Goods Kenyans Are Smuggling to Beat High Taxes
Goods Kenyans Are Smuggling to Beat High Taxes
Goods Kenyans Are Smuggling to Beat High Taxes
Kenyan traders are now using unusual strategies, such as smuggling items via the Ethiopian border, to maintain their businesses because of the unfavorable business climate in the nation. The majority of the products being smuggled past the border, according to a study by the international journal BNN, include fuel, alcohol, and cigarettes.
Border towns along the Kenya-Ethiopia border are growing as a result of the region’s burgeoning black market, which allows for the sale of smuggled goods at drastically discounted costs. The low-cost products are arriving in Nairobi, offering consumers more economical options yet robbing the government of much-needed funds.
While it has been noted that Kenya’s high taxes are a major component in the smuggling trade, the absence of robust commercial relations between the two nations has also been mentioned as a factor leading to the growth of the black market trade. It is important to note that while Ethiopia and Kenya do not have free trade agreements, Kenya does with the East African Communities (EAC).
Due to the absence of clear tariffs between Kenya and Ethiopia, it is difficult for traders to legitimately export goods to Kenya. The vast porous border has been the preferred option for traders due to the administrative challenges at official border crossing locations, making it easier to smuggle high-demand commodities into the Kenyan market. The Kenya Bureau of Standards (KEBS) has stepped up efforts to stop this illegal activity in response. Border smuggling continues to be a problem, as evidenced by the KEBS officials’ seizure of smuggled products from Eastleigh Market in August that were valued at millions of dollars.
An official from KEBS then said, “They (the goods) are coming through porous borders and we have increased surveillance as the products are harmful to people.” Petrol retailed for Ksh211 in September in Kenya, where prices have been rising gradually every month. Due to this, Kenyans are now compelled to look for less expensive options, including as smuggling and LPG automobile conversions.
