tralac’s Daily News Selection
Five trade and infrastructure events – from Arusha to Tianjin:
The EALA has resumed its sitting in Arusha (until 6 October). Key agenda items include the East African Community Statistics Bill, 2017 and the EAC Customs Management (Amendment Bill) (No 2), 2017.
Starting tomorrow, in Juba: EAC experts meeting to consider the draft Cooperation agreement on investment facilitation. And: a list of other EAC events taking place this week
Outperformers: High-growth emerging economies and the companies that propel them (McKinsey Global Institute)
Across the varied global landscape, we can identify some individual countries that are aspiring newcomers to our list of outperformers. These are countries that are putting in place and strengthening their economic fundamentals, in accordance with the elements of our heat map. Some of them are already achieving GDP per capita growth that exceeded 3.5% in 2011 to 2016. Five countries - Bangladesh, Bolivia, Philippines, Rwanda, and Sri Lanka - have exceeded the 3.5% annual per capita growth rate in 2011 to 2016 and also rank in the top 25% of our performance index.
A second cluster of countries consists of Kenya, Mozambique, Paraguay, Senegal, and Tanzania. These countries have moved into the top quartile of our economic performance scores, reflecting improvement in key productivity, income, and demand drivers, but they have not yet achieved consistent 3.5% GDP per capita growth. Finally, two other countries achieve the 3.5% GDP growth benchmark, but their economic performance is less stellar, which puts them in the second quartile. They are the Republic of Côte d’Ivoire and Dominican Republic (Exhibit 5).
Kenya bans importation of rice from Tanzania (The Citizen)
The government revealed on Saturday that Kenya has stopped importation of rice from Tanzania in yet another sign of unending trade wars between the two largest economies in East Africa. The permanent secretary in the ministry of Foreign Affairs and International Cooperation, Prof Adolph Mkenda, told The Citizen that the Kenyan government stopped the importation of rice from Tanzania over claims of standards and packaging. “We are seeking an explanation [on the ban],” said Prof Mkenda. “We are sure that these are negotiable issues and it is our best belief that they are resolvable.” Apart from rice, there are also other issues that the government of Tanzania is trying to sort out with its Kenyan counterpart. One is that which involves the 15 lorries carrying wheat flour, which are stranded at the Namanga border post. The trucks were stopped to pass through the border following the decision by Kenyan authorities to ask the owner to clear each lorry afresh. This is despite the fact that the owner had already cleared 85 lorries, including those stuck at the border, which were bound various cities of Kenya. The other issue, according to Prof Mkenda, is that involving Bakhresa’s energy drinks product, which the Kenyan authorities overvalue them in contrast to the exact value indicated by the producer. This has made the product to be unfairly taxed by the Kenyan taxman and cause unnecessary inconvenience to
The EAC Gender Policy, which was launched today at the EAC Headquarters, in Arusha, Tanzania, has been developed to provide guidance on institutionalizing gender strategies in the EAC integration process in addition to ensuring that the rights of women and men, boys and girls are promoted, protected and realised on an equal basis. The policy further aims at strengthening the mainstreaming of gender concerns in the planning and budgetary processes of all sectors in the EAC Organs, Institutions and Partner States.
EAC industrialization and SMEs: SCTIFI concludes (EAC)
The Extra Ordinary Sectoral Council on Trade, Industry, Finance and Investment dedicated to Industrialization and Small Medium Enterprises (SCTIFI) has concluded at the EAC Headquarters in Arusha, at the level of the Permanent/Principal Secretaries. The extra-ordinary dedicated SCTIFI was convened to discuss industrialization matters in the community which has become a major agenda for the EAC Heads of State Summit. Agenda items included: the EAC Automotive Industry Action Plan and Draft Concept note on the local assembly/manufacture of affordable vehicles; Establishment of a Regional Automotive Industry Council/Platform of East Africa (AICEA); Concept Note on the manufacture/production of Low Cost Vehicles (Affordable Vehicles) in the Region and Age Limit for imported Used Vehicles.
ECOWAS Fiscal Transition Programme: update
The ECOWAS Commission is training member states in fiscal forecasting and revenue mobilization. The workshop, organized by ECOWAS Commission was held last week in Abuja, to develop capacities in the Quasi-accounting model for revenue administrators from ECOWAS Member States, UEMOA as well as the academia. The ECOWAS Fiscal Transition Programme was developed to assist member states maximize the positive effects of regional integration and minimize the negative effects of tax competition in the emerging customs union within the Community. This programme has six priority intervention areas.
Trade Mark East Africa and COMESA have opened a new chapter of cooperation on regional integration programmes following a high-level meeting between the parties, held on 10 September. The two parties agreed to explore closer partnership in four key areas of trade facilitation, development of transport corridors and improvements in logistics, industrialization and promotion of small scale cross-border traders particularly with focus on women and the youth among COMESA Member States by addressing prevailing constraints especially along the borders.
South Africa: Illicit goods amounts to almost 10% of GDP (City Press)
Sectoral Ministerial event outcomes:
G20 Trade and Investment Ministerial: statement
We welcomed the inventory of national experiences, programs, policies and practices on trade and investment aspects of agro-food GVCs. We also welcomed the discussion of key factors for G20 trade and investment policy-making options to support the participation and increasing value-addition in agro-food GVCs, which can particularly benefit developing countries. National policies to support Micro, Small and Medium-Sized Enterprises, and women are also important.
We welcomed the inventory of national experiences, programs, policies and practices on trade and investment aspects of the New Industrial Revolution. We also welcomed the discussion of factors for G20 policy-making options to face the challenges and take advantage of the opportunities that the NIR poses for trade and investment flows, with particular attention to the situation of MSMEs, developing countries and women, thereby contributing to bridge all forms of digital divide.
4th BRICS Communication Ministerial: Declaration
Ministers remained aware of the unique position that BRICS members have and the competitive advantages in particular areas of the Fourth Industrial Revolution. Therefore, Ministers agreed, inter alia, to:
Support the commencement of the full operationalisation of Partnership on New Industrial Revolution (PartNIR), and agree with the setting up of an advisory group, comprising of the appropriate ministries, to develop, as a first step, the terms of reference and a work plan aligned with the Fourth Industrial Revolution priorities, to be submitted to the BRICS Chair. The PartNIR aims at deepening BRICS cooperation in digitalisation, industrialisation, innovation, inclusiveness and investment, to maximise the opportunities and address the challenges arising from the Fourth Industrial Revolution.
After Friday’s measures to increase capital inflows to check a falling rupee and curb the rising current account deficit, the next in line could be trade-related measures to curb non-essential imports and boost exports. On Friday, finance minister Arun Jaitley said a broad policy decision has been made to take necessary steps to cut non-essential imports and increase exports, in the backdrop of the CAD touching 2.4% in the June quarter. “The items will be identified in consultation with the line ministries in the next few days and necessary decisions will be taken. We will also keep in mind that the decisions are WTO-compliant,” he said. Among non-essential items, imports of gold and electronic goods have picked up significantly in recent months.
Last week, Canada circulated a nine-page draft discussion paper called Strengthening and Modernising the WTO, almost on the lines of the EU’s non-paper. Canada, which is facing sustained heat from its neighbour US in the ongoing NAFTA-revamp negotiations, has gone a step further than Brussels by proposing to convene a ministerial meeting of 13 countries next month (24-25 October) in Ottawa. The 13 countries that will take part in the Ottawa meeting include the EU, Japan, Canada, Switzerland, Norway, Australia, New Zealand, Singapore, South Korea, Brazil, Chile, Mexico and Kenya. [China’s deal on investment facilitation runs into WTO roadblock]
Monday’s Quick Links:
Jihan Chara: The tale of Morocco in ECOWAS
Zambia to establish mechanism to address COMESA Peace and Prosperity Index
Zambia-China: an intricate relationship
UK imported £23bn worth of food in first six months of 2018