SADC must redress trade imbalances

JOHANNESBURG – South African President Thabo Mbeki said on Friday that plans for a regional free-trade zone of 14 countries by 2008 highlighted a need to reverse huge trade imbalance within the bloc.

Mbeki said that trade flows within the Southern African Development Community (SADC) were hugely tipped in favour of South Africa, the continent’s economic powerhouse. “Currently available figures indicate that in the six or so years up to 2003, intra-regional SADC trade increased from 20 per cent to 25 per cent of total regional trade,” Mbeki said in a weekly newsletter.”All indications suggest that much of it continues to be made up of exports of manufactured goods from South Africa to the rest of the region, with a much smaller volume of imports into our country from the rest of the region.”It cannot be fundamentally because of tariffs.This is because our country has …already removed duties on over 90 per cent of goods originating from SADC countries,” he said.Mbeki said the other members of SADC were saddled with “underdeveloped production capacity and inadequate infrastructure”, adding that this would have to be tackled to ensure that the booming South African economy “does not serve further to entrench the underdevelopment of the other SADC member states.”SADC, which has set itself ambitious targets for the next 12 years, including an agreement to scrap tariffs on 85 per cent of all goods by 2008, reviewed progress on achieving the free-trade zone target of 2008 at a meeting in South Africa this week.It plans to have a customs union by 2010, a common market by 2015 and a common currency by 2018.The bloc groups Angola, Botswana, the Democratic Republic of Congo, Lesotho, Madagascar, Malawi, Mauritius, Mozambique, Namibia, South Africa, Swaziland, Tanzania, Zambia and Zimbabwe.Nampa-AFP”Currently available figures indicate that in the six or so years up to 2003, intra-regional SADC trade increased from 20 per cent to 25 per cent of total regional trade,” Mbeki said in a weekly newsletter.”All indications suggest that much of it continues to be made up of exports of manufactured goods from South Africa to the rest of the region, with a much smaller volume of imports into our country from the rest of the region.”It cannot be fundamentally because of tariffs.This is because our country has …already removed duties on over 90 per cent of goods originating from SADC countries,” he said.Mbeki said the other members of SADC were saddled with “underdeveloped production capacity and inadequate infrastructure”, adding that this would have to be tackled to ensure that the booming South African economy “does not serve further to entrench the underdevelopment of the other SADC member states.”SADC, which has set itself ambitious targets for the next 12 years, including an agreement to scrap tariffs on 85 per cent of all goods by 2008, reviewed progress on achieving the free-trade zone target of 2008 at a meeting in South Africa this week.It plans to have a customs union by 2010, a common market by 2015 and a common currency by 2018.The bloc groups Angola, Botswana, the Democratic Republic of Congo, Lesotho, Madagascar, Malawi, Mauritius, Mozambique, Namibia, South Africa, Swaziland, Tanzania, Zambia and Zimbabwe.Nampa-AFP