NAIROBI, Kenya- The East African Community (EAC) is making significant strides toward harmonizing fees, levies, and charges on essential goods and services in the transport and agriculture sectors.
This ambitious initiative aims to mitigate trade conflicts and boost intra-regional trade within the eight-member economic bloc.
The EAC’s plan, which began in 2021, is nearing the final stages of reviewing and streamlining various fees and levies.
This comprehensive review targets inflated and discriminatory charges, particularly in the transport and agriculture sectors.
The goal is to harmonize these costs across the region, making trade more efficient and less contentious.
The initial phase of this initiative focuses on trading costs in agriculture and transport. Key areas under review include import and export permits for animals, inspection services for animal products, and various charges related to air and road transport.
This meticulous review process aims to eliminate unnecessary costs and foster a more seamless trading environment.
For instance, the fees under scrutiny in the agriculture sector include import permits for live animals and transportation permits for breeding livestock.
In the transport sector, road user charges, passenger service fees in air transport, and docking fees for cargo ships are being closely examined. The ultimate goal is to reduce these costs and make regional trade more competitive.
Trade within the EAC has faced numerous challenges, with poultry trade between Kenya and Tanzania serving as a prime example. In 2021, Tanzania imposed a ban on poultry imports from Kenya due to concerns over the Highly Pathogenic Avian Influenza (HPAI).
This ban significantly impacted Kenya’s poultry industry, cutting off access to a crucial market.
However, earlier this year, Tanzania clarified that it had not imposed a ban but had implemented sanitary measures to protect animal and public health.
This clarification paved the way for the resumption of poultry trade between the two nations, showcasing the potential for resolving trade disputes through dialogue and cooperation.
The EAC’s efforts to harmonize levies and fees are part of a broader strategy to enhance intra-regional trade.
According to the EA Trade and Investment Report (2022), total intra-EAC trade grew by 11.2 pc to $10.91 billion in 2022.
However, the percentage share of intra-EAC trade to the total EAC trade stood at only 15 pc , indicating significant room for growth.
Kenya, for example, saw its domestic exports to the EAC rise by 112.5 pc to $3.51 billion in 2022. Despite this growth, Kenya’s exports to other regional blocs, such as COMESA and SADC, experienced substantial declines.
By streamlining trade costs within the EAC, member states hope to unlock new opportunities for growth and collaboration.
