SACU REJECTS SHARING FORMULA STUDY

His Majesty the King (C) posing for a group photo with SACU delegates representing member States at the Mandvulo Grand Hall entrance. (Pics: Bonisile Makhubu)

LOZITHA – The Southern African Customs Union ‘threw out’ a study, that would have made Swaziland lose out on a large chunk from the Union, whose dividends finance over 30 per cent of the country’s national budget.
The national budget stands at over E21 billion.

The Southern African Customs Union (SACU), the oldest customs union in the world, had undertaken a process of reviewing the revenue sharing formula of monies collected as customs duties and injected into the common revenue pool and then shared among the five member States; Swaziland, South Africa, Lesotho, Namibia and Botswana.  

SACU Council of Ministers Chairman Martin Dlamini, speaking during a media briefing convened at the end of the Fifth SACU Heads of State Summit convened at Mandvulo Hall yesterday, explained that member States had once again decided to undertake a study that would inform a review of the revenue sharing formula. 

Acknowledged

The Summit was attended by South African President Jacob, Botswana Vice-President Mokgweetsi Masisi, and Namibia Finance Minister Carl-Hermann Schlettwein.
The minister acknowledged that it had taken a while to review the sharing formula. He said this was primarily because the intention was to ensure that all members were at ease with the proposed sharing formula. 

At the Summit, Heads of State mutually agreed that a new study ought to be undertaken after the initial study which would have seen smaller countries taking home a smaller slice of the pie was recommended for review.
“It is true that processes to review the SACU revenue sharing formula have taken a while.

Unearthed

‘‘It has been agreed by Member States that a new study be undertaken after it was unearthed that the previous study, which was to inform the sharing formula would make some states worse off,” said Dlamini.
The minister pointed out that they were confident that the revised sharing formula would be more considerate of the interests of all five member states who are part of SACU.
He said this was evident from the fact that committees that would effectively work towards collating a new study had already been appointed.    

SACU Executive Secretary, Paulina Elago emphasised with the ongoing review of the sharing formula, improvement of economies of all member states would be key.

Economies

“The intended review of the SACU revenue sharing formula should not make SACU member state worse off. The purpose of the review is to improve the economies of all members,” Elago assured.
Effectively, the undertaking means Swaziland, which heavily relies on SACU dividends to finance the budget, would not be under pressure, at least until the final version of the new sharing formula gets adopted.
However, His Majesty King Mswati III has strongly emphasised on the need to diversify the economy to reduce heavy reliance on the SACU share.  

Summit

Explaining when the revised formula could be completed, Elago said the SACU work programme adopted at the summit was expected to complete within the next 24 months. 
During the Summit, Heads of State noted and endorsed a work programme, based on the outcomes of the third ministerial retreat, which outlines detailed activities, key deliverables and the timelines within which the proposed activities would be undertaken.

Post your comment

Your name:

Your e-mail address:

Add your comments:

Please enter the code you see in the image:

Image:

Code: