Analysis: GODFRIDAH CHANDA
THE Tripartite Free Trade Area (TFTA) is the brainchild of the heads of state and government from the three Regional Economic Communities (RECs), that is: Common Market for Eastern and Southern Africa (COMESA), Southern African Development Community (SADC) and East African Community (EAC). The heads of state and government, during their meeting which was held in Kampala, Uganda, in October 2008, decided to establish a tripartite free trade area aimed at harmonising trade arrangements in order to find a lasting solution to challenges associated with multiple and overlapping membership of states in the RECS.
The vision was to see member countries of the RECS work together towards the creation of an expanded market through the establishment of a Tripartite Grand Free Trade Area as well as the harmonisation of the infrastructure programmes and development of common programmes for industrial and economic development and facilitation of free movement of people. In a nutshell, the TFTA’s aim is to bring together, in one common market, countries in the three regional economic blocs: COMESA, EAC and SADC.
As such, the heads of state and government for COMESA, EAC and SADC met on June 10, 2015 in Sharm El Sheikh, Egypt, at the Third Tripartite Summit, to officially launch the COMESA-EAC-SADC Tripartite Free Trade Area (TFTA). Zambia was the 17th country to sign the TFTA Agreement on June 17, 2016. However, the country has not yet ratified the TFTA.
The TFTA aims at liberalising 100 percent of tariff lines, taking into account the usual general, specific and security exceptions. Therefore, TFTA is expected to grant Member States, Zambia inclusive, market access and create the largest free trade zone on the continent with a large market of a population of more than 700 million people from a membership of 27 countries within COMESA, EAC and SADC with a combined gross domestic product (GDP) of more than US$1.4 trillion. Additionally, the TFTA region accounts for almost half of the African Union membership and about 60 percent of the African continent’s GDP. This will ultimately represent a large supply of young, dynamic and potentially productive labour force members.
Moreover, Zambian exporters will be accorded an opportunity to competitively grow their international market. At the same time, the market will open up for more competition from the region. As such, this will ultimately boost trade as a result of market expansion and contribute to the African Union Agenda of boosting intra-Africa trade. If properly harnessed, this abundance of customers and workers could attract a substantial amount of domestic and foreign investment, which in turn could boost economic growth, employment creation and wealth generation across the region.
On the other hand, if Zambia decides not to ratify the TFTA and continue to utilise the existing Free Trade Agreements such as COMESA and SADC, this would entail that Zambia will have multiple preferential trade arrangements, and subjected to different rules of origin requirements contrary to the spirit in which the TFTA was established for.
That notwithstanding, Government will continue implementing measures aimed at promoting value addition and improving the competitiveness of the country so that local industry can take full advantage of the market access being provided through the TFTA.
However, it is worth noting that the Agreement will become operational once fourteen (14) Member States/Partners ratify it. So far, only 23 countries have signed the Agreement, out of which only four (4) have ratified it. It is for this reason that the Tripartite Committee of Senior Officials Meeting held on February 3, 2018 in Addis Ababa underscored the importance of national stakeholder engagements to facilitate ratification and implementation of the Tripartite Free Trade Area Agreement.
Furthermore, the Seventh Meeting of the Tripartite Sectoral Ministerial Committee for Trade, Custom, Finance, Economic Matters and Internal Affairs held on June 18, 2018, in Cape Town, South Africa, directed its lower organs to complete the outstanding work and negotiations by first quarter of 2019. In light of this, the TSMC also urged Member States to ratify the TFTA Agreement by April 2019 in readiness for the summit that will be held in this month.
It is against this background that Zambia has continued to work towards meeting the stated set dates by holding high level sensitisation meetings on COMESA-EAC-SADC Tripartite Free Trade Area. The first meetings was held in July last year in 2018 with the Members of Parliament as part of the efforts by the Tripartite Task Force to undertake outreach to Member States for the purposes of awareness creation on the TFTA and ratification outlining its objectives, components of the negotiations that are completed and those that are outstanding, all in preparation for possible ratification of the Agreement. These national sensitisation workshops on TFTA were equally held in Malawi, Madagascar, Mauritius and Botswana.
Then there was the second high-level consultative meeting on the COMESA, EAC and SADC TFTA with government ministries and agencies. The objective of this four (4) day technical workshop held in Lusaka was to provide an update on TFTA matters and analyse the implications if Zambia is to ratify the Agreement. The workshop, therefore, reviewed the TFTA Agreement, including all its annexes that have been concluded so far in order to come up with a paper that will highlight the implications and recommendations thereof, on the possible ratification of the TFTA Agreement by Zambia.
In addition, the committee developed a blueprint that was used to further engage the private sector players in order to have their consent and buy-in on this process. For this, the ministry conducted two (2) TFTA consultative workshops for chambers of commerce and industries from the northern and southern region of Zambia in Ndola on April 15, 2019 and in Lusaka on April 18, 2019 respectively. The objectives of these workshops were to sensitise the private sector stakeholders through the regional chambers of commerce and industry on the progress made and possible ratification towards actualising the COMESA-EAC-SADC Tripartite Free Trade Area.
The ministry will continue engaging, consulting and sensitising the various stakeholders on the possible ratification and implication of the TFTA Agreement so as to seek their views based on their experiences in their respective sectors.
The author is public relations officer – Ministry of Commerce, Trade and Industry.
Analysis: GODFRIDAH CHANDA