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Exporters profit from drop in trade barriers

By Patrick Alushula | Published Mon, April 25th 2016 at 00:00, Updated April 24th 2016 at 23:45 GMT +3

Regional traders are saving significantly as a result of reduction in trading times and costs, a recent report by Trademark East Africa (TMEA) shows.

The recently conducted independent evaluation of the non-tariff barriers (NTBs) indicates that most barriers have been eliminated to ensure traders across the region reap the benefits of the trading bloc.

Non-tariff barriers refer to restrictive measures such levies, quotas, embargoes and sanctions used by countries when trading with each other.

According to TMEA, of the 112 NTBs that were identified, 87 have been resolved through the East African Community Time Bound Programme on elimination of barriers.

This was as a result of intervention by the National Monitoring Committee and the EAC Secretariat, with the support of TMEA, which led to the enactment of EAC elimination of NTBs Act.

As a result, the time taken to import goods from one East African country to another has dropped by 14 per cent to 31 days.

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Initially, it used to take an average of 36 days. Burundi has benefited most, with a 28 per cent reduction in import time from 43 days to 30.

Time taken

The time taken to export goods to any East African country has been cut to an average of 26 days. This is a 20 per cent reduction from the initial 33 days.

It now takes 30 days to export goods from Uganda as compared to 35 days in 2011. Similarly, inland transportation times from Dar es Salaam to Kigali have dropped to about 3.5 days. The time spent to get an electronic certificate to clear goods has also reduced.

Tanzania has witnessed the highest drop.

It now takes just an hour to get an electronic certificate of origin, down from five days.

With the reduction in time, costs have also come down.

Transporting a standard container of about 40 feet from Mombasa port to Kigali (Rwanda) now costs an average of $4,500 (Sh455,595).

According to Trademark East Africa, the cost used to be $6500 (Sh658,081) in 2011.

According to TMEA Chief Executive Officer Frank Matsaert, enactment of non-tarrif barrier act was a significant milestone in boosting trade volumes within the region.

“A reduction in NTBs will invariably lead to more trade in the region, which is ultimately our goal of growing prosperity through trade,” he said.

TMEA invested about $7.89 million (Sh799 million) in the NTBs project and expects to continue to bring down non-tariff costs that were approximated at $490 million (Sh49.6 billion) in 2010.

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