Malawi eases trade barriers in COMESA
Ministry of Trade and Industry has expanded the list of goods eligible to be traded under the Common Market for Eastern and Southern Africa (Comesa) Simplified Trade Regime (STR).
The move, which is a response to concerns raised at the Comesa STR Policy Dialogue in Kenya last month, will allow traders to import and export a wide range of goods under the special provision that targets those who regularly transact in low-value consignments.
Ministry of Trade and Industry spokesperson Patrick Botha said in an interview yesterday that expansion of the common list will help to reduce trade costs and widen market access for small-scale businesses.
He said: “We are committed to creating a level playing field for these traders. By expanding the common list, we hope to encourage more entrepreneurs to participate in cross-border trade and contribute to the country’s economic growth.”
The list of goods include agricultural products, live animals, food products, furniture, stationery and other assorted items.
However, delegates to the policy dialogue lamented the exclusion of some products that have originating status and are considered to have been produced, manufactured or processed in a specific country or region.
STR exempts products manufactured with components from a non-Comesa country.
In a separate interview, Malawi Investment and Trade Centre chief executive officer Paul Kwengwere allayed concerns that local cross-border traders will face challenges due to the expanded list.
He said there is a specific list for each border post and that the list is updated periodically to accommodate new developments.
Cross-border Traders Association of Malawi president Steve Yohane said expanding the list is a positive development, but urged authorities to harmonise the multiple lists developed by the government.
“We agreed a common list with Zimbabwe last year, but the government is yet to gazette it. If these lists are gazetted and harmonised, then things will improve,” he said.
Comesa Business Council president James Chimwaza said addressing trade barriers, enhancing digital infrastructure and building capacity can empower entrepreneurs to contribute to the country’s economic development and improve their livelihoods.
Malawi has separate lists for its STRs with Zimbabwe and Zambia.
The STR was established by the 21-member Comesa in 2010 to facilitate trade for small-scale cross-border traders by reducing red tape and streamlining border procedures.
The initiative allows cross-border traders within the bloc to enjoy duty-free status when importing goods originating from other member States.
But a recent review by Trade and Law Centre (Tralac) of Zimbabwe, Zambia and Malawi under Comesa STR shows that Malawi is yet to register significant gains from the STR 14 years after its adoption.
A review shows that there has been no increase in trade volumes, which could suggest increased utilisation of the STR.
This is happening at a time the bulk of traders continue to use traditional informal border crossings while smuggling remains rampant, according to Tralac.
Reads the review in part: “Despite the successes of the Comesa STR as evidenced by the implementation of the STR in the East African Community and recommendations for a similar STR under the African Continental Free Trade Area agreement, more needs to be done.”
Malawi, with a threshold of $3 000 (about K5.2 million), joined the Comesa STR to facilitate informal cross-border trade activities for small-scale traders.
Last year, President Lazarus Chakwera and his Zambian counterpart Hakainde Hichilema launched the Mwami one-stop border post where STR goods are traded
