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Western pipeline volumes up 31pc after tariff slash

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Economy

Western pipeline volumes up 31pc after tariff slash

Kenya Pipeline Company
Kenya Pipeline Company Nakuru depot. PHOTO | AYUB MUIYURO 

Petroleum volumes loaded via Western Kenya pipeline depots jumped 31 percent to 183.4 million cubic meters in three weeks to December 2 compared to a similar period last year after reduction of tariffs, fresh data shows.

The Energy and Petroleum Regulatory Authority (EPRA) in a report tabled before the Senate shows that oil transporters are reverting to the pipeline.

In the period November 15-December 2 last year, they had loaded 139.7 million cubic meters.

EPRA cut tariffs for fuel transported through the Kenya Pipeline Company (KPC) network to Sh3,089 ($30.89) per 1,000 litres from Sh6,000 effective November 15 in an effort to win back oil transporters who had opted for Dar es Salaam.

EPRA Director-General Pavel Oimeke said the revision was necessary since Kenya was losing the Rwandan and Ugandan petroleum export markets to Dar es Salaam due to the high pipeline tariff.

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The western depots in Eldoret, Nakuru and Kisumu are largely used to load oil products headed to Uganda, Rwanda, Democratic Republic of Congo (DRC) and northern Tanzania, in addition to the domestic market.

“With implementation of the new tariffs, throughput volumes in Western Kenya KPC depots have significantly increased,” EPRA says in the report tabled before Senate.

The increase will likely boost Kenya’s petroleum exports that dropped 43 percent from Sh2.1 billion in the first six months of 2018 to Sh1.2 billion in the first half of 2019.

The data shows that the KPC depot in Nakuru had the highest growth in fuel throughput at 48 percent to 39.3 million cubic meters in three weeks to December 2 from similar period last year.

The volumeof oil transported through the pipeline at Eldoret depot stood at 84.2 million cubic meters, reflecting a rise of 47 percent from similar period last year.

The Kisumu depot had the lowest growth at eight percent to hit 59.9 million cubic meters in the period under review from similar period last year.

The tariffs will further fall to Sh3,065 ($30.65) in 2020 and Sh2,907 ($29.07) in 2021.

KPC has protested the new tariffs saying they will hurt its revenue.

The parastatal said that Kenya has not been losing the export market for fuel but has lost the lubricating oils and grease market, which it does not handle.

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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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