Building capacity to help Africa trade better

tralac’s Daily News Selection


tralac’s Daily News Selection

tralac’s Daily News Selection

Today, in Pretoria: SADC Ministers of Labour and Home Affairs are gathered for ‘2017 Regional Conference on Migration Initiatives’. Featured tweet, @IOMROpretoria: Half of SADC member states have developed labour migration policies. #SADClabour

Ongoing, in Abidjan: Second International Conference on the Emergence of Africa. Downloads (pdf): speeches by Helen Clark, Akinwumi A. Adesina, presentation by Abdoulaye Mar Dieye: Cross-sectional analysis of 13 case studies of selected African countries’ experience towards emergence

Ongoing, in Kigali: trade policy conference hosted by IGC Rwanda and the Ministry of Industry and Trade. Featured tweet, by @sally_bm: Small hassles matter: cutting admin procedures/delays equivalent to 10% tariff reduction >> 80% trade volume increase. #MadeInRwanda

Later, this week: Afreximbank and FCI sub-regional factoring promotion conference (30-31 March, Doula); UNDP/DTI launch the Centre for Trade and Regional Integration (30 March, Pretoria)

An update on AfDB 2017 Annual Meetings (22-26 May, Ahmedabad)

Economic Partnership Agreements and the African Continental Free Trade Area (ATPC/UNECA): Policy recommendations (pdf): Maintaining policy space whilst negotiating international trade and investment agreements is crucial in order not to compromise the structural transformation efforts on the continent. This is especially relevant when negotiating bilateral and regional agreements with developed countries. In this light, Africa may consider adopting and using a continental negotiations template for such extra-Africa negotiations.

UNGA President urges Africa: Use innovation and technology to drive economic transformation (RNA)

Addressing a high-level meeting on ‘Innovations for Infrastructure Development and Sustainable Industrialization’ during the ECA’s Africa Development Week in Dakar, Mr Peter Thomson said harnessing this potential requires effective leadership to champion the necessary reforms to ensure the transformative potential of innovation and technology is enjoyed by everyone across Africa. “The rapid pace of advances in innovation and disruptive technology taking place across our world provides an opportunity for these tools to be harnessed in Africa towards advancing sustainable industrialization, development, and growth. Importantly these advances present opportunities to leapfrog high-carbon models, spur green economic growth, and build resilient economies.”

South Africa trade and investment policy:

(i) Illicit financial flows and Base Erosion and Profit Sharing - input by government agencies (PMG): The Standing Committee on Finance, the Portfolio Committees on Trade and Industry and Mineral Resources held a joint meeting on illicit financial flows to hear the views of the following stakeholders in the battle to stop the harmful effects of illicit financial flows (IFFs), transfer pricing and base erosion and profit sharing (BEPS): National Treasury; SARS Customs; Financial Intelligence Centre; Department of Trade and Industry; South African Reserve Bank; South Africa Police Service; National Prosecuting Agency and Department of Mineral Resources. This would lead to recommendations on strategies to deter IFFs and BEPS and ultimately lead to a Money Bill being introduced into Parliament on the matter. [Global Financial Integrity: Transnational crime and the developing world]

(ii) SA: An arbitration-friendly jurisdiction? (Clyde & Co): The International Arbitration Bill, gazetted on 28 April 2016, will shortly be introduced into the SA Parliament. The Bill provides for the incorporation of the Model Law on International Commercial Arbitration, as adopted by the United Nations Commission on International Trade-Law, as the cornerstone of the International Arbitration regime in South Africa. Despite the promising reforms that the Act will bring, it is unlikely that South Africa will become a hub for international commercial arbitrations overnight (refer to the comparative Australian experience discussed below). There also remain a number of legal issues which suggest hesitancy on the part of the South African government to embrace international commercial arbitration wholeheartedly.

Tanzania: Only 35% of development budget funds used so far (IPPMedia)

The government had, by February this year, released just 35% of the 11 trillion/- which was allocated for expenditure on development projects in the 2016/17 financial year ending in June, Finance and Planning Minister Philip Mpango revealed yesterday in Dodoma. Presenting highlights of the draft budget proposals for the coming 2017/2018 fiscal year, Mpango said close to 4trn/- was released for development expenditure, including money that was set aside for local government authorities. According to Mpango, various factors contributed to the slow release of the money, including debt payments, a rise in interest rates on international lending markets, and endless discussions with donors. “We should take into consideration that the decrease in donor funding has not affected Tanzania alone. Various other African countries have also been affected especially on development funds… such countries include Zambia, Ivory Coast, Botswana and Algeria,” he said. [Govt unveils 31.7tri/- Budget]

Tanzania: Contracts of 24 mining and natural gas firms out soon (Daily News)

In a report to the Parliamentary Committee on Energy and Minerals, Tanzania Extractive Industries Transparency Initiative Executive Secretary Benedict Mushingwe said yesterday that all companies have since been informed about this latest government move. “In implementing the requirements of the law governing TEITI, the Ministry of Energy and Minerals wrote letters to the 24 companies holding Mineral Development Agreements and Production Sharing Agreements informing about its plans to disclose (contents of the) agreements public,” Mushingwe said. He explained that the companies should have responded by now, informing the TEITI committee whether there were any sections in the agreements which they wouldn’t want made public. But he added that of the 24 firms, just two had since submitted their recommendations.

Botswana: Pelaelo implores Stanbic to list on BSE (Mmegi)

Bank of Botswana governor, Moses Pelaelo has advised Stanbic Bank Botswana to consider listing on the Botswana Stock Exchange as a way of showing commitment to the country and giving Batswana a chance to own shares in the bank. Stanbic Botswana’s asset base has grown significantly from P138 million in 1998 to P12 billion as at December 2016 and in the same period the bank has consistently made profits with its net income after tax increasing from P2.2 million in 1993 to P192 million in 2016.

Mozambique: Vale concludes sale of assets in Mozambique to Japan’s Mitsui (MacauHub)

After about three years of negotiations, the Mitsui group agreed to buy 15% of the 95% stake owned by the Brazilian group in the Moatize coal mine (the remaining 5% is owned by the Mozambican state) and half of the 50% the Vale group owns in the Nacala Logistics Corridor, which comprises a railroad between Moatize and Nacala and port facilities.

Nigeria bans importation of packaged tomato paste (Nigeria Today)

The federal government on Monday banned the importation of tomato paste, powder or concentrate. Speaking on behalf of the government, the Ministry of Industry, Trade and Investment also increased the tariff on importation of tomato concentrate among others from five to 50 per cent in order to revive the tomato sector. The development was seen in a document obtained by THISDAY from the Federal Ministry of Industry and trade and investment titled: ‘Implementation of the tomato sector policy’. Operators have also said that the current value of imported tomato paste in Nigeria is about $170m while $50m is spent on triple tomato concentrate.

Liberia: PATEL cites problems with ECOWAS tariff (Liberian Observer)

The National Chairman of the Patriotic Entrepreneurs of Liberia (PATEL), Presley S. Tenwah, said the Common Extended Tariff of ECOWAS, if amended by the Legislature, would be a bad law that leaves Liberian businesses at a disadvantage, arguing that most Liberians are engaged in small businesses. Tenwah said most of the goods Liberian businesses trade in, such as used clothes, used cars and the like, are not part of the goods that would benefit from the ECOWAS tariff. The PATEL chairman made the observation on Monday during a public hearing on “An Act to Amend the Act Ratifying and Adopting the ECOWAS Common External Tariff as Amended.” The public hearing was conducted by the chairman of the Joint Committee on Ways, Means, Finance & Development Planning and Commerce & Trade, Rep. Prince Moye.

Anabel Gonzalez: Three challenges Latin American economies must overcome to boost intraregional trade (World Bank)

A study just released by the office of the World Bank’s Latin America chief economist identifies important advantages of regional integration for Latin America’s economies: it clearly identifies the efficiency gains associated with deeper integration between the southern and northern parts of the region. According to the study, the average efficiency gains that countries like Argentina and Mexico could obtain from regional partners outside their sub-region are comparable to those that could be attained by trading with countries elsewhere in the world. So what is needed to boost intra-regional trade in Latin America? Some of them are obvious – for example, some countries would do well to reduce their tariffs and pursue formal trade agreements. On top of that, though, policy-makers increasingly see three key areas hindering the success of regional, and global, integration:

India’s overseas container trade volume doubles in 2016: Maersk report (Mint)

India’s overseas container trade volume doubled in 2016 to 10% compared to the previous year, showing signs of revival in global economic activity, according to a report prepared by transport & logistics company Maersk Group. While containerized exports jumped 11% in 2016 from a meagre 2% a year ago, containerized imports picked up to grow at 10% in 2016 from 8% in the previous year.

Why taxing remittances is a bad idea (World Bank)

In 2016, migrant remittance flows to developing countries amounted to $440 billion, more than three times the size of official development aid flows. In many countries, remittances are the largest source of foreign exchange. In India and Mexico, they are larger than foreign direct investment; in Egypt, they are larger than the revenue from Suez Canal; and in Pakistan, they are larger than the country’s international reserves. Recently, a number of rich countries that host a large number of migrants are considering taxation of outward remittances, in part to raise revenue, and in part to discourage undocumented migrants. We outline below nine reasons why taxing outward remittance flows is a bad idea:

Trade in services related to the environment (pdf, Joint Working Party on Trade and Environment, OECD)

Results from a case study looking at 61 companies providing environmental consulting and engineering C&E services — a type of environmentally related service — seem to corroborate the above finding that services trade restrictions are associated with a lower export performance by firms. Because environmental C&E services feed into numerous projects spanning all sorts of environmental domains, restricting the supply of these services makes the diffusion of cleaner technologies and practices unnecessarily costly. The case study also finds exporting firms to be larger, more productive, and to pay higher salaries than their domestically focused counterparts. Efforts to remove remaining obstacles to trade in environmentally related services could therefore have important implications for sector-wide productivity, skills, and earnings.

Today’s Quick Links:

ICGLR-EAC meeting: communiqué

Tanzania: Construction firms urged to team up with Chinese experts

The Belt, Road: New opportunities for China-Nigeria cooperation

KRA to install scanners at SGR stations to monitor cargo

Measuring the environment for e-commerce: a new tool

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