COMESA Agreement

For more information visit:
www.comesa.int
 

The Establishment of COMESA

- The Preferential Trade Area PTA Agreement between the countries of East and South Africa was     signed on December 21st 1981, and entered into force on September 30th 1982.

- As a result of the success of this agreement the signatory countries decided to establish the Common Market for East and South Africa (COMESA). It is considered to be a new step closer to the African Economic Community. 

COMESA Agreement was signed on December 8th 1994, thus replacing the old PTA Agreement.

 Duration

Valid unless the Heads of States and Governments Assembly decides to terminate it upon the recommendation of the Ministerial Council.

Date Egypt joined the Agreement

Egypt became a member in May 1998.

Main Objectives of The Common Market

Objectives of the common market are:

1. To attain sustainable growth and development of member countries by promoting a more balanced production and marketing structure. 

2. To promote joint development in all fields of economic activity, in addition to jointly adopting macroeconomic policies and its programs to improve the welfare of the citizens and encourage close relations between member countries.

3. To co-operate in the creation of suitable environment for domestic, foreign, and cross border investment.

4. To collaborate in strengthening the relations between the common market and the rest of the world.

5. To cooperate in driving peace and security process between member countries so as to strengthen the economic development ties in the region.

Member Countries

COMESA constitute of 20 countries members as follows:
Angola, Burundi, Comoros, Democratic Republic of Congo, Djibouti, Egypt, Eritrea, Ethiopia, Kenya, Madagascar, Malawi, Mauritius, Namibia, Rwanda, Seychelles, Sudan, Swaziland, Uganda, Zambia and Zimbabwe.
 Note that Tanzania has left the COMESA in September 2000

The Organizational Structure of COMESA

The structure of COMESA consists of the following bodies:

• Heads of States and Governments Assembly

• Ministerial Council

• Governmental Committee

• The Committee for the Heads of Central Banks

• COMESA Court of Justice

• Technical Committees

The following organizations are subsidaries to the COMESA:

• Commercial and Development Bank, current headquarters in Kenya

• COMESA Clearing House, current headquarters in Zimbabwe

• Commercial Banks Union, current headquarters in Zimbabwe

• COMESA Institute for Leather, current headquarters in Ethiopia

• Reinsuring COMESA Company, current headquarters in Kenya

Exempted Goods

All commodities of member countries origin (with a minimum local value added of 45% ).

*  For more details please visit the site www.comesa.int 

  Procedures to be               adhered to by member     countries of COMESA

1. To continue applying reduction tariff schedules stipulated by the PTA Agreement on all products traded between member countries as follows:

• 60% as of October 1993

• 70% as of October 1994

• 80% as of October 1996

• 90% as of October 1998

• 100% as of October 2000

2. Lieving all non-tariff barriers on imports from member countries within one year of joining COMESA

3. Establishing a unified custom tariff (customs union) by 2004

  Status of Member Countries in lifting tariff  on imports from other member countries

• Nine countries have achieved a 100% reduction of tariffs on imports from other member countries. These countries are: Mauritius, Madagascar, Zimbabwe, Egypt, Malawi, Sudan**, Kenya, Djibouti and Zambia.

• Burundi has currently achieved a 60% reduction on tariffs and will further reach 80% reduction on January 1st 2003 and 100% reduction on January 1st 2004.

• Comoros Islands has currently achieved an 80% reduction on tariffs with an expected further reductions to reach 100%.

• Democratic Congo approved in its 12th cabinet meeting a tariffs reduction of 70%, but it requested to conduct a research to assess the impact of losing customs income on the national budget. It has not yet implemented the 70% reduction.

• Ethiopia currently applies a 10% reduction on tariffs and it is studying the effect of further reductions on the national economy.

• Eritrea currently applies an 80% reduction on tariffs and has not yet declared further reductions.

• Namibia and Swaziland are currently consulting the South African Customs Union (SACU) to comply with their obligations of tariff reduction. 

• Rwanda applies 80% tariff reduction since 2001 and will achieve the agreed upon reduct percentage in 2004.

• Seychelles undertook to apply a 100% tariff reduction as of June 1st 2001, but has not yet implemented this reduction.

• Uganda currently applies 80% tariff reduction and in is studying the effect of further reductions to reach 100%.

  Subsidies provided by member countries

- Opposition of any subsidies that distorts or threatens to distort competition in the form of preferential treatment to the producers to encourage the production of a particular commodity or taking certain steps that would effect inter-trade between member countries.

- Any member country is entitled to apply a compensation fee on an imported product from another member country to counter act direct or indirect subsidy amount imposed on exports or production of similar product in country of origin according to the regulations set by the Council.

- Any member country is entitled to apply a compensation fee on a product from a third country that was imported by another member country according to the system set by the Council.

  Impact of COMESA  Agreement

Tariff were fully lieved as of 31/10/2000 with the exception of a number of countries with varying degrees of implementation on a case by case basis as displayed. Member countries will establish a custom union by 2004, and a monetary union by 2025.

Transit transport  facilitation regulation and easier movement of goods within the region have resulted in a reduction of costs by 25%.

** Currently Sudan is  not applying  100% tariff reduction with Egypt