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close this bookThe Courier N 184 - Jan - Feb 2001 - Dossier: Press and Democracy - Country Reports: St Kitts and Nevis (EC Courier, 2001, 96 p.)
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View the documentCOMESA - Africa's first Free Trade Area
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COMESA - Africa's first Free Trade Area

by Shapi Shacinda

The Common Market for Eastern and Southern Africa (COMESA) has created Africa's first Free Trade Area, which guarantees the free movement of goods and services and the removal of all tariff and non-tariff barriers.

African leaders praised the launch as the first step towards the creation of an African Economic Community.

Nine of COMESA's 20 members - Djibouti, Egypt, Mauritius, Madagascar, Malawi, Kenya, Zambia, Zimbabwe and Sudan - were in the first wave of countries entering the FTA when it was formally launched in the Zambian capital of Lusaka on October 31 2000.

Namibia and Swaziland have had their derogations to apply reciprocal tariffs extended for a limited time, until technical issues relating to their membership of the Southern African Customs Union have been resolved.

Six other COMESA states - Burundi, Democratic Republic of Congo, Eritrea, Rwanda, Uganda - have all reduced their tariffs by between 60% and 80% and will enjoy market access on a reciprocal basis.

COMESA has a combined population of 380 million, and covers 12,886,591 km2. Its gross domestic product is $166 billion. Intra-COMESA trade stands at just $4.2 billion from a total annual trade of $63 billion.

A Customs Union by 2004?

COMESA hopes to become a Customs Union by 2004. Then it will launch efforts towards a common monetary union with a common central bank by 2025.

African leaders at the launch agreed to uphold democratic principles, good governance, peace and stability to attract direct foreign investment and increase intra-regional trade.

“There are many challenges posed by globalisation. We should realise that it is time we got our priorities right and served our people. We must reduce poverty and increase trade within the region,” said Kenyan President Daniel arap Moi.

Zambian President Frederick Chiluba views the FTA as an impetus for job creation, and as a way of attracting direct foreign investment.

Chiluba said the region, although the worst-affected by HIV/AIDS, poverty and conflict, has the potential to improve the lives of its people.

Many COMESA states are in the throes of, or just emerging from, conflict. They include the former Zaire, Sudan, Angola, Eritrea, Ethiopia and Zimbabwe. Kenya's President Moi and Malawi's President Bakili Muluzi are among the sternest critics of war in the region, saying they cannot understand why governments spend millions of dollars on war instead of improving the lives of their impoverished citizens.

Problems

A huge external debt ($124 billion for COMESA states, with a debt to exports ratio of 396%), the flight of professionals to better-paying Western countries, the slow pace of technology improvement and slow training of skilled technical professionals are some of the other hurdles the COMESA FTA will have to overcome.

Sir Anerood Jugnauth, Mauritian Prime Minister and chairman of the COMESA Authority of Heads of State and Government, feels that COMESA will encourage members to upgrade their road and railway networks and improve telecommunication and facilities for efficient transportation of goods.

COMESA started off as the Preferential Trade Area in 1981 and its goal has always been to enhance intra-African trade and improve the lives of the continent's citizens.