ECONOMY: Southern African Countries Seek to Trade as a Bloc

By James Hall Reprint | | Print |

James Hall

GABORONE, Botswana, May 13 2003 (IPS) - Southern African economies and the lives of the people will be elevated when the "Made In SADC" label, designating goods produced in the 14-member states of the Southern Africa Development Community (SADC), becomes a worldwide recognised assurance of unique quality merchandise, industry and government trade representatives were projecting at a meeting to boost regional exports.

"One way of fostering the competitiveness of SADC in the global market place would be the creation of a ‘Made in SADC’ label that, by relying on high conformity with the most demanding quality, safety and sanitary standards could become a landmark in the global markets," proposed Salvador Namburete, Deputy Minister from Mozambique’s Ministry of Industry and Trade, over the weekend.

However, Namburete acknowledged the goal is complicated by different levels of development of regional nations. "Many of them have gone through long and difficult periods of economic hardship, civil unrest and even war. They lack capital, technical and managerial skills, and basic infrastructure (including physical, legal, institutional, etc.) to be able to compete in the global markets," he said.

But delegates assembled for the dedication of the Southern Africa Global Competitiveness Hub, set up by the U.S. government to facilitate trade between Africa and the rest of the world (two other regional hubs have been opened in Nairobi, Kenya and Accra, Ghana) advanced both philosophically and in practical terms the goal of regional economic partnerships.

All Southern African nations share one agenda, to raise the standard of living for their people, 40 percent, or 70 million, of whom are impoverished by global standards, according to official statistics.

"One way of raising incomes is trade, which calls for goods that are made in factories that hire workers," Taly Tshekiso, Director of Caratex Botswana, a textile firm, told IPS.

"Economic empowerment of the poor, and especially African women, also comes through non-traditional industries, such has handicraft. The many farmers and handicraft cooperatives that are eager to expand their markets would hugely benefit by exporting to the developed world," said Savoo Dee, Marketing Director of Sunflag Tanzania in Dar es Salaam.

Most SADC nations now have made inroads into the lucrative North American market through the U.S. trade initiative, the African Growth and Opportunities Act and various bilateral trade agreements offered by the European Union. Contracts have been secured by large industrial and agricultural commodities companies, but also by small grassroots cooperatives that produce unique works of decorative art.

Now SADC nations are looking at a "strength through numbers" approach, where regional countries set standards and trade as a bloc.

"This requires a true and creative partnership, but it is only through partnership that we will be able to address some of the most pressing issues of our time – a partnership that involves advancing sustainable development strategies that put people at the centre stage of development," said Namburete.

Such a partnership would require constructive dialogue between governments, the private sector and civil society, and one that philosophically implies that the development process is "owned" by all of these groups, and not just one.

Practically, a regional export that would bear the "Made in SADC" label would require streamlining bureaucratic hindrances like red tape and customs pile-ups at borders, as well as unified quality controls.

For small rural and urban businesses and cooperatives, even knowing about international standards required for the products to be accepted in international markets is a problem. The second task is to meet those standards.

Clement Thindwa, chief executive officer of the Association of SADC Chambers of Commerce and Industry, said, "Our national and regional authorities must set up support structures and facilitate technology transfer through joint ventures with developed world companies. Such ventures would also provide capitalisation, and increase foreign investment in the regional economy."

"The benefits to be derived from the regions poor are three-fold," said Thindwa. "Firstly, new export industries create jobs, reducing unemployment and providing wages. Secondly, new tax revenues fund a nation’s social services, benefiting disadvantaged groups through national programmes. Finally, people with products good enough to sell in foreign markets become entrepreneurs. Small businesses evolve into large ones."

No developmental organisations, or civil society groups dedicated to poverty alleviation, were amongst the economics ministers and business leaders assembled at the opening of Gaborone’s regional competitiveness hub. But the dominant concern was using trade as a tool to ease the chronic poverty that affects all SADC nations.

Southern Africa is facing serious food and humanitarian crisis, affecting over 14 million people, according to aid agencies operating in the region.

Deborah Cutting, project coordination for the National Agricultural Marketing Board in Swaziland, noted, "The majority of rural communities have based their agricultural production on subsistence farming, and have failed in commercial production due to financial constraints. But some products are suitable for the export market, and can be produced with some modest technical assistance."

She noted that small-scale agro-businesses in Swaziland have turned to high value items such as baby vegetables, which have high profit potential and are in increasing demand. These include tiny Zucchini, baby cauliflowers and sugar snap peas popular in salads.

Such creative ideas will boost SADC exports. Along with such imagination is the necessity for ensuring quality control. EU food standards are exacting, and any deviation will bar a product from that market. The European Union is also demanding that exporting companies conform to workers’ safety standards and environmental rules.

Once these standards are applied uniformly throughout the Southern Africa region, the "Made in SADC" label will become a recognised sign of quality that will signal the economic upliftment of nearly 200 million people.

Southern Africa comprises Botswana, Lesotho, Swaziland, Zimbabwe, Namibia, Zambia, Malawi, Tanzania, South Africa, Angola, Mozambique, the Democratic Republic of Congo (DRC), Seychelles and Mauritius.