East African Community Secretary General Dr. Peter Mathuki
NAIROBI, Jan 13 (NNN-KBC) — The East African Community (EAC) member states will have a single currency within the next four years (2027).
According to the EAC Secretary General Dr. Peter Mathuki, the Council of Ministers is expected to make a decision soon on the location of the East African Monetary Institute, the precursor to the East African Central Bank that will issue the single currency.
Addressing the media during a five-day retreat for all EAC Staff held at Maanzoni Lodge in Machakos County, the Secretary General said single currency will ease business and movement of persons within the block.
“The single currency will ease business and movement of persons within the region,” said Dr Mathuki.
Adding that: “It is in line with our goal to make the region borderless so that people can move and trade freely as envisioned in the Common Market Protocol.”
This even as the SG reported that the Intra-regional trade within the East African Community is on an upward trajectory, standing at US$10.17 billion in September 2022.
The intra-EAC trade, accounting for imports and exports in the seven EAC Partner States, grew from 13pc in 2019 at a value of $ 7.1 billion to 15pc in 2021 at a value of $9.5 billion.
By September 2022, the EAC trade value was recorded at $10.17 billion representing a 20pc share of Intra-trade to global trade.
EAC Secretary General Dr. Peter Mathuki attributed the increase in intra-regional trade to political goodwill among the members of the Summit of EAC Heads of State and the relaxation of Covid-19 restrictions in the region amongst other factors.
Dr. Mathuki said that high-level discussions among the Heads of State had eliminated many Non-Tariff Barriers (NTBs) hampering intra-regional trade and expressed hope that this and other factors would help raise the level of intra-regional trade in East Africa to at least 40pc over the next five years.
Dr. Mathuki disclosed that EAC’s total trade with the rest of the world stood at US$62 billion, adding that there was still room for improvement.
He said that following the High-Level Summit on the Common Market Protocol held in July 2022, the EAC is reviewing the issues impeding integration, adding that the issues would be discussed in the next Council of Ministers.
“257 NTBs have been cumulatively resolved since 2007. This is in tandem with the bloc’s goal to increase the volumes of intra-regional trade,” he said.
Dr. Mathuki further said that EAC Ministers/ Cabinet Secretaries in charge of Trade and Finance had adopted 35pc as the 4th Band of the EAC Common External Tariff (CET).
“From 1st July 2022, imports of locally available goods into the region; such as meat, furniture and textiles, have been attracting a tariff of 35pc. The move aims at promoting local production, value addition and industrialization,” said Dr. Mathuki, adding that the CET is one of the key instruments under the Customs Union pillar, which justifies regional integration through uniform treatment of goods imported from third parties.
On the directive by the Summit to the Council to follow up on the application by the Federal Republic of Somalia to join the Community, Dr. Mathuki said that the EAC is scheduled to send a verification mission to Somalia, at the end of this month, to assess the country’s readiness to join the Community.
Dr. Mathuki described Somalia’s long Indian Ocean Red Sea route that links Africa to the Arabian Peninsula as a vibrant economic zone saying that it will bring immense benefits for the EAC.
“The exploitation of Somalia’s blue economy resources such as fish and the expansive coastline is also set to boost the regional economy,” he said.
The Secretary-General said that EAC was keen on stabilising the Eastern region of the Democratic Republic of Congo, a process that he said requires a political solution that will be provided by the Heads of State.
On the EAC Political Federation, Dr. Mathuki said that national consultations for the EAC Political Confederation have so far been held for the Republics of Burundi and the Republic of Uganda.
“Plans are at an advanced stage to hold similar consultations for the United Republic of Tanzania, the Republic of Rwanda, the Republic of Kenya and the Republic of South Sudan in the 2022/2023 Financial Year,” he said. — NNN-KBC
