The Director General of Customs and Trade at the East African Community, Dr Peter Kiguta, has said transformation of the EAC into a single customs territory (SCT) is required to spur liberalised trade as goods would circulate freely within the territory.
The study commenced in September 2011 and its primary purpose was to develop options and modalities for the attainment of a single customs territory.
Speaking at a two-day stakeholders’ workshop in Arusha on Monday, he said the EAC still suffers internal controls, goods are not circulating freely because in customs union things should work like in one customs territory.
The workshop was called to review the draft final report of a study commissioned last year on the attainment of SCT in the region.
Kiguta noted in a statement issued yesterday that the EAC Heads of State Summit was concerned that internal controls were hindering the region from getting full benefits of a customs union.
To work effectively, a single customs territory requires, among others, a common legal framework, circulation of goods with minimal or no border controls, harmonisation of standards for goods moved through the territory, interconnected payment system and collection of customs duties at the first point of entry.
The study would also recommend an appropriate SCT model suitable for the EAC and determine the most appropriate institutional and legal framework for the execution of the single customs territory.
Over the two-day period, stakeholders drawn from partner states’ institutions deliberated on the recommended policy options and gave inputs to enrich the final report for the proposed SCT, the statement added.
The study’s consultants, Adam Smith International and MA Consulting Group, affirm that a single customs territory in the EAC region would provide benefits such as fewer internal border controls and use of rules of origin, since it would not be necessary to test locally produced goods for compliance with origin conferring criteria.
According to the statement, there would also be no requirement for strict bond controls or need to track consignments to ports of destination, thus allow faster movement of goods and ultimately lowering the cost of doing business.
The study’s final draft report currently under discussion contains a raft of recommendations touching on the policy and institutional framework for attaining the single customs territory.
The key recommendations include: interconnectivity of customs systems in the region to facilitate seamless flow of information between customs stations, a payment system to manage transfers of revenues between partner states and legal provisions to enjoin them to enforce customs debts on behalf of each other.
In addition, the study recommended operation of single window borders (that is, clearance procedures are done under one roof rather than scattered), while in the long term, a regional customs authority with a stronger mandate to enforce compliance with the customs law has been proposed.
The Council of Ministers is expected to submit recommendations of the study to the Summit’s next meeting due next month.