Enhanced trade expected between Seychelles and the Southern African Region Community (SADC) member states as Seychelles joins the SADC Free Trade Area
Seychelles becomes an official member of the Southern African Development Community Free Trade Area (SADC FTA). This accession formally provides a pathway for enhanced trade between Seychelles and the Southern African region. This is another milestone in the Government’s effort to identify and adopt strategies that will improve the business and private sector environment.
Seychelles’ accession efforts towards the SADC FTA dates back to December 2010 when the Government found it would be beneficial to intensify efforts to join the SADC FTA. Seychelles submitted its accession to SADC FTA in May 2014 and earlier this year on the 25th May 2015, the Customs Management (Southern African Development Community Free Trade Area) Regulations, 2015, were enacted into Seychelles' laws providing legal platform for the accession.
The SADC Protocol on Trade endeavours to promote economic growth and regional integration. The Protocol has been in effect since January 2000. Its objectives are to further liberalise intra-regional trade in goods and services; ensure efficient production; contribute towards the improvement of the climate for domestic, cross-border and foreign investment; and enhance economic development, diversification and industrialisation of the region.
Trade in goods constitute a major area of cooperation that supports SADC’s goals of economic development and poverty eradication. Recognising that a framework for trade cooperation will benefit the region, SADC passed its Protocol on Trade in the Southern African Development Community (SADC) Region on 24th August 1996.
The Southern African Development Community (SADC) was established as a development coordinating conference (SADCC) in 1980 and transformed into a development community in 1992. It is an inter-governmental organisation whose goal is to promote sustainable and equitable economic growth and socio-economic development through efficient productive systems, deeper co-operation and integration, good governance and durable peace and security among fifteen Southern African Member States.
Seychelles’ participation within the SADC grouping dates back to September 1997 when it officially became a member. However in 2003, the Government of Seychelles decided to withdraw its membership from this Regional Economic Community (REC) due to human and financial constraints. In 2006, the Government reinitiated the process of joining SADC, and was consequently readmitted in August 2008.
The aim of SADC is to create a Community providing for regional peace and security, and an integrated regional economy. As a regional institution, it has laid the basis on which regional planning and development in Southern Africa could be pursued. Hence, several legal and institutional instruments have been put into place to guide and standardize the work of SADC with Member States. Such form of instruments include the SADC Protocols, which enshrines the aims of the Community by providing codes of procedure and practice on various issues, as agreed by Member States. Currently, SADC has 26 Protocols, including those have not yet entered into force.
By January 2008 approximately 85% of tariff lines had been completely liberalized on goods traded within the community.
Subsequently, consultations were initiated with all relevant ministries, agencies and other stakeholders within Seychelles to prepare the tariff offer.The final goods offer was adopted by the SADC Summit,held in Victoria falls, Zimbabwe in 2015.
The final offer presented that 91.2% of tariff lines to be liberalized upon implementation, with further liberalization to be undertaken over a 12 year phase down period to raise the amount to 97.5%. The remaining 2.5% shall remain excluded from the FTA coverage. Whilst Seychelles market access offer under this FTA makes provision for transition period and exclusion of certain products from FTA coverage, Seychelles’ exporters is expected to benefit from immediate duty free access to SADC FTA members that have already liberalized their market under this configuration.
The fifteen country SADC region commands a total population of 277 million people with a total Gross Domestic Product (GDP) of USD 575.5 billion, as at 2010. Seychelles originating products will now be granted freer access to the region's market thus reaping the benefits of a larger market whilst promoting imports from the region.
For more information please visit the Seychelles Trade Portal on www.seychellestradeportal.gov.sc, or contact the Trade Division of the Ministry of Finance, Trade and the Blue Economy on 4382056.