The East Africa Business Council wants countries which have not joined the regional electronic cargo tracking system (RECTS) project to do so sooner than later as the latter is considered to be effective in safety of goods while in transit. Urging Tanzania and Burundi to join Rwanda, Uganda and Kenya in embracing a harmonized electronic cargo tracking system, the apex body of business associations of the Private Sector and Corporates from EAC partner states, is emphasizing that the system reduces the cost of doing business. The EABC Executive Director Lilian Awinja has reiterated that RECTS is, among others, “a very good idea that is reducing diversion and theft of transit cargo.” “Uganda, Kenya and Rwanda are already on board, and this is something we appreciate because it adds value to the Single Customs Territory (SCT),” Awinja said, adding that the EABC needs the revenue authorities in the two other countries to “take up the cost of that gadget because it is in their best interest to have these gadgets on the trucks.” “What we need is to see Tanzania and Burundi join the regional cargo tracking system. The revenue authorities should support this whole process and make sure that they own it and we work together as a region, so that it is implemented uniformly across all partner states. We are supposed to work together. We are in a Customs Union.” Rwanda launched the e-Cargo tracking system which is funded by the UK Department for International Development (DFID) through Trademark...

Political jitters scared away traders from neighbouring countries, denying Kenya a massive Sh7.8 billion in exports and re-export earnings. This is according to the latest data from the Kenya National Bureau of Statistics (KNBS). The Latest Economic Indicators, August 2017, shows that Kenya lost Sh6 billion in re-exports and another Sh1.8 billion in exports between January and July 2017, leaving a huge hole in the country’s exchequer. Re-exports- or export of imported products, particularly to landlocked countries in the region- took the biggest hit as traders opted for a different route. And the likeliest route chosen by these traders, analysts noted, was Tanzania’s Central Corridor served by the Port of Dar es Salaam. Between January and July, 2017 re-exports declined to Sh38 billion from Sh44 billion it managed in the same period last year, as political temperatures rose. And with the October 26 elections cast into doubt after former Prime Minister Raila Odinga opted out of the race, things could get worse. Kenya’s re-exports into neighboring countries includes petroleum products and manufactured articles. Although re-exports have generally been slowing down, a dip of 11 per cent during this period was significant compared to a marginal decline of 1.8 per cent in the same period in 2016? In 2016, a 12.1 per cent decline in the value of re-exports contributed to a decline in the value of total exports from Sh581 billion in 2015 to Sh578.1 billion. “The decline in re-exports was attributed to a contraction in the re-exports of petroleum...

This was a declaration made by over 300 delegates from Africa and international players in grain industry during the closing of the 7th African Grain Trade Summit in Dar es Salaam. The summit was held under the theme: “Setting New Horizons to rethink Grain Trade for Food Security and Prosperity in Africa,” and was opened by the Tanzania  agriculture minister, Dr John Tizeba. The EAC Partner States with the threat of high population growth were urged to borrow a leaf from emerging developed economies such as Brazil and Mexico who have transformed their people through agriculture. “African economies heavily rely on agriculture as a major source of income, but untapped potential has resulted in persistent poverty and limited wealth creation,” Alehandro Terminel, the chairperson of the board of the Terra Wealth Trader Company, Mexico told delegates . Terminel observed that the continent’s food security has declined over the past five decades despite interventions from governments, the private sector and development partners. “Africa has a rapid population growth of which 60% are under the age of 25 with higher preference for rice consumption than maize. This calls for crop diversification to meet consumer needs within and outside the continent,” he stated. The delegates observed that the infrastructure remains a top issue in the region with some agricultural areas with high potential of agricultural production still inaccessible. “In the Great Horn of Africa, some states are still volatile and this has hampered development and social well-being of the grain sector in the region,” Yohannes...

Ethiopia, whose economy recently overtook Kenya’s, is now the fastest-growing economy in sub-Saharan Africa, according to a new World Bank report. This means Ethiopia’s economy will further stretch its lead on Kenya’s even as the latter grapples with economic headwinds, including heightened political temperatures that have left investors jittery. “Ethiopia is likely to remain the fastest-growing economy in the region,” noted the Africa’s Pulse Report released yesterday. The International Monetary Fund (IMF), another Bretton Woods institution, projects Ethiopia’s economy to grow by 8.5 per cent this year, three percentage points higher than Kenya’s, which is expected to grow by five per cent. The Bretton Woods institution noted the growth came about despite the expected slowdown in public investment. Ethiopia’s economy overtook Kenya’s, with the country’s Gross Domestic Product (GDP) - or the total value of goods and services produced annually - hitting Sh7.4 trillion last year compared to Kenya’s Sh7 trillion in the same year. And although the report projects Kenya’s growth to recover as inflation eases, recent developments on the political front have left the country’s economy in a precarious position. Already, GDP growth in the second quarter of this year slowed, growing by five per cent compared to 6.3 per cent in the same quarter last year as agriculture, manufacturing and financial services all took a beating. It was the slowest Q2 growth since 2012 when the economy expanded by 4.3 per cent. A drought, which swept across the whole of the Horn of Africa, is to blame...

The main civil works for the new Sh48 billion Mombasa-Nairobi pipeline is now 95 per cent complete, Kenya Pipeline Company has said. KPC Managing Director Joe Sang yesterday said the project, called Line 5, will be commissioned by December this year. The final testing being undertaken on the project ahead of the commissioning will include hydro-testing, station mechanical and electrical works. Sang’ said Line 5 will have the capacity to pump 1,000 cubic litres ( 1 million litres) of oil per hour from Mombasa to Nairobi. Currently, KPC pumps 80 per cent of all imported oil products in the country with the remaining 20 per cent being transported by road. “This new Line 5 project will be running concurrently with the Old Line 1, which was put up in 1978. This therefore means that we will eliminate transportation of oil products by road in Kenya,” said Sang. Sang said Kenya lost several East and Central African markets after Line 1 became small and could not adequately supply the region. Last financial year, KPC transported 6.3 billion litres of oil from Mombasa through line 1. Sang’ said they expect to transport millions of litres once the new Line 5 is commissioned. At the same, he said they are putting up additional four-tank storage facility in Nairobi with a capacity of 133 million litres. Currently, KPC has a storage facility of 100 million litres in Nairobi. “We will have a total storage facility of 233 million litres. Nairobi consumes about 60 per...

High trade facilitation costs and poor logistics services are hampering foreign direct investment and growth in the east African region, a senior Kenyan official said on Tuesday. Principal Secretary for Trade Chris Kiptoo said smooth logistics not only reduces the cost of imports but is vital to producers to be able to participate in global production circles and eventually move into new business. “Improving logistics includes several dimensions such as enhancing logistics capabilities, the development of rehabilitation of physical infrastructure, and the streamlining of trade-related procedure,” said Kiptoo during the launch of the 2017 logistics performance survey in Nairobi. The report, released by the Shippers Council of East Africa (SCEA), said the climate of conducting business has improved in the region, thanks to right policy choices, the rise in intra-regional trade, and an enabled private sector. The report, which analyzed the performance of trade logistics with respect to indicators of time, cost and complexity against those of the world’s leading trade hubs, indicates that reforms initiated by the region’s member states are finally paying off. “We will use the indicators to interpret the performance of the logistics chain, reveal to both policy makers and businesses the full extent of bottlenecks, and propose appropriate redress measures,” Gilbert Langat, the CEO of the Kenya Shipper’s Council, said during the commissioning of the study. Road freight costs have fallen “due to improvements made in road infrastructure, reduction in the number of police checks and enhancement of weighbridge efficiencies through automation,” Langat said. “However,...

East African Community (EAC) customs officers are meeting in Kigali to discuss incorporation of the Green Customs Initiative into national custom training curricula to enable them meet their obligations under international environment agreements. The Green Customs Initiative is a partnership designed to enhance the capacity of customs and other relevant border control officers to monitor and facilitate legal trade and to detect and prevent illegal trade in environmentally-sensitive commodities covered by trade related conventions and multilateral environmental agreements (MEAs). The three-day workshop,  organised by the United Nations Environment Programme (UNEP), has brought together around 50 customs officers from Rwanda, Kenya, South Sudan, Tanzania, and Uganda, to talk about environmental crime in detail. Officials said on Wednesday that it is also meant to facilitate the inclusion of Green Customs Initiatives as a regional programme involving custom officers. Colette Ruhamya, Director General of the Rwanda Environment Management Authority (REMA), said that most environmental problems encountered in the world today have a trans-boundary nature and a global impact. She said these environmental problems can only be addressed effectively through international co-operation and shared responsibility made possible through multilateral environment agreements, several of which regulate the cross-border movement of items, substances and products, mainly in the form of imports, exports and re-exports. “This gives customs and border-protection officers’ responsibility to control trade across borders, a very important role in protecting the national and global environment,” Ruhamya said. Environmental crimes are illegal acts which directly harm the environment, she said. They include: illegal trade in...

The planned extension of the Standard Gauge Railway (SGR) to Kisumu has rekindled hope for regional trade as the lakeside city consolidates its market position as one of the leading business hubs in East Africa. Even though the SGR is targeted to be built up to the border town of Malaba, experts say linking Kisumu port to Mombasa is seen as an early landmark as it will allow cargo to be transported over lake Victoria to other East African states, making the SGR a more viable economic project. The SGR extension coincides with the construction of a lake port planned on the shores of Lake Victoria in Usare village, boosting trade with Kenya’s regional neighbours via Uganda’s Port Bell, Tanzania’s Mwanza Port with South Sudan via Jinja Port and Rwanda via Kimondo Bay. For decades, Kisumu port registered robust business helped by a reliable railway system and maritime vessels that ferried cargo to ports such as Mwanza and Bukoba in Tanzania and Jinja and Port Bell in Uganda. Locals say the modern container port is likely to turn the town into a hub for trade. This comes at a time when navigation of boats and fishing vessels has been constrained by hyacinth invasion in Lake Victoria. However, Kisumu port’s potential of receiving and processing over 4,000 tonnes of cargo to other East African countries including Tanzania, Uganda and Rwanda daily could be halved due to the water weed. Based on its location, Kenya Chamber of Commerce and Industry branch chairman...

The firm which started operations in Kenya in 2009, says the newly introduced engineering insurance segment will be very instrumental in helping it boost market share. Continental Re says that some huge infrastructure projects have not been adequately covered by local players. Newly appointed managing director Souvik Banerja said that they will be targeting the standard gauge railway and wind power projects. Plans are underway to extend the SGR from Naivasha to Kisumu. “These projects will all need expensive machines. They will surely need insurance services and we do not they that they have been adequately covered,” said Mr Banerja. In recent years Kenya has witnessed heightened construction and mining activities. In northern Kenya British exploration firm Tullow Oil is making discoveries that could make Kenya a major oil producer. Already the company has contracted Dubai-based Almansoori Petroleum Company to supply an Early Product Facility (EPF) at a cost of $10 million, to help it extract crude in South Lokichar in Kenya’s north, even as uncertainty surrounds the Early Oil Pilot Scheme. The deal with the Dubai company was signed early this year as part of the wider processes in the run up to early production, which has run into trouble after the government shelved it citing logistical challenges. On the other hand, the construction of the LAPSSET project is gaining momentum after construction of the first three terminals of the new Lamu port reached 40 per cent completion this week. LAPSSET project director Sylvestre Kasuku said the first terminal will be...

The governments of Kenya and Japan have signed a Sh35 billion loan facility for construction of phase two of the second container terminal at the port of Mombasa – paving the way for the launch of a project that seeks to boost efficiency at the busy port. According to the Kenya Ports Authority managing director Catherine Mturi, the signing of the deal will enable the contractor to kick off works on site by January next year. “We already have the Sh35 billion financing from the Japanese government. We are now in the tendering process but construction must commence by January 2018,” Ms Mturi said in an interview last week. The deal comes exactly a year after the September 2016 completion of phase one of the second container terminal project, which raised Mombasa port’s cargo handling capacity by 550,000 Twenty-Foot Equivalent Units (TEUs). Phase two of the second container terminal is, on the other hand, expected to provide an additional capacity of 450,000 TEUs. The initial phase of the project was built at a cost of Sh28 billion. The new terminal which is being built on 100 acres at Kilindini Harbour is expected to ease congestion at the Mombasa port, making the facility more competitive amid growing competition from the port of Dar es Salaam in neighbouring Tanzania. On completion, the facility will have three berths with quay lengths of 230, 320 and 350 metres. The larger berths will handle Panamax container ships of 20,000 dead weight tonnes (DWT) and Post Panamax...