Tanzania’s Agricultural Export Sector Faces Significant Fee Hike for Phytosanitary Certificates
Arusha. Tanzania’s agricultural export sector is experiencing a dramatic policy shift following an unprecedented increase in fees for phytosanitary certificates, which are crucial for exporting agricultural goods.
The Tanzania Plant Health and Pesticides Authority (TPHPA) has implemented a staggering fee increase of over 460 percent, prompting concerns within the industry regarding the nation’s competitive edge in global markets.
Phytosanitary certificates serve as verification that agricultural exports have been inspected and comply with pest and disease regulations of the destination countries. Effective January 2025, the cost of obtaining these certificates will soar from Tsh 58,347 per container to Tsh 331,320. This new fee structure includes an inspection charge of Tsh 201,320 and a phytosanitary export certification fee of Tsh 130,000 for shipments exceeding 1,000 kilograms.
A concerned exporter commented, "The increase is unsustainable for many in our industry. It impacts pricing and our global competitiveness. We urge the government to reconsider or implement mitigating measures."
In defense of the fee increase, TPHPA director general Joseph Ndunguru emphasized the necessity of enhanced services. He noted that the previous fees, which were established in 1996, no longer adequately supported the Authority’s operations.
Prof. Ndunguru mentioned that TPHPA has upgraded its laboratory capabilities with the acquisition of five High-Performance Liquid Chromatography (HPLC) machines, allowing for the testing of up to 2,000 crop samples weekly. This advancement aims to reduce the necessity for exporters to send samples abroad, ensuring prompt issuance of accurate phytosanitary certificates and bolstering market access.
However, exporters, particularly small and medium-sized enterprises (SMEs), are expressing heightened distress over the fee increases. Some may hesitate to voice opposition due to fears of government repercussions. One horticultural exporter reported their costs skyrocketing from Tsh 1.4 million to Tsh 7.3 million for 29 shipments, drastically inflating export expenditures.
The ramifications of the fee hike extend beyond container shipments, affecting those processed at airports. Plant quarantine and phytosanitary services for non-container shipments have surged from Tsh 45,900 to Tsh 155,000 for consignments over 1,000 kilograms.
Exporters are raising alarms that these escalating costs could jeopardize Tanzania’s competitive market position. A leading exporter of cashew nuts to Europe and the UAE remarked, "Tanzania risks losing market share if this issue is not addressed."
The fee increase could adversely affect crucial export sectors, including horticulture ($569.3 million), tobacco ($517.1 million), cashew nuts ($422.8 million), oil seeds ($307.4 million), coffee ($295.5 million), and cereals ($273.4 million).
An investor commented, "This new fee structure contradicts the ongoing efforts to expand international markets for Tanzanian agricultural products and poses a threat to foreign currency earnings."
In comparison, regional fees underscore the disparity; a phytosanitary certificate in Rwanda costs 200 Rwandan Francs (TSh 364.1), in Uganda 5,000 Uganda Shillings (TSh 3,348), and in Kenya 600 Kenya Shillings (TSh 11,880), thereby offering exporters in neighboring regions a notable competitive advantage.
Concerns persist among exporters regarding the financial strain caused by these new fees, as they implore the government to reassess the policy to preserve the sector’s competitiveness.
