Businesses within the Common Market for Eastern and
Southern Africa (Comesa) could save up to $450 million in clearance
documentation once the bloc adopts blockchain technology for clearing imports.
Comesa is looking to roll out a digital free trade
area – the first in Africa – modelled along the Malaysian Free Trade Zone,
where parties to a transaction are connected in real time through a web of
ledgers that are secure.
The application also supports generation of an
electronic certificate of origin whose authenticity can be verified using
national information technology systems.
This will be a marked break from the current practice
which involves manual applications and physical presentation of documents to
tax bodies and other government agencies that cause businesses delays.
Trade financiers could be the biggest losers once the
system is in place.
“We are rolling out the Digital FTA in 2018,
beginning with willing member states on the basis of the principle of variable
geometry,” said Comesa spokesman Mwangi Gakunga
Last month, Comesa completed the design and action
plan of the Digital Free Trade Area, the Electronic Certificate of Origin
(e-CO) and their draft regulations.
Ending border queues
Piloting of the digital FTA is expected to start in 15
of its 19 member states, enabling large and small enterprises alike to trade
using their smartphones and tablets.
“The e-certificate of origin is a good practice
around the world but Comesa will be the first regional economic bloc in Africa
to have it as a regional FTA instrument,” he added.
According to Comesa Secretary-General Sindiso Ngwenya,
the digital economic integration will do away with long queues at border posts
for goods and people moving across borders
“We have developed a mobile application for
cross-border traders which shall be launched in the countries that are involved
in the simplified trade regime. We shall integrate them to Customs and other
agencies and also to the Comesa centre,” he said.
The participating countries are Kenya, Uganda, Rwanda,
Burundi, Democratic Republic of Congo, Sudan, Ethiopia, Egypt, Seychelles,
Malawi, Mauritius, Madagascar, Swaziland, Zambia and Zimbabwe, which are all
part of Comesa’s Simplified Trade Regime that allows traders with goods valued
at $1,000 or less to access cross-border markets duty free.
To be Contd………