Tally – Ho: 2018 “The best way to predict the future is to create it “– Peter Drucker

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Tuesday, 16th January 2018

 

“The best way to predict the future is to create it “– Peter Drucker

 

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FESARTA has a regional perspective and overview of the range of national and interstate transport activities on the drawing board. As we face the start of 2018 there much evidence of energetic activity to create a better future for transportation in the Southern and East African region. These cover a wide range of developments with a common thread of improving efficiency.

In the EAC region there is the continued focus on adding to, and improving the eight One Stop Border Posts that are making such dramatic improvements to transit times. The creation of the Single Customs territory and the consolidation of fees and charges has greatly reduced delays. The massive queues of trucks at Malaba, Busia and other borders are now history, and the impacts on economic activity are starting to show, with landlocked countries being the major beneficiaries, although the coastal countries still dominate the transport sector.

As part of its enlightened approach to promotion of economic activity in the region, COMESA is extending the scope of the highly successful Regional Customs Transit Guarantee (RCTG) from EAC to other corridors. COMESA will liaise with FESARTA to make the system available to transporters, forwarders and exporters throughout the region. The scope of the guarantee, the cost of the carnet, the simplicity of the process and the built in tracking and control system make it the most attractive option for cross- border efficiency and interstate trade. Recent contacts with the COMESA Executive show exciting prospects for increased focus on policies to support economic growth instead of revenue collection from borders.

In SADC region the development of the new bridges and future OSBPs at Kazungula and Beit Bridge give new hope for future efficiency at the relevant borders. The infrastructure developments must however be accompanied by significant revision of border policies if delays are to be reduced and in this regard FESARTA will be engaging with RECs to encourage them to build on the successful policy changes made in EAC.

2018 will also hopefully see the beginnings of the implementation of the SADC-Tripartite, Transport and Transit Facilitation Programme (TRIPS) with its focus on the harmonisation of transport regulations, repeal of cross-border permits, registration of transport operators and their Responsible Competent persons (RCPs) and the supporting IT database covering the entire region. It is also to be hoped that the South African Road Freight Strategy approved by Cabinet in 2017 will be implemented with the many recommendations for changes to currently unworkable and ineffective regulations.

All of the activity planned for the freight transport sector is based on the very logical underlying assumption that improving transport efficiency will be good for economic development. It must however be noted that in most countries of the region the current systems are in many ways diametrically opposed to the creation of businesses, with the heavy hand of bureaucracy stifling initiative and increasing the burden of cost. As pointed out by Hausman,[1] the emphasis on protective indigenisation in whatever form, stifles the importation of capital, technical ability and entrepreneurship. Assumptions that the current regional population with limited existing skills and entrepreneurial experience can create an industrial revolution, directed by the bureaucracy, are somewhat unrealistic. Policies which encourage the import of skills and abilities lead to increased business, employment and therefore wealth creation and ultimately, improved tax revenue. Zambian agricultural development is evidence of these effects.

The imposition of increasing cross border charges for permits, carbon tax, fees, levies, and tolls for cross-border transport is passed on to the industrial customers and simply increases the costs of goods in the destination countries. On the North –South Corridor this amounts to about 30% of total transport costs, with a further 25% of cost being caused by official delays.

The costs of bureaucracy lead eventually to industrial stagnation[2] as the impacts of National Socialism stifle the economy. In relation to industrial development, freight transport is the tail on the dog, so all the current projects to improve transport efficiency may prove to be somewhat irrelevant, unless there are policy changes which lead to future economic growth in the countries of the region. In this respect 2018 may prove to be watershed year if the significant obstacles to economic liberalisation are cleared and new trajectories are established.

 

[1] Is South Africa about to make an historic mistake? – Prof R Hausman (CDE RSA) June 2017

[2]   p9  Bureaucracy – Ludwig von Mises : DAS Victoria BC (ISBN 978-1-77323-046-7)

 

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