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One Belt and One Road initiative is good for Africa – Amb. Kayonga

Rwanda’s ambassador to China, Lt. Gen. Charles Kayonga has praised the Belt and Road initiative as a platform for Africa to grow with the rest of the world. He said the initiative, pioneered by Chinese leader Xi Jinping gives developing countries space to have a say in the global economy, create jobs and prosperity. The Belt and Road forum opened in Beijing on Sunday. In his opening address, president Xi Jinping said the initiative aims to promote economic interdependence, inclusiveness and win-win cooperation. “Manufacturing will open up economies of countries along the belt and road, create employment and reduce inequality,” said the Chinese leader. Hundreds of delegates are attending the forum, including 29 heads of state. Ethiopian Prime Minister Hailemariam Desalegn and Kenya’s president Uhuru Kenyatta are among the leaders in attendance. Among others, the initiative seeks to build a network of infrastructure connecting China to Asia, Europe and Africa in the form of highways, bridges, sea ports and industrial parks. China is injecting $18.8bn in the Silk Road fund to give more momentum in the initiative, Xi said. He also pledged $8bn in aid to developing countries and international organization along the belt and road for education and humanitarian work. Kayonga said the belt and road initiative the vision of Africa’s Agenda 2063, which aims to integrate the continent and to develop sustainable economies. “The Belt and Road initiative is one of the mechanisms for infrastructural development. East Africa is working with China to develop a standard gauge railway...

Open airspace will bring millions of dollars into the region’s economy – study

More than 46,000 jobs and $202 million could be added to the region’s growth domestic product (GDP) per annum if East African Community (EAC) member countries embrace the open sky policy, a new study indicates. The study by the East African Business council (EABC) estimates that liberalisation of the airspace between the six EAC countries could result in an additional 46,320 jobs and $202.1 million per annum in GDP. According to the study, there is compelling evidence that full liberalisation of restricted routes will lead to about 9 per cent lower average fares and a 41 per cent increase in frequencies, which in turn will stimulate passenger demand across the region. “This study demonstrates that increased air service and traffic resulted in positive benefits for the total EAC economy,” said Lilian Awinja, the EABC chief executive officer. Sector players say one of the factors contributing to the slow implementation of the Yamoussoukro Decision principles is a lack of clear and specific information regarding the impacts of enacting air transport liberalisation. “The East African Business Council (EABC) and the EAC secretariat, therefore, commissioned the study on the costs and benefits of open skies in the EAC bloc to understand the impact of implementing the Yamoussoukro Decision in East Africa,” she noted . She added that  liberalisation of air transport contributes to “greater trade and tourism, inward investment, productivity growth, increased employment and economic development” besides being supported by regional stakeholders. According to aviation experts, liberalisation offers a means to restructure national...

Uhuru bags Sh370b for SGR extension

The Chinese government has approved Kenya’s request for Sh370 billion from the Exim Bank of China for the construction of the third phase of the Standard Gauge Railway (SGR) from Naivasha to Malaba through Kisumu. During bilateral meetings between President Uhuru Kenyatta, Chinese President Xi Jinping and Premier Li Keqiang, the leaders also agreed to designate the SGR as a critical route that needs enhanced security. President Xi said China will be represented at the launch of the first phase of the SGR next month by a high-level delegation led by a special envoy and two ministers. He also said that China will prioritise capacity building for Kenyan engineers and technicians who will manage the SGR and the trains. The building of the 120km phase II Nairobi-Naivasha SGR estimated to cost Sh153 billion is on course with contracted builder, China Road and Bridges Corporation. The second phase which links SGR to Naivasha’s planned special economic zones and the Olkaria geothermal fields begins a month after the June 1 commissioning of the inaugural 427 km Mombasa-Nairobi line that starts at Mombasa Port. The first phase of the project costed Sh327 billion. President Uhuru, who is in China to attend a major infrastructure conference and hold bilateral talks with Chinese leaders on trade and development, also walked away with more funding for infrastructure projects including Sh16.5 billion for the construction of the Nairobi Western bypass. During the talks, China elevated its relationship with Kenya to that of comprehensive strategic co-operation, giving the...

Britain raises hope for Economic Partnership Agreement

Britain has assured Kenya its imminent exit from the European Union will not affect trade ties in any way. The assurance by British Prime Minister Teresa May to President Uhuru Kenyatta on the sidelines of the London Conference on Somalia last week came against the backdrop of growing uncertainty over the future of Kenya’s exports to the UK over failure by East African Community (EAC) nations to sign an Economic Partnership Agreement (EPA) deal. EPA would guarantee EAC traders duty and quota-free access to the EU market in exchange for gradual opening of up to 80 per cent of the region’s market to European products. Tanzania, the main opposer of the deal, cited the economic and constitutional uncertainties arising from Brexit as the reason for rejecting it. It argued that with the exit of Britain from the core market, it had little to gain from the partnership agreement negotiations and signing up the deal would not in any way spur its national interests. Kenya has been putting up a spirited fight to have all EAC countries get on board as a way of safeguarding unlimited duty free access of its exports to Europe. Tanzania and Uganda have stalled in signing the deal initialised in October 2014, saying it needs to be renegotiated afresh following Britain’s exit from the EU. But following last week’s meeting between President Kenyatta and PM May, the latter assured Kenya its exit from the trade bloc would not affect trade arrangements between the two countries. “The...

China boosts bilateral ties with Kenya

Xi made the remarks when meeting with his Kenyan counterpart Uhuru Kenyatta, who attended the two-day Belt and Road Forum for International Cooperation held in Beijing. Xi said the comprehensive cooperative partnership between China and Kenya has developed rapidly in recent years, and the bilateral ties are at their best time in history. He proposed that China-Kenya ties be upgraded to comprehensive strategic cooperative partnership, calling on the two sides to view bilateral ties strategically. The two sides should keep their high-level exchanges, and continue to support each other on issues related to core interests and major concerns, Xi said. Through the construction of the Mombasa-Nairobi railway, the Chinese leader said the two sides should build a corridor of industrial economy and jointly forge a new pattern of cooperation integrating the railway, Mombasa port and Mombasa special economic zone. He said the two nations should strengthen cooperation on people-to-people exchanges and advance the program of Chinese culture center. He also called for deepened cooperation on peace and security issues and the judiciary, to deal with transnational crimes. On his part, Kenyatta said the forum had demonstrated to the world the tangible fruits of the Belt and Road Initiative, providing a historic platform for developing and developed nations to discuss cooperation on the basis of mutual benefit. He added that Kenya wants to strengthen coordination and cooperation with China on issues related to African peace and development, and develop a strong Kenya-China comprehensive strategic cooperative partnership and robust Africa-China relations. Chinese...

New cargo tracking tool to tighten East Africa ties

A new electronic cargo tracking system for monitoring cargo transiting through Kenya to neighbouring countries within the East African Community is expected to enhance trade competitiveness through improved security of cargo along transit routes. The Regional Electronic Cargo Tracking System (RECTS) integrates transit cargo tracking platforms for three Northern Corridor Countries namely Kenya, Uganda and Rwanda with plans to roll out the same to include South Sudan, Tanzania and ultimately to destinations outside the EAC bloc. RECTS, which is funded by Trade Mark East Africa (TMA) through a grant from the UK’s Department for International Development (DfID), will add to on-going efforts to reduce the cost of doing business in the region. The cost reduction is through improved cargo predictability and increased truck turnaround time that will ultimately lead to lower transport costs. The system will also enhance cargo safety and help traders to better predict arrival of goods. RECTS will also reduce time wastage because it sends an alert when a truck stays in a particular spot longer than needed. Furthermore, importers will be able to monitor the movement of their goods. Transport delays and cargo theft are among the key concerns to importers and exporters who are forced to pay high insurance cover for goods on transit. This new tool represents a key milestone in the drive to cement East African co-operation as this is the second major step taken after the roll out of the Single Customs Territory initiative in 2013. By integrating transit cargo tracking platforms,...

European Union woos Tanzania to sign trade deal

The European Union has invited the government of Tanzania for dialogue over the Economic Partnership Agreement impasse that has threatened to derail the trade pact between the bloc and the East African Community member countries. The head of the EU delegation to Tanzania and the East African Community, Roeland van de Geer, said they were awaiting Dar es Salaam’s position on the matter. “What is important is that we have dialogue,” said Mr Geer during the Europe Day celebrations in the Tanzanian political capital Dodoma last week. “Tanzania has its own convictions, the EU have theirs. Tanzania is a sovereign country and should take its own decisions,” he said, underscoring the importance of the dialogue. Tanzania has not signed the EPA, arguing that the trade agreement in its current form will have negative implications for its industrialisation strategy. Talks on the EPA are expected to feature for the East African Heads of State Summit on May 20. Only Kenya and Rwanda have signed and ratified the EPA deal, but being a Single Customs Territory, the other EAC members must sign the pact to make it enforceable. READ: EAC summit now set for May 20 Burundi has also not signed, citing the resumption of EU aid to Bujumbura as a precondition for its signature. Uganda, on the other hand, said it will only sign the EPA if there was consensus among the EAC members. Parliament's role The EU-EAC EPA promises duty and quota-free access to EU markets for East African goods...

A summit in a time of extreme crisis: Will the EAC hold?

The heads of the six East African Community member states will confront tough issues when they meet in Kampala, Uganda, on May 10 for their annual summit. The summit will provide another opportunity for the presidents to assess progress that the countries are making towards full integration and also address the emerging threats to regional security, stability and development. They will try to narrow their differences on the future of the regional economic bloc, which brings together over 170 million people with a combined national output of $157 billion in 2015. As Uganda’s President Yoweri Museveni assumes the leadership of the EAC from Tanzania’s President John Magufuli, the leaders will have less to celebrate as cracks widen on their binding commitment to the spirit and future of the EAC — some may indeed consider a Brexit type withdrawal. Tension within the political leadership of the community is apparent, particularly between Kenya and Tanzania — which have a long history of suspicions over shared benefits, one that led to the collapse of the first EAC in 1977. Presidents Museveni, Uhuru Kenyatta of Kenya and Paul Kagame of Rwanda have demonstrated strong support for economic empowerment of the EAC countries and their people by deepening regional integration and expanding intra-regional trade. The three are often referred to as the “Coalition of the Willing” but Magufuli has openly challenged the EAC principles. His administration, for instance, has tightened restrictions on Kenyans being employed or investing in Tanzania, effectively stifling the implementation of the...

East Africa to benefit from $1.1bn AfDB climate change fund

The African Development Bank (AfDB) will avail $1.1 billion to five African countries, including Kenya, to address challenges arising from climate change. The pan-African lender's president Akinwumi Adesina made the announcement Wednesday during the Feed Nigeria Summit in Lagos. Dr Adesina said the money would be used to address the current drought challenges in Nigeria, South Sudan, Kenya, Ethiopia and Somalia. He also urged African countries to industrialise the agricultural sector and its value chain in order to transform their economies. Dr Adesina called on governments to provide incentives to food and agribusiness firms in rural areas through establishment of staple crop processing zones. “These staple processing zones will transform rural Africa into new zones of economic prosperity,” he said. According to the AfDB chief, staple crop processing zones, which were vast in agro industries zones, would encourage food industries’ operators to establish factories in rural areas. “Africa has no business importing food. Africa should be a net exporter of food. “Agriculture in Africa must move away from being treated as a social sector for managing poverty to a business of creating wealth,” he said. Dr Adesina said AfDB had committed $24 billion investment to agriculture in Africa in the last 10 years. Source: The East African

Customs organisation pushes for more intra-African trade

Kampala- The secretary general of World Customs Organisation Kunio Mirukiya has called for combined efforts towards boosting intra-African trade, proposing a number of reforms to ensure customs facilitate trade within the region. “First is infrastructure at borders because what is lacking is systems that can facilitate movement of goods and people. Customs should coordinate border management, have one stop border post or a single window and more security by collaboration is what Africa should be looking at,” Mr Mirukiya said at the 22nd World Customs Organisation East and South Africa council governing meeting in Kampala last Thursday. The meeting that attracted 22 countries from East and South Africa was aimed at looking at how best customs can facilitate trade and creating a platform for countries to collaborate and fight mutual challenges within the region. According to Mr Tom Moyane, the commissioner of South African Revenue Service, intra-African trade is an opportunity for the continent to look at the comparative advantage and economies of scale it can enjoy. Mr Dickson Katashumbwa, the commissioner in charge of Customs at Uganda Revenue Authority (URA) said that if African economies are to be boosted, there is need to have money circulating within the region. Speaking at the event, commissioner general URA Doris Akol said the tax body is grappling with illicit trade involving counterfeits, substandard goods and drought which has affected revenue collections. In addition, terrorist financing and money laundering continue to present huge challenges. On money laundering, Mr Moyane said it is “a...