The construction of Sh420 billion standard gauge railway will be completed before its scheduled completion date, President Uhuru Kenyatta was told during his inspection tour of the project on Saturday. The SGR project was set for completion in March 2018, but contractors say with more than 75 per cent of the work on the 235km track on the first phase between Voi and Sultan Hamud complete, they are ahead of schedule. The President visited section seven 7 of the project at Sultan Hamud, where he was told more than three-quarters of the civil works has been done. Uhuru said the government is in talks with investors to put up industrial parks along the SGR line to create jobs. “We have discussed how to set up industrial parks at Dongo Kundu in Mombasa, Voi, Mtito Andei, Nairobi and Naivasha, which will create jobs for youth,” he said. “Financing has been identified and construction is expected to start in September.” The main SGR contractor, the China Road and Bridge Corporation, has set up small construction camps on the route to ensure smooth and efficient operations. Uhuru was told local suppliers pocketed Sh50 billion injected into the economy by the railway project by February. The President has directed 40 per cent of supplies of goods and services to the SGR project be outsourced locally. The project has employed more than 30,000 residents, fulfilling one of the major demands that jobs be handed to local communities during the construction of the biggest investment in...

The decision by Uganda and Rwanda to ditch Kenya’s proposed oil pipeline in favour of Tanzania’s should ring alarm bells in terms of what this means, not just for the economy but for the viability of the standard gauge railway that is being touted by the government as a game changer. It may soon dawn on us that not only was the SGR a very bad idea, but that it will put the country in such serious debt that Kenya could soon be rushing to the International Monetary Fund for a bailout loan. Already the IMF has warned Kenya that the country’s debt burden and the huge loans from China can bring the country’s debt to unsustainable levels. By arrogantly excluding Tanzania from discussions and assuming that it could play big brother to its neighbours, Kenya shot itself in the foot and lost the goodwill that it took for granted. Kampala and Kigali probably realised that Kenyans had been taken for a ride and, therefore, put their heads together and decided that rather than rely on Kenya for its transport needs, it should turn to Magufuli’s Tanzania. At least Tanzania does not have the perennial conflicts that Kenya seems to have every election cycle and with less corruption, Ugandan and Rwandan goods will probably be safer and cheaper to export and import from there. The question we must ask now is whether the Chinese hoodwinked us into undertaking the SGR project knowing full well that it was not viable. A...

ADDIS ABABA (Xinhua) -- A senior official of the African Union (AU) has underlined the need for AU member states to act quickly to move forward the agenda of realizing continental free trade (CFTA) in Africa. Fatima Haram Acyl, AU Commissioner for Trade and Industry, made the remark on Monday during the opening of the First Ministerial Meeting of the Specialized Technical Committee on Trade, Industry and Minerals at the headquarters of the pan-African bloc in Ethiopia’s capital Addis Ababa. The two-day meeting, which was preceded by session of experts, has been organized under the theme, “Promoting regional integration through trade and inclusive and sustainable industrial development in Africa.” Recalling that the AU summit in June 2015 launched the CFTA negotiations in commitment to the realization of CFTA by 2017, the AU Commissioner called for speedy action to ensure the ambitious agenda of the continent on CFTA. “We have an ambitious agenda before us. It is therefore incumbent on us to ensure the effective delivery of this target. We should therefore be prepared to provide the necessary guidance bearing in mind the overall goal of One Africa, One Market, in line with the aim and objectives of the Abuja Treaty,” she said. “As a result of the foregoing, we can agree that it’s time for us to act and act quickly. It’s time to move forward our Agenda,” she added. In his statement made through a representative, Abdalla Hamdok, Deputy Executive Secretary of the UN Economic Commission for Africa (ECA),...

Growth in contributions to Aid for Trade levelled off in 2014 from a year ago according to Frans Lammersen, of the Organisation for Economic Co-operation and Development (OECD).  Support for energy generation and productive capacity building in developing countries continue to attract increased levels of funding  but commitments for trade facilitation programmes and for least developed countries (LDCs) fell between 2013 and 2014, he said. “I think we can be relatively confident that overall Aid-for-Trade flows will remain relatively stable,” Mr Lammersen said, noting that the aggregate aid commitments decreased by only 2% to USD 55 billion in 2014 and may have even slightly increased in 2015. Actual disbursements of total aid commitments, meanwhile, have seen continued growth every year of 5-10%. Aid commitments for private sector development, in particular, rose in 2014 and this is likely to continue in light of the UN’s Sustainable Development Goals (SDGs) which encourage partnerships with the private sector, he added. “But there is a decline in aid for trade policy and regulations in the commitments and to a lesser extent in the disbursements,” he said, with commitments for trade facilitation support dropping from USD 613 million in 2013 to USD 362 million in 2014. “That is a drop of 41%.” Australia said this could be addressed by having aid recipients work with donors on identifying their Category C commitments under the Trade Facilitation Agreement — that is, the areas of trade facilitation where they will need capacity building and assistance. This way, donors...

Despite the untapped opportunities that exist on the continent, trade between various African countries is still largely restricted. Joining CNBC Africa to talk about the some of the critical barriers and possibly provide us with solutions to improve intra-Africa trade is Matthew Conroy, Trade Manager of Maersk Line South Africa. Source: CNBC Africa

Green industrialisation is the direction Africa should be following right now, a green economy approach to economic transformation as the continent catches up to the rest of the world industrially, the continent might as well implement the policies pre-emptively, is the crux of what Giovanie Biha, Deputy Secretary, Economic Commission for Africa explained to CNBC Africa. This comes after the Economic Comission for Africa launched a report yesterday on the green industry. "We believe there is not going to be a long and sustainable development unless Africa industrialises, we are one of the continents, if not the continent that is lagging behind in industrialisation. Green industrialisation is a timely subject Biha says because of the COP21 agreement, the sustainable development goals and the Addis Ababa consensus with the financing for development. It’s timely she says not only because of the agreements on climate but also a number of African countries are putting in place policy frameworks for industrialisation and trade. “Because we are late comers, we can start in the right way, we can start industrialisation based on resource efficiency, we are basically saying that we have seen in the last few years in many countries that economic growth was based on export of raw commodities and now with the falling prices a number of countries are really vulnerable, so we are basically saying if we are starting to industrialise, let’s start in the right way.” Biha says if we do not do it now, a few years from now...

The East Africa Community registered six private equity deals in March, signalling a rising popularity with investors. The bloc said the private equity deals were mainly in infrastructure, manufacturing and real estate. Also witnessed was a diminishing interest in banks as sources of credit, as the rates charged had turned out to be expensive at above 18 per cent, compared with private equity deals which usually attract seven to eight per cent interest rate per year. Another strong point is the repayment period, which can be negotiated in case of a slowdown in business. Investors and multinational executives attending this year’s East Africa Trade and Commodity Finance Conference convened by the Global Trade Review in Nairobi said banks should rethink their traditional loan offerings to remain relevant. The forum heard that the current lending practices do not support growth but hinders uptake, forcing many businesses to rely on cheap funds from pension schemes, private equity and foreign investors. The panellists included Nakumatt Holdings financial controller Vijay Kumar, R.H Devani’s business development general manager Geoffrey Okora and UK Association of Corporate Treasurers development director James Lockyer. They warned that while traders continued to patronise local banks, the future portends a change of offering where banks have to come up with products that address direct business challenges or risk losing their core segment to incoming venture capitalists and private equity firms. Mr Okora said the prohibitive interest rates charged by local banks were fuelled by increased government borrowing which saw many banks buy...

As traders rue missed opportunities relating to Uganda choosing Tanzania over Kenya on the pipeline route, other initiatives are going on to spur intra-trade in East African. Hopefully, the recent initiative by Kenya and Uganda supported by a number of global and regional bodies to create a common platform for facilitating cross-border trade in fish and fishery products, using Busia Border point will succeed. Many times, the cumbersome and punitive inspection protocols for animal, human and plant products across the countries, which have different requirements and standards, has made it difficult for intra trade between the two countries. Uganda has a bigger supply for fish products, which on many occasions go to waste, while traders in Kenya face a huge domestic demand for fish products for local and export consumption cannot access because of stringent standards and different trade regimes within the two countries. To ease the cross border trade in fish and fish products, that will allow increased intra trade within the two countries, and by extension, export to other countries, a number of activities and facilities are to be established at the Busia border point that will provide quick inspection of human, animal and plant products health both at and behind borders. The pilot is among the several initiatives being implemented by partners in the business community as a way of increasing the level of intra trade volumes in Africa including: the EAC has developed the regional sanitary and phytosanitary standards, (SPS) the Inspectors’ guide; standard Operating Procedures;...

Africa’s agriculture sector is at an inflection point and could grow significantly in the coming years with the right investments and policy actions. This was the submission of business leaders, government officials and others who gathered for the 2016 Grow Africa Investment Forum in Kigali recently. The Grow Africa partnership reported that over $500 million in new private-sector investments were implemented in 2015, bringing the total to $2.3 billion implemented out of over $10 billion committed by more than 200 African and global companies. In the past year, these investments reached around 10 million smallholder farmers and created 30,000 jobs, bringing the total number of jobs created to 88,000 since 2012. In the first quarter of 2016, almost $500 million in additional investment commitments were made, suggesting that investor interest remained strong. However, investors have substantial concerns about the enabling environment for African agriculture, according to a survey conducted by Grow Africa. Business leaders believe that better access to finance and risk management tools, infrastructure, and policy and regulatory improvements are needed – but out of over 130 company responses, almost 70 per cent reported seeing no improvement on these fronts over the past year. “Agriculture is the sector that will transform Africa. Our industrialisation will be driven by value-added processing of our agriculture products. However we need to tackle key bottlenecks like infrastructure and farmers’ access to finance and markets,” President of Kenya, Uhuru Kenyatta said. Also, the Prime Minister of Ethiopia,Hailemariam Dessalegn outlined the significant progress to date...

Regional inflation rates could spike in the medium term following the sustained rebound of the price of crude oil in the international market, where it has risen from a low of $29 early this year to the current $47 per barrel. Rwanda recorded a rise in its April inflation rate to 4.6 per cent, up from 4.1 per cent a month earlier, which it blamed on rising energy and transport costs. Kenya, Tanzania and Uganda have also recorded an increase in fuel prices in the past month. The three countries saw their inflation drop in April, with Kenya’s year-on-year inflation dropping to 5.27 per cent in April, from 6.45 per cent a month earlier. Uganda’s inflation dropped to 5.1 per cent in April from 6.2 per cent in March, while Tanzania saw its April inflation decrease to 5.1 per cent from 5.4 per cent a month earlier. Rwanda’s central bank (BNR) said the country’s inflation levels experienced pressure as a result of increased transport prices after the recovery in global oil prices. Rwanda’s monthly inflation rate rose by 0.8 per cent in April, while its food prices rose by 5.6 per cent. The annual inflation rate for housing, water, electricity, gas and other fuels increased by 3.9 per cent while that for transport rose by 7.6 per cent. Last week, Rwanda’s Ministry of Trade and Industry announced an increase in the petrol pump price from Rwf826 ($1.05) to Rwf860 ($1.09) per litre, making it the highest in the region. “The...