Entry of DRC To The EAC Will Positively Impact Trade

DRC’s entry into the EAC is a win-win situation. Member states will all benefit. Existing EAC members should tap into opportunities presented by DRC to grow trade, increase investment, expand industries, grow GDP, and above all improve the economic well-being of citizens. DRC will equally...

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If you add 1+1 you get 2. Economists might argue that you will get 3 if you factor in an overlapping relationship like that of a Venn diagram. Others might claim that the answer is 11, an argument that might take us ages to prove! Either way, numbers don’t lie and the entrance of the Democratic Republic of Congo into the EAC will affect numbers in terms of increase in trade, jobs, and investments among others.

The new entrant into EAC brings opportunities such as a huge consumer market of over 90 million people which will mean expanded trade. Further, English and Swahili are the official languages of the EAC and the entry of Congo brings an opportunity to embrace a multilingual EAC. DRC applied for membership in 2019 hoping to improve political relations and trade with its East African neighbours.

At last, the joke that has been flying around In Kenya with those who speak French being challenged as to why they made that decision yet many Kenyans speak Swahili and English, will finally be able to communicate with their Congolese counterparts; since lots of people speak French in DRC. It is not all rosy as the state of infrastructure and security is wanting in Congo. However, the benefits outweigh the challenges.

The East African Community is a regional intergovernmental organization founded in 1967. The mission of the Community is to widen and deepen economic, political, social, and cultural integration to improve the quality of life of the people of East Africa through increased competitiveness, value-added production, trade, and investments.

The key benefit of integration is to harmonize the movement of labour and border customs. The East African passport allows holders multiple entries valid for six months. Members of these six states do not require Visas to travel within the region. The cross-border ease of entry will facilitate the free movement of people. People will be free to scout for employment opportunities and seek jobs freely within the EAC. Free interaction of people will enhance cultural diversity and exchange.

In addition, liberalization and the free movement of people will open up trade opportunities. For example, Kenyans will have an opportunity to scout for opportunities in DRC, which has a population of over 90 million. Equity Bank is Kenya’s leading bank which has set the pace to tap the huge market DRC presents. With trade opening opportunities to DRC, residents of DRC will also get exposure to participate economically through investment and trade in other EAC countries (Tanzania, Kenya, Rwanda, Uganda, Burundi, and South Sudan) and uplift their plight.

The subject of cryptocurrencies is another area that the East African Community member states may consider having a united conversation about. Citizens of some member states in the community have placed Kenya and Tanzania on the global map with crypto adoption. Kenya topped the world in crypto peer-to-peer (p2p) transactions while Tanzania was ranked at 4th position according to the 2021 Global Crypto Adoption Report.

Should the EAC member states be interested in adopting a united stand on digital assets and their role in the economy of the region, then Kenya and Tanzania would come in handy. The two countries have also initiated conversations around Central Bank Digital Currencies (CBDCs) and would lead that conversation. Tanzania has also discussed with IMF calling for global consensus on crypto assets and the Central Bank Digital Currencies.  Crypto can be a trade enabler and citizens of the EAC member states would also diversify their investment portfolio by pursuing other crypto opportunities such as staking, lending, and trading. 

DRC is endowed with mineral resources. It will now be easier and cheaper for importers and exporters from EAC to trade with the recent entrant, DRC. These minerals and other resources will spur manufacturing which in turn, will create more employment opportunities. EAC’s industrialization and policy strategy promotes the transformation of the manufacturing sector through high-value addition and product diversification based on the comparative and competitive advantages of the region. Manufacturers will access a larger market that will give them economies of scale and make them competitive.

Security is important for a stable business environment. DRC needs to get to the root cause of her internal conflicts to avoid scaring away new investors from the fellow EAC community. The armed groups in the eastern part of the country must be stopped for DRC to maximally reap the benefits of the EAC integration.

Article 124 of the Treaty for the Establishment of the East African Community recognizes the need for peace and security within the East African Partner States. Member states agree to adopt the United Nations model law on mutual assistance on criminal matters. DRC should reach out to other EAC countries and ask for partnership and assistance to fix her security challenges.

DRC has a poor transport infrastructure. Good infrastructure promotes trade by facilitating a smooth flow of goods. It will be incumbent on the Democratic Republic of Congo to improve its infrastructure. EAC aspires to develop quality multi-dimensional strategic Infrastructure.

When all is said and done, I welcome the East African community’s latest member. In addition, a new community implies a new family. The integration brings an atmosphere of adding a new member to your family. This member needs to be supported unconditionally. DRC will now have better access to the ports of Mombasa and Dar es Salaam for ease of importing and exporting commodities.

Before EAc achieves some of the ambitious integration pillars such as the monetary union, low-hanging fruits should be pursued. These include pursuing a common market and a customs union. In addition, integration helps reduce taxes imposed on commodities. Lower commodity prices make products affordable even for low-income earners hence improving their livelihoods.

DRC’s entry into the EAC is a win-win situation. Member states will all benefit. Existing EAC members should tap into opportunities presented by DRC to grow trade, increase investment, expand industries, grow GDP, and above all improve the economic well-being of citizens. DRC will equally expand the market of her produce.

The EAC needs Congo and Congo needs the rest of the East African countries. To celebrate this milestone, let’s arise and observe a minute of silence…sorry, let’s put on some Congolese music and dance to some Papa Wemba tunes!

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2 comments

  1. Allan Reply

    Splendid piece.

  2. jose Gathece muriithii Reply

    DRC is a complicated country to say the least. Well endowed yet myriad with bad leadership it’s a 20/80 prospect to say the least. Hopefully we get the good end of the stick.


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