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

Captured IS Militants Explain Why They Fought

Fighters from Turkey, Syria tell VOA Kurdish Service what drew them to extremism, jihad More

Security Experts Split on Kenyan Barrier Wall

Experts divided on whether initiative aiming to keep out al-Shabab militants is long-awaited solution or misguided effort More

Video Philippines Wants Tourists Spending Money at New Casinos

Officials say they hope to turn Manila into the next Macau, which has long been Asia’s gambling hub 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.
Liberia's Almost Last Ebola Patient Grateful but Still Grievingi
X
Benno Muchler
March 26, 2015 3:41 PM
Beatrice Yardolo was to make history as Liberia’s last Ebola patient. Liberians recently started counting down 42 days, the period that has to go by without a single new infection until the World Health Organization can declare a country Ebola-free. That countdown stopped on March 20 when there was another new case of Ebola, making Yardolo’s story a reminder that Ebola is far from over. Benno Muchler reports from Monrovia.
Video

Video Liberia's Almost Last Ebola Patient Grateful but Still Grieving

Beatrice Yardolo was to make history as Liberia’s last Ebola patient. Liberians recently started counting down 42 days, the period that has to go by without a single new infection until the World Health Organization can declare a country Ebola-free. That countdown stopped on March 20 when there was another new case of Ebola, making Yardolo’s story a reminder that Ebola is far from over. Benno Muchler reports from Monrovia.
Video

Video Cambodian Land Grabs Threaten Traditional Communities

Indigenous communities in Cambodia's Ratanakiri province say the government’s economic land concession policy is taking away their land and traditional way of life, making many fear that their identity will soon be lost. Local authorities, though, have denied this is the case. VOA's Say Mony went to investigate and filed this report, narrated by Colin Lovett.
Video

Video US, South Korea Conduct Joint Military Exercises

The Eighth U.S. Army Division and the Eighth Republic of Korea Mechanized Infantry Division put on a well orchestrated show of force for the media this week during their joint military training exercises in South Korea. VOA’s Seoul correspondent Brian Padden was there and reports the soldiers were well disciplined both in conducting a complex live fire exercise and in staying on message with the press.
Video

Video Space Program Status Disappoints 'Last Man on the Moon'

One of the films that drew big crowds last week at the annual South by Southwest festival in Austin, Texas, tells the story of the last human being to stand on the moon, U.S. astronaut Eugene Cernan. It has been 42 years since Cernan returned from the moon and he laments that no one else has gone there since. VOA’s Greg Flakus reports.
Video

Video Young Filmmakers Shine Spotlight on Giving Back

A group of student filmmakers from across the United States joined President Barack Obama at the White House this month for the second annual White House Student Film Festival. Fifteen short films were officially selected from more than 1,500 entries by students aged 6 through 18. The filmmakers and their families then joined the president and a group of celebrities for a screening of their films. VOA’s Julie Taboh reports.
Video

Video VOA Exclusive: Interview with Afghan President Ashraf Ghani

Afghan President Ashraf Ghani, during his first visit as president to Washington, gave a one-on-one interview with VOA Afghan Service reporter Said Suleiman Ashna, about his request for a change in U.S. troop levels, the threat from the Islamic State, and repairing relations with the United States and Pakistan. The interview was held at Blair House, late Sunday, in Pashto.
Video

Video California Science Center Tells Story of Dead Sea Scrolls

The ancient manuscripts were uncovered in the mid-20th century, and they are still yielding clues about life and religious beliefs in ancient Israel. As VOA's Mike O'Sullivan reports, an exhibit in Los Angeles shows how modern science is bringing the history of these ancient documents to life.
Video

Video Angelina Jolie Takes Another Bold Step

Hollywood actress and filmmaker Angelina Jolie has revealed she had her ovaries and fallopian tubes removed to lower her odds of getting cancer. Doctors say the huge publicity over her decision will help raise awareness about the importance of cancer screening. VOA’s George Putic has more

All About America

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

World Currencies

EUR
USD
0.9103
JPY
USD
119.37
GBP
USD
0.6704
CAD
USD
1.2481
INR
USD
62.371

Rates may not be current.