tralac’s Daily News Selection
The selection: Thursday, 28 July 2016
Breaking Down Barriers: increasing competition in key sectors is critical for competitiveness (World Bank)
Boosting competition in consumer markets and key input sectors can help African countries grow faster and alleviate poverty, according to a report launched today by the World Bank Group and the African Competition Forum. The report, Breaking down barriers (pdf), finds that reducing the prices of basic food staples by just 10%, as a result of tackling cartels and improving regulations that limit competition in food markets, could lift nearly half a million people in Kenya, South Africa and Zambia alone out of poverty and save households in these countries over US$700 million a year.
At the same time, fundamental market reforms to increase competition in key sectors is critical for competitiveness and economic growth. For example, if countries like Ethiopia, Ghana, Zambia and others were to reform their professional services markets, this could generate nearly half a percentage point in GDP growth from industries which use these services intensively. For a country like Zambia, which had 1.7% GDP growth in 2015, this can be significant. The report also suggests that the impact would be even larger if fundamental reforms were implemented in other services such as electricity, telecommunications, and transport which have higher spillover potential across economies. [Competition Commission of South Africa updates: workshop, 28-29 July, on cartel investigation techniques, latest newsletter (pdf)]
Sixth Global Review of Aid-For-Trade Monitoring Exercise: Promoting Connectivity (WTO)
The Sixth Global Review of Aid for Trade, under the theme “Promoting Connectivity”, will be held at the WTO in mid-2017. The deadline for the submission of completed monitoring formats is 31 October 2016. The M&E exercise for the 6th Global Review will review the status of TFA implementation, explore the demand and response to requests for TFA implementation support and survey where difficulties may be arising. The case story exercise seeks to build on the evidence of impacts of trade facilitation support projects and will explore new approaches being tested by developing countries and their development partners, such as those engaging the private sector.
Tanzania: Article IV report, Selected Issues papers (IMF)
Staff Report for the 2016 Article IV Consultation: Sustaining high growth and implementing the development agenda while preserving fiscal and external sustainability will require a range of deep reforms. Somewhat higher fiscal deficits could be sustained for a few years while keeping a low risk of debt distress. However, creating fiscal space for higher infrastructure investment will necessitate first and foremost sustained efforts to raise additional domestic revenue and streamline current expenditure. Reforms to increase spending efficiency, particularly in the area of public investment, will also be needed. More broadly, the targeted high growth and structural transformation of the Tanzanian economy will require a rekindling of the reform agenda.
Selected Issues Paper 1: Productivity, growth, structural reforms, and macroeconomic policies. While lower gas prices affect the profitability of the [LNG] project, the government can improve the prospect of the investment taking place by completing the implementation of reforms on the policy and regulatory framework and by engaging the investors in negotiations about the project. In particular, the authorities should:
Selected Issues Paper 2: Macro-financial issues. State-owned banks also have relatively high non-performing loan ratios. Where Tanzania stands out is in the sheer number of banks (57), which taken together with the poor performance of a number of these institutions, raises the question of whether some consolidation in the sector is warranted.
South Africa and the BRICS NDB: update (The Hindu)
But NDB officials told The Hindu that South Africa’s role would be initially confined within the boundaries of its neighbourhood. However, expansion of the multilateral lender, with larger African membership, can increase the NDB’s continental reach. NDB funding could help reduce Africa’s infra-funding gap, which stands at an enormous $100 billion a year, throttling the continent’s promising growth prospects. “The office can [initially] look at projects only in South Africa and the region,” says Leslie Maasdorp, NDB’s vice-president and chief financial officer. He pointed to two conditions that would guide the NDB’s funding strategy in Africa at this stage. South Africa, he stressed, must be the economic beneficiary of a funded project; and the economic infrastructure of another country receiving the investment, must be integrated with South Africa. “For example if South African companies invest in a water scheme related to, let us say the Cabora Bassa hydro-project in neighbouring Mozambique, it is possible to do so provided the water is transported to South Africa.” “But funding a project between Mozambique and Zimbabwe would not be possible as this would by-pass South Africa.”
Africa will be the secret victim of Brexit (Business Insider)
According to new research from Barclays, Brexit's economic impact on Africa, and particularly sub-Saharan Africa, could be profound and incredibly damaging to the continent's burgeoning development. In a note by analysts led by Peter Worthington, Barclays argues that the referendum will materially affect growth on the continent, saying: "Post-Brexit, we see growth in sub-Saharan Africa halving to just 1.4% in 2016, the slowest pace in decades, due principally to sharply weaker growth outlooks in sub-Saharan Africa's three biggest economies: Angola, Nigeria, and South Africa, which together account for nearly three fifths of SSA GDP." Barclays identifies seven key reasons SSA growth is at risk from Brexit: [Brexit dents Mauritius’ textile sales]
Zimbabwe: Imports fall 13,3% (The Herald)
Zimbabwe imported $2,51bn worth of goods between January and June this year, representing a 13,3% decline on 2015. The decline in the value of imports comes after Government recently introduced legislation to restrict the importation of certain products. Latest trade statistics show that Zimbabwe imported a total of $2,51bn worth of goods in the first half of the year compared to $2,95bn imported last year. The value of exports over the same period also declined in the first half of this year to $1,126 billion from the $1,233 billion the prior year. [Zimra probes vehicle imports from 2014, Mmatlou Kalaba: Lessons to be learnt from Zimbabwe’s blunt use of an import ban, Influx of cheap imports hurt Zim firms]
Zimbabwe operationalises One Stop Shop Investment Centre (The Chronicle)
Zimbabwe's One Stop Shop Investment Centre will be fully operational on August 1 as the Government intensifies efforts to increase foreign direct investment inflows, a senior official has said. The One Stop Shop (OSS) investment centre is the Zimbabwe Investment Authority’s arm tasked with reducing the time investors take to get their projects approved from 49 days to three days. The crucial concept was launched in 2010 but missed operational deadlines over the years.
Dubai Chamber workshop weighs Kenya investment options (CPI Financial)
Highlighting the recent trends in Dubai’s trade with Kenya, Khan informed that over the past few years Dubai-Kenya trade has increased significantly as the non-oil trade between the two sides was AED936.4m in Q1-2016, making Kenya Dubai’s 49th major trade partner as presently, there are 262 Kenyan companies registered with Dubai Chamber, he said.The event formed part of the Chamber's Africa Global Business Forum series.
Asian Influence: Singapore’s increasing role in Africa (KWM)
The Africa Singapore Business Forum is a biennial event attended by a number of business and government leaders seeking to improve relations between the two regions. The next ASBF is due to be hosted in Singapore this August and aims to discuss the strategic growth of both regions. Whilst opportunities are there, some work still needs to be done with regard to the co-operation frameworks between African jurisdictions and Singapore. One key concern that has been noted is the lack of free trade agreements. In addition, the availability of bank finance can be a barrier for some Singaporean SMEs where projects are not seen as bankable, though with more successful cross border transactions this trend should change. However, despite these difficulties, progress is being made:
SADC’s grim reality (New Era)
Speaking at a session on the 15-member organisation during the ongoing Namibia Foreign Policy Review Conference yesterday in Windhoek, Paul Kalenga highlighted the dire situation in which SADC finds itself, stressing that should the EU stop its funding, the body in its current state will cease to exist. Kalenga was speaking in his capacity as the technical adviser on trade related facilities of the SADC Secretariat. He however added that all is not gloom, as SADC’s ministers of finances have made tremendous success in finalising the much-anticipated SADC development fund. “I really do not want to say what is on the table but there is a mechanism … to fund SADC. It is like a re-investment arrangement where SADC can reinvest and generate more funds for itself to fund its development programmes,” stated Kalenga.
Extend Namibia's economic zone - Esau (The Namibian)
Fisheries Minister Bernhardt Esau said Namibia should speed up the extension of its Exclusive Economic Zone (EEZ) so as to maximise fish stocks. Esau said this during the ongoing Foreign Policy review conference in Windhoek. Namibia's EEZ comprises 540 000 square kilometres and a 1 572 kilometre of coastline along the South Atlantic. Esau said Namibia will also need to develop strategic diplomatic and investment relationships on shipping, vessel repair and maintenance, and value-addition with the Southern African Development Community countries, the EU, China, Japan and the Nordic countries whose fishing and trans-shipment fleets operate in and around the EEZ.
Governments across the Eastern African region should enact robust policy and legislative frameworks to promote cross border trade in key staples like maize, said executives from East African Grains Council on Monday. “Our region will only be food secure if governments eliminate artificial barriers to cross border trade in grains. In particular, costly permits for traders should be done away with to ease movement of staple food across borders,” remarked the executives. They added that lengthy clearance procedures for trucks at border points eroded the revenue base of grain traders.
West Africa to get three regional accreditation bodies (Graphic Online)
The West Africa Quality System Programme intends to designate three accreditation bodies for conformity assessment institutions in three West African countries. This is part of its phase three of its programme which is funded by the EU. The Ghana Standards Authority organised the two-day training on food safety management for stakeholders to build their capacity on quality management systems. The participants were trained in skills certification, food processing, auditing accounting, requirements of ISO 22000 and the HACCP-tool used to analyse associated hazards in production among other things.
Mauritius: Djibouti Code of Conduct update (GoM)
In the wake of the intensification of the maritime traffic in the Indian Ocean basin, Mauritius is poised to become a strategic maritime and shipping hub, said Mr Premdut Koonjoo, Minister of Ocean Economy, Marine Resources, Fisheries, Shipping and Outer Islands. On that score Government is keen to facilitate vibrant maritime commerce and economic activities at sea given that these initiatives strengthen economic security while at the same time protect maritime domains against ocean-related threats such as piracy, criminal activities, amongst others, he pointed out.
This paper documents how economies in the East Asia and Pacific region have integrated financially with the rest of the world since the 1990s. First, the region is increasingly more connected with itself and with other economies. Although economies in the North capture the bulk of the region's investments, EAP's connectivity with the South has grown relatively faster. Second, the largest economies in the region (China, Japan, the Republic of Korea, and Singapore) account for most of EAP's cross-border investments. Third, compared with the other South regions, EAP displays a higher level of intraregional and outward investments, reflecting the region's role as a net capital exporter.
SA rejects Zim border passes (NewsDay)
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