Archives: News

East African crude oil pipeline on the cards

Neighbouring east African countries, Tanzania and Uganda have announced that a crude oil pipeline is on the cards with construction planned to commence early next year. According to local media, Uganda's energy minister, Irene Muloni, confirmed the development of a crude oil pipeline following discussions the ministry held on Tuesday with a visiting Tanzanian delegation. Muloni said the two countries had agreed to fast-track the project, which will cover 1,443 kilometres. It is reported that oil explorations have uncovered more than 6.5 billion barrels of crude oil reserves from about 40% of the Albertine basin in western Uganda. Muloni said: “Every activity in respect to the project will be done in a fast tracking mode. We have agreed to meet in Tanga (Tanzania) in October this year to launch the front-end-engineering-design for the project.” The minister revealed that feasibility studies estimate the project to cost $3.55 billion. East African crude oil pipeline According to the media, Muloni said a pipeline company will be set up and Uganda, Tanzania and other interested east African states will have shares in it. “The pipeline is very attractive and viable. Securing financing will be explored in much detail. Contacts are being made to potential funders,” she stated. Both the countries’ leaders are reported to have agreed to name the pipeline project reflecting the East African Community and the second ministerial meeting endorsed, ‘East African Crude Oil Pipeline'. A joint media release, signed by Muloni and her Tanzanian counterpart, Sospeter Muhongo, read: “The ministerial meeting...

East Africa: EU Downplays Tanzania's Decision to Opt Out of EPA

Dar/Arusha — Despite Tanzania's recent decision to pull out of the Economic Partnership Agreement (EPA), the European Union (EU) has said it is forging ahead with plans to sign the deal with the East African Community (EAC). The head of the EU Delegation to Tanzania, Mr Roeland van de Geer, said the decision to sign or not to sign the already negotiated agreement was for the EAC to determine. "The EU is ready to sign the EPA, and it is hoped that the EAC will also be ready to sign in the near future. That decision is for the EAC and its member states to take," Mr van de Geer told The Citizen through email. Tanzania announced last week that it would not sign the EPA during a ceremony scheduled for next week in Nairobi. Tanzania, along with Kenya, Uganda, Rwanda and Burundi, negotiated the trade agreement with EU for more than a decade before a deal was apparently reached. Foreign Affairs Permanent Secretary Aziz Mlima said last Friday, that the decision was not based on Britain's decision to exit the EU, but more specifically on what he described as "national interests." He said the decision was meant to protect Tanzania's nascent industries. Mr van de Geer spoke as the EAC technocrat behind the 14 years of negotiations said he was still optimistic Tanzania would come along. Elsewhere, reports in Kenya said the country's Foreign Affairs minister, Ms Amina Mohammed, was due in the country to hold talks with the...

Rusumo-Kayonza Highway to Be Widened

Construction works are set to begin to widen a strategic busy highway connecting Rwanda to the border with Tanzania. The 92km Rusumo-Kayonza road will from November be rehabilitated and widened to accommodate busy traffic of heavy cargo trucks. For this project, Rwanda has signed $184.1 million (Rwf 137.3 billion) loan agreement with African Development Bank ($94 million), Japan International Cooperation Agency ($68.4 million) and the European Union ($ 21.7 million). This 6metre-wide highway is part of the Central Corridor that leads to Dar-es-Salaam Port-Tanzania. It will be extended to 7 metres wide. “The project will make overland transportation smoother and decrease shipping costs,” said Claver Gatete, Rwanda’s Finance Minister. Before construction starts, Rwanda is set to first expropriate 565000 houses along the highway with total compensation valued at $12.5 million. Rwanda will repay this loan in a period of 40 years with 10 years of grace period and an interest rate of 0.75% on AfDB loan, while JICA will charge 0.01% interest rate. At the signing, Ambassador Negatu Makonnen the AfDB representative to Rwanda said; “this is the biggest project my bank financed since 1974 in Rwanda that will make a huge impact.” Takayuki Miyashita, the Japanese Ambassador to Rwanda said it is their biggest commitment to Rwanda in the last 27 years. “We are determined to contribute to Rwanda’s infrastructure development because the country uses loans efficiently.” The loan is a second commitment by JICA to a mega project that links Rwanda to the central corridor. Early this year,...

Poland on economic mission to east Africa

Radosław Domagalski will lead a delegation of entrepreneurs from an array of sectors, ranging from renewable energy, agriculture and trade. The envoys will also include representatives of the Foreign Affairs and Finance Ministries, alongside the Polish Information and Foreign Investment Agency (PAIiIZ), the National Economy Bank (BGK) and the Polish-Tanzanian parliamentary group, Domagalski announced on Wednesday. A series of bilateral talks with representatives of the Tanzanian and Kenyan finance, industry, trade and agriculture ministries are on the agenda. The key topic of the talks are aid credits the Polish government has granted to Kenya and Tanzania. Poland hopes that Polish companies will be able to tap into the resources lent to the two countries, reaching up to USD 110 mln for Kenya and USD 100 for Tanzania. “I hope that with this development aid we will see new Polish investment projects on the African continent,” Domagalski told news agency PAP. The trip coincides with the 14th UN Conference on Trade and Development (UNCTAD), to be held in Nairobi next week. The visit begins on Monday, 18 July, and will last until Friday, 22 July. Trade between Kenya and Poland reached USD 109.8 million in 2015. In the case of Tanzania, last year’s trade figures amounted to USD 69.5 million. Source: Radio Poland

Tanzania's U-turn sparks calls for rethink of EU trade deal

It is imperative for East African Community (EAC) to listen carefully to the issues Tanzania is raising related to the Economic Partnership Agreement (EPA) the bloc concluded with the European Union, a regional lawmaker has said. MP Abubakar Zein Abubakar, a Kenyan representative in the East African Legislative Assembly (EALA), stressed this during an interview with The New Times on Monday. “It is important for us to listen to the issues Tanzania is raising and also look at the implications of Brexit. We, as Africans, cannot afford not to act together as a bloc,” Zein said. “We must always consider working together as a unit and take into consideration whatever unfolding situations.” Tanzania’s foreign affairs permanent secretary Aziz Mlima said his country will not sign the EPA between EAC and EU. Dr Mlima told reporters in Dar-es-Salaam, last week, that Tanzania decided to halt signing because of the “turmoil” that the EU is experiencing following Britain’s exit. “Our experts have established that the way it has been crafted, the EPA will not benefit lead industries in East Africa, but instead to their destruction as developed countries are likely to dominate the market,” said Dr Mlima. Like Mlima, Rwandan economist and EALA member, James Ndahiro, opposes the EPAs on grounds that “it is one-sided” and that EAC economies do not have a competitive edge given their small industrial base. Ndahiro said that, for example, EU countries spend more than Euro 90 billion on direct farm payments (subsidies) and, as such, agricultural products...

Africa tipped on joint infrastructure projects

PREVAILING infrastructure and energy gaps across the continent can be bridged fast if African countries pursued joint projects, the African Union Commissioner for Infrastructure and Energy, Dr Elham Ibrahim, has said. Ibrahim made the remarks while speaking to The New Times on the sidelines of the ongoing 27th African Union summit in Kigali. She noted that with most of the African countries being emerging economies, teaming up for major projects would ease the burden on individual countries as well as improve their chances of securing funding. “This is what can enable us undertake huge projects, as well as alternative projects. It is important to work together since resources in some countries are not adequate enough for large projects. That is why we are devising a strategy of joint infrastructure projects,” Ibrahim said. The continent continues to suffer from inadequate infrastructure such as road network, railway access and pipeline which experts say has slowed integration and limited intra-Africa trade. Ibrahim said regions that had jointly implemented infrastructure projects such as east Africa had experienced rapid growth in recent years and could easily mobilise funding. “If you look at countries in the East African region, they have improved very fast in recent years in terms of infrastructure due to cooperation. This is true in the areas of roads network, railway and pipeline. Cooperation speeds things up and makes it possible to get funding,” she said. By teaming up, the commissioner added, financing, a factor considered “elusive” by most governments implementing infrastructure projects, would...

East Africa: RVR Promises to Change Face of Transport in East Africa

The misleading reporting that has recently appeared in the press regarding Qalaa Holdings and its investment in Rift Valley Railways (RVR) has compelled us to respond to the blatant inaccuracies and to clarify any misunderstanding that may have occurred as a result of these false accusations. We clearly and unequivocally state that Qalaa Holdings is committed to adhering to the highest international business standards and to ensuring the success of the project in question. Furthermore, the company has repeatedly demonstrated that it is a staunch advocate of investing in the region as a whole. Qalaa Holdings was, therefore, deeply dismayed by the story that was reported online by Finance Uncovered and published on June 22nd in The Observer. Since 2011, Qalaa Holdings has proudly overseen the renaissance of a strategic infrastructure asset in East Africa which was previously in a state of disrepair. For the past five years, despite significant challenges, Qalaa Holdings has supported RVR's management and its local partners to implement a comprehensive and complex turnaround program. By assembling and leading a consortium of experienced infrastructure financiers, including the IFC, AfDB, KfW, FMO and BIO, Qalaa Holdings has enabled RVR to achieve the following:- 1. Reduce incidents (calculated by million train kilometers) by 40%; 2. Increase its haulage capacity through the acquisition of 20 locomotives and up to 240 high-capacity wagons; 3. Reduce transit time between Mombasa and Kampala (one way) by 29.8%; 4. Introduce the most advanced train operating technologies; 5. Pay $66 million in concession fees...

African countries urged to unite for preferential trade

African countries should unite and form their own common market to bolster preferential trade required to drive economic growth and development, an official has said. African Union Commission chairperson Nkosazana Dlamini-Zuma said this while officially opening the 32nd Ordinary Session of the AU Permanent Representatives Committee (PRC) in Kigali, Rwanda on Sunday.Dr Dhlamini-Zuma said opening up of markets, liberalization of economies and facilitating free movement of people across the continent were key elements in driving Africa’s economic growth and development. To further Africa’s economic growth and development agenda, the AU is pursuing various initiatives including creating a Continental Free Trade Area (CFTA) to boost intra-African trade. Another initiative is the launch of the AU Passport, a flagship project of Africa’s Agenda 2063 aimed at facilitating free movement of persons, goods and services around the continent -in order to foster intra-Africa trade, integration and socio-economic development. “The world is moving towards mega trading blocks, that all exclude us, and the Doha development round of negotiations have failed to even start. Unless we unite to form our African common market, the little bit of preferential trade we have at the moment, will be further eroded,” said Dhlaminin-Zuma. “If we continue building momentum on the continental free movement of people and on the Continental Free Trade Area it will create better conditions for our traders, farmers, business, entrepreneurs and innovators to invest trade with each other and build Pan African companies and brand.” The PRC meeting kicked off the mid-term African Union summit which...

East Africa: Indian PM Visit to Boost Trade Ties With Tanzania

The Kiswahili proverb 'Mgeni njoo, mwenyeji apone,' which translates to let the guest come so that the host or hostess may benefit, can describe better the one-day state visit of India's Prime Minister, Narendra Modi in Tanzania on Sunday. The Indian leader was on a tour of four countries in Africa to drum up business between India and African countries and tie up energy and trade deals. He had visited Mozambique and South Africa and left for Kenya later on Sunday. He and his host, President John Magufuli signed five agreements, including one to provide credit amounting to 92 million dollars to improve water accessibility on the island of Zanzibar where India will extend a line of credit for the rehabilitation and improvement of the water supply system for the semi-autonomous island. The Indian leader said India would also offer a 500 million Dollars of concessional credit for water supply connections to 17 cities in addition to an existing 100 million Dollars. The two leaders had agreed to deepen diplomatic and economic ties in agriculture, food security, trade, natural gas and other vital sectors. Under food security, India and Tanzania agreed on investments to boost export of pulses to India to help the Asian economic powerhouse to ease the shortage of pulses in the country that has led to a spurt in prices. According to President Magufuli he had asked the Indian leader to invest in motor vehicle and motorcycles assembling plants in Tanzania for India to expand footprint in...

East Africa: This Senseless Violence in South Sudan Must End Now

It is distressing that South Sudan, the world's youngest nation, is staring at a return to full-scale civil war despite efforts by the international community to pacify it after nearly two years of violence. The fighting between soldiers loyal to President Salva Kiir and those allied with Vice President Riek Machar, threatens to escalate and return the nascent republic to another round of violent clashes. After two weeks of tension, direct confrontation between the two forces occurred last Thursday in Juba, the country's capital. With Juba enveloped in senseless violence, the East African region should be ready for any eventuality, given South Sudan culture of solving political differences through the barrel gun. In the past five days alone, the new clashes have claimed the lives of over 300 soldiers, displaced tens of civilians and caused massive destruction. A Chinese peacekeeper is among the victims. The international community, particularly the African Union (AU), cannot simply sit back and watch as violence in South Sudan, one of the East African Community (EAC) member countries, continue to claim lives of innocent civilians. The United Nations, AU and regional bodies must come out forcefully to help quell the spiralling violence and restore peace, unity and sanity in the country. We say so because South Sudan's neighbours have suffered the consequence of instability in that country. This is why they played a key role in negotiating for its independence. Later, they brokered peace when fresh civil war broke out in 2013. Longest civil war South...