Gaborone — The African Continental Free Trade Area (AfCFTA), which came into operation on January 1, presents Botswana with many opportunities to exploit its huge potential for industrial growth.
Botswana's position makes it a suitable location as a hub for both goods and services production and distribution.
These are the views of Ministry of Investment Trade and Industry chief negotiator, Mr Phazha Butale regarding the continental trade agreement among 54 of the 55 African Union member states.
For Botswana, President Dr Mokgweetsi Masisi signed the agreement on February 10, 2019 thereby reaffirming government's commitment towards economic growth and diversification.
In an interview with BOPA, Mr Butale said AfCFTA provided huge opportunities for development in the areas of industry, infrastructure and market liberalisation while also providing an avenue for the flourishing of trade in services.
He said with the implementation of the agreement, local importers would have access to cheap inputs in the form of raw materials which they could use to add value and export finished products to the African continent which boasts a population in the region of 1.3 billion.
"For this trade to prosper there will be a need for the development and indeed utilisation of enabling infrastructures such as roads, rail, and inland bridges. On the side of trade in services opportunities are abound in financial or non-banking services like insurance and micro-lending, energy sector and transportation," he said.
Mr Butale said the ministry had and continued to engage all stakeholders to ensure the best possible deal for Botswana as well as facilitated the industrial sector to be able to exploit the new market that would be availed.
He said government, through state owned enterprises such as Botswana Investment and Trade Centre (BITC), Local Enterprise Agency (LEA) and Botswana Export Credit Insurance (BECI) assisted exporters to access markets while also protecting them through export credit and insurance.
About Botswana's position on tariff negotiations concessions, Mr Butale indicated that the latest tariff offers were received late December and were in the analysis stage to establish whether they met the test of reciprocity and value proposition for Botswana.
"Our preliminary findings are that some offers have more than others and the next step will be to engage our negotiating partners with a view to ensuring equitable weighting of their offer with that which we have given them," he said.
He said Botswana would seek the necessary authority to ratify the agreement in accordance with internal laws and procedures once it was satisfied that the offer met the level of ambitions to enable industrial development.
In a related interview, Business Botswana president Mr Gobusamang Keebine expressed optimism about the AfCFTA agreement saying it would create opportunities and benefits for local entrepreneurs.
Once implementation commenced, AfCFTA would enable local entrepreneurs to expand their markets by exporting goods and services across the continent, he said.
Mr Keebine said it would also contribute to the growth and diversification of the economy through job creation as well as reduce tariffs and benefit entrepreneurs, including small to medium business enterprises.
Describing the agreement as an opportunity for African entrepreneurs to start working together in a trade tariff-free environment, he pleaded with local business people to position themselves in order to benefit from inter-regional trade.
"It is important that local producers strive to meet the minimum exportation standards in order to benefit from the AfCFTA," said Mr Keebine.
He said it was in the best interest of the business community to develop a sense of entrepreneurship and fully tap on the opportunities created by a single market of goods and services for 1.3 billion people in the African continent.
The advent of AfCFTA, which creates a single continental market for goods and services in Africa, is set to boost economic growth and is a glimmer of hope for Botswana's economic diversification and employment creation ambitions.
Source : BOPA