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East Africa: COMESA wants Tanzania out of SADC

Mmegi/The Reporter, Botswana

East Africa: COMESA Wants Tanzania Out of SADC

25 August 2006

By Bester Gabotlale, Dar Es Salaam

With government seemingly in no hurry to entertain the business community advocating for the country to re-join the COMESA trade bloc, the group does not want to let go.

And while many, including Tanzania industries, see the lobby as an exercise in futility, given the current government thinking and the general lack of support for a return to COMESA, the pro-COMESA group believe they have a strong case.

But since the stake-holders workshop, which considered the report on the effects of Tanzania’s withdrawal from COMESA on the business developments with COMESA countries in mid July, the group has to date not yet delivered its final report to government.

The workshop resolved that despite fierce opposition, Tanzania should re-join COMESA and pull out of the on-going SADC-EU Economic Partnership Agreements and join the East and Southern African Association, a loose coalition of mainly COMESA member states. The negotiations are due to end in December 2007.

"We haven’t formally submitted the report to government but once we have it, we shall submit our formal position," Hussein Kamote, Director of Policy Research at the Confederation of Tanzania Industries (CTI) told Mmegi this week.

Although he said he was a "little bit worried that government is not ready to go back to COMESA."

"Even when we were doing the study everybody was saying, ’we are not going back to COMESA’ and when we asked why, they said it is because of the membership fees," he said. He however said the membership fee is not an issue since they have volunteered to shoulder that burden on behalf of government.

But government has pointed out to them that, they are the ones who pushed for withdrawal from COMESA.

"That was eight years ago and things have changed. I think we need to return there, we are losing out," Kamote stressed.

However, comments from speakers at the workshop were mixed on the COMESA return.

Former chairman of the Tanzania Private Sector Foundation and now chairman of the East African Business Council, Arnold Kilewo said Tanzania industries are suffering as a result of quitting COMESA.

"Investors who started businesses here downsized operations because the COMESA market is no longer available," he said and argued that trade only grew because of South Africa "but otherwise we face competition from many countries including India, China and others."

"We have to demonstrate to government that the business community needs COMESA," he said but the industries instead "demonstrated" that they do not need COMESA.

Harprect Duggal of Tanga Cement did not mince words when he told the meeting that: "If you are sending a report to government asking it to re-join COMESA then please state that the cement companies do not agree."

"It’s funny because Tanzania is the gateway as a source of transport network," argued Kamote stressing that countries such as Zambia, Malawi, DRC, Rwanda and Burundi, which are COMESA members depend on Tanzania. "We are transporting their goods but we don’t have common rules and Kenya, which is a bit far, is taking advantage.

He argued that regional integration bodies are there for commercial purposes and for a country to choose which one to belong to, it has to be guided by these principles. But in his thinking, Tanzania has done exactly the opposite.

"We have a trade surplus with these countries, so logically that was a trade bloc as far as regional integration is concerned but contrary to that we don’t belong to a bloc where we have a trade surplus," he added. He however confessed that on the balance SADC presents better prospects for Tanzania going forward because it has a development programme as opposed to COMESA, which is purely trade.

"If it was trade only, Tanzania doesn’t have to belong to SADC," he said citing the huge trade deficit between Tanzania and South Africa.

"The principle objective for a country is the extent of its trade surplus or the potential. Tanzania won’t have a trade surplus for at least 10 to 15 years," he argued.

SADC Executive Secretary, Dr Tomaz Salomao who visited Tanzania last month said; "In practical terms I met the whole cabinet in this country," and that included the Prime Minister Edward Lowassa, professors, experts and common citizens.

"The message I get is that Tanzania is committed to SADC," he told journalists at the end of his visit. He also pointed to the many planned and on-going SADC projects that would directly benefit Tanzania and the region, amongst them the anticipated tourism boom with the World Cup in South Africa beckoning in 2010 and other infrastructural projects such as corridors.