Posts tagged as: economy

Drawing Lessons From Nyerere On Leadership

editorial

Tanzania today commemorates 18 years since the death of the Founding Father of the Nation, Julius Nyerere. There is pretty much to talk about and learn from Mwalimu, who was not only a political leader, but also a philosopher, theorist, activist, translator and writer.

Mwalimu Nyerere, who was born on April 13, 1922 and died on October 14, 1999, was the first president of Tanganyika and later Tanzania. His decision in 1985 to step down from power, did set the pattern of transition of power from one leader to the next. Since then Tanzania has had four other presidents after him.

As one of the pioneer leaders of an independent Africa, Nyerere stood for total liberation of people from colonialism and any sort of oppression. It was based on this conviction that Tanzania sacrificed immensely towards the liberation struggles of Mozambique, Zimbabwe (Southern Rhodesia), Namibia and South Africa.

It was not surprising that Tanzania was the most important base for all liberation fighters from southern Africa. This is proof that Nyerere was a true believer of freedom of the people. This conviction was deeply rooted in his socialism and self-reliance policy that viewed all human beings as equal.

On the economic front, the Founding Father pushed for self-reliance. He wanted Tanzania, and Africa in general, to try and become as much as self-reliant as they could be. This was particularly in the fight against the archenemies: poverty, disease and illiteracy. For him, it was through self-reliance that a nation could be truly free, particularly when it comes to self-determination.

Freedom, development and discipline connected

It was during Nyerere’s era that Tanzania set up its development road map. The economy was to be based on both manufacturing and agriculture. Much as the economy was young, the first president of Tanzania made every effort to try and establish key primary industries in most parts of the country. Therefore, both agricultural and industrial developments were crucial to his leadership. His main objective was to build a modern society where science and technology play the crucial role of liberating man from the archenemies: poverty, disease and illiteracy.

“Mwalimu (Teacher), as he was affectionately known, spoke strongly about the connection between freedom, development and discipline in building socialism, whose basis was a belief in the oneness of man and the common historical destiny of mankind. It was under his leadership that education was provided for free from primary through university. He was convinced that with a sizeable skilled manpower, the country could unlock much of the economic potentials it has been endowed with.

And, even after stepping down from power, he never hesitated to advice the sitting presidents to work harder in collecting tax. He argued that there will be no development if people and legal entities did not pay their due taxes.

Mwalimu Nyerere was a firm believer of the government being accountable to the people. He argued that since the people paid their due taxes, then they had the right to know what was happening within the government and that it truly served them.

Today’s and future leaders need to emulate Mwalimu Nyerere leadership style that put man at the centre of all development initiatives. They should not seek self-glory but the development of human beings.

Bankers Call for Removal of Interest Rate Caps

By Margaret Njugunah

Nairobi — Kenya Bankers Association is calling for the removal of interest rate capping, a year after it was passed into law.

KBA CEO Habil Olaka says the law has had adverse effects on the economy despite its good intentions.

Olaka said that the law, which was expected to provide low-cost credit and ultimately increase credit uptake has done the opposite as it has instead affected credit growth and discouraged financial inclusion. It was also expected to encourage a savings culture through increased deposits.

It was also expected to encourage a savings culture through increased deposits.

KBA, however, says that deposits – demand and fixed – have shown little evidence of being responsive to the intentions of the law.

At the same time, credit has been skewed towards secure and short-term market end, mainly away from household loans, and has shown a bias towards trade than investment loans.

“It is increasingly becoming evident that the expectations of the law are not being met. For instance, lenders are trading asset quality to portability that is tolerance of lower returns on government papers instead of lending to private sector even at the level of the cap. This is because crowding out is increasingly becoming prevalent,” Olaka said.

In June 2017, for instance, while about 3.2 million loan applications were made, only about 1.1 million of loans were

disbursed, a 34 per cent success rate.

Jared Osoro, Director of Research and Policy at KBA added that the overall economy is hurting as a result of a worsened economic performance due to the undeniable link between credit to the private sector and output growth.

The cap was introduced at a time when credit growth was already declining, further exacerbating the credit squeeze.

Kenya

Ruling Party Sues Opposition Leaders Over Bid to Derail New Poll

President Uhuru Kenyatta’s Jubilee Party has sued opposition leader Raila Odinga and his running mate Kalonzo Musyoka at… Read more »

Kenya:Bankers Call for Removal of Interest Rate Caps

By Margaret Njugunah

Nairobi — Kenya Bankers Association is calling for the removal of interest rate capping, a year after it was passed into law.

KBA CEO Habil Olaka says the law has had adverse effects on the economy despite its good intentions.

Olaka said that the law, which was expected to provide low-cost credit and ultimately increase credit uptake has done the opposite as it has instead affected credit growth and discouraged financial inclusion. It was also expected to encourage a savings culture through increased deposits.

It was also expected to encourage a savings culture through increased deposits.

KBA, however, says that deposits – demand and fixed – have shown little evidence of being responsive to the intentions of the law.

At the same time, credit has been skewed towards secure and short-term market end, mainly away from household loans, and has shown a bias towards trade than investment loans.

“It is increasingly becoming evident that the expectations of the law are not being met. For instance, lenders are trading asset quality to portability that is tolerance of lower returns on government papers instead of lending to private sector even at the level of the cap. This is because crowding out is increasingly becoming prevalent,” Olaka said.

In June 2017, for instance, while about 3.2 million loan applications were made, only about 1.1 million of loans were

disbursed, a 34 per cent success rate.

Jared Osoro, Director of Research and Policy at KBA added that the overall economy is hurting as a result of a worsened economic performance due to the undeniable link between credit to the private sector and output growth.

The cap was introduced at a time when credit growth was already declining, further exacerbating the credit squeeze.

Kenya

Ruling Party Sues Opposition Leaders Over Bid to Derail New Poll

President Uhuru Kenyatta’s Jubilee Party has sued opposition leader Raila Odinga and his running mate Kalonzo Musyoka at… Read more »

Museveni Will Win but Only Because He Is At His Weakest

opinionBy Daniel K Kalinaki

Few people doubt President Museveni’s ability to push through the age limit constitutional amendment to allow him to run again in 2021, and possibly for life.

On the face of it, such an outcome is surprising because the proposal is widely unpopular across the country. An opinion poll by Afrobarometer found unanimous opposition to the removal of the age limit across the country regardless of gender, age, socio-economic status or region. In northern Uganda, the region with the lowest opposition to the proposal, 65 per cent said the clause should be left intact.

So why is the pragmatic money on the clause being removed? Mostly, it is because Mr Museveni is at his weakest, not his strongest.

This is rather counter-intuitive and needs some explaining.

Over the years, Mr Museveni has been able to extend his reign by exchanging tenure with a more desirable future outcome.

In 1989, it was with a promise for a new constitutional review commission to produce a new Constitution. That Constitution imposed restrictions to multiparty political activity, but it introduced a two-term limit that political rivals in and outside the Movement could wait out.

That, of course, didn’t happen because in 2003, Mr Museveni then traded in the one-party system, offering a return to multiparty politics in exchange for lifting the term limits out of the Constitution. It was brilliant politics but it required sporadic applications of violence to enforce, with flare-ups every three years (2006, 2009, 2011, 2014, 2017).

The problem with the current proposal is that Mr Museveni has no plausible political offer to make to his rivals.

The most obvious one is to offer a return of the term limits in exchange for the removal of the age limit but not only has this particular card already been played twice before, it is hard to defend alongside the quasi-legal argument that the age-limit clause is discriminatory.

Another option is to make a personal-to-holder argument for a “thank you” term or two for the incumbent while keeping the age limit and returning the term limits but this, too, doesn’t sit well with the “liberation” narrative. Revolutionaries aren’t servants to be thanked willy-nilly.

To compound matters, a slow down in the economy since around 2011 has reduced the amount of largesse available to win friends and influence people, while slowing down the number of jobs and opportunities for the hordes joining the working class.

The biggest problem here isn’t with the middle-class types who have been forced by the economic downturn to downgrade from single-malt whiskies to tummy-bloating lagers in huge, unwieldy bottles, or who now face the ignominy of paying their private school fees by installment. It is with the millions of Ugandans who, according to the latest data from the Uganda Bureau of Statistics, slipped back into poverty over the past few years.

Poor people don’t fight for what they have never had but they hate to lose whatever comforts they get.

A fellow in the village will walk miles for years without a bicycle without a complaint but try asking a boda boda rider to return to the trials and tribulations of “chest-power” bicycles.

The millions that have fallen back into poverty in recent years or are hanging onto the edge of the cliff by their gnarled fingers are the biggest opponents to the status quo. No wise words will stop their bleeding and promises of growth and prosperity down the road, even legitimate ones, are reminders of a recent future now behind them.

Mr Museveni is smart enough to look at the numbers and it is probably why he has chosen to argue the amendment on legalities (discrimination) rather than on politics (prosperity).

It is also why he has decided to do away with any civility and pretense. Parliament will be stormed, if need be.

Popular musicians carrying populist political messages of protest will be stopped from holding their concerts while their lyrics are checked carefully.

Members of Parliament will be restricted to holding consultations only within their constituencies and even these will be carefully monitored. Cabinet ministers, especially those who might have skeletons in their closets or family members under investigation, will be called upon to proclaim their support for the amendment “in order to survive”.

Mr Museveni will pull all stops to get the amendment, even if it means a return to the strong-arm tactics of past years.

After three decades in power, he is more motivated to keep what he has than his opponents who seek to gain what they have never had.

The smart money is on Mr Museveni, because he knows he is at his weakest, not his strongest.

Mr Kalinaki is a journalist and a poor man’s freedom fighter.

Twitter: @Kalinaki

South Africa:Government Exploring Solutions to Avian Influenza Outbreak

Agriculture, Forestry and Fisheries Minister Senzeni Zokwana says the department is engaging the poultry industry to find ways to tackle the avian influenza outbreak.

The Minister was in Parliament on Tuesday when the Economics Cluster Ministers fielded oral questions in the National Council of Provinces.

The H6N2 highly pathogenic avian influenza originates in China and has been spread mainly by wild birds.

The Minister said when the department became aware of the outbreak in one of the neighbouring countries, it warned farmers not to feed their chickens more food because it attracts wild birds.

Farmers were urged to ensure other birds were not able to mingle with chicks.

“But this unfortunately has been attacking mostly our commercial farmers – both laying hens and broilers. We have had a meeting with our stakeholders to look at different avenues [where] we can assist each other but unfortunately the spread has been ongoing,” he said.

The Minister was responding to a question from NCOP member Emmanuel Mlambo. He had asked if the department had any plans or mitigation strategies to curb the current avian influenza outbreak, which was threatening the South African poultry industry and jobs.

Minister Zokwana said after several engagements with industry players, a number of suggestions have been made to counter the outbreak.

“A number of suggestions have been made, like coming up with protocols that should be taken to ensure that we are able to eradicate the disease and also to look at the issue of compensation and we have come up with the formula of how people should apply to the department.”

He said a company had suggested vaccinating chickens so they are able to live with the virus. However, they were worried the market might not be keen to buy these chickens. “But we have not said out of hand that we cannot do that,” he said.

The Minister said the department has for now left the suggestion to experts for consideration.

Another suggestion has been to import fertilised eggs from countries that do not have the virus to keep the industry going.

“We feel for the industry. We feel for the employees. We believe that this spread of the disease may even culminate in the fact that we don’t have enough chicken and the prices may [be impacted].

“As a department, we are concerned but consistently we do meet with our stakeholders. We do engage them and we do listen to suggestions that come up.

“We are concerned about the sector and we will do everything to ensure that it remains a vibrant sector of our economy.”

South Africa

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Uganda:Insurance Impact Still Minimal, Says Kasaija

By Martin Luther Oketch

Insurance contributes a lot to the economic growth of society by provides stability to the functioning of process. This is because the insurance industries develop financial institutions and reduce uncertainties by improving financial resources.

Considerable attention has been devoted to evaluating the relationship between economic growth and financial market deepening. Most of what we have learned relates to banking systems and securities markets – with insurance receiving only a passing mention.

Download full magazine on What you need to know about insurance

Yet, while insurance, banking, and securities markets are closely related, insurance fulfils somewhat different economic functions than do other financial services, and in turn requires particular conditions to flourish.

In an interview with Daily Monitor recently, the Finance minister Matia Kasaija said the contribution of insurance sector in Uganda’s economy is still very minimal because there are very few insurance businesses in the country. Additionally, insurance services are not yet spread in all parts of the country.

“The insurance business in this country is still very small because many organisations/companies and people do not take insurance services,” he said.

Mr Kasaija added: “Few things are being insured because we insure very limited things thus limiting the contribution of the insurance sector in the economy.”

However, Mr Kasaija said the government is promoting the insurance sector in Uganda by providing Agriculture Insurance Scheme in partnership with the commercial banks which is currently doing well because of the subsidies being given out.

In FY 2016/17, Government operationalised the Uganda Agriculture Insurance Scheme. Statistics in the finance ministry show that a number of farmers have benefited and received insurance cover for both crops and animals, and these include; farmers under Nucafe, Centenary Bank, Cairo Bank, Advance Microfinance, Community Funds, Ifish fish farm, Dejolisa Farm, Biyinzika Farm Ltd, Sr Afro Cheeks, Eclof, Muiis Project, Kaweri, SolaceFarm, Feed the Future and FIT Uganda, Individual farmers, among others. The subsidy utilisation projections, for the current season, are as per table 4.4 below.

In FY 2017/18, the Finance ministry said Government will continue implementing the Uganda Agriculture Insurance Scheme as a pilot, to further subsidise agriculture insurance premiums for both small and large scale farmers to guarantee the returns expected from crop and livestock farming. The scheme will cover all regions of the country focusing on strategic crops and animals.

As per the Uganda Insurers Association, the prospects and businesses to be underwritten in the next six months are estimated at Shs8.2b in total premiums before applying the Government subsidy.

Uganda

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Odinga or No Odinga, Repeat Poll Must Go On – Ekuru Aukot

By Patrick Lang’at

Thirdway Alliance Kenya presidential candidate Ekuru Aukot has now dropped his opposition to inclusion of all eight candidates in the fresh election.

Dr Aukot on Saturday also said the poll will continue with or without Nasa leader Raila Odinga who dramatically withdrew on Wednesday and demanded a new election 90 days after fresh nominations.

RAILA

“The fresh election cannot be predicated on the decision of one candidate. If one candidate choses to withdraw, Kenya cannot come to a standstill,” Dr Aukot told journalists in Nairobi following repeated comments by Mr Odinga that there will be no election after he withdrew.

“Politicians in this country have a false sense of self-entitlement that the country cannot continue if they are not there.”

But even then, he said, the electoral agency was to blame.

“When a candidate writes to say they have withdrawn, why are you forcing him on the ballot? When the High Court says include the name of Aukot in the ballot, why do you go on a fishing expedition for everybody else?” Asked the former secretary of the Committee of Experts that drafted the 2010 Constitution.

But as he castigated the IEBC for forcing Mr Odinga on the poll, Dr Aukot also dropped his demands for widespread reforms at the agency, including the resignation of Chairman Wafula Chebukati before the fresh poll.

HIS PLEDGE

“After our meeting with the IEBC yesterday, we are somewhat convinced that the IEBC had addressed some of the issues pointed out by the Supreme Court as the illegalities and irregularities in the August 8 elections,” said Dr Aukot, pegging his satisfaction as “not 100 per cent”, but one he said was to give the commission the benefit of doubt.

In a lengthy statement, Dr Aukot described his candidature as the “only alternative change Kenya needs now”.

“Kenya has no shortage of leaders,” he said.

He asked Kenyans to vote for a man he said would empathise with them on the deteriorating health sector, uphold the rule of law, steer the recovery of the economy, which he said was “in the Intensive Care Unit”, and one he said had an alternative political message, different from the old order.

More follows.

Kenya

Donors Ask Odinga to Rescind Decision to Boycott Poll

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Zambia:World Bank Pays International Bank U.S.$20 Billion

By James Muyanwa

THE World Bank has paid in capital of nearly $20 billion to the International Bank for Reconstruction and Development as well as the International Finance Corporation (IFC) with increased benefits.

World Bank Group President Jim Yong Kim said that the $19 billion paid-in has yielded more than $900 billion of financing, $50 billion of reserves and $28 billion dollars in transfers to International

Development Agency (IDA) and other programmes.

Dr Kim said this in his speech at the just-ended International Monetary Fund (IMF)/World Bank annual meetings on Friday.

“This will be controversial. But I feel that we have a moral responsibility to reveal to our shareholders the powerful relationship between investing in people and economic growth. And more importantly, we’re ready to help every single country to rapidly accelerate the quality and quantity of their investments in people.

“To accomplish all of these things – to deliver what countries need at the scale you expect of us – we need more resources. Over the years, we have proven our exceptional value for money – $19 billion of total paid-in capital for IBRD and IFC, since the beginning of this institution,” he said.

“With enormous development needs and rising aspirations, demand is overwhelming. Since the 2008 financial crisis, IBRD has almost doubled its lending portfolio. IFC grew its loan portfolio threefold, and its equity portfolio fivefold, over the last 10 years,” he said.

He said that this was a critical time for the work of the World Bank Group but the good news was that global growth is robust about 2.7 per cent this year.

“Trade is picking up. But investment remains weak, and we’re concerned that downside risks such as a rise in protectionism, policy uncertainty, or possible financial market turbulence could derail this fragile recovery.

“That’s why now is the time for all countries to take action on the needed reforms to grow their economies and compete in what will surely be a more complex, demanding, and digitised future,” he said.

Dr Kim said that the World Bank felt that this was an especially important time for tackling global poverty, because there was more room to take bold action to grow the economy, protect countries from major overlapping crises, and invest in people.

“We know that official development assistance will not be enough to meet the $4 trillion per year needed to achieve the sustainable development goals, and meet the world’s rising aspirations.

“Maximizing Finance for Development means finding win-win solutions, where investors get a good return, and countries utilize these resources to meet their development goals. We’re putting this approach to work with teams from across the World Bank Group, and we’ve already seen great results,” he said.

Zambia

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Kenya: Kenya Enjoying Impact of Digital Innovation

By Maria Macharia

Nairobi — AN expert is encouraged at the uptake of digital innovation in Kenya, among other East African countries. Gilbert Saggia, the Managing Director: East Africa at SAP Africa, pointed out Kenya has made a significant progress in areas like cloud adoption, which were beneficial to the economy. “Kenya, and East Africa in general, is enjoying the positive impact of digital innovation,” Saggia said. He said for example, companies like Kenya Electricity Transmission Company had automated their business processes by moving entire infrastructure transmission projects from manual to SAP HANA.

“This is a positive stance to demonstrate that the country need to run smarter and efficient,” Saggia said. On the other hand, Commercial Bank of Africa’s investment in its workforce is yielding high returns. It started with the integrated SAP SuccessFactors platform, which allows CBA to plan, reward and retain its human capital, track performance against targets and engage in continuous learning and development.

Roopa Karemungikar, Managing Director of Altura, an SAP partner, said the ability to align all business processes across different countries would help CBA reduce paperwork, increase productivity and automate the bank transfer of salaries. With the internet of things (IoT) disrupting the African market, industry analysts, Frost & Sullivan forecasted significant growth within Kenya’s ICT market in 2017.

This would be fuelled by connectivity and convergence. Services at the Mombasa port are improving and much faster following Kenya Ports Authority’s switch to a new operational system. This has placed the port at 70 percent in the journey towards becoming a paperless port. The African Digitalisation Maturity Report indicates that Kenya has an extensive ICT infrastructure including mobile internet access. The country is more diverse and services centric which helps drives the expansion of digital services. – CAJ News

Kenya

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Nigeria:Adesoye – Maritime Dividend Key to Economy, Nation Building

By Eromosele Abiodun

The Chairman of the Nigerian Ports Authority (NPA), Emmanuel Olajide Adesoye has stated that proceeds from the maritime sector is vital to the growth of the Nigerian economy and sustainable development of the economy.

He stated this at the conference of professional Women in the Maritime and Port sector of West and Central Africa (PMAWCA) holding in Lagos.

Adesoye charged PMAWCA members to brace up and contribute most meaningfully towards Nation building in order that, ‘we join the committee of Port Nations in entrusting international best practices’.

In his goodwill message, Adesoye stated that the variables accruable from the dividends from the maritime sub-sector are critical instrument that could be utilised in nation building.

He opined that all efforts in all activities in the maritime subsector should be geared towards the generation of greater revenue in order to impact positively on the economy.

According to him, the place of greater operational efficiency in maritime operations cannot be over emphasised thus, the need to strive to always do more at all times.

He charged the women maritime professionals to stand up and be counted in this regard.

Similarly, the chairman enjoined participants at the conference to create more opportunities for others in their fold to be educated and be prepared for taking up challenges in the sub sector. He said this is another avenue abound in order to stimulate the Economy to growth.

Capacity building, Adesoye affirmed, is a variable critical tool for growth across board whilst admonishing participants to encourage themselves in the areas of career growth. He added the most effective way of achieving this is by being conscientious at work and diligent at duties.

He called on female professionals in the subsector to synergize with the multiplicity of groups and professional bodies towards synthesizing effectively new trends in technology and innovation aimed at the development of the country and the subregion at large.

On her part, the Managing Director of Nigerian Ports Authority (NPA), Hadiza Bala-Usman called on professionals in the maritime subsector to invest more in themselves in order to be indispensable in their field of endeavors.

She pointed out that the maritime and port activities in the subregion is beset with myriad of challenges ranging from decay in infrastructure to low capacity utilization, corruption, insecurity and other inefficiencies and enjoined women in the sector to initiate actions that will turn these situation for the better in the sector and to the benefit of the sub region.

While asking for increased opportunities for women in the sector, she said: “Women sure need to have more opportunities in the sector given that only 2 per cent of the world’s Maritime workforce is made up of women, according to 2015 research by the International Transport Workers Federation.”

She called on delegates to fashion out ways in which women can collectively contribute to effect the much needed change in the maritime sub-sector and the nation in general.

In their goodwill messages, the General Coordinator of Professional Women in Ports and Maritime Sector, Mrs. Adanlete Lawson and PMAWCA Secretary General, Mr. Michael Lueguje commended the Usman for her achievements so far and for the support she has given to PMAWCA over the years.

Nigeria

45 Boko Haram Members Convicted in Mass Trial

The individuals have received prison sentences, but the government has refused to divulge other details, such as the… Read more »

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