WASHINGTON, USA - The United States Trade Representative (USTR) Michael Froman, last week announced new moves to ease trade between the US and the East African Community. “This agreement will help us lift the burdens that trade barriers impose, unlocking opportunity on both our continents,” he said in Washington. According to the USTR, trade of goods between the US and the five countries totaled $2.8 billion in 2014. The agreement also establishes a new five-year, $64 million trade and investment hub in East Africa focused on broadly increasing exports under the African Growth and Opportunity Act (AGOA), while expanding and diversifying regional agricultural trade and food security. Froman said , “Today’s agreement is an important milestone for deepening what has already proven itself to be a promising and impactful partnership." Thursday’s deal will help the African nations further streamline the customs process, meet global standards on food protections and reduce other technical barriers to trade. According to a release from the Office of the Trade Representative, during a summer 2013 trip to Africa, President Obama announced the Trade Africa initiative to promote US.-Africa trade and investment, with the starting point in East Africa. With strides made there, the Obama administration wants to deepen that relationship by knocking down additional trade barriers in the region while expanding the U.S. reach to other African nations. “We see this agreement and all our work with the EAC to date as an important steppingstone, not the final destination,” Froman said. The EAC has been...

ARUSHA, Tanzania, 28 February 2015 / PRN Africa / — Ministers from the East African Community (EAC) have signed a Cooperation Agreement on Trade Facilitation, Sanitary and Phytosanitary (SPS) Measures, and Technical Barriers to Trade (TBT) with the U.S. Trade Representative, Ambassador Michael Froman on 26 February, 2015 in Washington, D.C. The Cooperation Agreement will increase trade-related capacity in the East African region, as well as deepen the economic ties between the EAC and the U.S. This partnership will build on to the EAC's work on customs reforms, which have already resulted in substantial reductions in the time and costs of moving goods across borders within the EAC Partner States. During the signing ceremony Ambassador Froman announced that the United States will look into expanding ‘Trade Africa' beyond the EAC boarders to the rest of Africa. ‘Trade Africa' is U.S. President Barack Obama's initiative to support greater U.S.-Africa trade and investment. “Today's Agreement is an important milestone for strengthening what has already proven itself to be a promising and impactful partnership,” said Ambassador Froman. “This Agreement will help us lift the burdens that trade barriers impose, unlocking opportunities for both our continents,” he said. While a majority of the region's people are involved in agricultural production or processing, the export potential of these products are currently limited. With this new Agreement in place, the EAC can now meet international standards by bringing in U.S. technological expertise to fully implement the World Trade Organization (WTO) Trade Facilitation Agreement on Sanitary and...

The East African Community (EAC) currently consists of 5 countries vis Kenya, Uganda, Rwanda, Burundi and Tanzania. Of these, only two have direct access to the sea, whilst the rest of the three are landlocked and thus fully dependent on the other two to handle bulk imports and exports. As a result of these dependencies, the EAC has established groupings and protocols like the Northern Corridor and the Central Corridor transport routes to handle and advise on logistical issues surrounding the transportation of goods mainly to the ports of Mombasa and Tanzania. The major issue addressed in these groupings is infrastructure. The EAC are currently net importers of goods and the transportation of these from the ports of Mombasa and Tanzania has been the biggest preoccupation hence the regular infrastructure summits like the one held in Kampala and Kigali recently. Because of the bulk of the exports and imports passing through Mombasa and Dar es Salaam, it is important for the road and rail network to be efficient and reliable. This has not been the case and there has been a lot of dependence on the road networks that have been problematic due to the poor condition of the roads, the problems associated with border crossings and dealings with different authorities. In order to address this, member states of the Northern Corridor; Kenya, Uganda and Rwanda and Burundi have been pushing for the establishment of a Standard Gauge Railway (SGR) project to relieve the pressure on the dilapidated and often...

KIGALI, Rwanda – The East African Community (EAC) is looking at developing a regional capital markets infrastructure which is aimed at integrating the region’s capital markets. writes AGNES BATETA. “We will not have a single East African exchange but we do believe we can have an integrated EA capital market infrastructure working with our different regulators, the market participants and our capital markets,” Secretary General EAC Richard Sezibera said during a discussion held during the EAC capital markets conference held in Kigali recently. Sezibera said, “This is an important agenda and one of the areas in which East Africa has moved fast forward and is moving increasingly in the area of harmonization and integration”. “We believe to deepen the capital markets for EAC; we need to make sure that our standards are benchmarked against international standards. We might be developing the regional standards but these must be strongly benchmarked against international standards,” Sezibera said. EAC is aimed at widening and deepening integration among the five member states which include Rwanda, Uganda, Kenya, Tanzania and Burundi. “For the widening part, EAC over the last few years has formed the Customs Union with the Single Customs Territory, it has a common market and the monetary union which was signed in 2013, and a 10-year road map that will introduce in a single currency,” Sezibera said. According to Sezibera, the deepening part of it especially in the common market and the capital markets integration agenda is based on six pillars. “EAC is engaged...

(Reuters) - The United States and five East African countries pledged on Thursday to ease trade flows and set the stage for more U.S. investment, a program that could be extended to other parts of Africa. The agreement commits Tanzania, Kenya, Uganda, Rwanda and Burundi to cooperate with the United States in customs issues, ease red tape at borders, reduce customs wait times and harmonize trade standards. As part of the deal, which has been in the works since 2013, Washington will provide training on food safety, animal and plant health standards and international regulations. "We see this agreement and all our work with (East Africa) to date as an important steppingstone, not the final destination," U.S. Trade Representative Michael Froman said. China's rapid entry into Africa has fueled a rush to the continent by Western and other economies, including India and Brazil, and the region's economy has grown more than 6 percent in the last decade. Trade in goods between the United States and the East African bloc grew by 52 percent to $2.8 billion in 2014, according to federal data. Exports were at $2 billion, while imports totalled $743 million. All five countries currently take part in the African Growth and Opportunity Act, a program that grants African countries duty-free access to U.S. markets. The program is set to expire later this year and the White House has already kicked off an early bid to raise congressional support for a renewal. The East African region could become even...

On the sidelines of the EAC Heads of Summit meeting held in Nairobi, Christabel Ligami spoke to Tanzania’s Minister for East African Co-operation, also the new chair of the EAC Council of Ministers, on the way forward for the regional bloc following recent reports of misuse of funds. ---------------------------------------- The EAC Heads of State Summit in Nairobi did not address much of the agenda; issues were postponed to the next summit in April. Why was this so? The way the Community functions is that decisions have to be finalised at the meetings level conclusively before the presidents pass them. We have meetings at different levels and at each level there are issues raised that require consultations with partner states. For example, for the key agenda item on the alternative financing model for the Community, no final decision could be reached because the matter is still at the partner states level. It is the same for the road map for political federation; partner states are still consulting. We hope that come April we shall have something to table before the presidents. However, this was a special summit to take care of the November summit that was postponed and the key thing was to hand over of the chairmanship to Tanzania which had was not done last year as per the EAC Treaty. So we will see a lot of things emerge in April. The East African Legislative Assembly accounts committee recently released an audit report showing misuse of funds at the...

The duty on cement imported into East Africa has been lowered from 35 per cent to 25 per cent, heralding good news for the construction sector. But manufacturers warn that the resultant price crash could send them out of business and lead to massive job losses. According to a gazette notice of the EAC released last month, apart from the reduction in the common external tariff (CET), cement has also been removed from the list of sensitive products that require protection until domestic industries can compete. Decisions on the CET are made by the East African Council of Ministers. Despite the current 35 per cent duty on cement from non-EAC countries, imports are still largely cheaper than the locally produced commodity. Cement manufacturers fear the latest move is opening a window to cheaper cement imports that are likely to leave them staring at idle capacity and losses. “This will only create unnecessary competition from manufacturers outside the region, leading to an influx of cheap cement imports,” said Ronald Ndegwa, Savannah Cement chief executive. Mr Ndegwa said that the costly business regime in East Africa will render the local firms uncompetitive against rivals who operate in “subsidised economies.” Electricity, which on average makes up 40 per cent of the direct cost of cement manufacturing, is four times cheaper in Asian countries. “Until the cost of production in the region comes down, we still feel that it is unfair to remove cement from the sensitive items list it is likely to put...

The East African Community Council of Ministers has initiated the process of fast-tracking the Non-Tariff Barriers Bill into law. This is expected to compel partner states to eliminate the numerous NTBs that hinder smooth movement of goods and services within the economic bloc. The EAC Elimination of Non-Tariff Barriers Bill, 2015 was passed by the East African Legislative Assembly in January to enable partner states to completely remove NTBs to allow free movement of goods, people and labour as a requirement by Common Market Protocol. Non-tariff barriers have been cited as the biggest threats to doing business in East Africa. While the five EAC partner states have agreed in principle to remove non-tariff barriers by December this year, this largely depends on good faith on the part of the five countries due to the absence of a legal framework. A report on the status of NTBs released last year indicates that last year, the economic bloc eliminated 66 per cent of the non-tariff barriers, enhancing trade. The report, which was released by the EAC Secretariat, showed that 18 NTBs remained unresolved while four new ones were introduced by the partner states. However, 78 NTBs were reportedly resolved cumulatively by the member states. Tanzania, Kenya and Uganda were reported to have imposed the highest number of NTBs during the period under review while Burundi had the least, with Rwanda imposing none. The new and the unresolved NTBs are mostly restrictions imposed on Customs and administrative entry procedures, technical barriers to trade...

Tanzania's tourism sector is bracing for a difficult period as state-run conservation agencies intend to increase their fees despite low tourist figures. Key players in the sector said business is down by 60 per cent due to low arrivals. Nevertheless, the Tanzania National Parks Authority (Tanapa) is set to enforce its new tariffs on concession fees for hotels located within parks, while Ngorongoro Conservation Area Authority (NCAA) also plans to raise its entry fees in April 2015. Tanapa plans to raise its concession fee for each visitor spending a night at a hotel within its parks from $10 to $60 on average. The new tariffs were to be effected in August 1, 2011, but Tanapa could not enforce them after the Hotel Association of Tanzania and Tourism Confederation of Tanzania filed a case in protest at the High Court. However, the High Court issued a verdict in favour of Tanapa in September 12, 2014, directing the state to issue a government notice to allow the parks authority to enforce the new rate. Permanent Secretary in the Ministry of Natural Resources and Tourism Adelhelm Meru is currently in the process of issuing the notice in a bid to give Tanapa the legal power it needs to effect the new tariff. Chairman of the Parliamentary Standing Committee on Lands, Natural Resources and Environment James Lembeli said both Tanapa and NCAA have been losing Tsh26.7 billion ($14.8 million) in concession fees annually between 2011 and 2014. On its part, NCAA plans to enforce...

East African economies are showing promising growth prospects for 2015, but the falling prices of key commodity exports and the region’s mounting debt burden remain a threat. The region’s growth is expected to average six per cent this year, up from about 5.5 per cent recorded in 2014, driven by increased investments in infrastructure, falling inflation and an expected surge in private-sector lending. However, this growth is dimmed by plummeting prices for tea and coffee, the region’s two leading exports, which have reduced export earnings and widened the current account deficit of Tanzania and Kenya. Tea prices have been depressed by oversupply, while poor rainfall has hurt coffee output. In Uganda and Burundi, a supply glut and lower production have seen depressed earnings from tea and coffee. In the 2014 season, Uganda reported coffee exports worth $394 million, representing a 2.3 per cent drop in volume and nine per cent decrease in value from the previous year. Uganda sold its coffee at an average of $1.87 per kg, down from $2 per kg the previous year. In Burundi, earnings from coffee fell to $23.8 million in 2014, from $66.3 million in 2013, attributed to unpredictable weather conditions and a lower-yielding crop cycle. Tea earnings fell six per cent in the first nine months of 2014. Kenya’s tourism sector, one of the key drivers of dollar earnings, contracted by about 14 per cent during the third quarter of 2014, but is expected to make a comeback as the security situation stabilises....