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tralac’s Daily News Selection

tralac’s Daily News Selection
Photo credit: DIRCO

10 Feb 2020

AU Summit updates:

Featured tweet by Prudence Sebahizi (Head of AfCFTA Interim Secretariat): Congratulations to HE Mr Wamkele Mene, SG of the AfCFTA Secretariat. Young and vibrant African with extensive knowledge of international trade.

Action points from President Cyril Ramaphosa’s acceptance statement on assuming the Chair of the AU for 2020

As incoming AU Chair, we have set ourselves key priorities to enhance the progress that is already underway during the African Decade of Action. We would like to deepen our work together in deepening the unity of our continent and advancing inclusive economic growth and sustainable development. Our collective work to ensure political and economic unity, good governance, and peace should be strengthened by supporting integration, industrialization, economic development, trade and investment. We will host the 13th Extraordinary Summit on the AfCFTA, to be held back-to-back with the Extraordinary Summit on Silencing of the Guns in May 2020.

Working closely with President Mahamadou Issofou of Niger in his capacity as the AU Champion on the AfCFTA, we will work for the finalization of outstanding issues around the agreement. We must all ensure that the AfCFTA does not become a conduit for products with minimal African value addition to enter and penetrate our local markets under the guise of continental integration. There must be a reasonable standard set for what constitutes a product that is Proudly Made in Africa. We have to level the playing field for African businesses, so they are able to operate in a large-scale market unfettered by regulatory fragmentation. This is an integral part of rebalancing global trade relations. The era of economic colonialism and imperialism, under which Africa is a pit stop in the global assembly line, has passed.

The success of the AfCTFA depends on infrastructure development. We must all drive the implementation of the Presidential Infrastructure Champion Initiative, so that priority and high-impact projects act as catalysts for the AfCFTA. Beyond trade integration, we have trained our sights on supporting green growth on the continent, and on ensuring that the continent takes advantage of the opportunities presented by the green transition.

South Africa will host the Extra-Ordinary Summit on Silencing of the Guns to look at the implementation of the AU Master Roadmap, and at the same time respond to emerging circumstances on the African peace and security landscape.

The 4th Industrial Revolution presents our continent with great opportunities. To give full effect to our attention to this important area of work, we should look to establish an Africa Artificial Intelligence Forum, that also includes the diaspora.

We intend to work closely with President Akufo-Addo of Ghana to ensure the interests of women are mainstreamed, and want the years 2020 to 2030 declared as the Decade of African Women’s Financial and Economic Inclusion. [Related: President Ramaphosa assumes Chairship of the African Peer Review Mechanism]

pdf Conditions for success in the implementation of the AfCFTA (6.86 MB)

This particular study – AfCFTA conditions for Success – provides both an analytical framework as well as an actual analysis on local and international factors likely to either augment or hinder implementation of the AfCFTA, and therefore gives an evidence-based understanding and capacity to make specific local policy and investment decisions. The study can further guide interventions aimed at strengthening and aligning related institutional and human capital needs using integrated, cross-sector and transboundary approaches. Using the International Futures Modelling Tool, the study presents, for planners, policy makers and development specialists, a uniquely African perspective and foresight analysis to help in evidence-based prioritization and determining of national or regional AfCFTA implementation pathways – also connecting between individual and collective (regional) Member States’ implementation efforts. Success of the AfCFTA is cardinal to the success of Agenda 2063.

Tariffs: Today, Central African Republic, Chad, Comoros, and Democratic Republic of the Congo are all estimated to depend on intra-African tariffs for more than 5% of total government revenue. Figure 3 shows that at its peak in 2025, 24 countries are projected to experience net losses in revenue greater than 1% relative to the Current Path. These intra-African tariff-dependent countries are likely to face a challenging period of adjustment over the medium term. However, most countries that experience net revenue losses also quickly enjoy GDP gains that fully offset those losses.

At the continental level, by the mid-2030s, total gains surpass and begin to rapidly outpace losses, such that by 2063 African economies are projected to receive an additional $500bn in annual revenue relative to a scenario without AfCFTA. This value is roughly 140 times the amount necessary to compensate the few countries that do not fully make up tariff revenue losses. In addition, while countries heavily dependent on intra-African trade tariff revenues will see short-run disruptions to government revenue generation, they also experience much greater long-term economic gains relative to countries that have less of a short-run dependence on trade tariff revenue.

While the GDP and revenue gains suggested by this analysis are more than enough to outweigh the losses, since intra-African tariffs are already relatively low, their removal alone may not be enough to generate transformative change and significantly increase intra-African trade. [Politico: An all-Africa free-trade deal to warm the EU’s heart]

Ghana: Government spends $3m on AfCFTA

A total amount of $3m has been used by government to facilitate Ghana’s preparation towards the AfCFTA. According to President Nana Akufo-Addo, the money was used for the establishment and operationalization of the AfCFTA which he announced will take full force in March 2020. “The Government of Ghana sponsored six different meetings of the AfCFTA in December 2019, in Accra. Thus far, a total amount of $3m has been advanced by the Government of Ghana for the establishment and operationalization of the AfCFTA Secretariat”, President Akufo-Addo noted. Earlier on Sunday, President Akufo-Addo held a meeting of Member States of the Commission on Science and Technology for Sustainable Development in the South (COMSATS). With Ghana serving as Chair of COMSATS, the President told Heads of State and representatives of 27 member states that the purpose of the meeting was to ensure that member states recommit themselves to the work of COMSATS, and to reposition the Commission to support the collective drive for development, leveraging science, technology and innovation. The meeting served as a precursor to the General Meeting and the Forum on Science and Technology (14-15 April, Accra).

President Paul Kagame: Progress has been made towards reforming AU

“We have indeed come a long way since January 2017. A clear consensus has been forged around the need for an effective and self-sustaining African Union,” Kagame told leaders in a closed session on the sidelines of the 33rd Ordinary Session of the Assembly of the AU. Kagame also added that the budget process is more transparent and the burden is more evenly shared among member states. “More than $150m have been contributed to the Peace Fund over the last three years and the Board of Trustees is now in place,” he said. Kagame added that there has been progress in reforming the structure of the Commission, to make it leaner and more efficient. “The new structure has been endorsed by the Executive Council and it has been put before us for adoption,” he said, adding that the Panel of Eminent Persons for the selection of the senior leadership of the Commission is now in place. As the reformed selection process unfolds this year, we look forward to electing Africa’s best talent to lead the African Union Commission in the next term. The success of this selection process will mark a key milestone in the implementation of the institutional reform as a whole,” he noted. [Related: AU elects Kagame to drive Africa 2063 Agenda]

Don’t use AU Peace Fund to subsidise UN Security Council mandate, Buhari warns

President Muhammadu Buhari has reminded African leaders that the African Union’s Peace Fund was established to support internal peace arrangement within the continent and not to subsidise the mandate of the UN Security Council. President Buhari, who stated this at the high level meeting of African Union Peace and Security Council on the state of peace and security in Africa at the 33rd AU Summit in Addis Ababa, commended the renewed vigour by ECOWAS member countries to mobilise own resources to combat terrorism. The President, in a statement by his Senior Special Assistant on Media and Publicity, Mallam Garba Shehu, announced that Nigeria has fulfilled its financial obligations to the AU Peace Fund up to 2019. Speaking on ECOWAS matters, President Buhari declared that Nigeria was proud to continue to serve as a strong contributor to the peace roles played by the regional bloc. “In Burkina Faso, we (ECOWAS) pledged to mobilise $1bn to address the challenges of insecurity in our region and the Sahel. In Guinea Bissau, ECOWAS successfully midwifed the general elections,” Buhari said.

Seychelles signs the Africa Medicine Agency Treaty

The Department of Foreign Affairs said today that the treaty was signed by Seychelles’ Vice President Vincent Meriton on the sidelines of the 33rd ordinary session of the African Union Assembly. During the weekend the Seychelles also acceded to and became the 40th member of the African Peer Review Mechanism.

Extraordinary session of ECOWAS leaders: Burkina Faso President heads ECOWAS committee to investigate Nigeria’s border closure

The Authority of ECOWAS Heads of State and Government has constituted a committee, headed by President Roch Kabore of Burkina Faso, to study and make a full report on Nigeria’s land border closure with her neighbours. The decision to set up the committee was agreed Sunday night in Addis Ababa, Ethiopia, at an extraordinary session of ECOWAS leaders convened on the margins of the 33rd AU Summit to discuss the issue and other pressing regional matters. Nigeria’s Foreign Minister, Geoffrey Onyeama, told journalists after the three-hour closed door ECOWAS session that ‘‘The President of Burkina Faso is charged with undertaking a full study of the situation, make a report and then we take it from there.’’ Asked when the report will be presented to ECOWAS Heads of State and Government, the Nigerian minister replied: ‘‘As soon as possible, there are no timelines. But he is supposed to start very quickly, study the situation from all the affected countries and present his report.’’

Mr Onyeama also said the meeting attended by President Buhari and chaired by the ECOWAS Chairman, President Mahamadou Issoufou of Niger Republic, also discussed West Africa′s new single currency, the Eco, and the situation in Guinea Bissau after the presidential election. On the Eco currency, the foreign minister said: “Nothing has changed in respect of Nigeria’s position.”

Luanda MoU: Rwanda, Uganda ministers meet at Gatuna border (New Times)

Rwandan officials met with their Ugandan counterparts at the Gatuna border on Friday for a joint planning meeting ahead of the forthcoming summit between presidents Paul Kagame and Yoweri Museveni. The heads of state are scheduled to meet on the 21 February, as both countries seek to mend broken relations, as agreed by at the recent heads of state meeting. According to available information, the preparatory meeting on the Rwandan side was led by Minister Claver Gatete, the Minister of Infrastructure while on the Ugandan side it was led by General Katumba Wamala, the Ugandan Minister for Transport. Uganda’s ambassador to Rwanda, Oliver Wonekha and the Angolan ambassador to Rwanda, Eduardo Octávio also attended the meeting. The meeting is a follow-up on a quadripartite summit, the third of its kind, which took place earlier last week between the two presidents hosted by President Lourenço of Angola. The meeting was also attended by President Tshisekedi of the Democratic Republic of Congo.

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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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