NAIROBI (Xinhua) -- Kenya is expected to benefit from massive infrastructure projects being implemented across the country and thus become a hub for intra-regional trade in Africa, a new study by research firm revealed Saturday. The study by Frost & Sullivan said mega infrastructure projects are planned for East Africa and are set to create unique opportunities and open new markets in Kenya, Uganda and Ethiopia. "Transport infrastructure has undergone major upgrades over the past 5 years in order to support the high trade demand in the East African region," said Frost & Sullivan Senior Economic Consultant Craig Parker in the study. Kenya is implementing several infrastructure projects including the construction of the first phase of the Standard Gauge Railway linking Mombasa and Nairobi. The project is expected to result in both shorter freight delivery time and lower transportation costs, boosting regional trade. The East African nation is also a major beneficiary of Chinese funded infrastructure projects like superhighways, railway network and seaports. The East Africa’s largest economy has a cordial relationship with China whose benefits are being felt across socio-economic spheres. Chinese investments in Kenya’s infrastructure, manufacturing and mining sectors had ripple effects in the eastern African region. The study, African Infrastructure Tracker: Kenya, reveals that an estimated 55.6 billion U.S. dollars in investment into infrastructure development for Kenya is planned (as of 2015), the majority of which will focus on telecommunications and power generation infrastructure. "The Nairobi Southern bypass, for example, was commissioned in 2012 and is already...

NAIROBI (Xinhua) -- The East African Community (EAC) Member States are fine tuning modalities of setting up a single customs regime in order to promote cross border trade, have officials. Heads of revenue authorities from Burundi, Kenya, Tanzania, Rwanda and Uganda, who met in Nairobi, said that countries have been harmonizing policy and legislative frameworks to fast-track the establishment of a single customs territory (SCT). "The process of establishing a single customs territory in the region has not encountered any hitches and would be completed in three years time," Kenya Revenue Authority (KRA) Commissioner General John Njiraini said in Nairobi. East African Heads of States have approved the uniform customs regime to ease cross border movement of goods and services The regional countries in 2012 commenced the process of establishing a single customs territory as a means to boost cross border trade, revenue collection and ease of doing business. The EAC is targeting the creation of a political federation, a borderless single state made up of the five countries, Burundi, Kenya, Rwanda, Uganda and Tanzania, led by a single president and exercising a single foreign policy. To get the vision of a single state in motion, the Arusha-based EAC Secretariat has been working towards a foreign policy, a common defence policy, a customs union, which is currently in place and the Monetary Union, which aims at a single currency. Njiraini noted that significant ground has been covered since the process of establishing a regional customs regime commenced. "We have covered...

NAIROBI, Kenya, Aug 7 – East African nations are integrating their customs systems to make it possible to have a regional bond for goods in transit. Kenya Revenue Authority (KRA) Commissioner General John Njiraini says the bonds scheme is designed to fast-track movement of goods under customs seals in the East Africa region. Value of customs bonds vary from country to country because of different duty rates and valuation of goods. In Kenya, the current procedure requires importers of transit goods to secure a customs bond issued by an insurance company, whilst ‘sensitive’ cargo such as clothes, wines and spirits, tyres and tubes, shoes, electronic goods, second-hand clothes, food commodities (sugar and rice) require a bank or cash guarantee. The customs bond in Uganda is issued by an insurance company and is cancelled upon presentation of a copy CD-COM duly stamped by customs officers of the post of exit. Rwanda also requires a bond in cash. “The adoption of common external tariffs and the introduction of a regional bond guarantee scheme should solve this problem,” said Njiraini during a regional meeting in Nairobi that discussed the implementation of the EAC Single Customs Territory (SCT) projects. The meeting comes ahead of the forthcoming 11th Northern Corridor Integration Projects Summit, to be held in Nairobi. The one day meeting brought together the Commissioners General of Revenue Authorities from Kenya, Uganda, Rwanda, Tanzania, Burundi and Democratic Republic of Congo to discuss cargo clearance time and costs. The commissioners discussed the implementation of the...

The US is proposing radical changes in Kenya's port cargo handling procedures to help reduce illicit trade and lock out high-risk consignments. The US government wants Kenya to adopt the Cargo Targeting System (CTS) for cargo processing, the two nations said in a joint communiqué following the recent visit by President Barack Obama. The revelation came ahead of a visit to Washington by a senior Kenyan delegation to discuss best practices in port management. "In addition, the United States commits to work with the government of Kenya to explore the possibility of developing a CTS to receive electronic cargo manifest data from shipping lines to target high-risk shipments based on risk profiles," the document released by the White House read in part. The CTS enables port and security authorities to access electronic cargo manifest data in advance and carry out assessment of risks and target high-risk consignments moving through the supply chain. This has a benefit to the international trade community by increasing supply chain visibility and security, promoting fair and effective revenue collection, reducing levels of illicit trade and allowing better allocation of resources. Of late, Kenya has been facing security threats from the Somalia militant group, Al-Shabaab, which has been blamed for recent attacks on civilians and security personnel. There has also been concern about the incessant trafficking of small arms, drugs and contraband sugar worth millions of shillings. Source: All Africa

The launch of the Tripartite Free Trade Area (TFTA) by 26 African countries at the beginning of June brings together the Common Market for Eastern and Southern Africa (COMESA), the Southern African Development Community (SADC) and the East African Community (EAC) and is in line with the long-standing vision of creating an African Economic Union. It is expected that the TFTA will be a building block towards establishing the Continental Free Trade Area by 2017. The TFTA represents a consumer market of about 600 million people and about 58 percent of the continent’s Gross Domestic Product, estimated at US$1.3 trillion. However, Minister of Industrialisation, Trade and SME Development, Immanuel Ngatjizeko, yesterday warned that Namibia needs to increase its industrial capacity to take advantage of the opportunities provided by the TFTA. “Namibia in particular places industrialisation at the centre of its development strategy, hence the need to expand our industrial base is more important now than ever,” said Ngatjizeko during a public seminar on regional and continental economic integration arrangements. He added that his ministry is ready to work with the private sector and Small and Medium Enterprises (SMEs) to ensure that the country’s industrial strategy yields results. Ngatjizeko added that policymakers have realised that market liberalisation alone without industrialisation and infrastructure development does not serve the economic purpose, especially in countries like Namibia whose industrial capacity is constrained and not as competitive as other countries. He said for this reason the TFTA emphasises industrialisation and infrastructure development as strategic pillars...

Kenya and Australia are this year celebrating 50 years of bilateral relations. A number of Australian firms have either invested or expressed interest in key sectors of the Kenyan economy, including mining, education, healthcare and agribusiness. In October 2012, the Australian International Food Security Centre (AIFSC) opened an office in Nairobi to finance applied research for faster agricultural technology adoption across 10 countries in Eastern and Southern Africa. The two countries have also strengthened ties on security, counter-terrorism and piracy, mining exploration and education. The Business Daily’s Allan Odhiambo spoke with John Feakes, Australia’s High Commissioner to Kenya, on the state of Kenya-Australia relations and what lies ahead for the two countries. What is your assessment of Kenya’s socio-economic environment so far? I am very positive about Kenya’s progression because all the factors requisite for development are gradually being addressed. The country’s growth would have been quicker but the promise remains strong. Kenya’s human capital is particularly attractive, especially given the drive its young entrepreneurs have. The geographical placement also places the country in an advantageous position for growth because it’s the gateway to the region. The investment being made in infrastructure development is impressive and will pay dividend in future. What is the cornerstone of Australia’s ties with Kenya? The two nations are relatively young members of the Commonwealth and share a lot in terms of progression lessons. The melting point in our relations is the dynamism we both have to grow the private sector. We have a strong...

A platform to connect farmers to grain buyers in the region was launched in Nairobi, Kenya. The platform, dubbed G-Soko, was developed by a Kenyan-based IT firm Virtual City in partnership with the Eastern Africa Grain Council (EAGC) and the Food Trade Eastern and Southern Africa Organization. G-Soko, the online trading platform will now enable Smallholder farmers in the East Africa to sell their produce at favorable prices. Speaking at the launch of the platform, the Secretary General of the East African Community Amb. Dr. Richard Sezibera commended EAGC for partnering with the Secretariat to implement the EAC Food Security Action Plan, which is the EAC strategy to achieve food security in the region. The secretary general, who was represented by the Director for Productive Sectors Jean Baptiste Havugimana, also hailed the EAGC for the online initiative and pledged 'EAC continued support in automating agricultural crops trading systems and processes to reduce commercialisation cost and all related challenges and bridge the gap between farmers, traders and consumers for increased food security in the region.' Speaking at the same occasion, the Executive Director of EAGC Gerald Masila disclosed that G-Soko was part of a five-year trade enhancement and promotion programme in the region. He said linking rural food production zones in East Africa to urban consumption centres requires a well-functioning regional market and that by adhering to the system, farmers in the region will, among others, be able to access credit while waiting for prices to increase through pledging the electronic...

Barack Obama has called for an increase in intra-African trade alongside a renewed economic engagement with the United States, arguing that countries on the continent can do much more to build links with neighbouring states. "The biggest markets for your goods are often right next door. You don't have to just look overseas for growth, you can look internally... it shouldn't be harder for African countries to trade with each other than it is for you to trade with Europe and America," he said. Obama was delivering a keynote speech to the African Union in Addis Ababa, the first sitting US president to address the body since its foundation in 2001. The speech capped off a five-day trip to Kenya and Ethiopia. According to UN figures, the share of intra-African trade in Africa's total trade over the past decade was only about 11 per cent, compared to 70 per cent for Europe. In response, Obama said that the US would step up efforts to encourage regional integration, building on previous US assistance in modernizing customs and border crossings in the East African Community. The president also highlighted US efforts in battling corruption, tackling illicit capital flows and building power capacity on the continent. Obama praised African countries that have torn down barriers to investment, but argued that much more needs to be done to spark business growth on the continent. "In many places in Africa, it's still too hard to start a venture, still too hard to build a business,"...

A new bill against non-tariff barriers that is awaiting assent by the heads of state of East Africa will add legal strength to the push against trade barriers in the region. A new bill against non-tariff barriers that is awaiting assent by the heads of state of East Africa will add legal strength to the push against trade barriers in the region. According to Jim Kabeho a board member of the East African Business Council, the war against the non tariff barriers has always been left to consensus as opposed to strong legal support. Source: NTV

Direct flights to the US could lower freight costs by an estimated 20 per cent, cargo handlers have said, even as focus stays on the government to comply with the requisite security and safety standards that have delayed the resumption of the non-stop connection. The US Federal Aviation Authority is scheduled to perform a fresh audit on the Jomo Kenyatta International Airport (JKIA) in October after a previous review earlier this year failed to attain the minimum threshold of security and safety performance set by the American regulator. US President Barack Obama, during his visit to Nairobi last month, said there was no definite timeline for the resumption of direct flights between the two countries due to the ongoing audit. Kenya has been implementing a raft of recommendations by the US government to enhance security, among them separation of passenger arrival and departure terminals, clearing the flight path and fencing off the airport. Freighters said resumption of direct flights between the two countries would immensely boost trade through lower charges. “If the US allows Kenya’s bid to have direct flights then we will save up to 20 per cent on our cargo operation cost,” Astral Aviation chief executive officer Sunjeev Gadhia said. “The multiple connections make the trip longer and compromises on on-time performance as there may be connection delays and missed connections, while multiple handling in the hubs exposes the cargo to mishandling that may reduce or degrade the cargo quality,” Jared Oswago, the divisional manager at Siginon Aviation...