Seven border posts connecting Kenya and its East African neighbours are now complete increasing trade by 23 per cent within the bloc. Speaking on behalf of EAC chairperson John Magufuli at the third EAC assembly in Dar es Salaam on Tuesday, Tanzania Prime Minister Kassim Majaliwa said seven of the 15 borders earmarked to operate as One Stop Border Posts (OSBP) have transformed trade within the bloc. “Seven are complete and four others are operating as OSBPs using bilateral agreements,” said Mr Majaliwa in a statement, "Trade is now at 23 per cent, over and above intra-African Trade figure of 12 per cent.” Among them are the Rwanda Burundi OSBSP connecting at Gasenyi/Nemba in Rusizi district, three Kenya – Tanzania border posts converging at Lunga Lunga/HoroHoro, Holili/Taveta, Isebania/Sirari. Others are; Uganda - Rwanda border posts converging at Kagitumba/Mirama Hills and Rwanda- Tanzania border posts converging at Rusumo. The facilities worth billions of shillings combined are part of the East Africa Trade and Transportation Facilitation Project. The project aims at modernising and strengthening customs administration and border control agencies in the region to reduce non-tariff costs on trade and smuggling at the border. PHENOMENAL INCREASE Mr Majaliwa stated that already, the current increment in the value of trade adds to the 300 per cent increase from Sh202.5 billion in 2005 to Sh607.5 billion in 2014. Majority of the border posts were completed late last year, in future the bloc is expected to register phenomenal increase in trade. "These numbers coupled with...

The cost and time of clearing with customs have drastically reduced thanks to the Rwanda electronic single window system. A report released by TradeMark Africa last week indicated more reduction in the time it takes to clear with customs at the point of entry and exit for importers and exporters. Overall the electronic window has significantly reduced the direct and indirect time required by clearing agents to obtain cargo documentation. The project was first launched in 2012 with the intent of facilitating trade and enhancing international competitiveness. The time it takes to file and clear goods has been reduced from 14 days in 2012 to less than a day courtesy of the electronic platform. Similarly, obtaining an exemption from Rwanda Development Board (RDB) has been reduced from 4 days to less than an hour. This according to the report has resulted into a reduction in the cost of clearing goods and obtaining exemptions to less than Rwf4000 down from Rwf30, 000 in 2012. However, the report revealed no clear relationship between the reduction of cost and the price of commodities. Funded by Trademark East Africa to a tune of $ 3.3 million, the project has played a critical role in reducing the cost of doing business not only in Rwanda but across the region, Hannington Namara the TMA country director said. Overall, the project has boosted not only efficiency but sustainability of cross border trade in the region, Namara noted. He was speaking during the launch of the Rwanda Electronic...

Damali Ssali, an MBA graduate from France's Grenoble École de Management, has her finger firmly on the pulse of Uganda's entrepreneurial prospects. She has her sights set on starting up her own business in Africa — a venture capital fund supporting Ugandan entrepreneurs. And Uganda is a good place for aspiring entrepreneurs to be. Last year, the Global Entrepreneurship Monitor ranked African nation as the most entrepreneurial country in the world; nearly 30% of the adult population were registered as new business owners. Damali believes that one reason why so many native Ugandans have turned to entrepreneurship is a damaging lack of access to inexpensive trade. Working at Kampala-based TradeMark Africa (TMA), she liaises with both public and private sector organizations to improve an inefficient trade network. The aim: for the region to trade itself out of poverty and unemployment. Previously, Damali worked as a finance manager for UK-based KIDS charity and the Children's Investment Fund Foundation, before relocating to France for her MBA. What are your future plans? I would like to start up a venture capital fund that provides seed capital to Ugandan entrepreneurs who may have innovative business ideas but lack the capital to start or expand. I live in the most entrepreneurial country in the world. So I suppose I'm in the right place! Why has Uganda become such a thriving start-up hub? Aside from the obstacles to inexpensive trade, a long period of economic stability has fostered a positive environment for start-ups. Uganda is a...

A fierce battle, including court cases, had been staged against the deployment of a more effective system that should have gone live early last year. So widespread is the abuse of Simba, the system used in clearing imported cargo, that more than Sh68 billion is now feared to have been stolen by staffers of commercial banks in collusion with KRA officials. “The system currently experiences downtime of 11 hours a week due to outdated hardware and software,” TradeMark Africa (TMA) - a regional not-for-profit firm - said of the Simba system. The firm described the Simba system as having basic modules and another 14 sub-systems interfaced with the core system. “This kind of system architecture means there are multiple points of authentication for users and multiple points of system failure,” TMA added, in a sentiment that has been vindicated following the prosecution of two bankers over a Sh124 million tax evasion scam at the Namanga border. The Namanga crossing point is not nearly Kenya’s busiest customs office considering the volume of trade with Tanzania, as Uganda is a much bigger trading partner. Chris Kiptoo, previously the country manager of the firm, and currently the Trade permanent secretary, said TMA had set aside about Sh1.1 billion to help KRA find a replacement to its faulty revenue collection system. “We at Trademark have partnered with the National Treasury through Kenya Revenue Authority to replace the customs management system with a budget of Sh1.1 billion that we will use to roll out a...

Clearing and forwarding agents have blamed Rwanda Customs for delays in the electronic single window clearance system, saying this has cost them clients. This comes after a report released by TradeMark Africa that said that the system which was introduced in 2012 has reduced clearance time at the Customs from 11 days to 1 day and 10 hours. The agents said that although the upgrade is appreciated some glitches exist which end up delaying the process. Among the issues pointed out is the mode of operation, where RRA has two personnel who operate the system, one clears a container and the other exits it. “We always experience a standstill when one of the RRA staff, either clearing or exiting is not available,” said Iyamuremye Patrick, who works with Safe services agency at Magerwa. He said when volumes increase, the available staff get overwhelmed taking longer to clear the goods, given the fact that there are still heavy physical checks involved in goods clearance. Using the electronic interface, some agents clear goods even before reaching the country of destination, for instance those coming to Rwanda are cleared when still in Tanzania or Uganda, however this is only possible if it’s one type of product in a single container. The majority of clients are small and medium size traders who normally merge funds and put multiple products in one container which slows down the process. Rubangisoni Felix, from Adonai clearance agency said because the electronic single window works in the framework of...

There has been a buzz in East Africa since Tanzania’s President John Magufuli announced on March 2 that he had clinched a deal with Ugandan President Yoweri Museveni for a pipeline transporting crude oil to the port of Tanga. The 1,410-kilometre pipeline, that will connect Uganda’s Albertine basin oil fields to Tanzania’s Indian Ocean coast, is projected to cost $4 billion. There is regional drama here, because Tanzania is seen as having beaten out early favourite Kenya. News reports quoted Kenyan officials saying the Uganda-Tanzania deal wasn’t done yet, and that it was scheduled to hold meetings with Kampala. The pipeline through Kenya would cost slightly more – $4.5 billion. Tullow, which has oil discoveries in Uganda and Kenya, came out in favour of the route through Kenya, saying it offered “obvious economies of scale.” Clearly, there is more than economics at play here. First, though, the pipeline project has to take off, and with oil still hovering just over $30 a barrel, there are those who are sceptical that it will do so any day soon. Matters have not been helped by the fact that Uganda’s violent and shambolic February election has given investors the jitters and it could take a few more months for the dust to settle and the Museveni government to succeed in calming nerves and restoring confidence in the country. That said, from one point of view, there is a not-so-silent race between Kenya and Tanzania for the title of the largest economy in East...

I was delighted to return to warm and beautiful Tanzania, a close ally of the United Kingdom, on March 7-8. The UK-Tanzania partnership is strong. The UK is the largest foreign investor in Tanzania, and the second largest donor. During my visit I saw first-hand how that partnership is making tangible changes to Tanzania’s economy, and to people’s lives. For example, funds provided by UK Export Finance are helping construct the new terminal at Julius Nyerere International Airport; UKAid is helping expand the capacity of Dar es Salaam port; and UK experts are supporting Tanzanian police in tackling the illegal trade in drugs, organised crime and corruption. I also saw how weak infrastructure holds back cities. At one point during my visit, there were torrential rains that resulted in a power blackout and a gridlocked city, delaying essential meetings and the sense of routine business. The infrastructure deficit was visible. I am, therefore, pleased that the Department for International Development (DfID) is supporting a government programme with the World Bank to help make Dar es Salaam more resilient to these extreme weather events. With regard to opening the Dar es Salaam Port, DfID is supporting Trademark East Africa to create more space and make roads more accessible. We are also supporting critical feasibility studies necessary for the government to secure finance through the World Bank to improve the port infrastructure to help the country realise the trade benefits of improved transport corridors and reduced transit time for freight. We want...

Eight firms have been prequalified to bid for the construction of the standard gauge railway to link the port of Dar es Salaam in Tanzania to Rwanda and Burundi as the region seeks to lower transport costs. Details of prequalified firms to finance, design, build and operate the proposed 1,665km long railway are however scanty. The project will cost about $7.6 billion, making it one of the East African Community’s biggest railway project. “I cannot name the firms that have been prequalified. But about 60 per cent are from China,” said Imbuchi Onyango, a technical expert on railways at the East African Community Secretariat. The Dar es Salaam-Isaka-Kigali-Keza-Musongati railway, is a high priority project within the framework of the East African Railway Master Plan. According to the Rwanda Transport Development Authority, at least 172 km of the route will be in Burundi and 123km in Rwanda. There will be 407km of new alignment in Tanzania from Keza to Isaka, and 970km paralleling the existing metre-gauge line between Isaka and Dar es Salaam. Mr Onyango would also not reveal when governments of Rwanda, Tanzania and Burundi are likely to call for the bids, saying the African Development Bank (AfDB), the major financer of the project, has to issue a no-objection note on the prequalified firms. Mr Onyango described the prequalified firms as experienced and financially sound and thus able to deliver the project in time. “The list of prequalified firms has been sent to the African Development Bank for a no-objection...

South Sudan has been experiencing a severe economic meltdown since it devalued its currency last December, in an effort to stabilise the prices of food commodities. Joice Yiki, who sells beans at Juba’s Konyo Konyo main market, is seriously considering closing down her business due to the high dollar exchange rates. She said that mobilising hard currency for imports from Uganda remains a major challenge. “If I exhaust my current stock, I will go home and rest; I have no choice since I purchase the beans from Kampala,” she said. Most of the goods sold in the South Sudan capital are imported from neighbouring Uganda, Kenya and Sudan. A 12kg-bag of beans currently costs SSP450 compared with SSP70 before the local currency took a beating. A 50kg bag of flour now goes for SSP800 compared with SSP75 previously. The official exchange rate then stood at $100 for SSP295, at the Central Bank and $100 for SSP360 at commercial banks. The blackmarket sold $100 for SSP400. After the devaluation things changed drastically. “Imagine! You know what the rate of the dollar against the pound is today? It is hurtful to buy $100 for SSP3,200 at the Central Bank and SSP3,600-SSP4,000 on the blackmarket,” she said. Catholic Bishop Santo Laku Pio said the problem is “the cost of living caused by this erratic exchange rate.” “Everything is going up daily. If the dollar goes up today, you are forced to raise your prices and the cost of food goes up,” he said....

Officials representing the ports of Mombasa and Dar es Salaam were in Washington last week seeking US public and private financing for projects to modernise shipping facilities and improve security at them. Competition between the two largest ports in the East African Community emerged as a subtle sub-text in the Kenyan and Tanzanian presentations at a business briefing sponsored by the US Trade and Development Agency. The two officials’ PowerPoint displays were also noteworthy for what they omitted. Tony Kibwana, principal security officer for the Kenya Ports Authority, said little about the $24 billion planned port project in Lamu dubbed Lamu Port South Sudan Ethiopia Transport (Lapsset) corridor. Ntandu Mathayo Ntandu, planning manager for the Tanzania Ports Authority, made no mention of the $11 billion Bagamoyo Bay project which, if completed, would dwarf both the Dar and Mombasa ports in scope. The two port specialists’ reticence on those projects, both of that have been slow to get off the drawing boards, may have stemmed in part from China’s lead role in financing both Lapsset and Bagamoyo Bay. USTDA, the East African officials’ host, encourages US private companies to become involved with infrastructure projects in developing countries. Mr Kibwana described Mombasa as the biggest port in the region. “We aspire to be one of the leading ports in the world,” he added in his remarks to US business executives and government officials. Mr Ntandu outlined plans to expand capacity at Dar and to develop a new facility at Mwambani Bay to...