n an interview with Weekend Business, EU Head of delegation to Kenya Ambassador Stefano Dejak said Kenya’s manufacturing and agricultural sectors have huge potential yet to be realised. He said since over 26 per cent of Kenya’s export go to EU markets, there is need for more support to more diverse sectors and not only horticulture. “Most of the [Kenyan] exports are unprocessed. We want to assist Kenya to increase the share of processed agricultural products. At the moment, the value chains in agriculture and commercialisation are not yet at desirable levels,” said Dejak. He said small-scale farmers must be assisted since they carry huge export potential. Currently, EU is funding Kenya Rural Development Project to a tune of Sh9.9 billion (86.4 million euros) to boost agriculture. Having successfully hosted the 10th World Trade Organisation Ministerial Conference (MC10), Dejak added that Kenya scored incredible success especially in areas of agricultural subsidies and removal of taxes on Information Technology-related goods. On manufacturing, he appealed to the Kenya Association of Manufacturers to take advantage of the regional integration and specialise in areas that can win them comparative advantage. “Manufacturing sector is usually critical for economic take-off of any country. World Bank report shows this sector has stagnated yet it produces most jobs in any economy,” he said. For increased value chain in agriculture, Dejak observed that, a strong manufacturing sector that can significantly contribute to economic development is desirable. According to the latest Economic Survey 2016 by Kenya National Bureau of Statistics,...

Ugandan goods just got a whole new playground on the European market after the East African Community and the European Union ended negotiations on the Economic Partnership Agreement (EPA) after more than a decade of talks. Kristian Schmidt, the head of delegation of the Europe Union in Uganda, says EPA is about to enter into force and that, when it does, the conditions to trade and invest will be easier for the countries in the EAC region and those in the EU. “The trade negotiators have done their duty. The European markets are open to East Africa business community,” he said recently. “Exports originating from Uganda and the entire EAC will enter the market of all EU member states without paying customs duties and without limitation in quantities, for an indefinite time.” Schmidt was addressing a press conference organized by the European Business Forum (EBF), which was intended to announce the forthcoming European Business Expo and Food festival to be held in Kampala starting today, May 6. Schmidt added: “So, this leaves the door open for any company operating in Uganda to export freely; no customs duty to an integrated, single market of 28 European countries, with 508 million consumers with considerable purchasing power.” According to Schmidt, Uganda and EAC partner states have committed to partially and gradually reduce, and eliminate, customs duties on selected imports originating from the EU. “That means EAC operators can import from Europe more strategically. They will be allowed to buy duty-free, thereby at a...

The Kenya International Freight Forwarders Association (KIFWA) has called for the immediate withdrawal of the newly introduced tax and cargo clearing system where tax meant for the East African Community members is collected in Mombasa through the Single Customs Territory (SCT). Led by KIFWA Chairman William Ojonyo, the members lamented that in the last four weeks, they have incurred losses as they are unable to clear goods from the port after the government included vehicles and steel to be taxed and cleared using the Ugandan Asycuda system. Out of the 1,500 registered clearing agents in the country, only 139 were trained on the new system but only 5 per cent who are multinational companies, have access to the system password creating delays in clearing and congestion at the port. This follows the government’s decision to have vehicles and steel which form a bulk of the exports to Uganda, taxed and cleared using the new taxation system Asycuda a month ago, though the system was introduced late last year for bulk items like food stuff. Ojonyo has claimed that the Ugandan government through Uganda Revenue Authority (URA), is not interested in making business easy for the Kenyan businessmen as they are reluctant to train more agents yet if one makes a mistake with the system they are forced to pay a fine of 300 dollars or an estimated Ksh 30,000. They are now pleading with the government to halt the new system and revert all business to KRA’s Simba System until all agents...

Kampala — Tanzanian High Commissioner Ladislaus Komba has launched the registration of participants in the Afrika Mashariki Fest (AMF) half marathon, which will take place on May 29. The run will start and end at Kololo Independence Grounds. While addressing the press after the launch on Sunday at Nakumatt Acacia Mall in Kololo, Kampala, Dr Komba, who signed up for the 10km run, said the launch was meant to inaugurate the half marathon for the Afrika Masariki Fest initiated by the youth to promote the East African Community (EAC) integration. "The aim is to promote awareness, understanding and support our leaders in the integration process and to me, any process that is aimed towards the integration of our countries is welcome and I am proud to be part of it," he said. Dr Komba further said the Afrika Mashariki Fest (AMF) initiative is also intended to promote youth development and job opportunities and will also focus on protection and conservation of Lake Victoria, the region's largest water body. The AMF chief executive, Mr Kisembo Ronex Tendo, while addressing the press at the launch, said the event is a non-partisan voluntary youth platform that seeks to promote the regional integration of the six EAC member states. "We, therefore, seek to engage them across the region to embrace the EAC integration process through art, sports and civil society advocacy as our platforms," he said. Key athletes invited He said the run is expected to involve elite athletes with 10 from Addis Ababa,...

Arusha — East African Community (EAC) is facing a precarious financial situation and the new secretary general, Mr Liberat Mfumukeko, has put workers at the headquarters on notice, telling them to get ready for drastic changes. Speaking at a welcoming party organised at an Arusha hotel last week, Mr Mfumukeko said owing to the alarming financial state the regional body was going through, he was forced to take radical changes for the organ to survive. He made it clear that the EAC secretariat was operating on a shoestring budget because its donors, who accounted for about 70 per cent of its budget, had lagged behind in fulfilling their promises by at least 30 per cent. Though he is generally regarded as a less talkative person, the maiden speech the newly appointed East African Community (EAC) Secretary General gave painted him as a no nonsense person geared towards bringing much-needed changes on the way the EAC Secretariat and the community in general operates. Among major priorities, Mr Mfumukeko said he would concentrate on and push for full implementation of protocols and agreements signed or ratified by the EAC partner states, specifically the Customs Union, the Common Market and the East African Monetary Union protocols. He also made it clear that he favoured fast-tracking the integration of South Sudan, a new member of the bloc, into activities, programmes and projects of the EAC. At the same time, he said during his welcoming party by the staff of the community that he would...

The Kenya Ports Authority (KPA) management says signing of peace deal between  South Sudan’s President Salva Kiir  and opposition leader Riek Machar will boost trade between Kenya and the world’s newest nation. The management says the formation of Transitional Government of National Unity is major step in the return to peace and stability in South Sudan. KPA acting managing Director Catherine Mturi said they expect the volume of South Sudan’s cargo through the port of Mombasa to increase by over 10 percent. According to KPA records, South Sudan cargo through the Port of Mombasa dropped 7.7 per cent last year compared to 2014. KPA said a total of 702,531 tonnes passed through the port of Mombasa were destined for South Sudan . Mturi, however, said that Uganda remains the second biggest user of the port with an 11 per cent share, with its share in transit cargo 8.2 per cent year-on-year, rising to 5.9 million tonnes from 5.5 million tonnes in 2014. On the other hand, Mturi said that KPA management has embarked on a major campaign to fight corruption at the port adding those found engaging in corrupt deals will not be spared. She further said that KPA is already engaging cyber security experts to deal with the problem at the port of Mombasa. Last week, Machar was inaugurated as vice president by President Salva Kiir ahead of forming a unity government. “Our people are tired of war and they need peace, now,” Kiir said. “Together we can accomplish...

Tourism Cabinet Secretary Najjib Balala has said the government is set to construct a world class cruise ship terminal at the port of Mombasa at a cost of 200 million shillings. Addressing stakeholders and the Kenya Port Authority officials on Tuesday after he toured the site, Balala said the move will see tourists docking at the port of Mombasa being ushered to a place where they can rest. The CS said that the efforts will enable tourists both from abroad and in the country to be entertained and introduced to the local culture and cuisine before they continue with their journey to other parts of the country. “Kenya Ports Authority will contribute 100 million shillings while the Tourism Ministry will give out a similar amount so that the project can become a reality within the stipulated period of time,” said Balala. Balala said the tourists will also be registered using modern technology before they are guided to the destinations of their choice at the Coast and other parts of the country. On her part, acting Kenya Ports Authority Managing Director Catherine Wairi said the noble project will not only sell Kenya abroad as the main tourist destination in East and Central Africa, but will also increase the number of tourists in the country. She said the KPA management will support all efforts from the Tourism Ministry and the security departments to ensure the tourism sector gets back to its normal state. Source: Hivi Sasa

Trade issues took centre stage during the 103rd session of the Council of Ministers of the African, Caribbean and Pacific (ACP) Group of States, which was held on 25-29 April in Dakar, Senegal. Ministers discussed prospects regarding the Economic partnership agreements (EPAs) still under negotiation with the European Union, as well as issues related to trade in various commodities, such as fishing products and sugar, among others. Ministers also expressed their determination and enthusiasm in advance of the upcoming Summit of Heads of State and Government of ACP countries, which will take place in Papua New Guinea from May 10 to June 1. Hopes are high that the meeting will provide the needed political mandate to rejuvenate the organisation, as well as a foundation on which to build productive engagement regarding the future of the relations between the EU and the ACP Group. The meeting of ACP ministers was followed by a session of the ACP-EU Joint Council of Ministers, which gathered ministers from ACP countries and their counterparts from the European Union. A call for flexibility on the Economic partnerships agreements During the meeting of the council, ministers of the ACP Group agreed on a resolution regarding the Economic partnership agreements between the different ACP regions and the EU. The EPAs are reciprocal – although asymmetrical – trade agreements between the EU and seven ACP regions, namely Central Africa, Eastern and Southern Africa, the East African Community, the Southern African Development Community, West Africa, the Caribbean and the Pacific....

The new East African Community secretary general, Mr Liberat Mfumukeko, has assumed his duties with a promise to turn around the cash strapped regional body. It is not a secret that the new executive comes at a time when the EAC secretariat is operating with a shoestring budget, 70 per cent of which is donor funded. It means that, what the member countries raise a mere 30 per cent of a budget, and that isn't good enough to keep the integration dream alive. It therefore goes without saying that if EAC continues to operate this way, there is no way the six countries will attain the intended unity any time soon. Mr Mfumukeko, who had been an employee of the secretariat for before his elevation to the helm, has vowed he will work on this sorry state. We hope the EAC states will take this as a wake-up call and find ways of raising funds with which to benefit their people. The statement by the new boss in Arusha means EAC members should aim to make sure donor dependence in running their regional affairs is reduced to a minimum or scrapped altogether. We believe this is possible. If individual countries device and implement strategies to reduce with donor dependence, why shouldn't they do the same at the regional level? What is needed is for the partners to the community to support the new boss who has shown he is determined to make EAC independent. If we want to make the...

This really does have to be one of the sillier pieces of economic policy now being tried out. The East African Community has proposed banning the import of second hand clothes. In February, however, the East African Community (EAC), an intergovernmental organisation, proposed a ban on imported used clothes and shoes. The aim is to encourage local production and development within member countries: Burundi, Kenya, Rwanda, Tanzania and Uganda. The problem here is that people are not understanding the most basic point about trade, poverty and jobs. Imports are the purpose of trade, poverty is the inability to consume and jobs are a cost of doing something. Thus this is nonsense: Many orthodox economists disagree with banning imports because it goes against the principles of free trade. Rather than having the freedom to choose imported used clothing, east African consumers will have to buy higher priced local goods or new clothes imported from Asia. Increasing the cost of clothing will hit east Africa’s many low-income consumers, but the shock effect could be reduced if a ban was imposed gradually. If a tax on used clothing imports was introduced before an outright ban, this could subsidise local production and increase local manufacturing capacity. A revitalised local market would ultimately boost the EAC’s economy by providing more jobs than the second-hand sector while retaining money that currently goes to Europe and the US to pay for second-hand imports. It's not that economists oppose this in order to support free trade. It's that economists...