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Inside the Kenya-Uganda trade talks

President Museveni (R) welcomes a Kenyan delegation led by Cabinet Secretary for Industrialization, Trade, and Enterprise Development, Betty Maina (2nd l) at State House on April 13, 2021. PHOTOS/ PPU

Access to Kenyan market still a pain for Ugandan traders

Kampala, Uganda | ISAAC KHISA | Ugandan traders had high hopes when Betty Maina, Kenya’s Cabinet Secretary for Industrialization, Trade and Enterprise Development visited Uganda on a recent weeklong bilateral visit.

The local traders hoped that the key issues that have plagued commercial relations between the two countries including; Kenya’s continued ban of Ugandan milk and poultry products, LPG gas, and restriction of maize and sugar imports would be decisively resolved.

Last December, Kenya agreed to let in 90,000 metric tonnes of Ugandan sugar into its market annually, following a meeting between the two countries.

This was after the Kenyan government had barred sugar imports from Uganda, arguing that most of the sugar did not originate from its western neighbour.

But a joint communiqué issued on April 15 noted that while the Kampala administration accepted to amend most of its relevant laws to align with the East African Community Customs Union Protocol, the Kenyan delegation kept on acknowledging Uganda’s grievances with “we shall consult on the matter and give feedback.”

Interestingly, Kenya raised issues in relation to Uganda’s imposition of 13%  Excise Duty on Kenyan manufactured juices, malted beers and spirits, 20% tax  imposition on Kenyan manufactured furniture, 12% verification fee of Kenyan manufactured pharmaceutical products, 18% VAT on exercise books and processed poultry meat originating from eastern African state.

Others were; Uganda’s denial of market access to tissue papers manufactured in Kenya on account of difference in interpretation of applicable standards, and Uganda’s denial of market access to Pishori rice said to be grown in Kenya.

Uganda cede ground

During the negotiation process, Uganda ceded ground and promised to amend  relevant laws in relation to imports of Kenyan manufactured juices, malted beers and spirits, furniture and verification fee on Kenyan manufactured pharmaceutical products effective July this year to be in tandem with Article 15 of the East African Community Customs Union Protocol.

But trade experts say Uganda’s fulfillment of its promise will imply the flooding of the Kenyan products on the Ugandan market undercutting local producers. Uganda also agreed to amend relevant laws in relation to VAT imposed on exercise books and poultry meat produced in Kenya.

There were also talks around tissue paper which Uganda has in the past rejected citing poor quality standards but Kenya agreed that it will henceforth ensure compliance with the exporting company.

Regarding Uganda’s denial of preferential market access to Pishori rice grown in Kenya and exported to Uganda, trade ministry officials in Kampala explained that the reason for the current status is because Kenya enjoys the “Stay of Application” for rice and tea, and according to the EAC Trade law, if a product enjoys a Stay of Application, it attracts the full Common External Tariff when exported to the partner state. But, Kenya requested for a special consideration from Uganda to allow duty free market access for the special aromatic Pishori rice grown in Kenya.

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