Assessing the role of co-ordinated border management as trade facilitation instrument in selected SADC countries

Abstract

Africa's non-competitive trade and consequential socioeconomic problems have long been a topic for research and investigation. The Southern African Development Community (SADC) is a textbook illustration of this economic dilemma. Many researchers and organisations, such as the World Trade Organization (WTO), regard trade facilitation in the form of faster customs and border procedures as the solution. To determine the role of customs and border procedures in regional trade, we examined the potential effect of faster export times in the region with the construction of a Global Trade Analysis Project (GTAP) model. Following this analysis, the proficiency of co-ordinated border management (CBM) as a possible trade facilitation instrument was investigated, by sourcing and analysing transaction-level data at a specific South African border post. Finally, we presented the current regulatory position on customs and border procedures in the SADC region. The result of the GTAP analysis in the first study indicated that a 50% improvement in export times will influence the gross domestic product positively in many respects; with a total welfare gain estimated at around US$28.6 billion for the region. Almost all sectors will experience a positive effect and export markets can become more diverse, which are essential elements for successful global trade. The second study illustrated that CBM, as a possible trade facilitation instrument, has the potential to expedite border clearance times to the levels required to achieve the aforesaid results. Lastly, considering the South African Customs Control Act (31 of 2014) as an example of the most recent legislation in the region, offered the insight that SADC members are adhering to global calls of the customs community to acknowledge trade facilitation in their national legislation, indicating vital political support. These results demonstrate that faster border clearance times can have a significant impact on prosperity in the SADC region and that some components to achieve success are already being considered, organised and implemented in the region. Better co-ordination between neighbouring countries, specifically in border procedures, can help to achieve better regional trade performance.