In Summary The commodity traded at $1.81 (Sh193.85) last week. The tea sector is grappling with oversupply owing to prolonged rainfalls in tea growing areas in the country. Tea prices this week fell to the lowest mark this year at the Mombasa auction, as demand for the commodity recorded mixed performances in the export markets. A kilo averaged $1.73 (Sh185.28), down from $1.81 (Sh193.85 ) last week, amid an increase in volumes traded at the weekly auction. The volumes traded went up to above 10 million kilos compared to 9.7 million kilos last week. “The total volume traded for Sale 27 was 318,729 Kilos more than Sale 26,” the East African Tea Trade Association (EATTA) says in its weekly report. Out of 192,080 packages (12,649,027.50 kilos) available for sale, 151,741 packages (10,011,700 kgs) were sold. 21 per cent packages remained unsold, EATTA notes. Kazakhstan, other CIS nations, Sudan, Afghanistan and Bazaar showed more interest. Yemen, other Middle Eastern Countries and Egyptian Packers were active but at lower levels while UK and Russia were selective. “There was reduced activity from Pakistan Packers with some selective interest from Iran. Local Packers were active in line with price. Somalia were active at the lower end of the market,” EATTA Managing Director Edward Mudibo said. This is a new low mark this year. The commodity had traded at $1.78 (Sh190.64 ) for three consecutive weeks, which was the lowest this year, before picking to Sh193 last week. The highest price remains in the first week of January when the auction opened with an average...

In summary New import tax changes for the current fiscal year are effective July 1. The decisions to stay application of the EAC CET rate and apply a higher duty rate are aimed at stimulating local production and safeguarding markets against cheap imports. The import duty measures in the EAC Gazette issued on June 30 can be put into three main categories which are Duty Remission for Industrial Inputs, Stays of Application, and Amendments of the East African Community Customs Management Act, 2004. The duty remission measures adopted by the EAC Partner States will ensure that local manufacturers can import raw materials and inputs which are not available in the region at a lower rate. Kenya could ramp up its growth plan for the year after East African Community (EAC) member-States sanctioned new taxation measures aimed at protecting local industries from unfair competition. The economy has been on a strict diet of austerity measures that curbed spending and lowered taxes in the wake of the coronavirus pandemic. Gloom has brought with it pay cuts and job losses and as a result local industries have been hit hard. But the new move by the bloc seeks to offer a lasting redemption package to the struggling industries after new import tax changes on the bloc’s Common External Tariff (CET) were announced last week and will take effect on July 1 following a ratification agreement signed during the pre-budget consultations by member State’s representatives. Ministers from EAC held Pre-Budget Consultations prior to reading of...

Cross-border travel after COVID must be safe and predictable and shouldn’t require excess disclosure of personal health information. Developing such crossing experiences will take cooperation between the health sector as well as aviation, travel and tourism sector stakeholders. Timing is of the essence to prevent further harm to economies and make travelers comfortable with travel. When the six nations of the East African Community opened to essential trade in June, COVID-19 testing created kilometers of backed up trucks along the borders as truck drivers waited for hours to get test results. By working together to share test results in a harmonized system, border crossing and regional integration was later accelerated within East Africa. We need this kind of coordination and harmonization on a global scale. Unfortunately, that is not the current trajectory of COVID-19 era border crossing. COVID brought a patchwork of closed borders and complex border entry requirements as reopening countries attempted to balance the urgent need to restart travel and cross-border economic activity against the imperative of protecting their population’s health. Such disparate efforts are slowing travel and halting a range of industries such as tourism. Without intervention, these efforts will lead to fragmented policies and procedures and make international travel confusing and uncertain long into the future. Image: IATA The need: Safe, dynamic borders that respect private data For cross-border traffic to resume fully, travelers need border crossing experiences that are safe, predictable and do not require excess disclosure of personal health information. Such policies are not universally in place....

In Summary •60% of cargo attracting storage charges as a result of delays clearing processes. •Delays blamed on reduced operating capacity by government agencies and restrictions to access the facility in wake of Covid-19. Importers and clearing agents are worried delays in cargo clearance at the Inland Container Depot-Nairobi are increasing the cost of doing business even as Covid-19 continues to negatively impact trade. Only 40 per cent of cargo is cleared within the four-days free storage period, the Shippers Council of Eastern Africa (SCEA) has said. The remaining 60 per cent incur storage charges of between $30 (Sh 3,213) and $90 (Sh9,639) per day, per container, adding to the cost of import and last-mile transportation. According to a survey by the shippers council, ICD Nairobi performance in import logistics efficiency deteriorated between January and May. This was as a result of reduced operations by most senior personnel of Kenya Ports Authority(KPA), Kenya Revenue Authority(KRA), and other government agencies, who are partly operating from home and office. This has affected decision making, SCEA notes in its report. There is also a reduced number of middle and junior officers to process cargo with partly the same customs cargo clearance framework and partly online process. “Customs clearance of cargo requires physical interaction either for verification or release hence certain customs functions could not be performed with remote control,” SCEA chief executive Gilbert Langat notes. Clearing agents are also not allowed to access offices of KPA, KRA, and other government agencies to solve...

The Kenya Revenue Authority is embroiled in a legal battle with vendors of electronic cargo tracking systems, who have sued the taxman to block its control of the system meant to tame tax evasion. A petition filed on behalf of the vendors by activist Okiya Omtatah wants the court to stop the authority from taking over management of cargo tracking services, which they have been running since 2006. The taxman has accused vendors of colluding with cargo owners to dump goods in the local market. The petition 113 of 2020 before the High Court in Nairobi is the second in the battle to keep the tracking of transit cargo business in the private firms after a similar one in 2017 was dismissed by the same court, with KRA now accusing the vendors of sneaking an appeal on the earlier petition they had lost. “The honourable court be pleased to issue an interim order suspending the Kenya Revenue Authority implementation of the KRA Regional Electronic Cargo Tracking system (RECTS) through the public notice issued on March 13 and the free use of the customs Electronic Cargo Tracking Seals acquired from BSmart technology Limited,” reads the petition in part. The vendors argue that the procurement of the system KRA is using in partnership with other East African revenue collection agencies was not competitively bided for and that the shift to the new system will ruin their businesses. The latest battle in court now prolongs KRA’s long journey to control transit cargo monitoring...

The currency in the state is very weak and slowly the county’s shipping sector is monopolized. When we talk about African countries, harsh economic conditions have a strong impact on currency and economic situation in countries. If we add Covid-19 to this - then everything gets more difficult. If we talk about Kenya, the country which has experienced a lot of problems this topic is really important. The currency in the state is very weak and slowly the county’s shipping sector is monopolized. The country has a very strong connection with China. But there are some details. China may gain control over the assets of the Kenya Port Authority KPA, including the port of Mombasa if the Kenyan state railway corporation KRC does not fulfill its debt obligations to the Export-Import Bank of China SGR. According to dozens of financial companies, chief among them Axiory and its analytics experts, KPA's assets are at risk, as the administration has committed to loading China’s Mombasa-Nairobi standard gauge (SGR) rail. China provided loans for the construction of SGR in the amount of about 500 billion Kenyan shillings (about five billion US dollars). The construction of the second phase of the SGR was officially completed in October 2016. Commercial freight operations began in early 2018. Losses of SGR for the first year of operation amounted to 10 billion shillings. Payments on loans should begin in the middle of next year after a five-year grace period. The port of Mombasa is the largest transport hub serving the foreign trade...

A report by United Nations Conference on Trade and Development said despite steps taken to develop the country into a regional e-commerce hub, the digitalization of government services is advancing and the government is investing resources into enhancing the overall business environment. “Despite this, Tanzania has yet to adopt a stand-alone e-commerce policy or strategy and e-commerce is not mainstreamed into the national or sectoral trade development strategies. E-commerce development is not currently on the agenda of existing inter-ministerial or public-private dialogue platforms,” the Tanzania’s Rapid eTrade Readiness Assessment report said. The report further noted that with a large and growing population, a competitive mobile network operators (MNOs) market and increasing mobile service delivery, the trajectory of growth of mobile Internet users is positive. “Building the National ICT Broadband Backbone (NICTBB), connected to the region’s main submarine cables, has resulted in lower mobile data prices for end-users. By the end of 2018, 3G and 4G networks covered around 61 per cent and 28 per cent of Tanzania’s population, respectively. This remains considerably lower than the 2G coverage of around 90 per cent,” the report noted. The UNCTAD report stated that although mobile data prices are reasonably low, they remain unaffordable for segments of the population that mostly reside in rural areas which has resulted in a large gap in Internet use between urban and rural areas. “Also, fewer women than men access and use the Internet. Given that most Tanzanians access the Internet through their mobile phones, the low Internet...

Efforts to speed up cargo movement in the region received a major boost Tuesday after the European Union signed a deal with the Trademark East Africa (TMA) to fund safe clearance at the ports and border points. Under the Sh602 million (€5 million) emergency trade programme, mobile testing labs will be provided at Mombasa port and key border crossings, including Busia and Malaba. The programme to be rolled out under public-private partnership will also provide personal protective equipment to port and border point workers to cushion them from Covid-19 spreading at these trade hubs. “This (fund) grant is very important and will complement the government’s efforts that ultimately cushion not only large enterprises but especially also the MSME who rely greatly on the flow of supply chains as most cannot maintain large inventories,” said Trade Secretary Betty Maina. The funds from the European Union will fund the Kenyan component of the programme, making the bloc the largest donor to the programme. “I am, therefore, happy to support this Safe Trade Emergency Facility in Kenya not only as a donor but also by drawing on the EU’s knowledge and experience. This action will support Kenya as the gateway to the EAC by making certain that all supply chains stay open,” said EU Ambassador to Kenya Simon Mordue. Source: Business Daily

From the safety of my lockdown office at home in Johannesburg, I’ve just “returned” from the first ever UK virtual visit to Kenya. Thanks to telecoms companies such as the UK’s Vodafone, which have enhanced capacity and networks in Kenya and across Africa since the start of lockdown, I was able to meet virtually with business, government entirely using digital platforms. My visit came at a catalytic time for Kenya. The Covid-19 pandemic has had a dramatic impact on the global economy. While we are still working together to respond to this, we must also turn our attention to how we recover, rebuilding better. We have a clear moment now to choose a greener, more inclusive and sustainable future. Technology isn’t just enabling us to recreate how we used to work, or what we used to work on. During my visit, I spoke to a number of female entrepreneurs, who are working with the UK-Kenya Tech Hub and are adapting to the extraordinary challenges the pandemic has created, all the time with unremitting trademark resilience and energy. It was also encouraging to hear that, even in these difficult times, innovation remains strong, as does the breadth and depth of the UK-Kenya relationship. This is framed by the Strategic Partnership that UK Prime Minister Boris Johnson and President Uhuru Kenyatta signed in London at the UK-Africa Investment Summit in January, where we also announced Sh170 billion of new UK investments in Kenya. Heartening too was learning about how larger companies—including Kenya’s...

The pilot phase of a regional Covid-19 surveillance system for trucks and their crew starts today, Monday, June 15, before its full implementation next week, an official has told The New Times. Towards the end of last month, East African Community partner states adopted the Regional Electronic Cargo and Drivers Tracking System that will be hosted at the EAC Headquarters in Arusha, Tanzania. This came after a consultative meeting chaired by President Paul Kagame on May 12 this year, brought together four East African Community (EAC) leaders and discussed regional efforts to tackle the COVID-19 that has ravaged the world. At the time, the leaders directed concerned regional ministers to "finalise and adopt an EAC digital surveillance and tracking system for drivers and crew on COVID-19 for immediate use by partner states." "Today (Monday) we are doing piloting and next week all goes live," Eng. Daniel Murenzi, the Principal Information Technology Officer at the EAC Headquarters in Arusha, Tanzania, said. "The system delayed to be implemented immediately after the Ministers had approved the system to be used; this was because we had to first do direct integration to the national laboratories." According to Murenzi, last week, a technical test was "done successfully." "And now we are starting piloting this week since we have agreed with transporters. Also, we have finished purchasing equipment through support of Trademark EastAfrica that will be used for screening: these are tablets that will be having an application on." Murenzi noted that each country has assigned a national focal person...