Building capacity to help Africa trade better

tralac’s Daily News Selection


tralac’s Daily News Selection

tralac’s Daily News Selection

COVID-19: trade and REC updates

  1. South Africa: International Trade Administration Commissioner Meluleki Nzimande told Fin24 that the trade administration body would follow the lead of government and Minister of Trade and Industry Ebrahim Patel when when responding to the coronavirus pandemic. Speaking to reporters during a post-cabinet briefing on Thursday, Minister in the Presidency Jackson Mthembu said a special Cabinet meeting would be held on Sunday to discuss each Cabinet portfolio’s response to coronavirus, which would inform government’s overall intervention. Nzimande said it was too soon to tell the degree of impact, if any at all, that the coronavirus pandemic would have on trade volumes, especially when it came to South African exports to other markets: “ITAC conducts trade monitoring on a long-term basis and since the coronavirus is a recent occurrence, there is currently no trade analysis yet with regards its impact on trade. The impact will however be taken into account in the future when the trade monitoring exercise is undertaken.”

  2. SADC: Statement following an extra-ordinary meeting of SADC Ministers of Health. The meeting agreed that member states will establish coherent mechanisms of sharing information on issues of transboundary public health concern, and that the Technical Committee for Coordinating and Monitoring the Implementation of the SADC Protocol on Health comprising of directors of public health and directors of medical services be reestablished, and its terms of reference be expanded. The meeting recommended a temporary suspension of SADC regional face-to-face meetings and encourage utilization of modern technology.

  3. EAC: Due to the outbreak and rapid spread of the novel coronavirus, the East African Community has postponed the 21st EAC Summit until further notice. All other meetings and activities of EAC that require large gatherings have also been suspended.

  4. WTO’s MC12: Together with the Chair of the General Council, Ambassador David Walker, and in consultation with the delegation of Kazakhstan, DG Azevêdo circulated a note to members saying that “it is our considered view that holding MC12 as previously agreed from 8-11 June will not be feasible”. In light of this development, DG Azevêdo said that he and the chair of the General Council will consult with WTO members, including through a special General Council meeting to be held as soon as conditions permit, on how to proceed with revised arrangements for MC12.

  5. According to China Ports & Harbours Association, for the week of 2 – 8 March, the container throughput of the eight major container ports increased 9.1%. Among them, the growth rate of Dalian, Tianjin, Qingdao and Guangzhou increased 10%. The overall growth rate of Bohai-rim ports is faster than other coastal ports.

Namibia: Annual trade statistics bulletin 2019 (pdf, NSA)

In 2019, Namibia overall trade (total of exports and imports) amounted to N$203,019 million, slightly lower (0.4%) than 2018 level of N$203,744 million. The exports revenue were N$91,766 million showing a 1.5% decline from last year. While, the imports bill stood at N$111,253 million, an increase by 0.7% from N$110,620 million last year. Subsequently, the decline in exports and the increase in imports resulted in a trade deficit of N$19,487 million, widening from its 2018 level of N$17, 496 million.

Namibia’s trade continues to be highly concentrated to a few countries and commodities. For our export market, the ten leading trade partners (China, South Africa, Botswana, Belgium, Spain, Zambia, UAE, DRC, Italy and the Netherlands) represented 80.7% of total exports. In terms of imports the 10 leading countries (South Africa, Zambia, China, Bulgaria, India, Botswana, USA, Peru, DRC and Chile) constituted 80.5% of total imports. This shows Namibia’s dependence on a few countries for its exports as well as for meeting its import requirements. The commodities traded in 2019 were also concentrated to a few commodities with the 10 leading export commodities accounting for 86.5% of total exports while on the imports side the ten leading commodities represented 65.9% of total imports. Hence there is a need for Namibia to diversify her export basket to mitigate the risks associated with the lack of diversification.

In terms of the mode of transport that our traders used for transporting goods in and out of Namibia, the seaborne was the most preferred mode of transport in 2019 for our exports accounting for 55.7% of total exports ahead of airborne and road bound that represented 23.1% and 22.4%, respectively. On the other hand, on the import side the road bound was the most preferred mode of transport accounting for 63.3% of imports followed by seaborne with 32.4% and airborne with 4.4%.

Nigeria: Foreign trade in goods statistics, Q4 2019 (pdf, NSA)

In Q4 2019, the value of total trade was N10.1trillion, or 10.2% higher than the value recorded in Q3, 2019 and 25.9% higher than in Q4 2018. On an annual basis, the value of total trade in 2019 was recorded at N36,152.1 billion, representing a 14.05% increase over 2018.

Total imports stood at N5,349.63 billion in Q4, 2019 representing an increase of 37.2% over the value recorded in Q3,2019 and 49.34% over the corresponding quarter of 2018. In 2019, total imports grew by 28.8% compared to 2018. The value of imported agricultural goods decreased by 2.8% in Q4, 2019 compared to Q3 but rose 6.6% compared to the corresponding quarter in 2018. The value of agricultural imports in 2019 was 12.7% higher than in 2018.

Total export value was 9.79% lower in value in Q4, 2019 compared to Q3,2019 but 7.06% higher relative to Q4,2018. In 2019, the value of total exports was 3.56% higher than in 2018. Agricultural goods exports grew in value by 61.89% in Q4, 2019 compared to Q3,2019 but decreased by 30.23% when compared with Q4,2018. In 2019, the value of agricultural goods exports fell 10.74% relative to 2018. Manufactured goods exports in Q4,2019 were 48.9% less in value than recorded in Q3,2019 and 573.19% higher than Q4,2018. In 2019, the value of manufactured goods exports was over 200% higher than in 2018. Crude oil exports in Q4,2019 were 3.16% lower than the value in Q3, 2019 and 0.88% lower than Q4,2018. For 2019, the value of oil exports was lower than in 2018 by 3.08%.

  • Major export trading partners and percentage share in Q4: India (13.17%), Spain (10.35%), France (7.78%), Netherlands (7.47%), Ghana (7.40%)

  • Major import trading partners and percentage share in Q4: India (22.57%), China (20.49%), United States (9.05%), The Netherlands (8.61%), Belgium (5.76%)

Beyond good intentions: The new EU-Africa partnership (ECDPM)

The paper looks at six thematic priorities of the partnership – some longstanding and some more recent: jobs, investment and trade, climate change, digitalisation, peace and security, democracy and human rights, migration and mobility. It examines common and diverging interests, the status of cooperation and the potential way forward across these different areas. Extract (pdf):

While the EU has multiple instruments for facilitating investment in Africa, none of these is truly in partnership with the AU or other African institutions. The EU and AU could consider developing a joint continental investment platform, bringing together the international financial institutions (IFIs) and other policymakers from both the EU and Africa, to design jointly investment programmes.

The EU and many of its member states are worried about Chinese competition in African countries, and seek to lock African markets into the European sphere of influence. However, African countries are eager to increase the volume and quality of trade and investment, including through increased competition between investors where useful.

There are also good prospects for cooperation in the agricultural sector, but perspectives might slightly differ between the EU and Africa, especially without transformation of the traditional investment and trade patterns (mostly foreign direct investment in large scale farming and incentives to export raw commodities from Africa). Crucially, the EU’s External Investment Plan and other EU member states’ bilateral blending initiatives and instruments should be coordinated for the concrete benefit of those who depend on agriculture for their livelihoods.

On trade, there is a strong perspective for cooperation on supporting implementation of the AfCFTA, including through investments in infrastructure and continued support for the practical aspects of implementing it. The prospect of a continent-to-continent trade agreement could also provide the framework to rationalise the EU’s various trade agreements with Africa. While at present African countries have differing interests regarding their trade relationships with Europe and thus have no appetite for a one-size-fits-all approach to a trade agreement with Europe, most African countries do want preferential access to the European market. [The authors: Alfonso Medinilla, Chloe Teevan]

Frank Matseart: Great benefits when Africa becomes a single market (The East African)

Effective implementation of AfCFTA would be transformational. The African Development Bank has forecast that elimination of bilateral tariffs on goods and services would increase intra-African trade by 15 per cent. Yet significant barriers remain beyond tariffs. Without a focus on implementation, we could see a trade agreement that is largely unusable. There is an urgent need to convert the strong political will driving the AfCFTA agenda into the delivery of concrete results. Effective trade facilitation initiatives include enhancing port efficiency (through improved infrastructure and operations); eradicating non-tariff barriers; introducing electronic systems that empower governments to increase collections, reduced clearance costs and improved trade infrastructure at border posts. These interventions tackle not just the symptoms but the root causes, and help countries to develop sustainable channels of growth that increase economic opportunity for citizens by creating jobs, improving transparency, accountability and the capacity for generating revenues. [The author is the TradeMark East Africa CEO]

IOTA Foundation, TradeMark East Africa partner up to improve infrastructure and trade through technology

As strategic partners, we share a common vision for improving trade through technology. The partnership will allow the IF to work with TMEA to spearhead initiatives on using the Tangle to: improve data management and collaboration along trade corridors; explore new ways to ensure digital solutions are inclusive and benefit both large corporations as well as smaller traders; work towards increasing the global competitiveness of East African products whether it is being more cost-effective or providing more transparent supply chains to the end consumer.

Revision to GDP methodology gives boost to Ivory Coast’s reported economy (Reuters)

Ivory Coast has revised how it calculates its gross domestic product, a move that resulted in a big jump in the reported size of its economy. The new methodology for determining GDP, which includes changing the base year for its calculation from 1996 to 2015, was approved in a cabinet meeting on Wednesday. “The economy has changed, we have new industries, new activities,” said Gabriel N’Guessan, head of the national statistics office. “We’re not at war anymore for example.” The economy has been one of the world’s fastest growing since peace returned after civil wars in 2002 and 2010-2011.

Burkina Faso is Ghana’s top food-export destination in West Africa (GhanaWeb)

Data from the Ministry of Food and Agriculture (MOFA) shows that Burkina Faso is Ghana’s top export destination for its foods in the West Africa region. From 2015 to 2019, Ghana has seen an increase in food export with a corresponding revenue of GH¢868.13 million. MoFA has credited the agricultural flagship programme, Planting for Food and Jobs for the rise in food export to neighbouring countries. Burkina Faso topped in the importation of varied foodstuff such as rice, pawpaw, palm fruit, sorghum, cowpea, gari, banana, groundnuts, yellow and white maize, amounting to 92,319.40 tonnes. Cote d’Ivoire came second for mainly importing yam, maize, cowpea, citrus and onions of 14,222.25 tonnes. Mali is the least on the table as it recorded export volume of 1,180.40 tonnes. In all, foodstuff with a volume of 563,859.33 tonnes, were exported to Togo, Cote d’Ivoire, Niger, Mali, Burkina Faso, Benin and Northern Nigeria over the period.

Chad P. Bown, Soumaya Keynes: Why did Trump end the WTO’s Appellate Body? (PIIE)

From 1 January 1995 until 10 December 2019, the world trading system had a relatively reliable referee. If one government reckoned that another had broken the rules, then instead of lashing out immediately on its own, it could complain to the WTO. After a first round of independent arbiters judged on which side was in the right, WTO members could appeal to the Appellate Body, which would deliver the final verdict. But now, because of the Trump administration’s refusal to appoint new members, that Appellate Body is defunct. Without a referee, the danger is that trade disputes blow up into trade wars. Why, then, has the Trump administration done this? One answer came on 11 February 2020, when the Office of the United States Trade Representative published the Report on the Appellate Body of the World Trade Organization. Over 174 pages, the report accused the Appellate Body of engaging in ultra vires actions (acting beyond its powers) and obiter dicta (going on and on). It complained about these adjudicators taking away members’ rights and adding new obligations, in ways that American policymakers had never intended when they signed up to the WTO.

From this body of lawyerly Latin one could easily conclude that the Trump administration is engaged in a philosophical legal debate. Perhaps this is about a clash of legal systems, with the American contract-based approach to international law pitted against a European one, where interpretation—or, in American eyes, misinterpretation—is more acceptable. Dig through the details, though, and it becomes clear that a key area of conflict is much less grandiose. In particular, one collection of judgments by the Appellate Body has caused special angst. In the section of the report titled “Appellate Body Errors in Interpreting WTO Agreements Raise Substantive Concerns and Undermine the WTO,” four of the five alleged errors concerned “trade remedies.” In other words, this is about tariffs. In a new essay, we explain why.


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