EAC states rush to beat market laws deadline

Regional governments are under renewed pressure to clear outstanding cross-border administrative barriers following Tuesday's lapse of a deadline to provide supporting legislation for the East African Community (EAC) common market.

Three member states of the EAC including Kenya, Uganda and Rwanda have already missed the deadline and now look up to December 31 when all members are required to have completed a comprehensive audit of their domestic laws to match those of the bloc.

The other EAC partners, Burundi and Tanzania, failed to attend a joint meeting called in Nairobi last week to provide updates on the matter and their positions are unknown.

Kenya, Rwanda and Uganda however said task forces appointed to handle the provision of enabling legislation for the common market arrangement were at advanced stages of work and are optimistic of meeting the December deadline.

“In our case we are in a phase where we are preparing to have the Attorney-General bring up Bills to guide the process,” Mr David Nalo, the permanent secretary in the EAC Affairs ministry said.

Kenya’s failure to beat the deadline could be partly attributed to a tightly knit calendar that saw Parliament kept busy with legislation guiding the ongoing constitutional reforms.

But even as the three countries said they had missed the August 31 deadline technocrats involved in the creation of the regional common market said they would be forced to clear simplistic administrative barriers that did not require solid legal back up.

“Decisions must be made on simple fronts such as removal of roadblocks on key highways. There is also the persistent questions of customs demanding how long one intended to stay within a country even when the protocol establishing the common market provided for a six month stay,” one of the technocrats said. “Such simple matters don’t have to wait for laws and the member countries have to make decisions”

Some members of the EAC have been cagey about knocking down administrative barriers for fear of their markets being flooded by cheap or counterfeit and contraband goods.

Already the East African Business Council (EABC) has reported a fresh rally in illegal trade in the region owing to the reduction of cross border barriers.

“Without a strong and harmonised regional control mechanism, the risk of escalation of this illicit and harmful trade will remain high and worse now that trade barriers have collapsed even further on commencement of the EAC Common Market last month,” the East African Business Council said in a statement last week.

Preliminary findings of a study conducted by Kenya Institute of Public Policy and Research and Analysis (KIPPRA) back the claims by the council and place the annual cost of trade in counterfeits and substandard goods in the region at Sh180 billion ($2 billion).

The Kenya Association of Manufacturers (KAM) last year estimated that the country loses about Sh50 billion a year through the sale of counterfeits alone while the Organisation for Economic Cooperation and Development (OECD) in 2008 placed the value of illegal trade in the East Africa at Sh40 billion ($500million).

The illegal trade involves cross-border shipment of contraband and counterfeit goods as well as sub-standard products.

The counterfeit consumer goods are basically illegal imitation products offered for sale as if they were authentic, disregarding trademarks.