Tanzania and Kenya have planned to set up a channel of communication and form a joint committee to deal with future trade disputes.
They decided this during a meeting between the Minister of Foreign Affairs and East African Cooperation, Dr Augustine Mahiga, and Ms Amina Mohamed his Kenyan counterpart. They met to discuss a trade dispute triggered by Kenya’s ban on cooking gas imports from Tanzania.
Dr Mahiga told reporters in Dar es Salaam that in addition to the joint trade committee, the two countries would also set up a communication channel to facilitate real time consultations in case of a trade dispute.
“The committee will look into all business-related issues on which the two countries deviate,” Dr Mahiga said.
“It’s a committee that will be formed to deal specifically with trade disputes. It will work closely with sectorial ministries from both countries.”
Kenya and Tanzania have had an on-and-off relationship with regards to trade and investment some of which have taken a long time to resolve.
A senior East African Community (EAC) official yesterday welcomed the decision by the two member states to resolve the dispute, adding that the regional body had also put in place a mechanism to resolve such disputes. The recently established East African Competition Authority (Eaca), is charged with resolving regional trade, business and investment disputes. “We encourage partner states to settle trade-related disputes on a bilateral basis before they take a regional outlook,” the official told The Citizen on Monday. The institution will relocate to Nairobi when fully operational.
Eaca was established through the EAC Competition Act, 2006 to manage competition regulation in the community. The Act came into force on December 1, 2014. The Act seeks, among other things, to promote and protect fair trade within the bloc and ensure consumer welfare.
According to the EAC official, the authority is in the process of becoming fully operational.
The recent Kenya-Tanzania trade tiff had a negative impact on some businesses in the two countries, several of which incurred significant losses.
According to the chairman of the Tanzania Business Association, Mr Johnson Minja, the ban put a constriction on cash flows.
“I welcome the initiative to set up a mechanism for permanent consultations for the sake of business continuity. The disruption of sales is very costly for businesses,” he said.
The views of Mr Minja’s were echoed by an assistant lecturer at the Tanzania Centre for Foreign Affairs, Mr Innocent Shoo, who called for immediate consultations in case of a trade dispute.
He said trade disputes needed joint efforts to prevent increase, adding that it was things such as protracted trade disputes that could lead to the collapse of regional blocs.
“I commend the two governments for acting without waiting for the EAC to intervene,” Mr Shoo said. The recent trade dispute was contrary to EAC protocols on the Common Market and Customs Union.