COMESA Free trade area to turn Africa into economic power
Regional, Economics, 11/1/2000
Egypt's President Hosni Mubarak said the Free Trade Area of Common Market For Eastern and Southern Africa (COMESA) clears the way for developing African economy so as to keep pace with competition in the new World Market.
The mere holding of the COMESA extraordinary summit is to tell the world that Africa means business and that it is open to the world, President Mubarak said as he called for greater African cooperation into the world market.
Addressing the summit on behalf of the President, Foreign Minister Amr Moussa termed this gathering of eastern and southern African states as a historic event, not only for COMESA, but for Africa as a whole.
"It marks the launch of the first ever free trade within our continent, paving the way for Africa to evolve as an economy of scale," he told the 20 COMESA member states" .
" It is one that is able to compete in the new global market pursuit of our goal of establishing the African Economic Community, as stipulated in the Abuja treaty of 1991," he said.
"As we celebrate the launching of the COMESA Free Trade today, we must keep in mind that trade liberalization by itself is not our ultimate goal of regional cooperation, but a necessary foundation for enhancing our capacity in order to gain a share of the world market, and to achieve substantial economic and social development in our region and in Africa," he added.
"In fact, our summit in itself is a clear signal to the world that Africa means business and that it is open to the world," he stated.
He recalled the words of President Mubarak at the inaugural session of the first COMESA Regional Economic Conference held in Cairo last February: "Gone is the time of self isolation ,for ours is a world of integration and cooperation among peoples and states".
COMESA comprises Angola, Burundi, Comoros, Democratic Republic of Congo, Djibouti, Egypt, Eritrea, Ethiopia, Madagascar, Malawi, Mauritius, Namibia, Rwanda, Seychelles Sudan, Swaziland, Uganda, Zambia and Zimbabwe.
Tanzania pulled out of the grouping last month.
Following is Egypt's address to COMESA Summit as delivered by Foreign Minister Amr Moussa on behalf of President Hosni Mubarak :
"Your Excellency Sir Anerood Jugnauth, Prime Minister of the Republic of Mauritius and Chairman of the COMESA Authority.
Your Excellency Fredrick Chiluba, President of the Republic of Zambia.
Your Excellencies Heads of State and Government.
Your Excellency Erastus Mwencha, Secretary General of COMESA.
Ladies and Gentlemen.
Allow me at the outset, on behalf of President Hosni Mubarak and on my behalf, to express our sincere appreciation to President Frederick Chiluba and the government and people of Zambia for hosting this historic extraordinary summit to launch the COMESA Free Trade Area, and for the excellent preparations and hospitality.
I would like to commend the tireless effort exerted by the COMESA secretariat, assisting the member states in making the COMESA Free Trade Area a reality, especially the elaborate studies on the impact of FTA on government revenue and competitiveness of our economies.
We all strongly recognize the fact that FTA is an important step in the COMESA vision of total integration, and a prelude to the realization of our pan-African strategy.
"Our meeting today is a historic event, not only for COMESA, but for Africa as a whole. It marks the launch of the first ever free trade area within the continent, paving the way for Africa to evolve as an economy of scale.
One that is able to compete in the new global market, in pursuit of overarching goal of establishing the African Economic Community, as stipulated in the Abuja treaty of 1991.
Establishing the COMESA Free Trade Area entails a host of opportunities and challenges. While the benefits of trade liberalization may be self evident, it is the challenges that rise the most concern and hamper the ability of some of our member states to reap the rewards of free trade.
Despite the fact that most of the COMESA member-countries are applying economic reform programs and libralizing their trade, it is essential to note that not all countries would be affected in different ways by these new Free Trade arrangements.
It is also not surprising to expect different countries to adopt different strategies to arrive at the same goal.
However, I would like to stress that the thorough conducted by the COMESA secretariat in cooperation with the IMF to determine the impact of FTA on government revenue COMESA members, concluded that the loss of such revenues would be negligible, not exceeding two percent of total revenue in most cases, and offered various remedies to compensate for any such loss.
There is no doubt that for any economic integration arrangements to be successful, all members must benefit,and be able to adapt to the changes required.
This can be maximized by better understanding of both the rights and obligations arising from their commitmens possessing the knowledge and institutions able to enhance economic integration, for the benefit of one and of all.
As we celebrate the launching of the COMESA Free Trade Area today, we must keep in mind that trade liberalization is not our ultimate goal of regional cooperation, but a necessary foundation for enhancing our capacity in order to gain a greater share of the world market, and to achieve substantial and social development in our region and in Africa.
In fact, our Summit in itself is a clear signal to the world that Africa means business and that it is open to the world.
At the inaugural session of the first COMESA economic conference held in Cairo last February, Mubarak stated: "Gone is the time of self isolation, ours is a world of integration and cooperation among peoples and states".
This call for more cooperation was echoed late last April when the first African-Europe summit was convened.
The summit provided a propitious forum for the two continents to address a wide range of issues in declaration and plan of action".
"The Africa competitiveness report for the year 2000/2001 has highlighted clearly in its executive summary the necessary components for the African renaissance to flourish, and I quote "We believe strongly in Africa's renaissance, but we believe that it will be the product of a combination of forces: the vigor of African society, and increasingly democratic African policy and the good will and urgently needed financial support of Africa's supporters in the world community."
I might add on my part that the African renaissance can not take place unless the African private sector interacts in a smart and efficient partnership with the African governments.
We strongly believe that if Africa is to truly connect with the global economy, the private sector has to be the engine of growth.
Egypt has called COMESA for and hosted its first regional economic conference in Cairo on 28th and 29th February with the aim to increase international awareness of COMESA as an emerging lucrative market, and to present to the world the vast investment opportunities in the COMESA region.
The first regional conference recorded an overwhelming success, witnessing the participation of more than 1800 participants from all over the globe, and tackling a wide range of issues ranging from investment opportunities in comesa to active participation in the global economy, and developing a serious partnership between regional corporations in some key sectors such as telecommunication and transportation.
It was this success that prompted Egypt to consider hosting the second regional economic conference of the COMESA during the first quarter of the year 2002, to allow ample time for thorough preparation and effective participation, building upon the success of the first regional conference and also the new reality created on the ground by the establishment of the COMESA Free Trade area.
In order to keep the momentum of involving the international and business community in the COMESA region, Egypt will also hold and host a "Mini Business Forum"- to coincide with the upcoming COMESA Authority meeting to be hosted by Egypt held in Cairo in May 2001.
This mini business forum should focus on areas of special interest to member countries particularly in areas of investment and joint ventures.
The COMESA region has witnessed a significant increase in the inflows of Foreign Direct Investment (FDI), surging from meager dlrs 911 million in the year 1990 to dlrs 3 billion in 1998.
As we work together to attract more FDI inflows, Egypt is offering to host the COMESA Regional Investment Agency, approved by the fourth COMESA Authority summit in 1999, to further enhance the investment environment in the COMESA sates, capitalizing on the preferential access Egypt enjoys to the vast markets of the EU and the Arab countries.
While we are working together to create a sound environment for our region, weariless we realise that large-scale economies are essentially built on the strength of smaller units.
Hence, we need to focus more intensively on the promotion of small-and-medium- sized-enterprises (SME'S) and coordinate between the different agencies in COMESA which are for supporting SME's.
In this regard, Egypt has proposed to establish information network of small-and-medium-sized-enterprises operating within COMESA.
This aims at strengthening international co-operation areas relevant to SME's such as exchange of information and database on appropriate technologies for COMESA SME's.
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