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African Journal of Agricultural Marketing ISSN 2375-1061 Vol. 4 (4), pp. 001-005, April, 2016. Available online at 
www.internationalscholarsjournals.org © International Scholars Journals 

 

Author(s)                                           Author(s) retain the copyright of this article. 
 
 

 

Full Length Research Paper 

 

Legal and institutional constraints to Kenya-Uganda 

cross-border bean marketing 
 

L. W. Mauyo1*, J. R. Okalebo2, R. A. Kirkby3, R. Buruchara3, M. Ugen4 and R.O. Musebe5
 

 
1
Kenya Agricultural Productivity Project (KAPP), District Service Unit, P.O. Box 4500, Eldoret, Kenya. 

2
Department of Soil Science, Moi University, P.O. Box 1125, Eldoret, Kenya. 

3
CIAT-Africa, P.O. Box 6247, Kampala, Uganda. 

4
Namulonge Agricultural and Animal Production Research Institute (NAARI), P.O. Box 7084, Kampala, Uganda. 

5
Department of Development Studies, Moi University P.O.BOX 7670, Eldoret, Kenya. 

 
Accepted 05 August, 2015 

 
This study investigated the legal and institutional constraints to Kenya-Uganda cross-border bean marketing. 
Common bean is an important legume crop in East and Central Africa, providing protein, calories and cash income for 
rural households. There is high potential in cross-border bean trade between Kenya and Uganda. However, the 
complex methods of certification, stamp fees and institutional restrictions are some of the main reasons for bribery at 
border crossings and informal crossing points. The objectives of the study were to identify and assess the legal and 
institutional constraints, which lead to informal bean trade in the border districts of Kenya and Uganda. Purposive and 
systematic random sampling methods were used to select the study districts and bean traders respectively. One 
hundred and six respondents were interviewed using structured questionnaires. Descriptive statistics and Statistical 
Package for Social Scientists (SPSS) were used to analyse the data. The results revealed lengthy documentation 
procedures, high clearance fees, harassment by public officials and customs authorities, and instability of foreign 
exchange rates. High transportation costs due to poor roads and lack of storage facilities at border points increase 
business costs. Annual average of the formal bean exports from Uganda to Kenya from 1990 to 1998 accounted for 
only 15.2% of the total bean exports, while 83.7% was informal. In the year 2001 formal bean exports accounted for a 
value of 0.982 US$ million while 2.177 US$ million was informal. The study recommends removal of lengthy clearance 
procedures, lowering of taxes and strengthening of regional co-operation. 
 

Key words: Bean, cross-border marketing, trade barriers. 

 
INTRODUCTION 

 
In Kenya, common bean is the most important pulse and 
second to maize as food crop (GOK, 1998). The national 
annual demand for common bean has been estimated at 
500,000 metric tonnes, but the actual annual production 
is only about 125,000 metric tonnes (Muasya, 2001). The 
total area under bean cultivation in Kenya is estimated to 
be 500,000 ha (GOK, 1998) leading to actual bean yield 

of 250 kg ha
-1

 partly under mixed cropping. In pure 

stands, yields of 700kg ha
-1

 have been reported (Songa 

et al., 1995; Muasya, 2001). This yield is low compared to 

a potential yield of up to 5000 kg ha
-1

. Such high yields  
 
 
*Corresponding author. Email: lmauyo@yahoo.com. Tel: +254 

0722 403226 or +254 0734 891713 

 
 
have been achieved in other countries, such as Mexico 
under field conditions (Muasya, 2001). 

Bean consumption in Eastern and Southern Africa exc-
eeds 50 kilograms per person per year, reaching 66 kg 
per person in parts of Kisii district of Kenya (Wortmann, 
1998) . Bean also contributes 30% of the dietary energy 
in the widespread maize-based cropping systems of mild-
altitude areas of Eastern and Southern Africa (Wandel 
and Holmboe-Ottesen, 1992). Bean forms a good source 
of income for farm families. In Uganda, bean is a major 
source of food security, readily available and popular food 
to both the urban and rural population. In 1987, Food and 
Agriculture Organization, (FAO) estimated Ug-anda’s 
bean consumption as 29.3 kg per capita (Kirkby, 1987). 
However, recent studies show that the per capita 

file:///C:\Users\user\Documents\REPUBLICATION\AGRICULTURAL%20SCIENCES\AppData\Local\Temp\www.internationalscholarsjournals.org


 
 
 

 

consumption in Uganda’s Nabongo area is 58 kg (David, 
1999) . Beans provide about 25% of the total calories and 
up to 45% of protein intake, of the diet of many Ugan-
dans. The crop is also an important source of income in 
Uganda due to the increasing demands both in the dom-
estic and export markets (NARO, 2000). 

It is known that smallholder farmers have adopted 
some of the released varieties from research institutions. 
There is inadequate empirical evidence on the bean grain 
characteristics preferred by consumers. There is also ina-
dequate knowledge about the released cultivars among 
customers, their marketability and geographical distribu-
tion within the region. This study was therefore conducted 
to investigate the legal and institutional constraints to 
Kenya- Uganda cross-border bean marketing. The object-
ives of the study were to identify and assess the legal and 
institutional constraints, which lead to informal bean trade 
in the border districts of Kenya and Uganda. 

 
METHODOLOGY 
 
This study was conducted in Bungoma and Busia districts of west-
ern Kenya and Mbale and Kapchorwa districts of eastern Uganda 
between March and June 2002. The study focused on the factors 
that prohibit traders from entering into or leaving the bean trade in 
order to be able to determine the relative ease of access into bean 
marketing. Primary and secondary data sources were utilized. The 
primary data were obtained in a survey from 106 bean traders using 
structured questionnaires. Besides questionnaires, observation and 
discussions were also used to capture the primary data. A descrip-
tive survey design was adopted to attain the objective of describing 
problems encountered by bean traders in the study area. To achie-
ve this, the informants who included Agricultural Extension Co-ordi-
nators, KEPHIS officials and customs representatives were used in 
Kenya while in Uganda, CIAT Co-ordinators, NARO staff and DAOs 
were the informants. The primary data collected included formal 
export procedures, volumes of beans bought, sold and transported 
across the borders, their prices, number of buyers and sellers (par-
ticipants), sources of supply, distance covered and modes of trans-
port. Secondary data refer to published information mainly from pre-
vious studies on cross-border bean marketing and were only used 
where pertinent historical information was required. The data mainly 
used were qualitative, hence requiring descriptive analysis. Secon-
dary data were obtained from the governments’ publications such 
as Economic Surveys, Statistical Abstracts of Kenya and Uganda 
as well as publications from private institutions. Purposive sampling 
method was used to select the study districts, while systematic ran-
dom sampling procedure was used to select the traders.  

The major wholesale and retail markets in the study area were 
identified and selected. Retail traders and wholesalers were identi-
fied using the volume of beans they handle. In every market the first 
respondent was picked arbitrarily and the next respondent was 
picked by skipping one. Legal constraints were the factors analysed 
to determine the barriers to entry into bean business. Descriptive 
statistics and analytical models (S-C-P) were used to analyse the 
data using Statistical Package for Social Scientists (SPSS) and Mic-
rosoft Excel computer programs. 

 
RESULTS AND DISCUSSION 

Cross-border bean marketing 
 
The trade across the Kenya-Uganda border is composed 

of both formal (recorded) and informal (unrecorded) trade 

  
  

 
 

 

There are four border points from Uganda to Ken-ya. 
These are Suam in Kapchorwa, Lwakhakha in Mbale, 
Malaba in Tororo and Busia in Busia districts of Kenya 
and Uganda. Informal trade thrives at virtually all the 
above border points despite the existence of physical 
barriers. This informal trade is particularly significant at 
Suam, Malaba and Busia border points. The major play-
ers in informal trade are women and the youth, who either 
carry their commodities on bicycles or cross on foot. 
Commodities are carried in small quantities (sometimes 
as low as 5 kg). However, since this is done repeatedly, 
the quantities exported end up being significant. It is imp-
ortant to note that informal trade is not only conducted 
using side-roads. In fact, a significant outflow of commo-
dities through the informal channel was observed during 
the survey to be occurring at the official crossing points. 
One key informer was heard commenting that since no 
tax is levied on exports, there is no urge on the part of the 
Uganda Revenue Authority/Customs officials to record 
such transactions. 
 

 

Participants in cross-border bean trade 

 

Two groups of market participants are involved in cross-
border bean marketing. 1. Wholesalers who travel from 
Kenya to Uganda to purchase beans and transport them 
across the four border points. This group of participants 
handled a sizeable volume of the cross -border bean tra-
de. However, a significant amount of it was informal. 2. 
Uganda exporters who included large-scale producers 
and export companies who export their beans mainly 
through Busia, Malaba and Lwakhakha border points. 
The long distance wholesalers are the major participants 
in the informal cross -border trade. This group normally 
travels from Kenya to markets in Uganda such as Mbale, 
Sironko, Kapchorwa, Tororo and even as far as Kasese 
to purchase beans and transport them to border points 
using hired lorries. Once they reach the border towns, 
beans are carried across the border by different modes of 
transport, depending on convenience and volume. At Bu-
sia border point human labour is used to transport across 
the border through footpaths to the stores on the Kenyan 
side. Others use bicycles and pick- ups. On Malaba and 
Lwakhakha borders, head-load and bicycles are used to 
cross to Kenyan side. Kenyan wholesalers, who team up 
in a group to pay for one store, rent these stores. These 
bean stocks are accumulated to a reasonable volume in 
these stores for a week or more.  

Lorries are hired by these long distance wholesalers 
who transport them to various destinations in Kenyan 
markets such as Kitale, Nakuru, Nairobi, Machakos, Kitui 
and Mombasa. The Uganda exporters purchase their 
bean stocks from Kampala, Mbale, Kapchorwa, Kasese, 
Kabale and Kisoro and transport them across the borders 
of Lwakhakha, Busia and Malaba through formal export 
channels. 



 
 
 

 
Table 1. Cross-border bean exports and value to Kenya: 1990-1998. 

 

Year Formal (Mt) % of total Value (US$Mil.) Informal (Mt) % of total Total (Mt) 

1990 2,132 24.4 0.97 6,593 75.6 8,725 

1991 2,855 13.6 0.84 18,165 86.4 21,022 

1992 1,723 4.7 0.52 34,955 95.3 36,678 

1993 767 8.6 0.2 8,112 91.4 8,879 

1994 3,343 23.9 1.17 10,659 76.1 14,002 

1995 678 2.7 0.5 4,663 87.3 5,341 

1996 2,442 17.7 - 11,372 82.3 13,314 

1997 2,592 19.6 - 10,658 80.4 13,250 

1998 2,743 21.6 - 9,944 78.4 12,687 
 

Source: Agribusiness Development Center (ADC)/ IDEA project, 2000. 
 

 
Table 2. Estimated 1999 cross- border bean exports to 

Kenya. 
 

 Volume of Beans (Metric tones) 

Border point  1999  

 Formal Informal Total 

Lwakhakha - 801 801 

Malaba 2,245 3,570 5,815 

Busia 8,132 7,150 15,282 

Suam - - - 
 

Source: (Agribusiness Development Center (ADC)/ IDEA 

project, 2000 

 
 

 

onions. (ii). Import duty of 3.5% of value of produce. For 
countries which are members of Common Market for 
Eastern and Southern Africa (COMESA) pay 90% less 
than the rate applied to import goods from non –COM-
ESA countries. Most traders interviewed commented that 
HCDA levy discourages formal cross-border bean trade, 
because beans attract this levy. This scenario leads most 
of the bean traders evading formal export procedures and 
customs duty. However, in an interview with one KEPHIS 
official at the end of the survey it was established that the 
levies by HCDA have since been withdrawn. 

 

 

 

Formal export procedures 
 
The Ministry of Agriculture Animal Industry and Fisheries 
(MAAIF), Kampala, Uganda is a government body that is 
responsible for controlling the importation and exportation 
of plant materials. For any trader to export beans and 
other plant materials from Uganda into Kenya, the follow-
ing documents are required by MAAIF: 1. Plant import 
permit from the importing country (Kenya). 2. Phytosani-
tary certificate charged Ush 2,000 or Ksh 85 per consign-
ment. 3. Letter of request for exportation, indicating the 
importer, the exporter and their addresses. The Kenya 
plant Health Inspectorate Service (KEPHIS) is the Kenya 
government agency that regulates plant imports and exp-
orts. For bean imports to be formally allowed into Kenya 
or out of it, KEPHIS requires a phytosanitary certificate to 
confirm that the consignment has been inspected in 
Uganda and is free of pests and diseases. Other costs 
that apply are as follows: Import Duty Fee (IDF) paid to 
customs at Ksh 5,000 per consignment, depending on 
weight, for example up to 20 tons the charge is Ksh 5,  
0. Up to 50 kg, the charge is Ksh10-20. All these pay-
ments go to the Kenya Revenue Authority (KRA). At the 
time of the survey, the Kenya customs department was 
administering two levies; (i). Horticultural Development 
Authority (HCDA) levy, at the rate of Ksh1 per kg of pro-
duct. This is charged on beans, oranges, bananas and 

 
Volume of cross-border bean trade 
 
The formal bean trade across the border of Uganda and 
Kenya is small. According to a recent study by Ackello-
Ogutu (1997), the annual average of the formal trade 
figures between Kenya and Uganda from 1983 to 1993 
period may account for less than 12% of the total trade 
between the two countries, while informal trade con-
stituted about 4.5% of Kenya’s national production figures 
for beans. Table 1 shows trends of Cross-border formal 
and informal bean exports to Kenya over the period 1990-
1998.  

Analysis of bean exports reveals that formal bean exp-
orts from Uganda to Kenya increased from 2,132 metric 
tonnes in 1990 to 2,855 metric tonnes in 1991, and then 
fluctuated between 1,723 metric tonnes in 1992 to 678 
metric tonnes in 1995, while informal bean exports incr-
eased from 1990 to 1992, decreased in 1993 and fluctua-
ted again up to 1995 (Table 1). During the time when 
formal exports were increasing from 1996 to 1998, infor-
mal bean exports were declining. The explanation to this 
scenario is that the formal bean exports increase was 
attributed to improved trade relations and the strengthen-
ing of the East African Common market at the time and 
the lifting of export ban to Kenya. It was noted that nearly 
22,000 metric tons of beans were exported through the 
three border points. Busia was ranked first among the 
three border points in bean exports followed by Malaba 
then Lwakhakha. Table 2 summarizes the volumes of 



  
 
 

 

Table 3. Estimated annual cross-border bean exports to Kenya. 
 

Border point Range (Metric tonnes/annum) Informal Trade as % of Total 

Lwakhakha 170-800 100 

Malaba 4000-6000 41-61 

Busia 6500-15000 45-47 
 

Source: Agribusiness Development Center (ADC)/ IDEA Project, 2000. 
 

 
Table 4. Cross- border bean exports to Kenya and value: 2000. 

 

   Suam  Busia Malaba Lwakhakha Total 

Formal volume (Mt)  239 17,668  107  702  18,716  

Formal value (US$ Mil.)  0.047 4.03  0.035  0.172  4.284  

Informal volume (Mt)  378 11,640  1,733  1,322  15,073  

Informal value US$ Mil.)  0.036 2.20  0.535  0.313  3.08  

Total volume (Mt)  617 29,308  1,840  2,024  33,789  

Total value (US$ Mil.)  0.083 6.23  0.57  0.485  7.37  

 Source: Foodnet, 2002.           

 Table 5. Cross-border bean exports to Kenya and value: 2001     
             

   Suam  Busia  Malaba  Lwakhakha  Total  

 Formal volume (Mt) 0  2,868  261  323  3,452  

 Formal value (US$ Mil.) 0  0.841  0.055  0.086  0.982  

 Informal volume (Mt) 0  4,360  4,035  416  8,811  

 Informal value (US$Mil.) 0  1.191  0.88  0.106  2.177  

 Total volume (Mt) 0  7,228  4,296  739  12,263  

 Total value (US$ Mil.) 0  2.032  0.935  0.192  3.159  
 

Source: Foodnet, 2002. 
 

 

formal and informal bean exports that crossed from 
Uganda to Kenya in 1999.  

It is also worth noting that Lwakhakha border point is a 
well-established border point, though the road to this exit 
is poor. The situation worsens in the rainy season. The 
poor road infrastructure renders the border point to have 
low cargo traffic. The border point also has a river barrier 
whose water level is most of the time high rendering the 
route impassable during heavy rains. Malaba is a busy 
border point and handles a sizeable amount of exports to 
Kenya. It has a river barrier but despite this, informal 
trade at this point is significant. Busia border point is 
perhaps the busiest as it handles big volumes of exports 
to Kenya. The border has no physical barrier and only the 
forms of barrier are the local councils (LCs) who have 
instituted local taxes at the unofficial crossing points on 
Uganda side. Table 3 shows the annual export volumes 
at the three border points.  

In depth analysis of bean volume indicates that the 
informal volume of beans exported from Uganda to 
Kenya in 2000 was more than the formal volume in three 
border points, Suam, Malaba and Lwakhakha (Table 4 
and Table 5), while in the year 2001, informal volume of 

 
 

 

beans exported was more than the formal volume in all 
the four border points. This was observed to be the case 
during the survey in the study area as evidenced by the 
high traffic of mostly women and the youth who were 
seen carrying small quantities of bean stocks crossing 
several times in a day. However, the total formal volume 
was more than the informal volume in the year 2000. The 
informal trade thrives due in part to the physical nature of 
the border points, reluctance on the part of customs 
officials to record what they call “small” transactions, len-
gthy documentation procedures and the reluctance on the 
part of the traders to avoid paying what they term as high 
“clearance fees”. It was noted that some of the bor-der 
points did not have up-to-date data on exports. This was 
observed particularly in Suam border point. The esti-
mates of the informal volume of cross- border bean trade 
reported here suggest that more than half of this trade 
was not registered, implying a serious omission in the 
calculation of both countries Gross Domestic product 
(GDP). Therefore, there exists a big potential in cross-
border bean trade between Kenya and Uganda, and tra-
de liberalization through regional co-operation initiatives 
will enhance the realization of this potential. 



 
 
 

 

Legal and institutional constraints 
 
Entry barriers prohibit potential competitors in various 
ways. In both Kenya and Uganda, though beans are mar-
keted under a free (liberalized) market system with mini-
mum government intervention, a number of constraints 
still exist. The complex methods of certification and sta-
mp fees are one of main reasons for the presence of bri-
bery at border crossings. This was evident at Busia, and 
Malaba border points. Institutional restrictions in form of 
lengthy documentation procedures involved in the issuan-
ce of licenses coupled with high clearance fees forces 
many traders to resort to informal crossing points (Mauyo 
et al., 2007). This was cited by traders as one of the maj-
or causes of informal trade. A number of traders who 
were interviewed complained of harassment by public 
officials and customs authorities. In relation to the above, 
local councils particularly in Busia border point have insti-
tuted local taxes at the unofficial crossing points and as a 
result, traders end up incurring more costs that were not 
planned for. Rent seeking practices among Public offi-
cials at the major border crossing points and cumber-
some import/export procedures encourage both large and 
small traders to pass their beans through undesignated 
routes. This leads to loss of income on the part of the 
importing and exporting countries as tax is not paid at 
entry points by most traders since most of them are not 
captured. This forces traders to engage in bribes to police 
officers who may be found on such routes. High trans-
portation costs due to poor roads increase the cost of 
business and were cited by most traders as a barrier to 
entry in the bean business. Other constraints that were 
considered as barriers by most traders are: lack of wor-
king capital and credit facilities, instability of foreign ex-
change rates which makes them not to plan well for their 
business and lack of storage facilities at the border points 
which not only affects quality of products but also encou-
rages trade in “small” quantities. This therefore leads to 
reduction in the two governments’ revenue and volume of 
trade. We can therefore conclude that, legal and institu-
tional constraints are barriers to entry in the bean trade in 
the study area, which have locked out many traders who 
would have ventured into the business. 
 

Conclusions 
 
Lengthy documentation procedures, high clearance fees, 
harassment by public officials and customs authorities 
are legal and institutional constraints, which have led to 
informal bean trade on Kenya-Uganda border. Instability 
of foreign exchange rates, high transportation costs due 
to poor roads and lack of storage facilities at border poi-
nts increase business costs. However, there is potential 
in cross-border bean trade between Kenya and Uganda, 
which could be exploited through regional co-operation. 
 
Recommendations 
 
The following recommendations are suggested based on 

 
 
 
 

 

the findings of this study: i). There is need to provide the 
necessary road infrastructure in the bean production 
districts of the two countries including the maintenance of 
all weather roads to border exit points. This will improve 
the transport efficiency by providing effective competition 
and all farmers and traders from an efficient rural trans-
port system will derive gains in reduced transport costs. 
ii). The two governments (Uganda and Kenya) through 
the local governments’ authorities should construct cheap 
market storage facilities which are appropriately located 
within the open air markets in order to reduce the trader’s 
handling and other marketing costs. This will also gene-
rate extra revenues in form of stall hiring charges. iii). 
Focus should be directed to elimination of trade obstacles 
such as non-tariff and institutional barriers, which increa-
se transaction costs for importers and exporters. This can 
be achieved through strengthening of regional coopera-
tion 

 

AKNOWLEDGEMENTS 
 
The authors are grateful to the traders from the two coun-
tries who volunteered their information and the customs 
and KEPHIS officials for accepting to be interviewed. We 
are also grateful to ECABREN-CIAT for funding this 
study. 
 
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