Best Practices in Regional Integration in Africa

8th Session of the Committee on Trade, Regional Cooperation and Integration6 - 8 February 2013Addis Ababa, Ethiopia

George M. Mugabe

UNECA-RITD

Regional integration: a key strategy for advancing Africa’s socio-economic endeavors.

There is increased level of political will and commitment to establishing the AEC

Bottlenecks still hamper progress towards realizing the AEC

Introduction

Any notable progress?

Some best practices in regional integration in RECs are making the

difference worth noting

Some best practices in regional integration in RECs are making the

difference worth notingNotable progress in

RECs where some best

practices have been put in

place

Elimination of tariffs Under COMESA FTA,

participating countries are now a zero tariff zone

85% of the total regional trade is from within the FTA

EAC member States are a duty- and quota-free trade regime (0% Tariff) since 2010

Trade has strengthened to over $ 2 billion since then

Trade and Market Integration

Total exports within the EAC region are now running a close second to total EAC exports to the euro area (Trademark Southern Africa)

Values in US $ Millions

UNCTAD, 2011

Elimination of NTBs COMESA, EAC and SADC are implementing an

“ORM”

Trade and Market Integration

Rwanda now has zero checkpoints from Rusumo border to Kigali

Some Best ExamplesSome Best Examples

An

y Progress M

ade?

An

y Progress M

ade?

Rules of Origin Certificates

COMESA is using a regional Rules of Origin (RoO) certificate.

It entitles cross-border traders to preferential trade under FTA.

Harmonized formulae for RoO.

Rules of Origin

The Chirundu One Stop Border Post (OSBP)

Savings in time values as high as US $ 600,000/day

Clearing time has reduced from 3 days, to 6 hours and 1 day maximum.

Trade Facilitation Measures

More Examples?

COMESA CD is used as standardized document for customs transit traffic control.

The document caters for imports, exports, transit and warehousing

It said to have replaced on average 32 documents in some member States

Trade Facilitation Measures

Simplification of documentation at customs check points: Cutting down Red Tape

Relaxation of visa requirements

COMESA is granting a 90-day visa upon arrival to all FTA members.

The same is true within ECOWAS.

Free Movement of People

Visa requirements are stringent

in Africa

Visa requirements are stringent

in Africa Rwanda, as of January 1, 2013, is issuing visa on arrival for all African nationals.

Rwanda, as of January 1, 2013, is issuing visa on arrival for all African nationals.

Travelling regionally and internationally is easy with ECOWAS regional Passport.

Expected to replace the national passports used by other member States.

CEMAC is also using a regional passport “CEMAC Passport”

Free Movement of People

Use of Regional Passports

Under the principle of reciprocity in AMU, Mauritania guarantees;

Freedom of establishment and capital investment,

Freedom to transfer foreign capital,

The ability to transfer the professional income of foreign employees and

Equal treatment of Mauritanians and foreign individuals, as well as of legal entities.

Right of Establishment

COMESA is using the harmonized axle load limit to safeguard the roads against overloading.

Transport and Communication

200 km of 240 km of Arusha-Namanga-Athi River Road is complete

Use of the Harmonized Consumer Price Index (HCPI) as a mechanism to harmonize inflation rate

COMESA is implementing the HCPI

Its based on a harmonized methodology and conceptual approaches across COMESA

SADC is also implementing its HCPI and reported and gazetted on monthly basis

Macroeconomic Convergence

Institutional Monitoring Mechanisms for macroeconomic convergence integration

ECOWAS has set up an institutional framework for multilateral surveillance

It works closely with;

The West African Monetary Agency (WAMA), and

WAMI to promote the establishment of a second West African Monetary Zone (WAMZ)

Macroeconomic Convergence

Payment Systems

Launched in 2007

It has over 10 million subscribers and

Over 2 million daily transactions

Over $ 415 million per month in P2P transactions in Kenya alone.

One-quarter of Kenya’s GDP flows through the mobile payment system.

Contributes annually to roughly 17 per cent of Kenyan GDP.

Way F

orward

Recommend best practices be identified, reported on and shared at country, REC, and even continental level

Although bilateral agreements help to initiate momentum, but for RI initiatives to achieve the intended purposes, encourage agreements through multilateral arrangements