Intra-SADC FTA trade and SADC FTA trade with the rest of Africa 2019

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Intra-SADC FTA trade and SADC FTA trade with the rest of Africa 2019

Intra-SADC FTA trade and SADC FTA trade with the rest of Africa 2019

The Southern African Development Community (SADC) consists of 16 members – 13 of which are in a free trade area (FTA). The SADC FTA members are Botswana, Eswatini, Lesotho, Madagascar, Malawi, Mauritius, Mozambique, Namibia, Seychelles, South Africa, Tanzania, Zambia and Zimbabwe. The Democratic Republic of Congo and Comoros are yet to join the SADC FTA while Angola has recently submitted an offer to accede to the FTA.

This blog analyses intra-SADC FTA trade as well as trade between the SADC FTA States and the rest of Africa for 2019. Of the SADC FTA countries Tanzania is the only country which has not yet reported its 2019 data necessitating the use of mirror data.

Intra-SADC trade

In 2019, intra-SADC FTA trade was 23 per cent of its total world trade, and 81% of its Africa trade. Intra-SADC FTA exports amounted to US$29.8 billion (5% decrease from 2018). Main products (at HS2 level) traded intra-SADC FTA were light oils, electrical energy, diamonds, tobacco, chromium ores, nickel ores, food and beverage industry additives, gold, goods vehicles, iron ores, ferro-chromium, chemical products and preparations, medicaments, maize, refined sugar and copper ores.

In terms of total trade (imports + exports), South Africa was the biggest intra-SADC FTA trading partner (accounting for 45% of total intra-SADC FTA trade). Namibia was second (10%), followed by Botswana and Mozambique (9% each), Zimbabwe (8%), Zambia (6%) and Eswatini (5%). Seychelles’ intra-SADC FTA trade is very low at 0.1 per cent.

South Africa was the largest intra-SADC FTA exporter – accounting for 66 per cent of intra-SADC FTA exports. The products exported by South Africa to other SADC FTA countries included light oils, electrical energy, chromium ores, and iron ores. Zimbabwe accounted for 9 per cent of intra-SADC FTA exports, Namibia 7 per cent, Eswatini 5 per cent and Mozambique 4 per cent. Botswana and Zambia exported 2 per cent each; Mauritius, Tanzania, Lesotho and Malawi exported 1 per cent each and the respective percentage of intra-SADC exports by Madagascar and Seychelles were 0.5 per cent and 0.1 per cent.

South Africa also accounts for the largest portion of intra-SADC FTA imports – 23 per cent of intra-SADC FTA imports. The main imports by South Africa were food and beverage industry additives, gold, natural gas and electrical energy and diamonds. The products were imported duty-free into South Africa.

Botswana imported 15 per cent of intra-SADC FTA imports, Mozambique 14 per cent, Namibia 13 per cent, Zambia 9 per cent, Zimbabwe 8 per cent and Eswatini and Lesotho 5 per cent each. Tanzania, Malawi and Mauritius each accounted for 2 per cent of intra-SADC FTA imports and Madagascar and Seychelles 1 per cent and 0.3 per cent, respectively.

Between 2018 and 2019, intra-SADC FTA exports decreased by 5 per cent. Except for Zimbabwe, Eswatini and Seychelles, all the SADC FTA member states’ exports to the region decreased between 2018 and 2019. Intra-SADC imports for all countries decreased except for Mozambique and Mauritius (see Table 1).

Table 1: SADC FTA members’ percentage changes in intra-SADC FTA exports and imports between 2018 and 2019

Country
Exports
 
Imports
South Africa
-2%
 
-13%
 
Botswana
-16%
 
-1%
 
Mozambique
-6%
 
11%
 
Namibia
-3%
 
-1%
 
Zambia
-24%
 
-7%
 
Zimbabwe
1%
 
-15%
 
Eswatini
6%
 
-2%
 
Lesotho
-19%
 
-2%
 
Tanzania
-62%
 
-0,4%
 
Malawi
-20%
 
-3%
 
Mauritius
-4%
 
1%
 

Madagascar

-23%

 

-4%

 

Source: ITC TradeMap (2020) and tralac calculations

The decrease of Madagascar’s exports to SADC FTA between 2018 and 2019 was caused by the massive declines in exports of cobalt (-64%), vanilla (-54%) and ammonium sulphate (-24%). Zambia’s exports declines because of massive decreases in exports of copper (-94%), tobacco (-72%) and oil cake (-62%).

Eswatini’s exports to SADC FTA increased as a result of significant increases in the exports of sucralose (7 627%), trailers of caravans (7 100%) and pliers (6 900%), and frozen beef (6 700%).

Zimbabwe’s imports from SADC FTA declined between 2018 and 2019 due to lowers imports of oilcake (-58%), vehicle goods (-30%), animal feeding preparations (-24%). South Africa experienced substantial decreases in the imports of gold plated with platinum (-67%), live cattle (-36%) and gold plated with platinum in semi-manufactured forms (-22%).

Mozambique’s imports from SADC FTA increased as a result a significant increase in imports of non-agglomerated iron ores (181%) between 2018 and 2019.

SADC FTA trade with the rest of Africa

In 2019, SADC FTA exports to and imports from the rest of Africa were valued at US$6.9 billion and US$6.5 billion, respectively. Exports accounted for 5 per cent of world trade, and imports for 4 per cent of world trade. The African countries mainly traded with are Nigeria, DRC, Kenya, Angola and Ghana.

The main products exported by the SADC FTA countries to other African countries were raw sugar cane, goods vehicles, sulphuric acid, bituminous coal, food and beverage industry additives, polypropylene, flat-rolled iron/steel products, light oils, portland cement as well as chemical products and preparations. 31 per cent of the SADC FTA exports to Africa went to DRC, 12 per cent to Kenya, 8 per cent to Nigeria and 7 per cent to Angola. Kenya imported mainly (HS2) iron and steel, sugars and sugar confectionery, mineral fuels, and cosmetics. Nigeria imported mainly glass and glassware, plastics and vehicle parts. Angola imported general and electrical machinery, vehicle parts, beverages, spirits and vinegar.

Top products sourced by SADC FTA countries from other African countries include crude petroleum oil, copper, frozen sardines, cobalt oxides, light oils, wheat flour, medicaments, cigarettes, medium oils, and soap and organic surface-active products. Nigeria is the major supplying market, exporting 54 per cent of SADC FTA imports from the rest of Africa. Ghana exported 10 per cent, Angola 9 per cent, Kenya 8 per cent and DRC 6 per cent.

Top products (HS2) supplied by Nigeria to SADC FTA were mineral fuels, ship structures and fertilisers. Ghana supplied mainly precious stones, mineral fuels and cocoa. Angola supplied mineral fuels, precious stones and general machinery. Kenya supplied mainly general machinery, soap and pharmaceutical products.

About the Author(s)

Martin Gitau (intern)

Martin Gitau (intern)

Martin Gitau holds a Bachelor of Laws (Hons) from Catholic University of Eastern Africa. He recently graduated with an LLM in International Trade Law from the University of Stellenbosch, South Africa. His interests include legal aspects of world and regional trade, sustainable development law, international tax law, carriage of goods by sea and international sales law. His research interests revolve around international and intra-regional trade, regional integration, specifically the United Nations Convention on Contracts for the International Sale of Goods (CISG), its non-ratification as a non-tariff barrier to trade in Africa.

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