Kenya, Rwanda on first line to enjoy benefits of Nairobi WTO agreement

Director-General of the World Trade Organisation Roberto Carvalho de Azevêdo. PHOTO | FILE 

By GEORGE OMONDI

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Summary

• Rwanda was the first East African nation to sign the TFA followed by Kenya.
• Kenya and Rwanda are already ahead of the pack in the region, having invested heavily in ICT upgrade of their customs systems.
• Under the TFA protocol, each signatory is supposed to adopt uniform customs procedures and documentation

About one year ago, Rwanda submitted a detailed plan to the World Trade Organisation (WTO) outlining how it intended to ease cross-border trade.

By so doing, the East African nation was simply trying to position itself ahead of peers as the global community haggled over a pact to ease customs procedures around the world.

The deal, dubbed Trade Facilitation Agreement (TFA) had been lined up among the low-hanging fruits of the Nairobi Ministerial Forum, the first such sessions to be held by WTO in Africa. Nairobi, however, failed to rally the requisite number of signatories for the deal initially brokered in Bali.

Almost one year later, the TFA took effect last week, on February 22, after two thirds of the WTO’s 164 members ratified it, promising a significant drop in cost of executing exports and imports around the world.

Rwanda was the first East African nation to sign the TFA followed by Kenya which endorsed it shortly after it hosted the ministerial conference on December 2015.

“By bringing the deal into force, we can now begin the work of turning its benefits into reality.” WTO director-general Roberto Azevêdo said in a statement distributed on February 27.

Countries such as Rwanda, which prepared themselves ahead of the pack are set to benefit immensely as the TFA contains provisions that allows developing states to receive technical assistance from rich countries.

Kenya and Rwanda are already ahead of the pack in the region, having invested heavily in ICT upgrade of their customs systems including introduction of single electronic window system.

Under the TFA protocol, each signatory is supposed to adopt uniform customs procedures and documentation. They are also expected publish procedures and documentation required for importation, exportation, and transit via port, airport, and border points.

Signatories must also provide shippers with details of tax, regulatory fees, rules for the classification or valuation of products for customs purposes, rules of origin, penalties, procedures for appeal and trade restrictions.

“Implementation of the Agreement will lead to a reduction in the cost and time of exporting and importing goods and will be a critical input into making trade happen on the ground. The TFA will enable more SMEs to break out of local and national markets, and tap into regional and international value chains,” the International Trade Centre said last week in a statement dispatched from Geneva .