EAC regional trade maintained steady growth and is projected to continue on the same trajectory driven by accelerated trade, economic integration and global transformation (EAC Trade and Investment Report, 2023). Trade in services outperformed trade in merchandise goods driven by the recovery of tourism and travel-related services.

While EAC exports are still primarily agriculturally based low-technology commodities, the share of manufactured goods in total exports especially to regional markets has been increasing gradually supporting the regions post pandemic recovery. In 2023, total global merchandise trade by the EAC grew by 2.37 percent, valued at more than US$ 80 billion. Intra-EAC total trade similarly grew by 13.1 percent to US $12.1 billion in 2023, with the percentage share of intra-EAC trade to EAC total trade increasing to 15 percent. The European Union and Asia were the major destinations for agricultural and primary products exports, with regional markets key destinations for manufactures. Key manufactured exports included textiles, chemicals, edible oil, cement, iron and steel, cosmetics and pharmaceuticals.

Relatively, global Foreign Direct Investment (FDI) maintained a slowdown during 2023, occasioned by global financial volatilities and geopolitical tensions, with Africa and the developing economies being hardest hit. However, the EAC region registered growth in both domestic and foreign investment, with most investment directed to communications, ICT services and software and consumer products, biotechnology. With the increase in FDI across most of the Partner States, there has been an increase in the number of jobs created through the EAC FDI.

According to AfDB, the Eastern Africa Region is expected to maintain its position as Africa’s fastest growing region, with real GDP growth rising from an estimated 1.5 percent in 2023 to 4.9 percent in 2024 and 5.7 percent in 2025. For the region’s economies the forecast growth acceleration in 2024 will be bolstered strong government spending and strategic investments to improve in-country connectivity and facilitate trade with neighboring nations, coupled with ongoing efforts to modernize agricultural production and boost productivity in the services sector. However, an increasingly complex interplay between economic, climate and geopolitical risks could affect the economic performance and recovery of the EAC.

For further details, the Report can be accessed:

https://www.eac.int/documents/category/trade-investment-reports