common market for eastern and southern africa experience of comesa in intra regional trade
DESCRIPTION
COMMON MARKET FOR EASTERN AND SOUTHERN AFRICA Experience of comesa in intra regional tradeTRANSCRIPT
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1958 &1960 - Meetings of independent African States agreed to promote economic co-operation amongst themselves to combat fragmented economies and small market size.
1965 - UNECA ministerial meeting in Lusaka recommended creation of Economic Community of Eastern and Southern African States.
1981 - Treaty establishing PTA signed.
History of PTA and COMESA
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1982 - PTA Treaty, which envisioned its transformation into a Common Market in 10 years, was ratified.
1993 - Treaty establishing COMESA signed.
1994 - COMESA Treaty ratified.
Process of Regional Integration a logical, systematic process from a preferential trade area to a common market to an economic community.
History of COMESA ..cont’d
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COMESA Membership
• Angola
• Burundi
• Comoros
• Congo, DR
• Djibouti
• Egypt
• Eritrea
• Ethiopia
• Kenya
• Madagascar
• Malawi
• Mauritius
• Rwanda
• Seychelles
• Sudan
• Swaziland
• Uganda
• Zambia
• Zimbabwe
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COMESA AT A GLANCE
Total Area 12.8million sq. kmPopulation 370 million (1999 est.)Membership 20 countriesGDP at current prices $180 billion (2002 est.)Total Exports $ 28 billion (2002 est.)Total Imports $ 60 billion (2002 est.)Intra-COMESA trade $ 5.3 billion (2003 est.)External Debt $130 billion (2000 est.)
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Aims and Objectives of COMESA
• To generate self-sustaining economic growth through collective action in all fields of social and economic activity.
• To create a fully integrated and internationally competitive region where goods, services, capital, labour and persons move freely.
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Vision of COMESA
To attain a fully integrated and internationally competitive regional economic community with high standards of living of its people and where goods, services, capital and labour freely move across borders.
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COMESA IN 2018• Single Currency &
Common Central Bank
• Borderless Region
• Free Mobility of Factors of Production
• Common Investment Area
• Single Market for Primary & Secondary Goods
• Air and Ground Transport fully integrated & liberalised
• Common Border Posts
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STRATEGY OF COMESA
• Strategy:- regional integration through trade and investment: creating a single market for goods and services and a common investment area.
• Approach: - open-regionalism i.e. integrating regionally without crowding-out the global economy (the multilateral framework).
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MISSION OF COMESA
• To achieve increased co-operation and integration in all fields of development, particularly:-– in trade, customs and monetary affairs;– in transport, communications and
information;– in technology, industry and energy;– in agriculture, environment, natural
resources; and – Gender development
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COMESA in Continental Context
• COMESA was established under the auspices of Lagos Plan of Action which seeks to establish African Economic Community;
• COMESA is a building block of African Economic Community as is ECOWAs, IOC, SADC and EAC;
• COMESA is the first FTA under the Lagos Plan of Action and so is a test case of African integration.
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COMESA in Global Context
• COMESA is notified to WTO as a Regional Trading Arrangement (RTA);
• COMESA FTA is compatible with WTO Enabling Clause and Article XXIV on regional groupings.
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Common Market 2014
Economic Community 2025
Political Union
Preferential Trade Area (PTA) 1984
Same tariff on non m/States
Free Trade Area 2000
African Union
Customs Union 2004
Free Trade among m/State
FTA among COMESA states and CET
All attributes of Customs Union ++ Free movement of factors of production
Tariffs among m/States reduced – not eliminated
Free Trade with EU in 2020
All attributes of CM ++ Single Currency ++ Unified Econ Policies
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COMESA PROGRAMMES
Trade Liberalisation
The main objective of the trade liberalisation programme is to create a single economic space in which there is free movement of goods, services, capital & labour. Instruments used include:
Tariff ReductionRemoval of Non-Tariff Barriers to TradeRules of Origin
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Trade Development and Promotion Programme
Elements:
•Supply and Demand Surveys•Buyers/ Sellers meetings•Enterprise-specific assistance•Trade Fairs and marketing missions•Strengthening individual chambers of commerce•Trade Information Network (TINET)•Seminars on “ Doing Business in COMESA”•Analysis of production and investment opportunities
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COMESA FREE TRADE AREA (FTA)
Tariff Reduction commenced on 1st July, 1984
Original Target Date for FTA September, 1992
Target Date for FTA postponed to October, 2000
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COMESA Members in the FTA
• The COMESA FTA was launched on 31st October 2000.
• COMESA Member States participating in the FTA are:
BurundiDjiboutiEgyptKenyaMadagascarMalawi
BurundiDjiboutiEgyptKenyaMadagascarMalawi
MauritiusRwandaSudanZambiaZimbabwe
MauritiusRwandaSudanZambiaZimbabwe
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Zero tariffs on goods from COMESA Countries.
Goods from non-COMESA dutiable at full national tariff rates.
No NTBs on COMESA goods.
Application of COMESA Rules of Origin.
ELEMENTS OF COMESA FTA
3
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Direct consignment from exporter to importer and
35% local value added, ex-factory cost; or 25% local value added, ex-factory cost for
goods of particular economic importance; or
change in tariff classification; or 60% cif value of imported
materials; or Wholly produced goods.
Provisions of COMESA Rules of Origin:
4
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COMESA CDCOMESA Customs Bond GuaranteeASYCUDA/EUROTRACEHarmonised System Code Common Tariff NomenclatureCommon Statistical RulesYellow Card Motor Vehicle InsuranceHarmonised Road Transit ChargesCarriers LicenseOverload ControlsMaximum Vehicle DimensionsACIS for Cargo tracking
Trade Facilitation:
5
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Monetary Co-operation
Objective:
To establish a monetary union so as to have a zone of monetary stability in order to facilitate the integration efforts:
Phased Monetary and Fiscal Policies Harmonisation Programme towards a common currency issued by a common central bank in 2025.
Regional Payments System; Africa commerce exchange.
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Up-dating of information on trade and investment laws in COMESA;
Harmonising investment codes;
Developing Investor Roadmaps
Providing information on investment opportunities
Developing and promoting COMESA as a Common Investment Area;
Promoting development growth poles.
Investment Promotion
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A. Air Transport Programme
(1) Liberalisation of Air Transport Services
(2) Air Transport Facilitation
(3) Safe Skies Programme (CNS/ATM System)
B. Road Transport and Traffic Facilitation
C. Telecommunications Interconnectivity
Transport and communications
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COMESA INSTITUTIONS
PTA Trade and Development Bank COMESA Clearing House COMESA Court of Justice The COMESA Re-Insurance Company
(ZEP-RE) COMESA Bankers Association to
promote links among banks Africa Trade Insurance Agency offers
political risk guarantee Leather and Leather Products Institute
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SECTOR BASED INSTITUTIONS
METTALUGICAL INDUSTRIES (COMESAMIA)
THE YELLOW CARD INSURANCE. BUREAU
WOMEN IN BUSINESS (FEMCOM)
PHARMACEUTICAL ASSOCIATION
COMESA BUSINESS COUNCIL
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Intra-COMESA trade has increased from
US$ 734 Million in 1985 to US$ 5.5 billion in
2003;
Transport facilitation measures has cut
transport costs by approximately 25%.
Supply/demand surveys carried out, and
buyer/seller meetings & trade fairs
organised have generated transactions
worth about US $ 1 billion
Results of Integration
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COMESA has re-defined its medium-term strategy as being the promotion of regional integration through trade and investment;
COMESA is now concentrating its efforts on consolidating and expanding the FTA and establishing a Customs Union, while accelerating investment promotion.
Conclusion: Where we are going ?
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THANK YOU FOR YOUR ATTENTION
THE END
Internet Site: http://www.comesa.int