State to lease idle public land to private investors
16 May 2022
Good Morning,
The Chinese contractor who built the Nairobi Expressway won a Ksh 9 billion tender to rehabilitate the lower section of the 27km double-decker road.
Kenya to lease thousands of acres of idle public land to private investors for food and cash crop production
Last week, The Cabinet approved the proposal to seize idle land held by parastatals and lease it to private investors for food and cash crop production.
The government is positive that leasing the land would not only boost the production of food for local supply and exports but also create new jobs.
Some parastatals holding vast but idle land include the Kenya Railways, the Kenya Broadcasting Corporation, the East African Portland Cement, Kenya Prisons, and the University of Nairobi.
CAPITAL MARKETS
1. The sale of May bonds falls below the target of Ksh 60 billion
The National Treasury has raised Ksh 31.73 billion from the sale of two May bonds, falling below the target of Ksh 60 billion.
The papers were a new 10-year bond and a reopened 25-year paper.
The auction represents a 52.8% success rate.
The Central Bank of Kenya, received bids worth Ksh43.11 billion from the sale of the bonds and rejected Ksh11.3 billion2. Tadenex Limited and Tradesense Limited received licenses from the Capital Markets Authority (CMA)
Tadenex Limited has been licensed to operate as a non-dealing online foreign exchange trading broker while Tradesense Limited will operate as a money manager under the regulation of the CMA.
Currently, the number of licensed online forex trading brokers to seven, and money managers to two.
3. Safaricom Plc considers issuing a green bond
According to its Chief Executive Officer, Safaricom is considering issuing a green bond as a funding option as it nears commercial roll-out in Ethiopia.
A green bond is a type of fixed-income instrument that is specifically earmarked to raise money for climate and environmental projects and is backed by the issuing entity’s balance sheet.LAND
The average price of land in Nairobi
The HassConsult property index revealed that the price of an average house within Nairobi rose by 6.8% in the year to March compared to a drop of 1.8% in the same period last year.
Land prices in Nairobi rose by a marginal 1.07% while prices in satellite towns rose by 7.35%
Average land price per acre in Nairob:
Top 5 suburbs:
Upperhill: 500m
Westlands: 435m
Kilimani: 406m
Parklands: 392m
Riverside: 330m
Top 5 satellite towns:
Ruaka: 92m
Kiambu: 39m
Mlolongo: 31m
Tigoni: 28m
Ruiru: 27m
MOBILE MONEY
12% of mobile money users in Kenya are not registered under their own names
A study by Global System for Mobile Communications Association (GSMA) showed that 12% of the 67.94 million mobile money users are not registered under their own names and, therefore, transact through third parties.
The increased use of mobile money in Kenya has grown the risk of infiltration by criminals who avoid the highly regulated banking system that has 'know your customer’ requirements.
In Kenya, there have been numerous cases of SIM card swap scams, sim boxing, fraud, and identity theft. The perpetrators exploit gaps in the system to gain access to bank accounts through mobile banking apps.
EAST AFRICA
The Republic of Congo plans to issue Eurobonds linked to oil warrants
According to a report by Bloomberg, Congo plans to issue Eurobonds linked to oil warrants to refinance its outstanding debts to commodity traders Glencore Plc and Trafigura Group.
The deal is structured as a “debt-neutral” transaction, meaning it will be solely used to refinance about $1.4 billion of the oil traders’ loans and won’t impact the nation’s debt load.
Citigroup Inc. and Deutsche Bank AG are structuring the bond, while financial advisory firm Rothschild & Co. is working with the government.
EXPORT
Kenya’s export of duty-free goods to the United States rose by 20% in 2021
Kenya’s export of duty-free goods to the United States under the African Growth and Opportunity Act (Agoa) rose by 20% in 2021. The goods, mainly textile products, increased from KSh42.2 billion in 2020 to KSh50.6 billion in the review period.
Capital investment increased to Ksh23 billion last year from Ksh 19.1 billion in 2020 while direct employment in the sub-sector increased by 10.5% to 50,359.
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WHAT YOU MUST HAVE MISSED LAST WEEK
The High Court ordered the government to disclose the details of the SGR contract
The High Court in Mombasa ordered the government to provide agreements relating to the construction of the ksh450 billion standard gauge railway (SGR) line project. Activists and the Law Society of Kenya have previously stated that the project’s cost was inflated.
Betting statistics in Kenya
Data by Safaricom revealed that Kenyans spent Ksh169.1 billion to place bets through Safaricom’s M-Pesa in the 3 months to March this year.
Electronic Arts and FIFA are ending their partnership
The video game company and the soccer organization will not be renewing their lucrative partnership after more than twenty years. The game has brought in $20 billion in sales over the past 20 years.
As from next summer, in 2023, EA’s soccer game will be called EA Sports FC.
Members of parliament (MPs) want a 62% pay increase
Kenyan MPs from the two major coalition parties rarely agree on anything apart from the need for a salary increase. The MPs want a 62% pay increase to Ksh 1.1 million monthly plus Ksh 7.5 million tax-free car grant. They also want house allowance reinstated and perks raised to Ksh400,000.
Kenya’s Capital Markets Authority (CMA) approved TransCentury Plc to undertake a rights issue
The rights issue is on the basis of five (5) new ordinary shares for every one (1) existing share after approval by the company’s shareholders.
Transcentury plans to issue 2 billion new ordinary shares, in addition to the already issued 1.2 billion ordinary shares.