Five months after the East African Community deferred signing the controversial Economic Partnership Agreement with the European Union, it has emerged that Tanzania’s unyielding stance could force a stay of the status quo as the EU is hesitant to push the region to sign a trade deal that threatens its cohesion as a bloc. Well-placed sources at the European Commission told The EastAfrican that the EAC negotiated and concluded a bilateral trade agreement with the EU as a bloc, and it must remain as such. “All EAC members need to sign and ratify the agreement,” said the EC sources. The EPA gives EAC products total access to the EU market, with 82.6 per cent of imports from the EU allowed into the EAC market. The remaining 17.4 per cent of imports from the bloc — labelled “sensitive,” and largely consisting of farm and dairy products — would be progressively liberalised within 15 years from when the agreement comes into force. Kenya and Rwanda have signed the deal. However, Tanzania is unhappy about the trade pact, arguing that the agreement will have serious consequences for its revenues and the growth of its industries. Burundi refused to sign given its deteriorating relations with Europe. Uganda argued that signing the pact as individual countries would compromise the unity of the region, hence its decision to wait it out. Kenya has been lobbying its EAC partners to enforce the EPA on an individual basis rather than as a bloc to allow those that have not signed...

Efficiency in tax collection, improvement in service delivery and voluntary compliance are some of key factors Rwanda Revenue Authority (RRA) says contributed to the tax body surpassing revenue targets for the fiscal year 2018/2019. This was said by the RRA Commissioner General Pascal Ruganintwari Bizimana on Friday while announcing Revenue Performance Results for Fiscal Year 2018/2019. RRA collected Rwf1421.7 billion compared to the targeted Rwf1392.1 billion. The increment represents an achievement of 102.1 per cent translating to Rwf29.6 billion in excess of what the tax body had set as the target. Of the collected amount, tax revenue collections for 2018/19 amounted to Rwf1398.8 billion compared to the targeted Rwf1373.1 billion, equivalent to an increase of 101.9 percent. RRA collected Rwf25.7 billion above the target. According to the figures released by the tax body, there was a significant increase in the tax collections compared to Rwf1234.1 billion generated in the fiscal year 2016/17. The Rwf164.7 billion in excess this financial year compared to the previous one, reflects a 13.3 percent growth. “Though we have experienced some political setbacks in the East African Community, trade was not affected because the borders have been open. We also noticed an increase in import trade where members of the business community increasingly bought goods from other countries like China,” Ruganintwari said. He said the situation between Rwanda and Uganda has not affected tax collections since most goods from the region are exempted from tax. “We can attribute the increase in tax collection to improved service...

The Chairman of the Private Sector Federation (PSF), Robert Bapfakurera has revealed that the new good relationship between Rwanda and the Democratic Republic of Congo (DRC) has presented ample trade opportunities among Rwanda’s private investors. During an exclusive interview with IGIHE, Bapfakurera highlighted that food commodities are most likely to get the biggest market in DRC because the later imports more. Trade opportunities between Rwanda, DRC have been recently boosted by the launch of RwandAir flights from Kigali to Kinshasa, the capital city of DRC while cargo flights are also expected to follow. Bapfakurera has said that Rwandan traders welcomed both countries’ efforts to improve relations and demonstrated willingness to expand businesses in DRC. “They have started visiting DRC to analyze the market and identify partners so that they can run businesses next time. They were extremely delighted,” he said. Rwanda has the largest export market of foods and other commodities in DRC particularly in Eastern part of the country namely Goma and Bukavu which Bapfakurera said is set to get a boost. Bapfakurera explained that the launch of cargo flights will be a great trade opportunity with DRC because investors would often use passengers’ aircrafts to carry luggage which would run short of space. Rwanda, DRC relations started getting a boost when President Félix Tshisekedi was elected at the beginning of 2019. President Paul Kagame has recently revealed that RwandAir was denied route to Kinshasa to DRC at the reign of former President Joseph Kabila. Source: Igihe

MPs on Thursday told Prime Minister Edouard Ngirente that the government needs to increase efforts to boost both internal and external trade for the country. As the Premier addressed a joint session of senators and deputies about the government’s activities in the trade sector, they urged him to push for more assistance to industrialists and farmers’ cooperative in order to produce more and better goods for markets. With Rwanda’s trade deficit slowly decreasing, especially since the government initiated a Made-in-Rwanda Campaign in 2018, the legislators said that the country needs to keep efforts at developing agro-processing industries. Thanks to a vibrant agriculture sector, Rwanda reported a $105-million trade surplus in the area of informal cross border trade in 2018 as it traded mostly agricultural goods, mainly with neighbouring countries. “Most of the exports were agricultural produce,” the premier said on the recorded cross-border trade surplus. The report on cross-border trade and other opportunities in agribusiness had many MPs pitching ideas that a bigger attention should be put on agriculture. MP Jean-Pierre Hindura said that more investments need to be made in the agriculture sector, at one point suggesting that a special ministry is needed to take care of animal resources development. “We need to invest more in agriculture. Why can’t we have a special ministry in charge of animal resources or just a State Minister in charge of livestock?” he wondered. He added: “Agriculture is a key sector that is even essential for fuelling industry”. Hindura said that “cross-border trade...

Kenya plans to focus on the African continent to drive export growth, an official said on Thursday. Jaswinder Bedi, chairman of Export Promotion Council (EPC), told journalists in Nairobi that Kenya has a competitive advantage in manufactured goods as compared to most other African countries. “We see an opportunity to expand our export volumes by focusing on sale of manufactured goods to the rest of Africa,” Bedi said. Government data indicates that in 2018 approximately 40 percent of Kenya’s exports went to other African markets. “Most of Kenyan exports to Africa are value-added goods while exports to the rest of the world are mostly raw materials,” Bedi said. Kenya is likely to reap enormous benefits once the African Continental Free Trade Area (AfCFTA) is fully operational and tariffs are removed, he said. “At present non-tariff barriers in the form of product standards present a huge challenge to the expansion of Kenya’s outbound trade in Africa,” Bedi said. According to the EPC, poor transport infrastructure also hinders the growth of Kenyan exports to the rest of Africa. “Merchandise from Kenya often becomes noncompetitive when transported to landlocked countries in the continent,” Bedi said. Kenya’s export now accounts for 8 percent of its gross domestic product (GDP), against a target of 15 percent. The majority of Kenyan exports are agricultural products with little value addition, Bedi said. Source: County Dispatch

Each of the nearly 40 general insurance underwriters and members of the Association of Kenya Insurers (AKI) agreed during a consultative meeting held on Wednesday at the head office in Nairobi, to work with the Kenya TradeNet Single Window information processing system to relay all the marine cargo insurance and customs bonds to importers and the Kenya Revenue Authority respectively. Speaking after the meeting, AKI Executive Director/CEO Tom Gichuhi explained that the resolution was important for all the insurers to enhance efficiency and transparency of importation information processing, a major cog in the international trade wheel. “During the AKI General Insurance CEO’s forum, member underwriters unanimously agreed that effective immediately, customs bonds shall solely be processed through the KenTrade – National Electronic Single Window System portal in line with government policy,” said Gichuhi. Headed that the marine cargo insurance will continue to be processed through the Kenya TradeNet System online portal provided by Kentrade and connected to the Kenya Revenue Authority-driven online system. The KenTrade portals provide integration between Kenya Revenue Authority, the insurers and all stakeholders in the import, export value chain The AKI CEO said that the two portals were an important part of the marine cargo and customs bonds management and it was crucial for them to deliver a high, consistent rate of efficiency, cost transparency and effectiveness for Kenyan importers. This is on the back of enhanced legislation that has over the years consolidated information management processes for importers and reduced the cost of doing business....

Negotiations to restart development of deep water port ‘ongoing’, Mbelwa Kairuki says. Project was halted last month by African nation’s president over problems with terms of deal. Discussions are ongoing to get the China-backed US$10 billion Bagamoyo Port project in Tanzania, which was “suspended indefinitely” by the east African nation’s president because of disagreements over the terms, back on track, its ambassador to Beijing said on Thursday. The troubled project was “not off the table” and the remaining issues could be sorted after consultations between the Tanzanian government and investor China Merchants Port Holdings, Mbelwa Kairuki told reporters during a visit to Hong Kong. Of the 29 issues still to be resolved, four might require parliamentary action such as formulating a legal mechanism for the operation of the special economic zone alongside the port he said. “The Bagamoyo project is, there’s a negotiation, which is ongoing between the government and the investor,” Kairuki said. “Some of the issues that the investor is proposing don’t make sense, but we hope that through engagement … we will get to understand better. “The good thing is the investor is ready to engage, and the government is willing to as well.” The envoy’s remarks came after Tanzanian President John Magufuli last month rejected the conditions of the deal for the project, which is being developed under China’s Belt and Road Initiative and is intended to be Africa’s largest deep water port. Magufuli described the terms which include long tax breaks for investors in the...

With 54 out of 55 African Union member states having signed the Africa Continental Free Trade Agreement (AfCFTA), the continent is on the verge of becoming the world’s largest free trade area which will merge the massive area into a single market of 1.2 billion people with a combined GDP of US$2.5 trillion (over N$35 trillion), according to the UN Economic Commission for Africa. However, local analysts have cautioned that the ambitious initiative is being hampered by issues such as non-tariff barriers, lack of financing and infrastructure problems. It has been estimated that that the Africa needs at least US$300 billion (approximately N$4,2 trillion) by 2020 to build quality infrastructure to facilitate the free trade agreement. “For continental trade to increase, substantial investment in infrastructure is required, not only in transport infrastructure, but in border infrastructure, in communication technologies so that business people can communicate easily across the continent, in financial infrastructure so that money can flow easily, in electricity infrastructure so that border posts can operate effectively 24 hours a day, etc. In addition, customs and other documentation should be unified to ease cross-border trade, as well as transport regulations such as axle loads, working hours of truck drivers etc,” commented Klaus Schade, a local economic analyst. Responding to questions from New Era, Schade added that trade across borders requires movement of people across borders, such as business persons, traders, truck drivers and so forth. “Namibia has taken the first step and embarked on visa on arrival, although the...

The success of the African Continental Free Trade Area (AfCFTA) will be measured largely by its ability to change lives, reduce poverty and contribute to economic development in Africa. This is according to the ninth edition of the flagship Assessing Regional Integration in Africa report (ARIA IX) launched during the African Business Forum. Expounding on the report, United Nations Conference on Trade and Development Secretary General Mukhisa Kituyi said that competition, investment and intellectual property rights are crucial requirements in the next phase of the agreement. He also urged the African business community to take ownership of the integration effort on the continent. The report highlights challenges facing regional integration which include limited energy and infrastructure development, insecurity and conflicts and limited financial resources among others. Going forward, the report says e-commerce is likely to be a significant driver and outcome of intra-African trade. “The public and private sectors are increasingly adopting e-commerce platforms. Governments deliver services through them, electronic marketplaces aggregate consumer and producer demand as well as trade-related services, traditional businesses have incorporated e-commerce into their business models and operations and individual entrepreneurs and small businesses use social media platforms to engage with market opportunities,” reads the report. Source: Capital Business

Rwanda parliament has ratified the 2015 Tripartite Free Trade Area (TFTA) agreement, a market of three regional blocs. TFTA brings together country members of the Common Market for Eastern and Southern Africa (COMESA), East Africa Community (EAC) and the Southern African Development Community. The ratification was passed this Wednesday without going through the commission scrutiny but came with debate on its importance, fears of duplication of the recently launched African Continental Free Trade Area (AfCFTA) worth $3.4 trillion. TFTA consists of a US$1.2 trillion free trade area, incorporating 26 African nations, with a population of 632 million people. The overall aim of the TFTA is to remove barriers to trade and to ease the movement of people between its signatory nations. Minister of Trade and Industry, Soraya Hakuziyaremye who presented the bill said “This agreement is very important to our export market since it introduces our country to a much wider market as it includes the Southern Africa Development Community of which we are not member.” At first, some members of parliament were hesitant to endorse it on ground that the agreement may be just a duplication of the already existing AfCFTA. “I sense an issue of duplication here. We should be sure that we would not loose taxes to these agreements,” MP Frank Habineza said. For MP Ignacienne Nyirarukundo, the AfCFTA was enough. MP Christine Muhongayire backed the idea of her colleagues but advised that parliament takes its time to assess the deal in the commissions. “It’s advisable to...