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tralac’s Daily News Selection

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

21 Oct 2019

Diarise:

  1. EAC Regional Meeting on Trade Facilitation (22-25 October, Dar es Salaam). The meeting, under the leadership of the EAC Secretariat with the participation of the Chairs of the NTFCs, Representatives of the Customs Authority and the East African Business Council, will ensure a coordinated and harmonized implementation process of the trade facilitation policies in the EAC region.

  2. In-country consultations, in Rwanda and Uganda, for the draft EAC Informal Sector Paper and the Corresponding Principles (22-26 October)

  3. 31st EAC Sectoral Council on Cooperation in Defence (22-26 October, Arusha)

Selected WTO documentation, now circulating:

  1. WTO work programme on small economies: proposal for ministerial decision (pdf). The following communication, dated 16 October 2019, is being circulated at the request of the delegation of Guatemala on behalf of the Group of Small, Vulnerable Economies.

  2. Feedback session on the WTO’s publications and online tools to disseminate tariff and import data: summary by the Secretariat

  3. Committee on Sanitary and Phyto-sanitary Measures: overview regarding the level of implementation of the transparency provisions of the SPS Agreement (revised Secretariat Note, pdf)


COMESA Common Market Levy: update

In a move to entrench financial independence and sustainable implementation of regional integration agenda in COMESA, a joint committee of ministers of finance and central bank governors have decided to set up a technical working group to assess and come up with modalities for the operationalization of the COMESA Common Market Levy. The meeting of the Joint Ministerial and Governors Committees took place on 16 October 2019 in Washington, DC on the sidelines of IMF/World Bank 2019 Annual Meetings. It was attended by Ministers of Finance and Governors of Central Banks from Djibouti, DR Congo, Egypt, Eswatini, Libya, Kenya, Malawi, Mauritius, Rwanda, Seychelles, Sudan, Tunisia and Zambia. Making the case for implementation of the common market levy, the Secretary General of COMESA, Chileshe Kapwepwe, emphasized the need to intensify efforts to deepen the process of macroeconomic convergence and financial intermediation in COMESA region given the current enormous challenges. “COMESA needs a guaranteed, predictable and adequate financial resources for the smooth execution of its regional integration agenda. Introducing the community levy is in line with COMESA Treaty provisions and will go a long way in raising significant resources for harmonious development of the region.” Similar regional economic communities such as ECOWAS and ECCAS have successfully implemented such levies for sustainable financing of their integration agenda. Former Deputy Chair of the AUC Mr. Erastus Mwencha, who is also a former Secretary General of COMESA was the key note speaker and shared insights on financing of regional integration in Africa in general, and the operationalization of the COMESA Common Market Levy, in particular.

China signs its first Free Trade Agreement with an African country - Mauritius (GoM)

Mauritius and China have strengthened their bilateral relations with the signature of a Free Trade Agreement on 17 October in Beijing. The Agreement is the first FTA which China has signed with a country of the African continent. The FTA which represents a major achievement for Mauritius will give the country access to a huge market of 1.4 billion inhabitants, with a GDP of some $13 trillion. The FTA will enable Mauritius to benefit from duty free access on the Chinese market on some 8,227 products, representing 96% of the Chinese tariff lines. The duties applicable on 88% of these tariff lines will be eliminated with immediate effect, while the remaining tariffs will be eliminated over a five to seven-year period. These products include key export items such as rum, frozen fish, noodles and pasta, wafers and biscuits, fresh fruits, juices, mineral water, linen, garments, watches and articles of leather. Mauritius struck a significant deal with China on special sugar, which is expected to generate export revenue of some $40m over a period of 8 years.

China agreed to grant Mauritius a Tariff Rate Quota of 50,000 tons market access for special sugar with an in-quota rate of 15%. As regards trade in services, Mauritius service providers will have access to more than 40 service sectors, including financial services, telecommunications, ICT, professional services, construction and health services. Mauritius will also be able to establish businesses in China as wholly owned entities or in joint partnership with Chinese operators. Furthermore, the FTA will create new investment opportunities in Mauritius targeting the Chinese market. Regarding the Economic Cooperation chapter of the Agreement, Mauritius and China have agreed to collaborate in 10 areas:

Xinhua update on the FTA: Mauritius will open up more than 130 sub-sectors in important service fields such as communications, education, finance, tourism, culture, transportation and traditional Chinese medicine to China. This is the highest level of opening up in the field of services in Mauritius so far. In the field of investment, the agreement has been greatly upgraded from the 1996 China-Mauritius bilateral investment protection agreement in terms of protection scope, protection level and dispute settlement mechanism. This is the first time that China has upgraded the previous investment protection agreement with an African country, which will not only provide stronger protection for Chinese enterprises to go to Mauritius, but also help them further boost investment cooperation in Africa through the platform of Mauritius, according to the MOC.

Togo’s AfCFTA implementation strategy: update

Aimed at promoting exports within the African market, industrial development and job creation, this national strategy also sheds light on Togo’s strategy for managing its overall participation in regional integration efforts. The strategy document, which was made possible by the contribution of several public and private sector organisations, institutions and actors, with the support of the ECA in collaboration with the African Union Commission, is based on an assessment of Togo’s trade performance and participation in intra-African trade. It also outlines the risks associated with the AfCFTA and potential mitigation measures. It also identifies the goods and services sectors that have comparative advantages for diversification as well as the development of priority value chains.

SADC Monitoring Control and Surveillance Coordination Centre: Angola becomes 8th SADC state to sign the Charter

Angola became the 8th State Party to the Charter establishing the MCSCC, joining Eswatini, Lesotho, Mozambique, Namibia, South Africa, Tanzania and Zambia. Two thirds of SADC Member States are required to sign the Charter for it to enter into force. Angola’s Minister of Fisheries and Sea of the Republic of Angola, Honourable Dr Maria Antonieta Josefina Sabina Baptista, encouraged the SADC Secretariat to continuously engage Member States which have not signed the Charter to do so, to enable the region to realize the commitment to fight IUU fishing through establishment of the MCSCC. She also committed to engage other Ministers to commit to signing of the Charter in order to strengthen cooperation and capacity to stop illegal fishing and to build sustainable blue growth in the SADC region.

DP World’s Kigali Logistics Platform opens

The facility, which has been operational since September 2018 in test mode, has an annual capacity of 50,000 TEUs. When operating at full capacity, it has the potential to save Rwandan businesses up to $50 million a year in logistics costs. Since the commencement of its operations in the Rwandan capital last year, Kigali Logistics Platform has reduced truck-turnaround time which used to be an average of 10-14 days to just 3 days. Kigali Logistics Platform serves as a gateway to the heart of Africa, connecting Rwanda to neighbouring countries including he DRC, Burundi, Uganda, Tanzania and Kenya. The facility will also access the port of Mombasa in Kenya and Dar Es Salaam in Tanzania, securing two trade gateways to the sea. The railway from Mombasa port in Kenya will pass through Uganda to Rwanda and also the railway from Dar Es Salaam to Kigali is under construction and will have its final cargo rail siding located at Kigali Logistics Platform. Linking railways to the Kigali Logistics Platform has the potential to dramatically reduce logistics costs for exports and imports via international gateways on the coast. At present it costs three times more to transport a container from Kigali to Dar Es Salaam as it does to transport the same container from Dar Es Salaam to Shanghai.

How did Cotonou become an attractive port of entry for Nigerian importers even when Nigeria has the largest ports in West Africa? Why do Nigerian importers prefer Cotonou to Lagos ports? In an attempt to answer some of these questions Saturday Vanguard within the week, had several interactions with several importers whose many containers are either incurring demurrage at the Cotonou ports or rotting on the queue to enter Nigeria at Seme due to the border closure. They offered some insightful explanation of the issue.

Lesotho: World’s second-biggest mohair industry restarts as monopoly ends (Bloomberg)

Mohair sales in Lesotho, which produces a fifth of the world’s supply of the luxury fiber, have restarted after the government buckled to pressure from farmers and ended a controversial monopoly handed to a Chinese entrepreneur. The first auction conducted by locally-owned Maluti Wool and Mohair Centre took place on 7 October and the first shipments of the fiber were made 17 October, said David Telford, the company’s managing director. Record prices were achieved and farmers will be paid by 28 October, he said. The sale eases a crisis that left most of an estimated 48,000 wool and mohair farmers without earnings for more than a year after Guohui Shi and his Lesotho Wool Centre were unable to pay for the product they bought. Wool and mohair are Lesotho’s main exports. Shi didn’t answer a call made to his mobile phone.

Sacramento conference promotes California-Africa trade

One of the main goals of the conference was to start to reestablish a permanent office to facilitate and promote California-Africa trade. The state used to have an office based in South Africa, but it was closed to save money when Arnold Schwarzenegger was governor. Grant Harris, who runs a private consulting firm helping US companies do business in Africa, spoke at the opening reception for the conference on Tuesday about the potential on the continent. “We need to think about the many diverse markets across Africa,” he said. Previously Harris worked in the White House as the principal adviser on African affairs for President Barack Obama. He said that US businesses tend to be more likely to invest in markets they’re already familiar with, like Europe. “Everyone says capital is cowardly,” he said. “Many investors, particularly in the West, overestimate the risk of investing in African markets.” Last year, California exported more than $1bn worth of goods to the continent, with electronics, machinery, chemicals and agriculture as some of the biggest commodities.

Today’s Quick Links:

Mauritius-Kenya: Expansion of the Double Taxation Avoidance Agreement network

Mauritius has becomes the 42nd State Party to the AU Convention on Preventing and Combating Corruption

Six COMESA states take steps to access climate change funds

Nigeria, Africa’s biggest oil producer, can’t beat fuel-imports addiction

South Korea to discuss developing nation status with US

China seeks $2.4bn sanctions against US for not complying with WTO ruling on Obama era tariffs

Euractiv trade debate: A new trade policy with teeth and muscle

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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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