EAC should brace for ripple effect in its industrial sector
What you need to know:
With such a developmental crusade, one can only conclude, that partner states are per se in great harmony, pertaining development in political, economic and social key spheres with in the bloc
Co-operation within the East African Community is as widening as it is deepening. This comes with a great deal of advantage but with a downside too. It is of no doubt that the EAC is one of the fast growing regional economic blocs in the world.
The fact that, the Republic Rwanda consented to EAC treaty hence becoming a full member by July 1 2007, the Republic of South Sudan acceding to the treaty by April 15 2016 hence becoming a member by August 15, 2016, nine years later, and now, the recent consideration of the Democratic Republic of Congo’s application by the EAC Heads of State at its 21st Ordinary Meeting on February 27 2021, which saw an expeditious direction of a verification mission in accordance with EAC procedure for admission of new members, a mission which the DRC President, Felix Tshishekedi launched in June 2021. Only five years later after South Sudan.
Such developments and deliberate efforts among East African States truly point to a degree of unanimous harmony, geared towards regional development. A great thing. Because, this, if successful, opens up an additional 90 million population to the bloc’s current 177 million, a figure established as of 2019, creating a large and single common market in Africa.
With such a developmental crusade, one can only conclude, that partner states are per se in great harmony, pertaining development in political, economic and social key spheres with in the bloc.
This great EAC harmony, however, suggests a high likelihood of a ripple effect among member states. Countries adopting and assimilating policies and methodologies that have worked elsewhere into their own structures, judging by the fact that there are already harmonised EAC standards of products across the region.
The industry sector for instance, a sector that features mining, electricity, water and construction. In regions where its empowered, it has contributed enormously to the country’s Gross Domestic Product (GDP). In 2019/2020 for example, Uganda’s slow growth in the industry sector was attributed to poor performance in manufacturing activities, recording a 1.4 percent decline, slow growth of construction activities by 5.4 percent and a decline in mining and quarrying activities which declined by 2.8 percent, at a time when Tanzania through the Sustainable Management of Mineral Resources Project, strengthened its mineral sector, improved the socioeconomic impact of large-scale and small scale mining by addressing difficulty in identifying suitable geographical environments for artisanal miners, among other issues, making the sector yield 15.3 percent to the country’s GDP from January to March 2020 as per National Bureau of Statistics.
Economically, the ripple effect would be a great approach, in a way that, countries like Burundi whose industry sector contribution to GDP has retarded three times in the last five years with a 1.22 percent drop in 2016/2017, 0.15 percent in 2019/2018 and 0.28 percent drop in 2019/2020, Uganda’s, whose, five-year retardation happened twice, with 0.25 percent, 0.12 percent drops in 2016/2017 and 2019/2020 respectively, And Kenya’s, whose, five-year retardation occurred three times since 2016, with 0.1 percent, 0.38 percent and 0.26 percent drops save for 2020 which saw a 0.03 percent increase. These retarding countries, in good faith, will have to seek emulation of their counterparts Tanzania, Rwanda and South Sudan whose industry sector contribution to GDP has been gradually progressive given 2016-2020 statistics from Statista. Hence the ripple effect, giving birth to regional growth.
Conversely, however, due to effects of the ripple effect, firstly, partner states can get impacted by events occurring in another, especially, if they share a border, the way Ethiopia borders many East African countries than any other state or if a partner state is an important access point for both goods and people like Kenya is to other EAC states. Secondly, which among the partner states will likely become a regional hegemon, to exert an overly inflated influence upon others towards becoming a regional-economic driving force? As is the case for South Africa in Southern Africa, and Nigeria in West Africa over ECOWAS. Thirdly, Will the other neighbouring countries thrive if such a hegemonic partner state struggles? These are the reasons the EAC should brace itself over the ripple effect after effects.
Solomon A. Mutagaya
