African leaders unite economies

 

South African president Kgalema Motlanthe
And Ugandan president Yoweri Museveni
arriving at the Tripartite Summit in
Kampala.

African leaders at the sitting of the first
meeting of the three regional economic
blocs.
(Images: Daily Nation)

Khanyi Magubane

Heads of states of 26 African countries belonging to three economic regions across the continent, have resolved to merge the blocs into a single regional market.

The first ever tripartite summit, held in Kampala Uganda on 21 October, brought together 26 leaders of the Common Market for Eastern and Southern Africa (Comesa), the East African Community (EAC), and the Southern African Development Community (SADC).

All three regions have agreed to establish a free trade community and a single customs union.

This will stretch from South Africa to Egypt and from the Democratic Republic of Congo to Kenya.

South Africa’s President Kgalema Motlanthe represented the SADC region as its chairperson. He said that the launch of the free trade bloc would place the African continent in a stronger position to respond effectively to intensifying global economic competition.

Speaking to delegates, Motlanthe said, “Our convening here today reflects a profound recognition that sustainable integration into the global economy requires a commitment to an irreversible process of building economic, political and social unity.”

Motlanthe also emphasised the importance for African countries to have strong economic ties with each other in the wake of the current global financial crises sweeping through the west.

“The process we have embarked on today marks an important step towards the realisation of building an economic bloc in today’s challenging world that will increase the levels of intra-African trade.”

Kenyan Deputy Prime Minister and Minister of Trade Uhuru Kenyatta, also echoed Motlanthe’s views and said that the tripartite conference has come at the right time when international financial markets are tumbling, “It is important to acknowledge that the global financial crisis, soaring oil and food prices may lead to the weakening of our economies and deterioration of the global economic outlook.”

The merger, bound to create the largest free trade area in Africa, will in total, combining the three regions, represent a population of over 248-million people and have a combined Gross Domestic Product of R749-trillion (US$650 billion)

The roll out plan

During the summit, it was revealed that the three blocs would have a single airspace within a year and an inter-regional broadband network for internet.

The three communities also resolved to coordinate their master plans for regional transport and energy within 12 months.

Comesa secretary general Stephen Karangizi said the areas identified as starting points for cooperation among the member states include infrastructure development for regional integration and trade.

Karangizi said infrastructure development includes developing energy generation and transmission facilities, transport networks, telecommunication and ICT infrastructure.

The chairperson of the EAC Coordination Committee, Charles Gasana, said during the summit that the three regions need to rely more on trade rather than aid to fight poverty in Africa.

He said that this mind shift would rid the continent of the stigma it has as the world’s poorest continent. Gasana also said that trade cannot be promoted if countries set barriers that inhibit flow of goods among each other.

“We have instituted policies that encourage smooth flow of goods among each other and some members are even offering better terms of trading to developed countries.” He challenged the delegates to start offering the good terms of trade to their neighbours rather than to developed countries.

Some of the challenges that the free-trade agreement will have to overcome include the multiple memberships of some countries to various trade blocs and fear of the weaker economies of being flooded by goods from their stronger counterparts like South Africa and Egypt.

United states of Africa

The summit’s host, Uganda’s President Yoweri Museveni, told those gathered for the event, that regional integration was a powerful strategic tool for the group to use since it could ensure the prosperity of all it represents.

He said the heads of states should see the move as more than just a trade agreement but an opportunity to create politically stable climates, “Economic integration is not enough. There is need for political integration which will bring about a common army to protect the interests of Africa.

“Apart from the economic injustice by the developed world, their overwhelming military superiority is a threat to the future of Africa.”

Museveni added that the time has arrived for a united Africa to start protecting its resources,

“Some people are saying they want to build their superiority on water, air and land. Where does this leave us?” he asked the participants. “Why should Africans insure cars and bicycles but do not insure Africa?”

The three economic regions enter into the agreement as already well-established entities in their own right.

The SADC was first established in 1980, as the Southern African Development Coordination Conference in a bid to increase the participation of other countries in the then apartheid South Africa.

After dwindling in subsequent years, the organisation was reincarnated as the Southern African Development Community in 1992.

In 2006, it was estimated that the SADC region pulled a GDP of R437-trillion ($379-billion.)

Some of the social and human development and special programmes that the SADC preside over between regions includes its Hiv/Aids programmes, which has been operational for the past 20 years. They also facilitate the “Roll back Malaria” campaign, aimed at eradicating the number of unprotected people in malaria-rife areas.

The region’s social desk also runs education and skills development programmes; these are aimed at building capacity amongst the poor and unemployed.

Comesa was established in 1994 and replaced the Preferential Trade Area. Its 20 member states are Angola, Burundi, Comoros, Democratic Republic of the Congo, Djibouti, Egypt, Eritrea, Ethiopia, Kenya, Libya, Madagascar, Malawi, Mauritius, Rwanda, Seychelles, Sudan, Swaziland, Uganda, Zambia and Zimbabwe.

According to its objectives, Comesa strives to create a level playing field, i.e. one that allows free and fair competition within the principles of market economics.

The countries are engaged in issues of prevention and post-conflict reconstruction, strengthening of democratic infrastructure, and development of a vibrant culture.

It includes 398-million people and in 2006, the area had a combined GDP of R33-trillion ($286.7-billion.)

The smallest of the three, EAC, had a GDP of R537-trillion ($46.6-billion) in 2006. Established in 1967, disagreements between founding members Uganda, Kenya and Tanzania led to its collapse.

On 30 November 1999, 32 years after the demise of the EAC, a treaty was signed, re-establishing the organisation and on 7 July 2000, the EAC officially started its work again.

The EAC aims at widening and deepening co-operation among the partner states in, among others, political, economic and social fields for their mutual benefit. In 2005, the EAC countries established a Customs Union and are currently working towards the establishment of a Common Market by 2010.

Some of its other future plans include; a Monetary Union by 2012 and a Political Federation of the East African States.

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