SACU lines up interventions to support AfCFTA

Africa Continental Free Trade Area ( AfCFTA) can become a catalyst for growth, both at the regional and continental levels with industrialisation as an overarching objective that engenders sustainable development, SADC Parliamentary Forum was told. The bold statement came from the Executive Secretary of Southern African Custom Union ( SACU), Paulina Mbala Elago during a question and answer session at the 49th Plenary Assembly Session of the SADC PF, that was held virtually and hosted by Botswana Parliament. Mbala Elago was a resource person during the Plenary Assembly Symposium on “Leveraging the AfCFTA for Post- COVID Economic Recovery in Southern Africa: The Role of SADC Parliamentary Forum and National Parliaments”.

Elago shared the podium with the likes of AfCFTA Secretary General, Wamkele Mene, SADC Executive Secretary, Dr. Stergomena Lawrence Tax, and Government Chief Negotiator Phazha Butale. Elago stated that Africa’s trade landscape is not impressive, showing that Intra- Africa trade stands 18- 20 percent versus Latin America at 40 percent, Europe’s 70 percent and Asia’s 80 percent. She said there is little trade and scope to expand trade, as well as lack of market integration.

Elago told member states that AfCFTA is a timely policy and a game changer as it offers high priority, in among others, enlarged market of 1.3 billion consumers and 3.4 trillion GDP, enhanced productive capacity and welfare gains $ 16 billion, alignment with SACU objectives of deepening regional integration and industrialisation, as well as enhanced trade and investment opportunities.

Highlighting SACU’s interventions to support the AfCFTA implementation on industrialisation, Elago said that they found trade liberalisation insufficient to maximise gains from trade.

She said that industrialisation is an overarching objective for SACU’s refocused Agenda, which includes but is not limited to industrialisation through regional value chains export promotion; investment, trade facilitation and logistics; AfCFTA, Positioning SACU versus the AfCFTA and SACU agenda based on the SADC Industrialisation Strategy.

On issues of SACU‘ s interventions to support the AfCFTA implementation on industrialisation and Regional Value Chains development, she said the focus priority sectors include; Agro- processing Leather and Leather products, Fruits and Vegetables, Meat and Meat Products, Textiles and Clothing; and Pharmaceuticals and Chemicals.

She mentioned other interventions as stakeholder engagement through Sectoral Roundtables held to identify the developmental potential, investment and export opportunities, Ministerial Investment Roundtable scheduled for third quarter and ultimately long- term Industrialisation Strategy for SACU.

Elago stated that SACU’s Trade Facilitation Programme is realigned to support industrialisation and trade agenda focusing on Customs Cooperation which needs to simplify and harmonise procedures.

She said Trade Facilitation Programme has been realigned to support trade with focus on continued implementation of the Customs Modernisation Programme to strengthen Customs Cooperation and reform processes through IT Connectivity to link and enable the Customs Management Systems of all SACU Member States to automatically share export and import information.

Elago said to date Botswana, eSwatini, Lesotho, and Namibia have linked their Customs Management Systems to South Africa. Next target is to interlink the remaining member states.

Further, the Authorised Economic Operator Programme - a voluntary programme to promote compliance and security of the supply chain- offers benefits for traders such as expedited movement of goods, simplified processes; reduced compliance audits; expedited refunds; and reduced deferment bonds.

There is a total of 151 accredited Authorised Economic Operators across the region, under the SACU Authorised Economic Operators Compliance Programme.

Elago cited potential challenges associated with AfCFTA as homogeneous agricultural production leads to increased competition for SMMEs, surge in imports, dumping, Risk of Trans- shipment and counterfeits, Customs capacity constraints and production capacity constraints could hinder full benefits from the AfCFTA for smaller and less diversified economies.

Talking about the policy considerations and role of parliaments, Elago said there is need to expedite ratification and domestication of the AfCFTA, Diversification of the industrial base and services, Address supply side constraints and skill development, Strengthen customs administration and border coordination as well as ensure a conducive environment for cross border trade, Support SMEs, women, and youth and publicity, awareness and extensive outreach campaigns to promote utilisation and benefits of the Agreement.