tralac’s Daily News Selection
The Canada-Africa Chamber of Business, Accelerating Africa conference, began today in Toronto
Starting tomorrow, in Kigali: The 2018 Mid-Term Review of the African Development Fund
Update on the Pan-African Private Sector Trade and Investment Committee: Nigeria’s Professor Patrick Utomi, founder of the Centre for Value in Leadership, has been elected as the first Chair-person of PAFTRAC, for a two-year term. He will be supported by vice-chairpersons drawn from different regions.
Carlos Lopes: The untapped potential of EU-Africa trade (Project Syndicate)
But what about Africa? The continent’s trade with the EU is already massive: together, African countries represent the EU’s third-largest trading partner, after the United States and China, accounting for nearly 7% of total extra-EU trade in goods, including 7% of imports and 8% of exports. And though the EU ran a persistent trade deficit with Africa in 2000-2014, it ran a €22bn ($25.5bn) surplus in 2015 and a €22.7bn surplus in 2016. Africa’s trade with the EU is triple that of, say, Canada, which amounted to €94.7bn in 2016. With the Comprehensive Economic and Trade Agreement, annual EU-Canada trade is expected to increase by at least 8%, or some €12bn. But that is still the equivalent of just half the EU’s trade volume with Egypt alone. Similarly, the EU’s future free-trade agreement with New Zealand agreement could increase bilateral trade by about 36%, yet that increase would still amount to less than half the volume of goods that the EU now trades with Tunisia. In the case of Australia, the expected increase of around one-third in trade volume represents the bulk of trade with Egypt. Africa’s share of EU trade could increase even further, given the continent’s impressive economic prospects.
France seeks to boost trade ties with Africa: the Ambition Africa conference closes today (RFI)
French and African business leaders gathered in Paris on Monday for a two-day conference to explore new opportunities with Africa, amid intense competition from China and a host of other countries. However, France’s hopes for greater trade ties are still being hindered by negative perceptions of the African continent. Finding common ground to iron out some of these misunderstandings and ensure France becomes a hub for Africa, was one of the primary aims of Monday’s Ambition Africa conference held at the French Finance Ministry. Yet this keen interest in the African continent contrasts with France’s indifference a decade ago.
“French companies left,” points out Mossadeck Bally, CEO of Azalaihotels, a chain of 5 star hotels across the continent. “They thought that the continent didn’t have a future.” Now, they’re coming back, but to a very different landscape. “The continent is open for business. But if they [France] come back, they will have to adjust, because today you have African business entrepreneurs who are very savvy investors. And you also have investors from China, India, Turkey, Portugal, Brazil, the whole world now is looking towards Africa, because it’s the last frontier.” [Ambition Africa 2018: Green economy at the centre of Africa-France business event; AFD Group launches large-scale programme, Transforming financial systems for climate: a total of 17 developing and emerging countries will benefit from this support, with a strong focus on Africa]
The impact of your work in this body is multiplied by your dual role as members of your respective national legislatures. We count on you to be strong advocates for African integration. More specifically, I would like to ask for your support for the speedy ratification of the AfCFTA agreement, the Protocol on the Free Movement of Persons, and other key pillars of Agenda 2063. The entry into force of these historic compacts will do more than almost anything else to accelerate economic growth and shatter outdated perceptions of our continent. We cannot afford to squander the momentum we have gained. But we need your help to communicate more effectively with constituents and stakeholders in civil society about the importance of these agreements for the well-being of our citizens and our economies.
President Buhari inaugurates Committee for Impact and Readiness Assessment of the African Continental Free Trade Area
For those of you who are in business, I am sure you will all agree that Africa’s trading landscape, as it stands, is multifaceted. For us in Nigeria, our vision for intra-Africa trade is for the free movement of “made in Africa goods”. This means the goods and services must have significant African content in terms of raw materials and value addition to the production and service processes. Therefore, the Continental Free Trade Area must be packaged and implemented to achieve this vision. This is the only way the majority of Africans will positively benefit from it. We cannot go back to the days of signing agreements without understanding and planning for the consequences of such actions. And our country being the worse off. Your task as members of the AfCFTA Impact and Readiness Assessment Committee is to address the issues raised during the nationwide stakeholder consultations on the AfCFTA. You are expected to develop short, medium and long-term measures that will address any challenges arising therefrom. I look forward to receiving from you in 12 weeks, a clear roadmap for Nigeria as it relates to the AfCFTA.
South Africa-United Arab Emirates Joint Commission: communiqué (Dirco)
Sub-Committee 1: Economic, trade and investment cooperation. The UAE side requested for progress on the Bilateral Investment Treaty, which was initialed by both sides in 2007. The South African side provided a background on its investment policy reforms and agreed to provide the UAE with the Protection of Investment Act, 2015 (Act No. 22 of 2015) and the subordinate legislation on the Regulations on Mediation Rules. The South African side agreed to hold technical discussions in the UAE during November 2018. The dates will be communicated and confirmed through diplomatic channels. The South African side is keen to look into the modalities of the creation of a Special Investment Fund in light of the $10bn that was announced by the United Arab Emirates during the State Visit of President Ramaphosa.
tralacBlog: Zimbabwe ratifies the WTO Trade Facilitation Agreement – what does this mean for Zimbabwe?
On 17 October 2018, Zimbabwe deposited with the WTO Secretariat its instrument of ratification of the WTO Trade Facilitation Agreement, becoming the 139th (and 31st African) WTO Member State to ratify the Agreement. Extract: Ultimately, Zimbabwe would have to implement all the provisions of the TFA. The country is said to have notified its Category B and C provisions, but the information is not yet recorded on the TFA Facility Notification List updated on 15 October 2018. [The author: tralac’s Talkmore Chidede]
The last two weeks have seen a dramatic collapse in confidence in the RTGS (real-time gross settlement) currency and spiralling parallel market exchange rates. The uncertainty over the value of RTGS has led to some businesses closing and others refusing RTGS money. Businesses are preferring to hold onto their stock whilst awaiting clarification on the value of RTGS. We have also seen the prices of commodities increasing in the market even where the producers have not increased prices. We note that this is a result of the imbalance between RTGS and Nostro accounts driven by the fiscal deficit and its financing through the creation of RTGS money. We recognise that any turnaround measures should start by addressing the fiscal deficit. We welcome the following measures as highlighted in the Transitional Stabilisation Programme and implore government to implement these immediately: [Note: Various downloads available]
Tanzania: TPSF set to conduct major public private dialogue (IPPMedia)
The Tanzania Private Sector Foundation is set to hold major national public dialogue that will bring together key state and private sector leaders to discuss the sector’s contribution to the country’s economic growth. To be organized collaboratively with the Tanzania Chamber of Commerce, Industry and Agriculture, the dialogue, set for 4 December this year, also aims to bring to light major challenges thwarting private sector and its impact to the development of the national economy. [Low prices fuel coffee smuggling to neighbouring countries]
Kenya: How private sugar millers flourish as public factories squirm in debt (Business Daily)
Re-thinking how we manufacture industrial products and deal with them at the end of their useful life could provide breakthrough environmental, social and economic benefits, according to new research from the International Resource Panel. If products were re-manufactured, comprehensively re-furbished, repaired and directly re-used, the amount of new material needed could be significantly reduced – by 80-98% for re-manufacturing, 82-99% for comprehensive refurbishing, and 94-99% for repair. The report, released at the World Circular Economy Forum, says the adoption of these “value-retention processes” could also reduce greenhouse gas emissions in some sectors by 79 to 99%. These sectors examined in the report are automotive parts, heavy-duty offload machinery (for example, diggers and excavators), and industrial printing equipment. But there is significant potential beyond these sectors for further reductions. [Various downloads available]
Rebooting a digital solution to trade finance (Associated Press)
A new report from Bain & Company and HSBC, Rebooting a digital solution to trade finance, finds that blockchain could increase global trade volumes by $1.1 trillion by 2026, off the current base of $16 trillion. Additionally, blockchain-based solutions could provide a $2bn annual revenue lift in documentary trade financing by 2026 for the global banking industry, on top of $7.7bn in annual revenue without blockchain. This lift in revenue would come from banks financing more documentary trade transactions, attracting new business not currently participating in cross-border trade, and companies shifting select transactions from open account to documentary for greater risk mitigation. [ICC: The importance of fostering incremental innovation (pdf)]
Today’s Quick Links:
Mauritius signs three loan agreements with Saudi Fund for Development
OECD’s West African Papers series: Political settlements with jihadists in Algeria and the Sahel
Strategy for Norway’s efforts in the Sahel region, 2018-2020 (pdf)
Introducing the online guide to the World Development Indicators: a new way to discover data on development
OECD’s Freedom of Investment Roundtable 28: summary of discussion (pdf)