Over the last year, all eyes have been on Africa’s technology sector. And for a very good reason: infrastructure growth is booming. Between 2010 and 2016, seven new undersea cables brought fast data connections to the continent, with two more already under development. Meanwhile, mobile providers have invested $13.6billion into getting 500,000,000 Africans online by 2020. But as necessary as infrastructure investment is, it alone won’t take African business global. So what technological development or product has the potential to make African businesses global players? Tech sector already outperforms expectations A common misconception is that raw materials are the big African growth story of the last decade. But according to research by Freshfields, since 2004 Africa’s technology companies have delivered 19% annualised returns, compared to just 11% in commodities. A clue to why the African tech sector is growing can be found in the East African mobile payments industry. In most of the world, mobile payments is a niche sector, because consumers have many other convenient ways to pay -bank cards, credit cards and banking transfers, for instance. But in Sub-Saharan Africa, only 34% of people have a bank account. This used to be a significant barrier to any transaction that wasn’t small-scale or local. Or, in plain English, it was a huge inconvenience. Change began in 2007, when local telco Safaricom teamed up with Vodafone to develop the mobile-payment system M-Pesa. Its creators expected M-Pesa to have 250,000 customers by the end of its third year. After just two...

TANZANIA Private Sector Foundation will receive a $400,000 grant from TradeMark Africa to support operations of a national platform launched in Dar es Salaam over the weekend to bring together policy makers and industry stakeholders to collectively tackle the challenges of the logistics and freight industry. Speaking during the launch of the platform, TMA Country Director, John Ulanga said the grant would support activities of the platform which is hosted by TPSF which is intended to foster best practices and play a critical role in the logistics sector. Currently East Africa’s trade corridors are characterised by long transit times and high costs. Freight costs per kilometre are more than 50 per cent higher than costs in the United States and Europe, and for the landlocked countries, transport costs can be as high as 45 per cent of the value of exports. "This platform is aimed at addressing these challenges and improving the region’s competitiveness,” he said. The national platform is expected to allow players to innovate, add value and strategise in order to realize the common objective of making the logistics and freight industry more efficient, sustainable, and innovative and ultimately increase the country’s competitiveness in order to secure economic growth and alleviate poverty. The Platform is also expected to deal with logistics inefficiencies, delays in the movement of goods and services, challenges in implementation of national and regional logistics policies, and harmonisation of documentation requirements by customs in the country. Other challenges the platform will address are related to...

Tanzania’s demand for domestic transport is expected to increase by 16% in 2020 Dar es Salaam port throughput has increased from 7.4 million tons in 2007 to 14.26 million tons in 2014 with 18 million tons targeted for 2015/6 Logistics Performance Index for Tanzania shows a dramatic drop of 40 places while a survey by the Shippers Council of East Africa shows an increase in the cost of transit on the Central Corridor, as compared to a significant drop in costs on the Northern Corridor  Dar es Salaam – November 25th, 2016 – Stakeholders in the freight and logistics industry have today launched a national platform that is expected to bring together policy makers and industry stakeholders to collectively tackle the challenges of the logistics and freight industry. The National Platform is further intended to foster best practices, play a critical role in the logistics sector, that will allow players to innovate, add value and strategize in order to realize the common objective of making the logistics and freight industry more efficient, sustainable, and innovative and ultimately increase the country's competitiveness in order to secure economic growth and alleviate poverty. TradeMark Africa has committed to supporting the operations of the platform through a US$400k grant support to the Tanzania Private Sector Federation (TPSF) which will be hosting the platform. TPSF will organise other relevant freight and logistics players to influence major reforms in operational reforms in Tanzania. Chief Guest Professor Faustin Kamuzora, Permanent Secretary, Ministry of Transport, Works, Communication and...

  President Uhuru Kenyatta has urged Latin American and Caribbean countries to invest in Kenya. President Kenyatta said yesterday the changing global political and economic order such as Brexit and the election of Donald Trump as US President calls for countries to forge new trade partnerships. In a speech read on his behalf by Principal Secretary for Trade Chris Kiptoo at the first Latin America Caribbean Africa Trade Summit (LAC AFRICA) in Nairobi, the President said trade volumes between Kenya and the two regions is worryingly low. “Whereas we have been seeing the Chinese, Indians, Americans and Europeans up their investments in Kenya, and also trade with these countries grow, investments and trade from Latin America has remained stagnant. It is time we put this to an end,” he said. About 30 companies from Brazil, Uruguay, Chile, Colombia, Jamaica, Argentina and Costa Rica are attending the summit. Among the companies that have shown direct interest in making investment is the country are Jamaican conglomerate, Roth Capital and Tomae, which invests in energy and new technologies that control pollution. The company’s Chief Executive Delroy Howell said he will be making an announcement on an investment in the energy sector soon. Argentinian mobile service provider, PayPhone has also shown interest in investing in the nascent mobile technology sector. President Kenyatta noted that of all South American countries that trade with Kenya, only Colombia has a balance of trade deficit which is skewed in Kenya’s favour. The deficit stands at $12 million (Sh1.2...

Uncleared containers at the Port of Mombasa /ELKANA JACOB The Kenya Revenue Authority and clearing agents have agreed on a common cargo valuation process. This ends a month-long stalemate that had slowed the movement of cargo at the Port of Mombasa. The two parties resolved to continue using the Kenya Revenue Authority Evaluation formula, which mostly relies on declaration and documents presented by importers. This is opposed to a new system it had introduced last month which led to protests by clearing agents. In a joint public notice yesterday, the taxman and the Kenya International Freight and Warehousing Association said they will collaborate to enhance efficiency in cargo clearance at Kenyan borders. “This will be achieved through streamlining of KRA valuation dispute resolution mechanisms, and the strengthening of customs agents licensing processes,” the notice signed by KRA commissioner general customs and border control Julius Musyoki and Kifwa national chairman Auni Bhaiji stated. “During a meeting held at Times Tower on November 10, senior officials of KRA and Kifwa agreed to coordinate actions relating to valuation dispute resolution and the vetting of customs agents licence renewals with a view to professionalising the industry,” it added. The two also agreed to coordinate efforts in tackling cargo mis-declaration, which occurs through concealment and undervaluation. Musyoki had earlier indicated that the authority reviewed its cargo valuation process to curb tax cheats. “Importers have manipulated KRA systems which has led to an increase in undervaluation, mis-declaration and concealment of imported goods, including falsification of importation...

East Africa is in the midst of an infrastructure projects surge due to low steel prices, regional economic strength and Chinese support for projects. The cost of steel, engineering and design services have all been low this year, as a result of weak international demand. In addition, contractors have more spare capacity than usual, so projects can be developed more quickly. A quarter of Chinese steel production capacity has been shut-in during the year to date and so Beijing has been keen to find outlets for Chinese output. This has helped drive the current boom in pipeline and railway projects in East Africa, including the new Mombasa-Nairobi standard gauge railway line and Uganda’s planned oil export pipeline and railway to the northern Tanzanian port of Tanga, to name a few. Despite the rise in steel consumption in East Africa, other parts of the continent are unlikely to benefit from the same type of projects because of the economic downturn affecting many other countries. Weak Continental Demand The investment seen in East Africa is unlikely to be replicated in economies that rely on commodities, such as Zambia, Nigeria and Angola. Those African countries are facing extensive spending cuts, particularly where support from the IMF and other multilaterals is expected. With more emphasis on poverty reduction, the international lenders may not demand such deep spending cuts in return for loans as during previous downturns. Nevertheless, they are unlikely to countenance borrowing for big tickets infrastructural projects. Apart from anything else, the Mozambican...

The automation of trading at Kenya’s weekly tea auction is set to start with the provision of a Sh150 million grant in what would increase transparency in dealings and curb price manipulation. Trade Mark East Africa (TMA) has provided the money that will help in developing an online platform that will enable farmers and traders to participate in the auction without their physical presence at the Mombasa based auction. The automated system will enable farmers to monitor the process at the auction and get to know the actual price that their produce will fetch. “The introduction of ICT in the tea export process is expected to increase tea trade efficiency, transparency and overall governance,” says EATTA managing director Edward Mudibo. Players at the Mombasa Tea Auction were accused of colluding to fix prices and deny small-scale farmers their deserved earnings, according to a report filed by the tea regulator. The Competition Authority of Kenya (CAK) also accused various players of manipulating the price of the highest tea grade, PF1, which is mainly produced by small-scale farmers. EATTA, which runs the auction, reckons that prices are influenced by demand and supply and that the automation will also help clear the negative assumption of market manipulation. “The auction process offers an opportunity for tea producers who do not have the marketing power to source and reach new or potential buyers, to access this buyer through a centralised process that is cost effective to them,” said Mr Mudibo. Kenya’ hosts the world’s biggest...

A total of 286 construction projects were launched in Africa in the first half of this year worth a combined total of $324 billion, according to a new report. The Deloitte African Construction Trends report said each of the projects on which ground was broken up to 1 June was valued at $50m or more. However, the report said the number of projects qualifying for inclusion “fell by 5% year-on-year, while the value of included projects decreased by 14%, due in large part to the headwinds that countries are experiencing on account of a weak global macroeconomic environment and low commodity prices across the board”. In a preface to the report, Deloitte Africa infrastructure and capital projects leader Jean-Pierre Labuschagne said: “Africa has seen a downturn in both the number and value of projects included this year, in contrast to previous years... many governments and the low number of projects highlighted that the private sector is struggling to maintain their spending on infrastructure and capital projects.” “New pressure or factors such as drought, security concerns and rapid urbanisation coupled with falling government revenues is making it difficult to maintain the spending in infrastructure required by many countries,” Labuschagne said. To qualify for inclusion in its 2016 report, Deloitte said infrastructure construction projects had to be valued at over $50m and must have broken ground, but not yet been commissioned, as of 1 June. In regional terms, West Africa had the most number of projects (92) this year, which amounted to...

Twenty officers drawn from the Customs Division of the Tanzania Revenue Authority (TRA) and the Tanzania Port Authority (TPA) are undergoing a five-day Tanzania- China supported training in a bid to tighten port security. The five-day programme is meant to sharpen their understandings and capacity to handle container scanners currently installed at the Dar es Salaam port. A statement issued by TPA said that the officers taking part in the training in sharpening their knowledge and skills come from Dar es Salaam and Tanga. "I praise the governments of China and Tanzania for embarking on this programme. We expect this training will increase capacity to the custom officers to undertake their duties more efficiently and thus increase revenue collections," TPA Director General Kakoko said. He said the trainees would also be able to verify details contained in the container and relate with the Bill of Lading documents. He said it was vital for the officers to verify government trophies, illegal arms, illicit drugs, and other products prohibited to be shipped through the ports.  He, however, challenged the officers to also take part in the repair of facilities by at least 50 per cent in case of they don't function. The training is being conducted by Nuctech Limited engineers. The company had already installed the scanners at Tanga and Dar es Salaam ports. Project Manager Zhang Sheng said the project was complete and currently they were undertaking training on how to operate the new scanners to allow the facility to be operated...

US $65 million invested in the six year programme that kicked off in 2010 Interventions have contributed to reducing the cost of transporting containers from Mombasa to Kigali from $6500 in 2011 to $4800 in 2016 saving the country approximately $7 million Interventions have had a net return of $100Million. Rwanda ranking in trading across borders improved 44 places (from 131 to 87) contributed mostly by investments made by TMA that have reduced time it takes to export and import and exit borders. Kigali, November 21, 2016: The cost and time of doing business in Rwanda has reduced significantly as a result of elimination of Non-Tariff Barriers (NTB’s), automation of key trading processes, improvement in standards testing and capacity building to build export capability, says a TradeMark Africa (TMA) 2016 Independent Evaluation report. The report by consulting firm MarketShare says the organisation is on track to achieve its target of reducing by 15% the time it takes to transit a cargo container through East Africa’s main transport corridors. TMA made the announcement while launching the report in Kigali in the presence of Minister of Finance and Economic Planning, Hon. Ambassador Claver Gatete. The interventions funded by TMA between 2010 and 2016 at a cost of $65 million and implemented in partnership with the Government of Rwanda (GOR) have contributed to a reduction in cost for transporting containers from Mombasa to Kigali from $6500 in 2011 to $4800 in 2016 saving the country approximately $7 million. A return on investment assessment...