Stakeholders trading on cereals in the East African Community region have converged in Kenya for a two day meeting to brainstorm on issues affecting the sector in the wake of acute deficit of the commodity. The meeting that has brought governments officials, farmers and the business community from Kenya, Uganda, Tanzania, Rwanda, Burundi , Botswana, Zambia and DRC are set to propose ways of unlocking the bottlenecks and come up with interventions that will promote seamless grain food trade across the re to spur development. Speaking during the forum ,East African Grain Council (EAGC) Gerald Masila said that trading in the region is mostly informal with approximately two-thirds of food trade done through informal channels. Trade, he further said was not structured with multiple layers of value chain players, which leads to relatively high transaction costs, pricing is also not underpinned by market fundamentals and thus being highly speculative at all levels. “Solutions to local trade will have to look at issues such as regulations, logistics and also scale as this is the only way to bring down cost of trading locally and also get much more from local trade”, Masila said. He noted for example the reason maize importers in Kenya are not able to access white non –GMO maize that would help reduce the cost of “unga’ is  that globally there is more GMO maize produced than the non –GMO. “ The government allowed for duty free importation of maize to bridge the gap and to bring down...

One of the narratives surrounding intra-African trade has been that neighbouring countries barely trade with one another. Yet commerce between Sub-Saharan African countries predates the colonial period, when traders, often belonging to the same ethnic or family group, crossed what are now borders to exchange goods and services. This legacy persists, even though for reasons that vary from trade barriers and regulatory compliance costs to infrastructure and behavioural constraints, most trade between neighbouring African countries is conducted by vulnerable, small, unregistered traders who choose this physically demanding work largely because they lack alternatives. According to the African Development Bank, this informal cross-border trade provides income for about 43 percent of Africa’s population. To discuss intra-African trade, one must consider its informality, the small size of the traders and the important role of women. Take the example of Mozambique and Malawi. An observation of bilateral trade data for the period of 2017-2020 shows that there was little or no trade between the two neighbours for agriculture produce such as sweet potatoes, cassava, groundnuts, cotton seed, tropical fruits and beans. A bus carrying cross-border traders at Mwanza border between Malawi and Mozambique But during the visits to border posts and markets across the Nacala and Beira corridors after the Covid-19 pandemic, we saw a considerable flow of such agricultural goods. This suggests that either officials on the two main trade routes linking the countries were not recording the transactions or that products cross the border in such small parcels that they need...

Wednesday, March 29, 2023: The Council of Ministers of the Common Market for Eastern and Southern Africa (COMESA), East African Community (EAC) and the Southern African Development Community (SADC) have adopted legal instruments to implement the Tripartite Free Trade Agreement (TFTA) once it enters into force. In its 5th meeting conducted virtually today, the Ministers adopted the instruments relating to trade and customs, namely the tripartite agreement on movement of businesspersons, annexes on elimination of import duties, trade remedies, rules of origin, dispute settlement mechanism and the TFTA protocol on competition policy. Further the Council adopted the guidelines, manuals and working procedures developed on rules of origin and technical barriers to trade, which comprise of sanitary and phytosanitary matters and non-tariff barriers. The other set of instruments adopted by the Council relates to road transport. They include Vehicle Load Management Agreement, Multilateral Cross Border Road Transport Agreement, Vehicle Load Management Model Law, Cross Border Road Transport Model Law,  Road Traffic Model Law, Road Traffic and Transport Transgression Model Law,  and Transportation of Dangerous Goods by Road Model Law. In adopting the road transport instruments, the Council applied the principle of variable geometry which allow Member States that are not ready to apply them, to do so when ready. This will provide room for discussions to continue at bilateral level while at the same time allowing those countries that are ready, to proceed with their implementation. With the adoption of these trade and transport facilitation instruments, focus now is on the ratification of...

Complex and stringent rules of origin can prevent businesses from taking advantage of trade preferences, according to a new study by UNCTAD and the Common Market for Eastern and Southern Africa (COMESA) secretariat. Rules of origin are the “passport” for goods, determining whether they can be exempted from taxes or taxed less under a preferential trade arrangement or free trade area (FTA). They can be complex to comply with – especially for products made using materials from different countries through global value chains – and can make it difficult for products to qualify for trade preferences. This complexity can hinder African businesses from benefiting from preferential trade agreements that the continent’s governments have increasingly signed to increase intra-African trade or exports to partners like the European Union (EU). Utilization rates Utilization rates measure the extent to which firms are using FTAs. The study uses rates reported by COMESA countries to examine how effectively firms in those nations are using trade preferences offered by FTAs. “Making utilization rates publicly available will help governments monitor the effectiveness of trade agreements,” says Paul Akiwumi, director of UNCTAD’s division for Africa and least developed countries. “And understanding which trade agreements are working better for African firms will help the continent’s governments improve the outcome of trade negotiations and ensure better trade deals,” he adds. Underutilized potential of free trade agreements The study compares the utilization rates of COMESA members under FTAs with other African countries and preferential agreements with Canada, the EU, Japan and the United...

Nairobi 25th August: Regional trade facilitation organisation TradeMark Africa has this morning signed a new Memorandum of Understanding (MoU) with the Centre for Agricultural and Bioscience International (CABI) to cement collaboration and working together for the organisations to promote to enhance market access for regional produce. The two organisations have collaborated since 2017 to implement various Sanitary and Phyto-Sanitary Measures (SPS) projects across East Africa in, among other areas, conducting studies on SPS Gaps in the region and tools to remedy the situation. At a time when SPS issues are significant non-tariff barriers blocking regional produce from lucrative continental and global markets, TMA and CABI will now jointly support strengthening of national SPS systems, engagement with Regional Economic Communities and support AfCFTA implementation specifically the Protocol on Trade in Goods and Annex 7 on Sanitary and Phytosanitary measures. Speaking during the MOU signing TMA CEO Frank Matsaert highlighted the immense potential the region’s agricultural sector holds, if risks in food safety, plant health and animal health are addressed “We look forward to working together in improving the safety of agricultural goods coming from this continent to the rest of the world to enhance market access. We will also bring our expertise of tapping into ICT to modernize how Standards and SPS licensing and regulation is undertaken for efficiency” On his part CABI Director for General Development Dr Dennis Rangi noted that the two organisations will create great synergies in SPS work which is a key catalyst to trade. “The coming...

Trade by the SA Customs Union (SACU) within the African Continental Free Trade Area (AfCFTA) is expected to start in a few months. Read original article

Summary The EABC Business Barometer is an index that captures the sentiment of the business stakeholders about how they see the business environment within the EAC. Businesses in Burundi, Kenya and Uganda reported reduced cost of doing business during the pandemic. Business captains in the region are optimistic that business in the East African Community bloc will increase by 11 per cent in 2022 and 2023. The East Africa Business Community Barometer on Business and Investment links the slight optimism to perception of business owners on the effectiveness of measures introduced by governments in response to the Covid-19 pandemic. Several states imposed key discretionary actions and policies in 2020 and 2021 to limit the human and economic impact of the pandemic. In Kenya, for instance, a package of tax measures was adopted, including full income tax relief for persons earning below Sh24,000  per month and reduction of the top pay-as you earn rate from 30 to 25 per cent, There was also a reduction of the base corporate income tax rate from 30 to 25 per cent, reduction of the turnover tax rate on small businesses from three to one per cent, and a reduction of the standard VAT rate from 16 to 14 per cent. These conditions, according to business owners, plus other loan flexibility policies, contributed a large extent of the growth. The EABC Business Barometer is an index that captures the sentiment of the business stakeholders about how they see the business environment within the EAC. It shows the...

Summary The two countries will form a committee to identify how to address hitches holding back the growth of the key economic sector summary The two countries will form a committee to identify how to address hitches holding back the growth of the key economic sector Arusha. Tanzania and Kenya have agreed to come closer in the tourism sector. The two countries will form a committee to identify how to address hitches holding back the growth of the key economic sector. The committee will, in turn, suggest ways to ensure the two states and the East African region in general, attracted more tourists. This was agreed during a high-level meeting of ministers/cabinet secretaries responsible for Tourism and senior officials from both sides in Arusha on Friday. The committee of technical experts will prepare a report on how to improve cooperation of the two countries which lead in attracting visitors from abroad. The recommendations would be forwarded to the ministers and be followed by drafting of a Memorandum of Understanding (MoU) on the same. Speaking at the meeting, the minister for Natural Resources and Tourism Damas Ndumbaro said Tanzania was determined to work with its northern neighbour in tourism development. “Once recommendations are made we ministers will meet to agree on the way forward,” he told reporters at the Ngorongoro Tourism Tower. Dr Ndumbaro said tourism was a key sector for the economies of both Tanzania and Kenya despite the outbreak of Covid-19. For Tanzania, the sector contributed 21.5 percent of the...

Kenya and Canada share an identity when it comes to gender equality. They are among the few countries that adopted gender responsive measures in the fight against Covid-19. On one hand, Kenya invested in investigating the cause of rise in teenage pregnancies and sexual and gender-based violence (SGBV) and established a multi-agency team to tackle the problem. Canada on its part, invested $100 million to support indigenous women and children experiencing violence and financed women's shelters, sexual assault centres and other organisations providing SGBV services. As the world shifts focus to redeeming the lost gains and building stronger economies of economically, politically, culturally and socially stable women and girls, we speak with Canadian High Commission to Kenya, Ms Lisa Stadelbauer to pick her mind on the way forward. Studies have shown women-led countries outperformed men's in Covid-19 response, what does this mean? That is interesting and it is a moment in time we need to sit down and think why it is the case. One theory that has been put forward is that men are risk enthusiasts. And so countries that took a more cautious approach tend to have come out of the pandemic a little better. Women also tend to lead from a place of empathy and compassion. They put people first and that seems to be the approach that delivered better outcomes. The other thing about women is "what does it mean for women and girls?" In my own country, we have 10 provinces and three territories, and each has...

26th February, Nairobi - United Kingdom (UK) Trade Envoy to Kenya Theo Clarke has today virtually visited projects funded by UK government in Kenya among them the Integrated Customs Management System (iCMS), Regional Electronic Cargo Tracking System (RECTS) and Regional Electronic Cargo and Driver Tracking System (RECTDS) implemented in partnership with the Kenya Revenue Authority (KRA). Speaking during the virtual visit, attended by senior government officials and officials from TradeMark Africa (TMA), through which these projects were funded, the envoy underscored the special trade relationship between Kenya and the UK. Trade between the two nations was worth Ksh 79 billion in 2019 with the trade balance in favour of Kenya. Main Kenyan exports to the UK in the year were coffee, tea and spices at Ksh 18.6 billion (£121 million), vegetables at Ksh 12.1 billion (£79 million) and live plants mainly flowers at Ksh 8.3 billion (£54 million). The UK market accounted for 43% of total exports from Kenya as well as 9% of her cut flowers. British firms sold East Africa’s leading economy goods worth Ksh 125 billion (£815 million) mainly in machinery, pharmaceuticals, and automobiles. The UK is the largest European foreign investor in Kenya, with more than 100 British firms based in Kenya among them Vodafone, BAT, Diageo, Standard Chartered Bank, GlaxoSmithKline, ACTIS, Unilever and De La Rue. The UK Prime Minister’s Trade Envoy to Kenya, Theo Clarke MP, said: “I am pleased that during the day of my first virtual visit as the Prime Minister’s Trade...