We are sometimes poor students of the lessons history teaches us. By the time the East African Community (EAC) collapsed in 1977, it had become clear that the political and economic philosophies of its member nations had become unsustainably divergent. This held back countries like Kenya that had chosen to implement market-led economic policies while Tanzania placed considerably more importance on a state-led socialist model of development. It had also become clear that the 'Community' was a club of presidents and not necessarily a genuine community of the peoples of Kenya, Uganda and Tanzania. It was thus that a good idea was often undermined by differences between leaders that were some utterly irrelevant to their citizenry. Over the past few years, we have seen a renewed drive at regional integration in East Africa. The underlying rationales, for example, of uniting the region's peoples into a larger market and doing away with the impediments to trade and commerce are entirely laudable. However, we seem determined to make some of the mistakes that brought us to grief in the 1970s. For East African unity to succeed, we need to learn the lessons of our own history but also make an effort to appreciate the kind of painful economic problems the more mature democracies and markets of the European Union is facing even as we speak. They have been in crisis management mode since the housing market crashed in 2007. The idea of a single currency is particularly premature. Indeed, experience shows that...

As part of their overall push to better integrate the region and ease trade barriers, East African leaders are spearheading a campaign for heavy transportation infrastructure investment into the region. Yet ambitious projects like the Standard Gauge Railway (SGR)— proposed to link up Uganda, South Sudan, Rwanda and Burundi with Kenya’s Mombasa port—chug along slowly, particularly after controversy surrounding the project’s procurement contract has halted the rail’s progress into Uganda. The results of the Ugandan Government’s probe into the technical capacity of the China Civil Engineering Construction Corporation (CCECC) and China Harbour and Engineering Corporation (CHEC) are expected to be released soon, after a committee visited the contractors in China themselves and examined similar rail projects in Ethiopia. Awkwardly for the project’s progress, Kenyan Government officials reportedly refused Uganda’s request for a similar examination—despite the Standard Gauge Railway project starting in Mombasa. Meanwhile, a series of highway renewal projects in the region have picked up momentum, perhaps for their relative simplicity compared to the construction of a brand new railway. Speaking at a recent event in Dar es Salaam as part of the Central Corridor Initiative, Rwandan President Paul Kagame delivered an appealing sales pitch to roughly 350 investors. “East Africa is a good bet for investors who have come to appreciate the good prospects before everyone else does,” Kagame said. The initiative is a multi-modal trade and transport pathway through Rwanda, Tanzania, DRC, Burundi and Uganda. Though he noted that “no investment is risk-free, all the positive trends and...

Kampala. The East African Community (EAC) Secretariat is set to introduce 5,000 new standards to ease the movement of goods and services. Some of the new standards include seeds standards on maize, soya beans, sunflower, sorghum and groundnuts. Such standards will help address challenges of fake seeds in the market when implemented by producers and government. Other standards will be on sugar and sugar products such as chewing gum, liquid glucose used in industry, molasses, sugarcane and sweets. These will help facilitate trade in the region. Experts say the new standards could be an answer to the puzzled private sector whose products have been traded for more than 10 years but have no national standards. EAC Secretary General, Dr Richard Ssezibera, said: “Currently, EAC has 1,500 standards and we are bringing on board 5,000 more. We urge member states to domesticate them at the national level.” Missing national standards However, absence of national standards has hindered highly demanded products from enjoying the regional market. The products mostly affected are ladies’ beauty products and the companies which have gone through this trial are Movit and Samona. Mr Emmy Musasirane, the Movit director, in his submission, said: “We want the authorities to come up with provisions within the law to address the issue where a standard is not harmonised but a product has been in trade the country of origin for more than 15 years.” He called for a special consideration which is acceptable by the other partner states, “We have written...

Kenya has for the first time bought more goods from the United States in one year than it did from the whole of Africa, underlining growing commercial ties that are expected to deepen with the recent thawing of relations and President Barack Obama’s visit in July. US exports to East Africa’s largest economy rose to Sh168 billion last year compared to the Sh146 billion worth of goods and services that came from Africa, according to data from the Kenya National Bureau of Statistics (KNBS). At Sh146 billion, the value of imports from Africa dropped marginally even as the value of goods and services from the world’s largest economy tripled. The exponential growth of US exports to Kenya happened despite the Kenyan President Uhuru Kenyatta standing out as a leading advocate of intra-Africa trade who has made a series of trade promotion trips across the continent since coming to office in 2013. “The value of imports from South Africa contracted from Sh70 billion to Sh63 billion in 2014. The value of imports from Mozambique and Nigeria also dropped by 60 per cent and 56 per cent respectively,” said the KNBS in this year’s economic survey report. Kenyan exports to Africa rose by four per cent to Sh241 billion, supported largely by increased purchases by Ethiopia, the Democratic Republic of Congo and South Sudan. The KNBS data shows export volumes to Kenya’s largest market, Uganda, dropped by seven per cent while trade with Somalia also contracted by Sh3.7 billion. “The biggest reason...

THE East African Community is facing pressure to relax restrictions that make it difficult for the European Union to export manufactured and agricultural goods into Kenya, it emerged yesterday. The Kenyan-led EAC Economic Partnership Agreements negotiating team however maintained it will not yield to pressure, saying relaxing the restrictions on EU's exports would kill the two struggling sectors which are the backbone of EAC's economy. “The EU's move to seek elimination of export taxes will kill agriculture and industrialisation in the EAC,” said Joseah Rotich of the Ministry of Foreign Affairs and International Trade during a roundtable meeting organised by the Institute of Economic Affairs. He said the exclusion of some products from liberalisation under the EPAs is aimed at safeguarding agriculture, industry and Kenya's market interest in the five-member trade bloc. The EU wants EAC to relax export taxes for its agricultural products, wines and spirits, chemicals, plastics, wood-based paper, textiles and clothing, footwear, ceramics, glassware and base metal and vehicles. “I fail to understand why EAC is protesting about a possible inflow of goods from the EU yet they are not talking about the huge amount of manufactured goods imported from India and China which have continued to hurt the local manufacturers,” EU trade and communications counselor to Kenya Christophe De Vroey said at the forum. He said the EPAs negotiations that were concluded in October 14 last year offer the liberalisation of 82.6 per cent of the EAC market for the EU imports within a period of...

South Africa Reserve Bank governor, Lesetja Kganyago lauded the continent for its abundant resources while making his opening remarks at the SWIFT African Regional Conference in Cape Town. With the world’s 60 per cent of arable land and mineral resources, the governor said Africa was blessed with an abundance of resources critical for regional growth. Kganyago urged the region to promote more regional trade and improve transacting systems so as to curb the easy flow of ‘dirty’ money and mechanism that fund terror activities. “If you do not avail efficient and affordable cross border remittance system people will rely on the alternative which will not help in abating dirty money and terrorism,” Kganyago said. Kganyago however said several regions have enacted a number of initiatives to making transacting easier which he said was positive for the continent. “Boosting trade within the continent should take centre stage,” said the South African Reserve Bank governor. “The challenges the continent is facing are far outweighed by the opportunities,” said Kganyago adding that the ongoing regional integration taking place was a move in the positive direction. He also urged the region to make collaborative efforts in ensuring that system are synchronised as there was so much duplication of roles by many bodies. At least 410 participants are part of the annual SWIFT conference with 38 speakers expected to address the conference. This year’s conference is being held under the theme; Africa- seizing the opportunity. Source: CNBCAFRICA.com

Many African countries are growing at a very positive pace though there are still challenges with inclusiveness, this is according to Mina Baliamoune, Professor of Economics at the University of Florida. The comments were made at SWIFT's African Regional Conference in Cape Town. Baliamoune also warned that transformation was a long road but said the right ingredients within the region were there. “Rwanda, Kenya and Ethiopia are also making inroads,” said Baliamoune. “The right policies are in place in most of the countries especially in macro-economic policies. There are a lot of improvements in the continent especially if one looks at the World Bank’s Doing Business Index.” Foreign Direct Investment Baliamoune said infrastructure remained one of the challenges in most countries which discourage not only foreign direct investments but even local investments. “Education with a focus on skills should be one area where most governments should invest and this should be coupled with inclusiveness of groups should be at the centre of the African story,” added Baliamoune. Baliamoune said post-2015; the world will focus on sustainability of the MDGs. “If we transform Agriculture, for me that will be a huge step towards real transformation in the continent. Skills transfer is critical to ensuring real transformation in the continent.” Baliamoune said Africa does not lack ideas, the challenge that remains is capital. 2015, a watershed year for Africa Lyal White from the Gordon Institute of Business Science said structural challenges need to be addressed in the continent. The Gordon Institute of...

That’s because, according to government statistics, Tanzania’s port of Dar es Salaam accounts for over 60 per cent of Rwanda’s external trade with the balance coming through the Kenyan port of Mombasa. You probably also wonder why your supplies are relatively expensive; that’s because as a landlocked country (LLC), the final price of an imported commodity, to a fair extent, depends on the cost of transporting goods from the port to their stores. Recent international trade studies have found that transport related costs account for about 30 to 40 per cent of the prices of goods in landlocked countries such as Rwanda, a factor that negatively, affects such countries’ competitiveness. As a country with a low local manufacturing base, Rwanda heavily relies on imports to keep its citizens supplied and, according to statistics from National Bank of Rwanda (BNR), total imports in 2014 rose by 6.8 per cent to US$2,399.3 million. It currently costs over US$4000 to transport a container from the port of Dar es Saam to Kigali, according to traders and this cost impacts on the final price that the consumer pays for a commodity. Rwanda has to continuously engage countries like Kenya and Tanzania to ensure its traders are well facilitated to clear their goods from the ports to Kigali. Integration helps However, the fortunes of East Africa’s landlocked countries have started taking a positive turn as the story of the region’s integration process adds more chapters; the benefits are envisaged to be felt, first by traders,...

The Northern Transport Corridor in East Africa, extending from the port of Mombasa in Kenya and serving the hinterland countries of Uganda, Rwanda, Burundi, Eastern Democratic Republic of Congo (DRC) and South Sudan, is the busiest trade and transport corridor in East Africa handling the bulk of the region's regional and international trade. While there have been major improvements in transport infrastructure for the corridor, it still faces challenges of road accidents due to long driving distances. Being a busy transit corridor, it is also prone to externalities and risks such as the spread of HIV/AIDS and other illicit activities. The other major transit corridor in East Africa, the Central Corridor, faces similar challenges. To address these challenges, among others, the countries of the region have adopted the Japanese Michi-no-Eki (Road Side Stations) concept. The Road Side Stations (RSS) will provide four clusters of services: rest space for drivers and passengers alike (hotels, restaurants, recreation); information space (ICT services, banking, money transfer, etc.); specialized services (medical, wellness, counselling, training, safety education, etc.); and linkages into local economies (to support small business development). The study carried out by the Spanish Consulting firm, TYPSA, identified 144 potential RSS sites along the Northern Corridor out of which 67 are deemed viable. The key Northern Corridor road route covers a distance of about 2,000 kilometres from Kenya through Uganda, Rwanda and Burundi. But the Corridor also has extensions to Eastern DRC and South Sudan. Of the 67 RSS's, 22 are in Kenya, 27 in...

East Africa bloc sends delegation to Burundi, seeks to resolve crisis DAR ES SALAAM, May 5 (Xinhua) -- The East African Community (EAC) on Monday sent a delegation of four foreign ministers to Burundi in hope of helping resolve the ongoing political crisis triggered by President Pierre Nkurunziza's bid for a third term, a statement has said. The political crisis in Burundi should be resolved by respecting the country's constitution and electoral laws, the statement quoted Tanzanian President Jayaka Kikwete, who is also chairman of EAC, as saying. "I am also appealing to the international community to save Burundi from degenerating into chaos," he was quoted as saying. Kikwete has sent foreign ministers from Tanzania, Kenya, Uganda and Rwanda to Burundi on a fact finding mission, adding that after the mission completes its task, he will convene an emergency summit of heads of EAS member states to discuss Burundi's political situation. EAC includes Tanzania, Kenya, Uganda, Rwanda and Burundi. Mindi Kasiga, spokesperson for Tanzania's foreign ministry, said the mission would hold talks with a wide range of political parties in Burundi. Protests have escalated since April 26 -- one day after Nkurunziza was nominated by the ruling CNDD-FDD as its candidate for the June presidential election. The opposition says his re-election bid violates the constitution which only allow the president to be elected to two terms in office. However, the president's supporters say his first term doesn't count as he was appointed by parliament in 2005 after the civil war...