Washington — The International Monetary Fund (IMF) announced on Thursday that the Mozambican government is willing to work with the IMF on the terms of reference for an international, independent audit of the companies funded by undisclosed government-guaranteed loans in 2013-14.

Mozambican President Filipe Nyusi met with IMF managing director Christine Lagarde on Thursday in Washington, as part of his four day working visit to the United States. During the meeting, Lagarde once again called for an independent audit of the hidden loans – and Nyusi appeared to agree with her.

According to a statement issued by Gerry Rice, the IMF's Director of Communications, Lagarde “welcomed the initial steps being taken on the agreed reforms and policies”, but also “stressed the need for further policy action aimed at stabilizing the economy and for more decisive efforts to improve transparency, in particular an international and independent audit of the companies that were funded under the loans disclosed in April 2016”.

Rice added that Lagarde “welcomed that the President indicated the Government of Mozambique's willingness to work with the IMF on the terms-of-reference for this process – to be initiated by the office of the Attorney General – and to implement it”.

To work on those terms of reference, an IMF staff team will visit Maputo next week, Rice announced.

This is in line with remarks made by Nyusi last Saturday at a press conference that concluded his visit to the southern province of Gaza, where he declared that the government is not opposed to an independent, international forensic audit of the loans.

Nyusi told the reporters “at no time has any member of the government said that a forensic audit was not going to be undertaken”.

“What we have been saying is that the cases are already under way at the level of the Attorney-General's Office and of the Assembly of the Republic (the Mozambican parliament)”, he added. “So the authorities are working”.

Prosecutors have already announced that there were illegalities involved in the loans. Although they were not specific, they presumably referred to the obvious violations of the limits on government guarantees for loans set in the 2013 and 2014 budget laws.

The controversy arises over three government guaranteed loans to quasi-public companies in 2013 and 2014, the closing years of the government of Nyusi's predecessor, Armando Guebuza. Between them these loans amounted to over two billion US dollars, and added 20 per cent to the Mozambican foreign debt.

One of the loans was public – this was the 850 million dollars of bonds launched on the European bond market by the Mozambique Tuna Company (EMATUM). The main banks handling the bond issue were Credit Suisse and VTB of Russia.

But the same two banks lent large, but undisclosed sums to the companies Proindicus (622 million dollars) and Mozambique Assets Management (MAM – 535 million dollars). Proindicus was set up to provide security to offshore oil and gas operations and to other shipping in the Mozambique Channel, while MAM is to sell naval maintenance and repair services.

It is these latter two loans and their government guarantees that angered the IMF. For the loans were not disclosed, either to the Mozambican public, or to Mozambique's foreign partners. When the loans became public knowledge in April, the IMF suspended its programme with Mozambique, including the second instalment of a 283 million dollar loan from the Standby Credit Facility (SCF). Other partners followed the IMF's lead – notably all 14 donors and funding agencies that provided direct support for the Mozambican state budget suspended all further disbursements.

The IMF suspected corruption was involved in the loans. In an interview with the BBC in May Lagarde said “When we see a country and a programme with the IMF where international community money is committed, that is not respecting its financial disclosure engagement, which is clearly concealing corruption, we suspend the programme. We did that just recently with Mozambique.'

The main demand raised by the IMF, and echoed by Mozambique's other western partners, such as the United States and Britain, has been for an international, independent, forensic audit which would track down exactly what happened with all the money involved.

The IMF statement on the Nyusi-Lagarde meeting indicates that such an audit will indeed happen, at least of the Proindicus and MAM loans.

ANALYSISBy Jonathan Adengo and Eronie Kamukama

James Obuku imports goods from China for retail purposes. At the height of the depreciation of the Shilling, Obuku took out a loan at an interest rate of 28 per cent which kept on fluctuating because it was not a fixed rate loan. As such, he paid through the nose.

If Obuku attempts to borrow again today, he says he will be given credit at an interest rate of 25 per cent which is still high. With the current (Central bank rate) CBR at 14 per cent, this implies that the commercial banks will be getting a profit of 11 per cent. According to Bank of Uganda (BoU) statistics, the interest rates charged by commercial banks have averaged at 21.3 per cent since the start of the millennium and about 21.7 per cent since July 2011.

Some experts have blamed this on BoU, saying tightening the CBR – the regulators tool for macroeconomic management – amounts to further increases in the cost of credit. But its easing is not followed by a corresponding reduction in lending rates.

Kenya recently signed into law a legislation that imposes limits on bank lending and deposit rates, challenging the regulator's conduct of monetary policy in a free market environment.

Back here, Ugandan financial sector players think capping interest rates is counterproductive while the civil society and pockets of the business community are pushing for Uganda to go the Kenya way.

Before the 1990s, Uganda's economy, just like many other economies in the region, was controlled. Almost all economic indicators including prices, interest rates, exchange rates were controlled by government.

Dr Ezra Suruma, the former finance minister and Chancellor Makerere University, in an interview with Prosper magazine says back in the 70s and 80s, the interest rates were set by the Minister of Finance during the budget speech reading. This rate would then be used throughout the year until the next budget reading.

However, he says the controlled regime did not deliver much. "It is not right to say that controlled interest rates worked in the 70s and 80s because the economy that we inherited in 80s was completely broken down. There was no economy. … We had controlled rates announced by the government but we did not have an economy at that time," Dr Suruma notes.

He says everybody wanted to borrow at that time because of very high inflation. "Whatever you borrowed, you would pay back cheaper money later and could always multiply your money very quickly through trading and the opportunities for speculation."

"It would not be correct to say it worked because hardly anybody was investing. The activity going on then was trade. It will be very hard to point out any hard investment at that times based on borrowing," he says.

Dr Suruma adds: "We looked at that situation and decided that it would be better to liberalise and when we did, the rates went high because inflation was still high."

In 1993 when Dr Suruma joined the Uganda Commercial Bank (now Stanbic Bank), some loans were being given out on an interest rate of 53 per cent. This was exorbitant so the then government worked hard to bring them down to a more reasonable level mainly by bringing down inflation.

"But at some point, they seem to have become stuck; we thought that the difference between the rate of inflation and lending rate would be a few interest rate points. So if inflation was 5 per cent, one would expect the highest rate to be 10 per cent which would double the inflation rate. Normally, it should be like 8 per cent. But that never happened," he explains.

Banking sector not competitive

Dr Suruma says one of the reasons for the high interest rates was that the banking sector was not competitive. "Initially, we were not allowing new banks to come into the sector because it had become unstable. One of the reasons given for the rates being high was that the competition was not as high," he says, adding: "When there is limited competition, you may even have what they call a cartel in which major banks decide what the rates should be.

For instance in the 90's, Uganda had one large bank -Uganda Commercial Bank, which held about 47 per cent of the total deposits for the whole country. This made it a huge player in setting the market trend.

One of the reasons the World Bank pushed for the privatisation of the bank was to reduce its dominance in the financial sector.

Mr Lawrence Bategeka, a senior research fellow, says one of the assumptions of a free market is that there must be many players. However, in Uganda, "There are only 25 banks which have developed Cartel like behaviour," he says.

He says one of the things they want to look at is the extent of genuine competition in that sector. Is there really competition? Are there a few big banks coming together and determining what the rate should be rather than competition determining the basis? The ideal is what we call 'perfect' competition where you have a large number of lenders and borrowers such that the market is determined by forces of supply and demand.

Mr Fred Muhumuza, an economist and researcher, says in between control and free market is regulation. "Every time you liberalise and you don't strengthen regulation, the markets go mad because markets are self-interest driving and interests are so many in the market. Even in the banking industry, there are those that want to eat up the small ones," he says.

Mr Muhumuza says what we miss out in Uganda is the strong regulatory frame work and competition authority which should check the behaviours of the market. He says capping interest rates alone is not enough to solve the interest rate problem.

Mr George Lipimile, the chief executive officer of the COMESA Competition Commission (CCC), says a competition law is there to protect the process of competition.

"It is meant to punish large companies on account of their size and commercial success. The idea behind these laws is that in every market, there should be vigorous competition forcing firms to continually strive to improve their goods and services and to offer them on favourable terms.

However, according to Bank of Uganda experts, competition in the Ugandan banking industry has increased in the last 10 years with now 25 commercial banks, five microfinance deposit taking institutions and four credit institutions operating in the country. The market share of the three largest banks has since reduced, much of this competition takes place through expansion of branch networks – the number of bank branches has increased from 141 in 2006 to 691 today.

"By efforts to mobilise deposits by offering attractive time deposit rates, both of which raise the costs of doing business for the banks and increase rapidly if banks extend their branch networks outside of the main cities; costs which must be passed onto borrowers in form of high lending rates," Dr Thomas Bwire, an economist at Bank of Uganda (BoU) says.

Interest rate spread

Interest rate spread — the difference between the lending rate banks charge borrowers and the deposit rate offered to savers, is one way of finding out how efficient banks are. But to understand why lending rates are so high, one ought to look at the causes of high interest rate spreads.

"The largest single contributor to interest rate spreads in Uganda is bank overhead costs, which are high because of the structural features of the economy and the banking system," Dr Bwire shares.

Mr Ramathan Ggoobi, an economics lecturer from Makerere University Business School, says the central bank should exercise its regulatory powers to check the high overhead costs incurred by the commercial banks that in turn transfer the burden to the borrower through increased interest rates. He also says banks offer a saving rate of three per cent yet our inflation is almost 5 per cent, a disincentive to savers.

"When you ask the central bank to regulate, they say its policy reversal. It is good that we should liberalise but let us not deregulate like this," Mr Ggoobi says.

Mr Louis Kasekende, BoU's deputy governor also down played the possibility of BoU proposing any legislation to cap lending rates like Kenya did last week. In the 1960s, there were fixed interest rates by the central banks for different loans and saving products.

"Our assessment then is that it did not serve us well. If you look at the financial system of the 1980s, it actually contracted. We moved away from fixed interest rates to market-determined interest rates and our experience with these rates has been very good since 1993," he said. "Any move away from market-determined interest rates would be a policy reversal and you do not just give away something that has been serving you well in terms of the financial sector," Mr Kasekende said.

Comparison with the region

Kenya, which is relatively advanced economy in East Africa, has a CBR currently at 10.5 per cent, the maximum interest rate stands at 14.5 per cent.

Other free markets globally have strong regulations to restrain banks as such guarding against increase in interest rates. Free markets, from the United States to Britain to China, sometimes need the steady restraining hand of regulation on the hand brake.

Pretoria — The annual Consumer Price Index (CPI) eased to 5.9% in August 2016, Statistics South Africa (Stats SA) announced on Wednesday.

"Headline inflation decreased to 5.9% for August 2016. That is 0.1% down on the 6% recorded in July," said Joe de Beer Deputy Director General at Stats SA.

Contributors to the annual change of 5.9% in CPI were food and non-alcoholic beverages at 1.7%, housing and utilities at 1.4% and miscellaneous goods and services at 1.1%, among others.

Food and non-alcoholic beverages contributed to the monthly change of 0.1% as did transport recording a -0.3%.

"When looking at food month-on-month we saw that vegetables and meat declined in terms of their prices but there were increases in oils and fats, bread and cereals as well as sugar, sweets and desserts," noted de Beer.

The decrease in headline inflation was in line with market expectation including that of Nedbank economists.

"We expect inflation to increase to marginally above 6% in the next few months as earlier rand weakness works itself through the numbers. Consumer inflation is expected to end the year at 6% and average 6.2% in 2016 as a whole," said Nedbank economists.

Going into 2017, the bank expects consumer prices to soften going into 2017 as food prices cool somewhat on the back of a good winter crop season and the possibility of a La Nina weather pattern which is forecast to bring normal rainfall levels in 2017.

"The biggest threat to the inflation outlook is still the currency and a weak rand will limit the decrease in prices in 2017," noted the economists.

Nedbank said the softer inflation profile and the recent strengthening of the rand gives the Reserve Bank room to leave rates temporarily unchanged.

"The big concern for the central bank still remains the rand. We believe that the current strength in the currency is temporary and that the rand will weaken as the year progresses. We believe that the Reserve Bank will take a wait and see approach tomorrow when they announce their rate decision, but we are not completely ruling out a 25 basis point rate hike early in the new year," said the economists.

The central bank's Monetary Policy Committee (MPC) will announce its decision with regards to the repo rate tomorrow afternoon.

CPI basket and weight

Meanwhile, Stats SA announced on Wednesday that it will make changes to the CPI basket of goods and services and the weights attached to these. This would take effect from the January 2017 release of CPI.

It is international practice that reweighing takes place at least every five years to ensure relevance to the changing consumption trends.

South Africa's last reweighing exercise was in January 2013.

The basket of products whose prices in which inflation figures are calculated is based on the spending of South African households over a particular year with the primary source of this data being Living Conditions Survey (LCS).

By Sifa Lubasi

Dodoma — Aircrafts landing daily at Dodoma Airport have tripled to nine from the normal three following completion of expansion works on the runway, Airport Manager Mr Julius Mlungwa has said.

He said the completion of the works early this month has allowed more flights to land at the semi-arid region and the country's designated capital, lowering airfare to passengers. "The airport expansion works are complete by 100 percent.

We are now finalising putting mark-points," he said. Mr Mlungwa said, for long, air travelers, including tour agents, businesspeople, government officers, leaders, international organisation representatives and ordinary people, had been complaining about escalating airfares to and from Dodoma.

"We had only two flights, Auric Air and Flight Link. They were both 13-seaters and fare stood at 495,000/- for single ticket from Dar es Salaam to Dodoma.

It was not easy for an ordinary person to use air transport," he said. Tanzania Airport Authority (TAA) Engineer Mbila Mdemu who was in charge of the expansion project said the last renovation works at Dodoma Airport was done in 1976.

He said there was a feasibility study conducted in 2005 to expand the runway but the expansion were not undertaken due to limited financial resources. "President John Magufuli ordered expansion of the runway with other related services before August.

We have managed to complete all the requirement," he told reporters here yesterday. Dodoma Assistant Apron, Mr Emmanuel Kisumo admitted that despite additional numbers, now the airport is accommodating up to 90-seaters aircrafts.

The new expansion work involved 2.5 kilometre runway and a 500m lighting area for airplane safety during takeoff and landing.

By Mwiti Marete

The Meru Government is set to brand its own coffee to increase earnings from the cash crop.

Mr Ntoitha M'Mithiaru, the cooperative, trade and tourism executive said the county is one of the best producers of quality coffee in the world and developing a brand would earn farmers more income.

"Farmers came together in 2014 and formed Meru County Coffee Millers Union. Through the union they have been able to get better prices from sales. The lowest (amount) farmers have been paid is Sh60 per kilo and highest is Sh130," he said.

He said the payment to the farmers depends on the international markets but will change with value addition.

He said cartels were swindling farmers but they have now been sensitised through seminars organised by the county government.

Challenges that farmers faced, including access to fertilizer and seedlings, have also been addressed.

"We have made it easier for farmers to get fertilizer by granting them loans as well as carrying out research on different types of soils in the county to identify the best seedlings for different areas," he said.

By Brian Ngugi

President Uhuru Kenyatta has maintained silence on when he will appoint a new Central Bank of Kenya (CBK) board, nearly one-and-a-half years since terms of five members expired.

Mid-April, the Treasury said it had finalised picking nominees and expected them to be appointed "soon".

The President appointed lawyer Mohamed Nyaoga in June last year to chair the new and more powerful board, but is yet to pick five members, with no explanation on the delay. Changes introduced in 2012 created a two-tier board to check the governor's influence on the economy.

New rate regime

Yesterday, State officials were mum on the process that is crucial as the board oversees performance of the bank's executive as it implements the new rate capping regime.

Spokesperson for the Presidency Manoah Esipisu did not pick our calls nor return messages sent to his phone. Neither did National Treasury Secretary Henry Rotich and the deputy State House chief of staff and head of Public Service Nzioka Waita.

Following the long delay, focus has turned to the implication of the lack of the crucial policy making board, especially at a time Kenya's financial sector is in the grip of massive changes.

"I am sure the Central Bank itself would like to lift this shadow — It is self-evidently not optimal," said Rich Management CEO Aly Khan Satchu.Mr Rotich had said in April that the names would be forwarded to the President for appointment, ahead of approval by Parliament.

"We have finalised on the names on the board members. They will be appointed by the President and then approved by Parliament. We expect this to happen very soon," said Mr Rotich.

The lack of a board of directors at the CBK initially became a major point of focus, following a crisis of confidence in the country after the fall of Chase, Imperial and Dubai banks and suspension of six managers at the National Bank of Kenya.

Such a board would be expected to have a committee specialising in matters relating to ensuring the stability of the financial sector as a whole.The team is supposed to set CBK's policies, review performance of the governor and provide oversight over the regulator's strategy and financial management.

Discuss performance

Under the CBK Act, the board is supposed to meet not less than once every two months to discuss the regulator's performance, check decisions made by management and consider capital investments.

The hole in the board has been seen to stall a fully constituted panel to execute its role. Under the Central Bank of Kenya Act (Cap. 491), the responsibility of determining the policy of the bank, other than the formulation of monetary policy, is given to the board of directors.

The CS had, however, said earlier that the absence of a board did not mean that the financial sector was under threat since the governor was charged with ensuring risks are minimised.

The financial problems currently besieging state-owned Botswana Meat Commission (BMC) can be as easy as privatising it, declares Chief Executive Officer (CEO), Dr Akolang Tombale. "Privatise BMC and let it compete," said Dr Tombale when appearing before the Parliamentary statutory body. Tombale said part of the problems leading to the company's poor performance is that they are operating on social welfare basis, resulting with loss making operations in Francistown and Maun abattoirs.

Francistown plant though the newest plant of the three has not performed well, failing to even reach least 85% of its capacity utilisation since its commissioning. It has long been de-listed from the European Union market and was only re-listed in August 2016. Though re-listed again Francistown, according to the BMC report, has lost Zone 4 (a) which is Boteti area. Though Lobatse plant is doing well it is very old and possibly dilapidated and requires modernisation and alignment to the greater objectives of BMC strategic plan, said Tombale. "As part of restructuring and modernising BMC we will need P2 billion and have not asked government for assistance for now," said Tombale after being questioned if they have submitted their proposal to government.

According to its 2014 Audited Financial Report, BMC has a total deficit for the year of P9 million (2013; a surplus of P26 million and P28 million respectively). The total liabilities of the group and commission exceed the total assets by P109 and P248 million respectively. Chairperson of the Parliamentary statutory Body, Samson Moyo Guma labelled BMC as bankrupt.

Uíge — The chairman of Confederation of Farmer Associations and Agricultural Cooperatives of Angola (UNACA), Albano da Silva Lussati, is working from Monday in the northern Uíge province to assess the functioning of the sector in the region.

After his arrival in Uige Province, Albano da Silva Lussati met with members of the local Association and the acting provincial governor, Afonso Luviluko.

Speaking to the press, UNACA chairperson said that the visit aims to inform on the strategic development plan of the associations with the local government.

He noted that the three-day visit to Uíge will also strengthen the survey, training of staff of UNACA and re-launch of associations and cooperatives.

The visiting agenda includes meetings with members, visit to the associations and cooperatives based in Puri Municipality.

By Carlos Lopes – The Executive Secretary's Blog

As the world gets used to new forms of interconnectedness, Africa is not left aside. Today, more than 700 million Africans are subscribed to mobile services with many wealthy Africans proudly displaying more than one cell, a symbol of a newly acquired social status. The proliferation of mobile networks has transformed communications, businesses or banking, enabling a jump unimaginable just a few years ago. Thanks to technology we are witnessing new forms of integration.

Is aviation going to be the next big integration magnet?

Unfortunately, even though Africa is home to 15% of the world's population it only accounts for a relatively small proportion of air traffic, in fact less than 3% of the world's total.  Small as this may be, the African aviation market is growing fast.

International air passenger numbers have grown consistently year on year since 2004 except in 2011 where the numbers dipped as a result of political instability in parts of North Africa. From less than 40 million passengers carried in 2004 by African airlines, passenger numbers increased to 73.8 million in 2013. Domestic passenger numbers within the region also increased significantly reaching 28 million in 2013[1]. This growth is projected to continue. Boeing’s long term forecast for 2014-2033 indicates that, driven by a positive economic outlook, increasing trade links, and the growing middle class, traffic to, from, and within Africa is projected to grow by about 6 percent per year for the next two decades. This demand will translate into a demand for an additional 1,170 new airplanes, valued at USD 160 billion[2]. But as with all good things the proof of the pudding is in the eating.

According to the Air Transport Action Group[3], in 2014 the aviation industry in Africa supported 6.8 million jobs and contributed USD 72.5 billion to Africa's GDP. This accounted for 11% of the jobs and 3% of the GDP supported by the air transport industry worldwide.

These encouraging developments however do not reveal some of the major obstacles still faced by the aviation industry in the continent. It remains one of the most unsafe regions to fly, it has lagged behind others on skies liberalization, its airport infrastructure continues to require massive investments and the training of skilled personnel is not being properly planned.

African airlines consolidation is another challenge. During the 1970s and 1980s there were about 36 African airlines of which 26 had intercontinental flight services. Today there are only about 12 African airlines with intercontinental operations.  Over the last two decades a total of 37 new airlines were launched in Africa but almost all of them failed.  Most countries continues to act solo and motivated by choices other than economic. We continue to see attempts to create or sustain national carriers, opposing international trends. It is true that Middle East carriers and the good performance of Ethiopian Airlines contradict the doomsayers of state-owned airlines, but these are exceptions that need to be understood in their plenitude. 80% of the continent's long haul traffic is dominated by non-African carriers.

The average cost of a flight in Africa is higher than anywhere else in the world.  High landing fees, exorbitant taxes levied on airfares as well as above average aviation fuel prices, almost 30% higher than in Europe, do not help.

Funding access for the aviation industry is uneven. Dubai, Abu Dhabi and Qatar-based airlines have reportedly enjoyed a host of benefits valued at more than USD 42 billion over the past decade. That includes subsidized access to capital and sponsored first class infrastructure. American commercial aviation has also benefited from its government's support valued at USD 155 billion, since 1918. Obviously African airlines are not in the same league and have been left to fend for themselves. Without the same easy access to capital markets, export credit financing (which can cover up to 85% of the actual aircraft price), or insurance subsidies, African airlines either have to finance the difference from their own funds or opt for junior loans with punitive rates from commercial banks; or lease aircrafts at an even heavier cost. The financing options open to African carriers dwarf their chances for expansion. It is therefore hardly surprising mega carriers are doing so well, including in their operations in Africa. They have the advantage to expand quickly, with space to build a market from scratch, increase market shares and continue investing heavily in service and marketing.

Intra –African connectivity is so mediocre that any passengers have to travel thousands of miles out of the continent just to be able to make a connection to another African destination. A quarter of the intra-African routes are actually served by just one airline. Despite African states signing up for a full liberalization of the regional market at Yamoussoukro in 1999, restrictions and protectionism instead of being eliminated are becoming rather rampant.

What could constitute a good base for a turnaround? With regards to safety accidents 2014 marked a significant change. Despite aviation disasters dominating headlines that year, African airlines actually stood out for zero jet hull losses (write-offs) per 1-million flights compared to 2.22 in 2013 and 4.63 in 2012[4]. This is encouraging news, suggesting regional measures to improve safety records are working. Ethiopian Airlines is already leading the way amongst its continental competitors in terms of establishing ambitious targets meet them and turn a profit. With 93 destinations across 5 continents, including 53 in Africa its future looks promising. Having experienced a phenomenal 700% growth in its revenue since 2005, Ethiopian Airlines has demonstrated the strength to face difficult competition. However, as long as Africa fails to establish a single aviation market and countries continue to restrict African carriers while welcoming the European and Middle East competitors, the performance of Ethiopian Airlines may remain an exception.

Africa must move towards embracing a conducive and smart regulatory framework that liberalises its skies in order to realise a profitable and globally competent airline industry. A truly competitive sector will need to be innovative and prioritise the continent's interests over national flags. An open skies policy would drive the cost of tickets down and increase substantially the number of flyers.  According to IATA by just deregulating and liberating African air services in 12 key markets, an extra 155,000 jobs and USD 1.3 billion could be generated[5].

Evidence shows that open skies agreements have worked in other regions. For example in Europe, it increased exponentially the number of routes and provoked a 34% decline in ticket fares. Indeed where African nations have liberalised their air markets, either within Africa or with the rest of the world, positive benefits have resulted. For example the agreement of a more liberal air market between South Africa and Kenya in the early 2000s led to a 69% rise in passenger traffic. The 2006 Morocco-EU open skies agreement led to 160% rise in traffic with the number of routes operating between the two multiplying four fold[6]. Just allowing the operation of a low cost carrier service between South Africa and Zambia (Johannesburg-Lusaka) resulted in a 38% reduction in fares and 38% increase in passenger traffic. The continent has to create more space for low cost flying.  As of 2013 the penetration of low-cost airlines in Africa was the lowest in the world, representing less than 10% of the continent's total.

In an interconnected world, air travel is no longer a luxury, it is a necessity for a prosperous continent.

Published as an op-ed in the East African on 12 September 2016

[1] Chingosho, E. (2014). 46th AFRAA Annual General Assembly. Report of the Secretary General. 10 November 2014, Algiers, Algeria

[2] Boeing Commercial Airplanes (2015). Current market outlook

[3] Air Transport Action Group (2016), Aviation: Benefits Beyond Borders  report

[4] http://mg.co.za/article/2015-03-11-think-african-jets-are-flying-coffins-these-numbers-will-prove-you-wrong

[5] IATA (2014), Press release on the Significant Benefits of Liberalized African Air Marketshttp://www.iata.org/pressroom/pr/Pages/2014-07-07-01.aspx

[6] InterVISTAS Consulting ltd (2014).Transforming Intra-African Air Connectivity: The Economic Benefits of Implementing the Yamoussoukro Decision. Prepared for IATA in partnership with AFCAC and AFRAA

President Museveni has asked ambassadors, in France, to market Africa to Europe. "Africa's purchasing power is now at $8 trillion with a population of 1.2 billion.

Remind Europeans that Africa is a growing market and they should, therefore, take interest in it," Mr Museveni said.

The president made these remarks at the start of a two-day visit to France, on which he has been accompanied by Education minister, Janet Museveni, also his wife.

The two were received by French ambassador to Uganda, Ms Sophie Makame, Uganda's Minister of State for International Affairs, Mr Okello Oryem and Uganda's Ambassador to France, Ms. Nimisha Madhvani. A host of other African ambassadors accredited to France representing Kenya, Ghana, Sudan, Ivory Coast, Rwanda, Ethiopia, Zambia, Zimbabwe, Algeria, the Central African Republic, Gambia, Tanzania, Niger and Togo, among others were present when Mr Museveni touched down at Le Bourget Airport.

Museveni also told the ambassadors that East Africa is discussing a policy "where investors would only sell their products if they are manufacturing in the region".

"… .If you don't manufacture here, then you don't sell here. Ethiopia is already doing it," the statement quotes Mr Museveni as saying.

The president is in France for a two-day working visit meant to foster trade and investments between the two countries.

Later today, President Museveni is expected to address the Movement of the Enterprises of France (MEDEF), the largest employer federation in France with a membership of over 880,000 firms.

He will later hold bilateral talks with the French President Francois Hollande at his official residence, the Elysee Palace.

Meanwhile, the Minister for Education and Sports, Janet Museveni, will meet officials of Campus France, the public agency overseen by the French Ministries of Foreign Affairs and Higher Education, responsible for coordinating services for international students in France.