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Southern Mrica A REGIONAL STRATEGY

May 1999

The World Bank Africa Region

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FOREWORD

After years of struggle, Southern Africa is on the road to greater peace, democracy and development. Comprised of diverse countries with very different assets and needs, the sub-region's best hope for building a prosperous future is through regional cooperation. Countries once divided are now seeking cooperation on many levels and through various groups and institutions, both public and private. Regional cooperation offers Southern African countries the potential of economic benefits from: (i) enhanced visibility to investors; (ii) lower production and marketing costs; (iii) more rapid liberalization; (iv) closer integration of agricultural markets; and (v) better management of transboundary resources. Working to address issues across country borders to achieve mutually beneficial goals raises unique challenges for policymakers.

Given the move towards greater regional cooperation in Southern Africa, there are three main reasons why the World Bank Group needs to sharpen its focus in this area. First, policy reforms of individual countries and those undertaken at the sub-regional level are likely to be mutually reinforcing. Second, many coun-

tries in the sub-region have alreldY asked the Bank for assista~ce or advic~ on a wide range of regional issues. A\nd third, the Bank is already ~volved in ;may regional or cross-co~try activit~es in Southern Africa.' I

, ~. This paper outlines how the World Bank Group can coritribute to S uthern Africa's regional vision. The co ,tribution of the World Bank Group in facilitating

. I I I reglOna cooperation in Southern Africa is

based on its uniqueb. "haracteris~'CS' As an international organJation, the ank's ana-lytical and operatioI}al work pr vides cross-country experience, stress s complementarity of individual country reforms

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an actions at the regionallevel~ facilitates collaboration betweJn institutiohs across

the region, and pro~otes the shE I ring of good practice. As a policy advis r, the

~ank can help, ensur~ that refor are con-SIStent. As a multilateral institut on the

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Bank can serve as art "honest broker" in specific areas. As le1der or guar~ntorf or through the involve1jllent of lFCland

MIGA, the Bank Grqup can be ~partner for private ca~ital, ~e •• Ip improv , the environment for fmancmg cross-bor er investments, and invest in.projects to lmprove

Page ii

management of transbotmdary resources. Specifically, in playing this role the Bank proposes in FY1998-2000 to concentrate its efforts in five substantive areas: physical infrastructure, trade and investment reforms, environment and natural resource management, human resource development, and capacity building.

Southern Africa: A Regional Strategy

This paper and the strategy it embodies is a work in progress. The World Bank is committed to helping the cotmtries of Southern Africa. The cotmtries in the region are taking the lead in determining their needs. As they do so, the Bank will work to sharpen and expand its role in assisting them.

Southern Africa: A Regional Strategy Page 1


Over the past decade, Southern

Africa has turned from the perils of civil war,

apartheid, and stagnation to the promise of peace, democracy, and development. Although there are still serious problems in some countries-Angola and Democratic Republic of Congo in particular-no one can forget the day that Nelson Mandela walked out of a South African prison and marched toward his country's presidency. It caught the imagination of the world, and brought South Africa back into the international fold. Moreover, as South Africa was hurtling toward majority rule, change was also taking place in neighboring Mozambique-less noticed internationally, but perhaps no, less radical, as combatants ended years of bit~er, bloody civil war and. began th~ .hard work of recovering lost years through rapid development. And while Mozambique was finding peace on Africa's southeast coast, across the continent on the southwest coast Namibia was emerging as an independent state and starting its own march toward progress.

Where once these countries were sharply divided internally-and, indeed, antagonistic toward each other-they are

now seeking cooperCj.tion on m~y levels and through many groups, publ c and private-political organizations, ec nomic activity, infrastructure develop ent, and resource managemeIiJ, to name just a few. Southern Africa is a tegion with !widely varying assets and ~idely varyir]lg needs,

and its best hope to ~orge a proSferous future from its difficUlt past is w·th just such regional cooper~tion. This aper outlines how the World Bank can c ntribute to Southern Africa's regional visjon.

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Political and Econolc i

Background :

The countries of Southern· ,.' ca span

a geographic area ~h4~ is roughl~. th~ size of the lower 48 Umtf States. Cdmbmed, they have a Gross Domestic Product of

about US$170 billion ! and a poplation of about 135 million, but individua ly, the countries vary consi4erably in a uence and size. In 1997, for .instance, . ual per capita income in Mmtambique and Tanzania was only a~out $100, ~hile in

I Botswana, Mauritius1 and South· frica it was more than $3,000 (see Figur 1). As for population, there are fewer than million people in Swaziland,!but more t an 38 million in South Africa (see Figu e 2).


May 1999


Despite the huge differences among them, however, many of the countries of Southern Africa do have features in common: small domestic markets,landlocked locations, linked infrastructure networks, reliance on a few commodity exports, and similar institutions. What's more, political borders are porous, allowing substantial unrecorded cross-border movement of labor and goods and further drawing the countries of the region together.

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To understand Southern Aft·ca, one needs to understand the predo . ance of South Africa. Not only does it ve the largest population, ~ut its econdmy overwhelms its neighbors. South Africa accounts for about a third of the area's pop-

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ulation-but three-quarters of t1;le GDP (see Figure 3), and a~out two-t irds of Southern Africa's total exports. outh Africa's economy is :not only th largest in the region, it also is more sophi ticated and diversified than the other c, untries';

"''-'-'v""",! for a bigger share of I of its man~facturing

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sector in GDP is larger; and its depth is greater. South Africa has large bilateral trade kurpluses w:ith each of the other countries f the regiod.

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South Africa's edonomy dO~'. ates the region, but its econo~, ic perfor ance has been lackluster in re~ent years. lthough the economic perforinance of th countries in the area has improved, it con~ues to be uneven. GDP grofvth during the first

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half of the 1990s vatted signific~ntly from I • country to country (~ee Figure 4). Even

many of the countri~s with goo overall

growth rates in the '90s had at least one year in which GDP fell. This unevenness stems from the underlying macroeconomic imbalances that still affect many of the e<,;onomies, as well as from ongoing structural.reforIl1B, pClrticularly in public finance and the pUblic sector. It also complic:ates some regional ntitiatives, most notablyin:frte;area of trade integration, because off~arsthat their short-term effects would hairtper ~conomic recovery.

Nevertheless, in general, the political and economic changes in Southern Africa in recent years have encouraged and intensified efforts in regional cooperation. Majority rule in South Africa has changed regional cooperation from its apartheidera goal of insulating the rest of the region from South Africa to current attempts to coordinate policies and investments with South Africa. Peace in Mozambique has meant that attention can now turn to restoring its transport links, which provide vital trade corridors for Malawi, Zambia, and Zimbabwe as well as for South Africa, and on making the investments needed to


develop Mozambique'S abundant energy and mineral resources.

In the economic sphere, the liberalization and stabilization efforts of most countries in Southern Africa have been the most significant change. Fiscal deficits h'lVe. beenreduced,.overvalued exchange r~teshave:beenadjusted and acc~s to fore~gn ~xcliarge liberalized,. trade reforms hav~~earlt lOWer and more uriifqrm prot~tio:n.,. the operations of p;;trastatals have l;>eeI). .c:J.1rtailed,· .• cQ.I1tr.9Is 9ft the· range of private-sector activity have been reduced, and foreign investment is being encouraged. These reforms have brought some economic gains, although the agenda remains urtfinished in several countries.

Many countries in Southern Africa understand that their individual reform programs would be more successful if their efforts were supplemented by actions at the regional level. For instance, the supply and investment responses to the liberalization efforts of landlocked countries like Zambia and Malawi are likely to benefit from the rehabilitation of transport networks in Mozambique, which would lower the cost of their access to ports. The harmonization of trade policies across the area could encourage investment by stimulating intraregional trade. And, if steps were taken to standardize· financial market infrastructure, investo'rs within the region wouldtal<e the lead in responding to policy imprljwements because they would perceive risks as being lower than potential investors from other regions.

Southern Africa: A Regional Strategy PageS

Trends in Regional Cooperation ~

There are several regional institutions currently involved in regional cooperation . Southern Africa. [see appendix II for a detailed list] .

The Southern Africa Development Community (SADC) is the key political playkr. It comprises all 12 countries in the Southern Africa sub-region (Angola, Botswana, Leso~o, Malawi, Mauritius, Mozambique, Namibia, South Africa, Swaziland, Tanzania, zambla, and Zimbabwe), plus Democratic Republic of Congo and the Seychelles. Compared with its predecessor, the Southern Africa Development Coordination Conference, SAD~ focuses m re on policy reforms aimed at progressively eliminating barriers to the free movement of g~ods, labor, and capital. Conversely, with the advent of majority rule in South,Africa, SADe places less emphasis on the coordination of donor support to projects and sectors aimed at promoting regional cooperation and economic independence from South Africa.. ,

Botswana, Namibia, Lesotho, and Swaziland (called the BNLS countries) also fori the South Africa Customs Union (SACU) with South Africa, thereby sharing tariff strucfures and customs revenues. The same countries/ except Botswana/ also form a monetary uniorL the Common Monetary Area/ which ties their monetary and exchange-rate policies togetrer.

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A preferential-trading arrangement called the Common Market for Eastern and louthem : Africa (COMESA) includes all SADC members except Botswana, Lesotho, Mozambi ue, and South Africa, plus 11 other Eastern and Central African countries. It focuses on redu ing regional tariffs, with the goal of establishing a free-trade area by the end ,of the year 2?OO.

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Eight SADC members-Malawi/ Mauritius, Namibia, the Seychelles,:SwaziIand, Tanzania, .. Zambia/ and Zimbabwe-participate with several Eastern and Central African countries in tl1'e Cross-Border Initiative (CBI). The CBI aims to spe.ed up liberalization of croSS-bordIr. a.CtiVihr,.'. including trade, investment/ and the movement of goods and people, but it does so 0 a voldn-tary basis rather than because of treaty obHgations. .

. . In addition to these official efforts, there have been several recent examples of pri ate-sec..: .

tor moves toward regional cooperation. In transport/ for example, there hre now sevE1ral , . regional associations, including the Federation of Regional Road Freigh~ Associatiorts, made up of national trucking operators/ associations. Examples in agriculture include the formal : ..

. network of commercial farmers across several countries/ and an informahegional asstciatkjriJ •

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0. f .growers of cut flowers. Outspan, the largest citrus producer in. the. reg .. ion,. which i . ba. s. ed., .. in ...... ! South Africa, also has formal links to producers in Mozambique, Swaziland, and Zim abwe, to: whom it provides technical assistance in the form of extension and research services. lAnd in . September 1998, the Southern Mrican Enterprise Network (SAEN), wa~ formed to lihk ~aip ous private enterprises across the region. It mirrors (and is connected wi;th) similar efforts itf[ East and West Africa. '

SADC and other lonna! organizations Mil c:!inue t~ be important partners for t. <Barul (i on ,matters ~f regIonal co.op~~~ation, but .the B~ works Wlth man>:, otherJstakehol~~rs. as wen: This recogrnzes the multipliclty of relationshlps among the countrIes, mapy of whIch ~volve the private sector, so it makes practical sense to work with different groups on different pro-

,jects. In utilizing flexible implementation-or "variable geometry"-the1Bank will build on, I rather than replace/ existing arrangements in the prC?cess of promoting regional coopetation,

Gains from Regional Cooperation

The fortunes of countries in Southern Africa are intertwined despite disparities in size and development levels. For its regional neighbors, South Africa is a. growing source of private investment and expertise for the manufacturing al1d agricultural activities that underpin growth, and it represents one of the best opportunities for them to expand theirnon-traditional exports. As for South Africa itself, etlthough its economy is three times the size of its neighbors' combinedlit too,sees ~enefits in regional cooperation. NOt only do its businesses and·skilleti workers stand to gain .from enhanced opportunities elsewhere .in the region,butit also has a stake in spurring regional economic growth to maintain politicql stability, to benefit from the development of a regional infrastructure, and perhaps Jnost important of all, to deal with the flow of immigrants by lessening the pressure on citizens of neighboring countries to leave their homes.

One of the key differences between the current interest in regional cooperation and previous conceptions is that it now goes beyon~ the narrow confines of trade integration to include, for example, regional infrastructure development, liberalization of labor and capital flows, and harmonization of policies beyond trade and investment regimes in such areas as accounting and' auditing, transport regulation, and resource management. This framework is more promising than the narrower trade integration model for three


The fishing industry in Malawi employs nearly 250,000 people.

reasons; First, combining common interests like regional infrastructure development with trade integration is more likely to provide benefits to all the countries involved, making other types of cooperation more feasible politically. Second, emphasizing aspects other than trade integration reduces the risk that regional cooperation will.end up merely as an inward-looking and protectionist trade agreement;it keeps the focus on the overriding .goall of linking these e.conQrnies with the rest of the world .. Third, a more inClusive framework also may make region~l <;o()petanon more sustainable by expal1ding the n1pnber ,and range of stakeholders" While trade integration is led by goveinmentaction, cooperation in such areas as infrastructure d~velopment involves the private sector more directly and makes collective action more attractive.

With this in mind, regional cooperation offe~s the potential of five main economic be:p.efits:


1. Enhanced Visibility to Investors. All of the countries of Southern Africa need foreign investment and technology if they are to succeed in accelerating growth and diversifying their economies. A larger, integrated market offers more potential demand for investors' goods and services; at the same time, the economies of the region are different enough that together they offer opportunities for diversification. Thus, integrating with their neighbors offers a way for these countries to enhance their size, and thus their visibility, as potential markets and suppliers-making them more attractive places for foreign and domestic investors.l

2. Lower Production and Marketing Costs. Transport expenses are a major contributor to high production and marketing costs in Southern Africa, not only because half the countries are landlocked, but also because transport links are nonexistent or poor. Moreover, many of the agricultural areas with the highest potential-such as northern Mozambique, northeastern Zambia, eastern Zimbabwe, and many parts of Angola-are situated in relatively inaccessible interior or highland areas. These physical disadvantages are exacerbated by an unsupportive policy environment. There are substantial tariff and non-tariff barriers to the flow of trade and investment across the borders of the countries of the region. Reductions in import barriers, regional investments in transport and energy, common policies and procedures vvith regard to taxation and customs clearance, and harmer

addition, their location in the Southern Hemisphere offers the potential for countercyclical supply and demand for products like fruits, vegetables and flowers.

Page 7

nized financial frameworks and Isystems could all help reduce these costs,of doing business in Southern Africa.

3. More Rapid Libefalization. ~gional agreements have thd potential td lock in a more rapid pace of ~beralizatiod, particularlyon trade and tax policies. Onc~ an agreement to reduce trad~ barriers hak been completed, the repudiati~m of trade ieforms by a less committed goyemrnent is less likely

Moreover, such agre~" ments let ~e countries that are liberalizing faster exert ressure on the countries that an~ slower to r form.

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4. Ooser Integrati04 of Agricultural Markets. Because several of the ~ountries in

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Southern Africa are ~ong and nlW1 and because many are lan, dlocked, tr de routes naturally cross borders. When at is coupled with the fact that agricul ,1 surplus

es and deficits ~ont follo~ na90nal bo~ders, the benefits to mtegrating commodIty

i ' markets are apparent. In additiO~' , given the existence of commorl agro-ecolo ical regions that cross borders, the di semination of more appropriate and tes ed agricultural technologies, e~pecially for seeds and plant varieties, woul~ be easier. !

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5. Better Managemttnt of Trans oundary Resources. There are 15 shared iver basins in Southern lfrica, rna . g regional cooperation a cruciall element irt managing this essential natural resource. <!>ther natural resources-frOl~ beautiful scenery to

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abundant wildlife----imake soutirn Africa an excellent tourist tenue. Man of these resources cross natidnal bound ries, and the benefits and costs of develo ing them and using them extend beyond ~he coun-

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try in which they are located. Hence, cooperation between countries would help ensure the greatest net benefits.

The Bank Group's Strategy

Why should the Bank focus on regional cooperation? There are three main reasons:

First, policy reforms of individual countries and those undertaken at the subregional level are likely to be mutually reinforcing. Since the Bank is already involved in the policy dialogue in many of these countries, it makes sense to help coordinate the reform agenda on a regionallevel. As gains are made on a national level, they then will spread more easily in a regional context, and vice versa. Moreover, countries in the region can learn from each other. Given the many similarities of their economies, such sharing of experiences may be more useful than drawing on lessons from countries in other regions.

Second, many countries in Southern Africa have already asked the Bank for assistance or advice on a wide range of regional issues. In other words, they already recognize the importance of regional cooperation.

And third, the Bank is already involved in many regional or cross-country activities in· Southern Africa. These ongoing activities and others proposed for Bank support need to be organized and prioritized. A regional strategy provides the framework to set priorities and make choices.


An important consideration in prioritizing regional activities for Bank Group support is the value added from its involvement. Several characteristics of the Bank Group make it uniquely qualified to playa role in facilitating regional cooperation in Southern Africa.

• As an international organization, the Bank's analytical and operational work provides cross-country experience, stresses the complementarity of policy and institutional reform in individual countries and actions at the regional level, facilitates collaboration between similar institutions across the region, and promotes sharing of good practices.

• As an influential policy adviser, the Bank can ensure that reforms are consistent. This is most important today with regard to trade and investment policy, private-sector participation in infrastructure development, and maize pricing and marketing.

Maputo Port, Mozambique


• As a multilateral institution, the Bank can play the role of "honest broker!' in at least three respects: (a) resolving resource-related conflicts between countries (such as the management of international water basins); (b) fostering public-private partnership (in transport-corridor investments that involve Mozambique or Tanzania and its neighbors, for instance); and (c) bringing governments together to harmonize policies and regulatory frameworks, and strengthening institutions needed for cross-country and regional initiatives (like trade and tax policy).

• As a lender or guarantor or through the involvement of IFC (International Finance Corporation) and MIGA (Multilateral Investment Guarantee Agency), the Bank Group can be a partner for private capital; help improve the environment for private capital to finance cross-border investments; and invest in projects to improve management of transboundary resources. Examples include the Bank's ongoing involvement in the Lesotho Highlands Water Project, work on the Maputo Corridor initiative including IFC's investment in the Mozal Project, and the proposed Maluti-Drakensberg project in South Africa and Lesotho.

Setting Regional Priorities

Broadly speaking, cross-country and regional activities and tasks should be prioritized according to how much each may contribute to the goals of the Bank's country-assistance strategies for the individual

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countries in Southern Africa. S~ecifically, in FY1998-2000 the Bank propoped to concentrate on five substantive arejls:

1. Physical Infrastructure. Fa Imlaling trade and improving trans~ort links is key to fostering ieconomic growth in Southern Africa; Although ~uch insti

tutional reform is at a natiO~alleVel' there are severa~ key oppor unities for regional activity: (a) Restori, g the Beira and N acal~ transport rorridors through Mozam:bique will henefit not

only Mozambique, but Maliwi, Zimbabwe, and !Zambia as ell, and ancillary invesnpents will b of great interest to SoutH Africa; (b) private financing of regional infrast;ructure

projects is clearlt a mUltinatOnal theme, and by s"llPporting i on a regional level, tJie Bank Gro! p can consider common policy isspes, thus

I . ameliorating ant country-specific con-

straints that may arise. Thetank also can help mobili4e private f ancing for these and other projects; (c)' the power sector, re!ional coop¢ration could lead to substantial sa'rings over attempting to dJvelop electt' city

resources counto/ by countr . A study done by SADC itt the early • 990s estimated savings at more thanj$800 mil-

I • lion between 19~5 and 2010, and the

savings are likely, to be evejhigher now that South L[\frica and emocratic Republic of Congo have jo' ed the Southern Africa~ Power PoqI.

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2. Trade and Inves~ent Refo~. As liberalization continues in S<j)Uthern African countries, some form of

regional trade integration is likely to occur under any circumstances. But the varied pace and depth of reform in the region-plus South Africa's economic· dornination-,--,raise doubts about the nature and efficiency of the integration that does take place. To ensure successful trade integration, tariffs and domestic tax reforms·.need to be harmonized, and steps must be taken to ensure that regional trading arrangements are consistent with opening these economies to the rest of the world, rather than closing them off.

3. Financial Sector. Liberalized financial markets that are regionally integrated would support cross-border business activity and attract private capital. Integration of financial markets also offers a way of mitigating the risks to financial institutions from operating within a single small economy in Southern Africa. Since these economies are small and tend to be concentrated in a single commodity, the asset portfolios of the financial institutions within them tend to be exposed to highly correlated price and supply shocks. In this sense, the costs of financial intermediation could decline if financial institutions operate on a regional basis. This will require not only legal changes, but also coordinated reforms in II financial infrastructure" across the sub-region in such areas as the adoption of harmonized accounting standards for financial institutions, supervision and regulatory systems, legal frameworks, and payments and clearance systems, as well as improvements

Southern Africa: A Regianal Strategy

in and coordination of telecommunications facilities. Moreover, there is a need in the region for improving financial management, and the Bank should work with international accounting and auditing associations and bilateral donors to develop and implement a regional program.

4. Environment and Natural Resource Management. Low rainfall, high and increasing demand for water, and the multiplicity of international river basins make water-resource manage-

Katse Dam, Lesotho

ment a key to the region's future. Another key is nature-based tourism, which has the potential to earn foreign exchange and provide employment in much of Southern Africa. Because so much of this potential stems from transboundary resources, there is a need to coordinate biodiversity and park-management strategies among countries. In addition, it will be important to focus on instituting similar environmental laws among the countries, and on assessing the environ-


mental impact of projects such as the development of the Maputo Corridor. Finally, an assessment of climate change, especially the impact of phenomena like E1 Niiio and La Niiia on rainfall, is needed.

5. Human Resource Development and Capacity Building. Several regional

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education projects inVOlvint distance learning are receiving Bank support, and the Bank is expanding "Its successful internship p.t;ogram. Also receiving attention are po~icy and ins~itutional issues, inclUding. strategieSfr prevention and contro[of commuicable dis-eases such as AIDS and rna ria, and labor migration.. !

How the Bank Can Participate

There are many ways the World Bank can be involved in regional cooperation and development-financial and nonfinancial. On the non-financial front, the Bank can provide cross-country economic and technical analysis on regional issues, it can help build countries' capacity for undertaking regional activities, it can provide policy advice, and it can prepare regional projects.

On the .financial side, theBa.J1k has a numberQf .apptoaches itcan:take:

• First, there are Interna~~~al l'anl< for Reconstructibn and D~v~lopment . (mru:;J loariS and Inte~~~ion~l . Develbpm~nt AssociatiQ# (IDA) credits for individual cOl.llltries that are particip~Png in reg~~alprQj~ts.2

• Second, the InternatioI).al :fipanc;e l

Corp9ration (!Fe) ,the! rwQt1d \Bank's private-se~tor <WIl, Ca1).B~?yide l?ans or can<atqyire.~quityin pri~~cor p~yate comRanies $vplved iIt,a1iproject"""i"-a toll road!li>r apower plant~Qfinstance.

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and investments, and both lBRD and IDA (on a pilot program) can guarantee private lenders against governments' not fulfilling their obligations. These Bank group guarantees are particularly promising in addressing the complex risk-sharing issues that arise in regional infrastructure projects like those being considered in Southern Mrica.

• Fourth, the Bank can offer some institutional development grants, which can help strengthen regional institutions or initiatives, but these are small and limited.

There are some constraints on Bank involvement in regional projects. Specifically, the Bank can make loans directly to regional projects, but only if the projects are capable of generating enough revenue to repay the loans. At present, the Bank cannot lend to a non-revenue generating regional authority; loans to such projects must go directly to the:couhtries involved, which,. in turn, must gtlarantee them. So far, how~ve,r, the Bank has been able t~ work around these restrictions. As regionalismprogresses, th~ Bankwill continue to explore ways to meet the region's needs and will evaluate whether. changes ,in ..

Bankproce411tes are needed.

PartJ;1erships and Consultation

Because other institutions within and outside the region are already active in regiorull-cooPeration efforts, the Bank can focus on working with them rather than

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creating new institutions. Some of the regional organizations were mentioned in the box on page 5. From outside the region, the European Union, the Nordic countries, the futernational Monetary Fund, and the U.S, Agency for futernational Development have all played an important role. As its regional efforts evolve, the Bank expects to consult and work closely with all these players and others including the private sector and civil society, Regular consultation is crucial, for example, in regional infrastructure projects like transport and power, where encouraging private-sector financing is an important goaL

Generally, the Bank needs to identify the key potential partners in each of the priority areas because there is no single institution that is active in all the priority areas. (Of course, national concerns usually need to be addressed in regional undertakings, so the Bank will need to work at the national and regional levels simultaneously),

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Conclusion i

The World Bank is committ.ed to help-

ing the countries of southern~frica, and it is clear that in many cases this eans a regional approach ~e develop .ent. Transport corridorsl of necessity will cross national boundaries; economies of scale

can reduce all countries' trans1tions costs; and to be globally comp titive, these small countries nee a to work t .. gether.

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The Bank is pla\i:ing increasf.' g importance on region~lisf in Southe n Afric~, but it is a work ill J1rogress. Th countnes in the region are ta~ing the lea. in determining their needs.IAs they do!so, the

Bank is working to p. harp en ani· expand its role in assisting ~em,

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Appendix I

Southern Africa Development Community (SAD C)

SADC History and Mandate

• Established in 1980 as the Southern Africa Development Coordination Conference (SADCC) with the aim of reducing dependence on the apartheid-era South Africa.

• Became the Southern Africa Development Community (SADC) on July 17, 1992 with the signing of Treaty and Declaration in Windhoek, Namibia.

• Objectives include: reducing economic dependence; forging links for regional integration; and promoting international cooperation.

• South Africa joined in August 1994.

• Chairmanship of SADC rotates among heads of states (president Mandela is the current chairman) and a Council of Ministers supervises the execution of policies and programs by the Secretariat in Gabarone, Botswana.

• SADC members have signed protocols on: Transport; Communication; Meteorology; Shared Water Course Systems; Energy; Trade; Politics; Defense; Security; and I11icit Drug Trafficking.

• ill its Treaty and various Protocols, SADC envisions a process of regional cooperation that allows for flexible implementation ("variable geometry") that builds upon, rather displaces, existing arrangements. between member countries.

• SADC functions through sectoral coordination units whose activities are coordinated by the Secretariat. There are currently 16 such units, and responsibility for their activities is assigned to one of the member countries. [see map on next page] No sectoral units have yet been assigned to the Democratic Republic of Congo and Seychelles.


Appendix I (a)

SADC Sectoral Coordination Units


Appendix II

Summary of Regional Groupings-Southern Africa

SADC COMESA Member Countries

Other Member Countries:

Abbreviations: SADC: Southern Africa Development Community COMESA: Common Market for Eastern and Southern /l.trica. SACU: Southern African Customs Union CMA: Common Market Area CBI: Cross Border Initiative

SACU CMA CBI


rppendix III

SADC Comparative Economic Development Gra~hs


Appendix IV

1818 H Street, N.W. Washington, D.C. 20433 U.S.A. Telephone: 202.458.1344 Facsimile: 202.473.5456 World Wide Web: http://www.worldbank.orgj

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