News
tralac’s Daily News Selection
Featured infographics from tralac’s latest resource page: (i) South Africa’s trade relationship with Africa, (ii) US – Africa trade profile 2010-2016, (iii) Africa’s used clothing imports
Infographics from the IMF: Your favourite five charts
Trade event pointers:
(i) Underway, in Kigali: 41st Annual World Tourism Summit (organised by the Corporate Council on Africa and Africa Travel Association in collaboration with the Rwanda Development Board)
(ii) Pan African Chamber of Commerce and Industry: The CFTA - exploring possibilities for business engagement across Africa (12-13 September, Accra; hosted in collaboration with the AUC and the UNECA’s ATPC)
(iii) 3rd AU Customs Experts Trade Facilitation Forum: the major outcome of this meeting will be a set of recommendations and observations on how African Union Member States can best implement both the BIAT as well as the WTO TFA. (20-22 September, Port Louis)
(iv) GIZ Network for Economic Development: Shaping African economies for inclusive growth (25-27 September, Windhoek)
(v) 10th Session of the Committee on Regional Cooperation and Integration: Implementation of the Continental Free Trade Area and shared gains (31 October - 2 November, Addis Ababa). Draft Aide Memoire (pdf): Progress reports and presentations will cover the following areas (p10); Side events during the 10th Session of the CRCI (p10-11); Proposed agenda (p14)
(vi) A reminder, from @AUTradeIndustry: The second week of the 3rd Continental Free Trade Area Technical Working Groups kicked off yesterday in Durban, South Africa
3rd Cycle of the CFTA Technical Working Groups: opening remarks by Ambassador Chiedu Osakwe (Chairman of the NF-CFTA, Chairman of the Technical Working Group for Trade in Services)
A question that has hung over the CFTA negotiations is African population growth and associated pressures, in relation to GDP growth. Concluding the CFTA would provide a boost for accelerated growth and modernization of Africa’s economy and increasing employment opportunities for the millions of African entering the job market. There is a population crisis impacting poverty reduction and the prosperity levels in African economies. Currently, 1bn people, approximately, or 13% of the world’s population, live in sub-Saharan Africa. John May and Hans Groth have sounded a timely alarm in their recent book: ‘Africa’s population: in search of a demographic dividend’. According to recent projections by the UN Population Division, 4bn people (or 36% of the world’s population) could live in the Africa region by 2100. In other words, this projection would more than double the current population of the continent, standing at approximately 1.2bn.
As trade negotiators, we have a collective obligation to situate the CFTA negotiations in a broader economic context. The overriding obligation for us, as trade negotiators, is for job creation and higher levels of prosperity to mitigate and overcome the pressures of the population crisis. According to the International Monetary Fund, Africa would require between 18m and 20m new jobs - approximately the size of the populations of either Mali or Niger, over the next 25 years, to respond to the job pressures, on the Continent. These are the stakes for us, as negotiators, in the CFTA. In conclusion, although we must get the CFTA right and not gloss over technical details, we must now approach it with a greater sense of urgency of the pressures of population growth and jobs that face Africa. [Delivered on 21 August, Durban)
Regional Dialogue Conference on WTO Accessions: Kenya says Horn of Africa states’ accession to the WTO to boost economy (Xinhua)
Kenya’s GDP will expand by at least 10% if all the Horn of Africa states join the WTO, a senior Kenyan government official said on Monday. Amina Mohamed, Cabinet Secretary for Foreign Affairs told a media briefing in Nairobi that by acceding to the global trade body, Ethiopia, Somalia, Sudan and South Sudan will be required to open their economies to international trade. “We therefore anticipate that Kenya will benefit from more crossborder trade and hence its economy could expand by at least 10%,” Mohamed said (pdf) during the opening ceremony of the First Regional Dialogue on WTO accessions. The three-day forum aims to mobilize support for facilitating and accelerating African accessions to the WTO. [Africa and the multilateral trading system: presentation by Ambassador Stephen Karau (pdf)]
West Africa: Impact of administrative barriers on time and cost to trade in West Africa (West Africa Trade and Investment Hub)
Despite an abundance of anecdotes, little data existed to quantify these bureaucratic hassles - which could then determine the time and cost savings due to their elimination. In 2017, the Trade Hub undertook a wide-ranging survey to generate evidence on these questions, fanning out to 20 trading centres and border crossings in eight countries within the ECOWAS region. Survey teams randomly selected and interviewed a total of 290 traders, freight forwarders, and drivers who buy and sell 15 common agricultural and livestock products. All were asked how often they were asked for a COO and phyto- or zoosanitary certificates - and how much time and money they spent to get them. Unsurprisingly for such a large area, responses ran the gamut, from no time and cost spent to multiple days and hundreds of dollars. Yet the averages show that traders are spending significant time and money on these obsolete requirements, costs they in turn pass on to consumers.
Traders said they were required to obtain a COO more than half of the time, which took them an average of 15 hours and cost an average $41.74. Agricultural product traders said they were required to obtain duplicate phytosanitary certificates more than a quarter of the time, which took an average of nearly 13 hours and costs an average $68.28. Livestock traders are asked to obtain duplicate zoosanitary certificates more than half the time, taking an average of just under 19 hours and costing an average $57.76. [Download the study, pdf]
Paul Nugent: When is a Road a Corridor? Reflections from the Abidjan-Lagos Corridor (bordersandwine)
In the case of small-scale traders, it is questionable whether there is a corridor at all. There are a series of inter-connected roads with markets at either end, but the experience of travelling along it is one of fracture and discontinuity. Even large-scale traders and transporters experience ABLAG in a manner which seems to suggest a flow that is uneven and broken into discrete segments. One wonders how many vehicles would ever begin a journey in Abidjan and end it in Lagos. On this particular road trip, I never came across a single vehicle from Côte d’Ivoire heading to or from the direction of Nigeria. The fact that transporting goods between Mombasa and Kigali is routine suggests that there is an underlying problem along the ABLAG corridor that has largely been resolved in East Africa. Translating the rhetoric of regional integration into the functioning of a genuine corridor from Abidjan to Lagos is still a long way off. Governments are forced to deal with their own domestic lobbies – including manufacturers, transport unions and officials on the ground – but the fundamental problem still seems to reside in a lack of political will. And the problem is that, like traffic along the corridor itself, the most cumbersome vehicle dictates the pace of the journey.
Rwanda-Tanzania private sector in fresh effort to boost bilateral trade (New Times)
Rwandan and Tanzanian private sector bodies on Monday reiterated their commitment to collaborate in advocating for elimination of Non-Tariff Barriers (NTBs) between the two countries. A 15-man delegation represented the Tanzania Private Sector Foundation (TPSF) at the meeting whose objectives included identifying policy and regulatory restrictions that undermine free movement of goods, services, capital and investment between the two countries, besides identifying reasonable response measures. Gili Teri, the TPSF Director of Policy, Research and Lobbying, said there are “joint challenges” too, including non-harmonised road user charges or road tolls. “This brings about a difference in charges when transporting to different regions hence varying costs,” Teri said, also noting that there are numerous monetary charges required by various agencies in the EAC Partner States for exports of milk and other dairy products. Further still, Teri said, border management institutions’ working hours are not harmonised and this is costly to business.
Tanzania official says formerly dormant industries to create over 1m jobs after revival (Xinhua)
More than 1m Tanzanians will be employed by 25 formerly dormant industries to be reclaimed by the government after their revival, an official said on Saturday. The revival of the industries that were reclaimed after investors failed to develop them for over 20 years will be jointly funded by the country’s social security funds, said Meshack Bandawe, secretary of the Tanzania Social Security Association. Bandawe said TSSA will team up with the National Health Insurance Fund, the Parastatal Pensions Fund, the National Social Security Fund , the Workers Compensation Fund and the Zanzibar Social Security Fund to invest in the reclaimed industries. Bandawe said feasibility studies for 15 industries have been completed, while studies on the other 10 industries will be completed within a short time. “We have started to implement some of the projects. Our target is to ensure that all the factories become operative before 2019,” said Bandawe.
Kenya Revenue Authority raises taxes on used Mercedes, Mazda imports (Business Daily)
The Kenya Revenue Authority has rebased its taxation of used car imports, raising the duty payable on prices of some Mercedes and Mazda models by more than 50%. The higher taxes will in turn increase the prices of the models by between Sh145,000 and Sh364,000, according to the Kenya Auto Bazaar Association (KABA) which represents second-hand car dealers.
Nigeria to establish commodities’ certification centres – Ogbeh (Premium Times)
The Minister of Agriculture, Audu Ogbeh, said the federal government will soon establish commodities’ certification centres across the six geo-political zones to aid certification and standardisation. Mr Ogbeh made the disclosure in Kano on Monday during the flag-off of the nationwide advocacy on agricultural quality control and standardization. He said that the country received 48 notifications between July 2016 and June 2017 from EU on export goods due to aflatoxin and many other contaminants either biological or chemical. “We will establish commodities certification centres across the zones to aid certification, standardisation and traceability. “The ban on dry beans from Nigerian origin by EU therefore geared our attention to what is an eye opener that we have actually been consuming poison unknowingly,” he said.
