PUBLISHED ON March 2nd, 2015

EAC grapples with high business costs

ARUSHA, Tanzania – The cost of doing business across the East African Community remain high, in spite of the efforts being made by Partner states and with the support of Development Partners.

In addition, 24 non-tariff barriers (NTBs) still remain unresolved, the just-ended 16th ordinary EAC Summit was told in Nairobi.

“This denies us the opportunity to unlock the immense potential of regional integration and starves businesses of innumerable opportunities,” President Uhuru Kenyatta of Kenya said during the 16th Summit of the regional leaders in Nairobi.

He was handing over the Chair of the Summit to President Jakaya Kikwete of Tanzania.

“To grow intra-Community trade, we need to implement decisive solutions without delay,” he said.

The Kenyan leader said NTBs still complicate businesses in the region. These are also impediments to East Africa’s competitiveness as a global investment destination denying the EAC Bloc unaccountable business and investment opportunities.

“NTBs must go. I am glad to note that our Council of Ministers (the policy organ of the Community) has introduced a legal framework aimed at moving this agenda forward,” he said. Kenyatta also acknowledged the high cost of roaming calls across the region, describing it as yet another unnecessary impediment to trade and communication in the bloc.

“It is unacceptable that in many instances, calling outside our continent is much cheaper than communicating within our region,” he said.

He called for urgent interventions by relevant regulatory authorities on the issue.

However he appreciated the One-Area-Network initiated by Rwanda, Uganda and Kenya recently. The network has reduced the calls to about 12 US cents per minute.

He said he was hopeful other EAC member countries, Burundi and Tanzania, would join the system later.

The EAC Council of Ministers has been directed to expedite implementation of the framework for harmonised EAC roaming charges, including the removal of surcharges for international telecommunications traffic originating and terminating within EAC by July 15, this year.

On the One-Stop-Border-Post (OSBP) to be operationalised soon at the Rusumo, Lunga Lunga/Hororo and Taveta/Holili, Kenyatta said they will reduce clearance time of cargo by 40%. President Jakaya Kikwete lauded the increased intra-EAC formal trade to $5.8 billion in 2013 from $3.7 billion in 2010 and a 6.1 per cent increase in trade between 2012 and 2013, saying it is no small achievement.

Source: East African Business Week

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