1. NAIROBI, Kenya: Cost of living remains high for Kenya's urban poor despite significant fall in inflation
By Bedah Mengo
Aug. 2 (Xinhua) -- The urban poor in Kenya are still finding it difficult to afford basic items despite a significant drop in inflation, which indicates that the cost of living has come
The going is tough for many low-income families. Inflation, according to Kenya National Bureau of Statistics (KNBS) in data released on Wednesday, has dropped to 7.74
percent in July. This decrease in month-on- month inflation was a 17-month low, having dropped from 10.05 percent in June. KNBS attributed the low inflation rate to
considerable drop in prices of food items, which are the key contributor of cost of living."Food and non-alcoholic drinks index decreased by 1.88 percent between June and
July. This was mainly due to continued fall in prices of several food products such as sukuma wiki (kales), milk, potatoes, tomatoes, cabbages, onions, beans, green maize and
spinach," said KNBS.
Similarly, the institution noted that prices of electricity, cooking gas and kerosene, which is mainly used by low-income families, had declined."Housing, water, electricity, gas
and other fuels' index decreased by 0.22 percent mainly on account of reduced costs of electricity, kerosene and cooking gas," said KNBS. The drop in inflation to a single-digit
may be good news to government technocrats and some high-income earners, who now have more disposable income, but for the urban poor, little has changed in terms of
cost of living."Prices of many things are still unaffordable. Life is still as difficult as it was when inflation was at 19 percent," Kunyu Juma, a resident of Korogocho, a slum
district on the east of Nairobi, said on Wednesday.
Juma, a father of four, recounted that he can barely afford three meals for his family."Most of the times we do not eat lunch. On good days, the children drink porridge, which
we cook in plenty in the morning. They then drink it at lunch time if it remains," said Juma.Juma, who works at construction sites in the capital, isolated maize, milk, bread,
sugar and meat as some of the items whose prices are unaffordable."I do not remember the last time my family had milk tea with bread for breakfast. Milk, bread and sugar
prices are high. Milk and bread cost more than a dollar. How do you buy them every day and still afford to cater for other needs?" he posed.
A 400g loaf of bread in most parts of the East African nation retails at 0.55 U.S dollars. Bread prices jumped from about 0.42 dollars in January to the current cost, with
processors blaming it on scarcity of wheat especially in the international market.Similarly, a 500ml packet of milk current costs 0.53 dollars, from about 0.35 dollars in
January. Processors have attributed the high prices to milk shortages.On the other hand, a 2kg packet of maize flour in various parts of Kenya retails at an average of 1.38
dollars. Prices jumped from 1.07 dollars in January.
Due to the high cost, most low-income earners opt to buy dry maize, which they process at posho mills.A 2kg tin of dry maize is being sold at 1.19 dollars. One then uses 0.13
dollars to process the maize into flour. "This is cheaper when compared to buying a packet of maize flour but generally, the cost of maize is high," said Juma. The high prices,
according to the labourer, have made him avoid eating corn meal every day. "Sometimes we substitute maize meal with Irish potatoes. The latter are cheaper because they
are now in season," he said.
Juma noted that life is unbearable for most low-income earners despite the drop in inflation. "We are feeling the pinch of high cost of living because we not have money to
buy things in bulk. I buy two 2kg tins of maize after every four days. Most of the times I find prices have appreciated. This means I pay money for the commodity than if I was
buying in bulk," he said. Bernard Kimani, a resident of Kayole, a low-income area in the capital, said that to cut costs, he buys food from street."Sometimes it becomes
cheaper to buy food on the street than prepare meals in the house. For instance, during lunch hour, I buy githeri (mixture of beans and maize) worth 0.47 dollars, which is
better than spending twice that amount of preparing food at home," he said.
Other items, whose prices are still high, according to Kimani are transport costs and rent. "Cost of commuting has not dropped despite decrease in prices of petrol and diesel.
On the other hand, our landlord has given us notice that he will raise rent to cushion himself from tax payments. To me inflation has not dropped," he said. The Central Bank
of Kenya (CBK) notes that the government targets to bring down Kenya's inflation to 5 percent. Low and stable inflation rate, coupled with adequate liquidity in the market
promotes domestic savings and private investment, according to the bank, leading to improved economic growth. (Xinhua)
2. KINSHASA, DRC: UN calls for economic diversification in Africa
Aug. 2 (Xinhua) -- Agro-industry and economic diversification are the best ways for Africa to achieve prosperity, the director general of the United Nations Industrial
Development Organization (UNIDO) has said.
"Agriculture is the most important African economic sector and it's this sector that will enable the continent to get out of poverty. Agriculture employs 65 percent of the active
population and represents 75 percent of the internal trade," Kandeh Yumkella told the press on Wednesday. He was speaking in Kinshasa during a meeting with African
finance ministers, directors of national central banks and representatives of development agencies. "Africa is equally experiencing rapid urbanization. In order to transform
these promising prospects into job creation opportunities for the young people, Africa should diversify its economy," he added.
Yumkella pointed out the need to reinforce the continent's agricultural productivity to guarantee sustainable development of agro-industry, with the ultimate objective of
creating wealth and jobs. "The capacity of transformation of agricultural raw materials into industrial products will depend more and more on the African entrepreneurs and
their willingness to respond to the competition at the local, regional and international level. The African industry should therefore adapt to the changing market trends,
constantly improve its efficiency and start to think of future consumer needs in a global economy," Yumkella said.The director general urged African countries to invest in
strategic sectors such as the infrastructure, transport, energy and Information and Communication Technologies (ICT), to promote the development of agro-industry.
3. NAIROBI, Kenya: Kenya leader woos British investors
Aug. 2 (Xinhua) -- Kenyan President Mwai Kibaki returned to the country early on Thursday from an official visit to Britain where he lobbied for increased investments to the
East African nation.
During his visit, Kibaki who addressed the Kenya Investment Conference called on British investors and others from across the world to take advantage of the existing
lucrative investment opportunities in Kenya. He said since 2003, Kenya's economy has been on an impressive growth path, noting that the past decade has been one of the
most prosperous periods Kenya has ever enjoyed. "We are therefore inviting you to be part of our success through investment, trade and tourism," he said according to a
statement issued upon his arrival in Nairobi.
The President thanked investors for availing themselves to receive firsthand information on the wide range of investment opportunities available in Kenya during the
Investment Conference that was held during the day adding that he looked forward to increased investments in Kenya as a result of the Conference. "It is our hope that you
now have sufficient information to enable your respective boards and senior management make decisions in favor of investing in our country," he said. The East African
nation is seeking to attract at least 2.14 billion U.S. dollars in foreign and local investments for the 2012/ 2013 financial year.
Acting Managing Director of Kenya Investment Authority (KIA) Julius Korir said early in July that Kenya attracted close to 1.78 billion dollars in foreign and domestic
investments in the last financial year which ended in June."For the 2012/ 2013 financial year, we have set a target of total domestic and foreign investments of at least 2.14
billion dollars in order to make Kenya, a regional economic hub for Africa, " he said on July 9.During the conference, Kibaki outlined measures that have been put in place to
create a conducive investment environment in the country including the enactment of the new Constitution and the massive infrastructure development across the country.
The Kenyan leader also assured investors of a smooth leadership transition after the general election that will be held next year. "Kenya is due to hold its next general election
early next year. I would like to assure all investors that there will be a smooth handover of power to the next government," he assured. Kenya attracted investments worth
470 million dollars in the first half of 2012 largely from foreign investors, according to data from the Kenya Investment Authority (KenInvest).Most of the investments came in
the first quarter of the year ending March, totaling 376 million dollars, said the state investment agency said. The investment in the first quarter was near similar in value to
the investment in the similar period of last year, the agency said.
According to the statistics, a total of 57 project proposals of diverse nature and spread across main economic sectors were received by the agency during the first half of the
year, the data showed. The first quarter had 34 project proposals with potential to create 2,812 employment opportunities for Kenyans and 235 opportunities for
foreigners.KenInvest is also expected to launch an online platform next month that will enable prospective investors make their proposals online, get approval or rejection
and the necessary licences online. The platform is part of launching a one-stop-shop where investors can get all the required licences at one location. Currently, investors have
to visit more than ten agencies to obtain necessary licences.The new platform is expected to increase efficiency in proposal evaluation and licencing of businesses enabling
investors to set up faster than they currently do, making it easier to do business in Kenya. (Xinhua)
4. LUSAKA, Zambia: Zambia plans its first motor assembly plant
Aug. 2 (Xinhua) -- Two local firms have partnered in a business venture to establish a motor assembly plant in Zambia, the Times of Zambia reported on Thursday.
Savenda Management Services and Savenda Africa Holdings Limited have signed a memorandum of understanding to establish the plant at a cost of 1.3 billion U.S. dollars.
Savenda Group Director, Clever Mpoha said his company and its partners had planned to establish a motor assembly plant for 4, 000 trucks and the assembly of Savenda
Roller Packs (compactors)."This partnership collectively will create well over 8, 000 jobs and we are established to manage this process very well because of the economic
benefits," he was quoted as saying by the paper. (Xinhua)