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Tuesday, 04 Feb 2020

Netflix charges have dropped after the company changed its billing for Kenyan customers

Insights Africa

Economic Outlook

Economic Outlook

  • Kenya is ahead of her peers in Africa in terms of green energy. Lake Turkana Wind Power Plant is the biggest in Africa. Some miles to the south of this power plant lies Biojuole Energy, in Naivasha, the biggest biogas fired power plant in Africa, at 2.4 MW.
  • Kenya failed to raise enough in Treasury bill auctions since the beginning of 2020 to roll over maturing short-term debt despite all the sales being oversubscribed, illustrating the growing burden to refinance domestic debt. The Central Bank of Kenya reported that the regulator accepted a total of 6 BN KEs (1.2 BN USD) from investors in the past five T-bill auctions, against maturities worth 144 BN KES (1.4 BN USD).
  • Kenya will hold discussions with the International Monetary Fund (IMF) from March about a cautionary facility. Central Bank of Kenya (CBK) Governor Patrick Njoroge stated that Kenyan officials are not under pressure to secure a deal within set deadlines, as the Kenyan economy is well protected against capital outflows.
  • Kenya fiscal and monetary policies have been conflicting, raising concerns among investors who rely on them to make decisions. The Central Bank of Kenya (CBK) has moved towards a more accommodative stance to encourage commercial banks to boost lending to the private sector.
  • Uganda plans to borrow 9 TR KES (1.89 BN USD) from external lenders in 2020/2021 to partly finance its budget, which could come under pressure as veteran leader Yoweri Museveni seeks re-election.
  • Rwanda and Zimbabwe are set for further economic and trade cooperation, with the two countries set to hold a Trade and Investment Conference from March 24-26 in Kigali (Capital of Rwanda). Noting that an MoU will be signed at the conference to create market access between the two countries.
  • Zimbabwe, in partnership with the World Bank, are planning to introduce a competitive program for procuring large-scale photovoltaic solar power gadgets under the recently completed National Renewable Energy Policy (NREP), aiming at securing Zimbabwe's long-term energy supply needs in a sustainable way.
Political Events

Political Events

  • The World Food Program (WFP) has appealed to the international community to step up support to Zimbabwe to help millions of people facing hunger due to a prolonged drought and economic collapse.
  • Kenya will trade with the United Kingdom under the current preferential terms only up to December 31, just one week after its official exit from the European Union (EU). From January, the trade arrangement will have to shift to the terms agreed under a new deal that the UK hopes to conclude with the East African Community bloc this year.
Stock Market

Stock Market

  • The Nairobi Securities Exchange (NSE) registered net positive foreign flows in January 2020 compared to negative flows in similar months in the past two years even at a time its turnover was down. Data from Standard Investment Bank (SIB) shows that net foreign flows increased reaching 529 MM KES (5.27 MM USD) compared to a net outflow of 1.34 BN KES (13.38 MM USD) in January 2019 and 1.38 BN KES (13.76 MM USD) in January 2018.
  • The Nigerian Stock Exchange (NSE) is set to launch its Growth Board at The Exchange, Lagos on Wednesday, 29 January 2020. The launch of the Growth Board provides issuers with the opportunity to leverage on the Exchange for listing, raising long term capital and facilitating liquidity in the trading of their shares.
Companies Transactions

Companies Transactions

  • Netflix charges have dropped after the company changed its billing for Kenyan customers from the US dollar to the local currency. Netflix has reviewed its rates to 700 KES (6.97 USD) for the basic package, 950 KES (9.45 USD) for standard and 1,200 KES (11.94 USD) for the premium package. The biggest price cut is on the basic package which has dropped by up to 100 KES (1 USD) on the new Kenya shilling billing.
  • East African Breweries Limited (EABL) spent 300 MM KES (3 MM USD) to acquire an additional 4% stake in Serengeti Breweries Limited, raising its ownership in the Tanzanian subsidiary. The deal, which has been disclosed by EABL’s parent company Diageo Plc, was completed in July last year following the approval from Tanzania’s Fair Competition Commission.
  • The Capital Markets Authority (CMA) has ordered money market funds to disclose in detail where they have invested clients’ cash as well as the terms of those deals following revelations of investment gambles that have lost investors billions of shillings.
  • Logistics firm Sendy, which operates an app linking delivery drivers with customers, has raised 2 BN KES (19.9 MM USD) in funding from a group of institutional investors including Japanese conglomerate Toyota Tsusho Corporation (TTC).
  • Private equity firm Kuramo Capital risks losing a total of 699 MM KES (6.9 MM USD) worth of loans it had advanced to TransCentury, the parent company of East African Cables, which is facing a liquidation suit.
  • The national Tanzanian carrier has chosen handling agent Swissport as its service provider at the carrier’s Dar es Salaam and Kilimanjaro Airport hubs. The support includes the entire package consisting of cargo and baggage handling, security checks, gate services, passenger check-in and the moving of aircraft on the stands.
  • A Nairobi High Court judge has allowed I&M Bank Rwanda Limited to recover close to 100 MM KES (995,123 USD) from former Nakumatt chief executive officer Atulkumar Maganlal Shah, signaling more trouble for the fallen giant supermarket chain.


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