NAIROBI, Feb. 25 (Xinhua) -- The value of coffee exports from Kenya rose 17.4 percent in 2021 while tea earnings remained flat despite an increase in the quantity shipped out, the national statistician said in an economic report Friday.

The Kenya National Bureau of Statistics (KNBS) said the country exported coffee worth 26.1 billion shillings (about 229 million U.S. dollars) in 2021, up from 195 million dollars in 2020.

The quantity of coffee exported during the period stood at 37,477 metric tons (MT), a decrease from 43,386 MT in 2020, with the rise in earnings, indicating better prices in the global market that averaged 6.3 dollars, up from 5.9 dollars, according to KNBS.

KNBS said the earnings from tea stood at 1.15 billion dollars in 2021, a marginal rise from 1.14 billion dollars in 2020.

During the period, the quantity of tea the east African nation exported stood at 556,459 MT, down from 575,282 MT in 2020.

The Tea Board of Kenya attributed the declined production to unfavorable weather conditions experienced in the country for the better part of 2021.

Pakistan, the United Arab Emirates (UAE), Russia, Egypt and Sudan are Kenya's main markets.

For coffee, the east African nation is the fifth largest producer in Africa after Ethiopia, Uganda, Ivory Coast and Tanzania, according to the International Coffee Organization. - Xinhua

Uganda is considering a Central Bank Digital Currency (CBDC) in a move that has drawn policy attention to the large investments required for a successful trading ecosystem and crucial mileage offered by digital payments systems such as mobile money services and internet banking.

Whereas the actual cost of issuing a government-owned digital currency remains unclear, the costs surrounding this venture are reflected in the development of software tools, improved electricity generation for running high energy consuming block chain technology platforms, and recruitment of specialist personnel. Implementation timelines are yet to be confirmed.

“We are studying the idea of a Central Bank Digital Currency with the aid of case studies developed by peer central banks in Jamaica, Nigeria, Ghana and Kenya among others. The law does not accommodate digital currency use in Uganda but we are exploring legal options for future amendments in financial laws that will facilitate circulation of digital currency denominations.

"The dominant youth segment is a plus for introduction of a digital currency because it fits into their tech savvy behavioural patterns. Digital currencies rely a lot on blockchain technology, which creates a big investment burden on its ecosystem in form of human resources like data scientists. The rollout of a digital currency in Uganda will be anchored on execution of high value financial transactions that may be processed at a cheaper cost on a blockchain platform compared with the Real Time Gross Settlement System and mobile money platforms,” said George Wilson Sonko, a performance measurement analyst at the Bank of Uganda.

“The previous rollout of mobile money services that depend on digital wallets has levelled the ground for a future digital currency and that means less resistance from the local population. The biggest risk posed by digital currencies in developing economies lies in high frequency transactions by market players with little scrutiny and are not backed by physical cash,” said Fred Muhumuza, a local economist. - BERNARD BUSUULWA/JAMES ANYANZWA, The EastAfrican

NAIROBI, Jan. 29 (Xinhua) -- Kenya's foreign exchange reserves fell a record 49 billion shillings (about 428 million U.S. dollars) this week as the shilling hit a new low amid strong dollar demand from importers.

The Central Bank of Kenya (CBK) said in its weekly update of the financial markets released Friday evening that the reserves fell from 8.715 billion dollars to 8.287 billion dollars, a new low.

During the week, the shilling declined to exchange at 114 against the dollar, down from 113, with the CBK reportedly using part of the reserves to support it.

A higher demand for dollars from importers to meet their end-month needs further put pressure on the forex reserves.

Despite the sharp decline, however, the CBK said the forex reserves remain adequate and continue to provide cover and a buffer against short-term shocks in the foreign exchange market. The new reserves cover 5.07 months of import cover, down from 5.33 months of cover.

"The usable foreign exchange reserves remain adequate. They meet the CBK's statutory requirement to endeavor to maintain at least four months of import cover, and the EAC region's convergence criteria of 4.5 months of import cover," said the apex bank.

On Thursday, CBK governor Patrick Njoroge said inflows from east Africa's major exports like tea declined in 2021, amid a rise in imports, thus, putting pressure on forex reserves.

The value of imported goods rose 25 percent in 2021 compared to a decline of 12.4 percent in 2020, reflecting an increase in oil and intermediate goods imports, said Njoroge. - Xinhua