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Examining free trade agreements (FTAs) and boosting intra-regional trade

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Examining free trade agreements (FTAs) and boosting intra-regional trade

Nicholas Tate, Managing Director, Tate Freight Forms Ltd.
www.just-trade.co.uk

  • In considering the positives and negatives of key agreements, are trade blocs, bilateral agreements and FTAs a facilitator or a hindrance to intra-regional trade in Africa?
  • African regional trade has some of the worst indicators in doing business, such as the highest volume of documents needed, the longest time to export, and the highest costs of importing/exporting:
    Is this a banking or policy issue?
  • Improving infrastructure/logistics, restructuring cross-border tariffs/taxes, changing cultural mind sets: What are the biggest hurdles to increasing intra-regional trade in Africa?


Nicholas started by giving an overview of Just Trade and Tate Freight Forms which was started in 1981and has served the needs of international traders, exporters and importers and freight companies. This year they launched a new online service called Just trade which aims to make international trade accessible to all businesses. Just Trade deliver software applications for export, freight and government and publish information on rules of exporting to different markets around the world and their products are British Chamber of Commerce approved.

He has overseen business expansion through the development of partner programmes with several leading Chambers of Commerce – including Cambridgeshire COC and East Midlands COC – and well-known forex provider, Western Union Business Services. He has been instrumental in the development of the Tradex Export Documentation platform; working alongside established exporting businesses (like John Hogg and Thales Group UK) to create solutions that speed up completion of repetitive tasks whilst improving document acceptance rates.

On inter-regional trade, Nicholas said that countries within the East African Community have been improving relations with each other and have made progress on tariff production, however, overall regional trade has not improved as a propotion of total trade, it is believed that the reason is due to the prevalence of non-tarrif barriers.

In 2017 the Uganda Government set a target to triple Exports in 3 years. Exports were worth $2.3 billion in 2017 and by 2020 the total should grow to $8bn. Nicholas noted.

Nicholas further stressed that the way to achieve a more diverse economy is through the development of regional trade.

These estimates of informal cross-border trade suggest that the true figure for the proportion of intra-African trade relative to total trade is higher than the official figure of around 11 per cent.
In 2009 and 2010 Ugandan informal exports to its neighbours were worth $790 million and $520 million respectively.

Intra-Regional African trade between 1995 to 2011 has been at its lowest comparing to other markets like Asian and is quite a long way.

  • What should free trade agreements achieve?
  • There is a need to create a custom Union where goods should travel freely within the region
  • Elimination of tariff and non-tariff barriers
  • Greater market opportunities
  • Bring down the cost of goods and improve welfare
  • Improvement of Infrastructure (transportation, power)
  • Access to finance

Infrastructure investments like the northern corridor and the standard gauge railway will bring down transport costs.

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