Plans to initiate a $20 million private sector fund to finance specific integration-related activities are simply the latest in a long series of collaborative ventures between public institutions and private firms.

Each of the East African partner states long discovered the value of such partnerships, nurturing them with varying degrees of success. The specific form that the partnership takes has differed from one sector to another and between countries.

In education, for instance, private institutions have existed alongside public ones, relieving the pressure on public educational institutions. Private companies have also participated in offering scholarships, sponsoring professorial chairs, providing internships for university students, and other collaborative ventures.

In infrastructure, too, partnerships with private companies have led to construction of facilities that would otherwise have been unaffordable using public resources. Generally, some method is agreed upon for the private sector to recover its funds and make a reasonable return, say through the Build, Operate and Transfer model in which the private company would operate a new facility for an agreed period of time.

At the regional level, the East African Community has benefitted immensely from co-operation with the business community led by their apex organization, the East African Business Council. Indeed, most regional integration initiatives are geared toward improving the business environment, hence the significant involvement of the private sector.

It is upon this foundation of goodwill and existing public-private initiatives that the EAC hopes to build a stronger partnership with the private sector. While the details are not yet public knowledge, it is certain that the region’s private sector heavyweights will be expected to make a contribution toward new and ongoing initiatives.

These, according to EABC chairman Felix Mosha, will include harmonization of standards and elimination of non-tariff barriers. Private-sector funding makes sense when one considers that businesses will be the principal beneficiaries of these regional initiatives.

But the devil, as they say, is in the detail. Will private firms cough $20 million out of philanthropy? It will be interesting to find out what concessions these companies are seeking in ongoing negotiations with the Community. Hopefully, the deliberations will not be shrouded in too much secrecy – the kind of opaqueness that continues to characterize our institutions at the national level.

Again, our institutions aren’t too well known for prudent spending. The audit queries raised by the Public Accounts Committee of the East African Legislative Assembly regarding financial impropriety at the East African Community Organs and Institutions do not create much confidence that the malfeasance at the national level hasn’t found its way to the regional level. That is something the private sector hopes to tackle by separating the new fund from the main budget of the EAC Secretariat; we can only hope it works.

But the private sector can only do so much in terms of assisting in what should be the budget of the Community. The core work remains to be done by the partner states. We know, for a start, that a huge chunk of the budget for regional initiatives is covered by donors, and that does not augur well for the future of the Community.

But of even greater importance are political considerations that impinge on the activities of the Community. It is naïve to imagine that funding alone can help get rid of non-tariff barriers, for example. These are measures that are carefully crafted to take care of national interests, and private firms are often the beneficiaries of protective barriers put in place by their own governments.

The lack of agreement and foot-dragging on other core policy issues has little to do with funding. Whether to allow other East African nationals to own land in a partner state, to cross freely in and out, or to be subjected to the same conditions in every situation as its own citizens, has everything to do with national policy and political goodwill rather than funding.

It will be interesting, therefore, to observe the areas in which the fund will be successful. More likely, these will be in the non-controversial aspects of integration, mainly infrastructure projects. The funding may however give the private sector additional leverage to lobby louder in those areas where politicians won’t let go, and perhaps win a few concessions there as well.

Source: All Africa

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