NDS 1 positions Zim for increased AfCFTA benefits

Government expects the successful rollout of the National Development Strategy (NDS1 2021-2025) to position the country on a favourable footing to tap into the lucrative opportunities under the African Continental Free Trade Area (AfCFTA) Agreement.

The NDS1 is the country’s first five-year medium term plan aimed at realising the country’s Vision 2030, of having a “Prosperous & Empowered Upper Middle Income Society by 2030”.

The strategy identifies a number of strategies to influence the country’s international trade policy as part of external sector stability.

In order to consolidate external sector stability, the Government has said that a combination of export orientation and import substitution strategies will be prioritised during the strategy period, particularly where the country has competitive advantage.

In remarks yesterday during a high-level digital forum to demystify the AfCFTA for women-led entrepreneurs in Zimbabwe and Southern Africa, Foreign Affairs and International Trade Deputy Minister, David Musabayana, said regional economic integration was important to Zimbabwe and Africa’s development given its potential to boost intra-African trade and bringing about economic and political benefits to the African countries.

The continent commenced trading under the AfCFTA on 1 January 2021. The historic deal is one of the African Union’s flagship projects under Agenda 2063: “The Africa We Want”.

Experts say the agreement provides a clear framework that creates business opportunities within the African countries, as well as supporting integration into broader regional and continental value chains.

“Government is confident that the implementation of the AfCFTA will assist the country and the continent in recovery following the economic downturn induced by the novel coronavirus.

“We are optimistic that the NDS1 will contribute to the implementation of the AfCFTA,” said the Deputy Minister.

“In fact one of the objectives of the recently launched National Development Strategy 1 is to ‘rebalance the economy through increasing the contribution of value-added exports to total exports from 9 percent in 2020 to 20 percent in 2025’.”

The Government, the International Trade Centre (ITC) and the Organisation of Women in International Trade (OWIT) Zimbabwe Chapter jointly organised the forum, which drew a diversity of business expert audiences and development partners. The platform discussed several topics of interest related to micro, small and medium sized enterprises (MSMEs) competitiveness, intra-African trade opportunities and challenges, faced specifically by the Zimbabwean private sector.

To ensure women traders and entrepreneurs, including micro-entrepreneurs, benefit from expanded trade under the AfCFTA, the Deputy Minister said the Government will scale up existing trade-related technical assistance for women and youth-owned SMEs to help them improve their capacity to trade.

He commended African Heads of States for demonstrating strong political will, leadership and ownership of the AfCFTA by operationalising the Agreement despite the setbacks caused by the Covid-19 pandemic.

The AfCFTA Agreement, which has so far been signed by 54 out of 55 countries and ratified by 36 countries including Zimbabwe will be the world’s largest free trade area in terms of participating countries, since the formation of the World Trade Organization (WTO).

Estimates from the Economic Commission for Africa (UNECA) suggest that the AfCFTA has the potential to boost intra-African trade by over 50 percent through elimination of import duties.

The AfCFTA will bring together all 55 member States of the African Union covering a market of more than 1.2 billion people and a combined gross domestic product (GDP) of more than US$3.4 trillion.

The AfCFTA involves the easing of trade restrictions for trade in goods and services among the rest of African countries.

“This will make it easy for local companies to export and access more raw materials for products that meet the agreed rules of origin,” said Musabayana.

“Clearly, companies exploiting the AfCFTA market should no doubt enjoy huge benefits from economies of scale.”

Delegates to the forum stressed the need to undertake deliberate actions for the trade agreement to deliver its transformative economic potential and expected outcomes in order to realise the benefits from the trade agreement.

As the Government takes steps to prepare for implementation of the AfCFTA, local industries have also been urged to boost output so that the country can fully benefit from the AfCFTA Agreement.

The Government has pledged to continue finetuning reforms to create a conducive environment for businesses to take advantage of the AfCFTA and other trade agreements that the country is Party to.

This includes addressing existing infrastructure deficiencies and operational arrangements at some border posts, which have been blamed for fuelling inefficiencies, which cost the economy.-ebusinessweekly.c.zw