Across East Africa, something wonderful is happening. Technology is monetising people's lives especially in the rural areas, at a rate totally unheard of before the coming of the mobile phone. When someone uses their phone to either send or receive money, the networks are happy, the banks are happy and the customer is happy. More important financial inclusion is expanding which is always good for an economy, because it also encourages savings. Now cross-border mobile money services are helping to rapidly demystify the whole concept of regional trade. With greater financial inclusion comes more business and consequently general prosperity. The East African Community governments should also be commended for encouraging financial inclusion. According to the World Bank, an estimated two billion working-age adults - more than half of the world's total adult population - do not have an account at a formal financial institution. Financial inclusion efforts ensure that all households and businesses, regardless of income level, have access to and can effectively use the appropriate financial services they need to improve their lives. Currently, the world's poor live and work in what is known as the informal economy. Even though they have little money, they still save, borrow and manage day-to-day expenses. However, without access to a bank, savings account, debit card, insurance, or line of credit, for example, they must rely on informal means of managing money. This includes family and friends, cash-on-hand, pawn-brokers, moneylenders, or keeping it under the mattress. Sometimes these choices are insufficient, risky, expensive,...

What is the future of the WTO? Will the Doha Round survive? How can trade help develop the world’s poorest nations? Why does Africa import 83% of its food? These are some of the big issues to be explored at the Trade and Development Symposium (TDS) in Nairobi, Kenya, 14th to 17th December. TDS will run in parallel with the WTO’s 10th Ministerial Conference and offers a unique and vital platform for wider discussions that wouldn’t be possible in the confines of the WTO negotiations. TMA is a strategic partner for TDS and will host and lead in a number of discussions related to trade. With more than 1500 participants, TDS 2015 will be the biggest ever gathering of trade experts in the world. [caption id="attachment_10990" align="alignleft" width="600"] ICTSD fellow Amb. Darlington Mwape addresses the press in Nairobi. “There have been benefits for Africa and Least Developed Countries in the lifespan of WTO. For example the OSBP made possible by WTO.”[/caption] They will be joined by WTO trade ministers and their delegations, representatives from the private sector, NGOs, the United Nations, the World Economic Forum, the International Trade Centre, the World Bank, senior academics, think-tanks and thought leaders. In addition to TMA experts other, Notable names that will talk trade at TDS include: Akinwunmi Adesina, President of the African Development Bank Ambassador Amina Mohamed, Ministry of Foreign Affairs and International Trade, Kenya Roberto Azevêdo, Director General of the World Trade Organisation (WTO) Dr. Richard Sezibera, Secretary General of the East African...

Businesses in import and export are worried by new import rules which they say might increase the cost of some commodities and hurt those dealing in small quantities. In a notice published in local dailies yesterday, the Kenya Bureau of Standards (Kebs) and the Kenya Revenue Authority said all imports must be accompanied by a certificate of conformity starting December 1, 2015. Inspected goods The certificate is a document that an importer obtains after goods are inspected and certified to be of required standards, with Kebs relying on agents stationed at the source of the products to do the job. While some products have been exempted from the requirement in the past, all imports will now be required to be accompanied by the document. No cargo shall be allowed entry into Kenya without the fulfilment of conformity certificate. Presentation of the certificate shall be mandatory to facilitate clearance of imports by Kebs and the revenue authority the notice stated. “This requirement has been found necessary in order to protect the safety and health of Kenyans in addition to securing tax revenues (with) key concerns that have arisen in the past including cases of cargo misdeclaration and under-valuation.” The Shippers Council of Eastern Africa said the government has a good intention of protecting Kenyans against harmful products, but cautioned that the rule would not apply to some sectors of the economy. “We support Kebs in what it is doing and we believe that the move will address the issue of contraband...

China is being coy about the navy installation it is setting up in the East African country of Djibouti, referring to it simply as a resupplying position for its ships participating in United Nations anti-piracy missions. But whether it is to be called an outpost, a base or some other term, there is no escaping the symbolism and meaning. The historic role of the Chinese military has been to protect borders and territory, yet the Horn of Africa nation is more than 7,700km from Beijing. To rivals like the United States and Japan, such a facility could readily be viewed through the lens of hegemonic intentions. President Xi Jinping (習近平 ) has made no secret of his plans for the People’s Liberation Army. In a speech to senior military officers last week outlining a restructuring of operations, he said he wanted to “build a robust national defence and a strong military that corresponds to our country’s international stature and is adapted to our national security and developmental interests”. A white paper earlier this year outlined ambitions for China to become a global maritime power. Djibouti, adjacent to waters through which billions of dollars in Chinese trade and resources pass and on a continent where there is no greater trading partner and investor, is an ideal location to pioneer such aspirations. Djibouti, a poor country of 900,000, gets a sizeable income from renting military bases. The country’s strategic location, near sea lanes between Asia and the Middle East and Europe, and...

Kigali — Citizens of the region will benefit a great deal from the facilities offered by the One Stop Border Posts (OSBPs) system in the East African Community Partner States, but there are still technicalties holding back full implementation. According a report by a committee set up by the East African Legislative Assembly (EALA), where the facilities are already running, there is free movement of persons and a faster flow of trade between the respective states. The report was adopted by the House during their sitting in Kigali last week. The regional legislators are now calling for the fast-tracking of all remaining works of the OSBPs to allow its implementation for further integration. During debate, at one stage Shyrose Bhanji said she was concerned with the slow implementation of the decisions of the House and these were being overlooked. "I had hoped to hear there is 100% implementation of the OSBPs. The reasons given for the delay are not good. Where is the problem Honourable Speaker? The process of getting the Bill has been costly. It is important that it is effected," she said. It was agreed that it is key for the assent of the OSBP Bill, 2013, in the Partner States to be finalized to give it legal effect in the entire region. According to release fromthe Secretariat, members were informed that Partner States are implementing the OSBP Initiatives bilaterally as they await for completion of the Assent process. At the moment, the Bill which was introduced by...

The three facilitators appointed by Director-General Roberto Azevêdo to support members to develop a Ministerial Declaration for the WTO’s 10th Ministerial Conference presented their draft Declaration text at a meeting of all members today (27 November). The facilitators (Ambassador Gabriel Duque of Colombia, Ambassador Harald Neple of Norway and Ambassador Stephen Karau of Kenya) prepared this text at the request of members, after an intensive period of consultations on the shape, structure and content of a potential Ministerial Declaration. The facilitators used textual proposals made by members to develop their draft. At the request of members, they also excluded the most contentious issues from their draft, leaving them to be addressed via a separate process. The Director-General asked members to take time to consider the document over the coming days before discussing it in detail at a meeting of all members on Wednesday 2 December. He stressed that the document was a draft for consideration. He said: “This text represents the facilitators' best efforts. It is a good faith attempt to provide something that members can work with, and which — we hope — will allow for convergence on the majority of the Ministerial Declaration. As promised, this text touches specifically on the less contentious issues. And, again, as promised, the facilitators have treated members' textual proposals with the highest priority throughout. “Of course, we also need to tackle the most contentious issues — such as the reaffirmation of the Doha Development Agenda and instructions on the way forward, and openness...

Rwanda’s push to overcome international bias over the origin of its mineral exports has been hampered by the reluctance of regional countries to implement a regional mineral certification mechanism, experts say. The certification is aimed at curbing the illicit flow of “conflict minerals,” including tin, tantalum and tungsten (the 3Ts), which are Rwanda’s principal mineral exports, and gold. Twelve member states of the International Conference on the Great Lakes Region (ICGLR) agreed to a deadline of December 2015 to put in place requirements for the mechanism. Last week, the ICGLR held a meeting in Kigali where it lobbied member states to hasten implementation of the regional certificate mechanism, in order to boost its value on the international market. “ICGLR has developed a strategy that addresses cross border smuggling and levies uniform mining procedures across the region. All countries should feel the same pressure in implementing this and they should learn from the experiences of those that have done their best to put the mechanism in place,” William Aliga, chairman of the ICGLR Regional Committee on the Regional Initiative on Natural Resources, said. Partnership Africa is working with Kenya, Zambia and Tanzania to bring them on board. “We all know that December 2015 will come and go and the member states will not all have implemented the ICGLR Mineral Certification Mechanism, and then they will have to ask for an extension,” Joanne Lebert, executive director of Partnership Africa Canada said in an interview. “If the regional certification mechanism is fully implemented,...

Multinationals operating in Kenya, Tanzania and Uganda will be among the first in Africa to feel the impact of new measures to be adopted in January to curb tax losses caused by manipulation of contracts between related companies. The three countries together with Nigeria, Ghana, Burkina Faso, Senegal, Botswana and South Africa, formed a technical group that this month led to the adoption of the Base Erosion and Profit Shifting (BEPS) action by the G20, which aims to save developing countries an estimated $150 billion in tax losses, a quarter of them in Africa. “We expect to see definite improvements in revenue collection from the deterrent effect of better legislation, treaties and enhanced guidelines and transparency initiatives we are rolling out effective from 2016,” said Alice Owuor, Kenya Revenue Authority commissioner for domestic taxes. Illicit flows No reliable data exists on the extent of tax avoidance by multinationals in Kenya. However, KRA Commissioner-General John Njiraini reported in September 2013 that an audit of 40 companies mainly in the horticulture sector had reversed losses of $80 million into profits that yielded more than $40 million in tax revenue. Conservative estimates from Global Financial Integrity (GFI), a US illicit flows watchdog, has estimated Kenya’s transfer pricing-related tax losses at $115 million annually. Ms Owuor said KRA has since been conducting audits on transfer pricing and international tax after noticing anomalies in tax records of multinationals. “We have observed a worrying trend in statistics, where corporation taxes from companies doing business in Kenya constitute...

The quest by African countries to get subsidies on agricultural exports by developed countries removed is unlikely to be realised at the World Trade Organisation Ministerial Conference in Nairobi, after an informal session of delegates failed to close ranks on the matter. Export subsidies — including finance (credit, guarantees and insurance), food aid and state trading agencies — were seen as one of the difficult-to-negotiate areas at the December 15-18 meeting and members at the informal session in Geneva last week confirmed the sharp differences. “Three new proposals were submitted. Two were on export competition, pushed by several developed nations, and one on special safeguard measures for poor farmers made by the G-33 group, which includes India. But there was no convergence of views on these new proposals,” a WTO official in Geneva said. The European Union, Brazil and other countries tabled new proposals on export competition that included new flexibilities aimed at appeasing the United States. In the new proposals, the EU is willing to be flexible on issues like export credits and food aid disciplines in order to reach an export competition deal in Nairobi, but for Africa and other developing countries to benefit, the US now needs to make concessions on those issues as well. “Two aspects of the proposal that the US is unwilling to accept are its requirements that the maximum loan repayment for export financing for agricultural products be limited to nine months, and restrictions on the so-called monetisation of food aid,” said the...

IMPORTERS
have up to Tuesday to conform with new pre-shipment inspection require ments
or have their goods locked out, the Kenya Bureau of Standards and the Kenya Revenue Authority announced yesterday This is subject to the new Certificate of Conformity rule which comes into effect from December 1. It
requires all imports destined for Kenya to be inspected at the country of origin
and issued with a CoC before shipment. The two state agencies yesterday attributed the new
 directive to “key concerns” including cargo mis-declaration and under-valuation. “No cargo shall be allowed entry into Kenya
without the fulfillment of CoC requirements. Presentation of Certificates of Conformity
 shall be a mandatory requirement to facilitate clearance of imports,” Kebs managing
 director Charles Ongwae and KRA commissioner-general John Njiraini said in a
joint public notice. Cargo
 shipped prior to November 30, and not accompanied with a CoC will however be cleared,
as it will be considered to have already been enroute to Kenya, Ongwae clarified on phone. “No
cargo shipped after November 30, shall be allowed entry unless accompanied with
a Coc. Most of this cargo will however start arriving in the country from
 January next year owing to the transit period,” he said. The
directive comes as the government moves to reduce tax losses at Kenya’s
entry points and dumping of substandard and counterfeit goods. KRA
is counting on the new measures to cover tax loopholes which have denied it VAT on imports, Import Declaration Fees and the Railway Development Levy. As
at the end of October, VAT on imports was Sh47.2 billion against a...