By: Anthony Sedzro
The Chief Strategist at the Afrochampions Initiative, Michael Kottoh, has advised governments to remove customs barriers littered on the West African road corridor to dramatically boost intra-African trade. Customs barriers, no matter the reasons for their citing, are untenable in the face of modern technological advancements. Deployment of technology can help to overcome revenue and security concerns of these customs barriers, Kottoh said.
He was speaking at the 5th Crystal Ball Africa conference organised by the pan-African business law firm AB & David, headquartered in Accra, Ghana. The conference was on the theme “Expanding Businesses and Trade across Africa – Opportunities Arising Out of the Continental Free Trade Agreement (CFTA) and Growing Intra-Africa Trade”, held at the Labadi Beach Hotel Accra on 10th January, 2018.
Kottoh who gave an address on the topic “From local champions to Afrochampions: The case of expanding beyond Africa and beyond”, also spoke to GB&F magazine saying borders are antiquated and must be removed.
“Borders in principle are actually antiquated. The big question is why are the borders there? Is it because of security reasons or because of taxes? Those are the two thinks you could think about,” Kottoh said.
He offered solutions: “There are far smarter ways of doing these things. Through digital technology you can track goods and services right from the point of transportation to the point of destination. So you don’t actually need to physically check every good that has to go through the border.”
“So all you need is for these countries to have [trade] protocols in place where they have a shared database that makes sure that if a product is moving from Ghana to Nigeria, there is a shared database and there is a tracker that is tracking the goods that are going across the border,” Kottoh, suggested.
He continued: “So, at the end of the day, Benin knows how much it is charging, Nigeria knows how much it is taking and whatever tariffs they want to take and so on. And it (the goods in transit) is taxed at one point and it is transmitted to all the other countries and you share it and everybody gets their share.”
The conference theme is on the backdrop of African Union’s plan for Africa to have a Continental Free Trade Area (CFTA) this year. It is estimated that this will remove the borders in the more than 50 countries and boost intra-African trade by 52 percent by 2020. According to Kottoh, this is long overdue because one reason for citing of borders is the issue of security but, this is unfounded.
“Quite frankly, I think that the fears around the security issues are unfounded. If you going to have criminals coming across a country’s borders they don’t come through the official borders, they use the unapproved routes to enter the country,” he reasoned.
…Can CFTA work without reliable transport links? asks Oteng-Gyasi
Meanwhile, the Chief Executive Officer of Tropical Cable and Conductor Limited, a leading Ghanaian steel manufacturer, has questioned whether the CFTA can work well without the continent having an efficient transport link.
Oteng-Gyasi, who was the Chairman for the Crystal Ball Africa 2018, was giving his Chairman’s remarks at the event.
He praised the initiation of the CFTA which will be launched by the AU in March this year. However, he said the 55 countries in Africa and their trade restrictions is a constraint to industrialisation because it has divided the continent into blocs with their own difficulties.
“Can Africa bypass efficient transport links?” the CEO of Tropical Cable asked. “Is it possible to create a CFTA without a reliable transport link?” he queried rhetorically. As someone whose company exports steel products to other African countries, he knows so well the challenges of moving goods from one African country to another hence the queries on the efficient transport links on the continent. AU needs to address that for a successful continental free trade, he advised.