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President Cyril Ramaphosa’s cabinet approved a draft Single Border Policy (OSBP) for public consultation.
In a post-cabinet briefing on Friday (December 4), the government said the creation of the OSBP seeks to “harmonize the movement of people and goods between South Africa’s land ports of entry and its neighboring countries.”
The policy proposals further seek to address congestion that results in delays, particularly from cross-border travelers and merchants.
“This policy gives effect to the Single Border Framework that was adopted by the Cabinet in 2018. At the continental level, the policy contributes to the Presidential Infrastructure Champion Initiative, which promotes interconnectivity among African countries to address infrastructure deficits and boost within Africa trade, ”the cabinet said.
The draft policy will be posted for public comment during the first quarter of 2021.
The new border policy comes in preparation for the new African Continental Free Trade Area (AfCFTA) that will take effect on January 1, 2021.
The AfCFTA aims to build an integrated market in Africa that will see a group of more than one billion people with a combined GDP of approximately US $ 3.3 trillion.
The United Nations Economic Commission for Africa estimates that the AfCFTA will increase intra-African trade from the current 10% -16% to about 52% by 2022.
Ramaphosa has said that across the trade area, the continent’s leaders are determined to build strong and inclusive economies through industrialization and the benefit of minerals and raw materials.
“The AfCFTA is a significant advance that will change trade patterns and has the potential to transform African economies,” he said in November.
“It will promote economic diversification, the benefit of our minerals and resources and the addition of value to take advantage of the opportunities that arise from an increasingly open African continental market.
“We expect that in the new year, 2021, preferential trade in Africa will start with significant product coverage and expand even more in the coming years,” he said.
Ramaphosa said that even before the AfCFTA agreement, South Africa had already started implementing an investment-based business strategy.
He said that the country has sought to use its foreign direct investment abroad in the rest of the continent to promote balanced growth and localization.
Between 2014 and 2018, South African companies invested more than $ 10 billion, around R160 billion, in different parts of the continent. This has made South Africa the fifth largest source of foreign direct investment on the continent by value, behind the United States, France, the United Kingdom and China.
“The government has been working to prepare South African-based companies for participation in the AfCFTA,” he said.
“We want to ensure that our businesses, entrepreneurs, small businesses and workers benefit from the business opportunities that will arise when the AfCFTA begins operations.”
Read: There are good reasons to limit the amount of money that can leave South Africa: SARB
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