The firm said on  April 11 that it was assessing the future demand for Covid-19 vaccines. Moderna’s decision comes after questions over delays in acquiring land for the project in a special economic zone on the outskirts of Nairobi, the country’s capital. 

The company said it has not received vaccine orders from Africa since 2022 and has seen orders worth over $1 billion cancelled as risks associated with the virus wane. 

“Given this, and in alignment with our strategic planning, Moderna believes it is prudent to pause its efforts to build an mRNA manufacturing facility in Kenya. This approach will allow Moderna to better align its infrastructure investments with the evolving healthcare needs and vaccine demand in Africa,” the company said in a statement on Thursday.

Moderna has been working on several other vaccines based on mRNA technology, including cancer, shingles, and HIV. It recently announced a breakthrough in the development of a vaccine for cancer.

The company’s move is a blow to President William Ruto, who, since coming to power, has been courting foreign firms to drive his manufacturing agenda. In 2023, the Moderna deal accounted for the largest portion of Kenya’s $861 million in foreign direct investments (FDI).  

The facility, which was to be Moderna’s first manufacturing plant in Africa, was expected to position Kenya as a pharmaceutical and vaccines hub in the region with a capacity to produce 500 million doses annually.

The country’s inflation dropped to 3.3% in March from 3.4% in February, driven by a reduction in food inflation which dropped to -0.4% from 0.5%. Still, the policymakers maintained that elevated inflation risks persist due to global factors and exchange rate woes.

Michael Atingi-Ego, BoU deputy governor, said in a virtual briefing on Monday that the country’s core inflation is projected to rise between 5.5% to 6% in the next 12 months, and will return to the 5% target in the second half of 2025.

“The evolution of inflation remains challenging, influenced by factors such as the shilling exchange rate, supply-side shocks, global inflation, and domestic food supply. Forecasts have been adjusted downwards to the previous round, largely due to [the] relative stability of the shilling exchange rate,” Atingi-Ego said.

The BoU’s raise is expected to continue shoring up the Ugandan shilling, which has been in a free fall since February. Atingi-Ego said that the shilling’s drop was caused by foreign investors withdrawing funds from Uganda to look for higher yields in other markets.

The local currency, one of the best performing in Africa at the start of the year, has dropped by 4% despite the central bank’s interventions. 

“The recent CBR increase has had a spillover effect of stabilising the shilling exchange rate. However, the shilling remains vulnerable due to outflows of short-term foreign investor funds from the domestic market in search of attractive yield in other markets and strong domestic demand by corporates,” Atingi-Ego said.

The BoU’s growth forecast for the country’s economy for the current fiscal year that ends in June remained at 6% despite the challenging macroeconomic environment.

If approved, the policy will enforce zero-emission vehicle (ZEV) sales targets and investment criteria for car manufacturers and assemblers to qualify for government incentives. The policy will also establish clear requirements for local content (using locally sourced materials) in EVs that will be implemented gradually. The policy will further facilitate the production of EV components and support local battery manufacturing, recycling, and repurposing efforts.

At the launch of the draft policies, Kipchumba Murkomen, Kenya’s transportation cabinet secretary, noted that “the shift to electric vehicles significantly cuts emissions of greenhouse gases while reducing the petroleum import bill, currently standing at KES 628.4 billion ($4.8 billion). It will also promote local manufacturing and create jobs.”

To further promote EVs, Kenya has started issuing green-coloured number plates. The initiative aims to “raise awareness about EVs among the general public and encourage more people to consider switching to e-mobility,” Murkomen added.

The policy, launched in collaboration with the trade and investment ministry, will glean from the expertise of the private sector, international investors, and academic institutions to build the necessary EV infrastructure.

Kenya is a key player in African e-mobility, attracting prominent EV manufacturers. BasiGo, an electric bus company backed by the CFAO Group, is one of the pioneers of e-mobility in the country. The company’s electric buses serve Nairobi residents as commuter vehicles, popularly referred to as matatu. ROAM Motors, is also introducing electric buses for Nairobi’s bus rapid transit (BRT) system, but is currently offering electric motorbikes nationwide.

Ride-hailing companies have also joined the e-mobility movement in Kenya. In 2023, Uber partnered with Greenwheels Africa for electric motorbike rentals. Likewise, Bolt has invested over KES 100 million ($770,000) to integrate e-mobility solutions into its services.

This adjustment, effective from Q2 2024, is in response to changes in inflation, which remained steady at 3% in Q1, indicating the central bank’s aim to maintain stable prices and promote economic growth.

“The decision of the MPC is based on [the] macroeconomic forecast made in March 2024, which requires an increase in the scope of the monetary policy actions to contain the lingering inflation pressures arising from global economic developments,” said Emmanuel Tutuba, the central bank’s governor.

Tanzania’s economy grew by 5.1% in 2023, up from 4.7% in 2023. Growth in the first quarter of 2024 was also estimated at 5.1%. This growth was supported by increased public investment, especially in infrastructure, that sought to boost the private sector activity and investment.

Q1’s inflation remained under the country’s target of below 5% and regional economic blocs’ convergence criteria. This stability was maintained through monetary policy and sufficient domestic food supply.

As of January 2024, the BOT changed its monetary policy approach from focusing on the quantity of money to using interest rates. At that time, BOT said that an interest rate-based policy might give the bank more control over economic conditions. 

“The implementation of monetary policy in the first quarter of 2024 succeeded in containing the seven-day interbank interest rate within the target band of 3.5-7.5%. Credit was mostly directed to agriculture, mining, transport and manufacturing activities,” BOT said.

Under this framework, the BOT sets the CBR based on alignment with low inflation and support for economic growth. The CBR guides monetary policy, allowing for either tightening or expansionary measures. 

However, it does not fix interest rates offered by banks and financial institutions in Tanzania, which market dynamics will still influence.

On Wednesday, the apex bank noted that the headline inflation eased to 5.7%, the lowest in two years, as the costs of most food items including maize flour, wheat flour, kales, spinach, and cabbages dropped.

The CBK’s Monetary Policy Committee (MPC) exercised cautious optimism despite the shilling rallying against the dollar and inflation easing within the regulator’s 2.5% to 7.5% range.

“The MPC noted that its previous measures have lowered inflation, addressed the exchange rate pressures, and anchored inflationary expectations. Therefore, the MPC concluded that the current monetary stance will ensure that overall inflation continues to decline towards the 5.0 per cent midpoint of the target, and thus decided to retain the Central Bank Rate (CBR) at 13 per cent,” CBK said in a statement on Wednesday.

The Kenyan shilling has rallied 18%, addressing inflation caused by imports. The central bank on Wednesday quoted the shilling against the dollar at KES 131.48 from a record high of KES 160.18 in February–representing a 17.9% appreciation in the past month.

The CBK said that leading economic indicators point to “continued strong performance of the Kenyan economy in the first quarter of 2024,” buoyed by agriculture, the service sector, and ICT.

The March 2024 Agriculture Sector Survey conducted ahead of the MPC meeting indicates that food prices will fall in the next three months supported by favourable weather conditions, stronger shilling, and dropping fuel prices.

According to Roam, the partnership also increases the transition to electric motorcycles from traditional motorcycles. Motorcycle riders, popularly known as boda boda riders, are expected to increase their daily earnings by 30%. 

Roam told TechCabal that it is the largest provider of electric motorcycles putting out the largest volumes in Nairobi targeting boda boda riders and B2B providers. For riders participating in the deal, Mogo will offer financing at a rate of KES 25,000 deposit, and a daily repayment of KES 682 for 24 months. The package includes a motorcycle, battery, charger, and two helmets and vests.

“At Roam, our mission is clear, we want to provide the best and most affordable electric motorcycle to the market and Mogo is a great partner in accelerating that mission,” said Mikael Gånge, Co-Founder and Chief Commercial Officer of Roam.

Kenya boasts of about 3 million boda-boda riders according to James Macharia, the minister of transport. The United Nations also estimates that about 5 million Kenyans get their income from riding motorcycles. However, the Kenyan government is keen on converting most of the fuel-based motorcycles to electric.

President William Ruto had on September 1, 2023, launched a national e-mobility programme which has three-wheeled tuk-tuks, or auto rickshaws the focal point of a transition to green transportation. Kenya’s National Transport and Safety Authority (NTSA) plans to convert 2-3 million boda bodas to being electric by 2030.  

Raul Leitis, business development project manager at Mogo said the deal with Roam will go beyond Kenya to the rest of the continent and electric motorcycles will surpass fuel motorcycles in no distant time. 

“We see that the electric motorcycle market is ever expanding and with Roam’s innovative products that enable customers to not only charge at home but also at the Roam Hubs, we believe the electric motorcycle market will eventually become larger than the petrol one,” Leitis said. 

Data seen by TechCabal suggests this decline is primarily due to a steady core inflation rate of 3.4% in both periods. The main driver of this core inflation was the rise in service prices, which jumped to 5.5% for the year ending March 2024, up from 5.4% in February 2024.

The increase in service prices was linked to higher passenger transport costs, rising to 2.6% in March 2024 from 1.2% in February 2024. Financial services also saw a significant jump, reaching 13.4% in March 2024, compared to 0% in February 2024. This notable growth in financial service inflation warrants further investigation, and it is unclear if the government has taken specific measures in this sector.

Read more: Kenya’s March inflation drops to 5.7% as KES gains against the US dollar

Inflation for other goods was lower, reaching 1.6% for the year ending March 2024, down from 1.8% in February 2024. Relatively stable prices for most goods drove this slowdown, save for dried kapenta (silver cyprinid), popular local gin (waragi), and goat meat, which saw price increases in March 2024 compared to February 2024.

“Meat prices increased by 14.0 percent in March 2024 compared to 9.3 percent recorded in February 2024,” a report from the Uganda Bureau of Statistics states. 

Energy inflation 

Uganda’s annual energy and fuel inflation slowed to 7.6% in March 2024 compared to 8.0% in February 2024. This moderation was thanks to decreased price increases for charcoal, firewood, and petrol.

At the same time, the slowdown in energy and fuel prices suggests potential government interventions to stabilise fuel prices or promote alternative energy sources.

Between March 2023 and March 2024, Kenya recorded increased costs in transportation (up 9.7%), housing and utilities (up 8.0%), and food and beverages (up 5.5%). However, the cost of these commodities fell in March after the Kenyan shilling posted gains against the dollar, currently trading at KES 132 to the dollar. 

Amidst these gains, the cost of moving goods, maintaining homes, and purchasing essential items remains high, indicating a high cost of living during this period.

“These three divisions [cost of moving goods, home maintenance and purchasing essential items] account for over 57% of the weights of the 13 broad categories,” said the Kenya National Bureau of Statistics (KNBS) in a statement. 

The consumer price indices and inflation rates come from surveys done each month. These surveys examine how much goods and services cost in shops and stores. The KNBS then picks a range of things that Kenyans typically buy. The surveys take place in the second and third weeks of the month and cover different areas across Kenya, with shops chosen to represent what people buy.

Kenya’s central bank (CBK) and others in East Africa are adjusting interest rates to support their struggling economies as they face inflation, currency depreciation, and global supply issues. This implies that there seems to be a change away from using coordinated monetary policies worldwide to control increasing prices.

In February 2024, the CBK raised its policy rate to 13% from 12.5%, the largest jump in 12 years. This move is expected to lead to higher loan costs, impacting borrowers.

“The proposed action will ensure that inflationary expectations remain anchored while setting inflation on a firm downward path towards the five per cent midpoint of the target range, as well as addressing residual pressures on the exchange rate,” said Kamau Thugge, CBK governor, in a statement to the East African.

Equity’s stock of bad loans jumped to $874.8 million last year from $481.9 million in 2022, revealing struggling local economies and hurting the bank’s growth while forcing the lender to increase provision for non-performing loans (NPL) to $269 million from $117.5 in the period.

The Central Bank requires Kenyan banks to set aside funds to cover loans where borrowers fail to pay principal or interest for 90 days.

“The NPL trend is consistent with management’s view as at the investors 3rd quarter briefing that NPLs had peaked. Prudent risk management culture led the board to approve a proactive derisking of future performance by providing for the lifetime expected loss on outstanding NPLs,” James Mwangi, Equity Group CEO, said on Wednesday during the release of the results in Nairobi.

Mwangi added that the manufacturing, real estate, and logistics sectors accounted for the bank’s largest share of NPLs, pointing to a tough business environment for most local firms. Bad loans comprised 32% of the lender’s loan book.

Since the COVID-19 pandemic, NPLs have been rising amid a tough business operating environment escalated by the devaluation of local currencies, rising interest rates, and record-high inflation.

Rising taxes in Kenya have also eaten into the disposable income for most households and businesses, leading to loan defaults.

Despite the profit drop, the Nairobi Securities Exchange-listed firm has retained a dividend payout of KES4 ($0.03) per share to shareholders, amounting to 36% of the profit after tax.

The bank said interest income rose to $795.4 million up from $656.5 million while non-funded income grew 30% to $579.4 million. Kenya’s top lender by earnings also saw customer deposits grow by 29% to $9.9 billion.

Equity, which also operates in neighbouring Tanzania, Uganda, South Sudan, Rwanda, and DRC, is still ahead of its main rival  KCB Group in profitability. KCB reported an 8.3% drop in net profits to $285.9 million due to a jump in operating expenses.

KQ, listed on the Nairobi Securities Exchange (NSE), reported a net loss of $171.9 million, down 47%—even though its revenues improved by 53% to $1.35 billion.

The loss-making airline flew 5 million passengers in 2023, about 36% of Ethiopian Airlines’ (ET) passenger traffic in the 2022/23 financial year. ET is the carrier’s main competitor in the region.

“In the near term, the focus is on completing the capital restructuring plan whose main objectives are to reduce the Group’s financial leverage, fund growth, and increase liquidity to ensure the company can operate at optimal levels,” Allan Kilavuka, KQ Group CEO told investors on Tuesday during the release of 2023 financial results in Nairobi.

KQ, which has been in the red since 2012, promised investors that they are looking to return to profitability for the first time in more than a decade this year.

Accumulated losses over the years have seen Kenya’s flagship carrier dip into negative equity, making it technically insolvent with the government pumping billions in bailout.

Last year, the company tapped US advisory firm Seabury Consulting to help it restructure the business and develop a revival plan to wean it off state bailouts that have cost Kenyan taxpayers billions.

The carrier is currently in the process of hiring another consultant to help find an equity investor amid a new push to revive the business.

“Our focus is on completing the capital restructuring plan to reduce the Group’s financial leverage and increase liquidity to ensure the company can operate at optimal levels.

The aim is to place Kenya Airways on a stronger footing and provide a stable base for long-term growth,” Group CFO Hellen Mathuka said during the release of the results.