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Economy

Kenyans attack Tanzania on social media over unfair trade laws

President Uhuru Kenyatta (right) meets Tanzanian President John Magufuli during the 19th Ordinary Summit of the East African Community Heads of State in Entebbe on February 23, 2018. PHOTO | CORRESPONDENT | NMG
President Uhuru Kenyatta (right) meets Tanzanian President John Magufuli during the 19th Ordinary Summit of the East African Community Heads of State in Entebbe on February 23, 2018. PHOTO | CORRESPONDENT | NMG 

Kenyans took to social media on Monday to lament trade discrepancies with Tanzania.

The #fairTradeKe trended top most of the day after the Nation published a story detailing a raft of trade barriers placed on Kenyan goods seeking market in Tanzania.

Those who contributed under the hashtag decried the silence from Kenyan authorities as traders from Tanzania enjoy favourable cross border trade into Kenya.

“We should build a wall along the border with Tanzania! I think this is the best time for Kenyans to wake up on the four agendas. Promote trade and manufacturing within. #fairTradeKe ,” a Ruth (@Agribusiness 360) tweeted.

Others called for Kenya to hit back by increased tariff on Tanzanian traders to protect the local manufacturers who have been prevented from exporting to the market through dissuasive tariffs.

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Traders lamented that vehicles bearing Kenyan number plates were targeted by the Tanzanian police forcing the Kenyan traders to hire vehicles from Tanzania to sail smoothly across the border.

More hostility

“Hostility within the East African Community is metered out to Kenyans mainly by Tanzania. Even if Tanzania is claiming to protect its citizens from better economies, there is no need of violating the rights of Kenyan citizens living in Tanzania,” wrote Victor Mochere.

Tanzania and Kenya has been engaged in a periodic trade tiffs with the latest one having emanated from the decision by Kenya to allow for duty free importation of sugar.

Tanzanian authorities insisted that Kenyan manufacturers had used the duty-free sugar to make sweets and other confectionaries.

Dar then slapped a 25 per cent import duty on Kenyan confectionery, juice, ice cream and chewing gum last year.

The duty went on for months forcing Kenya to threaten its trading neighbour with a ban after Tanzanian officials set to visit Kenyan factories to verify the claim kept postponing the visit.

Uganda had joined the punitive duty as Kenyan products became uncompetitive in the two markets and traders suffered massive losses.

When they finally visited in June 2018 and found that none of the Kenyan manufacturers of confectionaries and sugar-based products benefitted from sugar imported under zero duty, only Uganda lifted the duty. Tanzania refused to bulge.

“Uganda has implemented the findings while Tanzania reported that they have reservations on the findings. Further, Tanzania charges 35 per cent duty to confectionary and sugar-based products, in addition they also charge Railway Development Levy (RDL) 1.5 percent (Tanzania Food and Drugs Authority) TFDA levy of 1.5 percent among others.

"This is contrary to what Tanzania was directed not to charge stayed tariffs during the SCTIFI May2018,” read a briefing prepared by the Kenya Association of Manufacturers after a November meeting to end the dispute.

Second verification

Tanzania reportedly wrote to the EAC Secretariat informing the reasons for their reservations for not granting preferential treatment to confectioneries from Kenya. The matter remains unresolved.

Tanzania has since asked for a second verification; a move Kenya has rejected according to the KAM brief.

Tanzania has also restricted imports from Kenya from time to time including chicken and eggs and imposed heavy duty on other products like milk and cigarettes from Kenya; making the products uncompetitive compared with those from other markets and those locally manufactured.

While partner states of the East African Region are required to treat goods manufactured from one another’s country like local, Tanzania has been finding various reasons to slap heavy duty on Kenyan products.

Kenyan traders have also been unhappy with Tanzania for charging $250 for a Business Visa. The fees charged an all the EAC business persons entering Tanzania is branded a ‘Certificate of Temporary Assignment (CTA)as Tanzania maintains that the charge is just a ‘fee on a pass.’

Kenyan traders are now pushing for a similar discriminative visa or pass fee until charges are dropped by Tanzania.

Kenya largely imports wheat, textiles and clothing, cooking gas, hides and skin, oil seeds, vegetables, rice, paper and paperboard, footwear, wood, plastic and rubber, among other products from Tanzania.

Tanzania’s hardball is part of the reasons Kenya’s exports in EAC declined by 30 percent from USD 1.6 billion to USD 1.1 billion in the period 2012 to 2017 while imports have expanded by 60 percent from USD 0.4 billion to USD 0.6 billion in the same period.

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