The Private Sector's Perspective, Priorities and Role in Regional Integration and Implications for Regional Trade Arrangements

Regional trade arrangements in Southern and Eastern Africa have been characterised by countries’ multiple and overlapping membership in different regional integration initiatives. With COMESA, EAC and SADC each being mandated by their member states to become customs unions, the pattern of overlapping memberships becomes impossible to maintain – unless COMESA, EAC, SACU and SADC effectively adopt the same common external tariff. Overlapping multiple agreements would not be such a problem if an overall plan was in place to synchronise the common external tariff of the groups so that in the end they would form one large trading bloc. However, no such long-term plan appears to be in place, other than the stated ultimate goal of establishing the African Economic Community (EAC) by 2025.1 Therefore as each of these regional groupings moves along the path towards deeper integration, their members will have to decide which best serves their interests. The negotiation of economic partnership agreements with the European Union has catalysed this decision-making process.

Several studies have addressed the issue of regional trade arrangements and overlapping memberships. However, the question has yet to be looked at from the private-sector perspective. Given that companies, not countries, trade and invest and that the objective of trade policy is to shape companies’ incentives so as to engender growth and development, their perspective is central to any attempt to assess regional integration. Hence the private sector, in terms of their perspectives and priorities for regional integration, is the main focus of this study.