Malawi Confederation of Chambers of Commerce and Industry (MCCCI) has warned that unless Malawi irons out economy’s structural challenges, it will not be party to the benefits of the Tripartite Free Trade Area (Tfta) that has a combined GDP of $1.2 trillion (about K900 trillion).
MCCCI chief executive officer Chancellor Kaferapanjira sounded the warning yesterday as countries in Tfta comprising Sadc, Comesa and East African Community (EAC) are racing against time to ratify the trade agreement by the end of this month.
He said local firms are bound to lose out in terms of trade as has been the case with Southern African Development Community (Sadc) and Common Market for Eastern and Southern Africa(Comesa).
Kaferapanjira said at the onset of the Tfta discussions in 2015, local firms voiced out their concerns through the Ministry of Industry, Trade and Tourism, where obstacles to doing business and possible solutions were highlighted.
Since then, he said few parameters have changed to enable improved trade performance in the region with critical ones being the cost of finance, intermmittent power supply and infrastructure challenges, which are yet to be resolved.
He said: “We have lost out on regional integration opportunities because we have nothing to export. And with little changes, it means businesses will now have to live with the challenges.
“But it should be noted that as businesses, we have always had mixed views on this. But the question is how we take advantage of the bigger market in the face of persisting challenges such as electricity and infrastructure which have mainly been concentrated in the urban areas.”
Kaferapanjira said there is also need roads for in rural communities which are passable all year round so that all areas are opened up to integrate the economy to enable everyone to participate.
A press statement released yesterday by the 19-member country Comesa confirms that the deadline set by the tripartite council of ministers for member States of three regional economic blocs to sign and ratify the Tfta lapses this month.
So far, four countries—Kenya, Egypt, South Africa and Uganda—have signed and ratified the agreement.
A total of 22 out of 26 countries in the tripartite free trade bloc have signed the agreement.
Currently, 93 percent of the work on rules of origin has been completed, providing the basis for trade to begin, according to the statement. In addition, legal texts have been concluded and adopted.
Ministry of Industry, Trade and Tourism spokesperson Mayeso Msokera yesterday could not comment on Malawi’s position, but speaking in February in Lilongwe where President Peter Mutharika has an audience with Comesa secretary general Chileshe Mpundu Kapwepwe, Minister of Foreign Affairs and International Cooperation Emmanuel Fabiano said Malawi is ready to ratify the Tfta as consultations were concluded and documentation of issues was done, adding what remains are administrative processes to facilitate ratification.
Kapwepwe lobbied Mutharika to ensure that Malawi ratifies Tfta to widen its commodity market.
Tfta was launched in June 2015 by the Third Tripartite Summit of Heads of State and Government after more than three years of negotiations.
It is anchored on three pillars, namely market integration, industrial development and infrastructure development.
Tfta,with 600 million people, was established to remove duplication and overlaps by trade blocs. n