East Africa: Comesa’s transformation into customs union to benefit exporters
The Herald (Harare)
July 21, 2006
East Africa: Comesa’s Transformation Into Customs Union To Benefit Exporters
THE transformation of the Common Market for Eastern and Southern Africa (Comesa) Free Trade Area (FTA) into a Customs Union in the next two years will open up bigger markets for exporters, an industrialist has said.
Mr David Govere told New Ziana yesterday that the union would rejuvenate the export sector and bring about competitiveness in the pricing regime.
"The union will create what are called ’centres of excellence’ as countries will tend to concentrate on what they are good at," he said.
The CU, to be established in 2008, will be characterised by deeper integration and merger of customs territories into a single customs territory.
Mr Govere said non-exporting industries that enjoyed some protection from the Government would be casualties as the local market would be flooded with imported goods, which at times tended to be cheaper.
He called on the business community to seize the opportunity to increase production capacity as the liberalisation would expose the country to global competition, highlighting the need to remain viable in the export market.
Industry and International Trade Deputy Minister Mr Phineas Chihota said the ministry was ready to partner with the private sector and develop a collective approach to export market development in readiness for the union.
He said a number of trade missions to various countries were lined up leading to the launch of the National Export Strategy aimed at growing value added exports.
Zimbabwe’s share of intra-Comesa exports has declined while imports from the region have risen sharply.
Prior to 2000, the country enjoyed a positive balance of trade with the trade bloc. The import bill however shot to US$642 million last year, while exports declined from US$272 million to US$193 million, representing a negative balance of trade of US$449 million.
The 20-member Comesa was formed in 1994 to promote regional economic integration through trade and investment.
It replaced the Preferential Trade Area which had been in existence since 1981. The region has a population of 374 million and an import bill of about US$32 billion.
