Private investment in Africa exceeds expectations

Despite widespread decline felt by most economies across the globe, private equity fundraising in Africa has already managed to reach USD1.3-billion for the first half (H1) of 2021. This includes final and interim closes. Mirroring the gradual stabilisation of Africa's macroeconomic environment is the African private equity (PE) industry, which continues to prove itself and is once again on a growth trajectory. This is according to the 2021 H1 African Private Equity Data Tracker, released by the African Private Equity and Venture Capital Association (AVCA). The report reveals that North and West Africa jointly attracted the largest share of PE deals by volume at 23% each. Multi-region deals attracted 50% of deal value for H1 of the year. The data tracker provides a provisional look at half-year PE activity in Africa, which AVCA chief executive officer Abi Mustapha-Maduakor believes is particularly salient in the current uncertain economic conditions. The first half of 2021 saw 120 reported deals to the value of USD2.1-billion concluded on the continent. Financial, consumer discretionary, industrial, and information technology rose to the top, attracting the greatest investment, accounting for 72% of the total deal volume in H1 of 2021.

Source: The Namibian

Africa

Tariffs, rules of origin new hurdles to Africa's trade area

The implementation phase of the African Continental Free Trade Area (AfCFTA), which went live on 1 January, is still bogged down by technicalities as key provisions of the agreement are yet to be concluded. The technical provisions that are proving to be a hurdle to trade are the rules of origin, the tariff offer and customs union. A meeting held at the AfCFTA headquarters in Accra, Ghana from 18-19 September, to review the agreement nine months after its inception, found that without these provisions no trade can take place, at least not as easily as envisaged. East Africa’s private sector was represented in Accra by the East African Business Council’s (EABC) chief executive John Bosco Kalisa who emphasised the importance of establishing the rules of origin in the continent’s free trade area. “So far no trading has taken place because we are still ironing out issues. Before anyone starts trading, there are a number of key components such as tariffs and rules of origin – the criteria needed to determine the national source of a product – which have to be agreed on,” he said.

Source: The EastAfrican

East / Southern Africa

Intra-COMESA export trade drops by 11%

The value of intra-Common Market for Eastern and Southern Africa (COMESA) total exports declined by 11% from USD10.9-billion in 2019 to USD9.7-billion in 2020. The low performance was attributed to the impacts of the COVID-19 pandemic and pre-existing factors such as supply-side challenges and prevalence of non-tariff barriers (NTBs). According to an update presented at the 37th Meeting of the COMESA Trade and Customs Committee, 13-15 October 2021, the low intra-regional trade resulted from existing gaps in information availability on trading opportunities, regulatory requirements in markets and factors that inform business decisions on production of goods and trade. Speaking at the opening of the meeting, assistant secretary general in charge of programmes, Dr Kipyego Cheluget observed that regional trade could flourish if member states embraced the COMESA trade and customs facilitation instruments and policies.

Source: COMESA

East Africa

EAC partner states lost 92% tourism revenues due to COVID-19 pandemic

The East African Community (EAC) partner states lost 92% revenues in the tourism sector due to the COVID-19 pandemic. Making the disclosure, EAC Secretary General Peter Mathuki said that tourist arrivals to the region fell from 6.98 million arrivals before the pandemic to 2.25 million arrivals occasioning the losses, adding that the tourism sector was the worst hit by the pandemic. Noting that the region was now open again for business, Dr Mathuki urged EAC partner state governments and other stakeholders to work together to market the region’s tourist attractions and products as part of efforts to ensure speedy recovery for the sector. “Despite the fact that the pandemic has reversed the gains that we had made in the tourism sector, we are quite confident that through collective and collaborative efforts, we should be able to bounce back to pre-pandemic levels of performance and even do better within a span of less than five years,” said Dr Mathuki.

Source: EAC

Botswana

Access Bank lists on stock exchange

Access Bank Botswana, formerly known as BancABC, has recently been listed on the Botswana Stock Exchange (BSE). This was after the major Nigerian financier, Access Bank completed its acquisition of BancABC, snapping up the 78% equity held by ABC Holdings. Atlas Mara, the controlling shareholder in ABC Holdings, said the offer for the 78% represented 1.13 times the book value of the stake in BancABC Botswana. Earlier in March, the Bank of Botswana board concluded that Access Bank has met the licensing and prudential requirements to be licensed as a bank in Botswana hence the approval of the acquisition of 78.15% of ABCH shares in BancABC in March 2021. Presenting during the listing recently, BancABC Botswana managing director Kgotso Bannabotlhe said they have now met all the conditions relating to the Access Bank transaction and are one step closer to publicly transitioning to Access Bank Botswana.

Source: Mmegi

Burkina Faso

Renewables, storage deployment focus for IFC in Burkina Faso

In partnership with the Ministry of Energy and the national utility, Société Nationale d’Electricité du Burkina (SONABEL), the International Finance Corporation (IFC) has developed a roadmap for increased rollout and use of clean energy and storage systems in Burkina Faso. According to the International Renewable Energy Agency (IRENA), energy storage deployment in emerging markets is expected to increase by over 40% annually from 2020 until 2025. By increasing public-private partnerships within the sector, the IFC states that Burkina Faso has the potential to increase renewables capacity in its energy mix for energy security, sustainability, affordability and decarbonisation. The corporation states that the African state could save between USD1.5-million and USD3.3-million per annum by installing 60-70MW (160-220MWh) of independent battery energy storage solutions. In addition, the development could help reduce reliance on fossil fuels and energy imports whilst improving access to affordable energy to those living in energy poverty. With liquefied petroleum gas (LPG) company Sodigaz, the IFC seeks to improve access to cleaner energy solutions for the Burkina Faso population.

Source: ESI Africa

Djibouti

Djibouti Telecom begins construction of new Cable Landing Station

To meet the ever-growing demand and Network resiliency requirement, Djibouti Telecom has started the construction of a new Cable Landing Station (CLS) in Djibouti City. The new CLS will be a neutral digital port which will provide an open access cable landing service to submarine cable operators for a neutral, safe and secure landing in Djibouti City. The new state-of-the-art building will consist of 3 floors with each floor having a 250 square metre equipment room designed with the latest technology offering unparalleled operating efficiency and security to host multiple cables. The new CLS will be equipped with advanced security equipment, techniques and procedures to control access to the premise. Furthermore, the 3rd floor will be reserved for colocation. This neutral colocation centre will allow Google, Apple, Facebook, Amazon and Microsoft (GAFAM) or cloud providers to host their servers closer to their African users. The new CLS is expected to be completed by April 2022.

Source: Djibouti Telecom

Ethiopia / South Africa

Ethiopian Airlines enters interline agreement with South Africa’s Airlink

Ethiopian Airlines has announced that it signed an interline agreement with Airlink, an airline based in Johannesburg, South Africa. Ethiopian has entered into an interline agreement with Airlink to allow passengers to enjoy seamless travel with a single ticket and lower fare tickets between points within the carriers’ synergised networks. With the interline agreements between the two carriers, passengers can book through their itineraries on both airlines easily. The partnership attracts more customers providing ease of connectivity to their destinations served by both Ethiopian and Airlink, Ethiopian noted in a statement sent to 2merkato.com. Ethiopian Airlines has been implementing various partnership agreements with African and global carriers to further expand its accessibility to its customers. The partnership with Artlink, in particular, will increase seamless connectivity options for customers in the regions of South Africa with the vast network of Ethiopian Airlines in the continent and beyond. Ethiopian Airlines connectivity options are crucial in fulfilling the increasing demand.

Source: 2merkato.com

Kenya

Bill exempts fuel from excise review, halves VAT to tame prices

Fuel will be exempted from the annual review of inflation tax while two levies charged on diesel and petrol will fall by half if parliament adopts proposed changes to the law aimed at lowering pump prices. The National Assembly Committee on Finance and National Planning says fuel should be exempted from the annual adjustment and value-added tax (VAT) on petroleum products reduced from 8% to 4%. The proposals contained in the Petroleum Products’ (Taxes and Levies) (Amendment) Bill, 2021 will also slash the levy that motorists pay to support a fuel subsidy scheme from KES5.40 per litre to KES2.90. The Bill set to be tabled in parliament seeks to reduce the price of diesel, petrol and kerosene amid public uproar after pump prices hit historic highs in the monthly review ending on Thursday, 14 October. “The following taxes and levies charged on fuel be amended as follows, reduce the Petroleum Development Levy charged on super petrol and diesel from KES5.40 to KES2.90 and reduce VAT from 8% to 4%,” reads the Bill.

Source: Business Daily

Kenya

NHIF seeks law change to cover against future pandemics

The National Hospital Insurance Fund (NHIF) is banking on parliament to amend the law to establish provisions on how pandemics and epidemics such as COVID-19 will be covered in future. NHIF chief executive Peter Kamunyo told senators that there is no law currently that defines how pandemics and epidemics are to be covered by insurers. Dr Kamunyo told the Senate Health committee that the NHIF (Amendment) Bill, 2021 which aims to create the appropriate health insurance legal framework for attainment of universal health care should be amended to include the provisions. “It is expected that after the review of Kenya's legal framework on health insurance through amendment of the NHIF Act, regulations and policies will be put in place to create provisions on coverage of pandemics such as COVID-19,” he said. Dr Kamunyo said NHIF currently only covers frontline workers from critical illnesses like COVID-19 following a presidential directive. He said the average cost of COVID-19 admissions in hospitals is KES603 130. He added that it costs NHIF up to KES82 584 per day of admission to treat COVID-19 patients in non-government designated institutions compared to KES62 222 for the NHIF per-diem reimbursement.

Source: Business Daily

Kenya

Why Uhuru rejected Biden’s global tax plan

Kenya withheld backing for United States President Joe Biden administration’s push for a global minimum rate of tax on multinational companies because the deal will stop Nairobi from collecting taxes from technology giants such as Google, Facebook and Amazon. The Paris-based Organisation for Economic Co-operation and Development (OECD), which hosted the talks on the overhaul of taxation rules, revealed that Kenya was missing from the list of 136 countries that have backed the agreement. The Kenya Revenue Authority (KRA) recently confirmed that Kenya was uncomfortable with clauses in the agreement that will force it to drop the digital services tax of 1.5% of sales. “Members who join the statement are obliged to withdraw their unilateral measures such as digital services tax and similar measures imposed on non-resident companies which do not have physical presence in the market jurisdiction,” said Terra Saidimu, the KRA commissioner in charge of Intelligence and Strategic Operations. This would have forced Kenya to drop its own digital services tax, which came into effect at the start of January. It is levied on the sale of e-books, movies, music, games and other digital content and applies to foreign companies. The KRA says the tax could generate up to KES13.9-billion in revenue in the next three years.

Source: Business Daily

Kenya / United States

Kenya, US sign private sector trade agreement

President Uhuru Kenyatta on Monday, 11 October, witnessed the signing of a detailed private sector agreement that seeks to expand trade and investments between Kenya and the United States (US). The agreement, signed between the Kenya Private Sector Alliance (KEPSA) and Corporate Council on Africa (CCA), provides a framework for Kenyan and American businesses, especially small and medium-sized enterprises (SMEs) to partner through information sharing, training, logistics, and financing. Established in 1993, CCA is the largest umbrella body of American companies operating in Africa with an overarching objective of promoting trade and investments between the US and the African continent. Speaking at the signing ceremony in New York, on the first day of his two-day official visit to the US, the president said the government-backed pact was part of efforts to support the growth of the Kenyan SME sector as a key enabler of wealth and employment creation.

Source: The Standard

Malawi

Study urges investment in mining, fisheries

A study by the National Planning Commission (NPC) has recommended massive investments in mining and fisheries sectors to unlock billions of Kwacha in earnings. The study has revealed that despite the country being endowed with substantial minerals and water bodies, the nation has not yielded maximum benefits from the resources. The NPC implemented a research-based collaborative project called Malawi Priorities whose findings were revealed in Lilongwe. Malawi Priorities project coordinator Salim Mapila said both the minerals and fisheries sectors face similar barriers which are informality, lack of sophisticated practices and value addition, and limited linkages to markets. The NPC said there should be two major projects; development of artisanal and small scale mining (ASM) landing centres and development of Chipoka Port Fisheries Project. The NPC recommends that MWK5.35-billion would be needed for infrastructure and machinery for mining landing centres and machinery, MWK1.2-billion to MWK1.3-billion would also be needed for administrative costs. The landing centres are expected to boost gemstone and gold for ASM revenues by 35% which is MWK10.17-billion per year by 2028.

Source: The Times

Malawi

Treasury upbeat on economic recovery

Finance Minister Felix Mlusu has said unless the country is hit by another devastating COVID-19 wave, the economy is poised to recover in the short to medium terms. In an interview on the side-lines of the 27th Inter-governmental Committee of Senior Officials and Experts, Mlusu reiterated the need for contextualised analysis of the economy as pangs of the COVID-19 pandemic remained eminent. Mlusu said the Treasury was implementing plans aligned with available resources towards recovery and to propel growth going forward. “We are injecting liquidity into the economy so that it ticks; there are developments in the transport sector, as roads are being constructed; we have paid and we continue to pay arrears that we found in government, close to MWK230-billion. As these businesses are recovering, we will be able to make money from them,” Mlusu said. He further said widening of the tax base, investing in the mining sector, including a samples testing in laboratories and promotion of exports, are some of the plans that will enable the government to improve its resource mobilisation and run development projects.

Source: The Times

Namibia

Financial Institutions and Markets Regulations consultations to start soon

The financial institutions watchdog Namibia Financial Institutions Supervisory Authority (NAMFISA) says it will soon start with formal consultations on the regulations and standards that will accommodate the Financial Institutions and Markets Act. This follows publication in the Government Gazette on Friday, 1 October. The Financial Institutions and Markets Act was published with the NAMFISA Act, and the two pieces of legislation consolidate and harmonise the laws regulating non-banking financial institutions and financial intermediaries, as well as financial markets in Namibia. According to NAMFISA's chief executive officer, Kenneth Matomola, these Acts also aim to strengthen the regulator's enforcement powers, and empower his organisation and the minister of Finance to issue standards and regulations. Matomola says key stakeholders will be informed on the latest developments on the relevant platforms.

Source: The Namibian

Namibia

Namport sees 8 500 tonnes of copper leave for the US

The Namibian Ports Authority (Namport) recently saw 8 500 tonnes of copper being ship-loaded for the port of Panama in the United States (US). Namport executive for commercial services Elias Mwenyo called it a “significant milestone”, as this consignment was the second consignment of copper exported via the port of Walvis Bay in a breakbulk format as an alternative to containerised export. The copper cathodes from Mopani Copper Mine in Zambia were transported to Walvis Bay by road where they were loaded onto the Unisea vessel. “Due to the ongoing global shortage in containers, it has become a phenomenon for shippers to opt for their consignments to be carried by bulk vessels to ensure continuity of operations and less dependency on containers,” said Mwenyo. “With Namibia's ports strategically located along the west coast of Africa and supplemented by the country's excellent road infrastructure, which is rated number one in Africa, the country continues to play a leading role in the facilitation of trade via our transport corridors serving hinterland markets within [the Southern African Development Community].”

Source: The Namibian

Nigeria

NPA repositions seaports for intra-Africa trade

The Nigerian Ports Authority (NPA) has said it is repositioning all seaports in the country to be efficient and reliable gateways for maritime trade as the nation prepares to tap the enormous benefits inherent in the African Continental Free Trade Area (AfCFTA) Agreement. Speaking at the maiden edition of the Nigerian International Maritime Summit (NIMS) which was held recently in Lagos, the acting managing director of the NPA, Mohammed Bello-Koko said repositioning the seaports will optimise Nigeria’s trade interconnectivity with other countries under the AfCFTA Agreement. Bello-Koko, who was represented by the executive director, Marine and Operations, Onari Brown, disclosed that the authority having keyed into the federal government’s agenda to lift 100 million Nigerians out of poverty within a decade, has prioritised the expansion and improvement of port infrastructure, including information and communications technology and security systems. This, he said, was to significantly bring down transportation costs of Nigeria’s trade within the continent and globally.

Source: Leadership

Uganda / East Africa

MTN Uganda offers East Africans free IPO shares

East African investors have been offered free shares to motivate them to buy stock in telecommunications firm MTN Uganda that opened its USD250-million (UGX895.56-billion) initial public offering (IPO) on Monday, 11 October. South Africa’s MTN Group is selling 4.47 billion shares in its Ugandan subsidiary at a price equivalent to USD0.06 (UGX200) a piece. To boost chances of the offer being successful, which will require applications for purchase of at least 1.1 billion shares, MTN is offering prospective investors free shares of between five and 10 units for every 100 units allocated. This represents an effective discount of 5-10% of the purchase price, assuming an investor gets his full allocation and the incentive shares. There are no allocation quotas but Ugandan investors will be given priority in case of oversubscription, offering other East Africans unlimited room to snap the stocks. “As part of the offer, and in alignment with the objective of broadening Ugandan shareholding in MTN… the selling shareholder will transfer incentive shares at nil cost to the categories of qualifying applicants that apply for and are allocated the sale shares,” the prospectus says.

Source: The Citizen

Zimbabwe

Zimbabwe dollar risks collapse, warns business lobby

Zimbabwe’s leading industrialists have warned that the country’s currency is in danger of collapsing as businesses resort to United States (US) dollar transactions. The authorities have in recent weeks arrested scores of foreign traders accused of manipulating the volatile Zimbabwean dollar by trading on the black market. On the streets, the currency changes hands for up to ZWL200 per US dollar, while the official rate is pegged at ZWL90. In a letter to its members, the Confederation of Zimbabwe Industries (CZI) – the largest representative body for local business, said it had cautioned the government against clamping down on firms and traders. “The greatest risk facing the economy right now is an inappropriate policy response to the rising parallel market premium,” CZI said about the widening gap between the official and black-market currency values. “Clamping down on informal exchange trading in the absence of a viable formal market will have catastrophic consequences for the economy.” “The Zimbabwe dollar is in real peril,” the lobby group added.

Source: The EastAfrican