Posts tagged as: korea

High Interest Rates – President Museveni Turns Up Heat On Banks

Photo: The Daily Observer

Yoweri Museveni

By Ismail Musa Ladu

Kampala — The cost at which the country’s private sector borrows is not only prohibitively high but it also doesn’t make sense, according to President Yoweri Museveni.

Lashing out at commercial banks last week while officially opening the 25th Uganda International Trade Fair, President Museveni said interest charged on loans is unreasonably high, describing it as idiotic.

Just recently, Bank of Uganda (BoU) reduced the Central Bank Rate (CBR) from 10 to 9.5 per cent hoping that the move will persuade commercial banks into relaxing interest rates to allow private sector access affordable credit.

However, commercial banks have since then not responded in the way the Central Bank anticipated.

Most financial institutions continue to impose interest rates at an average of 24 per cent, leaving the private sector with no option but to shun borrowing.

This, according to Private Sector Foundation Uganda executive director Gideon Badagawa, is bad for the economy because it constrains the private sector ability to generate economic activities.

Speaking at the event organised by Uganda Manufacturers Association (UMA), Mr Museveni said with such high cost of credit, it is unlikely that the country’s private sector will break-even.

He said: “Borrowing at the interest of 24 per cent is idiotic.”

He added: “You cannot have high cost of interest rate, then high cost of power and then say you have minister of planning. What are they planning? These ministers should come here and explain themselves to you.”

Before the President took a swipe at the commercial banks and his ministers of Finance, Planning and Economic development, the chairperson of the UMA board of directors, Ms Barbara Mulwana, pointed out several challenges manufacturers face, including the cost of borrowing.

She said: “The high cost of capital in Uganda which is about 24 per cent per annum on average compared to less than eight per cent in major competing countries continues to render Uganda’s manufacturers uncompetitive.”

She added: “The high interest rate persists in spite of the fact that the manufacturing sector having the least default rate–non performing loans within the banking sector.”

As a result of high interest rate on loan, domestic borrowing is at an all-time low of eight per cent today.

Mr Museveni pleaded with the manufacturers to bear with him on the issue of high cost of power, saying this is a matter that will be history in a short while.

The President also blamed his predecessors, particular the late Milton Obote and Idi Amin Dada for committing policy mistakes.

He said Obote’s 1970 Nakivubo pronouncement which saw government take control of 60 per cent (up from at most 51 per cent) of more than 80 corporations in Uganda was a policy mistakes that should not have happened.

He also blamed former President Idi Amin Dada for expelling the entrepreneurial class (mainly the Indians) in 1972, saying the decisions by the two former leaders explain why Uganda which was at the same level of development with South Korea is still lagging behind.

Way forward

According to President Museveni, Islamic Banking will go a long way in solving the interest rate challenge.

He said the principle of Islamic Banking which is rooted in sharing profit and losses incurred is a good idea, describing it as a more friendly finance packaging.

As for Ms Mulwana, fast tracking roll-out of Islamic Banking here will enable the diversification of the credit market as well as provide an alternative to the expensive credit her members are grappling with and also break the monopoly the local commercial banks are enjoying.

In her remarks, Trade minister Amelia Kyambadde noted that security restored by the current government explains all the progress registered in the economy thus far.

“We are seeing key sector of the economy showing good growth. BUBU policy has been successful so far. We have put in place national development strategy and although we are still struggling with Economic Partnership Agreement (EPA) we believe we will get there,” she said.

Uganda: High Interest Rates – President Museveni Turns Up Heat On Banks

Photo: The Daily Observer

Yoweri Museveni

By Ismail Musa Ladu

Kampala — The cost at which the country’s private sector borrows is not only prohibitively high but it also doesn’t make sense, according to President Yoweri Museveni.

Lashing out at commercial banks last week while officially opening the 25th Uganda International Trade Fair, President Museveni said interest charged on loans is unreasonably high, describing it as idiotic.

Just recently, Bank of Uganda (BoU) reduced the Central Bank Rate (CBR) from 10 to 9.5 per cent hoping that the move will persuade commercial banks into relaxing interest rates to allow private sector access affordable credit.

However, commercial banks have since then not responded in the way the Central Bank anticipated.

Most financial institutions continue to impose interest rates at an average of 24 per cent, leaving the private sector with no option but to shun borrowing.

This, according to Private Sector Foundation Uganda executive director Gideon Badagawa, is bad for the economy because it constrains the private sector ability to generate economic activities.

Speaking at the event organised by Uganda Manufacturers Association (UMA), Mr Museveni said with such high cost of credit, it is unlikely that the country’s private sector will break-even.

He said: “Borrowing at the interest of 24 per cent is idiotic.”

He added: “You cannot have high cost of interest rate, then high cost of power and then say you have minister of planning. What are they planning? These ministers should come here and explain themselves to you.”

Before the President took a swipe at the commercial banks and his ministers of Finance, Planning and Economic development, the chairperson of the UMA board of directors, Ms Barbara Mulwana, pointed out several challenges manufacturers face, including the cost of borrowing.

She said: “The high cost of capital in Uganda which is about 24 per cent per annum on average compared to less than eight per cent in major competing countries continues to render Uganda’s manufacturers uncompetitive.”

She added: “The high interest rate persists in spite of the fact that the manufacturing sector having the least default rate–non performing loans within the banking sector.”

As a result of high interest rate on loan, domestic borrowing is at an all-time low of eight per cent today.

Mr Museveni pleaded with the manufacturers to bear with him on the issue of high cost of power, saying this is a matter that will be history in a short while.

The President also blamed his predecessors, particular the late Milton Obote and Idi Amin Dada for committing policy mistakes.

He said Obote’s 1970 Nakivubo pronouncement which saw government take control of 60 per cent (up from at most 51 per cent) of more than 80 corporations in Uganda was a policy mistakes that should not have happened.

He also blamed former President Idi Amin Dada for expelling the entrepreneurial class (mainly the Indians) in 1972, saying the decisions by the two former leaders explain why Uganda which was at the same level of development with South Korea is still lagging behind.

Way forward

According to President Museveni, Islamic Banking will go a long way in solving the interest rate challenge.

He said the principle of Islamic Banking which is rooted in sharing profit and losses incurred is a good idea, describing it as a more friendly finance packaging.

As for Ms Mulwana, fast tracking roll-out of Islamic Banking here will enable the diversification of the credit market as well as provide an alternative to the expensive credit her members are grappling with and also break the monopoly the local commercial banks are enjoying.

In her remarks, Trade minister Amelia Kyambadde noted that security restored by the current government explains all the progress registered in the economy thus far.

“We are seeing key sector of the economy showing good growth. BUBU policy has been successful so far. We have put in place national development strategy and although we are still struggling with Economic Partnership Agreement (EPA) we believe we will get there,” she said.

Uganda:High Interest Rates – President Museveni Turns Up Heat On Banks

Photo: The Daily Observer

Yoweri Museveni

By Ismail Musa Ladu

Kampala — The cost at which the country’s private sector borrows is not only prohibitively high but it also doesn’t make sense, according to President Yoweri Museveni.

Lashing out at commercial banks last week while officially opening the 25th Uganda International Trade Fair, President Museveni said interest charged on loans is unreasonably high, describing it as idiotic.

Just recently, Bank of Uganda (BoU) reduced the Central Bank Rate (CBR) from 10 to 9.5 per cent hoping that the move will persuade commercial banks into relaxing interest rates to allow private sector access affordable credit.

However, commercial banks have since then not responded in the way the Central Bank anticipated.

Most financial institutions continue to impose interest rates at an average of 24 per cent, leaving the private sector with no option but to shun borrowing.

This, according to Private Sector Foundation Uganda executive director Gideon Badagawa, is bad for the economy because it constrains the private sector ability to generate economic activities.

Speaking at the event organised by Uganda Manufacturers Association (UMA), Mr Museveni said with such high cost of credit, it is unlikely that the country’s private sector will break-even.

He said: “Borrowing at the interest of 24 per cent is idiotic.”

He added: “You cannot have high cost of interest rate, then high cost of power and then say you have minister of planning. What are they planning? These ministers should come here and explain themselves to you.”

Before the President took a swipe at the commercial banks and his ministers of Finance, Planning and Economic development, the chairperson of the UMA board of directors, Ms Barbara Mulwana, pointed out several challenges manufacturers face, including the cost of borrowing.

She said: “The high cost of capital in Uganda which is about 24 per cent per annum on average compared to less than eight per cent in major competing countries continues to render Uganda’s manufacturers uncompetitive.”

She added: “The high interest rate persists in spite of the fact that the manufacturing sector having the least default rate–non performing loans within the banking sector.”

As a result of high interest rate on loan, domestic borrowing is at an all-time low of eight per cent today.

Mr Museveni pleaded with the manufacturers to bear with him on the issue of high cost of power, saying this is a matter that will be history in a short while.

The President also blamed his predecessors, particular the late Milton Obote and Idi Amin Dada for committing policy mistakes.

He said Obote’s 1970 Nakivubo pronouncement which saw government take control of 60 per cent (up from at most 51 per cent) of more than 80 corporations in Uganda was a policy mistakes that should not have happened.

He also blamed former President Idi Amin Dada for expelling the entrepreneurial class (mainly the Indians) in 1972, saying the decisions by the two former leaders explain why Uganda which was at the same level of development with South Korea is still lagging behind.

Way forward

According to President Museveni, Islamic Banking will go a long way in solving the interest rate challenge.

He said the principle of Islamic Banking which is rooted in sharing profit and losses incurred is a good idea, describing it as a more friendly finance packaging.

As for Ms Mulwana, fast tracking roll-out of Islamic Banking here will enable the diversification of the credit market as well as provide an alternative to the expensive credit her members are grappling with and also break the monopoly the local commercial banks are enjoying.

In her remarks, Trade minister Amelia Kyambadde noted that security restored by the current government explains all the progress registered in the economy thus far.

“We are seeing key sector of the economy showing good growth. BUBU policy has been successful so far. We have put in place national development strategy and although we are still struggling with Economic Partnership Agreement (EPA) we believe we will get there,” she said.

Horticulture Soon to Beat Tourism in Cash Rankings

Photo: Daily News

(file photo)

By Hazla Omar

Arusha — THE horticulture industry is reported to be growing at the rate of eleven per cent annually, the fastest growing sector in the country, currently earning an average $640m.

“With such rapid growth … which now beats tourism which grows at just eight per cent, it goes to show that the horticulture is soon going to be the country’s leading foreign income earner,” points out Mr Geoffrey Simbeye, the Executive Director of the Tanzania Private Sector Foundation (TPSF).

Mr Simbeye was speaking during a special conference convened here on Monday to deliberate critical issues around horticulture transformation in the country. The conference jointly organised by the Tanzania Horticultural Association (TAHA) and the International Trade Centre (ITC), and taking place in Arusha for two days, brings together more than 200 participants both local and international stakeholders.

It also includes delegates from South Korea, whose country is way ahead in the industry; South Korea, in the course of next week would be displaying advanced farming technology targeting to revolutionise horticulture industry in Tanzania.

Korea’s horticulture industry yields an average of ten million tons of produce per year. Tanzania, meanwhile, produces around six million tonnes from horticulture.

The TAHA Executive Director Ms Jacline Mkindi says the sector was on course to raise some $ 1.3bn in a year and soon afterwards horticulture aims at beating the tourism industry’s own foreign exchange currently clocking at $2bn.

Gracing the event on behalf of the Agriculture Minister, Dr Charles Tizeba, the Mbeya Regional Commissioner, Mr Amos Makalla said at the moment the horticulture industry contributes over 43 per cent of the total agricultural produce in the country and employs at least 2.5 million people.

More than 200 participants from across mainland Tanzania and Zanzibar, some parts of Africa and South Korea are meeting in Arusha. Afterwards these will get the opportunity to visit local growers and vegetable exporters.

Mr Ji Gang Kim, the director and senior research scientist from South Korea, said his country would assist Tanzania’s horticultural sector in technology to ensure that all their harvests were better processed to add value and attract better and profitable markets abroad.

Tanzania

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Nigeria: Nigeria Woos Foreign Investors At ITU Telecom Conference

By Emma Okonji

The Nigerian delegation to this year’s ITU Telecom World, the biggest telecommunication conference and exhibition across the globe, has engaged foreign investors at various fora to attract foreign investments into the telecoms sector.

The engagement commenced with the official opening of the Nigeria Pavilion, where Nigeria showcased her innovations and products.

The event, which is holding in Busan, South Korea, also provided the opportunity to engage with small and medium enterprises (SMEs), corporates as well as top government officials.

The Nigerian delegation also engaged foreign investors at the Nigerian Investment Forum, where the country’s potential were made known to foreign investors so as to encourage them to invest in Nigeria’s broadband plan and other areas of interests.

The Nigeria Pavilion, which became a beehive of activities, showcased six SME startups and corporate sponsors who thrilled participants and investors with their unique products and services. They were later selected to join other 21 SME startups, making a total of 26 startups selected from 12 countries of the world to contest for the final pitch at the event.

The Executive Vice Chairman of NCC, Prof, Umar Danbatta, said the Nigerian delegation, led by the Permanent Secretary, Ministry of Communications, Abdulkadir Mashi, attended the ITU Telecom World 2017 to sell Nigeria’s potential that will in turn attract more foreign investments into the country.

“We come to ITU Telecom World every year to tell our story, share our experiences and borrow a leaf from global best practices to address our concerns. This year, we came to enlist the support of other players, governments, regulators and the global community from whom there is always a basket of ideas to take back home to Nigeria. The implementation of these ideas will ensure a better regulatory environment,” Danbatta said.

During the Nigeria Investment Forum, the Secretary General, International Telecoms Union (ITU), Mr. Houlin Zhao, commended Nigeria’s mission, commitment and participation at global events to woo foreign investors, and called on foreign investors to see Nigeria as a good destination for investment.

“Information and Communication Technologies (ICTs) have become indispensable. In our digital era, ICTs drive the world’s economy and the transformation of our societies. Investing in ICTs, especially in newer technologies like Internet of Things (IoT) and Artificial Intelligence (AI), will go a long way to speed up technology developments in developing countries,” Zhao said.

The Executive Secretary, Nigeria Investment Promotion Commission (NIPC), Mrs. Yewande Sadiku, who presented the keynote address at the Nigeria Investment Forum, said: “Nigeria has all it takes to drive economic growth across Africa, despite the recent rating on the ease of doing business, which placed Nigeria at 169, out of 189 countries studied.”

She said Nigeria was able to achieve reforms in various sectors of the Nigerian economy such as the issuance of Visa on arrival to foreigners to make a quick and short journey to the country, faster period of registration of businesses with Corporate Affairs Commission (CAC), and the executive order of doing business in a more transparent form. “ICT is the key to achieving the executive order on ease of doing business, and Nigeria must continue to invest in ICT and attract investments from foreign partners,” Sadiku said.

The Chairperson, Alliance for Affordable Internet (A4AI), and a former Nigeria Minister of Communications Technology, Dr. Omobola Johnson, who sat at a panel session during the Nigeria Investment Forum in South Korea, said Nigeria must continue to attract foreign investment, if the country must achieve an all inclusive government, since the country is still battling with poor infrastructure in the area of broadband deployment.

Nigeria: NCC Set to Woo Foreign Investors At ITU Telecom World 2017

By Emma Okonji

Given the contribution of telecommunications to Nigeria’s Gross Domestic Product (GDP), which stood at N1.549 trillion in the second quarter of 2017, representing 6.68 per cent increase, up from the N1.452 trillion it contributed in the first quarter of the year, the Nigerian Communications Commission (NCC), has said that the telecoms sector has all it takes to attract quality foreign investment into the country.

To that end, the Commission said it would use the opportunity of the ITU Telecoms World 2017, taking place in Busan, South Korea, from September 25-28, to further showcase the potential of Nigeria’s telecoms sector, with a view to attracting more foreign investment to the sector.

The Executive Vice Chairman of NCC, Prof. Umar Garba Danbatta, who is passionate about deepening the country’s broadband penetration as enshrined in the country’s Five-year National Broadband Plan (2013-2018), said NCC would use the event to also woo investors to invest in Nigeria’s broadband plan.

He noted that the broadband penetration in the country currently stands at 21 per cent, as Nigeria is inching toward 30 per cent penetration next year, which is in line with its national broadband target.

With less than one month to go, organisers of ITU Telecom World 2017, said the stage was set for global ICT leaders to hold conversations and debates on topics spanning the role of data in smart digital transformation, 5G, achieving meaningful digital inclusion and more.

According to the organisers, the forum would feature smart innovation in the exhibition, with over 500 exhibitors to showcase latest Information and Communications Technologies (ICTs) solutions and services that will shape the next generation of global leaders and digital experts.

The NCC is billed to host the Nigeria Investment Session at the forum, where it will further showcase the abounding opportunities for investment in the country, providing a platform for interactions between representatives of the Nigerian government, key industry players in Nigeria’s ICT and telecom sector, small and medium enterprises (SMEs) and innovators, and investors.

Featuring a line-up of panelists playing key roles across the industry in Nigeria from government, regulatory bodies and indigenous and foreign companies, the discussions at the forum, which will be led by the Minister of Communications, Adebayo Shittu, will highlight progress in meeting the goals of the National Broadband Plan, strategies to deepen connectivity and flagship programmes to drive ICT development in Nigeria.

Nigeria

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Kenyan Coffee Barista to Compete in World Aeropress Championships

Photo: Capital FM

AeroPress Championships.

By Susan Wong

Congratulations to Japheth Rapellah Oduor from Connect Coffee Roasters for winning the first ever Kenyan AeroPress Championship!

Oduor beat out a field of 15 baristas from all over Kenya, at the Kenyan AeroPress Championship held at Nairobi’s The Alchemist, on Sunday. The Championship brought some of East Africa’s most notable coffee specialists together, such as Vava Angwenyi from Vava Coffee, Bruck Fikru from Volcafe, Benjamin Carlson of Long Miles Coffee, Mbula Musau, Martin Shabaya the head barista of the Artcaffe Group, and Raphaël Prime from the Specialty Coffee Trader at C. Dorman Ltd.

The World AeroPress Championships (WAC) have been going on for 10 years, and despite going international, the celebration of the AeroPress and the coffee brewing process to yield the smoothest, richest cup of coffee has remained a very grassroots event, and is uniquely organised in each country.

This year, there are more than 60 countries participating and over 90 events in total (including regional events). The winners from each country will be competing at the World Aeropress Championships in Seoul, Korea in early November.

Kenya

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Striving for Peace, Decent Life for All, ‘Very Pertinent’ UN Assembly Theme, Says Ugandan President

Yoweri Kaguta Museveni, President of the Republic of Uganda, took the podium expressing support for the theme of the United Nations 72nd General Assembly – ‘Focusing on People: Striving for Peace and a Decent life for all on a Sustainable Planet’ – questioning why the world’s elites failed to see its pertinence.

“Who would lose if all the people on the globe led a decent life,” he said, namely by having enough food; inoculations for “immunizable” diseases; drinkable water; education; clean electricity; fair-paying jobs; and respectable homes. “Parasitism is the only obstacle to global affluence, prosperity and peace,” he added.

Turning to “the dangerous situation on the Korean Peninsula,” he believed that, as “kith and kin,” the Republic of Korea (ROK) and the Democratic Republic of Korea (DPRK) would do well to alone discuss their re-unification. He cited a unified Viet Nam, as well as that of Germany in 1990. Noting the strength of a unified Korea, he posed the queries, “Why do some actors fear strong nations in the world? Why should the Koreans themselves (North and South) allow external forces to continue to divide them?”

“We always strive not to allow actors, foreign or local, to divide the African peoples, regardless of the complications involved,” he underscored, saying that Uganda accommodates many African refugees on account of a conscious ideological position – “not to allow any actors to divide us. We only fight traitors.”

On “the small issue” of enforcing sanctions against the DPRK, Mr. Kaguta told the Assembly that Uganda is in compliance. “We do not have to trade with North Korea. We are, however, grateful that, in the past, the North Koreans helped us to build our tank forces,” he concluded.

Uganda

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JKUAT Enters Partnership to Create Sustainable Startups

A new partnership between JKUAT, World Best Friend and EMCAST (both of South Korea) has been formed in a bid to create sustainable startups in IT that create value and wealth for the youth of Kenya under a tripartite agreement.

Accelerating Growth

In the agreement signed, September, 6, 2016, the three parties will establish an incubation center aimed at nurturing IT experts with practical knowledge and accelerating growth driven entrepreneurs through education, mentorship and financing.

Lauding the partnership, Vice chancellor, Prof. Mabel Imbuga, acknowledged the potential of the center in curtailing the unemployment menace among the youth and women of this country.

“I am confident that the projects and startups incubated in the center will lead to viable ventures thus leading to employment of our youth and women,” said Prof Imbuga in a press statement.

Acknowledging the strength of the University especially in IT, Prof. Imbuga said the collaboration will bey key in harnessing students creativity to come up with solutions that tackle problems affecting the country.

On his Part, World Best Friend CEO, Park Young Hak, said the partnership will cultivate startups and IT practitioners through ‘learning by doing’ so that they can be equipped with the skills that can meet the market needs and investors demands.

“It is my hope that the startups incubated in the center will be innovative and sustainable hence enhancing the wellbeing of the youth in Kenya,” said Mr. Young.

Ms. Neena Gichaara of EMCAST, said her company will provide networking opportunities for the youth involved in the center with peers, mentors and investors and hoped that it will lead to the commercialisation of the incubated projects.

On her part, the Deputy Vice Chancellor (Research, Production and Extension) Prof. Mary Abukutsa, said JKUAT values collaborations that bear fruit and was confident that the collaboration will yield tangible results.

s also addressed by World Best Friend Chairman, Mr. Lucah Rotich, Deputy Vice Chancellor, Academic Affairs, Prof. Romanus Odhiambo and Director Linkages, Dr. Kaibui Mwikamba. The MoU will remain in force for three years at the end of which all parties will review the collaboration.

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Court Battle Pitting BoU Against Ex-Crane Bank Owner Begins

The hearing of the case pitting Uganda’s banking regulator against real estate mogul and former owner of Crane Bank, Suphir Ruparelia, begun Wednesday at Kampala High Court.

The Bank of Uganda (BoU) accuses the businessman of siphoning $105 million from the collapsed Crane Bank over a 10-year period.

Further, BoU accuses Mr Ruparelia of fraudulently grabbing 48 properties built with Crane Bank money that he later transferred to Meera Investments, his real estate business, before leasing them back to the bank at exorbitant prices. The Central Bank is suing Mr Ruparelia and Meera Investments jointly.

The Central Bank wants Mr Ruparelia to pay back over Ush650 billion ($178.2 million), for the 48 properties, that includes interest in addition to handing over the titles.

BoU took over the management of Crane Bank in September last year, citing that the bank was “grossly undercapitalised and paused a systemic risk to the financial sector.” The Central Bank later sold the lender to DFCU Bank.

In his defence and in a counter suit against BoU, the businessman accuses the Central Bank of failing to properly execute its supervisory functions, which he says led to the collapse of his bank.

He also alleges that BoU wrote him a letter blackmailing him to settle the case out-of-court or face criminal proceedings after they had filed their plaint in June.

The real estate magnate also accuses BoU lawyers –MMAKS and AF Mpaga– of conflict of interest and faults the Central Bank for breach of Confidential Settlement and Release Agreement. He says the two law firms have represented his Meera Investments firm.

The court battles, president over by Justice David Wangutusti, is likely to open a Pandora’s box for the Central Bank.

At least two other suits against BoU have been filed by private citizens over the collapse of Crane Bank.

Uganda

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