Facilitating informal cross-border trade in Uganda

The International Trade Centre (ITC) in conjunction with the Uganda Export Promotion Board (UEPB) is currently implementing a project that seeks to enhance the capacity of Ugandan women informal cross-border traders (ICBTs) to increase their exports to neighbouring countries by reducing and eliminating trade facilitation impediments at points of entry and exit.

According to the 2007 Uganda Bureau of Statistics Informal Cross-Border Trade Survey, Uganda’s informal trade with her neighbours was estimated at just under US$777 million, which was 58% of the country’s formal sector exports for the same year. The growth in informal cross border exports represents   an increase of 236% on the US$ 231 million export values recorded in 2006. The majority of the Uganda’s informal cross-border traders are women, who sell their merchandise to neighbouring Sudan, Rwanda, Kenya, Democratic Republic of Congo and Tanzania.

Despite the impressive contribution and potential for growth of the informal cross-border sector, women informal cross-border traders experience a number of challenges in doing business. These include the absence of clear government policies for the development of the informal sector, lack of knowledge on formal cross border procedures and processes, lack of access to finance, lack of entrepreneurial skills, lack of marketing skills, shortage of business premises, complex government laws and regulations, lack of access to automation, low literacy levels, undue delays at border posts, and harassment by border agencies. These challenges are particularly severe for women ICBTs relative to their SME exporting counterparts in the formal sector.

The project seeks to address these challenges through a three-pronged approach:  the simplification of cross border procedures and processes for ICBTs; capacity building of women ICBTs and trade facilitation/ border agencies and; establishment of strong networks with key trade and development stakeholders, including TSIs.

The project is expected to produce several outputs: a trade facilitation  regime for Ugandan women informal cross border traders; a one stop window/fast track clearance system for  ICBTs at four of Uganda’s key borders; a customs integrity action plan for women ICBTS drafted and accepted by Uganda Revenue Authority and key trade facilitation agencies;   women ICBT trade capacity hubs launched at four Ugandan borders ; capacity building modules and technical support guidelines developed and approved by the  ICBTs; the establishment of  a Uganda ICBT Trade Facilitation Association; and the publication of a best practice guide on developing and implementing trade facilitation measures for women ICBTs. 

Although this project does not have a specific objective to encourage women ICBTs to transition to the formal export sector, it is hoped that through capacity building,

training on export opportunities, exposure to trade facilitation practices and linkages to national trade networks and resources, more women ICBTs will be encouraged to formalise their businesses and eventually grow to become SME exporters.