Louis Kasekende, Deputy Governor of the Bank of Uganda and former Chief Economist of the African Development Bank (AfDB), underscored the importance of economic integration as key to sustainable growth in East Africa during a seminar on Regional Integration in East Africa organized by the African Development Institute (EADI) and the AfDB’s Development Research Department (EDRE) in Tunis on October 5.
In his keynote address, Mr. Kasekende stated that the time for Africa to take a lead in global growth had come, but emphasized that African countries needed to accelerate structural reforms so as to generate more sustainable growth over the long term. One way to ensure this, he noted, was through regional integration. He then cited the successful emerging economies in East Asia, where structural transformation has almost always been driven by growth in trade. This has largely occurred thanks to strong, mutually reinforcing linkages between competitiveness and trade, he added.
He recalled AfDB President Donald Kaberuka’s August speech to the Annual Conference of Speakers of African Parliaments, which called for a deepening of African economic integration to put an end to the Balkanization of the continent. The AfDB has made regional integration a priority, with a US $11-billion commitment over five years to build needed infrastructure to support regional trade in Africa.
Uganda’s long-term vision is to transform its economy to middle income status. Over the last two decades, the country’s growth has averaged more than seven per cent in real terms, but there has been little structural transformation of the economy. Mr. Kasekende argued that transforming Uganda into a modern and prosperous country could best be secured through a deepening of regional economic integration in East Africa, under the auspices of the East African Community (EAC). However, he acknowledged that regional integration would unavoidably entail ceding many elements of national sovereignty to the region.
According to Mr. Kasekende, the three main advantages of regional integration for Uganda and its East African partners include access to regional markets; competition that will enhance efficiency and productivity; and improved access to factor and material inputs. However, these elements will only be realized, he said, if there is genuine economic integration with no restrictions on the movement of goods, services, labour and capital within the EAC. If individual countries bow to sectional interests and try to maintain protection for domestic producers or domestic workers, the benefits of economic integration for the wider economy will be lost, he argued.
The former Chief Economist cited presentation and positioning of Africa as the next frontier for global development among his achievements during his three-and-half year stay in the Bank.