Tanzania’s low cost airline Fastjet (AIM: FJET) recently introduced the option to pay for flights using new PesaPal mobile money platform.

PesaPal provides various payment options through the internet, for which it works with banks, mobile network operators and credit card companies.

Fastjet Update

Fastjet forecasts a passenger load of 390,000 for the semester ending 30th June 2016 (2015: 363,726), which is lower than expected, according to the company’s latest trade update.

In order to improve operations, Fastjet has appointed a new CEO, Nico Bezuidenhout, who will join the Group on 1st August 2016.

Nico is an experienced executive in the civil aviation industry having been CEO of Mango Airlines, a subsidiary of South African Airways, for 10 years.

The Board of Fastjet and Nico have already identified a number of opportunities to stabilize the business and address many of the challenges it faces.

These include a fundamental review of the company’s fleet, the size and type of aircraft operated, the routes flown, the relocation of Fastjet’s head office to Africa, and the introduction of revenue generation initiatives.

“[…] Although market conditions are currently challenging, I am confident that we can build on the airline’s existing operational base to strengthen and develop the business and deliver on its considerable potential,” Nico commented.

Fastjet is a British-based low-cost carrier operating in Africa in Tanzania, Kenya, Uganda, Zambia, Zimbabwe and South Africa.

The company is Africa’s first low-cost pan-African airline, having started operations with the acquisition of now defunct Fly540, which operated in East Africa.

Fastjet’s branded flights commenced in November 2012 in Tanzania and the carrier has since then flown nearly 2m passengers with fares as low as USD10 one way.

The African Development Bank together with the government of Cote d’Ivoire this week held discussion on the country’s water sector.

The event took place during the World Water Day on March 22, 2016 in Abidjan. It was led by Louis-Andre Dacoury-Tabley, the Minister of Water and Forests, and Anne Ouloto, the Minister for Urban Safety and Sanitation. Also present was Jean-Michel Ossete, Coordinator of the African Water Facility (AWF), an initiative hosted and managed by the African Development Bank, among others.

They deliberated at length on the role of water in job creation, in line with this year’s World Water Day theme, Water and Jobs.

Discussions focused on Integrated Water Resources Management (IWRM) in urban areas. Minister Dacoury-Tabley outlined the many challenges faced. “We are facing major challenges and IWRM represents the most adapted way to address them. Ivory Coast is fully engaged in IWRM, gradually moving from sectoral management to integrated management. The time has come to put IWRM at the center of the land use planning,” he said.

The African Development Bank demonstrated its experience in IWRM in a film on rehabilitation of the Gourou watershed in Abidjan. About 800 direct jobs and 2,300 indirect jobs have been created as part of the works for rehabilitation of the watershed. Previously, inhabitants were victims of a heavy and anarchic urbanization, and poor management of solid waste. They were therefore facing heavy and repeated flooding, an insalubrious environment and the stilting of the Ebrie Lagoon.

Jean-Michel Ossete, Coordinator of the AWF, noted that the Bank’s projects included a strong job creation component. “At the African Development Bank, we facilitate the conditions for job creation, while keeping with our goal to ensure inclusive development and green growth in Africa,” he said.

He added: “The action of the Bank is not limited to infrastructure development; we also seek to include labour force in our development schemes. For instance, when we consider an agricultural water project, on top of the irrigated perimeters dedicated to private sector operators, we try to make sure that we provide land for family-run farming or for young people ready to invest in agriculture,” he added.

Millions of people working in the water sector are often not recognized or protected by basic labour rights. Today, almost half of the world’s workers – 1.5 billion people – work in water-related sectors and nearly all jobs depend on water and those that ensure its safe delivery. The 2016 World Water Day theme focuses on how the quantity and quality of water can change workers’ lives and livelihoods.

Angola should introduce a value-added tax (VAT) to complement the recently adopted non-oil tax reform, the International Monetary Fund (IMF) has said.

The long-awaited non-oil tax reform was approved by the National Assembly on July 4, 2014. The IMF welcomed the package as a “crucial step toward reducing the budget’s heavy reliance on oil revenue.”

After running a surplus over the last four years, the authorities expect an overall fiscal deficit of about four percent of GDP in 2014, reflecting a ten percent decline in oil revenue during the first quarter of 2014. “While this is unlikely to be a permanent phenomenon, significant steps have been taken in non-oil tax reform under the recently approved fiscal legislation aimed at diversifying the sources of non-oil revenues,” the IMF said.

The reform included the adoption of three laws: the general tax code, the tax procedure code, and the tax collection code. In addition, changes to personal and corporate income taxes were introduced to boost consumption and investment.

The corporate income tax rate was reduced from 35 to 30 percent, while the personal income tax threshold was increased to a monthly income of 34,450 kwanza (USD353), from 25,000. At the same time, the tax base was expanded by closing loopholes. A partial tax amnesty for some tax debts prior to December 2012 was also approved.

“Staff welcomes the recent approval of the core decrees comprising the non-oil tax reform. The approval of this legislation should be followed by improvements in the tax and customs administrations to fully realize the potential for higher non-oil revenue collections. A value added tax (VAT) could also be introduced in due course and, if implemented diligently, would provide more stable revenue for the budget, thus reducing the dependency on oil revenue and shielding the budget better from oil revenue volatility,” the IMF concluded.

Dar es Salaam — Many people believe that the growing influence of China on the Tanzanian economy and global politics is a new phenomenon. Last week, the Chinese Cultural Centre in Dar es Salaam provided a case study to prove otherwise.

In fact, at one time, around 618 AD, China was indeed a global economic power, specialising in silk trade.

Thousands of years ago, the people of East Africa, for example, used to trade with China, mainly in silk and porcelain, according to a recent report released by the Chinese embassy in the city.

The only difference is the manner in which trade between Tanzania and other African countries is conducted under the present economic conditions.

China, for many years, was not a member of the International Monetary Fund (IMF) and the World Bank. It only opened up its economy to the world in recent years.

Last November marked a turning point with the Bretton Woods Institutions (World Bank, and the International Monetary Fund), approving the Chinese currency, yuan, as one of the reserve currencies influencing the global financial market.

At the time of announcing the decision, Christine Lagarde, IMF managing director, was quoted as saying that the decision is “an important milestone in the integration of the Chinese economy into the global financial system”.

A senior officer at the Dar es Salaam-based Chinese Cultural Centre, Mr Gao Wei, said recently Beijing’s economic power could be traced back to the Tang dynasty, between 618 and 907 AD.

“During that period, Chinese porcelain was always at the centre of world cultural communication, and was the most loved, admired and widely imitated product in the world,” reads part of report which the Centre circulated to the media recently. Trade in Chinese silk and porcelain between the people of East Africa lasted for thousands of years before the slave trade era and coming of colonialists, according to experts.

This implies that the acceptance of the yuan by the IMF to join other five currencies as global reserve currencies is the re-emergence of the old glory of Chinese power in global trade, according to Mr Wei.

Speaking to the media on the sidelines of a recent forum organised by the Financial Management Institute for Eastern and Southern Africa (MEFMI), Bank of Tanzania (BoT) governor, Prof Benno Ndulu said Tanzania’s participation in the international bonds market should focus more on the Chinese currency, a.k.a renminbi, because of the current state of the global economy.

Tanzania now keeps five per cent of foreign exchange reserves to harness trade opportunities from the giant Chinese economy.

The BoT governor says: “Following the decision by the IMF to approve the yuan as one of the reserve currencies, we have done the right decision to keep five per cent of our foreign currencies’ reserve in yuan. Yuan has become the most important foreign currencies in international stock market trading. Our experience has shown that we have benefitted much from trading in Yuan in the international bonds market.”

With that decision, the yuan joined the US dollar, Euro, Japanese yen, Swiss Franc and British pound in the list of currencies the IMF uses as an international reserve asset, according to the BoT governor.

MEFMI executive director Caleb Fundanga says countries of Eastern and Southern Africa must focus more on trading with China to gain more from international trade. China, he notes, is now the world’s largest economy on a purchasing-power-parity basis. The Asian giant roiled a significant part of the African economy by cutting back on resource imports.