Category Archives: Kenyaelection07

Urban inflation index

back to normal

Compared to a year ago

This shows that not much changed for those in Nairobi able to travel around and shop properly at Uchumi that life is pretty normal as far as shopping is concerned.

Litre of petrol: 87.99 shillings (~$5.50 a gallon) and up 18% from a year ago (then 74.29) when you drive around Nairobi you can get prices from about 85 to 92 this week For petrol prices, I have been tracking a brand name station that tends to have slightly lower prices than may parts of the city where the price is at around 91 shillings. And these are expected to go up this year as are electricity bills which are already being billed at 12% higher for residential house. Energy Minister Kiraitu Murungi sounded out another warning yesterday to petrol companies to adjust the prices downwards when international oil prices drop – but the companies have, over the years ignored previous warnings from Ministers and government officials, and not passed on any savings to motorists.

Maize meal ugali (2 kg. unga) 52 shillings (50 a year ago)

Sugar (2 kg. Mumias pack) 150 shillings (no change from a year ago)
Fresh food prices have gone up also. Milk and bread have increased by a few shillings depending on where you shop. The prices of vegetables have gone up, some even up to 4X what they were before the election, but vegetable prices are seasonal and once supplies and fresh harvest kick in, the prices should adjust downwards.

Tusker beer: 120 shillings at local pub – up 20% (from 100 a year ago)
some pubs experienced shortages in the post-election period until the only beer they were left with was Guinness

(Safaricom) Mobile phone promotion: a year ago Safaricom had introduced Saasa – with 8 shillings per minute calls during off peak hours. This year they have extended the hours that off-peak applies, while rival Celtel has lowered the bar with 4 shilling per minute calls to 3 preferred numbers
What i really want from mobile company is for one tariff to focus on cheap data charges – SMS, Internet browsing – while voice can remain expensive

US Dollar exchange rate: 70.7 shilling to the dollar – unchanged (was 69.97 a year ago). But this is abnormal as it does not capture the the strength of the Kenya shilling which had appreciated to about 63 just before the election – from December it has lost 10% against the dollar and 17% against the Euro (overall it is 15% weaker against the Euro a year ago.

New month, new hopes

seeking bloggers: Mediation talks are going on in Nairobi, and we hope for a better month than January. The last post I did was on winners – one of whom was Kenyans online who have been inspired by the political crisis to start blogging. I’d like to add new bloggers to the blog roll (the list on the right, below the advertisements) – an update of the list is long overdue and some blogs there have since become dormant. Regular readers are invited to submit any interesting blogs they have found (and which are likely to be running for the next few months at least) and I may do a write up of them

Other opportunities
most from the daily papers this week

TED Africa registration opens today

Import finance: the Government of Japan has through Kenya’s ministry of finance come forward with a 1.5 billion yen (884 million shillings) facility for Kenyan businesses to import raw materials and finished goods from Japan. Applications are on a first come, first served basis, minimum amount is 5 million shillings, maximum 40 million ($560,000) ; terms are down payment of 10% and finance is up to 90% to be repaid over 1 year and secured by a bank guaranteed. Info is from crown agents (crownagents@ke.crownagents.com)

Ford foundation scholarships: The 7th round of the Ford foundation international fellowships program is up and running. 48 scholarships are available to Kenyans – details online and D/L is 7/3
Jobs
– Credit analysts at Africa trade insurance company
Consolidated bank: branch manager, credit manager, credit admin manager, credit analysts. Apply though snail mail by 15/2
– Regional learning & development coordinator at Deloitte. Apply to hr@deloitte.co.ke
KCB: divisional director HR – apply through hawking associates by 11/2. Also investigators (frauds-forensics) and head of central services. Apply to recruitment@kcb.co.ke by 8/2
Kenya Airways: Ramp Bus Operator,
Sales & Ticketing Agent, Multilingual In-Flight Attendant, Customer Service Agent, Qualified Pilots
Nimble Africa: industry experts (hospitality, financial, retail). Apply to recruitment@nimbleafrica.com by 10/2
Safaricom: Area sales representative, M-PESA new business sales officer. D/L is 6/2
Standard group: financial & commercial services director, group managing editor. Apply through PWC at ess.ke@ke.pwc.com by 15/2.
USIU; management accountant, financial accountant. Apply to jobs@usiu.ac.ke by 15/2
– Independent financial advisors at Winton investments: Apply to jobs@wintoninvestments.com.

Issues for Diaspora Investors

Unit trusts
In all the political news this week, some may have missed this story on collective investment schemes (funds, unit trust), who will now have to get more aggressive (take on more risk) to deliver commensurate returns – and are now asking the regulator (CMA) to relax some of the rules that restrict their investments.

A year ago this post discussed unit trusts and the cost of investment being a major deterrent to the returns they offer (and at the time the NSE was in a much better position). I still have issues with the 3 – 5% initial fee and 2% annual fee charged by many unit trusts.

Real estate
The post-election violence will have a mostly negative impact on property values and in rural Kenya, and in towns like Eldoret, Kisumu, Nakuru and especially in Mombasa (where the real estate boom was driven by visitors/tourism numbers). The cost of building will also go up as demand for supplies will be great. So buy cement company shares (Bamburi, ARM, Portland) the day Kofi Annan succeeds in his mediation efforts

In Nairobi, properties near slums like Ayany (adjacent to Kibera) have been badly affected owners and/or tenants moving out. However there is also increased demand in some of the same areas – perceived to be safer parts of the city, such as Kileleshwa and Westlands. They will also benefit from residents of other towns like Kisumu relocating to Nairobi.

These are also the areas that many Diaspora Kenyans have invested in or are considering investing; and while many have postponed their real estate investment decisions, those already in (with mortgages to pay) will have to wait out the storm. Also it may be wise to set up several investment companies to keep rental turnover and sidestep new tax laws

Also Kasarani which is one place you can still buy land cheaply to build, will have values of land increasing as will parts of Central Kenya.

Kutwa: Tuesday: Pick out a positive story

Bank Round-up
Co-op Bank extends its banking hours from the now less-traditional 9 to 3 to 9 a.m. to 4. p.m. daily and up to noon on Saturdays.

bold Equity Bank announced plans last week to open new branches in Kisumu, but that was before a new outbreak of violence over the weekend and the fatal shooting of an opposition MP this morning.

– The Business Daily reports that West African giant Ecobank, plans to take over a majority stake in limping mortgage bank EABS whose recent growth had lagged most of its peers

NIC Bank to convert this cashless ATM points into full branches and expand its network.

capital flight: A leading multi-national bank is considering moving an African operations department out of Nairobi, and to another country. The amount of capital flight (money leaving the country) is also at an alarming high.

Other sectors
Valentine’s day massacre?; What does Naivasha flare up mean for some flower farms who Valentine’s Day (Feb 14) shipment/sales can account for up to ½ their turnover in a year ?
– Nairumor that a blue chip CEO and turnaround specialist will resign next month in search of (foreign) greener pastures
– The Harvard Business School’s Africa Business Conference is on February 15-17, 2008 in Boston MA. Details from YAP
– Some troubling signs and even more today.
– Another regional airline upstart is Executive Turbine, flying 4X weekly to Kisumu for Kshs. 3,540 ($70). Regional airlines should be added to the earlier post on election winners.

Trivia
Will ‘President Obama’ need Equity Bank? – because 46% of African American household’s don’t have bank accounts – he can tap Equity Bank’s revolutionary model to bring banking to the unbanked.

wish I was in France: It’s better to be a rogue trader facing charges for misplacing $7 billion. But it’s also a reminder that financial shenanigans are still rarely punished and prosecuted in Kenya. E.g. Francis Thuo. (and maybe Mr. Kerviel would rather have worked for a Kenyan bank instead)

Post-election Winners

(Non political) : For a month, we have concentrated on the losers – Kenya’s image, banks, truth, profits, employees, tourism sector, insurers, economy; so it’s a good time to look at some ‘winners’ today – people, concepts, companies who proved themselves and who may make some money from the post-election turmoil.

Mobile phone companies – Safaricom and Celtel were a vital link throughout the country. Airtime was worth more than money at times.
Language schools: Why? Cause you never know when it will be an advantage to multi-lingual in our multi-tribal Kenya again.
NGO’s: Are back in business in a big way.
Dick Morris: He never had a chance to participate in the election, but his ilk i.e. dirty tricks campaign managers were at work and in full force such that many professionals who ran clean, issue-oriented campaigns rarely had a chance in this election.
Gated community housing projects.
Uchumi Supermarkets: Won a lot of points for being open and doing business even when urban clashes were at outide their doors. Investors can expect no dividends until 2011, but the company may get a better reception if they approach investors with another rights issue thsi year.
Kenyans online: From blogs, to online initiatives (reporting violence, airtime/voucher transfer) thousands turned online to vent, tell their stories, get news, correct their country’s image and restore sanity – after a media blackout and/or fatigue from the political bickering and violent images that ran on TV all day.

Can you name any other winners?