SADC PF training highlights challenges and opportunities within African trade |21 February 2025
Trudi Hartzenberg, executive director of Tralac (Photo: Contributed)
An online training on trade-related issues has highlighted the challenges and opportunities within African trade, underlining the dominance of global markets over intra-African trade.
The executive director of Tralac, Trudi Hartzenberg, and Professor Gerhard Erasmus, a Tralac Associate, facilitated the training, which drew the participation of SADC members of parliament and staff of national parliaments.
Speaking on the second day of the workshop on Wednesday, Ms Hartzenberg provided a South African perspective on intra-African trade. She explained that intra-African trade remains low, accounting for only 15-16% of Africa’s total exports.
She noted that 84% of Africa’s exports are directed to global markets, with the bulk of these exports being raw materials.
“If we look at a breakdown of that trade with global partners, it is very much concentrated on commodities,” she explained, listing coal, copper, gold, diamond, lithium, cobalt, and other resources that fuel global industries.
She said South Africa is a key commodity exporter, with some manufactured exports including motor vehicles and chemicals, while importing mostly manufactured products, particularly from China and other global partners.
Ms Hartzenberg stressed the importance of SADC and Sacu (Southern African Customs Union) in South Africa’s regional trade, and said that South Africa’s largest African trading partners were Mozambique, Botswana, Zimbabwe, Zambia, Namibia, Eswatini and Lesotho.
She pointed out that even with the full implementation of AfCFTA (African Continental Free Trade Area), these strong regional trade ties will remain important; unlikely in the short to medium term to be replaced by trade with partners outside SADC, due to high intra-African trade costs.
“It is costly to trade on the continent. Transport costs, delays at border posts, and non-tariff barriers remain major impediments,” she said, noting that despite tariff reductions under AfCFTA, these challenges would continue to hinder deeper integration, unless non-tariff barriers are eliminated.
Ms Hartzenberg stressed that reducing tariff barriers alone was not enough to boost intra-African trade. Investments in customs efficiency, improved governance, and industrialisation to boost and diversify capacity to produce tradeable goods and services were essential.
She highlighted the importance of customs and border management processes, mutual recognition agreements for authorised economic operators, and trade facilitation mechanisms to streamline cross-border trade.
“This will make an enormous difference in promoting trade,” she emphasized, noting that Africa must also expand and diversify its productive capacity to change what and how it trades globally.
“We need to produce more tradeable goods and services,” she said, accentuating the importance of trade-industrial policy connections.
She said beyond the African continent, China remains South Africa’s largest export destination, while other key trade partners include the United States, Germany, the United Kingdom, the Netherlands, and Belgium. The growing influence of India, the UAE, Thailand, Saudi Arabia, Oman, Malaysia and Japan in South African trade was also noted.
She stressed that African countries must develop stronger manufacturing sectors to reduce dependence on imported industrial goods.
She urged caution regarding the expectations of AfCFTA, warning that free trade agreements alone are unlikely to significantly transform Africa’s trade landscape and that the benefits are likely to be uneven.
Complementary policies and initiatives to support Africa’s industrialisation are essential for the success of the AfCFTA.
She highlighted the importance of evidence and data-driven trade policies.
“We’re hoping that AfCFTA can contribute to reducing transaction costs of trade, making African producers more competitive not only on the continent but in the global context.”
On his part, Prof Erasmus urged African lawmakers to address stability and governance issues to unlock the continent’s economic potential.
Stressing that peace and stability are critical enablers of economic growth, he warned that instability in regions such as the Democratic Republic of Congo (DRC), Mozambique, the Horn of Africa, Sudan and the Sahel threatens economic progress.
Professor Erasmus referenced Africa’s youth demographic, with the median age on the continent being 19 years. He called for policies that ensure young people are actively engaged in economic and governance processes to boost regional integration efforts.
On progress and challenges, Ms Hartzenberg provided insights into the continent’s Regional Economic Communities (RECs), which are recognised by the African Union (AU). These include the Common Market for Eastern and Southern Africa (Comesa), the Southern African Development Community (SADC), the East African Community (EAC), the Economic Community of West African States (Ecowas), which have established free trade areas or customs unions, as well as others, such as the Intergovernmental Authority for Development (Igad) and the Arab Maghreb Union (Amu) which have not yet implemented trade arrangements among their members.
She explained that implementation of some of the free trade areas and customs unions is still work in progress, bringing to the fore the challenges of integrating unequal partners in these arrangements.
Regarding SADC’s trade agenda, Ms Hartzenberg said the SADC Free Trade Area (FTA) was launched in August 2008, with a phased reduction of tariffs. Thirteen out of 16 SADC member states participate in the FTA, while Angola, Comoros and the DRC remain outside.
She said ccountries that include Malawi, Zimbabwe and Tanzania had faced difficulties in implementing tariff reductions, with some requesting temporary exemptions to protect local industries.
Ms Hartzenberg also discussed the SADC Protocol on Trade in Services, which came into force in January 2022. It prioritises key sectors such as communication, construction, energy-related services, financial services, tourism and transport. A second round of negotiations is underway to expand coverage to business services, distribution, education, health, and environmental services.
She stressed the importance of the services sector, not only for employment and economic growth but also as a facilitator for trade and development. Services like healthcare, education, and communication play a direct role in improving development outcomes across the region.
Both experts highlighted the complex nature of Africa’s trade landscape, and said overlapping memberships in multiple RECs was a challenge.
The Trade Law Centre (Tralac) and the SADC Parliamentary Forum (SADC PF) jointly organised the training with support from SIDA.
By Moses Magadza
Media and communications manager at the SADC PF