The Prospect of Monetary and Financial Co-operation: a Legal Evaluation of Kenya’s Regional Economic Integration Endeavour in the East African Community

Abstract

The thesis interrogates the legal elements and impediments to regional economic integration in the Kenyan-EAC setting. An examination of regional economic integration has to take into account legal factors. The problem that is addressed is that there is no direct legal framework covering mobile money transactions in Kenya. Regulation is left to distinct telecommunications and financial legislations. It is for this reason that harmonization is necessary which will enhance monetary and financial cooperation in the EAC. The study relied on desktop research by analyzing the treaty establishing the EAC, text books, journal articles and reports from the internet focusing on economic integration, harmonization of commercial legislation and dispute resolution. The research found out that the Treaty establishing the EAC is the grund norm. A scrutiny of the phases of integration shows that there are deeper relationship dynamics between the EAC participant states and the citizens of the member states. The EAC treaty is also discussed in regard to it’s place vis a vis the Kenyan constitution in as pertains to hierarchy of laws. The Covid-19 pandemic has also affected Regional Economic integration and the study posits that a collaborative approach is crucial in the integration endeavor. In evaluating the legal challenges for Kenya, the study delves into an analysis of labour as a factor of production, the informal sector and dispute resolution. The study also looks at arbitration and addresses the inconsistency from the Kenyan courts in regard to interference in arbitration matters. This affects monetary and financial cooperation in the Kenyan-EAC context since a good dispute resolution mechanism attracts investments from the international community. The study also looks to the European Union for lessons. Kenya was colonized by the British and one implication of this is that this colonial experience had an impact on Kenya’s legal structure. Further, the European Union has had a long time to grow whereas the EAC is at the stage of infancy compared to the European Union. The study also looks at the Kenya- United Kingdom Economic Partnership Agreement (EPA) of 2020 and establishes that there are a variety of interests that need to be balanced. The prospects for Kenya’s endeavor in regard to monetary and financial cooperation in the EAC is thus fraught with legal challenges which ought to be addressed. The study is thus useful in the Kenyan-EAC context especially since 2024 is the set year when the monetary union should come into fruition. The study is thus nascent as it will offer legal insights in regard to regional economic integration in the EAC.