“Decrease trade barriers in region”

An increase in trade between countries in Southern Africa can promote growth in the South African economy and local businesses.

This according to Falilou Fall, head of the Africa chair of the Organisation for Economic Co-operation and Development  (OECD), who recently released a report on the South African economy.

At an event of the South African Institute for International Affairs (SAIIA),  Fall said better integration in the South African Developing Community (SADC) provides potential for economic growth.

“The SADC is already an important export market for South Africa – an estimated 25% of South African exports go to the region.”

Regional trade only represents 10% of the country’s total trade.

In order to increase this, policies must ensure that trade barriers are reduced.

Fall said trade tariffs are relatively high. However, non-trade barriers like transport issues, lost time at border posts and different trade rules are the biggest problems.

The OECD’s recommendations for regional integration are:

  • Decrease non-tariff barriers;
  • Promote competition in infrastructure related services in the country;
  • Simplify and accept one set of rules for the origin of products in the Triangular Free Trade Area (TFTA);
  • Provide better infrastructure in special economic zones and develop their ties with local economies;
  • Improve information technology at custom posts and improve mutual connections within SADC systems;
  • Create a regional fund for infrastructure and increase the private sector’s participation in infrastructure projects.

Fall said the recommendations will promote trade in agricultural products, which plays an important role in economic growth.

According to him, agricultural value chains in the region must become more competitive.

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