7-8 JUNE 2017 / Tour & Taxis / Brussels

Promoting inclusive trade in Africa

Promoting inclusive trade in Africa

Boosting cross border trade through simplified trade regimes: Supporting local businesses to address the informal economy in Africa

debate
D3
Thursday, June 8, 2017 - 15:15 to 16:30

Key points

  • Some 72 % of African employment is in the informal sector.
     
  • Women and young people dominate informal cross-border trade, but information about simplified trade regimes to cut the cost of their businesses has yet to trickle down.
     
  • Barriers to cross-border trade include harassment, conflict near border posts and inadequate training for customs officials.
     
  • Premium prices are key to persuading small farmers to adopt common trading standards for staple grains.
     
  • Trade policies focused on women are a priority in EU development agenda.

Synopsis

Africa’s cross-border trade is largely carried out by women and young people who make a living buying and selling small-volume, low-value consignments. Despite official agreements to simplify the custom rules that apply to their businesses, information about new simplified trading regimes (STRs) has yet to reach many border posts. This means small traders continue to face harassment, customs duties, corruption, impounded goods and unnecessary paperwork.

While traditional infrastructure projects to improve roads and ports remain essential to regional trade, STRs are now also embedded in regional trading arrangements. These STR programmes aim to boost employment in the informal sector by lowering the cost of trade and simplifying border crossings. In East Africa, up to 25,000 women are already involved in trading groups created to spread the message that duties need no longer be paid on small consignments. Efforts are also underway to automate and further simplify border procedures.

In areas of chronic political instability, such as the border between the Democratic Republic of Congo and Uganda, security measures for women are also being put in place. These include safe spaces for women traders often subjected to sexual harassment, fast-track processes and training for male custom officials.

The Eastern Africa Grain Council is focusing its efforts on promoting trade in staple grains, which are collectively the biggest commodities traded in the region. Not only is the grain trade key to fostering rural development, but cross-border flows will also increase regional food security by encouraging imports from areas of surplus to countries experiencing harvest shortfalls.

To this end, the council has established an online bidding and settlements system based on certified warehouse stocks. It encourages small farmers to take part by offering premium prices for produce that meets their quality standards.

For development agencies, including the European Commission, trade programmes that target women and young people maximise the impact of development spending by boosting the income of the most vulnerable groups in a visible and direct way.

Further European Commission support for trade initiatives is expected to play a greater role in the European Union’s work towards the Sustainable Development Goals, with gender issues increasingly central to development policy decision-making. 

Insight

Enthusiasm for the STRs and other regional trade initiatives was tempered at times by the inherent conflict between open borders and regulations to ensure food safety and to prevent the spread of diseases.

Organised by

    Isolina Boto
    Manager
    Technical Centre for Agricultural and Rural Cooperation
    Hermogene Nsengimana
    CEO
    African Organisation for Standardisation
    Lucy Muchoki
    Chief Executive Officer, Kenya
    Pan African Agribusiness and Agroindustry Consortium
    Janet Ngombalu
    Regional Programme Coordinator
    Eastern African Grain Council (EAGC)
    Frank Matsaert
    CEO
    TradeMark East Africa
    Stefano Manservisi
    Director General
    European Commission - DG for International Cooperation and Development
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