SACU must do more: Sithole

SACU Council of Ministers chairperson Majozi Sithole said as SACU had been tested and proved to be a success, it “should be the nucleus of a SADC customs union”.

The council of ministers has been meeting in the Botswana capital, Gaborone, to iron out some issues.

Majozi also said all SACU members belong to SADC, while other trade blocs such as the Common Market for Eastern and Southern Africa (COMESA) have members outside SADC.

He also revealed that the new SACU agreement places emphasis on negotiating as a group, which was a contentious issue as large economies like South Africa unilaterally struck deals with partners such as the European Union, a move seen in some circles as undermining SACU.

Majozi, who is the Finance Minister of Swaziland, a country that also belongs to COMESA, admitted that they did not join COMESA for purposes of a customs union, but rather as a trade bloc.

“In fact, we export a lot to COMESA than what we import,” he said.

Multiple membership was a burning issue, Majozi said, adding that SACU would need to move swiftly to consolidate its position in an effort to be better positioned for the planned SADC customs union. This overlap translated into costs ranging from negotiating resources and capacity, to often complex administrative costs relating to rules of origin, he said. It also resulted in conflicting objectives which hindered progress in many areas.

“We will be assigning officials to do an assessment of this issue and all that relates to it, and the implications of a free trade area. Meanwhile countries will have to do their cost benefit analysis to determine where they would benefit more,” said Majozi.

Apart from being technically impracticable to belong to several customs unions, the World Trade Organisation does not allow such a scenario.

During his tenure, Majozi said he intends to address the future management of the common revenue pool and issues pertaining to intra-SACU trade data, the development of a strategic framework for trade negotiations, development and approval of a common negotiating mechanism

SACU comprises of Botswana, Lesotho, Namibia, South Africa and Swaziland, and the Council of Ministers is the supreme decision-making authority on all SACU matters. Currently Swaziland chairs the union, a position that rotates annually among member states in alphabetical order. ‘ Bopa-New Ziana.

September 2006
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