Many academic researches and studies about Africa have stressed the need for an effective intra-regional trade as a major tool in accelerating the continents developments efforts. The continent which has been tagged as the “next big thing’ however, has certain challenges like multiple trade blocks, inadequate hinterland connectivity etc which has been identified among others as some of the major blockages to a successful regional economic integration.
Statistics and figures shows that while Asia, America and Europe trade massively within itself, Africa is yet to explore the full potential of trading within herself with most of its trade rather targeted at the advanced foreign markets. A research by the pan-African bank, Ecobank, estimated that about 60% of Europe’s trade is within the E.U region, whiles in America the figure is estimated at 40% with similar situations in the Asia. On the contrary, it is estimated that only 20% of Africa’s trade stays within the continent.
Over the years , policies have been drafted and structured all in an attempt to bring some sort of integration within the west African sub region. An example is the “ECO” a common currency expected to be used within the sub region which still remains on paper with difficulties and challenges regards its implementation.
On the other hand, one great policy which seem to have seen the light of day is the ECOWAS Common External Tariff (CET). This policy which is to be implemented this June in Ghana is aimed at creating a common market or trade zone by harmonizing the customs regimes in member countries.
Whiles this policy is seen by stakeholders to help eliminate cross boarder smuggling since goods imported into the region would attract the same duty rate irrespective of the country of destination. This would minimize the instances where some importers route their cargo through other neighboring countries just to avoid some taxes and it would in fact even make it more expensive as cargo would subsequently be transported again to the final country of destination.
Another laudable provision of the policy is that, it eliminates the payments of duty on cargo originating and destined for countries in the region. What this means is that member countries can now import and export goods within the region duty free, this single provision would improve intra-regional trade which is much needed to improve the global trade competitiveness of member countries.
Indeed this presents good times to trade within the West African sub-region (all things being equal) as regional economic integration seem more viable comparably to political integration. Leaders should therefore focus on structuring policies to integrate the region economically first and political integration may follow.
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