As the EAC Heads of State gathered in Nairobi at the weekend both for the infrastructure retreat and the Heads of State Summit one can only look back at the progress with optimism for the future.
Looking at the journey that was and still is, a lot of great effort has gone into the integration process for the region. The treaty for the Establishment of the East African Community was signed on November 30, 1999.
It set a vision for the eventual unification of the EAC Partner States and outlines a comprehensive system of co-operation among Partner States in trade, investments and industrial development, monetary and fiscal policy, infrastructure and services, human resources, science and technology, free movement of factors of production, agriculture and food security, environment and natural resources management, tourism and wildlife management.
The first stage of the EAC integration came with enforcement of the EAC Customs Union Protocol in January 2005 which had five years transitional period for elimination of internal tariffs.
The benefits of the Customs Union to the businesses are level playing field due to implementation of Common External Tariff against imports from third countries entering EAC, increased utilisation of production capacities due to larger EAC market that was to some extent protected by the Common External Tariff (CET) and increased market opportunities in the EAC.
Economies of scale
Businesses have been able to increase their competitiveness due to economies of scale and production efficiency.
Benefits abound but challenges are in the right of residence framework in that the citizen of a Partner State can only reside in the territory of another Partner state if he/or she is engaged in economic activity and when one stays for a long time, one is not guaranteed permanent residence.
In the area of free movement of services, partner states agreed to start with seven sectors mainly professional and business, communication, distribution, education services, financial services, tourism, travel related services and transport.
Kenya opened up its services sector since 2010 to other partner states adopted a progressive liberalisation between 2010 and 2015.
There is a need to have strong regional law and policies governing trade in services. Manufacturers appeal to Partner States to fasten re-aligning their national laws with the Common market Protocol in order for the region to reap full benefits.
The writer is the chief executive of Kenya Association of Manufacturers.
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