Decision by Rwanda and Uganda to impose 75% import duty on Tanzanian rice exports in contravention of East African Community (EAC) Customs Union Protocol is under scrutiny.

Responding to Tanzania’s rice exporters, the EAC Secretariat said in a statement on Thursday that: “We know the issue and that the countries are negotiating a settlement.”

Under EAC Customs Union, rice originating from Tanzania is supposed to attract no import duty in both Rwanda and Uganda.

The EAC Secretariat did not give details on the status of the talks and when will a final decision be arrived at. Kilombero Plantation Limited (KPL)’s Chief Executive Officer, Carter Coleman said the Rwandan and Ugandan tariffs are illegal although the two countries are citing rice imports from Asia which entered the domestic market last year.

“While the government of Tanzania got the rice exemption from the EAC Council of Ministers, the Ugandan and Rwandan tariffs are surely illegal,” Mr Coleman said in an email response.

He said local rice producers are struggling to dispose of their commodity at a profit because the domestic market is still saturated with the product due to a bumper harvest and imports.

“The East African Community (EAC) should stop the Rwanda and Uganda revenue authorities from the illegal 75 per cent tariff that Uganda and Rwanda are still levying on Tanzania rice as a result of last year’s exemption,” he pointed out.

Coleman warned that such arbitrary tariff hikes affect regional trade as defined by EA Customs Union Protocol. Early last year, the government endorsed a 60,000 metric tons of rice imports from Asian to offset an artificial deficit created by traders seeking to import the cheap commodity from Asia.

After almost half of the rice imports entered the domestic market, local farmers denounced the move after prices plummeted by close to 50 per cent.

KPL which works with over 20,000 smallholder farmers still has 1,000 tonnes of rice from the 2012 season and another 5,000 tonnes from last season which is struggling to sell in the domestic market. Agriculture, Food Security and Cooperatives Minister, Eng.

Christopher Chiza suspended the rice imports in March of last year following complaints from local producers and donors.

Eng. Chiza said the government had approved the imports to help lower prices as local rice farmers were accused of hoarding the commodity which forced prices to peak at over 2,000/- a kilogram and was feared to fuel inflation.

Source: Daily News

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