Business / Economy
Zimbabwe left out of regional integration
12 Jan 2011 at 14:06hrs | Views
AS regionalism is rapidly taking centre stage in various countries' trade relations, it should not come as a surprise that many Southern African countries are in line for substantial economic benefits accruing from such arrangements.
South African Trade and Industry minister Rob Davies recently stated that the Southern African Development Community (Sadc) region is adopting a more unified front in negotiations with the European Union (EU) over Economic Partnership Agreements (EPAs).
But there are doubts that Zimbabwe is ready to derive any benefits from the new dispensation.
Although the country has witnessed a modicum of economic stability and growth due to the use of the multi-currencies since February 2009, economists insist that this development is insufficient for Zimbabwe to leverage on.
The EPA negotiations between the EU and Sadc began in 2004.
EPAs have been signed between the EU and African states with the express intention of building an economic framework, which will stimulate rapid and broad based economic growth in order to contribute to the effective reduction of poverty.
A final agreement between Sadc states and the EU could possibly be reached by mid-year.
The economic partnership agreements will inevitably have an effect on Zimbabwe as the new economic dispensation will affect the region's trade policies and regimes.
However, concerns have been raised over the EPAs due to the massive subsidies that European governments provide for their industries and farmers, a factor which could lead to trade imbalances skewed in favour of Europe.
The Confederation of Zimbabwe Industries has in the recent past made calls for the government to extend the negotiation time frame to protect industry from an influx of European goods.
Economist Eric Bloch contends that should the EPAs come into force, Zimbabwe, although disadvantaged by low productivity, will indirectly benefit.
"There will be spill-over advantages in terms of infrastructure developments, improvements in the energy sector, water distribution as more trade occurs on a regional basis," Bloch said.
But he added that there would be a need for a tectonic shift towards policies aimed at attracting investment.
South African Trade and Industry minister Rob Davies recently stated that the Southern African Development Community (Sadc) region is adopting a more unified front in negotiations with the European Union (EU) over Economic Partnership Agreements (EPAs).
But there are doubts that Zimbabwe is ready to derive any benefits from the new dispensation.
Although the country has witnessed a modicum of economic stability and growth due to the use of the multi-currencies since February 2009, economists insist that this development is insufficient for Zimbabwe to leverage on.
The EPA negotiations between the EU and Sadc began in 2004.
EPAs have been signed between the EU and African states with the express intention of building an economic framework, which will stimulate rapid and broad based economic growth in order to contribute to the effective reduction of poverty.
A final agreement between Sadc states and the EU could possibly be reached by mid-year.
The economic partnership agreements will inevitably have an effect on Zimbabwe as the new economic dispensation will affect the region's trade policies and regimes.
However, concerns have been raised over the EPAs due to the massive subsidies that European governments provide for their industries and farmers, a factor which could lead to trade imbalances skewed in favour of Europe.
The Confederation of Zimbabwe Industries has in the recent past made calls for the government to extend the negotiation time frame to protect industry from an influx of European goods.
Economist Eric Bloch contends that should the EPAs come into force, Zimbabwe, although disadvantaged by low productivity, will indirectly benefit.
"There will be spill-over advantages in terms of infrastructure developments, improvements in the energy sector, water distribution as more trade occurs on a regional basis," Bloch said.
But he added that there would be a need for a tectonic shift towards policies aimed at attracting investment.
Source - Byo24NEWS
