Can SADC’s industrialisation strategy feed the poor?

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Timo Shihepo

Windhoek - The SADC Secretariat is looking at ways to go beyond its own policies and actually introduce measures that would essentially benefit small traders and improve the livelihoods of destitute citizens.

Although SADC has made a provision for the free movement of people in the region as well as opening up intra-trade, small businesses have hardly benefited from this.

“Even though we opened up in terms of intra-regional trade, the challenge has been that there is no security of trade. People at the grassroots are not looking at these policies that we are putting in place, they are looking at what is it you are going to put on the table for them to eat,” SADC’s director of finance, investment and customs, Sadwick Mtonakutha, told The Southern Times.

According to SADC, the only way to bring in the small-scale business into the regional mainstream trade circle is by implementing fully the SADC industrialisation strategy.

This strategy recognises that for trade liberalisation to contribute to sustainable and equitable development, and thus to poverty reduction, it must be complemented by the requisite capacities to produce and to trade effectively and efficiently.

The primary orientation of the industrialisation strategy is the importance of technological and economic transformation of the SADC region through industrialisation, modernisation, skills development, science and technology, financial strengthening and deeper regional integration.

The strategy is anchored on three pillars namely; industrialisation as a champion of economic and technological transformation; competitiveness as an active process to move from comparative advantage to competitive advantage; and regional integration and geography as the context for industrial development and economic prosperity.

Mtonakutha said the issue of diversification of export became a problem and that is where the industrialisation strategy comes in.

“So that we now try to focus on what is it that we can do, what is it that we can produce? So, in terms of industrialisation, I think that should be the focus and that is the focus. 

“Apart from that, it’s also the issue of the services agenda because you need infrastructure for you to industrialise. And what services are we talking about? And how do we move whatever we can move from point A to point B?  So those are the issues that are very much crucial and we have made some strides in terms of moving this agenda forward,” he said.

The SADC industrialisation strategy and roadmap formulated in 2015 has an implementation timeline up to 2063. It has a long-term perspective and is aligned to national, regional, continental and international dimensions.

And if it is to really achieve its purpose the strategy will need SADC to also implement its Free Trade Area strategy.

The SADC Free Trade Area, launched in August 2008, now covers 12 of SADC’s 16 member states.

Except for two member states currently facing challenges in implementing their tariff commitments, all the other participating member states are fully meeting their obligations under the Free Trade Area.

According to information from SADC, since 2013, intra-regional trade in SADC has been consistently above 20% and growing. The secretariat considers this to be a relatively good achievement compared to the pre-free trade area era high of around 16%.

Nevertheless, this remains low compared to other regions and more importantly, such levels of trade are not enough to serve as a platform for sustained economic growth and development in the region. Among the key constraints to this has been the region’s dependence on commodity-driven trade, which largely limits the ability of member states to trade with each other.

It is for this reason that the region adopted the SADC Industrialisation Strategy and Roadmap in April 2015.

SADC wants to use this strategy to create a platform for greater participation in regional and global value chains and is key in assisting member states to address supply-side constraints and give impetus to increased intra-SADC trade.

 

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