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Free trade for Comesa members in offing

The Times of Zambia

Free Trade for Comesa Members in Offing

By Wesley Ng’andu

13 June 2007

President Mwanawasa alongside other Common Market for Eastern and Southern Africa (COMESA) heads of State endorsed Zambia’s commitment to the launch of the COMESA Customs Union (CU) by December 8 next year during the recently-held COMESA summit in Nairobi, Kenya.

Key elements of the Customs Union include free circulation of goods and a complete elimination of barriers to intra-regional trade, including the elimination of rules of origin, a common external tariff, common product nomenclature, common valuation system, a regional trade policy and a Customs Union administrative structure.

The COMESA heads of State also adopted the COMESA Common External Tariff (CET) Structure of a four-band category of raw materials at zero per cent, capital goods zero per cent, intermediate goods at 10 per cent and final goods at 25 per cent, with a provision for flexibility on policy space.

This entails that imports of raw materials and capital goods into the country would be at zero per cent, intermediate goods at 10 per cent while finished goods would be at 25 per cent.

The regional leaders, therefore, directed that all the necessary technical work and implementation modalities on the CET based on the UN classification system and other related areas be finalised before the next summit to ensure that the Customs Union is launched on December 8, next year.

They urged all the six member states that have not yet joined participation in the Free Trade Area (FTA) to do so before the launch of the Customs Union next year. COMESA currently has a total membership of 19 countries.

Speaking before closure of the summit, President Mwanawasa said the summit’s theme ’Deepening Integration for Diversification and Value Addition’ had come at an opportune time when the region was working towards enhancing intra-regional trade and investment.

Mr Mwanawasa said in order to realise the vision, there was need for greater involvement of policy-makers and the business community in crafting innovative ways of attracting investment in the right sectors of the region’s economies.

"As a region, our export trade is concentrated in primary commodities, a situation that places us at a disadvantage in terms of generating the requisite levels of growth necessary to meet the Millennium Development Goals (MDG) of halving the levels of poverty by the target date of 2015.

"Even though the past two years our economies have recorded an average growth rate of five per cent per annum (due to favourable commodity prices on the international market), this falls below the recommended rate of 7 per cent to meet the MDGs as expected," he said.

Meanwhile, President Mwanawasa said that recommendations by the business forum of addressing investment infrastructure, increasing budgetary allocation to health and education sectors, improving agricultural productivity, elimination of non-tariff barriers, improving productive capacities and elevating the role of women in business, were important observations which required member State leaders’ action.


He added that other facets of the integration agenda such as infrastructure development, harmonisation of standards, policies and programmes were critical to the facilitation of regional trade.

President Mwanawasa said the infrastructure window of the COMESA Fund would serve an important source of development finance for the region once fully operational, adding that Zambia rendered her support in making the Fund fully operational.

He further said there were other developments taking place at the multilateral level in the context of the World Trade Organisation and the region’s future trade and economic cooperation with the European Union, which had growth implications for the COMESA region.

"’We should, therefore, not lose sight of these negotiations. Our objective should be to consolidate and advance positions that serve our development interests as a region. Solidarity, therefore, remains critical in this regard," President Mwanawasa said.

According to the COMESA strategic plan, the transition period towards the creation of a Customs Union began in 1994 with the COMESA Treaty under which member states decided to launch the Customs Union within 10 years.

Significant preparatory work has already been done, among which include the Common Tariff Nomenclature, Safeguards and Trade Remedies, a Common Valuation System and Regional Competition Regulations.

It is expected that the COMESA Customs Union will ensure a more predictable economic and trading environment across the COMESA region, as well as to enable COMESA countries to take a common and strengthened response to the challenges of globalisation.

The roadmap under Common External Tariffs contains such specific goals as agreeing on a Common External Tariff structure that minimises conflict with other regional trading arrangements, and implement a programme to have member state tariff rates aligned with CET target rates.

Others include developing budgetary assistance measures to minimise revenue gaps arising from implementation of CET rates, develop measures to assist industries to successfully compete under a CET/CU environment, complete work on the Common Tariff Nomenclature with agreed categorisation of goods and improve Rules of Origin.

Under Customs Procedures and Legislation, the goals include developing programmes to simplify and harmonise customs procedures and legislation and develop antidumping, countervailing duty regulations and other trade remedy measures for the CU.

Goals for Legal and Administrative Structure include developing a legal and administrative framework for CET/CU, constituting the Common Tariff Nomenclature Committee and establishing Customs Union Liaison Officers in member states.

Officially opening the 12th COMESA summit, whose theme was ’Deepening Integration for Diversification and Value Addition’, COMESA outgoing chairperson, Ismail Omar Guelleh, said among factors determining the fast-tracking of the Customs Union by the end of next year, efforts were concentrated on the enlargement of the Free Trade Area (FTA), which was one of the focus areas that required sustained attention.

Mr Guelleh, who is also Djibouti president, said the COMESA Customs Union would consolidate the benefits to be reaped by member states within and without the region as it would considerably improve investment conditions within the region and lead to enhanced influx of Foreign Direct Investment and deeper integration into the world.

He said there was need to endeavour to harmonise the different customs unions in order to create an inclusive and integrated economic space because the move towards the objective of a common Customs Union was involving in tandem with a series of similar developments within the East African Community (EAC) and Southern African Development Community (SADC).

Mr Guelleh said to attain the objective, the current issues relating to multiple membership to regional economic communities must be addressed not from an angle of overlapping memberships but rather from that of the need to harmonise legislations, programmes and activities.

Peace and stability in the region needed to be strengthened, otherwise the objective of the regional leaders to enhance development through investments and intra-regional trade without barriers may not be fully achieved if some member states were involved in conflicts.

As such, Mr Guelleh said the promotion of peace and stability within the region was not only a precondition necessary for the development of trade but also for ensuring an environment for attracting and protecting investments.

He said the situation prevailing today in Somalia and the relative calm observed despite the ongoing attacks against the AMISM forces reminded the region daily that in order to consolidate peace, it was imperative to initiate an inclusive and constructive dialogue.

Incoming COMESA chairperson, Kenyan President, Mwai Kibaki assured the House that his new bureau composed of himself as chairperson, Zimbabwean President, Robert Mugabe, as vice-chairperson and Djibouti President, Mr Guelleh as rappotuer, would remain focused on the shared vision of attaining a fully integrated and internationally competitive economic community in which goods, services, capital and labour would move freely across national borders.

Mr Kibaki said that would enable regional citizens to share the benefits of integration and enjoy high standards of living, as well as increased social and political stability.

He said although along the journey various challenges may be faced, they were encouraged that every challenge they overcame would unleash countless benefits for the people in the region.

King Mswati III of Swaziland also threw his words to the August House of heads of State, saying it was important that COMESA should utilise all available opportunities in relation to the promotion of intra-trade within the region, adding the fact that some countries had limited resources should not deter efforts to develop the region’s economies and societies as part of the integration.

He said the Customs Union would transform economies of member states, thereby making the COMESA region a land of unlimited opportunities for the children and many more generations to come and thus make all the founding members proud.

The King said the region’s collective desire was to create an environment through which the human capital would be nurtured, developed and given hope for a better future.

As the heads of State and Government were having their discussion at the summit, the First Ladies also had their own busy schedule discussing issues in relation to education, health and economic empowerment during a fourth COMESA First Ladies Roundtable meeting, whose theme was similar to the main summit.

During the meeting, Zambian First Lady, Maureen Mwanawasa, was among the speakers and received applauds from the gathering as she tabulated the situation in Zambia. Mrs Mwanawasasaid Zambia had made some positive strides as regards women empowerment in terms of employment.

She said some of the positive strides included the appointment of a female political adviser to the President, a female Deputy Speaker of National Assembly, appointment of some females to the Cabinet and the inclusion of a number of women in the National Assembly.

She added that even under her Maureen Mwanawasa Community Initiative, they had embarked on a project to give goats to some women’s groups in Southern Province who in turn had to give other groups the offspring from the goats they were given as a way of empowering them.

Mrs Mwanawasa said they believed in a practical way of empowering women rather than a cosmetic way where they were given something that was not sustainable and would lead them back on the streets.

On health, she said the Government had introduced free medication to all people in rural areas, free medication to under-five children and the aged over 55 year both in urban and rural areas.

Mrs Mwanawasa added that as for education, there was free education for all lower basic schools while civil societies in the country were busy advocating for free education to even go to higher secondary level, adding that at tertiary level, the Government was providing bursaries.

Opening the roundtable forum, Kenyan First Lady, Lucy Kibaki, appealed to relevant decision-making organs of COMESA to allocate adequate resources and enhance the technical capacity of COMESA organs detailed to implement the COMESA Gender Policy.

Mrs Kibaki said there was need to speed up the implementation of the COMESA gender policy by all member countries.

After deliberating, the First Ladies released a communique in which while commending some progresses in COMESA regarding some women empowerment affairs, they observed a number of obstacles that they requested attention of the authorities that-be.

They paid tribute to Mrs Mwanawasa and her two Rwandan and Ethiopian counterparts, Janet Kagami and Azeb Mesfin, respectively, for being awarded the Legacy of Dream Award for their leadership role in the fight against HIV/AIDS.

In their communique read by Professor Elizabeth Ngugi from the Kenyan First Lady secretariat, the First Ladies said they were happy that the trio had made all the regional First Ladies proud.

Meanwhile, the First Ladies said while they were commending the progress made by COMESA towards economic empowerment of women, there were still a number of obstacles that limited the advancement of women in the region.

They said to promote empowerment of women, a lot more needed to be done in human, financial and material resources, health, education and decision-making processes.

They noted that the region experienced high rates of maternal and infant mortality due to inadequate health facilities, especially in rural areas.

They further said in some countries adult illiteracy for women was more than 50 per cent compared to less than 40 per cent among men in most cases while women participation in decision-making was less than 20 per cent in most countries in the region.

The First Ladies, therefore, called on COMESA member states to ensure adequate human, financial and material resources in planning and implementing homegrown sustainable programmes intended to eliminate gender inequality and inequity.

They reiterated that member states should adopt and implement the African Union Solemn Declaration on Gender Parity regarding the 50 per cent participation of women at all levels of decision-making.

They further reiterated their call on member states to put in place a regional strategy to enhance girl-child education and to ensure the elimination of obstacles of factors that prevented the access of girls to education.

The First Ladies further called on member states to put in place a regional strategy to implement the millennium goal for reducing maternal mortality by three quarters by 2015.

They went ahead, calling for a regional monitoring and evaluation mechanism to ensure the mainstreaming of women and gender in all Integration programmes.

The First Ladies urged all of them in the region to continue playing an advocacy role on the full participation of women in the COMESA Economic Integration Agenda. -ZANIS