Encouraging Cross- border Trade in Agricultural Products
Although many governments are reorienting their economies towards more open market regimes, the region’s agricultural productivity and cross-border trade are yet to enter a stable growth path and resilience to the impacts of global markets and climate change, according to a new study.
The study titled Analysis of Cross- border Trade in Agricultural Products along selected Corridors of the Nile Basin Region was produced under the auspices of the Nile Basin Imitative Secretariat in Entebbe Uganda, (see our lead story).
According to the study, achievement of broad based and sustainable economic growth in the region has been elusive largely due to challenges relating to: the poor state of infrastructure; underdevelopment of agriculture arising from low investments in the sector.
There is also low use of productivity enhancing inputs, particularly improved seeds and fertilizer, and over-reliance on rain-fed production; policy related issues such as low institutional capacity for implementation, corruption and policy reversals; persistence of non-tariff trade barriers;
vulnerability to external shocks; and, poor coordination of preparation and response to natural disasters.
These challenges need urgent attention by governments and managers of the agricultural sector along the Nile basin corridor since majority of the people along the Nile Basin depend on agriculture for their livelihood.
Many of the Nile Basin countries signed the East Africa protocol which was launched in 2005 and took effect in 2010. The policy was designed to encourage intra-regional trade in agricultural produce. It provides for elimination of custom duties and other charges of equivalent effect, elimination of non-tariff barriers to trade among Partner States and establishment of a Common External Tariff (CET) applicable to all goods imported into the Partner States from third countries. The Customs Protocol further provides for the EAC rules of origin, national treatment and safeguards measures for goods from Partner States and trade in the region.
The Common External Tariff was established so as to protect regional products from external competition. Its establishment meant that goods to and from Uganda and Tanzania would be duty free, goods from Uganda and Tanzania into Kenya would be duty free and specific goods from Kenya into Uganda and Tanzania would attract duty under the program of gradually eliminating internal tariff in five years.
In most borders, fruits and vegetables are zero-rated though the Uganda customs at Malaba charges about US$ 1 per bunch for bananas exported to Kenya.
We at The East Africa Agribusiness Magazine urged the East Africa Community member countries to enforce the EAC protocol and Common External Tariff to promote agricultural trade. This will improve the lives of the people,s of East Africa the majority of whom are farmers.
Look out for our website for more information about agriculture in East Africa.
Our dear esteemed readers look out for our next issue in which we shall analysis for you the grains cross- border trade.