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Implementation challenges will haunt Grand FTA

Southern Times, Namibia

Implementation challenges will haunt Grand FTA

By Southern Times Writer

7 March 2011

Windhoek - Implementation challenges and barriers to trade liberalization currently dogging SADC’s Free Trade Area (FTA) will continue to haunt member states in the implementation of an ambitious grand FTA encompassing COMESA, EAC and SADC.

The Common Market for Southern Africa (COMESA), East Africa Community (EAC) and SADC are coalescing in a grand FTA, an ambitious plan which involves liberalizing about 85 percent of trade among the 26 members of the three regional blocs.

The grand FTA hopes to liberalise trade from Africa’s southernmost tip, Cape up to Cairo in Egypt.

SADC Executive Secretary Dr. Tomaz Salomao told journalists on the sidelines of the Council of Ministers meeting in Windhoek that a tripartite council of ministers and Summit would be held in South Africa during the second quarter of 2011 to lay the corner stone for the ambitious trade liberalization agenda.

The three blocs are preparing for the tripartite summit and a ministerial taskforce was recently briefed on progress made so far towards establishing the grand FTA, Salomao said.

Admitting that intra-regional trade remains low despite the launch of the SADC FTA in 2008, Salomao said that bringing together 26 countries with overlapping membership in the three blocs is what Africa needs to boost trade and economic growth.

’The biggest achievement of the European Union (EU) was being able to trade amongst themselves. If you go to Asia, their biggest achievement was the amount of trade they generate amongst themselves. We need to move from 10 percent trade amongst ourselves to 45 percent and more. Let us boost trade amongst ourselves,’ Salomao said.

SADC’s FTA has seemingly been dogged by implementation challenges. Angola, DRC and Seychelles are still to join the trade liberalization programme. Furthermore, SADC’s Customs Union and single currency plans have so far remained mere pipedreams.

Infrastructural challenges, border congestions and delays, lack of a harmonized customs union structure have weighed down the region’s progress towards trade liberalization, Salomao admitted.

SADC claims that it has achieved 85 percent trade liberalization.

’We haven’t seen yet the increase in actual trade and there are still problems of infrastructure-more work still needs to be done to streamline customs procedures, right now its very difficult to get goods across borders,’ Dr. Malan Lindeqeu, permanent secretary in the ministry of trade and industry said.

Salomao maintained that challenges would be tackled and overcome adding that the grand FTA will try to come up with a workable formula. ’Let us take the best practice and share amongst ourselves. Lets bring everyone on board and address those issues that have affected us in the past.

’The major challenge is the quality of infrastructure, we need to mobilize resources and put in place the right infrastructure,’ Salomao said.

Though surmountable, Lindeqeu admitted that the grand FTA has huge challenges and urged member countries to take the initiate to put in place laws and policies to facilitate trade.

’As countries we need to get our own laws in place but you get to a point where that needs to be extended across the border.

Ultimately you need a common approach in the region. The same standards a truck has to meet across borders, same fees structures, there is still a lot more to be done.

’We need to create common interests, supranational laws which then sets the same standards for all of us and serve as the benchmark for bringing everybody up to the same level,’ Lindeqeu said.