MEASURES

Addressing tariff and non-tariff barriers will revitalize EAC trade

A raft of policy measures have been considered and implemented with a view to boost trade

In Summary
  • The commitment by the JCC to abolish up to 64 tariff and non-tariff barriers affecting trade relations between the two EAC states is welcome.
  • The effort to resolve or otherwise abolish impediments to trade amongst the states will target trade bottlenecks such a customs clearance.

The Joint Commission on Cooperation (JCC), a bilateral institution comprising of the Governments of Kenya and Tanzania looking at enhancing cooperation between the two states on areas of mutual interest, recently resolved to abolish non-tariff barriers preventing cross-border trade between the two East Africa Community (EAC) member states by December 2021.

The commitment by the JCC to abolish up to 64 tariff and non-tariff barriers affecting trade relations between the two EAC states is indeed welcome, particularly given the states’ strenuous relationship in recent past.

The effort to resolve or otherwise abolish impediments to trade amongst the states will target trade bottlenecks such a customs clearance and processing, inspection of standardised products, and telecommunication inefficiencies.

As discussed previously in this column, a number of challenges have through the years presented themselves as curtailing EAC from achieving her trade potentials. These include misguided protectionist domestic trade policies that seek to protect domestic industries from perceived competitive threats, tariff and non-tariff barriers and increased threats of double taxation.

The above considered, a raft of policy measures have been considered and implemented with a view to revitalise intra-EAC trade. These include a focus on the improvement and modernisation of infrastructure linkages, the removal of non-tariff barriers and the prevention of double taxation.

Key to the achievement of a fully integrated EAC region in the free movement of people within the region. This will not only enable skills transfer within the region, together with industrial efficiencies and technical know-how, but also cement intra-EAC collaboration into the core of the region. This is boosted by the efforts to ensure that robust infrastructure linkages are available to enable the seamless movement of people, goods and services within the region.

It is similarly expected that existing non-tariff barriers (NTBs) will be conclusively addressed in the ongoing integration efforts. The existence of NTBs carry the consequence of curtailing integration efforts by seeking to protect domestic industries from perceived unfair external competitive forces. This is at the expense of regional growth and development, thereby working against the EAC’s commitment to regional integration.

It is positive, however, that the EAC Heads of State have reaffirmed their commitment to an integrated EAC region and directed their respective ministries to spare no expense in ensuring that the integration efforts continue seamlessly. This includes efforts to ensure that effective mechanisms are in place to support the efficient movement of cargo across regional borders, the streamlining of customs border checks and processes and ultimately recognition of our joint commitment to an integrated EAC region.

The renewed commitment to an integrated EAC, with the Tanzanian administration back at the table, will serve to incentivise intra-EAC trade and hopefully cement the EAC region as the fastest growing region within the African continent.