The East African dairy sector has become a focal point for regional tensions, as Kenya, Uganda, Rwanda, and Tanzania grapple over market access and protectionist policies. Amid efforts by East African Community (EAC) nations to strengthen economic ties, the dairy industry exemplifies the complexities of intra-regional trade, revealing both shared ambitions and competing national priorities.
EAC Dairy Trade Struggles and the Politics of Protectionism
At a recent East African Business Council (EABC) meeting in Kigali, Rwandan dairy exporters shared how Tanzania’s $1 per liter levy on imported milk has substantially increased costs, creating a barrier for Rwandan milk in the Tanzanian market. Similar challenges exist across the region, with each country setting unique regulations to protect its local dairy industries.
In Kenya, restrictions have led to delays and permit denials for milk imports from Uganda, leaving companies like Brookside Dairy Uganda unable to access the Kenyan market. Over the years, despite political agreements, dairy products from Uganda have faced continual challenges in Kenya. Compounding the issue are regulatory agencies across the EAC—such as the Kenya Dairy Board and the Tanzania Dairy Board—which oversee import permits, often causing further delays in milk trade.
Political Intervention and Unresolved Barriers
Recent bilateral discussions between Kenyan President William Ruto and Ugandan President Yoweri Museveni aimed to resolve these ongoing trade issues by ensuring compliance with the EAC’s Customs Union and Common Market protocols. However, enforcing these agreements remains difficult, with EAC Secretary-General Veronicah Nduva citing lack of consistent political support and implementation.
While some products have resumed cross-border movement, significant challenges linger, particularly with Uganda’s Brookside Dairy, which remains barred from the Kenyan market. Efforts to enhance dairy trade freedom face resistance not only from regulatory hurdles but also from political dynamics, which include competition between high-profile dairy producers in both countries.
Economic Impact and Calls for Regional Collaboration
Beyond business restrictions, the EAC dairy sector plays a crucial role in supporting regional livelihoods, providing direct employment to over 750,000 people and sustaining 1.8 million households across the community. With these livelihoods at stake, EABC board members advocate for an open-market approach, encouraging member states to consider the broader economic benefits of intra-regional trade rather than individual national interests.
While the dairy trade continues to stir political debate and regulatory scrutiny, the EAC Secretariat has proposed greater collaboration through joint product verifications, which could confirm product origins and reduce trade barriers. This approach may also ease challenges related to the Rules of Origin, which presently create obstacles for cross-border trade of milk powder.
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