Summary When well utilised, technology and online market places can drive inclusive growth across Africa, with e-commerce likely to create as many as three million jobs by 2025. Ditching outmoded business models for e-commerce will drive intra-regional trade to new business markets and fasttrack the implementation of the AfCFTA. Young people in Africa could unlock the benefits of the Africa Continental Free Trade Area (AfCFTA) through e-commerce, which accounts for global online sales worth $26 million. The trading bloc comes into force in January 2021. However, even as e-commerce is touted as the panacea for growth of trade in Africa, countries are being warned about the sector’s legal hurdles. When well utilised, technology and online market places can drive inclusive growth across Africa, with e-commerce likely to create as many as three million jobs by 2025. This is according to a recent virtual meeting on Trade Beyond Covid-19: Unpacking the AfCFTA for East Africa. The meeting, hosted by the International Trade Centre (ITC) — the joint agency of the World Trade Organisation and the United Nations — was attended by government officials and other private business partners from around Africa. ITC executive director Pamela Coke-Hamilton said there is a need for African countries to incorporate technology in their trading programmes and should learn from regional blocs such as the East African Community (EAC), the Southern African Development Community (SADC), the Economic Community of West African States (Ecowas). She said the opportunities and challenges of e-commerce in Africa interplay with other...

NAIROBI, KENYA: Kenyan manufacturers have launched standards aimed at enhancing efficiency and accountability at the ports and border points in the country. The Standard Operating Procedures (SOPs) developed by the Kenya Association of Manufacturers (KAM) seek to ensure better and more efficient entry operations to facilitate trade and enhance the fight against illicit trade. Cabinet Secretary, Ministry of Industrialization, Trade, and Enterprise Development Betty Maina highlighted the Government’s commitment to sustain the fight against illicit trade in the country, adding that the vice poses a great threat to the realisation of the Government’s Big 4 Agenda. "Our ports and other points of entry play a fundamental role in facilitating global trade. The development of these SOPs is therefore an integral part of a successful quality system. They will provide information to perform a job properly and consistently to achieve pre-determined specification and a quality end-result," said CS Maina. "Sustaining the fight against various forms of illicit trade shall enhance the realization of the Government’s Big 4 Agenda," she added. Fridah Kaberia, the acting Executive Director, Anti-Counterfeit Authority noted that "The fight against illicit trade must be enhanced and intensified. This is an attempt to bring all actors to harmonize work and reduce delays for the benefit of agencies, and manufacturers." KAM Chairman Mucai Kunyiha said the enhanced Public and Private sector partnerships will go a long way in ensuring that there is sustainability in the fight against the various forms of illicit trade in Kenya, "The lack of harmonized Standard...

The new-look Mombasa Port, which is Eastern and Central Africa’s regional hub, has registered significant progress in modernisation and competitiveness. An ongoing Ksh334 billion Kenya Ports Authority investment program envisages that Mombasa Port will have an annual capacity to handle 110 million tonnes of cargo by 2040. The port is now one of the best equipped in the continent, boasting of 13 ships to Shore Gantry Cranes (SGC), 50 rubber Tyred Gantry Cranes (TGC) and 78 terminal tractors. It remains the most well-connected port in the entire region with 33 shipping lines calling and providing direct connectivity to over 80 ports. The mass expansion project and modernisation of the port has enhanced regional trade between Kenya and its neighbors. It currently ranked 5th in Africa in terms of cargo volume. The five African ports currently ranked higher are: Tanger Med port in Tangier, Morrocco, Port Said in Egypt, Port of Durban in South Africa and Lagos Port Complex in Nigeria. Transshipment container traffic at the port of Mombasa jumped 74% in 2019, buoyed by a strong performance in the second-half of the year, raising Kenya’s hope of consolidating its grip as the preferred gateway to the region. Data by the KPA shows that the Mombasa Port handled a transshipment (goods destined for other ports) traffic of 211,204 twenty-foot equivalent units (TEU) in 2019, compared to 121,577 the previous year. The port has since embarked on the construction of a second container terminal with a capacity of 550,000 TEU as well as the construction of a...

Summary Countries need to grow and spur economic growth including creating new wealth, without which there is limited public revenue, yet expenditure continues as governments have to provide public services. Co-operation is critical. Putting resources together as well as sharing information to make sure countries have a common objective in keeping the flow of trade going. Mama Keita, United Nations Economic Commission for Africa (UNECA) director for eastern Africa, shared insights into impacts of the pandemic and ongoing negotiations of the continental free trade bloc with Berna Namata. Rising debt levels in Africa remain a constant concern as countries borrow to deal with the pandemic. While some are benefiting from debt relief, many others face the risk of defaulting. How can this be addressed? Countries need to grow and spur economic growth including creating new wealth, without which there is limited public revenue, yet expenditure continues as governments have to provide public services. Public resources will reduce if the economy is not growing. For countries to achieve growth, first countries need internal rigorous discipline in containing the pandemic; resorting to strict lockdown again means economic contraction and no growth which will reduce public revenues. If you do not create growth, you face the same poverty issues, so we need to find means to keep the economies growing. Externally, we hope the newly-developed vaccine will be made available to contain the pandemic so that all economies can return to normal. The G20 has come up with a new initiative to support countries...

While the size of the global chocolate market is valued at more than $100bn, only ~5% of this market is captured by Africa; whereas 70% of the world’s cocoa production comes from the African continent, namely from Cote d’Ivoire, Ghana, Nigeria and Cameroon. This example emphasizes the crucial role of industrialization in boosting economic activity along value chains; shifting from over dependence on raw material to higher value-added goods. Furthermore, industrialization is closely linked to economic and social development: it enhances productivity, innovation and economic diversification, and contributes to a rise in the workforce education as well as formal employment. As of 2019, industry generated on average $700 of GDP per capita in Africa, less than 30% of Latin America’s output ($2,500) and c. 20% of East Asia’s one ($3,400). Nonetheless, African economies have the opportunity to foster industrialization by capitalizing on two decades of steady GDP growth, along with an increasing young workforce, rapid urbanization, and technological development. To do so, Special Economic Zones (SEZs) have the right ingredients to achieve rapid and scaled industrialization of the African continent. SEZs are demarcated geographical areas within a country’s national boundaries, which benefit from a distinct regulatory regime. They generally provide four types of advantages to investors: (i) an access to reliable infrastructures and utilities, (ii) attractive customs regimes, (iii) fiscal incentives such as corporate taxes exemptions, and (iv) enhanced regulatory and administrative frameworks. From ~500 in 1955, SEZs’ number has risen to ~5,400 in 2019 worldwide, with Asia counting for three quarters...

With less than a month to the African Continental Free Trade Area coming into effect, the East African Community submitted its tariff offer on December 3, beating the December 5 deadline. EAC’s tariff offer now brings the number of countries to 40 that are ready to join the continent-wide duty-free quota-free movement of goods on January 1, when trading under the AfCFTA agreement starts. By press time on Friday, 14 countries that had signed the agreement had not yet submitted their tariff offers. These are Algeria, Angola, Comoros, Djibouti, Eritrea, Ethiopia, Libya, Morocco, Mozambique, Saharawi Republic, Somalia, Sudan, Tunisia and Zimbabwe. “EAC has submitted both the tariff offers and schedule of commitments on trade in services,” Kenneth Bagamuhunda, the EAC director general of Trade and Customs, told The EastAfrican. The EAC had missed previous deadlines as the bloc was putting together its offer that addresses the trading regimes of different partners such as Ethiopia, DRC and Sudan. The EAC overcame delays and several deadlines that risked making it the only Customs Union and Single Customs Territory that would have been locked out of the intra-Africa trade. The Economic Community of West African States (Ecowas) submitted its tariff offer on December 2. Prudence Sebahizi, the head of AfCFTA Negotiations Support Unit at the African Union Commission confirmed that EAC’s offer was received on time. Dispatch The EAC Council of Ministers, which met on November 2 under the Sectoral Council on Trade, Industry, Finance and Investment, directed that partner states experts meet...

African Union Heads of State and Government have underscored the urgent need for member states to kick-start trading activities, under the African Continental Free Trade Area (AfCFTA). The decision was adopted during a virtual meeting of the 13th Extra Ordinary Session of the Assembly of the Union on the AfCFTA, this past Saturday, under the Chairmanship of Cyril Ramaphosa, President of South Africa and Chairperson of the African Union (AU). The summit is taking place just four weeks before the AfCFTA commences trading on January 1, 2021, to consider the adoption of the legal instruments that will facilitate its operation. “Today we stand on the cusp of a new era in the progress of our continent,” said Ramaphosa, adding, “The moment that we have all been working painstakingly towards has finally arrived…We are all filled with a great sense of pride at how far we have come to reach this moment”. All 55 member states of the African Union will be brought together by AfCFTA which allows for market covering of over 1.2 billion people not limiting the growing middle class, and a collective gross domestic product of over US$3.4 trillion. This also makes AfCFTA the world’s biggest free trade area after the establishment of World Trade organisation. AfCFTA has the ability to enhance intra-African trade by 52.3 percent by removing import duties, and also to double this trade if non-tariff barriers are also reduced. AfCFTA seeks to create and achieve unilateral continental market for goods and services, with free...

Addis Ababa, 27 November 2020 (ECA) – Africa’s customs experts have given their support to the adoption of continental guidelines to facilitate free and timely flow of cross-border trade amid the COVID-19 pandemic ahead of the start of trading under the African Continental Free Trade Area (AfCFTA) on 1 January 2021. They made the pledge at a virtual meeting of Directors General of Customs on the continent organized by the African Union Commission (AUC) today, saying that the solutions must be maintained and upgraded following the crisis. The meeting observed that by magnifying Africa’s cross-border inefficiencies, the corona virus pandemic presented an opportunity to reinvigorate efforts at overcoming long-standing trade facilitation challenges. Presenting the guidelines, Mr. Stephen Karingi, ECA’s Director of Regional Integration and Trade, said they were designed to support cross-REC harmonization of Covid-19 guidelines and advance coordination and implementation of common guidelines. He said they would be presented to all relevant AU sub-committees covering customs, transport and infrastructure, among others, for consideration towards their eventual adoption. “The aim is to have the continental guidelines in place early next year to reinforce start of trading under the AfCFTA,” he said. The guidelines cover a number of new sub-sections to respond to specific gaps in existing rules, including the regulation of small-scale cross-border trade and cross-border trade by fishermen, gender considerations, and treatment of essential workers, including transport and humanitarian workers. In his own remarks, AUC’s Acting Director for Trade and Industry Mr. Hussein Hassan said the Commission partnered with...

The Rusumo OSBP is a strategic border point for the EAC as it accounts for over 80% of imports into Rwanda through the Dar-es-Salaam port via the post. The East African Business Council (EABC) is urging for the harmonization of inspection charges by Trade Facilitation Agencies along the Rusumo OSBP, (Rwanda-Tanzania) which it said is increasing the cost of doing business. The current USD 35 being levied on each truck entering Rwanda, as facilitation fees for accommodation and refreshments for truck drivers, in COVID-19 isolation centers is likely to adversely affect the cost of doing business. Instead, we should make use of the existing GPS monitoring, which was set to replace testing of COVID-19 at the border points. The position follows EABC’s visits at the Rusumo One-Stop Border Post (OSBP) today, aiming at seeking sustainable solutions to issues hampering trade EAC across borders. In a meeting with the Rusumo Joint Border Management Committee (BMC), the business community also urged for harmonization and reduction of quality inspection fees charged on goods by the Food and Drugs Authority in Rwanda and fast-tracking the issuance of chemical permits by Tanzanian Authorities to reduce transit time at the border. The meeting also appealed to all the EAC Partner States to expedite harmonization on issuance, recognition and use of national identity cards as travel documents in a bid to facilitate cross border trade. The Rusumo OSBP is a strategic border point for the EAC as it accounts for over 80% of imports into Rwanda through...

THE East African Women in Business Platform (EAWiBP) has partnered with East African Community (EAC) Secretariat to launch the project on value addition for increased market access in the Moringa products. The project is being funded by Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH through the Intra-Regional Trade Facility Initiative (IRTF). The EAC Secretariat Principal Gender and Community Development Officer, Ms Generose Minani said the East African Community Treaty and 5th EAC Development Strategy outline EAC commitment in promoting women in socio-economic development and in business. “The EAWiBP project on value addition for increased market access in the agro-processing sector, connecting and linking women in moringa business across the three EAC Partner States of Tanzania, Uganda and Kenya, contributes directly to this goal,” she said. The training workshop held in Dar es Salaam recently included women in the moringa value chain from Tanzania, Kenya and Uganda on branding, packaging and standard certification. The project engages and supports women in Moringa production and trade and focuses on improving competitiveness and strengthening value addition for moringa products for easy market access. “The EAC has developed a policy framework to promote the participation of women in intra-regional trade, such as the EAC Gender Policy 2018 and the draft regional strategy for promoting women in business for socio-economic development, 2015 – 2025,” said Ms Minani. EAWiBP Chair Person Ms. Angela Begaine, said as a result of the implementation of this project, national associations of moringa producers and traders had been established in Tanzania (Tanzania...