Put your money where your mouth is.
That is the challenge issued to authorities in Barbados and other Caribbean countries as well as leaders in Africa, as they continued high-level talks on the establishment of a direct airlink in an effort to increase tourism and trade and investment between the Caribbean and Africa.
Herbert Krapa, Deputy Minister of International Trade in the Ministry of Trade and Industry of Ghana, warned that unless authorities address issues relating to business facilitation, tax and tariffs, and providing the necessary incentives for the private sector to invest, then the direct airlink would be nothing but a pipe dream.
“The issue of logistics to ensure we have a dedicated carrier between our two regions is as crucial today as it should have been a couple of years ago,” said Krapa.
“I think governments across the divide must put our money where our mouth is. We must make the right investments and provide the incentives, and the private sector, while government is making the investment into those areas, also needs to complement the capacity-building to ensure they see and seek opportunities,” he said.
“We are not going to be able to do this [direct airlink] if we do not have a commercial case for it. The reason it has not been successful all these years is because there has not been a viable economic case for it. So we have to look at it from that standpoint,” he suggested.
Krapa was speaking during a panel discussion on day two of the three-day AfriCaribbean Trade and Investment Forum 2022, being held at the Lloyd Erskine Sandiford Centre under the theme One People, One Destiny: Uniting and Reimagining Our Future.
Pointing to the various agreements and memoranda of understanding being signed during the conference, he stressed that what would drive the airlink is increased investment and improved business environment.
He suggested that CARICOM be added to the African Union guided trade, a precursor to the full implementation of the African Continental Free Trade Area, as a “test module” to determine how the air transport service between the two regions could be expedited.
Krapa, who joined other panellists to discuss the topic Improving Logistics Between Africa and the Caribbean for the Promotion of Tourism, Trade, Telecommunications and Investment, said he was pleased with the approach being employed by the African Export-Import Bank (Afreximbank) to encourage increased investment.
However, he maintained that countries needed to have the right legal regulatory framework in place.
“We have to be intentional about the framework that we put in place to drive investment across the two regions. We have not seen so much of it yet, but I think going forward we have to put in place those treaties and bilateral agreements that identify where the investment opportunities are and that harmonise the policies between both regions and countries involved to ensure there is seamless trade, tourism and investment,” he stated.
“We have to overhaul, for instance, the business regulatory framework in most jurisdictions across the regions to ensure they are business-friendly, to ensure the private sector is able to appreciate what they need to do and the legal regulatory framework that needs to be put in place to be able to take advantage of those opportunities. We will not be able to make the investment if the regulatory framework is not there,” he warned.
He also proposed that countries in the region establish joint business councils with their African counterparts, stating that this would help to “crystalise some of the obligations in the treaties to ensure that we are looking at investment opportunities, dispute resolution, tariff and non-tariff barriers and an incentive regime that allows the private sector to take advantage of the treaties”.
The Ghanaian government minister also warned countries not to be “all over the place” with the signing of treaties and bilateral agreements and then not take the necessary action.
“We know what the challenges are . . . and we know what the solutions are. I think we have to just be more practical and pragmatic about how we implement those solutions . . . and more practical and pragmatic about investment policy and setting up the business councils that would ensure that the climate is suitable for business. When governments do that and put in place the right incentives, the private sector will come on board and I am sure that investment will thrive between the two regions,” he said.
He urged authorities in each region to harmonise their investment policies.
“We can’t have policies scattered all over the place and expect that we can derive optimum results and benefits from it for the private sector. That is why I am advocating for harmonising these investment policies, putting in place for instance, the legal regime that is not only for the host country, but that makes sure the business climate in the respective countries across the region is suitable for the private sector. The private sector will shy away from venturing into business if the regulatory framework is not there,” he said. (MM)
