tralac’s Daily News Selection
The new head of Afreximbank’s Southern Africa Regional Office: Humphrey Nwugo
The AfDB has posted an EOI for a trade and regional integration expert to work on, inter alia, the Visa Openness Index 2019 and other flagship publications
AUDA-NEPAD High Speed Rail Detailed Scoping Study: update from CPCS Consultants
Hugh Lamarque: Night drivers of the Northern Corridor (ABORNE)
I heard someone say there are three qualities to a good transporter: experience, liquidity, and what they called hustle – keeping things moving against the odds. Kamau has all of them, and a reputation for rapid deliveries that justifies his steep price tag. Even so, uncertainty hangs over every shipment. Will the roads be empty and the printers work? Or will the container flag up red with a revenue authority and need verification? Nothing is guaranteed and almost everything costs time.
eSwatini joins competition to host AfCFTA HQ (APA News)
In a bid to host the AfCFTA Secretariat head office, eSwatini hastily ratified the 56-year-old Vienna Convention on Consular Relations on Friday. Other countries vying for this opportunity are Egypt and Ghana. eSwatini was the only SADC member that had not signed and ratified the convention, which was eventually debated and acceded to within three hours by members of both houses of Parliament who had held a joint sitting on Friday afternoon. Motivating the motion that was moved by Thuli Dlamini, the Minister of Foreign Affairs and International Cooperation, Prime Minister Ambrose Dlamini said he would back the accession of the policy because of the benefits that come with hosting the AfCFTA Secretariat. “When we applied to host the offices we ticked all the boxes except for the convention, so it is crucial that we consider that,” he said a few minutes before the house acceded. The premier said having the AfCFTA Secretariat offices built in the country would render eSwatini the trade capital of Africa.
Namibia-Ghana Joint Permanent Commission of Cooperation: Namibia encouraged to ratify AfCFTA (New Era)
The business environment is improving yet competitiveness is stagnating. The 2018 World Bank Doing Business report ranked Malawi 110 out of 190 countries, a big improvement from 157 in 2013. Good progress was made in the past two years with the introduction of one-stop service centres, collateral registry and simplification of business registration processes. However, improvement in the ease of doing business is yet to be translated into a competitive business environment. The 2018 Global Competitiveness Index ranked Malawi 132 out of 137 countries with a score of 3.1 out of 7, a decline from the 2014 when the country was ranked 136 out of 148 countries and scored 3.3.
Malawi has a large micro, small and medium enterprises sector, with 987,000 enterprises providing employment to 1.1 million people. However, the country has a very low rate of formal job creation with only 11% of the employed in formal jobs. The main reason is the low rate of private investment, estimated at 6.7% of GDP in 2017, which is well below the 20-25% of GDP needed for sustained, rapid growth.
Because Malawi relies on its neighbouring coastal countries to access global markets for both imports and exports; greater infrastructural connectivity is paramount. According to the 2018 World Bank Doing Business Index, trading across borders has improved by 2.0 percentage points, however still low compared to global rankings with 117 out of 190 countries. In order for Malawi to be able to leverage its membership to the various regional bodies, more attention should be paid to supporting trade facilitation especially in line with infrastructure development along major transport corridors. Malawi stands to benefit greatly from participation in regional value chains on agro-processing in both COMESA and SADC.
Greater commodity and market diversifications are required. In 2017, the country’s main exports were tobacco (59.8%), tea (8.5%), food residues (7.2%), oil seeds (4.7%) and sugar (3.9%), while its main imports were fuel (9.8%), machinery (9.6%), electrical equipment (9.1%), books (8.0%), and pharmaceuticals (6.8%). Its main export trading partners were Belgium 22%, South Africa 8%, Tanzania 8%, Germany 6% and Egypt 6%, while import trading partners were South Africa 18%, China 15%, India 11%, Zambia 7% and UK 5%.
Malawi, Egypt to establish Investment and Trade Council (Malawi News Agency)
New Egyptian Ambassador to Malawi, Hassam Shawky, says Malawi and Egypt are working towards establishing an investment council to promote, among others, trade, investment and agriculture between the two countries. He made the remarks during a press briefing after presenting his letters of credence to President Prof. Peter Mutharika on Thursday. “We are devising a new development programme which includes courses and Egyptian experts coming to Malawi which is completely tailored for the developmental needs of the country. We are interested in the agriculture sector. We are looking at establishing an Egyptian model farm in Malawi.” [Commercial Indian hemp investors dump Malawi]
Malawi Country Environmental Analysis (World Bank)
The Malawi Country Environmental Analysis compiles and reviews existing analyses on Malawi’s environment and natural resources and explores what this evidence means for poverty and economic development. The CEA also identifies 10 strategic recommendations to address the degradation of natural resources and the environment and to promote improved environmental management, investment, and expenditure practices.
The first regional meeting on “Transboundary Cooperation for effective management of World Heritage Sites in Africa” was held 11-15 February, in the city of Man (Côte d’Ivoire), located at 100 km from the Mount Nimba Strict Nature Reserve, the first African transboundary property inscribed on the World Heritage List. Funded by the Netherlands Funds-in-Trust, the main objective of this activity was to exchange knowledge and share experience on the management of various transboundary and transnational World Heritage sites in Africa, including the use of traditional knowledge. During this workshop, 29 working papers were presented in the presence of about 60 experts, site managers, technical and financial partners, academics, and representatives of the private sector from 20 African countries. 40 institutions involved in African heritage management were represented.
The delivery of gigawatts-worth of solar generation across West Africa lies one step closer to reality after calls were put forward for experts to lay the foundations of a major project that was first envisaged in 2016. Nigeria, Mali, Ghana and the remaining members of ECOWAS are looking to hire two consultants – a renewable specialist and a power system planning expert – to help steer the set-up of a solar corridor in the region. Between April and June this year, the experts will produce a strategic plan on how to deliver the scheme, which aims to push solar capacity up to 2GW (2020) and 10GW (2030) across a vast swath of West Africa from Senegal to Nigeria. The call for consultants comes just a few weeks after ECOWAS states put forward a new, unified energy policy framework.
Indian Ocean Commission: Extraordinary Council Meeting convened in Seychelles (GoM)
The hosting of the second edition of the Ministerial Conference on Maritime Security and the 22nd session of the Contact Group on Piracy off the Coast of Somalia in collaboration with the Indian Ocean Commission’s General Secretariat and the EU, were the main issues discussed during the Extraordinary Council Meeting of the IOC on Saturday 23 February 2019, in Seychelles. The Ministerial Conference was convened to define a regional maritime security and safety policy in the South West Indian Ocean region.
We are exporting cement to many of our neighbouring countries and we see that part of the challenge is that infrastructure for trade is still also very weak. If you are taking cement from Lagos to Ghana, you will be amazed at the hurdles that you have to go through even though we have the West African Economic Community Agreement, which allows these goods to move freely. We argue with various agencies, both domestically and at the ECOWAS region that there is need to make this agreement actually work, particularly now that we are going into a wider agreement at the continental level. I’m sure you are aware of that there are efforts to expand intra-African trade through the execution of the AfCFTA and when this comes through, it means that we’ll now have the entire African market open to every manufacturer and every producer in the country and in any other country in Africa. It means that this is an opportunity and also a challenge. We also have to meet the requirements of our export market or even our neighbouring countries’ in order to compete with those coming from other regions. This is why we intensify efforts to strengthen the value chain in our market to strengthen the manufacturing sector and increase its contribution to the economy, GDP in particular. This is a continuing effort.
Ghana’s currency slumped to a record against the dollar after a dovish tilt by the nation’s central bank reduced the appeal of fixed-income assets, sapping foreign-investor demand for the country’s bonds. The cedi has weakened 11% this year, the most among more than 140 currencies tracked by Bloomberg after the central bank unexpectedly cut its benchmark rate in January and signalled more easing may be in store. Out of the GHc2.1 billion ($393m) of two-year and longer-dated maturities sold by the government through 31 January this year, foreign investors bought just 6.3%, according to data from the Central Securities Depository Ghana Ltd. That compares with more than 30% in 2018.
The country’s two seaports handled combined cargo traffic of over 23million metric tonnes last year, representing an 8% increase over the 21 million metric tonnes recorded in 2017, the Ghana Shippers’ Authority has said. The Port of Tema handled 15.50 million metric tonnes of the total traffic, representing 67% of the total seaborne trade, while the Port of Takoradi recorded 7.62 million metric tonnes, representing 33% of the total seaborne trade. Transit volume from the three landlocked countries of Burkina Faso, Mali and Niger however saw a 3.2% decline, with a total of 996,969 metric tonnes in the year under review. This comprised imports of 879,935 metric tonnes and exports of 87,034 metric tonnes for 2018.
Shoprite Holdings, Africa’s largest supermarket group, reported its first half-year earnings decline (pdf) in more than 10 years, due to currency devaluation in Angola and supply constraints in its home market South Africa. Shoprite, which owns more than 2,800 outlets across Africa, said diluted headline earnings per share for the 26-weeks to 30 December fell to 398.5 cents from 525.6 cents in the comparable period. In the group’s Rest of Africa business, profitability suffered mainly as a result of the Angolan operation, where an 85.1% currency devaluation against the dollar since the beginning of 2018 caused affordability challenges. Rest of Africa reported a trading loss of R61.8m versus a trading profit of R552.7m.