EAC urged to embrace ICT to ease trade processes

Regional governments have been urged to put in place more mechanisms to improve cross-border trade as well as facilitate trade and enhance the business environment in the East African Community (EAC). Frank Matsaert, the TradeMark East Africa chief executive, said EAC must further streamline processes for trade, saying a lot of money is lost importing or exporting goods and services. “For example, Rwandan traders incur almost $5,000 to import a container and deliver it to Kigali compared to just $300 paid by Chinese business people. This is affecting the region’s competitiveness; as well as slow down job-creation and economic growth,” Matsaert said. He said there is need to embrace information and communication technology (ICT) and expand the region’s infrastructure and enact policies that support trade and trade related activities to make EAC, especially the Northern Corridor (Mombasa-Nairobi-Kampala-Kigali) more competitive and attractive to investors. Matsaert said traders still suffer losses while transporting containers from Mombasa to Kigali, which affects business growth and sustainability. Matsaert was speaking at the World Trade Organisation regional dialogue on “Current and future challenges for the multilateral trading system – perspectives from East Africa” in Nairobi, Kenya, on Thursday. The dialogue, organised by Friedrich Ebert Stiftung, was attended by civil society organisations, the private sector and members of the media fraternity from hosts Kenya, Rwanda, Tanzania, Burundi, Tanzania, Ethiopia, Sudan and Malawi. Matsaert lauded Rwanda Revenue Authority’s single window system, saying it has reduced clearance time from three days to just two hours since inception a few years ago. He said this has helped the private sector save up to $20 million annually. Automation of customs systems and adaption of integrated of border management approaches, he added, will go a long way in reducing traders turn times and enhancing the business climate across the region when these initiatives, including the Kagitumba-Mirama Hills one-stop border post and cargo tracking system, are fully implemented. Time-saving initiatives The Mombasa Port Charter, signed a few months ago, also commits all key partners in the region to ensure they put in place initiatives that aim at halving time spent at ports. Speaking on the sidelines of the meeting, Indigo’s Norman Musengimana, a business development consultant who represented the Private Sector Federation, called for harmonisation of policies, especially those that promote industrial growth and value-addition. Commenting on the EAC’s ability to compete in international trade, Musengimana said the bloc needs to train citizens on requisite information so they understand how to fit in the global value chains. “Regional traders find it hard to access or participate in the global value chain because they do not understand how it operates. That’s why we should first trade among ourselves before looking to European markets,” he said. Musengimana said the high cost of finance in the region makes EAC-made goods less competitive compared to those made in Asia and some parts of Europe. Dr Kadri Alfah, the chief executive of the Kigali-based East Africa Exchange, said trade within the region suffers as a result of delays and unnecessary procedures making the region less competitive and also raising the cost of doing business in the Community.

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EAC urged to embrace ICT to ease trade processes