TANZANIA has high potential to become the economic powerhouse in the East African region given her natural wealth and strategic geographical positioning, but there are challenges to overcome before it can realise its potential. This is the observation of the TradeMark Africa, Chief Executive Officer, Frank Matsaert whose organisation is assisting East African Community (EAC) member states, Tanzania, Kenya, Uganda, Rwanda and Burundi to promote trade and integration. He told the ‘Business Standard’ in Dar es Salaam last week that huge growth potential in land, water bodies, minerals, as well as the strategic positioning of the country were enough to make the country a leading economic giant in the region. Mr Matsaert said TradeMark Africa was keen to help Tanzania utilise her great potentials to become the leading economic powerhouse in East African region. “Tanzania has the great potential of becoming the economic powerhouse of the region given her natural endowments and geographical positioning. We are keen to know what can we contribute to make that happen,” he said in an interview on the sidelines of national stakeholders forum to review key results of TMA country programme. TMA’s second country programme is expected to begin in 2017 after the expiry of the current programme, whose main highlights include the 593 million US dollar modernisation project of the Dar es Salaam port it partnered with the World Bank and the British Department of International Development (DfID). The Dar es Salaam port is the gateway to the Central Transport Corridor that has...

DAR ES SALAAM, May 26 (Xinhua) -- Tanzania will begin building a port and mega mining projects before the end of this year, with funding from China, the minister of industry and trade has said, as the East African nation is stepping up its industrialization. The 2.7 billion U.S. dollars Mchuchuma coal mining and Liganga iron ore mining projects, funded by China's Sichuan Hongda Corporation Ltd., will be "the largest industrial investment project to be registered in Tanzania since the country attained independence in 1961", Abdallah Kigoda said on Tuesday. "Everything has been completed. We are only waiting for the arrival of construction equipment and machinery," the minister told parliament in Dodoma. The Mchuchuma project is estimated to bear 540 million tons of coal deposits, which will be able to produce 600 megawatts (MW) of electricity for a period of over 100 years. Kigoda said that, of the electricity, 250MW will be used for the Liganga iron ore mining project while the remaining 350MW will be injected into the national grid. He added that a total of 32,000 people will be employed at the two projects. The Sichuan Hongda group has established a firm named Tanzania China International Mineral Resources Ltd., in partnership with Tanzania's National Development Corporation Ltd., according to the minister. Another grand project that is to start this year, is the construction of a port and a special economic zone in the coastal town of Bagamoyo, said Kigoda. He said the 11 billion U.S. dollars port project...

"Egypt seeks increasing the volume of its exports to the African Free Trade Zone (AFTZ) to $5 billion in the next three years, compared to $2.7 billion in 2013," said Egypt’s Industry’s Minister. AFTZ includes the three biggest trade blocs: Southern African Development Community (SADC), the Common Market for Eastern and Southern Africa (COMESA) and the East African Community (EAC). “Egypt’s imports from SADC markets reach $7 billion annually, while the exports do not exceed $42 million,” said Egyptian Minister of Industry Mounir Fakhry Abdel Nour in press statements after a meeting with Federation of Egyptian Industries (FEI) Tuesday. The free trade agreement between the three biggest trade blocs is expected to be signed during a conference in Sharm el-Sheikh to be held in June. It will launch a free trade zone between the 26 member states of the blocs. FEI President Mohamed Zaki El-Swedy said that the federation has presented proposals on increasing Egyptian exports to African markets to the Cabinet. The Most prominent proposal was the products’ exchange between Egypt and Africa to ensure foreign currency. Egypt has acquired 25 percent of intra-regional trade exports in the Common Market for Eastern and Southern Africa (COMESA). It also ranks fourth among the major importers in the COMESA region, African Development Bank (ADB) representative Laila Mokaddem said in March, 2014. Source: The Cairo post

The three African economic blocs, made up of COMESA, SADC and the East African Community, will be integrated into one free market, Minister of Industry and Trade Mounir Fakhri Abdel Nour announced in a closed meeting on Tuesday. In the meeting, to prepare for the African Conference of the three blocs, Abdel Nour added that African countries ‘ economies are growing at a high rate. The minister noted that Egyptian exports to Africa in 2013 accounted for $4.5bn of total Egyptian exports, which amounted to approximately $23bn. Abdel Nour discussed with the Federation of Egyptian Industries (FEI) how to activate the three African blocs through export promotion movement between Egypt and other African countries, according to FEI Chairman Mohammed Al-Suwaidi. During a press conference, Al-Suwaidi confirmed that during the summit, which will be held in Sharm El-Sheikh from 7 to 10 June, an agreement gathering all the three blocs in one agreement will be signed, entitled the “Sharm El-Sheikh agreement”. “This summit stems from our belief in the importance and the role of Africa, as it is the largest growing and promising market for Egyptian exports,” Al-Suwaidi added. “The reactivation of trade and exports movement between Egypt and Africa will solve a number of problems related to hard currency and high costs of shipping through the activation of the role of trade exchange stated in the COMESA agreement.” Al-Suwaidi declared that the FEI will send an invitation to the African Development Bank (AFDB) to visit Egypt to take advantage of...

EAST Africa still has some of the highest freight and transport costs which erodes the global competitiveness for the region's exports, a trade consultant said on Friday. Trade Mark East Africa director general David Stanton said the high costs slow down trade, hold back hold back economic growth, job creation and poverty eradication. He spoke in Mombasa when TMA and the UK's Department of International Development signed a £23 milliom (Sh3.5 billion) financial support deal for a green programme at the Mombasa port. The national government and Trade Mark East Africa had hosted international donors at a conference intended to highlight priority infrastructural requirements at the port of Mombasa in need of renewal and upgrading. “This project aims at minimising environmental impacts while addressing energy efficiencies which are among many projects that TMA is spearheading through the UK government support at the Mombasa Port to enhance trade environment in the region,” said Stanton. Stanton said the programme aims at ensuring availability of fresh water, protection of marine environment, better use of energy and reducing carbon emission from ships and cargo trucks. He said the additional support is in response to a recent study conducted by the Kenya Ports Authority recommending the need for mainstreaming of climate change and renewable energy into port operations. Through TMA he said that UK and its seven other development partners are currently spending about US$700m (Sh51 billion) on reducing barriers to trade and accelerating regional economic integration in the East African Community. “Improvements at the...

The Tanzanian port of Dar es Salaam was once the most efficient in sub-Saharan Africa. The performance of the port, which is the second-largest in east Africa, has slipped dramatically over the past 20 years. Ships are often forced to wait to dock and the transit of goods through the port is slow. The World Bank estimates that trade costs are 60 per cent higher between Tanzania and China than between Brazil and China, despite the distance between the Latin American country and the world’s second-biggest economy being almost double. The port is also unable to accommodate larger vessels, which is becoming increasingly problematic. “Container ships have become bigger. For economies of scale, shipping companies prefer three large ships docking than 10 smaller ones,” says Smak Kaombwe, an adviser for TradeMark Africa. “You need ports to become bigger because of that. Otherwise you can find your port becoming irrelevant.” Dar es Salaam port’s constraints are a problem for Tanzania because demand for imports is set to rise dramatically as the population, currently about 51 million people, continues to grow. Its population will double every 25 years if the current rate of growth continues. Tanzania also wants to increase its exports significantly. The country currently imports more than it exports, a trend that the government wants to reverse. “The plan is to become a net exporter,” says Mr Kaombwe. Any plans to boost Tanzania’s trade must focus on Dar es Salaam as about 90 per cent of the country’s international trade...

Policymakers and professionals will Tuesday meet at a consultative forum in Kigali to review the state of matters in regard to regulation of professional services committed by Rwanda under the EAC Common Market Protocol. The meeting will look into challenges encountered in the process, as well as assess the rate of cross-border practice by Rwandan professionals. According to the Ministry of East African Community Affairs (MINEAC), the forum will also assess the effect of non-recognition of academic and professional qualifications granted by EAC partner states, which deters cross-border practice. Denis Karera, vice president of East African Business Council, told The New Times that the forum is timely as Rwandan professionals need to self-evaluate and see how to best push further into the open EAC market. "We need to evaluate ourselves as professionals and know where we are in the regional market. Are we fitting in it, compared to other regional professionals? We shall then be able to consider where we need to upgrade," Karera said. Professional services committed by Rwanda under the protocol comprise medical, legal, accounting, auditing, book keeping and taxation, education, veterinary services; in addition to construction, architectural, quantity surveyors, urban planners, and engineers' services. Karera added: "We have been crawling so the forum is a test for us. It's not too late." The Private Sector Federation (PSF) director of advocacy, trade and labour relations, Antoine Manzi Rutayisire, said there are many challenges encountered, especially in Tanzania. Everything revolves around the principle of mutual recognition of professionals in...

At the point where River Sio meets Lake Victoria is a small trading centre whose growth has not been very impressive over the years. The locals tend to ignore its retarded growth and insist on calling the shopping centre a town. But a town it should be. It has all the natural ingredients of not only being a town but a major tourist hub and a mover of the economy of the Western region and the country at large. Just a 100 metres from the ‘town’ is what should be a world-class port. A bridge that was the late Mzee Jomo Kenyatta’s government’s ambitious project of connecting Kenya and Uganda lies unfinished. No, its construction is about to start, at the lake’s mouth, some 40 years down the line. Here, young men, and sometimes women, dive into the world’s second largest fresh water lake for a swim. Sometimes, it is the only bath these lads get for the day. Development has been long in coming for Sio Port. But it is coming. Residents cannot help but believe there is a very bright light at the end of the tunnel for their ‘town’. Investors too, seem convinced that the otherwise blind tourists, both local and foreign, are about to open their eyes and see the beauty that the place exudes, the sandy beach, the flora, the birds, the meandering river, and the species of fish that can only be found at Emagogwe — ebidonge, esire, echachu, eningu and others whose English...

Volatility of the local currency stems from the global financial crisis, worsened by the shilling’s turmoil domestically in 2011, insecurity and closing down of several forex bureaus. Recovery lies in avoiding excessive turbulence and minimising the negative impacts on investor opportunities and risks, write Dr Mbui Wagacha (top) and Dr Eric Aligula (bottom) Three key factors determine a country’s exchange rate:the relative purchasing power of its currency; its investment opportunities and risks; and its demand for goods and services. Against this background there is reason to ponder the recent depreciation of the Kenyan shilling. This year, it has shed approximately 5.1 per cent of its value against the US dollar, compared with annual declines of 4.8 per cent, 0.27 per cent, 1.1 per cent, 5.29 per cent, and 6.48 per cent for 2014, 2013, 2012, 2011 and 2010, respectively. The current global exchange rate scene is rooted in the financial turbulence of 2007/2008, the management of the ensuing economic contractions (deflation), and the impacts of policy choices made in major economies to fight the great recession. The US chose its policies wisely. It implemented expansionary but “unconventional” central banking policies combined with an expansionary fiscal stimulus to address financial stability and stimulate the economy by restoring private spending. The policy mix cut interest rates to historic lows but caused capital “spillovers” abroad, especially in the so-called “carry trade”. The policy mix worked to reverse a plunging economy. It yielded a strong recovery and created or saved millions of jobs. The...

A contracting manufacturing does not bode well for the economy and according to the latest economic survey 2015, this is what happened to the industrial sector last year. Growth in the sector was down by 2.2 per cent from 2014. This growth was supported by animal feeds, tobacco products, pharmaceutical products, furniture, fabricated metals and other non metallic mineral products while the shut down of the refinery took its toll on us. For a long time now the country has been running on one engine only, that of domestic consumption. Our biggest export market is the EAC and total trade increased in 2014 which is an improvement. Our exports to the EAC in 2014 recovered somewhat from the drop that was witnessed in 2013 to a total 162,456,423 though not in equal measure to 2012 when we had exports totalling to 165,803,523. A two-year moving average analysis of exports to EAC partner states shows that our exports to Burundi have consistently increased over a period of5 years, while our exports to Tanzania, Rwanda and Uganda have been decreasing. We are increasingly importing from Uganda which is now our biggest import market in the region. A positive blip in all this data is that the sector as a whole delivered on its promise to create more jobs. Formal employment increased by 2.9 per cent creating 8,000 new jobs, informal employment created 112,200 new jobs, compensation to employees was up by 11.2 per cent and our imports of industrial machinery increased pointing...