Wealthy commonwealth nations should increase trade partnerships with African member countries to increase their integration to the global economy.
Investment in vital infrastructural facilities would make a substantial impact on exports and strengthen the resilience of Africa’s member countries’ economies to shocks.
Speaking on the sidelines of the UNCTAD 14’ during The Commonwealth Ministerial meeting, Principal Secretary, State Department of Trade, Dr. Chris Kiptoo said the capital intensive infrastructural facilities are a trade barrier between to increased exports and imports between the partner nations.
“While the continent is spending over $131 billion on infrastructure-related construction which is expected to grow to $200billion by 2015, there’s an existing funding gap that needs to be addressed,” said Dr. Kiptoo.
The 53 countries that make up the Commonwealth represent nearly one-third of the world’s population, a quarter of the world’s governments and one-fifth of all global trade.
“It is valued that annual intra-Commonwealth exports of goods at more than $US225 billion. Coupled with research that shows that a 10 per cent improvement in trade-related infrastructure would raise the volume of exports to other Commonwealth countries by about 62 per cent, trade would between the members countries would improve,” said Dr. Kiptoo.
While crediting The Commonwealth for the technical and analytical support for developing countries on the Doha Development Round negotiation, Dr.Kiptoo urged the Secretariat to help Africa’s responses to the changing international trade environment.
“Africa is not involved in any of the mega-regionals trade agreements, the most significant of these trade agreements being the Trans-Pacific Partnership (TPP) agreement,” said Dr. Kiptoo
And added: “The risk is that new rules and market access preferences agreed under these trade agreements will make it increasingly difficult for African businesses to compete globally, confining Africa to a shrinking share of international trade and diminish its attractiveness as a destination for investment.”
He recommended that individual Commonwealth countries should negotiate favourable bi-lateral trade deals between themselves as long as they have comparative advantages, citing Kenya’s business reforms and economic transformation intent.
He said Kenya is systemically re-engineering its economic environment – managing external economic shocks, sustaining domestic growth, supporting human development, investing in infrastructural transformation, consolidating governance gains and creating comparative advantages and strengthening regional partnerships.
“The true reflection of these reforms in the short-term has been increased investment in the country,” he added.
Kenya’s efforts to reforms were vindicated by several global organizations as among the top places to do business in Sub-Saharan Africa.