Uganda to build port along Indian Ocean

By Ibrahim Kasita

TANZANIA has offered Uganda land bordering the Indian Ocean as a solution to address problems related to being land-locked, bolstering the process of East Africa Community (EAC) integration.

The land, which is next to Port Tanga situated on the northern coast of Tanzania and close to Kenyan border, will speed up transportation of goods and supplies destined for exports and imports.

“This land will link us to the sea. It is upon us to look for the money and build a port facility there because the land is available,” Eriya Kategaya, the Uganda’s first deputy premier and minister in charge of EAC affairs told Business Vision in an interview.

When the project materialises it will have answered the problems associated with relying on Kenyan route which include congestion in Port mombasa, which has been the main gateway.

The long chain of transportation makes Uganda vulnerable to any problems arising along the way, and immediately results into delays in supplies delivery causing shortages and artificial price hikes.

EAC member states – Uganda, Kenya, Tanzania, Rwanda and Burundi – are set to effect the common market begining today.

However, the market which has about 130 million people with a combined measurement of goods and services produced in the block at about $70b faces bottlenecks like dilapidated roads, railway lines, and acute energy shortage, key requirements for investments.

“The challenges are there but we are collectively working on them to ensure that we grow the regional economy as well as attract investments,” Kategaya explained.

“We are looking at increasing power generation and ensuring connectivity within the region. Kenya and Uganda have agreed to build a modern railway system as well linking the two countries.”

The premier observed that there was still a need to harmonise the taxation policies and create a common currency which will facilitate trade in the bloc.
“This is going to be important. At the moment it is really cumbersome to transact. We will try to work on a time-table that by 2012 we establish the common currency,” Kategaya pointed out.

On the Economic Partnership Agreements (EPAs), he called for the East African states to endorse the deal but “in phases.”
“EPAs will give us a sure regime of trade because at this moment we are just on good will and you cannot depend on good will. It is not good,” the premier said.
“We can agree on phased-out basis since we have time to try and catch up with our European partners.”

The EPAs are a scheme to create a free trade area between the European Union and the African, Caribbean and Pacific Group of States (ACP) countries.
They are a response to continuing criticism that the non-reciprocal and discriminating preferential trade agreements offered by the EU are incompatible with World Trade Oorganisation (WTO rules.

Kategaya argued that aid cannot develop the EAC bloc but trade and working hard. “The mentality of depending on hand-outs is not workable because there is no historical example of donations developing or transforming poor countries,” he said.
“Most countries develop from borrowing, saving and had their own programmes. But donors stipulate conditionality.”

Kategaya said the security and stability was key to improve investor confidence in the EAC block. “We need political stability for both local and foreign investors. Stability will increase investor confidence.”

He urged Uganda to specialize in agriculture, and education in order to be competitive in the region. “Modernise agriculture and process the raw materials by adding value,” he said.
“This will create high prices for the commodities as well as creating jobs.

The geo-position of Uganda is strategically located. This requires us to improve on communication, roads and transport because we are centrally-located.”