Factors that encourage inter-state trade/international trade in East Africa

Factors that encourage inter-state trade/international trade in East Africa

  • Differences in natural endowments especially raw materials e.g. Uganda has more agricultural raw materials but less high value minerals.
  • Specialisation also leads to inter-state trade e.g. Uganda has specialised in agricultural exports while Kenya produces more manufactured goods.
  • Differences in levels of development e.g. Kenya has a highly developed industrial sector than Uganda and Tanzania.
  • Presence of developed means of transport e.g. roads and railways which help to promote cross-border trade.
  • Outbreak of political unrest in one country reduces her level of production hence leading to international trade e.g. Uganda.
  • Formation of the East African Community which encourages peaceful trade relationships among the member countries.
  • Outbreak of natural disasters in one country can also lead to international trade to get essential goods like basins, mattresses and blankets e.g. Bududa landslides.
  • Differences in climate also lead to inter-state to get food e.g. Uganda provides a lot of maize to Kenya.
  • The need to earn government revenue through customs duty and trade licenses also leads to inter-state trade.

The need to dispose of surplus produce also leads to inter-state trade in a bid to create market for the produced items

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