In light of the current economic turmoil occasioned by the ongoing conflict in Ukraine and the COVID-19 pandemic, the member states of the Southern African Customs Union have committed to implementing recovery programs that will help in rebuilding economic resilience.
In a communique issued after the union’s seventh annual summit last week in Botswana’s capital Gaborone, the heads of state from the five members – Botswana, South Africa, Lesotho, Eswatini and Namibia—pledged to analyze the impact of COVID-19 to bring the union’s economies back on a sustainable economic growth trajectory.
The leaders said the union should maximize the opportunity presented by emerging global developments as well as accelerate implementation of its industrialization program which will result in increased productive capacity to reduce reliance on imports, especially for food and fertilizer.
The heads of state declared priority sectors as agri-processing, specifically leather and leather products, meat and meat products, and fruits and vegetables; textiles and clothing, pharmaceuticals, cosmetics and essential oils, automotive and mineral beneficiation.
They directed the Council of Ministers to prioritize fertilizers, agri-chemicals and seed production as part of the ongoing work on agri-processing to deal with the existential challenges the region faces with regard to food security.
The leaders warned if the current Russia-Ukraine conflict is not resolved peacefully through dialogue and negotiation, it can further affect the region.
“This will result in inflation surges especially on food and fuel prices, thus dimming the growth prospects of the already fragile economies,” they said.
Mokgweetsi Masisi, the president of Botswana, said the Russia-Ukraine conflict has worsened the already depressed economy due to the impacts of COVID-19 pandemic.
“This together with the disruptions of the global supply chains has resulted in a surge in inflation the world over, including our region. The surge in inflation, especially for food and energy, remains a present global risk which is hurting consumers and wearing down their purchasing power,” he said.
Masisi said growth prospects in Sub-Saharan Africa are projected to be 3.8 percent this year and 4 percent next year.
“We are now at a stage where there is increasing risk for stagflation. This calls for us a region to undertake counter-cyclical measures to cushion our economies,” he said. “It further highlights the importance of accelerating the implementation of our economic recovery plans and continue to mobilize the necessary financial support.”