Page last updated at 17:57 GMT, Thursday, 23 October 2008 18:57 UK

Cape to Cairo unity was 'over due'

Sunset over Cape Town in South Africa (Photo by BBC News website reader Andre van Selm )

Three African trade blocs from Cape Town to Cairo have agreed to create a free trade zone incorporating 26 countries with a GDP of an estimated $624bn (382.9bn).

Oduor Ongwen, of the Southern and Eastern African Trade Information and Negotiations Institute, tells the BBC News website that the integration of Sadc, the EAC and Comesa will be a profitable move for the continent.

It's a step in the right direction and it is actually more than 18 years over due.

The area that will be covered by the deal
For me the geographical area it is covering is still not large enough

This is an idea that was mooted in 1980 when Africa gave itself 20 years to realise complete economic integration.

Politically, I would say there are challenges, but these are challenges that with the right mindset and political goodwill can be overcome.

Economically, I don't think we have a choice, given the trend in the global economy and the move to integration into big economic blocs where you have the European Union and Nafta (North American Free Trade Agreement).

Africans are left with no choice.

In fact, for me the geographical area it is covering is still not large enough.

What we would want to see in the foreseeable future is the entire African continent becoming one economic unit because with that you have a fairly wide resource base and a big market.

Prosper fast

The reason why there is little value addition and Africa continues to specialise in extraction and exportation of primary commodities is because we have very, very tiny segregated markets that are not linked to each other.

Animals at sunset on the Serengeti plains in Tanzania
Tourism is an area where countries can join forces to make money

Therefore we cannot roll out a major industrialisation plan due to the disjointed nature of our resource base.

With a population of more than three quarters of a billion, Africa is a huge market.

If we are integrated so that there are no barriers to movement of labour, goods and services, we are definitely going to be able to prosper quite fast economically.

If you look at the topology of Africa we basically share a lot of natural resources.

Take the tourism belt which runs from eastern Africa to the south, from Virunga area (in DR Congo), the Bwindi Forest (in Uganda) through Maasai Mara (in Kenya) and down into the Zambezi River (in southern Africa).

It is a long belt. If we can pool together resources, we can be able to tap a lot from tourism resources.

We have serious deficit of democracy
We have not been able to appreciate these resources and to develop them.

But it is not going to be easy as there are quite a number of internal and external challenges.

We have serious deficit of democracy and I need not mention specific cases but all the way from west to east, from north to southern Africa, we have examples.

We have external challenges too and the challenges of infrastructure.

Mutual suspicion

The rail system in Africa, which is quite underdeveloped, is about moving from the hinterland of countries like Kenya, to the sea, not integrating them.

Cattle by a railway line in Nigeria
Africa's transport infrastructure is inefficient and not well connected

If you look at road networks, it is not about facilitating intra-regional trade. If you look at our energy resources, we have not been able to develop that.

There is also mutual suspicion between countries. We can see it in the East African Community (EAC) - 10 years after the treaty was put in place, there is still serious suspicion between Kenya, Uganda and Tanzania.

The Tanzanian business community thinks that the Kenyan economy is so strong and if we integrate, the Tanzania business community is going to be wiped out.

Uganda and Kenya feel that there is a lot of influence of South African business in Tanzania which they think will give them unfair competition.

At the Comesa (Common Market for Eastern and Southern Africa) and Sadc (Southern African Development Community) level, most of these economies are wary of South Africa's economic aggressiveness.

Some of them might be real fears, some of them might be imaginary, but they are there and if we don't deal with them we're not going to go very far.

United States of Africa

The entire intention is to realise political unity.

What was envisaged was four stages beginning with economic co-operation, then a customs union, then a common market and monetary union and then development into a single political unit.

The dream of [Ghana's first President, Kwame] Nkrumah was always to have what he called the United States of Africa, a single political entity that can articulate and defend the interests of the African continent.

There are very serious challenges to this because we have egos to deal with and problems with regard to political systems and democratisation.

But as long as we can free these countries economically and integrate, then a political union will definitely follow.

African free trade zone is agreed
22 Oct 08 |  Business


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