tralac Daily News
The United Kingdom (UK) is South Africa’s 5th largest trading partner with total trade amounting to R110 billion in 2019. This is up from R73 billion in 2014. Total two-way trade in goods between SA and the US grew from $7.3bn in 2001 to a peak of $16.3bn in 2011. Since then, bilateral trade declined steadily, to $12.3bn in 2019.
pdf Presentation (340 KB) by Ambassador Xavier Carim, Deputy Director General, Trade Policy, Negotiations and Cooperation Branch, dtic
The Minerals Council South Africa says a comprehensive “toolbox” of measures is needed to improve the competitiveness of the entire chrome value chain, which has been impacted by a number of challenges. These challenges include nearly 40% of South Africa’s ferrochrome production having either been closed or mothballed in the past two years, as well as the significant 523% rise in the price of electricity over the past decade and shortages of electricity supply that have affected the production of mining companies and materially eroded the competitiveness of the ferrochrome industry.
Mini-budget: A tough balancing act (SAnews)
Finance Minister Tito Mboweni faces a tough juggling act this afternoon, when he presents the 2020 Medium Term Budget Policy Statement (MTBPS) in Parliament. The MTBPS will be his second budget presentation since the tabling of the Supplementary Budget in June, which was in response to the economy-crippling COVID-19 pandemic. It also comes on the back of the recently announced Economic Recovery Plan. Econometrix (Pty) Limited director and chief economist, Dr Azar Jammine, speaking to SAnews, said the country might see tough austerities being imposed due to the country’s recent dramatic deterioration in finances.
Export revenue increases by 115.6 USD million (Ethiopian Press Agency)
Exports in the first quarter of the fiscal year 2020 compared to in the previous fiscal year, export revenue increased by 115.6 million USD or 16 percent and a total of US $ 838.6 million was earned, according to the Ministry of Trade and Industry (MoTI). The mining sector has achieved 300 percent of the plan and 205 million USD earned. The industrial sector earned 95 percent and 94 million USD, while agricultural products earned 73 percent and 541 USD respectively, said MoTI. It is stated that the export Products contract registration and implementation of export contracts then major contribution to the improvement of export trade.
Kenya’s debt repayment down Sh199 billion on cheaper loans (Business Daily)
Taxpayers forked out Sh651.5 billion to service Kenya’s public debt in the year to June 30, a report by the Treasury shows, marking a 23.34 percent drop from the previous year. The loan repayments during the period were Sh198.57 billion lower compared to Sh850.07 billion in the 2018/19 fiscal year following a decision by the State to ditch costly commercial loans. “The decline of debt service was on account of decline to lower repayment of commercial debt,” Treasury Cabinet Secretary Ukur Yatani said in the annual public debt management report to Parliament.
Zambia’s cabinet has approved the ratification of the African Continental Free Trade Area (AfCFTA), a spokesperson said on Tuesday. Chief Government Spokesperson Dora Siliya said the cabinet approved the ratification of the agreement during its sitting on Monday, Oct. 26. She said the ratification of the agreement will enable the country to have access to a larger market and to harmonize trade instruments across the continent’s regional economic communities. Zambia signed the agreement on February 10, 2019.
On the initiative of the United Nations Economic Commission for Africa (ECA), through its Sub-Regional Office for West Africa (SRO-WA), in partnership with the Ministry of Trade and the Promotion of the Private Sector and the Organisation of Industrial Professionals in Niger (OPIN), a high-level panel was organised Thursday, October 22, 2020 on the theme “Boost local production: promote the ‘Made in Niger’ label within the framework of the implementation of the African Continental Free Trade Area (AfCFTA)”.
The Manufacturing Purchasing Managers’ Index (PMI), for the month of October, witnessed a contraction for the 6th consecutive month, as it stood at 49.4 index points. This was disclosed by the Central Bank of Nigeria (CBN), in its October PMI report released today. According to the information contained in the report, despite the fact that the Manufacturing Purchasing Managers’ Index (PMI) for the month of October contracted, the Manufacturing PMI index recorded a month-on-month increase owing to improved New orders, faster manufacturing supplier delivery time, and slight changes in production and employment levels.
Fresh concerns over $17 billion yearly freight loss to foreign shipping lines (The Guardian Nigeria)
Stakeholders in the maritime industry have expressed displeasure over the yearly $17 billion revenue loss to foreign ship owners due to the inability of the country to lift her cargoes. According to shipping experts and economists, Nigeria cannot own and manage vessels, which is a critical and essential trade facilitation tool. This is particularly worrisome as trade is the country’s second-largest contributor to its gross domestic products (GDP).
The United Nations Economic Commission for Africa (ECA) Sub-Regional Office for Southern Africa (SRO-SA) convened an Ad-hoc Expert Group Meeting on the theme: “The African Continental Free Trade Area (AfCFTA) and Trade in Services: Opportunities and Strategies for Southern Africa.” On opportunities and strategies for Southern Africa to benefit from trade in services under the AfCFTA, the e representative from UNCTAD, among others, highlighted the technical support that UNECA and UNCTAD were providing to member States in developing regional value chains in services, within a joint UN Development Account project. Ms. Trudi Hartzenberg, Executive Director of Trade Law Center (TRALAC), South Africa, emphasised the need to create an internally consistent regulatory ecosystem in services trade across the RECs and the AfCFTA.
In this brief Manchester Trade paper, we argue that unless intra-African trade under the African Continental Free Trade Agreement (AfCFTA) begins on a timely basis, Africa’s credibility as a serious player in the global economy will suffer a demoralizing blow. Specifically, if the current delays and launch dates go beyond January 2021, Africa’s various trade and investment partners may start to doubt if the AfCFTA will ever become a reality. Ideally, the current trajectory of the AfCFTA negotiations thus far should culminate in a tentative 2020 ministerial to announce the implementation of a functional AfCFTA.
Senior Minister, Dr Yaw Osafo-Maafo, has said the success of the Africa Continental Free Trade Area (AfCFTA) depends on every African country having something to trade to the rest of the continent. He said while the free trade area agreement is long overdue, African countries need to emphasise manufacturing and value addition. He said while other intra-continental trade zones like Europe and the Americas are recording annual trade volumes of 60% to 70% of total trade volumes, intra-Africa trade remains a meagre 2%, per 2016/2017 figures. “We have a long way to go to make the agreement work. We must work and trade among ourselves. Others are doing 70% and we are doing 2%. So, we need definitely to do more,” he said.
Africa needs to improve continent’s integration (China Daily)
Historically, African countries have suffered from pervasive corruption and illicit financial flows, which have continually deprived them of much-needed development funds, and eroded confidence and trust on the world stage. Furthermore, the institutions that have been established to ensure transparency and accountability are lacking the leadership and political goodwill needed to effectively discharge their mandates. However, according to the United Nations Conference on Trade and Development’s “Economic Development in Africa Report 2020”, African countries need to build greater cooperation under the African Continental Free Trade Area to curb corruption and illicit financial flows. In addition, to create more resilient African economies, Africa needs to take action on deeper integration.
Intra-regional trade among the 21 Member countries of COMESA is estimated at a 7%. This low performance is attributed to inadequate participation of all Member States in the COMESA Free Trade Area and the challenges they face in the implementing regional commitments. The situation further aggravated by poor physical connectivity leading to high transportation costs, prevalence of non-tariff barriers, lack of information exchange about existing trading opportunities and prevalence of restrictive regulatory requirements in various markets. ”We need full application of the rules-based regime provided for under the COMESA Non-Tariff Barriers regulations and collective implementation of the commitments under the World Trade Organization Trade Facilitation Agreement,” he said. “We also need to accelerate the negotiations on Trade in Services and make meaningful commitments in sectors that impact trading conditions in the region in terms of competitiveness such as financial sector, telecommunication, tourism and transportation.”
Many policymakers and businesses have been calling a green recovery and a “Build Back Better” strategy in the post-COVID-19 era to limit the impact of future pandemics and crises such as climate change. Experts stress that moving our economies towards a bio-based economy offers opportunities for countries to rebuild their economies in an environmentally and socially inclusive manner. Mama Keita, Director of UN Economic Commission (ECA) for Africa in Eastern Africa told the participant at the meeting that ”Bioeconomy is knowledge-intensive and not well-known or understood by the general public and by decision makers. The States and their partners have an important role to play to overcome these challenges.”
African banks – finding balance between post-pandemic challenges and opportunities (East African Business Week)
In a post-pandemic environment, African banks will have to navigate not only an economy in recession, but one where there will be many disruptors to existing business models and a rapid acceleration of existing trends such as digitalisation, cybercrime and the importance of environmental, social and governance (ESG) factors. Baker McKenzie’s latest report, “Finding Balance: The Post-COVID Landscape for Financial Institutions”, states that at the beginning of the COVID-19 crisis, financial institutions faced two main challenges – prudential and operational. The prudential challenge refers to a sudden drop in the value of financial assets, or loss of liquidity, whether domestically or elsewhere in the world.
The Director-General of the Food and Agriculture Organization of the United Nations QU Dongyu says Africa’s potential gives him hope that the battle against poverty and hunger can be won. He made the remarks at today’s opening of the Ministerial segment of the 31st Session of the Regional Conference for Africa. “We meet in trying times, but the opportunities ahead of us give me hope,” Director-General Qu said. “Africa is the continent of untapped potential and remains a key priority for me. I am convinced that agricultural and rural development are the keys to winning the battle against poverty and hunger in Africa.”
Experts give insight into food safety in Africa (Food Safety News)
African experts have highlighted the main food safety concerns, challenges, and potential solutions for the continent at the International Association for Food Protection (IAFP) virtual annual meeting. Lucia Anelich, director of Anelich Consulting, presented the situation in South Africa. Lucia Anelich, director of Anelich Consulting. Anelich said not all the system is risk-based but there is a push to revise regulations and standards. “Food safety management system implementation is mainly voluntary and it has become a customer requirement. So if a company wants to do business with another they will require a specific FSMS is in place and certified by an accredited certification body,” she said.
A new KPMG report says banks can only survive in the highly digitised era if their product offerings are designed in a way that meets the preference of millennials. The report titled: “Heightened customer expectation in the new normal and beyond,” said the future of customer experience will be insight-led, digitally-enabled and would require customer-centric culture as well as compelling value propositions. “Banks must deploy cross-cutting customer strategies that are born out of data analytics about customers as an essential tool for growth.
The Trade Ministers Meeting discussed ways to narrow differences and generate consensus to drive the WTO fisheries subsidies negotiations towards conclusion and the contribution of the WTO to global economic recovery post-COVID-19. The negotiations on fisheries subsidies are at a critical stage and the WTO has a role to deliver on Sustainable Development Goal (SDG) 14.6 which aims to prohibit certain forms of fisheries subsidies which contribute to overcapacity and overfishing, and eliminate subsidies that contribute to the Illegal, unreported and Unregulated (IUU) fishing, and refrain from introducing new such subsidies, recognising that appropriate and effective special and differential treatment for developing and least developed countries should be an integral part of the WTO fisheries subsidies negotiation by 2020.
Minister Patel emphasized that the key objective for the negotiations should be to discipline the subsidies that are targeted at large-scale industrial fishing, while safeguarding food security and livelihoods for subsistence and artisanal fisheries.
The informal session, convened by Australia, looked at two issues: how to narrow differences and move towards an agreement in the WTO fisheries subsidies negotiations, and how the WTO can best contribute to global economic recovery in the wake of the damage caused by the pandemic. The outlook for global trade is a bit brighter than a few months ago. Your countries’ extraordinary fiscal and monetary measures have cushioned the fall in demand, forestalled financial market instability, and contributed to an uptick in trade.
What you need to know about the EU’s backing of Okonjo-Iweala to lead the WTO (African Business Magazine)
The final round in the election for the next director-general of the World Trade Organisation, the multilateral body that regulates world trade, pits former Nigerian finance minister Ngozi Okonjo-Iweala against South Korean trade minister Yoo Myung-hee. The winner, who will be the WTO’s first female director-general, will take the reins as the global trading system comes under significant pressure from an ongoing trade war between the United States and China and amid unprecedented disruption caused by Covid-19. In a significant coup for Okonjo-Iweala, European Union ambassadors confirmed this week that the Nigerian, who would be the first African director-general of the organisation, has secured the support of the EU’s 27 member states following discussions in Brussels last week after hearings with both candidates.
WTO: 106 Countries Back Okonjo-Iweala (The Tide)
The WTO’s consultation process ended, yesterday, and the new leader is expected to be named in November but an EU official said that the EU would publicly announce its support for Nigeria’s former finance minister, Dr Ngozi Okonjo-Iweala, according to AFP. If Okonjo-Iweala is confirmed, she would join the WTO at a difficult time, with the world facing a deep post-Coronavirus recession and a crisis of confidence in free trade and globalisation.
Global trade linked to resource insecurity (Cosmos Magazine)
The global economy and international trade are aggravating water, land and energy insecurity and this is taking a disproportionate toll on supply chains and remote nations, according to the first comprehensive analysis of its kind. “Whilst most mainstream economists argue for increased trade on the basis of competitive advantage, this analysis shows empirically that trade amplifies resource insecurity,” says Oliver Taherzadeh, who led the research while at the University of Cambridge, UK. “These findings call for critical reflection on whether globalisation is compatible with managing the risks countries face.”
A new International Trade Centre (ITC) report shows governments and donors how to design and execute effective South-South programmes that have a sustainable impact on development. Drawing from case studies and interviews with ITC staff who have worked on South-South projects, Designing for Impact: South-South Trade and Investment is a guide for good project management for trade and investment promotion. It urges learning from relevant role models to transfer knowledge and technology.
Restrictions on travel introduced in response to the COVID-19 pandemic continue to hit global tourism hard, with the latest data from the World Tourism Organization (UNWTO) showing a 70% fall in international arrivals for the first eight months of 2020. All world regions recorded large declines in arrivals in the first eight months of the year. Asia and the Pacific, the first region to suffer from the impact of COVID-19, saw a 79% decrease in arrivals, followed by Africa and the Middle East (both -69%), Europe (-68%) and the Americas (-65%).
Today, U.S. government, through its Agency for International Development (USAID), and the Southern African Development Community (SADC), in close partnership with the Government of the Republic of Zambia, commissioned a pilot seed export from Zambia to Mozambique produced by emerging seed company, Lake Agriculture. “Through our Seed Trade Project, we are supporting the SADC Secretariat to harmonize the national seed legislation across all 16 Member States with the regional guidelines. Due to its location and ability to produce quality seeds, Zambia is uniquely positioned to provide the ideal seeds for this inaugural export,” said U.S. Embassy Zambia Chargé d’Affaires, a.i. David Young.
Technological advancements of the last three decades have revolutionized the nature of governance, business and daily life for the better. However, it has also given rise to a new, inconspicuous category of criminal activity. Cybercrime is the broad term for criminal activities that involve the use of digital computers. Potential victims include any individual, business or other entity with a digital device. Although there are many forms of cybercrime, the most common include hacking, committing fraud or theft, trafficking child pornography and using hate speech or inciting terrorism. Fighting cybercrime is one of the many ways governments can also help downsize poverty.
Coronavirus vaccines, World Trade Organisation and the global divide (The Financial Express)
Covid-19 has introduced several far-reaching changes in the global order. Some of these are in management of global trade. The division among countries over flexibilities to be allowed in the World Trade Organisation’s intellectual property rules, for global production and distribution of vaccines, is an indication of the turmoil that global trade management and the WTO would encounter in the days to come. Concerns over low-income populations in several countries missing out on vaccines have been highlighted by findings of a recent study by Oxfam.