Tanzanians topple trade barriers with their cell phones

August 8, 2014

Tanzanians topple trade barriers with their cell phones

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Two years ago truck drivers plying the highway from Dar es Salaam through Tanzania could only fume and argue when they ran into bureaucratic roadblocks, which slowed them to a halt. Today they get around those barriers – with their cell phones.

A trailblazing scheme developed by the Tanzanian business community allows frustrated operators to report Non Tariff Barriers (NTBs) slowing their freight by SMS message and online – and it is working.

“Of all the NTBs that have been reported to us, 42%, that’s nearly half, have been resolved,” says Shammi Elbariki, NTB project coordinator at the online system developed by the Tanzanian Chambers of Commerce, Industry and Agriculture (TCCIA).

The award-winning scheme, developed with help from TradeMark East Africa, has attracted attention from the transport industry across the region as it struggles to overturn NTBs inherited from the days before the East

African Community (EAC) project was launched. “Uganda has already asked about the technology used so that it can devise a similar scheme, and there is similar interest across the EAC because NTBs are an EAC-wide problem,” says Josaphat Kweka, TradeMark East Africa (TMEA) Country Director, Tanzania.

EAC member governments are committed to abolishing NTBs eventually to create a seamless single market that will spur trade and prosperity and TradeMark East Africa (TMEA) has helped create National Monitoring Committees (NMCs) in every state to accelerate the process.

Under the TCCIA scheme, transport operators, freight forwarders and clearing agents are trained how to report NTBs both online and through SMS and these are collated in the project’s small office in central Dar es Salaam and forwarded to the ministry or agency concerned for action.

“We get a lot of complaints from frustrated people,” says Elbariki, “and have worked out that 87% of all the cases we get are actually NTBs and require action. That’s what we do.”

The Central Corridor is a lifeline, not just for Tanzania, but for other EAC countries it reaches – Burundi, Rwanda, Uganda – but also the Democratic Republic of Congo and countries south of Tanzania such as Zambia and Malawi.

“By overturning NTBs, we should be encouraging more trade and studies show that where there is more trade, prosperity follows,” says Kweka.

But it is as fraught with NTBs as any other EAC trade route, barriers that help make East African transport costs among the highest in the world and a drag on growth. Transport costs account for as much as 40% of import costs and every day a truck is on the road costs $400 – a price paid
for by consumers.

NTBs are often hangovers from previous protectionist regimes. One recently resolved case involved a
consignment of shoe polish that was sent from Kenya to Tanzania but was intercepted and delayed at the Namanga border by Tanzanian customs, which demanded a 25% import duty.

The company duly complained through the online scheme that it had been awarded preferential duty-free access – and the shipment was cleared without further problems.

Others are bureaucratic. One often reported and now solved NTB concerns a Certificate of Origin from Tanzania. Kenya’s customs authorities complained that these did not have serial numbers – because the form has a Reference Number instead. This was duly solved.

Another involved traffic coming the other way – from Burundi to Tanzania. Burundi’s Primus breweries, which serve a huge domestic market, wanted to export to Tanzania but a shipment was blocked because the bottles’ labels were in French only, and Tanzania’s language of business labeling in English. The brewer was unaware and changed the labels.

The TCCIA scheme won second prize for innovation in a competition organized by the World Chambers of Commerce Federation two years ago and is seen in the industry and across the EAC as a trail-blazing weapon against NTBs.

“The SMS/Online reporting scheme is simple and easy to use and every complaint is logged so you can easily find out how a solution is progressing,” says Hussein Ahmad Wandwi, Executive Officer at the Tanzanian Transport Owners Association (TATOA).

“I believe it is something many more people could use because it is uncomplicated and anyone can understand it. We should make even more people aware of it and reach massive numbers of people to overturn remaining NTBs.”

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