Free trade area to launch this yearComment on this story
An agreement to lower barriers to trade and improve cross-border commerce in the SADC should be implemented this year, Trade and Industry Minister Rob Davies said on Monday.
“Market integration is well-advanced in the SADC. The SADC Free Trade Area (FTA) should be fully implemented in 2012, with almost all tariff lines (products that have tariffs imposed on them) traded duty-free,” Davies said.
He said South Africa was making a priority of consolidating the Southern African Development Community (SADC) FTA and was working with member nations to implement their obligations.
This meant a focus on co-operation, promoting regional production and infrastructure, addressing non-tariff barriers, and simplifying rules and standards.
Davies said negotiations had begun to create a regional common market, T-FTA, with the first stage to cover trade in goods.
These negotiations would have a deadline of April 2014 with implementation in 2015.
“This ambitious deadline provides the impetus to work expeditiously on the trade integration pillar to which we are all committed,” Davies said.
He said the combined market would involve 26 countries with a population of 600 million and a combined GDP of US1 trillion, “providing the market scale that could launch a sizeable part of the continent onto a new developmental trajectory”.
This agreement would also form the basis of a continent-wide FTA that would help overcome the challenges of small and fragmented economies.
“A larger, more integrated and growing market would enhance the interest of foreign investors in Africa and provide an important underpinning for continuing to enhance intra-African trade,” Davies said.
Davies said the continent had the potential to be a leader in economic growth due to its raw materials, young population, growing middle class, and improving economic governance. Africa also had 60 percent of the world's unused arable land.
He said this potential would be unfulfilled if nations did not address the problems of poor infrastructure, small markets, and a lack of diversity of industries.
“All of which are responsible for the low levels of intra-African trade,” Davies said. - Sapa