$79m World Bank grant to tackle corruption at EA borders

About 80,000 traders in the region whose livelihoods depend on cross-border trade are set to find issues such as queuing, corruption and unfair taxes tackled through a $79 million World Bank grant.

The funding will support the Great Lakes Trade Facilitation Project which aims to reduce costs faced by traders in east Africa's surrounding border areas.

It will also help to develop regional markets near border crossings and facilities to handle an increased flow of goods, services, and people, as well as provide resources to strengthen government agencies at the border to deliver better quality and efficient services.

“Regional approaches to trade facilitation are critical to leverage national efforts,” said Makhtar Diop, World Bank Group Vice President for the Africa Region.

“The three Great Lakes countries included in this project share similar challenges that must be tackled through collective action, and borders are the solution provided they are safe and enable traders to do business in a conducive environment.”

Hindering growth

According to the financial institution, “inefficiency and corruption persist at border crossings, imposing a significant drag on the regional economy, particularly for small traders, 8 out of 10 of whom are women.”

Key markets are situated across the border and informal cross-border trade plays a major role in linking small producers to markets.

Border crossing points, such as Petite Barrière in Goma, DRC, which averages 20,000 to 30,000 crossings a day, can become major bottlenecks for traders trying to reach potential buyers.

Teeming border crossings such as Kasindi and Mpondwe, between DRC and Uganda, or Goma and Rubavu, between the Democratic Republic of Congo and Rwanda, are difficult and made worse by the fact that border officials are themselves seeking to survive on low monthly salaries.

“There is a lot of rudeness and harassment at the border,” said Maman Bahati, a Congolese trader.

“The border agents only want money. You always have to discuss and negotiate. To cope with this, some women have no other choice but to cross illegally and sneak through the process.”

Not all of the corruption at the border is official as there are also unofficial agents who routinely rough up traders.

Most of the trade at these border crossings is small scale, usually involving individual traders on foot, and most of them trading in agricultural products. Most is “informal” trading—legal but not recorded in customs records.

The project, to be implemented over seven years, seeks to benefit some of the poorest and most vulnerable groups in the Great Lakes Region.

More trade

Part of the project will entail developing regional markets near these crossings so that traders, particularly those on foot, can quickly sell their goods, making possible more round trips per day and consequently increased income for poor families.

“We’ll be really looking to see if circumstances improve for these women and men and if they’re able to get their goods to markets across the border in a shorter time and with few negative incidents,” said Charles Kunaka, the World Bank’s co-Team Leader.

“Ultimately, we’d like to see an increase in the daily volume of trade, rising profits and revenues for traders, and better revenue generation and control for governments.”

The project will unfold in two phases, beginning with grants and credits totalling $79 million for the Democratic Republic of Congo, Rwanda, and Uganda, and a second phase totalling $61 million for the Democratic Republic of Congo, Burundi, Tanzania, and Zambia.

The project will fund construction of shelters for traders waiting at the border, automated turnstiles to facilitate more speedy passage through the border and less physical contact with, and therefore potential harassment from border officials.

This means improving circumstances for these traders can be as simple as ensuring that women inspectors handle the job of conducting searches of female traders, providing written receipts when customs dues are paid and affording traders with a reliable organisation that can receive and respond to complaints about harassment and corruption.

It will also improve security for small-scale traders through separate lanes for pedestrians, installation of lighting and cameras, as well as provision of warehouses so traders can safely store their goods.