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tralac’s Daily News Selection

tralac’s Daily News Selection
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08 Apr 2019

The World Bank-IMF 2019 Spring Meetings open today in Washington

UNCTAD’s Ad Hoc Expert Group Meeting on Competition Law and Policy takes place today in Geneva

UNCTAD’s eCommerce Week: WTO negotiations on ecommerce

UNCTAD stands ready to work with developing countries to enhance their preparedness to seize the opportunities of e-commerce should they choose to join proposed talks among WTO members, the organization’s Secretary-General Mukhisa Kituyi said. “It is a fact that 76 WTO members have launched plurilateral negotiations on trade-related aspects of e-commerce. However, we must ensure that there is a balanced approach that adequately takes into account the needs and considerations of developing countries,” Dr Kituyi told delegates at the fifth edition of UNCTAD eCommerce Week. Speaking at a session on the expectations for the proposed WTO negotiations – which have sparked diverging views among countries – the UNCTAD chief observed that although 88 WTO members are reluctant to join the process, it’s too late in the day for them to be stuck on whether or not there will be e-commerce talks at the global trade body at all

Participants at the session heard various national perspectives on the proposed plurilateral negotiations under the WTO. “We know that the digital economy is growing about 32% faster than the wider economy and creating jobs three times more quickly. E-commerce has been a longstanding element of the WTO’s work,” said Frances Lisson, the ambassador of Australia to the WTO. India’s ambassador to the WTO, J. S. Deepak, argued that proposed negotiations on e-commerce under the WTO were premature. The ambassador of Benin to the WTO, Eloi Laourou, said joining the discussion on the proposed negotiations now would allow the concerns of least developed countries such as his to be considered from the get-go. [UNCTAD’s 2018 Annual Report 2018 has been launched]

AfCFTA: What is in it for Ethiopia? (The Reporter)

Mamo Esmelealem Mihretu, Ethiopia’s Chief Trade Negotiator, says such initiatives bring about the potential to attract better investment to the country and the country will get more export revenue because of the access it has to a wider market. Being a pioneer in the establishment of the AU, Ethiopia is also playing a leadership and a pioneering role in the process of forming this continental free trade area, which Mamo says is expected and important: “The role Ethiopia is playing is expected and benefitting both in terms of political and diplomatic realms in addition to the immense economical significance it carries with it. The CFTA gained credibility for Ethiopia supported it and played a front runner role.”

In addition to these, Mamo observes that the CFTA is a learning environment for Ethiopia which is in the process of acceding to the WTO. “As the subjects of negotiation both for the CFTA and the WTO are the same, the experience from this will help us in our negotiations for WTO accession,” Mamo said indicating that trade in goods, services as well as trade related to infrastructure are all negotiation subjects which are relevant in the WTO accession process. Mamo is of the view that the negotiation for the AfCFTA was hastened because of the lesser impact the agreement would have on the country, while the perceived benefits are far higher; perhaps much higher than the feared threats.

EAC Kigali retreat: Monetary Union and federation will hasten EAC integration (The East African)

Mr Mohamed said the EAC’s problems are not structural in nature and can be resolved with strong political will. “Why are we not obeying the Common External Tariffs? If they are not working we should look at refining them rather than going back on them to appease business lobbies,” Mr Mohamed said. The meeting particularly discussed the persistent non-tariff barrier challenges between Kenya and Tanzania even as it avoided the ongoing diplomatic tiff between Uganda and Rwanda. Multiple sources at the meeting said the Uganda-Rwanda stand-off alongside Burundi’s closure of its border with Rwanda were listed among issues in need of political will. “We are facing issues of implementation, especially with regard to non-tariff barriers between Kenya and Tanzania. There are political issues that need political will,” Rwanda’s State Minister for East African Community Affairs Olivier Nduhungirehe said.

IGAD task force to co-ordinate regional interventions (The East African)

Countries in the Horn of Africa have formed a task force to co-ordinate regional interventions in the face of threats to marine resources and security around the Red Sea and the Gulf of Aden. The team was formed on Thursday in Nairobi by the Committee of Ambassadors from IGAD partner states of Kenya, Uganda, Ethiopia, Sudan, Djibouti, Somalia and South Sudan. The decision was prompted by the need for the states to have a common position on the region’s security and economic interests. The areas of concern are maritime security, migration, terrorism, prevention of illegal and unregulated fishing, pollution, piracy and the dumping of toxic waste.

Angola’s preparations for joining the SADC FTA: WCO update

The WCO, with financial support from the Finland Project II for ESA, organized a national workshop on Rules of Origin for Angola Customs. This workshop was conducted in Luanda, 25-29 March, and was attended by more than 40 officials from Angola Customs and several ministries and other agencies. Angola will join the SADC Free Trade Area in June 2019. Within the framework of this agreement, there is a wide range of possibilities for cumulation with other partner countries in order to strengthen regional integration between SADC members. Topics discussed during the workshop included the key concepts for proper origin determination, related operational and procedural issues, the establishment of an efficient organization and provision of effective training and private sector outreach.

Angola: AfDB posts an EOI for a study to facilitate the transition from the informal to the formal economy

The consulting firm will, inter alia, carry out the following activities: (a) assess the current landscape of the informal sector, needs, constraints and opportunities for conversion to the formal economy; (b) assess and present a summary of international best practices and lessons in the area of transitioning informal economic activities to the formal sector and its success factors; (c) review the existing policies, strategies, regulatory framework and initiatives in Angola that promote the transition from the informal to the formal economy; (d) develop a simplified legal framework for the start-up business and taxation incentives for micro and small enterprises, and the informal sector; (e) develop a business model for the “Entrepreneur’s Single Desk”, including its geographical scope and the type of services offered;

West African Customs implement their regional interconnectivity project to manage their transit operation (WCO)

According to the timetable presented at the Abidjan meeting, interconnectivity is to be rolled out by 2020 for the 15 ECOWAS Customs administrations, but it is the aspiration of the Customs administrations of the WCO West and Central Africa region that this solution should be deployed throughout the region, including in Central Africa. The WCO has undertaken to continue providing technical support to this initiative, which it sees as a priority issue for the region in order to contribute towards the mobilization and coordination of the partners and donors who, together, want to provide support for interconnectivity. [Related WCO update: Building a Regional Framework for Customs Integrity in West Africa]

Nigeria Biannual Economic Update (World Bank)

Nigeria’s emergence from recession remains slow: real GDP grew by 1.9% in 2018. While this was above the 0.8% growth of 2017, it was below the population growth rate, government projections and pre-recession levels. The oil and gas sector reverted to contraction from the second quarter of the year and the non-oil economy was thus the main driver of growth in 2018. While agriculture slowed down significantly due to conflict and weather events, whose effects were not counteracted by direct interventions by the Central Bank of Nigeria, non-oil, non-agricultural growth, which remained negative up to the third quarter of 2017 strengthened through 2018 - but remained weak – with services (primarily ICT) resuming as the key driver. As the oil sector is not labor-intensive, and the non-oil economy was still relatively weak, nearly a quarter of the work force was unemployed in 2018; and another 20% under-employed. With 3.9 million net entrants into the labor force (now 90.5 million people) during 2018 (up to September) (4.5% growth), but virtually no growth in the stock of jobs, unemployment rose by 2.7 percentage points since end-2017, and more than doubled compared to the pre-recession levels (9.9% in Q3 of 2015).

Note: Three sets of comparator country groups are used to benchmark Nigeria’s economic outcomes: structural, aspirational and regional peers. Structural peers include countries that resemble Nigeria in the key economic structure and performance indicators: these are lower middle-income countries with nominal lower-middle countries with nominal income per capita of at least 50% that of Nigeria’s, and/or upper-middle income countries with nominal income per capita less than double that of Nigeria’s; with natural resource share in total exports of 20% or more (Algeria, Egypt, India, Indonesia and Iran) and large populations. Aspirational peers are countries that Nigeria can potentially improve to match its economic performance: upper-middle income countries with nominal income per capita at least double that of Nigeria’s; with natural resource share in total exports of 20% or more, and population of over 30 million (Brazil, Colombia, Malaysia, Mexico, Peru, Russian Federation and South Africa). Regional peers are geographically close countries that exhibit similar economic characteristics (Angola, Cameroon, Cote D’Ivoire, Ethiopia, Ghana, Kenya, Senegal, Tanzania and Uganda).

Building New Platforms of Cooperation: President Buhari’s keynote address to the Middle East and North Africa WEF

In the spirit of “Building New Platforms of Cooperation”, we partnered with the Kingdom of Morocco to domesticate fertilizer production in Nigeria and revive over two million tons of abandoned fertilizer blending plant capacity. The outcome is we created tens of thousands of jobs in agriculture, logistics, manufacturing and retail sectors. We are able to achieve moderate growth. But it was inclusive. Nigeria is now at a new dawn and embarking on a new development trajectory. We are determined to industrialise Nigeria leveraging our comparative advantage. We recognize the private sector as the engine of growth and a veritable partner in our economic agenda. The Middle East is a natural partner. Africa and the Middle East must, therefore, focus on policies that will deliver shared economic prosperity for all our citizens. On trade and investments for example, we can do more. Africa represents only five per cent of Jordan’s trade with the world. But we have the resources, the people and the markets to do more.

Izaak Breitenbach: Brazilian dumpers doth protest too much (Daily Maverick)

Ricardo Santin calls SAPA’s challenge of this predatory trade practice “protectionist” and offers up the fact that only about 500,000 tons of chicken consumed in South Africa are imported from countries such as Brazil. Let it be noted that this represents about 24% of the entire market, a bigger volume than the output of even the biggest single South African producer. If you bear in mind that the EU, for instance, keeps imports strictly within 7% of market volumes, it is preposterous that Santin can expect South Africa to simply nod and accept more than three times more while its own industry contracts. But if you consider that Brazil is presently the source of 61% of all those imports, it makes sense why Mr Santin is protesting so much. Who is being protectionist now? What is at issue here is the damage that dumping does. Dumping prevents expansion, inhibits job creation and stops emerging farmers from entering the market and becoming landowners. This is the experience in South Africa, and now also in Namibia, and no amount of posturing about the importance of trade partnerships can change that. [The author is GM of SAPA’s Broiler Organisation]

South Asia Economic Focus, Spring 2019: exports wanted (World Bank)

Using a gravity model, we show that South Asian countries export only a third of their potential. If countries export closer to potential, not only would short-term adjustments be easier, but also the long-term growth potential would be higher. Closing the export gap is an essential step in addressing both short-term and long-term macroeconomic challenges in South Asia. India: GDP is forecast to expand 7.5% in FY2019/20. Credit growth will benefit from relatively more accommodative monetary policy amid benign inflationary conditions. Support from delayed fiscal consolidation will partially offset the effects of political uncertainty on economic activity around elections in May.

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