New steps towards economic integration in East Africa

Rwanda and Burundi have formally joined the East African Community Customs Union. Thus, after 2 years of efforts, all 5 member States of the East African Community joined the customs Union. This marks a historic step in the process of economic integration in the East African Community countries. The East African community was created in 1967 by 3 countries of Tanzania, Kenya and Uganda.　　Burundi and Rwanda joined the East African community in June 2007, bringing the membership of the Organization to 5. The East African Community Customs Union has experienced an uneven course of development. In March 2004, Kenya, Tanzania and Uganda, after more than 3 years of arduous negotiations, agreed on the establishment of the East African Community Customs Union and signed the East African Community Customs Union agreement in Arusha, Tanzania.　　The signing of the agreement has not only accelerated the economic exchanges and cooperation among the 3 countries, promoted their respective economic development, but also laid the foundation for the realization of the goal of economic integration in East Africa. January 1, 2005, the three East African Customs Union officially launched. From that year onwards, the East African Community Customs Union began a partial implementation of the tariff reduction, with the aim of achieving zero tariff full implementation by 2011. 4.5, the customs Union has played an important role in achieving regional trade liberalization in East Africa and in promoting Member States to further enhance productivity, attract foreign investment and achieve industrialization as soon as possible. Kenya, as the most economically powerful country in the 3 countries, has gained more raw materials from another two Member States, further enhancing the competitiveness of its own industrial products, boosting economic growth and improving the employment situation. At the same time, Kenya expanded its investment in Uganda and Tanzania as a major source of foreign capital for both countries.　　Tanzania and Uganda, the United Nations as the world's least developed countries, have not only benefited from the economic benefits of trade with Kenya, but have also introduced relatively advanced production technologies and management methods in Kenya, which have facilitated their own economic growth. The imbalance in the level of economic development is the main problem faced by the East African Customs Union. Of the 5 countries in the East African Community, Kenya has the best economic growth of 608 U.S. dollars per capita, while the most difficult economic development in Burundi per capita GDP is only 118 U.S. dollars. From 2000 to 2006, the average annual GDP growth rate of 5 countries was 4.74%. Among them, Tanzania, which has the fastest economic growth of the year, is as high as 6.7%, and the slowest economic growth in Burundi is only 2.5%. For member countries with underdeveloped economic development, joining the customs union means a certain loss to revenue. For example, in the draft budget for 2009/2010, the Government of Rwanda estimated that fulfilling the responsibility of the East African Community Customs union would in the short term lead to a loss of 12.4 billion per cent of revenues.　　To cover this loss, the Rwandan government is likely to take measures to expand value-added tax and excise tax. In the current global economic situation, the East African Community recognizes that the economic power of one country alone is difficult to withstand the negative effects of the international financial crisis and must be combined to strengthen economic, trade and investment cooperation within the community. In the immediate future, joining the customs union will result in a certain amount of revenue reduction for the new members in the short term.Less, but in the long run, joining the customs union will make the market goods cheaper, so that the volume of trade growth, thereby increasing the income of fiscal income, which can not only make up, or even more than reduce the tax losses.　　Therefore, the announcement of the formal accession of Rwanda and Burundi to the East African Community Customs union shows that African countries are seeking a strong desire and trend to accelerate their own economic development through strengthening regional internal economic and trade and investment cooperation under the impact of the international financial crisis. It is reported that the East African Community Customs Union plans to launch the Common Market in January 2010 to achieve the free flow of people, goods, capital and services among the 5 countries.　　By then, a market of 127 million, with a cumulative gross domestic product of about $60 billion trillion, will be shown in East Africa, providing a new economic and trade and investment opportunity for the continent and other businesses. At present, sub-Saharan African countries have established the ECOWAS, the Central African Economic Community, the East African community and the Southern African Development Community. The pattern of regional economic cooperation in Africa has been basically formed. In recent years, these regional economic cooperation organizations are speeding up the process of economic integration. For example, the Southern African Development Community (SADC) officially launched the South Africa free Trade Area last August. The 5 countries of the East African Community successfully completed the customs union and planned to launch the Common Market next year, adding new impetus to the future development of the African Economic Union.