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EUROZONE CRISIS IS ACTING NEGATIVE INFLUENCE ON AFRICA - AUTHORS

EUROZONE CRISIS IS ACTING NEGATIVE INFLUENCE ON AFRICA
Author: AUTHORS |
Date: 28 / 01 / 2012
by Shao Haijun
JOHANNESBURG, Jan. 27 (Xinhua) -- The African countries should reduce the trading cost in order to boost intra-Africa trade as the Eurozone crisis is casting negative influence on the continent, a senior African researcher said in an exclusive interview with Xinhua.
"In face of Europe debt crisis, the imports of Europe taking from Africa are quickly reducing. Some of the emerging market are picking up the flag. (But they) also are influenced by the Eurozone crisis. That's also why we need to increase intra-Africa trade," Matlotleng Patrick Matlou, the chief executive officer of Africa Institute of South Africa (AISA) told Xinhua in a telephonic interview on Thursday.
AISA is established in 1960 and it has been voted the sixth leading think tank in sub-Saharan Africa in the 2011 Global Go To Think Tanks Survey, released on Jan. 20, 2012.
The Ordinary Summit of the AU will address the theme of "Boosting Intra-African Trade" in Addis Ababa, Ethiopia from Jan. 23 to Jan. 30, an event during which it seeks to launch a Continental Free Trade Area (CFTA) to explore solutions for easing trade among African countries.
"It is indeed Africa is not like any parts of the world. Intra- Africa trade is only around 10 percent of total Africa trade." Matlou said.
"Africa countries producing the same kind of products; they produce merely raw materials." He said.
At present, many Least Development Countries (LDCs) and Low Income Countries (LICs) especially in Africa rely on the export of natural resources. This is largely capital intensive, and provides few opportunities for employment or development.
Matlou said the most significant factors in blocking intra- Africa trade is the high trading costs such as transportation, boarder immigration control, tariff and non-tariff barriers.
"It costs more to transport a container from South Africa to central Africa than that container from Europe, India or United States," He said.
The 18th AU Summit is expected to discuss how to strengthen trade among African countries, with the hope that this continent's economic performance can be improved.
"Boosting Intra-Africa trade will open up and create large markets, foster greater competition, which in turn will lead to growth and sustainable development," the AU said in a statement.
"African countries are growing five percent last year, which is significant in the context of global downturn, and this provides and requires more opportunities for Africa countries to increase their trade," Matlou said.
Meanwhile, Some of Africa's leaders have urged closer co- operation within the continent on energy and infrastructure projects to help its growth prospects at the World Economic Forum in Davos in Switzerland.
Last June, leaders from the Southern African Development Community (SADC), the Common Market for Eastern and Southern Africa (COMESA) and the East African Community (EAC) met in Johannesburg, South Africa to launch the negotiations of Tripartite Free Trade Area (T-FTA). The decision involving 26 countries, 530 million inhabitants, and 630 billion U.S. dollars GDP, comes at a time of renewed commitment for achieving the African Common Market.
This initiative reflects the determination to go beyond the implementation of regional trade agreements and the elimination of all kinds of barriers in the direction of expanding the trade framework at the continental level.
"African countries got the advantage of multilateral agreement signed between Africa and other countries. We can use these treaties as the base to try to see how individual country or group of counties to come together to improve production capacities." Matlou added.
He also urged Africa countries to improve their airline connection, develop infrastructure and reliable energy to create a special economic zone, while integrating the foreign aids.
"We African countries can improve the trade," He said.