COMESA makes new effort to increase intra-regional trade in agriculture
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NAIROBI -- A new initiative has been started to enable farmers and agriculture traders to do more business amongst themselves in eastern and southern Africa instead of only seeking markets out of the continent.
The Common Market for Eastern and Southern Africa (COMESA) Business Council (CBC), a private sector association comprising investors involved in exporting and importing across the 19-member bloc that is spearheading the initiative said intra-regional trade in agriculture will not only create more jobs but also assist in efforts to add value to agriculture commodities across the region.
"The idea is to link suppliers of agriculture produce along the eastern and southern transport corridor in Africa. We want to create economies of scale among the suppliers and link them with the buyers," said Sandra Uwera, the CBC Chief Executive.
She spoke in Nairobi, Kenya on Wednesday during a consultative meeting with farmers and agriculture produce suppliers from the region, to seek solutions on how they can network better to enable more intra-trading.
Nearly all the member countries depend largely on agriculture as the backbone of their economies.
But the challenge is that all of them export much of their agriculture produce in its primary form, denying them an opportunity to industrialize using their produce as the raw materials and also denying them an opportunity to create more jobs through the value addition chain.
"We need to stop this," said Uwera. "Potential exists to develop high-value agriculture produce from growing to value addition through manufacturing."
Kenya, for instance, is one of the world's top producers of black tea but it exports 95 percent of its tea in primary format, which CBC officials said denies the country lots of additional economic benefits from the crop.
The all women-led CBC commissioned a study on the challenges facing agriculture suppliers in the region and initial findings show that suppliers say there is lack of market information that would enable them to reach out to buyers across the borders.
This lack of information sharing means that traders replicate agriculture produce and which is often of low quality.
The chairperson of the Kenya Association of Manufacturers (KAM) who also sits on the CBC board called for deliberate efforts to add value to agriculture commodities within COMESA as this is the only way to ensure that the region benefits from its largest resource.
Statistics from COMESA indicate that intra-regional trade rose from 3 billion U.S. dollars to 20.9 billion dollars since the establishment of a Free Trade Area in 2000.
This, however, excludes the informal trade across the borders that currently goes largely unrecorded but which has been estimated at over 30 percent of formal trade.