Botswana is likely to sign the African Continental Free Trade Agreement (AcFTA) at the next African Union Assembly of Heads of State and Government scheduled for 11th to 13th February 2019 in Addis Ababa, Ethiopia.
However, whether we are likely to sign will depend on what Cabinet will advise President Dr. Mokgweetsi Masisi. This is according to Director, Department of International Trade in the Ministry of Investment, Trade and Industry, Gideon Mmolawa.He told Botswana Guardian that, “as officials” and having resolved issues of concern, “we have recommended that Botswana sign”. Botswana could have signed the Agreement during the December 2018 meeting of African Ministers of Trade but was held back by some outstanding issues.
Asked what these outstanding issues were, Mmolawa said they had to do with finalisation of modalities relating to the threshold of sensitive and exclusion products. “Reaching consensus on these would pave the way for operationalising the Agreement and also demonstrate certainty of the value proposition for Botswana,” he said.The Continental Free Trade Agreement provides Botswana access to the African market estimated at 1.6 billion people in 55 countries.This means a wider and increased market access for Botswana exports; among which are live animals, beef, salt, vaccines for veterinary medicine, minerals and leather products.
The Agreement also diversifies the current export markets and reduces our reliance on traditional markets, said Mmolawa in as much as it gives Botswana’s private enterprises access to inputs at competitive prices. Other benefits of the Agreement include increased opportunities for investment attraction and growth in the services sector across borders.
However, access to markets is one side of the coin. The flipside, which will ensure that the country exploits the free trade agreement, requires coming up with programmes to improve output and efficiencies of local businesses.Mmolawa is confident that Government especially through the Botswana Investment and Trade Centre has placed the country on a pedestal to compete. He cites the implementation of the Botswana Exporter Development Programme as one such programme as a means to this end. The BEDP targets local enterprises who wish to export by developing export marketing plans, capacitating on quality management systems and improvement of productivity, and country market surveys for export development. He said local enterprises are enrolled following diagnostic assessments with a view to determining their export readiness and also to develop interventions that are appropriate.
Awareness creation workshops on signed Agreements for example, trainings on market access opportunities including trading requirements and regulations are also held for local businesses to position them to compete. Meanwhile, Botswana signed the Tripartite Free Trade Area (TFTA) on the 30th January 2018, which has also provided it access to a market of 700 million people.
The TFTA is between three regional economic blocs, being East African Community (EAC); Common Market for East and Southern African States (COMESA) and the Southern African Development Community (SADC). Botswana has not yet ratified the Agreement. According to Mmolawa, ratification is dependent on the conclusion of tariff offers between the East Africa Community and the Southern African Customs Union. Mmolawa said that under this Agreement Botswana will be able to access the market for live animals, beef, salt, vaccines for veterinary medicine, minerals, leather products and other products.
As for the policy space to enable businesses to explot this Agreement he cited the National Trade Policy whose objective is to expose local producers and consumers to a wider scope of international inputs, goods and services; and also provides for a conducive environment for industrial development, economic diversification, export-led growth and economic integration.Mmolawa also mentioned the National Export Strategy of 2010 whose objective is to enable global competitiveness for Botswana. This strategy was refocused with a view to accommodating the dynamic industrial revolution, where Botswana wishes to achieve possible expansion of current levels of exports and future prospects in the international markets as well as diversify the country’s export base.
The country also creates contacts and business match making through outward investment promotion missions; and has a trade facilitation programme whose objective is to reduce the time and cost of importing and exporting. This is made possible through a One Stop Border Post which enables neighbouring countries to coordinate import, export and transit processes so that those transiting stop only once at either side of the border to undertake regulatory formalities, for example, between Botswana and Namibia.
Mmolawa said that other interventions being implemented include the National Single Window, which is a single electronic data information exchange platform that facilitates movement of goods and services across countries; as well as the ongoing Kazungula Bridge Project, which is set to open up the transport corridor between Botswana and Zambia with a view to reducing transit time. It will also contribute to the regions ideals of economic integration.