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EAC asked to confront logistical challenges

EAC asked to confront logistical challenges

THE East African Community (EAC) has been formally asked to solve logistical challenges, fix fragmented value chains and enhance value addition in the bloc.

The newly elected East African Business Council (EABC) Chairman, Mr Nicholas Nesbitt has tasked the Secretariat and governments of the six partner states coalition to direct themselves earnestly on the matters.

In his remarks upon his election in Nairobi, Mr Nesbitt urged the EAC governments to enhance public-private dialogue and formulate policies that would solve logistical challenges, fix fragmented value chains and enhance value addition of products in the region to be competitive in light of the African Continental Free Trade Area (AfCFTA) AfCFTA.

The Agreement establishing Af- CFTA entered into force on 30 May 2019 for the 24 countries that had deposited their instruments of ratification.

The date marked 30 days after 22 countries had deposited their ratification instruments with the African Union Commission (AUC) Chairperson – the designated depositary for the purpose as stipulated in Article 23 of the Agreement.

Earlier this year, EABC held a discussion whose tone was that AfCFTA was not simply a Free Trade Agreement; but was about establishing a unified continental market with 1.2 billion potential customers and where the private sector is a major engine to make it happen.

It envisaged also how the East African Private sector, including Small and Medium Enterprises (SMEs) could benefit from it.

Mr Nesbitt emphasized the importance of the continent having a clear vision to put an end to the fragmentation of the internal market. “I really applaud everybody who has been involved in creating the AfCFTA because their vision is the one of pan-Africanism.

It is something our founding founders aspired to. Our thanks to ECA for being at the forefront of this conversation and pushing the agenda forward so that the continent becomes a single economic trading bloc,” he said.

Mr Nesbitt highlighted EABC’s achievements as setting up Sector-Specific Desks on Trade in Services, Manufacturing, Agriculture, Energy & Infrastructure and SMEs to support members, establishment of EABC-EAC Technical Working Group, EABC’s Offer to host the Africa Business Council Secretariat in Arusha and Tanzania was noted and recorded in the deliberation of the AfCFTA Business Forum and Summit in Niamey, Niger.

The chairman said that EAC partner states adopted EABC’s Proposal on 10 per cent import duty on sugar for industrial use (HS Code 1701.99.10) in 2018/19 and that during the 2018/19 and 2019/20 budgets, Kenya, Uganda and Tanzania adopted EABC proposals to increase import duties on over 50 tariff lines under iron and steel products.

Further attainments of EABC, among others were for Tanzania Bureau of Standards (TBS) being mandated to take charge of assuring the quality and safety of food and cosmetic products while salt manufactured in Kenya was accorded Community Preferential Tariff Treatment by Uganda. He said those are among key milestones.

In his remarks, EABC Chief Executive Officer Mr Peter Mathuki said EABC continues to be the only voice of the private sector at the regional level and plays that critical role of advocating for a conducive business environment in the region.

“EABC is awake to the fact that the intra EAC trade is below 20 per cent vis a vis other RECs (Regional Economic Communities) such as Southern African Development Community (SADC) at 40 per cent and European Union (EU) at 68 per cent, therefore, there is need to strengthen public-private dialogue that will spur the regional intra trade to above 30 per cent in the next two years,” said Mr Mathuki.

He explained that Non Tarrif Barriers (NTBs) remain a challenge to the business community and called upon the EAC partner states to work closely with the private sector towards a NTB free region.

EAC Deputy Secretary General (Planning, Infrastructure, Finance and Administration), Engineer Stephen Mlote, explained that EABCEAC Technical Committee had been successfully formed.

The committee prioritises and addresses trade and investment issues in a bid to improve the EAC business environment in line with the Treaty aspirations and the fifth EAC Development Strategy.

Kenya’s Cabinet Secretary in the Ministry of EAC Affairs and Regional Development, Mr Adan Mohamed, said that EABC should take the lead in reviewing the EAC Common External Tariff (CET) and come up with a CET structure that is beneficial to the East African private sector and make the region more competitive.

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