Hello William,
It's hard to believe it's
been 7 weeks since Taata Kiwanuka passed away...and it's been a difficult
recovery for the family.
But what really made a
difference are people like you...your involvement...the wonderful blogs...and
care...during those difficult moments. Things were so hectic I didn't even get
a chance to meet you and thank you in person...but I promise I will when I visit
again.
Have a good Easter
weekend.
Truly,
James Kiwanuka
James,
Unfortunately, all the works I did have been deleted! It is so sad! I
however wish you good life without your dear dad, but remain a united
family. God Bless you.
William Kituuka Kiwanuka
Below are three items which had been posted recently, some of which I have been doing for the good of all.
WHO CAN TELL US ABOUT THE
FATE OF THE ASSETS OF THE SHS12BN TRI-STAR TEXTILES?
Who bewitched Uganda? How come Uganda lost out on the AGOA
Opportunity and no body raised a finger?
It was big news when the recruitment of 200 was made. Ugandans thought that at last a big venture
with sound employment of youth had been made.
After the Tri – Star
company closed we learnt that Velupillai Kananathan the Managing Director, of
the firm that was exporting textiles under the African Growth Opportunity Act
(AGOA) did not bring in any cash to start the firm! Uganda Government helped the company get US
$5.2m from Uganda Development Bank to start the firm. And looks like all this
was lost!
William Kituuka Kiwanuka
WHO IS SUPPOSED TO CHANGE
THE LAW REGARDING THE OPERATIONS OF THE AUDITOR GENERAL’S OFFICE?
If the Parliament of
Uganda is committed to seeing a reduction on lost of tax payer money, why
doesn’t it change the law governing the Auditor General’s Office?
Those who are aware of the
functioning of auditors know that expenditures are made after the company
Auditors have checked and okayed the expenditure. Looks like in Uganda we want the avenue to
cheat the tax payer is what some people are interested in; otherwise, it is not
clear why the Auditor General’s office does not check transactions before they
are undertaken. Are some people
interested in this leakage continuing on as a way to cheat the tax payer? When this is done, the Public Accounts
Committee (PAC) could cease to exist.
William Kituuka Kiwanuka
TRADE
IN SERVICES UNDER THE EAST AFRICAN COMMUNITY COMMON MARKET
March
2011
Ministry
of East African Community Affairs (MEACA)
1.0 INTRODUCTION
1.1 What is a Service?
Services, though hard to
define, are present in every part of our lives.
Services contrast with the goods we buy, which are physical, tangible
items, such as a piece of fruit, a table, a car or the petrol to put inside
it. A service on the other hand, we also
pay for, and can include among other things:
i.
A haircut
ii.
A ride in a taxi
iii.
A night in a hotel
iv.
A class at school or University
v.
A loan from a bank
vi.
An operation in a hospital
vii.
Airtime minutes on a mobile phone; or
viii.
Representation by a lawyer in court.
All of the above are
purchased by a customer/user with money, or are provided by Government and paid
for through taxation. They contrast with
goods in that they do not leave the customer with an object in their hands
afterwards – they are intangible.
Services are often
intrinsically tied to goods. For example
the food we buy in the market consists of goods, but the transportation of the
food to the market is a service, and the retailer selling to us the good is
also providing a service. As a result,
services in our economy are of great value, constituting the same proportion of
total output or gross domestic product (GDP) as goods. Around half of Uganda’s GDP is from services,
compared to around a quarter from Agricultural goods, and a quarter from
Industrial goods.
1.2 How is trade in services
defined?
Trade in services refers
to a situation where the provider and consumer of the service are from
different countries. This trade is
different from trade in goods, mainly because the service provider usually
needs to be in the same place as the customer – for example both the
hairdresser and a woman having her hair cut must be in the same room, haircuts
do not pass across borders in the way that traded Maize or Televisions do. However, the hairdresser may be a Kenyan
working in Kampala, or the Ugandan woman having the haircut could have gone to
Nairobi to have it done. In such cases,
trade in services is taking place.
Since services are so
diverse, trade in services can be a difficult concept to define. Therefore, rather than define services or
trade in services, we can define the means/modes of provision of services. According to the World Trade Organization
(WTO), there are four modes for provision of services. These are as follows:
1.
Cross
– border supply:
This
mode of provision of services is most similar to trade in goods, in that the
service crosses over national boundaries.
This could include a Ugandan television station purchasing a Tanzanian
TV programme to play on the national channel; the programme constitutes a
service import for Uganda and an export for Tanzania. It could also include a Ugandan taking a
flight from Kampala to Mombasa on a Kenya Airways plane; the payment to the
airline is a service export.
2.
Consumption
abroad:
Under
this mode, nationals of one country travel to another country to receive the
service. This could be a tourist coming
to Uganda. Staying in hotels, visiting National Parks and taking transport
around the country – in this case the tourist is importing services from
Uganda. It could also include a Ugandan
student going to a University in Burundi, and thus importing educational
services from that country. It could
also include a Rwandan coming to Uganda to have an operation in hospital; in
such a case Uganda would be exporting health services to Rwanda.
3.
Commercial
presence:
This
mode involves the presence of the supplier within the importing country. This is where a service provider, a business,
moves to another country to set up and export its services. This could include a branch of Kenya
Commercial Bank (KCB) in Uganda, in which Kenya would be exporting financial
services to Uganda. It could include a
Ugandan construction firm going to Tanzania to build a road, in which case
Uganda would be exporting construction services to Tanzania.
4.
Presence
of natural persons:
This
mode involves the temporary presence of people who are themselves service
suppliers, or are employees of businesses that are service suppliers. This could include a Ugandan Information
Technology (IT) expert who travels to Rwanda to provide his services for a
client based there, in which case Uganda would be exporting IT services to
Rwanda. It should be noted that this
mode refers to temporary movement and not permanent immigration.
1.3 What is the classification of services?
Services can also be
classified into 12 key sectors, which are subsequently divided into further
sub- sectors. These sectors show the
variety of services that are provided.
The 12 sectors are:
1.
Business services
2.
Communication services
3.
Construction and Engineering Services
4.
Distribution services
5.
Educational services
6.
Environmental services
7.
Financial services
8.
Health – related services
9.
Tourism and travel related services
10.
Recreational, cultural and sporting services
11.
Transport services
12.
Other services not included elsewhere.
2.0 WHY IS
TRADE IN SERVICES PART OF THE EAC COMMON MARKET?
Services play an important
role in terms of production, investment, employment and trade within our
economies. This includes for EAC Partner
States of Uganda, Kenya, Tanzania, Rwanda and Burundi. In Uganda, services make up half of the
economy. Uganda currently spends
approximately shs 16 trillion on trade in services. Three service sectors make up over half of
the total; they are: wholesale and retail trade, real estate, and education.
EAC Partner States
recognize the importance of services to their respective economies and the
benefits to be gained from increased competition, efficiency, and economies of
scale from trade. They have therefore
undertaken to liberalize trade in services.
Greater trade in services could result in increased overall growth. A Common Market for trade in services allows
the EAC to develop into a single market by leading to harmonization of rules
and regulations and thus increasing the size of the market, making it more
attractive for domestic and foreign investors.
3.0 WHAT DOES THE EAC COMMON MARKET PROTOCOL
INCLUDE ABOUT TRADE IN SERVICES?
3.1 General
The EAC Common Market
Protocol lays down the rulebook for the economic integration of EAC Partner
States. Part F of the Protocol contains
the obligations with respect to trade in services. The Protocol guarantees that Partner States
will progressively remove all barriers to trade in services and shall not
introduce any new restrictions.
The Protocol provides for
a guarantee of National Treatment whereby each Partner State shall give service
providers from other Partner States the same treatment as service providers
from their own country. This effectively
will mean free competition for service providers across the EAC.
The Protocol commits
Partner States to guarantee the free movement of services supplied by nationals
of Partner States, and the free movement of service suppliers who are nationals
of the Partner States within the Community – this is a broad commitment to free
movement of all service suppliers in all sectors in all Partner States.
3.2 Domestic Regulation
The liberalization of a
service sector does not mean that the sector will not be regulated. The Protocol allows for regulation of service
sectors in accordance with national policy as long as they are consistent with
the Protocol and do not constitute barriers to trade in services. Regulation will therefore still apply to many
service sectors, for example, regulation of education services to ensure that
the quality of education is maintained.
3.3 Schedules relating to trade in services
Each EAC Partner State has
its own set of commitments with respect to trade in services, which are
contained within Annex V to the Protocol.
This means that not all sectors are to liberalize at the launch of the
Common Market in 2010, but that certain sectors are to be liberalized at
certain times up to 2015.
The initial round of
service liberalization has focused on some core service sectors. Each Partner State has agreed to liberalize
sub-sectors within seven initial sectors:
1. Business
services
2. Communication
services
3. Distribution
services
4. Educational
services
5. Financial
services
6. Tourism
and travel related services
7. Transport
services.
4.0 WHAT DOES THIS MEAN FOR SERVICE PROVIDERS
AND CONSUMERS IN UGANDA?
4.1 Increased opportunity and increased
efficiency through competition
For Ugandan service
providers, the main benefit of liberalization is that they can now compete in
the service sectors of other EAC Countries.
To take advantage of the liberalization of services and the Right of
Establishment, businesses will need to take some steps to ensure they are
eligible to supply services in other Partner States. These include:
1. To
establish a business in another Partner State firms must register their
business and obtain the relevant travel documents.
2. Explore
whether the Protocol provides opportunities for your particular business in the
target country. Refer to the protocol,
or visit the MEACA website (http://www.meaca.go.ug).
The
main concern of many service providers in Uganda is that there will be a flood
of competition from Partner States as the Common Market moves forward. However, for many businesses there will be
little change as in Uganda many sectors have been open for some time (for
example, telecommunications and banking).
In some other sectors businesses will have to prepare for increased
competition as firms from other Partner States enter the Ugandan market. In such cases, businesses should focus on increased efficiency while improving the
quality of the services thy offer, and therefore their competitiveness.
4.2 More options for Ugandan consumers
A Common Market for trade
in services will allow service providers from other Partner States to access
the Ugandan market. This will result in
more competition and better services for consumers. Consumers will have more options and
competition should help to bring down prices for services. Competition should also help improve customer
service and provide access to EAC best practice in service provision. This in turn will help develop Uganda’s
productivity and boost the economy.
5.0 SERVICE SECTORS LIBERALIZED BY EAC PARTNER
STATES
Tables exist of all the
service sectors liberalized by each Partner State and the date by which they
should be liberalized. Detailed
information can be accessed from the contact: meaca@meaca.go.ug
Uganda’s
Ministry of East African Community Affairs (MEACA)
2nd
& 9th Floor, Postel Building
Plot,
67/75 Yusuf Lule Road, Kampala
P.
O. Box 7343, Kampala
Tel : +256 414 340100
Fax : +256 414 548171
Email : meaca@meaca.go.ug
Website : http://www.meaca.go.ug
No comments:
Post a Comment