BILATERAL TRADE

Kenyan officials to confirm origin of Uganda sugar exports

Uganda’s Trade ministry figures show that the country has 11 sugar mills producing 510,000 tonnes

In Summary
  • Last year, Kenya’s trade officials declined to allow a section of Ugandan products into the country over concerns that the goods did not meet the rules of origin.
  • Uganda’s President Yoweri Museveni last Tuesday met with a delegation from Kenya led by Trade CS Betty Maina  to discuss the verification of the sugar sector.
Sugar stock at a warehouse in Muhoroni Sugar Company
LOW PRODUCTION: Sugar stock at a warehouse in Muhoroni Sugar Company
Image: MAURICE ALAL

Kenya will now be expected to post-trade facilitation officials in Uganda to gather information, monitor and confirm that Uganda sugar exports into Kenya are wholly obtained from Ugandan factories.

Last year, Kenya’s trade officials declined to allow a section of Ugandan products into the country over concerns that the goods did not meet the rules of origin and tariff obligations.

Uganda’s President Yoweri Museveni last Tuesday met with a delegation from Kenya led by Trade CS Betty Maina in Uganda to discuss the verification of the sugar sector.

“Competition has been generated by the fact that we are trading in a common market, however, the ultimate logic of East African Community integration is that one who is more efficient should be allowed to sell. We should eliminate irregularities with strategic analysis, not endless fights,” Museveni said.

The verification mission was in the context of implementing the decisions of the December 18 2020 meeting on sugar exports to Kenya where Kenya agreed to allow up to 90,000 tonnes of Ugandan sugar to access its market duty-free annually.

Grace Adong, Uganda’s acting Permanent Secretary of the Ministry of Trade, Industry and Cooperatives, said the interactions between the two sides aim at building a strong regional block with fewer trade restrictions.

In the verification meeting, the two countries agreed that the Government of Uganda will officially notify the Government of Kenya of its decision to abolish bonded warehousing of sugar and provide verifiable evidence.

Kenya’s Ministry of Agriculture, through the Agriculture and Food Authority, will now fully automate the permit-issuing system and processes by end of December 2020, and ensure that permits issued are linked to capacities of the registered sugar millers in Uganda and other intermediaries in the sugar export chains.

The Ministry will also fully audit the register of permit holders with a view to establishing the fully authorized import/trade permits and weed out the inappropriate ones by end of December 2020.

The Kenyan Government will be expected to conduct a sugar sector verification mission to Uganda.

The CS Betty Maina team will visit more than 14 sugar factories around the country to ascertain Uganda’s sugar production capacity.

Kenya Revenue Authority and Uganda Revenue Authority will also be expected to work closely and link their sugar clearance systems with a view to eliminating the administrative symmetries.

During the meeting, the officials also agreed that concerns on smuggling and re-bagging of non-originating sugar be addressed bilaterally by enforcing stricter border control and surveillance.

Uganda’s Trade ministry figures show that the country has 11 sugar mills producing 510,000 tonnes and the consumption is 360,000 tonnes per annum. The surplus is sufficient for export.