Ugandans exporting goods to South Sudan are losing billions of shillings in taxes due to a failure by regional countries to ratify the Double Taxation Agreement (DTA). The agreement is expected to lower taxes and increase cross-border investments. Speaking at a press conference held at the Morocco Consulate in Kololo, Hon. Dr. Abraham Maliet Mamer, Secretary General, South Sudan Investment Authority, who came to Uganda for the two-day West Nile Investment Symposium 2019 said that ratifying the agreement could save companies millions of dollars in tax and additionally provide greater incentives for cross-border investments. He said that for investors, being taxed in two jurisdictions — their home country (Uganda) and the country in which a fund ultimately invests (South Sudan) — it is a big turn-off. “It is our expectation that implementation of this agreement will increase cross-border businesses and investment — which, in the long run, will even increase employment as well as domestic revenue,” said Dr. Maliet Mamer. He said that South Sudan government seeks to negotiate tax treaties with Uganda which is a major trading partner to avoid cross-border investors being taxed twice on their income and to maximise investment between them. “Because of the relationship we have [Uganda and south Sudan]; there are no reasons why our people are paying double taxes. In the final of all of these, the burden is passed on to consumers,” he said adding that “we need to look into it.” He said the businessmen should be taxed once “and then...

A raft of measures that the taxman, the Uganda Revenue Authority (URA) has undertaken to raise domestic revenue as a percentage of GDP over the years continues to bear sweet fruits, elevating the country’s tax to GDP ratio. Whereas URA was charged with collecting a net revenue target of sh16.4 trillion, the financial year closed with sh16.6 trillion generated, registering a growth rate of 14.95% or, in real terms, an addition of sh2.16 trillion to the treasury in comparison to the 2017/18, according to Doris Akol, the URA Commissioner General. “The performance was 101.58% which, in real terms, meant a surplus of sh258.8b above the target and the highest target that URA has registered over its 28-year period” she told reporters at the annual press briefing recently. UGANDA AND EAC Uganda’s average net revenue collections growth over the past 5-year period was at 15.72%. “The tax to GDP ratio has increased from 12.84% in the 2014/15 to 15.11% in the 2018/19 above the National Development Plan (NDP 2) target of 14.90%,” says Akol. This growth elevated Uganda’s tax to GDP ratio, with URA currently 3rd in the EAC bloc. In the 2018/19, we recorded a tax to GDP ratio of 15.1%. Kenya, at 16.5% generates more revenue domestically, followed by Rwanda (15.2%), Uganda (15.1%), Tanzania (13.2%) and Burundi (13.4%), says Akol. “By the end of this 2019/20FY, we expect to be at 16% but you can’t compare us too much with others because their economies are not the same as...

The government has now turned to the African Union (AU) as it seeks investors and regional support for the Sh2.5 trillion Lamu Port-Southern Sudan-Ethiopia Transport Corridor (Lapsset) project. Launched in 2012 during former President Mwai Kibaki's regime, the mega project has been marred with cash constraints and lack of political good-will which has slowed down its implementation. Ethiopia is seen to have shifted focus to the port of Djibouti. Road and rail infrastructure between the two countries including the Ethio-Djibouti railway passenger and freight system, which commenced on January 1, 2018, seem to have also shifted interest away from the Lapsset corridor. It has now emerged the AU High Representative on Infrastructure Development Raila Odinga is keen to rally for support of the project. According to the Lapsset Corridor Development Authority,  a strong case has been made to the AU on the Lapsset project’s strategic position to connect not only Ethiopia and South Sudan, but also connecting to Central African Republic (Bangui) and Cameroon, terminating at Port of Douala. “AU’s special envoy plans to convene a high level meeting with the countries that fall along Africa’s equatorial land bridge later in the year with an aim of forming these crucial transport infrastructure linkages within the continent,” the authority said in a statement last week. This was after a meeting with Odinga to discuss ways of strengthening support for Lapsset projects from AU and other international development institutions. The AU special envoy has since noted that Lapsset corridor project has the potential to boost Africa’s regional social-economic integration through...

The Government is banking on increased regional oil trade to change the fortunes of the revamped Kisumu port.Transport Cabinet Secretary James Macharia said on Tuesday that the growing demand for oil products in the region is expected give impetus to efforts at reviving the revamped port ahead of its opening tomorrow.President Uhuru Kenyatta and his Ugandan counterpart Yoweri Museveni, Tanzania’s Pombe Magufuli and Felix Tshisekedi of the Democratic Republic of Congo are expected to open the port upgraded at a cost of Sh3 billion.Macharia said as a long-term solution, the State is still considering an extension of the Standard Gauge Railway (SGR) from Naivasha or revival of the old metre-gauge railway if the latter plan takes too long. The option of connecting the SGR to old Naivasha-Malaba metre gauge, he said, was just an interim measure."We had to look at the economics, but if the SGR (connection) takes too long, the Nakuru-Kisumu line remains an option we can turn to because Kisumu is part of the Northern Corridor,” said the CS in an interview.He said the move by Uganda to build a similar jetty as the one by the Kenya Pipeline Company in Kisumu was key in reigniting the triangular trade between Kisumu, Jinja and Mwanza."Kenya Pipeline Company has improved its throughput to the Kisumu depot with the recent launch of a nine six-inch pipeline and a lot of this will be going into the region though lake vessels. We are looking at liquid products to keep the port busy...

The Minister of Trade, Industry and Cooperatives, Hon Amelia Kyambadde is expected to make a strong case for the African Continental Free Trade Area (AfCFTA) at the second Regional Logistics Expo 2019 (RLE2019), to be held next week on August 21st and 22nd, 2019 at the Sheraton Kampala Hotel. The operational phase of the AfCFTA was launched at the Niger Summit of the African Union, last month, with the free trade area expected to tear down borders and ensure full continental integration. AfCFTA is also expected to drive growth and innovation for Africa, and to create opportunities for sustainable development and realizing Agenda 2063. The AfCFTA will be one of the largest free trade areas since the formation of the World Trade Organisation, given Africa’s current population of 1.2 billion people, which is expected to grow to 2.5 billion by 2050. The Trade Ministry has been rallying Ugandan businesses to be ready to exploit the opportunities that will arise with the continental agreement, with Hon Kyambadde at the forefront. “She is very passionate about AfCFTA,” Mr Julius Kasirye, the Senior Commercial Officer at the Trade Ministry, said. “When she begins speaking about AfCFTA, she convinces you that anything is possible,” Mrs Merian Sebunya, the chairperson of the National Logistics Platform, one of the partners of the RLE2019, added. Both were speaking recently during an Expo preparatory meeting held at the Ministry of Works and Transport (MoWT) offices. The Uganda Freight and Forwarders Association (UFFA) is hosting the Expo, in partnership...

Rwanda’s tea is selling at premium rates at the Mombasa Tea Auction, overshadowing price offers on Kenyan produce as international buyers focus on quality. Weekly price offers for Rwandan teas have been on the rise in the last three months, outshining produce from Kenya Tea Development Agency (KTDA) outlets. This week, broken pekoe-1 (BP1) tea from Gisovu factory — Rwanda’s top outlet — attracted a highest bid of Sh550 per kilo compared to Sh428 per kilo offer that the same grade from Meru-based Githongo factory (Kenya’s best) attracted. Traditionally, Kenya tea has attracted top prices. “Since the grade of tea is the same across the region, that implies quality is what is creating the price difference,” said Mr William Tindi, an executive at the African Tea Brokers. “Buyers may bid high or low depending on quality.” The regional teas are offered for sale at the Mombasa auction by the East African Tea Traders Association before they are shipped out of the country. Kenya, a leading tea exporter in the world, accounts for three quarter of the produce traded at the Mombasa auction. While prices have generally remained low at the auction in the recent months on the back of high volumes, Kenya’s tea is apparently shedding its attractiveness even as factories in Rwanda work to improve the quality for export market. While the produce from the two states, which were almost at par through the April auctions, only one of the KTDA’s 65 processing factories was able to cross the...

Despite having the fastest growing population in the world, more than 95 per cent of world trade takes place outside Africa. Doing business here is very costly and African exports to global markets face challenges that are yet to be addressed. Just recently, the UK Foreign Secretary Dominic Raab went to Thailand to meet with the ten nations of the ASEAN trading bloc in an effort to establish good trading relationships outside of Europe, ahead of Brexit.We need to be thinking in the same way - not to avoid trade with Europe, of course, but to really consider how trade relations will make or break Kenya’s prosperity.The main challenges facing smooth and mutually beneficial trade transactions in Africa are globalisation, supply chains, block chains, and the flow of data. These are new concepts to the entire world, but in Africa, we must jump through an extra level to overcome them. We are still dealing with a lot of corruption and lack of coordination between African states, as well as poverty and unskilled labour markets.However, these shortcomings of the market can be addressed through economic diplomacy. The idea is that economic diplomacy - linking trade with foreign relations - can be used by developing nations as a means to push fast economic development. Foreign policy is bolstered by financial relations. This brings to mind the recent conference on ‘the Future of Economic Diplomacy held in Victoria Falls in Zambia. Notably, President Uhuru Kenyatta, at the invitation of the President Edgar Chagwa...

The Integrated Customs Management System (iCMS) Sea cargo regime has gone live at the Port of Mombasa with the clearing of the first consignment of 43,400.835 metric tonnes of clinker. The Vessel transporting the consignment, MV Ptolomeos, docked at the Port of Mombasa at 6.25 a.m. on Saturday, 3rd August 2019 and was offloaded to its destination. The consignment was cleared automatically in the Integrated Customs Management System, after the importer’s clearing agent, Express Shipping and Logistics (ESL), lodged entries in the system and paid duty of Ksh65 million before the arrival of the cargo. The next bulk consignments to be cleared through iCMS are 42,000 metric tonnes of clinker and 25,540 metric tonnes of coal. The former arrived at the Port of Mombasa on 7th August onboard MV Boreas Venture and the latter is expected to arrive on 21st August by MV African Hoeg respectively. The clinker consignment which is still in high seas was cleared pre-arrival following the lodging of entry and payment of duty of Ksh. 62,657,000. The coal importer, Riftcot Limited, has initiated the cargo clearance process by registering an import declaration form (IDF) to have the cargo released through the system. KRA expects to collect revenue of more than Ksh. 40 million from the consignment. The clearance of cargo through the Integrated Customs Management System is a major milestone for efforts by KRA to expedite customs clearance of cargo and enhance trade facilitation. iCMS will reduce the cargo dwell time for compliant imports at the Port of Mombasa since the system does not require...

The 3rd Trade and Business Facilitation Symposium organized by the Consulate of Uganda in Mombasa commenced on Monday 12, at the Pride Inn Hotel in Mombasa. The Symposium is taking place under the theme: Enhancing Trade Facilitation along the Northern Corridor’. Key on the agenda is in depth discussions on how to increase the level of trade between the two countries and how best to utilize the Northern Corridor. In attendance is Hon. Amelia Anne Kyambadde Minister of Trade, Industry and Cooperatives, Hon. Members of Parliament of respective Committees on Trade, Foreign Affairs, Uganda’s Consul General to Mombasa Amb. Tayebwa Katureebe, Amb. Kiema Kilonzo, Kenya’s High Commissioner to Uganda, Amb. Richard Kabonero Uganda’s High Commissioner to Tanzania, Uganda’s Ambassador to UAE Amb. Zaake Kibedi, Uganda’s Consul General to Guangzhou Amb. Solomon Rutega, Uganda’s Charge D’Affaires to Qatar Amb. Simon Ajiku and Amb. Paul Mukumbya Head Regional Peace Department. Others include Mr. Micheal Wamai Head Regional Economic Department Commissioner Dickson Kateshembwa Commissioner Customs and other Senior officials Government of Uganda and Officials from the Republic of Kenya. In her opening remarks, Hon. Amelia noted that the main objective of this symposium is to bring together different stakeholders involved in trade facilitation to discuss and exchange views and provide an opportunity to address existing and emerging the challenges faced in the export and import trade. The Minister further reiterated that Government of Uganda remains committed to the EAC Regional Integration processes and putting in place measures to facilitate trade noting that the...

President Paul Kagame says the African Continental Free Trade Area (AfCFTA) should ease free movement of people as it will for goods because goods cannot move on their own if people cannot move freely. President Kagame made the observation on Friday at the inaugural Private Sector Federation (PSF) Golden Business Forum which brought together over 600 members of the business community from Rwanda and 22 other countries under the theme “Unlocking Intra-Africa Trade”. The Head of State said the pace of regional and continental integration has accelerated significantly in recent years, citing the AfCFTA under which African countries will begin trading in July 2020 as one of the key milestones of integration on the continent, adding that they should ease free movement. “The Protocol on the Free Movement of People has been signed, and the ratification process is underway. Once in effect, Africans will no longer require visas to travel within Africa, among other valuable rights,” “How are we going to allow free movement of goods but you don’t allow free movement of people?” President Kagame wondered. He noted that African countries have to understand that even with most restrictions on movement of people and visas, people have been moving. “They move across borders whether you give them visas or not. Some of these people are brothers and sisters, only that they live on opposite side of what is known as the border,” “It is up to us the leaders to really make it easy for all of us because...