EAC to be free from donors: EAC plans to fund itself through import tax

AfPoliFed · 2014-03-24T04:32:02+00:00

By LUCAS BARASA, Daily Nation The East African Community is looking for ways of funding its own activities to be self-reliant. Deputy Secretary General Jean Claude Nsengiyumva said since EAC is working on a fully-fledged single customs territory, it is crucial for it to fund itself. Mr Nsengiyumva said the issue of funding would feature prominently during the Heads of State and Government extra- ordinary meeting in April. Mr Nsengiyumva said during an interview in Bujumbura that his priority since taking office has been seeing how EAC is funded. Currently the budget of the Community is funded by equal contributions by the Partner States and receipts from regional and international donations and the development partners he said. Most of the EAC projects are still being funded by donors with the EAC budget being approximately US$130-140 million which is not enough to implement all the projects and the programmes of the community. Due to the limited resources, we have been funding our projects by prioritizing the most crucial ones, he said. He said proposals have been made to the regional body to start funding itself through one percent tax on all imports from outside the community. He said the proposal was sent to the EAC Council Ministers and forwarded to November 2013 Summit of the Heads of State. FINANCIAL SOLIDARITY The EAC secretariat was instructed to propose a financing mechanism including the option of one percent tax on imports from outside the community while bearing in mind the disparities in economies of the member states, Mr Nsengiyumva said. The secretariat will have to consider a principle of financial solidarity and equity so that the economies are not looked how weak or how strong they are, he said. He added: We are all one people with one destiny. We also have to consider the equity and solidarity so that partner states will feel comfortable in their respective economies that they are also equally treated. That is the assignment given by the heads of state in their wisdom. The secretariat is now working to improve the proposal and once the proposal is adopted, EAC will change drastically and look like any other developed region, he said. A survey has shown that EAC could collect US$134 million if the one percent tax on imports is implemented. The secretariat is said to be working on a better mechanism whereby the money will be collected and transferred to a specific account of the EAC. Mr Nsengiyumva said a lot of progress has been made on developing the optional sustainable mechanism for EAC to fund itself. It is a revolution for EAC to fund itself. The pledges and contribution of the development partners have started decreasing, he said. comments Raiyaa 19 hours ago hmmm, sounds like a good idea but is it achievable? I bet the donors would do everything to make it a failure

Thread starter AfPoliFed
Start date Mar 24, 2014

AfPoliFed

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EAC to be free from donors: EAC plans to fund itself through import tax

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