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Business Writer
ZIMBABWE’S private sector should use the African Trade Observatory to gather market intelligence and boost trade riding on the operationalisation of the African Continental Free Trade Area (AfCFTA).
The AfCFTA to which Zimbabwe is signatory, was operationalised on January 1 this year, making historic stride towards continental economic integration.
Zimbabwe has deposited its instrument of ratification, which is expected to pave way for the country’s full participation in the estimated massive US$3,4 trillion bloc and continent-wide market of about 1,3 billion people.
Speaking during the AfCFTA webinar organised by the country’s national trade development and promotion agency, ZimTrade on Tuesday, the African Union (AU) Commission senior customs expert and advisor at the AfCFTA Willie Shumba said:
“The AU Commission has established what is called the African Trade Observatory, its a market intelligence system which tells you of the various opportunities and products which other countries might have or have interest in.
“The AfCFTA is saying those who want to take advantage of the trade and economic opportunities within Africa now need to look beyond their traditional markets such as Comesa, EAC and Sadc countries.
“The African Trade Observatory is a market intelligence system that the Zimbabwe private sector should make use of to secure market niches across the continent.”
Recently, it has been noted that the projected impact of the AfCFTA on the national economy cannot be over- emphasised and thus the continental free-trade area is a significant milestone towards improving Zimbabwe’s exports into the rest of the region.
Shumba said local companies need to look beyond the countries that Zimbabwe has been trading with since the 1960s and 1980s.
By making strides towards ratification of the AfCFTA, he said this entails that the Government has created a platform for the private sector to look at trading with 54 other countries on the continent.
“Government has created a regime for you (private sector) to now look at the 54 other countries on the continent. What this basically means is you now need your market intelligence. You might think that you have nothing to do with Mali, nothing to do with Sierra Leone and nothing to do with Cote d Ivoire, but if you do your market intelligence you might get a niche for your product in that country,” said Shumba.
He said in this context the Zimbabwe private sector needs to embark on a strong market intelligence taking advantage of the Second Republic’s economic and trade diplomacy.
“The AfCFTA focuses on the continent and it is a stage towards the establishment of the African economic community and right now the private sector should take advantage of the new dispensation’s emphasis on economic and trade diplomacy.
“So, it’s an opportunity here for your national agencies to co-operate with relevant Government departments to make sure that we take advantage of the opportunities that are there and reap the benefits,” said Shumba.
Under the AfCFTA member States are required to have 90 percent of their tariff lines liberalised
(duty-free) and this means, he said every country on the continent is expected to advise the whole of Africa of their tariff offers.
“So far, 41 countries have submitted their tariff offers and Zimbabwe is among those that have not submitted their tariff offers.
“I believe this is a process which is underway.”
Among those that have submitted their tariff offers are Namibia, Botswana, the Democratic Republic of Congo, Swaziland, Zambia, Malawi, Lesotho, Cameroon, Burundi, Kenya and Benin.
Shumba said Zimbabwe has made a commitment that 90 percent of its tariffs would be duty-free and this will be phased down over a five-year period.
“Having 90 percent of the tariff lines going to be liberalised, this will affect revenue figures especially if your trade was mainly with Africa.
“Even when your trade was not with Africa, for example, the importation of fuel from the Middle East, importers might divert from traditional suppliers and source it from countries in Central Africa or West Africa,” he said.
Meanwhile, Mr Shumba indicated that studies have shown that Africa’s role in the global trade market has been that of providing raw commodities in exchange of manufactured goods and thus capturing 3 percent of the world trade.
“In addition, intra-Africa trade is just 15 percent of its total trade, compared with 19 percent intra-regional trade in Latin America, 51 percent in Asia, 54 percent in North America and 70 percent in Europe,” he said.
He said the low level of Intra-Africa trade can change if Africa effectively addresses supply side constraints and weak productive capacity, infrastructure bottlenecks, and access to finance for traders, among other issues.
The main objectives of the AfCFTA are to create a single market for goods and services, facilitate the movement of persons, promote industrial development, sustainable and inclusive socio-economic growth.
The deal is also set to help resolve the issue of multiple membership, in accordance with agenda 2063, laying a solid foundation for the establishment, in future, of a continental common market
Online Reporter