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| Ken Obura, Chair of the Council of Ministers, with EAC Secretary General Peter Mathuki walk into the East African Legislative Assembly chambers to present the budget on June 28, 2021. |
The East African Community (EAC) stressed on Monday on timely remittances of funds from the partner states to finance its routine activities.
The regional body insisted as it tabled its 2021/2022 budget estimates that internal revenue sources can be a cure for repeated cash woes.
The $91.7million budget read at the East African Legislative Assembly (Eala) sitting in Arusha bore the hallmarks of declining support from the donors.
Out of $91.7million estimates for expenditure for the coming financial year, only $37.6million or 41 percent will be raised by the development partners.
The six partner states will each have to raise about $ 9million to the kitty to finance routine activities and implementation of development projects.
The decline in donor contribution to the budget has also come with falling total amount of expenditure estimates for the Community for years.
In the past five fiscal years, from 2016/2017 to 2020/2021, the estimates have ranged between $110million to $97million per year.
The budget estimates in the first Eala physical session since the outbreak of Covid-19 early last year, were read by the Kenya Cabinet Secretary for EAC Affairs Adan Mohamed.
He said although there were assurances of continued financial support from the donors, this time around much effort would be for partner states to strictly meet their obligations.
Out of the wholesome $91.7million, $43.8million or 47 percent of the budget will be allocated to the EAC Secretariat, the executive arm of the Community.
Eala will get $ 15.4million while the East African Court of Justice (EACJ) will receive $ 3.9million. The Secretariat, Eala and EACJ are the key organs of EAC.
The rest of the money will be allocated to seven EAC institutions spread across the region which receive their operational funds from the Secretariat.
An overview of the EAC budgets for the past six years indicate the budget allocation has dropped by $ 20m compared to 2021/2022 estimates.
According to Charles Kadonya,the Clerk to Eala, the highest ever budget for the Community to be tabled in the House was $124million some years back.
In a speech read on his behalf by the Kenya Cabinet Assistant Secretary Ken Obura, Mr. Mohamed said the EAC has been seriously impacted by Covid-19.
This was manifested in lockdowns and economic shutdowns resulting in loss of millions of jobs, livelihoods and general economic malaise.
Manufacturing and agriculture sectors have been affected due to disruption in global supply and fall in global demand for key exports from the region.
For instance,exports from Kenya and Uganda contracted 7.6 percent and 1.7 percent respectively between March to June last year.
During the same period, imports of intermediate goods contracted by 25 percent, 11.3percent and 22.9percent in Kenya, Uganda and Tanzania respectively.
Similarly, the industrial sector in Rwanda, Kenya and Uganda shrunk by 3.5 percent, 0.5 percent and 6.3 percent respectively.
"In addition, Covid-19 has led to adverse consequences on tourism and aviation sectors,workers' remittances, foreign direct investments and loan disbursements", he said.
According to him,the economic growth in the EAC region averaged 2.3 percent in 2020, compared to an average of 5.4 percent in 2019.
Nevertheless,growth in the EAC region is expected to recover in 2021 due to resumption of global economic activities and sustained implementation of growth-supporting measures.
In order to reposition EAC as a major player in international trade and strengthen intra-EAC trade, several measures are being taken to attain the goal.
These include a comprehensive review of the EAC Common External Tariff (CET) and the EAC Customs Management Act (CMA), 2004.
Under the CET review, partner states have adopted a four-band structure - 0 percent, 10 percent, 25 percent and a rate above 25 percent.
The reviewed CET and EAC CMA are expected to enhance trade facilitation and spur growth and economic development in the region.
Other measures to be taken in the next financial year are finalization of the review and development of Customs Union instruments
During the 2021/2022 fiscal year, the Inter University Council of East Africa (IUCEA) will top the EAC institutions in budget allocation.
The Kampala-based body will receive $ 11.1million followed by Lake Victoria Basin Commission ( $8.1million) while $3.6million will go to Lake Victoria Fisheries Organisation (LVFO).
The East African Science and Technology Commission will get $ 1.5million, $1.2million to East African Kiswahili Commission (EAKC), $1.8million to East African Health Research Commision and $ 1million to the recently formed East African Competition Authority (Eaca).
ends
B U D G E T B R E A K D O W N
*2021/2022 - $91.7m
*2020/2021 - $97.6m
*2019/2020 -$111.4m
*2018/2019 - $99.7m
*2017/2018 - $110.1m
*2016/2017 - $101.3m
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