EA manufacturers call for uniform tariffs on imports to shield local industries

EAST AFRICA – Manufacturers in the East African region are pushing for the full implementation of the Common External Tariff on goods and cereals from outside the bloc in a move to protect local businesses.

Speaking during the recently held African CEO Forum in Kigali, Rwanda, the manufacturers pointed out that imports from the Asian countries have continued to flood the region’s market which has continued to implicate on their performance.

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Rice, cooking oil, noodles, and wheat and wheat product from China, Pakistan and Taiwan were some of the major imports noted to disrupt the regional market.

They also blamed on tax exemption by some partner states as an additional impediment to long term sustainability of the local businesses.

Vimal Shah, chairman of consumer goods firm Bidco Africa, called for a borderless East Africa highlighting more suitable tariff and non-tariff regimes between the member states as an urgent necessity to address the current situation.

Addressing the forum, Joshua Rugema, chief executive of the East African Commodities Exchange, however blamed the flooding of the markets with foreign goods on the high cost of transportation, reports Business Daily.

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“As long as transaction and logistics costs remain high, goods from outside the region will keep coming. There is still a big infrastructure gap in the region, countries still have to invest in infrastructure if they are to bring down trade costs,” he noted

Mr Rugema further added that additional costs such as packaging make the region’s products uncompetitive while emphasising on the need for the harmonising standards for agricultural products in the region.

“Farmers know that there is a reward for quality, but there is a need for capacity to produce that quality. The demand side has never been better for a farmer,” he said.

This Common External Tariff comes at a time when the African Continental Free Trade Area, which is close to taking effect with only one ratification remaining, seen to shed light in the continent’s economy.

The African Continental Free Trade Area is expected to stimulate intra-African trade by up to US$35 billion per year, creating a 52% increase in trade by 2022 and depressing imports from outside Africa by US$10 billon.

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