Region must prepare to cushion the economy, says Botswana’s Masisi at Sacu summit

The seventh Southern African Customs Union (Sacu) summit has been held to deliberate and reflect on the impact of the Russia-Ukraine conflict and the Covid-19 pandemic.

“The summit noted the important deals that were concluded at the 12th World Trade Organisation ministerial conference. These include an agreement that enables the production and supply of Covid-19 vaccine without the patent holders’ authorisation,” Sacu said.

President Cyril Ramaphosa attended the summit held in Gaborone, Botswana. Member states in attendance included host nation Botswana, Swaziland, Lesotho, SA and Namibia.

“The [summit also noted] discipline on unregulated and unreported fishing that will protect the waters of the Sacu countries. It also noted the food security measures to mitigate against increase in food prices and food shortages.

“The e-commerce work programme aimed at setting a deadline for the moratorium on customs duty to secure support for digital industrialisation for Sacu and other African countries, as well as the WTO reforms that provide an opportunity to put forward additional policy space to promote African industrialisation.”

Sacu meets annually to discuss progress on implementation of its agreed work programme. The seventh summit considered progress made on implementation of the refocused work-programme priorities. These include:

• industrialisation through development of regional value chains;
• investment attraction and export promotion;
• regional financing mechanisms, trade facilitation and logistics; and
• implementation of the African Continental Free Trade Area.

In his opening remarks the summit chair, Botswana President Mokgweetsi Masisi, said the meeting was aimed at providing political and strategic solutions to issues affecting Sacu.

“We are meeting in the midst of social, economic and geopolitical challenges at the global level. As such, it is critical we reflect on these developments as they impact us in different ways at geopolitical and regional levels,” he said.

Masisi said countries were still reeling from the Covid-19 pandemic. “In the efforts aimed at reviving our economies, of critical importance is how we also can make our economies more resilient when faced with the prospect of similar crises in the future.”

Stronger regulatory and administrative collaboration, he said, could help respond in a co-ordinated manner to facilitate the seamless movement of goods within the common customs area.

“It is only through mutual partnerships that our people and traders can derive the maximum benefit from what Sacu aims to achieve.”

On economic development, Masisi said in January 2022 there was optimism that the global economy would continue on a positive trajectory. “However, with the ongoing Russia-Ukraine conflict, growth prospects have been dimmed and growth is estimated to slow down to 3.6% in 2022.”

The conflict worsened the already depressed economy as a result of the pandemic, said Masisi. “For the Sacu region, the overall weighted growth is estimated to have contracted by 6.5% in 2020. Growth is estimated at 4.9% in 2021 and will decline in 2022.”

Masisi said measures must be taken to cushion the economy.

Closing the summit, Masisi said the discussions were frank and cordial.

“The seventh summit considered the report of the Sacu council of ministers on the refocused work programme, which formed the basis of the adoptive strategic plan for Sacu for the period of 2022-2027.”

The strategy focuses on industrialisation through the development of regional value chains, investment attraction and export promotion, industrialisation, trade facilitation and logistics, as well as the implementation of the African Free Trade Agreement Area.

“I am pleased to note that Sacu’s visibility as an economic vehicle for industrialisation has been enhanced,” he said.

Masisi congratulated King Mswati III, the incoming Sacu chair.

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