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Kenya defies EAC recommendation to allow imports of wheat flour from Tanzania.
Wednesday, April 12, 2017 9:14
Wheat farmer Bernard Kimani (right) and a friend prepare the grain for sale in Burnt Forest last November. FILE PHOTO | NMG
Kenya has defied a recommendation from the East African Community (EAC) secretariat to allow imports of wheat flour from Tanzania.
A report from the EAC Council of Ministers meeting last week indicate that Kenya ignored the technical guidance issued by the secretariat on February 6 calling on Kenya to allow imports of wheat products from Tanzania.
“In that guidance, among other things, they informed partner states that where wheat flour is milled from imported wheat grain in a partner state it qualifies under the EAC Rules of Origin to be accorded Community Tariff Treatment when traded between partner states,” reads a report from EAC.
However, Kenyan wheat millers have long argued that Tanzania imports its wheat products and should therefore not enjoy tax incentives under the East African Community Customs Union rule of origin, which gives preferential treatment to goods produced within the region.
Kenya responded to the EAC guidance by allowing imports of only 40 trucks of wheat flour from Said Salim Bakhresa and Co. Ltd, which has a local subsidiary in Kenya.
Tanzania’s minister of Trade said Kenya had since gone on to hold another 28 trucks of wheat products from Monaban Trading Co. Ltd, Arusha.
“In all these occasions the Republic of Kenya couldn’t provide any written document to justify their actions which go against the EAC Customs Union,” Tanzanian officials said.
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The millers further said duty free wheat product imports from Tanzania is unfair because Kenyans pay up to 50 per cent duties when exporting their products to East African Community member states, including Tanzania.
Both Kenya and Tanzania do not produce sufficient wheat locally and they rely on imports to meet the annual demand.
This makes Kenya a net importer of wheat, bringing in two-thirds of its requirement to meet the annual consumption of 900,000 metric tonnes against the annual local production of 350,000 tonnes.
The low global cost of the produce has seen millers import huge volumes of the produce in recent months.
A bag of imported wheat lands in Nairobi at about Sh2,650 against the local price of Sh3,000 that they paid to farmers in the last season.