The European Union and six countries of the Southern African Development Community (SADC) finally signed an Economic Partnership Agreement (EPA) on Friday (10 June) after more than a decade of talks – in a move that gives Botswana, Lesotho, Mozambique, Namibia and Swaziland duty-free access to the EU. For South Africa, the sixth country in the SADC, its products will see improved preferential treatment over and above what is already covered by the existing bilateral EU-South Africa Trade and Development Cooperation Agreement into the EU market. In particular, the agreement increases the flexibility of Southern African producers to put together products from components from various countries, without the risk of losing their free access to the EU market. The EPA is a development-oriented free trade agreement that takes into account the different levels of development of each partner nation. It is the  the first of its kind between the EU and an African region pursuing economic integration. The agreement was signed by EU trade commissioner Cecilia Malmström, who said: "We want to base our trade relations with our partners in the Southern African region on commonly agreed, stable rules. Trade has helped lift millions of people from poverty throughout the years. Thanks to agreements like this one, we are preparing the ground for that process to continue." By signing the EPA, all participants commit themselves to act towards sustainable development and to uphold social and environmental standards. The agreement also establishes a consultation procedure for environmental or labour issues and defines a comprehensive list of areas...

The World Bank Board has approved a mega project meant to strengthen selected higher institutions of learning in Eastern and Southern Africa to deliver quality postgraduate education and build collaborative research capacity in priority areas. The Eastern and Southern Africa Higher Education Centres of Excellence Project (ACE II), expected to close in 2021, will see each of the 24 Africa Centres of Excellence (ACE) funded to a tune of $6 million over five years. The project is good news for the regional higher learning institutions which are grappling with poor quality education due to limited research funding. Since the project will focus on supporting collaborative research, it is a step forward in fixing quality challenges in higher institutions of learning. If well implemented, the project will significantly enhance the quality of education in the region and this will reduce on the number of people who travel out of the region in search for better education. The Uganda-based IUCEA, an East African Community (EAC) institution responsible for coordinating the development of higher education and research, is the regional facilitation unit for the ACE II project. The EAC member countries should collaborate to ensure that IUCEA benefits all the member countries within the framework of fast tracking the integration process. Education is a key component in the integration process and having quality education in all member countries will go along away in fulfilling the goals of the integration. By the time the project concludes in 2021, the centre should have developed sufficient...

WHEN the first East African Community (EAC) collapsed in 1977, some in the Kenyan government celebrated with champagne. Since its resurrection in 2000, officials are more often found toasting its success. A regional club of six countries, the EAC is now the most integrated trading bloc on the continent. Its members agreed on a customs union in 2005, and a common market in 2010. The region is richer and more peaceful as a result, argues a new paper* from the International Growth Centre, a research organisation. Many things boost trade, from growth to international deals. The researchers use some fancy modelling to pick out the effect of the EAC. They find that bilateral trade between member countries was a whopping 213% higher in 2011 than it would otherwise have been. Trade gains from other regional blocs in the continent are smaller: around 110% in the Southern African Development Community (SADC), and 80% in the Common Market for Eastern and Southern Africa (COMESA). Those numbers for the EAC are all the more impressive because the available data stop before the EAC’s common market had properly come into effect. Progress on that front has sometimes stuttered. A 2014 “scorecard” identified 51 non-tariff barriers. Full implementation could double the income gains seen so far, say the researchers. Not surprisingly, it is landlocked Rwanda which would see the biggest benefits. Tanzania, which has dragged its feet on integration, would profit the least. The researchers are warier of the EAC’s other grand project: creating a...

The East African Business Council has elected Mr Econie Nijimbere from Burundi as its new Chairman for the period of 2016-2017. The Burundian is taking over from Mr Dennis Karera, who served at that capacity from the year 2015. Mr Nijimbere was serving as a Vice Chair. According to the statement issued yesterday, the new EABC chief is currently the President of Burundi Federal Chamber of Commerce and Industry (CFCIB). He has over 16 years of experience in the private sector, from 2010 to the present. He has also served as President of the Burundi Manufacturers Association as well as Board Member of the Burundi Revenue Authority (OBR).  In his acceptance speech, during the council annual general meeting held in Nairobi, Kenya, Mr Nijimbera thanked the outgoing Chairman Mr Karera and the Executive Committee for a job well done and the progress made so far. He outlined key areas that his tenure will focus on implementation of the EABC Strategic Plan 2015/18, extensive advocacy on issues outlined in our EABC Policy Advocacy Agenda document that aims at addressing key sectoral and cross cutting trading policy challenges as well as highlighting gaps and discrepancies in the implementation of the East African Community Customs Union and Common Market Protocols which are hindering East Africans from enjoying advantages presented by East African Community Integration and the wider EAC Common Market. Source: All Africa

East African Community regional integration has not evolved as envisaged. However, it is still achievable, given that the EAC partner states have harmonised most of their policies and internal and external tariffs. As EAC governments unveil their annual budgets, it is essential for the respective proposals to boost cross-border trading, movement of goods and manpower, and address the fundamental issue of non-tariff barriers across the region. Non-tariff barriers are restrictions and limitations that are obstacles to trade. They are not tariffs but rather take different forms of government participation. These include restrictive trade practices, administrative and custom entry procedures, charges on imports, technical barriers, sanitary and phytosanitary measures, institutional corruption, tedious licensing procedures, and transport, clearing and forwarding procedures. Non-tariff barriers have positive and negative effects and present a major stumbling block to full EAC integration. They trim the magnitude of imports in a country by promoting and cushioning local manufacturers and producers against dumping of sub-standard goods in the local markets. However, they also limit the movement of goods across the region and lead to increased cost of doing business, unnecessary delays at border points, and restricted opportunities for business expansion. The EAC committee on the elimination of non-tariff barriers reported that there were 40 unresolved barriers and three new ones in 2012. In 2014, the number of unresolved barriers had increased to 56 and the new ones to five. Insufficient infrastructural services have been identified as a major barrier that increases the cost of doing business and commodity...

East African Community (EAC) member states have prioritised development expenditure as countries look to further strengthen the growth agenda of the regional economies. In the national budget estimates presented yesterday, the regional bloc’s biggest economy Kenya will be spending $22.8 billion, Tanzania $13.5 billion, and Uganda $12 billion during the next financial year that starts on July 1. Rwanda plans to spend some $2.49 billion in the fiscal year 2016/17. Burundi budget reading is not aligned with that of the EAC bloc. Kenya While presenting the budget speech, Kenya’s Finance Cabinet Secretary Henry Rotich, said the 2016/17 budget will focus on infrastructure development, agriculture, including agro-processing to spur the country’s growth, among others. The minister also abolished tea and sugar development levy. The energy sector got Ksh39.9 billion, standard gauge railway (Ksh228.5 billion) and roads got Ksh147.6 billion. Tanzania In Tanzania, Minister for Finance Phillip Mpango indicated that the new budget is focusing on alleviating challenges of people in low-income groups, and setting the foundation for middle-income country. In a country, where the national debt reportedly stands at $20.94 billion as of March, programmes geared at supporting development were allocated 40 per cent of the total budget, an increase from 25 per cent this fiscal year. Among others, the Tanzanian government intends to borrow Tsh7.4 trillion from domestic revenue to fill the gaps of the fiscal year 2016/17. The government will also spend Sh17.7 trillion on operational costs and Sh11.8 trillion for development. Over Tsh4.77 trillion or 22.1 per cent...

An increasing drive to promote domestic textile manufacturing in East Africa is threatening the trade in used clothing to the region, the Bureau of International Recycling (BIR) has been told. The warning was delivered at a session on the global trade in used clothing and textiles at the BIR’s annual Convention and Exhibition in Berlin last week (31 May – 1 June), where delegates disagreed on the status of the used clothing trade. While some  consider used clothing to be a product generated through sorting operations and recognised market specifications, others notably the East African Community (EAC), continued to regard used clothing as a waste and a threat to new clothing production. This view has given rise to calls in some parts of the world for a ban on used clothing imports. At a meeting on an EAC proposal to phase out imports of used textiles and footwear by 2019, BIR Textiles Division president, Mehdi Zerroug, of Framimex in France, said: “Second-hand clothing is a product and new clothing is a product – this needs to be understood.” EAC The EAC comprises six countries, namely: Uganda, Kenya, Tanzania, Rwanda, Burundi and South Sudan. Guest speaker Jalia Nabukalu Packwood, business development officer at Bangor University’s Sustainability Lab in the UK, explained that used textiles traders number in the many tens of thousands in places such as Uganda and Kenya. The convention heard that more than 80% of all clothing purchases in Uganda were used clothes, while Kenya collected US$ 54 million...

Both the World Bank and the International Monetary Fund urged Uganda to increase spending on public infrastructure while also ensuring more projects are delivered on time and to budget. The international lenders said yesterday that shifting public spending towards infrastructure would stimulate growth and plug a huge deficit in sectors like energy and transport especially. However, many planned investments in the country had yet to be completed, dampening their effect on economic activity and resulting in slow growth. If the government can deliver more projects on time, the returns on the public sector investment in these schemes will be higher, the institutions continued. Christina Malmberg-Calvo, World Bank country manager for Uganda, said this would improve value for money for taxpayers. “It is therefore important to invest in the country’s ability to invest by transforming the public investment programme into a system that better increases the value derived from public investment.” In its Uganda Economic Update, the bank said the investment management system should be capable of efficiently and effectively delivering critical infrastructure on schedule as well as to tap into new opportunities to finance human capital development. It called on the government to undertake more careful scrutiny of investments and to improve the evaluation of projects to help future project selection and risk identification. A combination of poor investments and a weak economic environment, further exacerbated by the crash in oil and commodity prices, have led to below par growth in Uganda. A growth rate of 4.5-5% over fiscal year...

In most of Africa, leaders have unfettered control over the state apparatus. Because of this, it is always difficult to wish away their banter as mere rhetoric, however much it is divorced from official government policy. There are two things to note here. One, President Museveni is a teetotaller whose public off- the script statements are always measured almost to a mathematical detail. In fact, his remarks at the swearing-in ceremony against the International Criminal Court (ICC), however repulsive they may be deemed, may not have been unintended. Two, Uganda and the ICC continue to enjoy a tumultuous relationship. For example, following the ICC's indictment of Joseph Kony and his lieutenants, USA deployed its special forces in the vast jungles of central Africa to bolster UPDF and other forces hunting for the elusive rebel leader. In fact, when Dominic Ongwen was captured, Uganda's objection to try him in The Hague rather than in Uganda was, at best, lukewarm. The implication of this is that Uganda, a signatory of the Rome Statute that gave birth to the ICC, recognises both the jurisdiction of ICC and its significance. It is safe to say that Mr Museveni's continued stay in power continues to rattle many global power centres. In some countries, there has been an overt demand for a peaceful power transition. These countries, led by USA, ironically do not recognise the ICC, are known to use any instruments at their disposal either to whip stubborn leaders or push for their agenda. This...

Exports to Uganda have dropped by 35 per cent in the first quarter of the year, ending the landlocked state’s dominance as top destination for Kenya’s exports. Provisional data produced by the Kenya National Bureau of Statistics indicate that exports to Uganda dropped to Sh8.58 billion in the first three months of 2016 compared to Sh13.3 billion the same quarter last year. For the first time in more than a decade, Uganda falls to fourth position after Netherlands which tops the list with Sh11.89 billion worth of goods followed by UK which ordered Sh10.79 billion and US which accounted for Sh9.06 billion. Netherlands mainly orders Kenya’s flowers which it sells via its many auctions. Like UK, it is a member of the European Union which has extended duty-and-quota-free terms to Kenya and other developing countries under economic partnership agreements. Tanzania— which has been consistent in the recent past as second top export destination after Uganda — has also been dislodged to the seventh position after recording marginal drop of Sh5.25 billion compared to Sh5.81 billion the same period last year. Kenya initially showed strong affinity to the landlocked states in East Africa but of late, Uganda and Rwanda have drifted towards Tanzania with plans to link up their economies through crude pipeline and standard gauge railway line. The figures released last week indicate that apart from Uganda and Tanzania, exports to all other top destinations grew with Pakistan and Egypt also emerging as preferred markets for Kenyan goods. Pakistan, which...