tralac’s Daily News Selection
Featured tweet/infographic, @RencapMan:
While some like to suggest the Africa Rising story is over, there are an awful lot of African countries still growing at 5% or more
Profiled Spring Meetings analyses:
Africa’s Pulse: Why we need to close the infrastructure gap in Sub-Saharan Africa (World Bank), World Economic Outlook, April 2017: gaining momentum? (IMF)
The report (pdf) assesses the performance of the region in six key sectors, namely Agriculture, Livestock, Fisheries and Food Security; Natural Resources and Environmental Protection; Regional Economic Cooperation and Integration; Social Development; Peace and Security; and Gender Affairs. In terms of inter-linkages and synergies, the report examines the policy coherence within sectors and with each other, institutional collaboration and programme coordination of the various programmes under each sector. The Report further looks at IGAD’s corporate governance. Furthermore, looking ahead with foresight, the Report takes the implications of mega trends in the region into account and aims to offer scenarios for the strategic planning. [The report was compiled by Dr Mehari Taddele Maru]
In Washington: Adeosun calls for global support to tackle illicit financial flows (ThisDay)
Addressing the Global Parliamentary Conference at the ongoing IMF/World Bank Spring meetings in Washington, Nigeria’s Minister of Finance, Mrs Kemi Adeosun, stressed the need for strong executive and legislative collaboration. “To improve non-oil revenues, we have to address illicit capital flows. When stolen money is transferred from Nigeria, or other African countries, there are too few questions asked by those countries that receive the funds, but when we identify those funds as stolen and seek to recover them, there are too many questions being asked. There is money sitting in foreign bank accounts that we have spent over a decade trying to recover. That is money that could deliver significant value for Nigeria as we seek to increase spending on critical infrastructure and establish a basis for long term sustainable growth. I hope that the Automatic Exchange of Information scheme coming into force next year will be a step towards achieving greater transparency, but we need more collaboration amongst parliamentarians in Africa, and across the world to ensure that this situation improves and that recipient countries are held to account.”
A team of six MEPs, headed by Bernd Lange (S&D group), will be in Ghana and Ivory Coast, meeting politicians, business leaders and civil society from Tuesday to Thursday, finishing with a press conference in the Ghanian capital Accra on the final day. According to a statement from the MEP committee, the visit this week “will focus mostly on the implementation process of recently concluded interim EPAs, regional integration of Western Africa and business and investment environment in those countries”. Lange’s team will meet with government, parliamentarians, the private sector and civil society and NGOs during the trip. However, prior to departure, the committee posted a study on possible means of suspending EPAs with ACP states if they are deemed to break human rights, democratic principles or the rule of law, following the expiry of the Cotonou Agreement in three years time. [Download (pdf): Human rights provisions in Economic Partnership Agreements in light of the expiry of the Cotonou Agreement in 2020]
EU rejects SA’s dumping claims (Business Day)
“As we speak, there is no dumping of EU chicken in SA. If there had been, the association would have filed a complaint to the International Trade Administration Commission for dumping, as they did in the past. They have not. The South African authorities themselves acknowledge that dumping is not the issue,” the delegation said. To support its case, the EU noted that aggregate imports of EU chicken bone-in imports to SA last year did not exceed 200,000 tonnes, representing less than 10% of overall poultry consumption: “We fail to see how such a relatively moderate market share should be the main cause of the problems facing the South African industry.”
Senegal: Leveraging the potential of the services sector to support accelerated growth (World Bank)
Services play a major role in the Senegalese economy, accounting for 66% of economic activity and contributing nearly three-quarters of GDP growth between 2006 and 2013. During the period, the private sector contributed 71% of services and accounted for 84% of its contribution to growth. The dynamism of private services is driven primarily by telecommunications and financial services: while the two sub-sectors made up 21% of private services, they accounted for nearly half (48%) of the contributions of private services to growth during the period. These trends are projected to improve in the future. Available data on employment and credit confirm the critical importance of services. In 2013, over 50% of credit to the economy was devoted to services, and 55% of the labor force was employed in the services sector, including 36% of the rural workforce and as much as 80% of the urban workforce.
Tanzania: Govt committee questions proliferation of regulators (IPPMedia)
The presence of far too many government-affiliated regulatory bodies and agencies is among major factors thwarting the growth of business in the country, a special committee under the Ministry of Trade, Industries and Investments has concluded. The committee, formed late last year and comprising representatives from the ministry and private sector, as well as independent experts, says that the high fees charged by these regulatory authorities are contributing to hiking the cost of doing business in the country and blunting the competitive edge of local companies in regional trade. Presenting the draft of its blueprint on regulatory and licensing reform in Dar es Salaam yesterday, the committee’s technical leader, Dr John Mduma, said it is high time the government reviews some of its regulations so as to make it easier for people to do business.
SACU under threat as South Africa sneezes (Southern Times)
SACU member states economies are facing a major risk due to the under performance of the South African economy, economists warned here last week. Standard Chartered Bank’s head of economics (Africa), Razia Khan said 2017 was supposed to have been a year of recovery. Speaking at a global market forecast meeting in Gaborone, Khan noted that “Botswana had had been through a lot, the Southern Africa drought had weighed on prospects across the region.” Former Bank of Botswana Governor and economist, Keith Jefferis said South Africa’s neighbours would be affected by the erratic and unstable political and economic situation in that country, which he said are causing slow growth in the region. He stated that the downgrade might see investors turning away from the region, which could indirectly affect Botswana, as it is likely to cause them to turn away from Botswana itself.
A new customs tariff system, submitted to the Council of Ministers and expected to be implemented this year, proposes cuts on import duties on foodstuffs such as fruit and vegetables, cooking oils and grains (including wheat flour), as well as raw materials such as iron, steel and aluminium products as well as second-hand cars, the Angolan press reported. The aim is to replace the existing customs tariff system – introduced in 2014 before the start of the economic and financial crisis now facing the country – which is generally regarded as protectionist of local farmers and manufacturers, seeking to make imports more expensive in order to encourage diversification of an economy that is highly dependent on oil.
Zimbabwe: Zimra moves to curb transit fraud (The Herald)
The Zimbabwe Revenue Authority has started acquiring electric seals for transit break bulk cargo, mostly being carried in flat bed trailers in a move set to reduce incidents of transit fraud, an official has said. Zimra board secretary and director of Legal and Corporate Services Ms Florence Jambwa said transit fraud resulted in situations where importers declared that goods were in transit (removal in transit – RIT) to neighbouring countries, yet they would be offloaded in Zimbabwe. Ms Jambwa said as a result of such activities, the country was losing a lot of potential revenue to criminals. Ms Jambwa said Beitbridge Border Post handled an average of 200 transit vehicles per day destined for countries north of the Zambezi River, including Zambia, Malawi and the Democratic Republic of Congo.
Malawi Socio Economic Forum showcases growth prospects (BizNis Africa)
Policy certainty and an increasingly benign interest rate and macro-economic environment, “presented the best opportunity in decades to deal with the country’s now well documented youth challenges,” said Andrew Mashanda, Standard Bank Limited Malawi Chief Executive Officer. With 90% of the Malawian economy based on agriculture, food production, processing, marketing, distribution and export, Mashanda said this presented a huge opportunity to, “develop value chains and innovate youth-driven digital services and solutions harnessing agriculture for national development, skills creation, employment and global earnings.”
Tony Carroll: Barring pharmaceutical imports will not heal Africa’s economy (Business Day)
The EAC recently stated its intention to implement a plan to foster local production of drugs and protect domestic markets through high tariff walls against imports. Ethiopia has followed a similar strategy and the director of the West Africa Health Organisation recently visited Ghana to encourage newly elected President Nana Akufo-Addo to implement a local manufacturing plan. If the track record for such measures was different, I would not be so alarmed. But these measures are just another chapter in the woeful saga of African import substitution. Whether it be steel or consumer goods, the effect of import substitution has been higher prices, lower quality and the creation of economic oligarchies often utilising nefarious tools to lock up their market share. [The author is senior associate at CSIS and vice-president of Manchester Trade]
The State Statistics Institute said the deficit widened to 3.87 billion dinars ($1.67bn)for January, February and March, from 2.46 billion dinars ($1.06bn) in the same period last year. Imports in the three first months this year soared 20.3% to 11.4 billion dinars ($4.93bn). Exports rose by 7.4% to 7.5 billion dinars ($3.24bn). Tunisia wants to take advantage of the large African market to increase its exports. [Related: Tunisia says central bank to gradually weaken dinar, lift exports, Ekurhuleni Business Initiative strengthens business ties with Tunisia]
Rwanda – Djibouti trade updates: Rwanda, Djibouti sign five bilateral agreements (New Times), Rwanda, Djibouti remove visa fees for some travellers (KT Press)
Trade with Angola reached $3.489bn (+42.40%), with China selling goods worth $252m (-7.72%) and buying of $3.237bn (-48.69%). Trade with Mozambique amounted to %270m (-1.44%), with China selling products worth $164m (-10.30%) and buying goods worth $105m (+16.51%).
The economic challenges confronting state governments in the country may witness drastic reduction if the current efforts of the Nigeria Governors’ Investment Forum, to foster transnational investments, particularly between Nigeria and China are sustained. Speaking at the first edition of the event, which was held in Guangzhou, China, Vice Mayor of Guangzhou, Cai Chaolin, said Nigeria as Africa’s largest economy, and Guangdong are highly complementary to each other in areas like manufacturing, agriculture, cultural exchanges and infrastructure development. Vice Mayor of Guangzhou, Cai Chaolin was optimistic the Chinese automobile maker headquartered in Guangzhou, a subsidiary of Guangzhou Automobile Industry Group, GAC Motors would boost Nigeria’s economy through the national automotive policy.
China, India top queue for Kenya’s oil exports (Business Daily)
China and India have emerged as the main buyers of the Turkana crude oil that Kenya plans to export under a test programme beginning June, contrary to an earlier announcement that buyers had been found in Europe. Petroleum principal secretary Andrew Kamau said the first sea tankers will dock at the Mombasa port in June to pick up the consignment transported from northern Kenya by road and stored at the Mariakani refinery tanks. British oil explorer Tullow, the developer of the Turkana oilfields, has already pumped out and stored 60,000 barrels of crude in Lokichar in readiness for transportation to Mombasa. [KPA expands Nairobi dry port to boost trade] [Jaindi Kisero: Why top Chinese contractors are forging political alliances]
The Administrative Measures of the PRC Customs on Rules of Origin of Imported Goods from the Least Developed Countries Entitled to Special Preferential Tariff Treatment, which became effective 1 April, is the latest action taken by the General Administration of Customs of China to improve the administration of the origin of the import goods. The GACC made two major changes in the new measures: (i) They expanded the criteria that determine the national source of a product, allowing more products to be regarded as originating from a beneficiary country; (ii) They streamlined the consignment process, making the export process more efficient than before.
The global trade and investment are in stagnation and the multilateral trade system is being affected. Economic globalization has suffered setbacks and we have witnessed the rise of inward-looking and protectionist tendencies in some countries’ policies and the growth of “anti-globalization” thinking. International cooperation for development is faced with daunting challenges of declining political will, dwindling resources and fragmentation of efforts. Financing for development is confronted with ever greater difficulties. [UN forum highlights importance of stronger partnerships for financing sustainable development]
Today’s Quick Links:
Trade: Museveni off to Qatar
AGRF 2017 (4-8 September, Abidjan): preview