The real impact of commerce under a Pan-African deal to establish the world’s largest free-trade area will probably only be seen in three years, according an architect of the pact. While the first trade under the African Continental Free-Trade Area, which could cover a market of 1.2 billion people with a combined gross domestic product of $2.5 trillion is set to start July 1, it will be “very modest,” Carlos Lopes, the former executive secretary of the United Nations Economic Commission for Africa, said in an emailed response to questions. That’s because a road map, laws and support mechanisms to facilitate continent-wide trade has to be finalized, he said. Lopes led the unit that provided technical support to the African Union, which is spearheading efforts to establish the continent-wide deal. Africa lags behind other regions in terms of internal trade, with intra-continental commerce accounting for only 15% of the total, compared with 58% in Asia and more than 70% in Europe. The African Export-Import Bank estimates intra-African trade could increase by 52% within a year of the pact’s implementation and more than double during the first decade. The agreement requires member states to work toward eliminating or lowering tariffs on 90% of goods to facilitate the movement of capital and people, and create a liberalized market for services. Tariff concessions, rules of origin and protocols governing services are still to be agreed on An agreement on tariffs could take time because countries are expected to offer concessions on an individual basis...

FAIDA Mohammed Shaib, like majority of Zanzibar women, had for many years survived as a mere destitute housewife, with literally nothing to count on as her reliable source of earning. But, that was before 2016. The up-and-coming entrepreneur is today an economically empowered lady, traversing the East African region and minting money from her agricultural produce processing business. “I have no problem with the market. I sell my products both in the domestic and export markets. I have just arrived from Rwanda where I participated in trade shows and made good business,” says Ms Mohammed, depicting the successes of the three-year Women Empowerment in Zanzibar (WEZA II) project. Under the Tanzania Media Women Association, Zanzibar (TAMWA-ZNZ) executed project to empower female socially and economically, at least 6,000 rural women were targeted in Unguja and Pemba Islands. The project, which TAMWA ZNZ implemented between 2016 and June 2019 in partnership with Milele Zanzibar Foundation, had the overall objective to reduce poverty and improve social justice in Zanzibar. “I feel economically emancipated today, I process soaps, cosmetics and other products,” testifies Nachumu Juma Smai, another project beneficiary, recalling her gloomy past when she could hardly generate a penny. But, coming from a typical Muslim society, hardworking women in Zanzibar have become victims of societal backlash. “We suffer from public loathing…many members of the public perceive us as bad mannered wives because we don’t stay at home, but I have personally decided to ignore the noises and focus on my income generating activities,”...

Businesses are rooting for capping of the common external tariff at 32.5 percent by East African Community member states. East African Business Council’s CEO Peter Mathuki says the new tariff would be presented during the forthcoming EAC member states summit slated for later this month for ratification. The meeting is also expected to deliberate on admission of the Democratic Republic of Congo and Ethiopia, who have expressed interest to join the trading bloc. However, businesses from EAC member states say they have brokered a deal to cap common external tariff at 32.5% with the proposal expected to be presented during the forthcoming EAC summit in Arusha slated for later this month in efforts to harmonize the tax regime in the trading bloc. The council has called on the member states to expedite in establishing a single regional air space and one network area to further lower the cost of doing business in the region. The proposal by the Democratic Republic of Congo and Ethiopia to join the East African Community trading bloc is at an advanced stage. The forthcoming summit is also expected to handle trade issues between member states. Source: KBC Channel

Importers in East Africa will from July operate under a common Customs bond, which guarantees uniform import duties and taxes across all partner states. Currently, the value of Customs bonds varies from country to country because of the application of different duty rates, valuation and sensitivity of goods. Kenya requires importers of transit goods to secure a Customs bond issued by an insurance company, while delicate or sensitive cargo requires a bank or cash guarantee. In Uganda and Rwanda, the Customs bond is issued by an insurance company with rates based on the taxes charged by the destination country. According to the East Africa Community Single Custom Territory Monitoring and Evaluation Committee, the common Customs bond will reduce the cost of doing business and goods turnaround time. This common Customs bond is expected to be adopted during the Council of Ministers in July as part of the pillar to create a Customs Union. It is meant to create a level playing field for the region's producers by imposing uniform competition laws, Customs procedures and external tariffs on goods imported from countries outside the EAC. The Monitoring and Evaluation Committee met in Mombasa, Kenya to discuss how to tackle the remaining trade barriers. They agreed that enhancing integration of Customs and port functions will ease the seamless exchange of information among partner states. To secure cargo movement in the region, the revenue commissioners from Kenya, Rwanda, Burundi, Tanzania and Uganda, who were in attendance, said they were already implementing cargo tracking...

By :  Mbatau Wa Ngai The recent signing of an amendment to the US-Kenya Air Transport Agreement could increase exports to the American market.This is, however, only if Kenya Airways and the government, which is the airline’s main shareholder, play their respective roles with diligence.Specifically, the amendment allows American all-cargo airlines to fly between Kenya and a third nation without needing to stop in the US, an important right when operating a cargo hub.This gives Kenyan all-cargo carriers reciprocal rights to fly into the US. SEE ALSO :KQ Board appoints acting Chief Executive Officer Judicious exploitation of this right could boost the fortunes of Kenya Airways’ cargo subsidiary while also enabling Jomo Kenyatta International Airport (JKIA) to play its rightful role as the regional hub it was meant to be.The signing of the agreement also gives Kenya Airways a lifeline, which it should use to put its finances in order to return to profitability. Admittedly, the national carrier still requires State support to weather the short-term financial headwinds it is facing due to past missteps.Treasury should realise that a successful and profitable airline is an economic enabler for the country like no other, and allowing the collapse of the national carrier would leave the country at the mercy of other airlines—most of them supported by their governments. SEE ALSO :Public relations firm Gina Din sold But last July’s parliamentary vote to renationalise the airline might not be the way to go until the country slays the dragon of corruption that has...

By : DEUS NGOWI in Arusha AS the government of Tanzania walks the talk in the realisation of industrialisation, the country has been picked to host a high level business convention on industrialisation. The business convention with a theme ‘Private Sector- Led Industrialisation through Sustainable Productive and Export Capacities’ seeks to enhance the country’s competitiveness, comparative advantage and the growth of regional value chains in the East African Community (EAC). It is set to further promote the industrialisation development agenda in the country. Its organisers of the event scheduled for Dar es Salaam late next month are the EAC, East African Business Council (EABC), the Confederation of Tanzania Industries (CTI) and Tanzania Private Sector Foundation (TPSF). Tanzania’s Second Five Years Development Plan has identified automotive, petrol, gas and chemicals, pharmaceuticals, agriculture and agro-processing (cotton to clothing, textiles and garments, leather and edible oil) as priority sectors for industrialisation. At regional level, the EAC industrialisation strategy aims at increasing intra-regional manufacturing exports to at least 25 per cent and the share of manufactured exports relative to total merchandise exports to at least 60 per cent by 2032. EABC Chief Executive Officer, Dr Peter Mathuki, said the convention would be going in the same way as stipulated in the FY DP II. Industrialisation is the allencompassing policy priority guiding the design and implementation of policies and strategies aimed at achieving the objectives of Tanzania’s Five-Year Development Plan from 2016/17–2021/22. “The industrial sector in the EAC contributes about 8.9 per cent to the...

By : EDWARD QORRO in Arusha HEADS of State from the six East African Community (EAC) partners will meet in Arusha later this month for the 21st Ordinary Summit for monetary union matters, among others. The EAC Secretariat has already dispatched invitations to the member countries for the much awaited summit scheduled for February 29. “The summit is still on as planned and we look forward to the full representation and participation of the member states,” disclosed EAC’s Media Coordinator, Mr Florian Mutabazi in a telephone interview with ‘Daily News’ yesterday. Though he would not divulge the agendas to be discussed, Mr Mutabazi hinted that a raft of issues including the envisioned East African Monetary Union (EAMU) will dominate the talks. The meeting of the six EAC leaders could possibly delve on the upcoming election in Tanzania and Burundi, slated for May and October this year respectively. EAC Secretariat’s confirmation on the upcoming Heads of State summit comes four months after the postponement of the initial meeting that was scheduled for November 30 last year, but failed to take place due to lack of quorum. The summit also comes a time when the Regional Economic Community is grappling with lack of commitment demonstrated by some of the EAC member states in remitting their financial obligations to the Secretariat. This has indeed become an Achilles heel to the 20 year old regional intergovernmental organisation of six Partner States, with some of its organs calling for the addressing of the dire financial...

The Government of Tanzania Ministry of Finance has signed a facility agreement with Standard Chartered (SC.com) Tanzania for a US$ 1.46 billion term loan financing to fund the construction of the Standard Gauge Railway (SGR) project from Dar es Salaam to Makutupora. Running approximately 550 kilometres long, the SGR project is one of the country’s biggest projects connecting Dodoma to Dar es Salaam via Morogoro and Makutupora. Once complete, the SGR Rail project will provide a safe and reliable means for efficiently transporting people and cargo to and from the existing Dar es Salaam Port. According to the Tanzania Railways Corporation, it is expected that the railway will address current congestion challenges and decrease freight service charges by 40%, as the railway will be able to haul up to 10,000 tons of freight, equivalent to 500 lorries, per trip. It will also connect Tanzania to Burundi, Rwanda and The Democratic Republic of Congo, DRC, thereby playing a key role in enhancing regional trade. The project has already created more than 8,000 new direct employment opportunities for Tanzanians and has opened up opportunities for the local communities surrounding the project area to access social services such as shelter and food Standard Chartered Tanzania acted as Global Co-ordinator, Bookrunner and Mandated Lead Arranger on the facility agreement that is the largest foreign currency financing raised by the Ministry of Finance to date. The biggest component of financing comes from the Export Credit Agency Covered Facility(‘s) from the Export Credit Agencies of Denmark...

The modern airport will be built in Msalato, 12 km from Dodoma.  The funding package comprises a US $198.6m loan from the AfDB, US $23.52m from the African Development Fund, and US $50m in co-financing from China’s Africa Growing Together Fund. The project is part of a programme to expand the East African nation’s infrastructure. The African Development Bank ( AfDB) has forwarded US $272m loan to the government of Tanzania to construct an international airport in its capital city Dodoma. The project is part of a programme to expand the East African nation’s infrastructure. The funding package comprises a US $198.6m loan from the AfDB, US $23.52m from the African Development Fund, and US $50m in co-financing from China’s Africa Growing Together Fund, which the AfDB manages. “An expanded air transport network in Dodoma, together with the ongoing high-speed railway construction on the central corridor, are necessary infrastructure investments to help unlock and disperse spatial development in the countryside.This will strengthen the city’s potential as a strategic growth pole in keeping with Tanzania’ national development aspirations of fostering shared growth for all the regions,” said Amadou Oumarou, the AfDB’s infrastructure and urban development department director. The modern airport will be built in Msalato, 12 km from Dodoma. It will include a passenger terminal, runway and related infrastructure. The new airport project will take approximately four years to complete. Upon completion it will have a capacity to handle 1 million passengers annually and will have a runway of just over 2km...

In Summary Blow to Kenya as Dar to Kinshasa Standard Gauge Railway makes Nairobi’s new line less economically viable.   The SGR link gives landlocked Burundi and DRC direct access to the Dar es Salaam Port, greatly boosting Tanzania’s Central Transport Corridor.   Kenya had marketed its own SGR as the cheaper and more efficient route for East Africa’s landlocked countries including Burundi and eastern DRC. By EMMANUEL ONYANGO Tanzania has signed an agreement to link its Standard Gauge Railway (SGR) to Burundi and the Democratic Republic of Congo, in a deal that gives Dar es Salaam’s multi-billion-dollar project a major shot in the arm. Transport ministers of the three countries Isack Kamwelwe (Tanzania), Jean Bosco (Burundi) and Roger Biasu (DRC) signed the agreement this past week in the port town of Kigoma. The SGR link gives landlocked Burundi and DRC direct access to the Dar es Salaam Port, greatly boosting Tanzania’s Central Transport Corridor. The development is, however, a blow to Kenya’s Northern Transport Corridor, which had marketed its own SGR as the cheaper and more efficient route for East Africa’s landlocked countries including Burundi and eastern DRC. “This agreement is in line with the completion of a preliminary feasibility study of detail design plans which was successfully done by the consultancy company Gulf Engineering Ltd based in Uvinza,” Mr Kamwelwe told The EastAfrican. The first phase of the construction will start from Uvinza district in Kigoma region in north western Tanzania to Gitega, via Msongati region, in Burundi,...