OSBP TO HELP CUT LOGISTICS COSTS

MBABANE – One-Stop Border Policy (OSBP) will reduce logistics costs and allow easy flow in trade.

This was the reaction of the Federation of Eswatini Business Community (FESBC) on the news that South African President Cyril Ramaphosa’s cabinet has approved a draft OSBP for public consultation.

In a post-cabinet briefing on Friday (4 December), government said that the creation of the OSBP seeks to ‘harmonise the movement of people and goods between South Africa’s land ports of entry and its neighbouring countries’, as reported by BusinessTech. 

Costs

FESBC Vice President Hezekiel Mabuza said the policy would cut logistics costs in the sense that previously, insuring goods in transit meant paying excessive costs through all the ports of entry that the goods would go through, but with an OSBP, all would be paid in one setting and goods would be transited smoothly. 

“It will also help us to know the requirements on the other side of the border without having to engage the services of a consultancy in the trade process,” he said. 

According to the SA cabinet, the proposals in the policy further seek to address congestion which results in delays, particularly for cross-border travellers and traders.

“This policy gives effect to the One-Stop Border Framework that was adopted by Cabinet in 2018. 

At a continental level, the policy contributes to the Presidential Infrastructure Champion Initiative, which advances interconnectivity amongst African countries to address infrastructure deficit and boost intra-Africa trade,” the cabinet said.

The draft policy will be gazetted for public comment during the first quarter of 2021.

Preparation

The new border policy comes in preparation for the new African Continental Free Trade Area (AfCFTA) which will come into effect from January 1, 2021.

The AfCFTA aims to build an integrated market in Africa that will see a pool of over a billion people with a combined GDP of approximately E49.6 trillion (US$3.3 trillion).

The United Nations Economic Commission for Africa estimates that the AfCFTA will increase intra-Africa trade from the current 10 per cent -16 per cent to approximately 52 per cent by the year 2022.

Ramaphosa has said that through the trade area, the continent’s leaders are determined to build strong and inclusive economies through industrialisation and the beneficiation of the minerals and commodities.

“The AfCFTA is a significant development that will change trade patterns and has the potential to transform African economies,” he said in November.

“It will encourage economic diversification, beneficiation of our minerals and resources and value-addition to seize the opportunities arising from an increasingly open African continental market.

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