The East African Community (EAC) is not ready for the fourth industrial revolution even as the wave sweeps across the world. This is according to experts who spoke at an industrial conference at the EAC Secretariat in Arusha this week organised by the United Nations Industrial Development Organisation (Unido) and German Society for International Cooperation. The Global Manufacturing Industrial Summit (GMIS) roadshow sought to explore the implications of the revolution for the region’s manufacturing, industrialisation and investment prospects. For us to achieve inclusive and sustainable industrialisation, we need to invest in advanced disruptive technologies like 3-D printing, Internet of Things, advanced robotics and drones, which will make manufacturing smarter, efficient and greener,” said Stephen Kargbo, Unido Representative in Tanzania, Mauritius and EAC Secretariat. He added that the advancement of these manufacturing technologies will also help improve acquisition of agro-industries, water and sanitation quality for the rapidly developing towns and cities. Most of these industrialised countries account for over 90 per cent of digital production technologies, have invested hugely in research and development campaigns and we have to move in that direction,” added Kargbo, who said there is also need for solid industrial policy. EAC first came up with an industrialisation policy for 2012-2015 but it failed to be implemented and was revised to 2021-2032. The contribution of manufacturing to the gross domestic product in East Africa is estimated at 8.9 per cent, which is considerably below the average target of about 25 per cent that all the five partner states...

The meeting is held during the “Africa Industrialization Week”, organized by the African Union from the 18th to the 22nd November 2019, according to the press statement from AFZO. The attendees include over 220 delegates representing 43 countries attended this important event, including 60 African economic zones, 30 experts, as well as several representatives of governmental authorities, international institutions and public and private organizations. Several international speakers representing international and financial institutions such as UNCTAD, UNIDO, UNECA, AfDB etc. shared during this event their expertise on effective means for economic zones development in Africa. the statement noted that various topics related to challenges and trends of African economic zones were addressed including strategic directions and effective governance model, contribution of economic zones for FDI growth and job creation, importance of logistics competitiveness within economic zones, skills development and training. The opening ceremony of the Africa Free Zones Organization’ 4th Annual Meeting was cochaired by M. Albert Muchanga the Commissioner for Trade and Industry of the African Union Commission (AUC), Ms Dagmawit Moges the Minister of Transport of Ethiopia, M Mehdi Tazi Riffi the President of the Africa Free Zones Organization. Serving the development of Economic Zones in Africa AFZO was founded back in 2015 by Tanger Med along with other African economic zones. Africa Free Zones Organization brings together the leading African economic zones and institutions in charge of the development, management and promotion of economic zones in our continent. The Africa Free Zones Organization aims to ensure: – Representation...

East Africa’s private sector players are concerned by the slow pace of resolving a common external tariff (CET) regime which is expected to usher in a free trade zone. A free trade zone will increase intra East African Community (EAC) trade, as there will be no duty on goods and services imposed amongst them. The regime will also agree on a common CET, where imports from countries outside the bloc will be subjected to the same tariff across partner states. Though Nicholas Nesbitt, the chair of East African Business Council, did not directly refer to the frustrations, it is an inference taken out of his statement when he said the issue was creating a “dilemma.” Council agenda Nesbitt said finalising the review on CET was part of an item on the council’s agenda, to be presented to the EAC council of ministers for delivery of quick wins for the region. “There are ongoing discussions whether to adopt a three-band or four-band structure with the highest rate of 35 per cent CET. The challenge is if you are a manufacturing country, you will want a high CET while trading countries will want a low CET to import finished goods for your citizens. Therein, lies the dilemma,” said Nesbitt. The implementation of CET is behind schedule, as it was to take effect on July 1, this year. The bloc’s member states had agreed there be a CET of zero per cent on raw materials and capital goods, 10 per cent on intermediate...

The African Development Bank (AfDB) has signed an unfunded $250-million (Shs920bn) Risk Participation Agreement (RPA) facility with ABSA – a pan-Africa financial institution with a solid presence in 12 African countries. The 3-year RPA facility was signed November 12, on the sidelines of the Africa Investment Form through its trade finance operations. Under this 3-year RPA facility, the Bank and ABSA will share default risk on a portfolio of eligible trade transactions originated by African Issuing Banks (IBs) and confirmed by ABSA. Leveraging the Bank’s AAA rating, ABSA will underwrite trade transactions issued by African issuing banks across key sectors like agriculture, energy, and light-manufacturing with a special focus on Small and Medium Sized Enterprises (SME’s)  in fragile and low-income African countries. The Bank’s commitment under the RPA is to assume up to 50% (and 75% in special cases) of every underlying transaction issued by the IBs, while ABSA will confirm such a transaction and bear not less than 50% of its underlying risk. Working with strategic partners like ABSA, the Bank’s  trade finance operations aim to facilitate inter and intra Africa trade by reducing the trade financing gap on the continent. Since 2013, the Bank’s RPA program has supported over 16 issuing banks with about US$650 million  limits in Southern Africa alone, with special focus on SMEs and local corporates in manufacturing, agribusiness, import/export and energy sectors. In the same period, the program supported over $4billion in trade volumes across Africa, with $938 million of that being intra-Africa trade....

For the first time, Africans need visas to travel to less than half of other African countries, the report finds. A record 87% of African countries either improved or maintained their score, an increase of 9 points from 2018. The biggest improvements were made by Ethiopia, which moved up 32 places to join the top 20 in terms of openness, mirroring the country’s progress in the World Bank’s Ease of Doing Business Index. Senegal’s move to introduce visas on arrival for some African countries and removing visas required before travel pushed it up into the top 10. Yet the freedom of movement that will be needed to make the Africa Continental Free Trade Area (AfCFTA) a success remains a work in progress. Africa’s infrastructure deficit was a central theme at the AIF, which highlighted the need to attract investment into large-scale railway and road projects. Such projects will both require and further stimulate the free movement of people. Only two African countries, Seychelles and Benin, offer visa-free access to all Africans. Higher income African countries are among the laggards. Seven out of eight of Africa’s upper-middle income economies have low visa openness scores, the report finds. Egypt, Morocco, Algeria and Cameroon remain near the bottom of the table. Trust deficit The absence of the protocol for free movement of persons was a notable omission from the agenda at the African Union Summit in Niger in July, according to a paper by Mehari Taddele Maru of the Migration Policy Centre at the European University Institute in Florence. The AfCFTA was launched at...

First international digital road freight platform to be launched in the continent; Provides shippers and carriers a one-stop platform for road freight connections for domestic shipments within South Africa and international movements to several neighbouring countries; Further expansion to connect shippers and carriers within Sub-Saharan Africa (SSA) is planned for early 2020. Digital freight forwarder Saloodo! a subsidiary of DHL Global Forwarding, the leading international provider of air, sea and road freight services, today launched its digital logistics platform for shippers and transport providers in South Africa, bringing the first digital road freight solution to the region. An efficient road freight network is a key conduit of trade within a geographically wide-spread country such as South Africa but also with 16 landlocked countries within Sub-Saharan Africa (SSA). However, much of the region’s road freight operations remain fragmented and highly traditional, missing out on the visibility, efficiency and security that logistics technology offers. “Digital transformation is a top priority for the industry and given the demographics, we expect demand for digital transformation to be driven by emerging markets globally,” said Tobias Maier, CEO of Saloodo! Middle East and Africa. “Africa is the world’s youngest continent with 60% of the continent below 25. This is a dynamic generation of digitally-minded young adults, demanding smart, digital solutions both on the business and home front.” With South Africa as its launch pad into Sub-Saharan Africa, Saloodo! is the first digital logistics platform available in the region that offers a single, simple and reliable interface...

Growing momentum behind regional integration, economic reforms, technological advances and infrastructure development are among the key factors fuelling business growth in sub-Sahara Africa, said a new whitepaper released by Dubai Chamber of Commerce and Industry in cooperation with the Economist Intelligence Unit (EIU). The report, entitled “Promise and Perils: Scaling up businesses in sub-Sahara Africa”, was issued ahead of GBF Africa 2019 in Dubai. The findings shed light on the current business climate in sub-Sahara Africa and examined attractive business prospects offering the most potential for investors in the UAE and wider GCC region. Key growth drivers The report highlighted the importance of regional integration initiatives such as the East Africa Economic Community, Single African Air Transport Market and African Continental Free Trade Area (AfCFTA) in removing trade barriers and driving business exchange. The AfCFTA is expected to liberalising trade and investment policies and ease easing operational challenges related to international money transfers and payments. Combined, these allow African SMEs to expand operations across markets, creating attractive opportunities for investors too. Expanding telecommunications networks are facilitating the growth of internet connectivity, mobile money and new digital services that build on it. Mobile money, which facilitates money transfers and payments, is also a growth enabler as it moves into business lending. Improved internet connectivity is expected to drive the next wave of technological innovation, enabling companies to develop new, digital services for consumers on the continent. By 2025, 3G mobile network coverage is expected to account for 60% of the mobile...

The value of intra-trade among East African Community partner states increased to $5.98 billion in 2018 from $5.46 billion in 2017, accounting for a 9.4 per cent growth. This comes as member countries opted to trade with each other in the wake of falling demand for the region’s agricultural products in the US and the rest of the world. The East African Community Trade and Investment Report (2018) shows that all EAC member states save for Burundi recorded growth in trade with their regional counterparts. The report prepared by the EAC Secretariat shows that Uganda, Tanzania, Rwanda, South Sudan and Kenya’s combined exports to the EAC and Southern African Development Community regions amounted to $3.1 billion and $1.9 billion in 2018 respectively. This shows, however, the growth in intra-EAC trade slowed down to 9.4 per cent last year compared with 24.8 per cent in 2017. The positive trend signals the importance of intra-EAC trade that has been stifled by persistent trade disputes on rules of origin, non-tariff barriers, inadequate value addition to the agricultural sector and competition from other producers and regional blocs that benefit from export subsidies. In 2015 and 2016, intra-EAC trade was in the negative territory. Burundi’s total trade with other EAC partner states fell by 11 per cent to $150.9 million in 2018, from $162.6 million in 2017. Kenya’s total trade with EAC partner states increased by 4.7 per cent to $1.95 billion in 2018 from $1.86 billion in 2017, mainly on account of increased total trade...

African countries have been urged to carefully analyze global lessons and think beyond short-termism so as to effectively tap into the benefits offered by the African Continental Free Trade Area (AfCFTA) Agreement. The latest call was made by the Institute for Security Studies (ISS), an African non-profit organization, as it stressed that "global lessons show that for AfCFTA to work, the continent's leaders must think beyond short-term election cycles." The ISS, in its latest publication on Thursday entitled "Can African leaders put free trade above nationalism?" also noted that the signing of the continental free trade pact "couldn't have come at a better time for the continent," emphasizing some of the latest developments in the global trade relations. According to the institute, the collective effort required to get 54 of the 55 African Union (AU) member countries to sign the AfCFTA, "particularly on a continent divided by disparate political agendas, short-termism and sporadic diplomatic standoffs, shouldn't be underestimated." "While the agreement is lauded as an African solution to African problems, it is worth remembering the pitfalls of those who've traveled a similar journey to avoid the same mistakes. This is even more important as trade agreements worldwide show signs of unraveling," the ISS said. Noting that trade relations in Europe were forged over decades following World War II to counteract the factors that caused the war, and collaborate for sustained economic growth and prosperity. Reaching agreement was an arduous process, the ISS stressed that "Africa seeks the same outcome in...

Arusha. The secretariat of the African Continental Free Trade Area (AfCFTA) will be operationalised in March, next year. The agreement came into force on May 30, this year, after it was ratified by the required 22 African Union (AU) countries. This was revealed here on Monday at the start of a symposium on the trade agreement which attracted scholars and experts from across the continent. The secretariat of the intra-African trade body will be established in Accra, Ghana as appointment of the secretary general is underway. “Structure and budget of the secretariat has been approved”, said Dr. David Luke, the coordinator of the African Trade Policy Centre based in Addis Ababa. He said it has been proposed that AfCFTA establish office in each state party; countries which have signed and ratified the agreement. Source: The Citizen