The Southern African Customs Union (Sacu) Is an Example of What Type of an Agreement
The Southern African Customs Union (SACU) has been an essential agreement among African nations for decades. It is a crucial agreement that has provided support for several countries in the region, strengthening their economies and helping them to compete on a global scale.
The SACU is a customs union agreement designed to streamline trade among member countries. It was established in 1910 and has five member countries, including Botswana, Namibia, Swaziland, Lesotho and South Africa. The agreement has been revised over the years to meet the ever-changing economic landscape in Africa and the world at large.
The SACU is an example of a bilateral trade agreement. Bilateral trade agreements are signed between two countries, and they aim to increase trade and investment between the countries. In this case, the SACU agreement is between five member countries, but the principle remains the same.
The central goal of the SACU agreement is to harmonize trade policies among its member countries. It aims to eliminate tariffs on goods traded among member countries, thereby reducing the costs associated with trade. This reduction in costs can lead to increased trade, which can benefit the economies of member countries.
Another key feature of the SACU agreement is the common external tariff (CET). The CET is a tariff imposed on goods imported into the SACU from countries outside of the agreement. This policy is designed to protect the local industries of member countries from external competition.
In conclusion, the Southern African Customs Union (SACU) is a critical agreement designed to streamline trade and investment among its member countries. It is an example of a bilateral trade agreement and has been in existence since 1910. With its focus on harmonizing trade policies, eliminating tariffs, and protecting local industries, the SACU has remained an essential agreement in the region and beyond.