Nairobi — It's the economy, stupid. This is the simple slogan - coined by his campaign strategist James Carville - on which Bill Clinton rode to the US presidency in 1992.

But closer home and almost 20 years later, various companies in the East African region seem to be borrowing a leaf from the former US president's book as they raise funds for different reasons "except the economy."

"Whatever reasons they (company executives) are giving about their need for additional capital, they are simply positioning themselves in readiness for the improving economy across the region," said Mr Peter Wachira, a senior investment manager at PineBridge Investments, formerly AIG Investments.

"Given the low interest rates, so much liquidity in the market, good results by various companies, including stockbrokers, there are signs that the regional economies are on the verge of a takeoff, which is the right time for any company to expand its operations," said Mr Fred Mweni, the managing director of Tsavo Securities.

With the EAC Common Market Protocol coming into force last July 1, economic prospects of the five-member state regional trading bloc with a population of 120 million look even brighter despite developments on the political front such as Kenya's August 4 draft constitution referendum.

Coming in the wake of the global financial crisis, a prolonged drought and, for Kenya, the post-election violence, a sense of optimism is sweeping across the region.

"Of all regions in Africa, the EAC, through remarkable commercial, historical and cultural synergies, offers the most alluring chance of success in its integration initiatives," the economists at Standard Bank of South Africa, operating in Kenya as CfC Stanbic, said.

But they are not alone. In April this year, the International Monetary Fund projected that in 2010, Kenya, East Africa's biggest economy, will grow by 4.1 per cent, Uganda, 5.6 per cent, Tanzania, 6.2 per cent, Rwanda, 5.4 per cent, and Burundi, 3.9 per cent.

Not surprising

And last week, analysts at PineBridge Investments, reviewed some of the projections with Kenya's economy now expected to grow at 5 per cent, Uganda, 6.3 per cent and Burundi, 3.8 per cent even in the face of the recent controversial elections in Burundi and the forthcoming ones in Uganda.

It is not surprising, therefore, that while to many KCB Group's Sh15 billion fund raising through a rights issue is meant to reduce the pressure on its balance sheet, the region's economic dynamics is the bank's key driver.

"It is true that the positive economic outlook in the region will help create opportunities for us to deploy new capital to grow our market share in key segments," KCB chief executive officer, Martin Oduor-Otieno, told Sunday Nation.

The bank, which is the biggest in the region in terms of assets, has operations in Kenya, Uganda, Tanzania, Rwanda and Southern Sudan.

In a similar move, Kenya Airways and majority shareholder, Mr Michael Shirima, are diluting their shareholding in Tanzania airline, Precision Air, through an initial public offering to raise Sh2 billion.

The funds will be spent on acquiring new planes for route expansion to tap into opportunities created by enhanced regional integration and demand for freight services amid economic expansion.

The same applies to Kenya's third largest cement firm, Athi River Mining.

Although the proceeds of its five-year equity-linked bond for Sh1.2 billion, which was 60 per cent oversubscribed is meant to complete the Sh1 billion-cement plant in Tanga, Tanzania, they have an eye on the economy.

"With East African economies growing at an average rate of five per cent plus and demand for cement growing at double digit rate, we are investing to expand our capacity designed to meet the future growth for the next seven years," ARM managing director, Pradeep Paunrana, said in reference to the plant due for completion in early next year.

Increase capacity

And as the perception-sensitive global tourism industry shows signs of recovery, key sector players are also angling themselves for a piece of the cake.

Subject to regulatory approvals, TPS East Africa, the owners of the Serena Hotels, is planning to raise over Sh1.2 billion from shareholders and other long-term financing sources to consolidate its presence in the region.

The money will be used to upgrade and increase capacity of Nairobi Serena over the next three years and acquire a majority stake in Upekee Lodges and the assets of Mbuzi Mawe Tented Camp in Tanzania.