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Will Africa’s mega trade bloc take off?

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Three African trading blocs comprising some 527 million people and with an estimated gross domestic product of $624 billion, have agreed to move towards a free trade area. It would span 26 countries from Egypt to South Africa, and would go a long way towards streamlining some of the continent’s numerous trading blocs. Africa is home to some 30 regional trade arrangements, and on average each nation belongs to about four groups, according to international financial institutions. This has led to conflicting and overlapping agreements.

So in a move to ease some of these issues, heads of state who chair the Common Market for Eastern and Southern Africa (COMESA), East African Community (EAC), and the Southern African Development Community (SADC),  met in the Ugandan capital to draw up a pact on integration, and eventually hoping to have a unified customs union. Ugandan President Yoweri Museveni said at the meeting’s opening that: “The greatest enemy of Africa, the greatest source of weakness has been disunity and a low level of political and economic integration.” The meeting’s final communiqué said a timeframe for integration would be considered in one year. Rwandan President Paul Kagame cautioned delegates that African nations must make sure to enforce the protocols and treaties that they’ve adopted. Heads of state at the meeting stressed the need to create economies of scale, bigger markets equal more opportunities to grow, they said.

But many of the existing blocs have already run into trouble. The EAC’s integration, for example, has had some hiccups because some member countries felt their economies would be dominated by neighbours.

So, should Africa think bigger and bigger or try to work on existing institutions? Do you think the creation of a free trade zone spanning COMESA, SADC and the EAC will take off, or will it just remain on the drawing board? What do you see as the major challenges in implementing this agreement?

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