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South Africa pushes for new African FTA

Bua News | 23 February 2011

South Africa pushes for new African FTA

South Africa is pushing ahead to secure a free trade agreement between the Southern African Development Community (SADC), the East African Community (EAC) and the Common Market for East African States (Comesa).

Briefing journalists in Cape Town on Tuesday, Trade and Industry Minister Rob Davies said that a summit between the SADC, Comesa and the EAC would be hosted within weeks.

He said a SADC conference, held earlier this month, to prepare for the summit had proved a very "useful and important meeting of minds" on the approach to the free-trade agreement among the three trade blocs.

"The signs are there that we can seriously move forward," Davies said.

The conclusion of the free trade agreement would mean the promotion of a market containing 26 countries, with a combined GDP of US$624-billion and a population of 700-million people.

Africa ’the next frontier’

Davies said there was growing evidence that Africa would be the next economic success story.

He pointed to a report last year by McKinsey, dubbed "Lions on the Move", which cited the minerals boom and growing domestic demand, in particular from the middle-class, as key drivers of growth on the continent.

"When we look at our domestic market as an individual country, we are 49-million people in South Africa," Davies said. "We’re [like] a small town in China, we’re not a sizeable domestic market; but when we start to look at our continent as a whole, or even if we look at sizeable parts of our continent, then we start to crack the numbers."

Council of African Ministers of Industry

He said African countries needed to work together for opportunities on mineral beneficiation projects, adding that this would be a key point of discussion at a meeting of the Council of African Ministers of Industry in Algeria in April.

The council is a newly formed initiative by the Department of Trade and Industry, involving trade and industry ministers from Africa.

Davies said the Brazil Russia India China (Bric) conference, to be held in Beijing on 14 and 15 April, also presented an opportunity for the country, with China’s invitation late last year for South Africa to join the grouping.

The delegates from the member countries are expected to develop targets for trade between Bric countries and areas where co-operation can take place – which would involve some of the spatial development initiatives on the continent, he said.

Turning to global trade agreements under way in Geneva, Switzerland, Davies said there was a "window of opportunity" to draft a more equitable trade agreement, despite developing countries asking for more concessions in terms of industrial tariffs and maintaining farming subsidies.

 source: Bua News