Regional business lobby urges EAC countries to address emerging non-tariff barriers

Stock market capital gains. [Courtesy/GettyImages]

For years, traders within the East African Community (EAC) have grappled with barriers that stifle the seamless movement of goods and people. These traditional hurdles, which range from police roadblocks and lengthy border clearance procedures to protectionist import restrictions on agricultural produce, have long hampered deeper regional integration.

However, as the EAC tries to resolve these legacy issues, a new frontier of complexity has emerged; the rise of professional and digital services. New challenges are emerging, including disjointed regulatory frameworks and inconsistent licensing, restricting trade in services.

Players are now calling on EAC states to relook their regulatory frameworks to ease the governance of trade in services that have potential to further grow their economies and deepen integration.

"Trade in services remains a critical driver of economic growth, innovation, and regional integration. The EAC Secretariat remains fully committed to the liberalisation of trade in services and the free movement of service suppliers," said Annette Ssemuwemba Mutaawe, the EAC deputy secretary general for Customs, Trade and Monetary Affairs. She spoke yesterday at a meeting on regional trade in services in Nairobi.

"While we have made progress in transport, finance and tourism, we acknowledge that challenges like regulatory fragmentation and capacity constraints remain."

The East African Business Council (EABC) said the slow pace of implementation of enabling policies has made the 'freedoms' of the Common Market feel more aspirational than practical.

"Service providers continue to face complex licensing requirements, non-recognition of professional qualification and restrictive work permit regimes. These barriers raise the cost of doing business and limit the ability of EAC businesses to scale regionally," said Raphael Njau, Acting Executive Director of EABC.

"The EAC Common Market Protocol guarantees the free movement of services and service suppliers. Yet, despite these commitments, many service providers continue to face regulatory restrictions, administrative bottlenecks and inconsistent implementation of agreed frameworks."

"These barriers limit market access, raise the cost of doing business and slow down regional integration, hence rendering these freedoms to be more aspirational than practical."

Intra-EAC trade hovers at around 15 per cent and is dominated by physical goods. The focus is however shifting with trade in services gaining momentum.