Poor infrastructure hampers regional growth–experts

International and regional economic experts attending a regional economic integration forum have identified poor infrastructure among the challenges that continue to obstruct the region’s economic growth.

Tuesday, February 28, 2012
L-R: Finance minister John Rwangombwa, IMF deputy managing director Naoyuki Shinohara, Acting Kenyan Minister of Finance, Robinson Githae, and the Rwanda National Bank Governor, Claver Gatetes, share a light moment after the opening of the conference in A

International and regional economic experts attending a regional economic integration forum have identified poor infrastructure among the challenges that continue to obstruct the region’s economic growth.They have argued that unless the problem is addressed as a matter of urgency, the East African Community (EAC) will never achieve its intended goals.Addressing the meeting, the Director of the Centre for the Study of African Economies at Oxford University, Prof. Paul Collier, advised the bloc that in order to economically develop, there was need to push for political commitment and other stakeholders to have adequate infrastructure such as roads, ports and railways to facilitate the business community. "EAC has got a modern economy, therefore, you need a big market within the region; and for the market to grow, you will need good transport infrastructures, like railways, ports and others. If you don’t do that you will be dead in water,” he said. The conference, that has brought together researchers and business leaders, is jointly organised by the EAC, the International Monetary Fund (IMF) and the Canadian International Development Agency (CIDA).Tanzania, Uganda, Burundi and Rwanda recently reached a formal agreement to construct a multi-billion dollar railway network which will also serve South Sudan and tap into the bloc’s growing trade.The project, set to commence in 2014, is expected to take three years and cost US$4.7 billion to complete.It will run alongside the US$3 billion Tanga-Arusha-Musoma-Kampala railway line that is expected to be completed by 2015. The international scholar further noted that the region must also concentrate on utilizing available resources, especially sharing electricity among partner states for the benefit of the citizens as well as facilitating the business community.Prof. Collier, who is also an economic adviser to the World Bank, advised member countries to develop strategies of expanding their cities, saying that he has observed that the region is growing rapidly."You need to develop and expand the cities. There is a problem of traffic congestion in the region and this indicates that the private sector is growing,” he said.IMF Deputy Managing Director, Naoyuki Shinohara, observed that the region has tremendously developed economically adding that what was needed was to ensure all member countries benefit equally. He mentioned that inflation in the region had been reduced compared to last year and direct foreign investments increased. He added that if the member countries continue with the commitment, the bloc would achieve its economic goals.The IMF official further pointed out that Africa is projected to be the fastest growing continent economically, but advised that EAC should focus on using technology to easily spur economic growth."The region has done a lot in economic growth, but the challenge remaining is to ensure that all member countries benefit equally from the integration”, he said.Shinohara further advised partner states to focus on fully implementing agreed on protocols.Rwanda’s Finance Minister John Rwangombwa mentioned that though there were some challenges hindering the integration process, the country had embarked on ensuring smoothening and implementing the protocols by removing barriers to trade."We are all bound to benefit from the integration, and we, like other member countries, are committed to the integration process. So what we need is to commit ourselves as a region, that’s when we shall benefit,” he said.Rwangombwa added that the government was currently embarking on widening means and facilitating local business communities to tap into regional markets by introducing One-Stop Border Posts (OSBP) to facilitate easy movement.Recently Rwanda and Burundi launched an OSBP at the Gasenyi-Nemba border in Bugesera District aimed at reducing barriers to trade between the two countries. Gatuna OSBP was the first to be launched between Uganda and Rwanda.While opening the meeting, EAC Secretary General, Amb. Dr Richard Sezibera, mentioned that member countries have shown interest and determination to of strengthen the integration process."There is determination to achieve these ambitious milestones based on the principles of progressive implementation, transparency, fiscal discipline, equitable development, good governance policies and taking advantage of the economies of scale, which have become the hallmarks of EAC integration”, he saidSezibera further mentioned that the region still faces challenges; he however observed that partner states should fully commit to overcome them for the benefit and development of the bloc."We recognize that we have a big challenge ahead of us.  We are however equally aware and confident that by putting our act together, we can achieve our set objectives within the timeframes that we have provided.With the resources that could be mobilized, right from the grassroots to the national, regional and international levels, there is every certainty that we would achieve our objectives”.