<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="820" height="547" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/08/UGANDA-SHILLING.jpg" alt="" class="wp-image-524644" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/08/UGANDA-SHILLING.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/UGANDA-SHILLING-300x200.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/UGANDA-SHILLING-135x90.jpg 135w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/UGANDA-SHILLING-768x512.jpg 768w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">Uganda shillings. Uganda. (Photo by: Godong/Universal Images Group via Getty Images)</figcaption></figure>



KAMPALA, Aug 29 (Reuters)&nbsp;&#8211;&nbsp;The Ugandan shilling&nbsp;UGX=&nbsp;was little-changed on Thursday, with some inflows of dollars from offshore investors who participated in this week&#8217;s Treasury auction giving support, traders said.



At 1046 GMT, commercial banks quoted the shilling at 3,710/3,720, compared with Wednesday&#8217;s closing rate of 3,712/3,722.



(Reporting by Elias Biryabarema;Editing by George Obulutsa)

UGANDA SHILLING

Ugandan shilling steady, offshore investor FX flows offer support

<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="720" height="471" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/08/shilling-1.avif" alt="A teller counts Kenya shilling notes inside the cashier's booth at a forex exchange bureau in Kenya's capital Nairobi, April 20, 2016. REUTERS/Thomas Mukoya/File Photo" class="wp-image-524625"/></figure>



NAIROBI, Aug 29 (Reuters) &#8211; The Kenyan shilling KES= was flat on Thursday, as month-end hard-currency demand from the manufacturing sector was offset by foreign investor inflows for the local bond market, traders said. At 0835 GMT, LSEG data showed the shilling at 128.25/129.25 to the U.S. dollar, the same as at the close of Wednesday&#8217;s session. &#8220;It&#8217;s very stable. Demand and supply seem to be evenly matched. There&#8217;s been some good (FX) demand but offshore flows are coming for the infrastructure bond,&#8221; one trader said. The shilling has been relatively steady for several months, after rallying strongly in the first half of 2024 as concerns eased that the East African country would default on a $2 billion Eurobond that matured in June. (Reporting by Hereward HollandEditing by Alexander Winning)

shilling

Kenyan shilling flat as FX inflows meet manufacturing demand

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="429" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/HCVRNAVJRJMOJBUK4XOB7PEJGY-820x429.jpg" alt="" class="wp-image-506011" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/HCVRNAVJRJMOJBUK4XOB7PEJGY-820x429.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/HCVRNAVJRJMOJBUK4XOB7PEJGY-300x157.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/HCVRNAVJRJMOJBUK4XOB7PEJGY-160x84.jpg 160w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/HCVRNAVJRJMOJBUK4XOB7PEJGY-768x402.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/HCVRNAVJRJMOJBUK4XOB7PEJGY.jpg 1200w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">A teller serves a client with Kenya shilling notes at the cashier&#8217;s booth of a forex exchange bureau in Kenya&#8217;s capital Nairobi, April 20, 2016. REUTERS/Thomas Mukoya/File Photo</figcaption></figure>



NAIROBI, Aug 28 (Reuters) &#8211; The Kenyan shilling strengthened a little on Wednesday, with foreign exchange inflows from tea exporters slightly outweighing month-end demand from the manufacturing sector, traders said.



At 0935 GMT, LSEG data showed the shilling at 128.25/129.25 to the U.S. dollar, compared to 128.50/129.50 at the close of Tuesday&#8217;s session.



&#8220;The major (foreign-currency) supply is from our agricultural sector. Also the central bank is in the market, buying dollars to prevent volatility,&#8221; one trader said.



(Reporting by Hereward Holland; Editing by Alexander Winning)

HCVRNAVJRJMOJBUK4XOB7PEJGY

Kenyan shilling strengthens slightly on tea exporter FX inflows

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="429" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/08/LYEEWJTJKRPK3GJPCKWFP3EK7E-820x429.jpg" alt="" class="wp-image-519304" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/08/LYEEWJTJKRPK3GJPCKWFP3EK7E-820x429.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/LYEEWJTJKRPK3GJPCKWFP3EK7E-300x157.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/LYEEWJTJKRPK3GJPCKWFP3EK7E-160x84.jpg 160w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/LYEEWJTJKRPK3GJPCKWFP3EK7E-768x402.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/LYEEWJTJKRPK3GJPCKWFP3EK7E-1536x804.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/LYEEWJTJKRPK3GJPCKWFP3EK7E.jpg 1920w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">A teller counts Kenya shilling notes inside the cashier&#8217;s booth at a forex exchange bureau in Kenya&#8217;s capital Nairobi, April 20, 2016. REUTERS/Thomas Mukoya/File Photo</figcaption></figure>



NAIROBI, Aug 27 (Reuters) &#8211; The Kenyan shilling was steady on Tuesday, with foreign exchange inflows from the diaspora matching muted demand from fuel importers and manufacturers, traders said.



At 0822 GMT, LSEG data showed the shilling at 128.25/129.25 to the U.S. dollar, the same level it closed on Monday.



(Reporting by Hereward Holland; Editing by Alexander Winning)

LYEEWJTJKRPK3GJPCKWFP3EK7E

Kenyan shilling steady as diaspora FX inflows match demand

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="547" src="https://cms.cnbcafrica.com/wp-content/uploads/2023/02/GettyImages-924883576-1-820x547.jpg" alt="" class="wp-image-422955" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2023/02/GettyImages-924883576-1-820x547.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2023/02/GettyImages-924883576-1-300x200.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2023/02/GettyImages-924883576-1-135x90.jpg 135w, https://cms.cnbcafrica.com/wp-content/uploads/2023/02/GettyImages-924883576-1-768x512.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2023/02/GettyImages-924883576-1-1536x1024.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2023/02/GettyImages-924883576-1-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">Uganda shillings. Uganda. (Photo by: Godong/Universal Images Group via Getty Images)</figcaption></figure>



KAMPALA, Aug 26 (Reuters) &#8211; The Ugandan shilling  was marginally firmer against the U.S. dollar on Monday, with some end-month inflows of hard currency from non-governmental organisations helping lend support to the local currency, traders said.



At 0920 GMT commercial banks quoted the shilling at 3,707/3,717, a notch firmer than Friday&#8217;s close of 3,710/3,720.



(Reporting by Elias Biryabarema; Editing by)

GettyImages-924883576-1

Ugandan shilling firms slightly on aid agency inflows

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="547" src="https://cms.cnbcafrica.com/wp-content/uploads/2020/09/Kenya-Shilling-banknotes-and-coins-820x547.jpg" alt="" class="wp-image-381494" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2020/09/Kenya-Shilling-banknotes-and-coins-820x547.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2020/09/Kenya-Shilling-banknotes-and-coins-300x200.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2020/09/Kenya-Shilling-banknotes-and-coins-768x512.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2020/09/Kenya-Shilling-banknotes-and-coins-1536x1024.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2020/09/Kenya-Shilling-banknotes-and-coins-scaled.jpg 2048w, https://cms.cnbcafrica.com/wp-content/uploads/2020/09/Kenya-Shilling-banknotes-and-coins-1110x740.jpg 1110w, https://cms.cnbcafrica.com/wp-content/uploads/2020/09/Kenya-Shilling-banknotes-and-coins-696x464.jpg 696w, https://cms.cnbcafrica.com/wp-content/uploads/2020/09/Kenya-Shilling-banknotes-and-coins-1068x712.jpg 1068w, https://cms.cnbcafrica.com/wp-content/uploads/2020/09/Kenya-Shilling-banknotes-and-coins-1920x1280.jpg 1920w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">Kenyan shilling banknotes and coins sit arranged at a market stall in Mombasa, Kenya, on Thursday, Nov. 23, 2017. The countrys Treasury has already cut this years growth target to 5 percent from 5.9 percent as the protracted election furor damped investment and a drought curbed farm output. Photographer: Luis Tato/Bloomberg</figcaption></figure>



NAIROBI, Aug 26 (Reuters) &#8211; The Kenyan shilling was stable on Monday, with traders saying market activity was muted despite S&amp;P Global downgrading the country&#8217;s sovereign credit rating late on Friday.



At 0813 GMT, LSEG data showed the shilling at 128.50/129.50 to the U.S. dollar, the same level it closed on Friday.



The shilling has traded relatively evenly in recent weeks, shrugging off major protests that started in June and forced the government to abandon tax hikes contained in the government&#8217;s annual finance bill.



S&amp;P downgraded Kenya&#8217;s rating deeper into &#8220;junk&#8221; territory, to &#8216;B-&#8216; from &#8216;B,&#8217; citing the repeal of the latest year&#8217;s finance bill, which it said will slow fiscal consolidation.



&#8220;The market&#8217;s dead. Everyone is just holding off. Nobody is keen on buying, they&#8217;re just covering some small positions,&#8221; one trader said.



(Reporting by Hereward Holland; Editing by Alexander Winning)

General Economy As Kenya Faces Bleak 2018 Outlook In Vote Aftermath

Kenyan shilling steady in muted trade; no reaction to S&P downgrade

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="547" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/08/GettyImages-2162879043-820x547.jpg" alt="" class="wp-image-522325" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/08/GettyImages-2162879043-820x547.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/GettyImages-2162879043-300x200.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/GettyImages-2162879043-135x90.jpg 135w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/GettyImages-2162879043-768x512.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/GettyImages-2162879043-1536x1024.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/GettyImages-2162879043-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">BUDAPEST, HUNGARY &#8211; JULY 21: Lewis Hamilton of Great Britain and Mercedes waves to the crowd on the drivers parade prior to the F1 Grand Prix of Hungary at Hungaroring on July 21, 2024 in Budapest, Hungary. (Photo by Dean Mouhtaropoulos/Getty Images)</figcaption></figure>



ZANDVOORT, Netherlands, (Reuters) &#8211; Lewis Hamilton said on Thursday the time was right for a Formula One race in Africa and he was working behind-the-scenes with Rwanda and South Africa to try to make it happen.



The seven-times world champion spoke to reporters at the Dutch Grand Prix after visiting Africa during the sport&#8217;s August break.



&#8220;The time&#8217;s 100% right. We can&#8217;t be adding races in other locations and continue to ignore Africa, which the rest of the world just takes from. No one gives anything to Africa,&#8221; said the Mercedes driver.



&#8220;I think having a Grand Prix there will really be able to highlight just how great the place is and bring in tourism and all sorts of things. Why are we not on that continent?



&#8220;There is at least one track that&#8217;s ready. In the short term, we should just get on that track and have that part of the calendar, and then work on building out something really cool.&#8221;



Formula One has long wanted to return to Africa for the first time since South Africa&#8217;s Kyalami circuit last hosted a race in 1993, but financial issues have been a major obstacle.



Formula One chief executive Stefano Domenicali said this month that Rwanda wanted to host a race at a permanent circuit, yet to be built, and there would be further discussions in September.



Hamilton, Formula One&#8217;s first and only Black driver, said he would also be speaking with Domenicali.



&#8220;Rwanda is one of my favourite places I&#8217;ve been to actually. I&#8217;ve been doing a lot of work in the background on it,&#8221; said the Briton.



&#8220;I&#8217;ve spoken to people in Rwanda, I&#8217;ve spoken to people in South Africa. That&#8217;s a longer project, Rwanda, but it&#8217;s amazing that they&#8217;re so keen to get a part of it.&#8221;



The 39-year-old Briton has made several visits to Africa with the United Nations refugee agency UNHCR and his latest trip took him to Morocco, Senegal, Benin, Mozambique and Madagascar.



&#8220;I&#8217;m still digesting the trip to be honest. Going to a refugee camp and seeing the work that is being done there and how people who are displaced are affected,&#8221; he said.



&#8220;It&#8217;s one thing reading about it, or hearing on the news, but actually seeing and speaking to kids who are walking 10km to get to school just to have an education and then 10k back and not having school meals and being able to eat during the day.



&#8220;That was really heavy to see and experience and then the history of Senegal and seeing the slave areas was really heavy as well.



&#8220;Through all those experiences I feel it&#8217;s just adding to my compass of what I want to do moving forwards,&#8221; said Hamilton.



(Reporting by Alan Baldwin, editing by Clare Fallon)

F1 Grand Prix of Hungary

Hamilton working with Rwanda and South Africa on F1 race plans

<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="720" height="425" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/06/ANCK25OQIFMHTJYACOM5XU5T24.jpg" alt="" class="wp-image-498541" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/06/ANCK25OQIFMHTJYACOM5XU5T24.jpg 720w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/ANCK25OQIFMHTJYACOM5XU5T24-300x177.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/ANCK25OQIFMHTJYACOM5XU5T24-152x90.jpg 152w" sizes="auto, (max-width: 720px) 100vw, 720px" /><figcaption class="wp-element-caption">Kenya shilling coins and notes are pictured inside a cashier&#8217;s booth at a forex exchange bureau in Kenya&#8217;s capital Nairobi, April 20, 2016. REUTERS/Thomas Mukoya/File Photo</figcaption></figure>



Aug 22 (Reuters)&nbsp;&#8211;&nbsp;The Kenyan and Ugandan shillings are expected to strengthen against the dollar in the coming week to Thursday, while Zambia&#8217;s kwacha and Ghana&#8217;s cedi are seen weakening and Nigeria&#8217;s naira as holding steady, traders said.



<h2 class="wp-block-heading" id="h-kenya">KENYA</h2>



Kenya&#8217;s shilling is expected to firm slightly in the coming week as foreign currency demand from the manufacturing and fuel sector appears to have waned.



Commercial banks quoted the shilling at 128.50/129.50 per dollar on Thursday, the same level it closed last Thursday.



&#8220;I&#8217;m hoping a bit more demand might come onto the market, or it&#8217;s likely to strengthen,&#8221; said one trader at a commercial bank.



<h2 class="wp-block-heading" id="h-nigeria">NIGERIA</h2>



Nigeria&#8217;s naira is seen holding steady around current levels on the official market next week amid expectations that the central bank will sell dollars to ease rising demand.



LSEG data showed the naira was quoted at 1,580 to the dollar on the official market on Thursday, around the same level a week ago. The unit sold at about 1,605 on the parallel market on Thursday.



This week, the Central Bank of Nigeria (CBN) reported a record $553 million in remittance inflows for July, a 130% rise from a year ago.



&#8220;The major take is that importers expect the CBN will intervene in the market, which will help to clear outstanding demand,&#8221; one trader said.



<h2 class="wp-block-heading" id="h-ghana">GHANA</h2>



Ghana&#8217;s cedi is likely to slip next week as investors looked to purchase hard currency amid poor forex supply.



LSEG data showed the cedi trading at 15.58 to the dollar, from 15.55 at last Thursday&#8217;s close.



&#8220;After a couple of weeks of relative strength, the cedi faltered a bit following the government&#8217;s coupon payment on the DDEP (Domestic Debt Exchange Programme) bonds as investors looked to purchase hard currency,&#8221; Sedem Dornoo, a senior trader at Absa Bank Ghana, said.



&#8220;We expect to see some more pressure on the local unit next week but do not reckon the pair will rise too high, especially amidst continued support from the central bank, who&#8217;ve sold roughly $71 million in three 7-day FX forward auctions in the past week,&#8221; he added.



Another trader said the central bank&#8217;s intervention had helped to save the cedi from steep losses against the dollar.



<h2 class="wp-block-heading" id="h-uganda">UGANDA</h2>



The Ugandan shilling is seen trading with a strengthening tone in the coming days as typical end-month inflows of hard currency from some non-governmental organisations (NGOs) lend support to the local currency, traders said.



Commercial banks quoted the shilling at 3,707/3,717 on Thursday, compared to the last Thursday&#8217;s close of 3,720/3,730.



&#8220;Charity flows are expected as we head into the last days of the month, the local unit will draw a bit of support from that,&#8221; said an independent foreign exchange trader.



Charities convert part of their donations which they receive in hard currency to shillings to meet end-month operational expenses.



<h2 class="wp-block-heading" id="h-zambia">ZAMBIA</h2>



Zambia&#8217;s kwacha is likely to come under mild pressure against the dollar next week due to sustained greenback demand from importers amidst scant supply.



On Thursday, the currency of Africa&#8217;s second-largest copper producer was trading at 25.9220 per dollar from 26.2500 a week ago.



&#8220;With inflows thinning out and demand picking up, we anticipate the local unit to weaken slightly in the short term,&#8221; Zambia National Commercial Bank said in a note.



(Reporting by Christian Akorlie, Chris Mfula, Hereward Holland, Elias Biryabarema and Elisha Bala-Gbogbo; Editing by David Holmes)

ANCK25OQIFMHTJYACOM5XU5T24

Kenyan and Ugandan shilling to firm, Zambia’s currency seen falling

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="521" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/08/RLVCCF47LVIWPJR4O2PPITYMVI-820x521.jpg" alt="" class="wp-image-516586" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/08/RLVCCF47LVIWPJR4O2PPITYMVI-820x521.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/RLVCCF47LVIWPJR4O2PPITYMVI-300x191.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/RLVCCF47LVIWPJR4O2PPITYMVI-142x90.jpg 142w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/RLVCCF47LVIWPJR4O2PPITYMVI-768x488.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/RLVCCF47LVIWPJR4O2PPITYMVI-1536x976.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/RLVCCF47LVIWPJR4O2PPITYMVI.jpg 1920w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">A teller handles U.S. dollar banknotes and Kenya shilling banknotes inside the cashier&#8217;s booth at a forex exchange bureau in downtown Nairobi, Kenya, February 16, 2024. REUTERS/Thomas Mukoya/File Photo</figcaption></figure>



NAIROBI, Aug 22 (Reuters) &#8211; Kenya&#8217;s shilling held steady against the U.S. dollar on Thursday, as foreign currency inflows matched demand from manufacturing and other sectors, traders said.



At 0849 GMT, LSEG data quoted the shilling at 128.50/129.50 to the dollar, the same level as it closed on Wednesday.



&#8220;Supply is there but it&#8217;s being gobbled by the small demand on the market from manufacturing and other sectors,&#8221; one trader said.



(Reporting by Hereward Holland; Editing by Elisha Bala-Gbogbo)

RLVCCF47LVIWPJR4O2PPITYMVI

Kenyan shilling trades flat, manufacturing demand matches supply

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="547" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-1604532392-820x547.jpg" alt="" class="wp-image-510212" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-1604532392-820x547.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-1604532392-300x200.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-1604532392-135x90.jpg 135w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-1604532392-768x512.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-1604532392-1536x1024.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-1604532392-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">A worker at a foreign exchange currency bureau counts 1000 Ugandan shilling banknotes in Kampala, Uganda, on Wednesday, Aug. 16, 2023. Uganda&#8217;s central bank said it stands ready to act if the World Bank&#8217;s decision to halt new funding over the country&#8217;s passage of anti-LGBTQ legislation impacts the currency further. Photographer: Luke Dray/Bloomberg via Getty Images</figcaption></figure>



KAMPALA, Aug 22 (Reuters) &#8211; The Ugandan shilling was trading stronger on Thursday, lifted by inflows of hard currency from non-governmental organisations (NGOs) and a slump in demand, traders said.



At 0833 GMT commercial banks quoted the shilling at 3,707/3,717, compared to Wednesday&#8217;s close of 3,717/3,727.



(Reporting by Elias Biryabarema; Editing by Hereward Holland)

Ugandan Economy Following Rate Cut

Ugandan shilling firms on low demand, charity inflows

<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="2048" height="1365" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/02/STGRVJG24JLG5H7LHUH3IYPOV4-scaled.jpg" alt="" class="wp-image-459177" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/02/STGRVJG24JLG5H7LHUH3IYPOV4-scaled.jpg 2048w, https://cms.cnbcafrica.com/wp-content/uploads/2024/02/STGRVJG24JLG5H7LHUH3IYPOV4-300x200.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/02/STGRVJG24JLG5H7LHUH3IYPOV4-820x547.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/02/STGRVJG24JLG5H7LHUH3IYPOV4-135x90.jpg 135w, https://cms.cnbcafrica.com/wp-content/uploads/2024/02/STGRVJG24JLG5H7LHUH3IYPOV4-768x512.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/02/STGRVJG24JLG5H7LHUH3IYPOV4-1536x1024.jpg 1536w" sizes="auto, (max-width: 2048px) 100vw, 2048px" /><figcaption class="wp-element-caption">FILE PHOTO: A sign board is seen near the Sibanye gold mine in Westonaria, west of Johannesburg, April 6, 2016. REUTERS/Siphiwe Sibeko</figcaption></figure>



Aug 22 (Reuters)&nbsp;&#8211;&nbsp;Sibanye Stillwater&nbsp;SSWJ.J&nbsp;has secured a 500 million euros ($557.30 million) financing package to complete its Keliber lithium project in Finland, the miner said on Thursday.



The South African company owns 79.8% of Keliber after it invested in the project in 2021 to diversify away from platinum and gold production into battery metals amid a global shift towards cleaner energy.



State-owned Finnish Minerals Group and other Finnish investors own the remaining stake in the Keliber project.



Sibanye got 250 million euros from export credit guarantee agencies including Finland&#8217;s state-owned Finnvera, 150 million euros from the European Investment Bank and a syndicated tranche of 100 million euros from commercial banks.



The funding meets Keliber&#8217;s final capital expenditure requirements of about 667 million euros to complete the project, Sibanye said. About 250 million euros was previously raised through equity.



&#8220;The financing solution that has now been secured enables the construction phase to be completed and the production of battery-grade lithium hydroxide to begin,&#8221; Matti Hietanen, CEO of Finnish Minerals Group, said.



When completed, Keliber is expected to have annual production of about 15,000 metric tons of battery-grade lithium hydroxide monohydrate for at least 16 years, according to Sibanye&#8217;s website.



Sibanye CEO Neal Froneman said the funding provided by European lenders showed the project&#8217;s &#8220;strategic importance to the European clean energy transition&#8221;.



The funding also &#8220;significantly improves the group&#8217;s liquidity, effectively ring-fencing the existing group facilities for operational requirements&#8221;, Froneman added.



On Wednesday, Sibanye said it had agreed a $101 million gold prepayment deal to raise cash to help repay loans after a slump in platinum group metal prices hurt its income.



It has also agreed to refinance its 5.5 billion rand ($306.86 million) revolving credit facility with South African banks, which was increased to 6 billion rand.



($1 = 0.8972 euros)



($1 = 17.9233 rand)



(Reporting by Nelson Banya; Editing by Shounak Dasgupta)

FILE PHOTO: FILE PHOTO: A sign board is seen near the Sibanye gold mine in Westonaria

Miner Sibanye gets 500 mln euros financing to complete Finland lithium project

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="565" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/08/APQE2ALP6RL6DHFPPT6WZO3ITU-820x565.jpg" alt="" class="wp-image-521910" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/08/APQE2ALP6RL6DHFPPT6WZO3ITU-820x565.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/APQE2ALP6RL6DHFPPT6WZO3ITU-300x207.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/APQE2ALP6RL6DHFPPT6WZO3ITU-131x90.jpg 131w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/APQE2ALP6RL6DHFPPT6WZO3ITU-768x529.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/APQE2ALP6RL6DHFPPT6WZO3ITU-1536x1058.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/APQE2ALP6RL6DHFPPT6WZO3ITU-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">Samburu pastoralist slaughter livestock in the de-stocking of emaciated animals in a program by the government and the Kenya Red Cross to buy livestock, slaughter and distribute the meat as relief food to the most affected families following a prolonged drought near Lengusaka in Wamba, Samburu county, Kenya July 27, 2022. REUTERS/Thomas Mukoya</figcaption></figure>



KILIFI COUNTY, Kenya, Aug 22 (Thomson Reuters Foundation)&nbsp;&#8211;&nbsp;When farmer Teresa Kahindi harvested nearly two tonnes of maize two years ago amid a severe drought, her neighbours in the Kenyan coastal county of Kilifi accused her of witchcraft.



Many of her fellow farmers had not produced even a single sack, weighing about 90 kg, of the staple, during the fifth consecutive season of almost no rain in eastern Kenya, where arid conditions can devastate harvests.



&#8220;They said I was a witch,&#8221; said Kahindi, 53, while strolling through her fields of black-eyed peas, mung beans, cassava, finger millet and sunflowers.&#8221;But it&#8217;s not true. We can&#8217;t farm like we used to do. Now we must rely on climate forecasts.&#8221;



Kahindi&#8217;s drought-defying harvest was thanks to a sophisticated early-warning system that includes cutting-edge meteorological data, radio and text alerts and on-the-ground teams that ensure communities can take pre-emptive action to avoid crop losses.



In March 2022, a month before the rainy season was due to begin, Kahindi was advised to adapt her plans at a seminar for farmers run by county officials.



She prepared her plots with manure to enhance water retention, covered the soil with dry grass mulching to reduce evaporation and planted drought-tolerant maize seeds, which require less water and mature faster than other varieties.



&#8220;Knowledge can transform farming,&#8221; says Kahindi.



Kenya&#8217;s early warning system, funded by the government and a patchwork of international agencies, may offer a template for countries to meet the United Nation&#8217;s 2022 goal to protect &#8220;all people on Earth&#8221; by 2027 through early warning systems.



The U.N. launched the Early Warnings for All Action Plan for Africa in Kenya&#8217;s capital of Nairobi last year in an effort to accelerate a slow rollout in other parts of the continent.



&#8220;In terms of early warning, Kenya stands out as a big brother for East Africa,&#8221; said Zablon Shilenje, the World Meteorological Organization&#8217;s coordinator for Africa.



<h2 class="wp-block-heading" id="h-reducing-famine-risk">REDUCING FAMINE RISK</h2>



As extreme weather events increase due to manmade climate change, the Kenyan model allows farmers to switch agricultural techniques or the crops they cultivate to adapt to predicted conditions, such as intense droughts or heavy floods.



Between 2020 and 2022, the Horn of Africa suffered its worst drought in at least 70 years, exacerbated by the climate phenomenon La Niña. Some 23 million people required humanitarian aid at a cost of more than $1.8 billion.



More people will be exposed to drought as the region&#8217;s population is set to double to 400 million by 2055.



Food security experts say Kenya&#8217;s early warning system has mitigated the impact of disasters – in turn minimising the likelihood of famine in one of the world&#8217;s most food insecure regions.



Between 2010 and 2011, when repeated droughts struck the East African nation, 2.8 million Kenyans were left &#8220;severely hungry.&#8221;



Thanks to early warnings, a million fewer people suffered during similar droughts in 2016 and 2017, even as the U.S. government halved its spending on food aid, according to a report by the U.S. Agency for International Development, or USAID.



The effort to predict droughts dates back to 1985 with the founding of the Famine Early Warning Systems Network (FEWS NET), a USAID-funded programme that began in the aftermath of a catastrophic Ethiopia famine but now covers more than 50 countries.



Supported by Kenya&#8217;s National Drought Management Authority (NDMA) and Agriculture Ministry, as well as international NGOs, the system uses high-resolution satellite, crop and other climate data to predict the risk of drought, sometimes up to eight months in advance.



Local authorities interpret, verify and communicate forecasts to millions of farmers through radio, television, SMS and WhatsApp messages and sometimes provide them with subsidised fertilisers and seeds.



&#8220;We are able to foresee severe events in a timely manner,&#8221; said David Gikungu, director of the Kenya Meteorological Department.



<h2 class="wp-block-heading" id="h-come-a-long-way">&#8216;COME A LONG WAY&#8217;</h2>



Advances in data collection, modelling and satellite monitoring have helped make early warning more reliable over the years, said Chris Funk, director of the Climate Hazards Center at UC Santa Barbara, which processes most of FEWS NET&#8217;s data.



Other improvements include an understanding of the complex climatic conditions that drive drought in the Horn of Africa and the region&#8217;s communications infrastructure.



&#8220;We&#8217;ve really come a long way,&#8221; Funk said. &#8220;We have an impressive suite of tools now. It&#8217;s been successful in stopping people from starving.&#8221;



A study of FEWS NET data by U.S. researchers found 92 percent of early warnings in Kenya were accurate, aided by better monitoring of socioeconomic factors, such as food prices and violent conflict.



While Kenya&#8217;s early warning system is now highly accurate at predicting natural disasters, critics say decisionmakers don&#8217;t always act on time or with enough financial support.



&#8220;Unless the government and other stakeholders put up the resources, then it can&#8217;t work,&#8221; said James Odour, NDMA&#8217;s director from 2012 to 2022.



&#8220;Unless action is taken on the early warning, then it&#8217;s pointless.&#8221;



Nelson Mutanda, responsible for early warning systems at the NDMA, said the government instructed counties to allocate 2% of their annual budgets to early warning and gave local authorities the responsibility of managing funds.



&#8220;Counties have enough budget (to fund early warnings),&#8221; he said. &#8220;But some don&#8217;t prioritise it. They can&#8217;t come crying to us for support just because they haven&#8217;t properly prepared.&#8221;



He added: &#8220;And we expect farmers who are capable should take initiative without waiting for funding.&#8221;



<h2 class="wp-block-heading" id="h-last-mile">&#8216;LAST MILE&#8217;</h2>



Research suggests pre-emptive intervention can save billions of dollars. A 2022 report by the World Bank found that spending $1 billion on early warnings can avert $35 billion of disaster-related losses annually.



Another major challenge is disseminating warnings to rural populations.



In Kenya&#8217;s southern county of Kajiado, home to the pastoralist Indigenous Maasai, drought warnings may not be understood, due to illiteracy rates, or sometimes are not even delivered when there are gaps in government or humanitarian resources.



&#8220;I need help, I would accept training,&#8221; said Ole Mwato, a 46-year-old Maasai who lost 20 cows and 80 goats in the 2020-2022 droughts.



&#8220;It&#8217;s a lot of pain to lose the animals. There was no grass, no water. That&#8217;s why they died.&#8221;



Others are resistant to undertaking laborious tasks, such as digging pits to retain water, seeing it as a potential waste of time because past forecasts were unreliable or traditional cultural beliefs that say the rains are controlled by the gods.



To improve forecast accuracy, 50 low-cost, 3D-printed automatic weather stations, capable of sending highly accurate meteorological data every 15 minutes, are being installed by FEWS NET across Kenya, including three in Kilifi.



For now, Kahindi is leading by example, encouraging local farmers to adapt their methods to future weather in order to maximise yields.



&#8220;We must work together to beat famine,&#8221; she said.



(Reporting by Peter Yeung; Editing by Ayla Jean Yackley. The Thomson Reuters Foundation is the charitable arm of Thomson Reuters.)

In northern Kenya, drought may keep some herders from voting in Samburu

In Kenya, drought-weary farmers reap rewards of early warnings

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="547" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/08/2M7MCF2JIZO4NFMGJBAKSQL3JI-820x547.jpg" alt="" class="wp-image-521660" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/08/2M7MCF2JIZO4NFMGJBAKSQL3JI-820x547.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/2M7MCF2JIZO4NFMGJBAKSQL3JI-300x200.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/2M7MCF2JIZO4NFMGJBAKSQL3JI-135x90.jpg 135w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/2M7MCF2JIZO4NFMGJBAKSQL3JI-768x512.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/2M7MCF2JIZO4NFMGJBAKSQL3JI-1536x1024.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/2M7MCF2JIZO4NFMGJBAKSQL3JI-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">FILE PHOTO: Customers wait to be served in the banking hall at the Kenya Commercial Bank (KCB), Kencom branch in Nairobi, Kenya July 10, 2018. Picture taken July 10, 2018. REUTERS/Thomas Mukoya/File Photo</figcaption></figure>



NAIROBI, Aug 21 (Reuters)&nbsp;&#8211;&nbsp;Kenyan&nbsp;lender&nbsp;KCB Group&#8217;sKCB.NR&nbsp;pretax profit for the first half of this year rose 70% to 38.11 billion shillings ($297 million), up from 22.46 billion shillings in the same period in 2023, it said on Wednesday.



The company said its board of directors had recommended an interim dividend payout amounting to 4.8 billion shillings, the biggest interim dividend in its history.



The group also operates in Democratic Republic of Congo, Tanzania, Rwanda, South Sudan, Uganda and Burundi.



The group&#8217;s net interest income grew 35% year on year, supported by improved yields and increased lending, KCB said in a statement.



&#8220;We delivered a commendable first half of the year, despite strong headwinds in the operating environment, especially in Kenya,&#8221; KCB Group Chief Executive Paul Russo said.



($1 = 128.5000 Kenyan shillings)



(Reporting by Hereward Holland and Duncan Miriri; Editing by Alexander Winning)

FILE PHOTO: Customers wait to be served in the banking hall at the Kenya Commercial Bank, Kencom branch in Nairobi

Kenyan lender KCB Group reports 70% higher profit in H1

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="547" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/08/GettyImages-1556188599-820x547.jpg" alt="" class="wp-image-521585" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/08/GettyImages-1556188599-820x547.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/GettyImages-1556188599-300x200.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/GettyImages-1556188599-135x90.jpg 135w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/GettyImages-1556188599-768x512.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/GettyImages-1556188599-1536x1024.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/GettyImages-1556188599-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">The headquarters of the National Bank of Rwanda, Rwanda&#8217;s central bank, in the Nyarugenge district of Kigali, Rwanda on Thursday, July 20, 2023. The World Bank cut Rwanda&#8217;s GDP growth estimate to 5.8% from 6.2%, as it expected flooding during April and May to result in slowed economic expansion. Photographer: Bing Guan/Bloomberg via Getty Images</figcaption></figure>



KIGALI, Aug 21 (Reuters)&nbsp;&#8211;&nbsp;Rwanda&#8217;s central bank lowered its key interest rate by 50 basis points to 6.5% on Wednesday, its second cut in a row, saying inflation was projected to remain within its target band at around 5% on average.



The decision follows a 50 basis point cut to the National Bank of Rwanda&#8217;s Central Bank Rate in May.



Annual inflation peaked at 21.7% in November 2022 and has remained under 6% since the start of this year. It dipped to 4.9% in July, well within policymakers&#8217; 2%-8% target range.



&#8220;Inflation is expected to remain within our band and around our medium objective of 5% for this year 2024 and for next year 2025,&#8221; Governor John Rwangombwa told a news conference.



He added the bank&#8217;s monetary policy committee had the same inflation projections as at its May meeting.



On the economy, Rwangombwa said growth had been strong in the second quarter and was projected to remain so in the third quarter, building on the first quarter&#8217;s 9.7% growth.



Among inflation risks, Rwangombwa cited heightened geopolitical tensions affecting commodity prices and adverse weather conditions impacting food prices.



(Reporting by Philbert Girinema; Writing by Hereward Holland; Editing by Alexander Winning and Christina Fincher)

Rwandan Economy as World Bank Cuts Growth Estimate on Floods

Rwanda central bank lowers key rate for second meeting in a row

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="524" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/08/B2QSYQV4JRNZPJWD4IQ3X2TJ3I-820x524.jpg" alt="" class="wp-image-521181" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/08/B2QSYQV4JRNZPJWD4IQ3X2TJ3I-820x524.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/B2QSYQV4JRNZPJWD4IQ3X2TJ3I-300x192.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/B2QSYQV4JRNZPJWD4IQ3X2TJ3I-141x90.jpg 141w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/B2QSYQV4JRNZPJWD4IQ3X2TJ3I-768x491.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/B2QSYQV4JRNZPJWD4IQ3X2TJ3I-1536x982.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/B2QSYQV4JRNZPJWD4IQ3X2TJ3I-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">FILE PHOTO: A fountain with a statue is seen outside the Supreme Court in Nairobi, Kenya, August 20, 2021. REUTERS/Monicah Mwangi/File Photo</figcaption></figure>



NAIROBI, Aug 20 (Reuters)&nbsp;&#8211;&nbsp;Kenya&#8217;s top court on Tuesday suspended a lower court&#8217;s ruling that the 2023 finance law was unconstitutional, saying it was important to preserve stability in the budget until the merits of the government&#8217;s appeal are heard next month.



The finance bills, presented to parliament at the start of every financial year, are the main vehicle for the government to set out its revenue-raising measures including tax hikes.



The Court of Appeal&#8217;s judgment late last month that last year&#8217;s Finance Act was unconstitutional was a blow to the government of President William Ruto, who withdrew this year&#8217;s finance bill in June in the face of youth-led protests, the biggest challenge of his two-year presidency.



Ruto has been caught between the competing demands of Kenya&#8217;s hard-pressed citizens and of lenders such as the International Monetary Fund.



He has argued that tax increases are necessary to help fund development programmes and pay off a heavy public debt load.



&#8220;We find that public interest tilts in favour of granting conservatory and stay orders to &#8230; maintain stability in the budget and appropriation process pending the determination of this appeal,&#8221; Kenya&#8217;s Supreme Court said in its ruling.



The Supreme Court will hold hearings on Sept. 10 and 11 on whether the 2023 law is constitutional.



The government, which has been relying on the 2023 finance law to continue collecting taxes after Ruto withdrew this year&#8217;s bill, did not immediately comment.



The 2023 version was challenged in court following a round of violent street protests last year led by opposition parties.



Ruto&#8217;s government used the 2023 law to double the value-added tax on fuel, introduce a housing tax and raise the top personal income tax rate.



(Reporting by Hereward Holland; Editing by Alexander Winning and Conor Humphries)

Kenyan court to rule on appeal against halting of constitutional changes in Nairobi

Kenya’s top court suspends judgment nullifying 2023 finance law

<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="2048" height="1366" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-1815421853-scaled.jpg" alt="" class="wp-image-510612" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-1815421853-scaled.jpg 2048w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-1815421853-300x200.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-1815421853-820x547.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-1815421853-135x90.jpg 135w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-1815421853-768x512.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-1815421853-1536x1024.jpg 1536w" sizes="auto, (max-width: 2048px) 100vw, 2048px" /><figcaption class="wp-element-caption">President of Kenya William Ruto during the United Nations Climate Change Conference COP28 High Level Segment meeting in Dubai, United Arab Emirates on December 1, 2023. (Photo by Jakub Porzycki/NurPhoto via Getty Images)</figcaption></figure>



NAIROBI, Aug 19 (Reuters)&nbsp;&#8211;&nbsp;Kenya&#8217;s government&nbsp;will have to bring back some&nbsp;tax measures&nbsp;that&nbsp;it scrapped&nbsp;after deadly protests in June,&nbsp;the finance minister said,&nbsp;raising the risk of further&nbsp;unrest.



John Mbadi told Citizen TV in an interview broadcast on Sunday night that some of the measures would be tweaked and not all would be revived, but they were needed to pay for expenditure including wages for teachers.



Some people who were involved in the youth-led protest movement that rocked the East African nation said they were ready to go back onto the streets after the minister&#8217;s announcement.



&#8220;I was going to take a one month break from social media&#8230; but it seems that there is no rest for me,&#8221; Hanifa, who only uses one name, wrote on X.



&#8220;The struggle continues. @WilliamsRuto I dare you to bring back the finance bill,&#8221; she added.



President William Ruto&nbsp;abandoned&nbsp;the finance bill for this fiscal year on June 26, and later dismissed most of his cabinet, bowing&nbsp;to pressure from protesters who had&nbsp;stormed parliamentand&nbsp;launched demonstrations across the country.



The bill had contained new taxes and hikes to raise an extra 346 billion shillings ($2.70 billion) &#8211; plans that the protesters said would pile pressure onto a population already struggling with surging living costs.



Mbadi, who was brought into the cabinet from the opposition benches as Ruto tried to prop up his government, had ruled out further tax hikes during his first public remarks in the post on Aug. 4.



In the interview on Sunday,&nbsp;he said the government planned to reintroduce what he called an eco-levy on most goods &#8211; though plans to tax essential products such as sanitary&nbsp;pads,&nbsp;which were a focal point for protesters&#8217; anger,&nbsp;would be dropped.



&#8220;For eco-levy, we would target those areas that do not affect the common citizen,&#8221; he told the private broadcaster. The measures were needed to fund emerging government expenditures, and will be taken to parliament by Sept. 30, Mbadi said.



The government has been caught between&nbsp;the competing demands of hard-pressed citizens and of lenders such as the IMF,&nbsp;which is urging&nbsp;the government to cut deficits to obtain more financing.



After the bill was dropped, the government cut spending and widened the fiscal deficit.



Neither Mbadi, nor the finance ministry, responded to Reuters requests for comment on the interview.



The new moves would raise 150 billion shillings, Citizen TV reported. The minister rejected criticism of the levy by businesses operating in Kenya.



&#8220;This country is not a dumping place. If you are injurious to the environment, then you must pay to make good what you have caused,&#8221; he said.



The government was working to bring back 49 clauses from the original bill, some meant to streamline laws without raising or introducing new taxes, Mbadi told the broadcaster.



($1 = 128.2500 Kenyan shillings)



(Reporting by Duncan Miriri; Editing by Andrew Heavens)

COP28 In Dubai High Level Segment

Kenya to bring back some scrapped tax plans, risking more unrest

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="465" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/08/ZGLBQGNTDZO7HGPUFMWOXGH5LE-820x465.jpg" alt="" class="wp-image-520812" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/08/ZGLBQGNTDZO7HGPUFMWOXGH5LE-820x465.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/ZGLBQGNTDZO7HGPUFMWOXGH5LE-300x170.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/ZGLBQGNTDZO7HGPUFMWOXGH5LE-160x90.jpg 160w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/ZGLBQGNTDZO7HGPUFMWOXGH5LE-768x436.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/ZGLBQGNTDZO7HGPUFMWOXGH5LE-1536x871.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/ZGLBQGNTDZO7HGPUFMWOXGH5LE-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">FILE PHOTO: Shoppers walk within Merkato, one of Africa&#8217;s biggest open air market, in Addis Ababa, Ethiopia, April 25, 2024. REUTERS/Tiksa Negeri/File Photo</figcaption></figure>



NAIROBI, Aug 19 (Reuters)&nbsp;&#8211;&nbsp;Ethiopia is ramping up efforts to restructure its $1 billion international bond as part of a broader debt rework. Investors have balked at indications that the government is seeking a haircut, setting the stage for tense negotiations.



Here are some key issues in the restructuring process:



<h2 class="wp-block-heading" id="h-why-is-ethiopia-restructuring-its-debt">WHY IS ETHIOPIA RESTRUCTURING ITS DEBT?</h2>



Pressed by acute foreign currency shortages and sluggish government revenues amid a civil war in the northern region of Tigray, the government said in early 2021 it would restructure its debt under the G20 Common Framework initiative.



Chad, Zambia and Ghana have all sought to restructure&nbsp;their debts&nbsp;under the programme designed to provide swift debt relief to developing countries.



Ethiopia&#8217;s process was drawn out by the Tigray conflict which ended in late 2022 and slow progress in meeting International Monetary Fund requirements to abandon its currency peg, ditch capital controls and introduce an interest rate-based monetary policy framework.



The East African nation, the continent&#8217;s second most populous with 120 million people, floated its birr currency on July 29, helping it secure a $3.4-billion four-year IMF loan programme.



The IMF deal unlocked more financing from lenders including the World Bank and paved the way for a fresh debt restructuring push.



<h2 class="wp-block-heading" id="h-what-are-the-expected-outcomes">WHAT ARE THE EXPECTED OUTCOMES?</h2>



Ethiopia&#8217;s external debt stood at $28.9 billion&nbsp;in March, according to the&nbsp;government.&nbsp;The IMF&nbsp;identified&nbsp;a $3.5 billion financing gap during the lending programme. Ethiopia needs to plug that through the debt rework, but how that will be attained depends on the restructuring negotiations.



The government said it hoped the restructuring would achieve $4.9 billion in debt relief, citing official creditor proposals, though without a specified time frame.



To achieve comparability of treatment, a Common Framework tenet that requires commercial creditors to be treated in a similar way to official counterparts, Ethiopian officials have indicated they will seek a 20% write down on the principal of its $1 billion bond.



That has angered bondholders who said last week it does not reflect Ethiopia&#8217;s economic fundamentals, and added that the government was not following a &#8220;good faith&#8221; approach to debt restructuring.



Ethiopia has not commented on the bondholder statement.



<h2 class="wp-block-heading" id="h-how-will-that-nbsp-dispute-nbsp-be-resolved">HOW WILL THAT&nbsp;DISPUTE&nbsp;BE RESOLVED?</h2>



The dispute revolves around whether Ethiopia has a liquidity problem &#8211; a short-term issue &#8211; or whether it faces a longer-term solvency crisis.



Export and tax revenues have been under pressure and FX reserves dwindling, hampering Ethiopia&#8217;s ability to service its debt, say those who see it as a solvency issue, even though at 40.3% of GDP, the debt is fairly low.



Kevin Daly, portfolio manager at abrdn, which holds the bond, said a potential solution could be found somewhere between the government proposed haircut and extending the repayment period.



The IMF&#8217;s debt sustainability analysis shows Ethiopia has seen protracted breaches of a number of indicators the fund usually uses to identify a solvency crunch, such as the external debt-to-exports ratio.



Diverging assessments could set the stage for tense negotiations.



&#8220;Unduly conservative assumptions, coupled with unambitious fiscal efforts, may lead to protracted restructuring negotiations,&#8221; the bondholder group warned.



<h2 class="wp-block-heading" id="h-how-are-the-reforms-working-and-what-are-the-next-steps">HOW ARE THE REFORMS WORKING AND WHAT ARE THE NEXT STEPS?</h2>



The birr currency has nearly halved in value this year to trade at 103.97 per dollar &#8211; according to data from Commercial Bank of Ethiopia, the country&#8217;s biggest lender, closing in on the black market rate of 115-120.



However, progress on the key objective of unifying the two rates was initially hampered by commercial banks&#8217; hesitance to&nbsp;do so&nbsp;swiftly. Traders also hiked prices of basic commodities such as cooking oil.



Authorities have responded by closing thousands of businesses that were deemed to have raised prices unjustifiably, and the federal government has sought to boost supplies of essential commodities by ramping up imports.



The IMF says the government will have to take further action, perhaps by tightening monetary policy, to curb inflationary pressures.



The Fund has scheduled an unusually fast pace of reviews in order to closely monitor the impact of reforms.



The first review, scheduled for mid-August, is already underway and will focus on aspects such as FX reserves and external debt.



Following reviews are scheduled&nbsp;for the end of September and in December, at which point both the IMF and government expect Ethiopia to have sealed a restructuring deal.



(Reporting by Duncan Miriri; Additional reporting by Dawit Endeshaw in Addis Ababa; Editing by Karin Strohecker and Andrew Heavens)

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East Africa

Ugandan shilling steady, offshore investor FX flows offer support

Kenyan shilling flat as FX inflows meet manufacturing demand

Kenyan shilling strengthens slightly on tea exporter FX inflows

Kenyan shilling steady as diaspora FX inflows match demand

Ugandan shilling firms slightly on aid agency inflows

Kenyan shilling steady in muted trade; no reaction to S&P downgrade

Hamilton working with Rwanda and South Africa on F1 race plans

Kenyan and Ugandan shilling to firm, Zambia’s currency seen falling

Kenyan shilling trades flat, manufacturing demand matches supply

Ugandan shilling firms on low demand, charity inflows

Miner Sibanye gets 500 mln euros financing to complete Finland lithium project

In Kenya, drought-weary farmers reap rewards of early warnings

Kenyan lender KCB Group reports 70% higher profit in H1

Rwanda central bank lowers key rate for second meeting in a row

Kenya’s top court suspends judgment nullifying 2023 finance law

Kenya to bring back some scrapped tax plans, risking more unrest

Key issues on Ethiopia’s road to debt restructuring

News Tips

Advertise With Us

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