Building capacity to help Africa trade better

tralac’s Daily News Selection


tralac’s Daily News Selection

tralac’s Daily News Selection

Trade and development events to diarise:

  1. Africa Forum on Mining (13 November, Accra). The forum will launch a regional platform, where African countries, regional organizations and continental institutions will discuss issues of strategic importance for the mining sector in Africa, and for Africa.

  2. Can Special Economic Zones drive growth in urbanising Africa? (13 November, Johannesburg)

  3. The XI BRICS Summit starts tomorrow in Brasilia (see below for further details)

  4. The African Industrialisation Week 2019 (18-22 November, Addis Ababa)

  5. The UAE’s Global Business Forum on Africa 2019 (18-19 November, Dubai)

MSMEs and trade statistics: informal working group on MSMEs (WTO)

The following communication, dated 12 November 2019, is being circulated at the request of the Coordinator of the Informal Working Group on MSMEs. The purpose of this submission is to kick-off discussions on the importance of trade statistics linked to firm-size characteristics for understanding MSME-trade with the view of developing possible language for a Ministerial Declaration.

Draft recommendation on cybersecurity for MSME traders: Recognizing that current trade data has limitations for analysing MSME-specific participation in international trade; Acknowledging that value chains are an important entry point for MSME international trade integration; Seeking a better understanding of the role of MSMEs in global value chains; Desiring increased coordination and granularity of trade data;

Recommends that: Members encourage national efforts to gather trade statistics that include enterprise characteristics (such as information on firm size) to better understand MSMEs’ roles in global value chains and the impact of policies aimed at increasing MSME integration in international trade; Members support efforts at the OECD to expand the TiVA database to include more detailed statistics, including enterprise characteristics.

Barclays Ghana to hold first Absa AFCFTA conference in 2020 (GhanaWeb)

Barclays Bank Ghana, part of the Absa Group, has declared its intentions and committed to organise the first AFCFTA conference in 2020 under the auspices of the Office of the President. This was announced by the Managing Director of Barclays Bank, Mrs Abena Osei-Poku at the opening session of the 8th Ghana Economic Forum, which was lead-sponsored by Barclays Bank and held in Accra on 30 October. According to the Bank, the Absa AFCFTA conference is in response to President Nana Addo Dankwa Akufo-Addo’s call for Ghanaians to support the AFCFTA to harness the opportunities that intra-Africa trade provide for economic growth and transformation. The AFCFTA conference, she noted, will contribute to positioning Ghanaian businesses appropriately to benefit from the continent’s free trade agreement. According to her, Absa has deep insights and understanding of the African continent and “we intend to use these expertise to drive and stimulate the right engagements between governments and the private sector.”

Ronak Gopaldas: Can African leaders put free trade above nationalism? (ISS)

The issue of sovereignty and ceding trade decision-making powers to a centralised body will be particularly challenging in Africa, where the election cycle and political and presidential churn is relentless. Despite several similarities with the US and Europe, the African situation is also unique, and a smooth transition to free trade is unrealistic. Political will and the maturity to compromise will determine whether the free trade agreement succeeds. Achieving the ratification of the AfCFTA shows that such positive change is possible. Already countries have made concessions in getting the deal signed, and more will have to be made in its activation. Free trade agreements are complex and fragile treaties, and their impact is only as strong as the willingness of signatories to adhere to the rules. In order to move from theory to practice, Africa needs to reject nationalism and fully embrace a pan-African vision that could catapult the continent not only to a higher growth path and real-world prosperity, but significantly elevate its global leadership and standing.

Tanzania: Exports value increase 5.2% (Daily News)

The value of goods and services exports rose by 5.2% to over 21tri/-($9,205.2m) in the year ending September due to increase in services receipts and value of non-traditional goods exports. The Bank of Tanzania monthly economic review for October shows that the export of non-traditional goods was 9.18tri/-($3,991.9m), higher than 7.41tri/- ($3,222.1m) in the corresponding period in 2018. Earnings from all major categories of non-traditional goods exports increased, except for fish and fish products, and re-exports. Export of gold accounted for 48.6% of nontraditional goods exports and increased by 26.1% to 4.46tri/- ($1,940.3m) on account of volume and price effects. Export value of manufactured goods grew by 32.6% to 2.37tri/- ($1,032.4m), driven by exports of sisal products, iron and steel, glass and glassware, manufactured tobacco, and fertilizers. Traditional goods exports declined to 1.29tri/-($563.5m) in the year ending September from 2.66tri/- ($1,160.8m) in the corresponding period in 2018, as all traditional goods declined, save for coffee and tea. [Access the BoT October monthly economic review (pdf); Related: Goods, services imports up]

Ghana, Cote d’Ivoire cocoa partnership yielding dividends – Akufo-Addo (GhanaWeb)

The strategic partnership entered into between Cote d’Ivoire and Ghana has begun yielding dividends in cocoa production and marketing policy, President Nana Akufo-Addo has said. A living income differential of $400 per tonne will be paid to farmers for all categories of cocoa beans from Ghana and Cote d’Ivoire for the 2020/2021 crop season when implementation of the new price mechanism begins. Under that, cocoa from the two countries will be sold $2,600 per tonne. This policy, Nana Akufo-Addo said, has found support even from major chocolate producers like Mars, who recognize the need to make the cocoa industry sustainable. He made this known at the African Investment Forum’s “Invest in Africa’s Space” event, on Monday when a question was posed to him. With Ghana and Cote d’Ivoire responsible for 65% of the world’s output of cocoa, and with the global chocolate industry worth some 100 billion dollars, he noted that it is not right that the farmers, whose hard work and toil is responsible for growing the cocoa, get only 6 billion dollars for their effort. [Reuters: Ghana sells 200,000 tonnes of cocoa with farmer premium]

Egyptian exports expected to rise 20% by end of 2019 (Ahram)

Egypt’s exports are expected to rise by 20% by the end of 2019, Egypt’s Minister of Trade and Industry Amr Nassar said, adding that Egypt’s Sustainable Development Vision 2030 targets an increase in the macroeconomic indices, including the export sector as a key source of hard currency. Nassar made his statements during his participation in the Egypt Economic Summit on Tuesday on behalf of Prime Minister Mostafa Madbouly. Nassar explained that the government has undertaken legislative and structural reforms including new laws and amendments, including an amendment to the investment law, a new industrial licenses law, a competitiveness protection law, as well as laws on customs system and SME development.

Dubai’s DP World signs deal to develop business park in Namibia (Reuters)

Dubai’s DP World has signed a preliminary agreement with the Nara Namib Free Economic Industrial Zone to develop a dedicated business park in the Namibian port town of Walvis Bay. The park will be a ‘free economic zone’ for industry and logistics and initially cover an area of 50 hectares, according to a statement on Dubai’s government media office website on Tuesday. The park could eventually be spread across 1,500 hectares, it said. DP World and Nara Namib aim to reach a final agreement in the second quarter of 2020, the statement said.

Africa Energy Outlook 2019 (IEA)

The new report is the IEA’s most comprehensive and detailed work to date on energy across the African continent, with a particular emphasis on sub-Saharan Africa. It includes detailed energy profiles of 11 countries that represent three-quarters of the region’s gross domestic product and energy demand, including Nigeria, South Africa, Ethiopia, Kenya and Ghana. The report makes clear that Africa’s energy future is not predetermined. Current plans would leave 530 million people on the continent still without access to electricity in 2030, falling well short of universal access, a major development goal. But with the right policies, it could reach that target while also becoming the first continent to develop its economy mainly through the use of modern energy sources. Drawing on rich natural resources and advances in technology, the continent could by 2040 meet the energy demands of an economy four times larger than today’s with only 50% more energy.

For this report, the IEA developed a new scenario that analyses how the energy sector can spur Africa’s growth ambitions while also delivering key sustainable development goals by 2030, including full access to electricity and clean cooking facilities. The Africa Case is based on Agenda 2063, African leaders’ own strategic framework for the continent’s economic and industrial development. Economic growth in the Africa Case is significantly stronger over the next two decades than in the scenario based on today’s stated policies, but energy demand is lower. This is linked to an accelerated move away from the use of solid biomass (such as wood) as a fuel and to the wide application of energy efficiency policies. The IEA has been monitoring Africa’s energy sector closely for a long time: IEA analysis of energy access issues on the continent began in 2002 and is set to expand significantly. This new report comes at an important time in the IEA’s deepening engagement with Africa. In May, the IEA and the African Union Commission co-hosted their first joint ministerial summit at which the two organisations signed a Memorandum of Understanding to guide future collaboration. A second ministerial forum will be held in 2020. [Various downloads available]

WTO ruling against export incentives: Should Indian exporters be worried? (Business Standard)

A WTO dispute panel ruled on 31 October that India’s key export promotion schemes violated WTO rules and hence should be withdrawn within six months. The verdict has raised several questions. What will be the impact of the ruling for India? Will Indian export of steel products, pharmaceuticals, chemicals, information technology products, textiles and apparel continue to be competitive in the absence of this subsidy? Is the ruling final? The short answer is that the ruling, in itself, does not pose an immediate threat to Indian exports. Before we come to explain why, let’s understand some basics:

Indo-Pacific Business Development Mission: remarks by Commerce Secretary Wilbur Ross (DoC)

The Trump Administration is extremely engaged and fully committed to this region for a simple reason: The United States is an Indo-Pacific Nation. Two-way trade between the US and the Indo-Pacific Region increased by almost 6% last year to a record of almost $2 trillion. This amount is larger than the economies of all but eight countries in the world. That two way-trade figure of $2 trillion far surpasses US trade with Europe, at $1.5 trillion; US trade with South and Central America, at $1.2 trillion; and US trade with Africa, at $89 billion.

BRICS trade ministerial: India’s Minister of Commerce and Industry & Railways, Piyush Goyal

Commerce and Industry Minister in his address, in the session on Advancing BRICS Trade and Investment Cooperation- the Road Ahead, urged the BRICS countries to develop digital infrastructure, skills and institutions with special focus on the developing countries and LDCs while highlighting the adverse impact of predatory pricing that is practised by some e-commerce players that adversely affects millions of small retailers. He reiterated that e- commerce players must follow the letter and spirit of the law of the country. In his address the Commerce and Industry Minister also spoke about the need to ensure that the WTO reform process does not dilute the basic principles like Special and Differential Treatment to developing countries and consensus-based decision making. He urged the BRICS countries to collectively take the lead in shaping the narrative on reforms within the WTO in order to enhance its relevance and effectiveness in the contemporary technological and trade environment.

The Commerce and Industry Minister in his closing remarks at the Trade and Industry Minister’s meeting said that the MoU amongst BRICS Trade and Investment Promotion Agencies signed at this meeting provides a framework for forging collaboration between countries and facilitating greater trade amongst BRICS member countries. He expressed his confidence that the MoU will further promote trade and market studies and will narrow gaps in trade facilitation measures in BRICS countries. Piyush Goyal urged all BRICS member countries to maintain the momentum in all the areas agreed upon during the Brazilian Presidency especially cooperation initiatives in MSMEs, Intellectual Property Rights, e- commerce, technical regulations, investment facilitation and trade and investment promotion as cooperation through these frameworks will encourage value added outcomes for stakeholders.

XI BRICS Summit: In the closed session, the discussions are expected to be focused on challenges and opportunities for the exercise of national sovereignty in the contemporary world. This will be followed by the BRICS Plenary Session where the leaders will discuss the intra BRICS cooperation for the economic development of BRICS societies. Thereafter Prime Minister shall participate in the meeting of the BRICS leaders with BRICS Business Council where in the Chairman of the Brazilian BRICS Business Council and the President of the new Development Bank are expected to submit reports. Immediately thereafter a BRICS MoU between Trade and Investment Promotion agencies will be signed. [Related: President Ramaphosa to lead SA’s delegation to the 11th BRICS Summit, Deutsche Welle: Have the BRICS hit a wall?, BRICS, one decade later: Has the hype matched the substance?]


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