Common market second milestone in EAC's efforts toward economic integration

20:36, December 16, 2010      

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After years of hard negotiations and bargains, the East African Community (EAC) Common Market was formally launched on July 1, 2010, ushering in a single market with a combined population of 130 million and GDP of 73 billion U. S. dollars.

EAC consists of five member states: Kenya, Uganda, Tanzania, Burundi and Rwanda, with a development strategy of growing up from a Customs Union, a Common Market to a Monetary Union and eventually a Political Federation. It has already had a functional Customs Union which was established in January 2005.

The Common Market represents the second stage of the regional integration process and is a significant step toward the achievement of the next milestones in the integration process.


The overall objective of the EAC Common Market is to widen and deepen cooperation among the member states in the economic and social fields for the benefits of the member states and their citizens.

Specifically, the Common Market is supposed to accelerate economic growth and development of the member states through the attainment of the free movement of goods, persons and labor, the rights of establishment of residence and the free movement of services and capital.

The Common Market is to strengthen, coordinate and regulate the economic and trade relations among the member states so as to promote accelerated, harmonious and balanced development within the community.

It is also expected to sustain the expansion and integration of economic activities within the community, the benefit of which shall be equitably distributed among the member states, to promote common understanding and cooperation among the nationals of the member states for their economic and social development, and to enhance research and technological advancement to accelerate economic and social development.

In the protocol which established the Common Market, member states agreed to eliminate tariff, non tariff and technical barriers to trade, harmonize and mutually recognize standards and implement a common trade policy for the community, and ease cross- border movement of persons and adopt an integrated border management system.

For both businesses and consumers within the market, a single market is a very competitive environment, making the existence of monopolies more difficult which means that inefficient companies will suffer a loss of market share and may have to close down.

However, efficient firms can benefit from economies of scale, increased competitiveness and lower coasts.

The consumers are benefited in the sense that the competitive environment brings them cheaper products, more efficient providers of products and also increased choice of products. What is more, business in competition will innovate to create new products.

On the occasion of the commencement of the Common Market on July 1, 2010, EAC Secretary General Juma V. Mwapachu said the date was a historic one.

"Achieving successful negotiations leading up to the adoption of the Common Market Protocol, its approval by EAC heads of state and its ratification in record time is a milestone of the EAC. No other regional economic community in Africa has achieved such a milestone," the secretary general said.

"It is a milestone that epitomizes strong political will and firm commitment by all the EAC stakeholders in deepening and widening integration," he noted.

On the same occasion, Kenyan President Mwai Kibaki expressed optimism that levels of investment in the region would increase with the formal launch of the Common Market.

"The Common Market will lead to the free movement of labor, capital, goods and services within the region and open up employment opportunities for citizens of EAC member sates," the president said.

"The Common Market will avail greater opportunities for trade in goods and services."

To ensure the smooth transition, President Kibaki called for EAC member states to amend any local statutes that contradict to the Common Market Protocol.

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