subsidies were removed (1993) and NCPB interference declined (1995 – 2000) with a cut in central buying/selling and the removal of internal trade restrictions. However, NCPB activity rose steadily over the following decade<sup>69</sup> . The NCPB currently purchases around 10-20 percent of locally produced maize grain, at a fixed price, frequently above that which would exist under a competitive market<sup>70</sup> . Purchased grain is mostly sold on to millers, with some excess sold outside of the country. NCPB actions from 1995 to 2004 are estimated to have increased the price of maize grain by approximately 20 percent on average<sup>**71**</sup> **.** This benefits the small subset of farmers who are net-sellers of maize at the expense of the majority who are net-buyers<sup>72</sup> .

**The high tariffs on maize grain probably do not have a very large effect during times of plentiful regional supply, although at times the government has used barriers to trade to defend higher prices created by NCPB activity.** Tariffs at 25-30 percent during 1995 – 2004 were estimated to increase maize prices by approximately 4 percent in Nairobi<sup>73</sup> , but apparently informal (illegal) imports from within the region were rampant at the time. Currently the EAC-CET of 50 percent on maize generally means that no imports from outside the EAC/COMESA cross the border, except during exceptional circumstances when the tariff is typically waived<sup>74</sup> . However, free trade with lower cost producers in the EAC/COMESA typically covers Kenya’s maize deficit and disciplines prices. Regional maize prices are quite closely integrated, with maize entering Kenya tariff free from within the EAC (Uganda and Tanzania – often informally<sup>75</sup> ) and other COMESA trade partners in the region (Zambia and Malawi). Integration with Tanzania is considerably weaker than that with Uganda, in part due to the role of export bans that have been instituted by Tanzania upon occasion<sup>76</sup> .  Kenyan prices remain somewhat above Ugandan prices generally – trade costs between Kampala and Nairobi prevent a single price from holding across the region and upon occasion Kenya has even impeded regional trade to keep domestic prices artificially high.<sup>77</sup> Various divergences between Kampala and Nairobi wholesale prices illustrated in Figure 9 may be due in part to this.

> 69 D’Hotel et al (2012).  Previous share of marketed maize purchased by the NCPB estimated at 50-70 percent; with the NCPB also exercising other controls on the market for maize (Jayne et al, 2008).

> 70 See Ariga et al (2010), FAS (2013), d’Hotel et al (2012).

> 71 Estimated by Jayne et al (2008) using a reduced form vector autoregressive model.  High maize grain prices may have benefitted some of the poor who grow maize, but most farmers are net maize buyers, with the majority produced by a very small portion of (mostly larger and wealthier) producers.

> 72 Jayne et al (2008)

> 73 Jayne et al (2005)

> 74 Jayne et al (2005), Nyoro et al (2004), Jayne et al (2008), Jayne and Tschirley (2009).

> 75 There are not tariffs applied between these nations, so informal imports are a not a problem in terms of compliance.  However, it does mean that we must approach the import data with caution, since the formal doubtless underestimate total flows of trade.

> 76 See World Bank (2009)

> 77 See World Bank (2009)

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