Africa Brief

Africa Brief: Marriott targets new African markets, Bank lending rate lowered and more…

Marriott targets new African markets to lift revenue 10%

According to Marriott’s growth vision, the hotel chain is expecting a 4-6% increase in existing hotels and a 4-5% increase in new hotels. This would lift their revenue within a 10% range. Marriott further plans to open as many as 50 new hotels within the Middle East and Africa due to the booming business travel and economies within this region- this comes after the purchase of Cape Town based Protea Hospitality Holdings in April for $200 million.

Excerpt from Marriott targets new African markets to life revenue 10%, published in The Star, Business Report on 26/06/2014

Bank lending rate lowered

Rwanda’s central bank had lowered its benchmark lending rate for the first time in a year from 7% to 6.5% due to support economic recovery. However, price pressures remain with urban inflation although the country is in the process of recovery from last year’s slow down. Key economic indicators show that growth will continue in the second quarter.

by Bloomberg published in The Star, Business Report on 26/06/2014

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Eurobond ‘will cut borrowing’

After Kenya’s successful debut $2 billion (R21bn) Eurobond will cut the government’s local borrowing requirements. This, in turn will decrease interest rates which according to President Uhuru Kenyatta will create a boost in investments, spur economic growth and provide more employment opportunities for the Kenyans.

by Reuters published in The Star, Business Report on 26/06/2014

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East African countries initiate oil pipeline studies

Kenya, Rwanda and Uganda have invited bids for a single consultant to oversee a feasibility study and initial design plan for the construction of a 1300 km oil pipeline to transport crude oil to the Kenyan coastline. Kenya’s ministry of energy and petroleum said in addition to the pipeline, the consultant would be required to oversee the construction of a fibre-optic cable from Hoima in Uganda through the Lokichar basin in northwest Kenya to Lamu, and tank terminals in Hoima, Lokichar and Lamu.

A single consultant is preferred in order to ensure consistency in the pipeline. The plan for a single con­sultant and transaction adviser was approved by the govern­ments of Kenya, Uganda, Rwanda, South Sudan, Tanza­nia and Burundi last month. Kenya’s plans for oil production have moved fast since Tullow and Africa Oil’s first discoveries were announced in March 2012.

by Reuters published in The Star, Business Report on 26/06/2014

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FNB banks on Mozambique

A year after FNB had launched its Zimbabwe money transfer services, the bank has decided to expand its services to Mozambique. Head of cross border remittance- Leonardo van der Plaas has said that they had seen a real need for remittance services with the FNB Zimbabwe Money Transfer services and it is easily accessible.

Furthermore, she had said that their services were safe and affordable and thus 66% of customers had showed a repeat usage of their services. FinMark 2012 said that around 486840 Mozambicans live in South-Africa and send approximately 1,6 billion rands annually to their relatives back home. A 4,5% fee will be charged on the amounts sent via these money transfer services.

Excerpt from FNB banks on Mozambique, published in The New Age on 26/06/2014

Burundi mining project stakes finalised

Burundi’s government took a 15 percent stake while in a project to build a nickel and iron mine. The 85 percent interest is held by Burundi Mining Metallurgy (BMM).  The state’s stake in Burundi Musongati Mining (the project), was part of the terms of a mining licence agreement signed this month. The project would require investment to construct the mine and a facility to process 1 million tons of ore annually into iron, nickel and cobalt within the next five years. The goal to increase capacity at the plant within a decade will cost about $3 billion (R31.9bn).

by Bloomberg published in The Star, Business Report on 24/06/2014

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Leviev strikes diamond deal

Billionaire Lev Leviev struck a deal with Angola allowing him to charge more for diamonds he mines in the country. The Israeli property magnate would be able to sell gems from his Luminas mine on world markets instead of at a discount to specified Chinese and Dubai traders. The deal might allow Leviev to raise prices by up to 50 percent. Stones from Catoca, the world’s fourth-biggest mine, are sold through Angola’s Sodiam state marketing unit to preferred buyers at an average of $100 fetch about $150 on the world diamond market.

by Bloomberg published in The Star, Business Report on 24/06/2014

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Court blocks Serengeti Road

The East African Court of Justice has blocked Tanzania’s plans to build a highway through the Serengeti National Park. Environmentalists had warned that the 54km highway would disturb the annual migration of more than a million wildebeest to the Maasai Mara National Reserve in Kenya and would result in collisions between animals and traffic. The construction of the highway would violate East African Community (EAC) rules on the preservation and sustainable use of natural resources.

by Bloomberg published in The Star, Business Report on 24/06/2014

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Economy seen growing 20%

Tanzania’s government expects the size of the economy to grow by 20 percent after rebasing its gross domestic product (GDP) data to factor in expanding industries such as mining and natural gas. The revised figures would be released in September, Daniel Masolwa, a manager at the National Bureau of Statistics. Mining accounts for 4 percent of its GDP although it is Africa’s fourth-largest gold producer. Tanzania, which has natural gas reserves estimated at 50.5 trillion cubic feet, is building a pipeline and plans to develop a liquefied natural gas plant to become an exporter. It already produces gas for domestic use.

Excerpt from Economy seen growing 20% published in The Star, Business Report on 24/06/2014

Airline picks up Zimbabwe flights

FastJet would commence flights to Zimbabwe from its operating base in Tanzania, adding a third global destination after South Africa and Zambia, the London-based airline said yesterday FastJet would begin twice-weekly flights from Dares Salaam to Harare from August 5, providing the only direct scheduled service on the route. Founded in 2012 with the goal to become the first pan-African low-cost carrier, FastJet flew within Tanzania before commencing flights to Johannesburg in October and later adding Zambian capital Lusaka.

by Bloomberg published in The Star, Business Report on 24/06/2014

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FirstRand funds Ghana project

FirstRand’s investment banking unit would finance as much as $120 million (R1.3 billion) of Ghana’s $820m Kpone power plant as lenders looked to gain from African infrastructure projects, the firm said yesterday. The 340 megawatt Kpone gas and oil plant would help Ghana, the world’s second-largest cocoa producer, plug an electricity shortfall of 200MW

by Bloomberg published in The Star, Business Report on 24/06/2014

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David Okwara

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