NAIROBI - Plans to create a 26-nation free trade area by integrating three existing African trade blocs by July 2014 are on track and the only major sticking point is likely to be harmonising rules of origin, the three blocs said on Friday.

The East African Community (EAC), the Common Market for Eastern and Southern Africa (COMESA), and the Southern African Development Community (SADC) aim to create a free market of 525 million people with an output of $1 trillion when they unite.

Although African economies are growing fast - second only to Asia - the continent has attracted criticism over its slow pace of integration, a delay that is seen as driving up the cost of doing business.

Sindiso Ngwenya, secretary general of COMESA, said tough negotiations on rules aimed at making cross-border trade easy for firms and small traders lie ahead.

"The major challenge for the tripartite FTA negotiations will be rules of origin. Whereas COMESA and EAC have identical rules of origin, SADC has got different rules of origin so we have to engage with them," Ngwenya said.

The World Bank said in a report in February that red tape and trade barriers were costing Africa billions of dollars and depriving the region of new sources of economic growth.

Ngwenya however said the process would move quickly because of the experience gained in building the existing trade blocs.

"For us there is nothing new in this FTA (free trade area) because it is something that is already there," Ngwenya said.   Continued...