This archive report was first published on 22 May 2020.
Published on May 22, 2020, the diplomatic tensions between Kenya and Tanzania have far-reaching implications for trade and revenue at the port of Mombasa.
The Kenya-Tanzania border has been closed, affecting the transportation of goods from the port to landlocked countries through the northern corridor.
Statistics from the Kenya Ports Authority (KPA) show that in the first seven months of 2019, 141,000 tonnes of cargo destined for northern Tanzania was imported through Mombasa port.
More than 8,000 metric tonnes of Tanzanian tea is sold through the world's second-biggest tea auction in Mombasa, with traders warning that the neighbouring country risks losing foreign earnings if the stand-off over Covid-19 containment measures escalates.
Coast region relies heavily on fresh produce imports from Tanzania, and traders in Coast's largest open air markets fear that the diplomatic tension could lead to a shortage and spike in prices of commodities.
Edward Mudibo, the managing director of East Africa Tea Trade Association, said that most of the tea produced in Tanzania is sold through the Mombasa auction, and that Tanzania will lose out in foreign exchange if the borders are closed.
He explained that Dar es Salaam cannot afford to stop trucks that bring tea to the auction and export through Mombasa port because it has no pricing mechanism for the produce.
According to the world's top exports report of 2019, tea was Tanzania's ninth largest foreign exchange earner after gold, tobacco, coffee, coconut, cashew nuts, fish, diamond, oil seed, and skin.
Trade analysts warn that the cost of transport for goods destined to northern parts of Tanzania is expected to go up due to disruptions caused by the diplomatic tension and Covid-19.
Omae Nyarandi, the chief executive officer of the Northern Corridor Transit and Transport Coordination Authority (NCTTCA), advised that the six NCTTCA member states and those that use the central corridor should harmonise their protocol to deal with Covid-19 to avert a rise in cost of transport and goods in the region.
The Kenya-Tanzania link road through Taveta launched three years ago reduces the voyage through Uganda by 358km.
Traders at the Coast are now fearing a shortage and spike in prices of commodities due to the diplomatic tension.
At the Kenya-Tanzania border in Taita-Taveta County, traders from both countries have started feeling the heat of the diplomatic stand-off.
Those affected complained that they have lost their economic livelihood and income following the closure of the border.
Kenya has not closed its borders with Tanzania or barred the movement of goods from any country, but the cross-border trade stand-off has sparked fears among traders at the Coast.
