EAC 

Sunday, February 16, 2014 

US gives $25million for improving regional trade

DAR ES SALAAM, Tanzania - The United States government has signed a cooperative agreement with TradeMark East Africa (TMEA) worth $25million signifying partnership with President President Barack Obama’s Trade African Initiative.

The signing took place recently in Nairobi Kenya between the officials from the United States Agency for International Development (USAID) and TradeMark East Africa (TMEA). TMEA is based in Nairobi.

A statement availed to East African Business Week reveals that basically the aim is to increase trade within East Africa by reducing the time and cost of transiting and transporting goods across the region. 

The partnership will also support East African Community (EAC) regional integration. Through Trade Africa, TMEA will broaden its regional integration program at the ports of Mombasa and Dar es Salaam and key border posts along the Northern and Central Corridors, and will work with EAC Member States to remove barriers to trade. 

“In July, 2013, President Obama announced the United States Trade Africa Initiative, a new partnership between the United States and sub-Saharan Africa that seeks to increase internal and regional trade within the East African Community, and expand trade and economic ties between Africa, the United States, and other global markets,” USAID’s Associate Administrator, Mark Feierstein said in his remarks.

He said the agreement signed will unite donor efforts across the region to support the EAC to implement the shared vision of a prosperous, growing East Africa.

TradeMark CEO Frank Matsaert said trade infrastructure is critical to East Africa’s prosperity, and in creating much needed employment in the region. 

Currently East Africa’s trade corridors are characterized by long transit times and high costs.  

“Freight costs per kilometre are more than 50% higher than costs in the United States and Europe, and for the landlocked countries, transport costs can be as high as 45% of the value of exports,” Matsaert said.

He said the US is an important partner in promoting regional and economic integration in East Africa. 

Matsaert confirmed that TMEA will continue to focus its efforts on increasing trade and prosperity in East Africa, primarily through investments that have the biggest benefit for East Africa’s people and the private sector. “This investment supports those projects that provide the catalyst needed to bring prosperity to the region,” Matsaert said. 

He said that Trade Africa will assist TMEA to address economic growth constraints by promoting intra-regional exports, as well as enabling exports to new markets including the US. 

The partnership will also help reduce the barriers to cross-border trade which can result in a 15%  reduction in average time to import or export a container from Mombasa or Dar es Salaam to Burundi and Rwanda and a 30% decrease in the average time a truck takes to cross selected borders.

“By reducing the time and costs of moving goods and services across borders, Trade Africa will both support greater intra-regional trade within the East African Community and support greater U.S.-EAC trade and investment, including under the African Growth and Opportunity Act,” Florizelle Liser the Assistant US Trade Representative for Africa said. 

Feierstein and Gast were in Kenya last  week to evaluate the progress of President Obama’s initiatives toward fostering public-private partnerships to address U.S. and Kenya’s shared development objectives.

TradeMark East Africa is a company limited by guarantee (with offices in all East African countries, as well as Juba, South Sudan) that provides technical and monetary support to the EAC Secretariat, national governments, private sector and civil society to improve the ease of trading in East Africa through an emphasis on streamlining port, transit, customs and border operations in order to enhance trade.  It has been supported largely by European bilateral donors and works to promote rapid advances in East Africa’s economic integration, trade and global competitiveness for all East Africans.

By Patrick Kisembo, Sunday, February 16th, 2014