By James Karuhanga

Senior Researcher, Uganda

Great Lakes Centre for Strategic Studies

 

In a long statement delivered at the parliament, Uganda’s First Deputy Prime Minister and Minister for the East African Federation, Eriya Kategaya stressed the need to go beyond the Customs Union (CU) towards a political integration.
 

Kategaya pointed out that economic integration is slow in the absence of political integration and that benefits of integration under pure economic integration take longer to spread around the community evenly.
 

‘‘Our President as you know has been arguing for a long time that economic integration of African countries is not enough, especially given the strategic security of the African people, and that there is an urgent need to accelerate political integration to provide impetus to economic integration for the benefit of the present and future generations of Africa,’’ he said.
 

Other factors for political integration:
 

  • Weaker negotiating positions of countries when they act as individuals rather than as a bloc. This is evident in the case of WTO, AGOA, Paris Club, etc,

 

  • Duplication of effort, resulting in waste of resources, when countries act individually in competing for investment in similar sectors,

 

  • Inconveniences to communities arising from haphazardly drawn colonial boundaries,

 

  • Difficulties of achieving integrated use of natural resources for the people’s common good,

 

  • Limitation of individual countries lacking capacity to develop defense industries and advance military technology,

 

  • The fact that landlocked countries like Uganda are held hostage by irrational boundaries,

 

  • Misuse of common natural resources due to lack of a common policy to exploit them for the common good and,

 

  • The danger that Africans are mislead to hate each other and love their enemies at the same time.

 

 

Four key stages must be undergone to attain political integration: Customs Union, Common Market, Monetary Union and finally, Political Federation. The protocol for establishment of the Custom Union was signed on 2 March, 2004 and came into effect on 1 January, 2005.
 

Kategaya explained that smooth functioning of a Common Market entails enhanced macro economic policy harmonization and coordination particularly with regard to fiscal regimes.
 

‘‘It is envisaged that the protocol (on the Common Market) should be in operation by January 2010,’’ he said ‘‘the issues to be addressed will be free movement within the East African region of factors of production.’’ The right of establishment of residence is also one of those issues.
 

On the Monetary Union, he pointed out that the three historical EAC countries had achieved currency convertibility and need to harmonize macro economic policies with regard to exchange rates, interest rates, monetary and fiscal policies.
 

 Kategaya also optimistically pointed out that some institutions have already been established which is a basis for political federations.
 

‘‘The East African Court of Justice, and the East African Legislative Assembly are some of the examples,’’ he said pointing out that in addition, there were a number of Memoranda of Understanding guiding cooperation in defense or security and foreign policy.
 

Despite the above achievements, he also pointed out a number of obstacles as identified by the Wako Committee. This committee, chaired by Hon. Amos S. Wako was established to develop and recommend a roadmap for the fast tracking of the political federation.
 

Hurdles and Obstacles to Integration
 

  1. Governance and institutional constraints,
  2. Budgetary constraints,
  3. Lack of enforcement machinery and sanction mechanism,
  4. Lengthy decision-making processes,
  5. Legal and administrative handicaps and,
  6. Capacity constraints.

 

‘‘In my view, these constraints are surmountable if we act together,’’ he said while emphasizing that, ‘‘we want the process of the East African integration to be people-led so that our people own it, advance it and sustain it.’’
 

Trade and development imbalance issues among partner states, fear of loss of sovereignty, loss of revenue, jobs and land as pointed out in the Wako report can be solved according to Kategaya.
 

‘‘To me, these concerns, as important as they may be, cannot outweigh the benefits of our coming together,’’ he argued ‘‘certainly, our integration is the solution to many of these problems.’’ He explained that details would be worked out to address those fears.
 

International Uneasiness over Bigger EAC Federation
 

Kategaya stated that as the Wako report pointed out, uneasiness over a new and bigger EAC Federation, arises from a potential strategic military and security tilt in the balance of power in and out of Africa.
 
Kategaya explained that the fear is exaggerated since despite the big size and population, the Federation’s combined per capita Gross Domestic Product (GDP) of about US $ 300 would still be within a ‘least developed country’ category.
 

‘‘Our interest is to pool our resources together, to build a reasonable force capable of protecting and promoting the people and wealth of East Africa,’’ he said.
 

Concern over Overlapping Membership
 

The GLCSS maintains that proliferation of membership by countries to various regional and international organizations as mentioned in the Wako report is a major hindrance to integration. As a case in point, Tanzania is a member of SADC while Uganda and Kenya belong to COMESA.
 

Technically, it is impossible for a country to belong to more than one bloc. Countries would have to join one regional bloc for integration to be successful and sustainable. GLCSS believes that unless a practical solution is reached on this issue and others, nothing much will be attained in the integration.
 

‘‘We are cognizant of these issues and we agree that practical problems arise from multiple memberships to various regional and international organizations,’’ Kategaya said. He also understood the fact that the bloc envisages a common EAC external trade policy for the states involved.
 

GLCSS observes that this is a key factor threatening to delay or even derail the on-going Economic Partnership Agreements (EPAs) being negotiated between Eastern and Southern African (ESA) countries and the European Union. These agreements/negotiations are intended to restructure trading arrangements between the EU and the ESA countries.
 

As Kategaya mentioned, the implication of the present configuration is that Kenya and Uganda will adopt a different external trade policy from Tanzania when the EU-EPAs are concluded. Presently also, under the World Trade Organization (WTO) Uganda and Tanzania are treated as LDCs whereas Kenya is considered a developing country.
 

‘‘It is necessary for the three countries to rationalize and harmonize their configuration under the EU-EPA process and to be treated under the same group under WTO in order to achieve a common external trade policy,’’ Kategaya stressed and pointed out that the three countries were in the process of addressing this issue.
 

William Church is director of the Great Lakes Centre for Strategic Studies, a London-based think tank with offices in Central and East Africa. You may contact William Church at wchurch@glcss.org. GLCSS trains African journalists, offers an on-site internship to foreign African studies students, and manages an exchange program with journalists from the United Kingdom, the United States and Europe.
 

 

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