OFFICIALS PREDICT THAT EAST AFRICAN COMMUNITY REGION WOULD BECOME THE MOST ATTRACTIVE AREA FOR BOTH FOREIGN AND LOCAL INVESTMENTS.
Business Report by Leo Odera Omolo In Kisumu CITY.
East African is expected to become more attractive to investors appetite for imminent opportunities in the East African Community, with the establishment of an East African Monetary Union.
A team of experts from the European Central Bank, who presented their findings of a study carried out on the establishment of a Monetary Union in the region, told a consultative meeting held in Kampala recently.
The team said the Monetary Union will significantly reduce business transaction costs, as there will be no need to convert one national currency to another.
The signing of the Common Market protocol in the last quarter of 2009 is already pulling in major investments, mainly from China, India and Japan.
“By eliminating barriers that were hindering Intra-East African trade, we expect business and trade between the five member states, namely Kenya, Tanzania, Uganda, Rwanda and Burundi would be significantly increased”, said David Nalo, the Permanent Secretary in Kenya’s Ministry of the East African Community Affairs.
“With strategies to expand our infrastructure and have a common currency, we expect goods and services to move even much faster from one point to another”, the PS added.
Mr Nalo was recently quoted extensively by the influential weekly, the EASTAFRICAN as saying that a single currency will not only substantially reduce transaction costs, but also bring about price stability.
Before the coming into force of the European Monetary Union a decade ago, an estimated USD 30 billion a year was being spent on foreign exchange transactions.
Then International Monetary Fund {IMF} says the elimination of these costs were particularly relevant to Ireland, the bulk of whose exports go to the European Union.
Statistics now show that the European Monetary Union increased trade among its member countries by between eight and sixteen per cent.
East African Monetary Union will thus result in foreign multinationals being more willing to set up in East African Community region. National Central Banks are also expected to save through lowering international reserves.
However, other reports appearing in the same paper, says that the initial efforts to reach a common position on rolling out a single currency for the region have run into hurdles, as Kenya and Uganda argue that the legal requirements of a full transfer of monetary sovereignty to the regional level carry with it the danger of exposing their countries financial sectors to external shocks.
Other latest development in the region is that in future, students taking East African states educational curricular, will soon be compelled to sit for a compulsory “East African Community Treaty” examination to gauge their grasp of the regions integration.
Although it is not known how soon teachings will begin, the EAC secretariat is currently working at incorporating the subject in the curriculum.
This news comes about as Uganda and Burundi introduce the region’s lingua franca – Kiswahili in schools curriculum this year. It also comes amid growing concern that the integration has not trickled down to ordinary citizens, hence the need for concerted efforts to popularize the East African Community.
The decision to introduce the EAC as a compulsory subject in schools was arrived at during the signing of the EAC Common Market Protocol in November last year, as one of the forward steps towards the region’s full integration.
It creates an interesting challenge for the region, which is grappling with challenges of educational standardization, given that partner states use different systems of education.
According to Kenya’s PS, Mr. Nalo, education is a key element in deepening the region’s integration agenda as exemplified in Article 102 sub-section 11, which partly lays emphasis on the development of a common programme in basic intermediary and tertiary education.
The section further proposes the harmonization of curricular, examinations, certifications, accreditation of training institutions in partner states.
“The EAC plans to undertake a long term harmonization process of education system in the region. The curriculum content will also be changed to adopt to each country’s national priorities and aspirations, “said Mr. Nalo.
The new curriculum is to be jointly developed by national bodies charged with the responsibility. To this end a committee has been formed specifically to deal with the same issue.
This committee will facilitate contact between universities of East Africa, set up a forum for discussion on academic and other matters relating to higher education, and maintain higher academic standards across the EAC region.
The PS said he would be sharing the EAC modalities of implementing the EAC decision with his counterparts in the education ministry, adding that education and training would help the EAC define its priority and aspiration.
Ends