Rwanda parliament has ratified the 2015 Tripartite Free Trade Area (TFTA) agreement, a market of three regional blocs. TFTA brings together country members of the Common Market for Eastern and Southern Africa (COMESA), East Africa Community (EAC) and the Southern African Development Community. The ratification was passed this Wednesday without going through the commission scrutiny but came with debate on its importance, fears of duplication of the recently launched African Continental Free Trade Area (AfCFTA) worth $3.4 trillion. TFTA consists of a US$1.2 trillion free trade area, incorporating 26 African nations, with a population of 632 million people. The overall aim of the TFTA is to remove barriers to trade and to ease the movement of people between its signatory nations. Minister of Trade and Industry, Soraya Hakuziyaremye who presented the bill said “This agreement is very important to our export market since it introduces our country to a much wider market as it includes the Southern Africa Development Community of which we are not member.” At first, some members of parliament were hesitant to endorse it on ground that the agreement may be just a duplication of the already existing AfCFTA. “I sense an issue of duplication here. We should be sure that we would not loose taxes to these agreements,” MP Frank Habineza said. For MP Ignacienne Nyirarukundo, the AfCFTA was enough. MP Christine Muhongayire backed the idea of her colleagues but advised that parliament takes its time to assess the deal in the commissions. “It’s advisable to...

Local manufacturers are likely to benefit immensely from a newly implemented Africa-wide trade pact that provides access to a bigger market for their goods. The African Continent Free Trade Area (AfCFTA) protocol, launched at the Africa Union summit in Niger on Sunday after five years of deliberations, provides a single market of goods and services for 1.2 billion people with an aggregate Gross Domestic Product (GDP) of over $2 trillion (Sh200 trillion). ELIMINATE DEFICIT The adoption of the historic 55-nation agreement makes the whole continent a single market. Protocols will be aligned such that a Kenyan farmer can export avocado to Egypt duty-free, just as a Rwandese will be able to buy cocoa from Ghana. Kenyan manufacturers and exporters are upbeat that the trading bloc will be a boon for the country’s trade. Export Promotion Council chief executive Peter Biwott said Africa-wide trade, if well planned, could double the country’s exports, thereby eliminating the Sh1.15 trillion gap between exports and imports. “We import [goods worth] Sh1.7 trillion and we export Sh613 billion. The deficit can be eliminated if we increase our manufacturing and export enterprises. We target to get our exports to the mark of Sh2.3 trillion,” said Mr Biwott. Robust plan The government, he said, has a robust plan to make export trade efficient for existing enterprises as they recruit and train new ones in collaboration with the county governments. This is in a bid to scale up the range of products besides improving the manufacturing sector as a...

Infrastructure investment is one of the key pillars of the Agenda 2063 and for this to be achieved financing of these projects is still the continent’s biggest challenge. Rwanda’s Finance Minister, Dr. Uzziel Ndagijimana at the Africa 50 Summit joins CNBC Africa for more Source: CNBC Africa

On November 30, 2019, the East African Community (EAC) will be celebrating 20 years of existence. Lest we forget, it was on November 30, 1999 at Sheikh Amri Abeid Memorial Stadium in Arusha, Tanzania that three heads of state of the Republic of Uganda, the Republic of Kenya and the United Republic of Tanzania, put pen to paper to sign the treaty reviving the EAC. Again, to jog our memory, the EAC had earlier been established from 1967 and it collapsed 10 years later in 1977. The current EAC 20-year journey has been remarkable, the inevitable challenges notwithstanding. The framers of the Treaty establishing the EAC envisaged a community that would be anchored on four pillars. This is aptly captured in Article 5 where, the Partner States undertook “to establish among themselves, a Customs Union, a Common Market, subsequently a Monetary Union and ultimately a Political Federation”. The Partner States have signed and ratified three protocols in line with these pillars. Implementation of these protocols is at various stages with a commendable degree of success. The pillars are very crucial forerunners to the ultimate goal of Political Federation. Thus, in 2017, the EAC heads of state agreed on Political Confederation as a transitional model to full East African Political Federation. All the Partner States have, accordingly, nominated experts and set up a team that is currently working on the confederation constitution. Uganda’s former Chief Justice Benjamin Odoki and Makerere University’s Prof Murindwa Rutanga are part of this team. When asked...

President Kagame and Chairperson of the East African Community (EAC) has said that the implementation of the new African free trade area is an important step forward towards the unification of Africa. He was speaking at the 12th Extraordinary Summit of the African Union on Sunday in Niamey capital of Niger where he joined other Heads of State and Government from across the continent to launch the operational phase of the African Continental Free Trade Area (AfCFTA). He thanked Niger’s President Mahamadou Issoufou for the role that his country and him have played in signing the free trade area pact and hosting the participants in Niger to launch it. “History will record the central role played by the President of Niger, Mahamadou Issoufou, in bringing us to this point. Our task now is to finalise the remaining negotiations and operational instruments in a timely manner,” he said. Also discussed at the summit were key issues including the removal of non-tariff barriers and regulations controlling trade liberalization, rules of origin and the development of a digital payment system. Meanwhile, Nigeria honored the promise it had made earlier on Tuesday by signing up to the pact. President Muhammadu Buhari noted that free trade must also be fair trade. “As African leaders, our attention should now focus on implementing the AfCFTA in a way that develops our economies and creates jobs for our young, dynamic and hardworking population,” he said. Gabon and Equatorial Guinea have also joined making the number of countries that...

The last time Kenya’s growth surpassed 10 per cent was in 1966, 1971 and 1972. The few sectors that grew at more than 10 per cent last year included electricity supply, transport such as postal and courier activities, accommodation and food services plus information and communication. When shall we reach that magical rate again? What needs to be done and by whom? Ten per cent appears ambitious but is reachable. China did that for years to reach her current state of development and start challenging the big economic powers like the US and Japan. Six per cent is not far from 10, but that four per cent makes a big difference in the long run. It would not be an exaggeration to say that without 2007/08 post-election violence, 10 per cent was achievable. This brings us to what needs to be done to reach that magical number. Election cycle We start by decoupling politics from economic cycles. Many will loudly say it’s not possible. But Italy keeps churning out new governments and its economy still grows. Must every election be about fear? Even a new constitution did not disperse the tensions that accompany every election cycle. More than 56 years after independence, we still can’t manage our politics from grassroots to the national level. Has devolution translated to tangible economic growth in the counties? And why are so many hotels coming up in the counties instead of factories? Closely tied to politics is our attachment to tribes, which has paradoxically...

The African Union expects the single market to boost trade among the 52 out of 55 member states who have signed the pact. The leaders are rooting for removal of intra-trade fragmentation among African Countries to attract small- and large-scale investments. Sunday in Niamey, Niger 52 out of 53 countries signed the AfCFTA agreement and according to AU the free trade pact will rally all the African people to promote the regional economic growth. The leaders are banking on the AfCFTA to create customs unions that will attract investors boosting the already existing eight regional economic blocs half of which have customs unions. The Sunday meeting saw Nigeria and Benin joined the list of signatories, leaving Eritrea as the only member of the African Union that have not signed into the historic accord. Niamey has become the trade zone headquarters for the AfCFTA while Ghana is the secretariat of the trade zone. The trade deal came into force on May 30, after the deposit of the required minimum 22 instruments of ratification by AU member states to the AU Commission. Now a total of 27 countries have deposited their AfCFTA ratification to the AU Commission after five more instruments of ratification including Gabon and the Equatorial Guinea deposited theirs on Sunday. The Chairperson of the African Union Commission said July 7th will be officially celebrated as the Day of African Integration. “July 7 from now on will be officially celebrated as the Day of African Integration in commemoration of today’s historic...

Unctad’s Secretary-General Mukhisa Kituyi spoke with JAMES ANYANZWA about the benefits and potential pitfalls of implementing the AfCFTA. July 7 marks the launch of the $3 trillion African Continental Free Trade Area (AfCFTA). Is it time to pop the champagne? I would advise cautious optimism. The entry into force of the agreement establishing the AfCFTA is a landmark achievement after months of technical work and negotiations, and it should be celebrated. However, some critical issues (notably on tariff schedules and rules of origin) still remain.   The single African market is a great thing, but do you think its implementation will be smooth, given that regional economic blocs have been bogged down by trade disputes and poor implementation of Common Market protocols? It is unlikely that the implementation of an agreement of such breadth and depth will be smooth across the board. Challenges are bound to emerge. As a matter of fact, some have already surfaced in the course of negotiations and are being dealt with. What is important, however, is the need to step up to the challenge and harness the regional market for Africa’s structural transformation. But Africa is not starting from scratch. The experience and lessons learnt in the regional economic communities (RECs) can be leveraged to make the AfCFTA implementation smoother and more effective. One of the key advantages of a bloc like this is job creation. Is there a chance for job seekers from small economies to get employed in the more developed economies? Like many trade agreements,...

The African Continental Free Trade was launched yesterday at the 12th Extraordinary Summit of the African Union in Niamey, Niger. President Paul Kagame described the launch of the operational phase of the African Continental Free Trade Area as a significant milestone for the continent and the African Union. President Kagame said Rwanda was in full agreement of the report by Niger’s President Mahamadou Issoufou on the way forward on the agreement. Among the proposals in the report include catering for the interest of small-to-medium cross-border traders by simplifying trade regimes applicable to them. “We particularly concur on two points. One, the need to cater for small-to-medium cross-border traders, by simplifying trade regimes applicable to them,” he said. Kagame also endorsed the decision to commence trading under the AfCFTA on July 1, 2020. At the summit, the Executive Council designated Ghana as the choice to host the AfCFTA Secretariat. “I agree with the proposal of the Executive Council designating Ghana as our choice to host the AfCFTA Secretariat. I congratulate them as well,” Kagame said. Following the launch of the agreement and in the build-up to implementation, Kagame called on stakeholders to finalise remaining negotiations and operational instruments. “Our task now is to finalise the remaining negotiations and operational instruments in a timely manner,” he said. Among the ongoing negotiations includes Rules of Origin which will determine the eligibility of goods to be traded under CFTA as well as modalities such as protection of infant industries. At the summit, a number...

The sector will however contend with myriad challenges it currently faces which have resulted in exit of some firms from Kenya and the share of the sector’s contribution to the economy declining to just 7.7 per cent last year from 10 per cent in 2014. President Uhuru says there is a raft of measures that his administration is undertaking to prop up the industrial sector and woo more firms to set up production facilities in Kenya as well as increase capacity among those already operating in the country. This would enable the industry to churn out competitively priced products that will meet demand not just for the Kenyan market but also the region. >Already a key exporter of finished products to other East African countries, Kenya is looking to grow the market to include nations outside the East African Community. It expects the African Continental Free Trade Area (AfCFTA) to serve as a key platform to enable it substantially grow the footprint of locally-made products on the continent. The AfCFTA agreement has been ratified by 24 African countries and is expected to be launched in July, opening up trade on the continent. It is aimed at create a single market for goods and services, akin to the European Union, enabling free movement of goods and people. Uhuru said the government would deepen relations that allow the country to export to markets such as North America, Europe and even China. Such include America’s African Growth and Opportunity Act (Agoa) and the...