Kenya plans talks with Tanzania over new trade restrictions

NAIROBI, July 30 (Xinhua) -- Kenya announced on Wednesday that it will hold meetings with Tanzania in early August to address concerns over recently introduced "discriminatory" tax measures and trade restrictions, including a ban on non-citizens operating small-scale businesses in Tanzania.

Lee Kinyanjui, cabinet secretary in Kenya's Ministry of Investments, Trade and Industry, said the measures introduced by Tanzania on Monday threaten the gains made in regional integration under the East African Community (EAC) framework.

He raised concern over Tanzania's Finance Act 2025 and recent amendments to the Excise (Management and Tariff) Act 2019, which introduced new excise duties and an industrial development levy at rates of 10 percent and 15 percent, respectively.

He also cited the Business Licensing (Prohibition of Business Activities for Non-Citizens) Order, 2025, which bars non-Tanzanians from engaging in 15 specific sectors, including micro and small enterprises. The order, which includes stiff penalties for violations, took immediate effect, except for current license holders.

"These measures are substantive and undermine the core objectives of regional economic integration under the Common Market Protocol," Kinyanjui said, referring to the EAC's commitment to creating a single market that ensures the free movement of goods, services, capital, labor, and the rights of residence and establishment.

"Kenya requests that these restrictions be removed and that Tanzania reverts to measures provided for in the EAC protocol," Kinyanjui said.

Kinyanjui warned that the licensing order appears to criminalize otherwise lawful EAC investments and risks damaging both economies.

"It is therefore critical, in the spirit of EAC, that bilateral engagements be held to resolve these issues," he said, adding that further bilateral discussions have been scheduled to address the recent measures and other ongoing trade concerns.

According to the official, the EAC remains Kenya's largest export market, accounting for 28.1 percent of its total exports, valued at approximately 2.3 billion U.S. dollars in 2024. Tanzania is Kenya's second-largest EAC trading partner after Uganda, with bilateral trade valued at 487 million dollars this year. Enditem