This paper examines the opportunities and challenges facing Micro, Small, and Medium Enterprises (MSMEs) engaged in informal cross-border trade (ICBT) at three strategic border locations: Cyanika (Rwanda–Uganda), Mpondwe (DRC–Uganda), and Vvura (DRC–Uganda).

Methodology:

Using primary data from stakeholder consultations and secondary data from official trade statistics, we analyze trade flows, operating models, and the unique constraints confronting women traders, who constitute over 70% of the informal trading population.

Key findings on trade flows:

The study reveals that Mpondwe and Vvura collectively account for 33.2% of Uganda’s informal export revenue ($188.6 million in 2023), with fish, agricultural products, and manufactured goods dominating trade flows.

Progress and persistent challenges:

While the Simplified Trade Regime (STR) and One-Stop Border Posts (OSBPs) have improved formalisation rates, significant challenges persist, including customs compliance burdens, inadequate infrastructure, regulatory inconsistencies, and gender-based vulnerabilities.

Gravity model estimates:

Our empirical analysis employs a structural gravity model to estimate trade facilitation effects, demonstrating that behind-the-border costs reduce trade volumes by 23–35%.

Gender-disaggregated findings:

We find that women traders face disproportionate barriers, including sexual harassment, limited access to market information, and inadequate childcare facilities.

Policy recommendations:

The paper concludes with targeted policy recommendations for gender-responsive trade facilitation, including mobile testing laboratories, digital trade platforms, and strengthened cross-border trader associations.