The final step in harmonising finance, investment and other macroeconomic policies in Southern Africa, which could lead to the increase of foreign direct investment in the region, was taken on Monday.
The majority of members of the Southern African Development Community (SADC) signed the Protocol on Finance and Investment at an extraordinary summit of heads of government and state held in Midrand, between Johannesburg and Pretoria.
Botswana’s President Festus Mogae, Swaziland’s Prime Minister Absalom Themba Dlamini and Zimbabwean President Robert Mugabe on Monday became the latest signatories to the protocol.
It brings the number of countries to ten up from the seven — the Democratic Republic of Congo, Lesotho, Madagascar, Mauritius, Mozambique, South Africa and Tanzania — who signed it in August. Nine countries had to sign the protocol to get it implemented in SADC.
SADC considers it as the cornerstone in improving the economic environment as well as the attractiveness of the region as an investment area.
It would promote the region as a single investment area rather than a collection of individual countries and as such needed the area to come up with standard investment policies.
The protocol would also complement the move towards a Free Trade Area, which would be the first step towards one monetary union, similar to the European Union, in Southern Africa.
”It would appear that the region is on course for the establishment of a Free Trade Area by 2008,” said Lesotho Prime Minister and current SADC chairperson, Pakalitha Mosisili.
The Free Trade Area would be followed by the establishment a Customs Union by 2010, a Common Market by 2015 and Economic and Monetary Union by 2018.
”Summit noted that SADC trade patterns consist mainly of commodities and that there is need to diversify the economies and increase intra-regional trade and growth,” the final communiqué of the summit noted.
”The talks today [Monday] were focused on ensuring that we are all winners and that there would be no losers in integration, that the small economies will be also catered for and will benefit fully,” said Mosisili. — Sapa