Date: Mon, 30 Jul 2007

REGIONAL INTEGRATION AND DEVELOPMENT: THE DYNAMICS OF EXPANSION AND THE FAST TRACKING OF THE EAST AFRICAN FEDERATION

Speech by Amb. Dr. Juma V. Mwapachu, Secretary General of the East African Community to the East African Universities students attending the East African Uongozi Institute for the Year 2007

TAUSI HALL, ARUSHA INTERNATIONAL CONFERENCE CENTRE, ARUSHA, 26 July 2007

By Leo Odera Omolo
In Arusha-Tanzania

I am pleased to address this group of young East Africans attending the East African Uongozi Institute School for the year of 2007. I would like to thank the organisers of this important annual programme for the interest consistently shown in the East African Community.

As an East African Institute, this collaboration is imperative and we need to investigate how best we can transform this Institute into an EAC Centre of Excellence on issues of governance, human rights and development.

The topic you have requested me to address: Regional Integration and Development: The Dynamics of Enlargement and the Fast Tracking of the East African Federation is highly topical. It seeks, on the one hand, a discussion on the impact of enlargement on the integration agenda with its focus on development. It also seeks to contextualize, on the other hand, the debate and the vision of a political federation in the regional integration agenda, a rather fuzzy idea but important anyhow in the light of an uninformed perception that has emerged that a negative response on fast tracking political federation may damage the fundamental building blocks of deeper integration.

Allow me to begin my remarks by examining the basic question in the topic, namely integration and development. This question is important of itself; in other words, important even without considering the dynamics that impact it as a result of enlargement of the EAC and of fast tracking the process towards political federation or, as others have put it, fast tracking political federation.

I have been criticized in some East African literary quarters for distinguishing the two “fast trackings” “as not being semantic ”. My critics posit that my distinction is in fact semantic; meaning that they do not see the difference. Maybe I should use this occasion to clarify my view of the distinction. Fast tracking the process towards a political federation puts emphasis, in my view, on fast tracking the Customs Union, the Common Market and the Single Currency in order to realize the Political Federation – much faster. I believe that this view lay at the heart of the decision of the EAC Heads of State taken in 2004 that led to the appointment of the Wako Committee. The Wako Committee thus recommended the compression of time in EAC’s quest to realize the different stages of integration with a view to enabling the faster realization of a political federation.

Fast tracking the political federation, on the other hand, has regrettably, again in my humble view, been interpreted, in several quarters in the public domain, especially in Tanzania, to “seek ye first the political kingdom and all other things shall be added unto it.”- The Kwame Nkrumah thesis.

Is my distinction therefore semantic? I leave it to your judgment.

Now let me revert to the basic question about integration and development. I said that this is an important question and I will explain why. In his speech at the OAU Summit in Cairo in July 1964, the late Mwalimu Julius Nyerere said, in the context of Africa , and I quote: “The major problems that we now face as a continent, whether united or Balkanized is one of development. It is the problem of realizing the standards of living of our people, to a level that is considered reasonable in terms of the possibilities of this scientific age”. Nyerere seemed to say that development is paramount with or without integration. However, in March 1965 Nyerere wrote in the First issue of the magazine, African Forum that “if we (Africans) remain separate it will take an intolerably long time before our economic growth be such as to bring the standard of living of our people to acceptable levels”.

On the surface, therefore, integration would infer higher development than what is achievable under a state of balkanization. Yet in the same 1964 Cairo speech, Nyerere had posited, in the context of East Africa , that a Common Market, a higher stage of integration, is meaningless unless it can be equally exploited by all those who form it. The Common Market that existed then, in East Africa, was what East Africa inherited from the East African Common Services Organization, a colonial legacy. In other words, then, integration has to promote social and economic equity. For us in the EAC, this is the fundamental challenge; how to ensure that the Customs Union and the Common Market now under formulation, create a win-win environment and build economies and societies that equally share the costs and benefits of integration. It is this philosophy of equity that informed the Treaty for East African Cooperation of 1967. But this challenge is now greater following the EAC enlargement.

However, it is also important to note that the challenge of equity is made more formidable in an environment where globalization unleashes new rules of trade, environment, health standards and competition. This is an environment where the Most Favoured Nation (MFN) arrangement, which underpins regional integration systems, is being put to question by the WTO. The question that emerges is whether growing multilateralism will undermine regional integration and thus the kind of higher development envisaged in integration mechanisms. This is a question for all of us to ponder. There are no easy answers.

Suffice to state though, that the development dimension linked to integration is reinforced by what Nyerere described, in 1977 as the “trade union of the poor.” Integration clearly enhances the scope and leverage of negotiating power at the global level. This is the reason why the WTO last year described the EAC as the most successful illustration of regional integration in Africa . Our working Customs Union has leveraged this position and the accolades showered upon us because it ensures a coordinated trade policy, with a well structured and operating CET. The introduction of Standards, Quality, Metrology and Testing law, as well as the Competition law, as part of the EAC legal regime, have bolstered our collective strength vis-à-vis third parties. Moreover, the growth of an enlarged market acts as a spur for promoting EAC investments and attracting FDI.

What we must take care against is for our integration through the Customs Union and later the Common Market leading to a fortress EAC where trade diversion, in other words, competitively lower cost imports from third parties are displaced, becomes the dominant feature rather than trade creation. Evidently, the EAC, as an integration project, will be able to be a competitive trade creator, not diverter, where and when it promotes competition and develops the infrastructures (energy, roads, railways, telecom, civil aviation, ports and harbours) that unlock the supply-side constraints for improved production and achievement of higher levels of productivity. Integration becomes synonymous with development when these economic objectives are focused upon and implemented.

I will now turn to examining the second part of the topic before us, namely the impact of enlargement on the integration agenda with specific focus on the dynamics of enlargement and of fast tracking the process towards political federation.

EAC needs to show greater imagination and thinking about how the enlarged EAC will function. There is little doubt that enlargement and the greater diversity it fosters will strain the current EAC decision making structure and process. Evidently, enlargement will precipitate qualitative change in EAC’s ambitions, its responsibility and, above all, it will precipitate political dynamics. Let me ramify these points with a number of examples. First, the enlarged EAC will become a more ambitious institution in Africa and in our relations with the AU, the EU and the WTO. Its bigger size should surely leverage its negotiation capacity as earlier alluded to.

But, secondly, enlargement will also result in new responsibilities for the EAC. Whereas Rwanda has succeeded to come out of the era of tragic genocide and is on an economic growth path, Burundi poses some challenges to the EAC – challenges of development, security and stability. It is difficult not to anticipate these security threats. After all, they still bedevil even the core members of the EAC, i.e. Kenya , Uganda and Tanzania .

I need not over emphasize the spate of cross-border violent crime taking place in our region, recently in Uganda , and here in Tanzania involving the NMB robbery in Mwanga which led to a wild-west type of shoot-out, but with modern weapons being used at Njiro in Arusha Municipality .

Thus whilst a critical dynamic of EAC’s enlargement centres on bringing Rwanda and Burundi into the development policy sphere of the EAC, a critical one relates to the security policy sphere. Defence and police cooperation will thus constitute an important and urgent area of cooperation to be structured and enforced.

Thirdly, and in connection with political dynamics arising out of enlargement, there is the fundamental question about how the EAC makes its decisions. As you may know, as per the Treaty, EAC’s decisions are based on consensus or unanimity. If this process has been a challenge for three Partner States, you can understand what would face the EAC with five Partner States.

Effectively integrating five countries into the EAC’s various policies and programmes will crucially hinge on the ability and willingness of the Partner States to be committed to such policies and programmes. You can inevitably expect greater diversity of views, perceptions and interests on various policy matters much as Rwanda and Burundi made commitments to accept current policy positions as part of their Accession Treaties.

The ideal situation is for the EAC to review its present decision making system based on consensus and shift to a qualified majority voting system. In other words, policies that are politically sensitive to the Partner States should be left for consensus or unanimity decision, whilst those that are not politically sensitive should be decided upon based on majority decisions.

The EAC must, at all costs, avoid a gridlock in its decision making system. Let me also emphasize that this political dynamic takes a more critical dimension where a Partner State fails to attend a meeting where a decision is to be taken.

The meeting becomes ineffectual. Not only would such outcome be dysfunctional to the development of the EAC; it would also prove costly to the Partner States which bring Officers and Ministers to Arusha and elsewhere for meetings.

The EAC could learn from the EU in this critical issue. In the EU, Member States do not have to reach decisions on consensus on some key policy matters. For example, the UK is not part of Shengen, the European Visa system.

The UK and few other EU member states are also not partakers in the Eurozone.

But such exception, what you can call ala carte choices, does not necessarily harm the EU. Even in the WTO, there are no uniform or one type of agreements tying every member. In fact, there are two major types of agreements: one that is multilateral which covers everybody and the other is plurilateral which covers only those countries that decide to participate in those agreements.

For example liberalization of telecommunications is a plurilateral issue. This flexibility of decisions needs to be examined in the EAC as part of the reform of its decision making system.

Fourthly, enlargement raises yet another dynamic that relates to locking in the new member states into the EAC legal and regulatory framework.

Rwanda and Burundi will immediately enjoy membership in the East African Legislative Assembly and participate in the oversight responsibility of the Assembly over the EAC Secretariat.

So will they also be entitled to appoint a Judge each to the two Court Chambers of the East African Court of Justice. But these entitlements come with obligations which are well enshrined in the EAC Treaty.

They centre on democratic consolidation, promotion of good governance and human rights, peace and security and embracing a market economy. It would be dangerous for the new Partner States to shoot themselves on the foot!

As a side point, but important in promoting an East African identity, a key dynamic in the integration process is the mainstreaming of Kiswahili as East Africa ’s lingua franca along with English.

It has just been reported from Uganda that all MPs and school going children shall receive Kiswahili instructions to prepare for the East African Federation.

Rwanda and Burundi will have to follow suit.

Burundi introduced compulsory Kiswahili as a subject from primary school level since September 2006.

Fifth, a key dynamic of enlargement, particularly in respect of Burundi, but probably Rwanda as well, is the huge hope and expectation of the people of the two new Partner States that their membership of the EAC will result in faster reconstruction and development of their economies and societies, including the re-establishment of viable and robust institutions essential for promoting governance, democracy, rule of law, peace and reconciliation and stability.

In the EU, there are special funds called STRUCTURAL FUNDS for enabling new members to achieve critical transitions as members of the EU. The EAC lacks such funds and this will be a challenge.

Finally, and I have alluded to this point earlier in my presentation, there is little doubt that political integration is what would secure economic integration.

Nyerere was right when he wrote in the July 1965 issue of the Journal of American Society for African Culture that if you do not soon enough move forward to political integration, the result would be a backward movement into reduced economic cooperation.

His reference point was the East African experience. The EAC should be well seized of Nyerere’s thinking going by the experience of the collapse of the erstwhile EAC in 1977. Interestingly, the EU is well seized of this dimension about political integration. This is why it is so seriously concerned about the fate of its Constitutional Treaty.

After the 2005 debacle of the Treaty, the recent EU Summit under the German Presidency has moved closer to promoting a semblance of political integration.

For us in the EAC, we cannot afford the luxury of not realizing, soon enough, the imperativeness of political integration as the locking mechanism for ensuring the sustainability of our economic integration.

However, when we should go for political integration may be the burning question. Its necessity, on the other hand, is clearly without question. At the same time, however, the EAC should be mindful of the dynamic of fast-tracking, what some East Africans, and especially many Tanzanians view as simply fast tracking the political federation.

The dynamic centres on the question how such fast tracking would respond to what are perceived to be existing different levels of development in the region.

The fears and concerns that centre on issues of land, jobs and even varying commitments of Partner States to democracy and governance and the state of national security in the different Partner States cannot simply be swept under the carpet even when some of us regard these issues as inconsequential in the integration vision.

They remain important dynamics of integration and development and should be seriously examined.

Let me conclude by saying that EAC integration and the enlargement that has recently arisen and that may further arise in the future, is a triumph of regional and African economic liberation. We must celebrate it. We must consolidate and protect it.

I THANK YOU

Ends