“It is strange and impractical for the 6th plaintiff (West Kenya) who is unable to settle a claim of Ksh 507,488,511 to allege that, at the time of submitting the bids to the company which is just one year after the admission of its precarious financial situation, it was capable of injecting Ksh36 billion into revival of the Company (Mumias),” county attorney Vivianne Mmbaka said in an affidavit filed by West Kenya millers.
It has been argued in court that, despite being the highest bidders to lease the ailing Mumias sugar company. West Kenya Sugar Company has no capacity to offer Ksh. 37Billion lease fee as it had stated. In 2021 during the Covid-19 pandemic, West Kenya millers had pledged at the Employment and Labour Relations Court, that, it had suffered huge losses and was on the verge of its collapse. These were related to a lawsuit filed by its former employees demanding for their arrears of around Ksh. 900 million.
Having been the backbone of western Kenya’s economy, Mumias Sugar Co. LTD collapsed around 2018 due to poor management which led to accrued debts owed to farmers, creditors, suppliers, employees, and KPLC.
Kenya Commercial Bank, being its largest local creditor, had secured rights to operate the ailing millers and protect the company assets under receivership conditions in September 2019. Pongangipalli Venkata Ramana Rao alias PVR Rao was appointed as receiver-manager by KCB.
In August 2021, Mr. Rao re-advertised the lease deal of around Ksh. 15,000,000 after the initial advertised bidding process was rejected by the Kenyan senate, due to lack of due process as stipulated by the 2010 Kenyan Constitution.
The Public Procurement and Disposal Act No. 3 of 2005 (PPDA), and the Public Procurement and Disposal Regulations, 2006 (PPDR), envisages transparency standards in all stages of public procurement, from invitations and access to public bids, tender opening, evaluation of bids and disclosure of evaluation criteria, information on the results of specific procurement transactions and availability of review mechanisms for decisions involving tenders and prompt and impartial resolution of disputes.
Several companies, both local and international, submitted their bids to take over Mumias sugar. Sarrai Group, a Ugandan-based conglomerate with diverse and inter-related agro-manufacturing companies across East and Southern Africa, was awarded a 20-year lease for assets of Mumias Sugar Company in December 2021.
However, Kenyan-based West Kenya Sugar Company has been battling in court with receiver-manager, Mr. Rao, protesting as to why the lease was awarded to the Ugandan firm despite West Kenya offering a higher bid of Ksh. 36 billion compared to Sarrai’s Ksh.17 billion. Nevertheless, this has been argued to be a sibling rivalry, since Sarrai , the CEO of Sarrai Group, is a sibling to Rai Sigh, who owns the Western Kenya-based millers.
On 14th February, Mr. Rao explained to the court why he bypassed West Kenya and awarded the tender to the Sarrai group, as follows:
- West Kenya had no sound plan; West Kenya failed to present detail investment plan proposed in the the lease making it difficult to assess wether the lease will be effective.
- West Kenya failed to confirm the availability of funds; It failed to provide a letter from the Bankers confirming the availability of the funds set out in their bid.
- Interest of conflict; West Kenya had a factory 36km East and another 35km Northwest of MSCL despite their early declaration in document that they didn’t have an conflict, they were harvesting 50% of sugarcane in MSCl. area.
- Court cases pitting West Kenya against MSCl were more than 100 cases over a span of 13 yrs that were all against either an employee or a competitor.
The final verdict is expected to be ruled on 16th of February.
How Will Twitter Make Money Under Elon Musk?
A Look at the Currently Proposed Options
So after week two of the Elon Musk Twitter drama, we’re left in a state of limbo, as we await the final approvals for the deal, which will eventually make Musk the head honcho at a private Twitter; which may or may not run ads anymore, may or may not allow all types of racist, homophobic and abusive speech, and may or may not be able to, one day, actually make money, despite these changes.
And we have little to go on right now as to how it will impact the company, and the platform as we know it. What we do know is that Twitter employees are increasingly nervous about their jobs, and the business that they may end up working for under Musk, while we’ve also had some slight hints as to how Musk plans to change the app.
To be clear, Twitter is not a charity, and after spending $44 billion on the app, Elon Musk will be looking for ways to maximize Twitter’s revenue intake, and recoup at least some of that cost. In a recent interview, Musk said that doesn’t care about the economics of the deal at all, and that his driving mission is to run “a public platform that is maximally trusted and broadly inclusive”.
But with huge debt, and accumulating interest, Musk has to make money too, and the bull case for the acquisition is that Musk, being the visionary that he is, sees something that others don’t, and can clear a pathway to optimal success for the platform – even though most market analysts see no viable pathway to turning any significant profit from the app.
So how will Musk do it?
Here are the areas that Musk is reportedly looking at right now – and to be clear, Musk has come up with these proposals without internal knowledge of the company and its current make up.
- Increasing subscriptions – Musk is reportedly looking to build Twitter Blue into a registration layer, of sorts, with users paying a monthly fee to get a verification tick that confirms that they’re an actual, real person. That could better enable Twitter to tackle bots (as it would make running bot farms cost prohibitive), while it would also ensure a level of transparency in the app, because you would know, based on these new forms of authentication tags, that you’re interacting with a real person, who’s registered their contact and payment details in the app. The economics could be difficult – if Musk were to charge $1 per month for this, that would bring in $229m per month/$2.7b per annum, if the current number of active users stick around, and aren’t all bots. You’d have to assume that quite a few won’t end up paying, which brings this down a lot, and would reduce Twitter’s revenue intake significantly, if this were the only way Twitter could make money in future. For reference, Twitter made $5.08b in revenue in 2021.
- Taking Twitter private – Of course, some of that revenue pressure is lessened if Twitter goes private, as it would no longer be beholden to shareholders who expect to see revenue rise by a defined, acceptable amount. Musk’s view is that Twitter needs to go private to ensure that it can make decisions free from the pressure of outside forces, enabling it to truly become a platform of free speech. The problem with that, of course, is that advertisers will be less comfortable placing ads alongside potentially offensive content – but that then leads into the next stage of Musk’s grand Twitter plan.
- No more ads – This would obviously be the biggest impact from a social media marketing perspective – Musk has said that Twitter should no longer run ads at all to remain truly independent. That then also means that Twitter would need to rely on alternate sources of income, and with ads making up 98% of the company’s revenue, that’s a big hole to fill. Part of Musk’s thinking here may also be that Twitter can cut costs by also removing all of the staff that work on its ad elements, which would be a major cost saving – but even so, if Musk wants to get close to making Twitter profitable, when factoring in its operating expenses versus income, it’ll be a big shortfall to make up. It’s difficult to see how this would be possible, but maybe, Musk knows something that we don’t.
- Charging for tweet embeds – This seems like a bit more of a stretch, but Musk has also reportedly floated the idea of charging websites for embeds of tweets from verified users, with the money potentially going back to the users themselves. That would align with Musk’s push to get more high profile users tweeting more often – maybe, if they can make a few bucks from tweeting, that could act as a motivator to get them sharing more in the app, which could spark more engagement with their fans, and generate more in-app activity overall. Of course, the counter is that people could just screenshot tweets instead, though there are ways that Musk could make tweets copyright protected, which would be even easier if he were to take this next step.
- Make Twitter ‘Pay to play’ for users – This is a more radical move – and to be clear, Musk himself has not proposed this idea, as such, just yet. But aligning with the concept of charging users for a verified user tick (different to the current blue tick for high profile users), Musk could look to make all users pay, or they simply wouldn’t be able to use the app. Your first instinct to this is that no one will pay, right? People can just use Facebook or Instagram or Snapchat instead – so why would anyone pay to simply log on and read tweets? I thought that too, but upon further reflection, I do think that Twitter is a critical platform for many journalists, political and other media types that use tweets to stay up with the latest news. That’s why Twitter is so influential, despite having only a tenth of the active users that Facebook does – while its audience may be smaller, the people that do use Twitter are generally among the most active in their respective industries, and following the latest tweets enables them to lead trends, re-distribute the latest news to their audiences off-platform, remain in-the-know, etc. As such, I suspect that many of them would pay, and if Musk were to lock tweets down, that would mean that they’re no longer publicly accessible, making it much easier to implement charges for tweet embeds, as well as any other re-use of on-platform content.
- Cost-cutting – The other key area that Musk is exploring is cost-cutting, which again aligns with the above points, in that Twitter could cut costs significantly if it no longer ran ads. Twitter spent $1.7b last year on sales and marketing and general admin costs, while it also spent an additional $1.2b on research and development, and $2b on infrastructure. Without ads, those costs could come down a lot, and if Musk can reduce those outgoings in a big way, he could, theoretically, make enough money from his subscription proposals to generate positive cash flow for the app over time, while also enabling it to remain independent, and therefore better able to run with a ‘free speech’ approach.
CBK to Interlink Safaricom and Airtel through Lipa na M-Pesa
The Central Bank of Kenya (CBK) plans to introduce a national payment system that will enable Safaricom’s Lipa na M-Pesa system to accept cash from rival firms like Airtel, allowing a smooth transfer of money in business setups.
Currently, with continuously expanding Airtel subscribers, Safaricom’s Lipa an M-Pesa system cannot accept payment for goods and services by Airtel subscribers, a hurdle the new system will remove.
The CBK plans to introduce the system by 2024.
The CBK said the increased use of mobile money through platforms like Lipa na M-Pesa at agents and merchants lacks interconnection among the telecommunications operators, something that looks awkward in this era.
“This trend is expected to continue increasing once initiatives such as interoperability are fully rolled out, allowing customers to seamlessly transact across the ecosystem irrespective of their provider,” the CBK said.
According to the banking regulator, the value of mobile money transactions through agents as a share of gross domestic product (GDP) has increased to 60 percent in 2021, from 23 percent in 2010.
In 2021, the mobile money transactions were worth over Sh6.9 trillion with over 2.2billion transactions in number.
The ability of different IT systems to communicate and exchange data is called interoperability.
Through interoperability, the CBK will replicate the linkage between M-Pesa and Airtel Money, which was introduced four years ago.
The system will see Airtel deepen in financial inclusion as it will be offered a larger share of the mobile money payments made through merchants.
Safaricom’s M-Pesa is a lucrative mobile money platform which the tech company has been uncomfortable with the campaign to interlink it to rival firms, on stiff competition fears.
“The emergence of a fully integrated ecosystem that is seamlessly interoperable is critical. A strong foundation has already been laid with the rollout of P2P [peer-to-peer] interoperability in 2018 and the industry engagement that culminated in the proposal for a single integrated solution with multiple functionalities (national switch),” the CBK said.
As of September 2021, Safaricom had 258,000 mobile money agents, leaving rivals with the remaining 31,255 outlets. For instance, more than 30 million Kenyans use M-Pesa, not just for sending cash and making payments, but also doing savings and borrowing.
Safaricom’s Lipa na M-Pesa holds 85.8 percent market share of non-cash payment for ordinary goods and services, displaying the depth of the mobile money platform in daily transactions.
“There is limited competition for merchant acceptance in mobile money space. This is also due to limited acceptance of competitor payment instruments,” the CBK said.
“Limited interoperability in the mobile money merchant acceptance space limits payment options available to customers as well.”
The system has overtaken the card payments system managed by banks and their global payments partners like Mastercard and Visa that have largely focused on serving formal customers.
After its launch in 2013, Lipa na M-Pesa has actively recruited both large and small merchants across the country, including supermarkets, fuel stations, corner shops, and hotels.
Other than eliminating risks and costs of handling notes and coins, the use of cashless payments has the advantage of reduced revenue leakages.
Due to increasingly growing digitization and reduced transaction fees by payment service providers, Cashless payments are expected to grow in the coming years.
However, many Kenyans still settle more than 90 percent of their transactions through hard cash. With continuous changes in the digital sector, the percentage will slightly reduce by 2024 when the new system will be in operation.
List of services suspended by the NTSA.
The National Safety and Transport Authority (NTSA) has announced the suspension of seven key services following a High Court ruling delivered last month.
In a public notice published in the local dailies, NTSA said it has halted licensing of driving schools, renewal of driving school licenses, licensing of school instructors as well as renewal of driving school instructor licenses.
Other services affected by the latest disruption include the application of Provisional Driving Licences by driver trainees and test booking for driving school instructors and driver trainees.
A declaration was made by the NTSA after the High Court pronouncement that the 2020 traffic rules were unprocedurally adopted.
On January 27, 2022, Justice Anthony Mrima delivered a ruling ordering the Ministry of Transport to ensure the rules are regularised by the National Assembly and the Senate before implementation.
The Judge directed Transport CS James Macharia to resubmit a copy of the rules and explanatory memorandum to parliament within 14 days.
The court further ruled that in the event that any of the Houses is unable to finalize on the rules, then the rules shall be dealt with under the next term of Parliament.
The case was filed in court by the Driving Schools Association. The association wanted the laws annulled on grounds that there was no public participation.
However, the court found out that there was sufficient public participation and declined to quash the rules.
Three Global Firms Signed By Nairobi Financial Hub On Its Launch
The supreme leader of North Korea Kim Jong Un
Famous people who have been charged with sex crimes
Tribes with most beautiful ladies in Kenya
Fally Ipupa : Age, Net Worth, Wife, Albums, Children & Genre Of Music
Freddie Figgers: The millionaire tech inventor who was ‘thrown away’ as a baby
Entertainment6 days ago
Celebrities who have opened up about their mental health battles
facts6 days ago
Idi Amin, the ruthless Ugandan Military Officer
Business5 days ago
Hackers Make Tactical Change, Now Targeting Small Businesses
facts5 days ago
President Daniel Toroitich Arap Moi the master of state craft.
facts6 days ago
What is sickle cell anemia and what does it entail
facts6 days ago
MAU MAU Rebellion: Bloody history of Kenya conflict.
Entertainment5 days ago
6 Tv characters killed in a show and were dead in real life
Business6 days ago
Why Buyers Are Now Running Away From Popular Used Toyota Cars