By Mandere Onyinkwa
The Government of Kenya has voiced concerns over recent trade and business restrictions imposed by Tanzania.
In a statement signed by Investments, Trade and Industry Cabinet Secretary (CS) Lee Kinyanjui, Kenya warned that the measures could undermine regional integration and economic cooperation within the East African Community (EAC).
Specifically, Kinyanjui highlighted the impact of Tanzania’s newly enacted Finance Act 2025 and amendments to the Excise (Management and Tariff) Act 2019.
He noted that these legislative changes introduce new excise duties and an Industrial Development Levy of 10 and 15 percent, respectively, on goods transferred within the EAC.
“Kenya views these taxes as discriminatory and a threat to the progress made in regional trade,” the statement said.
Straining regional ties
Adding to the tension is Tanzania’s recently gazetted Business Licensing (Prohibition of Business Activities for Non-Citizens) Order, 2025.
The order prohibits non-Tanzanian citizens from engaging in 15 categories of services, including the ownership and operation of micro and small industries.
The directive takes immediate effect and carries significant penalties for violations, although current license holders are exempt.
Kenya’s Ministry emphasized that while it respects the sovereign right of EAC Partner States to legislate on domestic matters, such decisions must be made in consultation with other member states.
The ministry noted that unilateral actions like these contradict the spirit and legal framework of the EAC Common Market Protocol (CMP), which guarantees the right of nationals from member states to establish and operate businesses across borders without discrimination.
The EAC remains Kenya’s largest export market, accounting for 28.1 percent of the country’s total exports, estimated at Ksh. 297 billion in 2024.
Tanzania is Kenya’s second-largest trading partner within the bloc, with trade volumes reaching Ksh. 63 billion last year.
The new measures, Kenya warns, could jeopardize these gains and disrupt the flow of goods and services across the region.
Kenya has initiated consultations with Tanzania and other EAC Partner States to address the issue.
The government is also engaging the EAC Secretariat to ensure that the principles of regional integration are upheld and that member states adhere to their binding commitments under the CMP.