Kenyan Entrepreneurs in Tanzania Exempted from Suluhu’s Restrictions on Certain Foreign-Owned Businesses
President William Ruto of Kenya and President Samia Suluhu of Tanzania Shake Hands
The Kenyan business people doing business in Tanzania have been spared after it was announced that they would not be included in the current ban on certain businesses operations done by foreigners. The move follows the diplomatic talks between Kenya and Tanzania governments, which sought to cushion the cross-border trade as well as protect livelihoods.
On Friday, October 3, the State Department of the East African Community confirmed that Kenyan entrepreneurs were not going to be subject to the restrictions after bilateral negotiations had been successful. The conversation led to a realization that the ban would not apply to small and medium enterprises (SMEs) owned by the Kenyan in mobile money services, phone repairs, and electronic devices repairs.
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Originally announced by the Minister for Industry and Trade, Selemani Saidi Jafo, in July, the Tanzanian government ban had targeted 15 business sectors which were mainly run by foreigners. Activities that were banned included hair and beauty salons (with the exception of those that were situated in the hotels or serving tourists), cleaning of homes and offices, environmental sanitation, post and courier services, tour guiding, radio and television stations, museums and curio shops, brokerage and real estate services, and clearing and forwarding services.
The recent bilateral consultations have borne a good fruit. The United Republic of Tanzania has affirmed that no Kenyan business has been affected by the directive at all, and assured more that no Kenyan business will be restricted in the future either.
It further added that Kenyans who engage in the legitimate business ventures in Tanzania will be able to proceed with their operations without the fear of interference, business continuity and stability will be maintained.
The first prohibition as stated by Minister Jefo extended to other industries like agriculture (including farming and crop purchasing), gambling activities other than casinos, and micro and small industries. Penalties that foreigners who were in these industries without proper approval were either fined up to Tsh10 million (around Ksh502,927) or were sentenced to a maximum of six months in jail. Citizens of Tanzania who help foreigners to run those businesses might also be prosecuted, with a sentence of three months in jail and a fine of Tsh5 million (approximately Ksh251, 463).
Minister Jefo, however, made it clear that foreign business owners who already had valid licences to operate in the restricted sectors would be given a reprieve until their licences expired, which gave some comfort to the impacted entrepreneurs.
The Kenyan business community in Tanzania was first criticized by the announcement of the ban. It was said that the timing was not very good because it was going to lead to a lot of loss of revenue, loss of jobs as well as a derailment of commercial activities in the country. The limitation was also at a time when there was increased tension between Kenya and Tanzania, further deteriorating of the relations between the two neighboring countries.
Even though the exemption on Kenyan entrepreneurs has come with some initial worry, it is regarded as a big diplomatic victory, which means that thousands of businesses will remain in operation without the fear of being shut down or prosecuted. According to the analysts, this step does not only keep the economic activity alive, but also strengthens the significance of the cross-border cooperation within the East African region.
Your move of exclusion of Kenyan SMEs in the ban has not only given a sense of stability to the business environment in Tanzania to foreign investors and entrepreneurs but has also provided the same with respect to regulatory measures to protect the opportunities of the citizens of Tanzania. The ruling indicates continual attempts to reconcile the local economic interests to regional trade and investment commitments.
Kenyans who have legitimate lawful businesses in Tanzania can now operate without fears, as they will still be able to contribute to the economy of the country, and also enhance commercial relations between the two countries. The approach of dialogue and shared understanding by the government has therefore availed a way of tackling sensitive economic matters without compromising the trade relations.
This evolution not only emphasizes the importance of diplomatic involvement in solving business conflicts but also shows the beneficial results that can be achieved due to positive discussions among countries that can be neighbors in the East African Community
