Why the first EA Community collapsed

Sunday December 30 2012

The revival of the East African Community is one of the milestones marking our Uhuru jubilations. The new Community has a membership of five Partner States, from the original three that founded the EAC in 1967 and dissolved in 1977. The EAC has drawn lessons from successful regional economic communities elsewhere, but apparently, inadvertently or otherwise, there seems to have been no effort made to draw lessons from itself:

Prior to its collapse in 1977, the East African Community was one of the oldest and most prosperous Regional Economic Communities (RECs) in the world. Founded in 1967, by the three countries of Kenya, Tanzania and Uganda, it was an achievement of what had earlier failed in the run up to independence.

Britain, the colonial power in charge of the region then, had wanted to create a federation of the three East African states, a move that was opposed by Buganda in Uganda. Tanganyika had been keen on this federation, with its leader, Mwalimu Julius Nyerere, reported ready to delay the independence of Tanganyika, so that the region could attain independence as one federation. Earlier, in 1917, there existed a Customs Union between Uganda and Kenya, with Tanganyika joining it in 1927. This was followed by the East African High Commission that ran from 1948-1961; the East African Common Services Organisation (which became the foundation of the common undertakings) ran from 1961-1967.

In the theory of regional integration, the EAC of 1967-77 was already a Monetary Union, with a Currency Board, and a parity currency. A parity currency means that each country had its own currency, but converting at par: One Uganda Shillings equaled One Kenya Shilling and equaled One Tanzanian Shilling. Other areas of commonality included education.

The EAC was a success story, and at the time of its dissolution, several countries had applied to join the economic bloc. Various reasons have been advanced for the collapse of the old EAC. These have ranged from political differences especially between Uganda and Tanzania.

The actual collapse of the old EAC was occasioned by different levels of economic development, which meant Kenya taking a lion’s share of the EAC benefits, with the rest of the Partner States only importing from Kenya. This primus inter pares sense made Kenyan officials question the relevance of the East African Railways and Harbours being headquartered in Dar es Salaam, and the East African Posts and Telecommunications being in Kampala, while they had substantive ministries in Kenya in charge of these sectors.

One other crucial factor that seems to be better left buried is The Kampala Agreement. It sought to establish an even distribution of industries across the region, as a means of ensuring balanced development and mutual benefits from the Community. Each Partner State is trying to protect her turf.

Peter Twagira,
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