Uganda will begin refurbishing its century-old Meter gauge rail (MGR) network to boost bulk cargo transportation, after failing to secure US $2.2bn in Chinese funding for a new Standard gauge railway (SGR). Meter gauge railway (MGR) revamp The Managing Director of the state-run Uganda Railway Corporation (URC), Charles Kateeba said that the rehabilitation will be carried out in phases over several years and cost at least US$308 million. French firm Sogea-Satom will undertake the works, which include installing rocks ballast on sections, re-laying of tracks, flattening sections and repairing about 500 freight wagons. The European Union (EU) has given a grant of US $27.5m and the railway corporation is talking to international development lenders for the rest. Former colonial power Britain built the meter-gauge, 1,266km (790 mile) network a century ago, mainly to move copper and other commodities. But the network fell into disrepair during years of political upheaval and economic instability. “Due to lack of maintenance over the years, most of the network is now in disuse,” Kateeba said. “We shall replace some areas which have been either removed by vandals or are badly worn,” he added. Standard gauge railway (SGR) Majority of transporters, especially those dealing with bulk cargo, have been eager for cheaper transport and were disappointed when China did not offer funding for the Ugandan section of the Standard Gauge Railway (SGR) regional project. It was originally designed to connect Kenya’s Indian Ocean seaport of Mombasa to a vast hinterland including Uganda, South Sudan, Rwanda and Burundi. Kenya has developed a...

Intra-regional trade within the East African Community (EAC) bloc rose by 10.3 per cent last year, courtesy of harmonisation of cross-border rules and procedures. “Reforms taken under the Customs Union has also boosted intra-regional trade,” Christophe Bazivamo, EAC deputy secretary general responsible for productive and social sectors, said in Arusha November 11. He said intra-EAC trade catapulted to $3.2 billion last year from $2.7 billion in 2016 and $2.9 billion in 2017. Bazivamo disclosed this at the just concluded second meeting of the EAC Development Partners’ Group (DPG). The meeting held at the EAC headquarters deliberated on key aspects of the economic integration and infrastructure development. Officials at the EAC secretariat officials say there was “no one rule or procedure” introduced but insisted generally most of the trade procedures within the region have been simplified. They cite the operationalisation of the EAC Single Customs Territory (SCT), the Authorised Economic Operator (AEO) and One Stop Border Post (OSBP) and their respective rules and regulations as having a multiplier effect on the ease of doing business in the region. Alongside with these is enhanced customs operations inter-connectivity in the region which has seen the introduction of Electronic Cargo Tracking System to monitor the movement of traded goods across the region. Bazivamo told representatives of development partners that despite a host of challenges like scarcity of resources, the EAC integration process was on course. “A number of achievements have been made in the four pillars of integration which include the Customs Union and...

Arusha. The secretariat of the African Continental Free Trade Area (AfCFTA) will be operationalised in March, next year. The agreement came into force on May 30, this year, after it was ratified by the required 22 African Union (AU) countries. This was revealed here on Monday at the start of a symposium on the trade agreement which attracted scholars and experts from across the continent. The secretariat of the intra-African trade body will be established in Accra, Ghana as appointment of the secretary general is underway. “Structure and budget of the secretariat has been approved”, said Dr. David Luke, the coordinator of the African Trade Policy Centre based in Addis Ababa. He said it has been proposed that AfCFTA establish office in each state party; countries which have signed and ratified the agreement. Source: The Citizen

Lesotho is considering direct trade with Kenya for the tea commodity. Speaking at the Ngorogo Tea Factory, in Kiambu, Minister for Agriculture and Food Security in Lesotho Simon Litsane said they would collaborate with management at Ngorongo tea and the Ministry of Agriculture in Kenya in the tea business. His counterpart in the Ministry of Trade and other senior members of the Kingdom of Lesotho government accompanied Litsane who led the delegation. “Lesotho doesn’t grow tea we are amazed at what you Kenyans are doing, our government is interested in introducing black tea in our market and we are ready to learn more”, he said. CBC will exacerbate economic inequality and burden parents He said they would in the future invite the management at Ngorongo to test their soil if it is viable for tea plantation. Also, he said that the investment would create jobs for the youth. Gorongo Tea Factory General Manager George Mugo said they were excited that Lesotho government would be considering introducing Kenyan tea trade directly from the factory to Lesotho market without any intermediaries. “In collaboration with the Kenya intercontinental free trade market, we have discussed an open trading window where we can export both tea in bulk in value-added form”, He said. The tea will reach Lesotho while very fresh and the country will be able to sell it. Besides, he said Lesotho had the Potential as a new market niche. Kenya is the leading exporter of tea globally. Lesotho relies on tea from...

The IMF on Wednesday revised up its growth forecast for Rwanda this year to 8.5%, from its previous projection of 7.8%, crediting strong growth in the first half of the year and new public and private investments in construction. The small east African nation’s economy grew at more than 10% in the first half of 2019, said the International Monetary Fund’s Laure Redifer, speaking at a news conference at the end of a two-week mission she led. “All the leading indications show a continued growth,” she said. Citing “big construction projects”, increased private borrowing and increased activity in the tourism and transport sectors, she said: “It’s a mix of a lot of things.” Tourism revenues were $380 million in 2018 and the government projects revenues of $405 million this year, the chief economist of Rwanda’s central bank, Thomas Kigabo, said at the news conference. President Paul Kagame, in office since 2000, has won international praise for overseeing a peaceful and rapid economic recovery of the country since the 1994 genocide, when an estimated 800,000 people were killed. Critics say this growth has come at the expense of civil liberties.

East African countries are progressively improving their policy frameworks governing trade, but governments need to do more to improve the business environment as a whole, according to the second edition of the African Union Commission’s (AUC) economic report produced in collaboration with the Organisation for Economic Co-operation and Development (OECD) Development Centre. Governments in the region are adopting a series of pro-trade reforms to reduce barriers to trade and improve the overall trade environment. In 2019, at the time of writing, most countries in the region had outperformed the sub-Saharan Africa average for trading across borders, says Africa’s Development Dynamics (AfDD) 2019 report released Tuesday. However, while some countries like Mauritius, Rwanda and Kenya outperform others in the Ease of Doing Business rankings overall, more countries in the region require additional work to improve the overall business climate. “Complex and burdensome business procedures in many countries undermine efforts to promote business linkages, cross-border firm networks and regional value chains,” the report says. It says regional integration is a contentious political process to manage and should be deployed tactfully to promote an environment conducive to transforming the economy’s productive structure. “Regional integration exposes businesses to outside influences, opportunities and competition. This can trigger resistance or hesitation among certain stakeholders that fear economic disruption.” It adds that regional integration initiatives also carry enormous potential for economic and social benefits to ordinary citizens and domestic private sector operators alike. I t says: “A tactful approach with carefully selected initiatives should be deployed as...

The government is mulling a shift from the policy requiring goods to be cleared in the port of origin before being exported into the country. The move could be a relief to small scale traders who have been waiting for days for their goods to be cleared for entry into the country. To achieve this, Trade CS Peter Munya said that there are discussions at advanced levels to merge the standards agencies to create a more proactive verification organisation. The Kenya Copyright Board, Pharmacy and Poisons Board, as well as Kenya Industrial Property Institute (Kippi) among other standards agencies may be affected in the proposed changes. The CS said the proposal is before the Standards Council and it would be approved by the Cabinet in good time to save traders from the long wait. “This will strengthen the institutions to have them work in tandem with further reforms which involve incorporating the ACA in the inspection of goods coming into the country. “These reforms have been in the works for some time. We have concluded the report which we will soon present to Parliament,” the CS added. He further revealed that the government is setting up the Kenya Trade Remedy Agency (Ketra) to deal with goods from outside the country that are not properly priced. The agency will also check for substandard or subsidised goods such as cheap milk and cases of dumping. Munya said this will be a departure from the chaotic situation at the port where multiple agencies...

Despite a steady increase in coffee consumption around the world, trade prices have fallen dramatically in the past three years, hitting producers. At the same time, the cost of an espresso or latte remains as full-fat as ever. What's going on? Futures on arabica and robusta, the most widespread varieties of coffee, have fallen 40 percent since the beginning of 2017 and are now at historically low levels. This is largely because of bumper harvests in Brazil, the world's main coffee producer. But at the same time, consumption has grown by an average of 2.1 percent a year for the past decade, according to the International Coffee Organization (ICO). Two billion cups of coffee are drunk every day, according to Fairtrade International, which works to improve the lot of farmers through better pricing and conditions. The crisis in prices is beginning to create "real structural problems" for producers, said Valeria Rodriguez, a manager at fairtrade organisation Max Havelaar France. "The consequences are terrible - they can no longer support themselves, invest in production or prepare for the challenges of climate change," she said. Supplier woes In Central and South America, many smaller producers in Africa and Latin America are giving up in particular those who grow arabica, which is more difficult to produce than the robusta variety favoured in Asia, according to Jack Scoville, a futures markets analyst with Price Group. A similar trend is observable in Africa for reasons ranging from high production costs in Kenya to insecurity in...

Non-tariff barriers have been cited as the most challenging stumbling block in the East African regional block. Youths doing business in the member states decry the barriers that deny them chance to explore and utilize the available market. This took the greater part of the discussion at the YouLead summit 2019 sitting in Arusha Tanzania. Despite the willingness expressed by member states in the integration process some are still adamant and only look at how they benefit as individual states. During the YouLead summit young entrepreneurs raised a number of issues that frustrate them hindering their participation in regional trade hence keeping their products at local markets. They say the available technology in the new media era gives them chance to reach out to many people outside their home countries but sometimes they find it hard when it comes to physical exportation of goods to their clients. Sylvanus Maritim, Member of Parliament Ainamoi in Kericho County, says despite the good policies that are in place, there is a lot that needs to be harmonized for East African states to get on the same page. Access to finance is another challenge the youth cite that hinders their entrepreneurship needs, despite some governments having youth empowerment programs; the youths are not yet fully into business and the unemployment is still high in the region. Lilian Aber, the Chairperson National Youth Council, says youths who are doing business should put in mind the fact that value addition is one of the most important...

AS the East Africa Community (EAC) marks 20 year since its revival, the private sector has organised a high level business summit, which aims at elevating intra-regional import to 70 percent from the current 13.9 percent. The Chairman of the National focal point- The Tanzania private sector foundation (TPSF) Mr Godfrey Simbeye said on Wednesday that the Summit will be jointly organised by the East African Business council (EABC). “The meeting is scheduled to take place in Arusha from November 28 to 29 this year. We expect 200 business persons from Rwanda and over 500 from Tanzania, other countries are yet to confirm the number of participants,” he noted. He added: “Despite increased investment promotion at national and regional levels in the year 2017, intra regional import stood at 2.8 billion US dollars which is 13.9 percent only. In the year 2018, Foreign Direct Investment fell by 5.1 percent to 6.7 bn US dollars from 7.1 bn US dollar in the year 2017” . Mr Simbeye revealed that for the past twenty years, Intraregional trade was mainly dominated by Agricultural commodities, Pharmaceuticals, soaps and plastics and that the intraregional exports grew to 3.2bn US dollars, which is equivalent to 5.6 percent in the year 2018. He said the summit will discuss best ways of resolving challenges that face business operations in the bloc. “We want to harmonise not only tax issues but also ways of having competitive industries within EAC. Our aim is to make sure countries do not produce...