One Body, One Cause:Hinging SADC integration hope on political will

Lusaka ‑ The success of the 15-year regional master plan of the Southern African Development Community (SADC) depends on the goodwill of the leaders in member states, says SADC deputy executive secretary in charge of infrastructure, Joao Caolo.

SADC would establish a revolving fund to foster infrastructure development in the region, as the regional bloc seeks to join hands with other partners including the, Common Market for Eastern and Southern Africa (COMESA) and East African Community (EAC) to form a single market.

The Regional Infrastructure Development Master Plan (RIDMP) would lure potential investors into the rolling-out of its Vision 2027, the 15-year blueprint, which is expected to guide the implementation of cross-border infrastructure projects between 2014 and 2027.

Under the programme, various infrastructural programmes involving road building and upgrading, ports, bridges, railway, energy, tourism and agriculture will be championed with an increased budget in excess of US$500 billion.

The RIDMP was adopted by SADC Heads of State and Government at their 32nd SADC Ordinary Summit held in August 2012 in Maputo, Mozambique, to promote cost-effective trans-border trade.

With many critics chiding SADC over lack of political will among its leaders, the regional bloc has an alternative to raising capital for its planned infrastructure rebuilding programme, besides depending on donor support, according Caolo.

Caolo explained that member states have been implored to contribute an overall 51 percent towards starting a US$1.2 billion regional development revolving fund to accelerate infrastructure development.  

The private sector was expected to contribute 37 percent with co-operative partners raising 12 percent of the finances.

“We expect all member states to show political will and contribute towards the fund because it will be theirs,” Caolo told journalists on the sidelines of the 33rd SADC Heads of States Summit held in Malawi in August 2013.

“We realise that the best way to make regional integration is to ensure that we have reliable funds for our member states to access for capital projects and ensure various infrastructure is built or rehabilitated to accelerate trade growth in the grouping one we join hands,” Caolo said.

In recent years, various donors including the World Bank supported SADC in various projects by providing more than US$94 billion for infrastructure development in the region. 

Other donors instrumental in driving the SADC agenda include the Africa Development Bank, Development Bank for Southern Africa and International Monetary Fund (IMF).

On the envisioned regional integration, Caolo says discussions are underway among regional leaders of COMESA and EAC for an accelerated trade agenda that will see Africa compete effectively with foreign markets.

In spite of the goodwill from donors, the region has been clouded out by various factors including civil strife in various member countries, for example, the Democratic Republic of Congo (DRC), which have stunted regional growth, Caolo argued.

On the envisaged deadlines for regional integration by SADC, COMESA and EAC member states expected to be finalised by 2018; Caolo brushed this aside saying it is unattainable. 

He urged member states to work fast though at their own pace in the programme despite various challenges expected before actualisation like the case of the European Union.

“Those deadlines are not realistic because each country and regional grouping has its own bottlenecks ranging from finances, administration and other unforeseen tariff and non-tariff barriers that need to be harmonised among each other before we can safely say we are ready for one body and one common cause,” Caolo added.

Analysts have indicated that the intention by SADC to generate its own funds through the revolving fund can succeed depending on the goodwill of the leadership in member countries. 

Analysts stressed that there are other available options to raise capital for such projects.

These includes raising resources through floating euro or government bonds like the case of Zambia which raised US$750 million from euro bond to raise capital for infrastructure development.

Other options include raising equity through capital markets or bourse through Public Private Partnership (PPP) initiatives, internal revenue taxation methods as well as generating raising resources through increased bilateral trading among member states.

Zambia-based international trade expert, Trevor Simumba, has strongly urged the SADC, COMESA and EAC leadership to apply political will in raising resources for capital projects as a yardstick in accelerating the implementation of the regional integration programme for a “common and developed future” for Africa.

Simumba further laments the high cost of doing business in all regional blocs which remains a serious challenge in the absence of reliable infrastructure and urged leaders to maximise their capital markets and other avenues to generate own resources and reduce dependence on the donors, many of who have internal financial problems.

“Regional integration needs political will in which all member states should be prepared to accept to lose some of their sovereignty on trade because this is one of the key barriers to trade,” he said. 

“The leaders in all the three blocs should be prepared to diversify from their traditional practices of doing business.

Arvid Krishnan, an economic expert and procurement manager at Plem Construction – an import and export consulting agency has bemoaned the poor infrastructure which was another cost addition as it is affecting business growth prospects.

“Much of the infrastructure is in bad state and is affecting business in the region making it more expensive,” says Krishnan. 

Other experts argue that although the success of the SADC’s master plan will enable the region to drive the trade, economic and financial development programmes, many countries are riddled with external debts, which forces them to expend in repayment than what would be set aside for such major projects.

This sentiment was echoed by SADC Chairperson and Malawian President Joyce Banda who promised to ensure that regional integration among the three key regional blocs is achieved.

President Banda regretted that presently many of the people in SADC have lost hope of a better future as they continue wallowing in abject poverty amid the region’s abundant mineral and natural resources, which remain untapped to alleviate poverty. In her acceptance speech as new regional leader during the 33rd Heads of States Summit in Lilongwe, she called on all member states to support the regional integration agenda and assist promote harmonised trade among the three groupings when they start working together.  

“Regional integration is our only hope as SADC to better the lives of our people. 

“We need to promote regional integration with various diversified programmes so that we reduce the poverty that our people are faced with,” she said.

President Banda implored Africa to promote the growth in the agricultural sector, which will in turn promote self-reliance through by exploiting new markets for increased trade. 

Under her reign, she envisages to pursue an accelerated trade negotiation programme with major foreign markets for various goods and services in SADC to ensure its people have hope in their leadership.

“I’m hoping to see the regional integration programme tackling the free movement of people across borders, harmonise various trade regimes and I would also work towards ensuring that the SADC master plan, all trade protocols and agreements are fulfilled and ensure that the poor people-women, children and the youth see hope in us leaders,” she said.

September 2013
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