As the 38th meeting of the East African Community (EAC) Council of Ministers got underway at the EAC headquarters in Arusha, Tanzania in early May, questions were asked about the current threats to the trade bloc, including accusations of ‘trade wars’ and border closures between Rwanda and Uganda.
Many are concerned about whether the region will be able to transform these woes into strengths through successful mediation by countries such as Kenya. There are also questions about its ability to continue taking a lead in Africa’s transformation into a continental economic bloc.
The EAC is one of eight regional economic communities recognised by the African Union (AU) as building blocks of the envisaged African Economic Community.
One of the more ominous questions was whether the community would for a second time survive the upheavals that saw it come crashing down in 1977, at the height of a customs union success. Will political differences between leaders and feuds between member states halt the momentum it has achieved in the short period since its relaunch in July 2000? Will the new EAC remain possibly Africa’s most successful case for regional integration?
Recent headlines such as ‘Kigali accused of fueling troubles in Burundi’, ‘Uganda, Rwanda feud restricts free movement’ and ‘Will Uhuru Kenyatta mediate Uganda, Rwanda row?’ echo the difficulties that precipitated the collapse of the old EAC. Tensions between Rwanda and Uganda, on the one hand, and Burundi and Rwanda, on the other, remain high and threaten progress within the bloc of six countries with an estimated population of 195 million.
The EAC five-day ministerial meetings between 6 and 10 May were set to consider ‘several matters geared towards deepening and widening the regional integration agenda’. These included reviewing plans for the establishment of a common currency and a political federation. Discussions of these plans began at the February 2019 summit, where President Paul Kagame of Rwanda took over the presidency from his Ugandan counterpart Yoweri Museveni.
Africa’s fastest growing region
The success of such plans will confirm the community’s reputation as the most rapidly integrating regional economic bloc over the last few years. This is perhaps because of the need to make up for lost time after its relaunch and its pursuit of the ultimate goal of political federation.
Since its rebirth on 7 July 2000, with three original member states – Kenya, Uganda and Tanzania – ratifying the treaty of establishment, the regional bloc has expanded beyond its old borders. Burundi and Rwanda became members in July 2007, while South Sudan joined in September 2016. The former have also joined the customs union, which became operational in January 2005.
The EAC is also ‘the fastest growing region on the continent with a robust GDP growth forecast of 5.9 percent from an estimated 5.7 percent in 2018’, according to the African Development Bank’s 2019 African Economic Outlook.
A potential locomotive for the continent
Following the ratification of the African Continental Free Trade Area (AfCFTA) by the required 22 countries, the AfCFTA is now set to enter into force on 30 May 2019. Heads of state are expected to hold an official launch for the trade bloc in Niamey, Niger ahead of the AU coordination summit in July.
The EAC, with its vast experience, could contribute to this ambitious continental project. However, it first has to overcome its current difficulties. With the disintegration ghost in the EAC’s history threatening to resurface, icy diplomatic ties and accusations of a ‘trade war’ from both Kampala and Kigali precipitated the 27 February closure of the Katuna/Gatuna border post between the two countries. This closure of the busiest crossing point between the countries has drawn in Kenya’s mediation, which stands to lose from an escalation in the trade stand-off.
Rwanda closed the border post to stop its nationals from crossing into Uganda, allegedly to protect them from what officials termed ‘illegal arrest, torture, harassment and deportation by Ugandan authorities’. On its part, Uganda accused Rwanda of espionage and infiltration of its security agencies.
Two months later, as the countries sought to end the impasse through diplomatic channels, signs emerged that tensions were easing as Rwanda allowed Gatuna residents to cross the border. Other Rwandans, however, were still prevented from crossing at Gatuna.
Kenya’s diplomacy put to the test
Kenya’s success or failure will allay or intensify fears of an EAC break-up. It will determine whether the current threats of disintegration and internal conflict can be transformed into strengths that can take the regional bloc forward.
The country’s hand has been strengthened by its February re-election to the AU’s Peace and Security Council (PSC). Its diplomatic status is likely to receive a further boost as it lobbies for a non-permanent seat at the UN Security Council for the 2021–22 term. These factors also raise hopes of Kenya’s successfully weighing in on the ongoing attempts to resolve the crises in Burundi and South Sudan.
The consequences of an EAC collapse would be felt across the region and beyond, at a time of economic slowdown in China, a protracted Brexit, turbulence in Europe, trade wars between the United States and other major world powers, and cautious optimism about sub-Saharan African economies. Turning the current upheaval into a positive could shape a stronger region that is likely to tower above others in terms of economic growth and trade opportunities.
An alternative economic bloc
The EAC should therefore build on Ethiopia’s current optimism and enthusiasm to further regional trade by negotiating an alliance beyond the EAC borders through an inclusive economic arrangement. This would lead to an alternative economic bloc or regional realignment that takes into account geo-political realities. It would also take advantage of East Africa’s rapid economic growth and potential to spearhead continental integration.
This article is part of a special PSC Report focus on regional economic communities in the run-up to the first AU Coordination Summit on 7 – 8 July 2019 in Niamey, Niger.