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Why EAC should be very afraid of the spat between presidents

Friday March 29 2019

By KWAME OWINO
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President Paul Kagame and President Yoweri Museveni are the most fluent rhetoricians within the East African Community in their argument for the place of economic growth in creating modern and strong states in this continent.

Their speeches both at home and abroad are replete with economic development numbers and their national ambitions. The two countries being landlocked, these leaders have a more pronounced regional economic posture than the remaining member states of the East African Community (EAC) club have shown. This shared need for access to the ports of Eastern Africa explain the exuberance towards regional economic cooperation.

But the economic logic of regional openness is under severe test now because the necessary access across the borders for traders from either country into the other is no longer assured. This situation confirms that for EAC countries, the logic of economic opportunity that integration portends will not suffice to keep borders open. EAC has been cited as an example because it has made fleeting progress but with the direction towards single market and monetary union being in the long term plans. Learning from the EU, it is evident that the single market is a worthy ambition but a monetary union would be a reckless experiment.

No watchers can now state unequivocally that the EAC’s successes will continue for the foreseeable future. It is evident that the EAC has many bumps that must be navigated and that the economic logic alone is not sufficient to keep its momentum going, no matter what the bureaucrats based in Arusha and member states may state. When the spat between the two presidents was started, one didn’t hear strong objections from business lobbies based inside the two countries urging the leaders to act more sensibly and in accordance with the rules contained in the treaty. Clearly, the economic rhetoric became secondary to the political reality.

COMMON MARKET

I have always argued that the best possible version of the EAC would be the culmination into a single market. This was informed by the belief that a political federation that puts together all five countries with different political styles and governance ethos would be a futile project to pursue. I still believe that but I am a little wiser that apart from the business lobbies that have connections in all countries and can speak a coherent language with each other, there is no active set of political interest groups vouching for the rationale for political coherence.

That is a big danger because when the political difference became so large that Uganda and Rwanda opted to take the beggar-thy-neighbour policies, there was zero political pushback within the home countries. It is not clear what the result of the intervention by Kenya’s president was but this visit did not result in a resolution. If the only people with a political interest in keeping the EAC project alive are the East African Legislative Assembly (EALA), their ineffectiveness in diplomacy during this moment shows that the EAC is far weaker than many people have imagined.

In spite of President Uhuru Kenyatta’s best attempts, the EAC has no political diplomats and was exposed for an interest group of business lobbies and bureaucrats serving their own purposes in Arusha and a legislative chamber that has ill-defined roles and influence in member countries.

Added to the fact that the last two Summit meetings of the EAC made no progress on the agenda, it appears the institution is caught in the same global surrender of multilateralism. This retreat of multilateralism globally is most salient in the fact that the World Trade Organization (WTO) has virtually abandoned the Doha Round with most states seeking regional and bilateral opportunities.

IMMINENT BREAKDOWN

This inward shift towards regional agreements is second-best in comparison to multilateralism but still beats an expensive breakdown akin to what the British are facing with Brexit. These tensions among the EAC states raise the probability of a breakdown that could precipitate departure of a single country because the EAC treaty also contemplates departure after a 12-month notice.

With the tit-for-tat witnessed at the borders of Uganda and Rwanda, it is unsettling that neither side could resort to the courts to restore the flow of goods. And it probably would not matter because even if the regional court had made a decision against one side, it would be ignored with no consequences for that defiance. This situation reveals that perhaps it requires nations with strong democratic credentials and independent institutions to sustain an ambitious regional trade arrangement as the EAC. These institutions require political craft to survive and this has been given short shrift. Can the political and social stakeholders of the EAC project stand up now?

Kwame Owino is the chief executive officer of the Institute of Economic Affairs (IEA-Kenya), a public policy think tank based in Nairobi.

Twitter: @IEAKwame