Vusumuzi Dube
Judith Phiri, Business Reporter
RETOOLING for businesses has been identified as key in improving capacity utilisation enabling businesses to be competitive in the African Continental Free Trade Agreement (AfCFTA).
AfCFTA is an ambitious undertaking that brings together 1,3 billion people in 55 African countries to create the world’s largest free trade area as measured by the number of participating member States.
On final conclusion and implementation, its objective is the creation of an integrated market for the trade in goods and services and the free movement of people and capital.
In an interview, Zimbabwe National Chamber of Commerce (ZNCC) Matabeleland chapter vice-president, Mr Louis Herbst told Sunday News Business that in order to be competitive on the continent, businesses should look at the practicality of the situation.
“Retooling, foreign investment, transportation and power to mention just a few must be handled diligently in order to create a level playing field for not only Zimbabwe but all landlocked and sanctioned countries to be able to fully embrace the AfCFTA,” said Mr Herbst.
He said exporting and importing whilst trying to remain competitive becomes a challenge with some of the neighbouring countries, as transportation logistics of inter-Africa trade networks be it road, rail or air must be looked at.
Mr Herbst said there was a need to also ascertain how to best connect the routes in a cost-effective manner as competitiveness could be easily lost in the transport costs.
“Additionally, we have to look at modernisation and retooling of industry, I would hope that as part of AfCFTA, financial packages or favourable trade tariffs will be made available to countries requiring funding for retooling for the sake of competitiveness,” he added.
He said ZNCC together with relevant Ministries and ZimTrade they have been playing an active role in educating all industry sectors on the potential and the opportunities availed through the AfCFTA agreement.
Mr Herbst said they have also highlighted measures that need to be adopted in order for local organisations to play an active role and be a part of the African trade arrangement.
“I trust that there will be the implementation of a national registered database and web-portal that would allow for all industry sectors to be registered on and continental access to this portal will be available.
I do believe it will take time to implement and for the full value of this intercontinental trade to be appreciated, while the end result will be of AfCFTA enabling free trade between geographically close countries in the continent,” he said.
He said it will lead to lower prices, increased export potential, higher growth, economies of scale and greater competition, as manufacturing was critical for overall economic development and poverty alleviation in Africa.
While, he said the AfCFTA must consider what measures will be put in place for sanctioned African countries such as Zimbabwe.
Economic commentator and businessman Mr Morris Mpala said the cost of doing business for local companies could be a hindrance to their competitiveness against other countries.
Online Reporter