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Development of Strategic Regional Industries

Posted in Industrialization & SME Development

The EAC Industrialisation Policy identifies six (6) priority sectors in which the EAC region has comparative advantage.

Strategic interventions have, therefore, been proposed to support competitive development of the priority sectors, which include:

  1. agro-processing;
  2. fertilisers and agro-chemicals;
  3. iron-ore and other mineral processing;
  4. pharmaceuticals;
  5. petro-chemicals and gas processing; and
  6. energy and bio-fuels.

The selection of the sectors was based on the priorities identified at national levels which was complemented by a selection methodology that combines assessed attractiveness of the industry (growth and market share) and industry strategic feasibility (factor endowments) into a single indicator.

To attract investment into the priority sectors and generate new industrial capacities, a regional enterprise promotion and award scheme will be set up, and interested investors will register so as to take advantage of the scheme.

Industries operating under the scheme will be classified as strategic regional industries / enterprises and will be required to meet at least four (4) of the following policy objectives:

  1. fostering of complementarities or enhancing collaborative production in the region,
  2. large investments which may require pooling of resources to ensure that economies of scale are achieved,
  3. contributing to realisation of backward and forward linkages in the value chains with regional dimensions,
  4. contributing to employment generation in the region; and
  5. having presence in at least more than one Partner State and contributing to backward and forward linkages in the region.

A centre for the development of strategic regional industries / enterprises will be established to administer the scheme and promote targeted investments in the priority sectors.

Expected Sector Outcomes

Posted in Industrialization & SME Development

The following are expected to be realised as outcomes of the EAC industrialisation process in the EAC region:

 

Broad, Expected Long-term Outcomes / Impact

Progressively contribute to an increase in:

  1. The manufacturing industry’s contribution to the regional GDP, currently at an average of 9.7%, to an average of 25% in 2032. This growth will have multiplier effects on the agricultural and services sectors;
  2. Manufacturing-based employment currently at 456,000 to about 2.3 million in 2032;
  3. Regional GDP, currently at US$ 110.3 billion to about US$ 238.9 billion in 2032 (based on a projected annual GDP growth rate of 6%);
  4. GDP per capita currently at US$ 769 to US$ 1,300 in 2032 (based on a population growth rate of 2.8% annually);
  5. Manufactured value added per capita, currently at US$ 50 to US$ 258 in 2032; and
  6. The average score on the World Economic Forum Competitiveness Index currently at 3.4 to 4.5 in 2032.

 

Broad, Expected Immediate Outcomes / Impact

  1. Streamlined and coherent policy framework to support deepening of regional production systems and business linkages;
  2. Harmonised policies, strategies and business climate regarding Small and Medium-sized Enterprise (SME) activities in the region;
  3. Strengthened institutional and policy management capacities of the major stakeholders;
  4. Reinforced capacities of the technical support institutions, business advice and consultancy centres;
  5. Establishment of new financial mechanisms and products for SME development and upgrading;
  6. Annual increase in employment by 10% in the manufacturing sector and new employment opportunities created indirectly in agricultural sector and services;
  7. Growth of industrial production at a minimum of 10-20% per year;
  8. Improved productivity, flexibility, strengthened managerial capacities and marketing skills, and the production costs mastered and cut down;
  9. Increased value added by 10-15% per year; and
  10. Enhanced exports capacities and imports substitution and stronger linkages across the priority value chains.
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East African Community
EAC Close
Afrika Mashariki Road
P.O. Box 1096
Arusha
United Republic of Tanzania

Tel: +255 (0)27 216 2100
Fax: +255 (0)27 216 2190
Email: eac@eachq.org

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