Africa’s economic growth has gained significant momentum in recent years, with regional integration emerging as a key driver for sustained development. Regional integration aims to promote economic cooperation and reduce trade barriers among neighbouring countries, fostering increased intra-regional trade, investment, and overall economic growth.
According to an article by The World Bank published in 2023, the rate of economic growth in Sub-Saharan Africa (SSA) in 2022 decreased to 3.6% compared to 4.1% in the previous year. It is expected that economic activity in the region will continue to slow down to 3.1% in 2023. However, there is some optimism as growth is predicted to improve to 3.7% and 3.9% in 2024 and 2025 respectively.
Regional integration will play a significant role in this forecasted growth through promotion of trade and investment among member countries. Currently, by lowering tariffs and quotas, the trade agenda has increased the flow of goods and services across borders, resulting in increased competition, lower prices, and overall greater efficiency..
Zambia, like many African nations, has recognized the significance of regional integration and been actively pursuing strategies to strengthen economic ties with its neighbours. As part of these efforts, we are party to the Tripartite Free Trade Area (TFTA). The TFTA is a free trade agreement between the Common Market for Eastern and Southern Africa (COMESA), the East African Community (EAC), and the Southern African Development Community (SADC). The agreement aims to create a single market for goods and services, promote cross-border trade, and increase investment flows among the member states.
Manufacturers play a pivotal role in achieving goals espoused by these agreements, as they, in addition to other sectors, provide the source of exports directed into the region. Allow me to now outline how manufacturers can aid regional integration. The first strategy is to do with participation in regional trade fairs and exhibitions. This will provide an opportunity to showcase Manufacturers’ products and services to potential customers in the region. This also allows for networking with peers which builds knowledge on new technologies and best practice. The preceding can also be achieved through partnerships and joint ventures amongst firms in the region. Secondly, Manufacturers can further integration by lobbying their government to support regional integration initiatives. This can include advocating for the removal of trade barriers, harmonization of standards and regulations, and the development of infrastructure to facilitate trade. Thirdy, investment in research and development to improve the quality and competitiveness of their products has an equally positive effect on trade.
And lastly, Zambian manufacturers can promote regional integration by participating in regional value chains. This involves integrating their production processes with those of other manufacturers in the region to create a more efficient and competitive supply chain.
The above notwithstanding, regional integration does face challenges. Amongst the impediments are differences in regulations and standards across countries; infrastructure deficits; and inadequate finance.
With respect to infrastructure limitations, manufacturers in the region are plagued by poor transportation networks and unreliable power supply. Access to finance, additionally, remains a challenge for the manufacturing sector as players struggle to secure funding for investments in new technology, equipment, and training, which are necessary to compete in the regional market.
To fully realize the potential benefits of regional integration, African countries need to address these challenges and strengthen their cooperation and integration efforts.
Achieving regional integration in Africa is vital for the continent’s economic growth and sustainable development. Manufacturers in Zambia have a crucial role to play in this process. With greater collaboration in value chains and advocacy for policy reforms, among other interventions, manufacturers stand ready to spearhead Zambia’s trade integration and help create a prosperous country and region.
The Author is Business Development and Membership Specialist at the Zambia Association of Manufacturers
