There are still several bottlenecks preventing the East African Common Market becoming a reality.

“Common market, open space can only be achieved if the environment is open. If we are going to have free flow of goods and services, mutual recognition agreements all the non tariff barriers have to be eliminated,” Stephen Ruzibiza the Chief Executive Officer of Rwanda’s Private Sector Federation (PSF) said last week.

He was speaking during a dialogue organised by the East African Trade and Investment Hub (EATIH) together with PSF in Kigali.

Ruzibiza said, “This is when we shall say we have a vibrant common market. The private sector here has a role in my opinion”

The focus was on reviewing the implementation status of the EAC common market and customs union and explore opportunities for stronger private sector participation in rule making, implementation and monitoring of trade facilitation.

Participants shared viwes on how the EATIH can cooperate with the PSF and other partners in respect to getting the EAC Common Market Protocol implemented much faster than at present.

The Common Market Protocol has been in force since 2010, in line with the provisions of the EAC Treaty. It follows the Customs Union, which became fully-fledged in January 2010.

Basic ingredients of the Protocol are Free Movement of Goods; Free Movement of Persons; Free Movement of Labour / Workers; Right of Establishment; Right of Residence; Free Movement of Services; Free and Movement of Capital.

Ruzibiza said, “It is good that now the private sector together with its partners is coming up with platforms, suggestions and ideas of how to achieve this.”

“There are a few things we need to go into details to sort out this kind of thing. Here I can focus on value of money, free flow of goods and services, because this is the backbone of a vibrant economy,” he said.

The rationale for the EAC common market is compelling.

It works with the five EAC partner states with a market of 153 million people and a combined GDP of $146 billion. It can create unpredictable opportunities for the private sector in a way no partner state can do on its own.

“Regional integration process is not easy. It needs everybody’s support,” Micheal Baingana, Country Representative, EATIH said.

Under the context of the EA Common market protocol, Rwanda is focusing mainly on services which the PSF also wants to focus on mainly.

“The PSF is part of the integration with a number of issues that outstand and therefore need to be looked into,” Baingana said.

“The public and private sector need to sit together, select which things should be done. What is important for a country like Rwanda now might not be important for Kenya therefore this is why they normally meet and have negotiations,” he said.

According to Baingana, the private sector is at the higher side of determining which area should be liberalized more.

“When you look at the combined GDP of the EAC region though growing, we still have some way to go in as far as catching up with some of the African peers,” Alfred K’Ombudo, Senior Economist, East Africa Trade and Investment Hub said.

“The common market ideally should be an excellent response towards ensuring that we are able to attract investors, grow the economy and be at par with some of the peers that we are competing with,” he said.

“For the EAC to be competitive and to be a strong trade and investment destination it’s important for the common market to work and to work in reality.”

“This means that the rule and regulations that are supposed to allow free movement of goods, free movement of services, capital and labor should work in reality, not just at the regional level but also at the domestic level,” he said.

The East African Trade and Investment Hub is a United States Agency for international development (USAID) supported initiative running for five years 2015-2019.

The Hub has managed to work with other partners to strengthen the region’s ability for more trade and investment.

Other elements of the Protocol are underlying the EAC Common Market are operational principles of the Community, namely:

• Non-discrimination of nationals of other Partner States on grounds of nationality;
• Equal treatment to nationals of other Partner States;
• Ensure transparency in matters concerning the other Partner States; and
• Share information for the smooth implementation of the Protocol.

 
Source: Business Week

Disclaimer: The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of TradeMark Africa.