Southern African Customs Union

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States of SACU

The Southern African Customs Union (SACU) is a customs union among the countries of Southern Africa.

1 History
2 Membership
3 Functions and organization
4 Latest developments and structure
5 Comparison with other Regional blocs
6 References
7 See also
8 External links

[edit] History

SACU is the oldest customs union in the world.^[1] It was established in 1910 as a Customs Union Agreement between the then Union of South Africa and the High Commission Territories of Bechuanaland, Basutoland and Swaziland. With the advent of independence for these territories, the agreement was updated and on December 11, 1969 it was relaunched as the SACU with the signing of an agreement between the Republic of South Africa, Botswana, Lesotho and Swaziland. The updated union officially entered into force on March 1, 1970. After Namibia's independence from South Africa in 1990, it joined SACU as its fifth member.

[edit] Membership

SACU currently has five members:

[edit] Functions and organization

The union meets annually to discuss matters related to the Agreement. There are also technical liaison committees, namely the Customs Technical Liaison Committee, the Trade and Industry Liaison committee and the Ad hoc Sub-Committee on Agriculture, which meet three times a year.

Its aim is to maintain the free interchange of goods between member countries. It provides for a common external tariff and a common excise tariff to this common customs area. All customs and excise collected in the common customs area are paid into South Africa’ national Revenue Fund. The Revenue is shared among members according to a revenue-sharing formula as described in the agreement. South Africa is the custodian of this pool. Only the BLNS Member States' shares are calculated with South Africa receiving the residual. SACU revenue constitutes a substantial share of the state revenue of the BLNS countries.

[edit] Latest developments and structure

Following the formation of the Government of National Unity in South Africa in April 1994, Member States concurred that the present Agreement should be renegotiated in order to democratise SACU and address the current needs of the SACU Member States more effectively.

With this in mind, the Ministers of Trade and Industry of the five member states met in Pretoria on November 11, 1994 to discuss the renegotiation of the 1969 agreement. The Ministers appointed a Customs Union Task Team (CUTT) which was mandated to make recommendations to the Ministers. CUTT has met on numerous occasions in the various Members States and good progress has been made in the renegotiation process.

At a meeting of Ministers of Trade and Finance Departments from the five SACU Member States, held in Centurion, Pretoria on September 5, 2000, the Ministers reached consensus on the principles of underpinning the Institutional reform in the SACU.

The Administrative Institutional structure of the revenue pool that was discussed was agreed to consist of the following:

Council of Ministers: A body represented by one Minister from each SACU member state. It would be the supreme SACU decision-making body and would meet on quarterly basis. The decisions taken by this Council would only be by consensus.

Commission: Administrative body comprised of Senior Officials, three Technical Liaison Committees and an established Agricultural Liaison Committee.

Tribunal: An independent body of experts. It would report directly to the Council of Ministers. The tribunal would be responsible for tariff-setting and the Anti-dumping Mechanism.

Secretariat: Responsible for day to day operations of the pool. It would also be funded from the revenue pool. Its location would be determined by Senior Officials who were directed to meet after a period of a month to develop proposals for the implementation of the revised SACU Institutional Structure.

SACU Ministers further agreed that the revenue share accruing to each Member State should be calculated from three basic components:

a share of the customs pool;
a share of the excise pool; and
a share of a development component

Further, it was agreed that these three different components would be distributed as follows: The customs component should be allocated according to each country’s share of total intra-SACU trade, including re-exports.

The excise component, net of the development component, should be allocated on the basis of GDP. The development component should be fixed at 15% of the total excise pool and distributed to all SACU members according to the inverse of each country’s GDP/capita.

By late 2004 SACU was negotiating a Free Trade deal with the United States. A Free Trade deal is scheduled to be signed between it and EFTA in November 2005 and to become active in the beginning of 2006.

[edit] Comparison with other Regional blocs

**Most active regional blocs**
Regional bloc ¹	Area (km²)	Population	GDP (PPP) ($US)		Member states ¹
Regional bloc ¹	Area (km²)	Population	in millions	per capita	Member states ¹
EU	4,325,675	496,198,605	12,025,415	24,235	27
SAARC	5,136,740	1,467,255,669	4,074,031	2,777	8
CSN	17,339,153	370,158,470	2,868,430	7,749	10
ASEAN	4,400,000	553,900,000	2,172,000	4,044	10
NAFTA	21,588,638	430,495,039	15,279,000	35,491	3
EurAsEC	20,789,100	208,067,618	1,689,137	8,118	6
ECOWAS	5,112,903	251,646,263	342,519	1,361	15
SACU	2,693,418	51,055,878	541,433	10,605	5
GCC	2,285,844	35,869,438	536,223	14,949	6
COMESA	3,779,427	118,950,321	141,962	1,193	5
Agadir	1,703,910	126,066,286	513,674	4,075	4
CEMAC	3,020,142	34,970,529	85,136	2,435	6
CARICOM	462,344	14,565,083	64,219	4,409	14+1 ³
EAC	1,763,777	97,865,428	104,239	1,065	3
CACM	422,614	37,816,598	159,536	4,219	5
PARTA	528,151	7,810,905	23,074	2,954	12+2 ³
EFTA	529,600	12,233,467	471,547	38,546	4
Reference blocs and countries ²	Area (km²)	Population	GDP (PPP) ($US)		Political divisions
Reference blocs and countries ²	Area (km²)	Population	in millions	per capita	Political divisions
UN	133,178,011	6,411,682,270	55,167,630	8,604	192
Germany	357,050	82,438,000	2,585,000	31,400	16
Japan	377,873	128,085,000	4,220,000	33,100	47
Canada	9,984,670	32,507,874	1,165,000	35,200	13
Indonesia	1,904,569	234,300,000	935,000	4,000	33
Brazil	8,514,877	187,560,000	1,616,000	8,600	27
Russia	17,075,200	143,782,338	1,723,000	12,100	89
India	3,287,590	1,102,600,000	4,042,000	3,700	35
China (PRC) ⁴	9,596,960	1,306,847,624	10,000,000	7,600	33
USA	9,631,418	300,000,000	12,980,000	43,500	50
¹ Including data only for full and most active members ² The first five states in the World by area, population and GDP (PPP) ³ Including non-sovereign autonomous entities of other states ⁴ Data for the People's Republic of China does not include Hong Kong, Macau and regions administered by the Republic of China (Taiwan). smallest value among the blocs compared largest value among the blocs compared During 2004. Source: CIA World Factbook 2005, IMF WEO Database This box: view • talk • edit