regional intergration: Construction and the EAC

We look to the European Union (EU) as a model of a fully integrated regional economy, and construction played a major role in integrating and developing the EU economy.

We look to the European Union (EU) as a model of a fully integrated regional economy, and construction played a major role in integrating and developing the EU economy.

There was a Keynesian push to invest in infrastructure that had to be funded jointly by all states. This is the key to the success of the East African Community (EAC).

The nations of this region must devise a way to set aside a portion of their national budget for the joint development of our region.

We see the effects of inequality in our transport network, the road getting up to Gatuna is perfect, then bad roads till Nakuru and more after that; Rwanda pays the price for poor infrastructure in other countries.

Rwanda suffers the effects of limitations in capacity in the port of Mombasa, but as users we should also pay towards refurbishing the port in exchange for a share in the concern.

In the EU, richer economies subsidise poorer economies. When a nation joins, there are instant benefits in the form of extra funding for infrastructure projects in exchange for reforms.

In the negotiations for accession to the EAC, Rwanda has been asked to make a number of sacrifices, while the tangible benefits and comparative advantages have been few.

We will open our market to stronger competition but we need more out of this deal; construction is the one sector that can see tangible benefits.

It is important that our leaders strive to deliver practical benefits because the electorate always votes with their stomachs.

The problem that regional blocs often face is that negotiations are carried out by faceless diplomats and technocrats; quite often they make the right decisions but the electorate can feel disconnected from events.

That is the current crisis in the EU, where three countries voted to block the constitution because they felt taken for granted.

When a nation joins a regional bloc, those in power are first to foresee the benefits; but the ordinary man needs visible and tangible effects.

Take Ireland, a relative late developer in the EU; they received $100 billion over 20 years to develop their infrastructure.

So in Ireland the EU had a visible effect in that Dubliners can look around their fair city and see buildings, bridges, dams, power stations, sewerage facilities and know it has been a good deal.

The construction industry is the arm that builds the infrastructure for heavy industry; this industry has to be coordinated regionally in order to construct the EAC infrastructure needed to make it viable.

Our construction industry is beset by high costs that are punitive, it costs roughly $600 a metre sq to build in Rwanda and that is 30 percent higher than Uganda and 40 percent higher than Kenya.

Bringing down the cost of construction has to be the first benefit of joining the EAC; supply issues must be eliminated because they are the major cause of rising costs.

Cement is the first issue; supply is always tight and traders make a profit, but this supply is never eased enough to let market forces decide the price.

We should lift all restrictions on imported cement and building materials, the high cost is limiting our development and restricting growth.

We need a commitment from all countries to jointly coordinate and fund our construction sectors in order to open up and develop our markets.

Ends

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