Safaricom has been ranked the 10th most valuable firm on the continent in a ranking dominated by South African companies.
South Africa-based African Business disclosed in a ranking of the continent’s top 250 firms that Safaricom had climbed from position 14 last year.
Only four Kenyan-based firms, including East African Breweries Limited (EABL) , Equity and KCB Group , were ranked among the top 100 most valuable companies in Africa.
In the ranking, which is based on a firm’s market capitalisation at the end of March, Equity Bank was ranked at position 82, followed by EABL (90) and KCB Group (92).
Safaricom’s market value was placed at $9.96 billion (Sh1.06 trillion) compared to Sh12.74 trillion of South Africa’s technology firm Prosus—which is the continent’s most valuable firm.
The top seven most valuable firms are from South Africa, underlining its economic dominance in the continent on the back of its mining and financial sectors.
Safaricom and Morocco’s telecom giant, Maroc Telecom, were the only firms outside South Africa ranked in the top 10.
But the East African region is still the continent’s most attractive investment destination based on capital gains, according to the survey.
“Some of Africa’s most attractive investment destinations are found in the East. But this did not stop the region’s share of the Top 250 ranking falling from 21 companies totalling $26.3bn (four percent of total market cap) last year to 17 entries totalling $20.2bn (3.4 percent of the total) this year,” the report notes.
“South Africa’s share of the Top 250 Company ranking continues to slip back because other African markets have been growing more strongly – at least before the crisis hit. South Africa now has 100 companies on the list, down from 109 in 2019,” the report states.
Kenyan firms remain dominant in East Africa. Ugandan firms missed out in the top 100 ranking while Tanzania had two firms—Tanzania Breweries Limited at position 75 and Vodacom Tanzania (98).
Safaricom’s dominance of the Nairobi Securities Exchange (NSE) has hit a new peak after the telecommunication firm’s market valuation exceeded 50 percent of the Sh2.06 billion Nairobi bourse. Safaricom’s valuation of Sh1.1 trillion at close of trading Monday is now 53.3 percent of total investors’ wealth on the NSE Nairobi Securities Exchange, a factor that is largely attributable to the bear run that has precipitated a sharp drop in the market capitalisation of other listed firms.
Being above the 50 percent threshold means that Safaricom’s market worth is now more than the combined valuation of all the other 62 listed companies.
The firm is still shy of its highest-ever market capitalisation of Sh1.27 trillion it achieved in March 2018, but the company has avoided the deep erosion of value that other companies have suffered in the wake of coronavirus-driven losses, pulling down the benchmark NSE 20-Share Index to a 16-year low.
The telco’s share price has gained 1.3 percent over the past month to hit Sh27.65. The firm together with EABL, Equity and KCB Group, account for 80 percent of NSE firms’ valuation
The Capital Markets Authority (CMA) regularly flags the influence the top firms have in terms of traded activity and investor wealth as a market risk.
Safaricom’s net profit for the full year ended March this year jumped 19.54 percent to Sh74.7 billion on strong M-Pesa and mobile data revenue growth that offset a decline in voice and messaging (SMS) revenues.
Credit: Business Daily
Zimbabwe’s state power transmission company has invited bids for the construction of 500 megawatts (MW) of solar power plants as part of a drive to increase its use of renewable energy and end power cuts.
The southern African nation since last year has endured cuts, known locally as load shedding, lasting up to 18 hours after a devastating drought reduced dam levels at its hydro plant while ageing thermal stations constantly break down.
Supplies have improved since the country entered a coronavirus lockdown at the end of March, forcing industry to close.
Zimbabwe also paid off arrears to South African power supplier Eskom, guaranteeing supplies of up to 400MW daily.
Zimbabwe is currently producing 987MW of electricity daily.
“The Zimbabwe Electricity and Distribution Company (ZETDC) is intending to contract 500MW of PV solar plants of varying capacities at different identified strategic locations,” the company said in a public notice.
ZETDC said solar power would help mitigate against climate change-induced risks and reduce imports, saving scarce foreign currency.
Zimbabwe’s largest hydro station Kariba has a capacity of 1,050MW but is only producing 600MW due to low water levels.
The decision by Prime Minister Abiy Ahmed to postpone the elections in Ethiopia has created a constitutional crisis. The COVID-19 pandemic is the context for this but not the cause.
The Ethiopian government decided to postpone the scheduled elections for an unlimited time as a result of the pandemic. But this extension comes with a unique problem, what the authorities are now calling a constitutional crisis.
The five-year term of the federal and regional legislatures, as well as their administrations, will expire on September 30. This brings about a distinct challenge.
Beyond September 30, who will have the mandate to govern until an election can be held?
The ruling party presented four possible scenarios to circumvent the constitutional crisis: dissolving parliament; declaring a state of emergency; amending the constitution; and seeking a constitutional interpretation.
Of the four options, the ruling party was partial to constitutional interpretation. Parliament endorsed this on May 5, 2020. They have asked the House of Federation to issue an interpretation within a month. Most opposition parties with significant constituencies have rejected the decision.
The Oromo Federalist Congress and its six coalition parties have rejected it and called for a dialogue to find a political solution. The Tigray People’s Liberation Front rejected it as unconstitutional and said it would prepare for regional elections. It said this would avoid an illegitimate power grab by the incumbent.
In Ethiopia’s divisive ethno-political landscape, this year’s planned elections were always going to be a tricky affair.
Was the current impasse avoidable?
The National Electoral Board of Ethiopia was reorganised in 2018. Former opposition leader Birtukan Midiksa was appointed as its head. Despite these developments the government remained reluctant to hold elections on schedule.
Prime minister Ahmed stated that his government needed to consult all the political groups in the country to decide whether holding the election on time was appropriate.
In its most recent report, the International Crisis Group indicated that Ahmed’s tactics were reminiscent of the authoritarian past he had vowed to abandon. This included the arrest and harassment of activists and opponents.
It was only in October 2019 (following the Nobel Committee’s announcement that Ahmed had won the Nobel Peace Prize) that the premier stated explicitly that any delays in the poll would affect the legality and legitimacy of his government.
The electoral board and its new chairperson claimed that they had begun working on preparations for elections. However, an election timeline was only released in February this year. This goes contrary to custom whereby the board should have announced the calendar nine months prior to polling day.
In the February calendar, it planned to hold the elections on August 29, 2020.
Several organisations and political groups expressed their concern about the choice of date. Because of the rainy season, most rural areas are not accessible at that time. This would limit the participation of the majority of Ethiopians. The electoral board insisted on going ahead with the August date, claiming that any delay would result in a constitutional crisis because an un-elected government would be in office.
From this sequence of events it is clear that the constitutional crisis was already brewing before the additional problems posed by COVID-19. The late preparations and unrealistic choice of date already posed a very serious problem to the practicality and legitimacy of the elections. COVID-19 gave the government a golden opportunity to justify further delays.
The way forward
Analysts who follow Ethiopia closely, for example Rene LeFort – a writer, reporter and author of Ethiopia: An Heretical Revolution? – have indicated that Ahmed is increasingly personalising power. They say he has shown his aspirations to become the “big man” of Ethiopia at any cost. This would include operating outside the legal framework if necessary.
The Abiy administration has reversed early gains that were made by opening the political space. The resumption of intimidation and mass incarceration of opponents point to a return to the old authoritarian days. His regime is failing to deliver on its promises and is quickly losing its legitimacy.
When it dissolved the ruling Ethiopian People’s Revolutionary Democratic Front and replaced it with the Prosperity Party it arguably abandoned its legality. The Prosperity Party only has the façade of legality because the representatives who were elected under the front irregularly assumed Prosperity Party membership.
The postponement of the poll without proper political settlement could be the last straw. The country is at risk of balkanisation along ethnic lines.
The Tigray region has declared that it will go ahead with its regional elections. Neither the electoral board nor Ahmed’s government can legally stop the Tigrayans from holding elections.
Any attempt to stop the election by force could split the Ethiopian army along ethnic lines. Such an attempt could be a recipe for the Tigrayans to invoke article 39 of the constitution and declare an independent state. Several major opposition groups, including the largest coalition of Oromo national organisations, have also declared they might go it on their own beyond September 30. They refuse to recognise an illegitimate government.
The solution, therefore, is more political negotiation rather than constitutional “interpretation”. None of the provisions in the constitution, however much they are stretched for convenient interpretation, allow for the extension of the incumbent’s mandate beyond September.
An agreement on the poll date, as well as the type of provisional administration to bridge the gap between September and the next election, can only come through dialogue between all political parties and key civil society organisations. Anything less could spell the most severe crisis in Ethiopia’s modern history.