EA needs own monetary union

Various stakeholders met in Arusha, Tanzania, recently to consider a road map to establishment of the East African Monetary Union. They say unity is strength.

Nothing captures the mood of the ancient saying better than the philosophy behind the East African Community.

For starters, the East African Community (EAC) is the regional intergovernmental organisation of the Republics of Kenya, Uganda, the United Republic of Tanzania, Republic of Rwanda and Republic of Burundi with its headquarters in Arusha, Tanzania.

The partnership aims at widening and deepening co-operation among the member States - politically, economically and socially for their symbiotic benefits.

The initial idea was for the EAC countries to establish a Customs Union in 2005; a Common Market by 2010, consequently a Monetary Union by 2012 and ultimately a Political Federation of the East African States.

But what are the real benefits of this ‘thing’ every leader seems excited to embrace?

My friend jokingly says that may be that will be a good idea to placate the cock- fights over scarce resources between the member states- including the contentious Migingo Island.

In a nutshell, regional integration aims to improve economic outcomes for all member states involved, although in practice not all participants achieve the same degree of benefit.

The ideal situation is which all states enjoy equal share of the benefits.

Unfortunately, ideal situations are so rare and often attributable to a utopian setting.

For instance, Tanzanians have always been sceptical about the arrangement and often times their authorities do not recognise harmonised regulatory standards already negotiated and in place.

We need to dismantle the belief that an Englishman’s home is his castle.

There may be better things done in other ‘homes’- so to speak.

Just recently I watched a car dealer, on a local TV station, bitterly complaining that despite the EAC customs union being in place, Tanzanian revenue authorities at the borders continue charging exorbitant duty and taxes on goods and products imported from Kenya.

“What is the essence of the customs union then?” he asked.