The governments of Uganda and Tanzania have taken a major step toward strengthening economic ties and addressing a persistent trade imbalance after signing the Agreed Minutes of the Fifth Session of the Joint Permanent Commission (JPC) in Dar es Salaam. The agreement commits both countries to removing longstanding trade bottlenecks that have hindered balanced commerce and to implementing infrastructure and policy reforms aimed at deepening regional economic integration.
Trade between the two East African neighbours has long been marked by an uneven pattern, with Tanzania exporting far more to Uganda than vice versa. According to official data for 2025, Tanzania exported goods worth the equivalent of about 10 trillion Tanzanian shillings, roughly 2.7 billion dollars, to Uganda, while Uganda’s exports to Tanzania totalled just 1.1 trillion shillings, or approximately 300 million dollars. This disparity, nearly nine trillion shillings, has prompted policymakers on both sides to prioritise corrective action that can level the playing field and unlock mutual economic benefits.
At the heart of the new focus is a commitment to scrap outstanding trade barriers that have artificially inflated costs and created inefficiencies for businesses in both countries. Among the key issues identified are disputes over import charges on essential commodities such as sugar, milk, steel products and electric poles. These disputes have at times sparked tension among traders and contributed to higher prices for consumers.
Uganda’s Minister of State for Foreign Affairs, John Mulimba, described the outcome of the JPC meeting as a shift from diplomatic dialogue to practical economic execution. He said that officials are now focused on implementing concrete measures that can eliminate technical barriers and improve market access for companies in both countries.
Beyond tariff and non tariff barriers, the two nations have also emphasised the need for major infrastructure improvements to reduce logistics costs and enhance trade flows. Among the most high profile projects formalised during the discussions is the framework for the Standard Gauge Railway connecting Isaka, Lusahunga and Murongo. This planned railway is seen as a strategic artery that could dramatically cut the cost and time associated with moving goods by road.
Infrastructure specialists estimate that the railway could nearly halve transit expenses for heavy freight and reduce cargo transportation times from several days to less than 24 hours. Such gains have the potential to benefit farmers, manufacturers and exporters by making their goods more competitive and by reducing the hidden costs of trade that arise from delays, spoilage and high fuel consumption.
The infrastructure agenda does not end with rail. Energy cooperation also features prominently in the partnership, with both countries working toward shared priorities that improve reliability and connectivity. The $5 billion East African Crude Oil Pipeline, which is underway and about 79 percent complete, was highlighted during the talks. This regional energy project, financed by a consortium including Uganda and Tanzania, is expected to boost economic activity in both countries by providing a route to export Uganda’s crude oil through the Tanzanian port of Tanga when it becomes operational.
Officials said that ensuring such landmark projects are completed on schedule will be critical to achieving the broader economic integration goals. Tanzanian Foreign Minister Mahmoud Thabit Kombo cautioned that success will be judged not by the number of agreements signed but by how effectively programmes are monitored and executed at the ground level.
The agenda also includes social and human capital dimensions. In a move aimed at easing the movement of labour and supporting regional integration, both governments agreed to harmonise national identity cards to allow freer movement of workers between the two economies. This is expected to facilitate labour mobility, encourage skills sharing and foster a more integrated East African workforce — an important objective given the significant number of citizens from both countries who work, trade or do business across the shared border.
Trade and economic analysts have welcomed the renewed focus on addressing structural bottlenecks. Many see the joint interventions as complementary to broader regional integration efforts under the East African Community, which seeks to establish a seamless economic bloc with freer movement of goods, services, labour and capital.
The improved cooperation between Uganda and Tanzania also sends a positive signal to private sector actors and investors that the two governments are serious about creating a stable and predictable business environment. Reduced trade barriers and better transport infrastructure could attract investment in agriculture, manufacturing, logistics and related sectors, supporting job creation and economic diversification.
Uganda is scheduled to host the next round of high level talks with Tanzania in 2028, where officials say they will review progress, adjust strategies where necessary and build on the momentum achieved in Dar es Salaam.
As both countries move forward, industry leaders and trade associations will be watching closely to see how reforms translate into practical improvements in trade flows, cost savings for traders and broader economic growth.
Uganda’s Museveni elected new EAC chair amid regional pressures
