Rikus Grobler | Oct 18, 2017 | 0
Impetus needed for SADC economic integration
Needed Impetus for SADC economic integration The Southern African Development Community (SADC) is faced with a lack of the much-needed intellectual and political steam to drive its economic integration process. The need is greater now than before due to increasing fragmentation resulting from negotiations for Economic Partnership Agreements and delayed progress on various frontiers of regional integration. There is weak cohesion among member states with varying ideological differences. The vision for the region is being compromised. National interests are strongly conflicting with a collective regional effort. As these elements are becoming common, a question that arises is: how will SADC move forward to achieve economic integration? The next step for SADC to achieve on the hierarchical stage is a customs union (CU). A CU supposes to permeate intra-regional borders in terms of its influence. This implies the removal of tariffs when member states trade with one another. So far, even within the Southern African Customs Union (SACU), there is grappling on arriving at a revised and developmental income sharing formula. SACU, which was established in 1910, has enough experience which should be shared with the broader SADC region. However, an absence of a roadmap for SACU continues to deny it the leadership role in the region. This leaves SADC to continue with business as usual. Unlike SACU, SADC has a multiple agenda that makes it lose focus of its core element of integration, namely economic integration. The more multi-faceted a regional grouping becomes, the more costly running its programmes will be. Many of these facets which SADC requires to advance have relied heavily on external donor funds and this at times compromises expected outcomes. With regards to developing economically lagging member states, the norm has been to lure investors on the basis of individualistic attractions. This approach should be revisited if economic integration and development are to be scaled upwards.
An effective approach is one that will engender shoring up those states with investment opportunities that seek to settle in the region. This suggests departing from the tradition of agglomeration, holding all other things constant. For example, those well to do in the areas of tourism should be supported with needed infrastructural needs. Going it this way may strategically offer benefits that are futuristic for the region at large when SADC finally becomes a CU.
When enforced, a wider regional vision will spur needed economic development across member states in a CU. All other things equal, at a CU level, a united SADC will have a better negotiation position on trade related platforms. Although debatable, the current state of affair shows an incongruent path to economic integration. Another interesting aspect is on why a CU should be delayed in SADC? One wonders whether or not the regional grouping has deeply interrogated and disentangled how a co-existence of two CUs, which are SACU and SADC CU, will occur. From a trade policy perspective, the existence of two CUs in one region is not practical.
Therefore, attempts to elevate SADC from a Free Trade Area to a CU will directly undermine SACU. Whether this is what SADC member states want or not, it is an issue that is inevitable for discussion. Since the purpose for rising to a CU is purely economic, trade integration will have to take center-stage and as such a democratic and stable region will need to be born. For now, in SADC there are pockets of instability which needs to be resolved for an improved economically sound environment. When carried into the SADC CU, politically unstable member states may only serve to free-ride on economic outcomes that accrues to the grouping. This issue may be what some member countries are silently concerned with.