News Round-up

What Will Uganda Reap From the Common Market?
The signing of the much awaited EAC Common Market protocol after eight years of haggling has flung open the door for what is expected to be a rigorous fight for market space in the region. And once it takes off in mid-2010, it will expose areas of ill preparedness on the part of those who will struggle to take up the challenging open market as goods, services and labour will now move freely across the trading bloc of approximately 120 million potential consumers.

The pact removes all cross-border tariffs among partner states and use of Common External Tariff (CET), to protect the local producers against competition of cheap goods from third parties. That means goods and services produced and moving within the region will be treated with equal measure and labour force will be free to sell its services to the buyer with the best offer across the region.

Ministers Calls Skills to Fight Poverty
African countries must stop exporting raw materials to developed economies and promote value addition and create jobs to fight poverty, Nelson Gaggawala, Uganda’s State Minister for Trade said. The minister called for promotion of business skills to champion development. Gaggawala was speaking at the opening of the sixth entrepreneurship conference organised by Makerere University Business School (MUBS) and the College of Business at Southern University, Louisiana, US at Hotel Africana. He said products like honey, fish, vegetables and organic meat were on demand in the West, but Africa cannot sustain supply due to the luck of entrepreneurship skills.

Across the Border in Two Hours
New efficient border posts being considered by the EAC, Southern African Development Community (SADC) and COMESA blocs will significantly reduce the cost of cross-border trade. When they are in place, trucks hauling transit goods will enter partner states much faster. The new One Stop Border Posts will reduce supply chain transaction costs, spur higher trade flows and boost the competitiveness of regional industries.

The Chairman of the COMESA-EAC-SADC Tripartite Task Force of Chief Executive Officers, Juma Mwapachu, said that it currently takes two to three days for a haulage truck to cross the Chirundu border point on the Zambia-Zimbabwe border. He said that it costs each truck US$140 a day in fixed costs and drivers’ time and for three days, the cost per truck is US$420.

Export of Traditional Goods on the Rise
During September 2009, export of goods rose by 7.9 percent to US$2,671.7mn largely due to increase in export of traditional goods that went up by 32.2 percent to US$492.5mn. Improved exports performance was also recorded in manufactured goods, horticultural products, fish and fish products. In September 2009, the value of traditional exports increased to US$45.0mn from US$37.5mn recorded in August 2009 mainly on account of a rise in the export volumes of cotton, coffee and cloves. According to the Bank of Tanzania Monthly Economic Review for October, the increase was largely attributed to seasonality factors reflecting the onset of the export season for traditional exports.