Politics and policy
Rwanda starts electronic goods clearance system to spur cross-border trade
Posted Sunday, August 5 2012 at 17:48
Rwanda has become the first country in sub-Saharan Africa to launch a one-stop electronic clearing system, beating Kenya in the race to automate cross-border trade procedures and cut the cost of doing business.
The tiny landlocked nation is banking on the virtual platform that links government customs agencies and traders to ease the movement of goods in the East African region as it eliminates the bulky paperwork associated with international trade.
Rwanda also holds pole position in the Doing Business in the East African Community 2012 rankings for introducing new corporate laws and undertaking land and judicial reforms.
The electronic data interchange dubbed Rwanda Electronic Single Window allows traders to submit customs documents online and cuts by half the time required to clear goods and will help businesses save around Sh758 million ($9 million) yearly on customs costs.
“Not only will this bring Rwanda several steps closer to the ports of Dar es Salaam in Tanzania and Mombasa in Kenya but will lead to direct savings for business and introduce greater transparency and accountability into the whole chain of clearing goods,” said Mr Mark Priestley, the Rwanda country director for Trade Mark East Africa.
The move by Kigali to unveil its Sh278 million ($3.3 million) single window portal now piles pressure on the port of Mombasa to embrace technology to streamline export and import procedures where it requires an average of eight documents and takes, on average, 26 and 24 days respectively to clear goods at Kenya’s premier point of entry.
Kenya has been toying with the idea of a single customs digital stop since 2004 and President Kibaki established the Kenya Trade Network Agency (KenTrade) in January 2011 to establish and manage a national electronic single window system to simplify and harmonise trade documentation.
“The system will reduce cargo dwell time at the Port of Mombasa to a maximum of three days and a minimum of one day at the Jomo Kenyatta International Airport. At the border posts the Electronic Single Window System is expected to reduce the cargo dwell time for both transit and intra-regional trade consignments to a maximum of one hour,” said KenTrade in a statement.
It says the single window facility will be connected to the national payment system and will transform the Port of Mombasa, border stations and airports in Kenya into paperless operations. It will automate cargo documentation processes by integrating the systems of all the key stakeholders involved in the process in both public and private sectors.
“If implemented effectively, an electronic system saves precious time and money. It can also reduce interactions with officials, which translates to fewer opportunities for corruption,” says the World Bank report.
The digital clearance portal will integrate the electronic systems of all players involved in the cargo clearance process such as the Kenya Ports Authority, Kenya Revenue Authority, Kenya Bureau of Standards and the Kenya Plant Health Inspectorate Service on a single platform.