Even as the European Union's sovereign debt crisis comes "back from vacation," as a New York Times Magazine headline recently put it, a far less-known group of countries is following in the EU's very footsteps. This is the East African Community (EAC), a five-country bloc that is moving headlong toward the same kind of economic and political union now in peril in Europe.
The EU's experience -- including, not least, the ongoing Eurozone crisis -- offers plenty of lessons that could help the EAC replicate the EU's successes while avoiding its troubles. Economically, the evidence suggests that East African countries should vigorously integrate their markets but move cautiously regarding a common currency. Politically, they should focus intensely on accountability for democratic practices, though progress on this front will be more difficult than in the economic sphere.
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The EAC's five countries -- Burundi, Kenya, Rwanda, Tanzania, and Uganda -- have made astoundingly rapid progress since the bloc was re-launched in 2000. (An earlier union of Kenya, Tanzania, and Uganda dissolved in 1977, ten years after its founding.)
On paper, at least, the EAC has harmonized rules and tariffs and guaranteed the free movement of labor, capital, goods, and services among member states. In the EU, this occurred through the acceptance of the Acquis Communautaire, the body of EU law. In the EAC it has, so far, meant adoption of a common market and customs union, joint judicial and legislative bodies, and measures such as the mutual accreditation of higher education institutions.
The EAC's progress offers a welcome, if little-noticed, argument that the Euro's troubles need not discredit the EU's model for integration. There is no need to throw out the baby with the bathwater. Indeed, economically, the EAC has an enormous amount to gain from integration. According to the latest data in the World Bank's global poverty statistics, 81 percent of Burundians, 43 percent of Kenyans, 63 percent of Rwandans, 68 percent of Tanzanians, and 38 percent of Ugandans live on less than $1.25 per day. IMF data show that GDP per capita is only $850 in the wealthiest EAC country, Kenya. In Burundi, the poorest, it is just $279.
Each EAC member economy is also small in the aggregate. Kenya, the largest of the five, has a 2011 GDP of only $35 billion, according to the IMF -- about the same as South Dakota. This suggests that integration could unlock tremendous growth and economies of scale.