EAC State of the Union

On Friday 2nd of March 2012, the Kenyan President together with his South Sudan counterpart and the Ethiopian prime Minister will officially lay the foundation for the commencement of the construction of the $22 billion LAPSSET project in Lamu. Just for a recap, Kenya has signed an agreement for purchase of electricity from the power rich Ethiopia and the construction of the transmission line is in progress currently. Also recently, Kenya signed an agreement with South Sudan for the construction of an oil pipeline from SS to Lamu. Other bilateral agreements are on the way. In Somalia the Kenya Defence forces together with the TFG forces are working hand in hand together to eliminate the terror group Alshabab which had caused insecurity across their common border. It is worth to note that these TFG forces were trained in Kenya. With all these happenings it is all clear where the next phase of growth for Kenya will come from. With the Power rich Ethiopia and Oil rich SS and Somalia in the books one is left to wonder what will be for the EAC especially with lethargic members like Tanzania. Other than providing a ready market for Kenyan goods the EAC does not seem to offer anything else. Could the EAC have been just a marriage of political convenience without any tangible economic benefits to their members. Is this what is making members like Tanzania and Rwanda develop cold feet. From all their economic blue prints, none of the EAC members have plans on how to integrate their econmic aspirations with Kenya hence they look like they are either too afraid or are simply not willing to. Thus the question is there any need for the EAC in the coming years.

Other than Uganda and South Sudan who have proven oil deposits and are either drilling or are about to start, other countries in the region like Kenya and Somalia are prospecting and indications are that they may hit the jackpot within no time. The high expectations are due to the proceeds that come with this resource. It should not however be taken as the only resource that these countries have or have had. They have had Agriculture, Tourism, Manufacturing e.t.c. and have been doing well with these. The tendency from newly producing countries, is that most of them have abandoned other forms of economic activities to only rely on the hydrocarbons. In case this source of hard forex is interrupted it becomes very difficult for them to climb down from the high standards of living they had adopted.
It is important for the countries in the EAC newly endowed with the hydrocarbons, harness this resource to support their already performing sectors. They should learn and desist from what other countries with this resource have been doing. Angola, E-Guinea, Gabon etc have not used their financial resources to prosper their populace rather have had the elite amass luxuries for themselves. Let the EAC countries use this resource to Increase the availability of fertilizers, pesticides seeds and farm machinery products as this will go a long way in ensuring higher food productivity and security. Expand the transport infrastructure to increase mobility of goods and services and invest in robust communications networks so as to ensure the accessibility of the hinterlands like expand the fiber network coverage to at least the sub-county level. currently no EAC country can boast of having a good level health system and therefore better health facilities, provision of advanced medical services and good public health and sanitation will need to be invested in heavily. Since the middle class will be expanding, funding for academic and human resource upgrading institutions will need to be upped so that all the required experts can be sourced locally.
Basically the proceeds for the Hydrocarbons should be seen as a source of cheap loans to support other sectors of the economies and not as a blank cheque for the ruling elites to amass all the toys they have ever dreamt of having

Is there any rationale in the compensation arrangement, what of the Kenyan owned businesses that were also affected by the PEV. I am sure this is challengable in court. http://www.monitor.co.ug/Business/-/688322/1378004/-/4yh86l/-/index.html

Sierra Kilo wrote:On Friday 2nd of March 2012, the Kenyan President together with his South Sudan counterpart and the Ethiopian prime Minister will officially lay the foundation for the commencement of the construction of the $22 billion LAPSSET project in Lamu. Just for a recap, Kenya has signed an agreement for purchase of electricity from the power rich Ethiopia and the construction of the transmission line is in progress currently. Also recently, Kenya signed an agreement with South Sudan for the construction of an oil pipeline from SS to Lamu. Other bilateral agreements are on the way. In Somalia the Kenya Defence forces together with the TFG forces are working hand in hand together to eliminate the terror group Alshabab which had caused insecurity across their common border. It is worth to note that these TFG forces were trained in Kenya. With all these happenings it is all clear where the next phase of growth for Kenya will come from. With the Power rich Ethiopia and Oil rich SS and Somalia in the books one is left to wonder what will be for the EAC especially with lethargic members like Tanzania. Other than providing a ready market for Kenyan goods the EAC does not seem to offer anything else. Could the EAC have been just a marriage of political convenience without any tangible economic benefits to their members. Is this what is making members like Tanzania and Rwanda develop cold feet. From all their economic blue prints, none of the EAC members have plans on how to integrate their econmic aspirations with Kenya hence they look like they are either too afraid or are simply not willing to. Thus the question is there any need for the EAC in the coming years.

I still think M7 should have been invited as well. UG is such an important player to be left out.