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Frenchman bang on over African liberalisation

By Timothy Cox
December 3rd, 2009 at 5:04 pm | Comments Off on Frenchman bang on over African liberalisation | Posted in Economics

truckWhile the Doha round of trade agreements sinks even deeper into a quagmire of bureaucratic hurdles and empty promises, Emmanuel Martin hits the nail right on the head in an article for Kenyan ‘paper Business Daily.

He correctly states that Africans have the opportunity to free themselves from trading constraints in spite of the stalled World Trade Organization (WTO)  talks.

The WTO’s goal of reducing the import tariffs faced by developing nation exporters may be admirable, but the sad reality is that a disproportionate amount of the barriers to trade are actually imposed by African governments on other Africans.

When a World Bank study looked at trade barriers in 75 countries, they found that the countries ranked as “below average” in terms of free trade could boost trade by $377 billion–just by liberalising “half way to average”.

Imagine the effect on trade and alleviating poverty if they fully liberalised.

And yet within Africa trade is stifled by extortionate admin fees for construction permits and registering business, debilitating delays at border crossings and corrupt officials skimming money.  In combination, this makes the costs of doing business in Africa the highest in the world.

Indeed, according to the World Bank Doing Business report, even the warzones of Iraq and Afghanistan offer a comparative haven for business compared with many African nations. It should therefore come as little surprise that the continent has the lowest levels of intra-regional trade in the world: under 10 per cent of exports are destined for other African nations.

Until these issues are addressed there is little hope for Africa’s millions of potential entrepreneurs, even if the Doha talks do come to an expedient conclusion–which, by the way, they won’t.

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