EAC currencies at all time low

NAIROBI - The Kenyan Shilling entered into uncharted territory last week nearing the hundredth mark against the dollar a move which spread jitters across the country.
The new record low marked a continued free fall of the Kenyan currency against the dollar with analysts predicting even harder times ahead.
In early trading from Tuesday, the shilling was exchanging at between Ksh97 and Ksh96.55 against the dollar.
On Thursday however, the shilling weakened dramatically to touch a record low of Ksh98.05 in early trade as investors bought dollars on fears that Europe's escalating debt crisis could lead to a global banking crisis.    

Tanzania: Mkuchika challenges social security funds to widen pensioners' base

SOCIAL security fund boards and their managements should look for ways to increase the percentage of retired people getting monthly pension payments from the current estimated four per cent.

Minister of State in the Prime Minister's Office responsible for Regional Administration and Local Governments, George Mkuchika, said in Dar es Salaam over the weekend while inaugurating Local Authorities Pensions Fund's new board of trustees, that many retired people in rural areas don't get pension payments.

"Many others, who played a big role in the development of this country, don't get any pension payments simply because they were not formally employed. You who manage these social security funds should find a way to include these people as your beneficiaries," Mr Mkuchika argued.

Tanzania: Weak Shilling Lifts Country's Tourism

Dar es Salaam — A weak Tanzania shilling has buoyed the tourism industry in the country although Tanzanians have been negatively affected by it. According to the Minister for Natural Resources and tourism Mr Ezekiel Maige, the depreciation of the Tanzania shilling against the US Dollar, which exchanges at a buying rate of Tsh 1620 per US dollar on average at bureaux de change, has benefited the tourism sector.
"Most tourism transactions are done using the US dollar, therefore it is cheap for tourists to tour Tanzania compared to the period when the shilling was strong," said Minister Maige.
He explained that for the past 12 months the currency has been weakening against the US Dollar. "Last week for example, the selling price of the shilling went down to Tshs1,659/75, a dollar, the lowest level ever in 45 years," said Maige.

Tanzania: New global economic crisis worries EAC

TANZANIA has said should the world experience a second economic downturn, the impact on East African Community (EAC) countries would be more telling as the economies of the five partner states were interconnected than never before.

The Minister for Finance, Mr Mustafa Mkulo told a sideline session of the 2011 IMF-World Bank annual meeting in Washington DC that shocks for Africa, especially the EAC members from a new economic downturn would be worse than in last crisis.

Tanzania: Credit to Private Sector Grows By 26 Percent - Central Bank

Dar es Salaam — Credit to the private sector growth continued to pick up by 25.6 per cent in the year ending June this year from 16.3 per cent recorded in the previous year, the central bank has said. "The growth reflects recovery of banks confidence in the economy following easing of the global financial crisis," states the Bank of Tanzania's monthly economic review for July.
According to the report, banks credit to all major economic activities experienced annual growth rates in the year to June 2011, compared with the rates recorded June last year, except for manufacturing, and transport and communication activities.

Global: UBS CEO Resigns Over Rogue Trading Loss

GENEVA — UBS chief executive Oswald Gruebel has resigned over a $2.3 billion loss caused by rogue trading at its investment division, which is to be restructured now to prevent similar incidents in future, the Swiss bank said Saturday.
Gruebel, who had come under heavy pressure from shareholders over the scandal, said he hoped his resignation would allow the bank to restore its reputation in the eyes of clients and investors.
"As CEO, I bear full responsibility for what occurs at UBS," he said in a memo to staff. "From my first day on the job I placed the reputation of the bank above all else. That is why I want to and must act according to my convictions."

IMF: Global Economy Entering Dangerous Phase

WASHINGTON -- Top global finance officials are pledging to work decisively and in a coordinated way to deal with a European debt crisis and other dangers confronting the global economy.
The International Monetary Fund's policy-setting committee says the economy has entered a dangerous new phase. The panel says close watching of the situation and a willingness to take bold actions quickly are crucial.
Officials say they're encouraged by the willingness of the 17 nations that share the euro currency to do what's needed to resolve Europe's debt crisis.

China, Tanzania Set to Engage in $3B Coal, Iron Ore Deal

China and Tanzania are set to work on a $3-billion coal and iron ore construction partnership that will develop the Mchuchuma coal and Liganga iron ore projects in Southern Tanzania.
The project, a collaboration between China's Sichuan Hongda Co. Ltd. and Tanzania's state-run National Development Corporation (NDC), involves the construction of the Liganga iron ore mine and the Mchuchuma integrated coal mine, a 600-megawatt (MW) thermal power station.
The two firms have created a joint venture company for this particular undertaking, the Tanzania China International Mineral Resources (TCMR). Sichuan Hongda will own 80 percent of the joint venture project, while the remaining goes to NDC.

Tanzania: DSE trading activities slow over European financial crisis

The Dar es Salaam Stock Exchange (DSE) market expects continued low level of activities as foreign investors participation continues to slow.However, the status of recovery in the financial sector in the West, mainly the European zone is likely to continue to hinder foreign investors from investing in the local market.

“We anticipate some activities in most counters due to strong demand but we do not anticipate any major changes in the general level of activity over the coming week,” says Joel Nkya, an analyst at Tanzania Securities Limited, brokers and members of DSE.

Uganda: Loans Can Be a Magic Bullet or the Poison for SMEs

FOR many a potential entrepreneur, capital is the magical bullet that does not just kick-start, but can make the difference between success and failure. Capital refers to cash or goods used to generate income either by investing in a business or a different income property. It is also the net worth of a business.
Alongside land, entrepreneurship and labour, capital is the other factor of production.
Raising equity or owner's capital for any venture is often a challenging task for Small and Medium Enterprises (SMEs).

Global: There’s Usually a Banking Crisis Somewhere!

Add together fundamental illiquidity and smallness of capital, and what have you got?

Indeed, drawing from Reinhart and Rogoff’s very long list of banking crises, we find that in the century between 1901 and 2000, a banking crisis began in one or more countries (often in several simultaneously) in 54 of the 100 years! The crises can last multiple years; the list below shows the initial years. Of course, this data does not include the great international banking crisis of 2007-09, now rekindled in Europe from 2010-?, and looks instead back to a century of “good old days.”

Tanzania: Treasury bills still draw huge interest

DESPITE the soaring inflation rate and the alarming economic turbulence hitting some Western countries, the two-year Treasury bond maturities continued to attract massive investments, leading to over subscription, the auction summary has revealed.

According to the Bank of Tanzania (BoT) treasury bonds auction held last week, the total amount tendered jumped to 57.8bn/- against 25bn/- offered at 9.6 per cent weighted average yield to maturity.

Tanzania: Central Bank Wants Govt to Subsidize Energy Prices

ACUTE food shortage caused by prolonged droughts in some neighbouring countries will drive up prices for commodities hence fuelling inflation increase. The Bank of Tanzania (BoT) Director of Director of Policy and Research Dr Joe Massawe said in an interview last weekend while commenting on the soaring inflation rate that reached 14.1per cent last August.
"Unless the food situation in the neighbouring countries improves, the country's inflation rate would continue to soar, making the economic targets unrealizable," Dr Massawe said.

DSE: Share Prices - 26th Sep 2011

Co.		Opening Price	Closing Price	High	Low
	TOL		0	200	0
	TBL		0	1,900	0
	TATEPA		0	475	0
	TCC		0	2,620	0
	SIMBA		0	2,380	0
	SWISSPORT		0	790	0
	TWIGA		0	2,080	0
	NICOL		0	245	0
	DCB		0	600	0
	NMB		0	850	0
	KA		0	1,020	0
	EABL		0	2,000	0
	JHL		0	5,860	0
	KCB		0	440	0
	CRDB		0	178	0
	NMG		0	3,100	0

DSE: Share Prices - 8th Sep 2011

Co.		Opening Price	Closing Price	High	Low
	TOL		0	200	0
	TBL		0	1,860	0
	TATEPA		0	475	0
	TCC		0	2,600	0
	SIMBA		0	2,360	0
	SWISSPORT		0	730	0
	TWIGA		0	2,060	0
	NICOL		0	245	0
	DCB		0	600	0
	NMB		0	850	0
	KA		0	1,020	0
	EABL		0	2,000	0
	JHL		0	5,860	0
	KCB		0	440	0
	CRDB		0	180	0
	NMG		0	3,100	0

DSE: Share Prices - 7th Sep 2011

Co.		Opening Price	Closing Price	High	Low
	TOL		0	200	0
	TBL		0	1,820	0
	TATEPA		0	475	0
	TCC		0	2,600	0
	SIMBA		0	2,360	0
	SWISSPORT		0	710	0
	TWIGA		0	2,060	0
	NICOL		0	245	0
	DCB		0	600	0
	NMB		0	850	0
	KA		0	1,020	0
	EABL		0	2,000	0
	JHL		0	5,860	0
	KCB		0	440	0
	CRDB		0	180	0
	NMG		0	3,100	0

Africa: Microfinance - What Role in Africa's Development?

Since the idea of lending small sums of money to poor people was pioneered by Grameen Bank in Bangladesh, the approach has been taken up by many non-governmental organizations, donor agencies and the United Nations as an essential part of their poverty-reduction efforts.

Microfinance has provided countless people with access to financial services.
But over-indebtedness of microfinance clients in Andhra Pradesh has recently led to numerous suicides and a political crisis in India's fifth-largest state. And controversy has swirled in Bangladesh around Mohamed Yunus, Nobel laureate and founder of the Grameen Bank. Together, these events have generated a backlash for microfinance.

Should development practitioners now abandon efforts to bring financial services to the poor? Or should they seize on the interest generated by the recent troubles to reassess the strengths, weaknesses and potential of microfinance? Such a reassessment may be pertinent in Africa, where poor people's access to formal financial institutions remains limited.

Uganda: Bank of Uganda Increases Lending Rate to 16 Percent

The Bank of Uganda has increased its lending rate to 16 per cent from 14 per cent in August, signaling a further increase in interest rates by local commercial banks by 2 percentage points. "With this further increase in the Central Bank Rate (CBR), we expect lending rates to be adjusted upwards. I don't want to dictate to commercial banks but we expect a response," Dr Louis Kasekende, the deputy governor Bank of Uganda said at a press conference in Kampala on Tuesday.

Tanzania: T-bills continue to attract public interest

TREASURY bills have continued to attract massive investments despite low interest rates leading to an overly subscription, a signal that investors are awash with resources.

According to the Bank of Tanzania (BoT) summary of the auction held on Monday this week, total amount tendered was 144.2bn/- against an offer of 100bn/- at an annual average interest rate of 4.7 per cent.

Tanzania: TIC identifies ventures that are ready for PPP

The Tanzania Investment Centre has identified a number of projects it says are up for public private partnership or joint ventures.

They include Southern Agricultural Corridor of Tanzania (SAGCOT), National Ranch Company (NARCO), Suma-JKT, Tanzania Prisons farms and Tanzania Private Sector Foundation projects.

The TIC Acting Director of Investment Promotion, John Mathew Mnali told The Guardian on Saturday that the centre invites potential investors from different parts of the world to inject capital in these areas.

“Local and foreign investors keen to invest in these areas, the government through the Tanzania Investment Centre (TIC) will provide assistance to see that these projects are promoted,” he said.