By Dr. Eve
HawaSinare;
The
Treaty establishing the East African Community was signed on 30 November 1999
and entered into force on 7 July 2000.
It has been amended twice on 14 December 2006 and 20 August 2007 to
admit Rwanda and Burundi. The objective
of the Community is to establish a Customs Union, Common Market and
subsequently a Monetary Union and ultimately a political Federation in “ order
to strengthen and regulate the industrial, commercial, infrastructural,
cultural, social, political and other relations of the partner states to the
end that there shall be accelerated, harmonious and balanced development and
sustained expansion of economic activities, the benefit of which shall be
equally shared…”( article 2 of the Treaty). The rationale behind regional
integration is that it will promote free trade faster within the region and
contribute to removal of trade barriers in international trade and thus promote
faster and more balanced economic development. Regional integration has neither
contributed to faster economic development nor contributed to removal of
barriers to international trade in the sense envisaged simply because so much
has changed in the manner we trade and invest and the world is so much more
interconnected economically. The experience of Europe has shown that
intra-regional trade and investment should be counterbalanced with a healthy
diversification of trade and investment elsewhere to survive any regional crisis.
Companies in Europe that have trade and investments in the European market as
well as outside Europe are faring better in the EURO crisis than companies that
have invested mainly in Europe
The
implementation of the east African regional integration model, so far, is
particularly fast, in reverse, ofa customs union, common market, monetary union
and apolitical federation without any measurable minimum thresholds of
macro-economic targets or fiscal discipline or budgetary limits to have to be achieved
as pre-conditions to any move forward. In fact the Treaty provides for establishment of a customs union,
a common market and then subsequently a
Monetary Union and ultimately a
political federation. The wording does not suggest a fast tracking of the
process but a progression from one stage to a higher stage of integration based
on tangible achievement of targets set for the relevant stage. Not that the
model is the best model for economic development today even if implemented
gradually given economic realities of
the times but that the model needs rethinking
at the very best and pragmatic
implementation at the very least.
For
some reason, however, there are politicians, the Community officials and
leaders as well as other zealots in the
public who wish to accelerate the process to start with the end- namely for
East Africa to move into a single currency, monetary union and political
federation and then common market in the
so called fast track model neither supported by the Treaty nor history. It is
the first regional integration arrangement in the world to be implemented in
reverse. Those who are pushing for fast
tracking the process are ahead of the democratic will of the people, if not in
the whole of East Africa, then certainly in Tanzania. In excess of 75% of
Tanzanians opposed fast tracking the process.
Already
preparation are in process for passing East African regional laws to replace
national laws in important key aspects of the economic, monetary and fiscal
policies as well as social behavior, social life, employment, which will
effectively transfer national sovereignty on these issues to a regional
government made up of unelected regional executives who then decide when the time is right to move from
one stage to the next higher stage often without any reference back to the
electorate! If we take this route, we
will fail badly.
HOW SHOULD EAST
AFRICA PROCEED?
My
advice is: There is no need to amend the Treaty Establishing the East African
Community. Just implement the East African Community Treaty pragmatically and gradually but not fully
because the end-game of transferring power to a regional body made of appointed
officials but not elected is essentially undemocratic. Start with
integrating the market internally in each member state (create national markets
by removing Local Government Authorities’ (LGA) permits to trade and investment
and allow for single licenses to apply nationally) and thereafter regionally. For the region, start
with things that can be implemented regionally practically; such as roads,
railways, environment, macro- policies, international trade negotiations, laws
on pollution, promotion of high quality education as the foundation to the
development of the region. Cooperate and coordinate things that are best
implemented together but stay separate countries with separate laws for as long
as it is practical. For goodness, we have enough problems with our own
politicians imagine multiplying these times five or six!!!!!!! We will not
solve our current and separate national problems through a quick Federation.
East Africa has
just started the regional integration project. It is not yet ready and should
not be ready for a single currency, monetary union, fiscal union or a fast
tracked federation. The necessary economic achievements and fiscal targets are
absent. The East African Community project as
currently implemented is running towards monetary union and a fast tracked
federation on EMPTY and without the East African population behind
it.
CONCLUSION
The
political leaders should be persuaded to
slow down the integration processing the
manner professed and relate the stages to realities on the ground. Most
importantly no deeper integration should be committed by any member state, in
particular Tanzania that transfer’s power
to the Community on monetary and fiscal policy without consulting the people in
a referendum. If consulted, the people of East Africa, in particular
Tanzania, will not accept what the
Community is pushing us to do now. They know better. They want leadership that
decides on the key issues touching on their lives to be accountable to them
directly.
****Dr. Eve
HawaSinare is a senior partner at REXATTORNEYS and a corporate lawyer and
advocate in Tanzania.