Africa Biz Construction and Business News
AfDB Says Balance Needed in Multilateral versus In-Africa Country Agreements
September 8, 2017
As African agreements accelerate in number and complexity on the world stage, the African Development Bank has emphasized the need to ensure balance between those and East Africa's regional integration agenda.
African Development Bank Director General, Eastern Africa, Gabriel Negatu, made this call at the first Regional Dialogue on WTO accessions for the Greater Horn of Africa Region, which concluded in Nairobi on August 30, 2017.
Negatu urged the acceding countries to be wary of making concessions beyond what they have availed to their neighbours under regional trading arrangements such as East Africa Community (EAC), Common Market for Eastern and Southern Africa (COMESA) and the tripartite arrangement.
Movement of persons is a clear example of instances where African countries have historically discriminated against one another while offering more generous access to non-Africans, he noted. According to the 2016 Africa Visa Openness Index (published jointly by the Bank and the African Union Commission), on the average, Africans need visas to travel to 55% of other African countries. It is easier for Americans and Europeans to travel within Africa than it is for Africans to do so.
The Dialogue was convened to reflect on ways in which membership of the World Trade Organization (WTO) could foster regional integration and cooperation; to exchange experiences and lessons learned from the accession processes in the region; and to mobilize support for facilitating African accessions.
Participants agreed on the urgent need to enhance trade policy knowledge, capacity and resources in the region for analysis, strategy development and negotiations.
High-level speakers at the event included Ministers of Trade from Ethiopia, Sudan, South Sudan, Somalia, Comoros and Liberia; Amina Mohamed, Kenya’s Cabinet Secretary for Foreign affairs Peter Mbithi, Vice Chancellor of the University of Nairobi, and senior officials from the WTO Accessions Division.
Five countries in the region namely − Ethiopia, Sudan, Comoros Somalia and South Sudan− recently rekindled their interest to join the WTO.
Negatu acknowledged the positive impacts that the WTO accession process could have on fostering regional integration and stressed how the accession process could be a driver for broad economic and trade policy reforms that countries may be otherwise reluctant to undertake.
He said the accession process entails a comprehensive review and upgrading of a range of trade-related policies in line with international norms which he listed to include policies on foreign exchange and payments; investment regime; state ownership, privatization and state trading entities, industrial policy including subsidies, product standards and certification, free zones and special economic areas, agricultural policies, transit regimes, and trade agreements with other parties.
Such market-oriented reforms, he explained, could promote transparency, predictability, and help to improve regional member countries’ business environment.
The AfDB DG underscored the importance of proper sequencing, noting that in many African countries (including those in the Horn of Africa), traders are characterized as poor, informal, and of the small and medium enterprises category. They lack the expertise to export effectively to advanced country markets, where technical requirements (like sanitary and phytosanitary regulations) can be difficult to meet for new entrants.
Regional integration, therefore, offers an opportunity for African countries to promote trade amongst themselves to realize the structural transformation that they seek; and to better prepare themselves to step up to the global stage by acceding to the multilateral trading system under the WTO.
The original WTO members in the region, such as Kenya, and the countries seeking accession shared their experiences at the Dialogue. Liberia and Seychelles, both of which recently concluded their accession process, also shared their experiences and lessons, focusing mainly on the need for thorough preparation.
Participants appealed to development partners represented at the meeting to step up support for their accession process and subsequent implementation.