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Informal cross border trade (ICBT) in Tanzania

Informal cross border trade (ICBT) in Tanzania. Outline 1. Overview 2. Tanzania’s informal economy 3. ICBT in T anzania 4. General drivers of ICBT 5. Knowledge gaps 6. Way forward. Overview. ICBT acts as a source of employment, income and livelihood.

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Informal cross border trade (ICBT) in Tanzania

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  1. Informal cross border trade (ICBT) in Tanzania

  2. Outline1. Overview2. Tanzania’s informal economy3. ICBT in Tanzania4. General drivers of ICBT5. Knowledge gaps6. Way forward

  3. Overview • ICBT acts as a source of employment, income and livelihood. • Women in SSA constitute between 60% to 70% (UN Women, 2009) • The contribution of ICBT warrants attention from policy makers and practitioners • Recent data on ICBT in Tanzania is limited

  4. Informal economy in Tanzania • ICBT forms part of the informal economy. • The informal economy grew faster during the structural adjustment period. • Today, one third of Tanzania’s working population is engaged in informal activities (ILFS, 2014). • 50% of informal employment is in the trade & repairs sub-sector -employs 13% of women in the informal sector

  5. ICBT in Tanzania • ICBT presumably date back to the pre-colonial period, before the establishment of state boundaries • There is hardly any documentation of ICBT in recent years • Tanzania’s informal cross border exports were largely agricultural food commodities, fish, and forest resources (Ackello-Ogutu and Echessah, 1998)

  6. Tanzania’s Informal Food Trade with the Neighbors (US$ millions)

  7. General drivers of ICBT • Restrictive trade and economic policies such as import tariffs, quotas, export taxes, export bans (Ackello-Ogutu and Echessah, 1998) • cost of doing business that is associated with meeting regulatory requirements and custom procedures

  8. General drivers of ICBT (cont.) • Long distances to domestic markets • Limited access to finance • Limited market information

  9. Knowledge gaps • Lack of recent data on ICBT in Tanzania • Data requirement: • Who is actively engaged in ICBT and what is their nature of participation? • What type and volume of goods are informally traded across Tanzanian borders? • What are the major destinations of goods traded informally across Tanzania’s borders? and • What currently drives ICBT in the country?

  10. Way forward • collecting routine data at selected border posts in Tanzania • Identifying the methodology for data collection • Identification of particular skill sets required for data collection and analysis

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