The governments of Kenya and Tanzania recently struck a landmark agreement to eliminate long-standing trade barriers and foster economic growth.
The historic agreement was made in Kisumu, where Kenya’s Trade Cabinet Secretary (CS), Rebecca Miano, and her Tanzanian counterpart, Hon. Stephen L. Byabato, Deputy Minister for Ministry of Foreign Affairs and EAC Cooperation, announced the move aimed at reducing the cost of doing business between the two nations.
The trade barriers had impeded trade in key commodities such as tea, spirits, and timber.
The removal of these barriers comes as a reprieve to traders and is expected to enhance trade flows between Kenya and Tanzania.
Traders in both countries have welcomed the move, terming it progressive and in line with the aspirations of the region to expand inter-regional trade.
In a phone interview with Freight Logistics Magazine, FEAFFA President, Mr. Philippe Ndikumana applauded the decision by the two countries and termed it timely. “Tanzania and Kenya have demonstrated the spirit of the EAC, and we thank them for this important decision that largely considered the plight of traders.”
Mr. John Edward Urio, chairman of the Tanzania Freight Forwarders Association (TAFFA), acknowledged the positive strides the two countries have made in enhancing a conducive business environment for all traders, especially the freight forwarders.
“This agreement was long overdue, and we thank the Kenyan and Tanzanian governments for heeding stakeholders’ calls to resolve the outstanding issues and improve trade relations among the two nations.” said Mr. Urio, forecasting an increase in business opportunities.
According to Mr. Roy Mwanthi, chairman of the Kenya International Freight and Warehousing Association (KIFWA), both countries stand to benefit from the lifting of the trade barriers that initially hindered the free flow of goods across the borders.
CS Miano and Hon. Byabato highlighted that the discussions would conclude with the signing of an official communiqué. They also indicated that the two countries will explore other untapped market opportunities and improve volumes of trade between the two countries.
The meeting was also attended by senior government officials from the ministries of trade, EAC, and foreign affairs from Kenya and Tanzania.
The non-tariff barriers eliminated include restrictive regulations, licensing requirements, quotas, embargoes, foreign exchange restrictions, and import deposits, which negatively impacted trade.
Data from the Central Bank of Kenya showed that trade between the two East African powerhouses stood at USD 905.5 million from January to November 2021. With the new agreement in place, it is expected that these figures could be significantly higher in the coming months.
Kenya remains the largest investor in Tanzania, contributing to the region’s economic growth.
This article was published by Andrew Onionga Manguru. For any enquiries, contact him via Email: editorial@feaffa.com; freightlogistics@feaffa.com; onionga@feaffa.com Tel: +254733780240
