Statement by the EAC Deputy Secretary General (Planning and Infrastructure), Mr. Alloys Mutabingwa at the media breakfast meeting on the forthcoming 3rd EAC Investment Conference on 24 April 2010 at the Imperial Royale Hotel, Kampala
The East African Community is made up of 130 million people with a combined gross domestic product of USD73 billion and average GDP per capita of USD506.
With a fully fledged Customs Union in place, and the commencement of the Common Market from July,2010, the people of East Africa will enjoy the full benefits of cross border trade and investment across the five countries. The EAC Partner States have continuously harmonized their business laws, systems and administrative structures to enhance more trade and investment among them. We are steadily building a region that constitutes one market, one destination for investment and business.
The East African Community today stands as a region that operates under a fully fledged Customs Union with effect from 1st January 2010. Further to this achievement, Partner States successfully negotiated and concluded the Common Market Protocol in November 2009 and it is expected to be operational by 1st July 2010.
As the region moves towards a fully integrated economic community where goods, capital, labour and services move freely without borders, it is important to note the abundant potentials that East Africa poses today.
The inaugural Investment Conference hosted by the Republic of Rwanda in 2008 brought together more than 1000 participants, amongst them regional and international investors and world business leaders, under the theme, Leveraging the East African Market through Trade and Investment”. The 2nd annual conference hosted by the Republic of Kenya in 2009 had about 1500 participants and was themed Invest in the EAC; where Global challenges are Opportunities.
The 3rd East African Investment Conference being hosted by the Republic of Uganda from 27th - 30th April 2010 and themed EAC Common Market: The Preferred Investment Destination, signals the implementation of the next hallmark in the EAC integration agenda: the EAC Common Market. It is being hosted by Uganda in collaboration with the National Investment Promotion Agencies, the EAC Secretariat and the business sector represented by East African Business Council (EABC).
For EAC countries to stand global market competition, they must organize, unite, stand and be counted. Considering investment promotion, there are over 170 Investment Promotion Agencies the world over competing for scarce investment resources. Aggressive attempts have been made both at the regional and national levels, to attract and retain investors. That is why we have to step up concerted efforts to promote the region as one viable investment destination. Our EAC governments and the private sector realize the importance and have committed resources for the success of these initiatives.
We call upon other partners within EAC and beyond to join hands with us in accelerating these initiatives.
As we continue galvanizing the EAC and showcasing the market potential and investment opportunities within the Community, cross-border trade and investment is on the rise. The total Foreign Direct Investment has exponentially increased with Kenya attaining above US$ 50 million; Uganda US$200 million; Tanzania US$300 million; and Rwanda US$799 million.
From a study conducted by the East African Business Council and another by the EAC Secretariat, there are strong indications that Uganda peaks attraction of cross border investments followed by Tanzania and Rwanda, while Kenya remains the largest single source of cross border investment in the region. Burundi is also on a steady rise given its magnificent tourist sites, strategic geographic position as well as natural resources. All the five countries acting together strive to be an international investment hub, implementing policies and strategies that are anchored on comparative advantages among them.
Most of the investments are in the services sector mirroring the trends in this sector in terms of contribution to the regional economy.
We keep the fire burning, being the reason for organizing the 3rd EAC investment conference just eight months from when we held the 2nd EAC Investment Conference in Nairobi, Kenya. Through these sessions, we do not only showcase investment opportunities, we enable business firms and individuals to discuss and possibly enter into joint-ventures/partnerships. We also have this as a key platform for Public-Private Sector Dialogue at the highest political and business level. That being the purpose for having each of the conference highly graced with the presence and participation of Heads of States of all the five EAC Partner States.
The EAC region has been acclaimed as one of the fastest reforming regions in the world in terms of doing business by internationally recognized institutions like the World Bank and UNCTAD. Last year, Rwanda topped the world as the fastest reformer while Uganda, Tanzania and Kenya have received accolades in this respect. With the Republic of Burundi setting up an Investment Promotion Agency last year, the region is now destined to become the business destination of choice in Africa and beyond.
In recognition of East Africa’s efforts on the global scene, the Executives of our Investment Promotion Authorities have been elected to top Associations of Investment Promotions in the world such as World Association of Investment Promotion Agencies (WAIPA), and African Investment Promotion Agencies Network (AFRIPANET). Individually, Investment Promotion Agencies have been recognized for outstanding performance in terms of investment promotion initiatives.
This particular conference will highlight the successes of Public Private Partnerships by way of benchmarking with other economies.
As we showcase the various investment opportunities that EAC offers, the conference will discuss the possibilities of joint partnerships, direct investments, industrial growth and economic development in the region. Key topics will be discussed such as climate change and food security, commercializing agriculture, promoting competitiveness and value addition, investment in renewable energy, extractive industries. We are fast-tracking reforms that make doing business in all these areas more attractive.
The conference will deliberate on the prime factors that impact on the business environment. As in the previous fora, the partnerships in infrastructure development will take a centre-stage in this conference. The particular focus being on incentives for joint investment ventures to support the road, rail and maritime transport systems. Through Infrastructure bonds and other facilities, efficiency in trade flow will rise, and a quicker more effective transit path for goods and people will be established. Without appropriate regional infrastructure, EAC would be balkanized, thus in this conference we re-vitalize discussions on ideal models for harnessing private sector capital in public sector investment, i.e public-private sector partnership framework (PPP).
As the EAC Common Market comes into force from July 2010, it is expected that free flow of goods, services and capital within East Africa will herald a new era in the EAC integration agenda. The Customs Union has already registered improved trade and investment among the Partner States. With the Common Market Protocol giving more freedom to investors, service providers and other ordinary East Africans; the stage is now set for more wealth creation. The firms will reap the benefits of economies of scale derived from a much larger market.
We must recognize and encourage cross border investors in EAC as a way of strengthening the bonds of integration, while enjoying the benefits of operating in a single market.
In this regard, as from the 3rd East African Investment Conference on-wards, we will formally and specially recognize the long awaited list of EAC Cross-border Investors of the Year.