Speech by the Danish ambassador Mogens Pedersen on the TradMark workshop

on February 9th in Kampala

Ladies and gentlemen, friends and partners of TradeMark East Africa.

Let me take this opportunity to welcome you all to this important workshop.

As the Danish Embassy, we very much support regional trade and economic integration in East Africa. We consider regional trade as an important engine of sustainable economic growth.

As you are aware, Uganda is vital to the further integration and economic development of the EAC. Uganda significantly contributes to the increase in intra-EAC trade. Given its strategic regional position it is a vital node for the region’s trade with South Sudan, Rwanda and DRC.

Since 2010, Uganda’s annual economic growth rate has averaged 5.4% with an important impact on poverty. The very high population growth leads to a modest per capita growth.

However, Uganda continues to face serious challenges including high poverty levels; a high and increasing trade deficit; high transport costs due to poor infrastructure;and low value addition to its agriculture exports.

In light of this, Danida is engaging especially the private sector to support growth and employment in Uganda through the U-Growth II programme. This programme seeks to address issues affecting the Agricultural sector, rural transport infrastructure and agribusiness. In particular we are supporting the small and medium size sector of the economy, first and foremost related to transformation and processing of agricultural products, where you can generate income and significant employment with direct impact on poverty levels. Indeed, the SME-sector is the missing link in many African economies, including Uganda.

Competition is central to the operation of markets, and fosters innovation, productivity and growth, all of which create wealth and reduce poverty.However, markets do not always work well, and uncompetitive markets are often those that matter most for the poor.

To promote private sector development and competitiveness it is crucial to improve the business environment. According to a recent World Bank publication Uganda still lacks behind and faces important challenges to improve the business environment. Among the main challenges is the widespread corruption which constitutes without doubt the main impediment for private sector development. This is in particular the case when it comes to public procurement and also operations related to import and export. Another major challenge is the strong politization of the private sector where political relations seem more important than the capacity as a private company. Also the politization of private sector organizations is a challenge.

To accelerate growth, it is important among other things to reduce barriers for trade. There is a need to support the private sector to grow and flourish so that the benefits of reduced trade barriers are maximized by an increased trading response from the private sector.

Danida is glad to partner with TradeMark East Africa in increasing trade in the region by creating the necessary conditions for the private sector to improve business competitiveness through:

  • Boosting private sector led advocacy
  • Improving export capability
  • More efficient utilization of logistics
  • Greater inclusion of women and small businesses

Specifically, we support TMEA with implementation of the Electronic Single Window that will enable connectivity and seamless review and approval of international trade documents by key agencies involved in trade clearance. These agencies include Uganda Revenue Authority, Uganda Export Promotions Board, Uganda National Bureau of Standards, the Private Sector Foundation and many others.

As Private Sector and Civil Society Organisations, you have a key role to play in contributing to policy dialogue, providing information and monitoring policymaking and programmes for regional integration.However, many of your organizations can benefit from improved institutional and technical capacitiesin order to better engage on regional integration and trade issues. We are glad to partner with TMEA tosupport initiatives to strengthen your internal systems for grant implementation and project management.

Strong internal systems ensure sustainability and increase visibility of organisations. In addition, you are able to effectively represent your members’ interestsfor them to benefit from further regional integration.We hope that you adopt and utilise the manuals that you will get today.

A big thank you to you, our partners, for your participation. The above successes were possible with the commitment you all showed. A big thank you to Trademark East Africa for coordinating today’s event. We look forward to our continued close cooperation.

It is now my pleasure to hand over the manuals to the organisations that have successfully completed the capacity building programme.

In attendance:

  • Directors TradeMark East Africa
  • Private Sector Foundation Uganda
  • Southern and Eastern African Trade, Information and Negotiations Institute
  • The Grain Council Uganda
  • Uganda Clearing Industry and Forwarding Association
  • Uganda Freight Forwarders Association
  • Uganda Shippers Council
  • Uganda Tourism Association
  • Uganda Tourism Board
  • Uganda Women Entrepreneurs Association Limited
  • The Media

BRIEF ON DENMARK’s SUPPORT TO TMEA-U

TMEA – Donor vehicle for support to EAC integration

  • Danida supports TMEA Uganda programme strategic work plan 2012 – 2016 under component 2: Enabling Environment of the U- Growth II programme with the objective to promote increased private sector-led and export-driven economic growth.
  • This component consists of support to TradeMark East Africa- Uganda Programme (TMEA-U)
  • The immediate objectives of TMEA-U are:

(1)Reducing transport and trade-related costs along the northern transport corridor, with specific focus on strategic border posts in Uganda;

(2)Supporting Uganda to substantially increase the implementation of its regional integration commitments, including building capacity for key agencies mandated to implement regional integration decisions;

(3)Supporting the private sector and civil society to positively influence regional integration policies and practices for growth in trade.

  • TMEA-U requested funds from Denmark to make possible a full implementation of the national Electronic Single Window (ESW), for which only a limited implementation was foreseen then in the TMEA-U work programme. The 2012-16 work plan and budget was therefore revised to include the ESW. However, even if the ESW constitutes the justification for the Danish support, the Danish funding was meant to be for a general, non-earmarked co-financing of the whole work plan together with the other donors (UK, Sweden and Netherlands). The budget for the Danish support to the 2012-2016 work plan is 27 million DKK, which should make it possible to fully implement the ESW and pilot it in some institutions.
  • It is furthermore planned to co-finance the second phase of TMEA-U with 18 million DKK for 2017-2018, thus bringing the total commitment of funds to 45 million DKK for the period 2014-2018.
  • The Electronic single window will initially be piloted on 7 organisations including:- Uganda Revenue Authority, Uganda Export Promotions Board, Uganda National Bureau of Standards, National Drugs Authority, Ministry of Agriculture, Animal Industry and Fisheries, Ministry of Trade, Industry and Cooperatives and the Private Sector through the Private Sector Foundation of Uganda
  • UNCTAD was awarded the contract to establish a National Single Window in Uganda and have already set up an office at Uganda Revenue Authority – the institution selected to house the Electronic Single Window.
  • In the second phase, Denmark’s funding will be non-earmarked and together with the support from other DP’s enable TMEA-U to implement its work plans, including additional implementation of the Electronic Single Window. Of special interest is also support to women and informal traders in terms of capacity building on issues or regional integration, access to markets and eventually contribute to widening the tax base in Uganda.

BRIEF ON TRADEMARK EAST ARFRICA’S PROJECTS:

EXISTING PROJECTS:

  1. Southern and Eastern African Trade, Information and Negotiations Institute (SEATINI)- Upgrading quality standards in maize and sesame project: $300,000 project focused on raising awareness around EAC harmonised maize standards, initiating policy and practice changes and enhancing enforcement to standards. Work is done in partnership with other key stakeholders like USAID Feed The Future, UNBS and local governments. Good progress including:
  • Farmers in project districts (Nakaseke, Lira and Masindi) reporting improved quality and increased prices from 400/= to 1000/= attributed to improved standards of maize.
  • Enactment of policies on strengthening implementation of standards (Maize ordinance developed and adopted by Ministry of Local Government).
  • Development of the sesame standard with UNBS, standard now pending approval from World Trade Organisation.
  1. Uganda Shippers Council (USC) - Reducing cargo costs for importing and exporting for Ugandan shippers: A $130,000 project that seeks to reduce auxiliary costs for Ugandan shippers and an alternative route to the sea via Lake Victoria.

NEW PROJECTS

  1. Uganda Women Enterprise Association Limited (UWEAL) - Women in trade project: $500,000 project that seeks to enhance women traders’ understanding of EAC trade procedures and to enable them address key challenges that impact on trade. Key components include: analyse the impact of the CET on women’s tradable goods with specific attention to Women Urban Traders (WUT) and Women Light Processors (WLP); organizing the traders and building their capacity to better understand the EAC import and export regulations, Identify and report NTBs that adversely impact Women Traders/ processors; negotiate for and obtain lower export-related services (standards certification, freight, warehousing); and organise into sector based cooperatives to engage with MDAs.
  2. Uganda Tourism export capability project: $370,000 project to support market research, development of new tourism products and joint marketing with Kenya and Rwanda.
  3. The Grain Council Uganda - Staples export capability project: $450,000 grant to The Grain Council of Uganda to strengthen grain warehousing, storage standards and capacity through 6 farmer centred hubs.
  4. Private Sector Foundation Uganda (PSFU) - Building Capacity to support Private Sector led policy advocacy for regional integration: $230,000 project to reduce regional trade barriers faced by the business community.
  5. National Logistics Platform - Enhancing Uganda’s logistics performance by facilitating and accelerating critical reforms in the logistics sector: $230,000 project that seeks to reduce key obstacles affecting logistics services.