South African Customs Union (SACU)

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Amid declining merchandise exports due to demand slowdown in the West, India is placing a renewed focus on striking a trade deal with the South African Customs Union (SACU).

About the South African Customs Union (SACU)

  • It is the world’s oldest customs union which was established in 1910.
  • Member countries: South Africa, Namibia, Botswana, Lesotho, and Eswatini (formerly Swaziland).
  • Headquarter: Windhoek (Namibia)
  • It was administered by South Africa, through the 1910 and 1969 Agreements.
  • The customs union collected duties on local production and customs duties on members’ imports from outside SACU, and the resulting revenue was allocated to member countries in quarterly instalments utilizing a revenue-sharing formula.
  • Negotiations to reform the 1969 Agreement started in 1994, and a new agreement was signed in 2002. The new arrangement was ratified by SACU Heads of State.
  • The Economic structure of the Union links the Member states by a single tariff and no customs duties between them.
  • The Member States form a single customs territory in which tariffs and other barriers are eliminated on substantially all the trade between the Member States for products originating in these countries; and there is a common external tariff that applies to nonmembers of SACU.


Q) What is Customs duty?

Customs duty, also known as import duty or tariff, is a tax imposed by a government on goods imported into or exported out of a country. It is a form of indirect tax that is levied at the border when goods cross international boundaries.

Source: India plans to revive trade deal with SACU