Cross-border trade marred by inefficiency, says new report

Legislators have called for a holistic audit and independent inspection of trading cooperatives operating at all border posts after a report indicated they were “disorganised” and not fruitful. The report on cross-border trade was tabled by the parliamentary Standing Committee on Trade and Economic Affairs following a countrywide tour to assess challenges they faced. MP Adolph Bazatoha, the chairperson of the committee, said the main challenges revolved around lack of efficiency, lack of variety of goods that exchange hands at the borders, quality of goods and shortage of storage facilities. “Many of the traders do businesses on small scale. The Government has tried to organise them into cooperatives but many are yet to buy in,” he said. “Cooperatives in place are not well organised and profits are not shared equally among all the members. There is need for better organisation and more audits to find out how they can be supported further.” The MP told the House that without proper management of the cooperatives, cross-border trade, which is mostly done by women, will provide avenues for black markets and illegal trade. He said the audits and inspections will help government get to the core of issues and come up with technical, financial and administrative support. “The traders resist joining cooperatives because they think they can survive alone by illegally trading in untaxed commodities,” the legislator added. Bazatoha also evoked lack of storage facilities such as a cold room to preserve perishable merchandise compelling traders to sell their goods cheaply. MPs expressed dissatisfaction with existing trading blocs such as the East African Community (EAC) and Economic Community of the Great Lakes Countries (CPGL), whose protocols have been ignored by some states. “We have also realised that there is little or non-compliance of trading agreements as stipulated by protocols on EAC, and CPGL, where countries depending on their political situation decide whether to trade or not with neighbours. What can be done?” asked MP Jean Thierry Karemera. The legislators cited Burundi as one of the regional countries that banned trade with Rwanda, and Tanzania, which requires businesses from other partner states to create trading companies under domestic laws and involve Tanzanians as shareholders. The House adopted resolutions including calling on the government to organise a meeting as soon as possible to look into issues. A previous report had identified that 82 per cent of cross-border trade was informal but could contribute more to the national economy if formalised. Only 31 per cent of small scale traders at all borders, according to the findings, are aware of the existence of Comesa, which is expected to ease trade, a fact officials say was shocking because offices of the community are located within. editorial@newtimes.co.rw

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Cross-border trade marred by inefficiency, says new report