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Uganda has joined the big leagues.
Last week, MTN launched the country’s first 5G network. For now, the service is not everywhere Ugandans go; it is only available around the Lugogo Mall in Kampala, the city’s capital, but MTN plans to roll it out to the rest of the capital city by the end of 2024.
Telecoms
MTN Nigeria’s profits slump by 29.1% in H1
African telecoms are taking a beating, and Nigeria’s shaky forex market is all to blame.
Last week, Airtel Africa reported a $151 million loss in Q1 2023, a pale comparison to the $178 million profit after tax it made during the same period in 2022. The telecom cited the currency devaluation in Nigeria as the culprit.
Now, MTN Nigeria is reporting something similar. While this telecom reported ₦128 billion ($165 million) in profit for H1 2023, it is at least 29.14% shy of the ₦181 billion ($234 million) it recorded in H1 2022.
What went wrong? Per MTN Nigeria’s CEO Karl Toriola, it’s all due to the policy changes Nigeria has experienced in the first half of the year.
Since he came into power in May 2022, President Bola Ahmed Tinubu has removed the country’s long-standing fuel subsidy and floated the naira to create a unified foreign exchange rate. Toriola notes that these actions have created “additional financial burdens” for MTN users in the short term.
There’s still growth though: Despite its significant reduction in profits, the telecom still recorded growth in other areas. It reportedly gained 1.5 million new subscribers in H1, taking its total tally to over 77 million subscribers.
Its services revenue grew by 21.6%, driven by voice revenue growth of 12.1% and data revenue growth of 34.9%. Active mobile money (MoMo PSB) wallets also grew by 1.1 million in H1 to 3.1 million.
Zoom out: MTN is not everywhere we go out of the woods yet. The telecoms stressed that unrealised forex losses included in its net finance charges affected the telco, adding that there was no impact on EBITDA due to the quarterly nature of its tower contracts. However, it expects a full impact by the end of H2.
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Legislation
Kenya’s Finance Act is free
But the country’s taxpayers won’t be.
On Friday, the Kenyan Court of Appeal lifted an earlier court order barring the implementation of Kenya’s new Finance Act.
ICYMI: In June, three senators filed a petition to a Kenyan high court, challenging the constitutionality of the Finance Act 2023.
The Finance Act 2023, which is designed to generate revenue for the government, introduces several new taxes, including a 1.5% tax on content creators and a 3% tax on crypto traders. The senators argued that the Act was passed without due process and that the 1.5% housing levy which the Act mandates employers and employees to pay, is unconstitutional because the Constitution limits the national government’s role in housing to developing a housing policy.
Implementation of the Act was suspended in June, and on July 10, another court extended the freeze order, barring the implementation of the Act.
And now? Well, the order has been lifted and the Kenyan treasury can now enforce it.
The Court of Appeal lifted the order after Treasury Cabinet Secretary Prof Njuguna Ndung’u argued that the country was losing Ksh500 million ($3.5 million) for every day the Act was not being enforced.
Per the secretary, Kenya’s budget for the financial year of 2023/24—about Ksh2.9 trillion ($20.4 billion)—is heavily dependent on the taxes which the Act provides. Kenya was reportedly set to generate Ksh 211 billion ($1.4 billion) with the implementation of the Act.
The judges of the appeal court therefore lifted the freeze order, in order to allow the country to move forward with its projects.
The big picture: It’s not over yet though. The judges have stated that the courts may consider suspending specific provisions of the Act, as opposed to the entire Act, if the provisions had irreversible effects. For provisions without permanent effects, the courts urged members of the public to file for overpaid taxes and get refunded.
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Funding
Safaricom establishes two new subsidiaries for funding
Safaricom is looking to push some of its funds into Kenya’s budding ecosystem.
Last week, the telecom revealed its plans to enter into the venture capital space by setting up two new subsidiaries, plans that were subject to its shareholders’ approval.
On Friday, after the company’s annual general meeting, the company confirmed that its shareholders had approved the plans.
Growth and seed-stage startups get a boost: The telecom has now set up two new entities that will invest in startups: one in seed-stage startups, and another in growth-stage startups.
The seed-stage subsidiary will complement Safaricom’s already existing million-dollar fund, Spark Fund, which launched in 2014 to invest in early-stage startups in Kenya.
The second, the growth-stage subsidiary, will invest in well-established startups that will be key to accelerating Safaricom’s journey toward becoming a “purpose-led tech company by 2025,” as per the telco’s CEO. The entity will also serve as the primary investment platform for all strategic investments carried out by Safaricom.
In a statement, Safaricom CEO Peter Ndegwa said, “We are committed to empowering the tech ecosystem in Kenya and beyond, and this strategic move will enable us to broaden our investments, embracing both seed-stage and growth-stage start-ups. Incorporating these subsidiaries is pivotal to realising Safaricom’s purpose to become a purpose-led technology company.”
TC Insights
Funding African civic tech
Civic tech is a fast-growing sector around the world, witnessing a wave of innovative ideas, garnering interest from corporations, government agencies, and investment firms. However, the civic tech space in Africa is far from reaching its potential of helping to strengthen government capacity and improve civic engagement.
According to a database by Civic Tech Innovation Network (CTIN), civic tech projects have grown at a slow pace.
According to Seedstars, civic tech is the “next big thing in Africa” due to the growth in internet usage and social media across Africa over the years. Within the past few years, early-stage civic tech organizations have struggled to raise funds. Presently, they are mostly reliant on grant funding and donations from development agencies and philanthropies. Civic tech companies require institutional support to scale and maximise the impact of their innovative solutions. For instance, the launch of Civic Tech Fund Africa by the African Union boosted the growth of selected civic tech startups in Africa. Similar efforts need to be introduced to expand support for other emerging civic techs on the continent.
Startups in the civic tech space can partner with civil society organizations with donor funding to scale their innovative ideas and solutions, according to Abiola Durodola, co-founder of AdvoKC, a youth-led civic tech platform tracking governance performance, and accountability. “It’s important to find common grounds between civic tech startups and CSOs to work together to incubate and implement civic tech ideas to ensure smooth citizen participation in Africa,” he said.
There are emerging opportunities for the African civic tech sector to explore alternate funding and revenue streams to reduce their operational struggles. This underscores the need to productize civic tech initiatives and tailor them to local contexts on the continent. There is no better time to look beyond the incentives created by grant funding for civic tech in Africa to unlock and drive commercialisation.
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Crypto Tracker
The World Wide Web3
Source:
|
Coin Name |
Current Value |
Day |
Month |
|---|---|---|---|
 Bitcoin |
$29,283 |
+ 0.02% |
– 4.94% |
| Ether |
$1,857 |
+ 0.22% |
– 0.81% |
 Worldcoin |
$2.42 |
+ 6.22% |
+ 44.31% |
| tomiNet |
$3.14 |
– 4.26% |
– 27.03% |
* Data as of 11:30 AM WAT, July 30, 2023.
The world may be excited for Worldcoin but Kenya’s data protection bulldog is not. Over the weekend, the Office of the Data Protection Commissioner (ODPC) warned Kenyans to be vigilant in their engagement with Worldcoin, the cryptocurrency token initiative co-founded by Sam Altman, one of the founders of OpenAI.
The crypto project is implementing World ID, an AI-resistant protocol enabling online identity verification through iris scans. Users, who verify their humanity by scanning their eyeballs, get awarded free tokens referred to as WLD. They can then exchange and trade the WLD tokens for other crypto coins or keep them in wallets.
By scanning the iris, personal identification codes for each person are saved on a decentralised blockchain online.
“The ODPC is aware that Worldcoin has now been launched and is processing sensitive personal data in a manner that requires a demonstration of proper safeguards under the Data Protection Act, 2019. As the ODPC conducts its assessment, Kenyans are urged to ensure that they receive proper information before disclosing any personal or sensitive data,” read the statement.
Zoom out: Worldcoin has, however, been running trials in Kenya since April 2023, where hundreds of people are now reportedly signing up to get scanned.
NITDA CO-Create West Africa Tech Week
Nigeria’s National Information Technology Development Agency (NITDA) has just announced its partnership with the GAGE company for the Co-Create Africa International Exhibition. The Annual Co-Create Africa International Tech Expo will now be themed “NITDA-Co-Create West Africa Tech Week”.
Opportunities
- The AAAS Kavli Science Journalism Awards 2023 ($5,000 prize) is now open to applications from reporters doing work for independent news organisations around the world, with articles readily accessible to the public by subscription, newsstand sales or online access, with the submitted work available in English are eligible to Apply by August 1.
- If you are a young (no older than 24 years of age) and emerging photographer looking to embark on a career in the world of photojournalism, the Ian Parry Photojournalism Grant 2023 (up to £10,000) is open for Applications. Apply by August 31.
- Applications are open for the L’Oreal-UNESCO Young Talents for Women in Science Program – Maghreb 2023. Awarded doctoral and post-doctoral candidates will each receive an endowment of €10,000. Apply by July 30.
- Are you a startup founder looking to build your company? The ARM Labs Lagos Techstars Accelerator program is open for applications. Each company receives up to $120,000 in funding, and access to the worldwide network of investors, hands-on mentorship, and over $4M of perks. Join the 7,000+ founders who built their businesses with Techstars. Apply by August 9.
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