Trade war talks is best way out
Trucks parked at the Busia border on March 8 following a maize ban by the Kenyan government. Government has called a crisis meeting to settle the deadlock between Uganda and Kenya. PHOTO | FILE
What you need to know:
- The issue: Trade war
- Our view: Cases of infringements should be communicated formally as agreed, with no partner state taking unilateral bans, or seizures of goods as was the case with Kenya’s recent ban on Uganda’s maize.
It’s great news that Kenya and Uganda have finally sat down, talked over, and agreed to stop their spats over cross-border trade (Daily Monitor, April 20). The April 15 conclusion of the negotiated deals have achieved more than the tit for tat restrictive measures that our policymakers and industry players have been locked in.
The seven-day discussions between Uganda and Kenya’s political and technical teams have done more to offset our dustups over trade blockade. Regrettably, for the last two years, we’ve inconclusively wrangled over tax levies and bans on exports of maize, sugar, LPG gas cylinders, pharmaceuticals, exercise books, juices, beers, spirits, milk, and poultry products.
These non-tariff barriers are our greatest impediments to free movement of goods and services between the two countries. These barriers are enforced despite the East African Community (EAC) Customs Union Protocol, which guarantees free movement of goods and services. This is why this amicable resolution of our trade run-ins should set a precedent as we march into both economic and political integration in the region.
As President Museveni fittingly pointed out, the EAC partner states should cast their gaze farther and be more preoccupied with building competitiveness and not parochial protectionism of our limited individual state markets. Our partner states would rather focus more on opening up our markets to choices by the bloc’s estimated 177 million people.
In this regard, what Kenya and Uganda and the other partner EAC states must do is work jointly to make our value chains longer, diversify our products and create markets beyond the EAC economic bloc.
The decision to allow Uganda to export to Kenya duty free 90,000 metric tonnes of sugar wholly obtained from Ugandan factories is the right thing to do. But this is not the first time that the partner states are engaging in such high talks and resolutions. Similar joint ministerial meetings, for instance in March 2019, have been conducted before and similar resolutions made. What is required now is robust enforcement of these agreements. But Kenya is also right to have reservations on the issue of sugar bonds. Indeed, keeping sugar bonds, smuggling and re-bagging of non-Ugandan originating sugar is not good for the growth, and development of our countries’ local sugar industries.
It’s also healthy that both countries recognize the competence of each other’s national authorities and agencies in matters of trade standards and regulations. Similarly, cases of infringements should be communicated formally as agreed, with no partner state taking unilateral bans, or seizures of goods as was the case with Kenya’s recent ban on Uganda’s maize.
