Economic and social integration of the East African Community

Project description

Title: Support to East African Market Driven and People Centred Integration (SEAMPEC)
Commissioned by: Federal Ministry for Economic Cooperation and Development (BMZ)
Country: Burundi, Kenya, Rwanda, South Sudan, Tanzania, Uganda
Lead executing agency: Secretariat of the East African Community (EAC); Arusha (Tanzania)
Overall term: 2019 to 2022
 

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Context

The East African Community (EAC) is one of the most ambitious African regional organisations. Among the major challenges facing the EAC are the introduction of the customs union and a common market with a view to increasing added value and cross-border trade within the region – the current priorities in the EAC. The introduction of a common external tariff is an example of the community’s success. 

Nevertheless, trade-related objectives are often influenced by political reality. Implementation of all the obligations involved in a common market has not yet been achieved. Various trade barriers continue to impact the customs union and the common market. As a result, trade within the region has remained static. Although initial agreements have been reached on the liberalisation of regional trade in services and labour mobility, these are largely awaiting implementation.

The 5th EAC Development Strategy defines overarching priorities for regional integration. However, budget constraints at the EAC secretariat and at the responsible ministries in the member countries are hindering skills and staff development, and the rapid implementation of regional agreements and strategies. In many areas, private sector companies and the civil society receive no information on the status regarding integration. In regional terms they are insufficiently organised to help shape the integration process.

Objective

The framework conditions for increasing added value in selected regional economic sectors of the East African Community have improved.

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Approach

The project is intensifying the economic and social integration of the EAC partner countries. To achieve this, it is working in four main areas.

Regional industrial value creation: The project assists in implementing regional agreements in selected sectors of the economy: pharmaceuticals, leather production, avocados, cocoa, coffee, spices, tea and horticultural products. By doing so it improves the framework conditions for increasing industrial value creation. The field of action was awarded to the GFA Consulting Group. The project includes an EU co-financing contribution for the EU/EAC Market Access Upgrade Programme (MARKUP). RIVA and MARKUP are fostering the implementation and harmonisation of existing standards and customs procedures. The priority areas are improving data for new standards, the exchange of information between the institutions and authorities involved, and training and further training measures for the staff concerned. 

Liberalisation of trade in services: The project is improving the conditions for EAC member countries to implement their commitments. It is supporting relevant stakeholders in seven service sectors in developing specific recommendations in order to remove trade barriers. Within the EAC, the project is promoting strategic processes that encourage commitment to make services more liberal in the partner countries. The project also helps the EAC to develop its own position in the negotiations for an African Free Trade Area. 

Public participation: Through the Incubator for Integration and Development in East Africa (IIDEA), the project is supporting small-scale projects that strengthen regional integration and present their benefits to the population in a clear and practical manner. Particular emphasis is placed on benefits for women and young people. In this way, the project is supporting non-state stakeholders in implementing measures to enable people to participate in regional economic integration. New credit facilities are fostering private sector initiatives to promote trade.

Strengthening the EAC Secretariat: The project is developing skills at the EAC Secretariat in order to implement the 5th Development Strategy in the areas of increasing added value, industrial development, innovation and investment. The project is focusing on EAC departments and initiatives that are important in achieving the programme's objectives. Involving the EAC in regional initiatives and in educational opportunities in digital transformation is particularly important. 

The project is one of various programmes and modules to improve the economic and social integration of the EAC. Close cooperation takes place with relevant projects.

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Results

  • The EAC has grown from three to six members. Protocols for a common market and a monetary union have been signed. 
  • The EAC Secretariat’s coordination capacity has improved, as shown by the 5th Development Strategy and integration progress. 
  • The private sector is taking an active role in regional negotiations and processes based on long-standing support.
  • An EAC Action Plan on Trade Facilitation was developed with project support On the basis of the WTO Trade Facilitation Agreement, Its implementation has already facilitated trading in goods. 
  • Negotiations between the member countries were concluded successfully in seven priority areas of trade in services (finance, tourism, communication, transport, business services, education and distribution) in 2018. The project made a significant contribution in this process. 
  • Essential elements of the agreements on the mutual recognition of training and qualification certificates were adopted. Four of these agreements have now been signed (for engineers, accountants, architects and veterinarians). 
  • The growth rate in local pharmaceutical production has increased and now accounts for a market share of 20 per cent. 
  • A quality management system and a new module for the East African Monitoring System have significantly improved steering in the integration process. This has assisted significantly in preparing the fifth EAC development strategy. 
  • IIDEA has initiated a total of 25 projects since 2016. More than 14,000 people have already benefited from them. The IIDEA website reaches more than 27,000 people a month, most of them from East African countries. In a second phase, 16 projects from over 100 proposals from all six EAC countries were submitted as IIDEA projects.

Further information