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...

The African Union is looking to the Continental Free Trade Area (CFTA) to solve transportation problems and infrastructure issues, according to Nadir Fath Elalim from the African Union’s senior political office. Elalim told Daily News Egypt that one of the African Union’s projects is called “Free Space”, which includes three African airlines connecting the continent and will be achieved in 2022. “We are trying to address these issues together, and we’re going to reform other kinds of transportation, infrastructure and moving of goods,” Elalim added. “By implementing these kinds of projects, we show we have the plan. We have already outlined the Alexandria-Cape Town Road and the road from Alexandria to Sudan, Ethiopia and Djibouti.” In addition to this, a railway has been planned between Zambia and Angola , and one from Dakar to Djibouti as well, Elalim said, highlighting that the infrastructure programme is on the agenda . “It is not true that we don’t have transportation, but we don’t have a proper infrastructure to enable exports to move to other countries,” he confirmed. The African Union has been working on Agenda 2063 since 2013, outlining where Africa will be in the next 50 years. The agenda is broken down into 10-year plans, with the first 10-year plan, the Continental Free Trade Area (CFTA), to be launched in 2017. African countries are working in harmony with trade blocs, including ECCAS and ECOWAS, alongside COMESA, SADAK and the East African Community (EAC). Elalim added that all member states of the...

When Kenya, Uganda and Rwanda began the implementation of some of the projects under the East African Community (EAC), without the other partner states; Tanzania and Burundi, critics were already predicting doom for the bloc. The reasons forwarded by the leaders then was that time was of essence if the projects were to get off the ground. Those who were ready could proceed, the others could follow later. They were applying the variable geometry principle. Today, that wisdom is already paying off, especially as regards to the Northern Corridor projects that were being held back by lack of action or sense of urgency. That is why the leaders of the three countries decided to take personal supervision: they would meet every three months to access progress and give guidance. The summit that was held in Uganda this week went even further by setting up a special body that would exclusively fast track all projects. That is called acumen. If the projects were not getting the full attention of busy government officials, the only option was to go back on the drawing board and rearrange the pieces. That is called foresight. We cannot afford the luxury of falling behind on our schedules; we have the necessary manpower, so there is no need to dilly dally when crucial decisions have to be made. Source: All Africa

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. He said trade ministers and officials who had gathered in the resort town from Sunday had worked out final concerns, which had included the management of trade disputes and protection for small manufacturers. "All issues have been sorted out. Some technicalities remain but the overall agreement is now complete," Kiguta said. Egypt's Minister of Industry and Trade Mounir Fakhri Abdel Nour told delegates Monday that the agreement would be a "monumental step" for the continent. "It will bring together a united Africa," he said. "On top of that it will promote production and add value to our...

The East African Community ( EAC) plans to open 15 one-stop border posts to reduce the time taken to clear goods and services. Alfred Kitolo, a director with the State Department of East African Affairs in the Ministry of East African Affairs, Commerce and Tourism, said this would reduce the time spent at the border by 30 to 40 per cent. Mr Kitolo said agencies from adjoining states would be housed in one building to promote trade and investment within the EAC. He was speaking during a three-day capacity building forum on operational procedures of one-stop border posts at the Lunga Lunga border post yesterday. Participants included officials from Kenya Revenue Authority (KRA), security departments, national and county governments, Kenya Bureau of Standards, the Kenya Trade Network Agency, the Kenya Plant Health Inspectorate Service, the Kenya Wildlife Service and business community representatives. Kitolo said the Lunga Lunga one-stop border post would be handed over to the facility management and trade facilitation committee in September once it was completed. IMPROVE FLOW Kwale County Executive for Trade and Co-operatives, Safina Tsungu, commended the EAC member states for building one-stop border posts, saying it would deepen the EAC integration process and improve the free flow of goods and services across common boundaries. James Kivuva, senior assistant director in the State Department of East African Affairs, said parties agreed that respective officials should jointly conduct physical inspection and searches under the Kenya-Tanzania-Bilateral Agreement. Among the border posts under construction are Kabanga/Kobero at the Tanzania-Rwanda...

Any assumptions that East Africa was short of money to finance a number of its key projects were put to rest during a dinner for three presidents attending the Northern Corridor infrastructure summit on Friday night, with private sector players saying the region needed to offer a conducive environment for more capital to roll in. Making a strong case for the banking industry's ability to fund investment projects, Patrick Mweheire, the chief executive at Stanbic bank Uganda, the largest in the country in terms of assets, said: "The irony is that capital is no longer a scarce resource anymore." He explained that some of the top private equity funds were "looking for yield in the region," meaning that foreign players were willing to spend money on investments that could bring them higher interest earnings. Private equity funds usually channel money through financial institutions such as banks. A report by Ernst and Young, released last year, notes that East Africa will continue to attract private equity funds for the years ahead. "As growth rates declined across most of the developed world in the aftermath of the credit crunch, private equity (PE) firms turned to emerging markets as an engine of growth," the report, titled Private Equity Roundup Africa, noted. It further noted that "East Africa (consisting of Kenya, Tanzania, Uganda, Rwanda and Burundi) will be attractive partly because it is doing more than most other African regions to become integrated, thereby facilitating easier cross-border activity and attracting investors." The report pointed...

The Kenya Revenue Authority has proposed amendments to some laws to help it fight smuggling through the port of Mombasa. The authority cited failure to police Kenya’s borders, which have become increasingly porous, as enabling the entry of illegal goods, including wildlife trophies. The Parliamentary committee of Environment and Natural Resources visited the port on Thursday to establish why it has become a transit point for illegal goods. The deputy commissioner of Customs, Nicholas Kinoti, said there is a need to amend the laws that have allowed illegal trade to flourish. “For instance, an export manifest is valid for 30 days and we are asking parliament to amend the law and reduce it to 14 days. This will ensure that cargo does not stay for too long at the port before it is exported,” he said. On April 20, four tonnes of ivory was seized at Bangkok’s main port in a container shipped from Mombasa port, but originating from the Democratic Republic of Congo, destined for Laos. And on April 25, 511 pieces of ivory, weighing over three tonnes and worth $6 million, were found in Bangkok, Thailand, in a container marked as “tea leaves” transported from Mombasa and also destined for Laos. The East African Tea Trade Association had entered into an agreement with KRA in which tea containers were not subjected to scanning due to the high volumes exported daily. Instead, they were loaded under the supervision of Customs officers, a loophole that ivory traders are said to...

Infrastructure development is the key highlight in this year’s national budgets for East African Community partner states. A big chunk of the governments’ money has been allocated to construction of roads, railways, an oil pipeline, harmonisation of axle load controls and service automation at border points. Most of the countries’ outlays are expected to support ongoing infrastructure development in roads, standard gauge railway, ports, energy and security. A part of this development budget will be funded by project loans and grants from development partners, while the balance will be financed from domestic resources. However, as per the budgets, the African Development Bank, the World Bank and the European Union are financing most infrastructure projects with a regional dimension. The East African countries have been negotiating with the development partners as well as individual countries, particularly China and India, in efforts to raise the required resources. The regional infrastructure projects are expected to cost at least $100 billion in the 2015/2016 financial year. Uganda has a budgetary allocation of Ush101 billion ($32.5 million) for power projects; Ush35 billion ($11.3 million) for the acquisition of land for construction of the oil refinery and Ush4.5 billion ($1.45 million) for the Kampala-Kigali standard gauge railway line. Uganda will also invest heavily in scaling up oil and gas exploration and production, build petroleum infrastructure and the related pipelines for distribution, operations and management, development of an oil refinery and the development and implementation of a communications strategy for the oil and gas industry in the...