Kinshasa in the Democratic Republic of the Congo is a new destination for Nairobi financiers and die-hard merchants. If all goes well, this fledgling relationship could be a catalyst for Central Africa’s digital transformation and a significant boon for the East African tech market. The Democratic Republic of the Congo (DRC) has only joined the East African Community (EAC) for just four months, but even before joining the EAC there were economic ties that made it possible. rice field. The border towns of Goma and Bukavu are active market places where merchants from the Democratic Republic of the Congo, Uganda, Burundi and Rwanda exchange consumer goods. There are also a number of artisanal mines staffed by miners from neighboring countries and the Democratic Republic of the Congo. In addition to petty cross-border trade, the DRC’s rich mineral resources have also attracted the attention of neighboring countries. Some of that attention has been covertly or overtly violent, helping the DRC fight rebel groups in several parts of the country. The resulting instability has turned the Democratic Republic of the Congo into a boxing ring of neighboring countries vying to defend their interests on Congolese lands. With more than $24 trillion of untapped mineral deposits and 90 million inhabitants, the DRC is an attractive market for investors around the world. However, a shift in political winds in 2018 led to the resignation of long-time ruler Joseph Kabila in 2019, and Kenyan merchants, high and low, poured into the DRC. consolidated its position...

AfCFTA testing new tool to measure ease of trade among African countries Early test results indicate major gender parity issues AfCFTA secretariat to seek national policy change to ease cross border trade  So you wish to invest in Africa, with 51 countries to choose from, what factors are going to guide your decision? Once you have overcome that huddle, comes another matter to address and that is ‘how easy is it to do businesses between said African countries?’ The second part of the question is what we will focus on here, how easy is it to do business between and among various African countries.’ There already exist several trading blocs and free trade zones etc and finally the largest of them all the African Continental Free Trade Area (AfCFTA) has finally been passed and is in action. So what does this mean for investors, for businesses seeking to trade between countries? To address this question, the Economic Commission for Africa (ECA) has effectively developed a first of a kind method to measure how easy, or hard, it is to do business between/among African countries. The tool has been christened the AfCFTA Country Business Index (ACBI) and was launched during the 54th session of the Economic Commission for Africa (ECA) Conference of Ministers in Dakar, Senegal in 2018 the tool focuses on African integration. This means that it measures ease of doing business for companies or entities that are first of all located on the continent and secondly, those that operate among several...

African countries have been charged to urgently domesticate the provisions of the African Continental Free Trade Area, (AfCFTA) treaty to fast-track the continent’s economic progress. Secretary-General of the AfCFTA, Wamkele Mene made the call recently in Accra, Ghana at the maiden edition of the Ghana Trade Policy Enlightenment Summit for Foreigners, GaTPES2022. GaTPES2022, which was held under the theme ‘Helping foreign businesses to better navigate the trade policy landscape’, was organised by Ghana’s premier travel company, Standard Travel and Tour, STT. It had the endorsements of the GIPC, RGD, Lands Commission, GRA, FDA, Office of the Speaker of Parliament and the AfCFTA headquarters; and, support from Fine-Prints Limited, Eddu Motors and the Ezeigbo Ghana Foundation, among others Mene urged state-parties to the AfCFTA agreement to use its provision to build their economies and transform lives. “The agreement, which is the treaty, needs to be translated into laws; and those laws are then used by the business person in order to do business, and to put money in the pockets of the business person, and to put money in the economy of the country at large,” Mene stated. Echoing the same sentiment in his address, the speaker of Ghana’s parliament, Mr. Alban Bagbin, assured of legislative support by the parliament of Ghana to make the AfCFTA and the goal of greater intra-African trade a reality. “The AfCFTA has come to stay,” he assured. Mene was represented by Beatrice Chaytor, head of trade in services division at the AfCFTA headquarters; while Bagbin was...

Trade between Commonwealth member states has been growing exponentially, with intra-commonwealth trade expected to surpass $700B in 2022 .The Commonwealth has been a part of the development of AfCFTA since inception, and has remained steadfast in its commitment to work with African countries, in strengthening and deepening their national and institutional capacity, together with developing trade policies over the years. How can member states leverage their commonwealth connections to collaborate and drive sustainable economic growth in Africa? The combined GDP of Commonwealth countries, with a total population of over 2.4B, is now around US$13 trillion Intra-Commonwealth trade expected to surpass $700 billion in 2022 AfCFTA facilitates better access to trade across the continent for all Commonwealth citizens in member states The 2022 Commonwealth Heads of Government Meeting (CHOGM) took place in Kigali, hosted by the President of the Republic of Rwanda, Paul Kagame in late June. Prince Charles, Commonwealth Secretary-General Patricia Scotland, and former UK Prime Minister Boris Johnson were among the dignitaries who attended the meeting. In his remarks, President Kagame noted that the Commonwealth’s objective is to drive inclusive growth and a common future, such that no nation, particularly the small developing countries, is left behind. Baroness Scotland highlighted that her ambition was to facilitate trade within countries. “At the heart of our mission is trade, the lifeblood of economic activity and the arteries of the economic relationships between our Commonwealth member countries. This is the true Commonwealth advantage.” In light of this, she officially launched the Commonwealth Digital Trade...

Digitization of logistics and compliance with sustainability policies will shape the future of logistics in African markets. Digitalization involves the development of digital platforms that match supply to demand, whether it be courier apps that deliver groceries or platforms that coordinate freight delivery. Sustainability significantly overlaps with compliance and regulatory requirements. This means stricter regulations on emissions from logistics vehicles, monitoring of cargo ship pollution, and other issues. The COVID-19 pandemic caused massive damage to global supply chains, with challenges including route congestion and blockages, a global shortage of key logistics components including shipping containers, lack of space in warehouses, a spike in transportation costs, and substantially increased demand for goods around the world, post-lockdown. Supply chain stability is also under question due to increased tensions as the Russian-Ukraine war drags on. According to The Africa Logistics, measures to heal and strengthen ailing chains include digitizing parts of the supply chain, increasing manufacturing capacity in low-cost markets, reducing reliance on single-source suppliers, improving supply chain infrastructure through public and private funding, integrating sustainable practices into supply chain management and carefully monitoring changes in government policy across multiple jurisdictions. While the Logistics market in Africa may be drastically weakened after the global pandemic, many effective treatments for their repair and strengthening are already underway. Thorny challenges reveal immense opportunities. The world is once more looking at Africa as a potential growth market, so we need to be on top of our game. Digitization of logistics and compliance with sustainability policies will shape...

The Mombasa Tea Auction has been fully automated to boost efficiency and transparency. East Africa Tea Trade Association (EATTA), which runs the auction said that the new Integrated Tea Trading System (iTTS) costs Sh230 million. The automation was funded by the Danish International Development Agency (Danida) through Trade Mark East Africa, said EATTA chairman Arthur Sewe. Mr Sewe said automation of the auction will reduce the period in the tea trading cycle as well as direct costs associated with the auction process. The iTTS project automated the manual processes along the tea value chain and stakeholders hope it will enhance tea volumes traded at the auction and productivity. He said iTTS will ensure availability and access to tea trade data in a timely, reliable, accurate and verifiable manner. “When fully implemented, iTTS will significantly reduce the need for physical presence or representation. It will simplify the tea trading process, reducing, among other things, the learning curve for new entrants into the tea sector and streamlining of processes,” Mr Sewe said. He noted that automation will contribute to an increase in the income of farmers even in the event that prices remain constant. Mr Sewe explained that the digital platform will enable tea packers to effectively participate in the auction and enhance the opportunities for marketing and selling value-added teas. KTDA board chairman David Ichoho expressed hope that smallholder farmers will gain following the automation of the auction. [Sammy Omingo, Standard] “iTTS will increase the volumes of tea sold at the auction. Transparency in...

Transporters using the Northern Corridor have been bearing some of the highest costs in the world, reflecting how shortage of arteries is impeding the competitiveness of the East African region to trade. According to a survey carried out by the Shippers Council of East Africa (SCEA) , transport costs in the region are estimated at $1.8 per km per container against international best practices of $1 per km per container. “The most expensive route to transport cargo was Kampala-Mombasa at $2.5 per tonne followed by Mombasa-Kampala at $2.17, Dar es Salaam-Kampala $1.17 and Bujumbura-Dar es Salaam at $1.02 per tonne,” the SCEA Logistics Performance Survey 2021 report says. “The top three least expensive international routes were Dar es Salaam-Bujumbura at $0.02 per tonne, followed by Dar es Salaam-Kigali at $ 0.17 and Nairobi-Dodoma at $0.1 per tonne.” The Northern Corridor road network covers 12,707km (1,323.6km in Kenya; 2,072km in Uganda; 1,039.4 km in Rwanda; 567km in Burundi; 4,162 km in DRC and 3,543km in South Sudan). The port of Mombasa is the key entry and exit point for cargo belonging to a vast hinterland that includes Burundi, DR Congo, Kenya, Rwanda, South Sudan and Uganda. The port also serves Tanzania, Somalia and Ethiopia. High logistics costs The report summarises average transport cost per metric tonne, assuming a payload of 24 metric tonnes per 40-foot container. Speaking at a webinar by the East African Business Council and TradeMark Africa, National Logistics Platform in Uganda chair Merian Sebunya appealed to governments to...

The main focus for the EAC SMC is to ensure that standards are developed for the most traded commodities in the region. Secondly, for products that are thought to gain a market outside the EAC the SMC ensures that these standards too are developed accordingly. The East African Standards Management Committee is responsible for the development of harmonised standards in all the sectors i.e. products and services. The main role of the SMC is to provide support to technical committees in the EAC to have agreement on standards intended for harmonization so that products can easily cross borders within the seven (7) East African Community (EAC) partner states. There are currently 64 Technical Committees in the EAC which are spread across the sectors of engineering, chemical & consumer products, food & agriculture and Management & financial services. The main focus for the EAC SMC is to ensure that standards are developed for the most traded commodities in the region. Secondly, for products that are thought to gain a market outside the EAC the SMC ensures that these standards too are developed accordingly. The good thing with the EAC SMC is that the need for standards is as a result of studies which have been undertaken by the private sector organisations such as the East African Business Council, as well as development partners such as TradeMark Africa (TMA) on cross border trade of products. These studies are instrumental in identifying standards that need to be developed. It is therefore not by...

Competition between old and upcoming ports on the eastern African coast could signal better alternatives for importers who have struggled with inefficiency. A new report by logistics consultancy firm GBS Africa says that while veterans at the job such as the Port of Mombasa in Kenya and Dar es Salaam in Tanzania could face rough challenges from newcomers, it could be good news for importers as they may be spoiled for choices. The report is based on a survey on investments in ports in the region. It found that the planned new deep harbour facility at Bagamoyo in Tanzania and Lamu in Kenya offer importers and exporters alternatives. Bagamoyo is seen as the biggest game changer in Tanzania and the immediate challenge to Mombasa. In fact, new investments in Tanzania and Kenya could inadvertently cause some form of cannibalism, as players are likely to rush to where efficiency is. In Mombasa, the challenge of efficiency has been worsened by traffic snarl-ups on key corridors exiting goods from the port. The report notes that the port of Dar es Salaam offers faster and more cost-effective trade and transport solutions than Mombasa, citing that the port of Dar es Salaam is benefitting from ongoing expansion and investments. The Dar es Salaam port is designed to handle more than 10 million tonnes of cargo annually, where four million tonnes are dry general cargo, six million tonnes of liquid bulk and one million tonnes in the container terminal section. The competition among ports has already...

Kenya has listed 14 merchandise and service sectors for trade under the African Continental Free Trade (AfCFTA), as it becomes among the first six to pilot the continental pact. This comes even as countries continue to push to clear pending issues on preferential Rules of Origin on sensitive goods which account for 7% of the tariff lines. The stalemate is on textile and apparel, sugar and sugar products, goods produced in Special Economic Zones (SEZs), edible oils and motor vehicles. Nevertheless, member states have agreed on 88.7% tariff lines of about 6,000 products, open for trade on preferential terms. Industrialization, Trade and Enterprise Development CS Betty Maina yesterday said Kenya’s prioritised sectors in merchandise trade include agriculture, livestock and fisheries, manufacturing, handicrafts, mining, oil and gas. Priority export sectors under services trade are business including professional services, tourism, education, health, financial services, ICT, cultural and sports services; and transport and logistics. Kenya and Ghana were the first countries to ratify the AfCFTA and to deposit instruments of ratification with the AU Commission, after the agreement was adopted by the AU Extra-Ordinary Summit on March 21, 2018 in Kigali, Rwanda. Despite the launch of the commencement of trade in January 2021, commercially meaningful trade was yet to commence. To date, 54 African Union (AU) member states have signed the AfCFTA agreement with 49 having ratified it, making them eligible to trade. However, only six countries– Ghana, Cameroon, Egypt, Rwanda, Tanzania and Kenya are leading the pact in the pilot phase, with volumes expected...