Treasury Secretary Henry Rotich has asked Parliament to regularise Sh3.5 billion payments made to the contractor of the controversial Kimwarer Dam project, which is the subject of ongoing investigations by the Directorate of Criminal Investigations (DCI).
The request for MPs’ approval of the expenditure comes two months after the controversial payment was made, as part of the Treasury’s Sh95.8 billion supplementary currently under Parliament’s scrutiny.
The DCI is investigating circumstances in which Sh21 billion was paid to an insolvent Italian company, CMC di Ravena, for construction of the Kimwarer and Arror dam projects in Elgeyo Marakwet County.
The Treasury released the cash as advance payments for the dam projects that are yet to start.
The fees were largely paid out as part of the conditions that were to be met before commencement of construction.
The money is said to have been wired to Italy before being transferred to England and back to Kenya where it was withdrawn and distributed to local individuals and companies.
Detectives investigating the dam payments have already quizzed four Cabinet Secretaries, including Mr Rotich. Others who have grilled are Mwangi Kiunjuri (Agriculture), Eugene Wamalwa (Devolution) and Peter Munya (Trade, Industry and East Africa).
Mr Rotich is also accused of writing to the National Land Commission asking officials to deal with land allocation issues to enable Kerio Valley Development Authority (KVDA) to resettle residents displaced by the projects.
KVDA, which contracted Italian companies CMC di Ravenna and Itinera for the projects, is under investigation over alleged payment of kickbacks to officials to influence award of the Kimwarer and Arror tenders.
Mr Rotich, KVDA Managing Director David Kimosop and several board members of the State corporation were questioned four times by the DCI on the controversial dam payments.
The Kimwarer and Arror probe also sucked in Deputy President William Ruto who claimed that only Sh7 billion had been paid out.
Mr Rotich said that up to Sh19.8 billion had been paid to different firms in the two projects on various dates by the end of last year.
The two projects are yet to kick off since 2017 when the money was paid.
“The Treasury is seeking reallocation of Sh3.486 billion relating to Kimwarer dam that was allegedly captured wrongly in the budget. But it is not clear where the said money was captured in the budget. It is important to note that this matter is under investigation by the DCI,” the Parliamentary Budget Office (PBO), which advises MPs on fiscal matters, told the Budget and Appropriations Committee chaired by Kikuyu MP Kimani Ichung’wa.
Mr Rotich has presented to Parliament a Sh95.8 billion budget for approval under the Supplementary Budget II.
The mini-budget seeks to regularise payment of pending bills arising from the standard gauge railway (SGR) and the Lake Turkana Wind Power Project for deemed generated electricity among others. The law allows the Treasury to spend money for unforeseen expenditure and seek the House’s approval within two months of such expenditure.
The PBO told MPs that the Treasury had spent part of the money contained in the supplementary budget more than five months ago. Out of the Sh95.8 billion, Sh5.69 billion has been allocated to recurrent expenditure while Sh90.1 billion will go towards development projects.
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.