CTTTFP

A major constraint to economic development, poverty alleviation and job creation in the COMESA-EAC-SADC region of Africa is the high cost of doing business, including the costs arising from moving traded goods across border crossings. 

Trade Facilitation refers to improvements to procedures governing the movement of goods across borders in order to reduce the cost of trade, maximise efficiency and safeguarde legitimate regulations.  

The cost of transport, in particular road transport, is directly related to the time taken for a journey.  The longer a journey takes, the higher the transportation costs - which lead to higher production costs, less competitive member states and a less competitive region.

Until the underlying causes of the high costs of trade and transport in Africa are addressed, African countries will remain high-cost producers, with no major direct investments taking place in non-mineral sectors, restricted economic growth opportunities and slow progress being made in poverty alleviation.

In an effort to address these challenges the Member States of the three Regional Economic Communities (RECs) of the Common Market for Eastern and Southern Africa (COMESA), the East African Community (EAC) and the Southern African Development Community (SADC) launched negotiations for the COMESA-EAC-SADC Tripartite Free Trade Area on 12th June 2011.  The Tripartite Free Trade Area aims to reduce tariffs imposed on goods originating and traded in the region.

However, in addition to tariff barriers, the region’s producers and traders also face a number of non-tariff barriers and high cross-border trade and transport costs.  An integral part of the Tripartite Free Trade Area is the design and implementation of a trade facilitation programme that is aimed at improving trade and transport measures and reducing non-tariff barriers to trade.

While COMESA, EAC and SADC have had some successes in trade facilitation through individual REC programmes, there have been challenges, including the requirement to implement different trade facilitation programmes and different instruments in countries that belong to more than one REC.

To address these challenges the COMESA-EAC-SADC Tripartite has launched the Comprehensive Trade and Transport Facilitation Programme (CTTTFP) which is a series of initiatives from different Regional Economic Communities that have been brought together into one large integrated trade facilitation programme.  TMSA provides support on the following CTTTFP projects:

Projects

Development of Regional Bond Guarantee Scheme and Transit Information Management System

TMSA is providing support to the development of a SADC / COMESA regional bond guarantee scheme, as well a regional transit information management system.  Benefits will include

  • transparent and predictable regulatory requirements,
  • harmonized documentation and procedures for cross-border transit movements,
  • use of a single regional customs bond,
  • electronic exchange of information by customs authorities that facilitates better risk management - leading to more efficient customs clearance processes and reducing delays at border crossings.
Harmonising 3rd-Party Motor Vehicle Insurance

The COMESA Yellow Card is a vehicle insurance scheme that covers third-party liability and medical expenses. A Yellow Card issued in one COMESA country is valid in all other countries participating in the scheme. This saves time and money, because insurance does not need to be taken out anew each time a border is crossed.

A Fuel levy system fulfills a similar objective in SACU countries, while in some other countries a cash payment system is used.

COMESA, EAC and SADC have established a programme to harmonise the third party vehicle insurance schemes and it has determined that considerable benefits would accrue if the Yellow Card Scheme and the Fuel Levy system were to be harmonised.

TMSA is supporting the Tripartite to develop legal instruments, an institutional framework and supporting procedures to interface the Yellow Card Scheme and the Fuel Levy system to enable seamless cross-border transport movements.

Harmonizing Road User Charges

Levying of Road-User Charges (RUC) is a mechanism through which road users pay to use an area of road.  TMSA is supporting the COMESA-EAC-SADC Tripartite to harmonize these approaches to recovering maintenance costs of roads throughout the region. 

To date, COMESA Member States have agreed on an across the board fee of $10 for every 100km travelled while SADC Member States have a agreed on a formula that calculates the road user charges based on parameters whose values vary per country. 

The SADC formulae has been accepted by the Tripartite as the best base for recovery of road maintenance costs.  The SADC RUC study will be extended to all Tripartite countries in order to determine a tripartite-wide base for road user charges in the region.

Harmonizing Vehicle Regulations and Standards

The harmonization of road traffic regulations and standards is an important element of the drive towards a regional road transport market. Differences in vehicle safety and equipment standards compromise the efficiency of cross-border operations as operators are forced to use different configurations for different markets. Standardisation or harmonisation is therefore important to the development of an integrated regional transport market.

COMESA, EAC and SADC have agreed on maximum vehicle dimensions, in terms of height, width and length of vehicles. Member States have agreed to these maximum vehicle dimensions at the regional level. However, few countries have passed national legislation to enforce this instrument and even fewer countries actually implement this instrument.

The Tripartite are also jointly working on a programme to harmonize vehicle regulations and standards with respect to fitness of vehicles, transportation of dangerous goods and transportation of abnormal goods.

Related publications:
Improving Customs Legislation and Procedures

Regulations on cross-border trade as well as actual border post operations present major obstacles to the efficient and affordable movement of goods by road. TMSA provides support to the Tripartite on improving customs and Cross-Border Legislation & Procedures.  Specifically, the areas being addressed are:

  • simplifying and harmonizing customs legislation and procedures;
  • streamlining and improving the efficiency of operations at border crossings;
  • adoption and implementation of standardised customs documentation;
  • development of a regional customs enforcement network that will allow effective use of risk management to facilitate faster clearance of legitimate trade
Integrated Border Management

Integrated Border Management (IBM) has been defined as: “national and international coordination and cooperation among all the relevant authorities and agencies involved in the protection of the interests of the state at the border to establish effective, efficient and coordinated border management, in order to reach the objective of open, but well controlled and secure borders”. (SADC Guidelines on IBM)

TMSA is supporting the Tripartite in developing a policy and strategy for implementation of IBM in the region. This will be followed by technical and financial support to implement IBM at Tripartite, regional and national level.

Implementation of IBM along trade corridors in the region should benefit the countries of Southern Africa and the adjoining regions. It will, among other benefits:

  • Improve management of border agencies and clarify responsibilities and accountability of border agencies
  • Remove inter-agency rivalry and duplication of resources
  • Facilitate trade, transport, tourism and foreign investment
  • Provide for overall single ownership of the responsibility for border efficiency
  • Contribute to the success of regional and national cross-border facilitation projects like those for implementing Single-Window and One Stop Border Posts
  • Facilitate implementation and accession to various international instruments concerning facilitation of cross-border formalities
Joint Competition Authority on Air Transport

The Yamoussoukro Decision is a vitally important policy initiative for air transport reform in Africa.  It recognises that restrictive and protectionist regulatory regimes hamper improvement and expansion of African air transport.

During the Tripartite Summit of Heads of State and Government on 20 October 2008 in Kampala, Uganda, the Joint Competition Authority (JCA) was launched to oversee the full implementation of the Yamoussoukro Decision on Air Transport in the three RECs - commencing January 2009.

The JCA is charged with the overseeing the full implementation of The Yamoussoukro Decision in the three Regional Economic Communities (RECs) as provided for in the Regulations for Competition in Air Transport Services, 2004, and the Guidelines, Provisions and Procedures for the Implementation of the Regulations for Competition in Air Transport Services within COMESA, EAC and SADC, 2006.

TMSA is supporting the Tripartite to develop a framework for operationalising the JCA in accordance with the Competition Regulations 2004.

Promoting Self Regulation through a Regional Transporter Accreditation System

Many of the region’s transport delays can be attributed to bureaucratic delays caused by the need to check on compliance (such as customs inspections, weighing trucks, document checks at police road blocks, etc.)

One way to reduce these delays would be to introduce a transporter accreditation system. Qualifying transporters would commit to comply with cross border clearance processes and would then be exempt from regular compliance checks during a transit movement.

In order to ensure compliance, however, a system of spot checks would be implemented. If an accredited transporter were caught contravening the regulations he would face severe penalties and lose his accredited status.

TMSA is supporting the Tripartite to design a legal framework, institutional arrangements, standards and auditing and accreditation procedures that would facilitate a system for accredited transporters.

Road Transport Market Liberalization

The Regional Economic Communities of COMESA, EAC and SADC have, for a long time, emphasized the importance of a "regional carrier’s license". This single license for commercial goods vehicles would be valid throughout the region and would allow vehicles to operate in all Tripartite member states. Practically, the adoption of such an instrument would mean that vehicles could carry "back-loads". In other words, after delivering a load, another load would be carried on the way back from the truck's destination. This would significantly reduces the cost of trade by allowing for a more efficient use of the region’s transport fleet.

TMSA is supporting the Tripartite to review the bilateral road transport agreements in existence between Member States and to recommend a way forward towards establishing a multilateral agreement.

It is envisaged that simplification and further liberalisation of the terms of market access will facilitate the creation of a cross border Operator Card or regional license similar to the COMESA Operator License.

Vehicle Overload Control

According to a report by the Sub-Saharan Africa Transport Policy Programme, authored by Michael Ian Pinard:

"Heavy goods vehicle overloading is a serious problem across much of Sub-Saharan Africa. Such overloading not only significantly accelerates the rate of deterioration of roads but, when coupled with inadequate funding for road maintenance, it contributes significantly to poor road conditions and high transport costs. The indicative cost of overloading in East and Southern Africa has been estimated at more than US$4 billion per annum. This exceeds the amounts being spent on road rehabilitation. Therefore, unless the problem is tackled head on, it will negate the expected benefits from the huge amounts of resources that countries and donors are investing into improved road infrastructure across the continent. The cost associated with vehicle overloading can be avoided through effective control measures."

In order to preserve the road infrastructure and ensure reasonable usable life times, countries in the COMESA, EAC and SADC have agreed the following axle load limits for freight vehicles. Not all countries apply these axle-loading limits so the load weight on a freight vehicle will be limited to the load which is in compliance with the lowest axle load limit along the entire route. Unless the problem of overloaded axles and gross vehicle masses is positively addressed and resolved the current initiative to improve the efficiency of the region’s road transport systems will not be sustainable.

The proposed list of activities under this initiative includes:

  • Design and promotion of a model law on axle loads and vehicle dimensions including guidelines for the permission to use heavy vehicles on the region’s trunk roads, regulations for weighbridge devices and their use, capacity building for weighbridge staff, calculation of load and procedures and legal consequences and payment and guidelines for abnormal loads and preparation of guidelines that can be used by each country in the Tripartite region; and
  • Defining of “strategic” weighbridges along corridors and linking these weighbridges electronically so that a system can be designed that will allow vehicles to be tracked as they move along the corridor using radio-frequency identifiers (RFIDs) or similar technology so as to reduce the level of overloading as well as reduce the level of unrecorded trade.

Comprehensive Tripartite Trade and Transport Facilitation Programme

Early Closure of TMSA Programme: The Secretary of State of the UK’s Department for International Development (DFID) has decided to terminate its financial contribution to TradeMark Southern Africa (TMSA), as announced on 4 December 2013. As DFID is the sole financier of the TMSA programme of support to the COMESA-EAC-SADC Tripartite, TMSA will officially be closed from 17 March 2014 instead of 31 October 2014. For more information about the TMSA closure, and for a summary of some of the more notable successes of the Tripartite achieved with TMSA support, please click here