[ Export promotion ]

Trade Africa coaches SADC’s LDC members

“Zambian exporters have benefited greatly from the buyers-sellers meeting,” says Glyne Michelo, executive secretary of the Export Board of Zambia (EBZ). The business-fostering gathering in Johannesburg was so far the highlight of the promotion programme that InWEnt offers in the SADC zone under the name Trade Africa Intra-Regional Export Promotion. The project covers with Malawi, Mozambique, Zambia and Tanzania the least developed countries (LDCs) of the region as well as South Africa as a potential trading partner. Its core is an integrated, networked advanced training programme based on local know-how. The aim is to make export promotion institutions in the individual countries more professional.

Trade among the SADC countries totals more than US$ 5 billion per year, or about 20 per cent of the region’s current overall trade volume. By African standards that’s a big market share. A closer look, however, puts the positive general impression into perspective. The dynamism of the intraregional exchange is due mainly to South Africa’s foreign trade, which almost doubled between 1994 and 2002. By contrast, exports from Malawi to Tanzania or from Mozambique to Zambia are next to nothing – despite their regional proximity.

The intraregional trade has a largely unexploited potential – especially in food and semi-luxury items, textiles and clothing. The rich raw materials reserves also present development opportunities through exchanges in the region. The SMEs, however, lack information: on their neighbouring countries, on the regional market, and so on. South Africa is one of the most important trading partners for all the project countries in the Trade Africa programme. In reverse, South Africa needs the region. More than 40 per cent of its exports go to the SADC zone.


Practical training

The InWEnt programme, which has been running since mid-2002, is aimed at SMEs in the SADC’s four poorest countries that are capable of exporting. Practical training is meant to enable them to export their products to the neighbouring states. These countries are not only a market that should not be underestimated, but also an important test field for the much more complicated business of exporting to Europe. Exports to Europe and the USA via South Africa as an intermediate processing stage are already routine. The companies involved develop within the framework of Trade Africa the relevant instruments and techniques of international marketing and trade.

The participating SMEs must pay a customary fee for the training. That is to ensure that they go through all the modules to the end and don’t lapse into the role of a consumer. On the other hand, it also means that the local training and export promotion institutions (who as local partners are responsible for implementation on-site) generate income. And the course participants see the training as a service they have bought. The Internationale Trade Center (ITC), the Association of Chambers of Commerce of the SADC countries, the SADC Secretariat and the Common Market for Eastern and Southern Africa (COMESA) support the programme.

The distance of the haul to success varies from country to country. In Malawi, 90 per cent of the population lives from farming, although on the other hand the small country also has extremely innovative small enterprises. Mozambique has since its civil war made considerable economic progress, but still imports twice as much it exports. Zambia cannot get going despite good starting conditions (copper, cobalt, etc.) because sectors are promoted only selectively and without linkage to each other and the country’s negative business environment remains unchanged. Tanzania still lives from traditional farm produce exports.


Market and demand

The buyers-sellers meeting, organised by the Johannesburg Chamber of Commerce and Industry together with InWEnt, showed the opportunities for aspiring enterprises. Thirty companies from Malawi, Mozambique, Tanzania and Zambia that are cared for within the framework of Trade Africa met 400 potential South African customers there. The programme participants had gained the knowledge they needed for doing successful business during a five-week training course. Many companies find it difficult to orient themselves clearly on the market and demand.

The Southern African Development Community (SADC), founded in 1993, is the leading economic area in sub-Saharan Africa. Its 14 member countries (Angola, Botswana, DR Congo, Lesotho, Malawi, Mauritius, Mozambique, Namibia, Zambia, Seychelles, Zimbabwe, South Africa, Swaziland and Tanzania) have a combined gross domestic product of US$ 180 billion. South Africa accounts for three-quarters of the region’s total income.

The two-day business-fostering meeting in Johannesburg was a mix of addresses and trade fair. Besides traditional products and arts and crafts (wickerwork, wooden articles and textiles), the sellers also exhibited foodstuffs such as honey as well as a great number of other products from their region. Innovative new products are still the exception. Many South African companies were surprised by the high quality of large numbers of the products. At the end there were entirely satisfied expressions on people's faces.

The 10 Zambian companies that took part in the cooperation exchange signed contracts worth a total of US$ 300,000, and also secured favourable supplier sources for machinery and raw materials. Malawi booked orders worth several million US dollars. In addition, programme participants and South African companies signed cooperation agreements on motor vehicle and furniture manufacture. “The training programme was a complete success,” sums up Glyne Michelo. He’s confident that the Zambian participants will fulfil the orders on deadline.

Further information at
http://www.trade-africa.org
Lydia Jebauer-Nirschl
is Project Manager in the InWEnt Department
“Sustainable Economy”.
lydia.jebauer-nirschl@inwent.org