African leaders agree Free Trade Area to boost trade
Addis Ababa, Ethiopia (PANA) - African leaders have resolved to pursue banking reforms, a Free Trade Area for the entire continent in five years (2017), and the modernization of rail, air and road transport to boost trade.
Rising from their 18th Summit in Addis Ababa, Ethiopia, they also agreed to seek international financial support to implement an ambitious US$78 billion plan for major infrastructure projects, to connect the continent for ease of trade and to fight off effects of an economic decline.
“There should be an overall resource mobilization domestically to develop infrastructure and work towards innovative sources of financing,” said the African Union (AU) Chairman Yayi Boni.
Stung by the failure of the continent to rise above grueling poverty levels, the leaders said although most countries were able to record over 6% of gross domestic product growth, the rate was too low to have sustained effects on poverty.
Ethiopian Prime Minister Meles Zenawi, currently the chair of the New Partnership for Africa’s Development (NEPAD), was mandated to lead a 7-member heads of state committee, called the
“High Level African Trade Committee'', to look into ways of raising the funds required.
The leaders agreed to seek new sources of funds, drawn from taxation of aid money in the continent, taxes from minerals and mining deals and revenues drawn from dealings with banks within Africa as well as multilateral bodies, to fund the trade boost.
“We are determine to address the issue of stability and lead to the prosperity of our continent,” President Boni said. “We have to ensure growth rate is higher above the population growth in Africa.”
During the Summit, dedicated to boosting trade in Africa, the leaders affirmed commitment to the acceleration and deepening of Africa’s markets.
They also called for efforts to promote the industrialization of Africa, through measures such as curbing raw material exports, improving the manufacturing capability in most countries and diversifying the economies to stop relying on export commodities.
President Boni said countries agreed to create an enabling environment for trade and infrastructure growth.
“We need Information, Technology and Communication (ICT), energy support and air transport systems to bring states together and encourage the regional economic blocs to come together,” the Beninese leader said.
In the Summit declaration, the leaders reached an agreement that the 7-member heads of state panel would present a workable plan on boosting Intra-African Trade.
They also agreed on the consolidation of ongoing efforts to integrate economies in Eastern and Southern Africa and a plan to push those efforts through to 2017.
The AU, the Economic Commission for Africa (UNECA) and the African Development Bank were mandated to carry out studies to inform debate on the implementation of the road map to a Free Trade Area.
In their brief road map to a continental Free Trade Area, the leaders said the finalization of the East African Community (EAC), the Common Market for Eastern and Southern Africa (COMESA) and the Southern Africa Development Community (SADC) efforts to unite their economies, should be completed within two years.
They decreed that other regional blocs should proceed to finalise the Free Trade Areas on a parallel basis within two years and consolidate the continental Free Trade Area.
-0- PANA AO/SEG 31Jan2012
