Uganda, Burundi, Rwanda, Tanzania and Kenya all harbour the desires for economic and political federation of a kind.
The synchronisation of public budget readings is just the latest in a line of substantive if hesitant steps towards its realisation.
With shared history, culture and languages, these countries can add skyrocketing debt to their common characteristics.
The question of debt is not a moral one. A prudent nation borrows what it can reasonably repay given the strength of its economy.
Much has been said about the virtue of excessive borrowing for nation states. To wit, Japan’s debt-to-GDP of 200 per cent suggests that East Africa’s percentage debt-to-GDP ratio is in fact deficient.
In truth, Japanese lenders expect to be fully repaid over many decades to come. East African nations cannot count on the same as much of their debt is due well within the next 30 years.
Let’s take the analogy of the seven friends who decided to eat out for lunch. Everyone ate beyond their means so that everyone was back to by peel potatoes.
How much did each eat? How far beyond their means have they been living? How much harder will they need to work to reduce their debt? And what are the real market implications of holding so much debt?
With external debt totalling $75.23 billion, each citizen of East Africa and Ethiopia owes $1,435 to foreign lenders.
With a GDP of $246.095 billion, the region’s aggregate economic activity is surpassed only by Nigeria and South Africa.