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EAC in-depth

The East African Community was re-established in 1999 with the addition of Rwanda and Burundi. The region has a population of 141 Million people and a GDP of 99 Billion USD and average income per capita of 732 USD. The region like much of Sub Saharan Africa has registered impressive growth rates including 6%  in 2011 and has averaged 5 percent growth since 2000 . The value of the regions trade with the rest of the world has doubled to 37 billion USD from 17.5 Billion USD in 2005.

Regional trade increasing

Trade between countries in Africa is typically very low and is constrained by small economies with low levels of diversification, insufficient infrastructure and substantial legal and administrative barriers. The trading profiles of the EAC countries show many similarities. Most of the countries export commodities such as tea, coffee, and minerals, although Kenya, which has the largest economy in the EAC, has achieved greater diversification and also has a strong export industry in horticultural products and some manufacturing.

The main trading partners of EAC countries are the European Union (EU), United Arab Emirates (UAE), India, China and the US but intra-regional trade is increasing. Between 2004 and 2008, trade from EAC Partner States within the EAC has increased by 74%.

Tanzania and Uganda are now in the top 10 of Kenya’s trading partners. A similar pattern is observed in Tanzania with the share of trade going to Kenya steadily increasing since 2005. In 2009, Tanzania’s trade with Kenya accounted for 6.5% of Tanzania’s total exports and 4.7% of total imports, making Kenya its 3rd largest trading partner ahead of South Africa and India. The actual figures for intra-regional trade may also be considerably higher due to informal trade. For example, the East Africa Grains Council estimates that approximately 60% of grain trade in the EAC may be informal. 

The EAC integration process

In East Africa, significant progress has been made on regional integration in recent years. The EAC launched a customs union in 2005 and a common market in 2010.

The EAC customs union has been implemented on a phased-basis up until 2010. Whilst the customs union has been a positive driver in increasing regional trade since 2005, implementation across the EAC partner states is still not complete. Major outstanding areas are the prevalence of non-tariff barriers and the lack of a single point of entry scheme for customs clearance of goods entering the community.

The EAC Common Market Protocol aims to establish free movement of goods, services, labour and capital within the regional market. The goal of the community is to progress from a common market to a monetary union and eventually a political federation.

2011-2016 Strategy

The 4th EAC Development Strategy has several developmental objectives such consolidating the benefits of a fully fledged customs union and full implementation of the Common Market Protocols (e.g. free movement of goods and services, factors of production, etc.) as well as institutional reform within the community’s regional institutions.
The new EAC Development Strategy also includes an emphasis on trade facilitation, transport infrastructure, agriculture and food security, as well as private sector development and investment climate reform. Cutting across all of these areas are issues around gender equality, youth unemployment, governance and environment/climate change.

The EAC is also negotiating with the EU for a full Economic Partnership Agreement, covering trade and development dimensions. Overall, the integration process in East Africa has been particularly positive compared to the rest of Africa. It has been driven forward by a political will in the member countries to improve the business environment in particular for local companies and to protect their regional and national economies from unregulated imports. 

Governance Structure

The governance structure of the EAC is comprised of the following organs

  • The Summit is made up of the Heads of State from the different partner states. Its task is to provide general directions and be the driving force for the development and achievement of objectives for the community.
  • The Council of Ministers is the main decision making organ that is comprised of the Ministers responsible for regional cooperation in the respective partner states.
  • The Coordinating Council consists of the Permanent Secretaries from the partner states responsible for regional integration. This organ is responsible for coordinating the activities of the Sectoral Committees.
  • Sectoral Committees develop, monitor and implement sector specific programmes. The committees are established by the Council of Ministers upon recommendation by the Coordinating Council.
  • East African Court of Justice is tasked with the implementation and interpretation of the laws of the community.
  • East African Legislative Assembly debates and formulates laws for the community. It is the legislative body of the community.
  • The Secretariat is the executive body who is responsible for the day to day operations of the EAC and the overall implementation of the EAC Treaty. It is headed by a Secretary General and 3 deputy secretary generals.

More information on the integration process, development strategy, and the governance structure is available at the webpage of the EAC.