The announcement that Uganda will build its crude pipeline to Tanga in Tanzania rather than through Kenya has muddied the perception that the latter is the economic hub of the region. Tanzania's energetic new President John Magufuli and stellar growth rates make it an ever more attractive prospect for moving goods and basing operations than Kenya, which can present a complex and frustrating operating environment. The Lamu Port and Southern Sudan-Ethiopia Transport Corridor (Lapsset) presents an incredible opportunity for Kenya -- a chance to reaffirm its political and economic strategic importance to the region and the continent. Furthermore, it can add a new pillar to a lopsided economy and reverse the marginalisation that has fuelled poverty and insecurity in northern Kenya. The Hoima-Tanga pipeline decision should be a clarion call for Kenya's policy makers that it is time to get serious about Lapsset. For over a century, the focus and bedrock of the Kenyan economy has been the Northern Corridor -- the belt of infrastructure and economic activity stretching from Mombasa through Nairobi to Kisumu and onto the wider region. This has effectively put all of Kenya's economic eggs in one basket and the rest of the country, particularly northern Kenya, has suffered for it. By shifting its focus to Lapsset, the government's development drive will move decisively to reverse decades of marginalisation and this will have a bevy of benefits. First, it will provide much needed employment and development to a region stretching from Kenya's northern borders to its...

The Malaba-Kampala section of the standard gauge railway will take a while longer to be completed after China’s Export Import Bank set new loan preconditions for Uganda. A document prepared by officials from Uganda’s Ministry of Finance, Planning and Economic Development and seen by this paper shows that a key demand by the Chinese is that Uganda secure guarantees from Kenya that it is still interested in and will source financing for the Naivasha-Malaba section of the standard gauge railway (SGR). It also wants guarantees on compensation for those people affected by the project and a new feasibility and bankability study showing that construction of the SGR makes business sense. Kampala has now been forced to revise the completion date for the construction of the SGR from the Northern Corridor’s target of March 2018, to sometime around 2020, The EastAfrican has learnt. While the Ugandan government attributes the potential delay to China’s desire to take on a bigger portion of the financing responsibility in the wake of the agreement that the lender will run operations for 10 years in order to recoup its investment, sources say Beijing is concerned about Uganda’s ability to meet its repayment obligations. Minister of Works and Transport John Byabagambi confirmed in an interview in Kampala that there will be delays, setting the new expected date of completion of only the Malaba-Kampala section to 2020. The target set by the Presidents of Rwanda, Kenya and Uganda was for the first train to be flagged off from...

Kenya and Tanzania are each building new oil terminals to increase efficiency in the delivery of fuel for domestic use and also capture the lucrative market in the neighbouring landlocked countries of Uganda, Rwanda and Burundi. The race to lock in the landlocked markets has seen the Tanzania Ports Authority (TPA) seek investors to develop a new terminal with a bigger capacity at Kigamboni to replace the old Kurasini oil jetty in Dar es Salaam, which is a continuation of the first phase of a project that entailed replacement of the single point mooring buoy (SPM) system at Kurasini. Leighton Offshore Pte Ltd of Singapore completed building $66.48 million SPM at Kuraisini Oil Jetty (KOJ) to receive tankers of up to 150,000 metric tonnes in November 2012. The facility previously handled tankers ferrying a maximum of 40,000 tonnes of fuel, leading to congestion. Tanzania Italian Petroleum Reserves Ltd (Tiper) expects to double its storage from 141,000 to 213,200 cubic metres in Dar es Salaam after completing the refurbishment of two tanks at a cost of $11 million. “The new pipe connection will also increase efficiency in receiving diesel from the SPM with the current flow rate of 1,500 cubic metres per hour rising to 2,000 cubic metres,’’ said Tiper managing director Daniel Belair. The firm plans to build new 100,000 cubic metres tanks to increase storage to 313,200 cubic metres. Tiper will also invest between $12 million and $16 million in new pipelines to deliver more fuel from Kigamboni to...

The East African Community has unveiled its budget with a 20.2 per cent reduction in donor dependency and 8.4 per cent cut in spending. In the $101.4 million budget estimates for the 2016/17 fiscal year, the bloc reduced expenditure by $9.3 million and slashed the donor aid target by $11.8 million. The budget for the year ending June 30, 2016 was $110.7 million. EAC Secretary-General Liberat Mfumukeko termed it the most efficient budget, reflecting the austerity measures ordered by the EAC Heads of State. But critics termed the cuts contradictory in the face of expanding regional programmes among the six member countries. “The EAC membership has expanded, meaning more expenditure in executing programmes and projects, but the budget reflects a sharp slash,” said East African Legislative Assembly member Abdullah Mwinyi of Tanzania. South Sudan was admitted into the EAC by the 17th EAC Summit and the signing of the Treaty of Accession on April 15. Juba is expected to submit the instruments of ratification to the Secretary General before the end of the year. The Secretariat has been tasked with putting in place mechanisms that will facilitate the follow-up on the ratification by South Sudan, and develop a roadmap for the subsequent processes that are required to integrate Juba fully into the EAC’s programmes, projects and processes. All these processes, understandably, will result in an increase in expenditure. Tabling the budget, Tanzania’s deputy Minister for Foreign Affairs and East African Co-operation Susan Kolimba said input from development partners would drop...

Our continent is undergoing an unprecedented and rapid transformation. Some of the world’s fastest growing economies are in Africa. Our cities and our populations are exploding. The “wild” side of Africa is changing as new infrastructure to accommodate this boon, as well as increased regional and global trade, are transforming urban and rural areas. In this, many are writing the first chapters of Africa’s rise. But are we seeing the full story? Climate change, population growth, increased water demand and environmental degradation are all putting pressure on our freshwater resources. In a number of African countries, demand for water outstrips available resources. More than half of Africa’s population still relies on forests for their livelihood yet the continent lost 3.4 million hectares of forest per year between 2000 and 2010 to human activities. For wildlife, the future doesn’t look much brighter. As trade routes between Africa and other parts of the world open and multiply, so do the opportunities for smuggling of our natural heritage. Each year, more than 20,000 elephants are killed by poachers for their tusks, and more than 1,300 rhinos were poached in 2015 in Africa. ENVIRONMENTAL IMPORTANCE And while Africa’s “lion economies” continue to grow, Africa's lions are in a state of serious decline. Clearly we are not undertaking a complete environmental accounting of our success. Last week, Nairobi hosted the second session of the United Nations Environment Assembly, the world’s highest-level governing body on the environment. Protecting the environment is not merely about saving elephants...

The construction of Sh420 billion standard gauge railway will be completed before its scheduled completion date, President Uhuru Kenyatta was told during his inspection tour of the project on Saturday. The SGR project was set for completion in March 2018, but contractors say with more than 75 per cent of the work on the 235km track on the first phase between Voi and Sultan Hamud complete, they are ahead of schedule. The President visited section seven 7 of the project at Sultan Hamud, where he was told more than three-quarters of the civil works has been done. Uhuru said the government is in talks with investors to put up industrial parks along the SGR line to create jobs. “We have discussed how to set up industrial parks at Dongo Kundu in Mombasa, Voi, Mtito Andei, Nairobi and Naivasha, which will create jobs for youth,” he said. “Financing has been identified and construction is expected to start in September.” The main SGR contractor, the China Road and Bridge Corporation, has set up small construction camps on the route to ensure smooth and efficient operations. Uhuru was told local suppliers pocketed Sh50 billion injected into the economy by the railway project by February. The President has directed 40 per cent of supplies of goods and services to the SGR project be outsourced locally. The project has employed more than 30,000 residents, fulfilling one of the major demands that jobs be handed to local communities during the construction of the biggest investment in...

The decision by Uganda and Rwanda to ditch Kenya’s proposed oil pipeline in favour of Tanzania’s should ring alarm bells in terms of what this means, not just for the economy but for the viability of the standard gauge railway that is being touted by the government as a game changer. It may soon dawn on us that not only was the SGR a very bad idea, but that it will put the country in such serious debt that Kenya could soon be rushing to the International Monetary Fund for a bailout loan. Already the IMF has warned Kenya that the country’s debt burden and the huge loans from China can bring the country’s debt to unsustainable levels. By arrogantly excluding Tanzania from discussions and assuming that it could play big brother to its neighbours, Kenya shot itself in the foot and lost the goodwill that it took for granted. Kampala and Kigali probably realised that Kenyans had been taken for a ride and, therefore, put their heads together and decided that rather than rely on Kenya for its transport needs, it should turn to Magufuli’s Tanzania. At least Tanzania does not have the perennial conflicts that Kenya seems to have every election cycle and with less corruption, Ugandan and Rwandan goods will probably be safer and cheaper to export and import from there. The question we must ask now is whether the Chinese hoodwinked us into undertaking the SGR project knowing full well that it was not viable. A...

Kigali. Until 2001, Rwanda was a net importer of wheat flour and it largely depended on Tanzania’s millers. That was the situation that President Paul Kagame found when he took office in 2000. President Kagame embarked on the task of searching for credible investors who would relieve the country out of that mess. Between then and 2010, Rwandan government officials held discussions with several investors from within the East African Community (EAC) region and beyond. In its marketing approach, Rwanda issued several incentives to investors in that particular field. In 2006, a team of government officials from Rwanda held discussions with Tanzanian investors who operate the Dar es Salaam-based Mikoani Traders Ltd - the producer of several products under the Azania brand name. “That was how the decision to build this state-of-the-art wheat flour mill here was reached upon….after analyzing the incentives, the investor saw it was worth it,” the Mikoani Traders Ltd country manager for Rwanda, Mr Jerome Mpagaze, told participants in the recent Tanzania-Rwanda Trade Forum in Kigali. The company has injected a total of $10 million into the milling plant that grinds 150 metric tonnes of wheat per day, complete with a storage facility that has a capacity of loading 10,000 tonnes of the products at any given time. True to its promises, the Rwandan Government gave the company- located at the Special Economic Zone in Kigali – everything that would be required for it to operate efficiently. “Everything was concluded swiftly…..the government provided us with space...

ADDIS ABABA (Xinhua) -- A senior official of the African Union (AU) has underlined the need for AU member states to act quickly to move forward the agenda of realizing continental free trade (CFTA) in Africa. Fatima Haram Acyl, AU Commissioner for Trade and Industry, made the remark on Monday during the opening of the First Ministerial Meeting of the Specialized Technical Committee on Trade, Industry and Minerals at the headquarters of the pan-African bloc in Ethiopia’s capital Addis Ababa. The two-day meeting, which was preceded by session of experts, has been organized under the theme, “Promoting regional integration through trade and inclusive and sustainable industrial development in Africa.” Recalling that the AU summit in June 2015 launched the CFTA negotiations in commitment to the realization of CFTA by 2017, the AU Commissioner called for speedy action to ensure the ambitious agenda of the continent on CFTA. “We have an ambitious agenda before us. It is therefore incumbent on us to ensure the effective delivery of this target. We should therefore be prepared to provide the necessary guidance bearing in mind the overall goal of One Africa, One Market, in line with the aim and objectives of the Abuja Treaty,” she said. “As a result of the foregoing, we can agree that it’s time for us to act and act quickly. It’s time to move forward our Agenda,” she added. In his statement made through a representative, Abdalla Hamdok, Deputy Executive Secretary of the UN Economic Commission for Africa (ECA),...

TDB acting registrar Nelson Kilongozi, said removal of the tariff barriers would expand Tanzania’s dairy products market in the other EAC members of Uganda, Kenya, Rwanda, Burundi and South Sudan. Speaking at a seminar for building capacity to small holder dairy farmers in Dar es Salaam, Kilongozi admitted that Tanzania’s dairy sector has been grappling with limited market since it could not sell beyond the country’s borders. “In fact we feel that these tariff barriers are unnecessary, we want our colleagues in the EAC member states to remove them,” he said. Currently, Tanzania produces 2.4 billion litres of milk annually out of which 30 per cent is produced by dairy cows and the remaining 70 per cent comes from traditional free range cattle. Philip Emmanuel, a senior official with the Department of Agriculture, Irrigation and Cooperatives encouraged dairy farmers to form cooperatives to improve their economic status. Meanwhile, the government has said that it was planning to spend 94 per cent of the energy and minerals’ budget for implementation of development projects in the coming financial year that starts on July 1. Sospeter Muhongo, the Minister for Energy and Minerals, told Parliament in Dodoma that most of the ministry’s budget for 2016/17 amounting to US$561 million will be used to implement energy projects in the country. He said the energy projects to be implemented in the new financial year were aimed at improving electricity production, supply and transportation across the country, the second largest economy in East Africa. Muhongo said...