FRIDAY June 10, 2022
African leaders gather at the March 2018 African Union Summit in Kigali, Rwanda, to sign an agreement to create the African Continental Free Trade Area. It was officially launched in July 2019. PHOTO | GIS REPORTS ONLINE
By Patty Magubira
The Tranquility News Reporter, Tanzania
The Tanzania government has dared African engineers to come up with a proposal for opening up African skies in a bid to increase air traffic volumes, connectivity and to lower fares.
Connectivity should be one of the priorities of the African Continental Free Trade Area (AfCFTA), Ms Liberata Mulamula, the Tanzania’s Minister for Foreign Affairs and East African Cooperation, told a high-level meeting of the AfCFTA.
Monopoly was to blame for air travel to still be considered luxury in Africa, as unfriendly regulatory policies are discouraging competition in the aviation sector, she said.
The minister cautioned that without connectivity, neither the ‘Africa We Want’ rhetoric stipulated in the continent’s 2063 Vision nor the AfCFTA would be realised.
“Some of us are at our eleventh hour, but we want to leave behind a legacy that we made it, and we can do it,” she stressed, adding:
“It took me two days from Dar es Salaam (Tanzania) to Malabo (Equatorial Guinea), how do we do trade when we cannot connect? This is a challenge to all of you.”
Besides taking long time to reach Malabo, the cost was higher than flying from Dar es Salaam to the US.
The Chairman of the East African Business Council (EABC), Mr Nicholas Nesbitt, also observed that it was cheaper for him to drive from Nairobi, Kenya, to Arusha than to fly.
“There are no enough flights and it is also extremely expensive. I wish we had cheaper flights between our different countries,” he said as he called on the public sector to consider addressing challenges between states.
Indeed, one of the main challenges in the region is poor transport infrastructure hindering swift movement, increasing costs of doing business and limiting investment.
While some believe improvement in air service from liberalisation would lead to savings in time and ultimately catalyse trade and investment, others fear the move would benefit capitalised foreign carriers which would squeeze out smaller and less-funded local carriers.
The proponents of an open sky policy see the introduction of the great competition as an opportunity for not only offering existing carriers a new market and investment, but also encouraging them to become efficient.
A research carried out by InterVista and East Africa Research Fund in collaboration with the UK Aid and the East African Community (EAC) in 2016 reveals that the open sky policy would lower fares by 9 per cent and increase traffic by 41 per cent if it was implemented in the region.
The policy would, in addition, create 46,320 jobs and contribute $202.1 million to the gross domestic product, equivalent to 0.6 per cent of the total GDP of the partner states then.
Besides the aviation industry, the policy would also contribute to trade and tourism, inward investment, productivity growth, increased employment and economic growth.
Ms Mulamula was officiating at the 2nd Coordination Meeting of the heads of the regional economic communities (RECs) on the implementation of the AfCFTA at the East African Community (EAC) headquarters in Arusha, Tanzania, recently.
The meeting aimed at, among other things, borrowing a leaf from the book of the RECs free trade areas and customs unions to prepare actionable strategies towards enhancing effective implementation of the AfCFTA.
The African Union Heads of State Summit directed in 2017 that the AU Commission, RECs, regional mechanism, member states and other continental institutions should convene, collaborate and work together to enhance complementarity, synergies and alignment of their work programmes and activities to facilitate the implementation of the AfCFTA.
“Without the private sector there will be no AfCFTA, our role as AfCFTA and RECs secretariats is to facilitate trade driven by the private sector,” the AfCFTA Secretary General, Mr Wamkele Mene, said.
He said industrial development statistics indicated that all 55 countries on the continent contributed 2.1 per cent to the global trade and 3 per cent to the world’s GDP as opposed to 6.2 per cent input of Singapore alone.
Mr Mene blamed the Africa’s poor performance on lack of industrial development and capacity on the continent.
Mr Mene said he saw the declining challenge from the COVID-19 pandemic and the ongoing Ukraine crisis as pointing out one thing: The need for Africa to accelerate industrial development and eliminate barriers in trade.
“I visited a plant in Lesotho three weeks ago. The plant employs over 700 people. It manufactures car seats using copper which is taken from southern Africa and is processed in Ukraine,” he said, adding:
“In 2014, we exported $6 billion worth unprocessed coffee. You can see the loses Africa experiences is a result of lack of industrial capacity.”
The OAU founders said integrating the 1.3 billion market was the sole way of developing the continent, yet the AfCFTA came after 65 years, said Mr Mene, calling on key players to consider working together to accelerate the implementation of the belated arrangementΩ