Press Center | Freight Shipping Logistics News
Sep 6, 2008
General
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Trade worth $31.6 million (Sh2.1 billion) goes unrecorded each year within East African Community member states due to cumbersome customs procedures.
Trade worth $31.6 million (Sh2.1 billion) goes unrecorded each year within East African Community member states due to cumbersome customs procedures.
The trend has also been fuelled by export/import restrictions on foodstuff, tariffs on non-EAC originating products.
A recent survey commissioned by the East African Business Council, an apex body of private sector organisations, found out that many cross-border traders are not familiar with customs procedures.
The survey conducted in April this year covered 12 border posts and two inland ports in Kenya, Tanzania, Uganda, Burundi and Rwanda. It found out that formal trade across the 12 stations was quite substantial.
Value of exports
In 2007, the value of exports declared was $2,011,943,898 (Sh136.8 billion) while the value of imports declared was $13,389,733,691 (Sh910.5 billion).
But a report presented at a meeting of private sector stakeholders in the five EAC partner states says some business people are still having difficulties using the customs declaration forms.
The traders cited complexity of the forms. The survey recommended that EAC member states launch the use of the simplified certificate of origin and customs declaration forms.
Only 57 per cent of truck drivers and 75 per cent of cross-border traders interviewed had customs declaration forms at the start of their journey.
Cross-border trade among countries within the regional bloc has also been hampered by delays in clearance at the borders. For instance, it takes 115 minutes for customs to clear trucks across the borders while it takes an average of 44 minutes for customs to clear traders.
Despite increased use of clearing agents – 93 per cent by truck drivers and 59 per cent by cross-border traders – trade facilitation at the borders of East African states is still considered poor.
Many complaints were received from truck drivers over delays in clearing of goods often done intentionally by customs officials, especially in the case of containers.
Other complaints raised in the EABC survey under its Regional Trade Facilitation Programme are loss of clients’ documents and high charges of clearing services.
The highest charges were recorded at the Tanzanian side of the Mutukula border post (with Uganda) and the lowest at the Ugandan area of Malaba border post.
The cost of clearing a cargo consignment was as high as $126.9 (Sh8,629.20) at Mutukula whereas in Malaba it was a mere $3 (Sh204), according to the survey. Clearing of sanitary and phytosanitary goods and inspections associated with them was found to last up to two hours at times.
The survey report recommends that sanitary and phytosanitary officials be posted to all strategic border stations to cover animal and health inspections to enhance intra-regional trade in agricultural produce.
Police barriers were found to be the most notorious among several non-tariff barriers which business people, notably truck drivers, normally encounter when travelling across the region.
About 75 per cent of those interviewed reported having encountered up to 10 barriers on the transit routes.
Others problems cited are extortion, understaffed customs offices, delays at weighbridges, lack of banking facilities and poor roads.
The border posts covered were Mutukula Uganda, Mutukula Tanzania, Gatuna Rwanda, Katuna Uganda, Kanyaru Burundi, Kanyaru Rwanda, Malaba Uganda, Malaba Kenya, Namanga Kenya and Namanga Tanzania. The six-day survey also covered the ports of Bujumbura and Kigoma.
The report recommends improvement of infrastructure at border stations, especially the parking bays, 58 per cent of which are in a sorry state or non-existent.
It also recommends that standards officials be posted in all border stations to ensure the passage of high quality products.
The trend has also been fuelled by export/import restrictions on foodstuff, tariffs on non-EAC originating products.
A recent survey commissioned by the East African Business Council, an apex body of private sector organisations, found out that many cross-border traders are not familiar with customs procedures.
The survey conducted in April this year covered 12 border posts and two inland ports in Kenya, Tanzania, Uganda, Burundi and Rwanda. It found out that formal trade across the 12 stations was quite substantial.
Value of exports
In 2007, the value of exports declared was $2,011,943,898 (Sh136.8 billion) while the value of imports declared was $13,389,733,691 (Sh910.5 billion).
But a report presented at a meeting of private sector stakeholders in the five EAC partner states says some business people are still having difficulties using the customs declaration forms.
The traders cited complexity of the forms. The survey recommended that EAC member states launch the use of the simplified certificate of origin and customs declaration forms.
Only 57 per cent of truck drivers and 75 per cent of cross-border traders interviewed had customs declaration forms at the start of their journey.
Cross-border trade among countries within the regional bloc has also been hampered by delays in clearance at the borders. For instance, it takes 115 minutes for customs to clear trucks across the borders while it takes an average of 44 minutes for customs to clear traders.
Despite increased use of clearing agents – 93 per cent by truck drivers and 59 per cent by cross-border traders – trade facilitation at the borders of East African states is still considered poor.
Many complaints were received from truck drivers over delays in clearing of goods often done intentionally by customs officials, especially in the case of containers.
Other complaints raised in the EABC survey under its Regional Trade Facilitation Programme are loss of clients’ documents and high charges of clearing services.
The highest charges were recorded at the Tanzanian side of the Mutukula border post (with Uganda) and the lowest at the Ugandan area of Malaba border post.
The cost of clearing a cargo consignment was as high as $126.9 (Sh8,629.20) at Mutukula whereas in Malaba it was a mere $3 (Sh204), according to the survey. Clearing of sanitary and phytosanitary goods and inspections associated with them was found to last up to two hours at times.
The survey report recommends that sanitary and phytosanitary officials be posted to all strategic border stations to cover animal and health inspections to enhance intra-regional trade in agricultural produce.
Police barriers were found to be the most notorious among several non-tariff barriers which business people, notably truck drivers, normally encounter when travelling across the region.
About 75 per cent of those interviewed reported having encountered up to 10 barriers on the transit routes.
Others problems cited are extortion, understaffed customs offices, delays at weighbridges, lack of banking facilities and poor roads.
The border posts covered were Mutukula Uganda, Mutukula Tanzania, Gatuna Rwanda, Katuna Uganda, Kanyaru Burundi, Kanyaru Rwanda, Malaba Uganda, Malaba Kenya, Namanga Kenya and Namanga Tanzania. The six-day survey also covered the ports of Bujumbura and Kigoma.
The report recommends improvement of infrastructure at border stations, especially the parking bays, 58 per cent of which are in a sorry state or non-existent.
It also recommends that standards officials be posted in all border stations to ensure the passage of high quality products.
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