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L-R Leo Kizito Ojara Commissioner MEACA, Joseph Bukenya Programme Officer SEATINI UG, Faith Lumonya Programme Officer SEATINI UG & Anette Kenganzi Namara Assistant Commissioner, MEACA launching the policy brief & study during the meeting. 

SEATINI, in partnership with the East African Trade & Investment Hub and the Ministry of East African Community Affairs (MEACA) organized the EAC Common Market Implementation meeting to disseminate and validate policy briefs and a company case study. The meeting provided an update on the progress of implementation of key trade and investment facilitating commitments that the Partner States made in respect to the EAC Common Market Protocol.

The meeting also aimed at generating recommendations on the required strategic reforms that will help accelerate implementation of the protocol in Uganda and in the rest of the EAC Partner States. Two key documents developed by SEATINI Uganda and the East African Trade and Investment Hub were disseminated:

  • Implementation of the EAC Rules of Origin: A case of A.K Oils and Fats Ltd
  • Implementation of the EAC Common Market Protocol: Proposals for Review of Investment Related Policies, Laws and Regulations

During the meeting, Golooba Rodney a consultant on the study while validating a policy brief “Assessment of the coherence between Uganda’s tax laws and policies and the EAC common Market Protocol: Policy proposals for reform”, said the objective is to highlight issues to facilitate the smooth implementation of the Common Market Protocol. Harmonization of the tax settings in the common market i.e VAT & income tax rates to create a competitive environment which ensures all member countries have equal rates. The issue of the many non-tariff barriers in the region needs to be addressed.

SEATINI-UG with support from the East Africa Trade and Investment HUB organised a stakeholder’s dialogue to address the challenges/ Non-Tariff Barriers faced by Ugandan clearing & forwarding agents that inhibit access to Mombasa port as well as determining possible solutions. The overall objective of the EAC Common Market Protocol (CMP) is to widen and deepen cooperation among the partner states in the economic and social fields through removal of restrictions on the movement of goods, persons, labour, services and capital and the rights of establishment and residence. However, the implementation of the Common Market Protocol faces challenges. The  2016 EAC Time Bound Program (TBP) on elimination of  NTBs in the region shows that while some NTBs have been resolved, many remain unresolved and new ones are imposed which results in  hindering free movement of goods in the region.

The Ministry of East African Community affairs has a mandate to boost trade in the EAC. This can be fully achieved by ensuring smooth trade among all partner states. The council has provided for an arrangement for airing out issues. All countries can engage on a common table under the single customs in order to address any obstacles. This platform will enable the removal of NTBs that may disrupt the free movement of goods and services.

Challenges addressed;

  • High port charges levied by the Kenya Ports Authority
  • Inefficiency of the shipping lines as well as clearing agents.
  • Lack of evidence based complaints deters the concerned authorities from investigating cases at hand.
  • Ugandan based firms can’t easily operate at Mombasa except entering into partnership with a Kenyan owned firm.
  • Shipping Lines do not allow containers to be released from port to Ugandan clearing firms since they demand either bank guarantees or cash deposits whereas the Kenyan clearing firms have access to guaranteeing by Cheque deposits or on the basis of agreements.
  • Arbitrary Auctioning of Ugandan goods and harassment of Ugandans at the Port of Mombasa.
  • Difficulty in obtaining Port and Simba System.
  • High truck charges for Ugandan vehicles $200 compared to the $50 paid by Kenyan trucks.
  • Time wastage at weigh bridge stations.

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Stakeholders sharing challenges faced during transportation & clearing of goods in the EAC region.

Recommendations;

  • It should be noted that Uganda being a landlocked country, it entirely depends on the ports of Mombasa & Dar es Salaam to clear its cargo. However the former is more cost effective than the latter in the form of distance covered and transport charges. But on considering other factors, the port of Dar es Salaam is cheaper due to its charges being based on the percentage of CIF while Mombasa charges are fixed. In this sense, a clearing agent would advise a client to opt for whichever is cost effective.
  • Cargo transport on Lake Victoria should be revamped as this could bring down the cost of transportation from the both ports to port bell in Luzira.  
  • Kenya Ports Authority should avail a clear procedure for waiver applications. This will help in reducing charges & penalties as a result of delays at the port.
  • The Ugandan government should advocate to ensure that truck fees are reduced.
  • The Ministry of Trade established a mobile platform which helps clearing agents and truck drivers to address issues of Non-Tariff Barriers. This is through *201# which addresses issues of weigh bridges, Standards inspect, Customs, Immigration, Police road blocks, EAC Affairs, Business reg & License, Plant and Animal Inspection.

Ugandan traders ask Tanzania to harmonise cargo transit feesThe private sector in East Africa has asked Tanzania to harmonise the preferential treatments it offers to transit goods as a way of encouraging use of the central corridor .

While Rwandan trucks transiting through the central corridor (Dar es Salaam Port) each pay $150 (Shs535,000); other East African member states such as Uganda are charged $500 (Shs1.7 million) per truck for goods in transit.

Mr Kassim Omar, the chairman Uganda Clearing Industry and Forwarding Association, who is also East Africa Business Council (EABC) vice chair for Uganda, said: “Indeed, the Dar es Salaam Port has improved. But they need to harmonise the transit fees to make doing business in the region less costly.”

Mr Omar, together with other EABC members, had paid a courtesy visit to ambassador John Kijazi, chief secretary, office of the president of Tanzania on Tuesday.