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Wednesday, July 31, 2013

Cost of living 5 Best Travel Destinations to Stretch Your Dollar

 5 exciting destinations where the dollar goes far (Corbis)
Cost of living


Vacation season is well underway, and while most Americans will be traveling within the United States, with the dollar up about 10% from two years ago--and expected to strengthen even more--you might want to consider a foreign destination.


“As the dollar has more muscle to flex abroad, I think people become much more comfortable with this notion of traveling internationally and being savvy about which destination they select to allow their dollar to take them even further,” says Gabe Saglie, the senior editor for Travelzoo.com.
Related Tool: How Much am I Spending?


Here are five exciting destinations where you can really stretch your dollar...all with package deals recently listed on Travelzoo for under $1000!


1) Mexico
With its deep history, endless beaches, a low-cost currency, it’s always a top destination, says Saglie. “There are bargains to be found year-round south of the border, but if you look at the summer travel season--late summer to very early fall--that’s when we’re seeing some pretty dramatic savings on the ground—like hotels at reduced rates of 50-60%, or even 70% off.”


The resorts of the Riviera Maya offer meals and every amenity under the sun. And if you want to explore down the road to Tulum, you can enjoy a fish taco meal for about $5!


2) Canada
It offers endless, and inexpensive activities for the outdoor enthusiast like whale watching, hiking and biking. You’ll work up an appetite, but the meal will come cheap: share a stack of buttermilk pancakes in Vancouver for about $10.


3) Dominican Republic
If gorgeous beaches aren’t enough to lure you, try scouting the Major League’s next big baseball stars at Santo Domingo’s Quisqueya stadium where the best seats in the house are all under $20.


4) Costa Rica
There’s something for everyone here! Beautiful rain forests, dramatic volcanoes and perfect waves have made this country one of Latin America’s most popular destinations. While prices have risen a bit in recent years, you can still rent a surfboard for $15 a day, enter one of the many national parks for about $10, and enjoy a delicious casado, or meal of the day, for less than $5.



5) Western Europe
Don’t rule it out! Hotel rates in financially troubled countries like Greece, Spain and Ireland are down by as much as 7% year over year, according to hotels.com.
“Some of these troubled destinations can be some of the best havens for value on the other side of the Atlantic,” says Saglie. “Granted, on the ground, some of your day to day incidentals may not be cheap, but getting you there--and staying there--can certainly be an affordable alternative to other western European destinations.”


Related tool: Currency Converter
Wherever you go, know your exchange rate and avoid paying excess fees on your daily purchases. Fodor’s says to change your money at ATM’s, especially if your bank is global or partners with a local affiliate; avoid airport and hotel exchange booths; and use credit cards for big purchases. For a list of the best cards that won’t charge you costly conversion fees, go to nerdwallet.com.

5pc withholding tax increases burden, TRA told


Minister for Finance William Mgimwa 

By  Alawi Masare 
In Summary
  • Ernst & Young paid back $125 to its clients after the training but a number of people left without getting the $5.

Dar es Salaam. Taxpayers are concerned about the newly introduced withholding tax on services, saying it is inconvenient and increases administrative burden on them.


Speaking during the Ernst & Young Finance Act 2013 training at a city hotel yesterday, Ernst & Young clients said administration of the 5 per cent service fees charged on every payment is a problem.


“We see this as another administrative burden bearing in mind that whatever you pay, regardless of the amount, you need to withhold 5 per cent and remit it to Tanzania Revenue Authority,” said Gilbert Zannie, tax and treasury consultant at Coca-Cola Kwanza. The tax was introduced in 2013 effective July 1 as stipulated in the finance act. It did not specify the kind of services and the amount (threshold) to be charged.
Ernst & Young paid back $125 to its clients after the training but a number of people left without getting the $5.


“We are following the rules but it is hectic to pay this ridiculous amount to our clients.it’s extremely an administrative burden. It just doesn’t make sense…there is neither threshold nor exemptions,” remarked Silke Mattern, Partner, International Tax East Africa at Ernst & Young.


She said the process of charging it, remitting to TRA and issuing certificates consumes a lot of time that they need to employ a person who will deal with it alone.


“We have it back home in Ghana. However, the issue here is its administration. It’s very cumbersome from collecting to remitting it to the revenue authority and issuing certificates,” said Alex Ankomah, finance manager at Advans Bank Tanzania.

PM free from lawsuit: Bunge


 
Prime Minister, Mr Mizengo Pinda 
By  Frank Kimboy 
In Summary
Since the Prime Minister is an MP he can’t be sued but if LHRC wants to go to the court they can do so because the court is the body that interprets the laws.



Dar es Salaam.The Legal and Human Rights Centre cannot sue the Prime Minister, Mr Mizengo Pinda, for the remarks he made in the Parliament because he, just like other legislators, enjoys parliamentary privileges and immunity.


Speaking to reporters on Monday, the centre’s advocacy and reforms director Harold Sungusia said LHRC was planning to sue the Premier over his remarks to the effect that should go ahead and beat up people who defy instructions by law enforcement and security agencies.


But when contacted for comment, the director of parliament business, Mr John Joel, said the constitution gives immunity to Members of the Parliament such that they cannot face charges for remarks they make in the parliament.


“Since the Prime Minister is an MP he can’t be sued but if LHRC wants to go to the court they can do so because the court is the body that interprets the laws,” said Mr Joel.


He said the parliamentarian can only be held responsible for what they say in the National Assembly by using the Parliamentary standing orders.


In the Prime Minister’s case, Mr Joel said, if it was true that his statement violated the Constitution, as claimed by LHRC, an MP could table a no confidence vote against him so as to remove him. “An MP can succeed after he moves a “No Confidence” vote against the PM after collecting 70 signatures of fellow MPs,” he said.


But when he announced LHRC plans to sue the Prime Minister Mr Sungusia said they were aware of Article 100 but insisted that LHRC made consultations before making the decision. He argued:


“The Constitution stipulates that a person is considered innocent until proven guilty. Since Mr Pinda gave government’s stand on the matter, the issue of privileges doesn’t arise...we’ll file a case at the High Court before the end of the week,” Mr Sungusia said.

No money for teachers, says government


 
Unatu district chairpersons raise their hands in support of a strike during a meeting in Kampala last week. PHOTO | NMG 

In Summary
  • On Thursday, Mr Museveni made a U-turn directing that a committee to be headed by Education Minister Jessica Alupo be formed with an aim of finding money to meet the teachers’ 20 per cent pay rise.

Kampala. The Minister of Finance, Ms Maria Kiwanuka, yesterday said there was no money for teachers’ salary increment, days after President Museveni directed that money be allocated. She was backed by her technical team explaining that the Treasury cannot afford to pay any more money to teachers than it has currently budgeted for.


Speaking at a dialogue organised by the Civil Society Advocacy Budget Group with the parliamentary Finance Committee, the acting director of the Budget in the Mnistry of Finance, Mr Kenneth Mugambe, said: “Out of Shs2.3 trillion wage Bill, nearly a trillion is spent in salaries in the Education sector alone.”


“If we increase the salaries, it means we will need close to Shs400 billion. And the moment you do that, you would have created another demand - because health workers, policemen, people in defence will all want a pay rise. And this is not sustainable.”


On Thursday, Mr Museveni made a U-turn directing that a committee to be headed by Education Minister Jessica Alupo be formed with an aim of finding money to meet the teachers’ 20 per cent pay rise.


“The President has directed that the 20 per cent increment for teachers’ pay be paid. The minister is supposed to analyse the budget and find the money,” Mr James Tweheyo, the general secretary of the Uganda National Teachers’ Union, said after the union’s meeting with the President.


However, Ms Kiwanuka yesterday indicated she was not aware of the directive, saying: “If the teachers think that the money is somewhere then let them direct the minister (Ms Alupo) to where the money is.” But the teachers, through their association Unatu, yesterday insisted that they will not open Third Term if the government does not honour its pledge by September 16.

Oil prices down in Asia over US stimulus clues


 
 

In Summary
  • New York’s main contract, West Texas Intermediate for delivery in September, was down 26 cents at $104.29 a barrel and Brent North Sea crude for September eased 10 cents to $107.35.

Singapore. Oil prices dipped in Asian trade yesterday as investors paused ahead of a US central bank meeting, hoping for clues about the future of its stimulus.

New York’s main contract, West Texas Intermediate for delivery in September, was down 26 cents at $104.29 a barrel and Brent North Sea crude for September eased 10 cents to $107.35.


Analysts said investors were taking a breather from a recent rally while waiting for a meeting yesterday of the US central bank’s policy-setting Federal Open Market Committee (FOMC). (AFP)

Mugabe,Tsvangirai head to presidential polls as world watches closely


 
Robert Mugabe 
By Mkinga Mkinga  
In Summary
  • Tanzania, being the chair of the Sadc organ on politics, defence and security cooperation, is satisfied with the electoral process so far.

Harare. Zimbabwe is set for the its general elections today as the whole world is watching. At the same time the Southern African Development Community is taking a front observation mission here.


Four presidential candidates mega shots will be seen in the ballot papers leaving alone the Members of Parliament and Ward councillors. Candidates eying statesmanship are the incumbent Robert Mugabe (ZANU-PF), Morgan Tsvangirai (MDC-T), Dumiso Debengwa (Zapu) and Welshman Ncube (MDC).


However, tough competition pits the two opponents, President Robert Mugabe and his Prime Minister, Mr Morgan Tsvangirai. In the 2008 elections Tsvangirai emerged winner although he did not get 50 per cent and, therefore, there was a runoff which he rejected due to violence and President Mugabe went unopposed.
Tanzania, being the chair of the Sadc organ on politics, defence and security cooperation, is satisfied with the electoral process so far.


Speaking to The Citizen, Sadc head election observers mission, Tanzania’s Foreign Affairs and International Cooperation minister Bernard Membe said Zimbabwe is well prepared.


He said 6.4 million Zimbabweans will exercise their democratic right today and that they hope the elections will be free, fair and transparent and people will restrain themselves from turning violent.


As Sadc has been advocating for free and fair elections already the main oppositions MDC-T have been complaining on the voters role (permanent voters register) that as they going to elections ZEC has not issued a country’s voters role.


Speaking to stakeholders in Harare, Zimbabwe Electoral Commission (ZEC) chairman Justice Rita Makarau said the voters’ roll would be available only in hard copy from the registrar general’s office, as opposition political parties complained about the unavailability of the information two days before national elections.


Under Zimbabwe’s electoral laws, the political parties are entitled to have the voters’ roll, which is said to have 6.4 million voters who will take part in the poll the highest voter turnout since the country’s independence in 1980.


“Copies of the voters’ roll can now be obtained from the registrar-general’s office in hard copy, but electronic copies cannot be obtained,” Justice Makarau said


Adding that “Each polling station will now have a copy of the voters’ roll. Due to logistical problems we can’t issue electronic copies of the voters’ roll.”


In 2008 elections MDC-T won 100 seats while Zanu-PF had 99 seats. The opposition has a good command in most of the urban areas while the ruling Zanu-PF is also having a command in rural areas and some parts of urban areas.

Thai PM arrives for three-day visit


 
President Jakaya Kikwete with Thai Prime Minister Yingluck Shinawatra at State House, Dar es Salaam, yesterday. Tanzania and Thailand signed four bilateral agreements, shortly after Ms Yingluck’s arrival. PHOTO | EDWIN MJWAHUZI 
By The Citizen Reporters 
In Summary
  • Tanzania and Thailand later signed four bilateral agreements at State House. The signing ceremony was witnessed by President Kikwete and Ms Yingluck and attended by senior government officials from the two countries.

Dar es Salaam. Thai Prime Minister Yingluck Shinawatra arrived in Dar es Salaam yesterday for a three-day visit to Tanzania.


Ms Yingluck’s arrival was low-key compared to that of US President Barack Obama, who visited Tanzania under the glare of the world’s media last month. Many Dar es Salaam residents first became aware of the arrival of Ms Yingluck, 46, after seeing the motorcade that carried Thailand’s first female prime minister and her host, President Jakaya Kikwete, drive from Julius Nyerere International Airport (JNIA) to State House.


Ms Yingluck’s plane touched down at JNIA at around 1.10 pm, and she was warmly received by President Kikwete and top government officials. The visitor received a 19-gun salute before inspecting a guard of honour mounted by the Tanzania People’s Defence Forces.
She was also treated to traditional dances by various groups.


Tanzania and Thailand later signed four bilateral agreements at State House. The signing ceremony was witnessed by President Kikwete and Ms Yingluck and attended by senior government officials from the two countries.


The agreements included one on the extradition of convicts. The two countries have also agreed to promote and protect investments.

Others are memorandums of understanding on technical collaboration and cooperation between Tanzania’s Ministry of Energy and Minerals and Thailand’s Gem Institute.


Ms Yingluck was later yesterday scheduled to attend a forum of businesspeople from Tanzania and Thailand and a trade exhibition. President Kikwete was in the evening scheduled to host a state dinner for his guest.
Ms Yingluck is today expected to visit Serengeti National Park. She is scheduled to leave for Uganda tomorrow.


Ms Yingluck became prime minister of Thailand after the 2011 general election. At 46, she is the youngest Thai prime minister in over 60 years. She belongs to the Pheu Thai Party.


Born in Chiang Mai Province into a wealthy family of Chinese descent, Ms Yingluck earned a bachelor’s degree from Chiang Mai University and a master’s degree from Kentucky State University, both in public administration. She became an executive in the businesses founded by her elder brother, Thaksin Shinawatra, and later became the president of property developer SC Asset and managing director of Advanced Info Service. Meanwhile, her brother Thaksin became prime minister, but was overthrown in a military coup, and went into self-imposed exile after a court convicted him of abuse of power. In May 2011, the Pheu Thai Party nominated Ms Yingluck as its candidate for Prime Minister in the 2011 general election. She campaigned on a platform of national reconciliation, poverty eradication, and corporate income tax reduction.
Reported by Alex Bitekeye and Katare Mbashiru

Dar gets Sh342 billion WB loan to upgrade key road

 
Minister for Finance William Mgimwa 
By  Sturmius Mtweve 
In Summary
  • He noted that the fund would also be used in improving road safety and traffic conditions by conducting road safety audits and capacity management reviews in a bid to curb the impact of HIV/Aids and other diseases made worse by inefficient transport.

Dar es Salaam. Tanzania and the World Bank’s International Development Association (IDA) yesterday signed a $210 million (about Sh341.61 billion) loan agreement to facilitate the implementation of the Southern Africa trade and transport system.


The loan, according to minister for Finance William Mgimwa, will be used to improve physical infrastructures with a focus on upgrading and rehabilitation of the 140km Mafinga-Igawa highway covering Iringa and Mbeya regions respectively, along the Dar es Salaam corridor. “In this project, we also aspire to improve the Songwe-Kasumulu border post by building a one-stop centre to facilitate an easy movement between Tanzania and its neighbours,” said Dr Mgimwa at the signing ceremony in Dar es Salaam yesterday.


He noted that the fund would also be used in improving road safety and traffic conditions by conducting road safety audits and capacity management reviews in a bid to curb the impact of HIV/Aids and other diseases made worse by inefficient transport.


“This support has come at a time when the government is in a critical need of implementing interventions to facilitate the movement of goods and people along the North-South Corridor to enable Tanzania to become the transport and logistics hub for neighbouring countries,” said Dr Mgimwa


The minister said that apart from facilitating movement, the Southern Africa Trade and Transport Project aims at opening up doors for other countries in the region to use the available trade outlets and cement ties in the Southern corridor. He said the loan would also be used in supporting integration efforts in both the Sadc and the East African regions as well strengthening the intra-African trade relations that encourage exportation and importation of goods and services.


In making the initiative effective, the minister said, all the relevant institutions like the Tanzania Revenue Authority (TRA), Tanroads, the Tanzania Commission for Aids and the ministry of Health and Social Welfare would be involved in designing the best ways the project would be implemented.


“We are thankful over the cooperation we have been receiving from the World Bank, and I would like to assure that the loan will be used to cater for the intended purpose and not otherwise,” affirmed Dr Mgimwa who added that Tanzania’s strong partnership with the world financial prefect would be maintained.

Villagers sue African Barrick Gold for deaths in a London court

 
Mining trucks at Barrick Gold’s Pascua-Lama project in northern Chile. Local Barrick subsidiary,  ABG, has come under fire over the heavy-handed response of its security personnel during protests at its North Mara operations two years ago that ultimately left 6 people dead. PHOTO | AFP 
By The Citizen Reporter  (email the author)
In Summary
  • Twelve villagers, including one man who has been left paraplegic, are suing the companies in the hope of receiving just compensation.

Dar es Salaam. Twelve villagers living in the neighbourhood of North Mara Gold Mine have sued African Barrick Gold (ABG) in the UK High Court for the death of six of their relatives, who were shot by police in 2011.


A London law firm, Leigh Day, filed the case on behalf of the villagers and yesterday served ABG and North Mara Gold Mine Limited with the legal papers.


The ABG office in Dar es Salaam said it was aware of the case and is committed to “addressing legitimate grievances in an open and transparent way”. The firm was quick to assert, though, that it will not compensate illegitimate claims or lawsuits.


ABG, whose gold mining activities are all in Tanzania, is registered as a limited company in London.
It is also listed on the London Stock Exchange and cross-listed on the Dar es Salaam Stock Market. It owns North Mara, Bulyanhulu, Tulawaka and Buzwagi gold mines – all in the lake zone.


The firm said in a statement yesterday: “We understand that the majority of the claims in this case originate from an incident in May 2011. A small number of additional claims have been brought by intruders who illegally entered the mine on other occasions. In the event any legal proceedings are pursued, ABG will vigorously defend itself against all the claims.”


Leigh Day confirmed yesterday that it was representing the villagers and said ABG and North Mara Gold Mine should take responsibility for the deaths and injury of local villagers, including “complicity in the killing of at least six local villagers by police” at the North Mara mine. The companies deny the allegations.


“Twelve villagers, including one man who has been left paraplegic, are suing the companies in the hope of receiving just compensation,” Leigh Day added.


The firm said it started the legal proceedings in collaboration with the Legal and Human Rights Centre of Tanzania, which has sought to highlight what they describe as a serious human rights situation at the mine.


The North Mara mine, which sits amidst seven villages, has been the scene of frequent clashes between security personnel guarding the mine and intruders said to come from neighbouring villages.


Intruders often attempt to gather rocks from the mine in the hope of finding tiny amounts of gold. It is alleged that police are an integral part of the mine’s security and that they shoot at the villagers using teargas and live ammunition.


The legal claims filed in the UK relate to incidents occurring over the past three years, including one in which five young men were shot and killed on May 16, 2011, according to Leigh Day.

A highy profitable multi-media firm built from scratch

A highy profitable multi-media firm built from scratch

Mr Oboth takes photographs during a wedding session in Kampala recently. Photo by Rachel Mabala. 
By Lydia Namono
In Summary
Mr Oboth, the multi-media proprietor shares what it is like to start a company and what it takes to bring in the money.



Tucked away in Ntinda, a Kampala suburb, Media 256, which produces documentaries, film, weddings, commercials and corporate videos was founded in 2010 by 23-year-old Isaac Oboth.


The multi-media business owner had never run a business; neither had he worked in a media company when he conceived the idea.


Mr Oboth discovered a passion in himself that he could monetiseand restructured his life, earning him freedom and fulfilment.


His entrepreneurial journey started out of a desire to keep some memories of his Senior Six luncheon.
“The people who filmed the luncheon gave us poor quality work yet the charges were quite on the extreme.

So if they were paid such money for the poor quality works, how much more would I earn for doing a better job?” Mr Oboth asks.


Mr Oboth wanted to create a digital year book but the idea could not materialise so he pushed it to the following year.


His business acumen told him it had to be affordable. So he eliminated printing costs of the photographs and produced a digital alumni album.


The self-taught owner signed up for tutorials on the internet to improve his skills.


“I spent more than 20 hours a day behind the computer experimenting for four months until it worked out,” Mr Oboth narrates.


Since he did not have all the necessary tools, he teamed up with Mr Henry Ngonzi, who already had gained expertise and better understanding of the selling aspect of an enterprise.


Through the use of inter-personal skills, the business has made a breakthrough as a major media company in Uganda.


While working in Nairobi for Mara Foundation, his salary was not that impressive, but he pressed on for opportunities that could come with handsome rewards.


“We saw an advert of an event that was due in Kampala, so I called the team and shared to see if we could do the job. We gave them samples of our works and they were impressed, Mr Ngonzi shares.


Luckily, among some of Mr Oboth interviewees was the managing director of the Ethiopian Commodities Exchange and she wanted someone to produce a short film with a mix of farmers, millers and stock brokers.
Through this, the exchange would emphasise the relevance of the commodities exchange on the Ethiopian market.

Rising prices spur illicit cigarette trade


  Rising prices spur illicit cigarette trade
Smokers are paying high prices for cigarettes after the tax increments. Photo by Stephen Wandera. 
By Ismail Musa Ladu
In Summary
Uganda is in third position in terms of smoking incidence in EA after Kenya and Tanzania.



The government’s move to slap an 11 per cent excise duty on cigarettes has driven the commodity’s prices northwards forcing smokers to resort to illegally imported cigarettes.


This has been seen to gain rapid growth, in northern Uganda and West Nile where legally registered tobacco companies are facing stiff competition from illicit cigarette brands that are not only cheap but have little impact on the growth of the country’s Treasury.


Industry players say they are not surprised about the growth in illicit cigarette trade as an increase in taxes tends to push consumers to cheap and affordable cigarette brands.


According to industry statistics about 15 per cent of the market consumes illicit tobacco products, translating into more than Shs7 billion in revenue loss.


A Prosper mini survey indicates that most of the illicit cigarettes come from South Sudan.
According to URA such items are normally disguised as exports only to end up in the country without paying excise duty as required by law.


“I am not selling as much as I should because there are cheap smuggled brands on the market which sells at a slightly cheaper price,” Mr Sam Onyuthi, a retailer in Arua said.


He added: “This has been worsened by the fact that the price of some cigarettes brand have increased.”


Impact of tax increment
Following the tax increment, the market leader, British American Tobacco recently announced a price increase of its premium brands from Shs4,000 to Shs5,000 a packet. However, the company’s flagship brand Sportsman was maintained at Shs150 per stick for retail prices.


In an interview with the Prosper last week, BAT’s corporate and regulatory affairs manager Diana Apio-Kasyate, said enforcement should be beefed up to take care of illicit trade.
She said illicit trade has the potential to not only eat into genuine companies’ market share but also causes loss of revenue to the government

Rising exports boost Uganda’s coffee output


  Rising exports boost Uganda’s coffee output
 
By Dorothy Nakaweesi
In Summary


Coffee production in Uganda continues to post positive signals due to increased production and rising export volumes.



An increase in coffee production as well as rising export volumes continue to position Uganda as a key producer both in Africa and globally.


Experts say that if the performance continues throughout the last quarter of the coffee calendar, Uganda might see itself jump into major coffee producing countries hence improving farmers’ living condition.


The 2012/13 global production is estimated to yield 144.6 million bags, a 7.8 per cent increase due to increased output from Africa, Asia, Oceania and South America.


According to available data Uganda has already taken a major leap the in coffee export.


According to the Uganda Coffee Development Authority, Uganda’s coffee continues to show signs of strong growth for both volumes and value.


A UCDA report shows that coffee exports in June - the ninth month of the coffee calendar, amounted to 361,146 kilogramme bags worth $42.77 million.


This comprised 284,050 bags ($ 32.16m) of Robusta and 77,096 bags ($ 10.61m) of Arabica.
Robusta increased by 31.54 per cent and 19.79 per cent in terms of volume and value respectively, while Arabica increased by 30.43 per cent in volume and by 4.46 per cent in value compared to the same period last year [2011/12].


On a year-on-year basis, coffee exports for the period (July 2012-June 2013) totalled 3.36 million bags worth $422 million, the report shows.


Experts say the concerted growth is likely to elevate Uganda to a production capacity of 4 million 60 kilogramme bags.


Uganda is ranked second as one of Africa’s leading coffee producer after Ethiopia.
The report further says coffee exports by type, and grade realised a price increase for each coffee grade during the month of June 2013.


Robusta accounted for 78.65 per cent of total exports, 0.14 per cent higher than what was realised in the same period last year, the report noted.


Average robusta price was $1.89 per kilogramme, four cents lower than the price in May 2013.

Mombasa-Kigali rail to be finished by 2018


  Mombasa-Kigali rail to be finished by 2018
A dilapidated section of the Kampala - Mombasa railway line. Photo by Faiswal Kasirye.  
By Frederic Musisi
In Summary
The overall cost of the railway line is about Shs33 trillion and the governments are contemplating looking to China for funding.

 

The Ministry of Works and Transport has said the construction of the Mombasa-Kigali railway line will be completed in March 2018.


Addressing journalists yesterday, Mr Abraham Byandala, the Minister of Works said the heads of State of Uganda, Kenya and Rwanda meeting in June in Kampala tasked Uganda to spearhead the development of the railway line from the Mombasa port.


“The leaders agreed to undertake the development of a standard gauge railway (SGR) as a regional project,” he said.


He said feasibility studies for the first phase of the railway from Mombasa to Nairobi covering 500 Kilometres are complete and ground breaking is scheduled for November.


Second phase
The design for Phase II of the line covering 511 Kilometres from Nairobi to Malaba is being undertaken by the Kenya Railways Cooperation and will be complete by 2013.


Design for the Kampala to Malaba line covering 250 Km will be complete by October 2013 in which a second phase of the Tororo-Packwach railway line was completed in 2011.


Phase III of 344 Km will cover Kampala to Kasese en route to Bihanga-Mirana hills (200 Km).
The government of Rwanda will develop the 200 Kilometres line from Mirama hills to Kigali.


“The Rwandan government has agreed to connect to the Kampala-Kasese line,” said Engineer John Byabagambi, the minister of state for Works.


The overall cost of the railway line is $13 billion (about Shs33 trillion) and the governments are contemplating to look to China for the funding of this ambitious infrastructure by March 2018.


Mr Byabagambi stressed that once completed, the passenger track will travel at 120 Kilometres per hour and 80 Km per hour for cargo estimated to be 25 metric tonnes from the current of 15.


Fate of RVR
The ministers acknowledged that Rift Valley Railways (RVR) — the company with a concession to operate the Kenya-Uganda railway line— will remain operational.


RVR recently launched a Shs24 billion technology upgrade on the line to centrally control the movement of trains and cargo along the railway tracks which was dubbed a major revamp.


A ministerial committee comprising of Mr John Byabagambi, the Kenyan and Rwandan ministers was formed to jointly steer the development of the project.


Meanwhile, the Chinese infrastructural contractor-China Construction Engineering (CCE), was given a contract to develop the Tanga-Musoma railway line, which is expected to link the Bukasa port.

New survey casts cloud on country’s business climate


New survey casts cloud on country’s business climate

The high cost of inputs, poor transport infrastructure and competition, electricity cost, high tax rate and inadequate capital are the biggest constraint in doing business. File Photo.  
By Martin Luther Oketch
In Summary


Slow recovery of economic activity in the European Union has continued to negatively affect Ugandan export-oriented sectors.



Uganda’s business climate during the first quarter of the year declined, casting a cloud on prospects for economic recovery this year.


Findings from the Economic Policy Research Centre (EPRC) Business Climate Survey for January to March 2013 for quarter one of 2013 show a decline in the business climate from 104.5 in quarter four of 2012 to 97.6, signifying a deceleration in the business activity.


The research released on Friday was collected from 150 firms with the aim of assessing business economic conditions.


EPRC economists told the Daily Monitor that the perceived reduction in business activity was due to persistence of some downside risks that ensured that both the current and expected business conditions are below potential.


The economists argue that between January and March, the business climate depreciated, albeit weakly, on account of reduced demand for products and services particularly for the retail and wholesale trade, perceived increased business competition coupled with the persistence of some binding constraints in doing business.


“These negative occurrences affected businesses despite an improving macro-economic environment characterised by stable inflation, exchange rates and falling interest rates,” said Mr Joseph Mawejje, a research fellow at EPRC.


Mr Mawejje said reduced consumer demand was the main reported driver of a weak business climate. “Business activity and turnover reduced across all sectors as compared to the previous quarter,” he said.


The survey shows that the balance scores which show the difference between the percentage of respondents who reported a positive outcome and a negative outcome for a given evaluation indicator, were negative for business activity and turnover across all sectors.


In the agricultural and agro-processing sector, 55 per cent of businesses reported declined turnover. The reduced demand is reportedly due to a downcast consumer sentiment for both the domestic and international markets.


Increased competition in the wholesale and retail trade sector was the second most reported driver of reduced business climate.


Donor aid cuts are also partly to blame. Following strong allegations of misappropriation of donor-funded public funds in some government ministries, numerous development partners agreed to freeze all direct budgetary support to Uganda. The aid squeeze may have delayed fulfilment of critical government duties including payments of civil servant salaries.

GOtv claims dominance of the local market


  GOtv Uganda Brand Segment Manager, Ms Patricia Kiconco.
GOtv Uganda Brand Segment Manager, Ms Patricia Kiconco. COURTESY PHOTO 

In Summary
GOtv Uganda is a product under service provider of MultiChoice which offers a variety of interesting programmes to its viewers across the continent. Ms Patricia Kiconco, the brand segment manager, MultiChoice Uganda, spoke to Daily Monitor’s Yoweri Maganda



You seem to be enjoying a rich market for GOtv Uganda services in the central region. What is your opinion about the Kabaka’s 20th coronation anniversary?
Traditional and cultural heritage are values that we respect at MultiChoice because we consider them to be the essence of our identity.


As an African company, we fully understand and respect the value that tribes such as Baganda give to their king. We know he plays a very important role in uniting people with other groups both within and outside the country.


Comment on the pay TV sector in Uganda
The industry is relatively small but growing very fast. Currently, about 15-20 per cent of all the television users in the country have access to pay television services. As MultiChoice, we have tried to stimulate demand for Pay TV services by improving on the quality of our content, introducing new bouquets and lowering the charges. Our GOtv decoders have been priced at Shs79,000 and this includes a decoder, external grid antenna and one month subscription.


What GOtv packages are you offering in Uganda?
We are currently offering three bouquets namely GOtv, GOtv plus and GOtv Open. GOtv, which is our basic package costs Shs18,000 per month and comes with over 20 channels, GOtv plus comes with over 30 channels at Shs25,500 per month, whereas with GOtv Open, which costs Shs84,000, the customer pays a one off lifetime fee and is able to access all local channels available on our digital terrestrial platform.


Recently, GOtv Uganda made two years of operations in Uganda. What are your major achievements?
GOtv Uganda has managed to become the market leader on the DVB T2 DTT (Digital Video Broadcasting second generation terrestrial Digital Terrestrial Television) platform, which is the digital standard that the Uganda Communications Commission adopted for Uganda’s digital migration.


We managed to reach this position because right from the beginning, MultiChoice made a conscious and deliberate decision to invest in the latest digital technology DVB T2, which is a much more advanced and stable technology compared to DVB T1, a standard that has been phased out in most parts of the world. We have also managed to provide quality content to our customers.


What is the current market share and portfolio of the GOtv Uganda brand?
Currently, we account for over 95 per cent of the DVB T2 market, the standard that the country has decided to adopt in its migration from analogue to digital broadcasting.


What challenges have you faced since the inception of the brand in the country?
Our biggest challenge has been taxation, which has made our products a little bit expensive for many of our potential subscribers. We have also faced the problem of unstable power supply which has made our customers fail to purchase our services.


You are set to commemorate two years of operations in Uganda. How are you planning to reward customers who have supported you this far?


We have started the celebrations by offering the most affordable DTT DVB T2 STB ever to be sold in Uganda at only Shs79, 000 with one full month of subscription and includes an external grid antenna.

Nice Times building collapses in Kampala


11 people murdered every day – report


Police block former Buganda Kingdom prime minister J.B Walusimbi from visiting Kayunga.

Police block former Buganda Kingdom prime minister J.B Walusimbi from visiting Kayunga. The action by police sparked off violence in Kampala and other districts in Uganda.

By ANDREW BAGALA
In Summary
Annual Crime Report shows increase in crime, with 100,465 cases recorded in 2012 compared to 99,321 registered in 2011. Defilement, theft of cash, theft of mobile phones and assault top list of reported crimes.

 

KAMPALA
The number of people killed daily in the country has increased from 10 in 2011 to 11 in 2012 as the general crime rate rose by 1 per cent, according to a new report issued by the police.


The Annual Crime and Traffic/Road Safety Report shows that the number of people killed rose from 3,753 in 2011 to 4,161 in 2012, an increase by about 10 per cent.


The Inspector General of Police, General Kale Kayihura, said the developments were cause for worry and needed to be investigated. “I am not happy with the trend of crime. I want a research on why the crime trend has stagnated,” Gen Kayihura said while launching the report yesterday in Kampala.


This is the first time since 2006 that the crime rate has taken an upward trend. At least 273,957 cases were registered of which 100,465 were criminal in nature last year compared to 268,811 cases registered in 2011 of which 99,321 were criminal.


Although there was a significant increase in the cases taken to court, the total number still remained less than 50 per cent.


The report shows that 48,480 cases were taken to court last year compared to 43,813 taken in 2011.
Corruption, defilement, robbery and economic crimes continued to increase.


Gen Kayihura said the increase in corruption cases was a result of vigilance among public servants other than more incidents.


Graft cases up
Police registered 214 corruption cases, which was a 43 per cent increase in 2012 from 150 cases reported in 2011. Economic crimes rose by 15 per cent from 9,574 cases in 2011 to 11,006 in 2012. The report showed a rise of 5 per cent of cases of defilement from 7,690 in 2011 to 8,076 cases in 2012.


Road and traffic safety statistics showed a decline in death on the road from 3,343 people in 2011 to 3,124 last year. Despite increase in police presence in urban areas and highways through the Integrated Highway Patrol System, robbery cases (both simple and aggravated) increased by 0.5 per cent in 2012 from 4,174 in 2011.


At least 236 cases of aggravated robbery of cash, 43 cases of aggravated robbery of motor vehicles and 241 cases of aggravated robbery of motorcycles were registered in 2012. According to the report, these crimes were mostly reported in Jinja, Kampala and Kabale districts.


Aggravated robbery cases involve use of lethal weapons. Another worrying crime trend is the increase of cyber, electronic mobile money fraud crimes where victims have lost billions of shillings to fraudsters.


At least 62 cases were reported where people’s emails were hacked and they lost Shs1.5 billion. Gen Kayihura in the report said Mobile Money Fraud: Between August and November 2012, Shs207m were transferred without authority from telecommunication service providers. He said in the same year, 700 people lost more than Shs1.2 billion by use of scheming devices from ATM locations in Kampala and other areas.


For the first time in more than 10 years, police reduced the traffic accidents by 10 per cent, which they attributed to increased manpower and equipment in the directorate.
Pedestrians and motorcycles are the leading victims of accidents on the road with 1,243 and 571 incidents respectively.


The report stated that the Speed Enforcement Unit was established after getting new speed guns and highway motorised patrols which has contained the road carnage. Police issued penalty tickets worth Shs13.7 billion of which Shs7 billion was paid in 2012.

Facebook to keep ads away from sex and violence


PHOTO | KAREN BLEIER | FILE A woman prepares to log on to the Facebook website on January 26, 2010 in Washington, DC.

PHOTO | KAREN BLEIER | FILE A woman prepares to log on to the Facebook website on January 26, 2010 in Washington, DC.  AFP
By AFP
 
In Summary
  • The move appeared aimed at calming advertisers' concerns about brands being tarnished by appearing on Facebook pages with offensive content

SAN FRANCISCO
Facebook on Monday will tighten its review process to spare advertisers the embarrassment of having their ads pop-up on pages containing pornography or violent imagery.


"Our goal is to both preserve the freedoms of sharing on Facebook but also protect people and brands from certain types of content," the leading social network said Friday in a blog post.


"For example, we will now seek to restrict ads from appearing next to Pages and Groups that contain any violent, graphic or sexual content."


The move appeared aimed at calming advertisers' concerns about brands being tarnished by appearing on Facebook pages with offensive content.


"Prior to this change, a page selling adult products was eligible to have ads appear on its right-hand side; now there will not be ads displayed next to this type of content," Facebook said.


The review process will be manual at first, but in the weeks ahead Facebook will build an automated system to block or remove ads from pages with controversial content.


"We'll do a better job making sure advertising messages appear next to brand-appropriate pages and groups," Facebook promised.

Apple developing iPhones and tablets with bigger screens: report


  A shopper samples a smartphone at a retail shop. Apple could roll out smartphones and tablets with bigger screens in a move analysts say is an attempt to catch up with a trend set by its major rival Samsung July 23, 2013. AFP
A shopper samples a smartphone at a retail shop. Apple could roll out smartphones and tablets with bigger screens in a move analysts say is an attempt to catch up with a trend set by its major rival Samsung July 23, 2013. AFP 
By AFP
 

TAIPEI
Apple could roll out smartphones and tablets with bigger screens in a move analysts say is an attempt to catch up with a trend set by its major rival Samsung.


The Californian tech giant and its Asian suppliers are testing smartphone screens larger than four inches and tablet screens slightly less than 13 inches, the Wall Street Journal reported, without naming the suppliers.


Samsung, which has released a series of handsets and tablets with increasingly larger screens, has seen its global market share rise as consumers flock to their products putting Apple under pressure to follow suit.


The paper said it was not clear if such designs would ever make their way onto the market, but analysts said smartphones with bigger displays are increasingly popular because they meet the needs of users.


"Such designs are understandable as people tend to use their smartphones more for apps than for making calls," Kuo Ming-chi, at the Taipei-based KGI Securities Investment Advisory Co, told AFP.


Currently, the iPhone 5 has a four-inch screen, compared with Samsung's S4, an improved version of the South Korean company's popular predecessor the S3 and which boasts a five-inch screen.


Such handsets are often referred to as "phablets" because their size sits in between a phone and a tablet.


By offering multiple screen size options and handset prices, Samsung has seen its market share rise to 33.1 per cent in the three months to March, while Apple was lagging with 17.9 per cent, according to research by Strategy Analytics.


During the same three-month period, Samsung also witnessed its global tablet market share rise to 17.9 per cent, up from 11.3 per cent a year ago, while Apple's market share dived to 39.6 per cent, a sharp decline from 58.1 per cent the previous year, according to IDC.


While admitting Apple may still defend its argument that smartphones should be designed for one-hand use, Kuo said the continued improvement of battery and processor technologies could lead to re-thinking that policy.


"Bigger displays mean greater consumption of power. But that thinking may change with bigger batteries and improvement of chip manufacturing technologies which have made energy consumption more efficient," he said.


Kuo added Apple might also try bigger screens for its tablet products to meet the demand of users who hope to work on their devices.


"But then again, tablets with bigger screens may be too heavy to carry for some users. That is something Apple may need to find a compromise on," he said.


The current iPad has a 9.7-inch screen while iPad Mini is armed with a 7.9-inch screen.


The Journal cited officials at suppliers as saying that they had started mass producing components for the new iPhone in June, and its assembler Hon Hai Precision Industry Co., to ship the new iPhones in late August.


Hon Hai declined to comment on the report, as did Apple.
But a person familiar with matter told AFP that the shipment of new iPhones may be slightly later than the reported schedule.

Competitors slam Google proposals as 'self-advertising'


PHOTO | KAREN BLEIER | FILE The Google logo on a screen in Washington, DC.

PHOTO | KAREN BLEIER | FILE The Google logo on a screen in Washington, DC.  AFP
By AFP
 
In Summary
  • The European Commission earlier this year launched a consultation process over accusations that Google is unfairly favouring its own services over specialist search engines by giving them greater prominence

BRUSSELS
Google's competitors on Tuesday warned the European Commission that a set of proposals put forward by the US Internet giant to meet EU antitrust rules constituted "self-advertising" and would do nothing to create a level playing field for searches.


"It would be better for the Commission to do nothing than to accept these proposals," said Thomas Vinje, a spokesman for the FairSearch coalition, which includes travel website Tripadvisor and price comparison sites Twenga and Foundem.


The Commission earlier this year launched a consultation process which is due to wrap up on Thursday over accusations that Google is unfairly favouring its own services over specialist search engines by giving them greater prominence.


Google has proposed that its own services could be highlighted in a different way so that users could distinguish them from competitors in full knowledge of the choice before them.


But several companies at a press conference organised by FairSearch said that the proposal would be counter-productive.


"At the end of the day, Google is offering a big ad banner. This is self advertising they are proposing, nothing more, nothing less," said Moritz Von Merveldt from the German audiovisual media company ProSiebenSat1.
Michael Weber, director of Hot Maps, a company that offers online interactive maps, said: "A normal user goes to the biggest and boldest thing on the page".


The European Commission has said it wants to resolve the issue after the summer but EU's Competition Commissioner Joaquin Almunia has already said he would likely ask Google to "further improve its proposals".

SIM cards switch-off cuts Kenya's mobile subscribers to 29.8m


Communications Commission of Kenya director general Francis Wangusi at a past media event. FILE
Communications Commission of Kenya director general Francis Wangusi at a past media event. FILE 
 
 

The switch off of unregistered SIM cards cut the number of Kenya's mobile subscribers to 29.8 million from 30.7 million in the first three months of the year.


The quarterly report released Wednesday covering between January and March this year indicates that Safaricom lost most subscribers (200,071) followed by Airtel (169,237) Orange (7970) and Essar’s yu (1,735) during the period.


The Communication Commission of Kenya (CCK) attributed the decline to the de-activation of 2.4 million unregistered SIM cards during the quarter.


The decline in number of subscribers has affected the country’s mobile penetration rate which fell to 75.8 per cent in the three months to March from 78 per cent in the previous quarter under review.


“Similarly, the total mobile traffic declined by 1.2 per cent to stand at 7.2 billion minutes down from 7.3billion recorded in the previous quarter,” said the CCK quarterly report.


The SIM card registration is aimed at enhancing national security by making it possible to trace details of subscribers engaged in criminal activities such as spreading hate speech, mobile money conmanship, extortion or demanding for ransom in kidnapping cases.


Mobile operators however said the move would led to revenue losses in the short term.


Uptake of mobile money expanded with subscriptions increasing by 10.1 per cent to reach 23.2million. This growth is attributed to the convenience as well as the value-added services of facilitating payments for goods and services.


The number of mobile money transfer agents rose to 74,216 up from 62,300 reported in the previous quarter creating at least 11,916 additional direct jobs in mobile money transfer service during the third quarter.


During the same period, the internet/data market grew to reach 9.6 million subscriptions.


Mobile data/internet subscriptions continued to dominate the market contributing 99 per cent of the total subscriptions. During the quarter, the number of active registered domain names increased by 3.1 per cent to reach 25,764 from 24,983 recorded in the previous quarter.


Broadband subscriptions grew by 17.5 per cent to reach 1.17 million while international internet bandwidth available in the country increased to 921,319 Mbps.


The implementation of the National Broadband Strategy launched recently is expected to accelerate the uptake of broadband in the country.

Polls open in Zimbabwe presidential vote


A Zimbabwean on his way to work  walks pass posters of President Robert Mugabe in Harare on July 30, 2013. Zimbabweans began casting ballots July 31, 2013 in a fiercely contested election dominated by Robert Mugabe's bid to extend his 33-year rule and overshadowed by suspicions of vote rigging. AFP
A Zimbabwean on his way to work walks pass posters of President Robert Mugabe in Harare on July 30, 2013. Zimbabweans began casting ballots July 31, 2013 in a fiercely contested election dominated by Robert Mugabe's bid to extend his 33-year rule and overshadowed by suspicions of vote rigging. AFP 
By AFP



HARARE
Zimbabweans began casting ballots Wednesday in a fiercely contested election dominated by Robert Mugabe's bid to extend his 33-year rule and overshadowed by suspicions of vote rigging.


The 89-year-old president, Africa's oldest leader, is running for election for the seventh and perhaps final time, after a series of violent crackdowns, economic crises and suspect elections.


This time Mugabe vowed to step down if he lost and claimed the army -- long the bulwark of his rule -- would also respect any victory for Morgan Tsvangirai, his perennial rival.
But few are taking him at his word.


Even Tsvangirai, who was forced out of the race in 2008 after 200 of his supporters were killed, told CNN he took Mugabe's promise "with a pinch of salt".


Determined to cast their ballots, voters, some wrapped in blankets on a cold winter morning, started queuing up at least four hours before polling stations opened.


Voting appeared to be brisk in many urban areas, which have traditionally recorded strong support for Tsvangirai.


At polling stations set up in green tents on an open field in Mbare, the capital's oldest township, several hundreds were standing in line.


At Epworth, a Harare township, 66-year-old Ellen Zhakata held back her tears after voting.


"I am happy to have cast my vote. I just want an end to the problems in our country," she said. "All my children are outside the country because of the economic troubles here. I am so lonely. How I wish they could be working here."


Millions of Zimbabwean were forced to migrate to find work elsewhere after an economic crisis which was exacerbated by the violence-marred 2008 elections.


Some 6.4 million people, around half of the population of 12.9 million Zimbabweans, are eligible to vote at 9,670 polling stations across the country.


A candidate needs 50 per cent of the vote to avoid a run-off and both Mugabe and Tsvangirai appear confident they can manage that feat.


Mugabe has focused his campaign on bashing homosexuals and on promises to widen the redistribution of wealth to poor black Zimbabweans.


Amid recovery from an economic crisis that saw mass unemployment and galloping inflation, Mugabe loyalists insist their hero is "tried and tested".


Credible opinion polls are rare, but according to one survey by the US-based Williams firm in March-April, Mugabe could be in for a rough ride.


In a survey of 800 Zimbabweans, 61 per cent said they had a favourable view of the MDC compared with 27 per cent for Mugabe's ZANU-PF.

UN gives rebels 48 hours to leave DR Congo city


  The head of the M23 Congolese rebels, Roger Lumbala, signs documents on February 6, 2013 at a press briefing in Kampala, Uganda. The United Nations on Tuesday gave M23 rebel forces 48 hours to leave the city of Goma in the eastern Democratic Republic of Congo or face "the use of force." Photo/File
The head of the M23 Congolese rebels, Roger Lumbala, signs documents on February 6, 2013 at a press briefing in Kampala, Uganda. The United Nations on Tuesday gave M23 rebel forces 48 hours to leave the city of Goma in the eastern Democratic Republic of Congo or face "the use of force." Photo/File  AFP
In Summary
  • The United States last week called on Rwanda to end its backing of the rebel forces.

The United Nations on Tuesday gave M23 rebel forces 48 hours to leave the city of Goma in the eastern Democratic Republic of Congo or face "the use of force."


A new UN intervention brigade will be used for the first time to help the DR Congo army set up a "security zone" in the city, the UN said.


A statement by the UN mission in DR Congo, MONUSCO, gave M23 rebels in Goma until 4:00pm (2000 GMT) on Thursday "to hand in their weapon to a MONUSCO base" and join a demobilization program.


After then, "they will be considered an imminent threat of physical violence to civilians and MONUSCO will take all necessary measures to disarm them, including by the use of force in accordance with its mandate and rules of engagement."


The UN-proposed security zone includes Goma and its northern suburbs.
The M23 launched a new offensive against the DR Congo army outside Goma on July 14.


"The M23 has used indiscriminate and indirect fire, including by heavy weapons, resulting in civilian casualties," MONUSCO said.


"The M23 has also targeted UN installations with its fire. The security zone will push these indirect fire threats out of range of Goma. The security zone may be expanded and repeated elsewhere, where it is needed."


UN experts and the DR Congo government have said Rwanda has supplied troops and military aid to the M23, allegations denied by Kigali.


The United States last week called on Rwanda to end its backing of the rebel force

Equity Bank’s half-year net profit increases to Sh6bn


  PHOTO | SALATON NJAU Equity Bank Group CEO Dr James Mwangi during the Bank’s half-year results briefing at Equity Centre in Nairobi on July 29, 2013.
PHOTO | SALATON NJAU Equity Bank Group CEO Dr James Mwangi during the Bank’s half-year results briefing at Equity Centre in Nairobi on July 29, 2013. The bank’s net profit increased by 16 per cent.  NATION MEDIA GROUP
By JOSHUA MASINDE

In Summary
  • Company’s income rose by 16 per cent from the Sh5.4 billion it realised in the same period last year, boosted by Kenyan outfit

Equity Bank Group’s net profit for the six months to June rose by 16 per cent despite a slowdown in the performance of its regional subsidiaries.


The bank reported a profit of Sh6.3 billion for the half-year period, up from the Sh5.4 billion realised in the same period last year, boosted by impressive growth in the Kenyan outfit.


Addressing investors in Nairobi on Monday, chief executive officer James Mwangi attributed the growth to a decline in interest expenses which dropped 31.7 per cent to Sh1.7 billion while net interest income went up by about 17 per cent to Sh13.3 billion year on year.


Performance from the regional subsidiaries, however, declined to 8 per cent of total earnings compared to 12 per cent in the first quarter.


This has been attributed to the disruption of oil flow in South Sudan in the last one and a half years and the suspension of donor aid to Uganda and Rwanda on allegations of mismanagement and corruption.


“Slow growth in regional operations was impacted by uncertainty in South Sudan as a result of termination of oil exportation and the suspension of donor budgetary to Uganda and Rwanda,” Mr Mwangi said.
With more than 8 million accounts, the bank has operations in Uganda, Tanzania, South Sudan and Rwanda.


The Kenyan operations recorded a 21 per cent growth in the period under review, further putting into focus the bank’s strategy in the regional markets where its model of targeting the low income segment of the market seemed not to have worked the way it has in Kenya.


A Citi research released in October last year said the bank has had a poor track record in its East African operations where it had injected Sh7.9 billion in investments since 2008 but is yet to realise significant returns.


No significant gains
Uganda got Sh4.9 billion, about 62 per cent of the total investment, but no significant gains have been realised from the subsidiary.
Last year, the contribution from the bank’s regional subsidiaries stood at about 17 per cent. 


Going forward, Mr Mwangi said the bank will focus on long term growth through deepening its agency banking model, continued partnership with global payments companies to enhance electronic payments and emphasis on banking the small and medium enterprises.


Currently, the bank has 7,632 agents compared to the 875 it had in 2011. It has also partnered with different electronic cards payment providers including MasterCard, PayPal, Visa, American Express, UnionPay and technology firm, Google to enhance use of cards in purchasing goods and services.


“The bank is well positioned through strategic partnerships to take advantage of the significant volume of mobile and merchant payments,” Mr Mwangi noted.

NSSF barred from awarding tenders as projects face audit


  Labour secretary Kazungu Kambi and other officials during the commissioning of construction work of Hazina Trade Centre. In a statement sent to media houses Tuesday, Mr Kazungu said the government will float the tenders for the affected projects afresh. PHOTO/FILE
Labour secretary Kazungu Kambi and other officials during the commissioning of construction work of Hazina Trade Centre. In a statement sent to media houses Tuesday, Mr Kazungu said the government will float the tenders for the affected projects afresh. PHOTO/FILE 
By MWANIKI WAHOME

In Summary
  • The projects to be affected by the new orders are the Sh6.7 billion construction work at the Hazina Trade Centre, currently hosting Nakumatt Lifestyle Supermarket, the extension of the parking lot at the NSSF building and development of 100 flats at Nairobi, Milimani.

The government has stopped the National Social Security Fund from awarding any new contracts and ordered an audit on the on-going projects barely a week after the sacking of the managing trustee.


In a statement sent to media houses Tuesday, Labour and Social Security Cabinet Secretary Kazungu Kambi said the government will float the tenders for the affected projects afresh.


“Following the recent sacking of Tom Odongo as managing trustee of NSSF, the government has cancelled all projects that were tendered but not yet awarded or started. The projects will be tendered afresh. Further, that all projects awarded and on-going will be subjected to a comprehensive audit by Efficiency Monitoring Unit,” Mr Kambi noted.


The projects to be affected by the new orders are the Sh6.7 billion construction work at the Hazina Trade Centre, currently hosting Nakumatt Lifestyle Supermarket, the extension of the parking lot at the NSSF building and development of 100 flats at Nairobi, Milimani.


Others are the construction of phase six of Nyayo-Embakasi housing and shopping malls.


Mr Odongo was sacked through a gazette notice of July 22, and ordered to hand over to the corporate secretary, Ms Hope Mwashumbe, who is holding the post in an acting capacity.


No reasons were given for the sacking of Mr Odongo who last week moved to court to challenge the decision.


Mr Kambi told Mr Odongo to hand-over the Fund’s goods as he waits to be paid severance allowances.
Mr Odongo was confirmed the managing trustee in November last year after holding the seat on an acting capacity for some time.
He was expected to serve for a term of three years.


Several weeks ago, a meeting between Cotu and Deputy President William Ruto resolved that the NSSF together with the National Hospital Insurance Fund would be reformed to improve efficiency in delivery of services.

EABL says net profit may drop by 25pc


Workers at  the EABL plant line in Ruaraka, Nairobi . The company has issued a profit warning citing high financing cost and low income.

Workers at the EABL plant line in Ruaraka, Nairobi . The company has issued a profit warning citing high financing cost and low income.  
By NATION CORRESPONDENT
 
In Summary
  • Mr Eric Musau, a market analyst with Standard Investment Bank said the profit decline could be higher than 30 per cent due to high finance costs.

East African Breweries has issued a profit warning citing high financing cost and low income.
In a statement sent to media houses and to investors, the brewer says it expects net profits for the 12 months through to June 30 to drop by more than 25 per cent compared to last financial year.


The high finance costs were incurred in servicing the Sh19.5 billion it borrowed from its parent company, Diageo in November 2011 to acquire SAB Miller’s 20 per cent stake in Kenya Breweries.


“The interest charges for the year ended 30th June 2013 cover a full year (twelve) months of trading compared to the borrowing for the year ended 30th June 2012, which only reflects seven months,” management said of the anticipated drop in earnings.


Sale of stake
Last year, the brewer earned Sh3.6 billion in a one-off transaction from the sale of a 20 per cent stake in Tanzania to Tanzania Breweries Ltd.


The warning was issued in line with market regulations which require a listed company to inform the market when net income falls below 25 per cent.


The effect of the announcement will be known today, as investors reacts to the news. Tuesday, the counter recovered after trading on a four-year low on Monday in what analyst termed as due to “active foreign investor participation on the counter.”


Mr Eric Musau, a market analyst with Standard Investment Bank said the profit decline could be higher than 30 per cent due to high finance costs.


He said the decline could be slightly due to weaker volumes and largely because of the high finance costs.

Insurers in bid to block 10pc tax on their services


  Association of Kenya Insurers (AKI) chairman Mark Obuya (left) and executive director Tom Gichuhi (right) with Insurance Regulatory Authority chief executive Sammy Makove at the launch of AKI Market Report last August in Nairobi. The insurance industry has moved to court to block the taxman from levying a 10 per cent exercise duty on their services. Photo/File
Association of Kenya Insurers (AKI) chairman Mark Obuya (left) and executive director Tom Gichuhi (right) with Insurance Regulatory Authority chief executive Sammy Makove at the launch of AKI Market Report last August in Nairobi. The insurance industry has moved to court to block the taxman from levying a 10 per cent exercise duty on their services. Photo/File 
In Summary
  • Tuesday, however, the industry’s lobby, Association of Kenya Insurers (AKI), obtained a temporary injunction blocking the Commissioner of Domestic Taxes and KRA from collecting the tax

The insurance industry has moved to court to block the taxman from levying a 10 per cent exercise duty on their services.


Under the proposed Finance Bill, 2013, the government brought the insurance firms into the bracket of financial institutions whose services are to be levied the 10 per cent duty to help the Kenya Revenue Authority raise Sh973 billion.


Tuesday, however, the industry’s lobby, Association of Kenya Insurers (AKI), obtained a temporary injunction blocking the Commissioner of Domestic Taxes and KRA from collecting the tax.


“Therefore for the time being neither the Commissioner nor KRA can collect payment from insurers until the matter in court is heard and determined,” read a circular signed by AKI’s executive director Tom Gichuhi and directed to all industry players.


KRA had announced it expected banks and insurance companies to remit excise taxes on July 20, 2013 for the period between June 18 and 30.


Affected parties
Parties affected by the Bill are banks, co-operative societies, insurance companies, mobile money transfers and Saccos.


Kenya Bankers’ Association (KBA) was the first group that sought a court redress over the proposed Bill.
Earlier this month, it asked the National Assembly Committee on Finance, Planning and Trade to allow members levy the excise duty from August 1instead of June 18.


“Computer software used by banks is not capable of calculating or charging excise duty in its current state.
In some cases, we will not be able to introduce the new tax system immediately,” KBA chairman Jeremy Awori had said when he met the committee.

The lobby group had carried out consultations with the Kenya Revenue Authority and the Central Bank of Kenya who agreed to the proposed plan of implementation

Insurers in bid to block 10pc tax on their services


Association of Kenya Insurers (AKI) chairman Mark Obuya (left) and executive director Tom Gichuhi (right) with Insurance Regulatory Authority chief executive Sammy Makove at the launch of AKI Market Report last August in Nairobi. The insurance industry has moved to court to block the taxman from levying a 10 per cent exercise duty on their services. Photo/File

Association of Kenya Insurers (AKI) chairman Mark Obuya (left) and executive director Tom Gichuhi (right) with Insurance Regulatory Authority chief executive Sammy Makove at the launch of AKI Market Report last August in Nairobi. The insurance industry has moved to court to block the taxman from levying a 10 per cent exercise duty on their services. Photo/File 

In Summary
  • Tuesday, however, the industry’s lobby, Association of Kenya Insurers (AKI), obtained a temporary injunction blocking the Commissioner of Domestic Taxes and KRA from collecting the tax.


The insurance industry has moved to court to block the taxman from levying a 10 per cent exercise duty on their services.


Under the proposed Finance Bill, 2013, the government brought the insurance firms into the bracket of financial institutions whose services are to be levied the 10 per cent duty to help the Kenya Revenue Authority raise Sh973 billion.


Tuesday, however, the industry’s lobby, Association of Kenya Insurers (AKI), obtained a temporary injunction blocking the Commissioner of Domestic Taxes and KRA from collecting the tax.


“Therefore for the time being neither the Commissioner nor KRA can collect payment from insurers until the matter in court is heard and determined,” read a circular signed by AKI’s executive director Tom Gichuhi and directed to all industry players.


KRA had announced it expected banks and insurance companies to remit excise taxes on July 20, 2013 for the period between June 18 and 30.


Affected parties
Parties affected by the Bill are banks, co-operative societies, insurance companies, mobile money transfers and Saccos.


Kenya Bankers’ Association (KBA) was the first group that sought a court redress over the proposed Bill.
Earlier this month, it asked the National Assembly Committee on Finance, Planning and Trade to allow members levy the excise duty from August 1instead of June 18.


“Computer software used by banks is not capable of calculating or charging excise duty in its current state.
In some cases, we will not be able to introduce the new tax system immediately,” KBA chairman Jeremy Awori had said when he met the committee.


The lobby group had carried out consultations with the Kenya Revenue Authority and the Central Bank of Kenya who agreed to the proposed plan of implementation.

Airtel Equity sign deal


  An Airtel shop. The deal between the two companies allows their customers to carry out  money transactions on each other’s platforms locally and in the continent.
An Airtel shop. The deal between the two companies allows their customers to carry out money transactions on each other’s platforms locally and in the continent.  NATION MEDIA GROUP
By JOSHUA MASINDE

In Summary
  • Equity has already integrated its money transfer and transaction platform with the payment platforms of other mobile phone operators including Safaricom, yuCash and Orange

A new partnership between mobile phone firm Airtel and Equity Bank is expected to intensify competition in mobile money services.


The deal between the two companies allows their customers to carry out money transactions on each other’s platforms locally and in the continent.


“We have taken a continental approach in this arrangement so we will move from one country to another where we both have a presence to facilitate regional money transfer from in-country transfers on each other’s platforms,” said Equity Bank chief executive officer James Mwangi during the signing of the agreement Tuesday.


Airtel will be seeking to tap into Equity’s wide network in the financial sector to grow its mobile money service while the bank will use Airtel’s technology to drive its mobile banking services.
Currently, the bank has 7,632 agents who will work together with those of Airtel Money who are 10,000 countrywide.


Negotiations on the deal started several years ago. The partnership also allows mobile phone provider, which operates in 17 countries, to take advantage of Equity Bank’s more than 8 million customers to grow its operations.


“This partnership marks another milestone in deepening of Airtel Money to our customers throughout Kenya,” said Airtel Africa chief executive officer Mr Jayant Kholsa.


Equity has already integrated its money transfer and transaction platform with the payment platforms of other mobile phone operators including Safaricom, yuCash and Orange.


The bank plans to do the same in the region where it has a presence, a move that is set to speed up the inter-operability of money transactions across the mobile phone operators.


“By putting all these four telecommunication companies to work in Kenya, we are moving slowly away from closed systems and we are hoping eventually there will be a perfect interoperability amongst the telecoms,” Mr Mwangi said.


In 2010, the bank partnered with Safaricom to launch M-Kesho, a service that could allow customers of both firms to make savings, access credit and conduct transactions across each other’s service agents or platforms.


The product, however, seems to have failed to take off and has instead been replaced by M-Shwari, another product of a similar nature offered jointly by Safaricom and Commercial Bank of Africa.

High fuel, housing prices sees inflation hit 6pc


 CBK headquarters in Nairobi. Clearing of all cheques will be taking a day beginning mid next month, the Central Bank of Kenya has announced. File
CBK headquarters in Nairobi. Clearing of all cheques will be taking a day beginning mid next month, the Central Bank of Kenya has announced. File
 
By IMMACULATE KARAMBU 
 

The overall rate of inflation rose for the second consecutive month in July on account of increasing prices of fuel and housing.


According to data released by the Kenya National Bureau of Statistics (KNBS) on Wednesday, the rate of inflation stood at 6.02 per cent in July, up from 4.91 per cent in June.


“Housing, water, electricity, gas and other fuels’ index rose by 0.3 per cent between June and July, 2013, mainly due to increases in house rent and charcoal,” said KNBS in statement.


During the period under review, the cost of transport increased by 0.98 per cent, which KNBS attributes to increases in the pump prices of petrol and diesel by the Energy Regulatory Commission (ERC) during its last fuel price review.


On July 14, ERC announced a Sh1.34 and Sh3.70 increase per litre in the pump price of super petrol and diesel respectively in Nairobi, while allowing a Sh2.03 decrease per litre of kerosene.


The result of this, according to KNBS was a rise in public transport fares that pushed the transport index up during the month.


In July, the cost of healthcare also went up by 0.95 per cent due to increases in doctor’s charges and the price of medicine