The year 2010 in numbers

By Kenneth Kwama

The New Year is days away. And factoring this year’s closing numbers, 2011 promises to be an exciting year, but before it really starts, the Financial Journal looks at 2010 facts and numbers. We collected heaps of numbers to trace out what has happened during the year.

The recession largely fuelled by the post election crisis of 2008 and drought effects officially ended in June last year, but it sure doesn’t feel that way for many Kenyans negotiating high unemployment, stagnant job growth, and depressed international prices for agricultural produce.

The greater sting for those struggling: Census data shows that the income gap between the rich and the poor is wider than ever. In this not-quite-recovery, tales of big paydays for a fortunate few continue to make headlines, as the have-nots watch from the sidelines.

But, as the Kenyan worker faces a long, dispiriting journey to prosperity, it will all depend on how well the country sustains recent growth as shown in the closing numbers of 2010.

This year will be remembered as a year of mixed fortunes for businesses. It started on a quieter note, but began picking up in the second quarter of the year. By July, a key economic indicator-the Gross Domestic Product (GDP),— which measures goods and services produced by a country, had started growing at a phenomenal 6.1 per cent.

So here is the breakdown:

Population: 38.7 million

Minister of State for Planning, National Development and Vision 2030 Wycliffe Oparanya the Population and Housing Census.

Before the census results, the common assumption amongst businesses was that Kenya’s population stood at between 40 and 41 millions people. The results showed that the country’s population is a massive two million people shy of that assumed figure— 38.7 million.

Sh3: calling rate

The mobile telecommunications market started witnessing the Indian business model of low margins and high volume, when Bharti Airtel announced drastic price cuts for subscribers on the Zain network.

The launch of Sh3 flat calling rate from Airtel (formerly Zain) to all other networks was a clear testimony that the Indian mobile communications giant was aggressively targeting to recruit more subscribers to its network.

Zain Kenya Managing Director Rene Meza said the move was part of the operator’s business model targeting the mass market as well as making mobile services more accessible to subscribers. This saw all the other operators, yu, Orange and Safaricom, calling rates average Sh3.

NSE Index: 4,361.27

The benchmark NSE 20 share Index was up 35.19 points yesterday, a rise of 0.81 per cent. This saw index settle at 4361.27, while the broader All Share Index (NASI) gained 0.16 points, or 0.17%, to close at 96.84. The market capitalisation stood at Sh 1,151.01 billion.

Looking at the period between January 2009 to November 2010, the market was up in the month of August 2010 and low in February 2009. Currently, year-to date annual equity turnover for 2010 stands at Sh104 billion, representing a 171 per cent increase when compared to 2009 value.

Bond turnover for last year’s (January to November) stands at Sh460 billion compared to 2009 annual turnover of Sh110 billion, representing an increase of 316 per cent. From November 2009, we noted a high of Sh 95 billion in June this year and low of Sh9.2 billion in November last year in terms of bond turnover.

Ocampo six

Six prominent Kenyans could be charged at the International Criminal Court at The Hague for their involvement in the 2007 post-election violence. The six named by Mr Luis Moreno-Ocampo are Eldoret North MP William Ruto, Finance Minister Uhuru Kenyatta, Industrialisation Minister Henry Kosgey, Public Service boss Francis Muthaura, Kass FM journalist Joshua arap Sang and Postmaster-General Hussein Ali.

The naming of high profile personalities has sparked anxiety among Kenyans and sent market jitters immediately the names were made public. The six who are awaiting the court verdict on whether they have a case to answer will greatly determine the political temperatures in the country in the coming months, a scenario that will have a great deal of influence on GDP performance in 2011.

GDP:6.1 per cent (3rd quarter)

According to statistics from the Kenya National Bureau of Statistics the economy grew 6.1 per cent in the third quarter of this year, up from 0.5 per cent in the same period the previous year. The sudden surge lifted mainly by growth in agriculture.

The Government expects aggregate growth for this year to stand at 5.1 per cent, up from 2.6 per cent registered in last year.

Despite the impressive forecasts for the economy, the shilling losing ground in this year.

Exchange Rate: Sh80

The shilling opened the year exchanging at Sh75.9 to the dollar. By close of business December 24, the exchange rate had rocketed to Sh80.6 to the green buck. The weak shilling favoured exporters to make up for falling international prices of agricultural products.

Inflation: 7 per cent

The year saw inflation stay at a near constant, opening at 4.7 per cent raising marginally to 4.5 per cent in December. The stability helped ease the frequent rise in essential consumer products, which has been a thorny problem in most of last year and this fiscal year, where food prices were adjusted almost on weekly basis owing to inflationary effects.

Petrol: Sh94

The price of petrol stayed above inflationary rates, forcing the Government to make good its threat to regulate retail prices. Towards the end of the third quarter of this year, the Ministry of Energy announced maximum prices for super, diesel and kerosene products in the country.

The Government announced that a litre of super petrol would retail at Sh94 (Nairobi), way below the Sh98 average pump price that was in place in fuel outlets by close of business in mid December.

Also capped were the prices of diesel that the State said should retail at Sh87.45, and Kerosene at Sh75.83 in Nairobi

A meeting held between the four chief executives of the four mobile operators, the Communications Commission of Kenya (CCK) and the local arm of Porting Access BV-the Dutch firm contracted by CCK to set up the Mobile Number Portability platform in the country set April 1, 2011, as the date mobile subscribers will be able to switch service providers without changing their numbers.

3000mw: the projected level of energy supply by 2013

Energy Minister Kiraitu Murungi revealed that plans to increase the country’s energy supply to 3000mw by 2013 had run into a storm following resistance by private investors to commit resources to several projects including geothermal plants.

The Minister told members of the National Economic and Social Council that the development was likely to spell doom for the country, which is struggling to break away from the perennial over dependency on hydropower.

October 2010

Dispute over the location of the Butali sugar factory erupts into a full-scale war following objection by the West Kenya Sugar Company Ltd (Weksol), which argued that the new factory is located within its catchment area.

The dispute between the two companies and the intervention of Government officials was flagged as danger sign for companies that may be considering investment in the sugar industry.

10: the number of years Safaricom has been in operation

Zain Kenya re-branded to take up the identity of its new owners, India’s telecom giant Bharti Airtel. Safaricom on the other hand celebrated 10 years of operation at the beginning of the last quarter of the year.

Both companies lined up several activities that added colour and spice to the price war that kicked off in August.

Sh30 billion: KRC debt

This is the amount owed to the State by the Kenya Railways Corporation (KRC).

Unnamed Government officials reveal that the State is considering writing off an estimated Sh30 billion owed by the Kenya by the Kenya Railways Corporation (KRC).

The move was meant to patch up KRC’s balance sheet and revert the corporation to the profitability path. The proposed action also sought to re-energise the corporation to handle massive infrastructure projects recommended under the country’s Vision 2030 economic blue print.

20 per cent: Sabmiller stake in Kenya breweries

These are the shares held by South African brewing giant, SABmiller, at Kenya Breweries. The South African brewing giant wrote to East African Breweries Ltd seeking to get out of Kenya Breweries Ltd where it controlled a 20 per cent stake as per an agreement entered in 2002. The agreement saw Castle Breweries Ltd, which exited the country, also close its plant in Thika. Under the agreement, EABL was to take over the brewing and distribution of SABMiller products in the Kenyan market while SABMiller did the same in Tanzania.

August 4: Nssf wrangles

The National Social Security Fund (NSSF) is rocked by boardroom wrangles over reforms and a freeze on employment that was placed by the Fund’s CEO Alex Kazongo. Financial Journal learnt that a group of long serving trustees had for months been planning a boardroom coup in bid to oust a section of trustees, including the CEO who was perceived as reformists.

During the same month, Kenyans overwhelmingly endorsed a new set of laws following a peaceful referendum. The outcome of the August 4 plebiscite, which many people thought would be the biggest threat to Kenya’s stability transformed into a blessing that has helped shore up the country’s credit ratings.

Sh2,000: Proposed maximum contribution to NHIF

The National Hospital Insurance Fund (NHIF) suspended the implementation of the new medical insurance deductions, which would have seen maximum contributions to the fund rise from Sh320 per month to a maximum of Sh2000 per month to allow for further consultations with representatives of workers’ body-Central Organisation of Trade Unions (Cotu).

Sh6 billion: sale of state enterprise

Is the amount of money Government intended to raise from sale of state-owned enterprises.

The sale plan scheduled for June 2010 flopped following failure by Treasury and parent ministries to act on the privatisation proposals prepared by the Privatisation Commission.

The recommendations were meant to guide the disposal of the National Bank of Kenya, five sugar millers, Kenya Wine Agencies Ltd (Kwal) and the 11 hotels under the Kenya Tourism Development Corporation (KTDC).

Sh41.9 billion: supplementary budget

This was the supplementary budget approved by Parliament.

The revised budget gave life to Government operations ahead of the national budget, which was tabled in June.

Finance Minister Uhuru Kenyatta faced little opposition as he sought the endorsement to spend an additional Sh27.62 billion, and Sh14.39 billion on recurrent and development programmes respectively in the next three months.