Breaking Cross Border Trade Barriers Amid AfCFTA

Mchinji - Mwami OSBP Mchinji - Mwami OSBP - file photo

The launching of Mchinji – Mwami One Stop Border Post (OSBP) by the Malawi President, Lazarus Chakwera and his Zambian counterpart, Hakainde Hichilema on 7 December, 2022, marked a significant stride in trade integration between the two countries and, of course, the region.

The facility has brought in convenience, improved cross border trade and revenue collection among the cross-border traders who bemoaned tiresome process they had to go through prior to the new development.

Huge paperwork, long time of waiting and incurrence of avoidable costs were a burden on the traders’ shoulders as they plied their respective trade.

Testimony

OSBP concept is a border facility that combines two stops of adjourning border controls into one. It is aimed at reducing the number of stops and processes associated with cross border transactions to ease trade and movement of people.

Our visit at the post three weeks after its inauguration found busy activities. All what we saw was improved collaboration, interaction and cooperation between border agencies.

We noticed how the automated data sharing system was quickening customs clearance and reducing the processing time for key transactions.

No wonder, travelers and business people from both countries were seen clearing their goods without difficulties.

Our interaction with cross border traders, Osini Mwale and Thandizo Mtambo from Malawi and Golden Banda from Chipata in Zambia testified the gains realized from the facility.

The two Malawians told Zodiak Online that that in the past, they would stay for a day or two to clear goods but now they are just spending less than three hours.

“It is now possible to move with goods from Zambia to Malawi and go back to Zambia the same day. This is making us fetch more money. This facility has indeed assisted us,” said Mtambo.

On the other hand, Banda said that in the past three weeks he has been able to save about $300 which he said could have been used for accommodation, meals and others due to delays to clear his goods before.

“The processes here are faster. It is now very easy to move with goods such as electronic items, second hand clothes and farm produce from Zambia to Malawi within a day,” said Banda.

Malawi Revenue Authority Deputy Commissioner for Customs and Excise responsible for Trade Facilitation, Chimwemwe Kawalewale said the new OSBP has tremendously improved to reduce time that traders and travelers stay at the border.

“In the old setting, traders would stop on the Malawi side and move to the Zambia side and stop again and repeat the same processes but with OSBP, the hectic processes were removed,” said Kawalewale.

Desire for more

Olafu Sanga, secretary for the Malawi Small Scale Cross Border Association for the South, told Zodiak Online that “it is our desire that we have more OSBPs at Mwanza, Dedza and Songwe borders in order to facilitate trade with neighboring SADC countries like Mozambique and Tanzania.”

President of Southern African Cross Border Traders Association, Jacob Makambwe, says that the Mchinji-Mwami OSBP has brought a lot of relief among cross border traders.

“Initially, it was extremely difficult to clear goods but the harmonization is so helpful as it is increasing volumes which traders are trading between the two countries,” said Makambwe.

He adds that they are planning to conduct a study to see how much is being saved from the existence of OSBPs in the SADC region as compared to when there were none.

Makambwe has since asked countries in the region to invest more resources for the construction of such facilities in order to enable quickest movement of goods, services and efficiency in business.

“With the availability of such posts, time spent on the border is drastically going to be reduced. As we are going into the implementation of the African Continental Free Trade Area, countries should do the needful,” said Makambwe.

Political will

Sources in the Ministry of Trade and Industry in Malawi say the new OSBP has assisted to reduce the time of processing imports and exports by 70 percent.

And this has motivated the country to do more as it is intending to inaugurate Songwe, Mwanza and Dedza OSBPs this year.

President Chakwera said during the commissioning of the Mchinji-Mwami OSBP that the facility will improve regional and economic integration between Zambia and Malawi.

“The Post is good news for travelers, for traders and for our economies. It is also good for investors for harmony and solidarity,” said Chakwera.

He further explained that the OSBP will also promote security for the people of the two countries as they will be serviced in a friendly environment.

His counterpart, Hichilema, said he was hopeful that the Mchinji/Mwami OSBP facility will spur higher trade flows and economic activity in the Nacala Corridor.

The Zambian President said it is time for the two countries to reduce road blocks and check in points on the roads to ease movement of goods and people.

“I call on ministries of home affairs in the two countries to ensure that they reduce some of the road blocks which delay movement of people, in the same vein this should not compromise on security and encourage trafficking,” he explained.

The Mchinji-Mwami state of art OSBP was constructed with financial support from African Development Bank, the European Union (EU) and the Common Markets for Eastern and Southern Africa (COMESA) to the tune of about 60 million Euros under the Trade Facilitation Program.

This is an attempt to reduce barriers and improve access to markets and ports in landlocked countries in the region considering that the inter-regional trade remains low at 10 percent of total trade in the area.

Further to it, trade and transport costs in the region remain highest in the world thereby coming up with OSBPs initiatives to build resilient and sustainable economies.

(by Happy Njalam’mano and Christopher Sande)

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Last modified on Tuesday, 14/02/2023

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