The misleading reporting that has recently appeared in the press regarding Qalaa Holdings and its investment in Rift Valley Railways (RVR) has compelled us to respond to the blatant inaccuracies and to clarify any misunderstanding that may have occurred as a result of these false accusations. We clearly and unequivocally state that Qalaa Holdings is committed to adhering to the highest international business standards and to ensuring the success of the project in question. Furthermore, the company has repeatedly demonstrated that it is a staunch advocate of investing in the region as a whole. Qalaa Holdings was, therefore, deeply dismayed by the story that was reported online by Finance Uncovered and published on June 22nd in The Observer. Since 2011, Qalaa Holdings has proudly overseen the renaissance of a strategic infrastructure asset in East Africa which was previously in a state of disrepair. For the past five years, despite significant challenges, Qalaa Holdings has supported RVR's management and its local partners to implement a comprehensive and complex turnaround program. By assembling and leading a consortium of experienced infrastructure financiers, including the IFC, AfDB, KfW, FMO and BIO, Qalaa Holdings has enabled RVR to achieve the following:- 1. Reduce incidents (calculated by million train kilometers) by 40%; 2. Increase its haulage capacity through the acquisition of 20 locomotives and up to 240 high-capacity wagons; 3. Reduce transit time between Mombasa and Kampala (one way) by 29.8%; 4. Introduce the most advanced train operating technologies; 5. Pay $66 million in concession fees...

African countries should unite and form their own common market to bolster preferential trade required to drive economic growth and development, an official has said. African Union Commission chairperson Nkosazana Dlamini-Zuma said this while officially opening the 32nd Ordinary Session of the AU Permanent Representatives Committee (PRC) in Kigali, Rwanda on Sunday.Dr Dhlamini-Zuma said opening up of markets, liberalization of economies and facilitating free movement of people across the continent were key elements in driving Africa’s economic growth and development. To further Africa’s economic growth and development agenda, the AU is pursuing various initiatives including creating a Continental Free Trade Area (CFTA) to boost intra-African trade. Another initiative is the launch of the AU Passport, a flagship project of Africa’s Agenda 2063 aimed at facilitating free movement of persons, goods and services around the continent -in order to foster intra-Africa trade, integration and socio-economic development. “The world is moving towards mega trading blocks, that all exclude us, and the Doha development round of negotiations have failed to even start. Unless we unite to form our African common market, the little bit of preferential trade we have at the moment, will be further eroded,” said Dhlaminin-Zuma. “If we continue building momentum on the continental free movement of people and on the Continental Free Trade Area it will create better conditions for our traders, farmers, business, entrepreneurs and innovators to invest trade with each other and build Pan African companies and brand.” The PRC meeting kicked off the mid-term African Union summit which...

Minister of Trade, Industry and Cooperatives has urged the Ugandan business community that has been conducting business in South Sudan to explore other market in region. While addressing journalists at the Uganda Media Center yesterday, Amelia Kyambadde said that the South Sudan market has a highly lucrative business destination; traders need to think twice for their sake of their lives when going there because of the risks. Fresh fighting erupted four days ago in the capital Juba between loyalists of President Salva Kiir and Riek Machar, the vice president. The two were to lead under a deal to end a two-year civil war that had started towards the end of 2013. Kyambadde said South Sudan became Uganda’s leading export destination in 2008 following the signing of the comprehensive Peace Agreement in 2005 with the total exports both formal and informal peaking at US$1.18b (sh3.9 trillion) in 2008 However, due to the fighting that broke out in December 2013, sparking off a civil war in the world’s youngest nation, there was a steady decline in Uganda’s exports from US$414m (sh1.3 trillion) in 2013 to US$385m (sh1.2 trillion) in 2014 and US$353m (sh1.1 trillion) in 2015. Uganda’s leading exports to South Sudan, according to Kyambadde, are cereals, milling products, sugar, iron, cement, steel, and soft drinks, among others. “Government advises the Ugandan business community to explore other markets that were created through regional integration especially in the East African Community and the Common Market for East and Sothern Africa (COMESA) in the...

A record 147 per cent growth in April exports has restored Uganda as a top market for Kenya’s industrial merchandise, official statistics show. Provisional data produced by the Kenya National Bureau of Statistics (KNBS) indicates that monthly exports to Uganda grew by a record Sh11.43 billion in the month of April, translating to four-month performance of Sh23.5 billion. The national statistics agency has also revised February export figures to Uganda, from Sh21.9 million that it has been reporting up to last month to Sh3.51 billion. The upward revision also affects February exports to Tanzania which have been adjusted from Sh115.37 million reported last month to Sh2.08 billion. The January to April cumulative export to Uganda represents a 34 growth compared to the same period last year and overtakes Netherlands which topped the list in the first quarter of the year. Kenya’s exports to Netherlands dropped 27 per cent in the month of April, translating to a four-month performance of Sh15.37 billion. Last month, the KNBS caused uproar when it reported a 35 per cent drop in exports to Uganda in the first quarter of the year, ending the landlocked state’s dominance as Kenya’s top market for industrial merchandise. The latest data suggest that the UK may well be on its way to finish the year at its traditional position as Kenya’s second largest market for exports. READ: Uganda loses top slot as buyer of Kenya's exports on 35pc fall The UK which has just voted to pull itself out of...

Summary Israeli Prime Minister Benjamin Netanyahu began his four-country trip to East Africa in Uganda on July 4 before heading to Kenya, Rwanda and Ethiopia. It was the first visit by a sitting Israeli prime minister to the region since 1987. In a bid to bolster Israeli-East African ties, the prime minister held talks with his counterparts on increasing cooperation on security and economic matters. Official comments professing mutual dependence aside, the trip is unlikely to yield huge benefits given Israel's relatively small size. Analysis Israel's ambitions in East Africa are modest, with trade remaining low as a result: Israeli exports to all of Africa in 2015 amounted to $1 billion, or just 2 percent of its total exports. Business ties are informal, in most cases offshoots of direct personal relationships. For example, Ugandan officials, including longtime President Yoweri Museveni, made frequent trips to Israel in recent years. During these visits, friendships were forged with powerful Israeli figures, including former Mossad official Rafi Eitan, who is an advocate for more Israeli investment in Uganda. Yet despite these signs of warm relations, neither country has a diplomatic mission in the other. Symbolically, though, Netanyahu's first destination, Uganda, holds great emotional resonance for Israelis — and, most notably, for the prime minister himself. His visit coincided with the 40th anniversary of the famous Entebbe raid, when Israeli Sayeret Matkal commandos freed 103 hostages held by Palestinian and Red Army Faction terrorists at the Entebbe International Airport. Lt. Col. Yonatan Netanyahu, commander of Sayeret Matkal,...

By Zephania Ubwani Arusha — East African Community (EAC) officials say they are shocked by renewed fighting in South Sudan which until yesterday had claimed hundreds of lives. "We don't know exactly what is happening in Juba and not aware of what's going on," remarked an official of the Secretariat when reached for comment. Nevertheless, he said, the deteriorating security in the country which was recently admitted into the bloc was a setback to the EAC and efforts underway to integrate it into the community. He hinted that senior executives at the Arusha-based secretariat are likely to consult today in order to assess the situation which has raised deep concerns across the entire bloc and possibly issue a statement. "What's happening in South Sudan is not good at all and we hope both sides will lay down arms," he said on condition of anonymity, noting he was encouraged by the televised overtures made by President Salva Kiir and his Vice President Riek Machar on the weekend to end the clashes. He added that renewed fighting had come at a time when EAC was contemplating to send its team of officials to assess the level of readiness of the strife-torn country to integrate with EAC after its admission into EAC on March 2 and signing of an Accession Protocol by President Kiir in Dar es Salaam in April. A business consultant based in Arusha, Mr Simon Mapolu, said the current deadly clashes in South Sudan were enough reflection of the deep...

By Lydia Shekighenda Several scholars and economists have backed the government's move to drop the Economic Agreement Partnership (EPA), saying it is in line with its priority of creating an industrialised economy. Interviewed by the 'Sunday News' separately in Dar es Salaam yesterday, they said that the move will not only protect domestic industries but also the revenue earned by the government through importation of goods from European Union (EU) countries. "If Tanzania will decide to sign the protocol, it would mean allowing the importation of duty free and quota free goods from the EU - thus imposing stiff competition with domestic manufacturers," one of them, Mzumbe University's Professor Honest Ngowi said. He noted that industries within the EU were well protected; meaning that importation of goods from the countries will make local manufacturers fail to compete in the market. Prof Ngowi further explained that the government has been getting revenue from goods imported from the EU, which also means that it stands to lose the earnings if it will endorse the protocol. "This is a right move for the protection of domestic industries and government revenue," Prof Ngowi stressed. He, however, noted that Tanzania, as an East African Community (EAC) member state, agreed to sign the protocol as a bloc. Therefore, its decision to drop the agreement may be received in a different way by other partner states, which might consider it as a slow moving or unwilling partner. He observed that in the long run, the government should...

Next week the African Union (AU) will issue the first e-passports to allow holders to travel visa-free between its 54 member-states. At first, the heads of state, foreign ministers and permanent representatives of member-states, will be the main passport holders. The ultimate aim of the AU is to gradually issue these passports to all Africans. This would be even more ambitious than the Schengen Area established by the European Union. The free movement of labour and goods is a key goal in the 2063 agenda, the AU’s 50 year action plan, to further continental integration. Much of Africa’s trade is still with European and Asian powers, particularly China, rather than between African countries. But there are regional trends towards free movement. Visa-free travel is already permitted between Ghana and the Economic Community of West African States (ECOWAS), which includes Nigeria. While the East African Community (EAC) is planning to establish its own regional passport in 2017. Critics have raised concerns of the spread of infectious diseases, as well as terrorist networks and smuggling, across borders. With just six member-states, the EAC is the most advanced union in Africa and may well try to establish a monetary union in coming years. The Financial Times provides an overview of African integration. Source: The World

Kenya, Uganda, Tanzania and Rwanda are losing about $2 billion in revenue every year to foreign investors through generous tax incentives. Tax Justice Network-Africa (TJN-A) and ActionAid International figures show Kenya loses $1.1 billion, Tanzania $790 million, Uganda 370 million and Rwanda $176 million in unnecessary tax holidays, capital gains tax allowances and royalty exemptions. On its part, Burundi lost $52 million to firms or officials who were given tax exemptions to import goods to build infrastructure and instead sold the materials. TJN-A and ActionAid said policymakers in the region have spoken about revising tax policies but questions abound on how these tax incentives will be revised, costed and phased out, and the government’s resources and expertise to carry out the exercise. The report by TJN-A and ActionAid titled “Still racing towards the bottom? Corporate tax incentives in East Africa,” reveals tax incentives are fuelling competition for investors and derailing harmonisation of policies, thereby undermining integration. “Though there have been improvements in recent years in addressing the issue, governments continue to give away domestic resources in tax incentives,” said ActionAid Tanzania’s country director Yaekob Metena. The report said the real cost of incentives remains hidden in all five EAC countries as there are neither mechanisms nor demands for accountability to reveal the huge revenue losses happening. Mr Metena said there is a need for a shift in policy as political, financial national and institutional authorities admit tax incentives harmful to revenue mobilisation need to be revised if not altogether eliminated....

After a year of uncertainty since protests against President Pierre Nkurunziza's decision to run for a third term in office began, the East African Community has now declared Burundi safe to host its activities. The EAC suspended its activities in Bujumbura in the run-up to the June 2015 elections at the height of protests by activists who insisted that Nkurunziza's candidacy violated the Constitution, even though the country's highest court had cleared him to run for the presidency. Last week, an EAC security mission comprising representatives from the other four partner states was in Burundi for four days to assess the situation. The team released a report showing that they were satisfied that the security in Burundi "is satisfactory for continuation of activities with minimal risk to staff and delegates." The mission comprised the assistant director in Tanzania's Ministry of Foreign Affairs and EAC, Aman Mwatonoka, Uganda's director of strategic intelligence at the military headquarters, Lt-Col David Lumumba, advisor on EAC Affairs in Burundi's Ministry of Public Security, Emmanuel Niyonizigiye, and the director of political affairs in Kenya's State Department for EAC Ministry, David Njoka. According to the delegation, Burundi has returned to normalcy especially in the capital which has been a hotspot for violence that claimed more than 500 lives and led to thousands fleeing the country. Kenya's ambassador to Burundi Ken Vitisia, asked the East African countries to support the country end the political crisis. "Burundi has a lot to give back to the Community especially in the...