For sure, the signing of the Kigali Declaration on African Continental Free Trade Area (AfCFTA) in March 2018 by African heads of state and government marked a significant shift in expectations by Africa’s business community, among others, for Africa’s future economic growth and development. The declaration introduced the enhanced intra-African trade, achievable through AfCFTA as the sure way of achieving the much elusive sustainable economic development, employment creation in member states and most importantly, reversing the declining economic growth and development trend in the continent. Indeed, over the past 15 or so years, most countries in Africa experienced have sustained economic growth, with the rates often exceeding five percent a year. Between 2000 and 2010, the continent achieved average real annual GDP growth of 5.4 percent, adding $78 billion annually to the GDP (2015 prices). This growth indeed inspired optimism around and about the continent’s socio-economic prospects and in its ability to deliver better socio-economic welfare gains to the people. However, this was not the case. Between the years 2010-2015, Africa’s economic growth slowed down. Growth dropped to an average of 3.4 percent per year thus sending shockwaves through leadership of Africa and the entire business community. Despite this decline in the performance of the mentioned economies, the rest of Africa economies were able to maintain stable growth rates in general. Nonetheless, African economies amid many internal and external shocks have been resilient. According to the World Bank Review (2018), growth in sub-Saharan Africa is estimated at 2.3 percent for...

The establishment of a railway link between Uganda and Kenya is expected to reduce the cost of commodities through reduced transport expenses. In 2017,Uganda and Kenyan governments embarked on a joint initiative to improve trade between the two countries beginning with establishment of a one border post in Malaba that has seen tremendous improvement in clearing of goods and persons. Yet there are still some bottlenecks at the border . The minister for Works and Transport Monica Azuba Ntege said the two governments have finalised talks to enable the move goods direct from Mombasa To kampala by rail. According to the plan, goods will be transported using the standard gauge railway from Mombasa to Naivasha where they will be shifted to the meter gauge through Malaba as compared to the past where goods were transported by trucks. She revealed that the Kenyan government has offered Ugandan land in Naivasha to establish a container port. The two governments also committed to revamp the old meter gauge railway on either side to Naivasha where it will be connected to the standard gauge railway. Yet like any other development, using the railway to transport goods will translate into reduced business for truck owners and drivers and could lead to unemployment. The MP for Tororo county Fredrick Angura appealed to government to develop coping mechanisms for those whose livelihood will be affected by the new developments. Source: Nile Post

The East African Community (EAC) summons for extended support from Canada, one of the leading development partners to Africa. The community is specifically pressing for assistance in the infrastructure and trade sectors to help it gain its intergrated agenda. Mr. Liberat Mfumukeko, the secretary general said, "There is an urgent need to upscale the EAC-Canada relations as well as Canada's support". He made the call when he met the Canadian High Commissioner to Tanzania, Ms Pamela O'Donnell, who is aslo accredited to the EAC. The Envoy was briefed, during the meeting at the community headquarters, on the latest milestones recorded in the four intergration pillars. They aslo conferred on Canada's support to the African Continental Free Trade Area (AfCFTA) and the Burundi peace process. The meeting stressed the need for the two sides to deepen cooperatin to speed up the EAC regional intergration initiatives through speedy implementation of projects. Ms O'donnell reaffirmed her country's commitment to support the EAC, saying regional economic groupings were key in boosting regional and international trade. Canada joined a host of donor countries with full diplomatic representation at the Arusha-based EAC in 2017. When Ms O'Donnell predecessor presented his credentials, the two sides stressed cooperation in trade, agro-processing and investment. Although it trails, the European Union, Germany and the United States, Canada has featured in investment flows in gas, oil and minerals projects to EA. One of them is the Canadian-supported five year project aimed to push for law reforms in the oil and gas...

The African Continental Free Trade Area (AfCFTA) isn’t simply a ‘Free Trade Agreement’; it’s about establishing a unified continental market with 1.2 billion potential customers and where the private sector is a major engine to make it happen. This was the tone from the discussions of the meeting held on 25 April 2019 in Arusha about how the East African Private sector including Small and Medium Enterprises (SMEs) could benefit from the AfCFTA. The one-day meeting, organized jointly between the East African Business Council (EABC) and the UN Economic Commission for Africa (ECA), convened close to 40 key players from the region’s private sector. The office for Eastern Africa of ECA estimates large potential gains from the AfCFTA, including an increase in intra-African exports of Eastern Africa by nearly US$ 1 billion and job creation of 0.5 to 1.9 million. “Together African economies have a collective GDP of 2.5 trillion USD, making it the 8th largest economy in the world. That makes the continent much more attractive to investment, both from within and from outside the continent,” said Andrew Mold, Acting Director of ECA in Eastern Africa. “This should encourage business people to take advantage of AfCFTA and make the investments necessary to sustain economic growth and create employment”. Nick Nesbitt, Chairman of EABC, emphasized the importance of the continent having a clear vision to put an end to the fragmentation of the internal market. “I really applaud everybody who has involved in creating the AfCFTA because their vision is the...

A key component of Kenya’s foreign policy is predicated on developing strong bilateral agreements that open foreign markets to receive Kenyan farm produce. Indeed, only a few weeks ago, President Uhuru Kenyatta’s successful State visit to Mauritius saw the Indian ocean island country lift a ban on several Kenyan agricultural products that included avocado, baby carrots and broccoli. Even more recently, President Kenyatta’s trip to China secured access to export frozen avocado to the second largest economy in the world. While these bilateral agreements are commendable, their long-term viability will largely depend on Kenya’s ability to export competitively. Therefore, much effort should be directed towards policies that support a strong export strategy. Indeed, during President Museveni’s State visit to Kenya, Kenyans were shocked to find out that much our milk and eggs come from Uganda, which has a much lower cost of production. It therefore follows, that to be a strong exporting nation, we must address the issues that contribute to high cost of production in Kenya. To start with, the litany of taxes that have been loaded onto crucial items like animal feed raw materials, have proved to be a major obstacle to the development of the agriculture sector leading to meagre earnings. While it is understandable that government needs to raise much needed revenue to service our significant public debt, we must be careful that we don’t kill the goose that lays the golden eggs. Agriculture contributes to more than a third of our economy while also creating...

It’s a great privilege to be here and above all a great privilege to have the opportunity for the last hour and a half to meet some of you and to learn from you. I think if there’s one theme that is central to the way that Britain thinks about itself in the world in the future, it’s the theme of humility, the theme of listening to other people, learning from people, working with other people. And I think this is particularly true when we come to probably one of the most difficult intractable and exciting problems in the world, which is the question of unlocking the potential of the African economies. When we talk about economies in Africa – and many of you will have been to these conferences all the time – there is a very strange sense that you lurch from an incredibly optimistic positive vision of where Africa’s going, to suddenly going to the absolute opposite of people being very, very gloomy. And I don’t want to repeat the cycle, but clearly in that tension between these two principles, between the incredible potential of Africa and people’s sense of frustrations, is something there in the centre of this problem which needs to be unlocked. And part of that problem is the question of how you unlock finance and how you unlock money in the centre of those economies. The big picture I don’t want to bore you with because you have heard these ten thousand times...

Kenya on Wednesday called on African countries to embrace mutual recognition agreements for product standards to help spur intra-Africa trade. Betty Maina, principal secretary in the ministry of trade, industry and cooperatives, told an international standards forum in Nairobi that lack of harmonized standards constitute huge non tariff barriers to cross border trade. “Mutually accepted standards for products and services across Africa will reduce the need for duplication of testing when importing and exporting and thus greatly facilitate intra-Africa trade,” Maina said during the 34th International Organization of Standardization (ISO) Committee on Conformity Assessment (CASCO) plenary meeting. She told a two-day event that brought together over 130 delegates representing the ISO member states that mutually accepted standards will help make conformity assessment activities as uniform as possible across industries and the world. Maina noted that conformity assessment plays a vital role in the Kenyan economy because it involves a set of processes that show the product, service or system meets the requirements of a standard. “It provides a tool for managing compliance and providing an objective and defensible means to implement standards thus enforcing national health, safety and environmental legislation,” she added. The Kenyan official noted that on the basis of standards, the East African Community (EAC) has an agreement of mutual recognition of certification marks. Eddy Njoroge, president-elect of ISO, said that the world is getting widely and deeply interconnected making it intimately interdependent, at an alarmingly rapid rate. “As a consequence, standards and conformity assessment have become not...

The Economic Insight: Africa report provides a snapshot of East Africa, Central and West Africa, Franc Zone, Northern Africa and Southern Africa's economic performance. According to the report; East Africa is expected to remain the strongest growing region with a 6.3% economic expansion this year. Ethiopia, Rwanda, Tanzania and Uganda are all expected to record real GDP growth above 6% this year, largely due to infrastructure investment and the expansion of financial and telecoms services. African economic growth has in general been driven by public infrastructure investment and the expansion of services to a largely underserviced population. However, financial technology (FinTech) is increasingly receiving attention from both private and public sector, facilitating innovation in other sectors of the economy and allowing African nations to leapfrog more traditional infrastructure. "African economic growth is currently driven mostly by traditional sectors, However, FinTech has the opportunity to leapfrog other key drivers and to foster inclusive development. But this can only happen if it is managed properly," says Michael Armstrong, Regional Director, ICAEW Middle East, Africa and South Asia. How the FinTech industry shaping Africa's future Almost one-third of total funding on the continent was raised by fintech start-ups in 2017. This can be supported by the fact that 60% of all mobile money accounts globally can be found in sub-Saharan Africa (SSA), according to an Ecobank study. The FinTech sector is set to show strong growth over the medium term, from roughly $200m in 2018 to $3bn by 2020. The majority of these investments have...

EAST African region will continue to lead other regions in Africa in terms of economic growth thanks to infrastructure investment and the expansion of financial and telecoms services, an Institute of Chartered in England and Wales (ICAEW)’s latest report says. The report which paints a rosy picture of growth in the region says East Africa is expected to remain the strongest growing region with a 6.3 per cent economic expansion this year. Ethiopia, Rwanda, Tanzania and Uganda are all expected to record real GDP growth above 6 per cent this year, largely due to infrastructure investment and the expansion of financial and telecoms services. African economic growth has in general been driven by public infrastructure investment and the expansion of services to a largely underserviced population. However, financial technology (FinTech) is increasingly receiving attention from both private and public sector, facilitating innovation in other sectors of the economy and allowing African nations to leapfrog more traditional infrastructure. Michael Armstrong, Regional Director, ICAEW Middle East, Africa and South Asia said “African economic growth is currently driven mostly by traditional sectors, However, FinTech has the opportunity to leapfrog other key drivers and to foster inclusive development. But this can only happen if it is managed properly.” Almost one-third of total funding on the continent was raised by fintech start-ups in 2017. This can be supported by the fact that 60 per cent of all mobile money accounts globally can be found in sub-Saharan Africa (SSA), according to an Ecobank study. The FinTech...

A key component of Kenya’s foreign policy is predicated on developing strong bilateral agreements that open foreign markets to receive Kenyan farm produce. Indeed, only a few weeks ago, President Uhuru Kenyatta’s successful State visit to Mauritius saw the Indian ocean island country lift a ban on several Kenyan agricultural products that included avocado, baby carrots and broccoli. Even more recently, President Kenyatta’s trip to China secured access to export frozen avocado to the second largest economy in the world. While these bilateral agreements are commendable, their long-term viability will largely depend on Kenya’s ability to export competitively. Therefore, much effort should be directed towards policies that support a strong export strategy. Indeed, during President Museveni’s State visit to Kenya, Kenyans were shocked to find out that much our milk and eggs come from Uganda, which has a much lower cost of production. It therefore follows, that to be a strong exporting nation, we must address the issues that contribute to high cost of production in Kenya. To start with, the litany of taxes that have been loaded onto crucial items like animal feed raw materials, have proved to be a major obstacle to the development of the agriculture sector leading to meagre earnings. While it is understandable that government needs to raise much needed revenue to service our significant public debt, we must be careful that we don’t kill the goose that lays the golden eggs. Agriculture contributes to more than a third of our economy while also creating...