Burundi MPs unanimously voted on Thursday, September 19, 2019, the bill ratifying the Republic of Burundi’s agreement to create the Tripartite Zone of Free Trade Agreement (ZLET) between the Common Market for Eastern and Southern Africa (COMESA), the East African Community (EAC) and the Southern African Development Community (SADC). The Minister of Trade, Industry and Tourism, Jean-Marie Niyokindi, explained the reasons for this free trade area before the MPs. Niyokindi said that this free trade area is aimed at developing and proposes to create inter-regional cooperation between the three regional communities based on three pillars, namely market integration, industrial development, and infrastructure development. This agreement will allow Burundi to have access to the market of the 26 countries of the tripartite region and to have a legal basis for continuing negotiations and seeking funding for projects and tripartite programs of interest, he added. Burundi MPs also analyzed and adopted unanimously the draft law by the Republic of Burundi the amended Article 24, paragraph 2 of the Protocol establishing the Customs Union of the East African Community. This paragraph states that the committee shall be composed of nine qualified and competent members in the areas of trade, customs, and law. The wording of this paragraph establishing the Customs Union of the EAC is such that the Trade Remedies Committee is restricted and closed. In addition, it does not allow a new country that joins this community to be represented in this body. This means, according to Minister Niyokindi, that the Appeals Committee...

Despite the current pessimism surrounding the future of Kenya Airways, the International Air Transport Association forecasts more than double growth for the country’s air transport sector in the next 20 years. According to IATA, the sector will grow by 249 per cent over the period if the current trends are maintained, contributing $11.3 billion annually to Kenya’s GDP and supporting an estimated 859,000 jobs by 2037. BUSY ROUTE The findings were made in the Value of Aviation Report for Kenya that was launched during IATA’s Regional Aviation Forum hosted by Kenya Airways on September 17. The report looked at the total contribution of jobs and spending generated by airlines and their supply chain; trade and tourism flows; investments by users of all airlines serving a particular country as well as the city pair connections that make these flows possible. According to IATA, the air transport sector contributed $3.2 billion to the economy, amounting to 4.6 per cent of the country’s GDP in 2017. Kenya received 4.8 million foreign passengers in 2017, which supported 410,000 jobs. About $0.9 billion was spent directly by passengers, which supported 15,000 jobs. Another $0.6 billion was spent on the industry’s supply chain, supporting 96,000 jobs. Tourists who arrived by air spent $1.6 billion, supporting 257,000 jobs in the hospitality sector. According to the report, Africa remains the biggest source of air passengers to Kenya, contributing 3.1 million passengers or 70 per cent of total visitors in 2017. Europe came next with 585,000 passengers followed by Asia-Pacific 284,000,...

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On July 6-7, 2019 I was in Niamey both for the pre-Summit Business Forum and for the African Union’s Extra-Ordinary Summit to celebrate the first Anniversary of the Signing of the African Continental Free Trade Area (AfCFTA) and launch of its operational phase. What is the outlook for the World’s largest single market? As I write, the AfCFTA process is well on track to be ready for trading in July 2020 as planned and Accra, Ghana has been chosen as a location of the AfCFTA Secretariat. In the 2019 edition of our UNCTAD Economic Development in Africa Report, titled Made in Africa: Rules of Origin for enhanced intra-African trade, we argue that it is Rules of Origin that will make or break the AfCFTA. Essentially, rules of origin are a passport for goods. Rules of Origin are at the cornerstone of what it means for goods to be labelled “Made in Africa”. They are a set of technical requirements that define goods’ eligibility for preferential tariffs on imports in a Free Trade Area. Rules of Origin Rules of origin are situated at the nexus of trade and industrial policy. Make them soft and a Free Trade Zone runs the risk of not spurring the creation of local value. Make them too strong and countries risk being considered too protectionist and firms may find them too difficult to comply with. The complexity and incompatibility of different sets of rules of origin across regional economic communities in Africa is one of the many...

Somaliland is seeking investors to boost trade and ultimately the local economy. The semi-desert territory on the Coast of the Gulf of Aden, declared its independence from Somalia in 1991. It is a main livestock exporter. The World Bank pegs its Gross Domestic Product at $1.9 billion. As at 2017, the population of Somaliland stands at 3.5 million. The country has been working to secure recognition as a sovereign nation by the international community. In recent times, it has opened it doors for investors. Internationally acclaimed logistics company, DP world has pumped over $400 million to support the governments plans for diversification. We hear from my colleague Ronald Kato who spent a few days in Hergeisa and the port of Berbera. Kato speaks to Somaliland’s Finance Minister and Chief Executive of DP World about the company’s ongoing port expansion program. But how does this impact locals? Source: africa news

Free Trade Areas (FTAs) need institutions to oversee, promote and monitor the implementation of obligations by the State Parties. The African Continental Free Trade Agreement (AfCFTA) establishes four key institutions, in addition to various technical bodies that are provided for in the different Protocols. These institutions will be responsible for ensuring that this ambitious undertaking succeeds. The functions of the new AfCFTA institutions include political oversight and policy direction, as well as technical guidance and assistance. This will entail a new challenge for the structures of the African Union (AU); when it moves into the world of international trade regulation and ensuring compliance with multilateral trade rules. (Only five of the 55 AU members do not belong to the World Trade Organization – WTO). The Assembly of the AU is the highest decision-making organ of the AfCFTA and shall provide oversight and strategic guidance on the AfCFTA, including the Action Plan for Boosting Intra-African Trade (BIAT). It also has the exclusive authority to adopt interpretations of this Agreement on the recommendation of the Council of Ministers. The decision to adopt an interpretation shall be taken by consensus.[1] The Council of Ministers (those Ministers of the State Parties responsible for trade) must ensure the effective implementation and enforcement of the Agreement and must take all measures necessary for promoting the AfCFTA objectives. The Council of Ministers shall report to the Assembly through the Executive Council of the AU.[2] The Committee of Senior Trade Officials (consisting of Permanent or Principal Secretaries designated by each State Party) must implement...

Nippon Export and Investment Insurance (Nexi), Japan’s export credit agency, has inked partnership agreements with three international financial institutions to accelerate trade and investment in Africa by Japanese companies. The deals were struck with the Islamic Development Bank (IsDB), Islamic Corporation for the Insurance of Investments and Export Credit (ICIEC) and African Trade Insurance Agency (ATI). These partnerships will lead to the establishment of a “co-operative framework to promote setting up projects” on the continent, Nexi says. Nexi and ATI are also collaborating on the launch of a Japan desk, to be housed by ATI in Nairobi. The desk will provide tailored risk mitigation support to Japanese companies and investors doing business in Africa. A spokesperson for ATI tells GTR that the desk will be headed up by ATI underwriter Annabelle Buzingo, a recent recruit who joined at the start of the year from Export Development Canada. She will be supported in the role by an ATI credit analyst. In a release, Nexi says that it will conduct a trade and investment insurance training programme for staff from each of the three institutions, who will then work as Japan desk officers to create a supportive environment for Japanese companies. “We are very pleased to announce that the Japan desk will be set up in ATI to support African projects so that Japanese companies can obtain easy access to the reliable risk mitigation solution provided by ATI,” says Nexi chairman and CEO Atsuo Kuroda. The African market provides great potential for Japanese companies...

One year ago, at the opening ceremony of the 2018 Beijing Summit of the Forum on China-Africa Cooperation, Chinese President Xi Jinping said Africa's development has great potential and this great continent is full of hope. In the first decade of the 21st century, six of the world's 10 fastest-growing economies were in sub-Saharan Africa. After decades of efforts to catch up, Africa now has a real chance to achieve stable development, accelerate its integration process and raise its international status. STABILIZED POLITICS Between 1896 and 1901, British colonists built a meter gauge railway in Kenya to link the port of Mombasa and Uganda to tighten control of the "British East Africa," a proof of the continent's history of colonial oppression. It was only after the 1960s and 1970s that most African countries emerged from many decades of colonial rule after a long and arduous struggle. Afterwards, however, the dark cloud of colonialism still shadowed the continent with many of these countries plunged into turbulence due to historical issues such as boundary demarcation, tribal and religious conflicts left by Western colonialists. Such factors as the imitation of the western political system, the lack of governance capacity by various African governments, and the intervention and manipulation of foreign forces also fueled the turmoil. Drawing on the bitter history lessons, African countries realized that development could not be achieved without a stable political environment. Since the beginning of the 21st century, African countries have gradually embarked on the road of unity and...

Africa's tripartite free trade area (TFTA) will be operational in early 2020, an official said on Tuesday. Francis Mangeni, director of trade and customs with the Common Market for Eastern and Southern Africa (COMESA) told Xinhua in Nairobi that so far five countries have ratified the TFTA that brings together COMESA, East African Community (EAC) and the Southern African Development Community (SADC) trading blocs. "We expect another 11 countries to ratify the agreement before the end of the year so that the TFTA could be operationalized," Mangeni said on the sidelines of the sixth COMESA annual research forum. The five-day event will bring together policymakers, academia, think tanks, and the private sector from the 21 member states to discuss emerging topical issues in regional integration. Mangeni said that the TFTA will also be a building bloc for the African Continental Free Trade Area. The COMESA official added that East African Customs Union and Southern African Customs Union have already completed negotiations on tariff reductions. He noted that countries that are not members of either EAC or SADC will use the current trade liberalization trade regime of COMESA. Mangeni revealed that the ultimate aim of the TFTA is to reduce gradually the tariffs for all goods traded in the bloc to zero percent. "In the first year of operations countries (are) to fully liberalize trade on 66 percent of all goods and achieve 100 percent in five years," he said. Source: Xinhau

While the African Union (AU) has developed ambitious plans for continental free trade it is becoming clear that free movement of people lags behind. This blog identifies six obstacles that impede progress on free movement for people in Africa and considers the prospects for future development. The AU Summit held in Niger on July 7 2019 witnessed the rapid ratification of the African Continental Free Trade Area (AfCFTA). One of the most rapidly ratified and fastest treaties to enter into effect (it took little more than a year from inception), AfCFTA has now been ratified by 27 African countries, including Egypt, Ethiopia, Kenya, South Africa and Ghana, although Nigeria, Algeria, Tanzania and some others have not yet ratified the agreement. Remarkably, at that Summit the Protocol for a Free Movement of Persons was once again missing from the agenda. Intertwined as they must be if they are to operate effectively, the free trade treaty should have been ratified and implemented hand in hand with arrangements for the free movement of people under the Protocol on Free Movement for Africa, adopted by the AU in January 2018. Unfortunately, only four countries (Madagascar, Niger, Rwanda and Sao Tome & Principe) have signed up to the latter arrangement; none of the bigger countries, such as Algeria, Egypt, Nigeria, South Africa and Ethiopia, have ratified it. According to the African Development Bank’s Africa Visa Openness Report 2018, African citizens need a visa to travel to 51% of other African countries, 24% demand a visa on arrival and only 25% operate...