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Industrialization & SME Development

EAC Extra Ordinary Council on Trade, Industry and Investment dedicated to Industrialization and SMEs concludes in Arusha

East African Community Headquarters, Arusha, 14th September, 2018: The Extra Ordinary Sectoral Council on Trade, Industry, Finance and Investment dedicated to Industrialization and Small Medium Enterprises( SCTIFI) concluded at the EAC Headquarters in Arusha, Tanzania at the level of the Permanent /Principal Secretaries.

The extra-ordinary dedicated SCTIFI was convened deliberately to discuss  on industrialization matters in the community which has become a major agenda for the EAC Heads of State Summit.

Among the items on the agenda were the consideration of the: EAC Automotive Industry Action Plan and Draft Concept note on the local assembly/ manufacture of  affordable vehicles; Establishment of a Regional Automotive Industry Council/Platform  of East  Africa (AICEA); Concept Note on the manufacture/production of Low Cost Vehicles (Affordable Vehicles) in the Region and Age Limit for imported Used Vehicles.

Speaking at the opening session of the Permanent /Principal Secretaries, the EAC Deputy Secretary General in charge of Planning and Infrastructure,  Eng. Steven Mlote, noted that the dedicated session was important step to the prioritization of industrial development in the Community and a demonstration of regional commitment towards industrialization.

He underscored that  the decision to convene a dedicated meeting on industrialization  is a landmark achievement and a blessing as it signifies the priority the region is giving to industrialization issues, which have assumed prominence in the integration agenda.

Eng. Mlote disclosed to the meeting that the region is  making good progress towards implementing the Summit directives on the Automotive; Cotton, Textiles and Apparels; Leather Sector and Pharmaceutical Sectors. The Community has reached a stage of integration where Industrial development and the promotion of manufacturing have become much more important and necessary than ever added, Deputy Secretary General.

The Deputy Secretary General informed the meeting that ordinarily, it would have been more reasonable to propose for a Separate Sectoral Council to deal specifically with industrialization and SMEs sector, however, mindful of the need for rationalization and resource constraints, we proposed the forgoing as a stop gap alternative, stated Eng. Mlote.

-ENDS-

For more information, please contact:

Mr Owora Richard Othieno
Head, Corporate Communications and Public Affairs Department
EAC Secretariat
Arusha, Tanzania
Tel: +255 784 835021
Email: OOthieno [at] eachq.org

About the East African Community Secretariat:

The East African Community (EAC) is a regional intergovernmental organisation of five Partner States, comprising Burundi, Kenya, Rwanda, Tanzania and Uganda, with its headquarters in Arusha, Tanzania. 

The EAC Secretariat is ISO 9001:2008 Certified

Brainstorming meeting for promoting establishment of an EAC Regional Automotive Industry and EAC Vaccine/Pharmaceuticals Manufacturing Facility held in Arusha

East African Community Headquarters, Arusha, 23rd July, 2018: A one-day brainstorming meeting to promote the automotive industry and vaccine manufacturing with support from German companies Merck, Bosch and the World Economic Forum (WEF) was held on Monday 23rd July 2018, 2018 at the EAC Headquarters in Arusha, Tanzania.

The brainstorming meeting, which was chaired by the EAC Deputy Secretary General in charge of Productive and Social Sectors, Hon. Christophe Bazivamo was attended by Dr. Kirsten Focken, the Programme Manager, Head-EAC-GIZ Programme based in Arusha, the Executive Secretary, East Africa Health Research Commission (EAHRC), Prof. Gibson Kibiki and technical officers from the department of Industrialization and Small and Medium Enterprises (SMEs) sector. Also in attendance were, Ms. Elsie Kanza, Head of Africa, World Economic Forum, Mr. Thill Markus President of Region Africa, Robert Bosch (Pty) Ltd, Mr. Manuel Batz and Mr. Mwai Ngibuini from Merck and Ms. Angelika Farhan from EABC.

Addressing the meeting, Hon. Bazivamo hailed the initiatives taken by the above Foreign Partners to assist EAC in driving the process of promoting the establishment of an EAC Regional Automotive Industry Plant and an EAC Regional Vaccine and Pharmaceuticals Manufacturing Facility noting that local manufacture of products and improvement of the required infrastructure especially for the health sector have been given high priority in the 5th EAC Development Strategy and also as directives of the 19th EAC Heads of States Summit . He pointed out that the initiatives are beneficial and feed well to the already existing policies in the EAC including the 5th EAC Development Strategy, the Industrialization Strategy (2012-2012) and the EAC Regional Pharmaceutical Plan of Action (2017-2027). He urged the collaborating partners to urgently come up with an Implementation Framework and a pragmatic Roadmap for advancing the two initiatives.

On her part, Dr. Focken, the Cluster Coordinator-EAC-GIZ Programme in Arusha, thanked all the participants for active participation towards the proposals. She said fast tracked implementation of the two initiatives would achieve tangible results to the citizens of East Africa and demonstrate the benefits of regional integration.

Mr. Manuel Batz, Director Sales Middle East and Africa, informed the meeting that for instance, by 2020 GAVI support to vaccines in the region will be scaled down and the region needs to be prepared with locally manufactured vaccines. He pointed out that it is imperative for the region to build its capacity in manufacturing vaccines by developing business models that have worked in other regions of the world. He proposed the following as measures to fast track the development of vaccines manufacturing: strong government action including enacting of enabling policies; implementation of a regional public procurement scheme for vaccines; identification of a selected number of vaccines to be prioritized for development of a negotiated regional common agreement to develop the vaccine among other measures.

Mr. Thill Markus, President of Region Africa, Robert Bosch (Pty) Ltd, informed the meeting that despite the fact that the EAC market for passenger, light vehicle is currently small and fragmented accounting for 6% of Africa’s demand and 0.5 of global demand making it difficult to justify local manufacturing, a step change is possible if the region can create a single regional market and enact policies to encourage new vehicle demand, and drive trade deals to enable exports that could justify the development of a sizeable local manufacturing industry, similar to the Association of Southeast Asian Nations (ASEAN) and Morocco. He called on the region to make the right policies that would make the automotive manufacturing a major job creator and economic stimulator for the region, injecting over $840M in foreign direct investments per year and creating ~52,000 direct jobs in the first stage of major industry growth. He gave example of growth levers such as stimulating demand through trade policies, enabling consumer financing, encouraging supply through tax incentives and the creation of an auto-focused industrial zone that have worked in countries like Morocco.

In order to take forward the initiatives, the partners agreed on the establishment of a taskforce for each of the two initiatives that will detail out and evaluate the EAC Partner States opportunities and comparative advantage, as well as design a roadmap for action and begin investment attraction with specific potential investors. The ultimate goal of the process would be the establishment of regional vaccines/pharmaceuticals facility and a regional automotive plant that will privilege regional economies of scale and value/supply chains.

-ENDS-

For more information, please contact:

Mr Owora Richard Othieno
Head, Corporate Communications and Public Affairs Department
EAC Secretariat
Arusha, Tanzania
Tel: +255 784 835021
Email: OOthieno [at] eachq.org

About the East African Community Secretariat:

The East African Community (EAC) is a regional intergovernmental organisation of five Partner States, comprising Burundi, Kenya, Rwanda, Tanzania and Uganda, with its headquarters in Arusha, Tanzania. 

The EAC Secretariat is ISO 9001:2008 Certified

 

EAC Unveils Industrial Competitiveness Report 2017

East African Community Headquarters, Arusha, 11th November, 2017:

The East African Community (EAC) in partnership with the United Nations Industrial Development Organization (UNIDO) and the Government of Korea on Friday launched the EAC Industrial Competitiveness Report 2017 (ICR 2017) in Dar es Salaam, Tanzania.

Themed ‘Harnessing the EAC Market to Drive Industrial Competitiveness and Growth,’ the report assesses EAC’s industrial performance vis-à-vis other regions and role models in Asia and Africa and sheds light on strategic short- and long-term industrialization paths that the EAC should pursue.

ICR 2017 provides a compass to policy-makers, the private sector (in particular manufacturing firms and associations), and a wide range of stakeholders on the broader direction of the industrial development trajectory of the EAC and of the internal competitiveness dynamics among Partner States.

Speaking at the event, Uganda’s Minister of State for EAC Affairs, Hon. Julius Muganda, said that Industrialization in the context of the EAC region will depend on how the region strategically leverages itself to maximize on the opportunities created by the Common Market Protocol as a stimulus for demand, while simultaneously capitalising on other emerging markets for manufacturers.

“The realisation of a fully functioning Common Market and the deepening of regional integration through a monetary union are crucial for providing the much-needed impetus for industrialisation in the region,” said Hon. Muganda, who represented the Chairperson of the EAC Council of Ministers, Hon. Kirunda Kivejinja, Uganda’s Deputy Prime Minister and Minister for EAC Affairs.

Hon. Muganda further emphasized on the need for leaders and technocrats to think of a collective regional strategy to respond to unemployment including expanding the manufacturing sector capacity and promoting micro, small and medium enterprises (MSMEs) and youth entrepreneurs.

In his remarks, the Director of Trade at the EAC Secretariat, Mr. Alhaj Rashid Kibowa, contribution of the manufacturing sector remains at paltry 10 percent, adding that the sector has been on a decline in the recent past.

“It is against this background and in recognition of the existing challenges that the region embarked on the programme “Strengthening Capacities for Industrial Formulation and Implementation in the East African Community,” said Alhaj Kibowa.

Alhaj Kibowa noted that the implementation of the programme had enhanced the region’s capacity for industrial policy design, monitoring and evaluation, culminating into the development of the ICR 2017.

“Consistent with the EAC Industrialization Policy and Strategy, the ICR 2017 has enhanced the region’s capacity to: design, manage and implement an industrial policy and collect industrial statistics and data. Further to this, it has strengthened the institutional capacity of the EAC Secretariat, Governments of all EAC Partner States and key private sector stakeholders,” said Alhaj Kibowa.

Also present at the launch of the report was South Korean Ambassador to the United Republic of Tanzania, H.E. Geum-Young Song who reaffirmed his country’s commitment to continue supporting the EAC in realizing its goal of industrialization.

Dr. Stephen Kargbo, UNIDO representative to Tanzania, Mauritius and EAC speaking at the ICR 2017 launch expressed hope that the EAC would use the findings of the report to revitalize the industrial sector in East Africa.

“While we conclude successfully the implementation of the current regional project, we are also exploring with our main counterpart, the EAC Secretariat, options for a phase II that would ensure produced diagnostics translate into concrete industrial policy processes, instruments and action plans creating significant positive impact for the industrial development in the region,” said Dr. Kargbo.

He also assured stakeholders that whereas UNIDO will continue to play its role, supporting relevant institutions in capacity building activities for strengthening industrial policy making capacities, it was the responsibility of Partner States’ governments and other stakeholders to transform the initiative into meaningful strategies for the attainment of sustainable and inclusive economic development in EAC.

Prof. Elisante Ole Gabriel, the Permanent Secretary in Tanzania’s Ministry of Industry, Trade and Investment, urged EAC Partner States to foster close cooperation in order to realize sustainable competitive advantage on the global market.

Closing the one-day event, the EAC Deputy Secretary General in charge of Planning and Infrastructure, Eng. Steven Mlote, said that East Africa was on the way to becoming a regional hub for manufacturing and a gateway to investment in Africa.

“To be successful in this venture, our industrial policies should seek to promote structural changes,” said Eng. Mlote.

Implementation of phase two of the project will switch from diagnostics to industrial policy processes and instruments. This means that the focus will be on the establishing a regional industrial intelligence and policy advisory support, enhancing capacity for competitiveness analysis of the Industrial sector, putting in place a regional competitiveness framework to facilitate benchmarking and establishing an e-Industrial information Resource Centre.

Note to Editors:

The EAC Secretariat in collaboration with UNIDO is implementing a programme on “Strengthening Capacities for Industrial Policy Formulation and Implementation in the East African Community” which was approved by the Sectoral Council on Trade, Industry, Finance and Investment during its meeting held on 22nd May, 2015.

Through the Programme, specific trainings have been delivered at both national and regional levels to create, among other things, capacity for industrial competitiveness analysis as envisaged in the EAC industrialization policy and Strategy. As a result, the programme has greatly contributed to enhancement of capacity for industrial policy, analysis, design, monitoring and evaluation at Partner States and the Secretariat levels.

To ensure sustainability and full use of knowledge acquired in the trainings, the Secretariat in collaboration with UNIDO and a team of experts from Partner States took the initiative of preparing the EAC Industrial Competitiveness Report, 2017 (ICR-2017).

DOWNLOAD: EAC INDUSTRIAL COMPETITITVENESS REPORT 2017 (Summary Report)

DOWNLOAD: EAC INDUSTRIAL COMPETITITVENESS REPORT 2017 (Main Report)

-ENDS-

For more information, please contact:

Mr Owora Richard Othieno
Head, Corporate Communications and Public Affairs Department
EAC Secretariat
Arusha, Tanzania
Tel: +255 784 835021
Email: OOthieno [at] eachq.org

About the East African Community Secretariat:

The East African Community (EAC) is a regional intergovernmental organisation of five Partner States, comprising Burundi, Kenya, Rwanda, Tanzania and Uganda, with its headquarters in Arusha, Tanzania. 

The EAC Secretariat is ISO 2008:9001 Certified

EAC to launch Industrial Competitiveness Report 2017 in Dar es Salaam

East African Community Headquarters, Arusha, 8th November, 2017:

The East African Community (EAC) together with the United Nations Industrial Development Organization (UNIDO) will launch the first ever EAC Industrial Competitiveness Reports (ICR, 2017) on 10th November 2017, in Dar es Salaam, Tanzania.

The aim of the ICR is to provide a compass to policy-makers, the private sector (in particular manufacturing firms and associations), and generally a wider range of stakeholders on the broad direction of the industrial development trajectory of the EAC and of the internal competitiveness dynamics among Partner States.

The report assesses EAC’s industrial performance vis-à-vis other regions and role models in Asia and Africa and sheds light on strategic short- and long-term industrialization paths  that EAC should pursue.

The Draft  report has been presented and discussed at various consultative meetings culminating in its validation, by the programme Regional Steering Commitee, at the regional workshop held in March 2017 in Dar-es-Salaam, Tanzania.

Speaking ahead of the launch the EAC Deputy Secretary General in charge of Productive and Social Sector, Hon Christophe Bazivamo, said the report provides a synopsis on the ‘State of Industrial Competitiveness in the region and highlights the policy actions required to restore or sustain competitiveness.

Notes to Editors

The EAC Secretariat in collaboration with UNIDO is implementing a programme on “Strengthening Capacities for Industrial Policy Formulation and Implementation in the East African Community” which was approved by the Sectoral Council on Trade, Industry, Finance and Investment during its meeting held on 22nd May 2015. 

Through the Programme specific trainings have been delivered at both regional and national levels to create, among others, capacity for industrial competitiveness analysis as envisaged in the EAC Industrialization Policy and Strategy. As a result, the programme has greatly contributed to enhancement of capacity for industrial policy analysis, design, monitoring and evaluation at Partner States and the Secretariat levels.

To ensure sustainability and full use of knowledge acquired in the trainings, the Secretariat in collaboration with UNIDO and a team of experts from Partner States took the initiative of preparing an EAC Industrial Competitiveness Report, 2017 (ICR-2017).

-ENDS-

For more information, please contact:

Mr Owora Richard Othieno
Head, Corporate Communications and Public Affairs Department
EAC Secretariat
Arusha, Tanzania
Tel: +255 784 835021
Email: OOthieno [at] eachq.org

About the East African Community Secretariat:

The East African Community (EAC) is a regional intergovernmental organisation of five Partner States, comprising Burundi, Kenya, Rwanda, Tanzania and Uganda, with its headquarters in Arusha, Tanzania. 

The EAC Secretariat is ISO 2008:9001 Certified

EAC to release inaugural Industrial Competitiveness Report 2017

East African Community Secretariat; Arusha, Tanzania; 24 July 2017:

The East African Community Secretariat has prepared the 1st regional Industrial Competitiveness Report 2017, which will be released to the public in October 2017.

The inaugural Industrial Competitiveness Report (ICR) 2017 is the result of collaboration among selected experts from the EAC Secretariat and Partner States, from both public and private sector, trained by United Nations Industrial Development Organization (UNIDO) experts in selected courses and methodologies, including the UNIDO Competitiveness Industrial Performance Analysis, under the regional project Strengthening institutional capacities for industrial policy in the East African Community (EAC) and funded by the Republic of Korea.

Addressing a stakeholder workshop convened to discuss the findings at the EAC Headquarters on Thursday 20th July 2017, the EAC Deputy Secretary General (Finance and Administration), Hon. Jesca Eriyo said the Report was one of the analytical output stemming from the EAC-UNIDO Programme for Strengthening Institutional Capacities for Industrial Policy Management, Monitoring and Evaluation.

Hon. Eriyo reiterated that the Community had made tremendous progress in its integration roadmap and that the market enlargement arising from the Common Market had created immense opportunities for doing business in the region but more importantly, opportunities for increasing production, diversification of economic base, realization of economies of scale; and finally opportunities for accelerating industrialization in each Partner States and EAC region as a whole.

The Deputy Secretary General, who represented the Secretary General, Amb. Liberat Mfumukeko at the occasion, said that in the EAC Region, the capacity and performance of the public sector that deals with industry related matters was generally low, and as a result, implementation of industry related policies and strategies had in some cases been inadequate, constrained by a number of factors, including inadequate industrial governance systems as well as weak monitoring and evaluation frameworks.

She noted that other issues that need to be addressed to foster and sustain industrial growth include inadequate  capability to design,  implement and monitor policies and strategies; challenges to enhance private sector participation; and inadequate  systems for collecting, processing, storing and dissemination of  industrial information, among others.

The EAC official commended the Government of Korea for financing the programme and UNIDO, who is the implementing partner.

Addressing the same workshop, the EAC Deputy Secretary General in charge of Planning and Infrastructure, Eng. Steven Mlote decried the huge amount of resources that the Community is losing in exporting raw materials, leading to the loss of job and investment opportunities. He reiterated the need for the region to work together in developing the manufacturing sector rather than competing against each other.

The EAC Principal Industrial Economist, Mr. George Ndira said industrialization should be a concern for the EAC Secretariat and it (Secretariat) should continue advocating for industrialization as it is the surest way to lift Partner States’ economies from the dependency syndrome and help in pulling millions of the population from abject poverty.

Mr. Ndira, who was representing the Director for Productive Sector, said the ICR is a compass to assist the region in monitoring our progress towards the goal of economic transformation and diversification. “This workshop is an opportune moment for all us to understand where we are and how much distance we are yet to cover to get to a stable state for long-term economic prosperity” noted the EAC Principal Industrial Economist.

While presenting the findings of the EAC Industrial Competitiveness Report 2017, Mr. Andrea Antonelli from UNIDO’s Research and Industrial Policy Advice Group, said the main objective of the Report was to provide a compass to policy-makers, the private sector, and generally a wider audience of stakeholders interested and/or involved in industry on the broad direction of the industrial development trajectory of the EAC.

He said the Report was also intended to provide evidence-based, shared and implementable policy recommendations for the EAC and Partner States’ policy makers; and to generate further awareness on the importance to coordinate economic development activities in the EAC around a common goal to enhance industrial/manufacturing development.

“Specifically, the study was to provide a useful diagnostic tool for the EAC Secretariat as an important input to review its Industrial Policy and Strategy; act as a monitoring tool to assess progress against EAC and national industrial development targets and present a list of agreed indicators for EAC harmonized industrial performance assessment; among others” affirmed the UNIDO official.

The report, which will be launched and availed to the public in September/October 2017, states that Manufacturing Value Added (MVA) and manufacturing trade growth rates sustained by the EAC in recent years stand above global average but only around average of Sub-Saharan Africa.

However, these growth rates fall short of some of the targets set in the EAC Industrialization Policy and stand below similar Regional Economic Communities in Sub-Saharan Africa including ECOWAS.

The same growth rates of the manufacturing sector have not kept pace with the service sector, thus insufficient to impress that acceleration needed to achieve the structural change targets set in the regional and in most national industrial policies/overarching development plans.

The report argues that an important cause and at the same time consequence of this limited performance lies in the disconnected fabric of the industrial sector in the EAC Partner States, impressing only weak backward and forward linkages among manufacturing subsectors as well as with non-manufacturing sectors of the economy. Strong interlinkages would strengthen the economy and foster a more robust industrialization process.

On the other side, the past 10-15 years have shown signs of upward convergence among Partner States both in terms of MVA and manufacturing trade values, particularly with Tanzania, Uganda and Rwanda growing significantly faster than their regional role model, Kenya.

The EAC regional market proves to be one of the most dynamic markets in the world and hence provides a great opportunity for regional firms to expand.

While in most cases EAC manufacturing firms managed to increase their intra-regional exports in certain dynamic sectors, this did not happen at the pace and extent needed to match the EAC demand growth, thus resulting in the EAC losing market shares particularly against emerging economies such as India (pharmaceuticals, heavy petroleum), China (iron and steel products and fertilizers) and Malaysia (Fixed vegetable oils).

The above findings call for renewed efforts to boost the manufacturing sector in the region and in Partner States and should not discourage the latest emphasis placed by many Partner States in this important common endeavour. 

The comments received during the stakeholders workshop is expected to enrich phase two of the regional program on “Strengthening Institutional Capacities for Industrial Policy Management, Monitoring and Evaluation in the EAC region”.


- ENDS -

For more information, please contact:

Mr Owora Richard Othieno
Head, Corporate Communications and Public Affairs Department
EAC Secretariat
Arusha, Tanzania
Tel: +255 784 835021
Email: OOthieno [at] eachq.org

About the East African Community Secretariat:

The East African Community (EAC) is a regional intergovernmental organisation of five Partner States, comprising Burundi, Kenya, Rwanda, Tanzania and Uganda, with its headquarters in Arusha, Tanzania.

 The EAC Secretariat is ISO 9001: 2008 Certified


East African Community
EAC Close
Afrika Mashariki Road
P.O. Box 1096
Arusha
United Republic of Tanzania

Tel: +255 (0)27 216 2100
Fax: +255 (0)27 216 2190
Email: eac@eachq.org