DARREN SCHUETTLER, Johannesburg | Thursday
THE Southern African Development Community (SADC) said this week it did not expect competition from a rival African free trade area and said its own deal was on track to begin cutting tariffs early next year.
”I don’t see competition necessarily,” SADC acting chief economist Angelo Mondlane said after the launch this week of a free trade area by the Common Market for Eastern and Southern Africa (COMESA).
”I think SADC and COMESA should be building blocks toward the same objective – an enhanced African market,” he added.
Nine countries in the 21-member COMESA pledged to immediately tear down tariff and non-tariff barriers and guarantee free trade of goods and services. The move is a first step toward planned economic integration by 2025.
Last month eleven SADC members implemented a much-delayed free trade deal, but the agreement calls for a more gradual removal of trade barriers to 2012.
Mondlane acknowledged concerns that dual membership in COMESA and SADC could create complications in trade policy and harmonisation of macro-economic policy.
Eight African countries are members of both organisations.
”There might be contradictions in overlapping membership, but in the long run it should not be a problem,” he said.
Under the SADC deal implemented on September 1, member states have six months to file the necessary documentation before the first round of tariffs are abolished on 47% of goods traded in the region.
Mondlane said three countries – South Africa, Swaziland and Mauritius – had so far completed the process.
”The implementation of a trade protocol is not something that is easy to do. That is why we had a six month period for countries to get ready and get started,” Mondlane said.
The deal calls for 85% of trade to be tariff-free by 2008, with the remaining 15% free by 2012. SADC still has to work out a timetable for eliminating non-tariff barriers, such as export subsidies.
The 14 SADC states are Angola, Botswana, Democratic Republic of Congo, Lesotho, Malawi, Mauritius, Mozambique, Namibia, Tanzania, South Africa, Seychelles, Zambia and Zimbabwe.
SADC has a combined population of 200 million and gross domestic product (GDP) of $176bn. – Reuters