This study set out to understand the political, economic, and institutional impediments hindering the achievement of the East African Community (EAC) monetary unification objectives. This comes after the Regional Economic Community (REC) failed to meet its 2024 target for launching a unified currency through its East African Monetary Union (EAMU). This study identified the central tension in the disconnect between the political and economic reality of the EAC, and EAMU monetary unification objectives that view the region as an optimal currency area. The gap separating the EAC’s unification ambitions and its present reality results from economic homogeneity between EAC member states, which limits economic complementarities that would facilitate larger intra-EAC trade volumes. These economic inadequacies result from institutional limitations within EAC member states themselves, which constrain the consolidation of strong industrial and socio-economic structures that would support integrated regional economies. Furthermore, such inadequacies at the national level translate to structural weaknesses at the regional level. These feature collective action problems associated with information asymmetries, agency loss, and overall and lack of political congruence towards economic and monetary convergence. From the findings, this study proposes the following policy recommendations:
1. Harmonizing immigration laws and create programs to address skill mismatches, enabling seamless movement of workers across borders.
2. Establishing cooperative budgets for regional infrastructure projects and create a stabilization fund to mitigate the impact of asymmetric shocks.
3. Strengthening the EAC’s institutional capacity including reinforcing the EAC Secretariat’s monitoring and evaluation systems and addressing information gaps that hinder the development of effective economic policies.
4. Harmonizing industrial policies across member states which can be achieved by setting up macroeconomic convergence benchmarks that align national planning and decision-making with the region’s goals.
5. Enhancing visibility and engagement with the regions citizens to build public ownership of EAC integration.
6. Facilitating an open and transparent platform for global actors to engage with the region’s economy, focusing on sustainable development and trade and ensure that development cooperation interventions are cleared by EAC commission.
7. Developing youth-centric policies to advance and propel EAC integration and budgeting and implementing youth exchange programs within the EAC and beyond.
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