1. POLICY CHALLENGES AND OPPORTUNITIES

2.  Introduction  Overview of EAC  Challenges in Implementing EAC CU  Opportunities Abound  Lessons from the European Union  Way forward and Conclusion

3.  EAC integration in line with Abuja Treaty of 1991towards an AEC.  EAC population size of 126 million and GDP USD 44 billion provides strong potential to participate better in global trade.  EAC treaty major steps towards full integration: Customs Union; Common Market; Monetary Union; and Political federation.

4.  Institutionally: Summit of Heads of State highest body; council of Ministers decision making; coordinating committee; sectoral committees; EAC Court of Justice; Legislative Assembly; and Secretariat.  Customs Union commenced in Jan 2005  Adopted CET

5.  Internal tariffs eliminated over 5 year period ending Dec 2009.  Developed RoO to determine goods eligible for community tariff treatment.  Harmonization and development of EAC standards ongoing  Initiated strategy to eliminate NTBs

6.  Adopted regional competition policy and law  EAC Customs Management Act Implemented in 2005  EAC is notified as a Customs Union in the WTO  At regional level 4 members of COMESA while one Member of SADC

7.  EAC Customs protocol provides for export promotion schemes, special economic zones & exemption regimes, however member states still maintaining different schemes.

8.  Implementing the CMA: National focus on maximizing revenue rather than trade facilitation Non implementation of some provisions of CMA by member States. HR constraints at regional and national level to effectively steer implementation. Non-uniform application of relevant regulations and forms.  Parallel application of standards (national and regional).

9.  NTB’s within the region major impediment to trade.  Sensitization and awareness drives still lacking.  Overlapping membership in other REC’s.

10.  Large population size and GDP  Large skilled and semi skilled labor force.  Well endowed with natural resources including extractables.  Well established financial, telecomunications and insurance institutions

11.  Vibrant and upcoming capital and securities market.  Duty free quota free Market Access under EPA as well as S&DT under WTO Agreements as developing and LDC members.

12.  From start had a common commercial policy.  ToL further streamlined and enhanced EU Trade Policy giving it exclusive competence on key aspects of trade.  Negotiation of trade agreements at bi-lateral; regional; and multilateral level done as a block.

13.  Mandate EAC secretariat with exclusive competence to implement a common trade policy for the region including negotiation with third parties at bilateral; regional; and multilateral level.  Hasten harmonization of trade and related policies.  Improve institutional coordination between national and regional bodies.

14.  Develop and apply a unified, simple regional trade policy tool.  Establish dedicated research institution or department to benchmark and enforce best practices.  Promote and improve on awareness raising drives.

15.  Improve trade facilitation by eliminating NTB’s, improving infrastructure and addressing the other supply side constraints faced in the region.  Continually assess and evaluate the impact of applied policies with a view to improve and redress any short comings.

16.  All in all the EAC brings with it a great potential for economic development in the region, with the right policies applied in a uniform manner, the vast resources will be better exploited, investment opportunities enhanced and the limited technical human resources especially in trade and related institutions better utilized at the national, regional and multilateral level by pooling resources from amongst the member states.

17. THANK YOU