Background studies on East African trade

Data presented in Part One, on regional trade patterns, show that, except for Kenya, the flow of goods between countries in the region is very limited, some countries having virtually no interactions within the region. The same conclusion can be reached for East African trade with the rest of Africa. Part Two considers regional trade policies, as well as policy instruments such as quotas, tariffs, export taxes, export subsidies, and voluntary export restraints. A country-by-country review illustrates the substantial dependence of East African governments on trade for tax and fee revenue. The final section of Part Two examines some trade policy problems peculiar to East Africa, particularly the relatively small amount of intra-African trade, as well as opportunities for growth through measures such as "commodity matching" between importers and exports and the development of preferential trade areas. Part Three, an analysis of the economic characteristics of Kenya, Uganda, and Tanzania, highlights the economic dualism of the region, corridors of intense commercial activity - one extending from Nairobi to Kampala, and another to Mombasa and then along the Indian Ocean coast to Dar es Salaam - which stand in stark contrast to the moderately or sparsely populated non-corridor areas generally dependent upon subsistence agriculture. Magendo (informal trade) also plays a significant role in the region, particularly in areas of Uganda where the formal economy has disintegrated. (Author abstract, modified)