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African press review 26 November 2016

Kenya prevents an East Africa Legislative Assembly debate on the control of plastic bags. Tanzania's President John Magufuli has been explaining why he dissolved the Tanzania Revenue Authority board and sacked its chairman. And South Africa breathes a sigh of relief as the ratings agency Fitch decides to leave the country's credit status at triple B, reducing the outlook to negative.

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Opposition from manufacturers in Kenya forced the East Africa Legislative Assembly to drop a bill aimed at controlling the use of plastic bags. Plastic waste is recognised as an environmetal menace.

This is the main story in regional paper the East African.

According to the report, polythene and plastic sector producers in Kenya held a closed-door meeting on Wednesday at which it was agreed that the country should maintain its stand against the Bill, which is seen as a threat to local industry.

The legislation is intended to provide a legal framework for the preservation of a clean and healthy environment through the prohibition of manufacturing, sale, importation and use of polythene materials across East Africa.

The debate has been postponed until next year.

Tanzania tax authority board gets the boot

Tanzania's President John Magufuli has been explaining why he dissolved the Tanzania Revenue Authority board and sacked its chairman.

The president accuses the board, chaired by Bernard Mchomvu, of irregularly diverting more than 10 million euros meant for the taxman's recurrent expenditure to fixed deposit accounts in three separate banks with the intention that the money would generate interest that was to be shared among the agency's top brass.

President Magufuli has told the Minister of Education to investigate reports that the Tanzania Institute of Education had stashed away nearly 150 million euros in fixed deposit accounts.

The president said these schemes mean that the government has at times had to borrow its own money deposited with the banks by dishonest officials to implement development projects.

Fitch leaves South Africa's credit status unchanged

In South Africa the financial paper BusinessDay gives top priority to yesterday's decision by the ratings agency Fitch to leave the country's credit status at triple B, reducing the outlook to negative.

The treasury said in a statement last night that efforts made by South Africa to keep the country on an investment grade have paid off.

Fitch said on Friday it had kept the country’s rating at BBB, explaining that the outlook had been dropped due to the fact that political risks to standards of governance and policy-making had increased and would remain high at least until the electoral conference of the ANC in December 2017, negatively affecting macroeconomic performance.

The agency said in-fighting within the ANC and government was likely to continue over the next year and its view was that this would distract policymakers and lead to mixed messages that will continue to undermine the investment climate, thereby constraining the growth of Gross Domestic Product.

While the decision not to downgrade provides some relief, analysts have warned that changes to outlooks by other agencies may result in Standard & Poor's downgrading South Africa to junk status next week.

A downgrade to junk is potentially catastrophic, since it would mean many international funds would be obliged to pull investment from the country.

Electricity company already downgraded by Standard & Poor's

In a related story, BusinessDay reports that Standard & Poor's has already downgraded South African national power producer Eskom’s credit rating to double B, and kept its outlook negative.

The rating agency said Eskom was facing financial pressure due to an ongoing court case against the national energy regulator. It also said Eskom’s government guarantee of over two billion euros is due to expire in March and no decision had been made to extend it.

National Union of Metalworkers says no to Ramaphosa

In a separate story, BusinessDay reports that the National Union of Metalworkers yesterday slammed the trade union federation Cosatu’s decision to endorse Cyril Ramaphosa to replace Jacob Zuma as president of the ANC in 2017.

An ANC government led by Cyril Ramaphosa will be no better than the one led by Jacob Zuma, according to the union, which has already described multi-millionaire Ramaphosa as "an enemy of the working class".

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