(DTIS) Update, Volume 1 – Main report - Enhanced Integrated ...

Figure 2.5: Improvements in doing business reforms 54Source: Doing Business in East Africa (2011)4. Leveraging regional integration to accelerate Burundi’s trade and regulatory reformsWhile EAC membership represents both large potential benefits and challenges for Burundi, the countryhas a large deficit of technical and institutional capacity, and the challenges to develop a coherent andeffective regional integration policy are enormous. Chief among those challenges and concerns are:Burundi faces significant challenges with the removal of priority NTBs. As noted above, this issue isproblematic in all EAC member countries. Burundi has established a National Monitoring Committee(NMC) for the identification and removal of NTBs in 2008, composed of individuals from the public andprivate sectors. The NMC presented a first preliminary report on the identification of NTBs in Burundiin 2010 (Republic of Burundi 2010b) and consultations and workshops with public and privatestakeholders were organized in 2010/2011. However, as recognized in its 2010 report, the concreteaction of the monitoring committee has so far been significantly hampered by inadequate capacity andresources. Beside the issue of insufficient capacity, the limited progress so far is likely to be partly due topolitical economy resistances from actors who may have interests in the maintaining of NTBs. Copingwith these resistances will require both consultations with all the actors concerned and strong politicalcommitment from the authorities. In the coming years, additional support on trade facilitation and NTBremoval will be available from the capacity-building program focused on regional integration thatTradeMark East Africa implements in Burundi.Burundi also faces important challenges with the application of the EAC’s rules of origin (ROO).The functioning of the custom union requires the application of the Community’s ROO to distinguishbetween goods produced within the EAC, and therefore eligible for EAC preferential treatment, andthose produced in third countries, to which the CET applies. This issue is not specific to Burundi: severalreports have highlighted difficulties in the application of the ROO several years after the establishmentof the CU (varying interpretation of the rules in partner countries, absence of mutual recognition ofcertificates of origin, administrative red-tape and delays in issuing certificates, etc.), which all affectexporters and encourage fraud (World Bank 2008a; Mugisa et al. 2009). In the future, the EAC rules oforigin are expected to be simplified and harmonized with that of the COMESA and SADC, in theframework of the Tripartite Free Trade Area under negotiations since June 2011. 55Burundi has made progress with the adoption of the relevant EAC laws and regulations regardingcustoms operations and trade facilitation, but implementation is lagging behind. The adoption of anew Customs Code in 2007 has set the ground for customs modernization, but its application has beenmixed to date (UNCTAD 2010). Customs procedures remain uncoordinated and particularly54 A reform is counted as 1 reform per reforming economy per year55 See: http://www.comesa-eac-sadc-tripartite.org/node/10751 / 153