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African Free Trade Area kicks off, but with reminders of major obstacles at borders

African Free Trade Area kicks off, but with reminders of major obstacles at borders

Photo by Creamer Media

4th January 2021

By: News24Wire

  

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It was by coincidence rather than design that the African market got bigger on the same day that Europe shrunk.

Britain exited the EU on the first day of this year, just as African countries started trading under the African Continental Free Trade Agreement (AfCFTA). This agreement is set to create a tariff-free, single market for all of Africa's 1.27-billion people. 

Implementation of the free trade agreement had to be postponed by six months due to delays related to Covid-19 lockdowns, which saw closed borders and travel restrictions. But there are other issues, too, that could threaten the success of this treaty.  

Less than a month before the agreement went live, there was a major snarl-up at the Beitbridge border post, leaving freight trucks queuing for kilometres on either side.

In the southern African region, frustrations around border crossings are common.

It was one of the hurdles countries on the continent faced that could completely "remove the shackles of economic deprivation perpetuated by the 34 000km of borders that divide us", as Afreximbank president Benedict Oramah described it during the online event that launched the AfCFTA on New Year's Day.  

Although Home Affairs Minister Aaron Motsoaledi this week blamed the delays on Botswana's strict Covid-19 protocols, which forced freight traffic to divert from the Groblersbrug crossing through Botswana to Beitbridge, transport associations blamed it on a lack of consultation and proper communication. 

"Government did not consult with industry bodies: it took a unilateral decision to impose stringent Covid-19 testing at the border posts, which resulted in more than 20km queues on both sides of the border," Federation of Eastern and Southern African Road Transport Associations chief executive officer Mike Fitzmaurice said.

"They only took heed of our proposals once the situation became dire." 

TRUCK STOPS 
Even before the pre-Christmas jams, trucks took on average 35 hours to clear the border from the South Africa side and out into Zimbabwe, Fitzmaurice said.

"Other borders like Chirundu [between Zimbabwe and Zambia] and Kasumbalesa [between Zambia and the Democratic Republic of Congo], which were nightmarish in the past, have improved drastically since we put pressure on border authorities to improve efficiency."

He added it was possible to clear these borders within 24 hours or less, depending on traffic volumes.  

Kazangula, between Botswana and Zambia, is still problematic due to delays with the ferry crossing and Covid-19 protocols on both sides and crossings take about 40 hours on average.

A bridge, and one-stop border posts, should have been opened here at the end of last year, but there has been a delay which has possibly been caused by Covid-19 protocols. 

East Africa is some way ahead of southern Africa in easing the flow of freight traffic.

The region had more than 15 one-stop border posts in operation and an established Single Customs Territory Regime with a Regional Bond Scheme which had reduced border crossing times by as much as 80%, Fitzmaurice said - something that is lacking in southern Africa.

It takes between three to six hours to cross such borders, reducing transit times from 18 to around eight days.  

In contrast, southern African border posts were "archaic in design" and date from a time when traffic volumes were low, and most have single lane entry and exit points, said Fitzmaurice.

ICT systems do not have a single window platform where information can be shared with all stakeholders and across borders.

He questioned whether southern Africa had the political will to facilitate changes to make the AfCFTA workable in the region.  

The chairperson of the South African Association of Freight Forwarders (SAAFF), Juanita Maree, said the retail price of a can of cold drink increased by 11.28% for an eight-day delay, and the indirect cost of delays ran into the millions. 

She added action to smooth the flow of traffic through borders like Beitbridge should help make the AfCFTA work.

"The agreement is a phenomenal, once-in-a-lifetime opportunity to bring 30-million people out of extreme poverty and to raise the incomes of 68-million others who live on less than $5.50 per day. 

"Municipalities, government agencies and departments as well as the private sector on both sides of the border need to collaborate to create capacity and efficiencies to ensure that there are no bottlenecks at the border.” 

Maree said trade facilitation measures that "cut red tape, ease movement in a secure environment to simplify customs procedures in the AfCFTA framework will help drive $292-billion of the $450-billion in potential income gains".  

Road Freight Association CEO Gavin Kelly said he hoped the AfCFTA would smooth the transit of goods through countries, like in the EU, by removing the different requirements each country had for goods to pass through. 

He added the clearing of passengers should be away from the border, and "there should only be one point for scanning between two countries".  

Motsoaledi, in an interview in February, promised that Beitbridge would be one of the six one-stop border posts by 2024 planned by his department, and there would be separate lanes for taxis, pedestrians, private vehicles and trucks.  

It is important for South Africa - as well as the rest of the region - to get it right.

South Africa was one of the countries that threw its weight behind the AfCFTA and its implementation is considered one of President Cyril Ramaphosa's legacy projects, as he is the current AU chairperson.

It is also a South African, Wamkele Mene, formerly from the Department of Trade and Industry, who was appointed in February last year by the AU Assembly to be the secretary of the AfCFTA, seated in Accra, Ghana. 

Not much was said about the infrastructure challenges during the launch on Friday.

Mene did, however, emphasise that the AfCFTA should be "an instrument for Africa's development".

According to the World Bank, this agreement, if properly implemented, should see 100-million Africans lifted out of poverty by 2035, he said. The majority would be women.  

Only one out of the AU's 55 member states has not signed the agreement, 33 have ratified it and 40 have submitted their tariff offers.  AU Commission chairperson Moussa Faki Mahamat said the remainder of the negotiations was set to be completed by July.

Edited by News24Wire

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