Ordinary citizens have not felt impact of EAC - Daily Monitor

Ordinary citizens have not felt impact of EAC

Saturday December 26 2009

Source: EAC

Source: EAC 

By Mark Kirumira

Peter-Claver Mugizi, 35, lives in a two-roomed house in Ssisa village, Katabi Sub-county, Wakiso District.

He earns his bread from doing menial jobs for better-to-do villagers. This earns him a paltry Shs2,000 ($0.8) at the end of each day to cater for his family of five. To him, life is about where he will get his next meal.

When the leaders of the five East African Community (EAC) countries recently signed a landmark agreement for a common market to allow free movement of people, goods, labour and capital across the member countries, Mr Mugizi said he did not know what the fuss was all about.

Not aware
“I have never heard of such a thing because to me what matters is how I will go through each day,” said Mr Mugizi.

The customs union, which the leaders signed in November and which comes to effect on July 1, 2010 after ratification by the member countries, is supposed to be one of offshoots from the integration of the five countries.

However, according to a recent survey, ordinary East Africans like Mr Mugizi have so far not felt the impact of the integration process since it became operational 10 years ago.

The survey, titled Benefits Experienced by Ordinary Citizens from the East African Community Regional Integration, was released in Arusha, Tanzania last month by a team of technocrats led by Regina Mwatha Karega.

The survey had 900 respondents interviewed with 300 respondents in each country interviewed. They included ordinary citizens and policy makers, majority of whom were between 36 and 45 years.

Free movement
According to the study, the most important thing most ordinary people know about the EAC is that it has helped them move freely across borders with minimal identification yet there are a lot more benefits that they could enjoy.
In Kenya, 82 per cent female and 78 per cent male had perceived the integration process from their ability to travel anywhere in the region with minimal identification. This contrasted with 76 per cent female and 69 per cent male in Uganda as well as 55 per cent male and 26 per cent Tanzanians.

The report emphasised that the documentation process of gaining entry into another partner state had lessened and that there were fewer queues at border points.

“Fifteen years ago, I used to catch the earliest bus to Nairobi for business so I don’t find a queue at the Malaba border but I am glad that now I don’t have to go through all that hustle,” says Hajj Mubarak Kivumbi, a trader on Luwum Street, who says he has plied the Nairobi-Kampala route for the last 25 years.
While most of the interviewees acknowledged that they clearly knew about the EAC, it also emerged that most understood it to be made up of the three original partner states; Kenya, Uganda and Tanzania. They did not mention Burundi and Rwanda who only joined in 2007.

The report observes that Kenyan citizens were quite familiar with Kenya, Uganda and Tanzania as partner states with a high mention of 93.6 per cent, 92.3 per cent and 92 per cent respectively.

In Uganda, 89.3 per cent of the respondents knew that their country is an EAC partner state while 81 per cent identified Kenya and 76 per cent identified Tanzania. However, only 50.6 per cent and 44 per cent Ugandans were able to identify Rwanda and Burundi as partner states.

“These findings clearly stipulate that EAC ordinary citizens are not very clear on which partner states comprise the East African Community,” notes the report.
Business opportunities across the three east African countries were also quoted widely in the report as benefits being enjoyed. In Uganda 45 per cent, 21 per cent in Tanzania and 31 per cent Kenyans mentioned that there has been increased business opportunity in the region.

Ability to buy goods from other regions cheaply was mentioned most (53 per cent) by Kenyans followed by Ugandans (26 per cent) but this aspect was not popular among Tanzanians who had only 4 per cent.

The chairman of the Uganda Manufacturers Association, Mr Gideon Badagawa, says as manufacturers, they are yet to see the benefits of the integration process.

Conducive business
“For us, benefits are yet to show because the market is yet to expand. But with the integration taking shape and a market of over Shs130 million people, maybe we shall,” he said.

“The trade balance favours Kenya and in fact it is negative for Uganda because everyone from manufacturers to the ordinary person, buy from Kenya more than from Tanzania.”

The respondents also noted that the process of integration has provided a conducive environment for informal business at the borders of the three partner states.

The border points in Malaba, Busia and Lwakhakha between Kenya and Uganda were extremely busy during market days because of the freedom of movements for ordinary citizens.

It was further observed that both legal and illegal routes were used. In Malaba for instance, goods are bought either in Kenya or Uganda and sold on market days across the border on alternative market days.

Booming trade
A 2008 study by the East African Business Council, an apex body of business associations in the region, showed the cost of unrecorded trade in these border towns ran into millions of dollars.

For instance trade at the Namanga border on the Kenyan side was $12.5 million, while the Malaba border on the Uganda side was $13,531.

While at least half the respondents mentioned at least one benefit, some 48 per cent of Tanzanians and 16 per cent Ugandans said they do not know any benefits being enjoyed so far as a result of the process of integration. None of the Kenyans stated they did not know of any benefits being enjoyed so far as a result of the process of integration.

The study instrument had a section that focused on the experiences of professionals. It was established that 41 per cent of the professionals interviewed had previous experience working across the three pioneer partner states but 59 per cent had no previous experiences before the integration process began.

Before the mid-nineties, it was extremely difficult for a member of a partner state to work in another. But nowadays, it is the direct opposite. Hundreds of Kenyans have started up or worked – at both top level and junior level – in so many companies in Uganda.

Mr Peter Njoroge, a Kenyan media and public relations practitioner, who came to Uganda about eight years ago to start up a business in Kampala says while he was applying for a work permit, it took him about a year to get it, and at a very high cost.

Tiring process
“Getting the permit really took me time. As if that is not enough, I paid about Shs3 million for it. Such a scenario implies that if you are an employer, you can’t easily recruit people from other neighbouring countries,” he said.
Mr Njoroge now believes that the free movement of labour across the partner countries, which comes into operation next year, is a fallacy, saying citizens of particular countries may resent people from other countries to come and take up their jobs.

“The reality is that many East Africans are jobless and if you allow people to work anywhere, certain nationals will have to be out competed and they will cause all sorts of problems,” he argued.

Mr Godwin Mukasa, who works in the Tanzanian city of Arusha, says one has to part with $600 to get a three-year work permit but warns that unless you bribe, you can take up to four months to receive it.

The survey also observed that it was a requirement that one enters into another country with a yellow fever card, an aspect some people found self-defeating.
“A quick check, however, showed that different immigration officers demanded the yellow fever cards. At the Arusha Airport for instance, the yellow fever card was demanded for by some immigration officers while in Namanga border, no officer demanded the yellow fever card.”

High taxes
According to the report, the challenges that continue to bog down the East African integration process include slow verification of documents at all points, high taxes were mentioned by all ordinary citizens as high.

The biggest aspect that was mentioned by most of the respondents in the three countries was harassment by custom officials. The report did not mention the kind of harassment but Mr Issa Sekitto, the Spokesman of the Kampala City Traders Association, an umbrella body of traders in Kampala, agrees with the survey that there indeed is harassment.

Corruption and request for bribes was another issue highlighted as experienced in Kenya 45 per cent, Uganda 16 per cent and Tanzania 34 per cent.

Further discussions with government officials’ from the East Africa community in Tanzania revealed that the currency issue is a major problem because of the differences in the value and they also noted that their clients sometimes complain about it. For one to travel to either of the partner states they have to change their money into the currency of the country they are entering and this sometimes proves a cumbersome task.

Further, they acknowledged that there are issues related to tariffs differentiation that need to be addressed because this means for instance that the tax paid by Tanzanians in importing goods to Kenya is not the same in value with that of importing goods in Tanzania.

With the recent signing of the East African Common Market Protocol which will allow the free movement of labour, goods and services, it is hoped that some of the contentious issues in the report will be dealt with and the benefits will begin to trickle down to ordinary citizens.

What is the EAC?

  • The East African Community (EAC) is the regional intergovernmental organisation of the Republics of Kenya, Uganda, the United Republic of Tanzania, Republic of Rwanda and Republic of Burundi with its headquarters in Arusha, Tanzania.
  • The first attempt to create a regional block was initiated in the 19th century, culminating to the EA customs union in 1967. However, perceived inequality in the distribution of benefits, among other reasons, led to the collapse of the Community in 1977.
  • This spirit of integration was reviewed in 1993 in a tripartite Agreement involving Kenya, Uganda and Tanzania which created the East African Co-operation.
  • The Treaty for establishment of the East African Community was signed on November 30, 1999 and entered into force on July 7, 2000 following its ratification by the original three Partner States – Kenya, Uganda and Tanzania. Rwanda and Burundi acceded to the EAC Treaty on June 18, 2007 and became full Members of the Community with effect from July 1, 2007.
  • The EAC aims at widening and deepening co-operation among the Partner States in, among others, political, economic and social fields for their mutual benefit.
    The EAC countries established a Customs Union in 2005 and are working towards the establishment of a Common Market by 2010, subsequently a Monetary Union by 2012 and ultimately a Political Federation of the East African States.
    Complied by Mark Kirumira.