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AfricaMoney | August 18, 2017

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Is Africa ready to pull down trade barriers?

Is Africa ready to pull down trade barriers?

To do away with the needless acronyms and multiple platforms, after the tripartite initiative was officially launched in 2011, the AU summit decided to fast-track a continental Free Trade Area (FTA). (Image: Reuters)

When African Union (AU) heads of state gathered in Addis Ababa this month for an extraordinary summit, the topic that was uppermost in all their minds was how to fast track creation of a free trade area for “borderless trading” among African nations.

And, that thread of thought was taken up by AU chairwoman Nkosazana Dlamini Zuma as she noted this week that the continent would do vastly better if there were fewer and larger Regional Economic Communities (RECs). Some RECs even have overlapping membership, just to make things more confusing. According to the AU, the East African Community (EAC) shares four member states with the Common Market for Eastern and Southern Africa (COMESA) and one with Southern African Development Community (SADC).

So, to do away with the needless acronyms and multiple platforms, after the tripartite initiative was officially launched in 2011, the AU summit decided to fast-track a continental Free Trade Area (FTA). The FTA aims to bring the 54 countries into a single market for goods and services with free movement of business people and investments.

However, even setting aside glaring infrastructure issues, there are many obstacles to the creation of a free trade area. Policies and regulations must be streamlined, border officials must say no to corruption and a nation with a conflict-strewn past must rise above its differences for its peoples to make peace with their neighbours across Africa.

In this context, the new edition of “Assessing Regional Integration in Africa” – jointly published by the African Development Bank, the UN Economic Commission for Africa and the AU – has many useful insights to offer.

The publication themed “Harmonizing Policies to Transform the Trading Environment,” stresses the need to remove trade barriers and harmonize policies to promote regional integration.

The report, already in its sixth edition, reiterated the January 2012 Decision and Declaration of the African Union Assembly of Heads of State and Government on boosting intra-African trade and fast-tracking the establishment of a Continental Free trade Area by 2017.

The authors note that while countries have achieved some milestones on the path towards integration, such as the formation of the Tripartite Framework among the members of the Common Market for Eastern and Southern Africa, the East African Community and the Southern African Development Community, “the road to completely dismantling barriers to trade is strewn with obstacles and requires a thorough understanding of regional integration and trade policies.”

“Harmonized rules of origin and trade facilitation environment across the continent would greatly improve the means and cost of doing business across borders,” according to the Foreword of the publication jointly signed by the heads of ECA, AUC and AfDB – Carlos Lopes, Nkosazana Dlaimin-Zuma and Donald Kaberuka.

Source: African Union, African Development Bank (AfDB)

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