Kenyan Leader Ruto Switches Tack on Taxes After Deadly Protests
Kenyan President William Ruto plans to scrap some tax breaks to help shore up the state's coffers, a change in strategy that comes after proposals to introduce new levies sparked deadly protests and nearly toppled his government last year before they were abandoned.
The East African nation intends removing tax exemptions on mobile phones, pharmaceuticals, animal feed and other items, and curbing refunds and subsidies to limit tax expenditures currently estimated at about 400 billion shillings ($3.1 billion), Treasury Secretary John Mbadi said on a panel with Nairobi-based Citizen TV late Tuesday. The tax-rebate system was mired in corruption of 'unimaginable proportions,' with many fictitious claims being made, he said.
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Associated Press
40 minutes ago
- Associated Press
Bitcoin is introduced into Africa's largest slum, with risks and rewards
KIBERA, Kenya (AP) — Dotting the roadside in what is widely considered Africa's largest urban slum are typical stands selling vegetables. What isn't typical is their acceptance of bitcoin as a form of payment. Around 200 people use bitcoin in Soweto West, a neighborhood of the Kibera slum in Kenya 's capital. It's part of an initiative to extend financial services to one of the country's poorest and most under-banked areas. Its promoters say the adoption of crypto fits with the ideals of bitcoin as an accessible, democratic technology — but experts say it also has major risks. Bitcoin came to Soweto West via AfriBit Africa, a Kenyan fintech company, through its nonprofit initiative to improve financial inclusion. 'In many cases, people in Kibera do not have an opportunity to secure their lives with normal savings,' said AfriBit Africa co-founder Ronnie Mdawida, a former community worker. With bitcoin, 'they do not need documentation to have a bank account … that gives them the foundation for financial freedom.' Bitcoin, the first and largest crypto, was created in 2009 in the wake of the global financial crisis as a decentralized digital asset that could act as an alternative method of payment. The asset has found more popular use as a store of value, like a digital form of gold. Bitcoin has attracted enthusiastic supporters as prices have climbed almost 1,000% in the last five years. But its volatility and lack of regulation are concerns. AfriBit Africa introduced bitcoin into Soweto West in early 2022 through crypto-denominated grants to local garbage collectors, who are often funded by nonprofits. The groups are made up of dozens of young people, who Mdawida says are more likely to be open to new tech. After gathering on a Sunday to collect trash, garbage collectors are paid a few dollars' worth of bitcoin. AfriBit Africa estimates that it has put some $10,000 into the community, with garbage collectors acting as the main agents of spreading bitcoin in Soweto West. In Kibera, many people earn about a dollar a day. Now a small number of other residents hold bitcoin, and some merchants and motorcycle taxis accept payments in crypto. Damiano Magak, 23, a garbage collector and food seller, said he prefers bitcoin to M-PESA, the ubiquitous mobile money platform in Kenya, because M-PESA transaction costs are higher and the network can be slower. There are no fees for M-PESA transactions between individuals or businesses up to 100 Kenyan shillings (78 cents), but after that the fees increase with transaction size. Fees for the Lightning bitcoin network where transactions take place are free if people use a platform that AfriBit Africa introduced into the community. Onesmus Many, 30, another garbage collector, said he feels safer with his money in a bitcoin wallet instead of in cash because of crime. Some merchants have found benefits to accepting crypto, including Dotea Anyim. She said around 10% of customers at her vegetable stand pay in bitcoin. 'I like it because it is cheap and fast and doesn't have any transaction costs,' she says. 'When people pay using bitcoin, I save that money and use cash to restock vegetables.' The possibility that crypto prices could keep rising also appeals to residents of Soweto West. Magak and Many said they now have around 70% to 80% of their net worth in bitcoin, a far higher level of exposure than most people. 'It is my worth and I'm risking it in bitcoin,' Magak said. That concerns Ali Hussein Kassim, a fintech entrepreneur and chair of the FinTech Alliance in Kenya. 'In an extremely volatile asset like bitcoin, it's overexposure. I can't afford to lose 80% of my wealth. How about a guy in Kibera?' Kassim said. 'You are exposing a vulnerable community to an ecosystem and to financial services that they can't necessarily afford to play in.' Kassim acknowledged the potential benefits that digital assets could bring, particularly in facilitating cheaper cross-border payments like remittances, but failed to see the benefit in Kibera. Bitcoin's volatility could negate the benefits of cheaper transaction fees, Kassim said, and bitcoin does not have the same protections as other financial services due to a lack of regulation. Mdawida disagreed, calling bitcoin's unregulated nature a benefit. 'We don't shy away from the risks involved,' the AfriBit Africa co-founder said, noting the group's investments in bitcoin education in Kibera, including financial literacy training and crypto courses in the community. Efforts to introduce bitcoin into developing countries have faced challenges. Bitcoin was adopted as legal tender in El Salvador and Central African Republic but both countries have reversed their decision. In Kenya, the digital asset sector has faced legal and regulatory challenges, including crackdowns on cryptocurrency giveaways. This small project, focusing only on Soweto West, has been allowed. 'On my phone I put notifications on when bitcoin rises … and it's all smiles,' Magak said. 'Whenever it fluctuates up and down, I know at the end of the day it will just rise.' ___ For more on Africa and development: The Associated Press receives financial support for global health and development coverage in Africa from the Gates Foundation. The AP is solely responsible for all content. Find AP's standards for working with philanthropies, a list of supporters and funded coverage areas at
Bloomberg
an hour ago
- Bloomberg
African Ratings Agency Prepares to Take On ‘Big Three' This Year
The African Credit Rating Agency, a continental initiative to provide alternative assessments of repayment risks, plans to start operations by the end of September. The agency will publish its first sovereign rating report by the end of the year or early 2026, said Misheck Mutize, lead expert on credit-rating companies at the African Peer Review Mechanism, an African Union structure. It will appoint a chief executive officer in the third quarter, and candidates have already been shortlisted, he said last week.
Yahoo
an hour ago
- Yahoo
Peers vote to defy government over copyright threat from AI
Defiant peers have delivered an ultimatum to the government – calling on it to offer artists copyright protection against artificial intelligence companies or risk losing a key piece of legislation. The government suffered a fifth defeat in the House of Lords over controversial plans to allow the AI companies to train their models using copyrighted material. Peers voted by 221 to 116 on Wednesday to insist on an amendment to force AI companies to be transparent about what material they use to train their models. We will not back down and we will not quietly go away. This is just the beginning Elton John Speaking at an awards event after the vote, Elton John said copyright protection was an 'existential issue' for artists and urged the government 'to do the right thing'. He added: 'We will not let the government forget their promise to support our creative industries. We will not back down and we will not quietly go away. This is just the beginning.' Wednesday night's vote prolongs a lengthy standoff between the Commons and Lords over the data bill, which has been used as a vehicle by campaigners to oppose the government's proposed copyright reforms. Resistance to the changes in the Lords has been led by Beeban Kidron, a cross-bench peer and film director, whose amendments have been repeatedly backed by the upper chamber. The data bill now faces the prospect of being shelved unless the Commons accepts the Kidron amendment or proposes an alternative. Maggie Jones, the Lords minister for the digital economy and online safety, had urged peers to vote against the Kidron amendment after the government offered last-minute concessions in an attempt to stave off another defeat. Before the vote, Jones said peers were 'choosing whether they want the entire bill to fall' and that by voting for Kidron's amendment they would 'countenance the unprecedented – to try to collapse a bill that does nothing to weaken copyright law' but included other important measures including to combat sexually explicit deepfake images. Kidron told peers: 'This is our last chance to ask the government to provide a meaningful solution' and urged ministers to set out concrete steps to subject AI companies to copyright rules. 'It is not fair, not reasonable, not just, balanced or any other such word to stand in the way of the creative industries identifying those who are taking their work or their property. It is not neutral – it is aiding and abetting what we have called in the house widespread theft. 'We have asked privately and repeatedly on the floor of both houses what is the government going to do to stop the work of creatives from being stolen right now? The answer is nothing.' Several peers pushed back against the suggestion that the Lords' move was unprecedented and said the government was itself breaking precedent by not compromising. Tim Clement-Jones, the Liberal Democrat spokesperson for the digital economy, offered his party's 'staunch support' for Kidron's amendment. The Lords' move puts the data bill in double insistence territory. This means the Commons and Lords cannot reach agreement over legislation. In this scenario, under parliamentary convention, the bill would fall unless ministers accept the rebel amendment or offer an alternative. A bill falling is extremely rare but not without precedent – it happened to the European parliamentary elections bill in the 1997-98 session. Under parliamentary convention, the Commons has primacy as the elected house, and in rare instances where the Lords refuses to back down ministers can resort to the Parliament Act to pass the bill in the next parliamentary session. This would significantly delay the legislation. In concessions offered to peers on Tuesday night, the government said it would commit to publishing further technical reports on the future of AI and copyright regulation and do so within nine months instead of 12. 'A number of noble Lords have voiced concerns during ping-pong that the government is not listening. This is simply not the case,' Jones said in her letter, reiterating that ministers regretted the way the Lords rebels had gone about the changes. Jones stressed that the data bill was expected to generate £10bn of economic benefit by updating data protection law and that it would improve online safety, including by strengthening powers to ask social media companies to preserve data after the death of a child. Kidron said: 'It is in the gift of the government to accept the amendment, or put something meaningful in its place. They have failed to listen to the Lords, they have failed to listen to the creative sector, they have failed to listen to their own backbenchers.' Under the government's proposals, AI companies would be allowed to train their models using copyrighted work without permission unless the owner opts out. The plans have been fiercely criticised by creators and publishers including high-profile artists such as Paul McCartney and Tom Stoppard. Peter Kyle, the technology secretary, has said he regretted the decision to launch a consultation on changing copyright law with the opt-out system as the 'preferred option'. Campaigners against the changes believe that there is resistance inside Downing Street to making more substantial concessions.
