Business
Traders want EAC member states to own Mombasa port
Publish Date: Oct 10, 2012
Traders want EAC member states to own Mombasa port
Containers stack up at the Mombasa port, which traders feel should belong to all EAC
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By David Mugabe

The private sector has called for the re-instatement of the East African harbours and ports authority so that the coastal facilities can be owned and benefit all the five member states of East Africa.

Everest Kayondo, the Kampala City Traders Association chairman, said on Monday that such an undertaking would curtail unilateral manoeuvres like the recent transit cash bond slapped by the Kenya Revenue Authority (KRA) that has caused animosity among local traders.

“Or else for us as landlocked states, let us have another bloc,” said Kayondo during a CEO breakfast meeting between the Ugandan business community and the East African Community secretary general, Dr Richard Sezibera at the Kampala Serena Hotel.

Kayondo said the unilateral undertakings by KRA in a community where there are laid out procedures for handling related matters makes Uganda Revenue Authority appear like a subset of KRA.

Car traders reported that when Uganda’s trade minister visited Mombasa last week, KRA and port authorities temporarily lifted the transit bond and a few cars were released. When the minister left, the cash bond was reinstated.

The transit bond has caused anxiety and distrust among Ugandan business community about Kenya’s intention and disregard for inland states. Ugandan businesses and authorities accuse Kenya of arm-twisting and bullying the rest because of its advantageous position of Mombasa port that remains the nearest link to the coast for inland states.

During the early days of the standoff that began in late August, as Ugandan business community tussled out with the KRA, the East African Community secretariat seemed aloof.

But in Kampala this week, Sezibera said they had sought clarification from the Kenyan authorities. He pointed out that they were told it was not a Kenyan government policy, describing it as an administrative policy. Sezibera, however, criticised the move.

“It is bad administrative policy; we will make sure they are handled correctively,” said Sezibera.

Sezibera revealed that the heads of state of the five member bloc will meet in November to discuss infrastructure, energy, ports and harbours.

He said while all governments have committed to eliminating non - trade barriers, the biggest challenge is how to enforce the commitments.

Gerald Ssendaula, the Private sector Foundation chairman, agreed with Kayondo on the handling of Mombasa, saying as EAC federates, some of this infrastructure will be under the EAC federal government.

“That is where we came from,” the former finance minister, said, adding “(But) this marriage is going to be affected, because you have an advantage, you unilaterally make declarations.”

“If nothing happens within the next two to three days, we intend to meet the head of state because we have done everything maybe, it has to go to the head of state level,” said Ssendaula.

He said even the matter of compensation of traders for the 2007 post-election violence has not been fully handled.

Sezibera said despite the many obstacles, research had shown that the EAC integration has born some positive gains with trade doubling while intra-region investments were up.

“This is a community we should support, the EAC integration process is rightly ambitious but it is also working,” said Sezibera.

KACITA also criticised the disharmony in standards as well as member states belonging to parallel economic blocs.

For instance, Tanzania, a member of the EAC is also a member of the southern African grouping SADC.

On the other hand, Kenya is a member of COMESA and is a signatory to tariff protocols while Uganda also a member of COMESA is not a signatory to tariff protocols.

“What this means is that Kenya can import sugar from Mauritius at 6% import duty while Uganda imports at 100% duty, which means Kenya can use the sugar and have cheaper products,” said Kayondo.

Francis Kamulegeya, a partner at PricewaterhouseCoopers called for synchronised visions among member states.

He said for instance Uganda’s grand vision of building pipelines to the border post of every state would make little sense if the other members do not build corresponding pipelines to pick the fuel.

There were also calls for a more concerted effort to contain the dwindling fish stock in Lake Victoria while the several weigh bridges from Mombasa is a stumbling non-tariff barrier.

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