Business Snapshot: Top Insights

Insightful Reads to Spark Your Business Growth

Explore this week’s top business stories—a curated blend of business, economy, leadership, and innovation to inspire your weekend reading.

Parastatals outpace others in lending to government securities

Parastatals in Kenya raised their government securities investments by 18.4% to KSh328.65 billion from June to December 2024, outpacing other investors.

• Parastatals are strategically shifting surplus funds into low-risk assets to boost stability and returns.
• The trend may indicate government influence, encouraging parastatals to support fiscal needs through increased lending.

?Distrust in public institutions widens on governance woes

An Afrobarometer survey shows trust in Kenyan public institutions has fallen to 47%, with low confidence in the Judiciary, police, presidency, and Parliament due to corruption and inefficiency.

• Low trust in state institutions highlights governance issues that weaken public confidence and policy execution.
• Higher trust in non-political entities reflects a societal shift toward seeking stability outside government structures.

Kenyan firms turn to cryptos for foreign supplier payments

Kenyan firms are turning to cryptocurrencies, especially stablecoins like USDT, to pay foreign suppliers amid dollar shortages and a weakening shilling.

• Using stablecoins helps firms manage currency volatility and liquidity issues, offering an alternative financial solution.
• The rise in crypto usage highlights the urgent need for regulation to ensure secure, transparent transactions.

Ruto, Kindiki offices seek Sh1.6bn for renovations

The Kenyan government plans to spend KSh1.6 billion on renovating key offices, including those of President Ruto and CS Kindiki, despite ongoing austerity measures.

• High renovation costs during austerity may spark concerns about spending priorities.
• Renovations could improve government infrastructure and boost long-term efficiency.

Treasury to spend Sh1.8bn on crafting crypto laws

Kenya’s Treasury will spend KSh1.82 billion to develop and publicize crypto regulations, aiming to curb tax evasion, fraud, and cybercrime while aligning with global standards.

• The budget shows the government’s focus on creating a legal framework to safeguard financial integrity and protect consumers.
• A collaborative regulatory process aims to balance innovation with risk mitigation in the fast-growing crypto sector.

The IMF has urged Kenya’s Capital Markets Authority (CMA) to set clear rules for cryptocurrency innovations in its regulatory sandbox to balance innovation and investor protection.

The IMF emphasizes the need for proactive regulations to manage crypto risks while fostering innovation. Clear guidelines could boost investor confidence and attract fintech startups, strengthening Kenya’s capital markets.

Let the January festivities start

Professionals in high-demand sectors often delay vacations until January, when workloads decrease, allowing for more relaxed family time.

• January vacations offer benefits like fewer crowds, lower costs, and a calmer experience.
• Flexible scheduling helps employees in busy sectors take meaningful breaks and maintain work-life balance.

?Currency in circulation up 6pc as Kenyans liquidate savings

Currency in circulation rose 6% to KSh285.5 billion in December 2024 as Kenyans liquidated savings to meet year-end expenses, reflecting financial strain and a shift to cash holdings.

• Rising cash use shows economic pressure, with households withdrawing savings to cover expenses.
• The move from deposits to cash signals a need for liquidity or declining trust in banks, posing potential financial risks.

Jumia to cut logistics cost of orders with EVs

Jumia plans to introduce electric vehicles in its delivery fleet to cut logistics costs and boost efficiency, supporting sustainability goals.

• Using EVs lowers costs, potentially enabling better pricing and customer satisfaction.
• Jumia’s shift to EVs highlights a growing trend toward sustainability in Kenyan businesses.

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