Human (in)security: Can the AU accelerate intra-Africa trade?

By Zukiswa Mqolomba

According to the latest Human Development Report, sub-Saharan Africa countries, even those classified as middle-income countries, have disappointingly low human development indices (HDIs). HDIs are worse in Africa’s conflict zones.

A reading of the literature suggests three things in order to boost intra-Africa trade:

Firstly, a key tenant lies with navigating the inherent contradictions of the strongholds of the old, closed regionalism of the 1960s, towards the new interdependent and Pan-African regionalism that benefits all.

Secondly, strengthening the institutional aptitudes of regional communities in an effort to achieve Africa’s critical socio-economic milestones, namely economic rebuilding, accelerated economic growth and social cohesion.

Thirdly, efforts should not merely focus on economic growth but ensuring that economic growth has the resultant effect of improving the living conditions of the majority of ones citizenry. In order to move towards a trajectory of meaningful intra-trade, a conceptual policy shift has to be made: one that moves beyond quantitative concepts of growth but to beneficiation strategies as well.

Recommendations to the African Union
The AU should consider the following:

1. How regional economies can capitalise on the opportunities to create new high-end/high-value markets such as, new energy industry/green economy, bio-industry, high-end equipment and manufacturing, new material industry, new-energy vehicles, next generation IT industries and/or form part of its supply value chain to the benefit of its own economies.

2. How regional economies can protect infantile/emerging industries from the risks of trade liberalisation/deregulation and excessive foreign competition on African soil, while maximising opportunity(s) for expanding regional economies by attracting new markets and/or investors, as well as (re)building new industrial capabilities.

3. How Africa can leverage Afro-Sino trade relations in ways that ensure mutual benefit as a lived reality. A closer look at China’s trade investments tends to be worrisome. China’s trade activities are largely extractive in nature with state-owned enterprises typically invested in resource extractive activities no different from Western involvement in the energy and mining sectors. Cheap imports are also held responsible for the decline of local industries. Chinese factory floor interface has also left much to be desired.

4. How regional economies can build, expand and leverage community-based enterprise (co-operatives), micro and small enterprise networks to boost intra-Africa trade, maintaining a particular focus on women and youth.

5. How efforts to boost intra-African trade can address the structural risks of market economies, underlying systemic vulnerability (ie market duality, economic marginalisation and social exclusion etc), which undermine trade by reproducing poverty and unemployment despite economic growth. Sources of risk (income, consumption and asset-based deficits) are not exogenous to their socio-political context. Transformative mechanisms must be quintessential components of any meaningful strategy to boost a type of trade that will address livelihood risks and other vulnerabilities for all.

Towards African unity
Africa currently has eight regional economic blocs, with two or more in almost all sub-regions. Of the 53 African countries, 26 are members of two regional economic communities, and 20 are members of three. It is not surprising that many have argued against multiple regional membership, as well as uniform/untailored membership, which have introduced geo-political asymmetries between regional economic economies, as well as reinforced the asymmetries between nation states assigned only on the basis of geography. While there are those who argue that the overlapping of membership/multiple membership accelerates regional progress towards continent wide integration, there are those that argue that asymmetries hinder regional integration through duplicating efforts, as well as by creating conditions of competition between states. Some have argued that multiple membership could maximise the benefits of integration and minimise the losses by spreading risks. Some studies, however, have pointed to the difficulties posed by multiple and overlapping membership. The overlap is said to dissipate collective efforts towards the common goal of the African Union. Moreover, it tends to undermine the goals of integration, leading to counterproductive competition among countries and institutions.

In this context, Noel Moukala of Renaissance Africaine affirms the centrality of African unity as a cornerstone of African Renaissance. Undoubtedly, there will be no African renaissance without African unity. It is only when Africans overcome their differences to unite that they can then talk about African renaissance. Undoubtedly, as Thabo Mbeki noted, “[t]he cohesive efforts of our entire society is needed to enable Africa to face the legacy of the colonial and neo-colonial past and to face the challenges posed by the new millennium.”

Africa has made attempts to use regionalism as a strategy to address its growth challenges. However, there are evident structural disarticulation regional and continental bodies, a crucial paradox in Africa’s overall regional and multilateral engagement.

The AU should therefore also:
1. Develop a decisive strategy and/or guidelines that will enable nation states to manage contestation between domestic and regional demands, as well as reluctance by states to supersede the right to state sovereignty in favour of regional interests.
2. Establish an inter-regional task-team that will develop a targeted yet integrated approach in assisting individual governments in translating regional commitments in national policies and actionable programmes.
3. Leverage the African Peer Review Mechanism and/or other monitoring and enforcement mechanisms that will promote adherence to regional commitments.
4. Develop a decisive strategy that will resolve the growing lack of funding and/or effective external guarantor to carry the burden of costs of the integration project.

Critical questions
Some critical questions should remain at the fore of discussions:

• Bearing in mind evident regional disparities in human development indicators, in what ways have regional blocks served to reinforce disparities? Have regional blocs served as building blocks or as stumbling blocks towards intra-Africa trade that benefits all?
• Does regional overlap lead to losses or gains in economic efficiency? What have been the benefits and trade-offs? How can we overcome unintended consequences?
• How can regional communities enforce regional commitments, while balancing the rights to state sovereignty? Should regional communities be given supranational authority to enforce common decisions or should they make use of alternative incentive mechanisms to do so?
• In Africa’s long-term bid to integrate into a formidable “economic whole”, what lessons can we learn from the trajectories of the European Union and/or the East Asian blocs, if any at all?

Clearly, as a consequence of the real challenges facing post-colonial states, including the threats to Africa’s re-colonisation, the AU is expected to play an important frontline role in the decade ahead. For this reason, it seems appropriate that a stock-taking and prospective reflection should be undertaken on continental strategies for promoting inter-continental co-ordination and development for enhanced intra-trade in addressing Africa’s human (in)security challenges more broadly.

Zukiswa Mqolomba is a senior researcher, senior policy analyst and scholar activist who currently works for the government. Previous work includes work as a consultant for the World Bank in Washington DC. She has two master’s degrees: a master’s from the University of Cape Town and a master’s in poverty and development from the University of Sussex. She is a pan-Africanist in terms of her ideological inclination. She believes in the African renaissance and believes that her generation of peers can make meaningful strides towards achieving it. She writes in her personal capacity.