Country: EAC

Digital Innovation and Regional Collaboration Essential Drivers to Transforming Africa’s Trade Future

The recent commemoration of the 25th Anniversary of the East African Community (EAC) offered an excellent opportunity to reflect on its achievements, confront persistent challenges, and outline the path forward for advancing regional integration. A notable focus of the celebration was the role of digital innovation in addressing cross-border payment inefficiencies, with technologies such as artificial intelligence, mobile money, and digital currencies emerging as critical enablers. Coinciding with this milestone, the Africa Trade Development Forum (ATDF) was held in Kigali, Rwanda, from 2 to 3 December 2024. Co- organised by the Government of Rwanda and TradeMark Africa (TMA), the forum brought global trade leaders, policy makers, private sector representatives, researchers, and innovators to reimagine the transformative potential of digital solutions in redefining trade. Both events emphasised the need for actionable strategies to strengthen intra-regional trade through enhanced collaboration. Regional cooperation emerged as a key driver of economic growth, with the EAC commended for its leadership in promoting intra-African trade. Since 2010, TMA has worked to reduce trade barriers and modernise trade systems within the EAC. Its collaboration with the EAC has delivered 15 One-Stop Border Posts (OSBPs), reducing transit times by 16.5% along the Northern Corridor from Mombasa to Bujumbura and cutting crossing times by up to 70% at key border points. These improvements have significantly enhanced regional connectivity and efficiency. Digital transformation has been central to TMA’s approach, with initiatives such as the Single Customs Territory introducing electronic cargo tracking system, digital certificates of origin, and customs modernisation. The...

TradeMark Africa Receives $63 Million from Netherlands to Advance Sustainable Trade and Economic Inclusivity

Nairobi, 8 February: The Government of the Netherlands, through its Ministry of Foreign Affairs, in a significant boost to global trade development, has announced a $63 million funding to TradeMark Africa, a leading aid-for-trade organisation. This strategic investment will fuel TradeMark Africa's Strategy 3, covering the period till 2030, aimed at driving green, sustainable economic growth, fostering innovative trade practices, and promoting inclusive trade across Africa. This move underscores the Netherlands' commitment to enhancing economic opportunities, job creation and facilitating sustainable trade throughout the continent. Marchel Gerrmann, Ambassador for Business and Development Cooperation at Netherlands Ministry of Foreign Affairs, said: “TradeMark Africa will significantly contribute to a more inclusive and prosperous trade landscape for the African continent, benefitting both African and Dutch businesses." The Netherlands’ contribution will be invested in strengthening trade systems so that they benefit local exporters, foster economic growth, and create sustainable livelihoods across diverse sectors. This investment will be instrumental in improving market access for local products at the global level, in addition to bolstering initiatives that drive innovation, research, and development within the African market, enhancing competitiveness and green trading practices. As part of its Africa Strategy, the Netherlands contributes towards the implementation of the African Continental Free Trade Area (AfCFTA). The AfCFTA is expected to boost intra-African trade over 30% by 2045 and is projected to provide an average extra 2.7% GDP boost across the continent. The AfCFTA could lift 30 million Africans out of poverty by 2035, offering market opportunities to both African...

The European Union (EU) Keen to Deepen Trade Ties with Kenya

Members of European Parliament’s International Trade Committee, on November 3, 2022, held talks with teams from TradeMark East Africa, Kenya’s Ministry of Trade and regional private sector representatives on investment opportunities, trade relations and barriers. Led by committee chair, Bernd Lange, the team sought to understand key concerns around the interim Economic Partnership Agreement (EPA) between Kenya and the EU and how trading between the two partners can be more mutually beneficial. Mr. Lange also highlighted the need to reflect on a regional perspective in the negotiations with Kenya, which is no longer categorised as a least developed country (LDC) as its East African Community (EAC) counterparts. While the country’s exports still benefit from preferential treatment, Kenyan exporters face stringent requirements on labelling, rules of origin and phytosanitary standards, according to the State Department of Trade. In the last half a decade, Kenya has been a net buyer of commodities from the EU, with imports hitting US$1.9 billion in 2019, less than half of the US$916 million Kenya exported to the EU, according to the Overseas Development Institute (ODI). Kenya exports mostly horticultural products. With favourable trade conditions and increased efficiencies in the production and supply chains, Kenya can significantly scale up its share of exports of cut flowers, vegetables, macadamia, avocados, sweet potatoes, pineapples, coffee, and apparel, in response to burgeoning demand in the EU. The delegation also heard of how Kenya and East Africa are positioned to tap into the immense potential of the African Continental Free Trade...

Combating COVID-19 and Supporting Recovery

The COVID-19 pandemic has shaken the globe and disrupted the lives of billions of people in every corner of the world. Eastern Africa has not been left unscathed. The pandemic has affected trade and economic activity in a fundamental way. Whereas many have weighed the impact of COVID-19 on health terms, we in trade facilitation have seen firsthand how debilitating its impact has been to global trade, disrupting supply chains across the globe. This knowledge informed our quick adaptation, and helped to offset major trade disruptions experienced in the Eastern, Southern and Horn of Africa Region. The impact of COVID-19 hit TMA closer home. Cuts to donor funding caused by COVID-19 inflicted economic recession in donor countries necessitated a human resource restructuring process, and scaling down of programming. Nevertheless, TMA was resilient and delivered strong impact. I am honoured to mention a few of the interventions and associated impacts achieved in the last year, as I welcome you to read about many more in this annual report. SAFE TRADE Amongst the quick counter and cushioning measures we implemented were the Safe Trade Emergency Facility Programme (Safe Trade), a multi-donor funded and multi- stakeholder programme that enabled governments and communities to adopt short- to medium-term measures for safe continuity of trade. The innovation driving Safe Trade won an award during the Paris Peace Forum due to its focus on the immediate threat posed by the pandemic, and post- COVID-19 recovery that empowered communities to bounce back better. Recovery efforts have also...

Finland Committed to Doubling Trade with Africa Over Next Decade

Finland Ambassador to Kenya, H.E. Pirkka Tapiola says his country is committed to doubling trade with Africa over the next decade. The ambassador spoke while touring the Port of Mombasa on Friday. The envoy commended the Government of Kenya and Development Partners for supporting Port Reforms and Modernisation Programme over the last decade that has dramatically improved evacuation of cargo at the facility. It for instance used to take 11 days to process imports through Mombasa in 2010, the time had fallen to only 5.5 days by 2017. The time to transport a container from Mombasa to Bujumbura also fell by 16.5% over the period. The Government of Finland, through TradeMark Africa has over the last decade invested more than US$13.1 million to support various projects in and around the Port of Mombasa. Finland also contributed US$445,000 to provide Personal Protective Equipment (PPE) through the Safe Trade Emergency facility by TradeMark Africa, a project that sought to keep ports, borders, and critical supply chains in the region safe for trade at the height of the COVID-19 pandemic. The Ambassador was received by General Manager Human Resources and Administration Mr. Daniel Ogutu and TradeMark Africa Deputy CEO, Allen Asiimwe.  The KPA General Manager noted that the support provided at the outset of COVID-19 was critical in keeping the port running. He further noted that port output slowed down due to COVID-19-related interruptions, calling on all stakeholders to work together to address such challenges. TradeMark Africa Deputy CEO and Chief of Programmes...

East African women traders: ‘Celebrating the past, planning for the future’

COVID-19 has hit women disproportionately hard across East Africa, especially those working in the informal sector. Lessons must be learnt to prevent this from happening again. Women in East Africa can look back over recent history with a sense of struggle and accomplishment, of regression and progression. Women's activism was ingrained in many of the independence movements that took hold across the region throughout the 20th century. In many respects, East Africa has achieved greater gender parity than many other parts of the world. Rwanda's lower house in Parliament, for example, is 61 percent female, the highest proportion globally, according to its Inter-Parliamentary Union. But increased representation has not always translated to real changes for ordinary women, especially in the world of business, a historic central pillar of the global drive for equality. 'Celebrating the past…' Activist Clara Zetkin, inspired by the nascent women's movement in the US, first suggested the idea of an International Working Women's Day in 1910, which was granted official status by the UN in 1975. The inaugural theme was 'Celebrating the Past, Planning for the Future'. Today, women the world over are increasingly afforded more rights and freedoms. In Kenya, the introduction of the 'Linda Mama' insurance scheme ensures mothers can safely give birth without worrying about the financial cost. Initiatives like this will continue to lower maternal mortality rates, which saw a 49 percent drop across sub-Saharan Africa between 1990 and 2013. Across the region, all but two EAC members have achieved the 30...

Strengthen Corridors and Countries to Build Climate Resilience

As Eastern African economies continue to grow rapidly, so do the respective transport and logistics sectors, and the associated Greenhouse Gas (GHG) emissions and pollution. As we know, increased traffic and pollution threaten safety, health and life of road transport users and citizens. The situation is further worsened by inefficiencies which exist in the regions’ road transport and logistics sectors. Costs per km of transporting a freight container from Mombasa to Kigali still costs 3 times more than in developed countries. Some 95% of the freight transport is hauled on roads, while water (maritime, inland lakes) and rail transport, which are less polluting modes of freight transport have remained underdeveloped and underutilised. TradeMark Africa (TMA) has worked with the Northern and Central Corridors for years in the joint Observatories programme to collect and manage freight transport related information, and in 2018 included a climate change tool to monitor Green House Gas (GHG) emissions and pollution along the corridors. Key partners involved in the development of the international standards-based tool were Climate Care and Meghraj Capital consultants. Responsiveness to climate change challenges varies regionally and in the partner states. A lot of progress has been made in the fight against climate change at the national level with- countries being members of United Nations Framework Convention on Climate Change (UNFCCC) and signatories of the Paris agreement having formulated Nationally Determined Contributions (NDCs) and report on them through National Communications (NCs). The report on the freight transport sector tool however reveals that there...

The UK Prime Minister’s Trade Envoy Theo Clarke Virtually Visits Projects Funded by the UK in Kenya

26th February, Nairobi - United Kingdom (UK) Trade Envoy to Kenya Theo Clarke has today virtually visited projects funded by UK government in Kenya among them the Integrated Customs Management System (iCMS), Regional Electronic Cargo Tracking System (RECTS) and Regional Electronic Cargo and Driver Tracking System (RECTDS) implemented in partnership with the Kenya Revenue Authority (KRA). Speaking during the virtual visit, attended by senior government officials and officials from TradeMark Africa (TMA), through which these projects were funded, the envoy underscored the special trade relationship between Kenya and the UK. Trade between the two nations was worth Ksh 79 billion in 2019 with the trade balance in favour of Kenya. Main Kenyan exports to the UK in the year were coffee, tea and spices at Ksh 18.6 billion (£121 million), vegetables at Ksh 12.1 billion (£79 million) and live plants mainly flowers at Ksh 8.3 billion (£54 million). The UK market accounted for 43% of total exports from Kenya as well as 9% of her cut flowers. British firms sold East Africa’s leading economy goods worth Ksh 125 billion (£815 million) mainly in machinery, pharmaceuticals, and automobiles. The UK is the largest European foreign investor in Kenya, with more than 100 British firms based in Kenya among them Vodafone, BAT, Diageo, Standard Chartered Bank, GlaxoSmithKline, ACTIS, Unilever and De La Rue. The UK Prime Minister’s Trade Envoy to Kenya, Theo Clarke MP, said: “I am pleased that during the day of my first virtual visit as the Prime Minister’s Trade...

Economic diversification in East Africa: Time to redouble efforts

When the COVID-19 pandemic crisis started; most people were extremely pessimistic and predicted that the EAC region would drown in terms of trade declining catastrophically. But in fact, the East Africa Community economies (Burundi, Kenya, Rwanda, South Sudan, Tanzania, and Uganda) have, by global standards, proven to be relatively resilient. The newly launched joint report by UN Economic Commission for Africa (UNECA), TradeMark Africa (TMA) and African Economic Research Consortium (AERC) entitled “Waving or Drowning? The Impact of the COVID-19 Pandemic on East African Trade” notes that declines in imports broadly reflected the adverse trade performance of the EAC’s main trading partners during the early phases of the pandemic in April and May 2020, but the imports of all the EAC Partner States subsequently recovered to pre-pandemic levels by the second half of 2020, after governments’ lockdown restrictions were eased, and a broader global trade recovery started to take place. Nonetheless, despite showing resilience, COVID-19 has reversed some of the gains made in trade facilitation. Immediately after COVID-19 outbreak, the ship dwell time at Mombasa port increased by 48% and Berth time increased by 52%. Cargo transit from Mombasa Port to Malaba (the border between Kenya and Uganda) increased from 7 days to 11 days by the second quarter of 2020. The time taken to transport goods via the Mombasa-Busia route was nearly three times higher. On the Central Corridor, the transit time from Dar-es-Salaam to various cities in the neighbouring countries more than doubled. The marked increase in transit...

Crisis? What crisis? COVID-19 and the unexpected recovery of regional trade in East Africa

By Andrew Mold and Anthony Mveyange from Brookings institute  At the beginning of the COVID-19 pandemic, such was the scale of the economic disruption caused by lockdown measures that there was much talk of the collapse of global trade. In the midst of the lockdowns, in April, the World Trade Organization estimated that the decline would amount from anywhere between 13 and 32 percent. In a similar vein, UNCTAD was forecasting a 20 percent decline in global trade for 2020. However, recently released trade statistics across the world reveal that those forecasts may have been overly pessimistic and underestimated the relative resilience of the global trading system. In fact, in June, after several months of sharp declines, trade volumes recorded their biggest monthly rise on record, with a 7.6 percent increase. East Africa may be shadowing these global trends. Kenya, the largest regional trader, is a good barometer of broader East African trends. The country was initially hit quite hard in terms of the decline in trade volumes, with a 19 percent drop in total trade volumes in April. As warned in our earlier Brookings policy brief, re-exports to the rest of the region were hit extremely hard, with a 83 percent decline in April. Since June, though, total trade volumes have begun to recover rapidly, with a 9 percent increase in June and a 12 percent increase in July (Table 1). Moreover, the story is a similar if the analysis is undertaken using year-on-year percent changes. Table 1. Kenyan trade, percent monthly change, January-July 2020 Total exports Re-exports...