The Impact of One-Stop Border Posts on Trade in Central Africa

Introduction

One-stop border posts (OSBP) have emerged as a crucial innovation to facilitate trade in Central Africa. Despite its vast natural resources and economic potential, the region has long been hindered by logistical and administrative challenges (Alexandre Larouche-Maltais, 2022). Indeed, the primary purpose of a one-stop trade post is to provide a framework for trade facilitation and logistics efficiency (AACE, 2013). In line with Regulation No. 05/22-CEMAC-UEAC-CM-38, CEMAC member states are obligated to establish so-called “juxtaposed” customs offices at all border control posts. These OSBPs aim to simplify customs procedures by integrating various clearance steps into a single point of contact. Their effective implementation will undoubtedly have a positive impact on trade in Central Africa, manifested in the following dimensions: reducing delays (1), lowering costs related to administrative procedures (2), improving transparency (3), and strengthening regional cooperation (4).

  1. Reduction of Delays

One of the key advantages of one-stop border posts is the reduction of processing time at borders. In the absence of an OSBP, freight carriers often have to navigate between multiple offices and fill out identical documents for each relevant customs service. This process not only slows the movement of goods but also increases the risk of corruption (WCO, 2018). With OSBPs, administrative formalities are centralized and digitized, allowing for faster and more efficient management of goods. For example, Kenya and Tanzania have introduced a new control system, a one-stop border post, where goods and people are checked unilaterally by customs teams from both countries, enabling much quicker border crossings (Esayas Abebe & Ariane Stohr, 2023). This has reduced clearance times from several days to just a few hours. “In the past, people had to wait hours, or even days, at the border because they had to go through the same process in Tanzania after completing checks in Kenya,” explains Dishon Njuguna, a customs officer at the Kenya-Tanzania border.

The introduction of an OSBP in Central Africa would group several border control agencies into a single entity. This would notably reduce transit times for traders or carriers, allowing for better management of available resources and assets at lower costs, while improving product competitiveness throug0h reduced processing times, which, according to the WTO, will result in lower costs associated with administrative procedures (Tonderayi Mukeredzi, 2018). Finally, this would intensify economic relations between countries.

  1. Reduction of Costs Related to Administrative Procedures

The establishment of a one-stop border post would address trade obstacles such as administrative delays and costs related to bureaucratic procedures. The persistence of these trade barriers partly explains the low rate of intra-African trade, which ranges between 11% and 15% of African commercial exchanges, according to UNCTAD statistics. Intra-regional trade in Central Africa accounts for only 2% of exchanges ( Mengue, 2017). This very low figure can be attributed to the aforementioned factors. The costs associated with customs formalities limit the growth of trade in this region, with community transit being the most affected by this trade weakness between countries in this area.

Implementing a one-stop border post would allow carriers from other states to pay transit fees at a single point. The situation is even more critical in this geographic region, which includes a few landlocked countries that rely on neighboring states to import or export their goods. Moreover, to simplify the procedure and reduce costs, the introduction of a digital one-stop border post could also have a positive impact. In this regard, UNCTAD noted in a study that the establishment of a digital one-stop post allowed Rwandan carriers to save over 6 million dollars. However, this form of one-stop post is still underused, but its adoption by Central African states could be beneficial.

    Improving Transparency and Fighting Corruption

As noted earlier, the establishment of a one-stop border post in Central Africa would allow economic operators to avoid indirect costs that create bottlenecks in their commercial operations (WTO, 2019). Additionally, it could have another positive impact on trade, particularly concerning transparency and corruption. Transparency is a crucial element for facilitating trade at borders. It constitutes “the starting point for ensuring the efficiency and, ultimately, the stability of a rules-based environment for goods crossing borders” (WCO, 2017). Transparency involves an instructional dimension, as it aims to inform economic operators about the conditions and constraints related to import, export, and even transit operations. For instance, it allows operators to be aware of the laws and regulations of the country where they plan to conduct a commercial operation. The goal is to both hold the operator accountable and help them prepare in advance. This principle is often a key feature in the implementation of one-stop posts.

In Cameroon, for example, the implementation of the One-Stop Shop for Foreign Trade Operations (GUCE) follows this logic. It aims to centralize most of the administrative procedures involved in trade operations (WCO, 2010). It provides economic operators with prior information on customs regulations and helps optimize their treasury management through the Payment Simulator (SimPa). In addition to fostering transparency in trade operations, one-stop posts also help reduce the risk of corruption in commercial transactions by significantly minimizing human contact.

Corruption is often considered a significant obstacle to trade, as corrupt practices can exempt economic operators from paying taxes and duties required by customs regulations, negatively affecting the efficiency of a commercial space (World Bank, 2023). The establishment of a one-stop post would help reduce corruption in commercial activities. The One-Stop Shop for Foreign Trade Operations has implemented a mechanism to limit contact between public officials and economic operators in the payment of various fees and taxes through its payment simulator, which also protects operators from potentially corrupt public officials by allowing them to make payments directly online.

  1. Strengthening Regional Cooperation

Establishing a robust legal and institutional framework is crucial to improving cooperation between OSBPs in Cameroon and its neighbors. Cameroon should develop bilateral or multilateral agreements that allow for the extraterritorial application of specific national laws, enabling joint controls at the OSBPs. For example, coordinating governance by implementing a holistic approach where various border agencies (customs, immigration, health) collaborate effectively to streamline processes and reduce bureaucratic hurdles.

Capacity Building and Training: Training personnel from different border agencies on the OSBP concept and its operational procedures is vital. Regular training sessions can help staff understand their roles within the OSBP framework and improve inter-agency cooperation. Furthermore, exchanges between border officials from different countries can foster better understanding and cooperation.

Recommendations

Infrastructural Development: Improv road access by ensuring that the road infrastructure leading to the Ekok-Mfum border post, the Kousseri-Ngueli border post, and other planned OSBPs is well-maintained and capable of handling increased traffic volumes. This will facilitate the transport of goods and reduce congestion at border posts.

Harmonizing Regulations: Ensure that the legal frameworks governing OSBPs are aligned with those in neighboring countries to facilitate operations and reduce bureaucratic barriers.

Leveraging ICT Solutions: Streamline processes and automate documentation and data-sharing systems between agencies to significantly reduce processing times and improve accuracy.

Joint Inspection Procedures: Customs and other relevant agencies should conduct simultaneous inspections to reduce delays and improve OSBP performance. This can be facilitated by a shared digital platform that allows real-time data exchange.

Feedback Mechanisms: Establish channels for traders and travelers to provide feedback based on their experiences at OSBPs to improve service quality.

Conclusion

In conclusion, the introduction of one-stop border posts in Central Africa will positively impact trade. By reducing delays, costs, and corruption, while strengthening regional cooperation, they are a cornerstone for the region’s economic development. OSBPs allow for much quicker border crossings, which would intensify economic relations between countries. However, their success will depend on the continued commitment of governments, regional partners, and citizens to promote the necessary reforms and investments to maximize their potential.

List of References

http://swguide.org/guichet_unique/AACE_guide_pratique_Guichets_Uniques_2013.pdf

                                                                                             AUTHORS

     Haiwang Djamo Ferdinang                              Tchoupe Fossi                                 Henri Kouam

            Research Analyst                           Volunteer Research Analyst        Founder & Executive Director

 

To Cite : Djamo, H. F., Fossi, T. & Kouam, H. (2024). The Impact of One-Stop Border Posts on Trade in Central Africa. Cameroon Economic Policy Institute (CEPI), Henri Kouam Foundation.

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