Southern African News Features                                           SANF 09 No 08, May 2009
COMESA to unveil Customs Union as Zimbabwe assumes chair
by Kizito Sikuka

The Common Market for Eastern and Southern Africa (COMESA) is set to launch its Customs Union during its 13th annual Heads of State and Government Summit scheduled for 7 to 8 June 2009 in Zimbabwe’s resort town of Victoria Falls.

The summit, which will be preceded by various policy organs meetings from 28 May, had been originally scheduled for last year before it was deferred to this year to pave way for Zimbabwe, which takes over the chair from Kenya, to complete its electoral process.

The meeting will undoubtedly be a landmark occasion for the 19-member regional body in terms of the targets and programmes set for the year 2009.

The regional economic bloc, formed in 1994 to replace its forerunner, the Preferential Trade Area, has set itself a number of targets that it wants to achieve and implement this year to enhance co-operation among member states.

The long awaited launch and establishment of the COMESA Customs Union is one such goal that would finally become a reality as it would be launched on 7 June.

The Customs Union has been deferred many a times due to logistical problems and lack of commitment by some member states in implementing agreed resolutions on time.

Therefore, Zimbabwe, as the new chair in 2009, will be faced with an uphill task of ensuring that all countries pledge their unwavering support towards the eventual success of the Customs Union.

The Customs Union aims, among other things, to promote the free movement of goods and services across member states and harmonize all regional trade policies to promote equal competition.

Removal of trade barriers such as huge export and import fees would also enable countries to increase their earnings, penetrate new markets and contribute towards their national development.

However, despite the numerous benefits, Zimbabwe would, as chair of the union, also be expected to tackle head-on some of the burning challenges that may result from such a regional development.

Less prepared nations are at risk of being swallowed by more powerful nations, as their local industries would suffer from the stiff trade competition from more rival firms in an open market.

The competition may subsequently allow the more organised and developed nations to push weaker local firms out of business. Hence member states such as Zimbabwe must smartly address such pertinent issues without courting controversy.

Another mammoth assignment would be the thorny and sticky COMESA versus the Southern African Development Community (SADC) issue even though the three regional blocs, together with the East African Community (EAC), are working towards integrating their projects.

At the 2006 SADC Heads of State and Government meeting in Maseru, Lesotho, member states resolved that each country should be party to only one regional bloc to avoid conflict of interests, especially with the imminent launch of the SADC Customs Union in 2010 and the soon-to-be launched COMESA Customs Union.

Furthermore, World Trade Organization regulations prevent member states from belonging to more than one Customs Union for reasons of a technical nature.

Thus effectively this means that a country has to be either a member of SADC or COMESA Customs Union, a decision that is likely to be very difficult for most member states that belong to both blocs. Zimbabwe and many other SADC countries are still to decide on which bloc to join.

However, Zimbabwe on its part has since indicated that it would remain guided by the industry and other stakeholders on which bloc to join as both groupings offer lucrative trade opportunities.

"Any decision to choose whether the country should join SADC or COMESA will be guided by the industry and a number of other factors," the Zimbabwean government has already declared.

With the imminent launch of the COMESA Customs Union, Zimbabwe, along with other SADC countries namely the Democratic Republic of Congo, Madagascar, Malawi, Mauritius, Swaziland and Zambia, may have to make that decision sooner rather than later.

And to think that all these crucial decisions must be made this year when Zimbabwe is chair of COMESA goes further to show how important the country’s role will be in shaping the future of COMESA.

"The expectations from Zimbabwe are huge," said one analyst, "but I am confident that the country will deliver".

Other pertinent issues expected to be addressed during Zimbabwe’s tenure as chair include the full participation of all member states in the COMESA Free Trade Area (FTA) by end of the year. The FTA, established in 2004, calls for the removal of all tariffs and non-tariff barriers within the region.

Work to liberalise the skies is also likely to top the agenda for the 2009 summit. An Open Sky policy promotes competition in aviation within regional routes thereby reducing the cost of air travel and transport in the region.

The development also encourages regional trade and integration among COMESA members and would be in line with the anticipated commercial traffic within the Customs Union.

sardc.net

Southern African News Features offers a reliable source of regional information and analysis on the Southern African Development Community, and is provided as a service to the SADC region.

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SANF is produced by the Southern African Research and Documentation Centre (SARDC), which has monitored regional developments since 1985

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