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TRADE-EAST AFRICA: Tanzania Still Torn Between Two Blocs

Charles Wachira

NAIROBI, Oct 31 2008 (IPS) - There were six of them – esteemed Kenyan nationals working at east and central Africa’s largest media house, the Nation Media Group. They were supposed to demonstrate the value of the East African Community (EAC) by being allowed to ply their profession in neighbouring Tanzania. The year was 2005.

In big measure the move was emboldened at the time by the EAC treaty signed in November 1999 by Daniel Arap Moi, Benjamin Mkapa and Yoweri Museveni, the then three presidents of the perennial members of the testy trading bloc – Kenya, Tanzania and Uganda.

According to the treaty, a key plank was the unrestricted movement of labour between the three countries.

But with the speed of a drop of a hat, the six EAC ‘‘ambassadors’’ had their mission dashed when they were unceremoniously expelled from the sojourn – another dream deferred that decidedly underlines the chronic peril of trusting African politicians.

Three years later, this late September, the Tanzanian government capitulated to pressure exerted by a now larger EAC membership. It lifted the punitive lid that previously blackballed non-residents from settling in geographically the largest country in the bloc.

The third round of talks on an EAC common market protocol in Bujumbura, Burundi, happened at the end of September this year. At that meeting, Tanzania withdrew its objection to nationals from other member states having the right of residence in a host member state for purposes of economic activity or employment.

The new kids in the block, Burundi and Rwanda, joined the EAC in July 2007, formally making the bloc an African powerhouse with an estimated population of 120 million people and a gross domestic product (GDP) of a whopping 41 billion dollars.

Significantly the EAC has operated as a customs union since 2005, allowing goods from Uganda and Tanzania entry into Kenya tax-free while Kenyan exports to those countries are conversely subjected to customs duties until 2010.

Reason for this unbalanced arrangement is to allow the rest of the states within EAC clutch to catch up with Kenya’s economy. The latter’s trade volume to Uganda and Tanzania alone stands annually at about 45 billion dollars compared to a combined 2.2 billion dollars trade that the two states do with Kenya.

‘‘The only serious threat to the deal holding is that the Tanzanian government has since been sending mixed signals that effectively shows that the country’s heart is not completely immersed in the words emanating from the various high level meetings being held,’’ says Dr Gideon Oluoch, a researcher with the Regional Institute of Economic Affairs (RIEA).

RIEA is a local body involved in assisting small and medium enterprises navigate the treacherous road of becoming regional players.

Surreptitiously the researcher may very well be referring to, for example, what the Tanzanian deputy minister for east African cooperation, Mohammed Aboud, was quoted as saying by The Citizen daily newspaper, a leading title in that country.

‘‘In principle, Tanzania has no objections to foreigners working in the country because we are short of doctors, engineers and other experts,’’ adding that their cabinet would have to first be briefed about the outcome of the September meeting.

But since then Aboud has said, ‘‘if it is decided that the decision will serve national interests, then that would be fine. If not, it will have to be looked into afresh.’’

Confirming suspicions about Tanzania’s unenthusiastic attitude, his boss in the ministry, Diodorus Kamala, told a meeting of private sector representatives in Arusha, Tanzania, a month earlier that non-citizens ought to be barred from purchasing land there.

At Bujumbura, Tanzania also objected to the ‘‘right of establishment’’ clause in the protocol, which provides for nationals of member states to acquire or access land.

Tom Mshindi, a columnist with the local Daily Nation newspaper, has argued that Tanzania should be disallowed to stymie the objectives of the EAC. Plans to set up a common market by 2010 and a political federation by 2015 should go ahead irrespective of whether Tanzania plays ball or not.

‘‘Tanzania’s leaders argue that its people are not ready for the envisaged integration because its political and economic structures cannot manage the demands of integration, which call for elimination of all trade barriers, allowing free movement of goods and services, and finally having a political federation.

‘‘Informally, Tanzanians will confess their main problem is Kenya’s stronger economy and the aggressive streak of its entrepreneurs. It is very concerned that Kenyan professionals will have an unfair advantage over Tanzanians,’’ insisted Mshindi.

Just as well. Museveni, whose country Uganda is landlocked, upbraided Tanzania subtly last year, publicly showing his exasperation. His stern message was: Let’s move on with the objectives of the EAC – with or without the involvement of Tanzania.

Creating further suspicions over the Bujumbura accords is Uganda’s minister in charge of the EAC, Eriya Kategaya, as quoted by the Daily Monitor, the leading independent daily in that country: ‘‘Each EAC partner state has its priority needs in the regional integration process. It has a right to accept or reject some decisions.’’

Pervasively, Tanzania is thought by the rest of the EAC to be more inclined to working with the Southern African Development Community (SADC) that it also belongs to, further hurting the Bujumbura agreements.

All of this raises the real question of whether the Bujumbura deal, which took eight days to thrash out, will hold.