Experts have called on Africa’s three trade blocs of COMESA, EAC and SADC to expedite the harmonisation of rules of origin to boost industrialisation and intra-regional trade on the continent.

According to the experts, harmonising rules of origin will encourage competitiveness for the African private sector, and accelerate regional integration.

Rules of origin are the criteria needed to determine the national source of a product.

The importance is derived from the fact that duties and restrictions in several cases depend on the source of imports.

And according to the experts, stakeholders should move fast and have the rules harmonised to help avoid trade deflection on the continent.

The desire to merge Common Market for Eastern and Southern Africa (COMESA), the East African Community (EAC), and the Southern Africa Development Cooperation (SADC), was first mooted in 2008.

In June 2015, the Heads of State and Governments of the, EAC and SADC officially launched the COMESA-EAC-SADC Free Trade Area (FTA), commonly known as the Tripartite FTA.

Sandra Uwera, the Chief Executive Officer, COMESA Business Council and secretary general of the Tripartite Private Sector Regional Dialogue, said the way the rules of origin are designed and implemented on the continent will have profound implications on trade flows and the extent of regional integration.

It is, therefore, very imperative to put in place more effective and simplified transparent rules of origin that will boost the continent’s private sector to tap into a market share of more than 625 million consumers.

"Having rules harmonised in such a market comes with economies of scale on which the private sector can leverage to boost intra-regional trade,” said Uwera.

Uwera was speaking during the first tripartite private sector regional dialogue organised by Private Sector Federation in Kigali, yesterday.

The two-day dialogue brought together more than 21 countries and more than 200 business leaders from COMSESA, EABC and the Association of SADC Chambers of Commerce and Industry (ASCCI).

She added that producers on the continent will be able to produce massively for export markets once the rules have been harmonised.

"Even as we look towards the advantages of the Tripartite FTA, one cannot ignore the challenges faced in this ambitious agenda of harmonising a preferential trade regime for 26 countries. Key among these are long distances and geographical locations among states which is further complicated by the poor infrastructure, inefficient logistics and cumbersome customs procedures,” Uwera noted.

To live up to its potential, the Tripartite FTA needs to effectively enhance the connectivity and linkages among member states.

Lilian Awinja, the EABC executive director, said the objective of developing rules of 0rigin should be to avoid trade deflection and encourage intra regional trade.

"We must ensure that the final rules are not trade-restrictive but simplified and more general rather than product specific except in minor cases where it is necessary,” Awinja said.

Ideally, tariff liberalisation under preferential arrangement should be accompanied by simple and flexible rules– which will make it easy businesses to access the market and take advantage of preferential treatment, she added.

Oswell Binha, the vice president of the Association of SADC Chambers of Commerce and Industry, said harmonising the rules has the potential to transform regional trade through market integration and product diversification.

"It will also allow us regional accumulation, enhanced trade cooperation, and reduced cost of doing business on the continent.”

Renewed commitment

According to Emmanuel Hategeka, the permanent secretary at Ministry for Trade and Industry, rules of origin have become increasingly important to match the rise in regional and global value chain trade.

"Intra African trade remains low at about 12 per cent because of various constraints which includes unharmonised rules of origin,” Hategeka, said.

It’s therefore, high time the private sector leaders started reflecting on how to get trade rules that will contribute to policies that will enhance trade on the African continent.

"Commitment at the political level should be matched with a sense of urgency when it comes to harmonising rules of origin; we also need not to forget that increasing connectivity and industrialisation on the African continent requires among other things harmonised rules of origin,” added Hategeka.

The rules of origin should be administered in a consistent, uniform, impartial, transparent and reasonable manner, he warned.

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