Introduction
The formation of the East African Community (EAC) in 1999 by the United Republic of Tanzania, the Republic of Kenya and the Republic of Uganda was the achievement of the trio’s cooperation since the collapse of the original EAC in 1977. Its aims are at widening and deepening co-operation among the Partner States in, among others, political, economic and social fields for their mutual benefit. To this extent the EAC countries established a Customs Union in 2005 and pledged to work towards the establishment of a Common Market by 2010, subsequently a Monetary Union by 2012 and ultimately a Political Federation of the East African States.
It is clear from the objectives that success has been limited, if the current achievements are anything to go by. So far, the East African Community has achieved the establishment of a common market, which has been plagued by disputes between the parties especially on the issue of movement of labor, the right to establishment and movement of capital. For example, Tanzania has in the past expelled Kenyan workers in an illegal immigrants purge. Kenya responded by accusing Tanzania of adopting policies that condone hostile actions against Kenyan citizens and their business interests.
The East African Community has also achieved the establishment of a customs union whose objective is formation of a single customs territory. Therefore, trade is at the core of the Customs Union. It is within this context that internal tariffs and non-tariff barriers that could hinder trade between the Partner States are expected to be eliminated, in order to facilitate formation of one large single market and investment area. Similarly, policies relating to trade between the Partner States and other countries, such as the external tariffs, have to be harmonized. This too has not been smooth. There has been a lack of understanding on trade terms between various countries in the region, such as Tanzania’s refusal to let Kenyan manufactured textiles into its territory and the restriction of Kenya’s confectionary goods into Tanzania and Uganda.
The 19th Ordinary summit of the Heads of State of the East African Community held in Kampala, Uganda to discuss a number of regional matters, including infrastructure and health sector growth. This article focuses on critiquing the areas of discussion during the summit in light of the challenges faced by the East African community in its quest to integrate and proposes solution and also provides a way forward for Kenya.
Basic Structure of the East African Community
The main Organs of the EAC are the Summit, the Council of Ministers, the Co-coordinating Committee, the Sectoral Committees, the East African Court of Justice, the East African Legislative Assembly and the Secretariat.
The Summit
The Summit comprising of Heads of Government of Partner States gives strategic direction towards the realization of the goal and objectives of the Community.
The Council of Ministers
The Council of Ministers is the central decision-making and governing organ of the EAC. Its membership constitutes Ministers or Cabinet Secretaries from the Partner States whose dockets are responsible for regional co-operation.
Every year, the Council meets twice, one meeting of which is held immediately preceding a meeting of the Summit. The Council meetings assist in maintaining a link between the political decisions taken at the Summits and the day-to-day functioning of the Community. Regulations, directives and decisions taken or given by the Council are binding to the Partner States and to all other Organs and Institutions of the Community other than the Summit, the Court and the Assembly.
The Council, each year, elects a Chairperson by rotation to serve a one-year term to the office of Chairperson of the Council of Ministers.
The Coordinating Committee
Under the Council, the Coordinating Committee has the primary responsibility for regional co-operation and co-ordinates the activities of the Sectoral Committees. It also recommends to the Council about the establishment, composition and functions of such Sectoral Committees. It draws its membership from Permanent / Principal Secretaries responsible for regional co-operation from the Partner States.
Subject to any directions given by the Council, the Coordinating Committee meets twice a year preceding the meetings of the Council. Moreover, it may hold extraordinary meetings at the request of the Chairperson of the Coordinating Committee.
Sectoral Committees
Sectoral Committees conceptualize programs and monitor their implementation. The Council establishes such Sectoral Committees on recommendation of the Coordinating Committee.
The Sectoral Committees meet as often as necessary for the proper discharge of their functions.
The East African Court of Justice
The East African Court of Justice (or simply, the Court) is the principal judicial organ of the Community and ensures adherence to the law in the interpretation and application of compliance with the EAC Treaty. It was established under Article 9 of the Treaty for the Establishment of the East African Community.
Arusha, Tanzania is the temporary seat of the Court until the Summit determines its permanent seat. The Court established its Sub-registries in the Partner States, which are located in the premises of the National Courts.
The Court is currently composed of ten judges, appointed by the Summit from among sitting judges of any Partner State court of judicature or from jurists of recognized competence, and the Registrar who is appointed by the Council of Ministers.
The Court has two divisions: an Appellate division and a First Instance division.
The East African Legislative Assembly
The East African Legislative Assembly (EALA) is the Legislative Organ of the Community and has a cardinal function to further EAC objectives, through its Legislative, Representative and Oversight mandate. It was established under Article 9 of the Treaty for the Establishment of the East African Community.
The Assembly has a membership comprising of 45 elected Members (nine from each Partner State), and 7 ex-officio Members consisting of the Minister or Cabinet Secretary responsible for EAC Affairs from each Partner State, the Secretary-General and the Counsel to the Community totaling 52 Members.
The Assembly draws the authority to establish its Standing Committees from its Rules of Procedure. It currently has 6 Standing Committees to execute its mandate:
The EALA Commission which oversees the management of the Assembly is established following the enactment of the Administration of the EALA Act 2012.
The Secretariat
The Secretariat is the executive Organ of the Community. As the guardian of the Treaty, it ensures that regulations and directives adopted by the Council are properly implemented. In service of the Community, the Secretariat comprises the Secretary-General, 4 Deputy Secretaries-General, the Counsel to the Community and hundreds of EAC staff members who carry out the day-to-day work of the EAC as mandated by the Council.
The Secretary-General is the principal executive and accounting officer of the Community, the head of the Secretariat and the Secretary of the Summit; he/she is appointed by the Summit for a fixed five-year, non-renewable term.
The Deputy Secretaries-General are appointed by the Summit on recommendations of the Council and on a rotational basis. They deputise the Secretary-General and each serves a three-year term, renewable once.
The Counsel to the Community is the principal legal adviser to the Community.
Background of the Summit and Issues Deliberated
Leaders of the East African Community during the summit showed commitment to ensure sustainable development of the region. This is shown from the theme and content of discussion during the summit meeting. The theme of discussion was “Enhancing Socio-Economic Development for Deeper Integration of the Community”. The main objective and purpose of the Summit was to provide the political support and impetus to the East African Community Regional Integration process and agenda. It also included taking stock of the implementation of directives made at previous summits.
Key issues they deliberated on during the summit under the above theme were on investment areas for health, priority infrastructural projects, sustainable financing mechanism for the EAC, and progress on political federation and monetary union.
In addressing the investment areas, the leaders, among other things, agreed on a number of issues. First, they prioritized investment in health and directed the partner states to mobilize resources required to support health investments within the region.
Healthcare in East Africa remains expensive partly due to the consistent underfunding of the health sector by the respective governments as shown in the graphical representation below
Source: EAC Countries Ministries of Health, EAC Countries Budget Speeches 2012-2015
The leaders through the joint communiqué granted by the Eat African Community noted that key in their health investment agenda is capacity building through development of skills, infrastructure and building of a referral network that ensures a cross boarder skills exchange.
Infrastructure is important to facilitate development in the region. In light of that, the summit directed the council to mobilize resources required for implementation of new and on-going priority infrastructure projects in the region. Some of the key priority areas of investment are railways, road networks, aviation, and communication. The overall objectives of developing infrastructure within the region, as noted by the leaders of the region, is to facilitate trade within the East African region and within the larger Tripartite Transport and Transit Facilitation Program .
Leaders also identified industries of mutual development. These include areas of health, cotton, textile, apparel and leather and the automotive industries among others. The Summit sought to make the region more competitive, increase employment and reduce overreliance on imports by prioritizing the development of competitive domestic industries.
On finance, the Summit received a report on the review of the East African Development Bank (EADB) to streamline it into the EAC main structure and another on sustainable financing mechanism for the East African Community. Sustainable financing has been viewed as specifically important in light of the various grand projects and the resource gap individual partner states have. Based on research, Burundi has the greatest resource gap at 20% of its GDP; Uganda has a gap equivalent to 8.5% of GDP; Tanzania 7.1%; Rwanda 6.6% and Kenya has a significantly lower resource gap of only 2.9% of GDP .
On the issue of integration, the summit gave impetus towards achievement of the EAC objectives by directing the council and partner states to fully implement the single customs territory. To facilitate the implementation, the summit directed the partner states to expedite the amendment of their respective national legal framework to ensure they comply with the common market protocol.
The summit directed the council to expedite the establishment of the monetary institute and other institutions according to the roadmap of the east African monetary union.
The summit received a report on European Economic Partnership (EU-EAC EPA) and decided that the EAC continues to engage with the EU for satisfactory clarification of concerns of some partner states on the EPAs. The chair of summit was mandated to follow up on this matter and in the event that an acceptable way forward is not reached, the community shall explore the use of variable geometry in the implementation of EPAs.
A view of the above issues deliberated leads one to question what way the EAC is headed in light of the challenges that have manifested as disputes between member states. One would expect that a system of interpretation and implementation of the treaty to be established in order to see to it that the realization of the objectives of integration are met.
Sustainable development and joint investment programs are important, only to the extent that each partner is on the same page and reads from the same script. The leaders ought to learn from history, and it shows that the EAC has collapsed before largely because of the ideological differences between partner states and a lack of understanding of the EAC objectives.
Conclusion: Challenges Facing the East African Community
In my analysis, three major challenges plague the East African Community that prevent it from meeting its objectives of further integration:
Chapter six of the EAC Treaty lays down the fundamental principles designed to govern the achievement of the goals of the regional bloc by partner states. These include mutual trust, political will and sovereign equality. What matters in the establishment of a political and monetary union is political will. As a key ingredient, it is safe to say that it is lacking.
The East African Community set its ambitious goals of established a Customs Union in 2005, Common Market by 2010, subsequently a Monetary Union by 2012 and ultimately a Political Federation of the East African States. Fast forward to the year 2018, a Monetary Union seems like mirage let alone a political union. A lack of political union manifest in as a zero sum zero-sum race for the infrastructure corridor of the EAC between Kenya and Tanzania. Kenya is said to have lost that race, when Kigali and Kampala abandoned the previously agreed rail and pipeline routing through Kenya for the Tanzanian alternative.
Also, in foreign policy, the Community is sharply divided: Rwanda and Kenya have signed the Economic Partnership Agreement with the European Union while Tanzania and Uganda are holding out, citing national interest. Burundi is under EU sanctions, and is presumably EPA-ineligible as a result. When the talks with the EU began, South Sudan was not a member of the bloc.
Treaties recognize that in the course of engagement, dispute may arise and therefore anticipate the resolution of disputes through articles in the treaty that set a dispute resolution mechanism. The EAC treaty lacks a dispute resolution mechanism. The effect has been a lack of a uniform interpretation of the treaty and the highly publicized disputes between member states. This has had a negative effect on efforts to interrelate.
National interest has proven to be a constraint in integration efforts. East Africa has been dysfunctional in its implementation of joint programs as decisions are made yet individual states select whether to implement the programs or not. This manifests in several policies adopted by individual states that affect their neighboring states. Such include, as previously stated, Tanzania’s and a lack of coordination in various joint infrastructural projects within the region.
Recommendation: Way Forwards for Kenya
Kenya needs to manage the risks posed by the erratic nature of its neighbors. This means that it should be more prepared to work with its neighbors and also look outside the east African community to foster growth.
In looking inwards within the community, Kenya should leverage on its comparative advantage which exists in its infrastructure and investment attraction to bargain for better terms within the EAC.
In leveraging on its comparative advantage, Kenya may play an important part in resource mobilization and alternative financing aimed at financing socio-economic development projects such as infrastructure and health, Kenya may position itself as a center of finance in the region. With well-developed financial institutions such as the stock exchange and banks, and Nairobi’s recognition as a financial hub. This and the fact that its industries and infrastructure are better advanced than any other country in east Africa means that if well exploited, it could use them in their bargaining for better terms within the treaty.
Putting all its eggs in the EAC basket could also turn tragic for Kenya. Currently, it is highly dependent on inter EAC trade for export of its goods. As of 2017, Kenya overall contributed to an average share of over 40 per cent of total intra-EAC trade and enjoyed a trade surplus with its EAC partners. However, figures show that Kenya’s trade with is partners has steady declined over the years. This marks a need to seek more trade partners outside the region who may be interested in Kenya’s goods.
Link to the Joint Communique: 19th Ordinary Summit of Heads of State of The East African Community
Kenya has benefited from its relations with the world. Multilateral, plurilateral or bilateral relationships with other countries has increased Kenyan firms and individuals market access, peace cooperations, import sources and aid. Kenya has trade relations with the United State of America and the Islamic Republic of Iran. One of the most consequential relationships between the […]
The National Infrastructure Fund Act (No. 4 of 2026) took effect on 25 March 2026 with a headline financing target: to raise about Ksh 5 trillion over ten years for highways, railways, ports, energy, information and communications technology, water and irrigation. The plan works like this. Privatization proceeds become the Fund’s starting capital. That capital […]
Introduction The matatu metaphor can be used to analytically frame Kenya’s budget as a system that is subject to binding constraints, evolving expectations, and continuous adjustment to shocks. Like the matatu sector, fiscal policy reflects a balancing act between efficiency and quick action seeking to respond to public service delivery while constrained by competing sector […]
Introduction Imagine paying the same fare to travel at 6 a.m. as you would at 6 p.m., even though the matatu is half-empty in the morning and packed in the evening. At 6 a.m., there may be more seats available than passengers willing to pay for them. By 6 p.m., the situation is reversed. Hundreds […]
Absurd hypotheticals are useful precisely because they stress-test a system until its constraints become visible. This note asks what would break first if SpaceX, now a public company following its record-breaking Nasdaq debut in June 2026, with a post-IPO market value of approximately US$ 2.5 trillion, sought a secondary cross-listing on the Nairobi Securities Exchange. […]
| Post date: Mon, Sep 3, 2018 |
| Category: International Trade |
| By: Edwin Njoroge, |
Introduction
The formation of the East African Community (EAC) in 1999 by the United Republic of Tanzania, the Republic of Kenya and the Republic of Uganda was the achievement of the trio’s cooperation since the collapse of the original EAC in 1977. Its aims are at widening and deepening co-operation among the Partner States in, among others, political, economic and social fields for their mutual benefit. To this extent the EAC countries established a Customs Union in 2005 and pledged to work towards the establishment of a Common Market by 2010, subsequently a Monetary Union by 2012 and ultimately a Political Federation of the East African States.
It is clear from the objectives that success has been limited, if the current achievements are anything to go by. So far, the East African Community has achieved the establishment of a common market, which has been plagued by disputes between the parties especially on the issue of movement of labor, the right to establishment and movement of capital. For example, Tanzania has in the past expelled Kenyan workers in an illegal immigrants purge. Kenya responded by accusing Tanzania of adopting policies that condone hostile actions against Kenyan citizens and their business interests.
The East African Community has also achieved the establishment of a customs union whose objective is formation of a single customs territory. Therefore, trade is at the core of the Customs Union. It is within this context that internal tariffs and non-tariff barriers that could hinder trade between the Partner States are expected to be eliminated, in order to facilitate formation of one large single market and investment area. Similarly, policies relating to trade between the Partner States and other countries, such as the external tariffs, have to be harmonized. This too has not been smooth. There has been a lack of understanding on trade terms between various countries in the region, such as Tanzania’s refusal to let Kenyan manufactured textiles into its territory and the restriction of Kenya’s confectionary goods into Tanzania and Uganda.
The 19th Ordinary summit of the Heads of State of the East African Community held in Kampala, Uganda to discuss a number of regional matters, including infrastructure and health sector growth. This article focuses on critiquing the areas of discussion during the summit in light of the challenges faced by the East African community in its quest to integrate and proposes solution and also provides a way forward for Kenya.
Basic Structure of the East African Community
The main Organs of the EAC are the Summit, the Council of Ministers, the Co-coordinating Committee, the Sectoral Committees, the East African Court of Justice, the East African Legislative Assembly and the Secretariat.
The Summit
The Summit comprising of Heads of Government of Partner States gives strategic direction towards the realization of the goal and objectives of the Community.
The Council of Ministers
The Council of Ministers is the central decision-making and governing organ of the EAC. Its membership constitutes Ministers or Cabinet Secretaries from the Partner States whose dockets are responsible for regional co-operation.
Every year, the Council meets twice, one meeting of which is held immediately preceding a meeting of the Summit. The Council meetings assist in maintaining a link between the political decisions taken at the Summits and the day-to-day functioning of the Community. Regulations, directives and decisions taken or given by the Council are binding to the Partner States and to all other Organs and Institutions of the Community other than the Summit, the Court and the Assembly.
The Council, each year, elects a Chairperson by rotation to serve a one-year term to the office of Chairperson of the Council of Ministers.
The Coordinating Committee
Under the Council, the Coordinating Committee has the primary responsibility for regional co-operation and co-ordinates the activities of the Sectoral Committees. It also recommends to the Council about the establishment, composition and functions of such Sectoral Committees. It draws its membership from Permanent / Principal Secretaries responsible for regional co-operation from the Partner States.
Subject to any directions given by the Council, the Coordinating Committee meets twice a year preceding the meetings of the Council. Moreover, it may hold extraordinary meetings at the request of the Chairperson of the Coordinating Committee.
Sectoral Committees
Sectoral Committees conceptualize programs and monitor their implementation. The Council establishes such Sectoral Committees on recommendation of the Coordinating Committee.
The Sectoral Committees meet as often as necessary for the proper discharge of their functions.
The East African Court of Justice
The East African Court of Justice (or simply, the Court) is the principal judicial organ of the Community and ensures adherence to the law in the interpretation and application of compliance with the EAC Treaty. It was established under Article 9 of the Treaty for the Establishment of the East African Community.
Arusha, Tanzania is the temporary seat of the Court until the Summit determines its permanent seat. The Court established its Sub-registries in the Partner States, which are located in the premises of the National Courts.
The Court is currently composed of ten judges, appointed by the Summit from among sitting judges of any Partner State court of judicature or from jurists of recognized competence, and the Registrar who is appointed by the Council of Ministers.
The Court has two divisions: an Appellate division and a First Instance division.
The East African Legislative Assembly
The East African Legislative Assembly (EALA) is the Legislative Organ of the Community and has a cardinal function to further EAC objectives, through its Legislative, Representative and Oversight mandate. It was established under Article 9 of the Treaty for the Establishment of the East African Community.
The Assembly has a membership comprising of 45 elected Members (nine from each Partner State), and 7 ex-officio Members consisting of the Minister or Cabinet Secretary responsible for EAC Affairs from each Partner State, the Secretary-General and the Counsel to the Community totaling 52 Members.
The Assembly draws the authority to establish its Standing Committees from its Rules of Procedure. It currently has 6 Standing Committees to execute its mandate:
The EALA Commission which oversees the management of the Assembly is established following the enactment of the Administration of the EALA Act 2012.
The Secretariat
The Secretariat is the executive Organ of the Community. As the guardian of the Treaty, it ensures that regulations and directives adopted by the Council are properly implemented. In service of the Community, the Secretariat comprises the Secretary-General, 4 Deputy Secretaries-General, the Counsel to the Community and hundreds of EAC staff members who carry out the day-to-day work of the EAC as mandated by the Council.
The Secretary-General is the principal executive and accounting officer of the Community, the head of the Secretariat and the Secretary of the Summit; he/she is appointed by the Summit for a fixed five-year, non-renewable term.
The Deputy Secretaries-General are appointed by the Summit on recommendations of the Council and on a rotational basis. They deputise the Secretary-General and each serves a three-year term, renewable once.
The Counsel to the Community is the principal legal adviser to the Community.
Background of the Summit and Issues Deliberated
Leaders of the East African Community during the summit showed commitment to ensure sustainable development of the region. This is shown from the theme and content of discussion during the summit meeting. The theme of discussion was “Enhancing Socio-Economic Development for Deeper Integration of the Community”. The main objective and purpose of the Summit was to provide the political support and impetus to the East African Community Regional Integration process and agenda. It also included taking stock of the implementation of directives made at previous summits.
Key issues they deliberated on during the summit under the above theme were on investment areas for health, priority infrastructural projects, sustainable financing mechanism for the EAC, and progress on political federation and monetary union.
In addressing the investment areas, the leaders, among other things, agreed on a number of issues. First, they prioritized investment in health and directed the partner states to mobilize resources required to support health investments within the region.
Healthcare in East Africa remains expensive partly due to the consistent underfunding of the health sector by the respective governments as shown in the graphical representation below
Source: EAC Countries Ministries of Health, EAC Countries Budget Speeches 2012-2015
The leaders through the joint communiqué granted by the Eat African Community noted that key in their health investment agenda is capacity building through development of skills, infrastructure and building of a referral network that ensures a cross boarder skills exchange.
Infrastructure is important to facilitate development in the region. In light of that, the summit directed the council to mobilize resources required for implementation of new and on-going priority infrastructure projects in the region. Some of the key priority areas of investment are railways, road networks, aviation, and communication. The overall objectives of developing infrastructure within the region, as noted by the leaders of the region, is to facilitate trade within the East African region and within the larger Tripartite Transport and Transit Facilitation Program .
Leaders also identified industries of mutual development. These include areas of health, cotton, textile, apparel and leather and the automotive industries among others. The Summit sought to make the region more competitive, increase employment and reduce overreliance on imports by prioritizing the development of competitive domestic industries.
On finance, the Summit received a report on the review of the East African Development Bank (EADB) to streamline it into the EAC main structure and another on sustainable financing mechanism for the East African Community. Sustainable financing has been viewed as specifically important in light of the various grand projects and the resource gap individual partner states have. Based on research, Burundi has the greatest resource gap at 20% of its GDP; Uganda has a gap equivalent to 8.5% of GDP; Tanzania 7.1%; Rwanda 6.6% and Kenya has a significantly lower resource gap of only 2.9% of GDP .
On the issue of integration, the summit gave impetus towards achievement of the EAC objectives by directing the council and partner states to fully implement the single customs territory. To facilitate the implementation, the summit directed the partner states to expedite the amendment of their respective national legal framework to ensure they comply with the common market protocol.
The summit directed the council to expedite the establishment of the monetary institute and other institutions according to the roadmap of the east African monetary union.
The summit received a report on European Economic Partnership (EU-EAC EPA) and decided that the EAC continues to engage with the EU for satisfactory clarification of concerns of some partner states on the EPAs. The chair of summit was mandated to follow up on this matter and in the event that an acceptable way forward is not reached, the community shall explore the use of variable geometry in the implementation of EPAs.
A view of the above issues deliberated leads one to question what way the EAC is headed in light of the challenges that have manifested as disputes between member states. One would expect that a system of interpretation and implementation of the treaty to be established in order to see to it that the realization of the objectives of integration are met.
Sustainable development and joint investment programs are important, only to the extent that each partner is on the same page and reads from the same script. The leaders ought to learn from history, and it shows that the EAC has collapsed before largely because of the ideological differences between partner states and a lack of understanding of the EAC objectives.
Conclusion: Challenges Facing the East African Community
In my analysis, three major challenges plague the East African Community that prevent it from meeting its objectives of further integration:
Chapter six of the EAC Treaty lays down the fundamental principles designed to govern the achievement of the goals of the regional bloc by partner states. These include mutual trust, political will and sovereign equality. What matters in the establishment of a political and monetary union is political will. As a key ingredient, it is safe to say that it is lacking.
The East African Community set its ambitious goals of established a Customs Union in 2005, Common Market by 2010, subsequently a Monetary Union by 2012 and ultimately a Political Federation of the East African States. Fast forward to the year 2018, a Monetary Union seems like mirage let alone a political union. A lack of political union manifest in as a zero sum zero-sum race for the infrastructure corridor of the EAC between Kenya and Tanzania. Kenya is said to have lost that race, when Kigali and Kampala abandoned the previously agreed rail and pipeline routing through Kenya for the Tanzanian alternative.
Also, in foreign policy, the Community is sharply divided: Rwanda and Kenya have signed the Economic Partnership Agreement with the European Union while Tanzania and Uganda are holding out, citing national interest. Burundi is under EU sanctions, and is presumably EPA-ineligible as a result. When the talks with the EU began, South Sudan was not a member of the bloc.
Treaties recognize that in the course of engagement, dispute may arise and therefore anticipate the resolution of disputes through articles in the treaty that set a dispute resolution mechanism. The EAC treaty lacks a dispute resolution mechanism. The effect has been a lack of a uniform interpretation of the treaty and the highly publicized disputes between member states. This has had a negative effect on efforts to interrelate.
National interest has proven to be a constraint in integration efforts. East Africa has been dysfunctional in its implementation of joint programs as decisions are made yet individual states select whether to implement the programs or not. This manifests in several policies adopted by individual states that affect their neighboring states. Such include, as previously stated, Tanzania’s and a lack of coordination in various joint infrastructural projects within the region.
Recommendation: Way Forwards for Kenya
Kenya needs to manage the risks posed by the erratic nature of its neighbors. This means that it should be more prepared to work with its neighbors and also look outside the east African community to foster growth.
In looking inwards within the community, Kenya should leverage on its comparative advantage which exists in its infrastructure and investment attraction to bargain for better terms within the EAC.
In leveraging on its comparative advantage, Kenya may play an important part in resource mobilization and alternative financing aimed at financing socio-economic development projects such as infrastructure and health, Kenya may position itself as a center of finance in the region. With well-developed financial institutions such as the stock exchange and banks, and Nairobi’s recognition as a financial hub. This and the fact that its industries and infrastructure are better advanced than any other country in east Africa means that if well exploited, it could use them in their bargaining for better terms within the treaty.
Putting all its eggs in the EAC basket could also turn tragic for Kenya. Currently, it is highly dependent on inter EAC trade for export of its goods. As of 2017, Kenya overall contributed to an average share of over 40 per cent of total intra-EAC trade and enjoyed a trade surplus with its EAC partners. However, figures show that Kenya’s trade with is partners has steady declined over the years. This marks a need to seek more trade partners outside the region who may be interested in Kenya’s goods.
Link to the Joint Communique: 19th Ordinary Summit of Heads of State of The East African Community
Kenya has benefited from its relations with the world. Multilateral, plurilateral or bilateral relationships with other countries has increased Kenyan firms and individuals market access, peace cooperations, import sources and aid. Kenya has trade relations with the United State of America and the Islamic Republic of Iran. One of the most consequential relationships between the […]
The National Infrastructure Fund Act (No. 4 of 2026) took effect on 25 March 2026 with a headline financing target: to raise about Ksh 5 trillion over ten years for highways, railways, ports, energy, information and communications technology, water and irrigation. The plan works like this. Privatization proceeds become the Fund’s starting capital. That capital […]
Introduction The matatu metaphor can be used to analytically frame Kenya’s budget as a system that is subject to binding constraints, evolving expectations, and continuous adjustment to shocks. Like the matatu sector, fiscal policy reflects a balancing act between efficiency and quick action seeking to respond to public service delivery while constrained by competing sector […]
Introduction Imagine paying the same fare to travel at 6 a.m. as you would at 6 p.m., even though the matatu is half-empty in the morning and packed in the evening. At 6 a.m., there may be more seats available than passengers willing to pay for them. By 6 p.m., the situation is reversed. Hundreds […]
Absurd hypotheticals are useful precisely because they stress-test a system until its constraints become visible. This note asks what would break first if SpaceX, now a public company following its record-breaking Nasdaq debut in June 2026, with a post-IPO market value of approximately US$ 2.5 trillion, sought a secondary cross-listing on the Nairobi Securities Exchange. […]