immediately and temporarily suspended mandatory testing at the two border points to ease movement of trucks into and within the country," ministry official Charles Olaro told AFP. He said the move was also aimed at averting a "potential super-spreader" event at the border with so many drivers caught in the logjam. In some parts of the country, petrol stations had run out of fuel while at others, petrol was selling for USD3.40, a threefold increase.
Source: The EastAfrican
Uganda’s 2022 economic outlook
Uganda’s economy underperformed in 2020 as the COVID-19 pandemic lockdown took a toll on economic activities. The economy is projected to grow by 3.5-3.8% in financial year (FY) 2021/22 and 5.5-6.0% in FY2022/23, before increasing to 6.5-7.5% in the medium-term (two to three-years ahead), according to the Bank of Uganda, driven by the ongoing vaccinations and easing of restrictions. However, the economy still faces numerous challenges ahead. Import growth is expected to outpace exports due to recovery in import-intensive household consumption and private investment. As a result, the contribution of net exports to GDP growth will be negative for an extended period. Moreover, although the fiscal impulse remains positive in FY2021/22, its contribution to GDP growth is lower than the last financial year owing to the limited fiscal space to support further increases in government expenditure. Also, the recent surge in international commodity prices, especially oil prices, and the recent exchange rate depreciation could spark inflation. The situation could be worsened by the likely increase in global inflation that could prompt a faster-than-anticipated monetary normalisation in advanced economies, weakening the local currency, and further fuelling domestic inflation.
Source: The Independent
Entry visa fees revised
The Department of Immigration has revised entry visa employment and investor permit fees, among others, aimed at streamlining and harmonising various charges that impact the cost of doing business. Visa fees for single entry and transit entry will now cost USD25 while double entry is pegged at USD40, with multiple entry costing USD75 and for a day tripper, USD10. The Kaza visa, which is mainly for international tourists, will now cost USD50. Under the private sector, fees are now costing ZMW4 500 for a cross-border permit issuance while its renewal is pegged at ZMW6 750, with a replacement costing ZMW4 500 and a permit variation by change of passport costing ZMW1 500. According to a notice issued by the Department of Immigration, the new fees apply from 1 January 2022. No fees will apply for diplomatic permit issuance, its renewal or replacement. The employment permit issuance is now at ZMW18 000 with its renewal pegged at ZMW21 000, while a replacement is costing ZMW18 000 and a variation by change of occupation will now cost ZMW9 000. Investors’ permit issuance stands at ZMW12 000 with its renewal costing ZMW15 000.
Source: Zambia Daily Mail
Banking sector loans, advances on the rise, says central bank
Banking sector loans and advances in Zimbabwe are on the increase, with foreign currency loans accounting for 32% of all advances, the central bank says. The non-performing loans ratio has sagged to below 1%. Although Zimbabwe has largely battled for currency stability, its banking sector, including units of Nedbank, Standard Bank and Standard Chartered, has been boosted by a 53% surge in income growth, as well as a surge in non-interest income, owing to the robust uptake of digital, mobile and online banking. The Reserve Bank of Zimbabwe (RBZ) said that “total banking sector loans and advances increased by 22.98%” for the September 2021 quarter. The surge in Zimbabwean banks loans and advances for the quarter period is attributable “to the translation of foreign currency denominated loans”. On the other hand, foreign currency denominated loans “accounted for 32% of total banking sector loans as at 30 September 2021,” notes the RBZ in its latest banking sector report.
Source: New Zimbabwe
Incentives push gold output by 55.5% – RBZ
The Reserve Bank of Zimbabwe (RBZ) has hailed the Gold Incentives Scheme (GIS) introduced by the government last year for increasing the precious mineral’s output and deliveries by 55.5%. Small-scale miners also maintained the lead in production ahead of large producers. In a statement on Wednesday, 12 January, the RBZ governor, John Mangudya applauded producers for a sterling job after posting good productive results. “Small and large gold producers have delivered a total of 29 629.61 kg of gold to Fidelity Gold Refinery (FGR) in 2021, a 55.5% increase from the 19 052.65 kg delivered in 2020,” he said. “Large gold producers delivered 11 159 kg to [FGR] in 2021 whilst small-scale producers contributed 18 470 kg.” The central bank chief also commended the government for introducing the GIS last May saying the scheme had made a significant impact on gold deliveries to FGR. Under the GIS, the RBZ allows some gold exporters to retain up to 100% of their gold earnings depending on their output. Under the arrangement, gold producers are also allowed to export their processed mineral equivalent to the incremental portion and secure loans for production.
Source: New Zimbabwe
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