tralac’s Daily News Selection
CFTA negotiations update, @CK_Knebel: H.E. Acyl @AUTradeIndustry opens CFTA workshop on tariff modalities & thanks @UNCTAD for support & highlights proposed joint work on NTMs
Free Movement of People and Goods and its Implications on Peace and Security in Africa: PSC communique (AU)
The Peace and Security Council of the AU, at its 661st meeting held on 23 February 2017, at the ministerial level, adopted the following decision on Free Movement of People and Goods and its Implications on Peace and Security in Africa: Also acknowledges that besides facilitating regional and continental integration, the benefits of free movement of people, goods and services, far outweigh the real and potential security and economic challenges that may be perceived or generated; Commends all Member States which have already signed and ratified all relevant AU instruments on free movement of people and goods, and encourages those Member States which have not yet done so, to also do the same. In the same context, Council urges Member States to address all institutional and regulatory capacity gaps, in order to have a common policy on free movement of people and goods;
Further commends Member States that have already started to issue visas on arrival to fellow African citizens, namely: Benin, Ghana, Mauritius, Rwanda and Seychelles and urges other Member States to also put in place necessary measures to ensure the issuance of visas on arrival for African citizens while at the same time taking the necessary security precautions; Appeals to Member States, within the spirit of promoting free movement of people and goods in the African continent, to refrain from imposing harsh penalties to fellow African citizens who would have over-stayed in their countries beyond the period stipulated in the visas and to facilitate their exit to destinations of their choice; [IGAD to hold a Special Summit on Somali Refugees (25 March, Nairobi)]
South Africa: January trade balance swings into deficit (SARS)
The R10.81bn trade balance deficit for January 2017 is attributable to exports of R80.59 billion and imports of R91.40bn. Exports decreased from December 2016 to January 2017 by R13.09bn (14.0%) and imports increased from December 2016 to January 2017 by R10.13bn (12.5%). December 2016’s trade balance surplus was revised upwards by R0.37bn from the previous month’s preliminary surplus of R12.04bn to a revised surplus of R12.41bn as a result of ongoing Vouchers of Correction. [Ahead of the release: From Standard Bank – Bloomberg consensus is for it to have swung into deficit, to -R3.4bn, from R12.0bn in December. Our economics team expects the trade balance to follow its seasonal pattern and to have moved into deficit in January, to -R8.4bn.]
Government’s “Made in Rwanda” initiative seems to be paying off and according to experts, the campaign is key in correcting and balancing Rwanda’s trade books. There is potential to produce most of the imported commodities locally which could have a huge potential and positive impact on Rwanda’s trade balance, according to experts. The Central Bank governor, John Rwangombwa, says Rwanda’s trade balance improved with export cover of imports improving to 32% in 2016 compared to 28% in 2015.
Nigeria: Q4 2016 GDP Report (Bureau of Statistics)
In real terms, trade recorded negative year on year growth, of -1.44%. This was a larger decline than that recorded in the previous quarter of -1.38%, as well as a fall in growth compared to the rate of 4.69% recorded in the fourth quarter of 2015. Quarter on quarter growth stood at 5.79% in the fourth quarter of 2016. Full year 2016 Real GDP contracted by -0.24%, which was 5.38% points lower than the growth of 5.14% in 2015. In real terms, Trade’s contribution to GDP was 16.65% in the fourth quarter of 2016, slightly lower than the 16.68% it represented in the previous year, but higher than the 16.39% recorded in 2016 third quarter. [Download (pdf)]
The real effective exchange rate (REER) is an important metric for a country’s competitiveness. It can determine the degree to which a resource-dependent economy can use its resource rents to achieve transformation through growth in non-extractive sectors. Here, we look at the recent REER experience of Nigeria and compare it with that of Indonesia. Where Indonesia’s currency policy was an important precursor to its transformation, Nigeria has remained largely resource dependent. [The analyst: Phyllis Papadavid]
SADC Investment Subcommittee Forum: update (Swazi Observer)
Jabulani Mabuza (Swaziland’s Minister of Commerce, Industry and Trade) called upon the forum to find feasible ways of promoting regional investment inflows as they seek to reach a harmonised investment policy framework. “The ease of doing business remains fundamental to making SADC a compelling investment destination,” he said. Mabuza also warned the forum to be mindful of external factors that may undermine the region’s good efforts, especially climate change. “Therefore, the development of a policy framework should woven within the ambit of sustainable development. We cannot forget the effects of the recent drought, which sought to reverse some of the gains that our economies have realised in the past decade,” said Mabuza.
Review of social issues for large-scale land investment: This working paper focuses on the social constraints to expanding biofuel production in Zambia through large-scale investment models. This is done by reviewing the literatures on the experiences of large-scale land acquisition in Zambia and the social impacts of these and on the legal mechanisms that shape outcomes. [The analyst: Giles Henley]
Approaches to supporting local and community development: This paper examines the modalities and results of mining community development programmes in Zambia as part of the broader discussion on how large international mining companies can, and do, contribute to local and community development. It narrates the approaches adopted by five multinational mining corporates, two of which are Chinese-owned, and discusses the advantages and disadvantages of each approach. [The analyst: Angel Mondoloka]
Northern Corridor: Uganda, Kenya, Rwanda launch regional electronic cargo tracking system (URA)
The web-based cargo tracking system was first introduced by Uganda Revenue Authority three years ago. Thereafter, Kenya and Rwanda decided to adopt the system. Several challenges prompted the Kenya and Rwanda to adopt the system. Among them was the lack of monitoring mechanisms, dumping and diversion of goods. The challenges affected revenue collection. “Last year’s average clearing time countrywide was 2.07 days. We intend to reduce this by 60% after the RECTS implementation. We would like the exports to be cleared in a matter of hours. We have about 190,000 annual transit consignments along the northern corridor,” stated Customs Commissioner, Dicksons Kateshumbwa.
Botswana Unified Revenue Service hosted a WCO Revenue Package national workshop (20-23 February, in Gaborone) with the aim of preparing the Administration for the implementation of an advance ruling system for classification and origin, as required under the WTO Trade Facilitation Agreement. During the discussions, the participants also considered other measures that could improve the classification and origin infrastructure. Being a member of SACU (the South African Customs Union) it was suggested that creating a consultation forum with other SACU countries would improve the work at regional level. The establishment of a customs laboratory at national level, a regional (SACU) laboratory, or using a private laboratory were also given attention. Finally, more capacity building was also sought.
Zimbabwe: AG’s office works on National Ports Authority Bill (The Chronicle)
A Bill to establish the National Ports Authority that will run the country’s border posts is now at the drafting stage. Minister of Transport and Infrastructure Development, Dr Joram Gumbo, said cabinet had approved the decision to set up the agency and that the Attorney General’s office was now busy drafting the Bill. Dr Gumbo said the authority will deal with operations, administrative, security and health issues at border posts, among others.”The authority will be an independent body dealing specifically with issues regarding the operations at our border and not bogged down by technical issues. It is very critical that we make our ports of entry user-friendly for regional and international trade. “We want a situation where operations are coordinated from a central point to avoid discord,” he said. Some of the stakeholders at border posts include: Department of Immigration, Zimbabwe Revenue Authority, Police, Ministry of Health, Environmental Management Authority, Forestry Commission, Veterinary Services and a private security company among other security agents.
AfDB debt mission heads for Zimbabwe (NewsDay)
A team from the African Development will tomorrow hold a meeting with civil society organisations and development partners on Zimbabwe’s debt and arrears clearance strategy and options. The meeting will be held at the National Association of Non-Governmental Organisation offices in Harare. Nango said the joint multi-sector mission would be led by Sibry Tapsoba, the bank’s director for the Transition Support department.
African citrus sales concern RSA (Fruitnet)
South Africa’s citrus industry says it is concerned about the low level of exports into Africa and has launched a new strategy to develop sales in countries on the rest of the continent. “Exports of citrus from South Africa, Swaziland and Zimbabwe into the African continent are extremely low,” explains the CGA’s Justin Chadwick. “In 2014, 766,000 cartons were exported into Africa, by 2016 this had doubled to 1.5m cartons, but this represents only 1% of total exports.” Chadwick says this is in stark contrast to the apple industry, where 28% of the 2016 crop was destined for Africa. [Kenya: China to purchase Kenyan mangoes amid bumper harvest]
Fragility and development in the Democratic Republic of Congo (pdf, International Development Committee)
Private sector and business environment reform: We believe that there is a more fundamental issue surrounding support for economic development. We believe that we should see much tighter return on investment criteria. Either the majority of the funding should be in the form of returnable capital which can then be re-invested by DFID at a later date or—if it is given in the form of grants — we should see returns of up to 10 times the investment. So in future economic development projects costing £1 million should yield £10 million over the course of 4–5 years in either a) increased incomes; b) additional non-DFID investment; or c) very carefully calculated non-cash benefits, such as improvements to health and education.
Traidcraft have put together a paper (pdf) that looks at the options for the UK’s trading relationship with developing countries and offers a clear recommendation for how we can ensure that Brexit does not undermine global development. In this blog, we will deal what on the surface looks like the most politically attractive option (continuing existing EU treaties) and present our suggested alternative – a non-reciprocal market access scheme.
Better Business, Better World: sustainable business opportunities in Africa (Business and Sustainable Development Commission)
African business leaders and entrepreneurs can unlock significant economic opportunities worth US$1 trillion in the region and US$12 trillion globally if they pursue sustainable business models. These opportunities and how to achieve them take centre stage at two events, hosted by Safaricom and Intellecap in Nairobi, to launch the African Better Business, Better World report from the Business and Sustainable Development Commission.
Sino-African e-commerce takes off (African Business)
According to Fu, transactions in 2016 were worth nearly $200m. The briskest business is in Kenya, aided by Amanbo’s bilingual site in Swahili and Chinese, a showroom in Nairobi displaying over 5,000 products and its cooperation agreement with the Kenya National Chamber of Commerce. Amanbo follows an “online + social + offline” business model. It boosts its business with offline offices in 10 countries – Kenya, Uganda, Egypt, Cameroon, Togo, Niger, Côte d’Ivoire, Sierra Leone, Burkina Faso and Mali.
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