Gaborone: Botswana has received over P5.1 billion (R5.6 billion) as its annual Southern African Customs Union (SACU) revenue share. Minister of Finance and Development Planning, Mr Kenneth Matambo, said the money will be used to finance the 2010 national budget. He said the amount is smaller than in previous years because of the global economic downturn.
However, he said it is important in respect of both the development and the recurrent budget. Mr Matambo blamed the decline in the revenue share to reduction of imports.
Mr Matambo added that Botswana has agreed with the formula used to divide the tax revenue among the member states but the amount is insufficient to support the 2010/2011 national budgets of the individual countries.
Mr Matambo explained that prior to the division of the revenue share, South Africa proposed a review of the formula used to divide the revenue and all the member states accepted the proposal. Therefore a task team will be instituted with a view to identify the areas where there is need for review.
Mr Matambo said that in practice, duties are collected by all member states and transferred to the common revenue pool on a quarterly basis and then revenue shares are determined by the Council of Ministers and payouts to member states are made on a quarterly basis.
The SACU revenue formula shows that the country with the biggest economy gets the biggest share when the revenue is distributed and that country in this particular case is South Africa followed by Botswana, Namibia, Lesotho and Swaziland.
He stated that allegations that have been doing the rounds in various media circles indicating that South Africa wants to pull out of the union are far from the truth because South Africa has not mentioned anything like that to the member states and instead the union has agreed on medium and long term issues.
Mr Matambo said SACU recently discussed common industrial policies for the benefit of the member states not only South Africa. He added that all along South Africa retained the sole decision-making power over customs and excise policies.
He stated that it also retained an open access to the Botswana, Namibia, Lesotho and Swaziland markets, while the high common tariff raised barriers for Southern African neighbors exports to SACU and these trade-diverting effects benefited the South African manufacturers.
He said that SACUs main objective is to facilitate the cross-border movement of goods between the territories of the member states, to promote conditions of fair competition in the common customs area.
This will substantially increase investment opportunities in the common customs area as well as to enhance the economic development, diversification, industrialization and competitiveness of the member states. BOPA
