SACU Must Get Its House in Order – Expert

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By Wezi Tjaronda WINDHOEK A senior researcher says it is up to the political leadership of the Southern African Customs Union to tackle challenges and adopt common policies and institutions as enshrined in the new SACU agreement before any agreements with a third party can be concluded. A research fellow with the Trade Law Centre for Southern Africa, Professor Gerhard Erasmus, says the development and prosperity of the whole region is staked on whether a new agreement is to be concluded. Erasmus, commenting on whether SACU should negotiate free trade agreements (FTAs), said the new SACU agreement, finalised in 2002, promises to make some changes and address the need for common institutions and common policies, which he says have not yet been achieved. Considering that it is still business as before, the researcher says, SACU is not yet ready to engage the USA, despite the fact that it is a single customs territory. This stems from the failure last month for SACU and the USA to conclude an FTA, which promises to be a permanent predictable trade arrangement between the two parties, because a number of substantive issues had risen up in the negotiations, which would require detailed examination over a longer time frame. “Without a new agenda on integration, and regional development, its sustainability for integration into the global economy is not entirely clear,” he said. While Erasmus welcomed the decision by the two parties not to conclude the FTA negotiations now because there might be political factors at play, he said SACU needs to put its house in order for a rules based arrangement. He said the five SACU member states, namely, South Africa, Namibia, Botswana, Lesotho and Swaziland have yet to integrate their national systems to cover the comprehensive arrangements covering the services, intellectual property, investment and new generation issues disciplines. “This customs union is limited to trade in goods and related customs matters,” said Erasmus, adding: “Actually, the sharing from the common revenue pool is the glue that keeps the arrangement together, not their common policies.” The researcher also cautioned the union about the context of the last Trade Policy Review of SACU by the WTO in 2003, which listed a number of concerns of effective coordination and integration and lack of common policies for certain non-tariff measures such as customs procedures, quantitative restrictions, standards, technical regulations, competition policy, sanitary and phytosanitary measures and internal taxes. SACU, the oldest customs union in the world, re-negotiated the New SACU Agreement, which provides for a more democratic institutional structure, a dispute settlement mechanism, the requirement to have common policies on industrial development, agriculture, competition and unfair trade practices and a new system regarding the common revenue pool and sharing formula.