Corona row threatens Sh61 billion Tanzania, Kenya trade

The simmering diplomatic row between Kenya and Tanzania over the Coronavirus pandemic restrictions is threatening to disrupt billions of shillings worth of trade deals between the two countries due to retaliatory border closures.

Dar-es-Salaam appears to have reacted to President Uhuru Kenyatta’s order on Saturday to ban movement across Kenya’s borders with Tanzania by blocking Kenyan trucks at the Lunga Lunga/Horohoro and Taveta/Holili border points.

President Kenyatta exempted cargo trucks but said drivers would have to be tested for Covid-19, prompting a Tanzanian regional commissioner to order a blockade of Kenyan trucks, citing hostile treatment.

The differences threaten to slow down trade between the two countries, which amounts to Sh61.5 billion annually.

Nairobi on Tuesday downplayed the order given by the regional commissioner in Tanzania that Kenyan trucks be barred from entering the country.

“We are aware that there are a few trucks of Kenyan registration that have been denied access and entry into Tanzania, but we have not stopped processing vehicles coming from Tanzania into Kenya,” Adan Mohamed, minister for East Africa Community (EAC), said on Tuesday.

“Tanzanian drivers have not been coming with certificates and that’s why we have decided to do the tests in Namanga. The delays that you see there is because we have to administer the tests ourselves and we do not have any certificates that are coming from the Tanzanian side.”

Nairobi intends pursue diplomatic talks with Dar, the CS said, arguing that this would help clear what he termed as a misunderstanding of the action taken by Kenya to curb the spread of the contagious virus that has killed 320,000 people globally.

Kenyan authorities have so far prevented more than 200 truck drivers from neighbouring countries, including Tanzania and Somalia, from entering the country after they tested positive for Covid-19.

On On Tuesday, Kenya said it had barred 40 drivers from Tanzania from entering the country through the Namanga border, slowing down the flow of goods from the neighbouring country.

Goods trucked from Tanzania - including fresh produce such as onions and oranges - last year jumped by more than half, growing 53.79 percent to Sh27.70 billion from Sh18.01 billion in 2018.

Goods trucked into Tanzania by Kenyan companies and traders last year increased 12.99 percent to Sh33.86 billion, trade data from the Kenya National Bureau of Statistics shows. This included mainly consumer goods and machinery. Kenya has reported 963 positive cases of the novel coronavirus with 50 deaths and 358 recoveries.

The East African Business Council (EABC), the regional business community lobby, said it would seek to facilitate a virtual meeting between the Kenyan and Tanzanian ministers in charge of EAC affairs to smoothen the flow of goods between the two countries.

EABC chief executive Peter Mathuki said that goods at the Namanga border were flowing despite delays, with testing taking about 48 hours. According to him, the council was in touch with both sides to resolve the delays. “There are some delays because the tests must be done and people must wait for 48 hours,” Dr Mathuki said via telephone. “What we have recommended is that we should have a testing facility at the border so that it takes a shorter period of four-six hours instead of 48 hours.

Earlier yesterday morning, Kenya Association of Manufacturers (KAM) officials held talks with EAC Principal Secretary Kevit Desai, but the meeting did not take any definite position.

“We will have a follow up meeting later in the week to chart a way forward or at least come up with a position,” KAM told the Business Daily via email.

The manufacturing sector lobby said it had not quantified the impact of the stand-off and that it “will run a survey on members to find out who is affected and to what extent”.

Kenya and Tanzania have been involved in long-running trade disputes which have, at times, prompted the intervention by the Heads of State.

Mr Kenyatta, for instance, met his Tanzanian counterpart in July 2019 where talks to improve trade ties featured although the primary agenda was to lobby the southern neighbour to back Kenya’s bid for a seat at the UN Security Council.

The EAC Common Market Protocol requires member States to open up their borders to facilitate free movement of goods, labour, services as well as capital, but Covid-19 has seen the provision for movement of people relaxed.