The East African Community is divided on whether to sign a key trade agreement with the European Union. ALON MWESIGWA explains how the EU-EAC Economic Partnership Agreement (EPA) would affect the region. It is midday on a Sunday and Tom Sajje organises his fishing net in Kitooro on the shores of Lake Victoria, preparing for the evening's journey to fish. "These days, we struggle to get fish; it is no longer as available as it used to be," Sajje said, referring to the dwindling fish stock in the lake. Sajje, who is clearly using archaic methods, says they have not been helped much to improve their fishing methods and their general well-being. People like Sajje have a special mention in the EU-EAC EPA trade deal. It promises "ensuring preservation and priority of particular needs of the artisanal/subsistence fishery." The EU-EAC-EPA deal would also ensure technology transfer, provide for funds, environmental protection, which would in turn grow fish stock, and elevate people like Sajje, but most importantly improve fish exports. That's not all. Once signed, it will affect everyone - from a management firm at an air-conditioned office in town to a cassava farmer in Moroto. The issue is for better or for worse. The 640-page agreement gives a glimpse of how trade will be like in the next 25 years if it is signed. In its preamble, it promises "to serve as an instrument of development... and facilitate attraction of investment, technology and the creation of employment in the EAC."...

KIGALI, May 24 (Xinhua) -- Experts attending the second high-level East African Manufacturing Business Summit and Exhibition (EAMBS) held in Rwanda's capital city Kigali said Wednesday that innovation is key for the East Africa manufacturing sector to compete globally. "We have to understand that our industries are operating in a global context, in an open globalized market place, and that is not going to change. We have to be innovative and work on our efficiencies. We should be able to produce high quality products that are competitive at international markets," said Ali Mafuruki, board chair of Trade Mark East Africa. He added that regional economies should strategically position themselves in the global business environment through producing locally made products that are price competitive. Rwanda hosts the forum from May 23 to 25, 2017 dubbed "harnessing the Manufacturing Potential for Sustainable Economic Growth". The three-day meeting includes an exhibition where investors, enterprises, researchers and academia will collectively showcase new products and services as well as exhibit the latest advances in manufacturing technology and innovation, particularly those with relevance to Small Medium Enterprises. Lilian Awinja, executive director of East African Business Council (EABC), called for innovative strategies that will raise competitiveness levels and expand the region's manufacturing and export base. "Innovations are now shaping the business environment. We need to add value to products produced in EAC. Our regional industries can now begin to raise manufacturing output and increase its share of global trade and production," she added. Mukhisa Kituyi, secretary-general of...

Regional manufacturers have been urged to embrace electronic trading platforms (e-commerce) to widen their market reach and become more productive and competitive. The experts said embracing such innovations will help reduce the cost of production and enhance the sector profitability. According to Dr Mukhisa Kituyi, the United Nations Conference on Trade and Development (UNCTAD) Secretary-General, e-commerce is an instrumental and innovative tool for promoting industrialisation and trade across the region. Kituyi was speaking during the ongoing EAC Manufacturing Business Summit and Exhibition in Kigali on Tuesday. The three-day summit brought together more than 500 participants,  including business leaders,  experts and policy-makers, to discuss mechanisms to bolster regional industrialisation. Kituyi said manufacturers should take advantage of the immense opportunities presented by e-commerce platforms to enter new markets, create awareness about their products and drive sales to improve profits. The UNCTAD official observed that the economy today is being driven by digitisation, which makes it imperative for regional manufacturers to embrace e-commerce and tap into the untapped markets. This way the sector will be able to create more jobs and foster inclusive economic growth, he added. Matthias Wachter, the in charge of the Federation of German Industries department of security and raw materials, encouraged industrial players to employ technology and e-commerce in all their processes to increase production and tap new customers. “This way, they will be able to easily penetrate markets and sell products at competitive prices,” he added. Reducing cost of production Meanwhile, the business community has called on regional...

Djibouti has formally opened one of four new ports designed to cement the tiny Horn of Africa nation's position as a continental hub, a statement from the ports authority said on Wednesday. Doraleh Multipurpose Port has been substantially upgraded as part of a Chinese-backed plan to establish Africa's largest free-trade zone that can handle $7 billion of goods a year. "The port of Djibouti is a gateway to one of the fastest growing regions of the world with 30,000 ships transiting the port each year," the statement said. "Located on two of the three busiest shipping routes in the world, the port provides a strategic platform for maritime activity connecting Asia, Africa, and Europe." Tiny Djibouti, with a population of 876,000, has long punched above its weight. It hosts large U.S. and French naval bases; China is also building a naval base. Djibouti also handles roughly 95 percent of the inbound trade for neighbouring Ethiopia, population 99 million. Doraleh's bulk terminal can handle 2 million tons of cargo a year, and offers space to store 100,000 tons of fertilizer, 100,000 tons of grain, and warehouses for other goods. The break bulk terminal can handle 6 million tons of cargo annually, the statement said, and there are 40,000 slots for vehicles at the RO-RO terminal. Two other ports designed to export salt and potash will open next month. Djibouti mainly handles goods from Asia, representing nearly 60 percent of traffic, the statement said. In 2015, overall traffic to Djibouti increased 20...

The region's manufacturing sector has huge potential and collective effort will be crucial for countries to exploit it, Prime Minister Anastase Murekezi has said. Murekezi was speaking at the official opening of the second East African Manufacturing and Business Summit in Kigali yesterday. He told regional policymakers, industrialists and other participants attending the summit that the East African Community has set out a target of ensuring that by 2032, the manufacturing sector will contribute 25 per cent to the bloc's GDP. Currently, manufacturing accounts for just 10 per cent of the GDP in the region. Murekezi said it is expected that by 2032 the bloc will have diversified the manufacturing base and raised the value of local content of manufactured exports to at least 40 per cent from the currently estimated value of 8 per cent. Source: All Africa

Regional manufacturers are currently in Kigali to chart ways of revitalising the sector and help increase its contribution to growth and job-creation in particular. The manufacturers, who are attending the second EAC Manufacturing Business Summit, want East African Community governments to put in place sector-supportive policies to drive growth. The East African business community blames the minimal contribution of 10 per cent to the bloc’s GDP on the lack of supportive policies and deliberate reforms to spur the sector’s growth. Other challenges such as high power tariffs, poor roads and high cost of air transport also need to be addressed by EAC partner states for the bloc to register meaningful growth, create more jobs for the youth and reduce its dependence on imports that erode foreign exchange reserves. In addition, the call by the East African Business Council for the region to produce “what we consume and consume what we produce” is timely. This challenges member states to promote value-addition initiatives, particularly among SMEs, to deepen and broaden the industrial sector. It’s such efforts that would lay a firm foundation that would allow for improved performance of the manufacturing sector. However, regional governments must be ready to review laws that discourage trade and fair competition. The EAC Heads of Summit meeting held in Dar es Salaamm, Tanzania on Sunday  raised the issue of non-tariff barriers and the declining trade among member states. This calls for bureaucrats in the region to revise policies that affect manufacturing and trade within the bloc....

The discovery of oil, gas and mineral deposits in East Africa has paved the way for ambitious infrastructure projects that have attracted at least $3.4 billion from international lenders in the past year. The World Bank, the European Union and China are the region’s main infrastructure financiers. According to the Deloitte African Construction Trends Report 2016, Kenya had initiated the highest number of projects, 11, followed by Ethiopia and Uganda, with nine projects each, and Tanzania with eight. China and the EU have been the biggest financiers of Kenya’s infrastructure projects, with roads taking the biggest share of the funds. The EU, in partnership with other lenders — the German Development Bank (KfW), the European Investment Bank (EIB) and the African Development Bank — is funding key roads on the Northern Corridor, including the $151.7 million Mombasa-South Sudan link road and the $152.2 million Mombasa-Mariakani road. Walter Tretton, head of infrastructure in the EU delegation to Kenya, said the new link roads are a game-changer, in some places cutting the journey from days to hours. “The new roads will also help reduce congestion while improving the competitiveness of the port of Mombasa,” Mr Tretton said. Northern Corridor The EU, through the Africa Infrastructure Trust Fund (EU-ITF), has given $22 million to fund the Mombasa-Mariakani road while KfW and EIB have given $55.2 million each. Kenya is expected to inject $19.8 million. The proposed Kitale-Morpus road in western Kenya, which is expected to eventually link Tanzania and South Sudan through Kenya, will be...

What are the primary non-tariff barriers in Kenya? FRANK MATSAERT: The non-tariff barriers that affect Kenya the most are often imposed by Kenya itself. The first problem is weighbridges with the amount of delays, traffic congestion, overloading and transparency. The second problem is roadblocks, particularly on the trade corridor between Tanzania and Kenya. The third problem revolves around border institutions, particularly those with Tanzania and Uganda. Here, the border crossings open at varying times and when trucks arrive, they need to wait until the crossing opens. They also often still need to show physical rather than electronic documents, which hinders efficiency. Lastly, there’s also an issue with standards recognition between countries, and sometimes there are multiple institutions required to export and move goods around. This obviously creates quite a lot of complications for companies doing business on both sides of the border, and these all heavily affect the country’s neighbours. As far as remedies go, weighbridges can be replaced with modern weigh-in-motion bridges. Not only that, they can be linked across borders as well. To remedy the roadblock issue is a bit trickier, but it should definitely include more monitoring of roadblocks and making the private sector more aware of the cost that they incur for companies. For border institutions, revenue authorities should simply agree on a standard 24-hour opening for busy borders so traffic congestion can be avoided. Document processing should also be automated. For standards recognition, the main driver for efficiency will be harmonisation and mutual recognition. How...

For many years Rwandans have been dependent on second hand clothes imported from Europe and the United States. They are affordable and their high demand kept traders in business. However, the East African Community (EAC) partner states have agreed to systematically phaseout importation of second hand clothes in a way that will not hurt people dealing in them. In the Heads of State summit that was held in Dar Es Salaam, on May 20, partner states adopted a method to promote local apparel industries that will help meet local demand and indirectly discourage import of second hand clothes. “Partner states agreed that for now, the best approach to phaseout second hand clothes is by supporting local industries instead of banning importation of the clothes once and for all,” Francois Kanimba, Minister of Trade, Industry and East African Community Affairs today. In February 2016, five heads of state in the East African Community – Burundi, Kenya, Rwanda, Tanzania and Uganda – agreed to bring about a total ban on imports of secondhand clothes by 2019. While commenting on motives of the ban then, Rwandan Minister of Finance and Economic Planning Amb. Claver Gatete said that ending the trade was not just about industry, “it is just not acceptable according to our dignity.” “Every year, we spend over $15 million to import second hand clothes. Wearing such clothes is not worth our value,” said Claver Gatete, Rwanda’s Minister of Finance and Economic Planning. However, the EAC has since realised that the ban...

Dynamar B.V. of Alkmaar, The Netherlands, has recently issued another report in its Container Markets and Trades series: the fourth biennial edition of the “East & Southern Africa (worldwide) Container Trades”. Salient details and some of the interesting findings of the study are discussed in this review. West Africa West Africa is clearly moving into the direction of maturation. Compared to East Africa, the ships are bigger, there are more carriers and there is a substantial presence of international port operators. Currently, 112 box ships sail the core Asia-West Africa routes. Deployed by ten different carriers, their average capacity is 5,300 TEU, with the biggest ship measuring no less than 13,100 TEU. East Africa East Africa still has clearly some way to go compared to West Africa. With 2,900 TEU, the average of the 52 container vessels serving the area from Asia is little more than half the size of its West African sister. Including the largest 4,900 TEU unit, they are operated by nine different carriers. Hub and spoke is not practiced in East Africa. Hutchison Port Holdings (Dar es Salaam) was the single foreign terminal operator in the region until, recently, DP World started operating Berbera and sister company P&O Ports announced to develop Bosaso. Mombasa, the region’s largest outlet, is operated by its port authority. Defunct, but increasingly served Somalia may still be considered partly defunct, ever more containerships are coming to its ports. Eight different services are concerned, operated by six carriers: CMA CGM, Emirates Shipping,...