We are full circle regionally, with regards Independence Jubilee celebrations. The revival of the East African Community was one of the milestones marking our Uhuru jubilations.

Introduction

The new Community has a membership of 7 Partner States namely (Source info (https://www.eac.int/)

• Democratic Republic of the Congo
• Republic of Burundi
• Republic of Kenya
• Republic of Rwanda
• Republic of South Sudan
• Republic of Uganda, and
• United Republic of Tanzania

These are from the original three countries of Uganda, Kenya and Tanzania who founded the EAC in 1967 and was later dissolved in 1977. It is now a Common Market, moving towards a Monetary Union and the ultimate goal of a political federation.

In the course of this progress, the EAC has drawn lessons from successful regional economic communities elsewhere, but apparently, inadvertently or otherwise, there seems to have been no effort made to draw lessons from itself: what does the old EAC teach the revived EAC?

The Roots of East African Integration

Prior to its collapse in 1977, the East African Community was one of the oldest and most prosperous Regional Economic Communities (RECs) in the world. Founded in 1967, by the three countries of Kenya, Tanzania and Uganda, it was an achievement of what had earlier failed in the run up to independence.

Britain, the colonial power in charge of the region then, had wanted to create a federation of the three East African states, a move that was opposed by Buganda in Uganda. Tanganyika had been keen on this federation, with its leader, Mwalimu Julius Nyerere, reported ready to delay the independence of Tanganyika, so that the region could attain independence as one federation.

Earlier, in 1917, there existed a Customs Union between Uganda and Kenya, with Tanganyika joining it in 1927. This was followed by the East African High Commission that ran from 1948-1961; the East African Common Services Organisation (which became the foundation of the common undertakings) ran from 1961-1967.

In 1967, five years into independence that the East African Community was born, lasting 10 years until its dissolution in 1977.

In the theory of regional integration, the EAC of 1967-77 was already a Monetary Union, by the time of its collapse, with a Currency Board, and a parity currency. A parity currency means that each country had its own currency, but converting at par: One Uganda Shillings equaled One Kenya Shilling and equaled One Tanzanian Shilling. One key defining feature of the Community then, was its supranational parastatals through which the partner states took an active role in the region’s economy.

This was the era of such public enterprises as East African Railways and Harbours, East African Airways, East African Posts and Telecommunications, East African Development Bank. The latter two were headquartered in Uganda, and the EADB still soldiers on as a surviving institution of the old EAC.

Other areas of commonality included education, with a single syllabus and a single examination body, the East African Examinations Council; the University of East Africa with specialised colleges in each  country; the East African Literature Bureau engaged in publishing, the Inter-University Council of East Africa, and others.

Citizens of the community moved and worked across the region, in all spheres, from the professionals to the casual labourers. Kampala’s suburbs of Namuwongo for example still have communities whose roots are in Kenya, traceable to the EAC days.

As an economic bloc, the region presented a large market for foreign direct investments with most multinationals establishing themselves in the region.

Owing to a big settler European population in Kenya, among other factors, most multinationals established their regional headquarters in Nairobi. The EAC was a success story, and at the time of its dissolution, several countries had applied to join the economic bloc.

The Collapse and lessons for the present EAC

Various reasons have been advanced for the collapse of the old EAC. These have ranged from political differences especially between Uganda and Tanzania (though the actual quarrel and eventual war peaked in 1978-79, long after the EAC had been dissolved in 1977).

Another factor is ideological, pitting Mwalimu Julius Nyerere against President Jomo Kenyatta, culminating into the famous ‘man-eat-man society’ and ‘man-eat-nothing society’ vibes attributed to these leaders, in reference to the other’s economic ideologies (though the reality is that the man-eat-man society label against Kenya was coined by a Kenyan who worked for Mwalimu Nyerere then).

Pertinent as they may look, the actual collapse of the old EAC was occasioned by different levels of economic development, which meant Kenya taking a lion’s share of the EAC benefits, with the rest of the Partner States only importing from Kenya.

This primus inter pares sense made Kenyan officials question the relevance of the East African Railways and Harbours being headquartered in Dar es Salaam, and the East African Posts and Telecommunications being in Kampala, while they had substantive ministries in Kenya in charge of these sectors.

One other crucial factor that seems to be better left buried is The Kampala Agreement. Signed in Mbale Uganda, this sought to establish a rationalised, even distribution of industries across the region, as a means of ensuring balanced development and mutual benefits from the Community. ‘…one Partner State refused to ratify it…’, says our source, and this, according to him, is the core reason why the EAC collapsed in 1977.

He predicts the same fate for the current EAC, which, in his analysis, is built more on conventions and treaties, than substantive strong economic pillars on which to base and grow. Whereas time and resources have focused on governance, gender, minority groups, legislation, and other soft aspects, meaningful integration, he says, must revisit The Kampala Agreement and we start from there.

And his predictions may not be far-fetched, going by the cycle of non-tariff barriers characterising intra- EAC trade. From Kenya requiring Ugandan Tea to the Mombasa auction to be cleared as a ‘plant’, to Tanzania requiring Ugandan sugar-cane from Rakai to Kagera Sugar Works to await sanitary and phytosanitary clearance from Dar es Salaam, every day one non-tariff barrier or another crops up.

The single explanation is that each Partner State is trying to protect her turf in terms of jobs, markets and patronage, the typical scenario expected of seeking to integrate poor economies. Anyone out there with a copy of the Kampala Agreement?

Read more…

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