3 August 2014

East Africa: Traders to Report Regional Barriers

The ministry of Trade, Industry and Cooperatives (MTIC) has commissioned the Non-Tariff Barriers (NTB) reporting system, where traders will report any problem along the different regional trade corridors through a mobile phone and via email.

The new system is designed to be used by anyone with a mobile phone connected to the four telecommunication companies' networks of UTL, Airtel, MTN and Orange or with internet access.

"The user dials *201# and follows the instructions and submits the complaints at a cost of Shs 140 per SMS," said Allen Asiimwe, the executive director of Trade Mark East Africa, the organization supporting the ministry of Trade on this initiative.

NTBs are laws, regulations, administrative and technical requirements other than taxes (tariffs) imposed by partner states whose effects slow down trade, increase costs of doing business, and block free movement of goods and services.

Speaking at the launch of the system at Sheraton hotel in Kampala, Amelia Kyambadde, the minister of Trade, Industry and Cooperatives, said NTBs were still a challenge to the business community and the government is already focusing on eliminating NTBs.

"The government is already paying attention on NTBs elimination through improving infrastructures like roads, power and the railway network. This will foster economic growth," she said.

Kyambadde explained that NTBs presented a serious challenge to regional trade and integration; they account for a high proportion of the transportation costs in the EAC, which are estimated to be 60 to 70 per cent higher than in Europe and 30 per cent higher than in Southern Africa.

Kyambadde added that the ministry of Trade, using support from TMEA, was implementing a three-year project to eliminate NTBs. MTIC and TMEA signed an MOU in 2012 to implement the National Response Strategy for Elimination of NTBs (NRSE-NTB) project to a tune of $1,400,000 for three years (April 2012 to April 2015).

"NTBs have continued to affect trade in Uganda and the international community, especially in the transport and logistics sector, and in Kenya weighbridges are a challenge," she said.

Kyambadde explained that custom-related regulations had reduced the efficiency of trade, especially in Mombasa. She explained that TMEA had injected $1.4 million in the ministry of Trade and a lot had been realized in the few years such as NTB reporting, which had seen police road blocks removed.

"With our support, weighbridges have been harmonized in Kenya and Uganda; collection of parking fees at border posts has been harmonized; the 16 per cent VAT for goods on transit through Kenya has been removed," she said.

Asiimwe added that clearance of all overstayed vehicles destined for Uganda at Mombasa port had been streamlined and an electronic tracking fee of $100 had been removed from Kenya and transferred to Uganda Revenue Authority (URA).

"NTBs promote hunger and poverty. For instance, declaring your goods and documentation at both border points was time-wasting and since most of our commodities are perishable, losses were great," she said.

One of the key areas is enhancing trade environment, which includes eliminating non-tariff barriers.

"MTIC has achieved a big milestone with this reporting system; traders should be able to report what will be quickly resolved," Asiimwe said.

Kassim Omar, the co-chair of the National Monitoring Committee, who represented the private sector, said this was an important occasion for the private sector. Kyambadde said that so far eight government ministries, departments and agencies had been trained and provided with equipment to receive, investigate and address all reported NTBs.

"We will be working with ministry of Agriculture, URA, Uganda National Roads Authority (UNRA), the Police, and UNBS among others," she said.

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