Trade is an essential driver of economic growth and development. However, the high cost of trade has remained a significant barrier to the success of cross-border trade in many regions across the world. One-stop border posts (OSBPs) have been introduced in various regions, including East Africa, to reduce the cost of trade and facilitate trade flows. But what is the impact of OSBPs on the economy and the livelihoods of households in the region?
This report provides insights into the impact of OSBPs on the economy and households in East Africa. It assesses how reduced trade costs resulting from the introduction of OSBPs have been transmitted to the rest of the economy, particularly how this has affected consumer prices and household expenditure.
To assess the impact of OSBPs, the study analysed the Busia (Kenya-Uganda) and Taveta-Holili (Kenya-Tanzania) OSBPs. The study selected two products – maize and rice – based on two criteria: the products had to be widely consumed by households in the region, and they had to be regularly traded among the countries of the East African Community (EAC) and across OSBPs.
The report found that OSBPs have had a positive impact on reducing consumer prices, increasing household income, and stimulating economic growth in the region. OSBPs have the potential to enhance cross-border trade and investment in the region, making it easier for traders to conduct business across borders, and reducing the cost of trade for businesses and households.