The COMESA countries are promoting investment to the region, Sherine Nasr reports The Regional Agency of the COMESA, a body that will be in charge of promoting investment in the COMESA region (Common Market for Eastern and Southern Africa) was inaugurated last week. Based in the main premises of the General Authority for Investment and Free Zones (GAFI), the newly established agency will be in charge of promoting investment and business opportunities between member states, as well as facilitating access to information regarding different economic sectors. The inauguration was attended by representatives of investment promotion agencies, bankers and trade insurance companies in Zambia, Malawi, Rwanda and Kenya. The chairman of GAFI and head of the Egyptian Stock Exchange also attended, as well as businessmen who are keen to invest in the COMESA region. "This is but one step in a series of which will be taken to consolidate trade and investment ties between COMESA member states," said Erastus Mwencha, secretary-general of the COMESA. COMESA's strategy for growth is based on identifying the available investment opportunities in principal sectors like industry, agriculture, finance, insurance, infrastructure and tourism. "We are now negotiating our partnership agreement with the EU as a step towards venturing into these markets," said Mwencha. He added that the organisation's secretariat is "working hard" to establish a common investment area among member states by unifying their customs systems, and facilitating investment procedures amongst them. The impending milestone on COMESA's integration agenda will be the establishment of a customs union by December 2008. This will top the agenda of the upcoming COMESA meeting which is due to be held in Djibuti next November. The customs union will include a common external tariff, a common valuation method, and common customs rules and procedures which include documentation and a regionally- harmonised trade policy, in addition to a structure for administering the union. In October 2000, nine member-states started trading on duty-free and quota-free terms, for all goods originating from the region. By January 2004 the COMESA FTA had expanded to include 11, Egypt included, out of the organisation's 19 member countries. Statistics indicate that trade between the COMESA members has grown at an average of 25 per cent over the past four years. In 2005 trade among its FTA members stood at approximately $6.2 billion, compared to $4.3 billion in previous years. Nevertheless, more coordination is still needed as member states import their needs from outside their region. For example, many of the COMESA members satisfy their demand for fertilisers, cement and pharmaceuticals from abroad while they are available in Egypt. In the meantime, Egypt seeks cereals from outside the region. Egyptian construction companies can also play a major role in the COMESA region where infrastructure is badly needed. Foreign Direct Investment (FDI) has not performed as well as expected however. This is despite the fact that noticeable cross-border investments have been made in the services sectors in Uganda, Zambia, Rwanda, Malawi and Zimbabwe. The COMESA was formed in 1993 to promote trade relations and eventually reach complete economic integration among its 19 member states. The population within the COMESA region is 370 million with a GNP estimated at almost $165 million. The COMESA region ranks as the richest in natural resources globally. Some 60 per cent of the COMESA countries' land mass harbours rivers and lakes that can be exploited for water transport, irrigation, farming, power generation and fisheries. The region also houses a sizeable amount of the world's mineral resources including gold, diamonds, platinum, chromium and manganese. The region's substantial untapped energy potential includes some 200 billion tonnes of petroleum, and 170 billion cubic metres of natural gas. Its water resources also have the capacity to generate over 106,000 megawatts. An additional source of energy is 60 billion tonnes of available coal.
