The private sector in the community has been urged to drive the buy and build East Africa initiative
Foreign Direct Investments (FDI) in the EAC dropped by 43% to USD. 4.9 billion in 2020
Jobs declined by 2%, wiping out the gains made in previous year
Trade between East Africa Community countries dropped by 5.5% to USD. 5.9 billion in 2020 due to COVID-19 while exports from the bloc to the world hit 16.2 billion in 2020 a 3% boost in comparison to 2019.
This is according to the East Africa Business Council CEO John Bosco Kalisa who urged the private sector in the community to drive the buy East African, build East Africa narrative.
He added that the campaign is central in driving the economic recovery agenda for the EAC bloc amid COVID-19 pandemic.
He spoke during a webinar on EAC Trade & Investment Recovery amidst COVID-19 organized by the East African Business Council.
Speaking in the same event, the Director of Trade at the EAC Secretariat, Alhajj Rashid Kibowa said the EAC Post COVID-19 economic recovery plan is under country consultation.
Director Kibowa stated that Foreign Direct Investments (FDI) in the EAC dropped by 43% to USD. 4.9 billion in 2020 and jobs declined by 2%, wiping out the gains made in previous year.
In 2019 EAC bloc recorded USD. 8.66 billion FDI a 375% rise from 2018.
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Director Kibowa said the EAC Secretariat had embarked on digitalization & harmonization of COVID-19 procedures to ease movement of cargo and holds regular consultations with the Ministries of Health, Finance and Trade to monitor & gauge the social and economic impact of COVID-19 in order for the EAC bloc to move in unison.
Kibowa said the EAC Post COVID-19 economic recovery plan sets out key strategies among them attracting investment in ICT manufacturing & health and incentives for promotion of regional value chains.
Other areas targeted include diaspora investments, innovation centers, and elimination of Non-Tariff Barriers and SMEs promotion.
Access to new Tripartite Free Trade Area (TFTA) and African Continental Free Trade Area (AfCFTA) markets, as well as export promotion and e-commerce & digitalization of trade are also part of the strategy.
Commenting on the same, Alex Njombe Senior Partner at KPMG Tanzania said that vaccination against COVID-19 is important to reduce the negative impact of COVID-19.
He urged East African companies to adopt digital technology to build enterprise resilience in the new norm supporting simulations to predict future risks and opportunities on finances & liquidity, operations, supply chain, commerce and macro-perspectives of the economy.
Njombe said in the second phase of COVID-19 businesses triggered continuity plans to boost resilience as the GDP growth and capital markets decline and credit risk rose due to the impact of the pandemic.
He further elaborated that the third phase of COVID-19, ushered in recovery with more capital projects, import substitution of disrupted supply and businesses tapped into new opportunities.
Kudzai Madzivanyika, E.A Senior Manager-Regional Policy and Trade USAID Policy LINK Project urged the EAC Partner State to implement the 10% financial budget requirement for the agricultural sector in line with the Comprehensive Africa Agriculture Development.
She said the COVID-19 affected the marketing and storage of agricultural products, disrupted supply chains leading to access to agricultural input, labour and price volatilities.
She said the competitiveness of the agricultural sector in the EAC bloc is hindered by low productivity, trade barriers, import bans, Sanitary and Phytosanitary Measures (SPS) high taxes, transport, inadequate warehousing and storage facilities.
She urged for evaluation and monitoring of policies and plans, putting in place safety nets, elimination of trade restrictions & NTBs, trade facilitation for foods, perishables & agri-products, diversification and increasing production capacities and integration of regional value chains.
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Madzivanyika, said the AfCFTA should address Africa's USD.100 billion food import bill projected in 2030.
Others who spoke at the event include Yves Ngenzi, Regional Coordinator, East Africa Tourism Platform, who urged all EAC Partner State to sign up for the Single African Air Transport Market protocol to reduce the cost of air transport.
He called for innovation & diversification to new services such as sports tourism & MICE and marketing the EAC bloc as a single tourist destination.