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 and "we are closely working together." The new system is considered to be another valuable tool to help mitigate the disruption of domestic, regional and global supply chain...

Commencement of trade under the African Continental Free Trade Agreement (AfCFTA) has been pushed to a tentative date in January next year. The African Union Commission’s original date of July 1 is considered untenable due to the Covid-19 pandemic. AfCFTA’s Secretary General Wamkele Mene said African governments are currently focusing on the fight against the pandemic, saving lives and livelihoods. Mr Mene said the market at the moment is not conducive for the launch considering more than 42 countries out of 55 countries in the continent are in lockdown and the containment measures are complicating intra-trade as observed in borders where trucks queuing for more than 50 km waiting to deliver essential goods. WIDE CONSULTATION Addressing private sector players in a webinar organised by Africa CEO’s Forum on Thursday, Mr Mene said the decision to push the date forward was made after wide consultation. “Suspension of the implementation of AfCFTA from July 1 was not my decision but that of African Union Heads of States. I advised the assembly on the reality, facts, science and data on the ground on the situation of Covid-19. The decision of the new date, which also depends on how quick the pandemic is contained, was widely consulted and involved the private sector,” said Mr Mene. The secretary general, appointed by the AU in March to oversee the implementation of the agreement also said the postponement was as the result of the pending negotiations which were halted by the pandemic.   “The Covid-19 crisis was...

The UK government announced on Tuesday it was merging its Foreign Office and development aid offices, in a new strategy it says will help strengthen London’s influence abroad. Prime Minister Boris Johnson told the House of Commons the UK was now facing an increasingly “competitive world” and needed to make changes in government structure to suit the times. It means the Department of Foreign and International Development, which pumps about £100 million (about Ksh13.3 billion) a year into Kenya, will be dissolved in September. “We have a responsibility to ask whether our current arrangements, dating back to 1997, still maximise British influence,” PM Johnson said. Created in 1997, the Department of Foreign and International Development (DFID) had been a separate organ of the UK government charged with managing foreign aid abroad. In Kenya, it spent £98 million last year on hunger safety net programme, regional economic development for trade and investment, as well as other programmes on security, governance and humanitarian work.   Mr Johnson said the department, while successful, having been formed after the Cold War era, was now facing competition as other countries manage aid as a foreign policy issue. The UK foreign policy has traditionally been managed under the Foreign and Commonwealth Office, which was created in 1968 after the merger of Foreign and Commonwealth departments. “This is exactly the moment when we must mobilise every one of our national assets, including our aid budget and expertise, to safeguard British interests and values overseas,” Mr Johnson said...

A summary of key negotiation points in the proposed bilateral deal between the United States and Kenya has shown that Washington is seeking unfettered access to a host of key sectors in East Africa’s largest economy. The document, published by the Office of the U.S. Trade Representative and reported by The EastAfrican, details a list of demands and rules that the American government will table when negotiations commence sometime next month. Kenya is expected to reduce or lift tariffs on all American agricultural and digital products, and also open its maritime, textile, telecommunications, financial services, and pharmaceuticals industries, including other sectors deemed sensitive to U.S. investors. The proposed free trade agreement is meant to replace the expiring AGOA deal, a trade preference program set up in 2000 that provides duty-free entry into the U.S. for almost all African products, from oil and agricultural goods to textiles, farm, and handicrafts. The Donald Trump administration has said it will not renew the multi-party deal that has been at the centre of U.S.-African engagement on trade and investment for two decades, opting instead for bilateral ones with individual countries under an “America First” policy meant to counter Chinese influence across the world. Kenya expects to benefit from the two-party deal by exporting a range of tax-free goods to the U.S. and is preparing proposals ahead of negotiations, reports show. But its decision to seek a trade deal with America outside existing regional and continental trade protocols has been met with widespread criticism and even challenged in...

In August 2018, Somaliland President Musa Bihi appointed me to come and head the Liaison office in Nairobi. My previous mission was in the United Arab Emirates where I played a similar role as head of the embassy in Dubai. In Nairobi, part of my mission is to work towards strengthening the ties between Kenya and Somaliland which have been cordial since the pre-independence days when we were both under the British colonial rule. During the period I have served in Nairobi, I have come to appreciate the good working relationship the Kenya government and my country has despite the obvious stumbling block occasioned by the fact that Somaliland remains virtually unrecognized internationally. From culture, education, trade and social issues, Kenya and Somaliland are joined on the hip making the two countries able to work with each other and supplement the other. On paper, Kenya, just like many other states do not recognize Somaliland, but beyond the political radar, Kenyans accept and appreciate the existence of Somaliland as an independent state. The fact that we have a liaison office in Kenya that acts as a link between the two countries is testimony enough that Kenya recognises the existence of Somaliland. It is for this reason, I have engaged in vigorous shuttle diplomacy within the Kenyan government not only to acquaint myself with my hosts but also to implore on the Kenyan government on the growing need to open a liaison office in our capital city, Hargeisa. I have met the...

The Port of Mombasa risks losing business to neighbouring Port of Dar es Salaam, after Tanzania moved to cushion traders from high demurrage costs importers have warned. Tanzania Shipping Agencies Corporation (TASAC) has directed all shipping agents to extend demurrage free period for transit goods, effective June 10. Demurrage is a charge payable to the owner of a chartered ship on failure to load or discharge the ship within the agreed time. According to TASAC, the Covid-19 pandemic has affected cargo clearance and timely access to cargo and related documents, which has increased turnaround time to neighbouring countries. Director General Emmanuel Ndomba has directed that importers of cargo destined for Rwanda, through the Tanzania-Rwanda border of Rusumo, be given 55 days to return empties from 30 days. Importers of DR Congo bound cargo through Rusumo have 80 days to return empties from 55 days while those using Tunduma border have 65 days, an increase from 55 days. Zambia cargo has 50 days from 40 days for containers to return. All East African Community states enjoy more days through Dar compared to Mombasa. “Extended free period shall apply to containers which were issued with delivery order starting from March 15, 2020,” Ndomba says in the directive seen by the Star. Shipping agents have also been directed to halt, with immediate effect, the use of storing order on receiving or returning empty containers in order to improve the availability of equipment and trucks. They are also required to receive all containers which...

The trend of declining foreign direct investment (FDI) to Africa is set to exacerbate significantly in 2020 amid the dual shock of the coronavirus pandemic and low prices of commodities, especially oil. FDI flows to the continent are forecast to contract between 25% and 40% based on gross domestic product (GDP) growth projections as well as a range of investment specific factors, according to UNCTAD’s World Investment Report 2020. “Although all industries are set to be affected, several services industries including aviation, hospitality, tourism and leisure are hit hard, a trend likely to persist for some time in the future,” said UNCTAD’s director of investment and enterprise, James Zhan. Manufacturing industries intensive in global value chains are also strongly affected, a sign of concern for efforts to promote economic diversification and industrialization in Africa. Overall, there is a strong downward trend in the first quarter of 2020 for announced greenfield investment projects, although the value of projects (-58%) has dropped more severely than their number (-23%). Similarly, as of April 2020, the number of cross-border merger and acquisition (M&A) projects targeting Africa had declined 72% from the monthly average of 2019. Hope for recovery However, two distinct factors offer hope for the recovery of investment flows to the continent in the medium to long run. The first is the higher value being assigned to ties to the continent by major global economies, promoting investment in infrastructure, resources, but also industrial development. Investments from these countries, which have varying degrees of political...

The East African Business Council has lauded the President of the United Republic of Tanzania, H.E. John Pombe Joseph Magufuli and the President of the Republic of Kenya, H.E. Uhuru Kenyatta, for their directives on ensuring free movement of goods across borders between Kenya and Tanzania, which will facilitate increased trade between the two countries. In a statement, EABC therefore urges the Ministers Responsible for Transport, Health and EAC to convene and find a win-win lasting solution to the barriers hindering the free movement of cargo across EAC borders and in particular, the borders between the two countries. “The fourteen (14) days standstill on the movement of goods between Kenya and Tanzania borders risks business continuity and affects intra-EAC trade. There are over 1000 trucks stranded at both sides of the border, this is significantly affecting the intra-EAC trade and movement of essential and perishable goods across borders.” The statement read in part. The council also noted that there is also a  slowdown in movement of cargo across all EAC borders, this is disrupting regional value chains due to the emerging challenges restricting the movement of truck drivers in a bid to contain the spread of COVID-19. According to the International Trade Centre, In 2018, Kenya imported products valued approx. USD. 175.9 million from Tanzania and exports approx. USD.293.5 million while Rwanda imported products approx. USD. 134.5million and approx. 2 million from Tanzania. EAC Partner States are relying on sourcing final products, intermediate input and raw materials within the region due to the disruption...

The government’s intervention to jump-start the economy falls short by Sh170 billion, audit firm Ernst & Young has said. Experts at the firm are of the opinion that some of the intervention measures might not be enough to jumpstart Kenya’s battered economy, even as the government prepares to spend Sh2.79 trillion in the next financial year starting July 1. This includes the Economic Stimulus Programme and the Credit Guarantee Scheme announced by National Treasury CS Ukur Yatani last Thursday. Yatani has availed Sh225.7 billion including Sh172 billion in forgone taxes and Sh53.7 billion direct funding to cushion sectors of the economy. This translates to about two per cent of GDP, which experts feel is half what the country needs. Economic and tax experts at the audit firm say although the government has responded by providing support both in foregone taxes as well as direct liquidity injection, more needs to be done to revive  the economy. They recommend at least Sh393.7billion or four per cent of GDP if the interventions are to make an impact on the economy’s revival, saying more needs to be done. “At least four per cent of GDP is required to jumpstart a battered economy like ours. On the basis of this, the government intervention falls short by about Sh170 billion,” Christopher Kirathe, a tax partner at the audit firm said. In addition to implementing the Economic Stimulus Programme, the government is formulating a Post-Covid-19 Economic Recovery Strategy to mitigate the adverse impacts on the economy, and...

Kenya Ports Authority (KPA) plans to construct an administration block and create more facilities at the Inland Container Depot as usage of the facility picks up. “Plans are underway to construct a proper administration block that will house the one-stop centre and provide office accommodation for cargo interveners, expand the yard to create more capacity and also construct a trucks holding yard,” the authority said in a statement yesterday. According to KPA, business is steadily picking up at the newly opened facility. This is despite a recent backlash by Uganda, which opposed mandatory clearance of transit cargo at the facility, saying its use should be optional. Yesterday, KPA said all the government agencies are on the ground to offer services to ensure smooth cargo off-take. Apart from KPA, which runs the country’s ports, Kenya Revenue Authority (KRA), Kenya Bureau of Standards (KEBS) and Kenya Railways Corporation have also set camp in Naivasha. Uganda, Rwanda , Burundi and South Sudan revenue authorities are also present to collect revenue for cargo destined to their countries. “The Naivasha Inland Container Depot has a total ground slots capacity of 5000 TEUs and has adequate equipment including Reach Stackers and Terminal Tractors,” KPA acting managing director Rashid Salim said. Currently the ICD receives one full container train of 108 TEUs per week from Mombasa for the transit market. It is envisaged that the facility will be receiving two trains per day at its peak. KPA yesterday said transit countries are now taking advantage of the...