The five East African Community (EAC) countries – Burundi, Rwanda, Kenya, Uganda, and Tanzania – ushered in a common market as of July 1st, 2010, a project that has been expanded from the existing customs union.
A common market is built in hopes of creating free movement of goods, services, capital, and people within the constituent states as one region. As seen with other economic integrations such as the European Union, a common market is the precursor to a common currency, which in turn is a significant prerequisite to a common political platform.
The good news is that the EAC stands to become more competitive on the international stage. Its combined Gross Domestic Product is about $75 billion, which is just under a quarter of South Africa’s GDP, and trade with neighbors like Sudan, Congo, and Ethiopia will be easier with a consolidated market. While local businesses have already had an advantage with the internal customs union, multinationals will pounce on the opportunity to sell to a now 120-million strong market.
The bad news is that each of the EAC countries will find the need to be more competitive on an individual basis too. Kenya, with a better-skilled and –educated workforce, stands to benefit most, while neighboring Tanzania fears that many of its people will be unemployed soon.
What does all this mean for us young folks? It could mean that in the short term, many youth who are working may lose their jobs. But it could also mean that they find opportunities elsewhere in the EAC to diversify and expand their experience, either with school, or work. The situation is no different for young entrepreneurs; while the scope of their market has just broadened, providing them with the opportunity to make more money, the scope of their competition has also grown.
How can sustainable partnerships be created in the EAC common market such that governments and businesses improve on peoples’ livelihoods? Further, how can these partnerships ensure stability when the time comes for a monetary union… and then a political union?
Related links:
- The East African Community Portal
- The EAC Common Market Protocol
- The Economist on the EAC common market (via Abbay Media)
- The Citizen on the EAC common market
Thank you for bringing up this issue again. The interesting thing for me – personally – was to see how our neighbors reacted while the EAC Common Market was being discussed. Watani wa Jadi really invested in educating people to use or exploit the market to their advantage. In contrast, nothing was happening in TZ (at least, NOT to that [Kenyan] scale!).
It’s ok to be conservative and all that, but un/fortunately the borders are open right now; Tanzanians should stop discussing land issues etc., and focus on the ways to benefit from the EAC Common Market (A short, 14-page overview of the EAC Common Market Protocol – by Magaga Alot).
We Tanzanians need the challenge – and the EAC market will bring this. People should not fear about these ‘opened-up’ borders. Our governments should actively communicate to its citizens the pros and cons. On the political union matter, I think we shouldn’t aim for this. Zanzibar yenyewe inatutoa jasho.
what i think for this proceeding moment of market pressure and non stop market strategy over whole East African member states- its a perfect moment for Tanzania to reshape and redesign its market policy, bila hivo wazee kambi ya hema inaweza kulowa maji pakashindikana kulalika- also technology is very necessary to run these business
From The Citizen (12th April 2012):
“Impediments on the free circulation of goods due to unnecessary border controls and continued application of rules of origin on internal trade are among hurdles impeding attainment of a Single Customs Territory (SCT) for the region.”
Read more: http://thecitizen.co.tz/news/4-national-news/21412-border-controls-hinder-customs-union.html