Trade Negotiations in East Africa: The necessity to implement a joint trade negotiations body

In responding to the current realities of globalization, development, aid and political dialogue, African countries have found themselves involved in various multilateral trade co-operations with various trade partners. The binding agreements that the countries commit to have become a source of concern as their impact on the future of the economies involved is uncertain. Questions have been raised about the long-term benefits or costs to domestic trade regimes of the developing countries involved, the ability of the countries to fully take advantage and benefit from the proposed opportunities and the possible effect of the agreements on the overall development strategies. Thus the negotiation phase is very critical in determining the trade and development future of African countries involved. 

by Gladys Kirungi

The East African Community (EAC)

On the 2nd of March 2004, the East Africa partner states signed the East Africa Customs Union Protocol. This was expected to facilitate the formation of an East Africa trade regime that would enable regional cooperation in trade and development. Key aspects of this protocol include a Common External Tarrif, (CET) on imports, duty free trade and common customs procedures between the partner states. This should pave the way for the transformation of the EAC into a single market and investment area and hopefully provide an opportunity for the region to unite in strength and play a more significant role in responding to global opportunities and challenges.

In a workshop convened by SEATINI Kenya and CUTS Africa Resource Centre in July 2010, disappointment was expressed over the way East African countries continue to handle negotiation processes individually, despite the possible benefits of the customs union, which encourages unity of the region in its relationships with other blocs or international agreements. Trade negotiations in the region are further complicated by the fact that even within the countries there is limited coordination and harmonization of decisions taken due to the fact that there are multiple ministries and committees involved in negotiation. For example in Kenya, regional and multi-lateral negotiations are led by the Ministry of Trade and the Ministry of Planning. The ministry of Trade also handles WTO (World Trade Organization) and COMESA (Common Market for Eastern and Southern Africa) negotiations, while the ministry of finance handles the EU- ACP (Development cooperation between the European Union and the countries of the African, Caribbean and Pacific group of States) relationship. The EAC ministry handles EAC affairs. Within the ministries different committees are formed to lead the various negotiation processes, for example there is a national committee on WTO, KEPLOTRADE (Kenya Post Lome Trade Programmes), EU-ACP and COMESA. According to a paper presented by Prof. Otieno Odek, there is no proper coordination between the ministries or the committees formed and this hinders the ability to front a harmonized and consistent negotiating position.

Given that most of the committees consist of government or ministry employees, the negotiation processes are often affected by the issues facing the public service, for example: un-guaranteed continuity and sustenance of institutional memory as a result of transfers that are procedure in the public service. Other weaknesses due to public service affiliation include: low motivation, a bureaucratic chain of command which slows down decision-making, un-guaranteed participation of the civil society and the private sector and the possibility of a casual and informal approach to trade issues. All these may contribute to compromise the credibility and outcomes of agreements that the region gets into. Other impediments to current negotiation abilities include: inadequate financial capacity to cover the high cost of participation from the region which entails maintenance of representatives at the different regional and multi-lateral fora, Kenya and Uganda for instance are participants in EAC, COMESA, WTO, ACP-EU, the Cotunu Agreement, IGAD and the AGOA (African Growth Opportunity Act) initiative. Tanzania is a member of EAC, SADC (Southern African Development Community), ACP-EU, the Cotunu Agreement; and all the countries are involved in other bi-lateral arrangements.

The high costs of participation limit the ability and capacity of the states to adequately participate and follow the numerous technical debates and discussions. For this reason there is very limited information and understanding of proposed issues and discussions therefore, decisions may be taken blindly on the basis of scanty or incorrect information. Effective participation in the often highly technical negotiations requires the ability to understand and address complex analytical issues and projections, It is thus pertinent that a highly qualified and informed team is employed. However with the current system not enough effort is spent in identifying and employing the relevant experts. Moreover the region continues to depend on external assistance for funding and technical advice. This is likely to have the impact of moderating demands and adjusting positions in order to please the donors.

The Contribution of joint EAC negotiating body

The importance of a joint trade negotiating body was emphasized by SEATINI Kenya, and CUTS Africa Resource Centre, Nairobi, because of the envisaged potential of the region to pool resources and expertise and the advantage of size in order to secure more favorable trade deals. The formation of a joint body to specialize in negotiations for the region would necessitate the formation of a legal foundation and the creation of joint negotiating structures and systems. This will help to deal with the current challenge of lack of coordination and harmonization in the national and regional positions as Individual partner states would have no discretion to negotiate with non-member trade arrangements that contravene the agreed CET.

It is expected that a joint regional negotiation body will help to lessen the existing financial and budgetary constraints as all the member states will be expected to contribute to the maintenance of the negotiating institutions and teams. Implementation of a joint body would eliminate the duplication personnel positions and roles. This could contribute region to securing additional resources to recruit and maintain quality skills and expertise. This body would be expected to ensure representation from the various sectors in the region, including parliament, civil society and the private sector and thus provide the required checks and balances. All in all, the workshop argued that if the partner states are to maintain cohesiveness of the EAC as a trading bloc, negotiating as a bloc is a necessity.

It is also hoped that the implementation of a joint negotiating body for the region would provide better chances of ensuring maintenance of a consistent, representative and highly skilled negotiation team that would dedicate more time and efforts to understanding and participation in negotiation issues and this would help to ensure better negotiating positions for trade agreements that involve the region.

 

References

1. Prof. Otieno Odek, (n.d), 'Background paper for a joint East Africa Trade negotiation Commission Bill'

2. African Economic Research Consortium (AERC), (2004), 'Report of Dissemination workshop on the Research Project on African Imperatives in the World Trade Order', available at www.aercafrica.org

3. Md. Joynal Abdin, (2009), 'Need for trade negotition framework for a promising future', in The Financial Express, August 3rd 2010

 

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