EAC Intra-Trade Hits U.S. Billion

East African Community Trade Hits U.S.$10 Billion

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In: Other East African News, Tanzania Foreign Investment News

TRADE among East African Community member states has continued to grow hitting 10.17 billion US dollars (equivalent to 23.75tri/-) by September last year.

According to the EAC Secretariat imports and exports in the seven partner states grew from 7.1 billion US dollars in 2019 to 9.5 billion US dollars in 2021 and by September 2022, the trade value was recorded at 10.17 billion US dollars, representing a 20 percent share in global trade.

EAC Secretary General, Peter Mathuki, attributed the increase in intra-regional trade to political goodwill among members of the Summit of EAC Heads of State and the relaxation of Covid-19 restrictions in the region, among other factors.

“The high-level discussions among the Heads of State had eliminated many Non-Tariff Barriers (NTBs) hampering intra-regional trade and there is hope that this and other factors will help raise the level of trade to at least 40 percent over the next five years,” he noted.

Since 2007, at least 257 NTBs have been cumulatively resolved and following the high-level summit on the Common Market Protocol held in July 2022, the EAC will review and discuss different issues impeding integration in the next Council of Ministers.

Regional ministers in charge of trade and finance set the 4th Band of the EAC Common External Tariff (CET) as 35 percent.

The CET is one of the key instruments under the Customs Union pillar, which justifies regional integration through uniform treatment of goods imported from third parties.

“From July 2022, imports of locally available goods into the region such as meat, furniture and textiles, have been attracting a tariff of 35 percent. The move aims at promoting local production, value addition and industrialisation,” said Mathuki.

He further disclosed that the bloc’s total trade with the rest of the world stood at $62 billion, adding that there was still room for improvement.

According to Mathuki, the bloc will have a single currency within the next four years.

“The single currency will ease business and movement of persons within the region. It is in line with our goal to make the region borderless so that people can move and trade freely as envisioned in the Common Market Protocol,” he said.

He further indicated that the Council of Ministers is expected to make a decision soon on the location of the East African Monetary Institute, the precursor to the East African Central Bank that will issue the single currency.

Having a single regional currency means that the power of issuing national currency will be taken from governments to a common institution, the East African Monetary Union.

Another important thing highlighted by the Secretariat is the process of sending a verification mission by the end of January to assess the readiness of Somalia after its application to join the regional bloc.

Mathuki described Somalia’s long Indian Ocean Red Sea route that links Africa to the Arabian Peninsula as a vibrant economic zone saying that it will bring immense benefits for the EAC.

“The exploitation of Somalia’s blue economy resources such as fish and the expansive coastline is also set to boost the regional economy,” he said.

Kigali will host the next annual East African Court of Justice sitting as part of the rotational mechanism aimed at implementing the policy of taking the integration to the people at the grassroots, according Justice Nestor Kayobera, the Judge President.

Source: allafrica.com

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