East African Business Week

KAMPALA, UGANDA --July 1, 2011 marked one year since the launch of the EAC Common market. The common market is the second stage of regional integration and aims to implement the free movement of persons, workers, goods and services within the EAC.
The implementation of the common market hence entails removal of barriers to trade within the region, establishment of a common external tariff for foreign goods, as well as harmonization of partner states' laws regarding requirements for establishment of residence, employment, and trade to comply with the common market protocol.
Since the launch of the common market, the EAC partner states have engaged in negotiations to implement free movement of workers and services, with partner states making commitments regarding the protocol for example on opening up sections of the services sector like education and management, mutual recognition of academic qualifications and elimination of fees for work permits.
As regards movement of workers, it is only Kenya and Rwanda that have made more visible progress in this area. Rwanda has been more ambitious by eliminating work permits for workers from EAC member states while Kenya has waived fees on work permits. However, other member states countries are yet to make conclusive commitments on free movement of workers.
In line with the movement of goods, there has been some slight progress especially the establishment of a twenty-four hour operational boarder points. Another positive aspect of the common market has been increase in intra regional trade. According to Mr. David Nalo, Kenya's EAC permanent secretary, Kenya in particular registered a 13% increase in her exports to the EAC by the end of 2010.
However, according to the traders in Uganda, there are still unnecessary delays in clearing goods in transit at the border points, something that has hampered the free movement of goods and hence increasing the cost to traders of doing business.
Harmonization of the members' state laws to align them to the protocol as a prerequisite to foster implementation of the common market is yet to be realized among all the member states. For example, the customs union which precedes the common market provides for harmonization of domestic taxes such as Value Added Tax and excise taxes. However, even after launching the customs union in 2005, the partner states are yet to harmonize their internal tax rate which is another aspect that hinders progress of the common market. Full implementation of the Customs Union is key to making the Common Market work and this area needs much work at the moment.
The success of regional integration in general and the common market in particular is also largely dependent on the awareness raised among the citizenry in the community regarding the provisions in place and requirements for movement of persons that might need to seek residence in other partner states. Although efforts have been made by the states to raise awareness on this process; with Kenya in the lead, the EAC citizenry is largely ignorant of the ongoing processes and what they stand to gain from regional integration and the common market. In addition, the key players in this process including the youth, farmers and small scale traders, among others, still bear apathy towards the common market stemming from their fear of being out competed by citizens from across the region.
Furthermore, whereas commitments have been made regarding fostering of a common market in the EAC, these are clear on paper but the  reality on the ground one year later reflects minimal progress in implementation of the common market protocol. The partner states need to do a lot more in form of aligning national laws to the protocol, making more conclusive commitments on agreed sectors within the protocol annexes, raising awareness to involve stakeholders in this process. There is also need for more concerted effort towards eliminating non tariff barriers to facilitate the growth of intra regional trade as the implementation   of the Customs Union is key to making the Common Market work.
The common market is a critical stage of integration and if well harnessed is the cornerstone to the envisioned economic success of the EAC. Member states therefore need to fast track some of the areas that have registered low or no progress and ensure there is no time lost on the remaining issues if the objectives of the common market are to be realized in their true sense.

Jane Nalunga is the Country Director, SEATINI Uganda.