Traders have been urged to take advantage of the new customs reforms to become more competitive and increase cross-border trade. According to the Rwanda Revenue Authority (RRA), some of the reforms including, the gold card scheme and authorised economic operator, offer benefits that could enhance the efficiency of local traders.
Though some of the reforms were implemented this year, the gold card facility was launched two years ago to ease goods clearance procedures for low-risk importers. Fred Nuwagaba, the RRA customs unit trade management division expert, however, said few cross-border traders have embraced the facility despite its enormous benefits.
“Goods of compliant tax-payers that hold this facility (gold card) are released immediately upon declaration at customs. This is, therefore, an instrument that eases and promotes trade that the importers should exploit to boost business,” Nuwagaba told The New Times.
The gold card scheme is intended to help customs balance its conflicting mandates of trade facilitation and enforcement and control, the expert explained. It also allows the department to facilitate low-risk consignments, allowing the agency to focus its enforcement efforts on the transactions representing “higher or unknown risk” ensuring easy flow of goods, he added.
Trade experts, however, say there is need to sensitise traders on such facilities to enhance their effectiveness and, ultimately, promote regional trade.
Kevin Umuhoza, a trade expert in Kigali, said it is RRA’s responsibility to educate traders about such facilities and the benefits they present them (business community).
Umuhoza added that few importers and exporters are aware of how compliant tax-payers can benefits the authorised economic operator offers them. The revenue body also uses the electronic single window system allowing traders to submit information and administrative requirements for imports and exports at a single entry point online.
According to Nuwagaba, the system has been supplemented by electronic cargo tracking platform to further increase efficiency of cargo handling procedures.
“We, therefore, expect that these technologies will help reduce transit monitoring, as well as operation costs besides playing a key role in reducing extended transit times,” he said.
Donatille Nibagwire, the managing director of FLORIS Export Company, challenged customs department to always give information in a timely manner to boost awareness and ensure traders benefit from such initiatives.
A 2014 study by TradeMark East Africa revealed that the adoption of a single customs territory in January 2014 has contributed to a 11.5 per cent increase in volume of goods handled at the Port of Mombasa. Landlocked countries - Rwanda and Uganda - have been able to save a combined $400 million in clearance and inland shipping costs from the port.
The five East African Community member states are now working for greater economic integration through a single, coherent and efficient market and to ensure they keep their obligations under the EAC customs union. This should provide the business community in the region greater benefits, including easy flow of goods and reduction in trade barriers and hence low cost of operations.