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FINAL REPORT: THE FEASIBILITY STUDY FOR THE
ESTABLISHMENT OF CAPACITY TRADE HUBS FOR IMPROVING
THE WICBTs/MSMEs BUSINESS ENVIRONMENT IN TANZANIA
RUSUMO KABANGA NAMANGA MUTUKULA BORDER POSTS
Courtesy: Field photo on Trade volumes across Kabanga/Kobero Border Posts – 2014.
INT/71/14A Trade facilitation for women informal cross-border traders and MSMEs in the East
African Community - phase II
ACKNOWLEDGMENTS
The final report1
presents information on the feasibility study for the establishment of the trade
hub to solve WICBTs/MSMEs’ existing bottlenecks related to trade facilitation conditions,
findings and recommendations thereto at Namanga, Mutukula, Rusumo and Kabanga border
posts below. The feasibility study was conducted to inform the decision to provide or not
technical assistance in form of establishing Capacity Trade Hubs in the most suitable border
post (s). The trade hub facilities conform to the promotion of Trade facilitation for WICBT and
MSMEs in the East African Community and as a component of Phase II roll-out project. The
Trade Hubs establishment is intended to assist WICBTs overcome the obstacles they face that
limit their ability to expand their market share in neighboring countries.
The feasibility study would not have been possible without ITC the sponsor of this survey
assignment, through Business Environment Section/ Division of Business and Institutional
Support, by Ezequiel Guicovsky Lizarraga, Senior Business Development Officer and his
dedicated team of colleagues in Geneva - Florian, Beatrice and Uyanga, for their invaluable
guidance, coordination and support throughout the whole study. We are indebted to the
Tanzania Trade Development Authority (TANTRADE) leadership and managements' support.
We thank the Chief Executive Officer Mrs. Jacqueline Maleko -TANTRADE for providing wise
counsel during our inception meeting and the District Commissioners for Missenyi and Ngara
Districts for their participation during our courtesy calls to authorize us to proceed with the visits.
The Regional Consultant expresses his gratitude to the Chairpersons of joint Border
Committees (JBC), border station heads of border government agencies of
Customs/Immigration at Namanga, Mutukula, Rusumo and Kabanga for their invaluable ideas
and guided tours. We are thankful to the Government representatives in the Ministry of Trade
and Industry – District Trade Development Officers – Noel Mungure and Helen Mkongwa for
Missenyi and Ngara respectively; and Ministry of Gender – Community Development Officers at
Missenyi District – Anna Ndile. The Women ICBT Chairpersons and executive members2
of
associations/ groups at Namanga, Mutukula, Rusumo and Kabanga are greatly acknowledged
for their active participation as key informants and focal groups to respond to the designed
questions. The Women participation was central to the quality and credibility of the study
findings.
My heartfelt gratitude goes to the support field survey team that comprised of special and
dedicated individuals by the names of Samuel Billy Mvingire – Director Research and Planning
at TANTRADE, Fwalo John - Senior Programme Officer and focal person of the WICBT project
and Rogasian Mkenda – National Coordinator for ITC Women ICBT project in Tanzania. Their
support and coordination was a mark.
Nuwagaba Mbiine Charles
International Trade Center - Regional Consultant
November 2014.
1
This report is considered final till advised otherwise. Any reviews and discussions (where possible) by clients and relevant stakeholders can be
still done. The agreed changes will be subsequently incorporated after the validation workshop into the very last final report.
2
Refer list of names for WICBT/MSMEs association executive members and border agencies who participated in FGD in the appendix 11
INT/71/14A Trade facilitation for women informal cross-border traders and MSMEs in the East
African Community - phase II
Table of Contents
ACKNOWLEDGMENTS............................................................................................................. 1
ABBREVIATIONS & ACRONYMS ............................................................................................. 3
EXECUTIVE SUMMARY ........................................................................................................... 4
1.0. INTRODUCTION and BACKGROUND........................................................................... 8
1.1. Background to the Assignment ...........................................................................................8
1.2. Why the Capacity Trade Hub Concept and Study...........................................................8
1.3. Definitions of the Trade Hub Concept................................................................................9
1.4. The purpose of the WICBT Trade Hub................................................................................9
1.5. Capacity Trade Hubs Rationale and Location..................................................................9
1.6. Case Study on West Africa Trade Hub (WATH)......................................................................10
2.0. METHODOLOGY and APPROACH ...................................................................................11
2.1. Visits and Study Selection...........................................................................................................11
2.2. Information and Data Collection Procedure .............................................................................12
3.0. KEY FINDINGS FROM THE FEASIBILITY STUDY ...........................................................14
3.1. Assessment of Border Posts for Trade Hubs in Tanzania.....................................................14
3.2. Prioritizing the Border Posts for Establishing Trade Hubs.....................................................21
4.0. POTENTIAL BENEFITS FROM ESTABLISHING THE TRADE HUB AT BORDER
POSTS .....................................................................................................................................36
4.1. General Benefits From Establishing Trade Hubs..........................................................36
4.2. TANTRADE...............................................................................................................................36
4.3. Tanzania Revenue Authority ..................................................................................................37
4.4. EAC and SADC .......................................................................................................................37
5.0. CRITICAL SUCCESS FACTORS FOR ESTABLISHMENT OF ICBT TRADE HUBS....37
6.0. RECOMMENDATIONS ..................................................................................................39
7.0. CONCLUSIONS.............................................................................................................41
8.0. APPENDICES ................................................................................................................42
Appendix 1: Key Informant (KI) Guide Questionnaire ....................................................................42
Appendix 11: Attendance List for WICBT Focal Group Discussion at four Border Posts in
Tanzania................................................................................................................................................43
INT/71/14A Trade facilitation for women informal cross-border traders and MSMEs in the East
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ABBREVIATIONS & ACRONYMS
BIC : Border Information Centers
BP : Border Post
COC : Chamber of Commerce
COMESA: Common Market for Eastern and Southern Africa
EAC : East African Community
EASSI : Eastern African Sub-region Support Initiative of Women
FGD : Focused Group Discussions
ITC : International Trade Center
ICBT : Informal Cross Border Traders
JBC : Joint Border Committee
KI : Key Informant
KWG: Kabanga Women Group
MCOC: Mutukula Chamber of Commerce
MOHA : Ministry of Home Affairs
MOU : Memorandum of Understanding
MSME : Macro, Small and Medium Enterprises
MUWOTA : Mutukula Women Cross Border Traders Association
NTBs : Non-Tariff Barriers
NWICBA: Namanga Women Informal Cross Border Association
OSBP : One Stop Border Post
PS : Prioritization Scale
RC : Regional Consultant
RWG : Rusumo Women Group
SCOO : Simplified Certificate of Origin
STR : Simplified Trade Regime
TANTRADE: Tanzania Trade Development Authority
TNWICBT : Tanzania National Women Informal Cross Border Traders Association
TR : Trade Hub
TIDC : Trade Information and Data Centers
TIDO : Trade Information Desk Organization
TIN : Tax Identification Number
TPO : Trade Promotion Organisations
TRA : Tanzania Revenue Authority
TSI : Trade Support Institutions
WICBT: Women Informal Cross Border Traders
WCBT: Women Cross Border Traders
INT/71/14A Trade facilitation for women informal cross-border traders and MSMEs in the East
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EXECUTIVE SUMMARY
The final report is the last deliverable for the study on the establishment of the trade hubs in
Tanzania. The report discusses the findings, and proposes strategic recommendations arising
out of the study on each border post of Mutukula, Kabanga, Rusumo and Namanga. The study
focused on the prioritizing the border post, identifying the best place, existing infrastructures,
women’s needs assessment, human resource capacity to operate the hub: and a review of
imports/exports’ volume data as required and stipulated terms of reference.
a). The summary findings of the feasible and unfeasible aspects necessary for establishing
Trade Hubs at each border post below were premised on the prioritization scale (PS) derived on
the criteria set against the terms of reference. Variations in the trade volumes, the formalization
and readiness of the women groups and its members are the main ingredients that scale them
apart.
Mutukula Border Post
(i). Mutukula border post scores highest on PS for first priority to pilot and implement a trade
hub pilot over the other three borders on the following strength and opportunities as referenced
in the matrix under section 3.2:-
 It is amongst the growing border posts in Tanzania estimated to import 5% of the national
imports from the East African Community (EAC) for 2013 higher than Kabanga and Rusumo
(Part 1 – a).
 The border post has a completed and spacious OSBP facility ready to host all border
agencies upon commissioning. The OSBP operations are pending completion of its
juxtaposed one at Ugandan side and is expected to be completed in 2015 (figure 1).
 It has an existing Women Group – locally known as MUTUKULA WOMEN CROSS
BORDER TRADERS (MUWOTA) with highest numbers of 48 fully registered members of
the association and at the exact frontier (Part v –a).
 The MUWOTA association has a constitution and it is in the final stages of registration with
the District at Missenyi and Ministry of Home Affairs in Dar within 2015 (Part I – d).
 It has the lowest estimated time of readiness – up to six months to carry-out the pilot and
subsequent implementation of the trade hub (Part iii – f).
 It has high potential and available women who may qualify to become experts and train-of-
trainers for their fellow members on account of higher levels of education from secondary to
university education (Part iv – b).
 Exhibited lowest needs of training to develop services for their fellow members (Part iv – c)
 It has an association that can become a potential candidate for the trade hub (Part iv – d)
 It has on average of 400 – 500 highest members of ICBTs who are estimated to cross the
border daily (source: - Mutukula JBC).
(ii). Mutukula border post faces some challenges and threats to host a trade hub in the short-
run:-
 It has the lowest volumes of exports about 12% through Mutukula to the community, which
is the lowest of the other three border posts.
 Due to the already planned and space allocation within the OSBP facility, the WICBT groups
and any other private sector entity don’t have automatic qualification at the moment to
access it. JBC will be seen to make up their indicative promises during the study after the
OSBPs’ commissioning.
 Location of the trade hub outside the OSBP facility would imply that women needs would not
be effectively served since one will require exiting the facility first in order to access it.
INT/71/14A Trade facilitation for women informal cross-border traders and MSMEs in the East
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Whichever way the decision taken by JBC will be, it is critical to consider the dual placement
approach of the trade hub both inside and outside the OSBP facility.
Kabanga Border Post
(i). Kabanga border post would take the second slot against PS to implement a trade hub pilot
over the other two borders Namanga and Rusumo on the following strength and opportunities:-
 The percentage shared volumes of domestic exports that are destined to the community
through Kabanga border post are second highest estimated at 25% (Part 1-b).
 Kabanga Women Group has developed the first draft constitution and submitted it to Ngara
District authorities for review. Other than MUWOTA of Mutukula, no other border post
women group presented any constitution making document.
 The estimated time or the implementation of the trade hub is estimated up to a period of
nine months (Part 111-f).
 Kabanga Women Group was identified as the existing and potential women group
associated with informal cross border trading at the time of the visit (Part v- d).
(ii). Kabanga border post faces some hurdles and threats to host a trade hub in the short-run:-
 The percentage share of import volumes passing through Kabanga border post is estimated
at less than 1% originating from the community (Part 1-a).
 The existing women group has no capacity at the moment to provide human resource
experts. The sampled members at the executive levels indicated to have dropped out from
secondary and primary levels of education. External expertise will be necessary (Part 1v-b).
 The specific training needs to develop services or women must be tailored and customized
to the lower levels of education (Part iv-d).
 The OSBP facility is still undergoing construction and may get ready later in 2015. There is
still higher uncertainty on permitting operations of the trade hub inside an OSBP facility
given the similar conditions and concerns in most other border posts’ facilities.
 The Kabanga women group has lost registered members from 27 to the current 15
members (Part 1-e).
 There are limited premises readily available in the vicinity or nearest both the old and new
sites of the border station. The trading centre is more than 500 metres away from customs
and immigration offices.
 The piloting and establishing a trade hub prospects at Kabanga border post could be in a
hold-up phase3
for nine months till the women group has been registered and members
adequately re-tooled and re-grouped.
Namanga Border Post
(i). Namanga border post is placed in the third slot for consideration for priority to implement a
trade hub pilot due to the following strength and opportunities:-
 There is a completed structure of OSBP facility ready for commissioning as soon as their
juxtaposed complex at the Kenyan side is completed.
 The percentage share volumes of trade from or to the community on imports at 54% and
exports at 35% are recorded through Namanga as highest amongst the three border posts
(Part I - a & b)
 There are many private premises and land opposite the OSBP facility to consider options of
placement for the trade hub.
3
Hold up phase in the context of this study is the transition period through which a WICBT/MSME group will take to grow and attain capacity
to manage the pilot of establishing a trade hub at the designated border post. The period should not exceed two years.
INT/71/14A Trade facilitation for women informal cross-border traders and MSMEs in the East
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(ii). Namanga border post faces some challenges and threats to host a trade hub in the short-
run:-
 There is no formal association formed yet. Namanga women group is planning to initiate the
process of formalization into a registered association with Longido District authorities (Part
iv-d).
 The draft constitution consultative and making process has not yet commenced Part i-d).
 The sampled members of the executive committee are largely primary level of education
graduates.
 There was neither apparent nor existing expertise among the WICBT members (Part iv-b).
 The low levels of education demands and requires specialized training materials and skills
that are tailored to develop services for women (Part iv-c).
 The estimated time for the implementation of the trade hub has been put up to 12 months
provided the capacity development and registration process are progressed uninterrupted.
 Therefore this puts Namanga border post at the holdup phase before piloting the
establishment of the trade hub till the growth path of WICBT association formalization (part
111 (f) is attained.
Rusumo Border Post
(i). Rusumo border post is placed in the last slot for consideration for priority to implement a
trade hub pilot due to the following strength and opportunities:-
 There is a near completion and well-designed OSBP facility that is expected to be ready for
commissioning and occupation in the year 2015.
 The percentage share volumes of trade from the community on exports at 22% was
recorded through Rusumo as third highest amongst the three border posts (Part I – a & b)
(ii). Rusumo border post faces some challenges and threats to host a trade hub in the short-
run:-
 Rusumo Women Group is yet to initiate the process of formalization into a registered
association (Part iv-d)
 The draft constitution making and consultative process with women members has not yet
commenced Part i-d).
 The sampled members of the executive committee are largely primary level of education
graduates.
 There was no apparent expertise that could be identified among the women members (Part
iv-b).
 The low levels of education demands specialized training approach, materials and skills to
develop services for women (Part iv-c).
 There are limited and expensive private premises and land opposite the OSBP facility
available for placement of the trade hub. The landscape is a ridge with steep slopes ending
into river Rusumo (Part iii – e).
 The estimated time for the implementation of the trade hub has been put up to 12 months
provided the capacity development and registration process are progressed uninterrupted
(Part iii - f).
b). Summary Conclusions and Recommendations
i. The feasibility of establishment of trade hubs in the short run of 6 - 12 months in Tanzania
border posts will happen if both the promoter ITC and in conjunction with the TANTRADE
agrees to roll out a pilot project at Mutukula border post according to the prioritization scale.
Evidence on the findings has established that majority women group’s lack of resource
INT/71/14A Trade facilitation for women informal cross-border traders and MSMEs in the East
African Community - phase II
capacity (mainly human resource expertise and start-up funding) to sustain the pilot phase
let alone to establish and operate the Trade Hub.
ii. The introduction and establishment of trade hubs as modernized fully furnished/ equipped
and visibly branded facilities will enable these units and the trade hub agents employed
therein cope (e.g. former customs officers) with border agencies’ modernization practices.
iii. To the extent possible, trade hubs should operate as opposite facility sets of establishments
for each border post in the neighboring country as a shared trade facilitation facility to aid
informal cross border traders in both countries.
iv. Feasibility studies for establishing trade hubs should be carried out in both border posts
neighboring each other, resources notwithstanding. For instance, studies conducted on
border posts selected on Tanzania side should correspondingly be done on the opposite
sides the neighboring community states i.e. Rwanda, Uganda, Kenya and Burundi.
v. Introducing and establishing trade hubs in border posts hosting OSBP facilities will require
a placement of the trade hub based on two-part location; one part inside the OSBP to deal
with such services as customer care, advocacy and trade information. The second part to
handle external services such as capacity building and training which are most suitable to
an independent location outside the OSBP. However, location outside the OSBP should be
targeted within the immediate proximity to enable close contacts with border agencies. This
two-tier location informed the estimates made in the matrix part iii (e).
vi. The existing MOUs should incorporate the initial joint ownership of the trade hub between
ITC and TANTRADE to establish commitment, capacity to roll-out and later smooth transfer
to competent associations and their leaderships.
vii. The medium-term option of securing a customs clearing license and diversifying to money
changing business should be considered as means to support women groups and income
streams for the future growth and sustainability of the trade hubs. These licenses could be
taken under the responsibility and custody of TANTRADE or any future designated national
WICBT body corporate on behalf of its member associations and individuals. A reasonable
clearing and service fee could apply to trade hub users. This fee in turn would become
additional revenue/income for supporting trade hub activities.
viii. Based on the market price indicators during the study, the operations cost of
establishing a functional and fully-equipped trade hub is dependent the two-tier location
requirement. In scenario one if JBC gives a positive nod to offer occupancy space inside
the OSBP and outside location, the following cost estimates will apply i.e. 1 – USD$39,100
renting premises. 11 – USD$57,400 renting land for placement of fabricated trade hub. 111
– USD$58,600 building a trade hub. In scenario two if JBC delays or even objects
admission into OSBP, then consideration to locating outside OSBP takes center-stage and
lessens the corresponding cost estimates of USD$17,600 meant to cater for inside the
OSBP i.e. Options 1- USD$21,500 for renting premises. 11 – USD$39,800 for renting land
to place fabricated units. 111 – USD$41,000 for construction of trade hub structure (Refer to
the matrix Part iii – e).
INT/71/14A Trade facilitation for women informal cross-border traders and MSMEs in the East
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1.0. INTRODUCTION and BACKGROUND
International Trade Centre (ITC), appointed and engaged the Regional Consultant, to conduct a
feasibility study to establish and introduce Trade Hubs for Women Informal Cross-Border
Trades (WICBTs) and Micro Small and Medium Enterprises (MSMEs) in Tanzania on the
establishment of is implementing the second phase – 2014-2015 of regional project to facilitate
the improvement of EAC WICBTs and MSMEs. The feasibility study is a component critical to
the success and full implementation of the project. The report is part of a series of two country
studies covering the Burundi and Tanzania four border posts each. The capacity trade hubs are
expected to improve the WICBT business environment and the transition from the informal to
the formal sector to increase exports to neighbouring countries4
.
1.1. Background to the Assignment
The ITC and in conjunction with Tanzania Trade Development Authority (TANTRADE) signed a
Memorandum of Understanding to implement the Trade Facilitation for WICBTs and MSMEs in
the EAC – Project Phase II for the period 2013-2014. ITC intends to achieve this objective
through improving the business environment and the transition from the informal to the formal
sector to increase exports to community neighboring countries. The project phase II aims will
further be enhanced by the introduction of the capacity trade hubs as one of its key ingredients
and initiatives. In this context, the trade facilitation process required conducting a feasibility
study at the four selected border posts of Namanga, Mutukula, Rusumo and Kabanga in
Tanzania. The main objective of conducting such a study on the placement and installation of
WICBT/MSME Capacity Trade Hub service centers at border posts is to ascertain whether it’s
feasible to include further value adding activities that develop Women commercial exchanges at
border, growth, emergence and the more contribution to building the economy of neighboring
countries in the EAC. The findings and recommendations attest to this.
1.2. Why the Capacity Trade Hub Concept and Study
Women ICBT practises, like any other ICBTs at the border posts in Tanzania and in the EAC
region, simply reflects longstanding indigenous pattern of trading practices that makes more
sense than formal trading channels. Throughout the region, ICBT practices continues to be
incentivized both by the persistence constraints (e.g. visible and invisible NTBs) facing formal
trading but also a feature of economic and social life such as survival well-being of traders.
Therefore the capacity trade hub project is an initiative, if successfully established and
implemented, expected to contribute to women development in their transformation of the
longstanding WICBT informality perceptions and practises that long existed at cross borders.
The trade hub initiative is intended to introduce a permanent trade facilitation center at border
posts through which continuous engagement and capacity development of the women traders
will be sustained. It is further anticipated that most ICBTs will gradually be aided through trade
hubs to the formality trading practices across borders which directly contributes to building the
economy of neighboring countries in the community.
In this report, the feasibility study for trade hubs has examined the current conditions of each
border post of Namanga, Mutukula, Rusumo and Kabanga for the Trade Hub, strategic location
for Trade Hub, existing infrastructures that can facilitate the establishment of the hub, women’s
needs assessment in terms of expected trade hub, human resource capacity to operate the hub:
and a review of imports/exports’ volume data at each border crossing. Reference was made to
4
OECD Trade Policy Working Paper No.86, 2009 categorized informal traders into three ascending but inter-related groups i.e. first informal
that is unregistered and operating outside the formal economy; second are registered but avoid official border crossing posts; third are
registered but partially evade trade regulations and duties through illegal practices such as under-invoicing. Similarly, Trade hubs should target
and assist women growth in their registered associations at level 2 and 3 to formality.
INT/71/14A Trade facilitation for women informal cross-border traders and MSMEs in the East
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the previously prepared literature and conducted studies on border crossing in the region and
elsewhere. The data and information has aided establish the current conditions and capacity at
each crossing. Once the current conditions were understood, the study formed the basis to
examine the planned Trade Hubs establishments and other related issues in Tanzania. The
findings are presented along with conclusions and recommendations herein.
1.3. Definitions of the Trade Hub Concept5
The concepts of trade Hubs for WICBT was originally conceived and defined in phase-one of
the project. Consistent with the previous definition of capacity trade hubs, the planned trade hub
for establishment will be a central point where WICBTs/MSMEs can access assistance related
to customs procedures and export requirements, capacity building services, answers to
common trade facilitation hurdles such as questions on trade compliance and export market-
related information and assistance. This facility could be a designated place such as an
office/center; and should be best located within and near the customs control zone within the
border post precincts.
1.4. The purpose of the WICBT Trade Hub
The trade hub is purposed to provide four key ingredients:-
 Customer care services that renders assistance related to customs procedures and export
requirements and answers to common cross border trade facilitation hurdles. Trade hub
services must facilitate and create a faster, simpler, transparent and more
predictable/supportive cross border environment
 Trade information and data regarding cross border trade compliance and export market-
related information with neighboring business transactions.
 Regular capacity development and refresher training to associated cross border traders
 Advocacy with strategic partners from national, regional and international sphere for a
shared role.
1.5. Capacity Trade Hubs Rationale and Location
The trade hub rationale for WICBTs in this study is three fold:-
 Continued effort to the transformation of informal women traders from informal to formal
trading practices through deliberate export-led strategies and change management process.
 Promote and support Women issues with special attention to customer care services and
capacity development on cross border facilitation.
 Support planned and fit into the existing national and regional policy with its regulatory
framework regarding informal and formal cross border trade.
In the case of Tanzania all the four border posts under study i.e. Namanga, Mutukula, Rusumo
and Kabanga are designed and constructed under the One Stop Border Post (OSBP) concept.
Therefore location of the trade hub will then depend upon the functionality and services it will
offer. If the JBC committee adopts a decision to agree and approve the allocation of space and
occupancy of the WICBT inside the OSBP, it may offer limited space for occupation such as a
desk office that can offer customer care/advocacy/trade information services. Other key
activities relating to capacity building, training, workshops and conferences/meetings will require
spacious location and less noisy/busy outside the OSBP but in the proximity of the border post
precincts. There are also can be occasional opportunities to utilize the OSBP board room.
In the entire set-up and location context, it is imperative to understand the OSBP concept and
its operations. The OSBP means a border post established under section 3 of the OSBP Act as
5
Derived from the Trade Facilitation for Women Informal Cross-Border Traders and MSMEs in the East African Community – Phase II (Inception and Rollout)
INT/71/14A Trade facilitation for women informal cross-border traders and MSMEs in the East
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revised 2013, at which all traffic utilizing the border post stops only once in each direction of
travel and both exit and entry procedures are undertaken from within the same control zone.
The OSBP concept introduces a zoning phenomenon known as common control zone. A
“control zone” under the Act means the part of the territory of the hosts Partner State within
which Officers of the adjoining Partner States are empowered to effect border controls and
includes the “exclusive use area”. This implies that on completion of OSBP facility construction
at the designated borders, it must be enclosed by either fencing or perimeter wall which curves
out and excludes other commercial and social activities outside it in the border post. The JBC
committee usually follows strict allocation criteria on demands of office space giving first priority
to all relevant Government agencies and critical private sector such as Customs agents and
chamber of commerce. This arrangement puts a 50-50 chance of securing office space and the
activities of the trade hub to be located partly within or/and wholly outside the control zone.
1.6. Case Study on West Africa Trade Hub (WATH)
A comparative case study
6
on one of the USAID sponsored trade hubs in Africa, under its West Africa
Trade Hub (WATH) is provided as part of the findings and demonstration to the Tanzania WICBTs and
MSMEs. The WATH is premised on the identified key measures to improve regional integration in West
Africa following a comprehensive Gap Analysis on the Economic Community of West African States
(ECOWAS) Free Trade Area. The Gap Analysis identified the need for improved public–private dialogue
and coordinated private sector advocacy regarding implementation of the ECOWAS Tariff Liberalization
Scheme (ETLS). As a result, WATH assisted leading firms with trading and transport operations in the
region to form a private sector association, known as the Borderless Alliance (BA). Established in 2011,
the Alliance is a business association that leverages its members’ influence to identify and advocate for
evidence-based transport and trade policy reforms. The Borderless Alliance established an independent
secretariat and founded National Committees in Côte d’Ivoire, Nigeria, Benin, and Senegal. It is thus well
positioned for long-term sustainability and self-governance.
One of BA’s most successful endeavors has been the creation of Border Information Centers (BICs) at
border posts along the highly trafficked trade corridors in the region. As mentioned previously, the earlier
analysis had highlighted the need to increase awareness of ETLS rules and procedures among the
private companies trading and transporting goods within the region, as well as the public agencies
responsible for regulating trade. Regional traders find that ports and land borders are major bottlenecks
due to the multiplicity or rules and procedures required to move vehicles and goods through border
processes—and the lack of consistency in implementation.
Each BIC operates with two offices—one on either side of a land border (in Senegal, the Port of Dakar
has its own BIC). Each office is staffed with a knowledgeable trade advisor from the host country who
advises shippers, truck drivers, producers, and traders on specifics of the regional agreements (and
border clearance requirements of the entering or exiting country). With USAID support, from November
2011 to early 2014, the BIC network expanded to nine such information centers. Most BICs are
established in partnership with the national shippers’ council of the host country, which usually provides
the physical location of the center and which may provide in-kind support. Other financial support to the
BICs comes from Customs agencies, national shippers’ councils, and other border stakeholders. USAID
has supported the salaries of Trade Advisors (generally former Customs Officers of their respective
countries) stationed at each border, and has funded trainings, coordination meetings, publications, and
outreach activities. USAID has published a Border Information Center toolkit, intended to guide and
inform future implementers on best practices in setting up and monitoring impact.
The BICs are already demonstrating significant improvements at the borders where they have been
launched. In the second quarter of 2013, for example, average clearance times at borders with BICs
decreased by 27% as compared to the previous quarter.
6
Adapted from a comprehensive approach to trade facilitation and capacity building; connecting developing countries to
supply chains march 2014 business environments for agile markets sponsored by USAID; authors : Ro Bert Holler, Erin Endean,
Paul J. Fekete, And Virginia Brown page 34.
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2.0. METHODOLOGY and APPROACH
2.1. Visits and Study Selection
The feasibility study on the establishment of WICBT/MSME Capacity Trade Hubs in Tanzania
was conducted in two phases between 7th
and 12th
September and 26th October to 1st
November 2014; and focused on one side of the border in Tanzania. The border sites studied
were Kabanga (Burundi/ Tanzania), Namanga (Kenya/Tanzania), Mutukula
(Uganda/Tanzania) and Rusumo (Tanzania/ Rwanda).These sites were selected and
recommended by TANTRADE because they are among the strategic cross border trading
centers and exit routes of the country for both exports and imports to/from community (EAC)
countries. There is a high presence of WICBTs activities carried out both on export and import
cross border trading.
The approach employed a selective qualitative study that targeted focus group discussions
involving WICBT chairpersons and their executive committee members since the outcomes will
have immediate benefits to their associations. The Office In Charges Customs -Tanzania
Revenue Authority, Head of Police and Immigration border post were targeted and consulted as
key stakeholders directly involved in supporting placement and establishment of the trade hubs.
A review of literature and secondary data was made to acquaint ourselves on the best practice
elsewhere (especially WATH & Uganda) the trade hubs have been established or/and are being
piloted. The sample size for the questionnaire survey is represented in table 1 below. The
selection of the women leaders was purposeful and was based on the participation in
association decision making on behalf of their members. Besides during the implementation
phase, the same women leaders will most likely participate in the success and
operationalization of the trade hub
Table 1: Participation of Women ICBT of different Age Groups, Marital status, Occupation and Education by
Border location
Age Group
Border Post
Below
15
15-
20
21-
30
31-
40
41-
50
51-
60
61
+
Grand Total
Namanga 3 2 3 8
Mutukula 1 3 4 3 1 12
Rusumo 1 4 5
Kabanga 1 3 3 1 6
Marital Status Married Single Widowed Separated Total
Namanga 6 1 1 8
Mutukula 8 3 1 12
Rusumo 5 5
Kabanga 6 6
Occupation Border
Agency
official
WICBT
member
MSME
member
Clearing
Agent
Total
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Namanga 8 8
Mutukula 8 4 12
Rusumo 5 5
Kabanga 6 6
Education University Tertiary/
College
Secondary/
Primary
Other Total
Namanga 8 8
Mutukula 1 3 8 12
Rusumo 5 5
Kabanga 6 6
Source: Primary Data from the field study
The Women groups at all the border posts and their associations were indeed found to
represent a critical mass of their members i.e. 21 - Namanga, 48 - Mutukula, 38 - Rusumo and
15 - Kabanga. The other key informants belonged to the Government border agencies and
included the Office In charge of Customs border posts –Tanzania Revenue Authority (TRA) at
Namanga, Mutukula, Rusumo and Kabanga border posts. They are the current Joint Border
Committee chairpersons at the four respective border posts. Other border post official heads
came from Immigration, Regional and District offices at Longido, Missenyi and Ngara. The
private sector at Namanga and Tanzania National Chamber of Commerce – Mutukula Branch
participated as additional key informants.
2.2. Information and Data Collection Procedure
2.2.1. The Study Entry Process
The study team consulted all the parties as key stakeholders, decision makers and
representatives with influence to support determine the placement and establishment of the
WICBT trade hub. In Tanzania the power centers and structures are deliberately linked to the
center in Dar es Salaam. For instance, any activity to be carried out in the district must be
reported to the District headquarters, the district consults the center in Dar. The study entry
process started with the District Director before proceeding on to visit any of the four border
posts. The Director received the team and was given a briefing from TANTRADE representative
and Consultant. He then asked the Trade Development Officer to accompany the study team as
a Government/District representative.
2.2.2. The Joint Border Committees and their Roles
The study team was assisted and guided by the OSBP Joint Border Committees. All the four
border posts visited were designed and constructed under OSBP concept and arrangement.
Namanga and Mutukula OSBP facilities are completed for occupation pending completion of
their opposite and counter-part OSBPs in Kenya and Uganda respectively. OSBPs at Rusumo
and Kabanga are expected to be completed and perhaps commissioned in 2015 since their
counter-part OSBPs in Rwanda and Burundi are already in operations. Tanzania government
through her relevant ministries established JBCs and assigned TRA as chair. Each of the OSBP
border posts above must be organised under JBC administrative structure which functions as a
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governance organ that forms the first layer of decision making on the day-to-day operational
activities and challenges without consulting regularly from the central government in Dar. What
is the Joint Border Committee (JBC)? The JBC is a multi-Sectoral collaboration of key
government agencies and the private sector involved in the border post clearances for the
purposes of:
- Promoting a trade facilitation mind set to all relevant and participating cross border
stakeholders
- Defining critical operational challenges and providing possible solutions at the borders
- Enhancing inter agency collaboration and mutual trust/cooperation at border post
- Encouraging joint usage and sharing of available resources at the border
- Arbitration and defusing tension and conflict between public and private sector
- Minimizing the disconnect with Headquarters in Dar and bridging the any existing gaps
- Rationalizing control and regulation at the border posts through wider consultations
JBC is a border post organ that will not only influence placement of the trade hub inside OSBP
but also critical to collaborate with WICBT and enable their success.
2.2.3. Government Border Post Agencies and Private Sector
The study team made initial contacts with both the government and private sector stakeholders.
All government, other government and private sector border agencies operating at the border
within the OSBP are formally represented in the JBC governance organ above. The team met
and sought views as part of the focal group discussions from the Trade and Community
Development District Officers all from the three Districts of Ngara (Rusumo/Kabanga), Missenyi
(Mutukula) and Kajiado (Namanga); and the WICBT/Private Sector Chairperson and Chairman
JBC in the case of Namanga and Mutukula. The Tanzania National Chamber of Commerce
Branch representatives were present as well at Mutukula. The study team’s objective was to
seek free access, inspections and conducting interviews at the four border posts. The regional
consultant led the engagement for direct interviews with all the key informants and respondents.
During the engagement sessions the trade hub concept was introduced by the regional
consultant. This process would then be followed by question and answer session. Feedback
was quickly incorporated into the study. The purpose of introducing the trade hub concept was
to sensitize the key informants, register early their buy-in/comprehension and assess their
immediate feedback/perceptions.
2.2.4. Women ICBT Participation in the Survey
The study team met the WICBT group first and separately as our point of entry and major key
stakeholders in all the border posts. The WICBT survey questionnaire was designed following
the terms of reference to deliberately gauge the respondents’ perception and potential support
towards the trade hub. The involvement and participation exercise by the Women groups’
members and their executive committee members meant that their views would be incorporated
as well but also start to own the trade hub project. In each case, respondents were assembled
in a central but relaxed meeting venue to participate conveniently and freely.
During the meeting and before administration of the questionnaire to the targeted focal
respondents was done, the National Coordinator would introduce the purpose of the visit. He
would then ask the representative from the Trade Support Institution (TSI) – TANTRADE, to
share the purpose and intentions of the ITC/WICBT project in the country and EAC region. The
Women groups chairpersons and their committee members would make brief comments on
their status, current roles and grouping or/and association activities. The regional consultant
would then introduce the trade hub concept where upon questions and answer session would
follow. The whole exercise would be conducted in English and translated by the team’s
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coordinator into the commonly spoken language i.e. Kiswahili, to enable the respondents
understands the questions and bridge any possible language barrier gaps. Throughout the
engagement the women’s needs assessment in terms of expected trade hub and human
resource capacity to operate the hub would be determined.
2.2.5. Key Informant Group Interviews
The guided Key Informants Group (KIG) interviewing sessions in every border post were
conducted into two separate focus groups. The purpose of interviewing the two groups
separately was intended to set the ground free of expression and any perceived influence from
the JBC. The first group consisted of the leadership of the Women ICBT groups for Mutukula,
Kabanga, Namanga and Rusumo7
. The Women association leaders as KIG8
brought forth their
views and feedback about the new concept of trade hub and how they expected it to benefit
them. The questions were read from preprinted questionnaires and explanations were made in
Kiswahili for items or words that were difficult to respondents.
The second group referred to each of the border agencies’ heads of stations that comprises the
JBC. The key participants consisted of the Chairperson for the JBC existing at border posts, the
Immigration station head and the private sector chairperson. In all instances, respondents were
assured of confidentiality throughout the session and thereafter. We would seek to get
imports/exports’ volume data at each border post from Customs Authorities. The interviewers’
roles were to ask only the relevant questions from the questionnaire to the informants and
record responses at the same time. Information accruing was concurrently recorded in order to
aid analysis for subsequent draft and final reports.
2.2.6. Inspection of the border post
A guided tour and inspection would then follow after meeting the Joint Border Committee and
Women group leaders. The inspection was intended to identify the strategic location for Trade
Hub on either inside of the existing One Stop Border Post (OSBP) facility or outside it. All the
JBC Chairpersons were non-committal other than goodwill promises to confirm availability of
space inside the OSBP. The study team was taken on a guided inspection tour by the
chairperson or his representative to identify any possible premises for rent or any piece of land
for acquiring privately from individual owners in the surrounding border town centers. Most JBC
Chairpersons appeared promising to consider the WICBT associations’ applications for
occupancy after the OSBP facilities have been officially commissioned and gone through all the
necessary formalities. TANTRADE in conjunction with women groups’ chairpersons should take
on the responsibility of continued engagement with JBCs’ to ensure space allocation inside
OSBPs is secured and formally confirmed. The idea of acquiring the piece of land came through
to inform the future decision of having a permanent place for placement of a container,
fabricated office or physical construction as the case may be or warrant.
3.0. KEY FINDINGS FROM THE FEASIBILITY STUDY
3.1. Assessment of Border Posts for Trade Hubs in Tanzania
The assessment and selection of four border posts were done based on the immediate needs
and considerations of both the intended beneficiaries and sponsoring agency regarding
prioritizing the most appropriate locations for piloting and subsequently establishing the trade
7
The Women Groups at Mutukula and Kabanga were not yet formally registered but had made progress with the draft constitution making
process with the district authorities. At Namanga and Rusumo, Women Groups were yet to initiate the process of registration. The final
registration process in either case will be completed by the civil authorities at the district and in Dar by issuing certificates.
8
The list of key informants is presented in the appendix II.
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hubs. We developed a prioritization scale where 1 = very feasible, 2= feasible, 3= less feasible
and 4= not feasible with weighted strength from 1 as the very feasible to 4 as not feasible see
section 3.2 matrix below. The scores were against the set criteria as provided in the terms of
reference. We coupled this selective method with the knowledge from the previous phase 1 and
the on-going trade facilitation project work done in phase 2 at the four border posts of Mutukula,
Namanga, Rusumo and Kabanga in 2012 and 2014. Both phases resulted into several
important outcomes of immediate benefit to the women ICBTs in the community but more
specifically Tanzania. During the first phase in 2012, related efforts resulted into some
significant achievements. For instance, formation of women ICBT associations at the borders,
establishment of capacity trade hubs at the Mutukula and Busia borders in Uganda, training
aids/ manuals to improve women’s capacity to comply with customs and border processes,
guides on formal cross-border trade and how to transition from informal to formal status,
guidelines for setting up and sustaining Women ICBT trade associations. This background
information guided the assessment and scoring basis premised on the terms of reference upon
each the border posts below. The findings and outcomes are follows is the next sections.
3.1.1. Mutukula Border Post
Mutukula border post is one of the entry / exit border posts that link the community from Uganda
to Tanzania with a recently constructed OSBP facility pending commissioning (Figure 1).
Mutukula border and its township is situated in Kagera region and administered by Missenyi
District Headquarters (Figure 2). It is here that all authorization to visit and access the border
post is secured and any administrative services required by the Women groups regarding
registration and licensing into an association is obtained.
Fig 1-Mutukula Border Post – New OSBP Facility Fig 2- Missenyi District Hqtrs that authorized visit to Mutukula
The guided tour to conduct an inventory of existing infrastructures that can facilitate the
establishment of the hub with the border agencies and women leaders was done. During the
tour, we identified various locations suitable for the trade hub especially the renting outside the
OSBP facility option (figure 3). We established availability of grid and stable electricity supply,
internet and telephony communications networks. The OSBP facility is anticipated to cut-off the
town communities and its premises upon commissioning other the passenger gates which will
necessitate outside location of the trade hub capacity building functions.
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Fig 3: Guided tour of stakeholders to identify trade hub location Fig 4: Customs Parking Yard with traffic for Imports/Exports
While meeting the border agencies, issues of conforming to the designated procedures and
services available to WICBTs were discussed. According to Customs, Mutukula border post
handles 5% share of imports volumes and 12% of export volumes to the community (table 2).
The cross border transit traffic has increased tremendously from 15 to 60 daily in the last two
years as a result of reconstruction to all-new tarmac road networks from Dar es Salaam port
(figure 4 & JBC). On average of 400 – 500 ICBTs are estimated to cross the border daily.
Through modernization projects, systems and processes have been simplified through
increased automation and online declaration services for women. The Immigration officer on his
part confirmed provision of convenient temporary movement passes to local residents wishing
to crossing to Uganda. This entry/exit pass is free and is valid for up to two weeks. Local
residents from Uganda had to pay a small fee (Tshs 2, 500) for such a temporary pass to get to
Bunazi local market 25km inland Tanzania instead. This was confirmed by the JBC (figure 5).
Fig 5- Meeting with the JBC representatives at Customs office Fig 6- Mutukula MUWOTA Women Group in FGD
We established during the FGD (figure 6) that the Women group at this border post had
previously benefitted in the phase 1 and now 2 project outcomes especially the training to
improve women’s capacity to comply with customs and border processes, using the established
capacity trade hub at the Mutukula border –Ugandan side and formation of their women ICBT
associations. Missenyi District’s Regional Development Plan already supports and promotes all
Women and youth groups in the region. The District officials supported and encouraged women
traders use their MUWOTA platform to apply and secure some lock-ups for their members in the
on-going construction of a Cross Border Trade Market Complex. It is expected to host shops, a
market, lodges, restaurants and offices. The Chairperson of the Joint Border Committee urged
the MUWOTA Chairperson to approach him for consideration on space allocation after the due
process of registration is completed. Mutukula overall scores highest on the prioritization scale
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(section 3.2 matrix below). MUWOTA- Women Group was found to be most prepared within a
period less than six months to support establishment of the trade hub.
3.1.2. Kabanga Border Post
Kabanga border post is one of the main export and transit traffic ports that link Tanzania to
Burundi. The border post is the latest in the development of the OSBP facility and concept
slightly behind the other three in completion. Kabanga border post and its neighboring township
is situated in Kagera region and administered by Ngara District Headquarters (Figure 2). It is
here at the office of District Director that all authorization to visit and access the border post is
secured and any administrative services required by the Women groups regarding registration
and licensing into an association is obtained.
Fig 7: Kabanga New OSBP Facility under construction Fig 8: Ngara District Headquarters – Director’s Office
The Immigration Officer in Charge, representing the chairperson JBC conducted a guided tour
for the team to ascertain an inventory of existing infrastructures that can facilitate the
establishment of the hub. We visited the new site of OSBP where all the government agencies
will shift soon after commissioning of the facility. According to the JBC, the old structures will be
retained for any auxiliary needs and services since they belong to government. However, there
was a possibility to have some space in the new OSBP facility on first come first serve basis for
the private sector. The team visited the OSBP service center on Burundi side where Tanzania
agency officials were sharing the same facility with Burundian officials (figure 9). In this
arrangement, we were told that a few WICBTs have started coming from Tanzania and stop
once for declaration and release of their cargo. On our return journey from Burundi, we sighted
the on-going construction of a Cross Border Trade Market Complex opposite the new Kabanga
OSBP facility, which will host shops, a market, lodges, restaurants and offices. JBC further
advised the women group leader to make early contacts with the District administration
authorities to book space for the trade hub office and market stalls for their members. There
was evidence of many private premises for renting out adjacent to customs old buildings and
within Kabanga Township. Unfortunately, the premises are located more than 500 meters away
from Customs offices and even further away 1km from the new OSBP facility to adequately
serve as rentals for establishing trade hub. The border post is well served and connected with
utilities infrastructure such as stable grid electric power; internet connectivity is by private
telecom service providers and mobile telephones (figure 10).
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Fig 9- OSBP juxtaposed TRA office in Burundi Fig 10- Grid Electricity & Telecom at Customs Office
The study team met the border agencies and private sector representatives at the Customs
office. There were high expectations of shifting to the new facility all government agencies to sit
under one-roof with their Burundian counter-parts when completed perhaps by early next year
2015. According to Customs, Kabanga border post handles 25% share of exports volumes to
the community to Burundi and less than 1% share of imports from the community from Kobero –
Burundi (table 2). The border transit and export traffic exits close to 2,500 cargo trucks and
passenger vehicles every month. On average 100 - 200 ICBTs are estimated to cross the
border daily on peak/ market days on Thursday to Muyinga 15km from Kobero border post in
Burundi.
Our tour guide pointed out some challenges WICBTs may face due to uncontrolled and illegal
migration of people from each side of the country. There is no a natural barrier on either side of
the border and between the two OSBP facilities with more than 2 kms stretch of free and No-
Man’s land. This would-be No-Man’s - Land is currently getting occupied fast by settlements,
residential and commercial premises developments under construction. The Kabanga
Immigration office provides temporary border movement passes to local residents to cross to
Burundi especially on market days.
Fig 11-Kabanga Women Group in FGD Fig 12- Meeting Ag Chairperson JBC
During the FGD with Kabanga Women Group (figure 11) some women members indicated that
they had previously benefitted in the phase 1 and now 2 project outcomes especially the training
to improve women’s capacity to comply with customs and border processes and formation of
their women ICBT associations. Ngara District Community Development Office is already
supporting the drafting of the Women ICBT constitution making process. On the prioritization
scale, Kabanga Women Group becomes overall second with a shorter period of readiness (nine
months) before the trade hub is established.
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3.1.3. Namanga Border Post
Namanga is the main point of entry / exit that link Tanzania and Kenya (figure 19). This border
post is a politically and economically significant for inter-trading activities across the gates
between the two countries – Kenya and Tanzania. Locally, the border post is located between
the Longido district (Tanzania) and the Kajiado County (Kenya) and represents the major shift of
improved infrastructure to the recent construction of the One Stop Border Post facility (figure
20). However, it is awaiting their Kenyan counter-part OSBP facility construction to get
completed in order to commence full-scale juxtaposed operations.
Fig 19- Border Agencies’ Offices Opposite OSBP facility still in use Fig 20- OSBP Facility with Imports/Exports trucks
During the station outdoor inspection, we observed that behind the main road leading to the exit
entry there is vibrant and blend of formal and informal business establishments and trading
activities. This part of town is already curved out by the constructed fence with the impending
commencement of OSBP juxtaposed operations soon (fig 20). OSBP infrastructure limits
access by the original border residents and any settlements outside it. Placement of the trade
hub will have to consider two-part location; one part inside to deal with such services as
customer care, advocacy and trade information. The rest of the services such as capacity
building and training is most suitable to locate in the curved out town area. The border post
handles 54% share of the import volumes originating through community border posts; and 35%
share of export volumes to the community (table 2). Averages of 300 – 400 ICBTs are
estimated to cross the border daily (JBC). According to the private sector chairperson and the
Women group leader, up to an estimated 400 people cross the border daily. Another estimated
60% (250) belong to cross border traders originating from as far as Arusha and Nairobi.
However, the WICBTs are just considering themselves to get organized and form into formal
association. At the time of our visit, a group of Women led by its chairperson Sara Keiya were in
the process of associating to start registering their association titled Namanga WICBTA with the
district authorities at Longido. The membership was at 21 strong and still growing. This group is
the future WICBT at this border post for dealing with in the trade hub project (figure 21 & 22).
Fig 21- Namanga WICBT group in FGD session Fig 22- Study team visiting a WICBT member’s shop
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The trade hub concept was introduced to both the border agencies and WICBT group situated
at Namanga (fig 21). The Women Group will require sustainable assistance during the gestation
period of one year. Therefore this puts Namanga border post in the third priority slot on
prioritization scale and for the pilot to establish a trade hub. It will have a hold up phase till the
growth path of Namanga Women Group development and formation into a WICBT association
is attained.
3.1.4. Rusumo Border Post
Rusumo border post is one of the key transit and export ports that link Tanzania and Rwanda
(figure 13-14), with a near completion OSBP facility (Figure 15). Rusumo border and its
township is situated in Kagera region and administered by Missenyi District Headquarters
(Figure 2). It is here that authorization to visit and access the border post was obtained. The
community development officer Helen Mkongwa notified that any administrative services
required by the Women groups regarding registration and licensing into an association is done
by the district authorities. The border agencies still occupy a temporary shelter which
accommodates all border agencies’ offices (figure 14).
Fig 13-Rusumo border post Fig 14- Current Border Agencies Office Fig 15- New OSBP facility due for Completion
The port is one of the near completed OSBP facilities (figure 15) and already handles 22%
share of export volumes to the community through Rusumo – Rwanda, and less than 1% share
of imports from the community (see table 2). It exits an estimated 100 transit cargo trucks less
passenger cars/buses on average and 60 ICBTs are estimated to cross the border daily.
Challenges include location of the border post situated along a very steep ridge, wide River
Rusumo and narrow bridge that marks the boundary between Rwanda and Tanzania. There is a
huge difficult for settlements and residential and commercial premises to conveniently get
constructed and expand. The OSBP facility has already been cut-off from the neighbouring
town community with the fencing around it. There is a JBC headed by Customs to coordinate all
border activities. The Rusumo Immigration Office fully-pledged to provide border movement
passes to local residents to attend market days in Rwanda.
Fig 16-Rusumo WICBT members in FGD Fig 17-Inspection with border agencies Fig 18- Electricity and Water are available
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Ngara District Community Development Office is ready to support and promote Rusumo
Women Groups in the registration process if they present themselves for assistance. There is
no border market on the Tanzanian side; instead it is located at the Rwandese side. Rusumo
JBC has mandate to consider space allocation or not to the trade hub. “The Chairperson of the
Joint Border Committee - Customs urged the Chairperson WICBT to approach him for
consideration on space allocation after the due process of registration is completed”. Another
estimated 80 – 100 ICBTs cross on Tuesdays, Thursdays and Fridays which are market days to
the border market located at Rwanda side (JBC & figure 14). During the visit the trade hub
concept was introduced to the border agencies. A consultative meeting with border agencies
was held and later an inspection conducted (fig 17). We found no clear buildings and space to
rent or put a trade hub facility (container, etc.). Other infrastructural facilities such as electricity
(including stand-by generator), telephone, internet (Telecom modems) were seen to be
available and in place (figure 18). Therefore this puts Rusumo at a hold up phase9
till the
Rusumo Women Group has registered and under gone capacity building arrangements
favourable for the piloting the establishing the trade hub are in place. It becomes fourth on the
prioritization scale for the pilot considerations.
3.2. Prioritizing the Border Posts for Establishing Trade Hubs
Prioritizing the border posts in Tanzania was based on the five parts criteria therein the matrix
below and in accordance with the terms of reference provided. The findings that are unique
have been segregated and scored against the respective border posts. There are those that are
cross-cutting across the criteria have been merged into one theme. The following section
presents summary findings of the four studied border posts for establishing trade hubs in
tabulated format.
ITEMS RUSUMO KABANGA NAMANGA MUTUKULA
Part I: Prioritize the border post in which to establish the trade hub on the basis of:
a). Volumes of
imports that
come from the
neighboring
country (s)
The volumes of
imports that come
through Rusumo
border post in
Rwanda stands at
1,091 tons valued at
CIF $1,521,073 (see
table 2).
The Import volumes that
originate through
Kobero border post in
Burundi were
established to be low at
85 tons valued at CIF
$425,539 (see table 2).
The trade import
volumes from
Kenya and
Mombasa through
Namanga border
post in Kenya
stands at 124,384
tons valued at
215,538,852 in
2013 (table 2
below).
The general goods from
the community that come
through Mutukula post in
Uganda stands at 44,303
tons valued at 18,936,275
in 2013 (table 2 below).
Table 2: TANZANIA IMPORTS AND EXPORTS THROUGH EAC KEY BORDER POSTS IN THE FINANCIAL YEAR 2013/14.
ITEM COUNTR
Y
ANNUAL
VOLUME
S
RUSUMO KABANGA NAMANGA MUTUKULA
UNITS/YE
AR
2013/14
CIF (USD) CIF
(USD)
Net
Weight
(KG)
CIF
(USD)
Net
Weight
(KG)
CIF
(USD)
Net
Weight
(KG)
CIF
(USD)
Net
Weight
(KG)
GENERAL
IMPORTS
397,025,9
08*
1,521,07
3
1,091,08
3
423,539 85,491 215,538,8
52
124,384,4
92
18,936,2
75
44,303,8
61
% Share 1 or 1or < 54 5
9
Hold up phase in the context of this study is the transition period through which a WICBT/MSME group will take to grow and attain capacity to manage
the pilot of establishing a trade hub at the designated border post. The period in the case of Tanzania could up to one year for all border posts.
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of total
volumes
<0.05 0.01
DOMESTI
C
EXPORTS
421,613,8
40*
91,050,9
19
85,044,4
16
105,424,5
39
138,658,4
28
146,269,3
93
160,530,5
96
49,255,3
42
35,244,3
32
% Share
of total
volumes
22 25 35 12
Source: Authors compilation based on TRA Annual statistics for all commodities of general Imports and domestic exports
through community ports for the FY ending 2013
** Import and export volume figures include other community border posts e.g. Sirali, Holoholo, Holili, Marongo, Tarakea,
etc.
NB: The trade volumes for imports/exports above were not possible to segregate them into determining the portions that
related to WICBTs business and other trading entities/activities.
Score on scale* 3 4 1 2
b). Volumes of
exports that
cross border to
the neighboring
country (s)
The volumes of
domestic exports
destined through
Rusumo border post
to Rwanda stands at
85,045 tons valued
at CIF $91,050,919
(see table 2).
The volumes of
domestic exports that
are destined to
community through
Kabanga border post to
Burundi stands at
138,659 tons valued at
CIF $105,424,539 (see
table 2).
The volumes of
domestic exports
that are destined
through Namanga
border post to
Kenya stands at
160,531 tons
valued at CIF
$146,269,393
(see table 2).
The volumes of domestic
exports that are destined
through Mutukula border
post to Uganda stands at
35,245 tons valued at CIF
$49,255,342 (see table 2).
Score on scale* 3 2 1 4
c). Volumes of
trade exchanges
by WICBTs (as
Associations
or/and
Individuals on
both sides) at
this border
crossing from
the
neighboring?
Rusumo Women
Group members are
active in cross
border trade during
the market days on
Tuesdays,
Thursdays and
Fridays. There are
not specific trade
exchanges known to
take place both at
an individual or
group levels.
Their counter-part
WICBTs in Rwanda
were said to
organize into
cooperative
societies. “This level
of organization
makes it easy for us
to access and buy
goods from them”
commented Pendo
Bolingo a WICBT
the chairperson.
Kabanga Women Group
conducts their
businesses on an
individual basis. This
implied that when there
are any trade
exchanges or it is not
easy to tell or get to
know. Any transactions
of this nature are
entirely private and
unrecorded.
Namanga Women
Group has no
known trade
exchanges either
as a group or as
individuals.
According to Sara
Keiya the leader
of the Women
Group, “there are
could be
cultural/social
exchanges on
some goods/items
that are
communal but
dependent on
individual
relationship and
common practices
of extending
sales/barter trade
schemes. It is not
possible to
ascertain the
volumes of trade
exchanges”.
Women Group
members in the
FGD further
added that:-
-There are not
records kept by
the associations
- Transactions are
individualized
confidential and
not easy to
ascertain.
-On average a
WICBT makes 15
MUWOTA is comprised of
both WICBT and MSME
traders. Majority of MSMEs
have capacity to deal
directly with their counter-
part association members
in Uganda.
These are Women ICBTs
that own shops, schools,
bakeries, market lock-ups
and stores where they
base themselves to run
their cross-border trade
The Chairperson Benuza
Jane admitted, “that some
level of goods exchanges
may be taking place but it
is not easy to know let
alone record”. She is
currently a dual
chairperson of both
WICBTs associations.
On average 10-12 trips are
made by MSME Woman
trader and 1-2 times a day
for WICBT either exporting
or importing/bringing in
commodities.
No data on volumes of
exchange = Less feasible -
3
INT/71/14A Trade facilitation for women informal cross-border traders and MSMEs in the East
African Community - phase II
transactions every
month trading in
cattle and milk
products selling
them to Kenya.
- Cross border
trade by WICBT is
characterized by
perishable
commodities such
as tomatoes, milk,
bananas, and
onions.
Score on scale* 3 3 3 3
d). Presence of
WICBTs’
associations are
at the border or
proximity
There were no
presences of other
known WICBTs
associations either
at the border post or
in the proximity at
Ngara Town, save
for Rusumo Women
Group.
There is VICOBA - a
micro-institution
branch in Ngara and
its headquarters in
Dar. VICOBA has 30
members some of
whom belong to
Rusumo Women
Group. They meet
together with other
non-members to
apply and receive
loans weekly with a
5% quarterly
interest.
Scale No draft copy
of the constitution=
Not feasible- 3
At Kabanga border post
only Kabanga Women
Group exists. Helen
Mkongwa, a trade
development officer who
supervises both
Kabanga and Rusumo
areas in Ngara District
confirmed that there
only two WICBT groups
known and getting
registered with her
office. All the groups are
located at the border
posts.
Draft copy of the
constitution =Feasible- 2
-The Namanga
Women Group
leader – Sara
Keiya had this to
say, “There are a
few women who
know about formal
Women ICBT
associations and
these are mainly
from Mutukula
and the
surrounding
areas. They also
have heard about
them in countries
like Uganda, but
have not yet seen
them operate in
Tanzania”.
-Namanga border
post has no
WICBT formalized
group or
association known
as yet. Namanga
WICBT group that
we held a meeting
with is still
informal and
unregistered
neither by
themselves nor by
the Namanga
town council or
Longido District.
-There were no
other WICBT
groups or
associations that
were known to be
in the proximity or
exist within the
district of Longido
at the moment.
No draft copy of
constitution - 4
At the time of our visit, the
Community Liaison Officer
Anna Ndile confirmed only
MUWOTA as the only
WICBT association related
with WICBTs. The group
has already made a
constitution (see fig 23
below). She attests that it
was pending final
amendments by the
MUWOTA Chairperson
and her executive
committee before they
submit it for onward
approval in Dar for
registration and license
issuance.
Figure 23
-According to the
Development Officer in the
proximity there is Missenyi
District and Town with over
200 other various groups
of Women and youth both
involved in different social
and cultural activities.
Scale: Draft copy of
constitution near
completion = Very
Feasible-1
Score scale* 4 2 4 1
e). Key
challenges the
WICBT group or
association face
RUSUMO WOMEN
GROUP faces the
following concerns
as a group:-
i). The delayed
implementation of
the ITC programme
KABANGA WOMEN
GROUP was found to
face the following issues
as a women group:-
i). The delays in the
implementation of the
ITC programme lead to
NAMANGA
WOMEN GROUP
was considered to
face the following
key challenges:-
i). Their group has
un elected leader
MUTUKULA WICBT
Association - MUWOTA
was found to face the
following concerns to their
association:-
i). The association is led by
a Chairperson – Benuza
INT/71/14A Trade facilitation for women informal cross-border traders and MSMEs in the East
African Community - phase II
lead to most
members
abandoned the initial
association and left
the association. The
current group
membership stands
at 38 members.
ii). All the members
indicated
capitalization for
their projects and
business is the main
problem. VICOBA is
the only government
micro-finance
institution that
comes to their
rescue to assist.
Many conditional
requirements such
as registration
certificate as
collateral for the
group members fails
them.
iii). The Women
Group had not
started registration
processes with
Ngara District
authorities.
vi). Accessing the
simplified certificate
of origin copies for
use by group
members who
intends to export to
Rwanda is very
difficult. A member
is required to travel
to Bukoba or Dar.
This increases the
cost of doing export
business and getting
taxed heavily
including agricultural
products.
iv). Lack of
translations of
common traded
transaction
documents and
circulars from border
agencies in Kiswahili
for their members.
But most members
may be fluent in
speech but very
limited in reading
such communication
which has hampered
their business
opportunities.
Scale: Less Feasible
= 3
members becoming
skeptical and left the
association. Indeed the
membership had
reduced by half from 27
to only 15 members.
However for registration
purposes, a minimum of
12 members are
needed.
ii). There is absence of
sustainable credit
facilities and products to
support group members’
businesses. VICOBA is
a micro-finance
institution that attempts
to assist but has many
demands such as
registration certificate,
collateral products from
group members.
iii). The Women Group
lacks a formal structures
and a place of abode to
cater and provide
answers to inquiries and
concerns from women.
v). Similarly, delayed
formalization and
registration of the
Women Group has
paralyzed a number of
activities and probable
participation in the JBC
activities and meetings
at the border.
vi). There is a difficulty
in obtaining the
simplified certificates of
origin copies for use by
members who intend to
export to Burundi. As a
result every item
exported across the
border is taxed heavily
including agricultural
produce.
and about 21
members. The
Chairperson –
Sara Keiya remain
the main contact
person and her
group is informal
without any a
document with
rules and
guidelines.
ii). They are not
yet recognized
and registered by
the National
Chamber of
Commerce as a
result.
iii). The group is
not permitted to
participate in the
Joint Border
Committee
activities and
meetings.
iv). The Women
group is neither
part of the private
sector forum nor
allowed to
become members
unless they
formalize and
register with the
Longido District
Office.
v). They have not
yet made formal
contacts and
relationships with
the Kenyan
WICBT which was
said to be more
formal and
organized.
vi). Lack capacity
and means/funds
to start the
process of group
formation and
registering into an
association at the
district.
vii). The group
members are
conducting their
ways and
business
transactions on
individual basis
and family
support.
viii). Restricted
movement of
border
communities
especially the
Masai people
(Masai WICBTs)
whose ancestry
Jane Charles who is a
Ugandan resident and
origin. As an individual she
is a university graduate,
widely knowledgeable and
has active business
interests on both sides of
the border. However, in the
long –run it is generating
debate and conflicts as to
whether she should
continue to qualify to hold
two leadership portfolios
for both WICBT
associations in Uganda
and Tanzania.
ii). The current association
that is prominent but
pending formal registration
is called Mutukula
Women Traders
Association (MUWOTA).
The name implies Women
Traders an association of a
certain category of women
that belong to micro, small
and medium enterprises
(MSMEs). The very
informal women cross
border traders feel left out
and not belonging to this
association. The above
underlying concerns are
known to the National
Coordinator and are
already dealing with such
group dynamics till stability
is secured in the process.
iii). The association lacks a
formal office or information
desk that is available to
cater and provide answers
to inquiries and concerns
from women. It is said to
boost of over 48
members.
v). Delayed formalization
and registration of the
association has paralyzed
a number of activities and
probable participation in
the JBC activities and
meetings at the border.
vi). Lack of simplified
documents/copies on the
EAC regional and revised
protocols, laws/ regulations
that are translated in
English and Kiswahili for
their members has
hampered their business
opportunities.
v). women address the
risks they face in their
trade related activities
given that they are typically
more risk averse than men
and respond to risk in
different ways. This reflects
the particular challenges
INT/71/14A Trade facilitation for women informal cross-border traders and MSMEs in the East
African Community - phase II
grazing areas
straddles and
across the two
countries’ frontiers
and only limited to
an official 10 km
distance in-land
on either side
according to
Immigration
officials.
that women face in
participating in trade and
managing enterprises
Score 3 3 3 3
f). Services
Association
provide to
Women
members at the
border
The expected services women members should receive from their associations and groups are
generally:-
- Calling for regular meetings to share on the border activities and understanding transformations
taking place with the introduction and anticipation of OSBP facility service arrangements.
-Arranging venues for regular group meetings at members premises or homes
- Office for their record keeping, documents, stationary and files
- Receive cross border trade related information and data compiled
- Support from each other and making financial contributions for members when faced with
challenging situations for instance when calamities occur, burial arrangements; social assistance
such as community and social events, weeding parties, conduct training workshops,
-Networking center with furniture and equipment to relate effectively with border agencies and
counter-parts in the neighboring country.
-Get services such as internet, photocopying and printing to aid and simplify their business dealings
and knowledge.
Score 2
g). Survey on
the level of
challenges
faced by women
A deliberate random sampling survey was employed to inquire from the WICBT group/association
and other women at Rusumo, Kabanga, Namanga and Mutukula border posts to provide insights at
key seven broad levels of challenges faced by women;
i. Economic and Trade:-
• Women are still experiencing persistent harassment for money, sex or exchange of goods by
some corrupt and unethical border agency officials;
• Most women are not aware of the recent developments of introducing OSBP facilities and with
their associated modernization systems/procedures, border agencies laws and regulations and
this gets used against them, i.e. the impact is more on the informal cross border traders;
• Numerous non-trade barriers (NTBs) are still a prevalent and a serious problem. For instance,
local councils/townships fees/charges/levies and the parking fees introduced by the Longido
(Namanga), Missenyi (Mutukula) and Ngara (Kabanga/Rusumo) Districts, police stoppages
demanding bribes, etc.
• Challenges associated with management of SPS and lack of trade facilitation push traders to
use informal routes. Many unnecessary clearance procedures were cited which resulted in long
waiting times, such as the scanning and issuance of requisite documents for agricultural/animal
produce. Some trucks had to stay at the border post for up to 2-3 days. These goods generally
require SPS and veterinary certificates. SPS measures are regulations for food safety, animal
and plant health standards which aim at enhancing consumer welfare through consumption of
safe food products. SPS certificates are obtainable from distant district headquarters of Bukoba,
Arusha or Dar-es-Salaam. Tradable goods (i.e. tomatoes/bananas) are usually ready for the
market at the point they are being ferried across the border. Due to the perishable nature of the
goods, the mode of transportation is generally trucks and the consignments could be for
different cross border traders using pooled transport.
• Competition from counter-part WICBT members in Kenya, Rwanda, Uganda and Burundi on the
account of Duty remission schemes and unfair tax regulations. NB: - Tanzania follows both the
EAC & SADC tax regimes. This means there some contested commodities that will not enjoy
duty remissions/tariff exemptions and other EAC partner states will not honor at all e.g. Rice
and Sugar.
ii. Political:-
The configuration and atmosphere in neighboring countries politics is varied and not commensurate
with the cultural norms and social cohesion in Tanzania. For instance, WICBT allege encountering
mistreatment by some border agencies’ officials whenever they travel to Kenya and Rwanda to sell
or purchase commodities. Uganda was said to be fairly flexible in treatment with issuance of a chit
that should last one day to have returned back into Tanzania. Rwanda is non-compromising on non-
regulatory practices and conduct by some ICBTs. Imposes restrictions and controls to the mass flow
of the traders with multiple tradable merchandize crossing on market days. Some Customs officials
in OBR - Burundi were said to impose levies/taxes on every import whatever quantity and description
of commodities crossing the border where they are not supported by documentations from the
country of origin.
INT/71/14A Trade facilitation for women informal cross-border traders and MSMEs in the East
African Community - phase II
iii. Financing:-
• Levels of securing credit and soft loans for doing business and expanding their business
volumes and lines has remained limited and scarce with women groups at Rusumo, Kabanga,
Mutukula and Namanga. There are few women ICBT groups who have afforded to secure loans
from banks or Microfinance institutions such as VICOBA10
. However, many of WICBT who fail
to get but still need loans have resorted to borrowing from friends, colleagues or family
members. This process manifests with its own limitations such as failing to raise enough
funding needed as well as destroying friendships once there are delays or fails to pay back the
borrowed money.
• A few of WICBT groups have come up with the idea of cash-round groups, which are a form of
rotational groups in which members regularly pool resources and give everything to one
members until each member has had their turn. This method is proving to work for the women
and they hope to improve these groups and formalize them.
• Mrs. Ndile Anna a Social Welfare Officer in the Community Development Office at Missenyi
District Council made this observation: “There is generally lack of capital for women traders. We
have tried to extend short-term loans to Women both old and young, but these loans are small.
We have over 200 groups in the whole District, including other youth groups and so we only
give to 6-10 groups, depending upon what the government can handle.”
iv. Social: - “There are some levels of discrimination and unfair treatment when one is conducting
cross border trading in the neighboring Kenya and Uganda” claims one Florida a ICBT member. In
Kenya for instance, Masai informal traders are harassed when they cross further inland into Kenya
without any formal documentation to sell or buy milk and other cattle products. Tanzania Immigration
claims that they allow their Kenyan Masai counter-parts a 10 km free zone kind of trade but this is
not reciprocated by Kenya on the Tanzania Masai. Furthermore, there are levels of language barriers
mainly on English that is used on official documents and daily communication in Kenya and Uganda.
Some border communities for example Masai don’t speak Swahili at all or fluently which is an official
dialect in Tanzania. The Tanzania education system was said to emphasis Kiswahili as a mode of
instruction and teaching in most primary schools and English is introduced at secondary levels. This
implies that most primary leaving graduates will communicate, write and transact in Kiswahili.
v. Cultural: - The border post frontiers are inhabited by tribes/communities that share same
language dialects and cultural backgrounds. Both communities share a high level of cultural bonding
and inter-marriages. Almost all border communities/tribes such as Masai, Urundi and Rwandese cut-
across the border lines and extend into Kenya, Burundi and Rwanda respectively. This implies that
cross border regulatory regimes are considered interruptive to their social standing and harmony.
vi. Technological:- Limited or lack of ICT knowledge and skills on both sides Burundi, Kenya,
Uganda and Rwanda to conduct business with computers, internet and smart telephones. There is
urgency to introduce computer related skills from the project design to implementation. The trade
hub will be operated on the ICT platform in order to deliver real-time services. It will also create a
quick/easy means to transact with border agencies which are already using high-tech to provide
down-loads to ASY-World application, clearance service messages - SMS.
Score 3
h). Level of
resistance to
change of the
agents of the
border
agencies.
The level of resistance to change by the border agencies’ officials had a common thread cutting
across all the border posts at Rusumo, Kabanga, Namanga and Mutukula to be:-
i. Attitudes of maintaining the status quo and order by border agencies was said to be prevalent.
ii. Indifference to the plight, suffering and difficulties experienced by Women traders is a common
occurrence.
iii. New technologies, reforms, procedures/ processes introduced through institutional reforms to
cause simplified, clarified and transparent trade regimes are disregarded or implemented in peace
meals. For instance, the EAC Simplified certificate of origin value threshold of CIF $2000 is still not
yet implemented but instead CIF $500 is applied on the basis of lack of COO documentation.
iv. Lack of knowledge and respect of gender issues segregated and peculiar for Women, Men and
Children operating at these border posts.
v. High focus and overzealous on tax collection by Customs without any reasonable concern and
understanding about women concerns and questions that beg answers/explanations during the
process of trade transactions and tax assessments.
Score 2
Part II. Visit the border agencies to introduce the project and identify the best place to establish the trade hub:
a). Identify
opportunities
for networking
between trade
hub agents and
customs agents
at border
The following networking opportunities would obtain for Trade Hub Agents (THA) at both border
posts of Rusumo, Kabanga, Namanga and Mutukula:-
- The national WICBT association should apply to TRA – Customs to secure the licences of
offering clearing services. Then the national WICBT would register their membership with
clearing fraternity both at their head office and border posts. Then WICBT associations at
border posts would be eligible to assist their members and extend clearing services to all
interested ICBTs.
10
VOCBA is a national micro-financing institution that assist and enable low income earners and groups to access low interest financing.
INT/71/14A Trade facilitation for women informal cross-border traders and MSMEs in the East
African Community - phase II
- Being a member of the customs agents’ fraternity may create further multiplier opportunities
such as sharing or using the agents’ office counter within the OSBP facility as ‘a point of sale or
help-desk’ for the WICBT members. Note that as matter of JBC border governance policy,
WICBT in their current state don’t qualify to have space within the OSBP.
- There are more cooperation and linkage opportunities to quickly interface with Customs Agents
Clearing Associations and their members.
- Polite Customs agents are most likely to extend support to the trade hub agent and also aid
WICBT members in the process of clearances across border once WICBT associations become
formal and attained membership to customs agents associations.
- Interaction and network opportunities for women would increase to get familiar and assisted by
their cross border counter-part trade hubs and customs agents, WICBT associations in
smoothening coordination with each other in the community (EAC) neighbours.
- Trade hub agents would be enabled to enjoy the benefits of interconnectivity, border
management, modernization and collaboration with the existing automated border agencies.
Score 2
b). Identify
agreement
opportunities to
provide women
facilities in local
customs for the
provision of
services with
support of
experts /
agencies
A number of the agreement opportunities have been identified for the local customs to agree to
provide services with support of agencies. These includes:-
- TRA – Customs welcomes a legal entity and encourages such associations to enter discussions
of mutual agreement that may lead to signing an MOU. The MOU would qualify for
interconnectivity and user rights for TANCIS system for purposes of getting the Trade Hub
connected onto their e-Customs clearance system and network.
- The JBCs encourages individual WICBT associations at their locations to make a formal
application for membership and recognition. The positive approval opens the possibility of
getting WICBT leadership represented on the JBC governance structures at every designated
OSBP border post.
- JBC Chairpersons would always invite WICBT association members to participate with other
OGA’s during their sensitization sessions and key meetings.
- Customs was also interested in playing a key role of involving the WICBT members in their
regular public-private sensitization sessions in accordance with their calendar of activities.
Reciprocal invitations by the WICBT Associations would be extended to border agencies for
their functions.
- Provision and putting up the notice board the list of EAC sensitive commodities that reflect tariff
free components, VAT able commodities and exemption/remission regimes translated in three
languages English and Kiswahili.
- ITC should be persuaded to fund the Trade Hub project for the next two years (2015/2016) till
capacity in management and operationalizing the trade hub is achieved by WICBT
- Other Strategic Partners: Cross-Border local governments; relevant sector National Ministries (
e.g. Other Trade Support Institutions, Local NGOs, Trade, Internal Affairs), Customs administrations
and Revenue Authorities, EAC Secretariat, GIZ, JICA, European Commission, UNDP, USAID, WB
and TMEA.
Score 2
Part III. Conduct an inventory of existing infrastructures that can facilitate the establishment of the hub:
a). Premises
available for
Trade Hub
Rusumo border post
has a near-complete
construction of the
OSBP facility. The
external proximity of
the OSBP facility is
sprawling town with
highly built but
modest commercial
and residential
structures. The town
is crammed onto a
narrow and steep
sloping landscape.
The existing facilities
are fully occupied
and rented highly
compared to other
townships. It
possible to negotiate
for rented premises
that can serve the
purpose for
establishing the
trade hub (see
Fig24).
Kabanga border post is
undergoing massive
reconstruction on a new
site and location into an
OSBP facility. The new
location is about 1.5 km
away from Kabanga
trading center and 1 km
from the old Customs
offices. There are plenty
of premises in the town
center and just opposite
the old customs offices
(see fig 25) but with
such a walking distance.
Therefore, such a
distance will favor the
‘trade hub outside’ the
OSBP facility. The
planned ‘entry inside’
the OSBP facility must
start now so that by the
time the facility is ready
for entry early next year,
WICBT with also have
gotten prepared
“The Chairperson of the
Namanga border
post and its
township are well
developed to
secure any
amount premises
needed. The fig
26 below is one
section of the
street road off the
main road. OSBP
development has
spurred further
growth and
expansion on the
town that has
attracted both
commercial and
residential units to
spring up.
Therefore
depending on the
option of acquiring
the premises for
the trade hub,
there are many
houses potential
Mutukula border post on
the other hand is equally
structured similarly like
Namanga. There is a fully
completed OSBP facility
simply waiting
commissioning anytime the
juxtaposed facility on the
Ugandan side is
completed. The external
proximity of the OSBP
especially the opposite
side is sprawling town with
highly built commercial and
residential structures to
serve every option decided
(renting to purchase) on
establishing a trade hub
(see fig 27).
During the joint meeting we
held with the joint border
committee chairperson and
head of Immigration, he
acknowledged the active
participation of the WICBT
members. Fortunately, the
WICBT at Mutukula is
INT/71/14A Trade facilitation for women informal cross-border traders and MSMEs in the East
African Community - phase II
Fig: 24
JBC extended the
promise to the Women
ICBT Chairperson to
approach him for
consideration on space
allocation after the
completion and opening
of the OSBP facility”.
Fig: 25
for renting (other
options) both at
nearby the OSBP
premises and
adjacent the road
within a radius of
100 meter’s.
The JBC
chairperson
indicated that “the
absence of any
formal WICBT
group, no space
was provided.
However with the
shift into the new
facility,
possibilities could
be explored”.
Fig: 26
likely to receive a rare
opportunity of being
considered to for space to
host the trade hub if it was
established for piloting.
Fig: 27
Score 2 2 2 2
b). Electricity There is full supply of grid- electricity, solar energy and stand-by generating sets provided by the
OSBP facility projects (see figures 28 and 29 below). That eases possibility of getting connected
after formalities of application to the electricity service providers or JBC utilities unit. There is
occasional loading-shedding that was mentioned which may requires provision of a stand-by
generator or/and solar panels for solar energy installation to power trade hub equipment and lighting.
Fig: 28 Fig: 29 Fig: 30
Score 2
c). Internet
Connection
Throughout the border posts, most of the key agencies especially Customs and Immigration were
found to have their own Wi-Fi connectivity for their local area networks (see figures 29 and 30
above). Mobile Dongos or modems connectivity is also supported by the mobile telecommunications
service providers (Vodacom, Smart & Zantel) for the internet installations. There are also internet
roaming services available almost throughout the country trading/township centers. Most key
agencies such as Customs, Immigration/Police were found to operate local area Internet connections
and networks. It was established that through Mobile Dongos or modems of the Vodacom & Zantel
telecom companies, internet services can be conveniently secured and installed.
Score 2
d). Telephone
Connection
Land-line telephone cables/lines were found dilapidated but existing and not in use. In some border
posts telephone lines were still connected and functioning but not popularly in use (see figure 30
above- common to all border posts). Even those offices with cable telephones that are connected
still prefer to use mobile telephony which is handy and in common usage by all agencies and
WICBTs members. In fact many WICBTs who participated in our FGD were holding mobile
telephone sets. These wireless telecommunications service providers were readily available from
Vodacom and Zantel telephone companies.
Score 2
e). Estimated Operating Costs
At the moment the operations cost of establishing a functional and fully-equipped trade hub is not yet fully guaranteed at any of the four
surveyed all OSBP border posts i.e. Rusumo, Kabanga, Namanga and Mutukula other than promised indications. The two assumed and
estimated start-up costs for scenario (i) & scenario (ii) are based on two premises i.e. operating while inside the OSBP facility at
USD$18,600 and/or outside the OSBP facility at USD$43,700. The additional costs for scenario (ii) is intended to cater for trade hub
services related to capacity building that cannot be conducted while operating inside the OSBP facility
(i). Operating Trade Hub inside the OSBP facility as a central point where women ICBTs/MSMEs can access assistance related to
Final Report ITC-Tanzania FS - Field Findings 11-2014
Final Report ITC-Tanzania FS - Field Findings 11-2014
Final Report ITC-Tanzania FS - Field Findings 11-2014
Final Report ITC-Tanzania FS - Field Findings 11-2014
Final Report ITC-Tanzania FS - Field Findings 11-2014
Final Report ITC-Tanzania FS - Field Findings 11-2014
Final Report ITC-Tanzania FS - Field Findings 11-2014
Final Report ITC-Tanzania FS - Field Findings 11-2014
Final Report ITC-Tanzania FS - Field Findings 11-2014
Final Report ITC-Tanzania FS - Field Findings 11-2014
Final Report ITC-Tanzania FS - Field Findings 11-2014
Final Report ITC-Tanzania FS - Field Findings 11-2014
Final Report ITC-Tanzania FS - Field Findings 11-2014
Final Report ITC-Tanzania FS - Field Findings 11-2014
Final Report ITC-Tanzania FS - Field Findings 11-2014

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Final Report ITC-Tanzania FS - Field Findings 11-2014

  • 1. FINAL REPORT: THE FEASIBILITY STUDY FOR THE ESTABLISHMENT OF CAPACITY TRADE HUBS FOR IMPROVING THE WICBTs/MSMEs BUSINESS ENVIRONMENT IN TANZANIA RUSUMO KABANGA NAMANGA MUTUKULA BORDER POSTS Courtesy: Field photo on Trade volumes across Kabanga/Kobero Border Posts – 2014.
  • 2. INT/71/14A Trade facilitation for women informal cross-border traders and MSMEs in the East African Community - phase II ACKNOWLEDGMENTS The final report1 presents information on the feasibility study for the establishment of the trade hub to solve WICBTs/MSMEs’ existing bottlenecks related to trade facilitation conditions, findings and recommendations thereto at Namanga, Mutukula, Rusumo and Kabanga border posts below. The feasibility study was conducted to inform the decision to provide or not technical assistance in form of establishing Capacity Trade Hubs in the most suitable border post (s). The trade hub facilities conform to the promotion of Trade facilitation for WICBT and MSMEs in the East African Community and as a component of Phase II roll-out project. The Trade Hubs establishment is intended to assist WICBTs overcome the obstacles they face that limit their ability to expand their market share in neighboring countries. The feasibility study would not have been possible without ITC the sponsor of this survey assignment, through Business Environment Section/ Division of Business and Institutional Support, by Ezequiel Guicovsky Lizarraga, Senior Business Development Officer and his dedicated team of colleagues in Geneva - Florian, Beatrice and Uyanga, for their invaluable guidance, coordination and support throughout the whole study. We are indebted to the Tanzania Trade Development Authority (TANTRADE) leadership and managements' support. We thank the Chief Executive Officer Mrs. Jacqueline Maleko -TANTRADE for providing wise counsel during our inception meeting and the District Commissioners for Missenyi and Ngara Districts for their participation during our courtesy calls to authorize us to proceed with the visits. The Regional Consultant expresses his gratitude to the Chairpersons of joint Border Committees (JBC), border station heads of border government agencies of Customs/Immigration at Namanga, Mutukula, Rusumo and Kabanga for their invaluable ideas and guided tours. We are thankful to the Government representatives in the Ministry of Trade and Industry – District Trade Development Officers – Noel Mungure and Helen Mkongwa for Missenyi and Ngara respectively; and Ministry of Gender – Community Development Officers at Missenyi District – Anna Ndile. The Women ICBT Chairpersons and executive members2 of associations/ groups at Namanga, Mutukula, Rusumo and Kabanga are greatly acknowledged for their active participation as key informants and focal groups to respond to the designed questions. The Women participation was central to the quality and credibility of the study findings. My heartfelt gratitude goes to the support field survey team that comprised of special and dedicated individuals by the names of Samuel Billy Mvingire – Director Research and Planning at TANTRADE, Fwalo John - Senior Programme Officer and focal person of the WICBT project and Rogasian Mkenda – National Coordinator for ITC Women ICBT project in Tanzania. Their support and coordination was a mark. Nuwagaba Mbiine Charles International Trade Center - Regional Consultant November 2014. 1 This report is considered final till advised otherwise. Any reviews and discussions (where possible) by clients and relevant stakeholders can be still done. The agreed changes will be subsequently incorporated after the validation workshop into the very last final report. 2 Refer list of names for WICBT/MSMEs association executive members and border agencies who participated in FGD in the appendix 11
  • 3. INT/71/14A Trade facilitation for women informal cross-border traders and MSMEs in the East African Community - phase II Table of Contents ACKNOWLEDGMENTS............................................................................................................. 1 ABBREVIATIONS & ACRONYMS ............................................................................................. 3 EXECUTIVE SUMMARY ........................................................................................................... 4 1.0. INTRODUCTION and BACKGROUND........................................................................... 8 1.1. Background to the Assignment ...........................................................................................8 1.2. Why the Capacity Trade Hub Concept and Study...........................................................8 1.3. Definitions of the Trade Hub Concept................................................................................9 1.4. The purpose of the WICBT Trade Hub................................................................................9 1.5. Capacity Trade Hubs Rationale and Location..................................................................9 1.6. Case Study on West Africa Trade Hub (WATH)......................................................................10 2.0. METHODOLOGY and APPROACH ...................................................................................11 2.1. Visits and Study Selection...........................................................................................................11 2.2. Information and Data Collection Procedure .............................................................................12 3.0. KEY FINDINGS FROM THE FEASIBILITY STUDY ...........................................................14 3.1. Assessment of Border Posts for Trade Hubs in Tanzania.....................................................14 3.2. Prioritizing the Border Posts for Establishing Trade Hubs.....................................................21 4.0. POTENTIAL BENEFITS FROM ESTABLISHING THE TRADE HUB AT BORDER POSTS .....................................................................................................................................36 4.1. General Benefits From Establishing Trade Hubs..........................................................36 4.2. TANTRADE...............................................................................................................................36 4.3. Tanzania Revenue Authority ..................................................................................................37 4.4. EAC and SADC .......................................................................................................................37 5.0. CRITICAL SUCCESS FACTORS FOR ESTABLISHMENT OF ICBT TRADE HUBS....37 6.0. RECOMMENDATIONS ..................................................................................................39 7.0. CONCLUSIONS.............................................................................................................41 8.0. APPENDICES ................................................................................................................42 Appendix 1: Key Informant (KI) Guide Questionnaire ....................................................................42 Appendix 11: Attendance List for WICBT Focal Group Discussion at four Border Posts in Tanzania................................................................................................................................................43
  • 4. INT/71/14A Trade facilitation for women informal cross-border traders and MSMEs in the East African Community - phase II ABBREVIATIONS & ACRONYMS BIC : Border Information Centers BP : Border Post COC : Chamber of Commerce COMESA: Common Market for Eastern and Southern Africa EAC : East African Community EASSI : Eastern African Sub-region Support Initiative of Women FGD : Focused Group Discussions ITC : International Trade Center ICBT : Informal Cross Border Traders JBC : Joint Border Committee KI : Key Informant KWG: Kabanga Women Group MCOC: Mutukula Chamber of Commerce MOHA : Ministry of Home Affairs MOU : Memorandum of Understanding MSME : Macro, Small and Medium Enterprises MUWOTA : Mutukula Women Cross Border Traders Association NTBs : Non-Tariff Barriers NWICBA: Namanga Women Informal Cross Border Association OSBP : One Stop Border Post PS : Prioritization Scale RC : Regional Consultant RWG : Rusumo Women Group SCOO : Simplified Certificate of Origin STR : Simplified Trade Regime TANTRADE: Tanzania Trade Development Authority TNWICBT : Tanzania National Women Informal Cross Border Traders Association TR : Trade Hub TIDC : Trade Information and Data Centers TIDO : Trade Information Desk Organization TIN : Tax Identification Number TPO : Trade Promotion Organisations TRA : Tanzania Revenue Authority TSI : Trade Support Institutions WICBT: Women Informal Cross Border Traders WCBT: Women Cross Border Traders
  • 5. INT/71/14A Trade facilitation for women informal cross-border traders and MSMEs in the East African Community - phase II EXECUTIVE SUMMARY The final report is the last deliverable for the study on the establishment of the trade hubs in Tanzania. The report discusses the findings, and proposes strategic recommendations arising out of the study on each border post of Mutukula, Kabanga, Rusumo and Namanga. The study focused on the prioritizing the border post, identifying the best place, existing infrastructures, women’s needs assessment, human resource capacity to operate the hub: and a review of imports/exports’ volume data as required and stipulated terms of reference. a). The summary findings of the feasible and unfeasible aspects necessary for establishing Trade Hubs at each border post below were premised on the prioritization scale (PS) derived on the criteria set against the terms of reference. Variations in the trade volumes, the formalization and readiness of the women groups and its members are the main ingredients that scale them apart. Mutukula Border Post (i). Mutukula border post scores highest on PS for first priority to pilot and implement a trade hub pilot over the other three borders on the following strength and opportunities as referenced in the matrix under section 3.2:-  It is amongst the growing border posts in Tanzania estimated to import 5% of the national imports from the East African Community (EAC) for 2013 higher than Kabanga and Rusumo (Part 1 – a).  The border post has a completed and spacious OSBP facility ready to host all border agencies upon commissioning. The OSBP operations are pending completion of its juxtaposed one at Ugandan side and is expected to be completed in 2015 (figure 1).  It has an existing Women Group – locally known as MUTUKULA WOMEN CROSS BORDER TRADERS (MUWOTA) with highest numbers of 48 fully registered members of the association and at the exact frontier (Part v –a).  The MUWOTA association has a constitution and it is in the final stages of registration with the District at Missenyi and Ministry of Home Affairs in Dar within 2015 (Part I – d).  It has the lowest estimated time of readiness – up to six months to carry-out the pilot and subsequent implementation of the trade hub (Part iii – f).  It has high potential and available women who may qualify to become experts and train-of- trainers for their fellow members on account of higher levels of education from secondary to university education (Part iv – b).  Exhibited lowest needs of training to develop services for their fellow members (Part iv – c)  It has an association that can become a potential candidate for the trade hub (Part iv – d)  It has on average of 400 – 500 highest members of ICBTs who are estimated to cross the border daily (source: - Mutukula JBC). (ii). Mutukula border post faces some challenges and threats to host a trade hub in the short- run:-  It has the lowest volumes of exports about 12% through Mutukula to the community, which is the lowest of the other three border posts.  Due to the already planned and space allocation within the OSBP facility, the WICBT groups and any other private sector entity don’t have automatic qualification at the moment to access it. JBC will be seen to make up their indicative promises during the study after the OSBPs’ commissioning.  Location of the trade hub outside the OSBP facility would imply that women needs would not be effectively served since one will require exiting the facility first in order to access it.
  • 6. INT/71/14A Trade facilitation for women informal cross-border traders and MSMEs in the East African Community - phase II Whichever way the decision taken by JBC will be, it is critical to consider the dual placement approach of the trade hub both inside and outside the OSBP facility. Kabanga Border Post (i). Kabanga border post would take the second slot against PS to implement a trade hub pilot over the other two borders Namanga and Rusumo on the following strength and opportunities:-  The percentage shared volumes of domestic exports that are destined to the community through Kabanga border post are second highest estimated at 25% (Part 1-b).  Kabanga Women Group has developed the first draft constitution and submitted it to Ngara District authorities for review. Other than MUWOTA of Mutukula, no other border post women group presented any constitution making document.  The estimated time or the implementation of the trade hub is estimated up to a period of nine months (Part 111-f).  Kabanga Women Group was identified as the existing and potential women group associated with informal cross border trading at the time of the visit (Part v- d). (ii). Kabanga border post faces some hurdles and threats to host a trade hub in the short-run:-  The percentage share of import volumes passing through Kabanga border post is estimated at less than 1% originating from the community (Part 1-a).  The existing women group has no capacity at the moment to provide human resource experts. The sampled members at the executive levels indicated to have dropped out from secondary and primary levels of education. External expertise will be necessary (Part 1v-b).  The specific training needs to develop services or women must be tailored and customized to the lower levels of education (Part iv-d).  The OSBP facility is still undergoing construction and may get ready later in 2015. There is still higher uncertainty on permitting operations of the trade hub inside an OSBP facility given the similar conditions and concerns in most other border posts’ facilities.  The Kabanga women group has lost registered members from 27 to the current 15 members (Part 1-e).  There are limited premises readily available in the vicinity or nearest both the old and new sites of the border station. The trading centre is more than 500 metres away from customs and immigration offices.  The piloting and establishing a trade hub prospects at Kabanga border post could be in a hold-up phase3 for nine months till the women group has been registered and members adequately re-tooled and re-grouped. Namanga Border Post (i). Namanga border post is placed in the third slot for consideration for priority to implement a trade hub pilot due to the following strength and opportunities:-  There is a completed structure of OSBP facility ready for commissioning as soon as their juxtaposed complex at the Kenyan side is completed.  The percentage share volumes of trade from or to the community on imports at 54% and exports at 35% are recorded through Namanga as highest amongst the three border posts (Part I - a & b)  There are many private premises and land opposite the OSBP facility to consider options of placement for the trade hub. 3 Hold up phase in the context of this study is the transition period through which a WICBT/MSME group will take to grow and attain capacity to manage the pilot of establishing a trade hub at the designated border post. The period should not exceed two years.
  • 7. INT/71/14A Trade facilitation for women informal cross-border traders and MSMEs in the East African Community - phase II (ii). Namanga border post faces some challenges and threats to host a trade hub in the short- run:-  There is no formal association formed yet. Namanga women group is planning to initiate the process of formalization into a registered association with Longido District authorities (Part iv-d).  The draft constitution consultative and making process has not yet commenced Part i-d).  The sampled members of the executive committee are largely primary level of education graduates.  There was neither apparent nor existing expertise among the WICBT members (Part iv-b).  The low levels of education demands and requires specialized training materials and skills that are tailored to develop services for women (Part iv-c).  The estimated time for the implementation of the trade hub has been put up to 12 months provided the capacity development and registration process are progressed uninterrupted.  Therefore this puts Namanga border post at the holdup phase before piloting the establishment of the trade hub till the growth path of WICBT association formalization (part 111 (f) is attained. Rusumo Border Post (i). Rusumo border post is placed in the last slot for consideration for priority to implement a trade hub pilot due to the following strength and opportunities:-  There is a near completion and well-designed OSBP facility that is expected to be ready for commissioning and occupation in the year 2015.  The percentage share volumes of trade from the community on exports at 22% was recorded through Rusumo as third highest amongst the three border posts (Part I – a & b) (ii). Rusumo border post faces some challenges and threats to host a trade hub in the short- run:-  Rusumo Women Group is yet to initiate the process of formalization into a registered association (Part iv-d)  The draft constitution making and consultative process with women members has not yet commenced Part i-d).  The sampled members of the executive committee are largely primary level of education graduates.  There was no apparent expertise that could be identified among the women members (Part iv-b).  The low levels of education demands specialized training approach, materials and skills to develop services for women (Part iv-c).  There are limited and expensive private premises and land opposite the OSBP facility available for placement of the trade hub. The landscape is a ridge with steep slopes ending into river Rusumo (Part iii – e).  The estimated time for the implementation of the trade hub has been put up to 12 months provided the capacity development and registration process are progressed uninterrupted (Part iii - f). b). Summary Conclusions and Recommendations i. The feasibility of establishment of trade hubs in the short run of 6 - 12 months in Tanzania border posts will happen if both the promoter ITC and in conjunction with the TANTRADE agrees to roll out a pilot project at Mutukula border post according to the prioritization scale. Evidence on the findings has established that majority women group’s lack of resource
  • 8. INT/71/14A Trade facilitation for women informal cross-border traders and MSMEs in the East African Community - phase II capacity (mainly human resource expertise and start-up funding) to sustain the pilot phase let alone to establish and operate the Trade Hub. ii. The introduction and establishment of trade hubs as modernized fully furnished/ equipped and visibly branded facilities will enable these units and the trade hub agents employed therein cope (e.g. former customs officers) with border agencies’ modernization practices. iii. To the extent possible, trade hubs should operate as opposite facility sets of establishments for each border post in the neighboring country as a shared trade facilitation facility to aid informal cross border traders in both countries. iv. Feasibility studies for establishing trade hubs should be carried out in both border posts neighboring each other, resources notwithstanding. For instance, studies conducted on border posts selected on Tanzania side should correspondingly be done on the opposite sides the neighboring community states i.e. Rwanda, Uganda, Kenya and Burundi. v. Introducing and establishing trade hubs in border posts hosting OSBP facilities will require a placement of the trade hub based on two-part location; one part inside the OSBP to deal with such services as customer care, advocacy and trade information. The second part to handle external services such as capacity building and training which are most suitable to an independent location outside the OSBP. However, location outside the OSBP should be targeted within the immediate proximity to enable close contacts with border agencies. This two-tier location informed the estimates made in the matrix part iii (e). vi. The existing MOUs should incorporate the initial joint ownership of the trade hub between ITC and TANTRADE to establish commitment, capacity to roll-out and later smooth transfer to competent associations and their leaderships. vii. The medium-term option of securing a customs clearing license and diversifying to money changing business should be considered as means to support women groups and income streams for the future growth and sustainability of the trade hubs. These licenses could be taken under the responsibility and custody of TANTRADE or any future designated national WICBT body corporate on behalf of its member associations and individuals. A reasonable clearing and service fee could apply to trade hub users. This fee in turn would become additional revenue/income for supporting trade hub activities. viii. Based on the market price indicators during the study, the operations cost of establishing a functional and fully-equipped trade hub is dependent the two-tier location requirement. In scenario one if JBC gives a positive nod to offer occupancy space inside the OSBP and outside location, the following cost estimates will apply i.e. 1 – USD$39,100 renting premises. 11 – USD$57,400 renting land for placement of fabricated trade hub. 111 – USD$58,600 building a trade hub. In scenario two if JBC delays or even objects admission into OSBP, then consideration to locating outside OSBP takes center-stage and lessens the corresponding cost estimates of USD$17,600 meant to cater for inside the OSBP i.e. Options 1- USD$21,500 for renting premises. 11 – USD$39,800 for renting land to place fabricated units. 111 – USD$41,000 for construction of trade hub structure (Refer to the matrix Part iii – e).
  • 9. INT/71/14A Trade facilitation for women informal cross-border traders and MSMEs in the East African Community - phase II 1.0. INTRODUCTION and BACKGROUND International Trade Centre (ITC), appointed and engaged the Regional Consultant, to conduct a feasibility study to establish and introduce Trade Hubs for Women Informal Cross-Border Trades (WICBTs) and Micro Small and Medium Enterprises (MSMEs) in Tanzania on the establishment of is implementing the second phase – 2014-2015 of regional project to facilitate the improvement of EAC WICBTs and MSMEs. The feasibility study is a component critical to the success and full implementation of the project. The report is part of a series of two country studies covering the Burundi and Tanzania four border posts each. The capacity trade hubs are expected to improve the WICBT business environment and the transition from the informal to the formal sector to increase exports to neighbouring countries4 . 1.1. Background to the Assignment The ITC and in conjunction with Tanzania Trade Development Authority (TANTRADE) signed a Memorandum of Understanding to implement the Trade Facilitation for WICBTs and MSMEs in the EAC – Project Phase II for the period 2013-2014. ITC intends to achieve this objective through improving the business environment and the transition from the informal to the formal sector to increase exports to community neighboring countries. The project phase II aims will further be enhanced by the introduction of the capacity trade hubs as one of its key ingredients and initiatives. In this context, the trade facilitation process required conducting a feasibility study at the four selected border posts of Namanga, Mutukula, Rusumo and Kabanga in Tanzania. The main objective of conducting such a study on the placement and installation of WICBT/MSME Capacity Trade Hub service centers at border posts is to ascertain whether it’s feasible to include further value adding activities that develop Women commercial exchanges at border, growth, emergence and the more contribution to building the economy of neighboring countries in the EAC. The findings and recommendations attest to this. 1.2. Why the Capacity Trade Hub Concept and Study Women ICBT practises, like any other ICBTs at the border posts in Tanzania and in the EAC region, simply reflects longstanding indigenous pattern of trading practices that makes more sense than formal trading channels. Throughout the region, ICBT practices continues to be incentivized both by the persistence constraints (e.g. visible and invisible NTBs) facing formal trading but also a feature of economic and social life such as survival well-being of traders. Therefore the capacity trade hub project is an initiative, if successfully established and implemented, expected to contribute to women development in their transformation of the longstanding WICBT informality perceptions and practises that long existed at cross borders. The trade hub initiative is intended to introduce a permanent trade facilitation center at border posts through which continuous engagement and capacity development of the women traders will be sustained. It is further anticipated that most ICBTs will gradually be aided through trade hubs to the formality trading practices across borders which directly contributes to building the economy of neighboring countries in the community. In this report, the feasibility study for trade hubs has examined the current conditions of each border post of Namanga, Mutukula, Rusumo and Kabanga for the Trade Hub, strategic location for Trade Hub, existing infrastructures that can facilitate the establishment of the hub, women’s needs assessment in terms of expected trade hub, human resource capacity to operate the hub: and a review of imports/exports’ volume data at each border crossing. Reference was made to 4 OECD Trade Policy Working Paper No.86, 2009 categorized informal traders into three ascending but inter-related groups i.e. first informal that is unregistered and operating outside the formal economy; second are registered but avoid official border crossing posts; third are registered but partially evade trade regulations and duties through illegal practices such as under-invoicing. Similarly, Trade hubs should target and assist women growth in their registered associations at level 2 and 3 to formality.
  • 10. INT/71/14A Trade facilitation for women informal cross-border traders and MSMEs in the East African Community - phase II the previously prepared literature and conducted studies on border crossing in the region and elsewhere. The data and information has aided establish the current conditions and capacity at each crossing. Once the current conditions were understood, the study formed the basis to examine the planned Trade Hubs establishments and other related issues in Tanzania. The findings are presented along with conclusions and recommendations herein. 1.3. Definitions of the Trade Hub Concept5 The concepts of trade Hubs for WICBT was originally conceived and defined in phase-one of the project. Consistent with the previous definition of capacity trade hubs, the planned trade hub for establishment will be a central point where WICBTs/MSMEs can access assistance related to customs procedures and export requirements, capacity building services, answers to common trade facilitation hurdles such as questions on trade compliance and export market- related information and assistance. This facility could be a designated place such as an office/center; and should be best located within and near the customs control zone within the border post precincts. 1.4. The purpose of the WICBT Trade Hub The trade hub is purposed to provide four key ingredients:-  Customer care services that renders assistance related to customs procedures and export requirements and answers to common cross border trade facilitation hurdles. Trade hub services must facilitate and create a faster, simpler, transparent and more predictable/supportive cross border environment  Trade information and data regarding cross border trade compliance and export market- related information with neighboring business transactions.  Regular capacity development and refresher training to associated cross border traders  Advocacy with strategic partners from national, regional and international sphere for a shared role. 1.5. Capacity Trade Hubs Rationale and Location The trade hub rationale for WICBTs in this study is three fold:-  Continued effort to the transformation of informal women traders from informal to formal trading practices through deliberate export-led strategies and change management process.  Promote and support Women issues with special attention to customer care services and capacity development on cross border facilitation.  Support planned and fit into the existing national and regional policy with its regulatory framework regarding informal and formal cross border trade. In the case of Tanzania all the four border posts under study i.e. Namanga, Mutukula, Rusumo and Kabanga are designed and constructed under the One Stop Border Post (OSBP) concept. Therefore location of the trade hub will then depend upon the functionality and services it will offer. If the JBC committee adopts a decision to agree and approve the allocation of space and occupancy of the WICBT inside the OSBP, it may offer limited space for occupation such as a desk office that can offer customer care/advocacy/trade information services. Other key activities relating to capacity building, training, workshops and conferences/meetings will require spacious location and less noisy/busy outside the OSBP but in the proximity of the border post precincts. There are also can be occasional opportunities to utilize the OSBP board room. In the entire set-up and location context, it is imperative to understand the OSBP concept and its operations. The OSBP means a border post established under section 3 of the OSBP Act as 5 Derived from the Trade Facilitation for Women Informal Cross-Border Traders and MSMEs in the East African Community – Phase II (Inception and Rollout)
  • 11. INT/71/14A Trade facilitation for women informal cross-border traders and MSMEs in the East African Community - phase II revised 2013, at which all traffic utilizing the border post stops only once in each direction of travel and both exit and entry procedures are undertaken from within the same control zone. The OSBP concept introduces a zoning phenomenon known as common control zone. A “control zone” under the Act means the part of the territory of the hosts Partner State within which Officers of the adjoining Partner States are empowered to effect border controls and includes the “exclusive use area”. This implies that on completion of OSBP facility construction at the designated borders, it must be enclosed by either fencing or perimeter wall which curves out and excludes other commercial and social activities outside it in the border post. The JBC committee usually follows strict allocation criteria on demands of office space giving first priority to all relevant Government agencies and critical private sector such as Customs agents and chamber of commerce. This arrangement puts a 50-50 chance of securing office space and the activities of the trade hub to be located partly within or/and wholly outside the control zone. 1.6. Case Study on West Africa Trade Hub (WATH) A comparative case study 6 on one of the USAID sponsored trade hubs in Africa, under its West Africa Trade Hub (WATH) is provided as part of the findings and demonstration to the Tanzania WICBTs and MSMEs. The WATH is premised on the identified key measures to improve regional integration in West Africa following a comprehensive Gap Analysis on the Economic Community of West African States (ECOWAS) Free Trade Area. The Gap Analysis identified the need for improved public–private dialogue and coordinated private sector advocacy regarding implementation of the ECOWAS Tariff Liberalization Scheme (ETLS). As a result, WATH assisted leading firms with trading and transport operations in the region to form a private sector association, known as the Borderless Alliance (BA). Established in 2011, the Alliance is a business association that leverages its members’ influence to identify and advocate for evidence-based transport and trade policy reforms. The Borderless Alliance established an independent secretariat and founded National Committees in Côte d’Ivoire, Nigeria, Benin, and Senegal. It is thus well positioned for long-term sustainability and self-governance. One of BA’s most successful endeavors has been the creation of Border Information Centers (BICs) at border posts along the highly trafficked trade corridors in the region. As mentioned previously, the earlier analysis had highlighted the need to increase awareness of ETLS rules and procedures among the private companies trading and transporting goods within the region, as well as the public agencies responsible for regulating trade. Regional traders find that ports and land borders are major bottlenecks due to the multiplicity or rules and procedures required to move vehicles and goods through border processes—and the lack of consistency in implementation. Each BIC operates with two offices—one on either side of a land border (in Senegal, the Port of Dakar has its own BIC). Each office is staffed with a knowledgeable trade advisor from the host country who advises shippers, truck drivers, producers, and traders on specifics of the regional agreements (and border clearance requirements of the entering or exiting country). With USAID support, from November 2011 to early 2014, the BIC network expanded to nine such information centers. Most BICs are established in partnership with the national shippers’ council of the host country, which usually provides the physical location of the center and which may provide in-kind support. Other financial support to the BICs comes from Customs agencies, national shippers’ councils, and other border stakeholders. USAID has supported the salaries of Trade Advisors (generally former Customs Officers of their respective countries) stationed at each border, and has funded trainings, coordination meetings, publications, and outreach activities. USAID has published a Border Information Center toolkit, intended to guide and inform future implementers on best practices in setting up and monitoring impact. The BICs are already demonstrating significant improvements at the borders where they have been launched. In the second quarter of 2013, for example, average clearance times at borders with BICs decreased by 27% as compared to the previous quarter. 6 Adapted from a comprehensive approach to trade facilitation and capacity building; connecting developing countries to supply chains march 2014 business environments for agile markets sponsored by USAID; authors : Ro Bert Holler, Erin Endean, Paul J. Fekete, And Virginia Brown page 34.
  • 12. INT/71/14A Trade facilitation for women informal cross-border traders and MSMEs in the East African Community - phase II 2.0. METHODOLOGY and APPROACH 2.1. Visits and Study Selection The feasibility study on the establishment of WICBT/MSME Capacity Trade Hubs in Tanzania was conducted in two phases between 7th and 12th September and 26th October to 1st November 2014; and focused on one side of the border in Tanzania. The border sites studied were Kabanga (Burundi/ Tanzania), Namanga (Kenya/Tanzania), Mutukula (Uganda/Tanzania) and Rusumo (Tanzania/ Rwanda).These sites were selected and recommended by TANTRADE because they are among the strategic cross border trading centers and exit routes of the country for both exports and imports to/from community (EAC) countries. There is a high presence of WICBTs activities carried out both on export and import cross border trading. The approach employed a selective qualitative study that targeted focus group discussions involving WICBT chairpersons and their executive committee members since the outcomes will have immediate benefits to their associations. The Office In Charges Customs -Tanzania Revenue Authority, Head of Police and Immigration border post were targeted and consulted as key stakeholders directly involved in supporting placement and establishment of the trade hubs. A review of literature and secondary data was made to acquaint ourselves on the best practice elsewhere (especially WATH & Uganda) the trade hubs have been established or/and are being piloted. The sample size for the questionnaire survey is represented in table 1 below. The selection of the women leaders was purposeful and was based on the participation in association decision making on behalf of their members. Besides during the implementation phase, the same women leaders will most likely participate in the success and operationalization of the trade hub Table 1: Participation of Women ICBT of different Age Groups, Marital status, Occupation and Education by Border location Age Group Border Post Below 15 15- 20 21- 30 31- 40 41- 50 51- 60 61 + Grand Total Namanga 3 2 3 8 Mutukula 1 3 4 3 1 12 Rusumo 1 4 5 Kabanga 1 3 3 1 6 Marital Status Married Single Widowed Separated Total Namanga 6 1 1 8 Mutukula 8 3 1 12 Rusumo 5 5 Kabanga 6 6 Occupation Border Agency official WICBT member MSME member Clearing Agent Total
  • 13. INT/71/14A Trade facilitation for women informal cross-border traders and MSMEs in the East African Community - phase II Namanga 8 8 Mutukula 8 4 12 Rusumo 5 5 Kabanga 6 6 Education University Tertiary/ College Secondary/ Primary Other Total Namanga 8 8 Mutukula 1 3 8 12 Rusumo 5 5 Kabanga 6 6 Source: Primary Data from the field study The Women groups at all the border posts and their associations were indeed found to represent a critical mass of their members i.e. 21 - Namanga, 48 - Mutukula, 38 - Rusumo and 15 - Kabanga. The other key informants belonged to the Government border agencies and included the Office In charge of Customs border posts –Tanzania Revenue Authority (TRA) at Namanga, Mutukula, Rusumo and Kabanga border posts. They are the current Joint Border Committee chairpersons at the four respective border posts. Other border post official heads came from Immigration, Regional and District offices at Longido, Missenyi and Ngara. The private sector at Namanga and Tanzania National Chamber of Commerce – Mutukula Branch participated as additional key informants. 2.2. Information and Data Collection Procedure 2.2.1. The Study Entry Process The study team consulted all the parties as key stakeholders, decision makers and representatives with influence to support determine the placement and establishment of the WICBT trade hub. In Tanzania the power centers and structures are deliberately linked to the center in Dar es Salaam. For instance, any activity to be carried out in the district must be reported to the District headquarters, the district consults the center in Dar. The study entry process started with the District Director before proceeding on to visit any of the four border posts. The Director received the team and was given a briefing from TANTRADE representative and Consultant. He then asked the Trade Development Officer to accompany the study team as a Government/District representative. 2.2.2. The Joint Border Committees and their Roles The study team was assisted and guided by the OSBP Joint Border Committees. All the four border posts visited were designed and constructed under OSBP concept and arrangement. Namanga and Mutukula OSBP facilities are completed for occupation pending completion of their opposite and counter-part OSBPs in Kenya and Uganda respectively. OSBPs at Rusumo and Kabanga are expected to be completed and perhaps commissioned in 2015 since their counter-part OSBPs in Rwanda and Burundi are already in operations. Tanzania government through her relevant ministries established JBCs and assigned TRA as chair. Each of the OSBP border posts above must be organised under JBC administrative structure which functions as a
  • 14. INT/71/14A Trade facilitation for women informal cross-border traders and MSMEs in the East African Community - phase II governance organ that forms the first layer of decision making on the day-to-day operational activities and challenges without consulting regularly from the central government in Dar. What is the Joint Border Committee (JBC)? The JBC is a multi-Sectoral collaboration of key government agencies and the private sector involved in the border post clearances for the purposes of: - Promoting a trade facilitation mind set to all relevant and participating cross border stakeholders - Defining critical operational challenges and providing possible solutions at the borders - Enhancing inter agency collaboration and mutual trust/cooperation at border post - Encouraging joint usage and sharing of available resources at the border - Arbitration and defusing tension and conflict between public and private sector - Minimizing the disconnect with Headquarters in Dar and bridging the any existing gaps - Rationalizing control and regulation at the border posts through wider consultations JBC is a border post organ that will not only influence placement of the trade hub inside OSBP but also critical to collaborate with WICBT and enable their success. 2.2.3. Government Border Post Agencies and Private Sector The study team made initial contacts with both the government and private sector stakeholders. All government, other government and private sector border agencies operating at the border within the OSBP are formally represented in the JBC governance organ above. The team met and sought views as part of the focal group discussions from the Trade and Community Development District Officers all from the three Districts of Ngara (Rusumo/Kabanga), Missenyi (Mutukula) and Kajiado (Namanga); and the WICBT/Private Sector Chairperson and Chairman JBC in the case of Namanga and Mutukula. The Tanzania National Chamber of Commerce Branch representatives were present as well at Mutukula. The study team’s objective was to seek free access, inspections and conducting interviews at the four border posts. The regional consultant led the engagement for direct interviews with all the key informants and respondents. During the engagement sessions the trade hub concept was introduced by the regional consultant. This process would then be followed by question and answer session. Feedback was quickly incorporated into the study. The purpose of introducing the trade hub concept was to sensitize the key informants, register early their buy-in/comprehension and assess their immediate feedback/perceptions. 2.2.4. Women ICBT Participation in the Survey The study team met the WICBT group first and separately as our point of entry and major key stakeholders in all the border posts. The WICBT survey questionnaire was designed following the terms of reference to deliberately gauge the respondents’ perception and potential support towards the trade hub. The involvement and participation exercise by the Women groups’ members and their executive committee members meant that their views would be incorporated as well but also start to own the trade hub project. In each case, respondents were assembled in a central but relaxed meeting venue to participate conveniently and freely. During the meeting and before administration of the questionnaire to the targeted focal respondents was done, the National Coordinator would introduce the purpose of the visit. He would then ask the representative from the Trade Support Institution (TSI) – TANTRADE, to share the purpose and intentions of the ITC/WICBT project in the country and EAC region. The Women groups chairpersons and their committee members would make brief comments on their status, current roles and grouping or/and association activities. The regional consultant would then introduce the trade hub concept where upon questions and answer session would follow. The whole exercise would be conducted in English and translated by the team’s
  • 15. INT/71/14A Trade facilitation for women informal cross-border traders and MSMEs in the East African Community - phase II coordinator into the commonly spoken language i.e. Kiswahili, to enable the respondents understands the questions and bridge any possible language barrier gaps. Throughout the engagement the women’s needs assessment in terms of expected trade hub and human resource capacity to operate the hub would be determined. 2.2.5. Key Informant Group Interviews The guided Key Informants Group (KIG) interviewing sessions in every border post were conducted into two separate focus groups. The purpose of interviewing the two groups separately was intended to set the ground free of expression and any perceived influence from the JBC. The first group consisted of the leadership of the Women ICBT groups for Mutukula, Kabanga, Namanga and Rusumo7 . The Women association leaders as KIG8 brought forth their views and feedback about the new concept of trade hub and how they expected it to benefit them. The questions were read from preprinted questionnaires and explanations were made in Kiswahili for items or words that were difficult to respondents. The second group referred to each of the border agencies’ heads of stations that comprises the JBC. The key participants consisted of the Chairperson for the JBC existing at border posts, the Immigration station head and the private sector chairperson. In all instances, respondents were assured of confidentiality throughout the session and thereafter. We would seek to get imports/exports’ volume data at each border post from Customs Authorities. The interviewers’ roles were to ask only the relevant questions from the questionnaire to the informants and record responses at the same time. Information accruing was concurrently recorded in order to aid analysis for subsequent draft and final reports. 2.2.6. Inspection of the border post A guided tour and inspection would then follow after meeting the Joint Border Committee and Women group leaders. The inspection was intended to identify the strategic location for Trade Hub on either inside of the existing One Stop Border Post (OSBP) facility or outside it. All the JBC Chairpersons were non-committal other than goodwill promises to confirm availability of space inside the OSBP. The study team was taken on a guided inspection tour by the chairperson or his representative to identify any possible premises for rent or any piece of land for acquiring privately from individual owners in the surrounding border town centers. Most JBC Chairpersons appeared promising to consider the WICBT associations’ applications for occupancy after the OSBP facilities have been officially commissioned and gone through all the necessary formalities. TANTRADE in conjunction with women groups’ chairpersons should take on the responsibility of continued engagement with JBCs’ to ensure space allocation inside OSBPs is secured and formally confirmed. The idea of acquiring the piece of land came through to inform the future decision of having a permanent place for placement of a container, fabricated office or physical construction as the case may be or warrant. 3.0. KEY FINDINGS FROM THE FEASIBILITY STUDY 3.1. Assessment of Border Posts for Trade Hubs in Tanzania The assessment and selection of four border posts were done based on the immediate needs and considerations of both the intended beneficiaries and sponsoring agency regarding prioritizing the most appropriate locations for piloting and subsequently establishing the trade 7 The Women Groups at Mutukula and Kabanga were not yet formally registered but had made progress with the draft constitution making process with the district authorities. At Namanga and Rusumo, Women Groups were yet to initiate the process of registration. The final registration process in either case will be completed by the civil authorities at the district and in Dar by issuing certificates. 8 The list of key informants is presented in the appendix II.
  • 16. INT/71/14A Trade facilitation for women informal cross-border traders and MSMEs in the East African Community - phase II hubs. We developed a prioritization scale where 1 = very feasible, 2= feasible, 3= less feasible and 4= not feasible with weighted strength from 1 as the very feasible to 4 as not feasible see section 3.2 matrix below. The scores were against the set criteria as provided in the terms of reference. We coupled this selective method with the knowledge from the previous phase 1 and the on-going trade facilitation project work done in phase 2 at the four border posts of Mutukula, Namanga, Rusumo and Kabanga in 2012 and 2014. Both phases resulted into several important outcomes of immediate benefit to the women ICBTs in the community but more specifically Tanzania. During the first phase in 2012, related efforts resulted into some significant achievements. For instance, formation of women ICBT associations at the borders, establishment of capacity trade hubs at the Mutukula and Busia borders in Uganda, training aids/ manuals to improve women’s capacity to comply with customs and border processes, guides on formal cross-border trade and how to transition from informal to formal status, guidelines for setting up and sustaining Women ICBT trade associations. This background information guided the assessment and scoring basis premised on the terms of reference upon each the border posts below. The findings and outcomes are follows is the next sections. 3.1.1. Mutukula Border Post Mutukula border post is one of the entry / exit border posts that link the community from Uganda to Tanzania with a recently constructed OSBP facility pending commissioning (Figure 1). Mutukula border and its township is situated in Kagera region and administered by Missenyi District Headquarters (Figure 2). It is here that all authorization to visit and access the border post is secured and any administrative services required by the Women groups regarding registration and licensing into an association is obtained. Fig 1-Mutukula Border Post – New OSBP Facility Fig 2- Missenyi District Hqtrs that authorized visit to Mutukula The guided tour to conduct an inventory of existing infrastructures that can facilitate the establishment of the hub with the border agencies and women leaders was done. During the tour, we identified various locations suitable for the trade hub especially the renting outside the OSBP facility option (figure 3). We established availability of grid and stable electricity supply, internet and telephony communications networks. The OSBP facility is anticipated to cut-off the town communities and its premises upon commissioning other the passenger gates which will necessitate outside location of the trade hub capacity building functions.
  • 17. INT/71/14A Trade facilitation for women informal cross-border traders and MSMEs in the East African Community - phase II Fig 3: Guided tour of stakeholders to identify trade hub location Fig 4: Customs Parking Yard with traffic for Imports/Exports While meeting the border agencies, issues of conforming to the designated procedures and services available to WICBTs were discussed. According to Customs, Mutukula border post handles 5% share of imports volumes and 12% of export volumes to the community (table 2). The cross border transit traffic has increased tremendously from 15 to 60 daily in the last two years as a result of reconstruction to all-new tarmac road networks from Dar es Salaam port (figure 4 & JBC). On average of 400 – 500 ICBTs are estimated to cross the border daily. Through modernization projects, systems and processes have been simplified through increased automation and online declaration services for women. The Immigration officer on his part confirmed provision of convenient temporary movement passes to local residents wishing to crossing to Uganda. This entry/exit pass is free and is valid for up to two weeks. Local residents from Uganda had to pay a small fee (Tshs 2, 500) for such a temporary pass to get to Bunazi local market 25km inland Tanzania instead. This was confirmed by the JBC (figure 5). Fig 5- Meeting with the JBC representatives at Customs office Fig 6- Mutukula MUWOTA Women Group in FGD We established during the FGD (figure 6) that the Women group at this border post had previously benefitted in the phase 1 and now 2 project outcomes especially the training to improve women’s capacity to comply with customs and border processes, using the established capacity trade hub at the Mutukula border –Ugandan side and formation of their women ICBT associations. Missenyi District’s Regional Development Plan already supports and promotes all Women and youth groups in the region. The District officials supported and encouraged women traders use their MUWOTA platform to apply and secure some lock-ups for their members in the on-going construction of a Cross Border Trade Market Complex. It is expected to host shops, a market, lodges, restaurants and offices. The Chairperson of the Joint Border Committee urged the MUWOTA Chairperson to approach him for consideration on space allocation after the due process of registration is completed. Mutukula overall scores highest on the prioritization scale
  • 18. INT/71/14A Trade facilitation for women informal cross-border traders and MSMEs in the East African Community - phase II (section 3.2 matrix below). MUWOTA- Women Group was found to be most prepared within a period less than six months to support establishment of the trade hub. 3.1.2. Kabanga Border Post Kabanga border post is one of the main export and transit traffic ports that link Tanzania to Burundi. The border post is the latest in the development of the OSBP facility and concept slightly behind the other three in completion. Kabanga border post and its neighboring township is situated in Kagera region and administered by Ngara District Headquarters (Figure 2). It is here at the office of District Director that all authorization to visit and access the border post is secured and any administrative services required by the Women groups regarding registration and licensing into an association is obtained. Fig 7: Kabanga New OSBP Facility under construction Fig 8: Ngara District Headquarters – Director’s Office The Immigration Officer in Charge, representing the chairperson JBC conducted a guided tour for the team to ascertain an inventory of existing infrastructures that can facilitate the establishment of the hub. We visited the new site of OSBP where all the government agencies will shift soon after commissioning of the facility. According to the JBC, the old structures will be retained for any auxiliary needs and services since they belong to government. However, there was a possibility to have some space in the new OSBP facility on first come first serve basis for the private sector. The team visited the OSBP service center on Burundi side where Tanzania agency officials were sharing the same facility with Burundian officials (figure 9). In this arrangement, we were told that a few WICBTs have started coming from Tanzania and stop once for declaration and release of their cargo. On our return journey from Burundi, we sighted the on-going construction of a Cross Border Trade Market Complex opposite the new Kabanga OSBP facility, which will host shops, a market, lodges, restaurants and offices. JBC further advised the women group leader to make early contacts with the District administration authorities to book space for the trade hub office and market stalls for their members. There was evidence of many private premises for renting out adjacent to customs old buildings and within Kabanga Township. Unfortunately, the premises are located more than 500 meters away from Customs offices and even further away 1km from the new OSBP facility to adequately serve as rentals for establishing trade hub. The border post is well served and connected with utilities infrastructure such as stable grid electric power; internet connectivity is by private telecom service providers and mobile telephones (figure 10).
  • 19. INT/71/14A Trade facilitation for women informal cross-border traders and MSMEs in the East African Community - phase II Fig 9- OSBP juxtaposed TRA office in Burundi Fig 10- Grid Electricity & Telecom at Customs Office The study team met the border agencies and private sector representatives at the Customs office. There were high expectations of shifting to the new facility all government agencies to sit under one-roof with their Burundian counter-parts when completed perhaps by early next year 2015. According to Customs, Kabanga border post handles 25% share of exports volumes to the community to Burundi and less than 1% share of imports from the community from Kobero – Burundi (table 2). The border transit and export traffic exits close to 2,500 cargo trucks and passenger vehicles every month. On average 100 - 200 ICBTs are estimated to cross the border daily on peak/ market days on Thursday to Muyinga 15km from Kobero border post in Burundi. Our tour guide pointed out some challenges WICBTs may face due to uncontrolled and illegal migration of people from each side of the country. There is no a natural barrier on either side of the border and between the two OSBP facilities with more than 2 kms stretch of free and No- Man’s land. This would-be No-Man’s - Land is currently getting occupied fast by settlements, residential and commercial premises developments under construction. The Kabanga Immigration office provides temporary border movement passes to local residents to cross to Burundi especially on market days. Fig 11-Kabanga Women Group in FGD Fig 12- Meeting Ag Chairperson JBC During the FGD with Kabanga Women Group (figure 11) some women members indicated that they had previously benefitted in the phase 1 and now 2 project outcomes especially the training to improve women’s capacity to comply with customs and border processes and formation of their women ICBT associations. Ngara District Community Development Office is already supporting the drafting of the Women ICBT constitution making process. On the prioritization scale, Kabanga Women Group becomes overall second with a shorter period of readiness (nine months) before the trade hub is established.
  • 20. INT/71/14A Trade facilitation for women informal cross-border traders and MSMEs in the East African Community - phase II 3.1.3. Namanga Border Post Namanga is the main point of entry / exit that link Tanzania and Kenya (figure 19). This border post is a politically and economically significant for inter-trading activities across the gates between the two countries – Kenya and Tanzania. Locally, the border post is located between the Longido district (Tanzania) and the Kajiado County (Kenya) and represents the major shift of improved infrastructure to the recent construction of the One Stop Border Post facility (figure 20). However, it is awaiting their Kenyan counter-part OSBP facility construction to get completed in order to commence full-scale juxtaposed operations. Fig 19- Border Agencies’ Offices Opposite OSBP facility still in use Fig 20- OSBP Facility with Imports/Exports trucks During the station outdoor inspection, we observed that behind the main road leading to the exit entry there is vibrant and blend of formal and informal business establishments and trading activities. This part of town is already curved out by the constructed fence with the impending commencement of OSBP juxtaposed operations soon (fig 20). OSBP infrastructure limits access by the original border residents and any settlements outside it. Placement of the trade hub will have to consider two-part location; one part inside to deal with such services as customer care, advocacy and trade information. The rest of the services such as capacity building and training is most suitable to locate in the curved out town area. The border post handles 54% share of the import volumes originating through community border posts; and 35% share of export volumes to the community (table 2). Averages of 300 – 400 ICBTs are estimated to cross the border daily (JBC). According to the private sector chairperson and the Women group leader, up to an estimated 400 people cross the border daily. Another estimated 60% (250) belong to cross border traders originating from as far as Arusha and Nairobi. However, the WICBTs are just considering themselves to get organized and form into formal association. At the time of our visit, a group of Women led by its chairperson Sara Keiya were in the process of associating to start registering their association titled Namanga WICBTA with the district authorities at Longido. The membership was at 21 strong and still growing. This group is the future WICBT at this border post for dealing with in the trade hub project (figure 21 & 22). Fig 21- Namanga WICBT group in FGD session Fig 22- Study team visiting a WICBT member’s shop
  • 21. INT/71/14A Trade facilitation for women informal cross-border traders and MSMEs in the East African Community - phase II The trade hub concept was introduced to both the border agencies and WICBT group situated at Namanga (fig 21). The Women Group will require sustainable assistance during the gestation period of one year. Therefore this puts Namanga border post in the third priority slot on prioritization scale and for the pilot to establish a trade hub. It will have a hold up phase till the growth path of Namanga Women Group development and formation into a WICBT association is attained. 3.1.4. Rusumo Border Post Rusumo border post is one of the key transit and export ports that link Tanzania and Rwanda (figure 13-14), with a near completion OSBP facility (Figure 15). Rusumo border and its township is situated in Kagera region and administered by Missenyi District Headquarters (Figure 2). It is here that authorization to visit and access the border post was obtained. The community development officer Helen Mkongwa notified that any administrative services required by the Women groups regarding registration and licensing into an association is done by the district authorities. The border agencies still occupy a temporary shelter which accommodates all border agencies’ offices (figure 14). Fig 13-Rusumo border post Fig 14- Current Border Agencies Office Fig 15- New OSBP facility due for Completion The port is one of the near completed OSBP facilities (figure 15) and already handles 22% share of export volumes to the community through Rusumo – Rwanda, and less than 1% share of imports from the community (see table 2). It exits an estimated 100 transit cargo trucks less passenger cars/buses on average and 60 ICBTs are estimated to cross the border daily. Challenges include location of the border post situated along a very steep ridge, wide River Rusumo and narrow bridge that marks the boundary between Rwanda and Tanzania. There is a huge difficult for settlements and residential and commercial premises to conveniently get constructed and expand. The OSBP facility has already been cut-off from the neighbouring town community with the fencing around it. There is a JBC headed by Customs to coordinate all border activities. The Rusumo Immigration Office fully-pledged to provide border movement passes to local residents to attend market days in Rwanda. Fig 16-Rusumo WICBT members in FGD Fig 17-Inspection with border agencies Fig 18- Electricity and Water are available
  • 22. INT/71/14A Trade facilitation for women informal cross-border traders and MSMEs in the East African Community - phase II Ngara District Community Development Office is ready to support and promote Rusumo Women Groups in the registration process if they present themselves for assistance. There is no border market on the Tanzanian side; instead it is located at the Rwandese side. Rusumo JBC has mandate to consider space allocation or not to the trade hub. “The Chairperson of the Joint Border Committee - Customs urged the Chairperson WICBT to approach him for consideration on space allocation after the due process of registration is completed”. Another estimated 80 – 100 ICBTs cross on Tuesdays, Thursdays and Fridays which are market days to the border market located at Rwanda side (JBC & figure 14). During the visit the trade hub concept was introduced to the border agencies. A consultative meeting with border agencies was held and later an inspection conducted (fig 17). We found no clear buildings and space to rent or put a trade hub facility (container, etc.). Other infrastructural facilities such as electricity (including stand-by generator), telephone, internet (Telecom modems) were seen to be available and in place (figure 18). Therefore this puts Rusumo at a hold up phase9 till the Rusumo Women Group has registered and under gone capacity building arrangements favourable for the piloting the establishing the trade hub are in place. It becomes fourth on the prioritization scale for the pilot considerations. 3.2. Prioritizing the Border Posts for Establishing Trade Hubs Prioritizing the border posts in Tanzania was based on the five parts criteria therein the matrix below and in accordance with the terms of reference provided. The findings that are unique have been segregated and scored against the respective border posts. There are those that are cross-cutting across the criteria have been merged into one theme. The following section presents summary findings of the four studied border posts for establishing trade hubs in tabulated format. ITEMS RUSUMO KABANGA NAMANGA MUTUKULA Part I: Prioritize the border post in which to establish the trade hub on the basis of: a). Volumes of imports that come from the neighboring country (s) The volumes of imports that come through Rusumo border post in Rwanda stands at 1,091 tons valued at CIF $1,521,073 (see table 2). The Import volumes that originate through Kobero border post in Burundi were established to be low at 85 tons valued at CIF $425,539 (see table 2). The trade import volumes from Kenya and Mombasa through Namanga border post in Kenya stands at 124,384 tons valued at 215,538,852 in 2013 (table 2 below). The general goods from the community that come through Mutukula post in Uganda stands at 44,303 tons valued at 18,936,275 in 2013 (table 2 below). Table 2: TANZANIA IMPORTS AND EXPORTS THROUGH EAC KEY BORDER POSTS IN THE FINANCIAL YEAR 2013/14. ITEM COUNTR Y ANNUAL VOLUME S RUSUMO KABANGA NAMANGA MUTUKULA UNITS/YE AR 2013/14 CIF (USD) CIF (USD) Net Weight (KG) CIF (USD) Net Weight (KG) CIF (USD) Net Weight (KG) CIF (USD) Net Weight (KG) GENERAL IMPORTS 397,025,9 08* 1,521,07 3 1,091,08 3 423,539 85,491 215,538,8 52 124,384,4 92 18,936,2 75 44,303,8 61 % Share 1 or 1or < 54 5 9 Hold up phase in the context of this study is the transition period through which a WICBT/MSME group will take to grow and attain capacity to manage the pilot of establishing a trade hub at the designated border post. The period in the case of Tanzania could up to one year for all border posts.
  • 23. INT/71/14A Trade facilitation for women informal cross-border traders and MSMEs in the East African Community - phase II of total volumes <0.05 0.01 DOMESTI C EXPORTS 421,613,8 40* 91,050,9 19 85,044,4 16 105,424,5 39 138,658,4 28 146,269,3 93 160,530,5 96 49,255,3 42 35,244,3 32 % Share of total volumes 22 25 35 12 Source: Authors compilation based on TRA Annual statistics for all commodities of general Imports and domestic exports through community ports for the FY ending 2013 ** Import and export volume figures include other community border posts e.g. Sirali, Holoholo, Holili, Marongo, Tarakea, etc. NB: The trade volumes for imports/exports above were not possible to segregate them into determining the portions that related to WICBTs business and other trading entities/activities. Score on scale* 3 4 1 2 b). Volumes of exports that cross border to the neighboring country (s) The volumes of domestic exports destined through Rusumo border post to Rwanda stands at 85,045 tons valued at CIF $91,050,919 (see table 2). The volumes of domestic exports that are destined to community through Kabanga border post to Burundi stands at 138,659 tons valued at CIF $105,424,539 (see table 2). The volumes of domestic exports that are destined through Namanga border post to Kenya stands at 160,531 tons valued at CIF $146,269,393 (see table 2). The volumes of domestic exports that are destined through Mutukula border post to Uganda stands at 35,245 tons valued at CIF $49,255,342 (see table 2). Score on scale* 3 2 1 4 c). Volumes of trade exchanges by WICBTs (as Associations or/and Individuals on both sides) at this border crossing from the neighboring? Rusumo Women Group members are active in cross border trade during the market days on Tuesdays, Thursdays and Fridays. There are not specific trade exchanges known to take place both at an individual or group levels. Their counter-part WICBTs in Rwanda were said to organize into cooperative societies. “This level of organization makes it easy for us to access and buy goods from them” commented Pendo Bolingo a WICBT the chairperson. Kabanga Women Group conducts their businesses on an individual basis. This implied that when there are any trade exchanges or it is not easy to tell or get to know. Any transactions of this nature are entirely private and unrecorded. Namanga Women Group has no known trade exchanges either as a group or as individuals. According to Sara Keiya the leader of the Women Group, “there are could be cultural/social exchanges on some goods/items that are communal but dependent on individual relationship and common practices of extending sales/barter trade schemes. It is not possible to ascertain the volumes of trade exchanges”. Women Group members in the FGD further added that:- -There are not records kept by the associations - Transactions are individualized confidential and not easy to ascertain. -On average a WICBT makes 15 MUWOTA is comprised of both WICBT and MSME traders. Majority of MSMEs have capacity to deal directly with their counter- part association members in Uganda. These are Women ICBTs that own shops, schools, bakeries, market lock-ups and stores where they base themselves to run their cross-border trade The Chairperson Benuza Jane admitted, “that some level of goods exchanges may be taking place but it is not easy to know let alone record”. She is currently a dual chairperson of both WICBTs associations. On average 10-12 trips are made by MSME Woman trader and 1-2 times a day for WICBT either exporting or importing/bringing in commodities. No data on volumes of exchange = Less feasible - 3
  • 24. INT/71/14A Trade facilitation for women informal cross-border traders and MSMEs in the East African Community - phase II transactions every month trading in cattle and milk products selling them to Kenya. - Cross border trade by WICBT is characterized by perishable commodities such as tomatoes, milk, bananas, and onions. Score on scale* 3 3 3 3 d). Presence of WICBTs’ associations are at the border or proximity There were no presences of other known WICBTs associations either at the border post or in the proximity at Ngara Town, save for Rusumo Women Group. There is VICOBA - a micro-institution branch in Ngara and its headquarters in Dar. VICOBA has 30 members some of whom belong to Rusumo Women Group. They meet together with other non-members to apply and receive loans weekly with a 5% quarterly interest. Scale No draft copy of the constitution= Not feasible- 3 At Kabanga border post only Kabanga Women Group exists. Helen Mkongwa, a trade development officer who supervises both Kabanga and Rusumo areas in Ngara District confirmed that there only two WICBT groups known and getting registered with her office. All the groups are located at the border posts. Draft copy of the constitution =Feasible- 2 -The Namanga Women Group leader – Sara Keiya had this to say, “There are a few women who know about formal Women ICBT associations and these are mainly from Mutukula and the surrounding areas. They also have heard about them in countries like Uganda, but have not yet seen them operate in Tanzania”. -Namanga border post has no WICBT formalized group or association known as yet. Namanga WICBT group that we held a meeting with is still informal and unregistered neither by themselves nor by the Namanga town council or Longido District. -There were no other WICBT groups or associations that were known to be in the proximity or exist within the district of Longido at the moment. No draft copy of constitution - 4 At the time of our visit, the Community Liaison Officer Anna Ndile confirmed only MUWOTA as the only WICBT association related with WICBTs. The group has already made a constitution (see fig 23 below). She attests that it was pending final amendments by the MUWOTA Chairperson and her executive committee before they submit it for onward approval in Dar for registration and license issuance. Figure 23 -According to the Development Officer in the proximity there is Missenyi District and Town with over 200 other various groups of Women and youth both involved in different social and cultural activities. Scale: Draft copy of constitution near completion = Very Feasible-1 Score scale* 4 2 4 1 e). Key challenges the WICBT group or association face RUSUMO WOMEN GROUP faces the following concerns as a group:- i). The delayed implementation of the ITC programme KABANGA WOMEN GROUP was found to face the following issues as a women group:- i). The delays in the implementation of the ITC programme lead to NAMANGA WOMEN GROUP was considered to face the following key challenges:- i). Their group has un elected leader MUTUKULA WICBT Association - MUWOTA was found to face the following concerns to their association:- i). The association is led by a Chairperson – Benuza
  • 25. INT/71/14A Trade facilitation for women informal cross-border traders and MSMEs in the East African Community - phase II lead to most members abandoned the initial association and left the association. The current group membership stands at 38 members. ii). All the members indicated capitalization for their projects and business is the main problem. VICOBA is the only government micro-finance institution that comes to their rescue to assist. Many conditional requirements such as registration certificate as collateral for the group members fails them. iii). The Women Group had not started registration processes with Ngara District authorities. vi). Accessing the simplified certificate of origin copies for use by group members who intends to export to Rwanda is very difficult. A member is required to travel to Bukoba or Dar. This increases the cost of doing export business and getting taxed heavily including agricultural products. iv). Lack of translations of common traded transaction documents and circulars from border agencies in Kiswahili for their members. But most members may be fluent in speech but very limited in reading such communication which has hampered their business opportunities. Scale: Less Feasible = 3 members becoming skeptical and left the association. Indeed the membership had reduced by half from 27 to only 15 members. However for registration purposes, a minimum of 12 members are needed. ii). There is absence of sustainable credit facilities and products to support group members’ businesses. VICOBA is a micro-finance institution that attempts to assist but has many demands such as registration certificate, collateral products from group members. iii). The Women Group lacks a formal structures and a place of abode to cater and provide answers to inquiries and concerns from women. v). Similarly, delayed formalization and registration of the Women Group has paralyzed a number of activities and probable participation in the JBC activities and meetings at the border. vi). There is a difficulty in obtaining the simplified certificates of origin copies for use by members who intend to export to Burundi. As a result every item exported across the border is taxed heavily including agricultural produce. and about 21 members. The Chairperson – Sara Keiya remain the main contact person and her group is informal without any a document with rules and guidelines. ii). They are not yet recognized and registered by the National Chamber of Commerce as a result. iii). The group is not permitted to participate in the Joint Border Committee activities and meetings. iv). The Women group is neither part of the private sector forum nor allowed to become members unless they formalize and register with the Longido District Office. v). They have not yet made formal contacts and relationships with the Kenyan WICBT which was said to be more formal and organized. vi). Lack capacity and means/funds to start the process of group formation and registering into an association at the district. vii). The group members are conducting their ways and business transactions on individual basis and family support. viii). Restricted movement of border communities especially the Masai people (Masai WICBTs) whose ancestry Jane Charles who is a Ugandan resident and origin. As an individual she is a university graduate, widely knowledgeable and has active business interests on both sides of the border. However, in the long –run it is generating debate and conflicts as to whether she should continue to qualify to hold two leadership portfolios for both WICBT associations in Uganda and Tanzania. ii). The current association that is prominent but pending formal registration is called Mutukula Women Traders Association (MUWOTA). The name implies Women Traders an association of a certain category of women that belong to micro, small and medium enterprises (MSMEs). The very informal women cross border traders feel left out and not belonging to this association. The above underlying concerns are known to the National Coordinator and are already dealing with such group dynamics till stability is secured in the process. iii). The association lacks a formal office or information desk that is available to cater and provide answers to inquiries and concerns from women. It is said to boost of over 48 members. v). Delayed formalization and registration of the association has paralyzed a number of activities and probable participation in the JBC activities and meetings at the border. vi). Lack of simplified documents/copies on the EAC regional and revised protocols, laws/ regulations that are translated in English and Kiswahili for their members has hampered their business opportunities. v). women address the risks they face in their trade related activities given that they are typically more risk averse than men and respond to risk in different ways. This reflects the particular challenges
  • 26. INT/71/14A Trade facilitation for women informal cross-border traders and MSMEs in the East African Community - phase II grazing areas straddles and across the two countries’ frontiers and only limited to an official 10 km distance in-land on either side according to Immigration officials. that women face in participating in trade and managing enterprises Score 3 3 3 3 f). Services Association provide to Women members at the border The expected services women members should receive from their associations and groups are generally:- - Calling for regular meetings to share on the border activities and understanding transformations taking place with the introduction and anticipation of OSBP facility service arrangements. -Arranging venues for regular group meetings at members premises or homes - Office for their record keeping, documents, stationary and files - Receive cross border trade related information and data compiled - Support from each other and making financial contributions for members when faced with challenging situations for instance when calamities occur, burial arrangements; social assistance such as community and social events, weeding parties, conduct training workshops, -Networking center with furniture and equipment to relate effectively with border agencies and counter-parts in the neighboring country. -Get services such as internet, photocopying and printing to aid and simplify their business dealings and knowledge. Score 2 g). Survey on the level of challenges faced by women A deliberate random sampling survey was employed to inquire from the WICBT group/association and other women at Rusumo, Kabanga, Namanga and Mutukula border posts to provide insights at key seven broad levels of challenges faced by women; i. Economic and Trade:- • Women are still experiencing persistent harassment for money, sex or exchange of goods by some corrupt and unethical border agency officials; • Most women are not aware of the recent developments of introducing OSBP facilities and with their associated modernization systems/procedures, border agencies laws and regulations and this gets used against them, i.e. the impact is more on the informal cross border traders; • Numerous non-trade barriers (NTBs) are still a prevalent and a serious problem. For instance, local councils/townships fees/charges/levies and the parking fees introduced by the Longido (Namanga), Missenyi (Mutukula) and Ngara (Kabanga/Rusumo) Districts, police stoppages demanding bribes, etc. • Challenges associated with management of SPS and lack of trade facilitation push traders to use informal routes. Many unnecessary clearance procedures were cited which resulted in long waiting times, such as the scanning and issuance of requisite documents for agricultural/animal produce. Some trucks had to stay at the border post for up to 2-3 days. These goods generally require SPS and veterinary certificates. SPS measures are regulations for food safety, animal and plant health standards which aim at enhancing consumer welfare through consumption of safe food products. SPS certificates are obtainable from distant district headquarters of Bukoba, Arusha or Dar-es-Salaam. Tradable goods (i.e. tomatoes/bananas) are usually ready for the market at the point they are being ferried across the border. Due to the perishable nature of the goods, the mode of transportation is generally trucks and the consignments could be for different cross border traders using pooled transport. • Competition from counter-part WICBT members in Kenya, Rwanda, Uganda and Burundi on the account of Duty remission schemes and unfair tax regulations. NB: - Tanzania follows both the EAC & SADC tax regimes. This means there some contested commodities that will not enjoy duty remissions/tariff exemptions and other EAC partner states will not honor at all e.g. Rice and Sugar. ii. Political:- The configuration and atmosphere in neighboring countries politics is varied and not commensurate with the cultural norms and social cohesion in Tanzania. For instance, WICBT allege encountering mistreatment by some border agencies’ officials whenever they travel to Kenya and Rwanda to sell or purchase commodities. Uganda was said to be fairly flexible in treatment with issuance of a chit that should last one day to have returned back into Tanzania. Rwanda is non-compromising on non- regulatory practices and conduct by some ICBTs. Imposes restrictions and controls to the mass flow of the traders with multiple tradable merchandize crossing on market days. Some Customs officials in OBR - Burundi were said to impose levies/taxes on every import whatever quantity and description of commodities crossing the border where they are not supported by documentations from the country of origin.
  • 27. INT/71/14A Trade facilitation for women informal cross-border traders and MSMEs in the East African Community - phase II iii. Financing:- • Levels of securing credit and soft loans for doing business and expanding their business volumes and lines has remained limited and scarce with women groups at Rusumo, Kabanga, Mutukula and Namanga. There are few women ICBT groups who have afforded to secure loans from banks or Microfinance institutions such as VICOBA10 . However, many of WICBT who fail to get but still need loans have resorted to borrowing from friends, colleagues or family members. This process manifests with its own limitations such as failing to raise enough funding needed as well as destroying friendships once there are delays or fails to pay back the borrowed money. • A few of WICBT groups have come up with the idea of cash-round groups, which are a form of rotational groups in which members regularly pool resources and give everything to one members until each member has had their turn. This method is proving to work for the women and they hope to improve these groups and formalize them. • Mrs. Ndile Anna a Social Welfare Officer in the Community Development Office at Missenyi District Council made this observation: “There is generally lack of capital for women traders. We have tried to extend short-term loans to Women both old and young, but these loans are small. We have over 200 groups in the whole District, including other youth groups and so we only give to 6-10 groups, depending upon what the government can handle.” iv. Social: - “There are some levels of discrimination and unfair treatment when one is conducting cross border trading in the neighboring Kenya and Uganda” claims one Florida a ICBT member. In Kenya for instance, Masai informal traders are harassed when they cross further inland into Kenya without any formal documentation to sell or buy milk and other cattle products. Tanzania Immigration claims that they allow their Kenyan Masai counter-parts a 10 km free zone kind of trade but this is not reciprocated by Kenya on the Tanzania Masai. Furthermore, there are levels of language barriers mainly on English that is used on official documents and daily communication in Kenya and Uganda. Some border communities for example Masai don’t speak Swahili at all or fluently which is an official dialect in Tanzania. The Tanzania education system was said to emphasis Kiswahili as a mode of instruction and teaching in most primary schools and English is introduced at secondary levels. This implies that most primary leaving graduates will communicate, write and transact in Kiswahili. v. Cultural: - The border post frontiers are inhabited by tribes/communities that share same language dialects and cultural backgrounds. Both communities share a high level of cultural bonding and inter-marriages. Almost all border communities/tribes such as Masai, Urundi and Rwandese cut- across the border lines and extend into Kenya, Burundi and Rwanda respectively. This implies that cross border regulatory regimes are considered interruptive to their social standing and harmony. vi. Technological:- Limited or lack of ICT knowledge and skills on both sides Burundi, Kenya, Uganda and Rwanda to conduct business with computers, internet and smart telephones. There is urgency to introduce computer related skills from the project design to implementation. The trade hub will be operated on the ICT platform in order to deliver real-time services. It will also create a quick/easy means to transact with border agencies which are already using high-tech to provide down-loads to ASY-World application, clearance service messages - SMS. Score 3 h). Level of resistance to change of the agents of the border agencies. The level of resistance to change by the border agencies’ officials had a common thread cutting across all the border posts at Rusumo, Kabanga, Namanga and Mutukula to be:- i. Attitudes of maintaining the status quo and order by border agencies was said to be prevalent. ii. Indifference to the plight, suffering and difficulties experienced by Women traders is a common occurrence. iii. New technologies, reforms, procedures/ processes introduced through institutional reforms to cause simplified, clarified and transparent trade regimes are disregarded or implemented in peace meals. For instance, the EAC Simplified certificate of origin value threshold of CIF $2000 is still not yet implemented but instead CIF $500 is applied on the basis of lack of COO documentation. iv. Lack of knowledge and respect of gender issues segregated and peculiar for Women, Men and Children operating at these border posts. v. High focus and overzealous on tax collection by Customs without any reasonable concern and understanding about women concerns and questions that beg answers/explanations during the process of trade transactions and tax assessments. Score 2 Part II. Visit the border agencies to introduce the project and identify the best place to establish the trade hub: a). Identify opportunities for networking between trade hub agents and customs agents at border The following networking opportunities would obtain for Trade Hub Agents (THA) at both border posts of Rusumo, Kabanga, Namanga and Mutukula:- - The national WICBT association should apply to TRA – Customs to secure the licences of offering clearing services. Then the national WICBT would register their membership with clearing fraternity both at their head office and border posts. Then WICBT associations at border posts would be eligible to assist their members and extend clearing services to all interested ICBTs. 10 VOCBA is a national micro-financing institution that assist and enable low income earners and groups to access low interest financing.
  • 28. INT/71/14A Trade facilitation for women informal cross-border traders and MSMEs in the East African Community - phase II - Being a member of the customs agents’ fraternity may create further multiplier opportunities such as sharing or using the agents’ office counter within the OSBP facility as ‘a point of sale or help-desk’ for the WICBT members. Note that as matter of JBC border governance policy, WICBT in their current state don’t qualify to have space within the OSBP. - There are more cooperation and linkage opportunities to quickly interface with Customs Agents Clearing Associations and their members. - Polite Customs agents are most likely to extend support to the trade hub agent and also aid WICBT members in the process of clearances across border once WICBT associations become formal and attained membership to customs agents associations. - Interaction and network opportunities for women would increase to get familiar and assisted by their cross border counter-part trade hubs and customs agents, WICBT associations in smoothening coordination with each other in the community (EAC) neighbours. - Trade hub agents would be enabled to enjoy the benefits of interconnectivity, border management, modernization and collaboration with the existing automated border agencies. Score 2 b). Identify agreement opportunities to provide women facilities in local customs for the provision of services with support of experts / agencies A number of the agreement opportunities have been identified for the local customs to agree to provide services with support of agencies. These includes:- - TRA – Customs welcomes a legal entity and encourages such associations to enter discussions of mutual agreement that may lead to signing an MOU. The MOU would qualify for interconnectivity and user rights for TANCIS system for purposes of getting the Trade Hub connected onto their e-Customs clearance system and network. - The JBCs encourages individual WICBT associations at their locations to make a formal application for membership and recognition. The positive approval opens the possibility of getting WICBT leadership represented on the JBC governance structures at every designated OSBP border post. - JBC Chairpersons would always invite WICBT association members to participate with other OGA’s during their sensitization sessions and key meetings. - Customs was also interested in playing a key role of involving the WICBT members in their regular public-private sensitization sessions in accordance with their calendar of activities. Reciprocal invitations by the WICBT Associations would be extended to border agencies for their functions. - Provision and putting up the notice board the list of EAC sensitive commodities that reflect tariff free components, VAT able commodities and exemption/remission regimes translated in three languages English and Kiswahili. - ITC should be persuaded to fund the Trade Hub project for the next two years (2015/2016) till capacity in management and operationalizing the trade hub is achieved by WICBT - Other Strategic Partners: Cross-Border local governments; relevant sector National Ministries ( e.g. Other Trade Support Institutions, Local NGOs, Trade, Internal Affairs), Customs administrations and Revenue Authorities, EAC Secretariat, GIZ, JICA, European Commission, UNDP, USAID, WB and TMEA. Score 2 Part III. Conduct an inventory of existing infrastructures that can facilitate the establishment of the hub: a). Premises available for Trade Hub Rusumo border post has a near-complete construction of the OSBP facility. The external proximity of the OSBP facility is sprawling town with highly built but modest commercial and residential structures. The town is crammed onto a narrow and steep sloping landscape. The existing facilities are fully occupied and rented highly compared to other townships. It possible to negotiate for rented premises that can serve the purpose for establishing the trade hub (see Fig24). Kabanga border post is undergoing massive reconstruction on a new site and location into an OSBP facility. The new location is about 1.5 km away from Kabanga trading center and 1 km from the old Customs offices. There are plenty of premises in the town center and just opposite the old customs offices (see fig 25) but with such a walking distance. Therefore, such a distance will favor the ‘trade hub outside’ the OSBP facility. The planned ‘entry inside’ the OSBP facility must start now so that by the time the facility is ready for entry early next year, WICBT with also have gotten prepared “The Chairperson of the Namanga border post and its township are well developed to secure any amount premises needed. The fig 26 below is one section of the street road off the main road. OSBP development has spurred further growth and expansion on the town that has attracted both commercial and residential units to spring up. Therefore depending on the option of acquiring the premises for the trade hub, there are many houses potential Mutukula border post on the other hand is equally structured similarly like Namanga. There is a fully completed OSBP facility simply waiting commissioning anytime the juxtaposed facility on the Ugandan side is completed. The external proximity of the OSBP especially the opposite side is sprawling town with highly built commercial and residential structures to serve every option decided (renting to purchase) on establishing a trade hub (see fig 27). During the joint meeting we held with the joint border committee chairperson and head of Immigration, he acknowledged the active participation of the WICBT members. Fortunately, the WICBT at Mutukula is
  • 29. INT/71/14A Trade facilitation for women informal cross-border traders and MSMEs in the East African Community - phase II Fig: 24 JBC extended the promise to the Women ICBT Chairperson to approach him for consideration on space allocation after the completion and opening of the OSBP facility”. Fig: 25 for renting (other options) both at nearby the OSBP premises and adjacent the road within a radius of 100 meter’s. The JBC chairperson indicated that “the absence of any formal WICBT group, no space was provided. However with the shift into the new facility, possibilities could be explored”. Fig: 26 likely to receive a rare opportunity of being considered to for space to host the trade hub if it was established for piloting. Fig: 27 Score 2 2 2 2 b). Electricity There is full supply of grid- electricity, solar energy and stand-by generating sets provided by the OSBP facility projects (see figures 28 and 29 below). That eases possibility of getting connected after formalities of application to the electricity service providers or JBC utilities unit. There is occasional loading-shedding that was mentioned which may requires provision of a stand-by generator or/and solar panels for solar energy installation to power trade hub equipment and lighting. Fig: 28 Fig: 29 Fig: 30 Score 2 c). Internet Connection Throughout the border posts, most of the key agencies especially Customs and Immigration were found to have their own Wi-Fi connectivity for their local area networks (see figures 29 and 30 above). Mobile Dongos or modems connectivity is also supported by the mobile telecommunications service providers (Vodacom, Smart & Zantel) for the internet installations. There are also internet roaming services available almost throughout the country trading/township centers. Most key agencies such as Customs, Immigration/Police were found to operate local area Internet connections and networks. It was established that through Mobile Dongos or modems of the Vodacom & Zantel telecom companies, internet services can be conveniently secured and installed. Score 2 d). Telephone Connection Land-line telephone cables/lines were found dilapidated but existing and not in use. In some border posts telephone lines were still connected and functioning but not popularly in use (see figure 30 above- common to all border posts). Even those offices with cable telephones that are connected still prefer to use mobile telephony which is handy and in common usage by all agencies and WICBTs members. In fact many WICBTs who participated in our FGD were holding mobile telephone sets. These wireless telecommunications service providers were readily available from Vodacom and Zantel telephone companies. Score 2 e). Estimated Operating Costs At the moment the operations cost of establishing a functional and fully-equipped trade hub is not yet fully guaranteed at any of the four surveyed all OSBP border posts i.e. Rusumo, Kabanga, Namanga and Mutukula other than promised indications. The two assumed and estimated start-up costs for scenario (i) & scenario (ii) are based on two premises i.e. operating while inside the OSBP facility at USD$18,600 and/or outside the OSBP facility at USD$43,700. The additional costs for scenario (ii) is intended to cater for trade hub services related to capacity building that cannot be conducted while operating inside the OSBP facility (i). Operating Trade Hub inside the OSBP facility as a central point where women ICBTs/MSMEs can access assistance related to