EAC moves to protect small industries from regional competition

The East African Community (EAC) will critically focus on protecting its infant industries against the already blossoming industrial sector of the Southern African economic blocs.This was noted yesterday during a two-day workshop that attracted close to 150 officials to assess the impact of the proposed establishment of a tripartite free trade area between EAC, SADC and COMESA.SADC and COMESA are home to Africa’s largest two economies, South Africa, with a gross domestic product of US$524 billion, and Egypt with GDP of US$497.8 billion respectively. These dwarf East Africa’s largest economy, Kenya, which conducts a GPD of US66 billion (2010 statistics).“Everything is still under negotiations and as East Africa; we shall negotiate for a level playing field, looking at market integration, industrial development and infrastructural development as pillars of the desired free trade area,” George William Kayonga, the Permanent Secretary in Rwanda’s Ministry of East African Community said.“The three bodies combined are umbrellas for 26 countries, which will surely provide economic remunerations to East Africa in a free trade area. EAC decided to negotiate as a bloc so that our interests are understood without overriding one another.”A draft report on the assessment noted that although overall trade amongst EAC countries was going well, some partner states “hold on too long” to their internal policies, thus threatening the formation of tripartite free trade area.“There is no institutional framework in the regional economic communities to handle a fully-fledged customs union or to implement the protocol. Thus, implementation is slow and there is mistrust among partner states who do not understand how the revenues will be collected and distributed,” the report states.Professor Gavin Maarsdop, head of the team that prepared the report emphasized the need for commitment to the tripartite treaty ahead of internal policies.“Overlapping membership of regional communities that are at different levels of integration has been a major obstacle because of different rules of origin which have made implementation of a tripartite free trade area difficult,” Maarsdop said.Despite that, the Tripartite Free Trade Area was recognized by the Heads of States as a major source of economic growth to the member countries and in 2010, they commissioned a forum to prepare the negotiations.In June this year, they agreed on a framework under which negotiations will be guided to ensure that the free trade area is commissioned as early as 2014.

National

EAC moves to protect small industries from regional competition