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VOL.4 February 2012
Seeking a United Front
The East African Community looks ahead to currency and political integration
by Aggrey Mutambo

Optimistic future

Would this progress endure? Backers of this five-nation integration say it would eliminate some of the limitations individual countries have had, trying to go it alone.

According to James Shikwati, a Kenyan economist and a director of consultancy from the Inter Region Economic Network, the proposals in the EAC framework, if implemented, would increase the opportunities for investors within the bloc, and might just be a solution to their political ills.

Shikwati argued that besides expanding the market, in countries like Kenya and Uganda where tribalism is more pronounced, the union would create a positive distraction and instead focus on the benefits the federation would bring.

"In countries where the tribal and ethnic card is played out in terms of accessing jobs and other national favors, a united East Africa Federation will make tribalism irrelevant because the countries would become tribes," he said.

Others think that the political integration and single currency go hand in hand. "If successfully implemented," said Macharia Munene, Professor of International Relations at the United States International University-Kenya. "A single currency will help to mould common thinking among the peoples of East Africa which will make it easier to accept common political practices and to evolve an acceptable governing ideology."

 

Trade doubled

The East African Community Facts and Figures Report 2011 shows that of the more than 133.1 million people in the bloc, more than half are unemployed youth. Since the launch of the EAC, member countries have since doubled the volume of trade between them. Kenya for instance more than doubled its exports to Uganda from $305.5 million in 2000 to $657.1 million in 2010, a factor attributed to an expanded market.

The EAC registered an average overall real GDP growth rate of 1.8 percent in 2010 with the total GDP (at current prices) for the region amounting to $79.2 million in 2010 compared to $73.8 million in 2009, the report asserts.

The dominant sector in all the partner states in 2009 was agriculture, followed by wholesale and retail trade and manufacturing. The transport and communication sub-sector has consistently been improving its contribution to GDP.

Skeptics

Despite these encouraging statistics, some ordinary people are reluctant to embrace the EAC.

"I am hostile to the idea of integration because the manner in which it's being organized is objectionable," said Elsie Eyakuze, a Tanzanian freelance journalist and businesswoman.

"All the signs of an inappropriately grandiose project are there: the impatience, the undemocratic nature, the technocratic bias, the refusal to consider alternatives; I smell a failure waiting to happen," she told ChinAfrica.

The concern for her is that the EAC seems to ignore lessons drawn from the Euro zone, where countries that abandoned their currencies in a hurry are now regretting it.

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