Botswana: Trade Imbalances Obstacle

Gaborone — The African Continental Free Trade Area ratified by constituent countries of the African Union is a laudable move and care should be taken to address areas that could be constraints to its implementation.

This was the view expressed by former President, Dr Festus Mogae, while partaking in a panel discussion at the Global Expo in Gaborone.

Dr Mogae said African states had made great strides in moving towards greater economic cooperation, but there were many logistical challenges that could impede its successful implementation.

"We no longer have visible ideological differences and there are many other positive developments that have taken place. But, while we could benefit from pooling our resources together, we need to address challenges such as the huge trade imbalance that exist between countries," Dr Mogae said.

He explained that in Southern Africa, the scenario was that South Africa was the major industrial player and only a few decades ago the rest of the countries in the region were providing unskilled labour for South African mines and industry.

While the other states have since improved their economic standing, Dr Mogae noted that they were not yet ready to compete on the same footing with regional giants such as South Africa, where there was still a concern of unskilled migrant workers migrating there in numbers, fuelling xenophobia.

African countries need to work on looking at areas where they can complement each other, without the one dominating the other, and ordinary people need to be brought on board to understand the impact of the trade protocols that their leaders agree to on their behalf, said Dr Mogae.

"I do not know of any African state that engages the population to consult before or after signing these continental protocols, yet failure to do so exacerbates the inability to implement. Again, protocols are often signed without thorough acknowledgement of potential constraints which need to be addressed to smoothen the process of implementation," he said.

The eminent statesman lauded progress made between countries in terms of advancing cooperation, giving the example of the Kazungula Bridge constructed by Botswana and Zambia, which, he said, would benefit many countries in the region in terms of transport linkage and smoother movement of goods.

Dr Mogae also said Botswana and Namibia had over the years forged strong ties which he said were seamless, since the two countries had similar geographical makeup and economies, but had areas such as the Namibian access to the sea which complemented the landlocked nature of Botswana; while Botswana provided Namibia with access to other African markets through road, and possibly in future rail transport links.

Former cabinet minister and Phakalane Estates founder, Mr David Magang said intra-African trade was important, but agreed with Dr Mogae that there were many areas that needed to be addressed and said the success of regional blocks was important.

"The intention of creating regional economic blocks such as the Southern African Development Community (SADC) was to ensure that integration starts within each region and could be steadily built across the continent. But, while we have had over a century of economic cooperation in the form of the Southern African Customs Union (SACU), generally African economic still lack synergy within their regions, and have little access to other regions," Mr Magang said.

He said African states needed to develop skilled labour that is able to contribute towards economic development and produce quality products for export, and that different countries needed to develop their comparative advantage niche to export to the others.

Mr Hussein Hassan, the acting director of Trade and Industry at the African Union Commission said African countries should explore how to maximise the benefit of integration.

"Each country should identify high capacity areas to produce, and aim to be competitive, through producing high quality standard goods.

There is also the need for coordination and harmonisation of standards, business law and customs among African states," Mr Hassan said.

Source : BOPA

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