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tralac’s Daily News Selection
The selection: Friday, 29 July 2016
South Africa’s June trade balance figures will be released today. The Bloomberg consensus is for a narrowing of the trade surplus to R7.2bn in June, from R18.7bn in May.
Featured African trade policy process: ECOWAS moves to develop a regional services trade policy
ECOWAS has commenced a three day workshop aimed at developing a Regional Services Policy, strengthen policy formulation, and identify best-fit regulatory and institutional frameworks and negotiation capacity on trade in services. The ECOWAS Director of Trade, Dr Gbenga Obideyi said participants will also focus on issues concerning the formulation of an ECOWAS Common Trade Policy in services as well as the Continental Free Trade Area under the auspices of the African Union and the Economic Partnership Agreement services negotiations between the region and the EU. The ECOWAS Regional Services Policy Review will be formally launched as part of the Workshop.
President Mkapa: ‘EPA has never made much sense for Tanzania’ (Daily News)
Statistics show that in fact, for the EAC region, the African market is the primary market for its manufactured exports. In contrast, 91% of its current trade with the EU is made up of primary commodity exports (agricultural products such as coffee, tea, spices, fruit and vegetables, fish, tobacco, hides and skins etc). Only a minuscule 6% or about $200,000 of EAC exports to the EU is composed of manufactured goods.In contrast, of the total EAC exports to Africa, almost 50% is made up of manufactured exports - about $2.5 billion - according to 2013 – 2015 data. Of this, $1.5 billion are EAC country exports to other EAC countries. These figures tell two stories: [Brexit: scapegoat for EAC countries to back out of the EPA? (tralac)]
Kenya overtakes SA as biggest investor in African countries (Business Daily)
Kenya overtook South Africa to become the biggest investor in other African countries in terms of the number of projects in 2015. Kenya invested in 36 projects last year in other parts of the continent against South Africa’s 33, a new study by financial consulting firm Ernst & Young shows. It noted that most of Kenya’s intra-Africa investments went into countries within the EAC. The study said Kenya’s global ranking as a source of FDI to the African continent also improved strongly to the seventh position in 2015 from 13th in 2014. South Africa however beat Kenya in terms of the worth of the projects as it had Sh200 billion compared to Kenya’s Sh100bn.
South Africa: Davies awaits next move from Harare (Business Day)
Trade and Industry Minister Rob Davies is awaiting a response from his Zimbabwean counterpart for a meeting to resolve a dispute over Harare’s ban of certain imports from SA as a trade delegation from that country cancelled a visit to SA until "further notice". Davies — who conceded that the ban had taken him by surprise because it came amid trade negotiations centred on surcharges — on Wednesday said any trade mission visit between the countries would not be "fruitful" in light of the talks over Zimbabwe imposing a ban on South African goods.
COMESA: ‘Engage Zimbabwe on import ban’ (NewsDay)
The Common Market for Eastern and Southern Africa says it will not intervene in resolving the impasse created by an “import ban” imposed by Zimbabwe, urging member states to engage on bilateral grounds. Speaking at the third sensitisation workshop for business reporters in Livingstone yesterday, Comesa Competition Commission director and chief executive officer George Lipimile said Zimbabwe was a peculiar country and SI 64 was a remedy to the recovery of the economy. “It’s being looked at as a trade matter, it’s an issue of respecting the economic model of each country. Zimbabwe has its own peculiar situation that they are dealing with so that is one way of remedying their economy. I tend to think it’s unlikely that Comesa will get involved. It’s an internal matter so most countries will deal with it bilaterally,” he said.
Namibia: Economic Outlook July 2016 (pdf, Bank of Namibia)
Namibia’s real GDP growth is projected at 4.4% and 5.4% for 2016 and 2017, respectively. The projected growth for 2016 represents a slowdown from the preliminary national account estimates of 5.7% for 2015. The expected slowdown in 2016 is mainly attributed to the decline in growth of the construction sector, as well as, the diamond mining sub-sector. There are notable improvements in the uranium mining sub-sector and a lesser contraction in the agriculture sector; however, these developments may not be sufficient to avoid a slowdown in overall growth for 2016. Over the medium-term, growth will be supported by increased mining output from new and existing mines, and sustained growth in wholesale & retail trade.
Dangote signals slower pace of African cement expansion (Bloomberg)
Dangote Cement Plc signaled it may ease the pace of adding new capacity amid foreign exchange constraints in its home market of Nigeria, as Africa’s largest producer of the building material reported a decline in first-half profit. While the company remains committed to its ambitious growth plans, “we are taking a more measured approach to the roll-out of new capacity across Africa,” Chief Executive Officer Onne van der Weijde said.
Roger Williamson: 'Made in Africa: learning to compete in industry' (UNU-WIDER)
This book [the new UNU-WIDER and Brookings book Made in Africa] is a valuable resource with a distinctive message and realistic tone. Even though much can be done, the authors do not expect a replication of the East Asian take-off. There is a chance for Africa to “break in” as East Asia did in the 1980s, becoming the “world’s factory.” Changes in Asia such as rising labour costs and increasing demand for goods in Asia are among factors which provide the opportunity for Africa initially to pick up some of the basic manufacturing jobs and progressively to move up the value chain in manufacturing, agro-industry and services. The authors temper this optimism somewhat: “We would be very surprised if the most successful African economy in 2030 looked like Vietnam today”.
Building tax capacity in developing countries: IMF submission to G20 finance ministers (IMF)
An indispensable prerequisite to improving tax capacity is enthusiastic country commitment. While such political commitment must arise within the country and its government and cannot be created by external support, the report assesses ways in which such support can encourage and reinforce that necessary commitment. Given such commitment, the report points to several key enablers to building tax capacity: (i) a coherent revenue strategy as part of a development financing plan, (ii) strong coordination among well-informed and results-oriented providers, (iii) a strong knowledge and evidence base, (iv) strong regional cooperation and support, (v) strengthened participation of developing countries in international rule setting. [Jim Brumby: How can we build tax capacity in developing countries?]
Chinese, African companies ink $17bn deals (Xinhua)
The deals, involving financial institutions and enterprises, were signed on the eve of a meeting on delivering the outcomes of the Johannesburg Summit of FOCAC. More than 400 participants from government agencies, financial institutions, business associations and enterprises attended the Seminar on China-Africa Business Cooperation and Signing Ceremony in Beijing on Thursday. The seminar was hosted by the China Council for the Promotion of International Trade. [Malawi-China business forum bearing fruits as it has roped in 11 investors (Maravi Post)]
Peacebuilding in Africa: UNSC open debate, Presidential Statement (UN)
Smail Chergui, the AU’s Commissioner for Peace and Security, discussed lessons learned from recent relapses of post-conflict countries into violence. There needed to be a greater focus on coordination among all actors and integrating planning and operations. If properly calibrated, post-conflict reconstruction and development interventions would be critical to African Union conflict-prevention strategies, he said, calling for institutionalized annual meetings between the United Nations and African Union to share lessons learned. Among donor countries, the US representative said national ownership of peacebuilding processes must not be pretext for inaction on the part of the Council or the international community. Too often, she said, that was the case. Political leaders needed to be held to account to halt violence and uphold the rule of law, she added. The EU’s representative said regional integration initiatives had been undermined by the fact that States often belonged to regional groups with identical or overlapping mandates. Another challenge was that regions’ political ambitions were not sufficiently underpinned with operational capacity and resources, which, in turn, limited their absorption of aid. [IGAD: update on regional strategy on preventing and countering violent extremism]
Gender budgeting and gender equality database: study of 14 SSA national experiences (pdf, IMF)
Our review of gender budgeting in sub-Saharan African found that Rwanda, Uganda, and South Africa have achieved some successes with gender budgeting, chiefly through changes in fiscal policies or budget-making procedures. However, it is difficult to link gender budgeting directly to these changes, given the complex environment for fiscal decision-making in these and other countries. We found that, in the countries where gender budgeting seems to be most effective, Ministries of Finance are taking the lead. For example, Ministries of Finance in Rwanda and Uganda have mandated that other ministries or levels of government responsible for social welfare or women’s development try to address gender gaps and women’s needs in their budgets. Parliamentarians also played a catalytic role in these countries. [Access the full set of companion IMF studies]
Pradeep S. Mehta, Smriti Bahety: 'India-US trade: give some, take some' (LiveMint)
The reason for the slowdown in the negotiation momentum can be attributed to two factors. First, India and the US have had fallouts at the WTO pertaining to poultry imports, solar panels and more recently on visa fee hikes by the US. The second reason is attributable to the significant differences in India’s new model BIT and the US’ 2012 model BIT.
UK lagging behind ‘Digital Tiger’ economies (Barclays)
The Barclays Digital Development Index benchmarks 10 countries around the world on their readiness to compete in the digital economy. The study, which attributes an overarching ‘digital empowerment’ score to each nation, found that the UK came in just fourth place behind new and emerging ‘digital tiger’ economies Estonia, South Korea and Sweden. When it comes to individuals’ assessment of their own digital skills and confidence, the UK trails major economic rivals India, China and the USA. The findings are based on a survey of almost 10,000 working adults combined with analysis of policy frameworks and support for the development of digital skills in each country.
Greater Mekong Subregion Economic Corridors Forum (4 August, ADB)
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