COMESA TRANSPORT SERVICES EXPERIENCE: POLICY AND STRATEGY

Presentation by

Emily Mburu

Trade in Services and Trade Facilitation Coordinator

COMESA Secretariat

CONTEXT Introduction COMESA Trade in Services (TIS) Programme COMESA Negotiations on Trade in Services COMESA work on Transport Services Trade and Transit Facilitation Transport sub-sectors

Air Transport Road Transport Rail Transport Maritime Inland Water Transport

Conclusion

INTRODUCTION

At the initial stages the COMESA liberalization process concentrated on goods;

Transport and financial services were the early sectors for regional cooperation to facilitate the movement of goods

In the late 1990s COMESA included Trade in services as part of the integration programme and formed a working group on Trade in services

TRADE IN SERVICES IN COMESA Trade in services in COMESA rose from $24.2

billion in 1997 to US$51.4 billion in 2007 Services contribute at least 40% of GDP in most

COMESA Member States The objectives of the trade in services

programme are:Eliminating barriers to trade in services to

promote growth and developmentEnhance cooperation among Member

States to improve the efficiency and competitiveness of the markets

To increase, improve and develop the exports of services

Liberalize trade in services

FORUM FOR NEGOTIATING TRADE IN SERVICES

The Framework for liberalizing trade in services in COMESA was developed and adopted by Council in June 2009 The Regulations on Trade in services Annex on the temporary movement of persons

The Regulations on Trade in Services provided for the formation of the Committee on Trade in Services

COMMITTEE ON TRADE IN SERVICES The first meeting of the Committee was held

in September 2009 Services negotiating guidelines developed They provide for seven (7) priority sectors,

namely business, communication, construction, energy, financial, tourism and tourism

At the second meeting in May 2010 Member States agreed to commence

negotiations in four priority sectors, namely communication, financial, tourism and transport

The other three sectors are to be included once schedules of commitments are done in the four priority sectors

COMMITTEE ON TRADE IN SERVICES

Held in September 2009

Services negotiating guidelines developed

Provides for seven (7) priority sectors, namely business, communication, construction, energy, financial, tourism and tourism

Held in May 2010 MS agreed to

commence negotiations in four priority sectors, namely communication, financial, tourism and transport

The other three sectors are to be included at a later stage

First Meeting Second Meeting

COMMITTEE ON TRADE IN SERVICES (CONT)

Held in May 2011 Member States

initiated the process of exchange of information based on their draft schedules of commitments

Member States agreed to finalize their schedules of commitments

Held in July 2012 10 Member States

have submitted their schedules of specific commitments in the four priority sectors

MS with submissions discussed the schedules and made requests to each other

Third Meeting Fourth Meeting

WORK UNDER THE TIS PROGRAMME To deal with specificities of each sector/sub-

sector, the TIS programme works in collaboration with other COMESA programmes that deal with specific services’ sectors, such as Insurance (Yellow card) ICT Transport etc

The objectives are to: Bring together relevant stakeholders in a specific

sector to identify the issues of interest to them in the sector

Enhance cross border trade and investment by eliminating barriers to trade in the specific sector

Work on harmonization of laws and regulations in the specific sector

COMESA WORK PROGRAMME ON TRANSPORT An efficient transport sector is an integral

element for development and facilitation of trade

COMESA has developed two documents A Regional Transport Policy A Regional Transport Strategy

The documents were adopted by Ministers of Infrastructure in July 2011

These are to be used by MS in formulating national policies and strategies from a regional trade development and integration perspective

The strategy mentions the need for regional transport operators forming alliances to obtain economies of scale

TRADE AND TRANSIT TRANSPORT FACILITATION

COMESA has developed a number of instruments to facilitate trade and transport and reduce the cost of doing business

Among the issues addressed are lack of harmonization in policy, regulations, administrative and procedural regimes

The sub-sectors taken into consideration are: Air transport Road transport Rail transport Maritime transport Inland water transport

AIR TRANSPORT The liberalization program is based on the

Yamoussoukro Decision (YD) adopted by the AU in 1999 and ratified in 2000

Implementation is through Legal Notice No. 2 which are the Regulations for the Liberalization of Air Transport in the COMESA region

16 MS are implementing Phase 1 of Legal Notice No.2, the exceptions are: Libya, Madagascar and Swaziland

11 MS are granting the fifth freedom rights to COMESA air carriers, namely Burundi, Djibouti, Egypt, Ethiopia, Kenya, Malawi, Rwanda, Sudan, Uganda, Zambia and Zimbabwe.

AIR TRANSPORT (CONT)

COMESA-EAC-SADC JOINT COMPETITION AUTHORITY (JCA)

Joint Competition Regulations and the Guidelines, Rules and Procedure for implementation of competition in air transport adopted by the 3 RECs

Established to supervise the activities of the airlines and operators in a liberalized market

The JCA comprises of seven members two from each REC and a rotating Chairperson for the RECs

Presently the members are: Burundi and Uganda (EAC), South Africa and Zimbabwe (SADC), and Malawi and Sudan (COMESA). Kenya is Chairing on behalf of COMESA

SADC Secretariat is providing secretariat services

Mandate Membership

ROAD TRANSPORT Road transport is the primary mode of transport for

goods and passengers in the COMESA region Road Sector Management and Funding Reforms

have been undertaken by MS to manage and maintain the road infrastructure assets

Most MS have set up road funds and development agencies

These agencies are responsible for construction and maintenance of road infrastructure nationally

The main source of funds are fuel levy for maintenance

Construction and rehabilitation is through government budget allocations, borrowing from development banks and cooperating partners

RAIL TRANSPORT The share of cargo by rail has declined

drastically in the COMESA region in the past three decades

Options adopted to improve performance of the sector include: concessions of railways restructuring of management closure of branch lines in some countries

Concessions have been done in 4 countries namely, Ethiopia, Kenya, Malawi and Uganda

Though no significant improvements in overall efficiency of the sub-sector

New railway development projects are underway in the region

MARITIME TRANSPORT Main challenge in the region is port

congestion Measures adopted to reduce congestion in

the port of Mombasa include Kenya Ports Authority and the Kenya Revenue

Authority designated private local container terminals to accept cargo discharged directly from ships prior to payments of charges and customs dues

Regulatory checks and payments are now done at the private container terminals

Privatization of some services at the port is creating room for private sector participation and increasing investments at the ports

INLAND WATER TRANSPORT

Not much so far has been done in this subsector in the COMESA region

MS have agreed to prioritize the preparation of standards and regulations to enhance safety of navigation

MS sharing common water bodies are to enter into multilateral agreements to develop harmonized management of the resources

CONCLUSION

Develop national and regional strategies for dealing effectively with transport services as they are vital for economic development

Expand trade and investment opportunities and cooperative arrangements, especially under the Tripartite for economies of scale as well as to diversify markets and take advantage of trading opportunities

For COMESA, most work now under the infrastructural development is being undertaken at the Tripartite level

THANK YOU FOR YOUR ATTENTION