Non-tariff Barriers and national protection impeding intra-EAC trade
East African Community Secretariat, Arusha, Tanzania, 16th August, 2023: Non-tariff Barriers (NTBs) and protectionism at the national level have been identified as the key factors impeding the growth of intra-EAC trade.
The East African Community (EAC) Secretary General Hon. (Dr.) Peter Mathuki said that the region was therefore working continuously to eliminate NTBs with 26 NTBs having been resolved out of the 33 that had been reported as of June 2023.
Dr. Mathuki added that seven (7) NTBs remained outstanding but were at different levels of resolution.
“To facilitate free movement of goods, Partner States have effectively eliminated Non-Tariff Barriers (NTBs) as they arise and have cumulatively eliminated a significant number of 184 NTBs with only a few remain outstanding,” said Dr. Mathuki.
The Secretary General who was delivering the annual State of the EAC Address at the EAC Headquarters in Arusha, Tanzania, disclosed that EAC total trade increased by 13.4 percent to US$74.1 billion in 2022 from US$65.3billion in 2021, while the total Intra-EAC trade grew by 11.2 percent to US$10.9billion in 2022 from US$9.8 billion in 2021.
The SG further stated that the percentage share of Intra-EAC trade to EAC total trade stood at 15 percent in 2022, and 2023 has indicated a positive trend with 16% in January and 19% in February recorded of total EAC trade.
“The increase is attributed to a strong collaboration with Partner States to promote EAC trade including admission of DRC, timely resolution of Non-Tariff Barriers, enhanced trade facilitation initiatives, harmonization of 2,568 East African standards (Partner States have adopted the EAC Harmonized Standards, ranging from 77% to 91% as of June 2023), promotion of Micro, Small and Medium Enterprises through the Annual EAC MSMEs Trade Fair (Jua Kali Nguvu Kazi exhibition), sensitisation and capacity building of relevant stakeholders, among other things,” he said.
Dr Mathuki said that the implementation of the Single Customs Territory, which is a stop gap measure towards the realisation of a fully-fledged Custom Union in the EAC, has seen a reduction in the turn-around time from an average of 21 days to four (4) days along the EAC corridors.
“About 95% of the EAC Customs regimes including imports and exports have been operationalised with transit being piloted. The average transit time from the main EAC Ports of Entry (Dar es Salaam and Mombasa) to the exit borders reduced from 86.16 hours (3.59 days) to 81.84 hours (3.2 days) in 2022,” said the SG, adding that a comprehensive review of the EAC Customs Management Act, 2004 was also finalised to enhance the operations of the Single Customs territory.
“The operationalisation of additional OSBPs with non-EAC countries Tunduma / Nakonde (Zambia/Tanzania), Moyale/Moyale (Ethiopia/Kenya), and Kasumulu / Songwe (Tanzania/Malawi) has led to a reduction in cross border clearance time by 80%,” he added.
On the Common Market Protocol, Dr. Mathuki revealed that five (5) out of the seven (7) EAC Partner States commenced the issuance of the EA e-Passport to facilitate the free movement of persons across the region.
“To facilitate the free movement of services, the Community adopted and is implementing a Mechanism for Removal of Restrictions in trade in services with the aim of identifying and monitoring the removal of restrictions in service sectors,” said Dr. Mathuki.
The Secretary General said that to facilitate the right of establishment, the Community adopted and is implementing the EAC Private Sector Development Strategy - to catalyse investment and business promotion in the region.
“In July 2022, EAC Heads of State convened in Arusha and discussed the progress made in implementing the Common Market Protocol and identified areas that need to be prioritized to ensure that the Common Market is fully operational, namely the: One Network Area and an Open Skies policy,” he said.
Dr. Mathuki said that the High-Level Retreat preceding the Ordinary Meeting of the Summit will focus on infrastructure development as a catalyst for regional integration.
On the Monetary Union Protocol, the Secretary General said that in addition to the establishment of the East African Monetary Institute, Bills for the establishment of the EAC Bureau of Statistics, the East African Surveillance, Compliance and Enforcement Commission, and the East African Financial Services Commission have been passed by the EALA and are currently awaiting assent by EAC Heads of State.
“The 43rd Ordinary Meeting of the Council of Ministers that met in Bujumbura, Burundi from 19th – 23rd February, 2023, adopted the revised roadmap for the realization of the East African Monetary Union. While the roadmap has 2031 as the year for the adoption of the EAC single currency, we encourage Ministers of Finance to urgently reconsider working towards providing a common currency in the next three (3) years,” he said.
Under the Political Federation, the ultimate stage in the EAC integration, Dr. Mathuki it is the Community’s intention to have the consultations for the four remaining Partner States expedited so that the first Draft Constitution can be ready by the end of June 2024.
“This process involves consulting with various stakeholders, including civil society, local leaders, opinion leaders, and the business community, to seek their views on what kind of Political Confederation they would desire for the EAC,” said Dr. Mathuki, adding that consultations have already been held in the Republics of Burundi, Uganda and Kenya.
On the pending admission of the Federal Republic of Somalia into the Community, Dr. Mathuki revealed that the EAC Secretariat and Council of Ministers have organised the negotiations to begin from 22nd August to 5th September, 2023.
“Thereafter the report will be submitted to the Council for consideration before the Summit adopts and gives the next direction,” he added.
On the EAC-led Nairobi Process for the Restoration of Peace in Eastern DRC, the Secretary General said that the journey towards peace and prosperity is ongoing, adding that with the commitment and cooperation of all parties involved, a brighter future for Eastern DRC and the EAC was within reach.
“EAC Partner States that have made financial contributions to the process include (Kenya, Tanzania, Uganda), while the Republic of Rwanda and the Republic of South Sudan have committed to contribute to the Peace Fund. Further we appreciate other friendly countries of Angola and Senegal who have made financial contributions to the EAC Peace Fund,” he said.
“We appreciate the commitment by the African Union for their recognition of EAC on restoration of peace in Eastern DRC, and their financial contribution to the Community. Some partners who have contributed include the European Union, United Nations, the Swedish Government, among other partners,” added Dr. Mathuki.
Also present at the hybrid forum were the EAC Deputy Secretary General in charge of Customs, Trade and Monetary Affairs, Ms. Annette Ssemuwemba, and her counterpart in charge of Infrastructure, Productive, Social and Political Sectors, Hon. Andrea Aguer Ariik Malueth and other EAC Members of Staff.
For more information, please contact:
Simon Peter Owaka
About the East African Community Secretariat:
The East African Community (EAC) is a regional intergovernmental organisation of seven Partner States, comprising the Republic of Burundi, the Democratic Republic of Congo, the Republic of Kenya, the Republic of Rwanda, the Republic of South Sudan, the Republic of Uganda and the United Republic of Tanzania, with its headquarters in Arusha, Tanzania.
The EAC Secretariat is ISO 9001: 2015 Certified