Blog - Afrikan Heroes

We Are Improving Revenue Generation Outside Natural Resources — Samuel Jibao

September 19, 2019

Dr Samuel S. Jibao, Commissioner-General of the National Revenue Authority (NRA) is an accomplished economist cum researcher whose area of interest is Public Economics with special focus on Taxation. As the helmsman of the NRA in the past one year, he has brought unprecedented transformation to the Authority. In this interview, Jibao speaks on the ongoing reforms in the NRA and their impact on trade and economic growth in Sierra Leone. Excerpts:

HOW would you describe the contributions of NRA to the economy of Sierra Leone?

Any decisive government has to envision financing its public expenditure primarily from domestic revenue rather than depending on the unpredictable and conditional donor funding. While donor funds still has a strong presence in the Sierra Leonean budget, domestic revenue contribution has been on the increase since the inception of the present administration in 2018. In that year, total receipts (domestic revenue and grants) rose to73% of the government budget from 62% the previous year; of which domestic revenue was 64% of total government budgeted expenditures (compared to 52% in 2017).

***Dr Samuel S. Jibao, Commissioner-General of the National Revenue Authority***

This implies that NRA’s contribution to financing the public budget has enhanced economic growth and reduced poverty through increased government spending in public infrastructure and human capital. By mobilising more revenue, the fiscal space for government to spend more in pro-poor sectors is enhanced. It is noteworthy that the function of the NRA is not limited to revenue mobilisation. Indeed, the reforms at the Customs Service Department through the implementation of an easy-to-use and more transparent ASYCUDA World system and its associated functionalities in January this year has made the clearance process easier and transparent, thus reducing cost to importers and facilitating trade.

The recent reforms which enable the Customs Service Department to operate on weekends and extend the banking hours have further helped facilitate trade since importers now have more time to clear and pay for their goods. This, indeed, has boost trade expansion and economic growth in the country.

Tax evaders normally channel their monies to tax havens. What measures are in place to stop them from avoiding paying taxes?

Despite the fact that many multinational corporations partake in stock exchange, some of them evade taxes. Base Erosion and Profit Shifting (BEPS) is one of the avenues that multinational companies have been using as tax planning measure to avoid paying taxes. In Africa where accessing information on the operations of such international companies is hard, it is difficult to tackle such practices. However, the African Union and the Africa Tax Administration Forum (ATAF) have been working to enhance the capacity of the region to tackle such practices. In Sierra Leone, we have signed up to the OECD’s Inclusive Framework on BEPS, which helps member-countries to collaborate on the measures to tackle tax avoidance, improve the coherence of international tax rules and promote a more transparent tax environment.

In addition, Sierra Leone through support from OXFAM and ATAF is on the verge of drafting a Transfer Pricing Regulation that will consolidate separate provisions of Transfer Pricing in different legislations and ensure the country has a reference document as a Transfer Pricing Regulation to handle transfer pricing attempts by multinational companies. We have also received approval from the Tax Inspectors Without Borders secretariat for experts in audits including transfer pricing audits to build the capacity of our tax auditors and provide hands-on support in complex audits especially of international transactions.

Recently, government took a strong stance on controlling and monitoring repatriation of proceeds from economic activities in Sierra Leone to other countries. Collaboration, both domestically and internationally, is usually the preferred option to handle such practices. In this regard, the NRA is on the verge of signing an MOU with the Financial Intelligence Unit (FIU) to exchange information on financial intelligence including that on Multinational Enterprises (MNEs). Related to that is the recent collaboration between the NRA and FIU to strengthen currency declaration administration at the airport. Our next step is to sign up to the automatic exchange of information platform, which is crucial for tracking evaders.

Given the level of the informal economy, what is being done to expand the tax base?

In Sierra Leone, just as in many developing counties, the informal sector is quite large, therefore, getting them into the tax net helps in considerably expanding the tax base. The NRA is cognisant of this and has been working in several fronts to expand the tax base so as to boost domestic revenue.

Currently, the Authority is gathering data of registered businesses from several third party sources with a view to matching that information to identify taxpayers/businesses that may not have been registered with the NRA and, subsequently, get them registered. Going forward, the Authority has signed MoUs with various government agencies charged with the responsibility of registering businesses even as we intend to sign more.

Secondly, after the conclusion of the current Taxpayer Identification Number (TIN) verification, the NRA hopes to encourage voluntary registration of businesses into our taxpayer database at designated centres across major cities of the country. Once, this period expires, the Authority, with support from the Ministry of Finance, will undertake a nationwide block registration or business census, to identify any other businesses or potential taxpayers that may not have been verified or voluntarily registered, by going street-by-street or block-by-block to identify those without the NRA verification stickers affixed at their premises showing they have been registered. With this census or block registration exercise, we hope to get most, if not all, establishments into the NRA tax register, hence, expand the tax base.

Interestingly too, the country recently signed a grant support with the African Development Bank (AfDB) to implement a tax compliance enhancement project, including the implementation of a Domestic Tax Preparer(DTP) scheme to support the record keeping and returns filing abilities of SMEs with a view to formalising their operations and expanding our taxpayer base

Kelechi Deca

Kelechi Deca has over two decades of media experience, he has traveled to over 77 countries reporting on multilateral development institutions, international business, trade, travels, culture, and diplomacy. He is also a petrol head with in-depth knowledge of automobiles and the auto industry.

BFA Becomes First Angolan Bank to Sign on to Afreximbank’s Trade Facilitation Programme

As part of efforts to expand its facility across the African continent, African Export and Import Bank (Afreximbank) has signed a Trade Facilitation Programme worth $50 million with the Banco de Fomento Angola (BFA). With this development, the BFA becomes the first Angolan financial institution to sign up to Afreximbank’s Trade Facilitation programme (AFTRAF) for an initial $50-million line of credit.

Dr Benedit Oramah, president, AfriExim Bank

The AFTRAF was instituted with the aim of supporting African banks to bridge the gap created by the withdrawal of international correspondent banks from the continent. Thus the BFA will use the AFTRAF line of credit to confirm letters of credit and to issue guarantees, avalisation and other trade enabling products, said Afreximbank in an announcement in Cairo today. The line could also be increased based on demand from the Angola market.

According to Afreximbank, the AFTRAF programme provides access to a global network of confirming banks and complements the capacity of African banks to provide trade financing solutions by providing risk mitigation in new or challenging markets where trade lines may be constrained.

The AFTRAF programme is expected to help African importers and exporters to increase their trade volumes with African counterparties and internationally and to enhance confidence in the settlement of international trade transactions for critical imports into Africa while ensuring access to trade finance at reasonable cost.

So far, 100 Banks from 26 Afreximbank member countries have signed on to the AFTRAF

The signing of the AFRAF facility by BFA is part of ongoing cooperation between Afreximbank and BFA as both are actively engaged in other areas in support of the Angolan economy.

Kelechi Deca

Kelechi Deca has over two decades of media experience, he has traveled to over 77 countries reporting on multilateral development institutions, international business, trade, travels, culture, and diplomacy. He is also a petrol head with in-depth knowledge of automobiles and the auto industry.

Exponential Innovation: Why tech startups need to re-model their approach to innovation

Everyone is talking about it and everyone is promising it. You’re constantly surrounded by it, and sometimes you’re even worried by it — Innovation. In the corporate world, innovation has become one of the most used words of the decade. Sit in any boardroom meeting and industry seminar and you’re likely to hear this term being used repeatedly, and if you’re in the technology space you don’t really have a choice. Innovation is the name of the game.

But what does innovation truly mean? Both for my company and my audiences? This is a question that a lot of leaders today are forgetting to ask. More importantly, what measures do you put in place to guarantee your innovation is successfully driving your company forward, whilst in parallel creating a positive impact on the wider community?
In order to make true change, these questions must be addressed head on. If you do this successfully, not only will your business be at the top of its game, but your workforce will act as a force for good. This is where the concept of exponential innovation comes in.

Exponential innovation: redefining the value chain

When Uber was trying to solve the problem of taxi availability anytime, anywhere, it invented an entirely new concept and caused a paradigm shift. Now, every car on the road can potentially become a taxi, and the industry has changed forever. Airbnb in the hospitality industry, and Spotify and Netflix in the entertainment industry have done the same.

Similarly, in the payments industry, when tokenization technology was introduced, it was a conceptual shift in thinking. Should card data be compromised, the data became useless to fraudsters. This not only helped to protect consumers’ financial data, but also boosted consumer confidencein an industry becoming increasingly more digital.
This is the very definition of exponential innovation: it goes above incremental innovation to reimagine the consumer experience and create efficiencies within the industry’s value chain. It challenges the status quo, looks at pain points with a different set of lenses, with the aim to eliminate them, not just reduce them.

It is necessary to approach your product or service from the viewpoint of the end-consumer. Every organization today is a B2C organization, not a B2B or a B2G, because ultimately the work you do will have considerable impact on individual lives. It is that impact that you must look to positively transform, to achieve exponential innovation.
Three-pronged approach to exponential innovation: Build, Acquire, Collaborate
Build.

This is perhaps the most obvious one: design, invent and innovate. Building the right solutions requires looking internally and investing in those technologies and solutions that aim to disrupt existing technologies. In the era of the Fourth Industrial Revolution, emerging technologies such as Artificial Intelligence, Internet of Things, Machine Learning, Robotic Process Automationand Blockchain are ruling the roost in terms of their use-cases for commercial purposes. Gartner forecasted that the number of things connected to the internet surpassed the number of humans and is expected to reach 20.4 billion by 2020. The boundaries of technologies continue to increase, and there has never been a better time in history for innovators to experiment, build and test new solutions.

Complementing this is the growth of the knowledge economy, in which technology giants no longer work in individual silos, but rather encourage knowledge-sharing with each other in order for the world’s technologies to be able to talk to each other. Egypt recently announced plans to set up a Knowledge City in the new administrative capital that will include branches of foreign universities, research, innovation and entrepreneurship centers, in addition to a science park. The Knowledge City is part of Egypt’s Higher Education and Research Strategy that aims to promote science, technology, and innovation ,indicating that the region is ripe for further invention.

Acquire

Look at your landscape. The rise of fintechs and startups is disrupting virtually every industry, not just the tech sector. 2018 saw a record of 366 startup deals across MENA, amounting to $893m of total funding. Egypt was the fastest growing ecosystem, with 22 percent of deals in the region .Thanks to hyper-digitalization, these startups have far greater access to consumers than was ever possible before.

It is important to view these players not as competition, but as potential strategic partners that can help you achieve exponential innovation. Looking at the positive sentiment that Careem and Souq received this past year after being acquired is a clear indication that the region is increasingly becoming a hotbed of unicorn startups, and it makes business sense to leverage this opportunity.

Image result for exponential innovation — From exponential technologies to exponential innovation

Collaborate

Let me give you a world famous example. When Apple decided they wanted to launch the Apple Card, Mastercard didn’t shy away — we became their global payments network.

Similarly, many technology-based startups and consumer-facing apps only work thanks to established companies partnering with them. For example, popular apps in the region such as Zomato, Uber and Namshi enable consumers to purchase their food, travel and clothing anytime, anywhere simply from their smartphones. For this to happen, several stakeholders need to work together. The app itself needs to ensure that the consumer has an easy-to-understand user experience that allows them to make the purchase seamlessly. The telecom provider needs to ensure that a person has sufficient data capabilities to be able to process this payment via their phone. The payment provider needs to ensure they can seamlessly process the payment safely and securely. Collaboration is thus key in this process.

Overcoming the challenges

Trying to achieve exponential innovation comes with its fair share of challenges. In the payments industry for instance, our biggest concernis around misconceptions around security. Consumers take a lot of time to change behaviors and have concerns regarding cybersecurity and fraud. In 2018, the proportion of organizations in the Middle East reporting that they’ve fallen victim to acts of fraud and economic crime increased to 34%, up from 26% in 2016.

The key to addressing this is three-fold. First, it’s necessary to establish a dialogue involving knowledge-sharing with governments, and banking and technology partners to address these issues in a collaborative way. Second, deploy the technological tools available that minimize fraud concerns, and strengthen authenticity. Tokenization and Artificial Intelligence have been instrumental in achieving these goals. Lastly and most importantly, it is necessary to raise awareness on these issues to gain trust amongst consumers. Trust is the foundation of the digital economy, and consistent efforts must be made to ensure that trust.

Transforming industries, economies and communities

Every company that aims to innovate will have its fair share of challenges while trying to achieve exponential innovation. But keeping the larger picture in mind and addressing these concerns is essential not just for a firm’s growth, but also their sustainability and survival.

By executing a three-pronged approach and leveraging technology to achieve exponential innovation, it is possible to transform industries, benefit economies, and positively impact and enrich communities.

The world today is evolving at an exponential pace — disrupting technologies are changing the way people shop, travel, communicate, pay and much more.Exciting times lie ahead, providing companies are able to approach and harness innovation in the right way.

Gaurang Shah is the Senior Vice President, Product Management, Digital Payments & Labs, Middle East and Africa — Mastercard

Charles Rapulu Udoh

Charles Rapulu Udoh is a Lagos-based Lawyer with special focus on Business Law, Intellectual Property Rights, Entertainment and Technology Law. He is also an award-winning writer. Working for notable organizations so far has exposed him to some of industry best practices in business, finance strategies, law, dispute resolution, and data analytics both in Nigeria and across the world

The First 5G Network Launched In South Africa

Rain South Africa, a data-only network provider in South Africa has launched South Africa’s first 5G network in parts of Johannesburg and Tshwane, and it is offering prices that make fibre connections seem slow.

In a statement on Wednesday (18 September), Rain’s chief marketing officer Khaya Dlanga said that the service will first launch in parts of Johannesburg and Tshwane, with access being made available to select customers. Other interested users can apply for 5G through Rain’s website, and will be alerted once it is available in their region.

Here Is All You Need To Know

Selected customers in Rain’s 5G coverage area have been invited to be the first to purchase ultra-fast 5G, unlimited internet from R1,000 per month, according to Khaya Dlanga.
Rain will then deliver a state-of-the-art 5G router to a customer’s home. No installation is required, the router is simply plug-and-play and you will connected immediately.
The speed and capacity of the 5G network, together with the latest Wifi 6 technology in the router, will enable rain users to stream high-definition video to multiple devices simultaneously.
Khaya Dlanga said the company has achieved speeds of 700 Mbps during testing, but the typical client will see speeds around 200 Mbps.
By comparison, a 40 Mbps fibre line at Telkom costs R1,199 a month, and you will pay R1,067 a month for a 50 Mbps fibre line via Afrihost.
Dlanga said that the initial offering aims to provide fast, affordable and easy to install wireless connectivity to homes and businesses as an alternative to ADSL fibre and fixed-LTE.
During the course of the next year 5G coverage area will be extended to Durban and Cape Town, Dlanga said.
5G is the latest iteration evolution of wireless data standards, and promises to be roughly 10 times faster than the current state-of-the-art 4G used by cellphone networks, while also being more reliable.

Read Also: How 5G Connectivity Will Boost The Output Volume of African Startups

South Africa And 5G Network

Vodacom and MTN have both said they could launch 5G locally in 2019, but have been restricted by a lack of access to the necessary radio frequency spectrum.

Vodacom already launched a 5G network in Lesotho in 2018.

In a policy discussion document released in August, South Africa’s national treasury said data prices could decline by as much as 25% if the appropriate spectrum is released in South Africa.

The release of spectrum, Treasury said, would reduce the cost of doing business in SA and contribute up to 0.6% in economic growth.

Communications Minister Stella Ndabeni-Abrahams in July issued a policy directive to Icasa to release additional spectrum.

If implemented, that would be the first time in 14 years that additional spectrum is released for use, after the state repeatedly missed its own deadlines to do so.

You can find out more about the service here.

Charles Rapulu Udoh

Charles Rapulu Udoh is a Lagos-based Lawyer with special focus on Business Law, Intellectual Property Rights, Entertainment and Technology Law. He is also an award-winning writer. Working for notable organizations so far has exposed him to some of industry best practices in business, finance strategies, law, dispute resolution, and data analytics both in Nigeria and across the world

South Africa’s Constitutional Court Outlaws Spanking of Children

September 18, 2019

The South African Constitutional Court today delivered what many South Africans see as its most controversial judgments to date; making spanking of a child illegal in the country. Many civil society organizations are protesting already. The Constitutional Court earlier today upheld a South Gauteng High Court ruling in 2017 to eliminate the common-law defence of reasonable chastisement when spanking a child.

In its ruling, the Court maintained that there are effective ways to discipline a child without needing to resort to corporal punishment. This case has dragged for two years after following earlier ruling by the High Court that reasonable chastisement was unconstitutional in a matter related to a father who was found guilty of assaulting his 13-year old son for watching pornography.

Nigeria Is Going Cashless With New CBN Policy. Here Is What Nigerian Businesses Need To Know

Nigeria is set to displace all physical transactions involving cash. The country’s central bank has issued a new policy that is targeted at phasing out all transactions involving the movement of cash within the country. In simple language, the Central Bank of Nigeria is telling all businesses who rely on the country’s banking system to go digital or be fined for not doing so. This event is happening despite the fact that more than 4 % of the world’s financially excluded live in Nigeria.

Nigeria in the context of lower middle income countries — Source: World Bank’s Global Findex Database

Here Is All You Need To Know

From September 18 2019, withdrawals and deposits of physical cash in Nigeria will now attract processing fees payable by individuals or corporate owners of bank accounts involved where the transactions were carried out in Nigeria’s commercial capital Lagos; the Northern state of Kano; and the Southern states of Rivers, Ogun, Anambra and Abia; including Nigeria’s capital city Abuja.
It will however become effective in all states of Nigeria on March 31, 2020.
Nigeria’s central bank said the measure was put in place to encourage its cashless policy .
Cash withdrawal by an individual from N500, 000 and above will attract 3% of the amount withdrawn while cash deposit of N500, 000 and above will attract 2% of the amount to be deposited.
5% processing fee will be levied on cash withdrawals from N3 million and above from a corporate account while cash deposits attract 3% processing fee.
The charges are an addition to the already existing ones, the CBN’s Director of Payments System Management Department Sam Okojere, said in a memo to deposit banks on Tuesday.

Account Type	Withdrawal/Lodgment Limits	Processing Fees for Withdrawals	Processing fees for lodgements
Individual	Above N500,000	3% (N15,000)$42	2% (N10,000) $28
Corporate	Above N3,000,000	5% (N150,000) $417	3% (N90,000) $250

The Implication of This

Government Struggling to Shore Up A Struggling Economy?

The imposition of extra charges by the CBN may not be unconnected to the President Muhammadu Buhari’s government struggles to boost non-oil revenue since oil sales make up 90% of foreign-exchange receipts.

Poor Financial Inclusion Rate

The new policy is expected to be a major set back on CBN’s continued hype on financial inclusion. Many Nigerians, for numerous reasons are currently unbanked and lack access to formal financial services. The results of the EFInA Access to Financial Services in Nigeria 2012 survey, for instance, showed that 34.9 million adults representing 39.7% of the adult population were financially excluded. Only 28.6 million adults were banked, representing 32.5% of the adult population. Billions of Naira circulate through the informal sector and this has a negative impact on the country’s economic growth and development. The EFInA Access to Financial Services in Nigeria 2012 survey revealed that 23.0 million adults save at home. If 50.0% of these people were to save N1,000 per month with a bank, then up to N138 billion could be incorporated into the formal financial sector every year. With this new policy, expect financial inclusion rate in Nigeria to dive further low. The immediate impact of this is that in the absence of finance, people who are not connected with the formal financial system lack opportunities to maximise their income and expand their businesses. Again, vast unutilized resources, in the form of money in the hands of people who are in the informal sector could limit a country’s economic growth potential.

Source: World Bank’s Global Findex Database

New Digital Tax

Again once the old VAT Act is amended, and the new VAT rate becomes effective, the new rate will automatically be applicable to online transactions carried out in Nigeria. Nigeria ’s Federal Inland Revenue Service, the national tax agency has recently announced that digital tax will become effective January, 2020. This is expected to discourage online transactions and shrink the purchasing powers of Nigerians in a country where the gdp per capita is still less than $2000 ( one of the lowest in the world) and over 86.9, representing 50% of the population are still living below the global poverty line (the worst in the world).

Poor Internet Penetration Rate

The Global State of Digital in 2019 report discovered that there are 98.39 million internet users in the country. Compared to January 2018, there has been a 4 million increase in the number of internet users. Despite this increase, overall internet penetration remains quite low, with only 50% of the population connected to the internet, compared to the global average of 57%. Unlike Nigeria, Kenya has a really high level of internet penetration (84%), South Africa 54%, and Ghana 35%. Of the 98.39 million Nigerian internet users, 54% access the internet on a daily basis. The new policy also brings to question the capacity of Nigeria’s banking sector and other digital services to effectively process payments, with less error and under good and steady power supply.

New Opportunities For Fintech Startups

With the new policy, expect increased activities for fintech startups in Nigeria who would be battling to capture the market share. This is therefore, a golden opportunity for startups in the financial services sector, although there is still a huge barrier of trust to overcome.

Charles Rapulu Udoh

Charles Rapulu Udoh is a Lagos-based Lawyer with special focus on Business Law, Intellectual Property Rights, Entertainment and Technology Law. He is also an award-winning writer. Working for notable organizations so far has exposed him to some of industry best practices in business, finance strategies, law, dispute resolution, and data analytics both in Nigeria and across the world

New Partnership To Enhance Investment Readiness For Startups, Smes Initiated

A new partnership for startups in Namibia is now in place. Business Financial Solutions and Germany-based GreenTec Capital Partners have entered into a strategic partnership to strengthen capacity building, investment readiness, and fund-raising assistance to local start-ups and SMEs in Namibia.

Here Is All You Need To Know

The newly formed partnership comes as Germany plans to invest about N$2 billion in Namibia over the next 2 years.
By applying a unique Venture Building model, the partners aim to tackle the maturity, infrastructure, and funding gaps that young SMEs and start-ups are facing in Namibia, while at the same time de-risking them for investors by applying their support and expertise.
Jointly, Business Financial Solutions and GreenTec will support high potential local start-ups and SMEs in their growth from the proof-of-concept stage to market fit and sustainability by providing customised operational support, company formation and building, investment readiness, and go-to-market strategies and execution.

How To Apply For The Fund

The partners are launching a Call for Applications addressed to entrepreneurs that are interested in receiving support through the venture building model – check www.bfs.com.na for more details as well as the application form.

Ventures will be selected based on their impact, the value they can add, and their economic sustainability.

Charles Rapulu Udoh

Charles Rapulu Udoh is a Lagos-based Lawyer with special focus on Business Law, Intellectual Property Rights, Entertainment and Technology Law. He is also an award-winning writer. Working for notable organizations so far has exposed him to some of industry best practices in business, finance strategies, law, dispute resolution, and data analytics both in Nigeria and across the world

Small Businesses Bear the Brunt of Nigeria’s Border Closure

Nigeria’s indefinite shutdown of its borders is taking its toll on small and medium scale businesses especially those that depend on cross border transactions. This was the findings of our Correspondent who visited two key border towns of Seme and Idiroko over the weekend. Many business people this Correspondent spoke with lamented that the closure has negatively impacted their businesses as what they thought would be just for two weeks or less has become indefinite leaving them in limbo.

Col. Hameed Ali, comptroller general, Nigeria customs service

Nobody seems to know when the border will be reopened even as the ECOWAS Parliament has urged the Nigerian government to reopen them. Speaking on the development, the Comptroller General of Nigeria Customs Service (NCS) Col. Hameed Ali (Rtd) said that Nigeria’s borders will remain closed until the country and its neighbours agree on existing ECOWAS protocol on movement. He stated that there is no specific time for opening the borders adding that “if they agree with us tomorrow on the existing laws, then we sign and update the existing protocol of transit, that’s all”. The Comptroller General informed that there is the likelihood that a meeting would soon take place as efforts are on top gear to have a round table discussion over the sticky issues relating to reasons why Nigeria had to shut its borders.

The Nigeria Customs Service said that it has made tremendous seizures of contraband products in recent times which necessitated government’s decisions to shut down the borders because it felt that efforts at growing the economy through import substitution is being sabotaged by people engaged in nefarious activities using the borders. Noting that by closing the borders, Nigeria was able to completely block the importation of contraband.

Reacting to the claims made by the Customs, some business people who spoke with this Correspondent said that it is a very wrong assumption by the Customs and the Nigerian government to see every product and business transactions across the borders are illegal or contraband because many businesses engage within the ambit of the law. They call on the federal government to resolve as soon as possible, whatever disagreement they have with the neighbouring countries and open the borders for businesses engaged in legal transactions.

Mr. Olufemi Johnson, a licensed customs agent said that what the government should do is to tighten the noose on smugglers while businessmen engaged in legal transactions should be allowed to continue with their businesses instead of such a blanket closure.

The Customs boss however insisted that the closure has helped Nigeria tremendously as it has led to the complete blocking of the influxes of illicit goods, and most importantly, stopped the exportation of petroleum product which is the biggest problem the country has. Also through the measure, the importation of foreign rice has stopped and the market for local varieties has risen.

Kelechi Deca

Kelechi Deca has over two decades of media experience, he has traveled to over 77 countries reporting on multilateral development institutions, international business, trade, travels, culture, and diplomacy. He is also a petrol head with in-depth knowledge of automobiles and the auto industry.

Time For Kenyan Businesses To Be On High Alert As Kenya Gets Ready To Dump Its Old Sh1000 Notes

As the September 30 deadline for the phasing out of Kenya ’s old Sh1000 notes draws nearer, a point would simply be that those who have bitten more than they could swallow from the old currency would be looking for where to deposit their impending liabilities.

“With the September 30 deadline approaching, financial institutions should be even more careful of attempts to circumvent the Anti-Money Laundering requirements, in exchanging or depositing old Sh1,000 notes,’’ CBK has warned in statement to banks,’’ Kenya’s Central Bank has already warned in statement.

Here Is How The New Currency Policy Has Pushed Some Kenyans To Tight Corners

Under Kenya’s new currency regime, some of the country’s currency would be replaced with a new generation of banknotes. To that effect, Kenyans must return their old 1,000 shillings ($10; £8) notes to banks before 1 October, 2019 in a bid to fight money laundering, counterfeits, and corruption).

To effectively implement the new policy, the Central Bank of Kenya has issued some tough guidelines on how to exchange the old Sh1000 currency for new notes.

To this effect, those without a bank account are not able to exchange more than Sh1 million of old currency with the new notes without CBK’s approval.
Even with a new bank account, it is reported as a suspicious activity if the holder all of a sudden credits his account with more than Sh1 million, or seeks to exchange it in cash and walk away without proper documentation on proof of source of funds.

There is an alleged feeling of desperation among those suspected to be hoarding money acquired illegally and who are hence unable to bank it as they cannot openly declare its source. Such individuals are faced with the challenge of losing the money when it is devalued on 1st October as Kenya officially moves on to the new currency as is dictated by the 2010 Constitution, reports Kenya’s Investment Company Soko Directory.

New Guidelines Warning Stakeholders By CBK

In its most recent circular, KCB warned it would take action against any commercial bank that fails to, neglects or omits to comply with relevant regulations.

The regulator reminded lenders of their obligation under the Crime and Anti-Money Laundering Act, 2009, saying they should undertake due diligence on customers’ transactions and ensure effective monitoring of all accounts and transactions.

Source: Kenyan Ministry of Industry, Trade and Cooperatives

In March 2019, CBK also directed all commercial banks, microfinance institutions, and mortgage finance companies to nominate “an independent and competent external third party” to evaluate the institution’s compliance to anti-money laundering and combating the financing of terrorism programs.

The appointed parties evaluate the institution’s customer due to diligence measures, its risk assessment for cases of money-laundering and terrorism financing, check the firm’s internal controls against such financial crimes, and their monitoring process.

The fight against money laundering was one of the Kenya ’s reasons to phase out old Sh1000 notes, which CBK said was becoming increasingly easier to imitate.

Speaking during the Madaraka Day celebrations, CBK governor Patrick Njoroge said the new Sh1,000 notes will help address the growing concerns of illicit financial flows in the country.

The Most Direct Implication of This Is That By October This Year, All Those In Possession of The Old Ksh1000 Notes Will Not Be Able To Use Them

This is directive of the Central Bank of Kenya. CBK governor Patrick Njoroge also revealed that 100 million pieces of the old Sh1,000 note had been returned by end of August 2019 out of 217 million pieces or Sh217 billion in circulation.

This means the public has only 10 working days to exchange some of the remaining bulk.

With the deadline fast approaching, businesses have started blocking usage of the old Sh1000 notes.

Read also: What Kenyan Businesses Need To Know About The New Currency Policy In Place In The Country

Countries That Once Toed Kenya’s Footsteps

In 2016, India changed almost all of its cash overnight, which some critics claim caused long-term financial problems. The Indian government said it was a necessary move to tackle tax evasion and terrorism funding, and in a country where 90% of transactions are in cash, to move towards a cashless society.

Nigeria introduced a similar ban on old notes in 1984 in an attempt to crack down on corruption, as did Ghana in 1982 to help with tax evasion.

This may be a big-time signal for businesses in Kenya to consider storing their cash in foreign domiciliary accounts going forward.

Charles Rapulu Udoh

Charles Rapulu Udoh is a Lagos-based Lawyer with special focus on Business Law, Intellectual Property Rights, Entertainment and Technology Law. He is also an award-winning writer. Working for notable organizations so far has exposed him to some of industry best practices in business, finance strategies, law, dispute resolution, and data analytics both in Nigeria and across the world

Smile Train Partners West African College of Surgeons to Launch Cleft Surgical Certification Program in West Africa

September 17, 2019

The world’s leading cleft organization, Smile Train announced today that it has entered a partnership with the West African College of Surgeons (WACS) to launch Smile Train-WACS Cleft Surgical Certification. The Certification will grant six surgeons per year over the next five years the opportunity to specialise in cleft care across West Africa.

Smile Train is a global organization that empowers local medical professionals with training, funding, and resources to provide free cleft surgery and comprehensive cleft care to children globally. It engages in the advancement of a sustainable solution and scalable global health model for cleft treatment, drastically improving children’s lives, including their ability to eat, breathe, speak, and ultimately thrive.

This development was made known by Smile Train’s Public Relations and Communications Manager, Africa, Emily Manjeru, who informed the media that the one- year Post-Graduate Program will commence in February 2020. WACS will identify accredited centres to serve as training sites in Nigeria, Ghana and French West Africa for the program. The Certification she said is open to applicants in all West African and CEMAC zone countries with priority being given to trainees from countries without significant Smile Train presence.

Speaking during the signing of the Memorandum of Understanding (MoU) which took place at The College in Lagos, Smile Train Program Director of West and Central Africa, Mrs. Nkeiruka Obi noted that the care for cleft patients required more capacity building for surgeons, hence will leverage the College resources to elevate the surgical expertise for local surgeons in the region.

“Smile Train’s sustainable model provides training, funding, and resources to empower local medical professionals to provide free cleft surgery and comprehensive cleft care in their own communities. Through this ground-breaking investment, we will enhance our interventions by establishing centers of excellence across West Africa,” noted Mrs. Obi.

Alongside Mrs. Obi, the President of WACS, Professor Serigne Magueye Gueye welcomed the partnership and expressed commitment to ensuring that the local surgeons from the Certification match the global quality standards of cleft care set forth by Smile Train.

“We are dedicated to ensuring that we not only equip the local surgeons handling cleft, but also aim at establishing connections in developing other program areas of comprehensive cleft care such as speech therapy and orthodontics. Our highly skilled faculty will be sourced from local cleft surgeons and adjunct lecturers from relevant departments in the hospital in which the programme will be running,” said Professor Gueye.

Globally, every three minutes a baby is born with cleft. A cleft occurs when certain body parts and structures do not fuse together during fetal development. Clefts can involve the lip and/or the roof of the mouth, which is made up of both hard and soft palate. To-date, Smile Train has supported more than 113,000 cleft surgeries across 38 countries in Africa. In addition to cleft surgery, they actively support training of nurses, anesthetists, surgeons, speech therapists and orthodontists in cleft care, nutrition programs, speech therapy and orthodontics.

Kelechi Deca

Kelechi Deca has over two decades of media experience, he has traveled to over 77 countries reporting on multilateral development institutions, international business, trade, travels, culture, and diplomacy. He is also a petrol head with in-depth knowledge of automobiles and the auto industry.