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The year began on a promising note but was disappointing

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A farmer picks ripe coffee beans from her farm in Nyeri. PHOTO | FILE 

The year was a big disappointment to most coffee farmers across the country. But at the beginning of the year, there were signs of a good harvest when the long rains came early in March. This is when flowering starts, and given the way the crop had blossomed, growers anticipated a good year.

However, things changed when the rains continued longer than expected, such that, by July, the farmers hopes were shattered after diseases associated with extreme wet conditions struck.

For instance, the little-known Solai/Elgon die, was reported in Kiambu, Nyeri, Kisii, Murang’a and Nandi counties. Previously, the disease was mainly confined to Nakuru and the Mount Elgon area in Trans Nzoia County.

The more common coffee berry disease (CBD) was also reported. But unlike other years, most farmers in the Mount Kenya region complained about the agro-chemicals they use to control the spread of CBD. They lamented that the sprays were not effective.

Cooperative societies, which smallholder farmers use to market their coffee, have reported very low production, compared with other years.

At the Gatura Factory in Nyeri County, growers had delivered only 120,7227 kilos of coffee cherries by the third week of December, a the factory’s chairman, Mr Wanyaga Mutahi said, “In good season we usually register between 350,000 kilogrammes and 400,000 kilogrammes during such a period of the year,” he offered.

In some parts of the country, most farmers are staring at a crop failure.

Farmers were not sure whether the agrochemicals they use to stop the spread of the CBD was the problem. Some of the spray chemicals, they bought from different retailers worked, others did not.

So, the National Coffee Cooperative Union (NCC) — an umbrella organisation for smallholder farmers, sought an explanation from the national government.

There were suggestions that the agrochemicals should have been analysed by the Coffee Research Foundation (CRF) before being released to growers for use — as used to happen before.

But the CRF explained that it no longer gets government funding since Agriculture was devolved. And it is not the counties’ responsibility to establish whether or not an agrochemical is genuine. Besides, county governments lack the capacity to conduct such analyses.

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This is an issue that was not addressed despite demands by the NCC.

Perhaps what would have brightened the farmers’ fortunes are the legal reforms developed by the Coffee Sub-Sector Implementation Committee (CSIC).

President Uhuru Kenyatta had set up the committee two years earlier to implement proposals made by a national task force he had appointed to turn around the coffee sub-sector.

First, the CSIC came up with the Coffee (General) Regulations 2016 draft, which was trashed by the officials of coffee cooperative unions. They were mainly opposed to the proposed mode of payment, whereby farmers would be paid directly through their individual accounts after their coffee is sold at the Nairobi Coffee Exchange (NCE).

After rejecting the rules in 2017, CSIC Chairman Joseph Kieyah brought in other stakeholders, apparently to find a way out.

He convened a high-level meeting of experts and governors from the 31 coffee-growing counties in January, and another with other stakeholders. He eventually came up with a revised draft, the Coffee (General) Regulations 2018, which, again, did not see the light of day. The draft is now before Parliament, awaiting debate and approval.

In the revised version, the role of a marketing agent at the NCE has been phased out. Only millers are required to grade coffee before taking it to the NCE.

It is believed that the marketers and millers worked behind the scenes to influence union officials to reject the new rules. And this is because the proposed regulations stipulated that every business transaction made by the miller at the auction must be made public.

But the committee’s term ended in October before Prof Kieyah and his team gazetted the new regulations. President Uhuru Kenyatta extended their term for the second time — for another one year. In addition, he appointed Susan Mochache, the Principal Secretary for State Department for Cooperatives, to co-chair the CSIC.

Other CSIC proposals like issuance of cheap fertilizer to farmers have been implemented. What the government is in the process of carry out is forensic audit of all the coffee cooperative unions in the country, which was also part of CSIC’s recommendation to resuscitate the ailing coffee industry.

The process has already kicked off but owing to lack of funds, the Department of Cooperative is currently conducting preliminary audit. It started with Nyeri, which was selected to pilot coffee reforms CSIC is implementing.

And the money from coffee proceeds has to be channelled directly to the grower – not through their Saccos as has been the norm.

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World Bank pushes G-20 to extend debt relief to 2021

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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.

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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.

ALSO READ:Global Economy Plunges into Worst Recession – World Bank

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Kenya’s Central Bank Drafts New Laws to Regulate Non-Bank Digital Loans

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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.

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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.

SEE ALSO: Central Bank Unveils Measures to Tame Unregulated Digital Lenders

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Scope Markets Kenya customers to have instant access to global financial markets

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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.

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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.

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