MASERU — The Southern African Customs Union (SACU) Council of Ministers convened a two-day meeting to review challenges and to deliberate on the future of the oldest customs union in the world.
The conference was held in Swaziland last Thursday.
SACU is made up of five countries — Botswana, Lesotho, Namibia, South Africa and Swaziland.
The meeting was chaired by Namibian Finance Minister Saarah Kuugongelwa-Amadhila. Namibia took over the chairmanship of SACU from Lesotho on July 15 this year.
According to a press statement released by the SACU secretariat, the meeting agreed on the need for SACU countries to regroup and redouble their efforts.
“The SACU Council of Ministers agreed to regroup and redouble their collective efforts to resolve the outstanding issues in the Interim Economic Partnership Agreement (IEPA) and Final Economic Partnership Agreement (EPA) negotiations,” the statement read.
Finance Minister Timothy Thahane, who represented Lesotho at the meeting, said: “The three countries that have signed an IEPA with the EU have done so to protect their export trade. Countries were allowed to sign the interim partnership after discussions between SACU members.”
Botswana, Lesotho and Swaziland (BLS) signed an IEPA with the European Union (EU) in June this year, while two other members of SACU, South Africa and Namibia, refused to sign the agreement. This has since caused confusion within the SACU region.
Thahane said there was a common agreement discussion within the SACU region prior to the signing of the IEPA. However, South Africa and Namibia decided not to sign.
“There is need to harmonise the agreements within the SACU countries, the one South Africa has with the EU on one hand and the interim economic partnership agreement signed by other countries on the other,” he added.
“In the meeting there were seven issues which were discussed. We agreed on five and are working on the remaining two issues,” Thahane said.
Thahane said the ministers agreed to continue to work together even though there were some challenges facing the customs union.
“There is more to SACU than just regional integration, even if there are problems along the way we still continue as a unit,” Thahane said.
Other issues discussed at the meeting included the common SACU revenue pool which is said to have declined. Most of the countries in the SACU region depend largely on the revenue collected within the customs union. Lesotho depends heavily on the revenue it receives from SACU, which accounts for 60 percent of the national budget.
“With changes in the economic well-being of member countries, SACU revenue has decreased and that means Lesotho’s revenue is going to decrease. The most important thing is how we are going to cover for the loss in revenue,” Thahane said.
According to the statement, the council reviewed the recent developments in SACU, progress made in the achievement of the objectives of the 2002 agreement, as well as developments at regional and global level.
On the issue of SACU’s trade strategies, the council of ministers discussed the need for a common SACU trade strategy and trade negotiation agenda and agreements on the content of negotiations SACU is prepared to enter into “taking into account the capacity of member states. The council supported trade diversification as an important objective to be pursued in trade relations and negotiations,” said the release.
The council directed the commission to develop a SACU vision, strategy and work plan with a time frame with respect to a number of identified priority areas.
These areas include following the principle of unified engagement amongst SACU member states in trade negotiations with third parties — including in the SADC-EC IEPA and EPA negotiations — while recognising different levels of development and capacity of member states.
Other key result areas drawn up for the commission include developing a SACU trade and tariff policy, and trade strategy which supports industrialisation within the SACU region and defining a roadmap for moving toward an economic community and monetary union.
