South and East Africa trade deal empty without security protocol - experts

Trade facilitators and experts in Africa have cautiously welcomed the recently signed Tripartite Free Trade Area (TFTA) that brings together three trading blocs in East and Southern Africa, saying it is meaningless without a security protocol. 

According to experts from TradeMark East Africa and East Africa Business Community (EABC), although the inter-regional deal that came into force on July 25 has an Annex on cooperation on trade and customs matters and general infrastructure, there is none on security. 

In a statement, the trade facilitators said a security pact would enhance other integration aspects by erasing existing suspicion amongst some member states. 

"There is a strong link between security and trade so, in the future, TFTA members may need to negotiate a protocol on security whose implementation will be challenging considering the large membership."

"Despite the challenges, we remain optimistic that the deal will achieve desired objectives."

Creck Buyonge Mirito, an international customs and international trade policy, reform, and modernization expert says that trying to ensure that the 26 countries expected in the TFTA are reading from the same script is a tall order – but it can and must be done if security matters are addressed. 

In his report dubbed 'Prospects for Africa’s Tripartite Free Trade Agreement in the Light of lessons learned from the East African Community', Mirito says countering the terrorist threat requires cooperation between governments at the bilateral, regional and global levels.

"Such cooperation includes exchanging intelligence, common training, and capacity building."

He adds that political challenge is also another threat to the pact. 

The pact which has been in the works since 2015  brings together three of Africa’s major regional economic communities—the Southern African Development Community (SADC), the East African Community (EAC), and the Common Market for Eastern and Southern Africa (Comesa).

Based on three main pillars of market integration including trade liberalisation, infrastructure development and industrial development seeks to improve trade within the continent which is currently at a paltry 20 percent. 

The trade deal is set to eliminate tariffs on 100 percent of goods, stimulating economic growth, industrialisation, and sustainable development.

It will fast-track a free trade area and arrangements for the movement of business persons; focus on enhancing connectivity and reducing business costs; and create a supportive environment by improving regulatory and legal frameworks.

It intends to add value, diversify industries, increase productivity and competitiveness, and implement programmes for structural change.

Over the last few decades, several initiatives to boost intra-regional trade have been undertaken by the three regional economic communities that are now coalescing to form the TFTA. 

The launch of the TFTA was the culmination of a process that started in 2008 with the first tripartite summit held in Kampala, Uganda.

Last Thursday, Angola came on board, leading to the much-needed ratification by 14 members. The agreement shall remain open for accession by other member states of the African Union. 

The 26 countries have a combined population of 632 million people or 57 percent of Africa’s population, and a gross domestic product (GDP) of $1.3 trillion (Sh169 trillion). 

Over that period, the share of intra-regional trade in total exports has increased from seven percent to 25 percent. 

While these shares are low compared to European (70 percent) or Asian (50 percent) standards, the trend, according to TradeMark suggests that trade among the tripartite members grew faster than their trade with the rest of the world.

Regional officials believe that the TFTA could accelerate this trend by further stimulating intra-regional trade.

The pact is considered by regional policymakers and some analysts to be a big deal and potentially a game changer for the African trading system and the more than half a billion citizens of the member states.

"Indeed, the deal is expected to be the launching pad for the establishment of the even more ambitious Continental Free Trade Area that is expected to cover all of Africa,'' Brookings says in its latest analysis of the pact. 

According to the report, the coming into force has demonstrated the possibility of collective action among 26 very heterogeneous nations with GDP per capita ranging from $16,000 (Sh2.08 million)to $270 (Sh35,100) and shows the feasibility of harmonizing three very different preferential trade regimes into one unified scheme.