<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="720" height="425" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/06/ANCK25OQIFMHTJYACOM5XU5T24.jpg" alt="" class="wp-image-498541" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/06/ANCK25OQIFMHTJYACOM5XU5T24.jpg 720w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/ANCK25OQIFMHTJYACOM5XU5T24-300x177.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/ANCK25OQIFMHTJYACOM5XU5T24-152x90.jpg 152w" sizes="auto, (max-width: 720px) 100vw, 720px" /><figcaption class="wp-element-caption">Kenya shilling coins and notes are pictured inside a cashier&#8217;s booth at a forex exchange bureau in Kenya&#8217;s capital Nairobi, April 20, 2016. REUTERS/Thomas Mukoya/File Photo</figcaption></figure>



NAIROBI, July 12 (Reuters) &#8211; Kenya&#8217;s shilling weakened on Friday due to increased demand for dollars from general goods importers, while inflows from non-governmental organisations cushioned it from easing further, traders said.



At 0734 GMT, commercial banks quoted the shilling at 128.75/129.75 per dollar, compared with Thursday&#8217;s closing rate of 128.50/129.50.



Traders said there was no immediate reaction to President William Ruto dismissing all but one of his ministers on Thursday, yielding to one of the demands from nationwide protests that have created the biggest crisis of his two-year presidency.



(Reporting by George Obulutsa; Editing by Bate Felix)

ANCK25OQIFMHTJYACOM5XU5T24

Kenya’s shilling weakens due to high dollar demand from importers

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="567" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/Z6ZWDH7YP5PTDIR6R7OWDNZ6MI-820x567.jpg" alt="" class="wp-image-506707" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/Z6ZWDH7YP5PTDIR6R7OWDNZ6MI-820x567.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/Z6ZWDH7YP5PTDIR6R7OWDNZ6MI-300x208.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/Z6ZWDH7YP5PTDIR6R7OWDNZ6MI-130x90.jpg 130w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/Z6ZWDH7YP5PTDIR6R7OWDNZ6MI-768x531.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/Z6ZWDH7YP5PTDIR6R7OWDNZ6MI-1536x1063.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/Z6ZWDH7YP5PTDIR6R7OWDNZ6MI-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">Kenya&#8217;s President William Ruto addresses the nation after he dissolved his entire cabinet apart from the foreign minister in the wake of nationwide protests over new taxes, at State House in Nairobi, Kenya July 11, 2024. REUTERS/Thomas Mukoya</figcaption></figure>



NAIROBI, July 12 (Reuters)&nbsp;&#8211;&nbsp;Luxury cars, private helicopters, mounds of cash. The lavish lifestyles of Kenya&#8217;s lawmakers, splashed across TikTok and X, added fuel to anger simmering last month among a young, plugged-in population over proposed tax hikes.



Weeks-long protests about the tax measures have increasingly drawn attention to the large salaries, perks and ostentation of members of parliament (MPs) in a country where three quarters of the population is young and well-paid work is scarce.



Fury boiled over on June 25, when protesters stormed parliament and set it ablaze, pelting fleeing politicians&#8217; vehicles with stones. Since then, private residences and businesses of several MPs, mainly those associated with the ruling coalition, have been attacked.



Now, TikTok and X are being wielded as protest tools. Politicians&#8217; videos are edited and reposted with negative comments. The platforms are awash with allegations of mismanaged funds and discussions on next steps for the as-yet largely leaderless youth movement.



Activists are sharing advice how to use recall powers to topple representatives and have even built an AI-powered chatbot that spits out media reports of corruption allegations when a politician&#8217;s name is entered.



In April and May during the build-up to the protests, ruling party MP Zaheer Jhanda posted videos of himself on TikTok admiring his gleaming Range Rover, a Mercedes G Wagon and a Lexus, triggering angry online commentary.



Protesters have since tried to storm his home, in the western town of Kisii.



Jhanda did not respond to requests for comment.



&#8220;Why would you show us your lavish lifestyle and still not do your job as a leader?&#8221; said artist and activist Rachel Stephanie Akinyi, referring to politicians&#8217; social media posts.



&#8220;What are you trying to show us? &#8216;We have the power to use your money the way we want to, to take care of our own needs.&#8217; But what about us?&#8221;, said Akinyi, who goes by the stage name &#8216;Spontaneous The Poet&#8217;.



In a sign of the pressure the protests are keeping on President William Ruto, on Thursday he said that after listening to Kenyans and reflecting, he had dismissed his entire cabinet apart from the foreign minister, with the aim of setting up a new &#8220;broad-based government.&#8221;



Last week, Ruto, 57, said some officials displayed &#8220;obnoxious opulence.&#8221; He announced austerity measures including cuts to his own offices budget and ordered a review of pay rises MPs and other officials had been due to receive in July.



Didmus Barasa, the ruling party MP for Kimilili in Western Kenya, told Reuters the protesters had valid concerns about what he called the &#8220;insensitivities&#8221; of the government&#8217;s handling of economic development. He did not give further details.



Barasa denied MPs were overpaid.



His personal wealth, including a private helicopter, was a reward for legitimate business activities, he said. Barasa, who is a former soldier and not widely known as a businessman, said he owned a hospital in Turkey.



&#8220;Yes, I have a helicopter. I have a helicopter that I purchased,&#8221; he said. &#8220;I am an inspiration of very many young people in this country.&#8221;



Barasa, after being questioned by a senator about the helicopter, previously said in online comments that he could afford it because he chose to maintain only one wife and believed in God.



Caroline Gaita, Executive Director of Mzalendo, an organisation that monitors parliament, said young Kenyans previously disinterested in politics are re-engaging, aware of the impact legislation has on their daily lives and demanding lawmakers listen to them.



Calling the protests an &#8220;awakening of Gen Z,&#8221; Tom Mboya, an expert on politics and corruption in Kenya, said there was a perception that politicians were rarely, if ever, held to account since Ruto took office in 2022.



&#8220;They have become bolder in their flashy and opulent lifestyles at a time when Kenyans are being taxed to their limit,&#8221; Mboya said of officials and MPs, some of whom have been filmed handing out wads of cash to people in their constituencies.



In 2023, Kenya ranked 126 out of 180 countries in the world by Transparency International&#8217;s Corruption Perception Index,&nbsp;down three places from 2022.



Ruto&#8217;s office did not respond to requests for comment on this story.



<h2 class="wp-block-heading" id="h-lawmakers-face-recall">LAWMAKERS FACE RECALL</h2>



On June 26, Ruto scrapped the tax hikes that triggered the unrest. At least 39 people have been killed in violence related to the protests.



But the anger did not fade.



Having faced little opposition since his 2022 election, Ruto and MPs must now contend with smaller but ongoing country-wide protests that transcend political and ethnic divides that have historically shaped social movements in Kenya, a regional power and Western ally.



There is a growing push for lawmakers to be removed now rather than wait until elections in 2027, with guidelines published online on how to do it, in what would be the first use of recall powers introduced in 2010.



The process involves collecting signatures of at least 30 percent of registered voters in the constituency and then presenting them to the election commission.



Voters in Kabete constituency near Nairobi have collected 5,000 of the 10,000 signatures they need to recall their MP, Ndungi Githuku, a human rights activist involved in the process said.



&#8220;I&#8217;m hoping that Kabete will be able to inspire the rest of the country to take action&#8221; Githuku said. &#8220;We are taking this country back.&#8221;



Kenya&#8217;s opposition, wary of being caught up in the wave of discontent, has named six of its own members to be recalled, subject to the same process.



Even if the MPs who are under pressure escape being ousted, they have lost legitimacy in the eyes of Kenyans, said Senator Richard Onyonka, who was an MP for 15 years.



“I think they are heavily damaged,” he said.



<h2 class="wp-block-heading" id="h-dishing-out-millions">DISHING OUT MILLIONS</h2>



Kenyan MPs earn around 33 times the national average wage, and are no strangers to accusations of corruption and waste.



Basic pay for MPs is currently 725,502 Kenya shillings ($5,650) per month in a country where annual per capita income is about $2,000, making them among the best paid in the world compared to average incomes.



They can claim extra money for sitting on committees, cheap loans for houses and extra vehicles, and thousands of dollars per month for travel to constituencies.



Every year, each of Kenya&#8217;s 290 MPs is given over $1 million under a scheme called Constituency Development Funds (CDF) set up to promote local development. The programme has long been plagued by accusations from Kenya&#8217;s Auditor-General (AG) and the national media that the money is inefficiently spent or embezzled.



Kenya&#8217;s Supreme Court ruled in 2022 that the scheme was unlawful but it has not been scrapped, providing MPs with cash to hand out on building classrooms, subsidising education or improving security.



A Reuters analysis of 100 audits of constituency spending by the Auditor-General found 42 constituencies where a total of about 1.7 billion shillings ($13 million) of spending under the CDF scheme on bursaries for school children could not be fully accounted for in the 2021/22 financial year.



The remaining 58 audits reviewed did not mention the bursaries.



The Speaker of the National Assembly did not reply to requests for comment.



MPs have long justified high pay saying that they are expected to distribute cash in their constituencies.



A 2021 report by UK and Dutch think-tanks the Westminster Foundation for Democracy Limited (WFD) and the Netherlands Institute for Multiparty Democracy found aspiring members of Kenya&#8217;s parliament had to spend over $180,000, mostly out their own pockets, to campaign in 2017, a figure likely to have risen in 2022, according to anti-corruption expert Mboya, one of the authors.



At weekends, it is not unusual for lawmakers to return home in fleets of SUVs or by helicopter.



&#8220;People are angry and hate us as leadership because every weekend, helicopters crisscross the sky, all of them going to functions where these millions are being dished (out),&#8221; Boni Khalwale told fellow senators on July 3.



(Additional reporting by Edwin Okoth, Edwin Waita and Aaron Ross in Nairobi; Editing by Frank Jack Daniel)

Kenya’s President Ruto sacks cabinet after nationwide protests over new taxes

Social media fuels Kenyan youth backlash over lawmakers’ opulence

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="572" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/XFNOXFRHRNJ3PLPFQZF66W3MBE-820x572.jpg" alt="" class="wp-image-506368" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/XFNOXFRHRNJ3PLPFQZF66W3MBE-820x572.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/XFNOXFRHRNJ3PLPFQZF66W3MBE-300x209.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/XFNOXFRHRNJ3PLPFQZF66W3MBE-129x90.jpg 129w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/XFNOXFRHRNJ3PLPFQZF66W3MBE-768x536.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/XFNOXFRHRNJ3PLPFQZF66W3MBE-1536x1071.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/XFNOXFRHRNJ3PLPFQZF66W3MBE.jpg 1822w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">Kenya&#8217;s President William Ruto speaks at a press conference where he announced spending cuts in government after protests against Kenya&#8217;s proposed finance bill 2024/2025, in Nairobi, Kenya, July 5, 2024. REUTERS/Monicah Mwangi</figcaption></figure>



NAIROBI, July 11 (Reuters)&nbsp;&#8211;&nbsp;Kenyan President William Ruto on Thursday fired his entire cabinet apart from the foreign minister, bowing to pressure from&nbsp;nationwide protests that have created&nbsp;the biggest crisis of his two-year presidency.



The youth-led protests against planned tax hikes started off peacefully but turned violent, killing at least 39 people in clashes with the police last month. Some demonstrators briefly stormed parliament, before Ruto abandoned the new taxes.



&#8220;I will immediately engage in extensive consultations across different sectors and political formations and other Kenyans, both in public and private, with the aim of setting up a broad-based government,&#8221; Ruto said in a televised address to the nation, adding that he would announce additional measures later.



He also dismissed the attorney general but said the office of the deputy president was not affected.



The sweeping cabinet changes were what Kenyans have been asking for, veteran anti-corruption activist John Githongo told Reuters.



&#8220;Let us see what happens now if the new ministers deal with big issues around corruption and just the arrogance and excess of his administration and the fact that a lot of Kenyans died during the demonstrations,&#8221; he said. &#8220;Hopefully this should temporarily calm things.&#8221;



Ruto has been caught between the demands of lenders such as the International Monetary Fund (IMF) to cut deficits and a hard-pressed population reeling from rising cost of living.



Last week he proposed spending cuts and additional borrowing in roughly equal measure to fill the nearly $2.7 billion budget hole caused by the withdrawal of the tax hikes.



Analysts have said the tax rollback means Kenya is likely to miss IMF targets although the government does not have debts that are due.



The budget deficit is now projected at 4.6% of gross domestic product in the fiscal year that started on July 1.



Ojango Omondi, a community activist from the Social Justice Centres Working Group in Nairobi, said dismissing so many cabinet ministers was a &#8220;move towards justice&#8221;, but activists would want to see who Ruto appoints in their place.



&#8220;It&#8217;s one thing to dismiss, the second is to ensure that the people that will be chosen in the cabinet are accountable to the constitution and the rule of law,&#8221; Omondi said.



(Additional reporting by Aaron Ross in Nairobi and Bhargav Acharya in Johannesburg; Writing by Alexander Winning; Editing by Bate Felix and Arun Koyyur)

Kenya’s President announces government spending cuts after protest against Kenya’s proposed finance bill 2024/2025, in Nairobi

Kenyan president sacks cabinet, bowing to pressure from protests

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="543" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/LLWMXSWBVJMF3BMTIDLHLYEXLI-820x543.jpg" alt="" class="wp-image-506323" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/LLWMXSWBVJMF3BMTIDLHLYEXLI-820x543.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/LLWMXSWBVJMF3BMTIDLHLYEXLI-300x199.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/LLWMXSWBVJMF3BMTIDLHLYEXLI-136x90.jpg 136w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/LLWMXSWBVJMF3BMTIDLHLYEXLI-768x508.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/LLWMXSWBVJMF3BMTIDLHLYEXLI-1536x1017.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/LLWMXSWBVJMF3BMTIDLHLYEXLI-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">FILE PHOTO: Rwanda&#8217;s President Paul Kagame of the ruling Rwanda Patriotic Front (RPF) party sits to submit his candidacy for an a July 15 election at Rwanda&#8217;s National Election Commission in Kiyovu, Kigali, Rwanda May 17, 2024. REUTERS/Jean Bizimana/File Photo</figcaption></figure>



KIGALI, July 11 (Reuters)&nbsp;&#8211;&nbsp;Rwandan President Paul Kagame is expected to cruise to a fourth term in office in an election on Monday against two opposition candidates who were cleared to run against him but have only modest expectations.



Kagame, 66, helped lead the rebel movement that ended the 1994 genocide in Rwanda and has served as president since 2000. He faces only two rivals because six other potential candidates were not cleared to run by the state-run electoral commission.



Kagame won nearly 99% of the vote in the last election in 2017, which followed a constitutional change removing term limits that would have barred him from standing again.



His reelection could signal further stability but also continued global scrutiny, given accusations of rights abuses and continued tensions with neighbouring Democratic Republic of Congo.



Kagame has won praise during his tenure for rebuilding the country of 14 million after the genocide, in which more than a million people were killed. Rwanda has emerged as a regional financial hub.



But his government has been accused by Western nations and rights activists of muzzling the media, assassinating opponents, and backing rebel groups in neighbouring Congo.



International scrutiny was intensified by the migration deal Rwanda struck in 2022 to receive thousands of asylum seekers from Britain. Newly elected British Prime Minister Keir Starmer confirmed on Saturday he would scrap the agreement.



Rwanda&#8217;s government has denied all the accusations against it, and while campaigning, Kagame promised continued development and stability.



&#8220;With you, there is nothing our country will not achieve, because today you have leaders who are not foolish and you are not foolish,&#8221; he told young supporters at a rally last week in Eastern Province.



<h2 class="wp-block-heading" id="h-two-challengers">TWO CHALLENGERS</h2>



Eight candidates had applied to run against Kagame, but only two were retained in the final list validated by the electoral commission. The others, including Kagame&#8217;s most vocal critics, were invalidated for various reasons that included prior criminal convictions.



The two approved candidates, Frank Habineza and Philippe Mpayimana, ran against Kagame in 2017.



In an interview with Reuters, Habineza, the leader of the Democratic Green Party, said he expected to exceed his total of 0.48% of the vote from 2017.



&#8220;People are only considering 2017 and say that I got 0.4%, but they forget that our party stood for parliament and got more than 5%,&#8221; he said.



Mpayimana, who works for the Ministry of National Unity and Civic Engagement, urged voters at a campaign event to consider his candidacy.



&#8220;It&#8217;s true you cannot change the winning team, but we also have to give opportunities to the junior teams to see if they can deliver on their pledges. That is what democracy means,&#8221; he said.



Over 9 million voters are registered for the polls in which they will also elect members of the 80-seat lower house of parliament. Provisional results are expected by July 20.



(Reporting by Aaron Ross, Editing by Bate Felix and Timothy Heritage)

FILE PHOTO: Rwanda’s President Paul Kagame submits his candidature for re-election in Kigali

Kagame expected to cruise to fourth term in Rwanda election

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="429" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/HCVRNAVJRJMOJBUK4XOB7PEJGY-820x429.jpg" alt="" class="wp-image-506011" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/HCVRNAVJRJMOJBUK4XOB7PEJGY-820x429.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/HCVRNAVJRJMOJBUK4XOB7PEJGY-300x157.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/HCVRNAVJRJMOJBUK4XOB7PEJGY-160x84.jpg 160w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/HCVRNAVJRJMOJBUK4XOB7PEJGY-768x402.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/HCVRNAVJRJMOJBUK4XOB7PEJGY.jpg 1200w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">A teller serves a client with Kenya shilling notes at the cashier&#8217;s booth of a forex exchange bureau in Kenya&#8217;s capital Nairobi, April 20, 2016. REUTERS/Thomas Mukoya/File Photo</figcaption></figure>



NAIROBI, July 10 (Reuters) &#8211; Kenya&#8217;s shilling weakened on Wednesday, pressured by increased foreign-currency demand and a credit rating downgrade by Moody&#8217;s, traders said.



At 0800 GMT, commercial banks quoted the shilling at 128.25/129.25 per dollar, compared with Tuesday&#8217;s closing rate of 127.75/128.75.



Moody&#8217;s pushed Kenya&#8217;s sovereign rating deeper into junk territory on Monday, citing the country&#8217;s diminished capacity to implement a fiscal consolidation strategy after the president withdrew planned tax hikes in response to mass protests.



Traders said the higher foreign-currency demand was mainly coming from the manufacturing sector and general goods importers.



(Reporting by George Obulutsa; Editing by Alexander Winning)

HCVRNAVJRJMOJBUK4XOB7PEJGY

Kenyan shilling weakens due to increased FX demand, Moody’s downgrade

<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="2048" height="1366" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-1604532787-scaled.jpg" alt="" class="wp-image-506008" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-1604532787-scaled.jpg 2048w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-1604532787-300x200.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-1604532787-820x547.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-1604532787-135x90.jpg 135w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-1604532787-768x512.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-1604532787-1536x1025.jpg 1536w" sizes="auto, (max-width: 2048px) 100vw, 2048px" /><figcaption class="wp-element-caption">Ugandan shilling and US dollars in the draw at a foreign exchange currency bureau in Kampala, Uganda, on Wednesday, Aug. 16, 2023. Uganda&#8217;s central bank said it stands ready to act if the World Bank&#8217;s decision to halt new funding over the country&#8217;s passage of anti-LGBTQ legislation impacts the currency further. Photographer: Luke Dray/Bloomberg via Getty Images</figcaption></figure>



KAMPALA, July 10 (Reuters) &#8211; The Ugandan shilling was stable on Wednesday, underpinned by dollar inflows from offshore investors and some commodity exporters weighing against thin importer appetite, traders said.



At 0710 GMT, commercial banks quoted the shilling at 3,700/3,710, the same level as Tuesday&#8217;s close.



(Reporting by Elias Biryabarema; Editing by George Obulutsa)

Ugandan Economy Following Rate Cut

Ugandan shilling stable as offshore investor FX inflows help

<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="720" height="425" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/06/ANCK25OQIFMHTJYACOM5XU5T24.jpg" alt="" class="wp-image-498541" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/06/ANCK25OQIFMHTJYACOM5XU5T24.jpg 720w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/ANCK25OQIFMHTJYACOM5XU5T24-300x177.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/ANCK25OQIFMHTJYACOM5XU5T24-152x90.jpg 152w" sizes="auto, (max-width: 720px) 100vw, 720px" /><figcaption class="wp-element-caption">Kenya shilling coins and notes are pictured inside a cashier&#8217;s booth at a forex exchange bureau in Kenya&#8217;s capital Nairobi, April 20, 2016. REUTERS/Thomas Mukoya/File Photo</figcaption></figure>



NAIROBI, July 9 (Reuters) &#8211; Kenya&#8217;s shilling was steady on Tuesday, with dollar supply and importer demand matching, traders said.



At 0721 GMT, commercial banks quoted the shilling at 127.75/128.75 per dollar, unchanged from Monday&#8217;s closing.



Traders said there was no immediate reaction in the foreign exchange market to Moody&#8217;s downgrading Kenya&#8217;s sovereign rating deeper into junk territory on Monday.



(Reporting by George Obulutsa; Editing by Bate Felix)

Kenya’s shilling holds steady as dollar supply meets importer demand

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="523" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/G5RU4II5WFP75F4POZ2VUFIWME-820x523.jpg" alt="" class="wp-image-505609" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/G5RU4II5WFP75F4POZ2VUFIWME-820x523.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/G5RU4II5WFP75F4POZ2VUFIWME-300x191.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/G5RU4II5WFP75F4POZ2VUFIWME-141x90.jpg 141w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/G5RU4II5WFP75F4POZ2VUFIWME-768x490.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/G5RU4II5WFP75F4POZ2VUFIWME-1536x980.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/G5RU4II5WFP75F4POZ2VUFIWME-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">FILE PHOTO: A general view shows the central business district in downtown Nairobi, Kenya February 18, 2022. REUTERS/Thomas Mukoya</figcaption></figure>



July 8 (Reuters)&nbsp;&#8211;&nbsp;Moody&#8217;s cut Kenya&#8217;s sovereign rating deeper into junk territory on Monday, citing diminished capacity to implement a fiscal consolidation strategy to contain its debt burden.



The credit ratings agency downgraded the country&#8217;s local- and foreign-currency long-term issuer ratings and foreign-currency senior unsecured debt ratings to &#8220;Caa1&#8221; from &#8220;B3&#8221;.



In June, Kenyan President Willian Ruto withdrew planned tax hikes in response to mass protests that turned deadly, killing at least 24 people.



The scrapped finance bill contained measures intended to aid the government&#8217;s aim to raise $2.7 billion in additional taxes to reduce budget deficit and state borrowing.



In order to compensate for the withdrawn finance bill, Ruto&#8217;s administration has proposed cuts in spending.



Moody&#8217;s said that while the spending cuts should narrow fiscal deficit, it would be at a more gradual pace than previously assumed, and as a result expect Kenya&#8217;s debt affordability to remain weaker for longer.



&#8220;In the context of heightened social tensions, we do not expect the government to be able to introduce significant revenue-raising measures in the foreseeable future,&#8221; the ratings agency said.



Moody&#8217;s affirmed its &#8216;negative&#8217; outlook for Kenya, stating that the larger fiscal deficits will push up borrowing requirements and subsequently increase government liquidity risks.



(Reporting by Raechel Thankam Job; Editing by Maju Samuel)

General view of the central business district in Nairobi

Moody’s pushes Kenya’s rating deeper into junk

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="547" src="https://cms.cnbcafrica.com/wp-content/uploads/2023/02/GettyImages-924883576-1-820x547.jpg" alt="" class="wp-image-422955" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2023/02/GettyImages-924883576-1-820x547.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2023/02/GettyImages-924883576-1-300x200.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2023/02/GettyImages-924883576-1-135x90.jpg 135w, https://cms.cnbcafrica.com/wp-content/uploads/2023/02/GettyImages-924883576-1-768x512.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2023/02/GettyImages-924883576-1-1536x1024.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2023/02/GettyImages-924883576-1-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">Uganda shillings. Uganda. (Photo by: Godong/Universal Images Group via Getty Images)</figcaption></figure>



KAMPALA, July 8 (Reuters) &#8211; The Ugandan shilling weakened on Monday due to increased demand for dollars from commercial banks and merchandise importers, traders said.



At 0905 GMT, commercial banks quoted the shilling at 3,705/3,715 per dollar, compared with Friday&#8217;s closing rate of 3,693/3,703.



(Reporting by Elias Biryabarema; Editing by George Obulutsa)

GettyImages-924883576-1

Ugandan shilling weakens on increased FX demand from banks, importers

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="547" src="https://cms.cnbcafrica.com/wp-content/uploads/2021/07/GettyImages-880072092-820x547.jpg" alt="" class="wp-image-409717" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2021/07/GettyImages-880072092-820x547.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2021/07/GettyImages-880072092-300x200.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2021/07/GettyImages-880072092-120x80.jpg 120w, https://cms.cnbcafrica.com/wp-content/uploads/2021/07/GettyImages-880072092-768x512.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2021/07/GettyImages-880072092-1536x1024.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2021/07/GettyImages-880072092-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">Kenyan shilling banknotes and coins sit arranged at a market stall in Mombasa, Kenya, on Thursday, Nov. 23, 2017. The countrys Treasury has already cut this years growth target to 5 percent from 5.9 percent as the protracted election furor damped investment and a drought curbed farm output. Photographer: Luis Tato/Bloomberg via Getty Images</figcaption></figure>



NAIROBI, July 8 (Reuters) &#8211; Kenya&#8217;s shilling was steady on Monday, but it was expected to gain ground in the next few days due to increased dollar inflows from tea exporters, traders said.



At 0752 GMT, commercial banks quoted the shilling at 127.75/128.75 per dollar, the same as Friday&#8217;s closing rate.



(Reporting by George Obulutsa; Editing by Alexander Winning)

General Economy As Kenya Faces Bleak 2018 Outlook In Vote Aftermath

Kenya’s shilling stable, seen firming due to tea export FX inflows

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="546" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/108002009-17201812992024-07-05t115950z_1558437106_rc2zo8ashg9w_rtrmadp_0_britain-election-820x546.jpeg" alt="" class="wp-image-505243" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/108002009-17201812992024-07-05t115950z_1558437106_rc2zo8ashg9w_rtrmadp_0_britain-election-820x546.jpeg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/108002009-17201812992024-07-05t115950z_1558437106_rc2zo8ashg9w_rtrmadp_0_britain-election-300x200.jpeg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/108002009-17201812992024-07-05t115950z_1558437106_rc2zo8ashg9w_rtrmadp_0_britain-election-135x90.jpeg 135w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/108002009-17201812992024-07-05t115950z_1558437106_rc2zo8ashg9w_rtrmadp_0_britain-election-768x512.jpeg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/108002009-17201812992024-07-05t115950z_1558437106_rc2zo8ashg9w_rtrmadp_0_britain-election-1536x1024.jpeg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/108002009-17201812992024-07-05t115950z_1558437106_rc2zo8ashg9w_rtrmadp_0_britain-election-scaled.jpeg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">British Prime Minister Keir Starmer delivers his speech outside Downing Street 10, following the results of the election, in London, Britain, July 5, 2024.  Claudia Greco | Reuters</figcaption></figure>



Britain’s new Prime Minister Keir Starmer said on Saturday he would scrap a controversial plan to fly thousands of asylum seekers from Britain to Rwanda in his first major policy announcement since winning a landslide election victory.



The previous Conservative government first announced the plan in 2022 to send migrants who arrived in Britain without permission to the East African nation, saying it would put an end to asylum seekers arriving on small boats.



But no one was sent to Rwanda under the plan because of years of legal challenges.



At his first press conference since becoming prime minister, Starmer said that the Rwanda policy would be scrapped because only about 1% of asylum seekers would have been removed and it would have failed to act as a deterrent.



“The Rwanda scheme was dead and buried before it started. It’s never been a deterrent,” Starmer said. “I’m not prepared to continue with gimmicks that don’t act as a deterrent.”



Starmer won one of the largest parliamentary majorities in modern British history on Friday, making him the most powerful British leader since former Prime Minister Tony Blair, but he faces a number of challenges, including improving struggling public services and reviving a weak economy.



At the press conference in Downing Street, Starmer answered about a dozen questions and was repeatedly asked about how and when he would start delivering on his promises to fix the nation’s problems, but he gave few specifics about what he planned.



Asked if he was willing to take tough decisions and raise taxes if necessary, Starmer said his government would identify problems and act in areas such as tackling an overstretched prisons system and reducing the long waiting times to use the state-run health service.



“We’re going to have to take the tough decisions and take them early, and we will. We will do that with a raw honesty,” he said. “But that is not a sort of prelude to saying there’s some tax decision that we didn’t speak about before.”



Starmer said he would set up and chair different “mission delivery boards” to focus on so-called missions or priority areas such as the health service and economic growth.



<h2 class="wp-block-heading" id="h-election-issue"><a></a>Election issue</h2>



The question of how to stop the asylum seekers crossing from France was a major theme of the six-week election campaign.



While supporters say it would smash the model of people traffickers, critics have argued the Rwanda policy was immoral and would never work.



Last November, the UK Supreme Court declared the policy unlawful, saying Rwanda could not be considered a safe third country, prompting ministers to sign a new treaty with the East African country and to pass new legislation to override this.



The legality of that move was being challenged by charities and unions in the courts.



The British government has already given the Rwandan government hundreds of millions of pounds to set up accommodation and hire extra officials to process the asylum seekers, money it cannot recover.



Starmer has said his government would create a Border Security Command that would bring together staff from the police, the domestic intelligence agency and prosecutors to work with international agencies to stop people smuggling.



Sonya Sceats, CEO of Freedom from Torture, one of the many organizations and charities which have campaigned to stop the Rwanda plan, welcomed Starmer’s announcement on Saturday.



“We applaud Keir Starmer for moving immediately to close the door on this shameful scheme that played politics with the lives of people fleeting torture and persecution,” she said.

108002009-17201812992024-07-05t115950z_1558437106_rc2zo8ashg9w_rtrmadp_0_britain-election

New UK leader Starmer declares Rwanda deportation plan ‘dead and buried’

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="547" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/VSUW65W5UVNKFHEP6AGCDDWLWI-820x547.jpg" alt="" class="wp-image-504288" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/VSUW65W5UVNKFHEP6AGCDDWLWI-820x547.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/VSUW65W5UVNKFHEP6AGCDDWLWI-300x200.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/VSUW65W5UVNKFHEP6AGCDDWLWI-135x90.jpg 135w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/VSUW65W5UVNKFHEP6AGCDDWLWI-768x512.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/VSUW65W5UVNKFHEP6AGCDDWLWI-1536x1024.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/VSUW65W5UVNKFHEP6AGCDDWLWI-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">FILE PHOTO: Kenya&#8217;s President William Ruto attends a joint press conference with Iran&#8217;s President Ebrahim Raisi at the State House in Nairobi, Kenya, July 12, 2023. Iran&#8217;s Presidency/WANA (West Asia News Agency)/Handout via REUTERS</figcaption></figure>



NAIROBI, July 5 (Reuters)&nbsp;&#8211;&nbsp;Kenyan President William Ruto on Friday pledged spending cuts totalling 177 billion shillings ($1.39 billion) in the fiscal year that started in July, after weeks of nationwide protests that forced him to scrap planned tax hikes.



The government will also increase borrowing by about 169 billion shillings to cover the 346 billion shilling hole created by the decision to withdraw the finance bill that was the original spark for the protests.



The demonstrations, which started peacefully before turning violent, have become the biggest threat to Ruto&#8217;s two-year-old presidency. Campaign groups have documented hundreds of arrests and at least 39 deaths linked to the government&#8217;s heavy-handed response, raising fears of rights backsliding.



Ruto said in a televised address to the nation that Kenya&#8217;s budget deficit was now projected at 4.6% of gross domestic product in the 2024/25 financial year, up from an earlier estimate of 3.3%.



Among ways his government will cut spending, Ruto said 47 state corporations would be dissolved, the number of advisors in government would be reduced by 50% immediately, and all non-essential travel by public office bearers would be suspended.



&#8220;Budget lines providing for the operations of the Office of the First Lady, the spouse of the Deputy President, and the Prime Cabinet Secretary, will be removed,&#8221; Ruto said, adding that public servants at retirement age of 60, shall be required to immediately retire.



He said there would be a forensic audit of the country&#8217;s debt and that he would also announce government changes soon.



($1 = 127.7500 Kenyan shillings)



(Reporting by George Obulutsa and Bhargav Acharya; Writing by Alexander Winning; Editing by Bate Felix)

Iran’s President Raisi visits Kenya

Kenya’s Ruto pledges spending cuts after nationwide protests

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="547" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-2159782737-820x547.jpg" alt="" class="wp-image-504193" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-2159782737-820x547.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-2159782737-300x200.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-2159782737-135x90.jpg 135w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-2159782737-768x512.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-2159782737-1536x1024.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-2159782737-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">NAIROBI, KENYA &#8211; JULY 02: Demonstrators, gathering in the city center, make a fire as they march towards the parliament building to protest the &#8216;Finance Bill 2024&#8217;, which envisages tax regulation in Nairobi, Kenya on July 02, 2024. Kenyan forces intervened against the protesters. (Photo by Gerald Anderson/Anadolu via Getty Images)</figcaption></figure>



NAIROBI, July 5 (Reuters)&nbsp;&#8211;&nbsp;Kenyan activist Bill Eugene Omollo was walking home after dark in his Nairobi neighbourhood on June 20 when he spotted trouble &#8211; two men eyeing him next to a parked white pick-up without number plates.



The 28-year-old had been involved in the youth-led protests that have upended Kenya since last month and had been released by police only hours earlier following his arrest at one of the demonstrations.



He shouted for help.



&#8220;But people were also running. So they took me,&#8221; he told Reuters.



Dozens of Kenyans have been targeted in similar abductions in the past two weeks, said human rights groups, who blame the extrajudicial arrests on Kenya&#8217;s intelligence services.



Organised online and leaderless, the protests &#8211; initially a call to repeal tax hikes &#8211; have developed into a movement that has cut across Kenya&#8217;s traditional ethnic divisions, becoming the biggest threat of William Ruto&#8217;s two-year-old presidency.



Though Ruto withdrew the tax increases in a victory for the movement, the heavy-handed reaction to the protests &#8211; campaign groups have documented hundreds of arrests and at least 39 deaths &#8211; has raised fears of rights backsliding.



&#8220;The president and I gave a categorical promise to the people of Kenya that the issue was abductions and extrajudicial killings will never happen again,&#8221; Deputy President Rigathi Gachagua said in a televised address. &#8220;Sadly, this is back.&#8221;



A police spokesperson did not respond to a request for comment on the abductions. Nor did Noordin Haji, the director of Kenya&#8217;s intelligence services.



In an interview on Sunday, Ruto denied police involvement in disappearances but broadly defended the actions of the security forces.



However, Irungu Houghton, executive director of Amnesty International Kenya, told Reuters there were clear cases of abuse.



&#8220;People who are considered to be protesters or organisers or even just simply voices of dissent are being plucked from their homes or even as they go to church with their families and locked up,&#8221; he said.



<h2 class="wp-block-heading" id="h-blindfolded-and-interrogated">BLINDFOLDED AND INTERROGATED</h2>



Amnesty, the Kenya National Commission on Human Rights and the Law Society of Kenya all put the number of abductions at more than 30, though they said most were later released.



Faith Odhiambo, the president of Law Society of Kenya, said the interrogations abduction victims have undergone during their ordeals have focused on how the protest movement is financed, how it is organised, and the identity of its leaders.



&#8220;It&#8217;s a very clear indication that the government is behind this,&#8221; she said.



After his aggressors bundled him into their vehicle, Omollo said he was blindfolded and driven to an unknown location where he was brought to a room and ordered to strip to his underwear.



He was forced to sit on the concrete floor, which his captors flooded with freezing water. Then the interrogation and threats to his family began.



&#8220;They asked me &#8216;Who sent you? Who is funding you?&#8217;. I told them no one is funding us,&#8221; said Omollo, who does not know who abducted him and has not reported the incident to the police.



&#8220;I thought I would be a dead man.&#8221;



<h2 class="wp-block-heading" id="h-the-missing">THE MISSING</h2>



Houghton said Amnesty had confirmed some instances of torture during the illegal detentions.



Odhiambo of the Law Society of Kenya said that if the goal of the abductions was to intimidate the victims, then it appeared to be succeeding.



&#8220;They don&#8217;t want to be seen on social media or any forums,&#8221; she said. &#8220;Fear has been instilled.&#8221;



After 24 hours, Omollo&#8217;s abductors loaded him back into their vehicle and left him near a police station.



He is among the lucky ones. The rights groups say a handful of abduction victims remain unaccounted for.



Nairobi resident Mutia Paul is still looking for his 17-year-old brother, Tony, who was last seen heading for a protest on June 25.



Paul has searched at police stations and hospitals. He has scoured the morgues for his body. He now believes Tony is being detained.



&#8220;My heart is full of sorrow, I have done all I can,&#8221; he said.



Activists have vowed to keep up pressure on Ruto and lawmakers. But Omollo told Reuters he has had enough of protesting.



Worried that he was being followed and could be abducted again, he has left Nairobi.



&#8220;I miss my home, I miss my brothers, I miss my sisters and I miss my community,&#8221; he said. &#8220;I feel like a refugee in my own country.&#8221;



(Additional reporting by Aaron Ross and Vivian Wandera; Writing by Olivia Kumwenda-Mtambo; Editing by Joe Bavier and Angus MacSwan)

Demonstration against tax regulation in Kenya

Kenya rights groups decry abductions as government cracks down on protests

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="547" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/42CTWLL6LJPYDHMYIWIJ6ISWHI-820x547.jpg" alt="" class="wp-image-503918" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/42CTWLL6LJPYDHMYIWIJ6ISWHI-820x547.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/42CTWLL6LJPYDHMYIWIJ6ISWHI-300x200.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/42CTWLL6LJPYDHMYIWIJ6ISWHI-135x90.jpg 135w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/42CTWLL6LJPYDHMYIWIJ6ISWHI-768x512.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/42CTWLL6LJPYDHMYIWIJ6ISWHI-1536x1024.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/42CTWLL6LJPYDHMYIWIJ6ISWHI-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">President William Kipchirchir Ruto of Kenya speaks during a plenary session of the Summit on peace in Ukraine, in Stansstad near Lucerne, Switzerland, June 16, 2024. URS FLUEELER/Pool via REUTERS/File Photo</figcaption></figure>



NAIROBI, July 4 (Reuters) &#8211; Kenyan President William Ruto spoke by phone with International Monetary Fund chief Kristalina Georgieva in the days after he withdrew $2.7 billion in proposed tax hikes in response to deadly protests, two diplomatic sources told Reuters.



The finance bill containing the tax increases was central to policy reforms agreed by Kenya with the IMF as part of a lending programme worth $3.6 billion.



Analysts say its withdrawal a week ago is likely to result in Kenya missing key programme targets.



The IMF has been a major target of the ire of young Kenyan protesters, who have accused it of being the driving force behind the proposed tax hikes.



The two sources, who spoke on condition of anonymity, did not provide details about Ruto and Georgieva&#8217;s phone call.



However, they said there was agreement among major donors that the IMF needed to show flexibility on programme targets as Kenya looked to fill the gap caused by the bill&#8217;s withdrawal.



The IMF reached a staff level agreement with Kenya in early June on a policy package needed to complete the lending programme&#8217;s seventh review, expected to unlock a disbursement of several hundred million dollars, but the deal has not yet received approval from the fund&#8217;s Executive Board.



An IMF spokesperson said: &#8220;We remain deeply concerned by the recent tragic events in Kenya and maintain close ongoing and constructive dialogue with the Kenyan authorities,&#8221; when asked about the call.



Ruto&#8217;s spokesperson did not respond to requests for comment.



Since shelving the bill, Ruto has pledged to include austerity measures in a supplemental budget, but has also suggested that the government will need to significantly increase borrowing in the 2024/25 fiscal year.



An IMF spokesperson said last week that its main goal has been helping Kenya overcome its economic challenges and improving its people&#8217;s well-being.



At least 39 people have been killed in the protests, according to a government-funded human rights organisation. Anti-government demonstrations have continued since Ruto pulled the bill, although with lower turnout.



(Additional reporting by Karin Strohecker; Editing by Alexander Smith)

Summit on peace in Ukraine, in Switzerland

Kenya president spoke to IMF chief after pulling tax hikes, sources say

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="573" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/RIXFSHFQNBMNVKPT4MGONQLT7M-820x573.jpg" alt="" class="wp-image-503885" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/RIXFSHFQNBMNVKPT4MGONQLT7M-820x573.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/RIXFSHFQNBMNVKPT4MGONQLT7M-300x209.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/RIXFSHFQNBMNVKPT4MGONQLT7M-129x90.jpg 129w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/RIXFSHFQNBMNVKPT4MGONQLT7M-768x536.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/RIXFSHFQNBMNVKPT4MGONQLT7M-1536x1072.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/RIXFSHFQNBMNVKPT4MGONQLT7M-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">Ethiopian Prime Minister Abiy Ahmed speaks in parliament during a session to approve the country&#8217;s 2024/25 budget, in Addis Ababa, Ethiopia, July 4, 2024. REUTERS/Tiksa Negeri</figcaption></figure>



ADDIS ABABA, July 4 (Reuters)&nbsp;&#8211;&nbsp;Ethiopia will receive $10.5 billion in support over the coming years if long-running negotiations with the International Monetary Fund and World Bank are successful, Prime Minister Abiy Ahmed said on Thursday.



In December, East Africa&#8217;s most populous country, struggling with high inflation and chronic foreign currency shortages, became the third on the continent in as many years to default on its debt.



Sources familiar with the matter previously told Reuters that Ethiopia was seeking to borrow around $3.5 billion under a reform programme with the IMF, while a Western diplomat said it was also trying to secure $3.5 billion in budget support from the World Bank and find another $3.5 billion in savings through debt restructuring.



Analysts say Ethiopia may need to agree to devalue its birr currency&nbsp;ETB=, which trades about 50% weaker than the official exchange rate on the black market, to secure IMF support.



&#8220;We have been having a wide range of talks, negotiations and discussions with the IMF and World Bank. Because we were a bit tough with them and they were also tough with us, the (talks) took five years,&#8221; Abiy told lawmakers.



&#8220;Now with the support of some friendly countries, it seems like many of our ideas have been accepted. If this succeeds and we are able to agree on the reforms, Ethiopia will get $10.5 billion in the coming years,&#8221; he said.



Abiy added that there were some reforms the government was unwilling to undertake right away, without elaborating.



&#8220;There are some areas we think should be reformed now, and there are things we think should stay as it is. If all these suggestions get accepted and we agree, there is an opportunity ahead of us. This reform agenda will play a huge impact in alleviating the debt burden,&#8221; the prime minister said.



(Reporting by Dawit Endeshaw; writing by Hereward Holland; editing by Alexander Winning and Mark Heinrich)

Ethiopia’s Parliament approves 2024/25 fiscal year budget

Ethiopia to get $10.5 bln if IMF, World Bank talks succeed, PM says

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="542" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-2155191891-820x542.jpg" alt="" class="wp-image-503797" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-2155191891-820x542.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-2155191891-300x198.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-2155191891-136x90.jpg 136w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-2155191891-768x508.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-2155191891-1536x1016.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-2155191891-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">Traffic drives down Sokoine Drive at dusk away from modern high rise buildings in the Ilala central business district in Dar es Salaam, Tanzania. (Photo by: Andy Soloman/UCG/Universal Images Group via Getty Images)</figcaption></figure>



DAR ES SALAAM, July 4 (Reuters) &#8211; Tanzania&#8217;s central bank left its key interest rate unchanged at 6%, it said on Thursday, adding that inflation expectations were well below target, the economy was growing strongly and exchange rate pressures were expected to ease.



The Bank of Tanzania introduced a benchmark interest rate in January as part of a new monetary policy framework, first setting it at 5.5% before raising it to 6.0% in April.



The bank targets inflation of 5%, but consumer inflation has stayed comfortably below that, coming in at 3.1% year-on-year in May.



In its latest Monetary Policy Committee (MPC) statement, the central bank said inflation was expected to range from 3%-4% in the second half of 2024.



&#8220;The MPC expects Tanzania&#8217;s economy to continue growing strongly, food supply to be adequate, and exchange rate pressures to moderate owing to increased foreign exchange inflows from tourism, gold, as well as cash crops and food,&#8221; the statement read.



Economic growth for the first and second quarters of the year was estimated around 5.0% and 5.4%, respectively, it said.



The current account deficit in the country of around 65 million people is estimated to have narrowed slightly to $959 million in the quarter ending in June, compared with $978 million in the corresponding quarter in 2023.



The improvement was driven by higher export earnings from gold and crops as well as tourism, the bank said.



Foreign exchange reserves remained adequate, above $5 billion at the end of June, sufficient to cover more than 4 months of projected imports, it said.



In the financial year that ended in June, the central bank bought 418 kg of gold to bolster its reserves and in the current financial year it intends to buy 6 metric tons of gold, deputy governor Yamungu Kayandabila told reporters.



(Reporting by Nuzulack Dausen; Writing by Hereward Holland; Editing by Alexander Winning and Emelia Sithole-Matarise)

Kivokoni Road and tall buildings Dar es Salaam, Tanzania

Tanzania central bank holds key rate, sees strong economic growth

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="558" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/6PQOLLEGFNICTCFEZK6NQXA3EI-820x558.jpg" alt="" class="wp-image-503524" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/6PQOLLEGFNICTCFEZK6NQXA3EI-820x558.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/6PQOLLEGFNICTCFEZK6NQXA3EI-300x204.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/6PQOLLEGFNICTCFEZK6NQXA3EI-132x90.jpg 132w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/6PQOLLEGFNICTCFEZK6NQXA3EI-768x523.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/6PQOLLEGFNICTCFEZK6NQXA3EI-1536x1046.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/6PQOLLEGFNICTCFEZK6NQXA3EI-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">Farmers harvest maize crop facilitated by the Safaricom DigiFarm App that helps agribusinesses and small holding farmers to share information and transact easily, in Sigor village of Bomet County, Kenya, May 28, 2020. REUTERS/Jackson Njehia/File Photo</figcaption></figure>



NAIROBI, July 3 (Reuters)&nbsp;&#8211;&nbsp;Kenya&#8217;s economy grew 5.0% year-on-year in the first quarter of 2024, down slightly from the 5.5% growth in the same quarter last year, its statistics office said on Wednesday.



Growth was driven by sectors including agriculture, forestry and fishing, real estate, financial and insurance, information and communication, and accommodation and food services, the Kenya National Bureau of Statistics (KNBS) said.



&#8220;Similar to the first quarter of 2023, agricultural production was vibrant in the corresponding quarter of 2024, owing to favourable weather conditions that supported crop and animal production during the quarter,&#8221; KNBS said in a statement.



Growth was also marginally higher in the fourth quarter of 2023, at 5.1% year-on-year.



(Reporting by Hereward Holland; Editing by Alexander Winning)

Farmers harvest maize crop facilitated by the Safaricom DigiFarm App that helps agribusinesses and small holding farmers to share information and transact easily, in Sigor village of Bomet County

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