A map of the Free Trade Area (FAT) is shown on the screen during the 28th summit of the Southern African Development Community (SADC), in Johannesburg, South Africa, Aug. 17, 2008. The SADC officially launched the Free Trade Area (FTA) under the theme of "SADC Free Trade Area for Growth, Development and Wealth Creation" on Sunday.(Xinhua Photo/Xu Suhui)
THE Southern African Development Community (Sadc) which boasts 15 members including Zimbabwe, is now a Free Trade Area (FTA) as leaders attending the just ended summit of heads of states and government have signed the related agreement.
Following along the lines of the European Union and other regional free trade zones the region has made a historic step toward the vision of a fully integrated economic region.
This means most goods produced in the region can now enter member countries free of custom duties. As for January next year, 85 per cent of goods will be exempted from tax in the SADC area aiming to fully liberalize by 2012. This will help to facilitate smooth operation of business among SADC member states and reach out to 230 million consumers in the sub-region.
The memorandum establishing the FTA – an idea first mooted (and adopted) in Maseru, Lesotho after it gained independence from Britain in 1966 – says it is expected to enhance economic growth, create jobs and fight poverty in the region.
The current SADC Chair President Thabo Mbeki launched the trade protocol, and praised the region's joint effort. He warned against taking the agreement for granted as it was a major step in the development of the region.
“I raised this because we need to resuscitate the shared vision and commitment, the unity and cohesion that has characterized Sadc from its inception”, said President Mbeki.
In line with this vision, the South African president pledged the Sadc troika's total commitment to resolving the Zimbabwe crisis, stressing that only Zimbabweans will be able to truly find a solution to the crisis in the country.
Eleven of the 14 countries that are part of the Southern African Development Community (SADC) will participate in the Free Trade Area. These are Botswana, Lesotho, Madagascar, Mauritius, Mozambique, Namibia, Swaziland, Tanzania, South Africa, Zambia and Zimbabwe
Three SADC countries - Angola, the Democratic Republic of Congo and Malawi - plan to join at a later date due to weak economies.
The Free Trade Area precedes a Customs Union planned by 2010, a Common Market by 2015, Monetary Union by 2016, and a single currency by 2018.
The agreement is inspired by the classic principles of comparative advantages, which in this case advocate that member countries should produce and export goods with a comparative advantage, importing good from the region’s countries that they are unable to efficiently produce themselves.
The two-day summit was also marked by the return of the Seychelles, a small archipelago in the Indian Ocean which decided to move out of the Sadc immediately after it joined in 2000 for economic reasons. It is yet to join the FTA.
Jay • N/A Subject: N/A Tue, 19 Aug 2008 16:44:40 • Omuhle - FYI Zimbabwe's economy is much stronger than the 2 countires you mentioned despite dacades of battering, corruption &being at less 20% of capacity. Actually, those 2, along with Moz, Zambia, Madagascar, Lesotho &Malawi are aomng the UN's 50 poorest countries ranked by, among other GDP per capita. Zim is not! http://www.un.org/special-rep/ohrlls/ldc/list.htm
Omuhle • n/a Subject: n/a Tue, 19 Aug 2008 12:46:58 • Angola and DRC didn't join due to weak economies? Isn't this sarcasm of the highest order? If we were to rank the SADC countires by economic strength where would Zimbabwe fall? Behind or ahead of Angola which has massive oil and diamond industries?
As for this SADC troika can you please stop misinforming people. There is no such thing as a SADC troika dealing with the Zimbabwe crisis. Apart from Mbeki which other 2 countries make up this troika? This is an attempt to bring in mediation by others, who have a bias towards Mugabe, through the back door. Not going to happen.
As for this FTA. it is all good and well for those countries that will do alot of exporting because they don't lose revenue as they weren't charging any duty or taxes on exports. It's the countries that will be at the receiving which will be at short end of the stick, the burning, short end of the stick. Imagine that Zimbabwe needs fuel and other oils or even food produced in Malawi. By exporting to Zimbabwe, Malawi makes money from these exports but a business man in Zimbabwe can import free of taxes which means the govt in Zimbabwe gets less from tax revenue. Now coupled with the shrinking tax base in Zimbabwe this means less money for roads, lighting, education and other money draining but non-revenue producing things like Air Zimbabwe, CMED, NOCZIM and so on. Already we know the govt is charging a levy of generators and this is an indication they are desparate to latch onto anything making money in the country and get their share of the money. Wouldn't it have been wiser to allow this industry to grow without the hindrance of levies or taxes as they are surley aware what the effect of power cuts has had on the country. Just like what they did with construction equipment and they should do with farming equipment or else no one will want to invest.
Zimbabwe massive • zimbabwelive@aol.com Subject: Fantastic Tue, 19 Aug 2008 10:32:47 • This is fantastic news to all of us in Southern Africa and the promise of a new dawn. This cooperation has many benefits and something that will give a new dynamic to our Zimbabwean industry. Excellent news from Sadc leaders, may they keep forging ahead in unity and perhaps spread this further outside Sadc in the future.
Early Times • isaac_1212@hotmail.com Subject: The Birth of the United States of Africa Tue, 19 Aug 2008 07:45:01 • Notwithstanding some setbacks in the political arena of Southern Africa, is the global community witnessing the birth of the United States of Africa? The content expressed in this article would seem to lead readers in this conclusion. For all those working tirelessly for new directions that address the needs of the people on the entire continent of
Africa, God's speed and blessings!
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