Over the past three decades regional integration schemes have mushroomed across Africa, Asia, Europe and the Americas. Regional integration promotes global advantage for businesses of the regional bloc members by creating common markets which open up borders and eliminate import/export tariffs. This increases the bloc’s global competiveness by marshalling the individual States’ potentials and presents their case in unison. African countries have been working towards integrating at continental level as well as sub-regions. The quest for the East African region to integrate has seen coming together of six states: Burundi, Kenya, Rwanda, South Sudan, Tanzania and Uganda which arguably is a good move. The East African Community (EAC) integration is anchored on four pillars: Customs Union, Common Market, Monetary Union and Political Federation with significant strides already made on the former three. Imperatively, the Political Federation pillar whereby the region envisages a Superstate with a single government makes EAC integration unique. Successful integration needs a ‘forward-looking’ strategy. The European Union is lauded to be the most successful integration scheme and from which lessons are drawn but the on-going Brexit negotiations have apparently cast a shadow on it. The EU has also been through a number of crises that threatened to tear down the Union. These included: the Eurozone Crisis (2009), the Ukrainian Crisis (2014), and the European Migration Crisis (2015). However, the EU has weathered these storms and forged forward albeit at a slower pace. This can be attributed to the firm political will from EU member States and the...

Johannesburg, Jan 11 (Forbes): One of Africa’s long reigning leaders and President to East African country Rwanda says Africa should start engaging in continental trade and maximising export to the world to reduce African dependency on foreign funding. In a recent interview with Forbes Africa Kagame emphasised the importance of localising production and maximising export to the rest of the world, saying that will encourage African economies to be self dependent  and increasing players in the global economy made in the continent. Paul Kagame is the current Chairman of the African Union preceding the role from former Chad Prime Minister and Diplomat, Moussa Faki Mahamat. Kagame assumed his role in the AU from Jan 2018 and has been championing African Economic Development since. The Rwandan president is best known for his diversity in parliament by having a majority parliamentary cabinet represented by women. His made in Rwanda strategy qualified him as African of the year at the 2018 All Africa Business Leaders Awards (AABLA) which is an annual event that honors business excellence and leaders who have played a significant role in the business industry and communities. Kagame has spent the previous year improving economic climate and conditions in his home country Rwanda. His most important highlights include securing a contract with Alibaba and improving the ease of doing business in Rwanda which was attested by the world bank. Whilst overcoming the milestones of a painful past that has Rwanda stills in scars, where more than 1 million people lost...

You won’t have missed the nationalist mood engulfing big economies around the world: the US, Britain, Brazil, France and Germany are all stained by proto-fascists in and around power. Politicians in these countries talk of taking back control of borders; they are keen to identify those who should and should not receive state support.   But the politicians of Africa are headed in a different direction. Far from erecting walls, they want to build “the world’s largest free trade area since the formation of the World Trade Organisation”, according to Sierra Leone’s trade minister Peter Bayuku Konte. The African Continental Free Trade Area, sporting the catchy acronym AfCFTA is an African market that is 1.2 billion people strong and has a gross domestic product of $2.5trn. Sierra Leone signed up to become a member on 7 November. It is a bold step by the continent’s leaders. A “new chapter in African unity”, according to Rwanda’s President Paul Kagame, the energetic chair of the African Union (AU). He has been remarkably successful in whipping into line so many peers. Experts agree. “This level of diplomatic and political support for regional integration and trade has not been seen in Africa for a long time,” says Trudi Hartzenberg, executive director of the Trade Law Centre, which is based in South Africa. The economics certainly appear to stack up. Tiny fragmented African markets cannot hope to compete for global capital. And Africa’s most successful regional economic bloc, the East African Community, has been attracting great...

However, infrastructure deficit may hinder the progress of building AfCFTA Chinese entrepreneur He Liehui boarded a flight to Ghana and visited Africa for the first time 18 years ago. Now his businesses have landed on more than 20 African countries, after knocking on the door of each market one by one "The process was extremely difficult, due to a lack of understanding of the culture and laws of different African countries," said He, founder and president of the Touchroad International Holdings Group, a multinational business engaging in international trade, cultural exchanges, tourism, and special economic zone construction in Africa. To cite a few examples. His T-shirt business failed in Ghana, he lost large amounts of money when he first entered Nigeria, and he also had other experiences, like escaping from an arsenal explosion and stray bullets. African countries all have different rules and regulations, and each market has its unique features. The experience of doing business in one country could hardly be copied in another, said Tang Xiaoyang, a researcher on Africa studies at Tsinghua University in Beijing. "Having many scattered markets has long been an important factor that makes it difficult for traders and investors to expand their business on the African continent, and hinders the economic development of Africa," he said. However, the grand plan of building the African Continental Free Trade Area will definitely bring great economic momentum to the continent when it is completed. The AfCFTA was first signed in March of 2018 by 44 countries...

Rwandan tea outperformed Kenya’s at the Mombasa auction last year on the account of high quality that saw increased demand from buyers. Data from Tea Directorate indicates a kilogramme of Rwandan tea on average fetched Sh287 against Kenya’s Sh262 last year. The Rwandan price, however, came down from a high of Sh323 that the neighbouring state fetched the previous year while Kenya’s tea also declined from Sh300 to Sh262 in 2018. Rwanda, according to brokers at the auction, produces some of the best teas regionally, which attract a premium price from buyers at the auction. “Rwandan tea normally fetches good price at the auction because of good quality that results from best agronomical practices that they have invested in,” said one of the tea brokers. “To them (Rwanda) quality is more important than the volumes that they bring at the auction,” he added. Over seven countries sell their tea through the weekly Mombasa auction, destined for international market. The auction is managed by the East African Tea Traders Association. Earnings from Kenyan tea exports are projected to rise by Sh5 billion this year resulting from low volumes and high auction price. The Tea Directorate says the volume of the beverage will this year drop from a high of 450 million kilos that realised in 2018 to a low of 435 million. The decline in supply, says the directorate, will see the average auction price surge to Sh280 per kilo up from Sh260 achieved in 2018. Tea prices have been on...

Last year was a dynamic year for Africa in both positive and challenging ways. The Africa Continental Free Trade Area (AfCTA) was effected; Nigeria showed signs of moving out of recession with risks of going back, South Africa dipped into recession and the growing debt burden of African governments was brought into focus. In terms of economic diplomacy, 2018 saw China announce a $60 billion package for Africa during Forum on China-Africa Cooperation (FOCAC), the US passed the Build Act which saw the creation of the International Development Finance Corporation, an agency that can invest up to $60 billion in the developing world; further the Trump Administration announced new strategy for Africa. The European Union proposed a new Africa-Europe Alliance for Sustainable Investment and Jobs involving a 25 per cent increase in the EU Africa budget for 2021-27 to about €40 billion. Given all these factors, what are the key focus points for Africa in 2019? Firstly, the indebtedness of African governments will be watched. The pace at which African governments are accruing debt is causing concern. The International Monetary Fund (IMF) points out that Sub-Saharan Africa public debt was at 57 per cent of its GDP in 2017, an increase of 20 percentage points in just five years. In other words, Africa as whole, owes more than half the value of its gross domestic product (GDP). In October the IMF raised Kenya’s risk of defaulting on debt repayments from low to moderate, forecasting the country’s total public debt will...

Rwandan official shave said that farmers and exporters will greatly benefit from the Electronic World Trade Platform (eWTP), an Alibaba e-commerce platform – the first of its kind in Africa, launched last year in Rwanda. The remarks were made during a 4 day workshop concluded on Friday in Hangzhou China where Rwandan officials were trained on the transformative impact and promise of a new data-driven digital economy and how to drive economic growth by accelerating implementation of digital solutions like e-commerce, e-finance, big data industries and other digital solutions. The eWTP aims at opening doors for small businesses in Africa to take part in cross-border electronic trade. During the workshop, twelve participants from Rwanda met with Alibaba executives for the training that aimed at equipping them with knowledge to continue supporting the development of Rwanda’s digital economy. Participants included the Ambassador of Rwanda to China Charles Kayonga, the CEO of National Agricultural Export Development Board (NAEB) Ambassador George William Kayonga and representatives from the Ministry of ICT and Innovation, the Ministry of Trade and Industry, Higher Education Council (HEC), Rwanda Utility Regulatory Authority (RURA), Rwanda Information Society Authority (RISA), Rwanda Development Board (RDB) and National Agricultural Export Development Board (NAEB). The CEO of NAEB Amb. George William Kayonga who was leading the delegation from Kigali also said that Rwandan farmers and exporters will benefit from eWTP as they will be able to directly export value added products to China, a country with a market of 1.4 billion people. Charles Kayonga, Rwanda’s...

For two countries always at each other’s necks with sanctions and counter-sanctions, it is odd that there is still a degree of booming business between Kenya and Tanzania. This is evident in the number of Tanzanians visiting Kenya for both business and pleasure. It is also seen in the volume of Kenyan goods finding a market in the southern neighbour. This is in spite of hurdles paving the road to the Tanzanian market. According to the tourism industry statistics published last week, Tanzania emerged as the second largest tourist source market for Kenya after the United States. There were 212,000 tourists from Tanzania to Kenya, translating to about 10 per cent of the two million tourists the country received last year. This is a meteoric rise from a meagre 25,800 in 2017. According to the Kenya Tourism Board (KTB), the three largest tourist source markets for Kenya were the United States, Tanzania and Uganda in 2018. In 2017, the United Kingdom, Germany, India and Italy were ahead of the two East African countries. “The USA remains Kenya’s top tourism source market, with 225,157 arrivals to Kenya in 2018 - accounting for 11.12 per cent of international arrivals,” said KTB in the sector report. “Tanzania was the second biggest tourism source market, contributing 212,216 arrivals to Kenya, equivalent to 10.48 per cent of international arrivals to Kenya in 2018. Uganda follows Tanzania as the third biggest tourism market, bringing in 204,082 arrivals - a 10.08 per cent share of international arrivals.”...

The Chinese government's move to cut taxes will further open the floodgates for cheap imports into Kenya, dealing a blow to local manufacturers. The three-year programme will see corporate-income, value-added and other corporate taxes for small and medium enterprises (SMEs) reduced, with the country's Central Bank cutting the amount of reserve a bank should maintain so as to release more money for lending. The move will enable Chinese factories to produce goods at far much lower costs, giving them an edge in the global marketplace. This comes as latest statistics show that China is Kenya’s largest source of imports for machinery and transport equipment, accounting for Sh291.8 billion. It's followed by India at Sh161.2 billion, Saudi Arabia (Sh138.4 billion) and UAE (Sh126 billion). With a conducive environment back home, Chinese companies could launch a trade offensive against Kenyan companies reeling from high energy costs, punitive licensing regimes, cheap imports and high taxes. In an interview, the Kenya Association of Manufacturers (KAM) Chief Executive Phyllis Wakiaga said the trend is worrying since Kenya’s import bill increased by 20.5 per cent from 2016’s Sh1.4 trillion, to Sh1.7 trillion and Sh25.6 billion in 2017. And the last 10 months of 2018, goods worth Sh997.1 billion came compared to Sh291.8 billion worth of exports, hurting Kenya’s quest of finding a home-grown solution that promotes local manufacturing and hence more exports. KAM said continued importation of goods, even those made locally, makes no sense of the government's plan to promote Kenyan firms. KAM noted that...

The biggest irony of poultry farming business in Kenya is that even as traders are busy importing eggs from Uganda, their counterparts are exporting chicks to that country. A roaring export trade of day-old chicks is erupted on the Kenya – Uganda border with the young birds destined not only for Uganda, but also Rwanda, Burundi and Democratic Republic of Congo (DRC). The truck transporting the chicks are ferrying them through Malaba and Busia border points to importers mostly based in Jinja, Kampala, Kigali and various towns in the DRC. Most of the chick exports are coming from poultry farms in Nakuru, Uasin Gishu, Kericho, Kisumu, Kakamega and other counties, but ironically not Busia county right on the Kenya – Uganda border. Kenya Revenue Authority (KRA) officials, both in Malaba and Busia, say between 5,000 to 10,000 day-old or slightly older chicks are exported daily to these regions due to high demand in those markets. “It is true we clear these delicate cargoes daily destined for markets in Uganda, Rwanda, Burundi, and even DRC. They are delicate cargo whose clearance to cross the border cannot be delayed for long,” a senior KRA official Joseph Owino said. He said the exports of the chicks from Kenya to these destinations started sometimes in late 2017 but by the end of last year had remarkably increased. Owino confirmed that most of the exports are coming from poultry farms in various parts of the country, even from central Kenya, there is virtually none from...