The SADC FTA Tariff Liberalization Plan

In SADC, trade liberalization was agreed to be asymmetric, because of the different levels of economic development of its membership. SACU has been liberalizing its market faster (front loading) than the other members which were back loading. Differences also in the pace of liberalization were between the countries classified as developing outside the SACU that is, Zimbabwe and Mauritius and LDCs that is, Malawi, Mozambique, Tanzania and Zambia. Zimbabwe and Mauritius were to liberalize faster than the LDCs.
Tariffs liberalization programme is being done progressively in different products:
1. Category A products: mostly capital goods and raw materials with very low or zero tariffs already, comprising about 47 percent of SADC trade, were to be liberalized upon each country’s accession. All SADC FTA members had this category A liberalized to zero soon after the SADC FTA launch.
2. Category B products: a mixed group of products, including intermediate goods, accounting for another 40 percent of the total SADC trade were to be liberalized at different paces for the various country groups over 8 years, i.e. 2001-2008, with South Africa’s liberalization being the fastest and Malawi’s and other LDCs the slowest.
3. Category C products: characterized as ‘sensitive’ products were to start being liberalized 5 years after accession to the SADC FTA and to reach zero % tariffs in 2012. SADC countries listed the following products as sensitive products: sugar, sugar confectionery, beer, textiles and clothing, matches, motor vehicles, footwear, chemicals and plastics.
Sugar, textile and clothing face more restrictive barriers which include quantitative restrictions in the region. There had been a special SADC agreement on textiles and clothing between the SACU countries and Mozambique, Malawi, Tanzania and Zambia (MMTZ) between 2001 and 2005, which covered such product exports from the four countries to their major SACU market to avoid trade shocks. Under the special agreement, Malawi textile companies exported to SACU duty free and with no quota, as long as there had been a two-tariff heading transformation of the article in question. A one-tariff heading transformation attracted quotas for imports into SACU .