City Twinning Key to East Africa Integration

802 views Published on 20th March 2012

The need for regional integration is premised on the fact that integrating small economies will leverage their collective bargaining power in international fora, enhance their effective participation in the international economic systems and provide a platform for prudent management f trans-boundary resources.

Regional integration theorists will argue that integration offers an option for economies to face many of the phenomena confronting them. On one hand, an integrated region offers a larger and consistent market for local products while on the other, tackling the crisis in a regional approach offers better results through amassing efforts and exchanging ideas on the responsive strategies.

The integration process in the EAC is guided by the Treaty that came into force in 2000. The community offers an opportunity for an enlarged combined market of 140 Million people with GDP of US$74billion. The treaty provides for a clear and structured path involving four stages of integration of the Custom Union, Common Market; Monetary Union and ultimately Political federation. The progress made in this path can be summarized as follows:

Stage

Status/year of establishment

     Provision

Customs Union

   2005-2010

Elimination of internal tariffs

Application of CET

 

Common Market

   2010 

Freedom for movement of       people/workers
Freedom for movement of services
Freedom for movement of capital
Right of establishment
Right of residence

Monetary Union

    Target- 2012 

 Common Currency


Common monetary policy/institution

Political Federation

    Ultimate

Common governance structure

With the establishment of the Customs Union in 2005 and Common Market in 2010, a number of achievements have been realized and more opportunities are available.

On the movement of goods, the region has experienced upward trend over the period.  For example, Kenya exports to EASC rose from KSHS.73billion in 2005 to KSH. 101.3 billion by the end of 2010 representing an average growth of 36.7%. The community accounted for over 25% of the total Kenya exports in 2010 overtaking the EU at 24% which has traditionally been the main export destination. A notable advantage of the EAC that the exports to this market are mainly manufactured products which involve local value addition. This has a chain of impacts including employment and wealth creation. In the same vein, EAC offers cheaper and proximate source of inputs in our economy. With the discovery of oil and gas resources in the EAC Partner States, for example, the Kenyan economy can definitely benefit by accessing the resources next door.

The Partner States have also been opening up movement of labor and services with Kenya and Rwanda already taking lead on this area by allowing free movement of workers bilaterally. The other Partner States are also opening up movement of workers and services gradually but all must be opened by 2015.

On investment, there has been encouraging movement of capital across the borders in all directions. For example some of the Kenyan companies which have expanded investments across the borders include KCB, Nakumatt, Uchumi and Nation Media Group. Likewise investors from the other Partner States have located their investments to Kenya.

In addition, the Community has undertaken to invest more on infrasture with work going on in a number of regional road projects such as Arusha-Namanga-Athi River, Arusha-Taveta-Voi and Malindi- Lunga Lunga- Tanga roads. With the envisaged economic growth,demand for energy will surge. EAC has therefore embarked on systems inter-connection to facilitate sharing of available energy resources.

On tourism, the Partner States have agreed to market the region as a single tourism destination as well as harmonizing classification of hotels.
EAC has also been implementing programs on sustainable utilization of resources, especially within the Lake Victoria basin ecosystem under the coordination of the Lake Victoria Basin Commission. In that regard the Community in collaboration with development partners is currently running an environment programme (LVEMPII) worth about KSH. 3billion with various project components. Counties within the basin that have a stake in the resource are meant to benefit from this programme.

I have briefly highlighted the progress made in selected key areas of integration under the EAC. At this juncture, I will focus on the access of the benefits under the twinning of cities in the region.

The community offers opportunities in a number of areas. First, is the case of exports into an enlarged market under the Customs Union which provides for free movement of locally produced goods. Already dairy farmers are accessing this market for the milk products.

Second, is the trade in services under the Common Market in the following areas, among others:

- Distribution Services
- Education services
- Financial services
- Tourism and travel related services
- Transport services
- Professional and business services;
- Information and communication  technology;

Third, is on tourism where our cities can take advantage of joint tourism promotion to package and sell their tourist attraction products. Already some cities such as Nakuru have started selling themselves though the media campaign.

Fourth, is on infrastructure projects like roads which have been prioritized as EAC projects under the multinational window and thus are already accessing funding. These projects are indeed opening up the cities in which they pass through.

For optimal access to the opportunities offered by the community, a number of areas need to be addressed including, among others (1) Harmonization of policies and measures that impact on trade. (2) Development of infrastructure especially roads, railways, ICT and petroleum pipelines; (3) promotion of policies that promote value addition in various production processes across all sectors; the support for the diversification of the economic base of the region from the primary goods intermediate goods and eventually finished goods, with the development of a competitive services sector to complement the production sectors. These are areas that this forum needs to be at the fore front in championing.

Before I conclude, it is important to underscore the potential role of the Eastern Africa Sister Cities (EASC) in the process of embracing regional integration and ensuring access of such benefits by the citizens. Cities and urban areas are indeed centres development across the whole EAC region. This forum which seeks to promote people to people partnership is therefore an important vehicle for driving an all-inclusive approach to a development in our region.  There is doubt that EASC has the capacity and suitability for playing this role.

The dynamism of the globalized economic system requires the forum to be on the lookout in order to observe the trends and thus unravel the necessary plans that would enable the EAC cities access benefits of the new world’s economic order.

I therefore encourage EASC to continue and even intensify plying the role of advising on how the EAC cities can to achieve envisaged growth projection under regional integration framework.

By Hon.Musa Sirma, EGH,

Minister For East Africa Community During the Eastern Africa Sister Cities Launch Ceremony.


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