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East African Countries Hike Rice Import Duty To 35%

VENTURES AFRICA – The East African Community (EAC) comprising Tanzania, Burundi, Rwanda, Uganda and Kenya has increased import duty on rice in a move to discourage cheap imports of the product from Asia and protect local farmers.

Tanzania Finance Minister Saada Mkuya Salum said the import duty on rice was increased from 25 to 35 percent.

“We did this after realising that is a sensitive product (rice) which can be produced locally. The whole process was consultative and involved stakeholders from all walks of life, different ministries and other government departments,” said Salum.

There has been an outcry from rice farmers and millers in Tanzania over the influx of the cheap rice into the country from Asia, with calls for complete ban of importation of the staple food increasing in a bid to protect the local industry.

There has been similar call from rice millers in fellow East African country, Uganda, with their representative, Ambassador Phillip Idro advising East African heads of state to “revise the rice policy and ensure there is increased local production before allowing in some import”.

All Finance Ministers of the EAC were said to have signed the new proposal, except the Ugandan Minister, as Oryzaquoted local sources as saying the East African country was proposing a 75 percent increase to its import duty and increase local production of rice.

The economy of Tanzania, whose Finance Minister defended the move, depends heavily on agriculture, which accounts for more than 25 percent of Gross Domestic Product (GDP), provides 85 percent of exports, and employs 80 percent of the work force. Topography and climatic conditions, however, limit cultivated crops to only 4 percent of the land area.

Cash crops including coffee, tea, cotton, sisal and pyrethrum account for the vast majority of export earnings.

The volume of all major crops—both cash and goods, which have been marketed through official channels—have increased over the past few years, but large amounts of produce never reach the market.

Poor pricing and unreliable cash flow to farmers continue to frustrate the Tanzanian agricultural sector.