TradeMark E.A and FSD Africa have partnered to launch a ground-breaking report on the trade finance landscape in East Africa and the Horn of Africa region. The report titled ‘Trade Finance Landscape in East Africa and Horn of Africa: Barriers, opportunities& potential interventions to drive uptake’ has highlighted limited access to trade finance as a key barrier hindering the region from playing a more significant role in global commerce. Whereas Africa comprises for 17% of the global population for instance, it only accounts for just 1.8% of global trade exports and 2.1% of global trade imports as per 2018 data. Of all sub-regions of the continent, East Africa continue to post the lowest total export trade in goods and services compared to other sub-regions, demanding concerted actions by all actors. Speaking during the launch of the report TradeMark CEO Frank Matsaert noted that the report provided a good starting point in tackling key challenges limiting the regions performance in global trade ‘The low intra-regional trade in Africa is because trading activities across the continent are inhibited, For SMEs in particular by limited access to finance but also due to high export costs, political instability, poor infrastructure and high taxation’ he observed. The study focussed on three priority sectors namely, agriculture, construction and textiles& garments and found key barriers to uptake exist both at ecosystem and trade finance provision level, underscoring the importance of holistic interventions for meaningful impact. FSD Director for Credit Markets Jared Osoro, called for a comprehensive address...

The British Ambassador, Kate Foster, visited Hargeisa this week to reaffirm the strength of the UK’s partnership with Somaliland including in the trade and development sector. In her first visit to Somaliland since her appointment in February, Ms. Foster joined President Muse Bihi in launching the main construction phase of the 22.5 km Hargeisa bypass. The UK-supported bypass will reduce the time and cost of transporting goods between Berbera Port and landlocked Ethiopia by addressing a strategic chokepoint on the Berbera corridor. In the construction phase, particular attention will be paid to climate proofing, ensuring the road is built to last. Protection of local heritage is also a key consideration, recognising the road’s proximity to the iconic Nasa Hablood hills – the symbol of Hargeisa city. The corridor is already facilitating the delivery of much-needed humanitarian assistance to vulnerable communities in the wider region. The World Food Programme uses Berbera to bring 65% of its food aid into Ethiopia. With Ethiopia’s trade volumes projected to continue expanding, Berbera also represents an alternative for increasing trade and prosperity in the Horn of Africa. The continued development of the Berbera corridor will ensure that ordinary people from across Somaliland will benefit from inclusive economic development. Future UK support will focus on more efficient cross border trade between Somaliland and Ethiopia including through the use of one-stop border posts, cargo tracking systems and efficient regulation at the border. At the launch event, Somaliland President, Muse Bihi, said: “I would like to thank the UK and partners for their role in investing...

Nairobi hosts EU-Africa Green Talk dialogue on sustainable development impact of local projects Dialogue between European Investment Bank, Portuguese Embassy in Kenya, financial community and development stakeholders confirms importance of green investment. The Secretary General of East African Community today joined more than 150 African business leaders, financial experts and diplomats in the Nairobi EU-Africa Green Talk to share investment best practice and outline how to mobilise private sector support for sustainable development across Africa. “Recent innovative investment across East Africa has transformed access for millions of people to clean water, renewable energy and finance essential for a better and more sustainable future. Today’s Nairobi Green Talks allow innovative solutions and technical best-practice to be shared with the rest of Africa and the world. The East African Community commends the Portuguese Presidency of the European Union and the European Investment Bank for their engagement with East African partners to further strengthen sustainable investment in the years ahead.” said Dr Peter Mathuki, incoming Secretary General of the East African Community. Participants highlighted how recent and future private sector led clean energy, sustainable transport and business investment across East Africa can unlock economic opportunities, strengthen resilience to COVID-19, increase protection from a changing climate and ensure more sustainable use of resources in the future. “Partnership between Africa and Europe is key to increasing investment essential to combat climate change and create new opportunities. The Portuguese EU Presidency and European Investment Bank are pleased to join forces with East African business, political and...

A six-lane concrete link road that is expected to ease cargo movement from Mombasa port has been completed, Kenya Ports Authority (KPA) said recently. KPA General Manager for Infrastructure Development Vincent Sidai said the Sh2 billion road is co-financed by KPA and TradeMark Africa. The 1.2-kilometre road extends from Changamwe roundabout to KPA Gate 18 with additional 200 metres inside the port area. It will replace the old four-lane road. "The road will boost port capacity by improving traffic flow with other economic benefits including improved service delivery, reduced port congestion and delays with faster gate clearance," he said. The road will also accommodate a 40-metre railway bridge and a gate canopy for custom and security purposes. Mr Sidai said the road will improve port productivity and reduce the cost of doing business. "The construction of the new road was necessitated by cracks after it was noted that the ground had continued to be unstable and could not withstand the increased frequency of heavy commercial trucks plying the route due to the increased capacity at the port," he said. Initially, the existing four-lane dual carriageway was affected by traffic congestion from the Changamwe roundabout - disrupting the fluidity of cargo movement. For KPA, the completion of the road adds credibility to the management’s plan to increase efficiency through the Mombasa Port Development Programme (MPDP) initiative. Among the highlights of MPDP is the completion of the dockyard jetty at the port. Sidai said the new road will improve drainage, reduce vehicle...

The East African region is experiencing unprecedented obstacles to food trade, hurting livelihoods and derailing economic progress. Food insecurity, in its various forms, is one of the most significant challenges facing East African region and the wider Nile Basin member countries. About 140 million people in the basin (or 34 percent of the population of the basin states) are undernourished, with the level of severity varying from country to country, according to the ‘State of the Nile Basin’ report 2012. A rapidly growing population, coupled with increasing urbanisation and climate change, point to a worsening food security situation. Trade is usually one of the ways by which countries meet their food requirements, beyond what they can produce locally. The region possesses immense untapped potential not only to meet its own food needs but also to grow extra food to support other counties and use proceeds to improve the economies of the region. This potential to use food trade between member countries of the Nile Basin, however, faces numerous challenges. Several studies carried out on the subject of food security point to the low levels of production within member countries and generally much of Africa, as the most significant impediment to food trade. Too little is produced, leaving households with nothing left for sale. In Uganda, for example, one of the major food producers in the region, subsistence farming still accounts for more than 50 percent of the country’s farming households, according to the Uganda Census 2014. Lack of investments and...

There are 42 currencies in Africa which makes it difficult to easily transact between countries due to conversion needs which create a lot of inconveniences. This challenge may however be a thing of the past if plans to have a uniform payment and settlement platform sail through under the African Continental Free Trade Area (AfCFTA). The secretariat has announced seeking ways to ease the burden of doing business using 42 currencies on the continent which is a major boost to trade under the trade agreement. The AfCFTA secretariat is working with the African Export-Import Bank (Afreximbank) to develop a pan-African payment and settlement platform which will help overcome the challenge posed by the multiplicity of currencies on the continent. AfCFTA Secretary-General Wamkele Mene notes that a uniform payments platform will eliminate the costly process of converting currencies which contributes to the inefficient trade patterns on the continent. In addition to this good news, the Covid-19 pandemic was a silver lining for Africa’s integration since the continent has to create its own solutions to its problems. As such, Africa needs not only to harmonise its financial systems but also step up productive and infrastructural integration. The African Regional Integration Index (ARII) which provides up-to-date data on the status of regional integration in Africa and assesses the level of integration for every regional economic community and its member countries shows that Africa needs to do more to integrate its systems into the different sectors of the economy. ARII is a joint publication...

Trade has a critical role to play in rebuilding developing and least developed countries’ economies, alleviating rising poverty and creating a greener, more inclusive future for all. This was a unifying theme that ran through three days of panels discussions and debates at the Aid-for-Trade Stocktaking event the World Trade Organization (WTO) hosted online from March 23 to 25. Covid-19 has reversed 30 years of development gains, deepening inequalities from the household to country level and threatening to push 150 million into extreme poverty, WTO Director-General Ngozi Okonjo-Iweala noted in an opening plenary session that also brought together leaders from the International Monetary Fund (IMF), Organization of Economic Cooperation and Development (OECD), UNCTAD, World Bank and World Health Organization (WHO). The opportunity to take stock of Aid for Trade’s progress so far and steer its future direction comes at a critical juncture, especially for those least developed countries (LDCs) that were hit hardest by the steepest fall in global trade on record and have benefited least from its rebound. “The post-Covid recovery must not leave anyone or any country behind,” she stressed. Here are 6 takeaways from the event: Invest in pharmaceutical supply chains and ensure equitable access to vaccines With just 10 countries receiving 76% of the Covid-19 vaccines administered globally by the time of the event, ensuring more equitable access is critical. Ramping up vaccine production by investing more in LDCs’ and developing countries’ manufacturing capacity would help, as would boosting trade cooperation to address supply bottlenecks and...

The African Union unveiled the Animal Health Strategy for Africa (AHSA) 2018-2035 to strengthen animal health, animal production, productivity, animal safety, public health and a continent for a healthy environment. AHSA 2018-2035 is “a continental framework for delivering a sustainable animal health system that meets global standards. Healthy animals for more livelihood, a safe trading community and environmental health ”. The strategy, validated in Kigali, Rwanda, in November 201 8, was endorsed by the African Union Technical Committee, which included ministers responsible for animal resources, water, agriculture and the environment. The strategy was endorsed at the Summit of Heads of State and Government in Addis Ababa, Ethiopia, in February 2020. The Animal Health Strategy for Africa (AHSA) 2018-2035 is “a continental framework for delivering a sustainable animal health system that meets global standards. Healthy animals for more livelihood, safe public and environmental health ”. The aim is to address the challenges faced in the provision of animal health services on the African continent. It is aligned with the Animal Development Strategy for Africa (LiDeSA). In addition, it offers more targeted strategic interventions and approaches to holistically address the health of bees and water bodies as part of the One Health (OH) approach. The aim is also to align animal health services on the continent with the relevant global, continental and regional strategies and frameworks. Therefore, it serves as an overarching strategy to improve the efficiency and effectiveness of animal health measures on the continent. “The strategy builds on the achievements...

A decent job is an essential marker of a young person’s success. It provides financial security for his or her future family and contributes to the economic growth of their country. With more than half of Africa’s population under the age of 25, the need for decent jobs is enormous. “In Africa, youth make up 37% of the working-age population, but 60% of that number is unemployed. The youth demographic is very large compared to the available opportunities in the market,” writes Obiageli Ezekwesili, former World Bank Vice President of the Africa division, in her article Youth unemployment: Challenges & Opportunities in Economic Development. In Kenya for example, a recent study by the UN Development Programme put the country’s unemployment rate at a staggering 39%, the highest in the region, compared to 24% in Tanzania and 18% in Uganda. The demand for decent jobs is only expected to grow as the Africa Institute for Development Policy estimates that the continent will account for 29% of all people aged 15 to 24 by 2050. Some organizations have taken on the youth employment challenge through innovative and broad-based public, private and civil society partnerships that have the potential to be more impactful than they could have aspired to working alone. One example is the Young African Leaders Initiative (YALI), a partnership between the U.S. Agency for International Development (USAID) and private sector representatives. Together they create opportunities for African youth by enhancing leadership skills, bolstering entrepreneurship, and connecting young African leaders with one...

One of the key strategies to revamp Zimbabwe’s economy is to ensure adequate value-added export earnings so as to boost foreign currency generation and retain high-value jobs. The weakening of domestic production in the past years and subsequent drop in exports have undoubtedly affected other sectors of the economy in general, along with the unavailability of locally-produced essential commodities and services, which have stoked persistent trade deficits. There is a need to urgently synergise public and private sector efforts in coming up with appropriate steps towards improving the country’s exports as a sustainable path to attaining real economic stability and growing the economy towards the envisaged upper middle-income status by 2030. While the National Development Strategy (NDS1:2021-2025) sets the tone for jump-starting productive capacity in key sectors such as agriculture, mining and manufacturing, economic experts have called for speedy diversification to the exportation of value-added goods and services as opposed to reliance on exportation of primary commodities. Higher value addition and import substitution are at the heart of the NDS1 re-industrialisation focus. However, in a world that is undergoing a shift from typical industrial to information-based economies, developing robust export market intelligence has become a game changer. Big corporates and governments invest more in this thrust so as to attain reliable export data, which forms the bedrock of business management decisions. Competition in the export market is ruthless and Zimbabwe has to be aggressive in order to make it. Local producers, thus, need to be assisted to build adequate export...