6/21/2024
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Somalia's Economic Renewal through Integration into the EAC: Lessons from Regional Initiatives
By Hon Sadik Warfa
Monday April 8, 2024

 

Ahmet Davutoglu, a renowned Turkish academic and politician who held the position of the 26th Prime Minister of Turkey and Foreign Minister during the 'Arab Spring' in 2011, emphasized the necessity of undertaking historic reassessments in order to transform the Arab region into one of stability, freedom, prosperity, cultural revival and co-existence. Though the outcomes of the 'Arab Spring' were met with varying degrees of success, particularly in Tunisia, Davutoglu's words remain a poignant reminder of the aspirations for positive change. Today, months after Somalia's accession to the East African Community, I find his sentiments resonating deeply with my own reflections.

Somalia's accession to the East African Community (EAC) is a pivotal moment that will mark its progress towards economic empowerment and regional integration. It offers Somalia a significant opportunity to establish conducive environments and regulatory frameworks that bolster investor confidence and safeguard property rights. Within the context of the EAC, the developmental forces of technology, climate change, and global economic integration become even more pronounced, presenting unique challenges and opportunities for both East Africa and Somalia within the regional framework.

Addressing these challenges and opportunities demands a comprehensive approach. Technological advancements must be capitalized in order to adapt to the evolving workforce landscape and ensure sustained development in the region. Investing in human capital is crucial to enhance workforce productivity and well-being. Initiatives such as the Decent Work Country Program that was signed On June 10, 2023 and the Draft Labour Code for Somalia approved by the Council of Ministers of the Federal Government of Somalia in August 2023, strengthen labour institutions, and address issues like unemployment, vulnerability, poverty, and inequality. Their implementation would not only Promote social dialogue for protection of labour rights in Somalia, but will open up opportunities for a better bargaining ground for Somalia workforce in the EAC regional work ground.

Somalia joining EAC presents opportunities for significant infrastructure development and investment, mirroring Croatia's experiences with EU-funded projects. Just as Croatia which was the last country to join EU a decade ago has benefited from flagship energy projects, Somalia could harness regional cooperation to address its energy needs and enhance its role as a transportation hub. Additionally, strategic infrastructure projects, such as bridges and pipelines, can facilitate connectivity within the region, similar to Croatia's construction of the Pelješac Peninsula bridge. These ventures, although costly, symbolize tangible progress and contribute to regional integration and could enhance Somalia's infrastructure network and foster economic development.

Moreover, Somalia needs to focus on education and skill development to equip its workforce with the necessary competencies for the modern job market. Drawing inspiration from successful models like Kenya's Competency-Based Curriculum (CBC), Somalia can enhance its educational system to meet the demands of the evolving economy. Further embracing digital literacy, investing in STEM education, and enhancing vocational training programs are also essential steps to ensure the workforce remain competitive and adaptable.

While economic trends have undergone transformations—from agrarian to industrial to knowledge -based—the educational framework has lagged behind. The persistence of teaching and learning subjects that hold little relevance in the current and future landscape underscores the urgency for reform. Present-day learners must be equipped with skills geared towards acquiring and organizing knowledge to enhance productivity. Proficiency in acquiring, organizing, and applying knowledge across diverse fields will generate a workforce adaptable to the rapid changes in today's economy.
As Somalia integrates into the EAC, capacity building within government institutions and across the EAC region becomes a factor to focus on, it is now imperative to enhance governance, transparency, and accountability. Prioritizing infrastructure development, fostering partnerships with international organizations, creating an enabling regulatory framework, strengthening internal capabilities and promoting a culture of entrepreneurship and innovation are essential for East Africa's successful integration into the global market.

East Africa has grappled with a persistent disparity between the availability of labour and the demands of the job market for an extended period. Rectifying the resulting challenges necessitates a concerted and extensive effort, compelling us to surpass the conventional measures adopted by other economies in the region. Addressing the supply side of the equation mandates a comprehensive overhaul of our education systems, commencing from the foundational levels. The restructuring should prioritize the cultivation of essential competencies required by the contemporary economy.

Despite East Africa's strong participation in international trade, the current state of the region's export environment points to a lack of substantial job creation and employment. This shows that at its current level of development, East Africa might not be completely prepared for a smooth integration into the global market. A Vital and calculated move would be to take a measured approach, waiting to increase the region's international trade until it is able to export sophisticated technologies instead of just basic commodities.

Moreover, the EAC has the authority and power to establish cross-border collaboration structures that will promote the sharing of knowledge, ideas, and technology among its member nations. This cooperative strategy will encourage the kind of synergy that can greatly boost economic development in addition to regional integration. collaborative efforts in the field of research,technology and innovation will also help the region establish a structured and organized business and employment structure.

Embracing technological advancements is another key aspect of organizational improvement. The EAC can invest in digital infrastructure and promote the adoption of technologies that streamline administrative processes, facilitate communication, and enhance overall efficiency. A digitally connected East Africa can create a conducive environment for businesses, both local and international, to thrive, consequently contributing to the formalization of employment opportunities.

Another factor to consider adoption of a common currency, Similar to Croatia's and all EU members transition to the euro, this transition has been described by the Former Prime Minister of the United Kingdom Tony Blair as an economic move that would lead to developments and had brought about economic stability and facilitated trade within the EU, something that could happen in the EAC. However, the move towards a single currency would require adherence to economic and legal criteria, encouraging members of the East Africa Community to implement necessary structural reforms to meet the requirements for currency integration.

Another agreement that would be great for the EAC to Emulate would definitely be recent agreements between The European Union (EU) and the Economic Community of West African States (ECOWAS). The two signed seven financing agreements worth €212.5 million to stabilise the region and drive ECOWAS development. Some of the signed agreements include; Africa trade competitiveness and market access (€50 million); regional clean cooking action in West Africa (€12million) and trade in services in sub-Saharan Africa (€11.5million, these agreements will now place ECOWAS at a great advantage Economically.

Two of the EU’s greatest achievements are the common single market and the adoption of the common euro currency, the free movement of people and goods through the Schengen Zone and reduced the exchange rate risk in trade transactions. If implemented well by embracing innovation, investing in human capital, and fostering collaboration, East Africa can realize its full potential. With concerted efforts and strategic initiatives, the region can achieve sustainable development and ensure the well-being of its people in the face of a rapidly evolving global landscape.

The writer, Sadik Warfa, is a former Minister of Labour of the Federal Republic of Somalia and Represented Mudug Constituency Federal Parliament 2016-2022.


 





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