The aim of this study was to assess the impact that any changes to the current SADC Rules of Origin (RoO) would have on SACU, as well as to advise SACU member states on the best RoO option forward, one that would not inhibit growth and development in their textiles and clothing industries.

While this study focused specifically on the trade and textiles industry, it also included a wider scope to assess the impact proposed changes to the RoO would have on other issues (for example, employment in adjacent industries), how it would affect the productive base of SACU and SADC, how regional and international trade relations would be affected, what impact the suggested changes would have on supply and demand forces within SACU, SADC and other markets and the tension between maintaining and increasing employment in the sector against long term sustainability, among others.

The study required the Imani team to:

  • Collect and analyse trade in textiles and clothing data between SACU, SADC and third parties, notably RECs in Africa and globally (COMESA, EAC, IOC, EU, NAFTA, etc.)
  • Identify and analyse different tariff dispensations between member states for products of chapters 50 – 63, including tariff dispensations under various MFN agreements, PTAs, the AGOA agreement, TDCA, etc.
  • If the two stage transformation option is to be chosen, does producers in SACU and SADC have the capacity to supply the demand for textile materials
  • Assess the competitiveness of the textile material producing sector – i.e. can the supply quality and quantity at affordable prices
  • Compare and analyse the various Rules of Origin as applied between SACU member states and their trading partners (including both SADC and third parties)
  • Assess the impact the current RoO regime has on trade between SACU and SADC member states
  • Assess the impact any of the proposed changes will have on the current RoO regime to SACU countries
  • Assess the occurrences of trade diversion, the impact cheap material imports will have on SACU textile industry
  • Analyse the current tariff structure of SACU and how proposed changes will affect revenues of its members
  • Assess the implications proposed changes to RoO will have on other regional trade agreements between SACU and third parties
  • Identify and describe all barriers to trade that influence trade in textiles between SACU, SADC and third parties
  • Identify a RoO option that could be adopted by SACU that will not hamper growth and development in the textiles industries
  • Identify additional measures SACU member states can take to achieve their development agenda in the textiles and clothing industries