Last week, Uganda announced that the construction of the standard gauge railway (SGR) linking Kampala to Kenya would begin later this year. This gave plans to make Mombasa Port a major regional hub a major shot in the arm. It also put to rest fears that Kampala had decided to execute another about-turn as it did with its crude oil pipeline and build a rail-link to Tanzania. For this, Kenyans — including the China bashers — can thank the Export-Import Bank of China, the financier of both the Kenya and Uganda railway lines, for persuading Kampala to stick to the original plan. China’s decision to make Kenya its hub for the greater Eastern Africa region may also have played a role in persuading Exim Bank to take a hard-line. The hope is that key players in Kenya’s infrastructure sector recognise they are racing against time, and the world out there is growing in hostility at the same pace that the country is pulling ahead of its neighbours. This means the tearing up of all past plans based on the need to maintain good neighbourliness, and drawing up of new ones based on emerging realities. For starters, it helps that the Kenyan and Ugandan sections of the new railways will initially be operated and maintained by the same Chinese firm. The expectation is that the operator will do its best to maximise on returns. Last month’s signing of a partnership between Pacific International Lines (PIL) of Singapore and China’s Guangzhou Nansha...

Many renowned American and European clothing lines and stores source their apparel products globally, attracted by the lower operating costs that countries such as Bangladesh, China and Vietnam offer. One company based at Baba Dogo’s Balaji Export Processing Zone (EPZ) in Nairobi has also made its name as a good source of high-quality ‘Made in Kenya’ products if the list of its clientele is anything to go by. United Aryan (EPZ) Limited makes a wide range of products including denims, leggings, trousers, skirts, shorts, fleeces, knit tops, shirts, robes and pajamas. The firm, which is owned by Dubai-based Pankaj Bedi, lists US-based stores such as JC Penney Company, Walmart, Kohl’s, Macy’s, H&M and Sears as some of its customers.  It also serves clients in Kuwait, Bahrain Morocco and Mauritius. About 10 per cent of its products are sold locally.  Mr Bedi, who also serves as United Aryan chairman, was in the country recently to inspect his business, which he says makes between Sh5 billion and Sh7 billion annually in revenues. “Aryan trains all employees in a specific task along the value addition chain, allowing them to specialise on certain products which they are then able to manufacture to perfection,” he told Enterprise. The company started out 15 years ago with one unit of 17 lines. At the moment, United Aryan has four units made up of 64 lines and 3,900 individual machines with the capacity to produce and wash more than 80,000 pieces of attire on a daily basis. To...

Last week, Uganda announced that the construction of the standard gauge railway (SGR) linking Kampala to Kenya would begin later this year. This gave plans to make Mombasa Port a major regional hub a major shot in the arm. It also put to rest fears that Kampala had decided to execute another about-turn as it did with its crude oil pipeline and build a rail-link to Tanzania. For this, Kenyans — including the China bashers — can thank the Export-Import Bank of China, the financier of both the Kenya and Uganda railway lines, for persuading Kampala to stick to the original plan. China’s decision to make Kenya its hub for the greater Eastern Africa region may also have played a role in persuading Exim Bank to take a hard-line. The hope is that key players in Kenya’s infrastructure sector recognise they are racing against time, and the world out there is growing in hostility at the same pace that the country is pulling ahead of its neighbours. This means the tearing up of all past plans based on the need to maintain good neighbourliness, and drawing up of new ones based on emerging realities. For starters, it helps that the Kenyan and Ugandan sections of the new railways will initially be operated and maintained by the same Chinese firm. The expectation is that the operator will do its best to maximise on returns. Last month’s signing of a partnership between Pacific International Lines (PIL) of Singapore and China’s Guangzhou Nansha...

DAR ES SALAAM, TANZANIA - Tanzania should open up its Dar es Salaam port  to trudge cargo volume, expand and build new transport links to make Tanzania a regional hub while turning the country as Dubai of East Africa, the East African Business Week can report.  “The Dar es Salaam port is an engine for economic growth, if we invest in logistic centers, improve on infrastructure and create a facilitative environment, we can easily turn Dar es Salaam into another Dubai of its kind in East Africa,” said Tanzania China Mining Association Chairman Superintended Andrew Huang. The fifth phase government under Dr. John Pombe Magufuli has a chance to use effectively the Dar es Salaam port to increase 100% of the country source of revenue to foster the city to become a Dubai of the East Africa region. Speaking to East African Business Week exclusively,  Andrew Huang said the measures taken by President Magufuli have removed bureaucratic hurdles hence promote cargo volumes from neighboring countries and abroad. He said it is easy to attract all large investors and make Dar es Salaam a huge financial center by allowing and encouraging colossal banks to invest and conduct financial business and market in the country. Huang noted the city of Dar es Salaam deserved to have well-constructed roads, railways to the central line, buildings, malls and fast track it as a satellite city ready for massive investment from international business people. Tanzania, just like its neighbor Kenya, wants to capitalize on a...

Kenya has kicked off their side of the infrastructure projects that were promised and agreed to by the East African Community members under the East African Railway Master Plan. The US$ 24 billion project, with the Acronym LAPSSET (Lamu Port, South Sudan Ethiopia Transport Corridor) is a massive infrastructure project originating from Kenya, consisting of a 32-berth port on the country’s north coast, a railway, an oil pipeline, highways, international airports, and resort cities. This will definitely answer the question of ensuring a timely delivery of goods to both local and international markets for the area so affected. There have been, however, several hickups to the project mainly due to bickering by member states and disagreements that, do not seem to originate from realistic objections or issues other than differences in opinion and, perhaps ego. There was a pipeline slated to use this same LAPSSET corridor from Uganda to the coast, but this was shelved in favour of the Tanzania route. Ofcourse, there are issues of security in the north of Kenya, with several swathes of land being rather lawless due to the difficulty to reach these areas. However, one of the creators of the project, Gerrishon Ikiara, says the infrastructure project itself will bring about security in the area due to the fact that the area will now be easy to reach. This is all good, but there is an air of going it alone in this project. The name LAPSSET does not have anything to do with the...

ARUSHA, Tanzania - The United States Agency for Development (USAID) has met with officials of the East African Community (EAC) Secretariat to operationalize the five-year Regional Development Objectives Grant Agreement (RDOAG) they received last year.    “RDOAG provides for changes in the way USAID will do its business; strengthen USAID-EAC Partnership; stronger collaboration, coordination and communication, and institutional strengthening,” said Candace Buzzard, USAID’s Deputy Mission Director for Kenya and East Africa. USAID granted EAC US$194 million under the RDOAG which was launched in November last year, money is meant to be spent on shared development goals over the next five years. The money is to benefit sectors funded under the RDOAG which include among others health, environment, natural resources, climate change, trade, security and energy.Buzzard said USAID will coordinate more closely with the EAC to ensure better delivery of project goals. “USAID’s gesture had sent a strong signal of its desire to support the Community attain its goals,” said, the EAC Secretary General, Ambassador Libérat Mfumukeko. Mfumukeko said USAID’s contribution would enable the Community to achieve many things. He said of the US$194 million, about US$30 million will finance institutional strengthening within the EAC Secretariat while the remainder will support other development partners in their efforts to contribute to the EAC regional integration agenda. The Secretary General said that the new EAC-USAID Regional Development Objective Grant Agreement (RDOAG) 2016-2021 would deepen integration, improve cross-border risk management and strengthen regional institutions leadership and learning. He added that the RDOAG would support...

Songwe – February 1, 2017 – A Swedish delegation led by the Director General for Trade in the Swedish Ministry Foreign Affairs, Ms Karin Olofsdotter, and the Director General for International Development Cooperation, Johannes Oljelund and the Swedish Ambassador to Tanzania, H.E Katarina Rangnitt visited the Tunduma One Stop Border Post (OSBP) currently under construction. The border lies between Tanzania and Zambia. The visit was organised by the Swedish Embassy in Tanzania in collaboration with TradeMark Africa (TMA). The visit provided an opportunity to assess the impact of different trade facilitation initiatives being supported by the Swedish government and other development agencies aimed at improving the lives of Tanzanians by strengthening the business environment. TMA is providing funding to the Government of Tanzania through the Tanzania Revenue Authority (TRA) for the construction of the Tunduma OSBP and is working with border agencies in Tanzania and Zambia to set up mechanisms for integrated border management and harmonization of customs procedures. This aims to reduce waiting times at the border post by 30% within 18 months. Congestion at Tunduma, the busiest border in Tanzania in terms of volume of cargo, makes Dar es Salaam Port unattractive to importers in East and Central African countries. Transit cargo traffic represents about one third of total cargo handled by Dar es Salaam but this could drop if urgent action to decongest the border town is not taken. Deficiencies in the existing regulation, management and administration and the poor state of physical facilities at the border...

As director general of the World Trade Organisation (WTO), Pascal Lamy found himself at the front line of globalisation, which for him has had the extremely positive effect of reducing poverty, even as he recognises that it has created greater inequality. He believes countries that have opened up to trade have fared better in terms of growth and development than others, and he disagrees with the assertion that we are approaching the limits of the current system. Globalisation, he argues, is just another form of capitalism, whose ability to create efficiencies and reduce poverty is well known. But these benefits come at the expense of destructive and creative processes – “it works because it’s painful and it’s painful because it works.” He can’t see a crisis of globalisation that isn’t a crisis of capitalism, and capitalism is in a permanent state of crisis, always re-inventing itself. The problem is with distribution of the benefits of the greater efficiencies, which is more acute than it was 20 years ago. But we cannot reverse these effects by closing down trade, he says. The problem is one of social policy, of local consensus over taxation and social security – social issues not very different from those we faced in the nineteenth century. What he does think needs to be improved are global systems of governance. Regulation of international relations and the organisation of global cities can no longer rely on nation states alone, but must also involve NGOs, multinational businesses, governments and cities....

IN SUMMARY IMF managing director Christine Lagarde said fissures in the bloc over Economic Partnership Agreement, the single tourist visa, non-tariff barriers on movement of people, goods and capital were signs that the building blocks were not firmly in place. While the EAC has achieved major milestones on integration projects like the Customs Union, Common Market, the East African Legislative Assembly, EAC Court of Justice and others, differences on some issues are increasingly threatening the bloc’s future. The International Monetary Fund fears that the integration of East African economies may have been built on quicksand and has called for a pause to lay a stronger foundation for its stability. IMF managing director Christine Lagarde said fissures in the bloc over Economic Partnership Agreement, the single tourist visa, non-tariff barriers on movement of people, goods and capital were signs that the building blocks were not firmly in place. “Coming from the European Union and a country that is part of the Eurozone, I would certainly stress that making haste slowly is probably the best way to go and consolidate one step at a time, to make sure that the steps you have taken are actually solid, sustainable and will take you to the next level,” Ms Lagarde said while on a visit to Kampala, Uganda last week. She said the East African Community should focus on consolidating integration gains achieved in infrastructure, the Common Market and the Customs Union integration while going slow on the monetary union and federation projects in...

The betrayal of Kenya’s candidacy of the African Union Commission chairperson’s post is the latest salvo in a furious wave of discordance in the East African Community — from the civil strife in Burundi and South Sudan, and the abrupt re-routing of major regional infrastructure, railways and oil pipelines to the petulant turning back on the Economic Partnership Agreement with the European Union (EAC-EU EPA) that had peaked in August last year. The EAC partners are doggedly putting their differences and national interests first instead of embracing the cause of regional integration. It is negative developments like these that led to the collapse of the old EAC in 1977. Differences between Kenya’s Jomo Kenyatta and Tanzania’s Julius Nyerere on ideological and economic grounds made for an unstable integration at best. When, finally, Nyerere could not sit at the same table with Uganda’s Idi Amin, the EAC collapsed. The Treaty reviving the EAC in 1999 sought to settle the problem of the overbearing heads of state by providing that they would hence exercise only the advisory role to “give general directions and impetus” to regional integration. The executive authority of the EAC would be vested in the Council of Ministers. The Summit chairmanship was rendered a largely honorific entitlement of the heads of state exercised on a yearly rotation. It is the insistence of the leaders on championing their national rather than the common interest that has led the EAC to its present impasse. The first chair of the Summit, President...