ECA urges African countries to harmonize ICBT
The Economic Commission for Africa (ECA) has urged African countries to harmonize their data on informal cross-border trade.
This the ECA said has remained an important feature of Africa’s trade ecosystem.
Stephen Karingi, Director, Regional Integration and Trade at the ECA, made this appeal in a statement posted on the commission’s website on Tuesday.
Specifically, Karingi said that timely collation of the data has become crucial to the implementation of the African Continental Free Trade Area (AfCTA).
He expressed concern that in spite of its importance to the livelihoods of millions of Africans, informal trade was not well understood on the continent, a development that has compelled the African Union Commission (AUC), ECA and Afreximbank to create a Task Force that will develop a harmonised methodology for Informal Cross-Border Trade (ICBT) Data Collection.
According to him, “research by ECA estimates ICBT to be equivalent to between seven and 16 per cent of all formal intra-African trade flows and between 30 and 72 per cent of formal trade between neighbouring countries.
“In spite of its significant contribution to the economy, ICBT remains largely undocumented and current efforts to collect data on ICBT within the continent are largely fragmented and unsystematic, ” he said.
A major challenge to gathering the necessary data he said can be traced to differences in definitions and methodologies used by various countries and organisations thus hindering the comparability of available data and integrating into formal trade statistics.
Giving the unreliability of the data on ICBT, Karingi noted that this has resulted in the minimal recognition of the importance of ICBT in policy frameworks.
According to him, “accurate trade statistics are important inputs to national accounts and balance of payments statistics and they also help to improve econometric forecasting models for key macroeconomic variables”.
