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DOING BUSINESS ALONG THE NOTHERN CORRIDOR : NTBs AND OTHER CHALLENGES

DOING BUSINESS ALONG THE NOTHERN CORRIDOR : NTBs AND OTHER CHALLENGES

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DOING BUSINESS ALONG THE NOTHERN CORRIDOR : NTBs AND OTHER CHALLENGES

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  1. DOING BUSINESS ALONG THE NOTHERN CORRIDOR : NTBs AND OTHER CHALLENGES José Maciel Director, Trade Facilitation (Non-Transport) TradeMark East Africa 20th November 2012

  2. THE NORTHERN CORRIDOR

  3. THE NORTHERN CORRIDOR • Within EAC, the corridor begins at Mombasa port to Bujumbura via Uganda and Rwanda, covering 1,970 kilometres • Outside EAC, connects to South Sudan, Democratic Republic of Congo, and Ethiopia • On average 600 trucks use the corridor daily

  4. DOING BUSINESS ALONG THE NORTHERN CORRIDOR: NTBs 1. Behind-the border • Police road-blocks • Kenya: 24 (Business Climate Index Survey, 2011) • Uganda: 21 • Burundi: 4 • Rwanda: 2 • Weigh-bridges (1-3 hours spent on each weighbridge): • Kenya: 12 weighbridges • Uganda: 5 • Rwanda: 2 • Corruption

  5. DOING BUSINESS ALONG THE NORTHERN CORRIDOR: NTBs 2. At the Border • Lack of mutual recognition of standards marks and retesting of goods; additional time to reach the market and costs associated with retesting goods • Multiplicity of regulatory bodies; NSBs, SPS authorities

  6. NTBs – Impact Study EAC & COMESA, 2009 On average, NTBs added >5% to landed cost of goods. On average 20% of annual shipments faced some form of NTBs. For some companies it was 100%. Average direct additional cost of NTBs per shipment was US$3,500 – excluding bribes! It was often taking an average of 6 days to clear goods through Customs. Average cost of border delays (where experienced) was 11% of landed cost Companies spend approx US$145,000 per month on employees time and accommodation costs due to NTBs and delays.

  7. NTBs: TMEA INTERVENTIONS Legally binding mechanism with possibility of sanctions: draft law with the EAC now Bilateral negotiations Survey of NTBs along Northern Corridor (Mombasa-Kigali) for production of a documentary film Strengthening NMCs Online monitoring system Regional harmonization of standards EACQIS

  8. Asanteni Sana!