ga_th3_pb-ramkolowan_20180727-fdb4eb29255d3714.pdf

This policy briefing evaluates the feasibility of establishing a regional stabilisation fund for the Southern African Customs Union (SACU) to counter revenue volatility. The author argues that such a fund is inappropriate due to the differing sources and scales of revenue volatility among member states and a lack of historical precedent for regional stabilisation funds. Instead, the document recommends revising the SACU revenue-sharing formula and implementing country-level fiscal instruments.

• The establishment of a regional stabilisation fund for SACU is considered inappropriate and infeasible because member states experience different levels and sources of revenue volatility, making it difficult to agree on common deposit and withdrawal rules.
• Revenue volatility affects SACU member states differently: South Africa has experienced far lower volatility than others, while eSwatini has the highest level. The primary drivers of volatility vary by country, with the SACU pool being the main driver for Lesotho, Namibia, and eSwatini, while Botswana's volatility is primarily driven by commodity revenues and South Africa's by internal taxes.
• The current SACU revenue-sharing formula and distribution process are identified as the underlying causes of revenue volatility. Specifically, the formula entitles Botswana, Lesotho, Namibia, and eSwatini (BLNS) to a large proportion of volatile customs revenues, much of which is collected from goods imported by South Africa.
• The process for distributing SACU pool revenues adds further unpredictability due to annual timing, forecast, and ad hoc adjustments. For instance, in 2011/12, actual pool revenue collections were ZAR 16 billion higher than actual payments, while actual payments were ZAR 9.9 billion lower than the forecast.
• There is no known precedent for a regional, multi-country stabilisation fund, as such arrangements would require countries to surrender some fiscal independence to external rules, which is generally unappealing to sovereign governments.
• To address revenue volatility, the document suggests country-level fiscal policy options including the creation of national stabilisation funds, medium-term expenditure frameworks, fiscal rules, fiscal councils, contingency reserves, and revenue earmarking.

APA

South African Institute of International Affairs (n.d.). ga_th3_pb-ramkolowan_20180727-fdb4eb29255d3714.pdf. https://saiia.org.za/wp-content/uploads/2020/01/GA_Th3_PB-ramkolowan_20180727.pdf

Chicago

South African Institute of International Affairs. ga_th3_pb-ramkolowan_20180727-fdb4eb29255d3714.pdf. n.d. https://saiia.org.za/wp-content/uploads/2020/01/GA_Th3_PB-ramkolowan_20180727.pdf.

Wikipedia

{{cite report |author=South African Institute of International Affairs |title=ga_th3_pb-ramkolowan_20180727-fdb4eb29255d3714.pdf |url=https://saiia.org.za/wp-content/uploads/2020/01/GA_Th3_PB-ramkolowan_20180727.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{southafricaninstituteofinternationalaffairsndgath3pbramkolowan20180727fdb4eb29255d3714pdf, author = {{South African Institute of International Affairs}}, title = {{ga\_th3\_pb-ramkolowan\_20180727-fdb4eb29255d3714.pdf}}, institution = {South African Institute of International Affairs}, url = {https://saiia.org.za/wp-content/uploads/2020/01/GA_Th3_PB-ramkolowan_20180727.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }