Monday, March 30, 2020

Business Botswana urges local business to exploit EPA

Business Botswana (BB) continues to entice the local business community to take on opportunities that come with custom free access to the European market, under the Economic Partnership Agreement (EPA).

The EPA seeks to among others increase trade between EU and SADC, without necessarily inhibiting growth of home grown industries from the less developed SADC countries. The rationale in advancing the benefits of EPA to the business community is to increase the range of products that the country exports to the EU. BB in partnership with the EU and the Ministry of Investment, Trade and Industry has scheduled workshops to be conducted in Francistown, Maun and Gaborone at different dates in the next month. 

Many businesses in Botswana derive a lot of benefits from BB including flexible terms for export taxes and flexible Rules of Origin (ROOs) which facilitate intra-regional trade and industrialisation across Africa.

Although Botswana has traditionally sold its beef to the lucrative EU market, it has proven overtime to have a very limited range of goods that it sells to the market. However, the workshops conducted by BB suggest that there are a lot of opportunities that remain untapped. 

Debates around the benefit that African countries derive from the EPA offer divergent views. A EU and policy debate news site, EurActiv, quotes Andrew Mold, UN’s economic analyst for East Africa arguing that the agreement poses a threat to the African economy in the long term. “The African countries cannot compete with an economy like Germany’s. As a result, free trade and EU imports endanger existing industries, and future industries do not even materialise because they are exposed to competition from the EU,” said Mold. German politician Ska Keller is quoted as saying, “We are pointing a gun at their chest”. He went further to explain that “Developing countries have a gun pointed at their chest ÔÇô either they sign or their market access to the EU is restricted. The EPA is the opposite of development cooperation.” 

Increasing production is considered a benefit to the African economy by the EU. EurActiv quotes German Politician Michael Gahler defending the EPA saying, “We Europeans have experienced, first-hand, how much prosperity is brought on by the free movement of goods. We want to help African regions take similar steps.”
It remains to be seen if there exists profitable markets for Botswana’s goods outside of beef. 

The SADC EPA group consists of seven SADC member states out of 15 and it is constituted by the five Southern Africa Customs Union (SACU) being Botswana, Namibia, Swaziland, Lesotho and South Africa plus Mozambique and Angola.

 

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