Kenya-Tanzania trade wars hit manufacturers despite truce

Kenya Revenue Authority Taveta border post station manager Daniel Onyoyo Ombaka address journalists at the tracks verification yard during a tour of the border post. [Gideon Maundu/Standard]

Manufacturers are frustrated by Tanzania’s push-back over duty-free sugar imports after the country slapped a 25 per cent duty on Kenyan goods.

The Kenya Association of Manufacturers (KAM) said Tanzanian authorities’ refusal to comply with the EAC Preferential Treatment Code had barred local goods, causing manufacturers huge losses.

“Refusal to allow entry of our products into Tanzania has reduced business, caused severe losses to businesses in the value chain due to lack of goods and undermined efforts towards EAC integration,” KAM said in a notice.

The lobby said local industries were operating at lower capacity after Tanzania imposed the duty. This was sparked by the sugar row. Uganda also adopted the tax.

Kenya has invited the two countries to inspect the companies using industrial sugar to produce confectionery to ascertain that what was being used was not brought in under the duty-free concession.

KAM members also met with Tanzanian officials to try to iron out long-standing trade disputes that have rocked the region. “The meeting in Tanzania was useful and it seems some of the issues brought forward will continue to be works in progress,” KAM Chief Executive Phyllis Wakiaga said.

Ms Wakiaga said long-standing issues such as edible oil and sugar-based products were still a thorny issue and that parties would meet again at the end of the month to address them.

“The fact is there are traction and goodwill from both sides, which is an indication for us that we will see some positive changes,” she said.

Some of the issues raised by Tanzania include a claim that the Kenya Plant Health Inspectorate Service had increased inspection fees on trucks from Sh600 to Sh8, 000 shortly after the cooking gas and wheat flower issues were resolved.

Tanzanians also pointed out that their businesses were required to pay Sh500 and Kenyans Sh200 when selling fish at Mabela and Kehancha markets. Kenya has said it needed evidence to pursue the matter.

During the talks, Uchumi and Nakumart supermarkets’ debts to Tanzanian suppliers also arose, with the State saying it was not obligated to settle private firms’ debts. It said the suppliers should seek legal redress.