SADC recommits to common currency



SADC leaders from eight member countries met in South Africa last week for an emergency “extraordinary summit” aimed at reviewing the region’s slow progress towards economic integration.

SADC chairman, Pakalisa Mosisili convened the meeting to address regional concerns over the bloc’s failure to transform its vision for a regional economic union into action.

Mosisili said the grouping was in a desperate need to “get its act together” on its hopes of economic integration and that the meeting was convened due to the pressing “need to upscale and intensify regional economic integration and political co-ordination”.

South African Foreign Affairs spokesperson Ronnie Mamoepa said SADC leaders were worried by the sluggish progress on integration, and that the meeting had been intended to “unblock logjams that may create obstacles”.

“The leaders are concerned about the slow pace of progress compared with other regions in the continent. We are confident that the heads of state today will chart the way forward to ensure we meet the 2008 deadline,” he said.

Apart from economic challenges haunting the region, Mosisili also hinted at internal haggling within the bloc.

“As we march towards the Customs Union we need to remind ourselves this is a give and take affair.

“The talks today were focused on ensuring that we are all winners and that there would be no losers in integration, that the small economies will be also catered for and will benefit fully,” Mosisili said.

At last week’s meeting, Botswana President Festus Mogae, Swaziland Prime Minister Absalom Themba Dlamini and Zimbabwe’s President Robert Mugabe became the latest signatories to the Protocol on Finance and Investment, believed to be the cornerstone for improving the region’s economic environment.

The three brought the number of signatories to ten, after the Democratic Republic of Congo, Lesotho, Madagascar, Mauritius, Mozambique, South Africa and Tanzania signed it in August.

Nine countries were required to sign the protocol to get it implemented in the region.

In spite of the latest “recommitment” to the economic development goals observers are still sceptical over the region’s ability to achieve its ambitions, which have been fraught by delays since the inception of the programme.

At a recent SADC summit held in Botswana , member countries again reaffirmed their commitment, saying they were still focused on creating a uniform currency for the region and achieving other economic targets aimed at achieving economic integration in Southern Africa.

Mosisili also told that meeting that the region was “lagging behind” on the issue of economic integration and that “it is high time something was done about that”.

Following the August meeting, the finance ministers of all member states were tasked with formulating measures to speed up the implementation of these agreements and reporting back to the grouping by the end of October. While last week’s meeting was meant to be the report-back meeting, observers believe more could have been done to show the commitment to action.

The analysts believe the latest commitment is “just one of many that have been made” regarding the strategic integration plan, which has been on the cards for several years now.

“There would certainly be a great degree of scepticism because this (development programme) has been talked about for some time now but we have seen nothing on the ground that indicates progress,” a Southern Africa Regional Poverty Network trade researcher said.

Poor economic conditions in some SADC member states have been touted as the major reasons for the monetary union failing to take off, as members are required to have a degree of uniformity in economic performance before the union is achieved.

South African deputy foreign affairs minister Aziz Pahad recently said SADC member countries were battling to achieve individual economic stability before starting on the unification programme, which would only work if weaker countries were not a burden to others. With economic fortunes for countries such as Zimbabwe and Malawi continuing to be precarious, it could be some time before the regional economic development programme really gets underway and begins to bear fruit.

Challenges in curbing the damaging effects of HIV/Aids have also scuttled the bloc’s efforts towards regional economic integration.

The initial stage of the regional integrated strategic programme would see all countries that are members of the SADC grouping taking up a uniform currency by 2008, leading to the establishment of a regional monetary union by 2016.

As part of the process towards integration, SADC countries have also agreed to scrap tariffs on 85 percent of all goods by 2008, establish a customs union by 2010 and a common market by 2015.

October 2006
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