Posted on February, 21, 2024 at 09:59 am
Kenya’s imports from Tanzania fell by Sh10.23 billion last year on the back of renewed trade barriers, which largely hit the flow of grains from the agriculturally endowed country, official trade numbers show.
Traders trucked in goods worth Sh43.05 billion from Tanzania compared with a record Sh53.28 billion in 2022, according to data collated by the Central Bank of Kenya.
The 19.20 percent drop was the fastest slide since 2016 when the administration of the then-late John Magufuli adopted protectionist policies when he first took power.
Read: Kenya, Tanzania trade war cuts imports 30pc
Dar es Salaam imposed guidelines on trade in grains between the country and partners in the seven-nation East African Community bloc earlier in 2023 in a protectionist move which initially targeted at preventing food inflation.
The rules largely restricted the importation of maize into Kenya. This saw more than 200 Kenya’s trucks blocked for days at the Namanga and Holili borders in June 2023, prompting the intervention of President William Ruto.
The measures were part of food export restrictions, which Dar es Salaam started enforcing in 2022 to ensure food security in a trading bloc which perennially experiences a deficit in maize, a staple.
The rules taken by the Samia Suluhu administration required traders to open and register offices in Dar es Salaam for purposes of getting licences to export maize and other grains as well as tax clearance certificates.
The measures were viewed as “unnecessary” barriers to the smooth flow of goods contrary to the EAC Common Market Protocol, which allows free movement of goods, services, capital and labour within the bloc.
Tanzania’s deputy minister for Investment, Industry and Trade Exaud Kigahe told the 393-member Parliament in Dodoma in June 2023 that the measures were helping “fight exploitation that farmers have experienced for years by middlemen and dishonest traders who have been purchasing crops to farmers at low prices”.
Tanzania is a major exporter of maize and rice, not only to Kenya but also to other EAC bloc states such as DR Congo, Burundi and South Sudan.
Grain export restrictions in Tanzania in part resulted in maize flour prices hitting record-high levels after millers were forced to look for maize supplies in far-flung markets like Ukraine under the Black Sea Grain Initiative.
Read: Boost for Kenya tea exporters as Tanzania lifts imports ban
The thawing of the on-and-off trade tiffs between the two biggest economies in the seven-nation EAC bloc during the reign of former President Uhuru Kenyatta and his counterpart Ms Suluhu had pushed Tanzania to become the second largest source market in the continent after South Africa in 2022.
At the time, goods worth Sh53.28 billion were ordered from Tanzania, only dwarfed by South Africa’s Sh61.06 billion. The sharp drop in the value of imports from Tanzania last year pushed the country to the third largest source of imports in Africa after being overtaken by Egypt, which sold merchandise valued at Sh49.57 billion to Kenya.
Kenya’s exports to Tanzania, nonetheless, climbed 21.77 percent to Sh68.55 billion in 2023 from Sh56.57 billion the year before.
Source: Business Daily