12 Aug 2015

 

The Southern African Development Community (SADC) has only managed to achieve a Free Trade Area (FTA) amongst the milestones the community had set up in its endeavour of regional economic integration. 

In its Regional Indicative Strategic Development Plan (RISDP) which ran from 2003-18, the regional block had envisaged creating a FTA by 2008, a Customs Union by 2010, a common market by 2015, monetary union by 2016 and an economic union with a single currency by 2018. 

The SADC director of Trade, Industry, Finance and Investment, Ms Boitumelo Gofhamodimo acknowledged the short comings, adding however that although they were now concentrating on further integration for the remaining five years, the milestones remain important. 

“While advancement of the integration agenda has not progressed beyond the FTA, the set milestones remain relevant in the medium to long-term, and a thorough assessment was still to be undertaken within the framework of the revised RISDP to set out reasonable timeframes, but most importantly, to ensure a solid foundation has been created to enable the region to advance its integration process,” she said. 

She said work continues to ensure a firm basis for integration, building up to the next stages beyond the FTA.  Talking about their achievement, Ms Gofhamodimo said so far 85 per cent of goods were zero rated by almost all countries.

She said maximum tariff liberalisation was attained in 2012 when tariffs on sensitive products were removed.  Trade has also dramatically increased from US$89.3 million to US$394 million. 

“Most of the exports are in primary commodities, highlighting an urgent need to diversify and improving the productive capacity of the economies of the region,” she said. 

Ms Gofhamodimo further said trade with the rest of the world was also expected to increase, particularly with the new initiatives, including the operationalisation of the Tripartite FTA and Economic Partnership Agreements that involve SADC member states. 

Meanwhile, she said the FTA allows members to protect infant industries, but that measures must be regulated with the period clearly defined. 

This however has not proven to be popular amongst consumers as import duty is imposed on externally procured goods hence they pay hefty prices. 
She further said infrastructure has to be up to standard to enable free and hassle free movement of goods across borders. ENDS