ARUSHA, Tanzania, 28 February 2015 / PRN Africa / — Ministers from the East African Community (EAC) have signed a Cooperation Agreement on Trade Facilitation, Sanitary and Phytosanitary (SPS) Measures, and Technical Barriers to Trade (TBT) with the U.S. Trade Representative, Ambassador Michael Froman on 26 February, 2015 in Washington, D.C. The Cooperation Agreement will increase trade-related capacity in the East African region, as well as deepen the economic ties between the EAC and the U.S. This partnership will build on to the EAC's work on customs reforms, which have already resulted in substantial reductions in the time and costs of moving goods across borders within the EAC Partner States. During the signing ceremony Ambassador Froman announced that the United States will look into expanding ‘Trade Africa' beyond the EAC boarders to the rest of Africa. ‘Trade Africa' is U.S. President Barack Obama's initiative to support greater U.S.-Africa trade and investment. “Today's Agreement is an important milestone for strengthening what has already proven itself to be a promising and impactful partnership,” said Ambassador Froman. “This Agreement will help us lift the burdens that trade barriers impose, unlocking opportunities for both our continents,” he said. While a majority of the region's people are involved in agricultural production or processing, the export potential of these products are currently limited. With this new Agreement in place, the EAC can now meet international standards by bringing in U.S. technological expertise to fully implement the World Trade Organization (WTO) Trade Facilitation Agreement on Sanitary and...

The East African Community (EAC) currently consists of 5 countries vis Kenya, Uganda, Rwanda, Burundi and Tanzania. Of these, only two have direct access to the sea, whilst the rest of the three are landlocked and thus fully dependent on the other two to handle bulk imports and exports. As a result of these dependencies, the EAC has established groupings and protocols like the Northern Corridor and the Central Corridor transport routes to handle and advise on logistical issues surrounding the transportation of goods mainly to the ports of Mombasa and Tanzania. The major issue addressed in these groupings is infrastructure. The EAC are currently net importers of goods and the transportation of these from the ports of Mombasa and Tanzania has been the biggest preoccupation hence the regular infrastructure summits like the one held in Kampala and Kigali recently. Because of the bulk of the exports and imports passing through Mombasa and Dar es Salaam, it is important for the road and rail network to be efficient and reliable. This has not been the case and there has been a lot of dependence on the road networks that have been problematic due to the poor condition of the roads, the problems associated with border crossings and dealings with different authorities. In order to address this, member states of the Northern Corridor; Kenya, Uganda and Rwanda and Burundi have been pushing for the establishment of a Standard Gauge Railway (SGR) project to relieve the pressure on the dilapidated and often...

KIGALI, Rwanda – The East African Community (EAC) is looking at developing a regional capital markets infrastructure which is aimed at integrating the region’s capital markets. writes AGNES BATETA. “We will not have a single East African exchange but we do believe we can have an integrated EA capital market infrastructure working with our different regulators, the market participants and our capital markets,” Secretary General EAC Richard Sezibera said during a discussion held during the EAC capital markets conference held in Kigali recently. Sezibera said, “This is an important agenda and one of the areas in which East Africa has moved fast forward and is moving increasingly in the area of harmonization and integration”. “We believe to deepen the capital markets for EAC; we need to make sure that our standards are benchmarked against international standards. We might be developing the regional standards but these must be strongly benchmarked against international standards,” Sezibera said. EAC is aimed at widening and deepening integration among the five member states which include Rwanda, Uganda, Kenya, Tanzania and Burundi. “For the widening part, EAC over the last few years has formed the Customs Union with the Single Customs Territory, it has a common market and the monetary union which was signed in 2013, and a 10-year road map that will introduce in a single currency,” Sezibera said. According to Sezibera, the deepening part of it especially in the common market and the capital markets integration agenda is based on six pillars. “EAC is engaged...

(Reuters) - The United States and five East African countries pledged on Thursday to ease trade flows and set the stage for more U.S. investment, a program that could be extended to other parts of Africa. The agreement commits Tanzania, Kenya, Uganda, Rwanda and Burundi to cooperate with the United States in customs issues, ease red tape at borders, reduce customs wait times and harmonize trade standards. As part of the deal, which has been in the works since 2013, Washington will provide training on food safety, animal and plant health standards and international regulations. "We see this agreement and all our work with (East Africa) to date as an important steppingstone, not the final destination," U.S. Trade Representative Michael Froman said. China's rapid entry into Africa has fueled a rush to the continent by Western and other economies, including India and Brazil, and the region's economy has grown more than 6 percent in the last decade. Trade in goods between the United States and the East African bloc grew by 52 percent to $2.8 billion in 2014, according to federal data. Exports were at $2 billion, while imports totalled $743 million. All five countries currently take part in the African Growth and Opportunity Act, a program that grants African countries duty-free access to U.S. markets. The program is set to expire later this year and the White House has already kicked off an early bid to raise congressional support for a renewal. The East African region could become even...

A cloud of uncertainly is hanging over the local sugar industry after a deal that has locked out cheap imports expired Sunday without a clear guideline from market regulators. The local firms said the expiry of the Common Market for Eastern and Southern Africa’s (Comesa) safeguards on Sunday has left them exposed to cheap sugar smuggled from other parts of the world. “Our sugar can compete on equal footing with that from Comesa but we are concerned the opening of the market will inevitably result in increased dumping of illegal sugar,” Kenya Sugar Millers Association (KSMA) chairman Rai Tajveer told the Business Daily last Friday. The Ministry of Agriculture had applied for another two-year extension, the fourth it is seeking, on the imports quota despite, hoping to conclude pending reforms to boost competitiveness of the local sugar industry by 2017. On Friday, the millers played down concerns of a looming loss of market share to foreign sugar but warned of likelihood of increased dumping of the illicit commodity into the market in the absence of tight surveillance. Mr Tajveer raised the red flag over a lack of tight monitoring of imports, saying local millers were already facing competition from illicit sugar imports even with the safeguards in place. “This will compound the problem of dumping of sugar in the country, if left unchecked,” he said citing Madagascar and Somalia as popular source markets of illicit imports. But a decision by Kenya to maintain the ban on imports, on the basis...

The duty on cement imported into East Africa has been lowered from 35 per cent to 25 per cent, heralding good news for the construction sector. But manufacturers warn that the resultant price crash could send them out of business and lead to massive job losses. According to a gazette notice of the EAC released last month, apart from the reduction in the common external tariff (CET), cement has also been removed from the list of sensitive products that require protection until domestic industries can compete. Decisions on the CET are made by the East African Council of Ministers. Despite the current 35 per cent duty on cement from non-EAC countries, imports are still largely cheaper than the locally produced commodity. Cement manufacturers fear the latest move is opening a window to cheaper cement imports that are likely to leave them staring at idle capacity and losses. “This will only create unnecessary competition from manufacturers outside the region, leading to an influx of cheap cement imports,” said Ronald Ndegwa, Savannah Cement chief executive. Mr Ndegwa said that the costly business regime in East Africa will render the local firms uncompetitive against rivals who operate in “subsidised economies.” Electricity, which on average makes up 40 per cent of the direct cost of cement manufacturing, is four times cheaper in Asian countries. “Until the cost of production in the region comes down, we still feel that it is unfair to remove cement from the sensitive items list it is likely to put...

The East African Community Council of Ministers has initiated the process of fast-tracking the Non-Tariff Barriers Bill into law. This is expected to compel partner states to eliminate the numerous NTBs that hinder smooth movement of goods and services within the economic bloc. The EAC Elimination of Non-Tariff Barriers Bill, 2015 was passed by the East African Legislative Assembly in January to enable partner states to completely remove NTBs to allow free movement of goods, people and labour as a requirement by Common Market Protocol. Non-tariff barriers have been cited as the biggest threats to doing business in East Africa. While the five EAC partner states have agreed in principle to remove non-tariff barriers by December this year, this largely depends on good faith on the part of the five countries due to the absence of a legal framework. A report on the status of NTBs released last year indicates that last year, the economic bloc eliminated 66 per cent of the non-tariff barriers, enhancing trade. The report, which was released by the EAC Secretariat, showed that 18 NTBs remained unresolved while four new ones were introduced by the partner states. However, 78 NTBs were reportedly resolved cumulatively by the member states. Tanzania, Kenya and Uganda were reported to have imposed the highest number of NTBs during the period under review while Burundi had the least, with Rwanda imposing none. The new and the unresolved NTBs are mostly restrictions imposed on Customs and administrative entry procedures, technical barriers to trade...

East African economies are showing promising growth prospects for 2015, but the falling prices of key commodity exports and the region’s mounting debt burden remain a threat. The region’s growth is expected to average six per cent this year, up from about 5.5 per cent recorded in 2014, driven by increased investments in infrastructure, falling inflation and an expected surge in private-sector lending. However, this growth is dimmed by plummeting prices for tea and coffee, the region’s two leading exports, which have reduced export earnings and widened the current account deficit of Tanzania and Kenya. Tea prices have been depressed by oversupply, while poor rainfall has hurt coffee output. In Uganda and Burundi, a supply glut and lower production have seen depressed earnings from tea and coffee. In the 2014 season, Uganda reported coffee exports worth $394 million, representing a 2.3 per cent drop in volume and nine per cent decrease in value from the previous year. Uganda sold its coffee at an average of $1.87 per kg, down from $2 per kg the previous year. In Burundi, earnings from coffee fell to $23.8 million in 2014, from $66.3 million in 2013, attributed to unpredictable weather conditions and a lower-yielding crop cycle. Tea earnings fell six per cent in the first nine months of 2014. Kenya’s tourism sector, one of the key drivers of dollar earnings, contracted by about 14 per cent during the third quarter of 2014, but is expected to make a comeback as the security situation stabilises....

THE East African Community (EAC) Council of Ministers has urged the trading bloc to fast track the implementation of the Regional Postal Sector Strategy, an official said over the weekend. EAC Director of Infrastructure Philip Wambugu told a regional forum in Nairobi that a baseline survey for the regional postal sector has already been concluded. “A meeting to consider the report of the survey has been scheduled for May 2015,” Wambugu said during the East African Communications Organization Postal Conference on Leveraging Information Communications Technology in the Transformation of the Postal and Courier sector in the region. Wambugu said that the report of the survey is rich in information on the current state of the sector as well as insights on the way forward. He said that the strategy would assist EAC partner states to harmonize their policies, laws and regulations for the sector. In the recent years the region has liberalized the sector, which led to a development of a vibrant private sector. The director said that development of the postal sector cannot take place without the involvement of the private sector. According to the EAC official, electronic commerce presents a great business opportunity for the postal sector. “This is because physical goods bought online have to be delivered physically to the buyer,” Wambugu said. “However, the challenge is for postal operators to develop strategies for exploiting the opportunities that ecommerce provides,” he said. Source: Daily News

East Africa Court of Justice (EACJ) has dropped a case filed by three Tanzanians challenging a decision by Kenya, Uganda and Rwanda to lock out their country from a tripartite deal to fast-track East African integration. The court allowed an application by Ally Msanga, David Makatha and John Bwenda to have the case discontinued, citing financial restrains that would not allow them to challenge the move by the three countries to have Tanzania out of the agreement. The tripartite agreement was to have the three nations carry out major infrastructure projects and trade together. The triumvirate, branded by a section of the media as a coalition of the willing, also mooted a political federation. “The applicants have sought to discontinue with the case. Since the respondents have no objection, the reference is marked as discontinued by consent of parties,’’ a bench composed of Justices Jean Butasi, Isaac Lenaola, Faustin Ntezilyayo, Monicah Mugenyi and Fakihi Jundu ruled. The three Tanzanian citizens had sued the Secretary General of the East African Community and the Attorney Generals of Kenya, Uganda and Rwanda, arguing that the three countries had broken a treaty that established the community when presidents Uhuru Kenyatta, Paul Kagame and decided Yoweri Museveni formed a block for development that side-lined Tanzania. The subject matter of the case was the resolutions and communiqués made at the meetings held by Kenya, Uganda and Rwanda on June 24 and 25, 2013, in Entebbe Uganda, August 28, 2013 in Mombasa, Kenya and October 28, 2013...