New Kagame-Samia trade pact to spark economic boost in EAC bloc

NAIROBI, Kenya - A new trade pact has been reached by Tanzania and Rwanda that could boost the economic growth of not only the two countries but also the East African regional bloc.

This pact was signed this week and it seeks to pursue a new partnership based on developing more innovative, ICT-based trade and business services for mutual benefit.

Rwandan President Paul Kagame was in Dar es Salaam this week with his delegation for a two-day working visit.

President Kagame held a private meeting with Tanzania’s President Samia Suluhu Hassan.

"Africa's entrepreneurial youth give us a comparative advantage, but we have to create an enabling environment for them and that's why we are here," Kagame said.

Samia said their talks were centered on how to improve other communication and connectivity channels for the purposes of facilitating more commercial efficiency between Tanzania and Rwanda and elsewhere.

“Some of the trade ideas we discussed would need further collaboration from both sides in order to be brought to fruition,” she added.

The Tanzanian head of state also directed the two countries' Joint Permanent Commission and a joint implementation committee to meet in Tanzania ‘quickly’ and, together, work out all the nitty-gritty technical details before they can proceed to the signing of binding agreements.

As per Samia, trade between the two countries has not reached the level that fully reflects the resources that each country has or the relationship they enjoy, and could therefore be boosted by further infrastructural expansion.

The official data show that Tanzania's exports to Rwanda increased steadily in value from $60.1 million in 2017 to $277.8 million in 2021 while imports from Rwanda rose at a slower pace from $1.3 million to $2.2 million during the same period.

Rwanda uses the port of Dar es Salaam for over 80 percent of its inbound and outbound cargo through the central corridor while some of its submarine sea cables’ IT infrastructure also currently passes through the same port.

Tanzania Ports Authority statistics reveal that Rwandan transit cargo volumes through the port of Dares Salaam went up from 1.06 million tonnes to 1.366 million tonnes between 2017 and 2021. President Samia said expansion work currently in progress at both the Dar es Salaam and Tanga ports will help increase overall capacity to handle more Rwandan cargo.

She said they had also discussed progress in the Rusumo Falls hydropower project and the two leaders agreed to attend the upcoming launch together.

The project, which will provide 80MW of electricity to be shared equally between Rwanda, Tanzania, and Burundi, is reportedly 98.3 percent complete and has been reset for official launch in June this year after several delays.

GAROWE ONLINE