SPECIAL REPORT
W
ith perhaps the exception of Mauritius, COMESA’s
member states have (due to historical legacies)
posed many bureaucratic and operational
challenges to those wishing to conduct business across
borders within the region. With the plan to implement a
digital free trade area (DFTA) – Africa’s fi rst – COMESA
is hoping to partly address some of these obstacles. Taking
cues from Malaysia’s own Digital Free Trade Zone, the
DFTA will aim to connect sellers and buyers in real time
via blockchain technology (through a series of decentralised
virtual ledgers). In addition to increasing the security of
e-commerce transactions, the DFTA will also generate
certifi cation of origin, creating an extra layer of security and
assurance for e-vendors and buyers.
The planned implementation of the DFTA will, reportedly,
free up an estimated $450mn, which otherwise would
be lost in dealing with the administrative hurdles
associated with cross-border trade (via applications,
documentation and the processing thereof). Of course,
as the barriers to cross-border e-commerce are lowered,
more businesses will have reason to engage in online
vending as a means to reach more potential customers.
This bodes well for local economies and will provide
further impetus to integration efforts throughout the
region.
The DFTA, however, should be regarded primarily
as a resource and an amplifi er – and not as an end in
and of itself. If the 15 COMESA states which have
agreed to the DFTA have neither the will nor the capability to
exploit this resource to its fullest, all of the grand aspirations
of its creators will c ount for naught. If the region improves its
ICT environment, however, the potential for growth will be
enhanced by the DFTA. To this end, businesses and policies
aimed at improving the ICT capabilities of the region are of
critical importance and, as such, require signifi cant investment.
The UN’s International Telecommunications Union
publishes an annual index tracking ICT development in 176
nations. In its 2017 report, the Seychelles and Mauritius were
the only COMESA members to be ranked in the top 100. This
is in stark contrast to the fact that 14 of the 19 COMESA states
are ranked in the bottom 30 percent. Although this appears,
prima facie, as a signifi cant drawback for COMESA, it also
presents the region with a blessing: as ICT remains largely
underdeveloped, the scope for growth and penetration for
investors (in particular) will be substantial and unparalleled.
With the added incentive of the regional DFTA, acquiring
fi nancing for the development of ICT will have an edge over
other countries and regions.
In light of this reality, some COMESA members have
begun to recognise the importance ICT will play in the
future – not only for their respective local economies but
for regional economic development efforts as well. Rwanda,
dubbed the “Silicon Valley of Africa”, is one such country:
various initiatives – such as KLAB (providing ICT facilities
for engineers and entrepreneurs), a Wi-Fi rollout campaign in
urban centres, improved 4G coverage, drone delivery services,
VISA’s choice to launch its mobile payment system in the
country, and many more – all serve to underpin and support
Rwanda’s Vision 2020 program. The program is dedicated
to transforming Rwanda into a knowledge-based economy
by placing emphasis on the improvement and development
of human capital, ICT, and physical and legal infrastructure.
In order to achieve this goal, however, Rwanda has to meet
investors and corporate partners halfway. To its merit, the
country’s government has exceeded expectations. By creating
a ministerial department dedicated to the development and
regulation of matters concerning ICT, national uptake and
development have markedly improved. Foreign investors and
Some COMESA members have
begun to recognise the importance
ICT will play in the future – not only
for their respective local economies
but for regional economic
development efforts as well.
collaborative partners have been granted an ever-increasing
window to doing business in the country.
Other nations in the region have similar practices –
ministries dedicated to ICT are not uncommon (such as in
Uganda, Egypt, and Zimbabwe, among others); transnational
adoption strategies are being spearheaded by the private and
public sector alike; individual nations are partnering with
corporate sponsors to develop ICT throughout schools; and
even Ethiopia, a relatively isolated nation, has sought the
introduction of e-commerce.
Of course, challenges do remain: cybersecurity incidents
may temper enthusiasm for adoption; policy gridlock remains
an ever-present risk (regardless of the polity), and the political
will to carry out the needed programmes may wax and wane
with the transition of governments. Regardless, COMESA has
a long way yet to travel, but the expected momentum it will
gain from ICT development will shine an optimistic light on
the region. As ICT spills over into neighbouring states, and
as governments witness the success stories unfolding around
them, the digital divide will grow increasingly less obstructive
to the economic and social development of the region.
*The author is a Research Assistant at SADC research
Centre
COMESA• 2018 • 33