Francis A.S.T. Matambalya is a Tanzanian national and Senior Lecturer in the Faculty of Commerce and Management of the University of Dar es Salaam. He holds a B. Com. Degree (Majoring in Marketing) of the University of Dar es Salaam, an MSc. Degree in Business Administration (Majoring in Marketing and Business Informatics) from Johannes Kepler University (Linz, Austria) and a Ph. D. Degree (International Economic Relations) from Ruhr University (Bochum, Germany). His main area of research is international trade and international economic relations, in which he is an outstanding scholar and author of several articles and three books.

Abstract
- In this paper, the author critically analyses the accuracy of perceiving the Great Lakes Region (GLR) of Central and Eastern Africa as constituting one political region, and examines the prospects of the same to constitute one economic region. In this context, considering the central role played by trade in facilitating economic integration, the author looks at prospects for accelerating movement towards economic integration the GLR. He argues that, regional integration is a viable prospect, but certain crtitical conditions must be met, if it is to be realised. Along these lines, he summarises the forces that precipitate regional integration, and critically examines viable modalities of economic integration in Africa, involving the GLR economies.

Key words:    Chimurenga, dysfunctional ity of institutions, "flying geese" phenomenon, geogra­phy of regionalisation, institutions of national unity, "ripple effects" phenomenon.

A. The Great Lakes Region

Of late, but particularly following the political turmoil and carnage in Rwanda in 1994, the incessant crisis in Burundi, and the events in the Democratic Republic of Congo (DRC), Central and Eastern Africa as a region has attracted substantial attention from the international community. The focus of the debate on the economic and political events in the region has enriched the terminology with respect to the geography of regionalisation in Africa, by giving birth to the idiom, the Great Lakes Region (GLR).

In this context, the debate on political events in Africa has recently tended to refer to such countries as, Burundi, Democratic Republic of Congo(DRC), Kenya, Tanzania and Uganda , as constituting one political region, the GLR .This categorisation puts toogether such trouble  spots in Central and Eastern Africa as Burundi, DRC and Rwanda ;and their relatively stable neighbours, i.e., Kenya, Tanzania and Uganda, which experience  ripple effects due to the instability in the former group of states.

Notably, as the most preferred destination for refugees, Tanzania in particular suffers heavily from the ripple effects of developments in Burundi, the DRC and Rwanda. Also, Uganda has repeatedly expressed concerns about its security. Moreover both Uganda, and to a lesser extent Kenya, hold stake in Burundi, the DRC and Rwanda: the former because of its aspirations to be a regional power broker, and the latter mainly due to its economic interests. Hence, while Uganda has actively intervened to shape the course of political events in Rwanda and the DRC and continues to do so, Kenya is affected due to its geo­graphical proximity to the trouble area and its role as the leading economy in the region.

B. The Dynamics of Trade, Regional Economic Relations, and Economic Growth

Over several years, but particularly in the last two decades, international economic relati­ons have been characterised by intensive of international economic interactions, fortifying further the interdependence between individual countries and groups of nations. These international economic interactions express an important dimension of a multi-dimensional phenomenon, currently commonly referred to as globalisation.

In economic terms, globalisation means closer integration of national economies and/or economies of groups of nations with each other. The related formation and/or consoli­dation of such trading blocs as the European Economic Community (EEC) which later transformed in the European Union (EU), the North American Free Trade Areas (NAFTA), Mercado Comttn del Sur (MERCOSUR)l etc., at the regional level of international economic integration, have resulted into substantial increases in international flows goods and services, and factors of production (including financial resources).

At the global level, the international economic integration is propelled by the systematic lowering of trade barriers resulting from multilateral negotiations within the framework of the multilateral trading system (MTS), spearheaded by the World Trade Organisation (WTO). These changes are bound to increase even further the opportunities for and growth of international trade.

C. Focus and Structure of the Paper

In this paper, the author critically examines the prospects for economic integration among the GLR states. Hence, part II contains and overview of the political orientation of the GLR states, while part III presents the current policy framework for international trade interactions of the GLR states. Part IV explores the involvement of the GLR states in other international co-operation arrangements, while part V highlights the restraints for realising economic integration of GLR economies. Part VI presents the strategic reflections on a functional economic integration of the GLR states, and the concrete options for linking the GLR economies to their other African partners are presented in part VI. Finally, the conclusions are presented in part VIII.

II. Overview of the Political Orientation of the States of the Great Lakes Region

Though they are all developing economies, which are additionally united by their history, and geography, the GLR States of Central and Eastern Africa experience substantially differing levels of not only economic, but also political and social development.

In this regard, the inter-country differences are probably most clearly verified by the
forms of government, as a proxy for political orientation. While Kenya, Tanzania and Zambia embraced the principal of multi-party democracy, and embarked on the thorny road towards establishing it, the regimes in Burundi and Rwanda are still de facto military, drawing their mandate from the power of the gun. In between the two extremes, Uganda is experimenting with an io ipso, uni-party democracy, the "Movement" version.

Some statistical facts of GLR states are presented in table 1. Notably, the region contain the third largest country in Africa, the DRC, but is also host to some of the smallest states in Africa, i.e., Burundi and Rwanda.

Table 1: Selected Facts of the GLR States
 
 
 
 

COUNTRY		Area in 000 km2	Population Mil.,1999	GDP per Capita US $  in 1999	Form of Govenment
The EAC	Economies
1.	Kenya	580	30	10 638	Multiparty Democracy
2.	Tanzania	947	32.9	8 760	Multiparty Democracy
3.	Uganda	236	21.5	6 411	"Uni-party" Democracy
The other GLR	States
4.	Burundi	28		714	De facto military
5.	DRC	2 345		7 752
6.	Rwanda	26	8.3	1 956	De facto military
7.	Zambia*	753	9.9	3 150	Multiparty democracy

Sources: (1)ibrd/undp 1992:10,(2)IBRD/UNDP 2001:19,(3)newsafrica.com

III. Overview of the Policy Frameworks for International Trade Interactions of the GLR Economies

The policy frameworks for intra-regional and international trade interactions of the GLR economies are influenced by a set of partly interlinked forces, which however emanate at various levels. In this regard, the trade practices of the GLR economies are directly or indirectly affected by the provisions of various regional trade arrangements (RTAs), bilateral trade arrangements (BTAs) and the NITS as spearheaded by the WTO.

A. The Involvement of the GLR Economies in Regional Integration Initiatives

The GLR economies are engaged in regional trade arrangements of various stripes and with varying composition in terms of membership. For analytical purposes, these can be categorized into RTAs with direct and indirect involvement of at least some GLR economies respectively.

a. RTAs with Direct Involvement of Individual GLR Economies

The GLR economies participate in several RTAs. While most are members of the Com­mon Market for Eastern and Southern Africa (COMESA), three of them are also members of the East African Community (EAC), and two the Southern African Development Com­munity (SADC). Table 2 depicts membership of the GLR economies and their African partners, in various RTAs and the WTO. In order to highlight the links to Southern Africa, the member states of the South African Customs Union (SACU) are also shown.

Table 2: Membership to International Trade Protocols by GLR Economies and their Partners African Economies
 
 

GLR Economies
		COMESA	EAC	SACU	SADC	WTO
1.	Burundi	*				*
2.	DRC	*				*
3.	Kenya	*	*			*
4.	Tanzania	*	*		*	*
5.	Uganda	*	*			*
OTHER	MEMBER	COUNTRIES
1.	Angola	*			*	*
2.	Botswana	*		*	*	*
3.	Lesotho	*		*	*	*
4.	Malawi	*			*	*
5.	Mauritius	*			*	*
6.	Mozambique	*			*	*
7.	Namibia	*		*	*	*
8.	Seychelles	*			*	*
9.	South Africa				*	*
10.	Swaziland	*		*	*	*
11.	Zambia	*		*	*	*
12.	Zimbabwe	*			*	*

Notes: COMESA ... Common Market for Eastern and Southern Africa, EAC ... East African Community, SACU .. Southern African Customs Union, SADC ... Southern African Development Community, WTO ... World Trade Organisation, . ... denotes country membership in the scheme.

1. COMESA Trade Regime

The idea to form COMEsa is an old one, going back to 1965, when the representatives from governments of Eastern and Southern African countries meeting in Lusaka recommended the creation of an Economic Community of Eastern and Southern African States. Subsequently, in 1978 a meeting of the regions government ministers recommended the creation of a regional trade bloc, beginning with a  Preferential Trade Area (PTA). Eventually, a PTA was established in 1982, and replaced by COMESA in 1994.

Generally, the 1990s have seen recognition that a more outward oriented approach to international trade will enable the full benefits of the trading bloc. The member countries hope that the development of COMESA as a free trade area (scheduled by 31 December the year 2000) and a Common External Tariff (CET) by 2004.

The evolution into a common market and an economic union is expected to lead to sustainable economic development and political stability in the region.

2. EAC Trade Regime

Article 5 of the Treaty of the EAC on the Objectives of the Community, specifies in para­graph 3, inter alia that, the Community shall ensure the strengthening and consolidation of, (i) co-operation in agreed fields that would lead to equitable economic development within the partner states and which would in turn, raise the standard of living and improve the quality of life of their populations; and (ii) long standing political, economic, social, cultural and traditional ties and associations between the peoples of the partner states so as to promote a people centred mutual development of these ties and associations.

Therefore, the EAC is also working on the institutionalisation, at the regional level, of co-operation in trade. Maasdorp and Hess (1999) in a report prepared for the EU recommends the establishment of an EAC Trade Protocol.

3. The SADC Trade Regime

As an integration scheme, the SADC is one of the latest additions to similar initiatives in Southern Africa. Formally, it was established in August 1992 through the Windhoek Treaty, to replace the Southern African Development Co-ordination Conference (SADCC).

The SADCC, on its turn, was established through the Lusaka Declaration of 1980 by the then five Front-line States, i.e., Angola, Botswana, Mozambique, Zambia and Zimbabwe. The frontline states, in this context, referred to the states which were on the forefront in the struggle against the apartheid system in the Republic of South Africa (RSA). Its key objective was to lessen the economic dependence on the apartheid RSA.

This objective was inherited by the SADC. Following the election of 1994, which paved the way for the dismantling of the apartheid system, the RSA joined the SADC as its 10th member in 1994. This brought a new reality to integration efforts in Southern Africa, heavily boost the chances of the SADC as a tool for the development of the region.

The SADC trade regime is expressed by the SADC Trade Protocol. The Protocol was the result of the Maseru Summit of 1996. This Protocol, which technically presents a Framework Agreement, is an interim arrangement, which should be systematically strengthened and in 2008, transformed into a fully-fledged Free Trade Area, in compliance with Article XXIV of the GATT, revised in 1994.

The protocol is relatively comprehensive, containing 39 Articles and five annexes. Being a trade protocol, all its articles are logically relevant for trade. They jointly aim to systematically remove intra-SADC trade barriers, and turn the region in a free trade area (FTA) by 2008.

b. RTAs with Indirect Links to Individual GLR Economies

I. The SACU and SADC Trade Regimes

The SACU trade regime is also important for the GLR economies, because some of the SACU member states are tied to GLR economies through other RTAs. In particular,

(i) None of the GLR economy is a member of SACU. However, within the SADC forum, the DRC and Tanzania work together with all SACU economies. Also, within the COMESA forum, four GLR economies (i.e., Burundi, Kenya, Rwanda and Uganda) work together with several SACU economies (i.e., BLNS States).

(ii) Four GLR economies (i.e., Burundi, Kenya, Rwanda and Uganda) are not members of SADC. Nonetheless, within the COMESA forum, they work together with several SADC economies (i.e., Angola, BLNS States, Malawi, Mauritius, Mozambique, Seychelles, Zambia, and Zimbabwe).

Overall, the existence of several regional integration initiatives, though with varying membership, ensures that the GLR economies are (directly or indirectly) engaged in formal economic co-operation arrangements with all economies in Southern Africa.

2. Inter-Group Co-operation Arrangements

At a secondary level, co-operation between regional blocks to which GLR economies subscribe and other regional blocks, constitute developments which will affect the trade policies and practices of the GLR economies. The SADC, for instance, has signed a co­operation agreement with the Association of South East Asian Nations (ASEAN), and made initial moves to introduce relationships with the MERCOSUR and the NAFTA.

B. The GLR Economies and Bilateral Trade Arrangements

a. The Cotonou Agreement

Because of their past colonial linkages, traditionally all the GLR economies have been lin­ked to some European economies. Among the existing BTAs, the linkages between the EU and GLR states through co-operation between the EU and the African Caribbean and African (ACP) group of nations is the longest lasting one. Initially the pertinent linkages took the GLR (colonised) states being appendages to the EU colonial powers. However, as most colonised states became independent, the linkages took other forms of arrangements.

Hence, among the GLR economies, Burundi, DRC, and Rwanda already were linked with the European Economic Community (EEC)through the Younde I Agreement betweeen the EEC and Association of African States and Madagascar (AASM). Kenya, Tanzania and Uganda followed suit in 1968, through the Arusha Association Agreement between the EEC and the (first generation) East African Community (EEC). These relations were main­tained through Youndd 11 Agreement, and the Lome I to IV Conventions (1975-2000).

After the expiration of the Lome IV, which linked the EU to its ACP states from 1990 to 2000, all the GLR economies signed the Cotonou Agreement, which now links the European Union (EU) and 77 African, Caribbean and Pacific (ACP) states (table 3). The New Partnership Agreement was signed on 23 June, in Cotonou, the capital of Benin. It will govern EU-ACP co-operation in the next 20 years.

Economic and trade co-operation constitute one of key pillars of the Cotonou Agreement. In this context, the EU and ACP states agreed to conclude "trading agreements, removing progressively barriers to trade between them and enhancing co­operation in all areas relevant to trade" (Article 36.1). In line with the new Agreement, EU­ACP trade will build on the so-called economic partnership agreements (EPA), which shall consist basically of free-trade areas (FTAs) between the EU and groups of ACP countries.

The Agreement further provides that for those countries that see themselves "not in a position to enter into economic partnership agreements (...), all alternative possibilities will be examined, in order to provide these countries with a new framework for trade which is equivalent to their existing position and in conformity with WTQ rules" (Article 37.6. Also, for the least developed countries (LLDCs) among the ACP States, an improved generalised system of preferences (GSP) might provide an alternative to EPAs. Notably, all but one of the GLR economies fall in the category of LLDCs: Kenya is the only exception.
 

Table 3: List of WTO membership and LDC status of ACP countries
 

Country	WTO Member	LDC
Angola	+	+
Antigua and Barbuba	+	_
Bahamas,The	_	_
Barbados	+	_
Belize	+	_
Benin	+	+
Botswana	+	_
Burkina Faso	+	+
Burundi	+	+
Cameroon	+	_
Cape Verde	_	+
Central African Republic	+	+
Chad	+	+
Comoros	_	+
Congo.Dem.Rep	+	+
Congo,Rep	+	_
Cook Islands	_	_
Cote D'Ivoire	+	_
Djibouti	+	+
Dominica	+	_
Dominican Republic	+	_
Equitorial Guinea	_	+
Eritrea	_	+
Ethiopia	_	+
Fiji	+	_
Gabon	+	_
Gambia,The	+	+
Ghana	+	_
Grenada	+	_
Guinea	+	+
Guinea-Bissau	+	+
Guyana	+	_
Haiti	+	+
Jamaica	+	_
Kenya	+	_
Kiribati	_	+
Lesotho	+	+
Liberia	_	+
Madagascar	+	+
Country	WTO Member	LDC
Malawi	+	+
Mali	+	+
Marshall Islands	_	_
Mauritania	+	+
Mauritius	+	_
Micronesia,Fed,Sts.	_	_
Mozambique	+	+
Namibia	+	_
Nauru	_	_
Niger	+	+
Nigeria	+	_
Niue	_	_
Palau	_	_
Papua New Guinea	+	_
Rwanda	+	+
Samoa	_	+
Sao Tome and Principe	_	+
Senegal	+	_
Seychelles	_	_
Sierra Leone	+	+
Solomon Islands	+	+
Somalia	_	+
South Africa*	+	_
St.Kitts and Nevis	+	_
St.Lucia	+	_
St.Vincent and the Gr.	+	_
Sudan	_	+
Suriname	+	_
Swaziland	+	_
Tanzania	+	+
Togo	+	+
Tonga	_	_
Trinidad and Tobago	+	_
Tuvalu	_	+
Uganda	+	+
Vanuatu	_	+
Zambia	+	+
Zimbabwe	+	_
Sum:      77	55	39

Source: Matambalya and Wolf 2001: 142.
Notes: + denotes membership to the specified group, - denotes none membership to the specified group,* . .... South Africa has a separate trade regime with the EU, therefore the trade provisions of the Cotonou Agreement are not applicable for it.

In the form adopted in Benin, the Cotonou Agreement is a Framework Agreement. Hence, negotiations on the details of co-operation are scheduled to commerce in September 2002. Essentially, the trade policies of the GLR economies will (due to their ACP membership status) have to be in harmony with the provisions-of the Cotonou Agreement and the subsequent agreements that will be reached through the detailed negotiations.

b. The Generalised System of Preferences

The Generalised System of Preferences (GSP) is a system, of preferential trade regimes that was negotiated under the auspices of the United Nations Conference on Trade and Development (UNCTAD). The GSP measures are designed at stimulating development in the preference-receiving (hence, beneficiary) economy by, (i) increasing the export earnings, (ii) promoting industrialisation, and (iii) accelerating the rate of economic growth. International trade preferences modelled upon GSP have provided the conventional tools for developed economies to extend trade preferences to developing economies (mainly LDCs, but in some cases also LLDCs).

The product covered in the various GSP cover mainly manufactured and semi­manufactured goods, falling within chapters 25-97 of the Harmonised Commodity Description and Coding System. However, several products (e.g., textiles, leather, chemical products) are excluded. Also, some agricultural products of chapters 1 to 24 of the Harmonised Commodity Description and Coding System, are included.

Currently, the preference-giving (hence, the donor) countries include, Australia, Belarus, Bulgaria, Canada, and the Czech Republic. Others are the EU, Hungary, Japan, New Zealand, Norway, Slovak Republic, Russian Federation, Switzerland, USA.

c. The AGOA

The African Growth Opportunity Act (AGOA) of 2000 is a special version of a GSP, tailor-made by the government of the USA for African States. Among the GLR economies, Kenya, Tanzania and Uganda qualify for AGOA preferences. In the African context, it is currently, the most known GSP.

Thirty four African states (cf. table 4) qualify for AGOA, including most GLR states. However, in reality, only Kenya has the critical capacity to meaningfully use the benefits.

Table 4: Sub-Saharan African States Designated as Eligible for the Benefits of the AGOA as of 2nd October, 2000
 

GLR Economies
1.Benin	7.Congo	13.Guinea	19.Mali	25.Nigeria	31.RSA
2.Botswana	8. Djibouti	14.Guinea-Bisau	20.Mauritania	26. Rwanda	32.Tanzania
3.Cape Verde	9.Eritrea	15.Kenya	21. Mauritius	27.ST and PP	33.Uganda
4. Cameroon	10.Ethiopia	16.Lesotho	22.Mozambique	28.Senegal	34.Zambia*
5.CAR	11.Gabon	17.Madagascar	23. Namibia	29. Seychelles
6. Chad	12.Ghana	18. Malawi	24.Niger	30. Sierra Leone

Notes: CAR ... Central African Republic, ST & PP ... Sao Tome and Prince Pe, RSA .. Republic of South
Africa. The italics indicate GLR state, * also sometimes mentioned as a GLR state.

C. The GLR States and the Multilateral Trading System: The WTO Trade Regime

Also, all the GLR economies subscribe to the WTO (table 1). Hence, their trade policies
must be WTO-compatible. Being a trade arrangement, all the provisions of the WTO are directly relevant of trade.

The WTO provisions provide the base of international trade relations. The main characteristics features of the WTO trade regime are tariff reduction and reciprocity in trade concessions. Tariff reductions are usually on most-favoured nation basis (Article 1). Notably, Article 1 is the cornerstone of the WTO trade regime, and obliges all member countries to extend MFN treatment to all other WTO member countries.

Also, the WTO provides the formation of closer regional co-operation. In this context, among other things, Article XXIV on the formation of customs territories, and the Enab­ling Clause are imperative. The later is the result of the Tokyo round (1979). Presenting an exception to Article 1, it provides a legal base for developed country preferences in favour of developing countries, through the differential and more favourable treatment.

IV. Involvement of the GLR States in other International Co­operation Arrangements

The GLR economies are also involved in other international co-operation arrangements,
which are relevant for their economic development. These regional co-operation initiatives

Table 5: Membership in other International Economic Co-operation Programmes by GLR Economies
 

GLR	Economies
		IGAD	IOC	CBI	KBO	IORARC
1.	Burundi				*
2.	DRC
3.	Kenya	*				*
4.	Rwanda	*			*
5.	Tanzania				*	*
6.	Uganda	*			*
Southern Afric	an Economies
1.	Angola
2.	Botswana
3.	Lesotho
4.	Malawi
5.	Mauritius		*
6.	Mozambique					*
7.	Namibia
8.	Seychelles		*
9.	South Africa					*
10.	Swaziland
11	Zambia
12.	Zimbabwe

 

(RCIs), are also of various stripes and contain various membership profiles. Table 2 depicts the partners of the GLR economies in the most important of such arrangements, i.e., Intergovernmental Association for Development (IGAD), Indian Ocean Commission (IOC), Cross-Border Initiatives (CBI), Kagera Basin Authority (KBO), and Indian Ocean Rim Association for Regional Co-operation (IORARC).
 

V. Constraints to the Enhancement of Economic Co-operation Among the GLR Economies of Central and Eastern Africa

The promotion of economic linkages among the GLR economies beyond the current level will also need careful assessment of several key issues. The pertinent issues can be clustered into inter-related challenges of economic, political, and technical nature.

A. The Constellation of the GLR Economies

The constellation of the GLR economies is a source of challenges of economic nature. Invariably, such challenges reflect the im­maturity of the GLR economies, and the restricted economic dynamism thereof.
In this context, there are several challenges, the two most prominent being, intra­national economic fractionalisation and the, by and large, non-complimentary nature of the economies. The others are the absence of "flying or lead geese" to propel the integra­tion, the low degree of intro-regional economic ties, the predominance of external orientation of the individual economies in the region.

Box. 1: Economic Challenges Integration among the GLR economies is likely to be affected by several challenge of economic nature, including:

• Intra-national economic fractionalisation.
• Non-complimentary nature of the individual GLR economies.
• Absence of 'flying geese".
• The low degree of intro-regional economic ties.

As pointed out by Collier and Gunning (1998), in many African states, even the private sector is fractionalised along ethno-racial parameters. Hence, the "Asian African" sector usually operates alongside the "African African" sector, with restricted interactions.
The FDI sector presents another dimension of fractionalisation. In Tanzania, for instance, the stringent banking procedures and requirements of such banks as Standard Chartered and STANBIC, which invested in the country following liberalisation, by and large exclude the "African African" business sector.

Overall, the intra-national economic fractional isation is a further manipulation of the phenomenon of deficits in institutions of national unity. It underscores the deficiencies belying the not only the public, but also the private business sector in the GLR economies, which also evident in many other African states.

Hence, these developments underscore the need to invest in the creation of minimum adequate conditions for development in quite a number of the countries, before they can be useful members of an effective integration scheme (Collier et al. 1998, Matambalya 2000).

b. The Non-Complimentary Nature of the GLR Economies

All GLR economies are basically agrarian Generally, these economies stay in production complementarity with developed economies in Europe, America, Japan, etc. Invariably, because they produce similar products, there is little room for intra-regional complementarity in production, and therefore regional trade.

Also, intra-industry trade (IIT)l is restricted by the absence of product differentiation, which normally characterises agricultural raw materials and foodstuffs.

c. Absence of "Flying Geese" to Propel Regional Integration

For regional economic integration schemes to be successful, they need a critical mass of
economic force. Invariably, most economic integration schemes have benefited from the presence in the programme of a strong economy or several strong economies, which sort of provides the motor for development. Customarily, a lead goose is a global player as well.

Hence, concrete reference to the phenomenon is made in connection with the dynamics of economic co-operation in various regions of the world. In this regard, Japan is credited with a lead goose role in South East Asia, with newly exporting economies (NIEs) rated as second rank geese, and Indonesia, Malaysia, Philippines, and Thailand as third rank geese (cf. Darga 2001). Analogously, Germany is credited with a similar role, closely followed by France in the integration-driven rebuilding of Western Europe after the Second World War.

The current trends in Africa suggest that infra-regional links, founded upon the flying geese phenomenon, is
utmost, a distant reality. Africa is peculiar in the sense that in addition to restricted infra-regional economic interactions in trade and investments, neither are lead economies serious the lead economies in each integration
scheme on the continent global players, nor are they strong enough to spearhead regional development.

Box 2: The Flying Geese Phenomenon The flying geese phenomenon assumes:

• A group of economies, having synergies and closely interacting with one another.
• International economic interactions in the group, propelled by trade and investments.
• Economic interactions led by the prominent economy.
• Provision of markets, complimentary inputs, and know how, by the prominent economy.

The current level of integration in GLR economies is substantially below the required threshold to support a functional regionalisation. As indicated in table 2 for selected coun­tries, infra-regional trade is very low (IDIL 1999, Matambalya 2000).

Even if the comparison is restricted to the three EAC economies, the picture for is not much better. Although the EAC brings together countries with a long common history, lan­guage and strong affinities in other cultural aspects, economic integration remains low. In 1995, Kenya's imported from and exports to the other two EAC members were only 1.1 percent and 9.3 percent respectively. The figures for Tanzania were 4.5 percent and 5.4 percent respectively, while those for Uganda were 2.2 percent and 3.9 percent respectively (CREDIT 1998, Matambalya 2000).

Of particular importance for the GLR states is that, besides being a member of the SADC and the SACU, South Africa has signed a separate FTA with the EU, a move which poses several challenges by: (i) Complicating South Africa's linkage to the other economies in the region.
(ii) Expressing incoherent multiple linkages between the region and its external partners (in this case, the EU).
(iii) Complicating the prospect of adopting integration based on the „intensity of regional homogeneity'`, even if the „pan-Africanist" approach is adopted.
(iv) Making the application of the formula of variable geometry more complex, if the region is to grow as a unified economic entity.

b. Pervasiveness of Chronically Dysfunctional States

One of the key barriers to the enforcement of development program­mes in developing countries is the plight of dysfunctional institutions in many of them. In essence, the dysfunctional ity of states observed in the GLR States of Central and Eastern Africa express an extreme case of institutional dysfunctional ity, which technically denotes the compounding of the problem of the absence of institutions of national unity.

Therefore, now of the 7 GLR states, 4, i.e., Burundi, DRC, Rwanda and Uganda (equivalent to 50 percent) are involved in civil war or armed conflicts of different intensity. Some occurrences in other places of the region, such as in Kenya (e.g., the frequent fatal ethnic clashes in the Rift Valley Province and recent fatal riots in Kariobangi, Nairobi city) and Tanzania (e.g., the January 25th to 27th 2001 clashes in Zanzibar which had all signs of  racial sentiments) suggest that even these countries,which are the craddle of peace and stability in the GLR and Africa generally,donot fully satify the criteria for functionality.

Box. 4: Dysfunctional institutions
in its reference to dysfunctional institutions, the Green Paper (EU 1996) defines countries as dysfunctional, if they are characterised by:

•  Political instability.
• Weak government institutions. Rising crime.
• Organised violence.
• Armed conflict.

(b) It reduces social trust and trust in state institutions. This is exacerbated by the perception of institutions as representing only one social group (e.g., race, ethnic groups, etc). Again, here the confidence of the people in the governments in Burundi and Rwanda are a constant reminder the uphill task ahead for the GLR states.

Box. 5: Costs o f Dysfunctional States Dysfunctional states are expensive to the state and the host region because of..
• The internal Misplacement of people.
• The flow of refugees to neighbour states.
• The erosion of social trust and trust in state institutions.
• The ripple effect on neighbours.
• The erosion of international confidence in the region.

(c) It has a ripple effect on neighbouring countries. Thus dysfunctional states cause econo­mic and social costs to neighbouring countries associated with refugees, migration, ex­port of ideologies of mono-ethnic thinking, environmental degradation, etc. The huge Rwandese, Burundian, and DRC diaspora is a living testimony of the ripple effects in such peaceful neighbour states as Tanzania.

(d) It reduces international confidence in the region. Notably, while the picture of,a war­torn region lingers on long after the end of the actual conflict, they also spark investor scepticism and discourage foreign direct investments (FDIs), and encourage capital flight (Bheenick 1998, Matambalya 2000).

Also empirical studies have rated political instability very high among the major causes to the limited achievement of integration in Eastern and Southern Africa (Langhammer and Hiemenz 1990, Matambalya 1995).

c. Vulnerability to External Influences

The basic problems of political nature in the GLR can be better understood by making

C. Challenges of Technical Nature

There are also several challenges of technical nature, and which therefore need Generally, the technical solutions.The most prominent of them are the proliferation of regionalisation schemes covering GLR states of Central and Eastern Africa, the multiple memberships of GLR economies in RTAs, as well as other RCIs.

Box. 6: Technical Challenges for Regionalising the GLR States

Generally, the tehnical challenges to regionalisation of the GLR states are underlined by:

• The proliferation of regionalisation schemes
• The multiple membership of the GLR states in RTAs.
• The multiple membership of the GLR states in RCIs.

a. Proliferation of Integration Schemes

The proliferation of regionalisation schemes is one of the greatest challenges to the determ­ination of the appropriate geography of regionalisation in Africa in general. As pointed out above, the GLR states are currently engaged in 3 major integration schemes, i.e., COMESA, EAC, and SADC. Besides, there are several more integration schemes, i.e., the CBI, IGAD, IORARC, KBO. Also, several countries maintain bilateral arrangements in different forms, e.g., development corridors. Such arrangements exit between, for example.

C. Challenges of Political Nature

The three leading challenges of political nature are expressed by the deficits in institutions of national unity, the prevalence of chronically dysfunctional states, and the vulnerability to external influences.

Box. 3: Political Challenges
Challenges of political nature invariably express the political immaturity of the GLR states. In this regard, the GLR states are characterised by:

• Deficits of institutions of national unity.
• Chronically dysfunctional states.
• Vulnerability to external influences.

The basic problems of political nature in the GLR can be better understood by making reference to realities on ground in Africa. Observably, the nation building process does not go in tandem with building institutions of national unity. Invariably, institutions of national unity are, by and large, lacking. In this respect, we use the term institutions of national unity, to refer to institutions particularly but not only in the public sector, which are unbiased against any individual or social group on the basis of ethno-racial considerations, or on considerations tied to region of origin of the individual or social group concerned. While it is obvious that many African states will not pass a litmus test on the promotion of institutions of social unity, the situation is particularly gloom in a substantial number of the GLR States.The deficiency in institutions of national unity belies the not only the public, but also the private sector. As pointed out by Collier and Gunning (1998), in many African states, even the private sector is fractionalised along ethno-racial parameters.

Thus, considering that stability must have priority over integration, the states of affairs in such GLR states as Burundi and Rwanda in particular and the DRC to a certain extent, underscore the need to invest in the creation of minimum adequate conditions for integration, before they can be useful members of an effective integration scheme.

Mozambique and Tanzania, Tanzania and Zambia, etc.
Overall, these developments cast a shadow of doubt. over the economic and political relevance of the regionalisation schemes. It also does the same for the economic and political identity of the region, even when it is separated into East Africa and Southern Africa. Besides economic and political motives, there is a strong indication that the growing number of integration schemes may be sparked by opportunistic motives. Increasingly, regionalisation schemes seem to resemble"clubs" through which member countries or interest groups therein pursue their vested interests, in particular to attract funds from donor institutions. This leads to a "thin-spreading of resources", leading to wastage and sub-optimal results.

b. Multiple Membership of GLR States in RTAs and other Integration Initiatives

Every GLR State and its potential partners in a broader integration scheme as envisioned in this paper participates in several RTAs and other RIIs. Hence, Burundi is a member of COMESA and the KBO, like its northern neighbour Rwanda. Kenya's connections are even more complicated, being a member of COMESA, EAC and IGAD.

Tanzania is a member of EAC, KBO, and SADC, while Uganda subscribes to the EAC, COMESA, IGAD and the KBO.

VI. Strategic Reflections on a Functional Economic Integration of the GLR States of Central and Eastern Africa

Judging from the overall dynamics in international economic interactions in general, and the NITS in particular, at least four conditions must be fulfilled, in order to build a functio­nal economic integration among the GLR economies. The necessary conditions are, proper targeting of the development co-operation efforts, clarity of the development co-operation agenda, compliance with international obligations, and building institutional capacities.

A. Six Simple Principles to Enhance the Functionality of Integration Schemes

a. Priority of Political Stability over Economic Integration

The essence for stable and functional states in fostering the integration process is best demonstrated by the EU. From its evolution of the EU, we know that although it was partly propelled by the bad experience through the two world wars, integration did not precede political stability. Hence, countries like Greece, Spain and Portugal did only qualify to join the integration process, after they had successfully eliminated domestic political instability and taken effective departure from the culture of military regimes. In fact, to date, political stability is a prime criterion for consideration to access the EU.

b. Proper Targeting of Development Co-operation Efforts

The underlying rationale for states to participate in economic integration efforts is to pro­mote sustainable development, which usually can be attained relatively faster through the pooling of efforts and resources through institutionalised international co-operation.

The first step towards proper targeting of the regional co-operation efforts is the recognition that the needs for development in the GLR states of Central and Eastern Africa go well beyond more than just trade. They also transcend the economic sphere. Thus, development co-operation must address at least two imperative deficits of the GLR states, i.e., economic and political underdevelopment. In this regard, co-operation must foster the creation and/or enhancement of the foundations for economic prosperity and political liberties. The GLR states and the citizens therein deserve betterment in both dimensions.

Invariably, within the contemporary context,particularily considering the amplification of the globalisation process in general, and the pressure from inward globalisation of industry experienced by economies in particular, the overall target of regional co-operation must be to liberate the GLR states and their individual citizens economically, and politically.

 Box 7: Items of the Agenda for Regional  Co-operation

• Economic liberalisation.
• political liberalisation.

In political terms, the efforts must target and instituting and/or enhancing more pluralistic and participatory political systems and governance structures. Hence, a people­centred regional co-operation must open-up for the people, and conveniently blend the
roles of the state actors and non-state actors (NSAs) in the regional co-operation process.

Therefore, viewed from these perspectives, the needed development co-operation efforts indeed constitute a (fourth) Chimurenga for the liberation of Africa in recent times, if we agree the first, the second and third Chimurenga meant respectively, the struggles against (i) slave trade, (ii) colonial intrusion into Africa from the 15 th to the 19th Century, and (iii)
direct colonial rule (leading to nominal political independence of most states from the 1950s to 1990s). Also, though no guns are necessarily (and/or must necessarily be) used in this fourth Chimurenga, the "peaceful" Chimurenga for the control of Africa's economic resources and political leadership, might be claiming more lives (due to destitute poverty, vulnerability to economic shocks, absence of safety nets, vulnerability to violent political processes, etc.) than the armed struggle of the third Chimurenga. For instance, despite the immense wealth of the continent, every year, the number of African children who die of curable malaria goes in tens of millions. Much higher numbers violent political processes.

In this context, the development co-operation efforts should desirably be founded on a constructive dialogue to promote national and international economic democracy, and thereby the economic affluence of the GLR economies and their individual citizens.

c. Clarity of the Agenda for Regional Co-operation

There should be a clear agenda to guide any integration scheme into success. Therefore, a clear articulation of the development co-operation agenda for the regionalisation efforts in the GLR of Central and Eastern Africa is required. Such agenda should take into consideration the realpolitik of our time. Imperatively, any successful agenda should deco­mpose the development requirements into aspects that can at best be dealt with through efforts including dialogue at the national, regional, and global levels respectively. Notably:
(i) Many issues of great concern for the GLR states need a global dialogue. This is true for instance, of issues of social equity and effective economic participation by the citi­zens of the region. Africa is in such a curious situation that it needs empowerment by external forces, to be able to have some measure of control of its economic resources.

(ii) Technically, the articulation of regional projects has been a major problem of regional groupings in Africa. As summarised in Matambalya (2000: 50), a review of the SADC programme of action (SPA) conducted between 1996 and 1997 reveals that, only 22 percent (in number) and 12 percent (in value terms) of all projects declared by the member states as region, really qualified to be classified as such. Any co-operation among the GLR economies should avoid falling in the same traps, which have restricted the success of regional undertakings in Africa.

d. Accommodating Intra-Regional Diversity by Maintaining Multiple Growth Poles and Variable Geometry

As already pointed out, Central, Eastern and Southern Africa currently hosts a large num­ber of regional integration schemes, with overlapping membership profiles. Besides, some of the differences among the countries of this broad region are real. Hence, in order to accommodate the inherent differences and provide time to move towards a long-term goal of broader regional convergence, in the short-term, a broad-based regional integration scheme must accommodate multiple growth poles within the framework of variable geometry. In a broad-based economic integration for Central, Eastern and Southern Africa, hence accommodating the GLR states with their African partners, such regionalisation schemes as EAC, IOC, SACU, SADC, etc., will form the centres of affinity and growth poles.

e. Rationalisation of Integration Schemes

In the long-term, integration schemes must be rationalized and consolidated.

f. Reconciling the Requirements for Integration of the GLR States and Africa

1. Development Requirements of the GLR States

Generally the development efforts of the GLR economies explicitly and implicitly target the,
(i) development of competitive national economies,

(iii)Furthering co-operation within the international fora

(iii)fostering regional intergration

(v)Smooth intergration in the world economy.

They also recognise the essence to be attractive for inward investments, and (in the long-run) diversify their international trade and overall economic relations.

2. Rationale .for the Promotion of Co-operation Among the GLR States

In principle, the regionalisation of GLR economies presents a plausible option for the enhancement of development co-operation, and a carefully designed regionalisation scheme will answer the development requirements of member economies. In this context, the rationale for development co-operation among the GLR states is underscored by such factors as, (i) the geographical proximities of the various GLR economies countries, (ii) their converging development requirements, (iii) the existence of the potential for co­operation in various areas, (iii) the internal experience within integration efforts in Africa, particularly shared by Kenya, Tanzania and Uganda.

Regional co-operation bear the expected fruits in terms of fostering sustainable and self-propelled development, they should be designed in accordance with the realities of contemporary and future development needs of ACP economies.

B. Technical Requirements for Economic Integration Among the GLR States

a. Compliance with International Obligations

If the GLR is to evolve as an economic bloc, it will have to adhere to international regulations, particularly with respect to trade. In this regard, the most pressing demand will be compliance with the provisions of the various international fora, in which the GLR economies participate, particularly the WTO, but also BTAs and RTAs.

Imperatively, regardless of the adopted geography of regionalisation, the formulation of a new trade regime will need to reconcile the diverging objectives, in order to come up with a convention acceptable to all parties to the contract as well as other actors in the international system.

b. Appropriate "Geography of Regionalisation"

One important lesson from the history of economic integration, is that it cannot be driven from outside. Analogously, when contemplating the formation of viable ACP regional groupings, it should be borne in mind that the „geography of regionalisati­on" cannot be driven from outside. Thus, the ACP countries should have a choice of the „geography of regionalisation".

Ideally, the ACP groupings should be as natural as possible, and bear political and practical feasibility. In this regard, they may follow the existing integration, or be built along any other criteria deemed viable by the ACP states themselves. While, the Caribbean and Pacific cases are relatively clear due to, among other thing, the small numbers of states involved, in Africa the situation is complicated by the proliferation of integration schemes and the overlapping memberships.

In an ideal scenario, the integration schemes in Africa should be based on geogra­phically, politically and economically clearly linked countries. However, reality shows that this does by and large not exist. Even such old integration schemes as the SACU reveal weaknesses of limited economic and political linkages, and skewed interdependencies. Overall, the infancy of integration in Africa means that in reality, the window for optional approaches to the "geography of integration" is wide open.

One strategy to counter the dilemma of the proliferation of integration schemes Africa is to adopt a pan-Africanist approach, and form broadly-based (supra) integration schemes that could accommodate "smaller" ones within them. Variable geometry can guarantee the continued co-operation within the smaller schemes. To under­score the viability of this option, we learn, from the evolution of the EU, that the traditional close linkages among the BENELUX states (i.e., Belgium, Netherlands, and Luxembourg) did not contradict their smooth integration in the EU.

c. Appropriate Institutions

The deficits in supranational institutions is one of the biggest challenges in establishing re­gional economic blocs in Africa. The requirements for such institutions become even more pressing, considering the complex nature of most regional blocs in Africa. Hence:
(i) Since all GLR states participate in parallel RTAs (which are in turn tied to other RTAs) and are likely to continue doing so in the foreseeable future, the need to en­hance supra-national institutions at the regional and sub-regional levels is imperative.
(ii) Such institutions should have sufficient mandate, but also observe broader-based participation. Hence, the principles of subsidiarity and decentralised co-operation must be built-in, to ensure broader-based participation in the development co­operation process.

VII. Concrete Options for Linking GLR Economies with their Critical Partners

The criteria and viability for the formation of an EPA, will greatly depend on the motive for the formation of integration schemes. Considering the evolution of regionalisation efforts in Africa, two considerations are likely to play an influential role on the resultant regional alliances and EPAs, i.e., the degree of homogeneity of the region and the pan­Africanism. The conventional consideration of the degree of homogeneity of the region will stress such factors as the degree of common of interests, shared values, geographical proximity, real economic linkages, etc., among the integrating economies. The politically  flavoured considerations for pan-Africanism will stress integration on a broader base.

 A. Regional Integration Modelled on "Degree of Intensity of Regional Homogeneity"

Judged on the degree of regional homogeneity, probably only the East Africa of Kenya, Tanzania, and Uganda, and the Southern African region of South Africa and BLNS states, may present viable bases for regional alliances on the basis of which EPAs can be formed. The IOC presents another group, which though just at beyond its embryonic stage of development, brings together states which have significant commonalties and great potential for a successful integration.

However, it should also clearly be pointed out that even the two most linked sub­regions Eastern and Southern Africa (i.e., the EAC and SACU respectively), qualify in only some aspects of integration.5 Overall, they remain far below international standards of what may be recognised as enhanced regional linkages. Also, they are prone to un-balanced linkages - Kenya dominating in the EAC and South Africa dominating in the SACU.

Nevertheless, judging strictly on economic criteria, it will be plausible for the EU to enter into separate EPA agreements with East Africa (represented by the EAC), Southern Africa (preferably represented by the SADC), and the Small Island States in Indian Ocean (preferably represented by the IOC).

However, even this approach to geographically group the countries of the region, will not automatically produce appropriate groupings with which the EU can enter EPA contracts. Notably, the EAC, IOC, and SADC are prone to overlapping membership of countries with other regionalisation schemes in the region, especially the SACU and COMESA. To complicate matters even further, South Africa has already a separate trade arrangement with the EU.

B. Regional Integration Modelled on ,Pan-African ism "Considerations

a. Why Pan-Africanism is Important

The basic argument for pan-Africanism in this context, would be to put integration sche­mes in Africa on broader regional bases. As pointed out in Matambalya (2001), the basic merits of a pan-Africanist option are:
(a) To overcome the limitations of the market base (due to fragmented African national and even regional markets).
(b) To foster regional solidarity and African unity. In this regard, it conforms with the Abuja Treaty on the formation of the African Economic Community (AEC), and the Lusaka Treaty establishing the African Union (AU).
(c) To improve the domestic resource base (hence provide the critical mass of resources mix) for development in terms of such factors as, markets, capital, etc.
(d) To present relatively strong „integration blocks" in line with the contemporary global developments.

Also, the absence of flying geese to propel integration in Africa render more credence to the argument for a broader based co-operation.

There is also another point to support the pan-Africanist approach. This arises from the fact that despite several experiments, integration in Africa is in reality still so under­developed that, we shall more or less be beginning a new chapter of regional alliances on the continent. Thus, such alliances could be built on a broader base.

b. Concrete Options under Pan-Africanism

Considering the need to accommodate the GLR states in one regional bloc, the pan­Africanist approach offers two plausible bases for regional integration, i.e., a broadly-based integration scheme for Eastern and Southern Africa (designed to accommodate the countries of the EAC, the IOC, and the SACU) in the form of an „extended" SADC, and a broadly-based regionalisation scheme for Eastern and Southern Africa. The two proposals are briefly discussed below.

1."Pan Africanist" option 1: co-operation under the "extended" SADC umbrella

The first consideration under „pan-Africanist" option, could involve an EPA between the EU and a broadly-based integration scheme, but confined to Eastern and Southern Africa as defined in this study. In this regard, an "extended" SADC, accommodating within it all the countries of the EAC, the IOC, and the SACU, together with the remaining SADC members which do not belong to any of these groups could be considered. In such an arran­gement, the EAC, the IOC, and the SACU would form the three growth poles of the region.

This option will have several additional advantages. Besides having a political appeal,technically, it also offers mechanisms to address the complexity associated with the rather amorphous alliances in the region. To take care of the various economic interests, the strategy of variable geometry, which allows some members to integrate faster than others, could then be applied in the relations between the EAC, IOC and SACU.

Also, by adopting this approach, South Africa may be accommodated in the group. In this context, following the logic that, if LLDCs can benefit from SDT within or outside an EPA, it should also be possible to treat a more advanced state like South Africa differently. For instance, variable geometry regarding RSA-EU linkages on the one hand, and the EU and the remaining countries of the group on the other hand may be practised.

Besides, it will consolidate regional solidarity, while at the same time accommodating the diversifying interests of the countries of the region (which can continue to work together through the EAC, the IOC, and the SACU).

2. "Pan Africanist" Option 2: New Co-operation Schemefor Central, Eastern and Southern African States

Indeed, the macro-and micro- economic characteristics of Africa suggest that regionalisa­tion on an even broader basis may provide the answer to some of the more challenging questions to economic development. In this context, broader-based co-operation is associated with advantages in terms market considerations, domestic resource base, and overall long-term political appeal.

Hence, another plausible option will be an even more embracing innovation, in the form of the formation of a new integration scheme for Central, Eastern and Southern African States.6 Analogous to the approach under „extended" SADC, variable geometry may be used to consolidate solidarity within the existing schemes.

C. Summarising Remarks

It is obvious that making the decisions on the „geography of regionalisation" in order to accommodate the GLR states in a functional integration schemes with a future, will be a rather tough task. It will require ingenuity and a lot of strategic thinking. Hence, informed opinion on the merits and demerits of each approach will be necessary inputs of the decision making exercise. In this regard, it will be necessary not to pre judge any of the models, but to seriously consider the merits and demerits of each, as well as their practica­bility in the current setting in the concerned regions and the international system as whole.

As cautioned in Matambalya 2001, weighing integration based on "degree of regional homogeneity" and one based on "pan-Africanist" considerations, a number of reasons speak for the latter model. In particular, the shortfalls of the African economies necessitate co-operation on a broader regional basis.

Given the current reality in Africa and the overall continental trends elsewhere, the prospects for innovating economic integration in Africa should be explored. Thus, in the intermediate phase before the attainment of the African Common Market, the economies of the continent can be allied along the following considerations:

(i) The economies of the continent can be divided into two major regional blocs. One major block will constitute states from Central, Eastern and Southern Africa, and the other ally states from Central, Northern and Western. Notably, according to this appro ach, the States from Central Africa will be categorised into one of the two major blocs, depending on the current affinity of their economic activities. Hence, while the DRC, Burundi and Rwanda will fall in Central, Eastern and Southern and Africa group, the Central African Republic will fall in the Central, Northern and Western Africa group.

(ii) Retaining the existing regionalisation schemes in these broad regions as growth poles and apply variable geometry. Hence, in a broader-based integration scheme of Central, Eastern and South Africa states, groups like the EAC, IOC, SACU and SADC will be maintained. Likewise, such schemes as ECOWAs, UDEAC, etc., will be the growth poles of a broadly defined integration group of Central, Northern and Western Africa states.

(iii) Apply variable geometry within each major regionalisation bloc, in which the individual regionalisation schemes will serve as growth poles.

(iv) Apply variable geometry between the two major regional blocs.

VIII. Conclusions

At the policy trade, at least nominally, the GLR economies are active members of the global trading family. In this regard, they all subscribe to the WTO, which provides the overall framework for international trade. In line with the WTO provisions, the GLR.