Kenya is negotiating with 44 African states for a new Free Trade Area for its agricultural and industrial products targeting a market of 1 billion people, the Trade, Industrialization and Cooperatives Cabinet Secretary (CS), Peter Munya has revealed. Munya said he was optimistic that all the target countries will assent to the Free Trade Area Treaty by July 2020 which will enable trade and other commercial activities to kick off among member states signatories to the agreement. At the same time, the CS further stated that Kenya had entered into a new trade agreement with the United States of America (USA) where the two countries’ bilateral engagements had been upgraded to strategic status. Speaking in Nakuru on Wednesday when he presided over the inauguration of a Sh.1.2 billion ultra-modern animal feeds manufacturing plant owned by consumer goods producer BIDCO Africa Group, Munya said favourable trade agreements within the East African Community (EAC) had exposed Kenya’s products to a market of 150 million people. “The new flow of local and foreign investments into the manufacturing sector in Nakuru is a blessing to both the region and Kenya as industrialization is the driving force for any economy. We need to create reliable regional and international markets for our goods and services if the economy is to grow,” he said. “No country has grown without industrialization, and no Industrialization is sustainable without reliable markets. Our negotiating teams have also ensured that our products easily access the Common Market for Eastern and Southern Africa...

Government of Kenya has given Uganda 20 hectares of land to build an inland container port at Naivasha. "The distance from Mombasa port to Nairobi is 700 kilometres and Nairobi to Naivasha is 120km, making it 820km from Naivasha to Mombasa, which is too long. So a port being at Naivasha will shorten the distance," Mr Kiema Kilonzo, the Kenyan High Commissioner to Uganda, said yesterday while addressing the media ahead of Kenya's Independence Day on Thursday next week. He said the port will be managed solely by government of Uganda as Ugandan traders will not have to travel the long distance up to Mombasa but rather clear their containers at Naivasha. He noted that building of the inland port will bring Mombasa port closer to Uganda as Kenya's standard gauge railway will be used to bring the containers from Mombasa port to Naivasha where they will be cleared from by Ugandan traders. He said Uganda Revenue Authority will now have to move their Mombasa office to Naivasha to make it easy for traders to clear their containers in time. The High Commissioner noted that Uganda is Kenya's biggest trading partner in East African Community. When Daily Monitor contacted the Ministry of Works and Transport public relations officer, Ms Suzan Kataika, about the progress on the Naivasha port project, she promised to get back to us but did not and neither did she answer our repeated calls to her cellular line. The ministry's Chief Engineer, Mr Samson Bagonza, could not...

The European Union and COMESA have signed 8.8 million Euros Contribution Agreement to increase private sector participation in sustainable regional and global value chains through improved investment/business climate and enhanced competitiveness in the COMESA region. The funds will be used to implement the Regional Enterprise Competitiveness and Access to Markets Program (RECAMP), focusing on agro-processing, horticulture and leather products. RECAMP will also support pre-selected value chains based on the potential to generate value addition, job creation and attraction of investments to the region. The EU Ambassador to Zambia and Permanent Representative to COMESA, HE Jacek Jankowski and Secretary-General to COMESA Chileshe Kapwepwe signed the Agreement. RECAMP will address critical issues, such as the provision of business information, facilitating market linkages, harmonizing regional industrial policies and creating a conducive business environment to attract investments. It will strive to ensure collaboration with activities of national trade support institutions and business development and service organizations in the Member States as they provide services to value chains as part of their mandate. These include product development; facilitate technology transfer, provision of business intelligence and connection to buyers. The program will identify champions or lead firms within the selected value chains that have both backward and forward linkages with SMEs and other intermediary firms in order to enhance effect coordination reduce coordination failures and improve competitiveness. In her remarks, Ms Kapwepwe said the program will make efforts to enhance the capacities and skills of Micro, Small and Medium Enterprises to make them capable players in...

Kenya’s trade deficit in the nine months through September 2019 narrowed by 3.24 percent, or Sh27.85 billion, partly helped by reduced demand for industrial imports. The deficit — the gap between imports and exports — dipped to Sh833.03 billion in the January-September period from Sh860.88 billion in the same period last year, data published by the Central Bank of Kenya (CBK) indicates. This the first drop in deficit since 2016. Total imports dropped 3.68 percent, or Sh48.97 billion, year-on-year to Sh1.28 trillion, the statistics show, largely driven by a drop in key drivers of production in Kenyan factories such as machinery and transport equipment, chemicals and manufactured materials. Expenditure on machinery bought from abroad reduced by 5.5 percent to Sh327.21 billion, manufactured materials dropped 5.69 percent to Sh221.64 billion, while orders for chemicals dipped 7.75 percent to Sh177.78 billion. Total exports, on the other hand, slipped Sh21.12 billion, or 4.5 percent, to Sh449.47 billion due to reduced earnings from domestic exports largely farm produce. Source: Business Daily

On July 7, 2019 African Heads of State and Government held their summit in Niger and signed up the African Continental Free Trade Area (AfCFTA). The signing was a continuation of a long process. It includes the summit where 44 Heads of States and Governments met in Rwanda in March 2018 to deliberate on the matter. The free trade area is among the key issues of discussion in the continent and beyond. New as it is, there are many unknowns in this potentially very important initiative to boost trade in Africa. This piece contributes in making the AfCFTA more known. AfCFTA The AfCFTA is a free trade area outlined in the African Continental Free Trade Agreement among 54 of the 55 African Union nations. Source: The Citizen

Parliamentary Diplomacy has played a key role in Global Governance. Experts from all over the world have analysed empirical case studies to demonstrates that parliamentarians and parliamentary assemblies have an increasingly important international role. The European Parliament, said to be one of the strongest autonomous institutional actors in world politics has been at the center of Parliamentary Diplomacy but the world has been turning attention to Africa: looking into the role of parliament and cabinet in foreign policy making, especially in South Africa and the East African Legislative Assembly. According to Weiglas and de Boer (2007, pp.93-4), Parliamentary Diplomacy is the full range of international activities undertaken by parliamentarians in order to increase mutual understanding between countries, to assist each other in improving the control of governments and the representation of a people and to increase the democratic legitimacy of inter-governmental institutions. In this article, Joel Okwemba, the Managing Director at the Centre for International and Security Affairs, shares his thoughts on Why we need a Structured Parliamentary Diplomacy for Africa. Why we need a Structured Parliamentary Diplomacy for Africa. However, opportunities are abounding when it comes to: how Parliaments interact with Foreign Policy questions; how Parliaments engage with the State on these questions; how to create form and structure on Parliamentary Diplomacy; and in the development of academic and theoretical literature on the Parliamentary Diplomacy theory in Africa. Parliamentary Diplomacy also referred to as Parlomacy[1], creates opportunities that are alternatives and complimentary to traditional diplomatic approaches that rely on...

The African Infrastructure Guarantee Mechanism’ was organised as part of the 3rd African Pension Funds and Alternatives Investment Conference. It was well attended by an audience mostly composed of industry players – private pension fund administrators, trustees, asset managers, government pension funds and development finance institutions. This grouping clearly demonstrates the interest to develop such initiatives to scale up greater investments in the African infrastructure space. The session was moderated by Dr Morgan Pillay Senior Infrastructure Finance Expert from GIZ, who presented the objectives of the AUDA-NEPAD session. To objectives were; to gauge the appetite of institutional investors (pension funds) for the implementation of the African Infrastructure Guarantee Mechanism and discuss its financial potential; and to make use of the Pension Fund conference platform to consult on what can make the concept a reality. This includes possible implementation strategies and concrete action steps towards scaling risk mitigation and an African Guarantee Scheme to enable the mobilisation of African pension fund investment for African infrastructure. The session panel, with representatives from the AUDA-NEPAD, the African Development Bank; the Development Bank of Southern Africa and the Trade and Development Bank gave its interpretation of the African Infrastructure Guarantee Mechanism as instrument of risk mitigation. Industry players were requested to give their thoughts on how the development of such initiative could bring value in facilitating alternative investments in the African Infrastructure space. Deliberations included working with development partners in the development of similar initiatives such as the African Development Bank and its co-guarantee...

As discussed several times in this column, the Kenya Government has earmarked trade as a key factor towards the achievement of the Big 4 Agenda, and ultimately the realisation of Vision 2030. With a view towards harnessing Kenya’s trade potential, Kenya seeks to unlock the tried and tested economic benefits offered by Special Economic Zones (SEZ), as evidenced by the largely successful SEZ regimes of India and China. This in itself indicates a shift from reliance on Export Processing Zones (EPZ) which failed to attain the desired economic impact. Special Economic Zones, established and defined by the Special Economic Zones Act 2015, refer to designated geographical areas where business-enabling policies are implemented and sector-appropriate on-site and off-site infrastructure and utilities are provided for by the Kenyan Government. Under the SEZ regime, participating investors stand to benefit from a trade enabling environment. Notably, the Act highlights integrated infrastructure facilities, access to business and economic incentives as well as the removal of trade barriers and impediments as being key benefits accorded through the SEZ regime. Drilling down to the incentive angle of SEZs, the major selling point of SEZs in Kenya is the tax shields offered within the confines of an SEZ. Particularly, from a tax perspective, SEZs are considered to be outside the customs territory of Kenya, thereby operating within a jurisdictional bubble that shields them from taxes and similar regulatory hurdles that directly or indirectly impede trade. Consequently, licensed SEZ enterprises, developers and operators benefit from various tax rebates such...

Whenever the Kenya Revenue Authority (KRA) is mentioned, the first thought that comes to the mind of many people is purely revenue collection. Unknown to many, KRA has many other additional roles, which extend the tax agency’s mandate beyond revenue collection. These roles are spread out in the various departments, like the Customs and Border Control Department. The role of the Customs and Border Control Department also includes facilitation of secure legitimate trade, protection of our borders and promotion of national safety. This is achieved by ensuring that the export, import, transit and transhipment cargo cleared through our airports, ports and borders are not harmful to our residents and the environment. Kenya Customs has the responsibility to ensure seamless and expedited cross-border movement of cargo, services and passengers. Whereas port, border and airport cargo clearance is very clear, little is known about the Inland Container Depots (ICDs). Is the ICD in competition with the port? Is it a non-tariff barrier to international trade? The Inland Container Depot – Nairobi (ICDN) was rejuvenated in April 2018 following the construction of the Standard Gauge Railway (SGR), providing a seamless link to the Kilindini Port in Mombasa. There is another ICD in Kisumu, and an upcoming one in Naivasha. ICD Nairobi is a fully-fledged one-stop trade facilitation and logistics centre that brings together the operations of the Kenya Railways Corporation (KRC), Kenya Ports Authority (KPA), Kenya Revenue Authority (KRA) and the Kenya Bureau of Standards (Kebs). All these are lead government agencies for...

Kenya could be allowed to secure its own preferential market access for exports to the European Union if the regional Economic Partnership Agreement fails to take shape, EU has signaled. This comes amid continued delays by the East Africa Community(EAC) member states to ratify the EPA deal as a bloc, which would secure duty-free quota-free market access with the 28-member union. While Kenya and Rwanda signed the EPA in September 2016, with Kenya ratifying the pact the same year,Tanzania, Uganda and Burundi are yet to ratify the EPA. For the EPA to enter into force, the three remaining EAC members need to sign and ratify the agreement. The delay is threatening Kenya's free market access for its exports to Europe. EU ambassador to Kenya Simon Mordue yesterday said Kenya could be allowed to go ahead solo under the "variable geometry" provision, which allows certain members states to implement trade agreements faster than others or before others which are not ready. “Kenya is obviously very keen together with Rwanda to move forward and start this trading arrangement with European Union as quickly as possible because they full understand the benefits of this agreement,” EU ambassador to Kenya Simon Mordue said in Nairobi yesterday. “You come to us and send a signal that there is a wish to pursue variable geometry. This is something that the EU would look at very carefully and say how we would best be able to respond,” Mordue added. Tanzania in 2016 rejected the deal on claims...