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Zero-Tariff Policy Benefits Africa
China pushes to reach $300 billion in imports from Africa by 2024
By Godfrey Olukya 丨VOL. 15 May 2023 ·2023-04-19


Tea is among the commodities imported by China from Uganda

The volume of goods exported to China from Uganda has grown tremendously since December 2022, according to Uganda’s government figures. The reason for the increase is that Uganda was among the 10 countries that benefitted from China removing tariffs on goods exported by this group at the end of last year.   

Export boost 

According to the Uganda Bureau of Statistics, since the tariffs were removed, the monthly exports of goods to China from Uganda have increased by over 10 percent. 

The removal of tariffs has led to Ugandan businessmen exporting more goods to China and hence bringing in more income to the country,” said Ugandan President Yoweri Museveni, while addressing the nation recently. 

With effect from 1 December 2022, China granted zero-tariff treatment to 98 percent of taxable items originating from 10 least developed countries, namely, Afghanistan, Benin, Burkina Faso, Guinea-Bissau, Lesotho, Malawi, Sao Tome and Principe, Tanzania, Uganda and Zambia. This has led to Uganda’s increase in exports to China. 

I regarded that as a Christmas gift. Just a few weeks to Christmas, our partner China offered us a big opportunity to take our products to the Chinese market without paying tariffs,” said Apollo Kirenga, a Tanzanian businessman who deals in fish products.  

Kirenga said in an interview that he buys fish maw from Kenya, Uganda and Tanzania and exports it to China. He said that he has expanded his business because his country was one of the 10 that are benefitting from China’s zero-tariff policy. 

On 18 November 2022, in Uganda’s capital Kampala, while speaking at the public unveiling of the Special Preferential Tariff Treatment of Ugandan Exports to China, Zhang Lizhong, Chinese ambassador to Uganda, said the expansion follows commitments made by China at the Eighth Ministerial Conference of the Forum on China-Africa Cooperation held in Senegal in November 2021. 

Zhang said that China pledged to increase the scope of products enjoying zero-tariff treatment for least developed countries that it has diplomatic ties with, in a bid to reach $300 billion in total imports from Africa from 2022 to 2024. 

According to Chris Mutawe, an economics expert in Kampala, the move has not only raised China’s imports from least developed countries, but it will also promote economic and trade cooperation. 

A statement issued by the Chinese Embassy in Uganda on 18 November 2022 said that the policy would cover 8,786 items, including agricultural products such as olive oil, cocoa powder and nuts, as well as various chemicals and product materials. It said it is conducive to opening up with a win-win approach, building an open economy in the world, and helping least developed countries to accelerate their economic development.   

How Uganda is benefitting 

According to Matia Kasaija, Uganda’s minister of finance, planning and economic development, the country is happy to be among the 10 countries that China granted zero-tariff treatment to 98 percent of taxable items. He urged the Ugandan business community to take advantage of that offer. 

Kasaija said in a recent interview that Uganda would benefit a lot because its products have now got a bigger market in China, adding that China is a giant economy where Ugandans can tap into a lot of opportunities, especially through marketing their products. 

Francis Mwebesa, Uganda’s minister of trade, industry and cooperatives, hailed China over the tariff offer and said it is going a long way to help Uganda to promote its economy and improve the lives of its citizens. He urged the business community to take advantage of the Chinese market access. 

China is the best market we can access. The private sector, especially those in coffee, should access the Chinese market,” said Mwebesa. 

The minister also hopes China could increase its technology transfer to Uganda, saying the promotion of tourism should be at the forefront of bilateral cooperation. 

Meanwhile, Stanley Walakira, a dealer in coffee, said that since China removed tariffs on Uganda’s exports to China, he now exports more coffee than before. 

  

Visitors buy Ugandan coffee at the first China-Africa Economic and Trade Expo in Changsha, Hunan Province, on 27 June 2019

Growth of Uganda’s trade with China 

According to World Integrated Trade Solution, Uganda’s biggest trading partner is China, followed by India and Kenya. 

The latest Bank of Uganda report, which was released on 5 September 2022, indicates that Uganda’s exports to China were largely composed of oil seeds, fruits and grain. Other exports were modified starch, glues and enzymes, coffee, tea, meat and spice.  

Our trade with China is good. Every day, many Ugandans travel to China. Most of them either take products to China, or go there to buy items and bring them into our country. With the removal of tariffs, more products are going to be exported to China by Ugandan traders,” said Rogers Ocaya, a trade officer in the Ministry of Trade, Industry and Cooperatives. 

John Lwere, export promotion officer at the Uganda Export Promotion Board, agreed that with the removal of tariffs, Uganda will continue to expand its export products catalogue. He also indicated that Uganda had put a lot of emphasis on growing its coffee export to China.  

In his speech during Labour Day on 1 May 2022, President Museveni hailed China for opening up to African countries. He said that unlike some developed countries, China does not attach strings while dealing with African countries.  “China is a good trading partner. China has a lot of items it would like to import from Uganda. It is up to Ugandans to produce what China needs.” 

According to the Uganda Media Centre, in March 2022, while attending a one-day meeting during the Coffee Day organised by Ambassador Judyth Nsababera, consul general of Uganda in Guangzhou, south China’s Guangdong Province, Ugandan Minister of State for Foreign Affairs Okello Oryem noted that the government was committed to increasing exports to China. 

China-Africa economic cooperation has expanded rapidly in scale and extent. Over the past five years, China’s imports of African agricultural products have grown at an average annual rate of 11.4 percent, making China the second-largest export destination for African agricultural products.  

In 2021, China imported $5.03 billion of agricultural products from Africa, a year-on-year increase of 18.23 percent, reaching a record high. Last year, bilateral trade between China and Africa grew 11.1 percent year on year to reach over $282 billion, according to figures released by China’s General Administration of Customs. 

Reporting from Uganda

 

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