South Africa is to establish a free trade zone between its southern African neighbours and its counterparts in the eastern and western regions of the continent.
In an exclusive interview with Business Report yesterday, Deputy Trade and Industry Minister Mzwandile Masina said South Africa was close to finalising key trade agreements with the rest of the continent, which would be realised within the next five years.
Masina said negotiations with the rest of the continent were at an advanced stage, and that the agreements could be realised before the 2063 African Union (AU) deadline for free trade in the continent.
“Next week we will be hosting the AU summit. Among the discussions on the economy would be a continental free trade area that we will be launching, which is basically going to be a continental body which we are going to use as a trading bloc among Africans,” Masina said.
“This trading bloc consists of 26 countries which comprise more than half of the total population of the continent.”
South Africa had long embraced the idea of a free trade regime within the continent that would be worth billions of rand among the continent’s economic powerhouses of Nigeria, Egypt, Kenya and the Southern African Development Community but its intentions have been clouded by regional politics and fears that current trades were skewed highly in favour of it.
Benefit for all
But Masina said the envisaged trade regime would see countries that are lagging behind economically being able to benefit from the total overhaul of the economic prospects.
“That is why now we are having to talk about the free trade area which will involve the entire continent of Africa so that we can speak with one voice with Europe, with other Brics members countries and any other important trading blocs,” Masina said.
“And obviously the AU summit will talk to half of what we are trying to do. One of the missions of the AU is to achieve a home for a united prosperous continent by 2063, issues like how do we ensure that we can create common markets and I am saying that the continental free trade area is going to be a free trade area for the continent but also to engage the rest of the world about how we facilitate the movement of goods.”
Masina said Africa could not just export goods to other continents as it had more than enough bargaining power to ensure its wealth and minerals were traded first among its countries before it was offered to the rest of the world.
Consensus
He said while there was a general agreement among AU member states that the continental trade was an imperative, the continent was busy working on harmonising its internal legislative processes so that each country could benefit from the deal.
“We are almost there so in the next two years or so we should be able to scrape through all the legislative issues so that we are ready for the signing of the continental free trade area,” said Masina.
Masina even defended the county’s controversial visa regulations, which came into effect on Monday, demanding, among other things, that children accompanied by parents must possess unabridged birth certificates on entering or leaving the country.
He confirmed that there were high-level talks in the cabinet to discuss a possible review because the legislation had unintended consequences.
“In the next 10 years we are going to escalate the work that we do in the continent so that we have got new markets, so that is why we need to address the concerns because we have to have space where we can move our goods and services.”
On the recently signed deal between SAA and black industrialists, Masina said the government would not apologise to anyone for promoting the idea.
“You know that (we) are going to procure goods and services in the next few years of not less than R4 trillion, a huge chunk of that should go to these black industrialists so that we promote them… We are ready to go to cabinet with a policy on how we are going to roll out this particular programme. We will succeed; we will meet our targets and even exceed them.”