March 10, 2005

Preferential trade agreement with Zimbabwe

A preferential trade agreement between Mozambique and Zimbabwe has taken effect. Under the agreement, tariff and non-tariff barriers are eliminated on a wide range of goods from both countries which meet agreed rules of origin. The purpose of the agreement, the Ministry release states, "is to guarantee an increased flow of goods between the two countries and to ensure that trade is free and permanent". Nonetheless the agreement excludes a variety of "sensitive" goods, which have been placed on a negative list. These goods are sugar, beer, soft drinks, tobacco products, motor vehicles and firearms, ammunition and explosives.
From Mozambique's viewpoint the most important product excluded is sugar. The Mozambican sugar industry enjoys protection in the domestic market, with a surtax levied on all legal imports of sugar. Mozambican sugar companies in the past have complained bitterly at the unfair competition posed by sugar smuggled in from neighbouring countries, particularly Zimbabwe. The Ministry statements say that the rules of origin in this agreement were simpler than those established in the SADC (Southern African Development Community) trade protocol. Goods covered by this agreement must enter or leave Mozambique at the four main border posts - Machipanda and Espungabera in Manica province, Chicualacuala in Gaza, and Cuchamano in Tete. (Agencia de Informacao de Mocambique, Maputo)

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