Saturday, June 22, 2024

Somalia joins East African Community

BY REUTERS: The East African Community trade bloc admitted Somalia as its eighth member on Friday, a move Somali authorities and businesses hope will boost the country’s war-ravaged economy.

The EAC common market – which consists of Burundi, Democratic Republic of Congo, Kenya, Rwanda, South Sudan, Tanzania and Uganda – was set up in 2010 and currently comprises almost 300 million people.

Co-Op post

“Somalia officially joins the East African Community, reinforcing ties and opening new doors for progress and partnership,” Daud Aweis, Somalia’s minister for information, culture and tourism said in a post on X, formerly Twitter.

With the new member the bloc has expanded its market and also gained an additional new coastline stretching over more than 3,000 km (1,800 miles) that holds potential for offshore resources like oil and gas.

NCBA

In turn the bloc’s large population and existing customs union and common market are a draw for investors that Somalia can now tap into.

Although the EAC has over the decades made progress in economic integration, like many other trade blocs it has struggled to overcome barriers to commerce like red tape, political instability, poor infrastructure and trade disputes.

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Somalia, which has a population of about 17 million, had sought to join the EAC for years, but its chronic instability has made some East African countries reluctant to grant it membership, analysts say.

Al Qaeda-linked al Shabaab has waged a brutal insurgency against the Mogadishu government since 2006. Some officials have voiced concerns that EAC integration could ease the movement of militants and contraband across the region.

Kenya postponed plans earlier this year to reopen its border with Somalia after more than decade of closure due to a surge in attacks in northern Kenya by suspected al Shabaab fighters.

Somali businesses said the country’s vibrant private sector, which has overcome long odds to stay afloat, would bring a fresh injection of risk-tolerant entrepreneurs into the trade bloc and boost exchanges across the large Somali Diaspora.

“It will be simpler for the large Somali Diaspora living across East Africa to access financial services and products,” said Shuayb Haji Nur Mohamed, managing director of Salaam Somali Bank, one of Somalia’s major banks.

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