U N I T E D N AT I O N S C O N F E R E N C E O N T R A D E A N D D E V E L O P M E N T

Cross-border Trade
in the Pre- and
Post-Pandemic
Environment
Evidence from
Malawi, the United
Republic of Tanzania
and Zambia
 U N I T E D N AT I O N S C O N F E R E N C E O N T R A D E A N D D E V E L O P M E N T

Cross-border Trade
in the Pre- and
Post-Pandemic
Environment
Evidence from
Malawi, the United
Republic of Tanzania
and Zambia

Geneva, 2022
© 2022, United Nations

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UNCTAD/DITC/2021/3

eISBN: 978-92-1-001336-9
ABBREVIATIONS iii

ABBREVIATIONS

CBTA Cross-border trade association

COMESA Common Market for Eastern and Southern Africa

EAC Eastern and Southern African Community

MSMEs Micro-, small and medium-sized enterprises

PACRA Patent and Company Registration Agency (Zambia)

SADC Southern African Development Community

SDG Sustainable Development Goal

STR Simplified Trade Regime

UNCTAD United Nations Conference on Trade and Development

UNECA United Nations Economic Commission for Africa

iv CROSS-BORDER TRADE IN THE PRE- AND POST-PANDEMIC ENVIRONMENT

TABLE OF CONTENTS

ABBREVIATIONS............................................................................................................................................................................................ III

TABLE OF CONTENTS................................................................................................................................................................................. IV

1. INTRODUCTION........................................................................................................................................................................................1

2. OVERVIEW AND BACKGROUND: UNCTAD TRAINING ACTIVITIES....................................................................................2

2.1 METHODOLOGY OF THE IMPACT ASSESSMENT............................................................................. 3

3. RESULTS OF THE IMPACT ASSESSMENT ....................................................................................................................................4

3.1 IMPACT OF THE TRAINING PROGRAMME ON PARTICIPANTS’ FAMILIARITY WITH
TRADE RULES, CUSTOMS PROCEDURES AND TRADER RIGHTS AND OBLIGATIONS................... 4
3.2 IMPACT OF THE TRAINING PROGRAMME ON THE ENHANCED USE
OF OFFICIAL BORDER POSTS.......................................................................................................... 6
3.3 IMPACT OF THE TRAINING PROGRAMME ON INSTILLING CONFIDENCE
IN CONDUCTING A BUSINESS USING OFFICIAL BORDER CROSSINGS ........................................ 7
3.4 IMPACT OF THE TRAINING PROGRAMME ON ADAPTING THE BUSINESS MODEL........................ 7
3.5 IMPACT OF THE TRAINING PROGRAMME ON BUSINESS REGISTRATION...................................... 8
3.6 IMPACT OF COVID-19 ON CROSS-BORDER TRADE........................................................................ 8
3.7 IMPACT OF THE TRAINING PROGRAMME ON THE UNDERSTANDING OF COVID-19 MEASURES....... 9
3.8 IMPACT OF THE TRAINING PROGRAMME ON DEVISING NEW STRATEGIES.................................. 9
3.9 PROMINENT ACTORS AT THE REGIONAL AND NATIONAL LEVELS
AND UNCTAD’S COMPARATIVE ADVANTAGE................................................................................. 10
3.10 SUPPORT NEEDED BY SMALL-SCALE AND INFORMAL CROSS-BORDER TRADERS
FROM UNCTAD, CROSS-BORDER TRADE ASSOCIATIONS AND THE GOVERNMENT.................. 10

4. CASE STUDIES.......................................................................................................................................................................................13
4.1 MAGGIE KAMCHACHA, MALAWI.................................................................................................... 13
4.2 GLADYS NGWENYAMA, ZAMBIA ................................................................................................... 15
4.3 MARY MWEEMBA, ZAMBIA............................................................................................................. 16
4.4 REHEMA HANDICRAFTS, UNITED REPUBLIC OF TANZANIA.......................................................... 17
4.5 CHRISTINE KING’OLA, KENYA........................................................................................................ 20

REFERENCES................................................................................................................................................................................................23
TABLE OF CONTENTS v

LIST OF FIGURES

FIGURE 1: KNOWLEDGE AMONG INTERVIEWEES OF TRADE RULES AND CUSTOMS PROCEDURES,

AND TRADER RIGHTS AND OBLIGATIONS (PER CENT)............................................................................................... 5

FIGURE 2: ENHANCED KNOWLEDGE AMONG INTERVIEWEES ABOUT CROSSING THE BORDER................................................... 6

FIGURE 3: EXTENT OF INTERVIEWEES’ UNDERSTANDING OF COVID-19 RULES (PER CENT)....................................................... 9

LIST OF TABLES

TABLE 1: SAMPLE DISTRIBUTION OF THE INTERVIEWS ACROSS THE THREE COUNTRIES......................................................... 3

TABLE 2: REGIONAL SIMPLIFIED TRADE REGIMES IN PLACE.................................................................................................... 4

INTRODUCTION 1

1. INTRODUCTION

This report was prepared by UNCTAD’s Trade, Gender is based on the findings of interviews conducted with
and Development Programme. It provides an overview former training participants, and an online survey of
of the results of an impact assessment of capacity- government officials and representatives of cross-
building activities conducted by the United Nations border trade associations (CBTAs) who were involved
Conference on Trade and Development (UNCTAD) in the planning and delivery of UNCTAD training
in Malawi, the United Republic of Tanzania and programme. To complement the analysis and findings
Zambia aimed at small-scale and informal cross- of the impact assessment, the report also relies on
border traders, mainly women. Interventions were previous analytical work carried out by UNCTAD since
carried out as part of two projects: the Development the inception of the activities in 2016. By analysing
Account project “Informal Cross-border Trade for the the information collected from different categories of
Empowerment of Women, Economic Development, stakeholders, the report presents an original picture
and Regional Integration in Southern and Eastern of informal and small-scale cross-border trade in the
Africa”, implemented during 2016-2019, and the pre-and post-pandemic environment.
Development Account project “Global Initiative towards
The next section provides an overview of UNCTAD’s
post-Covid-19 Micro, Small and Medium Enterprises
capacity-building activities on cross-border trade
sector”, implemented during 2020-2021.
carried out during 2016–2021. Section 3 then presents
The assessment refers specifically to the capacity- the results of the impact assessment. Section 4
building activities carried out in November-December presents four case studies illustrating the impact of
2019 and February 2021 at selected border posts. It training activities on women cross-border traders.
2 CROSS-BORDER TRADE IN THE PRE- AND POST-PANDEMIC ENVIRONMENT

2. OVERVIEW AND BACKGROUND:

UNCTAD TRAINING ACTIVITIES

During 2016–2019, the UNCTAD Trade, Gender and • Build or strengthen traders’ entrepreneurship skills
Development Programme, Division on International in areas such as detecting business opportunities,
Trade and Commodities implemented the project setting goals for their businesses, improving the
entitled “Informal Cross-border Trade for the efficiency and quality of their activities, etc.
Empowerment of Women, Economic Development,
• Introduce traders to the process and benefits of
and Regional Integration in Southern and Eastern
formalizing their businesses.
Africa.” The project was comprised of a range of
activities, including training workshops, research, UNCTAD developed three country-specific guides
policy dialogues, surveys, interviews, and focus group tailored to Malawi, the United Republic of Tanzania and
discussions with stakeholders.1 Since this assessment Zambia to provide detailed and practical information to
relates only to capacity-building, the report will focus traders about the requirements to cross the border.3 The
on those activities. guides were the basis for the first component of training
activities. The EMPRETEC manual for low-literacy
Between 11 November and 2 December 2019, five
entrepreneurs was used for the second component.
training workshops for small-scale and informal cross-
border traders, especially women, were conducted at In response to the pandemic and its devastating
three border posts: Mwami/Mchinji (Zambia-Malawi), impact on micro-, small- and medium-sized enterprises
Nakonde/Tunduma (the United Republic of Tanzania (MSMEs), a broad United Nations inter-agency project
and Zambia) and Songwe/Kasumulu (Malawi and was launched in 2020 under the title “Global Initiative
United Republic of Tanzania). A total of 151 trainees towards post-Covid-19 Micro, Small and Medium
participated in the activities. Enterprises sector.” The project’s objectives were
to strengthen the resilience of MSMEs, mitigate the
Each training workshop lasted six days and was
economic and social impact of the global COVID-19
divided into two components. The first dealt with
crisis, and strengthen the contribution of MSMEs to
trade rules, customs procedures and traders’ rights
implementation of the United Nations Sustainable
and obligations; the second focused on developing/
Development Goals (SDGs).
strengthening entrepreneurship skills based on the
EMPRETEC methodology developed by UNCTAD.2 The UNCTAD Trade, Gender and Development
Programme was responsible for the trade and gender
The main objectives of the UNCTAD training programme
component of the project. Its interventions replicated
were to:
the training activities for informal and small-scale cross-
• Familiarize traders with trade rules and customs border traders carried out in 2019. More specifically,
procedures applied at the borders, and with their four training workshops were held from 1 to 15 February
rights and obligations when crossing the borders 2021 at the Mwami/Mchinji, Nakonde/Tunduma

1
Under the analytical component, a study was published in February 2019 examining the characteristics of cross-border trade
and the impact of cross-border trade activities on poverty alleviation, food security and women’s empowerment in Zambia,
Malawi, and the United Republic of Tanzania (UNCTAD 2019). The policy dialogue component included the publication of
an advocacy document presenting policy recommendations to facilitate cross-border trade and make it more beneficial for
traders, especially women traders, and for their communities and countries. The recommendations were mainly addressed
to policymakers in the three countries. The policy dialogue component also featured a one-day workshop held in Dar es
Salaam in December 2019 with policymakers and representatives of CBTAs and other relevant groups to validate the policy
recommendations proposed by UNCTAD and report on training activities. The project started in mid-2016 and ended in
December 2019.
2
EMPRETEC is an UNCTAD programme to promote the creation of sustainable, innovative and internationally competitive small-
and medium-sized enterprises.
3
The guides covered the following issues: trade rules, simplified trade regimes, rules of origin, documentation requirements, and
taxes and other charges. English and Swahili versions of the Traders’ Guides developed for the United Republic of Tanzania
and Kenya are available from UNCTAD at https://msme-w.unctad.org/cluster/enabling-entrepreneurship-policies-and-skills-
facilitation (accessed 21 November 2021).
OVERVIEW AND BACKGROUND: UNCTAD TRAINING ACTIVITIES 3

and Songwe/Kasumulu border posts. The training and small-scale cross-border traders, mainly women,
workshops included two components, one devoted as well as representatives of CBTAs.
to trade rules and customs procedures and another to
A quantitative sample of 25 Zambian and Malawian
entrepreneurship development. New training features
participants and 35 Tanzanian participants was selected
were introduced to respond to the project’s overall
randomly from among the pool of trainees. With support
objective to strengthen the resilience of MSMEs and
from the trainers who had facilitated the workshops,
mitigate the impact of the health crisis on them. These
UNCTAD conducted interviews telephonically with
features focused specifically on COVID-19-related
those 60 participants across the three countries
border requirements as well as possible strategies
between June and July 2021 (table 1). The qualitative
to make businesses more resilient to the COVID-19
results of those interviews were collected and analysed
crisis and better able to recover from it.4 A total of 131
and are presented in the following sections of the report.
traders participated in the four training workshops.
Table 1: Sample distribution of the interviews across
2.1 METHODOLOGY OF THE IMPACT the three countries
ASSESSMENT
Year of
United
capacity- Total
The impact assessment of the project’s capacity- Republic of Zambia Malawi
building interviews
building activities was based on a two-pronged Tanzania
activity
approach using both interviews and a survey. The
findings were supplemented by information readily 2019 8 13 9 30
available at the borders and by the results of previous
analytical work conducted by UNCTAD. 2021 9 12 9 30

The first part of the assessment strategy relied on a Total

17 25 18 60
series of interviews targeting informal and small-scale participants
cross-border traders who participated in the training Source: Prepared by the authors.
workshops organized by UNCTAD between 2019 and
The second part of the assessment entailed
2021 in Zambia, Malawi and the United Republic of
conducting an online survey of government officials
Tanzania. Interviews were designed to gain a more
and representatives of CBTAs who had been involved in
in-depth understanding of the impact of the capacity-
the design and implementation of the training sessions
building activities on the objectives of the training
held in 2019 and 2021. Out of 53 officials and CBTA
programme. In total, nine workshops were held between
representatives contacted by UNCTAD, 25 agreed to
2019 and 2021 with 282 attendees, including informal
participate in the survey.5

4
The overall activities of the UNCTAD Trade, Gender and Development Programme, which joined the project in September 2020,
include (i) an assessment of previous capacity-building activities on cross-border trade; (ii) development of new training material
for informal and small-scale cross-border traders, especially women, tailored to selected countries and translated in local
languages; and (iii) delivery of four training sessions in the United Republic of Tanzania and Kenya. The overall project will end in
March 2022.
5
Respondents included a sample of representatives from governments and associations including the Zambia Revenue Authority,
Tanzania Revenue Authority, Malawi Revenue Authority, Zambia Ministry of Trade and Commerce, Zambia Department of
Immigration, Tanzania Tunduma Town Council, Tanzania Kyela District Council, Zambia Permanent Mission in Geneva, the
United Republic of Tanzania Permanent Mission in Geneva, Zambia Compulsory Standards Agency, Zambia Police, Malawi
Informal Cross-Border Traders Association, Zambia Informal Cross-Border Traders Association, and the COMESA Informal
Cross-Border Traders Association.
4 CROSS-BORDER TRADE IN THE PRE- AND POST-PANDEMIC ENVIRONMENT

3. RESULTS OF THE IMPACT ASSESSMENT

The results of the assessment are based on the who, as a result, use informal routes to conduct their
following components involving the impact of the businesses.
training programme on participants:
Table 2: Regional simplified trade regimes in place
• Familiarity with trade rules, customs procedures
and trader’ rights and obligations Country Trade regime in place
• Enhanced use of official border posts
COMESA STR, SADC Trade
• Confidence in conducting businesses using Malawi
Protocol
official border crossings
• Ability to adapt the business model United Republic of
EAC STR, SADC Trade Protocol
Tanzania
• Willingness to register the business
• Awareness of COVID-19 measures COMESA STR, SADC Trade
Zambia
• Ability to devise new trade strategies Protocol
The assessment also covered the following issues: Source: Prepared by the authors.

• Impact of COVID-19 on cross-border trade Note: COMESA: Common Market for Eastern and Southern Africa;
EAC: Eastern and Southern African Community; SADC: Southern
• Prominent actors at the regional and national African Development Community; STR: Simplified trade regime.
levels and UNCTAD’s comparative advantage
One of the objectives of the training activities, therefore,
• Support required by small-scale and informal
was to equip informal and small-scale cross-border
cross-border traders from UNCTAD, CBTAs and
traders, particularly women, with knowledge and
the government.
understanding of these trade rules and customs
procedures and their rights and obligations as traders.
3.1 IMPACT OF THE TRAINING The assessment results revealed that following their
PROGRAMME ON PARTICIPANTS’ training experience, most participants were familiar
FAMILIARITY WITH TRADE RULES, to varying degrees with the main features of all three
CUSTOMS PROCEDURES AND trade rule processes and were aware of their rights
TRADER RIGHTS AND OBLIGATIONS and obligations at the border.
The quantitative results from the interviews with past
UNCTAD research has highlighted that most of the trainees illustrate that 85 per cent of respondents were
informal and small-scale cross-border traders in the extremely familiar with their rights, while 15 per cent
three countries studied, particularly women traders, were very much familiar with their rights. Furthermore,
are often unable to identify the rules that apply to relating to whether they had a better understanding
trade across borders.6 Specifically, this involves their of their obligations, 85 per cent stated that they were
knowledge of the trade rules of the (i) Common Market extremely familiar with their obligations, while 10 per
for Eastern and Southern Africa (COMESA) and its cent indicated that they were very much familiar and 5
simplified trade regime (STR); (ii) Eastern and Southern per cent indicated that they were adequately familiar.
African Community (EAC) and its STR; and (iii) Southern
Finally, on the question about their knowledge about
African Development Community (SADC) and its related
using the main trade instruments of the three trading
Trade Protocol (table 2). Navigating the different trade
blocs – i.e. the SADC Trade Protocol and the STRs of
regimes that apply under the three regional groupings
COMESA and EAC – 25 per cent indicated that they
is proving challenging for many cross-border traders
were extremely familiar with the main features of these

6
Borderline: Women in informal cross-border trade in Malawi, the United Republic of Tanzania and Zambia available at https://
unctad.org/system/files/official-document/ditc2018d3_en.pdf
RESULTS OF THE IMPACT ASSESSMENT 5

trade instruments, 18 per cent indicated that they they were adequately familiar. Figure 1 summarizes
were very much familiar, and 57 per cent said that the findings from the interviews.

Figure 1: Knowledge among interviewees of trade rules and customs procedures, and trader rights and obligations
(per cent)

85% 85%

57%

25%
15% 18%
10%
5%

Adequately familiar Very familiar Extremely familiar

The rights of cross-border traders

The obligations of cross-border traders
Knowledge on the use of COMESA and EAC STRs
and the SADC Trade Protocol

Source: b Prepared y the authors.

Note: COMESA: Common Market for Eastern and Southern Africa;
EAC: Eastern and Southern African Community; SADC: Southern
“I have been robbed several
African Development Community; STR: Simplified trade regime. times by porters while going
The qualitative data from the interviews reveal additional through unofficial routes, beaten
insights. Responses indicated that the new awareness by police, paid bribes, and even
about trade rules and traders’ rights and obligations
suffered abuse by improper body
has helped traders become more effective cross-
border traders. Notably, they acquired knowledge inspection. But now my motivation
about the Common List of Products under COMESA to use official posts is very high
and the EAC STRs, enabling them to benefit from following the positive outcomes
these instruments put in place to facilitate small-scale
resulting from knowing my duties
cross-border trade.
and rights as a trader and putting
Another useful piece of information mentioned by
participants was that they had become aware that, them into practice. I now trade in
while crossing the borders, they had to separate their a secure environment.”
personal belongings from their business goods. This
– Informal cross-border trader, United
would allow them to benefit from the “personal tax
Republic of Tanzania
rebate,” with no duties imposed on their personal
goods. Finally, some anecdotal evidence from
interviewees provides further insights on the impact Further insights from Tanzanian respondents revealed
of the training activities. that training participants had become familiar with
duties and taxes due at the border. This knowledge
contributed to their decision to trade using the formal
6 CROSS-BORDER TRADE IN THE PRE- AND POST-PANDEMIC ENVIRONMENT

border posts. In addition, they had realized that traders engage in informal trade because they are
paying whatever fee had been established according unaware of their rights and obligations and of trade
to the rules was less than what they would spend rules and procedures, including existing schemes
paying bribes, a common feature of crossing borders such as STRs designed to facilitate their businesses.
informally. Overall, the quantitative and qualitative
results from the interviews indicate that the training
programme had the desired impact. 3.2 IMPACT OF THE TRAINING
PROGRAMME ON THE ENHANCED
The results from the interviews with traders were USE OF OFFICIAL BORDER POSTS
analysed together with interviews from the online
survey of government border officials and CBTA
The second purpose of the interviews was to assess
representatives. In the online survey, 40 per cent
how the knowledge that participants acquired during
of respondents found UNCTAD training activities
the training activities helped them use official border
extremely useful, and 60 per cent found it very useful.
posts to conduct their businesses. The results reveal
All of the online survey participants stated that the
that 56 per cent of respondents found the new
UNCTAD training programme had proved beneficial
knowledge extremely helpful when crossing the border,
to the traders by strengthening their knowledge of the
36 per cent indicated it was very helpful, and 8 per
rules applied at the border. These results align with
cent indicated that it was adequately helpful (figure 2).
UNCTAD’s analytical findings that many cross-border

Figure 2: Enhanced knowledge among interviewees about crossing the border

8%

Enhanced knowledge
extremely helpful
Enhanced knowledge 36%
very helpful 56%
Enhanced knowledge
adequately helpful

Source: Prepared by the authors. Because of their enhanced knowledge and

Further qualitative data from the interviews illustrated understanding of border rules and procedures, some
trainees’ enhanced familiarity with requirements at the traders indicated that they were no longer afraid to
border. Some respondents indicated that they made deal with border officials. Such responses coincide
sure to carry all necessary documents when heading with the results of the survey of government officials
to the border. This resulted in a much easier and and CBTA representatives showing that, as a result
faster process to cross. Some trainees reported that of the training programme, cross-border traders were
they rely on the services of Trade Information Desk more knowledgeable and better informed about border
Officers to fill out documents such as the STR forms. rules and procedures.
Overall, trainees’ enhanced knowledge of border rules Indeed, 96 per cent of the online survey respondents
and procedures helped them spend less time clearing had observed behavioural changes in the traders who
their products and increased their willingness to trade participated in UNCTAD training programme, while 4
formally, with beneficial implications for their personal per cent could not identify any change. Some of the
security and the security of their merchandise. observed positive changes were increased knowledge
of border procedures and more willingness to use
RESULTS OF THE IMPACT ASSESSMENT 7

official border posts and make truthful declarations as making incorrect declarations on the value or origin
of the merchandise to be taken across the border. of the goods, or how to circumvent the rules through
bribes. The training programme encouraged informal
Some customs officials at the Tanzanian borders noted
traders to become more confident using the official
that the number of women carrying small consignments
border posts. Indeed, many respondents highlighted
through official border posts had been increasing
that doing business according to the rules proved to
steadily. In addition, CBTA representatives from Malawi
be simpler and less expensive than circumventing
reported that some traders were now insisting on
the rules.
getting receipts once they had paid taxes on their
products. Other customs officials from the United
Republic of Tanzania and Zambia noted reduced 3.4 IMPACT OF THE TRAINING
instances of smuggling in certain border areas due to PROGRAMME ON ADAPTING THE
the increased use of formal routes. Moreover, some BUSINESS MODEL
officials from the Zambian Standards Agency reported
increased compliance with STR requirements.
Interviews also aimed to evaluate whether trainees
Overall, the survey results indicate a shift in the mindset had adapted their business models due to their
of some traders toward trading formally. However, participation in UNCTAD training sessions: 96 per
officials also noted that only a minority of traders had cent of respondents stated that they had adapted
the opportunity to participate in capacity-building their business model, while 4 per cent indicated they
activities, and perhaps the traders who did so were had not.
those already prone to switch to more rule-complying
Results from the qualitative data indicate that many
behaviours.
respondents used a simple activity tool for business
planning that had been shared with them during the
3.3 IMPACT OF THE TRAINING training activities. This activity tool entailed traders to
PROGRAMME ON INSTILLING set goals, single out the activities needed to accomplish
CONFIDENCE IN CONDUCTING A them, and set a time frame for their completion.
BUSINESS USING OFFICIAL BORDER Moreover, traders had to identify people who needed
to be involved and record costs. Most respondents
CROSSINGS
indicated that the training programme helped them
improve their businesses and enhanced their financial
An additional objective of the interviews was to evaluate
management skills.
the confidence levels of informal traders in using official
border posts after they had participated in UNCTAD For example, a trader from Malawi running a small milk
training programme. Of the 60 participants surveyed, 92 business reported that she had become rigorous in
per cent indicated that they were extremely confident keeping records of all her business costs (e.g. buying,
to conduct their businesses through official border collection, processing and distribution). However, when
posts, while 8 per cent indicated that they felt very the COVID-19 pandemic hit, her business suffered,
confident to do so. and so did her revenues. She then put into practice
the knowledge acquired during the UNCTAD training
Qualitative data from trainees’ interviews revealed that
programme. After reviewing all her expenses, she found
some traders had started putting into practice the new
that milk procurement and collection costs represented
knowledge acquired through the training programme.
the largest share of overall costs, while distribution
Some traders reported positive results in terms of
represented the second highest. A clear idea of the
increased profits, a larger clientele, and the ability to
cost of each activity enabled her to restructure her
offer a more diversified range of products. Findings
business and save it.
from the interviews further indicate a positive correlation
between increased knowledge about border rules and Interviewees from Zambia indicated that bookkeeping
procedures, and growth in confidence in using official helped them run their businesses by monitoring costs
border posts. Before the training programme, many and benefits. To implement this, they started using a
traders had insights about how to trade informally – for receipt book and issuing receipts to customers for all
example, how to bypass the border posts altogether, transactions. Still, a few respondents indicated that they
how to use borders improperly through such methods had not yet decided whether to adopt a new business
8 CROSS-BORDER TRADE IN THE PRE- AND POST-PANDEMIC ENVIRONMENT

model. Overall, however, the qualitative interviews was confirmed by local district council officers in the
show that the training programme had a positive United Republic of Tanzania and Zambia.
impact on the way traders run their businesses. These
Further information from the qualitative data highlights
results coincide with the online survey findings: 88 per
several reasons for traders not going ahead with
cent of government and CBTA respondents indicated
businesses registration. Some respondents indicated
that the training sessions were a very effective tool
that the small size of their businesses could not
in this field, while 12 per cent stated that they were
accommodate the financial burden of registration.
somewhat effective.
This is couched in the perception that once a business
becomes formal and starts growing, it attracts heavy
3.5 IMPACT OF THE TRAINING taxation, despite being in its infancy. Hence, keeping
PROGRAMME ON BUSINESS the business informal is a way to escape pressure
REGISTRATION from tax authorities. Other respondents said that they
had no time available to go through the registration
process, or that they needed to build up their business
Trading informally affects the ability of traders to access
capital before going formal.
the benefits of formal business. It is estimated that
a substantial share (30 to 40 per cent) of Africa’s
regional trade is informal and that four times as many 3.6 IMPACT OF COVID-19 ON CROSS-
cross-border traders are likely to be operating outside BORDER TRADE
the formal economy than within it (UNCTAD 2019).
As a result, an additional objective of the interviews
The qualitative results from the assessment indicate that
was to assess whether the trainees had considered
most cross-border trade businesses were negatively
registering their businesses and, if not, to learn the
affected by COVID-19. Many reasons were mentioned,
reasons for not doing so. The quantitative results from
including lockdowns, social distancing measures,
the interviews revealed that 80 per cent of respondents
supply chain disruptions, a shrinking number of clients,
were considering registering their businesses, while
and increased business operation and travel costs due
20 per cent were not planning to do so.
to the need to comply with the new measures (e.g.
proof of a negative PCR test when crossing the border).
In Zambia, total lockdown entailed border closures,
“I never compromise on having my
with only commercial trade for essential commodities
valid border pass, having receipts allowed, which excluded most small-scale businesses.
for the goods I am trading and As a result, prices for goods and services escalated
filling out proper customs forms. To and, in some instances, doubled. Products such as
Irish potatoes, rice, fish, kapenta and groceries were
my surprise, by being transparent, among the most affected. Respondents indicated that
I realized that on some goods I the number of clients declined from the pre-COVID-19
pay very small amounts compared average of 50 customers per day to 10 per day due
to clients’ inability to afford soaring prices. Moreover,
to what I used to pay when I was
many traders, and especially women traders, reported
concealing the merchandise and economic losses due to goods that had gone unsold
paying bribes to some officials.” and, in many cases, gone to waste because they were
perishable. Some traders highlighted that people who
– Informal cross-border trader, Malawi
could afford it were stockpiling agricultural and food
items. All these shortcomings resulted in a sharp
reduction of incomes for traders and their households.
Some respondents did register their businesses. For
This in turn led to, among other things, the need to
example, some trainees from Zambia registered their
reduce the number of meals eaten per day from three
businesses under the “small business” category and, as
to two and, in the worst cases, to one.
a result, were able to open an account at a local bank.
Some informal cross-border traders said they registered While some traders kept their businesses going, though
their businesses with the local district council, which at a level far below the pre-pandemic period and
RESULTS OF THE IMPACT ASSESSMENT 9

suffering from a cash crunch, others indicated that they 3.7 IMPACT OF THE TRAINING
had to close their businesses partially or completely. PROGRAMME ON THE
For example, in Zambia, five respondents said they UNDERSTANDING OF COVID-19
had partially shut down their businesses because of MEASURES
low cash flow, border closures and declining clientele.
Three respondents indicated that they had completely As indicated in the previous section, the COVID-19
shut down their businesses. Among the worst affected pandemic and the resulting social distancing measures,
respondents were those who traded in kitchenware border closures, and border requirements strongly
appliances, blankets and other beddings. impacted small-scale cross-border trade. UNECA
Moving to the results of the survey administered to (2020) reports that over 42 countries in Africa introduced
border officials and CBTA representatives, 80 per cent either complete or partial lockdowns in 2020.
of respondents confirmed that cross-border traders UNCTAD, therefore, expanded the training programme
had been negatively impacted by the pandemic to delivered in 2021 by adding a new component with
a significant or very significant extent, while 16 per a twofold purpose: to share information related to
cent found a moderate negative effect, and 4 per cent the new border measures, and to support traders in
indicated only a minor negative effect. making their businesses resilient to the crisis. Against
The findings are in line with research by UNCTAD this backdrop, the interviews evaluated the extent
and other institutions confirming that the pandemic to which UNCTAD interventions had been effective.
negatively affected cross-border trade businesses. The results, shown in figure 3, revealed that 32 per
In addition, the findings point to severe shortages cent of respondents had acquired an extremely good
of essential goods in border areas deriving from the understanding of COVID-19 related rules, 33 per cent
combined effects of border closures and stockpiling, showed a very good understanding, and 7 per cent an
with consequent risks of food insecurity and increased adequate understanding. For some participants the
poverty (TradeMark East Africa 2021; Southern African question was not applicable because they had been
Trust 2021; Zarrilli and Linoci 2020; Zarrilli 2021). trained in 2019, prior to the pandemic.

Figure 3: Extent of interviewees’ understanding of COVID-19 rules (per cent)

Not applicable
32% 28%
Adequate understanding
Very good understanding 7%
Extremely good understanding
33%

Source: Prepared by the authors.

3.8 IMPACT OF THE TRAINING
Qualitative data indicated that the training sessions PROGRAMME ON DEVISING NEW
helped trainees not only adhere to the new measures STRATEGIES
but to be proactive. For example, some respondents
said that they encouraged their customers to wear
Qualitative data reveal that the training programme
masks and wash their hands, and, in some cases,
helped traders devise innovative strategies to respond
provided masks if customers did not have them. Others
to the new business environment. The interview
said that they kept a bucket of water and soap at the
results show that some traders turned to digital tools
entrance of their premises. Overall, the qualitative
to continue their businesses, including Facebook,
responses indicate that the training programme had
Instagram, WhatsApp groups, and online platforms.
enhanced cross-border traders’ understanding of
They used these tools both to establish networks to
COVID-19 rules and measures.
10 CROSS-BORDER TRADE IN THE PRE- AND POST-PANDEMIC ENVIRONMENT

advertise their products, and to buy and sell products with small-scale traders. At the regional level, they
online, including by making payments online. Some cited COMESA, SADC, the International Organization
of the main goods sold on the virtual platforms are for Migration, Southern African Trust, Open Society
ladies’ and men’s shoes, ladies make-up kits, and Initiative for Southern Africa, National Initiative for Civic
men’s trousers and shirts. These findings confirm those Education, and the EAC Secretariat that worked in
emerging from UNCTAD research: digital solutions can partnership with several countries. At the national level,
support the survival and even the growth of cross- actors included trade ministries, revenue authorities,
border trade, and can prove particularly beneficial chambers of commerce and CBTAs. Some respondents
to women traders. Keeping businesses running is a noted that trade associations had been highly effective
pressing issue considering the economic instability and influential in organizing and coordinating traders’
and widespread unemployment resulting from the participation in the training programme. In this regard,
COVID-19 pandemic (Zarrilli and Lopez 2020). the Tanzania Women Chamber of Commerce was
mentioned as a good example, though it was also
Other interview respondents indicated that they were
noted that increased funds would make the chamber
forced to explore new business opportunities once
more effective.
cross-border trade was no longer viable in order to
provide enough income for them and their families. Most survey respondents indicated their belief that
One alternative some of them pursued was farming. UNCTAD has a comparative advantage. Specific
By minimizing operational costs, using proper examples of the noteworthy value of UNCTAD’s
bookkeeping, planning, and providing customer interventions included the broad spectrum of issues
care, some respondents indicated that they had addressed in the training sessions, ranging from
managed to diversify to other businesses. Some entrepreneurship strategies to trade issues to new
said they had turned to selling locally produced goods COVID-19-related developments. In addition, they
instead of relying on imports. For example, they were noted that UNCTAD activities were based on solid
selling masks, sanitizers and aprons, which were in knowledge of cross-border trade-related issues
high demand and could be sourced locally. Other and, in particular, an in-depth understanding of the
respondents reported that they had established specific difficulties faced by women traders. Moreover,
home delivery services, while others had opened UNCTAD’s training activities involved even very small
makeshift structures to sell their products, especially traders who usually are not targeted by capacity-
food items for which demand was still high. Sourcing building activities.
locally provides a lifeline to many cross-border trade
businesses, but it deprives traders of the benefits of
buying products abroad at the best quality and price, 3.10 SUPPORT NEEDED BY SMALL-SCALE
including taking advantage of the favourable exchange AND INFORMAL CROSS-BORDER
rate (Zarrilli and Linoci 2020; Zarrilli 2021). However, TRADERS FROM UNCTAD, CROSS-
the interviews indicated that the training programme BORDER TRADE ASSOCIATIONS AND
equipped traders with new skills to manage their THE GOVERNMENT
businesses, allowing them to continue earning at least
some income despite the pandemic. A final component of the assessment sought to
determine the types of further support that cross-border
traders would need from UNCTAD, their respective
3.9 PROMINENT ACTORS AT THE governments and CBTAs:
REGIONAL AND NATIONAL LEVELS
AND UNCTAD’S COMPARATIVE UNCTAD
ADVANTAGE
• Most of the survey and interview participants
Finally, the survey of government officials and indicated that it would be helpful if UNCTAD
representatives from CBTAs assessed UNCTAD’s could provide regular training activities on trade-
comparative advantage in the region compared to related issues (e.g. capacity-building on border
that of other prominent actors. Most respondents procedures) for small-scale traders. This could
indicated that many organizations at the national and be conducted twice a year in collaboration with
regional levels were involved in different activities government border officials. Other respondents
RESULTS OF THE IMPACT ASSESSMENT 11

suggested organizing regional workshops • One respondent suggested that UNCTAD share
targeting MSMEs to share country experiences the Traders’ Guide with the CBTAs in digital
and challenges and provide training sessions format to facilitate its dissemination. This would
on trade-related issues. Yet others indicated make the guide a reference point and a source
that UNCTAD training programme should of information for traders. Respondents further
be replicated and/or offered at other border suggested developing a website for small-scale
crossings, mainly where STRs are in force, as is traders to provide information on trade and
the case for Mwanza and surrounding districts other issues.
in the United Republic of Tanzania.
• Respondents suggested that any further
• In addition to regular training activities on trade- training activity should either be conducted by
related issues, respondents indicated the need a national who can speak the local language or
for capacity-building activities focusing on engage the services of an interpreter to ensure
financial literacy and business management. that all trainees can follow the presentations
and participate in the practical exercises.
• Respondents indicated that UNCTAD could
provide training activities to help micro and • It was suggested that UNCTAD and other
small businesses overcome the challenges United Nations agencies, such as the
deriving from the pandemic by providing ideas international Trade Centre and the United
and sharing experiences on how traders, Nations Development Programme, establish
especially women, could continue conducting joint programmes to assist women traders in
their businesses under the new conditions. setting up MSME groups.
• Respondents suggested that UNCTAD could • Some respondents indicated the need to hold
collaborate with CBTAs and further strengthen training sessions to enhance traders’ capacity
their capacity to work effectively in their to improve the appeal of their products and
respective countries, including by providing comply with export market requirements.
funding to run their offices. Indeed, CBTAs
• Some respondents indicated that UNCTAD
highlighted that lack of funds impair their ability
could assist in establishing consultative
to maintain their offices and provide quality
mechanisms involving all stakeholders, private
services to members. As a result, membership
actors and government authorities. Such
has been declining. In addition, UNCTAD could
mechanisms would facilitate the development
assist countries where CBTAs have not yet
of policies that support and promote small-
been set up. For example, there is no CBTA
scale cross-border trade, including addressing
in the United Republic of Tanzania, and the
the non-tariff measures affecting exported
Tanzania Trade Development Authority (TAN-
products.
Trade) collaborates with trade desks in local
governments to deal with cross-border issues.7
Government
Lack of an organization fully devoted to cross-
border trade issues implies that traders do not The survey highlighted that cross-border traders expect
have a place to meet and get information and, more interventions from the government. Enhanced
even more importantly, they do not have an access to markets and finance, digitization, and support
institution representing them and presenting to improve productivity were mentioned as priority
their concerns. Finally, UNCTAD could provide areas. Additional measures needed to revive cross-
support (including finance) to CBTAs to establish border trade include:
trade information desks at the borders to inform
• Enhancing access to credit and establishing
traders about the trade regimes in force under
women’s empowerment funds (e.g. by setting
the different regional groupings (SADC, EAC
up COVID-19 funds to help revitalize cross-
and COMESA).
border trade businesses).

7
While there is no formal CBTA in the United Republic of Tanzania, there is the Tanzania Women Chamber of Commerce, which
is very active in women entrepreneurship activities. See https://www.twcc-tz.org/ (accessed 18 November 2021).
12 CROSS-BORDER TRADE IN THE PRE- AND POST-PANDEMIC ENVIRONMENT

• Providing marketing support through the products suitable for their businesses. Access
organization of trade fairs and business visits in to capital is critical to traders, but respondents
the border countries. reported extremely limited access to formal
credit in their respective countries. Access to
• Improving access to technology. Due to the
credit was highlighted as a particular critical
pandemic and related movement restrictions,
issue for women traders. Hence, linking traders
many cross-border traders were unable to
with micro-finance institutions would provide
continue their businesses. Trading online
a good option if those institutions were willing
could provide an option. For this to happen,
to develop products adapted to cross-border
traders need to be trained on buying and
traders’ unstable business cycles and other
selling online, using electronic money/cashless
shortcomings related to the small size of their
payment systems, etc. Governments could
businesses, or to hurdles affecting women in
improve traders’ technical skills by offering free
particular, such as lack of collateral.
online training courses and materials. Such
interventions would help cross-border traders • CBTAs could liaise with the government to
transition to new technologies, resume business provide traders who cross the border regularly
operations and expand business channels. with passes/cards that have extended validity
or could be used several times to spare traders
• Undertaking tax interventions that support
the costs of buying border passes every time
cross-border trade, including tax reductions,
they travel. For example, the temporary border
tax refunds and tax credits for informal traders
pass given by Tanzania Immigration is meant for
who resolve to register their businesses.
single-use, which means a trader must buy it
daily or every time she/he crosses the border.
Cross-border trade associations
• CBTAs could advocate for the development
Respondents indicated that they expected CBTAs to
and strict enforcement of policies that address
provide support for them to, among others, handle
gender-based violence at the border and
challenges at the border, facilitate setting up business
impose heavy sanctions on perpetrators.
networks, organize training activities, and ease the
delivery of border passes. Additional measures • CBTAs could promote better collaboration
suggested included the following: between traders and border authorities through
forums and dialogues.
• CBTAs could link small traders to micro-finance
institutions and lobby for the development of
CASE STUDIES 13

4. CASE STUDIES

4.1 MAGGIE KAMCHACHA, MALAWI

Maggie Kamchacha is a Malawian cross-border

trader from Karonga who conducts her business at
the Songwe/Kasumulu border between Malawi and the
United Republic of Tanzania. She has been an informal
trader since 2018. Before starting her business, Ms.
Kamchacha was a government employee in Lilongwe.
In 2018, she moved to Karonga to work for a non-
governmental organization. Towards the end of the
year, when her contract was not renewed, she decided
to establish a business in Karonga, which she named
Cristal Waters Creation. One of Ms. Kamchacha’s main
business objectives was to open a shop for electric
home appliances. The business idea came up after
seeing that there was market demand in Karonga for
electronic home appliances, as local residents who
needed them would usually travel to the capital of
Lilongwe, about 600 km away, to buy them.
Trading informally
Ms. Kamchacha started her business selling small
radios, solar appliances, simple music systems and
other accessories around the city market. She mainly Maggie Kamcha posing with her wares in her shop. ©UNCTAD
bought her merchandise from neighbouring Kyela in
the United Republic of Tanzania. She did not register feed her family and nothing else. She ran her business
her business with the Registrar General in Malawi and in this way for a little over a year.
did not hold a business license.
UNCTAD capacity-building activities
“I would acquire a border pass in Karonga and travel
In 2019, Ms. Kamchacha applied to attend an UNCTAD
to Kyela to buy electronic items and accessories,” she
border training session through the Karonga Chapter
explained. “I would pass through the official border
of the Cross-border Trade Association of Malawi. She
post with a small amount of merchandise for customs
said the six-day training programme was transformative
inspection and payments, while the rest would be with
and instructive.
the border porters who would cross through unofficial
routes/informal paths. I would then use the customs
receipts and papers related to declared goods to “After learning and practicing the
transport both consignments to Karonga.”
entrepreneurial skills during the
Such practices, however, were neither successful nor
training, I was transformed inside
sustainable. Ms. Kamchacha recalls that she lost her
merchandise on numerous occasions due to robberies out. The first thing I did after the
by border porters who claimed that customs officials training was a self and business
had seized the goods. In addition, very often she had no diagnosis to know what I was
option other than to bribe officers at all five inspection
doing right or wrong and the way I
roadblocks on the way from Kyela to Karonga to be
able to reach her destination. As a result, her business was running my business.”
suffered. She said that she was only making enough to
14 CROSS-BORDER TRADE IN THE PRE- AND POST-PANDEMIC ENVIRONMENT

Ms. Kamchacha decided to apply what she had learned more efficiently, giving preference to goods originating
during the training programme to her business. She from the SADC countries in order to benefit from
set a one-year-goal plan divided into quarterly plans. the rules of the SADC Trade Protocol for products
The plan called for increasing her sales revenue by manufactured in the region.
diversifying her offerings to include products in demand
Diversification
by the middle- and upper-class market, and registering
her business and obtaining a business license. She To expand her sources of supply, Ms. Kamchacha
developed a step-by-step programme of action to started travelling to South Africa to buy electrical
reach her goals. appliances manufactured there, including televisions,
refrigerators, cooking stoves and musical items.
Journey to formalization
Importing products in Malawi from South Africa was
Ms. Kamchacha registered her business with the not as expensive as she had anticipated. Moreover, the
Registrar General in 2019 and obtained a business goods could benefit from the SADC Trade Protocol,
license to start operating as a formal business. She being manufactured in the region.
realized that registration came with benefits such
as legal protection, access to government finance
packages and other business incentives. In January “Within six months, my business
2020, she reached the goal of diversifying her products sales revenues had soared by 70
by including television sets, music appliances and
per cent from the original figures in
refrigerators, which she imported from the United
Republic of Tanzania. In terms of preparation to cross 2019. My then small business had
the border, she made sure to have a valid border pass gradually expanded into a large
and sufficient cash to buy the goods she needed before business. I attribute this growth to
embarking on her travel. She also made use of the
knowledge she had acquired during the component
the life-changing training offered
of the training programme devoted to trade rules and by UNCTAD. To me, there is a clear
customs procedures. She asked customs officials positive correlation between the
about the applicable tax rates and duties for the goods
willingness to put the behavioural
she would buy and bring back to Malawi. Her initial
expectation was that customs officials would not be changes and the understanding
helpful. To her surprise, they were cooperative and of trade rules and procedures in
provided her with the additional information she needed practice and business growth. The
beyond what was posted at the border.
more you apply them, the more
Once she had bought her goods, Ms. Kamchacha your business will grow”.
passed through the official border posts to return to
Karonga. She filled in the declaration form and other
customs form, and realized that the amount of taxes Mitigating the impact of COVID-19
and other duties she had to pay for crossing the border
The COVID-19 pandemic negatively affected many
legally was far less than what she used to pay to informal
businesses, including Cristal Waters Creation. Due to
agents when using the unofficial routes. In addition,
national lockdowns and the closure of the borders,
the clearance process was carried out smoothly,
particularly South African borders, Ms. Kamchacha’s
without any abuse, bribes or loss of merchandise. Ms.
business stopped growing, her clientele shrank, and
Kamchacha also realized that the knowledge she had
income losses mounted rapidly. To counteract it, she
acquired during the training programme about the rules
implemented some of the suggestions that had been
of origin could be useful for her business. She noted,
discussed at the UNCTAD training sessions:
for example, that electrical appliances originating from
China or the United Arab Emirates fetched higher • Further diversification. At the beginning of
duties than appliances originating from the United 2021, Ms. Kamchacha diversified the business
Republic of Tanzania or other member countries of the to foodstuffs, including beef (e.g. cut beef,
Southern African Development Community (SADC). meatballs, beef sausages, etc.), all sourced
That knowledge prompted her to source her goods
CASE STUDIES 15

locally. The foodstuff business has been growing

fast since the onset of the pandemic.
• Online procurement. In response to the border
closures with South Africa, Ms. Kamchacha
started ordering and selling electrical
appliances online. Thus far, the business has
been successful.
Overview of future plans
Ms. Kamchacha used her ability to adapt her business
model to online trading to save her enterprise from
the negative repercussions of the pandemic. Looking
forward, she is investing in building an online market
and supply chain system that will allow her business
to survive and thrive in the current environment.

4.2 GLADYS NGWENYAMA, ZAMBIA

Gladys Ngwenyama is a 38-year-old cross-border

trader from Zambia who operates at the Mwami/
Mchinji border post between Zambia and Malawi.
She has been an informal cross-border trader for
the past 10 years. During this period, she has been
trading in women’s apparel, including Chitenje fabrics,
clothes and other accessories. She buys her products
from Malawi and sells them in Chipata, Zambia. Her
business is currently operating with a working capital
of 50,000 kwacha (around US$3,150) that she has
built up over the years.
Trading informally
Until recently, Ms. Ngwenyama had never registered or A stall displaying african print fabrics at a Flea Market.
considered registering her business with the Zambian ©Nyasha Musawani
Patent and Company Registration Agency (PACRA).
Since the start of her activities over a decade ago. amount equivalent to the value of the goods she was
She thought that registering a business was only carrying. She did not receive any receipt proving the
for large companies, not for small ones like hers. payment of the fine or its fairness, and she could not
All of her business transactions were informal. To complain to anyone since her business was informal.
buy the goods to sell in a market stall in the Kapata Ms. Ngwenyama also said that she would pay bribes
market in Chipata, Gladys relied on informal routes to equivalent to 5,000 kwacha (approximately US$300)
cross the Mwami/Mchinji border, known as Zalewa, to carry out her business. She continued to run her
which means “to avoid.” However, because of business informally until the beginning of 2021.
the absence of security on those informal routes,
UNCTAD capacity-building activities
Ms. Ngwenyama remembers occasions when her
goods were confiscated by customs border patrols, Ms. Ngwenyama is a member of the Zambian Cross-
including once when they seized her merchandise border Trade Association. In February 2021, she
worth 20,000 kwacha (approximately US$1,060). On attended the UNCTAD training sessions held in Chipata
another occasion while using the Zalewa route, she was for informal and small-scale traders operating at the
caught by the patrol and had to pay a fine of 15,000 Mwami/Mchinji border. She said that the programme
kwacha (approximately US$940) to cross the border, an was helpful because it provided the opportunity to learn
16 CROSS-BORDER TRADE IN THE PRE- AND POST-PANDEMIC ENVIRONMENT

about trade rules and procedures applied at the border. and predictable. Moreover, she realized that she could
Before this training experience, her knowledge about benefit from the STR established by the Common
those rules and procedures was based on rumours Market for Eastern and Southern Africa.
and stories shared by other informal cross-border
Diversification
traders, premised on the view that the best option
was to avoid any official crossing route. As a result of the training programme, and particularly
the entrepreneurship component, Ms. Ngwenyama
UNCTAD training programme demystified this
decided to diversify her business and start selling
assumption. First, when attending the training sessions,
apparel for weddings as well as party decorations and
Ms. Ngwenyama noted that border officials, including
accessories, since the demand for weddings was still
customs, immigration and police officers, were in the
high despite the pandemic. The new business does
same conference hall as cross-border traders. Second,
not involve any cross-border trade and is an addition
she noted that the training sessions were conducted
to the original cross-border trade business.
in clear and straightforward language, clarifying the
distinct roles of officials and traders. She said that the Mitigating the impact of COVID-19
session focusing on traders’ rights and obligations Like most other cross-border trade, Ms. Ngwenyama’s
was a particular eye-opener for her since she was not business was not spared from the effects of COVID-19.
aware of these matters. Moreover, she became familiar She indicated that her business suffered from declining
with the simplified trade regime (STR), a new trade sales and a significantly reduced number of clients,
tool for her. The six-day training programme made Ms. which is what led her to open her new business related
Ngwenyama, consider changing her way of trading. to weddings.
Journey to formalization
Ms. Ngwenyama decided to put into practice what 4.3 MARY MWEEMBA, ZAMBIA
she had learned through the training programme. As
Mary Mweemba is a 50-year-old Zambian cross-border
a first step, she approached PACRA to register her
trader conducting business at the Nakonde/ Tunduma
business under the name of Upendi General Dealers.
border between the United Republic of Tanzania and
The business registration process was smooth, in
Zambia. She has been operating as an informal cross-
part because during the training participants had
border trader for the past 15 years. She trades in rice,
been asked to go to PACRA and obtain business
beans, sweet potatoes and groundnuts. She can count
registration information, including the various steps
on a working capital of 60,000 kwacha (approximately
to follow to register.
US$3,770) built up over the years. She sells her goods
Registration allowed Ms. Ngwenyama to open sold to wholesale distributors who in turn sell them
a business bank account in Chipata. She started to institutions like boarding schools and hospitals.
collecting and keeping records of all business
transactions, one of the recommendations made at
the training sessions.
As a second key step, she stopped using informal
routes and started crossing at official borders. She
noted that the training programme made this possible
because one of assignments was to collect information
from customs and immigration officials about customs
procedures. As a result, she was able to visit the border
and become familiar with procedures and processes.
Ms. Ngwenyama concluded that, overall, crossing
the border through official border posts was a better
option than using the informal crossings because it
was less expensive and the costs were transparent Outdoor market food stall. ©UNCTAD
CASE STUDIES 17

Trading informally Ms. Mweemba learned that she could benefit from the
Common Market for Eastern and Southern Africa STR
Since starting her business, Ms. Mweemba had always
because the goods she was trading were included
operated it informally, until recently. She did not register
in the STR Common List. Moreover, thanks to the
the business with PACRA because of its small size
training programme she realized that the goods would
and fear of heavy taxation that would impact business
be duty-free.
profitability and survival. As she bluntly put it, “the
taxman is an enemy to the business and should be Mitigating the impact of COVID-19
avoided at all costs.” Ms. Mweemba’s business was negatively affected
After she was introduced to cross-border trade, she by the COVID-19 pandemic and the closure of the
learned tactics from friends and fellow cross-border borders. For example, she could no longer cross the
border to buy beans in Mbeya in the United Republic
traders to avoid police, immigration and customs
of Tanzania, a key component of her business. As a
officers and get her goods across the border using
result, she decided to diversify and opened a stationery
informal routes. Once, however, while crossing using
business in addition to continuing her cross-border
an informal route, she ran into customs officials who
activities.
confiscated her goods worth about 20,000 Zambian
Kwacha (approximately US$1,060). Even then, Ms. Overview of future plans
Mweemba did not consider turning to formal trade. Ms. Mweemba indicated that she had plans to expand
UNCTAD capacity-building activities her business and open a business branch in another
district. She highlighted that having a formal business
Ms. Mweemba ultimately recognized that she knew little would open new opportunities, such as selling her
about trade rules and procedures and, by extension, goods directly to institutions like boarding schools
her rights and obligations. In 2019, she attended and hospitals.
UNCTAD training sessions held in Chipata for cross-
border traders using the Nakonde/Tunduma border. She
said the training programme was the first opportunity 4.4 REHEMA HANDICRAFTS, UNITED
for her to get acquainted with a number of business REPUBLIC OF TANZANIA
and trade rules. For example, she was unaware of the
regional arrangements, and she had never even heard Rehema Handicrafts is a business established in
about the simplified trade regime (STR). January 2020 and run by four Tanzanian partners:
Rehema Kalisa, Tulinagwa Mwangupili, Mariam
Journey to formalization Mwakamisa and Tulimbumi Korosso. The business
Following her participation in UNCTAD training revolves around producing and selling handicrafts,
programme, Ms. Mweemba was determined to including beads and other beads products, batiks, tie
implement what she had learned and decided to and dye cloth, decorated leather sandals, and beaded
switch the way she operated her business. As a first ladies accessories such as earrings, necklaces and
rings.
step, she registered her business at PACRA under the
name of Jacinth Enterprises. She said that registering Before joining the partnership, Ms. Korosso operated
was easy because one of the practical assignments a sole proprietorship that she had started in 2016 after
during the training workshop was to collect registration leaving formal employment. She designed and made
information from PACRA. She also opened business beaded ladies handbags, purses, table mats, and
and personal bank accounts in Nakonde in order to ladies accessories, and used tie and dye and batik
separate her personal expenditures from business materials to make ladies’ and men’s attire. Her main
transactions, and she put in place a cashbook system customers were locals from Kyela, Mbeya and Dar es
to issue and record all business receipts. Finally, Salaam in the United Republic of Tanzania, and some
Ms. Mweemba decided she was ready to use official clients from Malawi.
borders for her crossings. She said she was pleasantly Ms. Kalisa ran her own handicraft business established
surprised by what she encountered: “The procedures in 2015 in Mbeya before joining the partnership. She
and processes at the official border posts were much was selling handicrafts, including table mats, necklaces,
easier and simpler than I thought.” and ladies’ handbags and purses. She was also a
18 CROSS-BORDER TRADE IN THE PRE- AND POST-PANDEMIC ENVIRONMENT

To date, the four partners still run their respective

activities along with the partnership business that
operates as a separate entity.
UNCTAD capacity-building activities
The first three partners, Ms Kalisa, Ms. Mwangupili and
Ms. Korosso, attended UNCTAD training sessions in
2019, while Ms. Mwakamisa, who joined the partnership
later, participated in the workshop held in 2021. After
the three partners attended the 2019 training sessions,
they decided to meet every three weeks to share
experiences and discuss the challenges each was
encountering in business. It soon became evident that it
would be hard for them to achieve their respective goals
operating independently. Since they were operating in
similar sectors, they decided to combine their resources
and skills and jointly explore new business avenues,
building on what they had learned during the training
programme.
Journey to formalization
Following the decision to form a partnership, the
women decided to register the business at the district
Rehema Handicrafts – beaded handabgs and table mats level. In addition, they developed a business strategy:
©UNCTAD they would work on their own respective businesses
four days a week, devote two days a week to the
handicraft teacher, training women to make handicrafts partnership, and hire an employee who would work for
and decorations using beads. In 2016, she moved the partnership business on a full-time basis. During
her business to Kyela to target tourist hotels in Kyela, the two days a week dedicated to the partnership,
Mbeya, Dar es Salaam and Arusha. In Kyela, she met the women held meetings to:
Ms. Korosso, one of her trainees. In 2017, Ms. Kalisa
• Review their short- and long-term goals and
further expanded her business to Kigali, Rwanda.
make the necessary adjustments.
Before joining the partnership, Ms. Mwangupili owned
• As the basis for future decisions, review all
a business in Kyela that she had established in 2017,
business transactions, including production,
selling ladies clothes and handbags and women’s,
purchases and sales, using bookkeeping skills
men’s and children’s shoes that she bought in Malawi.
acquired through the UNCTAD training session
In addition, she ran a décor business where she
on business creation.
designed decorations for ceremonies and events
using traditional articles. Ms. Mwangupili used social • Set daily, weekly and monthly goals for the
media platforms to advertise and market her products, partnership.
and she was getting orders from various parts of the • Develop plans for marketing.
United Republic of Tanzania.
Following the registration of the business, the partners
For her part, before joining the partnership, Ms. decided to open a shop in the Kyela city centre. When
Mwakamisa operated a business that she had the business started growing, the Kyela district council
established in 2015 selling all types of stationery, took note and encouraged the partners to apply for a
printing, and computer accessories. Ms. Mwakamisa government grant, as the district council had a fund
joined the partnership after attending a Rehema reserved for entrepreneurs working as a group. The
Handicrafts workshop in 2020. application was successful, and the partners received
a grant of TZS 12 million (approximately US$5,200)
to strengthen the business. The new injection of
CASE STUDIES 19

funds enabled the partners to increase their range that no visa was required to move from the United
of products offered and undertake fresh marketing Republic of Tanzania to Rwanda, only a valid passport
efforts to reach clients in neighbouring Mbeya and or temporary travel document, and that under the EAC’s
across the border in Karonga, Malawi. The business simplified trade regime (STR) customs procedures
also received support from the District Commissioner, had been made considerably easier. The partners
who encouraged his guests and visitors to pass by the indicated that they do not carry consignments that
shop because he thought it was an exemplary example exceed US$2,000 and hold certificates of origin to be
of local entrepreneurship. In July 2020, the partners able to benefit from the STR. They said that crossing
were sponsored by the Kyela district administration the border through the official posts and using the
to attend exhibitions in Mbeya, followed by training STR has proved to be less expensive than crossing
activities on how to make quality handcrafts. informally, which often requires paying bribes.
Diversification Mitigating the impact of COVID-19
Since its inception, the business partnership has been The partners indicated that since their handicraft
thriving, attracting both local and foreign customers, business depended significantly on customers from
mainly from Malawi, Zambia and Rwanda. The women Malawi and Rwanda, the number of foreign clients
have been proactive in taking their products to Malawi, declined when the pandemic hit. In July 2021, no
in particular to the Karonga district, where they can customers were recorded from Malawi. Business from
be sold at good prices. Drawing on what they learned Rwanda improved as soon as that country relaxed
from the UNCTAD training programme, the partners some of its border measures, though due to pandemic
now feel confident using official border posts, better restrictions the partners could still not travel there
understand their obligations and rights, and are not themselves and relied on agents who travelled by bus
afraid to seek assistance from customs officials. from Dar es Salaam to Kigali to deliver the products.
Even then, since handicraft sales were very much
dependent on tourism, sales remained subdued.
“The training has been very fruitful,
Seeing the adverse turn of their business, the partners
empowering us with entrepreneurial decided to re-strategize and review their plans and
skills. It brought to light the issues objectives. They adjusted their production and
of trade rules and procedures on marketing plans and decided to innovate and design
products to suit the local market at all levels. The
cross-border trade, a topic that is results were impressive.
largely misunderstood by informal
traders.”
“We produced goods suitable for
men, women and children such as
The partners also indicated that they now understand
decorated sandals, culture wrist
how the Southern African Development Community
Trade Protocol applies when crossing to Malawi, so bands worn mainly by youths,
they always remember to carry valid border passes, printed t-shirts, and printed
fill in the necessary declaration and payment forms, cups for events. Currently, our
and hold certificates of origin delivered by the Tanzania
Chambers of Commerce, Industry and Agriculture. business is booming, and sales are
increasing tremendously, coupled
One of the partners, Ms Kalisa frequently travels to
Rwanda to sell goods produced through the partnership with marketing efforts. Now we
business as well as those she produces as part of her have customers from big cities like
own business. She explained that understanding the Dar es Salaam, Dodoma, Mwanza
trade regimes of the different trade blocs had helped
her strengthen her business. Furthermore, given that
and Arusha.”
Rwanda is a member of the Eastern and Southern
African Community (EAC), she became aware that
20 CROSS-BORDER TRADE IN THE PRE- AND POST-PANDEMIC ENVIRONMENT

The partners attribute their achievements to their

willingness to revise their plans, set new goals, and
be courageous enough to change their marketing
approach. To date, they have hired three employees
whom they have trained to assist in handicraft
production. Ms. Mwakamisa is permanently stationed
in the shop in Kyela to handle daily sales.
Overview of future plans
Looking forward, the partners plan to expand the
business and they remain optimistic that the tourism
industry will come back to life once the COVID-19
pandemic is contained and the borders fully opened.
They have plans to meet with the district council
administration and the Tanzania Chamber of Commerce
and Agriculture in Kyela to organize an exhibition in
collaboration with the Cross-border Trade Association
of Malawi in February 2022. That event would bring
together cross-border traders from both countries
and reopen market opportunities for their business.
UNCTAD has indeed found that trade fairs are good
opportunities to secure access to domestic and
international markets, particularly for traders dealing
with non-agricultural products (UNCTAD 2019). In
addition, the partners are in the process of establishing
Christine King’ola in her banana farm. ©UNCTAD
a handicraft training centre for youth. Graduates from
the centre will be allowed to work in groups, and the
partners will advise them on quality issues and help Tanzania. In addition to bananas, Christine planted
them find a market for their products. The partners’ beans on a small scale and had dairy cows to sell
goal is to make their business a handicraft hub in the milk and for manure to use as fertilizer.
southern regions, including Malawi and Zambia. The COVID-19 challenge
Until March 2020 Cristine’s business was going
4.5 CHRISTINE KING’OLA, KENYA 8 well and prospects for growth were promising. By
that time the farm gate price for a banana stalk had
Christine King’ola is a businesswoman engaged in both increased from KSh. 180 to KSh.200, making the
cross-border trade and farming. She lives in the border business profitable. But then the COVID-19 pandemic
town of Taveta in Kenya and owns approximately two hit. Initially it did not hurt Christine’s business because
hectares of land in the Mrabani area, where she runs daily activities continued normally. Sales to buyers
a small-scale banana farm. After starting operations from Mombasa continued, but then the closure of
in 2018, Christine managed to plant more than 800 the border stopped sales to the United Republic of
banana plants by using an irrigation system. The Tanzania. It was when the curfew was implemented
business was demanding, so Christine hired two full- that the situation deteriorated sharply.
time laborers. Her first harvest in early 2000 brought “Starting in June 2020, I could not go out to market my
between 500 and 600 bunches of bananas. Selling bananas,” Christine explained. “I devised a strategy
the product was easy: she sold wholesale at farm- to use brokers and it worked for few weeks, but then
gate prices. Her main customers were traders from the brokers gave up because the purchasing power of
Mombasa, Kenya, and from the United Republic of customers had gone down due to the many restrictions.

8
The outcomes of UNCTAD’s training workshops in Kenya are not covered in this report since they took place in November
2021, after the finalization of the impact assessment. Nevertheless, Christine King’ola’s experience is presented here as a
valuable example of success story.
CASE STUDIES 21

I remember looking at piles and piles of ripe banana With her confidence and her capital restored, Christine
bunches lying there rotting all over the farm, with was able to identify several business opportunities in
nowhere to sell. What I already had consigned at and outside Taveta. With her new financial muscle, she
the market was thrown away in my absence. I was started a cross-border trade business in cereals (maize
disappointed and disheartened. And on top of all the and beans), setting up a network of cereal suppliers
other losses I had incurred, I owed transporters more across buyers in Taveta and Mombasa.
than KSh. 30,000.”
Today, though she still regards banana farming as
As the crisis wore on, Christine struggled to find ways her primary business, Christine operates a number
to move forward. of businesses successfully, with minimum capital of
more than KShs. 20,000/ available at any given time.
“The effects of the pandemic challenged me to go the
Looking back, she concedes that while the business
extra mile and think about how I could make some
environment during the pandemic was very difficult, she
economic use of the bananas from my farm,” she
was able to overcome the challenges with creativity,
recalled. “I realized it was too soon to give up. I still
discipline, persistence and hard work and emerge
had determination to grow and thrive in business.”
strong at last.
It occurred to Christine that by raising pigs she could
The initial training impact
use the products from banana farming and generate a
reasonable income. So she sold two of her low-yielding Christine attended the UNCTAD training workshop
dairy cows (and was careful to keep the high-yielding for cross-border traders at Taveta from 15–20
ones) and purchased four pigs – one boar and three November 2021. She said that the training exceeded
sows. her expectations and noted that it brought about
several changes in her entrepreneurial skills. She
Christine started feeding the pigs with bananas from her
now approaches the business differently by carefully
farm and the remains of other products. This allowed
estimating costs and profit margins, and is proactive
her to save money that she would have otherwise spent
in identifying and exploiting new market opportunities.
to buy commercial feed. She even got bananas from
For example, Christine has diversified the range of
other neighboring farms for free. Within only a few
cereals she trades beyond maize and beans, with a
months, by December 2020, Christine had 21 pigs.
resulting increase in business income and growth.
Starting in February 2021, Christine’s situation began She now keeps business and financial records and
to turn around, starting with an increase in sales of milk collects necessary information before embarking on
up to 16 liters per day. In June, COVID-19 restrictions any new business activity, including checking sources
were eased and cross-border trade resumed at the of supplies, the customer base, prices etc. Finally,
Taveta/Holili border between Kenya and the United Christine says she has reaffirmed her commitment to
Republic of Tanzania, though with strict adherence to quality: she believes that providing her customers with
COVID-19 protocols. Finally, in August 2021, Christine’s the best quality will move her business up the line.
banana business started to boom because while
Importantly, the training enhanced Christine’s
demand was high, supply could not keep up because
understanding of customs rules and procedures,
many farmers had stopped working their farms. But
which, as she notes, “has made my business life easier.”
Christine’s banana harvests had been thriving all
She used to take cereals from the United Republic of
along, and she started consigning shipments herself
Tanzania into Kenya through unofficial routes to evade
to Mombasa and Holili, avoiding middlemen and
taxes and duties, but had incurred many losses as a
maximizing profits. By September she had raised
result of having to bribe officials such a police and
more than KSh. 15,000/ in capital.
customs officers, losing consignments to porters,
Business turnaround and new business direction and paying fines and penalties when her goods were
With bananas fetching high prices, it was no longer seized by customs officials.
cost-effective for Christine to use them to feed her pigs, “The training showed me that cereals can be traded
so she took a bold decision to sell all the pigs and focus between Kenya and Tanzania duty free,” she reported.
on banana sales. At the same time, she continued to “Custom duties and other taxes charged on other
increase her savings at a commercial bank. products are not as high as I and other traders thought
them to be.”
22 CROSS-BORDER TRADE IN THE PRE- AND POST-PANDEMIC ENVIRONMENT

Christine’s priority is now safety and security, and

official crossing routes guarantee that. She recognizes
the importance of being transparent by correctly filling
out customs forms and declaring all goods, and her
experience has been that truthful customs declarations
have been met with fair assessments of the taxes
and levies due. In addition, she now has the legal
avenues available to file a complaint if she considers
an assessment to be unfair.
“I am now more confident than ever in crossing
the border to Tanzania and procuring goods there
because I have in-depth knowledge of my rights and
obligations as a small-scale cross-border trader,”
Christine explained. “I trust that my business has a
bright future.”
REFERENCES 23

REFERENCES

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Malawi. Available at https://knowledgehub.southernafricatrust.org/research/the-impact-of-the-covid-19-
pandemic-on-women-cross-border-traders-in-malawi/
TradeMark East Africa (2021). The effects of COVID-19 on women cross border traders in East Africa. Available
at https://www.trademarkea.com/publication/the-effects-of-covid-19-on-women-cross-border-traders-
in-east-africa/
UNCTAD (2019). BORDERLINE: Women in Informal cross-border trade in Malawi, the United Republic of
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challenges of trading across borders. International Trade Centre Trade Forum. Available at https://digital.
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Zarrilli S and Linoci M (2020). What future for women small-scale and informal cross-border traders when
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Zarrilli S and Lopez M (2020). Leveraging digital solutions to seize the potential of informal cross-border trade.
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 gender@unctad.org
http://unctad.org/gender

Designed and printed at United Nations, Geneva – 2119745 (E) – March 2022 – 142 – UNCTAD/DITC/2021/3