The COVID-19 pandemic is disrupting Africa’s development trajectory. It is exacting a substantial socio-economic toll and putting the survival of half of the continent’s micro, small and medium-sized enterprises (MSMEs) at risk. Four in five African businesses are witnessing a dramatic reduction in sales. As African countries restart their economies and phase out COVID-19 restrictions, the ripple effects of the Ukraine crisis increase daily. The effects are particularly acute in terms of food security, given the continent’s reliance on food imports from the region of conflict. In addition, the rising cost of fertilizers and the impact of climate change are exacerbating food shortages. These shocks have slowed progress towards achieving SDG2, which is zero hunger by 2030. A 2021 joint publication by FAO, the United Nations Economic Commission for Africa (UNECA), and the African Union titled, Africa: Regional Overview of Food Security and Nutrition indicated that over one-fifth of the continent’s population faced hunger in 2020. That is about 281.6 million people—46.3 million more than the figure for 2019. Due to the current harsh economic realities in countries, the International Monetary Fund is encouraging governments worldwide to subsidize the cost of food and energy for their poor. Such a social intervention presents a huge fiscal challenge for many African countries. What then is the solution? An effective solution is to boost intra-African trade, which has the potential to pave the way to food security. Africa has enough food to ensure its citizens do not face hunger; however, the challenge is...

East African states have been urged to for fast-tracked harmonisation of East African Standards to aid trade in the region. Speaking during an engagement in Dar es Salaam, Tanzania over the weekend, private sector players said the move will significantly contribute to the growth of intra-regional trade, competitiveness, protection of consumers& environment and overall trade facilitation. Evidence shows harmonization of standards has increased intra-trade by 10 per cent, reduced inspection and clearance costs at the border from $500 to $400 and clearance days from 10 days to 0.5 days. A total of 624 indigenous standards have been adopted by the EAC partner states and a total of 1880 standards have been earmarked for harmonisation at the EAC level. Other notable reforms include: the establishment of the Regional Standards Plan (RSP) and an Online catalog of harmonised standards has been developed since 2021. The National Standards Bureaus in the EAC Partner States are at different levels of harmonisation of standards ranging from 65 per cent to 90 per cent. More specifically Burundi and South Sudan have significant administrative and capacity challenges and hence have noted the adoption of harmonised East African Standards. East African Business Council (EABC) CEO  John Bosco Kalisa urged partners to Fast-tracking the adoption of the Standardisation, Accreditation and Conformity Assessment (SACA) Bill. ''This will facilitate frequent peer reviews, creating awareness and on East African Standards and involve the private sector in the development of the standards,'' Kalisa. Manufacturers have further called for a demand-driven and low-cost approach...

The forum will provide a platform for heads of EAC organs and institutions to enhance awareness and understanding of the various commitments in the integration pillars and the governing instruments that are in place at the EAC level to DRC government officials.  The East African Community (EAC) Secretary General Dr. Peter Mathuki is set to lead a delegation comprising the Heads of EAC Organs and Institutions and eminent regional business leaders to the bloc’s newest partner state, Democratic Republic of the Congo (DRC) from September 6 - 9. The EAC maiden mission to Kinshasa aims at enhancing awareness among DRC government officials on the existing EAC instruments, creating trade synergies, exploring and building business partnerships and immediate linkages for business associations. The four-day mission will kick off with a two-day forum amongst DRC Government officials and the EAC Secretariat, the East African Legislative Assembly (EALA) and the East African Court of Justice (EACJ) as well as the eight institutions of the Community. The forum will provide a platform for heads of EAC organs and institutions to enhance awareness and understanding of the various commitments in the integration pillars and the governing instruments that are in place at the EAC level to DRC government officials. “This forum will create a platform to enhance understanding by DRC government officials on the EAC integration instruments such as protocols, laws, policies and strategies,” Dr. Mathuki said. The DRC delegation will be led by DRC’s Vice Prime Minister and Minister of Foreign Affairs Christophe Lutundula Apala Pen’Apala. On September 8 and...

The Democratic Republic of Congo (DRC) is now the third largest market for the port of Mombasa with a reported market share of 8.2 per cent, Kenya Ports Authority (KPA) has said. To cement its position, Lignes Maritimes Congolaises - a DRC government-owned shipping line, began operations in June this year, becoming the latest entrant at Kenya’s biggest port. “With the formal admission of the DRC to the  East African Community (EAC), more private and public organisations from the Central Africa country are setting up businesses in the country,” KPA noted in an update. https://youtu.be/vQxvNIdRu_s A delegation from the DRC has visited the  Inland Container Depot (ICD) in Nairobi to survey the facility - a key hub in the transport sector. It plays a crucial role in the effective movement of cargo locally and to the transit markets. “The team was impressed with the seamless intermodal transfer of cargo from Mombasa to ICD Nairobi via the standard gauge railway) and final evacuation through the highly efficient smart gates,” KPA said. “The ICD, which was recently upgraded, now has an annual capacity of 450,000 TEUs (twenty-foot equivalent unit).” Uganda accounted for more than a quarter of the business at the port in 2018, pushing the total transit volumes up by 10 per cent from 8.6 million tonnes in 2017 to 9.6 million tonnes. Uganda remains a key trade partner for Kenya with most of its exports and imports passing through Mombasa. Meanwhile, EAC Secretary General Peter Mathuki is set to lead a delegation of the...

Mombasa governor-elect Abdulswamad Nassir has promised to improve the business environment once he is sworn in on September 15. He promised to lower the cost of doing business by collapsing various trade licenses into one. Nassir spoke during a dinner with members of the Mombasa business community organised by the Kenya Chambers of Commerce and Industry Mombasa chapter on Friday. “I have already asked my county team to go through the fees and come up with a one-stop figure. This means you only pay for one license. "Instead of one business paying for health, fire and other county charges, these will all be included in one permit,” he said. The governor-elect said he will set up a business directorate in the Office of the Governor, whose job will be to ensure there is the ease of doing business. The directorate, he said, shall be reporting directly to him giving him weekly reports. “We have begun discussions around having a single permit, which means going forward, you will not necessarily have to pay something different for trade license, health, or for fire safety compliance,” Nassir said. He also promised to have quarterly engagements with the business community. “Our first agenda is to revive the economy of the county and there is no best way to begin this than by engaging the stakeholders,” Nassir said. The governor-elect also promised to push for the Open Skies Policy at the Moi International Airport in Mombasa, to boost international tourism. He said the country cannot...

The East African Community (EAC) has reaffirmed its commitment to infrastructure development aimed at boosting intra-regional trade and free movement of persons across the organization’s seven member states, the EAC said in a statement late Monday. The statement issued by the EAC headquarters in Tanzania’s northern city of Arusha said the commitment was made by the EAC Deputy Secretary General Steven Mlote in charge of Planning, Infrastructure, Finance and Administration when he held talks with Tanzanian parliamentarians. Mlote assured the visiting delegation from Tanzania’s parliamentary committee responsible for Foreign Affairs, Defense and Security of the EAC’s readiness to implement various infrastructure projects coordinated jointly by the EAC secretariat and member states. The parliamentary committee was on a one-day working visit to the EAC headquarters over the weekend, said the statement. The EAC member states are Burundi, Kenya, Rwanda, South Sudan, Tanzania, the Democratic Republic of the Congo and Uganda. Enditem Read original article

The African Continental Free Trade Area (AfCFTA) agreement which was approved in 2021, provides a unique opportunity to boost growth, cut poverty, and reduce Africa’s dependence on the boom-and-bust commodity cycle. The agreement further seeks greater regional economic integration and a more significant contribution by African countries to global trade. According to the 2020 report by the World Bank on Making the Most of the African Continental Free Trade Area: Leveraging Trade and Foreign Direct Investment to Boost Growth and Reduce Poverty, AfCFTA will cover 55 member countries, with a continental population of 1.3 billion people and a combined annual GDP of $3.4 trillion. When fully implemented, it is estimated the agreement could boost the region’s income by $450 billion annually and provide new opportunities, including trade, agriculture, manufacturing, e-commerce, cultural and transport sectors. Trade In particular, Annex 4 to the AfCFTA treaty aims to simplify and harmonize international trade procedures and logistics to expedite the processes of importation, exportation and transit; and expedite the movement, clearance and release of goods, including goods in transit across borders within State Parties. This simplification is important for Africa to maximize potential gains from the AfCFTA, which is made clear by looking at the high trade costs of crossing borders on the continent. As the map below illustrates, many African countries have borders ranking at the top of the most restrictive in the world as measured by the costs of cross-border trade.   Transport For historic reasons, bilateral and regional trade in Africa has been hampered...

Digitalization brings new opportunities in trade and creates the potential to underpin resilience in times of crisis. The digital transformation of African customs and borders could improve efficiencies in processes and yield trade gains on the continent of US$20 billion a year. With digital trade in place, pre-existing bottlenecks in infrastructure can be tackled, efficiencies can be leveraged, and innovative solutions can be harnessed. However, countries in Africa vary greatly in their readiness for digital trade.  In African countries where economic resilience must be fostered, jobs must be created and, entrepreneurship skills must be facilitated, digital trade must be in full swing.  How digital automation is easing the flow of trade  Thanks to technological advances, importing and exporting goods and services in Nigeria has become easier thanks to the rise of online international trade administration portals. These online portals automate the experience for many stakeholders, including customs officials, businesses importing finished goods and raw materials for manufacturing, and those exporting their goods across the globe.  Blockchain technology, Artificial Intelligence (AI), state-of-the-art payment solutions, fraud detection and prevention, and warehouse management solutions are helping to increase the ease of trade, streamlining border management, and identifying and potentially overcoming issues that impact timeframes, logistics and transportation.  Using a platform of this type, such as Webb Fontaine’s Single Window for Trade, provides clients with a wide spectrum of up-to-the-minute information, including trade formalities, import and export procedures, latest tariff codes and rates, as well as fee simulation features. Businesses can fill in pre-arrival...

The use of improved crop varieties can increase agricultural productivity and enhance the welfare of farmers. This study examined whether the adoption of improved maize varieties (IMV) is associated with the increased welfare of farmers in rural Ethiopia. A panel data set with 1886 observations collected in three waves from 2009/10 to 2014/15 were used for the analysis. The adoption decision was modelled using a double-hurdle model, and the welfare effect of IMV adoption was estimated using a fixed-effects instrumental variable approach. Our findings reveal that IMV affects the welfare of farmers. Specifically, we found that IMV adoption increases households' income, asset ownership and maize consumption while also reducing income poverty. The poverty estimates indicate that a 10% increase in the area allocated to IMV was associated with a 4.79% reduction in the probability of being below the $1.90 poverty line. However, the poverty-reducing effect of IMV adoption was heterogeneous across households, with the most pronounced effect experienced by households with extensive landholdings. Our findings suggest that facilitating access to IMV and land under cultivation can effectively improve farmers' welfare and reduce poverty in rural Ethiopia. Read original article

Kenya expects the introduction of the 35 per cent Common External Tariff for the East African Community (EAC) partner states to catalyse its manufacturing sector. Principal Secretary State Department of EAC Kevit Desai (pictured) said the tariff will see innovation and gains in the manufacturing sector including increased production and value addition. He added that the Common External Tariff has access to 300 million consumers. “That is equal to approximately Sh35.4 trillion ($300 billion) worth of Gross Domestic Product (GDP),” he said. Dr Desai said this in itself is a remarkable opportunity as far as access to market is concerned. He said the tariff ensures there is a level playing field achieved and provides the region with the chance to nurture the entire industry. The tariff, he says, will have an impact on 60 per cent of the existing manufacturing base. The new tariff took effect July 1, 2022. The agreement is all member states of the EAC will cap their duty at 35 per cent for final or finished products. There are 499 products that will be affected. It is however anticipated that while this may have a negative effect on the economy, it will not last long as more jobs will be created through increased trade and industrialisation. The supply of the 499 products (tariff lines) affected is considered to be adequate within the region and can still be accessed either through EAC Free Trade Agreements(FTA) or other FTA between EAC member states that belong to another economic bloc like...