‘Time for SA to end subsidisation of Swaziland and Lesotho’

SA should keep its fair share of customs duties and in the face of mounting domestic needs should stop using SA Customs Union receipts to subsidise Swaziland and Lesotho, a leading economist has told FTW. Dr Mzukisi Qobo, head of the Emerging Powers Programme and Global Challenges at the South African Institute of International Affairs (SAIIA) in Johannesburg, supports a position of “charity begins at home” when it comes to the disproportionate customs revenues given to Botswana, Lesotho, Namibia and Swaziland, which he said was really “foreign aid in disguise.” Mincing no words that Swaziland and Lesotho in particular are failed states economically whose dependency on SA makes doubtful their claims to national sovereignty, Dr Qobo said SA didn’t even get much out of the bargain. “It is not as if by pumping these resources South Africa is allowed to exercise leadership and determine the regional trade strategy. This is clearly a case of distorted relationships,” he said. In a recent presentation on Sacu at Wits University, Dr Qobo said: “From a benefitcreation point of view, it would be extremely hard to justify why South Africa continues to expend massive financial resources on building an ailing customs union arrangement, while social stability (in SA) is on the verge of implosion. The more pressing question for South Africa is how to reconcile these massive transfers with deep-seated socio-economic challenges within the country. “There are as many poor people in South Africa as there are in the BLNS (Botswana, Lesotho, Namibia and Swaziland) countries combined. The rising cauldron of discontent in (SA’s poor communities) bears testimony to this, and it will get worse. Do these communities know that a significant portion of the fiscus – which could have gone towards building houses, better schools and road infrastructure – migrates to pay for public servants, prop up the royal household in Swaziland, and maintain the lifestyle of elites in the BLNS countries?” Dr Qobo’s solution is for Swaziland and Lesotho to face reality and seek integration into SA by acquiring provincial status, a state that economically at least some other economists say already exists.