EAC financial crisis deepens as member States continue to default on contributions
By Reuben Mwambingu, June 16, 2025Persistent failure by East African Community (EAC) partner states to honour their financial obligations has plunged the regional bloc into a deep hole of financial crisis.
The cash crunch is threatening the operations of key institutions and the implementation of critical programmes.
The grim financial state of the EAC came to light during a retreat of the National Assembly’s Departmental Committee on Regional Integration, chaired by Nominated MP Irene Mayaka in Mombasa.
The committee met with officials from the State Department for East African Community Affairs to review reports from the East African Legislative Assembly (EALA), covering proceedings of the 4th meeting of the 2nd session of the 5th Assembly held between June and July 2024 in Arusha, Tanzania.
Principal Secretary for EAC Affairs Caroline Karugu explained to the Mayaka-led committee how the delayed remittances by partner states were choking vital operations across the bloc.
The resulting shortfalls, she warned, were suffocating service delivery, delaying staff salaries, and stalling the rollout of vital regional development projects.
“I must address the persistent challenge regarding remittances by partner states, which continues to undermine our operations. We must collectively explore innovative financing mechanisms to ensure the community’s financial sustainability,” Karugu said during the meeting at English Point Marina.
The Committee on General Purpose’s report on the EAC budget implementation for the 2023/2024 financial year indicates that as of June 22, 2024, contributions due from partner states stood at $51.4 million (about Ksh6.7 billion).
Out of the figure, only $39.8 million (Ksh5.1 billion) -77 per cent – had been paid, leaving a balance of $35.7 million (about Ksh4.6 billion), and total arrears at $24.1 million, or Ksh3.1 billion.
While Kenya and a few other countries have consistently met their full contribution obligations, the report indicated that newer member states like the Democratic Republic of the Congo (DRC), which joined in 2022, had yet to appropriate remittances for earlier years.