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

standards, which kindly share the minutes of the meeting. Input from Burundi consisted in generalremarks on the need to revise EAC standards to cope with development on international standards andregional trade issues. Meeting discussions centered on measurement units for powdered hair dye and onthe heavy-metal content of whisky, brandy and vodka. While certainly crucial to the welfare ofpopulations, these items might not have been so much at the center of the discussions if substantialpreparatory work and consultations with the private sector had taken place prior to the meeting.In view of the concerns raised by the private sector to the mission during interviews, substantialengagement of the national authorities and particularly the Bureau of Standards, is crucial.Already, the fiscal-regulatory environment is perceived as too heavy for some activities that couldgenerate jobs and export earnings to the country, including the provision of services for the subregion.For instance, one of the country’s domestic producers, having strong technical know-how, couldbe, economically, in a position to provide repair and maintenance services for diesel engines to a rangeof clients in the region, given his unique expertise in the area. However, the customs clearanceprocedures involved in the import and re-export of an engine for repair from a neighboring country, andin the import of spare parts from Europe, would be so daunting as to discourage the activity altogether.For instance, assuming that the engine was shipped by a Rwandan customer for repair in Bujumbura, itwould have to carry a temporary export declaration including origin documentation on the engine(however old it was) and security deposits both for Rwanda’s and Burundi’s customs. Imported spareparts would carry 10% duties in addition to the VAT, unless some agreement was reached with OBR,which would likely involve numerous discussions whose result could anyway be overturned later on.Adding more controls on top of such an environment would just make things worse.There are also issues and a clear capacity deficit concerning quality control, certification and preshipmentinspection. To be effective, BBN’s involvement in quality control would require that itsresources be sufficiently stable to ensure that its controllers were offered attractive remunerations.Otherwise, incentives would grow over time to use controls to demand side payments. It is not clear thatthe ambitious hiring currently considered is sustainable in this regard. Moreover, SGS’ (the pre-shipmentinspection firm) involvement in quality control, which is being considered in the context of negotiationsover the renewal of its contract, might bring in recognized expertise in the enforcement of technicalregulations. However, the record so far is less than compelling, as the company’s involvement incustoms-clearance procedures is widely reported to be a source of complications. Whereas no onechallenges the company’s know-how and all recognize the professionalism of its Bujumbura staff,doubts are expressed about the credibility of the pre-shipment inspections, as SGS offices abroad aresuspected of only performing cursory checks of the paperwork, albeit at the cost of substantial delays.The perception of many of Burundi’s economic operators is that, because of their small scale, their filesare not always given top priority by the company. For instance, it is frequently the case that paperworksent from neighboring EAC countries on the internet manages to reach Bujumbura after the truck, alogistics performance. Bureau Veritas’ operations, which concern exporters to the DRC, are even lessstreamlined, involving extraordinarily circuitous paperwork and resulting in unacceptable delays.More than the proliferation of rules and controls, what is needed today in Burundi is aclarification of effectively applicable rules and tighter coordination across government agencies.For instance, there is uncertainty surrounding licensing requirements, which are largely used to enforce avariety of regulations (rather than as quantitative restrictions). Economic operators indicated to themission that it was not entirely clear if export licenses, granted by the Central Bank, were still requiredfor exports within the EAC zone. They are said to have been eliminated, but Customs apparently stillrequires them. Conflicting messages across administrations and ministries are apparently frequent, and,for the private sector, it is never entirely clear whether inconsistencies reflect mere disorganization or awillful practice designed to “corner” users into resorting to side-payments.83 / 153