Jean Claude NsengiyumvaDeputy Secretary General

(Productive & Social Sectors)

Lake Tanganyika Basin Development Conference, 27-29 Nov 11, Bujumbura

The Common Market Protocol was signed on 30th Nov 2009 and launched in all Partner States on 1st July 2010

The Four Pillars of the Integration Process Key Features of Customs Union and the

Common Market Facilitating Realisation of the Common Market Achievements Challenges Addressing the Challenges Looking Ahead

Cust

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Uni

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Com

mon

Mar

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Mon

etar

y U

nion

Politi

cal

Fede

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Mutual Trust Political Will Sovereign Equality Peaceful Co-existenceGood Neighbourliness Peaceful Settlement of DisputesGood Governance Equitable Distribution of Benefits

Mutual Benefit

People-Centred Creation of Enabling EnvironmentRule of Law

Market-Driven

The East African regional integration is a progressive process

Movement from one level of integration to another is through negotiated protocols, starting with Customs Union Protocol followed by Common Market, then Monetary Union and ultimately Political Federation

Customs Union was launched in January 2005

Common Market was launched in July 2010

Negotiations on Monetary Union are ongoing

Sensitization on Political Federation is ongoing

Cust

oms

Uni

on

Free movement of goods

Common External Tariff

Removal of NTBs

Trade Facilitation

Institutional Framework for Customs Management

PILLAR 1

Com

mon

Mar

ket

Free movement of Services

Free movement of Persons and Labour

PILLAR 2

Com

mon

Mar

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Free movement of Capital

Right of Establishment and Residence

PILLAR 2

With the establishment of the Customs Union in 2005 and the Common Market in 2010, EAC has realized systematic and steady progress on its Treaty commitments

In order to facilitate realisation of the Customs Union and Common Market, integration efforts are ongoing in many sectors guided by the provisions of the Treaty and decisions of the EAC Policy Organs:

Infrastructure

Energy

Environment & NR

Agriculture & FS

ICT

OSBP

Development of standardised framework and benchmarks for mutual recognition of Academic & Professional Qualifications

Harmonisation of education systems and training curricular

Harmonisation of policies and laws in various sectors

Review of Immigration policies and laws

Increased intra-EAC Trade: Intra-EAC trade has grown by over 50% as a

result of the Customs Union since its launch. Signing of the Double Taxation Avoidance

Agreement in Dec ember 2010 is expected to increase benefits of Customs Union

Significant cross-border Investments and Foreign Direct Investment Inflows

FDI have increased from USD 683m to USD 1.7b over the past five years

Contrary to initial fears, there is a general fair spread and distribution of the benefits among the Partner States under the Customs Union.

Partner States have agreed on a programme to review internal laws to conform to the CM fully by 2015

Some Partner States have relaxed travel and work permit requirements for East Africans

East Africans treated as residents while visiting Partner States

Priority given to projects in infrastructure - Roads, Railways, Inland Waterways, Ports and Harbours, Communications/ICT, Energy and Civil Aviation, Energy, Environment and Natural Resources Management and Food Security

24 hour opening of border points within the region, opening of more border points and creation of one stop border points for busy points

e.g Malaba, Katuna, Namanga, Busia, Gasenyi/Nemba, Isebania

Project on Integration of financial markets has been initiated

Modalities on transferability of workers’ social security benefits are being negotiated

Lack of awareness by the Nationals of the Partner States on the EAC integration agenda and the benefits of the integration process.

Lack of comprehensive sensitisation of the East Africans on the provisions of both the CU and the CM Protocols.

NTBs to Customs Union – Road blocks, paper work, …

Slow start of Common Market despite high expectations during its launch

Crowded calendars of National Assemblies could delay amendment of national laws to conform with provisions of the CM Protocol

A program to address challenges to CU and CM has been put in place and will be implemented in close collaboration with EAC Partner States and East African Business Council.

Awareness creation by the EAC Secretariat and the MEACs in Partnership with the Private sector at national and regional levels on the benefits of the CU and CM

Removal of trade barriers through simplification/ harmonisation of procedures

Commitment to total removal of NTBs

The EAC programme in the next five years intends to achieve, among others, the following priority strategic objectives:- Strengthening the operations of the Customs Union, in

particular the establishment of the Single Customs Territory

Implementing the Common Market Protocol Protocol on the Monetary Union Intensifying regional Infrastructure development; and

establishing adequate and reliable Energy supply Enhancing agricultural production and food security Full ratification and implementation of the Protocol on

Environment and Natural Resources Management

Actualization of the Common Market and the related projects and programmes can result in dramatic economic upturn of the EAC region.

The prompt domestication of the provisions of the Common Market Protocol within Partner States’ National Laws and their implementation is, therefore, critical.

Significant gains in Cross-border Investments and Foreign Direct Investment Inflows expected.