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Cooperation in trade liberalization and development is one of the fundamental pillars of the East African Community (EAC). For this reason, the EAC Partner States agreed in the EAC Treaty of 1999[Article 5(2)] to establish a Customs Union, a Common Market, subsequently a Monetary Union and ultimately, a Political Federation. The East African Community Customs Union (EACCU) commenced its operations within Kenya, Tanzania and Uganda on 1 January 2005. Burundi and Rwanda joined to the EAC in July 2007, Customs is deeply involved in controlling goods which cross borders, determining goods’ nomenclature and origin, and collecting revenue as well as administering trade policies. Hence, the manner in which Customs operates highly affects international trade either negatively or positively. In other words, the manner in which Customs operates can either complicate or simplify the international trade in goods. And this introduces us to the concept of trade facilitation.
The Purpose of this study was to analyze the impact of the EAC Customs Union on Trade Facilitation. The Research design was a case study and qualitative and quantitative research approach was used to answer the objectives of the study. Personal interview, questionnaires documentations and secondary data were selected as the sources of data collection. Four research questions have been formulated to achieve the objective of the study. The result of the study shows there is a positive impact of the EAC Customs Union on trade facilitation however not at higher level due to a number of challenges faced in the implementation of the Customs Union such as attainment of free circulation of goods, tax and trade related regimes and policies are not yet harmonized, Multiple membership, Limited awareness, Non- tariff barriers, Dependence of Customs Tax as a source of revenue. Also study suggested the government to improve, protecting on manufacturing and provide a conducive environment plus an incentive to local produce so as they can be attracted to establish industries within a country; address the problem of informal trade, which is an important drawback of the present regime that leads to revenue losses for the Tanzania government; find a way to formalize most of informal business taken place in a country and to enhance Tanzanian on Entrepreneurship hence they will clear the problem of depending Customs as a source of income. |
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