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Abstract

This analysis employs cointegration methods and semiparametric regression in order to assess the integration of maize markets and the factors determining national and cross-national transmission of price signals in Sub-Saharan Africa. We use a rich dataset of 16 series of wholesale maize prices between 2000 and 2008 for Kenya, Tanzanian and Uganda. Distance is shown to have a significant nonlinear impact on the transmission of information - modelled using a semi-parametric partially linear model. Border effects are found to be heterogeneous. The empirical results provide strong evidence that the Tanzanian market is isolated from the rest of East Africa and internally fragmented.

Trademark rights play a significant role in the proper functioning of a common market of a given regional bloc. Experience teaches that, unless national trade mark regimes of individual countries cooperating in a given regional bloc such as the East African Community (EAC) are integrated into a common market, trademark proprietors may invoke their intellectual property rights to dissect the common market into different national markets and in that way blocking the free movement of trademarked goods from one part of the common market to the other. This book is therefore intended as guideline when addressing the challenges posed on a regional common market by the absence of a common market for trademarked goods. The study provides for legal techniques through which the latter market may be established to compliment an existing common market as a policy choice in favour of the principle of free movement of goods. To this end, the book analyses key principles that govern the EU's community trade mark system and determines the extent to which these principles may be adapted to suit the EAC common market.

Despite the factors making cross-border movement of goods complex and unpredictable, the latter plays a critical role in international trade. However, the EAC has introduced single customs territory to respond to the factors affecting the movement of goods and enhance trade within the region. This study then assesses the extent to which EACSCT affects the movement of goods across the Rwandan customs posts. The study used primary data collected on the perceptions of various trading agents on the implementation of the EACSCT, aspects of trade facilitation and movement of goods. Descriptive statistics and Multi-Level Model were used to analyse data and for estimates. The findings indicate that the EACSCT is successfully implemented along the Rwandan customs posts as rated good by various groups of trading agents. The level of trade facilitation is rated very high and the movement of goods has, to a large extent, been facilitated along the Rwandan customs posts. The findings also reveal that the EACSCT has significantly and positively affected the movement of goods along the Rwandan customs posts. These findings give an understanding that the EACSCT has significantly reduced or removed the barriers to the movement of goods by enhancing the level of trade facilitation. It is expected that 1-unit increase in the level of trade facilitation will make the barriers to the movement to fall by 1.133 points. Hence, calling for all border crossing agencies and stakeholders to work in synergy to continue streamlining the level of trade facilitation.

Informal cross border trade (ICBT) includes imports and exports that are traded across borders informally by escaping the normal border procedures like customs clearance. As a consequence of the said informality, ICBT is viewed as illegal cross border activities. Despite the fact that it is not possible to give the accurate extent of ICBT in the East African Community (EAC), it continues to grow by the day and has contributed significantly to economic and sustainable growth. It therefore has the potential to support the ongoing initiatives on poverty reduction and raise the standards of living for a majority of the people. In fact, if properly managed, it definitely has the effect of boosting the economies. The concept therefore that ICBT is illegal trade shows that legislators have not fully appreciated the benefits of this trade and the fact that they have downplayed it means overlooking a significant proportion of trade. The main aim of the study therefore is to give an overview of the nature and scope as well as the significance of ICBT in EAC. In this regard, the three major advantages are that it is a source of employment, assists in eradicating poverty and contributes immensely towards food security in the region. The study also analyzes the Customs Union Protocol and highlights opportunities that can be derived from specific articles for the benefit of the informal cross border traders and eventually comes up with policy recommendations to provide a regulatory environment that can accommodate both the formal and informal sector without harming either of the two. The research has also discussed the regional integration initiatives taken with the aim of promoting economic development in the Community and their effect on ICBT. The route taken by Africa as a whole is market integration which has not been without difficulties. As an alternative, regionalism from below could be the better way forward in the quest for regional economic integration considering ICBT has greatly supported the shrinking formal economy. This would mean tapping into this informal trade by building on those informal trade networks to create a robust economy bearing in mind that is where a substantial proportion of cross-border trade is conducted. This would ultimately lead to formalizing ICBT. While it may seem difficult, the study shows that formalizing ICBT and having its official recognition in the Customs Union Protocol would be a stepping stone to realizing economic integration within the Community. It is a kind of trade that is there to stay and as a result of the shrinking formal economy; EAC will with time have to deal with ICBT as a parallel and alternative source of employment in relation to the formal sector. Therefore, it is necessary that the Community deals with ICBT sooner rather than later considering it has become a social-economic lifestyle for a large number of EAC citizens.

In the first part of the report of the GTZ expert group an overview on the basics of integration and tax harmonisation within a common market is given. Chapter II. concentrates on the problems of national and international tax law regarding double taxation before the harmonisation process within the EU is described in detail. This process is not a best practice example but at least the experiences made in the course of the last five decades are interesting enough and might contribute important information for regions, which more or less recently have started a similar endeavour. The harmonisation needs are discussed for value added taxation (VAT), excise taxation, and income taxation. The problems of tax administrations, procedures laws, taxpayers' rights and obligations as well as tax compliance are also taken into consideration. The second part of the study reviews the national tax systems within the EAC member countries. Before the single taxes are described in more detail, the macroeconomic situation is illuminated by some basic figures and the current stand of the inner-community integration analysed. Then the single tax bases and tax rates are confronted to shed some light on the necessities for the development of a common market within the near future. Again the value added tax laws, excise taxes and income taxes are discussed in detail, while regarding the latter the focus is on company taxation. For a better systematic analysis the national tax laws are confronted within an overview. The chapter is closed with a summary of the tax rates applied and a rough estimation of the tax burdens within the Partner States. The third part of this report contains the policy recommendations of the expert group following the same structures as the chapters before and presenting the results for the VAT, the excises and the corporate income tax (CIT). Additionally the requirements for tax procedures and administration as well as problems of transparency and information exchange are discussed in detail before the strategic recommendations are derived in close relation to the experiences made within the EU harmonisation process. The recommendations are based on the following normative arguments: (1) Tax harmonisation is a basic requirement for economic integration. (2) Equality of taxation is an imperative of tax justice and demands the avoidance of double taxation as well as the combat of tax evasion and corruption. (3) The avoidance of harmful tax competition between the Partner States. (4) The strengthening of taxpayers' rights in tax procedures. Hence, all kinds of income, goods and services should be taxed once and only once.