Regional manufacturers are currently in Kigali to chart ways of revitalising the sector and help increase its contribution to growth and job-creation in particular. The manufacturers, who are attending the second EAC Manufacturing Business Summit, want East African Community governments to put in place sector-supportive policies to drive growth. The East African business community blames the minimal contribution of 10 per cent to the bloc’s GDP on the lack of supportive policies and deliberate reforms to spur the sector’s growth. Other challenges such as high power tariffs, poor roads and high cost of air transport also need to be addressed by EAC partner states for the bloc to register meaningful growth, create more jobs for the youth and reduce its dependence on imports that erode foreign exchange reserves. In addition, the call by the East African Business Council for the region to produce “what we consume and consume what we produce” is timely. This challenges member states to promote value-addition initiatives, particularly among SMEs, to deepen and broaden the industrial sector. It’s such efforts that would lay a firm foundation that would allow for improved performance of the manufacturing sector. However, regional governments must be ready to review laws that discourage trade and fair competition. The EAC Heads of Summit meeting held in Dar es Salaamm, Tanzania on Sunday  raised the issue of non-tariff barriers and the declining trade among member states. This calls for bureaucrats in the region to revise policies that affect manufacturing and trade within the bloc....

The discovery of oil, gas and mineral deposits in East Africa has paved the way for ambitious infrastructure projects that have attracted at least $3.4 billion from international lenders in the past year. The World Bank, the European Union and China are the region’s main infrastructure financiers. According to the Deloitte African Construction Trends Report 2016, Kenya had initiated the highest number of projects, 11, followed by Ethiopia and Uganda, with nine projects each, and Tanzania with eight. China and the EU have been the biggest financiers of Kenya’s infrastructure projects, with roads taking the biggest share of the funds. The EU, in partnership with other lenders — the German Development Bank (KfW), the European Investment Bank (EIB) and the African Development Bank — is funding key roads on the Northern Corridor, including the $151.7 million Mombasa-South Sudan link road and the $152.2 million Mombasa-Mariakani road. Walter Tretton, head of infrastructure in the EU delegation to Kenya, said the new link roads are a game-changer, in some places cutting the journey from days to hours. “The new roads will also help reduce congestion while improving the competitiveness of the port of Mombasa,” Mr Tretton said. Northern Corridor The EU, through the Africa Infrastructure Trust Fund (EU-ITF), has given $22 million to fund the Mombasa-Mariakani road while KfW and EIB have given $55.2 million each. Kenya is expected to inject $19.8 million. The proposed Kitale-Morpus road in western Kenya, which is expected to eventually link Tanzania and South Sudan through Kenya, will be...

What are the primary non-tariff barriers in Kenya? FRANK MATSAERT: The non-tariff barriers that affect Kenya the most are often imposed by Kenya itself. The first problem is weighbridges with the amount of delays, traffic congestion, overloading and transparency. The second problem is roadblocks, particularly on the trade corridor between Tanzania and Kenya. The third problem revolves around border institutions, particularly those with Tanzania and Uganda. Here, the border crossings open at varying times and when trucks arrive, they need to wait until the crossing opens. They also often still need to show physical rather than electronic documents, which hinders efficiency. Lastly, there’s also an issue with standards recognition between countries, and sometimes there are multiple institutions required to export and move goods around. This obviously creates quite a lot of complications for companies doing business on both sides of the border, and these all heavily affect the country’s neighbours. As far as remedies go, weighbridges can be replaced with modern weigh-in-motion bridges. Not only that, they can be linked across borders as well. To remedy the roadblock issue is a bit trickier, but it should definitely include more monitoring of roadblocks and making the private sector more aware of the cost that they incur for companies. For border institutions, revenue authorities should simply agree on a standard 24-hour opening for busy borders so traffic congestion can be avoided. Document processing should also be automated. For standards recognition, the main driver for efficiency will be harmonisation and mutual recognition. How...

For many years Rwandans have been dependent on second hand clothes imported from Europe and the United States. They are affordable and their high demand kept traders in business. However, the East African Community (EAC) partner states have agreed to systematically phaseout importation of second hand clothes in a way that will not hurt people dealing in them. In the Heads of State summit that was held in Dar Es Salaam, on May 20, partner states adopted a method to promote local apparel industries that will help meet local demand and indirectly discourage import of second hand clothes. “Partner states agreed that for now, the best approach to phaseout second hand clothes is by supporting local industries instead of banning importation of the clothes once and for all,” Francois Kanimba, Minister of Trade, Industry and East African Community Affairs today. In February 2016, five heads of state in the East African Community – Burundi, Kenya, Rwanda, Tanzania and Uganda – agreed to bring about a total ban on imports of secondhand clothes by 2019. While commenting on motives of the ban then, Rwandan Minister of Finance and Economic Planning Amb. Claver Gatete said that ending the trade was not just about industry, “it is just not acceptable according to our dignity.” “Every year, we spend over $15 million to import second hand clothes. Wearing such clothes is not worth our value,” said Claver Gatete, Rwanda’s Minister of Finance and Economic Planning. However, the EAC has since realised that the ban...

Dynamar B.V. of Alkmaar, The Netherlands, has recently issued another report in its Container Markets and Trades series: the fourth biennial edition of the “East & Southern Africa (worldwide) Container Trades”. Salient details and some of the interesting findings of the study are discussed in this review. West Africa West Africa is clearly moving into the direction of maturation. Compared to East Africa, the ships are bigger, there are more carriers and there is a substantial presence of international port operators. Currently, 112 box ships sail the core Asia-West Africa routes. Deployed by ten different carriers, their average capacity is 5,300 TEU, with the biggest ship measuring no less than 13,100 TEU. East Africa East Africa still has clearly some way to go compared to West Africa. With 2,900 TEU, the average of the 52 container vessels serving the area from Asia is little more than half the size of its West African sister. Including the largest 4,900 TEU unit, they are operated by nine different carriers. Hub and spoke is not practiced in East Africa. Hutchison Port Holdings (Dar es Salaam) was the single foreign terminal operator in the region until, recently, DP World started operating Berbera and sister company P&O Ports announced to develop Bosaso. Mombasa, the region’s largest outlet, is operated by its port authority. Defunct, but increasingly served Somalia may still be considered partly defunct, ever more containerships are coming to its ports. Eight different services are concerned, operated by six carriers: CMA CGM, Emirates Shipping,...

The European Union (EU) will continue to offer its assistance, to the best of its abilities, to the East African Community (EAC). The Head of the EU Delegation to Tanzania and the EAC, Amb Roeland Van de Geer, said that over the seven year period from 2014 to 2020, the EU and the EAC were addressing key challenges in East Africa by jointly implementing an ambitious development programme through the 85 million Euro 11th European Development Fund. Amb. Van de Geer further said that, in addition, EU Member states were also making available considerable amounts in development support to the EAC. “However important aid may be, trade and investment are crucial for a better future for all East Africans,” said the envoy. Amb. Van de Geer said the EU would continue to partner with the EAC in development cooperation and the promotion of peace, security and democracy in the East African region. He noted that the two blocs had witnessed increased cooperation over the past two decades, adding that the wide ranging cooperation would continue in the political, economic and developmental fields. Amb. Van de Geer was addressing guests during a cocktail event to mark the Europe Day 2017 at the EAC Headquarters in Arusha, Tanzania. He acknowledged that despite many years of unprecedented economic growth, Europe today suffers from serious economic difficulties. “Difficult as the times may be, our Union, built on solidarity and on the strong commitment to peace and development, see these tough times as an opportunity...

Speaking at the 18th Ordinary Summit of the of the Heads of State at Dar es Salaam State House minutes after assuming the EAC chairperson seat from Tanzania’s John Pombe Magufuli, President Museveni explained the three pillars for integration. “Integration is about three issues; prosperity, security and ‘ubuntu’ (brotherhood)”, the President said. Giving a synopsis of the origins of the East African Community, President Museveni praised Mwalimu Julius Nyerere for being steadfast in the push for regional unity even when his immediate post-colonial peers developed cold feet. “In 1963, Kenyatta (Jomo), Nyerere and Obote (Milton) met in Mbale, Uganda and declared there would be a political federation before the end of that year,” said President Museveni. “Obote and Kenyatta developed cold feet by the end of 1963 but Nyerere insisted on working for the EAC. It is how I became a Nyerere supporter.” He cited Mwalimu Nyerere’s decision to unite Tanganyika and Zanzibar in 1964 as evidence of commitment to unity and ultimately the region’s prosperity. “There was a revolution in Zanzibar and an opportunity offered itself. Nyerere and Karume formed Tanzania. It has survived all this time. Unity of Tanganyika and Zanzibar has given more opportunity of people the island to come to the mainland and vice versa,” he said. Integration for prosperity “Integration is important for prosperity. It is not a luxury. It is not whether I like you or not,” President Museveni said before illustrating his argument using the relationship between Kenya and Uganda when the latter’s...

East African Community (EAC) partner states that are yet to sign the EU-EAC economic partnership agreement (EPA) are not in position to do so pending clarification of issues they have identified in the draft agreement, the regional bloc has said. This was noted in a statement issued after yesterday’s 18th ordinary summit of the EAC Heads of State, held under the theme: “Towards sustainable growth and development of the Community” in Dar es Salaam, Tanzania. “It was however agreed that due to this action Kenya should not be disadvantaged since she has already signed the agreement,” the communiqué reads in part. In September last year, trade ministers of Rwanda and Kenya signed the deal at the EU headquarters in Brussels, Belgium. Last year, the East African Business Council (EABC) advised the partner states to sign the deal quickly since failure to meet the EU deadline for ratification (which has since passed) could see EAC exports to EU attract import duty, especially for Kenya, the region’s largest economy. Whereas Burundi, Rwanda, Uganda and Tanzania have an option to rely on the Everything But Arms (EBA) trade arrangement under which they can still enjoy duty-free market access to the EU, Kenya does not have the same privilege as its economy is considered to be more advanced than the others. Kenya sells some 30 per cent of its exports to the EU. At the summit, President Yoweri Museveni of Uganda assumed the bloc’s leadership that’s held on rotational basis and was mandated to...

The East African Community (EAC) leaders have directed partner states’ ministers in charge of EAC affairs to resolve long-standing unresolved non-tariff barriers (NTBs) and report to the next summit. The directive was made at the EAC Heads of State Summit on Saturday in Dar-es-Salaam, Tanzania. It comes after the Council of Ministers had also called for an end to a host of long-standing unresolved NTBs hindering trade in the region. “The heads of state noted with concern the declining intra-EAC trade and directed the Council to resolve the long-outstanding non-tariff barriers and report to the 19th summit,” reads part of a joint communique issued after the summit. Meeting before the summit, the central decision-making and governing organ of the regional bloc raised concerns that at least 19 non-tariff barriers remain unresolved as reported by a monitoring tool that was put in place. The ministers specifically raised concern over four longstanding NTBs whose solution, they said, requires policy guidance. They include the restriction by Uganda on beef and beef products from Kenya, since 1996. Others are requirement by Tanzania that cigarettes manufactured in Kenya and exported to Tanzania should have a 75 percent local content, and requirement by the Tanzania Foods and Drugs Authority (TFDA) that companies exporting to Tanzania should register, re-label and retest goods certified by other partner states. This trade barrier has existed since 2003. Raymond Murenzi, director-general of the Rwanda Standards Board (RSB), told The New Times that the issues concerning the TFDA are “very serious” as...

The country’s newly-elected representatives to the East African Legislative Assembly (EALA) have pledged to take the region’s integration agenda to the next level when they begin their duties next month. Rwanda’s new team of nine for the Fourth EALA was elected by both Chambers of Parliament yesterday and will be sworn in on June 5 together with their counterparts from Uganda, Kenya, Burundi, South Sudan and Tanzania. MP Odda Gasinzigwa, a former minister for gender and family promotion, said: “I will not let my country and the region down. I will work with my colleagues to heighten the integration agenda of the East African Community.” Gasinzigwa was first elected to the regional Assembly last October and yesterday won re-election for another five years. Among the new entrants at the regional Assembly is Fatuma Ndangiza. Despite being a first time legislator at EALA, she is no stranger to East African Community (EAC) affairs since she, among others, previously headed Rwanda’s team on an EAC experts verification committee set up to work on the introduction of South Sudan into the EAC. Ndagiza says she is happy to take on her new duties. “It is another responsibility I have been given and I wish to assure Rwandans that they will be well represented. It is clear that the Community has achieved a lot but wherever there are obstacles, we will work together to remove them. “Under the Common Market Protocol, for example, we will collaborate to ensure that agreements already signed are implemented...