<h1>NINJA Program Creating Champions for the Startup Ecosystem of Ethiopia&nbsp;</h1>Launching the NINJA Acceleration ProgramThe first industrial revolution used water and steam power to mechanize production. The second used electric power to create mass production. The third used electronics and information technology to automate production. Now, a fourth “digital” industrial revolution is underway, building on the technological advancements of the last century and characterized by a fusion of technologies that is blurring the lines between the physical, digital, and biological spheres.&nbsp;Ethiopia is no exception - as stated in the country’s most recent Ten Year Development Plan (2020/21-2029/30) published by FDRE Planning and Development Commission, “technological capability and digital economy” is one of the ten key strategic pillars that are set to help attain the development goals of Ethiopia. In support of this work, the Government of Ethiopia (GoE) has committed to “build the human resources capacity to increase the potential workforce in the innovation, technology and research subsectors”.&nbsp;<figure class="image"><img src="/uploads/2_S4_A3486_2f6e583bcb.jpg"></figure>In its current state, Ethiopia has to play catch up with the rest of the world when it comes to fully integrating the fruits of the third industrial revolution into its key economic sectors. Materializing this and fully entering into the fourth industrial revolution can likely be attained by promoting the nascent startup ecosystem that is just developing in the country’s economy, something that the GoE recognizes and supports.&nbsp;&nbsp;&nbsp;The Ethiopian Ministry of Innovation and Technology (MinT) is giving due attention to entrepreneurship and its immense potential to contribute to the growth of the economy. Working alongside the Japan International Cooperation Agency (JICA), MinT and JICA are seeking to encourage startup innovation that has the potential to solve persisting sectoral problems through the use of emerging technologies as part of the Next Innovation With Japan (NINJA) Acceleration Program.&nbsp;After the launch of the 2022 NINJA Acceleration Program in Ethiopia, the program accepted nearly 100 applications from startups all over Ethiopia in December to compete in a multi-stage and multi-month acceleration competition. The program’s three-phased selection process resulted in six trailblazing, technology startup finalists that have the potential to revitalize the country’s economy through driving sectors such as agriculture, tourism, logistics and digitalization and ICT.Following the selection of the six startups that fit the objectives of NINJA Acceleration Program, JICA and MinT, in collaboration with the implementing partner Renew Capital, will be hosting a Kickoff Conference on April 7, 2023 that will serve as the formal launch of a curated, four-month intensive training program for the six startups. The NINJA Acceleration program will lay the foundation for the selected startups to appropriately scale and build a world-class business through practical training, coaching and mentorship. It will also provide the six startups with a disbursement amount of ETB 500K and a trip to Japan for further training and networking.&nbsp;The Kickoff Conference will host a panel discussion by key stakeholders and the final business pitches of the winning six startups. This Kickoff Conference will also serve as a platform from which the finalists and their products are widely publicized to local and international stakeholders, such as enabling bodies, entrepreneurial support organizations, capital providers and potential customers.&nbsp;<a href="https://us06web.zoom.us/webinar/register/WN_Rfyt508jSRGMg1NmLbKmrA">[Please register here]&nbsp;</a>----------------------------------------1)Schuab, Klaus. World Economic Forum. 2016.&nbsp;<a href="https://www.weforum.org/agenda/2016/01/the-fourth-industrial-revolution-what-it-means-and-how-to-respond/">Link</a>

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NINJA Program Creating Champions for the Startup Ecosystem of Ethiopia 

Jump-Start Your Business GrowthIntensive two-day Executive’s Program for Ethiopian SMEsAre you excited to grow your business but unsure where to start? Stuck in a cycle and not certain how to tap into a new market or tackle a roadblock?&nbsp;<a href="https://www.renewcapital.com/companies">Renew Capital</a> is excited to announce that it will be hosting the Accelerated Gender-Smart Exec’s Program at&nbsp;The Hyatt in Addis Ababa on March 9 and 10!We are formally accepting applications for this intensive two-day course, so&nbsp;<a href="https://docs.google.com/forms/d/e/1FAIpQLSeZYPBnwIpzAIpwPds44fZYPVX9_boADsYpriHIX_ryPABDsA/viewform?usp=sf_link">apply today</a> to reserve your spot in this highly-recommended program.&nbsp;Over the course of an intensive two-day program, you will unlock the key elements to improving your company from the inside and accelerate your business growth. Topics include:<ul><li>Habits of successful executives</li><li>Strategic planning and execution&nbsp;</li><li>Forward-thinking sales and marketing strategy&nbsp;</li><li>Best practices in financial management&nbsp;</li><li>Securing gender balance, and more</li></ul>The program will conclude with a networking event to mingle with peers, mentors, investors and more.<figure class="image"><img src="/uploads/1_Y9_A3477_a63f38a1e6.jpg"></figure>Ethiopian small and medium enterprises (SMEs) can benefit tremendously from this intensive two-day training that prioritizes gender-smart business operations, customer engagement, execution speed and financial analysis. Three core themes will highlight opportunities to immediately tweak and improve your business.Understanding Your CustomersCritical to running a successful small business is understanding your customers’ needs and pinpointing their specific challenges. This requires marketing and sales strategies that engage customers and give you insights into their interests and expectations. With this information, you can develop solutions that provide your customers with what they need and ensure that your product or service is as successful as possible.Team Strength and Execution SpeedAn effective CEO needs to understand the strengths and weaknesses of their team and utilize them accordingly. Planning is an essential part of this process, but so is the ability to execute quickly and efficiently. Make sure that the goals of your team are clear and that they are capable of meeting them within the timeframe set.Financial ManagementEffective financial management is critical to the success of an SME. As the CEO, you must be able to manage the finances of your business and ensure that it remains financially secure. This includes budgeting, forecasting, and investing, among other tasks. Ensure that you are able to manage the financial side of your business with efficiency and accuracy to maximize success.Woven throughout the program are key lessons highlighting how gender-smart teams are not only socially responsible but also improve operational capacity, and positively impact your bottom line.&nbsp;By following the key habits and lessons taught in this program, we believe you can begin your journey to becoming a gender-smart, efficient business, poised for growth and success.&nbsp;Take advantage of a two-day training program to get the most out of your business and ensure its longevity. Apply now:&nbsp;<a href="https://docs.google.com/forms/d/e/1FAIpQLSeZYPBnwIpzAIpwPds44fZYPVX9_boADsYpriHIX_ryPABDsA/viewform?usp=sf_link">LINK</a>

Intensive two-day Executive’s Program for Ethiopian SMEs

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Jump-Start Your Business Growth

<h1>Renew Capital Invests in Ethiopian Audiobook and Podcast Company Teraki</h1>Bringing Ethiopians Together Through Localized Content<a href="https://latest-api.renewcapital.com/uploads/FINAL_Teraki_Press_Release_a2099fbd15.pdf" target="_blank" rel="noopener noreferrer">Download the Full Press Release&nbsp;</a>ADDIS ABABA, Ethiopia, January 3, 2023&nbsp;— In Ethiopia, two tech innovators have created a diverse online audio platform for amplifying Ethiopia’s tradition of storytelling. The company’s name is Teraki, the Amharic word for storyteller, and its two founding entrepreneurs, Nahom Tsegaye and Abel Engida are developing audiobooks and podcasts in various Ethiopian languages. They’re hoping to expand their company’s global reach with a recent financial and technical investment by Renew Capital.<figure class="image"><img src="/uploads/IMG_1460_7a201cd38c.png" alt="Two Founders of Teraki, an Ethiopian audiobook and podcast platform enhancing local storytelling, posing in front of Addis Ababa skyline, showcasing the vibrant cityscape of Ethiopia."></figure>The entrepreneurs began the project in 2019 with just $2,000, using those funds to recruit Ethiopian voiceover and acting talent to record narrations of some of their nation’s most popular books. As of November, the platform had an estimated 38,000 users listening to everything from novels, self-help books and children’s literature to podcasts on tech, entrepreneurship, interpersonal relationships, spirituality and current affairs.According to UN World Population Prospects 2022, 70% of Ethiopia’s population of 120 million is under the age of 30.&nbsp;“Our generation is highly and increasingly dependent on technology, and Ethiopian youth are increasingly using Teraki to understand different current affairs and define our place in this world,” said co-founder Nahom Tsegaye.&nbsp;“The youth really don't have that connection with their elders and those storytellers,” said co-founder Abel Engida.&nbsp;Teraki says over half of its more than 80 podcasts also create opportunities for Ethiopians to create a greater sense of community through online conversation.&nbsp;“We wanted to give a platform to everyone to discuss what it's like to experience feminism, sexism, relationships and other topics and what they mean in our own context,” said Engida.&nbsp;<figure class="image"><img src="/uploads/IMG_9045_d0123bfb52.jpg"></figure> According to 2021 data from the World Bank, &nbsp;Ethiopia is Africa's second largest country after Nigeria, and according to 2018 data from the Ethiopian government, there were three to five million Ethiopians living in the diaspora. This provides Teraki plenty of room for expansion. Teraki knows the diaspora is as Ethiopian as their compatriots living in the mother country, and they are confident their company can strengthen those connections, while reinforcing the linguistic and cultural identities of Ethiopian immigrants and expatriates, especially children enrolled in schools without their home languages.“It’s a really exciting project because we're planning not only to shine a light on these local talents, but also trying to reach out to this global community” said Engida.&nbsp;&nbsp;

Renew Capital invests in Teraki, an Ethiopian audiobook and podcast platform, enhancing local storytelling and connecting Ethiopians worldwide through diverse and localized content.

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Press Release: Renew Capital Invests in Ethiopian Audiobook and Podcast Company Teraki

<h1>JICA and MinT Invite Ethiopian Innovators to Apply for a Chance to Participate in an Acceleration Program and Pitch Competition</h1><a href="https://latest-api.renewcapital.com/uploads/FINAL_Press_Release_JICA_NINJA_b584106735.pdf" target="_blank" rel="noopener noreferrer">Download the Full Press Release&nbsp;</a>Ethiopia, December 7, 2022 — According to the UN World Population Prospects 2022, it is estimated that&nbsp;<a href="https://population.un.org/wpp/Download/Standard/Population/">close to 70% of Ethiopia’s population of 120 million people are under the age of 30</a>, making the country ripe for economic growth through innovation and startups. With that in mind, Japan International Cooperation Agency (JICA) Ethiopia office, in collaboration with Ethiopia’s Ministry of Innovation and Technology (MinT) is inviting aspiring entrepreneurs with innovative tech-enabled ideas to apply for the ‘Next Innovation with Japan (NINJA) Acceleration Program in Ethiopia 2022’ competition.&nbsp; JICA and MinT have several programs to support startups in Ethiopia as part of “<a href="https://www.jica.go.jp/activities/issues/private_sec/project_ninja/index.html">Project NINJA (Next Innovation with Japan)</a>,” and in addition to exploring that website, more information can be found in this&nbsp;<a href="https://www.youtube.com/watch?v=OIkXrsxIXtM&amp;t=148s">video</a>.&nbsp;<figure class="image"><img src="/uploads/Social_Media_Post_English_892035ce3b.png"></figure>Implemented in partnership with Renew Capital, the ten-month acceleration program and pitch competition are aimed at improving and enhancing the environment of startups by helping entrepreneurs obtain training, improve access to funding and connect them with critical resources to actualize their business plans.&nbsp;“One of the main objectives of Project NINJA is to encourage innovations solving the prominent problems of the society by utilizing emerging technologies. Innovative startups contribute significantly to economic growth and employment nationwide,” explained JICA “It also helps develop new and innovative solutions to challenges faced by traditional industries through cross-sector innovation, thereby creating a more dynamic and competitive society.”In the month of January 2023, the NINJA Accelerator Program team will screen applications for the initial round of screening out the 30 startups. These selected startups will spend one week receiving basic training in pitching their projects, then presenting those pitches to a panel of evaluators. From this round, a total of 15 startups will be advanced to the next level of competition, provided the evaluators will conduct in-person and virtual workplace visits and second-round interviews. From there, the evaluators will make their final decision on which six startups have earned the opportunity to participate in the intensive accelerator program, which will apply best practices from successful acceleration programs, support the startups in creating business networks and/or partnerships, build their capacity and business acumen as entrepreneurs, and address baselined needs.At the end of June 2023, the six accelerated startups will then present their final pitches to a wide audience of local and international investors, as well as officials from the governments of Japan and Ethiopia, local stakeholders and media outlets during a Final Pitch Event (demo day). The final six startups will get a disbursement amount of ETB 500K each upon delivery of two reports. The funding will be used to further refine their minimum viable product. Additionally, they will get the chance to visit Japan for training and meet with potential investors and mentors.If you are the founder of an innovative startup that: (a) is legally registered and operating a company in Ethiopia; (b) has a tech-enabled product (c) has a clear and focused business plan; (d) has a desire to scale operations; (e) is seeking expansion capital; and (f) is coachable and willing to learn, then please check out the&nbsp;<a href="https://docs.google.com/forms/d/e/1FAIpQLSeBjYbRvgf_tUumb6zbCVni1UvxhhZeNmzg6GBJRbWL0e6ICg/viewform">APPLICATION LINK</a> for more details on eligibility criteria and how you can apply for consideration. The Application will open on Monday, December 05 and will close on Monday, December 26 at 05 PM or (11 o'clock - local time).For more information on Renew Capital visit&nbsp;<a href="http://www.renewcapital.com">www.renewcapital.com</a>.&nbsp;About Renew CapitalRenew Capital is an Africa-focused impact investment firm that backs innovative companies with high-growth potential. With a presence in Ethiopia, Rwanda and Uganda, Renew Capital manages investments made on behalf of the Renew Capital Angels, a global network of angel investors, foundations and family offices who seek financial returns and sustainable social impact. Since the establishment of the network in 2012, the Angels have been actively investing in the region, mobilizing millions of dollars into Africa's middle market.### &nbsp;&nbsp;

Announcing the launch of the NINJA acceleration program and application in Ethiopia


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JICA and MinT Invite Ethiopian Innovators to Apply for a Chance to Participate in an Acceleration Program and Pitch Competition

<h1>RENEW’s Legal Corner: December 2022</h1>Primer on the Developments in the Investment Ecosystem in East Africa<figure class="image"><img src="/uploads/unnamed_1_ff4089a587.png"></figure>ETHIOPIAThe Ethiopian Government Comes up with a New Regulation to Govern Immigration FeesA new regulation titled the “Service Fee for Immigration and Citizenship Service Regulation No. 516/2022” (the “Service Fee Regulation”) which deals with the immigration fees chargeable in Ethiopia was introduced in November 2022. By the provisions of the Service Fee Regulation, there has been a significant increase in the application fees of visa and passport services. In some cases, there has been an increase of about 200% when compared to the previous fees. The extant provisions of the&nbsp;<a href="https://www.investethiopia.gov.et/images/Covid-19Response/Covid-19Resources/June-2/Investment-Proclamation-No.-1180_2020-Copy.pdf">Investment-Proclamation-No-1180/2020</a> which introduced a 3- and 5-year multi-entry visa category for investors has now been reaffirmed by the Service Fee Regulation. By the Service Fee Regulation, shareholders of companies registered in Ethiopia can apply for a 5-year multi-entry visa, while a general manager, a board member and top management employees of a foreign enterprise can only apply for a 3-year multi-entry visa. The current application fee for a 5-year multi-entry visa is USD 1K&nbsp; and the application fee for a 3-year multi-entry visa is USD 750. This is a welcome development and reduces the number of applications that expatriates and foreign investors need to make to come into Ethiopia. It also has the potential of improving the ease of doing business in Ethiopia. In addition, it is expected that this will streamline the application process and reduce the administrative burden on the immigration authority. The FDRE Immigration and Citizenship Service is expected to work closely with Ethiopian Investment Commission (EIC) to facilitate the issue of the new visa categories to foreign investors.&nbsp;&nbsp;The Government Expressed its Interest to Privatize Ethio-telecom&nbsp; The&nbsp;<a href="https://www.mofed.gov.et/media/filer_public/38/78/3878265a-1565-4be4-8ac9-dee9ea1f4f1a/a_homegrown_economic_reform_agenda-_a_pathway_to_prosperity_-_public_version_-_march_2020-.pdf">Homegrown Reform Economic Agenda: A Pathway to Prosperity</a> states explicitly the government’s interest to privatize the telecom sector. According to the reform agenda liberalization measures will include the issuance of additional telecom service licenses to operators and the partial privatization of the state-owned Ethio-telecom”. As part of this move, Safaricom Ethiopia has joined the Ethiopian telecom sector and is operational. For the second phase, the government expressed its interest to privatize part of Ethio-telecom and issued a request for bids to interested bidders in 2021. However, the Ethiopian government canceled and postponed the proposed privatization plan. This month, the government reinitiated the proposed privatization plan and expressed its interest to privatize 40% of Ethio-telecom. The expression of interest is valid until December 12, 2022 and major telecom companies are expected to participate. This move coupled with other privatization targets of the government&nbsp; is expected to have a positive impact on the overall economic and social development of Ethiopia. &nbsp;&nbsp;<hr>UGANDAGovernment suppliers adapt to the new VAT change and its effect on their businessGovernment suppliers have raised a number of questions with the new amendment to Section 26 of the Value Added Tax Law that permits them (suppliers) to account for VAT on cash basis as a solution to the recurrent challenge of delayed supplier payments from the government. Initially, government suppliers with taxable supplies not exceeding USD 133K (UGX 500M) in annual revenue could make use of the cash method in order to account for&nbsp; VAT regardless of who they supplied and whether payment had been received. This forced suppliers to borrow from banks as an alternative to funding VAT payments to Uganda Revenue Authority (URA) while maintaining considerable cash flow that was adversely affected by the slow government payments.According to an article in the Monitor Uganda, the questions that arose from the amendment&nbsp; included:<ul><li>Given that invoices are now issued via URA’s Electronic Fiscal Receipting and Invoicing Solution (EFRIS), how should invoices be declared in the VAT return when payment has not yet been received?&nbsp;</li><li>How should a supplier declare VAT incurred on its purchases and expenses when payment has not yet been made?&nbsp;</li><li>What criteria should a supplier use to determine if its customer qualifies as “government”?&nbsp;</li></ul>This amendment means that suppliers should keep record of payments received from government versus invoices issued to ensure an accurate declaration of VAT and avoid interest and penalties arising from late payment of VAT.&nbsp;The law states that any person who intends to access VAT on a cash basis should claim VAT charged on their purchases and expenses only when they have paid for them. Hence government suppliers would have to track invoices on purchases and expenses and how much they paid in that instance then claim only the input VAT on costs that have been paid.&nbsp;The Uganda Revenue Authority is yet to clarify on which institutions qualify as “government” for VAT purposes. The VAT law also doesn’t expressly stipulate whether the VAT incurred from government and non-government customers should be claimed on cash or accrual basis.&nbsp;<hr>RWANDAUSD 920K earmarked for online access for legal instrumentsAccess to the country’s domestic laws, law reports, judgements and even international treaties has been a consistent issue in the Rwandan legal system. Anyone that was interested in acquiring such information would have to acquire it either at the Office of the Prime Minister’s website or in person at the designated court of law. One would also have to keep an eye out for the legal amendments made either in the local newspaper or TV news segment. This significant USD 920K investment in developing a web portal of Rwanda law and cases dubbed (<a href="http://www.amategeko.gov.rw">www.amategeko.gov.rw</a>) will facilitate easy access to various legal documentation. Three languages; English, Kinyarwanda and French will be offered on the platform. It so far has over 700 laws available for students and legal practitioners. With the previously reported issue of case backlog in the judicial courts, this platform is a timely remedy to delivering swift justice and upholding rule of law. According to an article in the New Times Rwanda, Faustin Ntezilyayo, the Chief Justice, implored the software engineers working on this platform to update it regularly. He also pointed out evident gaps within the judicial system such as resources and literacy gaps that deter access to justice, adding that the web will address some of them.The portal was developed with the help of the judiciary, MINIJUST, technical support of the Rwanda Information Society Authority (RISA), and the Justice Sector IT team, engaged by LEXBASE S.A.&nbsp;&nbsp;&nbsp;&nbsp;1) A Homegrown Reform Economic Agenda: A Pathway to Prosperity, https://www.mofed.gov.et/media/filer_public/38/78/3878265a-1565-4be4-8ac9-dee9ea1f4f1a/a_homegrown_economic_reform_agenda-_a_pathway_to_prosperity_-_public_version_-_march_2020-.pdf,&nbsp;2) https://www.monitor.co.ug/uganda/business/prosper/vat-change-causes-headache-for-govt-suppliers-4030054 &nbsp;

Primer on the Developments in the Investment Ecosystem in East Africa

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RENEW’s Legal Corner: December 2022

<h1>RENEW’s Legal Corner: November 2022</h1>Our take on developments in the investment ecosystems of East Africa<figure class="image"><img src="/uploads/097_A2846_254237521f.jpg"></figure>ETHIOPIA&nbsp;Franco-Valuta Beneficiaries Are Expected To Show The Source Of Their Hard Currency Going Forward&nbsp;In April 2021, the Ministry of Finance (MoF) allowed importers to import basic commodities using the Franco-Valuta scheme without any requirement for verification of the source of their hard currency. This decision was made due to the inflation that is impacting the country’s economy. By allowing importers to import basic commodities without complying with the strict banking procedures, it was expected to increase the importation of basic goods into the country. However, in less than a year, the government reversed this decision. Starting from this month, importers are required to show the source of their hard currency to the National Bank of Ethiopia (NBE) to import goods through the Franco-Valuta scheme. The NBE has come up with this decision to control the parallel foreign currency market in the country. According to NBE, beneficiaries of the Franco-Valuta scheme are getting hard currency from the parallel market, and the requirement of verification is expected to alleviate this problem.&nbsp;&nbsp;Ministry of Finance Bans the Issuance of Letters of Credit For 38 Import ItemsThe Ministry of Finance (MoF) has banned the issuance of letters of credit for 38 selected import items. In a circular letter to the National Bank of Ethiopia (NBE), the MoF has ordered the denial of foreign currency issuance for these items, which was made effective on October 17, 2022, and will stay indefinitely. The restriction was imposed on the products as they were not found to be priority items. The prohibition spans a range of items, including processed foods, beverages, artificial jewelry and flowers, bottled water, fruits, carpets, hand and wall watches, human and artificial hair, perfumes, fireworks, bags, umbrellas, seafood, cigarettes, and others. Automobiles imported by private companies are likewise subject to the restriction. This ban will affect the nation both positively and negatively. It will have a detrimental impact on several business communities that are involved in the importation, wholesaling, supermarket business, and retail of the 38 items listed. It also has the potential to increase contraband trade. The prohibition will, however, assist the nation in obtaining foreign currency for imports of high importance, such as medicine and basic commodities, support the expansion of domestic enterprises, and reduce illegal money transfers related to the selected commodities.&nbsp;Trade and Investment Divisional Court Inaugurated in Addis&nbsp;The Federal Court of First Instance officially launched a divisional court solely focused on trade and investment. The court is composed of 11 hearings that deal only with construction, investment, banking, and insurance cases. Five of the hearings under the classification hearing are assigned to commercial matters, and the other five hearings are assigned to banking and insurance matters. The remaining hearing is assigned to deal with construction-related issues. The court is composed of 14 judges and five assistant judges. Although the court was inaugurated this month, the trial was started in June 2022. The bench is anticipated to improve service delivery in issues relating to business, banking, and insurance. Having a separate division court focused solely on trade and investment has a positive impact on enabling businesses in Ethiopia to operate more efficiently and productively by reducing the amount of time and money businesses are required to devote to dispute resolution.&nbsp;<hr>UGANDA<a href="https://www.newvision.co.ug/category/news/blb-fida-uganda-launch-partnership-to-champio-146166">BLB and FIDA Uganda partnership to prioritize women’s land rights</a>At the recent Legal Aid Open Day held in Luweero, the pertinent issues that arose for discussion during the legal clinics concerning women’s land rights included&nbsp;sensitizing women and youth, who are adversely affected the most during land disputes, about land ownership and offering legal support to these vulnerable groups in order for them to obtain unequivocal rights to their parcels. According to an article in the New Vision, a Memorandum of Understanding between the Buganda Land Board (BLB) and the Uganda Association of Women Lawyers (FIDA Uganda) will purposely be driven towards obtaining justice for women and youth over contested plots of land. Furthermore, emphasis will be placed on securing or registering their tenancies and understanding the different rights that come along with the specific type of tenancy held.&nbsp;This partnership seeks to address pertinent issues such as the certificates of occupancy that are conclusive evidence of ownership and rights to the land. It is also a beneficial partnership with the land board which is entrusted to manage some of the biggest parcels in the Buganda Kingdom. The two parties have a duty to educate the women and youth on their tenancy rights on land which will contribute to the reduction of perennial land disputes in the country.<hr>RWANDARwandan corporate lawyers to play a role in economic growthRwanda is on track to establish itself as a top investment and tourism destination in Africa by providing several incentives and legislative amendments to attract more foreign investments. With that comes a number of transactional agreements and laws that need to be accurately structured in order to ensure compliance with domestic laws and also provide a precedent for other investment agreements. It is essential that the whole entrepreneurial and investment ecosystem realize the role of lawyers in structuring major deals, drawing up laws, amending legislation and facilitating dispute resolution while completing the deal.&nbsp;In a New Times article, Felix Manzi, the Director of the CERTA Center for Law and Innovation, a new initiative with the purpose of blending Rwandan legal expertise with innovation and creation, stated that lawyers play a very pivotal role in Rwanda’s economic prowess. He noted that “the entire African continent is trying to attract FDI” and lawyers should equip themselves with the requisite knowledge to understand certain concepts regarding innovation and creation. He also noted that there may be an evident lack of skilled manpower to deal with legal advice and representation in this field which will consequently lead investors to reallocate their funds to a more equipped jurisdiction like Kenya2.Rwanda needs to train and maintain an efficient and competent legal fraternity that can compete within the East African regional bloc and also handle all the legal related tasks that come along with the rapid rate of growth and development which the country intends to achieve. &nbsp;&nbsp;<hr>1)<a href="https://www.newvision.co.ug/category/news/blb-fida-uganda-launch-partnership-to-champio-146166">https://www.newvision.co.ug/category/news/blb-fida-uganda-launch-partnership-to-champio-146166</a>2)https://www.newtimes.co.rw/article/2023/news/business/competent-business-lawyers-crucial-in-rwandas-economic-voyage-experts

Our take on developments in the investment ecosystems of East Africa: November

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RENEW’s Legal Corner: November 2022

<h1 style="text-align:justify;">Ethiopia to Open Up the Banking Sector for Foreign Investors: Here's What We Know</h1>For a long time, Ethiopia’s banking sector had a reputation of being traditional and out of reach to most citizens, including many entrepreneurs who needed credit to run or set up their businesses. The credit provision system was believed to favor the large corporations and affluent people with enough collateral and longtime relationships with the banks.&nbsp;One of the biggest problems was the lack of market competition. The banking sector had been off limits to foreign investors since 1974, and as a result, the market was only served by domestic service providers, which have been criticized for being static. But that dynamic is about to change.&nbsp; On September 3, the Council of Ministers adopted a policy presented by the National Bank of Ethiopia to open the banking sector to foreign investors.&nbsp;&nbsp;<figure class="image"><img src="/uploads/Money_bfe7a95e65.png"></figure>What Do We Know About the Policy?The move affirmed rumors that had been circulating for several years, and even though the full policy details have not been made public, some information about it was disseminated through a&nbsp; Council of Ministers press release.&nbsp;The government expects this policy to improve the quality of the service provision in the sector with knowledge and technology, establish links with the global market, increase the competitiveness, effectiveness and efficiency of the financial sector, ensure a sufficient supply of finance and foreign currency, increase the number of job opportunities created and improve economic efficiency.During a state television interview held the same day as the decision, NBE Banking Supervision Director Frezer Ayalew said foreign banks will be allowed to enter into the Ethiopian market in four modalities:&nbsp; a subsidiary model, branch model, joint venture with existing banks or through a commercial representative office. And according to a news story by&nbsp;<a href="https://www.thereporterethiopia.com/26647/">The Reporter Ethiopia</a>, an NBE official speaking on the basis of anonymity told the publication that this policy allows foreign investors to buy up to a 40% equity stake in existing Ethiopian banks, with a maximum of 5% allowed for individual foreign investors, 5% for non-bank investors and 30% for foreign banks.What’s in It for the Private Sector?Small and medium enterprises are expected to reap some of the biggest benefits of this decision since foreign banks will likely offer innovative credit facilities that promote greater competition among commercial banks and thus attract an influx of foreign currency.What Needs to be Done?The arrival of foreign banks is no guarantee of anticipated benefits. A dramatic forex inflow will largely hinge on the liberalization of the country’s capital accounts and floating the currency.&nbsp;What is Next?Following the policy’s full approval, the government will pass different legislation to carry it out. This includes amending the country’s banking and investment laws which currently prohibit foreign investors from participating in the financial sector. Multiple stakeholder consultations are anticipated to occur in the interim, which could alter some of our perceptions of the mechanics. Whatever the case, we will soon see foreign banks operating in Ethiopia.&nbsp;

Small and medium enterprises are expected to reap some of the biggest benefits.

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 Ethiopia to Open Up the Banking Sector for Foreign Investors: Here's What We Know

<h1>RENEW’s Legal Corner: October 2022</h1>Our take on developments in the investment ecosystems of East Africa<figure class="image"><img src="/uploads/LWN_6417_94da49e087.jpg"></figure>ETHIOPIAEthiopia Positions to Open The Banking Sector To Foreign Investors&nbsp;The Ethiopian Council of Ministers approved the draft policy on opening the banking sector to foreign investors. In Ethiopia, the finance sector, which includes banking, insurance, and microfinance, has been among the protected areas closed to foreign companies. The government of Ethiopia has decided to amend laws to allow foreign investments in the country’s banking sector. Once the new policy is published, the preparation of other legal frameworks like proclamations, regulations, and directives will follow. The NBE is already revising the existing banking business proclamation, and the long-lasting Banking Service Code is also expected to be amended accordingly.&nbsp; The newly approved policy allows foreign banks to enter using four commercial modalities. Foreign banks can open subsidiary arms in Ethiopia, open branches in Ethiopia, and will also be allowed to acquire shares in existing local banks. Based on this policy, foreign banks can acquire up to a 30% direct stake in local banks. Foreign individuals are allowed to acquire up to 5% and foreign non-bank investors are allowed to acquire up to 5% in any local bank. However, the policy excludes insurance and microfinance from the scope of activities open to foreign investors. The change Ethiopia is making in opening up the sector to foreign investors will enable it to support the sector’s services with technology, enhance the networking of the country’s economy with the international market, improve the forex shortage, and strengthen the competitiveness and efficiency of the finance sector.&nbsp;A New Limit On Birr And Forex Holdings Is Introduced&nbsp;The National Bank of Ethiopia (NBE) has issued a directive to limit the amount of birr and foreign currency held in the territory of Ethiopia. The Directive FXD/81/2022, entered into force on September 5, 2022, states that it has become necessary to limit the Birr holding amount for a person entering into and departing from Ethiopia, and sets conditions, limitations, and circumstances under which an Ethiopian, a resident of Ethiopia, and a non-resident or any other person may process and utilize foreign currency. According to the Directive, a person entering into and departing from Ethiopia may hold up to a maximum of Birr 3,000.00 (Birr Three Thousand) per trip to and from Ethiopia, and a person residing in Ethiopia entering the territory of Ethiopia shall convert all foreign currency he/she is carrying at an authorized forex bureau for the equivalent sum in Birr, or deposit to his/her foreign currency account within 30 days of entry to the territory. The directive also sets a time limit for holding and conversion of foreign currency for foreign nationals of Ethiopian origin or Ethiopian nationals not residing in Ethiopia who enter into the territory carrying foreign currency.The Government Has Introduced A New Directive For Imported Personal AppliancesThe Ministry of Finance has introduced a new Directive regarding taxation of personal appliances (i.e.,&nbsp;<a href="http://www.ecc.gov.et/web/guest/%E1%88%98%E1%88%98%E1%88%AA%E1%8B%AB%E1%8B%8E%E1%89%BD/-/document_library/iqHSSioaLJqF/view_file/911902?_com_liferay_document_library_web_portlet_DLPortlet_INSTANCE_iqHSSioaLJqF_redirect=http%3A%2F%2Fwww.ecc.gov.et%2Fweb%2Fguest%2F%25E1%2588%2598%25E1%2588%2598%25E1%2588%25AA%25E1%258B%25AB%25E1%258B%258E%25E1%2589%25BD%3Fp_p_id%3Dcom_liferay_document_library_web_portlet_DLPortlet_INSTANCE_iqHSSioaLJqF%26p_p_lifecycle%3D0%26p_p_state%3Dnormal%26p_p_mode%3Dview">Personal Appliances Import Directive No. 923/2022</a>, hereinafter the “Directive”) this month. This directive is more restrictive on importation of personal appliance goods compared to the previous law. The categories of goods which have duty and tax-free privilege are reduced from 102 categories to 16 categories under the new law. In addition, persons who accept a personal appliance as a gift shall pay a 30% income tax if they do not have a tax identification number. Furthermore, individuals are not allowed to receive a personal appliance product more than two times in a year. The Directive mentions the main purpose for the amendment is to fight illegal activities which are impacting the import trade negatively and the introduction of this Directive is expected to alleviate this problem.&nbsp;NBE Has Come Up With A New Insurance Directive&nbsp;&nbsp;The Ethiopian government is introducing big changes to the financial sector.&nbsp; Recently, the fintech and banking sectors have opened for the private sector and foreign investors. In September, the National Bank of Ethiopia (NBE) came up with another big move which greatly impacted one of the financial sectors in the country, the insurance sector. NBE introduced a new directive for insurance companies. Under&nbsp;<a href="https://nbebank.com/wp-content/uploads/pdf/directives/insurancebusiness/scan0054.pdf">Minimum Paid-Up Capital for an Insurance Company Directive No. SIB 57/2022</a> (hereinafter the “Directive”), the minimum paid up capital for new insurance companies has increased to ETB 400 million from the previous ETB 60 million amount. In addition, the Directive introduced provisions which impact the current operating insurance companies and new businesses which will join the sector. Increasing competition in the sector and enhancing the retention capacity of insurance companies are mentioned as the key rationales for introducing the new Directive.&nbsp;&nbsp;&nbsp;The Agricultural Sector Is Expected To Benefit From The Supplier Credit Scheme&nbsp; The agricultural sector contributes the lion’s share to the Ethiopian economy. However, investors engaged in this sector used to complain about its neglect from access to finance and credit for a longer period. To their satisfaction, NBE has introduced a new&nbsp;<a href="https://nbebank.com/wp-content/uploads/pdf/directives/insurancebusiness/scan0054.pdf">Minimum Paid-Up Capital for an Insurance Company Directive No. SIB/57/2022</a> which allows supplier credit for importers of agricultural machines/inputs. In addition, liquefied petroleum gas importers are also mentioned as the beneficiary of the supplier credit under the directive.&nbsp; However, the directive sets a maximum cap on the borrowing capacity of the importers. The debt-to-equity ratio of the company may not exceed 60:40 of the registered capital in the business license. If the importers fulfill the rest of the document requirements stipulated under the directive, they can benefit from the supplier credit scheme. The introduction of this directive is expected to increase agricultural productivity and to modernize the agricultural sector.&nbsp;&nbsp;<hr>UGANDAEU Resolution on EACOP Causes Stir Amid Progress on Oil PipelineAn emergency resolution passed last month by the EU parliament has come under heavy scrutiny by the citizens of Uganda at large. The resolution passed by a majority of the house in essence seeks to halt operations of Uganda's oil projects in particular the East African Crude Oil Pipeline (EACOP) and Tilenga.&nbsp;The legislative body of the European Union bases this decision on the insistence that there should be a feasibility study for the span of 12 months to ‘identify an alternative route that would preserve the environment and consider other projects based on renewable energy,’ as mentioned in an article by the Independent Uganda. The body has gone ahead to request that&nbsp; drilling activities should not commence around protected green areas such as the Murchison Falls National Park. They also requested that human rights violations such as arbitrary arrests of activists and inadequate compensation for those expropriated from their land by EACOP be remedied.This decision was met with a lot of dismay by the Uganda government who have said it is rooted in hearsay and misinformation about the realities of Uganda’s pipeline projects. The Minister of State for Energy and Mineral Development stated this month in regard to the route that ‘the Hoima- Tanga route was selected as the best route&nbsp; for Uganda after careful evaluation based on the best pipeline routing principles. In addition, Uganda has up-to-date stringent laws on the environment and protected areas, which are strictly followed in developing oil and gas projects.’While addressing the concerns on human rights violations and compensation for Projected Affected Persons (PAPs), the minister stated that ‘a specific Human Rights Impact Assessment (HRIA) was undertaken and measures were put in place to address any potential adverse effects on land-based livelihoods.’ He also added that EACOP in Uganda affected 3,648 PAPs as opposed to the alleged 100,000 that the EU parliament had projected and 2,662 have already signed compensation agreements with 1,977 fully paid already.3<hr>RWANDANew Land Law To Outline Different Avenues For Dispute ResolutionMatters of land conflicts related to boundaries and systematic land registrations under the new&nbsp; Law n° 27/2021 of 10/06/2021 governing land will now be handled by the National Land Authority and Districts or the City of Kigali. This was an evident switch from the earlier mass land registration from 2008 to 2013 where over 12M parcels were registered in the Land Administration Information System (LAIS). The new land law outlines the process of handling land disputes and enables the National Land Authority and local government institutions to make decisions on disputes related to boundaries and systematic land registration only.According to an article in The New Times, ‘Disputes outside of that scope do not fall under the powers of the National Land Authority. For example, land transfer disputes are not included in the new law because the transfer contract is signed between individuals and does not directly engage the institution. To implement this provision, Ministerial Order No 004/MoE/22 of 15/02/2022 determining modalities and procedures for resolution of disputes related to land boundaries and systematic land registration was published to set procedures to be followed when a person is filling the land case.’The new law emphasizes alternative dispute resolution as an effective remedy to these disputes but also gives the parties the option to pursue court proceedings as is their constitutional right. It has also enabled the courts to reduce the backlog of land disputes appearing before them which had proven to be a deterrent to effective and fair justice earlier in the year.Merits Of The ACFTA For Women And Youth In TradeThe African Continental Free Trade Area (AfCFTA)’s Protocol on women and the youth is a significant step in the right direction towards Intracontinental trade having included the two most dominant demographics in the trade industry. The protocol is being mulled over by the body’s Secretariat putting into account the immense contribution of youth and women to the continent’s economic growth. According to the Secretary-General of the AfCFTA Secretariat, Mr. Wamkele Mene, ‘they are the drivers of the African economy. SMEs run by women account for close to 60 percent of Africa's GDP, creating about 450 million jobs.’&nbsp;He also stated, in response to what the AfCFTA offers women who contribute to 70 percent of informal trade in Africa, that ‘we offer scale. Women will now be able to expand their market and have access to new markets in East Africa, in Southern Africa, in Central Africa. We offer an opportunity to expand into a market of 1.3 billion people with a combined GDP of $3.4 trillion.’Despite this protocol still being in the negotiation stage, the studies conducted to create inclusive legal provisions for youth and women within this protocol will offer a myriad of opportunities for young Africans developing cutting edge technological solutions for everyday problems and deviate from the traditional trade agreements that seemingly benefited mainly larger corporations. &nbsp;&nbsp;<hr>&nbsp;<a href="https://www.independent.co.ug/eu-resolution-on-eacop/">1) https://www.independent.co.ug/eu-resolution-on-eacop/</a>2) &nbsp;<a href="https://chimpreports.com/uganda-eu-resolution-on-eacop-hinged-on-hearsay/">https://chimpreports.com/uganda-eu-resolution-on-eacop-hinged-on-hearsay/</a>3) &nbsp;<a href="https://chimpreports.com/uganda-eu-resolution-on-eacop-hinged-on-hearsay/">https://chimpreports.com/uganda-eu-resolution-on-eacop-hinged-on-hearsay/</a>4) <a href="https://www.newtimes.co.rw/article/1494/news/business/land-disputes-now-resolved-differently-pursuant-to-new-land-law-in-rwanda">https://www.newtimes.co.rw/article/1494/news/business/land-disputes-now-resolved-differently-pursuant-to-new-land-law-in-rwanda</a>5) https://www.un.org/osaa/news/what-afcfta-holds-women-and-youths-20226) https://www.newtimes.co.rw/article/1329/news/business/why-the-afcfta-protocol-on-women-and-youth-in-trade-is-indispensable&nbsp;

Our take on developments in the investment ecosystems of East Africa: October

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RENEW’s Legal Corner: October 2022

<h1>Renew Capital’s East Africa Investment Survey Results</h1>At Renew Capital, we believe that Africa's economic potential hinges on its ability to develop and expand its small and medium enterprises (SMEs), especially as it rolls out its African Continental Free Trade Area.&nbsp;In an effort to confirm gaps and needs for entrepreneurs, Renew Capital launched an&nbsp; East Africa Investment Survey recently. The responses from more than 300 companies across the region confirmed that Renew Capital’s gender-smart ecosystem-building work remains crucial and is helping us further refine our capacity building efforts.&nbsp;The top three findings from the survey are:<ul><li>Women-owned Company Growth Lags Behind -&nbsp;The survey showed that female entrepreneurs continued to lag behind their male counterparts in building high revenue companies.&nbsp;Male-owned companies in the sample were able to hire more employees and began experiencing higher revenues at an earlier phase. While majority female-owned companies appeared to catch up as they grew, they fell behind in revenue again by the time they reached maturity.&nbsp;</li><li>Companies are Missing Regional Trade Opportunities&nbsp;-&nbsp;Approximately half of the companies in the sample have yet to take advantage of the broader regional market through cross-border trade. In addition, SMEs reported difficulty accessing capital and&nbsp;consistently reported access to markets as one of the most significant barriers to growth. Infrastructure issues and skilled management were also frequently reported as primary barriers to growth.&nbsp;</li></ul><figure class="image"><img src="/uploads/Regional_Trade_by_Country_fa0255669d.png"></figure><figure class="image"><img src="/uploads/Barriers_to_Growth_0c47a7fb64.png"></figure><ul><li>No Surprise, Entrepreneurs are Optimistic&nbsp;-&nbsp;Despite these barriers, entrepreneurs remained optimistic about the economic outlook. Most companies expressed a basic level of security about economic prospects within their countries as well as across the region. Even politically, few companies predicted that the economic situation in their country or region would deteriorate.</li></ul><figure class="image"><img src="/uploads/Regional_Economic_Outlook_444d1991db.png"></figure>&nbsp;Survey respondents were asked questions along six dimensions: Access to Capital; Growth and Trade; Gender Equality; Climate/Environmental Sustainability; Management Capacity; and Outlook on the Future. Respondents include 323 unique companies that have headquarters in Ethiopia, Kenya, Rwanda,&nbsp;Tanzania, Uganda and Zambia. The full results are available&nbsp;<a href="https://renew-new-api.madtechet.com/uploads/Investment_Survey_Report_Aug_2022_34abc5dac8.pdf" target="_blank" rel="noopener noreferrer">here.</a>“Surveys like this are integral to Renew Capital’s decade-long effort to refine our management capacity building offerings, support ecosystems and grow the missing middle of the African economies,” said Renew Capital Managing Partner Laura Davis.&nbsp;This blog post and the August 2022 East Africa Investment Survey report were authored by Raisa Chowdhury, senior consultant and monitoring and evaluation lead.&nbsp;

Survey Results  confirm need for capacity building, additional support for women entrepreneurs and an opportunity for regional trade.
