When the five member states of the East African Community came together and established a Common Market in 2009, their overall objective was to widen and deepen cooperation among the Partner States in the economic and social fields for the benefit of these countries
This meant that the states agreed to eliminate tariff, non‐tariff and technical barriers to trade; harmonise and mutually recognise standards and implement a common trade policy for the Community. For any businessman like myself, it was seen as an opportunity for increased investments and improvements of the economy.
However, due to weak border controls or the removal of trade barriers, corruption and also high taxation on some of the goods, counterfeit and contraband goods have found their place in the EAC Market and pose a threat to the objectives of the Common Market Protocol. What is worrying is the growing trend of these commodities, mostly consumer goods, which is becoming a menace and proving to be difficult to deal with.
I was alarmed by the amount of revenue (Sh161 billion) that the EAC is losing from counterfeit and substandard goods as recently published in one of the local dailies. Looking at that amount of money, it can go a long way in funding education and other sectors needed to achieve our Vision 2030.
We as a country should realise that the consequences of these counterfeits are not only detrimental to the country’s economy but also its health and security. The regional companies and governments of the EAC as a whole lose out on revenue and that in turn destabilises the economic sector. Looking at the whole picture you will see that it has serious negative impacts on the viability of industries, jobs, tax revenues, foreign and domestic investments and the health of consumers across the region.
I don’t need to add more to show you how serious this matter is to affecting our nation and the region as a whole.
I am aware that some of the member states have come up with ways to curb this menace. Kenya and Uganda have come up with anti-counterfeit laws that, I must say, are not proving to be so effective.
In essence, if the EAC region is embracing the spirit of oneness then they need to come up with efficient ways to tackle this problem that will be adopted by all member states. Even so, I understand that until we implement the political federation, each state has liberty to come up with its own laws to tackle this problem…But we need the states to work together and stop this because at the end of the day it’s the region that is suffering the most making it hard to trade and invest as an economic bloc.
I am encouraged that the East African Business Community has presented several requests and proposals to the EAC to try and reduce the entry of counterfeit goods in the market. Let’s hope that they will hasten their implementation process.
Finally my challenge is to the consumer…Whenever we visit a restaurant we do not accept to pay for sub-standard food. We should apply the same school of thought to the counterfeit consumer goods that we insist on purchasing.
Many consumers are aware that they are purchasing smuggled or counterfeit goods, but they are happy to do so, because of the lower price not bearing in mind the risks they present. Think of it this way, without demand, there would be no supply.
Let us work together to build the nation and the EAC region as a whole because in the end we are the ones to benefit.