Comesa Eyes Common External Tariffs
The Common Market for Eastern and Southern Africa (Comesa) has put the launch of a customs union top on its agenda this year.
A statement from the trading bloc's secretariat said the union should be in place by the end of the year, citing an expanded market as possible gains for manufacturers and service providers in the 19- member countries.
Doubts, however, remained over this ambition following a decision by seven member states to defer their joining of the bloc's free trade area (FTA) that is considered a prerequisite to a customs union. They are Seychelles, Swaziland, Uganda, Angola, Comoros, Congo DR and Eritrea.
The customs union, which would bring member countries under common external tariffs would ease costs and processes of trade. But it is four years behind schedule having been earlier fixed for December, 2004.
It would also create a larger market whose impact is to expose firms in member states to greater competition as manufacturers and service providers seek to meet expanded consumer demand. Manufacturers are also expected to reap the benefits of large scale production in the form of lower unit costs.
A total of 13 members of the FTA have lowered their tariffs by between 60 and 80 per cent and helped to increase the value of intra-Comesa trade from Sh201 billion in 2000 to Sh469 billion in 2007.
Last year, Comesa director for trade, customs and monetary affairs Charles Chanthunya said the Secretariat was working on the final touches of the customs union.
The FTA, which was launched on October 31, 2000, provides for reciprocal arrangements that require participating states to allow duty free entry to their markets for goods that qualify under Comesa rules of origin.
The customs union eliminates import duties and other restrictive regulations relating to cross-border trade. Import duties and other regulations of commerce are however applied to any goods from territories that are not included in the union.
The Comesa secretariat said all that remained was the harmonisation of other regulations of commerce, the schedule of national tariff alignments to the Common External Tariff (tariffs applied to non-members), conclusion of sensitive products lists and implementation modalities for the seven principles of the Customs Union agreed by member states.
The seven principles relate to Common External Tariff rates and Sensitive Products; Free Circulation of Goods and Elimination of Rules of Origin; Revenue Distribution; Treatment of Goods from Export Processing Zones; Trade Remedy Measures and Competition Policy; Sanitary Phyto Sanitary (SPS) and Technical Standards Programme on how to deal with Bilateral Treaties, Arrangements with Third Parties and Common Negotiating Positions.
Comesa said it had set several task forces to spearhead work in the in the Common External Tariff; Regional Trade Policy; Customs Management Code; and Revenue Distribution.
The task force on Regional Trade Policy and on the Common External Tariff held their first meeting between January 14 and 15, 2008 and agreed on their terms of reference and programme of work to be completed before May, 2008. The other two task forces (Customs Management Regulations and Revenue Sharing) are meeting in early February to do likewise.
The special ministerial task force on the Customs Union will meet on February 11, 2008 in Lusaka, Zambia to assess progress and give directions with the view to report to the Summit that will be held in May in Harare, Zimbabwe.