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In Brief:
Creating a Single Continental Market for Goods and Services, with Free Movement of Businessmen and Investments, that Will Pave the Way for Acceleration and Expansion creation of the Continental Customs Union and the African Customs Union.
Strengthen competitiveness at the industry and enterprise level by exploiting opportunities for large scale production, continental market access and better reallocation of resources.
Desie Heita
WINDHOEK – The Revolutionary Decision of Namibia to Put the Pen on Paper. African Continental Free Trade Area (AfCTA), signed by President Hage Gein The AfCFTA, cast in the image of the free trade regime of the European Union, has been hailed as a breakthrough of economic integration by his supporters, while the critics and protagonists of the Inker had barely dried up the deal when Geingob, during the landing at the airport of Eros to Windhoek of the AU meeting, expressed some fears about the AfCFTA
According to the news agency Nampa Geingob, perhaps, has expressed concern about the 0.2% levy on imports that Namibia has to pay to the AU under the FTA, which would bring the payment of Namibia to the AU to 53.9 million. Namibian dollars against N $ 26.9 million. We also recorded how we like to get things done, like the 0.2 percent on imports. We told them we are a small open country. We just decide things, but when you look at the details, you can see that there are mistakes, "said the Geingob agency.
This naturally raises the question of what Namibia agreed to do, after
initially silly with South Africa and Nigeria, the two largest economies of the continent in the southern and western regions?
What is security Namibian beef, pasta, fish and lager beer? To begin with, Namibia's meat and pasta are safe because they have been classified as sensitive items, under the categorization clause special products of the agreement that permanently exempts the products of Namibia.The sensitive products of liberalization, say Wallie Roux, renowned researcher and commercial analyst.
"Namibia will benefit from # 39; Aleff? The answer for the short term is probably no, "opines Roux. According to its assessment, the main reason Namibia signed the agreement is that the country is part of the Southern African Customs Union (SACU) and the Southern African Development Community (SACU). Southern Africa (SADC)
. physical and industrial infrastructures such as South Africa are better placed to benefit from the expected benefits of the FTA and AfCFTA.
"Namibia's benefits in this regard would most likely be indirect, with the exception of a few potential export markets". However, Namibia's logistics sector could benefit enormously from the fact that there is no need for it. strategic location of the country and its already developed corridors to neighboring countries, "he said.
Namibia under SACU, negotiated AfCFTA under the auspices of SADC, and Roux said In practical terms it is SACU who led the negotiations on behalf of SADC.
"I do not have the final text with me, but suffice it to say that SACU does not have the text. has nothing negotiated outside the text of its own agreement, infant industry protection is not directly part of a trade regime between countries – which means that it is still covered by the SACU Agreement, " says Roux
Academics and economists with a superior understanding of Opportunities pointed out that on paper AfCFTA presents a huge opportunity through which African countries would be in a market valued at nearly US $ 4 trillion (about N $ 50.6 billion) without commercial restrictions such as tariffs. Rwandan President Paul Kagame has been lyrical about how the deal would bring "prosperity for all Africans, as we prioritize the production of value-added goods and services made in Africa".
Hypothetically, from a statistical point of view If Namibia sold to the AU goods valued at 0.2% under the agreement, the Minister of Finance, Calle Schlettwein, would be forced to buy for departmental finance officials scientific calculators exceeding the standard 12-digit capacity.
This is the only way to calculate the revenues of over 113 billion Namibian dollars – nearly double our expenditures for this year, for which we have to borrow billions of dollars to offset the massive decline – The value of trillions of dollars of trade with Africa.
But the criticism is that the removal of tariffs would deprive governments of much-needed revenues from national development programs. According to an UNCTAD research paper, African governments are expected to lose up to 53 billion Namibian dollars each year during the early years of AfCFTA implementation, by removing tariffs on close to 90 percent of the goods they would market. As a member of SACU, all import duties of SACU Member States are grouped and then administered by South Africa and distributed to Member States according to the revenue-sharing formula – including a revision final is under discussion among SACU Member States, with some objections from some members such as Namibia.
The effects of AfCFTA for Namibia and its siblings in the SACU family will likely be a decrease in income during the first years of ALEFF's implementation, opine Roux. "Potentially the SACU import rights pool could shrink due to the removal of tariffs." However, given the fact that SACU's offer in the SADC FTA counts more of 90% of zero duty tariff lines (excluding taxes), the removal of tariffs in the AfCFTA would not have a major impact on the SACU pool in the short term. the main reason is that SACU itself is almost self-sufficient in its own demand, "explains Roux.
"If trade between AfCFTA countries increases, which is one of AfCFTA's goals, could boost local economies." One of the concerns is that the trade agreement could flood the Namibian market with substandard products from countries where quality standards are not being met.For the fear of poor quality products entering Namibia can also be countered by the fact that, under SACU, all imports into SACU Member States are controlled by the same quality standards and their requirements such as labeling, as it would be unwise for a country to To lower its existing quality standards.In addition, to refer to beef standards, for example, Namibia would not allow imports of beef from any country belonging to the country. not to SACU under veterinary standards. Namibia adheres to and adheres to the veterinary standards of the European Union and the United States of America, "says Roux.
The challenge for Africa is now to know whether large-scale projects AfCFTA deployment will come true or not.
And that's something that Geingob himself alluded to when he got off the plane from the meeting of the AFCFTA. UA in Mauritius
"We have signed the Continental Trade Agreement but we have reservations. Trade area. We are asking Nampa to implement the tripartite free trade area, Geingob said.
Mr. Roux points out that AfCFTA is a key element of the ambitious long-term development plan of the African Union. Africa is renowned for its ambitious plans, especially with respect to its trade agreement regimes. The only one that is really functional on our continent is the SACU agreement, with COMESA, ECOWAS and SADC fighting for a second and third place away. Therefore, sign and maybe ratify, the agreement is one thing; "The real challenge is to fully implement it," says Roux.
To date, 49 out of 55 African countries have signed the trade agreement and now have to be formally ratified by 22 signatory countries prior to its entry into force. . In Namibia, it is now expected that Geingob will agree to the Cabinet before Trade Minister Tjekero Tweya deposits it in the National Assembly for adoption and ratification.
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