DAR ES SALAAM: LAST week in this column, we argued that economic resilience cannot be imported. It must be built at home. That principle applies not only to fuel, fertiliser and finished goods, but just as forcefully to the systems we have already installed to defend our markets — the technologies adopted to stop counterfeiting and smuggling.
For years the right question was simple: do we have a system at all? East Africa has answered it. We adopted digital tax stamps and track-and-trace technology ahead of many peers. That was a serious decision, and the governments behind it deserve credit for acting early against a problem that quietly drains revenue, endangers consumers and punishes honest manufacturers.
But a decision made years ago must now face a harder question. The first generation of policy asked whether the system existed. The second must ask: is it worth what we are paying for it?
Because the bill has arrived. It arrives every year, and not on the government’s desk but on the factory floor. The running cost is carried largely by manufacturers—a per-unit charge on every item, on top of the excise they already pay. In some sectors it now reaches tens of billions of shillings a year. Industry associations say the same thing: we are not against protecting the market, but we are paying twice, and the second payment keeps climbing.
That is the part of the ledger we can see. The harder part is the other side. We know what these systems cost. The honest question is what they have returned.
Here we must be fair. Revenue authorities point to real gains—higher collections after the systems went live. Those numbers are not imaginary. But a rise in collections is not the same as a system that works. Revenue can climb for many reasons at once: higher rates, larger volumes, inflation, a growing formal economy. Before crediting one system with the whole increase, we owe ourselves an honest calculation of how much the technology actually delivered.
And there is a question the official figures rarely answer. If these systems were closing the gap, counterfeiting and smuggling should be shrinking, year after year. Are they? Walk through any market and the answer is uncomfortable.
The fake bottle, the untaxed carton, the smuggled pack have not disappeared; in too many categories they arrive as fast as the genuine product. If we have spent so much and illicit trade has not retreated, the problem is not the ambition. It is the value for money.
This is not an argument against protecting our markets, but for protecting them intelligently. We have reached the stage where “we have a system” is no longer a sufficient answer. The country that built robust public finances did not do it by spending and hoping, but by demanding that every shilling spent return more than a shilling in value – capital allocation efficiency at best, where capital markets shine. That is productivity.
So let me propose a standard—three tests the next generation of protection must pass.
First, the cost must be shared, not dumped. A model that loads the entire burden onto manufacturers is not a national solution; it is a private tax collected for someone else’s benefit. The cost of authentication should be spread so thinly across the chain—producer, importer, and the consumer who gains protection — that no single party feels it.
Second, the right to verify must be returned to the consumer. Until now the consumer has stood outside the checking process, trusting the State to verify on their behalf. That made sense for its time. But we have reached the moment to hand that right back — directly to the people who buy.
This is not only fair; it is the most effective defence we have. A market where consumers can each confirm authenticity is one where counterfeiting and smuggling lose their reason to exist. You cannot sell a fake into a crowd that can instantly see it is fake. Millions of empowered buyers become millions of inspectors — a wall no smuggler can climb.
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But the right only means something if everyone holds it. It must reach the woman at a small village kiosk as surely as the shopper in a city mall. It cannot depend on a smartphone, an app or a network connection that half the country cannot reach. The test is simple: can an ordinary person, anywhere, confirm a product is genuine immediately and intuitively, with nothing but their own eyes and hands?
Third, the system must return more than it costs. If the revenue recovered and the harm prevented do not clearly exceed the money spent, the system has failed, however sophisticated it looks.
These are not radical demands. They are the ordinary discipline of value for money, applied to a sector that has somehow escaped it.
The tsunami taught us that resilience is built, not bought. The same lesson holds here. We have already paid the bill. The only question that matters now is whether we are getting our money’s worth — and whether we have the courage to ask.