Lesotho hosted the Southern African Development Community (SADC) 26th Summit of the Heads of State and Government from 16 to 18 August 2006. Regional economic integration was the highlight of the meeting. It was not surprising therefore that key discussions revolved around the Trade Protocol.

The meeting endorsed an ambitious plan that aims to establish a Free Trade Area by 2008, customs union by 2010, a common market by 2015, monetary union by 2016 and a single currency by 2018.
SADC groups Angola, Botswana, the Democratic Republic of Congo, Lesotho, Madagascar, Malawi, Mauritius, Mozambique, Namibia, South Africa, Swaziland, Tanzania, Zambia and Zimbabwe. One sensitive issue that continues to trouble SADC is the issue of membership to other regional blocks. This is more so as WTO regulations forbid countries from belonging to more than one customs union. All SADC countries except Mozambique have multiple memberships. Some members of the East African Community, the Common market for Eastern and Southern Africa, the Economic Community of Central African States and the Indian Ocean Commission are also part of the SADC. For example, South Africa, Botswana, Lesotho, Swaziland and Namibia besides being SADC members are also members of the Southern African Customs Union (SACU). This inevitable means that although there is agreement on integration some countries would be worried about immediate losses should they forfeit their membership to other bodies. SACU members get a yearly dividend of US$2.7 billion, and this is obviously a huge income especially for small countries like Lesotho and they would be worried about losing such an income. This seems to point to the need to introduce the principle of non-reciprocity. All countries in the SADC are in different stages of development. It is therefore too much to ask to expect reciprocal trade relations between unequals. Regional integration must then be able to grant non-reciprocal concessions to weaker countries, so that they too can grow and catch up before being burdened with extra demands. 

 The idea of SADC development and integration needs to be seriously investigated. What needs to be interrogated is the nature of development that is being sort as well as the kind of integration that is being advocated for. Integration must only take place on the basis of people’s needs not because of the dictates of foreign capital.  There is no denying that African ownership and management is of crucial importance in determining the content of developmental plans. Key to this process is the notion of self reliance. Officially opening the meeting the outgoing chairman of SADC, his excellence Festus Mogae, said: “As a regional organisation, we still have problems implementing any of our targeted development programmes with our own resources. For example, if one looks at the outlook budget for 2007/8, member states are expected to contribute 39%, while its international partners are expected to put in 61%. There is a need to instill a spirit of self-reliance in our community.” It is obvious from President Mogae’s statement that if SADC wants to determine the agenda and content of its development and integration, then it should be prepared to put its money where its mouth is. The current situation where member states are contributing just 39% to the SADC budget does not border well for ‘homegrown’ development.

If SADC integration and development is to be a successful, there is a need for a paradigm shift in the relationships between and among SADC countries. An integrated SADC in which only a couple of countries call the shots must be discouraged. Integration should not be about setting structures and crafting programmes that promote asymmetrical relations.

A serious developmental strategy should be guided by the main aim of addressing issues of poverty and closing the ever-widening income gap between the poor and the rich. It is after all the people of SADC whose lives are at stake, it is therefore not too much to ask that the integration and development being sort must seek to give a better life to all the people of SADC. Against this background, it is therefore not enough to be excited about talk of investment flowing into the region as well as the free movement of goods. This seems to suggest that the integration being called for is one that is guided by the liberalization of markets and the unfettered movement of capital. The history of SADC especially with Structural Adjustment Programmes is very clear that this kind of approach does not work. Doing the same thing over and over again but expecting different results is the height of folly. These are difficult times that call for vigilance against the neo-liberal agenda that places total access to markets at the heart of the development paradigm. 

The neo-liberal developmental strategy begins with calls for the total opening up of the economy and the reduction of budget deficits (a euphemism for curbs in money used to fund services like education, health, electricity, water for example). The neo-liberal developmental model pushes for the weakening of the state in fiscal matters. In most cases this leads to heavy cuts in grants that are given to local authorities (municipalities). This has the net effect of forcing local authorities to commercialize so that they can sustain themselves.  In this model of integration and development, the operative word is ‘cost-recovery’ and governments are under pressure to recover the money ploughed into basic services. Needless to say basic services become a privilege far beyond the reach of the poor. These basic services are supposed to be cut off or shut down for those who are not able to pay. What else can be expected from a system where profits take precedence over all human values?

A people-centered developmental strategy recognizes from the onset that basic services (water, health, education, housing, electricity) are a human right. More so this strategy takes the position that government is responsible for the provision of these services. Governments cannot abdicate their responsibilities by hiding behind the invisible hand of the market. Access to water and health should never depend on whether one is able to pay for them. This calls for the abandonment of mercantilist principles that are based on a winner take all ideology. The people-centered strategy rejects an export driven development model. Instead it advocates for a system that is rooted on domestic demand. A system that uses local resources and domestic savings to satisfy human needs. Production and distribution should be planned in such a way as to meet basic needs.  It is wishful thinking to believe that these basic needs can be financed by private capital. While theoretical, the origin of savings is restrained consumption in practical terms it is retained profits. This means that if SADC is to have sustainable finance for development, the primary source of financing should be domestic resources. Foreign investment is not the way to go for sustainable development. Governments should come up with ways of plugging the externalization of domestic savings and withdraw from a system that encourages speculative finance.

In the final analysis, if regional integration and development is to take off, then it must be based on social justice and equity rather than on open markets and cost recovery.

* Percy F. Makombe is the SEATINI  Regional Coordinator for Southern Africa.