The Ethiopian Ministry of Trade and Regional Integration of late organized the national trade exhibition under the theme, “Buy Ethiopian Products,” aiming at raising awareness on trade and regional issues thereby fostering connections between consumers and wholesalers.
The exhibition has brought participants from a wide range of stakeholders, including importers, exporters, local producers, cooperatives, and other business sector actors. Besides, the Ministry has been hosting the National Trade Exhibition and it announced a Permanent Export Trade Exhibition Center is inaugurated inside its premises.
Taking about the center, Trade and Regional Integration Minister, Kassahun GofePhD, stated that the ministry has inaugurated the center along with the launch of the annual trade fair week. The Minister added that the permanent export trade exhibition center, rest on 730 square meters, designed to display all types of export products of the country.
He said, “Trade and regional integration tendency has led to major developments in continental and international relations between/among many countries specifically via booming international trade and investment and in the formation of regional trading alliance. Regional integration can be promoted through common physical and institutional infrastructure.”
He said that, a key highlight of the exhibition has been the availability of various products at affordable prices, offering attendees the opportunity to access quality goods. In addition, panel discussions on domestic and export trade, and even about product quality, has been held with a view to providing valuable insights for both participants and visitors. Responsible institutions will use the platform to promote their products and services.”
Kassahun further elucidated that, the Ministry anticipates a strong turnout, with many citizens expected to visit the exhibition. The event is part of a broader effort to enhance trade relations and stimulate economic activity across the country.
As to him, the objective of the center is to promote Ethiopia’s export products to the international market. The one week long trade fair has aimed at encouraging exports and substitute import goods with domestic products.
He said, “The trade fair will create a favorable environment to showcase the potential of Ethiopia in export and domestic products. The suppliers will exhibit quality product at the trade fair and buyers can buy products with affordable market price. In parallel with the trade fair, panel discussions among stakeholders as well as recognition and award ceremony to members of the business community with outstanding performance took place.”
It is well recognized that there are four main types of regional economic integration. In the first place, free trade area. This is the most basic form of economic cooperation. Member countries remove all barriers to trade between/among themselves but are free to independently determine trade policies with nonmember nations.
Secondly, customs union should be taken into account. This type provides for economic cooperation as in a free-trade zone. Barriers to trade are removed between member countries. The primary difference from the free trade area is that members agree to treat trade with nonmember countries in a similar manner.
Thirdly, the notion of common market is quite important. This type allows for the creation of economically integrated markets between member countries. Trade barriers are removed, as are any restrictions on the movement of labor and capital between member countries. Like customs unions, there is a common trade policy for trade with nonmember nations. Last but not least, the case of economic union. This type is created when countries enter into an economic agreement to remove barriers to trade and adopt common economic policies.
The Ethiopian economy has undergone dramatic changes and the nation has become integrated into the regional, continental and even global marketplaces. Once highly reserved itself from being intertwined into wider market scopes, Ethiopia is now open for foreign trade and business via entertaining regional trade integration. The government of Ethiopia needs to institute far-reaching economic reforms, which have had a major impact on the way business is conducted and the scale of business has changed as well. True, competitiveness and efficiency have become higher priorities, although many investors, companies, organizations and the like are with limited capacities to foster trade so. This trend in turn needs to be well transformed to help them build capacity to run wider trade.
Ethiopia has always been working to have a strong trade relation and business culture, and the long-term relationships are still the foundation on which trust is established and business is well built.
“A trade bloc is basically a free-trade zone, or near-free-trade zone, formed by one or more tax, tariff, and trade agreements between two or more countries. Some trading blocs have resulted in agreements that have been more substantive than others in creating economic cooperation. Of course, there are pros and cons for creating regional agreements,” Kassahun stated.
The merits of creating regional integration in trade on which the ministry has been focusing include trade creation, such a positive move generates more opportunities for the nations to trade with one another by removing the barriers to trade and investment; employment opportunities, consensus and cooperation, and regional understanding and similarities may also facilitate closer political cooperation.
Specifically, regional integration requires cooperation between countries like trade, investment and domestic regulation, transport, ICT and energy infrastructure, macroeconomic and financial policy as well as the provision of other common public goods like shared natural resources, security, education.
Here lies the importance of strengthening the multilateral trade system to allow the region to capitalize on its production and trade potential. In so doing, countries including Ethiopia must make better use of opportunities afforded by the signing of trade accords and by integration processes such as trade policy, administration of agreements and trade promotion, to spur economic recovery and increased food security.
“In the current climate, there is a clear need to link the issues of trade and the environment. The region can capitalize on its wealth of natural resources and the efficiency of its production systems to increase its presence in international markets and to deepen integration processes to contribute to the supply of healthy, nutritious and safe food, produced in an environmentally responsible manner,” he added.
The trade and regional integration initiative continues to provide support to member countries to improve their access to international markets, deepen their regional integration and increase their contribution to real socio-economic transformation. To this end, trade and regional integration needs to focus on two strategic lines of action: improving market access and implementing trade policies to promote openness, transparency and the free flow of international trade, and identifying and capitalizing on opportunities afforded by trade agreements and integration processes.
Kassahun further said that, taking changes in trade flows and intraregional into account, the aim of the center is to develop differentiated strategies, specific to markets, chains or products, and to strengthen the export capacities of companies and producer organizations. The center will also create forums to facilitate trade, through the use of new technologies, such as virtual business roundtables, e-commerce platforms, trade fairs and face-to-face trade missions. Plus to that it would promote linkages at the regional and global levels, as a means of improving access to export markets and contributing to food security and economic and social recovery, in response to markets shocks.
Sluggish pace of trade and regional integration is of course the result of weak infrastructure, productivity and trade facilitation, acute export supply constraint that characterizes the African export trade. This calls for an innovative approach to enhance intra-Africa trade and furthering regional integration.
Natural resources management, particularly coupled with the ever-growing industry, can make a meaningful contribution to a country’s economic growth, and hence, it leads to linkages to the broader economy.
In a continent facing massive infrastructure needs, African countries can thus miss out on opportunities to promote the shared use of infrastructure and to strengthen the linkages between extractive resources and the broader economy.
In a nutshell, regional integration is often seen as less relevant for resource-rich countries, since demand for commodities typically comes from the global market rather than from regional demand. Regional integration in Africa, however, can play a vital role in diversifying economies away from dependence on the export of just a few mineral products; in delivering food and energy security; in generating jobs for the increasing number of young people; and in alleviating poverty and delivering shared prosperity.
True, deepening regional integration among African economies would be of paramount importance in providing all nations with both opportunities and challenges to the sound management of extractive resources and translating wealth from these resources in to diversified economies and equitable growth.
BY MENGESHA AMARE
THE ETHIOPIAN HERALD THURSDAY 29 AUGUST 2024
