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Archive for the tag “World Bank”

Central Bank of Kenya: Press Release – Circulation of the New Generation Banknotes and Withdrawal of the Older 1,000 Shillings Banknotes (06.06.2019)

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Hatua 254 Open letter to the World Bank: “Re: Citizens of Kenya Protest Letter on KSH 75 Billion Loan to the Government of Kenya” (03.06.2019)

 

Tanzania: Blocked IMF Report, because of negative projections!

President Joseph Pombe Magufuli isn’t the sort of guy, that handles critics or opposition well. He is the sort of guy that needs all praise and benefits of a doubt. Therefore, the latest move is in a long line of questionable behaviour from his party, his apparatus and his administration to stifle voices of another opinion.

The Tanzanian government under Magufuli is a paranoid and wavy state. Where everything hangs by a thread, if your in the good graces of the President or not. If your not or if you questions him. He will take your license, suspend your newspaper or even detain you for a various reasons. That is the state of affairs. So, that the President and his people have blocked an unfavourable report from the International Monetary Fund isn’t surprising, it is more of the same.

This is from the same man, that has arrested MPs for speaking ill of him. This is from the same man, that didn’t like articles written the The Citizen to later suspend that too. Therefore, when someone dares to question his ways and orders, he will strike with fury. That is the man, the governs and leads the Republic.

Here is some pieces of information, that might be the reason why the Article IV Report of the IMF was blocked from publishing. With the Press Release of the block from IMF, before a Stratfor explanation and projections of the World Bank.

IMF Press Release:

On March 18, 2019, the Executive Board of the International Monetary Fund concluded the consideration of the 2019 Article IV Consultation with the United Republic of Tanzania” (…) “The authorities have not consented to publication of the staff report or the related press release” (IMF – ‘Statement on the 2019 Article IV Consultation with the United Republic of Tanzania Staff Report’ 17.04.2019).

Stratfor explanation:

What Happened: An apparently leaked report by the International Monetary Fund contains criticism of the Tanzanian government’s interventionist economic policies and noted that they are hurting the country’s investment climate, Bloomberg reported April 18. The Tanzanian government subsequently decided to block the report’s release. Why It Matters: The report will likely serve as an alarming sign for international investors who already have been concerned that the Tanzanian government is targeting foreign multinational companies” (Stratfor – ‘Tanzania: IMF Report Criticizes Government Measures’ 19.04.2019).

World Bank Context:

Economic performance in 2018 was mixed, while inflation remains low and stable. The National Bureau of Statistics did not release any quarterly gross domestic product (GDP) data for 2018, pending completion of a rebasing exercise. However, available data suggest signs of softening of the growth momentum” (World Bank in Tanzania – Context, 01.04.2019).

We can clearly see why the President didn’t want this to get released, also that his administration would further hit their goals, when concerning their economic forecast. This is damaging the image and also the confidence in the financial system. The IMF would have told a story that the administration didn’t want to hear or listen too.

That is why it hasn’t been released, because the President who wants all positive and praise. Cannot manage an independent entity from the outside coming with a message or projection, which isn’t fitting the narrative of the CCM. At this point, that is the message I get out of it.

Magufuli and the Tanzanian Administration could have turned the projections and the forecast. They have the ability to create stability and trust in the financial system. However, they are instead stonewalling and continuing on this path. They are not creating confidence of the acts of the government from the outside. It is backfiring instead, but this is from the administration that has to verify and give a stamp of approval to release statistics.

Therefore, we know how far this administration goes. Now, they are even stopping Article IV Report from being released. That is a sign of weakness in the economy. Peace.

Turkana Drought: State Officials knew about the drought, but didn’t act!

Today is a day of warning, where the government, the local government and its authorities haven’t been prepared or cared for it. In its ignorance, the citizens of Turkana and its draught is happening, because their representatives and the state haven’t prepared for the shortfall of food nor water in the region. Even if there was waning signs months ago.

This is not just made up that Governor Josphat Nanok of Turkana County, CEO of NDMA James Odur, CS of Ministry of Devolution and ASALs Eugene Wamwalwa and so on. Can put the blame on everything else, but not on the intial inaction of their own government post. Even if that is true, because the FEWS warned about this in August/December 2018, because of lack of rain. Still, the government kept pumping like there was no tomorrow. Did nothing about it or didn’t handle it all. Since, who would make a fuzz anyway, right?

FEWS Network Warning Des. 2018:

“Performance of the October to December short rains was highly mixed across Kenya, leading to below-average crop performance and inadequate replenishment of rangeland resources in rainfall-deficit areas. In many pastoral and southeastern marginal agricultural areas, rainfall was below 85 percent of normal, while rainfall in the rest of the country was above average. Stressed (IPC Phase 2) outcomes are likely to persist in most pastoral and marginal agricultural areas through May, and an increase in the number of poor households in Crisis (IPC Phase 3) is expected in localized areas of Turkana, Wajir, and Garissa by February” (FEWS Net, 31.12.2018).

Kenyan Government response:

“The National Government has provided total of Kshs. 1,351,196,000 for response during the period of February, March and April 2019 as follows: Food and safety net Kshs. 601,196,000. Support to household irrigation water storage program (excavation of small water pans) Kshs. 600,000,000. Support to water trucking, maintenance and rehabilitation of boreholes Kshs. 150,000,000. Water trucking by NDMA in Mandera, Wajir, Turkana, Garissa, Marsabit and Tana River and maintenance of water points in selected areas. Hunger Safety Net Programme cash transfers by NDMA in Turkana, Wajir, Mandera and Marsabit” (…) “Nevertheless, the below-average short rains have slightly increased the food insecure population from 655,800 in August 2018 to current number of 1,111,500, with the top 12 counties having a total of 865,300 food insecure people” (Government of Kenya – ‘BRIEF ON CURRENT DROUGHT AND FOOD SECURITY SITUATION IN ASAL COUNTIES, MARCH 2019’ 15.03.2019).

What is sad is the amount of people starving in a midst of draught, in region, where the state could have acted more swiftly and with more manpower. Because, they knew perfectly well that this was happening. This is in a region where Tullow Oil Company plans to drill oil with over 300 oil wells. Meaning, there is money and resources, which should lead to progress and development. So, that the region and county isn’t as impoverish as it is. However, there seems to be little or none of the seeds of the oil to go to needed projects or facilities to help out the locals.

Instead, the international oil companies, which reached an agreement last year in 2018. Have had the ability to drill for oil and the leaders have been pocketing money. While the state and the local county officials haven’t secure the public. That is what is the initial bargain in all of this. The public officials have been busy eating and now the public aren’t even getting bread-crumbs of the spoils. That’s what is even more sad about this situation. Knowing the region had hopes for the oil adventure and now seeing a drought, which brings even more despair.

Lochikar Basin haven’t brought anything to the local community, other than foreign investors pumping out their valuable resources, while the deal between Tullow and Government remains secret. As well, as the scarcity of water and other needed components of life, continue to run rampant in a region, which should have gotten some of the spoils of the wealth that is created there. Instead, the government cartels and public officials, who does not want to associate with the demise of the people in the drought, eat that up.

This could have been avoided, the state could have acted and the Turkana with their Oil should have had the resources to cope with it and be able to buy the needed imports of food and water. Alas, someone else is eating that, as long as the oil trucks are driving to Mombasa and the public see less or little of trade of it all.

While the sun is burning, little or no rain, while they await for a handout, when the government could have footed the bill, by the earnings of the oil alone. Peace.

Kenya Pipeline Company: Press Statement – KPC Management is Fully Committed to the Fight against Corruption (20.02.2019)

Kenya Pipeline Company Limited – Press Release (04.12.2018)

Machakos: Leader of Majority Mark Muendo Press Statement on the Refusal to Release Funds to the Assembly by Governor Alfred Mutua (26.11.2018)

Somalia: “Re: Bid Rounds, new contracts (PSA) and legacy petroleum contracts – the way forward for the national interest of Somalia” (18.11.2018)

Opinion: China is starting to squeeze the Kenyan Economy!

If you were ever thinking that Beijing would loan and build without consequence. Those days should long be gone. The Chinese are planning to earn money on their investments, they don’t care about the Republic’s they are investing in, as long as they are profits on their investments. They want earn on these loans and since the rate of loans are so high. They are now starting to pick collateral for their infrastructure loans, especially the draining of loans to the Standard Gauge Railway (SGR).

While acknowledging China’s leading role in the Kenyan economy as a trading partner, the President called for increased Chinese investments in the country. “China now ranks as the number one trading partner with Kenya accounting for 17.2% of Kenya’s total trade with the World,” he said. “Kenya is open and safe for business. Kenya has one of the most conducive business environments in Africa,” the President added” (President.Go.Ke – ‘President Kenyatta Asks China To Give Preferential Treatment For African Goods’ 02.11.2018).

While Kenyatta are acting as it all positive, the reality is that the state are having giant issues with their “investments” and loans there. But Kenyatta wants to make it sound positive, when it really isn’t, just the rate of the loans have grown and the consequences of the relationship with China is now starting to cost. It is the Kenyans that has to pay these loans down and with every way possible. As the Chinese has leverage over the Kenyan government. Take a look at these quotes from media recently!

Loan Rate in Kenya:

Kenya’s current public debt stands at approximately 4.884 trillion Kenyan shillings (USD$49 billion) or 56.4% of the country’s gross domestic product.. This is up from 42.8% in 2008. In other words, the country owes more than half the value of its economic output (GDP)” (…) “China is Kenya’s largest creditor, holding about 72% of the country’s bilateral debt as of March 2017. Studies show that Kenya’s Chinese debt poses a threat because the loan agreements are not transparent, projects are not well prioritised, accounting procedures are weak and it’s not clear what projects are costing” (Odongo Kodongo – ‘Kenya’s public debt is rising to dangerous levels’ 05.08.2018).

Selling State Owned Enterprises:

The Privatisation Commission has approved sale of 26 state-owned corporations to raise funds to support the budget. The commission, under the Privatisation Act, 2005, was mandated to sell 26 poorly performing state corporations to cut down government spending. Those approved for sale are National Bank of Kenya, Consolidated Bank of Kenya, Kenya Meat Commission, Development Bank of Kenya, East African Portland Cement, Kengen, Kenya Pipeline Corporation, Kenya Ports Authority, and five sugar millers — Chemilil, Sony, Nzoia, Miwani and Muhoroni. Others are Agrochemical and Food Corporation, New Kenya Co-operative Creameries, Numerical Machining Complex and Isolated Power stations, hotels (Kabarnet Hotel, Mt Elgon Lodge Ltd, Golf Hotel Ltd, Sunset Hotel Ltd and Kenya Safari Lodges and Hotels Ltd). Also targetted are Kenya Tourism Development Corporation-associated companies, which include International Hotels Kenya Ltd, Kenya Hotels Properties Ltd, Mountain Lodge Ltd and Ark Ltd” (Cynthia Ilako – ‘State to sell 26 companies to finance current budget’ 03.11.2018, The Star Kenya).

China Selling Infrastructure Loans to Investors:

The plan will see Hong Kong mortgage insurer Hong Kong Mortgage Corporation (HKMC) buy a diverse basket of infrastructure loans next year and explore the idea of “securitising” or repackaging them into securities for sale to investors, allowing it extra liquidity that it can loan out to finance more infrastructure projects. “This initiative we believe will help ‘recycle’ commercial banks’ capital to be redeployed into other greenfield infrastructure projects, besides enabling wider capital markets participation in infrastructure development under the Road and Belt initiative,” said HKMC Greater China chief executive Helen Wong” (Allan Olingo – ‘China plans to sell off its African infrastructure debt to investors’ 05.11.2018).

We are seeing the growth of loans, that is up 42,8% and the debt level of the 56,4% of the GDP. Because of that, the state are now selling of their State Owned Enterprises. Most likely to Chinese holding companies and investors, who are expecting to gets points on their dollars. As well, as securing their future on the investment. They are selling the central institutions and businesses, which was state controlled, but they will now become para-stalls of the Chinese.

But selling the institutions are not enough for the Chinese. They are planning to take it further. Planning to rehash the loans as sub-prime loans for investors, meaning they are taking the risk instead of the Export-Import Bank of China, where the loans are usually collected and distributed from. Therefore, the loans are another target of more profits as they want to earn on them as well into the Capital Market. Just like the US Banks did with House Loans and mortgages in the past.

While all that is happening and with the knowledge of this, the President is still keeping it cool. Kenyatta is still not saying the brazen truth, that they are a debt-slave to China. Are in such big trouble, that the investment of the SGR are killing the economy and they have to trade-off their assets to keep up with their payments. That is what is happening and this is not really developing, but hurting the economy even more. As this institutions and businesses has been controlling their markets. Now, they will have masters from outside, which are not there to secure the market, but make a direct profit. Therefore, the citizens are not only paying their loans for the railroads, but for destroying their economy. Peace.

Somalia: Final Communique of the OIC Contact Group Meeting on Somalia, Mogadishu (27.10.2018)

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