Downgrading SACU could have economic costs

It is an open secret that tensions are running high within the customs union, which is not only the oldest such formation in the world, but which is also commemorating its hundredth anniversary this year.

These internal strains came into sharp relief last year when Botswana, Lesotho and Swaziland signed the controversial Interim Economic Partnership Agreement (EPA) with the European Union (EU), while South Africa and Namibia refused to do so. In fact, during his April 22 address on the occasion of the commemoration of the Sacu centenary, in Windhoek, Namibia, President Jacob Zuma cautioned that "if we cannot pursue the unfinished business of the EPA negotiations as a united group, the future of Sacu is undoubtedly in question". But apart from disagreements over Sacu's extraregional strategy and vision, there is also unhappiness over the revenue-sharing formula - hitherto, the glue that has held Sacu together, even during the difficult apartheid years.