Southern African News Features                                           SANF 11 No 16, June 2011
Free Trade Area: To cover half of Africa
by Phyllis Johnson

The leaders of 26 African countries have taken another major step towards a Free Trade Area that would cover the eastern half of Africa, literally from the Cape to Cairo from South Africa to Egypt.

Meeting in South Africa on 12 June, at their second joint Summit, the leaders of three Regional Economic Communities (RECs) formally launched negotiations for the establishment of an integrated market of the 26 Countries comprising:

  • a combined population of almost 600 million people;
  • a total Gross Domestic Product (GDP) of about US$1 trillion;
  • half of the African Union (AU) in terms of membership;
  • 57 percent of the total population of the African Union; and,
  • just over 58 percent in terms of contribution to GDP.

The establishment of so-called "Grand" Free Trade Area is expected to bolster intra-regional trade by creating a wider market, increased investment flows, enhanced competitiveness, and the development of cross-regional infrastructure.

This FTA, formally known as the Tripartite Free Trade Area, is being established by the Southern African Development Community (SADC), the East African Community (EAC) and the Common Market for Eastern and Southern Africa (COMESA).

The Legal and Institutional Framework has been agreed through a Tripartite Memorandum of Understanding on Inter-Regional Cooperation and Integration signed by COMESA, EAC and SADC, that came into force on 19 January 2011.

In order to fast track preparations for implementation, the leaders have adopted a developmental approach to the Tripartite Integration process that is anchored on three pillars:

  • Market integration based on the Tripartite Free Trade Area (FTA);
  • Infrastructure Development to enhance connectivity and reduce costs of doing business; and,
  • Industrial development to address the productive capacity constraints.

In addition to launching the negotiations for establishing the Tripartite FTA, the leaders of COMESA, EAC and SADC adopted a Roadmap as well as the Negotiating Principles, Processes and Institutional Framework. They have also directed that a programme of work and a roadmap be developed for the industrialisation pillar.

The African Union Commission has expressed strong support for the Tripartite cooperation within the framework of establishing an African Economic Community and the overall African Union Vision and Strategy presented in the Lagos Plan of Action (1980) and the Abuja Treaty (1991), as well as the resolution of the 2006 Summit of the African Union that directed the AU Commission and the RECs to put in place mechanisms to facilitate harmonization and coordination within and among the RECs.

The first Tripartite Summit was held just 3 years ago in Uganda with initial commitment to implementation regarding programmes in trade, customs and economic integration; free movement of business persons; and infrastructure development amongst the three RECs.

In the area of infrastructure development, progress is already evident in the plans to strengthen the North South transport corridor between Dar es Salaam and Durban, with the support of international cooperating partners and the donor community.

Aid for Trade Programmes are being developed for the other major corridors including maritime corridors, and priority projects will be presented at a Tripartite and Inter-Governmental Authority on Development (IGAD) Infrastructure Investment Conference in Kenya on 29-30 September 2011.

The host of the recent Tripartite Summit, President Jacob Zuma of the Republic of South Africa, described the historic Summit that launched the Tripartite FTA negotiations as "a key milestone in the integration of Africa".

Egypt will host the next Tripartite Summit. 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.

This article may be reproduced with credit to the author and publisher.

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

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