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MBABANE – Eswatini and its fellow SACU member States are said to be losing at least E7 billion in customs revenue every month due to the COVID-19 pandemic.

SACU is the Southern African Customs Union (SACU) made up of five countries in Southern Africa. These countries are Eswatini, Botswana, Lesotho, Namibia and South Africa. All customs and excise collected in the common customs area are paid into South Africa’s National Revenue Fund.


The revenue is shared among members according to a revenue-sharing formula, as described in the agreement. South Africa is the custodian of this pool.
The member countries have relied on the bloc, which brings in between E88 billion to South Africa down to E8 billion for the country (Eswatini).

SACU Executive Secretary Paulina Elago was quoted by EyeWitness News saying that closed borders had cut trade in some countries to only one per cent of normal flows.
In 2018, the five SACU member States exported goods worth R1.39 trillion, equating to E115 billion per month.

Out of the E1.5 trillion in imports, they generated customs and excise revenues of E90 billion.
Last year, they shared E120 billion with South Africa receiving E87.7 billion, followed by Botswana with E23.7 billion, Namibia E22.3 billion. Lesotho and Eswatini got E8.9 billion and E8.3 billion, respectively.
For the country, that is 12 per cent of gross domestic product.


But due to closed borders, the Botswana Unified Revenue Service is currently processing less than one per cent of the usual cross-border trade volumes while the country is said to have recorded a decline of up to 70 per cent.
At that rate, which means that of the estimated E10 billion that SACU would have generated in a month, anything between E7 billion and E9.9 billion is already lost.

SACU’s Elago said that it was difficult to quantify the impact now but it would be unprecedented.
Based on the current situation, it means the country’s target will not be met.
Minister of Finance Neal Rijkenberg, when presenting budget estimates in February this year, had said SACU receipts were expected to soar to E8.34 billion.

Experts told this publication that it would be a disastrous year regarding the collection of revenue following the reduced economic activity. They felt the country’s endurance would be put to the test.
“With borders closed, other forms of generating income internally like issuing of passports have been derailed,” shared another expert.

On May Day (last Friday) Prime Minister Ambrose Dlamini announced that there was a Cabinet sub-committee to develop an economic recovery plan.
“The foundation of this plan is both the National Development Plan and the Strategic Roadmap. The Cabinet sub-committee will engage key stakeholders in the development of this plan,” announced the premier.


On another note, the country’s businesses importing farming inputs, especially fertiliser, can breathe a sigh of relief, as South Africa’s Minister of Agriculture, Forestry and Fisheries Thoko Didiza announced that export of agriculture products would be allowed from last Friday.

The neighbouring country downgraded to level four of the lockdown on May 1. Some industries are now allowed to operate.
Some local outlets were reportedly running out of farming inputs, especially fertiliser and needed to import from South Africa, which was on full lockdown.

According to Didiza, the export of wool and other synthetic products will be allowed at level four.
“Retail shops providing agricultural inputs may operate and auctions may take place, but under strict conditions to adhere to the prevention of health risks,” said Didiza.
In the country, on the other hand, public auctions, including that of animals, remain frozen.

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