A Quantitative Assessment of the COMESA Customs Union

This study provides a quantitative assessment of the potential impacts of the formation of a COMESA customs union, specifically of having free trade among COMESA countries while imposing a common external tariff against imports from outside COMESA. The study uses an expanded version of the Global Trade Analysis Project (GTAP) database and capitalizes on the Modeling International Relationships in Applied General Equilibrium (MIRAGE) Computable General Equilibrium (CGE) model for analysis. Two different assumptions are made regarding the number of sensitive products excluded from the CET rates—2 percent or 5 percent. The simulation exercise involved four scenarios to compare the impacts of the customs union under two alternative specifications of sensitive products, and the impacts of three alternative membership assumptions on the COMESA region. The alternative COMESA customs union scenarios are designed at the detailed Harmonized System at the six digit level (HS6), combining information on the current applied protection from the 2004 MAcMap data base and the COMESA Tariff Nomenclature

Status and Trends of Agricultural and Rural Development Indicators in the COMESA Region

This report is divided into eight sections, section one provides an introduction about the COMESA region and the structure of the economy in the region. Section two presents trends of various socioeconomic indicators in the region. Section three contains gender related information while section four focuses on food security in COMESA. Some examples of subnational food security situations are also given here. Section five focuses on various indicators related to agriculture in COMESA including agriculture and food production, input utilization in agriculture, and application of irrigation in agriculture. Section six provides information on expenditures in agriculture and agricultural value addition in the region. In section seven, various indicators on trade are reviewed. The last section, section eight, contains summary, conclusions, and policy recommendations

Status, distribution and determinants of poverty in the COMESA region: A review of existing knowledge

Poverty and vulnerability are among the major problems in Eastern and Southern Africa (ESA). To design appropriate poverty reduction initiatives for the region, it is not only important to understand the distribution of poverty but also the determinants. Various reports have documented information on the status, distribution and determinants of poverty in each of the countries. Nonetheless, not much information has been documented in a form that is easily accessible to decision makers and planners involved in designing and implementing programmes for addressing poverty reduction and food insecurity at the regional level. This paper reviews the existing knowledge on the status, distribution and determinants of poverty in the ESA region to fill that knowledge gap. It emerges from the literature that poverty in the region differs across socio-economic groups and across space. The existing poverty maps suggests that most districts and provinces whose poverty rates are lower than the national averages are located in rain fed mixed crop–livestock systems and that the highest proportion of them are in the humid and sub humid systems. High poverty rates also occur in the livestock only systems. About half of the poor provinces and districts fall in areas with short growing periods; this affects their agricultural potential. The areas are also constrained by market access. Investment in irrigation, improved water management and improved market access would play a vital role in these regions. The review suggests that household level determinants of poverty in the region include, but are not limited to: household characteristics—family composition, size and structure, age and marital status of head, gender of the head, education and other human capital capabilities; access to basic services such as social amenities, water and sanitation, credit and infrastructure; employment, occupation and incomes; asset ownership; access to remittances; burden of disease; variations in agricultural production; and declining food stocks and high food prices. Community/regional/country level determinants include: geography and related factors such as market access, agro-ecological zones, climate and ethnicity; the environment; population density; area of residence (rural vs. urban); income, growth and inequality; conflict, insecurity and political instability; and governance and corruption. However, it is difficult to separate the determinants of community level poverty from the determinants at the household level. The review further suggests that the determinants of poverty are fairly robust across many COMESA countries. This suggests the need for a consultative approach to poverty reduction in the region

Common interest

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Investment Opportunities for Livestock in the North Eastern Province of Kenya: A Synthesis of Existing Knowledge

Pastoralism is the dominant livelihood activity in the North Eastern Province (NEP) of Kenya. It is supplemented only by a limited amount of agriculture along the rivers. The province faces various developmental challenges including chronic poverty and food insecurity, low human capital and poor health standards, high vulnerability to climate change, poor infrastructure, insecurity and low crop and livestock productivity. This study synthesises existing knowledge and provides recommendations on livestock investments to increase incomes, create employment and reduce food insecurity in the province. It examines investment opportunities in livestock and presents scenarios that meet the objectives of Kenya’s 2030 vision. Four scenarios are analysed. The first scenario consists of the business-as-usual case: a vision of the state of the livestock sector, and its contribution to NEP and national economy, if the current trajectory is maintained. The second scenario outlines a strategy that focuses on catering to domestic demand for livestock products. The third scenario focuses on feeding foreign demand for live animals, while the fourth scenario investigates the possibilities of a livestock sector driven by exports of processed livestock products. Also in these investment scenarios, the broad-based growth contribution to the economy is discussed. The analysis indicates that all three alternative scenarios have far better impacts on pastoralists’ income and employment than the ‘business-as-usual’ scenario. The second scenario is found to have the largest favourable impact. Besides creating jobs and income opportunities, it provides alternatives to meet the growing livestock product consumption spurred by population increase, rising incomes and urbanization in Kenya. However, there are several requirements for this scenario to work and yield the desired impact. The need for creating a favourable investment climate is discussed and specific roles of the public and private sectors are explained

The impact of non-tariff barriers on maize and beef trade in East Africa

On March 2, 2004, the East African Community (EAC) member states signed the protocol for the establishment of the East African Community Customs Union, which commits them, among others, to eliminate non-tariff barriers (NTBs) to increase intraregional trade. However, several NTBs are still applied by member states, raising concerns among policy makers and the business community. There is, however, no information about the magnitude of the impact of these NTBs. This study identifies the existing NTBs on maize and beef trade in East Africa and quantifies their impact on trade and the welfare of EAC citizens using a Spatial Equilibrium Model (SEM). Data on NTBs were collected from traders and transporters of maize and beef cattle in East Africa. In addition, the study found that the main types of NTBs within the three founding members of the EAC (Kenya, Tanzania and Uganda) are similar. They include administrative requirements (mainly licenses, municipal and council permits), taxes/duties (mainly excise and cess duty), roadblocks, customs barriers, weighbridges, licensing, corruption (e.g., through bribes) and transiting. The results of the welfare analysis vary across the three countries, but the net monetary gains are positive in all cases. A complete abolishment or a reduction of the existing NTBs in maize and beef trade increases intra-EAC maize and beef trade flows, with Kenya importing more maize from both Uganda and Tanzania, while Uganda’s beef exports to Kenya and Tanzania increase. As a result, positive net welfare gains are attained for the entire EAC maize and beef sub-sectors. In all cases, those who gain from the proposed reductions in NTBs can potentially compensate the losers, leading to potential improvements in welfare. These findings give compelling evidence in support of the elimination of NTBs within the EAC customs union. The study recommends taking a regional approach to eliminating the existing NTBs since they are similar across the member countries and across commodities so as to exploit economies of scale. Other policy recommendations include streamlining of administrative procedures at border points to improve efficiency, and speeding up the implementation of procedures at point of origin and at the border points. Finally, the study recommends the need to design and implement monitoring systems to provide feedback to the relevant authorities on the implementation of measures to remove unnecessary barriers to trade within the EAC region