EDITORIAL: EAC needs to do more to improve manufacturing, intra-bloc trade

Regional manufacturers are currently in Kigali to chart ways of revitalising the sector and help increase its contribution to growth and job-creation in particular. The manufacturers, who are attending the second EAC Manufacturing Business Summit, want East African Community governments to put in place sector-supportive policies to drive growth

Tuesday, May 23, 2017

Regional manufacturers are currently in Kigali to chart ways of revitalising the sector and help increase its contribution to growth and job-creation in particular. The manufacturers, who are attending the second EAC Manufacturing Business Summit, want East African Community governments to put in place sector-supportive policies to drive growth. The East African business community blames the minimal contribution of 10 per cent to the bloc’s GDP on the lack of supportive policies and deliberate reforms to spur the sector’s growth.

Other challenges such as high power tariffs, poor roads and high cost of air transport also need to be addressed by EAC partner states for the bloc to register meaningful growth, create more jobs for the youth and reduce its dependence on imports that erode foreign exchange reserves.

In addition, the call by the East African Business Council for the region to produce "what we consume and consume what we produce” is timely. This challenges member states to promote value-addition initiatives, particularly among SMEs, to deepen and broaden the industrial sector. It’s such efforts that would lay a firm foundation that would allow for improved performance of the manufacturing sector.

However, regional governments must be ready to review laws that discourage trade and fair competition. The EAC Heads of Summit meeting held in Dar es Salaamm, Tanzania on Sunday  raised the issue of non-tariff barriers and the declining trade among member states. This calls for bureaucrats in the region to revise policies that affect manufacturing and trade within the bloc. EAC is a market of 160 million people, with a combined GDP of $150 billion. The challenge is on EAC governments to ensure a conducive business environment if manufacturers and other players are to fully exploit the opportunities that this market offers.