Economic goals will deepen Kenyan-Tanzanian divide

Subject

Outlook for Kenyan-Tanzanian relations.

Significance

The Kenyan and Tanzanian governments in early September continued disagreements over a trade agreement with the EU. The deteriorating relationship comes at a time when the stability of the East African Community (EAC) is already strained by other crises.

Impacts

• Attempts to forge bilateral agreements within the bloc or with non-EAC states could cast doubt on the EAC's future.
• Uncertainty over the long-term future of the EAC will worry investors and could reduce investment.
• Tensions lower the probability of instating a common currency in East Africa by 2024.
• Domestic political pressures could push Kenyan and Tanzanian leaders to demonise each other as a distraction.