From commercial to regulatory formalities, export procedures are often burdensome and time consuming for the average businessperson. Small delays in the implementation of any of these or more procedures have the potential to bring serious negative impact on businesses.
“Buyers’ minds are often directed at obtaining a quality service or product, and in a timely manner. They are not too empathetic on procedural issues on the suppliers’ side. This burden is the exporters’ and cannot be shifted to anyone else,” explains Octavian Kiviryo, an expert in freight and logistics who has worked with many exporting businesses in Tanzania.
Certificates of Origin (CoO) are important and mandatory pieces of documentation for the export business. As the name suggests, CoO details the origin of goods in a consignment. For a long time, a CoO cumbersome procedural requirement slowed down the exporting process from Tanzania. Tanzania Chamber of Commerce, Industry and Agriculture (TCCIA) and Zanzibar National Chamber of Commerce, Industry & Agriculture (ZNCCIA) are the institutions vested with the full mandate of verifying the origin of all goods manufactured or processed in Tanzania for the export market and therefore, the issuance of the Certificates of Origin. For a long time, they used manual process, that was littered with a lot of paper-work and multiple visits by traders to offices. Today, and with support from TradeMark Africa (TMA) the two institutions have adopted an electronic system for application of CoO greatly cutting back on transaction costs and time traders incurred.
This is premised on the fact that manual trade processes not only slow down exporters, but also discourage them from reaching their optimal volumes of exports. It is expected that, only when critical trade systems are fully electronic,
will the country’s export potential begin to be fully experienced. Traders agree. Bavon Ndumbati, Export Coordinator for Tanzania Distilleries Limited has managed exports for his company for close to a decade. He recalls the timeline he had to go through to obtain certificates of origin for his shipments.
“Before you would collect your certificate, you would have to go to at least three places. First you would need to collect the forms at TCCIA, then go to bank to pay. Then you would need to go back to TCCIA with proof of payment, before the certificate can be processed. You would then receive the certificate in soft copy at TCCIA, after which you would be required to find a printer, print out the certificate and take it back to TCCIA for signing.” This, according to him, translates into a significant loss in time chasing export permits.
Bavon estimates that the manual system took between 4 and 6 hours to complete one certificate, something he says distracted him from focusing on other tasks which could increase his company’s export potential. Tanzania Distilleries exports to Rwanda, Kenya and Zambia and flags off an average of 16 trucks every month; which totals up to 16 certificates of origin and 16 Tanzania Food and Drugs Agency (TFDA) licenses every month. He reflects on TMA’s support in implementation of the electronic system of issuing permits, saying he can now get those permits almost instantly after making an online application and without any physical movement.
Unlike the manual process which was full of errors and led to rejection of the Certificates of Origin in some countries; the electronic application system has returned almost nil errors, because the process is computer aided. Hamad Hamad, Executive Director of ZNCCIA remarks that there were multiple cases in the past, where Rwanda and China rejected ZNCCIA certificates of origin due to faulty signatures.
Fatma Hamis, Executive Director at TCCIA still sees potential to further redeem precious time for exporters. She says, “the next phase of support from TMA will go towards designing an electronic payment system, which will eliminate the need for physical movement to the bank to pay for the certificates.” When this has been implemented, TCCIA hopes that electronic certificates of origin will be processed and obtained almost instantly after application.
“We hope the smooth and swift process of obtaining certificates of origin will motivate more local traders to look at foreign markets,” says Fatma. When the country is taking more products to other countries, it does not only position its economy to grow, but it also builds its reputation as a worthy business partner for those countries. Such an image can last for generations.
It is vital that the label ‘Made in Tanzania’ carries a positive association to buyers outside the country. This, among other things, comes with increased exporting capacity. Thus, TCCIA and ZNCCIA’s improved efficiency in issuing certificates of origin is a step in the right direction in strengthening the national brand; and TMA is at hand to accelerate this process.
