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Daily briefing - 10 September 2019

Equity Bank continues to expand across Africa with chief executive James Mwangi announcing that Equity will acquire a controlling stake in the Commercial Bank of Congo which is being re-branded as Equity Bank Congo. "The Congo subsidiary is the most profitable in the region," reports Business Daily. "Access to banking services in the resource-rich nation is low compared to other countries in Sub-Saharan region. About 90 per cent of the population is unbanked. 'The Proposed Transaction is an opportunity for EGH to deliver the vision of building sub-Saharan Africa's premier financial institution through delivering innovative products and services to customers, including, in particular, the effective use of technology,' Mr Mwangi said." Kenya-based Equity Bank earlier this year took over the operations of Atlas Mara in Zambia, Mozambique, Tanzania and Rwanda.

Is the Bank of Spain helping Venezuela to mitigate the sanctions imposed by the United States? It certainly appears so. Why would anyone defy the United States when it comes to moving dollars around? That, dear readers, is beyond the scope of the Daily Briefing but we invite you to make your own guess. Bloomberg claims that two people connected with the central bank have said that it is assisting Venezuela to route payments in order to pay contractors. "Venezuelan central bank officials are telling contractors that going through the Bank of Spain is an option to make and receive payments outside of the country, while warning that it may still take at least a month to clear transactions due to increased scrutiny, one of the people said. In an emailed statement, a Bank of Spain spokesman said the account kept by Venezuela is used to pay operating expenses related to the diplomatic relations between the two countries and by international organizations to send funds to Venezuela since they can't use commercial banking channels. The balance of the account is 'relatively small and has not registered significant variation in the past year,' according to the statement."

While agriculture in Europe and the USA remains largely a corporate affair, in Africa it is the SME sector that is investing in agriculture and small farmers. It's what Agnes Kalibata, President of the Alliance for a Green Revolution in Africa, calls the 'hidden middle'. "SMEs are the biggest investors in building markets for farmers in Africa today, and will likely remain so for the next 10-to-20 years," said Dr. Agnes Kalibata, according to africafeeds.com. "They are not a 'missing middle,' as is thought, but the 'hidden middle,' ready for support and investment to thrive further. Today, we bring them out into the light.' In terms of the actual value, AASR finds that traders, truckers and processors constitute about 40 percent of the total gross value of the agri-food system in the region - this is the same as the share coming from farms. Retailers constitute the remaining 20 percent. The report also notes that corporates play a minor role in African agriculture. It further notes that rural farmers spend about 40 percent of their time farming, and the other 60 percent on related activity.

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