Trends in Regional Economic Integration in the SADC and Global South: A Mixed-Method Approach

Abstract

Economic integration through trade liberalisation constitutes a central objective of regional integration arrangements (RIAs) in the Global South. This seeks to foster increased economic interdependence and stimulate trade between member countries. In the Southern African Development Community (SADC), economic integration is a pillar of regional economic development, with reference to industrialisation and long-term socio-economic growth and development. Regional development policy, such as the Protocol on Trade, emphasises increased trade liberalisation to unlock the growth potential inherent to regional value chains. While a linear regional integration process, consisting of the eventual creation of an economic and monetary union, is envisioned in the SADC, the implementation of measures to further economic integration has stalled. The creation of a free trade area (FTA), earmarked for 2008, has failed, with preferential trade agreements in place. This paper aims to investigate trends in economic integration in the SADC and other developing country RIAs. Objectives include determining the extent to which trade liberalising policies have stimulated intra-regional trade growth and delineating recommendations to foster this outcome further. A mixed-method approach is utilised, which includes a qualitative case study analysis of economic integration policies in nine RIAs in the Global South and a quantitative analysis of the intra-regional merchandise trade growth (as a portion of total merchandise trade) per RIA in the sample (1995-2020). The findings indicate that while most of the RIAs have developed policies to support economic integration, there is divergence in current levels and growth of intra-regional trade. Two RIAs, including the SADC, have experienced more than 5% growth in this variable, while four experienced lower growth. Intra-regional trade declined in three RIAs. Applicable interventions include capacitating regional institutions to support relevant policy formulation and implementation, in addition to improving both physical and non-physical regional infrastructure to foster trade growth.