Over three million people in Tanzania and Kenya will benefit from a €345 million financing package for road construction support, approved by the African Development Bank’s (https://www.AfDB.org/) board in Abidjan on Thursday. The Bank’s support for the Mombasa-Lunga Lunga/Horohoro and Tanga-Pangani-Bagamoyo roads Phase I, is in the form of African Development Bank and African Development Fund loans and represents 78.5% of the total €399.7 million project cost. The European Union contributed a grant of €30 million, 7.7% of the total project cost, to the government of Kenya. The road is a key component of the East African transport corridors network, connecting Kenya and Tanzania. Producers, manufacturers and traders will be able to move goods more quickly and cheaply. In addition, farmers and fishermen will benefit from improved access to local and regional markets and amenities, including better schools and health centres. “The project will have spillover benefits for hinterland countries such as the Democratic Republic of the Congo, Burundi, Rwanda, Uganda and South Sudan that depend on Mombasa as gateway to global markets,” said Hussein Iman, the Bank’s Regional Sector Manager for infrastructure, private sector, and industrialization. The Bank’s support will also provide roadside trading facilitates for sellers, half of them women who currently operate in disorganized and unsafe conditions. The road crosses regions with high rates of youth unemployment. In light of this, the project includes a vocational training component for 500 unemployed youth (half of them women) to acquire marketable skill and improve their economic prospects. The Bank...

Doris Akol denied that URA was seeking to introduce more taxes to raise domestic revenue. Tax incentives on foreign direct investment are denying Uganda up to 70% of potential corporate tax revenue, the Uganda Revenue Authority’s Commissioner General, Doris Akol has disclosed Speaking at a public dialogue on national development in Kampala, Akol said such policy contradicts the country’s plan to expand local revenue to fund the national budget. She said the commitment by government to increase the tax base was undermined by policy contradictions and a pervasive corporate culture of under-declaration of sales. Akol cited the central bank’s indifference to cryptocurrencies, even when many Ugandans were already transacting using the digital currencies. “Some goods are coming through our customs that have been purchased using loyalty points or air miles and we clear them. But there is no policy on cryptocurrencies,” she stated. Ramadhan Ggobi, a board member of the Uganda Development Corporation said the private sector in Uganda was concerned about increasing taxes and borrowing levels. Ggobi argued that attempts to increase the country’s tax base were being directed at the same tax payers, creating a burden on a small group instead of casting the net wider. “Government needs to reduce the appetite for direct taxes and rely more on indirect taxes and improve tax administration,” he advised. Akol denied that URA was seeking to introduce more taxes to raise domestic revenue and part of the answer lies in the huge informal sector which accounts for 60% to 70%...

Giving a speech to mark the 56th anniversary of Kenya’s independence, Minister for Foreign Affairs and East African Cooperation, Prof Palamagamba Kabudi said Tanzania and Kenya are like brothers and will continue to cooperate to see economic diplomacy is strengthened at all times. “We – Tanzania and Kenya are blood brothers hence we wish you well in bringing development to Kenya. But you must also know that Kenya’s development means Tanzania’s development,” Prof Kabudi said, noting that developments recorded in the two countries will also benefit neighbouring Uganda, Burundi, Rwanda, South Sudan, the broader East African Community (EAC). In return, High Commissioner Dan Kazungu commended Tanzanian authorities for the unity and solidarity it has shown to Kenya which has been a stimulus for the development of the two countries. He said: “I would like to say that the unity and solidarity has spurred development among the two countries. We must remember that unity is strength and our goal is to cooperate between us and with all the nations in the world.” Kazungu stated that Tanzania will continue to be special to Kenya due to the solidarity it has been showing to Kenya socially, politically and economically. “It is remembered that in April this year when the two Heads of State met in Arusha we succeeded to remove 25 trade obstacles out of 37, and this proves how Tanzania and Kenya are brotherly nations who are bent on strengthening trade between them,” he elaborated. Kenya accounted for 15 of the non-tariff...

THE German development agency - GIZ is supporting the East African Community (EAC) in two new programmes on regional economic and social integration. EAC Secretariat and the EAC GIZ programme signed an implementation agreement worth 16 million U S dollars for continuing support for EAC regional integration through their support to East African Market Driven and People Centred Integration East Africa (SEAMPEC) and Pandemic Preparedness programs. GIZ Country Director for Tanzania and EAC, Dr Mike Falke, said that through the targeted work in sectors including agro-processing, pharmaceuticals as well as services sectors such as tourism and ICT, SEAMPEC aims to facilitate the improvement of framework conditions to help create more competitive industries and cross border opportunities. “GIZ and the Secretariat have been developing and managing key projects working with partners across the EAC region with a focus on making the Common Market, Customs Union and integration a reality." The programs are managed through the EAC-GIZ partnership to continue grow regional economic and social integration that already has a significant impact in the region. The SEAMPEC program, through its multiple cross-cutting initiatives, takes a holistic approach to regional integration that encompasses civil society as well as the public and private sectors. “Through the SEAMPEC program many businesses and civil society organizations have all benefited from collaborating on the ground and high-level networking and coalition activities. We are proud to continue implement programs that are showing real results and bringing tangible benefits to the citizens of the EAC,” said Dr Falke. Another...

Rwanda and Tanzania individually signed two mega-infrastructure deals in the last week in moves that will undoubtedly reshape the East African region politically and economically. Kenya stands to lose most. Tanzania signed an agreement to link its new railway line to Burundi and the DRC, while a similar deal with Rwanda is said to be in its final stages. The transport ministers of the three countries signed the deal in Kigoma, Tanzania, on 3 December. Three-way funding The first phase of the joint deal will start in Kigoma and end in Gitega, the capital of Burundi, 240km away. It will then be extended into eastern DRC. Each country will have to get funding for its own section, Tanzania’s transport minister, Isack Kamwelwe, said at the signing ceremony. The first phase of Tanzania’s Standard Gauge Railway (SRG), covering 202km from Dar es Salaam to Morogoro, is almost complete. The second phase will connect Morogoro to the administrative capital of Dodoma, even as the East African country also revamps its old metre-gauge railway to enhance connectivity. When complete, the new railway line will cover 1,457km, connecting Dar and the Lake Victoria port city of Mwanza. In May 2018, Rwanda and Tanzania agreed to redesign their joint railway plan, which will start at the Isaka dry port and end in Kigali, to use electric powered trains. In late November, Tanzania’s President John Magufuli said that the two countries are in the final phases of negotiating a deal to build the railway line. The Isaka-Kigali line...

The Horn of Africa coast is strategically important because it is on the Bab al Mandab Strait and Indian Ocean coast where nearly 20 percent of the world trade and maritime shipping pass through. Thanks to their sea port developments, it is set to be the gateway and the link that connects the sub-Saharan Africa to this international trade route, Suez Canal and the Arabian Peninsula on the opposite side of the Red Sea. The mercantile shipping vessels plying along the Bab el Mandeb can now drop their transit consignments at any of the Red Sea or Horn of Africa ports. Similarly, export goods from sub-Saharan Africa and their imports from the rest of the world can easily be picked or delivered from these ports and hauled across to central and West Coast of Africa by existing railways or roads. Recently, the significance of the Horn of Africa and its sea ports was boosted by the discoveries of oil, gas and other extractive minerals in the sub-Saharan Africa countries. Huge exploitations of the same are now in progress in Eritrea, Ethiopia, South Sudan, Chad, Sudan, Uganda, Rwanda, Somalia, DR Congo and Kenya; among others. Additionally, the coastal Horn of Africa countries are experiencing a relative peace renaissance that has enabled development of their Ports and Roads developments not realised in the last 50 years. Hitherto, these countries were ravaged by civil and territorial wars, military rules and instabilities that hindered their endeavour to address their national development challenges. This peace...

The East African Community (EAC) secretariat has mobilised almost $1bn to finance infrastructure projects in the region. While regional governments present these development schemes as a result of their own mobilisation, ChimpReports understands the better part of sourcing for funds is done by the EAC secretariat. Infrastructure is considered one of the most critical enablers of a successful regional integration, taking into account its importance in facilitating activities such as trade, agriculture, tourism and the movement of labour and other resources. According to a report recently submitted to East Africa Legislative Assembly by the Secretariat, the Africa Development Bank (AfDB) Board has approved financing for several projects in Uganda, Rwanda, Burundi, South Sudan, Kenya and Tanzania. The bank, through EAC, approved $349m for the construction of the multinational Nyakanazi – Kasulu – Manyovu road in Tanzania (301 km) and Rumonge – Rutunga – Bujumbura road in Burundi (78 km). Through the NEPAD-IPPF Special Fund, AfDB has provided a grant to the EAC for the feasibility study of the multinational Masaka – Mutukula road in Uganda (89 km) and the Mutukula – Kyaka (30km) / Bugene – Kasulo road in Tanzania (124 km). Still in Uganda, AfDB, through EAC, approved USD229m to finance part of the cost of Kampala-Jinja Expressway on the Northern Corridor, with the rest being mobilized through a PPP arrangement. This road is expected to reduce the traffic congestion along Jinja highway to the border with Kenya, a major transit point for imports and exports. Currently, the Isaka-Kigali...

THE East African Community (EAC) Council of Ministers has been tasked to furnish the East African Legislative Assembly (EALA) with comprehensive reports on regular basis about implementation of pillars of integration. Specifically, the ministers are supposed to inform the august House on each partner state’s status in relation to progress in execution of the Customs Union Protocol and the Common Market Protocol. The resolution was moved by Dr Abdullah Hasnuu Makame (Tanzania Constituency) and adopted by the House. It further wants the Council of Ministers to direct all partner states to fully implement the Customs U nion Protocol by June 2020 and the Common Market Protocol, a year later. The House further urges the Secretary General, (Ambassador Liberat Mfumukeko) to furnish the House with comprehensive reports on the implementation of the Food Security Action Plan, the Climate Change Policy and the Industrialisation Policy and Strategy. The Council of Ministers is also encouraged to develop Comprehensive Monitoring, Evaluation and Reporting frameworks that would track implementation of major actions to be taken and adopted by the Summit of EAC Heads of State and other organs. According to Dr Makame, it is only the Customs Union Protocol that has a stipulated Treaty Timeframe under Article 75(7 ), with the Treaty documenting a period of four years in which to conclude it. He informed the House that, Article 7 7 of the Treaty forecast on the establishment of a Common Market through a Protocol that would be concluded without prescribing a timeframe to achieve...

The second meeting of the Ad-Hoc commiittee of Ugandan and Rwandan officials set up to implement the Luanda Memorandum of Understanding (MoU) that is aimed at resolving ongoing disputes between the two countries will take place in Kampala on Friday. This follows Rwanda’s dispatching of a team of the country’s officials to Kampala after two postponements of the meeting at Kigali’s request. “Uganda and Rwanda will tomorrow hold a follow-up meeting….to the one held in Kigali in September to concretize in the MOU signed in Luanda, Angola in August 2019,” Uganda Government Spokesperson Ofwono Opondo on Thursday tweeted of the meeting to take place at Speke Resort Munyonyo. In February this year, Rwanda closed its main border with Uganda at Katuna and blocked cargo from crossing into its territory causing a customs crisis. Since then, there have been accusations and counter accusations between Kampala and Kigali mostly relating to security. In the  Luanda MoU, the two Heads of State of Uganda and Rwanda undertook to respect the sovereignty of each other and of the neighboring countries. They also undertook to refrain from actions conducive to destabilization or subversion in the territory of the other party and neighboring countries thereby “eliminating all factors that may create such perception as well as that of acts such as the financing, training and infiltration of destabilizing forces.” The two Principals also agreed to protect and respect the rights and freedoms of the nationals of the other party residing or transiting in their national territories...

Trade between the East African Community partner states is projected to grow by between five to eight per cent annually if countries fully implement joint policies and regulations, exploit individual competitive edge and eliminate non-trade barriers. Speaking at the bloc’s 20th anniversary, Nicholas Nesbitt, the chairman of the East African Business Council said East Africans, especially private sector players, now need to reflect on how far they have lived up to the ethos of regional integration. EAC is one of the continent’s fastest-growing regional blocs, registering an economic growth of 5.7 per cent in 2018. “The private sector should be a key partner in the integration process, providing the agenda for economic and social integration but most important, the region should look to becoming a single trading bloc,” said Mr Nesbitt, adding that both the partner states and private sector should expedite the domestication and implementation of harmonised policies. He commended the progress made so far in the improved movement of goods and people because, “starting with the informal sector, it is now easier to access cross border markets; work permit restrictions have been relaxed and professionals and companies are able to expand and establish their customer base.” However, he said intra-EAC trade volumes have not reached desired levels, at just 12 per cent, yet it has the potential to grow at between five and 10 per cent annually. Source: The East African