Cross-border trade across East Africa could be set for growth following the enactment of an innovative new law that aims to aid resolution of trade disputes caused by non-tariff barriers (NTBs). The East African Community (EAC) Elimination of Non-Tariff Barriers (NTBs) Act, 2015 will remove obstacles to intra-EAC trade as it provides for the first time, an alternative to the lengthy and costly court processes required to settle NTBs related disputes. While the core objective of the EAC Common Market is for easier intra-regional trade, NTBs have hindered trade and limited the region’s ability to benefit from greater integration. The impressive growth of intra-EAC trade, the best among Africa’s trade blocs, could have been even better if issues like import bans, product quotas, complex and discriminatory rules of origin, unjustified sanitary and phytosanitary conditions, export subsidies, inadequate infrastructure, ‘buy national’ policies, corruption and lengthy customs procedures were addressed in a quicker and legally binding manner. The NTBs Act has been passed by the EAC Legislative Assembly and is now awaiting assent by the Heads of State and ratification by the national parliaments of each of the partner states to become operational. The Act will work by establishing a framework for resolution of NTBs in the EAC, introduce alternative dispute resolution mechanisms and involve the EAC Council of Ministers as a last resort without the need to go to national courts. Maciel is director, Trade Facilitation at TradeMark Africa Source: Media Max

Vision: TOWARDS A SINGLE MARKET Theme: Deepening COMESA-EAC-SADC Integration 1. The Heads of State and Government of the Common Market for Eastern and Southern Africa (COMESA), East African Community (EAC) and Southern African Development Community (SADC) Tripartite met on 10 June, 2015 in Sharm El Sheikh, Egypt and: (a) LAUNCHED the COMESA-EAC-SADC Tripartite Free Trade Area (Tripartite FTA); Related Topics Business Malawi: MPs' Anger At Tax On SMS, Per-Gigabyte Internet Zimbabwe: Govt Lifts Chrome Ore Export Ban Nigeria: JAIZ Bank Breaks Even, Records N158 Million First Profit Nigeria: RMAFC to Slash Political Office-Holders' Pay East Africa Sudan: UN Warns of Worsening Situation in Darfur Kenya: Insecurity, Poverty Blamed for Education Crisis in Lamu Kenya: Principal Who Stripped Girl Out On Bail Kenya: What Erykah Badu Was Up to in Kenya North Africa Zimbabwe: Africa's Largest Economic Bloc Launched Zimbabwe: President Back From Egypt East Africa: Leaders Agree on Cape-to-Cairo Free Trade Zone - the Historic Text North Africa: All in the Same Boat - the Challenges of Mixed Migration Southern Africa South Africa: 'Technicality' Frees Alleged Child Abductor Zimbabwe: Zim Translocates Five Black Rhinos to Botswana Zimbabwe: Zanu-PF Headed for a Landslide Zimbabwe: Amos Midzi Died of Poisoning - Autopsy (b) RECOGNISED that the Tripartite FTA represents an integrated market of 26 countries with a combined population of 632 million people which is 57% of Africa's population; and with a total Gross Domestic Product (GDP) of USD$ 1.3 Trillion (2014) contributes 58% of Africa's GDP; (c) FURTHER RECOGNISED that the...

On June 10th, the coalition of three regional economic communities (RECs), representing 26 African countries, 58% of the continent’s GDP, and a population of more than 600 million come together under the Tripartite Free Trade Area. Once signed into existence, the TFTP will represent more people than NAFTA or the European Union. The TFTA’s aim is to promote development through increased economic integration of North, East, and South Africa; the project is part of a larger “regional integration strategy that places high priority on infrastructure development, industrialization, and free movement of business persons.” As it currently stands, Africa is the least economically integrated region in the world, as measured by intra-regional trade flows. Trade between African countries, as a share of the continent’s total trade has hovered at 10% for decades; the proportion in Europe and Asia, by contrast, is close to 60%. African countries’ tendencies to trade more with non-African countries has had serious ramifications for continental integration and for continental economic development. Trade theory going all the way back to David Ricardo in the 18th century suggests that when two countries trade with one another, they focus their production efforts on the sorts of good that they have ‘comparative advantage’ in making. Current trade patterns in Africa promote specialization in primary commodities and agricultural goods; some suggest that increased trade within Africa could allow for a diversification of production profiles through the cultivation of other comparative advantages. The creation of a regional body tasked with promoting economic integration...

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...