OWN VIEW
Yes, there was a discouraging wrangle in the East African Legislative
Assembly (Assembly) and yes, al-Shabaab attacks again raised concerns
over Kenya's as well as the wider East African Community's security.
But the Community's overall 2014 performance had some positives whose
end product impacts on the future of the five-member regional bloc.
The past 12 months saw no violent inter-state conflict and, in a way,
the EAC is open for business in 2015. Minus al-Shabaab's terror in
Kenya, the relative peace and stability remains critical in attracting
investments to the region.
What's more, the recent respite in the Legislative arm of the
Community also puts east Africans' minds at ease as EALA is now expected
to concentrate and deliver on its legislative responsibilities.
So important was the call by new Speaker, Daniel Kidega, when, after
taking charge, vowed to bring unity in a house previously dented by
members' disapproval of his predecessor.
The extended wrangle over Margaret Zziwa's alleged abuse of office
had threatened to erode east Africans' trust in the House. With new
trusted and trusting EALA leadership, hopefully, 2015 will bode well for
the region.
The positive and constant hustle and a bustle by the pace setters of
the Northern Corridor - Kenya, Rwanda and Uganda - continued to
accelerate integration, boost trade, and enhance security.
The trio's initiatives were a beacon of hope, and a sign of what the
future probably holds. Among others, looking to cap off 2014 with an
'unforgettable flash,' the leaders of Kenya, Rwanda, Uganda and South
Sudan, during December's 8th northern corridor integration projects
summit, signed an MOU on management of northern corridor air space,
among others.
The deal will deliver in the development of the infrastructure for
transmission, power trade, and significantly reduce the region's cost of
air travel by 40 percent.
The leaders also directed their ministers to expedite ratification of the Standard Gauge Railway (SGR) protocol.
The SGR, despite small start-up hitches here and there, as common
with nearly all gigantic projects, will in future supplement the bloc's
road transport and increase efficiency especially by providing
landlocked economies (Uganda, Rwanda, Burundi) a better and faster
access to Kenya's maritime port of Mombasa.
With an envisaged high design standard, the $3.6 billion double-track
SGR (1,435mm), 1,890 km from Mombasa to Kigali line is expected to
transform transport logistics in the region, stimulate economic
development and benefit all east Africans.
In February, the EAC issued regulations to enhance the
operationalization of the EAC standardization, quality assurance,
metrology and testing Act (SQMT), to facilitate regional trade. The
regulations, among others, will provide consumer confidence of products
traded in the region.
That same month, a new tool, a Scorecard, to assess progress toward
developing the EAC Common Market was launched. It measures Partner
States' compliance to the free movement of capital, services and goods.
At its launch in Arusha, EAC Secretary General, Amb. Sezibera said:
"The scorecard is not about pointing fingers, or apportioning blame. It
is about identifying areas where we are doing well and strengthening
them".
In 2015 and beyond, the Scorecard will help identify areas where
reforms are required to meet expectations in the bloc's integration
agenda.
It is expected to also foster peer learning and facilitate the
adoption of best practice in the region, thus helping fortify the
regional market, grow the private sector and deliver benefits to
consumers.
Also, tourism officials from Kenya, Tanzania and Uganda, met to mull
over thorny issues that afflicted the sector since 2010. That the
meeting happened was in itself an achievement.
Outstanding among the issues that the ministers haggled over was that
countries were denying entry of tourist vehicles registered in others';
cross border cooperation in wildlife law enforcement; and harassment of
driver guides at border crossings; as well as disparities in fees
charged. Ironing out these issues will impact on the bloc's tourism
sector in 2015 and further.
The urgency and importance of cutting donor dependence was reiterated
in 2014. Of the $117.5 million 2013/2014 budget, EAC countries
contributed $37.2 million and donors, $79.8 million.
In March, Sezibera urged the Summit to adopt the alternative
financing mechanism of 1% of customs revenue as earlier proposed so as
to provide for financial solidarity and equity, key tenets of the
integration process.
Some countries are now mobilizing domestic resources, either through
infrastructure levies, or through setting aside monies from their own
budgets," said Sezibera.
"Secondly, because of good macro-economic management, our countries
are able to borrow from capital markets. Rwanda has issued bonds. Kenya
did the same and Tanzania will do the same".
Furthermore, the March launching of the EAC Payment and Settlement
Systems Integration Project (EAC-PSSIP), an important project in light
of the proposed East African Monetary Union (EAMU), the third stage of
EAC integration, was important.
The US$23 million EAC-PSSIP project aims to enhance convergence and
regional integration of payment and settlement systems; strengthen a
harmonized legislative and regulatory financial sector; and build
capacities in EAC countries.
The project, said Dr. Enos Bukuku, EAC's Deputy Secretary General
(Planning and Infrastructure), is a requirement for the development and
implementation of secure, efficient, reliable and integrated payment and
settlement system to ensure efficient flow of financial transactions
within the Monetary Union.
Collaborating on security
When Kenya, a gateway to most landlocked EAC partner states, hurts
there is no doubt that others too feel the pain. The pain inflicted by
Al-Shabaab militants on Kenya is a threat to Uganda and Rwanda. It was
critical, when in October, Kenya, Rwanda, Uganda - and Ethiopia -
contributed the bulk of a now ready-to-deploy military fighting force of
5,000 troops under the Eastern Africa Standby Force (EASF).
EPAs
The negotiations on Economic Partnership Agreements (EPAs) with the EU that started in 2007 were completed.
It is the first time that the Community negotiated terms of trade with Europe and the deal is better than nothing.
Even though the real benefits to EAC will have to be seen rather than
expected, concluding the deal was significant as it ended the
long-drawn-out and wearisome process of negotiations.
The deal, it is hoped, will eventually provide legal certainty for
businesses and open a long-term perspective for free and unlimited
access to the EU market for products from the EAC.
In November, the East African Trade and Investment Hub, a regional
programme intended to increase food security and ramp up trade and
investment between the US and east Africa was launched.
The Hub, it is hoped, will assist EAC's private sector to engage with
government in finding practical solutions to constraints to trade and
investment, as well as build awareness around opportunities for African
and U.S. firms to increase trade, expand business partnerships, and
invest in east Africa.
On December 5, the International Criminal Court (ICC) Prosecutor
withdrew the case against Kenyan President Uhuru Kenyatta. Despite a
lurking chance the prosecutors may bring back charges, the collapse of
the case was a welcome moment for EAC leaders, and citizens, who all the
time disagreed with the trial.
Bad news
Yes, the bloc largely stood on the weak side during 2014 and,
arguably, apart from the Northern Corridor initiatives whose
achievements will ultimately benefit the whole region, little else was
really exciting.
For once, the ill of corruption remained a nagging burden. EAC
countries generally continued to perform poorly in the fight against
corruption with none surpassing the 50 per cent threshold in the latest
global corruption perception index by Transparency International (TI).
The World Bank's Doing Business 2014 report also paints a damning
picture of the regional business climate, with the exception of Rwanda.
A key obstruction in the regional fight against graft is that
regional anti-corruption agencies held opposing views on whether to give
prosecutorial powers to their respective anti-corruption agencies. The
signing of the EAC Protocol on Preventing and Combating Corruption was
hampered by such differences.
Beyond 2014, to create jobs, the partner states will need to jointly
take further steps to tackle corruption, simplify business regulation
and create a vibrant regional common market, among others.
Frosty relations
It remains unclear how the heart of inter-EAC relations will beat
after Tanzania and Burundi hold their respective presidential elections,
in 2015. But it is clear that regional leaders' relations and
camaraderie matter for the integration agenda to thrive.
Without the leaders' amity, a scenario akin to that which led to the EAC's 1977 collapse would, regrettably, be inevitable.
External shocks
Besides other unpredictable socio-economic external or global shocks,
the wave of violence and instability in the bloc's shaky neighbors,
especially the DR Congo, South Sudan and Somalia, is another cause for
concern in 2015 and afar.
Peace and stability in these neighbors would by the same token imply socio-economic gains for the EAC, and vice-versa.
The two-year old tit-for-tat violence in the world's youngest state
which seceded from Sudan in 2011, for example, did not only claim
thousands of lives, displace thousands others and wreck the nascent oil
economy but also directly hit the economies of Uganda and Kenya, some of
South Sudan's biggest trading partners.
Apart from the effect on cross-border trade, Uganda sent troops to
assist President Salva Kiir against rebels led by his sacked
vice-president, Riek Machar, forcing the country into war spending which
definitely eats into its development budget.
On the other side, since the Operation Linda Nchi began in 2011,
Al-Shabaab vowed retaliation against Kenya. Burundi, which has provided
the second largest contingent to the African Union Mission in Somalia
(AMISOM), has also received threats from the militants.
Somalia's insecurity has not only affected its hope of joining the
EAC. It hampers EAC's economic progress when the bloc is forced to
reinforce security at the expense of entirely focusing and pursuing much
needed economic development.
Analysts say that only deepening security cooperation in eliminating
al-Shabaab and other security threats can deliver an enormous peace
dividend benefiting not only Kenya and Somalia, but also the entire EAC
in 2015 and beyond.
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