By Ronald Imbayago This is a second in a four-part series on post-apartheid Southern Africa
As southern Africa moves toward fundamental political, social and economic change — and the incorporation of the new democratic South Africa into the Southern African Development Community (SADC) — a boost in regional integration and stimulation of trade and investment is expected.
South Africa was formally accepted as the eleventh SADC member at the annual summit in Gaborone, Botswana, on 29 August. Since this development, analysts in the region are debating South Africa’s economic role in transforming SADC. Some say its membership in SADC will be based on equality, but others argue that it will assume a leadership role.
Zimbabwean President, Robert Mugabe, says greater co-operation is expected in telecommunications, hydro-electric power, agriculture and transport. For regional integration to take place, there is need to lift trade barriers to allow free flow of goods among SADC countries.
There should be free flow of capital and peoples of the region. Greater labour mobility would be made possible by increased economic co-operation in the region. Currently, there are thousands of migrant workers in South Africa from neighbouring countries, most of whom are employed in that country’s gold-mines. Because of the size of South Africa’s economy and finances, its sophisticated infrastructure, developed agricultural, manufacturing and mining sectors, the country is regarded by many as an engine for change in Africa.
SADC’s executive secretary, Kaire Mbuende, says the emergence of a democratic South Africa allows the community to explore regional economic integration, which largely depends on political and military stability. He says SADC aims to achieve economic co-operation and integration based on balance, equity and mutual benefit, and many people believe it is now possible due to the encouraging political scenario in the region.
South Africa’s Deputy Minister of Foreign Affairs, Aziz Pahad, says regional economic co-operation is a priority for his government, but it must be based on an equal partnership. A co-ordinated approach to source international assistance for development programmes will have to be worked out and integrated into an overall economic strategy for regional growth.
It should be borne in mind that rapid economic growth in South Africa will subsequently underpin the success of any regional co-operation agreements. But the expectation of rapid regional economic recovery and integration needs to be viewed more realistically.
All countries in the region should have a fair share of opportunities for investment, production, trade and employment creation.
The current economic disparities between South Africa and other SADC countries pose a danger. A Botswana economist fears that integration may widen the anomalies unless both sides take corrective measures to prevent it. There is a also fear that South Africa could dominate trade in the region because of its strong industrial background, hence investors could abandon other regional countries and rush there.
Its economy is estimated at three times larger than that of all SADC countries combined. In 1990 alone, South Africa exported goods valued at R12.5 billion to SADC countries but imported only R2.5 billion worth of goods from them. In other words, South Africa exported six times as much as it imported from its neighbours. According to the monthly Southern African Economist of July 1994, the severe imbalance in trade between South Africa and the region is expressed by a ratio of 5:1 in favour of South Africa.
Trade figures for 1993 showed a trade balance of R3.9 billion in South Africa’s favour out of a total trade of R5.8 billion with Southern Africa. An official from the Economic Affairs ministry says his country has an interest in regional co-operation as its economic viability depends on the viability of other southern African states.
South Africa’s Deputy President, Thabo Mbeki, who signed the SADC Treaty on behalf of President Nelson Mandela, committed his country to contribute to the region’s development through SADC. He said South Africa’s membership should help redress current imbalances in trade in the region. The current balance of trade is in favour of South Africa.
Abdul Rahman Babu, a former Tanzanian Minister of Economic Affairs and Development Planning, says before South Africa can think of playing a decisive role in Africa, it must first make its economy truly South African. He argues that South Africa’s economy is an extension of Western economies in Africa.
Incorporating such an economy in regional trade arrangements such as SADC, says Babu, will worsen the economies of other countries in the region as trade benefits always favour the strong at the expense of the weak. He says to make its economy national, South Africa has to involve the majority of its people, especially those living in the townships.
Before South Africa contributes to the regional economy, says Babu, it has to rebuild its own economy slowed down by decades of apartheid. (SARDC)
