tralac’s Daily News Selection
From RECs to a Continental FTA: Strategic tools to assist negotiators and agricultural policy design in Africa (UNCTAD)
The establishment of the Continental Free Trade Area (CFTA) is gaining speed, with the African Union (AU) aiming to get the CFTA agreement in place by 2018. If fully implemented, the CFTA could increase intra-African trade significantly and promote structural transformation by providing a lever to industrial development in African economies. In this context, this report (pdf) seeks to enhance knowledge among policymakers, experts and private sector stakeholders on essential policies and measures for establishing the CFTA and boost regional supply chains in not only agricultural commodities but also processed food products.
Around 80 per cent of all intra-African trade flows through Regional Economic Communities (RECs) and 20 per cent flows outside trade agreements. Based on trade volumes, five countries play central roles in mobilizing the intra-African trade – Algeria, Côte d’Ivoire, Egypt, Nigeria, and South Africa – being responsible for 67 per cent of all intra-African traded volumes in 2015. However, the network analysis indicated that four countries in Africa represent central players in trade networks in the continent, namely South Africa, Côte d’Ivoire, Kenya and Morocco. As a result, these countries benefit from more diversified trade flows and higher proportion of intermediate and value-added products than their neighbors.
Ashly Hope: The AfCFTA is not just about the tariffs (tralac)
Trade governance in the 21st century is not just about the tariffs. Goods, services and investment are all deeply integrated, and the regulatory environment in trading countries has a significant effect on how both goods and services are traded. The lack of visibility of non-tariff barriers also perhaps means that their reduction and elimination may be more politically feasible to achieve for some members than the reduction of tariffs in very sensitive areas. While ultimately significant (90%) tariff reduction may be the goal, if tariffs on sensitive goods can give political cover for the reduction in other barriers to trade, it is likely that the net welfare gain will be higher than a scenario in which tariffs are considered to be the only game in town. If AfCFTA members treat one another not with suspicion, but act in a spirit of cooperation, the reductions of non-tariff barriers to trading on the continent could be the real advantage the AfCFTA brings to intra-African cooperation. However, eliminating unnecessary non-tariff barriers and harmonising or aligning regulations require a deeper, more nuanced kind of cooperation. Let’s hope AfCFTA members are up for the challenge. [The author is tralac Research Coordinator, trade in services and regulation]
José Graziano da Silva: Achieving zero hunger in Africa is possible
Next week in Khartoum, the UN FAO is convening the 30th Regional Conference for Africa, where African ministers and other stakeholders will meet to review the achievements, challenges and priorities regarding the sustainable development of agriculture and food systems. It is encouraging that some parts of the continent have made significant progress, but challenges remain for all. The 2017 edition of the State of Food Security and Nutrition in the World report points out that the number of undernourished people in Sub-Saharan Africa in 2016 was about 224 million, an increase of 24 million compared to the previous year. This means that 23% of the population in Sub-Saharan Africa, almost one out of four African people, was undernourished.
However, compared with the percentage of undernourishment registered in 2000 - 28% - the numbers still show a relative decrease. The increase in hunger in Sub-Saharan Africa in 2016 is directly linked to conflicts and the impacts of climate change, such as the prolonged drought that affected the rural areas of many countries. Low levels of productivity, weak value chains and high levels of vulnerability to crises have also contributed to negatively affecting food and agriculture systems and rural livelihoods, especially in relation to the poorest people. [List of documents]
Members of the East African Legislative Assembly currently conducting an on-spot assessment of EAC organs, institutions and facilities on the Central Corridor, Thursday said they were impressed by the progress to ease movement from the Tanzanian port city of Dar es Salaam to Dodoma. The lawmakers who had toured the Vigwaza Weighbridge located 80 kilometers from Dar es Salaam on Wednesday, later paid a courtesy call to the Tanzania Ministry of Foreign Affairs and East Africa Cooperation in Dodoma, where they addressed a press conference. Fatuma Ndangiza (Rwanda) told The New Times that compared to the many issues in the past, she too concurs with her colleagues that things on the route have “really improved.” MP Maryam Ussi Yahya (Tanzania) told The New Times that despite the notable improvements “NTBs (non-tariff barriers cannot be eliminated completely” as new ones keep coming up. According to Ussi, the issue of congestion at Dar port is a particular bother but the good news is that the Tanzanian government plans to revamp the port and make it an issue of the past. [UNCTAD workshop: Supporting the shift towards sustainable freight transport in the Central Corridor (27-28 February, Dar es Salaam)
Kenya: Building of Lamu port three months behind schedule (Business Daily)
Kenya is running three months behind official schedule in its effort to build East and Central Africa’s largest port at Lamu. Officials say the first of the 32 berths will be ready in June, three months after its initial timeline of March. So far, the first berth of the Lamu Port South Sudan Ethiopia Transport (Lapsset) Corridor Project in Kililana, Lamu West is only 42% complete, officials have said. Transport PS Paul Maringa and Lapsset director- general Silvester Kasuku however told journalists during a tour of the port site on Thursday that the national government is committed to ensuring a speedy construction of the entire Sh2.5 trillion project.
The Nigerian Export Promotion Council, Lagos Chamber of Commerce and Industry and regulatory agencies in the export sector such as the Nigeria Customs Service, the National Agency for Food and Drug Administration and Control have formed a committee with the aim of facilitating movement of Nigerian goods through markets in the Economic Community of West African States. During the inauguration of the committee tagged ‘Nigeria ECOWAS Export Development’, the stakeholders noted that the West African sub-region was a huge market with huge potential for growth if well harnessed by member states. [ECOWAS trade: LCCI laments lack of global outlook]
Rwanda: Gatete calls for innovative partnerships between govt and development partners (New Times)
Rwanda’s transformational agenda requires innovative partnerships engaging all stakeholders, according to the Minister for Finance and Economic Planning, Claver Gatete. He said this while opening the 14th Development Partners retreat in Rubavu District on Thursday. The minister said this with respect to delivering on the targets in the National Strategy for Transformation and Vision 2050. He emphasised the important role the private sector is playing as an engine of economic growth and urged development partners to move beyond traditional financing and consider new and innovative ways to finance the private sector. The minister’s message was echoed by both co-chairs of the Development Partners Group.
Zimbabwe revises visa regime in bid to boost tourism (The Chronicle)
The government of Zimbabwe has announced a revised visa regime which will see 29 countries being moved from Category C to Category B (visa on arrival) as the country moves in to improve travel facilitation and unlock the potential of the tourism industry. Announcing the development during the National Tourism Strategy Workshop held in Victoria Falls, Department of Immigration Principal Director Mr Clement Masango said the changes are with immediate effect and are part of government efforts to improve travel facilitation and unlock the potential of the tourism industry. [Zim sees business confidence rise: Optimism index leaps to 5.8 level]
In June 2017, the OECD Competition Committee held a Hearing that looked at whether the tools traditionally used to define markets, to assess market power and efficiencies, and to assess the effects of exclusionary conduct and vertical restraints, remain sufficient to address those questions in the context of multi-sided markets. It then invited practical methodological proposals from a range of expert economists from agencies, academia, and private practice on how these tools might need to be re-designed or re-interpreted in order to equip competition agencies with the analytical tools they require when analysing multi-sided markets.
Taxing Energy Use 2018 describes patterns of energy taxation in 42 OECD and G20 countries (representing approximately 80% of global energy use), by fuels and sectors over the 2012-2015 period. New data shows that energy taxes remain poorly aligned with the negative side effects of energy use. Taxes provide only limited incentives to reduce energy use, improve energy efficiency and drive a shift towards less harmful forms of energy. Emissions trading systems, which are not discussed in this publication, but are included in the OECD’s Effective Carbon Rates, are having little impact on this broad picture. “Comparing taxes between 2012 and 2015 yields a disconcerting result,” said OECD Secretary-General Angel Gurría. “Efforts have been made, or are underway, in several jurisdictions to apply the ‘polluter-pays’ principle, but on the whole progress towards the more effective use of taxes to cut harmful emissions is slow and piecemeal. Governments should do more and better.” In 2015, outside of road transport, 81% of emissions were untaxed, according to the report. Tax rates were below the low-end estimate of climate costs (EUR 30/tCO2) for 97% of emissions. [Taxing Energy Use 2018: South Africa (pdf)]
Sens. Gary Peters (D-Mich.) and Richard Burr (R-N.C.) are teaming up on legislation that would help businesses that typically lack enough resources to file cases against alleged trade violators. The permanent task force would fall under the the International Trade Administration at Commerce, and would be tasked with identifying and investigating trade violations such as dumping and recommending investigations with a focus on smaller businesses. “Smaller companies with limited resources may not have the ability to identify trade violations, or worse, they fear retaliation from governments in foreign markets where they sell their products,” Peters said. [Underfunding the State Department could hurt US exports — and US companies]
Today’s Quick Links:
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