After much anticipation, the African Continental Free Trade Area (AfCFTA) launched on 1 January 2021. Hailed as a catalyst for continental integration, the agreement aims to "create a single market for goods and services, facilitate the movement of persons, and promote industrial development and sustainable and inclusive socio-economic growth on the continent". However, experts caution that full implementation of the historic pact, signed in March 2018 at the AU Kigali Summit, may take years to materialise. The previous deadline for operationalising the AfCFTA was 1 July 2020, but it was pushed out to the new year after the pandemic made in-person negotiations impossible. If implemented fully, the agreement is expected to provide an economic boost of US$3.4 trillion to the continent, which is even more critical given the socioeconomic impact COVID-19 is having across Africa. Nevertheless, the truth remains that it will only live up to its potential if the benefits from intracontinental trade are inclusive for all Africans. While the AfCFTA promises to boost intra-Africa trade as whole, little is said on the impact it will have on Informal Cross Border Trade (ICBT) which is pre-dominantly led by women. Globally, ICBT is defined as trade between neighbouring countries conducted by vulnerable, small, unregistered traders. The Southern African Development Community (SADC) defines it as “businesses operating in goods and services that trades across the border, which have no official export/import license or permit within a defined threshold and frequency”. For Africa’s most vulnerable people such as women and youth, who usually constitute the majority of informal cross border traders, ICBT...

Export commodities such as coffee, tea, sisal, cotton, pyrethrum and horticulture produce are Kenya’s key sources of foreign exchange. Highly regarded in the international market, the commodities are key in deepening rural development and wealth creation among farmers.  However, performance dipped following imposition of external conditions –Structural Adjustment Programmes (SAPs) by the World Bank and International Monetary Fund (IMF) in the early 1980s, followed by poor management. Our writer NICHOLAS WAITATHU engaged the Agriculture and Food Authority acting Director General ANTHONY MURITHII on what the Government is doing to restore the sub-sector. Experts:  Question: Explain the current performance of export commodities – coffee, tea, sisal, cotton, pyrethrum and horticulture products - compared to the last three decades. Answer: Different crops have undergone unique growth trends, opportunities and challenges. Others have recorded phenomenal growth in production, while some have registered a worrying decline. Reasons for growth/decline can be attributed to a combination of factors, both global and local. Tea and horticulture have maintained an upward growth trajectory over the years, while coffee, pyrethrum and cotton have experienced significant decline. Q: Do these commodities still enjoy a good reputation in the global market amid declining production and climate change shocks?  A: Despite the decline in production, Kenyan coffee is highly sought after in the global market on the account of its quality. The challenges that the sub-sector has faced are mainly local, including poor governance in the value chain. It is these challenges that are being addressed through the ongoing reform process. Q: Do you think Kenya can reclaim...

The Rwandan government has identified opportunities in several local products for exports under the recently launched Africa Continental Free Trade Area. Among the products that have been found to be market-ready, according to The Ministry of Trade and Industry include agro-processing products including tea, coffee, cereals as well as diary, animal and vegetable oil products. Other products that are export-ready according to the Ministry of Trade and Industry include products from mining operations including ores and base metals. Rwanda is also looking to export construction materials, agro-products, hides and skins and textiles. The products are expected to drive Rwanda’s exports to the African continent from the current $1.6 billion annually to about $5 billion in 10 years. The products being targeted for exports under the new regime are largely those that have significant production and have been among the top exports from Rwanda. Rwanda’s tea and coffee production has been increasing steadily over time and are mostly exported to the Middle East and Europe. The development could see the products enter new markets on the continent which have previously had high tariffs limiting exporters’ interest. Michel Sebera, the Permanent Secretary at the Ministry of Trade and Industry, said following consultations to identify market-ready products and will be working with producers to support exports. The Private Sector Federation told The New Times that they are working with local firms to enable them meet standards and compliance requirements. “We are working with standard organisations like Rwanda Standards Bureau and the Food and Drug Authority to...

The World Bank has said in a new report that corruption and red tape are some of the factors that are turning Kenya into a graveyard for start-up businesses. Other factors turning Kenya into an innovation desert, to paraphrase the words of South Sudanese poet Taban Loli Yong, include entry barriers, large presence of State-owned enterprises (SOEs) and State-linked enterprises, and high levels of informality. The government has also been borrowing heavily, thus crowding out the private sector and making it difficult for small businesses to get credit. Instead, Kenya’s productivity continues to be driven by incumbent, mostly large firms and farms, some which have been around since independence. This damning report comes at a time when many Kenyans are eager to start businesses after being rendered jobless by the Covid-19 pandemic. These people need to be supported by the government through an enabling business environment for them to thrive. Ironically, the country has made major steps in easing the business environment, according to a World Bank ranking. In his seventh State of the Nation address, President Uhuru Kenyatta noted that Kenya had made an 80-slot improvement since 2014, with the country currently ranked 56th globally and ranking third in sub-Saharan Africa on the Ease of Doing Business Global Ranking Report. This is from a low of 136th globally in 2014. The president noted that Kenya now ranks first in protecting minority investors and fourth globally on getting credit. Last year, while Covid-19 was still raging, Uhuru added that the...

A regional business umbrella body has called for the harmonization of covid-19 charges to boost intra EAC trade. The East African Business Council (EABC) said that in a bid to ease the cost of doing business and boost intra-EAC trade emerging costs such as the COVID-19 related charges in the East African Community should be standardized. This is set to support businesses to be more resilient and rebound amidst the COVID-19 pandemic. This comes days after Kenya’s prosident Uhuru Kenyatta called on African leaders to harmonise Covid-19 protocols. According to the president, harmonising the protocols will determine whether the African Union (AU) meetings will be virtual or physical given the challenges occasioned by the COVID-19 pandemic. Currently, Covid-19 tests are priced differently in each Partner State EAC Partner States, while containment measures are varied. For instance; Tanzania and Burundi are now charging a standard rate of $100 for both nationals and foreigners while the other Partner States’ charges vary. “The EAC Secretariat should fast track regional coordination and harmonization of measures on COVID-19 for economic resilience and growth of the EAC bloc,” said Dr. Mathuki, CEO EABC. Dr. Mathuki also called for the establishment of a common quarantine period in the region and fast-tracking of the waiting time for Covid-19 test results. Also Read: Kenya’s president calls on African leaders to harmonise Covid protocols The lack of harmonization of Covid-19 testing rates in accredited laboratories and uncoordinated waiting time for the test results is disrupting cross-border trade. COVID-19 related Non-Tariff...

MON 18 JAN, 2021-theGBJournal- The Nigeria Office for Trade Negotiations (NOTN) has outlined requisite steps for Nigerian exporters gearing to begin exporting to other African Continental Free Trade Area (AfCFTA) countries as member states kick-start trading activities. NOTN the institutional framework and foundation for Nigeria’s trade policy infrastructure, leads, manages and co-ordinates all trade negations for Nigeria. According to NOTN, exporters or agent must secure all necessary licences, permits, certificates and necessary documents from relevant agencies like NEPC, SON, NAFDAC, NAQS and others and ensure that the product qualifies for export under AfCFTA. Next step is to create a bill of entry, attach all relevant permits from government agencies and secure reservation with shipping or airline company and apply for Nigeria Customs Service, AfCFTA Certificate of Origin after paying a fee. NOTN said, the Nigeria Customs Service is the issuer of the certificate, ‘’however, NACCIMA must vet the application.’’ Other accompanying documents required for shipment under AfCFTA trading activities include certificate of origin, Nigeria Customs Bill of Entry, Bill of Lading, Commercial Invoice, Packing list, and Certificate of analysis. The Trade Negotiation Office also listed Supplier/Producer’s declaration form, Origin of Declaration form, and Certificate of Origin as the compulsory trading documents. President Muhammadu Buhari on Sunday, 7th July, 2019, at the 12th Extraordinary Summit of African Union (AU) Heads of State and Government, in Niamey, Niger Republic, signed the agreement establishing the African Continental Free Trade Area (AfCFTA), involving 54 countries. The AfCFTA aims to create a single continental market...

Summary Cross border trade between Uganda and South Sudan has become difficult because of the requirements including possession of a Covid-19 certificate which is expensive. It has been close to a decade and a half of prosperous trade. Despite South Sudan’s disruptions, it has been a major trade partner, taking up a large chunk of Uganda’s formal and informal exports. According to a March 2020 Ministry of Finance report, Uganda in February 2020 had a $54.9m (about Shs199.6b) trade surplus with the rest of the East African Community (EAC) with South Sudan contributing big to the surplus. Apart from Kenya, Uganda exported more goods to South Sudan, with the country becoming the second biggest trade partner in the region. “On a country specific level, Uganda traded at surplus with all East African partner states except Tanzania. Kenya remained the biggest destination of Uganda’s exports. South Sudan was the second largest in February 2020,” the report notes. The Uganda-South Sudan trade has been growing, albeit, with some challenges but the optimism has got many stakeholders thinking. Many, including the government and international partners have come up with a number of measures to not only ease trade but also support the growth. For instance, in February 2020, a $5m one stop border post (OSBP), was completed under the support of the UK’s Commonwealth and Development Office channeled through TradeMark Africa. At the handover of the facility, Trade Minister Ms Amelia Kyambadde, said even though trade between Uganda and South Sudan had declined...

The coronavirus has emphasised the importance of the agriculture sector in South Africa and across Africa because of its potential to support economic growth, create and sustain jobs and boost exports. At a time when most industries will be reducing employment, it is hoped that agriculture will at least maintain employment in primary activities. Agriculture has kept employment levels going because by nature, it is a labour-intensive sector, employing for example nearly 900 000 people in SA directly. There are many agricultural sectors that are increasing employment now, although seasonal, such as the fruit export sector. We have clients that are currently expanding employment to cater for seasonal expansion. Another reason why agriculture must be emphasised is because of its employment ability – agriculture on a commercial level has a strong employment multiplier. This will assist in alleviating poverty and even the establishment of new businesses and investment. It is a proven fact that food production and availability is of strategic importance to any country, but this crisis has shown the importance of being food secure, meaning being able to produce the bulk of your staple food requirements. What is important is not only the production of food, but also the logistics and supply chain to make this food available at affordable prices throughout a population. In this regard the role of the informal sector is being illuminated. There is a complex supply chain in the informal sector, the importance of which is becoming increasingly apparent. In this respect, future...

Towards the end of 2020, Washington Post asked its readers to describe the year in a single word. The responses were as comical as they were insightful. From the hundreds of feedbacks received, “exhausting”, “lost” and “chaotic” came top as the most popular descriptions. The three words are reflective of the trouble the global community had to stumble through in the year. Individuals were drained and exhausted as they struggled to cope with the new normal and bear the brunt of the additional financial burden that came along. For students, other categories of people and even businesses whose ‘lives’ were paused, it was nothing short of a lost year. One could only marvel at the speed which the strange virus threw countries, businesses and individuals into unprecedented pandemonium. Perhaps, “chaotic” was the most suitable description but “exhausting” won the word-popularity contest. And by mid-2020, it was already clear that 2021 would be a transitioning year. Certainly, the COVID-19 will continue to change the social landscape and human relations but the character of the new world it will unveil, many experts have argued, is still fluid and uncertain. Hence, a mathematician, perhaps, would label 2021 as undefined. To show that the world is not ready to bet in 2021, economic projections (by most credible institutions) are largely conditioned by the character of the new strain of COVID-19, global response to the second wave as well as vaccine logistics/distribution. For instance, the World Bank, last week, projected global economic growth of four...

On 1st January 2021, trading under the African Continental Free Trade Area (AfCFTA) Agreement commenced after months of delays caused by the COVID-19 pandemic. The AfCFTA aims to bring together 1.3 billion people in a $3.4 trillion economic bloc, making it the largest free trade area since the establishment of the World Trade Organization. Ghana is hosting the AfCFTA Secretariat in its capital city, Accra. A pathway to achieving development goals If African countries enhance competitiveness through trade and create more efficient regional value chains and labour markets, as envisaged in the AfCFTA Agreement, they would increase momentum towards implementing the 2030 Agenda for Sustainable Development. Poverty and inequality would be greatly reduced through sustainable structural transformation that prioritizes reaching those farthest behind. In addition, the expansion of choices and capabilities for women and youth through intra-Africa trade and interconnectivity would help to achieve several goals under the Agenda 2063 of the African Union, including Goal 4 on transformed economies through sustainable and inclusive economic growth, Goal 17 on full gender equality in all spheres of life and Goal 18 on engaged and empowered youth and children. The AfCFTA as a driver of structural transformation and job creation The AfCFTA could transform Africa's economic landscape and create productive opportunities. The potential increase in manufacturing jobs, commercial enterprises and agribusinesses could change the lives of millions of women and youth who often face higher levels of unemployment and are overrepresented in vulnerable jobs. According to the United Nations Economic Commission for...