Africa’s Free Trade Agreement: An empty gesture, or the next step in South Africa’s neo-colonisation of Africa?


(Courtesy of Yahoo News)

I got very excited when I read the headlines. “Africa signs deal for Free Trade Area”. “Free Trade Area Treaty Signed”. “Free Trade Deal to Boost Trade, Investment in Africa.”

The terms of the “deal” were even more exciting. Three of Africa’s largest and most efficient trading blocs (SADC, COMESA and the EAC), comprising 26 countries, more than half a billion people, and a little shy of a combined GDP of a trillion dollars (US, not Zimbabwean), were to merge, eliminating tariffs, quotas and preferences on goods traded between them.

This would be a huge step in the economic development of Africa. Trade within Africa is notoriously low (only about 10% of Africa’s trade is with itself, as compared to 60% in Europe), and beset with all sorts of difficulties – most notably high tariffs on goods and very poor infrastructure.  By removing some of these obstacles, it makes it easier to trade, encouraging the development of a manufacturing sector and creating jobs.

But read the fine print, and its becomes clear that the agreement is not to establish a Free Trade Area but merely to talk about establishing a Free Trade Area. It is an agreement to negotiate, and South Africa’s Trade Minister Rob Davies doesn’t expect any progress for three years, saying that even though the heads of state “thought an inordinate amount of time was needed to do this, they still allocated 36 months to do so.”

The negotiations are being spearheaded by South Africa – the agreement was signed in Johannesburg and presided over by Jacob Zuma. While a Free Trade Area is hugely important for Africa’s development, the rest of the continent needs to be wary that South Africa doesn’t use its huge clout to create provisions that favour its own development rather than Africa’s. After all, South Africa has the most to gain with any free trade agreement because it’s able to take immediate advantage. I have a horrible suspicion that if substantive negotiations take place, and a real agreement signed, it will represent of triumph of South Africa’s neo-colonial foreign policy (the policy that is filling the continent with Shoprites and Nandos the way America filled with world with McDonalds and Coca-Cola) rather than a a genuine attempt at African economic reform. Not that the two are necessarily mutually exclusive. And, I’d take Nandos over McDonalds every day of the week.

It will be interesting to see if there will be parallel negotiations on free movement of people, a much more delicate topic, and something South Africa, with its domestic problems around xenophobia, will be less in favour of.

VERDICT: The African Free Trade Area goes forth. As a first step, this is encouraging; however, until we hear something more concrete it remains mere PR.

Advertisements

2 Comments

Filed under Forth

2 responses to “Africa’s Free Trade Agreement: An empty gesture, or the next step in South Africa’s neo-colonisation of Africa?

  1. Neo-colonialist foreign policy? Hardly! I do however agree that the true test of this may be in taking a wait and see approach to see if this isn’t just political gesturing from South Africa. The truth, is whether we like it or not, the South African Business Comminity is one of the better placed if not best placed business community to drive African economic development, which in practical terms means that South African Firms will be “first to the market” in a sense, this however is much more desirable than the very real economic colonization that China is driving.

    • Absolutely. SA is certainly in the pound seats in terms of driving Africa’s development, and its model is infinitely preferable to China’s (whose economic involvement in Africa has been greatly exaggerated, in my opinion). Nonetheless, SA needs to bring Africa’s economies up with it in order to guarantee its markets for the future.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s