Working Papers

When History and Governance Confusion undermine Trade Certainty: The 1964 Trade Agreement between South Africa and Zimbabwe

When History and Governance Confusion undermine Trade Certainty: The 1964 Trade Agreement between South Africa and Zimbabwe

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25 Aug 2016

Author(s): Gerhard Erasmus

Legal certainty is essential for the functioning of FTAs. Compliance with the WTO rules is important to protect the rights of all parties in the multilateral system; including the members of a particular FTA. FTAs (as well as customs unions and interim regional trade arrangements) must be notified to the relevant WTO bodies. And there must be clarity about the technical aspects and functioning of such arrangements. The Transparency Mechanism for RTAs adopted in 2006 enables the WTO and its members to understand these features of a particular FTA and what the internal preferences are about.

The present “Beitbridge dispute” between South Africa and Zimbabwe involves unilateral tariff increases, surcharges and import bans which are incompatible with the applicable SADC FTA procedures, of which both parties are member states. What contributes to the legal difficulties is the fact that trade between the two countries seems to be governed by different sets of rules. The result is uncertainty and governance confusion.

The South African-Zimbabwean trade agreement is discussed here because it is topical and in order to show how uncoordinated legal arrangements result in technical and legal confusion. This happens because the bilateral deals are not aligned to the broader FTA rules and the applicable REC obligations.


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