Kenya has kicked off their side of the infrastructure projects that were promised and agreed to by the East African Community members under the East African Railway Master Plan. The US$ 24 billion project, with the Acronym LAPSSET (Lamu Port, South Sudan Ethiopia Transport Corridor) is a massive infrastructure project originating from Kenya, consisting of a 32-berth port on the country’s north coast, a railway, an oil pipeline, highways, international airports, and resort cities. This will definitely answer the question of ensuring a timely delivery of goods to both local and international markets for the area so affected. There have been, however, several hickups to the project mainly due to bickering by member states and disagreements that, do not seem to originate from realistic objections or issues other than differences in opinion and, perhaps ego. There was a pipeline slated to use this same LAPSSET corridor from Uganda to the coast, but this was shelved in favour of the Tanzania route. Ofcourse, there are issues of security in the north of Kenya, with several swathes of land being rather lawless due to the difficulty to reach these areas. However, one of the creators of the project, Gerrishon Ikiara, says the infrastructure project itself will bring about security in the area due to the fact that the area will now be easy to reach. This is all good, but there is an air of going it alone in this project. The name LAPSSET does not have anything to do with the...

ARUSHA, Tanzania - The United States Agency for Development (USAID) has met with officials of the East African Community (EAC) Secretariat to operationalize the five-year Regional Development Objectives Grant Agreement (RDOAG) they received last year.    “RDOAG provides for changes in the way USAID will do its business; strengthen USAID-EAC Partnership; stronger collaboration, coordination and communication, and institutional strengthening,” said Candace Buzzard, USAID’s Deputy Mission Director for Kenya and East Africa. USAID granted EAC US$194 million under the RDOAG which was launched in November last year, money is meant to be spent on shared development goals over the next five years. The money is to benefit sectors funded under the RDOAG which include among others health, environment, natural resources, climate change, trade, security and energy.Buzzard said USAID will coordinate more closely with the EAC to ensure better delivery of project goals. “USAID’s gesture had sent a strong signal of its desire to support the Community attain its goals,” said, the EAC Secretary General, Ambassador Libérat Mfumukeko. Mfumukeko said USAID’s contribution would enable the Community to achieve many things. He said of the US$194 million, about US$30 million will finance institutional strengthening within the EAC Secretariat while the remainder will support other development partners in their efforts to contribute to the EAC regional integration agenda. The Secretary General said that the new EAC-USAID Regional Development Objective Grant Agreement (RDOAG) 2016-2021 would deepen integration, improve cross-border risk management and strengthen regional institutions leadership and learning. He added that the RDOAG would support...

As director general of the World Trade Organisation (WTO), Pascal Lamy found himself at the front line of globalisation, which for him has had the extremely positive effect of reducing poverty, even as he recognises that it has created greater inequality. He believes countries that have opened up to trade have fared better in terms of growth and development than others, and he disagrees with the assertion that we are approaching the limits of the current system. Globalisation, he argues, is just another form of capitalism, whose ability to create efficiencies and reduce poverty is well known. But these benefits come at the expense of destructive and creative processes – “it works because it’s painful and it’s painful because it works.” He can’t see a crisis of globalisation that isn’t a crisis of capitalism, and capitalism is in a permanent state of crisis, always re-inventing itself. The problem is with distribution of the benefits of the greater efficiencies, which is more acute than it was 20 years ago. But we cannot reverse these effects by closing down trade, he says. The problem is one of social policy, of local consensus over taxation and social security – social issues not very different from those we faced in the nineteenth century. What he does think needs to be improved are global systems of governance. Regulation of international relations and the organisation of global cities can no longer rely on nation states alone, but must also involve NGOs, multinational businesses, governments and cities....

IN SUMMARY IMF managing director Christine Lagarde said fissures in the bloc over Economic Partnership Agreement, the single tourist visa, non-tariff barriers on movement of people, goods and capital were signs that the building blocks were not firmly in place. While the EAC has achieved major milestones on integration projects like the Customs Union, Common Market, the East African Legislative Assembly, EAC Court of Justice and others, differences on some issues are increasingly threatening the bloc’s future. The International Monetary Fund fears that the integration of East African economies may have been built on quicksand and has called for a pause to lay a stronger foundation for its stability. IMF managing director Christine Lagarde said fissures in the bloc over Economic Partnership Agreement, the single tourist visa, non-tariff barriers on movement of people, goods and capital were signs that the building blocks were not firmly in place. “Coming from the European Union and a country that is part of the Eurozone, I would certainly stress that making haste slowly is probably the best way to go and consolidate one step at a time, to make sure that the steps you have taken are actually solid, sustainable and will take you to the next level,” Ms Lagarde said while on a visit to Kampala, Uganda last week. She said the East African Community should focus on consolidating integration gains achieved in infrastructure, the Common Market and the Customs Union integration while going slow on the monetary union and federation projects in...

The government has began the inspection and commissioning of locomotives for the standard gauge railway (SGR), moving to indicate that the completion of the first phase will be on schedule. Speaking to journalists at State House, Spokesperson Manoah Esipisu said the first journey from Mombasa to Nairobi will start in June. "Testing, commissioning and inspection of these locomotives has already begun. Kenya remains on track to see the first SGR journey to Nairobi from Mombasa on June 1, 2017," Mr Esipisu said. Mr Esipisu said more locomotives and passenger coaches will be delivered later. The first batch of locomotives arrived at the Mombasa port on January 10. "Eight heavy haul freight locomotives, passenger locomotives as well as two shunting locomotives have been delivered. More deliveries are expected in the coming months," he added. The President Uhuru Kenyatta will commission the Sh372 billion project after its completion. He further said Kenya Railways has procured 56 locomotives, 40 passenger coaches and 1,620 wagons. Last month, Transport Cabinet Secretary James Macharia said that the second batch of six locomotives is expected to arrive this month and the last batch of 44 by May. Mr Macharia said the railway will decongest the port and boost cargo transportation to Nairobi. The railway will connect Kenya, Uganda, Rwanda and South Sudan. Source: Daily Nation

The deadline for the signing of the Economic Partnership Agreement (EPA) between the East African Community (EAC) and the European Union elapsed again this week without any firm decisions by the EAC. The EPA was supposed to ease comprehensive access to the wider European market devoid of quotas and other restrictions. Of the EAC members, only Kenya and Rwanda have signed the agreement and the others still holding out are only hurting the region’s growth prospects. Many argue that they have to carefully study the implications of signing, whether their interests will not be shortchanged. They fear that their counties will be inundated with European merchandise. Those could be valid reasons as the EAC’s population of over 160 million is a tempting market for anyone and many countries would like to take a piece of the pie. But should we continue on that narrow-minded approach of fearing competition? EAC should look at the larger picture since the world today is a global village. We should be looking out for opportunities and not fear to venture into the unknown. There is a Kinyarwanda proverb loosely translated to mean that “a bird that does not fly out will never know where food is plenty” (Akanyoni katagurutse ntikamenya iyo bwera). We need to test the temperature, otherwise we may never know what suits us or what comes as a double-edged sword. We have to be daring and do away with paranoia. The world is a competitive stage and we ought to measure our...

The government has raised concern over the steady decline of Kenya's regional trade market share which is threatening to wipe away economic gains. The Industries, trade and cooperatives ministry says unlike previous years where Kenya enjoyed dominance as the economic powerhouse for the region dominating in agriculture, tourism and export industry, the country has begun loosing grip to her peers. The decline in the manufacturing sector’s output has also affected trade with industries struggling to cope in a tough business environment, characterised by massive layoffs and closure of some businesses. Manufacturers are grappling with high cost of energy at Sh11 per kilowatt hour, compared to Ethiopia, where factories are enjoying lower tariffs of between four and five cents per kilowatt hour. East African Affairs Principal Secretary Betty Maina, said this was a pointer that the country needs to improve the quality and competitiveness of local goods in order to regain market access within the region. “This has been gradually taking a turn with most of the countries in the region that once relied on our products and commodity resorting to other markets that they have identified cheaper and of better quality,” Maina told the Star in an interview. Threats from illicit trade are also a major concern for manufacturers. According to the Kenya Association of Manufacturers, local industries are losing at least 40 per cent of their market share to counterfeiters which has “unfairly” reduced the industry’s earnings.  India and China control a major stake of imports to Kenya, latest...

Deadline for signing of the Economic Partnership Agreement (EPA) between the East African Community (EAC) and the European Union lapsed, yesterday, with the former still undecided. The deadline, which was initially October last year, had been extended to February 2 (yesterday) to give member countries more time to review the document and come up with a common position as a bloc. By the lapse of the previous deadline, only Rwanda and Kenya had signed the agreement. However, the agreement is expected to be effective if all EAC partner states accede to it. Across the region, opinions on whether to sign it or not have been sharply split with some with the view that EPAs are not ideal for the region as it will open up the region to more European exports which could promote unfair competition and kill regional industries. Those for the agreement argue that the deal provides for EAC exports access to European markets duty-free and quota-free, while the European Union access to EAC market provides for a gradual liberalisation of tariffs. During the previous EAC heads of state summit held in Dar-es-Salaam, Tanzania, the leaders requested for additional time for clarification on some of the contentious issues raised by partner states before considering the signing of the agreement as a bloc. All the production is exported to France. Faustin Niyigena Rwanda-Kenya statement of intent Despite EAC’s delay to sign the agreement, representatives of the bloc say they are encouraged by the determination shown by Rwanda and Kenya...

Uganda's President Yoweri Museveni and Tanzania's President Dr. John Magufuli will meet February to agree on East Africa's way forward on the controversial Economic Partnership Agreement (EPA). The EPA is supposed to be negotiated between the EU and member states of the East African Community (EAC). Kenya and Rwanda have already signed the deal but it won't be operational until all the East African Community member states sign the agreement, which is protested by Tanzania. Museveni said the EAC leaders need to discuss the issue, point on point because scattering it without discussion would be a mistake. "EPA is also about East Africans. If we scatter it without discussions, it would be a mistake. Am more worried about the unity of East Africa," he said in Addis Ababa. EAC Heads of State led by their chairman Magufuli had agreed in September to push to later the bloc's commitment on the deal to allow more deliberations and negotiations on the matter. The Tanzanian parliament already voted against signing of the EPA negotiated between the EU and member states of the East African Community. The two leaders also discussed the situation in Burundi and agreed to meet and to harmonise on how to handle the situation. Museveni is mediator in the Burundi peace process while former Tanzania President Benjamin Mkapa is facilitator. President Museveni meets leaders of Sudan, CAR, Zambia and Namibia President Yoweri Museveni, in his new role of First Vice-Chairperson of the African Union, has met a series of African...

In Summary In the 1990s, when Uganda was a reform star, Kenya was labouring under Kanu misrule and corruption, Kampala exploited the opportunity to rise to regional leadership. While many elsewhere see the EAC as a model of cooperation, it is also a fact of history that at various points the progress of one country or the other in the region has been dependent on the misfortunes of its neighbours. On Monday, Kenya’s Foreign Affairs minister Amina Mohamed lost the election for chief of the African Union Commission to Chadian foreign minister Moussa Faki Mahamat. On Tuesday she said some of the pledges of support made by neighbouring countries were “deceptive”. Ms Mohamed went into the elections with many calling her the “front runner”. The East African Community countries had backed her, as had others in Igad. But if reports are to be believed, Burundi, Djibouti, and perhaps most surprisingly, Uganda, threw her under the bus in the end. While Kampala has not yet spoken officially, sources there say Uganda decided not to vote for her in the seventh round because at that point she couldn’t win. The suggestion being that without any prospects for her victory, it was time to curry favour with Mr Mahamat who looked set to take it. Not surprisingly, in Uganda where its own candidate, former Vice-President Speciosa Kazibwe, was felled quickly and ignominiously when she contested for the job during the deadlocked vote in Kigali last July, the media coverage of Amina’s fortunes was...