One Hundred But Not Out: What Future for SACU? (May, 2010)
The integrity of SACU has been put under enormous strain owing to continued divisions within the organization concerning the equitable distribution of revenues and the acrimonious Economic Partnership Agreement (EPA) negotiations with the European Union (EU). Media reports suggest that the South African government may use these divisions to push for a “downgrading” of SACU from a customs union to a free trade area (FTA); reports emanating from Botswana indicate that sentiment there may be moving in a similar direction.
However, downgrading SACU may conflict with a key post 1994 South African foreign policy pillar: the desire to promote deeper integration in southern Africa and build South African influence in Africa. If South Africa is seen to precipitate the dismantling of SACU, arguably the most effectively functioning regional integrative arrangement in Africa, its African peers (and indeed the international community) may react negatively.
Coming on top of international criticism of South Africa’s handling of Zimbabwe’s crisis, this has the potential to degrade Pretoria’s international standing with uncertain consequences for South Africa’s foreign policy. Furthermore, downgrading could substantially prejudice South African trade and investment interests in the BLNS directly, and indirectly if other countries (the EU, and emerging markets Brazil, India and China seem likely candidates) reacted by increasing their market share. This could have substantial implications for key pillars of South African industrial policy, notably the motor industry and clothing policies, since BLNS markets purportedly comprise large shares of exports of those industries.
Clearly the political economy of SACU’s future is complex. Decisions taken in South Africa over the next few years are likely to be determinative since South Africa dominates and underwrites the organization. But the likely direction of those decisions under the Zuma Administration remains unclear and contested.
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Programme
09h00 – 09h30 Registration
09h30 – 09h45 Opening and Welcome
Peter Draper, Trade Programme Head, SAIIA
09h45 – 10h45 Keynote Address: SACU – Towards 150 Not Out?
Ms Tswelopele Moremi, Executive Secretary, SACU [speech]
10h45 – 11h30 Session 1: How important is SACU to its member states?
This session will concentrate on the economic empirics
concerning SACU. Specifically, what is the extent of intra-
SACU trade and FDI, and how important is this to South
African business in particular.
Moderator: Shibe Maruatona, Business Leadership South Africa
Presenter: Peter Draper, Trade Programme Head, SAIIA [presentation]
Discussants: Dr Matthew Stern, Development Network Africa
Roger Pitot, Executive Director, National Association of
Automotive Component Manufacturers
11h30 – 12h00 Tea
12h00 – 13h00 Open discussion
13h00 – 14h00 Lunch
14h00 – 15h30 Session 2: Presentation of interim findings from a SAIIA
research project
This session will put forward findings from the SAIIA research
project investigating perspectives from key stakeholders in
SACU member states and Angola concerning the future of
SACU and Southern African regional economic integration.
Moderator: Xolelwa Mlumbi, Chief Director, DTI
Presenter: Talitha Bertelsman-Scott, SAIIA Research Associate
[presentation]
Discussants: Dr Roman Grynberg, Senior Research Fellow, BIDPA,
Botswana
Jurgen Hoffman, Agricultural Trade Forum, Namibia
15h30 – 16h00 Tea
16h00 – 17h30 Concluding panel: A darkening horizon?
This session will concentrate on challenges on the horizon for
SACU encompassing, inter alia: the tripartite free trade
agreement negotiations involving SADC, COMESA, and the
EAC; regional geopolitical alignments; and the ongoing EPA
negotiations.
Moderator: Professor Richard Gibb, Plymouth University, UK
Panelists: Mark Pearson, Director, Trademark
Dr Brendan Vickers, IGD
Dr Mzukisi Qobo, SAIIA
