THE COMMON MARKET FOR EASTERN AND SOUTHERN AFRICA (COMESA)
COMESA was formed in 1994 to replace the former Preferential Trade Area (PTA) arrangement which had existed earlier. COMESA was established “as an organization of free independent sovereign states which have agreed to co-operate in developing their natural and human resources for the good of all their people.” With its 19 member states, population of over 389 million and annual import bill of around US$32 billion, and with an export bill of US$82 billion, COMESA forms a major market place for both internal and external trading.
By signing up to COMESA, countries agreed on the need to create and maintain:
- A full free trade area guaranteeing the free movement of goods and services produced within COMESA and the removal of all tariffs and non-tariff barriers;
- A customs union under which goods and services imported from non-COMESA countries will attract an agreed single tariff all COMESA States;
- free movement of capital and investment supported by the adoption of common investment practices 50 as to create a more favourable investment climate for the entire COMESA region:
- A gradual establishment of a payments union based on the COMESA Cleaning House and the eventual establishment of a common monetary union with a common currency;
- The adoption of a common visa arrangement, including the right of establishment leading eventually to free movement of bona fide persons.
In order to enhance intra-African trade, COMESA will continue to leverage on technology to create cheaper and easily accessible processes under its Trade Facilitation Programme to further deepen intra-regional trade and take advantage of recent revelations that the bloc has a trade potential of over USD$100bn. In March 2022, it was revealed that digitalization of trade instruments including e-CO (the Electronic Certificate of Origin), online information exchange platform, e-Trade, e-Logistics and e-Legislation are some of the key interventions that are expected to boost trade in the region. In line with this, COMESA Secretariat has so far pioneered several instruments, projects and programs under trade facilitation such as the Yellow Card Scheme, Regional Customs Transit Guarantee (RCTG), Simplified Trade Regime (STR), simple rules of Origin, Certificate of Origin and One Stop Border Posts (OSBPs) to assist further push intra-trade levels.
In March 2022, COMESA developed a business model to promote the digital financial inclusion plan. The model was created by the COMESA Business Council (CBC) as part of its digital financial inclusion plan for MSMEs. The model was validated during the 4th Digital Financial Inclusion Public-Private Dialogue conducted by the CBC on 10th March 2022. The model seeks to aim at supporting the design, development and deployment of an integrated digital financial services infrastructure that is low-cost, interoperable, real time and fraud resistant. It is intended to serve (MSMEs) and the customers they transact with at the bottom of the financial pyramid.