Logistics costs and operation time in Kenya significantly dropped last year on the back of strong digital processes at key points and improved infrastructure, a new survey shows. According to the 2017 Logistics Performance Survey recently unveiled by the Shippers Council of East Africa, cost and time indicators for road freight, sea, air and rail in Kenya last year dropped compared to 2015. Road freight turnaround time between Mombasa and Nairobi in 2016 was 26.4 hours down from 36.8 hours in 2015, and 10.7 days between Mombasa and Kampala, down from 15 days. Time taken by trucks from Mombasa to Kigali dropped from 17.5 days in 2015 to 12.5 days in 2016. This illustrates a 40 per cent truck turnaround between 2014 and 2016. Truck turnaround for Dar es Saam to key corridor destinations like Kigali, Bujumbura and Kampala remained steady with a marginal decrease of 18 per cent. Port dwell-time, the time it takes a vessel to arrive at the port area to the first berths, improved from 68 hours in January 2015 to about eight hours for the Port of Mombasa. This is attributed to the introduction of fixed berthing by the Kenya Ports Authority and the expansion of the port which increased its capacity. The custom processes at the port also decreased from 55 hours to 43 hours within the year. Nairobi has the shortest airport dwell-time in the region at an average of 28 hours for exports and 33 hours for imports while the airport in...

Kenyan farmers are set to enjoy a bigger market share after the European Union committed to cut agricultural export subsidies by end of January in line with a World Trade Organisation (WTO) landmark decision passed in Nairobi. Export subsidies refer to an array of credit and guarantee schemes extended to EU traders to make their products cheaper in foreign markets. The incentives include forex loss compensation, freight cost refund and total tax refund on exportable products. They are offered in addition to domestic support which is extended to farmers to lower the production cost. Over the years, export subsidies have allowed EU exporters to grow market share for its products in developing countries while exerting downward pressure on world market prices. Kenya, for instance, exported vegetable products worth €119 million (Sh14.3 billion) and animal products worth €9 million (Sh1.1 billion) to the EU in 2016, data produced by the European Commission indicates. The EU’s 28-member states have released a draft schedule showing that export subsidy cuts will take effect by the beginning of February if members don’t raise any objections. In a statement, chair of the WTO agricultural committee, Alf Vederhus, said the EU has become the second member to initiate the process of eliminating subsidies after Australia. “The EU submitted, as part of the draft goods schedule for its 28 member states, a change of commitments incorporating the implementation of the landmark 2015 decision by WTO members to eliminate farm export subsidies,” Mr Vederlus said. Source: Business Daily

It's about 8 years since Rwanda became a member of the Commonwealth, what would you say the country has to show for it after the period? One of the most important things is that Rwanda shared common values with the 52 Commonwealth nations. The community has a total of 2.4billion people 60 per cent of who are under the age of 30 and in Rwanda you have a population which is 70 per cent under the age of 30. It is a very young population. If we are looking at our future, global problems that face us from wealth creation to climate change, employability among others are things we have in common. The Commonwealth Charter embodies in 16 clauses the sustainable development goals which was committed to by the entire world. If you look at the trajectory that Rwanda has been on for its future, developing dynamic and holistic systems, it very much reflects what the commonwealth has been doing. We have created a number of new opportunities. The best for Rwanda is what has been done about women empowerment to have about 64 per cent of those in parliament as women. We have been promoting women empowerment and women inclusion. We have also been promoting the development in terms of young people. We have the youth development index which I know Rwanda is using as the development index in relation to young people. There are also issues in relation to trade. There is a trade advantage being a member...

The financial cost of meeting Africa's infrastructure needs is estimated at $93 billion annually until 2020 to close the infrastructure gap, states Giovanie Biha, deputy executive secretary at the United Nations Economic Commission for Africa. Speaking at the 23rd inter-governmental committee of experts of Southern Africa last week, Biha expressed concern that the financial cost of meeting the continent’s infrastructure needs are substantial. “According to the African Development Bank, it is estimated that Africa needs about $93 billion annually until 2020 to close the infrastructure gap. Africa must look inwards in financing its infrastructure development and dismantling obstacles to intra-Africa trade and the movement of persons across the continent. "We need to prioritise and sequence the implementation of our infrastructure needs,” she stressed. Infrastructure deficit stumbling block for trade According to Biha, the continent’s road freight cost was about four times more than other regions of the world. Specifically, the intra-SADC cost of export is $1,904 per container and to import is $2,428 per container. Whereas the equivalent figures for intra-Association of South-East Asian Nations trade were $743.5 and $787.5, respectively. “Other RECs (regional economic communities) in Africa register even higher figures. Up north of the continent, a truck transporting millet/sorghum on the Koutiala–Dakar corridor has to pass through almost 100 checkpoints and border posts, and the driver can expect to pay bribes of about $437,” she said. As such, the infrastructure deficit is a major contributing challenge to trade facilitation, intra-regional trade and economic development and transformation in Africa. Energy...

Regional business leaders and experts have called for harmonised Information Communication Technology (ICT) and e-commerce policies, saying this would help fast-track socio-economic development in East Africa. Lilian Awinja, the East African Business Council (EABC) chief executive, noted that ICT is a key business enabler for sectors like trade, tourism, education and agriculture, finance and transport, among others. She added that many components of the ICT sector are cross-cutting and cross-border, hence the need for a harmonised legal and regulatory framework. The official added that the region must improve its e-commerce systems to boost trade and related services, among others. “The EAC region needs improved cross-border ICT infrastructure development to facilitate interoperability, and increased connectivity and digitalisation of government processes to reduce transaction cost of operations and ensure efficient and quality public services delivery,” said the EABC chief executive last week in a statement. Awinja was speaking ahead of the second East African Business and Entrepreneurship Conference and Exhibition, scheduled for November 14 to 16 in Dar es Salaam, Tanzania. EABC is the apex advocacy body of business associations of the private sector and corporate firms from East African Community (EAC) bloc. Lack of regional financial interoperability platform Robert Ford, the Northern Corridor Technology Alliance chief coordinator, said different ICT laws have hampered growth of regional e-commerce sector as they affect transactions. He said, without uniform policies, growth of services like mobile money and other money transfer services is limited due to lack of a regional financial interoperability platform. “So, we...

Deputy Minister for Trade, Industries and Investment, Engineer Stella Manyanya told parliament yesterday that Bagamoyo Port is expected to boost the country’s economy and attract major investments to the country. Construction of the port is being carried out through a collaboration of China and Oman. Also to be constructed around Bagamoyo area are over 190 industries, including the manure processing industry that will be put up by the government of Oman. When fully developed, the Bagamoyo Special Economic Zone will attract about 700 industries to become a strategic investment zone in East Africa. The Bagamoyo port and its affiliate industrial zone is meant to address congestion at the old port and support Tanzania to become East Africa’s leading shipping and logistics centre. The port is located about 75 kilometres from Dar es Salaam and 10 kilometres from Bagamoyo town. Mooted in 2013 by retired president Jakaya Kikwete, construction of the port has been hit by delays mainly associated with issued to do with funding. Compensation Issues to do with compensating landowners who were to be displaced also affected the project take off. But that has been solved with China Merchants Holdings International (CMHI), a port management firm agreeing to raise money for compensation. CMHI managing director Hu Jianhua said in a statement in a recent interview that the company would run Bagamoyo portvas one of its overseas ports. It is these financial constraints that have forced Tanzania to miss out on ownership of the $10 billion Bagamoyo Port and Special Economic Zone...

The trade ministry is to partner with the Uganda Registration Services Bureau (URSB) to have all the Small and Medium Enterprises (SMEs) registered. This, according to Amelia Kyambadde, the trade minister is aimed at reducing the losses government incurs in tax defaulters. She noted that the process is mandatory and everyone must embrace it. “We shall use the district commercial officers to have all the owners on board. We shall also use the Kampala Capital City Authority. The future is in formal business, you cannot operate business when you are not paying taxes or linked to any form of support or public sector,” she stated. Kyambadde was speaking during the sidelines of breaking of the ground ceremony for Arena Mall in Nsambya, a Kampala suburb. In 2016, Uganda was ranked as the most enterprising country in the world, flooring developed countries such as Germany, France. This was according to the data released by Apporoved Index, which researches about the most entrepreneurial countries worldwide. However, there have been various reports indicating the rampant rate of business collapse in the country, partly blamed on low entrepreneurship skills. Kyambadde says it is difficult to help the Government to help traders in informal businesses in different scenarios like trainings or giving them equipment when they aren’t registered.She said many people have for long been operating such businesses and she says is not good. Source: New Vision

From a slugging economic growth, job losses and rising concerns of food shortages and high costs, the administration of President Uhuru Kenyatta’s second term will have its plate full as he starts his last five-year term. The administration will now be keenly watched by the business community with expectations that it will move quickly to prop up an economy greatly hit by the political stalemate that has dragged on since the country’s Supreme Court annulled the August presidential election. This looming standoff between the government and the opposition has done more damage to the economy, scaring away investors, slowing down the economy and depressing tax collections. On Monday, the Kenya Private Sector Alliance (Kepsa) said that the four-month electioneering period had cost the country $7 billion in losses, with most of it coming from the frequent disruption of transport and industrial operations during the campaigns ahead of the August 8 election, and the persistent protests after the nullification of the results later in September. In the past one month alone, investors at the Nairobi Securities Exchange (NSE) have lost $2.27 billion. The bourse has seen the monthly volume of trading drop by almost 50 per cent to more than 490 million shares traded from a monthly high of 740 million, while the average traded volume before the August 8 election was 640 million shares data from Reuters shows. The administration will have to work overtime to inspire confidence in all economic sectors. Carole Kariuki, chief executive officer of Kepsa said...

Among the piles and piles of used clothes for sale at the central market in Arusha, Tanzania, was a green sweatshirt bearing the logo of Cougar Robotics Team 1403 and just a last name printed on the back. CBC News tracked down the original owner of the garment in Skillman, New Jersey, where Mihir Nayak attended Montgomery High School and was a member of the robotics team. Like many people in Canada, the U.S. and other wealthy western countries, Nayak had donated his unwanted shirt to a charity. But some countries don't want our used clothing anymore. The East African Community (EAC), which represents Tanzania, Burundi, Kenya, Rwanda, South Sudan and Uganda and makes up a significant chunk of the reuse market from North America, has proposed banning second-hand clothing imports. That's putting pressure on a lot of people who rely on the trade in Canada and overseas: from the charities who collect the goods to the recyclers, resellers and workers employed along the way. For Diabetes Canada, clothing donations sold to Value Village account for approximately one-quarter of their annual revenue. Why charities want your old, stained and ripped clothes "The trust which runs the textile diversion business is able to contribute over $10 million a year to our mission," Scott Ebenhardt, director of business development at National Diabetes Trust, said. "It's a massive revenue generator for us." Diabetes Canada, along with other Canadian charities, partner with for-profits like Value Village to sort, grade and resell the donations they receive. Value Village then sells them through their retail stores, and any excess clothing suitable for reuse...

East and southern Africa leads in intra-African trade with the highest share of between 18 and 19 percent, which reflects Common Market for Eastern and Southern Africa (COMESA) and Southern African Development Community’s (SADC) effective agenda in consolidating trade and development in Africa. North Africa and Central Africa have the lowest share of intra-African trade of 5.3 and 2.1 percent, respectively. This information is contained in the Trade Finance in Africa Survey Report by the African Development Bank Group published in September 2017, which tracks the changes that have occurred in the trade finance market in Africa during the period 2013-2014. The report reveals that compared to other regions of the world, Africa’s trade is still dominated by international trade, where the European Union accounted for 63 percent of total trade, 50 percent for North America and 52 percent for Asia in 2014. Intra-African trade only accounted for 15 percent of overall trade in the same year. The report also reveals that significant challenges lie ahead in meeting the demand for trade finance by African firms, of which the majority is composed of SMEs. Trade finance is a relatively low-risk activity in Africa with an average default rate of 5 percent, while a high proportion (87 percent) of banks on the continent are engaged in trade finance activities. The survey disclosed that banks in West Africa have more significant exposure to trade finance with a 31 percent share of their total assets devoted to that activity, followed by Central and...