The first round of discussions concerning the proposed free trade agreement (FTA) between the US and the member countries of the Southern African Customs Union (SACU) are scheduled to take place at the end of May.

SACU includes Botswana, Lesotho, Namibia, South Africa and Swaziland. The two sides will meet every six to ten weeks until negotiations are concluded at the end of 2004.  

US trade representative, Robert Zoellick said the agreement will benefit the SACU by increasing trade, creating jobs, boosting economic growth and development and promoting regional integration. Zoellick added that access to the expanding South African market will also benefit US farmers, workers, businesses and families.  

As part of the negotiation process, a separate group consisting of government and non-government trade experts will be established to concentrate on issues surrounding the lack of trade expertise and infrastructures in SACU member countries. 

Issues related to agriculture, compulsory licenses, parallel imports, South Africa's black economic empowerment laws, transparency with regard to government procurement will be addressed as negotiations begin. 

A number of South African economists believe the FTA agreement could put a strain on the economies of the smaller SACU member nations, as they would have to significantly increase exports in order to make up for lost tariff revenue.  

Another concern has been raised surrounding the recent restriction of the use of compulsory licences in the US-Singapore FTA and the fear that the same restriction would be implemented in this case.

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