The 9 year EAC Financial Sector Development & Regionalization Project, funded by the World Bank is a welcome development. A strong regional financial sector is needed to underpin an effective common market and build a single financial services market for the region. The development of a regional financial services sector, will also benefit the establishment of a monetary union and single currency. In addition, the EAC region stands to gain by trading on a regional stock exchange, i.e a single East African Stock Exchange and furthermore, the harmonization of the financial services sector will play a key role in unlocking the removal of barriers for the free movement of capital across the EAC region- as provided for by the Common Market Protocol.
In related news, the EAC region has apparently not implemented the Treaty on Avoidance of Double Taxation. The Double Taxation Treaty would allow income generated in any of the five member states to be taxed only once but lack of implementation has given national revenue bodies the legitimacy to maintain the status quo with revenue authorities making double claims for revenue earned in each individual country.
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