EGYPT — African leaders signed on Wednesday a potentially historic 26-nation free trade pact to create a common market spanning half the continent from Cairo to Cape Town. The deal on the Tripartite Free Trade Area (TFTA) caps five years of negotiations to set up a framework for preferential tariffs easing the movement of goods in an area home to 625-million people. Analysts say the pact could have an enormous impact for African economies, which despite growth still only account for about 2% of global trade. The TFTA pact was signed by Egyptian President Abdel Fattah al-Sisi, President Robert Mugabe of Zimbabwe, Prime Minister Hailemariam Desalegn of Ethiopia and Mohamed Bilal, vice-president of Tanzania, at a summit in the Red Sea resort town of Sharm el-Sheikh. But hurdles remain, with the timeline for bringing down trade barriers yet to be worked out and the deal needing ratification in national parliaments within two years. "What we are doing today represents a very important step in the history of regional integration of Africa," Mr Sisi said as he opened the summit. Addressing the summit, World Bank president Jim Yong Kim said the TFTA would allow Africa "to make tremendous progress and move the entire continent forward". "Africa has made it clear that it is open for business," he said. The deal will integrate three existing trade blocs — the East African Community, the Southern African Development Community and the Common Market for Eastern and Southern Africa (Comesa) — whose countries have a...

(Bloomberg) — A.P. Moeller-Maersk A/S, owner of the world’s largest shipping container line, is seeking to win contracts to build and upgrade ports in Nigeria and Kenya as the Danish company expands its African operations. Maersk is awaiting a final sign-off on a contract to help build a new port in Badagry in Nigeria’s southern Lagos state, according to Lars Reno Jakobsen, the company’s senior vice president for Africa. “That project, once it’s been finalized, could be more than $2 billion in terms of investment,” he said in an interview at the World Economic Forum in Cape Town on Friday. “Hopefully we can start some time this year. It will provide capacity, not only for containers, but also for oil, break-bulk and offshore.” Maersk employs almost 10,000 people in more than 40 African nations and generates about 10 percent of its sales in and around the continent. Besides its shipping business, the Copenhagen-based company supplies oil- and gas-related services. The company’s APM Terminals unit operates 10 West African ports. “We are actively looking in East Africa for opportunities,” Jakobsen said. “There is an ongoing tender process for the port of Mombasa, where APM Terminals has shown interest” in operating two new berths in the Kenyan city." Maersk is also working on a $1 billion expansion to Ghana’s Tema port in collaboration with the west African nation’s ports authority. The project includes the construction of four new berths and will more than quadruple the port’s capacity. Africa Sales In 2013, Maersk...

The leaders of 26 African nations have been laying the groundwork for an African Free Trade Union in the resort of Sharm El-Sheikh in Egypt. Behind closed doors ministers of the three African economic blocs: the Common Market for Eastern and Southern Africa (COMESA), the South African Development Community (SADC), and the East African Community (EAC) have been discussing the deal that is expected to be signed on Wednesday (June 19). The merger of the three groups will see a trade zone that expands from from Cairo to Capetown representing 60 percent of the continents GDP and 52 percent of its population. Francis Mangeni is the Director of Trade, Customs and Monetary Affairs for COMESA: Speaking to euronews he said: “This is a landmark. It’s a milestone in the history of Africa; and the reason why is because you now are going to have a free trade area, a single economic space covering half of Africa, so that’s unprecedented.” Once signed a timetable for implementing the agreement will be decided at a later meeting. euronew’s correspondent in Egypt, Mohammed Shaikhibrahim said: “Access to economic integration between African countries still faces many difficulties, notably the readiness of the infrastructure of these countries, specifically in the field of transport, telecommunications and energy” Source: Euro News

THE Zambian government must ensure that the hedging mechanism used in contracting concessional loans for infrastructure development is well managed, says the Development Bank of Southern Africa. And former British prime minister Gordon Brown says Africa needs to spend US $1.5 trillion to plug the continent’s infrastructure gap. DBSA managing director Patrick Dlamini said the Zambian government should ensure the hedging mechanism used in contracting concessional loans was well managed so that commercial viability of Zambia’s infrastructure projects is maintained in the face of continued currency volatility and imminent debt repayments. “I think what is important on the capital markets and Eurobond and sustainability of debt repayment by the countries is to try and manage the currency risks, especially if we were to raise bonds in euros and coming to fund a project inside Zambia. It has got to be well-managed to make sure that the commercial viability of the project is well protected,” he said during a press conference at the just-ended World Economic Forum on Africa 2015 in Cape Twon." Dlamini said investment in economic infrastructure was important if Zambia was to sustain its debt repayments because this was where revenues can easily be generated. “It is quite important that [investment] especially in economic infrastructure, [which] has the ability to generate their own revenues and hence can be able to serve the debt associated with the funding of this infrastructure,” added Dlamini. And speaking earlier, Brown told the media that Africa needs to increase its spending on infrastructure...

The East African Community (EAC) and the World Bank today hosted a convention to assess the challenges and opportunities in improving connectivity along key trading corridors to facilitate regional integration in East Africa. The Integrated Corridor Development convention, held at the UNESCO headquarters, brought together representatives from major bilateral and multi-lateral donor organizations, to discuss solutions to facilitate the funding of corridor development in land-locked countries, such as Burundi, Rwanda and Uganda. "In East Africa, high transport costs, poor infrastructure and underdeveloped logistics services limit the competitiveness and inhibit the integration of both the landlocked and transit countries into the regional and global market. Increasing the integration between the different modes of transport through development corridors can significantly improve connectivity and contribute to higher growth in the region," said Pierre Guislain, senior director for the World Bank's Transport and ICT Global Practice. The event comes as a follow up to the third EAC Heads of State retreat on infrastructure development and financing, held in Kenya in November 2014, where EAC leaders endorsed a strategy and action plan to improve the quality of service, and reduce the costs of transport, through developing better links between the different modes of transport along the key trading corridors of the region. The strategy, which the EAC Secretariat was tasked to implement, focuses on improving intermodality for freight transport along the Northern and Central Corridors, from the maritime ports to the inland lakes of Victoria and Tanganyika. "The EAC views the implementation of the Intermodal...

Djibouti’s President Ismail Omar Guelleh and Ethiopia’s Prime Minister Hailemariam Desalegn will attend the ceremonial laying of the last track Thursday in a 752-kilometer (467-mile) railway, financed and built by China, linking the port capital of Djibouti with landlocked Ethiopian capital Addis Ababa. The first scheduled train is expected to use the desert line in October, reducing transport time between the capitals to less than 10 hours, rather than the two days it currently takes for heavy goods vehicles using a congested mountain road. “Some 1,500 trucks use the road every day between Djibouti and Ethiopia. In five years, this figure will rise to 8,000,” said Abubaker Hadi, chairman of Djibouti’s Port Authority. “This is not possible, this is why we need the railway.” The new line is a restoration of an old one, built in 1917 by the Franco-Ethiopian Railway Company, that fell into disrepair and only worked erratically. With a capacity of 3,500 tonnes — seven times the capacity of the old line at its peak — the new electrified line will mainly be used for transporting goods to Africa’s second-most populous nation. Ethiopia’s economy is growing fast, with almost 90 percent of its imports going through Djibouti. Djibouti, the smallest country in the Horn of Africa, is embarking on large infrastructure projects, building six new ports and two airports in the hope of becoming the commercial hub of East Africa. Another new line linking Djibouti and the Northern Ethiopian town of Mekele is also planned, and that’s...

Sharm el Sheikh (Egypt) (AFP) – Senior African officials negotiating a trade deal in Egypt to create a common market across half the continent said Monday the pact was ready to be signed. The Tripartite Free Trade Area (TFTA) spanning 26 countries is to be launched at a summit of heads of state and government on Wednesday in the Red Sea resort town of Sharm el-Sheikh. The pact aims to set up a common framework for tariff preferences that would ease the movement of goods across the area’s member countries. The deal between the East African Community, Southern African Development Community and the Common Market for Eastern and Southern Africa would create a market with a population of 625 million and gross domestic product of more than $1 trillion (900 billion euros). “The deal is complete and ready to be signed by heads of state on Wednesday,” Peter Kiguta, the director general of the East African Community, told AFP. Trade ministers and officials gathered in the resort town from Sunday had worked out final concerns, including the management of disputes and protection for small manufacturers, he said. “All issues have been sorted out. Some technicalities remain but the overall agreement is now complete,” Kiguta said. Egypt’s Industry and Trade Minister Mounir Fakhri Abdel Nour said the agreement would be a “monumental step” for the continent. “It will bring together a united Africa,” he told delegates. “On top of that it will promote production and add value to our resources.” The...

Senior officials in Africa are poised to sign a milestone trade deal to create a common market that will span 26 countries across the eastern half of the continent — from Egypt in the north, to South Africa in the south, via Kenya. Heads of state will sign the Tripartite Free Trade Area (TFTA) pact on Wednesday in the Egyptian seaside resort of Sharm el-Sheikh, bringing five years of negotiations to a close. Once the agreement has been signed, the deal will still need to be ratified by the parliaments of each of the signatory states — a mere formality, according to Egypt's industry and trade minister Mounir Fakhry Abdel Nour, who described the final step as "simpler compared to the effort that has gone into preparing the document." Jean-Joseph Boillot, an advisor to the business club of international economics CEPII, said the deal is "a big step" for Africa. Speaking to VICE News Tuesday, Boillot explained that "the deal could potentially reconcile the 60s dream of a Pan-African nation with the financial interests of companies with an eye on the African market." The market today is "Balkanized," he said and customs barriers and trade restrictions actively discourage intra-African trade. The deal would convert three African trade blocs — the East African Community (EAC), the Southern African Development Community (SADC), and the Common Market for Eastern and Southern Africa (COMESA) — into a single customs union by 2017. The area covered by the agreement includes a population of 625 million...

The East Africa Legislative Assembly (EALA) has passed two crucial bills to facilitate free trade among East African Community member states. The bills will, however, have to be approved by the EAC heads of state before they can become law. Once they become law, the two pieces of legislation will compel partner states to eliminate barriers that have hindered smooth trade in the region. One of the laws, Elimination of Non-Tariff Barriers Bill 2015, seeks to establish a mechanism for identifying and monitoring the removal of non-trade barriers within partner states. Its passage comes against the backdrop of a surge in trade disputes arising from administrative measures deemed to be harmful to free trade in the region. The other proposed law, East Africa Community (EAC) Co-operative Societies Bill 2014, gives guidelines on the formation of co-operative societies as well as rights and duties of members. It also sets out rules on dispute settlement and dissolution of societies. The bill is based on the understanding that each partner state will encourage the efficient use of resources and promote the development of private sector organisations such as associations and agricultural outfits. This was revealed when Eala members visited Kiambu Governor William Kabogo at the county headquarters en route to Limuru for a one-day seminar at Thayu Hotel. Assembly chairman Kenya chapter Sauli Nkanae said the two proposed laws were expected to help promote fair trade among EAC member states. “We were at Brookside Dairy Limited yesterday where the officials told us that...

The East African Community (EAC) and the World Bank today hosted a convention to assess the challenges and opportunities in improving connectivity along key trading corridors to facilitate regional integration in East Africa. The Integrated Corridor Development convention, held at the UNESCO headquarters, brought together representatives from major bilateral and multi-lateral donor organizations, to discuss solutions to facilitate the funding of corridor development in land-locked countries, such as Burundi, Rwanda and Uganda. “In East Africa, high transport costs, poor infrastructure and underdeveloped logistics services limit the competitiveness and inhibit the integration of both the landlocked and transit countries into the regional and global market. Increasing the integration between the different modes of transport through development corridors can significantly improve connectivity and contribute to higher growth in the region,” said Pierre Guislain, senior director for the World Bank’s Transport and ICT Global Practice. The event comes as a follow up to the third EAC Heads of State retreat on infrastructure development and financing, held in Kenya in November 2014, where EAC leaders endorsed a strategy and action plan to improve the quality of service, and reduce the costs of transport, through developing better links between the different modes of transport along the key trading corridors of the region. The strategy, which the EAC Secretariat was tasked to implement, focuses on improving intermodality for freight transport along the Northern and Central Corridors, from the maritime ports to the inland lakes of Victoria and Tanganyika. "The EAC views the implementation of the Intermodal...