National trade and trade-related news
South African trade rises on a tide of rallying commodity prices but government must boost economy to withstand a turnaround (Daily Maverick)
Buoyant global trade and record-high commodity prices continue to underpin SA’s healthy trade balances. But the government cannot rely on this as its sole source of economic dynamism. An impressive recovery in global goods trade and an average 30% rise in commodity prices over the past year have provided a much-needed uplift for the South African economy at a time when good news has been in short supply.
Last week’s news that the value of exports had risen to an all-time high in March encapsulated both the growing global demand for goods that require commodities as inputs and the escalation in their prices as a result.
The tailwinds behind the much faster than expected recovery in commodity prices include the increasingly optimistic global growth forecasts and anticipated demand from the large green infrastructure investment programmes planned in both developed and emerging markets.
Manufacturing industry soars to nine-year high (IOL)
The manufacturing industry in South Africa soared to nine-year high in April as new business and output grew strongly as a result of a sharp rebound from the Covid-19 impact.
The IHS Markit purchasing managers’ index (PMI), released yesterday, rose from 50.3 in March to 53.7 in April as demand begins to recover, indicating the strongest expansion since March 2012.
IHS Markit said South Africa enjoyed a strong bounce in economic performance in April as output growth soared to the fastest for just more than nine years. It said new business also rose at a marked pace, supported by strengthening customer demand as markets recovered further from the Covid-19 pandemic.
Covid could reignite SA’s industries - Sunday World
Business leaders in the manufacturing industry believe that the Covid-19 crisis could be a catalyst for Africa’s next industrial revolution. kabelo, CEO of KAS Africa, the continent’s leading contract manufacturer of personal, home, baby and oral care FMCG products, said the upheaval of global supply chains caused by the pandemic has helped to highlight how important local production capacity is to ensure the resilience of local economies and continuous supply of essential products. “The virus outbreak has put South Africa’s manufacturing sector under enormous pressure,” she said.
According to a study by Deloitte, manufacturing is one of the top three multiplier sectors in terms of value addition, job creation, export earnings and revenue generation for every R1 invested. “Even before Covid-19, we were seeing a significant reconfiguration of global value chains. The African Continental Free Trade Area (AfCFTA) and South Africa’s close ties with the BRICS bloc mean that there are exciting opportunities to grow exports,” Perumal said.
The sector declined from 26% of South Africa’s gross domestic product in 1994 to less than 14% currently. The Department of Trade, Industry and Competition has pursued several policies to “localise” more manufacturing in the country in an effort to re-industrialise Africa’s most advanced economy.
Successful localisation programme requires consistent renewables procurement pipeline (Engineering News)
To achieve a successful localisation programme with incremental local content thresholds as part of the Renewable Energy Independent Power Producer Procurement Programme (REIPPPP), a consistent procurement pipeline needs be established, says industry association South Africa Wind Energy Association (SAWEA) CEO Ntombifuthi Ntuli. The stop-start nature of procurement, and latent bid windows, severely damaged the meaningful momentum, pre-2015, which established new manufacturing capacity within the wind and solar value chains in South Africa.
A consistent procurement pipeline would be a positive development, as it facilitates augmented job creation and skills development as the economy recovers from the Covid-19 pandemic and accelerates economic growth, she adds.
“While we celebrate the new impetus, one must be mindful that regaining the investor confidence will not be an overnight process. To enable the required quantity and, importantly, quality of components will require at least two to three years of investment and development. “It is, therefore, crucial that further interruptions or delays are not encountered. A controlled rollout of procurement will allow all aspects of the value chain, and not only the manufacturing sector, to expand,” she says.
Legal bid to review Mining Charter (IOL)
The Centre for Applied Legal Studies and Lawyers for Human Rights are representing some of the communities. Several trade unions have also joined the fray. The review application was brought by the Minerals Council of South Africa (the former Chamber of Mines), against the Ministry of Mineral Resources and Energy. The Gauteng High Court, Pretoria, is hearing arguments to review the 2018 Mining Charter, which several affected communities feel was developed without meaningfully engaging with them.
The applicants and interested parties want a new Mining Charter that all stakeholders can support.
Powering the economy through alternative energy (SAnews)
South Africa is finalising the much-anticipated Hydrogen Society Roadmap as the country shapes its industrialisation and economic pathway. This development was recently outlined by the Department of Science and Innovation’s (DSI) Chief Director for Hydrogen and Energy, Dr Rebecca Maserumule. Crafting the document began last year and is expected to be finalised in the next three months.
“We think that around this transition, the lynchpin is hydrogen – that is with prior emphasis on green hydrogen. The emphasis of the roadmap really is how do we, as South Africa, try to find insights in the expectations and purposes towards how we should make this movement?”
The roadmap is a collaborative roundtable of which all relevant stakeholders are at equal footing and the issues of gender equality and social inclusion are at the forefront.
President Cyril Ramaphosa: Roundtable on Pandemic Preparedness | South African Government
We know that it is the virus that causes the disease, but it is human action – and inaction – that causes the pandemic. A vital lesson from the coronavirus pandemic is the necessity for collective leadership, collaboration, solidarity and innovation among the countries of the world.
From the outset, these are the principles that have guided Africa’s response to COVID-19. By working together through the African Union, in March 2020 the countries of the continent developed and began implementing the Africa Joint Continental Strategy for COVID-19 Outbreak.
While the pandemic has highlighted the value of partnership, it has also demonstrated the damaging effects of unilateral action and unequal access to resources. We cannot hope to overcome this pandemic for as long as richer countries have most of the world’s supply of vaccines to the exclusion and the detriment of poorer countries. As we prepare for future pandemics, we need to accelerate efforts to realise Universal Health Coverage. We need to ensure that vaccines and other life-saving treatments are considered a public good.
Shortage of containers impacts on trade (Chronicle)
The Shipping Industry is at sixes and sevens as the industry tries to grapple with container shortages to ship goods across the world. Numerous reasons have been advanced around the global container shortage and the consequent impact on global trade. The causes of the predicament while mixed, actually present a complex scenario compounded by the Covid-19 pandemic and the nature of the shipping industry.
With improved technology, big vessels have become choice vessels so as to capitalise on capacity and economies of scale. Ever Given is 400m long and these are the going dimensions of these ships creating challenges of docking at most ports, that still have to adjust facilities to cater for large vessels like Ever Given compounded by the dis-economies of scale as articulated by another trade expert.
China apparently was the first country to experience Covid-19 and was also the first country to get out of it and position itself ahead of other countries to embrace the opportunities. Studies reveal that China exports far more than it imports and has been impacted by the shortage of empty containers according to the Africa Container Shipping.
Areas like Africa have a surplus of empty containers as they import more than they export. Out of 4 full container loads (FL) 3 containers return empty reports Africa Container Shipping. In addition, it takes more time to return the empty containers due to staff shortages caused by lockdowns.
Turning point as Tanzania’s gold exports pass $3 billion mark (The Citizen)
Tanzania’s gold shipment hit $3 billion mark for the first time as price of the precious metal increased in the world market. According to the Bank of Tanzania, the value of the exports of gold to $3.025 billion in the year ending March 31, 2021, compared with $2.324 billion recorded previously. During the year to March 2021, gold exports accounted for 55.9 percent of non-traditional exports after increased by $701.3 million to $3.025 billion. The increase is associated with “an increase in the market price of gold and government initiatives in supporting the mining industry,” the central bank stated.
Domestic air travel fares double on high demand (Business Daily)
The cost of domestic flights has doubled on some routes since Sunday when the air travel resumed after the lockdown as airlines record high demand, forcing carriers to increase frequencies on different routes. Kenya Airways ticket price have shot to Sh10, 050 on Mombasa and Kisumu routes from a low of Sh5, 000 when the flights resumed on Sunday. KQ, which started with two flights to Mombasa and one in Kisumu on Sunday, has so far added additional flights on these routes.
Curbs on travel in the Nairobi and four surrounding counties were lifted Saturday following the easing of restrictions that saw a reopening of bars and restaurants, religious services and schools as the rate of infections eases.
Kenya scraps work visa for Tanzanians (Business Daily)
Kenya has scrapped work visa and permit requirements for Tanzanian nationals in an effort to boost trade and tourism between the two countries, fast-tracking implementation of East African Common Market Protocol allowing workers to move freely in the region. President Uhuru Kenyatta announced the new visa policy on Wednesday during a joint session of Kenya and Tanzanian business community in Nairobi, which was attended by the visiting Tanzanian President Samia Suluhu. President Kenyatta said the move would allow Tanzanians to enter the country without restrictions and work freely, attracting foreign investment and boosting tourism without compromising national security. “The objective is to strengthen our two economies by promoting easy movement of goods and people,” said President Kenyatta.
Oil pipeline-related splurge raises Uganda real estate industry spirits (The East African)
Commercial activity surrounding the recent signing of key agreements related to the 1,445km East African Crude Oil Pipeline Project (EACOP) and a surge in oil explorers’ procurement budgets have increased hopes of recovery in the country’s real estate industry that has been hit hard by the coronavirus pandemic.
The total value of industry contracts fell to $21 million in 2019, a pattern attributed to prolonged days tied to the announcement of the Final Investment Decision (FID) for Uganda’s commercial oil production programme, as well as drawn out income tax disputes between the Uganda Revenue Authority and international oil companies amid shrinking global crude oil prices.
Non-oil exports: FG pledges improved funding for exporters (The Sun Nigeria)
Amidst the dwindling fortunes of the oil and gas sector exacerbated by the impact of COVID-19 pandemic, the Federal Government at the weekend expressed concern over Nigeria’s poor records in exportation of manufactured and value added products, stressing such developments pose grave danger to its balance of trade and payment positions. This was as it lamented that crude oil still accounts for over 95 percent of the country’s export earnings.
Speaking at an export facilitation workshop organised by the Association of Business Editors in Nigeria (ABEN) themed; Strengthening Economic Recovery in a Pandemic Through Aggressive Non-oil Export Drive: Prospects and Challenges in Lagos, at the weekend, Head of Strategic Planning at NEXIM Bank, Mr Tayo Omidiji, who represented the Managing Director of the bank, Mr Abubakar Bello, stated that while the Nigerian economy remains diversified, its external sector is still dominated by oil and gas trading which accounts for over 90 per cent of foreign exchange earnings. He explained that Nigeria recorded trade deficit of N7.38 trillion in 2020, compared to a surplus of N2.23 trillion in 2019, reflecting the confluence of 17.32 per cent increase in import and a 34.75 per cent decline in export during the period.
Omidiji recalled that the nation’s total trade declined by 10.32 per cent in 2020, as crude oil export shrank by 35.71 per cent to N9.44 trillion in 2020, while the non-oil export also declined by 32 per cent reflecting the colossal collapse of economic activities during the period of the pandemic in 2020. He said that agricultural commodities equally recorded price declines owing to COVID-19 related factors that affected several sectors of the economy.
Tanzania pledges to strengthen trade ties with Nigeria (Premium Times)
Tanzanian High Commissioner to Nigeria, Benson Bana, has pledged his government’s commitment to boost the volume of trade with Nigeria to promote intra-Africa trade.
SON to leverage accredited labs to end rejection of exports (The Guardian Nigeria)
The Standards Organisation of Nigeria (SON) has stated that by leveraging its three accredited laboratories, the country would witness a gradual end to the incessant rejection of locally-made goods at the international market. Besides, the agency noted that with the African Continental Free Trade Agreement (AfCFTA) in full force, the unveiling of the accredited labs is apt as it would make made-in-Nigeria compete favourably with imported goods. The Director-General, SON, Farouk Salim, at the unveiling of its accredited laboratories in the Ogba area of Lagos, said the laboratories would encourage manufacturers to produce quality goods and bring to an end, the high level of rejection faced by exports from Nigeria.
In his words: “Most of our manufacturers have been complaining that their products were rejected even by our local companies because the products are not certified because they do not have laboratory certificates to authenticate the standards. Now, that excuse is out of the way. Due to the export potentials of our industries and with the certification, it is easy for them to export anywhere in the world because an accredited laboratory means that whatever we say is good is good. It gives the nation credibility, it gives our manufacturers credibility, and it saves our foreign currency because they do not have to go to neighboring countries to get their products certified anymore so it is a win-win situation for everybody.”
Startups vital to future of Nigeria – Osinbajo (The Sun Nigeria)
The Vice-President of Nigeria, Professor Yemi Osinbajo, said that the startup ecosystem is one of the vital tools in finding solutions to Africa’s various challenges. According to him, these challenges will determine if the continent’s future as the next frontier for economic opportunities will fully be realised.
He stated the topic, “The African Start-up Ecosystem Opportunity,” was exciting because the startup ecosystem was extremely critical to the future of Nigeria and Africa at large. “Globally, the startup ecosystem is the most viable platform for innovators and entrepreneurs to take their ideas from inception to impact. It brings relevant stakeholders together to collaborate and bring something new to the world or new to an industry. There will never be a more perfect time to strengthen the African startup ecosystem than now, on the verge of the fourth industrial revolution,” he said. Osinbajo noted that the third industrial revolution was pivotal to unprecedented global economic growth in the 21st Century, as it disrupted traditional service delivery channels and accelerated the automation of factories and manufacturing processes, using electronics and information technology to expand reach and create prosperity, but Africa hopped along and missed out.
“Today, Africa is presented with another opportunity, the fourth industrial revolution, which is shaping and creating economic activities. It is proving to be the catalyst for future economic activities that will bridge the divide between rich and developing countries, and remove physical borders and barriers while maximising the utilisation of digital technologies as a source of inspiration across economic sectors,” he said. “The African startup ecosystem opportunity is hinged on two key factors, which are anchored on the fourth industrial revolution and driven primarily by digital technologies. The first factor is innovation capacity, and the second one is entrepreneurial capacity. Both capacities depend on four key indicators, human capital, infrastructure, funding and demand.
FG to automate Nigerian ports operations (The Sun Nigeria)
As part of the Federal Government’s plan to automate operations in the Nigerian ports, Nigerian Ports Authority (NPA) yesterday signed an agreement with National Bureau of Statistics (NBS) with a view to automating data collection and gathering in the ports. Listing the benefits of automating the operations, at the signing of the Memorandum of Understanding (MoU) between the two agencies in Abuja, the Managing Director of NPA, Hajia Hadiza Bala Usman, said that the automation will bring timely access to data exchange for planning, research, monitoring, projections and reporting across port industry. “I would like to specifically request the collaboration of automation of data collection. This is an area that we really require support on how we can really move towards automation of data which will eliminate errors and also have live and up-to-date information as and when required.
FG ready to deploy 5G technology (The Sun Nigeria)
The Federal Government has announced it is going ahead with arrangements to deploy Fifth Generation (5G) Technology in the telecommunications industry. The government allayed fears and concerns on health and security implications over deployment of 5G, asserting Nigeria cannot afford to be left behind. It added the resources and revenues to be earned from the deployment are so huge they cannot be ignored.
Executive Vice Chairman of the Nigerian Communications Commission (NCC), Prof Umar Garba Danbatta said: “Among the Frequency Spectrum bands allocated to 5G by the International Telecommunications Union (ITU), the C-band (3.4GHz – 3.9GHz) stands out because its balancing point between coverage and capacity provides the perfect environment for 5G connectivity.
‘Nigeria’s debt profile, servicing worrisome’ (The Sun Nigeria)
Recently, the Federal Government sourced $3.4 billion loan from IMF, $2.5 billion loan from the World Bank, $1 billion loan from AfDB, as well as N850 billion domestic capital market loans among others.
Economists have insisted that the continuous borrowing by Nigeria was not good for the economy, going by the huge amount spent on servicing those debts, they also noted that Nigeria’s debt to revenue and debt to Gross Domestic Product (GDP) ratios are becoming unfavourable. The economists advised that Nigeria needs to be more proactive in public financial management as the economy is contracting and the country’s public debt profile is becoming unfavourable.
On the country’s rising debt profile, the former NACCIMA DG put the blame at the door step of government, saying it was inappropriate to borrow money for salaries and at the same time give bailout to states for salary payments
The Director-General, LCCI, Dr. Muda Yusuf, noted that the high level of debt servicing continues to hinder robust investments in hard and soft infrastructures which are key to stimulating productivity and improving living standards.
High-level visit to Nigeria signals strength and importance to UK-Nigeria partnership (GOV.UK)
During the 4-day visit, the Mr. Duddridge and Ms. Grant covered a wide range of issues, including human rights, girls’ education, and electoral reform. They discussed how the UK can work in partnership with Nigeria to address insecurity; and how to support economic development and mutual prosperity as the world builds back better from COVID-19.
During the visit, the Minister for Africa and the Trade Envoy attended the signing of a Memorandum of Understanding between the Nigerian Sovereign Investment Authority and Konexa, a British company, which will help increase sustainable energy access in Nigeria. The delegation also visited a government secondary school in Abuja that is currently being supported by the British Council’s Connecting Classrooms programme.
At the end of the visit, the Minister for Africa, James Duddridge MP, said: The UK-Nigeria relationship matters to both countries. Over 4 days, we have covered a wide range of issues, including how best to strengthen trade and investment cooperation, how to get and keep more girls in school, and how to work more closely together on global challenges such as COVID-19 and on climate change ahead of COP26.
Access Bank: Leveraging debt recovery for sustainable growth (The Nation Newspaper)
Access Bank Group Plc’s audited result showed an improvement in the non-performing loans (NPL) ratio. NPL improved from 5.80 per cent in 2019 to 4.30 per cent in 2020. The lower ratio reflected successful approach to loan recovery adopted by the Group which is fast gaining the reputation as Nigeria’s toughest loan recovery machine. The bank’s new investments in technology and rising commitment to Africa trade through the African Continental Free Trade Agreement (AfCFTA) scheme are lookouts to drive its new growth phase
While the agreement is not a silver bullet, due to structural barriers to trade, Group Managing Director, Access Bank Plc, Herbert Wigwe, said he saw many benefits to the bank and the various African economies within the AfCTA deal.
In a report entitled: Realigning for Growth released by the bank, Wigwe said the lender would be optimising and taking maximum gain of the trade agreement by repositioning its operations and payment platforms to serve more customers across the continent.
Chinese rice farm trains talents to solve Nigeria’s food problem (CGTN Africa)
Rice is a major food crop in Nigeria, the most populous country in Africa. However, rice production remains insufficient in the country due to technological and financial constraints, and food system and markets are perennially disrupted by spreading violence and COVID-19-related restrictions. Many Nigerians still suffer from hunger.
For decades, China has been sending agricultural experts and technicians to the African continent. “From there we knew the reason why we had low crop output despite all the efforts before. We need to change our mindset. We have to do proper irrigation and make good use of farm machines,” Ibrahim told Xinhua, speaking of his experiences with Wara.
Ghana set to receive first LNG cargo at end of May (S&P Global)
There are a number of LNG export projects across North and West Africa, but Egypt in 2015 became the first -- and so far only -- African country to import LNG. Ghana is now expected to receive its first LNG cargo at the end of this month, a project spokesman said May 4, as the country prepares to become sub-Saharan Africa’s first LNG importer.
The project -- consisting of separate regasification and storage vessels -- has the capacity to import 1.7 million mt/year of LNG and had been expected to receive its first cargo by the end of Q1 2021. “The first cargo is currently expected for the end of May,” the spokesman for the project -- backed by Helios Investment Partners and Africa Infrastructure Investment Managers -- told S&P Global Platts.
But that is set to change as Ghana gears up to begin LNG imports, the first in sub-Saharan Africa. LNG will be supplied under a long-term contract with Shell, which said in a February strategy presentation that it wanted to grow its LNG market footprint by creating new markets, including being a first supplier of LNG to Ghana.
UNU-WIDER : Report on the impact of COVID-19 to Ghana’s labour market hits headlines
A new report from the Transforming informal work and livelihoods project has caught the attention of policy makers and media in Ghana. Researchers from UNU-WIDER and the Institute of Statistical, Social and Economic Research (ISSER), University of Ghana, Legon conducted a survey with more than 600 workers in different cities throughout Ghana to assess the immediate and near-term impact of the COVID-19 pandemic on labour market outcomes. These data have been analysed and published in the new report delivering novel insights on how the pandemic and related policy measures have impacted the livelihoods of workers and their families. In the report, the researchers provide a comprehensive overview of their findings, which can help inform future policies.
Malawi Country Partnership Framework – A Focused and Flexible Engagement Strategy (World Bank)
The Malawi Country Partnership Framework (FY21–25) supports the country’s goal of creating more jobs, strengthening human capital and increasing economic growth and accountability. Informed by extensive consultations with a broad range of stakeholders including the government, civil society organizations and development partners, the CPF is aligned with Malawi’s strategic development priorities on self-reliance and economic transformation as outlined in Malawi’s recently-launched vision document, Malawi 2063 (MW2063).Malawi’s recently launched vision document, “Malawi 2063” (MW2063) targets lower-middle-income status by 2030 through a focus on three pillars: commercial agriculture, urbanization, and industrialization.
Malawi’s CPF for FY21–25 targets three strategic areas; reinforcing foundations for growth and accountability; promoting private sector-led jobs and livelihoods; and strengthening human capital development. In addition, the CPF pays special attention to two cross-cutting issues of women’s empowerment and digital development. These priority areas are guided by Malawi’s development vision as laid out in the MW2063, which targets the country’s lower-middle-income status by 2030 through a focus on three pillars: commercial agriculture, urbanization, and industrialization, as well as the 2018 Systematic Country Diagnostic (SCD) and with the forthcoming IFC-led Country Private Sector Diagnostic (CPSD).
Safeguarding Sudan’s Vulnerable: Creating Economic Opportunity in Times of Crisis (World Bank)
In the rural localities of Eastern Sudan that are home to displaced people and the communities who host them, the greenery can be deceptive. The flat desert is dotted with tiny villages sprawls for miles around, and the only colors to be seen are in fields of okra, pumpkins, tomatoes and the bright clothes of women farmers harvesting their vegetables in small farms surrounding their neighborhoods.
A group of women are all smiles as they go through their record books and count the revenue gained from their community horticultural gardens and livestock production. These activities offer them major opportunities to strengthen food security and to improve their livelihoods, a big contrast from the past, when the women in these communities had far fewer economic opportunities.
This kind of dramatic transformation has been made possible on a large scale with the support of the Sustainable Livelihoods for Displaced and Vulnerable Communities in Eastern Sudan Project (SLDP). Funded by the government and the World Bank State and Peacebuilding Fund (SPF), the government-implemented project was designed to strengthen the capacity of local stakeholders, including state authorities, displaced persons and vulnerable host communities, to plan and implement improved livelihood and natural resources management practice. With a budget of $7.135 million, it consisted of two phases over an eight-year period, beginning in 2013 and ending in 2021.
African regional and continental news
Let’s publish tariff concessions – African Council of Ministers to AfCFTA member states (GhanaWeb)
he African Council of Ministers in charge of the Africa Continental Free Trade Agreement (AfCFTA), is charging all member countries to publish their various tariffs, concessions and trade schedules for all traders. The move is to ensure transparency in trading and also to make member countries aware of what products and tariffs are being traded under. The Council of Ministers in charge of AfCFTA which is the second-highest body made their expectations at the 5th Session meeting in Accra. Secretary-General of the AfCTA Secretariat, Wamkele Mene told a virtual media conference.
“Another critical expectation by the Ministers in the next few weeks is that member states should be in the position to publish all their schedules of tariff concession which gives an exporter certainty over tariffs and taxes that will be applied to them”.
He believes the move will boost investor confidence on the continent as well as giving more African entrepreneurs hope.
Public-Private Partnerships (PPPs): Africa’s reliable driving force for Industrialisation | AUDA-NEPAD
The substantive participation of the private sector in driving Africa’s development and wealth, calls for a stronger Public-Private Partnerships (PPPs) approach between the governments and private firms. Considering the significant challenges of unemployment especially amongst the youth, that afflicts Africa, given her young population, the private sector can be part of the solution. The private sector can be a key contributor in the establishment of more industries that can contribute significantly to the reduction of youth unemployment.
Regardless of the challenges surrounding the private sector ecosystem, its contribution as an engine to Africa’s industrialisation process and economic development at large remains relevant. Even though, we can also not ignore the voices of those who posit that capitalist is at the core of an unequal society driven by private sector accumulation but there is room for improvement. Private sector active participation in key economic areas such as agriculture, industries, and services provision contribute immensely to the total GDP growth of Africa’s economy while according to AfDB provides about 90 percent of employment opportunities including formal and informal jobs.
For Africa’s industries to reap from the operationalisation of the African Continental Free Trade Area (AfCFTA) that has been operational from January 2021, the public and private sectors have to work together.
Therefore, as we are keen to enjoy the fruits of AfCFTA, its role in the future of industrialised Africa will depend on how the public sector engages and embrace its private sector as a partner and not a competitor in promoting development. The involvement of governments in particular relationships must be redefined for PPPs to come full circle. The predicted evolution would prevent African governments from acting as both managers and financial sponsors, a move that should benefit the public at large.
The impact of COVID‐19 on African economies: An introduction (Wiley)
Over the last 14 months, Africa and the entire world experienced the worst Socioeconomic challenges of alarming proportion.
With the exception of a few, most governments all over the world initially downplayed the pandemic until it turned to sustained community‐level transmission. Once governments noticed cases getting out of hand, the first response became mask mandates, closure of the international borders, with more stringent social distancing measures, and subsequent physical restrictions (lockdowns and shutdowns) of the Socioeconomic activities to restrict human movements, excepting those on essential services like medical and security personnel. Testing, tracking, therapeutic management of those infected as well as quarantines and isolation of positive cases became the norm.
International financial institutions (including the African Development Bank) collectively mobilized a global response package of US$230 billion between 2020 and 2021, to aid the global response to the coronavirus pandemic. The funds were raised to reduce the pandemic’s impact, of which US$75 billion were to be directed to the world’s poorest countries in 2020.
As the COVID‐19 pandemic accelerated, Socioeconomic damage was increasing in Africa and all over the world. However, the curve of the pandemic within and outside the continent is flattening gradually in some individual countries while rising in others.
The COVID‐19 pandemic and the measures deployed by governments and private sector institutions to contain its spread—lockdowns, quarantines, social distancing, travel bans and restrictions, masking requirements, shutdowns of non‐essential activities—have caused severe socioeconomic dislocations on African economies. Many African governments responded with programs to mitigate personal hardship and disruptions to economic life. At the same time, central banks have cut policy rates and injected liquidity on an extraordinary scale in the economies. Therefore, it is not surprising that the pandemic and the actions taken to contain it have exacted substantial costs on African economies, including deep economic contractions. Specifically, some of the socioeconomic impacts of the COVID‐19 pandemic are enumerated below.
The Fourth Industrial Revolution in sub-Saharan Africa: key to the coronavirus recovery? (Oxford Business Group)
The coronavirus pandemic has significantly accelerated the global spread of technologies associated with the so-called Fourth Industrial Revolution (4IR), among them artificial intelligence, internet of things (IoT), big data and blockchain. In sub-Saharan Africa, many now see 4IR as key to the region’s recovery. Progress towards the 4IR – characterised by the fusion of technologies in the physical, digital and biological spheres – was already under way in sub-Saharan Africa prior to Covid-19. In Kenya and parts of West Africa, for instance, blockchain was used to verify property records, while Ghana-based companies Farmerline and Agrocenta used mobile and web technology to support farmers.
Various factors stand the sub-Saharan region in good stead to take advantage of 4IR technologies. For example, in recent times the region has seen a massive expansion of mobile technology, with consumers leapfrogging traditional development channels straight to digital services, particularly with regard to banking. Africa also boasts disproportionately high numbers of young people, a demographic dividend which is already bearing fruit in terms of the 4IR.
Further to this, a report published at the end of 2019 by the African Development Bank (AfDB) noted that IoT had expanded considerably in Africa, while there had been strong investment growth in technology-led areas. The report found this unsurprising, given the transformative impacts that such technologies can have in sectors as varied as agriculture, manufacturing, health care and governance.
But the report also highlighted a range of challenges, among them ICT infrastructure gaps and the fact that the start-up ecosystem was under-capitalised.
Africa sees the fastest recovery in air cargo – with new record highs – but passengers scarce (Business Insider South Africa)
Global air cargo demand reached an all-time high in March, with African airlines posting the fastest recovery and increasing freight volumes by 24.6% compared to the same pre-pandemic period in 2019. Following a dismal 2020, when global air cargo volumes dropped by 10.6% – the largest decline in 30 years – the freight industry has shown a remarkable recovery in the first quarter of 2021.
And although Africa has shown the swiftest recovery in air cargo demand, it’s also the only region to report a month-on-month decline in Revenue Passenger Kilometres (RPK) between February and March. RPK measures the number of kilometres travelled by paying passengers.
Tax forum reminds businesses that there’s money to be made in Africa (Eyewitness News)
The African Tax Administration Forum said the continent signed away billions of dollars through tax incentives for businesses. Speaking at the 5th high level tax policy dialogue, the forum’s executive secretary Logan Wort reminded businesses attending to come to Africa because there was money to be made and not because of incentives.
“It is not tax incentives that attract direct investment, that’s a myth. Direct investment is attracted to a stable economy, good infrastructure, a good educated workforce and political stability. Those are things that attract investment,” said Wort.
ECA’s development of value chain investment tool for Central Africa gains traction | United Nations Economic Commission for Africa
Imagine development planners in Central Africa getting their hands on a smart and integrated tool which helps them identify the most profitable points to deploy investments for the expansion and deepening of value chains in agribusiness, manufacturing, mineral transformation and beneficiation as well as an endless flow of renewable energy to leverage their current development plans! The United Nations Economic Commission for Africa (ECA) has just presented results of its findings using such a geospatial and investment planning tool to member States, the economic communities of the sub-region, and other development partners and experts during an online workshop presided by Cameroon’s Minister of Economy, Planning and Regional Development, Alamine Ousmane Mey, this Wednesday. ECA’s preliminary geospatial-data driven analysis on economic opportunities along Central Africa’s transport corridors showcases the far-northern regions of Cameroon, connected to the whole of Chad as one of Africa’s best spots for the development of a value chain in wind and solar renewable energy.
AGRA announces partnership with Aceli Africa to support African agribusiness SMEs | AGRA News Center
AGRA has today announced a partnership with Aceli Africa to enhance capital flows to SMEs in the agriculture sector and support a financially inclusive agricultural transformation across Africa. AGRA and Aceli have signed a letter of intent committing to jointly work together to test and scale up innovations that substantially drive down the cost and risk of financing SMEs in the agriculture space. Aceli Africa is a market incentive facility that offers financial incentives to mitigate risk and compensate lenders for the transaction costs of serving high-impact agricultural SMEs. Aceli plans to support its 25 lending partners in mobilizing $700 million in financing for agri-SMEs by 2025 with a focus on SMEs that are gender inclusive, improve food security, and practice climate-smart agriculture.
Optimising Agricultural Value Chains in Southern Africa After COVID-19 | SAIIA
Priorities going forward include enhancing food security in the SADC region, making more productive use of the small-scale farming sector and using the African Continental Free Trade Area as a lever for agricultural and regional development. These effects have also been felt in the Southern African Development Community (SADC) across agricultural value chains, impacting regional food security, intraregional trade and economic growth.
African Development Bank holds webinar on accountability for Southern African CSOs (AfDB)
Civil Society Organizations (CSOs) from eight Southern African countries participated in a webinar on accountability and good governance in projects funded by multilateral development banks.
“The role of CSOs in promoting principles of transparency and accountability, and in amplifying citizens’ voice and participation are key ingredients in achieving inclusive and sustainable development,” said Vanessa Moungar, Director of the Bank’s Gender, Women and Civil Society, in opening remarks.
The webinar, organized by The African Development Bank, aimed to sensitize the groups about the role and importance of independent accountability mechanisms and how greater transparency and accountability in development bank-funded projects enhances social and environmental impacts for beneficiaries.
Story: Tech Hubs critical to Africa’s COVID-19 recovery (ITC)
Tech hubs have taken on a key role in the digital transition in African nations. With traditional work methods moving increasingly towards automation, tech hubs provide start-ups with training and capacity building, from ideation to market readiness. “Technology is our new reality,” says Joseph Mwanyika, executive director of Ennovation for Change, an NGO start-up supported by and working with Ennovate Hub in Tanzania. “For example, access to transportation, education, and health is all now increasingly online,” he continues. “As a result, tech hubs are incredibly important in the African entrepreneurship ecosystem: they play a vital role in supporting entrepreneurs and the entrepreneurship ecosystem. However, they also need support themselves,” the Executive Director acknowledges. As part of the ecosystem support provided under the International Trade Centre’s FastTrackTech Africa initiative, a capacity-building workshop for 60 tech hub leaders from 19 African countries focused on how to operate effectively and offer value-added services as a support organization.
Marching towards an equitable economic recovery in eastern and southern Africa (The East African)
The coming months will be challenging, but also present opportunity to implement reforms and interventions that contribute to long term and inclusive growth. Covid-19 has reversed the downward trend in global poverty for the first time in a generation. Global poverty is projected to push more than 100 million people into extreme poverty of which one-third are in sub-Saharan Africa where 40 per cent of the population already lives in extreme poverty. Even if we witness an economic recovery globally this year, we cannot expect a dramatic reversal in poverty levels due to the long-term damage caused by Covid-19. The pandemic is expected to reduce global potential growth and require, going forward, fiscal adjustments to tackle the increasing debt levels in many eastern and southern African countries. The coming months present an opportunity to implement reforms and interventions that contribute to long term growth that is more inclusive.
Just as we have fast-tracked the Covid-19 response, we must fast-track the building blocks of sustainable infrastructure investment.
This means governments should work to attain robust legal frameworks, transparency, and regulatory certainty for infrastructure sectors.
Another example of where countries rely on public infrastructure for economic recovery is the joint effort of the Horn of Africa that intends to upgrade roads in key trade corridors starting with the Isiolo-Mandera in Kenya.
It is being supported by a $750 million operation and in addition to building the new infrastructure and improving road security, the project is expected to contribute to an expansion of trade between the countries by increasing coordination, reducing trade costs and time, and developing regional value chains.
Focus on Africa free market, UNDP tells govt (Daily Monitor)
“Agro-industrial processing remains strategic to Uganda. Industrialisation is an important foundation for entrepreneurship, business development, export revenues, poverty eradication, rapid and sustained prosperity and attracting foreign direct investment,” she said.
The United Nations Development Programme (UNDP) has advised government to use the national industrial policy launched yesterday, to tap into the 1.2billion African Continental Free market. Speaking at the launch, Ms Elsie Attafuah, the UNDP country representative, said Covid-19 has exposed certain realities in more developed countries which started looking internally for market, adding that it is crucial for Uganda to look at the Intra-Africa trade to help the country regain growth after Covid-19. “Industrialisation is the key to economic transformation through export revenue, poverty eradication, sustained prosperity, which will contribute to inclusive growth, resilience, transformation of the economy and society. It will bring foreign- direct investment and international competitiveness,” she said.
EAC Partner States have no option but to accelerate the integration process (East African Community)
East African Community Partner States have no option but to accelerate the integration process if the region is to become competitive in the global economy, Ugandan President Yoweri Museveni has said. President Museveni said that failure by the EAC Partner States to form a stronger, more cohesive bloc with a bigger market would be disastrous for the region in the long run. “Integration is not really something we will do or not do. It is a must. If we don’t we shall end up in a very bad situation. The question we should be asking ourselves as we seek to integrate is why need to integrate. If we can answer that question, the how will become quite easy,” said President Museveni.
President Museveni said that EAC Partner States markets operating individually were small and therefore need to integrate into a bigger one. “We need to solve the issue of market or else we shall continue enriching other countries,” said the Head of State.
said that businesspeople in East Africa were in full support of the integration because they were very much inconvenienced by national borders and other non-tariff barriers.
One currency for Africa (MyBroadband)
Jordaan said this low base meant there was great potential to increase intra-African trade and use it as a growth opportunity.
A single currency for Africa will make it much easier to trade and invest across the continent, but because all countries are unlikely to agree on a central bank or monetary policy it will likely have to be a decentralised cryptocurrency. This is the view of Montegray Capital founder, venture capitalist, and former FNB CEO, Michael Jordaan. Jordaan said intra-African trade – trade between countries in Africa – and not foreign aid, is the key to sustainable development in Africa. The United Nations Conference on Trade and Development (UNCTAD) highlighted that Africa is lagging far behind other regions when it comes to intra-continental trade.
There are, however, many non-tariff barriers like delays at border posts or non-standardised customs procedures which are holding the continent back. Jordaan said these bottlenecks will have to be resolved to optimise trade between African countries. Another big challenge for intra-African trade is making it easy for big and small exporters to be paid by anyone in the world.
France begins transfer of €5bn to BCEAO as part of CFA franc reform (The Africa Report)
During his visit to Abidjan from 29 to 30 April, Bruno Le Maire, France’s minister of the economy and finance, reassured Côte d’Ivoire’s President Alassane Ouattara that the CFA franc reform agreements approved in December 2019 would be implemented in their entirety.
France has begun the process of transferring €5bn to the accounts of the Banque Centrale des États de l’Afrique de l’Ouest (BCEAO). Paris’ decision comes within the framework of the reform of the CFA franc, which will be replaced by the eco. The resources in question are the foreign exchange reserves held in the Bank of France’s books that cover the imports of the countries of the Union Economique et Monétaire Ouest-Africaine – Uemoa (West African Economic and Monetary Union).
Despite the numerous points to be clarified by the countries of the Economic Community of West African States (ECOWAS) in regards to the value of the eco to the euro, officials in Abidjan have insisted that these member countries commit to completing the process of converting to the new currency, despite the change in the initial schedule.
ECOWAS countries urged to invest in data production - Xinhua | English.news.cn
Members of the Economic Community of West African States (ECOWAS) should invest more in data production to boost their economic development, said an ECOWAS official here Wednesday. Kofi Konadu Apraku, ECOWAS commissioner for macroeconomic policy and economic research, made the remarks at the ECOWAS regional statistical coordination meeting held in Accra. The development of new data sources, including big data, should be exploited to improve the provision of official statistics to leverage advances in new technologies that would make data production easier and more cost-effective in the region.
EAC seeks tighter hug from ‘Russian bear’ (The Standard)
Regional countries stand to reap huge economic benefits if they can cooperate with the Russian Federation, an official has said. Newly appointed East Africa Community (EAC) Secretary General Peter Mathuki has emphasised the need to formalise cooperation between the regional body and the Russian government. Speaking at EAC headquarters in Arusha, Tanzania, yesterday, Dr Mathuki said the bloc is keen to identify areas of cooperation.
‘‘EAC is the fastest growing regional economic bloc in Africa. It is anchored on a clear vision with four pillars of integration: the customs union, the common market, the monetary union and ultimately the political federation,’’ Mathuki said.
DG Okonjo-Iweala underlines urgent need to address equitable access to vaccines (WTO)
At the General Council meeting, WTO members agreed to allow the Council for Trade-Related Aspects of Intellectual Property Rights (TRIPS) to continue consideration of the proposal first put forward by India and South Africa for a temporary waiver of certain TRIPS obligations in response to COVID-19.
“The way the WTO handles this matter is critical,” DG Okonjo-Iweala told members. “We need to have a sense of urgency on how we approach this issue of response to COVID-19 because the world is watching.” “Vaccine policy is economic policy because the global economic recovery cannot be sustained unless we find a way to get equitable access to vaccines, therapeutics, and diagnostics,” she added.
WTO calls for urgency in Covid-19 response; members await revised IP waiver proposal from India, South Africa (Business Today)
On a day when the United States declared its support to a temporary waiver of intellectual property (IP) protection on Covid-19 vaccines, Ngozi Okonjo-Iweala, Director General of World Trade Organisation (WTO) - the forum where India and South Africa proposed such a waiver in October 2020 - asked the member countries to have a sense of urgency on how they approach this issue of response to Covid-19.
Addressing the general council of WTO, where the issue of intellectual property and access to essential Covid-19 medicines and medical equipment was addressed, Okonjo-Iweala said she is happy to hear the proponents of the TRIPS waiver are putting together a revised text. “I think that it is incumbent on us to move quickly to put the revised text on the table but also to begin and undertake text-based negotiations. I am firmly convinced that once we can sit down with an actual text in front of us, we shall find a pragmatic way forward, acceptable to all sides that allow the kinds of answers that our developing country members are looking at with respect to vaccines, whilst at the same time looking at research and innovation and how to protect them,” she said.
COVID vaccine makers must relent on intellectual property rights and see to the world’s needs - The Boston Globe
Rosenblatt writes that “the system that gave us these shots depends entirely on strong intellectual property rights. These same protections will be critical when we face the next pandemic.” With the next pandemic, the world will be far safer when vaccines can be produced everywhere because the infrastructure will have been created. One of the lessons from the HIV and Ebola pandemics is that systems created then have enabled the Global South to quickly and effectively tamp down this pandemic.
In arguing against suspending intellectual property rights on COVID-19 vaccines, Dr. Michael Rosenblatt, an adviser to Moderna and the former chief medical officer of Merck, makes many misstatements. Contrary to Rosenblatt’s position on the issue, the United States should join the rest of the world in suspending patent rights to increase vaccine access. Pointing to the unspecified “billions” spent by industry as a justification for industry to retain patent rights, Rosenblatt neglects to mention the $17 billion spent by the National Institutes of Health on vaccine platforms and the more than $13 billion spent by the federal government’s Operation Warp Speed on COVID-specific vaccines, including all of Moderna’s research-and-development and clinical trial costs.
BREAKING - US Swings Weight Behind Global IP Waiver On COVID Vaccines; WTO Inches Towards ‘Text-Based’ Negotiations - Health Policy Watch
The United States has swung its weight behind a hotly-debated proposal by India and South Africa to suspend intellectual property rights on COVID-19 vaccines for the duration of the pandemic. The dramatic turnabout in the US position, announced Wednesday evening by US Trade Representative Katherine Tai, signals a sea change in the balance of powers around the debate over the IP waiver – which until now had been supported primarily by low- and middle-income countries.
The announcement came on the heels of a WTO General Council meeting where WTO members seemed to be inching towards more granular, and text-based negotiations over the proposal by South Africa and India to temporarily suspend intellectual property rights for needed COVID-19 treatments, tests and vaccines.
At Wednesday’s WTO General Council meeting, meanwhile, WTO Director General Ngozi Okonjo-Iweala welcomed news of South Africa’s and India’s plans to revise the original IP Waiver proposal, submitted in October 2020.
She urged all WTO members to advance to more nuanced talks over ways to ensure trade enables the scale up of needed COVID health products, as well as ensuring their freer and more equitable flow between countries.
Tai Says United States Will Back India-South Africa Proposal to Waive IP Rights Under TRIPS (IPWatchdog.com)
“[T]here are lots of reasons to believe that the ‘waiver’ is more good politics than anything else. Vaccinating the planet will still depend on exporting hundreds of millions, probably billions, of doses from the U.S., Europe and India, not on a loosening of any patent rights.” – Justin Hughes, LMU Loyola Law School
Bloomberg first reported today that U.S. Trade Representative Katherine Tai said that the United States will back a proposal by India and South Africa last year to waive intellectual property protections under the Trade-Related Aspects of Intellectual Property Rights (TRIPS) Agreement. The proposal calls for the suspension of international protections for patents, copyrights, industrial designs, trade secrets and proprietary materials, “in relation to the prevention, containment, or treatment of COVID-19 until widespread vaccination is in place globally and the majority of the world’s population has developed immunity.”
Tai reportedly said “We are for the waiver at the WTO, we are for what the proponents of the waiver are trying to accomplish, which is better access, more manufacturing capability, more shots in arms.”
US move on vaccine intellectual property is a ‘monumental moment’ in COVID-19 fight (Yahoo!)
“The commitment by (Joe Biden and US trade representative Katherine Tai) to support the waiver of IP protections on vaccines is a powerful example of United States leadership to address global health challenges.”
It is an issue that has become more urgent with the surge of cases in India, the world’s second-most populous country.
More than 100 countries support the proposal and Mr Biden had been under growing pressure from a group within Congress - all fellow Democrats who backed the waiver.
Those in favour of the move say it is already among the WTO’s tools and there is no better time to use it than during a pandemic that has killed 3.2 million people, infected more than 400 million more, and ruined economies around the world.
Vaccine IP waiver ‘could take months for WTO to negotiate’ (Thomson Reuters Foundation)
Ten meetings in seven months have failed https://www.reuters.com/article/trade-wto-vaccines-idINKBN2CM03C to move WTO members toward consensus on the original waiver proposal
Now that the U.S. Pres