SADC, SACU and prospects of regional integration

Lovemore Chikova
Development Dialogue

Since the early days of independence in the 1950s, African governments have made regional integration a priority, coming up with several platforms from which they can achieve their mutual objectives.

Already, there are efforts to integrate economies at the continental level through the African Union and at regional levels through various groupings.

The Abuja Treaty of 1991 divided the continent into five regional areas — north, west, south, east and central.

From these regional areas, the continent now boosts of 14 regional and sub-regional groupings.

This article focuses on the Southern African Development Community (SADC) and the South African Customs Union (SACU), the two bodies that exist side by side in Southern Africa.

The two bodies have the potential to play an important role in regional integration, but a lot still needs to be done to ensure they become more effective, especially through harmonising their operations.

Headquartered in Gaborone, Botswana, SADC’s main goals are to further socio-economic co-operation and integration and political and security co-operation in the region.

The body is made up of Angola, Botswana, Comoros, Democratic Republic of the Congo, Eswatini, Lesotho, Madagascar, Malawi, Mauritius, Mozambique, Namibia, Seychelles, South Africa, Tanzania, Zambia, Zimbabwe.

Meanwhile, SACU is the oldest customs union attempt at regional integration in the world, having been formed in 1910.

It was created following the signing of the Customs Union Agreement between the Union of South Africa and its administered territories.

The body is now made up of five members — Lesotho, Botswana, South Africa, Eswatini and Namibia.

SACU provides for the adoption of common policies and strategies among its members and recognises the crucial role tariffs play as an instrument for regional integration and development.

While both SADC and SACU strive to ensure regional integration is advanced, one issue that stands out is the duplication of their membership — will all the five members of SACU also belong to SADC?

What this shows is that there are two regional bodies in Southern Africa with almost the same objectives, but dual membership for some countries.

The members’ roles thus become overlapping, in many of the cases resulting in the clashing of interests.

Member countries from SADC and SACU have been known to disagree on several issues and to argue for adoption of positions in cohorts, thereby dividing opinion on regional integration.

Yet, the major roles of both SADC and SACU as stated in various of their protocols is to enhance regional integration among countries in Southern Africa through co-operation in economic, political, social and cultural spheres.

The aim of both organisations is to enhance development within the Southern African region, while linking up with other regional groupings on the continent and eventually the African Union.

In the presence of both SADC and SACU, it has become clear that full regional integration still remains outstanding.

Bigger economies like South Africa still maintain tariffs that inhibit goods from other countries reaching their shores, while smaller economies do not realise any competitive advantage.

SADC, for instance, has 27 legally binding protocols on a spectrum of issues, including development, defence, free trade and movement of people, illicit drug trade and energy, with the aim of promoting a harmonious background for regional integration and development.

While progress is being made in other areas of co-operation like defence and security, some of the other areas are moving slowly to fully integrate the region.

SADC needs to keep evolving and re-organise itself to be ready to confront the changing world systems that have an impact on regional integration.

We witnessed such a huge shift in 2001 when the regional body had to re-organise its institutions so that it could become more articulate in driving the common agenda of regional integration.

The 2001 revision of the operations of the regional body resulted in the amendment of the Treaty that set up the body in 1992.

The amended Treaty now includes explicit issues that take into consideration development orientation, subsidiarity, market integration, facilitation and promotion of trade and investment.

SADC has since summarised its scope of work to four clusters, which are: trade, industry and investment; food, agriculture and natural resources; social and human development; infrastructure and services and special programmes.

Yet still, the regional body is found wanting when it comes to protecting the smaller economies facing the consequences of unfair trade that comes with the removal of trade barriers.

This means that in promoting regional integration, SADC member states should from time to time continue to refine the scope and sectors of co-operation and to identify appropriate strategies and mechanisms to overcome impediments to integration and to address regional imbalances.

This is supported by the Regional Indicative Strategic Development Plan (RISDP) that was formulated in 2001 by SADC, with the aim of enhancing regional integration and comprehensive development within the region.

The RISDP was meant to accelerate the fight against poverty and attainment of economic and non-economic development goals.

The success of SADC in regional integration depends on how far it goes in instituting comprehensive development and the eradication of poverty.

But this does not mean the regional body has been hopeless in pushing regional integration — it has done a lot within its means to achieve its goals.

SADC has been at the forefront of creating dynamism which has resulted in the establishment of several regional treaties that have catapulted the body to be respected in terms of integration.

On the economic front, the region has made some significant progress, as all member states now have faith in market oriented economic policies through which they are gradually opening up for trade both within the region and outside the region.

SADC has managed to enjoy peace and political stability because of the quick intervention of the regional body in solving conflicts through the SADC Organ on Politics, Defence and Security Co-operation.

On the other hand, SACU has registered its own successes on tariff liberalisation and establishing advanced integration when it comes to a customs union.

Apart from the customs union, the organisation has a common external tariff and four of its members – South Africa, Lesotho, Eswatini and Namibia – have a common monetary area that recognises the South African rand as a common currency.

The common monetary area encourages integration among the member states as they can produce goods and services at par and trade without problems of weighing the advantages and disadvantages of currency exchanges.

SACU also boosts of a legal framework that seeks to expand integration through coming up with a common industrial development policy, co-operation in agriculture and mutual agreement on competition policies. Looking at the bigger picture, it is the contradictions in regional integration that arise as a result of the existence of SACU alongside SADC that raises concern.

Both have similar goals anchored on enhancing development and regional integration in the region.

What makes it even a major cause of concern is that SACU is made up of only five members who are all members of the 16-member SADC.

The major difficulty is when it comes implementing protocols aimed at regional integration that are not uniform for both SACU and SADC.

SACU members, for instance, are not allowed by their protocols to enter into new preferential trade agreements with third parties, yet they are in SADC where they are supposed to implement similar agreements with 11 other states.

This alone has presented a major problem on regional integration programmes.

SACU has often come up with agreements viewed as undermining regional integration in cases like when it negotiated Economic Partnership Agreements with the European Union without involving SADC.

This is likely to result in disruption of regional integration as other SADC member states are left out in such important instruments of co-operation.

It is important that SACU has since realised the threat posed by such actions to regional integration and has set up a task team to look into how its activities can be harmonised with the larger SADC bloc and to advise on how issues and challenges for deeper regional integration can be addressed.

Considering the above arguments, it can be concluded that for both SADC and SACU to be more effective in promoting regional integration, they should form one body or a common platform where they harmonise their activities.

The existing separate structures involving members of the same bloc have proved contradictory and assist in derailing quick movement towards full regional integration.

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