Kenya plans a new round of talks next month in a last-ditch attempt to convince the other members of East African Community (EAC) to sign an agreement for local goods to continue enjoying duty-free access to European market. Kenyan officials Tuesday downplayed fears that the EAC trade bloc will miss the October 1 deadline set by the European Union secretariat, in what would introduce duty and quotas on Kenyan exports to Europe, making them uncompetitive. This came after Tanzania recently said it would not sign the Economic Partnership Agreement (EPA) with the European Union that grants regional goods duty-free access to Europe, citing Britain’s exit from EU. Uganda has said it is still reviewing the terms. According to EPA terms, the EU can only strike a trade deal with a bloc comprising several nations, meaning a single country cannot go it all alone. This has limited Kenya and Rwanda that are willing to sign up. “We are optimistic that the talks planned for early August will be fruitful and beat the deadline,” Kenya’s Industrialisation and International Trade secretary Adan Mohamed said at a press briefing. The bloc had expected to strike a deal on July 18 in Nairobi but the plan failed. Failure to reach a deal spells doom to thousands of workers involved in cut flowers, fruits, fish, beans, coffee and tea which are mainly exported to the EU. The lapse of the existing interim preferential trade deal without another arrangement would mean imposition of import duties on Kenya’s fresh...

The ‘Africa High-Level Bonn Challenge Roundtable’ was convened by the Government of Rwanda, the East African Community (EAC) and the International Union for Conservation of Nature (IUCN) to build regional cooperation on the Bonn Challenge – a global effort to restore 150 million hectares of deforested and degraded lands by 2020 and 350 million hectares by 2030. The pledges comprise 2 million hectares from the Republic of Guinea, 3.5 million hectares from the Central African Republic, 5 million hectares from Côte d’Ivoire, and an additional 1 million hectares from Ghana (who had already committed 1 million hectares). The Republic of Congo also reaffirmed its commitment to restore 2 million hectares. These new pledges bring the total amount of land committed by countries, companies and organisations for restoration under the Bonn Challenge to over 107 million hectares. “We recognise the importance of the engagement of the international community for the implementation of the Bonn Challenge in our country,” says Christine Sagno, Minister of Environment, Water Resources and Forestry, Guinea. “Forest landscape restoration will help us achieve our international commitments, particularly to the UNFCCC, the UNCCD and the CBD.” Along with the Republic of Congo, other national governments in Africa had earlier pledged their support for the Bonn Challenge, totalling 55.3 million hectares for the region. This includes Burundi (2 million hectares), Democratic Republic of Congo (8 million hectares), Ethiopia (15 million hectares), Kenya (5.1 million hectares), Niger (3.2 million hectares), Rwanda (2 million hectares), Uganda (2.5 million hectares), Liberia (1 million...

East African Community (EAC) member countries are meeting in Kigali for a validation workshop on the study by the Regional Centre on Small Arms (RECSA) on the status of armed crimes in Burundi, Kenya, Rwanda, Tanzania and Uganda. The report dubbed 'Analysis of Armed Crime Rates' released yesterday, in Kigali was conducted between 2010 and March 2016 with the support of African Development Bank (AfDB). According to the report, Rwanda registered 421 cases related to armed crimes between 2010 and March 2016, the least in EAC compared to other four bloc member states mentioned in the study. Tanzania registered 9, 646 cases; Kenya 12.877 while Burundi and Uganda complete the list with 26, 041 and34, 512 cases respectively, the report further states. Inspector General of Police (IGP) Emmanuel K Gasana, while presiding over the event, highlighted measures put in place by Rwanda in prevention and control of the proliferation of small arms and light weapons, including laws and community awareness as well as arms' marking. "The electronic arms record keeping software has been instrumental in enhancing effective arms record keeping and accountability hence minimising possible misuse of arms and this has had a positive impact on reduction of armed crimes in our country," IGP Gasana said. Rwanda was among the first countries to enact and revise its regulations on small arms in line with international and regional obligation of legal harmonisation. "Rwanda National Police continues to make use of different strategies like training and development, crime awareness campaigns through community...

Plans for the Lamu - Garissa highway have kicked off as the transport corridor to connect Kenya to Ethiopia and South Sudan starts to take shape. The Kenya National Highways Authority (KeNHA) is seeking environmental approval for the project that will cost Sh38 billion, funded by the African Development Bank (AfDB). The 250 kilometre road is the second major component of the Lamu Port South Sudan Ethiopia (Lapsset) transport corridor after the ongoing construction of three berths at the port. “The project road, Lamu – Garissa road, forms the initial part of Lapsset corridor,” an audit submitted to the National Environment Management Authority (Nema) says. “The project road will be a gateway to the Lapsset corridor which will provide connectivity to other parts of Kenya through railway and highway.” The highway has a width of 100 metres, will have two lanes but could in future be expanded to four or six lanes. A lane width of 3.5 metres and the shoulder width of two metres are the proposals for its design. It is expected to pass near wildlife sanctuaries, so eight animal crossings will be built along the five major wildlife and forest corridors for safety of animals. “Safety fences have been proposed over certain lengths before and after the crossing points to prevent animals straying into the road. It is also recommended to provide safety fence at these five corridors all along the road length passing by the side of the sanctuary or forests areas with openings only at...

Delays in clearing goods, corruption and theft at the Port of Dar-es-Salaam in Tanzania, and high fees charged by some regulatory agencies continue to hurt trade along the Central Corridor, officials have said. Members of the East African Business Council (EABC) brought the matter up during a Public-Private Dialogue (PPD) in Dar-es-Salaam last week. Traders also complained about value added tax (VAT) charged on auxiliary services levied on goods on transit. Omar Kassim, chairperson of Uganda Clearing Industry and Forwarding Association (UCIFA), said the issues need to be addressed to ease doing business. Kassim, who is also EABC vice-chairperson for Uganda, said, for instance, clearing of goods in Tanzania takes 10 days on average, while in Rwanda the same task takes a maximum of three-days. “Long clearing time in Tanzania is attributed to complicated documentation and compliance activities as businesspersons require 10 documents to import or export to Tanzania,” Kassim said. Various documents, he argued, attract different costs estimated to be double the average costs incurred in other sub-Saharan countries. “As if that is not enough, delays and challenges linked to documentation and border compliance has bred corruption among trade facilitation agencies,” Kassim said. According to Tanzania’s VAT Act 2014, supply of international transport services is zero-rated regardless of who the supplier is. Eighteen per cent VAT is applicable to additional services such as cargo inspection, preparation of customs documentation, container handling and storage. Sources say for goods in transit to qualify for to zero-rate, the services must have a...

Intra-African trade has long been a weak point hit upon by leaders looking to strengthen sustainable growth on the continent. Within certain regions, such as the West African Economic and Monetary Union, WAEMU (or by its French acronym, UEMOA), the East African Community (EAC), Southern African Development Community (SADC) or the Common Market for Eastern and Southern Africa (COMESA), regional economic unions have flourished along trade needs and cultural links. The most recent African Economic Outlook (AEO) shows that despite varying degrees of economic growth and development, economic blocs have benefitted community members through not just increased trade, but income convergence, with UEMOA leading among them. Incomes have narrowed at an average rate of 19.6 per cent between WAEMU’s richest and poorest countries over 15 years, according to AEO. In almost all WAEMU countries, the per capita GDP has risen compared to Côte d’Ivoire, the region’s leading economy. Benin and Senegal have caught up with Côte d’Ivoire, while remaining members Niger, Benin, Mali, Guinea-Bissau and Burkina Faso are still behind. “This could mean that poorer countries grew faster than richer ones to narrow the gap. The convergence may also be explained by the slowdown of the Côte d’Ivoire economy during the country’s political crisis of the early 2000s,” the report stated. African trade with the rest of the world, especially the European Union, has remained consistently high throughout a decade of growth and the 2008 economic crisis. However the ‘Brexit’ shake-up, along with a general downturn in commodities prices, puts...

NAIROBI - The East African Community (EAC) governments have been urged to support grain trade, with the argument that such trade is the only sure way for the people to transact and exchange value and thereby raise the standards of living of the citizens. The directors of Eastern Africa Grain Council (EAGC) pointed out the challenges faced by their members in conducting cross-border trade, particularly within the region. It is understood some regional governments have been taking short-term measures to block trade and thereby undoing all the efforts made towards long-term solutions. The directors cited cases where export permits were cancelled without notice. "Some of the effects include trucks being impounded and stopped at the border points, resulting into very heavy financial losses in transport waiting charges, loss of time, inability to meet contractual obligations and high expenses," they said in a press statement. They acknowledged that each of the regional countries had different agro-ecological zones and that at any one time within the year, crops were being harvested in one country and when one country was harvesting, another was not. The EAGC directors said there is reason and basis for continuous trade in grains throughout the year. And their argument is that as a region, if free trade is facilitated by the various national governments, then the entire region will always have sufficient food to feed the East Africans. Regional governments were urged to refrain from any actions that would impede cross-border trade. The meeting, which took place in...

Businesses in Tanzania are accusing the government of being anti-business after its recent announcement that it will introduce value added tax on ancillary services. During an East Africa Business Council meeting this month, Gilead Teri, the director of policy at the Tanzania Private Sector Foundation, said the introduction of VAT on ancillary services provided for goods in transit had resulted in a drastic decrease in the amount of transit cargo shipped via the Dar es Salaam port; competing ports don’t charge VAT on ancillary services. “Introduction of 18 per cent VAT on tourism services such as game driving, water safaris, animal or bird watching, park fees and ground transport services will be unfavourable for business,” said Mr Teri. The measures to broaden the tax base have started to bite, with some hotels in Dare es Salaam turning their facilities into hostels. Kassim Omar, the chairman of the EABC Uganda Chapter and national chairman of the Uganda Clearing Industry and Forwarding Association, told the meeting that businesspeople require 10 documents to import or export to Tanzania, which attract costs estimated to be double the cost incurred in other sub-Saharan countries. “Having discriminatory taxes between domestic and imported products from EAC partner states is against Article 15 on National Treatment of EAC Customs Union Protocol, which prohibits EAC partner states from enacting legislation or applying administrative measures that directly or indirectly discriminate against the same or like products of other partner states,” Mr Omar said. He further claimed that unlike other EAC...

The political crisis in South Sudan is expected to impact on the East African economies as the crisis disrupts businesses and trade, undermining the region’s prospects for growth. The crisis is happening at a time when the region has yet to find a concrete solution to the Burundian political crisis, which not only raises the bloc’s risk profile but also dents investor confidence. While South Sudan’s admission into the EAC earlier this year raised optimism about the potential economic gains from its integration — expanding the EAC Common Market to 162 million people — the recent violence has analysts warning that it could wipe out recent economic gains. While definite figures are not readily available, Uganda and Kenya’s annual exports to South Sudan are valued at some $200 million and $180 million respectively. However, political instability and the adverse impact of external shocks over the past two and a half years are expected to have a significant impact on South Sudan’s economy and the region. Regional businesses, mainly from Kenya and Uganda, that have opened outlets in South Sudan are already feeling the pinch due to political instability, forcing them to rethink their business strategy. “Due to the recent disruptions in South Sudan, we scaled down our operations and we have been reviewing this stance as the situation improves,” said KCB Group chief operating officer Samuel Makome. KCB was among the first regional banks to enter the South Sudan market. “South Sudan is a key market for us and we...

The Dutch government and Trade Mark East Africa (TMA) have committed to improve the financial fortunes of women in East Africa’s cross-border trade. Through the ‘Women in Trade’ programme, the Netherlands authorities aim to reach 25,000 women in Kenya, Uganda, Rwanda, South Sudan, Tanzania and Burundi by the end of this year. Trade Mark has signed a $500,000 (Sh50 million) agreement with the International Trade Centre (under the programme to support 800 women-owned SMEs to access international markets. While addressing trade exhibitors at a Nairobi hotel, Dutch Minister for Foreign Trade and Development Cooperation Lilianne Ploumen said there is need to support the women businesses to complement statistics that show they own over 40 per cent of business in East Africa. “Research has shown that empowering women to trade is good for the economy, society and women themselves,” she said while touring a trade exhibition on the sidelines of the United Nations Conference on Trade and Development in Nairobi. TMA director general David Stanton said supporting women in trade is part of the organisation’s vision to foster inclusive and sustainable economic development. “The partners will work to improve export opportunities for women enterprises in East Africa, and strengthening the capacity of institutions and associations to effectively support women entrepreneurs,” he said. Stanton said TMA was committed to increasing its support to women, with a vision of reaching at least one million more women in the second phase of the programme. However, Ploumen regretted that, despite the prevalence of women-owned SMEs...