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tralac’s Daily News Selection

tralac’s Daily News Selection
Photo credit: Simon Dawson | Bloomberg

23 Aug 2019

A tralac Guide to this weekend’s G7 Summit, next week’s TICAD7

The G7 starts tomorrow, concluding on Sunday: selected previews

  1. A Japan Times preview: Leaders from the Group of Seven democracies will gather in the seaside resort town of Biarritz beginning Saturday for what is expected to be a fractured, contentious summit due to fundamental disagreements between the US and other members over trade and climate change. Citing unnamed government sources, Japanese media outlets had reported that this year’s G7 was unlikely to issue a joint statement for the first time in its history. Another senior Japanese diplomat has said Paris, the chair of this year’s summit, appears to be trying to focus on less controversial issues this year to avoid critical confrontations among members, such as wealth inequality and issues related to Africa.

  2. A renewed format for the G7: The French G7 Presidency is therefore the opportunity, in 2019, to change the group format. Throughout the year, several French ministers have therefore organized working meetings with their G7 counterparts, and invited partner countries including Egypt, Mali and Mexico to take part. The President invited the following to the Biarritz G7 Summit: four partner countries, involved in protecting and promoting democratic freedoms and with a major regional influence Australia, Chile, India, South Africa), and five African partners (Burkina Faso, Senegal, Rwanda, South Africa, and the Chairperson of the AUC, Moussa Faki) to create a partnership on an equal footing with this continent of the future.

  3. A perspective from Kigali. Olivier Nduhungirehe, Rwanda’s State Minister in charge of the EAC at the Ministry of Foreign Affairs and International Cooperation: “He (the President) will address the topics proposed: women entrepreneurship, digital transformation and transparency in public procurement and common fight against corruption.”

  4. EU to pledge Africa micro-finance, security funds at G7 summit. The EU will also back an initiative by the African Development Bank to ease loans through African banks and micro-finance institutions for over 100,000 women-led businesses in Africa. It is not immediately clear how much money will go to these funds. Tusk is set to disclose figures at the summit. Aside from the money, the EU will also seek to provide further support to African states hosting some 5,000 EU co-financed troops in an area known as the Sahel.

  5. G7 performance on Africa: Global Governance Project analysis

The Seventh Tokyo International Conference on African Development (TICAD7) takes place next week in Yokohama (28-30 August). A guide to the programme, early previews, country updates:

  1. Japan-Africa Business Forum: 20 pre-eminent business leaders will share their experience of doing business in Africa. Speakers include Mr Tony Elumelu, one of Africa’s foremost investors and philanthropists; Mr Jacko Maree, of South Africa’s Standard Bank Group; and Mr Tewolde Gebremariam, Group CEO of Ethiopian Airlines, which has an extensive network spanning over 100 cities (including 60 African cities). The forum will focus on “African Innovation & Start-ups” and “Multilateral Business Partnership.” [Download the programme here (pdf)]

  2. Japan-Africa Business Expo: The Business Expo, the largest official side event, includes a “Japan Fair” to promote the attractiveness and potential of Japanese industry through the display of products, technologies and services by Japanese companies to heads of state, ranking officials and business leaders from African countries who are scheduled to visit Japan for TICAD7.

  3. Africa Startups Pitch: Mobile apps are now a new social infrastructure in Africa, as seen for example with the rapid spread of mobile payment such as M-Pesa. As a result, there is an increasing number of startups developing products and services targeting the previously difficult to access lower income sector of the market. JETRO is collaborating with Co-Creation Hub (CcHUB), the largest accelerator in Nigeria, for the first time to organize a pitch event featuring 10 deep-tech startups selected from over 200 applications. It will take place on 30 August.

  4. “Innovation” will be a major theme at TICAD7. Nigeria, with the largest population on the African continent, is looking at the potential of “Science, Technology and Innovation” development cooperation. The Nigerian government and private sector conduct “Ideathon” sessions on STI, where excellent ideas are refined into peak condition through repeated exposure in the same way as a marathon. JICA is supporting this initiative for the improvement of public services. Hideki Watanabe, a member of JICA’s STI team, comment on the potential of Nigerian start-ups’ participation in the Ideathon, and the support STI can provide going forward.

  5. Japan will host the launch meeting for Gavi’s third replenishment (30 August). Gavi will unveil its Investment Opportunity for the 2021-2025 period highlighting the Alliance’s ambition to build on its success by providing the most comprehensive package of protection yet.

  6. Japan extends loans and scholarships in tug of war over Africa. Japan will pledge over 300 billion yen ($2.84bn) in assistance to Africa at a development conference later this month, seeking to encourage transparent infrastructure development on the continent as China moves in. With Beijing extending its clout on the continent through its Belt and Road infrastructure-building initiative, Japan is eager to bolster its own role in the region through yen loans and a state-sponsored scholarship that will bring African students to Japan. Japan and the African Development Bank have been helping with the development of infrastructure and private-sector companies through their Enhanced Private Sector Assistance Initiative. The next and fourth round will involve mainly yen-denominated loans. The money will be disbursed over roughly three years as target countries tackle reforms. Japan will encourage recipients to open up to foreign investment and create legal frameworks that protect investors.

  7. Japan to voice concern over African nations’ debt issues at TICAD meet. Japan plans to include “concern” over excessive debt in the declaration for the Tokyo International Conference on African Development later this month, government sources said Sunday, a move aimed at calling out China’s lending practices in the region. Japan wants the post-conference declaration to include references to some African countries being saddled with debt, and touch on the importance of “high quality” infrastructure, a phrase Japan often uses to differentiate its projects from Chinese ones. Prime Minister Shinzo Abe, who will co-chair the conference, plans to announce steps to support Japanese firms that want to do business in the region, as well as measures to help African countries with fiscal consolidation, the sources said. One such measure would be to send financial experts to debt-ridden countries on multiyear missions to help improve their finances, they said. Japan, whose working-age population is rapidly shrinking, also hopes to make it easier for African students to find work in the country after graduating.

  8. J. Berkshire Miller: Japan is taking on China in Africa. Traditionally, Tokyo focused its efforts in Africa on soft-power diplomacy, mainly through the provision of development aid. That is changing, though, for a number of reasons. First, given its size and its domestic economic woes, Japan is finding it harder and harder to compete in terms of quantity of funding with other players on the continent, especially China. First, given its size and its domestic economic woes, Japan is finding it harder and harder to compete in terms of quantity of funding with other players on the continent, especially China. Second, Tokyo is realizing that its assistance should be more directly linked to its core foreign-policy interests, including promoting its Free and Open Indo-Pacific (FOIP) vision, in which Africa plays an important role. Despite Japan’s strong relationships in Africa, especially with Algeria, Nigeria, and South Africa, among others, it is struggling to catch up with China’s recent spending spree. Although Japan’s foreign direct investment in Africa remains substantial - as of 2017, it had a stock of $9bn in investments there - it is a fraction of that provided by China. The story is even worse when it comes to trade. Japanese exports to Africa dropped by almost half over the last decade and now sit at approximately $7bn. Meanwhile, Chinese trade has accelerated at breakneck speed, with exports surpassing $100n in 2018. It also imports nearly $100bn worth of goods from Africa.

  9. Japan to lend expertise to help African nations improve waste management. A nation with a high level of garbage disposal expertise, Japan is expected to declare its support for countries at TICAD7. Japan will also show what waste management initiatives African nations will be able to take in the short term while keeping down costs. The commitment comes with a move to renew a disposal site in the Hulene district of Maputo, capital of Mozambique, where in February 2018 effects from heavy rain at a dumping site caused towering piles of garbage several dozen meters high to collapse. The incident killed 16 people including children living in the vicinity. Under a model project set to be launched by the Japanese government at the Hulene district waste disposal facility possibly within the year, Japan’s Ministry of the Environment and JICA will work in tandem with UNEP. Expertise from Japan’s developments in waste disposal management that will be shared and implemented on the site includes putting large accumulations of rubbish in a low inclining pile to avoid toppling, as well as the introduction of pipework to improve drainage.

  10. Rwanda secures Rwf86 billion JICA loan to transform agriculture. Rwanda has borrowed 10 billion yen (Rwf86 billion) from Japan in order to tackle malnutrition through agriculture transformation. The loan agreement was signed yesterday between Uzziel Ndagijimana, Minister of Finance and Economic Planning and Shin Maruo, Chief Representative of JICA at the ministry headquarters in Kigali. Ndagijimana told reporters that it is a highly concessional loan – extended on terms substantially more generous than market loans – with an interest rate of 0.01%, to be repaid in 40 years, and a 10-year grace period. Ndagijimana said: “This programme will boost government efforts to modernise our agriculture, an area where Japan has been actively contributing. Cooperation with the government of Japan has been growing strong over the years through project support.” Ndagijimana said it was the first time the government of Japan was giving Rwanda a loan through budget support. This, he said, was evidence of the Japanese government’s trust in Rwanda’s budget support modality. The programme will start in October and run for three years.

Japan-Africa, TICAD7 Quick Links:

Egypt: About 50 high level Egyptian companies and several ministers will accompany President Abdel Fattah Al-Sisi

Japanese investments in Egypt hits $880m; increases by 74.3% in FY 2017/2018

JICA’s Egypt office chief representative Yoshifumi Omura discusses bilateral ties

Tanzania: Japanese envoy calls for speed in work permits issuance to aid FDI

Japan pledges to invest in Kenya’s blue economy

Zimbabwe urged to leverage on Japan-Africa Summit

Tanzania’s Bwama village: An old Japanese idea brings medicine to rural Africa

DRC: Japan gives $5m in emergency aid to fight Ebola outbreak

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This post has been sourced on behalf of tralac and disseminated to enhance trade policy knowledge and debate. It is distributed to recipients across Africa and internationally, serving in the AU, RECs, national government trade departments and research and development agencies.

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