The African Development Bank (AfDB) has signed an unfunded $250-million (Shs920bn) Risk Participation Agreement (RPA) facility with ABSA – a pan-Africa financial institution with a solid presence in 12 African countries. The 3-year RPA facility was signed November 12, on the sidelines of the Africa Investment Form through its trade finance operations. Under this 3-year RPA facility, the Bank and ABSA will share default risk on a portfolio of eligible trade transactions originated by African Issuing Banks (IBs) and confirmed by ABSA. Leveraging the Bank’s AAA rating, ABSA will underwrite trade transactions issued by African issuing banks across key sectors like agriculture, energy, and light-manufacturing with a special focus on Small and Medium Sized Enterprises (SME’s)  in fragile and low-income African countries. The Bank’s commitment under the RPA is to assume up to 50% (and 75% in special cases) of every underlying transaction issued by the IBs, while ABSA will confirm such a transaction and bear not less than 50% of its underlying risk. Working with strategic partners like ABSA, the Bank’s  trade finance operations aim to facilitate inter and intra Africa trade by reducing the trade financing gap on the continent. Since 2013, the Bank’s RPA program has supported over 16 issuing banks with about US$650 million  limits in Southern Africa alone, with special focus on SMEs and local corporates in manufacturing, agribusiness, import/export and energy sectors. In the same period, the program supported over $4billion in trade volumes across Africa, with $938 million of that being intra-Africa trade....

For the first time, Africans need visas to travel to less than half of other African countries, the report finds. A record 87% of African countries either improved or maintained their score, an increase of 9 points from 2018. The biggest improvements were made by Ethiopia, which moved up 32 places to join the top 20 in terms of openness, mirroring the country’s progress in the World Bank’s Ease of Doing Business Index. Senegal’s move to introduce visas on arrival for some African countries and removing visas required before travel pushed it up into the top 10. Yet the freedom of movement that will be needed to make the Africa Continental Free Trade Area (AfCFTA) a success remains a work in progress. Africa’s infrastructure deficit was a central theme at the AIF, which highlighted the need to attract investment into large-scale railway and road projects. Such projects will both require and further stimulate the free movement of people. Only two African countries, Seychelles and Benin, offer visa-free access to all Africans. Higher income African countries are among the laggards. Seven out of eight of Africa’s upper-middle income economies have low visa openness scores, the report finds. Egypt, Morocco, Algeria and Cameroon remain near the bottom of the table. Trust deficit The absence of the protocol for free movement of persons was a notable omission from the agenda at the African Union Summit in Niger in July, according to a paper by Mehari Taddele Maru of the Migration Policy Centre at the European University Institute in Florence. The AfCFTA was launched at...

First international digital road freight platform to be launched in the continent; Provides shippers and carriers a one-stop platform for road freight connections for domestic shipments within South Africa and international movements to several neighbouring countries; Further expansion to connect shippers and carriers within Sub-Saharan Africa (SSA) is planned for early 2020. Digital freight forwarder Saloodo! a subsidiary of DHL Global Forwarding, the leading international provider of air, sea and road freight services, today launched its digital logistics platform for shippers and transport providers in South Africa, bringing the first digital road freight solution to the region. An efficient road freight network is a key conduit of trade within a geographically wide-spread country such as South Africa but also with 16 landlocked countries within Sub-Saharan Africa (SSA). However, much of the region’s road freight operations remain fragmented and highly traditional, missing out on the visibility, efficiency and security that logistics technology offers. “Digital transformation is a top priority for the industry and given the demographics, we expect demand for digital transformation to be driven by emerging markets globally,” said Tobias Maier, CEO of Saloodo! Middle East and Africa. “Africa is the world’s youngest continent with 60% of the continent below 25. This is a dynamic generation of digitally-minded young adults, demanding smart, digital solutions both on the business and home front.” With South Africa as its launch pad into Sub-Saharan Africa, Saloodo! is the first digital logistics platform available in the region that offers a single, simple and reliable interface...

Growing momentum behind regional integration, economic reforms, technological advances and infrastructure development are among the key factors fuelling business growth in sub-Sahara Africa, said a new whitepaper released by Dubai Chamber of Commerce and Industry in cooperation with the Economist Intelligence Unit (EIU). The report, entitled “Promise and Perils: Scaling up businesses in sub-Sahara Africa”, was issued ahead of GBF Africa 2019 in Dubai. The findings shed light on the current business climate in sub-Sahara Africa and examined attractive business prospects offering the most potential for investors in the UAE and wider GCC region. Key growth drivers The report highlighted the importance of regional integration initiatives such as the East Africa Economic Community, Single African Air Transport Market and African Continental Free Trade Area (AfCFTA) in removing trade barriers and driving business exchange. The AfCFTA is expected to liberalising trade and investment policies and ease easing operational challenges related to international money transfers and payments. Combined, these allow African SMEs to expand operations across markets, creating attractive opportunities for investors too. Expanding telecommunications networks are facilitating the growth of internet connectivity, mobile money and new digital services that build on it. Mobile money, which facilitates money transfers and payments, is also a growth enabler as it moves into business lending. Improved internet connectivity is expected to drive the next wave of technological innovation, enabling companies to develop new, digital services for consumers on the continent. By 2025, 3G mobile network coverage is expected to account for 60% of the mobile...

The value of intra-trade among East African Community partner states increased to $5.98 billion in 2018 from $5.46 billion in 2017, accounting for a 9.4 per cent growth. This comes as member countries opted to trade with each other in the wake of falling demand for the region’s agricultural products in the US and the rest of the world. The East African Community Trade and Investment Report (2018) shows that all EAC member states save for Burundi recorded growth in trade with their regional counterparts. The report prepared by the EAC Secretariat shows that Uganda, Tanzania, Rwanda, South Sudan and Kenya’s combined exports to the EAC and Southern African Development Community regions amounted to $3.1 billion and $1.9 billion in 2018 respectively. This shows, however, the growth in intra-EAC trade slowed down to 9.4 per cent last year compared with 24.8 per cent in 2017. The positive trend signals the importance of intra-EAC trade that has been 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. In 2015 and 2016, intra-EAC trade was in the negative territory. Burundi’s total trade with other EAC partner states fell by 11 per cent to $150.9 million in 2018, from $162.6 million in 2017. Kenya’s total trade with EAC partner states increased by 4.7 per cent to $1.95 billion in 2018 from $1.86 billion in 2017, mainly on account of increased total trade...

President Yoweri Museveni on Friday held a meeting with the European Union delegation in Uganda led by the European Union (EU) Ambassador to Uganda, Attilio Pacifici. The European envoys that included the heads of missions of Belgium, France, Germany, Denmark, Spain, Ireland, Italy, Hungary, Iceland, Netherland, Poland, Austria and Sweden met the President at State House, Entebbe. Museveni was meeting the envoys as part of the biannual Article 8 Political Dialogue with the EU in accordance with Article 8 of the Cotonou Partnership Agreement. During the meeting, Museveni thanked the European Union countries for emphasising trade other than aid when dealing with Uganda that has seen Uganda’s earnings from trade with EU triple the aid to Uganda in the past few years. The President described the trade between the EU and Uganda and the African continent as a whole as complementary as the two mutually benefit from such trade. He, however, appealed to the envoys to attract more European companies to invest in Uganda and take advantage of the ready market in Uganda and Africa as a whole as well as the open tax-free and quarter free market of the USA and Europe that was also negotiated. On the status of the large number of refugees hosted by Uganda, President Museveni told the European Union envoys that the Uganda government policy was to welcome and host people who are running away from trouble but noted that the country faces challenges of resources especially for food, shelter, education and health and...

Movement of goods and people, bilateral trade and investment are set to ease as Uganda and the Democratic Republic of Congo plan to jointly construct 1,200 kilometres of roads. The project includes 24 kilometres Bunagana-Goma road up to Rutshuru in DR Congo; a 977 kilometres road from Mpondwe border post in western Uganda to Beni in DR Congo and a 180 kilometres road from Goli in northern Uganda to Beni. DR Congo President Felix Tshisekedi and Uganda President Yoweri Museveni signed the agreement at the first Joint Business Forum held at the Speke Resort Munyonyo in Kampala. The forum sought to promote bilateral trade, investment and connectivity between the two countries. While launching the forum, Uganda’s Foreign Affairs Minister Sam Kutesa cited official trade data which shows that DR Congo is one of the key export markets for Uganda. Total exports for Uganda to DR Congo in 2018 stood at $532 million of which informal trade exports were worth $312 million, while formal trade accounted for $221 million. President Tshisekedi has been to Uganda over five times since coming into office last year as he works to strengthen bilateral ties. DR Congo is seeking to join the East African Community, which will further open up the country to trade with member states. The need for better road infrastructure between the two countries came to light early this year when Rwanda closed its border with Uganda. This slowed movement of goods as hundreds of trucks bound for the eastern DR Congo...

African countries have been urged to carefully analyze global lessons and think beyond short-termism so as to effectively tap into the benefits offered by the African Continental Free Trade Area (AfCFTA) Agreement. The latest call was made by the Institute for Security Studies (ISS), an African non-profit organization, as it stressed that "global lessons show that for AfCFTA to work, the continent's leaders must think beyond short-term election cycles." The ISS, in its latest publication on Thursday entitled "Can African leaders put free trade above nationalism?" also noted that the signing of the continental free trade pact "couldn't have come at a better time for the continent," emphasizing some of the latest developments in the global trade relations. According to the institute, the collective effort required to get 54 of the 55 African Union (AU) member countries to sign the AfCFTA, "particularly on a continent divided by disparate political agendas, short-termism and sporadic diplomatic standoffs, shouldn't be underestimated." "While the agreement is lauded as an African solution to African problems, it is worth remembering the pitfalls of those who've traveled a similar journey to avoid the same mistakes. This is even more important as trade agreements worldwide show signs of unraveling," the ISS said. Noting that trade relations in Europe were forged over decades following World War II to counteract the factors that caused the war, and collaborate for sustained economic growth and prosperity. Reaching agreement was an arduous process, the ISS stressed that "Africa seeks the same outcome in...

Accelerating trade needs a vibrant logistics industry, according to Mr Meshack Alloys, a key player in the sector. Speaking during an event to announce the entry of Sendy in Uganda, Mr Meshack, the company’s chief executive officer and co-founder said: “We want to be part of the immense impact that the logistics industry will create in the economy as well as formalising the informalities in the logistics sector to spur trade.” A properly developed logistics sector, he said, will not only accelerate trade but also increase efficiencies while adding value across the economic value chain. Uganda being a land locked country, Mr Meshack said, needs an efficient logistics industry that is capable of becoming a key determinant in the overall performance of the economy. The logistics industry in Uganda continues to grow and it is considered as one of the backbones that can spur economic growth with properly planned investment. According to sector estimates, at least 200,000 people are currently engaged in the logistics industry, whose capacity if well harnessed, can take in as many more people as possible. According to policy experts, the success of logistics sector as whole is dependent on routinely attracting new and dynamic industry players. And for that, the entry of Sendy operations, a regional logistic platform, into the local market, should be greeted with applause, according to members of logistic fraternity, thanks to its modern approach to doing business. With the use of technology, the Sendy’s logistics platform with already hundreds of trucks in...

Uganda will begin refurbishing its century-old Meter gauge rail (MGR) network to boost bulk cargo transportation, after failing to secure US $2.2bn in Chinese funding for a new Standard gauge railway (SGR). Meter gauge railway (MGR) revamp The Managing Director of the state-run Uganda Railway Corporation (URC), Charles Kateeba said that the rehabilitation will be carried out in phases over several years and cost at least US$308 million. French firm Sogea-Satom will undertake the works, which include installing rocks ballast on sections, re-laying of tracks, flattening sections and repairing about 500 freight wagons. The European Union (EU) has given a grant of US $27.5m and the railway corporation is talking to international development lenders for the rest. Former colonial power Britain built the meter-gauge, 1,266km (790 mile) network a century ago, mainly to move copper and other commodities. But the network fell into disrepair during years of political upheaval and economic instability. “Due to lack of maintenance over the years, most of the network is now in disuse,” Kateeba said. “We shall replace some areas which have been either removed by vandals or are badly worn,” he added. Standard gauge railway (SGR) Majority of transporters, especially those dealing with bulk cargo, have been eager for cheaper transport and were disappointed when China did not offer funding for the Ugandan section of the Standard Gauge Railway (SGR) regional project. It was originally designed to connect Kenya’s Indian Ocean seaport of Mombasa to a vast hinterland including Uganda, South Sudan, Rwanda and Burundi. Kenya has developed a...