There was a collective sigh of relief after the Kenyan government announced last week the end of its long-running trade dispute with Tanzania.
The move followed a bilateral meeting between the two neighbours where contentious trade issues were addressed.
While we welcome the development, we aver that the stalemate was entirely avoidable and should not have been allowed to fester for so long, The new agreement will now see Kenyan made goods like textiles get into the Tanzanian market with ease.
Kenyan textile products had been denied preferential access to the Tanzanian market with Dar es Salaam arguing that they were manufactured at the export processing zones, which are not subjected to duty.
It also argued that the move by Nairobi allowing manufacturers to offload their final products into the local market had hindered similar goods from Tanzania from being competitive in the Kenyan market. Kenya currently allows export processing zone firms to sell up to 20 per cent of their products in the local market.
The ramifications of the trade dispute were felt far and wide. Given that Tanzania has been Kenya’s second largest market in the region, the cost of the impasse was huge, For example, Kenya’s exports to Tanzania dropped by 34 per cent for the first five months of the year to Sh4.35 billion.
We must not forget that such trade disputes also hamper the cross border business that involves small-scale traders.
When the East African Community member states entered into the common market protocol in 2009, the main goal was to ease trade between countries in the region by easing the movement of goods and people.
But we still have a situation where the member states still run their respective trades as distinct and separate units. Other hurdles include customs regulations that have seen some countries operate on their own thereby restricting the flow of goods.
The recent agreement between Kenya and Tanzania is a good starting point that should be further explored to spur trade across the region.
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