The fall in the prices of raw materials such as cotton, coffee and cocoa in the 1980s led to the establishment of industrial free trade zones by African states. These economic zones which are currently being run in most parts of the continent, provided reliefs to investors who enjoyed benefits ranging from preferential taxation, to cheap labor among others. Analysts believe that the African Free Trade Zone agreement will help intra-regional trade and boost growth.
In return, a large number of jobs were expected to have been created including huge exports by these investors. But have these targets been achieved?
Jean David-Mihamle accesses the concept of the free-trade zones in Africa on the business segment of The Morning Call.
We estimated that one of the factors which would have enabled the continent to rake in more revenue or income is the industrial free zones...Unfortunately, the state coffers are almost empty. And when you do not pay vat, the state is forced to adopt to the economic zones.