Kenya’s budgetary contributions to the East African Community will rise 67 percent from the current $7 million to $11.6 million in the next financial year, under a newly adopted funding formula recommended by presidents at the last summit in Arusha.

Tanzania, the region’s second-largest economy, is expected to pay $8.2 million, while Uganda and Rwanda will part contribute $7.3 million apiece.

The new formula is based on the partner states’ GDP per capita, as opposed to the current equitable share, which has been criticised as unfair to smaller regional economies, and blamed for the massive default on commitments, which has left the bloc in financial straits.

In the new model Kenya will contribute the highest amount for the financial year 2026/27. The blocs smaller economies and serial defaulters Democratic Republic of Congo, Somalia, South Sudan and Burundi have seen their statutory contributions reduced.

DRC will now be required to pay $5.9 million, Somalia $5.8 million, South Sudan $5.2 million and Burundi $4.5 million.

The formula, which will come into effect on July 1, 2026, was approved by the Heads of State Summit in March 2025, and allows partner states to contribute 50 percent equally and the balance based on assessed economic capacity.

Kenya’s President William Ruto, the former chairman of the summit under whose tenure the model was developed, said it would make financial obligations fairer and more sustainable for member states.“We agreed to make contributions to the community fair and equitable by revising the formula so that 50 percent is shared equally and 50 percent assessed according to economic capacity,” he said at the last meeting.

He added that the new arrangement would enable the community to operate more effectively while ensuring that countries with larger economies contribute proportionately more to the bloc’s budget.

Under the incoming system, which was adopted to resolve the perpetual lack of funds, each partner state will contribute $3.5 million as 50 percent of the Equal Contribution while the other 50 percent will be calculated based on average assessed contribution per partner country.

In line with the summit’s decisions, partner states assessed contributions will be computed based on average GDP per capita of each nation for the last five years-based on the data from the World Bank database.

The funding formula was adopted by ministers responsible for finance during the 17th meeting of the Sectoral council on Finance and Economic Affairs (SCFEA) in May and adopted by the Council last week.

The 60th Extra Ordinary Meeting of the EAC Council of Ministers held in Arusha from May 18-22 endorsed the new figures.

The ministerial session was chaired by Edith Mwanje, Permanent Secretary and Interim Minister of the Uganda Ministry of EAC Affairs, who stepped in for Rebecca Kadaga, before President Yoweri Museveni, who is the current chairman of the EAC appointed his Cabinet.“The council has been convened to consider the budget estimates for onward submission to the East African Legislative Assembly. I wish to emphasise that the presentation of the budget to Eala constitutes a critical responsibility of the Council,” said Ms Mwanje during the minister’s session held last week in Arusha.“I call for the timely consideration to facilitate the implementation of the summit directives and achievement of the expectations of the heads of states.”

Overall, partner states will contribute $56 million based on 50 percent -- $3.5 million shared equally among the partner states -- and another $56 million based on the assessed average GDP, bringing the total of next year’s EAC Budget to $112 million.

Partner states, however, owe $79.9 million in arrears, with DRC being the leading defaulter with $29 million, followed by South Sudan ($21 million) Burundi ($18.9 million), and Somalia ($10 million) as at May 2026.

Kenya and Tanzania have fully paid their $7 million each for the financial year 2025/26 while Uganda has arrears of $52,580, and Rwanda $877,819.

Kinshasa, in its defence, says its financial resources are being channelled towards security challenges in the restive eastern part, and efforts are being made to fulfil their commitment in this year’s budget.

The DRC was represented by Jean Pierre Massala, Ambassador and Permanent Representative to the EAC at the Council meeting.

Somalia committed to disburse 50 percent of its share of the current financial year before July.

A total of $36.7 million, representing 50 percent of the total arrears, is going to be waived, on condition that the other 50 percent is settled within two years, the Council said.

But the waiver does not apply to arrears accumulated within the current financial year.

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