Building capacity to help Africa trade better

tralac’s Daily News Selection


tralac’s Daily News Selection

tralac’s Daily News Selection
Photo credit: Reuters | Charles Placide Tossou

The 8th Annual Borderless 2019 Conference starts tomorrow in Accra. The theme: Trade facilitation intra-regional in West Africa – new trends

Inclusive trade in Africa: The African Continental Free Trade Area in comparative perspective. Providing the first book-length analysis of the AfCFTA, this volume (edited by David Luke and Jamie Macleod, published by Routledge) asks how can it be ensured that the AfCFTA is effectively implemented to deliver inclusive trade in Africa. The contributors assess what important lessons can be drawn from the experiences of regional integration in and beyond Africa, including from success stories like ASEAN as well as from failures like the Free Trade Agreement of the Americas.

A reminder of tralac’s handy guide to the AfCFTA Agreement, providing an overview of intra-African trade in goods and services, intra-African tariffs, and trade facilitation. It is also desktop, tablet and mobile friendly!

Nigeria: Manufacturers call for public debate on AfCFTA impact report (Investors King)

Manufacturers have said there is a need for all stakeholders to discuss publicly the report of the Presidential Committee for Impact and Readiness Assessment of the African Continental Free Trade Area agreement before it is adopted. The committee is said to have completed its work after the timeframe set for it, but manufacturers want its report in the open for public discussion. The President, Manufacturers Association of Nigeria, Ahmed Mansur, stressed this much in a recent interview with our correspondent. “What we are saying now is that the report of that committee ought to be widely discussed and all stakeholders must be aware of what the costs and benefits are. All stakeholders need to see what the opportunities are and what the government will do to mitigate some of the adjustments.”

Headwinds towards East African regional integration: will this time be different? (Brookings)

From the near pinnacle of a customs union, the old EAC came crashing down in 1977. Why? Political differences between the erstwhile leaders and perceptions around unfair distribution of the benefits and costs of regional integration halted the momentum. Through rebirth and enlargement, though, the new EAC has again risen to great heights as one of the most successful integration schemes on the African continent. Then again, recent headlines like “Uganda, Rwanda feud restricts free movement” and “Uganda and Rwanda trade accusations over border crossing dispute” are stark reminders of some of the difficulties that precipitated the demise of that previous integration experiment. Despite the current headwinds, the prospect for an integrated EAC remains bright. That said, the member states need to pay heed to a key lesson from worldwide integration schemes. That is, that things get tough during the process. If in doubt, just look at the unfolding consequences of Brexit for the European Union. With luck, history won’t repeat itself in East Africa. At least, not at this very moment. [The author: Aloysius Uche Ordu]

Recent African trade analyses posted by CUTS Geneva:

  1. Comprehensive review of the EAC Common External Tariff: what are the salient issues? (pdf). The process to comprehensively review the EAC Common External Tariff (CET) presents an opportunity for the region to strengthen its trade and related policies towards enhancing their competitiveness in global trade, while also being mindful of sustainability aspects such as climate change. This briefing paper highlights the salient issues in this regard.

  2. Reforming the WTO: suggestions for an African Agenda (pdf)

  3. Competition concerns in cross-border e-commerce: implications for developing countries (pdf)

Kenya: New policy will kill jobs, car dealers say (Business Daily)

The government will implement the national automotive policy over our dead bodies, used car dealers have said. Kenya Auto Bazaar (Kaba) in its ‘Wakenya Hatuwezi Hii’ campaign says the proposed policy is a sugarcoated poisonous capsule that could make the country a captive of multinational car manufacturers. Kaba chairman John Kipchumba said if implemented, the policy would deny Kenyans the freedom to have cars of their choice. “Kenyans will take expensive loans to buy vehicles. The policy will destroy competition by creating a protected market for multinationals through local assemblers and new motor vehicle franchise holders,” Mr Kipchumba told the Sunday Nation. The association says implementation of the policy would render mechanics, taxi drivers, matatu operators, car dealers, clearing agents and millions of other Kenyans jobless. It will sacrifice small and medium enterprises on the altar of greed, it added. “There will be a 70% drop in used vehicle imports while prices will double. We have been importing about 85,000 units every year but the figure will reduce to less than 20,000,” Mr Kipchumba said.

Ambassador Kyle McCarter: The United States – a value proposition (CapitalFM)

Our new strategic partnership with Kenya holds the promise of great prosperity for both of our countries and we want our investments - both public and private - to provide the maximum benefits possible. Our governments have built a relationship rooted in common values. The door is open for private sector-led growth to be the engine that will transform Kenya. The US model focuses on sustainable financing, not unmanageable debt. We believe that hiring Kenyans to manage, lead, and do the skilled work represents the best path to long-term profitability and self reliance. A clear example of how governments, workers, managers, and Kenyans all prosper through transparent business with US companies is the Mombasa-Nairobi highway project that the Kenyan government awarded to Bechtel, a world-class US engineering company. Presidents Trump and Kenyatta committed to concluding the terms of the financing agreement in Washington last year, recognizing the benefits of the project. The new Mombasa-Nairobi highway makes good sense for Kenya’s infrastructure, economy, trade, and regional leadership. [Landry Signé: A Trump visit to Africa is important — and carries some urgency]

Zambia-Saudi Arabia Joint Permanent Commission: update (Lusaka Times)

Zambia and Saudi Arabia have agreed to negotiate and sign a Bilateral Trade Agreement to facilitate seamless trade and a Bilateral Investment Treaty to facilitate investment. And Saudi Arabia is considering sending a Technical team to Zambia to assess the epidemic situation and veterinary services as well as get acquainted with procedures followed to control Foot and Mouth Disease thus to consider uplifting the ban of export of livestock to Saudi Arabia. At the 3rd Session of the Zambia-Saudi Arabia Joint Permanent Commission (16-18 April) the two countries also agreed to explore ways and means of procuring more petroleum products for Zambia from that country. Saudi Arabia expressed interest to cooperate with Zambia in the supply of phosphate fertilizer, investment in farm blocks and health sector in Zambia, training of Zambian medical specialists in various medical fields, renewable energy, collaboration between agriculture and veterinary research institutes, as well as opportunities under the Saudi Fund for Development and the Saudi Export Program. [Nigeria-Pakistan Chamber of Commerce underway]

Mauritius: Tourism sector expected to grow by 3.6% to reach 1 450 000 tourists this year (GoM)

The tourism sector for 2019, according to Statistics Mauritius, is expected to grow by 3.6% to reach 1 450 000 tourists, which is well above the growth rate of 3% required to reach two million tourists by 2030. These figures were revealed at the National Assembly by the Minister of Tourism, Mr Anil Kumarsingh Gayan, in reply to the PNQ of the Leader of Opposition. Mauritius’ competitors in the Indian Ocean, the Minister remarked are Seychelles, Maldives and Sri Lanka, and these countries have adopted an open skies policy: “What a liberal aviation policy implies is that airlines have complete flexibility to respond to market demands and opportunities, and passengers benefit from the widest possible travel and flight options at competitive rates.” Tourist arrivals for the last three months are as follows as per Statistics Mauritius: Total tourist arrivals for January 2019 increased by 1.1% in spite of the adverse climatic conditions; Total tourist arrivals for February 2019 were at par with February 2018. This is mainly explained by the decrease in tourist arrivals from China and India due to the reduction in airlift capacity by 6,500 seats resulting in a drop of 5.6%; and Total tourist arrivals in March 2019 dropped by 4.5% mainly because Easter holidays this year are in April. [Mauritius’ financial services sector is reliable and in conformity to international standards, says Minister Sesungkur]

East Africa: Regional tea exports grow by 21% (Daily Monitor)

Tea export volumes from East Africa to the rest of the world recorded a 21% growth, the latest April auction report has shown. Records from the auction (15-16 April, Mombasa), show that the region exported a total of 9.6 million kilogramme bags, up from 7.5 million kilogramme bags shipped around the same time the previous year. At least six Eastern African member states actively participated in the auction out of the nine auction listed countries. The auction report by the East African Tea Export Auctions showed that Kenya exported over 7.2 million kilogrammes bags more than the 5.7 million it exported the same time last year. This indicated a 19.7% increase in exports. Uganda - the region’s second largest exporter - recorded the highest export margin of 43% increase when it sold a total of 1.4 million kilogramme bags up from 816,621 kilogrammes bags exported around the same time last year. [Related: East Africa braces for tough times as food crisis is forecast; Kenya banks on inter-regional trade to meet food deficit; An interview with NEPAD’s Dr Hamady Diop: Africa needs policy reforms]

Supporting Vietnam’s economic success through greener, cheaper, and more efficient trucking (World Bank Blogs)

To address these issues, our team conducted the first-ever comprehensive study of Vietnam’s trucking sector, which drew on a nationwide survey of more than 1,400 truck drivers, interviews with 150 private and public stakeholders, and a detailed review of the key factors influencing logistics costs and emissions. The results of our analysis and associated policy recommendations have been compiled in a new report: Strengthening Vietnam’s Trucking Sector- Towards Lower Logistics Costs and Greenhouse Gas Emissions. The report identified 14 possible policy interventions along four dimensions, summarized below. While our work focuses on Vietnam, the study draws on international examples as well, and could certainly help other countries modernize their trucking industry. [Nigeria needs a logistics revolution to prepare for the free trade agreement]

China’s trade with other Asian countries: a mixed bag (Hindu Business Line)

A closer consideration of specific countries in the region in Figure 4 reveals a mixed picture within this overall pattern of growing trade surpluses of China. Of the seven major Asian economies considered here, China has had persistent deficits only with Malaysia, which has generally exported high technology goods to China. However, such deficits also declined substantially between 2011 and 2015, and increased slightly thereafter but in 2018 still remained well below the level of 2011. With Thailand as well, China’s trade deficits have narrowed over the years, while the earlier deficit with the Philippines has moved to substantial surplus. Indonesia, Bangladesh, Vietnam and India all show trends of increasing surpluses, to varying degrees. [The authors: CP Chandrasekhar, Jayati Ghosh]

Today’s Quick Links:

World Bank Q&A on Rwanda Poverty Statistics

India is not a tariff king, has right to protect specific sectors under WTO: experts

East Asia Forum: Australia’s Huawei ban raises difficult questions for the WTO

US companies could be biggest winners (or losers) in China deal

Learning from IDA experience: lessons from IEG evaluations, with a focus on IDA special themes and development effectiveness

Dubrovnik Guidelines: Cooperation between China and Central and Eastern European countries


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