East Africa Economic Report

Dr. James Mwangi:  EquityBank Group CEO   S ix commercial bank groups in Kenya have resolved to lend to Micro and small enterprises, SMEs. The decision by the six, four of which are the largest banks in the country, will have a significant impact on credit to SMEs. This marks the beginning of a major price war that could benefit the borrower.  Equity Bank group shot the first volley:  It set aside US$1.5 billion to lend to the sector of the economy at 13 percent per annum probably through its EAZZy app. Soon thereafter, a consortium of five indigenous banks launched Stawi, a mobile phone app to lend to the sector amounts ranging from US$300 to $2,500.  The consortium targets some 10,000 applicants this year, which means that at least an additional US$25 million is available for the SMEs to borrow. It is not clear how much Equity will lend per customer, but given the size of its war chest, it could lend more. The consortium includes; Commercial Ba...

A prototype of the Mombasa  - Nairobi Expressway Kenya is the pioneer in Public-Private - Partnerships, PPP, in East Africa with a total PPP investment estimated at $6.4 billion already committed. Of these, an estimated $2 billion is already invested in the energy sector. The balance, an estimated $4.2 billion will be sunk into roads construction.   Public-Private- Partnerships are the provision of public services by the private sector for a fee. The private investors charge a toll in case of roads or sign PPAs with the national distributor in case of electricity. Investors sign a 25-year concession during which period they recoup their investment plus profit as they operate the projects they build. All the contracts in the energy sector are on a Build Own and operate (BOO) model while the in road construction contracts are on Build Operate and Transfer (BOT ) model. PPP projects are spread across the country in a strategy designed to ensure equitable development....