EAC ministers adopt 35 percent common external tariff
KAMPALA– East African Community (EAC) ministers of trade and finance have adopted 35 percent as the 4th band of the EAC Common External Tariff (CET), officials say.
The Ministers, during a retreat on the comprehensive review of the CET, held yesterday in Mombasa, Kenya, said that the implementation of the reviewed external tariff would commence on July 1, 2022, as the new financial year begins.
The meeting further agreed that there should be flexibility in the implementation of the new 35 percent tariff, particularly on products currently affected by the current global economic realities.
The Chairperson of the EAC Council of Ministers, Betty Maina, who is also the Cabinet Secretary, Ministry of Trade, Industrialization and Enterprise Development, Kenya hailed the move, dubbing it beneficial to the promotion of industrialization and in safeguarding consumer welfare on products where the region is net importing.
“The reviewed CET will address the requests for stays of application, which distort the EAC CET,” she said.
The meeting further directed EAC Partner States to identify products, which are affected by the current global trade disruptions for consideration during the pre-budget consultations meeting scheduled for May 9-13, 2022.
In his remarks, EAC Secretary General Dr. Peter Mathuki, termed the latest development as a positive step towards the promotion of industrial sectors and realization of the benefits of the African Continental Free Trade Area (AfCFTA).
“The move is set to spur intra-regional trade by encouraging local manufacturing, value addition and industrialization,” said Dr. Mathuki.
He said the CET is one of the key instruments under the Customs Union pillar, which justifies regional integration through uniform treatment of goods imported from third parties.
Among the tariff lines in this 4th band include: dairy and meat products, cereals, cotton and textiles, iron and steel, edible oils, and beverages and spirits.
In addition; furniture, leather products, fresh-cut flowers, fruits and nuts, sugar and confectionery, coffee, tea and spices, textiles and garments, head gears, ceramic products and paints, among others.
Officials said the maximum tariff band at 35 percent was the most appropriate rate, as in the long run, it has the most positive impact on regional growth. They noted that in its application, a welfare loss is expected, but would be addressed by employment opportunities from the switch to local production.
The meeting, held in a hybrid format was attended by the respective ministers and principal permanent secretaries from the Partner States.
Burundi was represented by Marie Chantal Nijimbere, Minister of Trade, Transport, Industry & Tourism; Tanzania was represented by Dr. Mwigulu Lameck Nchemba, Minister of Finance and Planning.
Uganda was represented by Trade minister Francis Mwebesa, Rwanda was represented by Beata Habyarimana.
The EAC Deputy Secretary General Eng. Stephen Mlote was in attendance, while the private sector was represented by the Executive Director of the East African Business Council (EABC) John Bosco Kalisa.
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