LIVINGSTONE MARUFU
Business leaders want the government to expedite the launching of the African Continental Free Trade Area (AfCFTA) implementation strategy before the year end for local companies to benefit from Africa’s single market.
The implementation of AfCFTA has the potential to boost intra-African trade by more than 50% through the elimination of import duties and 100% through the elimination of non-tariff barriers, beginning on January 1, 2021.
The continental market has about 1.3bn people with 54 member States, making AfCFTA the world’s largest free trade area.
But the delay in launching the implementation strategy will see Zimbabwe lagging behind its African counterparts, according to Mike Kamungeremu, Zimbabwe National Chamber of Commerce president.
“For the industry to be able to take full advantage of the trade pact, there is a need to build adequate capacity across all value chains.
“At the present moment, the need for government revenue, given the tight budget resources, is taking precedence over the resuscitation of the local industry. With regards to the SDRs which were allocated to support industry, the business community seeks to know which sectors have received the support so far and to what magnitude,” Kamungeremu said.
During the Chamber’s 2023 Pre-National Budget Consultations, there has been a realisation that the rules of origin are still a challenge for most exporting businesses to understand and adhere to.
In a recent report, the Confederation of Zimbabwe Industries (CZI) said the delay to implement the AfCFTA strategy means the country is not ready for continental trade.
“As things stand now, the country is not ready for AfCFTA given years of deindustrialisation, the decline in local value chains, and limited retooling. The local industry is constrained to take full advantage of the AfCFTA.
“Thus, the industry needs to come up with long-term export strategies that take the AfCFTA into consideration such as growing export markets and retooling or upgrading production processes to become efficient and be able to competitively compete with the rest of the continent,” CZI said.
Experts say the commencement of trading under the Africa-wide free trade area in January 2021 was significant progress that will improve Zimbabwe’s exports into the rest of the continent.
But the delay in launching the implementation strategy and ease of trade restriction in the country could impede as the local exports remain uncompetitive.
Experts said Zimbabwean businesses should seize the opportunity to increase the presence of their products in African countries.
