Mathabo Le Roux
10 December 2007
Johannesburg — A SPLIT between members of the Southern African Customs Union (Sacu) over the negotiation of economic partnership agreements (EPAs) with the European Union (EU) has thrown the world's oldest customs union into crisis. Observers now fear that its very existence could be at stake.
The trade deals with Europe are set to replace the existing Cotonou agreement which governs African countries' trade with the EU.
Sacu countries are negotiating EPAs as part of the Southern African Development Community (SADC) bloc, which also includes Angola and Mozambique. While Botswana, Lesotho, Mozambique and Swaziland have initialled an interim agreement, Namibia and SA have opted out, arguing the EU's demands are too onerous.
The two countries are particularly riled by a demand for most-favoured nation (MFN) treatment, which would see concessions made to other countries in future free trade agreements automatically extended to the EU, and the European Commission's insistence on negotiating new generation issues. They also balked at the commission's request to eliminate export taxes.
SA and Namibia, in separate statements last week, protested that the deal would limit countries' policy space and undermine their industrialisation drive. Ultimately, the demands posed a threat to the region's regional integration programme, they said.
Weekend attempts at the EU-Africa Summit in Lisbon to break the stalemate proved futile. Bloomberg reported that African Union commission chairman Alpha Oumar Konare urged members not to sign the EPAs as they could come at a tremendous cost to African industry.
"The divisions between SA and its neighbours raise some very serious questions about Sacu's effective operation," said trade lawyer Hilton Zunckel. But of greater concern was the future continuation of Sacu as a coherent entity. The divided actions by the Sacu member states "clearly breach the substance of the Sacu treaty", he said.
Article 31 of the 2002 Sacu agreement prohibits member states from entering into new trade pacts, or amending existing agreements, without the consent of other member states.
But Trudi Hartzenberg, executive director of the Trade Law Centre for Southern Africa, said the argument that Lesotho, Botswana and Swaziland should have refrained from initialling the EPA "just does not fly" because there had been de facto concurrence on the negotiation of the EPA.
She criticised SA for stalling the crucial process and not taking its regional obligations seriously.
"What we really need is a regional strategy and SA is the anchor economy, so it should factor in the needs of the region. SA must come clean on the role it sees for itself," Hartzenberg said.
But Zunckel faulted the EU for dividing the region.
"The fact that Botswana, Lesotho and Swaziland have signed up without Namibia and SA is evidence of a carefully crafted and effective divide and rule strategy by the EU negotiators, probably leveraged by promises of future aid under the European Development Fund. But are they (Lesotho, Botswana and Swaziland) assessing how much they will gain from these funds or what they stand to lose if Sacu split up? The EU is jeopardising the Sacu that could be," he said.
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