As the East African Community enters its 14th year of integration, there are still penny-pinching issues that have pushed up the cost of doing business.
The EAC’s bid to create a single East African market entails easing travel restrictions, harmonising tariffs and cutting telecommunication costs.
This means the private sector has to be brought at the fore-front since it is regarded as the engine of growth, thanks to its contribution to the economic development of respective member states.
The East African Business Council has positioned itself as the policy advocacy body in the region to ensure that policies are implemented.
Although the EABC has been invited to attend, it has always maintained an observer status.
Moving forward, the EABC has reiterated its inclusion in drafting regional policies.
At their just concluded meeting in Kigali- Rwanda, the EABC chairman, Mr Vimal Shah, said: “Active involvement of the private sector will help realign their thinking towards working for the betterment of the EAC integration agenda.”
A number of issues were outlined by EABC members that if addressed, will reduce the cost of doing business in the region.
To facilitate the free movement of people amongst the member states to do business, one needs some kind of identification.
EAC governments agreed to roll out the use of IDs as a travel document.
However, according to EABC, this process is moving at a snail pace.
So far, Kenya, Uganda and Rwanda have already allowed citizens of the three countries to use the National Identification card as a travel document.
Ms Jacqueline Muhongayire, Rwanda’s Minister of EAC Affairs, confirmed that more than 8,000 people have crossed the Gatuna border between Rwanda and Uganda using the national ID since the start of 2014.
On this matter, President Museveni sustains Uganda’s commitment to ensure the identity cards’ project will soon be computerised to spur free movement.
The President said once this is done, it will be easier for people to access passports which were previously expensive for some people to acquire.
EABC has also called for Tanzania and Burundi to emulate the other member states to allow for easy movement of traders and EAC citizens across the region.
EABC has encouraged partner states to adopt the EAC single tourist visa to increase the flow of tourists to the region and resolve issues affecting the tourism sector since it contributes to the respective economies.
There is a ray of hope as President Yoweri Museveni said the visa will start operating in February this year. He clarified on the countries’ positions where they have put in place systems of revenue sharing.
Mr Geoffrey Baluku, the secretary in the Association of Uganda Tour Operators, explains how it will work.
“If a client say visits a Ugandan Embassy in USA and he/she wants also to visit, Kenya and Rwanda, this implies he/she will pay Shs247,300 ($100). Of this amount, Shs24,750 ($10) will be for administrative fee and the balance of Shs222,750 ($90) will equally be shared by the respective countries where the tourist will visit,” said Mr Baluku who is also a member of the East Africa Tourism Platform.
This system will apply to the tourist who goes through the other embassies.
Currently, stickers are being procured by Rwanda and shared.
Expensive air transport
Costly air transport between the EAC member states has continued to impede the easy movement of business people across the region.
EABC experts want air transport companies in the region to acquire flight rights in the region and request the governments to reduce taxation on the cost air travel.
EABC is also focusing on plans to reduce the cost of telecommunication in the region in order to cut down on the cost of doing business.
Roaming telephone charges, for instance, have been a major impediment to doing business.
The deputy Secretary General, Dr Enos Bukulu, told Prosper magazine that they are in talks with partner telecom regulators to rectify the expensive call rates.
EABC has also asked partner states to set a specific date to remove double taxation.
So far, four countries in the EAC region namely Kenya, Uganda, Tanzania and Burundi have not ratified the agreement on avoidance of double taxation. Rwanda was lauded for taking a lead in ratifying the agreement and facilitating business growth in Rwanda.