Private equity Phatisa buys ‘significant’ stake in General Plastics

A private equity fund, Phatisa has bought a major stake in General Plastics (GPL), a Nairobi-based family business specializes in manufacture of packages for food, beverage, cosmetics and agro-chemical companies. General plastics, which was founded in 1977, and currently has 900 employees, manufactures packages for Bidco Oil Refineries, InterConsumer Products (acquired by French firm L’Oreal), Pz Cussons, Excel Chemicals, Kenya Shell (Vivo), Menengai Oil and Unilever. Phatisa intends to use funds raised from the deal to expand its packaging products, as foreign interests in Kenya’s consumer sector continues to grow. Phatisa has invested in General Plastics through African Agriculture Fund, a 10-year fund that invests in agribusinesses and companies that support them [...]

Real-time bank transfer payments reach Sh26 trillion

Kenya Electronic Payment and Settlement System (KEPSS) handled Sh25.6 trillion in the year 2014 compared to Sh22.7 trillion previous year. KEPSS, which runs the real-time gross settlement (RTGS) system, started operations in July 2005 and was hosted by the Central Bank to assist in cutting the cost of handling cash and reduce the incidences of fraud where high-value cheques were involved. Last year, 10,000 transactions were cleared per day with an average settlement of Sh100 billion daily. This could be due to increased public awareness and uptake of the system which was introduced to ease business transactions. KEPSS platform interconnects 41 out of 44 local commercial banks in Kenya and reduces the amounts of money CBK reduce spends on printing currency [...]

Economists project further shilling fall

The shilling may grow weak due to a widening current account deficit and rising debt level as the US dollar strengthens against other world currencies. Currently, the shilling is exchanging at 91.66 to the dollar and may weaken further to as low as 94.50 against the dollar. This weakening of the shilling could be attributed to reduced inflows from tourism and agriculture and a rising import bill, especially on capital goods necessary for the increased infrastructure development. The Central Bank may be able to loosen its monetary policy due to lower oil prices which have led to a drop in inflation. Easing the monetary policy too quickly with limited reduction in current account deficit may weaken the shilling while on the other hand, fiscal spending still remains high. An advantage of a weakening shilling is reduction in the appetite for imported consumer goods since importers will pay using the dollar while an encouragement to exporters who get paid using in the dollar [...]

Tax on keg beer cuts sorghum prices by 80pc

Tax remission on Keg beer was halved from 100 per cent reducing the thrift of EABL business segment and sorghum farming. Treasury introduced the 50 per cent excise tax on the keg beer in the 2013/2014 Budget as it argued beer drinkers had shifted to the alcoholic drink due to the low prices yet the exchequer was not benefiting. Kenya Producers Coalition, an NGO working with farmers, argues that increasing the excise duty on keg beer reduce the prices of sorghum to the detriment of farmers who cannot support themselves on the proceeds they receive currently [...]

Indian retailer AaramShop targets Kenya in growth plans

An Indian online retailer, AaramShop, plans to expand to Kenya in partnership with local players. The retailer allows kiosks and consumer goods companies sell products through its site. It then makes money from advertising and through analytics generated from its site it charges consumer goods companies. Customers can buy the goods through their mobile phones or online and have them dropped at their offices or homes. Payment is on delivery. The company plans to use a franchise model to expand into new markets, for instance, Nairobi in East Africa, Vietnam and Indonesia in South-East Asia and the UAE [...]