Egypt urges COMESA members to join free trade area
By Khaled Diab
CAIRO, May 22, 2001 (Reuters) - Egypt's President Hosni Mubarak opened a summit of a 20-nation African trade bloc on Tuesday with a call for more of its members to join a free trade area.
The Common Market for Eastern and Southern Africa (COMESA), with a combined population of 400 million, is holding its first summit since nine of its members launched a Free Trade Area (FTA) in October. COMESA wants to turn the FTA into a customs union by 2004 and achieve monetary union by 2025.
”I am confident that our success in activating the free trade area will be a good incentive for other member states that are still not part of the FTA to join it quickly,” Mubarak, taking on COMESA's rotating presidency, told the first session.
Mubarak said the free trade area was necessary to enable member countries to cope with globalisation.
“Our summit is taking place at a
time when we are faced with increasing challenges in light of the growing trend
of economic, commercial and cultural globalisation...which carry the risk of
economic marginalisation,” he declared.
Mubarak said COMESA should push
ahead with moves to set up a customs union and set unified external tariffs by
2004, also the target date for the free movement of skilled labour.
He said the trade bloc needed peace
in the troubled African continent and said infrastructure needed to be improved
and information networks needed to be linked.
While Egypt wants rapid progress to expand the free trade area, trade disputes emerged during summit preparations.
When COMESA trade and economy ministers met on Sunday, Namibia, Zambia, Madagascar and Kenya voiced concern at Egypt's plans to sign a trade pact with the European Union next month, Egyptian diplomats said.
Some countries fear Egypt's
association agreement with the EU could give Europe back door access to COMESA
Trade within the bloc, which was established in 1994, has climbed 11 percent a year from $2.5 billion in 1996, according to an Egyptian Foreign Ministry document.
But even existing tariff cuts are
making some COMESA members squirm - Kenya, Zambia and Malawi argue that the
zero tariff area for tradeable goods and services is harming local industry.
Kenya's sugar industry has
complained of dumping by COMESA countries. The bulk of its imports come from
COMESA members Sudan, Mozambique, Malawi, Zimbabwe and Zambia.
Kenya, which already charges 18
percent value-added tax and seven percent sugar development levy on all imports,
is said to be considering introducing import quotas.
Zambia and Malawi, which are also
concerned about rules of origin, want COMESA to let individual countries impose
some duties to protect domestic produce.
Seychelles is to join current FTA
members – Djibouti, Egypt, Kenya, Madagascar, Malawi, Mauritius, Sudan, Zambia
and Zimbabwe – in July. Burundi and Democratic Republic of Congo will also join
this year, Egyptian diplomats said.
The Lusaka-based COMESA has named
Rwanda, Uganda and Comoros as possible FTA joiners this year. COMESA's other
members are Angola, Eritrea, Ethiopia, Namibia and Swaziland.
Tanzania quit COMESA last year,
saying its businesses were too weak to compete in a free trade zone.
The COMESA region has a combined Gross Domestic Product of about $166 billion and three-quarters of its people live below the World Bank poverty threshhold of $1 a day.
ã Reuters Limited 2001.
ã2004 K. Diab. Unless otherwise stated, all the content on this website is the copyright of Khaled Diab.