Firms urge govts to remove NTBs

Thursday December 12 2019

Border

The bloc’s private sector players and representatives met in Arusha last week, to discuss critical issues such as border closures, and other non-tariff barriers. PHOTO | FILE 

MOSES K. GAHIGI
By MOSES K. GAHIGI
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Members of the East African Business Council are pushing for regional governments to come up with measures to address the high cost of production such as the high-energy tariffs, logistical bottlenecks and access to affordable finance.

The three biggest economies in the region — Kenya, Uganda and Tanzania — have a combined peak electricity demand of about 3,300MW, which is way below the installed capacity of 5,500MW.

The bloc’s private sector players and representatives met in Arusha last week, to discuss ritical issues such as border closures, and other non-tariff barriers, as well as unfriendly tax policies which still impede trade flows even as the bloc commemorates 20 years.

“Partner states need to fast track tax harmonisation by using a number of measures such as establishing an initiative to address tax-related issues.

The region should also support development and upgrading of regional value chains, specifically supporting the private sector who are already established in the region as well as attract new investments,” read part of the EABC statement.

During the meeting, the region’s business leaders also called for the relevant authorities to speed up the process of adding the Democratic Republic of Congo to the East African bloc after it formerly applied to be a member early this year.

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The private sector pledged to double intra regional trade from 12 per cent to 24 per cent in five years, but this will only be possible if a political solution is devised to address the current stalemates between partner states.

They pointed out that for the region to grow economically, there has to first be “diversification in production, opening up borders, promotion of regional value chains and development of regional local content policy.

“There have been some gains in the past 20 years, for instance, the establishment of a Customs Union and implementing the Common Market and Monetary Union.

With the help of partners like Trade Mark East Africa, the World Bank and others, the regional countries managed to construct and operationalise up to 13 One-Stop Border Posts (OSBP), which significantly reduced non-tariff barriers.

Although a lot of work remains to be done on an agreed on common external tariff, the process has been started, but in the meantime, regional countries have come up with a simplified certificate of origin and cargo processing regime. Infrastructural development and improvement and adoption of a number of sector policies, have resulted in increased trade volumes.

Despite the current disintegration in relations, Rwanda, Uganda and Kenya were in a coalition a few years ago, with the three member states implementing multiple development projects under the Northern Corridor.

However, many of these have since collapsed, and the border between Rwanda and Uganda closed after relations between the two countries escalated.

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