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tralac’s Daily News Selection

tralac’s Daily News Selection
Photo credit: Arne Hoel | World Bank

30 Jan 2019

Featured commentary, Célestin Monga (Project Syndicate): Reaping the benefits of African economic integration

East Africa’s private sector seeks larger role in resolving EAC challenges (Daily News)

As the East African region braces for the EAC Heads of State Summit this Friday, the region’s private sector has asked for deeper engagement in resolving economic challenges facing the bloc. In a telephone interview with ‘Daily News’ yesterday, East African Business Council executive director, Mr Peter Mathuki observed that issues like the removal of non-tariff barriers, ease of doing business and trade facilitation will only be resolved if the private sector gets fully engaged in matters of integration. “The private sector needs to be fully involved in its entirety in integration issues; we no longer want to be mere observers but actors in this matter.”

An interview with the EABC’s Peter Mathuki: Our new models will help regional businesses grow their networks (The East African)

The EABC will also take a lead role in the African Continental Free Trade Area with an eye to opening up new markets for businesses. The council will mobilise the private sector to support partner states in endorsing the agreement. The EABC hopes to expand its membership base: currently, we have around 150 members. We are looking to raise that number to 500. We will divide the EABC into five departments in order to strengthen it: The service department, which will tackle tourism, airspace and telecommunication; manufacturing; agriculture; energy and infrastructure department to support growth and trade facilitation; and the SMEs department, to attract small and medium players to join the Council. [Rwanda, Burundi frosty ties to feature in summit]

Zimbabwe’s trade deficit hits $2,4bn (The Herald)

Zimbabwe’s trade deficit for the 11 months to December 2018 stood at $2,4bn, as the value of imports continued to outstrip value of exports, mostly unprocessed raw materials. Figures from the Zimbabwe national Statistics Agency, show that Zimbabwe imported goods worth $6,3bn between February and December 2018, from $4,9bn recorded during the same period the prior year. This was against exports that came in at $3,9bn, representing an increase of 14% from the $3,4bn worth of exports recorded in 2017. However, the growth was not enough to offset the ballooning import bill. According to Zimstats, South Africa remained Zimbabwe’s top trading partner accounting for the biggest chunk of both imports and exports while Mozambique, China, United Arab Emirates and Zambia have also remained Zimbabwe’s top trade partners.

Zambia: Modernising licensing for customs clearing agents (Global Alliance for Trade Facilitation)

Customs clearing agents in Zambia are to be offered accredited training as part of a new trade facilitation project being launched today by the Zambia Revenue Authority and the Global Alliance for Trade Facilitation. Over the next two years the project will see the ZRA, customs clearing agents associations, training institutions and local and international businesses that trade in Zambia work together to design and introduce a new framework for licensing customs clearing agents. Customs clearing agents will be able to access a professional course delivered by qualified trainers, combining practical, hands-on training with e-learning. They will then sit an exam, allowing them to demonstrate their competence in applying ZRA regulations and the Harmonized Tariff Schedule. The project is the result of several months of collaboration between the ZRA and the private sector to identify the challenges faced by traders moving goods across Zambia’s borders. It will support Zambia’s plans to implement the World Trade Organization’s Trade Facilitation Agreement and increase the competitiveness of Zambian industry. The project in Zambia becomes the ninth in the Alliance’s portfolio of work to support developing and least developed countries implement the TFA through the public and private sectors working together.

The State of Small Business in South Africa (TIPS)

How many small business are there? As Graph 1 shows, the number of formal small business reported in the labour market surveys climbed from around 600 000 in 2010 to 2012 to 640 000 in 2017. The number of informal business grew from 1,3 million to 1,5 million in the same period. Small business by sector. According to the Labour Force Survey, the distribution of small business between industries was stable over the past decade. In 2017, a quarter of formal small businesses were in business services, with almost as many in trade. A seventh each was in construction and personal services. In the services sectors, around a quarter of small formal businesses were in cleaning and security, with professional services such as law firms and healthcare accounting for most of the rest. Just under a tenth of formal small enterprises were in manufacturing, with over a quarter in metals and machinery, followed at a distance by food processing, wood and printing. Half of all informal businesses were in trade, a seventh in construction and another seventh in personal services. The main services for informal enterprises were cleaning and security. Just under a tenth of informal businesses were in manufacturing, largely clothing followed by metals. [Related: World Bank on its growth forecasts for South Africa: Better to err on the side of caution; Public-Private Growth Initiative believes high-growth South Africa is within reach]

Global seed firms reach only 10% of world’s small farmers (EABW)

Global seed companies are adapting their products to combat the impact of climate change and address nutrition needs. But limited access to quality seed in many emerging economies persists, with the global seed industry reaching just 10% of the world’s smallholder farmers, according to a new study. The Access to Seeds Index 2019 – Global Seed Companies, published by the Amsterdam-based Access to Seeds Foundation, evaluates the activities of the 13 leading global seed companies to shine a light on where the industry can do more to raise smallholder farmer productivity, improve nutrition and mitigate the effects of climate change through the development and dissemination of quality seed. The research shows that sales by the 13 global seed companies only reached around 47 million of the world’s 500 million smallholder farmers in 2017, and most investment went to a small number of countries, mostly in South and Southeast Asia. In these regions, global companies invest heavily in local seed business activities: 12 of them in breeding and 12 in production. In contrast, such activities are rare in Western and Central Africa, with only two companies investing in local breeding and one in production.

Trade misinvoicing undermines the impact of international trade in developing nations (GFI)

A new analysis of illicit financial flows due to trade misinvoicing in 148 developing countries demonstrates that trade-related IFFs appear to be both significant and persistent features of developing country trade with advanced economies. As such, trade misinvoicing remains an obstacle to achieving sustainable and equitable growth in the developing world. This update, pdf Illicit Financial Flows to and from 148 Developing Countries: 2006-2015 (1.15 MB) , is the latest in a series of Global Financial Integrity reports which provide country-level estimates of the illicit flows of money into and out of 148 developing and emerging market nations as a result of their trade in goods with advanced economies. Increasing trade among developing and emerging market countries is seen by many economists as a primary path to greater development. However, high levels of misinvoicing, as a percentage of total trade, indicate that most developing country governments do not benefit from a significant portion of their international trade transactions with advanced economies. Highlights of GFI’s research for 2015 (the most recent year for which there is usable data) show that:

Corruption Perceptions Index: Sub-Saharan Africa (TI)

This year’s Corruption Perceptions Index (CPI) presents a largely gloomy picture for Africa – only eight of 49 countries score more than 43 out of 100 on the index. Despite commitments from African leaders in declaring 2018 as the African Year of Anti-Corruption, this has yet to translate into concrete progress. Seychelles scores 66 out of 100, to put it at the top of the region. Seychelles is followed by Botswana and Cabo Verde, with scores of 61 and 57 respectively. At the very bottom of the index for the seventh year in a row, Somalia scores 10 points, followed by South Sudan (13) to round out the lowest scores in the region. Notwithstanding Sub-Saharan Africa’s overall poor performance, there are a few countries that push back against corruption, and with notable progress.

Two countries – Côte d’Ivoire and Senegal – are, for the second year in a row, among the significant improvers on the CPI. In the last six years, Côte d’Ivoire moved from 27 points in 2013 to 35 points in 2018, while Senegal moved from 36 points in 2012 to 45 points in 2018. These gains may be attributed to the positive consequences of legal, policy and institutional reforms undertaken in both countries as well as political will in the fight against corruption demonstrated by their respective leaders. With a score of 37, Gambia improved seven points since last year, while Seychelles improved six points, with a score of 66. Eritrea also gained four points, scoring 24 in 2018. In Gambia and Eritrea, political commitment combined with laws, institutions and implementation help with controlling corruption. In the last few years, several countries experienced sharp declines in their CPI scores, including Burundi, Congo, Mozambique, Liberia and Ghana. [A DW interview with Samuel Kaninda: Transparency International’s coordinator for West Africa]

Today’s Quick Links:

EU market opens up for Kenyan sweet potato farmers

Ethiopia-Djibouti Transport Corridor Project Phase I: Environmental and social impact assessment summary, Resettlement Action Plan summary

Tanzania: TANESCO at centre of efforts to spread power supply across Africa

Uganda, Tanzania edge closer to constructing oil pipeline

AU-ILO-IOM-ECA hold steering committee meeting on labour migration

SAIIA G20 Africa Conference: Navigating African Priorities for the G20

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