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Covid-19 Pushed Kenya Airways Into U$333million Loss

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Business for East Africa’s largest airline company Kenya Airways has reported a gigantic loss amounting of almost U$300million attributed to the impact of Covid-19 pandemic.

According to the state carrier it made a total loss of U$ 333181610.82(Sh36.6 billion) after tax loss for the financial year ending December 2020 compared to Sh12.9 billion loss in 2019.

The loss exceeds the amount of money allocated to Kenya’s six counties combined in the Financial Year 2019/2020.  

The financial year under focus was the worst in the history of the aviation industry. Airline passenger traffic was reduced to levels last seen in 1999, wiping out 21 years of airline passenger traffic growth.

During the period, Kenya Airways shut down its scheduled network operations from April to July last year following a directive from the government to suspend all scheduled passenger services into and out of the country to curb the spread covid-19 virus.

“It has been a tough year where we have faced unprecedented challenges. The situation continues to be difficult even as we gradually resume our operations, mainly due to the depressed demand for air travel, with recovery to 2019 levels expected to take between 3 to 4 years,” said the airline in a tweet.

The Group’s total revenue during the year reduced by 58.8% to Sh52.8 billion as a result of reduced flight capacity aligned to depressed demand.

Approximately 70% of total passengers carried last year were flown during the first three months of the year, demonstrating the drop in demand as the global crisis deepened during the year.

Passengers uplifted in the year amounted to 1.8 million, a reduction of 65.7% from prior year.

Similarly, passenger revenue declined by 67.5% from Sh103.6 billion reported in 2019 to Sh33.7billion reported last year evidencing the continuing effect of the pandemic.

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Germany, Rwanda Sign Rwf90B Financing Agreement

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Finance Minister, Dr. Uzziel Ndagijimana, and the Germany Ambassador to Rwanda, Dr. Thomas Kurz, today signed two agreements worth € 78 million (Approximately Frw 90 billion).

The financing and technical cooperation agreement is the outcome of the Inter-Governmental Negotiations that were concluded last Year between our two respective Governments.

59 million Euros of the grant agreement will be provided through KFW Development Bank and will support various initiatives including technical and vocational training, promotion of export oriented SMEs, through the support to Export Credit Facility in Rwanda under BRD, promotion of green investments as well as ICT support.

The remaining Euros19 million will be channeled through GIZ and will support decentralization and good governance, prevention of sexual and gender based violence among others.

Speaking after the signing event, Minister Ndagijimana said the financial support extended to Rwanda will support key areas that are critical to the attainment of the country’s development objectives.

“This support comes at a critical juncture given the effects COVID-19 has had on our social –economic advancement. We look forward to boosting these important areas that are in line with our National Strategy for Transformation. We thank Germany for the strong cooperation and solidarity especially during the COVID-19 pandemic,“ Minister Ndagijimana said.

Ambassador Kurz stressed: “These Agreements underline the long-standing and proven cooperation between our two countries based on friendship and mutual trust. Germany is committed to support Rwanda in its Economic Recovery Process and the implementation of NST 1 in order to reach the SDGs and to leave no one behind.”

The Division of Labor allows Germany development cooperation programme to be active in Education (including TVET); Decentralization and Good Governance, Private Sector Development and Youth; Public Financial Management (PFM); Financial Development. Germany also supports Regional Projects: Centre of Excellence for Health, Improvement of the Investment Climate, Microfinance sector-MIFSSA, ICGLR and Energy.

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Malawi Issues 86 Licenses For Cannabis Production

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Malawi’s Cannabis Regulatory Authority said on Friday they had issued 86 licenses to 35 companies and cooperatives to venture into cannabis cultivation for industrial hemp production.

Boniface Kadzamila the Board Chairman of Cannabis Regulatory Authority made the announcement from Lilongwe on Friday afternoon.

He said that a total of 41 companies applied but only 35 of them satisfied the requirements.

According to him the authority has issued licenses for cultivation, processing and storage and has not yet issued any license for export of cannabis.

A recent analysis by Invegrow Limited, one of the firms that conducted research on industrial hemp, found that a kilogram of industrial hemp could fetch U$1,444 on the market that there is potential for direct annual benefit for Malawians in excess of U$ 135,440,973 on 16.5 hectares or U$8,803,663 per five hectares.

The analysis further indicated that the crop has ready markets whose global value chain is worth U$9billion thus giving local Malawi investors a basis to take up cannabis production.

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ex-Nakumatt CEO’s Home Auctioned

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Atul Shah, the former chief executive officer of the collapsed retail giant Nakumatt lost his home to auctioneers over a U$18,609,740 debt.

The auction follows the conclusion of a protracted court battle after the Kenyan High Court dismissed a petition seeking to overturn the forced sale of the high-end property by KCB Group.

Justice Francis Tuiyott dismissed the petition by the administrator of the collapsed Supermarket chain, saying it has no chance of success.

Nakumatt’s court-appointed administrator had opposed the sale on grounds that the auction failed to follow the law, and tagged Mr Shah as an interested party to suit.

The bank, through Leakey Auctioneers, early in the year quietly sold the property, which Mr Shah had used as additional security as Nakumatt’s guarantor to offer comfort to the multiple bank loans.

“This court is not persuaded that the suit, as currently presented, demonstrates a prima facie case with a probability of success. Being unable to surmount that hurdle, it is needless for this court to discuss other aspects raised in the application,” the judge said.

KCB had earlier sold Mr Shah’s prime property in Industrial Area, Nairobi, to Furniture Palace International Ltd for about U$9,677,064 court records show.

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