Transcript Mr. Phazha T. Butale, Botswana Ministry of Trade and - un

Priority III(a) of the VPoAInternational Trade
National Stakeholder sensitization
Workshop on the Vienna
Programme of Action
27– 29 October 2015
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PRESENTATION OUTLINE
I.
Priority III(a) objectives
II. Actions by LLDCs
III. How far is Botswana?
i. Policies and Strategies
ii. Trade Agreements
IV. Challenges
I. Priority III (a) objectives
• Significantly increase the participation of LLDCs in global trade,
with a focus on substantially increasing exports
• Significantly increase the value added and manufactured
exports with the objective of substantially diversifying their
markets and products
• Strengthen economic and financial ties with countries in the
region so as to gradually and consistently increase the share of
landlocked developing countries in intraregional trade
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II. Actions by LLDCs
• Develop and implement policies, strategies and
measures that will significantly increase economic and
export diversification and value addition
• Integrate trade policies into national development
strategies
• promote a better business environment so as to assist
national firms to integrate into regional and global
value chains
• fully leverage bilateral and regional preferential trading
arrangements with a view to broadening regional and
global integration
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III. Status of Implementation
by Botswana towards
achieving Priority III(a)
i. National Trade Policy (2010)
ii. Complementing Strategies and Policies
iii. Trade Agreements
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NATIONAL TRADE POLICY
• The National Trade Policy (NTP) was adopted by Parliament
in March 2010 and is currently under review.
 The National Trade Policy is intended to achieve, among
others, the following:
 export diversification;
 economic diversification;
 global competitiveness;
 private sector development;
 Employment creation; and
 Poverty reduction.
Complementing Policies and Strategies
The following strategies, complementary to the NTP and
necessary for the NTP to achieve its objectives are in
place:
• Industrial Development Policy
• National Export Strategy
• Special Economic Zones Policy
• Competition Policy
• Economic Diversification Drive strategy and
• Private Sector Development Strategy.
TRADE AGREEMENTS
Why Trade Agreements?
• Secure access to world markets for locally produced goods and
services (given limitations set by Botswana population)
• Access to inputs and finished goods at competitive prices
• Facilitate industrial development thus creates employment
opportunities and contribute to poverty eradication
• In some cases, Trade Agreements, especially with more advanced
economies provide for technical and development assistance
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TRADE AGREEMENTS (cont.)
Botswana is currently party to a number of trade agreements being:
Botswana /Zimbabwe Trade Agreement
• Since 1956 and amended in August 2010.
• Aims to facilitate trade between the two countries.
Opportunities
• Broaden the scope of investment
• Enhance economic cooperation
• Duty free access for goods wholly originating or meeting 25%
local content e.g. animals born and bred, crops grown or
minerals extracted in a country
• Cumulative principle; material from either contracting Party
counts towards local content
• Waste and scrap are recognised and acceptable raw material for
production of goods to be traded under the agreement
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Trade Agreements (cont.)
SACU Agreement
(Between Botswana, Lesotho, Namibia, South Africa & Swaziland)
• Since 1910, amended 1969
• Latest amendment signed in 2002
Objectives among others include:
• To facilitate the cross-border movement of goods between the territories
of the Member States;
• To create effective, transparent and democratic institutions which will
ensure equatable trade benetif to Member States;
• To promote conditions of fair competition in Common Customs Area;
• To facilitate development of common policies and strategies;
• To enhance economic development, diversification, industrialisation and
comeptitiveness of Member States;
• To facilitate the equatable sharing of revenue araising from customs, excise
and additional duties levied by Member States
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Trade Agreements (Cont.)
SACU/European Free Trade Association(EFTA):
(Iceland, Liechtenstein, Norway and Switzerland)
• Free Trade Agreement (FTA)
• Signed in 2006 and implementation started in 2008
Opportunities
• offers SACU duty free and quota free access for nearly all industrial
products e.g. Textile & Clothing, leather products, feather dusters,
brooms and mops, jams and fruit jellies
• SACU Member States signed Bilateral Agricultural Agreements with
Norway, Iceland and Switzerland
• Reduced margins of preference on WTO quota system for SACU e.g.
meat of bovine fresh/chilled (85% of MFN), meat of swine fresh or
chilled (free), Vegetables free (Nov-May), natural honey (free)
• Norway offered Botswana and Namibia duty free beef quota (500 tons)
to be shared
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Trade Agreements (cont.)
SACU/Common Market for the Southern Cone (MERCOSUR):
(Argentina, Brazil, Paraguay and Uruguay)
• Preferential Trade Agreement (PTA)
• Signed in April 2009.
• Not yet implemented pending ratification by all parties.
Opportunities
• Strengthening economic co-operation ties
• Preferential market access to the South American countries e.g
Hen eggs, carrots & turnips, cabbage, lettuce, cucumbers,
canned pears, salts
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Trade Agreements (cont.)
SADC Protocol on Trade
• Signed in 1996 and implemented in 2000
Agreement aims to:
• Liberalize intra regional trade in goods & services
• Improve climate for domestic, cross border and foreign
investment.
• Enhance economic development and industrialization
• Deepen regional integration through the FTA (2008), Customs
Union (2010), Common Market (2015) etc.
Negotiations on Trade in Services
• SADC has identified the following 6 priority areas for
negotiation
(Communication, tourism, energy related,
transport, financial & Construction)
• Preparations for the negotiations are on-going.
Opportunities
• Enlarged market - population 274 million, GDP US$ 558
billion
• Source for materials and market for finished products
increased
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• Increased potential for non traditional export
Trade Agreements (cont.)
SADC/EU Economic Partnership Agreement
(Angola, Botswana, Lesotho, Mozambique, Namibia, South Africa and Swaziland)
EU Market size; 27 members
• Population - 502.5 million
• GDP – €12, 279 033 billion
Opportunities
• Offers Duty Free Quota Free Access for almost all products [both
industrial and agricultural (except sugar & rice which have special
conditions as well as Arms)]
• Allows more liberal rules of origin (single stage transformation),
• Allows for accumulation with other Countries who have signed the
EPA
• Technical assistance- EUROPEAN Development Fund/European
Investment Bank and Centre for Development of Enterprises
• Gradual liberalization for EU goods in SADC over a 10 year period.
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Trade Agreements (Cont.)
The World Trade Organization
• Rules based Multilateral Organization, currently comprising 161
Member States
• Established in January 1995 following the Uruguay Round of
multilateral trade negotiations.
• Members currently negotiating the Doha Development Round with a
view to increasing market access and updating trade rules
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On-going Negotiations:
SACU/India Preferential Trade Agreement
Opportunities
• Shared experiences with SMME
• Appropriate technology
• Competitive intermediate inputs
SADC/COMESA/EAC Tripartite Free Trade Area - 26 countries
• Combined population of 527 million {SADC- 258m(SACU 58million)}
• Combined GDP +/- 1000 billion [SADC –US$ 558 billion(SACUUS$383 billion)
Continental Free Trade Agreement
• covers market size of about 1.6 billion,
• established to achieve a mutually beneficial trade agreement for
members of the African Union through enhancement of industrial
development and diversification of African economies. Free
movement of business persons
• The scope of the negotiations will cover trade in goods, trade in
services, investment, intellectual property rights and competition
policy.
IV. Challenges
 Relatively small firms: limited capacity (limited resources
and technology)
 High costs of production (high inputs + Transportation
cost hence uncompetitive prices
 NTB/Measures (Standards)
 Tariff Escalations
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THANK YOU
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