Weekly Investor Update (October-WeekTwo-2024)

5 min Read October 11, 2024 at 5:00 PM UTC

Monday

Uganda Delivers Second Rate Cut Amid Improved Inflation Outlook

Uganda’s central bank lowered its benchmark interest rate to 9.75% from 10%, marking its first consecutive rate cut in four years as inflation pressures ease.The move follows a similar reduction in August, signaling confidence in theimproved inflation outlook. Deputy Governor Michael Atingi-Ego stated that risks to inflation are balanced but emphasized a cautious monetary policy stance.The bank aims to maintain inflation control while supporting Uganda’s socio-economic transformation. Annual inflation slowed to 3% in September, while core inflation dropped to 3.7%, both below the central bank’s 5% target.

Uganda’s central bank is maintaining a cautious approach to monetary easing, with back-to-back rate cuts signaling confidence in inflation control. A stable Ugandan shilling, buoyed by strong coffee export earnings and moderate import growth, has also contributed to subdued inflation. The shilling has appreciated nearly 4% against the dollar since June, further aided by the US Federal Reserve’s recent rate easing.

Yellow Malawi, RDG Collective Get $3.25M for Off-Grid Solar Expansion

Off-grid solar companies Yellow Malawi and Zambia’s RDG Collective have secured a combined $3.25 million in debt funding from Acumen’s Hardest-to-Reach (H2R) initiative to expand clean energy access in underserved areas of Africa.Yellow Malawi, which distributes solar home systems and mobile phones to rural customers, received $2 million. It plans to provide energy access to 182,000 people, with the first $1 million tranche disbursed in US dollars and repaid in Malawian Kwacha, reducing foreign exchange risk.MeanwhileRDG Collective, a renewable energy provider, secured $1.25 million to support solar home systems for 66,000 people and provide solar generators to 180 small businesses in Zambia. The H2R initiative is a $250 millionAcumenfund supporting off-grid solar companies working to bring energy to unelectrified households.

The combined investment in Yellow Malawi and RDG Collective reflects a growing commitment to expanding energy access in underserved African regions. With innovative financing structures like multi-currency loans and impact-indexed loans, the investment will not only scale renewable energy solutions but also reduce foreign exchange risks and incentivize impact-driven milestones. This funding marks a significant step toward achieving universal energy access in Africa, empowering communities, and mitigating carbon emissions.

Libya’s Oil Output Surges Above 1M Barrels As Political Standoff Eases

Libya’s oil production has climbed above 1 million barrels per day for the first time in two months, following the resolution of a political standoff that had severely cut output and exports.Productionreached 1.067 million barrels on Sunday after the eastern government lifted a blockade on October 3, according to sources familiar with the matter.This increase in output comes as theglobal oil market grapples with weak demand, though prices rose on Monday due to concerns over escalating conflicts in the Middle East potentially disrupting supply. Brent crude has jumped 11% over the past week, trading near $80 a barrel.

Libya, which typically produces over 1.2 million barrels daily, saw its output plunge to under 450,000 barrels in August after the firing of the central bank governor by the UN-recognized Western government triggered an oil shutdown by the eastern faction. Political instability has frequently disrupted Libya’s oil sector as rival factions vie for control of its key economic resource. The restored oil production brings a much-needed boost to global supply, but its volatile political situation continues to pose risks.

Remittance Fintech Zepz Raises $267M to Fuel Expansion in Africa

Formerly known as WorldRemit, fintech company Zepz has raised $267 million in a new funding round to support its expansion in its core African markets and globally.The round was led byAccel, with participation fromLeapfrog,TCV,Coller Capital, and the International Finance Corporation (IFC), a member of the World Bank Group, which committed up to $20 million.This funding follows Zepz’s $292 million Series E round in August 2021, which supported its acquisition ofSendwaveand rebranding fromWorldRemit. The company operates both the WorldRemit and Sendwave brands, serving over 11 million users across 150 countries.

Zepz, headquartered in London, also has offices in several African countries, including South Africa, Uganda, Kenya, Rwanda, Tanzania, and Zimbabwe, looking to tap Africa’s $100 billion annual remittances market. While Zepz’s current valuation is undisclosed, the fintech was valued at $5 billion in 2021 and achieved EBITDA profitability in 2022. Despite earlier plans for an initial public offering (IPO), the company has paused those ambitions, with investors in no rush to take Zepz public, according to Accel partner Harry Nelis.

Kenya Launches Digital Nomad Visa to Attract Remote Workers

Kenya has introduced a new visa category specifically designed for digital nomads, allowing remote workers to live and work in the country while boosting the tourism industry and stimulating economic growth.The Class N: Digital Nomad Visa, published under Legal Notice No. 155 of the Kenya Citizenship and Immigration Regulations, 2012, aims to attract skilled foreign workers without affecting the local job market.To qualify, applicants must have a valid passport, proof of remote employment, and an annual income of at least $55,000 from non-Kenyan sources. They also must provide evidence of accommodation and a clean criminal record from their country of habitual residence. Visa holders are prohibited from engaging in local employment, ensuring the protection of Kenyan jobs.

Kenya joins several African countries, including Mauritius, Cape Verde, Namibia, South Africa, and Seychelles, in offering digital nomad visas. It positions the East African country as an attractive destination for remote workers, promoting tourism and innovation while safeguarding local employment. With growing interest in flexible work arrangements, this move could contribute significantly to Kenya’s economy, drawing global talent and fostering international collaboration.

Equator Africa Gets $5M from IFC for African Climate Tech Startups

Equator Africa, a venture capital firm focused on supporting early-stage climate tech startups in sub-Saharan Africa, has secured an additional $5 million from the International Financial Corporation (IFC) to further boost innovation in theAfrican climate sector.This follows an initial close of $40 million in April 2023, aimed at addressing the persistent funding gap for seed and Series A-stage startups in the region.The Korea Green Resilient and Innovative Development (K-GRID) Program, backed by the Korean government, provided a $1.5 million guarantee, bringing Equator Africa’s total fund size to $54 million.

Equator Africa invests in tech-enabled companies across sub-Saharan Africa, with a focus on green energy, agriculture, and mobility, particularly in Kenya and Nigeria. It has already invested in six companies, including Kenya’s SunCulture, Roam, Odyssey, Apollo Agriculture, Ibisa, and Downforce Technologies, all of which contribute to climate solutions such as solar-powered energy systems, electric vehicles, and climate risk insurance.