In a recent study by TMA, the restrictions on movement of people also cut off operations of informal cross border traders who significantly contribute to regional trade.

BUSINESS   VIRUS

The current outbreak of the coronavirus pandemic continues to threaten the already fragile intra East African Community (EAC) trade, pulling it back by 40%, according to TradeMark Africa (TMA).

Already standing at a measley20%, TMA said a further drop in intra-regional trade was first registered in March, following measures undertaken by regional governments to curb the spread of the coronavirus outbreak.

Regional governments instituted measure to control the movement of people across borders, after the outbreak, and allowed only the movement of goods.

In a recent study by TMA, the restrictions on movement of people also cut off operations of informal cross border traders who significantly contribute to regional trade.

Informal cross border traders, who mostly comprise women, contribute approximately 60% to trade across the region’s borders.

The trade represents produced goods and services, which directly or indirectly do not pass through the regulatory framework for taxation and other procedures set by Partner States.

TMA said since the outbreak, most manufacturers across the region have also resorted to focusing on local markets, leaving only agricultural goods and products to swing across the borders.

It also noted that: “Due to the current coronavirus pandemic, regional trade has been heavily impacted leading to a rise in NTBs.”

Prior to the COVID -19 outbreak, intra-regional trade had been projected to grow 5%, driven by enforcement of joint policies, reduction of none tariff barriers and exploitation of individual competitive advantages.

According to the EAC Trade and Investment Report, the drop in intra- regional trade came on the heels of an earlier 9.4% growth recorded in 2018.

On average, EAC countries source 6% of their total imports from the region and supply 20% of their total exports to the region.

The report suggested that growth was due to individual member countries showing an increased preference for trading with each other.

The report showed that Uganda had been the region’s most consistent trade partner, surpassing Tanzania in 2017, as its trade jumped to $800m in 2017, from $780m the previous year.

SEATINI executive director, Jane Nalunga said although in the current times, partner states would normally first adopt inward-looking mechanisms, it is important for the region to recognise each other’s interdependence.

“The EAC largely depends on agriculture and its products for its 150million people, therefore, we must depend on each other to maintain a steady supply of the same in this period,” she said.

Disclaimer: The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of TradeMark Africa.