Lack of information crippling regional cross border trade

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Lack of information crippling regional cross border trade

Lack of information crippling regional cross border trade


As efforts to foster trade within the region show a positive outlook after a series of integration protocols to ease business, lack of information on the side of traders is still holding back the process, experts have revealed.

Traders on all sides cannot understand the demand and supply trend on other side of the borders as well as using such trade information to exploit the market, something that leaves the protocols and policies to boost cross border trade remains on paper.

“To understand what   is needed on the other side of the border is always a challenge for exporters who either export what is not needed or in large volumes and end up not getting the value they expected,” said Davis Mukiza, a business consultant.

Accordingly, East African Member states recently penned down   the common market protocol and the customs Union that saw opening of borders which has facilitated free movement of goods as well as capital.

“Farmers in Kenya can access EU markets through uniform standards and good practices; women cross-border traders in Rwanda and business people in Tanzania have been made aware of the trade opportunities of EA integration; and mutual recognition of professional qualifications will unlock a huge unexploited potential in EA,” said Trade Mark East Africa’s CEO Frank Matsaert.

He adds, “Meanwhile, Partner States’ products will be subject to harmonized EAC standards that will ensure better quality, safety and sustainability of all products”.

Despite this, volumes and value of exports crossing the borders have remained low, with most trade under the informal cross border trade that mostly deals in products that are not value added.

“It is time for out traders to share information regarding what kind of products have market across the border and also look at value addition to compete with  other products  coming from outside the region,” Amelia Kyambadde, Uganda’s Ministry of Trade and Commerce earlier said.

According to statistics from National Bank of Rwanda, the country’s exports within the region showed an impressive growth in the first half of 2014 increasing by 38.6 percent to USD 97.8 million from USD 70.7 million in the same period of 2013.

While on the other hand, its imports recorded USD 247.8 million in the first half 2014 from USD 239 million in the same period in 2013 with informal cross-border total exports declining by -6.6 percent.

Indeed, the positive performance, has led to narrowing of the trade deficit within of trade within the region to USD 150 million by end of June 2014 from USD 168.5 million in 2013, indicating that the improvement of the trade would help leapfrog the economy.

Experts believe that to help cross border trade flourish, there is need for traders among the borders to organize themselves in cooperatives to strengthen their capacity.

“When our traders get organized in cooperatives, it is easier for them to lobby and share information,” said Agnes KatsongaPhiri, Vice chair for Eastern and Southern Africa   at the World Customs Organization.

Indeed, the Ministry of Trade embarked on efforts to bring traders mainly in informal cross border   sector to come together in cooperatives to help them streamline trade through access to credit, improving trade mainly adding value to their products among others.




About the author

Olive Ndaka is the Junior Editor for RwandaEye. An investor and young entrepreneur, she is a quick learner and has contributed many articles for RwandaEye in Kinyarwanda.

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