SA seeking bigger slice of customs union cake

The government is pushing for a bigger slice of the customs and excise revenue generated by the Southern African Customs Union (Sacu), but is facing a wall of resistance from its neighbours, says a Business Day report. Finance Minister Nhlanhla Nene and Trade & Industry Minister Rob Davies briefed the Finance and Trade and Industry Committees last week about restructuring the revenue-sharing formula which sees the lion’s share of revenue going to SA’s neighbours and could release badly needed funds to meet the country’s dire fiscal challenges. The committees resolved to support their stance and to submit their decision to the National Assembly for endorsement. This will strengthen the position of SA’s negotiators during the talks, notes the report. Nene told MPs that very little progress has been made in discussions to review the revenue-sharing formula despite intense engagements. The major difficulty was the underlying principle of the negotiations, which was that no one should be made worse off by any agreement. This meant no one should be better off either. ‘A review which will see us being put on a better footing will be very difficult to arrive at,’ Nene said. SA contributed about R30.3bn (98.3%) of the Sacu revenue pool annually on average between 2007-08 and 2016-17 but took out R26.4bn (45.8%) while Botswana, Eswatini, Lesotho and Namibia contributed R510m (1.7%) but took out R31bn (54.2%).