Transcript OPERATIONLISATION OF REGIONAL AND MULTILATERAL …

WHAT ARE THE LESSONS TO
BE LEARNED FROM THE
EXPERIENCE OF COMESA IN
REGIONAL INTEGRATION
presentation by
Tasara Muzorori, COMESA
Membership and vision
• Formed in 1981 as PTA and transformed into COMESA
in 1994.
• Current membership 19 members stretching from
southern to northern Africa. Some members of COMESA
are also members of AMU, EAC, SADC,IGAD, IOC.
• Vision is to become a fully integrated, internationally
competitive regional economic community in which
there is prosperity evidenced by high standards of
living for its people, political and social stability and
peace, and a community within which goods,
services and labour are free to move across national
borders.
STATUS OF INTEGRATION
• Notified to the WTO as a regional
organisation on June 29, 1995
• Is recognised by the African Union as one
of the RECs for eventually building the
African Common Market
• Attained FTA status in Oct. 2000 initially
with 9 members, now 13.
• Envisages moving into a CU in 2008
REGIONAL INTEGRATION
ACTIVITIES
• A number of activities have been put in place by
COMESA to improve the regional integration and
to facilitate trade.
• In the early days, a Clearing House was
established to minimise the use of hard currency
in intra-regional trade transactions
• Comesa has also adopted an outline of a
customs document (the COMESA-CD) which is
simplified and in some cases has eliminated
upwards of 30 separate documents.
Regional Integration activities Cnd
• COMESA has rules of origin to ensure that
goods accorded preference result from some
level of activity generated from within the
member states
• However, with the low level of development of
most of the membership, the efficacy of ROO is
questionable.
• The ROO are administered essentially by the
certificate of origin. The system favours large
and established firms, whereas in the less
developed countries a sizeable amt of trade is
by small scale cross-border traders.
ACTIVITIES TO FACILITATE
TRADE
• In the transport area, COMESA has a system of
harmonised transit charges for heavy vehicles
and buses
• The Yellow Card system whereby if a vehicle
owner buys the insurance, it is valid in all the
other countries participating in the scheme
facilitates regional travel
• the COMESA carrier’s licence works a lot for the
efficient utilisation of commercial vehicles. The
licence allows commercial vehicles to be
licensed with one licence which is valid
throughout the region.
ACTIVITIES TO FACILITATE
TRADE CONTD..
• The Regional Customs Bond Guarantee scheme is yet
to come into effect, is meant to achieve regional
recognition of a Customs bond. This is expected to
release substantial amounts of money tied up in these
bonds.
• The sub-Saharan African region is perceived as a high
risk area. Hence to deal with this perception, COMESA
came up with the idea of an African Insurance Agency
which covers political risk.
• COMESA has a host of other cooperation activities in the
areas of infrastructure development, private sector
development, investment, gender, and agriculture.
ACTIVITIES TO FACILITATE
TRADE CONTD…
• COMESA is working on a concept of one
stop border post for contiguous countries
so as to facilitate clearance of traffic at the
borders.
Intra-COMESA Trade
Intra-COMESA trade % of Total COMESA trade
Percentage
9.00%
8.00%
7.00%
6.00%
5.00%
4.00%
3.00%
2.00%
1.00%
0.00%
1997
1998
1999
2000
2001
Year
2002
2003
2004
2005
• Intra-COMESA trade
increased somewhat
after the region
attained FTA status.
• The level, though stil
remains low.
• Currently carrying out
Trade Flow Analysis
to find out reasons
why intra-trade is low.
COMESA and Multilateral Trade
Agreements
• COMESA is notified with the WTO.
• Most of COMESA’s members are also members of the
WTO, 13 out of the 19 are members of the WTO and 4
others are seeking to accede to the body
• COMESA assists its members to prepare positions in
negotiations in the WTO. For example, COMESA
secured funds and supervised studies on national
assessments of the situation in the services sectors of
the member states. The results from this will be used to
determine which service sectors to negotiate under the
GATS.
COMESA and the Economic
Partnership Agreements
• 16 of COMESA’s members came together
to form the Eastern and Southern Africa
(ESA) group for purposes of negotiating
with the EU on trade relations post 2007.
• The ESA has with one voice emphasised
the development aspect in their relations
with the EU.
COMESA and the AGOA process
• More than half of COMESA’s members
have been declared eligible for AGOA by
the US government.
• COMESA interfaces with US authorities to
have the extension of AGOA benefits and
to mention some the AGOA aspects that
tend to limit the countries from enjoying
the benefits to the attention of the US
authorities.
KEY LESSONS
• Some policies and trade facilitation focused on large
firms when in some countries focus should be on small
scale firms and cross-border traders.
• United voice to speak to other trading partners, EU,
WTO and AGOA
• Some of trade facilitation programmes developed without
pvt sector involvement, now pvt sector more involved
• Rules of origin tend to constrain rather than promoting
trade.
• Large group of countries with multiple membership – no
problem but sometimes tends to dilute commitment to
the integration process.