<h1 style="text-align:center;">From Enterprising Adventurer to Adventurous Enterprises</h1>I come from a family of adventurers. They gave me both a passion for new experiences and, from an early age, the privilege and opportunity to travel broadly. It was these adventures to distant lands that brought me close to people.At five years old, I played with joyful Shuar children on the banks of the Rio Upano in Ecuador and, at eight, sat in a field overnight through an earthquake with frightened families in Turkey. It was experiences like these that showed me that no matter where we are from or what our situation, we have more in common with each other than not. I also came to realize the power of connecting with another human being, of trying to understand each other, and the gift of shared laughter.<figure class="image"><img src="/uploads/Screen_Shot_2022_03_07_at_12_26_35_PM_1e774fe22f.png"></figure>Through these adventures, I have learned what it means to be a global citizen and the responsibility that entails. While we are more alike than different, we are not all born into equitable circumstances and provided with the same share of opportunities. These experiences also showed me that we can learn the most when we are willing to step into the unknown, when we are prepared to listen rather than speak, to learn with humility, and laugh at ourselves when we fall down.&nbsp;This passion and curiosity has fueled my journey. It has led me down many delightful paths I could never have imagined, and ultimately, brought me here, to RENEW. With all that the world and its people have given me so far, it is my hope to lead a life of empowering others to chase their own adventures and reach for their own dreams, and maybe even fall into a puddle or two and roll out with a smile on their face.A persistent theme throughout my endeavors to address inequities is the limitations imposed by lack of capital, whether that be monetary or human. We can dream as big as we want and work as hard as we can, but without the right resources and support, only a fortunate fraction of us will succeed, no matter our brilliance or drive. Recognizing this led me to the field of impact investing, to put capitalism to work for good.While in graduate school, I developed a regional expertise and focused my research on Ethiopia and the greater Horn of Africa. Looking beyond the great coffee, phenomenal food, and wonderful people, which is reason enough, I chose this concentration because I truly believe in the country’s potential to be a driving force for economic and political development in the region.Graduating in the onslaught of the pandemic, I was fortunate to be offered a position at a Europe-based impact investment firm focused on agricultural SMEs in the most underdeveloped countries. This gave me the hands-on impact investing experience I sought but left me yearning to put boots on the ground -&nbsp; and ideally, breathing in the mountain air of Addis Ababa every morning.&nbsp; On a crisp October morning in 2021, this became a reality as I stepped off Ethiopian Flight 575 and took the first deep breath of my next adventure. I haven’t missed a morning buna since.

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From Enterprising Adventurer to Adventurous Enterprises

<h1 style="text-align:center;">RENEW’s Legal Corner: March 2022</h1>Our take on the legal developments related to the investment landscape in Ethiopia, Rwanda and Uganda.<figure class="image image-style-align-center"><img src="/uploads/097_A2814_f27fb82728.jpg"></figure><hr>ETHIOPIAParliament Approves the Proclamation Lifting the State of Emergency &nbsp;Following the push several months ago from the Tigray People Liberation Front (“TPLF”) southwards to the capital, Addis Ababa, the federal government of Ethiopia declared a nationwide state of emergency, which later was enacted by the House of Peoples Representative (“Parliament”) as <a href="http://unidoseoul.org/en/?p=7249&amp;ckattempt=1">Proclamation No. 5/2021</a>. The main aim of the proclamation was to avert the threat posed by the TPLF, which is declared a ‘terrorist group’ by the federal government. Accordingly, a command post was established under the state of emergency proclamation, which was empowered to impose curfews, cause the termination of any means of communication and public transportation, and oversee activities of civil society organizations and activities of mass media and journalists, with the authority to revoke their license, among others. When enacted, the state of emergency had an expiry period of six months effective from the date of enactment, November 2, 2021.However, following the successful push back of the TPLF group to Tigray by the federal government, the Council of Ministers proposed for the state of emergency to be lifted as the threat from TPLF is no longer prevalent. As a result, the Parliament approved the recommendation and lifted the state of emergency on February 15, 2022, before the expiry date. According to the statement from the Prime Minister’s Office, the threat has reached a stage where law enforcement could be implemented by regular operation. The approval came after three weeks from the proposal by the Council of Ministers.The lifting of the state of emergency is seen as a positive development for the business community. Perhaps one of the most significant impacts of the lifting of the emergency is seen on the performance of the Ethiopian sovereign bonds. Following the expression of intention to lift the state of emergency by the government, the Ethiopian bonds witnessed a swing from near-worst to best performing. According to Bloomberg, “Ethiopia’s bonds are the best-performing sovereign debt in emerging markets this year.” The bonds have rallied 6 cents on the dollar following the announcement by the Prime Minister’s Office that the security threat had diminished. That brings returns this year to 13%, the best performance out of 80 developing nations tracked by Bloomberg. As a result of the war, the securities lost 28% last year alone, which was the worst performance after El Salvador.Executive Organs Proclamation Published&nbsp;One of the first tasks undertaken by the newly formed government when it took office on October 4, 2021 was restructuring the executive branch of the Federal Government. During its first session, the newly formed Parliament enacted a proclamation that defines the powers and responsibilities of the executive organs of the government. This has created a number of changes in the structure, from their nomenclature to restructuring their responsibilities and accountabilities. However, despite this being the first act of the Parliament, we had to wait for four months until the final proclamation defining their powers and accountabilities was published in the Federal Negarit Gazette. This month, the printouts of the Proclamation have been made available to the public, which is called the Definition of Powers and Duties of the Executive Organs Proclamation No. 1263/2021.&nbsp;One of the major reasons for the restructuring, per the preambles of the proclamation, is the need to establish an organizational structure that allows coordinated work that is efficient and cost-effective, helps reduce wastage and ensures accountability. Previous laws have not been able to establish an accountable organizational structure and designation of institutions and, as a result, it was impossible to ensure the continuity of institutions and uniformity of designation.&nbsp;Accordingly, the organizational structure has tried to classify government bodies into seven major categories, which are:Ministry - A ministry is led by a minister. It is mainly responsible for formulating sectoral policies, strategies and programs, and related matters and oversees and coordinates its implementation. Accordingly, 22 ministries are established per the proclamation. Major changes in this category are: the Ministry of Trade and Industry is divided into two different ministries, which are the Ministry of Trade and Regional Integration and the Ministry of Industry. In addition, the Ministry of Labour and Social Affairs changed its name to the Ministry of Labour and Skills, which under the new structure overtook the roles and responsibilities of the Jobs Creation Commission.&nbsp;&nbsp;Commission - A commission can be accountable to a Ministry, the Prime Minister’s Office or the Parliament. It coordinates the activities of different executive organs, formulates policies and strategies and oversees its implementation. The Ethiopian Investment Commission and the Customs Commission are the noteworthy organs in this category.&nbsp;Authority - An authority performs a regulatory function, issues standards and ensures their compliance with the same. It could be accountable to a Ministry, however, if there is a potential conflict with the activities of an institution to which it is accountable, it could be made accountable to the Prime Minister or other government organs. The Ethiopian Food and Drug Authority is a regulatory organ to note in this category.&nbsp;Administration or Development - An administration or development organ mainly conducts regular development and infrastructure development activities and oversees the same. One major introduction in this category is the introduction of Ethiopian Investment Holdings as a sovereign wealth fund that is independent of the Public Enterprise Holding and Administration and reporting to the Prime Minister. The Ethiopian Entrepreneurship Development is another organ established, which took over the roles and responsibilities of the Federal Small and Medium Manufacturing Industry Development Agency.&nbsp;&nbsp;Service - This is a new designation for government organs. It is used for institutions that are mainly established to provide centralized services necessary for government organs or provide services mainly to citizens. One of the major introductions under this category is the Documents Authentication and Registration Services, which used to be an agency in the past.&nbsp;Office - An office is an institution established for temporary or permanent purposes under special circumstances to conduct mainly activities that require special attention and institutional arrangement by uniformly coordinating different institutions.&nbsp;Institute - An institute is accountable to the relevant Ministry or another government organ that mainly focuses on training, study, research and consulting services. One of the major introductions in this category is the establishment of the Innovation and Technology Gifted and Talented Development Institute, whose powers are to be defined by regulation.&nbsp;&nbsp;Furthermore, one may notice that the number of executive organs that are accountable to the Prime Minister has increased. There are now seventeen executive organs that directly report to the Prime Minister.English Version of Commercial Code PublishedAs part of the economic reform program and to improve the country’s ranking in the World Bank's Ease of Doing Business ranking, the government started the process of updating the <a href="https://www.wipo.int/edocs/lexdocs/laws/en/et/et014en.pdf">six-decade old commercial code</a>. Accordingly, the Parliament adopted the new Commercial Code under Proclamation No. 1243/2021 (“<a href="https://chilot.me/2021/10/25/proclamation-no-1243-2021-commercial-code-english-version/">New Commercial Code</a>”), which came into effect in March 2021. However, the business community, especially foreign investors, has been waiting to get the printouts of the English version of the code. The wait has come to an end this month. The printouts of the English version of the New Commercial Code were made available to the business community.&nbsp;The New Commercial Code has made several changes to the old one, which principally is associated with its incompatibility with the current state of doing business. Many things have changed during the past six decades which made the repealed code outdated and inadequate to regulate current trade developments. Learn more about the changes <a href="https://www.renewcapital.com/resources/blogs/The%20Commercial%20Code%20of%20Ethiopia%20is%20Changing%20How%20the%20Country%20Does%20Business">here</a>.Parliament Approves the Enactment of the Private Employees Pension Proclamation&nbsp;The Parliament enacted a new <a href="https://chilot.me/2021/12/22/private-employees-pension-_draft_-proclamation/">Private Employees Pension Proclamation</a>. This will repeal the decade-old <a href="https://www.ilo.org/dyn/natlex/natlex4.detail?p_lang=en&amp;p_isn=89585&amp;p_country=ETH&amp;p_count=141">Private Employees Proclamation No. 715/2011</a> as amended by Proclamation<a href="https://chilot.files.wordpress.com/2017/04/proclamation-no-908-2015-private-organization-employees-pension-amendment.pdf"> No. 908/2015.</a> Adopting the new proclamation is required to strengthen and improve private organization employees' pension schemes and funds to ensure sustainability and reliability, benefit citizens better, and finally expand and consolidate to contribute to social justice, industrial peace, poverty reduction and development.&nbsp;As we understood from the final draft of the new proclamation, it has made some changes associated with the compliance requirements of employers and employees, manner of payment of retirement pension and gratuity. Now the new private employees pension proclamation is adopted, it will come into full effect once published in the Federal Negarit Gazette. We will be providing a detailed analysis of the changes introduced in the future.<hr>UGANDAUganda Declines to Renew Membership with the International Coffee Organization&nbsp;Uganda recently announced a two-year suspension of its membership from the International Coffee Organization (ICO), noting that the country needed to put pressure on the organization to address unreasonable terms in the International Coffee Agreement drawn up for member states, such as the unfair tariffs and restrictions imposed on imports of value-added coffee. According to an article in the East African, Uganda’s other concerns are the coffee price volatility, which it says is threatening the incomes of local farmers and sustainability of the coffee sector, unfair membership votes and contributions, and the increasing role of the private sector in the decision making of ICO, among other issues.The International Coffee Organization is the principal body in charge of fostering cooperation between international coffee exporters and importers. The surprising decision Uganda made to suspend its membership with the international body has left coffee farmers disgruntled especially considering Uganda is currently the second largest exporter of coffee in Africa with coffee comprising 22% of the country’s total exports and has a goal to be the world’s third-largest exporter of coffee by 2025 behind Brazil and Vietnam. The Uganda Coffee Development Authority has maintained that Uganda’s withdrawal from the International Coffee Agreement will not hamper coffee trade and export. Uganda can continue to export, but there are concerns that the withdrawal might limit market opportunities.&nbsp;<hr>RWANDAEALA Receives Key Bills Paving Way for Regional Monetary Union&nbsp;The completion of the discussion of three pertinent laws by the legislative arm of the East African Community (EAC) finally came to an end on March 1, 2022 with a plenary session to discuss the inception of the long awaited East African Monetary Institute (EAMI). The EAMI is charged with establishing the East African Monetary Union (EAMU) to create regional economic integration among the six member states of the EAC (Burundi, Kenya, Rwanda, South Sudan, Tanzania and Uganda). According to a Rwanda Times article, the bills under discussion are:&nbsp;<ul><li style="text-align:justify;">The EAC Standardization, Accreditation and Conformity Assessment Bill, which will provide for standardization, accreditation and conformity assessment of products traded in the EAC to facilitate industrialization development and trade to make provision for ensuring protection of health and safety of society and environment in the community;</li><li style="text-align:justify;">The EAC Financial Services Commission Bill, which will promote integration of financial systems in the EAC and harmonize regulation and supervisory practices in the non-banking financial sector; and</li><li style="text-align:justify;">The EAC Surveillance Compliance and Enforcement Bill, which will have the function of assessing the attainment of macroeconomic convergence by EAC partner states and to regularly monitor and enforce adherence to the macroeconomic convergence criteria by the participating partner states.</li></ul>These bills are critical to finally establishing the EAMI. The EAMI aims to pick up from where the East African Central Bank left off by issuing a single currency by 2024 as a means of achieving the ultimate goal of regional economic integration. These efforts were stifled last month when members of the Council of Ministers failed to attend or send representatives to the sitting, consequently leading to the postponement of the discussion on major business. The delay in decision making has been a recurrent obstacle in finally realizing all the EAC pillars of regional integration.&nbsp;Photo by Imran Mazar

Our take on the legal developments related to the investment landscape in Ethiopia, Rwanda and Uganda

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RENEW’s Legal Corner: March 2022

<h1 style="text-align:center;">Enabling Rockstars in East Africa!&nbsp;</h1>Though 59 universities produce fresh graduates every year in Ethiopia, a lack of business etiquette and job skills is seen among many of those who aim to enter the workforce. Even if these graduates have the right academic scores, they often lack mentorships and apprenticeships to prepare for the corporate world.&nbsp;One of the focuses of the Government of Ethiopia with regards to its higher education system is to improve the quality and employability of university graduates. RENEW has designed an internship program, launched first in Ethiopia, with the goal of enabling and preparing fresh university graduates for success in their career paths. Our internship program targets fresh graduates from all regions in Ethiopia giving equal opportunity through a diversity conscious and gender smart selection process. Our aim is that interns at RENEW grow as people and professionally through proper guidance in the right career path.&nbsp;“I am proud of how far I have come. I have met talented, easy going, fun, genuine professionals and a great mentor who wants to help me grow at work as well as my life. I am so grateful for my beautiful and new experience here at RENEW.” – Abigael&nbsp;<figure class="image image_resized" style="width:97.32%;"><img src="/uploads/intern_picture_8a9f4ea213.jpg"></figure> Led by a program coordinator, the internship program takes 6 months, shortlisting 10 excellent candidates from marketing, business and economics, legal, and project management studies every year from universities around Ethiopia. Selected interns are provided with onboarding training, business skill development training (communication, negotiation, presentation, work ethic, professional conduct, etc.). This is coupled with technical or project based “on the job training” according to their fields of study and interest, special mentorship sessions with experienced professionals, team outings and CSR activity participation and dynamic research project assignments for different divisions. Other benefits offered to them are appropriate stipends and medical insurances.“When I saw RENEW's flyer for an internship, my gut feeling told me to apply. It has now been more than 4 months since I joined the program, and I have gotten amazing mentorship from senior members of the team and familiarized myself with the professional space.” – Hermela&nbsp;Interns also get a chance to take The Exec’s Program at The Exchange. They are periodically assessed based on KPIs like implementing disciplines, the progress they made in various areas, qualities of their deliverables and the initiative they show to manage up for the team.&nbsp;“For a new graduate, having a chance to get an internship at RENEW has a special meaning. I got the chance to have a practical outlook on the concepts I learned theoretically in my economics studies at the university. It also enabled me to understand more about my strengths and weaknesses that I should keep and improve for my future career.” - SolomonAs RENEW expands to other countries in Africa, we look forward to seeing our internship program enable and empower the youth to be competitive and confident candidates as well as create further job opportunities by collaborating with reputable local universities.&nbsp;&nbsp;

RENEW has designed an internship program, launched first in Ethiopia, with the goal of enabling and preparing fresh university graduates for success in their career paths.

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Enabling Rockstars in East Africa! 

<h1 style="text-align:center;">Lets #BreakTheBias for International Women’s Day</h1><a href="https://www.internationalwomensday.com/theme">International Women’s Day</a> (IWD) is fast approaching on March 8, 2022, and this year's theme is “Break the Bias” (#breakthebias). The goal for this year’s campaign aims to turn a spotlight on the gender biases people carry around with them, and to actively move forward to collectively create a world free of bias, stereotypes and discrimination.&nbsp;At RENEW, we aim to encourage ourselves and those around us to examine and change our biases. Below is a video we’ve been sharing during <a href="https://www.renewcapital.com/what-we-do/market-building">The Exec’s Program</a> to help highlight the biases many tend to have. Watch the video, answer the riddle and consider sharing it in your community.&nbsp;<div class="raw-html-embed"><iframe src="https://www.facebook.com/plugins/video.php?height=314&amp;href=https%3A%2F%2Fwww.facebook.com%2Fmindspace.me%2Fvideos%2F550888202442564%2F&amp;show_text=false&amp;width=560&amp;t=0" width="1000" height="562" style="border:none;overflow:hidden" scrolling="no" frameborder="0" allowfullscreen="true" allow="autoplay; clipboard-write; encrypted-media; picture-in-picture; web-share"></iframe></div>&nbsp;

International Women’s Day (IWD) is fast approaching on March 8, 2022, and this year's theme is “Break the Bias” (#breakthebias)

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Lets #BreakTheBias for International Women’s Day

<h1 style="text-align:center;">A Globetrotter Who Found Her Way Back to Uganda</h1>I recently celebrated my one-year anniversary at RENEW. The journey has been a rollercoaster, in a positive way.&nbsp;A few months before joining RENEW, I completed my MBA at Warwick Business School. Going back to business school full-time was challenging initially, as I had spent years working in the SME investing field and developed a passion and increased desire for investing and transforming businesses to achieve their long-time vision, and I took a break to embark on an educational adventure. The reason I say it was an adventure is because for the last thirteen years, my life had been a series of adventures, where I called different places home and had a lot of introspection and exposure to different cultures.&nbsp;<figure class="image"><img src="/uploads/Diana_76e9ca7187.png"></figure>I was born and raised in Kenya, and I would classify myself as someone that is really patriotic and proud of my roots. After seventeen years growing up in Kenya, I moved to Canada for my final year of high school and that is when my journey of being a global citizen began. It was here that I was initially exposed to an environment that was incredibly diverse with students from Canada, Kazakhstan, China, Nigeria, to mention but a few. As a naturally curious person, I was fascinated by the divergence in values, perceptions of the world and desires of different individuals. However, one thing that was clear was despite our differences there was a general understanding as to what makes us human and the priorities of different nations, including economic empowerment. Soon after completing high school, I moved to Rutgers University in New Jersey, U.S.A. to pursue a bachelors of science in finance. While at Rutgers, which again was an incredibly diverse environment, I gained key tools that have formed the foundation of who I am. It was during this adventure that I believe I began to find my purpose. Upon graduating from Rutgers, I was itching to put into practice what I had learned. It was clear to me that my desire was to play a significant role in the development impact and economic empowerment of Kenya. The question was, how could I play a significant role, at the time when there was a wave of economic and social change. It is this passionate desire and indebtedness to my homeland that led me to move back home to Kenya, after living abroad for five years.After a challenging but active job search, the opportunity to join Pearl Capital Partners (PCP) presented itself and it seemed like the perfect fit because it focused on African emerging markets, Kenya included, and they were attracting a great degree of private equity and venture capital funding. Additionally, it tied into my long-term goal as the firm’s investment thesis was to invest in businesses that would generate social and environmental impact alongside a healthy financial return. Thus, getting a foot in the door at my age would open vast opportunities. While at PCP, I was immersed into substantial work from the beginning and was exposed to investment opportunities across eastern and southern Africa. I was fortunate enough to not only be involved on the investment side, but also got to represent the fund on different boards and be part of a team that was driving companies to become robust businesses that could scale.&nbsp;In February 2017, I moved to the Uganda office after being promoted to senior investment analyst and transitioned to the role of investment team lead. The general assumption is that Uganda and Kenya, given that they share a border, have cultures that are more or less similar. However, I was shocked to realize that while our cultures have similarities, there are certain cultural nuances that differentiate Kenyans. I soon realized that I had to tame my initial “aggression” or zeal to close investments in Uganda and had to initially take some time to appreciate and learn the country. As I flashback to July 2018, when I closed my first investment as a deal lead, I recall the feeling of euphoria and sense of self-actualisation that was awakened. The due diligence process and approval process was tough as the fund’s investment committee scrutinized the investment to detail. This accomplishment validated my long-term vision and inspired me to pursue my long-term goal of obtaining my MBA.In 2018, I began the long and grueling process to go back to business school. While it was tough, I was focused on the fact that my long-term career goal was to be a senior leader in the SME investing field and to have the ability to invest in businesses that could catalyze growth in Sub-Saharan Africa. To achieve this goal, it was essential that I develop strong soft skills such as managerial and leadership skills and to widen my network. My MBA experience at Warwick was a transformative and amazing experience. The challenging, yet scintillating, multicultural learning experience, provided the ideal environment to broaden my perspectives, whilst providing the perfect platform to share insights. Further, the expected differences of the students in the cohort were a hallmark of my experience and provided the opportunity (despite the COVID-19 pandemic) to unify the student cohort through thoughtful, honest and genuine intellectual forums.Fast forward to the end of the MBA program, I wasn’t sure where my career would take me - London, Nairobi, Paris or Kampala. As fate would have it, the opportunity to join RENEW presented itself, and it was clear that there was a reason that I needed to move back to Kampala. During the onboarding process in Addis, I felt at home knowing that I was part of a team that shared the same values. That is the desire to address the missing middle and support SMEs in Africa in order to scale and be regional champions. The multi-faceted approach that RENEW takes from the Exchange, to the Asset Management Division and finally the Shared Growth Services team fascinated me and I knew that I was part of a team that had a compelling vision and took a pragmatic approach in investing.&nbsp;People ask me what I’m most proud of on this journey. The answer is simple: my constant evolution and growth as an individual while staying true to my long-term vision and values. While the journey has led me back to Kampala, I can say with confidence that I’m excited about the adventure ahead, wherever it will lead me.&nbsp;&nbsp;

Uganda

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A Globetrotter Who Found Her Way Back to Uganda 

<h1 style="text-align:center;">ANDE Helps RENEW-Backed Company Become Gender-Smart</h1>&nbsp;On December 15, 2021, ANDE announced the winners of the Gender-Smart Investing Capacity Building Facility funds, an activity under the ANDE Gender Equality Initiative (AGEI). RENEW, along with four other organizations, were picked to advance their gender lens investing strategies. The funds, provided by the United States Agency for International Development (USAID), targets investors who are committed to advancing gender equality through investments into SGBs. Each of the five organizations are slated to receive up to $30,000 and support SGBs operating in India, Brazil or the East and Southeast Asia, Andean or Eastern African regions.&nbsp;Learn more about this announcement in ANDE’s recent press release: <a href="https://www.aspeninstitute.org/news/press-release/ande-gender-smart-investing/">ANDE Announces Winners of the Gender-Smart Investing Capacity Building Facility</a>.<figure class="image image_resized" style="width:100%;"><img src="/uploads/desta_713214ebe3.jpeg"></figure>

On December 15, 2021, ANDE announced the winners of the Gender-Smart Investing Capacity Building Facility

Gender Equality

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ANDE Helps RENEW-Backed Company Become Gender-Smart

<h1 style="text-align:center;">CBDC: the Next Big Disruption&nbsp;</h1>&nbsp;Digital currencies generally refer to acceptable means of payment completed through electronic forms. The last couple of years have seen a record number of entrants into the digital currency space, which has largely been dominated by cryptocurrencies, whose value seems to keep rising with every bout of human acceptance. In Africa, monthly <a href="https://www.investopedia.com/terms/c/cryptocurrency.asp">cryptocurrency</a> transfers to and from Africa under $10,000 increased 55% over the past year, reaching a peak of $316M in June (1). Also, according to the 2020 Global Crypto Adoption Index from blockchain analytics firm Chainalysis, South Africa, Kenya and Nigeria are among the world leaders in peer-to-peer cryptocurrency trading (2). Accordingly, Nigeria recorded weekly peer-to-peer volumes between $5M and $10M. Kenya and South Africa followed with an average of between $1M and $2M per week (3).<figure class="image image_resized" style="width:100%;"><img src="/uploads/CBDC_de233e6c9b.jpg"></figure>The statistics above solidifies one thing – <a href="https://www.investopedia.com/terms/b/blockchain.asp">blockchain</a> technology is here to stay! And the reality of this statement begs the question of how we can fully maximize the benefits that blockchain technology brings. Over the last couple of years, the biggest issues on acceptance have centered on two main factors. Firstly, the erratic nature of these cryptocurrencies being mined, and secondly, the unregulated nature of these cryptocurrencies, which is where the Central Bank Digital Currency comes in.The Central Bank Digital Currency (CBDC) is a form of blockchain technology that assumes the benefits of having a digital payment system but is particularly used as a virtual form of a country’s fiat currency. Simply put, it is an electronic record or digital token of a country's official currency. The major difference between this and the regular cryptocurrency is that the CBDC is typically heavily regulated by an individual country’s central bank, given it closely represents the country’s fiat currency. The reality is, central banks across the world now face stiff competition with their country’s currency due to the increasingly rapid nature of acceptance of cryptocurrencies. Currently, there are more than 87 countries exploring the possibilities of having their own CBDC (4).&nbsp;African countries are currently closely monitoring the global trends, with Nigeria now leading the pack to become the first African country to create its own CBDC, effectively becoming only the 7th country in the world to develop its own crypto asset, with the U.S. still in the research stage and China currently in its pilot phase.The importance of these digital currencies in Africa cannot be over emphasized, largely due to some of its benefits, the first of which is its ability to facilitate financial inclusion. For example, according to a report by Enhancing Financial Innovation and Access (EFInA), only 64% of Nigerian adults were financially included, while 36% of Nigerian adults (which translates to 38 million) were completely financially excluded as of 2020 (5). An individual country’s digital currency would typically allow rolling out of the USSD (Unstructured Supplementary Service Data) version of the e-currency as an alternative to downloading the digital wallet for people who do not have access to the internet. This would allow for people without any level of sophistication whatsoever to still be able to use the e-payment system.Secondly, and perhaps most importantly, the CBDC helps to create a relatively easier system of payment. In essence, the CBDC is expected to create a more secure, faster and cheaper means of carrying out financial transactions and currency exchange. This could be a major game changer for cross border trade as it could drastically reduce the cost of doing business with other countries as there are typically no middlemen with blockchain technology. An exciting possibility is the creation of one unique digital currency which can be used for cross-border trade in Africa, with acceptance by other African countries. For years the dream has remained elusive for East and West African regional blocs to create common currencies that will improve trade among member states. This could finally start looking like a not too far reality for the region as a lot of African countries have started showing some genuine interest in blockchain technology, and a willingness to explore its potential benefits. For example, in April, the Ethiopian government confirmed that it had signed a deal to create a national database of student and teacher IDs using a decentralized digital identity solution (6). The deal involves providing IDs for 5M students across 3,500 schools which will be used to store educational records. This deal is perhaps the largest deal to be signed by a government and has been making waves in the crypto-asset industry. Akin to this, Ethiopia has also adopted a Digital Transformation Strategy, where the government explicitly underscored the willingness to adopt a decentralized ledger technology that underpins cryptocurrencies. This is specific to the agricultural sector with the aim of benefiting farmers who are currently getting minimal amounts for the hardest work they put in the value chain. The adoption of the technology will allow traceability of transactions and is expected to force companies to ensure that their farmers adhere to Fairtrade Standards. In addition to the agricultural sector, the country’s Digital Transformation Strategy also incorporates the use of this technology in the tourism sector.In conclusion, Africa may become the next big digital currency market – leapfrogging the migration from cash to credit cards, and moving directly into digital currencies. While the emergence of digital currencies presents several challenges in regards to global adoption, due to its privacy and security concerns, it clearly has benefits that cannot be completely overlooked, especially for Africa. We at RENEW are closely monitoring developments, to ensure we can take advantage of opportunities that these developments may create for the IAN in the not-too-distant future. &nbsp;Reference;<ol><li><a href="https://www.dw.com/en/africas-quiet-cryptocurrency-revolution/a-55199637">https://www.dw.com/en/africas-quiet-cryptocurrency-revolution/a-55199637</a></li><li><a href="https://news.bitcoin.com/ukraine-russia-south-africa-nigeria-cryptocurrency-adoption/">https://news.bitcoin.com/ukraine-russia-south-africa-nigeria-cryptocurrency-adoption/</a></li><li><a href="https://blog.chainalysis.com/reports/2020-global-cryptocurrency-adoption-index-2020">https://blog.chainalysis.com/reports/2020-global-cryptocurrency-adoption-index-2020</a></li><li><a href="https://www.atlanticcouncil.org/cbdctracker/">https://www.atlanticcouncil.org/cbdctracker/</a></li><li><a href="https://efina.org.ng/our-work/research/access/">https://efina.org.ng/our-work/research/access/</a></li><li><a href="https://www.appsafrica.com/cardano-launches-blockchain-deployment-in-ethiopia-with-5m-students/">https://www.appsafrica.com/cardano-launches-blockchain-deployment-in-ethiopia-with-5m-students/</a></li></ol>

The Central Bank Digital Currency (CBDC) in Africa and why we are watching closely 

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CBDC: the Next Big Disruption 

<h1 style="text-align:center;">Ethiopia is Moving Towards Data Protection</h1>&nbsp;Ethiopia lacks a unified and comprehensive legal framework that governs privacy and data protection. However, there are protections scattered throughout different legislations, including the Constitution, the Criminal Code, the Civil Code, the Computer Crime Proclamation, and the Freedom of the Mass Media and Access to Information Proclamation. Even though the country doesn’t have a comprehensive data protection regulation nor a national data protection body, the regulatory bodies under these sector-specific legislations have the power to regulate data protection issues within their regulatory scope.However, the protections provided throughout these scattered legislations are not comprehensive. Specifically, considering the current digital world, a country typically has a comprehensive data protection system.&nbsp;In this context, the government of Ethiopia, through the Ministry of Innovation and Technology, recently took the initiative to draft a personal data protection proclamation. This draft personal data protection proclamation, which is the first by its nature in Ethiopia, is expected to be approved by the Council of Ministers this year (1). The proclamation, once enacted, will be vital in regulating the use and protection of personal data. In this blog, we summarize what this draft proclamation will cover.<figure class="image image_resized" style="width:100%;"><img src="/uploads/ethipia1_778f456404.jpg"></figure><h3>The Regulator&nbsp;</h3>The Ethiopian Data Protection Commission (the “Commision”) is envisioned under the draft proclamation as a national data protection institution. The Commission is proposed as a self-governing body accountable to the House of People's Representatives (HPR). The HPR also appoints the Commission's commissioner and deputy commissioners. The draft proclamation emphasizes the Commission's institutional independence, requiring commissioners to act with total independence and impartiality, neither seeking nor accepting orders.The Commission is charged with a wide variety of regulatory responsibilities. These include overseeing the implementation of the data protection law, keeping a register of data controllers and processors and undertaking audits of practices and policies of data controllers and processors, investigating complaints, and conducting search and seizure, among others. Furthermore, the draft proclamation also envisions the possibility that the Commission may be entrusted with additional roles in sector-specific data protection schemes.<h3>Rights of Data Subjects</h3>The draft proclamation contains fundamental data subject rights including the right to be informed, right of access, right to rectification, right to erasure, right to object to processing, right not to be subject to automated decision making, restriction right and right to data portability.<h3>Data Processing Requirements</h3>The draft proclamation envisages two levels of criteria for the authorized handling of personal data. First, it specifies the broad parameters for legitimate processing. Any processing will be lawful if it is based on the data subject's consent, which must be free, informed, explicit, unambiguous, and capable of withdrawal and granted before the start of the processing. It also provides other grounds for authorized processing, such as the fulfillment of contractual commitments, vital interests of the data subject, and public interest. Secondly, it defines the circumstances under which sensitive personal data, as well as data belonging to children, may be treated, setting of organizational and technical security measures, data protection impact assessments, prior authorization and data protection by design. Though the requirements may apply for various circumstances, failures to meet these requirements would make the processing unlawful. There will also be general requirements for personal data processing to be lawful including prior registration of data controllers and processors and appointments of data protection officers.&nbsp;<h3>Exemptions for Certain Categories of Data Processing</h3>An exemption for certain categories of data processing is provided in the draft proclamation. All of the exemptions concern the processing of personal data undertaken in the public interest. These are:&nbsp;<ul><li>When the processing is done for national security, defense, or public security purposes, including when the Prime Minister grants or certifies an exemption thereof;&nbsp;</li><li>When the processing is to prevent, investigate, and prosecute crimes, as well as the execution of penalties;&nbsp;</li><li>Processing to safeguard the general public interest, including the state's economic interests;&nbsp;</li><li>Processing to uphold judicial independence and judicial proceedings;&nbsp;</li><li>Processing for purposes of protecting data subjects or the rights and freedoms of others; and</li><li>Processing for purposes of historical, statistical or scientific research.</li></ul><h3>Data Breach Notification Requirements</h3>When a data breach occurs, the draft proclamation specifies two levels of notification: notification to the Commission where the breach is likely to constitute a "risk" to an “individual’s" rights and freedoms and notification to the data subject (the individual whose personal data is breached) when it’s likely to pose a high risk to the rights and freedoms of the individual. In principle, notification of the data breach should be provided to the Commission and data subjects within 72 hours unless the data controller has a reason for the delay.<h3>Transborder Data Transfer&nbsp;</h3>The provisions of the draft proclamation are the direct reflection of the General Data Protection Regulation (GDPR). The GDPR is the comprehensive data protection regulation of the European Union (EU) but applies to data controllers and processors in jurisdictions outside the EU provided they handle the personal data of EU citizens. When considering adopting personal data protection laws, many countries are considering laws in line with the GDPR for a variety of reasons. One of the reasons is to enable transborder personal data flow while avoiding statutory inconsistencies.&nbsp;The draft proclamation stipulates possible grounds by which the transborder transmission of personal data is allowed. Accordingly, the transmission of personal data from Ethiopia is permitted only if the third-party jurisdiction (any country other than Ethiopia, international organizations, and its subordinate bodies) provides an adequate level of data protection. The Commission will decide whether a third-party jurisdiction has an adequate degree of protection by taking into account two layers of considerations: general and specific.&nbsp;The general consideration encompasses all factors relating to a specific or group of data transfer procedures. The type of the data, the purpose and length of the intended transfer, and the state of the rule of law in the third-party jurisdiction are all vital particular concerns. It is worth noting that the Commission may restrict, suspend, or impose limits on transfers to third-party jurisdictions judged to have adequate levels of protection to preserve the data subject's rights and freedoms.&nbsp;There are, however, exceptions where personal data can be transferred to a third-party jurisdiction without meeting the adequate standard assessment by the Commission. These are: (i) when the data subject gives explicit consent to the proposed transfer after being informed of the lack of appropriate protection in the third-party jurisdiction; (ii) when the transfer is required to achieve certain legitimate aims of the data subject, data controller, or both, as well as for matters of public interest; and (iii) when the transfer is from a public register.The draft proclamation further provides the possibility of limited transfer of personal data to the third party jurisdiction, when the data subject gives his or her agreement to the transfer and elements of the data are omitted or reduced. However, authorization by the Commission may be required.&nbsp;<h3>What Happens if the Data Protection Laws are Breached?</h3>Under the draft proclamation, data subjects can file a complaint with the Commission if they believe their rights have been violated. In addition to the data subjects, if the Commission has any doubt about the contravention of the proclamation or any subsidiary laws, it can launch an investigation or cause an investigation to be initiated. Unless the Commission has reason to suspect or doubt the complaint (i.e. the existence of bad faith), it is required to investigate the case. Furthermore, the Commission is obligated to come up with a solution within a reasonable time frame, giving the data subject the option of going to court if the data subject is dissatisfied with the decisions of the Commission.&nbsp;The data subjects have the right to file an appeal to the Commission when they are unsatisfied with the decision rendered by a data controller. However, the time to appeal is limited and the Commission may dismiss the case for various reasons. Moreover, if the parties are not satisfied by the decision rendered by the Commission they can appeal to the Federal High Court.&nbsp;There are scenarios under which a third party (mediator) engaged on behalf of the Commission may investigate the appeal of the data subject. If the Commission does not authorize a mediator to investigate and settle the parties’ disagreement, it will conduct its investigation and render a decision. Even though filing a complaint is personal, the draft proclamation allows for a proxy. Hence, an agent can convey a client's case on her/his behalf in a written form unless the Commission requires other forms of presentation. The draft proclamation imposes a duty on the Commission to provide adequate assistance to complaints in putting their grievances in writing.<h3>What is Next?&nbsp;</h3>The draft proclamation has been completed by the Ministry of Innovation and Technology and is expected to be presented to the Council of Ministers this year. Once approved by the Council, it will pass to the House of People’s Representatives for final ratification. It will then be published in the Federal Negarit Gazette, marking its coming into force. A number of steps are expected to be taken before and after the enactment in order to operationalize the regulatory body. Creating awareness and building a legal infrastructure suitable for data protection are expected to be the biggest assignments for the government, post enactment. (1) <a href="https://www.capitalethiopia.com/news-news/first-structured-personal-data-protection-proclamation-in-the-making/">https://www.capitalethiopia.com/news-news/first-structured-personal-data-protection-proclamation-in-the-making/</a>.

Ethiopia is in the Process of Enacting a Data Protection Act 

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Ethiopia is Moving Towards Data Protection 

<h1 style="text-align:center;">RENEW’s Legal Corner: December 2021</h1>RENEW’s Legal Corner is designed to keep you updated with the regulatory progress and changes&nbsp;happening throughout the different jurisdictions in which RENEW operates. This month has seen several regulatory changes in Ethiopia, Rwanda and Uganda. Below are the highlights:<figure class="image"><img src="/uploads/097_A9519_bd9d899233.jpg"></figure>&nbsp;<hr>ETHIOPIAThe National Bank of Ethiopia Revised the Directive on the Allocation of Forex&nbsp;The National Bank of Ethiopia (NBE), which is the central bank of the country, issued a new directive on the allocation of foreign exchange. The new directive numbered FXD/77/2021 repealed Directive No. FXD/67/2020, which was issued a year ago. The new directive, similar to its predecessor, has four categories of allocation i.e. ‘1st priority', ‘2nd priority', ‘3rd priority’ and ‘no priority’. Within that framework it has introduced a few major changes:<ol><li style="text-align:justify;">Removed “input for manufacturing of pharmaceuticals” from the 1st priority category and kept medicine and laboratory agent importing intact. In addition, it introduced in the 1st priority category (1) input for manufacturing edible oil; and (2) liquified petroleum gas (LPG), which was in the 3rd category in the repealed directive.</li><li style="text-align:justify;">Similar to the repealed directive, priority categories need to be allocated a minimum of 50% of the total forex allocation by any bank at any point in time. Categorically, this used to be 5% (for 1st priority), 22.5% (for 2nd priority), 22.5% (3rd priority), which now has changed to 7.5%, 22.5%, and 20%, respectively.</li><li style="text-align:justify;">Non-priority sectors are now required to deposit 50% of the total proforma value in birr using the prevailing exchange rate at the date of registration. The bank in return is required to pay at least a saving interest rate for the amount in the blocked account, which as we stand is 7% per annum.&nbsp;</li></ol>Other than these and other minor changes, the new directive kept most of the provisions of the repealed directive. This included proceeds from the sale of shares, profit and dividend transfer, which remained in the 3rd priority category.The National Bank of Ethiopia Lifted the Restrictions on Loan ServicesThe NBE lifted the restrictions placed on all forms of private loans provided by commercial banks.&nbsp;Back in August 2021, the NBE took different policy measures to tackle the soaring inflation, which was mainly driven by the increased gap between the official and parallel forex exchange rates. This was reportedly a result of the illicit financial networks that are financing the Tigray People's Liberation Front (TPLF), a rebel group currently fighting the government. To counter that activity, the NBE had taken different monetary policy measures, one of which was freezing all forms of private loans provided by commercial banks (read our blog on <a href="https://renewcapital.com/resources/blogs/What%E2%80%99s%20Behind%20the%20Soaring%20Inflation%20in%20Ethiopia%3F">“What’s Behind the Soaring Inflation in Ethiopia?”</a>).Since then, the NBE has issued consecutive circulars at different times revising the restrictions and providing exemptions for different loan categories and strategic sectors. Beneficiaries of this exemption include companies supplying petroleum products, inter-bank loan buyout transactions, sesame producers, importers and producers of edible oil and others. Now, the NBE has lifted all restrictions and allowed all commercial banks to provide loans to their clients without restrictions. The restriction had a significant impact on the economy in general and financial institutions in particular and the lifting of the restrictions is expected to help bring the economy back on track.&nbsp;Start-up Businesses Proclamation is on the Verge of Getting EnactedAs part of the reform program introduced in Ethiopia, the government has been working on building a vibrant start-up ecosystem. Part of this initiative was to draft and implement the Start-up Businesses proclamation (the “Start-up Proclamation”).&nbsp;Initially, this initiative was being led by the Federal Jobs Creation Commission, which later on shifted to the Ministry of Innovation and Technology (MINT). Per a statement by MINT this month, the Start-up Proclamation is now&nbsp; near the finish line and is expected to be enacted within the next one hundred days. Once finalized, the law enactment process requires the draft to be presented to the Parliament through the Council of Ministers’, which will then get published in the official Federal Negarit Gazette.&nbsp;The Start-up Proclamation has a number of elements aimed at addressing the different issues that start-ups currently face in Ethiopia. These include the establishment of the National Start-up Business Council, with a number of mandates aimed at supporting the start-up ecosystem. In addition, it established an innovation fund organized for the purpose of financing start-ups and innovative businesses. At a macro level it aims to foster innovation and the economy at large and create knowledge-base wealth while at the same time fostering job creation. Specifically, it is expected to be foundational to the country’s potential for entrepreneurship and innovation, and provide tailor-made support for start-ups and innovative businesses.The Number of Sectors that Require Certificate of Competence for Business License Has Been Reduced to 10The Ministry of Trade and Regional Cooperation (MTRC) reduced the number of business areas that require competence certificates to 10 from 52. It is in a circular that was circulated to the different trade bureaus that the Ministry announced its decision.The MTRC is the central commercial registration and business licensing body of the country. However, the service provided by the Ministry used to be backward, time taking and with a number of regulatory checkpoints. This has been one of the reform areas outlined by the government in its recent economic reform program related to ease of starting a business (read our <a href="https://renewcapital.com/resources/blogs/The%20Ethiopian%20Business%20Environment%20in%20Light%20of%20the%20Homegrown%20Economic%20Reform%20Program">blog on the reform program</a>). This has seen the number of sectors that require a competence certificate from 1,300 to 52.&nbsp;Now this again got reduced to 10, which is a positive development in terms of limiting the competence certificate to areas that are necessary for the government to ensure the safety and public health of the general public.<hr>RWANDAResolution to Address Inequalities Between Men and Women in EAC Services.The women caucus in the East African Community (EAC) regional parliament recently tabled a&nbsp; resolution to check the glaring inequalities between men and women currently serving under the EAC. This came during the annual international campaign against gender-based violence. The resolution implores the EAC Council of Ministers, the central decision-making and governing organ of the EAC, to establish structures to promote gender mainstreaming in the appointment and recruitment for all organs and institutions.&nbsp;The six key recommendations include:<ul><li>Gender should be a primary factor to consider by direct partner states while appointing candidates for Secretary General, Deputy Secretaries General, judges and members of Boards.</li><li>A gender audit to be conducted to advance gender mainstreaming.</li><li>Implement regulation 20(12) of the EAC staff rules and regulations and prioritize gender during the recruitment process of professional staff.</li><li>Incorporate affirmative action for women during the recruitment process.</li><li>Emphasis on women applying for the job vacancies advertised.</li><li>Create a conducive environment for women working in the EAC, taking into account specific needs for women including breastfeeding facilities, adequate maternity leave, day care centres, affordable education for children, favorable spouse allowance and an environment free from sexual and gender-based violence.</li></ul>Senate Summons Prime Minister Over Issues in Agriculture ExportsThe Prime Minister of the Republic of Rwanda has been summoned to appear before the senate committee on economic development and finance. The main subject of scrutiny will be the state of the agricultural sector, the country’s biggest contributor to the national economy. Hon. Édouard Ngirente will explain the government’s detailed plan to leverage the recent strategic partnerships with the likes of China and UAE with close support from the Ministry of Agriculture and the National Agricultural Export Development Board. Furthermore, there will be an in depth analysis of the recurrent challenges that the agricultural export market is currently facing in Rwanda like the lack of access to capital for farmers to cover the day to day activities and logistical issues among others.<hr>UGANDAThe National Social Security Fund (“NSSF”) is the monopoly in the pension sector in Uganda, with mandatory contributions for employees (if employers employ more than five staff).&nbsp;The Parliament of Uganda has passed the National Social Security Fund Amendment Bill 2021, that allows for 20% mid term access for workers who have saved for over 10 years and have reached the age of 45, with persons with disabilities who have saved for more than five years having access to up to 50% of their savings. Furthermore, the bill provides for mandatory registration and contribution to a licensed retirement benefits scheme such as NSSF, for both employers and employees in the formal sector. The Bill also provides for voluntary contributions for employers and employees within the informal sector.NSSF is a lead investor in the only locally domiciled and registered private equity firm in Uganda. With an increase in contributions from employers and employees in Uganda, there is an opportunity for private equity funds to raise capital from the NSSF.&nbsp;Photo by Imran Mazar