From left: Somalia's President Hassan Sheikh Mohamud, Tanzania's President Samia Suluhu Hassan, Uganda’s President Yoweri Museveni and Kenya’s President William Ruto at the Arusha International Conference Centre on November 29, 2024.
The incoming chairperson of the East African Community (EAC) has his/her job cut out, coming at a time when the bloc is grappling with multiple challenges even as it continues to expand geographically.
Funding hitches, political spats, trade fights and non-tariff barriers (NTBs) have characterised the bloc’s past year under the leadership of South Sudan President Salva Kiir. Kiir has handed over and the new chair will have a full tray.
The past year has seen some unprecedented developments in the region, marking the first time a secretary-general was removed from office, and ushering in the first-ever woman secretariat boss.
Kenya’s Peter Mathuki was abruptly recalled by the government in March this year and deployed as an ambassador to Russia, in the middle of a storm at the region’s parliament over expenditure queries.
Kenya replaced him with Veronica Nduva, who has to finish the projects her predecessor began and chart a new path for the rapidly expanding bloc into the next decade.
The change of guard at the Summit level has not been smooth, with the Democratic Republic of Congo (DRC) slated as the next in the hot seat. Some partner states were said to prefer one of the original three members to steer the ship through the current choppy waters.
The tensions between Kinshasa and Kigali over the fighting in eastern Congo poses challenges to a Felix Tshisekedi chairmanship. After the DRC, Somalia, which only joined the EAC last year, is next in line and thereafter Tanzania.
The EAC is celebrating 25 years of progress since its revival under the overarching theme, “Promoting Trade, Sustainable Development and Peace and Security for Improved Livelihoods.”
While trade has grown and the bloc touted as the most integrated of the regional economic communities, disputes continue to sprout between partners slowing the integration process.
The bloc continues to deal with a poor remittance culture among members, insecurity and border closures, persistent non-tariff barriers, failure to fully implement the EAC Secretariat and its organs’ decisions, and differences between heads of state over security issues.
Kenya, Uganda, Rwanda, and Tanzania have been funding the bloc, and DRC has added to the list of the full funders of the 2024/25 fiscal year budget.
Now, the new chairperson will have to ensure continued implementation of the Customs Union and Common Market and progress towards a Monetary Union and Political Federation.
Uganda’s First Deputy Prime Minister and Minister for East African Community Affairs Rebecca Alitwala Kadaga is pessimistic about the future, citing the emerging NTBs at the border points.
She dismissed talks on the political federation as empty, until all partners commit to the process. She says a common currency would help resolve some of the trading bottlenecks.
“For a common currency we need to have common criteria. Now we are eight and maybe tomorrow we will be 10. So, when will we have common criteria? I’m still of the view that we should follow what the European Union did: Issue a common currency, then trade alongside our national currencies after we are done, and, progressively, those who want to use the common currency can freeze their own.”
Under the Monetary Union, whose establishment protocol was signed in 2013, the EAC has laid the groundwork for a unified monetary landscape with a single currency as the eventual target.
Progressive steps have been made towards macro-economic convergence, the ongoing establishment of anchor institutions namely -- the East African Monetary Institute, the East African Statistics Bureau, the East African Surveillance, Compliance and Enforcement Commission; and the East African Financial Services Commission, and the legal framework. But the secretariat’s Technical Team on Monetary Affairs pushed the implementation of the Monetary Union from 2024 to 2031.
Amanya Mushenga, a former secretary-general, criticised the decision to push the implementation of both the single currency to 2031 and cast doubt on whether the political federation will ever be implemented as originally envisaged.
“There was the (Amos) Wako commission that was sponsored by the EAC Heads of State. They recommended that the process be funded by the partner states. They also recommended that we have the political federation by 2013. Now, I’ am being told we have moved from political federation to political confederation. Where did this come from?"
“Once the decisions of the summit are arrived upon, the secretariat should be empowered to implement the decisions. Partner states should sensitise their citizens to understand the value of integration,” Mr Mushenga said.
Ms Kadaga, who spoke on behalf of the Council of Ministers, said: “There is no commitment to East African integration. When we come here (in Arusha) it has become fashionable to ‘belong’ to the EAC. But the ‘fashion’ ends when we go back home. They (partner states) resort to their own business, their plans, projects and wait to meet again invited to the meeting.”
“I have attended a number of meetings and summits where agreements are made...the Community is excited but as soon as they go back to their countries, it's business as usual. Meanwhile, our traders are losing money crossing more than three borders.”
But Francis Muthaura, another former secretary-general, said that despite the setbacks, the EAC was integrating well.
“We started with three partner states. Today, we are eight. That is a good sign that the EAC is integrating well,” Mr Muthaura said.
The Customs Union, established in 2005, and the Common Market adopted in 2010, have been instrumental in advancing regional integration and trade facilitation within the region.
But President Kiir’s successor will also have to deal with growing impatience among the business community, over the failure to implement fully the single customs territory, eliminate NTBs under open up the skies, and allow freer movement of goods and people under the Common Market.
Kenneth Bagamuhunda, former EAC Customs and Trade boss, noted the essence of free movement of persons to facilitate trade.
“If you look at the figures and trade reports, when the Customs Union started, the value of intra-regional trade flows was about $1.9 billion and it has progressively gone up. But the average performance of intra-EAC trade has been about 14 percent for the past three years. It has been stuck,” he said.
Under the Common Market, the progressive achievements in the five freedoms and the two rights -- free movement of goods, persons, labour, services and capital; and the rights of establishment and residence -- have been pivotal in creating a more integrated regional economy.
The progressive removal of NTBs and the mutual recognition of professional qualifications have enhanced labour mobility and investment opportunities across the region has been too slow.
Denis Karera, vice-chairperson of the East African Business Council, cited the European example: “When a truck is loaded with goods in Germany, it does not stop till its destination. With 25 years of EAC, we still have trucks being stopped and new charges imposed. Can’t we do the same as the EU?”
President Samia Suluhu Hassan would have to juggle chairing the summit and campaign to retain the presidency in the 2025 election, whose battlelines are being drawn.
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