Skip to main content

The East African Community Common Market

Is forging a common economic platform encouraging productivity at the cost of employability?

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:
(Posted on Vijana FM on Thursday August 5, 2010)

Labels

Labels:

Comments

Post a Comment

Popular posts from this blog

Tanzania is not Tasmania

Dear friends: Please let's stop refering to Tanzania as Tasmania. Here is why. Tanzania is located on the coast of East Africa, below Kenya. It is not origin of the the cartoon character from your childhood. Tasmania is an island which is part of Australia. The animal known to exist only on Tasmania is the Tasmanian Devil. Once again, you will see this is not the cartoon character you remember from your childhood. Let's summarize: Tanzania is not Tasmania.
Post a Comment
Read more

Policy Brief 2: Why is Tanzania Poor?

(Policy Brief # 2 Submitted December 6th 2007, for Econ 346 - Economic Development, Lafayette College) Over the course of the 20th century, Tanzania experienced a multitude of social, political and economic changes. It still remains poor today. The WorldBank classifies a ‘low income country’ – such as Tanzania – as one with a Gross National Income per capita of $905 or less (WorldBank Data 2006). As of 1992, Tanzania ’s per capita income was recorded at $110, and average per capita consumption was $0.5 per day (OECD 2000). Several possible factors have been blamed for contributing to current hardships, such as Julius Nyerere’s failed attempts to collectivize agriculture between 1961 and 1975 through his socialist Ujamaa policies as the first president of Tanzania (Pratt 1980). While pre-independence plans “focused on the commercialization of agriculture and the creation of industries that could reduce the need for a variety of imports”, post-independence interventions by the Gov...
4 comments
Read more

Serving up the fix

Originally published on Vijana FM | 22nd July 2012 On a recent album release by Nas called Life is Good , Anthony Hamilton sings “The world is an addiction / serving up a fix”. The track goes on to discuss the dangers of selling out in pursuit of irrational dreams; indeed, “you gain your life just to lose your soul”. Sometimes I wonder if Tanzania is losing her soul. Perhaps – as time passes – it is me growing more conscious, or media becoming more pervasive to drama. But it seems like this country is chasing grandeur that is alien to her history and at odds with what she needs today. Her history and her needs; what do these mean? For the purpose of this post, I am pointing to Tanzania’s historical pursuit to be an independent nation-state, free of international dues and reliance on help. I am also referring to her current state of affairs, mainly consisting of an inefficient system of education coupled with an unbalanced system of trade. There are a few example...
Post a Comment
Read more