In a recent study by TMA, the restrictions on movement of people also cut off operations of informal cross border traders who significantly contribute to regional trade. BUSINESS   VIRUS The current outbreak of the coronavirus pandemic continues to threaten the already fragile intra East African Community (EAC) trade, pulling it back by 40%, according to TradeMark Africa (TMA). Already standing at a measley20%, TMA said a further drop in intra-regional trade was first registered in March, following measures undertaken by regional governments to curb the spread of the coronavirus outbreak. Regional governments instituted measure to control the movement of people across borders, after the outbreak, and allowed only the movement of goods. In a recent study by TMA, the restrictions on movement of people also cut off operations of informal cross border traders who significantly contribute to regional trade. Informal cross border traders, who mostly comprise women, contribute approximately 60% to trade across the region's borders. The trade represents produced goods and services, which directly or indirectly do not pass through the regulatory framework for taxation and other procedures set by Partner States. TMA said since the outbreak, most manufacturers across the region have also resorted to focusing on local markets, leaving only agricultural goods and products to swing across the borders. It also noted that: "Due to the current coronavirus pandemic, regional trade has been heavily impacted leading to a rise in NTBs." Prior to the COVID -19 outbreak, intra-regional trade had been projected to grow 5%, driven by...

22 July 2020 (ECA) - At a time when global trade seems so uncertain because of COVID-19 pandemic crisis, a recent paper strikingly highlights that Kenya experienced a significant improvement in exports in early months of 2020 together with the moderation of imports, leading to a marked decline in the trade deficit. The paper published by Brookings and written by Andrew Mold, Senior Economist at UN Economic Commission for Africa and Anthony Mveyange Director of Research at TradeMark Africa used Kenyan trade data published up through May 2020 to provide a preliminary evaluation of the impact of the COVID-19 crisis on regional trade in the East African Community (EAC). According to the paper, the curfews, lockdowns, and cross-border disputes linked to the crisis provoked a sharp decline in intra-regional trade, with a dramatic fall in Kenyan exports to Uganda, Tanzania, and Rwanda. These trends are worrisome because Kenya is the major exporter and importer of the East African Community (EAC), accounting for around 46 per cent of exports and 41 per cent of imports for the whole region. Recent trade evidence from East Africa Kenyan textile exports to the United States and flowers and shipments of vegetables to the European Union were severely affected, largely due to both suspensions of international flights and the collapse of demand in target markets. The paper notes, however, that despite these disruptions, not all supply chains were affected. Kenyan tea exports peaked at just under 58,000 tonnes in April – a record high. Similarly,...

This paper uses Kenyan trade data published up through May 2020 to provide a preliminary evaluation of the impact of the COVID-19 crisis on regional trade in the East African Community (EAC). Paradoxically, given the prevailing pessimism surrounding the prospects for global trade, Kenya actually experienced a significant improvement in exports in the first quarter of the year, together with a moderation of imports, leading to a marked decline in the trade deficit. While the initial shock to Kenyan trade caused by the COVID-19 crisis initially looked dramatic in terms of the declines registered, this paper reveals that i) the shock is not so alarming when seasonality is taken into account; ii) re-exports and imports have been the primary foci of impact; and iii) domestic exports have actually performed extraordinarily well under the circumstances, with incremental growth since 2019. Notably, not all supply chains were disrupted by the crisis, with some Kenyan exports like tea and fruit surpassing levels of years past. Rather, imports have been the principle victim of the crisis, declining by a quarter over the three months since the crisis began (between March and May 2020). Capital goods imports have declined markedly—a trend which, if sustained, could have implications for longterm economic growth. However, the fall in imports of consumer goods could also set the scene for a revitalization of national and regional industry, as local producers step up to fill the void created by the sharp lull in imports. At the same time, Kenya’s EAC neighbors—especially...

Smart24 TV will on July 29 broadcast virtual discussion focusing on how trade and investment in Africa can be fostered post-Covid19. Experts say viewers will get market insights, perspectives and practical tips to help them invest, transform strategy, processes, technology and people to drive growth. The value of intra-trade among East African Community (EAC) partner states increased to $5.98 billion in 2018 from $5.46 billion in 2017, accounting for a 9.4 per cent growth. This could be boosted further but it remains stifled by persistent trade disputes on rules of origin, non-tariff barriers, inadequate value addition to the agricultural sector and competition from other producers and regional blocs that benefit from export subsidies. On average, EAC countries source 6% of their total imports from the region, and supply 20% of their total exports to the region. According to the EAC Trade and Investment Report 2018, formal trade among the EAC partner states largely constitutes of chemicals, textile, iron and steel. Agricultural commodities also form a large portion with significance in food items like rice, maize, sorghum, coffee, tobacco, wheat and other cereals. However, manufactured goods such as cement, petroleum, textiles, sugar, confectionery, beer, salt, fats and oils, paper, plastics and pharmaceuticals are also traded across the Region. At this event, which is being organized by SSCG Consulting Webcast, expect to gain latest updates, perspectives, strategies and best practices as experts discuss investment and business opportunities in the region, trade relations and facilitation issues at both the regional and the continental...

Truck drivers also applauded the interventions the NCTTCA secretariat has put in place so far including the real-time quick response. Stigma along the Northern Corridor and delays at Malaba border crossing point are the biggest challenges facing transit truck drivers. The chairman of Kenya Long Distance Drivers and Conductors Association (LoDDCA), Mr Roman Waema said that truck drivers are not allowed to stop at designated areas in some counties in Kenya such as the Machakos for fear that they will spread the coronavirus. “Sometimes we are forced to drive for over four hours without stopping, going as far as 400km, just because people do not want us to stop in their neighbourhoods,” Waema said. The drivers said that they had been facing stigmatization in different places due to misinformation by the public with some being treated suspiciously even by very close family members. He was speaking during the launch of the sensitization campaign against the spread of COVID-19 and stigmatization along the Northern Corridor when the Northern Corridor Transit Transport Coordination Authority (NCTTCA) did a one week-long exercise of distributing 10,000 masks and reflective jackets to long distance truck drivers. The exercise was carried out in Mombasa and at the weighbridges- Busia, Webuye, Mariakani, Athi-River and Gilgil. Truck drivers also applauded the interventions the NCTTCA secretariat has put in place so far including the real time quick response through a WhatsApp group dubbed “Northern Corridor Stakeholders Forum”. “We appreciate the Northern Corridor Secretariat for their solidarity with the drivers and...

The European Union on Thursday offered to support Kenya fast track results of the COVID-19 testing for the long-distance truck drivers in Busia and Malaba border points. Currently, it is taking longer than is comfortable for these drivers to get their COVID-19 results at the border points connecting Kenya and Uganda. The EU Ambassador to Kenya Mr Simon Mordue said they have come up with a regional electronic cargo driver-tracking system which will help track the COVID-19-status of truck drivers electronically. “In the next two weeks, the App will be up and running and will be linked to all Covid-19 testing Centres across the country. The technology will at the same time make it possible to follow the trajectory of the trucks and help the detection of short-landing,” he said. The EU envoy made the revelation at the Busia One-Stop Border Post where the EU donated equipment including re-usable boots and masks, washing points, hand sanitizers, liquid handwashing soap, disinfectant sprays and protective PPEs to border frontline health workers, customs operators and women organizations in Kenya and Uganda. “The EU through TradeMark Africa (TMA) will also establish safe trade which will allow close space zone for women small scale traders to continue operating their businesses as the border remains closed due to Corona Virus pandemic,” he added. Kenya’s Ministry of Health Chief Administrative Secretary, Dr. Rashid Aman said they will use the App to link up with their laboratory testing systems to facilitate detection of truck drivers’ Covid-19 status at...

The COMESA bloc has developed an online portal for member states to exchange information on availability of essential products within the region as part of its strategy to lessen the impact of the Covid-19 pandemic. According to COMESA Secretary General, Chileshe Kapwepwe, the platform will connect buyers to suppliers of essential goods thereby promoting and fostering intra-COMESA trade. It is a platform largely meant to support regional trade, during the Covid-19 pandemic. Mwangi Gakunga, Head of Corporate Communications at the COMESA Secretariat, on Monday, July 20, told The New Times that the new tool "will enable suppliers in one country link up with buyers in another by uploading the products they have on the platform." Gakunga explained that for it to work, suppliers must be registered companies in their home countries. He said: "They will register on the platform and open an account and this will be vetted by the governmental focal points mainly in the ministry that coordinates COMESA activities who will approve and activate the account or advise otherwise." "This is to ensure the integrity of the companies allowed to post on the platform. Once the supplier account is activated, he or she can post the products on the platform." The platform will also help small-scale cross-border traders and SMEs to have access to market information and will link producers, sellers and buyers. It comes as the regional bloc noted that measures being implemented by member states such as closing borders to prevent the spread of the Covid-19...

NAIROBI, KENYA: The East African Business Council (EABC) has endorsed sports Cabinet Secretary Amina Mohammed for the World Trade Organization’s (WTO) Director-General position. In a statement, the outfit noted that Amina joining the WTO will be timely as Africa is keenly focusing on the African Free Trade Area (AfCFTA). “She is a strong advocate for the actualization of the AfCFTA and has also chaired the WTO’s 10th Ministerial Conference held in Nairobi in 2015, the Dispute Settlement Body and the WTO’s General Council in 2005, her passion for international trade, exemplary strategic leadership, diplomatic and negotiation skills maker her the right candidate for the job,” said Peter Mathuki, CEO East African Business Council. Her success in the position will be a great opportunity for the EAC bloc and Africa towards championing global economic policy to increase the continent’s share in global trade. “The business community in East Africa is assured that Amb. Mohamed will steer the WTO to greater heights. As a former Cabinet Secretary for Foreign Affairs and International Trade of the Republic of Kenya she is bold and proficient, it will be an honour for the continent to have the first African and first woman as the Director-General of the WTO,” said Dr. Mathuki. Mohamed said on Monday she is seeking Washington’s backing and expressed some sympathy with its criticism of the global body as she emerges as one of two reform-minded African female frontrunners. Delegates say Mohamed, a 58-year-old minister, and former WTO chair, is one of...

Paradoxically, the health and economic crisis have shown that the restoration of local production will be achieved through greater trade and economic integration. The post-pandemic period promises to be a moment of opportunity for Africa, that of securing supply by bringing production back to the continent. Yet the risks of supply disruption are not as much linked to a lack of factories in Africa as they are to the concentration of trade. Africa imports 75% of its drugs from Europe, India, and China. First and foremost, securing supply requires greater diversification of suppliers, backed up by trade agreements. Can this be done in a way that benefits African countries? Intra-community trade within EAC Intra-continental trade circuits are more fragile than international circuits. Despite the pandemic, cargo aircraft continue to land in Nairobi, container ships dock in Djibouti and oil tankers leave Port Sudan. Traffic in the Kenyan port of Mombasa is only expected to decrease 2.1% in the first quarter of 2020 as compared to 2019. The problem lies elsewhere. Quality of infrastructure Intra-Community trade within the East African Community (EAC) represents only 20% of its total trade (as opposed to 70% in Europe). Several factors are to blame for this, including the poor quality of infrastructure, complex administrative procedures, low competition in the carrier industry, and a lack of interconnectivity between the various modes of transport. For example, clearing a container takes eight days in Mombasa, less than two days in Mauritius and barely ten minutes in Europe. These differences are even more pronounced...

In Summary The app will follow the trajectory of the truck and detect any smuggling or short-landing. The app is expected to be launched within two weeks. Truck drivers have welcomed a decision by the government to introduce an application through which they can access coronavirus test results. EU ambassador to Kenya Simon Mordue said Friday they are partnering the government to release the app in two weeks. The cargo transporters said on Sunday the app will limit the frequency of travel to Covid-19 test centres to pick their results. They also said the development will hasten the delivery of test results to individual drivers thus reducing the time they spend queuing on the roads. Mark Kibet who plies the Mombasa-Tororo route transporting clinker to the Tororo Cement Industry in eastern Uganda said he was ready to download and use the app. “That is a good decision because that app will help us when our samples have been taken. We will only be returning to our vehicles and wait for the results to come out through our phones,” he said in Amagoro. Results take two to three days and when they are released, drivers have had to travel again to Malaba to pick them, he said. Truck drivers are screened for the coronavirus after every 14 days and it has been cumbersome for them to travel to test centres to collect result certificates. Abdallah Boru who plies the Mombasa-Kampala and Mombasa-Juba routes said developers of the app deserve commendation. It...