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COMESA

(Common Market for Eastern and Southern


Africa)

By
Abhinandan Sawant
Ajinkya Wanjalkar

Overview of COMESA
The history of COMESA began in December 1994 when it
was formed to replace the former Preferential Trade Area
(PTA) which had existed from the earlier days of 1981.
COMESA was established 'as an organisation of free
independent sovereign states which have agreed to cooperate in developing their natural and human resources for
the good of all their people
However, due to COMESA's economic history and
background its main focus is on the formation of a large
economic and trading unit that is capable of overcoming
some of the barriers that are faced by individual states.
Ref : www.comesa.int

Overview of COMESA
(contd.)
COMESA's current strategy can thus be summed up in the
phrase 'economic prosperity through regional integration'.
19 member states
Population of over 470.26 million.
Annual import bill of around US$170,895 million.
Export bill of US$112,546 million.
COMESA forms a major market place for both internal and
external trading.
Its area is impressive on the map of the African Continent
covering a geographical area of 12 Million (sq km).
Its achievements to date have been significant.
Ref : www.comesa.int

Vision
COMESAs Vision is to be a fully integrated,
internationally competitive regional economic
community with high standards of living for
all its people ready to merge into an African
Economic Community

Ref : www.comesa.int

Mission
Its Mission to Endeavour to achieve sustainable economic and
social progress in all Member States through increased cooperation and integration in all fields of development
particularly in trade, customs and monetary affairs, transport,
communication and information, technology, industry and
energy, gender, agriculture, environment and natural resources.
The Secretariat was guided to develop its specific Mission
Statement as follows: To provide excellent technical services
to COMESA in order to facilitate the regions sustained
development through economic integration.

Ref : www.comesa.int

Core Values
The Secretariat believes in satisfying its customers
It delivers services with professionalism, integrity
and innovation.
It believes in quality leadership, teamwork and
respect for each other in an enabling environment.
It cares for the environment and upholds its social
responsibility
The Mission and Values Statements on their own
are not sufficient to ensure an efficient and
effective service delivery.

Ref : www.comesa.int

Core Values (Contd.)


They have to be linked to the strategy of the Secretariat
which is building excellence into every process of the
organisation through:
Creation of a participatory environment which allows and
encourages every staff to contribute to the development of
the organisation either individually or in teams.
Enhancement staff competencies through continuous
improvement.
Establishment of economical, efficient and effective
systems and procedures.
Effective and efficient communication.
Ref : www.comesa.int

Evolution of PTA/COMESA
The COMESA traces its genesis to the mid 1960s.
The idea of regional economic co-operation received considerable impetus
from the buoyant and optimistic mood that characterised the postindependence period in most of Africa. The mood then was one of panAfrican solidarity and collective self-reliance born of a shared destiny. It was
under these circumstances that, in 1965, the United Nations Economic
Commission for Africa (ECA) convened a ministerial meeting of the then
newly independent states of Eastern and Southern Africa to consider
proposals for the establishment of a mechanism for the promotion of subregional economic integration.
The meeting, which was held in Lusaka, Zambia, recommended the creation
of an Economic Community of Eastern and Central African states.
Ref : www.comesa.int

Evolution of PTA/COMESA
(Contd.)
An Interim Council of Ministers, assisted by an Interim Economic Committee of
officials, was subsequently set up to negotiate the treaty and initiate
programmes on economic co-operation, pending the completion of negotiations
on the treaty.
In 1978, at a meeting of Ministers of Trade, Finance and Planning in Lusaka, the
creation of a sub-regional economic community was recommended, beginning
with a sub-regional preferential trade area which would be gradually upgraded
over a ten-year period to a common market until the community had been
established.
To this end, the meeting adopted the "Lusaka Declaration of Intent and
Commitment to the Establishment of a Preferential Trade Area for Eastern and
Southern Africa" (PTA) and created an Inter-governmental Negotiating Team on
the Treaty for the establishment of the PTA.
The meeting also agreed on an indicative time-table for the work of the
Intergovernmental Negotiating Team.

Ref : www.comesa.int

Evolution of PTA/COMESA
(Contd.)
After the preparatory work had been completed a meeting of Heads of State and
Government was convened in Lusaka on 21st December 1981 at which the Treaty
establishing the PTA was signed.
The Treaty came into force on 30th September 1982 after it had been ratified by
more than seven signatory states.
The PTA was established to take advantage of a larger market size, to share the
region's common heritage and destiny and to allow greater social and economic cooperation, with the ultimate objective being to create an economic community.
The PTA Treaty envisaged its transformation into a Common Market and, in
conformity with this, the Treaty establishing the COMESA, was signed on 5th
November 1993 in Kampala, Uganda and was ratified a year later in Lilongwe,
Malawi on 8th December 1994.
Ref : www.comesa.int

Evolution of PTA/COMESA
(Contd.)
It is important to underline the fact that the establishment of
PTA, and its transformation into COMESA, was in
conformity with the objectives of the Lagos Plan of Action
(LPA) and the Final Act of Lagos (FAL) of the Organisation
of African Unity (Organisation of African unity).
Both the LPA and the FAL envisaged an evolutionary
process in the economic integration of the continent in
which regional economic communities would constitute
building blocks upon which the creation of an African
Economic Community (AEC) would ultimately be erected.
Ref : www.comesa.int

COMESA Members

COMESA Members

Ref : www.comesa.int

Changes in the Regional


Economy
Up until the late 1980s and early 1990s most COMESA
countries followed an economic system which involved the
state in nearly all aspects of production, distribution and
marketing, leaving the private sector to play a minor economic
role.
This system promoted import substitution and subsidised
consumption

Ref : www.comesa.int

Changes in the Regional Economy


(Contd.)
The inefficiencies inherent in this system contributed significantly to the
economic decline of the PTA/COMESA region. For example, by the mid
1990s:
Gross domestic investment had fallen consistently for 20 years to a level
below a minimum investment ratio of the required 20% of GDP needed to
cover depreciation and repair costs; foreign direct investment (FDI) in
Africa was negligible, at approximately 1 per cent of GDP, representing
0.8 per cent of all FDI and 2.1 per cent of FDI going into all developing
countries.
The share of exports from sub-Saharan Africa in world exports declined
from 2.5% in 1970 to 1% in 1990, while its share in developing country
exports declined from 13.2% to 4.9% in the same period.
Ref : www.comesa.int

Changes in the Regional Economy


(Contd.)
External debt of the COMESA region had, by the early 1990s, increased
twenty-fold since 1970. Debt service ratios, which in 1970 were
insignificant, averaged 45 per cent of export earnings in 1989-90, making
the region one of the most heavily indebted in the world. The aggregate
external debt owed by sub-Saharan Africa, including South Africa, was
US$318 billion in 1994, compared to external financing to all African
countries of about US$15 billion in 1996.
Although industrial output grew in the 1960s and 1970s, this was followed
by a sharp decline as a result of entrenched structural rigidities, weak interindustry and inter-sectoral linkages, lack of access to advanced
technologies and poor institutional and physical infrastructure. The African
continent's share of world manufacturing value added (MVA) rose from 0.7
per cent in 1970 to 1 per cent in 1982 and fell to 0.8 per cent in 1994.

Ref : www.comesa.int

Changes in the Regional Economy


(Contd.)
Thus from 1960 up until the mid-1990s, the economic growth
of the COMESA region averaged 3.2 per cent a year, a figure
marginally above the level of the region's population growth.
By 1993, this region of about 280 million people then
(excluding Egypt), which had more than doubled its
population since independence, had a total GDP of around
US$90 billion, and included fifteen of the twenty-three States
classified as Least Developed Countries (LDC's) by the United
Nations.

Ref : www.comesa.int

What COMESA Offers


COMESA offers its members and partners a
wide range of benefits which include:

A wider, harmonised and more competitive market


Greater industrial productivity and competitiveness
Increased agricultural production and food security
A more rational exploitation of natural resources
More harmonised monetary, banking and financial
policies
More reliable transport and communications
infrastructure.
Ref : www.comesa.int

Aims and Objectives of the Common


Market
to attain sustainable growth and development of the Member
States by promoting a more balanced and harmonious
development of its production and marketing structures;
to promote joint development in all fields of economic activity
and the joint adoption of macro-economic policies and
programmes to raise the standard of living of its peoples and to
foster closer relations among its Member States;
to co-operate in the creation of an enabling environment for
foreign, cross border and domestic investment including the
joint promotion of research and adaptation of science and
technology for development;
Ref : www.comesa.int

Aims and Objectives of the Common Market


(Contd.)
to co-operate in the promotion of peace, security and stability
among the Member States in order to enhance economic
development in the region;
to co-operate in strengthening the relations between the
Common Market and the rest of the world and the adoption of
common positions in international fora; and
to contribute towards the establishment, progress and the
realisation of the objectives of the African Economic
Community

Ref : www.comesa.int

Fundamental Principles
equality and inter-dependence of the Member States;
solidarity and collective self-reliance among the Member
States;
inter-State co-operation, harmonisation of policies and
integration of programmes among the Member States;
non-aggression between the Member States;
recognition, promotion and protection of human and peoples'
rights in accordance with the provisions of the African Charter
on Human and Peoples' Rights;

Ref : www.comesa.int

Fundamental Principles (Contd.)


accountability, economic justice and popular participation in
development;
the recognition and observance of the rule of law;
the promotion and sustenance of a democratic system of
governance in each Member State;
the maintenance of regional peace and stability through the
promotion and strengthening of good neighbourliness; and
the peaceful settlement of disputes among the Member States,
the active cooperation between neighbouring countries and the
promotion of a peaceful environment as a pre-requisite for
their economic development.
Ref : www.comesa.int

Decision Making Process


COMESA has evolved a comprehensive decision making structure at
the top of which are the Heads of State of the 20 member countries.
There is then a Council of Ministers responsible for policy making,
12 technical committees and a series of other advisory bodies
(including specific relations with partner countries and the business
community).
In addition each member state appoints liaison persons in their
appropriate ministries who form part of the day-to-day
communication process.
Overall co-ordination is achieved through the Secretariat, based in
Lusaka, Zambia, who will be happy to deal with all initial
communication.

Ref : www.comesa.int

Free Trade Area


The FTA was achieved on 31st October, 2000 when nine of the
member States namely Djibouti, Kenya, Madagascar, Malawi,
Mauritius, Sudan, Zambia and Zimbabwe eliminated their
tariffs on COMESA originating products, in accordance with
the tariff reduction schedule adopted in 1992.
This followed a trade liberalisation programme that
commenced in 1984 on reduction and eventual elimination of
tariff and non-tariff barriers to intra- regional trade.

Ref : www.comesa.int

Free Trade Area


Burundi and Rwanda joined the FTA on 1st January 2004.
These eleven FTA members have not only eliminated customs
tariffs but are working on the eventual elimination of
quantitative restrictions and other non-tariff barriers.

Ref : www.comesa.int

Customs Union
A Customs Union maybe defined as a merger of two or more
customs territories into a single customs territory, in which
customs duties and other measures that restrict trade are
eliminated for substantially all trade between the merged
territories.
The territories, in turn apply the same duties and measures in
their trade with third parties.
In preparation for a Customs Union the Eleventh Meeting of
the Council of Ministers held in Cairo, Egypt adopted a Road
Map that outlined programmes and activities whose
implementation was necessary before the launching of the
Union.
Ref : www.comesa.int

Trade Promotion
The Member States shall adopt measures designed to promote trade within
the Common Market. In this regard, Member States shall :
ensure the development and dissemination of market intelligence and trade
information with a view to providing the widest possible knowledge-base of intraCommon Market trade opportunities and encourage the development of exports
and markets to meet the public and private procurement needs;
actively encourage the undertaking of supply and demand surveys, the organisation
of buyers and sellers meetings and other multi-country contact promotion events in
order to further identify and exploit the potential of intra-Common Market trade;
undertake the removal of measures that have been identified during the market
surveys, which restrict the flow of goods and services to their identified markets,
including the establishment of agency offices, trade missions, free movement of
samples and advertising;

Ref : www.comesa.int

Trade Promotion (Contd.)


The Member States shall adopt measures designed to promote trade
within the Common Market. In this regard, Member States shall :

identify the possibilities of product adaptation and diversification to


broaden their respective export base with a view to expanding or
introducing products to new markets in the Member States;
review and initiate programmes for the rationalisation and improvement
of import operations and techniques to ensure that savings will accrue
from such rationalisation of purchase operations;
seek to ensure that donor-funded import procurement programmes
allow as far as possible for the purchase of goods from other Member
States;
organise frequent general and specialised trade fairs;
Ref : www.comesa.int

Trade Promotion (Contd.)


The Member States shall adopt measures designed to promote trade within
the Common Market. In this regard, Member States shall :
improve the performance of small-and-medium scale enterprises for export
development such as marketing, business management and the provision of credits;
promote export-oriented joint ventures, by encouraging and facilitating enterprisetoenterprise contacts;
support privatisation endeavours through the introduction of trade services or
improvement of the trade promotion infrastructure to meet the special requirements
of privatised companies; and
encourage the improvement of services relating to trade such as export financing,
quality control and standardisation, packaging and specification aspects,
warehousing and storage operations, and others that will increase the flow of
goods within the Member States.

Ref : www.comesa.int

Trade Promotion (Contd.)


Other objectives which will be met to assist in the
achievement of trade promotion include:
Trade liberalisation and Customs co-operation, including the
introduction of a unified computerised Customs network
across the region.
Improving the administration of transport and communications
to ease the movement of goods services and people between
the countries.

Ref : www.comesa.int

Trade Promotion (Contd.)


Other objectives which will be met to assist in the
achievement of trade promotion include:
Creating an enabling environment and legal framework which
will encourage the growth of the private sector, the
establishment of a secure investment environment, and the
adoption of common sets of standards.
The harmonisation of macro-economic and monetary policies
throughout the region.

Ref : www.comesa.int

COMESA Programmes

Trade policy
Trade Facilitation
Multilateral Transport
Information Communication Technology
(ICT)
Energy
Private Sector Development
Investment Promotion
Gender Mainstreaming.
Ref : www.comesa.int

Trade, Customs and Monetary


Affairs
The final objective of cooperation in Trade, Customs and
Monetary Affairs is to achieve a fully integrated,
internationally competitive and unified single economic space
within which goods, services, capital and labour are able to
move freely across national frontiers.

Ref : www.comesa.int

Trade, Customs and Monetary Affairs


(Contd.)
Thus, the programme of cooperation aims to achieve the removal of all physical, technical, fiscal
and monetary barriers to intra-regional trade and commercial exchanges through the following
stages of integration:
A Preferential Trade Area (PTA) with lower tariffs applied to intra-regional trade originating in
member countries than to extra-regional trade.
A Free Trade Area (FTA), in which no tariffs are levied on goods from other member States
whilst each member State applies its own regime of tariffs to goods imported from outside the
region.
A Customs Union (CU) involving free trade amongst the member States but with a Common
External Tariff (CET) according to which every member State applies the same tariffs on
goods from outside the region.
A Common Market (CM) with free movement of capital and labour, considerable
harmonisation of trade, exchange rate, fiscal and monetary policies, internal exchange rate
stability and full internal convertibility.
An Economic Community (EU) with a common currency and unified macroeconomic policy.

Ref : www.comesa.int

COMESA Yellow Card Scheme


The COMESA Yellow Card is a motor vehicle insurance
scheme which is valid in all the participating countries.
It covers third-party liabilities and medical expenses for the
driver of the vehicle and his passengers should they suffer
any bodily injury as a result of an accident to an insured
vehicle.
It also facilitates cross border movement of vehicles
between COMESA member countries.
As this card is valid in many parts of the region,
transporters and motorists do not have to buy insurance
cover at each border post they cross.
Ref : www.comesa.int

COMESA Yellow Card Scheme


(Contd.)
For example, if a Kenyan motorist wishes to drive to Harare,
Zimbabwe, he will purchase a Yellow Card from an insurance company
in Kenya for the required period of time and to cover the countries he
will travel through.
If on his way to Zimbabwe he is involved in an accident in Malawi all
he will be required to do is to report to the Malawian Yellow Card
National Bureau, which is the focal point (often an insurance company)
representing all the insurance companies issuing Yellow Cards, and the
traffic police.
The National Bureau will then handle and settle the claim arising from
this accident.
Therefore, if his vehicle is in a roadworthy state the motorist is then
free to continue his journey to Zimbabwe.
Ref : www.comesa.int

COMESA Yellow Card Scheme


(Contd.)
The scheme is currently operational in Burundi, Democratic
Republic of Congo, Eritrea, Ethiopia, Kenya, Malawi,
Rwanda, Uganda, Tanzania, Zambia and Zimbabwe. About
150 insurance companies are involved in the operation of the
scheme and issue about 50,000 cards annually.

Ref : www.comesa.int

Infrastructure
COMESA has recognized infrastructure development as a
priority and strategic focus area that requires special
attention.
The Strategic Objective to be pursued is, therefore, to
effectively address constraints related to the improvement
of infrastructure and services in the region in order to
reduce the cost of doing business and also and to enhance
competitiveness, through fostering physical regional
connectivity and deepening infrastructure integration.

Ref : www.comesa.int

Infrastructure (Contd.)
A holistic and corridor based approach to infrastructure
development has been adopted s based on three key pillars
i.e. policy and regulatory harmonization, development of
priority regional physical infrastructure covering transport,
information communications technologies (ICT) and energy.
The transport sector covers civil aviation, surface transport
(covering road and rail) and water transport covering
maritime and inland water transport subsectors
The ICT comprises telecommunications, broadcasting and
postal services subsectors, whilst Energy covers electricity,
fossil fuels and renewable energy subsectors.
Ref : www.comesa.int

Infrastructure (Contd.)
A number of key strategies have been adopted in order to achieve the
infrastructure strategic objective indicated before. They include the
following:
Development and revision of model policies and regulations (for
Transport, ICT, and Energy);
Development of aid for trade programs along the major regional
corridors including the establishment of One Stop Border Posts
(OSBPs);
Development of legal and institutional frameworks for public private
sector partnerships in order to increase the private sector participation in
infrastructure development; and
Implementation of a communication strategy for the dissemination of
information on development of infrastructure projects to all stakeholders.
Ref : www.comesa.int

COMESA Agricultural
Programmes
COMESA Member States are cognizant of the critical
role that agriculture plays in their national economies.
Agriculture is considered to be the engine for
economic development in the COMESA region.
The sector accounts for more than 32 per cent of
COMESA's gross domestic product (GDP), provides
a livelihood to about 80 per cent of the region's
labour force, accounts for about 65 per cent of foreign
exchange earnings and contributes more than 50 per
cent of raw materials to the industrial sector.
Ref : www.comesa.int

COMESA Agricultural Programmes


(Contd.)
The objectives of the COMESA Treaty and the COMESA
Agricultural Policy (CAP) are in line with the broader
Comprehensive African Agricultural Development
Programme (CAADP) of the New Partnership for Africa's
Development (NEPAD) under the African Union (AU).
The CAADP has been endorsed by African Heads of
State and Governments as a framework for the restoration
of agricultural growth, food security and rural
development in Africa within an integrated and
coordinated approach.
Ref : www.comesa.int

COMESA Agricultural Programmes


(Contd.)
CAADP defines four Pillars for improving Africa's
agriculture:
Extending the area under sustainable land management
and reliable water control systems;
Improving rural infrastructure and trade related
capacities for market access;
Increasing food supply, reducing hunger and
improving responses to food emergency crises; and
Improving agricultural research, technology
dissemination and adoption.
Ref : www.comesa.int

COMESA Agricultural Programmes


(Contd.)
The overall African Union vision for agriculture is that the Continent by the year 2015 should:
Improve the productivity of agriculture to attain an average annual production growth rate
of 6%, with particular attention to small-scale farmers, especially women;
Have dynamic agricultural markets within countries and between regions;
Have integrated farmers into the market economy and have improved access to markets to
become a net exporter of agricultural products taking into account Africa's comparative and
competitive advantage;
Achieved a more equitable distribution of wealth as a result of rising real incomes and
relative wealth for rural populations through more equitable access to land, physical and
financial resources, and the knowledge, information and technology for sustainable
development;
Be a strategic player in agricultural science and technology development to meet growing
needs and demands of African agricultural development;
Practice environmentally sound production methods and have a culture of sustainable
management of the natural resource base through increased knowledge, information and
technology application.

Ref : www.comesa.int

Other Activities / Programme

Information and Networking Division


Science and Technology
Legal Division
Peace and Security
Budget and Finance Division
Gender and Social Affairs Division

Ref : www.comesa.int

COMESA Institutions
Several institutions have been created to promote sub-regional co-operation
and development. These include:

The COMESA Trade and Development Bank in Nairobi, Kenya


The COMESA Clearing House in Harare, Zimbabwe
The COMESA Association of Commercial Banks in Harare, Zimbabwe
The COMESA Leather Institute in Ethiopia
The COMESA Re-Insurance Company (ZEP-RE) in Nairobi, Kenya

In addition a Court of Justice was also established under the COMESA


Treaty and became formally operational in 1998.
Further initiatives exist to promote cross border initiatives, form a common
industrial policy and introduce a monetary harmonisation programme.

Ref : www.comesa.int

Security and Other Restrictions to


Trade
A Member State may, after having given notice to the Secretary-General
of its intention to do so, introduce or continue or execute restrictions or
prohibitions affecting:
the application of security laws and regulations;
the control of arms, ammunition and other war equipment and military
items;
the protection of human, animal or plant health or life, or the protection
of public morality;
the transfer of gold, silver and precious and semi-precious stones;
the protection of any item deemed to be of national importance
provided that the Member State concerned shall furnish proof to the
Council that the item is of national importance; and
the maintenance of food security in the event of war and famine.
Ref : www.comesa.int

Security and Other Restrictions to Trade


(Contd.)
A Member State shall not so exercise the right to introduce or
continue to execute the restrictions or prohibitions conferred
by this Article as to stultify the free movement of goods
envisaged in this Chapter [6(50)].
Security and other restrictions imposed in accordance with
paragraph 1 of this Article shall not extend for more than is
necessary to achieve security aims and other risks intended to
be eliminated and shall be applied on the basis of nondiscrimination.

Ref : www.comesa.int
Ref : www.comesa.int

COMESA

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