East, southern African countries in $100m grain trade deal
Wednesday July 05 2017
Kenya's Agriculture Cabinet Secretary Willy Bett (right) and his Zambian counterpart Dora Siliya during a press conference on bilateral trade agreements between the two countries in Nairobi on July 4, 2017. PHOTO | SALATON NJAU | NMG
Grain traders in East and southern Africa countries are set to benefit from trade deals worth $100 million signed in Zambia that will see the export of 383,640 tonnes of commodities.
This is expected to strengthen food trade links between southern Africa countries – Zambia, Malawi, South Africa and Zimbabwe – and those from the East – Kenya, Uganda, Rwanda and Burundi.
The contracts were signed in Lusaka last week during a forum organised by the Eastern Africa Grain Council (EAGC) and Zambian Commodity Exchange (Zamace) with the support of USAid’s East and Southern Africa trade and investment hubs.
The new partnerships will help boost regional trade integration while providing platforms that link farmers, buyers and traders to markets across the regions. EAGC and Zamace have established successful trading mechanisms and models, and with governments support, are working towards eliminating trade barriers including export taxes on grains.
Last month, Zambia lifted a 10 per cent tax on maize exports to allow it sell its surplus after production rose to 3.61 million tonnes in 2016/2017 from 2.8 million tonnes the previous period. The southern African countries are expecting a good harvest this year including a tradeable surplus.
“We shall ensure the simplification of export documents and also commit to work with all governments in the region to support regional trade and to reduce on the rules on the certificate of origin,” said Felix Mutati, Zambia’s Minister of Finance.
In East Africa, however, the region is grappling with a shortage of grains, especially maize, with Kenya bearing the brunt, following a poor harvest in 2016 resulting from erratic rains.
Zambia has already agreed to sell to Kenya 55,000 tonnes of maize with Agriculture ministers from the two countries Tuesday signing bilateral trade agreements in Nairobi. Kenya can now import maize from Zambia to bridge the deficit being experienced in the country.
Kenya is now holding talks with Tanzania to open its borders for the Zambian maize’s passage through the country to Nairobi. Tanzania imposed a ban on the export of unprocessed grains in order to control its limited stock.
READ: Plan to import Zambian maize to Kenya in limbo
At the forum in Lusaka, Gerald Masila, the EAGC Executive Director, called upon policymakers and private sector players to work together to reduce barriers to grain trade for the realisation of economic growth and increased productivity.
Yohaness Assefa, the director in charge of Agriculture and Agribusiness with the East Africa Trade and Investment Hub project, said about 1.3 million families in the region are expected to have access to affordable staple foods as a result of the trade contracts signed in Zambia.
"The forum resulted in significant regional trade by linking Zambian surplus staples with buyers from East Africa to improve the food security outlook in the EAC region,” he said.
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