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Wednesday, 29 April 2015 09:33

EACCIA: Facilitating Business in East Africa

Charles-Kahuthu_EACCIAARUSHA, Tanzania, April 29, 2015 (Buziness Africa) -- The East African Chamber of Commerce, Industry and Agriculture (EACCIA) was established in September 2005 under the Laws of Kenya and was formally launched in Arusha, Tanzania, in February, 2006. Since then, EACCIA has been in the forefront in promoting public private partnerships (PPPs) agenda across the entire EAC member states.

In this exclusive interview, Charles Kahuthu, Regional Coordinator and CEO at the East African Chamber of Commerce, Industry and Agriculture (EACCIA) speaks to Kester Kenn Klomegah, Regional Editor-in-Chief for Russia and Eurasia at Buziness Africa, about the chamber’s achievements, all kinds of services it offers, incentives that are available and emerging business opportunities for potential foreign investors the East African market.


Interview excerpts below:

Buziness Africa: What would you say are some of your remarkable achievements and successes of your organisation over the past few years? What are the emerging business opportunities for potential foreign investors the East African market?


Charles Kahuthu: The East African Chamber of Commerce, Industry and Agriculture (EACCIA) was established in September 2005 under the Laws of Kenya and was formally launched in Arusha, Tanzania, in February, 2006. The objective for its setting up was to support the members of the business community in the three East African Community member states of Kenya, Tanzania and Uganda which were at that time members of the EAC was to better understand the new EAC Customs Union Protocol for the purpose of facilitating trade across the borders. Its specific objective was, and still remains, to facilitate trade and investment across the EAC member states, particularly for small and medium enterprises (SMEs). Some of the key successes for EACCIA since that time are:


i. With the support of Common Market for Eastern and Southern Africa (COMESA), the Chamber, in 2012-13 embarked on a programme for establishing cross border traders associations (CBTAs) in all the various border points of the EAC member states in order to facilitate “cross border trade” by SMEs from all EAC member states. We set up desks officers at those border points to assist SMEs move across and understand Customs requirements. This has been a major milestone as SMEs are now trading across the borders freely.


ii. In 2012, we embarked on a regional study to establish the level of understanding and preparedness of the private sector in the EAC to implement PPP projects, jointly with their governments. The conclusion of the study was extremely telling, since it was quite obvious that both parties to the partnership lacked full understanding of what the PPP framework is all about. EACCIA decided to establish a number of Project Advisory Units (PAUs), anchored within the national chambers of commerce of the EAC member states to address this capacity and knowledge gap. The objective of the PAU is to support their members formulate proposals aimed at responding to “requests for proposals” by governments for the private sector to participate in PPP projects. This intervention was supported by the ACP Business Climate Facility (BizClim) of the European Union.


iii. EACCIA has been in the forefront in promoting public private partnerships (PPPs) agenda across the entire EAC member states, including those of the Northern Corridor (Democratic Republic of the Congo and South Sudan). We have recently launched a PPP Guidelines and Handbook for use by both public and private sectors. We are working on this intervention together with the Secretariat of the Northern Corridor Transit and Transport Coordination Authority (NCTTCA) and EAC Secretariat.


iv. We Memorandum of Understanding (MOU) with Kenyatta University, in Nairobi, Kenya, to establish a PPP Training Programme for all East Africa. This is intended to facilitate building of adequate capacity for PPP Experts in the region which both governments and the private sector can tap into when implementing PPP projects. It is in this regard that we are also trying to ensure that the SMEs in the region can be able to participate in the major PPP projects, which our governments are implementing.


v. We also have a major function of ensuring that national chambers of commerce in the EAC member states are performing as they should, by ensuring that we support them in their times of need, including building their capacities through training.


KOR_6506BA: To what extent are foreign investors involved in investment sectors in the region? What are the possibilities for foreign investors to get engaged in medium-sized business in East Africa?


CK: The EAC region is open to FDI and foreign investors from whichever country are welcome. All the countries in the EAC have various incentive programmes that are attractive to foreign investors. If a foreign investor, for instance, wants to invest in Rwanda, all his/her needs shall be met through only one institution, the Rwanda Development Board. An investor can have a business established in a couple of hours and also negotiate for a business loan within the same one day, whether he/she is a foreigner or an East African. All the other countries have, more or less, similar “One-Stop” arrangements, thus reducing the burden of an investor to move from office to office. The SMEs are particularly welcome and, in fact, the bulk of foreign investors in the region are SMEs.


BizClim has supported the EU Business Forum in Ethiopia (EUBFE) to do this in their country. They have identified barriers to an improved investment sector, and together with the Government and other stakeholders, have sought to better the administrative processes to encourage more FDI. All this was discussed at the EUBFE Conference on 1st April 2015, in Addis Ababa, which brought together some best practice examples of this process in East African nations.


BA: Are there any restrictions for foreigner players in medium-sized businesses? What incentives are offered by the East African governments for foreigners? What about investment protection?


CK: No. As mentioned earlier above, the entire EAC region is a liberalized economy with free flow of both capital and labour across borders.

BA: What significant business challenges in “Doing business in East Africa” still remain to overcome in the near future? What business prospects are there in the region?


CK: There are a few Non-Tariff Barriers still remaining to be addressed, but overall, the EAC region is a good investment location. The port of Mombasa, which serves the hinterland countries, has greatly improved and enhanced its operations and it is now taking less than four days for cargo destined to those countries to clear the port and reach its destination, in Uganda, Rwanda or Burundi. The infrastructure is also functional and has improved greatly in the last five years. We also have a very large pool of skilled labour force in the region, particularly in Kenya.


BA: Looking into the future, how does your organisation plan to increase cooperation with foreign business community especially from emerging regions such as Russia, EurAsia region and former Soviet republics?


CK: We are already cooperating with many foreign business communities through their chambers of commerce where we have signed a number of cooperation MOUs. We collaborate with EU-ACP Chamber of Commerce, based in Brussels, Chamber Trade Sweden, African Polish Chamber of Commerce, Federation of Gujarat Industries of India, Apex Brazil, etc and, through those apex business organizations, we are able to reach out to the business community in those regions/countries. We are ready to establish similar partnerships with Russia, Eurasia region and those former Soviet republics. (Source: Buziness Africa)


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