February 28, 2024

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Seizing new opportunities: Somalia Joins the East African Trade Bloc

An aerial view of Mogadishu skyline looking towards the city centre and central business district of the Somali capital, August 05, 2013.

The East African Community trade bloc admitted Somalia as its eighth member on Friday, Somali authorities and businesses hope that their country’s economy, which has been severely damaged by war will benefit from this move.

The EAC common market, which was established in 2010 and presently includes nearly 300 million people, is made up of Burundi, Democratic Republic of Congo, Kenya, Rwanda, South Sudan, Tanzania, and Uganda.

“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 grown its market and gained access to a coastline that stretches over 3,000 km (1,800 miles) and may contain offshore resources like gas and oil.

Somalia can now take advantage of the bloc’s substantial population, established customs union, and common market, which attract investors.

Although the EAC has made strides toward economic integration over the years, it has, like many other trade blocs, had difficulty overcoming obstacles to trade, such as bureaucratic obstacles, unstable political environments, inadequate infrastructure, and trade disputes.

Somalia, which has a population of about 17 million, had sought to join the EAC for years, but analysts say that because of its ongoing instability, some East African nations were hesitant to grant it membership.

Since 2006, the Mogadishu government has been subjected to a brutal insurgency by al Shabaab, an organization affiliated with al Qaeda. Concerns about how EAC integration might facilitate the flow of illegal goods and militants throughout the region have been expressed by certain officials.

Following over a decade of closure, Kenya had planned to reopen its border with Somalia, but plans were delayed earlier this year due to an increase in attacks in Northern Kenya by fighters believed to be part of al Shabaab.

Businesses in Somalia expressed optimism that the country’s thriving private sector, which has persevered in the face of adversity to remain afloat, would introduce new, risk-taking businesspeople into the trade bloc and foster exchanges throughout the sizable Somali Diaspora.

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

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