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    Creation of African Free Trade Area to Play New Role in Integration and Trade Growth - ECA Director

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    Director of the Economic Commission for Africa office for North Africa, Lilia Hachem Naas, is one of the attendees of the MEDays 2019 forum, set to take place on 13 November in Tangier, Morocco.

    The 12th edition of the MEDays 2019 forum kicks off next Wednesday. The four-day gathering will welcome over 2,500 attendees, including over 150 high-profile international speakers and more than 80 government representatives.

    The event, under the patronage of the country's monarch Mohammed VI, is organised by the Amadeus Institute, a think tank focusing on research and analysis on strategic issues concerning Morocco, North Africa, the Middle East, the Mediterranean region, Africa, and the South.

    The forum will touch upon issues of geostrategic, political, economic and social importance in the countries of the Mediterranean, African, and Arab regions, such as African integration, migration, terrorism, cybersecurity, the Palestinian deal, post-Brexit ties with the UK, and other topics.

    The first day of the forum will commence with an "Economic Intelligence" module, followed by a workshop titled "African Union’s Governance: Towards Modernisation and more Transparency", which will be moderated by Sputnik France's correspondent in Tunisia, Grira Safwene.

    Lilia Hachem Naas shared her vision for economic opportunities in Africa as well as the possibilities of African integration.

    Sputnik: The main objective of the Economic Commission for Africa Office is to contribute to achieving structural transformation and balanced development via the implementation of an environment conducive to creating employment opportunities for women and young people in North Africa. What measures is your organisation taking in creating employment opportunities for women and young people in North Africa?

    Lilia Hachem Naas: Thank you for the question. We are a think tank institution, which means that we conduct some research and analyses to understand the sources of the problem, as well as the solutions that can be proposed or implemented by the member states. In this area, we have just started to work on employment in 2018-2019; we have focused on that area. We are trying to look at it from an economic perspective to see what the gaps and the missing links across different policies are, that would help promote a new private-sector dynamic, a new openness […] sector productivity and in that way create a positive circle where there would be better competitiveness and better products and services can be exported to different parts of the world; [it would also help] create more jobs, more companies and new positive dynamics in terms of economic development. So, this is what we are trying to bring to the table and [we are trying] to show that with better alignment and support for a dynamic private sector, we can actually help companies create more jobs.

    Sputnik: What exact steps do you face to provide opportunities for women and young people in North Africa?

    Lilia Hachem Naas: For now, we have organised a regional dialogue, where we have brought to the table representatives of the public and the private sector to speak about what the gaps and missing links are, what the difficulties that our countries are encountering in creating employment are, and what some of the solutions that were put in place in some member states are. For example, Morocco has implemented this ecosystem approach where they put all the services and the support needed by companies in a specific sector close by so that they have everything they need to expand and grow. This is one solution. There are other solutions in other countries. And we are trying to look at what we call "best practices", basically, and we are analysing the factors that make these practices successful and how other countries can implement them. This is our work; it is not so much in terms of creating this employment, but creating the environment that is necessary and that is more conducive or more favourable for employment creation.

    Sputnik: What difficulties do you face?

    Lilia Hachem Naas: We do face some difficulties, particularly when we talk about policies and adjustment of policies. It takes time, there are specific steps that you need to go through in terms of reviewing and adjusting the policies, which are steps we don’t have influence over; it has to go through the due process that is applicable in any country. This is one of the difficulties. We need to bring that change quickly, and it may be a little bit of a challenge. It takes a little bit of time, but, I think you know, if we follow the steps properly, the change is more sustainable and longer.

    Sputnik: What kind of measures does the Economic Commission for Africa expect from the government(s) regarding this problem?

    Lilia Hachem Naas: We actually provide advisory services to the governments. We advise on what the best approach is, or what the best way to go is. But we cannot really impose specific measures or impose specific action to be taken; it has to fit within the plan and priorities of each government of each member state. What we would like to see the governments do is to really consider the research that we are doing and the recommendations that we come up with to see how this can be translated into forming some of the policies. For instance, we are providing a lot of advice on digitalisation. And obviously, if you use more effectively new technologies, it can create a more transparent and open environment; it will produce better productivity and better competitiveness for the private sector. These are the things we advocate for, and we try to show through social analysis what the benefits are, and we hope that the governments actually take it on and implement it.

    Sputnik: Some experts have been saying that unlike many groups in other regions of the world, the work of African integration groups (with some exceptions) has not been contributing to the growth of mutual trade. How do you rate the contribution of African integration groups?

    Lilia Hachem Naas: We actually know that integration within Africa is not very high; overall on the continent it’s about 16 percent. Intra-African trade represents about 16-17 percent of overall trade, so it’s not very high compared to other regional groups. There are many reasons for this. One of them is, of course, the lack of infrastructure; I’m talking about roads, railways and connections across countries, which, of course, increases the cost of any transaction when you think of it. There is also a lack of logistics and transportation. These are some of the aspects that hinder the development of trade. Another aspect which is important is that Africa is trading mainly raw materials and commodities, which are not transformed. It has not been able to diversify to a large extent its exports, and that’s why it is also more difficult to position itself in the global market.

    Sputnik: What are the main factors hindering integration in Africa in 2019? Could you highlight areas that need to be improved?

    Lilia Hachem Naas: Some of the factors that are hindering integration in Africa are the lack of infrastructure – maybe not the lack of it, but limited infrastructure that links all African countries all across. There has been a lot of effort recently to develop the infrastructure; there has been a lot of investment; a lot of trade corridors have been created. And we really think that this will prompt a quick development in terms of trade across the country. But for now, it’s not at the optimal level. It is developing, but it’s not at the optimal level. That’s one side. Secondly, sometimes there’s also lack of harmonisation in terms of regulations, standards and things like that would apply for trade exchange; and this is what we are looking at with the implementation of the Continental Free Trade Area, for countries to be harmonised, standardised and be able to facilitate trade exchange across Africa. As I said earlier, there’re also all the logistic and transportation services, which are not very well developed across the African countries. From the historical perspective, trade flows from Africa have been happening more than within the continent itself, and this is the new dynamic that has been created. It is more developed in some regions, but they are still very low compared to Europe or Asia. The maximum reach within any sub-region of Africa is about 16-17 percent of regional trade, this is very low; and this is a new perspective, especially with the Continental Free Trade Area, that we are bringing in and encouraging to show that there is great potential within Africa. These are growing economies, there’s a growing middle class, and there’s a growing demand for value-added products. So, we think that this is a great opportunity to actually develop manufacturing industries and transformation of raw materials that can be exported and imported within the continent.

    Sputnik: On 21 March 2018, agreements on the creation of the African Continental Free Trade Area (AfCFTA) were signed. Will this agreement play a fundamental new role in the fate of Africa regarding the growth of mutual trade? What contribution has been made this year?

    Lilia Hachem Naas: As I just said, we are convinced that it will play a fundamentally new role for African integration and within intra-African trade development and growth. The agreement has gone through the first stage of negotiations, which has put in place some of the fundamental foundations for the agreement to work. There is still a lot of work to be done; we are moving to the second stage of negotiations. And it will bring a change within the continent in terms of, as I said, harmonisation of rules and standards to apply the same rules across the continent or across different sub-regions in terms of trade and to encourage the opening of the border to encourage cross-border trade and improving trade facilitation measures within all countries. We are looking at reducing, I mean the [tariffs] are relatively low, there’re non-tariff areas of trade within the continent, and to harmonise rules and regulations for that it is in favour of internal trade within the continent.

    Sputnik: Which integration associations in Africa do you think are the most effective in combating them?

    Lilia Hachem Naas: The two groups that are most effective, to my knowledge, on the continent are the East African Community and the West African Community. They have actually advanced; they have taken […] integration creating a union with one external tariff and with free movement of goods and people within the region. These are the most advanced groups, and these are examples that we can learn from and get inspiration from to encourage other regional groupings to follow the same model and to also implement it within the Continental Free Trade Area.

    The views and opinions expressed in the article do not necessarily reflect those of Sputnik.

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