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May 11, 2012

Low-hanging fruit

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Dar Es Salaam|Doha|DURBAN|Africa|African Development Bank|Environment|Industrial|Risk Management|Systems|Africa|Qatar|South Africa|Zambia|Zimbabwe|USD|Products|Systems|Walvis Bay|Infrastructure|Mthuli Ncube|Rob Davies
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Speaking at the recent United NationS Conference on Trade and Development conference, in Doha, Qatar, South Africa’s Trade and Industry Minister, Dr Rob Davies, again emphasised the need to promote “development integration” across Africa by combining market integration with programmes for infrastructure development.

The latest version of the South African government’s Industrial Policy Action Plan also highlights how further regional integration is key to meeting South Africa’s industrial policy aspirations.

Development integration itself is premised on a growing awareness that trade barriers do not represent the main impediment to raising Africa’s intraregional trade and investment levels. Instead, the key constraints relate to weak physical infrastructure linkages that decrease the opportunity for trade in complementary value-added products.

It is also widely accepted that border posts and checkpoints are a key bottleneck, a point reaffirmed in a recent paper by African Development Bank chief economist Professor Mthuli Ncube.

The paper shows that trade liberalisation efforts have helped to raise the volume of trade within the Southern African region from $12.4-billion in 2000 to $34.5-billion in 2010, after peaking at $36-billion in 2008.

However, the large number of border posts and roadblocks along the key corridors (Dar es Salaam, Walvis Bay, Beira and the north–south corridor through Durban), together with inefficiency of procedures, are costly to traders. “For instance, traders/trucks have to wait about 36 hours at the South Africa-Zimbabwe border post (Beitbridge),” Ncube laments, adding that customs delays in the territory are costing the region about $48-million a year.

“The customs environment in the regional grouping is characterised by a lack of coordination among the multiple government agencies on both sides of the border. This raises the common challenge of the duplication of procedures at each border, which increases the potential for risk management and fraud.” There is also a lack of computerised customs management systems, while such systems are not compatible when they do in fact exist.

The solution, the paper states, lies in one-stop border posts, whereby people and products make a single stop and pass through simplified and harmonised customs and immigration procedures. “One-stop border posts do not only facilitate the movement of goods and persons by reducing the bureaucracy and clearance times at the borders, they also enhance trade by reducing the high cost of trading emanating from delays, bribes, and cumbersome procedures at border posts.”

Ncube concludes by making the case for a one-stop solution at Beitbridge, while highlighting the gains that have been made at the Chirundu one-stop border post between Zambia and Zimbabwe.

I couldn’t agree more and hope that such a solution is rolled out soon and not only at Beitbridge, but also across the Southern African region.

Edited by: Terence Creamer
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