MARKUP sets out to support East African SMEs

Agribusinesses in the East African Community (EAC) are to benefit from more substantial business opportunities in both East African and European markets – in light of a new initiative funded by the European Union.

The proposed Market Access Upgrade Program (MARKUP) was recently unveiled in Arusha, Tanzania, and it assists small and medium-enterprises (SMEs) across the region to improve access to EU markets and foster interregional transactions. MARKUP is out to support East African SMEs that are specialised in a variety of sectors, including coffee, horticulture, avocado, spices, and tea. The emerging interventions will focus on identifying and eliminating trade barriers, improve competitiveness, strengthen value addition for selected priority sectors, ensure compliance with international regulations and provide seamless access to trade finance ventures. The initiative will also provide access to trade finance ventures and support the identification of opportunities for trade and foreign direct investments.

The € 35 Mill. MARKUP initiative is funded by the EU as part of the 11th European Development Fund. The program is set to be implemented over a period of four years under general supervision from the EAC Secretariat. Two of the most well-meaning technical implementation partners are the International Trade Centre (ITC) and Deutsche Gesellschaft Zusammenarbeit (GIZ).

According to a press release on Newsghana.com.gh, announcing the launch of MARKUP, the Head of Cooperation at the EU Delegation in Tanzania, Mr. Jose Correia Nunes, said, “This program supports EAC efforts to improve the regional trade enabling environment as well as enterprise export competitiveness for a number of products with high growth potential, implying existing supply gaps particularly in Europe, a sufficiently high degree of readiness and sector organisation in order to meet strict quality and quantity requirements and the possibility to tap into higher – than now – price segments”.

The Executive Director of ITC, Arancha Gonzalez also noted that, “MARKUP aligns closely with the regional integration priorities of the East Africa Community. It aims to build the competitiveness of MSMEs across the region, and support them to increase production, take advantage of the market – access opportunities and create more value addition.”

He added that, “There is an always-on-the-increase demand in the EU for the products produced in the EAC. MARKUP will capitalise on this nature and use it to create sustainable market Europe and EAC linkage, while further contributing to the creation of jobs and inclusive development in the region.”

The GIZ Country Director, Ernst Hustaedt noted that, “the MARKUP project complements the longstanding support of the German Government to the East African integration process. In times where interregional free trade is questioned, and voices of protectionism can be heard louder than before, we are especially proud that the European Union has entrusted us with this initiative. We will work closely with the EAC Secretariat and the member Partner States to support the implementation of the Customs Union and the Common Market Protocol to improve the preconditions for trade and value addition in the region.”

Availing the advantage of growing global demand for coffee, horticultural products, avocado, spices, and tea – selected SMEs will undergo training on how to adapt their agribusiness models to take better advantage of the present and future opportunities, which will abound as a result of the increased trade. Also, central to MARKUP will be the improvement of the compliance of SMEs with international quality and standards requirements. By improving awareness and transparency in the relationship with sanitary and phytosanitary measures, as well as on trade technical barriers, the initiative will enable participating SMEs to gain product certification – which will ease their efforts to enter foreign markets.

The MARKUP program has an estimated sum cost € 40 Mill, including the € 35 Mill. contribution from the EU and indicative third-party contributions of about € 5 Mill – and will be put into use from this year (2018), until 2022. The program aims at looking into both the supply side and market access constraints of some critical export-oriented sectors, namely agro-industrial crops and horticulture, supporting participation in regional and global value chains – with a specific focus on exports to the European Union.

The program is structured around two intervention levels: the EAC-Window and the Partner States Window. The EAC-Window will support EAC efforts to improve the regional trade and business-enabling environment for the selected commodities. It will also assist the private sector in enhancing its export competitiveness. The Partner States Window involves national interventions tailored to EAC countries’ specific needs and complementing the EAC-Window where any single country needs it the most.

The International Trade Centre is the joint agency of the World Trade Organisation and the United Nations. ITC assists small and medium-sized enterprises in developing and transition economies to become more competitive in global markets, thereby contributing to sustainable economic development within the frameworks of the Aid-for-Trade agenda and the United Nations’ Sustainable Development Goals (SDGs).

Source: African Strategic-Ventures (ASV) & Wee-tracker