Kampala. A consensus to allow Uganda export sugar to Tanzania has been reached by the two East African countries, according to a report following the 2nd Session of the Joint Permanent Commission meeting held in Kampala last week.
However, according to the report, such exports will only be allowed during periods of scarcity.
The meeting followed reports that Tanzania had slapped a 25 per cent Import Duty on a number of Ugandan goods such as sugar and sweets, among others.
Such goods are zero rated (tax free) under the East Africa Common Market protocol.
The meeting, which was attended by permanent secretaries from the two EAC countries also singled out sugar manufacturing as one of the areas where Uganda produces a surplus that averages at about 40,000 tonnes annually.
“The meeting agreed that where there is a deficit, Tanzania should give first preference to source sugar from Uganda. If there is any doubt about the origin, then verification can be conducted,” the report reads in part.
In July Presidents Museveni and his Tanzania counterpart, John Pombe Magufuli discussed a decision by Tanzanian Customs to deny Ugandan sugar entry into the country.
Mr Magufuli cited reports that Uganda had been importing sugar and re-exported to Tanzania, which betrayed the rules of origin as prescribed by the Common Market Protocol.
In May Tanzania had denied entry of about 600 tonnes of sugar that had been exported by Kakira Sugar Works. In an interview, Mr Jim Mwine Kabeho, the chairman of Uganda Sugar Manufacturers’ Association, noted that the Tanzanian market was difficult to access because some officials have been adamant and tend to operate in total disregard of the EAC agenda.
“We recalled hundreds of tonnes of sugar that we had sent to Tanzania. It was stopped from entering through Mwanza. After a month when we realised it was going to get spoilt because of absorbing water. We shipped it back,” he said.
This, he said, happened after a February Summit where presidents, Magufuli and Museveni, had resolved that the two countries support each other’s exports.
“The officials there [Tanzania] refused to grant access. These challenges keep coming up yet we are in the community – EAC,” he said.
In an earlier interview, Amb Julius Onen, the Trade Ministry permanent secretary, said Uganda would propose a quota system that allows member countries to be first options in the event that there is scarcity within the region. With the quota system, he said, EAC member states will be given the first shot in case of scarcity.