by Munetsi Madakufamba
The Southern African Development Community (SADC) has agreed on strategies geared towards productivity improvement as this has become a must for economic prosperity in a fast changing global market.
The 12·member group noted at its consultative conference held early February in Windhoek, Namibia, that productivity was no longer an optional extra, but a matter that demands priority in formulating national policies.
The conference, which was attended by SADC ministers and officials, representatives of the private sector and International Cooperating Partners, provided a forum for exchange of views, experiences and lessons from around the region and beyond.
The theme, productivity, was most appropriate coming at a time when competitiveness is the buzzword in an increasingly integrated global economy.
In a statement to mark the official opening of the conference, Namibian President, Sam Nujoma, said productivity is critical if the region is to attract foreign direct investment and secure export markets. He noted that the region would only be able to maximise benefits accruing from global trade liberalisation through increased competitiveness.
“It is the level of the region’s productivity that will influence our ability to attract foreign investment and enhance our chance to gain access to important world markets for our products,” he told participants.
Nujoma pointed out that even the survival of individual enterprises depends on how competitive its product is in the market. This therefore called into prominence the issue of productivity.
The conference noted that the prevailing economic reform programmes had facilitated the emergence of small to medium scale enterprises operating especially in the informal sector. In recognition of this, participants urged member states to pay particular attention to the development of this sector as it offered greater prospects for productivity gains.
South African Foreign Minister, Alfred Nzo, who is also chairman of SADC Council of Ministers, said individual countries needed to create a climate of thriving democracy and free enterprise in order to achieve the required levels of productivity necessary to sustain development.
In addition to democracy and free enterprise, the conference identified human resources development, harmonious labour/management relations, science and technology, quality control, infrastructure development, dependable market access, gender equality and equitable distribution of wealth as key factors that impact positively on productivity improvement.
Probably the most exciting moment of the conference was a historic Gender Workshop which preceded the ministers meeting. The council unanimously adopted a set of recommendations that will make women, who form the majority of citizens in the region, an integral part of SADC’s community building initiative.
SADC, which is battling to pool resources to boost declining standards of living of its combined 145 million people, agreed on the urgent need to establish a regional productivity movement. The conference said this will be supported by relevant institutions at both the national and regional levels.
Vedna Mulloo, a private sector representative from Mauritius, stressed that national productivity monitoring mechanisms should hinge on a “pure spirit of a tripartite alliance” comprising the government, private sector and trade unions.
Nzo echoed Mulloo’s views saying: “Business and governments alike have to unconditionally accept the primary responsibility of nurturing a culture of productivity” adding that the international community needed to complement this effort.
As a common strategy, the conference agreed that qualitative and quantitative studies were going to be initiated in all sectors of the economy as a matter of urgency and that information acquired be made accessible to all member states.
The conference noted that the success of these efforts required individual commitment of the political leadership in each country. This was seen as of utmost importance as productivity improvement is often accompanied by significant adjustments both in terms of policy and institutional frameworks which may call for high level decision making.
It was therefore necessary that member states move fast in ratifying protocols so far signed, as these were critical for the successful implementation of SADC’s integration agenda.
SADC executive secretary Kaire Mbuende, who said outstanding progress had been made in preparation of sectoral protocols, expressed dissatisfaction over the pace at which the ratification process was going. He said to date five protocols had been approved in the areas of trade, transport/communications, energy, water and combating illicit drug trafficking.
Foreign Minister Nzo singled out the protocol on trade saying it would be the main engine that drives economic integration in southern Africa. He called on SADC to move rapidly toward the implementation of the protocol in order for nations to start realising the benefits on productivity improvement that will come with it.
Realising the particular importance that SADC attaches to the Trade Protocol, the council directed the Trade and Industry Sector which is coordinated by Tanzania, in conjunction with the SADC Secretariat, to speed up finalisation of outstanding technical work with regard to tariff schedules and modalities for tariff elimination.
The SADC council of ministers expressed satisfaction with the progress on the development of the organisation’s major projects which include the studies on investment profiles in SADC and the establishment of a regional fund or bank. Mbuende said these projects had far reaching implications for the region.
The council however, felt that not adequate time was given to implement resolutions and recommendations made at consultative conferences. As a result, consultative conferences will not be held annually as has been the case in the past, said Mbuende. Instead, such conferences will be held as and when its necessary in future.
SADC’s efforts toward creating a robust economy received a boost from the donor community who, led by the European Union (EU), reaffirmed their support for the region’s initiatives.
Dutch Minister for Development Cooperation, Jan Pronk, who delivered a statement on behalf of EU countries, commended the region for maintaining a stable political environment saying this was crucial as an initial step in luring investment.
He said experience in Europe had shown that economic integration in a politically stable region could lead to a significant growth in intra-regional trade.
Pronk advised that high productivity levels could only be boosted if a dynamic internal market was in place, noting that the region had considerable potential for increasing trade between nations which is currently low compared to other successful trade blocs of the world.
However, Prank was quick to warn: “If you create an internal market in a region marked by great
differences between various countries, this will increase the risks of a widening trade gap and related problems, such as the polarization of investment flows and possible brain-drain, all to the benefit of economically more powerful member states.”
The Dutch Minister was apparently referring to the current trade imbalances between South Africa and its weaker neighbours that has sparked heated debate with the latter calling for a level playing field.
He also assured participants that the current negotiations for a free trade agreement between the EU and South Africa will pay due attention to SADC’s concerns about possible detrimental side effects.
“You can rest assured that the possible side-effects of the free trade agreement are a prominent topic on the agenda of the discussions between the EU and South Africa.” (SARDC)
