ECOWAS urged to strengthen regional integration by reducing non-tariff barriers to trade
Trade experts have called on member countries of the Economic Community of West African States (ECOWAS) to step up efforts to minimise burdens that non-tariff measures (NTMs) place on businesses in the region.
At a June 14-15, 2016 meeting in Côte d’Ivoire’s economic capital, Abidjan, the experts highlighted that countries needed to diversify and increase their portfolio of exports, set up trade obstacle alert mechanisms, and standardise technical and regulatory requirements.
The event, organised by the International Trade Centre (ITC) and the African Development Bank (AfDB) had a series of business surveys on NTMs in Benin, Burkina Faso, Côte d’Ivoire, Guinea, Mali and Senegal, carried out by ITC. These explore and identify how NTMs hinder the smooth flow of goods across sectors and markets.
The surveys indicate that majority of obstacles faced by businesses apply to both countries within ECOWAS and partners. In fact, in the six surveyed ECOWAS countries, 73% of the firms surveyed agreed that they faced burdensome NTMs (on exports and imports) both within and outside the ECOWAS region. Around 26% oppressive NTMs were reported by agriculture exporters who encountered them in their respective home countries. In the manufacturing field, 32% of NTM cases recorded are related to obstacles faced in the various ECOWAS member countries.
For businesses in the manufacturing sector, the surveys found that common obstacles arise in relation to rules of origin and the issuance of certificates of origin – both of which are critical in determining the tariff treatment which traded goods qualify for. Meanwhile, in the agriculture sector, conformity with health, safety, and other technical requirements is one of the main obstacles to trade. Conformity assessments include product certification, inspection requirements as well as registration processes.
Commenting on the findings of the NTM surveys, Aicha Pouye, Director for Business and Institutional Support at ITC, said: “The average cost of importing a container is 25% higher than the world average, two times higher than in OECD countries and three times higher than in Southeast Asia. Addressing this and other issues related to NTMs is crucial if we are to achieve long-term and sustainable growth across the ECOWAS region.”
“These surveys on NTMs are a further step towards bringing down barriers to growth across the ECOWAS. Together with the AfDB, the ITC will continue supporting African countries in their efforts to ensure that trade becomes a viable tool in eradicating poverty,” she said.
Another common finding of the NTM surveys relates to procedural obstacles. They found that many challenges are directly linked to delays and high costs of compliance and clearance procedures, often because local authorities lack modern equipment.
Stefan Nalletamby, the Acting Vice-President for Infrastructure, Private Sector and Regional Integration at the AfDB, underlined that ‘most of the bottlenecks are related to application procedures, which directly hamper regional competitiveness. These, he said are a major obstacle to regional integration and economic development in Africa’.
He added: “African governments have shown great commitment in putting in place clear and well-intended regulations, now all our efforts will be directed towards the implementation process.”
Pointing to the enormous untapped potential for economic growth in the ECOWAS region, the reports recommend the streamlining, and where applicable, removal, of NTMs across the member states. This, the surveys indicate, will promote lower trade costs, which are a powerful tool to strengthen regional integration.