Prices of fuel have increased again in Burundi.

The increase, the second in three months, follows the announcement made by the government last Thursday.

Speaking on television, the minister in charge of energy blamed the increase on external factors.

"Indeed, following the global economic situation, notably the fragility of a convalescent economy, the war in Ukraine, supply disruptions and geopolitical tensions that followed, the world prices of several products, including fuel, have increased significantly. The price of a barrel of crude oil on the international market rose from US$70.8 on 2 December 2021 to US$103.67 on 27 April 2022, an increase of about 47%", announced Ibrahim Uwizeye, Burundi's Minister of Hydraulics, Energy and Mines.

Two days after the annoucement, the consequences were visible on the ground.

As early as Saturday, long queues in front of petrol stations were visible in the capital, Bujumbura. 

Users came to fill up despite the price increase, to avoid the shortage.

"Today, it's fine because before, we used to spend several days on the waiting line, three or four days without being served. But in less than an hour, I get to the pump" said Burundian driver, Cyriaque Niyongabo.

Taxi drivers and transporters fear that this new increase will have an impact on their activity.

"The increase is very high. They are going up a lot. I ask that they lower it a little so that we, the transporters, can also work well and make a profit". (...) "Our customers complain a lot. They accuse us of taking advantage of the situation. But it's not us", complained taxi driver Alexis Ndihokubwayo.

Some service stations have run dry. Many vehicles are still waiting to be served. 

The last increase was at the end of January 2022. - Francine Sinarzi, Africanews

Nairobi Securities Exchange (NSE) has found itself in a crisis attributed to scarcity of US dollars in the forex market.

The EastAfrican has learnt that the bourse managers are concerned with the drop in supply of the US currency with fears that it could hit foreigners who control more than 50 percent of the daily trading activity on the stockmarket.

The latest development has been compounded by the Russian-Ukraine crisis which has injected negative shocks to the global economy with spillover effects witnessed in other economies, manifested mainly through commodity price hikes.

“Obviously it is not good for foreigners. I think one of the reasons why Kenya has been an attractive investment destination is that we have a liberal foreign currency regime where you can at least take forex in and out. So when you begin to have this kind of restriction it does affect the appetite of foreign investors in the market.

‘‘But we are hoping that this is temporary and with time the situation will improve,” said Paul Mwai, chief executive of AIB-AXIS Capital Ltd and vice chairman of NSE.

“If it persists it will affect the overall foreign investor appetite for the local market. Actually the bigger concern for foreign investors would be that the shortage could be a sign of a currency that is weaker and that is being restricted. So foreign investors are being affected because people are expecting that perhaps the Kenyan shilling should be depreciating against the dollar. But I don’t think the unavailability of dollars could be a long term problem,” added Mr Mwai.

Foreign investor activity at the Nairobi bourse fell to 54.88 percent in the three months to March from 57.73 percent in the three months to December 2021, according to data from the Capital Markets Authority (CMA).

According to the market regulator, NSE has historically recorded foreign investor participation in the range of 60 percent to 70 percent between 2019 and the first half of 2021.

“However, with increased global economic shocks, the market has suffered loss in its foreign investor participation levels in recent months with March 2022 recording the lowest level of 47.89 percent,” says CMA

“This reflects the risk posed by increased capital outflows calling for the Kenyan industry to be more strategic in increasing the profile of domestic investors in the country. This is what has enabled countries such as China and the US to remain resilient over the years.”

According to CMA, the Covid-19 pandemic, the uncertainty on the 2022 elections and the seemingly tough economic context pose key risks to steadying the recovery of domestic capital markets.

Kenyan manufacturers raised red flag over the shortage of the US dollars in the economy more than two weeks ago, arguing that the move is putting more pressure on the local currency, making imports expensive and fuelling more inflation. The Kenya Association of Manufacturers (KAM) said the dollar crunch has strained relations with suppliers, at a time competition for raw materials has intensified globally due to rising demand amid lingering supply chain constraint.

The Kenya Bankers Association confirmed the dollar shortage in the market, and advised customers to alert banks much earlier in cases where large amounts of foreign currency are required to allow the lenders to source the same from the market.

The industry’s lobby group attributed the dollar shortage to strong demand in the market as companies remit dividends and meet their overseas supplier obligations in the wake of the strong post Covid-19 recovery.

“However the supply of foreign currency continues to grow supported by receipts from the country’s main exports and strong remittances inflows.

‘‘This we believe will stabilise in due course and the market will revert to normal,” Habil Olaka, the association’s chief executive said in a statement last week.

“In the meantime, the industry is in constant discussion with the Central bank to ensure that the current imbalances are addressed as quickly as possible to bring the market back to normalcy,” added Olaka.

The National Treasury said it will be reviewing the currency composition of its external debt to reduce currency volatility that has seen the cost of its US Dollar denominated loans increase by two percent in barely four months.

National Treasury director-in-charge of Debt Management Haron Sirma told The EastAfrican that the proposal is aimed at reducing foreign exchange costs related to exchange rate movements.

“On the external debt stock, we seek to match the currency composition with the country’s foreign exchange holdings to the extent possible,” said Mr Sirma.

“The characteristics of a country’s external debt by currency should mirror the foreign currency inflows through exports, remittances etc.,’’ added Dr Sirma.

This minimizes forex costs through exchange rate movement.”

The Kenya shilling posted its lowest intraday level of 116.04 to the US dollar on Tuesday (April 26), according to data compiled by Bloomberg

Kenya borrows externally in five major currencies with the bulk of it (67 percent) being in the US Dollars.

Others are Euro (19 percent), Japanese Yen (six percent), Chinese Yuan (six percent) and Sterling Pound (two percent). - JAMES ANYANZWA, The EastAfrican

Thousands of unsuspecting Ugandans are counting losses after losing huge sums of money to online fraudsters masquerading as international business agents trading under chargeanytime.net purportedly from Malaysia.

The victims of the dubious business were lured into investing various sums of money through the various mobile money platform with the virtual company promising earnings up to about 35 per cent in daily interest rates running for 60 days.   

The clients, who are mainly in urban centers across the country include; businessmen and women, security officers, teachers and mobile money agents among others who would invest between Shs 20,000 and Shs 20 million through mobile money platforms before customized accounts would be created for them.  

According to the victims, when the business had just started in March this year, the clients would withdraw at most 80 per cent of their accumulated proceeds and earn a commission when they attract more clients onto the platform.

Franklin Jjingo, who lost Shs 3 million to the scam says that they woke up on Monday this week when the financial withdraws had been suspended before the online platform was completely closed down on Wednesday.

“We could directly communicate with the company directors through WhatsApp and Telegram channels. These would assure us that their business was not similar to other scams we have had before. But apparently, none of these people is accessible through any channels,” he said.

Besides one of the foreign directors only identified as Bart, Ddumba explains that the company also had recruited local business coordinators who would lure and recruit clients to invest on the platform. 

“I also informed several colleagues about this business who also joined, after seeing me withdrawing the profits,” Jjingo adds.

Patrick Sseremba, another unsuspecting client, who operates an electronic shop in Masaka town, says that he invested Shs 5 million with promises that he would recoup the in the initial 10 days, and accordingly continue earning profits. He says, before the platform closed on Monday, he had only recovered Shs 640,000.

“The guidelines were that you withdraw once in a day, and money would directly come to our mobile money accounts,” he indicates.

Upon inquiring from the company's foreign director, Sseremba says that he was informed that the ministry of Finance had ordered the company to suspend withdrawals until it studies its operations. According to the message the company sent out to the victims, at least 10,000 Ugandans had registered on its platform since March 29th this year and over a billion shillings had been collected from people's financial recharges.    

“…starting the initiative, we had a mission of giving financial growth to several individuals through online investment. Our efforts will go down in history as successful as we had so far gone 50% of our goals of empowering our clients. Bur for now, we apologize for the surprise suspension of our services from the country. We were informed by the government and summoned by the ministry of Finance to appear forth on matters concerning our operations, our legal team is working hand in hand with the government of Uganda to resolve the matter,” reads part of the message sent out to the victims from an apparently blocked WhatsApp contact using a Malaysian phone code +60. 

Jim Mugunga, the senior public relations officer in the ministry of Finance, Planning and Economic Monitoring told URN on Thursday that he was ignorant about the company operations in Uganda and the alleged summons. 

“We do not have any engagements with those people at the ministry, and I can’t tell how they are operating because the company name is so novel to me,” he said. 

A police officer at Masaka central police station who preferred not to be named confessed that he also lost Shs 800,000 to that scam in anticipation that he would use it to raise school fees for his children. 

He said they are now hunting for Samir Ajiga, the local company coordinator in the area, who introduced them to the business. He has since switched off his phone lines and his whereabouts remain unknown.  

“Many people here had joined and they are now silently suffering not knowing what to do next, but when we get this man we shall task him to produce his bosses,” the officer noted.

Ugandans are not new to online scammers. The most recent happened in February this year when close to 15,000 in the greater northern region lost an estimated Shs 10 billion in dubious forex trade in three months. - URN/The Observer