Traders from the East African Community (EAC), the Common Market for Eastern and Southern Africa (COMESA) and South African Development Community (SADC) may soon trade freely across borders if their heads of states sign a tripartite agreement next week. Speaking on the sidelines of the Trade Mark East Africa stakeholder forum at Serena Conference Centre, trade minister Amelia Kyambadde said all contentious issues have been ironed out and that heads of state of the three regional blocs will, on June 10, sign the Free Trade Area agreement. “The contentious issues included dispute settlement and rules of origin, which is partially done,” he said. If signed, it will pave way for the creation of a larger market to boost intra-regional trade and reduce the cost of doing business. The signing had been postponed twice. It had been planned for December last year but was pushed to mid-February 2015, as SADC reportedly requested for a postponement to allow for further internal consultations. It was again deferred from February to June. Some trade analysts are sceptical whether Uganda will reap meaningful benefits from a larger market yet it has failed to fully exploit the EAC market. “The agreement will open us to bigger economies like South Africa; the question is can we handle yet we still have challenges with Kenya under the EAC and Egypt under COMESA,” a source who asked not to be named for fear of being labelled a saboteur, said. The source added that Uganda will become a supermarket for...

New laws are creating greater liquidity and capital in some African markets and giving African private equity investors more opportunities — especially in pension funds — says Carolyn Campbell, managing director at Emerging Capital Partners, according to a report in InternationalFinancialLawReview. Emerging Capital Partners is a pan-African private equity firm focused on investing across Africa. Changing regulations governing the investment of African pension funds have momentous potential for private equity in certain countries including Kenya, Nigeria, Namibia and South Africa, Campbell said. All four countries recently made changes to asset allocation rules for state pension funds, allowing for investment of up to 15 percent in some cases of pension assets into private companies. “As a result, we are seeing African investors increasingly investing in African private equity,” Campbell told the LawReview. As pension fund regulators and administrators become more familiar with the benefits of private equity, this will present an opportunity to increase the level of capital available to the private sector, Campbell told the LawReview. “This local support should also build the confidence of international investors to invest further in African private equity.” Outside South Africa, most African pension cash continues to shun private equity opportunities on the continent, FinancialTimes reported in October. Insiders say African pension funds have missed out. It’s not because the continent is failing to save for its future – sub-Saharan pension funds total more than $350 billion US — but because of a nightmare combination of regulatory hurdles, poor incentives and hesitant trustees, FT...

West Africa will miss all the potential and opportunities inherent in it by virtue of its location and capacity, if it does nothing to push its integration agenda beyond the free movement of goods, people and capital. Even though regional blocs such as the Common Market for Eastern and Southern Africa (COMESA), the East Africa Community (EAC) and the Southern Africa Development Community (SADC) were motivated by efforts of West Africans, those sub-regional bodies had since moved into new frontiers where they were really reaping the benefits. “These are people who should be learning from the Economic Community of West Africa States (ECOWAS), but they are so far ahead of us,” a Nigerian travel business consultant and travel promoter, Mr Iketsi Uko admits and said it was time for the private sector in West Africa to lead the way, having demonstrated that it could collaborate to achieve quicker results. ECOWAS’ latent potential The West Africa region has a population of 300 million, the same as the United States of America and bigger than the European Union (EU). The sub-region has 40 airports dotted across but the region has not been able to harness the benefits of integration. “The region is, therefore, well positioned to be one of the biggest economies in the world and immediately compete with China, which is already taking the world by storm, if we are able to work together,” Mr Uko, also a media consultant, journalist and author, said. The sad thing, however, is that although...

South Africa and the other BRICS nations need jobs, growth and greater competitiveness. Europe needs jobs, growth and greater competitiveness. The US needs much the same. Better trading terms are a key way to secure these goals for businesses and consumers. They can act too through a multiplier effect in a complex set of value chains and SME supply systems. The World Trade Organization (WTO) plays a key role in the adjudication of multilateral trade agreements and their implementation and enforcement, but has been left playing a less dynamic role in recent years – with the failure so far of the Doha Round – in the negotiation of major multilateral deals. It secured the Bali trade facilitation deal recently with helpful customs progress, but even that was a somewhat tortuous process. Bilateral, plurilateral and issue-specific deals are therefore filling the negotiations void left by the WTO. These are aimed at driving progress and helping to prevent any nascent protectionism. The EU and US have both concluded deals with Korea. And the EU with Canada and with Singapore and, on goods for example, with the East Africa Community (EAC). The EU has embarked on a major bilateral programme including with the US (TTIP – a potentially landmark agreement, is going beyond tariffs into the depth of regulatory coherence and convergence), Japan, some ASEAN and Latin American nations, and potentially India. It has also started an investment agreement dialogue with China, and is now looking to overhaul its free trade deal with...

This month, African countries will finalise a 26-nation free trade bloc aimed at opening up business on the continent by 2017, a senior South African minister told Reuters on Wednesday. Trade barriers across the continent has curtailed its growth prospects by driving up the cost of doing business. Lifting charges like export and import fees could promote new markets and boost profits. "We want to remove many of the barriers that stifle economic growth in Africa," Minister in the Presidency Jeff Radebe said on the sidelines of the World Economic Forum Africa in Cape Town. The agreement between finance ministers from the Common Market for East and Southern Africa, the Southern African Development Community and the East African Community will be finalised in Cairo next Wednesday, he said, adding South Africa was "optimistic" it would be in place by 2017. The government said last month official negotiations would be launched in June to eventually establish a continental free trade area embracing the entire continent of 54 countries, opening up a market of 1.3 billion people with a combined GDP of more than $2 trillion. Source: Times Live

ENTEBBE, UGANDA - East African community countries have been urged to come up with policies that support small farmers to participate effectively in the Agriculture sector where they contribute about 60%. Uganda’s Minister in charge of East African Community Affairs Shem Bageine in his speech read by the Commissioner of production and Social services in the Ministry of East African Affairs Ronah Sserwada during the East African Community Agriculture Budget Summit held at Entebbe said that it’s the responsibilities of the Governments in the community to guarantee the thrives of Agriculture sector in the Five member states of EAC. “Member states should create a conducive, policy, Legal and program frame work that supports the growth and expansion of Agriculture sector where the major stake holders are small farmers who need much support from their Governments” the minister said. The Minister noted that the Agriculture sector contributes much in the regional Economies but because of the lack of pro - small farmer’s policies the sectors contribution in the regional Gross Domestic products is declining For stance the Minister said that the Contribution of Agriculture sector in the Economy of Burundi has decline by 34%, Kenya 29% Rwanda 32% Tanzania 25% and Uganda at 23%. Bagaine in his speech told participants majority being small farmers from all over the Five member states that East African Community has established Regional Integration protocols Where member states committed themselves to co-operate to attain Food security and rational agriculture production through the community by promoting complementarity...

Two senior IMF officials, writing in their personal capacities, recently offered some insight into what the East African Community (EAC) will be up against in the run-up to having a Monetary Union. It will not be easy. The Union is scheduled to come into effect in 2024 when, hopefully, EAC member states will be using a common currency. However one basic point that Paulo Drummond and Oral Williams made very clear, is the need to have the building blocks firmly in place. In this way, the sequencing of reforms, all tied to achieving economic convergence, will be much easier. Not surprisingly, due to the relative success of the European Union euro single currency, the EAC is also following the same path. Although not all the EU members are part of the euro pact, it is fortunate for the EAC to have a living example of what to expect. From the time a decision was made to have a single currency to minting the first coin, took the Europeans 18 years. The EAC wants to do it in less time, specifically over 10 years. Events in Burundi have put a damper on things. Regional stability is essential for any chance of a successful transition period. Consequently, this crisis has to be resolved as quickly as possible. According to Drummond and Williams, as cross-border activities increase, national central banks will need to adopt a consolidated approach to banking supervision in order to avoid difficulties in a bank’s operations in one country spilling...

SOUTH Africa and the other Brics (Brazil, Russia, India, China) nations need jobs, growth and greater competitiveness. Europe needs jobs, growth and greater competitiveness. The USA needs much the same. Better trading terms are a key way to secure these goals for businesses and for consumers. They can act too through a multiplier effect in a complex set of value chains and SME (small and medium enterprises) supply systems. The World Trade Organisation (WTO) plays a key role in the adjudication of multilateral trade agreements and their implementation and enforcement, but has been left playing a less dynamic role in recent years – with the failure so far of the Doha Round – in the negotiation of major multilateral deals. It secured the Bali trade facilitation deal recently with helpful customs progress but even that was a somewhat tortuous process. Bilateral, plurilateral and issue-specific deals are therefore filling the negotiations void left by the WTO. These are aimed at driving progress and at helping prevent any nascent protectionism. The EU and US have both concluded deals with Korea. And the EU with Canada and with Singapore and, on goods for example, with the East Africa Community (EAC). The EU has embarked on a major bilateral programme including with the US (TTIP – a potentially landmark agreement in going beyond tariffs into the depth of regulatory coherence and convergence), with Japan, with some Asean and Latin American nations, and potentially with India. It has also started an investment agreement dialogue with...

KABANDA CHULU, Lusaka PLANS to launch the grand free trade area (FTA) that will bring 26 countries in the tripartite regional economic blocs into one common market have advanced. Heads of states and governments are expected to append their signatures on the FTA on June 10, 2015, in Egypt, according to the COMESA website. The Common Market for Eastern and Southern Africa (COMESA), Southern African Development Community (SADC), and East African Community (EAC), Tripartite FTA (TFTA), comprising 26 countries or 48 percent of the membership of the African Union holds 51 percent of its gross domestic product and 56 percent of its population will be the largest economic bloc in Africa. This will also be the launching pad for the establishment of the continental free trade (CFTA) in 2017. "The advance teams will start arriving at the venue from June 5 for the technical meetings that will prepare the ground for the launch. The tripartite committee of senior officials and the council of ministers will be part of the advance team and their pre-launch meetings will take place on June 7and 8." “They will prepare the launch documents including the TFTA agreement, the declaration launching Phase II of the negotiations for the TFTA and the roadmap,” it stated. The decision to establish the COMESA-EAC-SADC TFTA was mooted in 2008 to overcome the challenges posed by the overlapping membership of the three regional economic blocs, especially in the regional trade. Zambia has dual membership in COMESA and SADC. Source: Zambia Daily...

The South African Development Community (SADC) in yellow, the Common Market for Eastern and Southern Africa (COMESA) in different shades of green and the East African Community (EAC) in the light brown (the only country in the EAC that isn’t also a member of COMESA is Tanzania). That map is from 2009 so doesn’t include South Sudan. In a recent note, Capital Economics named Africa as one of the world’s few potential bright spots as far as boosting global trade is concerned: Over a longer time horizon, sub-Saharan Africa could also play a much larger role in world trade… If sub-Saharan Africa can sustain the pace of GDP growth seen over the past ten years, its share of the world economy could more than double over this time. While this would not be as dramatic as China’s rise over the past 35 years, it does still imply that Africa’s share of world trade will rise substantially from where it is today. Given the development levels and divergence of the countries involved, progress is likely to be slow — but the Tripartite Free Trade Area would be a big step in the right direction. The world is just about to get a free trade area that’s bigger, by population, than either the European Union or NAFTA. It’s got nothing to do with the much-publicised Trans-Pacific Partnership (TPP) Transatlantic Trade and Investment Partnership (TTIP). In fact, you’ve probably never heard of it. It’s actually the Tripartite Free Trade Area, a deal that...