tralac’s Daily News Selection
Starting tomorrow, in Dar es Salaam: SADC DFI Network bi-annual meetings
Presentations, documents: UNCTAD’s Intergovernmental Group of Experts on Consumer Protection Law and Policy (3-4 July, Geneva)
29th Summit of the African Union closes after concentrating on three major continental issues. [Related: Mauritius: AU Agenda 2063 already mainstreamed within our National Development Plan; President Adama Barrow’s speech to AU Summit]
India to assure African countries on services trade (Economic Times)
India plans to allay the fears of African countries which have dismissed its proposal for a global agreement on trade in services that includes easing travel for work across borders. African nations, led by South Africa, had red flagged India’s proposal fearing it would open the doors for e-commerce in the name of easing cross border flow of information in services. India wants to build consensus on a comprehensive agreement to ease global trade in services and the support of African countries is critical as they have been New Delhi’s traditional ally in trade negotiations.
To build robust domestic and continental supply chains and facilitate seamless flow of goods and services across Africa’s borders, the African Export-Import Bank is introducing a programme to support companies with proven intra-African trade experience and operations and with value chains spanning across countries, Bank President Dr. Benedict Oramah, has announced in Kigali. Dr Oramah said the unique group of African companies, which have been branded Intra-African Trade Champions or Intra-Champs, would receive interventions from Afreximbank that would include financing, enabling of market access and technical assistance initiatives. Kanayo Awani, MD of Afreximbank’s Intra-African Trade Initiative, highlighted the impact of multinational corporations in developed and developing economies and outlined facts about the performance of African multinational corporations, saying that those fortified the belief that the strategy for Africa’s transformation should be anchored by the continent’s “regional champions”. She noted that African multinational corporations, such as the Dangote Group, Export Trading Group, El Sewedy and MTN, had been increasingly investing across borders and contributing to growth in intra-regional investment flows.
The impact of Economic Partnership Agreements on the development of African value chains: case studies of the Kenyan dairy value chain and Namibian fisheries and horticulture value chains (ECDPM)
Overall, this analysis suggests that while EPAs provide some opportunities and pose some challenges, their direct impacts, both positive and negative, on many African value chains are likely to be limited and should not be overstated. It also suggests that although EPAs are meant to support the development of African value chains, their implementation alone (i.e. in the absence of accompanying support, for example capacity building) will not be sufficient to ensure such development occurs. If EU development partners and other actors are serious in their desire to support the development of African value chains, they should complement efforts to implement the EPAs with: [The authors: Sean Woolfrey, San Bilal]
Lawyers from around Africa gathered in Cameroon this week to call for tougher legislation against counterfeit medicine. Sixty tons of counterfeit medicine was burned after being seized by customs officials in Cameroon, who say the stockpile had an estimated value of $80,000. Customs official Marcel Kamgaing said the imitation medicine was being used to treat everything from diabetes and hypertension to cancer and erectile dysfunction. He said the forged drugs were destined for sale at shops and roadside pharmacies. Jackson Ngnie Kamga, president of the Cameroon Bar Association, says the current penalties are not enough of a deterrent. He said traffickers should face jail time.
Zambia: Oil importing companies and SADC certificates of origin (ZNBC)
Zambia’s High Commissioner to South Africa, Emmanuel Mwamba, has urged the Zambia Revenue Authority to expedite investigations concerning allegations of tax evasion by some petroleum and energy importing companies based in Zambia. Mr Mwamba says the decision by ZRA to dishonour SADC certificates of origin of oil importing companies, has created an impression that Zambia is not complying with the SADC trade protocols. Mr Mwamba was speaking at the Zambian Mission in Pretoria, when a delegation from the ZRA paid a courtesy call on him following their verification mission to South Africa for fuel imported into Zambia with SADC certificates of origin. ZRA Deputy Commissioner, Reuben Kunda said the risk of revenue leakage is high among oil importers as some are taking advantage of the SADC protocol to smuggle petroleum and energy products into Zambia.
Zimbabwe: Cooking oil industry regains capacity (NewsDay)
The cooking oil industry is operating at between 50 and 60% of capacity following import restrictions imposed by government in the past three years, an industry official has said. Oil Expressers Association of Zimbabwe president, Busisa Moyo, told NewsDay that the industry had regained capacity following import restriction measures put by government in the past three years. However, he lamented that raw material shortages on the local market were presenting a challenge, forcing the industry to import crude oils.
Ghana: Govt seeks to lighten importers’ burden (Graphic)
The Ministry of Finance wants to reduce the contribution of customs revenue to the nation’s tax revenue from 40% to 20%. The Head of Tax Policy at the Ministry of Finance, Mr Anthony Dzadzra, disclosed this in an interview on the sidelines of a forum which was organised by the American Chamber of Commerce Ghana on the country’s fees and charges for import, export and transit trade.
EAC removes waivers on ‘sensitive goods,’ imposes common tariff (The EastAfrican)
East African countries have agreed to remove the special treatment given to “sensitive goods” and impose a Common External Tariff on them starting from 1 July 2018. According to EAC countries, such preferential treatment is not anchored in the law and is stifling intra-regional trade. The region’s Council of Ministers has also resolved that goods manufactured from raw materials that are granted country-specific duty remission should attract duties, levies and other charges provided in the existing EAC-CET, effective 1 July 2017.
EAC Partner States’ 2017/18 Budget Analysis: tax changes (EABC)
In order to spur growth of industries, employment creation increased revenues and enhanced equity and fairness in tax administration, the Governments of the 4 EAC Partner States of Tanzania, Kenya, Uganda and Rwanda came up with various tax changes as follows:
Open Rwanda cargo transport for low costs, more growth (The EastAfrican)
EAC member states have to open the domestic cargo transport business to competition for costs to come down and allow growth of the logistics industry. Ring fencing the domestic cargo transport business to locals only, according to a new study, has led to underutilisation of freight capacity and compromised the competitiveness of the industry. This requires the region to amend or repeal Article 28 of Northern Corridor Transit and Transport Agreement, which restricts foreign registered trucks to transport goods on foreign markets. Uganda, Kenya and Rwanda consented to the 2007 agreement, as they sought to protect the local operators from competition. The study, commissioned by Rwanda Private Sector Federation and sponsored by TMEA, says the restriction costs Rwanda transporters about Rwf22.7bn ($27m) annually. The same restrictions apply to the Central Corridor, which means Tanzania and Kenya with bigger transit fleet could be losing about $100m each annually. But Kassim Omar, chairman Uganda Freight Forwarders/East Africa Business Council, says opening up domestic cargo business space to regional competition would edge out Uganda, Rwanda and Burundi.
Kenya: Tender billions beckon in parties infrastructure plans (Business Daily)
The high profile tenders that have dominated public sector contracts are set to continue as key political formations pledge to pump billions of shillings into transport and energy. Both the ruling Jubilee and the National Super Alliance (Nasa) have pledged to continue investment in basic infrastructure despite a subtle difference in approach. The big question is where the tender billions will come from.
Tanzania mining, industrial policy updates:
(i) Not so fast, Acacia tells Parliament as it heads to arbitrator. One day after Parliament passed new laws on natural resources, Acacia Mining which is entangled in a dispute with the government over export of gold concentrates amid tax evasion accusations yesterday served the government with notices of taking the matter to an overseas arbitrator.
(ii) No more exportation of mineral concentrates. The government has officially announced that there will be no more exportation of mineral concentrates whose smelting will henceforth take place in the country. Tabling the recommendations of the draft bill to review various laws in the National Assembly yesterday Justice and Constitutional Affairs Prof Palamaganda Kabudi said that as per the recommendations the Tanzania Minerals Audit Agency will be annulled.
(iii) Magufuli: ‘We erred in 1990s sell-offs’. President John Magufuli yesterday admitted that the country made mistakes during the privatisation process resulting in at least 197 firms to remain dormant. Launching the Sengerema Town Water Supply and Sustainable System, President Magufuli said he was putting blame on his predecessors for mistakes but that he had the right to speak about the errors and take action to correct them. Dr Magufuli emphasised that it was crucial for strategic institutions to be owned by the public. He said the 197 privatised firms have never been operational ever since they were privatised over a decade ago. At least 274 industries were privatised by 2012 as part of the structural reforms that were aimed at removing the government from engaging in business. “We privatised even strategic institutions like the railways corporation. It’s like we decided to leave each and everything to investors, which was wrong,” he emphasised. The Tanzania Railways Corporation, whose management was handed to an Indian firm, did not deliver, according to President Magufuli.
African consultation on child labour and forced labour: taking forward Alliance 8.7 in sub-Saharan Africa (ILO)
With some 3.7 million victims of forced labour and 59 million children aged 5-17 years in child labour, the African continent needs to urgently operationalize Alliance 8.7 to achieve the set targets of combating effectively these scourges, said high-level participants to the regional dialogue held in Addis Ababa. The AU pledged for a regional initiative in collaboration with the ILO as well as involving other key development partners such as the UNICEF, to eliminate child labour in the continent by 2025. [Downloads: keynote speeches]
Importing an export problem: India is becoming a high cost economy in agro-related items (Financial Express)
There is a rise of 30% in value of imports of three essential agro items, namely wheat, pulses, vegetable/edible oils—indicative of substantive demand pull in the country (see accompanying graph). Data analysis of India’s seven select but vital agro-related items of exports reveals that there is a sharp slump - 40% in their overall value - during last four years. Commodities are wheat, rice, sugar, cotton, soy meal, guar gum and beef and fish.
Purchase of vehicles run on fossil fuel will stop completely by 2030, according to a study by Tony Seba, an economist with Stanford University. Reason: Seba believes that electrification and transport as a service will sweep across transportation industry. In his report, Rethinking Transportation 2020-2030 (pdf), which is the talk of board room meetings in the auto industry and green energy enthusiasts, Seba said that some of the key stakeholders will face sudden demise. “We are on the cusp of one of the fastest, deepest, most consequential disruptions of transportation in history,” Seba said.
Today’s Quick Links:
Stratfor Worldview: South Africa prioritizes populism at the cost of competitiveness
UN Working Group on Business and Human Rights: 10 key recommendations to governments, businesses (pdf)
South Sudan: Economic chaos fuels gold mining rush