Davies provides recipe to stimulate intra-Africa trade

With almost 29% of South

Africa’s merchandise

exports in 2015 sold in

other African countries, the

African market is extremely

important for South African

producers, particularly

for those producing valueadded

products, according

to the

Minister of

Trade and

Industry, Dr

Rob Davies.

Delivering

his address

in parliament

last week

during the

State of

the Nation

debate, he

said his

department had established

a new division in the dti

called Invest and Trade

Africa.

“The new division will

look at ways in which

investment-led trade

can move us into new

supplier arrangements as

we cooperate with other

countries to promote

developmental integration.”

Davies commented.

He said as part of

president Zuma’s plan

for “radical economic

transformation”, South

Africa needed to integrate

its trade strategies and

policies across existing

regional

communities.

“Practically,

this means

taking steps

to enlarge

the free

trade areas

existing in

the Southern

African

Development

Community

(SADC) and

other regional economic

communities into larger,

more expansive free

trade agreements (FTAs),”

explained Davies, adding

that collaboration on

infrastructure development

was also key.

He suggested that

South Africa follow the

example of successful

emerging economies,

such as India and

China, which

are now turning

to building

their domestic

markets as the

basis to expand

their productive

capabilities and

move up the value

chain.

“The problem we have

in emulating them is

that colonialism divided

Africa into 54 separate

countries, none of which

on its own has a population

or market to support deep

industrialisation. However,

as large groupings we do

begin to reach the numbers

that can support the

growth of new regional

value chains,” said Davies.

“Our overriding priority is

to work to promote African

regional integration.”

He pointed out that, once

concluded, the Tripartite

SADC-Comesa-East

African community FTA

would create a market of 26

countries with a population

of 625 million and a

combined gross domestic

product (GDP) of US$1.6

trillion.

Furthermore, said Davis,

the Continental Free Trade

Area negotiations that

are under way will create

a market of over 1 billion

people and a combined

GDP of over US$2 trillion.

“These integration

processes will put the

African continent on a

sustainable development

trajectory,” he said.

INSERT AND CAPTION

Our overriding

priority is to work

to promote African

regional integration.

–Rob Davies