On behalf of the British Government, I congratulate the Kenyan Government on the progress it has made this year to qualify as one of the global top ten reformers on the ease of doing business. The progress that Kenya is making against the Ease of Doing Business indicators may seem very remote from the lives of ordinary Kenyan businesses and households, but is actually very significant for three reasons. Firstly, it can result in increased domestic investment and jobs. Lets take the progressKenya has made in cutting all the red tape around starting a business, which is one of the reforms that the World Bank has recognised. In Mombasa this has brought the time down to get a Business License from 7 days to less than 1 hour, using an online platform. Evidence suggests that this can have a number of benefits: It increases the number of firms entering a market, which increases competition and productivity; it can also incentivize businesses to formalize, since the high costs of doing so are a major reason why Kenya has so many informal firms. This can then give them better access to finance and the opportunity to grow and create more jobs; and as more firms register for businesses, county governments also benefit from increased revenue. The Business permit is already the third most important source for revenue for Mombasa County. So one survey of the global evidence found that a reduction in the time to start a business by a similar amount...

Donor organisation Trademark East Africa (TMA) has claimed in court that Swiss firm Webb Fontaine misinterpreted the law in challenging its award of a Sh1.2 billion tender for the supply of a tax integration system to another firm. TMA says Webb Fontaine relied on guidelines that were not part of the bidding documents when it filed an appeal outside the seven-day window provided for after a winner is declared. The Public Procurement Administrative and Review Board (PPARB) dismissed Webb Fontaine’s appeal against TMA’s award of the lucrative deal on grounds that it had been filed after the seven days had lapsed. Webb Fontaine wants the High Court to compel the board to hear an appeal it filed against TMA’s award of the lucrative tender to French firm Bull SAS. Webb Fontaine has sued TMA, the Kenya Revenue Authority and Bull SAS. TMA is funding the installation of the Integrated Customs Management System (iCMS) in a deal with the Kenyan government. The iCMS is to replace the Simba system which cannot be integrated with the software being used by the rest of the East African Community. “Webb Fontaine exercised the option to contest the decision through TMA procurement guidelines. The TMA procurement guidelines were not included in the bid documents. The evaluation of the proposals was carried out in compliance with the requirements as set out in the bid documents,” TMA says. Webb Fontaine had lodged a complaint over the evaluation as provided for in TMA’s procurement guidelines, and expected the...

Trade along the Kenya-Uganda border at Busia is set to grow with completion of a one-stop border station by the British government. The structure which will operate 24 hours will be manned by Ugandan and Kenyan customs officers. "Our target is to cut the rate of doing trade in the border by at least 30 per cent. We plan to achieve this by automating the system of clearance and expanding the road that leads the border to a tune of Sh 200 million," said British High Commission Christian Turner during a tour of the area. The British government has set up programmes under the Trade Mark East Africa (TMA) to ease trade between the eight East African countries. "Ports and borders have been barriers to free trade in East Africa. It is 60 per cent more expensive to do business in Kenya and developing states than it is in developed countries," said Frank Matsaert, Chief executive TMA. Source: The Standard

Kenya is rooting for discussions to reduce high tariffs that make trade in agriculture expensive during the coming World Trade Organization 10th Ministerial (WTO MC 10) meeting in Nairobi. Addressing a meeting of African Union Trade Ministers and Africa, Caribbean and Pacific group (ACP) in Brussels last week, Foreign Affairs Cabinet Secretary Ambassador Amina Mohammed said a successful outcome of the WTO (MC10) must include a work programme that is realistic, balanced and that also modernises the WTO negotiating agenda. The objective of the WTO Nairobi meeting is to reduce distortions in agricultural trade caused by high tariffs and other barriers, export subsidies, and domestic support. Thus the Ministerial meeting will discuss the Doha Development Agenda (DDA), Agriculture, Market access services among other trade issues with a view of leveraging trade between the Least Developed Countries(LDCs) and the Developed countries. "The work programme would need to include agriculture, comprising an outcome on cotton; an understanding on food security; services; NAMA; trade and environment; fisheries subsidies; an expanded information technology agreement and a package for LDCs," Ms Amina said. Most African countries are classified as least developed countries. Some of the main areas of interest to LDCs include duty-free quota-free market access; the operationalization of the services waiver; simplified rules of origin; and, cotton. Some of these issues are remnants from the previous WTO Ministerial Conference, held in Bali, Indonesia in 2013 that were not fully addressed. Much of the focus at the Bali Conference was on public stockholding programmes for...

President Uhuru Kenyatta is pushing for a shift in Indo-Africa trade that will see Kenya and other African countries focus on value addition instead of exporting raw materials. For trade with India to deepen, Mr Kenyatta said, Africa must develop its manufacturing base. “Although Indo-African trade has grown significantly in the last few years, it has the capacity to grow faster, deeper and broader. But for that to happen, we must shift from the tiring and traditional focus on the export of primary commodities and develop Africa’s manufacturing base and value addition,” he said.  The President spoke on Thursday in New Delhi during the third India-Africa Forum whose theme is “Partners in Progress: Towards a Dynamic and Transformative Development Agenda”. The meeting brings together more than 40 African heads of state and government, the largest number since its launch in 2008. President Kenyatta observed that while India was the fifth largest source of foreign direct investment in Africa, there was still vast untapped potential that investors could take advantage of. “I, therefore, encourage more Indian companies to establish base in Africa as they expand,” he said. Mr Kenyatta expressed optimism that the forum would adopt a plan of action that has an evaluation mechanism to track progress on the implementation of the partnership agenda. GRANTS In his opening remarks at the forum, Indian Prime Minister Narendra Modi announced a concessional credit of $10 billion to Africa over the next five years.
India’s Prime Minister offered a further $600 million as grant...

Counties in the Western Kenya economic bloc have been challenged to take advantage of the cargo handling centre at the Kisumu International Airport. Kenya Airports Authority board chairman David Kimaiyo on Wednesday asked the counties to create products that can compete in global markets. The authority is seeking investors to set up cargo handling infrastructure at Kisumu airport, following the completion of fuel depot and cargo aprons. The two components had not been set up at the airport despite the elevation of the lakeside airport to international status. Mr Kimaiyo asked the 13 counties that form the Western Kenya economic bloc to seize the opportunity to grow economically. OPPORTUNITIES Investors in Bungoma, Busia, Homa Bay, Kakamega, Kisii, Kisumu, Migori, Nyamira, Siaya, Vihiga, Bomet, Trans Nzoia and Kericho counties stand to benefit from the centre. “They must now move with speed in their plans that will make the airport busier than it is today,” Mr Kimaiyo said when he met with Kisumu Governor Jack Ranguma, who is the chairman of the economic bloc. However, Mr Ben Kitoto, the chief executive of the Kenya National Chamber of Commerce, Kisumu arm, said the challenge was now on farmers and other investors to consider coming up with products that can be traded at the international markets. “Now that there are facilities, we ask all our members to create the products for the development to make economic sense,” said Mr Kitoto. Kisumu airport handles mainly passenger planes, which have also increased arrivals to the region...

Kenya’s remarkable rise in the latest edition of the World Bank’s ease of doing business report is a testament to the power of practical reforms in transforming the business environment. At position 108 globally in the survey covering the year ended June, Kenya has moved up 28 places from 136 the year before and is the most improved economy in Africa. The opening of Huduma centres, which avail several government services in one place, is part of the boosters that has seen the country rise in the global league table. Compared to previous years, Kenya was found to have made relatively more progress on issues like how easy it is to start a business, deal with construction permits, get electricity, register property, get credit, and pay taxes. While the reforms are commendable, the recent deterioration in the macroeconomic environment is a major damper. For reforms not anchored in sound economic fundamentals does not really help investors or indeed the man on the street. Kenya’s ballooning trade deficit, revenue shortfalls and runaway public spending have coalesced into the latest episode of a weak shilling and interest rates approaching 30 per cent. It is tough to maintain high economic growth rates in such an environment, with the key catalysts in the form of spending and investing hamstrung by the high cost of credit and imported inflation. It is therefore imperative that the government addresses the structural weaknesses in the economy. Fixing these will provide a strong base on which the business reforms...

World Bank report ranks the manufacturing sector as Kenya’s best bet to in reducing unemployment and creating more wealth should certain strategic support measures be put in place by the Government. According to the report, these measures include improved business environment, removal of market distortions that undermine competition, improved productivity and innovations, enhanced access to markets and enriched collaboration across sector levels. The World Bank’s Apparel and Textile report finds that manufacturing is crucial to job creation, industrial development, and growth, but has lately been underperforming compared to other growth sectors. Growth in the sector has been shrinking or stagnating, with figures from the Kenya National Bureau of Statistics (KNBS) showing that the sector’s growth in this year’s second quarter shrunk when compared to performance registered in the first quarter. The report highlights some of the challenges that have bedevilled the value-chains of two manufacturing sub-sectors--apparel and textile and furniture--which have by extension frustrated efforts made towards increased employment and wealth creation in the sector. The situation was aggravated by challenging in the country’s business environment, a balance of power that is skewed against manufacturing and limited collaboration across value-chains and within sub-segments of each value-chain, indicated the report. Other challenges include uncertainty around sector sustainability, dismal labour productivity, especially in the informal sector, difficulty in accessing viable markets and cheap imports, which threaten locally manufactured products. The sector was the second largest contributor to Gross Domestic Product (GDP) in 2014 and formally employed 287,500 people. However, according to Kenya...

Lake Victoria fishermen from Rhemba Island have complained that the Ugandan government is charging them hefty taxes on Kenyan waters. The fishermen told The Standard yesterday the government of Uganda had imposed a tax of Sh70,000 per fishing boat, which they have to pay in order to obtain a fishing licence in the Kenyan waters around the island. Sh60,000 is paid for a single boat, while the other Sh10,000 covers three fishermen who operate it. Led by Rhemba Island Beach Management Unit Chairman Nicholas Ouma, the fishermen accused Uganda of being unfair by encroaching on Kenyan waters. The fishermen said Uganda had deployed its police officers who carry out patrols around Rhemba Island to ensure Kenyan fishermen pay the taxes despite the fact that the island is in Kenya. “What is happening is not good because we fail to understand how Ugandan police come to Kenya and impose a tax on us. We have been fishing here for many years,” said Mr Ouma. Last Saturday, six Kenyan fishermen from Mbita were arrested. Source: The Standard

The WTO released online on 29 October 2015 new editions of its key statistical publications: International Trade Statistics, Trade Profiles, World Tariff Profiles and Services Profiles. The four publications provide detailed breakdowns of the latest data on world trade. To mark the 20th anniversary of the WTO, International Trade Statistics 2015looks back at world trade from 1995 to the end of 2014. The publication features a variety of charts to highlight the most noteworthy trends in world trade over the past 20 years. Numerous tables provide more detailed data while a chapter on methodology explains how the data are compiled. The publication is available first in electronic format, with a print version to follow in mid-November. Data can be downloaded from the WTO web site in Excel and PDF formats and from a searchable database as well as from the WTO's International Trade and Market Access Data online application. French and Spanish versions of the publication will be available online shortly. We invite you to provide your feedback on the publication by filling in the ITS 2015 Survey. World Tariff Profiles 2015 provides a unique collection of data on tariffs imposed by WTO members and other economies. It is jointly published by the WTO, the International Trade Centre (ITC) and the UN Conference on Trade and Development (UNCTAD). The first part of the publication provides summary tables showing the average tariffs imposed by individual economies. The second part provides a more detailed table for each economy, listing the tariffs it...