The Confederation of Zimbabwe Industries (CZI) has said the proposed continental manufacturers’ body will be a catalyst for the development of value chains critical for the growth of companies.
The African Union Commission (AUC) is pushing for the creation of a single manufacturers’ association that will build capacity to enjoy the benefits of an enlarged market following the creation of the African Continental Free Trade Area (AfCFTA).
The idea of a continental manufacturers’ body was mooted at the inaugural Intra-African Trade Fair held in Egypt last month.
CZI president Sifelani Jabangwe told Business Times this week that the proposed association would increase relationships among manufacturers. “The purpose of a trading bloc is to facilitate economic development through industrialisation so the association will assist in developing the value chains,” he said adding that it would help build alliances.
“We have local companies that manufacture PVC quoted fabric. A company that manufactures bags in Zambia is importing from Europe.” The creation of a continental manufacturers’ association is part of a drive to boost intra-African trade which is at 15 percent compared to Europe (59 percent), Asia (51 percent) and North America at 37 percent.
The UN Economic Commission for Africa estimates that AfCFTA would increase intra-African trade by about $35 billion a year by 2022 thereby lifting millions out of poverty.
Zimbabwe does not trade more with African countries with exports largely destined for South Africa (62,7 percent), Mozambique (10,5 percent), United Arab Emirates (6,4 percent), Zambia (1,7 percent) and Belgium (1,5 percent). Zimbabwe’s major sources of imports include South Africa (40 percent), Singapore (22 percent), China (9 percent), Zambia (3 percent), and Japan, Mozambique, United Kingdom, India, Mauritius and United Arab Emirates (2 percent).
Last month, AUC Commissioner for Trade and Industry Albert Muchanga said the association would afford the AUC an opportunity to work closely with the manufacturing sector of the continent to build the requisite capacity to produce for the enlarged AfCTA market.
“We will mainstream the Association into our Work programmes for an enriched exchange on industry and trade policy related subject, to build a competitive business environment in the continent,” he said. According to a scheduled programme, the founder of the AfroChampions and the Head of Industry in the African Union Commission would assist in mobilising manufacturers from Central and North Africa respectively to participate in the inaugural meeting of the proposed Association set to be held during the 2nd quarter of 2019.
The first meeting of the proposed Association is to be held after a conference on Transforming African Manufacturing to Supply the AfCFTA market to be organised by the African Union Commission.
The strategic focus of the conference would be on the development of viable regional value chains to promote specialisation and win-win outcomes in the continent.
The inaugural meeting of the African manufacturers is envisaged to adopt the draft Articles of Association, elect a bureau, and agree on the institutional framework and seat of the association.
The meeting will also appoint a substantive secretariat which will be tasked to prioritise registration of the Association as a key deliverable on its inception work programme.
After the registration of the association, a draft memorandum of understanding (MoU) between the Association and the African Union Commission would be drawn up and signed.
Through the MOU, the Association would be invited to the Meetings of the Specialised Technical Committee on Trade, Industry and Mining to engage policy makers on strategic subjects of industry and trade that have a bearing on improving the business – enabling regime, and competitiveness among others.