From: Berhane Habtemariam (Berhane.Habtemariam@gmx.de)
Date: Wed Oct 22 2008 - 16:07:11 EDT
Africa's regional blocs agree to free trade union
Wed 22 Oct 2008, 14:04 GMT
By Jack Kimball
KAMPALA, Oct 22 (Reuters) - Three African trading blocs agreed on Wednesday to create a free trade zone spanning 26 countries and to establish joint infrastructure and energy projects.
The zone would help streamline access to markets within African regional bodies with an estimated gross domestic product (GDP) of $624 billion. Many African nations belong to conflicting and overlapping groups.
"The greatest enemy of Africa, the greatest source of weakness has been disunity and a low level of political and economic integration," Ugandan President Yoweri Museveni said.
"Bigger markets are a strategic instrument of liberating people from poverty," he said at a meeting of heads of state who chair the Common Market for Eastern and Southern Africa (COMESA), the East African Community (EAC) and the South African Development Community (SADC).
The EAC already has a functioning union and COMESA plans to launch its own by December this year. The 15-member SADC plans a customs union in 2010 and 12 of its members launched a free trade zone in August.
Analysts say that the continent has yet to fully exploit intra-regional trade as a way to boost growth.
The final communique from the meeting said the ultimate goal would be the establishment of a single customs union.
The final document said the timeframe for integration would be decided in one year. The groups will also move to harmonise transport, technology and energy plans.
Rwandan President Paul Kagame said the blocs should take steps to ease the impact of integration on smaller economies.
Delegates at the meeting said unifying would also help defend their interests when negotiating Economic Partnership Agreements (EPAs) with the European Union to replace preferential trade deals, which expire at the year's end.
"The negotiations on economic partnership agreements ... risk weakening Africa and may further balkanise the continent," said Erastus Mwencha, deputy chairman of the African Union Commission.
A senior South African official said the proposed free trade area (FTA) would strengthen its members' negotiating position in international trade talks.
"When we've got a pan-regional FTA we've then have a legitimate basis to negotiate as a block so that some of these internal contradictions that arise as we negotiate as separate regions begin to be taken away," Ayanda Ntsaluba, director general in the Department of Foreign Affairs, told Reuters in Cape Town.
"We don't think its going to be an easy process... (but it's) the only viable path the continent can take if it wants to play in this global environment," Ntsaluba said.
The EAC has agreed to a temporary trade deal with the EU, effectively securing a one-year reprieve. Kenyan President Mwai Kibaki said COMESA had reached a similar pact.
The trade zone would include Angola, Botswana, Burundi, Comoros, Djibouti, the Democratic Republic of Congo, Egypt, Eritrea, Ethiopia, Kenya, Lesotho, Libya, Madagascar, Malawi, Mauritius, Mozambique, Namibia, Rwanda, Seychelles, Swaziland, South Africa, Sudan, Tanzania, Uganda, Zambia and Zimbabwe. (Additional Reporting by Wendell Roelf in Cape Town; Editing by Wangui Kanina and Giles Elgood)
© Reuters 2008. All Rights Reserved
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