Abstract: Foreign Direct Investment is an integral part of an open and effective international economic system and a major catalyst to development. Yet, benefits of FDI do not accrue automatically and evenly across countries, sectors, and local communities even within regional economic integration context. It is not different in the EAC region since its establishment in 1999. The re-establishment of the East African Community (EAC) created a larger regional market; therefore firms can be located in any EAC country to service this market.