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XINHUA NEWS SERVICE REPORTS FROM THE AFRICAN CONTINENT

 

Ugandan car importers reject proposed law to ban old vehicles

KAMPALA Uganda (Xinhua)-- Car dealers in Uganda are asking Parliament not to pass a law that will stop the importation of cars manufactured more than eight years ago.

Led by Marvin Ayebale, the secretary general of Associated Motor Dealers, the members petitioned Parliament on Wednesday, saying the new law would create greater demand and lower supply of vehicles into the country.

“The population is not financially ready for the proposal,” Ayebale said, adding that many Ugandans will be driven out of business if the Traffic and Road Safety Act 1998 (Amendment) Bill, 2018 is passed into law.

The same Bill also proposes that importers of cars that were manufactured five years ago or more would have to pay an environment tax.

The proposed law, however, exempts heavy vehicles such as breakdown lorries, crane lorries, road sweeper lorries, fire fighting vehicles, concrete mixer lorries, spraying lorries, mobile workshops and forklifts among others.

Armored vehicles, agricultural and forestry tractors will also be exempted.

“We are with government on the intentions of this Bill but disagree on the approach. We propose gradual phasing out of these vehicles starting with a 15-year threshold. We need to be prepared,” said Ayebale earlier before meeting the Members of Parliament.

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EARLIER REPORTS:

Uganda’s communications regulator threatens to close Pay TV operators

KAMPALA Uganda (Xinhua) -- Uganda’s communications regulator, has warned that it will close down Pay TV service operators in the country over noncompliance to a new license fee framework.

Uganda Communications Commission (UCC) said the operators have up to April 30 to pay up or risk their business closed down.

“Enforcement measures shall include but not limited to closure of broadcasting facilities and prosecution of offender(s) for illegal broadcasting in accordance with section 27 of the UCC Act 2013,” the Commission said in a statement late on Monday.

The regulator advised the public not to deal with non-compliant Pay TV broadcasting service providers to avoid inconvenience that may arise out of enforcement.

UCC said under the new television licensing framework, all the existing broadcasters are supposed to apply for new licenses. It noted that since the framework came into force in January this year, no service provider has applied for a new license.

The Pay TV service providers in a joint statement protested the move arguing that UCC took the decision arbitrarily.

The operators said UCC increased the annual license fees to 550 million shillings (around 150,000 U.S. dollars) from 22 million shillings.

They argued that the new fees would render their services unaffordable because they have to transfer the cost to their clients.

“Pay TV operators will have no choice but to pass on these increased fees to subscribers if we are to survive, which we are reluctant to do as it would make Pay TV services unaffordable and place an additional burden to consumers,” the operators said.

The operators who among others include DSTV, Gotv, Azam TV, Kwese, Star Times and Zuku satellite said they will continue to engage UCC to revise downwards the new fee.

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Uganda central bank says reforms push growth in gov’t securities by 29 pct

KAMPALA Uganda (Xinhua) -- Reforms instituted by the Bank of Uganda (BoU) have pushed up the growth in government securities by 29 percent from 2016 to 2017, the central bank said.

BoU figures show that besides the retail segment, participating banks have enhanced liquidity in the secondary market transactions; total turnover in the secondary market rose to 5.1 trillion (1.4 billion U.S. dollars) in 2017, up from 3.6 trillion (1 billion dollars) in 2016.

In October 2016, the bank launched reforms to the Primary Dealer System to make investing in government securities easier and more accessible to the public. All licensed commercial banks in Uganda have direct access to the primary market for government securities.

Primary dealers are commercial banks that buy government securities (treasury bills and bonds) directly from the central bank during the auctioning time, with the intention of reselling them to other people in the market. The primary dealers act as market maker of government securities in secondary market.

Emmanuel Tumusiime Mutebile, the central bank governor, told reporters recently that banks are all eligible to open Central Securities Depository (CSD) accounts at the BoU for their clients through a web interface on any business day.

The banks can complete client sale and purchase orders online without using the old BoU physical instrument for transferring CSD forms.

“They are all able to accept and process their clients’ bids for government securities. All banks settle their clients’ successful bids and all banks can buy their clients’ securities if the client wishes to sell in the secondary market,” he said.

Investment in Ugandan government securities is open to all investors, foreign and local. According to the BoU, like in many other frontier markets, offshore investors get higher returns on their investment in Ugandan government securities because the interest rate charged is higher.

The bank said although the rates declined in February 2018, they were expected to rise in March 2018 due to anticipated domestic financing by government.

Parliament approved 736 billion shillings (204 million dollars) supplementary budget for the 2017/18 fiscal year to be financed through the issuance of additional treasury securities. Total domestic financing amounts to 1.690 trillion shillings (over 469 million dollars).

Richard Byarugaba, director of financial market at the BoU, said offshore investors hold 4 percent of the government security in the secondary money market.

The prevailing interest charged on government securities, though lower than they were a year ago, have not discouraged foreign investors, Byarugaba said.

“The foreign investors are still actively investing in Ugandan government securities because the rates charged are still higher than those in the developed economies,” he said.

Adam Mugume, executive director of research at the BoU, said the face value of total government securities in the secondary market currently stands at 12.9 trillion shillings (about 3.6 billion dollars).

             

 

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