Moove co-founders Ladi Delano and Jide Odunsi

“A small fish going into a big pond.” 

That’s how my colleague described Moove’s latest expansion into the US. The Uber-backed Nigerian startup offers financing for ride-hailing, logistics and delivery companies, deducting a percentage of the drivers’ weekly earnings to pay for the vehicles in instalments. 

That model hit a snag in Nigeria—one of the six countries where Moove is currently present—as drivers struggled with repayments due to high living costs and inflation. But the US is every bit different from Nigeria.

With a relatively stable economy, large market size (330 million people) and reliable credit scoring systems, Moove has a chance of scoring better margins than other countries where it operated. The US has a market size that dwarfs the market size of other countries where Moove operates. 

The fintech’s move into the US is likely an all-electric vehicle one, mirroring its move to UAE where it operated an all-EV fleet.Although the US has seen a surge in EV adoption, with many affordable EVs, there is still an opportunity for Moove to thrive in the country’s $94.9 billion EV market. The company will be competing with other vehicle financing startups like Lendbuzz, Car Capital Technologies, and others. 

Moove’s move (pun unintended) into the US is its first expansion since it announced a $100 million fundraise in March. The firm hinted at an expansion into six new markets after its fundraise.

People walk at the Jomo Kenyatta International Airport on September 10, 2024. Image source: Reuters/Thomas Mukoya.

Do company leases lead to takeovers?

Kenyan aviation workers think so. Early on Wednesday, workers went on a strike over the country’s proposed deal with Indian conglomerate Adani Group to manage and run one of its most important assets: the Jomo Kenyatta International Airport (JKIA). Only one phrase was chanted in unison, “Adani must go.”

JKIA, one of Kenya’s most-booked airports, accounted for two-thirds of all Kenyan flights in 2023. When workers went on strike, thousands of passengers were unable to travel. 

These workers fear that they could lose their jobs if the airport is leased to Adani.

What happened to JKIA? In 2013, JKIA suffered a fire outbreak it still hasn’t recovered from. Though the government has put in money to renovate the airport, its runway and passenger terminal still remain in poor condition. Kenya is facing a debt crunch, and there’s little incentive to put in more money on any renovation plans, and this is where Adani’s point of interest comes in.

Adani proposed the deal in two parts: first, it will pay for repairs to fix the airport’s terminal and runway for $1.85 billion. Then, it will run the airport independently for 30 years and keep 18% of the annual returns.

While both the government and Adani preferred to keep details of the deal under wraps, news broke out that Adani, after 30 years, will keep an equity stake in the airport.

Adani, known for its acquisition expansion strategy, clearly has a long-term interest in JKIA. But turning over JKIA assets to a foreign private company looks risky. The poser here is: can Kenya instead explore other public-private partnerships where Adani can fund the project and recoup their investment from JKIA’s financial returns?

GIF Source: Tenor

The irony of Kenya’s relationship with money and debt is in how it is willing to forgo expenses in renovating one of its most important airport assets, only to turn around to reduce its tax net.

Finance minister John Mbadi plans to cut value-added tax (VAT) from 16% down to 14%, and companies will pay 5% less on corporate taxes. 

Kenya is facing a debt-sustainability crisis, and if anything, its focus should be on making sure it meets these obligations. If you’re not familiar with economics speak, it means that Kenya needs to raise more money.

Tax cuts won’t necessarily help Kenya do that. Kenya’s tax base is already short on what it owes. How will the government plug budget deficits if it cuts revenue collections?

But again, the move might also suggest that Kenya still struggles with tax compliance. As at 2021, the Kenya Revenue Authority (KRA) reported a compliance rate of 59%, less than its 65% target.

Kenya is between a hard place and a rock: it needs to raise money, but then, it is not collecting nearly enough in proposed tax amounts. Minister Mbadi thinks cutting taxes in the medium term will increase compliance.

There is only one winner here. Reduced taxes will unburden Kenyans and free up disposable income for them to spend. We could see higher consumer spending in the coming months if this is implemented. Since its bill was met with opposition in June, Kenya has been looking for ways to increase revenue.

It is also planning to introduce the eco-levy. With consumers spending more money on everyday items, the use for biodegradables like nylons as byproducts will increase. Companies that produce them will still pay more taxes on these items.

However, even with this plan, though it might appease Kenyans, it doesn’t look likely to be sustainable in the long haul.

The Ghanaian cedi

Here are some interesting events that have happened over the last three years. The Perseverance rover successfully landed on Mars, Man City won the premier league thrice, Russia invaded Ukraine and, wait for it, Ghana’s inflation dropped for the first time in almost three years. 

In a surprising turn of events, Ghana’s inflation rate for August unexpectedly fell to a 29-month low. According to the country’s Statistician Samuel Kobina Annim, the inflation figure for August was 20.4%. Over the last three years, Ghana has battled with soaring inflation rates, with inflation peaking at 54.1% in December 2022 just shy of an all-time high of 63.10% recorded in March of 2001.

Per Annim, a reduction in food prices—which make up the bulk of the consumer price index—led to a reduction in the inflation rate. Analysts expect inflation figures to fall to about fall below 20% in September, citing the stability of the cedis and the fall of oil prices. The central bank predicts a 13-17% inflation by year-end.

The recent slowdown in inflation and the relative stability of the Cedis has encouraged hopes of a cut in interest rates. Ghana’s monetary policy committee held the rate at 29% after a rate cut in January. Analysts are hopeful of a 1% reduction in interest rates. The MPC will meet later this month to decide. 

Coin Name

Current Value

Day

Month

Bitcoin
$57,405

– 0.71%

– 3.21%

Ether
$2,341

– 2.30%

– 13.61%

SUNDOG

$0.28

– 5.25%

+ 345.00%

Solana
$132.39

– 2.61%

– 8.90%