Business daily apr 17th 2015 by HABA KWA HABA

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Date with anti-graft czars forces Ruto’s chief of staff into the limelight Page 26

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Friday April 17, 2015 - Sunday April 19, 2015

NO. 2076

Kenyans evacuated as attacks on fo≥eigne≥s sp≥ead in South Af≥ica Foreign Affairs CS Amina Mohamed says State is ready to repatriate if violence escalates

Your free weekly 16-page pullout inside The business of taking a break

BY MUGAMBI MUTEGI

Hundreds of Kenyans living in South Africa have been moved to secure camps as the spate of xenophobic attacks that began in the port city of Durban spread to other regions causing fear among immigrants. Foreign Aﬀairs secretary Amina Mohamed said Kenya was ready to repatriate its citizens should the vio-

Kenya Exports Vs Imports with South Africa (Billion Sh)

SOURCE: ECONOMIC SURVEY 2014

lence persist and spread to other parts of South Africa. The xenophobic attacks have not only damaged South Africa’s credentials as a democratic and multi-racial society but also put at risk the livelihoods of thousands of immigrants living in the country that is Africa’s second-largest economy. Five people have lost their SOUTH AFRICA, Page4»

Explosion of aﬄuence at Indian fashion show >>PAGES 12-13

17th APRIL, 2015 - 23th APRIL, 2015

Keep kids busy du≥ing holidays A lot is on o≠e≥ fo≥ eve≥y taste >>PAGES 8 & 9

Meet a brave CEO >>3 | Home decorations from old bottles>>5 | Prepare for ﬂu season>> 11

WAR ON COUNTERFEITS

UBA sues top

oﬃcial ove≥

Page 7»

Brokers in new legal battle against CGT

BY BRIAN WASUNA

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Merali plans to build Sh2.8bn milk plant Billionaire businessman Naushad Merali has announced plans to build a Sh2.8 billion milk factory in Nakuru, stepping up competition in the dairy sector.

loss of Sh200m United Bank of Africa (UBA) has sacked and sued the head of its legal department for professional negligence that saw the lender lose Sh200 million to two clients. Sylvia Mututsi Magotsi, who served as the bank’s company secretary and head of legal aﬀairs, is accused of failing to scrutinise documents that the two clients used as security to secure the $1.64 million (Sh200 million) credit, causing the lender massive loss. Ms Magotsi was sacked after an internal disciplinary hearing where she allegedly confessed to negligent behaviour. She was sent home with a Sh2.2 million termination package. The bank is now pursuing her for damages and compensation for the multi-million shilling loss. UBA, Page 4»

BRIEFING

Stockbrokers have renewed the legal battle against the capital gains tax (CGT) by filing an application claiming that the High Court relied on a repealed provision of the Finance Act to throw out their case. Page 19»

NEWS INDEPTH Workhorse jumbo jet faces a make or break year at Boeing, Airbus Pages 16-17 »

Kenya Revenue Authority staff pour counterfeit wines and spirits worth Sh60 million at the Nairobi City Water and Sewerage Company sewage dumping point in Ruai yesterday. The liquor was impounded from unscrupulous traders in Nakuru, Eldoret, Nyeri and Embu towns by ofﬁcers from KRA’s Market Surveillance Unit. See also story on page 5. SALATON NJAU

NAIROBI

In your copy of the Daily Nation on 17th April 2015; Kenyatta University Invites applications from qualified applicants for the UNDERGRADUATE AND POSTGRADUATE DEGREE SELF SPONSPORED PROGRAMMES (SSP) FOR MAY AND SEPTEMBER 2015 INTAKE which will be offered in the MAY and SEPTEMBER 2015 to be taken under Full Time and Part Time mode of study at Kenyatta University Main and all Satellite Campuses.

Kеnуatta Unіvеrѕіtу

BUSINESS DAILY | Friday April 17, 2015

TOP NEWS

Kenyans oﬀe≥ed ≥efuge f≥om South Af≥ica lynch mobs »From Page 1

lives in the attacks that South Africa is a key trading parthave also left 1,400 foreigners camp- ner of Kenya that took in Sh3.3 billion ing in government-secured sites away worth of Kenyan exports in 2013. Kenfrom the angry locals. ya’s imports from South Africa were The South African attackers accuse valued at Sh70.7 billion. immigrants of taking their The full impact of the jobs, leaving them destitute attacks may take time to and generating crime. establish, but thousands My insu≥ance Mrs Mohamed yesterday of Kenyans earn their said no Kenyan had been job ≥equi≥es me living from the diﬀerent killed or injured in the atto t≥avel to the segments of the South tacks but that a number African economy. had been moved to safe low-income a≥eas Most Kenyans resicamps as a precautionary of Johannesbu≥g dent in key South Afmeasure. whe≥e ou≥ ta≥get rican cities such as Johannesburg work for “No Kenyan has so far clientele ≥eside big corporations like been attacked but we have but I cannot do Land Rover, the South in the past couple of days African Broadcasting evacuated some to camps this any mo≥e Corporation, P&G and for their own safety,” the because of the ABSA among others. minister said in a telephone violence interview, adding that an There is also a large evacuation plan was in number of Kenyans opSTANLEY KAMAU erating curio shops, cab place should the violence SALESMAN services or food kiosks escalate. The Kenyan High Commission in while hundreds more work as sales South Africa declined to comment representatives with insurance comon the matter and insisted it did not panies such as Old Mutual, Assupol know the exact number of Kenyans and Sanlam. Most of the violent attacks have living in the country or aﬀected by been carried out in the larger Durban the violence.

Foreigners in front of closed shops owned by foreign nationals in Johannesburg following a wave of xenophobic attacks. AFP area of Kwa Zulu Natal and oﬃcers from the Kenya Mission are scheduled to visit the area from 17th April 2015 to meet with Kenyans and assess their situation. “About 400 Kenyans are in the central business district of Durban; about 100 work in the informal sector, while another 50 are employees of two sugar farms in the outskirts of Durban city. In addition, there are about 300 students and lecturers in Kwa Zulu Natal University in Pietermaritzburg,” said Ms Mohamed in a statement. South Africa also has a huge Kenyan student population though no attacks have been reported in the universities. Stanely Kamau, a Kenyan who has lived in Johannesburg for 20 years and who works as a cab driver, said a number of Kenyans have had their property destroyed. Parts of Johannesburg, which is located approximately 600km from the Durban hotspot, have been hit by violence forcing immigrants to seek refuge in police stations. Mr Kamau, who is also a part-time insurance sales representative, said shops belonging to Kenyans have been

looted and set ablaze, leaving them with no source of income. The attackers, some brandishing hatchets and machetes, have also attacked Ethiopians, Somalis, and Malawians asking them to leave the country. “My insurance job requires me to travel to the low-income areas of Johannesburg where our target clientele reside but I cannot do this any more because of the violence,” Mr Kamau said. South Africa has a population of 50 million and immigrants are estimated to account for a tenth of the total. The economy is, however, beset with high levels of unemployment currently standing at 24 per cent, forcing many poor citizens to vent their frustrations on immigrants. This is not the ﬁrst time that South Africa is experiencing xenophobic attacks. Similar attacks in 2008 left 62 people dead and 50,000 displaced from their homes. The latest round of violence began after a Soweto-based immigrant shop owner shot and killed a teenager who had allegedly tried to rob his shop in January. Hostile comments from political leaders such as Edward Zuma, the president’s son, and Zulu king Goodwill Zwelithini are seen to have ﬂared the situation. The latest spate of violence is being seen as eroding the international perception of South Africa as an investment-friendly destination – a concern that forced a group of citizens concerned about the country’s image to protest against the attacks. pmutegi@ke.nationmedia.com

UBA sues fo≥me≥ top official ove≥ Sh200m loss UBA accuses Ms Magotsi of failing to advise that standby letters of credit that the bank received as security from Suisse Bancorp for loans advanced to PES South Africa and Mits Electricals were fatally defective. “As a result, UBA has incurred losses and hereby claims against her $1.64 million (Sh150 million),” UBA says in court papers. UBA says the amount it lost accounts for most of the Sh282 million loss it recorded in the last financial year. The bank has recorded losses for five consecutive years. UBA sunk deeper in the red with a Sh282 million loss compared to the Sh272 million it made in 2013, taking its cumulative losses to Sh1.27 billion. The bank’s loan book shrunk to Sh734 million from Sh789 million in the same period, but its customer savings rose by Sh1.1 billion to Sh3.5 billion. Ms Magotsi is accused of not seeking consent from Mits Electricals and PES South Africa’s guarantor (Suisse Bancorp) before making any »From Page 1

demands for payment as that would have revealed that the documents were defective. “Ms Magotsi also failed to duly advise UBA that the customers had not provided standby letters of credit from first class banks as required and as agreed between the bank and the said customers,” the lender says. UBA now wants Ms Magotsi compelled to refund the amount and to compensate the bank through general and punitive damages. It also wants the former company secretary to pay the cost of the suit. Ms Magotsi was hired as an assistant manager in June 2009 but was elevated to company secretary and head of legal in November of that year. The suit comes as banks grapple with employee fraud, which has cost the financial institutions and their clients billions of shillings. Kenya Commercial Bank last November revealed that it had sacked about 90 employees for fraud and professional negligence. UBA has also accused Ms Magotsi of sharing confidential bank informa-

tion with third parties without the consent of the board of directors. The lender says Ms Magotsi leaked customer statements, internal bank communication and transaction details involving the bank and its clients to unknown persons. The bank has asked the court to issue restraining orders stopping her from using the said confidential information as it does not know the third parties in possession of the material. “As a result of some or all of the foregoing, UBA’s reputation in the eyes of its customers and the public at large has suffered and continues to suffer greatly. The said confidential information could be used to its detriment and that of its customers,” UBA adds. UBA says it has evidence of emails exchanged between Ms Magotsi and the third parties she sent confidential information to, but has asked the judge to allow it to only provide the dossier at the full hearing of the case. It has requested the court for the same in respect to documents prov-

ing how negligence led to the colossal loss. Justice Hellen Wasilwa ordered UBA to serve Ms Magotsi with the suit papers. UBA says it served Ms Magotsi with a notice to show cause why disciplinary action should not be taken against her in December after she was accused of absenteeism, insubordination and negligence in performance of her duties. A month later, she was cited in a report prepared by the group chief inspector in respect to a number of non-performing customer accounts, including the ones owned by Mits Electricals and PES South Africa. The investigations were carried out to evaluate all employees’ performance. Those named in the report, UBA holds, were accorded a fair hearing before the internal disciplinary committee. It was at the hearing that she allegedly confessed to negligence, and the bank has attached a copy of proceedings from its internal trial as evidence. bwasuna@ke.nationmedia.com

My view of xenophobia in South Af≥ica

BY KC ROTTOK

In the wake of the recent spate of xenophobic attacks in South Africa, family and friends have called enquiring about my safety and those of other Kenyans living down here. I thankfully have not been affected and don’t know many African migrants in “white collar South Africa” who have. Like most ills in society, the lowincome groups are most vulnerable to the violence. That said, I think we would be well advised not to bury our heads in the sand and rather speak out. To paraphrase Martin Niemoller: “First they came for the Mozambican mine-worker but I did not speak out because I am not a mine-worker. Then they came for the Malawian gardener but I did not speak out because I am not a gardener. Then they came for the Zimbabwean brick-layer but I did not speak out because I am not a brick-layer. Then they came for me, a chartered accountant from Kenya, and there was nobody left to speak for me.” The Kenyan Diaspora Association in South Africa, of which I’m a committee member, is dominated by Kenyans working in the corporate sector in Johannesburg as well as those who ply the curio trade in the same city. The violence started in Durban, which is about 600 km away, and no reports have been forthcoming of Kenyans affected. Many have asked me whether I am thinking of moving from South Africa as a result of the violence. My response has been whether they think a Kenyan should leave Kenya because of the Garissa University terror attack or an African American should leave the US because of the now rather frequent shootings by police officers. These attacks are not in all areas and one just needs to be mindful of them and hope the powers-that-be will improve the security situation. Whereas you get the odd unfriendly stare from the supermarket teller, the vast majority of South Africans are cordial to people of foreign origin. This is a country that offers the best of both worlds—the kind of infrastructure that exists in the West and the feeling of being at home in Africa. Mr Rottok, a chartered accountant, is the founding editor of the African Professional magazine. He has lived in South Africa for 15 years.

Friday April 17, 2015 | BUSINESS DAILY

ECONOMY & POLITICS NEWS I REVIEWS I ANALYSIS

Kide≥o t≥ashes bus supply deal with Foton PROBE Nairobi Governor says agreement with

Chinese company did not have any legal effect Nairobi county government, nor was it ever contemplated that any money Nairobi governor Evans Kidero yes- would be committed,” he said, adding terday appeared to trash a Sh4.6 bil- that any specific agreements would lion deal that he signed last year with have been subjected to procurement Chinese carmaker Foton rules. The EACC is investigatfor supply of high-capacing claims that Mr Kidero ity buses. All payments presided over a deal where In a statement issued made towa≥ds county officials may have after a six-hour grilling by Ethics and Anti-Corruplegal fees to this side-stepped public protion (EACC) detectives, Mr curement rules to hando≥ any othe≥ fi≥m pick Foton for City deconKidero maintained that the that p≥ovided deal that he signed with the gestion project. Chinese firm did not have The agency also quesse≥vices du≥ing tioned Mr Kidero over susany legal effect. my tenu≥e we≥e picions that as the Mumi“The document in quesmade by the tion, the Strategic Frameas chief executive, he may work Agreement for Naimanagement, have processed legal fees robi Public Transportation of Sh300 million and inEVANS KIDERO Improvement Programme stantly paid Sh280 million remains that, a framework. It creates to the personal account of lawyer Tom no legal obligations on either party Ojienda for services not rendered Last year, City Hall said the MoU and no money was committed by the BY KIARIE NJOROGE

Nairobi governor Evans Kidero. FILE

with Foton would pave the way for the supply of the first 266 buses for the planned metro transportation system, attracting protests from local motor vehicle assemblers who felt they were unfairly locked out. The investment was to be the first phase of 2,000 buses that Foton was expected to deliver in five years. Foton initially said it had not decided whether to assemble the buses

locally or import ready-made units from China. Yesterday, Mr Kidero further dismissed accusation by EACC that City Hall, under his watch, had signed another agreement for supply of buses with Diamond Coaches, a company owned by a Guleid Mursal, saying that he only received a non-viable proposal which did not go forward. Mr Kidero also dismissed allegations that he paid Sh280 million to the law firm of Ojienda and Co for services not rendered when he was the chief executive at Mumias Sugar. “I can confirm that no such amount was ever approved or paid by myself. For the record, I would like to state that all payments made towards legal fees to this or any other firm that provided services during my tenure were made by the management,” he added. Lawyer Tom Ojienda has already moved to court to have the EACC stopped from any further investigations into his bank accounts. gkiarie@ke.nationmedia.com

KRA dest≥oys fake p≥oducts wo≥th Sh60m BY EDWIN MBUTHIA

The Kenya Revenue Authority yesterday destroyed counterfeit products worth Sh60 million in Nairobi after a countrywide inspection on premises suspected to be selling fake merchandise. The campaign targeted wines, spirits and cigarettes seized in Nairobi, Central and Rift Valley regions. “This will ensure that only approved excisable goods are consumed by the public”, said KRA’s head of market surveillance Caxton Masudi. Similar raids have raised tax collected by 40 per cent with excise duty going up by 45 per cent in the second half of 2014. KRA said the number of non-compliant products seized in Nairobi in 2014 was 324,670 with 281,258 found without stamps while 26,392 found with old stamps, 16,020 had no stamps and 600 had swapped stamps.

BUSINESS DAILY | Friday April 17, 2015

ECONOMY & POLITICS

Regulato≥ says b≥oke Inoo≥e≥o to close in 2017

Kenya Power workers upgrade Makande power station in Coast last year. The ﬁrm plans to build substations across the country to improve supply. FILE

BY SIMON CIURI

The Commission for University Education (CUE) has granted bankrupt Inoorero University owners a two-year period to enable its continuing students to finish their programmes. The regulator said the decision was arrived at in the interest of the students who had expressed concern over their predicament if the institution was closed down before they complete their studies. Professor David Some, CUE secretary, yesterday said there would be no extension or intake of new students as the university failed to prove that it has supporting infrastructure to accommodate students after its host building was sold to Mount Kenya University. “The university has become insolvent and we have only offered the two years as teach out programmes and then subsequently lead to its closure,” Prof Some told the Business Daily in an interview. Trouble at the university started last year when a local lender advertised its eight-storey campus building in Parklands, Nairobi indicating it was up for auction after it failed to service a multi-million shilling loan it had borrowed five years back to fund its expansion. This saw Mount Kenya University successfully bid and buy the building for Sh380 million. MKU has already taken over the building while International University of Professional Studies- Inoorero’s new name after rebrandingstudents occupy a section of the fourth floor that accommodates degree students. Inoorero is owned by Francis Nyammo who was associated with the Kenya Finance Bank that collapsed in the early 1990s.

BY SARAH OOKO

Kenya Powe≥ plans 98 new sub stations to cu≥b outages REPRIEVE CEO says multi-billion shilling project will boost supply

which is partly being financed by the World Bank and the African DevelopKenya Power will build 98 new subment Bank (Afdb). stations to reduce frequent supply disThe listed electricity distributor ruptions that have hurt its relationhas been under pressure to improve ship with businesses and households, power supply following numerous the firm has said. breakdowns of its ageing infrastrucThe construction of the first 36 ture in the past, especially during substations is already under way heavy rains. The unreliable supply has forced manufacturers after contractors were to install stand-by generaawarded tenders valued tors, translating to higher at Sh10.45 billion in February. The tendering of We expect to have costs of production that another 29 units is to be the new 98 sub- are eventually passed to consumers. concluded by July while stations by June the construction of the reDr Chumo said he was next yea≥. maining 33 sub-stations is hopeful that the additionset for early next year. al sub-stations and power BEN CHUMO, KENYA POWER lines would not only boost Kenya Power chief exCEO ecutive officer Ben Chumo supply, but reduce system said new low-voltage dislosses and increase capacity for connection of new customers. tribution lines will also be installed from the new sub-stations to customAbout 3.1 million electricity users ers’ premises. are currently connected to the na“We expect to have the new 98 subtional grid. stations by June next year,” Dr Chumo Substations convert electricity told the Business Daily without discoming from plants through high voltage transmission lines– 120 kiloclosing the total cost of the project BY NEVILLE OTUKI

volts (kV) or above– to lower voltage for distribution to homes and industries. Kenya Power constructs voltage lines under 220kV while those above fall within the mandate of the Kenya Electricity Transmission Company (Ketraco). The ﬁrst 36 substations will be located in 23 counties including those in Rift Valley, Central, Coast and Western parts of Kenya. Kenya Power last year announced it would in the next two years use Sh2 billion to establish lines dedicated to heavy electricity consumers like manufacturers, thereby cushioning them from unforeseen collapse in the general power distribution system. The construction of the new substations is part of the Kenya electricity modernisation project (KEMP) aimed at boosting eﬃciency in the power sector. The construction runs parallel to the ongoing projects aimed at adding 5,000 megawatts to the national grid by 2017. notuki@ke.nationmedia.com

KTDA accused of blocking key evidence in suit BY BRIAN WASUNA

Small -scale tea farmers have accused the Kenya Tea Development Agency (KTDA) of using a suit filed in the High Court to block another case in which Kericho governor Paul Chepkwony has accused it of price-fixing. Over 1,000 farmers yesterday filed an application seeking to join a suit KTDA filed in a bid to quash a damning Competition Authority of Kenya status report on the tea industry. The farmers have cited the report as part of their evidence in the Sh93 billion suit filed by Prof Chepkwony at the Kericho High Court. Prof Chepkwony based his suit on

Child≥en’s hea≥t op waiting list at KNH st≥etches up to next yea≥

another report by the Tea Directorate, which accused KTDA of colluding with big market players to control prices and buy small holders’ green leaf at extremely low prices, to the farmers’ detriment. He argues that farmers have lost Sh93 billion as a result of what he termed as KTDA’s collusion. Last week, KTDA sued CAK over the report, saying the watchdog tricked its officials to obtain confidential information used to compile it. It adds that some of the findings are inaccurate. “KTDA wants to attack the proceedings in Kericho using this case. By seeking court orders from this court, to quash this report KTDA is merely trying to deny small -scale farmers key

Prof Paul Chepkwony, Kericho governor. FILE evidence. The small-scale farmers’ petition is heavily reliant on the report by CAK,” the farmers’ said. The agency has asked the court not to admit the farmers into the case, arguing that they are not parties to the

Kericho case hence have no standing in the suit against CAK. Over 5,000 farmers are seeking to join Prof Chepkwony’s case, but are yet to be admitted to the case which will be heard in June. KTDA further argues that the report was not annexed as evidence when Mr Chepkwony ﬁled the case, hence cannot be said to be crucial to the Sh93 billion case. But the farmers maintain that they did not know of the report when the Kericho governor moved to court on their behalf. CAK, represented by Attorney- General Githu Muigai, is yet to respond to the suit. Justice Weldon Korir granted the A-G until Monday to respond.

Children in need of heart surgery at the Kenyatta National Hospital (KNH) have been put on a waiting list stretching to 2016 due to lack of equipment at the facility. The national referral hospital is facing a shortage of key medical equipment such as valves and oxygenators. Approximately 400 children suﬀering from severe heart conditions require the equipment for surgical treatment. The two cost about Sh100, 000 and Sh60, 000 respectively. Lily Tare, the KNH chief executive oﬃcer, said cases of heart disease in children have been increasing at the hospital yet it lacks facilities to adequately take care of them. “At times we get some of the equipment such as valves but then they run out before we can operate on all children, forcing us to turn them away,” said Dr William Okumu, a cardiothoracic surgeon at KNH, who performs the heart operations.

Treatment He added that treatment costs are also an impediment to children with heart ailments “and so the government needs to look for ways to subsidise or abolish them altogether.” Whereas private hospitals charge approximately Sh1 million to perform heart surgeries on children, the cost at KNH is about Sh300, 000 which the doctor says is still way out of reach for most Kenyans. He noted that even though there are seven cardiothoracic surgeons at KNH who are trained to handle these complex heart surgeries in children, their capacity is underutilised due to lack of equipment. “I haven’t operated on any child for two weeks now. And they are really suffering and wondering why we can’t do anything to ease their pain,” Dr Okumu said when KNH received a donation of 10 heart surgery beds worth Sh3 million from Jubilee Insurance Company staff. Ms Tare said the easily adjustable beds would offer adequate physical support and comfort to the patients before and after surgery. To function optimally, the hospital still needs 30 more such beds to adequately cater for the over 200 patients aged between two to 18 years who are admitted for surgery annually at KNH. The majority of these children suffer from congenital heart diseases (emanating from birth defects) as well as rheumatic heart disease arising from untreated sore throat.

Friday April 17, 2015 | BUSINESS DAILY

CORPORATE NEWS NEWS I REVIEWS I ANALYSIS

Me≥ali to build Sh2.8bn milk plant PLAN Billionaire chooses Nakuru as factory’s

Milk production in Kenya from 2009 to 2013 Volume (Million litres)

location owing to proximity to central Kenya during launch of the Creambell brand of regular ice-cream, frozen yoghurts Billionaire businessman Naushad and cones, Mr Merali, also chairman Merali has announced plans to build of the Sameer Group, said he chose a Sh2.8 billion milk factory in Nakuru, Nakuru due to its close proximity to stepping up competition in the dairy central Kenya, a major milk producsector that has recently attracted deep- ing region. pocketed investors. Kenya’s dairy industry has expanded rapidly in recent years, Mr Merali, through in tandem with the rising the agriculture unit of demand for processed his investment group The Daima milk driven by a growing Sameer, is already a big b≥and is doing middle class. player in the processed The high growth milk industry through well in the prospects have attracted his Daima brand of fresh ma≥ket having wealthy investors into milk and yoghurts. cut a niche fo≥ the sector dominated by The Sameer Agriculture & Livestock Ltd innovativeness... President Uhuru Kenyatta family’s Brookside Dairy (SALL) unit already exANJAN PATOLE and the State-owned New ports milk products to East African countries, Yemen, Egypt, KCC. Sudan and the Democratic Republic Deepak Kamani, chairman of conglomerate Zuri Group and the man of Congo. Speaking in Nairobi on Wednesday at the centre of long-running Anglo-

Two ministe≥s summoned ove≥ New KCC sale BY EDWIN MUTAI

BY EVELYN SITUMA

SOURCE: COMPANY REPORTS

Mr Naushad Merali. He has been increasing investment in milk sector. FILE Leasing ﬁnancial scam, in February announced plans to build a fresh and powdered milk plant in Nyahururu. Africa’s richest man, Aliko Dangote of Nigeria, has also announced plans to set up a factory in Kenya to produce dry milk for local and export markets. French food group Danone last year acquired a 40 per cent stake in Brookside and announced plans to help the company expand its product portfolio and reach in East Africa.

“The Daima brand is doing well in the market having cut a niche for innovativeness on the extended shelf life milk technology ,” said company chief executive Anjan Patole. SALL’s current daily milk processing capacity stands at 180,000 litres. Mr Merali on Wednesday also launched a Sh1.9 billion Ice-Cream production unit on Nairobi’s Lunga Lunga Road. It has a monthly production capacity of 500,000 litres. esituma@ke.nationmedia.com

Parliament has summoned Treasury secretary Henry Rotich, Industrialisation secretary Adan Mohamed and the Privatisation Commission over the intended sale of milk processor New KCC to strategic investors. The National Assembly Agriculture committee said the two ministers and the privatisation agency will be required to explain why it is impossible for former KCC shareholders, majority of whom are farmers, to be identiﬁed before the intended privatisation. Committee chairman Adan Noor (Mandera) ruled that Mr Rotich, Mr Mohammed and privatisation commission chief executive oﬃcer Daniel Mureithi should shed light on the shareholding of the now State-owned milk processor in a two-day conference to be held next Thursday and Friday. KCC, originally owned by farmers, collapsed due to mismanagement and was revived by the government.

BUSINESS DAILY | Friday April 17, 2015

CORPORATE NEWS COUNTY BUSINESS

Consolidated Bank picks ex-KCB boss as chief executive

Investo≥ in Sh1bn buyout of Westlands based hotel BY EVELYN SITUMA

MANAGEMENT Position at State-owned

lender had remained vacant from last March last year, clearing the way for the board to initiate the hiring. One of Mr Kiyai’s tasks will be to Consolidated Bank has appointed improve the bank’s thinning asset as CEO Thomas Kipkemei Kiyai, a base, to give the lender room to grow former KCB executive, ending a protracted recruitment that saw the lendits loan book. er’s board reject a Treasury appointee “The bank’s strategic plans will also to the post. focus on developing its capital base, Mr Kiyai was until the appointwhich will help to drive long-term growth, explore new market opportument KCB’s director for financial nities and enhance straplanning. tegic flexibility to pursue The chief executive polocal partnerships,” said sition of the State-owned Going fo≥wa≥d a statement released by bank had remained vacant since March 2014 when the the bank. we will focus board refused to recognise A weak capital base on g≥owing the Treasury secretary Hensaw Consolidated Bank and defining ry Rotich’s appointment of report a half-year loss Geoffrey Ndambuki as the mo≥e innovative in 2014, in an induswhere double-digit new chief executive. solutions fo≥ ou≥ try growth in profitability Consolidated Bank clients has become the norm. chairman Benson Ateng Towards the end of said at the time that Mr THOMAS KIYAI, CEO 2014 the Treasury, the Ndambuki’s appointment CONSOLIDATED BANK biggest shareholder was unprocedural since with a 50.2 per cent the bank’s board was not stake, agreed to pump Sh500 milfully constituted to oversee the recruitment. lion in additional capital, which was meant to also make the bank comply It is the bank’s board that negowith industry regulations. tiates employment terms with the Consolidated Bank’s core capital chief executive, even though the stood at Sh840 million toward the end Treasury Secretary is the appointing of the year, which was below the Sh1 authority. A court suit blocking the appointbillion statutory minimum set by the ment was withdrawn in September Central Bank of Kenya. BY JOHN GACHIRI

Consolidated Bank in Nairobi. The bank has appointed Thomas Kiyai as the new chief executive. FILE Core capital to deposit ratio was at 6.7 per cent against a mandatory eight per cent, while the core capital to risk assets ratio was six per cent compared to statutory eight per cent. Analysts said that the new banking laws will also require all lenders to increase their capital base, which should result in the Treasury and other shareholders pumping additional funds in Consolidated Bank. “The new prudential guidelines under Basel ll require provisions for operational risk, thus the minimal capital required was revised upwards,” said Agnes Achieng’, a research analyst at Sterling Capital. Mr Kiyai also said that the bank will also join the fray of lenders who are increasing the use of mobile and Internet platforms which are able to pool funds more eﬃciently and cut the cost of banking transactions.

“We are decisively strengthening and improving our competitiveness and targeting growth initiatives across our core businesses. Going forward we will focus on growing and deﬁning more innovative solutions for our clients and grow our presence particularly in the growing Internet and mobile banking space,” he said in a statement. Equity Bank, for example, says that its Mobile Virtual Network Operator (MVNO) licence would cut transaction costs by as much as 50 per cent. Kenya’s largest bank by customer base estimated that transaction costs incurred through its mobile platform are Sh7, which is half the Sh14 incurred through agents, the cheapest transaction platform prior to the introduction of the MVNO system. jgachiri@ke.nationmedia.com

Samsung S6 phone ≥eco≥ds 500 Kenya p≥e-o≥de≥s BY WAINAINA WAMBU

Samsung Kenya recorded 500 pre-orders for both the Samsung S6 and S6 Edge before yesterday’s oﬃcial launch of the two high-end phones in Nairobi, the global tech giant revealed. The Galaxy S6, which goes on sale today in the Kenyan market, is the sixth edition of the South Korean electronics giant’s signature handset along with its curved-edge variant, the Galaxy S6 Edge. The phones were launched globally on April 10. The smartphones will retail between Sh70 000 and Sh90,000. The smartphones have new features such as wireless charging and inbuilt battery. S6 has a higher processor capacity than its predecessors and is also much lighter. The phones’ touch-type ﬁngerprint

Samsung EA vice president Robert Ngeru holds the new S6 smartphone. DIANA NGILA

scanner provides quick authentication and saves encrypted data in device storage. “By listening to our customers, and learning from both our success and areas of improvement, we continuously push forward new technologies and ideas. With a reimagined design, latest network technologies and novel services, the Samsung Galaxy S6 and Galaxy S6 Edge oﬀer users the ultimate experience in smartphone options.” Said Robert Ngeru, the Samsung Electronics East Africa vice president and chief operating oﬃcer during yesterday’s launch. Each of the phones come with a storage option of 32GB and 64GB, with a 128 GB model slated to come later at a higher price. Samsung rarely discloses handset

sales volumes but the Galaxy S4 — released in 2013 — is known to have set the firm’s sales record of 70 million units globally. The firm suffered a slide in profits last year, hit by slowing demand in an increasingly saturated and competitive smartphone market that it had largely dominated since 2011.

A Kenyan-owned four- star hotel has announced a Sh1 billion buyout of a Westlands-based rival. The Heron Portico, which is managed by Indian hospitality group Sarovar Hotels & Resorts, says the acquisition of Zehneria Hotel in Nairobi’s Westlands will help it penetrate the growing middle class market and expand its market share in conference tourism and hospitality industry in Kenya. The Heron Portico financed 80 per cent of the purchase price using debt while the rest is self-financed. “I’m glad to announce extension of our partnership with Sarovar through our acquisition of Zehneria Hotel. I’m pleased, Sarovar has consented to it,” said Karim Teja the Chairman and shareholder of The Heron Portico, a family-owned business which is part of a multi-million shilling empire. The Heron Portico has over the years undergone three name and ownership changes. It was at first known us Heron Hotel, then Heron Court Hotel and now it’s The Heron Portico. Business travel has picked up in Kenya, amid decline on leisure travel. Mombasa’s tourism and leisure outlets have been adversely affected by terrorism attacks with many hoteliers closing shop. Insecurity and travel advisories from Kenya’s traditional tourists markets like the United Kingdom has been blamed for the decline of tourists’ arrival in the country. However, hoteliers are seeing business travel as a new source of revenue. More than five hotels targeting business travellers and conference tourism has been opened up in the past three years. The latest is the Hilton Garden Inn on Mombasa Road by Modern Reliance Ltd. “In the last four years there has been a loss of leisure travel but that has been complemented by business travel,” Mr Teja said. International firms setting up their African hubs in Kenya are contributing to the demand for accommodation and hotel service in this niche.

Fast-growing The company struggled to fend oﬀ a double challenge from Apple in the high-end market and rising Chinese ﬁrms such as Lenovo and Xiaomi in the fast-growing mid and low-end markets. Samsung hopes the S6 will re-establish it among the global smartphone market leaders in contention with Apple, which has enjoyed good sales of its iPhone 6 launched last September.

The Heron Portico Hotel in Nairobi. FILE

Friday April 17, 2015 | BUSINESS DAILY

IDEAS & DEBATE OPINIONS I REVIEWS I ANALYSIS

REALITY CHECK Blacks encounter institutional and interpersonal racism on a daily basis

Hani lives on in the impatience fo≥ justice by South Af≥icans ing at this time every year. Mr Hani has come to occupy a place f you ask South Africans of my in the imagination of black South Afgeneration to name the most ricans that is virtually unrivalled. important political event of their Whereas Mr Biko was an iconoclast lives, many will cite the assassination who smashed the idols of white supremacy, he was only 31 when he was of Chris Hani. Mr Hani was revered murdered. He didn’t live long enough for his bravery in fighting against the to fulfil his enormous potential. apartheid government and for his internal dissent within the liberation Mr Mandela lived to 95, long movement. In 1990, after Nelson Manenough to both achieve his political dela was released from prison, Mr Hani objectives and to transcend politics. questioned the decision to suspend the Mr Hani, however, was 51 when he was armed struggle in favour of a negotiassassinated. If Mr Biko died too soon and Mr Mandela had ample time, many ated political settlement. He worried believe Chris Hani was cut down just that the men who had upheld a racist system for decades could not be trusted as he was ready to lead. to simply hand over power. The men found guilty of Mr Hani’s murder have never expressed remorse Mr Hani was gunned down in the for their actions, and haven’t been driveway of his home in front of his 10-year-old daughter on April 10, 1993. forthcoming about crucial aspects of White supremacists Clive Derby Lewis the crime, fuelling suspicions that they and Janus Waluz admitted to killing were part of a wider conspiracy. him. Their intention was to destabilise As a consequence, Mr Hani’s famthe country’s transition ily has not forgiven to democracy - and they the killers and is very nearly succeeded. unlikely to do so. We have lived with For a week after Mr His widow, Limcho≥eog≥aphed unity Hani’s death there were pho Hani, remains fo≥ long enough to outbreaks of violence. bitterly angry. She know that we now Nine days after the killfought their Truth ing, a huge crowd gathand Reconciliap≥efe≥ ac≥imonious and ered at Johannesburg’s tion Commission ≥obust disha≥mony. We largest stadium. Angry (TRC) amnesty see ≥econciliation as and worried about the application and threat of unrest, Mr in recent years pa≥t of a na≥≥ative... Mandela closed his has opposed each eulogy by pleading for medical parole application lodged by the 79-year-old Mr calm: “When we leave here, let us do Derby Lewis. so with the pride and dignity of our Her rage against both men and nation. Let us not be provoked.” He their refusal to even pretend to be reserved his final words for Mr Hani himself, saying, “You lived in my home, sorry stands in stark contrast to the and I loved you like the true son you banal script of reconciliation and forwere.” giveness that has dominated South It is difficult to overstate Mr Hani’s Africa’s political landscape for the importance to black South Africans. last 20 years. Having escaped three previous assasThose of us who are tired of the sination attempts he was legendary empty politics of reconciliation - which long before his murder. His death lies assumes that whites have paid for their in the middle of a tumultuous but ultisins and blacks have forgiven them mately triumphant era in South Africa’s find some succor in knowing that Mr political history; it occurred roughly Derby Lewis will likely die in jail. halfway between the brutal murder of In the early 1990s, peace and recthe black consciousness leader, Steve onciliation were preached with an almost religious fervour. In 1995, one of Biko, in 1977 and the quiet passing of Mr Mandela’s first acts was to estabMr Mandela in 2013. This symbolism is not lost on those lish the TRC in order to formalise the of us who continue to mourn his passforgiveness process. Very few people

Other Voices Nocolas Maduro Venezuela President

Jorge Ramos (New York Times) When you are an “ex,” you sometimes dare to do things you were unable to do before.Take the 25 ex-presidents of Latin American nations who signed a letter denouncing the “crisis of democracy” in Venezuela, in advance of the Summit of the Americas in Panama. Human rights are being violated under the regime of Nicolas Maduro, and the world should be alarmed, they declared. This is a familiar strategy, however. The same thing happened with regard to decriminalising marijuana.

SISONKE MSIMANG

South African President Jacob Zuma carries a wreath to the grave of late anti-apartheid activist Chris Hani during the 20th anniversary of his death. FILE were jailed, and hundreds applied for amnesty on the basis that their actions had been politically motivated. Today, many black South Africans see the TRC as a disappointment. Although the commissioners - led by Archbishop Desmond Tutu - envisioned a process in which telling the truth would lead to forgiveness, this rarely happened. Too few (mainly white) perpetrators told the truth, and too many (mainly black) victims were encouraged to forgive them anyway. To make matters worse, when the TRC reached the end of its five-year mandate, many whites saw this as the end of a historical chapter that did not need to be revisited. Moving forward hasn’t been so easy for blacks. The structural effects of apartheid are still evident in the layout of our cities, in our schools and universities and in our workplaces. Even those born after 1994 deal with interpersonal and institutional racism on a daily basis. This is not the case for most young white South Africans. They continue to enjoy better access to employment, education and health facilities. Yet on university campuses, and on social media, young whites often espouse the view that talking about race and racism keeps society locked in the past. Some even go so far as to suggest that talking about racism is itself racist. This attitude has pernicious effects. In a survey released by the Institute for Justice and Reconciliation, only half of white youth surveyed agreed with the statement, “apartheid was a crime

against humanity,” as the United Nations defined it in 1966. But what name then do we give to a crime that allows the next generation of one population to deny the injustices it has done to children of another? I believe that Mr Hani would have eventually ruled South Africa as president if he had lived. I like to think that he would have defied his mentor, Mr Mandela, by offering us a less conciliatory path to dignity. Mr Hani may be gone. However, a new generation has embraced his brand of restlessness. Like Mr Hani, we are cynical and distrustful of those who hold power - irrespective of race. The only politicians we admire are dead. We have lived with choreographed unity for long enough to know that we now prefer acrimonious and robust disharmony. We see reconciliation as part of a narrative that was constructed on the basis of anxieties that are no longer relevant: Democracy has taught us that raised voices don’t have to lead to war. This may not feel good, or even comfortable. And it does not offer the peace many black South Africans imagined 20 years ago. Nonetheless our impatience for justice is a new kind of hope; a sign that green shoots may yet emerge from the ruins of the rainbow nation. Mr Msimang is a columnist for the South African website The Daily Maverick and the former executive director of the Open Society Initiative for Southern Africa.) Adapted from the New York Times.

Hillary Clinton US presidentia aspirant

Hadley Freeman (Guardian) There are loads of good reasons to vote for Hillary Clinton. Lots and lots of them! And absolutely none of them have anything to do with her gender. But you wouldn’t know this from the ﬂurry of coverage this week about her presidential candidacy, from her critics but also from many of her supporters, which in many cases has focused not just primarily but solely on the fact that she is, yes, a female woman type person. Raul Castro Cuban President

Simon Jenkins (Guardian) This week the US was still refusing to lift economic sanctions on Cuba, while admitting their failure for half a century to bring down the Castro regime. Indeed, the effect of sanctions is Cuba’s chief tourism appeal. At the same time America and Britain are resisting Iran’s demand for sanctions to be lifted following the inspection of its nuclear plants this summer. Sanctions have become as sacred to western armouries as nuclear bombs were 50 years ago.

BUSINESS DAILY | Friday April 17, 2015

EDITORIAL & OPINION

Published by the Nation Media Group, Kimathi Street, Nairobi

Linus Gitahi: Chief Executive Ofﬁcer | Tom Mshindi: Acting Editorial Director Ochieng’ Rapuro: Managing Editor P.O.Box 49010 GPO Nairobi Telephone: 254 20 328 8104 Fax: 254 20 214849 Email : bdfeedback@nation.co.ke www.bdafrica.com

Do not close Dadaab, stabilise Somalia

enya is between a rock and a hard place, in as far as the issue of the Dadaab refugee camp closure is concerned. The government is damned if it closes the camp, and it is damned if it does not. In terms of the immediate economic impact, Kenya stands to lose more than Sh10 billion that flows to the camp in terms of aid from international agencies who mainly contract local traders and transport companies. Thousands who are directly and indirectly employed by economic activity generated by the camp are also likely to lose their jobs. But Kenya, one would argue, is already losing much more by having the camp open. According to Deputy President William Ruto-- who has been most vocal in the call for disbandment of the camp—Dadaab has become a fertile training ground for militants and other criminals who find their way into urban centres in Kenya and terrorise citizens. He says the camp, which hosts more than 400,000 refugees, must be closed in the next three months and the predominantly Somali refugees repatriated back to their country. The repeated images of terror attacks by Al-Shabaab in the past five years have scared away tourists from Kenya’s pristine beaches and game parks, bringing the multi-billion shilling tourism industry down on its knees. Besides killing thousands of tourism jobs and slowing the in-

ﬂow of foreign currency billions, the perception of insecurity created by the repeated terror attacks has also scared away foreign investors and stymied overall economic growth. With all the negative impact that the presence of the camp is having, it would be tempting to buy the deputy president’s argument of an immediate closure. Yet the reality of the issue makes the debate much more complicated. The majority of refugees camping in Dadaab, happen to be innocent mothers and children who were displaced by war in Somalia. Criminal elements within the camp would probably be just in the hundreds. With Somalia still practically at war, a blanket closure would condemn so many to destitution and possible death, which would paint a very negative image of Kenya on the international map. A forced closure of the camp would also be in violation of international treaties that Kenya has signed. What is needed is dialogue between Kenya and the international community. The United Nations and other world powers must see the huge refugee camps as not only a Kenyan but as an international problem. For a start, more funding for Kenya’s security forces policing the camp would help to neutralize the immediate threat posed by the camps. The long term solution, however, remains stepping up international eﬀorts to stabilise Somalia.

CJ move welcome

he decision by Chief Justice Willy Mutunga, to set up a performance measurement system within the Judiciary must be applauded. As the old adage attributed to William Goldstone says, justice delayed is justice denied. It is a legal maxim that should inform the operations within our judiciary, which has over the years been accused of delaying the hearing and determination of cases. That both criminal and civil cases will now be determined within six months from the time of ﬁling is laudable. We hope that members of the Judiciary will take this as a challenge and an opportunity to restore faith in the judiciary. Over the years, litigants have ended up losing conﬁdence in the

legal system, which has frustrated their eﬀorts to seek justice due to unnecessary delays. Also, the courts have been turned into playgrounds by those seeking to tire their opponents with cases. They have also been used by businessmen and institutions to stop award of contracts as a delaying tactic. This has denied this country a chance to implement projects. The Kenya Private Sector Alliance estimates that billions of shillings are held up by court cases. All this has deterred investors from having faith in the judiciary and as a result, it is the nation which loses. If Dr Mutunga can clear the backlog and hasten the hearing and determination of cases, we shall have made a big stride towards a just society.

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“Be nice to me, Brian... Otherwise I’ll send you over to a meeting...”

Kenyans yea≥ning fo≥ eﬃcient Judicia≥y

JAINDI KISERO LEGAL

hief Justice Willy Mutunga has set very high targets to combat the problem of case delays in the courts. Under the new targets, case files will be retrieved within five minutes of being requested by members of the public. Dr Mutunga has also promised that courts will now hear cases within 60 days of their being filed and give a decision within 12 months. The new targets have come complete with a new institutional mechanism to measure and monitor performance by courts and judges on these targets, and on a regular basis. Known as the Directorate of Performance Management, the new bureaucracy being created will be receiving court returns and capturing data on movement of cases and files on a daily basis. The good thing about institutions like these is that they outlive the individuals who introduce them. According to Dr Mutunga, habitual late comers and absentees will be required to put in extra hours. Stations

that remain notorious for delaying cases and losing ﬁles will be exposed. Will the new experiment work? Will the Judiciary deliver on these ambitious targets? We must wait to see. But I think that Dr Mutunga needs to be supported not only for raising the bar for judges and magistrates, but also putting the focus on the biggest weaknesses in our justice system. Kenyans have very many good qualities, but a sense of value for time is not one of them. There are inordinate delays in the disposal of cases in our courts. As the saying goes, justice is blind, but does it have to be lame? The statistics are scary. This week, Dr Mutunga cited one particular case that has been dragging at the High Court since 1969. He also disclosed that the backlog of cases currently stands at 400,000. Damning as the statistics are, they are a big improvement from what used to be the norm before he joined the Judiciary. Indeed, reducing the long delay before a case reaches hearing and shortening the hearing itself, have been top priorities for Dr Mutunga’s regime. Hardly a few months ago, the Judiciary rolled out a project dubbed the ‘old cases clearance initiative”, which saw cases in the Nairobi High Court Civil Division listing 14,900 old cases listed for hearing, 11,100 dismissed, 3,669 settled or withdrawn, and 154 set down for hearing and ﬁnal determination by mid next year.

The exercise has now been spread to upcountry courts. Clearly, our judiciary is going through a gradual process of institutional renewal. This is something to be lauded because as we all know, protracted litigation in courts of law can seriously damage the health of commerce. And, when the Judiciary is slow and corrupt, it introduces uncertainties into the business climate. Laws may not mean much and those with commercial disputes may avoid taking cases to court unless they are certain to be the highest briber. Courts can be circumvented, for instance, by hiring private arbitrators or resorting to the protection provided by organised crime. When you see execution-like killings of businessmen becoming too common as is the case today, it is usually part of the brutal private system of dispute resolution. But for Justice Mutunga to succeed on a sustainable basis, the supply side of the equation will also need to be addressed. We take cases to court in mindboggling numbers. Our lawyers ask for adjournments on the most ﬂimsy of grounds. If we cannot achieve an eﬃcient and properly functioning judiciary, Vision 2030 will not happen. All those extravagant economic growth predictions we make will turn out to be worthless. jkisero@ke.nationmedia.com

VIEWS FROM ABROAD Why Hillary has no chance

Opinions f≥om a≥ound the wo≥ld Remembering oldest genocide Giants must work together

Why does it already seem certain that former US Secretary of State Hillary Clinton has no chance of winning her second presidential bid? It’s not her previous MOSCOW TIMES political defeats, the MOSCOW information about her that has accumulated over her decades in the public eye, as well as the fact that she managed to lose to Barack Obama in 2008 despite going into that race as the favorite. But there is a far simpler explanation: Hillary Rodham Clinton is not “likable.” She wears a smile that is coldly calculated to create the impression of a pleasant person.

Turkey’s row with the Pope over the Armenian massacre highlights how no country can hide from its history. A row between the Pope and the Turks has a THE TIMES LONDON pleasingly antique ring to it, invoking 16th century tapestries of the Battle of Lepanto or the Siege of Malta. And the summoning of the ambassador of the Vatican to Ankara for a dressing down was indeed over a historical matter. But one that resonates even 100 years after. Pope Francis referred to the ﬁrst genocide of the 20th century as being of the Armenians of the Ottoman empire.

Nigeria and South Africa have long competed for the position of the continental superpower. But it’s time to work together. South Africa needs Nigeria . It MAIL & GUARDIAN JOHANNESBURG needs access to Nigeria’s vast markets. Second, Pretoria needs an inﬂuential and trusted ally in multilateral forums. The one-time duet of Thabo Mbeki and Olusegun Obasanjo, formerly Nigeria’s leader, raised Africa’s voice and stature in global forums. Fragmented communication and lack of coordination by a weak AU have resulted in policy disjunction and incompetence.

Friday April 17, 2015 | BUSINESS DAILY

EDITORIAL & OPINION

Let us suppo≥t bid to ease t≥aﬃc jams in city MWENESI AKIDIVA AGRICULTURE

he recent decision by Nairobi Governor Evans Kidero to reopen Bunyala Road and Lusaka Road roundabouts is commendable. As it is, there have been rumours to the eﬀect that Kidero is out of touch with reality, a man living in an ivory tower and far removed from the people he represents. Nothing is further from the truth and Kidero has demonstrated time and again that he listens to Nairobians and acts on the many issues aﬀecting them. A few weeks

ago the governor got stuck in traffic, abandoned his official limousine and walked all the way from the city centre to Villa Rosa Kempinsky Hotel in Westlands where he had an official function. It was after this that he vowed to implement measures aimed at dealing with traffic snarl-ups launched by CS Transport Michael Kamau. It is worth noting that both Nairobi County and the national government have promised to accelerate construction work on the Southern Bypass which when opened will greatly reduce traffic congestion on Mombasa Road, Uhuru Highway, the CBD

Letters

and Westlands. This is because heavy trucks will be diverted to the new road and bypass the city. While at it, let us not lose sight of the big picture. The governor has stated that the ultimate goal is to have over-passes and underpasses on aﬀected roads, which will greatly improve traﬃc movement .

Flexible working hours As we wait for things to improve, it is time we also did our bit. Employers should start by introducing ﬂexible working hours. There is no good reason for people to wake up at 4am and spend the next three to four hours get-

ting to the office. If office reporting time was staggered there would be less congestion on roads. We also need to encourage car-pooling. If four to five neighbours rode to work in one car this would reduce the heavy morning traffic. Finally, my humble request to fellow Nairobi motorists is that let us give the governor time to fulfil the promises he made as Candidate Kidero, Dawa ya Nairobi. As we all know, the rot in the city dates back to independence and expecting one man to slay this ogre in two years is expecting a miracle. The writer comments on topical issues

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Securing Kenya a tough job that must be done

enyans are unhappy with rising cases of terrorism in the country. The agony of losing loved ones and the destruction of property and industries such as tourism calls for immediate action. However, the action needs to be thorough and comprehensive. We should have seen these destructive elements coming a long time ago though. We should have realised that our poor management of politics and economics was bound to have adverse consequences. The current quagmire has been cumulative. Look at it this way, Somalia has been a mess for long. Global terrorism has been growing in stature and reach.

EDWARD MUDIBO AGRICULTURE

he Jubilee Government deserves plaudits for the bold steps it has taken to revolutionalise the agriculture sector with a new policy document now in the final stages of preparation. Dubbed the Agricultural Policy Draft III, the document offers a roadmap on how best the agriculture sector can efficiently be used to boast the economy and hopefully spark an agrarian revolution. Kenya heavily relies on agriculture for sustenance and growth. The sector contributes about 40 per cent of GDP. Further, 70 per cent of Kenyans get their livelihood from agriculture. In a bid to address several issues ailing the sector, last year the government embarked on a task aimed at coming out with a policy to oversee the sector and provide a base for further legislation. The draft policy is now with the Cabinet Secretary in charge of Agriculture awaiting presentation to the Cabinet for discussion.

Proposals harmonised

Unemployed people Our population has also been growing rapidly and so have unemployed armies of people. Corruption, on the other hand, has been on the rise disfranchising Kenyans in the process. There are many Kenyans whose loyalty to the country depends on who ﬁlls their stomachs or makes life more bearable. With rising levels of hopelessness and low economic engagements, if any, many youths would not hesitate to throw patriotism to the dogs for any gain or means of basic survival. Leaders of Al-Shabaab and other criminal groups know that building networks in poverty stricken nations is easy. Further, criminal and terror groups permeate societies with high levels of corruption such

D≥aft ag≥icultu≥e policy needs mo≥e stakeholde≥ input

Friends and relatives of Garissa University College terror victims gather at Victoria Park in Kisumu to pay tribute. FILE as Kenya more easily; building networks and capacity needed to wreck them. This is the conundrum that Kenya ﬁnds itself in. We are paying a heavy price for corruption while a pool of able- bodied people have no faith in nationhood as they have little or nothing to gain from their country. We have armies of people with little or no economic activities to do, as a result they have lost their self-worth. We can’t surely expect to roll forward the wheel of progress when many Kenyans are mere observers of economic activities. A dysfunctional society with low

values, mass want amidst a privileged few is a powder keg waiting to explode. Having said that, to tackle the terrorism plight is to dig in for a ﬁght. The only language that criminals understand is a tooth for a tooth.

Soft power approach But this does not entirely solve the problem. As we return ﬁre we must also destroy the criminals’ bases and capacity. This still does not solve the problem, the government must also put in place a comprehensive soft power approach. Unless we give hope to Kenyans

through proﬁtable economic engaged we are not secure. It’s diﬃcult to deal with a person who has nothing to lose. This has been essentially the problem with Somalia. The country has a mass of people who care nothing about it, having endured a journey of hopelessness for decades. Making Kenya secure is not an easy job, but it must be done — whatever it takes. Meanwhile, we have to sort out our internal mess. We are a corrupt lot amid massive hopelessness. We can’t go on like this.

HARRISON MWIRIGI IKUNDA, Nairobi

The draft policy is a good document that can steer the country forward if well implemented. However, some issues were not put into consideration when various proposals were being harmonised, according to some stakeholders. A consortium of about 50 stakeholders grouped under the Agricultural Industry Network (AIN) contends that the draft has inadequacies which need to be addressed before it is discussed, debated and approved as policy for use. As the chairman of this consortium, we have petitioned the CS Agriculture to shelve plans to present the draft policy until key inputs are considered for inclusion. One of the main issues of concern is failure to analyse capital as a factor of agricultural production. There is also no analysis of entrepreneurship as a factor of agricultural production. Further, labour is only analysed brieﬂy without data or evidence. Also, marketing and marketing systems are discussed in brief and without data and evidence with marketing intermediaries being captured as exploitative. Analysis of food distribution systems should indicate weaknesses, constraints and impacts and should have been given more attention. The policy is silent on cheap imports yet it guarantees social welfare in terms of food safety for agricultural products, animal and human health and environmental conservation. Also, the policy does not analyse the present situation in the agriculture sector. Mudibo is chairman of the Agricultural Industry Network (AIN) and also MD of East African Tea Trade Association (EATTA).

BUSINESS DAILY | Friday April 17, 2015

NEWS INDEPTH

Wo≥kho≥se jumbo jet faces a make o≥ b≥eak yea≥ at Boeing, Ai≥bus TURBULENCE Slump in sales of the aircraft raises questions over how long

manufacturers can sustain production as industry shifts towards smaller planes BY ALWYN SCOTT AND TIM HEPHER

The jumbo jet, for many years the workhorse of modern air travel, could be close to running out of runway. Last year, there were zero orders placed by commercial airlines for new Boeing 747s or Airbus A380s, reﬂecting a fundamental shift in the industry toward smaller, twinengine planes. Smaller planes cost less to ﬂy than the stately, four-engine jumbos, which can carry as many as 525 passengers. The slump in sales of the jets has raised questions over how long manufacturers can sustain production. It has also fuelled internal debate in both companies over the future of the planes, sources said. The outcome of those discussions will

affect the value of existing fleets and thousands of production jobs at the plane makers and their many parts suppliers. Sales forces at Airbus Group NV (AIR.PA) and Boeing Co (BA.N) are fighting for potential orders plane by plane as they seek to keep production going beyond the end of the decade, said other aviation market sources. The aircraft makers are offering discounts of at least 50 per cent from catalog prices of around $400 million for a jumbo jet, those sources said. Airbus has said it is also considering a revamp to make its “superjumbo” more attractive to buyers. Boeing in September plans to slow the pace of production of its latest 747-8 model to an average of 1.3 planes a month from 1.5 currently.

The crunch, though, will come earlier because it can take up to two years from ordering the first part to finishing a jet, and no one wants to start the process if it is unclear whether the plane will be completed and delivered to a customer. “I can see demand for the 747-8 in small numbers, but you have got to ask if they can keep the production line open if they don’t get some new orders,” said Tony Whitty, chief executive of UK-based aircraft re-marketing firm Cabot Aviation, which trades, manages and leases jets. “You also wonder at what price they are selling.” Use of the 747 has dropped steadily over the last two decades, reflecting the rise of two-engine jets that have come close to matching its range. Over the same period

GREEN BUILDING SOLUTIONS

‘Revolu onizing Sustainable Building’

The EastAfrican the region’s authoritative weekly newspaper will in the issue of 25th April publish a feature on Green Building Technology. This aims to address:• Waste reduction, pollution and environmental degradation. • Improved efﬁciency in the use of energy, water, and other resources • Importance of green building technology on occupants health and productivity. For further information contact: David: Tel; +254 720 684 854, Email; dwanyonyi@ke.nationmedia.com OR Edward Tel; +254 724 854525, Email; engarega@ke.nationmedia.com

An American Airlines Boeing 737. There were no orders placed by commercial airlines for new Boeing 747s or Airbus A380s last year. AFP

THE FIGURES 1.3 Boeing in September plans to slow the pace of production of its latest 747-8 model to an average of 1.3 planes a month. Last year, Boeing booked 283 new orders for the 777 and now has a backlog of 547 orders, Airbus has 161 orders for the planes in hand, or more than ﬁve years of production. But it acknowledges that not all of those jets will be delivered, leaving it with barely three years of guaranteed output.

production of large twin-engined jets like the Boeing 777 has risen seven-fold. Last year, Boeing booked 283 new orders for the 777 and now has a backlog of 547 orders. Airbus is more upbeat than Boeing about the prospects for jumbo jets but both now agree it has become a niche category. Airlines still need jumbo jets but only for certain polar flights — where a two-engine jet may be less safe than a four-engine jumbo because of the lack of places for an emergency landing— and busy routes where landing slots are scarce. The risk is most visible for Boeing, where investors could face a $1 billion accounting charge if 747 production is shut down, according to company disclosures. Boeing recently received a high-profile boost with a provisional order for two new jets to serve as Air Force One for the US President but the 747’s future depends a lot more on sales of the much-less glamorous windowless freight model. That has a unique hinged nose and can carry very large equipment, such as oil drilling rigs. So far this year, Boeing has sold three. Atlas Air Worldwide (AAWW.O) recently said it plans to order more for its cargo fleet, but wouldn’t say when or how many. The world’s biggest 747 freight customer, Cargolux also says it likes the plane, but has a pending order for only three. A sustained upturn in air freight traffic could secure the 747 a longer future. International freight traffic rose 4.8 per cent last year, but volume has only just recovered from a collapse in 2009 during the financial crisis. Boeing reckons some 143 older freighters will need to be replaced, stretching demand for the 747 through the 2020s, the programme vice-president, Bruce Dickinson, said in an interview. “We know there is a long-term market for this airplane and some of the unique things it can do,” Dickinson said from his office overlooking the 747 production line at the giant Everett plant near Seattle. But Boeing’s effort to sell new 747s is overshadowed by the many older 747s available for lease, which have suddenly been made

Friday April 17, 2015 | BUSINESS DAILY

NEWS INDEPTH S PAC E C R A F T

REUTERS

Space X’s Falcon 9 rocket lifts off at Cape Canaveral, Florida. Uncertainty hangs over use of Russian rocket engines for US national security launches . AFP

more attractive because of a big slide in fuel prices since the middle of last year. Leasing companies say there is scant interest in new 747-8s when 82 freighters are baking in desert parking lots. The older planes can be leased for as little as $400,000 a month, compared with up to $1.4 million in monthly lease payments for a new 747-8 freighter, experts say. “That’s a pretty big difference,” said Gueric Dechavanne, vice-president at Collateral Verifications, a Connecticut-based aircraft appraisal firm. Some companies have extended 747 leases for three to four years, said Aengus Kelly, chief executive of leasing company AerCap (AER.N). “It’s a challenge to lease a freighter,” Kelly told Reuters. “It’s definitely a challenge to sell them.” Airbus’s A380 is a newer plane —its first flight was almost exactly 10 years ago— and has become a mainstay of Middle East carriers that offer opulent suites to first class passengers. But the drop in demand is prompting Airbus to weigh whether to revamp the plane with new engines, or carry on with the existing model. Airbus has 161 orders for the planes in hand, or more than five years of production.

But it acknowledges that not all of those jets will be delivered, leaving it with barely three years of guaranteed output. Given the long lead times, Airbus must bring in more orders soon to avoid having to taper production. “We are always looking at product improvements, but there is so much untapped potential in the existing aircraft,” said Airbus marketing head Chris Emerson. Airbus could announce an A380 revamp as early as the Dubai Airshow in November, but must first find a way to assure investors it can recover several billion dollars of development costs, sources said. Analysts say on option could be to apply for more European government loans, though that risks exacerbating trade tensions with the United States. Top customer Emirates is offering to double its planned purchase of 140 A380s if Airbus carries out the improvements, which the Dubai carrier’s Chief Executive Tim Clark tells Reuters will be “extremely good for the (airline’s) bottom line.” But Airbus’s board is unlikely to back a new A380 model for just one customer. -REUTERS

Journalists tour the ﬁrst class section on the Etihad Airways A380 Airbus superjumbo at Abu Dhabi airport last year. The jumbo jets have been a mainstay of Middle East carriers that offer opulent suites to ﬁrst class passengers. AFP

Unce≥tainty ove≥ engine may stall Lockheed pa≥tne≥ship A joint venture of Lockheed Martin Corp and Boeing Co on Wednesday said uncertainty over its use of Russian rocket engines for Air Force satellite launches could undermine its plans to build a new rocket with a US engine. Tory Bruno, president of the United Launch Alliance joint venture, told Reuters that Lockheed and Boeing could halt investment in the new rocket unless ULA gets permission to use 29 already ordered Russian engines for Air Force launches. The company has pegged its future to the new Vulcan rocket, which it hopes to use for commercial and government launches. It was not immediately clear what would happen to the ﬁrm if it was unable to complete the new rocket. Bruno said the company’s board last week approved investment in Vulcan through the end of the year but would not consider further funding until the issue of the Russian RD-180 engines that power its Atlas 5 rocket was resolved. Legislation passed by the US Congress last year barred ULA from using engines for national security launches purchased after Russia’s annexation of Ukraine’s Crimea. ULA signed a 29-engine contract with Russia’s Energomash before then, but Pentagon lawyers have determined that those engines cannot be used under the current law. Air Force oﬃcials have urged Congress to change the

law. Bruno said the Air Force is also pursuing a waiver from the Pentagon that would allow the engines’ use. Bruno said lawmakers did not intend to halt use of the rockets already ordered by the company, and they had not expected the legal determination later made by Pentagon lawyers. Barring a change, Bruno said ULA would be unable to compete for some Air Force orders that comprise a large part of the company’s business between 2019 and when the new rocket is certiﬁed to launch government satellites around 2022 or 2023.

Competitor The Air Force expects to certify a new competitor, privately held Space Exploration Technologies, to compete to launch some US military and intelligence satellites by June. ULA is halting use of most of its Delta 4 rockets, which have a US-built engine, because they are too costly to produce and would not be competitive, Bruno said.He said the company could have up to ﬁve RD180 engines available for use after 2019, but it was unclear if the company could aﬀord to stockpile engines valued at $125 million Meanwhile, Airbus Group will ask shareholders to approve an exceptional share buyback of up to 10 per cent of its capital at its annual meeting on May 27, the aerospace

group said on Wednesday. The move is designed to allow the board of Europe’s largest aerospace company flexibility to distribute part of the proceeds from divestments, it said in a statement. The exceptional buyback comes on top of a separate share repurchase programme covering up to 10 per cent of the company’s capital, which would be renewed under a separate resolution. The existing programme is mainly linked to employee share schemes. Airbus Group does not intend to hold more than 10 per cent of its own share capital as a result of both buybacks, it said, adding that the shares acquired through the exceptional buyback would be “promptly canceled”. Airbus is also pressing ahead with previously announced plans to adopt “European Company” status. Holding company Airbus Group N.V. would be renamed Airbus Group SE and would keep its registered seat and head office in Amsterdam. “The main purpose of this move is to reflect, in its legalform, the diversified operational presence of the group in different European countries,” the statement said. The planemaker would remain listed in Paris, Frankfurt and Spain. A European Company is governed by European Union law that is applicable in all 28 member states.

BUSINESS DAILY | Friday April 17, 2015

Corporate and Project FINANCING IN KENYA

SPECIAL ADVERTISING SECTION

Capital markets give options for young ﬁrms with growth plans By EVANS ONGWAE >>> eongwae@ke.nationmedia.com

uccessful companies not only have skilled people at all levels, but they also have enough funding to execute their plans and support their operations. Most companies need cash to purchase land, buildings, equipment, and materials with the capital structure being a mix of debt and equity used to finance the firm. Companies can reinvest a portion of their earnings, but most of the growing ones must also raise additional funds externally by selling stock, borrowing in the financial markets or both. As the firm grows, it will need factories, equipment, inventory, and other resources to support its growth. In time, the entrepreneurs usually deplete their own resources and must turn to external financing. Many firms have financing arrangements with banks that provide them the capital they need to expand their operations.

However, many young companies are too risky for banks, so the founders must sell stock to outsiders, including friends, family, private investors (often called angels), or venture capitalists. If the startup company continues to grow, it may become successful enough to attract lending from banks, or it may even raise additional funds through an initial public oﬀering (IPO) by selling stock to the public at large. After an IPO, corporations support their growth by borrowing from banks, issuing debt, or selling additional shares of stock. In short, a corporation’s ability to grow depends on its interactions with the ﬁnancial markets. In a free market economy such as Kenya, capital from those with available funds is allocated through the price system to users who have a need for funds. The interaction of the providers’ supply and the users’ demand determines the cost (or price) of money, which is the rate users pay to providers. For debt, this price is called the interest rate. For equity, it is called the cost of

equity, and it consists of the dividends and capital gains shareholders expect. A firm may borrow money by issuing notes or bonds. Both are certificates of indebtedness, which are written obligations of the borrower to repay the amount borrowed under specified terms. Many firms have in recent years been trooping to the Nairobi Securities Exchange (NSE) to raise funds for their expansion projects. This has demonstrated that well-established capital markets – attained by increasing the quantity and productivity of investment, enabling local enterprises raise finance, stimulating competition in the financial sector, and improving corporate governance – can hasten the mobilization of domestic and foreign capital, accelerating a country’s economic development. From a firm’s perspective, the role of a capital market is to be a liquid market where firms can interact with investors to obtain valuable external financing resources. From investors’ perspectives,

the role of a capital market is to be an eﬃcient market that allocates funds to their most productive uses. This is especially true for securities that are actively traded in broker or dealer markets, where the competition among wealth-maximising investors determines and publicises prices that are believed to be close to their true value.

A firm may borrow money by issuing notes or bonds. Both are certificates of indebtedness, which are written obligations of the borrower to repay the amount borrowed under specified terms.

HOUSING FINANCE SEES PROJECT FINANCING AS A KEY PLANK OF ITS GROWTH AGENDA retail shopping centers, industrial usage, hospitality and educational use. The company has financed a number of notable projects across the country including Links Road Plaza; a development comprising a six story office block located in the prime Nyali area of the North Coast and the Professor Nelson Awori centre in Nairobi, a building comprising of five floors on two wings with 97 parking spaces.

enabler in the property industry.

These efforts form the foundation of the 2012-2016 expansion strategy crafted to promote expansion and growth at not only a bank level, but at a county level.

Through its established Project Finance arm, Housinf Finance are at the pinnacle of developing a variety of large scale properties for both small and large property developers, but this is only the tip of the proverbial ice berg, sentiments expressed by Housing Finance Managing Director Frank Ireri.

More recently the company has branched into the retail sector, with the funding of Buffalo Mall located in Naivasha, Nakuru County. Buffalo Mall is the only mall in Naivasha and was financed using a Forex financing model, representing a new school of thought by the Mortgage Giant, a new frontier that may prove to be the key in unlocking property development in the Counties. Cedar Mall in Nanyuki, Laikipia County, and the biggest development of its kind in the region has recently broken ground, in part due to the Kshs 820 million capital injection provided by Housing Finance.

The project Finance activities of Housing Finance span across a range of property types including office space,

All these projects are an indication of Housing Finance’s commitment to remain as the leading integrated solutions

The past twenty years in Kenya have seen a new wave of interest in project financing as a tool for economic investment. While it is commonly accepted that project finance assists in the financing of new investments through the structuring of financing around the projects own operating cash flow and assets, without additional sponsor guarantees- this is often easier said than done. Integrated Property Solutions provider, Housing Finance has provided diverse and cohesive solutions that meet the constantly evolving needs of the public; showing a devotion to the delivery of cohesive services in-line with the embryonic needs of Kenya at large.

‘This however, is not the end for Housing Finance, but rather the beginning of a new direction on the quest to remaining the leading integrated solutions enabler for the property industry, evident by our latest endeavor,’ commented Housing Finance Managing Director Frank Ireri.

‘These efforts craft the foundation of the compassionate and consumer centric approach that Housing Finance has shown time-and-time again. Through collusion and consultation with County Governments, Housing Finance hopes to pioneer, champion and advance the various development agendas. Ultimately focusing on the creation of a conducive environment for residents and investors alike,’ expresses Frank Ireri on the subject.

For more information on Project Financing and Structuring call us on Housing Finance is regulated by the Central Bank of Kenya

Friday April 17, 2015 | BUSINESS DAILY

SPECIAL ADVERTISING SECTION

BUSINESS DAILY | Friday April 17, 2015

Corporate and Project FINANCING IN KENYA

SPECIAL ADVERTISING SECTION

Project ﬁnancing made easier

onstruction activities require a lot of capital to execute. One of the most critical steps in planning for construction is identifying the most suitable source of funding. The recent increase in construction activities in Kenya, has seen an increase in demand for project financing. Unlike corporate financing, which is based on historical performance, project financing is more dependent on expected future cash flows of the project and the credibility of the delivery team. Given that the projects have a limited lifetime, they are often carried out under the banner of a Special Purpose Vehicle (SPV), an outfit specially set up to engage

At Mwanzoni Limited, we do feasibility studies, carry out detailed ﬁnancial modelling for client’s projects and then help them secure project ﬁnance.

in a particular project. A financier usually demands for certain conditions to be fulfilled by a potential borrower. This includes a certain minimum equity contribution, a feasibility study and an experienced delivery team to mitigate risk. These terms are very critical to a borrower since they greatly affect the project cost and the completion period. Most banks in Kenya give 70% of the basic construction costs. It is possible to negotiate better terms and lower interests depending on your project and the project team. A moratorium in a loan agreement, which enables you to defer payments until a later period when project can generate enough cash flows to service the loan, is also a key consideration. Other than banks, private equity investors are also increasingly putting money into construction. Project finance is different from private equity investments which are often speculative assessments of a company’s potential to generate returns. Project financing is predicated on robust, long term and

Typical Bank Terms

Source: Mwanzoni Desk Research from Public Domains. highly predictable ﬁnancial modelling of forecasted cash ﬂows. At Mwanzoni Limited, we do feasibility studies, carry out detailed

ﬁnancial modelling for client’s projects and then help them secure project ﬁnance. If you need to talk to us, email communications@mwanzoni.com

Friday April 17, 2015 | BUSINESS DAILY

BUSINESS DAILY | Friday April 17, 2015

REGIONAL NEWS STANCE Party terms xenophobia shameful as over 1,000 foreigners seek refuge in camps

DAR ES SALAAM

ANC condemns wave of attacks on immig≥ants against the xenophobic violence. South Africa’s ruling African National Congress (ANC) party has condemned Durban’s impoverished townships a wave of attacks against immigrant have been at the heart of the recent shopkeepers that has left at least six clashes between locals and immipeople dead and exposed sharp social grants, following a similar spate of tensions in the country. attacks on foreign-owned shops in The spate of attacks has targeted Soweto, near Johannesburg, earlier shops and homes owned this year. Over 1,000 foreigners by Somalis, Ethiopians, in Durban have ﬂed their Malawians and other imhomes and are now livmigrants, despite heavy These a≥e ing in makeshift camps police patrols in the southc≥iminal acts ern city of Durban and surunder police guard. In one camp, Tarcisse rounding townships. against vulne≥able Balole, 34, from Congo, “Over the last couple of and defenceless was nursing 36 stitches weeks our nation has been people engulfed in a shameful wave in his head after being of attacks by some amongst attacked by stick-wieldANC STATEMENT us against our country’s ing assailants in his spice shop on Friday. immigrant population,” “They said they the ANC, which has ruled South Africa since the end of apartheid would come and kill me. They took in 1994, said in a statement. everything,” he told AFP. On Wednesday, many shops in the “(These are) criminal acts against vulnerable and defenceless people who centre of Johannesburg were shut as have sought refuge, solace and ecoowners feared that violence could nomic prosperity in our country. The erupt after threats spread via social very real challenges faced by the South networks and phone text messages. African people... cannot be blamed on “I’ve (been) 15 years here,” Milion people of foreign nationality.” Kassa, a 34-year-old Ethiopian shopThe ANC statement came after ackeeper, told AFP. cusations that President Jacob Zuma “What did we do wrong except has failed to take a public stance work hard to improve our lives? And

10 Al-Shabaab suspects held, one lynched in Tanzania Tanzanian security forces have arrested 10 suspected members of the Somali Islamist group Al- Shabaab in a raid on a mosque and another was lynched by a mob, police said on Wednesday. Ofﬁcials said Tanzania was on high alert after the group claimed responsibility for an attack on a university in neighboring Kenya this month that killed 148 people. Police Commissioner Paul Chagonja told Reuters the suspected members group had been arrested on Tuesday night in Kilombero district, Morogoro region, about 200 km east of the commercial capital Dar es Salaam. An immigrant holds a machete to protect himself after locals attacked foreigners in Durban. AFP are the police saving us? No.” Violence against immigrants in South Africa is common, with unemployed locals accusing foreigners of taking their jobs. In 2008, 62 people were killed in similar violence in Johannesburg townships. Neighbouring Mozambique is planning to help some of its citizens ﬂee from Durban, the largest city in KwaZulu-Natal province, after Malawi announced its own repatriation plan on Monday. “We have an experience which worked well in 2008, and it’s ready to work again,” Mozambican Foreign Minister Oldemiro Baloi told a press conference on Tuesday night. King Goodwill Zwelithini, traditional leader of the biggest ethnic group in KwaZulu-Natal, has been blamed for fanning the attacks after a speech two weeks ago in which he told immigrants to go home. On Wednesday, his representative condemned the attacks and denied the

king had any responsibility for fuelling anti-immigrant sentiment. “The king is saddened by what is happening. He never thought something of this nature could happen,” Prince Thulani Zulu, speaking in Durban on behalf of the king, told AFP. “The king condemns this, this is criminal.” Last month, the king gave a speech in which he was reported to have demanded that immigrants “pack their bags and leave”. Since then, six people have been killed in clashes between locals and foreigners in and around Durban, and 74 people have been arrested. Police said Wednesday that the latest death was a 14-year-old boy killed in KwaMashu, a township north of Durban. “We are trying to educate our people about the impact of what they’re doing,” said Mkululi White, of the Protection of Foreign Business and Citizens action group. -AFP

Buha≥i’s Nige≥ia oil policy to focus on ≥efo≥m fi≥st, taxes last Oil firms keen to know how Nigeria’s president elect Muhammadu Buhari plans to tax them could be waiting a long time as he makes ending corruption and reforming the opaque national oil company his most urgent sector priorities. Four party sources from Buhari’s All Progressives Congress (APC) told Reuters the issue of fiscal terms, seen as crucial by the industry, will have to wait on current thinking about oil and gas policies for Africa’s leading producer. Crude output has stagnated close to two million barrels per day over the past few years, owing partly to underinvestment. “We need to address the structural issues and leave the fiscal for now,” Senator Bukola Saraki, whose APC party controls both houses of parliament after a landslide win, told Reuters.

Shell’s oil and gas terminal on Bonny Island , Nigeria. FILE “A more transparent NNPC (Nigeria National Petroleum Corporation) is needed with reasonable accounting,” he said. Buhari owes his March 28 victory against incumbent Goodluck Jonathan partly to a perception that Jonathan allowed corruption to get out of

BRIEFING

control-especially in the oil sector. A string of multibillion dollar oil corruption scandals tainted the NNPC and other bodies that handle energy. By contrast, Buhari was seen as one of the few Nigerian leaders to have cracked down on corruption during his military rule in 1983-1985. Many Nigerians hope he will again. “The worry is that there’s going to be a lot of time wasted in witchhunting...That could take a year in which nothing else will happen,” said a Nigerian investment banker focused on upstream oil and gas projects, who declined to be named. APC leader Bola Tinubu, whose support was instrumental in Buhari’s victory and wields huge inﬂuence, told Reuters a transtional committeee would be set up. “No way will we discuss that now,” he said. Jonathan’s administration re-

drafted a Petroleum Industry Bill (PIB) in 2012 that had been in the works for a decade. The PIB was meant to change everything from fiscal terms to overhauling the NNPC, environmental rules and revenue sharing, but its comprehensive nature caused disputes between lawmakers. Yet the main thing the oil companies were worried about was tax. The bill proposes 20 per cent tax on offshore projects and 50 per cent for onshore. Shell, Exxon and other majors had all complained publicly that the terms are unfair, given the risk associated with operating in Nigeria. Uncertainty over the fiscal terms of the bill have been holding back billions of dollars of investment, especially into capital-intensive deepwater offshore, leading some to propose the Bill be broken up into several pieces debated separately. -REUTERS

MIAMI 6,000 Sierra Leone health workers to get Ebola vaccine Thousands of healthcare workers in areas of Sierra Leone that are grappling with Ebola will now begin receiving an experimental vaccine against the often deadly virus, ofﬁcials said. The vaccine candidate, rVSV-ZEBOV, was developed by the Public Health Agency of Canada and licensed to NewLink Genetics and Merck pharmaceuticals. It will be given to 6,000 healthcare workers and other frontline personnel in the ﬁght against Ebola over the coming months, the US Centre for Disease Control and Prevention (CDC) said in a statement.

GENEVA 350 immigrants feared dead after boat capsizes near Italy Hundreds of people desperate to be rescued from a packed migrant boat in the Mediterranean pushed to one side when they saw a ship approach, capsizing the craft and pitching everyone into the sea where hundreds died, an ofﬁcial said on Wednesday. Survivors’ accounts suggested at least 500 people were on the boat when it sank on Monday evening, some 120 km off the Italian island of Lampedusa. With 145 people rescued that leaves at least 350 unaccounted for, probably drowned. Joel Millman, spokesman for the International Organisation for Migration (IOM), said: “According to testimonies, at least one-third of the passengers were women and children.”

JOHANNESBURG Power blackouts engulf SA as utility resumes rationing South African utility Eskom resumed widespread power cuts on Wednesday, leaving millions without electricity for a fourth day in a row but a government minister ruled out the chances of a total blackout. Africa’s most advanced economy is in the middle of its worst electricity crisis since 2008 and South Africans are subjected to frequent controlled blackouts, which Eskom implements to prevent the grid from collapsing. South Africa on Tuesday lost a quarter of its power supply in one of its worst power outages in years in both scheduled maintenance and plant breakdowns. Some supply had been restored by Wednesday, but the power outages remained widespread.

Friday April 17, 2015 | BUSINESS DAILY

MONEY & MARKETS NEWS I REVIEWS I ANALYSIS

B≥oke≥s in new legal battle against capital gains tax

Equity sha≥e now t≥ades at 8-month low BY CHARLES MWANIKI

DISPUTE Stockbrokerages say judge relied

on repealed law and want a review of ruling Exchange (NSE) investors pay a ﬁve per cent tax on gains made from any Stockbrokers have renewed the le- share sale at the stock market. gal battle against the capital gains Kasib wants the court to declare tax (CGT) by ﬁling an application section 35 which relates to CGT unclaiming that the High Court relied constitutional, saying it is vague and on a repealed provision of the Finance contradictory. Justice Ngugi in her Act to throw out their case. judgment said a set of guidelines pubThe Kenya Association of Stock- lished by KRA cleared any provisions of the Act that were brokers and Investment Bankers (Kasib) is seeking contradictory, hence a review of Justice Mumbi upheld the charging of Ngugi’s judgment that last the levy. The p≥ovision month struck out their peStockbrokers argue ≥elied upon by the that they are caught tition against the CGT. Kasib claims its lawyer between a rock and a judge had been Kiragu Kimani discovered hard place as collec≥epealed by section tion of CGT will expose the provisions the judge 26 of the Finance them to lawsuits from relied on were repealed investors, while failin 2006 to exempt inAct 2006 vestment shares. ure to charge the levy KASIB “The provision relied will leave them at risk of being charged in the upon by the judge had been repealed by section 26 of the criminal court. Justice Ngugi after delivering her Finance Act 2006 and is therefore no longer in force. After the repeal judgment stopped KRA from impleof section 35(A) and (B) it is not clear menting the CGT so as to allow stockunder which provision of section 35 brokers a chance to appeal the case. members could collect and remit The lobby says the order lapsed on April 10, and the taxman may seek CGT,” Kasib said. The levy will see Nairobi Securities dues any time unless the court interBY BRIAN WASUNA

Investment brokers on the trading floor of Nairobi Securities Exchange. FILE venes. “As a result of the mistake, the court dismissed Kasib’s argument and this places its members at risk of arbitrary criminal prosecution for failure to collect and remit CGT as provided for under the Act,” Kasib added. Justice Weldon Korir yesterday certified the application urgent, but declined to extend Justice Ngugi’s orders. He ordered Kasib and KRA to file their various responses and arguments before May 4 when they will appear before Justice Ngugi for a hearing. Mr Kimani had asked the court to extend the interim orders Justice Ngugi granted last month until the court makes a final decision so as to save stockbrokers from the taxman ahead of concluding the case.

“KRA officials are likely to take enforcement action against Kasib’s members before this application is heard and determined,” he said. The broker’s renewed fight comes two months after the National Treasury shifted the burden of collecting the CGT from stockbrokers to investors. Finance Cabinet secretary Henry Rotich said legislation to confirm the shift is in the works, and should be complete by the next financial year starting July. The Treasury made the decision after stockbrokers raised concerns over their capacity to collect the tax due to lack of adequate personnel and difficulty in verifying gains made by investors in some transactions. bwasuna@ke.nationmedia.com

Equity Bank stock has traded at an eight-month low of Sh46 for the past two trading sessions with analysts pointing at investor concern over the financial cost of its planned regional expansion. The share has fallen by 11.5 per cent in the past one month under selling pressure from investors. Equity is now valued at Sh170.3 billion, which has allowed KCB to open up a gap of Sh23.6 billion in valuation at Sh193.9 billion. “The lender (Equity) is planning a 10 country expansion which has seen it take up Sh36 billion in loans, create 411.4 million new shares and hint at a potential rights issue. The news may have attracted negative sentiment considering that its five subsidiaries only contributed 4.8 per cent of profit before tax in the 2014 financial year,” said Standard Investment bank in a market note. Despite both share prices remaining unchanged yesterday, the lenders were the top movers in the market. KCB saw 4.18 million shares worth Sh271.7 million change hands, while Equity traded 2.3 million shares worth Sh106.6 million. They jointly accounted for 64 per cent of the total market turnover of Sh590.5 million. The NSE 20 share index closed 47 points lower at 5078, mainly due to declines in the share prices of BAT and Athi River Mining (ARM).

Citi sees Tullow selling Kenya oil ahead of its Uganda p≥oduction BY GEOFFREY IRUNGU

Kenya is likely to take its ﬁrst oil to the international market before Uganda, which discovered hydrocarbons six years earlier, Citi investment bankers say. While Tullow Oil Kenya has previously given 2017-2018 as the likely date of production for Kenya, the analysts said this can only happen towards the end of 2020 while for Uganda it will start by 2021. Kenya’s production and export would help Uganda as a pipeline will be ready by the time its oil is ready for sale, the analysts said. Uganda has faced hurdles in its bid to exploit the resource despite having made discoveries in 2006 due to

disagreements on production sharing laws, lack of an export pipeline and a reﬁnery. According to Citi, most growth in revenues for Tullow Oil after 2018 will come from Uganda and Kenya. “Beyond 2018, further production growth will be driven by the delivery of the Ugandan export development and the development of the recent discoveries in the Lokichar Basin in Kenya,” said Citi. The analysts said commencement of Kenya oil exports and a pipeline will provide guidance on how to proceed with exports in Uganda. “Progress with the Kenya export development will provide greater clarity and viability to the Uganda export project, which will tie into the Kenya

Oil export While Tullow Oil Kenya has previously given 2017-2018 as the likely date of production for Kenya, the analysts said this can only happen towards the end of 2020 while for Uganda it will start by 2021.

pipeline,” says Citi. In its recently released annual report for 2014, Tullow Oil management said the final decisions on the export pipeline will be made this year. “The governments of Kenya and Uganda are also working together on the export pipeline and have recently appointed a joint technical adviser,’’ noted the Tullow annual report. ‘‘It is expected that a final decision on the route and commercial structure for the pipeline will be determined in 2015 allowing the regional project to be jointly sanctioned around the end of 2016,” the report read in part. Citi analysts said Tullow Oil could sell (farm out) stakes in its Uganda and Kenya developments to help finance production in the discovered reserves

and also reduce the amount of debt or leverage. “We see borrowing levels peaking in 2016…The successful farm-out of future developments (Uganda and Kenya) could bring forward the value from these projects and see Tullow delever more quickly,” said Citi. US-based investment bank Goldman Sachs was reported by London’s Financial Times saying Tullow Oil was a candidate for a takeover because of its exposure to strategic hydrocarbon assets at low costs in Africa. Goldman’s “buy” advice sent Tullow 8.7 per cent higher on Wednesday. But the story also quoted analysts at Jeﬀeries, another US-based investment bank, as saying that Tullow Oil shares was too expensive to attract buyers.

BUSINESS DAILY | Friday April 17, 2015

MONEY & MARKETS

Nai≥obi among counties defying spending ≥ules

Shilling slips as impo≥te≥s seek dolla≥s, sha≥es dip

Controller of Budget says they spent revenue without depositing in banks ﬁrst FINANCE

BY GEOFFREY IRUNGU

Nairobi, Homa Bay and Trans Nzoia topped the list of counties that spent cash irregularly in the first half 2014/ 15, data from the Controller of Budget (CoB) shows. While Nairobi spent Sh2.3 billion, Homa Bay and Trans Nzoia overshot by Sh716 million and Sh282 million, respectively, without first surrendering the cash to the County Revenue Fund (CRF) as required by law. In percentage terms, Nairobi exceeded the amount reflected in the revenue account by 36.3 per cent, while Tana River and Trans Nzoia surpassed by 26.3 and 25.5 per cent respectively. The counties spent the cash directly after collecting it without remitting it first. Before the money

leaves the CRF for spending, it is supposed to be authorised by the Controller of Budget, Agnes Odhiambo. Other counties mentioned in the list are Machakos and Murang’a for spending cash before depositing it at the CRF. During the six-month period, six counties (Nairobi City, Homa Bay, Machakos, Murang’a, Meru and Trans Nzoia) reported higher expenditure than the amounts approved by the CoB. ‘‘The oﬃce established that these counties did not deposit all locally generated revenue into the CRF as required by Article 207 of the Constitution, but instead, spent the funds at source,” said Mrs Odhiambo. She further said that Nairobi even spent cash for development amounting to Sh572 million, yet it

Controller of Budget Agnes Odhiambo. FILE did not request authority to use such funds during the first six months of the 2014/15 fiscal year. “The Nairobi County did not request funds for development activities although they incurred development expenditure during the reporting period. This might imply that funds requested for recurrent expenditure were diverted to finance development activities or local revenue was spent at source on the development activities,” said Mrs Odhiambo. She said her office had made recommendations on how to improve the budget implementation process within Nairobi, but they had not been taken up yet. “The [Nairobi] County is yet

to implement most of the recommendations contained in previous [Controller’s reports] and continues to experience challenges that are aﬀecting budget implementation,” she said. She said the challenges experienced by Nairobi not only had to do with violations of the Constitution and the PFM Act on spending, but also failure to come up with a debt management strategy. “The challenges that hampered eﬀective budget implementation [include] the county is yet to approve debt management strategy to manage its liabilities,” said Mrs Odhiambo. girungu@ke.nationmedia.com

The shilling weakened as some importers sought dollars now based on expectations that the US currency would cost more later in the month. Shares drifted lower. By the close of trading, the shilling was quoted at 93.45/55 to the dollar, compared with 90.30/50 on Tuesday. The shilling has declined steadily in the past few sessions, touching fresh lows not seen since November 2011. Traders said they expected it to fall further, unless the central bank oﬀered support with dollar sales as it did last Tuesday. “The shilling has been trading on weaker sentiment,” said Martin Runo, a senior trader at Chase Bank, citing factors such as a spate of Islamist militant attacks that have hammered tourism, usually a valuable source of foreign exchange. Global dollar strength has also hurt the currency. Mr Runo said some importers, who usually tend to wait till later in the month to purchase dollars, had been seeking the US currency earlier than usual to avoid paying more later. Echoing other traders who also saw the shilling extending losses, Mr Runo said it could hit 93.85 to the dollar this week. On the shares market, the benchmark NSE 20 index dipped 2.0 points to close at 5,126.02 points. -REUTERS

Kenya Powe≥ outshines ene≥gy stocks at NSE BY CHARLES MWANIKI

The Business Daily on 24 April, 2015, will publish an informative report on POS Systems focusing on: th

• POS solution providers • Benefits offered by adoption of a good quality POS system • Recent innovations in POS solutions. • Point of sale software solutions, To advertise in this feature please contact: Martin Kinyua on 0720 380 733 or Tel: Email: mkinyua@ke.nationmedia.com

Kenya Power continues to outperform other energy stocks at the NSE this year, driven by sustained demand from foreign investors. The stock is up 18.7 per cent to Sh17.15 year-to-date—carrying on a trend established in 2014—even as power generating firm KenGen has shed three per cent to Sh10. Kenya Power has been among the leading beneficiaries of foreign investor inflows since the beginning of the year, attracting Sh197 million in net inflows for the first three months of 2015. This is only behind KCB and Co-operative Bank which have net inflows of Sh550 million and Sh436 million respectively. “The appetite for the stock by investors has been strong, bringing the higher gain compared to KenGen for instance. KenGen has delivered more robust numbers compared to Kenya Power, but has not had a similar performance at the market,” said Stand-

ard Investment Bank analyst Eric Musau. Oil marketer stocks Total and KenolKobil have only registered modest movement this year. Total’s share is down 2.1 per cent to Sh23.50, while KenolKobil has gained 2.3 per cent to Sh8.90 this year.

Worst performer Cross-listed Ugandan power distributor Umeme Ltd remains the worst performer in the segment, down 14.5 per cent to Sh17.95 even as it enjoys more trading following last year’s sale of a significant stake held by UK private equity firm Actis. A number of Kenyan investors bought shares from Actis and deposited the units in local CDS accounts last year giving the counter local market float that was previously lacking as the shares were almost wholly in the Ugandan CDSC system. Mr Musau said going forward the fundamentals of both Kenya Power and KenGen are robust enough, with fund rais-

ing not a risk for either ﬁrm even in the face of huge capital expenditure. Utility companies globally are capital intensive due to the required equipment and machinery as well as associated maintenance costs. “Their balance sheets show that they can service their obligations,” said Mr Musau. He, however, said Kenya Power needs to diversify from relying solely on debt and retained earnings for the capital expenditure, and could consider an equity issue. KenGen is planning to do a rights issue to fund new power stations. In the long run, Mr Musau said, KenGen will be buoyed by delivery of power projects, which give the share some upside. Analysts at Genghis Capital say considering the high capital requirements (Sh87.7 billion in 2014), the support the companies receive from the government which is trying to achieve the targeted 5,000 megawatts of power by 2017 is also a big boost to both Kenya Power and KenGen.

Friday April 17, 2015 | BUSINESS DAILY

MONEY & MARKETS GLOBAL

Apple Watch eyed by 6pc of US adults SURVEY Reuters/Ipsos poll shows more

men than women likely to buy the device was interested in buying. About six per cent of US adults plan to “It should serve Apple well if they buy Apple Inc’s smartwatch accordcan even get close to that,” he said. ing to a Reuters/Ipsos poll, with men As far as overall interest in the watch twice as likely as women to purchase Apple boss Tim Cook’s first new major as opposed to intending to buy it, the product. poll showed that 18 per cent of respondents were “very” or “somewhat” interThe poll showed the watch, marested versus 76 per cent who showed no keted by Apple as a high-fashion item as well as a new frontier in technology, interest. Highest interest at 34 per cent appealed to fewer than 4 per cent of was among men aged 18 to 28, the same age and gender bracket women compared with 9 that gave the watch the per cent of men. highest “cool factor” at 53 Ipsos polled 1,829 US Wall St≥eet per cent, compared with adults online between April 8 and 14 about the estimates between an overall 42 per cent. People around the watch, which opened for 10 million and world flocked to Apple preorders last week. The 32 million stores on April 10 to try on poll had a credibility interval of plus or minus 2.6 per wo≥ldwide sales the watches, which go on sale officially on April 24, centage points. in 2015 and online orders quickly If calculated based on outstripped supply, with 2014 US Census projections, and excluding youngmost customers facing at er teens, this could mean potential sales least a month’s wait. of about 15 million watches, if those “I already have the iPhone, the iPad, pretty much everything that Apple ofwho said they intended to buy follow fers,” said poll respondent Sefu Grady, through with an actual purchase. a 37-year- old counsellor living in ClinWall Street estimates had varied ton, Mississippi. He said he was buying widely between 10 million and 32 a basic Sport model for himself and a million worldwide sales in 2015. Van Baker, an analyst at tech research firm mid-range one for his wife for Mother’s Gartner, said the Reuters poll results Day. Apple has not yet said how many indicated a “pretty high per centage” watches have been ordered, but CEO

Apple Watches. FILE Cook described sales as “great.” Shopping data firm Slice Intelligence and brokerage Cowen and Co estimated preorders on the first day at about 1 million in the United States. Samsung Electronics, Sony Corp and LG Electronics have all released their own smartwatches, many of them powered by software developed by Internet company Google Inc. None have given sales figures but independent researcher Smartwatch Group estimates that 6.8 million smartwatches were sold worldwide last year, led by Samsung with about 1.2 million units. The Apple Watch, priced from $349 for a basic Sport model to a $17,000 gold timepiece, lets users check email, listen to music and make phone calls when paired with an iPhone. Reviews have generally praised

its style but criticized battery life and slow-loading apps. According to the poll, adults aged between 30 and 39 were the most likely buyers, with 13 per cent saying they planed to buy an Apple Watch, followed by 10 per cent of 18-to-29-year-olds. Just under a third of respondents said they already own an iPhone. Not surprisingly, iPhone owners are more likely to spend money on the new Apple gadget, with about 15 per cent saying they planed to buy. Among those polled who do not own an iPhone, eight per cent said they would consider switching to an iPhone in order to purchase an Apple Watch. Baker at Gartner said many potential buyers will end up holding oﬀ until the second version of the watch, likely to appear next year. -REUTERS

Tracking the markets: Benchmark Index (Latest Data) Africa USE All Share

JSE All Share Index

Apr‘15

July ‘14

NGSE All share

Tanzania

2,061.57 -0.85%

54,111.12 0.73%

July ‘14

DSE All Share

Uganda

South Africa

Apr‘15

Rwanda

Apr‘15

137.14 0.00%

34,866.68 -0.28%

2,739.56 0.40%

July ‘14

RSE All Share

Nigeria

July ‘14

Apr‘15

July ‘14

Apr‘15

World DJ Industrial

Xetra Dax 12,053.12 -1.46%

18,112.61 0.42%

July ‘14

Apr‘15

July ‘14

Nikkei

HangSeng

Frankfurt

New York

Apr‘15

Mumbai 19,885.77 0.08%

27,739.71 0.44%

July ‘14

Sensex

Tokyo

Hongkong

July ‘14

Apr‘15

28,666.04 -0.46%

July ‘14

Apr‘15

BUSINESS DAILY | Friday April 17, 2015

MARKET DATA Agro Commodities Market Early Morning wholesale commodity prices Date 14.04.2015 COMMODITY Unit Kg Nairobi Mombasa CEREAL Dry Maize Bag 90 2800 3000 Green Maize Ext Bag 115 3400 6800 Finger Millet Bag 90 7300 7900 Sorghum Bag 90 4000 3600 Wheat Bag 90 LEGUMES Beans Canadian Bag 90 6400 Beans Rosecoco Bag 90 6800 7000 Beans Mwitemania Bag 90 6400 6800 Mwezi Moja Bag 90 6400 Dolichos (Njahi) Bag 90 6800 8100 Green Gram Bag 90 12000 9900 Cowpeas Bag 90 7200 6300 Fresh Peas Bag 51 3800 6000 Groundnuts Bag 110 13000 13700 ROOTS & TUBERS Red Irish Potatoes Bag 50 3800 3600 White Irish Potatoes Bag 50 4000 4100 Cassava Fresh Bag 99 2100 1600 Sweet Potatoes Bag 98 3600 3300 VEGETABLES Cabbages Ext Bag 126 2800 3700 Cooking Bananas Med Bunch 22 540 750 Carrots Ext Bag 138 4200 6200 Tomatoes Lg Box 64 6300 6400 Onions Dry net 13 1100 1400 Kales Bag 50 3000 3500 Spring Onions Bag 142 2200 3800 Chillies Bag 38 3500 5700 Cucumber Bag 50 2400 2000 Capsicums Bag 50 3000 1500 Brinjals Bag 44 2100 1300 Cauliﬂower crate 39 2800 3900 Lettuce Bag 51 2600 4000 FRUITS Passion Fruits Bag 57 4800 5000 Oranges Bag 93 3400 3000 Lemons Bag 95 2800 2700 Ripe Bananas Med Bunch 14 620 450 Mangoes Local Bag 126 2700 Mangoes Ngowe Sm Basket 25 1100 1200 Limes net 13 900 850 Pineapples Dozen 13 720 630 Pawpaw Lg Box 54 2000 1200 Avocado Bag 90 2400 1600 OTHERS Eggs Tray 310 300

Kisumu

Nakuru

Eldoret

M&A Recent Deals Completed this Month in Africa

3400 3000 7200 3600

2100 2000 6500 3150

2200 2200 7200 5400 3400

Target Name

8000 7600

6400 6400 4900 4500 6000 10800 7200 5000 12500

11250 11700 6300 2040 12600

4000

2500 2300

3000

2200

13000 8200 2500 10800 3500 3500 2100 2500 2700 300 5000 3500 1040 2000 1500 1400

350 2500 4500 850 3000 1500 3500

6750 6750

2400 1200 1600 5500 1500 1500 780

2600 1350

2500 2500 3000

2500

3000 3000 1600 300 2500 1800

5000 3200 2700 750 2800

3705 3300

900 1200 3300

480 2500 2500

910 3780 1800

360

280

360

Target Nation

Target TF Macro Description

Acquiror Name

Acquiror Nation

Rank Value of Deal ($mil)

Cheetah Logistics SARL

Rep of Congo

Industrials

Frontier Services Ltd

Hong Kong

Zimpeto Square

Mozambique

Real Estate

Delta International

Bermuda

Nigeria

Telecommunications

NATCOM Consortium

Nigeria

252.5

South Africa

Retail

Lovisa Holdings Ltd

Australia

1.76

Ghana

Energy and Power

Ghana National Petroleum Corp

Ghana

South Africa

Media and Entertainment

ICD

Utd Arab Em

Egypt

Healthcare

Triquera BV

Netherlands

17.83

Cadiz Holdings Ltd

South Africa

Financials

Stellar Capital Partners Ltd

South Africa

3.82

United National Breweries(SA)

South Africa

Consumer Staples

Diageo PLC

United Kingdom

Botswana

Materials

BCL Ltd

Botswana

DCD Protected Mobility

South Africa

Industrials

Paramount Group

South Africa

Undisclosed Fruit Pkg Plant

South Africa

Materials

SA San Miguel AGICI yF

Argentina

Pacmar (Pty) Ltd

South Africa

Consumer Staples

Rhodes Food Group Pty Ltd

South Africa

14.13

Nigeria

Consumer Staples

PZ Cussons PLC

United Kingdom

30.78

Nigerian Telecom PLC Undisclosed Fashion Accessory Ghana National Gas Co Ltd One&Only Cape Town Minapharm Pharmaceuticals SAE

Tati Nickel Mining Co (Pty)

600 2000 500

SOURCE: STATE DEPARTMENT OF AGRICULTURE. EMAIL MARKETINFO@KILIMO.GO.KE

Unit Trusts EFFECTIVE DATE: 15TH APR 2015 CURRENCY DAILY YIELD EFFECTIVE ANNUAL RATE MONEY MARKET FUND SH 7.38% 7.64% OLD MUTUAL SH 10.96% 11.58% BRITISH AMERICAN SH 9.00% 9.36% CBA SH 10.69% 11.28% UAP SH 10.30% 10.85% ICEA SH 10.66% 11.19% AMANA SH 9.73% 10.18% MADISON SH 10.90% 11.35% GENCAP HELA SH 11.00% 11.63% PAN AFRICA PESA+ CURRENCY BUY SELL FIXED INCOME FUND SH 144.6 110.59 GENCAP HAZINA USD NABO AFRICA BALANCED FUND SH 164.14 174.79 OLD MUTUAL / TOBOA SH 195.47 201.19 BRITISH AMERICAN SH 143.10 144.31 BA MANAGED RETIREMENT SH 124.66 124.66 AMANA SH 144.23 151.82 ICEA SH 133.17 128.51 GENCAP ENEZA SH 65.69 69.31 MADISON SH 10.84 11.39 UAP SH 10.52 10.85 PAN AFRICA CHAMA+ USD NABO AFRICA EQUITY FUND SH 413.43 442.97 OLD MUTUAL SH 161.49 170.91 OLD MUTUAL EAST AFRICA FUND SH 125.64 125.64 AMANA SH 214.31 221.12 BRITISH AMERICAN SH 170.14 170.14 CBA SH 152.52 160.55 ICEA SH 139.15 134.28 GENCAP HISA SH 52.29 55.51 MADISON SH 10.89 11.43 UAP USD NABO AFRICA BOND FUND SH 100.35 102.73 OLD MUTUAL BOND FUND SH 138.14 140.96 BRITISH AMERICAN SH 98.48 99.48 ICEA SH 10.82 10.82 UAP SH 10.22 10.54 PAN AFRICA PATA+ SHARIAH COMPLIANT SH 118.31 112.39 GENCAP IMAN

Nutricima Ltd

M&A Recent Deals Announced this Month in Africa Target Name

Target Nation

Target TF Macro Description

Acquiror Name

Acquiror Nation

Rank Value of Deal ($mil)

Zimpeto Square

Mozambique

Real Estate

Delta International

Bermuda

Uni-Metals East Africa Ltd

Tanzania

Materials

Manaksia Coated Metals

India

TTC Sales & Mktg (SA) (Pty)

South Africa

High Technology

Undisclosed Acquiror

Unknown

0.07

Al Tawfeek for Asts Egypt Leasing

Financials

Undisclosed Acquiror

Unknown

2.62

Capespan Group Ltd

South Africa

Retail

Zeder Investments Ltd

South Africa

48.92

One&Only Cape Town

South Africa

Media and Entertainment

ICD

Utd Arab Em

ARX Invest Partners Pty Ltd

South Africa

Financials

Efﬁcient Group Ltd

South Africa

10.3

Cadiz Holdings Ltd

South Africa

Financials

Stellar Capital Partners Ltd

South Africa

3.82

Dimopoint Proprietary Ltd

South Africa

Financials

Imbali Props 21 Pty Ltd

South Africa

95.25

Ethiopian Crown Cork & Can

Ethiopia

Materials

Fairfax Africa Fund LLC

United States

10.26

Grand Invest for Constituting

Egypt

Financials

Undisclosed Acquiror

Unknown

0.23

Pinnacle Hldg LtdPort

South Africa

Real Estate

Orange River Trading SA CC

South Africa

0.9

AGM Mining Co Ltd

Ghana

Materials

Investor Group

South Korea

United National Breweries(SA)

South Africa

Consumer Staples

Diageo PLC

United Kingdom

Pinnacle Hldg LtdMidrand Ppty

South Africa

Real Estate

Orange River Trading SA CC

South Africa

6.18

Pinnacle HldgBloemfontein

South Africa

Real Estate

Orange River Trading SA CC

South Africa

1.14

DCD Protected Mobility

South Africa

Industrials

Paramount Group

South Africa

Undisclosed Fruit Pkg Plant

South Africa

Materials

SA San Miguel AGICI yF

Argentina

Friday April 17, 2015 | BUSINESS DAILY

MARKET DATA African Indices

Nairobi Stocks

NAME

NSE 20 Share Index

5,078.74 -0.92%

Nairobi

JSE ALL SHARE INDEX

5,500.00

ALSIUG

5,400.00

ZSE INDUSTRIAL

5,300.00

CFG INDEX

5,200.00

MALAWI ALL SHR

5,100.00

DSE ALL SHR IDX

5,000.00

NSE ALL SHARE/D

4,900.00

EGX 30 IDX/D

4,800.00

TUN MAIN INDEX March ‘15

RSE ALLSHARE IND

171.57 0.29%

Nairobi

182.00 177.00 172.00 167.00 162.00 157.00 152.00 147.00 July ‘14

March ‘15

FTSE Pan African Index

1,238.45 0.09%

Nairobi 1500.00 1450.00 1400.00 1350.00 1300.00 1250.00 1200.00 1150.00 July ‘14

March ‘15

Active ActiveCounters Counters Last fri

Prev ffri

Price

KCB Safaricom Equity Home Africa Barclays

65.00

Total Shares

Change

65.00

Traded

0.00%

4,180,700

16.75

16.30

2.76%

2,938,700

46.00

0.00%

2,317,600

3.00

0.00%

1,217,800

15.80

15.85

-0.32%

1,133,600

Gainers Last fri Counter

Standard Grp Sameer

Price

37.25 5.55

Prev ffri

Net

Price

Change

35.00 5.30

% Chng

2.25

6.43%

0.25

4.72%

Express (K)

5.80

5.55

0.25

4.50%

FTG

9.50

9.10

0.40

4.40%

46.50

44.75

1.75

3.91%

Unga

Losers Counter

Last fri Price

BAT Kenya

676.00

5,078.74

-47.28

NET.CHNG

PCT.CHNG -0.92%

OPEN

HIGH

5,078.74

LOW

5,078.74

5,126.02

ZAMBIA

6,106.71

3.95

0.06%

6,106.71

6,102.76

SOUTH AFRICA

54,111.12

390.55

0.73%

53,904.53

54,111.12

53,903.40

53,720.57

UGANDA

2,061.57

-17.73

-0.85%

2,079.30

ZIMBABWE

156.57

-0.35

-0.22%

156.92

MOROCCO

21,109.45

36.73

0.17%

21,115.21

21,109.45

21,072.72

MALAWI

15,597.69

81.03

0.52%

15,516.66

TANZANIA

2,739.56

10.99

0.40%

2,728.57

NIGERIA

34,866.68

-99.20

-0.28%

34,965.88

35,194.66

34,866.68

34,965.88

EGYPT

8,886.84

-9.84

-0.11%

8,897.38

8,843.29

8,896.68

TUNISIA

5,413.75

-22.45

-0.41%

5,423.96

5,430.33

5,395.30

5,436.20

RWANDA

137.14

0.00

0.00%

137.14

Daily Share Report

All Share Index (NASI)

Counter

LAST

KENYA

LUSE ALL SHARE INDEX

5,600.00

July ‘14

LOCATION

NSE 20 - SHR IDX

Prev fri price

Net Change

720.00 -44.00

% Chng

-6.11%

7.10

7.45

-0.35

-4.70%

Sasini

16.05

16.70

-0.65

-3.89%

Scangroup

43.50

44.75

-1.25

-2.79%

Umeme

17.45

17.95

-0.50

-2.79%

MARKET UPDATES

52 WK HIGH

52 WK LOW

AGRICULTURAL 100.00 26.00 EAAGADS 346.00 110.00 KAKUZI 180.00 120.00 KAPCHORUA TEA 1185.00 620.00 LIMURU TEA 27.50 27.50 REA VIPINGO 18.50 11.50 SASINI 319.00 240.00 WILLIAMSON TEA AUTOMOBILES & ACCESSORIES 62.00 31.00 CAR & GEN 13.60 8.00 MARSHALLS 9.40 5.20 SAMEER BANKING 18.45 15.05 BARCLAYS 155.00 104.00 CFC STANBIC 280.00 216.00 DTBK 63.00 31.00 EQUITY 55.00 33.25 HF 147.00 120.00 I&M HOLDINGS 65.50 42.25 KCB 34.00 22.25 NBK 85.00 55.00 NIC BANK 357.00 290.00 STAN. CHART. 25.00 17.10 CO-OP BANK COMMERCIAL 8.50 4.15 EXPRESS (K) 20.25 20.25 HUTCHINGS BIEMER 13.50 7.00 KQ 30.75 7.90 LONGHORN PUBLISHERS 325.00 225.00 NATION MEDIA 247.00 40.00 SCANGROUP 47.50 26.25 STANDARD GRP 49.50 32.00 TPS EA 15.60 8.00 UCHUMI CONSTRUCTION & ALLIED 95.00 72.00 ARM CEMENT LTD 206.00 135.00 BAMBURI 165.00 83.00 CROWN BERGER 17.00 13.50 EA CABLES 110.00 51.00 EAPC ENERGY & PETROLEUM 13.15 8.70 KENGEN 10.50 7.90 KENOLKOBIL 17.15 17.15 KENYA POWER 32.00 22.00 TOTAL 23.00 13.00 UMEME INSURANCE 40.00 16.40 BRITISH AMERICAN 12.40 7.50 CIC INSURANCE 599.00 301.00 JUBILEE 21.00 16.00 KENYA RE 26.00 15.10 LIBERTY KENYA 142.00 101.00 PAN AFRICA INVESTMENT 84.50 35.00 CENTUM INVEST. 10.85 2.50 OLYMPIA 30.00 16.00 TRANSCENTURY INVESTMENT SERVICES 15.00 NAIROBI SECURITIES EXCHG 28.00 MANUFACTURING & ALLIED 11.10 11.10 A. BAUMANN 165.00 123.00 BOC GASES 1050.00 521.00 BAT KENYA 37.00 19.60 CARBACID 355.00 250.00 EABL 5.35 2.65 EVEREADY EA 192.00 4.40 K. ORCHARDS 3.85 1.35 MUMIAS 56.50 22.00 UNGA TELECOMMUNICATION & TECHNOLOGY SAFARICOM 17.50 11.75 GROWTH AND ENTERPRISE MARKET SEGMENT ATLAS DEVELOPMENT 13.75 11.00 8.00 FLAME TREE GROUP HOLDINGS 14.00 5.80 2.90 HOME AFRICA 1500.00 KURWITU VENTURES LTD 1500.00

YTD %

VWA LAST PRICE

VWA PREV PRICE

DAILY PRICE CHANGE

DAILY TRADED SHARES

SHARES ISSUED

EPS LATEST 12MNTH

P/E TRAILING

PBV TRAILING

DPS LATEST 12MNTH

TOTAL DIVIDEND YIELD

-14.88% 42.22% -5.11% 23.48% 0.00% 29.96% 12.10%

35.75 256.00 130.00 952.00 27.50 16.05 278.00

35.75 256.00 130.00 952.00 27.50 16.70 278.00

0.00% 0.00% 0.00% 0.00% 0.00% -3.89% 0.00%

13,000 200

32,157,000 19,599,999 3,912,000 1,200,000 60,000,000 228,055,500 8,756,320

1,149,612,750.0 5,017,599,744.0 508,560,000.0 1,142,400,000.0 1,650,000,000.0 3,660,290,775.0 2,434,256,960.0

-1.30 8.17 32.21 -0.28 5.85 0.54 81.36

-27.50 31.33 4.04 -3400.00 4.70 29.72 3.42

2.86 1.73 0.37 4.64 0.74 0.58 0.38

0.00 3.75 5.00 1.00 0.00 0.25 7.00

0.00% 1.46% 3.85% 0.11% 0.00% 1.56% 2.52%

-15.74% 21.43% -11.67%

45.50 11.90 5.55

45.50 11.90 5.30

0.00% 0.00% 4.72%

6,400 9,800

40,103,308 14,393,106 278,342,393

1,824,700,514.0 171,277,961.4 1,544,800,281.2

6.57 -11.90 -0.24

6.93 -1.00 -23.13

0.87 0.44 0.66

0.60 0.00 0.00

1.32% 0.00% 0.00%

-5.09% 0.81% -2.13% -8.00% -24.59% -1.63% 14.04% -7.07% -0.87% 3.58% 7.50%

15.80 124.00 230.00 46.00 34.50 120.00 65.00 22.75 57.00 345.00 21.25

15.85 125.00 230.00 46.00 34.50 121.00 65.00 23.00 57.00 347.00 21.50

-0.32% -0.80% 0.00% 0.00% 0.00% -0.83% 0.00% -1.09% 0.00% -0.58% -1.16%

1,133,600 7,900 13,500 2,317,600 34,900 24,000 4,180,700 16,100 11,200 1,700 232,600

5,431,536,000 395,321,638 242,110,105 3,702,777,020 352,416,667 392,362,039 2,984,227,692 280,000,000 639,945,603 309,159,514 4,889,316,295

85,818,268,800.0 49,019,883,112.0 55,685,324,150.0 170,327,742,920.0 12,158,375,011.5 47,083,444,680.0 193,974,799,980.0 6,370,000,000.0 36,476,899,371.0 106,660,032,330.0 103,897,971,268.8

1.54 14.38 21.92 4.55 4.21 13.56 5.63 3.11 7.07 33.21 1.64

10.26 8.62 10.49 10.11 8.19 8.85 11.55 7.32 8.06 10.39 12.96

2.65 2.12 2.42 3.30 1.33 2.15 3.03 0.52 1.76 2.95 2.42

1.00 6.15 2.40 1.80 1.50 2.90 2.00 0.00 1.00 17.00 0.50

6.33% 4.96% 1.04% 3.91% 4.35% 2.42% 3.08% 0.00% 1.75% 4.93% 2.35%

-10.48% 0.00% -14.37% -9.73% -10.65% -1.10% 0.72% -8.78% 3.48%

5.80 20.25 7.10 8.35 237.00 43.50 37.25 33.75 10.40

5.55 20.25 7.45 8.35 235.00 44.75 35.00 33.75 10.40

4.50% 0.00% -4.70% 0.00% 0.85% -2.79% 6.43% 0.00% 0.00%

1,400 196,700 14,500 1,100 8,600 200 5,100 11,000

35,403,790 360,000 1,496,469,035 243,750,000 188,542,286 378,865,102 81,731,808 182,174,108 364,959,616

205,341,982.0 7,290,000.0 10,624,930,148.5 2,035,312,500.0 44,684,521,782.0 16,480,631,937.0 3,044,509,848.0 6,148,376,145.0 3,795,580,006.4

0.01 -18.34 -2.25 1.62 13.10 2.70 2.57 3.45 1.45

580.00 -1.10 -3.16 5.15 18.09 16.11 14.49 9.78 7.17

1.03 3.40 1.13 5.46 2.01 1.68 0.56 0.94

0.00 0.00 0.00 2.00 10.00 0.40 0.50 1.35 0.30

0.00% 0.00% 0.00% 23.95% 4.22% 0.92% 1.34% 4.00% 2.88%

-11.05% 8.63% -4.50% -4.32% 2.59%

74.50 152.00 106.00 15.30 59.50

76.50 151.00 106.00 15.50 59.50

-2.61% 0.66% 0.00% -1.29% 0.00%

808,300 19,900 500 22,700 -

495,275,000 362,959,275 23,727,000 253,125,000 90,000,000

36,897,987,500.0 55,169,809,800.0 2,515,062,000.0 3,872,812,500.0 5,355,000,000.0

3.01 9.80 9.01 1.37 -4.30

24.75 15.51 11.76 11.17 -13.84

4.54 1.91 1.85 1.61 1.11

0.60 12.00 1.75 1.00 0.00

0.81% 7.89% 1.65% 6.54% 0.00%

-2.91% 2.30% 18.69% -2.08% -14.52%

10.00 8.90 17.15 23.75 17.45

10.00 8.90 17.15 23.50 17.95

0.00% 0.00% 0.00% 1.06% -2.79%

89,100 244,900 100 3,100

2,198,361,456 1,471,761,200 1,951,467,045 175,028,706 1,623,878,005

21,983,614,560.0 13,098,674,680.0 33,565,233,174.0 4,156,931,767.5 28,336,671,187.3

1.29 0.74 3.31 2.26 1.34

7.75 12.03 5.18 10.51 12.99

0.32 1.96 0.77 0.82 3.09

0.40 0.20 0.50 0.70 0.90

4.00% 2.25% 2.92% 2.95% 5.18%

-14.29% -5.21% 26.67% 6.16% 0.00% 5.83%

25.75 9.00 562.00 18.00 23.00 126.00

25.50 9.10 570.00 18.10 23.25 127.00

0.98% -1.10% -1.40% -0.55% -1.08% -0.79%

229,400 267,900 3,000 351,700 15,400 300

1,938,415,838 2,615,538,528 59,895,000 699,949,068 535,707,499 96,000,000

49,914,207,828.5 23,539,846,752.0 33,660,990,000.0 12,599,083,224.0 12,321,272,477.0 12,096,000,000.0

1.47 0.43 48.00 4.48 2.14 9.07

17.52 20.93 11.71 4.02 10.75 13.89

2.88 2.91 3.15 0.70 2.33 3.62

0.30 0.10 8.50 0.70 0.50 0.00

1.17% 1.11% 1.51% 3.89% 2.17% 0.00%

-2.46% 10.58% -12.40%

59.50 5.60 17.00

59.50 5.75 16.95

0.00% -2.61% 0.29%

90,300 38,300 10,900

665,441,775 40,000,000 280,284,476

39,593,785,612.5 224,000,000.0 4,764,836,092.0

4.54 0.38 1.06

13.11 14.74 16.04

1.95 0.28 0.90

0.00 0.00 0.40

0.00% 0.00% 2.35%

19.65

19.60

0.26%

178,400

194,625,000

3,824,381,250.0

2.13

9.23

5.24

0.38

1.93%

0.00% 8.00% -20.70% -4.60% 9.42% 4.05% 0.00% 10.26% 12.58%

11.10 134.00 676.00 20.50 335.00 3.95 110.00 2.20 46.50

11.10 135.00 720.00 20.75 337.00 3.85 110.00 2.15 44.75

0.00% -0.74% -6.11% -1.20% -0.59% 2.60% 0.00% 2.33% 3.91%

100 1,600 3,000 74,100 58,500 602,500 100

3,840,066 19,525,446 100,000,000 254,851,988 790,774,356 210,000,000 12,868,124 1,530,000,000 75,708,873

42,624,732.6 2,616,409,764.0 67,600,000,000.0 5,224,465,754.0 264,909,409,260.0 829,500,000.0 1,415,493,640.0 3,366,000,000.0 3,520,462,594.5

-2.02 11.76 42.55 1.93 8.21 -0.85 0.15 -1.77 3.65

-5.50 11.39 15.89 10.62 40.80 -4.65 733.33 -1.24 12.74

1.80 8.93 3.16 9.70 2.56 578.95 0.32 0.75

0.00 5.20 42.50 0.30 5.50 0.00 0.00 0.00 0.75

0.00% 3.88% 6.29% 1.46% 1.64% 0.00% 0.00% 0.00% 1.61%

16.01%

16.75

16.30

2.76%

2,938,700

40,065,428,000

671,095,919,000.0

0.57

29.39

8.38

0.47

2.81%

-26.83% -

11.00 9.50 3.00 1500.00

11.00 9.10 3.00 1500.00

0.00% 4.40% 0.00% 0.00%

5,500 1,217,800 -

433,063,193 161,866,804 405,255,320 102,272

4,763,695,123.0 1,537,734,638.0 1,215,765,960.0 153,408,000.0

-0.04 0.92 0.05 -62.40

-275.00 10.33 60.00 -24.04

0.00 0.92 0.00 0.00

0.00% 9.69% 0.00% 0.00%

MKT CAP. KSHS

TO RECEIVE NATIONMOBILE ALERTS ON YOUR CELLPHONE, SMS THE STOCK YOU WANT, E.G. STOCKS KENGEN, TO 20667. 6667. EACH EACHALERT ALERTCOSTS COSTSSH5 SH5ABOVE ABOVENORMAL NORMALRATES. RATES.

BUSINESS DAILY | Friday April 17, 2015

MARKET DATA Equities & Bonds Kenya Treasury and Infrastructure Bonds

Share Price Performance Scorecard SCORECARD AS AT 16TH APRIL 2015 NAME A BAUMANN ATLAS DEVPNT & SPPRT SERV ATHI RIVER MINING BAMBURI BARCLAYS KEN BAT KENYA BOC KENYA BRITISH AMERICAN CAR & GENERAL CARBACID INV CENTUM INV CFC STANBIC BANK CIC INSURANCE CO-OP BANK CROWN BERGER DIAMOND KEN EA CABLES EA PORT CEM EAAGADS EA AFR BREW EQUITY BANK EVEREADY EA EXPRESS KEN FLAME TREE HLDNGS G WILLIAMSON HUTCHINGS BIEMER HOME AFRICA LIMITED HOUSING FIN I&M HOLDING JUBILEE HLDS KAKUZI KAPCHORUA KEN ORCHARDS KENGEN KENYA AIRWAYS KENYA COM BK KENOLKOBIL KENYA POWER KENYA RE KURWITU LIBERTY HOLDINGS LIMURU TEA LONGHORN MARSHALL MUMIAS SUGAR NAIROBI SECURITIES NATION MEDIA NATL BANK KEN NIC BANK OLYMPIA CAPITAL PAN AFR INS REA VIPINGO SAFARICOM SAMEER AFRICA SASINI SCANGROUP STANDARD GRP STD CHART KEN TOTAL KENYA TPS (EA) TRANSCENTURY UCHUMI SUPER UNGA GROUP

PREVIOUS 11.10 11.00 76.50 151.00 15.85 720.00 135.00 25.50 45.50 20.75 59.50 125.00 9.10 21.50 106.00 230.00 15.50 59.50 35.75 337.00 46.00 3.85 5.55 9.10 278.00 20.25 3.00 34.50 121.00 570.00 256.00 130.00 110.00 10.00 7.45 65.00 8.90 17.15 18.10 1500.00 23.25 952.00 8.35 11.90 2.15 19.60 235.00 23.00 57.00 5.75 127.00 27.50 16.30 5.30 16.70 44.75 35.00 347.00 23.50 33.75 16.95 10.40 44.75

CLOSE 11.10 11.00 74.50 152.00 15.80 676.00 134.00 25.75 45.50 20.50 59.50 124.00 9.00 21.25 106.00 230.00 15.30 59.50 35.75 335.00 46.00 3.95 5.80 9.50 278.00 20.25 3.00 34.50 120.00 562.00 256.00 130.00 110.00 10.00 7.10 65.00 8.90 17.15 18.00 1500.00 23.00 952.00 8.35 11.90 2.20 19.65 237.00 22.75 57.00 5.60 126.00 27.50 16.75 5.55 16.05 43.50 37.25 345.00 23.75 33.75 17.00 10.40 46.50

% 1D 0.00 0.00 -2.61 0.66 -0.32 -6.11 -0.74 0.98 0.00 -1.20 0.00 -0.80 -1.10 -1.16 0.00 0.00 -1.29 0.00 0.00 -0.59 0.00 2.60 4.50 4.40 0.00 0.00 0.00 0.00 -0.83 -1.40 0.00 0.00 0.00 0.00 -4.70 0.00 0.00 0.00 -0.55 0.00 -1.08 0.00 0.00 0.00 2.33 0.26 0.85 -1.09 0.00 -2.61 -0.79 0.00 2.76 4.72 -3.89 -2.79 6.43 -0.58 1.06 0.00 0.29 0.00 3.91

% 5D 0.00 -3.51 -5.70 -1.94 -3.07 -6.11 -0.74 1.98 -8.54 -1.20 0.00 -0.80 -4.26 1.19 -9.40 -0.43 -2.55 0.00 2.88 3.72 -3.16 8.22 2.65 1.60 -0.71 0.00 -14.29 -4.17 -5.51 8.08 -8.57 0.00 -1.79 -2.91 -7.79 5.69 0.00 -0.87 -3.49 0.00 -6.12 0.21 0.60 0.00 -4.35 0.00 0.42 -1.09 0.88 0.90 4.13 0.00 2.45 -0.89 -2.73 -0.57 5.67 1.77 -4.04 0.00 -3.68 0.48 9.41

% 1M 0.00 -3.93 -13.87 -5.59 -7.33 -18.36 -1.47 -4.63 -14.15 -5.75 0.85 -0.80 -4.26 4.94 -19.08 -4.56 -1.61 -0.83 -4.03 9.84 -10.68 -3.66 -3.33 5.56 -2.11 0.00 -7.69 -11.54 -4.00 2.37 -11.42 -7.80 -4.35 -9.09 -24.47 8.33 -11.00 -5.77 -2.96 0.00 -7.07 -15.30 -7.73 -0.42 -21.43 1.29 -4.44 -7.14 -8.06 -5.08 -5.26 0.00 7.03 -15.27 5.94 -8.90 -6.88 -2.54 -14.41 0.75 -5.56 0.48 -0.53

% 3M 0.00 -8.33 -7.45 0.66 -3.66 -24.89 -2.90 -13.45 -9.00 -10.87 -9.16 -0.80 -9.09 11.26 -4.50 -2.95 -3.16 -1.65 -14.88 9.84 -10.68 3.95 -5.69 17.28 -1.07 0.00 -25.00 -25.81 -3.23 22.17 28.00 -13.33 0.00 1.01 -25.65 10.17 -5.32 13.20 0.28 0.00 -1.08 12.66 -16.08 5.31 -31.25 -4.15 -14.75 -15.74 -10.94 -15.79 7.69 0.00 12.79 -15.27 28.40 -4.40 4.93 2.07 -12.84 -13.46 -10.53 -11.11 14.11

% 6M 0.00 -15.82 -3.18 -6.51 -32.33 -14.65 -10.43 -11.65 -21.90 0.00 -0.80 -15.09 -1.16 -10.92 -11.54 -8.66 -15.60 -17.34 21.82 -8.91 2.60 -22.67 -9.15 0.00 0.00 -24.59 -11.11 33.18 21.90 -21.21 -21.43 -16.32 -19.77 12.07 -8.25 13.95 0.56 2.22 8.39 -62.05 7.69 15.79 -9.66 -23.55 -17.27 -14.93 64.71 0.80 0.00 34.00 -14.62 13.83 -5.95 -3.25 1.77 -14.41 -6.90 0.00 5.05 -0.53

% 1Y 0.00 -12.35 -17.84 -2.77 16.55 -5.63 41.10 42.19 -39.71 55.56 7.83 0.00 3.66 23.26 0.00 -0.97 -40.20 27.68 18.79 42.64 23.44 18.37 2.21 0.00 0.00 -5.48 0.00 84.26 113.33 -8.45 1900.00 -14.53 -43.87 38.30 -5.82 15.10 -7.22 21.05 53.55 -37.92 19.00 -31.25 -23.05 -17.27 -6.56 19.15 0.00 0.00 26.89 -18.98 -5.59 -5.43 30.70 8.49 -2.06 -20.59 0.00 -28.52 95.79

Corporate Bonds APRIL 16TH, 2015

BONDS LISTED AT THE NAIROBI SECURITIES EXCHANGE ISSUE MATURITY ISSUED VALUE COUPON DATE DATE IN MILLIONS (%)

ISSUE NO. CORPORATE BONDS CENTUM BOND SENIOR UNSECURED FIXED RATE AND EQUITY LINKED NOTES 26-SEP-12 18-SEP-17 CTNB.BD.18.09.17/13.50 26-SEP-12 18-SEP-17 CTNB.BD.18.09.17/12.75 CONSOLIDATED BANK OF KENYA LTD MEDIUM TERM NOTE PROGRAMME 30-JUL-12 24-JUL-19 CON.BD-FXD(SN)/2012/7YR 30-JUL-12 22-JUL-19 CON.BD-FXD(SBN)/2012/7YR 30-JUL-12 22-JUL-19 CON.BD-FR(SN)/2012/7YR SHELTER AFRIQUE MEDIUM TERM NOTES 17-DEC-12 14-DEC-15 FXD 2/2012/3YR 2ND TRANCHE 30-SEP-13 24-SEP-18 FXD 1/13/05YR 30-SEP-13 24-SEP-18 FR 1/13/05YR BARCLAYS BANK MEDIUM TERM FLOATING RATE NOTES 14-JUL-08 14-JUL-15 FXD (MTN)/2008/7YR 14-JUL-08 14-JUL-15 FR (MTN)/2008/7YR MRM 27-OCT-08 17-OCT-16 FR (MRM) 2008/8YR 27-OCT-08 17-OCT-16 FXD (MRM) 2008/8YR CFC STANBIC BANK SENIOR & SUBORDINATED BOND ISSUE 7-JUL-09 7-JUL-16 FR (CFC STANBIC) 2009/7YR 7-JUL-09 7-JUL-16 FXD (CFC STANBIC) 2009/7YR KENGEN PUBLIC INFRASTRUCTURE BOND OFFER 2019 2-NOV-09 31-OCT-19 FXIB 1/2009/10YR SAFARICOM LTD DOMESTIC MEDIUM TERM NOTE 20-DEC-10 20-DEC-15 FR2 (SAFARICOM LTD) 2009/5YR 20-DEC-10 20-DEC-15 FXD2 (SAFARICOM LTD) 2009/5YR HOUSING FINANCE MEDIUM TERM NOTE 22-OCT-12 14-OCT-19 FXD (HFCK) 02/2012/7YR 2ND TRANCHE 26-OCT-10 2-OCT-17 FR (HFCK) 2010/7YR 26-OCT-10 2-OCT-17 FXD (HFCK) 2010/7YR I&M MEDIUM TERM NOTE 13-DEC-13 8-MAR-19 FXD I&M-01/13/5.25 13-DEC-13 8-MAR-19 FRN I&M-01/13/5.25 BRITAM MEDIUM TERM NOTE 22-JUL-14 15-JUL-19 BRTB.BD.22/07/19-0037-13 UAP HOLDINGS MEDIUM TERM NOTE 28-JUL-14 22-JUL-19 UAP.BD.22.07.2019 NIC MEDIUM TERM NOTE 8-SEP-14 9-SEP-19 NIC.BD.09/09/19-0039-12.5 CIC INSURANCE GROUP LTDMEDIUM TERM NOTE 8-OCT-14 2-OCT-19 CIC.BD.22.07.2019 CFC STANBIC MULTICURRENCY MEDIUM TERM NOTE 15-DEC-14 8-DEC-21 CFCB.BD.08/12/21-0042-12.95 CBA FIXED MEDIUM TERM NOTE 22-DEC-14 14-DEC-20 CBAB.BD.14/12/20-0041-12.75 EABL FIXED MEDIUM TERM NOTE 23-MAR-15 19-MAR-18 EABB.BD.19/03/18-0043-12.25

BONDS LISTED AT THE NAIROBI SECURITIES EXCHANGE

APRIL 16TH, 2015

ISSUE

MATURITY

ISSUED VALUE COUPON

TRADED

TOTAL

DATE

IN MILLIONS

YIELD

PRICE

VALUE TRADED

(%)

(KSHS)

(%)

ISSUE NO.

(%)

TWO YEAR BONDS FXD 3/2013/2YR

26-AUG-13

24-AUG-15

17,927.40

12.9390

FXD 4/2013/2YR

24-DEC-13

21-DEC-15

25,251.00

11.5530

FXD 1/2014/2YR

24-MAR-14

21-MAR-16

20,000.00

10.8030

100.2806

101.1994 10.4000

100.3563

FXD 2/2014/2YR

26-MAY-14

23-MAY-16

20,130.15

10.7930

100.1729

FXD 3/2014/2YR

22-DEC-14

19-DEC-16

8,905.12

10.8900

100.2546

FXD 1/2015/2YR

23-JAN-15

20-FEB-17

23,592.55

11.4700

100.9404

FXD 1/2010/5YR

24-MAY-10

18-MAY-15

11,924.85

6.9510

98.9033

FXD 2/2010/5YR

30-NOV-10

23-NOV-15

14,973.10

6.6710

97.2455

277,500,000

FIVE YEAR BONDS

FXD 1/2011/5YR

31-JAN-11

25-JAN-16

22,083.10

7.6360

FXD 1/2012/5YR

28-MAY-12

22-MAY-17

31,079.55

11.8550

FXD 1/2013/5YR

29-APR-13

23-APR-18

20,240.75

12.8920

FXD 2/2013/5YR

1-JUL-13

25-JUN-18

26,340.05

11.3050

FXD 3/2013/5YR

25-NOV-13

19-NOV-18

14,937.80

11.9520

FXD 1/2014/ 5YR

28-APR-14

22-APR-19

25,540.95

10.8700

97.8865

FXD 2/2014/ 5YR

23-JUN-14

17-JUN-19

16,418.25

11.9340

101.3943

24-APR-06

13-APR-15

3,060.25

13.5000

102.2668

97.0450 10.9000

98.5816

104,900,000

103.9832 100.3825 11.1000

101.6262

200,000,000

NINE YEAR BONDS FXD 1/2006/9YR TEN YEAR BONDS FXD 1/2006/10YR

27-MAR-06

14-MAR-16

3,451.05

14.0000

102.1563

FXD 2/2006/10YR

29-MAY-06

16-MAY-16

5,028.10

14.0000

103.9277

FXD 1/2007/10YR

29-OCT-07

16-OCT-17

9,308.80

10.7500

99.3880

FXD 1/2008/10YR

29-OCT-07

16-OCT-17

2,992.75

10.7500

95.8019

FXD 2/2008/10YR

28-JUL-08

16-JUL-18

13,504.70

10.7500

97.5365

FXD 3/2008/10YR

29-SEP-08

28-SEP-18

4,151.60

10.7500

94.9482

FXD 1/2009/10YR

27-SEP-09

15-APR-19

4,966.85

10.7500

96.1897

FXD 1/2010/10YR

26-APR-10

13-APR-20

19,394.15

8.7900

86.1135

FXD 2/2010/10YR

1-NOV-10

19-OCT-20

18,849.90

9.3070

91.4516

FXD 1/2012/10YR

25-JUN-12

13-JUN-22

16,803.75

12.7050

102.1640

FXD 1/2013/10YR

1-JUL-13

19-JUN-23

12,643.05

12.3710

100.5707

FXD 1/2014/10YR

27-JAN-14

15-JAN-24

30,520.25

12.1800

99.3217

25-SEP-06

11-SEP-17

4,031.40

13.7500

97.6357

FXD1/2006/12YR

28-AUG-06

13-AUG-18

3,900.95

14.0000

105.2139

FXD1/2007/12YR

28-MAY-07

13-MAY-19

4,864.60

13.0000

104.9016

ELEVEN YEAR BONDS FXD1/2006/11YR TWELVE YEAR BONDS

FIFTEEN YEAR BONDS PREVIOUS PRICE (%)

TOTAL VALUE TRADED (KSHS)

FXD1/2007/15YR

26-MAR-07

7-MAR-22

3,654.60

14.5000

109.0397

FXD2/2007/15YR

25-JUN-07

6-JUN-22

7,236.95

13.5000

108.2496

FXD3/2007/15YR

26-NOV-07

7-NOV-22

17,568.00

12.5000

99.9310

2,917.10 1,250.80

13.5000 12.7500

105.2550 99.9620

FXD1/2008/15YR

31-MAR-08

13-MAR-23

7,830.90

12.5000

100.6070

1,480.60 196.50 1.00

13.2500 13.6000

99.1677 100.0000

FXD1/2009/15YR

26-OCT-09

7-OCT-24

9,420.45

12.5000

102.7808

FXD1/2010/15YR

29-MAR-10

10-MAR-25 20,823.73

10.2500

87.8904

FXD2/2010/15YR

25-APR-11

8-DEC-25

13,513.10

9.0000

81.9916

500.00 4,239.70 760.30

12.7500 12.7500

100.7057 100.0000

FXD1/2012/15YR

24-SEP-12

6-SEP-27

21,089.45

11.0000

89.7601

FXD1/2013/15YR

25-FEB-13

7-FEB-28

40,886.33

11.2500

90.8891

1,300 700

11.5000

99.4819 85.5534

FXD2/2013/15YR

29-APR-13

10-APR-28

17,385.85

12.0000

95.5914

20,360.95

13.7500

112.6478

TWENTY YEAR BOND

621.50 1,378.50

13.0000

100.0000 100.0000

FXD1/2008/20YR

30-JUN-08

5-JUN-28

97.91 2,402.09

100.0000 100.0000

FXD1/2011/20YR

30-MAY-11

5-MAY-31

9,365.80

10.0000

12.5000

FXD1/2012/20YR

26-NOV-12

1-NOV-32

43,082.72

12.0000

13.1000

93.1123

200,000,000

15,625

12.5000

100.0150

FXD1/2012/20YR

26-NOV-12

1-NOV-32

43,082.72

12.0000

13.1250

93.1123

100,000,000

8.0000

93.8370 103.0000

TWENTY FIVE YEAR BOND 28-JUN-10

28-MAY-35

20,192.50

11.2500

91.8177

13.0000

100.0000

THIRTY YEAR BOND 28-FEB-11

21-JAN-41

23,888.95

12.0000

91.0563

200.00 4,287.00 2,969.10 1,166.50 5,864.40

8.5000

FXD1/2010/25YR

100

SDB 1/2011/30YR

INFRASTRUCTURE BONDS

79.8372

3,429.00 226.00

12.8000

100.0000

IFB 1/2009/12YR

23-FEB-09

8-FEB-21

19,726.85

12.5000

105.1593

6,000.00

13.0000

96.8124

IFB 2/2009/12YR

7-DEC-09

22-NOV-21

18,897.65

12.0000

102.4081

2,000.00

13.0000

99.9807

IFB 1/2010/8YR

1-MAR-10

19-FEB-18

15,908.05

9.7500

98.2874

5,514.50

12.5000

100.0000

IFB 2/2010/9YR

31-AUG-10

19-SEP-19

32,871.55

6.0000

88.4106

IFB 1/2011/12YR

3-OCT-11

18-SEP-23

43,447.35

12.0000

102.3228

5,000.00

13.0000

100.0000

5,080.00

12.9500

100.0000

7,000.00

12.7500

100.0000

9,047.35

12.2500

100.2003

IFB 1/2013/12YR

30-SEP-13

15-SEP-25

38,841.68

11.0000

IFB 1/2014/12YR

27-OCT-14

12-OCT-26

35,060.55

11.0000

IFB 1/2015/12YR

30-MAR-15

15-MAR-27

25,695.35

11.0000

11.0997

99.0986

300,000,000

98.4647 10.6500

97.9033

66,300,000

Friday April 17, 2015 | BUSINESS DAILY

MARKET DATA Global Markets & Currencies Currencies

Europe’s Blue Chips

Kenya Shilling CURRENCY US DOLLAR STG POUND EURO SA RAND KES / USHS KES / TSHS KES / RWF KES / BIF AE DIRHAM CAN $ S FRANC JPY (100) SW KRONER NOR KRONER DAN KRONER IND RUPEE HONGKONG DOLLAR SINGAPORE DOLLAR SAUDI RIYAL CHINESE YUAN AUSTRALIAN $

BUY 93.42 138.47 99.72 7.74 32.06 20.14 7.31 16.65 25.43 75.96 96.80 78.23 10.73 11.98 13.36 1.50 12.05 68.90 24.91 15.07 72.27

SELL 93.58 138.75 99.92 7.76 32.22 20.28 7.41 16.89 25.48 76.13 97.00 78.39 10.75 12.00 13.38 1.50 12.07 69.02 24.95 15.10 72.42

MEAN 93.50 138.61 99.82 7.75 32.14 20.21 7.36 16.77 25.46 76.05 96.90 78.31 10.74 11.99 13.37 1.50 12.06 68.96 24.93 15.09 72.35

US Dollar BACKGROUND EURO JAPANESE YEN BRITISH POUND SWISS FRANC AUSTRALIAN DOLLAR CANADIAN DOLLAR SWEDISH KRONA NORWEGIAN KRONE BOSNIAN MARK DANISH KRONE RUSSIA ROUBLE TURKISH LIRA ICELAND KRONA INDIAN RUPEE POLISH ZLOTY CZECH KORUNA HUNGARIAN FORINT UKRAINE HRYVNIA ISRAEL SHEKEL ALBANIAN LEK BULGARIAN LEV SERBIAN DINAR CYPRUS POUND ESTONIAN KROON GEORGIAN LARI GIBRALTAR POUND CROATIAN KUNA KAZAKHSTAN TENGE LITHUANIA LITAS LATVIAN LATS MOLDOVAN LEU MACEDONIA DENAR MALTESE LIRA ROMANIAN LEU SLOVAK KORUNA SERBIAN DINAR ARMENIAN DRAM UAE DIRHAM ANGOLAN KWANZA BURUNDI FRANC BOTSWANA PULA CONGO FRANC CAPE VERDE ESCUDO CHINESE YUAN DIJIBOUTI FRANC ALGERIAN DINAR EGYPT POUND ETHIOPIAN BIRR GHANAIAN CEDI GAMBIAN DALASI ERITREA NAFKA GUINEA FRANC RWANDA FRANC KENYA SHILLING COMORO FRANC LIBERIAN DOLLAR LESOTHO LOTI LIBYAN DINAR MOROCCAN DIRHAM MALAGASY ARIARY MAURITANIAOUGUIYA MALAWI KWACHA MOZAMBIQUE METICAL NIGERIAN NAIRA SC RUPEE SUDANESE DINAR SUDAN POUND ST HELENA POUND SIERRALEONLEON SAO TOME DOBRA SOMALI SHILLING SWAZILAND LILAGENI THAI BAHT TUNISIAN DINAR TANZANIA SHILLING UGANDA SHILLING CFA FRANC CFA FRANC MAURITIUS RUPEE SOUTH AFRICA RAND ZIMBABWE DOLLAR

BID 1.07 119.04 1.49 0.96 0.78 1.23 8.66 7.81 1.84 6.97 50.07 2.69 135.83 62.30 3.76 25.63 280.89 20.80 3.93 130.50 1.83 59.99 0.40 11.70 2.24 1.48 7.06 185.79 2.85 0.51 18.02 57.17 3.41 4.12 21.55 111.78 471.40 3.67 108.80 1,537.70 0.10 909.00 101.34 6.19 177.00 98.39 7.63 20.37 3.82 42.60 15.00 7,000.01 685.00 93.30 456.00 84.00 12.02 1.37 9.97 3,080.03 311.00 437.00 35.20 199.00 13.17 200.02 2,025.50 1.53 4,340.00 22,175.00 704.00 12.02 32.40 1.97 1,890.00 2,997.00 612.07 612.07 36.00 12.04 378.00

ASK 1.07 119.09 1.49 0.96 0.78 1.23 8.66 7.81 1.85 6.97 50.08 2.69 136.13 62.31 3.76 25.68 281.29 21.10 3.94 130.89 1.83 60.19 0.40 11.71 2.26 1.48 7.07 186.09 2.85 0.51 18.38 57.75 3.42 4.13 21.60 112.18 474.40 3.67 109.30 1,587.70 0.10 939.00 102.84 6.20 178.00 98.88 7.63 20.57 3.86 43.60 15.50 7,500.01 696.00 93.40 457.00 85.00 12.07 1.37 9.99 3,147.00 319.00 450.00 35.80 199.10 13.83 201.02 2,035.60 1.54 4,440.00 23,549.00 711.00 12.07 32.42 1.97 1,900.00 3,007.00 617.07 617.07 36.30 12.05 381.00

FTSE 100

Based on one day performance in local currency % PERFORMANCE IN LOCAL CURRENCY COMPANY

COUNTRY

INDUSTRY

LAST

TELEFONICA S.A.

SPAIN

FIXED LINE TELECOMMUNICATIONS

13.72

0.2

ROYAL DUTCH SHELL A

UNITED KINGDOM

INTEGRATED OIL&GAS

2071.5

ASTRAZENECA

UNITED KINGDOM

PHARMACEUTICALS

4857.5

BG GRP

UNITED KINGDOM

INTEGRATED OIL&GAS

UBS GROUP

SWITZERLAND

CHG % CHG

1-WK

YTD

52-WK

1.44

4.06

15.1

19.66

1.27

2.22

-3.8

-7.13

57.5

1.2

2.2

6.6

30.47

1186

1.11

1.54

37.1

5.61

BANKS

19.12

0.2

1.06

0.42

11.9

10.01

BANCO BILBAO VIZCAYA ARGN SPAIN

BANKS

9.66

0.1

1.06

1.03

24.2

14.11

BP PLC

UNITED KINGDOM

INTEGRATED OIL&GAS

475.8

4.85

1.03

0.75

15.8

0.49

ING GROEP

NETHERLANDS

BANKS

14.15

0.14

0.04

30.6

46.76

SIEMENS

GERMANY

DIVERSIFIED INDUSTRIALS

103.45

0.95

0.93

...

10.3

9.02

BHP BILLITON

UNITED KINGDOM

GENERAL MINING

1472

12.5

0.86

0.58

-22.49

UNILEVER CVA

NETHERLANDS

FOOD PRODUCTS

40.91

0.33

0.8

0.01

25.3

33.44

UNILEVER

UNITED KINGDOM

FOOD PRODUCTS

2934

0.79

-0.03

11.6

11.47

ABB

SWITZERLAND

INDUSTRIAL MACHINERY

21.33

0.16

0.76

1.19

0.9

-4.39

DEUTSCHE BANK

GERMANY

BANKS

32.96

0.23

0.72

-0.39

31.9

5.79

RIO TINTO

UNITED KINGDOM

GENERAL MINING

2912

19.5

0.67

2.64

-2.9

-11.82

BANCO SANTANDER S.A.

SPAIN

BANKS

6.89

0.04

0.63

-1.37

0.5

3.5

BNP PARIBAS

FRANCE

BANKS

57.14

0.34

0.6

-0.19

6.7

NESTLE

SWITZERLAND

FOOD PRODUCTS

0.45

0.6

0.13

4.2

13.69

LLOYDS BANKING GROUP PLC

UNITED KINGDOM

BANKS

80.34

0.44

0.55

1.31

13.25

L’AIR LIQUIDE

FRANCE

COMMODITY CHEMICALS

122.55

0.65

0.53

-0.04

19.2

25.59

SCHNEIDER ELECTRIC SE

FRANCE

ELECTRICAL COMPONENTS&EQUIPMENT

72.48

0.37

0.51

-1.55

19.6

15.14

DAIMLER

GERMANY

AUTOMOBILES

87.35

0.42

0.48

-1.47

26.6

36.51

AXA

FRANCE

FULL LINE INSURANCE

24.27

0.11

0.46

-0.84

26.4

35.28

BRITISH AMERICAN TOBACCO

UNITED KINGDOM

TOBACCO

3691

13.5

0.37

-0.67

5.5

7.44

SANOFI SA

FRANCE

PHARMACEUTICALS

98.26

0.34

0.35

-0.5

29.9

32.75

CREDIT SUISSE GROUP AG

SWITZERLAND

BANKS

27.08

0.07

0.26

-0.15

-2.69

HSBC HLDGS

UNITED KINGDOM

BANKS

617.7

1.4

0.23

0.91

1.5

-0.03

FINANCIERE RICHEMONT

SWITZERLAND

CLOTHING&ACCESSORIES

83.75

0.1

0.12

-0.83

-5.7

-3.29

ZURICH INSURANCE GROUP

SWITZERLAND

FULL LINE INSURANCE

310

0.1

0.03

-1.46

-0.5

25.3

BASF

GERMANY

COMMODITY CHEMICALS

94.86

0.02

-1.92

35.7

23.23

SAP

GERMANY

SOFTWARE

68.76

-0.03

-0.04

-0.42

19.58

ALLIANZ SE

GERMANY

FULL LINE INSURANCE

168.15

-0.2

-0.12

-0.91

22.4

43.47

BT GROUP PLC

UNITED KINGDOM

FIXED LINE TELECOMMUNICATIONS

455.1

-0.9

-0.2

0.1

13.3

27.12

PRUDENTIAL

UNITED KINGDOM

LIFE INSURANCE

1677.5

-3.5

-0.21

-2.24

12.4

31.62

BAYER

GERMANY

SPECIALTY CHEMICALS

142.85

-0.35

-0.24

-2.29

26.4

56.1

ANHEUSER-BUSCH INBEV

BELGIUM

BREWERS

117.2

-0.3

-0.26

-0.72

24.9

51.07

STANDARD CHARTERED

UNITED KINGDOM

BANKS

1080

-3.5

-0.32

-2.61

12.1

-18.31

NOVARTIS AG

SWITZERLAND

PHARMACEUTICALS

100

-0.4

-1.38

8.3

35.96

ROCHE HOLDING PART. CERT.

SWITZERLAND

PHARMACEUTICALS

275.7

-1.3

-0.47

-0.93

2.1

8.84

RECKITT BENCKISER GRP

UNITED KINGDOM

NONDURABLE HOUSEHOLD PRODUCTS

6055

-36

-0.59

-1

16.2

24.79

Global Indices NAME

LOCATION

LAST

NET.CHNGPCT.CHNG

OPEN

HIGH

LOW

DJ INDU AVERAGE

NEW YORK

18,112.61

75.91

0.42%

18,045.71

18,160.52

18,045.71

18,036.70

FTSE EUROTOP 100

LONDON

3,284.66

-24.40

-0.74%

3,306.94

3,308.38

3,278.96

3,309.06

XETRA DAX PF/D

FRANKFURT

12,053.12

-178.22

-1.46%

12,224.76

12,227.59

12,029.35

12,231.34

CAC 40 INDEX/D

PARIS

5,224.71

-29.64

-0.56%

5,246.75

5,255.24

5,214.94

5,254.35

FTSE MIB/D

MILAN

23,752.77

-277.77

-1.16%

24,035.53

24,063.21

SMI PR/D

SWITZERLAND 9,404.65

-23.90

-0.25%

9,419.96

9,443.45

9,395.41

9,428.55

HANG SENG INDE/D

HONG KONG

27,739.71

120.89

0.44%

27,557.29

27,787.98

27,470.10

27,618.82

NIKKEI 225 INDEX

TOKYO

19,885.77

16.01

0.08%

19,862.48

19,894.35

19,742.12

19,869.76

ALL ORDINARIES

AUSTRALIA

5,917.62

40.29

0.69%

5,877.30

5,939.30

5,877.30

5,877.33

STRAITS TIMES/D

SINGAPORE

3,531.61

-8.34

-0.24%

3,549.85

3,523.71

3,539.95

SSE COMPOSITE/D

SHANGHAI

4,194.65

110.49

2.71%

4,055.92

4,195.31

4,031.24

4,084.16

S&P SENSEX/D

MUMBAI

28,666.04

-133.65

-0.46%

28,876.23

23,689.98 24,030.54

28,497.70 28,799.69

NAME AANGLO AMERICAN/D ASSOC.BR.FOODS/D ADMIRAL GROUP/D ABDN.ASSET.MAN/D AGGREKO/D ANTOFAGASTA/D ARM HOLDINGS/D ASHMORE/D AVIVA PLC/D ASTRAZENECA/D BAE SYSTEMS/D BARCLAYS/D BRIT AM TOBACC/D BG GROUP/D BR LAND CO/D BHP BILLITON/D BUNZL/D BP/D BURBERRY GRP/D BT GROUP/D CARNIVAL/D CENTRICA/D COMPASS GROUP/D CAPITA PLC/D CRODA INTL/D CRH/D DIAGEO/D MAN GROUP/D EVRAZ PLC/D EXPERIAN/D FRESNILLO/D G4S/D GKN/D GLENCORE/D GLAXOSMITHKLIN/D HAMMERSON/D HARGREAVES LS/D HSBC HOLDINGS/D ICAP PLC/D IAG/D INTERCONT HOTE/D IMI PLC/D IMPERIAL TOBAC/D INTERTEK GROUP/D ITV/D JOHNSON MATTHE/D KAZ MINERALS/D KINGFISHER/D LAND SECS GROU/D LEGAL & GENERA/D LLOYDS BNK GRP/D MEGGITT PLC/D MARKS & SP./D MORRISON SUPMK/D NATIONAL GRID/D NEXT/D OLD MUTUAL/D PETROFAC/D POLYMETAL INT/D PRUDENTIAL/D PEARSON/D RECKIT BNCSR G/D ROYAL BANK SCO/D ROYAL DTCH SHL/D REED ELSEVIER/D ROYAL DTCH SHL/D REXAM/D RIO TINTO/D ROLLS ROYCE PL/D RANDGOLD RES./D RSA INSRANCE G/D SABMILLER/D SAINSBURY(J)/D SCHRODERS/D SCHRODERS NV/D SAGE GROUP/D SHIRE/D STANDARD LIFE/D SMITHS GROUP/D SMITH&NEPHEW/D SERCO GROUP/D SSE PLC/D STANDRD CHART /D SEVERN TRENT/D TATE & LYLE/D TULLOW OIL/D TESCO/D UNILEVER/D UNITED UTIL GR/D VEDANTA RES/D VODAFONE GROUP/D WEIR GROUP/D WOLSELEY/D WPP PLC/D WHITBREAD/D KENYA AIRWAYS/D

LAST 1041.50 2969.00 1602.00 492.30 1599.00 748.00 1150.82 315.30 552.08 4876.50 513.67 258.50 3701.00 1190.50 849.13 1482.63 1857.72 476.95 1815.00 453.03 3205.00 259.10 1182.00 1127.00 2878.00 1896.00 1918.50 209.30 206.50 1182.82 756.69 301.55 372.10 297.50 1588.88 678.71 1224.00 608.01 550.00 568.00 2735.00 1278.00 3257.00 2654.61 264.60 3456.00 240.80 362.50 1273.00 281.20 79.98 550.50 569.50 200.50 908.90 7325.00 240.60 1028.00 575.50 1669.50 1378.00 5968.52 356.10 2096.50 1135.00 2131.50 583.00 2887.00 972.35 5115.00 435.60 3666.00 277.67 3341.00 2554.90 482.00 5510.00 468.80 1142.00 1151.32 146.40 1555.71 1069.00 2143.00 652.50 404.70 244.00 3053.33 973.00 582.50 228.63 1912.00 4078.00 1577.00 5250.00 7.30

CLOSE 1055.00 2955.00 1604.00 492.50 1590.00 751.00 1154.00 318.40 559.50 4857.50 532.50 259.65 3691.00 1186.00 863.50 1472.00 1860.00 475.80 1829.00 455.10 3259.00 262.30 1196.00 1152.00 2900.00 1857.00 1967.00 211.60 207.40 1187.00 738.00 304.90 364.10 298.90 1613.50 687.00 1242.00 617.70 550.00 583.50 2755.00 1276.00 3283.00 2664.00 267.30 3506.00 239.50 363.20 1291.00 282.30 80.34 564.00 570.50 203.60 898.60 7285.00 236.10 1065.00 578.50 1677.50 1427.00 6055.00 355.70 2071.50 1150.00 2122.00 590.00 2912.00 986.50 4985.00 434.40 3585.00 284.70 3363.00 2568.00 483.50 5515.00 473.40 1141.00 1172.00 146.00 1557.00 1080.00 2142.00 654.50 400.80 246.90 2934.00 974.50 563.00 227.90 1905.00 4094.00 1586.00 5310.00 7.45

NET.CHNG -13.50 14.00 -2.00 -0.20 9.00 -3.00 -4.00 -3.10 -7.00 19.00 -19.00 -1.15 9.00 4.50 -14.50 11.00 -2.00 1.15 -14.00 -2.15 -54.00 -3.30 -14.00 -25.00 -22.00 39.00 -49.00 -2.30 -0.90 -3.00 19.00 -3.30 8.00 -1.40 -24.50 -8.50 -18.00 -9.70 0.00 -15.50 -20.00 2.00 -26.00 -9.00 -2.70 -50.00 1.30 -0.70 -18.00 -1.10 -0.36 -13.50 -1.00 -3.10 10.30 40.00 4.50 -37.00 -3.00 -8.00 -49.00 -86.00 0.40 25.00 -15.00 9.50 -7.00 -25.00 -13.50 130.00 1.20 81.00 -7.00 -22.00 -15.00 -1.50 -5.00 -4.60 1.00 -21.00 0.40 -2.00 -11.00 1.00 -2.00 3.90 -2.90 119.00 -1.50 19.00 0.70 6.00 -16.00 -9.00 -60.00 -0.15

PCT.CHNG -1.28% 0.47% -0.12% -0.04% 0.57% -0.40% -0.35% -0.97% -1.25% 0.39% -3.57% -0.44% 0.24% 0.38% -1.68% 0.75% -0.11% 0.24% -0.77% -0.47% -1.66% -1.26% -1.17% -2.17% -0.76% 2.10% -2.49% -1.09% -0.43% -0.25% 2.57% -1.08% 2.20% -0.47% -1.52% -1.24% -1.45% -1.57% 0.00% -2.66% -0.73% 0.16% -0.79% -0.34% -1.01% -1.43% 0.54% -0.19% -1.39% -0.39% -0.45% -2.39% -0.18% -1.52% 1.15% 0.55% 1.91% -3.47% -0.52% -0.48% -3.43% -1.42% 0.11% 1.21% -1.30% 0.45% -1.19% -0.86% -1.37% 2.61% 0.28% 2.26% -2.46% -0.65% -0.58% -0.31% -0.09% -0.97% 0.09% -1.79% 0.27% -0.13% -1.02% 0.05% -0.31% 0.97% -1.17% 4.06% -0.15% 3.37% 0.31% 0.31% -0.39% -0.57% -1.13% -2.01%

BUSINESS DAILY | Friday April 17, 2015

The

OBITUARY Naku≥u hotelie≥ takes ﬁnal bow Page 29

GOLF We must nu≥tu≥e young golfe≥s Page 31

Featu≥es | Viewpoints | P≥oﬁles | Analysis

In the Headlines

Date with the anti-g≥aft cza≥s fo≥ces Ruto’s chief of staﬀ into the limelight PROBE Corruption claims shine spotlight on Kittany, the IT expert who

prefers to wield quiet authority away from the glare of media cameras BY EVELYN SITUMA

ad she stayed on as a lecturer at Strathmore University, Marianne Kitany would have struggled to capture the kind of media attention that she has received in recent weeks. Even after two years as the chief of staff at Deputy President William Ruto’s office, Ms Kitany is still intimidated by the cameras and given a chance, she would avoid the incessant questions and nagging by journalists. On Monday this week, the Alliance Girls alumnus walked into Integrity Centre in Nairobi for an appointment with the Ethics and Anti-Corruption Commission (EACC) officers over allegations that she diverted Sh200 million allocated to a department to fund a campaign to impeach Planning and Devolution secretary Anne Waiguru. After more than seven hours, Ms Kitany, in a flowery dress, walked out escorted by an aide who was cuddling some files. She waved at the waiting battery of reporters but declined to answer questions. That was characteristic of Ms Kitany, who despite the senior position that she holds would rather stay out of the media limelight. A rural girl who attended Kapchemosin Primary School in Kapsabet, she was always top of her class. She has climbed the ladder from a bills clerk at Kenya Commercial Bank in 1994 to managing the Deputy President’s schedules and his staff. Prior to her appointment to the current position, Ms Kitany, a management and technology professional, was the ICT manager at Kenya Railways Corporation where she cultivated a good working relationship with her then boss, Nduva Muli who later became Transport PS. Like Ms Kitany, Mr Muli has also been suspended over corruption claims. Pundits say that the movement of the two to public office shaped their later destiny. They each got a chance to work with the two Jubilee Coalition principals in the run-up to the 2013 General Election.

Mr Muli was brought in to help draft a chapter on the Jubilee manifesto on transport. He would later be given the privilege to implement the vision by being appointed the Transport PS. For her part, Ms Kitany proved herself to be a valuable asset based on her work during the formation of the coalition. Before then, Ms Kitany was not known to the Deputy President. But her work impressed Mr Ruto who would later offer her the chief of staff position. The position gives her immense influence in the political arena and in government, which she has not been shy to wield. In 2013, she wrote a memo to AttorneyGeneral Githu Muigai seeking to draw his attention to what she referred to as “numerous anomalies” on the standard gauge railway tender. The letter was copied to Transport secretary Michael Kamau, Mr Muli, Public Procurement Oversight Authority director-general Maurice Juma and President Uhuru Kenyatta’s chief of staff. Her advice was that the President should not be made to preside over the launch of the project until the issues were addressed. By virtue of her position, she has also been involved in coordinating the implementation of the Presidential Task Force on Parastatal Reforms compiled by the Abdikadir Mohamed-led team. The Global Executive Master of Business Administration graduate of the Unit-

ed States International University is variously described by people she has worked with as assertive and an achiever. She also holds a Master of Science degree in Information Systems and Communication Technology from the University of Nairobi and a Bachelor’s of Education degree in Mathematics and Computer Science from Kenyatta University. She put her education training skills in practice during a stint at Strathmore University as a part-time lecturer. A profile on the Office of the Deputy President’s website credits her leadership, management and financial skills to training by the eCornell University in New York. Beneath the pretty face and sweet smile lies a steely spirit that has seen her master the laws of power in a male-dominated field. According to her CV, she began her work life in 1994 as a bills clerk at KCB, before taking up a job as a tutor at the Kenya Polytechnic (now Technical University of Kenya) where she taught business and computer studies. She later worked as a help desk administrator and software answers support specialist at GlaxoSmithKline, before moving to Deacons Kenya Ltd as a systems analyst. At the same time, she was the information systems manager at the Energy Regulatory Commission. She then moved to the law firm Hamilton Harrison & Mathews Advocates as the ICT manager until 2007. It was from there that she moved to the Kenya Railways Corporation as the ICT manager.

Marianne Kitany Chief of Staff in the Deputy President’s ofﬁce Education · Kapchemosin Primary School in Kapsabet · Global Executive Master of Business Administration graduate Unites States International University (USIU) · Master of Science Degree in Information Systems and Communication Technology, University of Nairobi (UoN) · Bachelors of Education degree in Mathematics and Computer Science, Kenyatta University

· · · · · · · ·

Her role there involved infrastructure design, and she prides in having participated in setting up the computerised information and communication infrastructure for the Nairobi–Syokimau commuter rail project. esituma@ke.nationmedia.com

Career KCB Kenya Railway Corporation Energy Regulatory Commission Kenya Polytechnic (Kenya Technical University of Kenya) GlaxoSmithKline Deacons Kenya Ltd Strathmore University’s Faculty of Information Technology Hamilton Harrison & Mathews Advocates

Marianne Kitany. ILLUSTRATION BY STANSLAUS MANTHI

Friday April 17, 2015 | BUSINESS DAILY

Featu≥es | Viewpoints | P≥oﬁles | Analysis

THE WEEKENDER

Man About Town

Shocke≥ ove≥ my little boy’s vulga≥ language SCHOOL TRIP His schoolwork had nothing to talk

about, just lots of scribbles and splashes of paint

here are times when I wish I could clone later.” On our way to school Maingi was very exmyself because there are so many demands cited, talking about his teacher and classmates. I on my time and resources. feigned enthusiasm, thinking of how fast I needed Last Friday was closing day for Maingi and Shi- to go in, make a technical appearance and be in ro insisted that we go together. I told her that I had the office by 10am. many things to do in the office, that At the school one would have I also wanted to interview a number thought we were at a presidential Your son is of people for our side business. event; what with all the decora‘‘How can you be interviewtions, public address systems and very good in ing people? I thought we agreed well-dressed ushers. class but he After signing the visitor’s book one that my sister will take over?” she has a habit of the ushers presented us with what asked. Truth be told, I do not want of abusing any relatives near the shop let alone she called the Maingi’s Pack, detailing classmates Shiro’s sister. the day’s programme. using vulMy eyes quickly scanned the proI have spotted her in a number gar words of pubs here in Nairobi with rather gramme only to realise that it was suspicious looking characters. scheduled to end at 2 pm. What was This was not the time to tell I to do? I had not even informed the Shiro about that, so I told her: “ I am looking at boss that I was away. I told Shiro, ‘‘babes, I do not all options and especially because we will have to think I can stay for the whole event. I must get accommodate your sister and you have already back to the office.’’ pointed out how squashed our living quarters are.” She gave me a cold stare and said, ‘‘No way! I She started to raise some objections so I said, ‘‘Time asked you on Monday and you told me that you had is running out, let us go to school. We can discuss cleared your schedule and would be here all the

time; so quit lying.” I had clearly forgotten about that conversation so I decided to do some damage control with the boss. I stepped aside and called him. I gave him a soap story about how my son had been crying all week long demanding my attendance and how I had been shocked to discover how long the programme was.

Response stunned me My boss’ response stunned me. He told me not to ever miss out on such important occasions. ‘‘I have one or two documents that you need to prepare but you can pop in tomorrow and work on them,” he concluded. On one hand I was relieved that he was understanding, on the other hand I was a bit miffed that I would have to come into the office on Saturday. The day was not too bad, it was actually tolerable. We started off with a lecture by a child psychologist who spent about half an hour telling

Quotable quotes

PHOTO BILLY MUTAI

The governor’s job is not as easy as throwing stones in the streets, it requires seriousness and education. KIAMBU GOVERNOR WILLIAM KABOGO DISMISSING FERDINARD WAITITU’S QUEST FOR THE SEAT IN 2017.

We know where we have come from and where we are going. The President and I are very united, let the newspapers write, we will read them and after that we will use them to wrap meat. DEPUTY PRESIDENT WILLIAM RUTO DISMISSING MEDIA REPORTS THAT HIS RELATIONSHIP WITH PRESIDENT UHURU KENYATTA IS UNSTABLE.

us how important it is to do homework with our children and how we must affirm them always. We then had one-on-one sessions with Maingi’s teachers who showed us his schoolwork and said that he held a lot of promise. His schoolwork had nothing to talk about , just lots of scribbles and splashes of paint; but if the teachers thought it was okay who am I to argue? At the last stop the class teacher told us that she wanted to talk to us privately and ushered us into an office. I was shocked by this turn of events. She seemed embarrassed as she said, ‘‘Your son is very good in class but he has this habit of abusing his classmates using very vulgar words in his mother tongue, I cannot even repeat them.” I sat quietly as she said, ‘‘you need to find out where he is picking this language from. Is it from his nanny or peers? You must fix it. If he does not stop this habit we might consider expelling him.” I was lost for words.

BUSINESS DAILY | Friday April 17, 2015

Featu≥es | Reviews | P≥oﬁles | Analysis

THE WEEKENDER

Theatre

Theat≥e gets state-of-a≥t makeove≥ as Kaggia play ≥etu≥ns to the stage RENOVATION Wario says facility will be game-changer after the

repairs are completed giving dilapidated colonial ediﬁce new look

Kenya National Theatre mainstage from the balcony.. MARGARETTA WA GACHERU

BY MARGARETTA WA GACHERU

he Kenya National Theatre (KNT) has been undergoing an extreme make-over in the last few months which is almost complete as local artists, accompanying Culture Cabinet secretary Hassan Wario around the facility, saw ﬁrst-hand late last week when they went to see him about other matters. “Its completion will be a ‘game-changer’” said Dr Wario referring to the near future when KNT will be fully renovated and the public will see a state-of-the-art theatre, nothing like the dilapidated performance space originally built by the British back in the early 1950s. The government was fortunate to ﬁnd a generous partner in this game-changing process. Indeed, East African Breweries Ltd deserves all the credit for footing the bill and bringing in the technical expertise to transform the entire theatre space.

Everything from ﬂoors to ceilings to the upstairs bar and downstairs air-conditioning system have been either redone totally or fully repaired. There’s sound-prooﬁng between the spacious upstairs and the downstairs stage; there’s also a total replacement of the sound and lighting systems and even the ladies and gents loos have been redone, including a brand new stone structure situated just next to the theatre itself. “They’ll be for the public attending out-

Upstairs bar under construction at KNT is going to be more expansive and soundproofed. MARGARETTA WA GACHERU

door events on the theatre grounds,” said Rooprai Harbir, EABL’s contractor but seconded to the KNT project. Noting he knows the original KNT contractor, Mr Harbir says he aims to retain the solid substantiality of the original edifice while simultaneously bringing in the most modern materials and technology. According to Kenya Cultural Centre executive director Aghan Odero, the theatre will have a slightly smaller seating arrangement, “but that’s because there will be more leg room for theatre goers and we’ve followed international standards and specifications,” Aghan said. Shortly before we went to press, Aghan notified us the new seats have been put in place, so it’s for real that after all these years, the National Theatre will finally be an institution and edifice that Kenyans can proudly claim as their own. “I spent much of my youth at the National Theatre,” recalled Dr Wario as he reminisced with local artists. “I was an actor, so like you I’m also an artist,” added the SC, addressing not performing but visual artists concerned about a whole other drama unfolding around the Venice Biennale (often deemed the “Olympics’ of the visual arts) and the socalled Kenya Pavilion which is currently being run by Italians and featuring Chinese art. The Kenyan artists had come to ensure Dr Wario understood they are not amused being misrepresented by foreigners, especially as the same scenario transpired two years ago yet nothing has changed. The local artists wanted government support to ensure the Kenya flag, Kenya name and even the so-called Kenya Pavilion be removed from the Biennale. Dr Wario endorsed the artists’ proposal that they jointly write letters to the Biennale, the Italian government, the Italian businessman who allegedly financed the ill-advised pavilion and most importantly to the Kenyan Embassy in Italy whose task it will be to ensure those demands are met.

Culture secretary Hassan Wario (left) with Kuona Trust director Sylvia Gichia and Kenya Cultural Centre director Aghan Odero. MARGARETTA WA GACHERU

At a Press conference early this week, Dr Wario read the jointly-composed statement disassociating the Kenyan government from the said pavilion and calling for the name to be changed and the Kenya flag removed. During discussions artists wanted clear-cut assurance their demands would be met in Venice. Some even plan to be at the Biennale opening to see for themselves that their embassy follows through and removes the flag and name from the pavilion. Dr Wario stated emphatically the government follow-through is assured. Meanwhile, closer to home, PAWA254 has also been renovating its space and constructing its own theatre on the floor just below the third floor space PAWA254 occupies at the YMCA Africa Alliance. To celebrate this other ‘new beginning’ in Kenyan theatre, the official inaugural performance at PAWA254’s new stage will be a freshly revised version of John Sibi Okumu’s award-winning historical drama about one of Kenya’s leading (yet least understood) freedom fighters Bildad Kaggia. Kaggia will open April 28 with the original cast, including Harry Ebale as Kaggia, Lydia Gitacha as his longsuffering adoring wife, Bruce Makau and Yiirmo Mwaura, two young filmmakers keen to understand Kaggia the man and Mau Mau leader. But this weekend, spoken-word artists with Fatuma’s Voice will precede Kaggia and make their comeback (without fanfare) also at PAWA254. Meanwhile, last night Festival of Creative Arts opened in another frolicking comedy Don’t Let Me Go, running through the weekend at Alliance Francaise. Finally, Phoenix Players open tonight in Touching Tomorrow.

Kenyan ﬁlmmake≥s make list fo≥ awa≥ds at Zanziba≥ fete again BY MWIKALI LATI

The Kenyan makers of short film Sticking Ribbons, which won the East Africa Talent Award during last year’s Zanzibar International Film Festival, have once again made the 2015 list for the award with their new production Intellectual Scum. Now with their own production company — Rocque Pictures, film director Billy Jones and producer Njue Kevin’s new film was adapted from

the article You Lazy African Intellectual Scum by Field Ruwe which was published online. “This article read something special to me. It not only challenged and inspired me, I felt it had the impact to do so among many other Africans,” says Kevin. “This article opened my eyes...It taught me that blaming someone else for your troubles is the easy way out. That’s what cowards do. That’s what we Africa as a continent have been doing for the past 50 years.”

He adds that people may argue that it highlights the problem in the continent in a stern way without offering a sustainable solution. However, he says, before finding a solution a problem must be clearly defined as the article did. After obtaining permission from the writer, he wrote a script and shared their idea with renowned actors such as Jason Corder, Mkamzee Mwatela, Kevin Samuel and Patrick Oketch who loved it and got involved in the project. Although

they encountered few challenges, shooting at the airport was diﬃcult due to budget constraints. “We pay Sh5,000 per hour to shoot at the airport and Sh2,500 per head to get onto the runway and we had a crew and cast of 40,” he says. “The mathematics wouldn’t have worked with the budget we had. We managed to shoot for seven hours.” Sticking Ribbons taught them valuable lessons in ﬁlmmaking, says Kevin. For instance, they improved

on the sound quality of the Intellectual Scum that is better than the one on Sticking Ribbons. They also added cinematic elements in the new film with the help of Jim Bishop, the director of photography, and Daniel Kent, the editor cum colourist. The film students at Kenyatta University said they started the firm to ensure that they do not seek employment after graduating in December. “This is the career we want to lead for the rest of our lives,” says Kevin.

Friday April 17, 2015 | BUSINESS DAILY

Featu≥es | Viewpoints | P≥oﬁles | Analysis

THE WEEKENDER

Obitua≥y

Ent≥ep≥eneu≥ who neve≥ let debt come in way of business takes ﬁnal bow TRIBUTE Owner of Kunste Hotel leaves behind a mark in

hospitality industry after years of successful investments

About the businessman Late Nakuru entrepreneur Stephen Kung’u founded well-known Hotel Kunste on the Nakuru-Nairobi highway. The investor was shrewd and avoided mixing business with politics. He was media shy and very little is known about is personal life. He was also the owner of Pivot Hotel in Nakuru as well as established Club Coco Savannah and Monte Carlo in Nairobi. He gained his business acumen while serving as a councillor and powerful member of the Ministry of Commerce’ Scheme for Assistance of African Industrialists, Artisans and Businessmen in Nakuru Municipality in the late 1970s.

BY JAMES KARIUKI

akuru’s Hotel Kunste is well known to travellers. But its owner, Stephen Kung’u, has always lurked behind its success — opting to steer away from media limelight. When he passed on last week at his Shabab Estate home, media coverage was not wide, though his investments in the town — Pivot Hotel and Club Coco — are well known. At one time, he also owned Nairobi’s Monte Carlo club. In 2001, Kung’u appeared in the news, which hardly happened, in a case in which he had sued his son for trespass, threatening workers and scaring away customers. But the son, Michael Ryan Kung’u, said in a replying aﬃdavit that had been barred from his father’s properties because he was HIV positive. Once a councillor in Nakuru in late 1970s and early 1980s, Kung’u had become powerful as a member of the Ministry of Commerce’ Scheme for Assistance of African Industrialists, Artisans and Businessmen in Nakuru. It is here that he honed his business acumen although Commerce minister cancelled his appointment in 1980. Kung’u led a private life and burial arrangements at Pivot Hotel were private as well with family members opting for little or no pestering from the media. In Nakuru, Kung’u’s trademark smile came to be the face of his businesses that he solely managed to a very ripe old age leaving a rich legacy in the hospitality industry. Despite his advanced age, he seems to have understood that millions of money lay in romance, music and alcohol. His Pivot Hotel is a 24-hour club complete with a discotheque, extensive bar counters as well as rooms. For most of his investing life, Kingu did not mix politics with business opting to take a narrow neutral path. When he built the Three Star Kunste Hotel, he was able to host Kanu regional delegate meetings that lasted for days and when they left the opposition parties would book the same venue. All he cared for was business and did not want his investments to be associated with any particular political group. Club Coco Savanna was established to tap young revellers and was managed by his brother in the former Hughes Building. In 1998, he sold the business to his late brother, James Kagiri, an issue which later became part of the succession tussle with one of Kagiri’s wives insisting it was not part of his (Kagiri’s) estate. Club Coco did not survive the family

Late German author Guenter Grass. AFP

Nobel Prize-winning German novelist Guenter Grass dies at age of 87

rows and was closed down. But Pivot, located in a highly preferred residential and commercial zone with ample car parking has become one of Kung’u’s flagship projects. The late entrepreneur’s secret to success was a tip he always gave to his close associates whom he liked talking to — albeit on rare occasions: “If you want to become poor, fail to pay debts.” And for the high and mighty in politics, government and religious circles who prefer a quiet place to while away the evening or hold a meeting of about 500 people, Kunste is the place to go, especially after its recent acquisition of an extra parcel of land that enabled it to cater for open air gatherings for about 5,000 people. Bahati MP Kimani Ngunjiri describes Kung’u as a hard-working man whose zeal for hotel business was unrivalled in Nakuru saying he was an iconic figure and one of the pillars of the county whose establishments remain major landmarks in the town. So attached to his businesses was he that Mr Kung’u got agitated when some well-connected people obtained allotment letters for two plots infront of Kunste hotel on May, 3 1993. He immediately moved to court saying if developed, his hotel, classified as a tourist facility would have its view blocked from the Nakuru-Nairobi highway. The case which ended at the Court of Appeal in his favour is the best exposition on Kung’u’s grasp on business ideas now and in the future. The idea to construct Kunste Hotel was mooted in the early seventies when he applied to be allocated the parcel of land saying he wished to build a tourist facility. On August 26, 1976, Mr Kung’u wrote to the Commissioner of Land seeking assurance that nothing would be built infront of

Hotel Kunste in Nakuru SULEIMAN MBATIAH his hotel saying it would blur its view from the Nakuru-Nairobi Highway where plot B was located infront of his facility (Plot A) and it met Plot C at the Nakuru-Nyahururu highway intersection completing the L-shaped reserve infront of his plot B that Kunste was to be built then. “I would like to request you... that site C be left a road reserve and not for any future alienation or if that is not possible then A, B and C be amalgamated into one plot and if it is felt very necessary the hotel boundary may leave out B so that, the hotel covers A and C only,” read part of his request that gained positive approval then. And when the two parcels of land were allocated to private developers in 1993, Mr Kung’u moved to court seeking to restore his rights as the first person to be considered if the two plots were to be alienated. The then, Nakuru resident judge, Justice David Maitai Rimita, granted him his wish but the Commissioner of Land appealed saying Mr Kung’u had usurped his role. Interestingly, the Court of Appeal wondered why the Commissioner of Land was fighting on behalf of private individuals and openly complained that was a misuse of public funds. Kung’u had his day in court. So reserved was Mr Kung’u that Nakuru people only heard of his presence after he had left his establishments where he spent his time ushering in customers or ‘holed’ up in his office writing cheques to clear debts. As he lived a reclusive life, Kung’u reportedly asked his family to ensure that he goes to the grave quietly without much fanfare. kamaukariuki@gmail.com

erman novelist Guenter Grass, the Nobel Prize-winning author of The Tin Drum, an epic treatment of the Nazi era, died on Monday at the age of 87. A broad-shouldered man with a drooping moustache, Grass spurned the German tradition of keeping a cool intellectual distance, insisting that a writer’s duty was to be at the frontline of moral and political debate. For many, he was the voice of a German generation that came of age in World War Two and bore the burden of their parents’ guilt for the atrocities of the Nazis. The independent German Cultural Council called him “more than a writer ... a seismograph for society” and the Anglo-Indian novelist Salman Rushdie called him “a true giant, inspiration, and friend”. However, Grass’s concealment until 2006 of the fact that he had served in a Nazi WaffenSS regiment as a teenager cost him some of his moral authority. Although hailed as a literary innovator for his magical realist style, Grass was more likely to use public platforms to air his views on issues such as nuclear power and Germans’ historical responsibility than to discuss the craft of novel-writing. A seasoned left-wing campaigner, he was a towering figure in West Germans’ efforts to keep the door open to their Communist-ruled cousins in the east during the Cold War. Yet Grass opposed hasty reunification after the Berlin Wall fell in 1989, and hoped a new generation of German authors from the east would nourish their work on “western arrogance”. Grass was born in the Baltic port of Danzig, now Gdansk in Poland, in 1927 and much of his fiction was set in the city. The Tin Drum caused a sensation when it was published in 1959, though it was condemned by some as obscene. Former West German president Heinrich Luebke is said to have remarked that he would not sit at the same table with a man whose work he could not discuss with his wife in the privacy of their bedroom. The book is told through the eyes of Oskar Matzerath, a strange, gifted boy who resolves to stop growing just as Nazism emerges in the 1930s, and relentlessly pounds the drum of the title. It was made into an Oscar-winning film in 1979 by Volker Schloendorff. - REUTERS

BUSINESS DAILY | Friday April 17, 2015

Featu≥es | Viewpoints | P≥oﬁles | Analysis

THE WEEKENDER

Book Review

NEW IN MOMBASA

Autho≥ explo≥es abandoned sites

Diani Place in South Coast with 21 furnished apartments gives a home away experience while on vacation. The one-bedroomed apartments have stylish interior decor and furnishings, which have a blend of modern luxury and traditional Swahili culture. It has a restaurant, swimming pool, stand-by generator, WiFi connection, rooftop parking slots, conference facilities, a bore hole and security ofﬁcers manning the premises day and night. The apartments are located on Diani Beach opposite the Forty Thieves Beach Bar and Restaurant in Kwale. Diani Place was opened in December 2014. LABAN WALLOGA

Bestsellers 11. “A Spool of Blue Thread” by Anne Tyler (Knopf)

1. “The Girl on the Train” by Paula Hawkins (Riverhead)

12. “The Assassin” by Cussler/Scott (Putnam)

3. “The Shadows” by J.R. Ward (NAL)

13. “The Buried Giant” by Kazuo Ishiguro (Knopf) 14. “The Skull Throne” by Peter V. Brett (Del Rey) 15. “The Outlandish Companion” by Diana Gabaldon (Delacorte)

4. “All the Light We Cannot See” by Anthony Doerr (Scribner)

HARDCOVER NONFICTION

5. “NYPD Red 3” by James Patterson and Marshal Karp (Little, Brown)

1. “Dead Wake” by Erik Larson (Crown)

6. “The Patriot Threat” by Steve Barry (Minotaur)

2. “The Life-Changing Magic of Tidying up” by Marie Kondo (Ten Speed)

7. “At the Water’s Edge” by Sara Gruen (Spiegel & Grau) 8. “Last One Home” by Debbie Macomber (Ballantine)

3. “Trisha’s Table” by Trisha Yearwood (Clarkson Potter)

4. “Get What’s Yours” by Laurence Kotlikoff, Philip Moeller and Paul Solman 10. “The Nightingale” by Kristin Hannah (St. (Simon & Schuster) Martin’s Press) 5. “Being Mortal” by Atul 9. “Prodigal Son” by Danielle Steel (Delacorte)

There’s the story behind the deployment of nuclear weapons to Vogelsang, the Soviet-built military camp in the middle of nowhere. Erich Honecker, the former East German leader, had a colossal bunker built underground in a forest north of Berlin.

There are empty buildings all over the world. What’s different about them in Berlin?

To be honest, it was just a bit of fun. I had my own personal blog, which I started for family and friends at home in Ireland when I moved abroad. Then I went to the Spreepark and I could not believe what I saw ... Then somebody told me about Teufelsberg, the abandoned NSA listening station. I researched the story. And then it just took on life on its own.

There is usually a sort of tragic history behind them being abandoned ... For me it’s kind of a powerful mix to have the stories illustrated by the abandoned places as they are now.

What are some of the tragedies?

HARDCOVER FICTION

2. “The Stranger” by Harlan Coben (Dutton)

Even as real estate prices in Berlin rise inexorably and gentriﬁcation turns rundown corners into trendy neighbourhoods, the German capital is still ﬁlled with eerie pockets of empty spaces and abandoned buildings. Ghost-like structures and vacant amusement parks that haven’t tempted investors yet are overgrown with trees and shrubbery. They range from deserted mansions to apocalyptic bunkers, disused hospitals and even the 1936 Olympic village. Irish writer Ciaran Fahey, who moved to Berlin in 2008, was so fascinated that he started a now-popular blog called “Abandoned Berlin” and has just turned it into a book. Mr Fahey spoke to Reuters in Berlin about his book.

Gawande (Metropolitan) 6. “The 20/20 Diet” by Phil McGraw (Bird Street Books) 7. “Killing Patton” by Bill O’Reilly and Martin Dugard (Henry Holt and Co.) 8. “H is for Hawk” by Helen Macdonald (Grove) 9. “Becoming Steve Jobs” by Brent Schlender and Rick Tetzeli (Crown Business) 10. “Better Than Before” by Gretchen Rubin (Crown)

There’s Spreepark, the former East German amusement park, taken over by a family with big ambitions after uniﬁcation. It started well enough, but fell on hard times. The owner ended up trying to smuggle a huge amount of cocaine back to Germany from Peru in one of the rides. His son is still in a Lima prison. Then there’s the Garbaty cigarette factory and a Jewish family persecuted by the Nazis. They were lucky enough to escape with their lives I guess, but they lost everything else.

What is your favourite?

What role does the narrative of German history play? Berlin is so unique because of all the crazy stuﬀ between the wars, the Berlin Wall, and the Cold War. If you take them on their own, there’s an unbelievable richness of stories that in a way can’t possibly be written. People focus on the better known things like the Berlin Wall.

What prompted you to start a blog about it?

You didn’t think anyone would care about these places? I didn’t know anyone who was even remotely interested in this stuﬀ. It started almost as something I wrote just for myself. I was really surprised that there was so much interest.

Did you ever get into trouble while urban exploring? Yeah, a few times. In the Spreepark I had to run away and jump over the fence. A security guard at another spot caught me. -REUTERS

11. “Every Day I Fight” by Stuart Scott (Penguin/Blue Rider) 12. “Yes Please” by Amy Poehler (Dey Street Books) 13. “Thug Kitchen” by Thug Kitchen (Rodale) 14. “Money: Master the Game” by Tony Robbins (Simon & Schuster) 15. “In Defense of a Liberal Education” by Fareed Zakaria (Norton)

A three-dimensional installation representing the storming of Berlin by the Soviet army . FILE

Friday April 17, 2015 | BUSINESS DAILY

THE GOLF COURSE

THE WEEKENDER

The futu≥e lies in young golfe≥s not old gua≥ds SPORTS We have failed to learn from Barclays Kenya

a hard time at the 2015 Barclays Kenya Open, he was nervous and he failed to play to his potential and missed the CUT by a mile— but he was probably the biggest winner at the championship. The experience he gained is bound to propel him to a higher golﬁng standard. In 1999, Ian Poulter played and missed the CUT at the Kenya Open, he never returned. Instead, he built on this loss and went on to become one of the best golfers in the world. In 2013, the KGU included three juniors in the team, Mohit Mediratta, Abraham Galgalo and John Mburu. In 2014, they included Daniel Nduva, Wahome, Adel Balala and Mohit Mediratta. The team that ﬂew out this week includes only one junior, the 17-year-old Wahome. So, perhaps in their defence, the Union has been properly guided in the past, but not this week. Sending a team that includes have-been amateur golfers with truly no future in golf is a waste of opportunity and resources.

Open, let golf union make efforts to nurture young players

THE GOLF TALK CHARLES GACHERU

fter the failure of Team Kenya at the 2015 Barclays Kenya Open, I was hoping that the Kenya Golf Union (KGU) would heed our collective calls as the golfing fraternity to take junior golf development more seriously. However, when the Union announced their team to the 2015 Africa Golf Championships (Zone VI), to be held at the Kitante Golf Club in Kampala, all such hopes were dashed. Once more, the Union selected players well into their retirement, players with absolutely no future in golf at the expense of junior golfers. Many successful people, nations and organisations use failure as a springboard into the future, learning from their mistakes to form the thinking for the next challenge. Colin Powel said: “Success is the result of perfection, hard work, learning from failure, loyalty, and persistence.” You see, the KGU is to blame for the mediocre performance at the Kenya Open last week. The KGU is charged with the development of golf in Kenya, its failure has allowed unprepared amateurs to join the professional ranks. The low standard of our professional golfers is a direct result of the complete breakdown in golf development at the junior ranks and the continued selection of pensioners in the Kenya amateur national team which is definitely not a step in the right direction. In my not so humble opinion, success at the Barclays Kenya Open and beyond will only come if the KGU puts into place a deliberate efforts to promote junior golf. Golf must be played in primary schools, slots into the Kenya national amateur team and Barclays Kenya Open must be the preserve of junior golfers. And where possible, the young budding junior girls must also be considered. There must be a ruthless and deliberate strategy to ensure that junior golfers are given a platform to learn from their mistakes. Nyali Golf and Country Club’s Mathew Wahome had

Beat Kenya

Mathew Wahome. FILE

Just like in the past, the 2015 Zone VI Championship will be won by South Africa, you can take that to the bank; their team of 18 and 21-yearolds have never played at the Zone VI before, yet I can bet you that they will beat Kenya’s bag of rickety bones who have played Zone VI for centuries. Kenya is likely to ﬁnish fourth or ﬁfth after Zimbabwe, Namibia and perhaps even Uganda. The SA team includes Tristen Strydom and Jovan Rebula are 18-years-old, just one year older than young Wahome, Jason Smith, Aubrey Beckley and Jade Buitendag are 21 years old, Teaghan Gauche is 23 years old whilst Matthew Spacey and Hendrikus Stoop are 24 years old. Smith is the only player who was in the 2014 SA team to this Championship. Remember these SA names, you will next see them at the Barclays Kenya Open shortly, winning. Remember the Kenyan players also, you will be competing against them at a Monthly Mug near you. Kenya will not become a regional or continental powerhouse unless the Union invests in junior golfers. Junior golfers must be exposed to as much international and local competition as possible, it is exactly what South Africa does. Paramahansa Yogananda, a renowned yogi said : “The season of failure is the best time for sowing the seeds of success.”

GOLF FIXTURES Vet Lab Tomorrow April Monthly Mug 1st Tee 7:30 M.Iraki, E.Samoei, Ian Maina, F.Wangila; 7:38 Paras Shah, Y.Saito, X.N.Iraki, M.Azad; 8:02 D.G.Muchungu, M.Muiruri, Y.Asami, K.Oba; 8:10 S.Mwatha, J.Karing’u, J.Ngugi, J.Mwangi; 8:26 W.Kinyanjui, T.Njonjo, K.H.Magnussen, O.Mbatia; 8:34 L. Magnussen, S.Gathigi, G.M.Mugo, A.Njaaga; 11:22 Rohit Shah, K.Bosire, J.G.Njenga, M.Kombo; 11:30 L.Munyua, R.Githii, C.G.Munyori, P.Odima; 11:38 B.K.Mbaya, C.Bor, K.Nkomani, W.Nadida; 11:46 F.M.Macharia, P.N.Muiruri, M.Gachui, E.Obare; 12:02 P.Mambo, N.Imbugwa, M.Gathinji, D.Ndegwa; 12:10 T.Thanawalla, Irene Maina,

J.Kirui, J.Wokabi; 12:26 D.Siyani, S.Siyani, P.Varsani; 12:34 A.Kale, W.Macharia, P.Sinkira, M.Mbugua; 1:14 OS, M.Makundi, P.Okoth. 10th Tee 8:02 K.R.Shah, B.Sivadas, R.B.Shah, J.M.Nderitu; 8:10 Joan Kiengo, Shitul Shah, Ano; 8:26 S.Morjaria, Rakesh Lakhani, S.Thakkar, U.Raikundalia; 11:22 R.Kanake, J.Ndung’u, W.Njuguna; 11:30 M.Karobia, K.Mariga, D.Gitu, J.Mureithi; 11:38 S.Maritim, M.Mwango, E.Omollo; 12:34 P. Wambugu, E.Munyiri, Ano. Limuru Country Club Competition: Building Men for Christ Sponsor: BRITAM & Joe Muchekehu Date: 18th April 2015 Morning Draw, First Tee 8.04 G Barua, N

Mungai, I Thande, B Mbugua; 8.12 P Munyi, JK Muchai, SK Ndegwa, Ano; 8.20 O Bw’omote, D Mwangi, S Ndarwa, Ano; 8.28 R Munuhe, K Chege, K Kihara, C Kihara; 8.36 K Gituma, J Paul, JW Wokabi, Ano; 8.44 S Wanderi (S), E Rahedi (S), M Kanyi (S), T Williams; 8.52 G Nganda, A Wachira, E Kigochi, P Kinyanjui; 9.00 S Kariuki, A Gichuki, B Mutunga, A Ngira; Afternoon Draw, First Tee; 11.30 VG Gitonga, C Kariuki, P Wangongu, G Wangongu; 11.38 A Wangari, A Gatimu, D Odongo, J Gathungu; 11.46 A Gachaga, KN Kamenya, J Macharia, P Angasa; 11.54 B Njoroge, K Njoroge, P Kimurwa, Ano; 12.02 J Kagiri, S Mumbi, C Kamau, D Waiganjo; 12.10 M Wambugu, T McCriﬀ, J Kimani, F Ikana; 12.18 D Ndungu, D Irimu, Y Awale, M Sumar; 12.26 J Ngonga, J Ngugi, F Mwaura, HN Njuguna; 12.34 M Mbai,

Jg Mburu, G Kahira, J Kariuki; 12.42 V Gichuru, T Waiharo, N Thiaka, Fg Kariuki; 12.50 Peter Mungai X4; 12.58 Sam Ndungu X 4 Afternoon Draw, Tenth Tee; 11.30 K Mukuria, W Gitonga, M Wairimu, EG Mbugua; 11.38 RI Njenga, N Nganga, W Wanjui, KM Gakuru; 11.46 B Gikonyo, H Njenga, P Kinuthia, R Omwansa; 11.54 I Maina, A Wachira, F Wangila, B Ngugi; 12.02 D Nyakango, MN Nyakango, P Hirani, M Nyakango; 12.10 L Kuria, P Muciri, Ano, J Karichu; 12.18 A Nzamu, G Ngaruiya, N Kaberere, C Waiganjo; 12.26 J Muchekehu(S), Z Wachira, P Waweru, R Barua; 12.34 H Mediratta, S Bhandari, J Rai, J Paurana; 12.42 J Irimu, J Murigu, S Wanguru, P Mwaura; 12.50 Britam X 4; 12.58 P Muchangi, R Mbatia, N Gitau, Dr. Mwangi;

BUSINESS DAILY | Friday April 17, 2015

THE MARKET CURVE FINANCIAL ANALYSIS & COMMENTARY with George Bodo

www.businessdailyafrica.com

FOREX 90 per cent of foreign currency loans in the country are dollar-denominated

Be≥nanke to advise hedge fund Citadel

Show us the US dolla≥, Kampala lende≥s demand U

gandan banks have seen unout. With this kind of experience, businesses see dollar borrowings as some precedented rise in foreign sort of hedge against interest rates currency lending over the fluctuations, especially as the heavy past five years. Total foreign currency election related spending kick-off in loans, as a percentage of total loans, November 2015. has doubled from 22 per cent in 2009 to 44 per cent as at December 2014. This Demand is expected to come from compares unfavourably to the scenario manufacturing and services sector of in Kenya where total foreign currency the economy, the two key sectors where lending accounted for 24 per cent at dollar lending remains very prominent. Within the manufacturing sector, the the close of 2014 (and consequently key businesses driving Kenya is always seen as the strong demand for a local currency driven dollar loans are fastmarket). Demand expected moving consumer About 90 per cent to come f≥om the goods manufacturers, of the foreign currency manufactu≥ing and loans in Uganda are dolwhich account for a lar-denominated. And third of total lending se≥vices secto≥s of ahead of the 2016 gento the sector. the economy eral elections, Ugandan Within the services banks are now bracing sector, demand is befor an even stronger deing driven by traders, mand for dollar loans. telcos, property developers, commercial and There is no established direct correlation between elecresidential mortgage providers. Howtions and dollar borrowings—however, ever, this steep growth in dollar loans the 2011 elections negatively impacted has bred two problems for the sector interest rates to the extent that comand the economy. mercial bank shilling lending rates First, banks are struggling to fisharply rose to a high of 27 per cent and nance foreign currency loans. With stayed above 22 per cent for the subsethe exception of the three large inquent 12 months after elections. ternational banks (Stanbic, Standard Chartered and Barclays) that enjoy the On the other hand, dollar borrowing rates remained very stable throughbenefit of dollar-parentage and with it

US dollar notes. FILE the ability to internalise the parent balance sheets, there are visible funding constraints for local names. And the problem is worsened by the fact that the economy’s foreign exchange earning capacity is continuing to weaken. Surprisingly, despite the visible funding constraints, banks are seemingly able to deal with the resultant re-pricing and reﬁnancing risks as net margins have remained very stable. This is very non-reﬂective of the generally thin-margin nature of foreign currency lending. Additionally, it is also an indication of a general price insensitivity of borrowers, since, it seems, banks are able to comfortably pass-on any volatilities in the funding market. Second, growing demand for dollar loans has increasingly led to the dollarisation of Uganda’s economy. Before banks lend in foreign currency, they

usually demand for evidence of equivalent foreign currency ﬂows from the potential borrower (commonly referred to as dollar-to-dollar matching). In order to qualify, businesses have had to ask for their goods and services to be paid in dollars, or at least be linked to prevailing dollar exchange rates. For instance, commercial and high end rentals in Kampala, the political and commercial capital, have increasing been quoted in dollars. Recently, traders in Kampala City decried the fact that their tax levies are increasingly being pegged on the volatile dollar exchange rates, and ﬁngered this as one of the key overheads eating into their earnings. The fact that even revenues authorities could consider pegging revenue collections on prevailing dollar exchange rates shows the severity of dollarisation of the economy. The writer is an investment analyst

GLOBAL MARKET WATCH DJ INDU 18,112.61 75.91

FTSE 100 3,284.66 -24.40

XETRA DAX 12,053.12 -178.22

en Bernanke, former chairman of the US Federal Reserve, has agreed to become a senior adviser to Citadel Investment Group, a $25 billion hedge fund founded by billionaire investor Kenneth Griffin, the New York Times reported yesterday. Bernanke, who handed the reins of the US central bank to Janet Yellen last year, will advise Citadel’s investment committees on global economic and financial issues and meet the fund’s investors, the newspaper said. Reuters was not immediately able to reach Citadel or Bernanke for comment outside regular US business hours. Big-name hedge funds are making a habit of hiring former central bankers and other government officials as their funds grow in size and scope. Bernanke’s predecessor, Alan Greenspan, joined hedge fund Paulson & Co as adviser in 2008. Jeremy Stein, a Federal Reserve Board governor for two years, joined hedge fund BlueMountain as a consultant last month. Bernanke told the New York Times that he was sensitive to public anxiety about the “revolving door” between Wall Street and Washington. He chose Citadel, in part, because the fund is not regulated by the Federal Reserve and his role would not involve any lobbying. Bernanke told the newspaper that he had declined offers from banks. Chicago-based Citadel, founded in 1990, is a multi-strategy hedge fund and ranks as one of the industry’s biggest. Bernanke will receive an annual fee, which he did not disclose, but will neither own a stake nor receive a bonus based on the fund’s performance. -REUTERS

CURRENCY RATES CAC 40 5,224.71 -29.64

FTSE MIB 23,752.77 -277.77

SMI PR 9,404.65 -23.90

HANG SENG 27,739.71 120.89

NIKKEI 225 19,885.77 16.01

ALL ORD. 5,917.62 40.29

SSE COMP. 4,194.65 110.49

S&P SENSEX 28,666.04 -133.65

$: 93.42 €: 99.72 £: 138.47

TSh USh SAR

20.14 32.06 7.74

Market Activity MARKET CAP IN SH BN TOTAL SHARES TRADED

PREVIOUS 2,392.49

15,517,900

11,430,500

590,596,074

401,201,361

1,272,300,000

1,074,550,000

EQUITY TURNOVER IN SH BONDS TURNOVER

LAST 2,399.38

TOTAL DEALS (BONDS) TOTAL DEALS (EQUITY) NSE 20 SHARE INDEX NSE ALL SHARE INDEX

1,572

1,928

5,078.74

5,126.02

171.57

171.07

879.00

875.01

FTSE NSE KENYA 15 INDEX

228.77

225.78

FTSE NSE KENYA 25 INDEX

228.84

226.15

92.21

92.42

1,238.45

1,237.32

PINEBRIDGE INDEX

FTSE NSE KENYA BOND INDEX FTSE ASEA PAN AFRICAN INDEX

HE SAID

Download the NMG PLAY app on Google Play and scan this QR code with your smart phone for pictures, videos and more stories

“All those who seek to destroy the liberties of a democratic nation ought to know that war is the surest and shortest means to accomplish it.” - Alexis de Tocqueville French political thinker

www.businessdailyafrica.com

The business of taking a break

Explosion of aﬄuence at Indian fashion show >>PAGES 12-13

17th APRIL, 2015 - 23th APRIL, 2015

Keep kids busy du≥ing holidays A lot is on o≠e≥ fo≥ eve≥y taste >>PAGES 8 & 9

Meet a brave CEO >>3 | Home decorations from old bottles>>5 | Prepare for ﬂu season>> 11

BDLIFE | Friday April 17, 2015

BDLIFE: THIS WEEK

EDITOR’S NOTE

INTERIOR

THE ACTIVE LIFE

HEALTH

EAT OUT

here are parents who simply dread the school holiday season when children are at home throughout the day. You can’t help worrying about what they could be upto in your absence with all gadgets available at their fingertips. Long ago, parents would ship children away to spend time in the village with their grandparents and cousins who lived there. This was a good way to get them to learn about their roots and how the other half lived. Today, you can’t very well do that. They will simply tell you they are not going. So you will leave them in the house where they will tell you they are bored stiff if not infront of the TV all day long. But all is not lost. Knowing the predicament parents find themselves, in, several organisations have come up with interesting stuff to keep the children active and busy while you are at the office or at your business. Whether it’s sport, art, music, learning a foreign language or cookery, it’s all out there for children starting from age two to 17. Turn to our main story for ideas. Enjoy

Decorate your home with recycled materials

Keep children active at the Watamu triathlon

Preparing your child for the ﬂu season

THIS WEEK’S PHOTO

Rhoda O≥engo

Delectable food at Caramel lounge

COMMENTS MEET THE PLAYERS RISING FROM DUKAWALLAHS TO BIG HOTELIERS Kijana 2014: Business travel and conferencing is where the money is. That is why Leisure Lodge at the Coast has not closed. Corrine A: It’s time our local hoteliers learnt that you cannot depend solely on foreign tourists. Encourage locals to tour their country and hold conferences in diﬀerent towns. That’s the only way to stay aﬂoat.

Published by the Nation Media Group Kimathi Street, Nairobi PO Box 49010 GPO Nairobi Telephone 254 20 328 8104 Fax 254 20 214 849 Email: bdlife@ke.nationmedia.com www.bdafrica.com

LINUS GITAHI Chief Executive Ofﬁcer

HOW KIWANUKA MOVED FROM RECEPTION TO THE CORNER OFFICE

TOM MSHINDI Acting Editorial Director OCHIENG’ RAPURO Managing Editor

Edwin Dande: Congrats! Kenince: I liked the ﬂow of questions...nice interview.

RHODA ORENGO BDLife Editor

Napendablackskin: Lovely all rounded personality! Great values, wish her all the best.

JOAN PERERUAN Photographic Editor ISABELLA MUKUMU DOREEN WAINAINA EVELYN SITUMA MARGARETTA WA GACHERU MWIKALI LATI BILL ODIDI JACKSON BIKO Writers

Chiromo: Ain’t no interview like a Biko interview! Paul: Nice chat over tea. I like the high-breed combination Kenliks: She’s a good trainer.

GENEVIEVE NAHINGA Senior Graphic Designer

CREATIVE LOCAL FURNITURE CUTS ITS OWN NICHE

MILLIE WACHIRA STANSLAUS MANTHI Graphic Designer

Napendablackskin: Buy Kenyan build Kenya and our houses won’t look like cut-n-pastes from the neighbours.

ON THE COVER Activites that children can engage in duringthe holidays. FILE

A model poses during the Crown Paints India fashion exhibition at the Kempinski Hotel in Nairobi on Saturday. SALATON NJAU

BDLife wants to hear from you. Send photos and letters to bdlife@ke.nationmedia.com and we may publish them on this page. Follow us on Facebook.com/BUSINESSDAILYAFRICA or join and follow our conversations on twitter @BD_Africa and #BDLife. Cheers!

Friday April 17, 2015 | BDLIFE

BDLIFE: PROFILE

CEO who wants to go sha≥k-cage diving Ba≥clays Bank CEO Je≥emy Awo≥i wants to see golf embedded ac≥oss the count≥y as a discipline of cama≥ade≥ie, to p≥omote Kenya as a key golf tou≥ism destination and also to eventually g≥oom fellows who will win the US Maste≥s. “And why not?” he posed. We met in his o∞ce along Waiyaki Way. A most engaging inte≥viewee he - like a tho≥oughb≥ed champion boxe≥ – f≥equently danced a≥ound my questions with such an a≥≥esting p≥ose, depth and eloquence that I was simply left in awe. There is a large poster in the next meeting room that says, “to be rich, to be happy”, is there a truism to that? For sure.

So wealth brings happiness? You have a high chance of being happy, yes. If you are at the bottom of the spectrum, it’s not very easy to be happy when you can’t feed your family, but there comes a point also when excess money won’t make much of a difference. So one earning 100 million dollars and a billion dollars is not big difference but one earning 10,000 dollars and a million dollars is a big difference. Paradoxically, that same money can create unhappiness, it can create conflict and other challenges but on a balance would I rather have money than not have money?

Are you happy? Yes.

So you have money? I have money, yes. (Laughs) But relatively, everything is relative here. I don’t think you need 20 cars or two helicopters.

What’s your greatest possession, intangible or tangible? Freedom to choose what I do, when I do it and how to do it.

When did you attain this freedom? I think probably in the last ﬁve years? Various things instigated it; obviously career-wise you aspire for bigger jobs…(Pause). I think it’s important to have a degree of introspection, so I spend a lot time doing that. You know we aren’t prisoners of our destinies, we control our choices and not having a choice can very well be a function of making the wrong choices.

What’s the one thing you have pursued that has always been elusive and why? It could be an idea, a state… (Laughs) You are like a psychologist; I wasn’t debriefed on this line of questioning. Well, I don’t think that there is something I’m missing because that will mean there is a vacuum and that I’m searching for something. (Pause) I think the ongoing drive and quest is to be in a position where you can make a big diﬀerence in business or in a personal context: Change a place, a country, a person.

What or who has been your greatest inﬂuence in life? I think a number of things, sports being one of them, I’ve done sports since I was like 9, swimming for Kenya until my 20s so I think that built a very competitive aspect in my life. I ﬁght to win,

When are you most vulnerable, when you are not Jeremy the CEO, or a husband or a father? (Long pause and sigh) I don’t know, there is no amount of time available for me to be vulnerable. (Laughs hard). You don’t think about it, but every time you have to do a big delivery, of course, you get a bit vulnerable. I think I’m wired diﬀerent.

Have you thought about midlife crisis, will you get a chopper or take off to Asia and live in a shack, or maybe run off with a new wife? (Laughs) I think it hits people in diﬀerent ways. What I know is that this decade will be the best I have ever had and the next will be even better - God willing. I think as one progresses, you realise you need to do what you need to do and tick them oﬀ. Am I going to try to dress like a teenager? My kids won’t even allow it. But in your 40s you ask yourself; what am I here for?

and I don’t want to lose, that becomes an inherent driver in whatever I do. Then family; the way my family has lived a life of higher aspiration but also one that hinges on humility and respect. This is very important.

Just how big has the family name – Awori loomed over your life and with what impact?

What is on your Bucket List? I would want to do shark-cage diving. I tried it once but the weather was against me. I tried to skydive in Dubai last weekend but they were fully booked. I would like to visit South America and experience the Rio Carnival when I’m not a pensioner. (Laughs) I also want to go to Cuba. Most of these things I want to do with the kids, to give them special and lasting memories.

Yes, it has been very impactful. There are a lot of people who might want to justify their lives - that you got what you have by virtue of your family name; that has always been a feature in my life and career. It was more of an issue when I was young, not now. Before 30, I was already running a huge business in East Africa, people thought the position deserved an older person. There are high expectations from the name, we are fortunate to have had many successful Aworis in the past, and I would never want to let the name - or family - down. I wouldn’t want to bring disrepute to the family, it’s critical.

What’s the riskiest thing you have ever done? The decision to work in the Middle East back in 2003 was a massive decision. I had achieved success in Kenya and there I was going into a completely diﬀerent market; I wasn’t Muslim, it was a new market, a new product, new culture, new environment and I would have failed. There were no examples of Africans who had been there before me and I was the youngest business leader in Standard Chartered Bank, and they were giving me a responsibility to run this business that was bigger than the whole of Africa at 32 years of age. Big risk!

At 44, what are you struggling with right now? The challenge is to balance all this. There are expectations all around. I think when you are CEO, everything comes back to you ultimately and that comes with responsibility. You are on the job round the clock. There is never enough time; how do I become more efficient with time? Money you can get back, time you can’t and I need to use it effectively to balance everything out. I tend to work too hard and it affects relationships with my close relations.

What part of this job do you least enjoy?

PHOTO /COURTESY

BY JACKSON BIKO

(Chuckles) You would have to ask the wife. (Pause). I will answer you this way; I give more time to the bank. Probably I shouldn’t.

JEREMY AWORI CEO, Barclays Bank Age: 44

I think the very long hours. I have many competing demands that make it tough because you have to make a trade-off. There are people who knock off at 5 and go to the bar and forget work until the next day. You can’t knock off at 5 when you sit at my desk.

Is it really that cold at the top? (Pause) I think it deﬁnitely can be. (Pause) It is. It deﬁnitely is challenging at the top, every decision you make comes back to you. When you get to the top, you will need people to get you honest and true to your values.

Shall we talk about kids and fatherhood? Sure. I have two boys and one girl, youngest is 8 -years- old and two teenagers, the eldest, a girl, is 17.

What is your weakness as a father? Time. I need to get better at spending quality time, be fully present and available without distractions. I have brought them up to be very independent in their thinking and free to express themselves, so I frequently get raw feedback from them.

Do they like you? (Laughs) I would hope so! Maybe not all the time, maybe they like me when they like what I’m doing.

This is an unfair question, but I’m curious to see how you will handle it; are you better at being a CEO or a husband?

What’s your greatest extravagance? Cars and watches. I don’t often spend; don’t see the need but when I buy stuﬀ, it will be expensive stuﬀ.

What watch is that? It’s a Tag Heuer. I own several watches, what I wear depends on my mood. I have watches about 40-years-old, very simple but which I spend good money servicing.

What’s the price tag on that Tag? Oh no, I can’t tell you. (Laughs).

Come on tell me, what, half a million? (Laughs) You sound like my son, always pressing me to tell him how much it costs. But a good watch will last you forever, you can pass it to your kids and it becomes special.

What car are you? (Thinks) I would say probably a DB9 Aston Martin. Or maybe a Bentley.

Here is an Obama question: have you ever smoked weed - and inhaled? (Laughs loud) That for sure, I will never answer. Never!

BDLIFE | Friday April 17, 2015

BDLIFE: INTERIOR

Deco≥ate you≥ home with ≥ecycled mate≥ials WHAT SHE USES Gathoni beautiﬁes the bottles using thread, paint and beads.

She also does wall-hangings from left-over fabric.

For string art, she uses geometry.

Who would have thought those bottles we th≥ow away could make such beautiful a≥t pieces? BY ANNIE NJANJA

ecorating your home and giving it a facelift does not have to be an expensive affair. A simple art piece, when perfectly placed, can lighten-up a once dull room. The piece can even become the room’s focal point, drawing visitors’ attention from structural flaws that the room may have. Ann Gathoni is an artist who understands how simplicity can be chic when well applied in interior decoration. She has turned recycled materials into beautiful arty pieces to parade in the house or office. Using knowledge learnt from Kenyatta University’s Fine Art School and YouTube tutorials, she has managed to keep her clientele eager for the next artsy product.

Bottles

Be-Unique founder Ann Gathoni with her products made from recycled materials. PHOTOS BY DIANA NGILA

Usually, people find no use for empty glass bottles and most end-up in trash bins. But Gathoni has found a creative way to turn bottles of different colours into useful and beautiful items to display in the house and office.

“I ≥ecycle the bottles, c≥eatively making them suitable to display in va≥ious points of the house including the toilets.” Ann Gathoni, Artist

Gathoni beautifies the bottles using thread, fabric, paint, and sometimes adds character to them by embedding beads. Customer needs and colour preferences inspire every order, she says. However, Gathoni notes that clients lean towards new styles that she introduces from time to time. “I began by using fabric and thread to add personality to the bottles but as soon as I introduced painted bottles, client preference shifted,” she says. The bottles are used as replacements for flower vases. The recycled bottles are placed at various points in the house, among them the fireplace mantel, kitchen counter, dining and office tables. The beauty of decorating glass, Gathoni says, is that it can be recycled without losing its strength and quality. “I recycle the bottles creatively making them suitable to display in various points of the house including the toilets,” she says. “Some clients order large bottles for their hallways.” A bottle of Abro spray paint, which retails at Sh400, decorates three bottles, explaining the Sh500 cost per completed piece. Gathoni began exploring her passion for art in November last year - after taking a recess from the university. That marked the birth of Be Unique Creative Art and Design. She gets most of her orders through the Be Unique Facebook page, where she constantly updates her fans on her current

projects. Through her fan base and referrals, she receives a minimum 10 orders in a week.

Fabric Wall hanging Wall hangings are also used to add colour and attractiveness to a room. Gathoni also makes wall hangings. The hangings are made of leftover fabric from tailors - that would have otherwise been discarded. By combining diﬀerent colours and blending a number of pieces, she says that wall-hangings can lighten-up any dull room or wall. The wall hangings are made from African-inspired fabric, knitted on a ‘forexboard’, which can be customized into various shapes. The fabric is not restrictive and clients placing orders can get creative with their designs. A wall hanging, compromising seven pieces, costs Sh2000.

String Art String art is a thread weaving craft based on geometry, which Gathoni has also explored. It is an arty method that uses coloured threads to create patterns, with the end product being a string art piece. The threads are passed through points of a sketch to form a pattern. This technique can be used to make different figures and shapes including flowers and buildings. Because it is based on geometry, the process of making an art piece starts with calculations, Gathoni says. It takes her two days to make one piece. “On the first day, I do the calculations and drill the holes on the board,” “The main reason why it takes two days to make a piece is because the sizes of the holes differ, making the process of making a string art piece tedious.” She sells an A3 piece for Sh1,500. String art pieces, particularly those made of different colours, give walls a striking look. ANjanja@ke.nationmedia.com

Friday April 17, 2015 | BDLIFE

BDLIFE: GARDENS Use the railings for creepers(left) and smaller pots if you want many plants. PHOTOS OURTESY

Get a balcony ga≥den fo≥ you≥ apa≥tment All you need a≥e the ≥ight plants and pots fo≥ a ve≥andah full of colou≥ and life BY MWIKALI LATI

ith more of us likely to live in apartment blocks than a house with a garden, having a balcony full of potted and hanging plants is the closest you can get to having a garden. No matter the size of the balcony, a great garden can be created. Creating a piece of green heaven several metres up from the ground and working to keep it going and healthy by weeding, trimming and watering, can be relaxing. For those who love to read, this can be the place to sit and enjoy a good book. To get a balcony garden, begin by buying the right plants and pots. “Since they are not indoor plants, there is plenty to choose from. Plants love light and shade and you can get plants for the balcony that are similar to the ones for gardens,” says Francis Mureithi, who sells plants and clay pots opposite Village Market in Nairobi.

Hanging plants Some of the plants recommended are geraniums, Impatiens, Ferns and Golden Palms. The former two have bright small colourful ﬂowers and the last two plants are green – no ﬂowers. It is up to you to decide whether you want more colour or green which will essentially make the balcony feel like a forest. These plants cost between Sh500 to Sh3,000.

Hanging plants can also add life to your balcony garden and a mixed hanging, two plants in one pot, adds drama. A popular hanging plant is the fern which has countless varieties to choose from. Golden Palms come in many varieties, you should ask for the variety that grows slowly so that its roots do not break the pot. It is also advisable to transplant them in big pots to give them room to grow. They grow tall thus can oﬀer privacy in your balcony.

Pros and cons Be sure not to overpopulate the balcony with plants; apart from considering the size of the balcony, ﬁnd out whether or not the plant you are about to buy is a spreading one or not. You will need less of spreading ones for you not to have a crowded balcony. Next to choose are the pots to buy; clay – painted or not painted, plastic or concrete. Each have their pros and cons for example, the concrete pots are mostly rectangular and, of course, heavy. It can be painted or left in its grey colour which gives the balcony an industrial look.

Use pebbles and stones for dramatic effect

Pots Transplanting to a pot is easy. Hold up the bag and turn it upside down and pull the plastic paper gently without disturbing the roots. Place plant in the pot with a bed of fresh soil prepared then ﬁll up with the soil. A balcony garden gives you a place to party with family and friends and it can be as good as a real garden.

Children Francis recommends plastic pots if you have young children as they will not break if they hit them while playing. They are also easy to wipe

when they write on them too. One of its disadvantages is that it comes mostly in two colours, brown and green, and cannot be painted. If exposed to the sun for a long time, it heats up thus aﬀecting the temperature of the roots. On hot days, water the plants more and often. Clay pots oﬀer the plants’ roots a better environment and help prevent overwatering as they are porous, that is if they not vanished or painted. They cost between Sh200 to Sh5,000 depending on the size and style. You can order for one to be made or painted – which will be cheaper. With the plants and pots in hand, it’s time to transplant. Some of the plant sellers have soil and manure to sell. You can ask them to mix it in the right portions; too much manure can dry up the plant.

Use abigger container for your vegetables and herbs

mwikalilati@gmail.com

BDLIFE | Friday April 17, 2015

BDLIFE: ACTIVE LIFE Participants under six years participate in a past Mombasa Open Triathlon Challenge. FILE

ACTIVE LIFE BRIEF

Wo≥kplace wo≥kouts can snag on st≥essful co≥po≥ate cultu≥e

Keep child≥en active at the Watamu t≥iathlon They a≥e expected to ≥un and swim ove≥ sho≥t distances in age g≥oups

Young cyclists taking part in the late Suleiman Said Memorial Cycling Race at Mama Ngina Drive in Mombasa. He was a one-time chairman of Kenya Triathlon Association. FILE

BY SANDRA CHAO-BLASTO Sh4,000 to participate in the races, children ith schools closed, it is important aged between 5 and 15 years will register with to have your children engaged in half the price. both physical and mental activities Speaking to BDLife, Aida Rajab - the Chief rather than have them sit around the house executive of H&A Sports, which organises the triathlon said that it would prowatching television or on the vide a perfect bonding opportucomputer all day long. nity for not just families but also If you are looking for some “It’s a way of fun things to do with your chilgroups looking at other creative p≥omoting dren this weekend, you could ways to spend time together. opt to ‘go tri’ by participating in “It is a way of promoting healthy the annual Watamu triathlon healthy living among Kenyans living among and having it in Watamu serves as from tomorrow. The triathlon taking place at another purpose of promoting Kenyans.” the Turtle Bay Beach Hotel will both local and international tourfeature races for not just adults ism,” she said Aida Rajab, Chief but children as well. Ms Rajab said that part of executive of H&A Sports the registration fees collected Aquathon over the weekend will be used The event is expected to to fund community-based edubring together over 200 local cation projects at Watamu Priand international professionals mary School. as well as amateur athletes of all ages to particiBefore participating in the race, children pate in the multistage sports activities. will be grouped according to age with diﬀerThe children’s aquathon will take place ences of at most two years in order to avoid on Saturday, with the children expected to unfair competition. run and swim over short distances. The adult Those aged between ﬁve and seven years, triathlon will, in addition to the two sporting for instance, will be expected to run 100 metres , also include cycling. before swimming for 25 metres and running While adults will be registering with another 100 metres.

Olympic The distance for running and swimming increases progressively with each age group Adults, on the other hand, can choose to participate in the Olympic triathlon where they will be required to swim for 1.5 kilometres, cycle for 40 kilometres before running for another 10 kilometres. There is also the sprint individual race which is less strenuous as one swims for 750 metres, cycles for 20 kilometres and only runs for ﬁve kilometres. Better still is the sprint relay team race that allows the ‘amateurs’ to participate in the less strenuous race in a team of three individuals. schao@ke.nationmedia.com

s evidence mounts that fit employees are productive workers, companies have slotted into the corporate routine an array of workplace workout initiatives, from in-house gyms to lunchtime yoga. But fitness experts say even the best-intentioned get-fit efforts can flounder before the demands of a corporate culture that is stressful, sedentary and increasingly round-the-clock. “This demand for 24/7 access, “Fo≥ this idea that I can always access employees you and you should intensely, immediately respond, is a stressor, to pe≥fo≥m and we know from studies that chronic stress will shorten your at thei≥ best, life and ultimately kill you,” said they need Dr. Mary Ellen Rose, a Washington, D.C.-based consultant for to be fit, yet workplace health promotion. wo≥kplaces Rose believes that even the wearable fitness bands and have become watches meant to keep exercisers on track can be counter-proanti-fit and ductive. inc≥easingly “When you’re happy and healthy, you’re more productive,” sedenta≥y... she said. “But for people who are We need to high anxiety, monitoring every little thing becomes a stressor.” ≥aise that Patrick Hitchins, co-founder of FitRankings, a Texas-based fitawa≥eness ness tech company that ranks the on the fitness levels of individuals and companies, notes that most fit co≥po≥ate people in a company are usually level that the executives. “For employees to perform at its fitness their best, they need to be fit, yet is cheape≥ workplaces have become anti-fit and increasingly sedentary,” he than a said. Hitchins believes companies t≥ip to the have a long way to go before they hospital.” see their employees as athletes rather than as cogs in a machine. Patrick Hitchins, “(We need) to raise that awareco-founder of ness on the corporate level that its FitRankings (fitness) is cheaper than a trip to the hospital,” he said. “One of the challenges is (creating the) acceptance that you can work out at lunch and come back to the desk sweaty,” said New York-based Brue. “Culturally, there needs to be a shift, so workers can roll into office from their workout.” “We also need to get out the message that it’s as important to unplug and to, say, meditate as it is to be always and immediately responsive, “ she said. -

Reuters

Friday April 17, 2015 | BDLIFE

BDLIFE: TRAVELLER

English Point boutique hotel opens in Mombasa The deck a≥ea of the hotel is popula≥ with shisha love≥s BY EVELYN SITUMA

he English Point Marina has opened its 26-room boutique hotel ahead of the main launch planned for later in the year. The Marina hotel, which had a soft opening a month ago, has also opened the deck area where there’s a bar, spa and restaurant at the Sh5billion property for non-residents. It’s set to oﬀer guests visiting Mombasa’s Nyali area a great place to hang out. Previously, guests only had the Tamarind Village apartments, owned and operated by the Tamarind Group which has been a favourite and the only option for guests around Nyali. The hotel also opened its doors to corporates eager to host events at the lavish development.

Most of the corporates prefer the deck which has an extensive boardwalk that juts into the sea giving it a beautiful ambiance. Simba Colt Motors was among the ﬁrst corporate clients to host a cocktail party at the deck for its high net worth clients.

Boardwalk The ambience at the deck at night is breathtaking. On a raised platform, guests can watch Mombasa light up creating a memorable spectacle. The wooden deck has a fantastic view of the Old Town and Fort Jesus from the Marina restaurant and the Indian Ocean which is just below the boardwalk and has surrounded the facility on one side. The other side of the deck has the

One of the bedrooms with African print bedding.

marina where yacht owners can moor their vessels. The there are several shops at the deck - two of which sell coﬀee and liquor to those catching the sunset at the marina. In the afternoons, families pack the boardwalk and lounge area with its brightly coloured bean bags. It’s also a favourite spot for shisha lovers. The Ansui Spa is operational and is a match for any international standard spa, with its numerous treatment and changing rooms.

The boutique hotel of English Point Marina in Mombasa. PHOTOS COURTESY ENGLISH POINT such a facility. They also have a fully-functional gym for residents and non-residents. The restaurant has a diverse a la carte menu that caters for every palate. Next to it, by the entrance is a jazz bar with impressive artwork from local artists.

Rooms The bar is fully stocked with choice whisky and beers. The ambience at the restaurant is similar to those in the rooms. Spacious, with piped music playing softly in the background.

Spa The spa oﬀers Vichy shower body scrubs, anti-cellulite treatment, body electrical, facials, Swedish and couple massage apart from the usual grooming care one would ﬁnd in

A spacious suite a the hotel.

A standard room costs Sh15,000 a night while the suite goes for Sh20,000 a night. There is also a conference room for those wishing to hold meetings or conduct a conference call from the conﬁnes of the hotel. The Marina apartments are also open for short and long-term lease. Daily rates start from Sh17,000. The Nyali shopping centre is close by for those staying in the self-catering apartments, as is the Nyali Cinemax complex for those who want to venture out for a movie. esituma@ke.nationmedia.com

BDLIFE | Friday April 17, 2015

Friday April 17, 2015 | BDLIFE

BDLIFE: MAIN STORY

MAIN STORY: BDLIFE

SPORTS

MUSIC

Eager students at a Golf For Kids lesson.

ART

Dan Mwangi takes Marriagoretti Mbithi through Associated Board of the Royal School of Music examination pieces at the Kenya Conservatoire of Music in this File Photo

Patrick Mukabi, a holiday art tutor, with (l-r) John Aura, Zach Odhiambo, Dennis Wafula (partly hidden) and Prince Kirungu.

PHOTO/ FILE

PHOTO/ COURTESY

PHOTO MARGARETTA WA GACHERU

Keep kids busy du≥ing the holidays The≥e is a lot going on a≥ound the count≥y to keep child≥en active and away f≥om the TV o≥ compute≥ BY MWIKALI LATI

Kenya Conservatoire of Music

The holiday classes will be for two weeks mostly teaching instruments and singing. The charges are Sh900 per half hour lesson. Children from age ﬁve and up can book for lessons in any of their two branches; at the Kenya Cultural Centre and Go Down Arts Centre. Students are allowed access to the school’s pianos for practise as so long as they book between 9:00am to 4:30pm. However, with the other instruments like the guitar, violin, trumpet, ﬂute, saxophone and so on, the student needs to have his/her own instrument for lessons and for practice at home. “Students can have a lesson every day, but the school recommends up to three lessons per week which gives room for the student to practise away from the classroom,” says Director of the Kenya Conservatoire of Music, Corrine Towett.

ith school gates closed for the next few weeks, parents looking to keep their children occupied during this time have plenty to choose from. From music lessons to motivational day camps and sports activities, they are sure to keep the children busy with interesting stuﬀ that will deﬁnitely keep them away from the TV or computer.

Alliance Française With a presence in 29 countries, Alliance Française is offering holiday language school for children aged six to eight and nine to 12 classes which started on 7th of this month and runs all the way to the 24th. It is an activity-based learning module giving children a flying start in learning the French language. For three hours per day, from 1pm to 4pm, the module is divided into five rotating activities of 35 minutes each; read-along, watch-along, talk-along, play-along and sing-along. Charges are Sh11,300 for age six to eight class and Sh11, 130 for the age nine to 12 class and this includes the teaching materials. Alliance is offering a 10 per cent discount for any sibling that signs up.

Wynton House of Music Wynton House of Music always has a holiday package that oﬀers 10 half-hour lessons for Sh10,000 compared to the usual 12 half hour lessons for Sh14,400 which covers lessons in any instrument in a one-to-one session. They start taking students from age two who can be taught piano and singing. From 6 years and up, they can pick up any instrument. Two-year-olds up to age four usually have 15-minute-long lessons at

SPORTS

A tennis coach from Florida, Bill Murray, conducts a lesson at Sadili Oval. PHOTO/ FILE

Sh5,000 per two weeks during the school holidays compared to Sh7,200 during school term but for 12 lessons in 12 weeks. The holiday classes are held Monday through Saturday. “The school sells all the instruments they teach; guitar, ﬂute, drums, saxophone, violin, clarinet, trumpet, keyboard and so on,” says Winnie Muriithi, the principal. A second holiday oﬀer is the holiday camp for kids between the ages of 6 and 12 where for Sh20,000, the children get to learn how to play different musical instruments, learn music theory as well as paper art, social and hygiene manners. These sessions are held Monday through Friday for two weeks over the holidays for two weeks. The

package includes a snack and a ride back home. Students can always book to practice using the school’s pianos in any of their locations; at Yaya Centre, Village Market and Mountain Mall, along Thika Road. Non-students are also allowed to practice for Sh800 per hour. Each student should come with music exercise book, pencil, eraser and a folder for the sheet music.

Golf for Kids Started four years ago, Golf for Kids has been on a mission to spread the pleasure of playing golf - a sport that instils life skills on kids. Children from ages four to 12 years are eligible to join.

They will learn the rules and etiquette of golf, team work, hand and eye coordination. “The target is on improving on their social, psychological and physical attributes through golf,” says Emmanuel Kasio, director, Golf for Kids. Holiday camp golf lessons are held on Monday through to Friday at the following locations; Vet Labs Golf Course, Loresho, Lower Kabete road 9am-12pm April 13th-15th. Montessori Learning Centre, Brookside Drive, Westlands 2.00pm3.30pm and 3.30pm-5pm. School of the Nations, Kitisuru across from the International School of Kenya 9am-11am. Kabete Junior Academy location, Farasi lane, Lower Kabete road 2pm-3.30pm. Students who do not have their own sets are provided for by Golf for Kids. If a parent wants to buy a Junior Golf set, they range between Sh15,000 to Sh40,000 but depends on the brand and size. Regular term lessons go with the school timetable. The programme runs for 10 weeks every school term (Mondays-Saturday) and costs vary by school/location; ranges between Sh600 and Sh1,000. Golf for Kids is affiliated with the Junior Golf Foundation, US Kids Golf, PGA of America and the USGA. They use the US Kids Golf kidfriendly learning programme/curriculum to teach and also offer their certification process as a roadmap to their success.

Kusoma Tu Utamaduni Kids Camp at CITAM Woodley Located on Ngong Road, this kid’s day camp aims to teach children, aged between four and 14

WHERE TO TAKE CHILDREN Art classes around the city, Music at the Conservatoire or Wynton’s.

Holiday a≥t classes open up new ho≥izons fo≥ child≥en BY MARGARETTA WA GACHERU

You can also take them for tennis, football and golf and even swimming classes. There are also residential holiday camps

years, about the diﬀerent Kenyan cultures. The lessons include drama, dance, painting, storytelling, bead-work, crafts and drawing. Children with special needs are encouraged to attend. Classes start at 9:3am to 3:30pm with lunch and snacks provided. Charges are Sh2,000 per day or Sh7,000 per week. It ends on April 24.

Sadili Oval Sport Academy Located along Kitengela Road, this sports academy never lacks holiday activities. The academy has tennis, swimming, rugby, basketball and soccer with beginner, intermediate and advance classes oﬀered. Charges are Sh3,000 per sport or activity per week with lunch provided for Sh1,500 per week as well. Camp dates; Week 3 starts on the 20th to 24th April and Week 4 starts on the 27th to 1st May. Accommodation is available at The Village charges are Sh1,850 per day or Sh12,500 per week with four people sharing a room or Sadili B&B charges are Sh2,800 a day or Sh38,000 for two weeks only with two people in a room. Don’t fret about having bored children in the house during the school holidays as there’s lots of activities to keep them busy and out of mischief.

Now that school holidays have come, it’s time to think about how to keep your children occupied in constructive activities so they don’t get distracted by so-called ‘bad inﬂuences’. You’re consistently told that children need to ‘relax their brains’ over the holiday; but really, what they need are opportunities to discover new dimensions of their creative potential, all the artistic energies they have inside which may not have been tapped during rigorous school hours. One of the best ways to make those ‘discoveries’ is by encouraging your children to go for fun classes that teach them to express themselves in any number of creative ways. They might like to go for classes in art, photography or even ﬁlm - courses that ideally should stimulate new skills, inspire new interests and open up whole new worlds for their young and inquisitive minds. One of the best local art teachers is possibly already known to your kids if they watch Saturday morning television. On Makutano Junction, Patrick Mukabi shows little people how to get totally involved with colours, shapes and do-it-yourself works of art. Patrick has real magic as an art teacher and has taught both in schools and in his studio for many years. During the holidays, he is offering tailor-made art classes to children from 5 years to 19 at his new Railway Museum ‘Depo’ Artist’s Studio next to the museum. There are several other places where children can have fun learning how to paint, draw and generally work with their hands, head and heart throughout the holidays. These include Kuona Trust where classes for children and adults will be available throughout the whole holiday period and Nairobi Art Centre in Lavington. There are several good things to be said about having your children take art classes at Kuona. One is that they will be meeting teachers there who are also practicing artists, meaning the children will get to see their teacher’s art work before and after class. Students will get to see the genuine joy that artists have in creating new works, be they paintings or sculptures or jewellery, woodcut prints or even installations. All the details about Kuona art classes are online both at Facebook and at the Kuona Trust Website. Undoubtedly, there are many more Kenyan artists teaching children privately over the holidays, so if you know any one of them, just know that many like Patrick Mukabi would be happy to come to teach your child the joys of artistic expression in the comfort of your own home. Some of Mukabi’s mentees at his studio. PHOTO MARGARETTA WA GACHERU

BDLIFE | Friday April 17, 2015

Friday April 17, 2015 | BDLIFE

BDLIFE: MAIN STORY

MAIN STORY: BDLIFE

SPORTS

MUSIC

Eager students at a Golf For Kids lesson.

ART

Dan Mwangi takes Marriagoretti Mbithi through Associated Board of the Royal School of Music examination pieces at the Kenya Conservatoire of Music in this File Photo

Patrick Mukabi, a holiday art tutor, with (l-r) John Aura, Zach Odhiambo, Dennis Wafula (partly hidden) and Prince Kirungu.

PHOTO/ FILE

PHOTO/ COURTESY

PHOTO MARGARETTA WA GACHERU

Keep kids busy du≥ing the holidays The≥e is a lot going on a≥ound the count≥y to keep child≥en active and away f≥om the TV o≥ compute≥ BY MWIKALI LATI

Kenya Conservatoire of Music

SPORTS

A tennis coach from Florida, Bill Murray, conducts a lesson at Sadili Oval. PHOTO/ FILE

Kusoma Tu Utamaduni Kids Camp at CITAM Woodley Located on Ngong Road, this kid’s day camp aims to teach children, aged between four and 14

WHERE TO TAKE CHILDREN Art classes around the city, Music at the Conservatoire or Wynton’s.

Holiday a≥t classes open up new ho≥izons fo≥ child≥en BY MARGARETTA WA GACHERU

You can also take them for tennis, football and golf and even swimming classes. There are also residential holiday camps

BDLIFE | Friday April 17, 2015

BDLIFE: GADGETS The≥e has been inc≥easing demand f≥om consume≥s fo≥ po≥table devices with supe≥io≥ sound

Po≥table speake≥ you can use with multiple devices BY DOREEN WAINAINAH

our phone, laptop and another of your mobile devices are connected to the same speaker, allowing you to switch your song selection from one device to another. That is the capability brought on board by the new LG Music Flow speakers launched in Nairobi last week. LG launched its Music Flow speakers in the Kenyan market with the portable P7 Bluetooth speakers that allow a user to connect up to three devices

The full range of LG Music ﬂow system includes Mini Audio Systems, Blu-ray home theater systems, soundbars, docking stations and the MusicFlow MultiRoom Wireless Speakers. COURTESY

simultaneously to it. “We are pleased to introduce our new Music Flow Bluetooth speakers to Kenyan consumers,” said Moses Marji, marketing general manager, LG Electronics East Africa. The tech giant announced the Music Flow brand last year and have expanded the available options with the P7 this year.

Sh17,995 Average retail price

Music everywhere The portable Bluetooth speaker was globally announced in January before its Kenyan debut. Music Flow P7 will retail at an average price of Sh17,995 and will be available in se- lect stores across the county in two weeks. “LG Music Flow will be continually developed to enhance both the indoor and outdoor experience of our customers so that eve-

ryone can enjoy the music they love, anywhere,” said Marji. The speakers are equipped with Auto Music Play and Multi-Point functions which allow the devices to connect with up to three Bluetooth devices at the same time and switch among them seamlessly.

Stereo They can be connected to a compatible LG TV for enriched sound via the TV sound sync function. One can also

during the previous hour. However, in the future, when next-generation ﬁtness bands capable of collecting a greater volume of more varied data appear on the market - the risk of sensitive medical data about the owner leaking out could rise signiﬁcantly.

Vibrates “An Android-based device running Android 4.3 or higher, with a special unauthorised app installed can pair with wristbands from certain vendors. To establish a connection, users need to confirm the pairing by pressing a button on their wristband. Attackers can easily overcome this, because most modern fitness wristbands have no screen. When the wristband vibrates asking its owner to confirm the pairing the victim has no way of knowing whether they are confirming a connection with their own device or someone else’s,” states the research Kaspersky Lab experts advise users of smart wristbands who are concerned about the security of their device to check with the wristband’s vendors whether such a

LG Music Flow P7 Portable Bluetooth Speaker Superior Sound Bluetooth Compatibility Dual speaker pairing TV Sound Sync

Surround The speaker has a 20W output making it ideal for small rooms and it can also be used as a second speaker in a stereo set-up to create a surround eﬀect. The speaker can connect to another P7 in addition to working on its own to utilise the Dual Play option. To accessorise the speakers, they come with a rubber surround band that comes in orange, red and green. It uses a micro USB for charging and provides users with the option of adjusting volume or skipping a track on the actual speaker.

The latest hype in the wea≥ables ma≥ket has been in fitness bands he devices have been used to track workout activity, manage calorie intake and improve health awareness. A research by Kaspersky Lab has, however, revealed that the devices may not be as secure as the owners would like us to believe. The devices store information on the owners, in some instances, even the location. This raises the need to secure the device to ensure that unwanted third parties do not log into the device. Kaspersky Lab researcher, Roman Unuchek, has examined how a number of fitness wristbands interact with a smartphone and discovered some surprising results. According to his research findings, the authentication method implemented in several popular smart wristbands allows a third-party to connect invisibly to the device, execute commands, and – in some cases – extract data held on the device. In the devices investigated, such data was limited to the amount of steps taken by the owner

FEATURES

get powerful stereo sound by connecting two speakers to a TV or smartphone through a Dual Play function. In addition, it has a continuous seven-hour battery life. According to Marji, there been an increase in consumer demand for portable devices with superior sound quality as the culture of outdoor entertainment takes root, especially within a growing Kenyan middle class.

potential attack vector would be possible on their product. However, there has been no data to show that the attackers can collect critical data like passwords or credit card numbers, as the devices are still very basic.

Information “The ﬁtness trackers currently available are still fairly basic, capable of counting steps and following sleep cycles, but little more than that. However, the second generation of such devices is almost here, and they will be able to gather much more information about users,” said Unuchek, Senior Malware Analyst at Kaspersky Lab. - DOREEN WAINAINAH

Friday April 17, 2015 | BDLIFE

BDLIFE: HEALTH

P≥epa≥ing you≥ child fo≥ the ﬂu season Babies unde≥ six months a≥e especially susceptible to its complications, but should not be given the vaccine Resist the urge to give antibiotics for ﬂu. FILE

BY DR MUKUHI NG’ANG’A

he cold, rainy season is with us again and once more, we are faced with the sniffles and coughs that are characteristic of the flu and common cold. Most of us have adopted a ‘wait and see if my child gets the flu then deal with it’ approach yet there are several things that one can do to help prevent your child from getting the flu.

Flu vaccine Flu vaccination is one of the most important ways of preventing this viral infection. It is particularly important for children, the elderly and those with weakened immune systems. That said, everyone should get an annual ﬂu shot. The best time to get it is in the beginning of the cold season (which in Kenya starts around April). Most urban private hospitals provide this vaccine but it is currently not part of the governmentfunded vaccination programme. Some private schools also oﬀer it as part of their annual health plan.

Hand washing This is the simplest yet most effective way to prevent colds and flu. When it is very cold, one is tempted not to repeatedly wash their child’s hands and it is not unusual to see a parent wipe a child’s dirty hands with a wet cloth before a meal or after visiting the toilet. This should be avoided as it is known to increase the incidence of disease in children. Hand washing is only effective if you use soap. In addition, you need to do

it for at least 60 seconds (not forgetting to rub in between ﬁngers and under the nails with each wash). To help a child eﬀectively wash their hand, get them into a routine of singing a short song which lasts roughly one minute (during which the child should have thoroughly cleaned their hands).

Water alternatives If you really do not want to use water all the time, there are various water alternatives available in our market. Hand sanitizers are alcohol-based solutions which are applied to the hands in an attempt to kill germs. However, in order for it to be eﬀective, it must have at least 60 per cent alcohol (so always read the label before buying it). Wet wipes (hand wipes) are also another alternative to water but they must never be re-used. Once you wipe your hands, the wet wipe carries those germs and can spread them around if recycled.

Paper towels Germs can be transferred from one surface to another, including towels. For this reason, where possible, use paper towels to wipe your child’s hands instead of a shared towel in the house. If you are concerned about using too much paper, consider getting each family member an individual hand towel instead.

ﬁrst layer of clothes helps to drain moisture or sweat (vest/ T-shirt). The second layer serves as insulation (shirt/dress/trouser/sweater), while a third outer layer can help to block out the cold (jacket/coat).

No antibiotics please! If your child gets a runny nose, sore throat and slight fever (all signs of flu), resist the urge to load the child up with antibiotics – they do not help! The flu is a virus not a bacteria and thus will run its course regardless of what you do. Giving your child antibiotics during this period only destroys the ‘good bacteria’ in their digestive system and does not cure the flu. If your child gets the flu, it should be treated with an anti-viral drug not an antibiotic.

Babies under six months Layer up Although you can dress your child up in whichever way you see ﬁt, health practitioners in countries that experience winter have developed a ‘3 layer guideline’ when dressing up your child for the cold. The

Babies under the age of six months are particularly vulnerable to the effects of the flu. In particular, they are susceptible to complications of the flu such as pneumonia, dehydration and even brain inflammation and death. The flu vaccine cannot be administered

to babies under the age of six months. For this reason, it is important that extra precaution be taken in families where there is an infant of this age. In such cases, all people who are in regular contact with the baby must get vaccinated (this means all family members and the nanny). No one should handle the baby or their toys/feeding equipment without washing their hands.

Good nutrition vs supplements There is a lot of research about various vitamins, minerals and herbs which have been thought to help prevent the flu. This includes vitamin C, zinc, mwarubaini (neem) and Echinacea (cone flower). Although these may offer some relief when sick, there is no evidence to prove that they can prevent the flu. For this reason, most nutritionist and paediatricians advice on giving your child a diet rich in fruits and dark green vegetables. A healthy diet helps boost your child’s immunity which means that if they do get exposed to the flu, they will be better equipped to deal with it.

BDLIFE | Friday April 17, 2015

BDLIFE: CULTURE AND THE ARTS MUSIC

Gogosimo band leade≥ ≥eleases new album BY BILL ODIDI

caught up with James Gogo as his band – Gogosimo - performed at the Hotel Intercontinental in Nairobi last Thursday evening. The band plays Soul, Jazz and African music every week and this is just one of five busy nights of gigs for them. “Monday and Tuesday are my only off-days from the live gigs and I spend these two days in the studio writing and recording music,” says Gogo with a laugh. “The rest of the week, I am performing with the band at different venues in the city.”

Repertoire Wednesday nights finds Gogosimo playing on the first floor Lounge of Villa Rosa Kempinski, Friday night at Chomazone on Mombasa Road and Saturday night at Klub House, Parklands. The band is back at Kempinski on Sunday for Brunch at the hotel’s Lucca Restaurant. “Our repertoire is diverse at all these venues, from Motown soul, salsa to rhumba and, of course, we play songs from the Gogosimo

albums and my own solo projects,” explains Gogo. The musicians, who play the different instruments in the band, are also vocalists so the group leader can step out of stage for a quick interview during the “Afro-Smoothie” night at the Intercontinental as the rest continue with the performance “You know, even the drummer and the saxophonist can sing so we just alternate on vocals during any performance,” says Gogo who says his band would never ever think of using playback. “We are strictly a live outfit.” Marcus James Jozee, to use his official name, is a multi-talented musician who learnt the saxophone from his father Ndongo Amani, a member of the legendary Congolese band Les Noirs that settled in Kenya in the 1970s.

Drums and piano He later picked up the drums and piano before starting his professional career in Mombasa with a brief spell in the Safari Sound Band along with his wife, the singer Susan Wanjiru in the late 90s. They both quit and relocated to

Nairobi to form Gogosimo in 2002. After three albums together with the band, Gogo released his debut solo album “Finding the Keys” in April 2014 which contains a strong coastal flavour with jazzy cover versions of songs originally recorded by some of his influences like Fundi Konde, Nyota Ndogo, Joseph Ngala and his former band Safari Sound Band. The album also had collaborations with Mercy Myra and Gogo’s long time friend and fellow Gogosimo band members perform at a private function saxophonist Isaiah Katumwa from Uganda. at the Villa Rosa Kempinski Hotel, Nairobi , in January . Last April, Katumwa was the guest per- CHARLES KAMAU former at the launch of “Finding the keys” and the two musicians will reunite again on new songs, the same number as that on his first stage at Kampala’s Serena Hotel on May 8 at album a year ago. an international show featuring South African He describes the new album as an exciting jazz veteran Hugh Masekela. venture because unlike his debut release that The much-anticipated concert is in cel- contained many guest vocalists, he sings alone ebration of Katumwa’s 20 years in the music on most of the tracks. Inevitably, there are a few collaborations, business. including one with Katumwa, and another with Collaborations Ugandan singer Rachel Namubiru. Gogosimo Gogo himself is also looking forward to the saxophonist Noah Fukwe also provides vocals release of his second solo album “A Step ahead” on the album. in June this year having completed another 14 Gogo is very eager for fans to check out the

ART

Local a≥tists now p≥otest against mis≥ep≥esentation Chinese and Italians have ≥epo≥tedly taken up Kenya’s space at this yea≥’s Venice Biennale BY MARGARETTA WA GACHERU

ith the Kenyan visual arts scene thriving as it is doing right now, it’s no wonder artists are up in arms over the idea that Chinese and Italians are supposedly representing them at this year’s Venice Biennale which runs from May to August.

Railway Museum’s new art studio. At both the Museum and Village Market, more than one exhibition is ongoing. For instance, at the National Museum there have been no less than three separate shows up simultaneously. Barclays’ Atelier show just came down, but over Easter, it displayed artworks of the six artists who won the Atelier competition

Semi-abstract

Exhibitions The Nairobi visual artists community is currently doing all they can to bring this cultural charade to a halt. Ideally, if their eﬀorts will not shut down the so-called ‘Kenya Pavilion’ altogether, they will at least get the Kenya name removed from the pavilion. Nonetheless, all the controversy has not dampened local artists’ creative expression as one can see all over the city where exhibitions are currently ongoing everywhere from the National Museum and Village Market to Banana Hill Gallery, Talisman and the Nairobi

Patrick Kinuthia’s ‘‘Pick-up matatu in Shags’’ at the Village Market

‘‘Butterﬂy on My Head’’ by Patrick Ng’ang’a at Talisman in Karen PHOTOS BY MARGARETTA WA GACHERU

It also included exceptional works by painters like Mbuthia Maina, Samuel Njuguna and Michael Soi as well as Paul Onditi, Leena Shah and Martin Onyis whose solo exhibition just opened at Que Pasa in Karen Before Atelier closed, the Creativity Gallery opened “Emergence’ a new exhibition of young artists, Manasses Miano, Reuben Andwate and Ron Enoch Lukes. Next door, Stephen Njenga’s one-man exhibition opened on the most spacious side of the Gallery. Njenga is a longstanding member of the Nairobi art world though he has been out of the mainstream for too long, which is one reason why the public needs to go see his intricate semi-abstract paintings. The show has a retrospective character

James Njoroge with his collage,Lamu seafront at the Village Market .

with his latest works being bright, colourful and luminous while his older works have dusky, earthen hues which are no less lovely though less captivating than his latest lightinfused artistry. Njenga is more accessible now that his studio has shifted to the new artists’ complex at the Railway Museum which he shares with several other extraordinary local artists. And right across the way, one of our leading local artists Patrick Mukabi just moved in at the former Railway Museum Art Gallery. Leaving the GoDown Art Centre where he’d not only painted but mentored a multitude of young artists (both local and international), Patrick has now spread his wings having wall space nearly suﬃcient to allow the public to see more of his own awesome artworks even as he continues to mentor aspiring artists.

Rural life Village Market also has more than one group exhibition ongoing concurrently. There’s ‘Shags’ featuring colourful portraits of rural life by Fred Abuga, Patrick Kinuthia and James Njoroge: three remarkable painters, each having a distinctive style. Njoroge creates striking collage art out of

Friday April 17, 2015 | BDLIFE

CULTURE AND THE ARTS: BDLIFE CULTURE GOGOSIMO LIVE Villa Rose Kempinski: Sunday brunch 12- 5 pm and Wednesday night at the Villa Rose Kempinski Hotel Intercontinental: Thursday 6.30 – 9.30 pm Chomazone, Mombasa Road: Friday 9 -12 pm Klub House Parklands: Saturday 8 – 11.30 pm

Gogosimo band leader James Gogo, whose ofﬁcial name is Marcus James Jozee, is a talented musician who learnt to play the saxophone from his father Ndongo Amani, a member of the legendary Congolese band Les Noirs that settled in Kenya in the 1970s. COURTESY BILLY ODIDI

ﬁrst single “Paukwa”, a driving funky beat with slick vocals and a super sax that has been uploaded on You Tube. “I have livened up the tempo just a little to create a semi-club sound so that the music can be played at a party but still retains a bit of the chilled out feel that allows you to tap your feet to the sound at home or in the car.”

Inspired He says that he was inspired to tweak the sound by listening to the critically-acclaimed 2005 recording of one of his idols, Stevie Wonder, “A Time to Love” Again, unlike his ﬁrst solo album that had cover versions of songs by the people who have

inspired his career, it’s almost as if he has now been freed up to deliver an original sound that is entirely his own. There has been plenty to learn for Gogo after performing at high proﬁle shows such as the Richard Bona concert at the 2014 Safaricom Jazz Festival, the Erykah Badu concert in 2012 and recording with Congolese rhumba legend Papa Wemba on the 2008 Gogosimo album. When we ask him how he distinguishes between his solo projects and the band, Gogo is emphatic: “Gogosimo is my band and I am the music director and the guys from the band also play for me as James Gogo so we are quite clear about the diﬀerent roles.

Wamagata’s ‘3D’ Coastal scene . PHOTO BY MARGARETTA WA GACHERU.

rural home. It’s also a mutual appreciation of natural light and its dazzling impact on the local landscape. Just above Shags is Transformations, an eclectic collection of seven painters and one sculptor who have little in common apart from their appreciation of the cause the show’s curator Lucy Ndungu is committed to, namely helping one of the most vulnerable groups in Kenyan society, teenage mothers.

Art Centre

shredded magazines; his current focus is on Lamu Island where he just completed an art residency. Abuga paints colourful portraits of Western Kenyan village life using broad vertical strokes infused with bright equatorial light; and Kinuthia magically blends colours and cultural contours to highlight soulful features of Central Kenya’s rural life. What the three share in this show is not only the common theme ‘Shags’, a Sheng word for one’s

A percentage of the sales from the show will go to Ms Ndungu’s NGO, Hope for Teenage Mothers, which is already helping teen mums in Nairobi slums acquire marketable skills like tailoring, cookery and entrepreneurship. Transformations also aﬀords the artists an opportunity to showcase their work. They include two Sudanese painters Yassir Ali and Fawaz Elsaid together with scrap metal sculptor Alex Wainaina whose metal ‘askaris’ stand all around Village Market having been commissioned several years ago. The other Kenyans include Martin Muhoro, John Ndungu, Eric Shitaka, E. Wamagata, and Peter Mwalavu. Finally, while the storm of protest against Italians and Chinese going to Venice supposedly representing Kenyan artists continues, Minister for Culture, Hassan Wario told the contingent of local artists who met him last week that he was hopeful a state-of-the-art Kenyan Art Centre would soon be built next door to the newly renovated Kenya National Theatre. However, he didn’t specify when the ground-breaking would take place.

Explosion of aﬄuence at Indian fashion show Designer Nitya Arora displays some of her jewellery at the show.

BY MWIKALI LATI

rowded, both in racks of clothes and people, in a ballroom at the ﬁve-star Villa Rosa Kempinski, Indian designers from some of the leading cities when it comes to Indian fashion were exhibiting. From Dubai, Mumbai, Delhi, Lucknow, Kolkata, Hyderabad to Lahore, the clothes and jewellery were an explosion of aﬄuence; in design and price tag. Modern gowns sewn with real pearls and colourful and gleaming traditional Indian wear - saris, salwar, lehenga and kurta – was the common denominator in that room. The rich gold encrusted with precious and semi-precious stone jewellery that was not shy in size and intricate designs.

Traditional look “Indian fashion is all about keeping the traditional look through different generations by twisting it with modern and some western inspirations. Keeping the body covered in style and still revealing just a bit of your feminine curves,” says Vaishali Morjaria, one of the leading Kenyan designers who does evening and wedding gowns. Indian fashion has aesthetic cuts and colours though most designers today weave some modern designs into the traditional. Inspiration comes from various Indian village art and craft, fabrics like silk, colours, lifestyle and traditional cultural values and aesthetics from Gujarat, Rajesthan, Punjab and so on. Vaishali adds that even as the modern clothes continue to be a favourite during the day, during cultural occasions or prayers women wear sarees or other cultural dresses. Priyanka Shenoy, the designer of Tevar - one of the exhibitors from Mumbai, said that Indians like to show off how much they can spend on an outfit during occasions.

Embroidery She had dressed one of her mannequins in a choli (mid-riff baring top with a wide flowing skirt) the top had traditional Indian hand-embroidery of zardosi in gold. “Embroidery transforms plain fabrics to look beautiful and rich and therefore most Indian fashion designers hold embroidery close to their hearts. The value of the outfit is determined by how intricate, the embroidery work is on the outfit,” says Vaishali. When it comes to embroidery, Shenu Hooda, a local fashion designer has decided to make it her focus. Her workshop, based in Pakistan, uses traditional embroidery techniques.

Mumbai designer Priyanka Shenoy’s wedding Choli worn by brides . PHOTOS BY SALATON NJAU

“I come f≥om No≥th India; the land of maha≥ajas, queens and kings. Jewelle≥y is pa≥t of the life and cultu≥e. Big is beautiful. I feel like small jewelle≥y gets lost. My jewelle≥y is about pe≥sonality,” Nitya Arora, FASHION DESIGNER.

Designer Nitya Arora displays her jewellery at the fashion exhibition in Nairobi. A heavily embroidered piece can take four to five days to complete. The jewellery is no different; it does not shy away from being large or having lots of glitter. That is for both the traditional and costume jewellery. At the entrance of exhibition was Valliyan – a costume jewellery Indian brand from Mumbai. On the table were large pieces of jewellery using precious and semi-precious stones and gold plated with 18k gold. Designs influenced by animals, architecture and the designer’s travels. “I come from the North India; the land of maharajas, queens and kings. Jewellery is part of the life and culture. Big is beautiful. I feel like small jewellery gets lost. My jewellery is about personality,” says Nitya, the designer. mwikalilati@gmail.com

BDLIFE | Friday April 17, 2015

BDLIFE: EAT OUT Afte≥ seve≥al glasses of wine, we all found the evening ‘winetastic’

Nede≥bu≥g’s delicious wine pai≥ing dinne≥ BY WENDY WATTA

’m not a stickler for wine and food pairing and my penchant for accompanying heavily seasoned red meat with zippy wines like Sauvignon Blanc has caused many a sommelier to cringe. I do, however, like to be armed with knowledge about these things as you never know what may come in handy when chanced with an appropriate occasion. It is no wonder then that I headed out to Que Pasa Restaurant in Karen for an evening sampling good food and wine; or for-as one stranger seated across from me at the table would state after one too many glasses of Baronne -”an evening being asked if you can smell the watermelon in your wine when all you want to do is drink it!”

We arrived to ﬁnd Nederburg’s Brand Manager- Kelvin Wanjira already walking guests through the appetizer whose accompanying wine was the Nederburg Lyric. Next up was the starter: a crispy Crab with Fennel Salad and Leek Puree that instantly had me crafting a love song in my head. It was paired with the very rich Nederburg Winemaster’s Reserve Chardonnay.

Sommelier Que Pasa’s in-house sommelier, Lucy Nduma, explained that the choice of this white wine was to dissolve the overwhelming smell of the crab. While I deﬁnitely heard some murmurs of approval go round the room as one sip after the other was taken, I found the pairing a tad too

DRINK

Chilling with Jäge≥meiste≥ Since its inception in Germany more than 80 years ago, Jägermeister - an aromatic herbal liqueur - has quickly become a leader among its competitors. We sat down with Marketing Manager for the Middle East and Africa, Thomas Männel, to speak about their recent partnership with Viva Global.

The food that was on offer at Que Pasa Restaurant dinner in Karen.. PHOTOS COURTESY EAT OUT

overwhelming. Que Pasa’s head chef Anthony Kimani hit the spot yet again with the main course: Pan-seared Spring Duck with Root Vegetables, Lime Emulsion and Wilted Mushrooms. This was paired with the heavy, bold and masculine Baronne - a very beﬁtting partnership I must say. My favourite wine was, however, Stein from their Foundation range. It is a blended white wine that is light, fruity and oddly made me think of pop music! Very up my palate’s lane. It accompanied the dessert: a Green Tea and Milk Flan with Raspberry Samosa, Cardamom and Orange Crumble and Horseradish Ice Cream.

Kelvin explained that their aim was to achieve varietal appreciation of one of Africa’s most awarded brands of wine. Chef Anthony’s dad was in attendance. There were hugs between the two as we were told that this was actually his first time sampling his son’s menu at the restaurant. The talented chef shed a tear or two as his father expressed his pride. It was truly beautiful. I guess after that many glasses of wine, I would find beauty in anything. After that, a fun trivia session ensued where the winner got to walk away with a five litre bottle of Nederburg Cabernet Sauvignon. Overall, the evening was winetastic.

Can you tell us some of the main ingredients in Jägermeister? Jägermeister is based on a secret recipe with 56 natural ingredients consisting of selected herbs, blossoms, roots and fruits from across the world. Among them are star anise, cinnamon and ginger roots as well as a set of top secret herbs that create that distinct herbal ﬂavour when combined.

What’s your main objective during your time in Kenya? Many people know of Jägermeister but don’t really understand what the product represents or how to enjoy its rich ﬂavour. Bartenders are an important part of that equation so my main objective has been to train local bar staff.

How receptive have our local outlets been to your training? The bartenders in Nairobi have been incredibly responsive and were especially impressed by the introduction of our Jägermeister tap machines. They chill and dispense the herbal liqueur at temperatures of minus 18 degrees Celsius.

Delectable food at Ca≥amel lounge BY DOREEN WAINAINAH

aramel Restaurant and Lounge came into the country last year and immediately got an infamous tag for its rumoured high costs and exclusive clientele, a reputation that may not be very correct. As we settle in the restaurant at the long table, a high profile cabinet secretary is walking out with security personnel in tow, a testament of the type of clientelle the second floor outfit attracts. If you are expecting caramel desserts at the Caramel Lounge, think again. The brown hues in the interior would probably be the only inference between the restaurant and its name. Founded in 2009, the Caramel Group set up its first restaurant in Nairobi last year at ABC Place, adding to the ones in Dubai and Abu Dhabi. Caramel Nairobi offers an intimate dim-lit setting with low ceilings ideal for a date, meeting or just an after work rendezvouz. The signature Onyx table sits next to the bar and a door away from the cognac and cigar room, a popular hangout for gentlemen who wish to sip slowly at expensive cognac as they puff away at their cigars. It is in the cigar lounge that patrons can enjoy the Remy Martin Louis XIII which goes for Sh1.25 million a bottle. Meals at the eatery range from Sh800 to Sh2,600 for shared table

dishes. These come in several portions that can be for three or four people. Salads cost between Sh950 and Sh1,800, mains go for Sh1,600 to Sh3,500 and dessert for Sh650 to Sh880. A side dish of French fries goes for Sh750. Signature cocktails go for Sh950 The terrace which also serves as the smoking area for the restaurant has a more airy feel and better acoustics than the main dining area, probably because of the windows and ‘open’ setting.

American classics The menu, according to Giles Pattison, the general manager, borrows from American classics, similar to those in Vegas, with a twist to them. For starters, we have the Mac and Cheese, TNT Shrimp and Signature Chicken Lollipops. The Mac and Cheese is not the ordinary messy blob of pasta on a plate, it resembles fish fingers instead. Made with three cheeses, parmesan, cheddar and mozzarella, all from Brown’s, it is served in four sticks, evenly cut, breaded and fried and a dip with some truffle oil to add to the elegance of the usually not-so-elegant dish. The chicken lollipops are served buffalo style coated in Frank’s Hot Sauce, which is American, and a blue cheese dip. TNT Shrimp which, according to our hosts, is a popular classic, is shrimp coated in spicy Japanese mayo

So how best can one enjoy Jägermeister’s rich ﬂavour? Jägermeister is best enjoyed as an ice cold shot, especially when served in a frosted shot glass. It’s incredibly versatile though, with ﬂavour components that lend themselves to great combinations.

A serving of petite beef sliders with aged cheddar, balsalmic red onion and a side of fries (left). General manager Giles Pattison (right).. DIANA NGILA

and served in a large cocktail glass. The shrimp goes for Sh2,600 and can be shared between four people.

Palate “We source all we can locally. The Cheese is from Brown’s in Limuru, bread from Ennsvalley, chicken from Kenchic and aged beef from Morendat in Naivasha,” says Giles. For the mains, there is a selection of grilled chicken, petite beef sliders and pomme frittes. The chicken comes with a delectable parsnip puree, which, is the star of the dish, at least according to my palate as well as one of the other journalists at the table. She enjoys it so much that she tries to coax the recipe from Giles. A plate of marinated grilled chicken with baby spinach and parsnip puree goes for Sh2,100.

In simple terms, the petite beef sliders are just mini burgers, with juicy and flavourful aged beef from Morendat, with a pickle and red onions and aged cheddar. A meal that our photographer cannot seem to get enough of. The sliders, served as a trio cost Sh1,900. The garlic coated fries with grated parmesan are crispy on the exterior and soft on the inside, offering the starch for the meal. They come served in a bucket for easy sharing. Dessert is a Baked Alaska, Sh880, which, unless you have an extra sweet tooth, may be a little high on the sugar content due to the torched meringue but a very refreshing filling of fresh strawberries and ice cream. And for chocolate lovers, there is a gooey dark chocolate fondant with a cappuccino ice cream at Sh880.

Finally, what do you ﬁnd to be most exciting about Jägermeister’s expansion in Kenya? There is such great potential here and fantastic venues popping up every month. I look forward seeing what we can bring to the local night scene.

Jagermeister marketing manager for Middle East and Africa, Thomas Mannel. COURTESY

Friday April 17, 2015 | BDLIFE

BDLIFE: MIND GAMES QUICK CROSSWORD

1304

SUDOKU

234

WORD WHEEL

Insert the missing letter to complete an eight-letter word reading clockwise or anti-clockwise.

Across 1 Objective (4) 4 Sumptuous (2,4) 7 Consumption (3) 9 Monarch (4) 10 Authorised (8) 11 Mousse (3) 12 Prima donna (4) 13 Be idle (8) 16 University student (13) 19 Send once (anag.) (8) 23 Wan (4) 24 Suitable (3) 25 Red alone (anag.) (8) 26 Looked at (4) 27 Be prone (3) 28 Justly (6) 29 Proboscis (4) Down 2 Public surveys (7,5) 3 Bags (7) 4 Dingles (5) 5 Sports fabric (5) 6 Inert gas (5) 8 Abstainers (12) 14 Goes off (5) 15 Deity (3) 17 Regret (3) 18 Lots (of) (7) 20 Play (5) 21 Lowest point (5) 22 Ahead of time (5)

CODEWORD

3180

Each number in our Codeword grid represents a different letter of the alphabet. For example, if 18 represents “C,” ﬁll in C every time the ﬁgure 18 appears. You have two letters in the control grid to start you off. Enter them in the appropriate squares in the main grid, then use your

TIMES CROSSWORD

knowledge of words to work out which letters should go in the missing squares. As you get the letters, ﬁll in other squares with the same number in the main grid and control grid. Check off the list of alphabetical letters as you identify them. SOLUTION appears in Business Daily on Monday.

24,046

WORD BUILDER

528

How many words of three or more letters, including plurals, can you make from the ﬁve letters, using each letter only once? No foreign words or ones beginning with a capital are allowed. There’s at least one ﬁve-letter word. Good = 16; Excellent = 22; Amazing = 29

Across 1 Round head of moor is jolly high (4) 3 Back crazy request to girl for source of attar (6,4) 9 There’s something lacking if edict has to be put out (7) 11 Richard’s opponent’s condition after light lunch? (7) 12 Markings on bat from China? (6,7) 14 Host makes way into garden (5) 15 Event in Irish town

0514

unﬁnished after a month (9) 17 Fail in court to secure title at ﬁrst, so decline socially (4,5) 19 Boy wearing cap and cape lying in the sand (5) 21 Married, keep losing head — shame! (13) 24 Add impurities to cement after cut-back (7) 25 Further bird that talks back to golden eagles’ leader (3,4) 26 Finishes, having surpassed such a line — no sense going on (3-7)

27 Scotsman chosen to speak (4)

Down 1 Try to rise twice, and fall (2,8) 2 One warming hands, old ears (alternately) — and neck (7) 4 The exact opposite, as pointed out (9) 5 Advantage of hound not evident at ﬁrst (5) 6 A Life of the Marches is very dark, lit badly (8,5) 7 Book the First, for One (7) 8 Seabird sailors shot

through middle of feet (4) 10 Sort of TV of course that’s not working (6,7) 13 Committal having alien finally confined (10) 16 Round stone is to produce rattle (9) 18 Said more than enough for fine, being tried (7) 20 Capital Spaniard raised, expending energy for nothing (7) 22 Cooler at height, so get coat (3,2) 23 Weapon locked up by keeper (4)

TRIO

512

These four words can be completed using the same three-letter sequence. Can you ﬁnd it?

YESTERDAY’S SOLUTIONS SOLUTION FOR TIMES CROSSWORD AT LEFT YESTERDAY’S SUDOKU AT RIGHT SOLUTIONS FOR QUICK CROSSWORD. WORD WHEEL, CODEWORD, WORD BUILDER AND TRIO WILL APPEAR IN BUSINESS DAILY ON MONDAY

BDLIFE | Friday April 17, 2015

BDLIFE: WEEKLY PLANNER WHAT’S ON THIS WEEK Art Fringe Churches in the Periphery of Seoul: Kuona Trust, until April 19th. This documentary work represents an inquiry into the religious, cultural and ﬁnancial dynamics of non-traditional churches located in the periphery of Seoul. The Staircase Showcase: Creatives Garage, until April 24th. Creatives Garage presents The Staircase Showcase featuring Kezia Nduta. Exhibition: Rosemary Ahono & Mike Kyalo: Karen Country Club, until May 3rd. Members and guest are invited to an artist meet and greet on Sat. 18th april 2015 2pm at the Cocktail Lounge in Karen Country Club.

Theatre Don’t Let Me Go: Alliance Française, Nairobi, until April 19th. In this hilarious comedy of riotous marital misunderstandings, a couple attempts to ﬂee the country. A Circus Production: Dreams: Sarakasi Dome, April 22nd. The second edition of the bi-monthly VIP nights is here. The Creative Team would like to present Dreams, a tantalizing circus production featuring the best of Sarakasi’s talent. Open Mic Nite: The Blues Restaurant, Fridays. Every Friday night there is an awesome Open Mic Nite at Blues Bar, Hurlingham…it’s a lot of fun. Also eat cheap burgers, ribs and Tusker.

Dance Afro Salsa & Cha Cha Cha Ladies Styling Workshop: Italian Institute of Culture, April 18th. Afro salsa and cha cha cha ladies styling dance. Tero Saarinen Company Kenya Dance Auditions: The GoDown Arts Centre, April 21st. Internationally renowned choreographer Tero Saarinen (Finland) is looking for dancers for a new creation. Rehearsals and performances will take place in Nairobi in November-December 2015. Capoeira Angola Classes: Y.M.C.A Kenya - Central Branch, Every Monday and Wednesday. Capoeira Angola can be described as a martial art, dance and a cultural weapon. It’s a beautiful game played to the rhythm of percussion instruments and call response songs and a philosophy. Zumba Fitness: Sarabi Pool and Supper Club, Saturdays. Sankara Nairobi presents a zumba ﬁtness experience to remember with PJ every alternate Saturday. Hip Hop Dance Classes: ABC Place, Wednesdays. Come learn the latest moves from your favorite music videos from an instructor who used to dance with a professional hip

Movie Premier of the Week RUN ALL NIGHT Mobster and hit man Jimmy Conlon has one night to ﬁgure out where his loyalties lie: with his estranged son, Mike, whose life is in danger, or his longtime best friend, mob boss Shawn Maguire, who wants Mike to pay for the death of his own son. Genre: Action, Crime, Drama Cast: Liam Neeson, Ed Harris, Joel Kinnaman, Boyd Holbrook

hop dance crew in Los Angeles and Chicago. Zumba with Magic Mike: The Oshwal Sports Complex, Wednesdays. Join Magic Mike for the most exhilarating workout of your life! Zumba Fitness is a Latin-inspired dance workout that will help you to party yourself into shape. Afro-Dance Workshop: The Theatre Company, Thursdays. Come learn African and Afro-diasporic (dances that have African inﬂuence found in other countries, such as Brazil, Colombia, Cuba, and Haiti) movement and rhythms every Thursday.

Festivals/Craft Fairs The Nairobi Cultural Festival: Nairobi National Museum, April 19th. The Nairobi cultural Festival theme being World Heritage - World Unity. High Court Grounds Maasai Market: High Court Grounds, Wednesdays. Taking place across various locations in Nairobi, the Maasai Market is vibrant and the place to get beautiful sculptures, shoes, jewellery, clothes and a huge selection of other Kenyan crafts. The Crafts Market: City Mall, Mombasa, Wednesdays & Thursdays. Buy creative craft items every Wednesday and Thursday at City Mall’s main parking area.

Hot Event of the Week Soysambu Event: Soysambu Conservancy, April 17th. A ﬁne display of horsemanship will be on show with dressage, cross country and show jumping. Lots of fun ﬁlled activities for all – camping, catering and an open bar.

Nightlife Ultralife Festival: Nairobi Arboretum, April 23rd. We took the trouble of hiring a team of scientists whose work was to study a speciﬁc species, the party animals. Danger’s Trio: Tamambo Village Market, Fridays. Come and enjoy our lineup of quality music at the

The Junction Musical Maasai Market: 3rd ﬂoor parking, the Junction, Thursdays. For a wonderful selection of arts and crafts, wooden carvings and beadwork.

Expositions 21st Kenya Home Expo: Kenyatta International Conference Centre, April 16th. The Kenya Homes Expo gives exhibitors a chance to make quick sales while buyers get good bargains. X-Treme Expo 2015: Hillcrest Secondary School, April 18th. The X-Treme Expo once more provides a unique opportunity for businesses involved in the active equipment, outdoor travel and adventure industries.

Music Frank Koine: Acoustic Boulevard: Michael Joseph Centre, April 18th. Featuring music from my album, amazing opening acts and much more at the iconic Michael Joseph Centre. King Mika Singh & Kanika Kapoor: Carnivore Restaurant, April 18th. This April at Carnivore Grounds with Mika Singh and Kanika Kapoor! Thursday Nite Live featuring Leo Mkanyia from Dar es Salaam: Choices Pub and Restaurant, April 23rd. We are proud to feature Leo Mkanyia from Tanzania as part of the East Africa Music Xchange in collaboration with Live at the Elephant and The GoDown Gig. Danger ’s C r e w : Tamambo Village Market, every Friday. Tamambo village

Tamambo Village market. Time Flight: Choices Pub and Restaurant, every Wednesday. Dj’s Maurice and King George are in the house tonight taking us back in his on the Time Flight with the best of Soul and Old skool music. Sunday School

market presents Danger’s crew every Friday. Fiﬁ Moto & Enomizizi With Kiunoviuno Band: Club Rumourz, Thursdays. Fiﬁ Moto, Enomizizi and Kiunoviuno band join us at Club Rumourz every Thursday for chakacha/ belly dancing.

Sports H&A Watamu Triathlon 2015: Watamu Turtle Bay Beach Club, April 18th. The 2015 Kenya national triathlon calendar is set to kick off with the Annual H&A Watamu Triathlon on 18th and 19th April in Kiliﬁ County. Bumblebee Tennis: Public Service Club, every Saturday. Bumblebee Sports is an organization that seeks to empower kids through sports and developing their sporting abilities. Detour Golf Classes: Royal Golf Course, every Saturday. Learn how to play golf in a fun interactive environment. Hockey Wednesdays: The Panari Hotel, every Wednesday. Fun ice hockey games.

Kids Events SuperCamp Kids Holiday Program: Savage Wilderness Camp, until April 17th. What’s your child doing this holiday? SuperCamp is a highly engaging holiday enrichment program that inspires and empowers students to excel. Parents Workshop: The Miraculous Brain: Peak Performance International, April 17th-18th. We shall be hosting parents with children between 5-12 years for a Free 2 hour Parents Workshop. We shall be focusing on Brain Development and its impact in revolutionizing the way children learn. Kusoma Tu Utamaduni Kids Camp: CITAM Woodley, until April 24th. Looking for a holiday activity for your child? Kusoma Tu has just what you are looking for. Art Parties In Secret Garden: The Nairobi Art Centre, daily. Get your own Arty Party or art workshop for a minimum of 8 people. Easter Avatar Art Workshop: The Nairobi Art Centre, until May 1st. The workshop is designed to introduce children to the world of Art & Crafts in relaxed and informal environment.

Food/Wine Let’s All Go Cuckoos: Simba Saloon,

with Dj Alpha: Brew Bistro and Lounge, every Sunday. The beer is on tap, the wings are wild. So many different sauces, bottoms up. Rockers Wednesday Reggae: Johnnie Bar & Lounge, every Wednesday. Rockers Reggae Live; By Gheto Radio Crew.

every Tuesday evening in conjunction with Kenchic, enjoy all you can eat chicken. Champagne & Oysters: Tamarind Mombasa. Champagne & Oysters every Sunday at the Clifftop Terrace. Cocktails Thursday: dusitD2 Nairobi, every Thursday. Come and try some of our uniquely created cocktails from the most exciting cocktail menu in the city. Pizza and Peroni Saturdays: Villa Rosa Kempinski, every Saturday. It’s not a one pizza, two pizza go home kind of thing. This is an all you can eat pizza affair. Great Deals: Best Western Premier Nairobi. Enjoy great deals everyday on Corporate events, socials, cocktails.

Special Events Open House: Jadia Creations: Loresho Springs Apartments, April 18th. We have lots of new inventory we would love for you to see. New clients will receive 10% off orders and readymade garments. Open Qorner With Tazim Elkington 2015: dusitD2 Nairobi, April 22nd. Are you ready to get out of your comfort zones? Join us at this unique gathering of ‘different minds’ where we pick and discuss a random question/topic written by participants. #CGchillout: Creatives Garage, every Friday. After a long week of creating and bringing your ideas to life, you certainly need a break from it all.

Yoga Afro Sync: Distant Relatives Ecolodge & Backpackers, April 17th. Mackinlay is back again, this time presenting for the very first time in Kilifi: AfroSync Band Kenya from Nairobi Mommy & Me Yoga Tuesdays: Ayatana Yoga Lounge, every Tuesday. Mommy & Me is a fun way to reconnect with your body while enjoying time with your baby. Outdoor Yoga Thursdays: The Hub East Africa, every Thursday. Getting fit with Zamasimba

Film L’amour Est un Crime Parfait: Alliance Française, Nairobi, April 20th. Marc, a literature lecturer at the University of Lausanne has a reputation for ﬂings with his female students. License To Kill: Benga House-Kyuna Crescent, until May 16th. A ﬁlm series inspired by the idea that individuals have the right to take charge of their life to improve their community and society for a better place.

For the most comprehensive event information in Kenya: www.kenyabuzz.com Tel: 0727 288 036

Friday April 17, 2015 | BUSINESS DAILY

YOUR FREE COPY

Friday, 17th April, 2015

Managing fo≥ t≥iple bottomline

BUSINESS DAILY | Friday April 17, 2015

Investing beyond the profit motive Triple line management benefits from growing realisation that long-term success depends on how smartly firms invest in societies they are in

Safaricom walks the untrodden path of fraud reporting Chief executive Bob Collymore says the move has made staff more conscious of the impact of their actions on business

Wanted: Better driving habits to stop pollution VICTOR JUMA explores motorists and regulators are responding to increased trafﬁc jams that are costing transporters and households billions of shillings in higher fuel consumption, lost man hours and increased carbon emissions

Water conservation: The jewel of corporate responsibility race UN’s Human Development Report estimates that rapid population growth and climate change will see half of the world living in areas with high water stress by 2030

Big businesses cut costs with better use of water Corporations say that though the initial investment in water harvesting technology may be high, long term beneﬁts far outstrip the initial pain

Smart ﬁrms lean on technology to cut energy consumption Safaricom says selection of machines that use less power helped it reduce electricity consumption even as it expanded its footprint

20 Compassionate employers harvest the fruits of healthy, happy workers Research shows that whereas investing in the social, physical and mental health of employees may not yield immediate tangible results, it is worthwhile in the long run

Chief Executive Ofﬁcer Linus Gitahi Acting Editorial Director Tom Mshindi Group Managing Editor Mutuma Mathiu Managing Editor Ochieng Rapuro Senior Graphic Designer Gennevieve Nahinga Graphic Designer Chrispus Bargorett Photo Editor Joan Pereruan Illustrations Stansalus Manthi

Eve≥y p≥ofession bea≥s the ≥esponsibility to unde≥stand the ci≥cumstances that enable its existence.” Robe≥t Gutman

Fo≥ests and meat animals compete fo≥ the same land. The p≥odigious appetite of the aﬄuent nations fo≥ meat means that ag≥ibusiness can pay mo≥e than those who want to p≥ese≥ve o≥ ≥esto≥e the fo≥est. We a≥e, quite lite≥ally, gambling with the futu≥e of ou≥ planet – fo≥ the sake of hambu≥ge≥s” Pete≥ Singe≥

People ‘ove≥p≥oduce’ pollution because they a≥e not paying fo≥ the costs of dealing with it.” Ha-Joon Chang, 23 Things They Don’t Tell You About Capitalism

We need to defend the inte≥ests of those whom we’ve neve≥ met and neve≥ will.” Jeﬀ≥ey D. Sachs

Alas, ou≥ technology has ma≥ched ahead of ou≥ spi≥itual and social evolution, making us, f≥ankly, a dange≥ous people.” Steven M. G≥ee≥

THE NUMBERS

In this issue

QUOTABLE QUOTES

the edge: Managing for triple bottomline

Top co≥po≥ations while managing f

III

the edge: Managing for triple bottomline

The≥e’s only one co≥ne≥ of the unive≥se you can be ce≥tain of imp≥oving, and that’s you≥ own self. So you have to begin the≥e, not outside, not on othe≥ people. That comes afte≥wa≥d, when you’ve wo≥ked on you≥ own co≥ne≥. Aldous Huxley, Time Must Have a Stop

You can neve≥ have an impact on society if you have not changed you≥self. Nelson Mandela

[We] a≥e the make≥s of ou≥ own state and…individuals who ≥ealize the fact need not, ought not, to wait fo≥ collective action. Mahatma Gandhi, The Essential Gandhi

He who cannot change the ve≥y fab≥ic of his thought will neve≥ be able to change ≥eality. Anwa≥ Sadat

Management is doing things ≥ight; leade≥ship is doing the ≥ight things. Pete≥ F. D≥ucke≥

Don’t tell people how to do things, tell them what to do and let them su≥p≥ise you with thei≥ ≥esults. Geo≥ge S. Patton

FROM THE EDITOR

keep p≥oﬁts on t≥ack fo≥ long te≥m success

Friday April 17, 2015 | BUSINESS DAILY

Why capitalism must confront the problem of sustainability Capitalism has always had a problem of sustainability. Somewhere in the whole profit motive, there was clearly a failure factor, as the lifespan of companies grew steadily shorter - now globally at an average of some 12 years. The world’s largest companies moved to near complete replacement with new stars in every two decades; environmental and social impact ratcheted up; and problems of staff retention, job hopping and client hopping climbed too. This has seen brand loyalty emerge as an essential for businesses that want to keep thriving and growing, but brand loyalty, it turns out, rests on more than companies making profits out of the buyers they wish to be loyal. Consumers need to see that the brand is a positive force in order to be genuinely loyal to it. But as well as producing better sales and profits, responsible business, it turns out, is also more cost effective. It may have taken decades for companies to come out of the closet of Corporate Social Responsibility schemes that make donations to charities, but sustainable business in 2015 has moved right into the business operations, spanning every corner from slashing fuel use by having delivery drivers turn off idling engines, to giving staff support that means they stay and truly engage, rather than departing and triggering costly recruitment process and retraining. In this edition of the Edge, we take a broad sweep across the different emerging facets of sustainable business. We unpick the slowdown in electricity spending by Safaricom, even as it quadrupled its number of base stations. We look at green buildings, which not only save money but increase staff productivity. We cover the benefits being enjoyed by employers from investing in healthier staff, and safer staff. We look at the moves to clamp down on fraud and corruption and the costs to businesses of not doing so. As we have investigated and reported on this array of resource saving, social engagement and a new emphasis on activities such as Hewlett Packard’s recycling of electronic waste creating now 400 jobs, as well as the studies that show the straight line impact in improved profitability, it’s hard to imagine the case, any more, for making business wastefully and anti-social. We’re sure there may be those who still do. But for the businesses that will now live across the 21st century, instead of only during its first quarter, sustainability has become as key as wealth creation. And long live that! OCHIENG RAPURO JENNY LUESBY MANAGING EDITOR CONSULTING EDITOR

BUSINESS DAILY | Friday April 17, 2015

the edge: Managing for triple bottomline

Sustainabilitydriven innovators also bring a strong execution focus to their efforts, are much more likely to place customers at the centre and work closely with many stakeholders, and drive sustainability objectives through skillful organisational change. FILE

Investing beyond the p≥ofit motive Triple line management benefits from growing realisation that long-term success depends on how smartly firms invest in societies that host them BY BOB KOIGI

ompanies world over are reporting rising profits and improved shareholder, employee and stakeholder relations thanks to sustainability reporting, which sees companies benchmark their performance beyond financials to include their social and environmental impact. These companies have understood that long-term profit and success depend on how smartly they invest in the society they are a part of and the environment that sustains them. According to a 2011 survey on corporate reputation, expanding transparency and reporting positive deeds were the two most important ways to build public trust in business. The 2013 Boston College Centre for Corporate Citizenship and Ernst & Young survey revealed that more than 50 per cent of respondents issuing sustainability reports said those reports helped improve the firm’s reputation. Another 2011 survey, conducted by Ernst & Young

and GreenBiz, found that employees were a vital audience for sustainability reporting, with 18 per cent of respondents citing employees as a report’s primary audience. More than 30 per cent of respondents in the 2013 Boston College Centre for Corporate Citizenship and EY survey likewise saw increased employee loyalty as a result of issuing a report. In addition, companies reporting increased proﬁts as a result of their sustainability eﬀorts rose 23 per cent last year, to 37 per cent of the total, according to a new global study by the MIT Sloan Management Review and The Boston Consulting Group (BCG). The study, based on a survey of 2,600 executives and managers from companies around the world, also found that nearly half of respondents said their companies had changed their business model as a result of sustainability opportunities, a 20 per cent jump over the previous year. The report calls these companies that have made business-model innovations: “Sustainability-Driven Innovators.” Interestingly, the study found that companies in

emerging markets change their business models as a result of sustainability at a far higher rate than those based in North America, which has the lowest rate of sustainability-driven business-model innovation and the fewest business-model innovators. “Sustainability-Driven Innovators see the opportunity differently than do companies that haven’t gleaned sustainability’s financial rewards,” explained David Kiron, executive editor at MIT SMR and a coauthor of the report. “They don’t dwell on it as a cost issue. They focus on how their efforts can increase market share, boost energy efficiency, and build competitive advantage.” Sustainability-Driven Innovators also bring a strong execution focus to their efforts, are much more likely to place customers at the centre and work closely with many stakeholders, and drive sustainability objectives through skilful organisational change, Kiron said. The extent to which a company incorporates sustainability concerns into its business model also correlates with its increase in profit, the study found. For example, 50 per cent of survey respondents who had changed three or four business model elements said they profited from their sustainability activities, compared with only 37 per cent of those who had changed only one element of their business model. When innovations to both target segments and value-chain processes were among the three or four business-model changes, the percentage of respondents who said sustainability added profits climbed from 50 per cent to nearly 60 per cent.

Friday April 17, 2015 | BUSINESS DAILY

More than 60 per cent of respondents at companies that had changed their business model and had sustainability as a permanent fixture on their management agenda said they have added profit from sustainability. In measuring sustainability, two indices are frequently used world over to measure companies’ responsiveness to social and environmental factors surrounding them. The Global Reporting Initiative (GRI) offers the world’s only international reporting standard across a widening range of categories and criteria, including performance in respecting ‘freedom of association’ rights and supplier human rights assessments. By focusing on the four key areas of sustainability – economic, environmental, social and governance performance – the GRI aims to make sustainability reporting by all organizations routine and as comparable as financial reporting. This process helps companies by providing them a functional framework that they can use to develop their own sustainability reporting initiatives, helping them to “set goals, measure performance, and manage change”, according to the GRI mission statement. Most Kenyan companies use this method in their sustainability reports. The second framework is the United Nations Global Compact, which has ten principles that guide companies in their reporting, including human rights, labour, environment and anti corruption. The initiative spans 145 countries, 36 from Africa, Kenya included.

“Sustainability has gained t≥action as businesses ≥ealise that ethical p≥actices ≥ewa≥d in the long-te≥m. A mode≥n business is mostly judged by its effo≥ts to ≥educe ca≥bon footp≥int and p≥omote the public good,” BOB COLLYMORE, SAFARICOM CEO In a recently released African sustainability barometer report by the UN’s Global Compact and This is Africa, a publication from the Financial Times Ltd, that seeks to examine African business and politics in a global context, Kenyan companies formed 10 per cent of the total companies in the barometer, with 93 per cent of them funding education centric CSR programmes. Notable companies on the list included East African Breweries, Safaricom, KCB, Equity Bank and Athi River Mining among others. These frontrunners are, however, part of a deepening movement, with data from the Capital Markets Authority showing that 36 companies listed on the Nairobi Securities Exchange have integrated sustainability in areas such as education, health, agriculture and the environmental. Safaricom leads the pack having released its third sustainability report last year that touches on environmental protection, labour rights, peace and protection of vulnerable groups. “Sustainability has gained traction as businesses realize that ethical practices reward in the long-term. A modern business is mostly judged by its efforts to reduce carbon footprint and promote the public good,” Bob Collymore Safaricom CEO told journalists highlighting practices that have advanced social and environmental ethos in all value chains. The report which is in line with the Global Reporting Initiative and UN Global Compact guidelines, details imperatives and opportunities in network quality, innovation, energy security, employee environment, regulatory environment, customer experience, business partner ecosystem, ethics and values as well as environmental performance. According to the report, Safaricom let go of 56 staff members found culpable of fraud and corruption in the year ending March 2014 as it sought to maintain the highest level of transparency.

Kenya Commercial Bank, the first bank to have embraced sustainable reporting in 2008, has has consistently reported it been guided by the three Ps of People, Planet and Profit. The bank’s approach to sustainable reporting has been through a ten point action point which touches on capacity building, responsible lending, energy reduction, ethics and integrity, environmental impact and employee development, among others. According to its 2013 report the bank has trained 1,500 of its employees on environmental and social risk assessment and the KCB green agenda, sponsored 10 paediatric kidney transplants, invested Sh600 million in community buildings since 2007, and donated 750 solar lamps to school going children to assist them in studying at night. “Today, our commitment to stakeholders is to demonstrate every year, in a Sustainability Report, how decisions and actions in our banking businesses are rooted in a deep concern for sustainability in all we do. Our objective is to progressively implement sustainability initiatives in our business operations to result in tangible business benefits,” read the bank’s CEO Joshua Oigara’s statement during the release of the report. Another innovator has been tea and horticultural company Finlays, which has managed to transition its businesses to using renewable energy with 70 per cent of its energy coming from renewable sources. The installation of new equipment, such as boilers, and attention to operating practices have contributed to the overall reduction in energy, carbon and water use by the company. The company has also been at the forefront in championing The Imarisha project to tackle the degradation of Lake Naivasha and its catchment and to put any future development on a sustainable footing, as well as initiatives to protect major water catchment towers.

Active However, American based Information Technology Company Hewlett Packard, HP, offers the classic example of well managed sustainability reporting in its value chain and its many programmes, including in Kenya. Its signature carbon foot print disclosure far outpaces that of any other company currently engaged in sustainability reporting and carbon reporting. The company evaluates its products and services’ carbon emissions across its entire value chain, including raw materials extraction, manufacturing and logistics. It has focused on the supply chain’s effects on people, moving HP’s manufacturing to Chongqing, a city of seven million over 1,000 miles west of Shanghai China, to halt the flow of migration to China’s coast, a trend underway for 30 years as millions of Chinese have left their hometowns in remote and rural areas to find work in eastern and southern China. Having factories in Shanghai has also meant PCs and other products can be shipped to Europe by rail, avoiding transport by airplanes and ships, with the benefit of reduced emissions for HP. But in what is seen as a holistic approach to its sustainable reporting, HP has also invested in social enterprise projects in Kenya. It has provided seed money and technology to speed up the testing of HIV in infants with over 200,000 children tested, and launched now 40 e-waste recycling centres in the country. “We see increasing interest among corporations and investors in sustainability reporting both as a way to ensure that environmental and social impacts are managed and as a way to assess the quality and commitment of management. Assured reports earn even more credibility. Half of the survey participants indicated sustainability reporting gives them a competitive advantage and some 68 per cent said they issue a sustainability report,” read the MIT Sloan Management Review Another study by Cone Communications and Echo Global found that consumers now expect companies to be an active participant, if not a driving force, in solving the most pressing social and environmental issues. In other words, CSR is no longer option, but an operational imperative. -AFRICAN LAUGHTER

COMMENTARY

the edge: Managing for triple bottomline

It’s time to do business with a conscience BY JUDY NJINO

n the past decade, the African continent averaged an annual growth rate of real output of around five per cent, placing it as one of the fastest growing continents. The irony is that developmental growth has yet to play catch up with economic growth and sub Saharan Africa still lags behind in terms of poverty reduction, high unemployment rates and corruption. While there are many factors that contribute to this scenario, where economic gains do not translate into better quality life for the people, the private sector plays a key role. The post-2015 development agenda recognises this gap and hopes to address this dichotomous growth through its universal transformative shifts where developmental outcomes are anchored in inclusive and sustainable structures. The use of sustainable business models requires a paradigm shift. Firms need to adopt models founded on ethical principles and values which ensure that growth is inclusive and meaningful. The private sector needs to embrace these principles, not because they look good on paper, but because they are sustainable. They need to assume responsibility for the social, environmental and economic impact of their activities, which if not looked into, will result in a negative rebound effect that will affect their long term growth. UN Global Compact principles have been developed to allow companies to do business ethically. They outline practical things that companies can do specifically to tackle these challenges. Key aspects include the need for companies to adopt a principled business approach by addressing areas such as human rights, labour laws, environmental principles and putting in place anti-corruption measures. This calls for a company to have the requisite business policies in place and to ensure implementation of the policies through continuous assessment. Companies also need to step out of their comfort zones and support the community at large.

By addressing societal issues such as poverty, conflict, scarce resources and illiteracy, they can make a big impact on their own viability and success. Already, scarce resources such as water have an effect on investments made and firms that rely heavily on water as an input now have to declare water risks in their investment profiles. This is just one example of how an unaddressed environmental aspect can dent a company’s profitability. The leadership in a company should show great commitment to sustainability principles and work on the cultural transformation in the workplace needed to make this happen. Policies need to be adopted and implemented which can only happen if there is ownership by top management. This goal can be achieved through the motivation and capacity building of employees and demanding for similar actions from other actors in the supply chain. Overall accountability can only be measured through periodic reporting procedures so as inform the society and stakeholders of the efforts that have been put into sustainability and to keep track of what needs to be improved. Since no company exists in a vacuum, it is necessary to undertake local action in the society through measures such as networking, advocacy and partnership that lead to better and happier societies. The Global Compact network in Kenya is available to businesses that are interested in taking leadership in embedding sustainability. With over 100 organisations signed up, the network brings businesses together to learn, exchange best practices and access management tools. By guiding companies in integrating the ethical business principles, that I have outlined, into the day to day operations of a company for more positive impact on its ecosystem, the network forms a support mechanism for companies that want to listen to their conscience. Ms Njino is the co-ordinator, Global Compact Network Kenya

BUSINESS DAILY | Friday April 17, 2015

the edge: Managing for triple bottomline

Su≥ge in f≥aud takes ﬁ≥ms back to d≥awing boa≥d

TRANSPARENCY INTERNATIONAL CORRUPTION PERCEPTIONS INDEX 2012

Businesses take extreme measures, including naming and shaming corrupt employees, to shield themselves from reputational ruin BY VICTOR AMADALA AND MWENDIA SILVIA

ompanies, world over, are deploying new strategies to fight procurement fraud, following the findings of the Kroll Global Fraud Report 2013/2014, which indicated a sharp rise in the vice in private firms. Procurement fraud increased to 19 per cent up from 12 per cent the previous year, while general fraud in the private sector increased by 9 per cent to a whopping 70 per cent. It is a surge that has sent the management of both large and medium size private firms to the drawing board, ostensibly to come up with or implement some of the best fraud curbing strategies in business history. Such practices have often been driven by calamitous frauds that have called for extreme corrections to rescue a company’s reputation and business. In mid-2011, for instance, Toronto Mayor Rob Ford was found to have been helping RR Donnelley, a major Chicago-based printing company, pursue some of the City of Toronto’s $9 million printing business while also discussing a deal that would see Donnelley refer client leads to Deco Labels and Tags, the Fords’ family company, according to documents obtained by The Globe and Mail and interviews with a former Deco sales manager. This procurement dishonesty ruined the company’s reputation across the world, which resulted in loss of millions of dollars.

Confidence To restore honesty in the company, the management of Deco Labels and Tags came up with strict procurement procedures that limit correspondence between bidders and the company’s staff. The division of duties built into the procedures for setting up suppliers, and placing and approving orders via the company’s SAP purchasing system, was one of the strategies employed. This was done to avoid monopolisation of procurement procedures by specific staff members. The use of Purchasing Cards was also introduced to mitigate the risk of payment fraud, where the procurer and external fraudster act alone. When setting up suppliers on the SAP purchasing system, the Procurement Unit’s Category Managers are also required to confirm whether proposed new suppliers have been selected in compliance with the company’s procurement procedures. The policy has enabled the company to not only regain its market confidence, therefore emerging stronger from economic backlash it had experienced in 2011/2012 financial year, but also become a case study of how companies can overcome procurement fraud. Other studies have proposed various ways companies can prevent procurement fraud. According to a report by Deloitte, establishing a right culture is key, by making sure that everyone in the company ascribes to a company’s zero tolerance policy to procurement fraud. “While paying bribes may be part of the business culture in some parts of the world, an organisation that condones bribes will at some stage find itself in the regulatory or investor spotlight. Setting the right ethical tone within the

organisation is therefore vital. So too is communicating this tone to business partners,” states the report. The study also suggests that companies implement a clear division of duties. According to Deloitte, the segregation of duties should ensure no one individual is tasked with overseeing the whole transaction. This reduces the amount of control one person has over each business process. Another method of reducing procurement fraud is to assess internal controls. This covers the regular review of existing controls, thresholds and procedures for relevance, eﬀectiveness and adequacy. In order to understand fraud, one must understand the risks involved in a control system. The use of technology to detect fraud is also an eﬀective way to reduce or prevent it from happening. According

to a report by KPMG on Procurement Fraud in Consumer Companies, one of the tools used for this is forensic data analysis. Firms should optimise the data they collect on their companies. This data can help them detect procurement fraud through identification of potential fraud misconduct and waste through sophisticated analysis testing, cross-matching and non-obvious relationship identification. “Other applications include performing analysis to assist an investigation prompted by behavioural red flags traditionally associated with fraud or misconduct such as living beyond one’s means, an unusually close association with a customer and the infrequent taking of holidays,” states the report.

Friday April 17, 2015 | BUSINESS DAILY

VII

the edge: Managing for triple bottomline

AFRICAN OVERVIEW Sub-Saharan Africa retains the unenviable distinction of having the most widespread fraud problem of any region in the survey. Not only was its overall incidence the biggest in the survey (77% of respondents say that their companies were hit), it had the highest regional ﬁgures for theft of physical assets corruption, regulatory or compliance breach , internal ﬁnancial fraud and misappropriation of company funds

CONSUMER GOODS Theft of physical assets or stock – a traditional bane of the consumer goods industry – affected the companies of 41% of respondents in this sector, the third-highest level of any industry in this survey and again well up on the 2012 survey (26%). Despite these growing problems, consumer goods companies still have the lowest average fraud loss of any sector (0.9% of revenue).

SOURCE: GLOBAL FRAUD REPORT /ECONOMIST INTELLIGENCE UNIT REPORT CARD

HEALTHCARE, PHARMACEUTICALS & BIOTECHNOLOGY With prevention being better than a cure, companies are better off practising ways to prevent procurement fraud before it ruins them. As the Deloitte report states, “the amounts paid to settle any claims resulting from exposed fraud will always be secondary to the loss of reputation and integrity that companies may suffer for being associated with such claims.” However, perhaps the most effective tool in limiting losses to companies and removing many of the incentives to bribe is the practice of reference pricing, where procurement operations are bound to precise prices in what they can pay for products, based on normal market rates.

By fixing the prices payable, companies remove some of the incentive for bribing, leaving the beneficiaries dealing with the constraints of normal, production based pricing and with nothing extra to fund any bribes along the way. As yet, no one practice has emerged that can remove all possibility of procurement fraud, but as companies reveal from the ever greater costs of such personal siphoning, the concerted efforts to fix prices, spot ‘ties’ and capture procedural bypassing, are collectively closing down the space for such fraud and making the winnings harder and far riskier for criminals chasing procurement bonuses. -AFRICAN LAUGHTER

Healthcare, pharmaceutical and biosciences sector has the third-highest overall sectoral incidence of fraud (74%), along with one of the largest proportions of respondents seeing an increase in fraud exposure (85%).

VIII

BUSINESS DAILY | Friday April 17, 2015

the edge: Managing for triple bottomline

Safa≥icom walks the unt≥odden path of f≥aud ≥epo≥ting Chief executive Bob Collymore says the move has made staff more conscious of the impact of their actions on business BY DAVID HERBLING

afaricom chief executive Bob Collymore made up his mind one morning in September 2012 to walk down a path less trodden: making public cases of corporate fraud at Kenya’s biggest telco. Mr Collymore has remained faithful to the cause ever since, issuing annual updates that offer never seen before details on economic crimes at Safaricom, including accounting fraud, asset misappropriation and bribery; as well as disciplinary action taken against culpable employees. The 57-year-old CEO admits it wasn’t easy convincing the firm’s board, management and staff on the need to lay bare issues of integrity at the corporate level. Part of the strategy would also see Safaricom name and shame staff accused of fraud and professional negligence. “Initially it was not easy convincing my team that we get to this level of transparency but the results have benefited all areas of our business,” said Mr Collymore in an interview. “We find that staff are more conscious of the impact of their actions and start to view projects through

a sustainable lens, which transforms the way we do business as a whole.” The fraudulent dealings are captured in Safaricom’s annual sustainability reports, which highlight the telco’s economic, environmental, social and governance performance, as opposed to the regular annual reports, which are heavy on financial performance. “When people know that they can get fired or lose contracts because we have a zero tolerance approach to unethical behaviour, it encourages a more honest space in which to do business,” said Mr Collymore. Safaricom’s sustainability reports show it has sacked a total of 159 employees in the past three years over theft and bribery. The mobile telecommunications firm fired 56 workers in the year to March 2014 due to fraud, up from 33 members of staff shown the door a year earlier, and an all-time record of 70 sackings in 2012. The bold move by Safaricom to lift the lid on corporate fraud has now, inspired Kenya’s biggest bank KCB to join the sustainability reporting bandwagon. “It is good to see a big banking sector player getting engaged in sustainable reporting and we are pleased to see them leading the industry in this type of reporting,” said Mr Collymore after KCB unveiled

its pioneer sustainability report in 2014. KCB said it fired 90 employees in the year 2013 who were caught abetting malpractices, such as identity theft, cheque tampering, credit card fraud, and phony electronic funds transfers. Safaricom and KCB are the only Kenyan firms that reveal staff fraud statistics, in an environment where most firms prefer to remain silent over economic crimes, fearing a public relations backlash and brand damage.

Betray But “our business is anchored in trust. We are therefore unapologetic for parting ways with members of staff who betray the ethical standards of behaviour that KCB Group abides by,” chief executive Joshua Oigara said in an earlier interview. “Cases of fraud at KCB Group are investigated thoroughly and dealt with decisively,” he said. Robert Nyamu, forensic services director at Deloitte & Touche, argues that most firms prefer to keep fraud cases under wraps because the resulting reputational damage far outweighs the actual financial losses. This makes full fraud statistics hard to come by. Moreover, the Central Bank of Kenya, the banking industry regulator that hosts the Banking Fraud Investigations Department (BFID), does not make public the figures on fraud or the extent of the vice. Data from BFID does, however, show that financial institutions lost Sh850 million worth of customers’ cash in the first six months of 2014, as fraudsters exploited gaps in online banking solutions and colluded with bank staff to steal from accounts. Of this, investigators managed to recover only Sh600 million, highlighting the complexity of tracing cyber-based banking fraud.

“Initially it was not easy convincing my team that we get to this level of t≥anspa≥ency but the ≥esults have beneﬁted all a≥eas of ou≥ business,” BOB COLLYMORE, SAFARICOM CEO

Friday April 17, 2015 | BUSINESS DAILY

BUSINESS DAILY | Friday April 17, 2015

the edge: Managing for triple bottomline

Wanted:Bette≥ d≥iving habits to stop pollution VICTOR JUMA explores how motorists and regulators are responding to increased trafﬁc jams that are costing transporters and households billions of shillings in higher fuel consumption, lost man hours and increased carbon emissions

he incessant traffic jams on Kenyan roads are generating costs for households and commercial transporters alike, through higher fuel consumption, lost man-hours and increased carbon emissions that have been linked to a variety of diseases and global warming. This is now focusing attention on ways in which better driving habits can mitigate the negatives of moving people and goods on roads that get more congested by the years. A number of research publications now suggest that choosing to switch off the engine or leave it running in stationary conditions can have a major impact. “Idling for more than 10 seconds uses more fuel and emits more carbon dioxide than engine restarting,” Argone National Laboratory, which conducts research for the US Department of Energy, concluded in a study on the effects of starting and idling engines. It found that idling fuel usage varies from 0.7 litres to 1.8 litres per hour for passenger vehicles across a range of sizes, and increased with idling speed (the speed of the engine’s rotation while a car is motionless). While restarting causes initial higher emissions, this is offset by the savings made while the engine is switched off. “For short stops, it makes sense to turn the vehicle off in order to minimise fuel use and CO2 emissions,” the report concludes.

Other studies found that a typical truck burns approximately 3.7 litres of diesel for each hour it idles. “If this truck idles for six hours per day and operates 300 days a year, it would consume 6,813 litres of fuel per year, simply idling,” reads part of the study by the US Environmental Protection Agency (EPA). At the current price of Sh76.2 per litre of diesel in Nairobi, this makes for an annual price tag of Sh520,000 per truck. While traﬃc jams are a major cause of idling, drivers have also been found to idle even when they are not on the road. Truck drivers, for instance, may idle to keep the cabin and/or sleeper heated or cooled.

Losers Idling additionally causes excessive engine wear compared to a motor vehicle in motion. According to the American Trucking Association, such wear can increase maintenance costs by almost $2,000 (Sh183,000) per year and shorten the life of the engine. In fact, drivers, the general public and the earth at large become major losers whenever idling occurs. “While sitting in an idling vehicle, drivers are exposed to the vehicle’s pollution more so than when the vehicle is in motion, since there is no air ﬂow to vent the emissions,” the EPA study concludes. The pollution from idling vehicles spans carbon dioxide, nitrogen

oxides, poisonous carbon monoxide, and volatile organic compounds that contribute to climate change. Besides idling, a series of driving habits can further affect fuel consumption, according to the US Energy Department. “Quick acceleration and heavy braking can reduce fuel economy by up to 33 per cent on the highway and five per cent around town,” the agency said, noting that aggressive driving works against fuel economy. Driving at higher speeds, especially above 120 kilometres per hour, increases aerodynamic drag (wind resistance) and ultimately increases fuel consumption. The drag is worsened by cargo racks on top of the vehicle. Towing a trailer or carrying excessive weight also decreases fuel economy, as does the under-inflation of tyres, which increases tyre wear, while increasing fuel consumption by up to three per cent. “Cold weather and frequent short trips can reduce fuel economy, since your engine doesn’t operate efficiently until it is warmed up. In colder weather, it takes longer for your engine to warm, and on short trips, your vehicle operates a smaller percentage of time at the desired temperature.” The EPA found that running electrical accessories also increases fuel consumption, with a driver operating an air conditioner on “Max” burning five per cent to 25 per cent more fuel than normal. Naturally, those whose routes go through hilly or mountainous terrains can expect to burn more fuel as the engine works harder to overcome the extra force of gravity. SUVs, four-wheel drives and bigger vehicles also tend to consume more fuel. “Engaging all four wheels makes the engine work harder and increases transfer case and differential losses,” said the EPA.

Friday April 17, 2015 | BUSINESS DAILY

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the edge: Managing for triple bottomline

Wate≥ conse≥vation: The jewel of co≥po≥ate ≥esponsibility ≥ace

enough water during prolonged dry periods. But increasing the storage capacity raises the construction and operating costs making it expensive (particularly for lower-income households. Moreover, looking at the viability and cost aspects of water recycling, the Australian recycling report shows that as a water source, treatment of waste water involves energy use that may be higher than surface water, but lower than desalinated water. In addition, the use of recycled water prevents an equivalent volume of waste water discharge to receiving water, which can aﬀect environmental, health and recreational use. “A range of other impacts can be associated with recycled water in certain settings, such as its certainty of supply during drought and its sanctioned use during times of water restrictions. An understanding of the environmental and social values associated with recycled water is predicated upon a sound understanding of the environmental and social impacts of recycled water,” concludes the report.

WHAT THE NUMBERS SAY GLOBAL PHYSICAL AND ECONOMIC WATER SCARCITY

UN’s Human Development Report estimates that rapid population growth and climate change will see half of the world living in areas with high water stress by 2030 BY DOREEN WAINAINAH

A The≥e a≥e ove≥ 1,400 million squa≥e kilomet≥es of wate≥ on ea≥th yet only 0.0001 pe≥ cent of it is easily accessible fo≥ human consumption

round 700 million people in 43 countries suﬀer from water scarcity. By 2025, 1.8 billion people will be living in countries or regions with absolute water scarcity, and twothirds of the world’s population could be living under water stressed conditions. This, coupled with climate change, will see half the global population living in areas with high water stress by 2030, according to the United Nations Report on Human Development. There is over 1,400 million square kilometres of water on earth yet only 0.0001 percent of it is easily accessible for human consumption, according to the handbook on rain water harvesting in the Caribbean, produced by the Caribbean Environmental Health Institute. Sources of water to meet our needs include surface waters (rivers and lakes), ground water (water stored below-ground in aquifers) and rainwater. But the capture, storage and use of rainwater, called Rainwater Harvesting (RWH) is the oldest method of securing water, having been practised by ancient civilisations for more than 4,000 years. With advancement, water recycling has also emerged as a leading form of water harvesting, with Israel emerging as a leader in the technique, to such an extent that the country has now developed a billion-dollar industry selling its water recycling technologies and expertise. Israel, reports Reuters, was forced to address water scarcity when its main sources, the Sea of Galilee and two aquifers, became overtaxed, even as the population was growing. There was

simply not enough water for agriculture. The country now has an 80 per cent water recycling rate, higher than any other country in the world. The second largest water recycler, in recent years, has been Spain, with a rate of 18 per cent. Other notable waste water recycling nations are Australia, Italy and Greece, which recycle 9 per cent, 8 per cent and 5 per cent. The US and Central Europe recycle a paltry 1 per cent each. The Israeli ministry of economy additionally touts that Israel invented drip irrigation, which is far more eﬃcient than other irrigation methods and has helped it achieve 70 to 80 per cent water eﬃciency in agriculture, the highest rate in the world. The country has also achieved the highest ratio of crop yield per water unit in the world.

Other nations similarly aﬄicted have not moved so fast. Australia, the world’s driest continent, receives less than an average 600mm of rainfall a year, with arid and semiarid desert lands making up 70 per cent of mainland Australia – a total of about 5.3 million square kilometres. Industries and communities across Australia are increasingly embracing water recycling as a key response to sustainability and water security drivers, states the Australian Water Recycling centre of excellence report on the economic viability of recycled water schemes But there can be ﬁnancial constraints. Low storage capacity limits the volume of rainwater that can be harvested, such that Rain Water Harvesting systems may not be able to provide

The number of people around the world who lack access to safe water; approximately one in nine people.

due to diarrhoea caused by inadequate drinking water and sanitation. This translates to an estimated 842,000 people every year globally .

FRESH WATER SUPPLY Fresh Water lakes & Rivers

Fresh Water

2.5%

Deteriorate

FRESH WATER USE

0.3%

Domestic

Ground Water

30%

Industry

22%

Salt Water

Ice Snow cover in mountainous region

97.5%

1.4 billion km3

Irrigation

70%

The total earth’s water supply (both salt and freshwater) of which 97.5% is oceanic. The remaining 2.5% (35 million km3) is fresh water.

GLOBAL WATER RECYCLERS

80% 18% Israel

Spain

Austra

Italy

Greece

INTER-RELATIONSHIP OF WATER RISKS AMONG BUSINESS, GOVERNMENT AND SOCIETY

1% Central Europe

According to the Caribbean rainwater harvesting manual, cisterns and water storage facilities can also act as breeding grounds for mosquitoes where not adequately sealed, and rainwater harvesting can reduce revenues to public utilities and cause variable demands on public supplies. In sum, water harvesting technologies can help in dry periods, but provide less insurance against drought (seasonal and annual). Against this backdrop, the conditions for rain fed cropping, and for rainwater harvesting and conservation are set to deteriorate in the tropics and semi-arid tropics as a result of climate change. “Water scarcity in some arid and semi-arid places will displace between 24 million and 700 million people with Sub-Saharan Africa has the largest number of water-stressed countries of any region,” says the UN Report on Human Development. In Israel, the solution has been to maximise the utility of all types of water resources, whether surface water, underground water, brackish water, sea water, or eﬄuents. Israel is home to the world’s largest seawater reverse osmosis (SWRO) desalination plants, annually producing 140-150m m3 at the low cost of approximately $0.52 per m3 of water, the most cost-eﬃcient of its kind in the world. Over 35 per cent of Israel’s drinking-quality water now comes from desalination, while desalinated water accounts for around 80 per cent of total domestic water use in Israeli cities.

Sea≥ch is on fo≥ technology that imp≥oves access to clean wate≥ BY VICTOR AMADALA

Stakeholders in Kenya’s water sector in are embracing new technology in a bid to improve domestic water accessibility, as the country struggles to meet the United Nation’s 50 litres per person a day requirement, from the current 20 litres a day. With 80 per cent of Kenya’s landmass being arid or semi arid, water scarcity is creating stiff competition for the limited water available to both plants and animals. The government, Non-Governmental Organizations (NGOs) and private sector have invested in water projects across rain water harvesting, recycling and manual bore holes, especially in drought prone regions, which include North Eastern, Eastern and at the Coast. But, according to the United Nations Development Programme (UNDP), Kenyan women still spend an average one third of their lives searching for or fetching water. The price of organized supplies is also unusually high, driven by the costs of electric pumping and treatment, forcing families to resort to contaminated waters, which drive 70- 80 per cent of health issues in local health centres, according to Kenya Open Data. In light of these challenges, stakeholders in the sector are now rolling out new technologies to improve accessibility to clean water. In Lodwar, a drought prone area, a local water company, Lodwar Water Services Company (Lowasco) recently partnered with water and energy

solutions provider, Davis and Shirtliff, and the Japanese Aid Agency (JICA), in a Sh16m project to install solar hybrid bore hole pumping systems in three of its seven bore hole ﬁelds in Lodwar, lowering water costs and supply by a full 33 per cent. The exorbitant cost of electricity had kept the cost of supplying water in the area high, with Lowasco spending Sh45 to supply each cubic meter of water while charging its clients just Sh33 per cubic meter – consequently incurring a loss of Sh12 per cubic meter supplied. The shift has now moved the company back into proﬁtability, while also lowering water costs to residents, with the boreholes now pumping water using solar energy by day and switching over to mains power by night, when the demand for mains power is at its lowest. Previously, water from the bore holes was pumped solely by mains electricity, which was not only unreliable, but also extremely expensive. To make the changeover, Davis and Shirtliff installed 94 solar panels on one borehole and 144 solar panels on each of the other two and added hybrid generators, so that each borehole supplies between 125 and 250 cubic metres of water a day With the desert town of Lodwar receiving an average 9.6 hours of sunshine a day, higher than most towns in Kenya, according to the Kenya Meteorological Department, drastically lowering the reliance of the three bore holes on mains power through use of solar energy was deemed a viable alternative in improving water supply to the business hub of Turkana.

A handcart pusher transports water containers for resale in Kisumu. They are used for fetching water from rivers and harnessing rain water in places not connected with piped water. FILE

WATER WITHDRAWAL BY SECTOR (%) Water is the key to food security. Globally, there is enough water available for our future needs, but this world picture hides large areas of absolute water scarcity which affects billions of people, many of whom are poor and disadvantaged.

people die daily

million

GLOBAL WATER SUPPLY

Constraints

2,300 750

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the edge: Managing for triple bottomline

82%

The percentage of people who lack access to improved water and live in rural areas, while just 18% live in urban areas.

MANAGING WATER UNDER UNCERTAINTY AND RISK THE UNITED NATIONS WORLD WATER DEVELOPMENT REPORT 4 HTTP://WATER.ORG/WATER-CRISIS/WATER-FACTS/WATER/ FUTURE WATER (IN)SECURITY: FACTS, FIGURES, AND PREDICTIONS GRAPHIC: GENNEVIEVE NAHINGA

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BUSINESS DAILY | Friday April 17, 2015

Friday April 17, 2015 | BUSINESS DAILY

the edge: Managing for triple bottomline

Wate≥ conse≥vation: The jewel of co≥po≥ate ≥esponsibility ≥ace

WHAT THE NUMBERS SAY GLOBAL PHYSICAL AND ECONOMIC WATER SCARCITY

UN’s Human Development Report estimates that rapid population growth and climate change will see half of the world living in areas with high water stress by 2030 BY DOREEN WAINAINAH

A The≥e a≥e ove≥ 1,400 million squa≥e kilomet≥es of wate≥ on ea≥th yet only 0.0001 pe≥ cent of it is easily accessible fo≥ human consumption

The number of people around the world who lack access to safe water; approximately one in nine people.

due to diarrhoea caused by inadequate drinking water and sanitation. This translates to an estimated 842,000 people every year globally .

FRESH WATER SUPPLY Fresh Water lakes & Rivers

Fresh Water

2.5%

Deteriorate

FRESH WATER USE

0.3%

Domestic

Ground Water

30%

Industry

22%

Salt Water

Ice Snow cover in mountainous region

97.5%

1.4 billion km3

Irrigation

70%

The total earth’s water supply (both salt and freshwater) of which 97.5% is oceanic. The remaining 2.5% (35 million km3) is fresh water.

GLOBAL WATER RECYCLERS

80% 18% Israel

Spain

Austra

Italy

Greece

INTER-RELATIONSHIP OF WATER RISKS AMONG BUSINESS, GOVERNMENT AND SOCIETY

1% Central Europe

Sea≥ch is on fo≥ technology that imp≥oves access to clean wate≥ BY VICTOR AMADALA

A handcart pusher transports water containers for resale in Kisumu. They are used for fetching water from rivers and harnessing rain water in places not connected with piped water. FILE

people die daily

million

GLOBAL WATER SUPPLY

Constraints

2,300 750

XIII

the edge: Managing for triple bottomline

82%

The percentage of people who lack access to improved water and live in rural areas, while just 18% live in urban areas.

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BUSINESS DAILY | Friday April 17, 2015

the edge: Managing for triple bottomline

Big businesses cut costs with bette≥ use of wate≥ As water companies increase their prices and the population grows, the need to capture, store, ﬁlter and reuse rainfall is becoming increasingly important

derground reservoirs, and direct water through submersible pumps that then pump water into various areas of the building like toilets, and the factory. The rainwater-treatment station is a complex fabrication that must allow for aeration of the water in the underground storage reservoirs. It also controls and operates the pumps in the underground pressurization station, as well as performing critical functions to ensure the safe re-use of the harvested rainwater. The treatment station ﬁlters, disinfects and recirculates the water. “It has been one of the most successful ventures we have invested in as a company and we are glad to report that harvesting water has been key in supplementing the needs of our facilities. One of the key parameters that assisted us in getting our ISO certiﬁcation was the use of water harvesting in our business operations,” said Kareem Hakeem , operations manager at Bluetag Africa Limited. Limelight Group, which runs Bukaki primary and secondary schools and Transmina hospital in Athi River, has also perfected the art of rainwater harvesting, with the harvested water being used in the school garden to grow produce for the school and the hospital, while a parallel water harvesting model is used in the hospital taking care of all water related needs of the hospital. With the farm model, the company has managed to create 100 jobs in the ten acre school and hospital garden with the produce like kales, tomatoes, and fruits sustaining the two institutions throughout the year.

Successful

Corporations say that though the initial investment in water harvesting technology may be high, the long-term beneﬁts far outstrip the initial pain BY BOB KOIGI

ompanies keen on cutting their water bills and conserving water are embracing water harvesting -- capturing, diverting, and storing rainwater for later use in a business model that is delivering a win-win for these companies, saving some up to 70 per cent of all expenses associated with water. As water companies increase their prices and the population grows, the need to capture, store, ﬁlter and reuse rainfall is becoming increasingly important. Coupled with consumer demand for companies to reduce their environmental impact, water harvesting is no longer a preserve of residential homes, but businesses and companies. While initial investment in water harvesting technologies might appear prohibitive for various companies especially SMEs, the long term beneﬁts outstrip the investment, reported companies that are already doing it. Denzel Kanyingi of Rainwater Harvesting Supply, a company that advises and installs water harvesting technologies for businesses and homes in

Kenya, says that from an initial investment of Sh4 million in water harvesting technologies like a roof drain system, and reservoirs, can save companies up to Sh20 million a year in water bills and the inconveniences of inadequate water occasioned by rationing and over reliance on water from the county government. “Harvesting their own water means they are guaranteed uninterrupted water supply while conserving on the precious resource. Some of these companies have used their water harvesting and recycling techniques to get ISO certification,” said Mr Kanyingi. Bluetag Africa Limited, a company involved in the manufacture of cartons and packaging material and based in Industrial Area is one such company. Through its sophisticated water harvesting model, it has managed to save Sh5 million each year in water bills while earning regional recognition for its role in spearheading water management in business. The company collects the rain water through a roof drain system which eventually flows into four underground reservoirs. Each reservoir has a gross storage capacity of 2,000 gallons, for a total gross storage capacity of 8,000 gallons. The underground storage reservoirs are installed using interconnecting piping that allows them to store equal amounts of water, and allows all of the water to flow towards an underground rainwater pressurization station. The pressurization station is designed to collect the gravity-flow from the un-

The water harvesting, which is done through trapping water from gutters across the group’s many buildings, has seen the company save over Sh30 million a year in water bills and on agricultural produce that they get free from the garden. “It has been a very successful model. Our greatest worry has always been the source of water in this area because weather is so unpredictable. But with this method and the sophisticated storage system we can comfortably grow produce and have water in the hospital and for the gardens for the next two years,” said Njoki Mukangu, spokesperson at Limelight Group. Commercial water harvesting is also being driven in Kenya by the concept of green buildings, which are embracing water harvesting and recycling in the face of depressed rains and increasing demand for water. The green building at the United Nations Environment Programme headquarters is a classic example of the success of commercial water harvesting for a company. The four-block complex located on the vast 140-acre piece of land in Gigiri captures about seven million litres of water a year through rain water harvesting from the roof. The building that houses the Strathmore Business School is another example. Strathmore Business School was awarded the Best Green Building Development in Africa by the African Real Estate and Housing Finance (AREHF) Academy Awards. Rain water is collected and channeled to an underground tank where it is treated before being pumped to the various water taps in the building. An estimated 90 per cent of water needs for the building are met using the harvested rain water. Indeed, experts in water aﬀairs now predict that the next big frontier in determining the success of companies will be in how they manage scarce resources, with water being one of them. Dr. Joachim Mwiti, with extensive training in land and water management and whose thesis at the University of Nairobi detailed the role of water harvesting in growing a company’s proﬁt and image, said companies who have made a commitment now to channel resources to collect water are more competitive than those that don’t. -AFRICAN LAUGHTER

Friday April 17, 2015 | BUSINESS DAILY

the edge: Managing for triple bottomline

Technology that helps fa≥me≥s stop climate change dis≥uptions BY JULIUS OMONDI

Coca- Cola headquarters in Nairobi. SALATON NJAU

Unique buildings that conse≥ve envi≥onment Coca-Cola shows the way with ofﬁce complex that reduces use of electricity through use of space and transparent material that allow in sunlight while preventing heating

BY ANNIE NJANJA

ngoing change in climate patterns has captured the attention of real estate developers, regulators and occupiers, driving construction methods that meet human needs, while helping to preserve the environment. Research shows that the building sector contributes up to 30 per cent of the annual global gas emissions and consumes up to 40 per cent of all energy, highlighting the huge effect of structures on environment. The figures are expected to double in the next 20 years if developers do not adopt the culture of green buildings. Green buildings are designed to be environmentally responsible and resource efficient throughout the structure’s life-cycle; which spans the choice of site, design, construction, operation, maintenance, renovation and demolition. In deciding to build its own Nairobi headquarters, Coca-Cola is one organisation that has played its part in mitigating global warming through the design of its offices in Upper Hill to achieve the best possible use of natural resources. The moon-shape of the Coca-Cola Plaza ensures that space and daylight is used to the maximum, while not allowing direct sunlight into the building that might then overheat the building and require air conditioning. “The positioning of the building ensures no direct sunlight into the offices, minimized heat gain and ventilation. The deeply recessed windows for filtered light, avoids glare and the roof garden insulates the building from heat gain,” said Bob Okello, the head of public affairs and government relations at Coca-Cola. The building has solar panels installed to provide energy for heating the water used in the gym and kitchen. It also has a roof top lawn that is meant to reduce heat gain in the office, again ensuring the minimal use of air conditioning when it is hot.

The company has reported saving about 30 per cent of its power bills since it moved to the plaza, as well as 30 per cent of its water costs. Rainwater harvesting and the large roof surface additionally see it collect 50,000 litres of water, used in the gym and to water the lawns around the office. The bathrooms are also fitted with hydro sensors that dispense water automatically, while the glass walls used in the interiors ensure the penetration of natural lighting. “The glass covered atrium enhances naturally lit interiors and cross ventilation,” said Mr Okello. According to Mr Okello, the best features of the green building are the roof garden, the orientation of the building that makes it stand out, the automatic fire sprinkler system throughout the building and the solar systems for heating gym water. The 6,000 square feet office and conferencing facilities was built at a cost of Sh700 million with construction works coming to an end in 2008.

Investment It was designed by GAPP Architects and Urban Designers of South Africa following a competition in late 2007. The design was implemented by Triad Architects, a local firm. The decision to make such a large investment in the construction of the regional base in Kenya was inspired by the company’s longterm growth plans. “Coca-Cola is one of the largest multinational companies in the world to have invested heavily in Kenya over the past decade through the establishment of its regional base in Kenya. This brings the number of countries managed from the Kenya regional office to 29,” said Mr Okello. “The ultra-modern office complex in Upper Hill is a key indicator of Coca-Cola’s confidence in Kenya and its willingness to invest and grow with the country as it strives towards the Vision 2030 objective. This is very sustainable investment, a key plank of our strategy.”

s climate change disrupts many rural communities in arid and semi- arid areas, prolonged droughts are causing severe food insecurity, forcing communities, with the support of development organisations, to embrace innovative technologies to triple their farm earnings and conserve the environment. Much of rural Kenya receives less than 800mm or 31 inches, of rainfall a year, with the dry season, that runs from June to October, causing widespread water shortages. A case in point is the semi-arid north of Mount Kenya, which has suffered recurrent droughts, environmental degradation, declining water resources, food insecurity and diminishing sources of household income. As a result, the Kenya Rainwater Association (KRA), with funding from United Nations Development Programme (UNDP), in 2010 formulated a community-based project in the area to mitigate the impacts of climate change on livelihoods and environment. The project, which has over time pooled over 1400 area residents through a community-based organisation known as Umande Rainwater Harvesting Project, has left a positive mark in health, agriculture and the environment. The project has over 48 individual self-help groups from across Daiga and Ontulili divisions in Laikipia East. According to Susan Kung’u from KRA, the members’ main concern was the impact of climate change and the diminishing water resources. They sought ways of increasing their community’s capacity to harvest, store, and manage rainwater for productive use. One of the major project components was the construction of 32 farm ponds, which can store 50,000 - 72,000 litres of water each during the wet season. The farm ponds are now vital sources of water for farmers who use them to irrigate their crops during dry periods. The farmers have also been taught how to harvest water through surface runoff, with the 50,000-litre underground reservoirs saving all the surface runoff from the nearby roads and cattle tracks. The storage tanks were constructed using dam liners to prevent seepage and each tank takes seven days to complete, costing about Sh32,000. The two- metre deep underground water ponds are covered with roof sheets to reduce water loss through evaporation, prevent contamination and safeguard against accidents. Once water is collected in the pond, the farmers use a low-head drip irrigation bucket kit to ensure that the crops are watered in the most efficient manner. Irrigation is a vital source for sustained agricultural production, with statistics from United Nations Environmental Programme (Unep) indicating that irrigated agriculture provides 40 per cent of world food production on only 17 per cent of total cultivated land. Drip irrigation is a micro-irrigation method where lowpressure water is allowed to drip slowly into the root-zone through emitters placed at pre-determined intervals, depending on crops spacing requirement. The method is most efficient and ideal for areas with water scarcity, because the water soaks into the soil before it can evaporate, according to Mureithi Johnson, chairman of Umande Rain Water Association. Most vegetables produced in Laikipia are as a result of the drip irrigation system, he says. “Over 75 per cent of our farmers have adopted the practice and are actively producing vegetables like kales, capsicums, courgettes, among others, and are therefore helping to avert the food security menace that was widespread in the area as well as improving on the farmers’ incomes.”

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BUSINESS DAILY | Friday April 17, 2015

COMMENTARY

the edge: Managing for triple bottomline

Quality is the hallma≥k of sustainability ma≥keting

BY JOHN GACHIRI

Consumers always look out for solid products that are well packaged and made conveniently available to them

he swanky oﬃce blocks that dot Nairobi’s skyline and high-end estates coming up in urban areas attest to the vibrancy that is Kenya’s real estate. But the work that goes on behind the scenes to put up the towers, apartments and other properties is anything but rosy. Kenya’s construction industry is one of the country’s biggest employers, but for its thousands of masons, porters, plumbers and electricians it is a job that is rife with danger. Falling debris, obstructive piles of building materials, electrocution risks, and the chances of falling from heights all make for common accidents on construction sites, and the consequences can range from cuts and amputations to death. Kenya’s industry does not have the monopoly over these accidents: worldwide, construction sites are some of the most dangerous workplaces. But reducing the chances and seriousness of accidents is a responsibility that project managers should take up, says Mentor Management Limited (MML). MML, a project development and management company, has over the last three decades made health and safety for its workers a core principle of its business. “If your work puts someone else’s life in danger you have a moral obligation to minimise that risk,” says construction director John Rogers. In eﬀect, a covenant exists between MML and its workers where in exchange for services rendered, employees get a salary and a guarantee that at the end of the day they will return home safely to their families.

BY MUTHONI WACHIRA-KANYANA

n the 20th Century, marketing became a new driver of change in society. Beyond the awareness that the products we consume are marketed to us, we should be aware that marketing processes also determine the political leaders we choose, where we invest our savings, where we go to learn, whether we take care of our own health or support a range of social initiatives. In recent times, fairly traded products have been one of the great success stories in marketing. The term fair trade was created in 1985 by author Michael Barratt Brown. Fair Trade organisations moved away from selling handicrafts to focus on agricultural commodities and the diﬀerence that fair prices could make on the producer communities. The success of Fair Trade companies over the past two decades has partly been driven by the increasing sophistication of their marketing, which instead of appealing just to consumers’ ethical values, have sought to compete against mainstream competitors in terms of product quality, pricing and packaging.

Code

Women use water from a bore hole in Meshanani near Namanga. The water project sunk by East Africa Breweries Limited Foundation will help provide water to residents living in the area. JEFF ANGOTE

Awareness Key facets of sustainability marketing are not just about creating awareness about a company’s sustainability credentials and ‘Fair Trade’ label but also about promoting quality products that are well packaged and made conveniently available to consumers. Sustainability marketing also places an emphasis on building a relationship between the final consumer and the people and communities behind the products they buy. Why, one may wonder, is all this important? The rapid population increase, technological changes and unprecedented economic growth of the 20th Century have all combined to pose a number of challenges including climate change and health. Climate change, especially, has become an issue that has woven together many of the other challenges facing humankind as either a cause or an effect. I recently read a story about snakes that are raiding the homes in Kandui Village, Kitui, due to effects of climate change. Experts say that a warming of

Const≥uction ﬁ≥ms g≥apple with high levels of accidents

the environment is forcing the snakes out of previously cooler habitats. The clearing of forests and the frequent droughts force the reptiles to go into people’s houses in search of cooler habitats. KWS director- general William Kiprono says the government has set aside Sh3 billion to compensate victims of human-wildlife conflicts, but confirmed that increased cases of snakebites have become overwhelming. Snakebites have dramatically increased in the past 10 years, from 20 reported cases in 2003 to more than 300 last year. In the United States, President Barack Obama has said that global warming isn’t just affecting the weather, its harming Americans’ health. Mr Obama’s effort to link climate change to health comes as he works to build support for steps he’s taken to curb US emissions, including strict limits on vehicles and power plants. A report published by the United Nations’ World Commission on Environment and Development in 1987 described sustainable development as a meeting of needs

of the present without compromising the ability of future generations to meet their needs. It is essential that companies take an ethical stand on development issues – individuals will not do it and governments are notoriously slow. Growing concerns about the environmental and social impacts of economic growth, and particularly concerns about the impacts of resource depletion and climate change are bound to push businesses and marketers to search for more sustainable ways of maintaining relationships with customers and delivering value to them. Ultimately if humankind is to avoid environmental and social disaster caused by unsustainable patterns of business, growth and lifestyle that emerged during the last century, marketing has an important role to play as a pathway to delivering transformation for sustainable development. Muthoni is group head of Marketing, CSR & Sustainability at Imperial Bank

To live by this principle the company uses a stringent code of conduct for all its projects, contractors, workers, and anyone with access to its managed sites, enforcing health and safety by focusing on the “weakest link”. Mr Rogers says its rules are centred on people who have never worked at construction sites before, because these are the most vulnerable, unlike experienced workers. At the same time, simple rules, such as wearing helmets, boots and vests have to become second nature for all its workers. The use of the right equipment, and creating designated paths for anyone accessing the sites, are other safety measures that minimise the risk. Random inspection and counterchecking is routinely done by MML managers, with the same code of conduct extending to contractors. Mr Rogers says that, at times, MML has had to shut down sites, at the contractor’s expense, after contractors failed to adhere to the safety standards, which acts as an incentive for ﬁrms to follow the rules. On the face of it, all these processes may seem expensive, but in the long run they have economic beneﬁts that trickle down to clients, as well as MML. Mr Rogers says that by enforcing high quality standards along the value chain buyers know that their investments, be they in apartments or shopping malls, are of a high quality and they are willing to pay a premium. This approach has earned MML a strong reputation, across projects that include Garden City, Donholm Housing Estate, Windsor Hotel, Junction, and Village Market.

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Friday April 17, 2015 | BUSINESS DAILY

the edge: Managing for triple bottomline

to 2,690, and touched 5,190 at the end of March 2014. The upgrade of Safaricom’ network from 2G, to 3G and now 4G, coupled with the intensive investment in fibre optic cable across Nairobi and Mombasa, also increased the company’s demand for energy. This forced the telecoms giant to make hard decisions on which power sources to deploy and how. A large part of the solution, however, came from unexpected areas, such as purchasing. “We came up with a rule on procurement and insisted that we would henceforth only buy technology that moved us towards the intended direction – of being a low energy consuming company,” said Mr Rerolle. The rule saw every technology bought by Safaricom assessed for its energy saving capability. “As we look to grow our network, access to reliable and cost–effective energy is an important consideration in our planning processes. In our facilities, a number of initiatives have been undertaken,” he said. For example, the firm has invested in a Building Management System and LED lights in all its facilities and shops. It has also installed solar water heating systems in its cafeterias, gyms, in the Jambo Contact Centre and at Safaricom House.

Sma≥t ﬁ≥ms lean on technology to cut ene≥gy consumption Safaricom says selection of machines that use less power helped it reduce electricity consumption even as it expanded its footprint

BY OKUTTAH MARK

wo years ago, telecoms giant Safaricom set out on a self-declared mission to reduce its energy consumption, cut costs and meet legal requirements set by the energy sector regulator. Besides chasing reduced spending, Safaricom had its eye on the Energy Regulatory Commission’s (ERC) newly-gazetted rules that required large power consumers to conduct an energy audit once every three years to trouble-shoot and seal leakages. The deadline for compliance with this requirement is September this year. Thibaud Rerolle, the technical director at Safaricom, says the assignment proved nearly impossible, coming at a time when the company, which is East Africa’s largest telecoms ﬁrm, had embarked on network expansion to reach new customers. “Cutting energy consumption while at the same time expanding and upgrading our footprint was a delicate balancing act,” he said. “The quality of our network is directly inﬂuenced by the availability of

Renewable

power. Any interruption of supply poses a direct challenge to the continuity of our operations.” This, as the operator moved into galloping infrastructure growth. In 2010, Safaricom had 1,972 base stations a footprint that by the end of 2012 had grown Base Station

The installation of solar water heating systems also helped the telecoms operator to comply with the energy-saving rules that were gazetted in 2012 requiring large commercial and residential buildings powered from the national grid to install solar water heaters. The directive is aimed at promoting the use of renewable energy and reducing over-reliance on the national grid. As a result of these moves, “our energy consumption is growing at a lower rate compared to our network growth. For example, we had anticipated that with increased demand our annual energy consumption would increase by 20 per cent, but, as we speak, this has gone up by only five per cent due to the measures we put in place,” said Mr Rerolle. Other measures put in place by Safaricom include the conversion of base stations from diesel under a partnership with Kenya Power (KPLC) and the Rural Electrification Authority. This has enabled the mobile operator to take swift advantage of extensions of the national grid and use it to supply its sites. In its annual Sustainability Report, 2014, the company reported that this had seen it connect 75 sites with low-voltage Auto Phase Selectors. An additional 203 units have been purchased and will be rolled out this year. “These units allow the sites to utilise grid power at voltages as low as 110V, which significantly reduces the instances in which generators run due to low voltages,” Safaricom reported in the Sustainability Report.

SAFARICOM’S NETWORK ENERGY SOURCES AS AT 31ST MARCH 2014 Energy classiﬁcation

Total

KPLC no Diesel generator

303

KPLC sites

2566

24/7 Diesel

Solar/wind

Power cubes

traditional generator hybrid

pure solar

Total

3056

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BUSINESS DAILY | Friday April 17, 2015

the edge: Managing for triple bottomline

Ties that bind: Wo≥kplace p≥actices that lock in talent

tle of the business district has helped staff to stay more focused and concentrate on what they need to do. This is in keeping with a trend that has seen several companies, especially multinationals, leave the busier Central Business District, with its older buildings, for newer premises in the outskirts of Nairobi. She says the company’s new home is environmentally friendly and aesthetically appealing, and the ample space available also gives staff freedom to work from anywhere in the building, increasing the connection between different departments. “Deloitte Place gives us far more superior facilities that greatly contribute to staff motivation and engagement. We now have three kitchens — one on each floor — a staff cafeteria, and an open air patio, where staff can enjoy the outdoors while having their meals. The patio has also afforded us the opportunity to host get-togethers” “The spacious office affords our staff the freedom to work from any part of the building or to ‘hot desk’ as we call it, without being restricted to fixed seating places in the traditional departments. This has greatly enhanced broader interaction among staff of different disciplines,” she said. Other buildings in the city that have adopted a mix of convenience and incorporated environmental considerations include the UN Environment Programme (Unep)offices at Gigiri and Coca-Cola’s regional headquarters in Upper Hill. The UN office was designed to use as much natural light as possible, and incorporates natural ventilation.

Productive

Research has shown that an ofﬁce with ample natural light and a green environment can bring in up to 10 per cent higher revenue per employee, with the number of sick days taken falling by a third compared to poorly lit and ventilated ofﬁces.

Why companies that offer extra amenities are more successfull at retaining valued employees BY CHARLES MWANIKI

fter working for his first employer for four years, Joseph Nkechi, a banker, got an offer from a rival bank to change employers at double his pay. It took him two months to make the decision – choosing to stick with his old employer, who immediately offered to match the rival bank’s offer. Mr Nkechi says he decided to stay put after conducting what he calls a 360degree assessment of his position -- beyond the monetary gains. Working in a specialised field such as risk analysis means Mr Nkechi is one of the few workers with skills for which

companies are ready to pay a premium. It is easy for a competitor to match the pay being oﬀered to your premium talent, meaning that a company has to ﬁnd that extra amenity to retain workers who would otherwise have little motivation to stay put. Without that, companies incur the steep costs of recruitment, made greater by the rigour required to avoid hiring the wrong person for the job. Yet one of the more disregarded factors by companies in the drive to retain and attract talent is the working environment, which comes into play di-

rectly when an employee is choosing whether to stay or leave the company for competitors. Research has shown that an oﬃce with ample natural light and a green environment can bring in up to 10 per cent higher revenue per employee, with the number of sick days taken falling by a third compared to poorly lit and ventilated oﬃces. Doreen Mbogho, a talent partner at Deloitte East Africa, says that the company’s move to a new building located outside town in a more serene area away from the hustle and bus-

The Coca- Cola building also has several features that include a green roof garden that acts as a recreation area, and which also ensures that there is minimal heat gain in a large portion of the building through the roof top. Improving air circulation in the office also helps ward off common infectious ailments that come with having many people in an enclosed area, such as common colds or flu, and keeps staff more energised during the day: especially in a tropical country like Kenya where afternoons during the dry season can become unbearably hot. In addition to a green working environment, staff retention and motivation also come from the extra amenities provided by companies, especially for new mothers and a younger generation of workers. Dorothy Ooko, Google’s communications manager for East and Francophone Africa, says the company follows this mantra in looking to create a healthy, happy and more productive work environment for staff. “We believe that the additional conveniences in the workspace do keep our employees happy and motivated, with things like on-site fitness and wellness centres. Wholesome lunch - and breakfast and dinner in some locations — is provided on-site daily,” said Ms Ooko. She added that some of the family benefits the company offers its staff include monthly baby showers for expectant parents, a return to work program for new mothers, and baby seminars. As the economy becomes more sophisticated, the demand for premium, specialised hard-to-get talent in sectors such as finance, medicine and the extractive industry will grow, perhaps outstripping supply. Against this backdrop, the success of a company in retaining their workers will very often come down to these value-add factors in the workplace.

Friday April 17, 2015 | BUSINESS DAILY

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the edge: Managing for triple bottomline

and instead of spending that money they want to pocket it.” Available DOSH statistics indicate that in the year 2010/11, 40 construction workers died, which is only second to public transport. In 2012/13, 31 people died from construction accidents. The recorded number of injuries for these years was 383 and 295 respectively. But the high number of unregistered workers in the country means the number of reported injuries or deaths in construction is only a fraction of the true number. In 2010, an estimated 330,000 people worked in the country’s construction sector, rising to about 420,000 in 2013. This sees Kenya’s accident losses compare unfavourably to more developed countries. Germany, for example, recorded 127 deaths among 2.5 million workers, Australia recorded 29 deaths among one million workers, while Sweden, with 306,000, saw 17 die from construction accidents. Mr Mbatha also points out that the casual nature of construction jobs, where workers may be on the site for a few days, makes them work longer hours magnifying the danger. A 2013 ILO working paper reports that casual workers are more likely to get injured due to this exertion and a lack of training on safety practices. “A casual worker is three times more likely to suﬀer an occupational accident than one with a permanent contract. While many permanent workers still lack training on occupational health and safety, this is more prominent for casual workers,” it states.

G≥eed, ≥ival≥y dent the safety ≥eco≥d of building secto≥ Industry data shows that contractors are capitalising on high level joblessness to breach set standards BY KIARIE NJOROGE

ompetition for jobs, and workers’ ignorance of the law have delivered a poor construction safety record in Kenya, even as the sector takes on an increasingly important economic position. The legislation on safety draws largely from international standards, including those set by the International Labour Organisation (ILO), but meeting them on construction sites has remained elusive. Many contractors have capitalised on the biting joblessness and workers who are unaware of the minimum safety standards to do away with the safety budget that is supposed to provide basic gear like helmets, safety boots, clothing, suitable scaﬀolding and insurance. “The major problem that we have with regard to safety and health in Kenya is ignorance. Some of them (workers) don’t even know of the

existence of the law,” said the head of the Directorate of Occupational Safety and Health Services (DOSH) Stanley Mbatha. “Even if one suﬀers an injury, they mostly don’t know where to go or what to do.” The industry is guided by two main laws; the Occupational Safety and Health Act; and the Work Injury Beneﬁts Act. These are supplemented by the Building Operations and Works of Engineering Construction Rules. Mr Mbatha adds that joblessness also means that workers are willing to forfeit the safety gear just to earn a living. “Safety come at a cost. In every contract document of these contractors, there is always an element of safety. But because of that (workers’) ignorance, most people tend to relegate safety issues to the back,” said Mr Mbatha. “The law says that there should be a budget for safety. Most of them (construction projects) have it, but people want to save on those costs

Risk It adds that this risk becomes greater in developing countries where the level of workers’ safety training and rights awareness training are lower. “Data from a number of industrialized countries show that construction workers are 3-4 times more likely than other workers to die from accidents at work. In the developing world, the risks associated with construction work are estimated to be three to six times greater in comparison to developed countries.” Injury benefits have also become institutionalised in the developed countries with insurance companies catering for medical bills and other compensation. In Kenya, some employers settle the medical bills, but do not offer any extra assistance despite the legal obligation to do so under the Work Injury Benefits Act that demands that they pay the medical bills and, in the case of partial or permanent disablement, pay compensation based on a formula and a schedule in the Act. The schedule assigns values based on the extent of the injury, with the loss of a finger, for example, valued at six per cent incapacity. Compensation is calculated as the percentage of incapacity, as assessed by a doctor, multiplied by total earnings per month, multiplied by 96. This means a worker earning Sh25,000 per month, for example, who loses a finger, would be eligible for a compensation of Sh144,000. The schedule assigns 100 per cent compensation for a death, pushing the payment to millions of shillings, an amount that is hardly paid in Kenya. While insurance would help defray such costs, contractors’ unwillingness to take up cover has left workers in a precarious position. At the same time, DOSH, as the enforcer of the standards, remains stretched, covering not only construction, but all work places in the country, while being understaffed and underfunded, and currently only present in 30 of the 47 counties.

Fi≥ms pay p≥ice of failing to keep employees safe BY EVELYN SITUMA

acchaeus Kombo’s life has not been easy since he was involved in a road accident in 2009. The father of five was ferrying 35 tonnes of sugar on his trailer from Mumias to Nairobi when, suddenly, the braking system failed and he crashed at a black spot in Salgaa. Luckily, he survived and was treated at War Memorial Hospital in Nakuru. However, the lorry and the sugar didn’t make it. Onlookers stole the bags of sugar, while the truck was written off. To add to it, Zacchaues spent 19 days in hospital and saw one of his legs amputated. The 45 -year- old says he survived by God’s grace. “I would be dead today,” he said during the interview. He faults the braking system for his fate. The system had always developed the same problem during his trips and his employer fixed it. But the problem persisted, and this time, it occurred on a slope, making it difficult for him to decelerate. “I wasn’t able to control it. The road was also under construction leaving me with little space to manoeuvre and veer off the road. But I think if the braking system had been replaced, the accident might not have occurred.” Zacchaeus and his employer, whom he didn’t want to reveal, are among thousands of casualties that suffer financial losses for failing to observe occupational health and safety guidelines.

Sacked The loss Zacchaeus incurred during and after the injury has cost him his entire livelihood. For starters, his injury consumed Sh150,000 in hospital bills. He also lost his leg and was sacked. Some of his children were not able to attend school for a while and his first born child is still at home with no plans of enrolling her for college education because he cannot afford the tuition fees. As a result, Zacchaeus has now been without a job for seven years. Last week, a friend invited him for a driver’s job, but he had to test his driving skills first. “Since the accident, I have been forgetful and also I often find my leg on the accelerator, instead of the brake.” His employer, meanwhile, lost his truck although he got the insurance, but also spent Sh109,000 on Zacchaeus’s medical bill and lost his consignment. The cost of litigation and damage to company reputation are other costs he accrued. Zacchaeus sued his employer in 2009 for wrongful dismissal. He won the case and the employer was ordered to pay him Sh1.2 million in damages. “I have never been paid the money, because he appealed the ruling,” Zacchaeus said. The case is still pending in court. Such are the losses staff and companies run into when they fail to invest in employee occupational health and safety. The US Department of Labour estimates that employers pay Sh93 billion ($1 billion) a week for direct worker’s compensation cost for work place injury and illnesses. The department lists medical expenses, legal services and workers compensation as direct costs. In Kenya, the actual figure is not known, though such cases are numerous. There are also indirect costs incurred like absenteeism, loss of property, repairs, investigation, quality of life and staff replacement and training.

BUSINESS DAILY | Friday April 17, 2015

the edge: Managing for triple bottomline

Compassionate employe≥s ha≥vest the f≥uits of healthy, happy wo≥ke≥s

THE HAPPINESS PREMIUM: There is evidence that employers of choice also tend to record higher proﬁt margins and productivity levels. FILE

Research shows that whereas investing in the social, physical and mental health of employees may not yield immediate tangible results, it is worthwhile in the long run

BY SARAH OOKO

onsolata Muthoni, a technology expert at a Nairobi-based, multinational company, had her first born son John Waweru, about a year after she had joined the organisation. Since the pregnancy was unplanned, she was constantly worried that being a mother too soon would interfere with the career growth she had envisioned. But when the baby eventually came, her employer was considerate. She got the usual three-month maternity leave, which she chose to combine with her annual one month of leave. When the baby developed complications and became critically ill, her boss did not mind having her away for another two months and gave her flexible working hours when she eventually came back. Five years down the line, Waweru is now a playful, healthy boy and her mother’s pride. “I could never be any happier!” Ms Muthoni says she will forever be grateful to her employer for having been there at the lowest point of her life when she even considered resigning for the child’s sake. Yet she has since pioneered technological innovations enabling the company to reap millions in profits, far more than it may have ‘lost’ during her periods of absence at work. Muthoni survived the ‘hard times’ thanks to an employer with a strong belief in the triple bottom line management approach, where the pursuit of economic gains does not surpass that of employees’ welfare. Research shows that whereas investing in the social, physical and mental health of employees may not yield immediate tangible results, it is worthwhile in the long run. Muthoni’s employer could have easily dismissed her and brought in a new employee had

Deloitte Best Company to Work For Competition Winners 2012

2013

2014

1st PlaceEABL

1st Place- Craft Silicon

1st Place- Procter and Gamble

2nd PlaceKWFT

2nd Place- Procter and Gamble

2nd - KWFT

3rd PlaceNation Media

3rd Place- KWFT

3rd Place- DHL

the company been using the bottom line approach where the only thing that counts is profit. This would have saved the company money in the short term. But it would have lost a skilled employee, and the profits enjoyed now would have gone to its competitors. Indeed, the World Health Organisation (WHO) underscores that embracing workplace health promotion programmes gives companies a positive and caring image. This consequently improves staff morale, hence increasing their productivity, whilst reducing employees’ turnover. Deloitte – a financial consulting and auditing firm - organises the Best Company to Work For competition, which relies on information given by employees of the participating companies to determine the winning organisations. Mr Kimani Njoroge, human consulting partner at Deloitte East Africa, says companies that emerge top in the competition are often those that have made strides in connecting with their employees through welfare programmes, taking care of their mind, body and soul. “These companies look after the overall health of their employees thus creating a happy work force that will help them achieve their objectives. And this definitely pays off.” He adds that

companies recognised as ‘employers of choice’ also tend to record higher profit margins and productivity levels than their counterparts. The Kenya Women Microfinance Bank (KWFT) has stayed on the Top three list of the competition for three years since 2012. As one of the leading microfinance institutions in the country, the bank attributes the success to its heavy investment in the wellbeing of employees. Mr Mwangi Githaiga, KWFT managing director, notes that employees are a strong pillar of the organisation and hence need to be continuously motivated so that they can maintain the passion and interest they have in their work. “They should feel that they belong to this organisation and that the employer values them; that even if they fell sick, someone would care.” To this effect, KWFT has invested in one of the best medical schemes in the country that is uniform for all employees - from the cleaner to the chief executive officer.

Equal All its staff enjoy the same healthcare facilities and health premiums, irrespective of the positions they hold in the organisation. “This approach brings unity to the organisation, because at the end of the day we are all equal. It’s only that those at the top have more responsibilities than others,” explains Mr Githaiga. The scheme covers outpatient, inpatient, dental and optical services for all employees, their spouses and three children. It also caters for maternity expenses to safeguard the health of mothers in the organisation. Members of staff also enjoy a personal accident and life cover. In case any of the employees dies, their beneficiaries receive financial compensation and KWFT takes care of all funeral expenses As an organisation whose mandate is to empower women, KWFT has put in place strong structures to allow women to enjoy motherhood and family life without necessarily compromising their careers. For instance, expectant women get flexible working hours before and after delivery. Lactating mothers have a special room where they can express breast milk comfortably and store it in a fridge, as this improves the health of their babies. It is this passion for employee welfare that saw KWFT rated, in 2011, as the Best Microfinance Institution Globally with regards to women’s empowerment at the work place. “This was because we not only take care of women from the career point of view, but also from the health one, “said Mr Githaiga. This ideology follows a global trend, with renowned profitable multinational companies showing the world that it definitely pays to pursue profits, while at the same time investing in the health of employees. Take Google for example, which for the first time emerged top in the 2015 Forbes Best Places to Work In list despite having featured on it over the years. So what was the secret behind this sudden leap in success? “Google stepped up their game in support of work-life balance and families. It increased maternity leave, increased paternity leave and reworked onsite day care. They’ve really made an effort to allow people to have strong families as well as give their best to Google. That came through loud and clear and seems to be what pushed them over the edge this year,” said Robert Hohman, CEO of Glassdoor, which selects the winners in the annual Forbes Best Places to Work In competition.

Friday April 17, 2015 | BUSINESS DAILY

XXI

the edge: Managing for triple bottomline

By-p≥oducts that yield new lines of sustainable goods Recycling ensures that nothing goes to waste in the country

BY SANDRA CHAO-BLASTO

utting waste and hazards by turning by-products into goods in their own right is a sustainable business that is gathering force, with Kenya now having its own top ten ‘sustainable’ goods.

1. Water hyacinth Water hyacinth is being used by local women’s groups to make furniture and handicrafts, including woven baskets and laptop bags. The weed is also being turned into parchment and other high quality paper using Japanese paper making technologies from the 6th century. The Kenya Organic Research Centre for Excellence, plans to generate power by harvesting hyacinth and feeding it into a bio-digester that will in turn produce gas to drive turbines that will produce 120MW of electricity for the national grid. Local investors in Naivasha are additionally now looking into harvesting the weed to make organic fertilizer as a commercial venture

2. Recycled plastics

Felistas Asiko drying cylindrical charcoal briquttes in Kibera slum. FILE

Several companies have come up with ways to recycle this waste. Ecopost Ltd is recycling plastics into lumber, an alternative to timber to make fencing posts, shipping pallets, road signage and even outdoor furniture. A-One Plastics Ltd also creates solid plastic posts from polythene waste, as well as making new seedling bags, polythene sheets and tubing. Individual innovators have additionally come up with machines that help in recycling plastics. An innovator in Nyeri has made a plastic shredder that produces kerosene, wax and hydrocarbon for making fertilisers from water bottles and other plastic wastes that do not contain chlorine. A university lecturer from JKUAT has created a pyrolytic reactor that converts polythene waste into combustible gases for direct heating or electricity production. The machine can handle up to ten tonnes of plastic every day.

Products made from old slippers at the Flip Flop Recycling Company at Marula Studios in Karen, Nairobi. FILE Allied Industries Limited (Kasil) is planning to use the ﬁbrous matter called bagasse to make paper in Kisumu. Commissioned in December 2007, the sugar miller has a capacity to mill 480,000 tonnes of sugar per year. Kasil has invested Sh1.1 billion in setting up the ﬁrst treeless paper milling factory in the land opposite their sugar factory.

3. ‘Biodegradable’ sanitary towels Young innovative students from JKUAT have used various chemicals to extract cellulose from small bundles of dried papyrus reeds, banana stalks, rice straw and water hyacinth. The cellulose is then used for making super-absorbent polymers for diapers and sanitary pads, which are put in non-woven cotton fabrics to come up with the ﬁnal products.

4. Green pencils An entrepreneur in Juja has found a way of converting paper back to wood. Green Pencils Limited makes high quality environment-friendly branded pencils and pens from recycled newspapers. Old newspapers fare taken through an 18-step process to come up with the ﬁnished product. The green pencil consists of layers of papers wrapped tightly around the graphite to make it look like an ordinary pencil. The company estimates that one person can make 150 pencils a day and 2,400 people can make 100 million pencils in a year creating a viable opportunity to tackle unemployment. A display of household equipment ma of hyacinth. FILE

5. Bagasse paper The waste from sugar manufacturing is managed differently by the various companies. Kibos Sugar and

6. Briquettes Making ‘green charcoal’, has the double beneﬁt of providing a source of fuel as well as getting rid of waste, since briquettes can be made from sawdust and agricultural wastes like coconut shells, coﬀee and rice husks, cassava and banana peelings, sugar cane waste or maize cobs. The briquettes provide more fuel than using ordinary charcoal and one can cook more food than with the same amount of charcoal . A manual briquette-making machine costs between Sh10,000 and Sh20,000 while a motorised one goes for between Sh80,000 and Sh300,000.

8. Receipt paper rolls Receipts often end up as litter on the streets, or are thrown into trash cans by people kind enough to carry them home. Supermarkets, especially those within major cities in the country, serve a large number of people on a daily basis using huge rolls of paper to produce the receipts. As part of their extension from retail into manufacturing, some supermarkets have now ventured into producing their own branded tissue paper recycled from the waste paper collected.

9. Recycled glass Glass recycling is widespread, as established and budding companies alike turn it into more useable forms. Kitengela Glass, transforms recycled glass into art work, jewellery, and home décor. Broken glass and unused bottles are cut and melted in a furnace into the new glass. Stained glass windows are found in various churches while art sculptures and mosaics have made it to oﬃce buildings and palatial homes. On a smaller scale, individual entrepreneurs are recycling glass into ﬂower vases, table side lamps and even chandeliers.

7. Flip flop art Old sandals are often ‘recyled’ when used by adventurous boys to make tyres for toy cars. UniqEco, now called Ocean Sole, recycles old rubber sandals into beautiful art products. On an annual basis, the company recycles 400,000 flip flops, many of which are collected along the shores of the Indian Ocean. The flip flops are used to make goods ranging in size from small to life size animals, Christmas tree decorations, key rings, doorstoppers, pen tops and bracelets.

10. Concrete paving blocks Cabro blocks were created as a way to recycle waste by cement manufacturers. Bamburi Cement pioneered the concrete paving solution. Today, the manufacture is not limited to cement factories, independent businesses are purchasing cabro blockmaking machines and creating diﬀerent designs for ﬂooring of patios, outdoor pathways and even to replace tarmac in some lanes,

XXII

BUSINESS DAILY | Friday April 17, 2015

the edge: Managing for triple bottomline

Ent≥ep≥eneu≥s ﬁnd wealth in piles of e-waste New channels of collecting and disposing of electronic waste offer youths opportunities of employment BY GEORGE NGIGI

n 2008, Summit Strategies lead consultant Muriuki Mureithi partnered with Prof Timothy Waema of the University of Nairobi to research e-waste management in Kenya. The study suggested total e-waste generated from computers, monitors and printers already stood at some 3,000 tonnes a year, and was expected to increase rapidly as importation and use of computers rose. “It was a growing menace and really nobody had thought of it,” said Mr Mureithi. The study set out to deﬁne e-waste in Kenya, address who needed to be involved in tackling the issue, and estimate its volume, so as to know its impact. But “what we wanted to see is happening now, with private players coming on board,” said Mr Mureithi. An early entrant was international electronics company, HP, which in October 2011 opened the East African Computer Recycling (EACR) in Mombasa in partnership with Camara Education, an NGO working with the disadvantaged in “Education through ICT”. EACR has since changed its name by replacing the word ‘computer’ with ‘compliant’, underlining the widening scope of electronic waste.

Health Two years later, HP set up its ﬁrst centre in Nairobi, and has since opened another 40 centres, now employing more than 2,000 people. The rapid roll out of the centres has been accompanied by burgeoning growth in electronic waste, across mobile phones, computers and household equipment – which had been left out of the initial research. Moreover, in a country where electronic gadgets are bought not only for their core use, but as a symbol of status, disposals are set to continue rising. “E-waste in Africa is growing 20 per cent a year due to rising sales of electronic goods and legal and illegal imports of second hand and surplus equipment,” Dr Kirstie McIntyre, the head of environment compliance at HP is quoted as

The d≥aft Bill on managment of elect≥onic waste ≥ecommends the ≥egist≥ation with Nema of all institutions intending to int≥oduce new o≥ used elect≥ical and elect≥onic equipment into Kenya. The institutions will be ≥equi≥ed to sign cont≥actual ag≥eements with a licensed ≥ecycling facility. saying in the company’s website. The electronic products are made of metals and chemicals such as lead, mercury, copper, barium, and nickel. When covered in plastic containers, the components are not dangerous, but tend to break and be exposed when the product is being thrown away. Many of these chemicals and metals are known causes of serious health conditions, including cancer, diabetes, impaired cognitive function, and damaged organs. Last year, these initiatives saw HP win the Guardian Sustainable Business Award for its eﬀorts in tackling e-waste in Kenya. Dennis Onyango, who operates a collection centre in Mukuru, says the range of material his centre collects includes TVs, phones, iron boxes, computer monitors and motherboards. Mr Onyango has 55 trained collectors at the centre, 34 of them active. The Catholic University graduate with a degree in public health and social science associated with Slovakia’s St Elizabeth University said he ﬁlls a container in a week. Before he opened the centre he received special training on e-waste management from England’s University of Northampton. He is now charged with training the collectors on their protection. The collectors are supplied

with protective gears and a letter of introduction that eases their access to institutions that have waste to dispose. The waste collected at Mr Onyango’s centre is then forwarded to a godown at Athi River where it is sorted out for recycling. Material that cannot be recycled locally are shipped out of the country for further processing. The managers of the collection centres and the individual collectors are paid from the value created from reusing the e-waste. Collectors earn up to Sh5,000 a month from deliveries made to collection centres. Elsewhere, telecoms giant Safaricom has put bins in its oﬃces for individuals looking to dispose of their mobile phones responsibly. HP has also been working with National Environment Management Authority (Nema) to create regulations governing the management of electronic waste. Draft regulations released in 2013 are yet to be passed into law, but the regulations will ban the disposal of e-waste by burning, putting in non-designated waste receptacles, burial or leaving at a dump site. The draft bill recommends the registration with Nema of all institutions intending to introduce new or used electrical and electronic equipment into Kenya. The institutions will be required to sign contractual agreements with a licensed recycling facility. Companies will also be mandated to declare the electrical and electronic equipment introduced into the market by product type, and projected imports for the next year. Some e-waste does not have a positive recovery value, with the cost to processing being more than the revenue recovered. As a result, currently, these materials may not be collected. The regulation aims to get recyclers paid to take these materials, to ensure collection. “The recycler will recover these costs from the producers based on their market share of the respective category of products. This will prevent the ‘cherry picking’ of only valuables,” reads part of the Bill.

G≥een climbs the co≥po≥ate ladde≥ one ≥ung at a time

he US state of Delaware recently passed a statute allowing incorporation of hybrid companies dedicated to doing good while also making money. Officially called benefit corporations, the special corporate structures they adopt appeal to people who “want to devote significant energies to solving social or environmental problems as well as making a buck,” says Eric W. Orts, a professor of legal studies and business ethics at Wharton. Benefit corporations open up a way to “address social and environmental issues with sustainable long-term profit-making,” he adds. While some 19 states allow for hybrid corporations, Delaware’s move is a benchmark because more than half of all large US public companies are incorporated there, including some two-thirds of the Fortune 500. Without a special law to allow the dual goals, a company could fail to meet its fiduciary responsibilities. Traditional corporate and business organization KNOWLEDGE @ law tends to WHARTON assume “the primacy of a ‘for-profit’ objective,” Orts says. “Shareholders can sue if a company begins to devote too many resources to projects not intended to maximize returns, at least in some states.” So the hybrids fall between more typical for-profit and non-profit companies. “Clarity of purpose and legitimacy are the main gains of new legislation – and some protection from possible litigation.” One good example of a benefit corporation is Patagonia. Its company message is that it does not compromise environmental values when it is making and selling clothes and outdoor equipment, says Orts, who is also director of Wharton’s Initiative for Global Environmental Leadership (IGEL). The company has devoted tens of millions of dollars to environmental causes, and “its brand is based on what it does and stands for environmentally, as well as basic quality and cost variables. Many customers are happy to pay a premium for this kind of commitment.” According to B Lab, a non- profit group that tracks the evolution of these hybrid corporations and operates the Benefit Corp Information Centre, “benefit corporations offer clear market differentiation, broad legal protection to directors and officers, expanded shareholder rights and greater access to capital than current alternative approaches. As a result, the benefit corporation is also attracting broad support from entrepreneurs, investors, legal experts, citizens and policy makers interested in new corporate form legislation.” B Lab maintains a list of companies registered as benefit corporations.

Friday April 17, 2015 | BUSINESS DAILY

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the edge: Managing for triple bottomline

Wo≥ld pays high p≥ice fo≥ co≥≥uption pany did this ostensibly to attract shareholders and finance, with its shares were listed on Wall Street. Key management officials including the corporation’s CEO Jeffrey Skilling continued with this deceiving tactic formulated by a Chief Finance Officer Andrew Fastow in 1998 to woo unsuspecting investors, hence profiting themselves. Overwhelmed by guilt over the con game, Fastow resigned from the company a few months later, the Security Exchange Commission (SEC) noticed a discrepancy in the corporation’s accounts and investigation ensured. It was finally revealed that the company had accumulated $591 million and $628 million in losses and debts respectively. The Barclays Bank Libor scandal, where staff at the bank repeatedly made false financial submissions to manipulate the London Interbank Offered Rate (Libor) is another perfect example of how fraud can be cultivated in a corporate entity trusted by millions of clients across the globe With the Libor rate used as the benchmark for trillions of loans, mortgages and financial products traded around the world, Barclays hatched a plan with other banks in Europe and America to inflate the rates in order to pass the heat to consumers. The bank management later told its staff to tell clients that they could borrow at lower interest rates than they could, in order to show the bank in a better light than it actually was, in a bid to edge its competitors out and hence create additional profits. This plot was, however, revealed when other banks complained of sky rocketing base lending rates by Libor, prompting an investigation. Corruption mainly hurts employees’ morale, business relations, brand reputation, relations with regulators and share prices.

Integrity

FILE

From utter theft of funds by public ofﬁcials to fraud and accounting deception in private companies corruption is wiping out proﬁts, killing jobs and threatening the future of businesses

BY VICTOR AMADALA

orruption is costing more than five per cent of the world’s Gross Domestic Product (GDP), or some $2.6 trillion a year, according to the World Economic Forum, with over $1 trillion paid in bribes, adding some 10 per cent to the global cost of doing business, and up to 25 per cent to procurement costs in developing countries, including Kenya. And although most anti-graft crusaders, including Transparency International (TI), pay much attention to government agencies, private firms, which provide more than half of the world’s jobs, are dying silently on the back of fraud and corrupt deals perpetrated by both senior and junior staff.

Crimes A recent study by PricewaterhouseCoopers (PwC) identified accounting fraud and bribery as the main crimes perpetrated by private sector staff. In Kenya, the two vices accounted for 38 and 22 per cent of the reported economic crimes. Such crimes have even brought some of the world’s largest corporations to bankruptcy, a case in point being the Enron Corporation, an American energy, commodities and services firm that was driven into bankruptcy in 2001 courtesy of systematic internal theft and creatively planned

A ≥ecent study by P≥icewate≥ house Coope≥s (PwC) identiﬁed accounting f≥aud and b≥ibe≥y as the main c≥imes pe≥pet≥ated by p≥ivate secto≥ staﬀ. In Kenya, the two vices accounted fo≥ 38 and 22 pe≥ cent of the ≥epo≥ted economic c≥imes.

accounting fraud now known in economic circles as the Enron scandal. Enron, which had employed close to 20,000 staff with claimed revenues of about $111 billion, was named by the Fortune magazine as America’s Most Innovative Company six consecutive times up to year 2000, only for it to collapse a year late. In an outstanding accounting deception, the company’s management, for instance, would build an asset such as a power plant and immediately claim the projected profit on its books, even though it hadn’t made one dime from it. If the revenue from the power plant was less than the projected amount, instead of taking the loss, the company would then transfer these assets to off-thebooks, where the loss would go unreported. The com-

Beyond being fined $450 million by the Financial Services Authority (FSA), Britain’s banking regulator, the bank’s integrity was put at stake, lowering investors and clients confidence. The bank’s top management, including the CEO Bob Diamond, Chief Operating Officer Jerry del Missier and Marcus Agius, the Chairman, were all forced to resign. In Kenya, many companies have suffered from fraud, often perpetrated by top management. According to international audit firm Ernst and Young’s report, released late last year, more than a quarter or 27 per cent of the chief executives, financial controllers and internal auditors surveyed in Kenya cited high levels of fraud in their companies, only lower than 44 per cent in Egypt, 30 per cent in Nigeria and 28 per cent in Namibia. The survey did not reveal the amount of money paid out as bribes to win contracts or lost in fraud, but the auditors said it was futile to ask, because of rampant understating. They, however, estimated that companies lose between seven and eight per cent of their revenues to the two vices, translating to the loss of thousands of jobs every year. Recently, an audit by KPMG revealed how top managers embezzled funds at Mumias Sugar, leaving the company on its financial knees. Indeed, a PwC 2014 study revealed that corruption mainly hurts employees’ morale, business relations, brand reputation, relations with regulators and share prices. Some 36 per cent of firm executives sampled during the study blamed corruption for poor production by employees, while 38 per cent said it stains company’s relation with other stakeholders. A further 16 per cent claimed that corruption erodes a brand’s reputation, while 15 and 3 per cent said that the vice stains the company’s relations with regulators and affects the market share of the products produced by the company. -AFRICAN LAUGHTER

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BUSINESS DAILY | Friday April 17, 2015