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How a truce in the trade wars boosts business

Making gradual reform moves at home, President Samia Suluhu Hassan has moved faster to mend fences in the region and boost her country's GDP growth

Tanzania's President Samia Suluhu Hassan's regional diplomacy is gradually resolving longrunning tit-for-tat trade disputes in the region in the first few months of her tenure, the president visited nearly all EAC member states (besides South Sudan) and tabled development and trade deals.

Trade between Kenya and Tanzania crossed the 100 billion Kenyan shilling (US$1bn) mark for the first time during Suluhu's first year in office, while Tanzania's exports to Kenya exceeded imports for the first time in the six months to June 2021.

Goods traded between the two countries amounted to KSh107.63 billion in 12 months through March 2022, 67% growth over KSh64.51 billion the year before.

It has emerged that following Suluhu's Nairobi visit in May 2021, weeks after she replaced late President John Magufuli, 23 restrictive regulations that had impeded trade between Nairobi and Dar es Salaam were resolved (Dispatches, 7/5/22, President Hassan takes her charm offensive to Nairobi).

A month after Suluhu's May 2021 State visit to Kenya, a Joint Commission for Co-operation charged with eliminating non-tariff barriers between the two nations identified 60 tariff and non-tariff barriers between the two countries.

Suluhu's political will appears to have been matched in Nairobi. A report for the Kenyan Treasury shows that Kenya initially targeted the resolution of about seven non-tariff barriers (NTBs) – regulations which include licences, quotas, embargoes, foreign exchange restrictions, and import deposits – in the financial year 2021/22 but surpassed the goal to resolve 31.

Kenya's trade spat with Tanzania intensified in November 2017 when Dar es Salaam burnt 6,400 live chicks from Kenya on grounds that they were smuggled into the country.

Kenya retaliated by banning maize imported from Uganda and Tanzania, arguing that they had been infected with cancer-causing aflatoxin.

As Kenya ran short of maize however, the country turned to Tanzania to plug the deficit which, in turn, required Kenyan importers to register their firms in Dar es Salaam as the country imposed stricter rules to protect its commodities and jobs from shifting abroad.



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