Former WB Official calls for streamlining of African regional trade agreements
A former Vice President of the World Bank in charge of Africa, Dr. Gorbind Nankani has stated that African countries would only be in a position to achieve effective economic growth if existing trade agreements within the regions are streamlined to meet competitive global standards.
Dr. Nankani argued that there are too many regional trade agreements on the African continent, which have not in anyway promoted effective trading systems. What they have rather done, he noted, is to entrench existing bureaucratic systems in individual countries.
Regional bodies in West, East, Central and South Africa all have existing trade agreements among them but their effectiveness have not been felt, according to market analysts. In West Africa for example, member countries within ECOWAS have numerous trade agreements. Individual countries are still yet to fully open their markets to each other, with security officials at the various borders said to be harassing traders at both ends.
The situation is equally the same in East and Southern Africa where traders complain of harassment from border officials. Haulage trucks normally complain of harassments from border officials who detain their trucks for refusing to pay bribes.
In an interview on Accra-based radio station JoyFM, the former WB Africa boss said such bottlenecks would be eliminated once the existing agreements are properly streamlined to enhance effective trading systems. This would contribute to the building of a much stronger market.
He disclosed that trade among African countries is currently pegged at only 15% of total trade engagements.
On how to reverse the trend, the former WB official said the African Union must take pragmatic steps to address the overlapping trade agreements among member states.
Dr. Gorbind Nankani said until that is properly looked at by the AU, the economies of most of the countries would continue to be tied to the economic chords of the developed countries.
He said as a first step the AU could begin by addressing the lack of technical staff at its secretariat.
Touching on the Economic Partnership Agreement (EPA), Dr. Nankani could not say whether or not it is bad for Africa but said some countries are in a better position negotiating as a group.
He said Ghana, which signed what is now described as EPA light, could afford to partner Cote D'ivoire to present a front that is much stronger than a single entity.
“This will help us to use the EPA to get into a more global market.”
According to him, countries like Nigeria and South Africa are not too keen on signing any aspect of the EPA because it does not really affect them in anyway because of the presence of oil and gold reserves.
He also called on African governments to focus more on trade within AU member states instead of the continuous trading arrangements with developed countries. According Dr. Nankani African countries could take a cue from the penetration of China into African markets.
“We need a China policy to make sure investment flows so that the spill over will be felt by the entire population on the continent.”
Dr. Gorbind Nankani said China is the fastest growing economy and it is prudent that African countries take a complete cue from them.
He cited for example the current trend where Chinese companies operating in various parts of Africa bring in their own personnel into the countries as part of their investment package.
This, he said, has somewhat reduced the unemployment levels in China.