EABC believes that retaliation is not and should not be the ultimate solution but rather the two sisterly nations should sit together to resolve all outstanding issues amicably
ARUSHA, Tanzania: The East African Business Council (EABC) is calling for bilateral dialogue to eliminate all outstanding Non-Tariff Barriers (NTBs) between Kenya and Uganda to boost trade.
In line with the spirit of the Treaty for the establishment of the East African Community, the EABC urges the Republic of Kenya and the Republic of Uganda to hold a bilateral dialogue to avoid a trade stalemate and retaliation due to the imposition of NTBs.
EABC believes that retaliation is not and should not be the ultimate solution but rather the two sisterly nations should sit together to resolve all outstanding issues amicably.
Intra-EAC trade is currently low at approximately. 15% and this low figure is attributed due to the denials of preferential market access to EAC originating products and new trade measures on retaliation will reduce trade further, affect employment, market access, economies of scale of our industries and the well being of East African.
It should be noted that not only do NTBs rise transaction time & the cost of doing business across borders but also set back the competitiveness of products originating from the EAC region.
Two key issues that EABC has identified and yet are critical in resolving persistent and mushrooming NTBs are: 1)The absence of an effective EAC trade dispute settlement mechanism i.e. EAC Trade Remedies Committee and 2) the slow pace of resolution of NTBs by the EAC Reginal Monitoring Committee (RMC).
This is evident as per the recent Sectoral Council of Trade, Industry, Finance and Investment (SCTIFI) meeting of November 2021- only 2 NTBs were resolved and 12 remained outstanding.
On behalf of the East African business community, the East African Business Council (EABC) urges:
1. All EAC Partner States to eliminate all sorts of barriers imposed on goods and services produced from within the EAC bloc as NTBs hinder the free movement of goods as enshrined in the EAC Customs Union and Common Market Protocols at the detriment of East African manufacturers and traders – importers & exporters from both countries.
2. EAC Partner States to ratify Article 24 (2) of the EAC Customs Union Protocol to pave way for the operationalization of the EAC Trade Remedies Committee.
Article 24 of the EAC Customs Union Protocol provides for the establishment of the EAC Trade Remedies Committee tasked to handle matters of Rules of Origin, antidumping measures, subsidies and countervailing measures, safeguard measures and Dispute Settlement Mechanism. Non-existence of the Committee on Trade Remedies makes it impossible for the EAC Council of Ministers to refer matters on the elimination of NTBs to the Committee as is provided for in the EAC Non- Tariff Barriers Act, 2017 (Article 12 (2), (3) and (4).
3. The EABC cautions on retaliation by imposing NTBs as it set back the progress and gains made in terms of Intra-EAC trade; Elimination of current trade barriers and reduces investors’ confidence and predictability of the business environment in the EAC bloc.
4. The EABC urges for the quick convening of the bilateral public-private dialogue between Kenya and Uganda to find win-win lasting solutions on the elimination of NTBs to boost trade, economic growth and jobs for the prosperity of all East African citizens.