Namibia, as a member of the Southern African Customs Union (SACU) and the Southern African Development Community (SADC) is involved in a number of negotiations aimed at establishing preferential trade agreements. These agreements are aimed at economic growth by reducing barriers to trade, diversifying Namibia’s portfolio of export markets as well as promoting regional integration. By virtue of its membership to the National Negotiating Team, ATF is actively involved in these initiatives. This section provides information on all the trade negotiations and agreements. You will also find the texts for the Agreements that have been completed
CFTA - Continental Free Trade Area to be launched in March 2018!
Objectives of the CFTA
• Create a single continental market for goods and services, with free movement of business persons and investments, and thus pave the way for accelerating the establishment of the Continental Customs Union and the African customs union.
• Expand intra African trade through better harmonization and coordination of trade liberalization and facilitation regimes and instruments across RECs and across Africa in general.
• Resolve the challenges of multiple and overlapping memberships and expedite the regional and continental integration processes.
• Enhance competitiveness at the industry and enterprise level through exploiting opportunities for scale production, continental market access and better reallocation of resources.
Background
The 18th Ordinary Session of the Assembly of Heads of State and Government of the African Union, held in Addis Ababa, Ethiopia in January 2012, adopted a decision to establish a Continental Free Trade Area (CFTA) by an indicative date of 2017. The Summit also endorsed the Action Plan on Boosting Intra-Africa Trade (BIAT) which identifies seven clusters: trade policy, trade facilitation, productive capacity, trade related infrastructure, trade finance, trade information, and factor market integration. The CFTA will bring together fifty-four African countries with a combined population of more than one billion people and a combined gross domestic product of more than US $3.4 trillion.
Negotiations
Negotiations for the CFTA are expected to in June 2015 and the CFTA should be launched by an indicative date of 2017. The main objectives of the CFTA are to create a single continental market for goods and services, with free movement of business persons and investments, and thus pave the way for accelerating the establishment of the Customs Union. It will also expand intra-African trade through better harmonization and coordination of trade liberalization and facilitation and instruments across the RECs and across Africa in general. The CFTA is also expected to enhance competitiveness at the industry and enterprise level through exploitation of opportunities for scale production, continental market access and better reallocation of resources. The establishment of the CFTA and the implementation of the Action Plan on Boosting Intra-African Trade (BIAT) provide a comprehensive framework to pursue a developmental regionalism strategy. The former is conceived as a time bound project, whereas BIAT is continuous with concrete targets to double intra-African trade flows from January 2012 and January 2022.
CFTA leaders and negotiators heading to Kigali
The leaders of Africa’s 55 countries will make history on March the 21st, when they come together in Kigali, Rwanda, to sign an agreement that will launch the African Continental Free Trade Area (the AfCFTA). The AfCFTA will make the continent the largest free trade area created since the formation of the World Trade Organisation.
The launch will take place at an Extraordinary Meeting of the Heads of State of the African Union convened by President Paul Kagame of Rwanda, the new Chairperson of the AU who said of the AfCFTA: “This is a historic pact which has been nearly 40 years in the making, and it represents a major advance for African integration and unity.”
H.E. Moussa Faki, the Chairperson of the African Union Commission says the African Continental Free Trade Area will also strengthen Africa’s position in global trade: “AfCFTA will make Africa one of the largest economies in the world and enhance its capacity to interact on equal terms with other international economic blocs.”
SACU - European Free Trade Association
SACU and the European Free Trade Association (EFTA) States of Iceland, Liechtenstein, Norway and Switzerland signed the Free Trade Agreement on 26 June 2006. The Agreement entered into force on 1 May 2008.
The Agreement covers trade in goods and makes provision for further engagement on issues related to intellectual property, investment, trade in services and public procurement. The Agreement further establishes a Joint Committee for administering the Agreement and to address the review of the Agreement.
With respect to agriculture, the Agreement provides for concessions on processed agricultural products. Trade in processed agricultural products is covered in an Annex to the main Agreement (Annex III). However, trade in basic agricultural products is covered by separate bilateral agreements between SACU and Norway, Iceland and Switzerland.
EFTA – SACU Free Trade Agreement
The objectives of this Agreement are to:
- achieve the liberalisation of trade in goods in conformity with the General Agreement on Tariffs and Trade (hereinafter referred to as “the GATT 1994”);
- substantially increase investment opportunities in the free trade area;
- promote adequate and effective protection of intellectual property rights;
- establish a framework for the further development of their trade and economic relations with a view to expanding and enhancing the benefits of this Agreement; and
- contribute in this way to the harmonious development and expansion of world trade by the removal of barriers to trade.
SACU – Latin American countries of MERCOSUR
SACU and the Latin American countries of MERCOSUR, signed a Preferential Trade Agreement in December 2004. MERCOSUR consists of Brazil, Argentina, Uruguay and Paraguay.
The Agreement is limited in scope in that it only contains fixed preferences on around 1000 products contained in Annexes I and II. This was as a first step towards establishing a free trade area between SACU and MERCOSUR. The Agreement has not entered into force yet as some of the MERCOSUR member states are yet to ratify the Agreement.
SADC - United States Trade, Investment & development cooperation agreement
SACU and the United States of America (USA) signed a Trade, Investment and Development Cooperation Agreement (TIDCA) on 16 April 2008. It is a cooperation agreement aimed at promoting investment and expanding and diversifying trade between SACU and the USA.
The TIDCA emanates from the previous Free Trade Agreement (FTA) negotiations between SACU and the US, which were suspended in 2006 due to divergent views on the scope of the FTA. Thus, TIDCA is envisaged to be a building block for a future FTA.
The TIDCA establishes a forum for consultations, cooperation and possible agreements on customs and trade facilitation, technical barriers to trade, Sanitary and Phytosanitary measures, and trade and investment promotion.
Current negotiations for preferential trade agreements
More information about the SADC – EPA and the COMESA – EAC – SADC Tripartite Free Trade Agreement.
SADC – EPA
Namibia, together with Angola, Botswana, Lesotho, Mozambique, Swaziland and South Africa, is negotiating to establish a Free Trade Agreement with the European Union (EU). Although SADC consists of 15 member countries, other eight SADC Member States (Democratic Republic of Congo, Madagascar, Malawi, Mauritius, Seychelles, Tanzania, Zambia and Zimbabwe) are negotiating in other regional EPA configurations. The group that Namibia is negotiating in is called the SADC EPA Group.
The Economic Partnership Agreement was necessitated by the expiry of the trade chapter of the Cotonou Agreement, which was granted a waiver under the World Trade Organisation rules. This waiver allowed non-reciprocal and preferential market access for goods from African, Caribbean and Pacific (ACP) countries into the EU.
At the end of 2007 Botswana, Lesotho, Swaziland, Mozambique signed the Interim EPA. Namibia only initialled the Interim Agreement with a declaration that concerns raised in the Agreement will be addressed in the negotiations towards the full EPA. In 2010, the parties agreed to abandon the Interim EPA and work towards concluding a final EPA. The negotiations in this respect are still on-going and are envisaged to be completed in early 2014. The major issues in the negotiations are agricultural market access, export taxes, sustainable development and agricultural safeguard provisions.
COMESA – EAC – SADC Tripartite Free Trade Agreement
The 1st Tripartite Summit held in Kampala, Uganda in October 2008 decided to establish a Tripartite FTA between the regional blocks of SADC, East African Community (EAC) and the Common Market for East and Southern Africa (COMESA). The negotiations were launched at the 2nd Tripartite Summit held in July 2011 in South Africa and the ‘Roadmap for the establishment of the Tripartite FTA’ was adopted. The Tripartite is based on three pillars: market integration, infrastructure development, and industrial development.
The negotiations will be conducted in 2 phases, where Phase I will focus on trade in goods. The Movement of Business Persons would be negotiated during the 1st phase but through a separate track. Phase II of negotiations will cover the built-in agenda in services and trade-related areas, and will commence after the conclusion of Phase I. The overarching objective of the Tripartite is to accelerate economic integration of the continent and promote intra-continental trade. The FTA, once concluded, is expected to cover 26 countries on the African continent. While the negotiations where launched in 2011, the FTA is expected to be launched in January 2016.
