East Africa: How EAC Can Profit From Key Trade Pact

Smale-scale traders at the Rubavu-Goma border post transact business (file photo).

Arusha — The East African Community (EAC) stands to benefit from the recently unveiled African free trade area if it consolidates its internal market, according to the East African Business Council (EABC).

"Failure to remove trade impediments means that our bloc will remain weakened," EABC executive director Lillian Awinja said on Wednesday.

She told The Citizen that the African Continental Free Trade Area (AfCFTA) unveiled in Kigali last week could pull some EAC states into the new pact at the expense of their trade relations.

"This means the benefits going elsewhere...to the rest of African market instead of our internal market," she said on the sidelines of a regional workshop on trade between EAC and the outside world.

AfCFTA was launched by leaders of the African Union (AU) member states in Kigali on March 21, and the continental body hopes that it will be the world's largest single market with a cumulative GDP of $3.4 trillion.

The milestone agreement is seen as a key part of AU's long-term development plan, Agenda 2063, which calls for easing of trade and travel across the continent.

The pact came in the wake of advanced talks on a tripartite trade area comprising the EAC, Common Market for Eastern and Southern Africa (Comesa) and South African Development Community (Sadc), constituting more than 60 per cent of Africa's GDP and half of the continent's population of 1.2 billion.

But Ms Awinja said the EAC may not immediately benefit from the continental trade agreement unless it addressed impediments hindering its intra-regional trade.

"Non-tariff barriers inhibiting our trade have never been fully resolved," she said, noting that AfCFTA will benefit EAC "if it will have additional inputs that will consolidate our market".

The EAC director general of Customs and Trade, Mr Kenneth Bagamuhunda, said AfCFTA should be preceded by full implementation of the Tripartite Free Trade Area (TFTA) bringing together EAC, Comesa and Sadc. "The TFTA is the stepping stone to the AfCFTA because the only thing that remains is TFTA's implementation," he said.

However, the Speaker of the East African Legislative Assembly (Eala), Mr Martin Ngoga, urged EAC partner states to support the new initiative.

"National and regional parliaments should push for domestic legislative realignments following the historic signing of AfCFTA in Kigali," he said.

Mr Ngoga, who was speaking during the 138th Inter-Parliamentary Union (IPU) in Geneva on Monday described the move as significant in Africa's development.

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