Nigeria Petroleum Bill

Africa Brief: African airlines not realising potential, Bank Zambia goes live on bourse and more….

African airlines “not realising potential”

Middle East airlines are benefiting from the fact that African nations are not taking advantage of the increase in air travel demand.
The manufacturers of the A320 aircraft announced that they were preparing to deliver two aircrafts to SAA. Mr Akoum (head of Africa sales for Airbus) said that airlines such as Qatar, Emirates and Etihad are positioning themselves to profit by increasing the number of African routes and flight frequency. Furthermore he stated that Nigeria has great opportunity for profit in the airline industry but Nigeria has not worked out how to run the airlines. He stated that the national carriers of Ethiopia and Kenya are the only ones that have realised some of their potential.

by David Furlonger published by Business Day on 27/05/2014

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Ethiopia opens door to retail managers, but keeps ownership

Ethiopia has pushed ajar the door for foreign retailers as managers but is keeping the state in control. This is intriguing, yet limiting, to Walmart and Nakumatt who want a foothold in this large sub-Saharan African economy. Ethiopia felt it needed to modernise its supply and distribution networks as well as increase competition to lower costs and inflation. This movement towards introducing foreign retailers is a big threat to local supermarkets and small traders. Therefore Ethiopia is going to launch a state-owned wholesaler which will be run as a private business and will hopefully decrease the competition’s prices. Although the IMF has warned that huge state spending and squeezing out private business could derail economic growth. The Ethiopian middle class is very brand conscious and is demanding more convenience, brands and choice. Ethiopia will have to increase its supply and distribution if it wants to keep a lid on costs. Locals are not optimistic about welcoming foreign retailers.

by Richard Lough published by The Star Business Report on 27/05/2014

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Bank Zambia goes live on bourse

Finance bank Zambia has gone live as a clearing member on the Zambian Derivatives Exchange.

Excerpt from : Bank Zambia goes live on bourse  published by Business Day on 28/05/2014

Egypt: Fuel subsidies to be reduced

Yesterday the government announced that they plan to cut fuel subsidies. The finance ministry predicted economic growth of 3.2% in a final budget draft, up from an estimated 2% to 2.5% this year. Egypt’s economy has been struggling with a deficit of 14% of GDP last year. GDP growth has been boosted this year by Gulf aid.

by Reuters published by The Star Business Report on 27/05/2014

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Kenya: Central bank backs shilling

Kenya’s central bank held adequate foreign exchange reserves to cushion the shilling against temporary shocks. Governor Ndung’u blamed seasonal factors for the volatility of the shilling. Traders however attribute the weakening of the currency to the recent bombings in Nairobi and on the coast that have shaken market confidence.

by Reuters published by The Star Business Report on 27/05/2014

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Kenya: Equity plans mobile banking

Equity Bank of Kenya planned to launch a mobile telecoms service in July. The bank said that Kenya has led the world with Safaricom, offering banks a cheap way to reach a large number of people without access to financial services. The bank has teamed up with the nation’s second largest telecoms firm to roll out its new service.

by Reuters published by The Star Business Report on 27/05/2014

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Niger: Uranium prices freeze project

Nuclear Group Areva is going to suspend the development of the Imouraren mine until uranium prices improve. This deal will place current Areva mines under a 2006 mining law. The new mine was said to start production at the end of next year after a series of delays.

by Reuters published by The Star Business Report on 27/05/2014

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Nigeria unit helps grow Nampak profit

Nampak’s new beverage line in Nigeria has been quite successful increasing group trading income by 10%. Apart from SA, the rest of Africa now accounts for 24% (R1.5bn) of the groups trading profit. The company saw improvements in Angola for last year’s results and Zambia’s results held steady. It is believed Nigeria will become a huge contributor to the group’s income from Africa. However trading in SA is a bit more challenging. Yet Nampak produces 1.7 billion cans annually in Angola. Overall group revenue, trading profit, EPS and the dividend all increased. The paper businesses however experienced weak demand and trading profits.
The plastic business experienced reduced demand

Excerpt from : Nigeria unit helps grow Nampak profit by Mark Allix published by The Star Business Report on 28/05/2014

Africa is brightest spot for Nampak

Nampak is looking to expand elsewhere in Africa. It concluded yesterday that South Africa would remain challenging in the future as revenue growth was a mere 9% compared to the rest of Africa which was 24%. The dividend and EPS both increased.
Performance in Angola and Nigeria both improved and a further beverage plant is lined up for both and in Malawi there was an increase in tobacco box sales. However performance in Zambia decreased. The chief executive of Nampak feels if costs and relationships with suppliers are managed the business should do well. Nampak shares have declined. The fact that the rand weakened so significantly could have boosted the growth rate %.

Excerpt from : Africa is brightest spot for Nampak by Wiseman Khuzwayo published by The Star Business Report on 28/05/2014

David Okwara
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