EAC leaders link investment prospects to reforms

From left: Presidents Karume, Kibaki, Kagame, and Uganda’s deputy prime minister Eriya Kategaya during the East African Community Investment Conference held in Nairobi. They were urged to invest in new energy sources and telecommunications. 

By Jim Onyango

Last week, the curtains came down on the three-day East African Community investment conference held in Nairobi from August 29. It was the second such conference, with the first forum having taken place in Kigali last June.

The Nairobi conference came at a time of great global economic contraction that threatens to erode some of the gains the region has made in the last few years.

The economic challenges have led to inward looking policies among multinational corporations that had made inroads into the region. But leaders say the challenges presented enormous opportunities as well for the region to re-position itself in the emerging global economic order.

The EAC investment conference is an annual event held in rotation in the partner states. Presidents who attended the conference included Kenya’s President Mwai Kibaki, Pierre Nkurunziza (Burundi) Paul Kagame (Rwanda) and Amani Abeid Karume (Zanzibar).

Uganda’s deputy Prime Minister Eriya Kategaya represented President Yoweri Museveni while Mr Karume represented Tanzania’s president Jakaya Kikwete.

The conference was intended to showcase the region as an investment destination. The East African region has been growing. The GDP growth of member states in 2008 was above five per cent.

The improved performance of the economies is in large part due to reforms that have embraced the private sector as a key driver of the economies.

Leaders expressed optimism that the five member states forming the EAC would impalement the recommendations made at the event.

Among recommendations made was to carry out judicial reforms so as to reduce corruption that has been considered a bottleneck to business in the region.

The countries also resolved to enhance public/private partnerships in the construction of infrastructure so as to facilitate cross border trades.

“The region should work together to coordinate reforms that are necessary to make the region the most attractive for investments,” said Kenya’s Prime Minister Raila Odinga.

The conference recommended that leaders of the five member states should take deliberate steps to invest in new energy sources and telecommunications infrastructure that would make the country more attractive to international investors.

Kenya, for example, is staring at an energy crisis following a prolonged drought that resulted in shutting down a hydro generation plant last month. But the government says it has commissioned a task force to investigate new renewable energy sources so as to reduce dependence on hydrogenation.

Power generation
“We are now aware of the impact that commitment to construct or modernise all forms of infrastructure in adequate amounts could have in promoting and attracting investments. Through the EAC framework, member countries are pursuing a number of projects with respect to power generation and sharing, inter regional road networks improvement, rail transport upgrading, the development of the Lake Victoria basin, environmental conservation, as well as air traffic safety,” said President Kibaki.

But investing in infrastructure alone is not adequate to open up the region to investments. According to Mr Kagame, member countries must studiously labour to streamline structures to make it easy for investors to put their money into the region.