The government will implement a raft of measures to revive Kisumu and make it the commercial capital of the East African Community, President Uhuru Kenyatta has said. Uhuru said the Northern Corridor Integration Projects Summit will be held in the town to demonstrate the government's seriousness about elevating it. "I will talk to the presidents of our neighbouring countries so that we hold the Northern Corridor Integration Projects Summit here in Kisumu," he said. Thousands of residents lined up Oginga Odinga Street as he drove through the town on Friday after hosting the Kenya National Music Festival Winners' Concert at the Kisumu State Lodge. Uhuru, who got a rousing reception from residents of the town, was accompanied by Kisumu Governor Jack Ranguma, Kisumu Central MP Ken Obura and Kisumu East MP Shakeel Shabbir. He made two stopovers to address residents, saying the government will undertake measures including reviving industries in the town to create more jobs and wealth for the residents. Uhuru said cotton growing in the region will be revived so that Kicomi factory can be reopened. He said the shipping line that used to operate from Kisumu serving ports on Lake Victoria in Tanzania and Uganda will also be revived. More issues concerning efforts to revive the city's economy were discussed in a meeting among theUhuru, Ranguma and two Kisumu MPs. Uhuru also announced that the National Youth Service will start upgrade projects in Manyatta Slum, following the launch of similar projects in two other slums in the...

Kenya is set to become a hub for intra-regional trade in Africa, according to a new report from Frost & Sullivan. An estimated $55.6 billion in investments in infrastructure development for Kenya is planned, the majority of which will focus on telecommunications and power generation infrastructure, according to the report. Mega infrastructure projects are also planned for elsewhere in East Africa and are set to create unique opportunities and open new markets in Kenya, Uganda, and Ethiopia, the report said. Industry sectors expected to benefit from the planned infrastructure developments include oil and gas, mining, agriculture, and retail. “Transport infrastructure has undergone major upgrades over the past five years in order to support the high trade demand in the East African region,” said Craig Parker, senior economic consultant at Frost & Sullivan. “The Nairobi Southern bypass, for example, was commissioned in 2012 and is already 40 percent complete.” Major road projects that are currently underway were established to alleviate the severe bottlenecks and traffic congestion. An estimated $5.14 billion has been dedicated to road project investment in Kenya. The Nairobi Southern bypass, a freeway in Kenya’s capital, is meant to ease congestion and increase speeds on local roads. The project was 85 per cent funded by China’s EXIM Bank; the Kenyan government provided the remaining 15 per cent. However, disputes and illegal occupation of land in areas where infrastructure projects are underway, or are about to take place, have resulted in high relocation costs. This will culminate in delays along...

The Kenya Revenue Authority has reversed a directive compelling Kenyan traders to declare shipments to the east African market through its Simba system, ending a month of uncertainty. The withdrawal of a directive issued to exporters and clearing agents last month took effect on Friday. “All such goods will now be declared under the Single Customs Territory procedures only”, Mr Julius Musyoki, KRA’s acting Commissioner of Customs and Border Control, said on Friday. The taxman on July 2 ordered traders servicing the EAC markets to declare their exports on the Simba cargo clearance system amid concern over a backlog of tax refunds claims, which have remained a thorny issue for KRA and the Treasury with traders pushing for reimbursement of money owed to them. Delayed payment of tax refunds has forced some businesses to borrow from banks in order to meet their cash flow needs, adding to the high cost of doing business in Kenya. “In order to facilitate VAT refunds pertaining to exports destined to East African Community (EAC) partner states, all exporters or clearing agents will now be required to declare their exports through the Simba system while importers in the country of destination will continue lodging import entries in the ASCYUDA/TACTIS system,” KRA said in a notice to traders and agents on July 2. As at December last year the government owed traders about Sh30 billion in VAT refunds accumulated over the years partly due to lack of a reliable system to capture and audit claims by...

Kenya is set to cede regulation of its sugar industry to a regional agency in the latest bid to end a long running market access war with Uganda. The joint agency, described by the two states as "the long term solution to intermittent sugar wars", will take up the role of licensing and vetting dealers, currently undertaken by national agencies. The two states are yet to agree on the nature of the inter-state agency -- whether to make it a single entity located at border points or a joint committee made up of officials from national agencies. "We will meet in Nairobi in coming days to lay down long term solutions so that this problem does not recur," Foreign Affairs and International Trade secretary Amina Mohamed said in a statement. The sugar wars between the two countries have eluded several bilateral agreements since Kenya slapped an initial ban on Uganda sugar in 2012. "The two countries are considering formation of a joint body to manage the sub-sector in the region," Ms Mohamed said. Under the East African Customs Management Act, sugar produced in the region should be sold in any of the member states without attracting tariffs or administrative restrictions. Under pressure from farmers and millers, Kenya banned sugar from Uganda in 2012 with regulatory agencies accusing dealers from the landlocked neighbour of abusing the free trade treaty to ship in cheap sugar imported and repackaged from other regions. Kenyan millers have frequently blamed their woes on cheap sugar smuggled...

Now there is this small argument between President Kenyatta and opposition Cord leader Raila Odinga about, of all things, Ugandan sugar. Kenyatta says it makes business sense to import Ugandan sugar, because Uganda is reciprocating and will import diary and beef products from Kenya, as per the trade pact he just signed with President Yoweri Museveni in Kampala. That is better than importing sugar from Brazil, which is not buying Kenyan goods in return, and Uganda is, after all, a fellow member of the East African Community. Raila’s concern is that this will result in cheap sugar being dumped into the Kenyan market, and cane farmers will suffer. His position, though, is understandable, because the stronghold of his Cord is in the sugar-growing areas, and he is doing the right thing by them. But as an East Africanist, I am with Kenyatta on this one. First of all, just like not every country needs to make its own cars or aeroplanes, not every country needs to produce its own sugar — even if they could do it more inefficiently than Kenya’s. Thus, airlines in the Middle East and Asia, which don’t make aircraft, are using American and European planes to run more successful airlines than European and US carriers. CAPITALISM But sugar is also a metaphor for some of the surprising differences between Uganda and Kenya. If you came of age in the 1980s, there were only three “capitalist” countries in Africa: South Africa, Malawi, and Kenya. However, South Africa...

At a meeting held at Kampala Serena on Sunday, Ugandan officials and sugar industry players from the private sector complained that Kenya was blocking access to its lucrative sugar market. Foreign Affairs Cabinet Secretary Amina Mohamed, who led the Kenyan delegation to the meeting, blamed the situation on changes in the sector. She said the Kenya Sugar Board had morphed into a new agricultural organisation — the Agriculture, Fisheries and Food Authority. “There was a technical problem in the processing of permits but I would want to assure the Ugandan Government and the private sector that the issue has been dealt with." “We will meet in Nairobi in the coming days to lay down long-term solutions so that this problem does not recur,” she told the audience mainly from the Uganda Manufacturers Association. It was not the first time the lobby group was voicing concern. Ugandans had previously complained that despite the East African Community Common Market Protocol, Kenya is not allowing Ugandan sugar into its territory. Kenya exports about $700 million (Sh70 billion) worth of goods to Uganda, but it buys only Sh18 billion from the same country. Last year, Ugandan traders petitioned their government to impose similar restrictions in the name of balance of trade. The traders charged that Uganda should start doing more business at the Port of Dar es Salaam than Mombasa until Nairobi behaves. UNDER PRESSURE So, when President Uhuru Kenyatta was in Uganda for a three-day State visit early this week, he was under...

After missing the 2010 deadline, the Southern African Development Community (SADC) will now negotiate a new target date for the transformation of the organisation into a Customs Union (CU), during the 2015 Ordinary Summit. A CU is where a group of countries that have established a free trade area agree on common external tariffs and a common external trade policy, in a bid to drive increased trade and economic development in the region. Originally scheduled for 2010, the formation of CU is seen as key to deepening regional integration before the region incrementally moved towards a common market and a monetary union. Briefing the media on standing committee meetings being held in Gaborone ahead of next week’s Summit, SADC Director of Policy, Planning and Resource Mobilisation, Dr Angelo Mondlane said although the original target was not met, significant progress has been made towards regional integration efforts with all but two of the SADC members now part of a Free Trade Area (FTA). “We have not set a new deadline for transforming into a customs union. It is one of the items to be discussed here as we realised that operating without a target is not very helpful,” he said. The Heads of State and Government Summit will take place in Gaborone from August 17-18, 2015. According to Mondlane, there are numerous reasons why the original target was not met, which include overlapping membership with some SADC countries belonging to multiple organisations such as East African Community (EAC) and Comesa. Under...

Uganda will host the first East African Community manufacturing business summit and exhibition in early September. According to the organisers - the EAC secretariat and East African Business Council (EABC) - the summit aims to promote East Africa as an attractive and competitive hub for manufacturing hub. James Mutende, the minister of state for Industry, said the manufacturing business summit is a platform to show how the East African bloc can grow through a diversified manufacturing sector. "The manufacturing summit will be held at Speke Resort hotel, Munyonyo, and the exhibition will be graced by President Yoweri Museveni. We expect the presence of international and regional development partners and captains of industries in the region," Mutende told the press at the Media Centre recently. Jean Baptiste Havugimana, the director of products at the EAC secretariat, said the summit was expected to unveil new possibilities of manufacturing within the region and generate solutions and strategies to address any shortcomings within the sector. "The contributions of industries to the GDP in all the countries in the region is only 10 per cent, according to reports from International Monetary Fund and EAC data, but through such summits and discussions we want to see that the contribution increases to 25 per cent in the near future," Havugimana said. "Our strategic plan at the EAC secretariat is to ensure that the manufacturing sector is on the frontline in driving the economy..." Shem Bageine, Uganda's minister of state for EAC, said the two-day event would have...

Receives proposals for setting up two plants for processing of rice and beans in Rwanda, a sugar refinery in Tanzania, a pulses processing plant and a unit to process animal products. As many as five projects are under consideration now for investment in East African countries that will be facilitated under the Supporting Indian Trade and Investment for Africa (SITA) project. Govind Venuprasad, co-ordinator, SITA office for Asia and the Pacific, told The Hindu here on Tuesday that in the last four months, SITA had received proposals from mid-sized Indian companies for setting up two plants for processing of rice and beans in Rwanda, a sugar refinery in Tanzania, a pulses processing plant and a unit to process animal products. The approximate investment of these projects was expected to be $18 million. Earlier, speaking at a meeting organised by Confederation of Indian Industry (CII) here, he said countries covered under the SITA project were India, Ethiopia, Kenya, Rwanda, Uganda and the United Republic of Tanzania. The implementation phase for the project started in April this year and would be on till March 2020, and the focus sectors include leather, cotton, textiles, apparel, coffee, spices, essential oils, IT and ITES, and pulses. The Exim Bank was keen and was open to supporting bankable projects, he said. Indian partners and companies can look at investment, export of products and capital equipment, and technology and knowledge transfer to these countries. Rajesh Aggarwal, chief of trade facilitation and policy for business, International Trade Centre,...

THE Common Market for Eastern and Southern Africa (COMESA) has conducted training workshops for stakeholders in transit trade in preparation for the implementation of regional trade facilitation instruments. The objective of the training is to prepare key stakeholders involved in transit trade in Zambia with knowledge and skills to implement the COMESA Virtual Trading Facilitation System (CVTFS). The CVTFS is a trade facilitation technology that provides a single electronic platform for processing various transit trade instruments, including transit bonds, cargo tracking, overload control and insurance, among others. COMESA secretariat public relations officer Mwangi Gakunga said the commission had in May this year conducted six training workshops for stakeholders in transit trade in preparation for the implementation of regional trade facilitation instruments. He was speaking in a statement released in Lusaka. Mr Gakunga said the training also covered the Regional Customs Transit Guarantee (RCTG) scheme, commonly known as the CARNET, which is a customs transit regime designed to facilitate the movement of goods under customs seals in the COMESA region and to provide the required customs security and guarantee to the transit countries. "The training was also triggered by the signing of a Memorandum of Understanding between Zambia Revenue Authority and COMESA in May this year, for the implementation of the CVTFS," he said. Mr Gakunga has since refuted media reports that COMESA had been holding secret workshops to promote its trade facilitation instruments. He said the workshop addressed inherent fears among Clearing agents that the implementation of the systems, especially...