Political interference killing regional trade - experts

BUSINESS   TRADE

Although trade integration is one of the chief cornerstones of the East Africa Community (EAC) integration, political interference by member countries is weighing down intra-regional trade, experts have warned. 

They said trade wars between member countries are increasingly manifesting because politicians are supping power from established institutions, and using it to fight personal wars. 

Jane Nalunga, the Southern and Eastern Africa Trade Information and Negotiations Institute (SEATINI) Country Director, said the common market protocol, established to facilitate free movement of goods, labour, services and capital is in disorder because politicians only use it as a means to an end. 

Alluding to the recent sugar wars between Uganda and Kenya, Nalunga said the region must abandon protectionism, reduce bureaucracies and respect established protocols to strengthen trade and attract new investments. 

 "The EAC integration has worked well in increasing intra-regional trade. However, there is a lot of political involvement in trade disputes and this is not good for the region. If you look at why Rwanda stopped us from exporting, for instance, or why Kenya has banned our sugar, the reasons are more political than technical. We must not allow political interference to kill trade integration," she said. 

Last month Kenya banned sugar imports from Uganda in order to solve challenges facing its sugar industry. This left Ugandan cane growers and sugar manufacturers stranded. 

Nalunga said an estimated 35,000 tonnes of Ugandan sugar will, therefore, have no access to the Kenyan, market, a place that is currently faced with a deficit in sugar supply. 

Uganda's annual sugar production is estimated at 510,000metric tonnes with local consumption standing at about 360,000 metric tonnes. 

According to the Uganda Sugar Manufacturers Association (USMA), Uganda is currently stuck with approximately 150,000tonnes of sugar following recent bans by Kenya and Tanzania. 

Tanzania had previously enforced a total ban on Ugandan sugar but later relaxed its position to allow in only 20,000 metric tonnes from its EAC partner. 

Nalunga said if the protocol is hard to enforce, regional partners should move to abandon it and opt for negotiated treaties with each other. 

She said having trade disputes in the region is normal, but without strong dispute resolution mechanisms, seamless trade can't be realised. 

Jim Kabeho, the Uganda Sugar Manufacturers Association chairman said although the region has had so many trade protocols in the past, the power to manage them has never shifted to Arusha, making them hard to enforce. 

"These protocols remain ideas in the respective partner states and that is why we have such standoffs. Until we shift the power to Arusha, we shall remain in consensus building agreements, and never realise any headway," he said. 

Kabeho noted that because of the ban in Kenya, the sector is in a crisis with many manufacturers and growers counting enumerable loses.