The suitability of a stabilisation fund for SACU

Image: Getty, GovernmentZA
Image: Getty, GovernmentZA

The most recent – 2002 – Southern African Customs Union (SACU) Agreement revised the customs and excise revenue sharing formula for SACU member states.

Since this revision, some SACU member states have seen significant volatility in their receipt of revenues from the SACU revenue pool. Given this, one of the focus areas of SACU’s work programme is the establishment of a regional SACU stabilisation fund, primarily to counter volatility in the common SACU revenue pool. This policy briefing summarises the rationale for and feasibility of such a fund in SACU. A review of existing stabilisation funds finds no evidence of one established at a regional level. This may be because, at the very least, individual country participants would need to agree to a set of common regional fund deposit and withdrawal rules, which would impact their own revenue and expenditure dynamics. For SACU, the establishment of a regional stabilisation fund is premised on the common SACU revenue pool being the root cause of the revenue unpredictability and volatility

16 Jul 2018

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Research by
GEG Africa
Sub-Saharan Africa
SAIIA Programme
Economic Diplomacy
Southern African Customs Union (SACU)
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