The value of Kenya’s imports from neighbouring countries jumped by 42.64 per cent in nine months through September amid flat growth in exports, fresh official statistics show, hurting job opportunities for the youth.
Traders trucked in goods worth Sh54.83 billion from the six-nation East African Community (EAC) bloc compared with Sh38.44 billion in the same period in 2017, largely due to Kenya’s reliance on her neighbours for food supplies such as grains.
The data collated by the Kenya National Bureau of Statistics (KNBS) indicate imports from the EAC countries increased by nearly one-and-a-half times compared with Sh22.56 billion in the corresponding period in 2016.
The growth in regional import bill is largely driven by landlocked Uganda where Kenya imported goods worth Sh41.16 billion between January and September 2018, a steep rise from Sh24.56 billion the year before.
Exports to the EAC countries, on the other hand, continued a marginal but steady declining streak to Sh86.78 billion in the period from Sh86.86 billion a year earlier, Sh92.01 billion in 2016 and Sh96.83 billion in 2015.
Persistently higher demand for imports from the region than exports may mean Kenyan jobs are being lost to neighbouring countries such as Uganda.
Exports to Uganda remained flat during the review period at Sh46.09 billion from Sh46.92 billion in the January-September period of 2017.
Order book from Tanzania, however, grew to Sh22.17 billion from Sh20.76 billion while Rwanda’s increased to Sh13.49 billion from Sh13.07 billion.
Manufacturers have long blamed multiple fees and levies, relatively high power charges and inefficiencies at factories for piling up the cost of production, making locally made goods expensive in regional markets.
Exports to regional markets have also been hit by non-tariff barriers fuelled by mistrust and unresolved disputes among some of the EAC partner states.
Earnings from exports by Kenyan sugar confectionery firms, for example, fell by Sh304.5 million in the review period amid unresolved dispute on duty with Tanzania and Uganda.
Income from exports of the commodities such as sweets, chewing gum and chocolates dipped to Sh3.52 billion in the January-September 2018 period from Sh3.82 billion in the corresponding period in 2017, the statistics office says in its latest report.
Dar es Salaam and Kampala slapped a 25 per cent duty on Kenyan-made sugar confectionery in March 2018, claiming the use of zero-rated industrial sugar which tilted competition in favour of Nairobi factories.
The dispute was still unresolved by end of September 2018 even after Kenya chose not to renew duty-free window for the importation of table sugar when it expired earlier in June.
World Bank pushes G-20 to extend debt relief to 2021
World Bank Group President David Malpass has urged the Group of 20 rich countries to extend the time frame of the Debt Service Suspension Initiative(DSSI) through the end of 2021, calling it one of the key factors in strengthening global recovery.
“I urge you to extend the time frame of the DSSI through the end of 2021 and commit to giving the initiative as broad a scope as possible,” said Malpass.
He made these remarks at last week’s virtual G20 Finance Ministers and Central Bank Governors Meeting.
The World Bank Chief said the COVID-19 pandemic has triggered the deepest global recession in decades and what may turn out to be one of the most unequal in terms of impact.
People in developing countries are particularly hard hit by capital outflows, declines in remittances, the collapse of informal labor markets, and social safety nets that are much less robust than in the advanced economies.
For the poorest countries, poverty is rising rapidly, median incomes are falling and growth is deeply negative.
Debt burdens, already unsustainable for many countries, are rising to crisis levels.
“The situation in developing countries is increasingly desperate. Time is short. We need to take action quickly on debt suspension, debt reduction, debt resolution mechanisms and debt transparency,” said Malpass.
Kenya’s Central Bank Drafts New Laws to Regulate Non-Bank Digital Loans
The Central Bank of Kenya (CBK) will regulate interest rates charged on mobile loans by digital lending platforms if amendments on the Central bank of Kenya Act pass to law. The amendments will require digital lenders to seek approval from CBK before launching new products or changing interest rates on loans among other charges, just like commercial banks.
“The principal objective of this bill is to amend the Central bank of Kenya Act to regulate the conduct of providers of digital financial products and services,” reads a notice on the bill. “CBK will have an obligation of ensuring that there is fair and non-discriminatory marketplace access to credit.”
According to Business Daily, the legislation will also enable the Central Bank to monitor non-performing loans, capping the limit at not twice the amount of the defaulted loan while protecting consumers from predatory lending by digital loan platforms.
Tighter Reins on Platforms for Mobile Loans
The legislation will boost efforts to protect customers, building upon a previous gazette notice that blocked lenders from blacklisting non-performing loans below Ksh 1000. The CBK also withdrew submissions of unregulated mobile loan platforms into Credit Reference Bureau. The withdrawal came after complaints of misuse over data in the Credit Information Sharing (CIS) System available for lenders.
Last year, Kenya had over 49 platforms providing mobile loans, taking advantage of regulation gaps to charge obscene rates as high as 150% a year. While most platforms allow borrowers to prepay within a month, creditors still pay the full amount plus interest.
Amendments in the CBK Act will help shield consumers from high-interest rates as well as offer transparency on terms of digital loans.
Scope Markets Kenya customers to have instant access to global financial markets
NAIROBI, Kenya, Jul 20 – Clients trading through the Scope Markets Kenya trading platform will get instant access to global financial markets and wider investment options.
This follows the launch of a new Scope Markets app, available on both the Google PlayStore and IOS Apple Store.
The Scope Markets app offers clients over 500 investment opportunities across global financial markets.
The Scope Markets app has a brand new user interface that is very user friendly, following feedback from customers.
The application offers real-time quotes; newsfeeds; research facilities, and a chat feature which enables a customer to make direct contact with the Customer Service Team during trading days (Monday to Friday).
The platform also offers an enhanced client interface including catering for those who trade at night.
The client will get instant access to several asset classes in the global financial markets including; Single Stocks CFDs (US, UK, EU) such as Facebook, Amazon, Apple, Netflix and Google, BP, Carrefour; Indices (Nasdaq, FTSE UK), Metals (Gold, Silver); Currencies (60+ Pairs), Commodities (Oil, Natural Gas).
The launch is part of Scope Markets Kenya strategy of enriching the customer experience while offering clients access to global trading opportunities.
Scope Markets Kenya CEO, Kevin Ng’ang’a observed, “the Sope Markets app is very easy to use especially when executing trades. Customers are at the heart of everything we do. We designed the Scope Markets app with the customer experience in mind as we seek to respond to feedback from our customers.”
He added that enhancing the client experience builds upon the robust trading platform, Meta Trader 5, unveiled in 2019, enabling Scope Markets Kenya to broaden the asset classes available on the trading platform.