(KAMPALA) – A new customs bond system designed to reduce the cost of doing business across East Africa has been launched in Uganda, with Kenya and Rwanda joining in the pilot phase. The East African Community (EAC) Regional Customs Bond, introduced in Kampala, will allow cross border traders to move goods across participating countries using just one customs guarantee instead of multiple national bonds.
This shift is expected to simplify cargo movement, reduce border delays and improve liquidity for businesses. The regional bond will replace the current system, where traders moving goods from key ports like Mombasa to inland destinations such as Kampala or Kigali are required to post individual customs bonds at each border crossing.
The new bond initiative was rolled out during a high level event attended by government ministers, customs and revenue authorities, logistics operators, banks and insurance firms. The system is being launched initially in Uganda, Kenya and Rwanda, with other EAC Partner States including South Sudan, Tanzania, Burundi, Somalia and the Democratic Republic of Congo expected to join during the full rollout phase.
The Regional Customs Bond is linked to an automated compliance system that integrates cargo tracking with customs and financial institutions, enabling end to end monitoring of goods in transit. This aims to reduce fraud and revenue leakage, while giving governments greater visibility over cross border trade.
According to Uganda’s Minister of State for East African Community Affairs, James Magonde Ikuya, the new bond represents a major breakthrough in removing structural barriers to intra-regional trade.
“By eliminating multiple bond requirements, we are cutting unnecessary costs, easing cargo movement and empowering our business community,” he said.
EAC Secretary General Veronica Nduva echoed the sentiment, adding that the bond would unlock an estimated USD 2 billion in working capital previously tied up in financial guarantees.
“This is money that businesses can now reinvest in operations, hiring, logistics and innovation,” she said.
Nduva explained that the current model had been discouraging regional trade due to its high upfront cost structure.
“Each year, over USD 35 billion in goods pass through our corridors. Much of this trade is burdened by high financial guarantees. The EAC Bond cuts those costs and streamlines compliance,” she said.
The new system is part of the broader digital trade infrastructure being developed under the EAC Single Customs Territory initiative, which aims to create a seamless market across the region. Other innovations include the Regional Electronic Cargo Tracking System (RECTS), which has already reduced average cargo transit times by 40 percent and saved member states over USD 250 million in potential losses.
EAC Deputy Secretary General for Customs, Trade and Monetary Affairs, Annette Ssemuwemba Mutaawe, said the EAC Bond is the result of over 10 years of collaboration between governments, customs bodies and the private sector.
“This reflects our shared resolve to remove bottlenecks and improve the ease of doing business across borders,” she said.
For businesses in South Sudan, the eventual integration into the EAC Bond system could deliver significant gains. As a landlocked country that relies heavily on imports through Mombasa and the Northern Corridor, South Sudan faces some of the highest logistics costs in the region. The removal of multiple bond requirements and the adoption of a streamlined, real time cargo tracking system would offer cost savings, reduce risks, and improve reliability for importers and exporters operating between Juba and East African ports.
Trade experts suggest that for South Sudan, where transportation and logistics account for nearly 40 percent of total import costs, joining the EAC Bond could lower operational expenses and strengthen supply chain security.
As the system is expanded to include all Partner States, South Sudan’s participation will be critical to ensuring its traders are not left behind in the regional shift towards integrated customs and logistics management.
The system also provides opportunities for South Sudanese banks and insurance providers to integrate with the regional trade finance ecosystem, offering guarantees, digital tracking services and data backed financial products that support SMEs engaged in cross border commerce.
The new bond system aims to offer:
| Feature | Current System | EAC Bond System |
|---|---|---|
| Customs Guarantee | Separate national bonds per country | One regional bond covering all borders |
| Capital Requirement | High – capital locked at every border | Lower – capital freed up for business |
| Transit Time | Slower – multiple clearance stops | Faster – streamlined digital clearance |
| Risk and Compliance Monitoring | Fragmented and manual | Automated and integrated |
| Trade Costs | Higher due to duplication | Reduced due to consolidation |
