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Diagnostic Trade Integration Study

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Diagnostic Trade Integration Study Volume 1 UGANDA Diagnostic Trade Integration Study R E P O T June 2006 ABBREVIATIONS AND ACCRONYMS € Euro FSAP Financial Sector Assessment Program ACP African, Caribbean, and Pacific FSSP Fisheries Sector Strategic Plan ADT Average Daily Traffic FTA Free Trade Area ADZ Aquaculture Development Zone GAFRD General Authority for Fish Resources AfDB African Development Bank Development AGOA African Growth and Opportunities Act GAP Good Agriculture Practices ASYCUDA Automated System for Customs Data GDP Gross Domestic Product BMU Beach Management Units GKMA Greater Kampala Metropolitan Area BOU Bank of Uganda GMO Genetically Modified Organisms BRC British Retail Consortium GMP Good Manufacturing Practices C&F Clearing and Forwarding GNFS Goods and Non-Factor Services CA Competent Authority GNI Gross National Income CAA Civil Aviation Authority GOK Government of Kenya CBC Customs Business Center GOU Government of Uganda CBI Centre for the Promotion of Imports from GPS Global Positioning Satellite developing countries GSP Generalised System of Preferences CBS Community Based System ha Hectare CDO Cotton Development Organization HACCP Hazard Analysis and Critical Control Points CEM Country Economic Memorandum HCDA Horticultural Crops Development Authority CEO Chief Executive Officer HORTEXA Horticulture Exporters Association CET Common External Tariff HR Human Resources CG Commissioner General ICBT Informal Cross Border Trade COMESA Common Market for Eastern and Southern ICD Inland Container Depot Africa Cooperation for Emerging Markets ICO International Coffee Organization CU Customs Union IDEA Investment in Developing Export Agriculture DAR Directorate of Animal Resources IFAD International Fund for Agricultural DCP Department of Crop Protection Development DFID Department for International Development IFS International Financial Statistics (UK) IFWG Integrated Framework Working Group DFR Department of Fisheries Resources ILM Integrated Lake Management Project DP Development Partners ILO International Labour Organisation DRC Democratic Republic of Congo IMF International Monetary Fund DTI Direct Trader Input IPPC International Plant Protection Center DTIS Diagnostic Trade Integration Study ISO International Organization for Standardization EAC East African Community IT Information Technology EBA Everything But Arms Initiative ITC International Trade Centre EDF European Development Fund IUU Illegal, Unreported and Unregulated EDI Electronic Data Interchange JICA Japan International Cooperation Agency EDP Export Development Project KEDS Kenya Export Development Services ECGS Export Credit Guarantee Scheme kg Kilogram EIB European Investment Bank KIP Kampala Inland Port EPA Economic Partnership Agreement km Kilometer EPADU Export Promotion Analysis and Development KPA Kenya Ports Authority Unit KPC Kenya Pipeline Corporation ERP Effective Rate of Protection KRA Kenya Revenue Authority ERS Export Refinance Scheme KRC Kenya Railways Corporation EU European Union Ksh Kenyan shilling EUREPGAP Euro-Retailer Produce Working Group’s Good l Litre Agricultural Practices LDC Least Developed Country FDI Foreign Direct Investment LVFO Lake Victoria Fisheries Organisation FFP Fair Flowers and Plants m Million FHL Fresh Handling Limited MAAIF Ministry of Agriculture, Animal Industry and FIRRI Fisheries Resources Research Institute Fisheries FLP Flower Label Program MCS Monitoring Control and Surveillance FMO Netherlands Development Finance Company MEMD Ministry of Energy and Mineral Development FOB Free on Board MFN Most Favored Nation Foodnet “Post-Harvest Research and Market Network MFPED Ministry of Finance, Planning and Economic for East and Central Africa” Project Development FPEAK Flower Producers and Exporters Association MICT Ministry of Information, Communications, and of Kenya Technology i MIS Market Information Systems tkm Tonne Kilometre MLG Ministry of Local Government TORs Terms of Reference MOH Ministry of Health TPA Tanzania Ports Authority MWHC Ministry of Works, Housing and TRC Tanzania Railways Corporation Communication TTCA Transit Transport Co-ordination Authority MPS Milieu Project Sierteelt TTF Transport and Trade Facilitation MTCS Medium Term Competitive Strategy TUNADO The Ugandan National Apiculture MTRA Multi-sector Transport Regulatory Authority Development Organization MTTI Ministry of Tourism, Trade, and Industry UAE United Arab Emirates MWLE Ministry of Water, Land and Environment UBOS Uganda Bureau of Statistics NAADS National Agricultural Advisory Services UCDA Uganda Coffee Development Authority NARO National Agricultural Research Organization UCGEA Uganda Cotton Growers and Exporters NEMA National Environment Management Authority Association NEPAD New Partnership for Africa’s Development UEPB Uganda Export Promotion Board NGO Non-Governmental Organization UFA Uganda Fisheries Authority NPA National Planning Authority UFEA Uganda Flower Exporters Association NRA National Roads Authority UGSTDP Uganda Sustainable Tourism Development NRP Nominal Rate of Protection Programme NTMP National Transport Master Plan UIP Uganda Integrated Program OECD Organization for Economic Co-Operation and UK United Kingdom Development UMA Uganda Manufacturers Association OIE World Organization for Animal Health UMACIS Ugandan Manufacturer Association PEAP Poverty Eradication Action Plan Consultancy and Information Services PESP Program for Economic Cooperation in UNBS Uganda National Bureau of Standards Projects UNCOMTRADE United Nations Commodity Trade PIP Pesticide Initiative Program UNCTAD United Nations Conference on Trade and PIRT Presidential Investors Roundtable Development PMA Plan for Modernization of Agriculture UNDP United Nations Development Programme PMAESA Port Management Association for Eastern and UNIDO United Nations Industrial Development Southern Africa Organization POL Petroleum Oils and Lubricants UNRA Uganda National Roads Authority PPP Purchasing Power Parity URA Uganda Revenue Authority PSD Private sector development URC Uganda Railways Corporation PSOM Programma Samenwerking Opkomende US $ United States Dollars Market Programme US United States of America PSP Private Sector Participation USAID United States Agency for International QC Quality Control Development RAFU Road Agency Formation Unit USD US Dollar REER Real Effective Exchange Rate Ush Ugandan Shilling RER Real Exchange Rate VAT Value Added Tax RMP Residue Monitoring Plan WB World Bank ROO Rule of Origin WC Working Capital RPED Regional Program for Enterprise Development WCO World Customs Organization RTA Regional Trade Arrangement WFP World Food Programme SADC South African Development Community WTO World Trade Organization SCOPE Strengthening the Competitiveness of Private ZEGA Zambia Export Growers Association Enterprise SEP Strategic Export program SIC Standard Industrial Classification SPEG Sea-freight Pineapple Exporters of Ghana SPS Sanitary and Phytosanitary SSA Sub-Saharan Africa SWOT Strengths, Weaknesses, Opportunities and Threats t Tonne TASS Technical Assistance and Support Services TAZARA Tanzania Zambia Railway Authority TBL Through Bill of Lading TBT Technical barriers to trade TEU Twenty-feet Equivalent Unit TICTS Tanzania International Container Terminal Service ii TABLE OF CONTENTS PREFACE AND ACKNOWLEDGMENTS ............................................................................................ VI EXECUTIVE SUMMARY........................................................................................................................ IX 1. CONTEXT AND BACKGROUND....................................................................................................1 1.1 ECONOMIC BACKGROUND ..........................................................................................................3 1.2 TRADE PERFORMANCE................................................................................................................6 1.3 POVERTY TRENDS AND PROFILE................................................................................................14 2. SELECTED COMPETITIVENESS ISSUES: ................................................................................18 2.1 INFLATION AND REAL EXCHANGE RATE .................................................................................18 2.2 KEY INVESTMENT CLIMATE ISSUES .........................................................................................20 3. TRADE POLICY AND REGIONAL TRADE ARRANGEMENTS ............................................24 3.1 IMPORT POLICIES......................................................................................................................24 3.2 EXPORT POLICIES .....................................................................................................................29 3.3 REGIONAL TRADE ARRANGEMENTS.........................................................................................30 3.4 TRADE POLICY AND POVERTY..................................................................................................35 4. INSTITUTIONS FOR TRADE POLICY........................................................................................38 4.1 INSTITUTIONS FOR TRADE POLICY...........................................................................................38 4.2 INSTITUTIONS FOR EXPORT DEVELOPMENT ............................................................................46 5. SANITARY, PHYTOSANITARY AND OTHER STANDARDS .................................................53 5.1 STANDARDS, SPS MANAGEMENT AND TRADE:
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