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Mpumalanga Businesspeople Confident African Continental Free Trade Agreement will Improve Ease of Doing Business (Department of Trade, Industry and Competition)
The Mpumalanga businesspeople who attended the African Continental Free Trade Agreement (AfCFTA) awareness workshop in Mbombela last Thursday are confident that the agreement will provide them with export opportunities across the continent and improve the ease of doing business to address the challenges in order to enable them to trade effectively.
According to the President of National African Farmers Union in Mpumalanga, Mr Jabu Mahlangu, one of the biggest challenges that farmers are faced with is at the Lebombo border post where there is an estimated 1 500 trucks per day crossing to and from South Africa. He said there is a system blockage at the border.
“Some of our members export fresh produce that cannot be kept in trucks at the border for the whole day. The cost of keeping the machinery operational at the border gate is extremely high. We are therefore urging the South African officials to urgently deal with the border post challenges. We also recommend that there should be clearance away from the border post for bigger trucks that are clogging the system. This can fast-track crossing the border. We are confident that the workshop today did not only share opportunities but will look into the challenges we are facing. We want effortless and seamless movement of goods and people between South Africa and Mozambique so that our produce can find their way to the hotels and restaurants there on time and in good condition,” said Mahlangu.
Agriculture Master Plan still doable but needs adjusting (Engineering News)
Agricultural Business Chamber of South Africa chief economist Wandile Sihlobo has asserted that the implementation of the Agriculture and Agroprocessing Master Plan (AAMP) is still doable. However, it needs to be adjusted and treated as a recovery plan.
Speaking during a webinar on June 20, he noted that many of the issues addressed in the AAMP had become much more complex over the last year and that South Africa would need to adapt it to the current context.
During the webinar – which is part of a series called ‘Think Big’, hosted by financial investment consulting firm PSG and facilitated by journalist Alishia Seckam, which examines some of the most pressing issues impacting South Africa‘s economic development – Sihlobo reflected on whether the master plan was still fit for purpose given the heightened level of local and global challenges in the operating environment.
India is our second largest BRICS trading partner - South Africa (IOL)
INDIA is South Africa’s second largest trading partner within the BRICS (Brazil, Russia, India, China and South Africa) grouping.
In 2022, China accounted for 9.4% of South Africa’s exports, while India had less than half that at 4.5%, according to the South African Revenue Service (Sars). China dominated South Africa’s imports with a 20.2% share while India’s share was around a third of that at 7.2%.
In rand terms, exports to China totalled R188.4 billion, while exports to India were R90.1bn. South Africa imported R367.4bn from China and R130.6bn from India, resulting in a trade surplus in favour of China worth R179bn and in favour of India of R40.5bn.
In 2010, South Africa still enjoyed a trade surplus with India of R1.4bn as trade with India was only starting to expand. In 2010, South Africa only exported R22.1bn to India resulting in a 3.3% share, while imports from India were R20.8bn for a 3.4% share.
What has changed is that imports from India have seen a switch to higher value added vehicle imports.
Eswatini: a new Eco-green City planned with the support of the African Development Bank’s UMDF (AfDB)
The African Development Bank’s Urban and Municipal Development Fund is partnering with the Eswatini Water and Agriculture Development Enterprise on a new urban planning project, closely linked with the development of a transformative agro-industrial hub which will boost economic activities and to attract tens of thousands of workers.
The Fund approved a grant of $400,000 to the “Eswatini New Eco-Green City Masterplan” on 8 June this year. The grant will support the planning of a new urban area in the Shiselweni region of the country, where population and economic activities are expected to grow quickly over the next few years.
The project includes the setting up of a special agro-processing zone, to be undertaken by the Eswatini Water and Agriculture Development Enterprise (ESWADE), as a public-private partnership. The project will generate approximately 100, 000 jobs for workers, creating the need for housing, health and education services for workers and their families.
One hurdle will be to accommodate the influx of workers stimulated by the growth of the agro-industrial complex. A well-planned new eco-city is expected to provide high quality services for the population, stimulate economic diversification, create sustainable employment and reduce poverty in the area, while safeguarding the environment.
“Climate adaptation and mitigation approaches and solutions will be at the center of the urban planning, solutions and sector investment development,” Stated Marcus Mayr, UMDF coordinator, who presented the project during the Oversight Committee.
Over the course of 2022, Gabon’s economy has benefited from high oil prices. However, the rise in global energy prices has also led to high fiscal cost which is affecting social spending for the most vulnerable and impacting the environment. Released today, the latest edition of Gabon Economic Update highlights the importance of implementing adequate reforms to limit the economic, environmental, and social costs of fuel subsidies, while strengthening social protection programs to support the most vulnerable and improving fiscal sustainability.
Gabon’s economic recovery picked up, reaching 3.1% in 2022. The country’s trade balance and its public finances have benefited from high commodity prices and a good performance of commodity exports such as oil, timber and manganese. As a result, Gabon recorded its strongest budgetary surplus in 2022 since the 2014 oil price shocks.
However, combined with the impact of the Russian invasion of Ukraine, the prolonged effects of the COVID-19 pandemic on global supply chains have pushed up global food and energy prices. As the Gabonese population, particularly the most vulnerable, was increasingly affected by inflationary pressures, the Government increased spending on fuel and food subsidies to contain the rising cost of living.
African Trade Report 2023: Export Manufacturing and Regional Value Chains in Africa under a New World Order (Afreximbank)
The African Export-Import Bank’s 2023 edition of the African Trade Report (2023ATR) examines trade and economic developments in Africa and other parts of the world during 2022, a period during which the world economy witnessed a sharp synchronised global deceleration on account of a confluence of overlapping global crises including the lingering effects of COVID-19, particularly in China, where the country’s “Zero COVID” policy led to a sharp reduction in output; heightening geopolitical tensions stoked by Ukraine crisis; increasing risk of fragmentation exacerbated by geopolitical tensions; and the persistence of trade wars among others. Global GDP expanded by a mere 3.4 percent – down from 6.3 percent posted in 2021. Additionally, disruption in global supply chains has been exacerbated by the ongoing Ukraine crisis, while record high inflation and tightening global financial conditions have increased the risk of debt crises, especially in low income and developing market economies that have limited options for refinancing – these fallouts amplify the challenges of globalization where trade is dominated by manufactured products.
Southern Africa youth consultative workshop on AfCFTA set for Windhoek (Namibia Economist)
The Ministry of Industrialisation and Trade (MIT) in collaboration with the Ministry of Sport, Youth and National Service and the National Youth Council will host a two-day Southern Africa Youth Consultative Workshop on the Africa Continental Free Trade Area Agreement (AfCFTA) Protocol on Women and Youth in Trade, from 22 to 23 June.
In partnership with the AfCFTA Continental Secretariat, Youth for Tax Justice Network Africa, and with the support of the United Nations Development Programme and European Union Delegation to Namibia, the Consultative Meeting will bring together young people and women in business, Government officials, and youth leaders across the SADC region to, among others, galvanise action and mainstream youth voices towards a common voice on the AfCFTA Protocol on Women and Youth in Trade and foster a deeper awareness of challenges faced by young entrepreneurs, producers, and traders across the region.
The outcome and recommendations derived from the workshop will culminate into a Report containing strong policy and programme recommendations that will inform the design of national policies and complementary measures to address and remove systematic barriers so that women and youth share in the gains of the AfCFTA Agreement.
Disruptions push Africa to the back of the queue (fDi Intelligence)
The African Continental Free Trade Area (AfCFTA) has long been celebrated for its potential to create the world’s most populated economic bloc.
Secretary-general Wamkele Mene believes the recent disruption in global value chains has once again pushed Africa to “the back of the queue”, strengthening the case for the development of more intertwined and resilient African value chains.
Q: How does the AfCFTA fit the global push for nearshoring? A: The events that unfolded from the Covid-19 pandemic are good examples of the urgency facing the AfCFTA. During the pandemic, global supply chains were disrupted. Individual countries imposed export restrictions on the critical tools that were required to fight the pandemic, at least in the first six to nine months. That pushed Africa to the back of the queue for things like vaccines, antiseptics and masks, because we are so reliant on these global supply chains and Africa’s productive capacities are very low.
Then the war in Ukraine happened. Last year, I visited an African company that manufactures car seats, and they told me they had to suspend production for months because they couldn’t get the wiring harness produced in Ukraine that they required. But that wiring harness is produced with copper that comes from Zambia, and then gets sent back to Lesotho for the production of the cast. These are clear examples that when global supply chains are disrupted, Africa suffers. People lost jobs in Lesotho because for three to four months there was no production.
What this reinforces is that SEZs are absolutely essential for Africa to be able to establish an alternative and more resilient supply chain without disengaging completely from global supply chains. Otherwise, we will be forever at the mercy of global supply chains. And when there’s disruption, we will forever be at the back of the queue.We have to develop self-sufficiency and the productive capacity in priority areas. SEZs are an essential part of creating that local productive capacity.
The 46th Ordinary Session of the Permanent Representatives’ Committee (PRC) begins (African Union)
The 46th Ordinary Session of the Permanent Representatives’ Committee (PRC) kicked off on 19 June 2023, in preparation for the 43rd Ordinary Session of the Executive Council and the 5th Mid-Year Coordination Meeting between the African Union, The Regional Economic Communities and the Regional Mechanisms to be held from the 13-16 July 2023.
Speaking on activities carried out under the theme of the year 2023, the Deputy Chairperson underscored the need to enrich the report submitted to the consideration of the PRC. “The report on the activities carried out under the theme of the year 2023 will certainly be a source of inspiration to appreciate and enrich the policy brief and the roadmap for the theme of the year 2024 devoted to education,” emphasized Dr. Monique Nsanzabaganwa.
The Deputy Chairperson of the AU Commission, concluded her statement by encouraging the members of PRC to conduct a critical reflection in order to improving the operational performance of the continental organization. “The African Continental Free Trade Area confirms and strengthens its first steps in the deployment of its action plan. The report concerning it, submitted for your consideration, I am sure, will provoke your desire to see it grow at an accelerated rate to achieve the objectives assigned to it in the well-understood interest of the affirmation of the commercial presence of the Africa on the international stage,” said Dr. Monique Nsanzabaganwa.
EAC coffee, avocado exports grow amid Covid-19 hiccups (Tanzania Daily News)
Export of coffee and avocados from the East African Community (EAC) to the Europe Union (EU) have grown by 35 percent and 7 percent respectively from 2018 and 2022. A report provided by the EU-EAC Market Access Upgrade Programme (MARKUP), a development initiative started to grow EAC’s agri-export trade, indicates that export of the two commodities also blossomed within the region in the four years of the program.
“The (EAC) region was not spared the far-reaching effects of the COVID- 19 pandemic. Despite these challenges, great milestones on exports of agri-based products, including MARKUP priority value chains, were recorded,” the report reads in part.
MARKUP is a regional development initiative of the EAC and the EU that provides support to small and medium-sized enterprises (SMEs) in the EAC.
Speaking during the launch, EAC Acting Director of Trade Flavia Busingye, said MARKUP had created numerous trade opportunities for agri-SMEs in the region. “The campaign “MARKUP: Growing agri export markets” aims to raise awareness of the opportunities in agricultural trade, and to demonstrate that international markets are within reach of East African exporters,” she explained. The EAC official noted that since its inception in 2018, MARKUP has generated useful resources for growth of agri-exports in the five EAC countries.
DP World in Talks to Expand East African Coverage to Tanzania (BNN Bloomberg)
Container terminal giant DP World Ltd. is in talks with Tanzania to manage seven berths at the East African nation’s main port of Dar es Salaam. If successful, the negotiations will expand the the Dubai-based company’s reach on the east African coast, where it already has interests in nations including in Somalia, Eritrea, Djibouti and Mozambique.
Tanzania wants to improve efficiency at the port and upgrade its transport infrastructure in a bid to become a regional trade and logistics hub, Works and Transport Minister Makame Mbarawa told reporters in Dar es Salaam.
Its main rival is Kenya’s Mombasa port to the north and they compete for business from African states such as Democratic Republic of the Congo, Rwanda, Uganda and Burundi. Dar es Salaam also serves as a gateway for Zambia, Malawi and Zimbabwe.
Fresh investment from DP World will help reduce congestion and slash the average stay for a vessel to 24 hours from five days, and speed up clearing times to 60 minutes from 12 hours, Mbarawa said.
National Sensitization Programmes on the Single African Air Transport Market Underway (COMESA)
COMESA has kicked-off a series of workshops to create awareness about the Single African Air Transport Market (SAATM), which provides for the full liberalisation of intra-African air transport services in terms of market access, traffic rights for scheduled and freight air services by eligible airlines thereby improving air services connectivity and air carrier efficiencies.
The first workshop took place in Mogadishu, Somalia, 18 – 19 June 202, organized by COMESA under the programme on Support to Air Transport Sector Development (SATSD) in Eastern Africa, Southern Africa and the Indian Ocean Region (EA-SA-IO). Malawi, Seychelles and Burundi are next.
In her statement, COMESA Secretary General Chileshe Mpundu Kapwepwe observed that while many air transport markets outside of Africa have been liberalized to a significant extent, most intra-African air transport markets remain largely closed.
“This has affected air connectivity within Africa as air travel costs remain prohibitive and continued to limit the potential for economic growth and development in our region,’’ she noted in a statement presented by Mr. Francis Okome, Air Transport Policy & Regulatory Expert under the SATSD project.
Inside African Union drive to manufacture vaccines (The Independent Uganda)
Ramping up its vaccine and pharmaceutical manufacturing is probably one of the most audacious goals set by the African Union recently and players in the sector say manufacturing can move from the current 1% of local production to about 60% by 2040 In fact, the African Union has a new public health order which also seeks to increase the manufacturing of therapeutics and diagnostics as one of the continent’s pillars to ensure health security for its 1.4 billion people.
“Our ambition is to progressively increase the share of vaccines manufactured within the continent from 1% to 60% by 2040,” Yared Yiegezu Zegiorgis, a Senior Research Data Analyst at the Addis Ababa-based Africa Centres for Disease Control and Prevention (Africa CDC) recently told delegates who met in Uganda to discuss the state of vaccine and pharmaceutical production in Africa.
The AU has already set up and mandated the Partnerships for African Vaccine Manufacturing (PAVM) to develop a framework for action to execute this plan.
According to Zegiorgis, the PAVM framework, which was launched in 2021, is on a multi-stage journey to realize the AU’s new public health order with the current focus being “strategy implementation.”
In an effort to enhance foreign investments, tourism and provide easier access to abundant opportunities within the ECOWAS region, the Authority of ECOWAS Head of State and Government adopted in 2011 the introduction of ECOVISA, a single visa system similar to the Schengen model. The ECOWAS Commission has been tasked with working towards the realization of this visa for Migrants of third countries.
On May 25, 2023, the Directorate of Free Movement of Persons and Migration of the ECOWAS Commission organized the Seventh Heads of Immigration Meeting in Accra, Ghana. The purpose of this meeting was to discuss the implementation of ECOVISA, its related cost, design as recommended by Experts in charge of visa issuance and control drawn from Member States and determine the way forward.
During the Accra meeting, it was recommended that a comprehensive comparative analysis of visa regimes in other continents be conducted to ensure the implementation of ECOVISA aligns with global best practices. Additionally, the Heads of Immigration recognized the need for regular engagement to discuss modalities and assess the progress of ECOVISA implementation at different stages.
ECOWAS has been dedicated to a harmonized approach in implementing the Protocol of Free Movement of Persons since its adoption. Member States prioritize creating a secure environment for migrants and removing barriers to facilitate mobility, particularly for community citizens. This requires a collective effort from all stakeholders and key actors involved in migration management within their respective countries.
Experts pitch for Kenya to join BRICS (China Daily)
As more countries are considering joining BRICS, the bloc of emerging economies, experts in Kenya are now urging the new administration to follow suit for economic and trade benefits.
The 15th summit of BRICS, comprising Brazil, Russia, India, China and South Africa, will be held in Johannesburg, South Africa, in August. The five countries account for over 40 percent of the world’s total population and a quarter of the global GDP. Some 19 countries reportedly have expressed willingness to join the group.
X.N. Iraki, an economist at the University of Nairobi, said Kenya, as a major economy in East Africa, should consider joining BRICS for trade and economic prosperity. Kenya should follow its peers like Algeria and Egypt in Africa in applying for BRICS membership, he said. “This will enable us to create better markets for our agricultural products.” Iraki also suggested that for Africa to grow its economy, there is a need to use local currency to promote intra-Africa trade.
In Comoros, leaders outline a common vision to harness Africa’s maritime potential (UNECA)
A historic ministerial meeting took place on 14 June in Moroni, the capital city of the Comoros, where blue economy experts and government officials from across Africa gathered around President Azali Assoumani to discuss how to leverage the potential of the oceans, seas and rivers for sustainable development.
The meeting resulted in the adoption of a strategy known as the Moroni declaration, which outlines a common vision and commitment to promoting the blue economy as a key driver of growth, innovation and resilience in Africa.
The blue economy refers to the sustainable use of oceans, rivers and lakes resources for economic and social benefits while preserving the health and diversity of marine ecosystems.
Africa has a unique position in the global blue economy, with 38 coastal states, 90% of its imports and exports conducted by sea, and an estimated value added of $100 billion generated by coastal tourism by 2030. The continent also has 49 million jobs currently generated in the blue economy sectors, and a projected value of $405 billion by 2030.
The participants agreed on a set of priority actions to implement the Moroni declaration, such as deepening trade relationships between Island States and other States throughout the AfCFTA, expanding the regional maritime security architecture for the Western Indian Ocean and advocating for increased public and private investment in; sustainable coastal and marine value chains, promoting, among others, responsible and sustainable fisheries, green infrastructures, ecotourism, renewable energies, and blue innovation.
The Moroni declaration will serve as a basis for engaging with other regions and stakeholders in advancing the blue economy agenda at the global level.
UNCTAD launches new index for countries to better measure economic potential (UNCTAD)
UNCTAD launched on 20 June a new generation Productive Capacities Index (PCI) to help countries make more accurate diagnostics and measurements of their economic performance.
In turn, this can shape more effective policies and their implementation. The PCI measures countries’ abilities to produce goods and deliver services, which are critical for international trade and global production value chains.
The PCI is available through a dedicated online portal with publications, manuals, resources and tools. It maps the productive capacities of 194 economies and provides a better measure of development than other traditional benchmarks such as gross domestic product (GDP). It’s multidimensional and measures economic inputs and potential as opposed to outputs.
UNCTAD Secretary-General Rebeca Grynspan said: “No nation has ever developed without building the required productive capacities, which are key to enabling countries to achieve sustained economic growth with accelerated poverty reduction, economic diversification and job creation.” UNCTAD defines productive capacities as “the productive resources, entrepreneurial capabilities and production linkages that together determine the capacity of a country to produce goods and services and enable it to grow and develop.”
Members to meet external stakeholders to advance discussion on extending TRIPS Decision (WTO)
The Chair of the TRIPS Council, Ambassador Pimchanok Pitfield of Thailand, said that since the last TRIPS Council meeting in March, she had met with members in various configurations to try and find common ground on the TRIPS Decision extension. The Chair recognized that no significant progress was made as some domestic consultations were ongoing but stressed her intention to keep working to bridge the existing differences.
Members examine deliberative functions, institutional matters on WTO reform agenda (WTO)
The informal meeting “is a further important opportunity for confidence and trust-building which can enable us to continue working on a good footing on these issues and overall on WTO reform,” she told members.
Director-General Ngozi Okonjo-Iweala said the discussions were part of better harnessing the potential of all WTO bodies to address pressing global trade matters and concerns and deliver meaningful results for the benefit of people around the world.
Members hold robust discussions on implementing Trade Facilitation Agreement (WTO)
The Committee meeting featured a dedicated session on the particular challenges faced by landlocked developing countries (LLDCs) in the transit of goods.
Concrete solutions were developed at the workshop to address challenges relating to customs formalities, transit guarantees, container seals and tracking, transit corridors and improving support to WTO members in TFA implementation relevant to transit activities.
How Digital Trade Can Drive Africa’s Economic Growth (U.S. Chamber of Commerce)
Digitization has shaped the way millions across Africa shop, bank, and communicate. It has also changed the prospects of the continent’s trade landscape and has the potential to unlock new pathways for economic growth. The next step in Africa’s digital future will be regional, fulfilling the vision outlined in the African Union’s Digital Transformation Strategy for Africa through strong frameworks and policies offered by the African Continental Free Trade Area (AfCFTA) that can help the continent get there.
How the digital economy and regional integration through the AfCFTA can transform African trade, lift economic growth, and support livelihoods across the continent dominated discussion at the latest Kenya International Investment Conference (KIICO.)
At the invitation of the Cabinet Secretary for Trade of Kenya Moses Kuria and the Kenya Investment Authority (KenInvest)’s Managing Director June Chepkemei, the U.S. Chamber’s U.S.-Africa Business Center (USAfBC) was the strategic partner of this year’s conference, “Unlocking Africa’s Gateway.” The conference took place May 29 – 31 in Nairobi, Kenya, on the periphery of negotiations held by the AfCFTA Council of Ministers
The AfCFTA Digital Trade Policy Dialogue was but one of several events organized with the input of the USAfBC, as part of fulfilling its partnership under the historic MOU signed in late 2022 between the AfCFTA Secretariat and the U.S. Chamber—the only private sector organization to sign such an MOU in the world.
Both the AfCFTA and digital trade are poised to be engines of African growth. An interconnected Africa, made possible through the AfCFTA and a single digital African market, will lower barriers to business, trade, the internet, online communication, banking, health care – and much more. Connections throughout the continent are key to bridging digital divides, sparking economic growth, creating jobs, and moving all of Africa into the digital age. The U.S. Chamber stands ready to be a trusted partner and engaged advocate.
UK withdraws duty benefit scheme; to hit Indian exports (The Tribune India)
The UK’s decision to withdraw duty benefit scheme GSP may impact Indian exporters from certain labour-intensive sectors such as leather and textiles as they were the major beneficiaries, according to experts and traders.
The UK is replacing the Generalised Scheme of Preferences (GSP) with a new Developing Countries Trading Scheme (DCTS) from June 19. Labour-intensive sectors, including certain textile items, leather goods, carpets, iron & steel goods and chemicals may get impacted due to this.
“As the UK has come out of the EU, it has designed its own GSP scheme. Each country sets a product-wise threshold limit, if a country’s exports cross the limit, the GSP concessions stop. The UK withdrawing GSP concessions on labour-intensive products was expected as the two countries are negotiating a free trade agreement,” GTRI co-founder Ajay Srivastava said.
Understanding rules of origin under the Developing Countries Trading Scheme (GOV.UK)
The changes include simpler product specific rules (PSRs) and more generous cumulation options for exporters in Least Developed Countries ( LDCs ). For example, leather shoes under Chapter 42 have alternative PSRs. LDCs could either meet a Change of Tariff Heading or satisfy the 75% non-originating material maximum rule.
After the pandemic storms, digital trade offers LDCs rays of sunshine (Trade for Development News)
The dark storm of the coronavirus pandemic came with a silver lining: new ways of providing services and doing business by leveraging e-commerce and other digital opportunities. Video conferencing apps enabled lessons or work to be accessed remotely; mobile apps delivered food, groceries, and medicines at the click of a button.
But silver linings don’t shine bright for all. Gaps in technology, infrastructure and skills, especially in Least Developed Countries (LDCs), highlighted the need to help entrepreneurs grasp the possibilities of digital transformation.
With funding from the Enhanced Integrated Framework (EIF), the United Nations Conference on Trade and Development’s (UNCTAD) E-commerce and Digital Economy Program has conducted many rapid e-trade readiness assessments to identify policies that need to be adjusted to boost e-commerce.
As a result, several countries are investing in infrastructure, such as building e-commerce platforms in Cambodia and Senegal, while also developing skills and payment solutions. Such initiatives require partnerships with key agencies and institutions, and need financial resources to be mobilised through public-private partnerships.
Related News
EU and Kenya conclude negotiations for an ambitious Economic Partnership Agreement with strong sustainability provisions
The EU and Kenya have announced today the political conclusion of the negotiations for an Economic Partnership Agreement (EPA). The Agreement will boost trade in goods and create new economic opportunities, with targeted cooperation to enhance Kenya’s economic development. It is the most ambitious EU trade deal with a developing country when it comes to sustainability provisions such as climate and environmental protection and labour rights.
The negotiations were concluded during an official ceremony in Nairobi by European Commission Executive Vice-President and Commissioner for Trade Valdis Dombrovskis and Cabinet Secretary of Kenya’s Ministry of Investments, Trade and Industry, Hon. Moses Kuria, in the presence of Kenyan President Dr. William Samoei Ruto.
The EU is Kenya’s first export destination and second largest trading partner, totalling €3.3 billion of trade in 2022 – an increase of 27% compared to 2018. The EPA will create even more opportunities for Kenyan businesses and exporters, as it will at once fully open the EU market for Kenyan products, and it will incentivise EU investment to Kenya thanks to increased legal certainty and stability.
Kenya has a pioneering role in sustainability efforts on the African continent and is a reliable ally in the fight against climate change. It co-leads the Coalition of Trade Ministers on Climate initiative launched earlier this year, together with the EU, Ecuador and New Zealand. The EU-Kenya EPA builds on this strong track record and is the first agreement with a developing country in which the EU’s new approach to trade and sustainable development is reflected. The deal contains strong trade and sustainability commitments, including binding provisions on labour matters, gender equality, environment and the fight against climate change.
This is a balanced agreement, taking into account Kenya’s development needs by allowing it a longer period to gradually open its market, safeguards for agriculture, and protection of its developing industry. A dedicated chapter has been included on economic and development cooperation, aimed at enhancing the competitiveness of the Kenyan economy. Together with EU development assistance, this will help build capacity and assist Kenya in implementing the EPA smoothly, while supporting local farmers in meeting EU standards and in reaping the opportunities this agreement provides.
Background
The Economic Partnership Agreement between the EU and Kenya aims at implementing the provisions the EU-East African Community (EAC) EPA, and it will be open for other EAC countries to join in the future.
The EPA and its ambitious commitments represent a crucial deliverable of the EU’s 2021 Trade Policy Review and its trade policy with Africa, helping the EU to deepen and expand its current trade agreements with African countries and enhance their sustainability objectives.
Key elements of the EU-Kenya Economic Partnership Agreement
The EU and Kenya have concluded today the negotiations on an ambitious trade agreement through which they will implement bilaterally the regional Economic Partnership Agreement (EPA) between the EU and the Eastern African Community (EAC).
The agreement, which will bring about an important boost for trade in goods, contains substantial development and cooperation elements and is the first and most ambitious trade deal with a developing country to contain strong commitments on sustainability.
The EU is Kenya’s second largest trading partner, and Kenya’s most important export market. Total trade between the EU and Kenya reached €3.3 billion in 2022, with an increase of 27% compared to 2018.
EU’s imports from Kenya are €1.2 billion and are mainly vegetables, fruits, and flowers. EU exports to Kenya amount to €2.02 billion and are mainly mineral products, chemical products, and machinery. The EU is the first export destination for Kenya, with 16% of its total exports in 2022, followed by Uganda (12%) and USA (8%).
The EPA between the EU and Kenya is a significant milestone as it will be the first trade agreement with an East African Community country to enter into force. A regional EPA was negotiated in 2014, signed in by Kenya, Rwanda and the EU in 2016, but could not be applied as it required signature and ratification by all the EAC countries. This EU-Kenya agreement implements bilaterally the provisions of the Economic Partnership Agreement between the EU and the EAC Partner States. It follows a decision by the East African Community Heads of State Summit on 27 February 2021. The EU-Kenya Agreement will be open to accession of the EAC Partner States.
1. Trade and investment, opportunities for business in the EU and Kenya
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The agreement will provide free access to the EU market by removing tariffs and quotas on all Kenyan exports of goods (except arms).
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Trade liberalisation will be asymmetrical: Kenya will open its market partially and very gradually to imports from the EU, taking account of the different levels of development. So, Kenya will benefit from transitional periods and exclusion of sensitive products from liberalisation.
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The agreement allows dealing with unfair trade. It references and incorporates WTO law, which for example deals with dumping products at unreasonable low prices in the other party’s market. The inclusion of safeguards will also allow the EU and Kenya to reintroduce duties if a surge in imports from the other side disturb or threaten to disturb their economies. Special safeguard conditions are envisaged to protect Kenyan infant industries (those that Kenya seeks to develop). Unjustified or discriminatory restrictions on imports and exports will also be banned.
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Rules of Origin will define the products eligible for trade preferences under the EPA, as set out in the EU Market Access Regulation. This regulation provides duty-free and quota-free access to the EU market for products originating in African, Caribbean and Pacific countries which do not benefit from the EU’s Everything But Arms (EBA) scheme or have concluded, but not yet ratified, an EPA with the EU. It is envisaged that a new protocol on rules of origin will be negotiated as soon as possible, but at latest within the first five years of the implementation of the EPA.
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The EU and Kenya share the objective of providing efficient custom procedures to traders, in particular to smaller entities. Customs-related provisions will aim at facilitating trade, promoting better customs legislation and procedures, close cooperation between Kenya’s and the EU’s customs institutions and providing support to the Kenyan customs administration.
2. Agriculture, industrial development and diversification of trade
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Provisions on agriculture will aim at sustainable agricultural development, including food and nutrition security, rural development, including the sustainable use and management of natural and cultural resources, and income and job creation in the agricultural sector in Kenya. These measures will guarantee that the EU will not apply export subsidies for agriculture products, even in times of market crisis.
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Provisions on animal and plant health and hygiene (sanitary and phytosanitary – SPS) measures will allow, among others, to address animal and plant health-related trade issues, promote the harmonisation of intra-regional standards in accordance with international standards, and enhance the capacity of Kenya to implement and monitor these measures. Nothing in the agreement changes the way the EU adopts and enforces its food safety rules for imports, which are the same for domestically produced and imported products.
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The EU and Kenya will reinforce joint work on SPS matters and engage in a policy dialogue on agriculture and food security, which will include transparency on their respective domestic policies.
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EU development assistance, through trade capacity-building measures, will support farming and rural employment, and farmers’ capacity to comply with agricultural standards. This alignment of standards will make it easier to comply with the requirements necessary to bring those products into the EU and open trading opportunities in the agricultural sector.
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The agreement will put in place an effective mechanism to solve disputes that may arise regarding the interpretation and application of its provisions. Among other things it will include independent panellists and due process and transparency involving open hearings, the publication of decisions, and the opportunity for interested parties to submit views in writing.
3. Trade and sustainable development
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The agreement includes a dedicated chapter on Trade and Sustainable Development that covers labour, gender equality, as well as environmental and climate matters.
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This includes the respect and promotion of the International Labour Organization fundamental rights, and the implementation of UN standards and obligations to prevent gender discrimination and support women’s empowerment.
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It also commits the parties to the implementation of multilateral environmental agreements (e.g. the Paris agreement on climate change), and contains obligations to combat illegal wildlife trade, illegal logging, and illegal, unreported and unregulated fishing.
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The EU approach for the joint implementation around these commitments is fundamentally centred on cooperation and engagement. Change is best facilitated with continuous and positive engagement, supported by regulatory dialogue, technical assistance and capacity building.
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The Trade and Sustainable Development commitments are binding and enforceable. In case one of the two parties violates these commitments, the agreement envisages the possibility to trigger a specific dispute settlement mechanism. The dispute settlement mechanism also includes a so-called compliance stage, which means that the party found in violation of its TSD commitments will have to promptly inform how it will implement the panel report and carry this out within a certain period of time. This will be subject to panel review.
4. Implementation and monitoring
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The agreement will have an institutional chapter that envisages to set up ministerial, senior official and technical bodies to steer, support and oversee its implementation.
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A chapter on economic and development cooperation will aim at enhancing the competitiveness of the Kenyan economy by building supply capacity and assisting Kenya in implementing the EPA smoothly.
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The agreement will offer the possibility of adding new areas once Kenya is ready to take up such commitments. For instance, provisions on trade in services, , competition policy, investment and private sector development, intellectual property rights, transparency in public procurement could be envisaged to be added within five years following the entry into force of the deal.
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The agreement will give civil society representatives (business associations, trade unions, non-governmental associations) a role in its implementation, including on the provisions on trade and sustainable development. Domestic advisory groups will be set up with independent civil society representatives that will advise both sides on the implementation of the Agreement, as well as a Consultative Committee were representatives of civil society from the EU and Kenya will meet regularly.
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The agreement includes a commitment to initiate a review process of the TSD aspects of the agreement, as soon as the trade agreement comes into force.
Next steps
The EPA will have to go through legal revision (“legal scrubbing”) and then be translated before the European Commission submits it for signature and conclusion to the Council. Once adopted by the Council, the EU and Kenya can sign the agreement. Following the signature, the text will be transmitted to the European Parliament for consent. After the consent by the Parliament, the parties may decide to provisionally apply parts of the agreement. Once Kenya and the EU Member States ratify it, the agreement enters into force.
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EU and Kenya conclude negotiations for an ambitious Economic Partnership Agreement with strong sustainability provisions (European Commission)
(European Commission)
The EU and Kenya have announced today the political conclusion of the negotiations for an Economic Partnership Agreement (EPA). The Agreement will boost trade in goods and create new economic opportunities, with targeted cooperation to enhance Kenya’s economic development. It is the most ambitious EU trade deal with a developing country when it comes to sustainability provisions such as climate and environmental protection and labour rights.
The EU is Kenya’s first export destination and second largest trading partner, totalling €3.3 billion of trade in 2022 – an increase of 27% compared to 2018. The EPA will create even more opportunities for Kenyan businesses and exporters, as it will at once fully open the EU market for Kenyan products, and it will incentivise EU investment to Kenya thanks to increased legal certainty and stability.
This is a balanced agreement, taking into account Kenya’s development needs by allowing it a longer period to gradually open its market, safeguards for agriculture, and protection of its developing industry. A dedicated chapter has been included on economic and development cooperation, aimed at enhancing the competitiveness of the Kenyan economy. Together with EU development assistance, this will help build capacity and assist Kenya in implementing the EPA smoothly, while supporting local farmers in meeting EU standards and in reaping the opportunities this agreement provides.
Liquid’s new subsea cable enhances connectivity between Mauritius and South Africa (Engineering News)
The successful deployment of the Mauritius Telecom T3 subsea cable is set to enhance connectivity between Mauritius and South Africa.
The subsea cable, deployed at pan-African technology group Liquid Intelligent Technologies’ landing facility in Amanzimtoti, in Durban, South Africa, comprises four 13.5 Tb/s fibre pairs, with a design capacity of 54 Tb/s for the whole system.
It is expected to bolster the stability and redundancy around the connectivity that exists between the two countries, said Liquid Intelligent Technologies South Africa CEO Deon Geyser.
“Liquid South Africa is bringing a critical increase in the availability of high-speed and reliable Internet connectivity for economies in the Indian Ocean islands to South Africa, leveraging on Liquid’s 110 000 km of fibre backbone in Africa.”
Driven By Minerals, Metals, Nigeria’s Exports To Surge To $127bn By 2030 (Leadership News)
Driven largely by expected growth in the metal and minerals sector of the economy, the value of Nigeria’s export to other countries is predicted to hit $127 billion by 2030, a new report has projected. The report titled ‘future of trade’ by Standard Chartered, a global bank, said the country’s exports will grow annually by an average rate of 9.5 per cent between 2021 and 2030.
“This growth will be driven by activities in agriculture (4 per cent), metals and minerals (94 per cent), especially with the advent of the African Continental Free Trade Agreement, adding that by 2030, exports will constitute 20 per cent of the country’s Gross Domestic Product (GDP),” it said.
It said inclusion in the free trade area helps to facilitate trade in sectors ranging from fishery and textiles to automotives and electricals.
“Following this agreement, Nigerian exports to African markets outside of West Africa are expected to increase significantly, and reach markets such as Botswana, Egypt and Kenya,” it added. Last year, the country recorded a trade surplus of N1.2 trillion compared to a deficit of N1.94 trillion in 2021 as the cost of exporting commodities exceeded the value of its import. Data from the National Bureau of Statistics revealed that total trade was N52.4 trillion in 2022, 31.8 percent up from N39.8 trillion in 2021, of which total imports amounted to N25.6 trillion, while total exports were recorded at N26.8 trillion.
Zambia Receives Rapid Test Kits to Facilitate Transit Trade (COMESA)
Secretary at the Ministry, Mrs Lillian Bwalya received the equipment which will be used by the Ministry of Health. They will be used at the borders as one of the solutions to eliminate impediments to trade at Chirundu, Mwami and Nakonde One Stop Border Posts (OSBP) under the Zambia Border Post Upgrading project.
The equipment were procured under the COMESA Trade Facilitation Programme (TFP), with funding from the 11th European Development Fund. The TFP is a EUR 53,000,000 programme with COMESA, under which a EUR 6,880,000 sub-delegation agreement was signed with Zambia in November 2020.
Mrs Bwalya said that testing of products in Zambia has been highly centralised and is usually done from the provincial centres. Hence the procurement and placement of the kits at the designated borders will enable testing of products without having to send samples to the provincial centres. This will allow for more effective surveillance and result in more effective planning.
Niger: Strong Agricultural Season Boosts Economic Rebound in 2022 (World Bank)
Niger’s economy recovered strongly in 2022 after two years of weak growth. This is primarily due to a good agricultural season, thanks to favorable rainfall and an expansion of irrigated land. However, there are uncertainties and risks that could affect future growth, such as the security situation and climatic shocks. These are the findings of the World Bank’s latest economic update for Niger published today.
The report titled “Strengthening Financial Resilience of Pastoralists to Drought” (french) provides an overview of Niger’s economic situation and poverty levels in 2022 as well as the outlook for the next three years. The report also analyzes the potential of using disaster risk financing and insurance instruments for pastoralists to mitigate the adverse socio-economic impacts of climate shocks.
“Niger’s economy depends to a large extent on the livestock sector, which contributes almost 15% of the national GDP. However, this sector is significantly affected by climate shocks,” says Han Fraeters, World Bank Country Manager for Niger. “Disaster risk financing and insurance can play a crucial role in mitigating the adverse impacts of climate shocks on pastoralists, who constitute one of the poorest and most vulnerable populations. These communities face high levels of exposure to such shocks and encounter difficulties in managing and recovering from them.”
East African budgets update
EAC $103m budget focuses on infrastructure growth (The East African)
The East African Community is prioritising infrastructure development in the next fiscal year, signalling a break from a three-year lull blamed on the Covid-19 pandemic. The EAC on Tuesday tabled before the East African Legislative Assembly (Eala) budget estimates totalling $103,842,880 for 2023/2024, out of which 43 percent ($44 million), funded by development partners, will be used on infrastructure projects to spur intra-EAC trade, which increased by 13.4 percent to $74.03 billion in 2022 from $65.268 billion in 2021.
The earmarked infrastructure projects are meant to spur intra-EAC trade, which increased by 13.4 percent to $74.03 billion in 2022 from $65.268 billion in 2021.
“In 2022, EAC total exports to the rest of the world were valued at $20.139 billion, while total imports from the rest of the world into the EAC amounted to $53.891 billion,” said Dr Nibigira. Further, total Intra-EAC trade grew by 11.2 percent to $10.910 billion in 2022 from $9.810 billion in 2021.
East African nations to bolster their economies with bigger budgets (Moneyweb)
Kenya, Tanzania, Uganda, Rwanda and Burundi are all set to release their annual budgets on Thursday, providing details of their spending priorities and how they expect to fund them.
Most of the East African nations have already signaled that they will increase expenditure to shore up their economies against the fallout of Russia’s invasion of Ukraine and the continued aftermath of the coronavirus pandemic.
“Finance ministries in East Africa have little choice but to raise their spending as inflation means costs have continued to climb,” said Ben Hunter, an Africa analyst at risk advisory firm Verisk Maplecroft. “East African states sorely need more assistance from the global financial institutions now that access to capital markets has been curtailed for many. An expansion of concessionary lending will be crucial for achieving sustainable growth over the coming decade.”
Budgets: Will intra-regional trade spur nations growth? (The Citizen)
After the devastating Covid-19 and the impact of other global dynamics, will increased intra-regional trade boost growth in East Africa this time around? Four members of the East African Community (EAC) tabled their annual budgets for 2023/24 financial year on Thursday with optimism about recovery.
The finance ministers of Tanzania, Uganda, Kenya, and Rwanda presented their budgets in Parliament on Thursday with varying priorities.
A quick glance, however, saw infrastructure given much emphasis; as a key factor driving the economies.
According to the EAC Treaty, the Finance Ministers of the partner states are required to read their budgets simultaneously under a common theme. However, this has not yet worked perfectly with countries that joined the bloc recently, like the DR Congo.
Others, like Burundi and South Sudan, still subscribe to the old order of reading their budgets in tandem with the calendar year. As has been the case for many years, Kenya topped the six other EAC partner states in the size of its budget, being the largest economy.
Kenyan investors urged to take advantage of expansive EAC market to do business - KBC (KBC)
Kenyan investors and traders have been encouraged to seize the immense market opportunities presented by the East African Community (EAC) region to expand their businesses.
East African Legislative Assembly (EALA) MP Maina Karobia is in particular appealing to manufacturers to target the 300 million population of the EAC member countries in marketing their wares.
Speaking during the opening of the new Grand Maria Industrial Park in Thika, Kiambu County, the legislator said the regional assembly has enacted laws that make it easy for member states to do business.
The EAC, consisting of Kenya, Tanzania, Uganda, Rwanda, Burundi, and South Sudan, offers a sizable consumer base and a framework for regional economic integration, making it an attractive market for Kenyan businesses.
EAC budget insufficient, say lawmakers (The Citizen)
The budget estimates for the East African Community (EAC) tabled at the regional assembly last week may not achieve the desired targets. The $103 million would not suffice implementation of projects and operations of the regional body for 2023/24 despite a marginal increase compared to recent years.
“The absolute rise was not significant,” said Ms Fatuma Ndangiza, a member of the East African Legislative Assembly (Eala) from Rwanda. She told the House, currently holding a sitting here, that the budget increase this time around was partly due to admission of DRC Congo into the bloc. She argued that the regional organization needed “a higher budget allocation to meet its integration targets”.
Increased funding will not only cover routine operations of the EAC but finance an increasing number of projects being executed across the region. These include, among others, fast-tracking the single currency economy project (monetary union), infrastructure development and peace building.
Uganda’s ‘Optimistic’ Budget (The Independent Uganda)
Finance Minister, Matia Kasaija, on June 15 hit several optimistic notes for next Financial Year when announcing a Shs52.7 trillion budget. That is a 10% jump from the Shs48 trillion last financial year and the biggest rise in projected government expenditure since COVID struck in 2020.
Kasaija appeared determined to signal a return to pre-COVID-19 positivity by reeling off measure after measure to boost the economy and said the economy is projected to grow at a rate of 6% next FY and at an average of 6.5-7% per year over the next five years.
And many budget followers and experts appear to have bought into the government’s optimism. In post-budget reading interviews with The Independent, many said Kasaija’s planned revenue and expenditures are good.
“It is a good budget. Priority areas are very strategic and important for our country,” said Pamela Natamba, a partner at the PWC.
Martin Kyeyune, Chief Corporate Affairs Officer at Roofings Group said it is time for citizens to appreciate the role of paying taxes to help government deliver services. “Good investments in agriculture, industry, and service sectors would increase the basket in which URA has to pick taxes,” he said.
Imported smart cards for NIDA granted duty exemption (Daily News)
IMPORTED smart cards for the National Identification Authority (NIDA) are set to be cheaper after the government waived Common External Tariff (CET) to facilitate issuance of the national identity cards.
Presenting government budget estimates for 2023/24 financial year in Parliament on Thursday, the Minister for Finance and Planning, Mwigulu Nchemba said EAC member states had agreed to grant stay of application of EAC Common External. Tariff (CET) rate of 25 per cent apply a duty rate of zero per cent on imported smart cards by the National Identification Authority for one year in order to facilitate issuance of National Identification Cards.
He said the same applies to the rest of the East African Community (EAC) region as it is included in a list of goods for common tariff by member states in a pre-budget meeting held in May in Arusha.
New AfDB sponsored digital platform launched in Kenya to help farmers (Farmers Review Africa)
In a bid to save farmers from heavy losses as a result of erratic weather patterns due to climate change, a new digital platform has been launched to help Kenyan farmers access timely weather updates for proper decision making thanks to a Ksh114 million aid by African Development Bank (AfDB).
The Transformation Centres Digital Platform (KRTCDP) created by the Co-operative University of Kenya (CUK) aims at putting farmers at the centre of a single electronic “ecosystem” and connecting them with all the sectors in the agricultural value chain.
“The platform will help farmers in decision-making through access to agribusiness services and information such as the broadcast of agricultural-cycle information on weather forecasts, wholesale and retail commodity prices,” said Mr. Josphat Muhunyu, the Agricultural Secretary, State Department of Crop Development.
EAC rolls out campaign to grow agri-export trade (EAC)
The East African Community (EAC) has launched a campaign aimed at creating awareness on the agri-export trade opportunities that have been created through the EU-EAC Market Access Upgrade Programme (MARKUP). Through the campaign, small and medium-sized enterprises (SMEs) in the agricultural value chain, co-operatives and farmers, as well as government entities in the EAC will access information and tools on agri-export trade.
Speaking at the 14th June, 2023 launch of the campaign, Ms. Flavia Busingye, the Acting Director of Customs at the EAC Secretariat, said that MARKUP had created numerous trade opportunities for agri-SMEs in the region.
“The campaign ‘MARKUP: Growing agri-export markets’ aims to raise awareness of the opportunities in agricultural trade, and to demonstrate that international markets are within reach of East African exporters,” said Ms. Busingye.
Why East Africa farmer groups are opposing new seeds plan (The Citizen)
Farmer groups in East Africa say they will not relent in their opposition to a proposed seed and plant varieties bill. The draft East African Community (EAC) Seed and Plant Varieties Bill is being finalized at the EAC secretariat amid stiff opposition.
Although the EAC says if passed, it would improve access of farmers to improved seeds, non-state seed stakeholders maintain it would marginalise smallholder farmers. “It is more leaning towards stringent commercial seed and plant variety protection (PVP) laws,” said Emmanuel Justine, a programme manager with Eastern and Southern Africa Small Scale Farmers Forum (Esaff). This, he went on, will have massive impacts on smallholder farmers and their systems “including threats to agricultural biodiversity.”
The Joint Meeting of the Southern African Development Community (SADC) Committee of Ministers responsible for Transport, ICT, Information and Meteorology and Infrastructure met virtually on 16th June 2023 to discuss strategic policies and activities aimed at accelerating implementation of projects and programmes for regional Transport, ICT, Information and Meteorology Infrastructure.
In his remarks, Honourable Augustin Kibasa Maliba, Minister of Postal Services, Telecommunications, and New Information and Communication Services of the Democratic Republic of the Congo and Chairperson of the Joint Meeting of Committee of Ministers responsible for Transport, ICT, Information, and Meteorology and Infrastructure, emphasised the importance of consolidating their efforts to thoughtfully consider and review policies, strategies, programmes, and projects.
The Minister urged SADC Member States to address the challenges across all sectorial disciplines emanating from unstable universal socio-economic and political conditions, especially the Russia-Ukraine conflict, declining global economic growth, high rates of inflation, tight monetary and financial conditions, as well as the continued threats posed by the COVID-19 pandemic.
Ambassador Joseph Nourrice, the SADC Deputy Executive Secretary responsible for Corporate Affairs, representing the Executive Secretary of SADC, His Excellency Mr Elias Magosi emphasised that as infrastructure has intertwined linkages with other sectors, such as health, food security, and the environment, SADC Member States must be proactive in ensuring that these sectors develop in a complementary approach.
Ambassador Nourrice called for the development of climate-resilient infrastructure projects and urged Member States to develop innovative solutions and implement best practises that demonstrate resilience to combat adversaries.
Globalising African Voices on Illicit Financial Flows, Asset Recovery (The Gazelle News)
For over two decades, the issue of Illicit Financial Flows (IFFs) has been a major concern for the Africa as assets and funds running into billions of dollars continue to find its way out of the continent as a result of corrupt public servants and multinational corporations. Their destination is the Western and European countries.
Though stakeholders including the African Union Member-States have played significant roles in the international efforts to combat these opaque and destabilizing transfers of capital, such efforts have not yielded the desired goal.
Tackling corruption, particularly IFFs, has become a matter of survival for Africa’s development and must be treated with urgency. There is broad consensus that the funds being bled out of Africa, could be channeled towards the continent’s development if successfully retained. Former President of South Africa and the Chairman of the African Union High Level Panel on IFFs, Thabo Mbeki, has stated that the African Continent suffered an annual loss of over $50 billion as at 2015 through IFFs, which has grown to $80 billion yearly.
He had also called for the establishment of a globally inclusive intergovernmental tax body to strengthen global efforts against IFFs.
As part of measures towards addressing the IFFs in the Extractive Industries, the African Union (AU) High-Level Panel on Illicit Financial Flows (AU HLP on IFF) and the Working Group on the Common African Position on Asset Recovery (CAPAR) in collaboration with the African Union Advisory Board Against Corruption, Coalition for Dialogue on Africa (CoDA), Forum Civil, the Pan-African Lawyers Union (PALU) and TrustAfrica, held a conference in Dakar, Senegal.
The Conference, which has as theme “Addressing Illicit Financial Flows and Asset Recovery in the Extractive Industries”, was attended by policymakers, regulators, civil society organizations, industry stakeholders and the media. It was held on the margins of the 2023 Global Conference of the Extractive Industries Transparency Initiative (EITI) in Dakar, Senegal, which is the first ever EITI global conference to be held in Africa despite African countries being the majority among the EITI’s fifty-seven member states.
In an exclusive interview to ThePrint, the South African High Commissioner to India spoke out against the “domination” of the US Dollar (USD) in the world economy. He was not the first to question the USD being used as the world’s reserve currency for global trade.
According to media reports earlier this month, the President of Kenya, William Ruto, has called for African leaders to move away from using the USD for intra-Africa trade, and to support the pan-African payments and settlement system, launched in 2022. The reason for the movement gaining recent steam is the economic sanctions enforced by the US-European Union (EU), due to Russia’s operations in Ukraine.
Not just Africa, other global leaders from developing countries have also joined the call for the ‘de-dollarisation’ of trade — which means trade to be carried out between two countries in currencies other than the USD.
Afreximbank Pushes Ahead with Continental Payment System as Several Countries Join (Arise News)
A pan-African payment system that would allow African nations to trade among themselves, using their own currencies, is gaining momentum. The African Export-Import Bank expects 15 to 20 countries to have joined the Pan-African Payment and Settlement System (PAPSS) by the end of the year, Afreximbank President Benedict Oramah said in an interview ahead of the lender’s annual meetings in Accra, Ghana’s capital, that runs Sunday through June 21.The platform has started commercial operations with nine countries signed up so far, he told Bloomberg.
The system, known as PAPSS, is using dollar exchange rates for now, said Oramah, whose bank funds the system. “But we are working with central banks to develop an exchange-rate mechanism that would allow Africa’s 42 currencies to be convertible among themselves. What we are doing is to domesticate intra-African payments,” he said.
The vast majority of Africa’s intra-regional trade is done through conversions to the dollar. Initiatives like PAPSS and the African Continental Free Trade Agreement, which would create the world’s largest free trade zone by area, seek to boost internal trade by reducing barriers, including the need for intermediaries such as the US dollar.
The European Bank for Reconstruction and Development and the European Union representations in Morocco and the ECA Office for North Africa will hold on Friday 16 June in Rabat (Morocco) the first of a series of five training workshops for women-led businesses in various parts of Morocco.
These workshops are being organised as part of the EBRD-led “Women in Business” program financed by the EU and benefit from the support of multiple partners including the Moroccan Association of Women Entrepreneurs (AFEM) and the Association of Moroccan Exporters (ASMEX). They are also being organised as part of a series of actions undertaken by the ECA Office in North Africa aimed at the development of programs and policies in support to female entrepreneurship in North Africa and the implementation of an environment conducive to job creation for women and young people in North Africa.
The five workshops will focus on enhancing export capacity and building up the digital skills of about 200 women owners of small and medium-sized enterprises (SMEs). Besides supporting women in the Morocco labour market and their livelihoods, the project’s main objective is to strengthen Morocco’s trade with the African continent and support the country’s structural transformation.
Each workshop will address four key themes, namely access to finance, product development, market development strategies and the digitalization of SME export activities. Participants will learn about financing options available to SMEs, how to identify export opportunities, where are the potential markets in Africa, what are the qualification of exportable products as well as the latest digital platforms and tools that may boost exports.
North Africa to boost public-private partnerships to support economic development (AfDB)
“Diversifying the sources of funding for public infrastructure projects means seeking innovative approaches that integrate public-private partnerships in particular,” the Tunisian Prime Minister, Ms Najla Bouden, told participants of a seminar titled Public-Private Partnerships in North Africa for sustainable and inclusive growth that was held on 15-16 June in Tunis.
“North Africa has immense potential in terms of infrastructure development, which is essential for sustainable economic growth,” said Mohamed El Azizi, African Development Bank Managing Director for North Africa. “Given the investment and maintenance needs of infrastructure, PPPs offer a suitable approach to meeting the challenges facing African countries. However, we must recognize that PPPs are not without their shortcomings and pitfalls. Higher costs, complex contractual processes and potential monopolies are just some of the challenges we need to address diligently,” he warned.
The Generalized System of Preferences: How much does it matter for developing countries? (UNCTAD)
The Generalized System of Preferences (GSP) scheme is a voluntary trade measure implemented by developed countries that provide an advantageous, or “preferential”, tariff treatment to imports from developing countries.
Different national GSP schemes were introduced following a resolution adopted at the second session of the United Nations Conference on Trade and Development (UNCTAD) in 1968. The scheme is expected to contribute to developing countries’ export growth particularly in the manufacturing sector.
Five decades since its inception, the GSP stands at a crossroads. The effectiveness of tariff incentives as a tool to foster exports has eroded over time as trade liberalization processes proceed at multilateral, regional and unilateral levels, and as the relevance of tariffs to overall trade costs declines. The question arises as to whether the relevance and effectiveness of tariff preferences remain valid today.
Our Discussions at today’s panel were exceptionally constructive, as our main objective with this high-level event is to bring this very important discussion on CBDCs to Africa.
We agreed on the need to continue dialogue on CBDCs and to gather and share knowledge and information for the benefit of our member countries in Africa, the Middle East, and beyond. We also highlighted the value of enhancing our coordination efforts on the links between digitization, fintech and economic reform.
Harnessing the digital transition is also a key theme of our 2023 Annual Meetings.
In my remarks, I stressed that CBDCs could help to increase inclusion by giving more people access to financial services, and at a lower cost, strengthen the resilience and efficiency of payment systems, and make cross-border payments and remittances cheaper and quicker. However, if poorly designed, CBDCs could also lead to financial stability risks, data privacy and legal challenges, financial integrity and cyber risks, and central bank operational risks.
India’s Modi seeks African Union’s full membership in G20 (Reuters)
Indian Prime Minister Narendra Modi has written to the leaders of the G20 nations proposing the African Union be given full, permanent membership of the diplomatic group at its upcoming summit in India, an official source said.
Modi’s proposal to grant the African Union full membership in the G20 demonstrates India’s commitment to strengthening Africa’s representation and partnership in shaping global affairs, the source said. The G20 or Group of 20 is an intergovernmental forum of the world’s major developed and developing economies. The members represent around 85% of global GDP, over 75% of global trade, and about two-thirds of the world population.
“This will be a right step towards a just, fair, more inclusive and representative global architecture and governance,” the source said of the African Union proposal. “(The) prime minister is a strong believer in having a greater Voice of the Global South countries on international platforms, particularly of African countries.”
BRICS Expansion Can Wait, Strengthen the Core First (The Wire)
BRICS (Brazil, Russia, India, China and South Africa) is a relatively young organisation, established in 2009 merely on the economic prospects of constituents in the evolving and shifting global economic order. Its primary focus has been on economic cooperation, development and multilateralism. It is now seen as an alternative to the Bretton Woods model and other emerging economies are interested in joining it. The list of aspirants now stretches to eight ― Algeria, Argentina, Bahrain, Egypt, Indonesia, Iran, Saudi Arabia and the UAE. While some of these countries indeed have significant economic influence and regional importance, it is important to consider various factors before expanding BRICS.
The BRICS grouping is yet evolving as an organisation and needs time to develop its institutions and governance structure. Its constituents are evolving nationally, establishing robust governance and developmental institutions and exploring associated socioeconomic convergences. BRICS countries differ significantly in terms of economic development. China, with the sheer size of its economy, is challenging existing governance models and institutions while South Africa is still coping with structural economic challenges. India and Brazil remain attractive economically but Russia is cut off, financially and economically.
Recognising this diversity, BRICS members need to engage with each other to build frameworks for cooperation, explore areas of mutual interest and foster collaboration. Accordingly, BRICS countries should prioritise the strengthening of its New Development Bank (NDB) to promote financial and economic inclusion on a global scale. The NDB can play a crucial role in providing funding for infrastructure projects, sustainable development initiatives and other priority areas within BRICS countries and beyond. By enhancing its capacity, expanding its lending capabilities and ensuring efficient governance, BRICS can contribute to reducing the development gap and fostering inclusive growth.
Additionally, the idea of a BRICS currency for trade and internal payment settlements is worth exploring. A shared currency could facilitate trade and investment, reduce transaction costs and enhance economic cooperation within the bloc. However, implementing a common currency would require addressing issues such as exchange rate stability, monetary policy coordination and the establishment of appropriate financial infrastructure. It would also necessitate extensive dialogue and consensus-building among member states, especially on the basis of the intrinsic value of the currency. A currency-commodity basket would be a great idea, reflecting the intrinsic strengths of this currency for global acceptance, beyond internal settlement.
Agrifood systems must be part of the solution to the loss of biodiversity and the climate crisis facing our planet, the Director-General of the Food and Agriculture Organization of the United Nations (FAO), QU Dongyu, today told a meeting of G20 Agriculture Ministers.
“Despite progress, today we are facing alarming rates of biodiversity loss, jeopardising food security and nutrition, poverty eradication, prevention of natural disasters and climate change mitigation and adaptation,” Qu said in his address to a High-Level Ministerial Meeting on Sustaining Biodiversity and Ecosystem Services for Food Security, which took place in the Indian city of Hyderabad.
The FAO Director-General emphasized that we need genetic diversity to adapt agrifood systems to climate change, emerging pests, pathogens and changing ecological conditions; we need species diversity for diverse foods; and we need healthy ecosystems to provide water, regulate the climate and provide resilience against disasters.And yet, many drivers of biodiversity loss can be found in inappropriate agricultural practices.”My message is clear: agrifood systems must be part of the solution to the biodiversity and climate crises,” Qu said.
This means promoting improved practices that can help address trade-offs, maintain ecosystems, improve land and soil quality, reduce input use, and strengthen the resilience and adaptation capacity of farming systems to extreme weather events linked to climate change, Qu said.
Second Global Parliamentary Summit reaches historic pact against hunger and malnutrition (FAO)
The Second Global Parliamentary Summit against Hunger and Malnutrition closed on Friday in Chile with a new Global Parliamentary Pact to work towards the transformation of agrifood systems and to promote the right to adequate food for all.
“This event has demonstrated that the first meeting of parliamentarians in 2018 in Spain was not a coincidence. A process has begun today in Chile that will continue in other continents. The Food and Agriculture Organization of the United Nations (FAO) will continue to provide technical support to legislative actions that contribute to guaranteeing the right to adequate food”, said Mario Lubetkin, FAO’s Assistant Director-General and Regional Representative for Latin America and the Caribbean, welcoming the Pact at the Summit’s closing ceremony.
In the text, over 200 parliamentarians, 15 presidents and vice-presidents of national and regional parliaments and parliamentary bodies from 64 countries agree to commit themselves to work for a transition towards agrifood systems that are sustainable, inclusive, equitable, resilient and conducive to the realization of the right to adequate food for all.
Explainer: What is Russia’s problem with the Black Sea grain deal? (Reuters)
President Vladimir Putin said this month that Russia was considering withdrawing from the Black Sea grain deal as he accused the West of cheating Moscow because it still faced obstacles getting its own agricultural goods to world markets. Putin said he would discuss the future of the grain deal with visiting African leaders on Saturday.
The United Nations and Turkey brokered the Black Sea Grain Initiative last July to help tackle a global food crisis worsened by Moscow’s invasion of Ukraine and blockade of its Black Sea ports. It allows food and fertilizer to be exported from three Ukrainian ports - Chornomorsk, Odesa and Pivdennyi (Yuzhny). The deal has been extended three times, most recently until July 17.
The poorest in the world were hit worst by the rising global food prices. The U.N. World Food Programme (WFP) warned in March last year that its ability to feed some 125 million people was under threat because 50% of its grain came from Ukraine. Between 2018–2020, Africa imported $3.7 billion in wheat (32% of total African wheat imports) from Russia and another $1.4 billion from Ukraine (12% of total African wheat imports), according to the United Nations. The United Nations said last year that 36 countries count on Russia and Ukraine for more than half of their wheat imports, including some of the poorest and most vulnerable, including Lebanon, Syria, Yemen, Somalia and Democratic Republic of Congo. Under the Black Sea grain deal, more than 625,000 tonnes of grain has so far been shipped by the WFP for aid operations in Afghanistan, Ethiopia, Kenya, Somalia and Yemen. In 2022, WFP procured more than half its global wheat grain from Ukraine.
Guterres calls for phasing out fossil fuels to avoid climate ‘catastrophe’ (UN News)
“We are hurtling towards disaster, eyes wide open”, he said. “It’s time to wake up and step up.” Mr. Guterres was speaking to journalists at UN Headquarters following a meeting with civil society climate leaders from across the world.
He said limiting global temperature rise to 1.5 degrees Celsius is still possible but will require a 45 per cent reduction in carbon emissions by 2030. However, current policies will lead to a 2.8°C temperature rise by the end of the century, which “spells catastrophe”.
He called for immediate global action toward net-zero emissions, which “must start with the polluted heart of the climate crisis: the fossil fuel industry.”
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South Africa extends ban on scrap-metal exports by six months as it seeks to curb theft (Engineering News)
South Africa extended a ban on scrap-metal exports by six months as the government tries to combat theft and vandalism of public infrastructure.
Trade and Industry Minister Ebrahim Patel also ordered the International Trade and Administration Commission of South Africa to not accept or process any applications for export permits for ferrous and non-ferrous waste and scrap metal, according to a notice published in the Government Gazette on Thursday.
The theft and export of copper cables has had a severe impact on the economy and been a major contributor to power cuts and disruptions on rail lines. The ban was first proposed in August to combat illicit trade in these materials and was approved by cabinet in November.
Trade portal to bridge information gap among exporters (Monitor)
Information gap in the market has been listed as one of the challenges frustrating Ugandan exporters, according to the Ministry of Trade, Industry and Cooperatives.
Addressing exporters of fresh fruits and vegetables in Kampala on Wednesday, Ms Mary Amumpaire, the ICT officer at the Ministry, however, said a trade portal developed by the ministry can be used to relieve the exporters such frustration.
“The trade information portal ensures access to information needed to streamline the export process and fill the information gap,” she said. The portal, she argues “Is a platform providing access to fully transparent practical step-by-step guides to license, pre-clearance permits and clearance formalities for the most traded goods in and out of Uganda.”
South Sudan releases Ugandan maize, trucks one month later (Monitor)
The State Minister for Foreign Affairs, Mr Henry Okello Oryem, has said the South Sudanese authorities have released maize and trucks from Uganda, a month after they were blocked at the border.
Mr Oryem yesterday told Daily Monitor: “Our embassy continued to engage them [South Sudan government] and our lorries have all been released and they have come back to Uganda since Wednesday. They were forced to come back with the maize and their consignment, but we wonder why because UNBS [Uganda Bureau of Standards] has got higher standards than theirs.”
The South Sudan National Bureau of Standards (SSNBS) impounded 62 trucks loaded with maize grains, maize flour, and wheat on May 15 on allegations of failing to pass the test for contamination with aflatoxin. Ugandan traders and officials protested the move.
Tunisia sees huge potential for enhancing trade, investment ties with China (Xinhua)
Tunisian trade officials and business leaders on Thursday highlighted the huge potential for enhancing the North Africa country’s trade and investment relations with China.
“This would be possible and achievable given the potential in the fields of green technology, renewable energy, pharmaceuticals, construction and infrastructure, health, tourism and technological and digital innovation,” Salma Elloumi, first vice-president of Confederation of Citizen Enterprises of Tunisia (CONECT International), told a Tunisia-China economic and commercial meeting held in the Tunisian capital of Tunis.
“We should also explore the possibilities of increasing professional exchange between Tunisian and Chinese companies,” Elloumi said.
Statistics presented during the meeting showed that the trade volume between Tunisia and China reached about 763 million U.S. dollars in the January-April period in 2023, an increase of 12.5 percent from the same period last year.
Jalel Tebib, director general of the Foreign Investment Promotion Agency (FIPA), noted that China is Tunisia’s 4th largest commercial partner in the world and its largest partner in Asia. In 2022, China was Tunisia’s second largest supplier, he added.
São Tomé and Príncipe Accedes to the Establishment Agreement for Afreximbank’s Fund for Export Development in Africa (FEDA) (Afreximbank)
The Fund for Export Development in Africa (FEDA), the development impact-focused subsidiary of the African Export-Import Bank (Afreximbank), has announced that Democratic Republic of São Tomé and Príncipe has become the latest country to sign the FEDA Establishment Agreement.
The accession to the agreement, achieved under the guidance of Prime Minister Patrice Trovoada of São Tomé and Príncipe, demonstrates the country’s support for Afreximbank’s efforts to broaden FEDA’s effectiveness by mobilizing its Member States to sign and ratify the FEDA Establishment Agreement and to support the organization’s impact investing objectives.
New memberships broaden the scope of FEDA’s interventions and underpin the Fund’s dedication to its mission of delivering long-term capital to African economies with a focus on industrialization, intra-African trade and value-added exports.
4 more countries sign up for $25bn Nigeria-Morocco pipeline project (Vanguard)
Four more countries have signed up for the 5,000Km Nigeria-Morocco gas pipelines project estimated to cost about $25 billion to construct.
The project which is an extension of the West African Gas pipeline now has 13 countries on board. The new countries which signed a memorandum of understanding at the ECOWAS Secretariat on Friday are Republic of Benin, Guinea, Liberia and Ivory Coast.
They join Nigeria, Morocco, Ghana, Senegal, Gambia, Guinea Bissau, Sierra Leone, Togo and Mauritania for the multi-billion dollar pan-African project expected to deliver about four billion cubic feet of gas daily when fully operational.
AfCFTA provides opportunity for companies to export to all of Africa-Manake (News Invasion)
The Assistant Minister of Trade and Industry, Beauty Manake, says the African Continental Free Trade Area (AfCFTA) is an opportunity for local companies to export and expand their market within the African continent following the agreement to eliminate trade barriers in order to boost intra-Africa trade.
Manake said this while paying a courtesy call to the management of Chloride Exide Botswana (CEB) in Phakalane yesterday.
For her part, the Acting Director of the Department of Trade Development, Johanna Segotlong, said Botswana Investment and Trade Centre (BITC) and Financial Assistant Policy had contributed tremendously to the success of CEB locally by securing work permits for the Company’s skilled battery manufacturing, engineering and financial personnel.
She added that more importantly, through the export promotion of CEB’s products into the SADC market, the policy will enable the Company to become a predominately export based company over a short period.
India’s economic focus in Kenya pivots, as Asia eyes the market potential of East Africa’s 312 million people (Business Insider Africa)
Asian countries are expected to boost their investment in Kenya during the next years, according to the United Asian Network, the organization that unites all Asian nations. India would target the bigger EAC region, which has an estimated market of 312 million people, with its increasing investments.
Speaking on the sidelines of the week-long conference commemorating 75 years of India’s independence, UAN Chairman Bimal Kantaria said they will assess the contribution from a variety of angles. As a result, Asian countries will be able to plan their investments in a way that will have the biggest impact.
“Over the next five to ten years IT is going to be very important, service industry, agriculture, millet, and some of these big investments that we are talking about are going to be the future of India’s investment into the country,” said Kantaria.
India has become Kenya’s third-largest trading partner, according to the Economic Survey 2023. According to the report, India is the third-largest source of imports, although the value of items sent to Kenya fell to Sh230.9 billion last year from Sh250 billion the year before. The majority of the trade volumes sent to Kenya throughout the year were valued at 69.1% of their value from the Asian continent.
East African budgets for 2023/24
EAC finance ministers table 2023/24 Budgets (The East African)
East African Community (EAC) countries expect overall national government spending to rise in the upcoming financial year (July 1 to June 30).Kenya, Tanzania, Uganda, and Rwanda are to present their 2023/2024 budgets before their respective parliaments on Thursday. According to the EAC Treaty, finance ministers of the partner states read their budgets simultaneously, under a common theme.
The exemptions are Burundi, South Sudan and latest entrant the Democratic Republic of Congo.
Kenya’s National Treasury and Planning Cabinet Secretary, Njuguna Ndung’u, a former central bank governor, will present his maiden Ksh3.6 trillion ($25.75 billion) budget for 2023/24, a 6.5 percent increase from the Ksh3.38 trillion ($24.18 billion) the previous year.
In Tanzania, the Minister of Finance and Planning, Dr Mwigulu Nchemba, will read his third budget of $19.23 billion (Tsh44.38 trillion), up seven percent from Tsh41.48 trillion ($18 billion).
Uganda’s $13.9 billion (Ush52.74 trillion) budget is being presented by Finance minister Matia Kasaija who has held the post since March 2015. The government has increased its spending plan by Ush4.606 trillion ($1.2 billion) from Ush48.13 trillion ($13 billion) in 2022/2023.
Dr Uzziel Ndagijimana Rwanda’s Minister of Finance and Economic Planning, appointed in 2018, is presenting a Rwf5.03 trillion ($4.4 billion) budget. Kigali has increased its spending plan by 5.6 percent from Rwf4.67 trillion ($4.1 billion) the previous fiscal year.
Manufacturers handed mixed bag in ‘Hustlers’ budget (People Daily)
Treasury Cabinet Secretary Prof Njuguna Ndung’u budget offered a mixed bag of goodies for local manufacturers and investors eyeing Kenya with a raft of proposals that will cushion some but hit others hard.
The CS proposed an extension of the exemption to locally purchased machinery for used by pharmaceutical companies to be exempt from VAT on importation. He however proposed the introduction of excise duty on imported sugar at the rate of Sh5 per kilo excluding the sugar imported or purchased locally by registered pharmaceutical manufacturers for use in the manufacture of pharmaceutical products.
State slashes tax on imported rice, wheat to increase supply (Nation)
The East African Community (EAC) has allowed Kenya to reduce import duty levied on rice and wheat to rates below the bloc’s common external tariff to help address the high food prices in the country.
Rice imported from countries outside the region will now be subject to a custom duty of only 35 per cent, instead of the 75 per cent charged under the EAC common tariff, while wheat from outside the region will be taxed at 10 per cent, instead of EAC’s rate of 35 per cent.
National Treasury Cabinet Secretary Njuguna Ndung’u said the move will help meet the domestic demand of rice and wheat in efforts to bring down the high food prices Kenyans are currently grappling with.
IMF, World Bank fingerprints on Kenya’s $26bn Budget (The East African)
Treasury Cabinet Secretary Njuguna Ndung’u on Thursday read his first Budget speech that had fingerprints of the International Monetary Fund (IMF) and the World Bank, a signal that President William Ruto is keen to implement the stringent conditions that came with loans from the Bretton Woods institutions. The 129-page Budget speech sought to explain the motivation behind the far-reaching revenue
Agro-industrialisation budget boosted (Monitor)
Uganda’s agro-industrialisation programme has received a boost with government increasing allocations from the Shs1.449 trillion last year to Shs1.787 trillion in the 2023/24 budget read yesterday by Finance minister Matia Kasaija.
The increase means the sector will account for 3.37 percent of the total Shs52.7 budget.
Following government’s shift to programme-based-budgeting in 2021, agriculture was allocated a cumulative total of Shs3.1 trillion; Shs1.67 trillion in 2021/22 and Shs1.453 trillion in 2022/23. In 2021/22, attention was focused on projects aimed at increasing commercialisation and competitiveness in agricultural production and agro-processing. These included; developing commodity value chains between farmers and the market; building regional warehouse storage capacities; providing affordable long-term agricultural financing and insurance and development of infrastructure to enable the private sector take advantage of export market opportunities.
The government plans to transform Uganda’s agriculture through agro-industrialisation, one of the programmes in 2021/25 NDP III. The objective is to increase total export value of processed agricultural commodities from; $935 million in 2020 to $2.7 billion; increase the agricultural sector growth rate from 3.8 to 6.0 percent, among others.
Ms Kirabo said the planned focus on agro-industrialisation should ensure access to credible inputs like seeds, acaricides and pesticides. “Let us stop looking at the increased figure. We should dig deep. Each year the population grows at 3.2 percent, meaning those are more mouths to feed. Does the increment cater for that?... Countries like our neighbour in Kenya know their staple food is maize flour and in their budget they already know what amount of grain they will import which is not the case with our budget,” she said.
Museveni roots for value addition in agriculture (Monitor)
President Museveni looked the picture of health as he appeared on Zoom yesterday to rally Ugandans behind the push for value addition which will make Uganda’s exports more competitive on the world market. This policy shift will help the country claw back billions lost to trading in unprocessed goods, he enthused.
Speaking after Finance minister Matia Kasaija had read the 2023/2024 national budget, Museveni states: “The Import substitution value of these industrial products is about $3.6 billion and they are bringing into the country as export earnings $1.6 billion,” he said to the audience gathered at Kololo Ceremonial Grounds.
Mr Museveni said desired levels of growth will be achieved through collective action, with lawmakers and other leaders getting behind wealth creation initiatives like Emyooga and the Parish Development Model.
Rwanda abolishes customs tax on imported electric, hybrid vehicles (Xnihua)
Rwanda has abolished import taxes on electric vehicles, as well as vehicles that utilize both electricity and petroleum products (hybrids), including electric motorcycles, to encourage the adoption of electric vehicles and contribute to a cleaner and greener future, Minister of Finance and Economic Planning Uzziel Ndagijimana has said.
“To expedite the adoption of electric vehicles and mitigate emissions associated with petroleum-based transportation, imported electric cars, hybrid cars, and even imported electric motorcycles will be exempt from customs taxes,” the minister said Thursday while presenting the 2023-2024 fiscal year budget to the Rwandan parliament.
In a related development, Ndagijimana announced that the government has decided to charge lower customs duties compared to those imposed at the East African Community (EAC) level on a wide range of imported commodities such as rice, sugar, cooking oil, and fish, to make these important and essential goods more affordable for Rwandans.
Regional MPs call for action as EAC faces high trade deficit (The New Times)
The East African Community (EAC) is grappling with a significant trade deficit, with its import bill far surpassing its export revenues, according to data from the bloc.
This concerning situation highlights the urgent need for increased efforts to boost economic output and improve the livelihoods of its citizens, as emphasized by members of the East African Legislative Assembly (EALA).
During the EALA plenary on June 13, the Chairperson of the Council of Ministers, Ezéchiel Nibigira, presented the budget estimates for the EAC’s financial year 2023/2024. He disclosed that the total trade within the EAC had increased by 13.4 percent, reaching $74 billion in 2022 compared to $65.2 billion in 2021.
However, Nibigira further revealed that the region’s total exports to the rest of the world amounted to $20.1 billion in 2022, while its imports from the rest of the world exceeded $53.8 billion. These figures indicate that the EAC is predominantly a net importer, resulting in a high trade deficit.
Exploiting natural gas can be a win-win for both Africa and Asia – Experts (AfDB)
Against the backdrop of the Russia-Ukraine conflict and its impacts on food and fuel prices worldwide, representatives of the private and development sectors attending an online conference organized by the African Development Bank expressed consensus that exploiting Africa’s natural gas resources offered benefits for both African and Asian countries.
The African Development Bank’s Asia External Representation Office and its African Natural Resources Management and Investment Centre jointly organized the event, titled “A New Vision for Africa: Asia-Africa Cooperation on Natural Gas.
It aimed to spur exploration of the challenges facing global natural gas markets, including inadequate long-term investments, climate change risks and energy security concerns.
Nosizwe Nokwe-Macamo, Executive Chairman and Founder of Raise Africa Investments Pty Ltd, raised the issue of energy poverty in Africa. She said: “we have challenges on the supply side, and we’ve got huge challenges as well on the demand side.” She emphasized the urgent need for reliable and affordable energy sources.
Dr. Vanessa Ushie, Acting Director of the African Development Bank’s African Natural Resources Investment and Management Centre, called for a balancing of short to medium term opportunities for Africa to meet rising energy demand from Asia, against longer term climate change and energy transition risks. “Africa needs to move on the value chain. This is our strategic approach for all commodities, including natural gas.” She also underscored the importance of exploring inclusive and sustainable long-term solutions that are of benefit to both regions.
Food and fertilizer trade to Africa may be hampered, depending on the decision Putin makes (Business Insider Africa)
A team of African leaders is set to visit Ukraine and Russia starting this week to bring Russia’s 16-month-long war to a conclusion, and Putin has stated that he intends to discuss the Black Sea grain agreement. According to a draft framework paper seen and reported by the American news agency, Reuters on Thursday, African leaders may potentially propose to Putin an “unconditional grain and fertilizer deal.”
The Russian president, on Tuesday, noted that Russia was considering withdrawing from the Black Sea grain effort, which the United Nations and Turkey negotiated in July of last year because its grain and fertilizer supplies are being hampered. The agreement might expire on July 17.
According to Vincent Magwenya, spokesperson of South African President Cyril Ramaphosa, Putin and Ukrainian President Volodymyr Zelenskiy agree on the “importance of grain deliveries to Africa for the alleviation of food insecurity.”
In remarks to reporters on Thursday, U.N. Secretary-General Antonio Guterres expressed his hope that the discussions between Russian President Vladimir Putin and the leaders of Africa would result in “a positive outcome with regard to the Black Sea initiative, as well as with regard to the efforts that we are making for the exports of Russian food and fertilizer.
Although Russia’s food and fertilizer exports are not subject to the harsh sanctions the West has placed on it because of the war, Moscow claims that limits on payments, logistics, and insurance present obstacles.
Africa endowed with productive marine ecosystems to spur Blue Economy (KBC)
Experts now say Africa’s ecosystems, teeming with a robust biodiversity, are well placed to ensure realization of the aspirations of growth in the continent’s Blue Economy industry especially as envisaged in the African Union Agenda 2063.
The acting Director of the African Union – InterAfrican Bureau for Animal Resources (AU-IBAR) Dr. Nick Nwankpa says that the African continent is well endowed with productive ecosystems to provide resources for sustainable livelihoods, food security and wealth.
Speaking at the Knowledge Fair organised by the ECOFISH Programme in partnership with the African Union InterAfrica Bureau for Animal Resources (AU-IBAR) and the Inter-Governmental Authority on Development (IGAD), AU-IBAR official noted that despite the crucial role that ecosystems play in socio-cultural and economic development, Aquatic biodiversity and ecosystems are highly threatened by unsustainable exploitation and “other practices that risk continued supply of ecosystem services.”
With the blue economy concept coming in to promote the sustainable use of aquatic resources for economic growth, improved livelihoods and jobs, and the enhancement of aquatic ecosystem health, AU-IBAR says that the African continent has instituted various efforts towards developing the various sectors of the blue economy with the Africa Blue Economy Strategy (ABES) as one of the measures aimed at realizing the envisaged goals.
The strategy themed “Developing a sustainable blue economy; increasing momentum for Africa’s Blue Growth”, has the objective of guiding the development of an inclusive and sustainable blue economy that becomes a significant contributor to continental transformation and growth through: “advancing knowledge on marine and aquatic biotechnology; environmental sustainability; the growth of Africa-wide shipping industry; the development of sea, river and lake transport; the management of fishing activities on these aquatic spaces; and the exploitation and beneficiation of deep-sea minerals and other resources.”
Barbados to host first global supply chain forum in May 2024 (UNCTAD)
UNCTAD and the Government of Barbados will hold the first Global Supply Chain Forum in the country’s capital, Bridgetown, from 21 to 24 May 2024.
Government officials, business leaders and experts will explore how to promote development through sustainable and resilient transport and logistics, improved connectivity and trade facilitation.
“To help resolve the current cascade of global crises and prepare for the future, we need shipping and supply chains to be more efficient, more resilient and far greener,” UNCTAD Secretary-General Rebeca Grynspan said. “Strong, resilient and predictable supply chains will be critical to help developing countries manage the ongoing impact of the poly-crisis,” said Matthew Wilson, ambassador of Barbados to the United Nations in Geneva.
He said the forum will offer countries a platform to create solutions that support climate change adaptation, food security and economic growth.
Trillions Wasted on Subsidies Could Help Address Climate Change | World Bank Report
Trillions of dollars are wasted on subsidies for agriculture, fishing and fossil fuels that could be used to help address climate change instead of harming people and the planet, a World Bank report says.
The report, Detox Development: Repurposing Environmentally Harmful Subsidies, says global direct government expenditures in the three sectors are $1.25 trillion a year—around the size of a big economy such as Mexico. To subsidize fossil fuel consumption, countries spend about six times what they pledged to mobilize annually under the Paris Agreement for renewable energies and low-carbon development.
The report notes that government subsidies of $577 billion in 2021 to artificially lower the price of polluting fuels, such as oil, gas, and coal, exacerbate climate change, and cause toxic air pollution, inequality, inefficiency, and mounting debt burdens. Redirecting these subsidies could unlock at least half a trillion dollars towards more productive and sustainable uses.
Pricing emissions from shipping: Where should the money go? (World Bank Blog)
The backbone of worldwide trade, international shipping moves more than 80 percent of global trade by volume. As a result, international shipping accounts about three percent of global greenhouse gas emissions. Unless shipping moves to zero-carbon fuels and innovative technologies to green its energy footprint, the latest estimates suggest that carbon emissions will grow by 90-130 percent by 2050, as compared to 2008 levels.
The International Maritime Organization (IMO), a UN agency, aims to cut those emissions as soon as possible, with a goal of halving them (as compared to 2008 levels) by 2050. Member states are currently revising shipping’s climate ambition to set a course consistent with the temperature goals of the Paris Agreement.
To do that, the IMO is focusing on energy efficiency, new zero-carbon fuels and technologies, and ways to make these changes cost effective and equitable for countries. Putting a price on carbon emissions is one way to do that. A carbon tax sets a price on carbon and can help reduce GHG emissions and generate revenue. Estimates show that, in shipping alone, putting a price on carbon could raise $40 to $60 billion dollars each year between 2025 and 2050.
A climate finance goal that works for developing countries (UNCTAD)
After years of failing to meet climate finance commitments, the new climate finance goal under discussion this week in Bonn is critical, but without supporting reforms of the global financial architecture we risk repeating past mistakes.
This goal will replace the climate finance commitment set in 2009, which aimed to mobilize $100 billion per year for developing countries by 2020. The $100 billion commitment, which in any case has not been met, will expire in 2025.
It’s commonly understood that the $100 billion goal is a fraction of what is needed to support developing countries to achieve climate goals in accordance with the Paris Agreement.
In the United Nations Framework Convention on Climate Change’s recent analysis of financing needs, developing countries require at least $6 trillion by 2030 to meet less than half of their existing Nationally Determined Contributions.
UNCTAD outlined four priorities at an event entitled “Options for Scaling Climate Finance” co-hosted with the German development agency GIZ and The Energy and Resources Institute at the Bonn Conference on 6 June.
Top MDBs collaborate to accelerate the circular economy (The Manila Times)
THE world’s leading Multilateral Development Banks (MDBs) are stepping up their cooperation to promote the circular economy. The banks announced their combined effort at the World Circular Economy Forum (WCEF2023) in Helsinki.
“Until now, financing for circular economy projects has remained marginal. Now we want to change that. Developing the capacity and tools for the proper assessment of circular economy investment will require collaboration between financial institutions. The financing of innovation is particularly important to support the emergence of circular economy solutions,” said Ambroise Fayolle, vice president of the European Investment Bank (EIB).
It is difficult for a single company to gain financing because, in the circular economy, value is created in value chains made up of several companies. Companies may also use new business models or technologies that investors consider risky.
The MDBs that agreed during WCEF2023 to tighten their cooperation aim to increase the share of impactful circular economy projects in their financing. Banks see the potential of the circular economy in achieving economic success in their target countries and in improving the ability of economies to respond to unexpected challenges and changing circumstances.
Members address financial inclusion, transport and logistics during services week (WTO)
WTO members discussed transport and logistics services, as well as financial inclusion, at two events organized on 13 and 14 June under the aegis of the Council for Trade in Services and the Committee on Trade in Financial Services respectively. They reviewed exemptions to the WTO’s most favoured nation (MFN) principle at a dedicated Council meeting on 12 June as well as other issues. A webinar organized on 13 June as part of the “Simply Services” series looked at the impact of decarbonization on transport services.
In the Services Council, members also addressed implementation issues from the 12th Ministerial Conference (MC12) related to WTO reform and pandemic response, the Least-Developed Country (LDC) Services Waiver — which seeks to boost the participation of LDCs in services trade — and the E-commerce Work Programme. Also under consideration were various concerns reiterated by members regarding measures affecting trade in services.
High-level panel urges action on triple planetary crisis at Trade and Environment Week (WTO)
Trade policy must be urgently and collectively wielded to address the triad of environmental problems posed by climate change, pollution, and biodiversity loss, a high-level panel of speakers said at the fourth edition of Trade and Environment Week held on 12-16 June at WTO headquarters in Geneva. The week featured 18 sessions centred around the theme of collective approaches in addition to a meeting of the WTO’s Committee on Trade and Environment (CTE).
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Nigeria Finance Act 2023: Increased taxes and import levy aim to boost revenue (Nairametrics)
The Finance Bill 2023 which was signed into law on 28 May 2023 by former President, Muhammadu Buhari imposes an 0.5% levy on goods imported into Nigeria from outside Africa. This is in addition to current custom duties and other approved charges.
Beyond the additional import levy of 0.5%, the bill has amendments to the following tax laws, among others: Customs, Excise Tariff, Etc (Consolidation) Act, Petroleum Profits Tax Act (PPTA), Value Added Tax Act (VATA), and Public Procurement Act. The Act seeks to provide support for the funding of the 2023 budget through an improvement in the tax administration.
The country’s fiscal position remains constrained due to poor revenue generation capacity, especially oil revenue. Non-oil revenue projections for 2023 will likely be surpassed in our view especially with the provisions of the finance act.
Despite the growing concerns about the multiplicity of taxes, the new Finance Act 2023 introduces new taxes while increasing some of the existing tax rates. The penalty for various infractions and tax offences for companies operating within the downstream petroleum sector was also increased.
Bridging gender data gaps for inclusive development in Mozambique (UNECA)
Mozambique is making significant progress towards achieving the Sustainable Development Goals (SDGs) by prioritizing gender data collection. The government recently hosted a series of workshops and meetings aimed at strengthening gender statistics in the country.
The primary objective of the CB-GenSMS project is to improve the availability of reliable data, which is crucial for designing evidence-based policies that promote gender equality and women’s empowerment across Africa.
Recognizing the importance of comprehensive data for policymaking, the Mozambican government has taken proactive measures to ensure its availability. This includes the publication of the report "Men and Women in Mozambique" and the upcoming release of the Demographic and Health Survey (DHS).
To assess progress, identify challenges, and inform policy formulation, Mozambique produces periodic reports aligned with important frameworks such as the Beijing Platform for Action and the United Nations Convention on the Elimination of All Forms of Discrimination Against Women (CEDAW).
Despite these advancements, the country still faces gender data gaps in crucial development areas, requiring targeted policies and focused attention.
AfFCTA cannot prosper without vibrant Zim: AfDB (The Herald)
African Development Bank (AfDB) president Dr Akinwumi Adesina believes development partners need to “walk with” Zimbabwe at the time the country is reeling under the heavy burden of illegal economic sanctions.
Dr Adesina revealed this at a meeting to discuss Zimbabwe’s arrears clearance and debt resolution held during the AfDB’s annual meetings in Sharm El Sheikh, Egypt.
During the session, Zimbabwe’s Government, led by President Dr Emmerson Mnangagwa, briefed the bank group’s governors on the ongoing Structured Dialogue Platform with the country’s s creditors and development partners.
Why digitalisation is crucial to Nigeria, Africa’s supply chains (The Guardian Nigeria)
To meet increasing demands for goods and services in Nigeria and other African cities, Regional Head of Integration and Business Growth, Maersk, Mr. Darryl Judd, has charged the Nigerian government and leaders across the continent to improve investment in modern digital solutions to tackle emerging inefficiencies in supply chains.
Judd, who spoke, yesterday, on ‘Logistics 4.0: Accelerating Africa’s Digital Revolution’, on the sidelines of the Africa CEO Forum in Abidjan, explained that with COVID-19 disruption of the market in Nigeria and others, there was need to build resilience through integration of digital solutions to help supply chains function.
Africa contributes about $2.7 trillion to the global economy from 54 countries that are part of the African Continental Free Trade Area (AfCFTA).
However, intra-African trade only corresponds to 14 per cent of the total trade, owing to high tariff and non-tariff trade costs. For instance, agriculture contributes to 15 per cent of Africa’s Gross Domestic Product (GDP) and 60 per cent of Africa’s employment. The use of mobile apps, digital payments and an increase in e-commerce are levers that could improve intra-African trade from agricultural produce and substitute imports.
Findings show that it is more expensive to ship goods from South Africa to Nigeria due to supply chain complexities. A major challenge in Nigeria and the continent’s logistical sector is delay, due to various customs regulations, poor road networks, slow processing and clearance of goods, and inadequate storage. But Judd said these could be eliminated through improved digital technology.
He said digital solutions, like block chain initiatives, trade lane, artificial intelligence and others would provide needed visibility of the market.
With Delivery of Free Fertilizer to Nigeria, Moscow Recalibrating its African Strategy (Modern Diplomacy)
Moscow has embarked on soliciting full-fledged support for its ‘special military operation’ in neighbouring Ukraine by offering ‘no-cost delivery’ of grains and fertilizers promised by Russian President Vladimir Putin. Putin has reiterated that deliveries to ear-deafening applause during the last inter-parliamentary conference Russia-Africa held in March.
Foreign Minister Sergey Lavrov made this one of the core content of his speech during his last trip to South Africa through Kenya to Burundi and Mozambique in southern Africa. Malawi and Kenya have recieved their consignments. Moscow intends to deliver a shipment of Russian fertilizers to Nigeria free of charge in the near future, Foreign Minister Lavrov said at a press briefing in Burundi.
“Last September, President Vladimir Putin announced that we were ready to deliver 300,000 tons of our fertilizers, illegally seized in EU ports, to African countries free of charge. Fully in line with colonial practices and habits, the EU leadership blocked this initiative. It took us 6 months to get, at least, the first shipment of 20,000 tons to Malawi, and just recently another shipment of a similar amount of fertilizer was delivered to Kenya. The same shipment is scheduled to go to Nigeria soon,” he stressed in his speech in Bujumbura, capital of Burundi.
Russia, Algeria To Agree “Expanded Strategic Partnership” (Russia Briefing News)
Abdelmadjid Tebboune, the Algerian President is currently on a state visit to Russia, that is expected to culminate in the signing of an “Expanded Strategic Partnership” between the two countries. Algiers has been showing an interest in working more closely with Moscow and other leading non-Western players, and has confirmed its readiness to join the BRICS group later this year. Algeria could become Russia’s outpost in North Africa and a partner in the global gas market.
In terms of market size, Algeria has the tenth-largest proven natural gas reserves globally, is the world’s fourth-largest gas exporter, and has the world’s third-largest untapped shale gas resources. It also ranks sixteenth in proven oil reserves and exports about 60% of its total energy production.
Stanislav Mitrakhovich, of Russia’s Financial University and the National Energy Security Fund, said that “Algeria is one of the largest gas suppliers to the EU, and European politicians have been trying to convince it to increase gas supplies. However, domestic consumption in Algeria is also growing and increased production demands large-scale investments. Algeria will increase LNG [liquified natural gas] supplies but the situation is more complicated with pipeline exports:
Mitrakhovich added that “Under current conditions, Russia could offer Algeria, if not complete market sharing, at least assistance in coordinating issues concerning priority export destinations and counteracting attempts by Western countries to introduce gas price limit mechanisms, as well as in handling discrimination by European politicians against gas as an energy resource. Russia also has proposals for Algeria on nuclear energy and agriculture.”
Current Russia-Algeria bilateral trade is worth about US$1.65 billion with the vast majority of that being Russian exports to Algeria, although that, in light of enhanced energy cooperation, may change.
Fresh sugar tax locked to imports in revised budget (Nation)
Consumers and industrialists may get relief if Parliament approves a proposal to shelve a new excise tax charge on sugar and confectionery.
The Treasury, in its Finance Bill 2023, has proposed to charge a Sh5 excise tax per kilogramme of sugar and Sh42.1 per kilogramme of locally manufactured confectionery, which could increase the consumer prices of the sweetener.
The Finance and Planning Committee of the National Assembly, however, proposes that the excise taxes would only apply to imported sugar and confectionery, shielding consumers from higher prices of the commodity and safeguarding the competitiveness of millers and manufacturers of sugar-based products.
"The proposal to impose excise duty (Sh42.1 per kilo) on locally-manufactured confectionery will drive several local companies out of business as it will make them uncompetitive and their products unaffordable. This move will eliminate the competitiveness of the local confectionary industry against imports as the retail prices will increase due to the excise duty cost that will be passed on to the consumers," said the KAM in reaction to the Finance Bill 2023.
"It will also erode the competitiveness of locally produced confectionery products in regional export markets such as Tanzania and Uganda, where similar proposals to make local confectionary excisable were rejected after lawmakers assessed the negative impact on the industry."
EAC launches campaign to promote agricultural exports (The Standard)
The East African Community (EAC) has unveiled a new campaign aimed at raising awareness about trade opportunities in agricultural exports through the EU-EAC Market Access Upgrade Programme (MARKUP).
The campaign, titled MARKUP: Growing Agri Export Markets, will provide valuable information and resources to small and medium-sized enterprises (SMEs) in the agricultural value chain, co-operatives, farmers, and government entities across the region.
Speaking at the campaign launch, the acting director of trade at the EAC Flavia Busingye highlighted the significant trade prospects for agri-SMEs. She emphasised the campaign’s objective of showcasing that international markets are within reach for East African exporters.
Ms Busingye acknowledged the challenges faced by SMEs in the agriculture sector, including limited access to market information, cumbersome customs procedures, and poor connectivity, particularly when it comes to accessing markets outside the EAC.
The Economic Community of West African States (ECOWAS), in collaboration with the United Nations Development Programme (UNDP) and the International Trade Centre (ITC), organized a regional capacity building workshop for Master Trainers from Business Associations on the African Continental Free Trade Area (AfCFTA) from 6 – 8 June 2023 in Abuja – Nigeria.
In her remarks, Madame Massandjé TOURE-LITSE, the ECOWAS Commissioner for Economic Affairs and Agriculture, highlighted the need for West African businesses to take advantage of the opportunities provided by the African continental market. She reiterated the commitment of the ECOWAS Commission to support the Private Sector to unlock investment, boost production and promote business linkages. Finally, she urged network of Trainers to accompany Micro, Small and Medium Enterprises (MSMEs), especially women and youth entrepreneurs, to start trading under the AfCFTA.
During the 3-day workshop, participants from Business Associations were trained on key elements of export readiness, including export market research, export strategy, as well as operational tools of the AfCFTA. The Masters Trainers were empowered to sensitize businesses on the benefit of the AfCFTA and help them start trading in the continental market.
Africa unbanked population threatens eco-stability (Tanzania Daily News)
Over 350 million adults in Africa are unbanked and primarily excluded from the formal economy, relying heavily on cash or informal providers for their financial needs, which is costly, risky and leaves them vulnerable to economic instability. This is according to AfricaNenda annual report, an African-led institution that is working to unlock the potential of inclusive digital financial services on the continent.
The institution’s interventions aim at reducing vulnerability to economic shocks by those excluded from the financial system, particularly women in rural areas.
AfricaNenda Chief Executive Officer (CEO), Dr Robert Ochola, said the need for a more inclusive society is becoming increasingly urgent. “…One of the fastest ways to achieve this is by putting in place systems that expand access to financial services and leave no one behind. Instant and inclusive payment systems can play a pivotal role in creating universal access to financial services for all Africans,” he said.
AfricaNenda launched the first State of Instant and Inclusive Payment Systems in Africa (SIIPS) report last year. The report offered a comprehensive view of Africa’s current instant payment systems landscape, revealing that more intentional and dedicated focus is needed to build the inclusivity of instant payment systems in Africa.
Maximizing green hydrogen production, export in Africa urgent: Mohieldin (Ahram Online)
UN Climate Change High-Level Champion for Egypt Mahmoud Mohieldin speaks during a session on positioning Africa as a global hub for green hydrogen held at the Africa CEO Forum in Abidjan on Wednesday.
Mohieldin, who is also the UN special envoy on financing the 2030 Sustainable Development Agenda, made the remarks on Wednesday during a session on positioning Africa as a global hub for green hydrogen held at the Africa CEO Forum in Abidjan, Ivory Coast.
The climate champion noted that African countries have promising national and regional initiatives in the field of green hydrogen, but regulatory frameworks and working principles are needed to overcome related challenges.
Mohieldin emphasized the importance of increasing demand for African green hydrogen from neighbouring countries and regions, particularly Europe. He added that Africa must also enhance the quality of green hydrogen production infrastructure, increase storage capacity and support supply chains.
Critical-mineral deals made up 66% of top 40 M&A in 2022 – PwC report (Bizcommunity)
The findings of this year’s report capture major themes and developments impacting the industry, especially the impact of the energy transition, which will shape the industry over the coming two decades. Miners will have to navigate the increasing role governments — and new players like automobile companies — are playing in the sector, while simultaneously ensuring they are well-positioned for the clean energy transition — which requires access to resources.
“Mining is playing a fundamental role in underpinning the global transition to clean energy, but the path ahead is rocky," says Paul Bendall, global mining leader, Mining & Metals, PwC Australia.
Critical minerals dominated deal activity in 2022 as miners raced to capitalise on the global transition towards clean energy, driven by two forces. First, the role many of these minerals play in the clean energy transition technologies, such as batteries, electric vehicles, and solar and wind generation. Second, the role of critical minerals in national defence, technologies and weaponry.
Africa’s minerals and energy potential: A modern-day ‘gold rush’ (ZAWYA)
When we examine the energy and resources sector on the African continent, there are two fascinating dynamics unfolding. If they both come to fruition, it will have a massive multiplier effect for the prosperity of the continent.
The first is the rise of battery metals or green minerals that include the likes of lithium, nickel, cobalt, copper, manganese and graphite, inter alia - all of which are abundant on the continent. Mozambique, South Africa, Tanzania, Zimbabwe, and the DRC are rich in these minerals and potentially provide a significant windfall for local miners and governments.
For context, South Africa holds 80% of the worlds manganese deposits, was the second largest producer of world palladium (at 80MT) in 2022, to date SA has supplied over 75% of the world’s platinum, and to date has supplied over 40% of the world’s gold, amongst other minerals. Zimbabwe is estimated to have the world’s seventh largest lithium deposits, while Mozambique, Madagascar, and Tanzania are all in the top 102 global reserves for graphite.
Importantly, discussions have recently moved beyond extracting for short-term profits to beneficiation for longer-term benefits. This includes employment, skills development, local shareholding, and support of corporate and social investment initiatives that uplift surrounding communities and shared value.
If one considers that the United Nations Economic Commission for Africa (UNECA) recently highlighted that nearly 70% of Africa’s exports are unprocessed commodities, it is a non-negotiable that there is a focus on creating an enabling environment to encourage mineral beneficiation and processing.
Visa launches new programme to accelerate Africa’s digitization (Ahram Online)
The announcement was made by Visa Executive Chairman Alfred F. Kelly Jr. at the event organized by Bloomberg New Economy Gateway Africa in Marrakech, Morocco.
The Visa Africa Fintech Accelerator will enable up to 40 startups per year to accelerate and grow through a three-month intensive learning program focused on business growth and mentoring. The launch of the Africa Fintech Accelerator program follows Visa’s recent pledge to invest $1 billion in Africa’s digital transformation and its long-term commitment to advancing Africa’s economies and driving inclusive growth.
Fintech startups across Africa can become part of the programme through an annual application process, beginning July 2023, that involves two phases.
“Africa has one of the most exciting and admired fintech ecosystems in the world, bringing outstanding entrepreneurial talent to a young digital-first population that is growing fast”, Kelly noted
Tunisia takes part in Third China-Africa Economic and Trade Expo (ZAWYA)
Some twenty Tunisian companies operating in the trade and industry sectors will be taking part in the third China-Africa economic and trade expo, to be held from June 29 to July 2 in Changsha, in central China.
African and Chinese businesspersons, experts and representatives of international financial institutions and chambers of commerce will be taking part in this event, which aims to strengthen Chinese-African cooperation, the Ministry of Commerce and Export Promotion said on Wednesday.
A China-Africa trade index will be published for the first time during this third expo. It will serve as a barometer for companies engaged in business and trade cooperation with their African partners.
How the Mena region is reshaping trade for the future (Global Trade Review)
The Middle East and North Africa (Mena) is undergoing a transformation, reclaiming its historical position at the heart of global commerce while simultaneously embracing the digital, sustainable and inclusive future. As corporates seek support from their banking partners to navigate this changing landscape, cutting-edge solutions are emerging to cater to their evolving needs.
Trade in Mena has long been synonymous with hydrocarbons, with the region’s vast natural resources underpinning its rapid economic growth for decades. However, recent years have seen a significant shift in the trade landscape, as governments embark on ambitious economic diversification initiatives to spur the development of new industries, such as technology, manufacturing, and renewable energy.
This transformation is driving a wave of innovation and entrepreneurship, as businesses across the region look to capitalise on emerging opportunities and adapt to the changing demands of global markets.
India-Africa Trade Needs To Realise Its Full Potential, Says Union Minister Piyush Goyal (Outlook India)
Union Minister of Commerce and Industry Piyush Goyal, while addressing the 18th CII-EXIM Bank Conclave on India-Africa growth partnership today in Delhi, said that India never works with any country with an expansionist approach. Instead, he said that India treats countries like a brother. Speaking at the event, Goyal said, "India is the 5th largest investor in Africa and we don’t intend to take over your ports, railways, etc. We don’t follow expansionist approach.”
He also highlighted the strong India-Africa trade which stands at around $100 billion. "India-Africa trade is growing at a healthy 9-10 per cent rate," Goyal said. Moreover, the commerce minister stressed on the need to ensure that trade between India and Africa is able to reach its true potential.
Highlighting the goal of taking India-Africa trade to $200 billion, Goyal said that Indian companies are looking for many more opportunities in Africa. "We will be delighted to partner with our African friends in helping develop your economies and create more jobs," Goyal said.
The EU’s landmark carbon tool presents major catch-22 for Africa (African Arguments)
To turn the tide on climate change, it is essential that high-emitting regions of the world take urgent action. However, not all climate action is made equal. Poorly designed policies can end up doing more harm than good.
We recently conducted a study into the European Union’s Carbon Border Adjustment Mechanism (CBAM), which will enter into force in its transitional phase in October 2023. The aim of the regulation is to reduce the risk of so-called “carbon leakage” whereby EU-based companies relocate their emissions-intensive operations to countries with weaker climate policies.
This is one of the EU’s landmark climate policies. Yet a study by the UN’s trade and development body UNCTAD that modelled the effects of CBAM found that the policy would reduce global emissions by a mere 0.1% (at a carbon price of $44/tonne) to 0.16% (at a carbon price of $88/tonne).
Our study found that CBAM’s economic repercussions will be far-reaching – and most strongly felt in Africa. Based on a carbon price of €87 ($94) per tonne (at the time of writing, the EU price of carbon was €88 per tonne), our modelling forecasts that the CBAM could reduce the continent’s GDP by 0.91%. This is equivalent to a fall of $25 billion at 2021 levels of GDP. Some of Africa’s least developed countries – including The Gambia, Mauritania, and Mozambique – will be especially hard-hit according to our projections.
Related tralac infographic: The European Union’s Carbon Border Adjustment Mechanism
How developing countries can measure exposure to the EU’s carbon border adjustment mechanism (World Bank Blog)
In less than three years, the European Union will require importers of certain carbon-intensive goods to pay for their products’ embodied carbon emissions. The policy, known as the Carbon Border Adjustment Mechanism (CBAM), could have a significant impact on the competitiveness of countries that export these goods to the EU – developing countries in particular. To help them prepare, the World Bank developed the CBAM Exposure Index.
When it takes full effect in January 2026, the CBAM will cover a limited number of the most carbon-intensive goods – including aluminum, cement, electricity, and iron and steel. Some developing countries export large quantities of these goods to the EU. Zimbabwe, for example, is a major exporter of iron and steel to the EU, and Ukraine sells large quantities of fertilizer to the bloc. In later years, the CBAM will likely be expanded to cover additional carbon-intensive goods.
DG welcomes the Head of Government of Togo, Victoire Tomegah Dogbe, to the WTO (WTO)
Director-General Ngozi Okonjo-Iweala welcomed the Prime Minister of Togo, H.E. Ms. Victoire Tomegah Dogbé, to the WTO on 15 June. They discussed the ongoing work of the WTO, Togo’s economic diversification, and how trade can deliver for the African continent, especially in the context of the Africa Continental Free Trade Area (AfCFTA).
The Director-General also urged the Prime Minister and her Government to quickly deposit Togo’s instrument of acceptance of the Fisheries Subsidies Agreement, noting that Africa is a victim of the illegal, unreported and unregulated fishing. The benefits of the new Agreement include, amongst other things, the combatting of illegal, unreported and unregulated (IUU) fishing and fishing of overfished stocks whilst at the same time safeguarding the livelihood of artisanal fisherfolk. Those subsidies would be prohibited once two-thirds of the WTO’s membership has accepted the Agreement.
New tariff scheme for imports from developing countries to go live on Monday – and other updates (Institute of Export and International Trade)
A new set of tariffs for imports from developing countries into the UK will enter force on Monday (19 June).
The Developing Countries Trading Scheme (DCTS) replaces the UK Generalised System of Preferences – the continuity system that was put in place following the country’s departure from the EU.
The government has issued an FAQ document to support traders prepare for the requirements that will be introduced as part of the new scheme, including those relating to the documentary evidence that needs to be provided to claim lower duty rates on imports under the scheme.
The Hidden Wealth of Nations: Groundwater’s Critical Role in a Changing Climate (World Bank)
Groundwater is vital to economic activity and growth, food security, socioeconomic development, and adapting to the impacts of climate change. But the sustainability of this critical resource is at risk in many regions, partly because it is not valued appropriately and is taken for granted. In the context of global pressures on food systems and water supply, policymakers need to act now to ensure groundwater is managed responsibly across sectors depending on this resource.
Groundwater is our most important freshwater resource—particularly in times of drought. As climate change advances, policymakers need to understand better and manage this critical asset. A new World Bank report considers the economic value of groundwater, the costs of misusing it, and the opportunities to leverage it more effectively.
The report, titled The Hidden Wealth of Nations: The Economics of Groundwater in Times of Climate Change, demonstrates how groundwater can safeguard food security while boosting economic growth and job creation. However in most cases, this resource has been undervalued and overexploited, with insufficient regard for its long-term sustainability.
the new report offers fresh data and evidence that with the right policies in place, we can maximize the benefits of groundwater harvesting—both now and long into the future.
Members address LDC concerns, transparency at Rules of Origin Committee meeting (WTO)
At its meeting on 6 June, the Committee on Rules of Origin (CRO) considered initiatives to address the concerns of least developed countries (LDCs) regarding the use of preferential rules of origin, transparency in the use of non-preferential rules of origin, and improvements to the functioning of the committee.
Members considered a submission from the LDC Group setting out a proposed report that the committee would submit to the General Council ahead of the WTO’s 13th Ministerial Conference, due to take place in February 2024, describing the work of the CRO.
As drafted, the report could describe progress, lessons learned and best practices on use of preferential rules of origin from the point of view of LDCs, and possibly note areas of divergence with preference-giving members. The report would cover the different paragraphs of the 2015 Nairobi Ministerial Decision on Preferential Rules of Origin for Least Developed Countries by drawing and distilling from the previous and future LDC submissions.
The world food import bill is forecast to reach a new record this year, though it is predicted to grow at a much slower pace compared to last year, as rising world prices, driven by higher quotations for fruits, vegetables, sugar and dairy products, dampen demand, especially in the most economically vulnerable countries, according to a report released today by the Food and Agriculture Organization of the United Nations (FAO).
FAO’s Food Outlook estimates that the global food bill will rise to $1.98 trillion in 2023, up 1.5 percent from 2022. It rose by 11 percent in 2022 and 18 percent in 2021.
While food imports by advanced economies continue to expand, the import bill for the group of Least Developed Countries (LDCs) is predicted to decline by 1.5 percent this year and that for net food-importing developing countries (NFIDCs) to decline by 4.9 percent, according to FAO.
“The decline in food import volumes is a concerning development in both groups, suggesting a decline in purchasing capacity,” the biannual report from FAO’s Markets and Trade Division warns. “These concerns are amplified by the fact that lower international prices for a number of primary food items have not, or at least not fully, translated into lower prices at the domestic retail level, suggesting that cost-of-living pressures could persist in 2023.”
In case you missed it
Report on the State of Integration of the Common Market for Eastern and Southern Africa (COMESA)
This report highlights developments and status of the regional integration process in COMESA since the 21st Summit held in November 2021, Cairo, Egypt. The report covers key achievements, challenges & constraints and proposed way forward.
It notes that under trade liberalization, membership to the COMESA Free Trade Area remained at 16 states with the four countries the DR Congo, Eritrea, Eswatini and Somalia at different stages of full liberalisation.
The value of COMESA’s total exports to the world significantly increased by 56% from US$ 100 billion in 2020 to US$ 156 billion in 2021. The sectors that contributed to this increase were manufactures, fuels, ores and metals and food,” she said.
The value of Intra-COMESA total exports increased by 28% from US$ 10 billion in 2020 to US$ 13 billion in 2021. Key exports include palm oil, cement, copper ores and concentrates, beet/cane sugar, live animals and petroleum oils.
BUSA/TRACIT calls for improved measures to combat illicit trade in South Africa (Busa)
A new study by the Transnational Alliance to Combat Illicit Trade (TRACIT) shows that illicit trade is one of the biggest threats to stability and economic growth in South Africa. While the country has taken steps under President Ramaphosa to root out illegal trade and associated activities like corruption and money laundering, the scope and depth of the illicit economy poses a significant threat to the health and wellbeing of South African citizens and a persistent drain on the overall economy.
It is critical that the South African Government prioritizes efforts to combat illicit trade and the underlying conditions that facilitate it,” said TRACIT Director of Programs Esteban Giudici. “Left unaddressed, illicit trade and its associated criminal activities will continue to rob the government of essential tax revenue and deter investments in the country.”
To encourage an effective policy response to illicit trade, the TRACIT report Organized Crime, Corruption and Illicit Trade: Spotlight on South Africa calls for strengthening interagency and inter-departmental cooperation between South African law enforcement agencies; strengthening criminal penalties; appointing an Interagency Anti-Illicit Trade Coordinator; ramping up implementation of enforcement measures; and increasing transparency and cooperation between the public and private sector to improve enforcement actions.
Report: Organized Crime, Corruption and Illicit Trade: Spotlight on South Africa
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tralac Daily News
Rising global demand for South African vegetables (FreshPlaza)
The National Agricultural Marketing Council hosted a workshop on South Africa’s fresh produce chain today in which economist Thabile Nkunjana provided an overview of recent broad trends in international trade and its impact on South African fresh produce. The fresh produce sector has been at the mercy of international turbulence and climate-related problems, made more complex by recent trade restrictions.
“As of March 13, 2023, at least 22 countries have implemented 26 export bans on certain food, ten countries had implemented 14 export limitation measures, affecting specifically onions, potatoes, fruit, and other processed food,” he noted.
Africa remains the largest buyer of South Africa’s vegetable exports, taking almost two-thirds (64%) of vegetables – dominated by onions and potatoes – in 2022.Asia and the Middle East accounted for 10% of South Africa’s vegetable exports, while the share of the European Union is a significant 22%.
“The interesting thing is that from the European Union, because of high energy prices affecting greenhouse production and their vegetable supplies, we’re seeing opportunities there, at least in the short-term, for South African fresh produce.”
The European Union’s Green Deal will have an increasing impact on its trading partners (and it remains South Africa’s largest market for fruit).
UK competes with Europe for South African citrus (Fresh Plaza)
The early citrus season has been characterized by a strong pull from Europe. “Everyone believes EU prices will be better than prices in the UK this season – even though it’s easier to export to the UK – so we’re all trying to maximise our EU volumes,” comments a Western Cape packhouse manager who asks not to be named.
“We’re just hoping that prices on soft citrus remain strong. There are guys who have in the past sent a ‘rough’ class 2 and might be tempted to pack that 5% less strict this year because the European market is empty,” he adds. “There is the temptation to maximise exports now that the market is empty, and after the difficult few years we have behind us.”
In his latest newsletter the Citrus Growers Association CEO Justin Chadwick noted that last year South Africa had overall supplied 7% of Europe’s oranges, with the bulk (87%) from its own orchards in Spain, Italy and Greece.
“If South African fruit was not available over that time, EU consumers would have little oranges available, forcing the consumer to shift to alternative fruit categories.”
Western Cape moves to woo the US as trade tensions rise (BusinessTech)
The Western Cape Government (WCG) has prioritised protecting the Africa Growth and Opportunity Act (AGOA) shared between South Africa and the United States as tension and talk of punishing South Africa’s Russian ties reaches a fever point.
On 13 June, the New York Times reported that a group of influential congressmen had written to US national security and foreign relations officials calling for South Africa to no longer be the host country for the AGOA conference as well as raising questions regarding South Africa’s position in the Act.
As a result of the possible economic headwinds this could bring to the surface, Western Cape premier Alan Winde is leading a delegation of the WCG to the US intending to further promote trade and investment with the province.
Kenya’s restrictions leave Uganda stuck with 24m litres of milk (The East African)
Uganda says Kenya’s restrictions on importing dairy products has left Ugandan processors stuck with 24 million litres of milk.
The Dairy Development Authority (DDA) said that while Nairobi has not imposed a ban, it is limiting the issuance of permits needed to access its market. “It is not like Kenya has issued a formal ban, but this is through a refusal of import permits, which is a requirement for access to the market,” said Dr Samson Akankiza Mpiira, the acting Executive Director of DDA.
Agriculture Permanent Secretary Maj-Gen David Kasura Kyomukama said besides promoting local consumption through school milk-feeding programme, the government will export to other countries due to Kenya’s restrictions.
“Those who are slow in clearing imports from Uganda are playing with fire. They buy maize from our gardens,” he added.
Kenyan tea exports take 26pc hit from Sudan war (The East African)
Kenya’s tea export dropped 26 percent in the first quarter of the year, taking a hit from the civil unrest in Sudan. Sudan, which is among the top five export destinations for Kenyan tea, has already seen the volumes shipped to the destination decline by 59 percent with traders projecting less imports by Khartoum in the coming months should the civil strife continue.
The Tea Board of Kenya says the total volumes exported in the review period was 99.8 million kilogrammes, a drop from the 135 million kilos recorded in the corresponding period last year. “Lower export volumes were due to less imports by Pakistan, Egypt and Sudan owing to challenges of forex reserves affecting these markets,” said the directorate.
Traders have lamented that it is becoming difficult for tea to access the Sudan market because of the challenges caused by war, which has cut demand for the beverage and posed a logistical nightmare for shippers.
New rice sorting technology to boost quality, productivity (The Citizen)
Rice processing in the country has received a boost following the introduction of a new processing technology known as Colour Sorter. The Colour Sorter machines have the ability to sort out unwanted solid materials using higher-resolution sensors, leaving the rice grains clear and of high quality.
The technology is an initiative of a Japanese company called Satake, which has entered into an agreement with local processors for supply and maintenance. Processors say they are optimistic that the rice sorting technology will open more export markets to Tanzania-produced rice, whose quality has been the stumbling block.
The Director of Mechanization and Irrigation in the Ministry of Agriculture, Ms Anna Mwangamilo, encouraged farmers to grow more rice to help the government achieve the 2019–2030 National Rice Development Strategy (NRDS) phase II.
“The aims of NRDS are to sustain rice self-sufficiency, contribute to regional self-sufficiency, be a rice market leader, and be well positioned to become competitive through improvement of quality, quantity, and value of the produced rice,” she said yesterday. In recent years, rice yield has risen, but quality has remained a challenge. The main goal of NRDS II is to make Tanzania sufficient and a major exporter of rice to the East Africa Community (EAC) and the Middle East.
Ngozi Okonjo-Iweala, Director-General, World Trade Organisation: Interview – Nigeria Economy (Oxford Business Group)
Nigeria has forged closer trade ties with other countries since 2000, particularly with China and India. After the Covid-19 pandemic, trade levels rose substantially. However, Nigeria is still dependent on the export of raw materials and should diversify its economy to integrate further in global value chains.
Nevertheless, Nigeria has the will and the power to diversify and profit from the opportunities that trade offers, particularly in the region. The African Continental Free Trade Area (AfCFTA) is key in this respect, but it will require further liberalisation and trade facilitation to increase productivity and investment. Free trade zones (FTZs) are equally critical, as they provide support to trade through increased competition, economies of scale, investment incentives and better resource utilisation. FTZs, however, must be properly equipped with infrastructure and allowed to function as intended. Another critical tool is special economic zones to spur exports, thereby promoting economic growth by incentivising specified sectors and industries.
To ensure that Nigeria and the rest of Africa reap the benefits of AfCFTA, it will be important to have a strategy that addresses both tariff and non-tariff barriers, and cuts trade costs, which for African countries are the equivalent of a 304% tariff on average. Africa should aim to double its share of world trade within the next decade by adding more value to its products and becoming part of global value chains.
The World Trade Organisation’s responsibility is threefold: to keep markets transparent, open and equitable. By reducing trade barriers, countries like Nigeria can benefit from predictable access to other markets, and the protection and guarantees that a rules-based, multilateral trading system offers.
Gov’t eyes 50% increase in green investments during FY2024/2025: Planning min. (EgyptToday)
As part of its Vision for 2030, the Egyptian State believes in the vital role of green investments for promoting inclusive growth, creating more jobs, and ensuring environmental sustainability, Minister of Planning and Economic Development Hala El-Said said.
Under the Fiscal Year 2024/2025 investment plan, the State targets a 50 percent increase in the share of green investments, added the minister in a speech delivered on her behalf by Heba Shaheen, Executive Director of the Egyptian Initiative for Business Climate Reform “Irada,” during a conference on empowering businesses for green economic development.
As part of a structural reform program, the government took several important steps to create an environment conducive to green investments by rolling out more incentives for the private sector, she said.
Caribbean Export signs three MoUs to support increased trade between Caribbean and Ghana (CNW Network)
Last Tuesday, June 6, 2023, there was a significant gathering of government officials, business leaders, and trade experts at the first leg of the Caribbean-West Africa Trade mission to Ghana.
Hosted by the Caribbean Export Development Agency (Caribbean Export), the mission aimed to foster collaboration and explore emerging areas for trade and investment opportunities between Ghana and the Caribbean.
Benjamin Dzoboku, Managing Director of Republic Bank Ghana PLC, and Mr. Gerald Nsomba, Specialist Trade, and Corporate Finance with Afreximbank, also shared their perspectives on the significance of the Ghana-Caribbean partnership and their efforts to support SME development along with trade and business opportunities between the regions.
The signing of Memoranda of Understanding (MoUs) took place between Caribbean Export and prominent Ghanaian organizations, including the Private Enterprise Federation, Ghana Union of Traders Association, and Ghana National Chamber of Commerce and Industry (GNCCI). These MoUs aim to foster closer collaboration and enhance trade relations between the Caribbean and Ghana, exploring potential partnerships for joint activities and facilitate businesses in key sectors such as renewable energy, agriculture technology and ICT.
Việt Nam, Côte d’Ivoire to promote agriculture, trade cooperation (Việt Nam News)
Việt Nam and Côte d’Ivoire will strengthen cooperation in agriculture, and facilitate each other to promote the trade of cashew, cotton and cocoa, among others.
The statement was made during talks between National Assembly Chairman Vương Đình Huệ and President of Côte d’Ivoire’s National Assembly Adama Bictogo held yesterday during the latter’s visit to the country.
Emphasising Việt Nam’s increasing position in the international arena, President of Côte d’Ivoire’s National Assembly Adama Bictogo said Việt Nam is a model of success, resilience, an example and an inspiration for many countries in the fight against poverty and underdevelopment.
The two sides agreed that economic-trade cooperation is one of the pillars of cooperation between the two countries, on the basis of cooperation for mutual benefit and development.
The two sides agreed to create maximum convenience for the products that are strengths of each country to penetrate each other’s markets.
China expands Africa investment to boost trade cooperation (Global Times)
China will expand investment in Africa with various measures in a bid to strengthen economic and trade cooperation between the two sides, Chinese officials said on Tuesday. The remarks were made at a press conference held by the Ministry of Commerce and the Hunan provincial department of commerce. The Central China province is to hold the third China-Africa Economic and Trade Expo from June 29 to July 2 in Changsha, capital of Hunan.
Representatives from 50 African countries and eight international organizations have registered to attend the expo. China is willing to sign or update investment promotion and protection agreements and elimination of double taxation agreements with these countries to improve the level of liberalization and the facilitation of trade and investment cooperation, said Deputy Commerce Minister Li Fei at the press conference.
China will continue to encourage domestic firms to strengthen cooperation in China-Africa industry and supply chains by relying on trade cooperation zones in Africa, and China will also organize various exhibition platforms to further tap the potential of the two sides, Li added.
How instant payments in Africa boost development (New Business Ethiopia)
Over 350 million adults in Africa are unbanked and primarily excluded from the formal economy, relying heavily on cash or informal providers for their financial needs, which is costly, risky and leaves them vulnerable to economic instability.
This is according to AfricaNenda, an African-led institution that is working to unlock the potential of inclusive digital financial services on the continent. The institution’s interventions aim at reducing vulnerability to economic shocks by those excluded from the financial system, particularly women in rural areas.
In its inaugural annual report, AfricaNenda highlights its work and achievements to accelerate implementation of more inclusive payment systems across Africa by removing barriers to instant and inclusive payments, accelerating access to digital payments and mobilizing the continent’s digital financial ecosystem for inclusive growth.
The CEO of AfricaNenda, Dr. Robert Ochola said: “Today, the need for a more inclusive society is becoming increasingly urgent. One of the fastest ways to achieve this is by putting in place systems that expand access to financial services and leave no one behind. Instant and inclusive payment systems can play a pivotal role in creating universal access to financial services for all Africans.”
New white paper focuses on the cross-border payments dilemma in the SADC (ZAWYA)
With a population spanning almost 400 million people across 16 countries, the Southern African Development Community has the widest-reaching regional bloc in Africa, holding massive appeal for trade exchanges to strengthen economies and benefit communities. However, unlocking this potential to enable a seamless and regulated flow of money across borders has been one persisting challenge that requires solving.
A new white paper, ‘SADC Regional Payments Interoperability – exploring the value of mutual digital infrastructure to drive more formalised, accessible and inclusive payments in the region’, by BankservAfrica together with Cenfri, explores the region’s cross-border payments landscape.
“With exciting innovations and new product launches, payments is an exciting space in the region. However, these fall short of the one critical need: broad-based and all-to-all interoperability. The ability for money to flow from wallets to bank accounts inexpensively enhances inclusivity, reduces pain points and can encourage the move from cash and informal money send. Achieving this is key to solving the cross-border payments dilemma in the SADC,” explains Ruhling Herbst, Executive Head: Africa Business Development at BankservAfrica.
The biannual meeting of the Southern African Development Community (SADC) Development Finance Institutions (DFI) Subcommittee was held on 9th June 2023 at the Swakopmund Hotel and Entertainment Centre in Swakopmund, Namibia to review progress on the implementation of Annex 9 of the SADC Protocol on Finance and Investment.
In her opening remarks, Honourable Mrs. Hinda-Mbuende Deputy Minister of Finance and Public Enterprises of the Republic of Namibia pointed out the economic downturn and challenges, recent global COVID-19 Pandemic and international geo-politics that have negatively impacted the SADC integrated development agenda which created and continues to create challenges for respective Member States, in terms of providing critical support to DFIs.
Hon. Hinda-Mbuende appealed for a greater consideration and action required by DFIs in terms of innovative, agile and strategic alignment amongst others with the likes of other development partners, financial technology (Fintech) and green climate finance mechanisms, to strengthen the balancing act while executing the development mandate.
EAC tables US$103,842,880 Budget Estimates before EALA for the 2023/2024 Financial Year (EAC)
The East African Community (EAC) has tabled before the East African Legislative Assembly (EALA) the budget estimates for the 2023/2024 Financial Year totaling US$103,842,880 for the 2023/2024 Financial Year.
Hon. Amb. Dr. Ezéchiel Nibigira, said that the budget estimates for the Financial Year 2023/2024 were being presented at a time when the EAC economies were experiencing global shocks arising from the on-going Russia-Ukraine war, tight global financial conditions, lingering effects of Covid-19 and the impact of climate change.
“Despite these challenges, economic growth in the region improved to 4.8 percent in 2022 from 3.5 percent in 2021. The strong growth in the region was supported by the good performance of the industry, services, construction, mining and manufacturing sectors,” said Dr. Nibigira.
Hon. Nibigira projected a positive outlook for EAC economies, largely driven by the strong performance of the services sector, prudent government policies and increased public and private investment.
Hon. Nibigira disclosed that the EAC total trade increased by 13.4 percent to US$74.03 billion in 2022 from US$65.268 billion in 2021. “In 2022, EAC total exports to the rest of the world were valued at US$20.139 billion, while total imports from the rest of the world into the EAC amounted to US$53.891 billion. Further, total intra-EAC trade grew by 11.2 percent to US$10.910 billion in 2022 from US$9.810 billion in 2021,” said the Minister.
“The major Intra-EAC traded products are cereals, cement, iron and steel, live animals, petroleum products, sugar, foods and beverages, which signify that our economies are agro-based with good signs of moving to industry-based.”
On priorities for the 2023/2024 FY, Hon. Nibigira said that the Community would focus on nine (9) priority areas, including harmonisation of trade related policies, laws and regulations, and streamlining of customs and trade facilitation systems for increased trade and investment
2022 Africa Sustainable Development Report (AfDB)
Building Back Better from the Coronavirus Disease (COVID-19) while Advancing the Full Implementation of the 2030 Agenda for Sustainable Development
The Africa Sustainable Development Report (ASDR) for the year 2022 comes at the midway of the implementation of the 2030 Agenda for Sustainable Development to which world leaders, including African leaders, made commitments in 2015, to end extreme poverty, inequality and climate change by 2030. In addition, the ten-year implementation plan of the African Union’s Agenda 2063, titled, “the Africa We Want,” that was initiated in 2013, ends in 2023. This report is also paramount because it covers the period when the Covid-19 pandemic and the Ukraine-Russia crisis emerged with significant bearing on the implementation of both agendas.
It tracks the performance of all African countries using latest data and highlights critical areas that require urgent policy interventions. The report also provides a benchmark with which to assess the scale of the impacts of both shocks on the SDGs. Overall, African countries need to invest in building and strengthening the capacities of national statistical offices for better and timely collection of highly disaggregated data that tracks the implementation of the SDGs and Agenda 2063.
New partnerships and sources of development financing are required to meet the rising needs of future development in Africa. Both regional development banks, as well as the Bretton-Woods institutions, need to urgently step up their efforts to boost their financial support to African countries. African governments should aim to strengthen domestic resource mobilization through accelerating digitalization, improving tax policy and administration, curbing illicit financial flows, and creating the enabling governance, legal and judicial frameworks for enhanced accountability, transparency, and participation.
ICYMI: African Food Systems Can Produce $1trn In Value – AfDB (The Tide News Online)
African Development Bank (AfDB) President, Dr. Akinwumi Adesina, has said African food systems have the potential to produce $1 trillion in value over the next seven years.
Addressing the ongoing Eighth Africa Agribusiness and Science Week (AASW) in Durban, South Africa, Adesina said, “Working with development partners from around the world and the AUC, the private sector companies, and global and national agricultural research centers, we developed Food and Agricultural Delivery Compacts for 41 countries”.
According to him, partners to the summit have built on its success, mobilising $72 billion so far, to support the national compacts.
pdf Keynote by Dr Akinwumi Adesina (10.76 MB)
FARA’s Chairperson, Alioune Fall, spoke about the interlocking relationship between climate change and agricultural production. “Climate change and its effect on the continent require new ways of doing things in almost all facets of our society”, he said, adding: “Africa’s young farmers would not adopt nature-based approaches unless they are well packaged, affordable and technology-serviced”.
US still committed to keeping Africa trade ties – US-Africa Leaders Summit rep (Eyewitness News)
The special presidential representative for the United States (US)-Africa Leaders Summit, Johnnie Carson, said the global superpower remained committed to maintaining strong trade ties with the African continent.
The reassurance from the US special presidential representative came after the summit that intended to tighten programmes on shared priorities, something the Biden Administration believed faltered with Trump’s presidency.
Carson spoke at a media briefing arranged by the US Department of State’s Bureau of African Affairs on Tuesday. “The United States has been the continent’s strongest partner in the most important areas of development over the last three or four decades, and a lot of the very great and outstanding work that we do across the continent is not seen as visibly as some other things.”He added that work was being done to address the continent’s energy crisis.
AfCFTA: A Driving Force For Transport And Logistics In Africa (iAfrica)
Improved transport and logistics in Africa have immense potential to realise the vision of the African Continental Free Trade Agreement (AfCFTA). The AfCFTA envisions a borderless Africa, removing barriers to trade and investment by eliminating tariffs on most goods and harmonising customs procedures, while encouraging entrepreneurship and foreign investment, and promoting the free movement of people and capital.
During a recent online panel discussion, various challenges and opportunities were placed on the agenda to be unpacked at the shows later this year.
Beatrice Chaytor, Head of Division – Trade in Services of the AfCFTA Secretariat in Ghana believes once the AfCFTA is fully implemented, traffic routes across air, ports, rail and road travel will improve. “There are significant opportunities for investors in vital infrastructure like airports, warehousing, cold storage and more, and with tourism on the continent back to 88% of pre-pandemic levels for the first quarter of the year, ensuring a robust and reliable transport and logistics system across the continent makes good business sense.”
African Medicines Agency set to start work in Rwanda (Modern Diplomacy)
The African Medicines Agency (AMA), a newly launched continental regulatory body for medical products, is set to start its work, with its headquarters in Rwanda. Rwanda was selected to be the host of the agency during a 2022 AU Executive Council meeting in Lusaka, Zambia.
AMA is a specialised agency of the African Union (AU) intended to facilitate the harmonization of medical products regulation throughout the AU in order to improve access to quality, safe and efficacious medical products on the continent.
Many AU member states including Rwanda ratified the treaty establishing the continental agency and deposited the legal instrument of ratification to the AU Commission. On June 10, Rwanda and the AU signed the host country agreement, an important step in getting the work of AMA started.
The AU Commissioner for Health, Humanitarian Affairs and Social Development, Minata Samate Cessouma, said AMA will hugely contribute to the production of medicine on the continent, and allow it to move across the continent.
How Financing Can Boost Low-Income Countries’ Resilience to Shocks (IMF Blog)
Low-income countries face multiple economic challenges—including rapid inflation, food insecurity, costly borrowing, and mounting debt—heightened by shocks from the pandemic and Russia’s war in Ukraine.
As a result, the IMF has revised down its growth projections for low-income countries, where per capita income growth is falling further behind the rates needed to catch up with advanced economies. This threatens to reverse a decades-long trend of steadily converging living standards.
To boost economic growth and put them back on a path to income convergence with advanced economies, we estimate that low-income countries need an additional $440 billion of financing through 2026 from all available sources. As part of this, IMF concessional financing offered at low or zero interest rates will play a key role in helping these countries cushion the impact on growth from ongoing shocks and future crises.
IMF Managing Director’s Introductory Remarks to the G20 DGI Global Conference (IMF)
The Data Gaps Initiative was launched in 2009 by the G20 Finance Ministers and Central Bank Governors to close data gaps that were identified in the wake of the global financial crisis. Fast forward to 2021 and – in the midst of the pandemic – the G20 initiated a new phase, covering climate change, household distributional information, data access, fintech and financial inclusion.
Policy advice must be based on hard data. Data sharpens how we understand the economic and financial implications of the world around us—and is particularly important for tackling new and emerging issues like climate change, financial innovation and changes to wealth and income distributions.
But there are still gaps in our data. This impedes our ability to develop and monitor policies—from measures to incentivize cuts in emissions, to regulation that mitigates the risks of rapid financial innovation or helps boost financial inclusion.
Remittances Remain Resilient but Likely to Slow (World Bank)
Officially recorded remittance flows to low- and middle-income countries (LMICs) are estimated to grow by 1.4% to $656 billion in 2023 as economic activity in remittance source countries is set to soften, limiting employment and wage gains for migrants, according to the World Bank’s latest Migration and Development Brief released today.
This edition of the Brief also revises upwards 2022’s growth in remittance flows to 8%, reaching $647 billion. In the post-COVID period of slower economic growth and falling foreign direct investments, remittance inflows have become more important to countries and households, given their resilience as a source of external financing, particularly for LMICs with high external debt.
G20 GDP growth accelerates to 0.9% in the first quarter of 2023 (OECD)
Gross domestic product (GDP) in the G20 area grew by 0.9% quarter-on-quarter in the first quarter of 2023 according to provisional estimates, up from 0.4% in the previous quarter.
This acceleration in the G20 area in Q1 2023 mainly reflected the reopening of the economy in China, where GDP growth picked up to 2.2% compared with 0.6% in the fourth quarter of 2022. The acceleration was also driven by higher growth in India, 1 where GDP rose by 1.9% in Q1 2023, up from 1.0% in Q4 2022. In Mexico, GDP growth reached 1.0% in Q1 (compared with 0.6% in Q4) and in Japan it reached 0.7% (compared with 0.1%). Several economies returned to growth after contracting in the fourth quarter of 2022: in Brazil GDP rose by 1.9% in Q1 after contracting by 0.1% in Q4, while in South Africa and Korea, GDP grew by 0.4% and 0.3% respectively after contracting by 1.1% and 0.4%.
DDG Ellard urges acceptance of Fisheries Subsidies Agreement, progress on new disciplines (WTO)
One of the biggest achievements of MC12 was the conclusion of the binding Agreement on Fisheries Subsidies, the first WTO Agreement with environmental sustainability at its core. This accomplishment has greatly energized our Members and has given them great confidence in multilateralism. And it has encouraged them to do more.
But the adoption of the Agreement did not bring an end to the WTO’s work on fisheries. To the contrary, now that the Agreement is concluded, WTO Members are engaged in three parallel processes to carry the work forward.
First is accepting the new Agreement. To deliver its benefits for the ocean, the Agreement must enter into force, which requires two-thirds of WTO Members to deposit their instruments of acceptance with the WTO.
The second effort underway relates to how the WTO will assist developing and least developed Members in implementing the new disciplines.
The final of the three strands of ongoing work on fisheries is continuing negotiations to resolve the outstanding issues that could not be agreed at MC12, which include disciplining subsidies that contribute to overcapacity and overfishing, along with appropriate and effective special and differential treatment for developing and least-developed Members.
Seven Takeaways From Tracking SDG7: The Energy Progress Report 2023 (Sustainable Energy for All )
Despite a recent slowdown in the global pace of electrification, the number of people without electricity almost halved over the past decade, from 1.1 billion in 2010 down to 675 million in 2021.
The annual Tracking SDG7 report is produced to monitor global progress toward Sustainable Development Goal 7 (SDG7) and to offer a clear picture of how far we still need to go to ensure affordable and clean energy for all by 2030.
The report tracks global, regional, and country progress on energy access, energy efficiency, renewable energy, clean cooking, and international cooperation to advance SDG7. It presents updated statistics for each of the indicators and provides policy insights on priority areas and actions needed to spur further progress on SDG7, as well as related SDGs.
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Namibia takes control of its resources as it bans the export of unprocessed vital mineral (Business Insider Africa)
The country’s Ministry of Information also disclosed that only trace amounts of the listed minerals would be allowed to be exported with the mines minister’s agreement.
Namibia is a major supplier of uranium and gem-quality diamonds, but as the globe switches to renewable energy sources, interest in its battery metals is rising. In line with the EU’s desire to lessen its reliance on China for essential minerals, Namibia and the EU reached a deal last year to provide rare earth minerals to the latter.
Zimbabwe, a different producer of lithium in Africa, barred the export of lithium ore in December and only permitted the shipment of concentrates. Zimbabwe has stated that it wants the nation’s lithium miners to strive toward producing battery-grade lithium locally and that it may eventually levy a tax on lithium concentrate exports.
African Continental Free Trade Area Awareness Workshop Goes to Mpumalanga (The Department of Trade, Industry and Competition)
Buisnesspeopole in Mpumalanga will get an opportunity to learn more about the export opportunities that are presented by the African Continental Free Trade Area (AfCFTA). This will happen during the Mpumalanga leg of the awareness workshops on the implementation of the AfCFTA Agreement. The workshop will be hosted by the Department of Trade, Industry and Competition (the dtic), in partnership with the Mpumalanga Growth Development Agency (Mega) at the Capital Hotel, in Mbombela on Thursday, 15 June 2023 from 09:00.
This will be the fourth in a series of workshops that the department is rolling out throughout the country from May-July 2023. The inaugural workshop took place in KwaZulu-Natal on 25 May 2023. Another was held in Gauteng on Monday last week, while the Limpopo leg took place in Polokwane yesterday. All the workshops received positive reviews from businesspeople who attended the sessions. They welcomed the progress and benefits that the AfCFTA will afford the private sector once implemented.
US lawmakers call for S.Africa to lose summit over Russia ties (Reuters)
A group of U.S. lawmakers is calling for a U.S.-Africa trade summit planned for later this year to be moved from South Africa in response to what they said was the country’s “deepening military relationship” with Russia.
In a letter to U.S. Secretary of State Anthony Blinken and other senior officials, they also suggested South Africa is in danger of losing its benefits under the African Growth and Opportunity Act (AGOA) - Washington’s flagship trade programme. South Africa is due to host the AGOA Forum in Johannesburg, a meeting of African leaders and U.S. officials to discuss the future of the programme, which is slated to expire in 2025.
South Africa’s exports to the U.S. under AGOA reached nearly $1 billion in the first three months of this year, making it the second biggest beneficiary of the programme after Nigeria.African nations are seeking to extend AGOA, which grants qualifying countries’ exports preferential access to the U.S.
National Logistics Crisis Committee to tackle transport emergencies in parallel to reform agenda (Engineering News)
The National Logistics Crisis Committee (NLCC) will adopt a two-pronged approach to addressing the rail, port and road crises currently undermining growth and job creation in South Africa, whereby several urgent interventions will be pursued in parallel to a reform agenda with longer-term implications, including the opening of rail and port networks to private operators.
The Presidency’s project management office head Rudi Dicks tells Engineering News that government and business have already agreed to jointly support the workstreams that will be formed under the NLCC, the final terms of reference for which are likely to be signed off later this week.
South Africa’s transport network holding economic growth back (Engineering News)
South Africa‘s transport modalities – all of them – are currently unable to support greater economic growth in the country. So warned South African Association of Freight Forwarders CEO Juanita Maree, addressing the forty-fifth Annual SAPICS Conference in Cape Town on Monday.
“Supply chain is more about problem solving” than anything else, she pointed out in her introductory remarks. It was “not one [transport] modality above another modality”. All were equal. But, currently, in South Africa, the roads were overused.
“There’s too many trucks on the road,” she stated. For just one example, there were 1 800 trucks driving on the N4 route from Gauteng province to Mozambique’s capital and port city of Maputo every day. But the road was not designed for such a level of heavy traffic.
This heavy dependence on road transport is the result of the severe deterioration of the country’s railway network. And South Africa’s own ports being extremely inefficient.
Uganda sets 25% tariff on imported refined sugar (Monitor)
Local sugar manufacturers can now breathe a sigh of relief after the government set a 25 percent tariff on refined sugar imports. Uganda Revenue Authority (URA) Assistant Commissioner for Trade Irene Muliika announced the new tariff in a June 7 letter to Uganda Manufacturers Association (UMA).
According to Ms Muliika, the import tariff is as per the East African Community (EAC) raw material duty remission scheme for 2023/2024. URA said this represents a compromise position that protects local producers of industrial refined sugar while also leaving the door open to imports for any user that requires it for technical reasons.
This is against the total ban on imports that had been proposed earlier. The 25 percent duty is in line with most other finished products produced in Uganda.
Museveni banks on oil, exports in bullish economic growth forecast (The East African)
Uganda President Yoweri Museveni has given his most optimistic view of the economy yet, projecting it to grow at an average of 6.5 percent to seven percent per annum in the next five years, banking on manufacturing, increased oil and gas activities, and exports growth — all pegged to the recovering regional and international markets, low inflation, and support to small scale enterprises.
This will push the country’s GDP to $55.2 billion by the end of the 2023/24 financial year — up from the current $49.4 billion — which translates into $156.76 billion in purchasing power parity terms, and take the country’s GDP per capita to $1,186, from $1,096 in the current financial year.
Despite slow recovery of some key sectors like tourism from the Covid-19 effect, the World Bank said in December last year that Uganda is returning to its pre-pandemic path to growth, with economic recovery boosted by the strong performance of the services and industrial sectors, buoyant private consumption, and an uptick in private investment.
the Ugandan leader took issue with the slow pace of infrastructure growth in the key sectors of the economy, particularly energy and which are supposed to power the country’s industrialisation agenda with lower tariff for manufacturers.
GRA clarifies upfront payment policy for VAT at Ports (The Business & Financial Times)
The Ghana Revenue Authority (GRA), recently announced the introduction of an upfront payment of 12.5% on the customs values of VAT registerable imports at the various entry ports of the country.
However, the Ghana Revenue Authority has clarified that this is not a new tax, but a tool to ensure VAT compliance among importers of goods.
Speaking with Kennedy Mornah on the Eye on Port TV program, officials of the Ghana Revenue Authority indicated that the primary goal of this measure is to ensure that importers of VAT-taxable goods register.
An Assistant Commissioner and the Office manager at the Nima Taxpayer Service Centre, Mr. Joseph Fiadzo said, “the policy is aimed at roping in more taxable persons, in that, the taxpayer who is faced with the situation of upfront payment at the port, once he has registered, we will be able to know his channel of distribution and get others into the tax net.”
“We have some groups who have registered for VAT and charging VAT. Other importers will bring goods into country and will not charge VAT. If we go to the market, buying the same category of goods from these separate traders, they will cost differently,” a Senior Revenue Officer at the Spintex Taxpayer Service Center, Felicia Omotayo Owusu added.
Rwanda, AUC Sign Agreement To Establish African Medicines Agency (Heritage Times)
The Rwandan government and the African Union Commission (AUC) have concluded plans to establish first ever African Medicines Agency with headquarters in Kigali, Rwanda. On 10th June, Rwanda signed an agreement with the African Union to host the headquarters of the African Medicines Agency in Kigali.
The signing comes just a few days after the Rwandan authorities officially agreed to host the AMA’s headquarters on their territory.
According to the AUC, creation of the African Medicines Agency is part of the African Union’s strategy to reduce the continent’s dependence on pharmaceutical products supplied by foreign countries. Africa imports 97% of the pharmaceutical products it needs.
Part of its duties will be to regulate and harmonize this market on the continent, encourage production in Africa and counter the traffic in counterfeit medicines.
Gold output up 32% as country returns to top spot (The Business & Financial Times)
Domestic gold production went up 32 percent from 2.8 million ounces in 2021 to 3.7 million ounces in 2022, propelling the country to the summit as Africa’s largest producer of the precious yellow metal.
The increase, the Ghana Chamber of Mines (GCM) explains, is attributed to a combination of fresh output and expansion of production at existing large-scale mines.
Production from the large-scale sector rose from 2.7 million ounces in 2021 to 3.1 million ounces in 2022, representing an increment of 13 percent – the highest in history, with the small-scale sector accounting for the remainder.
Meanwhile, the recent upturn in export of diamonds persisted in 2022 with an expansion in the volumes from 54,174 carats in 2021 to 82,252 carats in 2022. On a year-on-year basis, the volume of diamond exports improved by 52 percent.
Cocoa prices surge as El Niño threatens production amid Ivory Coast supply concerns (The Business & Financial Times)
Cocoa prices experienced a further rally last week, due to growing concerns about the potential impact of an El Niño weather event on global cocoa production.
Last Friday, cocoa prices reached their highest level in a month for nearest-futures contracts, building on the gains observed on Thursday due to worries about the El Niño weather event. It is worth noting that cocoa prices soared to a 12-year high in 2016 when a previous El Niño event caused a drought that severely affected global cocoa production.
This is particularly significant as the Ivory Coast, the world’s leading cocoa producer, is already facing a decline in supply.
Reduced supply from the Ivory Coast is another factor supporting cocoa prices, as reported by Barchart – a platform that monitors the Cocoa Futures Market.
Liberia: Executive Order 119 should produce fruits (The New Dawn Liberia)
President George Manneh Weah issued Executive Order 119 last week Thursday, June 8, imposing surcharge on a few imported goods or raw materials to protect domestic manufacturers and stimulate economic growth. The Executive Mansion in Monrovia says Executive Order 119, which takes immediate effect, seeks to solidify gains realized under Executive Order 103 and stimulate growth in the Liberian economy.
Government says this is her way of recognizing the need to provide incentives for domestic job creation as envisaged under Pillar 2 (Economy and Job) of the Pro-Poor Agenda for Prosperity and Development (PAPD) by protecting local businesses from unfair competition and international brands of locally manufactured goods.
ICC prioritises support for SMEs within AfCFTA (The Business & Financial Times)
The International Chamber of Commerce (ICC) is prioritising support for small and medium enterprises (SMEs) on the continent to take full advantage of the African Continental Free Trade Area (AfCFTA), its Secretary-General, John Denton, has said.
Mr Denton, speaking to the B&FT in Accra during an official working visit to Ghana and sub-Saharan Africa, said the Chamber is working with its ICC Regional Centres of Entrepreneurship (CoEs) on the continent to prioritise and prepare SMEs to harness greater participation in the AfCFTA with emphasis on promoting cross-border trade.
Already, the ICC has built capacity for several women-led businesses in Africa with recent programmes, partnering UPS, Tralac and West Blue Consulting. The Chamber also hosted an open innovation for several startups in Nigeria, Kenya and the World Food Programme innovation accelerator in East Africa.
Well-built cities, services could rekindle African economies (The East African)
African governments will need to ramp up investments in urban infrastructure and the service industry to help revive the economic growth needed to eradicate absolute poverty.
As Africa’s population continues to grow fastest in the world, a new report by the McKinsey Global Institute (MGI) shows that, despite positive signs at the start of this century, Africa’s economies took a different turn in the second decade and might get into a deeper plunge if nothing is done now.
Compared to other emerging economies like India and China, Africa’s GDP grew at a relatively slower pace between 2000 and 2019 and even slower over the last decade.
“Gaps in infrastructure and skills, along with relatively high hurdles to conducting business, low levels of intracontinental trade, and dependence on natural resources, were obstacles to Africa’s growth,” said the report. Due to these hurdles, Africa’s GDP in 2019 was $400 billion less than what it could have been had the economy continued to grow at the same pace it did in the 2000 – 2010 period.
To reignite growth, MGI argues Africa needs to focus on improving the productivity of the service industry, which is emerging to be the largest employer not only in emerging markets, but across the globe.
Private sector pushes harmonised taxation to ease cost of business (The East African)
The private sector in East Africa has added its voice to the debate on the un-harmonised proposed tax increments in partner states ahead of the reading of the financial year 2023/24 budgets. Most of the taxes have not been harmonised across the region thereby likely to lead to a high cost of doing business.
Of those proposed in the Kenya, Uganda, Tanzania and Rwanda budgets, the only one that has been harmonised is the income tax, at 30 percent. The rest, including value added tax (VAT), vary in their application, a factor that impacts cross-border business.
Eritrea rejoins east Africa trade and security bloc IGAD after 16 years (Africanews)
Eritrea says it is ready to work toward “peace, stability and regional integration after it rejoined the East African bloc, the Inter-Governmental Authority on Development (IGAD) on Monday. It comes nearly 16 years after the politically isolated state pulled out of the bloc.
The east African nation led by 77 year old Isaias Afwerki who has ruled for three decades, had suspended its IGAD membership in 2007 after a string of disagreements. One of them was the bloc’s decision to ask Kenya to oversee the resolution of a border dispute between Ethiopia and Eritrea.
Powering up southern Africa (African Review)
With southern Africa experiencing a serious power deficit which is taking its toll on economic productivity, multiple initiatives are underway to alleviate the crisis
The Democratic Republic of Congo (DRC) is seen as a country with massive hydroelectric power potential to mitigate the crisis currently experienced in multiple countries in southern Africa. The Zambian-based Copperbelt Energy Corporation (CEC) has significantly invested in the construction of a second power interconnector line to DRC that will increase transmission capacity from 260MW to 550MW to address electricity challenges in Zambia and the sub region.
African countries should go into partnerships whenever undertaking power projects in order to adopt sustainable solutions and speed up implementation processes. Zambia is on the right path as it has already embraced the concept of integration as evidenced by the estimated US$5bn Batoka hydro power project, which is being undertaken in conjunction with Zimbabwe, while other projects in the North of the country are being considered in partnership with DRC.
African business leaders chafe at obstacles to trade (eNCA)
More than four years ago, African countries gave the ceremonial push to a deal to scrap internal trade barriers -- a historic scheme that would create a continent-wide single market worth trillions of dollars. But African business leaders say cross-border trade remains entangled in customs duties, administrative hurdles and varying national regulations.
Costs and delays are hampering African corporations fighting to compete with low-cost rivals, they say.
Its secretary-general, South African trade expert Wamkele Mene, told the Africa CEO Forum that “fragmentation” in the continent’s market had worsened in the past decades. “Every African activity has been negatively impacted by this fragmentation,” he said.
The problems are having an impact on African companies competing with developing-country counterparts facing lower or even zero hurdles.
Brazil’s Lula eyes trips to Africa to boost trade, diplomacy (Engineering News)
Brazil is seeking to mend ties with Africa, largely ignored by the Bolsonaro administration, as the government prepares for two rounds of official trips to the continent.
Besides repairing diplomatic relations, Brazil wants to widen its economic footprint in Africa as it sees trade and business potential in the region, in line with the Brazilian government’s South-South integration agenda.
G20 Development Ministers’ Meeting (UNCTAD)
The 2030 Agenda, with its 17 Sustainable Development Goals, is not just a set of targets. It is a promise we made to ourselves and to future generations. It is the last collective roadmap in a world that is more polarized than ever, a world in desperate need of solidarity and multilateralism.
If we do not save SDGs today, there will be nothing left to save us tomorrow. And yet, we will fail to save them, if we don’t quickly take action. We cannot act as if failure is an acceptable option. The SDGs are simply too big to fail.
Cascading crises have set us back. A cost-of-living crisis has disproportionally hit developing countries and the most vulnerable. By nearly every measure, we are moving backwards. Backwards on ending poverty. Backwards on hunger. Backwards on women’s rights. And backwards on development, with only 12 per cent of the Sustainable Development Goals on track.
The UN SDG Stimulus plan calls for three things to widen countries’ fiscal space for development and foster sustainable investments: first, massive lending increases from multilateral development banks, leveraging private resources; second, a multilateral answer to growing debt distress, so that no country is forced to either service their debt or serve their people; and third, strengthening the global financial safety net.
Security in digital economy a global challenge: Union minister Rajeev Chandrasekhar (Deccan Herald)
Union minister Rajeev Chandrasekhar on Monday said that security in the digital economy is a global challenge and a partnership approach is needed to tackle it. He was addressing G20 delegates at the Global Digital Public Infrastructure (DPI) summit at the third Digital Economy Working Group (DEWG) meeting here in Maharashtra.
“The digital economy security is neither a domestic issue nor a domain in which selective cooperation is enough,” said the Minister of State for Electronics and Information Technology. He asserted that a common understanding must be devised to improve the domestic, legal, technical, and economic aspects of security in the digital economy.
“With the rise of health tech, fintech, e-commerce, artificial intelligence, and Internet of Things companies, businesses now hold large data sets that hold sensitive and personal data of consumers. Sectorally, most cyber crimes are reported in the financial services sector, followed by the healthcare sector.
UK exports in last decade worse than any G7 country except Japan (The Guardian)
Britain has endured the worst exports record of any member of the G7 besides Japan over the last decade, according to a new analysis that will raise pressure on the government to reconsider its post-Brexit trade deal with the EU.
As most of the world’s other major seven economies have rebounded from the pandemic, export growth has remained sluggish in the UK at a time when businesses trading with the EU faced extra red tape and costs as a result of the country leaving the bloc.
Figures from the United Nations Conference on Trade and Development (UNCTAD) show that the UK’s goods and services exports had a value of £813bn in 2012 and rose by just 6% to £862.6bn by 2021.
That compares with the double-digit increases enjoyed by Canada (10.2%), France (16.1%), Germany (22.7%), Italy (15.9%) and the US (13.8%). The EU’s 27 member states as a whole enjoyed a 29.1% increase in the value of their exports in the same period.
From rule-taker to rule-maker: Africa in the changing world order (ECFR)
African countries have long been discontent with the existing multilateral system, which they joined as rule-takers from a vast colonial territory under the domination of various European powers. There is much in the history and contemporary experiences of African partnerships with the West that the countries of the continent are right to be uncomfortable and even outraged about, including perceived Western political, economic, and cultural imposition, double standards, and conditional support. Today, Africa boasts 55 member states of the United Nations, vast natural resource endowments, an overwhelmingly youthful population, and strong prospects of becoming the next pole of global economic growth, making it well placed to be a joint rule-maker.
Many African leaders are looking east to China, India, Russia, Turkey, and other (re-)emerging powers, large and medium, for partnership. Zimbabwe was the first to officially espouse a “Look East Policy”, which it adopted in 2003 when the United States and the European Union imposed sanctions against the government’s alleged assault on human rights and the rule of law, and began to work closely with China as a strategic, economic, military, and political partner. However, Harare is far from alone in its resolve to consciously diversify relations away from the West by cultivating them with countries of the east, especially China. China is now Africa’s biggest trading partner, with $117.51 billion worth of imports from the continent and $164.49 billion of exports to it in 2022.
Some commentators argue that Africa is already suffering the consequences of engaging in a more competitive multipolar world without clarity of vision and purpose. Various centres of power, from the EU and the US, to India, Turkey, Russia, and the United Arab Emirates, are competing for the continent’s natural resources, markets, and military bases. As they seek avenues to plug African countries into their global geopolitical schemes, the region is becoming fragmented, undermining its capacity for coordinated collective action.
However, despite the slow pace so far, it is not too late for the continent to play a robust and autonomous role in defining the rules of a new world order.
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COMESA SG Outlines Key Achievements on Regional Integration
The 22nd COMESA Summit presented an opportunity for the COMESA Secretariat to brief the Heads of State on the state of integration and the milestones that have been covered this far.
In a state of integration report, Secretary General Chileshe Kapwepwe detailed the key developments and achievements in the past year focusing on the market integration and physical integration pillars.
Under trade liberalization, she noted that the membership to the COMESA Free Trade Area has remained at 16 States with the four countries the DR Congo, Eritrea, Eswatini and Somalia at different stages of full liberalisation.
“There was significant increase in COMESA’s trade globally and within the region above the pre-COVID-19 pandemic levels,” the SG said. “The value of COMESA’s total exports to the world significantly increased by 56% from US$ 100 billion in 2020 to US$ 156 billion in 2021. The sectors that contributed to this increase were manufactures, fuels, ores and metals and food.”
The value of Intra-COMESA total exports increased by 28% from US$ 10 billion in 2020 to US$ 13 billion in 2021. Key exports include palm oil, cement, copper ores and concentrates, beet/cane sugar, live animals and petroleum oils.
Among the largest exporting countries in the COMESA region, are Egypt, DR Congo, Tunisia, Seychelles, Uganda, Zimbabwe, Kenya and Zambia. They registered a combined increase of 41% in exported manufactured products in 2021 compared to 2020.
On the liberalization of Trade in Services, she highlighted the Secretariat’s continued support the negotiations in six priority areas in business, financial, transport, communications, tourism construction and energy services.
On trade facilitation, implementation of trade facilitation instruments to overcome barriers and accelerate intra-regional trade and investments has been strengthened with financial support from European Union, World Bank, African Development Bank, Afrexim Bank, and others.
On the Tripartite Free Trade Area, she engagement with countries that have not ratified it has been ongoing. The goal is to get three more signatures to attain the required threshold of 14 countries to enable the agreement to enter in force. Currently a total of 26 signatures and 11 ratifications have been received.
In the efforts to strengthen democratic governance, inclusivity and promote peace and stability, she underlined COMESA’s continued support towards entrenching good governance which is the foundation of peace and security. Activities under this initiative included mounting election observer missions to Member States that have been conducting elections.
The report also highlighted some of the key challenges and constraints that have been experienced in the implementation of programmes. They include slow and delayed domestication of agreed protocols, proliferation of non-tariff barriers, low levels of value addition, slow harmonization/weak coordination of multiple integration arrangements, restrictions to free movement of persons, labour and services and technical and financial constraints.
Going forward, the Secretary General urged Member States to eradicate barriers to trade, free movement of people, strengthen connectivity and invest in clean technologies to achieve the desired intra-regional trade and sustainable economic development.
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China is SA’s largest BRICS trading partner (IOL)
China is South Africa’s largest trading partner, both overall and within the BRICS (Brazil, Russia, India, China and South Africa) grouping.
In 2022, China accounted for 9.4% of South Africa’s exports and 20.2% of South Africa’s imports, according to the South African Revenue Service (Sars). In rand terms, exports to China totalled R188.4 billion, while South Africa imported R367.4bn, resulting in a trade surplus in favour of China worth R179bn.
South Africa’s exports to China are dominated by two categories, namely mineral products, as well as products of iron and steel. Mineral products are raw materials. In the case of exports to China, this is dominated by iron ore, but also includes coal, manganese and chrome ores, as China is the world’s largest producer of steel, accounting for 57.4% of global steel production in April 2023, according to the World Steel Association.
EU-Rwanda business forum to boost trade, investments (The New Times)
Hundreds of business operators from Europe and Rwanda will gather in Kigali, from June 26-27, 2023 for the EU-Rwanda Business Forum to explore investment and trade opportunities, as well as partnerships with businesses in the country, according to the Rwanda Development Board (RDB).
This first-ever forum is organised by the delegation of the European Union to Rwanda and the Government of Rwanda through RDB.
Held under the theme: “Rwanda-your gateway to Africa,” the two-day interactive event, open for all companies to attend, will feature plenary sessions on Rwanda’s business environment and investment opportunities with a focus on sectors with outstanding growth potential including agribusiness, mining, health and pharmaceuticals, financial and digital services, green and sustainable economy.
Burkina Faso: Recent Trends and Outlook for the Economy and Poverty – Building financial resilience to climate risks (World Bank)
According to the latest Burkina Faso Economic Update, economic growth slowed to 2.5% in 2022, with the country posting the highest inflation rate in the West African Economic and Monetary Union (WAEMU), thereby exacerbating food insecurity.
Following a robust recovery of 6.9% in 2021, GDP growth slowed in 2022 to 2.5% (corresponding to a contraction in GDP per capita of 0.1%), owing primarily to a 13.7% decline in mining activity as a result of mine closures. Average inflation reached 14.1% while food prices increased on average by 23.4% over the year.
“Burkina Faso continues to demonstrate resilience, despite the security and humanitarian crises plaguing the country. These various crises are compounded by the country’s vulnerability to climate change,” says Maimouna Mbow Fam, World Bank Country Manager for Burkina Faso. “In light of these overlapping vulnerabilities, Burkina Faso’s medium-term outlook will depend largely on whether it can improve its financial resilience to all kinds of shocks, including climate change.”
Kenya, Djibouti agree on visa-free travel in a move to enhance trade (Capital News)
Kenya and Djibouti have endorsed the reciprocal abolishing of visa requirements for their citizens. Ruto said Sunday during a joint press conference with his Djibouti counterpart Ismail Guelleh, that the move is aimed at fostering people-to-people interactions, trade, and investment.
He reiterated his administration’s commitment to eliminating the barriers imposed by visa requirements for Djiboutian citizens traveling to Kenya.
To improve coordination on labor migration and ensure predictability, President Ruto said that both governments had agreed to accelerate the negotiation and finalization of a comprehensive labor agreement between the two states. Ruto stated that to facilitate the process of harnessing Kenya’s skilled workforce, both governments had established a Joint Technical Committee dedicated to these efforts.
NPA expects trans-shipment cargoes at Lekki Port June ending (Tribune Online)
The Nigerian Ports Authority (NPA) has said that it expects to receive the first set of trans-shipment cargoes at Lekki Port in three weeks time (June ending).
Speaking over the weekend during the commissioning for Lekki Port operations, two 80-Ton Bollard Pull Tug-boats christened M.T MAIKOKO and M.T DA-OPUKURO, the Managing Director of the NPA, Mohammed Bello-Koko revealed that the agency recently had a meeting with officials from Chad, Niger and Cameroon over movement of their trans-shipment cargoes from Lekki Ports.
According to the NPA Managing Director, “By acquiring this Tug boats, which are the largest in Africa, we will be able to bring in vessels of all sizes. What this means is that there would be less waiting time and it will eventually lead to reduction in cargo dwell time.
Ghana to intensify trade business and investment across Africa, rest of the world (Ghanaweb)
Small and medium-sized enterprises (SMEs), investors and business executives in Ghana and around the world have been assured of a robust economic gains by the Global-Africa Trade Advisory Chamber, (GATAC), through the Africa Continental Free Trade Agreement (AfCFTA). This was revealed by the president of GATAC, Mr Dominic Oduro Antwi at the second edition of the Global Africa Business dialogue held in Dubai.
Following a successful launch of the Global Africa Trade Advisory chamber in Accra on the 10th of December 2021 and the maiden edition of the Global Africa Business dialogue in Accra, the second edition has been held in Dubai with the focus of revamping Africa’s economy by increasing trade investment through the Africa Continental Free Trade Agreement (AfCFTA).
Speaking at the event Dr. Arshi Ayub Zaveri, a special advisor to the Royal Family in Abu Dhabi acknowledged the chamber’s role in line with the government’s vision to promote trade and make Ghana the hub of investment and business in Africa.
After a Decade-Long Hiatus, IMF Surveillance Resumes in Libya (IMF)
Libya has been mired in conflict and political uncertainty since the fall of the Ghaddafi regime in 2011. Until recently, the country’s fragmentation hampered policymaking and the collection of key economic data. However, the country has made significant efforts to move forward and overcome the economic challenges brought by political conflict.
As Libya paves the way for its economic recovery, it has made recent improvements in data collection, sharing, and transparency that have enabled the IMF to resume its surveillance after a decade-long hiatus.
The Joint Meeting of Committee of Ministers responsible for Transport, ICT, Information and Meteorology and Infrastructure from the Southern African Development Community (SADC) will meet virtually on June 16, 2023, to assess the status of implementation of decisions and progress made since the sectorial meeting held in July 2021 as well as the status of implementation of SADC Summit of Heads of State and SADC Council of Ministers decisions. The meeting will further receive progress reports on programmes and activities in line with the SADC Regional Indicative Strategic Development Plan (RISDP 2020-2030), as well as the SADC Regional Infrastructure Development Master Plan (RIDMP 2012-2027).
In support of the SADC Industrialisation Strategy and Roadmap 2015-2063, the Ministers will consider the status of implementation of regional infrastructure programmes that support the industrialisation agenda while promoting regional integration and economic growth in line with the SADC Vision 2050 and RISDP 2020-2030.
Building foundations for a safe, green and inclusive built environment in Sub-Saharan Africa (World Bank)
Building regulatory frameworks, which comprise a set of laws, regulations and implementation mechanisms that reference the planning, design, construction, and control mechanisms, have proven to be the most effective tools to protect health and safety in the built environment and reduce disaster risk. This is especially true in Sub-Saharan Africa where population growth and a rapid transition from rural to urban development is expected to lead to a demand for hundreds of millions of new buildings over the next few decades.
This study, Building Regulations in Sub-Saharan Africa: A Status Review of Sub-Saharan Africa’s Building Regulatory Environment, supported by the Global Facility for Disaster Reduction and Recovery (GFDRR), provides the first comprehensive snapshot of the building regulatory environment in the region. Data was gathered through a desktop review of regulatory documents from all 48 countries in the region, with additional information provided by survey data and interviews from public and private sector experts on the ground.
Manufacturers, free trade can help to overcome Africa’s energy crisis (Engineering News)
African manufacturers have a significant role to play in helping to remedy the continent’s energy crises by developing innovative solutions for energy storage and access. By creating products tailored to the needs of the African context, manufacturers can help reduce energy poverty, increase energy efficiency and spur economic growth.
However, this depends on whether the right environment is created to help manufacturers expand operations and pursue cross-border investment opportunities, electromechanical equipment manufacturer Actom Group CEO and Manufacturing Circle chairperson Mervyn Naidoo says.
Reducing energy poverty and spurring economic growth can only be accomplished once manufacturers achieve economies of scale. However, there is currently very little economic growth across many parts of the continent owing to a lack of investment in manufacturing capacity expansion.
Middle East, North Africa Vulnerable to Rising Fiscal Risks (IMF)
In an uncertain world, budget revenue and spending often end up far away from government plans. Volatile growth, high universal subsidies, and loss-making state-owned enterprises expose many low- and middle-income economies in the Middle East, North Africa, and Pakistan to such fiscal risks. These factors combine with adverse external developments such as recent interest-rate rises and food and fuel price surges to put public finances under pressure in many countries.
As we explain in a new paper, the “MENAPEG” region—a group that includes economies in the Middle East, North Africa and Pakistan but excludes high-income Gulf countries—is especially vulnerable to fiscal risks. In fact, small fiscal risks occur in countries every year. Importantly, larger shocks that cause debt to increase by an average of 12 percent of gross domestic product occur, on average, once every eight years.
Unleashing the Potential: India-Africa Business Engagement in the Global South (Financial Express)
The growing cooperation between India and Africa is poised to witness a boost, leveraging the emerging scenario of Global South collaboration. With a trade target of US$200 billion by 2030, a significant surge from the current US$90 billion level, and a goal to double Indian investments in Africa to $150 billion, the stage is set for a transformative partnership.
The 18th edition of the CII-EXIM Bank Conclave on India Africa Growth Partnership, themed ‘Creating Shared Future,’ is slated to take place in New Delhi from June 14-16, 2023.
The realization of the Africa Continental Free Trade Agreement (AfCFTA) goals presents fresh avenues for Indian investments in Africa, with the potential to double cumulative Indian foreign investments in the region to US$ 150 billion in the years to come.
Africa needs deeper linkages employing its opportunity to champion in trade and investment of the global market, Trade and Regional Integration State Minister Endalew Mekonen said. Addressing the Africa trade and investment summit held in Addis Ababa today, State Minister of Trade and Regional Integration Endalew Mekonen said “Africa can be an opportunity of champion related to trade and investment in a global market.”
He added it is important that Africa goes to deeper and deeper particularly into continental market linkage among African countries such as AfCFTA.
State Minister of Industry Hassan Mohammed for his part mentioned the reform agenda which has been key in easing doing business in Ethiopia. ‘Let Ethiopia Produce’ movement is also one of the recent initiatives which is being undertaken by the government to promote the ample investment opportunities in the country, he indicated. Invest in Ethiopia’s manufacturing, mining, agriculture and other emerging sectors and opportunities and economic challenges shaping Africa’s future were among the points of discussion at the one-day summit.
African leaders to advance the blue economy and climate action in Moroni (UNECA)
A three-day ministerial conference on “The Blue Economy and Climate Action in Africa: Island and Coastal States at the Forefront” with a focus on the Great Blue Wall initiative will be held from 12 to 14 June 2023 in Moroni, the capital of the Union of the Comoros.
The conference will bring together ministers, experts, civil society representatives, and development partners to discuss the challenges and opportunities of the blue economy in Africa, as well as the best practices and policies to address the impacts of climate change on coastal and marine ecosystems. This meeting is expected to adopt a declaration and a roadmap for advancing the blue economy agenda in Africa, as well as a framework for cooperation and partnership among stakeholders.
Nigeria formally accepts the Agreement on Fisheries Subsidies (WTO)
DG Okonjo-Iweala said: “I am profoundly grateful to Nigeria for formally accepting the WTO Agreement on Fisheries Subsidies. I am proud to see the country’s continued commitment to sustainable development and its vote of confidence in the work of the WTO. Nigeria’s acceptance adds to our growing tally of members that have accepted the Agreement — we have received about one-third of the total that we need for the Agreement to enter into force. I hope that Nigeria’s action serves as an inspiration to other governments in Africa and the rest of the world to move swiftly to implement the Agreement and foster global cooperation for the benefit of our shared future.”
Working group on food security intensifies discussions, eyes first report in July (WTO)
Trade and Environment Week 2023 to spotlight collective trade solutions for sustainability (WTO)
DG Okonjo-Iweala: Faced with risk of fragmentation, WTO members must stick together (WTO)
“This is a very uncertain time in the world,” said the Director-General. “The world economy is growing slowly. There are very serious geopolitical tensions. We have problems of the global commons like climate change, and we have the war in Ukraine. So there are a number of uncertainties that are facing the global trading system.”
The Director-General expressed concern about the existing geopolitical tensions between major traders, which are leading to an increasing narrative of decoupling into two separate economic blocs, deglobalization and the risk of fragmentation of the global trading system. She noted that this situation arises from the serious vulnerabilities in global supply chains and the trading system as a result of the COVID-19 pandemic and the war in Ukraine. She said there is a need to be very cautious as having a world trading system divided into two or more blocs could be very costly for the entire global economy.
Intermediate goods exports fall in fourth quarter of 2022 amid supply chain disruptions (WTO)
World exports of intermediate goods (IGs) fell by 10 per cent year-on-year in the fourth quarter of 2022 to US$ 2.3 trillion, reflecting the disruptions global supply chains faced in the closing months of the year due to the geopolitical context, commodity shortages, high energy prices and weak consumption. The decrease affected practically all regions.
The decrease in global IG exports can be partly traced to the product categories “parts and accessories (excluding transport equipment)” and “other industrial supplies,” which declined by 13 per cent and 14 per cent respectively year-on-year in the fourth quarter of 2022. World exports of ores and precious stones, meanwhile, decreased by 3 per cent, reflecting the downward demand worldwide and a decrease in prices, especially for iron ores. Food supply chains, in contrast, remained resilient with IG exports in the “food and beverage” product category rising by 7 per cent.
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SA’s logistics chain in ‘desperate’ need of PPPs – SAAFF (Engineering New)
Port and rail parastatal Transnet and government cannot “go it alone” to repair South Africa’s strained logistics network, says South African Association of Freight Forwarders (SAAFF) CEO Dr Juanita Maree.
“Our current ports and rail model is, at best, archaic compared to international standards, while it also fails the country’s socio-economic growth and development goals.”
Maree says South Africa “desperately needs” a public-private partnership (PPP) model that will create jobs and attract “much-needed” investment in the logistics sector and the economy.
SA’s strong exports surprisingly narrowed current account deficit (The Citizen)
South Africa’s strong exports narrowed the country’s current account deficit in the first quarter of 2023, declining to a seasonally adjusted and annualised deficit of R66.2 billion or 1% of GDP. The narrowing surprised economists as it follows the steep deficit of R155 billion (2.3% of GDP) in the fourth quarter of 2022.
According to data released by the Reserve Bank (Sarb) today, South Africa’s trade surplus widened from R34.2 billion in the fourth quarter to R103 billion in the first quarter as the value of goods exports increased more than that of merchandise imports.
The shortfall on the services, income and current transfer account narrowed for a third consecutive quarter to R169 billion from R190 billion in the fourth quarter. The Sarb says the smaller deficit emanated from a smaller deficit on the services account, while the deficits on the primary and secondary income accounts increased.
Namibia exported goods worth N$218m to Kenya in five years (Windhoek Observer)
Namibia exported goods to a value of N$218.7 million during the period 2015 to 2022 to Kenya, Namibia Statistics Agency has revealed. Statistician General, Alex Shimuafeni said on the demand side, Namibia imported goods amounting to N$89.2 million from Kenya over the same period. The statistics on Kenya was part of the NSA’s comment on the intra-Africa trade that looked at Namibia’s trade with Kenya.
The NSA commented that the African Continental Free Trade Area (AfCFTA) is one of the flagship projects of Agenda 2063: The Africa We Want. It is a high ambition trade agreement, with a comprehensive scope that includes critical areas of Africa’s economy, such as digital trade and investment protection, amongst other areas.
The NSA further said during April 2023, Namibia imported goods amounting to N$ 4.3 billion from the rest of Africa with goods valued at N$0.1 million being sourced from Kenya, whereas, on the supply side, the country supplied Africa with goods worth N$ 4.2 billion during the month under review with N$1.9 million of goods destined to Kenya. The export basket to Kenya mainly comprised of alcoholic beverages.
AfCFTA holds promise for SA exports, but implementation roadblocks remain (Engineering News)
While the African Continental Free Trade Area (AfCFTA) Agreement presents a significant opportunity to access a larger market for South Africa‘s exports and the local manufacturing sector, industry organisation Manufacturing Circle executive director Philippa Rodseth highlights the need for extensive work in terms of implementation.
Speaking during Creamer Media’s local manufacturing-focused webinar, she mentioned ongoing discussions and negotiations relating to trade bloc and tariff agreements as some of the challenges that needed to be addressed.
“From an industry perspective, manufacturers need to be more proactive and well informed about the agreements and opportunities within the regional value chain,” Rodseth noted, stressing the need to understand South Africa‘s trade interests, both in terms of exporting products and defending against imports.
To do this, she suggested that South Africa‘s manufacturing industry “work towards providing valuable insights to South African trade negotiators and find ways to address nontariff barriers”.
Sinimbo embraces African free trade e-commerce (New Era)
The inclusion of a digital trade protocol within the African Continental Free Trade Area (AfCFTA) should minimise many already existing challenges across the continent. This can significantly contribute to poverty reduction through the employment as well as e-commerce training and capacity building.This is according to deputy trade and minister Verna Sinimbo who shared these sentiments in London this week during a two-day Commonwealth trade ministers meeting.
“The e-commerce will decrease transportation costs for trade deliveries by removing tariff barriers and will upgrade digital infrastructure by establishing more reliable payment solutions and improving internet access across the continent,” Sinimbo explained.
She added that due to the complexity of e-commerce, it overlaps with many areas of trade and law, such as consumer protection, data protection, intellectual property rights, competition policy, tax-related issues as well as regulation on online dispute settlement.
Angola committed to AfCFTA accession process (Angop)
Angola remains committed to the process of accession to the African Continental Free Trade Area (AfCFTA), ANGOP learnt on Thursday. The country’s engagement was announced by the director of the Legal Office for Exchange of the Ministry for Trade and Industry, Anatólio Domingos.
Speaking to journalists on the sidelines of AfCFTA Secretariat’s visit to the Trade and Industry Ministry, Anatólio Domingos said the country needs to reach 90 percent of liberalisation of certain products to achieve this goal.
“After the completion of the work, he said, the proposal will be submitted to AfCFTA secretariat division for verification. After a positive response, it will be forwarded to the minister before being submitted to the Cabinet Council for approval,” he explained.
In terms of products and services to be exempted from the customs tariff, Domingos said there are 5,417 tariff lines. For immediate liberalisation, the agreement requires 90 percent of the lines.
Final Communiqué of the 22nd Summit of the COMESA Authority of Heads of State & Government (COMESA)
The Twenty Second Summit of the COMESA Authority of Heads of State & Government was hosted in physical format at Mulungushi International Conference Centre, Lusaka, Zambia on 8 June 2023, under the theme: “Economic Integration for a Thriving COMESA Anchored on Green Investment, Value Addition and Tourism”. The Authority reached agreement in the following trade-related areas, among others: the COMESA Free Trade Area; COMESA-EAC-SADC Tripartite Arrangement; Promotion of Movement of Persons, Labour, and Services; Infrastructure Development; and Agriculture, Industry and Private Sector Development.
COMESA SG Outlines Key Achievements on Regional Integration (COMESA)
Secretary General Chileshe Mpundu Kapwepwe presented detailed report on key developments and achievements recorded in the past year in the COMESA region under the market integration and physical integration pillars.
Presenting her State of Integration Report to the 22nd COMESA Heads of State and Governments Summit, the SG revealed that under trade liberalization, membership to the COMESA Free Trade Area remained at 16 states with the four countries the DR Congo, Eritrea, Eswatini and Somalia at different stages of full liberalisation.
“There was significant increase in COMESA’s trade globally and within the region above the pre-COVID-19 pandemic levels. The value of COMESA’s total exports to the world significantly increased by 56% from US$ 100 billion in 2020 to US$ 156 billion in 2021. The sectors that contributed to this increase were manufactures, fuels, ores and metals and food,” she said.
Report on the State of Integration of the Common Market for Eastern and Southern Africa (COMESA)
This report highlights developments and status of the regional integration process in COMESA since the 21st Summit held in November 2021, Cairo, Egypt. The report covers key achievements, challenges & constraints and proposed way forward.
Within the period, the COVID-19 pandemic dealt a considerable blow to economies in the region. Food insecurity increased, export revenues shrank, tourism sectors collapsed, while healthcare & social protection requirements ballooned, even as the pandemic eased. In addition, the conflict in Europe exacerbated budgetary pressures on prices of food, fuel and fertilizer with increase in debt burdens.
However, COMESA continued implementation of various programmes under the 2021-2025 Medium Term Strategic Plan whose key pillars include: Market Integration, Physical Integration/Connectivity, Productive Integration, and Gender and Social Integration.
Building investment partnerships in ECOWAS and COMESA regions (News Ghana)
The International Trade Centre (ITC), in collaboration with the COMESA Business Council and the COMESA Regional Investment Authority, are promoting trade and investment between the Economic Community of West African States (ECOWAS) and the Common Market for Eastern and Southern Africa (COMESA) regions.
As part of the West Africa Competitiveness Programme (WACOMP) implemented by ITC, a joint networking event manifested investment opportunities in targeted sectors and value chains, while fostering stronger partnerships between the two regions.
‘In the face of increased competition to attract international businesses, West African countries arguably have a strong card to play. To the extent that investors are well aware of all of these positive developments, international businesses ready to settle in the region will undoubtedly enjoy great returns, while being part of a collective journey towards greater economic and social vibrancy and the emergence of a dominant economic player in Africa and beyond.’ Akadiri Aminou, CEO, Federation of West Africa Chambers of Commerce and Industry (FEWACCI)
Ruto says AU member states will benefit more from stronger union (The Standard)
President William Ruto has called for reforms at the African Union (AU) to unite the continent. Ruto said he had discussed this with legislators of the Pan African Parliament and emphasised the need to adapt the AU to present realities.
“To ensure that the African Union performs at the level of its aspirations, it will be necessary to make sure that it empowers itself with sufficient capacity. Otherwise, African Solutions, Agenda 2063, the Africa Continental Free Trade Area, and the Young, Clean Green Continent of the Future will never be a reality,” he said.
“Member states must consider donating power to AU in trade, regional and global security matters as well as other areas that Africa can benefit from engaging together rather than individually,” he said.
African Union Retreat on Institutional Reforms and the second decade of Agenda 2063 kicks off (AU)
The African Union Retreat on Institutional Reforms and the preparations of the second decade of Agenda 2063 is currently underway in Kigali, Rwanda.
the retreat will discuss the second ten-year plan of Agenda 2063 that spans from 2024 to 2033. The Agenda 2063, adopted in January 2015, embodies the aspirations of the African people and is operationalized through 5 ten-year implementation plans, with the first plan spanning from 2014 to 2023. The implementation of the second decade of Agenda 2063 will be focused on acceleration, building on the first decade that focused on convergence. Valuable lessons learned from the first decade of Agenda 2063 have been captured in the biennial progress reports and the evaluation of the First Ten-Year Implementation Plan, among other documents, which in turn informed the design of the successor ten-year plan. Key among the revelations was the perception widely held by African citizens that Agenda 2063 is as relevant to the Continent’s development discourses as it was in 2013.
Financing the reforms and Agenda 2063 remains a top priority. Prof. Manasseh Nshuti, Rwanda’s Minister of State in the Ministry of Foreign Affairs and International Cooperation in Charge of East African Community, underscored the urgency for the African Union to realize its vision for reliable and predictable financing mechanism stating, “the Union’s reliance on external partner funding demands sincere discussions to achieve operational autonomy progressively. Since the Kigali Summit of 2016, AU Member States fully fund the organization’s operating budget. However, the continued dependence on external partners for program budget and peacekeeping operations defeats the Johannesburg decision to achieve 75%, and 25% Member States funding. These shortcomings raise questions about our commitment to peacekeeping operations and conflict prevention.”
Continent livestock project seeks to grow production and trade (The Standard)
Africa’s lifeblood is largely dependent on livestock farming, providing livelihoods, food security, and income opportunities for its populace. At the heart of recognising this immense potential was the African Union’s Inter-African Bureau for Animal Resources (AU-IBAR) that since 2017, embarked on a journey with the Sustainable Development of Livestock for Livelihoods in Africa (Live2Africa) project. This transformative initiative was poised to revolutionise the livestock sector, fostering sustainable development and empowering communities across the continent.
Live2Africa focused on addressing the key challenges faced by livestock farmers, improving productivity, enhancing market access, and promoting environmentally friendly practices. Now coming to its end the project that was majorly funded by AU member states and the European Union, focussed its activities aligned with the African Union’s Agenda 2063 development goals. According to Dr Nick Nwankpa, the acting Director of AU-IBAR, leveraging partnerships with governments, research institutions, and local communities, the project was a success.
India is open to negotiate trade agreement with Africa: Goyal (The New Indian Express)
India has expressed interest in negotiating a free trade agreement (FTA) with Africa with an aim to boost economic ties between the two regions. This was stated by commerce and industry Minister Piyush Goyal during his interaction with fifteen ambassadors from several countries of the African region here on Thursday.
“India is open to FTA negotiations bilaterally or individually with African countries or Africa as a whole,” he said. India would act as a trusted partner to expand trade, commerce, business, investment and opportunities with Africa, he said. In such agreements, two or more trading partners either significantly reduce or eliminate customs duties on the maximum number of goods traded between them.
IATA joins forces to strengthen Focus Africa (Airlines)
Focus Africa will strengthen aviation’s contribution to Africa’s economic and social development and improve connectivity, safety and reliability for passengers and shippers. It will see private and public stakeholders deliver measurable progress in six critical areas: safety, infrastructure, connectivity, finance and distribution, sustainability and skills development.
“Focus Africa is all about establishing a coalition of partners committing to pool their resources and delivering a set of African air transport solutions that let the continent, its people and economies play a greater, more meaningful and representative role in the global economy. The combined contributions of AFCAC and AASA will be critical to Focus Africa’s success. Africa accounts for 18% of the global population but less than 3% of global GDP and just 2.1% of air passenger and cargo transport activity. With the right interventions those gaps will be closed, and Africa will benefit from the connectivity, jobs and growth that aviation enables,” said Willie Walsh, IATA’s Director General.
Financing Climate-Resilient Infrastructure in Africa (ThinkTwenty (T20) India 2023)
Amidst rapidly escalating climate crises, there is an urgent need to enable African countries to remodel existing financial infrastructure with the aim of strengthening climate resilience and developing green infrastructure. As the world scrambles towards decarbonisation, the G20 nations, which represent the largest source of wealth, with 85 percent of global GDP, are well equipped to support vulnerable countries.
This Policy Brief proposes three mechanisms whereby the G20 can support African countries: providing grant funding and technical assistance to the Programme for Infrastructure Development for Africa (PIDA) to increase the number of high-quality bankable projects and mobilise financiers; strengthening the coordination of climate financing from the G20 countries to the continent; and unlocking financial technology and entrepreneurship to mobilise financing for bankable projects. This Brief further recommends that the G20 should use its technical capacity, financial muscle, and convening power to put African countries on the path towards climate resilience.
On World Oceans Day, DG Okonjo-Iweala welcomes EU acceptance of fishing subsidies agreement (WTO)
The European Union this week deposited its instrument of acceptance of the WTO Agreement on Fisheries Subsidies, marking a major development towards the Agreement’s entry into force. The EU’s instrument of acceptance was presented to Director-General Ngozi Okonjo-Iweala in Paris on the side lines of the Organisation for Economic Co-operation and Development’s (OECD) Ministerial Council Meeting by Minister for International Development Cooperation and Foreign Trade Johan Forssell of Sweden, which currently holds the Presidency of the Council of the EU; European Commission Executive Vice-President and Commissioner for Trade Valdis Dombrovskis; and European Commissioner for Environment, Oceans and Fisheries Virginijus Sinkevičius.
“On this day when the international community comes together to celebrate and protect our ocean, I urge more WTO members to ratify the Agreement on Fisheries Subsidies so it can enter into force, and start delivering sustainable benefits for marine fisheries, as soon as possible. I also call on all WTO members to continue and deepen their engagement in the second wave of fisheries subsidies negotiations, so that a successful conclusion can be reached at our 13th WTO Ministerial Conference next February in Abu Dhabi.”
Strong and effective WTO a vital tool for building economic resilience — DG Okonjo-Iweala (WTO)
Speaking to a ministerial gathering at the Organisation for Economic Cooperation and Development in Paris on 7 June, Director-General Ngozi Okonjo-Iweala said a strong and effective WTO is a vital tool for building resilience in an increasingly shock-prone global economy. She called for a strategy of “re-globalization” which would build greater resilience by bringing more marginalized countries and communities into the global economic mainstream.
In her address, the Director-General noted that “shortages and bottlenecks of the past three years have exposed genuine vulnerabilities in the way supply chains are organized.”
“A better path to resilience lies in deeper, deconcentrated and more diversified global chains, achieved by bringing more countries and communities from the margins of the global economy to the mainstream,” she told ministers. “At the WTO, we are calling this ‘re-globalization’.”
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Trade, Industry and Competition on Continental Free Trade Area ushering significant milestone journeying towards Economic Integration in Africa (South African Government)
The implementation of the African Continental Free Trade Area (AfCFTA) ushers in a significant milestone in our collective journey towards establishing a unified African market, promoting trade, and propelling sustainable and inclusive growth across the continent. This was said by the Director of Africa Bilateral Economic Relations at the Department of Trade, Industry and Competition (the dtic), Mr Calvin Phume, during the AfCFTA awareness workshop which took place in Johannesburg.
The workshop was part of a series that the dtic is rolling out nationally from May-July 2023. The inaugural workshop took place in KwaZulu-Natal last week and was a rousing success. Businesspeople who attended the session welcomed the progress and benefits that the AfCFTA will afford their respective businesses once implemented.
“The AfCFTA strives to ensure inclusivity, particularly for women, youth, and those residing in rural areas, while focusing on the development of small and medium-sized enterprises (SMEs) and overall industrialisation of Africa. As a flagship project of Agenda 2063, the AfCFTA aims to establish a unified African market for goods and services, facilitated by the free movement of individuals, capital, and investments. This integration will further promote sustainable and inclusive socio-economic development, gender equality, industrialisation, agricultural advancement, food security, and structural transformation,” he stated.
“By fostering awareness and understanding, we aim to empower participants to seize the abundant opportunities and benefits that the AfCFTA offers. The workshop showcased the government’s unwavering commitment to ensuring that all regions and communities are well-informed and actively participate in this landmark initiative,” said Phume.
Namibia’s trade deficit down almost 41 pct in April (Xinhua)
Namibia’s trade deficit fell in April to 1.3 billion Namibian dollars (about 87 million U.S. dollars), down 40.9 percent from the 2.2 billion Namibian dollars (about 148 million U.S. dollars) recorded in March, according to the latest figures released by the Namibia Statistics Agency (NSA).
In the year ending in April, Namibia’s monthly trade deficit averaged 2.4 billion Namibian dollars (about 161 million U.S. dollars), according to the NSA.
“For April 2023, Namibia’s export earnings decreased by 26.2 percent on a monthly basis, while the import bill decreased by 28.7 percent,” NSA Statistician General Alex Shimuafeni said, adding that the deficit was reflected in copper ores and concentrates and petroleum oils.
“South Africa emerged in the first position as Namibia’s export destination with a percentage share of 21.2 percent, while Botswana came second with a share of 16.2 percent, and China in the third position with a share of 11.4 percent,” Shimuafeni said.
In terms of imports, South Africa occupied the first position with a percentage share of 46.7 percent, followed by China with a share of 14.9 percent, and India in the third position with a share of 4.1 percent, he said.
Trade exchange between Egypt, South African countries up 6.5% YoY in 2022 (ZAWYA)
Trade exchange between Egypt and South African countries rose 6.5% year on year (YoY) in 2022 to $381.9 million, compared to $358.6 million, the Middle East News Agency (MENA) reported on June 7th, citing data by the Central Agency for Public Mobilization and Statistics (CAPMAS).
The country’s trade with Mozambique reached $30 million last year, up 85.8% from $16.1 million in 2021. Meanwhile, trade exchange between Egypt and Angola surged by 13% YoY in 2022 to $23 million from $20.4 million. Additionally, the Egyptian-Zambian trade reached $328.9 million last year, marking a 2.1% annual increase from $322.1 million in the year prior.
Trade exchange between Egypt, COMESA countries increases to $5.3bln in 2022: CAPMAS (ZAWYA)
The Central Agency for Public Mobilization and Statistics (CAPMAS) has revealed that the value of trade exchange between Egypt and the COMESA countries increased to $5.3bn in 2022, compared to $4.4b in 2021, an increase of 20.4%.
The agency indicated that the value of Egyptian exports to the COMESA countries increased to $3.4bn in 2022, compared to $3.1bn in 2021, an increase of 10.9%, while the value of Egyptian imports from the COMESA countries amounted to $1.9bn during 2022 compared to $1.3bn in 2021, with an increase of 42.4%.
Regarding the most important commodity groups that Egypt exported to the COMESA countries in 2022, the agency clarified that chemical products and plastics came in first place with a value of $1.1bn, then animal and plant products with a value of $782.3m, then marble, stones, ceramics and glass with a value of $267.7mi, then fuel and petroleum products with a value of $208.6m, then metal products with a value of $207.6m.
Nigeria, Netherlands modify treaty to strengthen economic cooperation (Daily Nigerian)
The Federal Government and the Kingdom of Netherlands have engaged in an Economic Consultation to modernize the existing bilateral investment treaty between both countries to strengthen economic interest and opportunities.
“This gathering of professionals would foster productive dialogue on Nigeria-Netherlands Economic Cooperation, the Investment Promotion and Protection Agreement (IPPA), Avoidance of Double Taxation Agreement (ADTA), and other legal frameworks.
“During this Economic Consultation, Nigeria is willing to explore further, areas of economic cooperation with the Netherlands in Agricultural value chain, secular economy, renewable energy, waterways management and water scarcity.
“Other areas are Oil and Gas, Special Economic Zones, African Continental Free Trade Area (AfCFTA), Economic Community of West African States (ECOWAS) and Trade facilitation in Western Africa, Science, Technology and Innovations (STI) Education and Health
New guidelines: Firms to bear biggest responsibility for pollution from their industries (The Standard)
The government is developing new guidelines that will see producers of waste bear the biggest responsibility for pollution caused by their activities.
Environment and Climate Change PS Festus Ng’eno said the guidelines will implement the Extended Producer Responsibility (EPR) legislation that will see manufacturers finance the management of waste from their industries during the entire life cycle of products they introduce to the market.
“They will also be expected to put measures in place to prevent pollution from their products while mitigating their environmental impacts. This will include collection and recycling of waste,” said Ng’eno who spoke in Nairobi at the three-day Africa Waste is Wealth that started on Tuesday.
EAC Partner States resolve 10 Non-Tariff Barriers as new ones emerge (EAC)
East African Community Partner States resolved a total of 10 Non-Tariff Barriers (NTBs) as four (4) new ones emerged. The 42nd Meeting of the Sectoral Council of Ministers on Trade, Industry, Finance and Investment (SCTIFI) that was held at the EAC Headquarters in Arusha, Tanzania was informed that eight (8) NTBs remained outstanding and were at different levels of resolution.
Among the resolved NTBs were a 25% excise duty imposed by Kenya on Ugandan table eggs and 25% Kenyan excise duty on onions, potatoes, potato crisps and chips from Uganda that became effective 1st July, 2022.
Also resolved was an import ban and denial of market access by Kenya through non-issuance of import permits for powdered milk from Uganda as a means of cushioning the surplus production and low producer prices in Kenya.
Another resolved NTB was that of 13 roadblocks between Nimule and Juba with Ugandan traders losing more than 150,000 South Sudanese pounds each. South Sudan reported that she had already complied with a SCTIFI directive to remove all roadblocks, adding that there are now only two roadblocks from Nimule to Juba.
Among the new NTBs is a complaint by Kenya that Uganda was denying market access to EAC Partner States under preferential treatment by charging full Common External Tariff of 35% to juices originating from Kenya.
16th COMESA Business Forum Kicks Off in Zambia (COMESA)
The 16th edition of the COMESA Business Forum kicked off today in Lusaka, Zambia with over 500 regional and international businesses participating the in the one-day event preceding the COMESA Summit.
The forum is a multisectoral platform for the promotion of quality products and services that are currently breaking ground in terms of high value and high demand in regional and international markets, with a focus on the COMESA market. The Forum and exhibition have been organised by the COMESA Business Council.
Zambia’s Minister of Commerce, Trade and Industry Mr Chipoka Mulenga opened the forum. He described it as most ideal for enabling the private sector to be more effective drivers of industrialization, economic diversification, trade and investment in the region.
“We need to ensure that our policies and strategies are coherent, consistent and complementary to support the overall goal of an integrated, prosperous and peaceful Africa, driven by its own people,” he said.
In her statement, Secretary General of COMESA, Ms. Chileshe Kapwepwe stressed the need for Public-Private Sector partnership in increase intra-COMESA Trade to spur the economic growth which has declined from 5.9% in 2021 to 4.8% in 2022.
Secretary General of the African Continental Free Trade Area (AfCFTA) Mr. Wamkele Mene said with the global Covid-19 pandemic now practically behind, it is time for African countries to reset, socially and economically.
Egypt president urges COMESA states to enhance regional integration to address current challenges (Ahram Online)
El Sisi’s remarks came at the 22nd COMESA Heads of State and Governments Summit in the Zambian capital Lusaka, held on Thursday. Egypt handed over the two-year presidency of the continental 21-member-state bloc to Zambia.
El-Sisi highlighted Egypt’s priorities during its chairmanship, which focused on advancing economic integration rates to enhance the level of well-being of our people and promote the capabilities of peace and security in our countries.
“However, despite the successes that have been achieved, we still have much to do to enable our regional integration to face the current challenges,” he said.
President El-Sisi stated that intra-COMESA trade rose to $13 billion in 2022, the highest value since establishing the free trade zone within the framework of the COMESA in 2000.
El-Sisi indicated that Egypt, in its capacity as COMESA chair, has focused on activating the African Continental Free Trade Area (AfCFTA) to boost economic growth, adding that the volume of trade exchange between Egypt and the COMESA countries reached $ 4.3 billion in 2022 – the highest amount since Egypt joined the bloc.
The country was also keen on achieving harmony between Egypt and the COMESA-EAC-SADC Tripartite Free Trade Area through specific measures to urge member states to implement customs exemptions and facilitate the movement of trade exchange among them, he said.
African Trade Accord Hugely Significant For Continent – UN Small Business Group Head (allAfrica.com)
The African Continental Free Trade Area accord is one of the most critical developments in African trade and integration, says the executive director of the International Trade Centre (ITC), the UN agency supporting small business.
Pamela Coke-Hamilton, who began her career in Jamaica’s foreign ministry and now heads the ITC, recently met journalists at the centre’s base in Geneva, where she spoke about “strategic re-globalization” as a major trend.
Coke-Hamilton described strategic re-globalization as “the new search for global corridors for trade routes” as a result of the Russia-Ukraine war and post-Covid changes.
She said the disruption of supply channels and a recognition that dependence on China is immense has led to the world looking for “near-shoring” and new supply routes.
The task of trade groups was now to assess new trends and address how strategic re-globalization is going to impact how countries engage with one another, Coke-Hamilton added. She said that “the AfCFTA is also a whole new open arena” in which the focus would be on regional value chains within Africa and “how those are going to impact new arenas of trade”.
The ITC has identified several important future regional value chains. “Those are automotive, pharmaceuticals, baby food, textiles and clothing. And there’s already discussion taking place on a regional value chain for electric batteries,” said Coke-Hamilton.
AU emphasizes streamlining border crossing points to accelerate AfCFTA implementation (News Ghana)
The African Union (AU) on Wednesday called on African countries to streamline border crossing points so as to accelerate the implementation of the African Continental Free Trade Area (AfCFTA) Agreement.
The call was made by Bankole Adeoye, AU Commissioner for Political Affairs, Peace and Security, on the occasion of the celebration of the 13th edition of African Border Day, which is annually commemorated on June 7.
“The rapid, safe and expeditious processing of the flow of people, goods and vehicles at border crossing points is indeed a guarantee of the acceleration of the implementation of the African Continental Free Trade Area,” Adeoye said in a statement.
Adeoye said significant progress is being made in Africa, notably with the signature of bilateral framework agreements between neighboring African states, agreements between decentralized structures, the creation and establishment of cross-border bodies, and the development and implementation of cross-border cooperation initiatives, among others.
“This encouraging dynamic must be sustained and amplified in all the cross-border areas of the continent. It must support and galvanize the acceleration of the implementation of the AfCFTA,” he said.
‘Allocate 10% of the Budget to Agriculture,’ CAADP Actors Urged Gov’t (Liberian Observer)
The Comprehensive Africa Agriculture Development Program (CAADP) Non State Actors Coalition in Liberia has called for strict adherence to the 10 percent budget for agriculture by the government.
The non-state actors’ coalition, comprising farmers, producer organizations, agribusiness owners, civil society organizations, and the media, said the government’s adherence to the 10 percent budget for agriculture will reduce unemployment and solve the problem of food insecurity.
According to members of the coalition, they will remain resolute or committed to engaging the government to see reason to prioritize the 10 percent public funding for the agricultural sector.
The CAADP Malabo calls for every African government to allot 10 percent of its total national budget annually for agriculture in order to reduce poverty, create jobs, and to improve food security in members’ countries.
Africa needs a unified air transport market to boost tourism & trade: COMESA official (Ahram Online)
COMESA’s Support to Air Transport Sector Development (SATSD) programme Team Leader Adikiny Olwenge’s remarks came during his participation in a recent workshop hosted in Egypt from 29-31 May to advocate for the development of an institutional framework for the environmental operation of communications and air transport under the COMESA and the Indian Ocean Region Programme.
The team leader explained that the SATSD programme aims to develop the air transport sector by activating the Single African Air Transport Market (SAATM), improving the efficiency of air navigation, and strengthening the regulatory and institutional capacity of civil aviation institutions within the COMESA grouping and Indian Ocean Region Programme.
To achieve these goals, he noted, the SATSD received an eight million euro grant from the European Commission in 2021 to support the efforts of the SATSD programme in the Eastern Africa, Southern Africa, and Indian Ocean Region Programme.
The goal here is achieving more regional and continental integration, he said.
Gender-Smart Investing Key for Women Economic Empowerment and Stronger Growth in North Africa (UNECA)
The ECA Office for North Africa and Oxford Economics Africa held on Wednesday 7 June a joint online workshop on “Gender-Smart Investing for Inclusive Growth in North Africa.” The event was an opportunity for ECA and Oxford Economics Africa to present the preliminary findings of a joint report on this topic to North African policymakers, academics, private sector, and development partners.
“The report underscores that female entrepreneurship and women-led SMEs tend to create more jobs for women. They are thus key for bringing North African women into the labour market and helping reduce the large gender gaps in employment in the region,” said Amal Elbeshbishi, an economist at the ECA Office for North Africa.
“By enhancing the economic opportunities for women, gender-smart investing also supports social, educational, and health outcomes. This in turn buoys sustainable development, job creation, and resilience during times of economic crisis,”said Cobus de Hart, Director of Consulting at Oxford Economics Africa.
The African Development Bank (AfDB) has committed to supporting East African countries to accelerate structural transformation, reinforce resilience, and create more decent jobs. This ambition is encapsulated in the Bank’s East Africa Regional Integration Strategy Paper (EA RISP) 2023-2027.
The strategy paper, approved by the Bank’s Board of Directors on 08 May, sets out two priority areas to achieve its main objective, namely: (1) Improve regional infrastructure; and (2) Support regional value chains development and trade facilitation.
Under the first priority area, the Bank will invest in cross-border electricity interconnections to strengthen connectivity and increase cross-border trade in electricity.
The African Development Bank will also commit financial resources to multimodal transport systems for roads, railways, air transport and inland waterways while continuing to strengthen transport management institutions’ capacity and regional corridors. Particular emphasis will be placed on the main corridors and feeder roads that link production centres to major markets and promote intra- and inter-regional connectivity.
Under the second priority area, the Bank will support the development of regional value chains, particularly agro-industry, manufacturing (textiles and clothing) and mining. The Regional Integration Strategy Paper aims to contribute to an increase in manufacturing value added in the region from 9% in 2020 to 11% in 2027 as a result of support to upstream interventions.
Retreat on African Union Institutional Reforms and Agenda 2063 (AU)
The African Union is convening a retreat to discuss the Institutional Reforms and the second decade of Agenda 2063.
The retreat will discuss the Institutional Reforms and the processes underway to reposition the organization to ensure it has the requisite institutional capacity to deliver on the economic, political, and social vision of the continent as encapsulated Agenda 2063. The reform agenda emphasizes on the need to focus on key priorities with a continental scope; realigning AU institutions to deliver on its objectives; operational efficiency, and sustainable self-financing the Union.
The retreat will also discuss the second ten-year plan of Agenda 2063 spans 2024 to 2033. Agenda 2063 was adopted by the 24th Session of the AU Assembly of Heads of State and Government in Addis Ababa in January 2015. The Agenda embodies the aspirations of the African people, framed in a collective ambition thus: “The Africa We Want in 2063”. The Agenda is operationalized through 5 ten-year implementation plans, with the first plan straddling 2014 to 2023. The second decade of Agenda 2063 implementation is one of acceleration, building on the first that focused on convergence.
ECOWAS Vision 2050 at the Heart of the Ecowas 48th Anniversary Celebration in the Republic of Guinea (ECOWAS)
he ECOWAS Permanent Representation in the Republic of Guinea, as part of ECOWAS 48th anniversary celebration and in accordance with its programme of activities, organised a series of activities to mark this historic date, 28 May 1975, when ECOWAS was established in Lagos, Nigeria. The celebration was launched by a message to the nation read out on national television on 29 May 2023 by the honourable Minister of Foreign Affairs, African Integration and Guineans Living Abroad, Dr. Morissanda Kouyaté.
On 3 June 2023, a conference on ECOWAS Vision 2050 was held on three (3) themes, namely:
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“ECOWAS Vision 2050, ECOWAS of the People, Peace and Prosperity for all; a Factor for Regional Integration”.
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“Challenges of the Free Movement of People and Goods within the ECOWAS region”.
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“The Role of ECOWAS Permanent Representations in the Promotion of Democracy and Good Governance in Member States”.
From Aid to Enterprise: Rethinking Development Strategies in Africa (The Tony Elumelu Foundation)
Africa, with its immense potential and untapped resources, has long been a focal point of international development efforts. Traditionally, aid has been the primary approach to addressing the continent’s socio-economic challenges. However, in recent years, there has been a growing recognition that aid alone cannot sustainably transform Africa’s fortunes. The Tony Elumelu Foundation advocates for a paradigm shift, from aid dependency to a focus on entrepreneurship and enterprise development, as a more effective strategy for unlocking Africa’s true potential. By empowering African entrepreneurs and fostering a culture of entrepreneurship, we can lay the foundation for sustainable, inclusive, and home-grown development across the continent. Based on key findings from our years of research and engagement in the African entrepreneurship ecosystem, we have narrowed down the key approaches that the world can adopt to transform its engagement with Africa.
While aid has played a crucial role in addressing immediate humanitarian crises and providing essential services, it often falls short in creating self-sufficiency and sustained long-term development. Aid flows can be unpredictable and subject to geopolitical shifts, creating dependency and inhibiting local agency. Moreover, aid can inadvertently undermine local industries, discourage innovation, and perpetuate a cycle of dependency. It is time to challenge the status quo and explore alternative approaches that empower Africans to take charge of their own destiny.
Collaboration and regional integration are critical for maximizing the impact of entrepreneurship in Africa. By encouraging intra-African trade, harmonizing policies, and promoting cross-border cooperation, we can unlock the potential of regional markets and create economies of scale. Collaborative initiatives, such as the African Continental Free Trade Area (AfCFTA), provide a framework for deeper integration and increased trade, enabling entrepreneurs to access larger markets and expand their businesses across borders.
The shift from aid to enterprise represents a bold and necessary step towards a sustainable and prosperous Africa.
Financing Climate-Resilient Infrastructure in Africa (Observer Research Foundation)
Amidst rapidly escalating climate crises, there is an urgent need to enable African countries to remodel existing financial infrastructure with the aim of strengthening climate resilience and developing green infrastructure. As the world scrambles towards decarbonisation, the G20 nations, which represent the largest source of wealth, with 85 percent of global GDP, are well equipped to support vulnerable countries.
This Policy Brief proposes three mechanisms whereby the G20 can support African countries: providing grant funding and technical assistance to the Programme for Infrastructure Development for Africa (PIDA) to increase the number of high-quality bankable projects and mobilise financiers; strengthening the coordination of climate financing from the G20 countries to the continent; and unlocking financial technology and entrepreneurship to mobilise financing for bankable projects. This Brief further recommends that the G20 should use its technical capacity, financial muscle, and convening power to put African countries on the path towards climate resilience.
Civil Society Engagement At Core Of US-African Relations In Multipolar World (Eurasia Review)
United States has held its 8th annual civil society forum to review progress, examine challenges and renew interest in forging ways to strengthen relations with Africa. United States has the largest African diaspora which has close-knitted business, educational and cultural links with African countries. This helps to support official efforts in promoting relations with Africa.
In December 2022, the African Union Ministers of Trade from the AGOA-eligible countries met in Washington, DC, at the request of Ambassador Katherine Tai, USTR, “to have a full and frank exchange of views on how to work together to improve the utilization rates under AGOA and ensure that the program can be an effective tool for development.”
At those high-level engagements, there was consensus that there is a need to extend AGOA beyond 2025. The recommendation has been tabled before the US Administration.
During the meeting, Ambassador Tai, the African Ministers, and the Africa Group of Ambassadors also underscored the following: • An extension of AGOA for at least ten years with the inclusion of ALL African countries • The importance of Africa speaking with One Voice in all US-Africa trade and investment engagements; and, • Enhanced commercial diplomacy between the US and Africa. There was also agreement that South Africa would host the next AGOA Forum in August/September this year.
Patel again expresses optimism that South Africa will retain Agoa status (Engineering News)
rade, Competition and Industry Minister Ebrahim Patel has again expressed optimism that South Africa will be able to convince the US Congress to extend South Africa‘s designation as an African Growth and Opportunity Act (Agoa) beneficiary beyond 2025, when the unilateral trade programme is due to expire.
South Africa‘s continued designation as an Agoa beneficiary has come into question in recent months, owing to diplomatic tensions over an alleged sale of arms to Russia by South Africa in December.
South Africa is the continent’s largest non-oil beneficiary of Agoa, exporting a wide range of products, including automobiles, mining and chemical products, as well as agricultural goods such as citrus, wine and macadamia nuts.
“We are working closely with a number of African countries to have it [Agoa] renewed and extended again,” Patel said, noting that South Africa also faced difficult negotiations ahead of the previous expiry date of 2015 when the US objected to protection South Africa had extended to its poultry industry.
First-ever official data on illicit financial flows now available (UNCTAD)
Afghanistan, Bangladesh, Colombia, Ecuador, Maldives, Mexico, Myanmar, Nepal and Peru have produced the first-ever national estimates of illicit financial flows (IFFs) related to drug trafficking, trafficking in persons and smuggling of migrants with the support of the UN Office on Drugs and Crime (UNODC).
The estimates are published on the UN’s Global Sustainable Development Goals (SDGs) Indicators Database. And a recent UNCTAD infographic report showcases preliminary estimates and findings on tax and commercial IFFs from 11 African countries.
Significantly reducing IFFs by 2030 is one of the priorities under the UN’s SDG 16. UNCTAD and UNODC are co-custodians of SDG indicator 16.4.1, which measures the total value of inward and outward IFFs in current US dollars.
“Such statistics are needed to shed light on the activities, sectors and channels most prone to illicit financial flows, pointing to where actions should be undertaken as a priority to curb these flows,” said Anu Peltola, who heads UNCTAD’s statistics work.
Why the World Still Needs Trade (Foreign Affairs)
Since 1990, the share of the world’s population living in extreme poverty has fallen by three-quarters. At the center of this great leap in human well-being was a 20-fold increase in international trade volumes, which helped lift per capita incomes by a factor of 27 over the last six decades.
This economic vision is now under attack, and its achievements are in danger. A series of shocks in the space of 15 years – first the global financial crisis, then the COVID-19 pandemic, and now the war in Ukraine – have created an alternative narrative about globalization. Far from making countries economically stronger, this new line of thinking goes, globalization exposes them to excessive risks. Economic interdependence is no longer seen as a virtue; it is seen as a vice. The new mantra is that what countries need is not interdependence but independence, with integration limited at best to a small circle of friendly nations.
But dismantling economic globalization and the structures that support it would be a mistake. That is because, despite persistent rhetoric to the contrary, countries and people rely on trade more than ever in this age of “polycrisis.” Moreover, international cooperation, including on trade, is necessary to meet challenges to the global commons, such as climate change, inequality, and pandemics. Globalization is not over, nor should anyone wish for it to be. But it needs to be improved and reimagined for the age ahead.
World Oceans Day underscores need to protect ‘the foundation of life’ (UN News)
UN Secretary-General António Guterres has called for greater action to protect oceans in his message to mark World Oceans Day on Thursday. “The ocean is the foundation of life. It supplies the air we breathe and food we eat. It regulates our climate and weather. The ocean is our planet’s greatest reservoir of biodiversity,” he said.
Besides these benefits, the ocean also produces resources that sustain communities, prosperity and health. Worldwide, more than a billion people alone rely on fish as their main source of protein.
The UN chief said human-induced climate change is heating the planet, disrupting weather patterns and ocean currents, and altering marine ecosystems and the species living there.
Marine biodiversity is also under attack from overfishing, over-exploitation and ocean acidification, fish stocks are being depleted, and coastal waters have been polluted with chemicals, plastics and human wastes.
The Southern African Development Community (SADC) joins the global fraternity to commemorate this year’s World Ocean Day with a call for our region to enhance the conservation of oceans, including coastal areas, and their resources. The state of our oceans call for SADC Member States and partners to implement policies and programmes that will reduce plastic pollution, expand protection of marine areas, enhance tackling of illegal fishing and promote responsible fishing practices.
I appeal to develop effective monitoring and mechanisms to ensure compliance with existing regulations as outlined in the SADC Protocols for Fisheries, and Wildlife Conservation and Law Enforcement, and also in existing Regional Strategies on Biodiversity, Fisheries Monitoring Control and Surveillance, Green Economy and Climate Change. To complement existing policy instruments and frameworks, the SADC region is finalising the development of Regional Strategies on Blue Economy, Circular Economy and Action Plan to Combat Marine Pollution to adequately conserve oceans in order to secure sustainable development of our countries and livelihoods of local communities.
It is my hope that Member States in our region, and all stakeholders will collaborate in promoting sustainable development in the ocean or blue economy, through investments in renewable energy, marine tourism and sustainable aquaculture as key drivers of economic growth.
World off track for reaching key goal on sustainable energy by 2030 (UN News)
Tracking SDG 7: The Energy Progress Report, from the International Energy Agency (IEA), the International Renewable Energy Agency (IRENA), the UN Statistics Division (UNSD), the World Bank, and the World Health Organization (WHO), warns that current efforts are not enough to achieve the SDG 7 on time.
There has been some progress on specific elements of the drive to reach SDG 7 – for example, the increased rate of using renewables in the power sector – but progress is insufficient to reach the targets set forth, in time for the 2030 deadline.
SDG 7 is to ensure access to affordable, reliable, sustainable and modern energy. The goal includes reaching universal access to electricity and clean cooking, doubling historic levels of efficiency improvements, and substantially increasing the share of renewables in the global energy mix, said the report.
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IMF Executive Board Concludes 2023 Article IV Consultation with South Africa
South Africa’s strong economic recovery from the COVID-19 pandemic is petering out. Growth moderated from 4.9 percent in 2021 to 2.0 percent in 2022 as the country was buffeted by Russia’s war in Ukraine, global monetary policy tightening, severe floods, and an unprecedented domestic energy crisis. Inflation rose above the target band though inflation expectations remained anchored. The current account moved back into a deficit after a temporary commodity-price driven surplus.
Externally, downside risks stem from slower trading partners’ growth, especially in China, further weakening of commodity prices, the impact of the FATF grey listing on capital flows, and tighter global financial conditions. More persistent high global fuel and food prices could de-anchor inflation expectations, and further raise risk premia. Systemic financial instability in advanced economies could cause adverse spillovers. Deepening geo-economic fragmentation could lower medium-term growth outlook, including through lower trade and financial flows, technology diffusion, and a fracturing of the international monetary and financial systems. On the upside, external demand for coal and precious metals could remain strong, strengthening South Africa’s relative position in the EM asset class (Annex I).
Deeper regional trade integration would benefit South Africa. The African Continental Free Trade Area (AfCFTA) is a good opportunity for South Africa to build on its industrialized economy, exploit economies of scale, and improve productivity and growth.24 Efforts to remove trade barriers, especially non-tariff barriers, will help boost intra-regional trade and help develop regional supply chains. Industrial policies, where desirable, should address specific market failures to promote competition and exports in concerned industries and technological advancement.25 They should also avoid discriminatory contents that violate international trade rules or accentuate trade tensions.
South Africa has diversified commodity and export markets, which help mitigate global shocks. South Africa has diversified its export destinations, with 34 percent of its exports going to advanced economies, 30 percent to emerging and developing Asia and 23 percent to sub-Saharan Africa (Figure AI.3, Panel 4). The key export products are coal, iron, precious metals (such as gold, palladium, platinum, and rhodium), and manufacturing goods, including cars. This composition of trade has served the country well since, after Russia’s invasion of Ukraine, strong demand for and high prices of coal boosted the current account despite prices for precious metals coming down from the pandemic peaks.
SA’s GDP grows by 0.4% in first quarter (SAnews)
Statistics South Africa (Stats SA) announced on Tuesday that the country’s gross domestic product (GDP) grew by 0.4% in the first quarter of 2023. Data show that the manufacturing and finance industries were major drivers of growth on the supply side of the economy.
“The demand side was lifted by exports, with smaller positive contributions for household, government and investment spending,” Stats SA said in a statement. According to Stats SA, eight out of 10 industries recorded growth in the first three months of the year, with manufacturing and finance, real estate and business services the largest positive contributors. Manufacturing output increased by 1.5%, adding 0.2 of a percentage point to GDP growth.
“Air transport, transport support services and communications also witnessed stronger economic activity, contributing to the industry’s positive reading.”
“Exports increased by 4.1% in Q1:2023. The rise was largely influenced by increased trade in metals; vegetable products; prepared foodstuffs, beverages & tobacco, and machinery & electrical equipment,” said Stats SA.
Kenya’s Economy is Recovering from the Polycrisis, But Challenges Remain (World Bank)
With a GDP growth at 4.8 percent in 2022, economic performance softened after the strong rebound from the COVID-19 crisis at 7.5 percent in 2021. The growth rate, however, has remained in line with Kenya’s long-term growth trajectory, even though the economy faced challenging global financial conditions, fuel, and food price shocks coupled with the elections, and a historic drought that affected the economy, especially in the second half of 2022.
The growth momentum was driven by the service sector which contributed about 80 percent of the increase in total GDP. Financial services, tourism, and transport sectors performed especially strongly. According to the latest Kenya Economic Update (KEU), Kenya’s GDP growth outpaced that of Sub-Saharan Africa which is estimated to have grown at 3.6 percent in 2022.
Kenya’s medium-term growth outlook remains strong as the economy continues to recover from the multiple crises. GDP growth over the medium term is expected to remain at around 5 percent, broadly in line with the pre-pandemic trend and Kenya’s estimated potential GDP growth rate. Real per capita incomes are expected to grow at around 3 percent in the medium term, and poverty is expected to resume its pre-pandemic downward trend.
The outlook, however, is subject to elevated risks. External risks include weaker than anticipated growth in Europe, elevated global commodity prices that can increase Kenya’s import bill and increase the cost of reducing inflation, and further tightening of financial conditions in advanced economies. Domestic risks are mostly linked to spending pressures to reduce the high cost of living and a slowdown in tax efforts.
Kenya’s trade surplus with Africa hits record levels (Business Daily)
Kenya’s goods trade surplus with Africa reached record levels in the first three months of the year driven by the fastest growth in exports for 12 years and a first fall in expenditure on imports in three years, official data shows.
Traders sold goods worth Sh98.85 billion to African countries in the January-March 2023 period against an import bill of Sh61.72 billion, according to provisional data collated by the Central Bank of Kenya.Earnings from exports in the period were 23.33 percent higher than the previous year, the strongest growth since 2011, while imports fell 6.02 percent year-on-year from Sh65.67 billion in 2022.This resulted in a merchandise trade surplus of Sh37.14 billion for the review period, a 156.45 percent climb over the same period last year.
Services sector will create 85m jobs in Nigeria, others by 2030 – McKinsey (Businessday)
The services sector is projected to create at least 85 million net new jobs across Africa by 2030, a new report has said. The report, titled ‘Reimagining economic growth in Africa: Turning diversity into opportunity’ by McKinsey & Company, said Africa will be home to the world’s largest working-age population by 2040, and smart deployment of its labor force in highly productive jobs will spur economic growth.
“By 2030, the services sector on its current trajectory will create at least 85 million net new jobs across the continent, enough to absorb half of new labor market entrants in highly productivity work,” it said. It said the number of new services jobs would almost triple if Africa matched the productivity of Asia’s strongest services hub, which would add $1.4 trillion to the continent’s economy.
“Services have secured their place as the major driver of the continent’s economic output, contributing 56 percent in 2019 compared to 50 percent in 2000. The sector presents significant opportunities for African countries to boost economic output and job creation—but only if productivity improves,” it said.
TBS urges producers to use free standards verification services (IPPMedia)
TBS Northern Zone manager, Engineer Joseph Mwaipaja said made a call while briefing to journalists who visited the bureau’s pavilion at ongoing 10th TCCIA-Tanga Trade and Tourism Exhibition which is taking place at Mwahako grounds in Tanga city.
He said that, product classification is vital into devising a marketing strategy that helps to create effective customer - centric marketing strategies.
He explained that Tanga had recently became international trades gateway region after the government implement numerous strategic mega projects like improvement of Tanga Port and East Africa Crude Oil Pipeline(EACOP), by pointing out that the projects will be a game changer by bringing other entails opportunities by increasing high demands of goods henceforth those entrepreneurs issued with certificate standards will pave the way to them to have vast chances to compete and sell more in East African markets.
He further explained that according to available data, until end of July this year, about 30 producers and business people of Tanga region will be offered certificates of standards verification by TBS.
“These are great developments and give hopes and we TBS pledge to continue implementing programs of educating entrepreneurs on the importance of possess TBS verification certificates that will boost them to conduct their business competitively,” he said.
Morocco fruit & veg supply secured as court rules against trade lawsuit (The Grocer)
Supply of Moroccan fruit & veg has been safeguarded, as a legal suit against trade between the Northern African nation and the UK has been rejected.
Campaigners had taken the government to the High Court over a post-Brexit trade agreement with Morocco, arguing it was negotiated without the consent of people from the Western Sahara territory, a heavily disputed region of the country. But a judge has now permanently ruled that the case against the UK Morocco Association Agreement, a deal first concluded in 2019, cannot be further appealed.
The ruling has removed a potential risk of disruption to the import of Moroccan goods, which UK supermarkets heavily rely on.
Recent trade figures showed the UK imported more than £400m of fruit and vegetables from Morocco, making up a third of all imports from the African nation. Trade between the two countries grew almost 50% year on year to Q4 2022.
“We are now entering a new era of relations for the UK and Morocco that will drive prosperity to the benefit of all parties,” said Chakib Alj, president of Morocco’s leading business group, the General Confederation of Enterprises in Morocco (CGEM).
The Gambia’s Economy Shows Resilience Amid Global Challenges (World Bank)
The report highlights that the weak growth in the services sector, particularly in tourism, has restrained The Gambia’s economic progress. Although there was an increase in the number of tourist arrivals, it was not sufficient to offset the sluggish growth in other subsectors. Furthermore, trade disruptions and negative terms of trade have weighed on the economy, as the country is a net oil and commodity (food) importer and recorded negative terms of trade in 2022.
The Gambia’s economy has displayed remarkable resilience in the face of global economic challenges, according to the Third Gambia Economic Update. Despite a sluggish global environment, the country’s real GDP grew by 4.3 % in 2022, signaling a continued recovery from the impact of the COVID-19 pandemic.
Looking ahead, the economic outlook for The Gambia remains favorable, with GDP projected to grow by 5.5 % over the period of 2023-2025. Growth will be supported by increased economic activity across sectors, particularly in industry and services. However, risks such as a prolonged war in Ukraine, fiscal slippages, climate change, and political uncertainty pose downside risks to the country’s economic prospects, exacerbating existing structural constraints to the economy.
“It is crucial for the government to implement policies that accelerate financial inclusion, which will enhance access to financial services and support the country’s economic growth,” said Ephrem Niyongabo, World Bank Economist and Author of report
Libya’s Economy Shows Resilience and Potential for Prosperity Amid Challenges (World Bank)
Libya’s economy shows resilience despite facing low and volatile economic growth. The World Bank estimates a 1.2 percent contraction in Libya’s economy for 2022, primarily attributed to a decline in oil production during the first quarter of the year. High unemployment rates of 19.6 percent persist, with over 85 percent of the working population engaged in the public and informal sectors.
Libya’s challenging transition process has been affecting the economy and society; the country experienced a 50 percent decline in GDP per capita between 2011 and 2020. Absent the conflict, the economy could have witnessed, on the contrary, a high positive growth of 68 percent over the ten years growth, a possibility that remains attainable and highlights the country’s enormous potential.
Despite facing significant challenges, Libya has a high potential for economic reconstruction and diversification, backed by considerable financial resources. This potential resides on four pillars: i) achieving a sustainable political agreement for Libya’s future, ii) devising a shared vision for economic and social advancement, iii) creating a modern public financial management system for equitable wealth distribution and transparent fiscal policies, iv) and developing a comprehensive social policy that facilitates public administration reform and differentiates between social transfers and public wages. These elements will set the foundation for Libya’s prosperous future.
EAC states to charge 10 US dollars road toll (Tanzania Daily News)
The East African Community (EAC) member states have agreed to charge 10 US dollars per 100 kilometres as a road toll for cargo trucks to strengthen provision of customs services at the borders. The agreement was reached at the 42nd meeting of the Ministers of Sectoral Council on Trade, Industry, Finance and Investment (SCTIFI) held at the EAC Headquarters in Arusha at the weekend.
Speaking after the meeting, the Minister for Investment, Industry and Trade Dr Ashatu Kijaji and Minister for Finance and Planning, Dr Mwigulu Nchemba said the rate is for vehicles from one country to another within the community instead of each country having its own toll rates.
“We have agreed to charge 10 US dollars per 100 kilometres as roads user charges for cargo trucks to the member countries instead of each country charging its charges as well as strengthening the provision of customs services at the border of Kenya and Tanzania which will reduce congestion of trucks and stimulate business growth,” said Dr Kijaji.
In addition, the sectoral council agreed to abolish the cost of visas for their citizens who want to travel from one country to another (within EAC) for various activities including business to promote relations among the residents of the community as well as stimulate the growth of business and the economy of the respective country.
New push for households to have own grain reserves (The Standard)
Households should have their own grain reserves as one of the solutions to food insecurity, a regional private sector body has suggested. This would be in addition to the national strategic food reserve, where millers would buy grains when there is a shortage at subsidised prices.
The East African Business Council (EABC) in a report that analyses the effect of food inflation in the region, also wants East African Community (EAC) partner states to allow for emergency exports in times of shortage.
The Impact of Global Crises on Food Security in East African Community report looks into the member states’ cereal imports, exports, and affordability. It details interventions that if implemented can be of benefit to the countries.
The report released last month covers the seven EAC member states. It shows the gaps in the production value chain and calls for increased trade within the region to expand the capacity of farmers to produce more. It details the deficiencies in food security using food imports over total merchandise exports, particularly cereal dependency.
“In the EAC region, Burundi, Kenya, and Rwanda had the highest import dependencyratios,” the report says. “This could be due to their staple foods mainly being cereals, which are not adequately produced in their respective countries.” Uganda and Tanzania, on the other hand, seem to import less of the food, possibly because they are able to meet their local needs as cereals also constitute some of their staple foods.
greater regional trade integration and resilient transport infrastructure will enable sales of one country’s bumper harvests to its neighbours facing shortages. “Tariff reduction and regional alignment of agricultural and product market laws and regulations, especially with respect to water, seeds, and fertiliser will all be elemental,” the report adds. “Expansion of producer organisations can facilitate the adoption of new technologies, scale up food production and distribution, and support price stability.”
COMESA Summit and Business Forum to Focus on Economic Integration (263Chat)
The Common Market for East and Southern Africa (COMESA) will hold its 22nd Summit and a high-level Business Forum in Lusaka, Zambia, from June 6-8, 2023. The summit, held under the theme “Economic Integration for a Thriving COMESA Anchored on Green Investment, Value Addition and Tourism” will also see Zambia assume the leadership of the bloc.
In a statement, COMESA said the theme was motivated by the need to address the current regional and global economic and trade dynamics, including the effects of COVID-19, which especially affected tourism-dependent economies.
The summit will be preceded by the 16th COMESA Business Forum on June 7. The Business Forum will focus on engaging public and private stakeholders on solutions that will propel and transform COMESA into competitive and sustainable growing economies for regional and global trade and investment expansion post COVID-19.
AfCFTA’s promising future: Boosting African trade amidst obstacles (Business Insider Africa)
“Only a few hundred kilometers separate Lagos, Nigeria, from Accra in Ghana but for the thousands of traders who ply this route, the journey through these routes can take a full day. Customs officials and police at roadblocks will make you unload and unpack every little package in order to delay you for hours,” Lucia Quachey, the secretary-general of the African Federation of Women Entrepreneurs, stated.
She also pushed for the construction of infrastructure to facilitate commerce and for the removal of several tariffs and non-tariff obstacles.
Maersk (Maersk) today discussed and presented papers on ‘Logistics 4.0: Accelerating Africa’s Digital Revolution’ at a closed-door session with some of the top CEOs from Africa.
To participate in global trade, it is extremely important to be competitive at all levels – be it in terms of costs or ease of doing business. Several complexities in the African supply chains have limited the Logistics Performance Index for African countries in the past. However, a lot of these complexities can be overcome with the use of technology and digital solutions.
Digitalisation is crucial in reducing logistics cost and supply chain complexities, which will in turn improve the Logistics Performance Index in Africa. Enhanced visibility, streamlined procurement processes and data-driven decision-making will drive competitiveness in Africa’s logistics, said Darryl Judd, Regional Head for Integration and Business Growth, Maersk Indian Subcontinent, Middle East and Africa (IMEA)
Measuring informal cross-border trade is key to monitoring intra-African Trade (UNECA)
Despite its importance to the livelihoods of millions of Africans, informal trade is not well understood on the continent. As a result, the African Union Commission (AUC) with support from the Economic Commission for Africa (ECA) and the Afreximbank established a Task Force on developing a harmonized methodology for Informal Cross-Border Trade Data Collection.
Opening a two-day hybrid meeting to review and validate the Continental Methodology for Informal Cross-Border Trade Data Collection in Africa, Stephen Karingi, the Director of Regional Integration and Trade at the ECA said informal cross-border trade is a key feature of Africa’s trade landscape.
“Despite its significant contribution to the economy, ICBT remains largely undocumented,” Mr. Karingi said, noting that current efforts to collect data on ICBT within the continent, were largely fragmented and unsystematic.
“The challenges related to ICBT data collection notwithstanding, understanding the ICBT landscape is important for policy design as well as the development of the relevant initiatives targeted at the major trade corridors within our countries and regions,” Zambia Statistics Agency Interim Statistician General, Mulenga Musepa said, highlighting that National Statistical Offices need to conduct timely ICBT data collection which should be institutionalized at the country level to ensure its sustainability.
Value addition will rev up Africa’s economic growth (Business Daily)
Africa is home to abundant mineral resources, including 30 percent of the world’s reserves, such as oil, natural gas, gold, and valuable metals like chromium and platinum. The Continent also holds the largest reserves of cobalt globally, with the Democratic Republic of Congo (DRC) alone accounting for nearly half of the total global cobalt reserves of 8.3 million metric tonnes.
However, despite this resource abundance, Africa has predominantly relied on commodity production and exports, with limited value addition and weak linkages to other sectors of the economy. Without immediate action, Africa’s manufacturing industry is likely to remain small in the coming years.
African countries can leverage the African Continental Free Trade Area (AfCFTA) to boost value addition. AfCFTA, established in 2021, creates a single market for goods and services, allowing free movement across the continent. By eliminating tariff barriers and expanding market access, African countries can diversify their economies and enhance their value-addition capacity.
The success of the AfCFTA and EAC efforts depends on establishing a robust pan-African logistics framework that facilitates smooth cargo flow and boosts trade across the continent, as well as linking Africa’s value-added goods to global consumer markets.
Africa possesses significant mineral reserves, but its heavy reliance on commodity production and exports limits its value-addition potential. However, initiatives like the EAC and AfCFTA provide opportunities to promote industrialisation, diversify economies, and enhance value addition.
WTO Chief urges African governments to increase trade, agric investment (Citi Business News)
The Director-General of the World Trade Organization (WTO), Dr Ngozi Okonjo-Iweala, has called on African countries to create trading opportunities and increase investment in agriculture to address food security in Africa.
In a speech read on her behalf at the 8th Africa Agribusiness and Science Week (AASW8) in Durban, Dr Okonjo-Iweala noted that one-fifth of Africa’s population continues to face hunger despite being “a continent with the world’s largest reserved arable land.”
explained that various governments need to take steps “to reinforce the provision of public goods”. This can be done by “improving the availability of extension and advisory services, investing in research, promoting access to technology, science and innovation, and improving infrastructure in rural areas,” she noted.
Highlighting the need for trade integration through AfCFTA, she said that “trade can connect producers and consumers across the [African] continent and beyond. It can also help to improve agricultural productivity and create jobs in rural areas”.
Where does southern African sit in the global trade scenario? (Seatrade Maritime)
With about 90% of cargoes brought to Western Europe coming from the Far East (Asia), the need to reassure clients and end-users becomes ever more pressing as we navigate through a new era where global supply chains are challenged by unpredictability.
Whether caused by Covid-related lockdowns and congestion, or the ongoing conflict in Ukraine, supply chains are in need to diversification if they are to stay resilient against another potential shock in the future. The search for resilience has, therefore, led to several manufacturers to consider reshoring as a possibility – and in some cases, the term evolves to “friendly-shoring”. While transpacific trade has dominated the scene in recent decades, shipping lanes and supply chains connecting Europe and Asia are faced with more options, not just in terms of trade corridors but also for manufacturing, which places the African continent on the spotlight.
if the continent – and especially the southern African region – is to become an attractive production alternative for global supply chains, it needs to improve its port, inland and manufacturing infrastructure. Significant milestones have taken place in this regard, such as recent commission of 750,000 TEUs that Namports (Namibian Ports Authority) have commissioned for Walvis Way, to which TiL Group has been appointed, the Port of Maputo in Mozambique, where DP World operates, leading to the Maputo corridor, and the recent investment in port and railway networks across the region.
DP World partners Standard Bank to expand trade finance in Africa (African Review)
African companies looking for trade finance will now be able to seamlessly access working capital from Standard Bank via the DP World Trade Finance platform. DP World Trade Finance connects business with financial institutions as a fintech platform while also directly offering trade finance facilities on its own. It offers businesses a single window to access trade finance solutions.
Access to finance is one of the biggest barriers for businesses seeking global trade opportunities, evidenced by the struggle that many businesses face in securing the upfront funds required to move cargo. By bringing Standard Bank onto the platform, DP World Trade Finance now offers an array of financing solutions to African businesses, which face an ever-growing need for logistics and financial support to connect to global trade routes.
Afreximbank and Fiducia join forces to promote factoring and supply chain finance in Africa (Afreximbank)
In a move that is set to change the face of supply chain and SME financing in Africa, the African Export-Import Bank (Afreximbank) and the supply chain financing company, Fiducia, have entered into a Memorandum of Understanding (MoU) to promote factoring across the continent and help reduce the supply chain finance gap.
Mrs. Awani, the Afreximbank Executive Vice President, said that the partnership with Fiducia was another step forward in Afreximbank’s ongoing developmental initiative of promoting factoring across the African continent as a means to reduce the trade finance gap which was most acutely felt by SMEs.
“SMEs contribute the majority of economic output and employment generation in Africa. Greater access to bank financing will, therefore, enhance the growth of this vital segment. The involvement of emerging factors in the financing arrangement will also build factoring capacity across the continent in furtherance of Afreximbank’s vision of Transforming Africa’s Trade,” commented Mrs. Awani.
Blog: Sustainable Production and Trade – Perspectives from the Commonwealth (The Commonwealth)
International trade can be a driver of inclusive economic growth and a means to achieve the Sustainable Development Goals (SDGs). To promote sustainability across the economic, social and environmental dimensions, trade policies have been evolving at the domestic and international levels.
On the occasion of the second Commonwealth Trade Ministers Meeting on 5-6 June 2023, a new book by the Commonwealth Secretariat, Sustainable Production and Trade: Perspectives from the Commonwealth, examines sustainable production and trade practices and governance arrangements in four sectors: cocoa, fisheries, forestry, and textiles and garments. This blog explores some of the sustainability challenges in each sector and highlights measures to address these across the Commonwealth.
These sectors hold significant importance to Commonwealth members, as reflected in their average export share from 2019 to 2021: 16% for fisheries, about 20% for forestry, nearly 16% for cocoa, and 14.5% for textiles and garments. All four sectors are labour intensive, making them crucial to the economic growth and job creation in developing countries, particularly in least developed countries (LDCs) and small states. The importance of these sectors is also highlighted by their high trade reliance in various geographical regions of the Commonwealth
Moving fast with frontier technologies (UNCTAD)
In the last two decades, the use of frontier technologies such as artificial intelligence, the Internet of things and energy from renewable sources has undergone significant growth, and this trend is expected to continue. However, there is still considerable concentration in these markets.
The leading frontier technology providers are mostly firms from China, the United States of America and a few other developed countries, with little participation from developing countries. The same pattern is observed with regard to knowledge generation and trade.
Governments of developing countries should take proactive action to increase preparedness to use, adopt and adapt such technologies and to take up the economic opportunities linked to them. Some of the challenges associated with the adoption of new technologies in developing countries are addressed in this policy brief, and some policy recommendations are proposed.
Global economic outlook improving, albeit to a low growth recovery (OECD)
The global economy has begun to improve, but the recovery will be weak, according to the OECD’s latest Economic Outlook. The Economic Outlook projects a moderation of global GDP growth from 3.3% in 2022 to 2.7% in 2023, followed by a pick-up to 2.9% in 2024. Lower energy prices are easing the strain on household budgets, business and consumer sentiment are recovering, albeit from low levels, and the re-opening of China has provided a boost to global activity.
The Outlook lays out a series of policy recommendations, underlining that the need to lower inflation, adjust fiscal policy and promote sustainable growth entails significant challenges for policy makers.
Monetary policy should remain restrictive until there are clear signs that underlying inflationary pressures are durably reduced. Fiscal support, which has played a vital role in helping the global economy through the pandemic and the war in Ukraine, should be scaled back, becoming more targeted and calibrated toward future needs. Broad energy-related support should be withdrawn as energy prices fall and minimum wages and welfare benefits are being increased to take account of past inflation in many countries.
“Fiscal policy should prioritise productivity-enhancing public investments, including those driving the green transition and boosting labour supply and skills,” OECD Chief Economist Clare Lombardelli said. “Renewed reform efforts to reduce constraints in labour and product markets and to reignite private investment and productivity growth would improve sustainable living standards and strengthen the recovery from the current low growth outlook.”
The Outlook includes a special chapter dedicated to women’s economic empowerment, setting out policy recommendations, including on expanding flexible work arrangements, addressing tax and benefit disincentives and improving access to childcare. It highlights that removing structural barriers and discrimination to realise gender equality, must be a high priority to boost long-term economic well-being and prosperity.
Global Economy on Precarious Footing Amid High Interest Rates (World Bank)
Global growth to slow to 2.1% in 2023, with prospects clouded by financial risks, according to the World Bank’s latest Global Economic Prospects report.
“The world economy is in a precarious position,” said Indermit Gill, the World Bank Group’s Chief Economist and Senior Vice President. “Outside of East and South Asia, it is a long way from the dynamism needed to eliminate poverty, counter climate change, and replenish human capital. In 2023, trade will grow at less than a third of its pace in the years before the pandemic. In emerging markets and developing economies, debt pressures are growing due to higher interest rates. Fiscal weaknesses have already tipped many low-income countries into debt distress. Meanwhile, the financing needs to achieve the sustainable development goals are far greater than even the most optimistic projections of private investment.”
“Many developing economies are struggling to cope with weak growth, persistently high inflation, and record debt levels. Yet new hazards—such as the possibility of more widespread spillovers from renewed financial stress in advanced economies—could make matters even worse for them,” said Ayhan Kose, Deputy Chief Economist of the World Bank Group. “Policy makers in these economies should act promptly to prevent financial contagion and reduce near-term domestic vulnerabilities.”
DG Okonjo-Iweala: E-commerce has emerged as major force in global economic output, trade (WTO)
The workshop provided an opportunity for WTO members to exchange views with international organisations on cross-cutting issues under the Work Programme identified by members in the past few months. In particular, the workshop looked at work carried out at the international level on consumer protection, the digital divide, the moratorium on imposing customs duties on electronic transmissions and legal, regulatory frameworks on e-commerce.
DG Okonjo-Iweala noted that members are engaging substantively on broad e-commerce-related issues with a development focus. “These discussions are important to better understand the challenges and opportunities of digital trade,” she said.
DG Okonjo-Iweala noted the dramatic growth in services delivered across borders via digital networks. The WTO estimates that global exports of digitally delivered services grew by 8.1% per year between 2005 and 2022, much higher than the 5.6% growth registered for goods exports.
The DG said: “In 2022, the value of exports of these services, which cover everything from streaming games to consulting services provided by video, reached USD 3.82 trillion — worth 12% of total goods and services trade, up from 8% a decade earlier. With the comparatively slow recovery of tourism and other services requiring cross-border movement of people, digitally delivered services have increased their footprint in global services trade. Last year represented 54% of total global services exports.”
Private sector shares views on trading goods in digital era, post-pandemic changes (WTO)
The event, moderated by Suja Rishikesh Mavroidis, Director of the Market Access Division, highlighted how the COVID-19 pandemic lockdowns compelled businesses and organisations to move many of their functions online and to accelerate their digital transformations. These included processes related to the movement of goods across borders and dealing with customs issues. Participants also looked at how this digital transformation has affected trade in goods and discussed whether trade has become as a result more efficient, safe and sustainable.
From a significant reliance upon paper and manual processes that slowed down trade during COVID-19, countries and companies transitioned to updated digital-based operating models to handle modern post-pandemic world trade. Further digitalizing process and incorporating modern technologies such as artificial intelligence (AI) machine learning will reduce risks in trade and will allow better targeting to reduce intentional and unintentional fraud. The reality is humans can no longer process the amount of data generated in international trade, said Mr John Bescec, Director of Customs and Trade Affairs at Microsoft and Chair of the Global Customs and Trade Facilitation Commission at the ICC.
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South Africa: African Continental Free Trade Area Awareness Workshop Goes to Gauteng (The Department of Trade, Industry, and Competition)
The Department of Trade, Industry, and Competition (the dtic) and the Gauteng Growth and Development Agency (GGDA) are pleased to announce the upcoming workshop on the implementation of the African Continental Free Trade Area (AfCFTA). The event is scheduled to take place at Constitutional Hill in Gauteng on Monday, 5 June 2023, as part of a nationwide series of workshops.
Following the successful inaugural workshop in KwaZulu-Natal last week, this workshop aims to engage with the private sector, Small and Medium Enterprises (SMEs), women-owned businesses, and youth-owned export ready businesses.
Angola to Accelerate Job Creation and Growth in Private Enterprise, with Focus on Lobito Corridor (World Bank)
Angola aims to accelerate economic diversification, private investment, and jobs by creating more favorable business conditions for micro, small and medium enterprises (MSMEs), with support from the World Bank. Approved this week by the World Bank Group Board of Directors, the $300 million Accelerating Economic Diversification and Job Creation Project will benefit an estimated 12,000 firms, creating direct and indirect jobs as a result of project activities, and help Angola transition from an oil-driven and state-led development model to a private sector-led model that is also inclusive and climate resilient.
The project aims to increase private investment and climate-resilient growth of MSMEs in non-oil value chains, particularly in the Lobito corridor which has the potential to play a central role in Angola’s economic diversification and transformation.
Govt in push to grow manufacturing, President Ruto announces (Capital News)
The government will focus on select value chains to grow manufacturing to create jobs, President William Ruto has said. The President said the identified value chains have significant untapped industrial potential and will create thousands of jobs. “We see leather, pyrethrum, cotton, textiles and apparel, pharmaceutical, edible oils as value chains whose industrialisation will hasten the attainment of our vision for national economic growth and transformation,” the President said.
ECOWAS is working with four areas to industrialize – Dr Ojoku (Ghana Business News)
To industrialize and strengthen intra-African trade, Economic Community for West African States (ECOWAS) is working around four thematic areas, Dr Kenji Ojoku, has announced. He said the 40-year plan, which began in 2010 to 2030 is also geared towards reducing importation of goods outside the sub-region.
Dr Ojoku who stated this in a two-day seventh Ghana International Trade and Finance conference (GITFiC) in Senchi in the Eastern Region on zoom said the plan if well executed could reduce import bills of member countries.
Speaking on Trade and healthy investment on the theme: “Actualising Africa’s Industrialization agenda in the era of AfCFTA: The role of Africa’s Small and Medium scale enterprises:The ECOWAS perspective, Dr Ojoku named the four areas as: Agro-Industry and Agro-business, Constructional Industry, Automotive Industry and ICT.
Reimagining economic growth in Africa: Turning diversity into opportunity (McKinsey & Company)
Africa is home to the world’s youngest and fastest-growing population, burgeoning cities, and bold innovations in everything from fintech to clean energy. With its population expected to nearly double to 2.5 billion people by 2050, the continent presents myriad opportunities for robust, inclusive growth that harness its rich natural resources and abundant human potential to increase prosperity not only in Africa but around the world.
Improving and increasing the productivity of all sectors must power Africa’s economic growth going forward. The continent is blessed with a young and vibrant population, rich natural resources, thriving cities, and emerging innovations, all assets that can be enlisted to enhance output and add value. Increasing digitization, developing talent, collaborating more regionally, supporting more business champions, and building green businesses are just some of the ways Africa can increase productivity.
The world needs a thriving Africa to make the transition to net zero, lessen the emerging impact of demographic decline, and give the continent its rightful place in global commerce and trade. Achieving sustainable growth from a foundation of strong productivity will increase African resilience and spread well-being and prosperity across the continent.
What Africa needs to achieve its digital economy potential (The Citizen)
Africa’s digital economy is expected to be worth $712 billion by 2050. However, for this to happen, the continent must invest more in digital infrastructure, business-friendly settings, education and youth motivation.
Currently, Africa’s Gross Domestic Product (GDP) is $3.1 trillion, with digital contributing approximately $200 billion, but stakeholders believe the continent has enormous potential to become the heart of the digital economy in the future years. Agritech, manufacturing, fintech, logistics, e-commerce, and automation through the use of artificial intelligence across all economic activities appear to be fuelling that rise.
During the inauguration of Africa’s largest tech and start-up exhibition (Gitex Africa), Moroccan Head of Government Aziz Akhannouch said Africa is a continent with a lot of young people, and its economy can be developed through the use of digital technology.
“Africa is a continent with the potential to be a leader in benefiting from the digital economy. We have a lot of talent and enough resources; what we need is to make sure our young people are well skilled, well incubated, and care about them, along with making good use of our natural resources,” said Mr Akhannouch.
He said infrastructure is the key to development, and in that case, the digital economy needs suitable infrastructure and the promotion of innovation, as well as a friendly business environment to attract more investors.
Can African countries collaborate on an e-car? (Quartz)
Africa’s key auto hubs, South Africa and Morocco, have hinted at mega and giga factories in their electric cars bid to remain relevant and tap a fast-rising global market. Mineral-rich countries like the Democratic Republic of Congo (DRC), Zambia, and Mozambique are also eyeing the market with big intentions of becoming major suppliers of electric vehicle batteries.
For these countries to competitively bid for a major stake in the global electric vehicle market, industry experts say they should form regional value chains to cut cross-border trade costs and barriers to investments.
Cliffe Dekker Hofmyer corporate and commercial practice director, Margo-Ann Werner says there is a full appreciation that Africa is a mineral-rich continent and that the e-mobility sector could rely on the various diverse types of minerals accessible within Africa. Establishing manufacturing nodes across the continent and leveraging on the AfCFTA, she said could result in a range of benefits including cost-effectiveness in the production of electric car batteries.
“So, it’s about establishing those sort of regional relationships between countries to achieve a collective benefit for all,” said Werner during the webinar on What we need to do to make e-mobility a reality in Africa.
Kenya commits to becoming Africa’s gateway to free trade (The Star)
Kenya has committed to becoming the preferred gateway to the African Continental Free Trade Area (AfCFTA). Speaking during the Kenya International Investment Conference on the prospects of unlocking the continent’s gateway, state department for Investment promotion PS Abubakar Hassan said the country is well positioned and focused on becoming more investor-centric.
“In terms of investor package, Kenya has an attractive package that is robust, youthful, affordable, well-educated, highly skilled and creative,” Hassan said. He added that last year, the country was ranked as the most innovative nation in the continent by the World Economic Forum, a remedy to a positive impact on business and society at large.
“We need local and regional supply chains hubbed by a country with diversified capabilities. In Africa, Kenya suits that bill. Kenya has the best logistic and infrastructure development support,” Equity Bank Group Managing Director and Group CEO James Mwangi said.
He added that Nairobi has an international diversity of communities making it a rainbow when it comes to doing business. Due to this diversified business landscape, he notes that Kenya serves as an excellent gateway to the African Continental Free Trade Area.
Involving civil society actors in the implementation of the AfCFTA in Burkina Faso (UNECA)
The United Nations Economic Commission for Africa (ECA) organized a national consultations workshop for civil society actors on the content of the African Continental Free Trade Area (AfCFTA) strategy, in Ouagadougou from May 31 to June 1. The objective of this meeting with civil society actors was to inform them on the key orientations of the National Strategy for the implementation of the Agreement in Burkina Faso, and in particular the flagship actions of the action plan.
In his speech at the opening ceremony of the workshop, Souleymane Ouédraogo, Director of Trade at the General Directorate of Commerce in Burkina Faso’s Ministry of Industrial Development, Trade, Handicrafts and Small and Medium-sized Enterprises, asserted that “Civil society players are in a way the citadel for giving advice, to ensure that public interventions in particular can meet the needs and expectations of consumers, of the population quite simply”.
“These actors are essential, and it’s really important that we involve them so that the implementation of the AfCFTA is inclusive, taking into account our reality and the diversity of our populations,” he said.
New payment platform for Africa (Advanced Television)
African pay-TV operator MultiChoice Group, payments platform specialist Rapyd and venture capital firm General Catalyst have unveiled a joint venture aimed at developing an integrated payment platform for Africa. The joint venture will operate under a new company, called Moment.
Moment will offer expanded payment infrastructure for businesses across Africa to help them collect and make payments easier, quicker, and more affordable in any manner that their buyers or suppliers prefer. The aim is to transform the African payments landscape by making digital payments more accessible and reliable for domestic, cross-border and global payments.
The long-term plan is to provide the infrastructure for pan-African payments for the 44 million small businesses operating on the continent. It is also to turn the 90 per cent of retail transactions that are currently taking place in cash, into digital payments. Moment aims to make digital transactions more accessible to the 350 million consumers that are underbanked or not banked at all.
Africa warned against ‘ditch the dollar’ calls (The Citizen)
African countries have been cautioned about a suggestion by President William Ruto of Kenya, urging them to ditch the US dollar. Analysts say that although the idea was good, it was hardly practicable given the current level of economic development on the continent.
“Before we jump on that train, we have to develop our economies,” said a business consultant. He said the suggestion by the Kenyan leader came at a time when African countries relied heavily on transacting business in the US currency.
Early this week, President Ruto asked the African leaders to take the first steps towards ditching the globally bullish US dollar. This, he said, can be done by signing up to a pan African payments system to facilitate trade within the continent; technically ditching the dollar. But Mr Kashamba said the suggestion will have to wait until African economies are freed from the grip of major economic giants like the US.
Mr John Bosco Kalisa, the executive secretary of the East African Business Council (EABC), emphatically said the suggestion was long overdue. “Our currencies (in Africa) have lost value because they are not supported by productivity,” he said when reached out for comment. However, he cautioned that before Africa begins a journey to a single currency, “we need to enhance our level of productivity and investments within our economies.”
The African Development Bank’s Gender Equality Trust Fund will provide a $950,000 grant to the Africa Small and Medium Enterprise Business Linkages Program in Burkina Faso, Chad, Mali, Mauritania, and Niger. The grant, which will supplement an earlier $3.9 million financing grant from the Bank’s Transition Support Facility, is expected to bolster 1,400 women-led enterprises and contribute to the region’s economic resilience and social cohesion.
“We are excited to extend the impact of the program that will reach more than a thousand women entrepreneurs across the Sahel region,” said Malado Kaba, the Bank’s Director for Gender, Women and Civil Society. “We believe one key to building resilient African societies is the inclusion of women in economic development. The program’s wide range of business-related training and coaching – in addition to increasing access to finance - will go a long way toward reaching that goal,” she added.
Experts call for strong approach to understanding blue economy (Tanzania Daily News)
A call has been made to have a strong scientific approach to understanding the Blue Economy so as to ensure long-term prosperity for all Tanzanians. The call was made over the weekend at the stakeholders’ workshop here in Dodoma ahead of the UN World Oceans Day this week.
Available statistics show that sectors related with Blue Economy contributed a total of 7.7 billion US dollars to Mainland Tanzania’s gross value added (GVA) in 2020.
The workshop was meant to discuss research results of the project “Socio-Economic and Ecological Assessment of the Blue Economy in Tanzania 2022: Application of UNECA’S Blue Economy Valuation Toolkit”.
World Environment Day brings solutions to plastic pollution into focus (UN Environment)
Individuals, communities, civil society, businesses and governments around the world today marked World Environment Day with a focus on solutions to plastic pollution, with official celebrations held in Abidjan, Côte d’Ivoire, with the support of the Netherlands. The focus on solutions to plastic pollution this World Environment Day is particularly timely, following the recent conclusion of a second round of negotiations on a global agreement to end plastic pollution in France.
“Plastic is made from fossil fuels – the more plastic we produce, the more fossil fuel we burn, and the worse we make the climate crisis. But we have solutions,” UN Secretary-General António Guterres said in his World Environment Day message. “We must work as one – governments, companies, and consumers alike – to break our addiction to plastics, champion zero waste, and build a truly circular economy.”
Humanity produces over 430 million tonnes of plastic annually, two-thirds of which are short-lived products that soon become waste. While the social and economic costs of plastic pollution range between $US300 to US$600 billion per year.
According to a recent UNEP report, Turning off the Tap, plastic pollution could reduce by 80 percent by 2040 if countries and companies make deep policy and market shifts using existing technologies.
The Southern African Development Community (SADC) joins in the commemoration of this year’s International Day for the Fight against Illegal, Unreported and Unregulated (IUU) Fishing which falls on 5 June 2023, with a call for urgent actions to address IUU fishing in the SADC region to be taken/implemented. This includes better monitoring and control measures, such as tracking vessels, implementing stronger regulations, and increasing collaboration between governments and other stakeholders.
FAO Food Price Index declines in May (FAO)
The benchmark index of international food commodity prices declined in May amid significant drops in quotations for most cereals, vegetable oils and dairy products, the Food and Agriculture Organization of the United Nations (FAO) reported.
The FAO Food Price Index, which tracks monthly changes in the international prices of commonly-traded food commodities, averaged 124.3 points in May, down 2.6 percent from April and as much as 22.1 percent below the all-time high reached in March 2022.
World trade in cereals in the 2023/24 marketing season is forecast at 472 million tonnes, near the 2022/23 level, as increased traded volumes of coarse grains and rice (January-December 2024 trade for rice) are foreseen to offset an expected decline in global wheat trade.
At a time when food systems in Eastern and Southern Africa continue to be battered by multiple shocks, the World Bank is expanding its support for food security and food systems resilience to benefit an additional 2.8 million people. The World Bank Group’s Board of Executive Directors approved $903 million in International Development Association (IDA) financing for Comoros ($40 million), Kenya ($150 million), Malawi ($250 million), Somalia ($150 million), Tanzania ($300 million) and the African Union Commission ($13 million) as part of the second and third phases of the Food Systems Resilience Program (FSRP) for Eastern and Southern Africa.
“The addition of five countries responds to the ongoing demand for long-term solutions offered by the Food Systems Resilience Program. Studies demonstrate that proactive investments in building resilience not only pay off but also minimize the costs of disaster relief and recovery. As more countries are expected to join, we’re grateful that our board has agreed to increase the overall envelope for the entire FSRP program from $2.3 billion to $2.75 billion,” said Victoria Kwakwa, World Bank Vice President for Eastern and Southern Africa.
How Africa’s food systems forum 2023 will unleash economic opportunities, investment potential (Tanzania Daily News)
Tanzania is set to host the highly anticipated Africa’s Food Systems Forum 2023 Summit in Dar es Salaam this September. This prestigious event will not only position Tanzania as a hub for agricultural innovation and sustainable food systems but it will also unleash significant economic opportunities and attract valuable investments.
The Africa’s Food Systems Forum 2023 Summit will emphasise the importance of value addition and agro-processing in promoting sustainable food systems. Tanzania, with its vast agricultural resources, can leverage this opportunity to develop and expand its agro-processing industries.
Value addition initiatives, such as food processing, packaging, and preservation, will not only enhance the value of agricultural produce but also create a robust agribusiness ecosystem and contribute to export diversification.
The Africa’s Food Systems Forum 2023 Summit will highlight the role of technology and innovation in transforming agriculture and promoting sustainable food systems. Tanzania, with its growing digital landscape and emerging technology startups, can seize this opportunity to showcase its innovative solutions in precision agriculture, farm management systems, market linkage platforms, and data-driven decision-making. This will not only attract investments in agri-tech but also accelerate the adoption of modern practices and improve productivity in the sector.
Africa has the necessary partnerships and technologies to eradicate hunger, said African Development Bank President Dr. Akinwumi A. Adesina.
What is needed is action including robust financing, Adesina said Monday during the opening session of the 8th Africa Agribusiness and Science Week (AASW) in Durban, South Africa. “We must pull together the best of science, technology, and innovations to drive a more productive, efficient, and more competitive agricultural system,” Adesina told an audience of stakeholders in agriculture and agribusiness research and innovation in Africa.
Africa needs to leverage its potential, including science, and be proactive rather than reactive to shocks, she said. She urged the continent to take advantage of its youthful population and immense natural capital. “Let us unlock the potential we have… We should feed Africans and we should feed the world,” AUC Commissioner for Rural Economy and Agriculture Ambassador Josefa Leonel Correia Sacko said.
Adesina said African food systems have the potential to unleash $1 trillion in value over the next seven years.
Agricultural Market Information System: detail (AMIS)
While agricultural prices have declined over the past 12 months, food price inflation remains high. FAO's food price index, a measure of the monthly change in international prices of a basket of food commodities, is down 20 percent from year-ago levels. Yet, double-digit food inflation rates are reported in many countries around the world. Food inflation remains elevated in part because of the strong US dollar, which has kept commodity prices high in local currencies, and because post-farmgate costs such as energy, transportation, and food manufacturing costs, which account for a large share of the retail price, remain high due to core inflationary pressures. The poor suffer the most from high food prices as they spend high shares of their incomes on food and have weak capacity to cope with price shocks.
Trade relations between the US and Africa have centred on Congress’s ‘Africa Growth and Opportunities Act’ (AGOA) since 2000, designed to foster the continent’s economic development and prosperity via preferential access to American markets. Yet in the last decade African trade with the United States has stagnated at much the same levels as it was when the Act was passed.
Though no public announcement has yet been issued, and policy could change, US trade policymakers hinted at a US-Africa summit in December 2022 that AGOA will be renewed before it expires in 2025.
A more discerning critic, able to overlook the fact that most of the fall in US-Africa trade is from the displacement of African oil imports with US shale oil since 2011, might still critique the capacity of AGOA to ‘diversify sources of growth in sub-Saharan Africa’. ‘Economic diversification’ is one of the priority areas of the African Union Agenda 2063 and is perceived by many African countries to be critical to their sustainable development. Non-mineral fuel exports from Africa to the US have grown since 2001 but, at around $10 billion annually, are only about equivalent to annual US aid-for-trade disbursements to the continent.
New UN reports aim to avert continued social, economic and environmental ‘breakdown’ (UN News)
Reforming the global financial system, moving beyond Gross Domestic Product (GDP) as a measure of economic progress, and addressing technology challenges are crucial to achieving a more just and equitable future for all, UN Secretary-General António Guterres said on Monday.
He was speaking at UN Headquarters in New York, where he presented three new policy briefs on these themes to Member States.
“They touch on some of the most serious challenges we face – challenges that may determine whether we are able to achieve the vision of the 2030 Agenda and the Sustainable Development Goals, or whether we continue towards a future of continued social, financial, political and environmental breakdown,” he said.
The briefs are intended to inform discussions ahead of the crunch SDG Summit in September, marking the midpoint towards achieving the Goals, and the related Summit of the Future next year.
Commonwealth Trade Ministers Meet to Foster Cooperation for Resilient, Inclusive, Green and Digital Economies (The Commonwealth)
The 2023 Commonwealth Trade Ministers Meeting (CTMM) opened today at Marlborough House in London. The meeting, being held on the 5th and 6th of June, brings together trade ministers from across the Commonwealth to discuss and deliberate on key issues related to trade and investment.
The theme for this year’s CTMM is ‘Delivering a Common Future: Cooperation for Resilient, Inclusive, Green and Digital Economies.’
In her opening speech, Commonwealth Secretary-General Rt Hon Patricia Scotland KC welcomed the Trade Ministers and highlighted the significance of their gathering. “We are here because we share a common vision: to achieve US$2 trillion in intra-Commonwealth trade by 2030. We gather in a time of change and challenge. All of us are tightly bound by a tangled knot of crises spanning global systems: A world living with the social, political and economic consequences of COVID-19, crippling debt, rising inflation and high interest rates, spiralling costs for food and energy, tremors of instability and conflict and the increasingly harsh impacts of climate change. In isolation, each of these challenges is grave and serious, but they interconnect, entwine, and worsen one another, threatening our collective well-being.”
India: BRICS Now An Established Part Of Global Geopolitics & Trade (Silk Road Briefing)
The BRICS group of nations is no longer an alternative to other international associations, but a bulwark of global politics, External Affairs Minister of India Subrahmanyam Jaishankar stated on Friday (June 2).
“BRICS is no longer an ‘alternative,’ it is an established feature of the global landscape. The message of reform that BRICS embodies must permeate the world of multilateralism,” Jaishanker said, adding that “The Friends of BRICS strongly support UNSC reform. BRICS is not only an expression of multipolarity but of the many and diverse ways of meeting international challenges.”
The BRICS group of nations seeks to build “a fairer, inclusive and open international architecture with sustainable development at its core,” he stated. “Creating resilient and reliable supply chains are central to ensuring that no one is left behind,” the foreign minister stressed.
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Eswatini Air flights boost tourism, trade ties with SA (CAJ News Africa)
THE resumption of flights by Eswatini Air to South Africa is anticipated to boost trade between the two countries. The direct flight to Durban was opened early in May, with a maximum capacity of 50 passengers operated by an Embraer ERJ 145 aircraft. It operates flights on Mondays, Thursdays, and Saturdays. There are plans to increase frequencies to seven times a week from this month, based on demand.
“Eswatini is one of the key regional tourism markets and shares strong historical and cultural ties with the province of KwaZulu-Natal,” Member of Executive Committee (MEC) for Economic Development, Tourism and Environmental Affairs, Siboniso Duma, said.
Pre-pandemic, tourist arrivals from Eswatini averaged 290 000 per annum and in 2022 tourist arrivals demonstrated a strong recovery of 89 percent. “This presents an exciting opportunity for Eswatini Air to grow as a partner in accelerating the recovery of tourism between the two destinations,” Duma said.
Rwanda steps up policy efforts to spur e-commerce growth (UNCTAD)
As a landlocked economy undergoing massive transformation, Rwanda is increasingly gaining international attention for its forward-looking digital policies. Such policies, in part, aim at boosting the country’s emerging digital economy through a coordinated “whole-of-government” approach, and could be strengthened by a national e-commerce strategy as outlined in a report recently published by UNCTAD.
“E-commerce growth is a unique opportunity to open access to international and local markets for our small and medium-sized enterprises. It can help strengthen the private sector’s contribution to national growth,” says Jean Chrysostome Ngabitsinze, Rwanda’s minister of trade and industry, in the report’s foreword.
The UNCTAD report outlines a five-year strategic plan to foster an enabling e-commerce environment in Rwanda, with detailed frameworks for governance, implementation, monitoring and evaluation.
Another key aspect of the strategy is enabling more Rwandan women – particularly those living in rural areas – to benefit from the digital economy.
This would require reducing telecommunication costs, while making it more affordable for women to use and own devices such as smartphones and computers to ease e-commerce.
Other initiatives featured in the report aim to improve women’s digital skills and knowledge, as well as access to financial services to help grow their businesses.
Single digital market crucial for Africa to navigate economic challenges: GITEX Africa 2023 (Ahram Online)
The inaugural event of GITEX AFRICA 2023, which concludes on Friday, is being held in Marrakech, Morocco. It is the biggest event on the continent gathering investors, startups and innovators seeking to advance digital transformation in Africa and showcasing the newest in all tech-based solutions.
Omar Sultan Al Olama, the UAE’s minister of state for artificial intelligence, said that the global tech market is expected to jump to $712 billion by 2030, up from $115 billion. This increase provides a golden chance for Africa with its large young population to accelerate the process of digital transformation for the benefit of the continent’s economies and people.
“Private sector and governments have to work hand in hand to push forward the digital transition process, and to support the small and medium-sized enterprises in this regard,” Trixie Lohmirman, the CEO of GITEX Africa organiser UAE-based KAOUN, said.
Africa Month: African youths optimistic over AfCFTA – Report (Vanguard)
The Ichikowitz Family Foundation’s African Youth Survey reports have revealed that 46 per cent of young Africans had limited knowledge of the African Continental Free Trade Area, AfCFTA, which was brokered by the African Union, AU, in 2018.
The foundation, which conducted an expansive study of Africans between the ages of 18 and 24, also disclosed that among those who were aware of AfCFTA, the majority (55 per cent) of respondents said the free trade area would have a positive impact on their country.
According to the foundation, a little more than one-in-five young Africans (22 per cent) indicated that they were familiar with AfCFTA, one-in-five were skeptical about AfCFTA making a difference in their country’s economic situation, while 15 per cent noted that it would worsen the situation.
AfCFTA: African ministers adopt ban on trade of second-hand clothes (The New Times)
African ministers, on June 1, adopted the protocol that prevents trading second-hand clothes across the continent under the preferences of the African Continental Free Trade Area (AfCFTA).
The decision was taken during the second Ministerial Retreat of the Council of Ministers on the AfCFTA, held in Nairobi, Kenya, to assess the progress and address critical aspects of the agreement’s implementation.
Held under the theme “The Role of the Private Sector in the Implementation of the AfCFTA: Own and Drive AfCFTA,” they discussed the outstanding Rules of Origin on Auto, Textiles and Clothing, estimated tariff revenue losses and the adjustment facility allocations, as well as proposals on front-loading liberalisation of trade in basic agricultural products.
Manufacturing industry a catalyst for economic growth – Adeyemi (Businessday)
The manufacturing industry serves as a catalyst for economic growth, job creation, and technological advancement; it adds value to the economy and fosters innovation and productivity, according to Tumi Adeyemi, founder and CEO, ZenoLynk Technologies Limited.
This was disclosed recently at the third Equipment and Manufacturing West Africa (EMWA) Expo in Lagos themed, ‘Reigniting Manufacturing to Drive Growth and Development’.
In his address, Adeyemi noted that although Nigeria’s manufacturing sector is faced with obstacles such as inadequate infrastructure, unreliable power supply, bureaucratic bottlenecks, etc, it possesses immense potential for growth and development.
According to him, “By capitalising on this vast market of 1.3 billion people and eliminating trade barriers, Nigerian manufacturers can expand their reach, tap into new markets, and bolster export-oriented production. This agreement calls for strategic planning, increased competitiveness, and product diversification to position our manufacturing sector as a regional powerhouse.”
Africa must work together to guarantee food, economic security – Akufo-Addo (Ghana Business News)
President Nana Addo Dankwa Akufo-Addo has called on African leaders to foster intra-trade partnerships to ensure sustainable economic growth for the continent. He said it was imperative that the countries took advantage of the African Continental Free Trade Area (AfCFTA) Agreement to guarantee food and economic security. The President made the call when he addressed the opening of the Seventh African Leadership Forum (ALF) in Accra on Thursday.
Ghana is hosting this year’s ALF on the theme: “Promoting Intra-Africa Trade to Unlock Agricultural Potential in Africa.” It aims to highlight the continent’s agricultural potentials and opportunities emerging from climate change, discuss the obstacles, as well as practical and realistic requirements for implementing the AfCFTA. The agenda is to identify priorities and a roadmap for implementing the agricultural trade perspective under the Agreement to realise its transformative economic objective.
The President said the time had come for the continent to define its own narratives in respect of producing enough to feed its people. This was achievable given the continent’s vast arable land and natural resources, he noted.
Establishing food security, the President noted, was important for millions of people facing hunger in Africa, and crucial for sustainable economic development and the long-term prosperity of the continent.
The African Union has concluded a three-day meeting of the Specialized Technical Committee on Finance, Monetary Affairs, Economic Planning and Integration- Sub-Committee on Tax and Illicit Financial Flows under the theme “Tax in Africa: contemporary issues affecting the continent” and adopted recommendations that ensure African interests are protected in the design and implementation of the global tax rules, and ways to improve domestic resource mobilization for Africa’s development.
The meeting discussed parameters of the African position on the Promotion of inclusive and effective tax cooperation at the United Nations and on the consideration of the enactment of a Domestic Minimum Top-up tax for tax base protection ahead of the incoming global tax rules; adopted recommendations to use the VAT toolkit by ATAF for improved revenue collection on cross-border supplies; and identified areas where future legislative action or coordination would benefit Member States, the African Union and relevant partners, in regard to addressing the issue of wasteful tax incentives, stemming of Illicit Financial Flows respectively, and improving continental domestic resource mobilization necessary for the development of the continent.
Amb. Albert Muchanga, African Union Commissioner for Economic development, Trade, Tourism, Industry and Minerals, noted that to effectively operationalize the UN Convention on International Tax Cooperation, the process must be inclusive in incorporating the views of existing African structures and leverage the work of the UN Committee of Experts on International Tax Cooperation. Further, the Member State-led intergovernmental body ought to have a well-resourced technical structure to focus on specific pain points in developing countries not addressed by previous initiatives to address gaps in tax cooperation. “At the continent level, the core issue is how Africa can develop tax administrations to increase investments from the current level of 20% of GDP to 40%. By incorporating the views of existing African structures, the operationalization process of the Convention will ensure accountability and full ownership by the Member States.”
Regional bodies meet in Madagascar to discuss domestic financing (Africa Science News)
The African Union (AU) Commission, in collaboration with the East African Community (EAC), the Economic Community of Central African States (ECCAS) and the Intergovernmental Authority on Development (IGAD) Member States, is convening experts on Neglected Tropical Diseases (NTDs) programming for a regional meeting to discuss mobilising domestic resources and strengthening programs to combat NTDs in the Eastern and Central African regions from 31 May to 02 June in Antananarivo, Madagascar.
NTDs regularly occur within an area or community (endemic) in 49 AU Member States. They affect more than 600 million people, accounting for about 42% of the global burden of NTDs. Socioeconomic factors such as poverty, heightened exposure to vectors, unsafe food and water, reservoir hosts and climate and other poor living conditions exacerbate the spread of NTDs. In some regions of the African continent, socio-political conflicts and internal civil unrest continue to aggravate the spread of NTDs and hamper effective interventions to control and /or eliminate these diseases.
The leaders called for the containment and reversal of other major infectious diseases as part of the continental agenda to promote poverty reduction, sustainable development and political security. The Abuja call is reinforced by the AU Agenda 2063: “The Africa We Want”, which envisions healthy and well-nourished African citizens free of all diseases, including NTDs.
“The African Union (AU) Commission is committed to attaining Aspiration One, Goal three of Agenda 2063, of well-nourished and healthy citizens. The AU Continental Framework and Common African Position on NTDs recommend strong strategies to eliminate Neglected Tropical Diseases (NTDs) in Africa. Our collective task moving forward is a mandate to increase investment, action and collaboration towards successfully implementing the recommendations. We are committed to collaborating with partners to progress the elimination of NTDs on the African Continent,”- Prof. Julio Rakotonirina, Director of Health and Humanitarian Affairs, Department of Health, Humanitarian Affairs and Social Development African Union Commission
EAC Secretariat given greenlight to commence negotiations with Somalia (The New Times)
Regional leaders on Wednesday, May 31, directed the East African Community Secretariat and the Council of Ministers to “with immediate effect” commence negotiations with Somalia as regards the latter’s request to join the seven-member bloc.
That was after the Heads of State deliberated on and adopted the report of the verification of the application of Somalia to join the EAC – earlier circulated to the partner states – during their 21st Extraordinary EAC Heads of State Summit.
Somalia’s Presidential Special Envoy to the EAC, Abdusalam Omer, on Thursday, June 1, told The New Times that “This is a major milestone for Somalia’s accession to the EAC and the acceptance of its application. It is a testament that Somalia has met the necessary requirements to join the EAC. I am sure the negotiations will be successful.”
EABC: EAC taxmen should facilitate trade not only tax (Tanzania Daily News)
THE East African Business Council (EABC) has advised the East African revenue authorities to focus on trade facilitation and not only to dwell on tax issues. The EABC Executive Director, Mr John-Bosco Kalisa, said on Tuesday that the governments should provide incentives and measures to build businesses better and more resilient amid global crises.
“Revenue authorities should focus on trade facilitation,” Mr Kalisa said during the senior executives’ tax seminar aiming at gaining valuable insights from tax experts and experiences in East Africa. “The EAC partner states should harmonise their monetary and fiscal policies to remove tax distortions.”
Last July, EAC partner states started applying a 4-band EAC Common External Tariff Structure of 0 per cent, 10 per cent, 25 per cent, and 35 per cent. The new tariff structure maintained the sensitive items that attract tariff rates of 50 per cent to 100 per cent.
UNCTAD tool improves service trade data in West Africa (UNCTAD)
Statistics on trade in services are crucial to supporting negotiations and monitoring the impact of relevant trade agreements. But getting comprehensive, high-quality statistics in this area remains a challenge for many developing countries.
UNCTAD’s trade in services statistics (TiSSTAT) information system developed at the request of the West African Economic and Monetary Union, known by its French acronym UEMOA, is helping countries in the region to tackle this issue.
Trade in services is conceptually difficult to measure, as it takes varying forms from transport and construction to business services. By their very nature, such services are often produced and consumed at the same time, and their trade is not captured by customs systems.
The TiSSTAT software developed under an UNCTAD-UEMOA project helps strengthen and streamline the collection and processing of statistics on international trade in services.
West African states urged to make a start on ‘daunting’ $15bn highway (Global Construction Review)
The governments of five West African states held more talks last month about a long-discussed $15bn highway connecting Nigeria and Côte d’Ivoire, taking in Benin, Togo, and Ghana along the Gulf of Guinea coast.
The 1,028 km road would form the spine of the Abidjan-Lagos Corridor, a major economic development project.
Ghanaian vice president Mahamudu Bawumia said the prompt execution of the project was critical for the economic development of the region, particularly in the wake of the implementation of the Africa Continent Free Trade Area.
He said most of the preparatory work, such as feasibility and preliminary design studies, had been completed, and that the time had come for the five countries to be “more committed to the commencement of this daunting project”.
West African sub-regional actors mobilize for sustainable development of the sub-region (UNECA)
The United Nations Economic Commission for Africa (UNECA), through its Sub-Regional Office for West Africa, in partnership with the Senegalese Ministry of the Economy, Planning and Cooperation, the Economic Community of West African States (ECOWAS), the Comité Inter Etats de Lutte contre la Sécheresse dans le Sahel (CILSS) and the World Food Programme (WFP), is organizing in Dakar a Regional meeting of Intergovernmental Organizations in West Africa: “Promoting Regional Value chains and food security for strengthening regional integration and sustainable development in West Africa”.
The specific objectives of the meeting are: Review the progress on the regional integration, Review and discuss the findings of the ECA’s study on the Opportunities for Regional Value Chains in West Africa within the framework of the African Continental Free Trade Area (AfCFTA) Assess the recent subregional macro-economic and food security trends;
EU spends £32 million to boost energy in Nigeria, Ghana, Togo, Mali others (The Guardian Nigeria)
The European Union is expending the sum of £32 million euros as part of ongoing effort to boost the energy sector in Nigeria and neighbouring West African countries. The AGoSE-AO program which seeks to Improve governance of the energy sector in West Africa was commissioned through the 11th European Development Funds is to be implemented between May 2022 to April 2024.
Officials of the Economic Community of West African States (ECOWAS) in conjunction with the European Union (EU) and other development partners held talks in Abuja yesterday aimed at boosting the energy sector in Nigeria and other countries in the west African sub-region.
Mr Bayaornibe Dabire, Directeur of Energy and Mines of ECOWAS and chairman of the meeting urges all stakeholders within the energy sector to continue to work together and to forge a path towards enhanced governance, transparency, and accountability in the energy sector, hence paving the way for sustainable development and alleviating poverty in West Africa.
Gender, Poverty and Environmental Indicators on African Countries 2023 (AfDB)
This volume is divided into three main parts. Part I highlights the progress being made by African countries towards the 17 Sustainable Development Goals (SDGs). Part II presents comparative cross-country data on gender (section 1), poverty (section 2), and the environment (section 3). Part III provides more detailed data on each of these three themes across each of the 54 African countries.
BRICS Ministers reflect on Russia-Ukraine war, Sudan conflict (SAnews)
“The Ministers recalled their national positions concerning the situation in and around Ukraine, as expressed at the appropriate fora, including the UNSC [United Nations Security Council] and UNGA [United Nations General Assembly],” a joint statement from the Ministers on Thursday read. “They reiterated their commitment to enhancing and improving global governance by promoting a more agile, effective, efficient, representative and accountable international and multilateral system,” the statement said.
BRICS pitches for using local currencies in international trade (Devdiscourse)
The BRICS nations on Friday underlined the need for using local currencies in international trade and financial transactions besides committing themselves to supporting rule-based open and transparent global trade. A joint statement issued at the end of the meeting of the BRICS Ministers of Foreign Affairs and International Relations, also pressed for a robust Global Financial Safety Net with a quota-based and adequately resourced International Monetary Fund (IMF) at its centre.
The joint statement titled ‘The Cape of Good Hope’, said ministers expressed their support for a free, open, transparent, inclusive, equitable, non-discriminatory and rules-based multilateral trading system with the World Trade Organization (WTO) at its core, with special and differential treatment (S&DT) for developing countries, including Least Developed Countries.
‘‘They stressed their support to work towards positive and meaningful outcomes on the issues at the 13th Ministerial Conference (MC13). They committed to engage constructively to pursue the necessary WTO reform with a view to presenting concrete deliverables to MC13. They called for the restoration of a fully and well-functioning dispute settlement system accessible to all members by 2024, and the selection of new Appellate Body Members without further delay,’’ it said.
WTO flags poor utilisation of India scheme for least developed countries (Business Standard)
About 85 per cent of about 11,000 products offered at zero tariff by India to least developed countries (LDCs) under the duty-free quota free (DFQF) scheme of the World Trade Organisation (WTO) remains unutilised, according to a report by the LDC Group at the multilateral trade body.
The decision to provide duty free quota free (DFQF) access for LDCs was first taken at the WTO Hong Kong Ministerial Meeting in 2005. The decision requires all developed and developing country members declaring themselves in a position to do so, to provide preferential market access for all products originating from all LDCs.
“There is a significant variation between the beneficiary LDCs, and the two countries (Guinea and Bangladesh) showing the highest amount of eligible imports simultaneously have very low utilisation rates (8 per cent for Guinea and 0 per cent in the case of Bangladesh). Benin on the other hand, reports a utilisation rate of 98 per cent, which is the highest of all beneficiary countries,” the report pointed out.
Beyond Trade and GDP: Exploring the Wealth of the Commonwealth (The Commonwealth)
Together, the 56 Commonwealth countries possess approximately US$150 trillion of wealth. This is 10 times greater than the value of their combined GDP (US$14.5 trillion) and 30 times more significant than the value of their global exports of goods and services ($4.8 trillion).
Three key components of this multidimensional measure of the wealth are physical capital (such as infrastructure and buildings), human capital (such as education and skills of the workforce), natural resources (both renewables and non-renewables).
Commonwealth countries’ wealth has grown by more than 108 percent between 1995 and 2018, surpassing the growth in global wealth (90 percent) in the same period. It has raised per capita wealth in the Commonwealth from US$42,700 to $59,800 despite the rapid rise in population from 1.7 billion to 2.5 billion. The primary driver of this increase has been the expansion of human resources and produced capital stocks, which saw an extraordinary increase, particularly in Asia and Africa
The ongoing restructuring of regional and global value chains offers numerous opportunities for Commonwealth members to leverage their abundant natural wealth to promote sustainable production and trade. Commonwealth countries possess abundant natural resources and renewable assets. With the growing focus on environmental concerns, Commonwealth countries are well-positioned to provide a wide range of environmental goods and services.
Commonwealth countries also hold a substantial stock of critical minerals required for the clean energy transition and digitalisation. This creates numerous opportunities to attract investment in emerging sectors, such as climate adaptation and digital technologies. Countries can facilitate investment in these emerging sectors by streamlining their regulatory environment.
DG Okonjo-Iweala: Trade key to ensuring food security in a time of crisis (WTO)
The jump in food and energy prices triggered by the war “has brought a complete new spotlight” on the issue of food security, the Director-General told participants. “Many of our developing country members, particularly the least developed countries, are on the receiving end of the crises that are happening in the world. This is something they did not cause but they are the ones who are suffering the most from the lack of access to food, from the lack of access to fertilizer, and from high prices resulting from the exchange rate movements and depreciation of currencies.”
With one in five calories traded internationally, “imagine how important the role of trade is now in order to help us solve this problem of access, of building resilience and of managing the volatility of food prices and energy prices,” she said. So “the first and best thing is keeping an open, predictable and stable international multilateral trading system. Trade has been absolutely central on the food front, and keeping a predictable, stable and fair system is key.”
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African Continental Free Trade Area Awareness Workshop Goes to Limpopo (The Department of Trade, Industry and Competition)
The Limpopo private sector will be exposed to export opportunities that are presented by the African Continental Free Trade Area (AfCFTA). This will happen during the Limpopo leg of the awareness workshop on the implementation of the African Continental Free Trade Area (AfCFTA) Agreement.
This is part of a series of workshops that the department is rolling out throughout the country from May-July 2023. The inaugural workshop took place in KwaZulu-Natal last week and was a success. Businesspeople who attended the KZN session welcomed the progress and benefits that the AfCFTA will afford their respective businesses once implemented.
According to the Chief Director of Africa Multilateral Economic Relations at the dtic, Mr Sandile Tyini, the workshop seeks to communicate and engage with the private sector, Small and Medium Enterprises (SMEs), as well as women and youth-owned export ready businesses on the status of the implementation of the AfCFTA, including opportunities for South African companies to participate in preferential trade beyond the Southern African region.
“The six sector master plans targeted for these workshops are steel and metal fabrication; agriculture and agro-processing; retail-clothing, textiles, footwear and leather (R-CTFL) value chain; automotive industry; sugar value chain; and forestry. Limpopo workshop will focus on agriculture and agro-processing; sugar value chain; forestry; as well as retail-clothing, textiles, footwear and leather (R-CTFL) value chain,” adds Tyini.
Mozambique to Submit Its Tariff Offer to AfCFTA By June (AIM)
Mozambique must submit its tariff offer to the African Continental Free Trade Area Secretariat (AfCFTA) by June of the current year. The tariff offer was ratified in 2022 by the Mozambican parliament, the Assembly of the Republic.
According to the Minister of Industry and Trade, Silvino Moreno, who was addressing the press during the launch of Africa Week Celebrations, the tariff offer is compulsory for Mozambique’s effective adherence to the continental free market.
“This document contains relevant information about the products that Mozambique will place in the continental market and those that will be free from customs tariffs. The work is concluded and we will present our tariff offer to the AfCFTA by June 30’, the minister said.
“We have a major agricultural capacity. We can offer cashew nuts, cotton and other products that are currently exported to Europe and Asia’, he said, adding that the country has a lengthy coastline, ideal for offering logistical services to some countries that do not have access to the sea.
After the tariff offer submission, he explained, there will follow the disclosure of the national private sector commitments, since Mozambican companies are the main actors of the market.
AfCFTA reviews opportunities in four products (Tanzania Daily News)
THE African Continental Free Trade Area (AfCFTA) is currently reviewing the existing opportunities in value chains of cotton, meat, coffee and cereals across the continent to understand how they contribute to intra-African trade. The four products are main cash streams in Tanzania.
AfCFTA SG said that the organisation is undertaking a review of the opportunities in those value chains of the four crops to help the member states to understand the full potentials of the produce in contributing to intra-African trade and the broader AfCFTA objectives.
“This is part of our collective efforts to create a policy environment for boosting regional investment in agricultural value chains for enhanced intra African trade in agricultural commodities and services and creating a new business dynamic in the agriculture trade arena,” the Secretary- General stressed.
According to the Food and Agriculture Organisation (2019), sub-Saharan Africa’s food import bill was 48.7 billion US dollars in 2019 compared to 46.9 billion US dollars in 2018.
The food import bill for the whole of Africa was about 80 billion US dollars per year in 2015–2017. From 2020 to 2022, the bill per year increased to 84 billion US dollars while intra Africa trade in agricultural food products was 11.4 billion US dollars, representing only 14 per cent of value of agricultural food products imported by Africa from other parts of the world.
“There is, therefore, an imperative need to accelerate agricultural production to reduce the food import bills, revive the rural economies, slow down rural to urban migration, expand foreign exchange earnings and create jobs, especially for young Africans and women,” he said.
USTR Releases Summaries from U.S.-Kenya Strategic Trade and Investment Partnership Negotiations (United States Trade Representative)
Consistent with the Biden-Harris Administration’s commitment to the highest levels of transparency in trade agreement negotiations, the Office of the United States Trade Representative (USTR) today released summaries of texts proposed by the U.S. side during the first negotiating round of the United States-Kenya Strategic Trade and Investment Partnership (STIP), which was held in Nairobi, Kenya from April 17-20, 2023.
The goal of the Partnership is to increase investment; promote sustainable and inclusive economic growth; benefit workers, consumers, and businesses (including micro-, small-, and medium-sized enterprises); and support African regional economic integration. The summaries detail the negotiating proposals from the U.S. side for the following chapters: agriculture; anticorruption; micro, small, and medium-sized enterprises; and services domestic regulation.
Buhari: Border Closure Aimed at Stimulating Local Consumption (This Day Live)
President Muhammadu Buhari, yesterday insisted that his 2019 closure of the country’s land borders was due to his administration’s conscious efforts to encourage Nigerians to eat what they produce locally, particularly the rice commodity.
Speaking while inaugurating the new Administrative Headquarters of the Nigeria Customs Service (NCS), in Maitama, Abuja, he claimed the border closure was consequently appreciated by Nigerians – apparently due to the revolution in local rice production which was occasioned by the positive impact of the Central Bank of Nigeria’s (CBN) Anchor Borrowers’ Programme (ABP) which provides unprecedented financing to smallholder farmers.
Buhari said he closed the borders deliberately to check rice smuggling from neighbouring countries – a situation which grossly undermined Nigeria’s food security agenda and put the economy at risk.
Morocco trade deficit widens by 2.6% year on year (ZAWYA)
Morocco’s trade deficit widened by 2.6% to 91.3 billion dirhams ($9.13 billion) in the first four months of this year despite a fall in some commodity prices, data from the foreign exchange regulator showed. Imports rose by 3.2% from the prior-year figure to 237 billion dirhams, despite a fall in some commodity prices that lowered the energy bill by 1.7% to 43 billion dirhams, according to the data. Exports meanwhile increased by 3.6% to 145.7 billion dirhams, the regulator said in its monthly report, led by the automotive sector where growing demand drove a 40% increase to 45 billion dirhams of exports.
African trade and integration
Ecobank Launches Single Market Trade Hub (Africa Global Funds)
Ecobank Group has unveiled its Ecobank Single Market Trade Hub with over 300 businesses from 22 countries having signed onto the digital platform so far. The Trade Hub connects traders across Africa, within the 1.4 billion people single market framework of the African Continental Free Trade Area (AfCFTA). The Ecobank Single Market Trade Hub is a digital platform, which serves as an exchange and information repository, designed to respond to the evolving trading needs of SMEs and corporates within Africa’s single market.
The Trade Hub reduces the asymmetry in trade information and in this connection, leverages Ecobank’s wide client base and network advantage, through its presence in 35 African markets.
Jeremy Awori, CEO, Ecobank Group, said: “AfCFTA has created an immense opportunity for African businesses. As the pan-African bank with the most extensive coverage of Africa, Ecobank is perfectly placed to provide trade, information and payment solutions to support SMEs and corporates seeking to capitalize on the single market.”
AfCFTA ‘will fail to reach its potential’ unless governments act (Supply Management)
Lobby group the African Business Council (AfBC) has called for the continent’s governments to ensure that 40% of public-sector contracts go to African companies rather than overseas competitors.
AfBC president Amany Asfour said the implementation of the African Continental Free Trade Area (AfCFTA) agreement would depend on the continent growing its private sector. Asfour urged the region’s governments to push for legislation in their respective parliaments that would prioritise African businesses in public-sector procurement. Her remarks came at a workshop titled “Accelerating the African Continental Free Trade Area: The Strategic Significance of the Pan-African Parliament”, organised by the Pan-African Parliament to help accelerate the implementation of the agreement.
Governments also need to build the capacity of their domestic industries in areas such as pharmaceuticals or garments to ensure suppliers are available within the continent, Asfour added. It is urgent to ensure that Africa has manufacturing industries to leverage the continent’s mineral wealth, she said.
Nigeria bourse plans commodities growth in seven African nations (Moneyweb)
Nigeria’s first private licensed commodities bourse plans to open offices in seven new African markets as it looks to take advantage of growing trade across the continent.
AFEX Commodities Exchange will expand to Ivory Coast this year and Ghana in 2024, before setting up in Benin, Togo, Tanzania, Ethiopia and Zambia, Chief Executive Officer Ayodeji Balogun said in a telephone interview. Founded in 2014, the firm already trades in nine commodities — including corn, wheat, sorghum and cocoa — in Nigeria, Kenya and Uganda.
Russia’s invasion of Ukraine has curbed shipments of essential food commodities to Africa, compounding obstacles to trade. AFEX plans to raise 30 billion naira ($65 million) of debt this year to help fund an expansion that includes boosting storage capacity to 1 million tons by 2025, obtaining more commodities exchange licenses, while adding gold and derivatives to its trading portfolio, the CEO said.
The elimination of trade barriers under the African Continental Free Trade Area, will “unlock significant value” in AFEX’s spot and exchange traded contracts, fixed income products and derivatives, according to Balogun. Daily transactions currently total about 2 billion naira.
SADC Development Finance network forum set for Swakopmund (Namibia Economist)
Local development finance institutions (DFI), namely, Agribank, Development Bank of Namibia, Environmental Investment Fund of Namibia, and the National Housing Enterprise, are set to host the 2023 SADC-DFIs network forum meetings, under the SADC Development Finance Resource Centre (SADC-DFRC).
The engagements are scheduled to be held from 6 to 9 June 2023, in Swakopmund, under the theme “Balancing DFI developmental mandate with sustainability.”
The objective of the forum is to discuss and share experiences on how DFIs have been able to mobilise appropriately priced (low-cost) capital to meet their developmental mandates and close existing market gaps, particularly in such sectors as SMMEs and infrastructure development that, due to several factors such as high risk and long project gestation periods, have traditionally been shunned by commercial banks.
Thus, the forum will discuss available resources to DFIs on the domestic and international capital markets, nature, conditions of access, and climate change financing institutions such as the Green Climate Fund among others.
West African Heads of State and ministers affirmed their commitment to accelerate investments and reforms to make fertilizers more accessible and affordable during the high-level roundtable jointly organized by the Togolese government, the World Bank, and the Economic Community of West African States (ECOWAS).
“Without vision, without strategy, fertilizers can quickly turn from a promise of soil restoration to the cause of deterioration,” said the President of the Republic of Togo, Faure Essozimna Gnassingbé. “As we need to find a proper balance, planning and state involvement are essential. I therefore support a regional approach. As exemplified by the roadmap presented today, our vision should primarily be sub-regional.”
During the event, industry leaders and development partners from the Economic Community of West Africa Agricultural Policy (ECOWAP) reaffirmed their commitments to the development of an innovative and integrated approach for sustainable soil fertility management.
Financial technology—fintech—is enhancing and streamlining the ways in which Africans produce food, transact business and build savings, paving the way for more sustainable models of growth, said expert panelists at an event at the African Development Bank’s Annual Meetings.
There was consensus on the need for close collaboration among regulators, development institutions, businesses and investors in order to harness the potential of fintech. Panelists stressed the centrality of data—collecting it and widening access to it—to the fintech transformation. The participants agreed on the need for governments and development partners to be involved in the development of fintech.
The Bank recognizes the key role fintech can play in driving innovation and more inclusive development. The sector is viewed as providing pathways to offer financial services to the unbanked and lowering transaction costs.
The Board of Directors of the African Development Bank Group has approved an equity investment of $20 million in the Africa50 Infrastructure Acceleration Fund I, in support of its target to mobilize private capital for infrastructure across the continent.
The Africa50 Infrastructure Acceleration Fund I is a pan-African infrastructure private equity fund that is mobilizing up to $500 million for investment and value creation in strategic infrastructure sectors. These include power, energy, digital and social infrastructure, transportation, logistics, and water and sanitation.
The mobilization of private capital is critical to closing the infrastructure financing gap in Africa, especially given the limited fiscal space of African governments which currently provide the largest source of infrastructure funding on the continent.
AU, ECA Unveil $2.5m Project to Tackle Migration Barriers within Africa (Ethiopian Monitor)
African Union Commission (AUC) unveiled a joint project aimed at shaping a positive narrative and eliminating barriers to safe migration within the continent. The AUC launched the $2.5 project jointly with the UN Economic Commission for Africa (ECA).
“The majority of Africans migrate within the continent, and hence the need to focus migration initiatives like those in the joint migration project,” ECA’s Deputy Secretary Hanan Morsy noted. In her remarks, Commissioner Cessouma noted “the need to tap on migration potential to drive the continental agenda with respect to its development, transformation and integration.”
The two-year project, entitled ‘International Migration in Africa: Shaping a Positive Narrative and Removing Barriers to Mobility,’ is funded by the government of Italy.
AU Commission, ATAF collaborate on tax mobilisation matters (The Chronicle)
The African Union Commission (AUC) and the African Tax Administration Forum (ATAF) have extended their cooperation by officially signing a Memorandum of Understanding (MoU), which is aimed at amplifying the continent’s voice on global tax engagements.
Commissioner for Economic Development, Trade, Industry, Mining at the AUC, Ambassador Albert Muchanga, and ATAF executive secretary Mr Logan Wort, signed the MoU during the 2nd meeting of the specialised technical committee (STC) on finance, monetary affairs, economic planning and integration sub-committee on tax at the AU Headquarters on Wednesday, 31 May 2023.
The signing of the MoU marks a significant step in strengthening the cooperation on tax policy and improving tax administration – all aimed at mobilising domestic resources in Africa and achieving Agenda 2063. In addition, the two organisations will also work on rolling out the work plans of strategies to combat illicit financial flows (IFFs) and bringing the African voice on tax matters to global discussions.
Equally, Amb Muchanga said the objectives of revenue mobilisation on the continent would be realized with a coordinated effort. As a matter of urgency, ATAF and the AUC will be convening a meeting to discuss the going global tax discussions to inform and update member states on the evolution of the UN Tax Convention and the upcoming OECD Inclusive Framework Meeting in July 2023.
The United Nations Economic Commission for Africa (ECA) has called for an inclusive international tax system and an overhaul of the global financial system as part of a global deal to secure the Sustainable Development Goals (SDGs) and enable African countries to focus their resources on sustainable and inclusive development.
Speaking at a meeting of the Second Specialized Technical Committee on Finance, Monetary Affairs, Economic Planning, and Integration of African Union whose Sub-Committee on Tax and Illicit Financial Flows is in session, Acting Executive Secretary Antonio Pedro made this call while highlighting the challenges facing African countries in generating domestic resources for economic, social, and environmental investment. According to Pedro, “the fiscal deficit in Africa is estimated at 5% of GDP in 2022 and expected to remain higher than pre-pandemic levels.”
Pedro stressed the need to raise additional resources as African countries face multi-faceted challenges, adding that a double-digit growth rate is needed to rescue the SDGs and accelerate the implementation of Agenda 2063. However, the question remains, where does this growth rate come from?
Global economy
BRICS Strive to Counter US With Expansion, Shared Currency (Yahoo)
The BRICS group of emerging markets is ramping up its bid for greater global influence and to challenge the US, sensing a moment to capitalize on a splintering world order to build out its ranks beyond Brazil, Russia, India, China and South Africa.
Foreign ministers from BRICS nations meeting over two days in Cape Town starting Thursday will be joined by counterparts from countries including Saudi Arabia, the United Arab Emirates, Egypt and Kazakhstan. On the agenda is expansion, with as many as 19 countries aspiring to join, and the potential establishment of a common currency.
“BRICS has acquired a very important stature in the world, with many countries across various continents of our world seeking to be part of it,” South African President Cyril Ramaphosa told lawmakers in Cape Town on Wednesday. Naledi Pandor, the foreign minister and meeting host, said last month the bloc could be “transformative,” representing those nations “that wish to play a role in world affairs, ensuring benefit to the Global South.”
High-growth emerging trade corridors set to outpace west, Standard Chartered finds (Global Trade Review)
Trade corridors in Africa, Asia and the Middle East are expected to grow faster than the global average, as momentum moves away from mature western corridors and high-growth routes emerge, research finds.
Exports from the three regions are tipped to grow from US$9tn in 2021 to US$14.4tn by 2030, outpacing global trade growth by nearly 4%, according to a paper published today by Standard Chartered.
Rapid industrialisation is set to establish strong export markets in South and South East Asia, while growing demand, stronger purchasing power and population growth will drive demand for imports across Africa, Asia and the Middle East, it says.
“International trade is projected to move away from the west, shifting southward and outward,” the London-headquartered lender says.
Other drivers for trade growth include the Regional Comprehensive Economic Partnership, a 15-member agreement that UN researchers believe will redirect trade away from markets in the Americas and Europe, as well as the impact of the African Continental Free Trade Area.
World trade can still drive prosperity (IMF Finance & Development)
Rising from the ashes of three disastrous decades of deglobalization, extremism, and world war, our two institutions were built on the idea that thriving international trade goes hand in hand with global prosperity and stability. On balance, the post–World War II record has been impressive. Today fewer than 1 in 10 of the world’s people are poor, a fourfold reduction since 1990, as low- and middle-income countries have doubled their share of global trade.
Yet the tide is turning against economic interdependence and international trade. Trade restrictions and subsidies increased after the global financial crisis, and tensions escalated further as governments responded to the pandemic and Russia’s war in Ukraine by scrambling to secure strategic supply chains and rushing into trade-distorting policies. Taken too far, these measures may open the door to alliance-oriented policies that reduce economic efficiency and fragment the global trading system. They could backfire if short supply chains end up more vulnerable to localized shocks. Foreign direct investment is already increasingly concentrated among geopolitically aligned countries.
WTO members explore ways of strengthening LDC economies (WTO)
“Strengthening the productive capacity in LDCs is an important priority for the international community. It has been recognized in the Doha Programme of Action for LDCs for the next decade,” said Ambassador Erik Brøgger Rasmussen, chair of the LDC Sub-Committee. The purpose of the meeting, he added, is to “look at some of the ongoing efforts aimed at strengthening productive capacity in LDCs and how some of the good practices can be scaled up.”
Supporting economic diversification and strengthening trade institutions in LDCs featured prominently in the discussions, with several speakers stressing that trade policy and trade facilitation reforms are among the private sector’s top recommendations.
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Trade statistics for April 2023 (South African Revenue Service)
South Africa recorded a preliminary trade balance surplus of R3.5 billion in April 2023. This surplus is attributable to exports of R163.8 billion and imports of R160.3 billion, inclusive of trade with Botswana, Eswatini, Lesotho and Namibia (BELN).
The year-to-date (01 January to 30 April 2023) preliminary trade balance deficit of R3.5 billion is a deterioration from the R78 billion trade balance surplus for the comparable period in 2022. On a year-on-year basis, export flows for April 2023 were R163.8 billion, which were 7.4% higher compared to R152.6 billion for April 2022. Import flows were 17.8% higher having increased from R136.1 billion in April 2022 to R160.3 billion in the current period.
The trade data excluding BELN for April 2023 recorded a preliminary trade balance deficit of R5.6 billion, with export flows at R149.9 billion and import flows at R155.5 billion.
Without AGOA South African citrus loses its edge in the US (FreshPlaza)
South Africa’s citrus exports to the United States have over recent years grown to a value of almost R1.7 billion (close to 808 million euros), a consistent performer during the past few turbulent seasons – but it is at risk if the United States decides not to extend their free trade agreement with South Africa due to the latter’s recent closeness to President Putin.
“The current US tariff on citrus for countries without any trade arrangement is within the range between $1.5/kg to $2.5/kg. That would be approximately between R30 and R50 per kg but of course, currently South African citrus does not face those tariffs in the United States,” Dr Mmatlou Kalaba of the Bureau for Food and Agricultural Policy says.
“South Africa is in a more advantageous position than other AGOA beneficiaries in the sense that we are able to produce and export a whole range of products, close to 50 different products plus processed products like cheese which gives the country the benefit of scale.”
South Africa’s participation in AGOA – due to be extended (or not) in 2025 – is under discussion because last year South Africa hosted Russian vessels currently under UN embargo at South African ports for reasons the South African government has not been willing to divulge.
Pressure mounts on Kenya to end row over Uganda’s milk imports (The Standard)
Pressure is mounting on Kenya to review non-tariff barriers involving Ugandan milk products entering the local market. Sources in the government have confided that the Kenya Dairy Board (KDB) is committed to resolving the matter in the next few days.
Uganda dairy exporters have raised the alarm over a move by the Kenyan dairy regulator to stop issuing permits for Ugandan dairy products in the KenTrade system from last March. The suspension of the issuance of permits was implemented despite the State Department for Livestock Development rescinding a notice banning dairy imports issued by KDB.
Dairy Development Authority (DDA) Executive Director Samson Akankiza told journalists that Nairobi is only issuing about 20 per cent of entry papers to exporters of its powdered milk. Sources within the industry in Kenya are, however, optimistic that the matter of export permits for Uganda firms will be amicably addressed in the next few days. “There is a lot going on within both the diplomatic and trade circles. Very soon, this matter will be amicably resolved as Kenya also needs its neighbours in its trade agenda,” a source privy to the matter said on condition of anonymity.
Kenya and Russia to sign trade pact, President Ruto says (TimesLIVE)
Kenya will sign a trade pact with Russia aimed at boosting co-operation between businesses, President William Ruto’s office said on Monday, after hosting Russian foreign minister Sergei Lavrov in Nairobi.
Russia has stepped up its drive to boost economic ties with Africa to help offset a big chill in relations with the West prompted by its invasion of Ukraine, and plans to hold an Africa-Russia summit in St Petersburg in July.
Kenya’s presidency said in a statement that bilateral trade with Russia was still low despite the potential and the pact would give business the “necessary impetus”. It did not say when the pact might be sealed or give details on what it might encompass. Russia currently sells mostly grain and fertilisers to Kenya.
Kenya to scrap visa fees for Africa traders (The East African)
President William Ruto has announced plans to remove visa requirements for African nationals travelling to Kenya for business as a first major step to remove barriers to intra-Africa trade.
The announcement was a continuation of Kenya’s policy for the integration of Africa, which began gathering steam during the reign of immediate former president Uhuru Kenyatta.
“For my fellow Africans, the free movement of people on our continent has always been a cornerstone of Pan-African brotherhood and fraternity. The freer we are to travel and live with one another, the more integrated and appreciative of our diversity we will become,” said Kenyatta on November 27, 2017.
Nairobi has for years been championing the removal of trade barriers amongst African countries to ease the movement of goods, services and labour through the integration of regional trading blocs.
Kenya was among the countries selected to participate in the pilot phase of the AfCFTA Initiative on Guided Trade last year as part of the efforts to encourage the movement of goods under preferential trading launched on January 1, 2021.
Africa’s under-developed transport networks have been blamed for raising cost of goods and services as much as 40 percent, rendering intra-African trade uncompetitive compared with trade with developed continents such as Europe.
Dar turns up the heat on Kenya in race for EAC dominance (The Standard)
Kenyans have always looked at Tanzanians as slow and courteous. A somewhat condescending view compared to their perceived abrasive nature and go-getter attitude. Kenya’s tag as the region’s biggest economy by foreign corporations and aid organisations has fed into the ego of Kenyans so much so that they do not regard Tanzania as a formidable rival in the race for regional dominance.
But in recent years, Tanzania has made remarkable progress, threatening to topple Kenya as the regional economic giant. The signs are all over, from Tanzania tripling its exports to Kenya in the four years to 2022 and its ports toppling the Port of Mombasa as the preferred route for regional importers to mega infrastructure projects that dwarf Kenya’s and a well-thought-out Standard Gauge Railway (SGR) that will seamlessly connect to its neighbours.
The recent World Bank’s Container Port Performance Index (CPPI) is perhaps the most recent pointer that Tanzania could be a giant awakening. The survey ranked the Port of Mombasa at position 326 globally ahead of the Dar es Salaam port at position 312 in 2022.
And last week, manufacturers warned of how unfriendly Kenya has become to businesses. They noted that unlike in the past when local manufacturers would opt to close down as they did not have the muscle to move to Asia or Egypt like their multinational counterparts, today they can easily move their operations across the border.
Make Agriculture a business sector – AfDB Boss (Voice of Nigeria)
The President of, the African Development Bank (AfDB), Akinwumi Adesina, has tasked the incoming administration to make agriculture a business sector. Akinwumi stated this while delivering his speech at the inaugural lecture for the new president of Nigeria on Saturday, May 27th, 2023, in Abuja. He also urged them to focus on fixing the country’s current insecurities bedevilling her economy against the backdrop of an industry amidst global challenging factors.
Speaking on inclusive development, he urged that Nigeria must completely revive its rural areas through agriculture transmission and reformation.
“The AfDB is currently working with Central banks all across Africa to design and support the establishment of Youth entrepreneurship investment banks which will be run by young professionals, highly competent and expert bankers who will develop and deploy new financial products and services for businesses and ventures of young people.” “Several African countries have agreed to set up this initiative. Hence, there is a need for Nigeria to tap into this initiative”, Adesina said.
The AfDB boss added that Nigeria’s economy needs to soar and must shift away from just import substitution to export-focused industrialization as this will unlock the bottlenecks hampering 85 per cent of its economy. “The solution, therefore, is to unlock the bottlenecks that are hampering 85 per cent of the economy. These include; low productivity, poor infrastructure and logistics, epileptic power supply, and inadequate access to finance by SMEs. Nigeria must shift away from just import substitution to export-focused industrialization. This is how our economy can thrive”, Adesina said.
Ghana remains competitive but losing ground in FDI to Senegal and Ivory-Coast (Ghana Business News)
The Ghana Netherlands Business and Culture Council (GNBCC), and the European Chamber of Commerce have affirmed Ghana’s position as the leading destination for Foreign Direct Investment (FDI) and trade with the highest competitiveness score in West Africa. These organisations, however, noted that Senegal and Ivory Coast were fast gaining ground and Ghana had to redouble her efforts to remain competitive.
Mr. Tjalling Wiarda, General Manager of the Ghana Netherlands Business and Culture Council, and Mr. Nicholas Gebara, Executive Director of the European Chamber of Commerce were speaking during an expert panel webinar to mark European Union Day held at the Institute of International Affairs, Ghana (GhIIA.org).
Mr. Gebara said, “What any European company is looking for is ease of access to large markets in Africa. So, if I can trade with Ghana, and through that gain access to the 300 million ECOWAS market as well, it will be attractive.”
FG adopts Strategy for Direct Investment Promotion (Premium Times Nigeria)
To mobilise direct investment at all levels, the Federal Ministry of Industry, Trade and Investment has held a retreat and workshop to unveil its new policy, the Federal-State Investment Strategy (FSIPS).
To be implemented by federal and state governments, their ministries, departments, and agencies, FSIPS was authored by renowned global Investment strategy expert, Nicky Okoye.
The policy, designed and developed over the last three years, forms an integral part of his work on the “National Investment Strategy”, which has been implemented by several African Countries and sub-national authorities.
He noted that the drive by the Ministry to expand its collaboration with stakeholders for repositioning Nigeria’s direct investment landscape is yielding positive results, especially as is evident by its current partnership with the African Enterprise and Entrepreneurship Institute founded by Mr Okoye.
Guided Trade Initiative: Inside CS Kuria’s Agreement With 6 Countries (Kenyans.co.ke)
Trade Cabinet Secretary Moses Kuria on Monday, May 30, explained how a new deal known as Guided Trade Initiative (GTI) had impacted export businesses between Kenya and six other African nations.
“The Guided Trade Initiative acts as a springboard to promote trade under the AfCFTA, creating a multiplier effect, more opportunities for SMEs, youth, and women in trade, and ultimately achieving inclusive & sustainable economic development,” Moses Kuria stated.
Speaking while addressing a delegation at the African Continental Free Trade Area (AfCFTA) in Nairobi, Kuria noted that the seven countries that make up the Guided Trade Initiative had agreed to remove non-tariff barriers that had previously caused a lot of delays in the movement of goods and people.
“The GTI also aims to increase opportunities for Small and Medium Enterprises (SMEs), youth and women in trade,” Kuria told AfCFTA delegates.
Kuria noted that the Guided Trade Initiative can help to reduce the cost of doing business by simplifying customs procedures and providing technical assistance to businesses.
“Guided Trade Initiative helped to increase trade by creating a more predictable and stable trading environment. It can help to promote economic development by creating jobs and stimulating investment,” Kuria noted.
It was noted Guided Trade Initiative is a new initiative, and it is too early to tell what its full impact will be. However, it has the potential to make a significant contribution to the development of intra-African trade and to the economic development of the continent.
National consultations for Drafting the Constitution for the proposed East African Community (EAC) Political Confederation concluded in Machakos County, Kenya over the weekend.
The 20-day consultations launched in Mombasa on 9th May, 2023 saw the Committee of Constitutional Experts for Drafting the EAC Political Federation Constitution hold consultations with civil society, local leaders, opinion leaders and the business community, among other stakeholders, to seek their views on what kind of a Political Confederation they would desire for the EAC.
Kenya was the third Partner State where national consultations were conducted after Burundi in January 2020 and Uganda in April 2021.
Speaking during a media briefing held after the conclusion of the consultations, EAC Secretary General Hon. (Dr) Peter Mathuki said the views gathered during the consultations will not only form the basis of drafting and promulgating the Constitution for the EAC Confederation, but also lend credibility and legitimacy to the process and the Constitution itself.
Dr. Mathuki said that some of the issues recommended by the different stakeholders during the consultations to be included in the proposed Political Confederation were: the elimination of borders to allow complete free movement, residency and trade; a common EAC identity document, and; the Confederation to create structures to handle cross-border security.
AfCFTA investment protocol a potential game changer for the continent (The Herald)
On 19 February 2023, the African Union Heads of State adopted the Protocol on Investment (“Protocol”) to the African Continental Free Trade Area Agreement (AfCFTA).
Investment protection on the continent is regulated by a web of instruments on a national, bilateral, and regional level. Of the 852 bilateral investment treaties concluded involving African states, 515 are currently in force, and 173 are intra-African. These bilateral instruments, alongside national investment laws and regional initiatives, regulate foreign investment across the continent.
The Protocol will govern investment in the free trade area and define the rights and obligations of investors and Member States. The draft protocol however notes that it will not apply to certain matters such as lawful taxation measures and property acquired for non-business purposes (Article 3.4).
Its stated objectives include the protection of sustainable investment, balancing of investor and state interests, protection of indigenous communities, and efficient dispute resolution (Article 2).
Notably, the draft protocol seeks to replace bilateral investment instruments between Member States and requires that Member States align all regional instruments with the Protocol (Article 49).
SACU focuses on free trade opportunities (New Era)
The Southern African Customs Union (SACU) Secretariat, in collaboration with the African Continental Free Trade Area (AfCFTA) Secretariat, and the United Nations Development Programme (UNDP), will host an information sharing workshop on the AfCFTA and a regional dialogue on emerging market opportunities for the SACU region. This initiative follows collaboration between the AfCFTA Secretariat and the Team Europe Technical Assistance Facility (EU-TAF) to support the AfCFTA and Continental Economic Integration.
The two-day event is scheduled to take place on 1 and 2 June 2023 in Johannesburg, South Africa. The event aims to disseminate information to relevant stakeholders within the SACU region, thereby creating synergies for the effective implementation of the AfCFTA. The outcomes of this seminar will also be used as insight for the ongoing work of sensitising the business community on the trade agreements concluded by SACU.
SACU regards the AfCFTA as a strategic continental instrument; hence, the implementation and leveraging of the AfCFTA has been prioritised as one of the pillars that underpin the recently approved SACU Strategic Plan for 2022–2027.
SACU members sign mutual recognition arrangement (South African Revenue Service)
Accredited traders in Botswana, Eswatini, Lesotho, Namibia and South Africa will benefit from lower trade costs and quicker turn-around times for imports and exports, because of a Mutual Recognition Arrangement signed today by the five Member States of the Southern African Customs Union (SACU).
The Heads of Revenue Administrations in Botswana, Eswatini, Lesotho, Namibia and South Africa, have agreed to recognise each other’s importers and exporters who have been granted the status of an Authorised Economic Operator (AEO). Traders who are AEOs across the SACU region will benefit from fast-tracked controls and reduced administration costs for customs clearance.
Experts urge removal of barriers to AfCFTA (The Guardian Nigeria)
The African Institute for Economic Development and Planning (AIEDP) and ambassadors of the African diplomatic corps have called for speedy implementation of the African Continental Free Trade Area (AfCFTA) and the Single African Air Transport Market (SAATM), urging member countries to show more commitment to removing barriers in the implementation of both projects.
They spoke at a high-level roundtable on the status, challenges and prospects of AfCFTA and SAATM, under the theme, ‘The Year of the AfCFTA: Accelerating the Implementation of the African Continental Free Trade Area.’
Both parties said they aim to generate a greater political commitment to trade as a development agenda for Africa, with a view to building linkages with member states, African Union (AU) organs, private sector actors, development partners and other stakeholders, who have important roles to play in accelerating AfCFTA’s implementation.
Africa needs to digitalise its borders to stimulate intra continental trade and travel (Engineering News)
International air transport industry-owned multinational information technology company SITA (not to be confused with South Africa’s State Information Technology Agency) senior VP: SITA at Borders Jeremy Springall has urged African countries to digitalise their border management systems. This would make it easier for people and goods to cross their borders while allowing them to protect themselves from crime, trafficking, terrorism and pandemics, yet preserving the data privacy of travellers.
“Africa’s immense potential to become a global powerhouse is undeniable,” he highlighted. “It has all the ingredients including a market of 1.2-billion consumers (rising to 1.7-billion by 2030) and a combined [gross domestic product] worth $2.5-trillion.”
Yet, despite African countries all having recognised the benefits of the African Union’s flagship African Continental Free Trade Area, Single African Air Transport Market and Free Movement of Persons Protocol programmes, these all remained far from full implementation. He reported that, at the recent SITA Borders Management Africa Summit, in Nairobi, Kenya, speakers and delegates highlighted that the biggest single hindrance to truly implementing these programmes was the lack of efficient intra-African borders to allow people and goods to move frictionlessly from country to country.
African E-Trade Group Says Working To Enhance Digital Intra, Inter Trade in Africa (ENA)
The African E-Trade Group ((Ae Trade) is working to enhance intra-and inter-trade in Africa. The African E-Trade Group (AeTrade) is a multi-stakeholder group of African professionals and business people with a vision to develop and implement e-empowerment program that will enhance intra-and inter-African trade. AeTrade Group organized a sensitization forum on Africa job creation today at the UNECA, under the theme ‘Accelerating Job Creation, Digital and Financial Inclusion in the implementation of the AfCFTA’.
Speaking on the occasion, AeTrade CEO, Mulualem Syoum, said the group brings together the public and private sector partners to develop projects that leverage the power of information and communication technologies (ICTs) for the benefit of Africa’s present and future entrepreneurs.
Following the AU decision to accelerate digital and financial inclusions and work together with all stakeholders, the Africa diaspora initiative is helping to create one Africa market, he said.
Trade is going to be knowledge based in the near future, he said, adding its platform will create enabling environment for SMEs where they can be able to know about the place of the surplus, and the shortage.
East Africa Crude Oil Pipeline will transform trade in the region (Monitor)
The East African Crude Oil Pipeline (EACOP) is a critical infrastructure project that is set to transform the national, regional, and global trade landscape. The EACOP project will enable the transportation of crude oil from Uganda’s oil fields to the Tanzania port of Tanga, where it will be exported to international markets.
The project is expected to stimulate foreign direct investment (FDI) in the region, as it creates a favorable environment for investors looking to capitalize on the growing oil and gas industry.
The project’s completion will open up new local business opportunities, particularly in the telecommunications, transport, and service sectors. This project is expected to have a significant impact on the economies of Tanzania and Uganda, as well as the greater East African region.
Let’s tap the private sector to change the “Horn of Africa narrative” say Finance Ministers (AfDB)
Finance ministers from six Horn of Africa countries gathered for the 17th Ministerial Roundtable of the Horn of Africa Initiative on the side-lines of the African Development Bank’s 2023 Annual Meetings and expressed strong consensus on the need for greater private investment and closer trade integration to increase resilience in the region.
“Regionally, we will need to focus on how the private sector can contribute to trade integration and the financing and resource gaps to support regional infrastructure without compromising debt sustainability,” said Ethiopia’s Finance Minister Ahmed Shide, who chaired the meeting.
In her opening remarks, Akin-Olugbade commended the initiative’s progress in the face of many challenges. The region has been hard hit in recent years by political instability, locust swarms and persistent drought. These compound wider constraints, including high levels of debt, and food and fuel price spikes.
The Roundtable also witnessed the signing of a $72 million financing agreement for the Djibouti-Somalia Corridor project, which the African Development Bank is supporting.
Africa should be manufacturing hub, source of ingredients – Ruto (The Star)
President William Ruto has said the African continent has a greater potential in being a source of all ingredients. Speaking during the African Private Sector Dialogue Conference on Free Trade Area, the head of state said the ambition should be realised to cut down the cost of medicines and address our quality of healthcare.
“Africa should be a hub for manufacturing. For example, Active Pharmaceutical Ingredients (API), which are the main inputs for drugs and medicine, are plenty in our continent. Africa can be the source for all APIs,” he said.
Ruto also noted that leaders should proactively seek a resolution to the disparities in currencies and the consequential impediments it poses to intra-African trade.
“Trade cannot take place without efficient and unified payment systems. Although there has been the introduction of several regional payment infrastructures in the continent, we lack a single system that seamlessly facilitates trade among our nations, eliminating the obstacles posed by varying currencies,” he noted.
“Lack of efficient transport networks increases the price of goods traded among African countries by 30% to 40%, rendering Africa effectively uncompetitive.”
EU programme falls short in promotion of export farming (Nation)
The European Commission is adopting intermediate proposals in its international climate policy, outlined in the European Green Deal that provides a road map for a socioecological transition to a low-carbon future and building blocks for a green economic growth strategy to address climate change, energy and biodiversity.
However, the implications of the EU Green Deal (EU GD) for Africa are multifaceted. Most prominently, the stringent policies outlined in the Farm to Fork (F2F) and Chemical Sustainability Strategies will greatly affect global trade in agricultural inputs and outputs, and by extension the economies of African countries that greatly depend on agriculture.
Implementing this EU GD comes will increase costs on overburdened farmers who are buying inputs at an all-time high price precipitated by the Russian-Ukraine war and high inflation rates, which have not only impacted farm productivity and profitability but increased other costs like freight and local logistics.
Economic evaluations show an introduction of a unique array of “sustainability” requirements whose compliance costs will be borne by the farmers as implementation gets underway.
Do not leave us behind, landlocked developing countries (LLDCs), plead (UNECA)
Landlocked developing countries (LLDCs) need global support to turn around their social and economic fortunes to achieve sustainable development in line with the goals of the Vienna Programme of Action (VPoA).
A High-level Africa Regional Review of the Vienna Programme of Action for the Landlocked Developing Countries for the Decade 2014–2024 which ended in Gaborone, Botswana, concluded that African LLDCs should not be left behind in attaining sustainable development.
Botswana’s Acting Minister of Trade, Mabuse Pule said LLDCs should be part of an inclusive and sustainable future. He urged that current partnerships between LLDCs and transit countries should be further strengthened.
“I implore the transit countries, development partners, relevant UN agencies and other organizations to continue this pact in the lead up to the 3rd UN Conference on LLDCs. We really need to join forces to ensure that no LLDCs are left behind as we strive towards a future that is inclusive, sustainable and prosperous for all in the next decade,” said Mr. Pule.
The two-day meeting held under the theme, “From Vienna to Kigali: towards a new decade of partnerships for a transformative Programme of Action for LLDCs’ reviewed the implementation of the Vienna Programme of Action in Africa. It discussed achievements, constraints, emerging challenges and opportunities for achieving sustainable development and SDGs and Agenda 2063 in LLDCs.
Call for accelerated action to support structural transformation of Landlocked Developing Countries
The digital economy has experienced unprecedented growth over the past few decades, transforming the global economic landscape and reshaping the way businesses and individuals interact. This phenomenon has been driven by rapid advancements in technology, widespread internet access, and the increasing penetration of smartphones and other digital devices. This includes increased consumption of digital goods and services, such as streaming platforms, e-commerce, and online advertising. The application of traditional tax principles (Nexus rules) for income tax and in the context of Value Added Tax (VAT).
These developments impact Africa’s ability to mobilize revenues while influencing tax policies and the protection of tax bases. As a result, Africa’s position in the global tax debate requires a renewed approach to tax policy initiatives, including the United Nations Resolution for a Tax Convention and the incoming international tax rules proposed by the OECD Inclusive Framework’s Two-Pillar solution. At a practical level, countries will also be confronted with the collection of revenue from digital sales of goods and services and the allocation of taxing rights on a global minimum effective tax rate.
As African countries continue to grapple with low tax collection and ever-increasing revenue demands, particularly building back from the COVID-19 pandemic, it is critical to address these issues and ensure that the African interest is protected in the design and implementation of the global tax rules. It ought not to be the case that the highly profitable large businesses keep profits that belong to countries – and their people.
The key to better trade with Africa after Brexit (LSE)
The high-income countries of the Asia-Pacific region were the UK’s primary target since trade deals with the US and China, the world’s largest and second largest economies, are not immediately possible. For the US, the Biden Administration is not making new trade deals as it manages the tricky politics of trade pessimism. For China, current geopolitics are not conducive. By the spring of 2023, the UK had concluded bilateral deals with Australia and New Zealand and acceded to the regional Comprehensive and Progressive Trans-Pacific Partnership (CPTPP), a free trade area of 11 Pacific rim countries that includes Japan, the world’s third largest economy.
For trade with some 70 developing countries mainly in Africa, the Caribbean and the Pacific, the UK replicated pre-existing EU trading arrangements. In Africa, specifically, UK versions of the EU’s Economic Partnership Agreements, which are in essence free trade deals, were concluded with 29 African countries. In 2021, the UK announced a framework for concessional trade similar to the EU’s Generalised System of Preferences in the form of the UK’s Developing Country Trading Scheme. This embodies measures for partial or full removal of customs duties on the UK’s imports from developing countries and contain important improvements over the EU’s scheme.
There is now an opportunity for the UK to improve the structure of its trade engagement with developing countries.
BRICS expanding opportunities to influence global governance (Asia Times)
This week, the five foreign ministers of BRICS (Brazil, Russia, India, China and South Africa) will meet in Cape Town. On the second day of their meet they will be joined by 15 other foreign ministers representing Africa, the Global South, and “Friends of BRICS” nations. Among other things these deliberations will seek to firm up the agenda for the BRICS Summit to be held during August 22-24 this year.
Expanding intra-BRICS trade has been the primary tool for strengthening the forum. This has lately seen increasing focus on exploring alternatives to reduce their dependence on the US dollar, and creation of a BRICS currency is expected to be on top of their agenda this week.
BRICS is seen today as the most formidable voice for the Global South on the high table of major powers of the post-World War II US-led world order. With the Ukraine war widening that bipolarity, BRICS will have to tread with care.
For BRICS to overcome its internal disjunctions and harness its historic opportunities will require not just strong mutual understanding and trust but everyday diplomatic finesse and foresight for bold initiatives. And this will remain a work in progress, as an expanded BRICS will only makes consensus that much harder to achieve.
New Global Trade Data Portal offers real-time access to trade data (WTO)
The COVID-19 pandemic and the recent crisis in Ukraine have put supply chains to the test, raising serious concerns of possible supply chain disruptions and risks to food security. Disruptions are expected to become even more frequent in the future. In parallel, the complexity of global value chains requires more detailed monitoring of trade flows.
Responding to disruptions in a timely manner and better understanding the functioning of complex value chains requires timely and detailed data, which are now more accessible thanks to new information and communication technologies. The Global Trade Data Portal can be accessed here.
“Data are the foundation of informed decision making,” said WTO Director-General Ngozi Okonjo-Iweala in welcoming the launch of the Portal. “We need timely data to support timely policy action and rulemaking.”
Continuation of the Black Sea Initiative (UNCTAD)
The Black Sea Initiative, signed in Istanbul on 22 July 2022 to resume vital food and fertilizer exports from designated Ukrainian seaports, will continue for 60 days. United Nations Secretary-General António Guterres announced the news on 17 May at the UN daily press briefing in New York, following the confirmation by the Russian Federation to continue its participation in the initiative for another 60 days.
He said the importance of the initiative – and the parallel Memorandum of Understanding between the UN and the Russian Federation on promoting Russian food products and fertilizers to world markets – is clear. “These agreements matter for global food security. Ukrainian and Russian products feed the world.” Under the initiative, more than 30 million tons of grain and foodstuffs have been exported.
Over the last year, the agreements have helped stabilize markets and reduce volatility. Global food prices have fallen by 20% from the all-time high reached in March 2022.
Goods barometer stabilizes, indicating possible turning point for trade (WTO)
The value of the barometer index rose to 95.6 in the latest reading — up from 92.2 in March — but remained well below the baseline value of 100, suggesting a below-trend stabilization and the beginnings of an upturn in merchandise trade volumes. Mixed signals in the barometer’s component indices nevertheless suggest that the road to trade recovery may be bumpy.
The volume of merchandise trade in the fourth quarter of 2022 was down 2.4% compared to the previous quarter and 0.8% compared to the same period in the previous year. The Q4 slump was driven by several related factors, including the ongoing war in Ukraine, stubbornly high inflation in advanced economies, and tighter monetary policy globally.
Economic woes dash job prospects in low income countries: ILO (UN News)
In its new Monitor on the World of Work report, ILO shows that while in high-income countries, only 8.2 per cent of people willing to work are jobless, that number rises to over 21 per cent in low-income countries - or one in every five people.
Low-income countries in debt distress are worst affected, with more than one in four people who want to work unable to secure employment. The UN agency further indicated that Africa’s labour market had been hit the hardest during the pandemic, which explained the slow pace of recovery on the continent.
Unlike wealthy nations, debt distress across the continent and a very limited fiscal and policy space, meant that few countries in Africa could put in place the kind of comprehensive stimulus packages they needed to spur economic recovery, ILO explained.
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Announcement of Protection for R1,7 Billion Cut-Flower Export Industry (The Department of Trade, Industry and Competition)
Minister of Trade, Industry and Competition, Ebrahim Patel, today announced that the application submitted by Cape Flora SA to protect the name “Cape Flora” and its logo has been approved and has been published in the Government Gazette. The next step will be for Cape Flora SA to apply for a Geographical Indication (GI), and the industry is considering this.
GIs are signs or logos identifying goods that have a specific geographical origin and possess a given quality, reputation or other characteristic that is essentially attributable to that origin. Rooibos, Honeybush and Karoo Lamb all are registered GIs and are subject to international protection.
South Africa is currently the third-largest exporter of cut flowers on the African continent with exports of over R1,7 billion in 2021. Cape Flora SA, the fynbos cut-flower association, says South African flower exports are dominated by the indigenous flora (proteas, pincushions, greens), most of which are cultivated in the Western and Eastern Cape, but also sustainably harvested from the veld. The Cape Floristic Region is one of the most biodiverse areas in the world and therefore contains incredible species diversity.
the dtic to Host AfCFTA Provincial Awareness Workshops Across South Africa (The Department of Trade, Industry and Competition)
The Department of Trade, Industry and Competition (the dtic) will host a series of awareness workshops on the African Continental Free Trade Area (AfCFTA) throughout the country starting at the Pavilion Hotel in Durban, KwaZulu-Natal on Thursday, 25 May 2023.
The aim of the Provincial Awareness Workshops is to communicate and engage private sector, Small and Medium Enterprises, as well as women and youth-owned business on the implementation of the AfCFTA, including the opportunities for South Africa to participate in preferential trade beyond the Southern Africa region
According to the Deputy Director-General of Exports at the dtic, Ms Lerato Mataboge, the objective of these workshops is also to identify companies, within the provinces, in the targeted sector masterplans, as well as other priority sectors to export to the rest of the continent.
She adds that the inaugural AfCFTA Business Forum hosted in Cape Town last month created a platform where both the private and public sector from across the continent were encouraged to work together in the implementation of the AfCFTA.
“African economies were urged to prioritise closing the infrastructure gap in order to increase intra-Africa trade by over 30% in order to fully realise the potential of the AfCFTA. For instance, it was noted that transportation infrastructure alone has the potential to double the transportation of goods by air from 2.3 million tons to 4.5 million tons,” says Mataboge.
DR Congo Leader to Visit China This Week, Minerals Trade Deal Signing Expected (VOA)
The president of minerals-rich Democratic Republic of Congo, Felix Tshisekedi, will visit China from May 24 to 29 and is expected to meet President Xi Jinping to review and sign several key trade deals.
A meeting would pave the way for the two countries to formally overhaul and seal a $6 billion infrastructure-for-minerals deal with Chinese investors. The visit was announced by the Chinese foreign ministry on Monday.
During the visit to China, the two heads of state will hold talks and attend the signing ceremony of cooperation documents together, the Chinese foreign ministry said.
“Both sides have always supported each other on issues related to each other’s core interests and major concerns. In recent years, political mutual trust between China and the Democratic Republic of Congo has been continuously deepening, and practical cooperation has yielded fruitful results,” Mao added.
Kenya begins shipping fruits, flowers by sea (The East African)
Kenya has last week began transporting horticultural produce by sea in a move officials say will reduce the carbon footprint and improve earnings. This follows a pact with the European Union, one of Kenya’s major export destinations, to transport fresh produce via sea after Mombasa port complied with requirements.
It means all verification of perishable goods by regulatory agencies will be done at the point of loading and permit approvals granted at the single window system to facilitate track-and-tracing. With the installation of the reefers, Kenya intends to use Mombasa to end dependency on air freight for horticulture produce.
Consumers, especially in Europe, are on the frontline of this push for a radical decarbonisation of value chains that deliver fresh produce to their supermarket shelves and dining tables.
Several companies have started to use sea freight for export of flowers, vegetables and fruits but the sector is now aiming for a transformative and larger shift in the push for climate change action.
Dar port’s $357m upgrade bears fruit, topples Mombasa from perch (The East African)
The $357 million Dar es Salaam Maritime Gateway Project (DMGP) seems to be bearing fruit: The World Bank has put Dar above its main regional competitor, Mombasa, in a new port efficiency ranking.
The Port of Dar es Salaam rose to position 312 in the 2022 Container Port Performance Index (CPPI) against Mombasa’s position 326 in the survey of 348 ports globally, making it the preferred facility by East African shippers. Djibouti ranked at 26 and the port of Berbera (Somalia) at 144.
Dar port managers attribute the noted success to infrastructure improvements and capacity building, which have helped address operational and physical constraints at the facility.
Tanzania and India explore local currency trade to reduce dependency on dollars (Business Insider Africa)
Following the recent declaration that both nations will start trading in their own indigenous currencies, they talked about the ramifications of the Rupee Nostro Account System. The debate emphasized several major benefits, one of which was the decrease in dependence on hard currency.
The system has enormous potential for corporate organizations, which can efficiently manage their foreign exchange balances and avoid exchange risks associated with fluctuating global currencies, according to Mr. Antaryami Sarangi, managing director of Bank of India in Tanzania.
The system’s potential to reduce the need for ongoing currency conversions and dependence on foreign exchange reserves encouraged stakeholders.
“The banking sector also stands to gain from implementing this system. Banks could facilitate importers by providing them with increased flexibility and reduced dependencies on hard currencies. This would streamline trade processes and enhance the overall efficiency of cross-border transactions,” he said.
Kenya, Uganda signal recovery on coffee front (The East African)
Kenya and Uganda are expected to increase their coffee exports in the marketing year 2023/24, as government efforts to increase production come to fruition. According to a forecast by the Global Agricultural Information Network-Gains, Uganda’s production will reach a record high of 6.85 million 60 kilogramme bags, a 4 percent increase attributed to good rainfall and the maturation of new high-yielding Robusta variety planted between 2017 and 2019.
Kenya’s production is forecast to increase 6.7 percent to 800,000 bags due to recovery from drought conditions and higher fertiliser application.
While Kenya’s total area harvested is expected to remain flat, at 105,000 hectares, due to a shortage of planting materials and losses associated with conversion of coffee plantations to real estate, in Uganda the acreage under coffee is increasing.
IMF Executive Board Concludes 2023 Article IV Consultation with Mali (IMF)
Mali’s economy has been hit by multiple shocks since 2020 but remained resilient in 2022 amid high inflation. Real GDP growth increased from 3.1 percent in 2021 to 3.7 percent in 2022, despite elevated security and socio-political challenges, regional sanctions in the first half of 2022 and a high incidence of food insecurity. Growth is projected to rebound to over 5 percent in 2023 and 2024, assuming strong agricultural and gold output. However, the economic outlook is subject to significant downside risks. They include a worsening security situation, potential election delays, volatile international commodity prices, tighter global financial conditions, and climate risks.
Mali’s current account deficit improved slightly in 2022, down to 6.9 percent of GDP from 7.5 percent in 2021, on account of higher gold exports and lower capital goods imports. In the medium term, the current account deficit will fall to below 4 percent due to strong gold and agricultural exports.
Kingdom of Lesotho: Staff Concluding Statement of the 2023 Article IV Mission (IMF)
While the COVID-19 health crisis has largely abated, Lesotho’s structural challenges and capacity constraints have reasserted themselves as severe obstacles to growth. The secular decline of key sectors continues to weigh on the economy with growth largely dependent on infrastructure mega-projects and developments in South Africa. While growth averages 2.1 percent over the medium term, it is expected to decline once phase II of the Lesotho Highlands Water Project has passed its construction peak. The war in Ukraine raised prices to the benefit of the mining sector but eroded living standards and food security. Inflation is expected to have peaked in FY22/23 and subside gradually over the medium term to just under 5 percent as global food and energy prices ease.
While recent transfers from the Southern African Customs Union (SACU) (over 20 percent of GDP) present an opportunity—if well-managed—to finance fiscal adjustment and alleviate financing constraints, the fiscal outlook is highly sensitive to changes in revenue and expenditure should reform momentum slip, with implications for debt and the external position.
The growth outlook remains subdued and contingent on undertaking fiscal consolidation and structural reforms in tandem, alongside external developments .
Angola casts net wider to scale up fish exports (UNCTAD)
Angola boasts a vast coastline, ample labour in the fisheries sector and good trading relations with major fish importers in Europe and Asia. With the fish traded globally expected to rise from 187 million tons in 2018 to 250 million tons by 2030, Angola stands to benefit from this opportunity.
Angola overly depends on crude oil, which represents 93% of its exports. Low productivity and meagre opportunities in other economic sectors have left a third of the population below the poverty line. Fluctuating oil prices underscore the need to diversify the country’s economy and exports.
“The fisheries and aquaculture sector can help Angola diversify its economy and move closer to achieving its development goals,” said Paul Akiwumi, director of UNCTAD’s division for Africa and least developed countries.
He said Angola can create more jobs, trade opportunities, boost food security, improve livelihoods and reduce poverty by tapping more into the blue economy – the sustainable use of ocean resources for economic growth.
Rwanda sets out strategy to spur e-commerce growth (UNCTAD)
As a landlocked economy undergoing massive transformation, Rwanda is increasingly gaining international attention for its forward-looking digital policies.
Such policies, in part, aim at boosting the country’s emerging digital economy through a coordinated “whole-of-government” approach, backed by a national e-commerce strategy recently published by UNCTAD.
“The national e-commerce strategy of Rwanda marks an important milestone in strengthening the country’s policy framework for easing digital trade,” said Shamika N. Sirimanne, UNCTAD’s director of technology and logistics.
Rwanda, one of the most densely populated nations in sub-Saharan Africa, has made progress towards graduating from the UN’s category of least developed countries, where it has been since 1971.
With the new strategy, experts are optimistic that Rwanda will better capitalize on e-commerce for the benefit of businesses and consumers, as well as optimize the delivery of government services.
“E-commerce growth is a unique opportunity to open access to international and local markets for our small and medium-sized enterprises,” said Jean Chrysostome Ngabitsinze, Rwanda’s minister of trade and industry.
Trade Policy Review: Liberia (WTO)
Liberia is a natural resource-based economy exporting mainly iron ore, gold, and natural rubber (together accounting for about 80% of merchandise exports), as well as palm oil, timber, and diamonds. It has the second-largest shipping registry in the world after Panama. However, the per capita income of Liberia’s 5.2 million people was approximately USD 673 in 2021, which is less than USD 2 a day, and about half of the population remains in poverty. Net remittances (about 7% of GDP in 2020) and foreign aid (about 19% of GDP) are important to the economy. Key factors holding back Liberia’s economic development include poor infrastructure, inadequate investment in human capital, and corruption.
Trade plays an important role in the economy. Trade in goods and services was equivalent to about 72% of GDP in 2021, and trade taxes collected at the border contributed over 40% of tax revenues. The Government’s Pro-Poor Agenda for Prosperity and Development 2018-2023 aims to promote exports to other ECOWAS countries, which currently are marginal. Liberia lacks reliable and up-to-date trade data. Based on available information, most of its exports are destined for the European Union, followed by Switzerland and the United States. Imports come mainly from India, followed by ECOWAS countries, China, and the United States. Liberia is a net importer of food and relies entirely on imported petroleum products.
African trade and integration
African free trade area could spur sustainable growth: UN chief (UN News)
Mr. Guterres was speaking on the final day of the annual Africa Dialogue Series in New York, where the focus this year was on accelerating implementation of the African Continental Free Trade Area (AfCFTA) – set to be the largest in the world. He said the pandemic brought high food and energy prices, made worse by the Russian invasion of Ukraine, exacerbating poverty, inequalities, and food insecurity.
Governments have also faced rising interest rates, increasing the potential for debt, while climate change has created deadly floods and drought, contributing to the risk of hunger.
“Guided by the 2030 Agenda for Sustainable Development and the African Union’s Agenda 2063, we must ramp up our efforts and harness the full potential of trade and industrialization to advance sustainable, inclusive growth,” the UN chief told participants.
He said the AfCFTA is set to be an engine of that growth. The Secretary-General stressed that realizing the AfCFTA promise calls for action across four critical areas, starting with boosting access to financial resources and investment.
The ECA’s Country Business Index – a tool to enhance private sector’s role in AfCFTA implementation (UNECA)
To better understand how African businesses are approaching the AfCFTA and how it can best support the private sector through trade, ECA developed the AfCFTA Country Business Index (ACBI) with the financial support of the European Union (EU). The Index enables relevant policymakers to identify bottlenecks in intra-African trade at a country level, which identifies the barriers impeding effective AfCFTA implementation from the perspective of the private sector.
Recently, the ECA held an Expert Group Meeting (EGM) to present the methodology and findings of the Index to inform the implementation of the AfCFTA.
Opening the meeting, ECA Deputy Executive Secretary and Chief Economist, Ms. Hanan Morsy said, “The ACBI is the first comprehensive tool based on robust methodological framework for data collection and analysis through which businesses can voice their views on the implementation of the AfCFTA. The ACBI findings make a significant contribution to Africa’s development Agenda by identifying bottlenecks in trade regimes that need to be addressed to ensure a more inclusive trade under the AfCFTA.”
African Trade Policy Center Director, Melaku Desta, emphasized that the success of the AfCFTA depends on its implementation and the participation of the private sector, which needs to understand, own, and drive it and aim to take advantage of the opportunities the Agreement offers. “Through the ACBI, we are contributing to make sure that business communities are in the driving seat in the implementation of AfCFTA,” he added.
Keys to Unlocking the Full Potential of the AfCFTA – A Case Study for Central Africa (UNECA)
Free trade under the AfCFTA Agreement officially started on 1 January 2021. In response, Central African governments began developing national AfCFTA implementation strategies with the support of the ECA and its partners. A sub-regional AfCFTA strategy for Central Africa is also under development. The AfCFTA is a key opportunity for Central African governments to build upon regional integration strategies, aligning their national trade strategies as well as industrial strategies, to enhance intra-regional trade as well as trade with continental partners. Trade strategies are linked to the productive capacity of each country, and therefore the development of trade strategies re-quires direct linkages with the National Industrialization Plans which, for Central Africa, advocate industrialization based on natural resources and driven by trade, in line with the Douala Consensus. At the sub-regional level, the two regional economic communities (ECCAS and CEMAC) stressed the urgency of developing a Master Plan for Industrial Development and Economic Diversification of Central Africa (PDIDE-CA) in the context of the AfCFTA.
Preliminary results show that liberalizing tariffs within the African continent would lead to overall increases in trade among member countries of the ECCAS across all products, except for extraction products which decrease. Trade between ECCAS members and the rest of the continent increases across all products. Extra-continental trade decreases. The most important increases in trade for ECCAS as a subregion occur for heavy and light manufacturing as well as processed food. While the largest current increases in trade for the ECCAS subregion represent import substitution (rest of world imports replaced by rest of Africa imports), simulations illustrating the implementation of economic diversification and industrialization plans are anticipated to increase trade within the ECCAS subregion as well as boost exports to the rest of the continent.
The African Institute for Economic Development and Planning, in collaboration with the ambassadors of the African group of the diplomatic corps accredited to Senegal, organized a High-level round table on The status, challenges and prospects of the African Continental Free Trade Area (AfCFTA) and the Single African Air Transport Market (SAATM) on Wednesday 24 May 2023.
This round table is a IDEP contribution to the celebration of Africa Day, celebrated on May 25, and that coincides this year with the celebration of the sixtieth anniversary of the Organization of African Unity (OAU), now the African Union (AU), under the slogan “Our Africa, Our Future”. It is also during this year 2023 that UNIDEP celebrates its 60th anniversary.
This year, the theme chosen is in line with the African Union’s 2023 theme of “The Year of the AfCFTA: Accelerating the Implementation of the African Continental Free Trade Area”. The theme aims to generate greater political commitment to trade as a development agenda for Africa. It will serve to mobilize solutions and solidarity to turn this vision into reality, with a view to building linkages with member states, AU organs, private sector actors, development partners and other stakeholders, who have important roles to play in accelerating the implementation of the AfCFTA.
“Both projects, AfCFTA and SAATM, are linked and reinforced each other. The AfCFTA has amongst other specific objectives to contribute to the movement of capital and people and facilitate investments. An effective functioning of the SAATM, on its turn, would allow residents of the region gain in comfort and choice of airlines, reduced flight times, business opportunities, and strengthened cultural ties through the progressive development of business and leisure tourism” highlighted Karima Bounemra Ben Soltane, IDEP Director.
Collective action can “move mountains” for Africa (UNECA)
Deputy Executive Secretary and Chief Economist of the Economic Commission for Africa (ECA), Hanan Morsy, has called for continued collective action in support of the Africa High-level Working Group on Global Financial Architecture (HLWG). “Our key objective is to build African consensus on what needs to be done and amplify the continent’s voice on the global stage,” said Ms. Morsy, adding, “The work of this group (HLWG) shows that when we come together, we can move mountains.”
“Debt service composes 22% of revenue” in Africa, limiting countries’ ability to make essential investments in health, education, and infrastructure to help operationalize the AfCFTA.” Ms. Morsy underscored the urgent need to fix the global debt architecture so that countries in debt distress can obtain swift and effective debt restructuring.
Trade has been at the core of life in developing and developed countries alike for many centuries and remains the life-blood of Basotho to-date. Over the years we have added our footprint in the flow of ideas, people, and goods & services, by innovating our trade facilitation processes. As we highlight the importance of the AEO Programme we must not lose sight of the bigger picture in the international trade facilitation programmes. The Authorized Economic Operator is one of those facilitative programmes that can enhance efficiencies in international trade as a way to quicken the drive for trade competitiveness.
in the context of rising global trade issues, regional trade facilitation mechanisms are a key strategy to boost existing and emerging trade arrangements, reducing costs to trade, and fueling inclusive growth. Such a mechanism can also make a difference in our ability to face the long-term challenges confronted by our region by facilitating market access, strengthening value chains, and boosting our regional economy.
The Authorized Economic Operator Programme directly complements the WTO Trade Facilitation Agreement’s Article 7.8, which is in relation to Expedited Shipments. The implementation of this provision is especially important at a time of escalating costs in terms of transportation of goods. Despite the surge in international shipping costs, it is my belief that developments in streamlining trade facilitation could partially suppress such an increase in cost of trading across borders. Whilst undertaking various reforms to implement. The TFA in respective countries, fostering regional cooperation is critical to tackling vulnerabilities of regional value chains. There is a wealth of distinct experiences and institutional frameworks across countries, and this underscores the importance of mutual learning and experience sharing. Together we can continuously agree on a set of key measures, where collective action can reduce the time and cost of trading across borders.
SADC and Member States step up efforts to attract Foreign Direct Investment (SADC)
The SADC Secretarial held the SADC Regional Focus Forum at the 12th Edition of AIM Global 2023 to attract FDI under the theme ”Infrastructure Development in Support of Industrialisation and Regional Integration”. The SADC Regional Focus Forum hosted two High-Level Panel discussions on Coordination and Investment Opportunities for Unlocking the Development of Regional Infrastructure Projects; and on Industrial and Value Chains Development.
In her opening remarks at the Forum, Ms Stella Chimwemwe Ng’oma, Director Investment Promotion and Facilitation, Malawi Investment and Trade Centre, said SADC desires to discuss good practice in public-private investment partnerships and create a mechanism to develop cross-cutting networks involving Member States, investors, bankers, development partners in order to re-engineer investment plans of Member States to be more catalytic and dynamic tools of investment attraction for sectoral development.
She said Member States recognise that despite SADC having made significant progress in regional infrastructure development, the economic transformation of the Region will require adequate and functioning infrastructure that will guide it towards front-loading industrialisation in the context of evolving technologies. This means that the Infrastructure Development in support of Regional Integration will aim towards interconnected, integrated, and quality seamless infrastructure and networks, including cross-border infrastructure, which will be pivotal in facilitating the movement of people, goods, services, and knowledge.
SADC convenes its Annual Financial Inclusion Forum (SADC)
The Southern African Development Community (SADC) Secretariat, through the European Union-funded Support to Improving the Investment and Business Environment in the SADC Region (SIBE) Programme, in conjunction with its partners FinMark Trust, United Nations Capital Development Fund (UNCDF), and the SADC Banking Association, convened its Annual Financial Inclusion Forum to discuss, among others, the proposed new five-year SADC Strategy on Financial Inclusion and Small and Medium Enterprise (SME) access to finance, in Johannesburg, South Africa, from 18th to 19th May 2023.
Financial inclusion means that individuals and businesses have access to useful and affordable financial products and services that meet their needs – transactions, payments, savings, credit and insurance – delivered in a responsible and sustainable way. Several SADC Member States have developed strategies on financial inclusion in order to improve access, uptake, and utilisation of quality financial services and products for consumers and SMEs for effective participation in the SADC Industrialisation Strategy and Roadmap.
In his keynote address at the opening of the Forum on 18th May 2023, Honourable Karabo Gare, the Minister of Entrepreneurship of the Republic of Botswana, underscored the importance of Financial Inclusion in many African countries, where the informal sector relies heavily on remittances, savings groups, and credit associations. Financial inclusion plays a significant role in improving livelihoods, contributing to sustainable economic growth, promoting stability, and can support industrialisation, which is core to SADC.
However, achieving meaningful Financial Inclusion is not without its challenges as there are several barriers that hinder access to financial services, particularly for marginalised and vulnerable populations. These barriers include inadequate infrastructure, limited financial literacy, high transaction costs, rigid regulations, and discriminatory practices. Addressing these barriers requires a comprehensive approach involving governments, financial institutions, regulators, and civil society organisations.
The Southern African Development Community (SADC) Ministers responsible for Agriculture, Food Security, Fisheries and Aquaculture met through videoconferencing on 19 May 2023, to review progress in the implementation of the SADC relevant sectoral programmes, projects, and related strategies under the Regional Agricultural Policy (RAP), in line with the Regional Indicative Strategic Development Plan (RISDP) (2020-2030).
During her welcoming remarks, the Deputy Executive Secretary highlighted that the region experienced numerous challenges in recent times, including severe droughts and floods which adversely affected the agricultural sectors and food security. As a result, this led to the loss of, lives, revenue, jobs, and livelihoods. She added that overfishing led to a depletion of fish stocks, thereby affecting the livelihoods of many citizens in the coastal towns, hence the need for sustainable solutions to improve food security.
EAC Partner States’ commitments key to implementation of Common Market Protocol (EAC)
East African Community (EAC) Partner States’ commitments to the free movement of capital, services and goods is the bedrock of trade integration in East Africa, EAC Secretary General, Hon. (Dr.) Peter Mathuki, has said.
Dr. Mathuki said that the commitment of Partner States was especially critical in the removal of tariff and non-tariff barriers and the harmonisation of standards. Dr. Mathuki said trade integration was crucial particularly now that the Community is on a trajectory of expansion with the admission last year of the Democratic Republic of Congo even as the Federal Republic of Somalia awaits her turn to join the bloc.
The Secretary General said that the Community was looking towards not just a borderless East Africa but a borderless continent to spur intra-regional and intra-continental trade as is happening in Europe and other parts of the world.
The Competition Authority of Kenya (CAK) and the East African Community Competition Authority (EACCA) have entered into a Memorandum of Understanding (MoU) to ensure execution of their respective mandates enhances regional integration and cross-border trade and investment.
The MoU lays out modalities through which the agencies will mitigate competition infringements with cross-border effects, as well as foster transparency and predictability with regard to multijurisdictional merger notifications in order to reduce transaction costs for businesses.
Further, the agreement facilitates information sharing particularly during joint investigations, market inquiries and studies, which shall be prioritized so as to safeguard the competition process and protect consumers in the region, while respecting our respective laws and policies.
President Ruto urges the Committee of Experts Drafting the Constitution for the EAC Political Confederation to have the first draft by June 2024 as he pledges US$1 million to support the process.
President Ruto said that East Africans wanted to live together and do business regardless of national boundaries and urged EAC Partner States should therefore endeavour to catch up with them and actualise the Political Confederation as fast as possible,” said President Ruto.
Dr. Ruto cited prosperity for the region, strategic economy and security and the fact that East Africans were peoples of the same origins as the major reasons why the region needs to integrate and embrace the unity of the region.
President Ruto said that a borderless Africa would benefit from the prosperity that comes with integration, noting that integration would provide for a bigger market for the goods and services produced by the people of the region.
Botswana will host High-Level Africa Regional Review Meeting of the Vienna Programme of Action to address challenges facing LLDCs. The meeting will be held under the theme, “From Vienna to Kigali: towards a new decade of partnerships for a transformative Programme of Action for LLDCs” in Gaborone, Botswana from 29-30 May 2023.
LLDCs are countries without territorial access to the sea as a result isolation from world markets and high transit costs impose serious constraints on their overall socio-economic development. For LLDCs, their seaborne trade almost always must transit through other countries, mostly also developing countries—a process which involves dealing with cumbersome border-crossing procedures and inadequate transit transport infrastructure. Thus, although LLDCs already face other development challenges, they also face substantially increased costs for trade and transport because of their geographic location.
The African Development Bank Group’s 2023 Annual Meetings officially opened on Tuesday, with a clarion call by African leaders, together with the Bank’s President, Dr Akinwumi Adesina, to ramp up financing to meet Africa’s urgent climate action goals.
In his welcome remarks, Adesina drew attention to the vast gap in resources for climate action. He said while Africa’s cumulative climate financing needs had been estimated at $2.7 trillion between 2020 and 2030, climate financing resources were only flowing to Africa in trickles. “Africa receives only 3% of global climate finance, of which 14% is from the private sector, the lowest in the world,” Adesina said.
In his opening remarks, Egyptian President Abdel Fattah El-Sisi said the complex challenges facing countries around the world, and especially those in Africa, needed what he described as creative solutions. “This requires non-traditional ideas to explore financing options, to contribute to pushing the wheel of much-needed projects, particularly in the fields of addressing climate change challenges and sustainable development,” President El-Sisi said.
I heard that we should have a just and fair energy transition, and assure that we have energy access, affordability, and security for Africa. That Africa needs to use its natural gas for solving its energy challenge, including gas to power, liquified natural gas for cooking to save the lives of millions of women, who die every single year using dirty fuels, charcoal, and firewood; and there are children that die with them for just trying to make what we take for granted – making a decent meal for their families.
We heard about the reform of the global financial architecture, and how critical this is, and the reforms should strengthen, not diminish, the roles of the multilateral development banks that are in the regions like ourselves; because it’s not just the global public goods that matter; global public goods land in regions, in countries, in communities; and the regional multilateral development banks know their regions, are present in their regions, have strategies for their regions, are trusted by their regions and deploy policy instruments in dialogue with their regions better than anybody else can do because they are trusted in those regions.
Africa is set to be the second-fastest growing region in the world after Asia in 2023-24, demonstrating the resilience of its economy despite dealing with multiple global shocks. But the projected growth will depend on global conditions and the continent’s ability to bolster its economic resilience, the African Development Bank’s 2023 African Economic Outlook report has found.
The report, launched on Wednesday, forecasts that Africa will consolidate its post-Covid-19 pandemic recovery to 4.3% GDP growth in 2024 from 3.8% in 2022. Some 22 countries will record growth rates above 5%, it says. It recommends robust policy actions, including incentivizing green industries and providing guarantees at scale to de-risk private sector investments in managing natural capital across the continent.
In its latest annual report released on 25 May 2023, the African Development Bank Group highlights its critical contributions to the continent’s development and the wellbeing of its people in 2022.
Against the backdrop of a continent still grappling with the residual impact of the COVID-19 pandemic, the 2023 edition of the Annual Development Effectiveness Review, titled ‘Enhancing Africa’s Resilience’, reflects on the impact of multiple shocks to the continent.
In 2022, the Bank’s bold response to the challenging operating environment saw it leveraging its resources, technical expertise and role as partner of choice among African countries, to deliver tangible development results across the High 5s. The result: 12.3 million people gained access to new or improved water and sanitation services while another 4 million people benefited from the Bank’s private sector investee operations. To support the continent’s economic development and connectivity, the Bank also facilitated the construction or rehabilitation of 833 kilometres of roads.
Another milestone in the report shows investments in 2022 reaching $8.2 billion, signalling a return to pre-pandemic levels.
DP World And Standard Bank Partner To Expand Trade Finance In Africa (Africa.com)
The continent’s largest bank becomes the first African bank to partner with DP World Trade Finance. African companies looking for trade finance will now be able to seamlessly access working capital from Standard Bank via the DP World Trade Finance platform.
DP World Trade Finance connects business with financial institutions as a fintech platform while also directly offering trade finance facilities on its own. It offers businesses a single window to access trade finance solutions – customers can simply apply for credit on the digital platform, which will present them with the best options from global financiers who may otherwise be out of their reach. Access to finance is one of the biggest barriers for businesses seeking global trade opportunities, evidenced by the struggle that many businesses face in securing the upfront funds required to move cargo.
The President of the Union of Comoros and Chairperson of the African Union (AU), President Azali Assoumani has pledged support for the realisation of the mandate of the Pan-African Parliament as the legislative arm of the AU. He was speaking as a Guest of Honour at the opening of the Second Ordinary Session of the Sixth Parliament, which is currently underway in Midrand, South Africa, under the AU theme for 2023, “Accelerating the implementation of the African Continental Free Trade Area (AfCFTA)”.
H.E. Assoumani further encouraged African legislators to help establish appropriate conditions to promote socio-economic development in the continent.
“Our continent is indeed full of many natural resources with the potential to become one of the largest markets in the world in the years to come, if we create, right now, the appropriate conditions, to promote socio-economic development for a sustainable economy. We have succeeded to set up the African Continental Free Trade Area (AfCFTA), and it has become our continental priority. The Assembly of Heads of State and Government of our Union gave me the mandate to prioritise mechanisms to accelerate the implementation of this important free trade agreement,” he added.
Muddled priorities continue to plague EU-Africa trade policy (EUROPP)
As geographical neighbours, Africa and Europe have a long trade history. But the current trade policy priorities of the two neighbours are in a muddle. This is due to the balkanising effect of the EU’s patchwork of trade agreements across the African continent at a time when African countries are pursuing an ambitious economic integration reform agenda through the African Continental Free Trade Area (AfCFTA). As shown in a new edited volume, fixing this misalignment in trade policy priorities requires a reset.
The EU is Africa’s most important trading partner. As a source of imports, the EU accounts for 26 percent of all imports in terms of value into African countries, followed by China (16 percent), and intra-African imports (15 percent), on average between 2018 and 2020, according to IMF data. Other partners such as the US (5 percent) and the UK (2 percent) are important, but much less significant sources of imports into African countries.
The destination of Africa’s exports closely mirrors, in order of economic importance, Africa’s imports. The EU is Africa’s most important destination for exports – also accounting for 26 percent of all African exports in terms of value, followed by intra-African exports (18 per cent) and China (15 percent) between 2018 and 2020. India (6 per cent) the US (5 percent), Turkey, Brazil, UK, Japan, and Russia (each under 3 percent) are smaller export destinations.
The economic impact of EU’s Green Deal on farmers in Eastern Africa (The East African)
The European Commission is adopting intermediate proposals in its international climate policy as outlined in the European Green Deal.The Green Deal provides a road map for a socioecological transition to a low-carbon future and the building blocks for a green economic growth strategy to address climate change, energy, and biodiversity. However, the implications of the EU Green Deal (EU GD) for Africa are multifaceted.
Most prominently, the stringent policies outlined in the Farm to Fork (F2F) and Chemical Sustainability Strategies will greatly affect global trade in agricultural inputs and outputs and, by extension, the economies of African countries that greatly depend on agriculture.
Economic evaluations show an introduction of a unique array of “sustainability” requirements whose compliance costs will be borne by the farmers as implementation gets underway.
The new additional requirements threaten the livelihoods of many small producers and may significantly reduce the export earnings of East African countries such as Uganda, which is the second largest horticulture exporter in the region.
Horticultural exports from East Africa to the EU are valued at more than $2.3 billion, with smallholder farmers contributing up to 70 percent of the export volumes. The study revealed that farmers would be overburdened by the new regulations because substantial costs will be introduced with the new specifications on standards, certifications, logistics, and carbon border adjustment mechanisms (CBAM).
Bumper US$3 billion trade boost in Hunan bid to become China-Africa hub (South China Morning Post)
Efforts by Hunan province to position itself as a hub for China-Africa trade are bearing fruit, with a record 90.4 per cent trading increase to US$3.14 billion in the first four months of 2023 on the same period last year.
Private enterprises are driving the boost, with 1,471 companies accounting for 20 billion yuan (US$2.8 billion) – more than 90 per cent of Hunan’s African trade total – over the period, according to Changsha Customs data.
The number of Hunan companies trading with Africa so far this year is also on the rise, increasing by 18 per cent to 1,558 compared to the first four months of last year.
China woos Horn of Africa by fragmenting diplomatic engagements, investments & trade (Republic World)
The People’s Republic of China has been fragmenting diplomatic engagement with the Horn of Africa (HoA) to cement its foothold in the conflict-ridden region. Chinese President Xi Jinping’s administration has been shifting the dynamics of its geopolitical influence in sub-Saharan Africa as the United States and its European allies made an exit, including the ex-colonial ruler France which was asked to pull out its troops from insurgency-hit Burkina Faso. The Horn of Africa comprises six states— Ethiopia, Eritrea, Sudan, Djibouti, Somalia and the self-governing state of Somaliland—of whom five are sovereign states and one is de facto, where China is now expanding its footprint.
On Thursday, May 25, China announced that it is stepping up its cooperation with the African countries by sending more emergency food aid to the Horn of Africa. China’s Foreign Minister Qin Gang said in Beijing on Thursday that PRC will fund the reconstruction of Ethiopian infrastructure destroyed in the year-long Tigray war, according to the Beijing-based newspaper South China Morning Post.
China has been weaponising investment on foreign soils as a part of its ’debt-trap diplomacy’ to fulfil agendas of economic and military expansionism abroad. In 2022, Beijing sponsored the first-ever Horn of Africa Peace, Good Governance, and Development Conference in the Ethiopian capital of Addis Ababa, which China’s ruling Communist Party touted as a “model country” under its $126 billion Belt and Road initiative.
G7 Summit: Africa seeks new role as nations eye its resources (BBC News)
Africa will not accept that it “should just continue to be a source of raw materials” for the rest of the world, the African Union’s Trade Commissioner has told the BBC. Albert Muchanga says instead his continent wants a future of “genuine and mutually beneficial relationships” with its trade partners.
It comes as the AU’s chair has been invited to the G7 summit in Japan amid intensifying competition with China for Africa’s natural resources.
Japan’s Prime Minister Fumio Kishida visited Egypt, Ghana, Kenya and Mozambique at the start of this month as he sought to bolster African support for his efforts to counter Chinese and Russian influence on the continent, as well as in regards to Taiwan and Ukraine.
Speaking in Maputo on 4 May he said: “Many countries of the so-called Global South are hurt and suffering from high food and energy prices. The cause of this issue should be traced to Russia’s invasion of Ukraine.”
Mr Muchanga welcomes the recognition of Africa’s problems. He says the disruption caused by the Covid pandemic is also to blame for problems that are “multi-dimensional”.
Global economy news
State and Trends of Carbon Pricing 2023 (World Bank)
Direct carbon pricing instruments, key policy to decarbonization, now cover almost a quarter of global greenhouse gas emissions, according to a new World Bank report. This is despite the challenging context for governments facing high inflation, fiscal pressures, and energy crises.
“Carbon pricing can be an effective way to incorporate the costs of climate change into economic decision making, thereby incentivizing climate action.” said Jennifer Sara, Global Director for Climate Change at the World Bank. “The good news from this report is that even in difficult economic times, governments are prioritizing direct carbon pricing policies to reduce emissions. But to really drive change at the scale needed, we will need to see big advances both in terms of coverage and price.”
How markets and consumers can drive sustainability (UNCTAD)
Ensuring responsible consumption and production patterns – as outlined in the UN Sustainable Development Goal 12 – requires minimizing environmental impacts, enhancing resource efficiency and reducing waste. In this regard, experts point out that competition and consumer protection policies are uniquely placed to help.
“Competition and consumer protection policies are conducive to improving the efficiency and fairness of markets and are therefore well placed to serve public policy goals,” said Teresa Moreira, head of competition and consumer policies at UNCTAD, while opening a high-level session of the UN Trade Forum 2023 on 9 May.
Their conversations revolved around a new UNCTAD report, which examines connections among sustainability, consumer protection and competition policies.
What women in developing countries need to thrive in e-commerce (UNCTAD)
To make e-commerce a greater driver of shared prosperity, the world must urgently tackle the challenges facing women small business owners in developing countries. That was the message from experts at a meeting held during the UN Trade Forum 2023 on 9 May, where UNCTAD launched a new policy review of e-commerce through a gender lens.
The policy review examines the opportunities for women – particularly those living in developing countries – to harness digital trade for economic empowerment, and the challenges they face.
The report cautions that the shift to digitalization, if not strategically managed, can reinforce pre-existing development and socioeconomic inequalities. It urges stronger policy action to create enabling conditions for all.
“Overcoming existing North−South disparities and addressing gender inequalities in society and the economy is vital, if e-commerce is to support the achievement of the Sustainable Development Goals,” said Simonetta Zarrilli, head of UNCTAD’s trade, gender and development programme.
All OECD countries need to step up efforts to boost gender equality (OECD)
Despite progress in recent years, more work needs to be done, across all OECD countries, to secure gender equality, with women and girls still facing inappropriate disadvantages and barriers in most spheres of social and economic life, according to a new OECD report.
The report Joining Forces for Gender Equality: What is Holding us Back? shows progress in some policy areas, such as paternity leave, pay transparency, flexible work opportunities and higher representation of women in leadership roles. However, major challenges remain, including the need to boost girls’ participation in educational fields promising better job opportunities, lower wages for women than men, barriers to entrepreneurship and self-employment for women, gender gaps in lifetime earnings and pension income, women’s disproportionate share of unpaid care and housework and women’s underrepresentation in politics and government leadership positions.
International trade statistics: trends in first quarter 2023 (OECD)
Following two consecutive quarters of decline, G20 merchandise exports rebounded in value terms in Q1 2023, as measured in current US dollars (Figure 1 and 2). Compared to Q4 2022, exports increased by 2.2%, driven partly by the revival of economic activity in China. G20 merchandise imports contracted by 1.2%, largely reflecting easing energy prices. Growth in G20 services exports and imports are estimated at around 2.4% and 4.9% in Q1 2023, respectively, compared to the previous quarter and measured in current US dollars.
E-commerce negotiations maintain positive momentum, focus on key issues (WTO)
In his opening remarks, Ambassador George Mina encouraged WTO members to lift the rate of progress in the work of the small groups so that more articles can be “parked”. He underlined the importance of the e-commerce negotiations for the future of rulemaking and the digital economy.
Ambassador Kazuyuki Yamazaki urged members to achieve as much convergence as possible in the small groups before the summer break and asked members to show the necessary flexibility.
On the development aspect of the negotiations, Ambassador Yamazaki said: “We are seeking a balanced and inclusive outcome.” He noted that members should consider how they could achieve outcomes that are beneficial to both developing and developed members so that all participating members can benefit from e-commerce in an exclusive manner.
Members, partner organizations stress importance of boosting Aid for Trade disbursements (WTO)
The Organisation for Economic Co-operation and Development (OECD) reported to the Committee that preliminary data it collected showed total Aid-for-Trade disbursements suffered a year-on-year fall of 4.7 per cent in real terms in 2021 for a total of USD 47.7 billion, a decline mainly due to inflation.
Nearly all the disbursed amounts (97 per cent) went towards building productive capacity and economic infrastructure, with Africa receiving 40 per cent of this assistance. In terms of project commitments, the decline in 2021 was 22 per cent. The OECD described this as significant compared to the substantial growth in commitments registered in previous years. The OECD added that it expects to find further fluctuations in Aid-for-Trade flows in 2022 due to the impact of the war in Ukraine.
The Least-Developed Countries Group of WTO members also noted a drop in Aid-for-Trade disbursements to its members and other low-income countries, from USD 15.6 billion in 2020 to USD 13.5 billion in 2021, which it said was regrettable.
Other news from the WTO
Cotton meetings urge progress before MC13, discuss World Cotton Day 2023, FIFA-WTO work
Members share customs valuation experiences and practices since start of the pandemic
Members advance work on online notification portal, import licensing database
WTO members review ways to facilitate digital trade and electronic transactions
International organizations launch platform to promote access to subsidy information
New report looks at WTO technical assistance activities in post-pandemic era
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Eswatini has shown resilience to multiple economic shocks. Real GDP contracted by a comparatively modest 1.6 percent in 2020 but surged by 7.9 percent in 2021 as manufacturing rebounded on the easing of COVID-19 restrictions and strengthened external demand. Real GDP growth declined in 2022 due in part to base effects but also as construction projects slowed in response to government cash constraints, and sugar cultivation and processing were affected by excessive rainfall, high fertilizer and pesticide costs, and arson. Inflation rose in the wake of surging international food and fuel prices but appears to have peaked in 2022.
The trade balance worsened in 2022 with the rising cost of food and fuel imports—driving the external current account into deficit for the first time in over ten years. Together lower SACU receipts and weakening foreign direct investment, central bank foreign exchange reserves fell to about $449 million by end-2022 (2.3 months of import cover). The external position is assessed as broadly in line with the level implied by economic fundamentals and desirable policies.
Uganda, DRC Plan to Share Oil and Gas Infrastructure (ChimpReports)
Uganda is seeking regional partnerships in the development of its multi-billion dollar oil and gas sector, the Energy Minister Ruth Nankabirwa has revealed.
“In developing the oil and gas project, Uganda has adopted a regional outlook, taking into account what the region can achieve by working together,” said Nankabirwa on Tuesday during the 10th East African Petroleum Conference and Exhibition in Kampala.
“Uganda has extended invitations to the EAC Partner States to join in the development of the refinery which will go a long way in guaranteeing petroleum products security for the region,” she added.
Malawi takes critical step towards the validation of a successor Industrial Policy (UNECA)
“Industrialisation is central to the Government agenda of structural transformation of the economy. It is envisaged that industrialisation will transform Malawi from a predominantly consuming and importing country to a predominantly producing and exporting country, thereby reducing the overriding trade deficit” says Ms. Sphiwe Mauwa, Director of Administration, Ministry of Trade and Industry (MoTI).
Ms. Olayinka Bandele, Chief, Inclusive Industrialization ECA, speaking on behalf of ECA SRO-SA Director, said that this important step Malawi is taking is vital as it plays a pivotal role in driving economic growth, promoting diversification, generating employment, adding value to exports, fostering technology transfer and innovation, facilitating regional integration, advancing sustainable development, and improving social welfare.
Republic of Chad: IMF Staff Completes the 2023 Article IV Consultation (IMF)
Economic policy discussions focused on measures to strengthen public finances. Staff noted the progress achieved in domestic revenue mobilization, which will need to continue. It also called for a better control and increased efficiency of budget spending, in particular of the wage bill, and for a prioritization of social expenditures. It is also important that budgetary procedures are followed more rigorously and that the use of emergency expenditure procedures (DAOs) is limited to emergencies. Given the high volatility of oil prices, it is also necessary that part of the oil revenues is used to rebuild liquidity reserves and reduce the stock of expensive treasury securities.
How Naira redesign and its aftermath affect free trade in Nigeria (Businessday)
During the first quarter of 2023, Nigerians experienced cash circulation shortages due to the naira redesign policy. This policy negatively impacted several informal sector businesses, such as local retail shops, artisans, and commercial bus drivers.
Trading activities for small-scale manufacturers were also affected. The impacts of the naira redesign policy show a need to revive the cashless policy for small businesses to address cash scarcity. Promoting strategic monetary approaches that complement the naira redesign policy will boost free trade in Nigeria.
The rejection of old notes by banks, motorists, and other traders caused significant challenges for Nigeria’s informal economy. Also, the country’s high percentage of unbanked individuals underscores financial inclusion.
The implementation of the naira redesign policy also revealed Nigeria’s economic vulnerability. Due to limited access to physical cash, many Nigerians could not pay for basic needs and engage in trading activities. Some bank customers closed their bank accounts in protest of the cash crunch. The CBN must address financial access and reduce reliance on physical cash.
First Tanzanian gets certificate of origin to trade on AfCFTA (The Citizen)
The first Tanzanian received a certificate of origin yesterday to trade in the African Continental Free Trade Area (AfCFTA). Presenting the certificate yesterday, the acting vice president of the Tanzania Chamber of Commerce, Industries, and Agriculture (TCCIA), Mr Vicent Minja said the certificate will allow the businessman to get a reduction in customs duty from 35 percent to 12 percent.
“We have been educating traders about the benefits of exporting goods using certificates of origin under the African Continental Free Trade Area agreement, and today we handed over the certificate of origin to the first trader,” said Mr Minja.
Mr Minja urged more businessmen to take advantage of the opportunities available in the free market by accessing certificates of origin.
EA business body calls for empowerment of women, youth in AfCFTA implementation (News Ghana)
The East African Business Council (EABC) has called for the empowerment of women and youth in the implementation of the African Continental Free Trade Area (AfCFTA), the business body said in a statement on Monday.
EABC chief executive officer John Bosco Kalisa said in the statement that the AfCFTA agreement has stepped up to ensure the full inclusion of women and youth who are key components of small and medium enterprises (SMEs).
The statement said Kalisa made the remarks during the East African Civil Society Summit that was held in Tanzania’s northern city of Arusha on May 3-5.
He encouraged women and youth entrepreneurs to utilize digital tools available to take part in regional and continental trade and called for capacity-building and sharing of information, and elimination of VAT in digital tools and platforms to empower women and youth to engage in cross-border trade.
Agoa jobs in Kenya at 66,000 ahead of trade pact expiry (Business Daily)
The number of jobs created by the two-decade-old Growth and Opportunity Act (Agoa) agreement between Kenya and America has hit 66,260 ahead of the expiry of the trade deal.
The latest data shows the value of apparels exported from Kenya via Export Processing Zones (EPZ) under the pact hit a new high of Sh54.1 billion last year, translating to a 10.8 percent rise from the Sh41.6 billion realised in 2018.
The Kenya National Bureau of Statistics (KNBS) during the 12 months to December last year also show that capital investments injected in the sub-sector increased to Sh24.9 billion from Sh16.1 billion in 2018 with the number of employees engaged rising to 66,260 up from 46,248 half a decade ago.
Kenyan manufacturers through their lobby association had in March appealed to the Trade ministry to forward a request to the Joe Biden-led administration seeking an extension of the deal for another 15 years arguing that uncertainty in its fate was costing the country billions of shillings in potential investments.
In a time of energy transition and rising demand for metals and minerals, resource-rich governments in Sub-Saharan Africa have an opportunity to better leverage their resources to finance their public programs, diversify their economy, and expand energy access.
Africa’s Resource Future, a World Bank report launched today, finds that on average countries capture only about 40% of the revenue they could potentially collect from natural resources. In other words, at a time when countries are burdened by slow growth and high debt, governments could more than double revenues from natural resources such as minerals, oil, and gas by adopting a better set of policies, implementing reforms, and investing in better fiscal administration and promoting good governance. Full taxation of natural resources is also important to charge the full cost of environmental and social impacts not always fully covered by producers, including petroleum resources. Failing to do so can act as an implicit production subsidy and raise carbon emissions.
“Maximizing government revenues in the form of royalties and taxes paid by private natural resource industries, alongside attracting new investment, would offer a double dividend for people and planet by increasing fiscal space and removing implicit production subsidies,” said James Cust, Senior Economist in the World Bank Africa Region and co-editor of the report. The prospect of higher revenues is particularly welcome in countries that find themselves unable to make badly needed development investments because of high borrowing and debt service costs.
IMO, AAMA regret non-inclusion of maritime in national devt action plans (The Guardian Nigeria)
The International Maritime Organisation (IMO) and the Association of African Maritime Administrations (AAMA) have decried the non-inclusion of the maritime industry in African countries’ national development action plans.
According to the organisations, this has posed a huge barrier to investing in projects such as green ports and national single window systems, which are key in cutting carbon emissions for the shipping sector.
AAMA also contended that the lack of defined maritime policies is locking out some African ports from accessing climate resilience financing from multilateral lenders.
According to a study by the United Nations Economic Commission for Africa (UNECA), Africa requires 126 vessels for bulk cargo and 15 boxships by 2030 for full implementation of the African Continental Free Trade Area (AfCFTA). They noted that if business remains as usual, the existing carrying capacity of African vessels would only handle less than 10 per cent of the cargo shipped in and out of the continent.
Africa needs $700bn of finance for green energy and metals (Engineering News)
Africa will need more than $700-billion in finance over the next decade to develop renewable power and mines to extract the metals required for the green energy transition, according to Standard Bank Group.
The continent’s financial institutions won’t be able to provide even half of that and most of the money will need to come from investors from elsewhere, Kenny Fihla, chief executive officer of Standard Bank’s corporate and investment banking unit, said.
African governments are under pressure to extend power supply to the 600-million people — about half of the continent’s population — who currently don’t have access to electricity. At the same time, copper and cobalt deposits in the Democratic Republic of Congo and Zambia, lithium reserves in Zimbabwe and platinum and manganese seams in South Africa are seen as key to providing the materials needed for everything from solar panels to electric vehicle batteries.
Japanese investors say they want more business with Africa (AfDB)
There is growing interest in Japan by the government, parliamentarians, mega companies and startups to invest more in Africa.
One of the largest investors in Africa, Mitsui & co Ltd, announced plans to resume the construction of the multibillion-dollar Mozambique LNG project which was stopped in 2021 following an insurgent attack on the facility in the country’s northern region of Cabo Delgado.
Toyota Tshusho Corporation is one of the front-runners among Japanese companies doing business in Africa. It is present in all 54 countries with businesses covering automobile, pharmaceutical, beverages and energy. Across the continent it employs about 22,000 people.
The company is present in 11 countries in Africa: Algeria, Cote d’Ivoire, Egypt, Ethiopia, Kenya, Morocco, Nigeria, Senegal, South Africa. Tanzania and Tunisia. Since entering the African market in 1954, Mitsubishi Corporation has spread its investment wings mineral and metal resources, automotive & mobility, natural gas, food industry and power solutions.
It’s Senior Vice President Tetsuya Shinohara, said the company had limited activities on the continent. “Africa is a tough region,” he said, “We are figuring out areas to invest in, in the future. We are asking for suggestions about the way to follow.”
EU’s CBAM could have concerning economic outcomes for Africa (ESI-Africa)
A newly released study on the implications of the European Union’s Carbon Border Adjustment Mechanism (CBAM) raises concern about the economic ramifications of the mechanism as it will hit the competitiveness of African exports.
The study, released by the African Climate Foundation (AFC) and the Firoz Lalji Institute for Africa at the London School of Economics and Political Science (LSE), says this is of particular concern for industrial exports if product coverage expands over time.
Given the impact of the CBAM on Africa, African-led measures to tackle the negative impact on trade and industrialisation measures will increasingly become pressing.
The report, Implications for African countries of a Carbon Border Adjustment Mechanism in the EU, also notes that the mechanism process will introduce administrative hurdles to market access by African countries, which historically struggle to access the European market.
China’s Hunan reports robust foreign trade growth with Africa in Q1 (China Daily)
Central China’s Hunan province registered robust foreign trade growth with African countries in the first three months of the year, with the trading volume reaching 14.47 billion yuan ($2 billion), according to the customs of the provincial capital Changsha.
The figure represented a leap of 82.9 percent year-on-year. Hunan is the long-term host of the China-Africa Economic and Trade Expo. The third session of the expo, scheduled in June, is expected to further promote the growth of bilateral trade.
In the first quarter, Hunan’s exports to Africa reached 11.19 billion yuan, an increase of 131.2 percent year-on-year, and the imports surged 6.8 percent to hit 3.28 billion yuan.
Hunan’s foreign trade with South Africa accounted for 19.1 percent of the province’s total trade with Africa in the first quarter, which was 2.77 billion yuan, an increase of 8.3 percent year-on-year.
Logistics plays major role in international trade says World Bank (The Africa Logistics)
The World Bank has released its 2023 Logistics Performance Index report, a measure of countries’ ability to move goods across borders with speed and reliability.
“Logistics are the lifeblood of international trade, and trade in turn is a powerful force for economic growth and poverty reduction,” said Mona Haddad, Global Director for Trade, Investment, and Competitiveness at the World Bank. “The Logistics Performance Index helps developing countries identify where improvements can be made to boost competitiveness.”
On average across all potential trade routes, 44 days elapse from the time a container enters the port of the exporting country until it leaves the destination port, with a standard deviation of 10.5 days. That span represents 60 percent of the time it takes to trade goods internationally.
According to LPI 2023, end-to-end supply chain digitalization, especially in emerging economies, is allowing countries to shorten port delays by up to 70% compared to those in developed countries. Moreover, demand for green logistics is rising, with 75 percent of shippers looking for environmentally friendly options when exporting to high income countries.
“While most time is spent in shipping, the biggest delays occur at seaports, airports, and multimodal facilities. Policies targeting these facilities can help improve reliability,” said Christina Wiederer, Senior Economist with the World Bank Group’s Macroeconomics, Trade & Investment Global Practice and the report’s co-author.
South Africa Urges Careful Debate on Option of Introducing BRICS Common Currency (Bloomberg)
The BRICS group of nations will discuss the feasibility of introducing a common currency and shouldn’t rush any decision, according to South Africa’s foreign minister.
US interest-rate hikes and geopolitical conflicts have pushed up the value of the American currency and all the commodities priced in it, to the detriment of most emerging markets. That’s spurred calls for alternatives to using the greenback as the global trading currency and one option that’s been flighted is for the BRICS bloc — which comprises Brazil, Russia, India, China and South Africa — to adopt their own unit. The issue is likely be on the agenda of an Aug. 22 summit of its leaders in Johannesburg.
Employment and Labour on second BRICS Employment Working Group meeting (South African Government)
There was a pressing need for BRICS countries to trade more with each other than with the rest of the world, a meeting was told at the second Employment Working Group (EWG) in Port Alfred on Wednesday.
Mr Jens Dyring Christensen, Senior Specialist: Enterprise Development and Management at the International Labour Organisation (ILO), was speaking on the topic: BRICS Productivity Ecosystems.
“What we find is that trade with the United States is six times higher that within BRICS member states. What is needed is to expand inter-BRICS trade,” he said.
“If BRICS countries trade more among themselves it will boost economic growth among member states. They could do this by identifying within their countries where there is mutual interest such as beef,” he said.
UNCTAD calls for balanced global approach to manage digital data (UNCTAD)
UNCTAD Secretary-General Rebeca Grynspan has reiterated the organization’s call for a more balanced approach to global data governance for the benefit of people and the planet.
The world currently has a global data governance system split in three, with some countries relying on the private sector for data management, others on citizens and others on the state itself. Ms. Grynspan said global efforts towards a more balanced approach should “enable data to flow as freely as necessary and possible, while being able to address various development objectives.”
To ensure an inclusive process with representation of all developing countries, she said the United Nations needs to play a key role in the process, which should be “multilateral, multisectoral and multi-stakeholder.”
“And these are still early days in the data-driven digital economy,” she said. With the spread of 5G, the growing number of Internet of Things devices and greater use of artificial intelligence (AI), data and data flows will continue expanding rapidly.
But as captured by UNCTAD’s latest Digital Economy Report, data flows are deepening already existing digital divides.
Many developing countries remain mostly providers of raw data to global digital platforms, while having to pay for the digital intelligence generated from their data.
DDG Paugam urges ministers to harness WTO potential for advancing agricultural innovation (WTO)
The WTO offers a very good framework to support innovation in sustainable agriculture. We manage a trade policy toolbox that can be leveraged to foster innovation worldwide.
The first tool is creating and enhancing access to the global market: It is the most classical one of them all: tariffs. Decreasing tariffs is directly relevant to enhancing access to technology, accelerating the dissemination of innovation, and achieving economies of scale that would incentivise investment. And this is not just theoretical. We know that we have a global problem of disconnect between tariffs and the climate: several research studies show that tariffs are biased in favour of carbon intensive products, meaning they are lower for “brown” products and technologies as compared to “green” products and technologies. Take alternatives to plastics for example: they are usually taxed with higher tariffs. The reason for that, of course, is that they are derived from agricultural products which are themselves taxed higher. So, decreasing tariffs is the first thing to consider when thinking about how trade can help.
The second tool is about finance.
The third tool is about regulation.
But overall, we lack consensus on all these issues at the WTO. One of the main reasons is that we have so much unfinished business from the past, including trade distorting domestic subsidies. And this has prevented our members from tackling the critical issues impacting agriculture today and into the future — such as climate change and climate smart agriculture.
Today we have one emerging topic that could help us bridge the gap and that is food security: food security is obviously at the heart of the conundrum between production, trade, and climate change. The United States amongst other recently presented an interesting contribution to the WTO on that topic. So, I hope that it may build the needed bridge between the past and the future. My message today to Ministers of Agriculture is, please push together with your trade counterparts for the WTO to deliver what it should be delivering in support of your climate smart agricultural policies.
Closing the ‘great finance divide’ for the SDGs (UNDP)
The Sustainable Development Goals (SDGs) are in emergency mode. Halfway to the 2030 deadline, progress is eroding before our eyes.
The overlapping food, health, energy and economic shocks of the past few years have pushed tens of millions of people into poverty.
During the pandemic, rich countries could afford to invest in recovery and got back on pre-pandemic growth paths. Their recovery spending was 30 times higher than for developing countries, and 610 times higher for least developed countries, which could only afford US$20 per person.
The global financial system has failed to protect developing countries in this time of unprecedented crises, in part because it was never designed with their interests in mind in the first place. The ‘great finance divide’ risks becoming a lasting sustainable development divergence.
With just seven years to go until the SDG deadline, the United Nations is calling for revolutionary financial and industrial transformation to meet the Goals and close the widening gaps between rich and poor. It is called the SDGs Stimulus Plan. The 2023 Financing for Sustainable Development Report lays out what it will cost and how we can get there.
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Mining explorations breach N$1.3 bln (New Era)
Exploration in 2022 continued with its upward trajectory, breaching N$1.3 billion in real terms. This was shared by the Chamber of Mines 2022 report, shared by Hilifa Mbako as the outgoing president.
Mbako, during the chamber’s annual general meeting on Wednesday, added that after many interruptions and delays during Covid-19, the chamber was able to provide their input in the Minerals Bill.
The mining sector continued to uphold its commitment to supporting local suppliers and spend approximately N$16.823 billion on goods and services from Namibian registered businesses. As a proportion of total procurement spent by the sector, 74% was spent on local businesses.
SA agri products gain foothold abroad (SAnews)
Agriculture, Land Reform and Rural Development Minister, Thoko Didiza, says efforts to improve market access for South African products on the international markets are bearing fruit.
Presenting the department’s R17 254 348 billion budget for the 2023/2024 financial year on Tuesday, Didiza said in June 2022, the country signed the Protocol of Phytosanitary Requirements for the export of soybean from South Africa to China.
In August last year, SA also successfully negotiated the lifting of a ban on South Africa’s wool and other cloven-hoofed animals’ skin products with China.
SITA looking to bolster digitalisation of borders, travel in Africa (Engineering News)
Border management agency SITA sees considerable potential for South Africa and Africa to leapfrog legacy deployments and adopt digital solutions at borders to streamline travel and transport in the region; however, there are some constraints as it looks to engender this.
This was indicated by SITA government and industry relations director Andy Smith, speaking during a SITA borders management media briefing and roundtable discussion, in Johannesburg, on May 9.
Smith indicated that efforts to deepen the company’s reach in the region came as flagship initiatives in the region progressed, including the Africa Continental Free Trade Area (AfCFTA) and the Free Movement of Persons Protocol.
In terms of the former, Smith outlined that this presented an opportunity to reach upwards of two-billion consumers. Moreover, AfCFTA was projected to lead to a 25%, or $36-billion, growth in intra-Africa trade between now and 2040.
Moreover, Smith said that there was also an opportunity to increase intra-African travel and cargo, with this openness of free movement to be grounded in security.
“The only way we’re going to do that is through digitalisation and technology. Technology can help sway the process, it can help combat certain elements of corruption, which is obviously a challenge of certain borders as well. We’re excited to work with Africa on this,” he highlighted.
Imports from China, India surge as cash-strapped consumers seek cheaper cars (Engineering News)
The domestic new-vehicle market saw a surge in imports from India and China last year, with buyers increasingly opting for cheaper imported cars than those made in South Africa. India led the import market in 2019, with 106 000 units coming to South Africa, with China at number six, at 11 443 units.
Nine of the biggest-selling cars and light commercial vehicles in South Africa were made locally in 2019.
The newly released 2023 Automotive Export Manual, published by the Automotive Industry Export Council (AIEC), shows that imports from India surged to 165 910 units last year, ensuring it remains in the top spot as South Africa‘s biggest vehicle import market by volume.
The FDI landscape in Kenya in 2023 (Investment Monitor)
Over the past few years, Kenya’s foreign direct investment (FDI) landscape has been darkened by the inauspicious clouds of Covid-19, political unrest, uncompetitive returns and comparatively high perceived levels of public sector corruption. More recently there have been reports of nationwide protests and demonstrations, led by former Prime Minister and Leader of the Opposition Raila Odinga, which have disrupted the country’s economy and caused social unrest. Spurred by mounting frustrations about the high cost of living and poor employment prospects, and fortified by a historic distrust of the country’s democratic institutions, Odinga has alleged that Kenya’s general election in August 2022 – in which he was narrowly beaten by President William Ruto – was blighted by irregularities.
The country’s dwindling FDI profile appears to reflect its unstable political and economic climate. According to UNCTAD’s Investment Report 2022, between 2019 and 2021, Kenya’s flow of inward FDI decreased year on year from $1.1bn (Ks150.36bn) in 2019 to $717m in 2020 to $448m in 2021, continuing a general pattern of decline since 2010. The number of greenfield investments also shrunk by nearly 60% over the same three-year period, from 95 in 2019 to 39 in 2021. This decline in foreign investment deals bucks a trend seen elsewhere in east Africa, where average FDI inflows increased by 35% between 2019 and 2021, to a total of $8.2bn.
Value of Kenya exports to Tanzania tops EAC growth (The Citizen)
Kenya’s total exports to Tanzania posted the biggest growth among all East Africa Community(EAC) destinations in terms of absolute value last year, underlining the gains of a reset in the relations between the two countries.
Data by the newly released Economic Survey 2023 shows that Kenya exported goods worth TSh1.14 tillion to Tanzania last year compared to TSh911 billion in 2021— a Sh236 billion jump which was the highest among all other EAC destinations.
“Exports to Tanzania grew by 25.9 percent to TSh1.14 trillion in 2022 on account of increased exports of iron and non-alloy steel,” the survey said.
Kenyan manufacturers had in recent years protested “discriminative” duties and non-tariff barriers such as double inspection of goods for standards by Tanzania, which had made supplies such as meat, milk, and related products to the neighbouring country uncompetitive.
Kenya’s sugar retail prices remain high despite duty-free imports (The East African)
Duty-free sugar imports, which were allowed into Kenya from January, have failed to cool off high retail prices.
Data from the Sugar Directorate indicates that the volumes imported between January and March were 93,000 tonnes against 46,000 in a similar period last year. The sharp increase in import volumes was on the back of the waiver on duty to allow the shipping of cheap commodities to address a shortage that has kept prices high.
Duty-free import of sugar is part of a wider government plan to lower the high cost of goods.
Locally, production has been inhibited by diminishing cane supply on the farms. The shortage of cane has seen millers grapple with the little available, pushing the price of a tonne of the commodity from Ksh4,584 ($33.58), which is the recommended price by the sugar directorate, to Ksh5,250 ($38.46).
The diminishing supply of cane to factories, which has cut down on production activities, saw the total sugar bagged in the review period decline by 26 percent to 49,761 tonnes. The decline in production will compel consumption due to low supply in the market.
Rwanda Horticulture Products Exhibited In Sweden (Taarifa Rwanda)
Rwanda is showcasing an assortment of made in Rwanda horticulture products at the ongoing # SWEACC23 Business & Investment Forum in Sweden.
According to NAEB, last week (Apr, 29 – May, 5) Rwanda horticulture export volume was worth 338.5MT that fetched U$ 630,636 with major destinations including; DRC, UAE, UK, Netherlands, Germany, and Nigeria.
The country is looking to expand its horticulture products export footprint through tapping in opportunities at the Swedish-East African Chamber of Commerce Business & Investment Forum in Stockholm.
Spain ready to strengthen trade with Tunisia (ZAWYA)
Spanish Secretary of State in charge of Trade, Xiana Mendez, underlined, on Monday, her country’s willingness to intensify the volume of trade between the two countries.
In a statement granted to TAP, she recalled that the volume of trade between Tunisia and Spain has recorded, in 2022, a record figure, reaching 1.9 billion euros. The objective is to exceed this volume and diversify bilateral trade, Mendez said.
The Minister stressed the importance of developing tripartite cooperation between Tunisia, Spain and the African and Maghreb markets (Libya, Algeria, and Sub-Saharan Africa).
Ben Rejeb also stressed the importance of developing cooperation relations between the two ministries in charge of trade, which can be concretized through a bilateral cooperation agreement allowing to benefit from the Spanish competencies in several fields.
Priority for Guinea: Improving the Status of Women and Girls (World Bank)
Women and girls in Guinea face significant barriers to accessing the same opportunities as men, according to a new World Bank report, Unlocking Women’s and Girls’ Potential: The Status of Women and Girls Relative to Men and Boys in Guinea”
Guinea, ranked 182 out of 191 in the United Nations Development Program’s Gender Inequality Index in 2021, is one of the most unequal countries in the world in terms of gender. The economic consequences of this inequality are all the more alarming given that almost half of the rural population remains below the poverty line.
The lack of investment in human capital increases the risks of poverty among women. Overall female labor force participation in Guinea remains below the Sub-Saharan African average, with women’s employment characterized as informal and vulnerable. Women also appear to be disadvantaged in terms of access to and ownership of productive assets and finance.
Cabo Verde: IMF Staff Completes 2023 Article IV Consultation (IMF)
“Cabo Verde’s performance under the program is solid. The economy rebounded strongly in 2022 growing 17.7 percent, the primary deficit narrowed to 1.9 percent of GDP, the debt-to-GDP ratio declined, the current account improved, and international reserves were adequate to protect the currency peg. The authorities used monetary and fiscal policy to support the recovery and cushion the impact of the crisis on the most vulnerable.
“Real GDP growth is projected to moderate to 4.4 percent in 2023 as export growth normalizes. Inflation is projected at 5.2 percent in 2023, as fuel and food prices decline. The current account deficit is expected to widen in 2023 as exports of goods and services, tourism, remittances, and foreign direct investment slowdown from levels recorded in 2022.
“Despite the challenging global economic environment, Cabo Verde continues to make good progress in its objective to protect vulnerable groups and foster higher and inclusive growth.”
Reform needed to fund biodiversity in developing nations (SAnews)
Minister of Forestry, Fisheries and the Environment, Barbara Creecy has called for significant reform of the global financial system and of multilateral development banks to fund developing countries’ biodiversity and climate change initiatives.
Addressing the 5th Global Conference on Biodiversity Finance in Cape Town, the Minister said South Africa’s biodiversity is not only a national and cultural asset but is also a source of economic prosperity through the sustainable use of a wide variety of plants and wildlife.
“Mechanisms such as debt for biodiversity swaps, payment for ecosystem services, as well as greater availability of grant financing and concessional loans must be considered in the context of achieving sustainable financing mechanisms for developing countries. Neither our biodiversity nor our climate change objectives can be achieved by Global Environmental Facility (GEF) funding or by further loans to developing countries, the majority of which are already heavily indebted,” Creecy said on Tuesday.
According to research conducted in 2017 (and updated in 2022), some of the many ecosystem services provided by natural ecosystems in South Africa could be valued at R275 billion per year (R325 billion in 2022).
African Trade And Investment (Africa.com)
Africa is gearing up for a new era of trade and investment, with a focus on collaboration, creativity, and the digital economy. Representatives from three World Trade Center (WTC) locations including WTC Cairo, WTC Addis Ababa, and WTC Abuja, highlight the trade prospects and challenges facing Egypt, Ethiopia, and Nigeria in 2023.
Mr. Farag El Mahrouky, Head of Marketing and Customer Service Department at WTC Cairo points out that Egypt is looking to focus on collaboration and communications in 2023, with a keen emphasis on improving trade services.
At the end of 2022, Egypt successfully concluded its first trade agreement under the African Continental Free Trade Agreement (AfCFTA), thanks to a collective effort by stakeholders to eliminate export barriers. This landmark deal facilitated the export of food products from Egypt to Ghana and laid the foundation for future trade exchange activities in the region.
As a signatory of the AfCFTA, Mr. Rateneh Fassil, CEO and Managing Director of WTC Addis Ababa, sees the continued growth of regional and continental trade integration as a major opportunity for growth and recovery, especially in the areas of infrastructure, education, and health.
He points out that the story of abundant opportunities for growth, prosperity, and decreased trade deficit is not obvious when looking at the current number of intra-African trade dwindling at only 14%. However, the comparative advantages of the various economies across the borderless AfCFTA market bodes well for this story to be developed.
According to Ms. Wuraola Onigbogi, Trade Services Manager at WTC Abuja, Nigeria is taking a holistic approach to 2023, recognising the importance of creativity, digital trade, and maintaining relationships with clients.
The country’s revised 2023-2027 trade policy places a strong emphasis on e-commerce and digital payments, and Nigeria is eager to take advantage of the increased access to cheaper goods and services offered by the AfCFTA.
Afreximbank has to leverage AfCFTA to transform Africa by 2050 – Moghalu (TheNiche)
Former Deputy Governor of the Central Bank of Nigeria (CBN), Prof Kingsley Moghalu, has said that the African Export-Import Bank (Afreximbank) must zero in on the various aspects of the African Continental Free Trade Area (AFCFTA) so that, combined with its role and operations, it can bring about the needed continental transformation by 2050.
He described the establishment of AFCFTA by member states of the African Union as “a watershed development in Africa’s contemporary and future positioning in world trade.” Moghalu noted that going forward he believes the continental trade agreement would provide an enabling environment for the work of Afreximbank that would be far more powerful than was the case in the past 30 years of the bank, without prejudice to the bank’s significant achievements.
National consultations for the drafting of the Constitution of the East African Community (EAC) Political Confederation resumed in Mombasa, Kenya with the launch of 20-day long public hearing sessions across the country.
Speaking at the launch, the Cabinet Secretary for East African Community, Arid and Semi-Arid Lands and Regional Development, Ms. Rebecca Miano, said that national stakeholders’ consultations on the Political Confederation was a crucial engagement in the context of the Community’s efforts towards promoting popular participation, which in turn, will inform the policy decision to be made.
South-South trade agreement holds key to more sustainable and inclusive growth (UNCTAD)
At the end of 2022, Brazil ratified commitments under the Global System of Trade Preferences among Developing Countries (GSTP), rekindling international interest in the trade agreement, now just one ratification away from entering into force. The GSTP’s 42 members from Africa, Asia and Latin America are home to 4 billion people and represent a combined market of $16 trillion – about 20% of global merchandise imports.
“There is now a window of opportunity for the GSTP,” UNCTAD Deputy Secretary-General Pedro Manuel Moreno said on 8 May at the opening session of the UN Trade Forum 2023, which focused on the agreement.
The GSTP promotes trade among developing countries – also known as South-South trade – by cutting tariffs on the goods they import from each other. Such cuts reduce a product’s final price for consumers, making it more competitive. UNCTAD estimates that if GSTP members implement the tariff cut commitments of the latest round of negotiations – known as the “São Paulo Round Protocol” – they could boost their collective prosperity by about $14 billion.
“South-South trade – for a long time just an aspiration – has become one of the main forces responsible for growth and development over the last two decades,” said Rubens Ricupero, a Brazilian economist and former UNCTAD secretary-general.
Trade between developing countries has increased by an average annual rate of 9.8% since 2000, hitting $5.3 trillion in 2021. During the same period, world trade grew at a slower 5.5%. Mr. Moreno highlighted that strong results were also seen for products with high added value. In 2021, he said, South-South trade accounted for nearly 60% of developing countries’ high-tech exports.
European Parliament supports duty-free trade with Ukraine for another year (Ukrinform)
At a plenary session in Strasbourg, the European Parliament voted by a majority in the first reading to extend duty-free trade with Ukraine for another year, starting June 6, 2023.
The European Commission has proposed to extend trade liberalization measures for another year, starting on June 6, 2023. Such an extension of economic support for Ukraine is necessary in view of Russia’s aggression against Ukraine and the fact that in June 2022 Ukraine was granted candidate country status.
The EU further deepened the rules for trade liberalization with Ukraine under the bilateral Association Agreement and approved regulatory rules on temporary preferential trade regime on May 30, 2022. These regulatory rules entered into force on June 4, 2022, and will remain in force until June 5, 2023.
The trade liberalization measures, which were extended for another year, starting from June 6, 2023, by the European Parliament today, provide for the temporary abolition of all customs duties, in accordance with Article IV of the EU-Ukraine Association Agreement and in accordance with the rules of the Deep and Comprehensive Free Trade Area. These rules apply to two categories of products: fruits and vegetables, which are subject to the system of entry price control, and agro-industrial goods and agricultural products subject to tariff quotas.
The number of people experiencing acute food insecurity and requiring urgent food, nutrition and livelihood assistance increased for the fourth consecutive year in 2022, with over a quarter of a billion facing acute hunger and people in seven countries on the brink of starvation, according to the latest Global Report on Food Crises (GRFC).
The report finds that around 258 million people in 58 countries and territories faced acute food insecurity at crisis or worse levels (IPC/CH Phase 3-5) in 2022, up from 193 million people in 53 countries and territories in 2021. This is the highest number in the seven-year history of the report. However, much of this growth reflects an increase in the population analysed. In 2022, the severity of acute food insecurity increased to 22.7 percent, from 21.3 percent in 2021, but remains unacceptably high and underscores a deteriorating trend in global acute food insecurity.
Economic shocks have surpassed conflict as the primary driver of acute food insecurity and malnutrition in several major food crises. Cumulative global economic shocks, including soaring food prices and severe disruptions to markets, undermine countries’ resilience and capacity to respond to food shocks.
The measure of world food prices rose in April for first time in a year (FAO)
The benchmark index of international food commodity prices rose in April for the first time in a year, amid increases in world quotations for sugar, meat and rice, the Food and Agriculture Organization of the United Nations (FAO) reported today.
The FAO Food Price Index, which tracks monthly changes in the international prices of commonly-traded food commodities, averaged 127.2 points in April 2023, up 0.6 percent from March. At that level, the Index was 19.7 percent below its level in April 2022, but still 5.2 percent higher than in April 2021.
“It is important that we continue to track very closely the evolution of prices and the reasons for increases in prices. As economies recover from significant slowdowns, demand will increase, exerting upward pressure on food prices,” said FAO Chief Economist Maximo Torero.
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Why Nigeria must join BRICS (TheCable)
About five years ago, the Federal Government of Nigeria and China entered into a currency exchange agreement. The transaction, which was valued at Renminbi (RMB) 16 billion or N720 billion was aimed at providing adequate local currency liquidity to Nigerian and Chinese industrialists and other businesses, thereby, reducing difficulties encountered in the search for the United States Dollar. The swap was also designed to improve the speed, convenience and volume of transactions between the two countries.
While other nations are making arrangements to promote their local currencies, the federal government has continued to dollarise the Nigerian economy. Just recently, the Kenyan government signed an agreement with Saudi Aramco to supply fuel and diesel for the next six months, while Abu Dhabi National Oil Company (Adnoc) will deliver three cargoes of super petrol every month. The deal permits local oil companies to pay for oil imported on credit through a government-to-government deal in Shillings to ease pressure on the local currency. Before the deal, Kenya was paying $500 million for the importation of petroleum products per month.
Kenya seeking a 5% share of the African pharmaceuticals market (Engineering News)
Kenyan Roads and Transport Cabinet Secretary Kipchumba Murkomen has highlighted the recently announced policy of President William Ruto to make the country East Africa‘s pharmaceutical manufacturing hub by 2030, and export pharmaceuticals across the whole of the continent. Murkomen was delivering the keynote address at the ceremony for the awarding of the International Air Transport Association’s Centre of Excellence for Independent Validators Pharma certification to Kenya Airways Cargo.
Currently, the Kenyan pharmaceutical industry holds only a 30% share of the country’s domestic pharmaceuticals market, which has a total value of 100-billion shillings (about $732-million), he noted. Although Kenya exports pharmaceutics to the East Africa Community, the Common Market for Eastern and Southern Africa, and elsewhere in Africa, these exports are currently worth only 6.4-billion shillings (a little under $47-million).
South Africa: Increased quota for United States frozen bone-in chicken (Global Compliance News)
The annual quota for frozen bone-in cuts of the species Gallus Domesticus originating in, or imported from, the United States (US) has been increased from 71,290 tonnes to 71,632 tonnes, with retrospective effect from 1 April 2022.
The decision to again increase the quota of frozen chicken that is allowed to be imported into South Africa from the US may be seen by some to be a compromise that must be made for South Africa to continue to benefit from the African Growth and Opportunity Act (AGOA) program.
However, it will hopefully also assist in bringing the price of chicken down for poverty-stricken households. It is also hoped that the South African Customs Union, and South Africa in particular, will soon be able to conclude a reciprocal, mutually beneficial trade agreement with the US that further addresses the challenges around this issue, especially considering that AGOA’s preferential stipulations are set to expire again in 2025.
Tanzania’s coal exports rise seven-fold to hit $224m (The East African)
Europe’s energy crisis caused by the invasion of Ukraine by Russia has seen Tanzania coal exports record seven-fold jump in the year to March due to high demand, latest central bank data shows.
Tanzania, which has 1.9 billion coal reserves of which 25 percent are proven, saw its exports of the fossil fuel surge to $223.8 million.
“Exports of coal edged up to $223.8 million from $31.9 million, induced by rising demand for alternative energy, amid supply challenges caused by the war in Ukraine,” the Bank of Tanzania (BoT) says in its Monthly Economic Review for April 2023.
The resurgent coal demand has also seen the once sleepy port of Mtwara enjoying unprecedented operations and government collecting sizeable revenues from the exports.
RwandaAir launches new African hub with Qatar Airways Cargo, Cargo Hub (International Airport Review)
The new Kigali Cargo Hub is part of a long-term strategic plan for the cargo division of RwandAir, which has seen cargo carried rise by nearly 26% in the last five years. The initiative will help RwandAir develop Kigali into a regional cargo powerhouse, boosting exports and imports around Africa and strengthening links with key overseas markets.
The partnership saw Qatar Aviation Services (QAS) provide consultancy support to RwandAir Cargo to help improve its already highly successful cargo handling performance.
Yvonne Makolo, CEO of RwandAir, said: “We are very proud to partner with Qatar Airways Cargo to launch today the brand-new Kigali Cargo Hub, which will open up new cargo opportunities across Africa. ”Africa is home to a hugely diverse economy, with businesses and entrepreneurs looking for better connections to create new markets and expand inward investment. Together have created a fantastic new facility to meet this growing demand across Africa.”
With the launch of the new cargo hub, RwandAir will continue to offer customers reliable, high-quality cargo services across Africa. It is supported by the entry into service of its first dedicated freighter aircraft – a Boeing 737 – 800- and enabled the launch of new freighter services to the airline’s key destinations across Africa and the Middle East.
Report lauds Tanzania on Malabo Declaration goals (The Citizen)
Tanzania is largely on track in implementing its commitments under the Comprehensive Africa Agriculture Development Programme (CAADP), known as Malabo goals. The country scored higher points than its partners in the bloc in the benchmark on its commitment to cut by half the share of its population that is poor.
“Tanzania and Rwanda stayed on track,” said Mr Furaha Marwa, the principal agricultural economist with the East African Community (EAC). He revealed this here when he tabled a report on the performance of the seven nation bloc on the Malabo commitments aimed to enhance agricultural production. The commitments included, among others, enhancing finance in agriculture, ending hunger by 2025 and halving poverty also by 2025. The others are boosting intra-African trade, resilience to climate risks, mutual accountability and re-commitment to CAADP itself.
Allocate more funding for Agric, EAC partner states told (Tanzania Daily News)
Partner States within the East African Community (EAC) have been challenged to allocate more funds on agriculture. This is in a bid to cushion the sector from the pangs of persistent drought caused by climate change.
Speaking on the sidelines of the sixth EAC Budget Summit hosted by the Eastern and Southern Africa Small Scale Farmers Forum (ESAFF) here midweek, the forum’s chairperson Hakim Baliraine noted that it was high time the partner states started allocating sufficient budget on agriculture in the spirit of Malabo Declaration.
The Ministry of Commerce, Industry and Trade of the Kingdom of Eswatini, in collaboration with the United Nations Economic Commission for Africa (ECA) held a Validation Workshop for the Kingdom of Eswatini’s National AfCFTA Implementation Strategy on 4th May 2023.
Officiating at the meeting, the Minister of Commerce, Industry and Trade Manqoba Khumalo emphasised Eswatini’s need to develop a practical and effective strategy and action plan for the private sector, including MSMEs, “to be better positioned to take advantage of the available market access opportunities presented by the AfCFTA.”
He notes that for Eswatini, one of the objectives of the National Strategy is to leverage deeper integration within the framework of the AfCFTA to facilitate an increase of Eswatini’s trade and investment within the African continent.
Minister Khumalo: “It is also to support structural transformation and foster economic growth and sustainable development, as well as create employment opportunities for all emaSwati, particularly women and the youth, including people with disabilities with the ultimate aim of reducing poverty in the country.”
AfCFTA: Effective implementation and reforms to boost growth – IMF report (Africanews)
A successful African free trade area implementation could unlock major benefits for Africa in terms of income, jobs among other things, a report by IMF staff said.
The departmental paper published Friday (May 5) examined the prospects for African trade integration in the context of a changing world amid the climate crisis, risks of geopolitical fragmentation, technological progress, and the continent’s prospective demographic growth.
The 64-page document found that comprehensive reforms combined with the AfCFTA implementation could increase the median merchandise trade flow between African countries by 53 percent and with the rest of the world by 15%. This would consequently raise the real per capita GDP of the median African country by over 10 percent.
Financial literacy critical to success of AfCFTA – Desmond Bredu (Starr Fm)
The Head of Client Coverage at Stanbic Investment Management Services (SIMS), Desmond Bredu, has underscored the importance of financial literacy, particularly for the youth, in realizing the full benefit of the Africa Continental Free Trade Area (AfCFTA).
Speaking at the ‘Women Lead Forum’ in Accra on the topic ‘Implementing the AfCFTA, Africa’s youth as catalysts for action and its success’, Desmond Bredu said financial literacy was crucial to ensure that the Ghanaian youth are empowered to drive the growth of AfCFTA.
He mentioned that, “There is a lot of potential in our youth to do great things. They have the potential to push the AfCFTA program and create the development in Africa that we all want to see. Unfortunately, all these initiatives and projects will be meaningless to them if they do not have the requisite knowledge and skill needed to sustain and benefit from these programs. Therefore, it is imperative that we provide them with financial literacy that will help them make sense of this project and drive them to develop new and innovative ways to even make it better.”
AfCFTA State Parties currently negotiating Protocol on Digital Trade (Namibia Economist)
The Centre for the Study of the Economies of Africa provided researchers with a platform last week to discuss the findings and policy recommendations for AfCFTA State Parties to consider when negotiating potential rules on cross-border data flows.
Against the backdrop of the African Continental Free Trade Area (AfCFTA) secretariat recently announcing that the Digital Trade Protocol is expected to be concluded in July 2023, Franziska Sucker from the University of the Witwatersrand and another co-author has written a paper titled ‘Regulating cross-border data flows under the AfCFTA Protocol on Digital Trade: The what, why, how, where, and when’, which is currently undergoing peer review for publication in the Manchester Journal of International Economic Law.
It seems likely that negotiators will at least be considering whether to include rules on cross-border data flows (CBDFs) in the Protocol. The researchers’ tack is that negotiators must try to answer five key questions when negotiating rules of this kind.
Top 10 African countries with the best environment for trade (Business Insider Africa)
Some countries tend to create more favorable business ecosystems than others, and often times this single factor is the difference between an economically prosperous region and a struggling one.
While there are other economic components to becoming a thriving nation such as industrialization, exportation, and development of natural and human resources, a fail-safe economy is typically bolstered by its local and foreign direct investment.
To this effect, businesses all across the globe are in constant search of business-enabling economies, particularly in a region such as Africa which is considered the fastest-growing economy of any continent on the globe.
Africa’s largest bank, Standard Bank, recently released its Africa Trade Barometer report, where African countries are ranked based on their business ecosystem. This report is one of the most comprehensive research reports on the state of trade on the African continent as experienced on the ground by real African businesses. It offers a comparative view of the enablers and challenges to facilitating trade across 10 key African markets.
Scholz: We support African-led efforts to build trade and security (The East African)
Visiting German Chancellor Olaf Scholz spoke to Aggrey Mutambo about East Africa’s place in Berlin’s foreign policy.
Q: How can Africa boost exports to Germany and how can bilateral trade increase?
A: “Africa has some of the fastest growing economies in the world, with enormous potential for trade with Germany. Germany produces technologies that are very important for transitioning to carbon-free economies, which African countries could use to benefit from the enormous renewable energy resources that this continent has to offer also to European customers. We should see this as a win-win situation and make the most of it. In 2017 Germany initiated the G20 Compact with Africa, an investment initiative within this group of the most important economies. Kenya is most welcome to participate in this. Germany also strongly supports the African Continental Free Trade Area. This visionary project could raise incomes in Africa substantially and lift some 50 million people out of extreme poverty. Our long-term vision is a continent-to-continent free trade agreement between Africa and Europe.”
Achieving food security will require revamping our production and consumption patterns (UNECA)
In partnership with the UN Resident Coordinator’s Office in Tunisia and the ECA Office in North Africa, the UN-Habitat Office in Tunisia held a dissemination workshop on the project “Uncovering the effects of the Russo-Ukrainian war: How to anticipate and prepare for the repercussions of the Russo-Ukrainian war on food security in Tunisia?” on Thursday 4 May 2023, at the Movenpick Hotel in Tunis.
By 2050, about two-thirds of the world’s population will live in urban areas. This will lead to a distinct set of challenges and opportunities in urban development and food chains. Rapid urbanization challenges include growing vulnerability to climate change, spatial inequalities, migratory pressures and conflicts, as well as difficulties in promoting inclusive prosperity and economic development. In Tunisia, the urban population will reach 70%, hence the need to think about actions, solutions, and strategies for more sustainable, inclusive and healthy food systems that are resilient to shocks, said Aida Robbana, Director of the UN-Habitat Office in Tunisia.
African Maritime Leaders Debate their Role in Decarbonizing Shipping (The Maritime Executive)
Last week, the IMO (International Maritime Organization) and the umbrella body of African maritime regulators AAMA (Association of African Maritime Administrations) held deliberations aimed at accelerating shipping decarbonization in Africa. While green shipping is a complex matter globally, developing nations face a bigger challenge due to limited fiscal space to support maritime decarbonization.
Additionally, some African countries are yet to include the maritime industry in their national development action plans. This is a huge barrier in investing in projects such as green ports and national single window systems, which are key in cutting carbon emissions for the shipping sector.
“Maritime administrations in Africa must act as enablers to facilitate growth of the shipping industry. We must also come out in large numbers at IMO deliberations to ensure our needs are catered for at the global level,” implored Shadrack Mwandime, Kenya’s Principal Secretary for Shipping and Maritime Affairs.
“To raise intra-African trade from the current 15 percent, more cargo ought to be carried on African owned vessels. There is already enough regional cargo to support commercial operation of national and pan-African shipping lines,” highlighted Folorunso Olufunmilayo, the Secretary General of African Shipowners Association.
Inclusive growth and sustainable development in Africa: a major task for regional development banks (AfDB)
The average annual GDP (Gross Domestic Product) growth in Africa was 3.4% between 2010 and 2021, according to African Development Bank data. This is well below the targeted yearly average growth of 7%. Combined with population growth, GDP per inhabitant has barely changed.
At the same time, average purchasing power in Africa has deteriorated due to inflation, which has accelerated over the last 10 years. As well as the challenges of governance, the reality of African economies means that periods of optimism have often been disrupted by external shocks such as Covid-19, and the Russian war in Ukraine, resulting in lower GDP growth rates over the last few years.
Women’s Empowerment and Women in Power, Essential Benefit from the Fourth Industrial Revolution in Africa (African Union)
H.E. Dr Amani Abou-Zeid, African Union Commissioner for Infrastructure and Energy, highlighted the need to advocate for more women in power to participate in the fourth industrial revolution. The remark was made during the celebration of Girls in ICT at the Transform Africa Summit held from 26th -28th April 2023, in Victoria Falls, the Republic of Zimbabwe.
Noting that only 16 percent of ICT Ministers in Africa are women yet they constitute more than half of the population, they called for investment in pro-women and girls policies to empower them to take up decision making positions.
Commissioner Abou-Zeid seized the opportunity to highlight that digital literacy for girls is of high importance and it is in line with AU policy on gender mainstreaming in tech sectors. “Improving the lives and opportunities of women and girls is an explicit objective of the African Union and this is well reflected in Digital Transformation Strategy for Africa and the AU Strategy on Gender Equality and Women’s Empowerment (GEWE),” said Commissioner Abou-Zeid.
DG Okonjo-Iweala: Delivering meaningful development outcomes key to successful MC13 (WTO)
WTO Director-General Ngozi Okonjo-Iweala called on members to renew momentum in the discussions on development issues in the run-up to the 13th Ministerial Conference (MC13), to be held in Abu Dhabi in February 2024. Speaking at the General Council on 8 May, the Director-General urged members to continue efforts to build convergence and engage more in frank conversations that would allow the WTO to move forward its agenda.
DG Okonjo-Iweala reported on her recent trip to Ghana, Côte d’Ivoire and Kenya, where she addressed how to strengthen the WTO’s partnership with the region and better help African members take advantage of the opportunities offered by re-globalisation.
“The eyes of Africa are on us, specifically on special and differential treatment. … I therefore encourage you all to work hard and speed up this area of work to constructively engage in line with paragraph two of the MC12 outcome document,” she said.
Global ‘Blue Deal’ urgently needed to protect and invest in our ocean (UNCTAD)
The ocean holds vast opportunities for developing countries to build more innovative and resilient economies. But climate change, pollution and overfishing threaten those opportunities and the livelihoods of about 3 billion people who rely on the ocean for food and income.
UNCTAD’s Trade and Environment Review 2023, published on 8 May, analyzes the world’s ocean economy – worth an estimated $3-6 trillion – and assesses how human activity and multiple global crises have significantly affected different sectors, including fishing, seafood, shipping and coastal tourism.
The report, presented at the 3rd UN Trade Forum, calls for a global trade, investment and innovation “Blue Deal” to sustainably use our ocean, home to 80% of all life. It builds on the recommendations from the 4th UN Oceans Forum and the 2nd UN Ocean Conference held in 2022.
“The ocean economy offers many opportunities. We must strike the right balance between benefitting from the ocean and protecting its resources,” UNCTAD Deputy Secretary-General Pedro Manuel Moreno said.
Investment facilitation negotiators welcome substantive progress in Draft Agreement (WTO)
At a plenary meeting on 4 May following two days of consultations, WTO members participating in the negotiations on investment facilitation for development (IFD) commended the substantive progress made in the Draft Agreement since the start of this year. The co-coordinators of the talks, Ambassador Sofía Boza of Chile and Jung Sung Park of the Republic of Korea, introduced the latest revision of the draft text, which reflects solid progress towards the objective of finalizing the negotiations by mid-2023.