20 March 2019

Southern Africa: SADC to Set Up Development Fund

The SADC region is working on programmes of industrial development and market integration, infrastructure, peace and security and special programmes with a regional dimension.

This was said by the deputy executive secretary for regional integration, Thembinkosi Mhlongo, during the just-ended council of ministers meeting in Windhoek.

The seven-day meeting whose theme was 'Coordination of Development Programmes to Maximise Employment Creation and Productivity' discussed various issues, among them industrialisation.

Mhlongo told a media briefing that the regional body had proposed setting up a regional development fund, and to look for other opportunities to raise funds.

Under these programmes, there will be a number of activities, including those in transport, energy and information communication and technology.

He said the ministers proposed to utilise opportunities linked to the continental level, such as raising additional financial resources through a levy on extra regional imports, or those that come from countries outside SADC.

The proposal also included using other levies that member states agree on, such as transport and financial services levies for the region to fund its programmes rather than rely on donors.

"At the moment, we rely on donors, and our projects are not moving fast because we have to go and ask all the time," Mhlongo added.

The budget presented by SADC executive secretary Stergomena Lawrence Tax at the opening of the ministers' meeting on Friday showed that allocations for regional dimension programmes had decreased from 48% in 2015/16 to 35% in the 2018/19 financial year.

Budgets for industrial development, market integration and infrastructure increased from 38% in 2015/16 to 48% in 2018/19, while allocations for peace and security increased from 14% to 17% during the same period.

Tax said the analysis of the budget shows improvements in aligning budget allocations to the SADC resources allocation framework.

"The secretariat will continue to ensure that the resources allocation framework is adhered to, and that the available resources are allocated in line with SADC priorities, and will be utilised prudently," she continued.

Tax further stated that progress towards regional economic integration remains mixed, after experiencing robust economic growth prior to the global financial and economic crisis of 2008/09 that slowed it down, thus compromising macroeconomic convergence.

As a result, the region remains with a huge difference in terms of income, of which about half of the members reported GDP of below US$1 000, she added.

"The structures of the economies of the region remain undiversified, with a growing resource-based and stagnant manufacturing sector. In addition, the goods market in the region remains small," Tax continued.

Furthermore, there is a need to strengthen the implementation of the SADC industrialisation strategy and roadmap, which can be done by ensuring that all intervention pillars aimed at accelerating economic growth are implemented in a synergetic manner.

Tax further said the secretariat, in collaboration with member states and the youth, carried out a number of activities since the summit in August last year, which include training youth in fisheries and aquaculture, held in Lilongwe, Malawi, in September, and the Southern Africa internet governance forum hosted in Durban, South Africa, in November.

"These offered the youth an opportunity to discuss technological themes such as fostering incubator activities for the disadvantaged groups in the digital economy, and the regional fisheries and aquaculture sectors," she noted.

The secretariat will continue to ensure broad-based participation of the youth in socio-economic development processes, as part of the regional integration agenda, Tax said.

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