Manufacturers have protested over the January 1 increase of standard gauge railway (SGR) cargo charges by up to 79 per cent and want the State to first sort out the problem of delayed shipment clearance at port of Mombasa and Embakasi depot.
Kenya Association of Manufacturers (KAM) has petitioned Transport minister James Macharia to maintain the current rates, adding the higher charges will increase the costs of doing business.
The lobby wants easing of the cargo clearance bottlenecks at Mombasa port and Inland Container Depot (ICD) in Embakasi, verifaction of goods improved and delays in returning empty containers made a thing of the past, arguing they are paying more for storage charges or demurrage.
The cost of transporting a 20-foot container from Mombasa to Nairobi will increase to $500 (Sh51,275) from Sh35,000, a 46.5 per cent rise.
Hauling the larger 40-foot container will cost up to Sh$700 (Sh71,785), from the current Sh40,000, reflecting a 79.9 per cent rise.
“We propose the ministry to consider extending the implementation of promotional rate to June, 2019 and thereafter gradually increase at a rate of five per cent every six months. This is to allow the agencies in the industry to streamline their services,” said KAM chief executive Phyllis Wakiaga.
“They can’t increase the charges now. We want them to address all the operational [inefficiencies] existing at Mombasa port and at the ICD in Nairobi,” she said. The promotional tariffs were introduced in January when the service was introduced and were meant to end in April before being extended twice to June and December.
Those transporting cargo from Nairobi to Mombasa will pay $250 (Sh25,637) for a 20-foot container, up from Sh25,000 while a 40 foot container weighing up to 20 tonnes will cost $350 (Sh35,892) and $375 (38,456) for those weighing between 21-30 tonnes.
Kenya Railways has been charging Sh30,000 to transport a 40-foot container from Nairobi to Mombasa irrespective of weight.
The Treasury also expects the SGR business to generate more revenue to help offset loans used in building the multi-billion shilling railway line.
Kenya services China Exim Bank loans used for construction of the line and paid Sh26.61 billion in the year ended June.
The Treasury will pay Sh36.24 billion in the year starting July. Kenya borrowed Sh324 billion for the project from the bank in May 2014, to be repaid in 15 years, with a grace period of five years.
Cargo from Mombasa has been terminating at the inland container depot (ICD) in Nairobi’s Embakasi area. This has forced importers to spend between Sh15,000 and Sh20,000 to ferry cargo from the depot to industries within Nairobi and its environs.
With road transporters charging between Sh60,000 and Sh80,000 to ferry a 20-foot container from Mombasa port to the doorstep of the importer in Nairobi, SGR has faced stiff competition from truckers.
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.