Investors hail EA market protocol

November 22, 2009

, NAIROBI, Kenya, Nov 22 – The East Africa Business Council (EABC), the regional apex body of business associations has welcomed Friday\’s signing of the Common Market Protocol noting that it will make the region stronger.

Council Chairman Faustin Mbundu said the business environment in East Africa has greatly improved with many of the stringent restrictions to trade and investment having been removed.

"The signing of the Common Market Protocol could not have been possible without the personal commitment of Heads of State towards EAC integration process. The integration has made the region stronger, through bringing about significant economic reforms, liberalized markets, and diversified trade," he said in a memorandum to the EAC Heads of State.

However, he said that as the region moves towards full integration, there is need to urgently address challenges such as infrastructure bottlenecks, persistent Non-Tariff Barriers and frequent policy reversals if the region is to attain the desired competitiveness.

"The current poor road network, inefficient railway system, and expensive and unreliable electricity supply continues to have a negative impact on the business environment in the region," he protested.

The arbitrary suspension of the Common External Tariff by some countries during pre-budget consultations is the other challenge the private sector was facing ahead of a full fledged Customs Union, he added.

For instance, the sensitive status accorded to the cement sector was removed in June 2008 with import duty being reduced from 40 percent to 25 percent while refrigerated trucks, insulated tankers, garbage collection trucks and 4 wheel drive tourist vehicles were exempted from duty without proper consultation with industry stakeholders.

"Frequent and un-transparent policy changes affect the conditions upon which investment are based and affect the competitiveness of local industries," he said.

Mr Mbundu therefore called upon the EAC Partner States to have appropriate consultations with all stakeholders before decisions are made.

But while he reiterated EABC\’s commitment to continue tracking the presence of Non-Tariff Barriers such as police roadblocks and weighbridges through constant monitoring and reporting, he asked EAC governments to put more effort in eliminating them.

"They should take a regional approach to the reduction of these barriers through reviewing and harmonizing policies, regulations and other legislations," he proposed.

Latest Articles

Business Podcasts

Live prices

Stock Market

Most Viewed