By Business Insider Reporter
The East African Business Council (EABC) is making a compelling case for unity: East African Community (EAC) Partner States must negotiate trade agreements with third parties collectively as a bloc, rather than pursuing separate bilateral deals that risk undermining regional cohesion and economic integration.
Speaking from Arusha, Mr. Adrian Raphael Njau, Acting Executive Director of the EABC, emphasised that regional unity in trade negotiations is not merely a bureaucratic ideal, but a strategic necessity.
“A unified EAC approach strengthens our bargaining power, builds trust among Partner States and ensures adherence to a common external trade policy,” he said.
At the heart of the EABC’s call lies the EAC Customs Union Protocol (CUP), which mandates the bloc to coordinate trade relations with foreign countries as a way of upholding the Common External Tariff (CET).
This unified CET is a cornerstone of the EAC’s regional integration agenda, establishing consistent duties on goods entering the region from outside its borders.
Threat of fragmentation
Yet, in recent years, a growing number of bilateral agreements between individual Partner States and external trading partners have raised alarm bells within the regional private sector.
These uncoordinated agreements – some allegedly concluded outside the procedures outlined in the CUP – threaten to erode the integrity of the CET and fragment the single market.
“Trade deflection becomes a real risk when one Partner State signs tariff concessions that differ from the CET,” Njau warned noting: “This could force other members to restrict the free movement of goods, a core principle of the EAC Customs Union.”
While Article 37(4) of the CUP allows Partner States to sign independent trade agreements, such agreements must not conflict with the broader regional framework.
In practice, however, ensuring such alignment has proven difficult – particularly with trade partners outside the African continent.
Lessons from the EU and UK Trade Deals
The challenges are starkly illustrated in the EAC’s experience with the European Union and the United Kingdom.
The EAC-EU Economic Partnership Agreement (EPA), after seven years of negotiation, was only signed by Kenya and Rwanda in 2016.
After ratifying iy alone, Kenya was forced to renegotiate a bilateral EPA with the EU that came into effect in April 2024 under the principle of “variable geometry.”
A similar scenario played out with the UK post-Brexit. Although the UK initially sought a continuity agreement with the entire EAC bloc, only Kenya – classified as a non-Least Developed Country (non-LDC) – signed a bilateral EPA, ratified in 2021.
Kenya was driven by the need to maintain preferential market access that other LDCs in the bloc could still enjoy unilaterally under the UK’s Generalized Scheme of Preferences (GSP).
This split, based on development classification, has resulted in an uneven playing field.
While Kenya engages in reciprocal EPAs requiring tariff reductions, its EAC counterparts export under non-reciprocal GSP terms.
The fragmented approach dilutes the EAC’s negotiating strength and undermines the region’s long-term trade strategy.
Trade policy divergence
The problem runs deeper than legal frameworks. Even within the bloc, tariff structures have begun to diverge. Kenya, under its EPAs, uses tariff concessions based on the EAC CET 2017 structure – three bands of 0%, 10%, and 25% – while other Partner States have adopted the 2022 CET version, which introduced a fourth 35% band to better protect regional industries.
This mismatch not only complicates customs procedures but also exposes the bloc to inconsistencies that external partners can exploit.
Why unity matters now
Despite these challenges, there is precedent for successful collective bargaining.
The EAC has previously negotiated the African Continental Free Trade Area (AfCFTA) and the Tripartite Free Trade Area (TFTA) as a bloc, securing preferential access to African markets.
Under these agreements, Partner States made joint tariff offers anchored in the CET – an example the EABC wants to replicate in negotiations beyond the continent.
With countries like the UAE, China, Turkey, Singapore, Indonesia, and the Gulf Cooperation Council (GCC) expressing interest in free trade deals with the EAC, the need for a unified strategy is urgent.
A fragmented approach could result in overlapping and conflicting trade regimes that destabilize the region’s industrial and agricultural sectors.
“The dual categorisation of EAC countries – LDC and non-LDC – should be a negotiating strength, not a weakness,” Mr. Njau noted.
He advocated for a comprehensive framework that accounts for development disparities while remaining inclusive, pro-growth, and private-sector-driven.
