Building capacity to help Africa trade better

tralac’s Daily News Selection


tralac’s Daily News Selection

tralac’s Daily News Selection

The Africa Development Week opens in Dakar with a clarion call for policies that cater for youth

Nigeria, Cameroon, Ghana, Sierra Leone: Youths get network for sub-regional trade

Building for success: a world trade agenda for the Buenos Aires Ministerial (ICC)

“Challenging times” call for bold trade policy initiatives at the international level, says a new report produced for ICC by the European Centre for International Policy Economy launched in London. Charting a path forward, the ECIPE report (pdf) highlights five especially important issues for the WTO to address at the organisation’s Eleventh Ministerial Conference in Argentina this December: (i) trade in non-agricultural goods, (ii) trade in services; (iii) e-commerce; (iv) improved rules on ‘new’ competition distortions regarding state-owned enterprises, local content requirements and export restrictions; and (v) investment. Digital trade policy merits particular attention from the WTO, the report argues, as new technologies are fundamentally changing the structure and functioning of the global economy.

WTO members review further proposals to ease global trade in services (WTO)

WTO members discussed five new or enhanced proposals to advance services negotiations at meetings of the Working Party on Domestic Regulation and the Services Council on 14-17 March 2017. Four of these proposals aim to ensure that domestic licensing procedures and technical standards do not constitute unnecessary barriers to trade while one proposal relates to the establishment of a trade facilitation agreement for services.

Rwanda to host continental e-commerce summit in July (New Times)

This will be the inaugural YouthConnekt summit engaging the entire continent and will run under the theme, “Harnessing Africa’s Demographic Dividend.” The summit will be co-organised by UNCTAD, the UN Development Programme and the Government of Rwanda. The YouthConneckt initiative was launched in 2012 by the Government to reach out to young people across the country in multiple aspects, including access to finance, entrepreneurship, among others. The summit, slated for 21 July, is expected to attract over 2,500 delegates, including African Heads of State, the youth, global business executives and leaders from international development organisations. The meeting will also be attended by the founder and chairperson of Alibaba, Jack Ma – who is also the special envoy for UNCTAD.

A selection of postings on South African trade policy issues:

(i) The Western Cape: Africa’s trade and investment springboard (pdf, Wesgro): Trade in the Western Cape was driven by 2016 export growth to the Americas (of 25%), Oceania (of 15%) and Asia (of 10%). The products contributing to this growth were agricultural goods as well as engine parts, diodes and hot-rolled iron and steel. Imports totalled ZAR192bn in 2016, decreasing by 2.2% from 2015. Where Western Cape exports have flattened out in 2016, imports have continued to decline from 2013/2014 levels caused mainly by the decline in the value of refined petroleum imports and in part by the declining imports of alcoholic beverages and spirits. The traditional export markets such as the United Kingdom the Netherlands, and the United States are important to the Western Cape economy and are strong drivers for exports. All three of these traditional markets saw double-digit growth from 2012 to 2016, with exports to the United States growing by 23% p.a. The growth of these three markets translated into an increase of ZAR3.35bn in exports in 2016. SACU accounted for 20% of the province’s total exports, second only to the European Union which accounted for 28% in 2016. Together these two sub-regions account for almost half of Western Cape exports. The inclusion of the SACU countries in 2014 figures has provided a strong indication of the impact these countries have on Western Cape exports.

(ii) Willemien Viljoen, tralac Researcher, comments on South Africa’s expanding citrus fruit and grape export markets

(iii) Summary of challenges facing the SA poultry sector: presentation by the Department of Trade and Industry to the Portfolio Committee (pdf). The presentation covers: Status of the domestic industry, Why is there a crisis?, Why it is important to support the industry and the trade-offs?, Trade Policy instruments and measures implemented to date, Task Team: possible support measures. Extract: Domestic demand and production has increased alongside significant import penetration: (i) Poultry consumption soared in period up to 2010 (roughly coinciding with commodity boom) but levelled out from 2010, (ii) Imports climbed from 8% of total consumption in 2003 to over 20% from 2010 to 2013, (iii) From 2003 to 2010, imports rose 11% and local production 7% a year

(iv) The chickens are coming home to roost in the poultry and banking sectors (Daily Maverick): Chickens. Banks. Different sectors, same issues: transformation (radical or not), government (in)action and economic growth, or lack thereof. It’s not a case of why did the chicken cross the road, it’s why did the frozen chicken cross the ocean? Or, in the case of the banks and the broader financial services sector, who really owns whom? Two days of public hearings by Parliament’s trade and industry committee, including one alongside the finance committee, highlighted the role of foreign ownership in South Africa’s economy, transformation in trouble, and structural inequalities. [Don’t protect ‘unproductive’ chicken industry - meat association (Fin24)]

(v) SA’s Competition Commission raids fresh produce market agents for suspected price fixing: statement (pdf)

Zimbabwe: RBZ warms up to Rand adoption (Daily News)

Zimbabwe’s central bank is warming up to adoption of the South African Rand as a dominating currency following various calls from business in favour of the exchange. In an apparent u-turn from his previous stance, RBZ deputy governor Kupukile Mlambo, on Thursday, said Rand domination would benefit the country, presently battling an acute cash crisis and help alleviate cash shortages. Mlambo pointed out that the central bank would prefer for the South African currency - which firmed 0,6% against the Dollar on Wednesday just off the 20-month high reached earlier this week - to be Zimbabwe’s dominant currency, following hints by President Robert Mugabe in a recent interview that the country needed to adopt the Rand.

Botswana: Business decries slow pace of reforms (Mmegi)

During a Botswana National Productivity Centre consultative workshop held recently, members of the business community noted that the implementation of these reforms has been long talked about but to date things are still the same, making doing business difficult. The Ministry of Investment, Trade and Industry principal industrial officer, Tidimalo Sitang said: “The government is very aware that the business reforms will reduce the cost of doing business in Botswana hence promoting investor friendly climate and reduce frustrations businesspeople face in order to make an investment or start a business. For instance, starting a business in Botswana takes at least 48 days while in countries like Singapore that continues to be ranked the best in the Global Competitiveness Index it takes exactly one day to establish a business.”

A selection of postings on South Sudan:

(i) South Sudan: 2016 Article IV Consultation (IMF): Box 4: The Risks of a Delay in Policy Action. Without significant progress towards peace and economic stabilization, as assumed in the baseline projection, the economic trajectory for South Sudan becomes highly unstable. A downside scenario demonstrates the risks of the baseline by assuming a three-year delay in achieving peace and implementing economic stabilization policies. The underlying assumptions include (i) stagnating oil production because oil companies are unwilling to invest to rehabilitate the aging oil wells in the middle of civil war; (ii) rising instability will maintain a large number of internally displaced people and refugees, which will dampen activity in the nonoil sector; (iii) the country will continue to have no access to external financing; and (iv) budgetary spending will accelerate reflecting higher security-related expenses. Key macroeconomic indicators under this scenario will therefore deviate significantly from the baseline scenario:

(ii) South Sudan and the Eastern Africa Regional Transport, Trade and Development Facilitation Programme (pdf, World Bank): The project was approved on May 20, 2014, signed on June 12, 2014 and became effective on December 22, 2014 with closing date of December 30, 2019. All project activities are on a ‘pause’ due to renewed crisis after 8 July 2016 in South Sudan.

(iii) UNSC debate, text of Presidential Statement on South Sudan: In his briefing, Secretary-General António Guterres warned the Council not to underestimate the dangers of South Sudan’s trajectory and to act with one voice to pull the world’s youngest country “back from the abyss”. All optimism that had accompanied South Sudan’s birth some six years ago had been shattered by internal divisions and irresponsible behaviour by some leaders. Festus Mogae, Chairman of the Joint Monitoring and Evaluation Commission for South Sudan, said that, whether by design or default, a war was being waged around the country.

(iv) South Sudan’s national dialogues: can the AU make a difference? (ISS)

East Africa’s oil ambitions tested by pipeline machinations (Bloomberg)

A decade after its first big oil find, East Africa’s emergence as a crude exporter has been hindered by security and cost concerns that left the region building two pipelines instead of one. Uganda and Kenya are developing two new basins and originally agreed to build one line to connect the landlocked discoveries to the coast. Two pipelines will test the economics of the developments. Both projects probably need an oil price of $50 to $55 a barrel to break even, while lower costs or taxes may be required to justify a final investment decision in Uganda, according to BMO Capital Markets.

ECOWAS, Mano River Union to Strengthen Trade Liberalization (FPA)

In an effort to consolidate common market and the creation of a free trade across borders in West Africa, countries in the Mano River Basin have begun creating awareness about the ECOWAS Trade Liberalization Scheme which provides opportunities for citizens trading in the region. ECOWAS Special Representative Ambassador ‘Tunde Ajisomo commended Member-States in the MRU that have commenced ETLS implementation, such as Cote d’Ivoire since 1998 with a total number of 274 approved enterprises, and 957 originating products. Ajisomo continued: “Guinea, on the other hand, commenced ETLS implementation also in 1998 with 17 approved enterprises, and 43 originating products, while Sierra Leone, on its part, commenced ETLS implementation in 1991, with 10 approved enterprises and 14 originating products. In the case of Liberia, we are delighted that it commenced the ETLS implementation at the beginning of 2017, with no approved enterprises or originating products yet.”

Public spending priorities for African agriculture productivity growth (World Bank)

Reforms in public spending would boost agricultural productivity in Sub-Saharan Africa, raising farmer’s incomes, and promoting broader economic growth, says a new World Bank report. Reaping Richer Returns: Public Spending Priorities for African Agriculture Productivity Growth explores the performance of agricultural spending in Africa, and presents a wealth of important lessons from which African policy makers and development practitioners, and academics can draw options for reform.

The impact of the trade environment on women’s employment: UNCTAD side event at Commission on the Status of Women

A decrease in the fragmentation of production across countries, a shift towards domestic demand and an increase in the use of technology are factors affecting labour markets and women’s job opportunities, said Sheba Tejani (pdf), Assistant Professor of Political Economy at The New School for Social Research. “Robots and automation are new challenges that workers will soon have to face, with sectors such as textiles and light manufacturing expected to be particularly affected. And these are the very sectors that employ many women,” Ms. Tejani said, adding that although these technologies currently affect some countries more than others, all will be confronted with this new reality in the future. [Downloads]

Today’s Quick Links:

Tanzania: Foreigners now to undergo new work permit scrutiny

Namibia: Lüderitz moots new deep water port

Zimbabwe: SMEs formalisation policy process at advanced stage

Ethiopia and Gulf countries trade relations flourishing

Validation workshop of the AU policy on business and human rights

A Brookings commentary on G-20 and trade: How worried should we be?

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