• May 28th, 2020

Trade figures put Sadc to shame

Beyond political rhetoric, intra-African trade has remained lip service.
And visiting Tanzanian President John Magufuli did not mince his words when expressing shock this week that for the past five years trade between his country and Namibia stood at less that N$360 million.
Beyond repetitive conferences and workshops, where commitments and promises of renewal are made, trade between African countries remained subliminal.
In the case of Namibia and Tanzania, the two Sadc countries share a perfect political history but there’s nothing to show for it in terms of transforming that relationship into economic opportunities.
China, Germany, Japan, India, the European Union, United Arab Emirates, United Kingdom, Kenya, Japan, India and South Africa are listed as Tanzania’s main trading partners.
Only a single African country features on that list, as if other African countries do consume coffee, cotton, cashew nuts, tea or tobacco – Tanzania’s main exports.
As long as Africa produces what it doesn’t consume and consumes what it doesn’t produce, intra-continental trade will never reach even half of its potential.
Of all Africa’s total trade, only between 10 and 12 percent is intercontinental. 
Comparable figures are 40 percent in North America and 60 in Western Europe. 
Magufuli spoke about regional integration and the need to make it a reality within Sadc. And it is things like improved trade that would bring us closer as a people.
Other continents have succeeded at intra-trade because they deliberately made progress on having transport, energy and information and technology infrastructure in place.
On the contrary, African trucks carrying import and export goods spend weeks in border queues, waiting to be cleared. No serious trade would become full-blown under such tardy circumstances.
As Masimba Tafirenyika writes, there is much that African countries need to do to increase intra-regional trade. For instance, they need to reduce dependence on commodities by expanding the services sector, including telecommunications, transport, educational and financial. 
They need to increase investments in infrastructure. And they need to eliminate or significantly reduce non-tariff barriers that are major roadblocks to intra-African trade. 
The list of non-tariff barriers is as long as it is comprehensive, ranging from prohibitive transaction costs to complex immigration procedures, limited capacity of border officials and costly import and export licensing procedures. For this to happen, it will take much more than political commitments; it will require practical steps on the ground even if they come with some costs. 

Staff Reporter
2019-05-31 09:37:34 | 11 months ago

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