News / Economy

African Union Pushing for More Intercontinental Trade

Laborers work at a railway station construction site in Ethiopia's capital Addis Ababa, Sept. 16, 2013.
Laborers work at a railway station construction site in Ethiopia's capital Addis Ababa, Sept. 16, 2013.
Marthe van der Wolf
Both the African Union and the U.N. Economic Commission for Africa (UNECA) have held countless meetings and conferences on increasing intra-Africa trade. Efforts so far, however, have not translated into results.
 
How intra-Africa trade can be improved is one of the most discussed topics at the AU and UNECA. African countries do only 11 percent of their foreign trade with other countries on the continent. In comparison, Asian countries do 50 percent of their trade with each other, while European Union countries do 70 percent.
 
UNECA Regional Integration and Trade Division Director Stephen Karingi said several conferences during the past decades were needed to find common positions.
 
“They have had to come up with common positions on their discussions, negotiations with bilateral partners, for instance the European Union. But much more importantly, they had to come and agree on what they need to do as sub-regions in the context of deepening regional integration through the regional economic communities,” said Karingi.

World Bank urges changes

A 2012 World Bank report says the continent loses billions of dollars annually because of continental trade barriers. A U.N. report on intra-Africa trade released in July, urges African governments to boost the private sector, reduce trade barriers and expand infrastructure.
 
The slow progress makes it difficult for businesses to tap markets in surrounding countries.  

The Jittu Horticulture company is Ethiopia’s biggest exporter in its sector. General Manager Jan Prins said Ethiopia has huge trade opportunities, but that there are too many challenges when trying to trade with neighboring countries.
 
“The major challenge is to reach these markets. And it can either be logistic problems like over flooded border areas, bad roads or no roads, trade barriers, political issues or security issues," Prins said. "For Ethiopia it is very difficult to reach the markets in the surrounding countries.”

Poor infrastructure, visa difficulties, corruption and extremely high transportation costs are just some of the barriers companies face when trying to trade within the continent. A truck in Africa will, on average, only travel nine kilometers an hour because of the many checkpoints. Therefore, transport costs make up 40 percent of a product's price.

Diversity of trade

Intra-Africa trade, both imports and exports, amounted to $131 billion in 2011. UNECA's Karingi said this number could grow as trade within the continent is much more diverse than trade with countries outside the continent.
 
“If you take the top five products that, say Ghana, trades with the rest of the world and you compare that with the top five that Ghana trades with the rest of Africa, you will find that four out of five of the commodities, tariff lines, that Ghana trades with Africa are actually value added. Whereas five out of five of the trades with the rest of the world, there is no value addition. And you can repeat the same stories on other countries,” said Karingi.

African Union countries have agreed to make the continent a free trade zone by 2017. African Union Trade and Industry Department Director Treasure Maphanga said it is up to governments to make the goal of a continental free trade zone a reality.

“In many countries there is political will that exists at a certain level. Intra-Africa trade does not just depend on one ministry, it does not just depend on the head of state. It depends on the whole government machinery.  And coordinating toward a specific goal,” said Maphanga.

The African Union will hold another conference on how to improve trade within the continent at the end of October.

You May Like

Photogallery Snowstorm Sweeps Northeastern US

'This is nothing like we feared it would be,' New York City Mayor Bill de Blasio says; he had earlier warned storm could be one of worst the city has ever faced More

Millions of Displaced Nigerians Struggle With Daily Existence

Government acknowledges over a million people displaced in 2014 due to fight against Boko Haram insurgency More

Facebook: Internal Error to Blame for Outages

Temporary outage appeared to spill over and temporarily slow or block traffic to other major Internet sites More

This forum has been closed.
Comment Sorting
Comments
     
by: Tom from: Texas
October 01, 2013 7:55 AM
Intra Africa trade will only work if is roads that link each country to one another and less border restrictions.

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
Obama Urges Closer Economic Ties During Historic India Visiti
X
Aru Pande
January 26, 2015 9:33 PM
U.S. President Barack Obama says the United States and India must do better to capitalize on untapped potential in their economic relationship - by removing some of the roadblocks to greater trade and investment. As VOA correspondent Aru Pande reports from New Delhi, Obama spoke after participating in India’s Republic Day celebration.
Video

Video Obama Urges Closer Economic Ties During Historic India Visit

U.S. President Barack Obama says the United States and India must do better to capitalize on untapped potential in their economic relationship - by removing some of the roadblocks to greater trade and investment. As VOA correspondent Aru Pande reports from New Delhi, Obama spoke after participating in India’s Republic Day celebration.
Video

Video US, EU Threaten New Russia Sanctions Over Ukraine

U.S. President Barack Obama has blamed Russia for an attack by Ukrainian separatists that left dozens dead in the port of Mariupol and cast further doubt on the viability of last year’s cease-fire with the Kyiv government. VOA’s Michael Bowman reports from Washington.
Video

Video White House Grapples With Yemen Counterterrorism Strategy

Reports say the U.S. has carried out a drone strike on suspected militants in Yemen, the first after President Barack Obama offered reassurances the U.S. is continuing its counterterrorism operations in the country. The future of those operations has been in question following the collapse last week of Yemen’s government. VOA White House correspondent Luis Ramirez reports.
Video

Video Kerry Warns Against Violence in Nigeria Election

US Secretary of State John Kerry visited Nigeria Sunday in a show of the level of concern within the U.S. and the international community over next month’s presidential election. Chris Stein reports.
Video

Video Zoo Animals Show Their Artistic Sides

The pursuit of happiness is so important, America's founding fathers put it in the Declaration of Independence. Any zookeeper will tell you animals need enrichment, just like humans do. So painting, and even music, are part of the Smithsonian National Zoo's program to keep the animals happy. VOA’s June Soh met some animal artists at the zoo in Washington. Faith Lapidus narrates.
Video

Video Worldwide Photo Workshops Empower Youth

Last September, 20 young adults from South Sudan took part in a National Geographic Photo Camp. They are among hundreds of students from around the world who have learned how to use a camera to tell the stories of the people in their communities through the powerful medium of photography. Three camp participants talked about their experiences recently on a visit to Washington. VOA’s Julie Taboh reports.
Video

Video Saudi, Yemen Developments Are Sudden Complications for Obama

The death of Saudi Arabia's King Abdullah and the collapse of Yemen’s government have cast further uncertainty on U.S. efforts to fight militants in the Middle East and also contain Iran’s influence in the region. VOA White House correspondent Luis Ramirez reports on the new complications facing the Obama administration and its Middle East policy.
Video

Video Progress, Some Areas of Disagreement in Cuba Talks

U.S. and Cuban officials are reporting progress from initial talks in Havana on re-establishing diplomatic ties. U.S. Assistant Secretary of State (for Western Hemisphere Affairs) Roberta Jacobson said while there was agreement on a broad range of issues, there also are some “profound disagreements” between Washington and Havana. VOA State Department correspondent Pam Dockins has the story.
Video

Video US, Japan Offer Lessons as Eurozone Launches Huge Stimulus

The Euro currency has fallen sharply after the European Central Bank announced a bigger-than-expected $67 billion-a-month quantitative easing program Thursday - commonly seen as a form of printing new money. Henry Ridgwell reports for VOA from London on whether the move might rescue the eurozone economy -- and what lessons have been learned from similar programs around the world.
Video

Video Nigerian Elections Pose Concern of Potential Conflict in 'Middle Belt'

Nigeria’s north-central state of Kaduna has long been the site of fighting between Muslims and Christians as well as between people of different ethnic groups. As the February elections approach, community and religious leaders are making plans they hope will keep the streets calm after results are announced. Chris Stein reports from the state capital, Kaduna.
Video

Video As Viewership Drops, Obama Puts His Message on YouTube

Ratings reports show President Obama’s State of the Union address this week drew the lowest number of viewers for this annual speech in 15 years. White House officials anticipated this, and the president has decided to take a non-traditional approach to getting his message out. VOA White House correspondent Luis Ramirez reports.
Video

Video S. Korean Businesses Want to End Trade Restrictions With North

Business leaders in South Korea are calling for President Park Geun-hye to ease trade restrictions with North Korea that were put in place in 2010 after the sinking of a South Korean warship.Pro-business groups argue that expanding trade and investment is not only good for business, it is also good for long-term regional peace and security. VOA’s Brian Padden reports.

Circumventing Censorship

An Internet Primer for Healthy Web Habits

As surveillance and censoring technologies advance, so, too, do new tools for your computer or mobile device that help protect your privacy and break through Internet censorship.
More

All About America

AppleAndroid

World Currencies

EUR
USD
0.8893
JPY
USD
118.31
GBP
USD
0.6660
CAD
USD
1.2459
INR
USD
61.427

Rates may not be current.