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Why do Trade Barriers Still Exist in Africa?

Posted by Ziad Hamoui on February 21, 2012 at 4:05 AM

At first, it seems as if everyone agrees; barriers to trade and transport should be abolished, both locally and regionally, trade and transport facilitation are top priorities for a flourishing economy, in addition to endless variations of the same issue. For those who know, the reality totally contradicts the pledges of reform that have been made so many times for so many years.


Indeed, the main idea behind the original creation of the Economic Community of West African States (ECOWAS) in 1975 at Lagos and the subsequent establishment of the Union Economique et Monetaire Oueste-Africaine" (UEMOA) in 1994 at Dakar, was the creation of a regional economic zone where goods and people move freely, where larger markets allow for bigger economies of scale and more prosperity to the regional stakeholders. The logic goes that better business environments mean more investments, which leads to more jobs creation, hence higher domestic incomes and government revenues.


And yet, these aspirations failed to materialize, but rather revealed a myriad of related issues; the lack of political will to reform some of the obsolete regulations at the points of entries and border-crossing, differing customs procedures and duty regimes, lack of funds and unwillingly to relinquish centralized control are just the tip of the iceberg, as deeper dialogue between various public and private stakeholders continue to expose conflicts of interests and clashing priorities; should goods security supersede transport efficiency?


Nevertheless, continuous dialogue is visibly improving the awareness of the various stakeholders of the collective responsibility that is required, in order to achieve social, poltical and economical prosperity; so, for example, it is true that cargo hijacking is a serious threat to transit trade, but it is also true that, without faster procedures, inefficiency will always lead to high costs for consumers and inefficient trade for all parties involved. This will eventually reflect on the budget allocated to uniformed services for ensuring cargo security because of dwindling taxes due to decreasing trade.


These conundrums will continue to exist until all those involved in trade and transport realize that they need to keep in mind the "big picture"; with a holistic dialogue, the elimination of conflicts of interest between the public and private stakeholders will result in a visible speed-up in regional integration initiatives, which will be in everybody's benefit.

Categories: Opinion

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