Kenya Pipeline Company (KPC) recently announced completion of a new oil loading jetty at their Kisumu oil terminal. This introduces an alternative regional oil export option across Lake Victoria. It revives the lake petroleum transport infrastructure that collapsed in 1977 when the EAC acrimoniously wound up. KPC must now market the jetty to the lake neighbours to ensure that it becomes part of their oil imports options. For logistics completeness, there must be barges (small tankers) on the lake. In the old days we had MV Nyangumi that ended up with Tanzania when the EAC assets were shared. There must also be counterpart oil jetties in good condition at various lake ports ready to safely receive and discharge products into bulk oil terminals at those ports. I am here talking of Mwanza, Musoma and Bukoba in Tanzania; and Port Bell and Jinja in Uganda. Further, the transport economics must be competitive enough to incentivise importers to use the lake option in place of road transport from KPC depots at Kisumu/Eldoret or from the port of Dar es Salaam. Above all, the regional governments of Tanzania, Uganda and Rwanda will need to give a “political” nod to the lake imports option as this has to be incorporated into their national petroleum imports and customs revenue collection systems. Tanzania, like Kenya, has a centralised petroleum imports tender system which defines official oil imports entry points for the purposes of retail price calculations and regulation. Uganda has been working on a petroleum distribution...

The recent shake-up at the Kenya Ports Authority (KPA) is welcome, provided it improves service delivery and eases operations. There is hope that the new bosses will get what they need to do their work as expected. The new team would be advised to work knowing that the State retains the right to the source for personnel globally in the event they fail to deliver. The expectation is that the port’s management will move quickly to meet the challenges facing cargo owners such as high charges and bureaucracy. In instances where State agencies such as Kenya Bureau of Standards and Kenya Revenue Authority, undermine the operations at the port, KPA should blow the whistle in time. Failure to do so would leave management holding the bag for other agencies’ shortcomings. The good news is that KPA is alive to these challenges as manifested by its decision to reduce its cargo handling charges by as much as 23.5 per cent for cargo destined for the local market and by almost a third for goods being re-exported to the region. Export goods This is expected to boost the volume of cargo passing through the port at a time when Tanzanian ports have heightened competition for import and export goods to and from the region. The Dar government is so serious about eating Kenyans’ lunch that it is not only modernising Tanga and Dar-es-Salaam ports but has also reduced charges on cargo imported and exported through its facilities. It has also reduced charges...

Visiting Congo Brazaville Minister for Territorial Development and Large Public Works , Mr Jean Jacques Bouya has commended the Kenya government for completing the modern Standard Gauge Railway (SGR) phase one linking the Port city of Mombasa and the capital, Nairobi. The visiting minister rode on the SGR passenger train from Nairobi to Mombasa arriving at the Mombasa Terminal at 1.45 pm on Sunday. ''We are delighted at the new service and hope that it shall help join Kenyan and the neighbouring countries in the region as we seek to bolster trade,'' he said. On hand to receive and show him around the SGR installations were Principal Secretary in the Transport Ministry, Prof Paul Maringa , Kenya Railways Managing Director, Atanas Maina and senior officials from the China Road & Bridges Corporation (CRBC) . ''The visiting Minister and his delegation are keen to see the Kenyan SGR whose first phase is complete connect East Africa through Mombasa Port under the one belt road initiative,'' Maina said. Railway planners in Africa are keen to have a direct rail link from the Port of Mombasa on the Indian Ocean join another similar one to be developed in countries of Central Africa, the Congos to terminate at Pointe Noire on the Atlantic Coast. In Mombasa, the visiting minister toured the Port of Mombasa where he was met by Kenya Ports Authority (KPA) Managing director, Ms Catherine Mturi- Wairi. While the SGR passenger train has been recording impressive passenger loads between Mombasa and Nairobi...

Kenya has won a major diplomatic battle against neighbouring Tanzania after Uganda announced it would ship out its early crude oil exports through Mombasa port. The decision puts Uganda on course to becoming the first East African nation to export crude oil and marks a big diplomatic win for Nairobi, which has been feeling lonely after Uganda opted to team up with Tanzania in the construction of a pipeline to export its oil. The Uganda National Oil Company (Unoc) in January invited bids from freight operators to haul its initial consignments of crude oil that was produced during well testing of the Albertine Graben oilfields. “The Unoc intends to dispose of 45,211 barrels of test crude in the Albertine Graben,” the State-owned company said in a notice that requires investors to issue a bid security of $10,000 (Sh1 million). The bidding window closed on Friday and will be followed by evaluation and award of contract at the end of next month — paving the way for the trucks to hit the road. The decision has put Kampala in competition with Nairobi for East Africa’s first petrodollars. Abandoned Kenya Uganda’s decision to use the Mombasa port for its early oil shipments comes two years after it abandoned Kenya in the planned construction of a joint crude oil pipeline through Kenya’s Northern Corridor. The pipeline was to run from Uganda through Kenya’s Lokichar basin in Turkana to the proposed Lamu port. Kenya opted to forge ahead with the plans to build the...

When Djibouti makes international headlines, it is usually in connection with the many superpowers that have built military bases on its shore. France, the United States, China, Italy and Japan all have a major military presence in the tiny East African nation. But for Djibouti's government, there is another major power that is even more important: Ethiopia. It is difficult to overstate just how dependent Djibouti's economy is on its much larger neighbour. There is almost no fresh water in Djibouti, so it must import water from Ethiopia. Most of its electricity comes from Ethiopia too. Little grows in Djibouti's arid desert landscape, so fresh fruits, vegetables and grains are trucked across the Ethiopian border every day. Economically, by far Djibouti's most valuable assets are its ports. But these too are almost entirely reliant on a healthy trading relationship with Ethiopia, which, being landlocked, requires an outlet to the sea. Ethiopia is an anchor in the Horn of Africa - any disruption will have knock-on effects More than a century ago, when the old Port of Djibouti was built by the French colonisers, it was connected with a railway that linked Addis Ababa to Djibouti City. Given the size differences of the two countries - today Ethiopia's population is more than 100 million, while Djibouti's is less than 1 million - the port was never about trade with Djibouti, but trade with Ethiopia. It is no coincidence that today, the new Doraleh Container Terminal is the end of the line...

President Trump has reportedly decided to impose new tariffs of 25 percent on imports of steel and 10 percent on imports of aluminum. This comes after the Commerce Department conducted two lengthy — but mostly closed-door — investigations under Section 232 of the Trade Expansion Act of 1962. Under this law, Commerce Secretary Wilbur Ross concluded that imports of steel and aluminum threaten America’s national security and recommended that Trump impose comprehensive new import restrictions. Imposing trade restrictions to protect national security would be an unprecedented shift in U.S. policy. While there have been many historical episodes of the U.S. steel industry demanding — and being granted — import protection of some form, what is taking place this time is truly different. This kind of protection would have tremendous economic and institutional repercussions well beyond the two cases currently on Trump’s desk. Here are five reasons for that: 1) This cuts a significant amount of imports. The two investigations cover about 2 percent of total U.S. goods imports in 2017: Imports of steel were $29 billion and aluminum $17 billion. These two are the largest of all trade investigations the Trump administration has conducted — each involves much more trade than the combined imports hit by Trump’s tariffs on solar panels and washing machines, announced in January. And the proposed cuts in imports are sizable. Trump’s tariffs would go further than Ross’s recommendations, which aimed to slash steel imports by 37 percent and aluminum by 13 percent. New tariffs would probably...

Africa Ministers of Trade have approved an agreement to give local traders access to the continental trade market, trade Principal Secretary Chris Kiptoo said. Describing the move as a big achievement for Africa’s regional integration efforts, Kiptoo, on his official twitter account said the agreement is now awaiting approval by Africa heads of state. “Today in Kigali, Africa ministers of trade approved the agreement establishing the Africa Continental Free Trade Area expected to be signed during Extra Ordinary Summit of AU on 21 March 2018,” he said. The ministerial approval came six years after the decision to form the free trade area was adopted during the 18th ordinary session of the Assembly of Heads of State and Government of the African Union held in January 2012 in Ethiopia. Cabinet Secretary Industry, Trade and cooperatives Adan Mohamed led a Kenyan delegation to the two day conference which aimed at adopting the agreement which has detailed legal measure on how the trade will be practiced. Some of the protocols and Annexes in the agreement include Protocol on Trade in Goods, Protocol on Trade in Services, and Protocol on Dispute Settlement. “The AFCFTA will bring together 55 African countries with a combined population of more than 1.2 billion people, with a vibrant and growing middle class, and a combined gross domestic product of more than Sh344.08 trillion ,” Mohamed said According to a statement from the Ministry of Trade, Industry and cooperatives, the agreement, once signed by the Africa heads of state, will...

The African Development Bank (AfDB) has said it is in talks with its Governors to unravel strategies that are effective and efficient in closing Africa’s $170 billion infrastructure investment gap. The bank also canvassed for support among its East and North African Governors on the need for urgent measures to match the continent’s growing population and youth unemployment, which it likened to a “ticking time bomb.” At a two-day consultation at the bank’s headquarters in Abidjan, CÕte d’Ivoire, they however, described the continent’s growing young population as a potential growth engine for the world, when harnessed. AfDB President, Akinwumi Adesina, said the good news is that the solution is within our reach and will require investments. Already, to bridge the investment gap, ensure inclusive growth, and create employment for the continent’s population, the meeting endorsed the African Development Bank-led African Investment Forum and described it as a timely opportunity to catalyse investments into projects and attract social impact financing to Africa. Tanzania’s Minister for Finance and Planning, Isdor Mpango, called for closer involvement of the private sector in financing development on the continent. “The African Development Bank is well positioned to advise and assist governments and the private sector to come up with bankable projects,” Mpango said, calling for “direct resources to provide budget support and investment opportunities.” Through the AIF scheduled for November 7 to 9, 2018, in Johannesburg, South Africa, the region’s development bank and its partners intend to showcase bankable projects, attract financing, and provide platforms for...

East African Development Bank (EADB) has secured a Sh1.5 billion ($15 million) loan from the Arab Bank for Economic Development in Africa (Badea) for onward lending to traders in Kenya and other member countries. The purpose of the credit is to enable EADB finance imports from eligible Arab exporters to particular importers in the East African Community (EAC) countries. EADB – owned by Kenya, Uganda, Tanzania and Rwanda – usually funds regional projects in infrastructure, manufacturing, agribusiness and education sectors. “We have continued to build relations with new lenders and development partners. To this end, the Arab Bank for Economic Development in Africa (Badea) has established a line of credit with the EADB of an amount of $15 million,” said EADB director-general Viviane Yeda in a statement. As at end of 2016, the EAC member states had a stake of 87.3 per cent, with African Development Bank (AfDB) holding most of the remaining shares through its 8.8 per cent shareholding, callable capital, technical assistance and funding lines. The EADB strategic plan for the period 2016 to 2020 follows a period of business growth over the previous plan period 2011 to 2015 and an in-depth review of EADB operations and related operations policies in 2015. In December last year, Global Credit Ratings (GCR) affirmed the long-term and short-term national scale ratings assigned to the regional lender of AA+ (UG), (KE), (TZ), (RW), and accorded it a stable outlook, besides affirming its foreign currency international scale rating of BB+. Source: Business Daily

The East African Community member countries have been asked on to increase intra-regional trade so as to support the industrialisation agenda of the region. According to statistics from the World Bank, Africa’s share of global trade was at 2% three years ago and has gone down further by a percentage point. This means that the rest of Africa is growing its share in global market while Africa is not. This is backed by reports that the amount of trade Africa does within itself compared to other regions is low at 11%. Ali Mufuriki, a businessman and board chairman of Trademark East Africa, said Europe is at 60%, Asia has 60% and yet these do not have a free trade area. He made the remarks during the opening of the East Africa Trade and Development Forum recently. The event was organised by the trade ministry with support from Trademark East Africa. The two-day forum was aimed at creating a platform for partners and stakeholders in trade development to review, reflect and exchange ideas on the progress of Trademark East Africa and its partners. Mufuruki said for the region to achieve its industrialisation potential, there is need for member states to focus on the production of high value goods. People should be empowered with skills that will enable them work, own and drive the industries, which will in turn create jobs. He noted that EAC regional trade may not grow if cross border trade is one sided. Mufuruki cited the example of...