NATIONAL STRATEGY FOR ELIMINATING NON-TARIFF BARRIERS (NTBs)

Transcription

1 Ministry of Trade and Industry (MINICOM) In cooperation with Trademark East Africa NATIONAL STRATEGY FOR ELIMINATING NON-TARIFF BARRIERS (NTBs) October, 2011 October

2 TABLE OF CONTENTS LIST OF TABLES AND FIGURES EXECUTIVE SUMMARY INTRODUCTION NTBS AND RWANDA PERFORMANCE IN REGIONAL TRADE RWANDA NATIONAL MONITORING COMMITTEE ON NTBS STAKEHOLDERS ANALYSIS NATIONAL MONITORING COMMITTEE ON NTBS PRIVATE SECTOR Private Sector Federation Private Sector Organisations OTHER PUBLIC INSTITUTIONS NMC SWOT ANALYSIS... ERROR! BOOKMARK NOT DEFINED. 5 STRATEGIC FRAMEWORK NMC GOAL STRATEGIC OUTCOMES STRATEGIC OUTPUTS NMC COMMUNICATION STRATEGY OBJECTIVES AND STAKEHOLDERS COMMUNICATION STRATEGY OVERVIEW COMMUNICATION ACTIVITIES/TOOLS IMPLEMENTATION FRAMEWORK ANNEX 1: Strategy Implementation Matrix ANNEX 2: Monitoring and Evaluation Matrix ANNEX 3: NTB Research Paper Template ANNEX 5: Time-Bound Programme for Elimination of NTBs October

3 List of Tables and Figures List of Tables TABLE 1: COMPARATIVE OVERVIEW OF RANKING BETWEEN RWANDA AND REGIONAL ECONOMIES IN WB DOING BUSINESS SURVEY TABLE 2: RWANDA S RANKING IN WB DOING BUSINESS REPORTS TABLE 3: NMC COMMUNICATION STAKEHOLDERS TABLE 4: OUTLINE OF NMC COMMUNICATION STRATEGY List of Figures FIGURE 1: RWANDA S RANKINGS IN WB DOING BUSINESS REPORTS...6 FIGURE 2: KEY NMC COUNTERPARTS FIGURE 3: NMC STRATEGIC PLANNING CYCLE FIGURE 4: NEW ORGANIZATION STRUCTURE OF NMC FIGURE 5: NMC ADVOCACY CYCLE October

4 1 Executive Summary The National Strategy for Eliminating NTBs is addressing the critical issue of capacity of the national institutions, private sector and other stakeholders in Rwanda for effective elimination of NTBs. Based on evidence from various studies conducted in the last two years, it is clear that the cost of NTBs for EAC countries runs into tens of millions of dollars. Within this group, the landlocked countries such as Rwanda, Uganda and Burundi suffer the greatest loss from NTBs due to distance from the main ports of Mombasa and Dar es Salaam. A poor road infrastructure, delays at border crossings and lack of harmonized import and export standards and procedures are among the most mentioned NTBs in this context. As a result, the cost of imports of one container in Rwanda, for example, is more than 3.5 times higher than in Tanzania and 2.5 times higher than in Kenya. Although Rwanda is one of the countries with the highest improvement in creating business conducive environment according to the WB Doing Business Survey 2011, in terms of Trading Across Borders indicators it ranks only 159th. To address the problem of NTBs the EAC Protocol envisage creation of the National Monitoring Committees on NTBs (NMCs) as a national mechanism for monitoring and coordination of NTB elimination. However, the functioning of these committees has not been hugely successful in national or regional context and the list of main NTBs registered in the Time Bound Programme for Elimination of NTBs has not recorded much progress since Rwanda joined the EAC in The reasons for the lack of tangible results from the NMC's activities include the lack of authority, coordination structure and resources, lack of analytical capacity to address priority NTBs in a meaningful way, inadequate representation and contribution of the private sector to its operations, insufficient regional cooperation between the NMCs and lack of strategic planning approach to monitoring and elimination of NTBs. The goal of this Strategy is to reverse this situation by significantly strengthening the Rwanda NMC s operations, enabling it to become the driving force of the NTB elimination process at national and regional level. The Strategy is built around three strategic outcomes, each contributing to resolving significant capacity issues of the NMC, developing tools and improving procedures for more effective NTB's monitoring and elimination. Under first outcome, this Strategy will help the NMC to build the institutional and organizational capacity, institute strategic planning and monitoring function and increase visibility and communications. Among other things, the Strategy recommends that the NMC members divide in three Task Teams, each team covering one of the key areas of NTB: Standards, Transport and Infrastructure and Custom and Border Procedures. To complement these activities, the NMC communication strategy was developed which will improve its internal, external and advocacy related communication. The second outcome represents the main pillar of the NMC operations, its advocacy role for removal of NTBs. The strategy components under this outcome include improving registration and monitoring mechanism and information systems for NTBs, development of methods to prioritise NTBs and initiate research and developing and engaging advocacy October

5 channels for the removal of NTBs. To further strengthen the research component, the Strategy recommends that NMC conducts Regulatory Impact Analysis (RIA) on NTBs of all legislation proposed to the government. Finally, to assess progress in the elimination of NTBs, the NMC will initiate a development of the NTB Elimination Index. This index would allow measuring the NTB reduction in each EAC country and comparison and ranking of progress between the five countries according to their respective contributions to the removal of NTBs. Under third strategic outcome, the Strategy is proposing the ways for the NMC and the government to engage in bilateral and multilateral negotiations. These negotiations should lead to easing and removal of the priority NTBs. The Implementation Plan attached in Annex 1 provides detail list of activities and the funding requirements for implementation of the Strategy. October

6 RANKING National Strategy for Eliminating Non-Tariff Barriers 2 Introduction The establishment of East African Community (EAC) and Customs Union opens up the potential to increase in intra regional trade and integration. For example, Uganda's share in intra-regional trade went up from 13 per cent in 2005 to about 20 per cent in 2008, while Tanzania's exports to Kenya rose from $95.4 million in 2004 to $208.9m in 2007, an increase of 54.3 per cent. 1 But trade liberalization agreement that defines the operations of the EAC Customs Union is only the beginning of the story. Indeed, the EAC countries need to make progress on trade facilitation and reduction of remaining national and regional Non- Tariff Barriers (NTBs) to ensure that they benefit to the maximum possible extent from their multilateral trade liberalization. 2.1 NTBs and Rwanda performance in regional trade The NTBs are defined in the EAC as quantitative restrictions and specific limitations that act as obstacles to trade. Such restrictions and limitations are embedded in laws, regulations, practices and requirements other than tariffs and include non-tariff charges, government participation in trade, restrictive trade practices and policies, customs and administrative procedures and practices, Technical Barriers to Trade (TBT), Sanitary and Phyto-sanitary Measures (SPS); and un-harmonised working hours, among others. Although difficult to measure precisely, it is clear that the cost of the NTBs for the EAC countries runs into tens of millions of dollars. The landlocked countries such as Rwanda, Uganda and Burundi, are particularly affected and in terms of cost of export and import these countries rank among the most expensive in the world. In case of Rwanda, its continued success in the recent years has been exemplified by its performance in the World Bank s Doing Business Report where it is now ranked 58 th worldwide as the second best reformer Rwanda's rankings in WB Doing Business Reports DB 2008 DB 2009 DB 2010 DB 2011 Figure 1: Rwanda s rankings in WB Doing Business Reports 1 Official Websigte of the MINICOM, October

7 However, further improvement in ranking will primarily depend on a result of the economy s performance in trading across borders. The WB Doing Business Report 2011 is ranking Rwanda as 159th out of 183 countries covered by the Report. The same report indicates that it takes 35 days to export, requiring 8 documents and at an overall cost of US$ 3,275 per container. The cost for importing is even higher. Comparison of Rwanda to countries such as Singapore as the number one in the world in doing business performance and with its EAC partners is presented in Table 1. Trading across borders (rank) Documents to export (number) Time to export (days) Cost to export (US$ per container) Documents to import (number) Time to import (days) SINGAPORE* TANZANIA KENYA UGANDA RWANDA BURUNDI ,262 2,055 2,780 3,275 2, Cost to import (US$ per container) 439 1,475 2,190 2,940 4,990 4,285 *Leader country in WB Trading across borders Indicator Table 1: Comparative overview of ranking between Rwanda and regional economies in WB Doing Business Survey 2011 Reducing the time and cost losses to exporters and importers is thus paramount to Rwanda s increased regional integration and trade facilitation, but also to sustaining growth in the long run. A survey on NTBs that was conducted by PSF in 2008 reported that NTBs in EAC were numerous and sizeable. For example, bribes were elicited at 21% on top of the shipment costs of which 78% were paid at road blocks. There are also sizeable costs associated with procedures. The PSF survey suggests that time associated to procedures costs business an average of US 400$ a day due to storage costs and the loss potential of revenue for the frequent shipments. A recent study of the United Nations Economic Commission for Africa (UNECA) reveals that persistent NTBs exist in the EAC region despite the fact that the Customs Union has been operational for more than 5 years. The report further indicates that administrative requirements such as customs procedures, clearances and cargo inspections contribute, on average, to 75% of trade delays in developing countries. Other studies indicate that the average direct additional cost of NTBs per shipment sent by road from Mombasa to Kigali is around US$3,500. In addition, East African companies spend October

8 on average US$145,000 per month on employees time and accommodation costs due to NTBs and delays. The negative impact of this additional cost on competitiveness of producers and exporters as well as on consumer prices is exceptionally high. For example, in Rwanda the retail prices of most imported consumer goods are 30-50% higher than in Europe. According the study made by Nathan Associates in road transport costs are high due to a combination of lack of backhauls and poor road conditions and delays at the borders due to customs procedures and lack of risk management, road check points and numerous weighbridges., In the Northern Corridor, high informal payments are a significant component of total costs. However, reducing and eventually removing these NTBs is not an easy task. First of all, some restrictions are legitimate and include safety and security measures necessary for protection of consumers and industries. Some of the NTBs such as poor roads and railway infrastructure are structural in nature. Their elimination would require longer time and high level of investments. But many other NTBs are the result of a lack of technical and administrative capacity of the national and regional institutions or the overregulation and bureaucracy. Although usually less capital intensive their removal requires extensive technical assistance, strong institutional leadership and involvement of complex political mechanisms. The examples of such NTBs include non harmonized standards and procedures, complicated rules and documentation, multiple charges and delays at border crossing, double customs bond payments faced by importers, multiple weigh bridges or excessive police road blocks. It should not be overlooked that NTBs are quite different in nature, so any meaningful NTB elimination strategy must be based on a proper analysis of the causes of the problems, identification of the key national and regional stakeholders as well as the definition of methods and means for addressing them. 2.2 Rwanda National Monitoring Committee on NTBs As envisaged by EAC Protocol, the key mechanism for monitoring and coordination of NTB elimination are the National Monitoring Committees on NTBs (NMCs). The NMCs are established in all five EAC countries with members from the business community and the key government institutions. The NMC on NTBs in Rwanda has 19 institutional members, 8 from the key business community organizations and associations and 11 from the government institutions. The strategic framework for operations of the NMCs is defined by the Time Bound Programme for Removal of NTBs The process of reporting NTBs is established through the responsible national ministries and private sector focal points that forward the complaints from the private sector operators to the NMCs. The NMC meets on a quarterly basis to discuss the complaints, propose solutions and identify institutions that should take specific corrective actions. In case of the NTBs that are cross border in nature, the NMC is supposed to begin the bilateral 2 Corridor Diagnostic Study of the Northern and Central Corridors of East Africa, Nathan Associates, April 2011 October

9 discussions with counterpart NMCs from EAC Partner States. The NCs in Partner States should then initiate their respective national NTB elimination process. However, the functioning of this mechanism has not been highly effective for removal of NTBs, Over the last few years some progress has been made in these areas but not enough to produce a significant effect. The Time Bound Programme that lists NTBs in the region is not recording much progress, particularly on the key NTBs affecting landlocked countries such as key NTBs on along the corridors, harmonization of customs procedures and export/import documents, certification and standards, etc. There are several critical areas that Rwanda and other EAC countries need to attend to in order to be able to address the issue of NTB's removal more strategically: First, the NMC that coordinates the NTB's elimination process must strengthen its organization and increase political leverage so that it becomes recognized as a competent and relevant counterpart. Second, the national institution and its key counterparts must have appropriate technical capacity to analyse and address the characteristics of NTBs. Third, the functioning of the national and regional institutions in the regional mechanism for elimination of NTBs must be clearly defined. In this context, the relevant institutions and committees should be activated. Operations and results of the NMC operation must more transparent and involve a large number of national and regional stakeholders. In order to increase the capacity to address the priority NTBs and better influence the process of implementation of EAC Custom Union, Rwanda NMC designed a National Strategy for Eliminating NTBs presented in this document. October

10 3 Stakeholders analysis The stakeholders of NMC Rwanda are institutions located in Rwanda which are directly or indirectly affected by NTBs, which have influence or power over NTBs related processes or have an interest in success of their removal. 3.1 National Monitoring Committee on NTBs In order to facilitate the elimination of Non-Tariff-Barriers (NTBs) to trade, EAC Secretariat and member states of EAC, with support from Trademark East Africa (TMEA) are implementing a NTB reporting, monitoring and eliminating mechanism. The system is supported by NTBs structures (including task groups) whose main function is to process and facilitate resolution of reported barriers. NMC comprises government ministries and public institutions, private sector organizations, transports associations and some exporters and importers who are appointed to facilitate resolution of reported barriers. The key counterparts of NMC are MINICOM, MINEAC, PSF, NMCs in other EAC countries and EACBC. The relationship with these organizations is showed in Figure 2. Figure 2: Key NMC counterparts In the following section, we provide an overview of all NMC counterparts and their relevance for the NTB elimination process. 3.2 Private Sector The private sector is considered as the engine of development of countries. EAC is also considered as a private sector driven regional community. In order to drive the integration process and influence the decision making, private sector must take a lead. In order to October

11 increase trade flows, the private sector must have an active role in identifying, registering and advocating for the removal of all NTBs in EAC Private Sector Federation The Private Sector Federation (PSF) was founded in December 1999 by the merger of the Chamber of Commerce and Industry and the Employers Organization and positioned as an umbrella organization of the private sector associations (PSOs). Today, the PSF is the strongest association of the Rwandan business community. It provides a platform to its members to keep up with the latest public policy changes, obtain training and professional development opportunities and gain exposure for their product, services and brands. The tasks of PSF have become multifaceted and gained regional dimension following the Rwanda s membership in East African Community (EAC) in PSF plays a prominent role as the co-chair of the NMC and the voice of the Business community. It is expected that the PSF will in the future also contribute to the NMC budget especially in the field of research, position papers preparation and NMC visibility by hosting its website Private Sector Organisations Association of Rwanda Long Distance Truck Drivers (ACPLRWA) Members of ACPLRWA are the ones who are primarily affected by NTBs in their daily business while using the transport corridors and the two ports of Mombasa and Dar-Es- Salaam. The association will be useful in identifying, registering and updating the NTBs that Rwanda faces in EAC, COMESA and elsewhere. Association of Clearing Agents (ADR) Clearing agents association is a key member of the NMC. Clearing agents are intermediaries between customs authorities and transporters, importers and exporters. They also have access to the sea ports. They possess wide knowledge on customs policies and procedures not only in Rwanda but also in the region. They are and will still be supportive in identification of customs issues that can create cumbersome procedures leading to unnecessary delays at sea ports, borders or customs headquarters and which are considered as NTBs. MAGERWA MAGERWA is a warehouse where goods transit before they are released to their owners and transported to their final destination. MAGERWA plays an important role as far as international trade is concerned. The time that MAGERWA takes to release cargo is a factor that can impact positively or negatively on transport cost. MAGERWA will contribute a lot in advising on cargo time release. Rwanda Transporters Association (ATAR) ATAR is an association of truck owners. The high transport cost as a result of NTBs affects negatively their business and the overall cost of doing business in the country. The cost that is related to NTBs is evidenced by them and thus, they are key players as members of NMC by providing facts and figures on losses incurred resulting from NTBs. October

12 Association des Importateurs de Pétrole (ASSIMPER) ASSIMPER, the association of petrol importers, is and will continue to play the same role as the one on ATAR mentioned above. By providing evidences, they will contribute a lot in making the research and position papers a strong advocacy tool which will appear as unchallengeable. 3.3 Other public institutions Ministry of Trade and Industry (MINICOM) The Ministry of Trade and Industry is the main stakeholder by coordinating the process of identifying, registering, eliminating, monitoring and evaluation the removal of NTBs. Having in its mandate trade facilitation and trade promotion, the Ministry will provide a large part of the budget for a smooth functioning of the NMC. The Ministry takes the lead in all NMC activities. The NMC is hosted by MINICOM and its meeting chaired by the same ministry. Rwanda Bureau of Standards (RBS) The NTBs related to mutual recognition of standards are often a consequence of frequent practice of some EAC Bureaus of Standards to allow certification of substandard products. As a result, many products are tested in each EAC country separately creating a substantial negative impact on time and cost of trade. RBS is the adequate institution that can guide and advise the Rwanda NMC for NTBs related to standards. The NMC is also the proper channel that RBS will use to report those NTBs while protecting consumers interests. Ministry of Infrastructure (MININFRA) The NMC will refer to MININFRA for NTBs related to infrastructure. The NMC cannot achieve its advocacy role for infrastructure improvement without the support from MININFRA particularly in areas of transport policy and regulations at national and regional level. Ministry of East African Community Affairs (MINEAC) MINEAC is coordinating all issues related to EAC integration. The Ministry will provide guidance on the EAC protocol and laws which can help to eliminate NTBs. It will also recommend the adequate channels that should be used to address them. MINEAC has an interest to see all NTBs removed and thus trade flows increased as results of elimination of NTBs. Rwanda Development Board (RDB) RDB has in its mandate export and investment promotion. This is, however, limited by NTBs which have a non negligible impact on FDIs attraction. As a member of the NMC, RDB will provide expertise on how NTB's removal plays an important role in export and/or investment promotion. October

13 Ministry of Foreign Affairs and Cooperation (MINAFFET) One of the proposed methods in eliminating NTBs is bilateral discussions among EAC partner states. MINAFFET is expected to provide advise on diplomatic procedures and the most successful channels for advocating for NTB removal at the regional level. Rwanda National Police (RNP) Some of NTBs that have been identified are police road blocks and check points. RNP will help NMC to address this issue through the regional police network that exists between them. Rwanda Utility and Regulatory Agency (RURA) Together with MININFRA, RURA will provide technical expertise for NTBs related to public utilities, communication and transport. RURA will help the NMC to address the local NTBs related to its responsibilities. Rwanda Revenue Authorities (RRA) The Customs office deals with clearance of all goods meant for exports and imports. NTBs related to delays in customs and border procedures and goods clearance are of utmost importance. RRA is an institution that has formulated customs laws, regulations and procedures and is a key stakeholder of the NMC in proving guidance and helping to address such NTBs. Rwanda Environmental Management Authority (REMA) REMA is a public institution created with the objective to protect the environment. Protection of the environment can be an NTB if the regulation is not harmonised with the regional environment laws. REMA will help the NMC to address NTBs which are classified in that category. Ministry of Agriculture (MINAGRI) Like RADA, MINIGRI is a leading ministry in advising the NMC in agriculture policy at national and regional level. Evidenced facts will be provided by the Ministry for all NTBs related to agriculture products and discriminatory policies. National Agriculture Export Board (NAEB) The National Agriculture Export Board is established to support Rwanda agricultural exports. It was set up by bringing together three government agencies responsible for the entire Agriculture Export and cash crop base under one management. NAEB is important stakeholders for the NMC in research on agriculture specific NTBs and regional advocacy. October

14 4 NMC SWOT Analysis The following are the main current characteristics of the NMC presented in the SWOT framework. Strengths All key stakeholders are included as members Time bound programme for removal of NTBs as a key program document Good technical knowledge of members in their respective subjects Regular meetings and reporting established Weaknesses No National Plan for Removal of NTBs Lack of decision making powers and resources of NMC Lack of analytical capacity to address priority NTBs Private sector not sufficiently represented in NMC No clear division of work between the members of NMC No formal follow-up mechanism and monitoring instruments Insufficient strategic cooperation at the regional level Lack of visibility and information systems Opportunities NTBs high on the political agenda in Rwanda and regionally High private sector interest and pressure EAC Protocol provide the legal structure for NTB elimination (trade dispute resolution mechanism) Existing body of research on trade and removal of NTBs Threats No national legal framework for operation of the NMC and removal of NTBs Many important NTBs outside Rwanda and without direct influence of Rwandan government Removal of some NTBs is complex and require multidisciplinary approach Capacity of member organizations to implement improvements varies External assistance available for management of NMC and removal of priority NTBs October

15 5 Strategic framework 5.1 NMC Goal The goal of the NMC is: To establish effective NTBs monitoring and elimination mechanism at national and regional level 5.2 Strategic Outcomes This goal will be realized by achieving the following three strategic outcomes: 1. Established effective NMC organization and capacity for monitoring of NTBs 2. Increased capacity of NMC in advocacy for eliminating of NTBs at national and regional level 3. Improved mechanisms for elimination of cross-border NTBs 5.3 Strategic Outputs Strategic Outcome 1: Established effective NMC organization and capacity for monitoring of NTBs Strategic Output 1.1: Developed strategic planning and M&E system for NTB elimination Every year the NMC will develop rolling 3-year strategic plan and annual operations plan. To ensure implementation, these plans will have to emerge as a collective effort of the key stakeholders and as an expression of their interest and commitment. The plans will specify the expected roles of each organization in the implementation of activities and achievement of the strategic objectives. To measure and report on the progress, the M&E system will be developed with SMART indicators and corresponding data gathering mechanisms. The design and maintenance of the strategic plans will be one of the tasks of the NMC coordinator. National Strategy for Elimination of NTBs Monitoring and Evaluation Implementation of the NSE NTBs Annual Operations Plan for Elimination of NTBs Resource and funding plann Priority setting Figure 3: NMC Strategic Planning Cycle October

16 Strategic Output 1.2: New NMC organization designed and adopted The management of the NMCs has been recently raised to a higher level with the Director General of MINICOM Chairing and CEO of the PSF Co-Chairing the Committee. However, the current organisation of the NMCs should be redesigned to include more senior managers with decision making powers from participating organizations and dividing the members into working groups focused on different topics or aspects of NTBs elimination. Recent appointment of the full-time NMC Coordinator should increase operational capacity and accelerate the process of organizational change in NMC. The NMC membership will be increased to include more relevant public and private sector representation. The new members will be invited and will include the key exporters and importers, transporters and other companies with high involvement in intra-regional trade. Improved organization includes increasing the level of representation and management of the NMC, improving coordination between members and division of members to functional sub-committees or task-teams. Based on the Time-Bound Programme there will be at four Task Teams covering distinctive areas for NTB monitoring and elimination. The number of Task-Teams can be expanded to in line with other NTBs hindering implementation of the Common Market. The initial four Task-Teams include: Task Teams on Standards, Task Teams on Transport and Infrastructure, Task Teams on Customs and Border Posts procedures Each Task Team will design its plan of operations and nominate a Team Leader who will be responsible for its implementation. In implementation of their tasks the teams will be supported by the technical assistance provided by the development partners. The NMC Coordinator will also function as a National Focal Point (NFP) on NTBs and would liaise with the MINEAC for coordinating EAC integration matters. Management Chair: MINICOM Co-chair: PSF NMC Coordinator and Secretariat Task-team Leader Task- team Leader Task-team Leader Task-team on Standards NMC members Task-team on Transport & Infrastructure NMC members Figure 4: New organization structure of NMC Task-team on Border Posts Procedures and Customs NMC members October

17 In line with the new structure and tasks of the NMC, the NMC Coordinator will draft the templates of the key reports and analytical papers and propose and implement improved reporting mechanism. The NMC will meet in plenary sessions on quarterly basis. Once per month, the NMC Coordinator will convene the meeting of Team Leader to monitor implementation of the operation plans. Strategic Output 1.3: Developed NMC legal framework Strengthening of the NMC legal mandate should take place though legislating the NMC roles and responsibilities for identification, removal and monitoring of NTBs. By doing so NMC activities will carry more weight and its decisions will become mandatory. The proposal for NMC legal framework will be prepared by MINICOM. It could take a form of ministerial decree or similar. Strategic Output 1.4: Capacity building of NMC members and stakeholders designed and implemented The training will we be designed along the key priorities of the NP for removal of the NTBs. It is expected to include the topics such as methodology for preparation of Position Papers on NTBs, basic elements of Regulatory Impact Analysis (RIA), selected topics on priority NTBs such as transport barriers, standards and certification, NTB monitoring techniques and instruments, etc. Sessions will be delivered either along the regular NMC plenary meetings or during the sub-committees meetings on specific topics. The training material will be fully based on actual cases and on-going work of the NMC. It is planned to implement one key training session per quarter alongside the regular NMC meetings with possible additional working sessions with sub-committees in the period between the two NMC meetings. Strategic Output 1.5: Visibility plan developed and implemented Increasing visibility of the activities of all institutions involved in the process towards NTB elimination would provide additional strength to their activities. An NTB dedicated website at MINICOM would increase information sharing with all stakeholders. It would enable other possibilities such as joint research and development of position papers, public opinion and business community pooling, presentation and analysis of success stories and problem areas, and other interactive activities. The details of the visibility plan are presented in the NMC Communication Plan in Chapter 6. October

18 Strategic Outcome 2: Increased capacity of NMC for pro-active advocacy for eliminating of NTBs The NMC advocacy will be implemented in line with the standard advocacy cycle that includes: identification, analysis and prioritization, research, engagement through advocacy channels and monitoring and evaluation of advocacy results. (Figure 5) Registration/Status revisionof NTBs Monitoring progress and end Evaluation of results Internal NMC deliberation and prioritisation of NTBs Engagement through advocacy channels Research Preparation of Position Papers and RIA Figure 5: NMC Advocacy Cycle Strategic Output 2.1: Strengthening national and regional NTB information systems for identification and registration of NTBs The NMC should ensure that all registration of NBS is done in consistent way that enables quality monitoring, sharing information with other stakeholders and initiation of elimination activities. The registration of NBS is initiated by private sector through relevant government ministry or agency or directly to NMC. Registered NTBs need to visible to all stakeholders as well as the information on the progress on their elimination. A facility should be created for stakeholders to submit comments and suggestions. The experience of the WTO SPS and TBT Committees represent a relevant model for notification, reporting and discussion. 3 At the regional level the TMEA is supporting the EAC and partner states to adopt the COMESA-EAC-SADC online reporting monitoring and eliminating system based on TMCM 4 ( Trademark Southern Africa, TMEA s sister programme, is also supporting this initiative so there is a joined-up approach from Eastern to Southern Africa. 5 Additional training of government institutions, business sector organizations and civil society will be needed to improve skills and knowledge for the TMCM to be effectively utilized across EAC countries to use the system to report and monitor progress in removing 3 Kirk 4 SADC Trade Monitoring and Compliance Mechanism (TMCM) 5 An integrated strategy to eliminate non-tariff barriers, TMEA 2011 October

19 NTBs. The availability of information is expected to enable NMC in Rwanda as well as in other EAC countries to work with relevant organisations to develop and implement plans to eliminate the reported NTBs. In close collaboration with EAC Secretariat and other regional bodies the functioning of the regional mechanism relevant to NTBs elimination should be reviewed and improved. The central focus of these activities should be in relation to mandate and functioning of the EAC Secretariat, Industry and Investment Committee (TIIC), Trade Remedies Committee and EAC Council of Ministers as these bodies have the most important responsibilities for the regional aspects of NTBs elimination. Strategic Output 2.2: Prioritization of NTBs and Research The NMC will develop prioritization mechanism based on the Time-Bound Programme for elimination of NTBs and develop analytical capacity to clearly present the key characteristics of the selected priority NTBs and develop Action Plans for their removal. In order to move beyond the current very simplified problem analysis from the Time-Bound Programme, the NMC should be able to develop for each identified priority the NTB Position Paper that discusses institutional, technical, political and financial requirements for NTBs elimination. This important task should be implemented in close cooperation with the Private Sector Federation which as a member of NMC could provide advice and the position of the private sector. The work on Position Papers will led by the NMC Task-Teams with appropriate expertise and assisted by external consultants. The results of the analysis should be shared and discussed with NMCs in other member states and will become a detail agenda to the national NMCs for NTB monitoring and removal. For NTBs that affect in the similar way other EAC countries, Rwanda will team up with their respective NMCs for developing joint Position Papers. The Time-Bound Programme lists 17 unresolved NTBs directly affecting Rwanda. The Strategy prioritizes the NTBs that directly affect Rwanda s ranking in Trading Across Border section of the WB Doing Business Report. The WB ranking is based on three sub-indicators: All documents required by customs and other agencies to export and import Time to export and import (document preparation, customs clearance and technical control, port and terminal handling, inland transport and handling) Cost of export and import (based on US$ per 20-foot container) October

20 RWANDA'S PERFORMANCE IN DOING BUSINESS DB 2008 DB 2009 DB 2010 DB 2011 Rwanda Overall Ranking 150th 139th 70th 58th Starting a Business Dealing with construction permits Employing Workers Registering property Getting credit Protecting Investors Paying Taxes Trading Across Borders Enforcing Contracts Closing a Business Table 2: Rwanda s ranking in WB Doing Business reports Additional prioritisation criteria include a combination of estimated impact assessment,, status of current intervention and estimated difficulty to resolve. On this basis it is proposed that the NTB Position Papers are developed for the following NTBs (see annex for full description of the NTB): NTBs affecting number of import/export documents: Lack of implementation of EAC harmonized documents Lack of harmonized procedures manual NTBs affecting time to export and import goods Delays in transit bonds cancellation Numerous institutions involved in testing goods Existence of several weighbridges stations in the Central and Northern Corridors Customs working hours are not harmonized Several Police roadblocks along Northern and Central Corridors, estimated at 36 between Mombasa - Kigali and 30 between Dar-es-Salaam to Rusumo border. NTBs affecting cost of export and import Corruption along the Northern and Central Corridors (police roadblocks, weighbridges and border gates) Port charges are not harmonized (the Port charges should be benchmarked with international port charges) As a part of NMC work the criteria for prioritization will be further developed to include variables such as empirical evidence of the impact on NTBs on trade, sector or priority export goods specific variables and other variables that would be proposed by the NMC subgroups. October

21 The results of the research on NTBs will be summarised in NTB Position Papers. Each Position Paper include as a minimum: 1. Detail description of the NTB 2. Estimation of the cost for doing business (charges, time, lost business, etc) 3. At least two scenarios for resolution (involved institutions, existing regional/national mechanisms, ongoing activities on resolution, proposed steps and procedures, estimated cost of intervention) 4. Action Plan for resolution A model NTB Research Paper is provided in Annex 3. Strategic Output 2.3: Regulatory Impact Analysis (RIA) For any new regulation that could potentially affect regional trade the NMC should initiate development of Regulatory Impact Analysis (RIA). The RIA assesses the likely economic and social impact of a proposed regulation. Through the NTB information system, the proposed regulation with the regional impact should be available for other NMCs and other interested parties for comments and suggestions. The new proposed national regulation submitted to the GoR will be reviewed on continuous basis by the NMC on the basis of RIA conducted by the legal team of experts. This team will be established and managed by MINICOM and will consist of the legal experts from the institutions which are mostly concerned and involved in NTBs elimination mechanisms such as RRA, RBS, MINEAC, RTDA, PSF, and the transporters association. The first RIAs will be conducted on the following legislative acts and procedures currently in the pipeline: Harmonization of Customs Procedures Manual, Harmonization of domestic tax regimes with the EAC countries, Draft Law on Infrastructure Development Private Funding, In addition the NMC will establish ad hoc task groups to review and validate all new strategic plans and studies from the perspective of NTB elimination. The priority review will include: Rwanda Strategic Transport Master Plan, One stop border post aiming at reducing delays at borders, Axle load harmonization regulations in EAC and, Transport Development Strategy in EAC. Strategic Output 2.4: NMC establish and engage advocacy channels The Position Papers developed for each of the priority NTBs will include a detail action plan for engagement with relevant institutions responsible for NTB elimination and the specific advocacy agenda for NMC for increasing awareness and disseminating the research results. October

22 NMC advocacy channels include: EALA EAC Secretariat EABC NMCs in other EAC countries National and regional media Organizing conferences on NTB advocacy topics Detail on advocacy communication tools to be used in NMC advocacy activities are detailed in Section 5. Strategic Output 2.5: NTB M&E: Construction of NTB Elimination Indicator The NMC will work on developing an indicator, a sort of a NTB Elimination Indicator that would provide the possibility to estimate and present differentiated intensity of various types of non-tariff barriers or as additive index incorporate a whole spectrum of non-tariff barriers. The NTB Elimination Indicator would enable measuring progress in NTB reduction for each EAC country as well as comparison and ranking of the progress in five countries according to their relative contributions to the removal of NTBs. As part this effort the NMC will take an initiative and start collaboration with NMCs in partner counties and the EABC on reviving the Business Climate Index Survey (BCI) for East Africa initiated in The main aim of the BCI survey was to identify the nature and scope of NTBs experienced in the day-to-day business within the region. In 2004 BCI covered 500 companies and 150 government executives. The plan is to co-ordinate these efforts with the monitoring work which will be undertaken by the Transport Observatory along the Northern and Central Corridor. In addition, the design of the NTB Elimination Indicator will include the analysis of the source data from IFC Doing Business Report (DBR) on Trading Across Borders component. In this section of the DBR compiles procedural requirements for exporting and importing a standardized cargo of goods by ocean transport. The key factors influencing ranking include cumulative number of documents needed to export and import the goods across the border along with the time and cost necessary for completion. The NTB Elimination Indicator will use all available information to calculate the contribution of each EAC country to elimination of cross-border NTBs. In this way it would be possible to isolate the effects of each country on improvement of business climate in the EAC. The work on construction of the NTB Elimination Indicator will be undertaken by the NMC working group supported by the external technical assistance and in collaboration with NMCs from other EAC countries and EABC. October

23 Strategic Outcome 3: Improved mechanisms for active engagement on elimination of cross-border NTBs Strategic Output 3.1: Established bilateral dispute resolution mechanism The current practice of bilateral negotiations on removal of the priority NTBs will be further strengthened. The NMC will initiate negotiations between the relevant ministries, monitor their progress and report to the regional NMC coordination meetings and the EAC Secretariat. The NTB Position Papers would provide background information and identify the critical points for the negotiations. The bilateral dispute resolution mechanism will be led by MINICOM and supported by MINEAC. In preparation for the bilateral negotiations Rwanda NMC should initiate establishing strategic partnerships with NMCs in Uganda and Burundi as most of the corridors related NTBs need to be addressed by the authorities in Kenya and Tanzania. Some of the priority issues to be discussed through bilateral negotiations include: Harmonization of documents in line with the EAC guidelines Harmonization of customs procedures in line with the EAC Customs Procedures Manual Reduction of weighbridges stations in the Central and Northern Corridors in Kenya and Tanzania Strategic Output 3.2: Strengthened regional dispute settlement system for NTB removal EAC member states and the Secretariat should ensure that the dispute settlement system is in place and through Trade Remedies Committee and EAC Council of Ministers ready to address NTBs. It is recommended that the EAC consider adopting the SADC approach of linking the management of NTBs with a formal monitoring and compliance mechanism that allows for fast track decision making and is linked to the formal dispute settlement mechanism with a legally binding outcome. The experience of the EU in establishing a legally binding mechanism with sanctions for non-compliance provides a relevant model. 6 The TMEA is currently engaging experts to recommend the development of a legally binding EAC enforcement mechanism for elimination of NTBs. 6 Robert Kirk, Africa Trade Policy Notes, Note #7, World Bank, 2010 October

24 6 NMC Communication Strategy 6.1 Objectives and stakeholders For NMC to achieve its objectives as stated above, a strong and well designed communication plan must be put in place. A Plan that will inform NMC members and national and regional stakeholders of the significant achievements, changes and support the NMC advocacy role in eliminating NTBs. The following communication objectives flow from NMC s Strategic Outcome 1: Established effective NMC organization and capacity for monitoring of NTBs. These objectives will guide the selection of audience, message development and activities: Objectives: 1. To effectively communicate the work and achievements of the NMC to its members and stakeholders national and regionally; 2. To support the advocacy work of the NMC with effective and efficient communication tools. The following audiences have been identified as key for NMC. These are groups that require focus from the MINICOM and its NMC Coordinator in order to raise awareness and ensure their participation and partnership in NMC activities. PRIMARY Private companies and organisations (nonmembers of NMC) Government ministries and agencies (nonmembers of NMC) NMCs in EAC member countries EAC institutions Business associations in EAC Media SECONDARY General public INTERNAL AUDIENCE Private companies and organisations (Members of NMC) Government ministries and agencies (Members of NMC) MINICOM Table 3: NMC Communication Stakeholders 6.2 Communication Strategy Overview As outlined in the chart below, the Communication Strategy has four components or streams that will focus on achieving the Communication Objectives through specific goals and activities. October

25 ACTIVITIES MESSAGE AUDIENCE GOAL National Strategy for Eliminating Non-Tariff Barriers NMC Objective: Established effective NMC organization and capacity for monitoring of NTBs Communication Strategy External Communication Advocacy Communication Internal Communication Promote the image of NMC as an active and results oriented public-private forum focused on effective national and regional advocacy and elimination of NTBs. Private companies and organisations (Members of NMC) Promote and support discussion on priority NTBs and their effect on Rwanda s businesses in order to raise awareness and influence both national and regionally on policy-making processes, activities and decisions. Private companies and organisations (non-members of NMC) Keep NMC members knowledgeable and passionate about NMC activities by fostering an information and knowledge sharing culture. Private companies and organisations (Members of NMC) Government ministries and agencies (Members of NMC) General Public Media Government ministries and agencies (non-members of NMC) NMCs in EAC member countries EAC institutions Government ministries and agencies (Members of NMC) MINICOM Business associations in EAC Media NMC is pro-active forum capable of representing government and private sector interests in monitoring NTBs and engaging with key national and regional stakeholders in NTB elimination. Elimination of NTBs by fostering cooperation and applying consistent set of actions and instruments is possible. It is a key conditions for improvement of business environment and overall welfare in Rwanda NMC encourages innovative ideas and supports the work of its members by developing effective tools and processes for NTB monitoring and elimination Media Kit Style Guide Website enhancements Event planning Advocacy Communication Toolbox Website enhancements Case studies Publications News Brief campaigns Bulletin board - quizzes Media articles/advertorials Table 4: Outline of NMC Communication Strategy October

26 6.3 Communication Activities/Tools Developing and employing creative, effective and engaging communication tools specifically for each target audience will enable NMC to get the right message to the right stakeholder using the most relevant medium. There are many ways to relay messages, conduct consultations, and engage with stakeholders but a key focus should be on which channel is the most credible for the specific target audience. Knowing the communications environment is critical. Communication tools will differ among stakeholder groups. Usually a combination of tools is most effective, depending on available resources. The type and frequency of communication tools employed will vary depending on the stakeholder group targeted. More resources will be focused on stakeholder groups that are identified as primary with less frequency to those identified as secondary targets. To reach a diverse stakeholder base with varying messages, NMC will develop the following communication tools that they will employ over the next three years: NMC News Brief The NMC will develop monthly News Brief summarising achievements, work in progress and future plans and distribute through a number mediums including the website, alerts on SMS and an electronic version sent to members. The newsletters will be written using form and content that is easy to read and of interest to the target stakeholders. Case Studies For each successful NTB elimination case the NMC will develop a case study outlining the what, when, where, how and results of these successes. The case studies should be documented in case format and distributed to media houses, membership and other stakeholders as standalone publications and within newsletter on the website. Editorials These are articles on specific topics of interest to stakeholders to inform and educate. They may be written by key members within NMC, or by well established external experts on NTB advocacy issues. Keep in mind the audience when writing these articles. Frequently asked Questions (FAQs) Like Fact Sheets, the FAQs are an important tool composed by NMC for distribution to stakeholders in policy papers, newsletters, electronic platforms, and as handouts at events and meetings. FAQs will be kept regularly updated just as Fact Sheets are, and should be regularly reviewed to incorporate progress updates, emerging issues, and public feedback. Media Kit They purpose of a media kit is to ensure that your message is covered in the desired media. The media kit makes it easy for reporters to write the article by giving them all the information they need in one place. A typical media kit is used by an organisation to inform and educate media personnel about the NMC and any specific messages they want to convey. It also helps to guarantee that the NMC s message is reported on in the media by October