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Economy

Dar cuts work permit fee for Kenyans to Sh50,500

Tanzania’s President John Magufuli addresses journalists at State House, Nairobi, on October 31, 2016.PHOTO | DENNIS ONSONGO
Tanzania’s President John Magufuli addresses journalists at State House, Nairobi, on October 31, 2016.PHOTO | DENNIS ONSONGO 

Tanzania has ignored calls to scrap work permit fees for residents of the East African Community (EAC) and has instead cut the charges to Sh50,500 per year.

The country’s Immigration services department slashed residence permit fees to Sh50,500 ($500) from Sh202,000 ($2,000) for EAC citizens seeking to stay and work in Tanzania.

This applies to employees from Kenya, Uganda, Rwanda, Burundi and South Sudan.

President Uhuru Kenyatta last month asked Tanzania to waive the work permit charges and honour the EAC Heads of State deal that sanctioned free movement of people, goods, services and capital to achieve the dream of a borderless East Africa.

The permit fees are seen as a barrier to increased trade in the region.

Kenya, Rwanda and Uganda have waived the work permit fees but Tanzania and Burundi are yet to ratify the deal.

“These changes seek to provide preferential treatment to citizens of EAC member countries as compared to those coming from other countries,” Immigration services commissioner for Border Control and Management Abdullah Khamis told the media in Dar es Salaam. The work permit fee for EAC residents seeking to set up business in Tanzania has now dropped by half to Sh151,500 ($1,500) from Sh303,000 ($3,000).

The deal also allows research, law, architectural and real estate firms from sister countries to offer cross-border services. The East African Common Market Protocol, which was ratified in 2010, provides for free movement of workers but the two governments have retained the permits on claims of health and security concerns.

The EAC was first set up in 1967 but collapsed a decade later because of political and economic disagreements between original member states Kenya, Uganda and Tanzania.

Tanzanian officials said the fees reduction aims to attract more investors from the region.

Dar has also exempted EAC students under the age of 18 years from paying student pass fees to study in Tanzania. The minors will now enter the country free of charge.

The country has also cut the fees that Tanzanian men have been paying to marry foreign wives to Sh50,500.

President John Magufuli was in Kenya this week and launched a charm offensive, saying Tanzania needs Kenyans to grow. Kenyan investors top the list of foreign African companies that inject billions of dollars into the neighbouring country’s economy and employ thousands.

Dr Magufuli noted that 529 Kenyan companies operate in Tanzania with their collective investments valued at Sh171 billion ($1.7 billion), employing 56,560 people.

Bilateral trade is sharply tilted in favour of Nairobi but has been shrinking in recent years.

Kenya’s exports to Dar dropped to Sh33.6 billion last year, from Sh42.7 billion in 2014, according to data from the Kenya National Bureau of Statistics (KNBS). Kenya’s imports from Dar dropped to Sh16.9 billion in the review period from Sh18.3 billion.

Kenya is the largest economy in the EAC bloc which comprises Uganda, Tanzania, Rwanda, Burundi and lately South Sudan.

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