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Tuesday 31st of October 2017 |
Morning, Africa |
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The Latest Daily PodCast can be found here on the Front Page of the site http://www.rich.co.ke
Macro Thoughts |
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07-AUG-2017 :: Any financial expert will tell you that President Trump's financial affairs are a "smoking gun." Law & Politics |
Any financial expert will tell you that President Trump’s financial affairs are a ‘’smoking gun.’’ Deutsche Bank loans were surely ‘’mirror’’ transactions, where Deutsche Bank was a commission agent interposed between Trump and the real lender. All those sales where Trump proclaimed himself a ‘’genius’’ because they were so off-market, we would all be incredulous, were essentially just that ‘’incredible’’. ere is a prima facie case here and its in plain sight. President Trump knows it and that’s why he has been demanding Al Pacino [a la Martin Scorsese’s godfather] style demands of loyalty from the likes of the now dispensed with FBI director James Comey.
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05-DEC-2016 We have a Deviate, Tomahawk Law & Politics |
However, my starting point is the election of President Donald Trump because hindsight will surely show that Russia ran a seriously sophisticated programme of interference, mostly digital. Don DeLillo, who is a prophetic 21st writer, writes as follows in one of his short stories: The specialist is monitoring data on his mission console when a voice breaks in, “a voice that carried with it a strange and unspecifiable poignancy”. He checks in with his flight-dynamics and conceptual- paradigm officers at Colorado Command: “We have a deviate, Tomahawk.” “We copy. There’s a voice.” “We have gross oscillation here.” “ There’s some interference. I have gone redundant but I’m not sure it’s helping.” “We are clearing an outframe to locate source.” “ Thank you, Colorado.” “It is probably just selective noise. You are negative red on the step-function quad.” “It was a voice,” I told them. “We have just received an affirm on selective noise... We will correct, Tomahawk. In the meantime, advise you to stay redundant.” The voice, in contrast to Colorado’s metallic pidgin, is a melange of repartee, laughter, and song, with a “quality of purest, sweetest sadness”. “Somehow we are picking up signals from radio programmes of 40, 50, 60 years ago.” I have no doubt that Putin ran a seriously 21st predominantly digital programme of interference which amplified the Trump candidacy. POTUS Trump was an ideal candidate for this kind of support.
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Stay Out of South China Sea Talks, Beijing Tells U.S. Law & Politics |
The United States shouldn't obstruct efforts by China and its neighbors to agree on a code of conduct in the disputed South China Sea, China's ambassador said Monday as President Donald Trump prepared for his first official visit to Asia.
Ambassador Cui Tiankai said the U.S. has no territorial claim in those waters and should let countries in the region manage their disputes in a "friendly and effective way."
Beijing's island-building in the South China Sea has drawn criticism from Washington which says it has a national interest in freedom of navigation in sea lanes critical for world trade. Secretary of State Rex Tillerson this month said China's "provocative actions" challenge international law and norms.
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America's Wars Are Spreading Chaos in Africa By Pankaj Mishra @bv Law & Politics |
The Indonesian military killed as many as 1 million suspected communists in the mid-1960s, paving the path for a dictator, Suharto, who ruled the country for more than three decades. Newly declassified documents from the U.S. embassy in Jakarta reveal an extraordinary degree of American complicity in what remains one of the cold war’s biggest crimes. The U.S. not only ignored information that could have prevented the atrocity; it facilitated the killings by providing the Indonesian military with money, equipment and lists of communist officials.
It's astonishing, for instance, that it took the death of four American soldiers in an ambush in Niger early last month to alert many, including Sen. Lindsey Graham, a leading foreign policy hawk, to the presence of nearly 1,000 U.S. troops in the country. Another interventionist, Sen. John McCain, is now pressing the Pentagon for more details about a mission that costs American lives and about which even he knew nothing.
The Niger mission is in turn only a small part of an ambitious strategy of fighting terrorism in Africa since the early 2000s. Africans, of course, pay the biggest price for such policies, in both human lives and human rights. Just two weeks ago, the security forces of Ugandan President Yoweri Museveni, one of America’s closest allies in Africa, fired into an opposition rally, nearly killing opposition leader Kizza Besigye.
In "Another Fine Mess: America, Uganda and the War on Terror," a stunning new book of reportage and analysis, Helen Epstein reveals Museveni, like Suharto before him, as one of the biggest beneficiaries of an ill-conceived and sparsely monitored war on America's enemies abroad. Epstein, a professor of human rights and global public health at Bard College, lays out in appalling detail how Museveni, who seized power in 1986, has helped worsen every major conflict in eastern and central Africa since then.
This neighbor from hell shares blame for not only the wars in the Congo that have destroyed millions of lives, or the rise of the warlord Joseph Kony and the terrorist outfit al-Shabab, which killed more than 300 people in the Somalian capital of Mogadishu last month. He also bears considerable responsibility for the rebel invasion of Rwanda in 1990 that triggered the genocide there in 1994. And this extraordinary catalogue of crimes should include as well Museveni’s role in the ongoing civil war in Southern Sudan.
As with cold war allies such as Suharto and South Vietnam's venal Ngo Dinh Diem, Museveni has managed to keep successive U.S. administrations on his side by presenting himself a stout defender of American interests and an indispensable buffer against the ideological foe of the day -- now Islamist extremism, rather than Communism.
But, as Epstein reveals in disturbing detail, this new war has spread violence, chaos and repressive rule across Africa; it has spawned terrorists as well as Diems and Suhartos. To take only one example: Al-Shabab flourished in Somalia, eventually enlisting in al-Qaeda’s network, after the country was ravaged, and its moderate government undermined, by a U.S.-assisted Ethiopian invasion in 2006. Today, the U.S. ignores Museveni’s dictatorial ways partly because it uses Ugandan troops to fight al-Shabab.
Such moral expediency in pursuit of hazily defined and short-term goals is a recipe for brutal anarchy. As Hannah Arendt pointed out, "the danger of violence, even if it moves consciously within a non-extremist framework of short-term goals, will always be that the means overwhelm the end."
Means have indeed overwhelmed the end in Africa, empowering figures like Museveni. Our continuing political and public indifference to their misdeeds suggests that black lives matter even less in Africa than they do in the U.S.
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Amazon Might Help Explain the Inflation Mystery @bv Law & Politics |
Increasingly, economists are talking about the "Amazon effect." The idea is that as online retailers gain market share, they're putting pressure on brick-and-mortar shops to keep prices down. This, in turn, might be preventing inflation from getting back up to normal.
The latest U.S. inflation data offer some support for this idea. As of September, the price index for commodities excluding food and energy -- a category including apparel, electronic goods and lots of other things that online retailers sell -- was down a full percent from a year earlier. The decline shaved about a quarter percentage point off the broader "core" inflation rate, which clocked in at just 1.7 percent.
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Truffle Prices Double to $3,200 a Pound Commodities |
“Prices have doubled,” says Vittorio Giordano, vice president of Urbani Truffles, a major importer.
Each fall, truffle aficionados around the globe pay dearly to have the lumpen tubers shaved atop risotto, scattered on pasta, and draped onto sushi. But white truffles are finicky. Resistant to farming and highly perishable, they grow wild in forests, are hand-hunted by men with trained dogs or pigs, and are available fresh only from September into December. In 2016, there was an abundance of truffles, and prices plunged, but a hot summer followed by a dry fall this year have made for a dramatically smaller harvest this season.
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SUB-SAHARAN AFRICA Regional Economic Outlook: Fiscal Adjustment and Economic Diversification IMF Africa |
The broad-based slowdown in sub-Saharan Africa is easing, but the underlying situation remains di cult. Growth is expected to reach 2.6 percent in 2017, but the pickup re ects mainly one-o factors, notably a recovery in oil production in Nigeria and the easing of drought conditions in eastern and southern Africa, and a somewhat improved external environment. Even with this uptick, growth will barely surpass the rate of population growth. While a third of the countries in the region continue to grow at 5 percent or more, in 12 countries, comprising over 40 percent of the region’s population, income per capita is expected to decline. Growth in the region is expected to pick up further in 2018 and reach 3.4 percent, but ongoing policy uncertainty in Nigeria and South Africa hinders a stronger rebound, and growth is not expected to increase further in 2019. Many of the faster growing economies continue to be driven by public spending, with debt levels and debt service costs rising.
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Up Close With the Tribes of Ethiopia's Imperiled Omo Valley Africa |
“Your George W. Bush came here two years ago and not a person recognized him.”
“No one?”
“No one knew who he was.”
“Would they have known Nelson Mandela?”
“No. No one here would have seen TV. No one here thinks beyond Omo.”
I was speaking with Lale Biwa, a member of the Karo people, in Ethiopia’s Omo Valley. We were surrounded by low, circular huts made from sticks, with pitched grass roofs, in his home village of Dus, on the banks of the Omo River. A woman, heavily adorned in beads and bracelets, ground sorghum on a large stone in the nearby shade. Men, some carrying AK-47s, sat in clusters. Small naked children scampered past. Goats and cattle roamed freely on the dusty flood plain. There was no electricity, no running water, no cars. Mr. Biwam, who guesses his age to be “about 40,” looked around. “It is a good place,” he said. “The people are true.”
I had come to the Omo Valley with the innovative tourism entrepreneur Will Jones to get a view into the lives of some of Africa’s most traditional tribes. “I’m particularly interested in the Omo,” Mr. Jones told me. “It’s an at-risk ecosystem, with at-risk communities. But it is still a very wild place.” Mr. Jones was born in Nigeria of English parents, raised in East Africa and educated in England. “When it came time to put on a suit and go into town,” he said, “I came back to Africa.”
Kenya
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30-OCT-2017 :: Finding the Path Back to Political Equilibrium. @TheStarKenya Africa |
President Kenyatta has won more than 97 percent of votes counted so far according to the media. Turnout has been estimated to be around 35 percent. Deputy president William Ruto sought to wield the Political Guillotine and tweeted “Evidently it doesn’t matter how powerful/popular one or their party imagines to be, the repeat elections confirm the PEOPLE ARE SUPREME” I, for one, believe that the President won the first iteration of the election and that the Supreme Court whilst striking a blow for transparency and constitutionality failed entirely to weigh the consequences of their decision and to provide a Road-Map. However, what is clear is that we have now been overtaken by events and that the current political situation is one of disequilibrium.
Finding the Path back to Political Equilibrium [a state in which opposing forces or influences are balanced. "the maintenance of social equilibrium" synonyms:balance, symmetry, equipoise, parity, equality; stability "the equilibrium of the economy" antonyms: imbalance "I stumbled over a rock and recovered my equilibrium"] is now the central question and in fact a sine qua non for the Economy, which has slowed dramatically and where we need to absolutely avoid ''cliff-edge'' effects.
The Kenya Private Sector Alliance (KEPSA) said that the four-month electioneering period had cost the country $7 billion in losses. Investors at the Nairobi Securities Exchange (NSE) have lost $2.27 billion over the past four weeks. We are growing at the slowest pace in 6 years. Anecdotal evidence is speaking to an average of 25%-30% year on year Turnover slump across Kenya Inc. Economic Indicators are blinking amber.
I came across this comment from Eric Chitayi, a security guard in Kisumu in a Maggie Fick Reuters report
“People from this region are feeling isolated from the rest of the country, We are feeling disconnected.”
In his marvellous book The Tipping Point, Malcolm Gladwell talks about three different archetypes of people: mavens, connectors, and salespeople. The Connectors according to Malcolm Gladwell make change happen through people. They galvanize people.They’re natural hubs. That’s just the way they’re oriented to the world.
President Kenyatta is a mercurial and popular Politician. I recall a quote from someone speaking about President Bill Clinton who described meeting him thus;
''President Clinton locked onto you and made you feel like you were the only person in the room.''
President Kenyatta has a similar political style and charisma. He will be the President of Kenya a nation of more than 40m Citizens. The Political reality and in fact his legacy is now going to be calibrated on how he reconnects People like Eric Chitayi.
Everyone is a Shareholder in this Kenya Inc Enterprise or as Marshall McLuhan once said
''There are no passengers on spaceship earth [read Kenya] We are all crew''
This is a Political imperative, the reconnection of 40m Kenyans to Spaceship Kenya, without which we are going to continue sputtering.
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Shoprite Prepares Kenya Entry to Fill Gaps Left by Nakumatt Africa |
Shoprite Holdings Ltd. is in talks to open its first stores in Kenya by filling retail space left empty by the struggling Nakumatt Holdings Ltd. chain.
“We are currently in talks with some of the property owners but nothing has been signed,” Shoprite director Gerhard Fritz said in an emailed response to questions. Africa’s biggest food retailer is awaiting the outcome of merger talks between Nakumatt and local rival Tusker Mattresses Ltd. before deciding whether to proceed, he said.
Taking over vacated outlets would be the preferred way for the Cape Town-based company to enter East Africa’s largest economy as the retail market there is “too well established” to build new stores, said Fritz, who runs Shoprite’s African operations outside its home market.
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Equity posts 3pc drop in net profit Africa |
Equity Bank is looking to transactions income and regional subsidiaries to grow its earnings as the cap on cost of loans and a charged political environment cut its interest income and shaved its profit for the nine months to September.
The largest bank by customer base Monday reported a three per cent drop to Sh14.6 billion in third quarter after tax profit as its interest income fell 11 per cent to Sh35.4 billion.
Transactions income, which increased 28 per cent to Sh21.3 billion, cushioned the lender’s bottom line.
The non-funded income included earnings from foreign exchange trading, mobile banking and diaspora remittances.
“The engines of the private sector are closing off,” said Equity Group CEO James Mwangi said about the slowing credit growth in Kenya. “The wind has been taken out of the sail by these temporary headwinds.”
Equity’s investment in government securities jumped 37 per cent from Sh93.1 billion to Sh127.7 billion.
“This is not lazy banking because the return on government securities is higher,” he said.
“We are not able to lend to the micro borrowers whose default rate is as high as 80 per cent.”
All the regional subsidiaries, apart from Democratic Republic of Congo (DRC), posted double digit growth in profitability.
Mr Mwangi attributed the challenging political environment in DRC as the reason behind the dip.
“Equity Bank managed to shield itself from the headwinds and that was something impressive. They adopted very fast to the environment,” said Ewart Salins, executive director at Kestrel Capital.
Parliament in September last year capped the interest rate payable on loans to a maximum of four percentage points above the Central Bank Rate.
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Equity Bank share price data here Africa |
Par Value: 0.50/- Closing Price: 36.50 Total Shares Issued: 3702777020.00 Market Capitalization: 135,151,361,230 EPS: 4.38 PE: 8.333
Equity Bank released their 3Q17 results this afternoon before market close. EPS declined by 2.8% y/y to KES 3.87 – marginally above our expectation of KES 3.71. PBT declined by 3.6% y/y to KES 20.7bn in 3Q17 – this was slightly above our expectation of KES 19.9bn. (+4.0%).
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N.S.E Today |
The Kenya Shilling was last trading at 103.71 and when you factor in the Interest rate is better than scratch for the year. The best performing FIAT currency worldwide is the Mozambique Metical which is +16.73% in 2017. Africa takes up 7 out of then 10 positions in the worse currency returns for 2017, led by the Congolese Franc -26.00%, Sierra Leone Leone -25.35%, Ethiopian Birr -17.98%, Nigeria Naira -12.54%, Gambian Dalasi -9.55%, Tunisia Dinar -7.88% and Ghana Cedi -6.54% Year to date. The overall year on year inflation stood at 5.72 per cent in October 2017 which represented a sharp drop. The Stock Market was a sea of Blue and buoyant as the Equity market discounted the Political Noise and interference. The Nairobi All Share rallied +1.174% to close at 161.99. The Nairobi NSE 20 Index rallied +54.78 points to close at 3729.62 Equity Turnover affirmed the up move and traded 760.402m.
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N.S.E Equities - Commercial & Services |
Safaricom Ltd., said Chief Executive Officer Bob Collymore will take medical leave from the wireless carrier “for a number of months” to be treated for an unspecified illness. Collymore, 59, will be replaced on an interim basis by Joseph Ogutu, director of strategy and innovation, the Nairobi-based wireless carrier said in a statement on Monday. Chief Financial Officer Sateesh Kamath, Collymore’s alternate on the board of directors, will also take “a primary role,” it said. The CEO had been due to step down in 2019, after his contract was extended for two years in May. Mr. Collymore has overseen a 420 percent rise in Safaricom’s share price [without accounting for dividend payments over tis period] since he took the helm seven years ago and puts him in the Rock Star Category of global shareholder value creators. Safaricom firmed +0.99% and was trading at session highs of 26.25 +3.96% at the closing Bell. Safaricom traded 3.344m shares and Investors are anticipating the H1 Earnings Release this Friday.
Uchumi Kenya notified the CMA on the late publication of financial results for the year ended 30th June 2017. The Board expects to publish by November 15th. Uchumi ticked +1.41% higher to close at 3.60.
Kenya Airways rallied +6.54% to close at 5.70 making that a +12.871% gain over 2 trading sessions. Kenya Airways traded 614,500 shares.
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N.S.E Equities - Finance & Investment |
Equity Bank reported Q3 2017 Earnings yesterday where Q3 EPS declined by 2.8% y/y to KES 3.87 and Q3 PBT declined by 3.6% y/y to KES 20.7bn. “The engines of the private sector are closing off,” said Equity Group CEO James Mwangi said about the slowing credit growth in Kenya. “The wind has been taken out of the sail by these temporary headwinds.” Equity’s investment in government securities jumped 37 per cent from Sh93.1 billion to Sh127.7 billion. “This is not lazy banking because the return on government securities is higher,” he said. “We are not able to lend to the micro borrowers whose default rate is as high as 80 per cent.” Subsidiaries in Uganda, Rwanda, South Sudan, Tanzania and DR Congo collectively increased their profit by 53% YoY. Dr. Mwangi got ahead of the curve and these results were quite vibrant in the circumstances of the Rate Cap and a synchronised slow-down in the Economy. and explains why Equity Bank ramped +4.109% higher to close at 38.00 and was trading session highs of 38.50 +5.41% at the finish. Sellers were in short Supply and only 227,600 shares were traded.
KCB traded 2nd at the Bourse and ticked -0.65% easier to close at 38.00 and traded 5.747m shares worth 219.7m.
Barclays Bank predictably rallied +5.82% to close at 10.00. Buyers outpaced Sellers by a Factor of 10 to 1 which is constructive for the share price.
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N.S.E Equities - Industrial & Allied |
EABL was the most actively traded share at the Exchange today and shaved off -0.48% to close at 244.00 on good volume action of 1.234m shares worth 302.354m which represented 39.715% of the total volume traded at the Exchange today.
Mumias Sugar postponed the announcement and submission of its financial results for the year ended 30th June 2017 until 30th November. Mumias Sugar firmed +4.55% to close at 1.15.
BAT [which is a preeminent dividend paying stock and with inflation lurching lower - the dividend stream becomes more valuable and keenly sought] rallied +5.96% to close at 800.00 where 56,400 shares were traded.
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