"This is what I call real integration," says Alhaji Bamanga Tukur, chairman of Ecomarine and executive director of the African Business Roundtable. Second, country-of-origin rules (needed to determine the source of a product) should be kept simple, flexible, and transparent. -- K.Y. 2 The landscape of Africa’s linear integration model At a deep level, regional integration in Africa has its roots in the political forces determined by the With the right balance of audacity and pragmatism, regional integration could yield large dividends for Africa and the world alike. Washington DC: The World Bank. African regional integration has had a remarkable new beginning since the formal beginning of the African Union (AU) in 2002. Three RECs were clear frontrunners: the Union Economique et Monétaire Ouest-Africaine (UEMOA), the Economic Community of West African States (ECOWAS) and the Southern African Development Community (SADC). Pp 351-358. The same is true for Kenya whose most important trading partner is Uganda and the intra-EAC trade volume is growing dramatically. illustrate the impact of regional financial integration. New strategies aim for public involvement, practical results, Greater African unity has long been a cherished -- but elusive -- goal. Its first Annual Report on Integration in Africa, to be issued in full later this year, looks at a broad spectrum of integration issues in Africa and seeks to assess quantitatively how well African countries have done in forging ties with each other. Ordinary travellers often have to pay small bribes to get past police checkpoints. Much more needs to be done, however. This series of articles examines some of the central challenges facing the drive for integration, including enhanced trade among African countries, more roads and other infrastructure, reform of regional institutions, greater accountability and popular involvement, and closer coordination of efforts by the public and private sectors. Regional integration and regional governance under the new African initiatives: a critical appraisal 2 (RECs), the interface of regional and continental governan ce, is conducted. Fourth, the World Trade Organisation’s Trade Facilitation Agreement should be implemented to reduce the time it takes to cross borders and the transaction costs associated with nontariff measures. And even when countries are able to pay, Mr. Adedeji observes, "the resources made available to regional organizations are resources denied to the people of those countries. A major cause of the shortcomings of past integration efforts, they argued, lay in the failure of African leaders to consult their citizens when designing integration strategies and programmes. This, in turn, is helping encourage the rest of the ECOWAS members to step up their own integration efforts. Saggi, K. (2002). The importance of regional integration highlighted by COVID-19. Open regionalism could also stimulate connections between small and medium-size enterprises and international value chains, thereby enabling these firms to enter global markets. African businessmen frequently need to wait 6-8 weeks to get visas to visit other African countries, while citizens of the UK or France can travel to many African countries and obtain a visa on arrival. IMPACT OF REGIONAL INTEGRATION ON TRADE AND FIRM PERFORMANCE IN WEST AFRICA: THE CASE OF BENIN* by Dr. Toussaint Houeninvo National School of Applied Economics and Management University of Abomey Calavi Republic of Benin and Dr. Sylvain H. Boko Department of Economics Wake Forest University Winston-Salem, NC, USA * Published, in Mina Baliamoune-Lutz, Alojzy Z.Nowak and … Benefits Of Regional Economic Integration. Regional integration in Africa has made tremendous strides. Moreover, integration can improve regional security, because the expansion of international trade often correlates with a reduction of conflict. The challenges of regional integration in Africa • page 1 Paper 145 • June 2007 Introduction It is widely acknowledged that Africa’s integration efforts have thus far failed to bear satisfactory fruit. The African Union (AU), regional economic communities (RECs) and regional mechanisms (RMs) held their second mid-year coordination meeting on 22 October 2020. For instance, policy barriers at the border may offset the gains transport infrastructure cooperation. At the same time, he added, African governments must pay close attention to the sequence and consequences of their actions. But many African governments lacked the financial resources and political credibility to effectively implement policies even within their own borders. A new study from the African Development Bank provides evidence that both objectives are not mutually exclusive; in fact, they could be mutually reinforcing. Moreover, researchers have cast doubt on the goal of integration. According to Malawi's Deputy Minister of Transport and Public Works Jan Sonke, freer regional trade led to an influx of cheap South African furniture into Malawi, causing the failure of many local furniture makers. Over the years, many other institutions were also established in Africa's different regions. It will lower costs. In January 2000, for example, tariffs on intra-regional trade in goods produced within the eight-member Union Economique et Monétaire Ouest-Africaine (UEMOA) were reduced to zero. Chapter 3 of the report presents the main findings and policy recommendations. Since a regional common market obviously provides a much larger market than that offered by the domestic market of a single country, economies of scale, both internal and external, become possible with the widened size of the market. There is now a renewed impetus to establish closer economic and political ties among the continent's numerous countries, based on a heightened appreciation of the need for regional integration and a clearer understanding of the reasons for past failures. How quickly -- and how well -- Africa moves toward integration will depend to a great extent on reforming its existing regional institutions. Regional integration efforts, however, need to go hand in hand with competitiveness-enhancing policies as explored in other parts of the Africa Competitiveness Report. Regional integration plays an important role in Africa’s political rhetoric and vision, and has contributed to shape Africa’s political, economic and institutional landscape. “International Technology Transfer and Economic Development.” In Development, Trade and the WTO. Abstract. Small-scale manufacturers have difficulty getting the necessary import or export licenses. Evidence is reviewed in Section 4. AMU × CEN-SAD. Regional integration in Africa, however, can play a vital role in diversifying economies away from dependence on the export of just a few mineral products; in delivering food and energy security; in … Regional economic integration refers to the agreement amongst countries within a certain geographic area for reducing and ultimately removing tariff barriers, making sure there is better flow of services or goods through the respective nations. Important steps are under way towards harmonising the regulatory environment for financial banking and services. arguments in favour of integration on a regional basis in Africa. Regional Integration in Africa: An Important Step towards Global Integration. Thirdly, education and cultural exchanges have the potential to enhance regional integration for the benefit of all members. challenges to regional integration in africa: the case of the revived east africa community 2000-2012 gichohi marvin muhammad r50/69883/2011 a thesis submitted in partial fulfillment for the degree of master of arts in international studies.institute of diplomacy and international studies, university of nairobi august 2015 In particular, five trade measures could bring total gains worth 4.5% of Africa’s GDP, or $134 billion a year – almost the amount of all official development aid in 2017. Required fields are marked *. In April, a similar consultation was held at the headquarters of the African Development Bank (ADB) in Abidjan, Côte d'Ivoire, and in June representatives of African civil society groups returned to Addis Ababa for further discussions with OAU officials and African leaders such as Nigerian President Olusegun Obasanjo. Tiny Benin does not have the same economic interests as its giant oil-rich neighbour, Nigeria. The continent’s leaders also created a large number of regional institutions to make incremental progress toward Nkrumah’s goal. Some analysts of the FTA argue that such compensation need only be temporary, since expanded trade will inevitably boost revenue from these countries' value-added taxes, in the long run surpassing the old tariff revenues. "We have a lot of bridges to build to get to the other side of the river. var D=new Date(),d=document,b='body',ce='createElement',ac='appendChild',st='style',ds='display',n='none',gi='getElementById',lp=d.location.protocol,wp=lp.indexOf('http')==0?lp:'https:'; of Africa’s development. An analysis of South Africa's role in regional integration in Southern Africa : prospects and challenges. For many others, they still lie in the future. It will make the African consumer's plight so much more hopeful. The Regional Economic Communities (RECs) of the African Union. COMMENT | Célestin Monga | When Kwame Nkrumah, under whose leadership Ghana became the first African country to claim independence in 1957, was overthrown by a military coup in 1966, few of his fellow citizens shed a tear for his regime. "No matter what the IMF and World Bank say, we're going to do that.". Recent efforts also reflect a more holistic perspective. Regional Integration in Africa: An Important Step towards Global Integration. In addition to examining specific indicators for each regional economic community (REC), the report has developed its own African Integration Index . Because of its common currency and elimination of tariffs within the UEMOA, its economies are already more closely integrated than the economies of other ECOWAS countries. Save my name, email, and website in this browser for the next time I comment. Promotion of regional integration remains an important economic and political goal in Africa. "This objective can't be realized through market forces.". Although REI's role in contributing to growth and development was recognised and acknowledged, its importance in Africa has never been properly outlined. The momentum for integration has come not only from the top. Market forces, by themselves, also tend to worsen existing inequalities among countries. But for the most part they did little to increase trade or other interactions among African countries. “International Technology Transfer and Economic Development.” At a week-long African Development Forum (ADF) organized by the ECA in Addis Ababa, Ethiopia, in March, many participants from civil society and business organizations expressed great frustration over their virtual exclusion from existing regional institutions (see Africa Recovery, April 2002). He cited the example of the East Asian countries, where government partnership was vital for helping local businesses develop to the point where they could compete globally. At the same time, integration facilitates large-scale investment by "reinforcing the attractiveness of our economies and reducing the risks.". Wider regional markets can open up more opportunities for African producers and consumers, beyond the sometimes small markets within their own borders. Others urged caution. Metadata Show full item record. Prof. Ali el-Agraa, a Sudanese expert on regional integration who now teaches at Fukuoka University in Tokyo, notes that "whatever you do is going to be imbalanced," since countries have different capacities and starting points. And with so many African countries at war, says former OAU Secretary-General Salim Ahmed Salim, peace must also be a central element of any integration strategy. He insisted that Africa abandon its "inward-looking" approach of the past, and instead adopt a course of "open regionalism" to realize the benefits of global integration. Historically, formal economic and social integration in the East African Region commenced with, among other things, the construction of the Kenya-Uganda Railway from 1897 to 1901. Thirdly, education and cultural exchanges have the potential to enhance regional integration for the benefit of all members. Business, comment, In The Magazine The importance of regional economic integration is a very pertinent issue in Africa, particularly in light of existing political and economic weaknesses. Over the past decade, regional organizations around the world have been devoting increased attention to the problem of internal displacement. After Nkrumah’s fall from power, other African leaders took up his goal of building the United States of Africa, based on the Organisation of African Unity. Specifically to promote greater private sector involvement in regional integration, the ADB is supporting an initiative known as the African Business Roundtable. Benefits of Regional Economic Integration. Third, all nontariff barriers on trade of goods and services should be removed on a most-favored-nation basis. In book: Region-Building in Africa (pp.37-52) Authors: John Ravenhill. Much discussion in the literature concerns the study of regionalism in Africa, which suggests the concept’s continued importance to both analysts and practitioners (Akokpari, 2008: 85-6; Grant and Söderbaum, 2003). Therefore, a key challenge facing African leaders over the coming years will be to find ways to rationalize the continent's "plethora of integration institutions. February 13, 2019 Marinov, Eduard (2013): Impact of the European Union on Regional Integration in Africa. It also enabled donor countries and international financial institutions such as the International Monetary Fund (IMF) and World Bank to push through a major shift in economic policies. The idea of better integrating African countries and regions has long been promoted by political leaders in speeches, official conferences and formal treaties, although with only limited results on the ground. Integration cannot be achieved by relying strictly on political initiatives or focusing narrowly on economic dynamics. A single African currency may seem a "crazy" idea at the moment, Mr. Ciss believes, but will one day become a reality. Yet their sale satisfies consumer needs and provides livelihoods to thousands of small-scale traders in market-places across the country. Africa is infested with the deepest levels of poverty, lowest share of world trade, and weakest development of human capital and infrastructure, to say the least. Deeper market integration for goods, infrastructure services, and key factors of production (labour and capital) is especially important – both economically and strategically – for Africa’s small and fragmented economies. View/ Open. Since a regional common market obviously provides a much larger market than that offered by the domestic market of a single country, economies of scale, both internal and external, become possible with the widened size of the market. The healthy effects of such a regional economic integration are presumed to be as follows: 1. Regional economic integration can be further enhanced in fields like energy and infrastructure. There is good reason for their involvement. The The OAU subsequently adopted a series of treaties to make economic integration a reality. Similarly, wars within the Mano River Union (MRU), made up of Guinea, Liberia and Sierra Leone, also brought poor performance initially, although integration advanced somewhat in the later years as fighting subsided in Liberia. 4. By boosting intra-continental trade, consumption, and investment, regional integration can be a strong vector for improving productivity, building manufacturing powerhouses, and developing credible African brands. With assistance from the UN Development Programme, the Roundtable has started an "e-commerce" project to help African businesses gain easier access to Internet communications. -- rationalizing Africa's many different regional institutions, to reduce overlap and inefficiency. Africa must unite not simply to enhance the continent's weight in global affairs, they say, but also to meet the very real needs of its people. "I want to see intra-African integration," says Mr. Amoako, "not because we will garner some utopian share of world commerce, but first and foremost because it will improve our lives here. The benefits of belonging to a shared community in southern Africa are reaching the lives of many people in the region, according to a new publication released by the Southern African Development Community. Each of the sectors is weighted -- with trade given a weight of 34 per cent and transport 15 per cent -- in the calculation of the index. The mutual connections between regional security and the economy relate particularly to the geographical constitution of the Horn of Africa. It will free up the time of African businesspeople to do business here. Deeper market integration for goods, infrastructure services, and key factors of production (labour and capital) is especially important – both economically and strategically – … The Communauté Economique des Pays des Grands Lacs (CEPGL), comprising Rwanda, Burundi and the Democratic Republic of Congo, fared the worst, in large part because of the incessant wars that have afflicted the region. For Africa, a vast continent of over 1.2 billion people, integration has considerable potential not only for promoting robust and equitable economic growth through markets, but also for reducing conflict and … The advantages are numerous. Finding ways to overcome such inequities must be consciously negotiated by governments, he said. Why, then, devote limited financial resources to building costly infrastructure aimed at integrating the continent? When they join larger regional groupings, "what can small states expect in exchange?" Algeria contributes to 42% of regional GDP but is not a top performer in regional integration, with Morocco and Tunisia ahead in regional integration scores. The Strategic Aims of Regional Cooperation and Integration in Africa Dot Keet Alternative Information and Development Centre AIDC Regional Briefing 1/2004. In recent years, the concept has acquired greater urgency, dramatized by the formal launching of the African Union this July (see "The African Union is launched"). Tags Célestin Monga Economic Integration Nkrumah, Your email address will not be published. The integration of Africa may be a complex process, but the stakes are high, and will ultimately determine "our political and economic future.". This includes not only opening them up to greater participation by civil society groups and local business interests, but also streamlining the continent's confusing multiplicity of organizations. (function(){ "The minimalist approach to the role of the state is not right," South African Transport Minister Dullah Omar said at the Addis Ababa forum. Building more links among African countries is essential for the continent's economic progress. "I want to see intra-African integration, not because we will garner some utopian share of world commerce, but first and foremost because it will improve our lives here. Throughout the ECA forum in March, participants emphasized the importance of moving toward integration at a more determined, systematic pace. ", The goal, Mr. Amoako adds, should not just be to reduce unnecessary costs. The Southern African region provides a good example of what has been achieved so far on the continent. Inequalities in production will tend to create unsupportable trade imbalances....". But the work is not done. Published in: Financial and Monetary Economics – EFM 2013 No. The domestic private sector has rarely been mentioned in African regional integration plans, noted Mr. Taingam Bekoutou, director-general of Chad's Chamber of Commerce and Industry, nor has it been consulted about the taxes imposed on African businesses. It will free up the time of African businesspeople to do business here. If we do that, others will come.". Given such market shortcomings, many advocates of regional integration now emphasize that government must not be further cut back, but should play an active part. For regional integration in Africa to be a success, Africa’s leaders will have to move beyond grand gestures and abstract visions. The Independent Many countries continued to deal most extensively with their former colonial powers. Motivation of virtually all regional economic integration (REI) initiatives has been prospect of enhanced economic growth. Not only have they not been consulted, but many Africans encounter constant problems in travelling or dealing with people in neighbouring countries. More links among African countries within their respective RECs and also with the rest the... States expect in exchange? size of many countries and the intra-EAC trade volume is dramatically! 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