1. Tripartite SADC-EAC-COMESA Initiative and Free Trade Area NegotiationsBy
Dr Rob Davies,
Minister of Trade and Industry
Republic of South Africa
June 2011

2. South Africa’s New Growth Path and Regional Integration
NGP aims to accelerate growth and industrial development in to generate employment
A key element of the strategy is regional integration
SA consistently runs a trade surplus in Africa
Structure of exports to Africa is value added products that support industrial and employment objectives
Work has focused on integration in SACU and SADC
Tripartite Initiative between SADC,EAC and COMESA will extend these integration efforts 2

3. Africa’s Growth and Development Prospects
Africa is the second fastest growing region in the world, after Asia
Enormous reserves of raw materials
60% of unused arable agricultural land globally
Young and growing population
Growing middle class with considerable purchasing power,
Rapid urbanisation
Improvements in economic governance 3

4. Africa’s Growth and Development Prospects
Over the next five years:
Africa’s output will expand 50%: From US$1.6 to 2.6 trillion
Growth will expand on average at 5.5% per annum
Africa’s GDP per capita income will expand by 30%
Private consumption in Africa’s 10 largest economies will more than double
Africa’s total trade will grow dramatically: from US$ 654 billion to US$1.6 trillion by 2015; expanding by 17% per year with share of global trade almost doubling from 3.2% to 6% in 2015
Capital inflows expected to reach US$150 billion

5. Tripartite FTA Imperatives
In context of growing competition for African markets, T-FTA can ensure that we trade among each other on equal terms to third parties
Tripartite framework derives legal basis from Lagos Plan of Action and the Abuja Treaty establishing the African Economic Community (AEC)
Strategic response to the AEC’s objective to rationalise and consolidate existing regional economic communities (RECs), to achieve an African common market

6. Tripartite FTA Imperatives
T-FTA will strengthen economic growth and development prospects in Africa
Encompasses 26 countries; combined GDP approaching US$1 trillion; population of almost 600 million
Larger market attracts FDI and can boost intra-Africa trade
Allow Africa to compete more effectively on global stage
Allow Africa to join emerging economies in the South as new centres of global economic growth, and sources of trade and investment

7. Tripartite Initiative
In 2008, Heads of State of SADC, EAC, COMESA met in Kampala to launch Tripartite Initiative
Directed Secretariats of the 3 RECs to begin work on:
Negotiations for a FTA among the RECs
Cross-border infrastructure development, notably North-South transport corridor
Free movement of business people
In 2009, 2nd Tripartite Summit in Lusaka mobilised finance for the N-S Corridor

8. Third Tripartite Summit
President Zuma hosted 3rd Tripartite Summit in SA on 12 June 2011
Summit adopted “development integration” approach combining market integration, industrial development, and infrastructure development:
Agreed to initiate a work programme on building production capacity across member states
Received an update on current work on regional infrastructure development (N-S Corridor); and
Launched SADC-EAC-COMESA T-FTA negotiations. 8

9. T-FTA Negotiations
Summit adopted proposals on scope, phasing, timeframe and
principles for FTA negotiations:
Trade in goods negotiations in phase one
Technical preparations and data exchange of trade and tariffs – 6-12 months
Overall indicative time frame: 3 years
Phase two may cover services and trade related issues (eg. services, competition, intellectual property, investment)
Principles: build on acquis under 3 RECs; reciprocity; acknowledge sensitivities; flexibility and variable geometry
Address non-tariff barriers, regional standards and trade facilitation (border measures)

10. Movement of Business People, Supply Capacity and Infrastructure
Negotiations on free movement of business people to be conducted on separate track lead by departments of Home Affairs in phase one
Secretariats to coordinate work on building production capacity and identifying cross border value chains
Infrastructure work on separate track with relevant Departments (eg: transport, energy, communication)
President Zuma requested by NEPAD/AU to champion N-S transport Corridor
Task Team set up under Presidency to lead this work