Writes Leo Odera Omolo
The East African Community [EAC} has commissioned a study ahead of direct trade negotiations between the bloc and the United States which is keen to deepen ties with the region.
A directive by the EAC Sectoral Council on Trade, Industry, Finance and Investment, which consists of Ministers who handled the EAC docket, has directed the directors to undertake a study to determine what the negotiations should be based and how the region would benefit from any resultant agreement.
The Trade and Investment Partnership Agreement {TIPA] between the EAC and the US was initiated last year to support the economic integration of the region and enhance the EAC-US trade and investment play in economic and social development, including job creation,
Washington’s push for the clearly defined trade ties between East Africa Community and the United comes at a time when China is emerging as a dominant player in the region.
The study expected to be completed within four months will allow for shorter and more focused negotiations as opposed to the outgoing talks between the EAC a nd EU, which have dragged on for a long time.
A Mr Felix Okatch, a Kenyan multilateral trade expert, however, said the region should not expect a lot from the agreement because the distance between the two partners is a hindrance for trade when compared with the EU. Rwanda is the only country in the region that has a bilateral trade and investment agreement with the US. It was signed in December 2011.
He added that Rwanda-US deal would not affect the trade agreement to be signed by all the EAC member states and the US, as they would be bound by the most favored between nation {MEN} clause.
“In this case, what the US exports to Rwanda will also be exported to the other partners and what Rwanda exports to US can also be exported by the other partner states”, as per what the EAC treaty states.
The EAC-US trade and investment is a component of the US strategy towards Sub-Saharan Africa,which President Barrack Obama announced in June 2012.
President Obama’s objecives are to strengthen democratic institutions, promote peace ,unity and trade and investment.
The total trade volume between the EAC and the US is estimated currently at US D 1.1 billion and the trade between the US and Kenya is estimated at 656 million followed by Tanzania USD 201 million, Uganda USD 142 million, Rwanda stands at USD 81 million while trade with Burundi is USED 51 MILLION.
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