IN SUMMARY Officials have said they are ready to roll out their plan, which involves moving crude oil by trucks, train and pipeline, having tested it under every conceivable economic model. The Cabinet approved the early crude export plan last week, raising fresh queries over the commercial viability of setting up logistical assets worth over Sh200 billion before exploration firms discover new reserves. No investor has so far expressed interest in the pipeline venture publicly despite Kenya’s preference to have the infrastructure built through a public-private partnership. Under the export plan approved last week by the Cabinet, the government will initially move up to 4,000 barrels per day via trucks to Eldoret and by train to Mombasa port. The Energy ministry has brushed off doubts over its early crude oil export plan despite growing concern that the high cost of logistics involved could erase envisaged economic gains. Officials have said they are ready to roll out their plan, which involves moving crude oil by trucks, train and pipeline, having tested it under every conceivable economic model. “We are not trying anything new here but a model that has worked in other economies,” Petroleum PS Andrew Kamau told the Business Daily. The Cabinet approved the early crude export plan last week, raising fresh queries over the commercial viability of setting up logistical assets worth over Sh200 billion before exploration firms discover new reserves. Kenya has recently adjusted its officially confirmed crude oil reserve from 600 million to 750 million barrels. To...

“Brexit means Brexit”, according to Theresa May, the UK’s newly appointed prime minister. Though what this means for trade still remains speculative, experts watching the African oil and gas industry believe that Brexit will not significantly affect the sector. Yann Alix, a partner in leading global law firm Ashurst, who has a focus on deals and projects in the African oil, gas and mining sector, said that while currencies and stocks tumbled in a number of African jurisdictions immediately after the referendum result, “Brexit is unlikely to have a significant impact on the African oil and gas industry”. Stuart Carter, partner and head of oil and gas at European law firm Fieldfisher, agrees, but argues that in the longer term some effects may be felt. “The UK could be subject to some tariffs on oil and gas from the EU, so may be more likely to import petroleum from Africa”. However, Carter stresses that this is still highly unlikely. Speculation over the prospect of a second Scottish independence referendum brought about by the Brexit result might also prove to have an effect on the African oil and gas industry. Carter believes that projects could be delayed in the Scottish area of UKCS (United Kingdom Continental Shelf) and Africa could “potentially be one beneficiary” from a slowdown in the UKCS as teams become available for other projects”. Leaving the European Union has implications of fewer trade restrictions for UK business from the EU, and this could make working with African trading...

East African Community states need to develop rural infrastructure (especially electricity and ICT) to enhance mobile phone penetration and facilitate its use. The call was made by experts in reaction to the 2016 Brookings Financial and Digital Inclusion Project Report, which, despite showing substantial progress toward advancing financial inclusion in regional countries, indicates there is room for improvement. The report, released last week, evaluates commitment to and progress toward financial inclusion across 26 countries. It says Kenya retained its position as the highest-ranked country in the study by a five percentage point margin. Of four East African Community (EAC) countries in the study, Kenya scored an overall 84 per cent followed by Uganda and Rwanda at 78 per cent and 76 per cent, respectively, with Tanzania trailing at 68 per cent. Kenya, South Africa, Brazil, and Uganda held their places in the top five-ranked countries between 2015 and 2016. Country scores are hinged on four dimensions: country commitment, mobile capacity, regulatory environment, and adoption. The lowest income economy among the countries ranked at the top of the FDIP scorecard was Uganda driven in part by its strong levels of mobile money adoption. Rwanda, which ranked among the top 10 countries overall, is the other low-income country that demonstrated “a particularly strong performance” on the FDIP scorecard “Rwanda provides an effective example of how country commitment to advancing financial inclusion and the promotion of digital financial services can lead to a more inclusive financial ecosystem,” the report says. Rwanda jointly topped...

Regional trade ministers and Government officials are set to meet in Dar es Salaam Tanzania this week in a last ditch effort to sign a joint trade deal with the European Union(EU). The Ministerial meeting is expected to speed up negations on a regional trade deal that has stalled over the last four years. With an October deadline looming to ratify the economic partnership agreement (EPA) for having a unified trade agreement with the E.U, the Kenyan government is making a last minute appeal to its East African community counterparts to commit to a joint deal. “The EAC has now convened a ministerial meeting in Dar es Salaam this month, and it will be followed by a summit of Heads of State. The matter will be taken forward in that way,” Statehouse Spokesman Manoah Esipisu said during media briefing on Sunday. If the five member states of the Eat African Community (EAC) fail to agree on a joint trade deal, exports to the E.U will be subjected to high duty rates. Tanzania and Uganda are the two countries that have raised issue with the deal calling for further talks on what the full implications of the deal are before signing. Of concern to the two countries is the intended benefit of the trade deal to the EAC. Kenya however stands as the biggest loser if a consensus is not reached given the fact that E.U rules classify the country as a middle income. As such the country is not seen...

NAKURU, KENYA: The East African Grain Council (EAGC) has asked leaders in East African Community to incorporate private sector in promoting inter-regional trade. sector in EAC integration By Mercy Kahenda Updated Mon, August 15th 2016 at 12:13 GMT +3 SHARE THIS ARTICLE NAKURU, KENYA: The East African Grain Council (EAGC) has asked leaders in East African Community to incorporate private sector in promoting inter-regional trade. EAGC executive director Gerald Masila said policy to include private sector should be in line with EAC integration policy. Masila said there is huge investment gap in EAC member countries that should support cereal and grain value chain addition to boost food security and economy of farmers. "EAGC is working close with governments to ensure there are more private sectors investing in farming to boost production and inter-regional trade," said Masila. Masila said EAGC is engaging the EAC governments not to put barriers to regional trade for instance restriction of trading licenses to farmers that lock potentials. He said limiting trade barriers will see farmers sell their produce freely in EAC a move that will boost food security and economy among the states. Source: Standard Media

The East African Community regional integration process has seen the region register improvement in logistics performance which had stagnated in previous years, a World Bank report has said. The bi-annual report, ‘Connecting to Compete 2016: Trade Logistics in the Global Economy’, ranked 160 countries on their trade logistics performance as well as the region, identifying the challenges and opportunities. The report noted that the move by the East African Community nations to integrate into one bloc had elevated the region’s logistics performance, consequently making it more attractive for investments and reducing the cost of doing business. Among the most notable changes observed by the survey was the elimination of multiple barriers to trade and transport, such as cumbersome procedures. “The Northern Corridor was once known for multiple barriers to trade and transport, including lengthy dwell times at Mombasa port and cumbersome clearance procedures along the corridor. In 2012–13, the corridor countries started a series of reforms that significantly improved the logistics environment and drove down logistics costs,” the report’s authors observed. Integration, the report says, saw the establishment of a single customs territory, thereby tackling unbearable clearance procedures. “One of the reforms was to introduce Single Customs Territory clearance procedures within the East African Community, including Burundi and Tanzania. This means final customs clearances for free circulation can be made already at the port of entry in Mombasa. The system has significantly reduced administrative burden and shortened the time required for customs formalities,” the authors said. With the single customs...

The Kenya Revenue Authority targets to clear at least 70 per cent of imports under the Pre-Export Verification of Conformity cargo clearing system effected in January. “Compliant clients will have their cargo from the ship, to the track, to their destination. The process will be non-discriminating. It will depend on your record,” commissioner for customs Julius Musyoki told port stakeholders at a meeting in Mombasa on Friday. The system, spearheaded by the Kenya Bureau of Standards, enables the customs department to conduct pre-arrival clearance at the ports of export. The pre-arrival system requires traders abroad to present all cargo destined for export to inspection companies. The exporters is also required to avail the invoice for the cargo to the appointed inspection firm to confirm the value. The pre-arrival system requires traders abroad to present all cargo destined for export to inspection companies. The exporters is also required to avail the invoice for the cargo to the appointed inspection firm to confirm the value. Carriers must also ensure a Certificate of Conformity issued by Kebs appointed inspection agents is produced, prior to loading, as evidence of quality inspection. The new measure is part of the governments efforts to curb sub-standard goods and tax leakages. Kebs has contracted four inspection companies- Messrs Bureau Veritas, China Certification and Inspection Group, Intertek International, and Société Générale de Surveillance, to undertake PVoC activities. Kebs managing director Charles Ongwae said the law on conformity safeguards Kenyans from sub-standard goods. Pre-arrival clearance will also help cut costs...

IN SUMMARY The Burundian Coalition for the International Criminal Court, a lobby of 11 civil society organisations, is calling for an independent secretariat for the Benjamin Mkapa-led mediation team, saying East African Community Secretary General Liberat Mfumukeko is not neutral in the Burundian dialogue talks. “We have written to the EAC Heads of State Summit and to Mr Mkapa himself. Mr Mfumukeko is just following the agenda of the Burundian government; this is not helping the process,” he said. The UN Committee Against Torture in a recent meeting in Switzerland, voiced concern about reported reprisals against Burundians and civil society leaders. The Burundian Coalition for the International Criminal Court, a lobby of 11 civil society organisations, is calling for an independent secretariat for the Benjamin Mkapa-led mediation team, saying East African Community Secretary General Liberat Mfumukeko is not neutral in the Burundian dialogue talks. They claim that Mr Mfumukeko has sidelined key stakeholders who Bujumbura is uncomfortable with. “Mr Mkapa should have his own secretariat in this mediation. Mr Mfumukeko is from Burundi and continues to sideline the parties at the centre of the conflict, while inviting others,” said Lambert Nigarura, the chairperson and legal representative of the lobby group. “We have written to the EAC Heads of State Summit and to Mr Mkapa himself. Mr Mfumukeko is just following the agenda of the Burundian government; this is not helping the process,” he said. The government of Burundi issued arrest warrants for some of the parties to the talks whom...

Construction of the Standard Gauge Railway to link Tanzania and locked East African countries of Uganda, Rwanda and Burundi and facilitate transport in the central corridor is expected to start in December. The Minister for Works, Transport and Communications, Professor Makame Mbarawa, said in Dar es Salaam during a press briefing that the exercise to seek a contractor who will carry out the project is in good progress. The entire project is estimated to cost about 16 trillion/- ($15 billion) in which the railway line is expected to connect the port of Dar es Salaam to Rwanda and Burundi, while two additional lines will connect Dar es Salaam to the coal, iron ore and soda ash mining areas in the south and northern parts of the country. The line to Kigali, Rwanda is to ultimately connect the Democratic Republic of Congo (DRC). The railway line will run from Dar es Salaam to Tabora-Isaka-Mwanza, Tabora-Mpanda-Kalemela, Tabora-Uvinza-Kigoma and Isaka-Keza-Musongati and Burundi. The railway lines connect landlocked East African countries of Uganda, Rwanda and Burundi. “The project, which will facilitate railway links between four countries (Rwanda, Burundi, DR Congo and Uganda) and the Dar es Salaam Port, will be implemented in four phases,” Prof Mbarawa said on the resolutions of the Seventh Interstate Council of Ministerial (ICM). He added that completion of the project is expected to take three years. The ICM, which is composed of ministers of transport from Burundi, Rwanda, DR Congo, Uganda and Tanzania, was preceded by a Central Corridor...

By CORRESPONDENT, MOMBASA, Kenya, Aug 13 – The Kenya Ports Authority is currently facing delays and congestion of cargo after stringent measures were introduced to curb corruption. Hundreds of long distance drivers remain stranded inside and outside the port waiting to load their cargo and are now protesting against the delays. The Kenya International Freight and Warehousing Association (KIFWA) said transit cargo for neighbouring countries Uganda and South Sudan is pilling at the port. The Kenya Revenue Authority has also suspended staff involved in a tax evasion scandal hence leading to more delays within the port. According to KIFWA, Kenya Revenue Authority hired staff not familiar with newly introduced clearing procedures aimed at reducing cases of graft at the port hence affecting smooth off take of cargo at the port. KRA Chief Manager Operation Joseph Kaguru confirmed that they are facing challenges but the matter is being addressed. “We cannot continue working with the same staff accused of colluding with cartels to sneak out containers, they were suspended and the investigations are still going on,” said Kaguru. Kaguru said the new measures are meant to mitigate the risks. KIFWA secretary Bernard Simiyu said many of the transporters have lost millions of shillings due to delays. Recently KRA said they were investigating how 104 containers worth Sh100 million were removed from the port between June and July 2016 without payment of tax. At least 10 KRA and KPA employees have been charged with conspiracy to evade payment of Sh20 million in...