Building capacity to help Africa trade better

tralac Daily News


tralac Daily News

tralac Daily News
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Country focus

20 land borders will reopen on Monday, says Motsoaledi (Times LIVE)

Twenty land borders will reopen on Monday, the cabinet decided on Saturday. The border crossings between SA and Botswana, Lesotho, Eswatini, Namibia, Mozambique and Zimbabwe were closed on January 11 in an attempt to control the spread of Covid-19. A statement from the home affairs department said minister Aaron Motsoaledi, deputy minister Njabulo Nzuza and director-general Tommy Makhode will visit the four busiest border posts for the reopening on Monday.

Doctors Fear Covid Variant Outbreak If Zim Opens Border With SA (New Zimbabwe)

Zimbabwe Doctors for Human Rights (ZDHR) have advised the government not to open land borders with SA when it reviews the current lockdown. The end of the extended lockdown coincides with SA’s resolution to open its borders on February 15. Home affairs minister Kazembe Kazembe said a decision to open the country’s ports of entry would be made after consultations with the national Covid-19 task force. Currently only airports are open for civilian travel. Meanwhile, as part of measures to reduce the spread of the virus, the Zimbabwe Human Rights NGO Forum delivered a petition to President Emmerson Mnangagwa to consider presidential pardons as a tool to decongest prisons.

Manufacturing and mining data show sputtering signs of life (Daily Maverick)

December manufacturing and mining data released on Thursday by Statistics South Africa showed signs of a sputtering return to life for both sectors at the end of 2020, but the picture is still pretty dismal. Mining production inched up by 0.1% in December of 2020 compared with the same month the previous year, and 0.5% compared on a monthly basis. By contrast, mineral sales rose by almost 24% year on year in December. Manufacturing also perked up a bit in December, rising 1.8% in the month compared to December of 2019, but the outlook for the sector remains dire. “Furthermore, uncertainty surrounding the government’s vaccine roll-out programme could lead to a sustained period of muted domestic demand,” NKC African Economics said in a commentary note. Both sectors are labour intensive, are crucial for exports, and remain key to unlocking future investment. Their slide needs to be arrested and fast.

Biden Faces South African Push to Extend Trade Concessions (Bloomberg)

South Africa is apprehensive about striking a new trade deal with the U.S. and would rather maintain existing relations with the world’s largest economy, the nation’s top trade official said. South Africa is currently party to the so-called Generalized System of Preferences and the African Growth and Opportunity Act, or AGOA, which together allow most sub-Saharan African countries duty-free access to the American market for almost 7,000 products. AGOA is due to expire in 2025, while Richard Neal, the chairman of the House of Representatives’ Ways & Means Committee, has called for the GSP – the U.S.’s oldest and largest trade-preference program for the world’s poorest economies – to be updated.

COVID-19: From relief to recovery (SAnews)

President Cyril Ramaphosa says South Africa’s collective efforts in the wake of the COVID-19 pandemic must now shift from relief measures to deliberate action to aid economic recovery. This, the President said in his weekly newsletter on Monday, will require cooperation and contribution from every citizen. President Ramaphosa said the country was able to provide a lifeline to its citizens due to the already-existing social security safety net in the form of the South African Social Security Agency (Sassa) and the Unemployment Insurance Fund (UIF). The two bodies were respectively able to provide relief to vulnerable citizens and those whose livelihoods were compromised by the pandemic and resultant lockdown.

South Africa: Taxing the rich has a wealth of potential benefits (New Frame)

Raising the taxes paid by South Africa’s estimated 350 000 wealthiest individuals could deliver much-needed additional revenue to the state’s emptying coffers. The Covid-19 pandemic has shown starkly how unequal the world is, and nowhere is that more evident than in the most unequal country in the world. In South Africa, just 1% of the population owns 55% of the wealth. Going beyond the 1%, South Africa had four US dollar billionaires in 2020 who owned 18% of all the wealth in the country, according to Forbes magazine.

SGR cargo services surpass targets, records best performance in January (KBC)

Kenya Railways Corporation (KRC) has continued to build concerted efforts in enhancing cargo evacuations from the Port of Mombasa. The month of January recorded the best performance since the SGR Madaraka freight inception, with 241 trains run from Mombasa and delivering 24,256 TEUs to both Nairobi and Naivasha ICDs. According to KRC Managing Director Mr Philip Mainga, this remarkable performance was achieved due to the revival of majority of wagons earlier under maintenance repairs and internal conversion of additional conventional cargo wagons to load containerized cargo.

Flower farmers cry foul ahead of Valentine (KBC)

The Kenya Flower Council (KFC) has decried high taxes, lack of flights and poor weather patterns in Europe as the main challenges currently facing flower farmers ahead of Valentine’s day this Sunday. While projecting that the sector which was hardest hit by Covid-19 would recover by the end of the year, the council pointed an accusing finger at the State for unfair tax regimes. This came as the council noted that they were currently exporting only 75 per cent of their produce due to lack of enough flights and limited space.

Kenya: Farmers, households take heat from oil price surge (Business Daily)

Farmers, poor households and transporters are set to continue feeling the heat of rebounding global oil prices, with the cost of diesel and kerosene increasing considerably for the second successive month. The Energy and Petroleum Regulatory Authority (Epra) Sunday increased the retail price of diesel and kerosene by Sh5.51 and Sh5.32 per litre, respectively – citing higher import prices. Kenya’s economy also largely relies on diesel for transportation and power generation, with the price increase expected to impact on the cost of living for households.

Mps want Kenya called to order for refusing Uganda’s dairy products (KFM)

Members of parliament have expressed disappointment over continued blocking of Ugandan products by regional organizations. This was during last evening’s plenary session as the minister of trade Amelia Kyambadde issued a statement “Continued Prohibition of Ugandan Dairy Products to Access the Kenyan Market. Members of parliament including John Baptist Nambeshe, Gilbert Oulanya and Jackline Amongin said it was frustrating for Ugandans to be the ones losing out yet traders from other EAC member countries are freely trading in Uganda.

Rwandan govt emphasises Covid-19 negative results for cross-border travellers (The New Times)

The Ministry of Infrastructure on Thursday, February 11, issued a public notice putting yet more emphasis on the need for all people intending to travel using the country’s land borders to first test and show a negative Covid-19 test in a bid to prevent the spread of the virus. The notice is in line with Government’s measures to prevent the spread of Coronavirus and having observed that some cross border truck drivers and other truck crew members start their journeys before undergoing requisite testing thus the risk of spreading Covid-19 along the way to the borders. Others take the tests but set off before they can get the results.

Rwanda begins vaccinating vulnerable against Covid-19 (The East African)

Rwanda has started its first phase of vaccination against Covid-19 with the limited 1,000 doses of the Moderna vaccine administered to high-risk groups, including frontline workers. The first and primary beneficiaries of the Covid-19 jab will get it for free. The Ministry of Health says the limited initial doses were ”acquired through international partnership in limited quantities” though the country anticipates receiving additional doses in the coming weeks to allow it to expand the vaccination exercise.

BUA’s 200,000bpd Refinery Project Will Meet FG’s Economic Diversification Agenda-Rabiu (Leadership)

Founder and executive chairman, BUA Group, Abdul Samad Rabiu has said the proposed 200,000 barrels per day BUA refining and petrochemical plant in Akwa Ibom will meet the federal government’s economic diversification agenda in the long run. Rabiu disclosed this at a forum in Lagos recently. According to him, as new fuel standards continue to evolve in line with the climate crisis, a project like BUA refinery will have a monumental positive impact on the nation’s economy.

Rwanda lifts duty on luxury cars in move to woo tourists (The East African)

Rwanda will forgo millions of dollars in tax exemptions from importers of expensive vehicles as it attracts high-end tourists into the country. It is the latest attempt to boost tourism, which is struggling to recover from the second wave of Covid-19 infections that have led to new travel restrictions by some countries. In a letter dated January 22, 2021, the Ministry of Finance instructed the Rwanda Revenue Authority to exempt excise duty, value added tax and withholding tax on imported vehicles valued at $60,000 and above. The rationale behind the exemptions, as explained in the letter, aims at facilitating the importation of expensive cars to promote high-end tourism, meetings incentives conferences and exhibitions (MICE), and foreign investment.

Customs chief canvasses mechanisms for AfCFTA success (The Sun Nigeria)

The Nigeria Customs Service (NCS) is canvassing for mechanisms to check the inflow of products of non-participating countries into Africa through the African Continental Free Trade Area (AfCFTA) agreement. The Comptroller-General of Customs, Col Hameed Ali (retd) said that implementation of AfCFTA must abide by the rules of origin policy, to forestall the challenges that might arise in its operations. He, however, disclosed that customs had yet to receive the instruments that would enable it to facilitate the AfCFTA goods movements.

Expert Seeks Improved Ease of Doing Business (THISDAYLIVE)

As part of efforts to strengthen ease of doing business in the country, an expert, Olugbenga Ojo, has inaugurated a platform – Eximtradeoptions – to boost trade in Africa and across the world. Announcing the platform during a virtual event held recently, Ojo, who was an alumnus of the Harvard Law School said unveiling of the new platform was necessary to provide an enabling environment for Nigerian business community, who are keen about exploring foreign markets. “The trade platform which is structured to manage the end to end of the supply chain for both importers and exporters from any part of the world with a protection of the legal framework and insurance against losses, provides array opportunities, with four payment and service packages to accommodate every business interest in the area of international trading,” he stated.

Former NACCIMA boss urges FG to develop export products (WorldStage)

Dr John Isemede, an international export professional, has urged the Federal Government to identify and present made-in-Nigeria products with export potential to maximise the benefits of the Africa Continental Free Trade Area (AfCFTA). He called for a National Trade Fair dedicated to only Made-in-Nigeria products and services through which the Federal Government could identify products, develop and market them through the AfCFTA platform. The former D-G said the country should take advantage of its number one position in the production of cashew nuts, cassava, yam, beans among others in the AfCFTA.

Rice, flour, sugar, cement top free trade exemption list (The Guardian Nigeria)

Despite Nigeria’s comparative advantage and self-sufficiency status in the production of certain products, cement, flour, rice, sugar and 180 other products would not be liberalised under the African Continental Free Trade Area (AfCFTA), even though doing otherwise would help the country tame its rising inflation, The Guardian learnt. Sources familiar with the tariff lines in the schedule submitted to ECOWAS by Nigeria for negotiation told The Guardian that, while 131 products are already on the import prohibition list, the remaining products on the exclusive list were picked based on national priorities, trade volume, priority, food security and competitive advantage.

Nigeria’s cryptocurrency crackdown causes confusion (DW)

Cryptocurrencies eliminate the need for banks and other financial intermediaries in managing exchanges of currency and assets. Despite the technology being decentralized – with no government, company or person controlling it – the Central Bank of Nigeria (CBN) is cracking down on the trade of cryptocurrencies. Last Friday, the CBN instructed commercial banks and other financial institutions to close accounts involved in transactions with cryptocurrency exchanges. Before the ban was introduced, Enogieru Osasenaga invested 100,000 naira (€216, $263) in Bitcoin, the world’s first decentralized digital currency. A week later, its value had doubled.

News from Africa and Africa’s international trade relations

Wamkele Mene: ‘AfCFTA is going to be difficult but we’ve got to do it’ (The Africa Report)

Africa’s over-reliance on exporting primary commodities is detrimental to its economic development and undermines its ambition for greater integration. As Mene puts it, this “keeps Africa trapped in [a] colonial model of economic trajectory”. But, in dealing with trade and economy ministers from all over the continent, he says he sees a lot of goodwill. “Everybody wants [to see] Africa industrialising. Everybody wants to see a digital economy on the continent. Everybody wants to see the continent leapfrogging into the Fourth Industrial Revolution,” Mene says.

E-commerce in preferential trade agreements: implications for African firms and the AfCFTA (ODI)

At continent level, the African Continental Free Trade Area (AfCFTA) negotiations are scheduled to include a protocol on e-commerce under Phase III, presenting a unique opportunity for African countries to collectively establish common positions on e-commerce, harmonise digital economy regulations and leverage the benefits of e-commerce. In this paper, we examine developments in e-commerce negotiations, their implications for African businesses and the role of the AfCFTA.

EABC calls for improvement of infrastructure at border posts to fast track cargo movement (East African Business Council)

The East African Business Council (EABC) is calling upon East Africa Partner States to prioritize the improvement of infrastructure at Border Posts, to facilitate seamless flow of goods and movement of persons, as cross border business rebounds. Poor infrastructure continues to be a huge trade barrier in East Africa and a major constraint to regional integration and development. EABC also urged revenue authorities to install cargo scanners at border points to facilitate trade.

Feeding Africa’s fast-growing cities (Farmer’s Weekly)

Demographic projections have forecast that in the coming decades, Africa’s rate of urbanisation will be the highest in the world. As a result, Africa’s cities and food markets offer the largest and fastest-growing market opportunity available to the continent’s 60 million farms. In their efforts to supply growing urban food markets, Africa’s farmers, agro-industries and policymakers face many challenges. In the face of mounting food imports from overseas, African farmers, traders and wholesalers have to find ways to drive down the domestic costs of production, storage and distribution in order to remain competitive with external suppliers in Brazil, North America, Europe and Asia.

Africa in the news: African debt, rising food prices, and vaccine updates

On Thursday, February 11, the United Nations Economic Commission for Africa (UNECA) predicted that the economic damage inflicted by COVID-19 would influence more African nations to pursue debt relief through a new G-20 common framework that leverages the IMF to negotiate debt reduction from private and public creditors, thereby assisting countries in alleviating the economic and financial pressures of the pandemic.

Together with heavy reliance on fossil fuels for government revenue, diminished global oil demand and prices, and unsustainable debt burdens pre-COVID, UNECA emphasized that the strain on government revenues in Africa makes some countries, such as Angola and the Republic of the Congo, particularly vulnerable to pandemic-imposed economic distress.

Notably, not all experts agree on the extent of restructuring’s adverse impact on financing sovereign debt: Vera Songwe, executive director of UNECA and a nonresident senior fellow with Brookings Africa Growth Initiative, does not see the rise in African eurobond interest rates in response to participation in G-20 debt relief as a hindrance to their market access to sovereign debt issuance.

Next Africa: AstraZeneca’s Vaccine Findings Set Back a Continent (Bloomberg)

This week AstraZeneca said its Covid-19 vaccine provides little protection against mild forms of the disease caused by a variant of the virus first identified in South Africa. While China and Russia are pledging donations of their own vaccines to African countries, there is as yet no data on their performance against the variant.

The climate and trade nexus in Africa (ODI)

This report analyses the impacts that changes in trade structures, economic growth and technology have had on the greenhouse gas emissions (GhG) generated in the continent. It sets out climate change adaptation and mitigation strategies in the context of Africa’s economic transformation and development. In this sense, it aims to identify the intersection between trade and climate policies and critical outcomes: the low-carbon and resilient economic development of the continent.

Don’t forget local authorities in EU-Africa relations (EURACTIV)

As the EU and African Union seek to make up for the time lost in 2020 by accelerating talks on a new ‘strategic partnership’ covering political and economic cooperation, one of the risks is that the high-level political talks take place in a vacuum, with little regard for local communities. African civil society activists already complain that they have been left out of the consultation process thus far. Cooperation between the European Commission and local authorities across Africa is set to increase under the EU’s new seven-year budget framework which, for the first time, will see local authorities participate in the process as public actors alongside the central state to define the priorities of European cooperation projects and programs.

China-Africa economic, trade cooperation forges ahead (The Citizen)

As Africa’s major trading partner, China is among countries whose trade with Africa experienced the lowest decrease in absolute terms. In this sense, China has adopted positive measures and taken the initiative to expand its imports from Africa. China attaches great importance to the challenges caused by Covid-19 to African countries and is actively implementing the G20 Debt Service Suspension Initiative (DSSI). At present, China ranks first among G20 member countries who have carried out DSSI by suspending $1353 million worth of debt service payments from 23 countries, including $817 million from 15 African countries.

Global economy

Revised Kyoto Convention (RKC) now has 126 Contracting Parties following the accession of Liberia and Turkmenistan (WCO)

On 10 February 2021, the WCO Secretary General Dr. Kunio Mikuriya met with H.E Dr. Isaac W. Nyenabo II, the Ambassador of the Republic of Liberia in Brussels at the Headquarters of the WCO, following the deposit on 14 December 2020 of the country’s act of ratification of the International Convention on the Simplification and Harmonization of Customs Procedures (Revised Kyoto Convention – RKC). During his meeting with Ambassador Dr. Isaac W. Nyenabo II, Secretary General Mikuriya highlighted that, in support of Liberia and the African Continental Free Trade Agreement (AfCFTA), the RKC is a powerful instrument and if correctly implemented can contribute to boost trade, improve revenue collection, safety, and security controls.

‘Vaccine apartheid’ among trade hurdles awaiting WTO new boss (The East African)

The World Trade Organisation (WTO) will meet in the coming days to conclude the appointment of its new director-general, signalling an end to the push-and-pull between the US and other member states. But the imminent designation of Nigeria’s Ngozi Okonjo-Iweala, after the US finally backed her, could mean her first challenge is something she has faced before, vaccine politics.

All countries have accepted that Covid-19 is an emergency, but wealthy countries have cracked under Big Pharma pressure to impose further non-tariff barriers making it difficult for the poor to import. A vaccine importation strategy publicised by Kenya on Thursday revised the dates to 2023, when at least 16 million people may have been vaccinated. An initial target was to meet this by the end of this year.

WTO Gets First Woman And First African Director General – Analysis (Eurasia Review)

The appointment of a new WTO DG became necessary after the former Chief, Mr Roberto Azevêdo resigned a year before the end of his term, officially stepping down on the 31 August, 2020. He had said that he wanted to give WTO members enough time to choose his successor. However, this rendered the organisation leaderless during a difficult time. The liberal international economic order was – and still is – facing a backlash, while the trade and technology war between the US and China has had a negative effect on global trade.

A new WTO boss who understands Africa is a good thing for the global economy (City A.M.)

The impasse over who will become the next director-general of the WTO has at last come to a conclusion. Following South Korean Trade Minister Yoo Myung-hee’s withdrawal from the selection process, the path is now clear for Ngozi Okonjo-Iweala, a widely respected former Nigerian finance minister, to become the first woman and first African to lead the WTO. The Biden administration’s backing of her candidacy – after months of stonewalling by the Trump White House – means her appointment is a formality. At a time when the global trade system is in desperate need for a cooperative and inclusive response to the Covid-19 pandemic and simmering US-China relations, all member states should welcome fresh leadership at the WTO.

New WTO chief faces rough road ahead (POLITICO)

The coronavirus pandemic also unleashed calls around the world for less reliance on global supply chains as well as impulses to hunker down and produce more goods at home. President Joe Biden, while turning a friendlier face to the world than Trump, is putting domestic recovery at the core of his administration with his “Build Back Better” agenda. Okonjo-Iweala, who holds dual U.S. citizenship, will have to quickly demonstrate her ability to bring countries together after four years of growing mistrust generated largely by Trump’s highly disruptive “America First” trade policy. There will be tremendous pressure on her to produce significant results by the end of the year, when the WTO is expected to hold its first ministerial conference under her watch.

Development finance trends to watch in 2021 (Devex)

Shifting financial markets, evolving public policy priorities, and the pandemic are all impacting the mix of products and strategies garnering more attention in development finance this year. Some areas seem to be slow-moving trends, including blended finance. But others, such as social bonds, seem to be experiencing a rapid acceleration. As private finance and capital markets exert their influence on development finance, there continues to be a push for better standardization and harmonization of metrics, in large part to avoid dilution of impact. As some of these instruments gain popularity, they’re raising questions about whether they will direct private capital to countries and issues that need it most, and importantly, what they may divert increasingly limited official development funds from.

Rising Up to the Challenge: COVID-19 Guidelines Amidst Border Closures and a Pandemic (ReliefWeb)

Since the outbreak of the novel coronavirus (COVID-19) pandemic, over 100 million cases have been confirmed the world over, with Africa recording 3.5 million of the confirmed cases. To curtail the spread of the virus, governments have resorted to lockdowns and border closures. The World Trade Organization projects a drop in African exports and imports by 8 and 16 per cent, respectively, each with its own unique implications for African economies. With the global recession and the disruption of travel, Africa’s high reliance on primary commodity exports (77 per cent of total exports) poses serious risks to trade. Meanwhile, Africa is still heavily reliant on imports for essential goods like food items, energy and fuel products, and pharmaceutical products, which are key to mitigating the COVID-19 pandemic. These essential goods make up 32 per cent of the continent’s total imports, compared with a global average of 23 per cent, revealing a unique vulnerability to trade flows and further emphasizing the need to facilitate cross-border trade on the continent.

Biden to speak at virtual meeting of world’s major economies (Associated Press)

President Joe Biden will speak at a virtual meeting of the world’s major economies on Friday to discuss the coronavirus pandemic and global vaccination distribution, according to the White House. Biden is expected to speak about the need for a global response to the pandemic and to recommit the U.S. to multilateral engagement, a stark contrast from President Donald Trump, who developed an isolationist foreign policy that saw the U.S. withdraw from major global agreements and alliances. Since entering office, Biden has reversed many of Trump’s isolationist moves, including by rejoining the World Health Organization.

Technology, growth, and inequality: Changing dynamics in the digital era (Brookings)

Ours is a time of exciting technological change. The era of smart machines holds the promise of a more prosperous future for all. But it demands smarter policies to realize that promise. To capture potential gains in productivity and economic growth and to address rising inequality, policies will need to be more responsive to change as technology reshapes markets. And change will only intensify as artificial intelligence and other new advances drive digital transformation further – and at an accelerated pace in the aftermath of the COVID-19 pandemic.


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