Vegetable imports ban reversal mitigates trade distortions- ZIPAR

Thu, 06 Apr 2017 10:17:42 +0000

By BUUMBA CHIMBULU

GOVERNMENT’S decision to reverse the ban on importation of fruits and vegetables will help avoid effects of trade distortion, says the Zambia Institute for Policy Analysis and Research (ZIPAR).

Last month, Ministry of Agriculture permanent secretary, Julius Shawa, announced the ban on the importation of some vegetables such as tomatoes, onions, carrots, potatoes, among others lemons to encourage the sourcing and supply of these products within the country.

But Government through the Ministry of Commerce, Trade and Industry and their Agriculture counterpart reversed the ban. ZIPAR research fellow, Francis Ziba, in an interview said banning imports was against the principles of the World Trade Organisation (WTO) which Zambia was a signatory to.

Mr Ziba explained that WTO prohibited restrictions on the importation or sale of products from other WTO members although with a few justifiable exceptions. “So, while one can certainly appreciate the rationale behind the ban, this type of quick fix solution is quite problematic for Zambia, decisions regarding trade with other countries should always take cognizance of Zambia’s trade commitments,” he said.

He said the reversal was welcome, saying quantitative restrictions such as bans usually had trade-distorting effects as their allocation could be problematic and their administration might not be transparent.

“Zambia currently does not need the ban because it can easily trigger a trade war resulting in a situation where two or more countries retaliate to the ban by imposing trade barriers on products from Zambia,” he said.

Mr Ziba said Government needed to consider other safeguard measures with less trade-distorting effects outlined in the WTO General Agreement on Trade and Tariffs that could be used to protect and develop local industries.

He also said imposing surtaxes on imports of these goods for instance would render imports more expensive and less competitive and simultaneously, provide increased revenue for Government from import duties.

“Government can provide subsidies to farmers aimed at growing their capabilities in addition to preferential sourcing arrangements,” he said.