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South Africa’s Infrastructure Fund, which is spearheading government efforts to secure R1-trillion of private investment, said it has identified a project pipeline and implementation could begin by year-end. Established in August, the fund is targeting investing R100-billion in infrastructure over the next decade — spending it anticipates will galvanise 10 times as much money from pension funds, banks and other institutions. National treasury allocated the fund R18-billion over the next three fiscal years in the February budget, with a first portion set to be tapped in May, according to Mohale Rakgate, the fund’s chief investment officer. “Government is really putting its money where its mouth is,” Rakgate said in an interview on Wednesday. “There is a sense that it can’t be business as usual.”
Data from Statistics South Africa on Wednesday (24 March), showed that South Africa’s headline consumer price inflation slowed to 2.9% year-on-year in February from 3.2% in January. Month-on-month (m/m) inflation rose by 0.7% in February compared to 0.3% in January, the data showed. The main drivers behind February’s monthly increase were the fuel and medical insurance categories, while meat, housing, water and electricity, new vehicles and medical insurance contributed most to the y/y increase.
Rwandan experts have said that Rwanda needs financial support such as grants and soft loans to support its economic transformation, a priority in the government’s 7-year National Strategy for Transformation, in the aftermath of the COVID-19 pandemic. Rwandan economy like other economies in the world have been greatly affected by the COVID-19 pandemic as several economic activities came to standstill, most especially during lockdowns imposed to contain further spread of the virus, and sectors like tourism, transport, manufacturing, services and retail trade in the central African nation were disrupted by the pandemic, Rwandan economist Teddy Kaberuka told Xinhua. Growth of trade in goods and services declined due to restrictions in cross-border movements, with travel restrictions, suspension of air travel and hotels operation, said Kaberuka, adding that travel and tourism became one of the most affected sectors since the onset of the outbreak of the pandemic.
CURRENT account deficit increased to 128.7 million US dollars in the year ending January from a deficit of 68.2 million US dollars in the corresponding period in 2020, largely attributed to rise in imports of goods, coupled with decrease in services receipt. The Bank of Tanzania (BoT) monthly economic review for February shows that the exports of goods and services amounted to 181.0 million US dollars in the year ending January compared with 229.4 million US dollars in the year ending January last year on account of dismal performance of services receipt in particular tourism.
On month-to-month basis, goods exports contracted to 0.5 million US dollars in January this year from 12.4 million US dollars in the previous month and 10.1 million US dollars in January last year largely due to decline in manufactured goods and other exports. The value of imports of goods and services amounted to 432.3 million US dollars in the year ending January this year from 374.8 million US dollars in the corresponding period last year.
THE implementation of the Lesotho Standards Institution (LSI) is set to be further delayed as the Ministry of Trade and Industry has not been allocated any funds for its operationalisation in the proposed 2021/22 financial year budget. Following the LSI’s launch by the Trade ministry last August, it was expected that the LSI would be allocated funds in the 2021/22 budget so that it would begin its work. The LSI was set up to develop and publish the national standards, testing and certification of various local products as well as to conduct trainings on standards related matters. The lack of a functional standards body is one of the biggest technical barriers deterring local producers from entering into export markets as well as the local formal markets.
Revitalizing the competitiveness of Lesotho’s export manufacturing sector (World Bank Blogs)
The transformative power of the export manufacturing sector in Lesotho has been apparent over last two decades. The textile and apparel industry grew from having just a handful of factories in the 1990s to becoming the largest private-sector employer, providing over 50,000 jobs (mostly to women), and directly and indirectly benefitting 13% of Lesotho’s population. Between 2001 and 2004, textile and apparel exports from the Lesotho to the US increased from $140 million to $450 million – a 220% increase.
The foreign investment that poured into Lesotho during this time facilitated structural transformation and boosted the long-term competitiveness of the sector, and despite losing some of its competitive edge in the early 2000s, Lesotho had developed the infrastructure and capabilities to tap into new markets. The manufacturing sector grew by 34% between 2014 and 2019, owing largely to a tripling of textile and apparel exports to South Africa, which has helped offset the decline in exports to the US. The textile and apparel sector is also a key employer of women, accounting for 80% of textile workers in Lesotho.
However, the COVID-19 (coronavirus) pandemic has adversely affected nearly every part of the economy, including textile and apparel sector. Lesotho is facing a tough fiscal outlook as the Southern African Customs Union (SACU) transfers, private investments and exports are declining.
Uganda’s coffee on upward trend (The East African)
Uganda’s coffee exports have defied coronavirus market disruptions for a straight second month recording growth in value and volume. The Uganda Coffee Development Authority last week released data that shows that the country’s coffee exports between March 2020 and February 2021 totalled 5.56 million bags worth $511.21 million, from 4.74 million bags worth $459.47 million the previous year, representing 17 per cent and 11 per cent increase in quantity and value respectively. In February, Uganda exported 563,763 60-kg bags of coffee worth $50.55 million. According to Minister of Agriculture Vincent Ssempijja, the recent growth in exports is attributed to increased production in the country’s coffee growing regions, and the streamlining of transport and logistics from the farms to the market despite travel restrictions.
Kenya exports to Africa markets hit 8-year high (Business Daily)
Kenya’s exports to key markets in Africa rose to an eight-year high in 2020, provisional international trade data show, defying delays at border points caused by efforts to stem the spread of the global coronavirus pandemic. Data collated by the Central Bank of Kenya (CBK) indicate value of goods that were sold to other countries on the continent amounted to Sh243.68 billion, a 9.07 percent growth over the previous year. The growth in value of trade between Kenya and Africa to the highest level since 2012 (Sh247.60 billion) was largely driven by demand in smaller exports destinations on the continent. Nairobi is championing a plan to remove trade barriers among African countries to grow movement of goods, services and labour through the African Continental Free Trade Area (AfCFTA) which aims to create a market of at least 1.2 billion.
Manufacturers urge Government to harmonize laws to drive competitiveness (Capital FM Kenya)
Manufacturers have urged Government to harmonize laws, policies and regulations, at the National and County levels, to drive the competitiveness of local industry. This was during the launch of the Regulatory Audit Report, 2020 that highlights regulatory challenges facing the business community across the country. Speaking during the launch, KAM Chair, Mucai Kunyiha explained that whilst regulations seek to create a level-playing field for businesses, regulatory overreach hinders the competitiveness of local industry. “At the national level, manufacturers are required to adhere to duplicating requirements, from different regulatory bodies, in addition to meeting numerous tax obligations. In the counties, we have to pay various fees, levies and charges. This drives up the cost of doing business in the country, thus reducing our competitiveness locally, regionally and even globally,” highlighted Kunyiha.
Kenya risks UK blacklist over open Tanzania border (Business Daily)
Kenya risks joining the UK’s ‘red list’ of countries from where travellers are subjected to mandatory stay at quarantine hotels due to the government’s reluctance to close the border with Tanzania. Britain’s Telegraph newspaper, quoting a source from the British High Commission in Nairobi, said that Kenya is likely to be added to the ‘red list’ by March 29. Kenya has been hesitant to restrict movement on the Tanzania border, fearing retaliation by Dar es Salam.
Potential exporters seeking to do business under the African Continental Free Trade Area (AfCFTA), are being encouraged to register since registration is free. According to the Customs Division of the Ghana Revenue Authority (GRA-CD) exporters under (AfCFTA) are not required to pay any registration fees before being admitted. It said prospective exporters are supposed to download the registration form on the Integrated Customs Management System (ICUMS) online portal and provide the necessary information for registration.
AfCFTA Agreement: Riding Through Phases (Proshare Nigeria)
At the start of the sensitization programme to address both the private and public sector about the implications of the African Continental Free Trade Agreement (AfCFTA), the National Action Committee on AfCFTA has indicated plans to grow its intra-Africa export trade volume to US$50bn by 2035. According to a Punch news report, the Senior Special Assistant to the President and Secretary of the committee, Mr. Francis Anatogu, noted that the other objectives of the country are to establish a highly productive workforce, business-friendly environment, quality infrastructure, export development incentives and a strong national brand. Admittedly, he also identified the country’s existing challenges as downside risks to achieving its targets.
As part of its commitment to a successful implementation of the African Continental Free Trade (AfCFTA) Agreement, Nigerian Government said, efforts are ongoing to establish a trade remedies authority to enforce Rules of origin and tighten borders against fraudulent invoicing. The Minister of Industry, Trade and Investment, Otunba Adeniyi Adebayo, made the disclosure at Lagos State Government House while paying a call on Governor Babajide Sanwo-Olu as part of the Nationwide Sensitisation visit to Lagos by the National Action Committee on the AfCFTA. The Minister added that the Federal Government was committed to establishing Nigeria’s designated competent authority for administering the AfCFTA rules of origin as well as automating the process for managing exporter and product registration. Adebayo, said the National Action Committee on the AfCFTA, which he Chairs, is collaborating with the National Trade Facilitation Committee domiciled in the Federal Ministry of Industry, Trade and Investment to facilitate the execution of the regional trade facilitation roadmap.
The Network of Financial and Tax Reporters (NFTR) Gambia Chapter on Wednesday convened a day’s sensitisation for its members on ECOWAS protocols and its related treaties in respect to Inter-state Road Transit Barriers in the sub-region. Welcoming the participants, Abdoulie Nyockeh, president of NFTR -Gambia Chapter, said the forum would accord members the opportunity to have in-depth knowledge on what the ECOWAS protocol entails in order to effectively report on issues affecting cross-border trade.
News from Africa and Africa’s international trade relations
ATO: New project in Seychelles aims to facilitate trade with African countries (Seychelles News Agency)
Seychelles will soon start the implementation of the African Trade Observatory (ATO) project where local businesses can get more information about trade potential within the African continent, a top government official said on Tuesday. The principal secretary for Trade, Cillia Mangroo, told a press conference that the government will need to sign a memorandum of understanding (MOU) with the International Trade Centre (ITC) to be able to benefit from the project. Mangroo added that the cabinet of ministers endorsed the signing of the MOU last week. “This will assist government and the private sector to get more information on the different trade opportunities and to collect trade data from a different country. It is a pilot project but Seychelles wanted to come as one of the first countries so that we could benefit because it would also assist the private sector,” said Mangroo. Mangroo added that the Trade Department will be meeting with the private sector to know which country they would like to get more information on. “So, with this tool, it will provide them with more information on what they can buy or sell in different countries on the African continent and it will help us also to know what they would want from the market.”
SMEs to contribute US$2 trillion to GDP (The Herald)
SMALL to Medium Enterprises in Africa have the potential to contribute over US$2 trillion combined to the Gross Domestic Product under the African Continental Free Trade Area (AfCFTA), a standards and systems certification body for Southern Africa said yesterday. “If you look at the US$3,4 trillion and given the fact that in Africa, 70 percent and if not more of businesses fall under the SMEs sector, we are looking at over US$2 trillion GDP contribution coming from the SMEs,” he said. Mr Zuze said under the AfCFTA the SMEs sector has the potential to contribute the bulk of employment and skills development on the continent.
African countries are yet to see the light at the end of the tunnel of the COVID-19 crisis, but they must quickly initiate deep economic reforms to prepare for their future as returning to their pre-pandemic model is no longer impossible. While the pandemic has generated an urgent need for increased international support for Africa within the framework of a more modern form of multilateralism, the region will have to take charge of its own future by building a new kind of partnership with the private sector - both at the national and international level - so as to secure the financing needed for their economic recovery and mitigate the medium and long-term impact of the crisis. These were the main takeaways of the high-level roundtable “The Big Debate: Was the multilateral system prepared for the COVID-19 crisis and did the private sector do enough?” held during the ministerial segment of the Fifty-third session of the Conference of African Ministers of Finance, Planning and Economic Development on Monday March 22nd, 2021.
African Ministers of Finance, Planning and Economic Development have called on the Economic Commission for Africa (ECA) and development partners to support efforts for a rebound of Africa’s economic growth post-COVID-19 pandemic. In a statement adopted at the end of the 53rd Session of the Economic Commission for Africa’s Conference of African Ministers of Finance, Planning and Economic Development, the Ministers commended the ECA and its partners for the platform to discuss several debt initiatives, such as the Group of 20 Debt Service Suspension Initiative (DSSI) and sovereign debt restructuring, to enhance member States’ access to finance to effectively respond to the pandemic. The ECA has been advocating for the extension of the DSSI to the end of 2021 to ensure countries have enough liquidity to respond and kick-start recovery by freeing up resources to pay for much-need vaccines and improve their buffers.
“Five of the six countries in debt distress are African least developed countries and two of the least developed countries have decided to seek debt restructuring under the common framework for debt treatments beyond the Debt Service Suspension Initiative of the Group of 20.”
Building Better Bridges: AfCFTA & New Africa (NewsReleaseWire.com)
As Africa’s continent-wide free trade area becomes open for business, The Made Man Foundation (TMM) is hosting a series of international gatherings to discuss ways to maximize new and unprecedented opportunities. The series of events are part of TMM’s “100 Days of Action” campaign focused on building a global coalition among African nations and the worldwide diaspora.
“The coming years are going to offer great potential for Africa,” says Dr. Ky Dele, international relations strategist, lead organizer and Founder of Made Man Foundation. “However, maximizing this potential requires engagement by the world community and we must start building those bridges now.” To that end, TMM is hosting “Building Better Bridges: AfCFTA and the New Africa” where representatives of African and Caribbean nations, U.S. political institutions, industry, and populations of African descent will discuss ways to increase cooperation.
The African Union (AU) has welcomed the Democratic Republic of Congo as the newest member of its African Peer Review Mechanism. This took place during the AU’s 30th Forum of Heads of State and Government on Thursday. The meeting included presentations on ongoing or imminent reviews of governance and other spheres in a number of countries, including Liberia, Sierra Leone, Zambia and Kenya. The African Peer Review Mechanism is a voluntary mechanism that enables AU members to provide and submit to evaluation at local, national and continental levels. In his opening remarks, South African President and African Peer Review Mechanism Chairperson Cyril Ramaphosa thanked the assembled heads of state for their political leadership. “I am certain that the mechanism will be a vital instrument for the achievement of Africa’s social and economic goals as enshrined in the AU’s Agenda 2063 and the UN’s Agenda 2030,” he said.
“Through our African Peer Review Mechanism institutional support project, the African Development Bank will continue to very strongly back efforts to enhance the efficiency, effectiveness and relevance of the African Peer Review Mechanism,” Adesina said.
African airlines are testing their own Covid-19 passport (Business Insider)
Kenya Airways and Ethiopian Airlines are testing a new digital Covid-19 passport system. The digital health passport allows travellers and airport authorities to authenticate Covid-19 test certificates prior to departure. The Trusted Travel Pass pilot programme was developed by the Africa Centre for Disease Control and Prevention (CDC), as digital health passports look likely to become a standard requirement for international travel. A global travel pass developed by the International Air Transport Association (IATA) is currently being trialled by several leading international airlines. The pass allows travellers to create a digital copy of their passports and receive verified information on country-specific travel requirements via an app. These requirements will inform what testing or vaccination procedures need to be followed prior to departure.
Africa’s extractive industry can support the continent’s resilience and sustainable growth during and beyond the ongoing Covid-19 pandemic. This will, however, require appropriate social and economic development linkages that meet national and regional development objectives. Policy frameworks, such as the Africa Mining Vision (AMV), while not without its challenges, could play a key role in facilitating this. This was highlighted by several speakers during a recent virtual seminar titled Minerals and Africa’s Development: Challenges and Opportunities that was hosted by multilateral development finance institution the African Development Bank (AfDB). The AfDB’s African Natural Resources Centre and African Legal Support Facility were joined by the Nordic Africa Institute in hosting the seminar. The AMV is an Africa Union (AU) policy framework whose vision is the transparent, equitable and optimal exploitation of mineral resources to underpin broad-based sustainable growth and socioeconomic development.
On Thursday, MEPs adopted a wide-ranging strategy for a new EU-Africa partnership by 460 votes in favour, with 64 votes against and 163 abstentions. The strategy emphasises that human development must be at the centre of future EU-Africa relations, prioritising education, including teacher training, reducing early school leaving, and concentrate on the inclusion of girls. A future EU-Africa strategy should also aim to improve health care and national health systems.
MEPs underline that the EU-Africa relationship must “move beyond the donor-recipient relationship”. Instead, the EU and Africa should cooperate on equal terms, as part of an EU-Africa strategy that empowers African governments to achieve the UN Sustainable Development Goals (SDGs), curb climate change, and foster gender equality, among other targets. To achieve this, MEPs call for substantial funds to be earmarked for the SDGs in the upcoming external financial instrument NDICI - Global Europe.
COVAX vaccines delivered to 44 African countries: WHO (CGTN Africa)
44 African countries have received batches of COVID-19 vaccines through the World Health Organization’s COVAX facility, the agency said in Thursday, noting that 32 of those countries had already rolled out mas vaccinations. The WHO Africa region said in a statement that some 7.7 million doses had already been administered around the continent, though vaccine deliveries had begun slowing down. It urged for urgent supply of more vaccine doses as countries on the continent near exhaustion of their batches.
11 percent fewer goods imported from Africa (Statistics Netherlands)
Over the past fifty years, Dutch international goods trade - both imports and exports - has increased at a global level. Goods imports from Africa have not held pace with total imports. In the period 2011-2020, Africa’s share in Dutch imports stood at 3.1 percent. Whereas total Dutch goods imports fell by 7.8 percent last year, imports from Africa declined by 10.8 percent, resulting in a lower share in total goods imports, namely 2.6 percent.
The African share in total Dutch goods exports has stood at an average 3.2 percent over the past decade. Last year, exports to Africa were down by 10.4 percent, a stronger decline than total Dutch exports (-6.5 percent). Just as with imports, the contraction is primarily due to the coronavirus crisis as well as lower oil prices. Trade with Africa includes a relatively high share of oil and oil products.
The COVID-19 pandemic has reversed development gains for millions in poor countries, creating an even more sharply unequal world, according to a new UN report released on Thursday. “The global economy has experienced “the worst recession in 90 years, with the most vulnerable segments of societies disproportionately affected”, said the Inter-agency Task Force on Financing in their Financing for Sustainable Development Report 2021, pointing out that some 114 million jobs have been lost, and about 120 million people have been plunged back into extreme poverty.
Towards a robust, competitive trading environment (TT Newsday)
Trade facilitation is a fundamental driver for economic prosperity and sustainable development. Initiatives benefit both the private and public sectors as it increases administrative efficiency and reduces transactions costs associated with doing business. Ultimately, effective trade facilitation will propel economic development and a competitive business environment.
The TFA represents “the simplification and harmonisation of international trade procedures; that is the activities, practices and formalities involved in collecting, presenting, communicating, and processing data required for the movement of goods in international trade”. Broadly speaking, trade facilitation involves at the border measures, infrastructure relating to trade, simplification of trade procedures and documents, non-tariff measures, customs procedures and trade security.
However, since the onset of covid19, many efforts have regressed and businesses have suffered grave losses from inefficiencies as well as lengthy processing time of shipments.
The private sector needs are clear. Traders want transparent, accessible and predictable rules and procedures; harmonisation of legislation and regulations; a single access point for all public services and agencies; simple and efficient administrative processes; a fair system; and to be part of the policy making process.
Commodity super cycles are decade-long periods in which commodities trade above their long-term price trend. Some market analysts are seeing signs that a new super cycle is beginning now, pointing to a weakening dollar and supportive central banks and fiscal stimulus geared towards infrastructure spending as well as renewable energy.
The last supercycle could be summarized in a word: BRIC. Brazil, Russia, India, and China represented 2.6 billion people in 2000, or about 40% of world population. The idea was that the BRIC countries were on a path of rapid industrialization, which would require an unprecedented amount of raw
Opinion: Debt Moratoria in the Next Pandemic: Be Prepared, and Be Fair (Inter Press Service)
One of the questions before policy makers amid this new crisis is whether to extend moratoria to distressed borrowers. In search of answers, they reflect on the world’s experience with the COVID-19 pandemic and whether moratoria were part of the solution. These policy makers conclude that they did some things right in 2020. Just days into COVID-19 lockdowns, bank regulators in more than 115 countries granted special permission for financial services providers (FSPs) to extend moratoria to millions of borrowers, especially those with small business and consumer loans. These moratoria were the next best thing to cash in the wallet for borrowers who had lost their jobs or seen their business revenue plummet.
For lower-income countries, whose governments could ill afford welfare payments, moratoria became an important form of economic relief. And by relaxing provisioning on paused loans, these special moratoria also shored up FSPs’ balance sheets and prevented panic in financial systems. Through the moratoria, the world’s economies put the shock-absorbing capacity of financial systems to good use. But these policy makers also see that moratoria could have worked better in some respects.
New U.S. Trade Representative Katherine Tai pledged to rebuild alliances and actively engage on international trade on Monday in her first calls as the top U.S. trade negotiator with key partners and the World Trade Organization.
Starting her first full week on the job, Tai told WTO Director-General Ngozi Okonjo-Iweala that the Biden administration was committed to ensuring widespread access to COVID-19 vaccines, which the new WTO chief has made a priority. “The two exchanged views on the future of trade and their shared commitment to economic empowerment through a worker-centered trade policy,” USTR said in a statement, adding that they also discussed reform of the organization and its upcoming 12th Ministerial Meeting.
Tai, who was sworn in on Thursday, emphasized in calls to trade ministers the need to address climate change and racial equity in trade, and to work together to address concerns about forced labor and other issues related to China, her office said in a statement.
So what does such an extraordinary incident in the canal’s 150-year history mean for world trade? Global shipping routes have been massively disrupted after the Ever Given container ship found itself wedged sideways between the Suez Canal. Shipping was already under strain from the Covid-19 pandemic. The Suez Canal, which officially opened in November 1869 in Egypt, is one of the world’s most densely used shipping lanes in the world. It is also the longest one in the world, one without locks and that boasts a near-zero history of accidents.
The International Air Transport Association (IATA) today announced the launch of the IATA Enhanced Partner Identification and Connectivity (EPIC) platform to support the digitization of the global air cargo supply chain. EPIC simplifies the complex process of making digital connections across the air cargo value chain including enabling the efficient exchange of critical information such as messaging capabilities and identities. As the air cargo industry continues to digitalize, airlines, freight forwarders, ground handlers and customs authorities need to be able to securely work together digitally. This is a considerable challenge as today more than 40,000 freight forwarders exchange messages with more than 450 airlines, and 23 third party messaging service providers. In the absence of a tool for companies to exchange the information needed to make these business links, the process of digitization is essentially manual, slow and unduly complex.