One Stop Border Posts (OSBP) together with other initiatives supported by the Trademark East Africa (TMEA) have managed to reduce transport and truck turnaround times and trade costs in the intra and extra East Africa Trade significantly.
This has been revealed by a recent brief report that summarises the results of the UK Foreign, Commonwealth and Development Office (formerly DFID)- which commissioned independent evaluation of TMEA programmes.
This included support to trade policy making and integration in the East Africa Community, with the Single Customs Territory (SCT) emerging as a critical EAC programme aimed at enhancing economic integration in the region.
On average, the time to import and to export goods have fallen in the EAC by 54% and 92% between 2010 and 2016, according to the report. The turnaround truck time between Mombasa and Kampala has fallen from 18 days to 4 days. The costs to import and export have fallen, in the same period, by 45% and 66% respectively, the report said.
The Independent evaluation confirmed a reduction in the clearance and transit times. Transport times fell from 21 to 5 days in the Northern Corridor and from 25 to 6 days in the Central Corridor.
Being one of the most integrated and successful Regional Economic Community (REC) in Africa, the EAC has been a significant factor in the increase of trade within the region and with the rest of the world. Total EAC exports increased almost four times between 2000 and 2018 and intra-EAC by almost six times.
The trade facilitation strategy by TMEA has been based on both physical and soft interventions. Among the hard interventions was creation of the OSBP across the region, which have simplified procedures and brought together different trade-related services at the border into a single place. This effort has been sufficient enough to reduce border crossing times and reduce transport costs.
To make OSBP and other physical infrastructure effective, a series of complementary interventions aimed at re-designing procedures and improving the communication and coordination between relevant agencies in the EAC countries have been put in place.
“These soft interventions include a wide range of actions focused on harmonising and simplifying procedures in agencies aimed to oversee the implementation of national and regional policies and legislations such as, among others, securing the safety and quality of products and the compliance of regulations related to transport,” the brief said.
The approach taken by the EAC to increase trade has been multifaceted, and which also serve the purpose of attainment of the ultimate goal of a fully- fledged Customs Union. These include elimination of internal tariffs for goods traded amongst Partner States; implementation of a common external tariff (CET); enactment and implementation of the Customs Management Act and supporting regulations.
In addition, TMEA has supported other initiatives that supplement and contribute to the effectiveness of the SCT and the EAC Customs Union, such as Authorised Economic Operator schemes, NTB monitoring and regional electronic cargo tracking systems.
Working together with the United Nations Conference on Trade and Development (UNCTAD), TMEA has supported the implementation of the WTO Trade Facilitation Agreement (TFA).
This intervention is aimed at supporting the ratification of the TFA by the EAC member States and the establishment of national trade information portals with the aim of promoting transparency of international trade procedures and building the capacity of stakeholders and institutions.
“The increase in transparency and simplification of procedures is likely to have significantly higher impact on small traders and women given the availability of less resources to overcome the information costs and asymmetries,” the report said.
TMEA is also supporting Single Window Information for Trade (SWIFT) programmes. In line with trade facilitation, the SWIFT involves a wide range of actions aimed at simplifying the procedures such as licenses, clearance certificates and so on, which traders have to go through in order to export and import goods.
SWIFT actions allow traders to access, apply for and submit regulatory documents at a single electronic location. SWIFT actions are expected to reduce trade times and costs as well as contribute to the effectiveness of the SCT. TMEA contribution is based on the provision of financial and technical assistance to conduct the mapping exercise and build the necessary IT infrastructure to host the portals.
The East African Community Secretariat (EAC) is developing a regional Customs Bond to support Single Customs Territory (SCT) operations. This product will ensure that a Customs guarantee to secure duties and taxes for goods in transit across EAC is executed only once at the point of entry and hence reduce the costs of using multiple bonds in each Partner State of transit.
