Addis Ababa-The East African Community (EAC) and the Common Market for Eastern and Southern Africa (COMESA), have been hailed for improving trade among African countries.
This was said during the opening of the inaugural Africa Trade Forum, Tuesday, in Addis Ababa, Ethiopia, which brought together high level delegates from various African countries, including Rwanda.
During the three-day summit held under the theme ‘Accelerating Intra-African Trade and Enhancing Africa’s Participation in Global Trade’, it was observed that while African countries need to increase their global trade engagements, there was need for African countries to trade among themselves.
Regional integration was cited as one of the key elements in improving intra-Africa trade. EAC partner states as well as COMESA member countries were singled out for proving that trade between African countries is as lucrative as trade between African countries and elsewhere.
Speaking at the opening, Abdoulie Janneh, the Executive Secretary, Economic Commission for Africa, said the continent’s share of global trade remains low, at about three percent, and continues to be dominated by primary commodity exports.
He pointed out, however, that there was cause to be more upbeat about Africa’s trade prospects following developments at the sub-regional and national level.
Janneh noted that much could be done to reap gains from intra-African trade, and expressed optimism on the scope for expansion in regional trade, with intra-Africa trade at just about 11 percent of total trade compared to 72 percent in Europe and 52 percent in Asia.
“Africa must explore and utilise the benefits of regional value chains starting with the important agro-processing sector, “he said.
According to Janneh, the inaugural African Trade Forum provides the African trade constituency with an opportunity to build on the success stories in intra-African trade in spite of various constraints.
He also highlighted what he saw as encouraging signs emerging from ECA’s analysis to be published in the forthcoming Economic Report on Africa 2012, observing that said some regional economic communities have exceeded the average intra-African trade growth.
“The intra-COMESA trade grew by at least 35.4 percent between 2009 and 2010, rising from US$12.7 billion to US$17.2 billion,” he added.
He further commended efforts by EAC, COMESA and SADC (Southern Africa Development Community) for committing to a Free Trade Area (FTA) by 2014, that will be based not just on market integration, but on shared benefits through industrialisation and infrastructural development.
Janneh emphasised that harmonisation of Regional Economic Communities’ (RECs) trade policies through a continental FTA, would result into an additional US$34 billion in intra-African exports, “just from eliminating current intra- and inter-RECs tariffs,” he said.
He added that when the non-tariff barriers are also tackled through improved trade facilitation, intra-African trade could rise to about 22 percent in the next 10 years, “all of which goes to show that if we do what is required, we can optimise intra-African trade.”