The 172-kilometre Ahero- Isebania highway is set for an upgrade, complete with new service roads at commercial centres along the corridor to help boost trade with Tanzania. The project traversing four counties - Migori, Kisii, Homa Bay and Kisumu- is expected to improve trade in the Lake Victoria basin. The African Development Bank (AfDB) and the government will fund the project, which is a major boost to traders in Kenya and Tanzania who have been struggling with the narrow and worn road. “The rehabilitation of the Isebania-Kisii-Ahero section of the Tanzania-Kenya-South Sudan Corridor will facilitate cross border movement of passengers and freight, and further enhance access to regional markets,” says the environmental and social study report. “The project road condition has deteriorated over the years due to increasing transit traffic on the road. Currently, the road carriageway width measures 4-5m wide, and increasingly is becoming a major constraint for the main economic activities within the Lake Victoria basin.” The report adds that traffic accidents have increased due to the narrow and heavily potholed road condition. Besides the improvement of the main road, the project will also entail upgrading 75km of feeder roads that connect to the highway. These include the Oyugis-Kendu Bay road (19.5km), Nyachenge-Tabaka-Ogembo road (15km), Sondu-Nyabondo road (6km), Oyugis-Gamba road (7km), Suneka-Rangwe road (18km), and Misambi-Ekerenyo road (11km). “The population of Lake Victoria Basin is over four million and up to two million people are directly served by the Isebania-Kisii-Ahero road and the associated feeder roads for their...

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. International navies have recently nabbed large consignments of drugs off the Kenyan Coast, raising fears that the port of...

An online platform that is intended to connect farmers to grain buyers was launched in Nairobi, Kenya. The platform, which has been 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 Organisation. G-Soko is intended to enable Smallholder farmers in East Africa to sell their produce at favourable 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 Mr. 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, Mr. 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...

Director General of the Standards Organisation of Nigeria Joseph Odumodu, discuses how the Africa Standards Organisation under his leadership, is enhancing trade on the continent, he spoke with Crusoe Osagie. Excerpts: As President of ARSO, what stage are you now in terms of harmonisation of standards across the region and the enhancement of intra-African trade? I will like to do some introductions. In 1991 I think, there was what they call the Abuja treaty and it was in that treaty ‎that African countries talked about the creation of Africa economic community. I do recall again that in that treaty, they identified the importance of quality infrastructure in the development of the African continent and there were other issues that they highlighted at that time, pointing out that African countries were not trading with each other enough but trading with other economic communities. What was also identified as a major constraint was the fact that we were already used to the quality of products coming from other continents but apparently, we do not trust each other about the quality of products we were circulating amongst ourselves. ARSO was actually formed about 50 years ago by the Organisation of African Unity (OAU), but I must say that not much was done after the formation of ARSO in terms of using it as a vehicle for creating economic development for Africa. Just as in the case of Nigeria, nobody thought of how we can use standards to develop our economy. Today, at least...

The tax bodies of the region have rolled out a scheme to consolidate gains from local Customs incentives in order to increase import revenues and minimise trade bottlenecks faced by business people while clearing goods. The Authorised Economic Operator (AEO) scheme allows accredited firms to enjoy shorter turnaround times for clearing goods at border points across the region and faster verification checks, according to officials. Local AEO schemes offer faster Customs clearing procedures to gazetted firms within national borders. Leveraging efficiency gains By leveraging the efficiency gains generated by the Single Customs Territory arrangement rolled out in February 2013, regional AEO firms could register Customs turnaround times of one day on certain trade routes compared with the current three-and-a-half days, sources said. Richard Kamajugo, a trade and Customs expert based at Trademark East Africa said: “For example, cargo consignments between Kampala and Katuna border station will take less than a day for beneficiaries.” Over the medium term, businesses should post higher profits due to the cost-saving thus effected. The AEO model is the brainchild of the World Customs Organisation, which offers incentives to importers and exporters for the purpose of improving tax compliance, increasing revenues from Customs transactions and boosting efficiency levels among beneficiary companies. After nearly three years of preparation, 13 pioneer firms were awarded regional AEO status last month, with revenue officials citing delays in resolving tax-related queries concerning selected businesses as a major challenge during the vetting process. Eligible firms were selected from the pool of existing...

Central Corridor member states are finding it difficult to attract private investors to finance prioritised infrastructure projects because of the huge financial outlay and the delayed return on investment involved. This puts the governments under pressure to either finance the projects from their budgets, or mobilise donors to fund the activities. These financing issues were raised last week during the 4th Central Corridor Transit Transport Facilitation Agency (CCTTFA) regional task force meeting to review the Presidential Round Table (PRT) resolutions and finalisation of an implementation plan. “What private investors want is to put money in projects that make quick returns, but projects like railways are long term and this is partly why the private sector is shunning these projects,” said George Rukara, Assistant Commissioner of Water and Rail Transport Regulation in Uganda’s Ministry of Works and Transport. The five Central Corridor member states are Rwanda, Uganda, Tanzania, Burundi and the Democratic Republic of Congo. Unlike Tanzania, the other Central Corridor members are landlocked and any efforts to access to the sea would facilitate trade. Drawing funds from their coffers would strain regional governments given that some have a tight budget for domestic expenditure and the Central Corridor projects have not been included in this year’s fiscal budget. Member states have the huge task of securing funds to finance more than 10 new joint development projects that have been prioritised and will be jointly owned and funded. The projects are to enhance intra-regional trade by lowering the cost of doing business...

The Construction of Mbale-Tirinyi road generated a lot of excitement among the masses in late 1990s. This brand new tarmac road would provide a direct and faster route to Mbale bypassing the longer and busier, Jinja – Tororo – Mbale route. This road was envisaged to solve the problem of transporting foodstuffs and other commodities from the eastern part of Uganda to markets in the central part. However, some of the locals found a different use for the beautiful tarmac road, drying cassava. This has continued to date. This sad fact is one of the many activities happening on the many new multi-billion road infrastructure investments across the country. There is barely any meaningful economic boom coming out of some of the roads, remember that have been built on borrowed funds and tax payers’ money. Why is this so? Analysts believe the regions need to be supported in commercial agriculture to realize the benefits of such infrastructure. This may take some time though. It is predicted that the same could happen to Standard Gauge Railway (SGR) arguably, the country’s major infrastructure project since independence. The US $3.2 billion project will be funded with loan from Chinese Exim bank. Part of the funding is from the infrastructure levy of 1.5% on all imported goods. Analysts believe, the project may turn out to benefit more of Kenya and the Kenyan manufacturing sector which is said to be advanced than any of the other East African Countries (EAC). Could this be the reason...

Policies to Maximize the Gains of Trade Opportunities for the Poor, and Minimize the Risk This important report reviewed here was prepared by the World Bank which we hope will receive the due consideration it deserves considerable attention and study in the formulation of new development strategies in the future. Further progress in the Doha negotiations, and in particular achieving a substantive outcome on agriculture, is necessary to increase the effectiveness of trade in reducing poverty. The agriculture sector, which employs most of the poor, will continue to play a key role in lifting people out of poverty. Its role could be strengthened if more was done to remove remaining obstacles to agricultural exports. Tariffs and subsidies are particularly high in the agricultural sector and anti-competitive behaviour in some segments of the supply chain can make it particularly hard for the poor to benefit from trade participation. The increasing importance of supply chains in production has highlighted the linkages between the agriculture sector on one side and the services and manufacturing sectors on the other, showing that progress in removing obstacles to trade ideally should occur simultaneously across all sectors. In the long run, the capacity to leverage agriculture for reducing poverty will depend on achieving continuous improvements in productivity, reducing the costs to trade in agricultural goods, reducing tariffs on imports and key intermediates such as fertilizers and agricultural machinery, and improving access to a range of services that are key inputs in the production chain. The capacity to...

Eastern Africa Grain Council (EAGC) has launched G-Soko Platform, an online trading platform that will link smallholder farmers to grain buyers through a structured market mechanism. The platform was officiated by the East African Community’s Secretary General, Richard Sezibera. The G-Soko platform is developed by the Eastern Africa Grain Council (EAGC) in partnership with Food Trade Eastern and Southern Africa, and Virtual City, a leading mobile software solutions firm supporting the supply chain and agribusiness industry in Africa. This is through a five year trade enhancement and promotion programme that aims at encouraging trading in regional staple food markets. The UK through DFID Africa Regional Department has invested £35 million in the Food Trade Eastern and Southern Africa programme to stimulate the regional grains market through partnerships with private companies and policy influencing. Executive Director of EAGC, Mr Gerald Masila, said, there is urgency to expand regional food trade due to the exponential growth of staple food imports. “Linking rural food surplus production zones in Eastern Africa to major deficit urban consumption centres requires a well-functioning regional market. We wanted to address this deficiency but also do it in a way that is inclusive and effective. This is why we developed G-Soko; a market transaction platform that will enhance food trade across borders, and contribute towards making trading more transparent,” he said. The platform performs a structured trade function that integrates the entire grain trade from farm to market. Through G-Soko, farmers are able to aggregate their produce through a...

The tax bodies of the region have rolled out a scheme to consolidate gains from local Customs incentives in order to increase import revenues and minimise trade bottlenecks faced by business people while clearing goods. The Authorised Economic Operator (AEO) scheme allows accredited firms to enjoy shorter turnaround times for clearing goods at border points across the region and faster verification checks, according to officials. Local AEO schemes offer faster Customs clearing procedures to gazetted firms within national borders. Leveraging efficiency gains By leveraging the efficiency gains generated by the Single Customs Territory arrangement rolled out in February 2013, regional AEO firms could register Customs turnaround times of one day on certain trade routes compared with the current three-and-a-half days, sources said. Richard Kamajugo, a trade and Customs expert based at Trademark East Africa said:“For example, cargo consignments between Kampala and Katuna border station will take less than a day for beneficiaries.” Over the medium term, businesses should post higher profits due to the cost-saving thus effected. The AEO model is the brainchild of the World Customs Organisation, which offers incentives to importers and exporters for the purpose of improving tax compliance, increasing revenues from Customs transactions and boosting efficiency levels among beneficiary companies. After nearly three years of preparation, 13 pioneer firms were awarded regional AEO status last month, with revenue officials citing delays in resolving tax-related queries concerning selected businesses as a major challenge during the vetting process. Eligible firms were selected from the pool of existing local...