Failure to Harmonize Trade Standards: How it is impeding cross border trade in EAC

 

BY PAUL TENTENA

Hamidu Musafari, is a truck driver working with one of Uganda’s leading milk processors.

He says that he has been rendered idle because he can’t cross to Kenya to take milk as Kenya, that used to give each milk processor permits for 5 trucks a day through the Kenyan border, right now, very few milk trucks are cleared.

“Initially, each milk processor would get permits for 5 trucks a day through the Kenyan border although right now, only a few trucks can be cleared for an entire week.

“As a truck driver, I have been rendered idle because most times, am seated for close to a week waiting for the permits clearance before milk products can be loaded onto my truck from the factories,” he says.

According to Francis Kisirinya, the Deputy Executive Director of Private Sector Foundation Uganda, countries within the East African Community and the region at large are using the not yet harmonized standards for some of the goods as a technical barrier to trade in the regional.

“There should be enhancing and quickening work of harmonization of standards.

“We have noted that harmonization of standards is now used as a technical barrier to trade with in the East African Community,” says Kisirinya.

Private Sector Foundation Uganda (PSFU) is Uganda’s apex body for the private sector.

It is made up of over 200 business associations, corporate bodies and the major public sector agencies that support private sector growth that do cross border business including milk processors like where Musafari works.

Because, Milk, is not yet one of the tradable goods that the East African Community member states has harmonized its standards, it remains at the mercy of the importing country to allow or not to allow.  Whether the issue is due to quality, over flooding the market, fear of competition, outright protectionism or not.

People like Musafari, will continue to suffer as they wait for the mercy of importing countries if harmonization of standards for all tradable goods is not quickened.

John Bosco Kalisa, the Managing Director of the East African Business Council (EABC) says that out of the 6000 goods with in the region that were identified as tradable, only 2000 have had their standards harmonized.

“We mapped out 6000 commonly traded products and 2000 of these products have had their standards harmonized.

“We are now ensuring compliance on all goods whose standards have been harmonized through Mutual Recognition Agreements,” says Kalisa.

This is just 33% of all identified tradable goods that have had their standards harmonized meaning that a whopping 67% is still on the waiting list.

With Milk, Meat, Poultry, Eggs, not yet among the tradable goods whose standards have been harmonized, Uganda’s milk industry players will continue to grapple with non issuance of export permits and sometimes delays in issuance of the same by the statutory bodies of the importing countries.

Like for Uganda’s Milk, sources have indicated to The Reporters News Uganda that some processors are not getting the permits that allows them to transport their milk to the Kenya market and, are now questioning the criteria Kenya Dairy Board is using to award the permits.

Kenya is the leading buyer of Uganda’s milk products, although the trade relations have not been consistent due to several barriers, prompting Uganda to search for new markets for its milk and milk products.

According to Uganda’s Dairy Development Authority (DDA), the country has established new markets for its milk, which include the Democratic Republic of Congo, South Sudan, Zambia and Algeria.

Others are United Arab Emirates, Syria, Japan, Oman, USA, Nepal and Bangladesh.

DDA, currently says it has over 880 licensed Dairy businesses. Of these, the major players include Mbarara based Pearl Dairies, Brookside Limited/ Fresh Dairy, Jesa Farm Dairy, Amos Dairies Uganda Limited, Paramount Dairies Limited, GBK Dairy Products Limited and Lakeside Dairy Limited among others.

In March this year, Kenya Dairy Board issued a statement stating that they had stopped the importation of milk powders to cushion their industry from surplus production and low producer prices.

Consequently, it said “it would monitor the production and demand for milk and milk products in Kenya and advise its Government accordingly.”

This announcement was directly reinstating the 2021 ban of Ugandan milk products importation into Kenya which went against Kenyan President Ruto’s directive to lift a ban on Ugandan agricultural produce such as milk, eggs and chicken.

Uganda’s annual milk production increased to 3.2 billion litres in 2022, which was a jump from the 2021 production that was recorded at 2.81 billion litres.

 

This earned Uganda a record high of total of over Ush358.6 billion signifying that milk production is on the increase with massive investments by dairy producers and farmers.