11 February 2013

East Africa: Region Must Resolve Work Permits

opinion

Kampala — When the East African Community was reborn mid 2000 it awakened optimism amongst citizens in East Africa following its collapse in nineteen seventies.

The revival of the community caused excitement and renewed hope especially among the business community as they hoped to enjoy a big market of close to 400 million people following the ratification a free common market.

In fact on July 1 2010 the community launched its own common market for goods, labour and capital within the region, with the goal of a common currency by 2012 and full political federation in 2015.

The common currency or the monetary Union and political federation are yet to be achieved but negotiations though at a snail speed are on.

Because the five member states were now a single trade bloc with open boarders many anticipated that key restriction especially on documentation were to be abolished. As it later came to pass a few restrictions were abandoned well as some were retained.

Key of those that were retained is the mandatory work permit which authorizes a foreign citizen to get employed in his or her alien host country. The work permit as it is well stipulated in the protocol that establishes the common has turned out to be a necessary evil hindering many from enjoying the common market.

The protocol provides for the free movement of goods, persons, labour, services, capital, right of establishment and right of residence within the community. It was also to eliminate tariff and non tariff barriers, ease cross border movement and remove restrictions.

None the less the Common Market Protocol still provides for work permits as a requirement for working in another partner state, except in cases where a partner state has waived the requirement for East African citizens.

However the existence of work permits and its numerous hard to meet condition not forgetting the costs involved have made it difficult for people to work within the region other than their countries of origin.

The categories of people who have been affected are the professionals who are hired from other countries to go and work in countries their employers have business but lack skill that particular person posses.

In 2011 a crack down on journalists who were working in Uganda but lacked the necessary work permits exposed the gap in the mutual integration of the region both economically and politically. Ugandans have hard their wrath in Kenya and Tanzania.

In an interview with Ugandan traders and individuals who have been affected by the strict demand, many blame certain countries for deliberately making it hard for them to get employed in their countries. This is done by hiking visa and work permit fees, requiring very rigid documentation and being adamant to that effect.

Moses Ogwal the director trade at Uganda's Private Sector Foundation reveals that with that conditions hiring of experts from another country becomes hard due to the costs involved. "It makes it harder and expensive to do business," he said.

Ogwal however remains upbeat to the way things are going despite the fact that some countries are ahead of others in terms of liberalizing their laws giving an example of Rwanda which has made it easier from east African to get employed.

People who are having business across the region want government to harmonize the issue of handling work permit by having same requirements and fees.

Tanzania late last year hiked its work permit fees for non nationals a move that riled the affected persons blaming the gigantic country of deliberately frustrating the spirit of East Africa.

It is said class A permit applicants, the self-employed, will have to part with between $2,000 and $3,000 up from the previous average of $1,500 to be authorized to work in Tanzania.

Similarly fees for Class B permit applicants, for firms wishing to recruit foreigners to work in Tanzania, doubled from $600 to $2,000 while class "C" holders are now required to pay between $200 and $500 to be allowed to work.

Another similar case Kenya closed the door on foreigners seeking permits for jobs that pay less than Ksh168,000 per month or Sh2 million per year.

The move, which marks a major labour market policy change, also bars foreigners aged 35 years or less from being issued with work permits. This means unskilled workers who earner lower than that cannot find employment.

Its reported that any non-Kenyans wishing to live/work in Kenya will need to be aware of the new permit costs - an 'H' permit will now cost KSs400,000 (plus fees) for 2 years and an 'A' Ksh200,000 (plus fees) for 2 years.

Uganda is relatively cheap with the lowest charge for a work permit being USD250; this is given to NGO workers and the highest which is given to business owners costing USD1500. Foreigners working in agriculture, mining, and manufacturing have to part with USD500 well as expatriates and professional pay USD600 and USD750 respectively.

Malcolm Spence Trade and Finance Economist working at the Ministry of East African Community Affairs in Kampala believe that East Africa is moving in right direction despites such restrictions that are embedded in the laws managing the integration.

Spence's worry was whether all partner states are following the rules are they are laid out. "If they are then it shouldn't be much of a problem," he warned.

"Work permits are a necessary formality; they serve a function of legitimizing labor movement." Spence further said revealing that some states may be reluctant to give up their sovereignty.

It is this need to protect both political and economic interest by individual states that hinders the common market to bare fruits and puts it at risk. With such behaviors it explains the delay in full economic and political integration of the region which kicked off with pomp.

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