🔅 Kenya's GMO conundrum
Today’s Issue: Visa's $1 billion investment in Africa, Rwanda's stand against the US, and the IMF's financial boost for Benin… ☕
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Photo of the day: Djibouti
Markets:
🔺 Nigerian SE: 49,233.02 (+0.50%)
🔻 Johannesburg SE: 72,989.34 (-1.76%)
🔻 Ghana SE: 2,453.64 (-0.02%)
🔻 Nairobi SE: 128.07 (-0.11%)
🔻 US S&P 500: 3,880.67 (-2.87%)
🔻 Shanghai Composite: 3,168.65 (-0.25%)
*Data accurate as of the close of markets across the continent
Nigeria: Inflation in Nigeria has steadily risen over the past year and is now hovering at around 21%. And food prices? Oh, they’re even higher—clocking in at a whopping 24%. To make matters worse, the World Bank and IMF have slashed their growth forecasts for the country, with the former predicting a dismal 2.9% in 2022.
Ghana: The cedi currency strengthened more than 12% after the news that it had secured a $3 billion loan from the IMF. It is at its strongest level in 2-1/2 months.
US: Chairman Powell made his New Year’s resolution early this year: Hike interest rates even further in 2023, and don’t back down even if Wall Street bets he’ll cave. He’s already made good on the first part, raising rates 50 basis points this week, but he still has his eye on beating inflation. At his press conference, he made it clear that he’s not done yet. And he had a message for Wall Street: Stop betting on the Fed to start easing policy in the near future. That’s a hard no, Powell said.
AGRICULTURE
Kenya's GMO conundrum
What's the story?
Kenya’s got a hunger problem. Over 4 million people are facing acute food shortages thanks to a record-breaking drought.
To tackle the crisis, the government recently allowed the cultivation and import of genetically modified (GMO) maize—but not everyone is happy about it.
First, what does GMO mean exactly?
GMO stands for Genetically Modified Organism. It’s an organism whose genetic material has been artificially altered using genetic engineering techniques. The most common GMO types are plants, but animals and microorganisms can also be modified.
So what are people saying?
The government argues that GMO crops will help boost crop yields and feed the population. But traditional maize growers say the crops threaten the sustainable tradition of recycling seeds.
Moreover, they’re concerned that the government's decision to allow them was rushed and failed to address long-standing health concerns.
The debate is a familiar one: Burkina Faso’s cotton farmers have also complained that their crop quality fell after they adopted GMO strains. And while some farmers in Kenya have seen benefits, with GMO cotton being pest-resistant and maturing faster, the maize farmers remain sceptical.
What’s the solution?
The National Biosafety Authority has sought to ease some concerns by stressing that they check every crop and genetic trait to confirm safety.
But smallholder farmers are worried that allowing GMO maize will leave them dependent on big foreign companies that own the patents to the seeds.
So what do they suggest? Instead of going down the GMO route, they’re calling for subsidies for seeds, fuel, and affordable credit.
ACROSS THE CONTINENT
Other Headlines
🌍 Visa just opened its wallet for Africa. The payments giant announced on Wednesday that it’s investing a cool $1 billion over the next five years in the continent’s rapidly growing digital payments industry. Visa CEO Alfred Kelly Jr. said that the move is part of the company’s effort to “grow a truly local business.” It’s a smart move: According to a McKinsey report, the continent’s e-payments market is expected to be worth around $40 billion by 2025—not to mention the new jobs Visa plans to create. To capitalize on the opportunity, Visa is introducing a new platform called Visa Acceptance Cloud that turns virtually any device into a payment terminal.
🇷🇼 President Paul Kagame of Rwanda had a few choice words for the US: Don’t try to bully us into releasing Paul Rusesabagina. Rusesabagina is a US permanent resident sentenced to 25 years in prison in Rwanda on terrorism charges. Rusesabagina is best known for his portrayal in the 2004 film “Hotel Rwanda” and his vocal criticism of Kagame’s rule. Rusesabagina is the leader of a Rwandan opposition group, and is accused of responsibility for violence committed by the group’s armed wing. The US government determined in May that Rusesabagina was wrongfully detained, citing a lack of fair trial guarantees. Kagame questioned why Rwanda should release Rusesabagina because he’s famous and a permanent resident of the US, and asked what his release would mean for the other 20 defendants who were tried with him.
🇧🇯 The IMF has given Benin a huge financial boost, immediately releasing $144 million to the country and a total of $287 million in July. The loan is part of a 42-month financing program and will help the government strengthen its economy despite global uncertainty and rising security risks. Benin's economy is expected to grow by 6% this year, but the IMF warned that high fuel and food prices, plus a strong US dollar, could widen the country's current account deficit to 6.1%. On the bright side, the IMF noted that inflation has stayed low, thanks to a strong harvest season and government subsidies.
FOOD FOR THOUGHT
Proverb of the Day
“When the shepherd comes home in peace, the milk is sweet.”
— Ethiopian Proverb.