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Wednesday 16 June 2021
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East African leaders intensify steps towards barrier-free regional trade

East African leaders rose from a Summit on regional integration Friday, satisfied with the steps towards the formation of a Political Federation and the efforts to set up single revenue collection points.

The East African Community (EAC) Summit also agreed to sign the regional treaty to delay the launching of a single currency for the region by another 10 years while steps are taken towards the Federation.

“The Summit received a progress report on the operationalisation of the Single Customs Territory,” a communique issued at the end of the Summit stated. “The Summit noted that the Council of Ministers has developed a work plan and identified pillars that address free circulation of goods, revenue and the necessary institutional framework.”

The single customs territory seeks to have single revenue collection points across the five-member regional economic bloc.

They will also develop a single regional tax-collection body and agree on the modalities of collecting and transferring revenue collected on behalf of one territory through an electronic payment system.

An expert study on how the new system would operate recommends that it be set up either as a unified body within the national territories of each of the five states or link up all the national revenue bodies through technology.

EAC experts say the single customs union is the ultimate trade liberalization that the East African Community requires to boost regional trade through the removal of all restrictions on the free movement of goods.

If the proposals been considered by the regional ministerial committees are agreed upon, then each country would collect the debts owed to its EAC partners and would not enforce stringent rules of origin procedures.

“There would be no more requirement for strict bond controls and there would be no need to track consignments to ports of destination, allowing faster movement of goods and ultimately lowering the cost of doing business,” the EAC expert study on the single customs union stated.

The Summit noted that the High level task force negotiating the East African Monetary Union protocol had negotiated all the 77 articles on the draft protocol, but failed to agree on critical areas of economy.

They also failed to agree on the institutions required to effectively run the operations of the monetary union, whose creation they delayed by 10 years from the date of signing of the monetary union protocol.

Amongst the areas of disagreement have been issues of how to deal with economic weaknesses, lack of fiscal and financial discipline within the region and the failures that might result from state controls on central banks.

The talks were earlier meant to push through a monetary union by 2010. The new deadline of signing the protocol was set for December 2013.

“Given the outstanding work, the Summit directed the Council of ministers to expedite the negotiations towards the conclusion of the protocol and report progress at the 12th extra-ordinary Summit with a view to signing this protocol at the 15th Summit,” the communique stated.

Presidents Pierre Nkrunziza of Burundi, Mwai Kibaki of Kenya, who chaired the talks, Paul Kagame of Rwanda, Jakaya Kikwete of Tanzania and Yoweri Museveni of Uganda, attended the Summit.


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