Small and individual investors of cross-listed companies in East Africa have been handed a lifeline after the Council of Ministers agreed on rules that give them powers to prevent hostile takeovers engineered by majority shareholders. The EAC member states have up to October this year to pass and ratify laws to cement the regulation that will see shareholders with less than 50 per cent of the total shares of companies challenge decisions on mergers and acquisitions taken by majority shareholders. The directive, which has been gazetted, will clip the wings of domineering majority shareholders and encourage cross-border investments in the region. “The objective of this directive is to establish minimum guidelines for the conduct of takeover bids and mergers and ensure an adequate level of protection for holders of securities throughout the Community,” said Dr Haji Ali Kirunda Kivejinja, chairperson of the Council of ministers and Uganda’s Minister for East African Affairs. Equal treatment According to the directive, all shareholders holding the same class of shares in a company will be treated equally and the boards of these companies will be required to give all shareholders an equal chance to decide on the merits of a takeover. “The board of an offeree company (company selling the shares) shall act in the interests of the company as a whole and shall not deny the holders of securities the opportunity to decide on the merits of the bid,” said Kivejinja. According to the EAC gazette notice, the partner states are required to...

The coffee industry needs some Sh7.5 billion injection to fund revival of the once glorious subsector. Coffee subsector implementation committee said the cash will address gaps along the industry's value chain. committee chairman Joseph Kieyah last Friday said financing is one of the key components of the new reforms being fast tracked by both national and county governments. “Our worry is the declining production and lack of morale among the farmers. we are in the process of implementing a roadmap and an action plan that will prioritize on production, marketing and value addition,” said Kieyah. He added, “We are reaching out to all the value chain players to guarantee amicable consensus on the implementation of the new reforms.” Two weeks ago the committee hosted governors from 31 coffee growing counties who agreed to support the coffee reform agenda. He was at Coffee Research Institute in Ruiru at the third National Coffee Conference and Ruiru Coffee Fair 2018. The implementation committee was created in 2016 to coordinate and provide strategic leadership in implementation of the coffee reforms among other duties. Kieyah explained that of the expected money the national government will provide sh4.4 billion in the 2018/19 financial year while counties in their agriculture budgets will be required to factor in Sh3.1 billion each for the next three years. The counties will also provide extension services. He said that Sh758.4 million will be committed for fertilizer and planting materials while Sh150 million will go to training farmers. Rehabilitation of pulping stations...

A newly proposed  law on immigration and emigration in Rwanda would make it easier for people in border communities to cross borders without difficulty, Members of Parliament in the Lower House heard yesterday. The MPs on Thursday approved the basis of a draft law that seeks to amend the current law on immigration and emigration matters, which has to be reviewed to incorporate penalties on immigration and emigration related offences among other changes. While presenting the draft law in Parliament yesterday, the Minister in the Office of the President, Judith Uwizeye, said that provisions have been added in the draft law to make it easy for people living in border communities to travel to neighbouring countries. Under Article 57 of the draft law, the government has proposed that the Directorate General of Immigration and Emigration be allowed to work in consultation with local leaders and other relevant authorities to establish more crossing points to strictly facilitate movements of border communities. The draft law directs the directorate to put in place instructions governing the management of the crossing points. “It’s important that we make it easy for Rwandans to travel to neighbouring countries, especially those who live near the borders. Some of them would travel long distances to reach a gazetted border post,” Uwizeye told MPs. Immigration officials told The New Times that the move aims to close a gap in the law whereby people in some border communities were not explicitly allowed by the law to cross the nearby borders without...

Kampala. Intra-regional trade in quality cereals and pulses is expected to increase following the launch of the gazetted East African standards of staple foods. Speaking in an interview on the sidelines of the launch of the nine standards for staple foods on Wednesday by East Africa Grain Council (EAGC) in Kampala, Mr Gerald Masila, executive director EAGC, said the lack of harmonised regional standards has for a long time barred trade as each East African country has been using its standards. “We have lost out on a market position. I do not have a number right now. But Uganda could easily double its sales to the region by more than 100 per cent if the quality standards of the grains produced here meet the specifications. This means there would be fewer rejections and much more access to markets. Uganda’s commodities would be able to fetch a better price and sign up continuous supply agreements,” he said. According to EAGC RATIN, a system that gives farmers, traders and processors a gateway to regional market information, Uganda has exported about 10.1m metric tonnes of cereals and pulses within EAC and The Common Market for Eastern and Southern Africa (Comesa) countries in the last seven years. On average, the country has for the last seven years been earning Shs1.9m per metric tonne of cereals and pulses exported. Cereals The standards will affect cereals such as maize, millet, wheat, sorghum, rice and pulses such as beans and peas. The revised standards are expected to...

The construction of the much anticipated Nairobi-Mombasa expressway will begin towards the end of the year, KeNHA announced on Thursday. Communication director Charles Njogu said feasibility studies and designs were complete. Njogu told The Star Kenya National Highways Authority has also finalised deals with the largest US construction firm, Bechtel International. The project for the motorway with controlled access is expected to cost Sh230 billion. Bechtel will employ about 4,000 people and provide training and capacity building. The road will have four lanes with provisions for future expansion and will become a toll road and provide faster transit to support growth and industry. “The 473 km express highway will allow uninterrupted speeds of 120 km/h, cutting travel time from 10 to four hours,” Njogu said by phone. "This is a completely new road away that will take up a lot of money because farmers whose land will be used will be compensated." US Export Credit Agencies, including the US Export-Import Bank and the Overseas Private Investment Corporation, are expected to finance the project. Under the commercial contract, the project will be completed in 10 sections within six years. The first section, from the Namanga Road junction near Kitengela, will have an interchange near Konza City and a spur road to the Machakos turnoff at Kyumvi. This section is to be opened in October 2019. The project will include the development of a Master Plan for three Special Economic Zones along the alignment, and focus will be on developing business in coordination with the standard...

Resurgence in agriculture, infrastructure and manufacturing is expected to lift East Africa’s economic performance in 2018, an outlook by the African Development Bank (AfDB) shows. East Africa remains the fastest-growing sub region in Africa, with estimated growth of 5.6 per cent in 2017, up from 4.9 per cent in 2016. Growth is expected to remain buoyant, reaching 5.9 per cent in 2018 and firming further to 6.1 per cent in 2019. “Strong growth is widespread in the sub region, with many countries including Djibouti, Ethiopia, Kenya, Rwanda, Tanzania and Uganda growing five per cent or more” the bank says in its Africa Economic Outlook 2018. Agriculture will rebound after poor harvests last year on improved rainfall, the bank said noting that inflation spiked to nearly 10 per cent in the region, fuelled by a rise in food prices especially in Kenya, where the effects of the early 2017 drought reduced the maize harvest, causing chronic shortages of the staple. Median inflation “Median inflation is projected to fall sharply in East Africa, partly as a result of an improved harvest” the report notes. Consumerism and mega infrastructure projects are s also expected to bolster growth this year. “Private consumption is the most important driver of growth in Comoros and Kenya while public investment in infrastructure has been instrumental in Djibouti and Ethiopia. Construction will remain strong. In a few countries, continued expansion of services, including information and communications technology, will be key,” the report says. “Manufacturing may increase the share of...

Cost and time overruns are the major reasons infrastructure projects are abandoned in Kenya. This is according to a new report by Deloitte East Africa which reports that 48 percent of projects were over budget and 87 percent of projects have a time overrun. Deloitte Africa Infrastructure & Capital Projects Leader Jean-Pierre Labuschagne noted that the project overruns in Kenya were due to procurement delays – either upfront or during the construction period which results in significant cost escalations. The Deloitte Construction 2017 report finds that where projects are contracted irregularly, procurement challenges can be a major factor leading to project delays and cost overruns. “Approximately only 20 percent of projects (from inception) in Africa reach financial closure and are able to move to execution,” he added. Labuschagne says governments have a major role to play through project management, oversight, use of independent engineers, cost and delivery assurance as well as the use of technology to monitor delivery of projects. However, despite the hurdles, the number of projects in Africa increased by 5.9 percent in 2017 to 303, with the Southern Africa region contributing the lion’s share with 93 projects. East Africa registered the highest jump in the number of projects in 2017, defying a general downward trend across most African economies. East Africa, which includes Burundi, Comoros, Djibouti, Eritrea, Ethiopia, Kenya, Rwanda, Seychelles, Somalia, Tanzania and Uganda had 71 projects, a 65 percent jump. Southern Africa had a 9 percent growth while North, Central and West Africa declined by 48...

Kenya's Ambassador to Ethiopia Catherine Mwangi called on both governments to use the long and peaceful relations that exists between the countries to exploit economic opportunities. While talking to The Ethiopian Herald, Ambassador Mwangi stated that both countries need to enhance their economic engagement via the construction of infrastructures, such as roads, railways and cross-border trade corridors, as well as power transmission lines. Despite the two countries sharing longer border and having exemplary diplomatic and political ties, their economic relations have not yet reached at the desired level. With this in mind, the Ambassador pointed out that Ethiopia and Kenya need to maintain the ongoing extensive infrastructural development activities and invest in mutually-benefiting projects to replicate the strong diplomatic and political ties in the economic sphere. Ethiopia and Kenya are working on the completion and operationalization of the Ethio-Moyale asphalt road and the power transmission line that would further boost intra-trade. According to the Ambassador, the strong partnership between Ethiopia and Kenya would be the centerpiece in enhancing the economic integration of IGAD member States. She said: "Given the relatively peaceful condition of both Ethiopia and Kenya; their robust economic cooperation would have a pivotal role in pacifying the volatile East Africa and bringing prosperity to the region." She remarked that the two countries' collaboration would also contribute hugely to AU's vision of economic integration, and intensify trade and people-to-people relations in the IGAD region. Ethiopia and Kenya have waged war on poverty and are improving the living standard of...

‘America first does not mean America alone,” President Trump declared last month at the World Economic Forum in Davos, Switzerland. This sudden burst of pragmatism from an avowed nationalist showed what a difference a year can make. Denouncing the “false song of globalism” during his presidential campaign, Trump, on his third full day in office, canceled the Trans-Pacific Partnership, a regional trade deal with Japan and 10 other countries. He then denounced Canada, Germany and South Korea for exporting more to the United States than they import. He promised to renegotiate trade pacts with Europe, Canada and Mexico and get a better deal for American workers. In Davos, however, he reached out with conciliatory words to the very free-trading and globalizing elites he has consistently maligned. Clearly, Trump’s views on trade and globalization have evolved since his insurgent campaign. This may well be because of the rapid gains in the past year of a country he did not mention by name. In fact, Trump chose in Davos to affirm that “America is open for business” because it was in these same Alpine heights, three days before Trump was inaugurated as president, that China seized the opportunity to claim leadership of the global economy. With the United States seemingly in a protectionist crouch, China had become, despite all its problems, indispensable. “In a world marked by great uncertainty and volatility, the international community is looking to China,” Klaus Schwab, the founder of the World Economic Forum, said last year while introducing...

East Africa remains the fastest-growing sub-region in Africa, with estimated growth of 5.6 percent in 2017, up from 4.9 percent in 2016. This is according to the recently launched 2018 African Economic Outlook. The report notes that Africa’s growth is expected to remain buoyant, reaching 5.9 percent in 2018 and 6.1 percent in 2019. Strong growth is widespread in East Africa, with many countries including Djibouti, Ethiopia, Kenya, Rwanda, Tanzania and Uganda growing 5% or more. The report also attributes the accelerated growth particularly in Kenya and Comoros toprivate consumption while also pointing out that public investment in infrastructure has been instrumental in Djibouti and Ethiopia. It also indicates that construction activity will remain strong. In a few countries, continued expansion of services, including information and communications technology, will be imperative. Manufacturing activity may increase the share of industry, particularly in Kenya and Tanzania. From here at Optiven, we believe that this positive outlook, especially on construction activity in Africa, and in Kenya by extension, is a positive thing for the real estate industry. “We are extremely excited to be part of the key drivers who will help accelerate Kenya and Africa towards more economic prosperity. We envisage an Africa that will have addressed housing conditions for the millions of Africans who still have no place to call home,” says Mr. George Wachiuri, CEO, Optiven Group. African economies have been resilient and gaining momentum. Real output growth is estimated to have increased 3.6 percent in 2017 and to accelerate to...