Introducing the Second Edition of the Fintech Association of Kenya Weekly Newsletter!
Global Macroeconomic Trends:
World: Global Price Watch: August 2023 Prices (September 30, 2023)
In East Africa, maize prices declined seasonally in most key reference markets in Kenya, Uganda, Somalia, and parts of South Sudan due to increased supply from the June-to-August harvest, whereas prices increased seasonally across most markets in Tanzania, Sudan, parts of South Sudan, Ethiopia, and Burundi as supplies tightened. Food prices remained above average in most countries because of persistent local currency depreciation, supported in some countries by conflict-related disruptions.
What is ‘global debt’ - and how high is it now?
Global debt has already hit a record $307 trillion in 2023, the Institute of International Finance says.
This covers borrowing by governments, businesses and households.
While recession concerns have eased in some quarters, 6 out of 10 chief economists expect the global economy to weaken this year, according to the World Economic Forum's latest Chief Economists Outlook.
The sudden rise in inflation has pushed global debt to new highs.
In the second quarter of 2023, global debt was recorded as $307 trillion, largely driven by developed countries like the US, Japan, the UK, and France.
So what is global debt, and why does it matter?
Read more on the link below.
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Finance in Africa: Uncertain times, resilient banks: African finance at a crossroads
The Finance in Africa report emphasises the challenges faced by the African banking sector — including the impact of recent shocks, such as the COVID-19 crisis and Russia’s invasion of Ukraine — and the importance of gender diversity in business and banking. The report also discusses the need for international support and sustainable finance to advance economic development and climate change in Africa. It provides insights into the financial conditions, banking sector performance, and investment trends in the region. It covers the nature of climate finance flows in Africa and the degree of climate risk on bank balance sheets. With the right measures in place, Africa has the potential to overcome its challenges and unlock its true economic potential.
How to Calculate Trade Balance
Trade balance, also known as net exports, is the difference between a country's total exports and imports. It is an important economic indicator that reflects a country's international trade standing.
To calculate trade balance, follow these steps:
Gather data on a country's total exports and imports within a specific timeframe, usually annually or quarterly. This data can be found from national statistical agencies, international organizations like the World Bank, and reliable data platforms such as globalEDGE.
Determine the value of exports by identifying the monetary value of all goods and services that are shipped or provided by domestic producers to foreign consumers during the chosen period. Only include goods and services that cross international borders.
Determine the value of imports by identifying the monetary value of all goods and services purchased by domestic consumers from foreign producers during the given period. This figure should include not only tangible items but also intangible offerings such as intellectual property and licensing agreements.
Subtract imports from exports to get the trade balance:
Trade balance = Total exports – Total imports
How do we ensure a fair future for global trade?
Podcast: Calling for the "reglobalization" of trade: WTO chief Ngozi Okonjo-Iweala
In a recent conversation on the GZERO World podcast, Ian Bremmer sat down with World Trade Organization Director General Ngozi Okonjo-Iweala, the first woman and first person from Africa to lead the organization. They discussed the good, the bad, and the future of global trade.
Globalization has dramatically increased economic output, created hundreds of millions of jobs, and lifted millions of people out of poverty in the last half century. However, development between countries has been uneven, and global inequality is on the rise. Covid-19 and the war in Ukraine have exposed weaknesses in the supply chain, and rising tension between the US and China has led to a world economy that is becoming increasingly fractured.
Okonjo-Iweala believes that the way out of this crisis is not less trade, but more. She argues that we need to make sure that the future of trade is fair to countries in the Global South, who are reeling from runaway debt and bearing the brunt of climate change.
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The Hidden Costs of Political Instability on Free Trade Agreement
The occurrences of coups bear significant ramifications for free trade agreements. When coups occur, they send shockwaves through these agreements, affecting economies, trade partners, and regional stability. Nations, particularly surrounding countries, typically scramble to protect their national security by implementing security-driven measures such as border closures and trade limitations. These measures hinder the movement of goods and disrupt the supply chain of several commodities. Such outcomes promote economic uncertainty and trigger shifts in regional and global trade dynamics.
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Kenya to Trade Freely with Other African Countries Using PAPSS
Kenyan Cabinet Secretary for Trade and Investment Moses Kuria has announced that Kenya will now trade freely with other African member states of the Pan Africa Payments and Settlement System (PAPSS). This follows Kenya's signing on to become a signatory to the monetary body.
The move is expected to lock out the dollar as a medium of payment within African states. It is also expected to ease trade and financial transactions between Kenya and the countries signatory to PAPSS.
In a post shared on his X app account, Kuria said that Kenyan companies will now be able to carry out business transactions without necessarily using external currencies as their medium of exchange.
PAPSS is a payment system that allows African countries to trade with each other using their own currencies. It is a pan-African initiative that was launched in January 2022.
The system is backed by the African Union and the African Export-Import Bank (Afreximbank). It is designed to reduce the cost of trade between African countries and to promote financial integration on the continent.
Kenya's decision to join PAPSS is a significant step towards boosting intra-African trade. It is also a sign of the country's commitment to financial integration on the continent.
Read more: https://tinyurl.com/27emm8pv
Emerging Technologies & Fintech
Kenya panel urges shutdown of Worldcoin's crypto project within country
A Kenyan parliamentary panel called on the country's information technology regulator on Monday to shut down the operations of cryptocurrency project Worldcoin within the country until more stringent regulations are put in place.
The government suspended the project in early August following privacy objections over its scanning of users' irises in exchange for a digital ID to create a new "identity and financial network".
VISA’s Strategic Approach to Combatting Digital Payment Fraud in Sub-Saharan Africa??
Security is everyone's responsibility. Visa is investing in cutting-edge technologies to protect against fraud, but consumers also need to be aware of the risks and take steps to protect themselves.
Visa is working to educate consumers about scams and to promote robust cybersecurity legislation. We also need to ensure that technology is developed with security in mind.
In the end, the best way to protect ourselves from fraud is to be vigilant and to think critically about the information we receive.
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What Is Fiat Currency? How Does It Differ From Cryptocurrency?
What is fiat currency?
Fiat currency is money that is not backed by a physical commodity, such as gold or silver. Instead, its value is based on the trust and authority of the government that issues it.
How does it work?
The government controls the supply of fiat currency by printing more or less of it. This affects the value of the currency, as well as the price of goods and services.Latam Fintech Giant EBANX Expands Its Payments Solutions to Africa
How AI can shape a brighter future for Africa
Artificial intelligence (AI) is rapidly transforming the world, and Africa is no exception. AI has the potential to benefit Africa in many ways, from improving healthcare and agriculture to enhancing education and finance.
In this episode of the podcast Africa Science Focus, Barbara Glover, programme officer at the African Union Panel on Emerging Technologies,speaks about the potential of AI to benefit Africa, as well as the possible pitfalls.
African Economies and Integration:
AfCFTA to boost remittances by making cross-border transactions cheaper
The African Continental Free Trade Area (AfCFTA) has potential to increase cross-border remittances by migrants, according to a new report by World Bank, even as international markets remain the largest sources.
The AfCFTA has the potential to make cross-border transactions such as remittance transfers by migrants within Africa cheaper through the Pan-African Payment and Settlement System (PAPSS), the World Bank says. The new report comes as market projections indicate a possible slowdown in the growth of remittances to Sub-Saharan Africa that are expected to fall from 6.1% in 2022 to 1.3% in 2023 but recover again in 2024.
High on G20 bonhomie, India readies 4th summit with African Union
Delayed for 5 years, the key meet likely in Nairobi in three months
Keen to capitalise on the growing geopolitical support from African nations after the recently concluded G20 Summit, India is working with the African Union to hold the fourth India-Africa Forum Summit later this year in Kenya’s Nairobi, sources said.
Prime Minister Narendra Modi is expected to attend the mega meet along with as many as 50 African leaders, they added.
Fashion and Arts Stakeholders Call for Improved Intra-African Trade and Support for Creatives
Stakeholders in the African fashion and arts industry have called for improved intra-African trade and business relationships amongst entrepreneurs in the sector. They have also emphasized the need for fashion and art creatives to be empowered, rewarded, and celebrated.
This call comes as the African Fashion & Arts Award (AFAA) gears up to celebrate the continent's creative talents. Founder and President of AFAA, Mr. Kingsley Amako, noted that over 65% of the African 1.4 billion population is made up of youths between the creative ages of 12-35 years. He also highlighted that fashion and arts remain the most viable and potentially the creative industry vertical generating the most revenue enough to effect a significant change on the continent's GDP.
Improved intra-African trade and stronger business relationships between entrepreneurs in the fashion and arts industries on the continent would be a boon for the sector. It would enable creatives to reach a wider audience and generate more revenue. Additionally, it would help to promote African culture and heritage on the global stage.
Read more:https://tribuneonlineng.com/stakeholders-call-for-improved-intra-african-trade-in-fashion-industry/
Regulatory Innovations & Best Practices:
Central bank digital currencies: What they mean for financial inclusion and private sector banks
As of June 2023, 11 countries or their currency unions had fully launched digital currencies, 21 had embarked on pilots, 32 had them under development and another 46 were at earlier stages of researching them. Some initiatives are exclusively for retail CBDCs (including the 11 already launched), some for exclusively wholesale ones, and several large economies (such as China[1], the US, and the Eurozone) are exploring the launch of both.
Apple Is Piloting Open Banking in the UK
Apple is testing out a new feature for UK Apple Wallet users, allowing them to view their current bank account balance and transaction history directly within the app.
The tech giant is leveraging UK’s Open Banking API to fuel the effort, and according to 9 to 5 Mac, the feature will be available to a select group of Wallet users who have linked their Apple Pay card with one of the participating banks, which include Barclays, HSBC, Lloyds, RBS, Monzo, and Starling.
Open Banking: A New Era of Financial Innovation
Open banking is a financial technology that allows customers to share their financial data with third-party providers, known as fintechs, through secure APIs. This enables fintechs to develop new and innovative products and services that are tailored to the individual needs of customers.
Open banking is still in its early stages of development, but it is rapidly gaining traction around the world. In the United Kingdom, for example, over 6 million people are now using open banking-powered services.
Open banking has a number of potential benefits for businesses, customers, and banks.
Benefits for businesses
Benefits for customers
Benefits for banks
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Read more: https://www.globalbankingandfinance.com/open-banking-shaping-the-future-of-fintech-and-finance/
ESG Investment:
African Development Bank Launches Country Reports on Climate Finance
Ahead of the 28th United Nations Conference on Climate Change (COP 28), the African Development Bank Group has launched country-by-country economic reports to guide African policymakers in their discussions on mobilizing private sector finance for climate and green growth in Africa.
The new Country Focus Reports (CFRs) provide analysis and policy recommendations to strengthen countries' active participation at COP 28, which takes place in Dubai, United Arab Emirates, from 30 November to 12 December.
The reports foster policy dialogue on macroeconomic performance and outlook and provide insights on mobilizing private sector and natural capital finance to drive the continent's climate resilience and green growth policies.
TotalEnergies faces lawsuit in France for 'damaging environment, climate' in Africa
Environmental organizations file criminal complaint against French energy giant for fueling climate change through oil extraction activities in Uganda, Tanzania.
Funding for African tech startups continues to fall as global climate bites hard
African tech startups raised US$492,418,000 in Q3 2023, taking the total for the first nine months of the year to US$1.4 billion, down 48 per cent on the corresponding period in 2022 as the global capital crunch continues to impact the continent’s startup sector.
According to the most recent edition of the annual African Tech Startups Funding Report released by Disrupt Africa, available free in partnership with Flat6Labs, MarketForce, 4Di Capital, Mercy Corps Ventures, Newtown Partners, and InsiderPR, 633 African tech startups raised a combined US$3,333,071,000 in 2022.
Startup Ecosystems & Venture Capital:
JPMorgan Chase Shifts Focus to Startups and Venture Capital
JPMorgan Chase (NYSE:JPM), one of the largest banks in the United States, is shifting its focus to startups and venture capital firms, according to a recent interview with CEO Jamie Dimon on Bloomberg TV.
This strategic shift comes after the collapse of two large banks and the acquisition of First Republic Bank by JPMorgan.
Dimon said that JPMorgan wants to be a "key player" in the venture capital ecosystem, and the company is investing heavily in the space.
"We're seeing a lot of opportunity in the venture capital space," Dimon said. "We think there's a lot of innovation happening, and we want to be a part of it."
JPMorgan's move to focus on startups and venture capital is a sign of the changing banking landscape. Banks are increasingly looking to new ways to generate revenue, and investing in startups is one way to do that.
Startups are often seen as high-risk investments, but they also have the potential to generate high returns. Banks are willing to take on the risk in exchange for the potential rewards.
JPMorgan's shift to startups and venture capital is also a sign of the growing importance of technology in the banking industry. Banks are increasingly using technology to improve their services and reach new customers.
Kenyan fintech startup Lipa Later raises $3.4m debt funding, targets more
Kenya’s Lipa Later, a fintech platform founded to empower African businesses to do more by enabling e-commerce, financial inclusion, and shopping on a centralised and fully integrated platform, has raised KES500 million (US$3.4 million) from a privately-placed debt issuance to help it expand its offerings.
Founded in 2018, Lipa Later aims to empower African businesses to do more by enabling e-commerce, financial inclusion and shopping all on one centralised and fully integrated platform. The startup offers consumer credit, working capital and e-commerce solutions for merchants.
?Uganda in Advanced Talks with Chinese Credit Agency for EACOP Funding
Uganda is in advanced talks with SINOSURE, a Chinese export credit agency, to secure funding for its ambitious East African Crude Oil Pipeline (EACOP) project, according to a MarketScreener report on September 25, 2023.
The 1,445-kilometer (898-mile) pipeline is designed to transport crude oil from Uganda's western oilfields to a port on Tanzania's Indian Ocean coast.
The Ugandan government is seeking funding for the EACOP project after Western banks recently withdrew their support due to environmental concerns. The project is a collaborative effort between the government of Uganda, France's TotalEnergies, China's CNOOC, and Tanzania's Tanzania Petroleum Development Corporation (TPDC). The total cost of the project is estimated at $5 billion, with 40% of the funding expected to come from debt financing and the remainder from equity contributions.
South African Fintech Revio Secures $5.2 Million in Seed Funding
Revio, a South African startup specializing in payment API, has garnered seed funding of $5.2 million to expand its reach throughout the continent.
The company, committed to assisting merchants in enhancing their order-to-cash lifecycle, has declared a $5.2 million seed investment. This new funding follows the startup’s previous round, where it secured a $1.1 million funding round in 2022.
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Political & Geopolitical Dynamics:
Africa: Report - Africa Steering Geopolitical Challenges With Resilience, Economic Opportunities
Africa is attracting investment from various countries, including the United States, China, Russia, and the European Union. These countries are competing for support and access to the continent's economic opportunities.
Patricia Rodrigues, a Senior Analyst at Control Risks, a firm specializing in political, security, and integrity risks, said that African governments are trying to play all sides in order to secure pledges of investment.
During the U.S.-Africa Summit in December, Washington committed to allocate $55 billion to Africa over the next three years, focusing on healthcare, trade, climate change, and women's issues.
Reduced U.S. involvement in Africa in recent years has created opportunities for China, which has invested $10 billion in the continent from 2017 to 2022. Trade between Africa and Russia has also increased, growing from $9.9 billion in 2013 to $17.7 billion in 2021.
The influx of investment from global powers is a positive development for Africa. However, it is important for African governments to carefully consider the terms of investment agreements and to ensure that they are in the best interests of their countries.
Africa’s Francophone Spring? The Good Coup/Bad Coup Line
On the side of that line where coups are a disaster lies the elected but imperfect Nigerean and Malian governements, on the other side are where coups might be the only other option: most other countries in the neighborhood.
Gabon is a case in point and possibly a bellwether of the near future in that region. It is an example of where, perhaps, a coup was the only alternative to dislodge the sclerotic, corrupt “pretend” democracy of the Bongo family. Gabon was so spectacularly corrupt it aspired to anocracy.
The Geopolitical Forces Driving Today's Oil Market
The recent oil price rally has been driven, in large part, by Saudi Arabia's and Russia's efforts to cut supply to the global crude market.
Both China and the West are negatively impacted by high oil prices and will be eager to bring prices down using all the weapons at their disposal.
Ultimately, the price of oil going forward will be determined by the willingness and ability of these two interest groups to influence prices.
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Cybersecurity & Data Privacy:
October is Cybersecurity Awareness Month in Kenya
October is Cybersecurity Awareness Month (OCSAM) around the world, and the Communications Authority of Kenya (CA) is planning to celebrate with a month of cyber education.
Kenya is currently undergoing a digital transformation, and as a result, the country has seen an increase in the frequency of cyberattacks. This is to be expected as more and more people gain access to ICT services due to policy development and affordability.
The OCSAM is a global initiative that brings together public and private sectors to empower consumers of ICT services with the knowledge, skills, and resources they need to stay safe online.
The CA has kicked off the month by promising 31 days of cyber insights and engaging conversations. This will give the public a chance to learn about cybersecurity, become cyber-empowered, and network with others.
S.A Public Sector Security Summit 2023 to Address Cybersecurity Challenges
The Public Sector Security Summit 2023 (#PubliSec2023) will be held on October 3, 2023 at the Gallagher convention center in South Africa. The summit will bring together experts from the public and private sectors to discuss cybersecurity challenges and strategies specific to the public sector.
Attendees will include officials from public sector organizations such as Eskom, Nedbank, Transnet, the Gauteng Department of Finance, SARS, the South African Police Services, the Office of the Chief Justice, Accenture in South Africa, SASSA, and the Gauteng Central Government.
Keynote speakers will address essential topics delving deeper into the cybersecurity landscape, including:
1.?????? De – Witt Tromp – Solutions Engineer at Broadcom
2.?????? John Bosco Arends – Chairperson of the Chartered CIO Council and Group Head Information, Networks and Technology Operations
3.?????? Dr Nishal Khusial – Director of Technology, Imperium Advisory
4.?????? Pat Pather – Chief Executive Officer at Forensic Sciences Institute
5.?????? Derek Nareen – Chief Technology Officer at Digital Wave
6.?????? Michael O’Neil – Principal Analyst at Insightaas
7.?????? Silas Wachira Nthigah – Director ICT at Office of the Deputy President Republic of Kenya
8.?????? Dr Jabu Mtsweni – Chief Researcher and Head of the Cyber & Information Security Centre, CSIR
9.?????? Tsakani Dumezulu – Director – Goverment Information Technology Officer (GITO) at Department of Basic Education
These speakers will uncover a wide range of topics that delve deep into the core of cybersecurity and the unique challenges and strategies that can be applied in the public sector to mitigate risks. Their unique and extensive expertise will bring new perspective and insight into a topic that is fast becoming a top-priority in the midst of an ever-expanding digital landscape.
ODPC fines three companies a total of shs 9.4 million for data protection breach
The Office of the Data Protection Commissioner (ODPC) has fined three companies a total of Ksh.9,375,000 for violating the Data Protection Act, 2019.
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·?????? Mulla Pride Ltd., a digital credit provider, was fined Ksh.2,975,000 for using names and contact information obtained from third parties to send threatening messages and phone calls.
·?????? Casa Vera Lounge, a restaurant in Nairobi, was fined Ksh.1,850,000 for posting a customer's image on social media without their consent.
·?????? Roma School, an educational institution in Uthiru, was fined Ksh.4,550,000 for posting pictures of minors without parental consent.
The ODPC is the independent regulatory authority mandated to oversee the implementation of and enforce compliance with the Data Protection Act, 2019.
These penalties are a reminder that companies must take data protection seriously. The Data Protection Act gives individuals control over their personal data and requires companies to obtain consent before collecting, using, or disclosing personal data.
Companies that violate the Data Protection Act can be fined up to Ksh.5 million or 1% of their annual turnover, whichever is higher. They can also be ordered to stop processing personal data and to delete personal data that they have collected or processed illegally.
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AGRICULTURE AND AGRI-TECH
China’s agriculture modernization plan for Africa to advance growth, says Kenyan scholar
Once fully implemented, the plan will bring vitality to Africa’s food systems through joint research, technology transfer and the development of high-yielding crops, Richard Mulwa, deputy vice-chancellor of Egerton University, told Xinhua in a recent interview.
Read more: https://tinyurl.com/2h825pat
Labor & Education:
MozFest House: Kenya Tackles Critical Issues Facing Africa's Tech Landscape
The inaugural MozFest House: Kenya kicked off in Nairobi, bringing together a diverse group of African tech enthusiasts, pioneering researchers, and passionate human rights activists. With a strong focus on digital sovereignty, labor rights, and inclusion, the event has become a focal point for discussions on pivotal issues impacting the region.
Among the critical topics explored is the role of technology in perpetuating social injustices across Africa. Policymakers, technologists, and activists have not shied away from tackling the pressing concerns surrounding emerging technologies, particularly artificial intelligence (AI), and how they have exacerbated the marginalisation of vulnerable groups across the continent. The conversations have also zeroed in on the detrimental effects of extractive data practices, which continue to widen the gap between technology haves and have-nots.
The event has also seen an impressive turnout and has provided a platform for participants to delve into practical solutions to pressing issues like digital extractivism. Attendees have engaged in vigorous dialogues on the concept of introducing global content moderation unions, advocating for fair and equitable wages in the digital landscape, and building robust solidarity networks to support digital labor movements.
J. Bob Alotta, Senior Vice President, Global Programs at Mozilla, expressed the importance of the event's mission, stating, "Right now, East Africa — and the continent more broadly — is pushing for tech sovereignty. The policymakers, technologists, and activists at MozFest Kenya are on this campaign's frontlines, actively pursuing an internet where African perspectives and needs are the status quo."
MozFest House: Kenya is a significant event that is helping to shape the future of technology in Africa. By bringing together diverse stakeholders to discuss and address critical issues, the event is playing a key role in creating a more equitable and inclusive digital landscape for the continent.
How education sector can navigate data law minefield
Before the use of children’s personal data on social media platforms particularly for commercial purposes, educational institutions have a duty to notify parents and guardians of the rights of their children as the data subjects, the fact that they intend to collect their personal information the purpose for which the personal data is being collected, any third parties whose personal data has been or will be transferred to.
These include details of appropriate safeguards such as technical and organisational security, measures the institution has adopted to ensure confidentiality of the children’s data, whether any law necessitates the collection of such data to any law, whether such collection is voluntary or mandatory; and the consequences if any, where the data subject fails to provide all or any part of the requested information.
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Sales Associate at American Airlines
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