Month: March 2010

Ugandan Rumbles Onwards

Uganda is on the come up. The progress that has been made has been substantial, especially in the Health and energy sector.  The country is getting tough with Oil companies that might damage long term growth in Oil exploration.

The government of Uganda has threatened to throw out rivaling oil companies in the country if their disagreements threaten the exploration of oil in the country…….

The oil resources in Uganda and indeed all other mineral resources belong to the people of Uganda, and government as the custodian of these resources has a duty to ensure that they are harnessed and developed for the benefit of its people”, the minister said.

“If the two companies disagreed, it will not have an impact on the government. If they squabble among themselves, or quarrel, I will not hesitate to invoke their license in the oil exploration. If they become a nuisance or involved in courts, I will throw them out. We cannot allow the delay in the oil exploration”, he said.

He added that “we cannot allow a monopoly situation by one company in the Albnertine Graben.

A trade show recently opened between it and Sudan.

The first ever trade show exhibition involving traders, businessmen and industrialists from Uganda and southren Sudan is to be held starting on Wednseday in the southern Sudan capital of Juba.

The two day trade show, according to south Sudan trade ministry official, Albert Lukudu, is an outcome of improved trade ties between the two countries and better business infrastructure in southern Sudan.

The pilot exhibition is for businessmen from both countries to link up and resolve business challenges.

Addressing the press in Juba, the Acting Consul General of Uganda, Habib Migadde said, “This is the first time a joint exhibition involving businessmen from Uganda and southern Sudan is taking place. That is good for the two countries. It is an ideal way for business professionals to discuss and find solutions in business registration and taxation issues.”

Migadde added that the exhibition is a way to deal with price fluctuations and to cut out the middle man.

This could ease tensions in Northern Uganda and Southern Sudan.  Not only that, the East Africa region is enjoying traded like never before.

Nations of eastern and southern Africa have been working for most of this decade to build an alliance to strengthen their position as an economic and trading force. They recognize that good governance and consistent policies throughout their region will create a better atmosphere for business and trade. An improved business climate will provide their people greater opportunities for jobs and prosperity.

Neighboring nations of the world are teaming up in regional trade groups, improving access to regional markets, and strengthening their economic integration. By committing the partners to clear and enforceable rules, these organizations promote transparency and good governance. The trend is marked by a string of acronyms stretching across the globe—APEC, Asia-Pacific Economic Cooperation; ASEAN, the Association of Southeast Asian Nations; NAFTA, the North American Free Trade Agreement; and, of course, the world’s most advanced regional market, decades in the making, the EU, the European Union.

Now, here comes COMESA, the Common Market for Eastern and Southern Africa.

COMESA has 19 member countries: Burundi, Comoros, Congo Democratic Republic, Djibouti, Egypt, Eritrea, Ethiopia, Kenya, Libya, Madagascar, Malawi, Mauritius, Rwanda, Seychelles, Sudan, Swaziland, Uganda, Zambia, and Zimbabwe. Fourteen of these states are already in a free trade area.

Trade development among our member nations is the cornerstone of our agenda, and we have pursued a variety of steps to liberalize and facilitate trade throughout our region in a process that economists call “integration.” We also have a vision for our relationship to lead to a common market and achieve monetary union, following the same course as the Europeans.

The COMESA Free Trade Area [FTA] gives us a type of trade bloc in which our countries have agreed to eliminate tariffs and quotas when we trade among ourselves. The next step for us in this process of economic integration will be to form a “customs union,” whereby we retain our free trade arrangements but also adopt a common policy for an external tariff imposed on goods imported from nonmember nations.

Trade in the region will improve for example

today goods being imported from Japan to Rwanda pass under the eyes of border officials at multiple points—as they are off-loaded from a ship at Mombasa, Kenya; when they pass overland from Kenya into Uganda; then again, as they pass the national border into neighboring Rwanda. They receive a final inspection from officials in Kigali. Under the Customs Union, the goods will simply be inspected and cleared only once in Mombasa. We believe reduced inspections for goods will benefit both business and the consumer, streamlining trade, reducing costs, and eliminating opportunities for corruption that can arise at each inspection point.

With a regional population of 400 million and a gross domestic product of almost US $420 billion, ours is an attractive region for investment and trade in this globalized world.

The 2009 economic crisis did not affect the country.

In his first address to a special sitting of the East African Legislative Assembly in Kampala Tuesday, President Museveni noted that the Ugandan economy had earned over 1.6 billion dollars from regional trade during the last financial year…………The widening cross border trade between Uganda, Southern Sudan, Eastern Congo, and Central African Republic had great benefits for the Ugandan economy Even during the recent economic crisis did not affect Uganda very much because of the regional trade,” said the Ugandan President.

Mr. Museveni has reaffirmed the need to lower cost of production and doing business in order to lure more investors to the East African Region. He said there is need to pay attention to development of physical infrastructure like roads, railways and improvements in electricity power generation.

More on President Museveni talking about trade and what the region needs.

Bookmark and Share

Morroco weathers 2009 Economic crisis?

Did Morocco weather the 2009 Economic crisis? Recent reporting suggests so.

Figures released recently by DEPF confirm the suspicions of observers of the Moroccan economy. Could it be that the country did not succumb to the crisis because it steered clear of the excessive financialization of its economy: A fundamental misstep that Western economies, particularly the U.S., paid heavily for? It could also be because the 2009 harvest was particularly good.

In fact, Morocco experienced a significant economic growth, driven by domestic demand, in the past year

The country’s construction industry showed a remarkable resistance to the crisis that hit the international real estate and construction sectors. Construction work continued unperturbed, and in comparison with 2008 cement prices rose by 3.4% at the end of 2009.

The reconstruction of one of the major roads in Casablanca, La Corniche, now completed, saw land reclamation from the sea as well as several other major construction works which are expected to significantly reshape the landscape and expand its hosting capacity.

Several causes identified

According to a Moroccan analyst, several factors explain the country’s economic success.

The primary cause is especially credited to a strong domestic demand, stemming from the rise of rural household income (evidence of a good 2009 agricultural season), an increase in consumer credits (the opposite of the trend observed in Europe, at the time, despite its more experienced banking sector) as well as the strengthening of the overall purchasing power by virtue of a general income tax reduction and salary increments.

The Moroccan government also got involved in the development of the business sector with a double digit spending increase in the state investment budget, without attracting any significant deficit in 2009.

A more resistant economy

Thus, the growth of the Moroccan economy appears to be healthy and solid despite a sluggish global economy.

Morocco is well poised to take full advantage of the global recovery, if it occurs, in 2010. More so because the export industry will enjoy an upward trend as it is confronted with a dynamic domestic demand.

Bookmark and Share