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The East African : Jun 28th 2015
48 JUNE 27 - JULY 3, 2015 BUSINESS, MARKETS AND FINANCIAL ANALYSIS THE MARKET WHISPERER EQUITY MARKETS (WEEKLY CHANGE IN BENCHMARK INDEX) NSE 20 Share Index Kenya 4,810.36 0.66% (CUMULATIVE MOVEMENT) DSE All Share Index Tanzania 2,805.12 -1.58% USE All Share Index Uganda 1,984.00 -2.27% RSE All Share Index Rwanda 135.65 -0.12% JSE All Share Index South Africa 52,726.53 1.78% NGSE All Share Index Nigeria 32,776.84 -1.45% ($30 million) to electricity distributor Umeme as compensation for losses caused by public departments not settling their bills and delays in tariffs adjustments. Official documents show that the government owed close to $20 million in unpaid bills to Umeme in 2013 alone. Overall, Umeme with- drew $10.5 million from its escrow account, out of which $897,000 was to cater for the losses incurred over the Electricity Regulatory Authority’s failure to approve the 2013 retail power tariffs. The balance was to offset unpaid electricity bills by government departments. “The government has re- mitted over Ush100 billion to cover the money owed by various departments to Umeme. A portion of this money will go back into the escrow account,” said Henry Rugamba, Umeme’s spokesman. The Electricity Regula- tory Authority (ERA), however, said it had been ap- Umeme gets $30m compensation ove≥ bills U ganda has paid more than Ush100 billion including government nonpayment of electricity bills and ERA’s non-compliance with the terms of Umeme’s electricity licence establishing the retail tariff. Under this agreement, Uganda Electricity Distribution Company Ltd (UEDCL) is obliged to fund the escrow account to the tune of $20 million. However, the escrow account is currently not being funded since the lease payments to UEDCL, which were formerly used to fund the account, have been excluded from retail tariffs by ERA. “If this lease fee is fac- The Mpererwe Umeme substation in Kampala. Picture: File proving the adjustments on schedule. “Umeme has never withdrawn funds from the escrow account on account of failure by ERA to approve a tariff. We do tariff adjustments on a quarterly basis. But tariffs are approved to recover reasonably and prudently incurred costs by utilities, not anything else,” said ERA spokesman Julius Wandera. Leading the list of defaulters is the Ministry of Defence, which owes $9.6 million. Other government min- istries and departments with outstanding debts are the Uganda Police Force with a $5 million unpaid bill, Uganda Prisons Services with $3 million, the Ministry of Health with $807,000, the Uganda Broadcasting Corporation with $746,000 and National Referral Hospital Mulago with $568,000. While parliament had recommended that the culprits replenish the escrow account in addition to paying any outstanding balances, it has emerged that the Treasury has already cleared the bills. The escrow account was established under the lease and assignment agreement to compensate Umeme in the event of contingencies, tored back in the tariff just to cover for government offices that don’t pay their power bills, electricity consumers will be paying for these institutions that are not paying their bills and the end user tariffs will be higher than they already are,” said Mr Wandera. As an alternative, the legislators demanded that Umeme install prepaid meters in all government installations within three months, and where possible install solar panels. Kenya’s e-govt on the spot ove≥ p≥ocu≥ement scandal KENYA’S ELECTRONIC procurement system is under investigation following an attempted fraud of Ksh826 million ($8.23 million) of funds belonging to the National Youth Service (NYS). But even as concerns rise over the exposure of the newly established online procurement system, the government has maintained that it will not honour contracts executed manually. The country is set to carry out an audit of all procurement processes performed by ministries, departments and agencies as part of efforts to enhance compliance with the online procurement system. National Treasury Cabinet Sec- Funds targeted in attempted fraud on Kenya’s National Youth Service $8.23m retary Henry Rotich told The EastAfrican that government suppliers still tendering manually will not be paid for goods and services delivered. “We need to assess exactly which ministries have done procurement outside the e-procurement system,” said Mr Rotich. The Integrated Financial Man- agement Information System (IFMIS) that drives the electronic procurement system is at the centre of the hacking scam at the NYS. Cybercrime investigators have been brought in after insiders allegedly hacked into the system. IFMIS, one of the flagship projects of the ruling Jubilee coalition, is a central computerbased system and the only avenue through which to incur expenditures for the entire government. The system was launched by President Uhuru Kenyatta last August in an effort to improve efficiency and eliminate corruption. Published at Nation Centre, Kimathi Street, and Printed at Mombasa Road, Nairobi by Nation Media Group, Box 49010, GPO Nairobi, 00100. Registered at the GPO as a newspaper. Nairobi Office, Tel: 3288000, 211448, 337710, Fax 214531, 213936. Dar es Salaam Office. Tel: 2119657/8. Kampala Office, Tel: 232771, 232772. Fax 232781 Download free QR Readers from the web and scan this QR (Quick Response) code with your smart phone for pictures, videos and more stories Agoa in 15-yea≥ extension THE US Congress has finally voted to extend the Africa Growth and Opportunity Act (Agoa) by 15 years, giving President Barack Obama something to brag about on his visit to Africa. “After years of tireless work and effective advocacy, the Congress work to reauthorise the AGOA is now complete,” said US Congresswoman Karen Bass. The renewal and extension of Agoa is expected to give African countries ample time to build competitive capacity in the global market. It accords preferential market access to 39 countries in sub-Saharan, Africa to develop their economies and create free markets. The initiative was signed into law in 2000 to allow African countries to export a more than 6,000 products to the US dutyfree. “Agoa has been called the ‘cornerstone’ of the US-Africa economic relationship, and on this stone we will build an even more lasting and stronger commitment,” said Ms Bass.
Jun 21st 2015
Jul 5th 2015