African FTA one step nearer fruition


13 June 2011

After many years of planning and coordinating, African leaders have moved a decisive step closer to establishing the long-conceived goal of a united African economic community.

The leaders, meeting in Johannesburg over the weekend have agreed to formally launch negotiations to establish a grand free trade area that would encompass 26 countries in three regional economic communities, namely the Common Market for East and Southern Africa (Comesa), the East African Community (EAC) and the Southern African Development Community (SADC).

The first phase of negotiations on allowing the free movement of goods is expected to take three years. Future negotiations will tackle trade in services and other issues.

Combined market of 700-million people

The creation of the single free trade area (FTA) would see the coming together of a combined population of approximately 700-million people and a combined gross domestic product (GDP) of US$875-billion.

It would open borders between countries in approximately half of the continent, spanning the entire southern and eastern regions of Africa.

In their communique at the end of their summit held in Sandton on Sunday, the leaders signed an agreement to launch talks and adopted a roadmap for the establishment of the FTA.

They also adopted the FTA negotiating principles, processes and institutional framework, and directed that a programme of work and roadmap be developed on industrialisation.

“The establishment of a FTA will bolster intra-regional trade by creating a wider market, increase investment flows, enhance competitiveness and develop cross-regional infrastructure,” said the communique, read by Richard Sezibera, secretary-general of the EAC.

‘No country can prosper on its own’

South African President Jacob Zuma, in his address to the summit, said the zone would help neighbours work together to alleviate poverty and build industrial capacity.

“There is no single country that can prosper on its own,” Zuma said.

The leaders also adopted a developmental approach to the integration process, saying it would be anchored on three pillars, namely: market integration; infrastructure development to enhance connectivity and reduce costs of doing business; and industrial development to address productive capacity constraints.

During the one-day summit, the delegates from 26 member countries of the three blocs discussed how to enhance cooperation and coordination and improve infrastructure to facilitate trade.

The summit reviewed the progress made in the implementation of the decisions of the first such summit, held in Kampala, Uganda in October 2008, regarding programmes in trade, customs and economic integration; free movement of business persons; and infrastructure development amongst the three regional economic communities.

In the area of infrastructure development, the leaders noted the progress made in the implementation of the infrastructure programmes; and commended the international cooperating partners and the donor community for the support that was pledged for the North-South Corridor at a conference held in Lusaka, Zambia in 2009.

Source: BuaNews