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WTO voices concern over high tariffs in Sacu states

Business Day, Johannesburg

WTO voices concern over high tariffs in Sacu states

By Charlotte Mathews

10 November 2009

Members of the World Trade Organisation’s (WTO’s) trade policy review committee raised its concern last week over the relatively extensive use of antidumping and other tariff measures by SA on behalf of the Southern African Customs Union (Sacu).

Dr Malan Lindeque, Namibia’s trade and industry permanent secretary, who led the Sacu delegation, said Sacu’s use of antidumping measures had declined since 2006 and Sacu countries were no longer the biggest users of defensive trade instruments in the world.

Sacu is a 100-year-old customs union comprising SA, Botswana, Lesotho, Swaziland and Nambia. It has been implementing new practices in the past five years to try to spread development in the region and adapt to global trends towards greater regional integration.

This was the WTO’s third review of Sacu for transparency and WTO compliance after previous assessments in 1998 and 2003. It was concluded in Geneva on Friday.

In his closing statement after the review, Dr Istvan Major, Hungary’s ambassador in Geneva and committee chairman , praised Sacu members for their positive economic performance, largely due to their reform efforts. Committee members had commended Sacu for its commitment to multilateral trade, he said, but were concerned about the complexity arising from overlapping trade agreements in the region.

Sacu’s trade liberalisation efforts, where its common external tariff was simplified and cut to 8,1% this year from 11,4% in 2002, were also recognised, but there was some concern about areas in which tariff rates exceeded WTO levels.

The committee urged Sacu countries to move ahead on product and market diversification, since countries other than SA had very narrow export bases, like Botswana and Namibia in their dependency on diamond revenue .

Lindeque said Sacu countries had achieved a growth rate of 4% a year since 2002. During the economic crisis, there had been an increase in trade among Sacu states, showing Sacu had provided some protection against external shocks.

Major urged Sacu countries to improve multilateral commitments and pursue reforms to enhance the transparency, predictability and credibility of their trade regimes.

“Trading partners can help by ensuring that their markets are fully open, and by providing appropriate technical assistance to Sacu countries,” he said.