Botswana, Namibia, Lesotho and Swaziland’s (BNLS) trade relations in the region have been shaped largely by its membership of SACU; The trade regime in the BNLS has been defined by SACU for 80 years. SACU is a free trade arrangement between a group of five countries with close geographical ties, and economic links. Four of the member economies-Botswana, Lesotho, Namibia and Swaziland (BNLS)-are small in terms of market size, level of development and national income, relative to South Africa, the fifth member. The existing SACU agreement contains two provisions, that allow the BNLS to promote industrial development within their territories. Under infant industry protection agreement BLNS members are allowed to seek a change in the common external tariff in order to permit an industry to be established in its territory to serve the entire SACU market. Such protection would only be granted by the common external tariff if the industry could be expected to supply a substantial portion of the SACU market. This arrangement has been used by Botswana to launch the soda ash project at Sua Pan, to serve the South African market for this industrial chemical. Generally, the BNLS countries depend heavily on SACU revenue. It is clear, therefore, that any changes to the SACU agreement, due to say, the WTO agreements, will impact significantly on the BNLS economies, and the ATPSM results attest to this.

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