Maravi

Nakonde should be made tax-free zone – Shawa

Nakonde should be made tax-free zone – Shawa
Written by Chibaula Silwamba
Tuesday, January 13, 2009 9:51:04 AM

NAKONDE town should be made a tax-free zone, Northern Province minister Charles Shawa has said. And some Zambian traders have complained that Tanzanians were monopolistically determining the foreign exchange rate without following the recognised rate. Analysing Zambia’s trade relationship with Tanzania and Malawi, Shawa said there was a lot of trade among the three countries.


He, however, said Zambia and Tanzania traded more with each other, although the latter had an upper hand because it had declared Tunduma a tax-free zone, hence goods were cheaper, forcing Zambians to order goods from there for resale in the country.

"So many people from the Copperbelt, from Lusaka are going into Nakonde to do business but what happens there is that they cross into Tunduma and there is a big market there and on that market, the Tanzanian government has designated Tunduma market as a tax-free zone," Shawa said.

He therefore said the Zambian government should declare Nakonde a tax-free zone to level the playing field.

Shawa said trade among Zambia, Tanzania and Malawi was very high.

"Nakonde border line is so wide and there is a lot of trade; there is a lot of money that is going into Nakonde. There is a lot of trade; people are going into Tanzania, others are going into Malawi through Nakonde," he said.

Shawa observed that the border at Nakonde was so porous, leading to rampant smuggling.

A recent check at the border area revealed several Zambians trooping to Tunduma while others proceeded to Mbeya to buy goods for resale in Lusaka and Copperbelt.

Various goods such as clothes, foods, drinks, beer and bedding were bought from Tunduma at relatively low prices. There is also a high volume of vehicles being transported from the port of Dar es Salaam in Tanzania to Zambia and the Democratic Republic of Congo (DRC), making Nakonde a hive of activity day and night.

Some Zambians talked to supported Shawa's call for Nakonde to be turned into a tax-free zone.

"I think it might help to declare this place a tax-free zone," said Joyce Musonda of Kitwe, who was found buying goods in Tunduma. "Tanzanian traders are making a lot of money out of Zambians."

Another trader who declined to be named complained that Tanzanians had the monopoly in determining the exchange rate between Tanzania's shilling and the Zambian kwacha without necessarily following the recognised international exchange rate.

"Tanzanians determine at how much you will buy the shilling. Tanzanians have formed a cartel that determines the exchange rate. If Tanzanians want the kwacha to fall, they will just tell you that your currency has depreciated and when they want to please you they will say, 'now the kwacha has appreciated’, but that will be by a very small margin. As Zambians, we have no say," said the trader.

Labels: CHARLES SHAWA, MALAWI, NAKONDE, TANZANIA, TAX FREE ZONES, TRADE

posted by MrK @ 9:52 AM