Malawi, Tanzania team up to enhance trade and curtail smuggling

The Malawi Revenue Authority(MRA) and the Tanzania Revenue Authority (TRA) have launched the Electronic Data Exchange System, which will see exchange of electronic data between Malawi and Tanzania for customs purposes.

The collaboration between the two revenue collectors aims at promoting trade facilitation, enhancing revenue collection, and securing movement of goods under imports, exports and transit regimes.

It replaces the manual exchange of data between MRA and TRA, which has been leading to long waiting time at the border and allowing movement of illegal imports from Malawi to Tanzania without detection.

Additionally, the manual exchange has been providing room for importers and exporters to under declare their goods with the aim of evading tax, and preventing the revenue institutions from having advance information for risk management purposes.

The new system, which will benefit Customs administrators, clearing agents, traders and other government agencies, will enhance clearing of goods and enable verification of quantities, valuation, origin and tariffs of goods exported and transiting between the two countries.

Speaking during the launch of the platform at Kasumulu Border in Tanzania, MRA Executive Director for Corporate Services Agnes Katsonga Phiri stressed on the need for mind-set change among officers for the systems to achieve the intended purpose.

“Having the system cannot be an achievement on its own if the human capital; the staff don’t change their mindset. Integrity remains a big issue because if wrong information is entered, we will have wrong data and we will not achieve what we have decided to do,” Katsonga Phiri said.

She said that they would embark on working on issues of integrity so that there is honesty because they want to make sure that when traders or agents come to their offices they should not be standing and waiting while officers are busy with their phones or computer games.

“Going forward, we need some surveillance cameras so that we are able to see what is happening because we don’t want to get complaints from those that transit through our border to say, okay you have the system but we don’t seem to be attended to by your staff,” Katsonga Phiri said.

She added; “We want complete mindset change for our staff to make sure that they are committed because we have made a commitment as MRA and TRA so that commitment must be a reality. We want traders to feel the benefits not just it to be a talk show and not really happening on the ground.”

Commenting on the Electronic Data Exchange System, Katsonga Phiri was optimistic that the coming in of the new system would help improve the two countries’ ratings on the World Bank assessment.

“I hope it will help improve the ratings as Malawi and Tanzania in terms of the assessment that is done by the World Bank because they assess on trading across the border like how long does it take to cross the border. With the electronic information of the data, it is going to help,” she said.

On his part, TRA Deputy Commissioner General Mcha Hassan said that apart from facilitating trade, the new system will help the two countries to curb smuggling of goods as it simplifies clearing procedures at the border.

Hassan said; “This is a historical event as it will facilitate trade between our nations because we do a lot of business between Malawi and Tanzania, so the event signifies the importance of trade facilitation and the cost of doing business for a trader.”

“One of the challenge of customs is smuggling, so we think by doing this system, we will reduce smuggling because we simplify the procedures and most of the traders will use the system instead of going through unofficial routes,” he said.

Technical teams started working on the system interface solution is July 2021. The UK Government has financed the system interface through Trade Mark Africa to the tune of US$200, 000.

Trade Mark Africa Programme manager responsible for Digital Trade Systems Alex Kipyegon said they intervened in line with their focus, which is ‘growing prosperity through trade.’

“We were approached by MRA, they indicated that they have this initiative that they wanted to start together with TRA but at the time they did not have the necessary funds to support the intervention. There have been some issues; they could not validate the accuracy of declarations so they needed this platform to provide them with sufficient information to establish if those declarations were accurate,” Kipyegon said.

“Trade facilitation agencies will now be able to anticipate what is coming and then be able to validate the information and also process that information quickly, that’s basically a reduction in processing time and also a reduction in terms of cost. Normally, it used to take people two, three or more hours but this system will cut all that down,” Kipyegon added.