tralac’s Daily News Selection
The High-Level Policy Dialogue, Harnessing the benefits of the AfCFTA for a Ghana Beyond Aid, opened today in Accra:
“Execute your watchdog role effectively”: Akufo-Addo tells regulatory agencies. Addressing the opening ceremony of the National Conference on the implementation of the AfCFTA Agreement, President Akufo-Addo said: “It is essential that the regulatory bodies rise to the occasion and be up and doing in the discharge of their duties in order to promote discipline in the activities of the private sector. Institutions such as the Bank of Ghana, the Registrar of Companies, the Securities and Exchange Commission, the National Insurance Commission, and the National Pension Regulatory Authority must see to the effective regulation and supervision of the entities within their remit. We have seen what the previous failure of regulation led to in the banking sector.”
The conference will have eight different sessions that will, amongst others, focus on putting the AfCFTA in context, the economic benefits to be derived for Ghana from the implementation of AfCFTA, analyze how the AfCFTA will contribute in practical terms to realizing the objectives of the AU’s Agenda 2063, the SDGs and a Ghana Beyond Aid. Other sessions will look at the operationalizing the AfCFTA in Ghana, discuss what actions are needed to develop and implement Ghana’s National Programme of Action for Boosting Intra-African Trade, and explore ways of boosting employment opportunities for the youth as well as enhancing the empowerment of women.
The AfCFTA and the Nigerian private sector: report of the NACCIMA-Deloitte AfCFTA Dialogue (30 July, Lagos)
Participants observed that the delay by Nigeria in acceding to the Agreement may have resulted in Nigeria losing some advantages, such as the possibility of being the host of the AfCFTA headquarters. However, Nigeria’s eventual accession was consistent with its role as the leading economy in Africa. Participants also agreed that signing the Agreement after the nation-wide consultations to pave the way for the signing was the right step and emphasized that the delay in the signing of the AfCFTA was good for the country and the continent, in as much as it helped to focus the minds of decision-makers on several shortcomings of the Agreement, as originally drafted, and that the consultative process helped to legitimize the AfCFTA in Nigeria.
Participants identified “implementation” as the real challenge in ensuring that this continent-wide trade agreement truly served as a framework to boost intra-African trade. Accordingly, they called on the National Action Committee (NAC) to take cognisance of that fact and urged NAC to support and encourage the efforts of the private sector’s deep engagement and buy-in into all areas of the Agreement, especially in the areas of free movement of persons, industrialization, value chain development, gender equality, strengthening of Regional Economic Communities, and promoting cross border trade.
On opportunities for Nigerian banks, creativity and entertainment sector, the private airlines: Participants recognized that Nigerian banks currently dominate the banking and financial sectors in West and East Africa and this was an indication of the capacity of the banks and the financial sector to compete effectively under the AFCFTA. Attention was also drawn to the entertainment and creativity sectors which is largely dominated by Nigeria as well as airline operators - which despite the tough times facing the domestic aviation sector - are now providing services across the west and other parts of Africa. This is an indication that the Nigerian private sector is well prepared can effectively play on the terrain of a vast continental market of over 2.1 billion people.
South Africa and the AfCFTA: Patel establishes national committee on new African trade agreement (Engineering News)
Trade and Industry Minister Ebrahim Patel has set up a national committee, comprising representatives from business, labour and government, to develop action plans around the new AfCFTA. The committee was set up at a strategic session between the Ministry and social partners at the National Economic, Development and Labour Council (Nedlac), and was the first session held with the new Ministry following the combination of the departments of Trade and Industry and Economic Development. The day-long session gave rise to a number of tripartite working groups to speed up actions to grow the number of jobs in the South African economy. Working groups are expected to meet during August and September.
Tripartite Free Trade Area integration agenda: Capacity building strategy developed
39th SADC Summit of Heads of State and Government: selected updates
Extracts from the communiqué: Summit noted the overall decline in food production in the Region, for the 2018/19 crop season, and urged Member States to implement comprehensive multi-year response plans to tackle the recurrent droughts and food insecurity to boost agricultural production; Summit noted progress made on the implementation of the SADC Industrialization Strategy and approved the Protocol on Industry, which aims to promote the development of a diversified, innovative and globally competitive industrial base; Summit noted with great concern the slow growth in the intra-SADC trade levels, and that the region continues to export unprocessed raw material to the rest of the world, thereby forfeiting the potential benefits of the resource endowments. To this effect, Summit agreed to accelerate the implementation of the industrialization strategy; Summit directed the SADC Secretariat to expedite the operationalization of the SADC Disaster Preparedness and Response Mechanism as part of the regional measures to respond to effects of climate change; Summit noted that Burundi met some of the eligibility criteria for admission of new members into SADC, and that she will submit a progress report, based on which a verification Mission will be undertaken.
Poor information sharing crippling intra-trade performance in SADC. The new Chairperson of SADC, Tanzania’s John Pombe Magufuli, has singled out poor information sharing among member states as a factor crippling intra-trade and economic performance in the region: “There are many reasons why our economies are not performing as expected, one of them being lack of information on the opportunities available in our respective countries.” He told the SADC summit that in May this year he had visited four SADC countries, three of them were affected by food shortage due to drought and other natural disasters. “It surprised me to hear that those countries were planning to import food from outside Africa while in Tanzania we were struggling to find markets for 2.5 million tonnes of our food surplus. Due to lack of information, our countries are also importing cars, sugar, and fuel very far away from our region while some SADC member states like South Africa, Mauritius and Angola, for instance, are producing the same.”
SADC leaders sign protocol on industry development. To ensure that the Industrialisation Strategy and Road Map 2015/2063 is implemented, Dr Magufuli said they have directed the SADC Secretariat to fast-track the removal of the non-tariff barriers that impede businesses among member states. He said the secretariat was directed to speed up the removal of NTBs at borders, red tape in decision making and corruption, among others. “We have directed the secretariat to present a report during the next summit,” said Dr Magufuli. To address the challenge of funding for development projects, the summit endorsed the Regional Resource Mobilisation Framework.
Akinwumi Adesina: “AfDB’s $13bn investment in Southern Africa is delivering strong results: Africa must not be under-ambitious!” The AfDB has invested heavily in the region with key projects including a $5bn investment in ESKOM, critical for power supply for South Africa and the SADC region. The Bank has also supported Mauritius with $114m for its St. Louis Power Plant that now provides 36% of the population with electricity. “For every dollar of paid-in capital by the region, it received about $ 19 in investments, an impressive 19:1 leverage ratio,” Adesina said in his address. “Unlocking the potential of the Inga hydropower project in the Democratic Republic of Congo must be a top priority,” Adesina urged. The Bank is supporting the establishment of a $1.2bn SADC Regional Development Fund to help mobilize domestic resources for regional infrastructure and industrialization. In May this year, the Bank approved $2m for the operationalization of this Fund, including for project preparation for agriculture, pharmaceuticals, and mining.
SADC summit closes with 100bn/- European deal. The SADC Secretariat and the EU yesterday signed three development cooperation programmes worth over 100bn/- (euros 47 million) for a period of five years under the 11th European Development Fund. The three programmes, which will be implemented by the SADC secretariat, were listed as Support to Improving the Investment and Business Environment; Trade Facilitation Programme; and Support to Industrialisation and Productive Sectors. The SIBE Programme aims at achieving sustainable, inclusive growth and support job creation through transforming the region into a SADC investment zone, promoting intra-region investment and FDI, with a focus on SMEs. The Trade Facilitation Programme will contribute to enhancing inclusive economic development in the SADC region through deepening regional economic integration. Finally, the SIPS programme is geared to contribute to the SADC industrialisation agenda, improving the performance and growth of selected regional value chains and related services in the agro-processing and pharmaceutical sectors. [Related: SADC convenes inaugural EDF meeting on peace and security]
- Related: South Africa and Tanzania commit to greater economic cooperation. The Heads of State agreed that the second session of the South Africa-Tanzania Binational Commission would be hosted in South Africa in 2019 on a date to be agreed. The leaders also noted with satisfaction the coming into effect of the AfCFTA – an ambitious initiative to accelerate intra-continental trade and advance economic integration. Addressing the South Africa-Tanzania Business Forum, the two leaders called on their respective business communities to work together to achieve inclusive growth and development. To promote rapid industrialisation and development, they agreed on the need to enhance the ease of doing business in the two countries. President Ramaphosa said: “South Africa is ready and prepared to craft a new partnership model with Tanzania, where government and business work together to clear the way for more investment to flow between our two countries”.
Tanzania: Exports of goods, services fall in June (pdf, BoT)
In the year ending June 2019, the value of exports of goods and services declined slightly to $8,561.6m compared with $8,588.5m in the year to June 2018, driven by goods exports, particularly traditional goods exports. Value of traditional good exports declined to $515.4m from $1,125.3m in the corresponding period in 2018. The decline was observed in all traditional crops, except coffee and cotton. Meanwhile, value of non-traditional goods exports, which accounts for 80% of goods exports, increased to $3,569.7m from $3,140.1m, largely driven by gold exports (see Chart 5.1). The value of gold — that accounted for more than 40$ of non-traditional exports —grew by 18.7% to $1,743.4m on account of an increase in volume. Foreign exchange receipts from services, which accounted for about 40% of total exports, increased to $4,068m in the year to June 2019 from $3,896.6m in the corresponding period in 2018. The increase was driven by travel receipts—mainly from tourism— which grew by 7.4% to $2,488.1m owing to increase in the number of tourist arrivals (see Chart 5.2).
On imports: In the year ending June 2019, the value of goods and services imports increased by 5.5% from the levels registered in the year ending June 2018 to $10,257.6m on account of goods imports. Goods import bill increased to $8,347.0m, from $7,666.1m in the year ending June 2018, driven by import of capital goods for the ongoing infrastructure projects in the country (see Table 5.2). Meanwhile, the value of consumer goods imports declined owing to decrease in food and food stuffs import bill following good harvests during 2017/18 crop season.