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tralac’s Daily News Selection

tralac’s Daily News Selection
Photo credit: Simon Dawson | Bloomberg

25 Jan 2018

The Executive Council of the African Union officially opened today: download the speeches by H.E. Moussa Faki Mahamat (Chairperson of the AUC) and Ms Vera Songwe (Executive Secretary of the UNECA)

Botswana to sign Tripartite Free Trade Area Agreement (30 January)

New estimates for direction of trade statistics (IMF)

In March 2017, the IMF published an upgrade of its Direction of Trade Statistics (DOTS) dataset. This paper documents the new methodology that has been developed to estimate missing observations of bilateral trade statistics on a monthly basis. The new estimation procedure is founded on a benchmarking method that produces monthly estimates based on official trade statistics by partner country reported at different times and frequencies. In this paper we describe the new estimation methodology. Additional data sources have also been incorporated. We also assess the impact of the new estimates on trade measurement in DOTS at global, regional, and country-specific levels. Finally, we suggest some developments of DOTS to strengthen its relevance for IMF bilateral and multilateral surveillance.

How to stop Africa’s new rising debt from turning into a tragedy (Devex)

At present there are no internationally agreed mechanisms for vital issues such as transparency in issuing new debt, and for fair and transparent arbitration mechanisms if a country defaults. The consequences of these challenges are therefore twofold. First, countries can take on debt under opaque circumstances, as recent cases in Mozambique and Congo have illustrated. Second, if a country does default, it is vulnerable to unfavorable restructuring terms that can allow the private sector to profit from its debt crisis, as happened in Argentina. Perhaps a little late, the IMF has updated their Debt Sustainability Framework to reflect new risks for use in 2018. Improved transparency for debt sustainability was at the top of the agenda for the IMF, G-20, and U.N. Conference on Trade and Development in 2017, yet no country took the lead to form a compact. Commercial lenders have been the ones to act, with Credit Suisse initiating a Transparent Lending Covenant, under which banks will voluntarily disclose lending information online. While this is a welcome positive step, it is not enough. The opportunity is three-fold: [The author, Fiona Robertson, is a policy officer for development finance at the ONE Campaign]

2018 Agility Emerging Markets Logistics Index: logistics executives see big year ahead for emerging markets (Agility)

In Agility’s annual survey of more than 500 supply chain industry professionals, nearly two-thirds agree with the International Monetary Fund’s 2018 emerging markets forecast of 4.8%-4.9% GDP growth. That would mark the fastest expansion for emerging markets since 2013 and a second consecutive year of higher growth for developing economies, which have slowed dramatically since a 7.4% GDP gain in 2010. The survey of global logistics executives is part of the 2018 Agility Emerging Markets Logistics Index, an annual snapshot of industry sentiment and ranking of the world’s 50 leading emerging markets by size, infrastructure, transport connections and business climate. The rankings of the top four markets – China, India, UAE and Malaysia – remained the same year-on-year. Egypt surges six spots to No. 14 — the largest jump by any country in the 2018 Index – and rockets up 26 places to No. 21 in the separate category ranking countries’ business conditions, or Market Compatibility. Bangladesh (23) and Uruguay (25) both leapfrogged four spots in the overall rankings. Nigeria, Africa’s largest economy, tumbled to No. 31 from No. 24 a year ago. In spite of its potential, Nigeria ranks next-to-last in infrastructure and transport connections, or Market Connectedness, and 46th in business climate. South Africa dropped three places, to 24. [Transport is not gender-neutral]

Mauritius Maritime Week 2018: Mauritius geared to become a key maritime hub in the Indian Ocean, says PM (GoM)

Government is determined to have world class transportation systems, logistics and facilities for the sustainable growth of Mauritian economy. To this end, it is investing massively for the infrastructural development of the Port Louis Harbour into a preferred maritime hub offering a spectrum of associated services in the Indian Ocean. The Mauritius Maritime Week, the Prime Minister underlined, is set to showcase the Port-Louis Harbour as an integrated platform for five main sectors, namely, container transhipment, bunkering, cruise tourism, seafood and ancillary port services. With regards to the quay extension project, Prime Minister Jugnauth recalled that it has enabled to position Mauritius as a full-fledged transhipment hub and major shipping lines have already expressed their interest to increase their container transhipment volumes.

Regional carbon pricing for international maritime transport: challenges and opportunities for global geographical coverage (World Bank)

This paper compares the relative performance of various regional measures for carbon pricing based on the following criteria: jurisdictional basis, data availability, environmental effectiveness and avoidance strategies, impact on competitiveness, differentiation for developing countries, and incentives for reaching a global agreement. The main finding is that, if carefully designed, a cargo-based measure that covers the emissions released throughout the whole voyage to the cargo destination presents various advantages compared with other carbon pricing schemes. These advantages have been largely ignored in the literature. [World’s first electric container barges to sail from European ports this summer]

Kenya-East Africa: UK to inject Sh30bn to ease cross-border trade (The Star)

The UK government is set to inject £211 million (Sh30 billion) to support the second phase of infrastructure projects in measures to ease cross-border trade between Kenya and her neighbours. Mordaunt pledged £60 million (Sh 8.7 bn) to fund sustainable urban economic development partnership in 10 rapidly growing towns in Kenya. The money will go towards urban economic planning, investment climate reforms and attracting private sector investment. UK has also invested £8 million (sh 1.16 billion) through the World Bank to assist the Government of Kenya in the development of more Special Economic Zones, private-public partnerships and select counties on doing business reforms.

An international framework for eco-industrial parks (UNIDO)

Published jointly by the World Bank Group, UNIDO, and GIZ, the framework recognizes the growing importance of what are variously called industrial parks or areas, special economic zones, and export processing zones. While these zones deliver important economic benefits, they also have the potential to concentrate negative environmental and social impacts, such as pollution, greenhouse gas emissions and poor labour standards. Developing and emerging economies seeking to increase industrial output need to decouple economic growth from environmental and resource inefficiency to meet wider social objectives. Eco-industrial parks, or EIPs, can create a more sustainable operating environment for firms to compete, and create jobs through efficient use of resources and greater productivity, while also enabling investors to achieve their social responsibility goals. Extract:

There are currently a number of complementary tools and processes to assist governments and industrial park stakeholders to progress in the implementation of inclusive and sustainable industrial development. However, a consolidated and targeted framework for EIPs is largely lacking at the international level. Countries and industrial park stakeholders are increasingly requesting “standards” or benchmarks for ensuring that envisioned industrial developments are sustainable and meet the spirit of an EIP. An innovative approach is to set “minimum requirements” or “sustainability performance standards” for industrial parks, covering legal compliance as well as socio-economic, environmental, and management aspects. Such standards provide benchmarks for assessing existing industrial parks, planning retrofitting measures for existing parks, or better planning new industrial parks with the end goal of driving inclusive and sustainable industrialization.

PwC’s 21st CEO Survey

Despite record levels of short-term optimism in the global economy, CEOs worldwide report heightened levels of anxiety regarding the business, economic, and, particularly, the societal threats confronting their organisations. PwC’s 21st CEO Survey sheds light on this seeming contradiction and the factors contributing to CEOs’ anxiously optimistic outlook on 2018 and beyond. Extract:

The record jump in positivity with regard to global economic growth does not translate into an equivalent leap in confidence in their own organisation’s 12-month prospects, however. Regionally, it’s a mixed bag with North America, Latin America, Central and Eastern Europe, and Asia-Pacific reporting higher levels of ‘very confident’, and the rest of the world moving in the opposite direction. Still, North America is the only region where a majority of CEOs demonstrate the highest possible level of confidence in their company’s revenue growth prospects over the next 12 months. This divide is quite striking. While the rest of the world is cautiously optimistic, North American CEOs have never been more sure of their company’s near-term prospects. Just last year, only 39% reported that they were ‘very confident’; that figure jumps to 53% this year. The last time North American CEOs were this exuberant was in 2007, the year before the global financial crisis. When we look at the geographic markets CEOs are turning to for growth, again, North America, specifically the United States, tops the chart; 46% of global CEOs consider it one of the three most important countries for growth, followed by China at 33%. Germany strengthens its hold on third place, with one in five CEOs considering it an important growth market. [South Africa CEO survey: The biggest threats to growth in South Africa]

Bring human rights to discussion tables and into decisions at Davos, UN experts urge

In particular, the experts underscored the need for Governments and businesses to act in accordance with the UN Guiding Principles on Business and Human Rights by respecting the rights of workers across supply chains and avoid business operations that cause or contribute to adverse human rights impacts. The Working Group on Business and Human Rights was established by the Geneva-based Human Rights Council in 2011.

JPMorgan plans expansion into Ghana and Kenya (Business Daily)

JPMorgan Chase & Co plans to expand its African presence into countries including Ghana and Kenya, Chief Executive Jamie Dimon said in an interview on Wednesday. “You’ll see us open in some countries we are not in, in Africa you’ll be hearing about some of that stuff,” Dimon told Bloomberg Television on the sidelines of the World Economic Forum meeting in Davos, Switzerland.

Achieving universal and affordable Internet in least developed countries (ITU)

The world’s least developed countries are narrowing ‘digital divide,’ and with millions of people now taking advantage of smart phones and other digital devices, keeping up this momentum can put their societies on the fast track to sustainable development, the UN said on Wednesday. This report (pdf) provides insights into the great strides that LDCs have made in regard to information and communication technology access, and the opportunities that ICTs offer in addressing severe structural impediments to sustainable development in this group of countries. By the end of 2017, the number of mobile-cellular subscriptions is expected to increase to about 700 million, with a penetration of 70%. Currently, more than four out of five people in the LDCs have access to a mobile-cellular network. ICTs have led to significant development outcomes in LDCs, in particular in the areas of financial inclusion, poverty reduction and improved health. This report shows that LDCs have also made great progress towards achieving universal access to and affordability of the Internet. Several LDCs are also on track to largely achieve SDG Target 9.c by 2020. In 2016, close to 60% of the population in LDCs was covered by a mobile broadband network and, in a growing number of LDCs, mobile broadband services have become relatively affordable. At the same time the report highlights some variations among the LDCs.

Today’s Quick Links:

WAEMU: IMF conclude 2018 discussions on common policies for member countries

Rwanda makes progress in implementing the Malabo Declaration

Ethiopia vows to support AU’s single African air transport market

What it means for Rwanda to gain global certification powers

SADC in 2018: consolidating stability and sustainable development

2018 Environmental Performance Index: summary

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This post has been sourced on behalf of tralac and disseminated to enhance trade policy knowledge and debate. It is distributed to recipients across Africa and internationally, serving in the AU, RECs, national government trade departments and research and development agencies.

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