Dr Magufuli, who doubles as the chairman of the regional economic grouping, mentioned some of the most persistent challenges as access to clean and safe water, improving transport infrastructures, strengthening health services and build industries that would lead to increase of employment and revenues. He noted this in a conversation with the EAC Secretary General, Ambassador Liberat Mfumukeko, at the State House in Dar es Salaam. “It would be more beneficial if you executives of the EAC make big efforts to ensure that member countries focus on addressing problems facing the people,” he said, adding: “if you manage to do this and work on reducing unnecessary expenditure, we will achieve more.” He commended Ambassador Mfumukeko, who took over the position last April, for coming up with good plans and strategies towards implementing the community’s objectives, including reducing expenditures, attract investors and closely supervise projects and programmes under the bloc. Mr Mfumukeko expressed satisfaction on the cooperation he receives from Dr Magufuli as EAC chairman and promised to perform his duties accordingly for the benefit of East Africans. Meanwhile, President Magufuli said goodbye to former Country Representative of the United Nations Population Fund (UNPF), Dr Natalia Kanem, who has recently been appointed to the post of Deputy Secretary General and Deputy Executive Director of the organisation. Dr Magufuli commended Dr Kanem for being appointed to the new position, saying he was optimistic that she is going to be a good ambassador for Tanzania, particularly on influencing the United Nations to help...

Ugandan President Yoweri Museveni has urged the European Union (EU) to remove subsidies on agriculture inputs to its member states if the East African Community is to benefit from its market. "Africa will benefit much more if subsidies on agriculture inputs are removed to have a break through on agro-processed products' exports," Museveni said, according to a State House statement issued late on Wednesday. Museveni, who was meeting the Speaker of the East African Legislative Assembly Dan Kidega, said the East African region should also cut the costs of production in order to regulate prices of products from both areas. He urged the region to focus on products with value addition like textiles, leather, milk, wood, cooking oil products and processed coffee. The EU has an agreement with African countries whereby they can export their products to the EU market tariff and quota free. Some African countries have however argued that the agricultural subsidies EU gives to its member countries render African products non-competitive because of the high costs of production. Source: ShanghaiDaily.com

Presidents of East African Community partner states recently announced they were banning imports of used clothes, locally known as caguwa. They gave sound economic reasons for the ban: promoting the local textile industry and other economic activities linked to it, creating jobs, raising taxes, and so on. There was even an appeal to a sense of pride. Wearing clothes someone else has discarded (in Rwanda that is called gukuburirwa) is not exactly dignified. No one goes around proudly showing off such clothes (ibikuburano). Despite these good reasons, the decision was bound to be contentious. And it was, by East Africans. Importers and wholesalers, big retailers in the towns and smaller ones in the village markets for whom it is good business wouldn’t let go without at least making some noise. Ordinary people also find second-hand clothes very affordable. That was to be expected and is understandable. Which is why East African leaders announced a phase-out period for the ban to be fully implemented. But now stiffer opposition to the ban on used clothes has come from an unlikely quarter – or maybe it is not so unlikely – the United States. Uganda’s Daily Monitor newspaper reported Wednesday, August 17 that the US Ambassador to Uganda warned the country against implementing the ban. Amb. Deborah Malac is reported to have issued the warning when she made a courtesy call on the Speaker of Uganda’s parliament, Rebecca Kadaga. Don’t be fooled by nice diplomatic words like “courtesy call”. They do not always...

Rwandan importers and exporters will no longer need to travel to Dar es Salaam port, thanks to a move by the Tanzania Ports Authority (TPA) to open a liaison office in Kigali in October. The decision was announced by the TPA Director General, Eng Deusdedit Kakoko, during a press conference over the weekend in Kigali. The press conference was also attended by the Treasury Registrar, Mr Lawrence Mafuru who headed the Tanzania delegation to Rwanda. "This is a clear testimony that Tanzania is committed to improve business environment to our clients in the neighbouring countries," Eng Kakoko told journalists, adding that TPA has vowed to make sure that Kigali exporters and importers using Dar port will continue to enjoy best possible services. He noted that having a TPA liaison office means that services shall be brought near to customers in order to cut down costs of doing business and reduce hurdles within the logistic and supply chain. The opening of the office means that business community will not be obliged to travel all the way to Dar es Salaam to clear their cargo; a step seen as healthy since it will help serve time. The liaison office will be a One Stop Centre whereby customers will be able to access information such as status of their cargo, applicable port charges, make payments through Electronic Payment System (EPS) and attend to any queries. "We call upon all our customers to make effective use of this office once opened and take advantage...

Trade relations between the East African countries of Burundi and Rwanda have worsened following a ban of food exports to Rwanda that Burundian exporters fear will affect their ability to repay their loans. The government of Burundi banned food exports destined to Rwanda at the end of July, later restricting transportation links between the two countries to help enforce the ban. Since then, prices have fallen so much that exporters are reportedly concerned about their livelihood. The government justified the ban saying they aim to save food for national consumption in case of famine, but the local press has reported that the move is aimed at hurting Rwanda, with second vice-president Joseph Butore reportedly stating: “We can’t give the fruit of our labour to Rwanda because they want to fight us.” On his part, Rwanda’s minister for trade and industry Francois Kanimba stated at a press conference that the decision would not in any way affect Rwanda’s economy, but that it impacted badly on the East African Community (EAC), of which both Burundi and Rwanda are members. “This is a very serious breach of EAC free trade regime,” he said. The speaker of the East African Legislative Assembly (EALA), Daniel Kidega agreed with the Rwandan minister. “What Burundi is doing is a serious breach of EAC trade agreement and EALA is going to investigate the matter and find an immediate solution. The region is not happy at all. This hinders the regional integration process,” he said to local press. Relations...

The East African Community has, over the past decade, been undergoing an integration process to open up opportunities for its over 146 million citizens by creating a larger market for business players in the region. The initiative also seeks to reduce the cost of trade and improving intra-regional trade that is still low compared to other trading blocs across the world. These efforts have already started to bear fruit with a recent World Bank report, “Connecting to Compete 2016: Trade Logistics in the Global Economy” showing that the bloc had registered improvement in the movement of goods across borders. The survey ranked trade logistics performance of 160 countries globally. Interestingly, administrative as well as trade and transport reforms in the EAC region have had the greatest impact on logistics compared to infrastructure investments. This has translated into faster transit times and shorter dwell times, according to the report. It indicates that the average dwell time at Mombasa port reduced from 13 days in 2006 to about three days, while the Malaba border crossing point between Kenya and Uganda registered a decrease in border clearance times from 24 hours to six hours. The average time taken to move cargo from Mombasa to Kampala dropped to three days from 18 days, while Mombasa to Kigali now takes about six days compared to 21 days previously. All these developments have helped reduce the cost of doing business by 50 per cent. So, it is crucial that while regional governments promote hard infrastructure development,...

Efforts to advance the East African Community have often veered between halfhearted and impractical. The regional grouping must adapt – via strong yet achievable economic steps – in order to progress. For some, the 1977 dissolution of the East African Community (EAC) finally marked the forlorn end of Africa’s decades-long flirtation with Pan-Africanism. For others, it represented the triumph of sovereignty and nationalism over unrealistic infatuations with asymmetric economic marriages. The last fifteen years of the organization’s newest iteration have fallen somewhere in between the two – with ambitious pronouncements foreshadowing economic and even political integration coexisting withregional rivalries that have threatened to scupper the entire project. However, what is most needed is not wasted political capital nor governments looking inward, but a balanced solution: concrete steps to solidify the existing union and increase free flows of capital and labor, while giving each of the EAC’s member states the ability to craft domestic policies to suit their own domestic environments. How to achieve this? First, focus on improving the EAC’s economic mainstay – the customs union that binds together Tanzania, Kenya, Uganda, Rwanda, Burundi, and, very soon, South Sudan. It all starts with the Customs Union Since 2005, EAC member states have been able to trade goods and some services with each other free of tariffs, in most cases. They have also synchronized and often reduced most of their external tariffs, reducing the transaction costs of international trade for foreign exporters and reducing the likelihood of one East African state...

By Anitha Kirezi East African exchanges should fast-track integration initiatives like the capital markets infrastructure (CMI) project, and create a pool of skilled personnel. This is essential to position the regional stock market as a platform of choice for raising long-term funding for governments and business community, Celestin Rwabukumba, the East African Securities Exchange Association (EASEA) chairman, has said. Speaking at the 27th consultative meeting in Dar es Salaam recently, Rwabukumba said the CMI project that is nearing completion presents new possibilities for investors seeking cross-border trade opportunities. With capital markets across the world becoming increasingly automated and integrated, regional stock exchanges require a modern system that meets different market needs. This will also make it possible for EAC capital markets to attract global capital flows and participate in international capital markets. Meanwhile, EASEA has agreed to increase product offerings at each stock market, train market intermediaries, carry out public awareness drives and support integration of market infrastructure as they plan to draft a five-year strategic plan. According to a statement from the EASEA secretariat, these initiatives are aimed at increasing market liquidity and depth. Rwabukumba, who is also the Rwanda Stock Exchange (RSE) chief executive, has commended the Securities Industry Training Institute - East Africa, noting that the institute will help market players improve skills and technical capacity to meet global standards. "The institute is at the forefront of driving capital market training to meet the growing demand for relevant expertise in the market," he added during the summit...

IN SUMMARY New system to enable customs department fast-track process The cost of importation is likely to dip substantially as the Kenya Revenue Authority (KRA) moves to handle up to 70 per cent of cargo under a new pre-arrival cargo clearance scheme. A key benefit of the system is that it will spare importers storage charges both at the Port of entry and Container Freight Stations(CFSs). Julius Musyoki, commissioner of customs and border control at KRA, said the new system would enable the customs department speed up cargo clearance, with the slow exercise often attributed to inspection at the port of Mombasa. “Once the system is fully operational we hope to have 70 per cent of pre-arrival clearance of the total cargo coming through the port,” he said. Besides presenting their cargo to inspection companies appointed by the government, exporters will also be required to present invoices for the cargo to the inspection firm for confirmation of value. Once the certificate of conformity is issued by the inspecting firm the carrier is required to present it at the port of export before the cargo is loaded. KRA will then be able to access the data base of the pre-shipment companies through the Kenya Bureau of Standards. “When we do this we expect the rest of the people who remain non-compliant to be subjected to vetting and other interventions. It will be non-discriminative and wholly dependent on the importers’ track record and whether they have a history of non-compliance,” he said....

IN SUMMARY Officials have said they are ready to roll out their plan, which involves moving crude oil by trucks, train and pipeline, having tested it under every conceivable economic model. The Cabinet approved the early crude export plan last week, raising fresh queries over the commercial viability of setting up logistical assets worth over Sh200 billion before exploration firms discover new reserves. No investor has so far expressed interest in the pipeline venture publicly despite Kenya’s preference to have the infrastructure built through a public-private partnership. Under the export plan approved last week by the Cabinet, the government will initially move up to 4,000 barrels per day via trucks to Eldoret and by train to Mombasa port. The Energy ministry has brushed off doubts over its early crude oil export plan despite growing concern that the high cost of logistics involved could erase envisaged economic gains. Officials have said they are ready to roll out their plan, which involves moving crude oil by trucks, train and pipeline, having tested it under every conceivable economic model. “We are not trying anything new here but a model that has worked in other economies,” Petroleum PS Andrew Kamau told the Business Daily. The Cabinet approved the early crude export plan last week, raising fresh queries over the commercial viability of setting up logistical assets worth over Sh200 billion before exploration firms discover new reserves. Kenya has recently adjusted its officially confirmed crude oil reserve from 600 million to 750 million barrels. To...