Comesa set to join world's most vibrant blocs in two years
Mr Karangizi; Member states have submitted their national tariffs to align with the Common External Tariffs. File Photo
Comesa could become one of the vibrant trading blocs in the world in the next two years, the Assistant Secretary General Programmes, Stephen Karangizi, has said.
He called on member states to accept external investment, adding that Comesa is expected to generate about $3 billion to $15 billion during the first three years after the launch of the Customs Union in June 2009.
In an interview recently on the performance of the Comesa Customs Union, Mr Karangizi said Comesa’s Customs Union is intended to create Common External Tariffs, provide trade remedies and conduct trade export promotion for member states.
The Customs Union has since June 2009 been given a transition period of three years, with a midterm review this month.
Comesa envisages moving the member states into a single Customs Union, deepening the process of regional economic integration and establishing a Common Market by 2015.
Mr Karangizi said there was a need to create a stable investment environment by attracting business from outside the region. He cited China as an example of an economy that has been built by investment from outside.
“We should not, therefore, be hesitant to accept external investment,” he said. Mr Karangizi said that the Customs Union would complement investment in the region by creating a level playing field though harmonised trade imbalances such as import duties.
He said the Customs Union would also address the problems associated with the cost of production and transport infrastructure among member states.
“We are deepening integration to move with the momentum of trade,” he said. He added that the majority of Comesa member states have since submitted their national tariffs to align with the Common External Tariffs under the Customs Union.
Comesa, he said, would soon receive a report on the alignment of national tariffs that will be tabled before the inter-governmental committee.
Zambia’s Cross Border Traders’ Association Chairman General Elliot Kabinda was optimistic that the Customs Union would help improve the living standards of ordinary people in the member states.
He said the Simplified Trade Regime — as demonstrated by the launch of one-stop-border post — would help small cross-border traders conduct their business without the current challenges.
The Customs Union entails that goods entering the Comesa market will move freely with the elimination of tariff barriers.
With a total population of 420 million, the Customs Union will be an attractive market.The launch of the one-stop-border post at Chirundu, on the Zambia/Zimbabwe border, will accelerate the pace of regional trade. The border post will reduce delays caused by lengthy Customs procedures, cut costs of doing business and improve competitiveness.
Functional one-stop-border posts in the region include the Malaba border post between Kenya and Uganda. According to Comesa’s 2009 annual report, informal intra-trade was estimated at $19 billion, exceeding the formal trade estimated at $14.3 billion.
“The inclusion of intra-Comesa informal trade is expected to raise trade value to $34 billion,” the report states.
“Informal cross border trade has, therefore, become imperative for Comesa’s planning process,” it said. The annual report noted that in 2008, the intra Comesa investment was at $1 billion.
