tralac Daily News
According to Anglo American’s production report for the first quarter (Q1) of 2021, output rose for copper, platinum group metals (PGMs), iron ore and manganese. Global production for other commodities such as nickel and diamonds was down. But rising output for PGMs, iron ore and manganese is a boost for South Africa’s economy. Anglo said copper production for the three months to the end of March was up 7% on the same period last year. But for South Africa, rising production in three other key commodities is a positive sign for the wider economy.
Importation ban on poultry minimal (Government of Botswana)
The recent ban on the importation of domesticated birds and their products due to the outbreak of bird flu in South Africa has had a minimum impact on the local sub sector. In an interview on Wednesday, Feed Centre’s veterinarian, Dr Kgomotso Sitayelo explained that the poultry sector’s two sections of broilers and layers were not yet affected by the ban. “If the importation continues for some months that is when they could be affected,” he said. Dr Sitayelo highlighted the need to develop the local poultry industry for the country to become independent. “If we were independent the ban was not going to have an impact on our industry,” he added.
What SA’s red meat industry must fix before scaling up exports (Farmer’s Weekly)
Many South African red meat producers are keen to benefit from exporting some or all of their products to more profitable international markets. To do so, however, these farmers have to identify, and then consistently meet, a variety of requirements. For a start, a red meat exporter needs to know and understand the current state of South Africa’s red meat trade in fresh and frozen products, half and whole carcasses, and bone-in and deboned cuts. South Africa is a substantial net importer of mutton and lamb. Nonetheless, there is still an opportunity to increase its exports of sheep meat, as well as live sheep.
Stakeholders in the footwear and leather sector have committed themselves to transferring skills and rebuild capacity in order to fully transform. The commitment emanated from two site visits conducted by the Deputy Minister of Trade, Industry and Competition, Ms Nomalungelo Gina in KwaZulu-Natal to Planets Events Shoes and Neptun Boot today. Stakeholders committed and agreed to promote localisation, sourcing and buying local materials, transferring skills and working towards removing red tape that will hinder the future of the sector. Deputy Minister Gina said the ease of doing business locally must be prioritised so that it will be easy for investors to view the sector as lucrative.
Women’s and girl’s economic empowerment holds the key to Kenya realising a middle-income status by 2030, through industrialisation. Under Vision 2030, the government seeks to expand women access to financial services. Kenya being a signatory of the fifth Sustainable Development Goal (SDG 5), is mandated to empower women through investments. Tracking financial flows and impacts on gender-equity programmes are therefore imperative. But, the Covid-19 pandemic slammed brakes on donor funding, cutting billions of financial aid amid tough economic times. Therefore, reliable data on project funding and effectiveness is crucial.
Traders smuggle tonnes of Uganda maize into Kenya (Daily Monitor)
Last month, Kenya banned the importation of maize from Uganda, citing high content of aflatoxins and that it was unfit for human consumption due to risks of cancer. Subsequently, Kenya lifted the ban but imposed stringent measures to be adhered to by importers, traders and farmers from either countries. Among the measures included registration of all importers in Kenya, issuance of certificates to all Ugandan grain traders and their stores certified, and provision of certificates of origin of the cereals. Traders now claim that because of such measures they have resorted to smuggling maize across the border.
Case against pipeline project delays in Arusha (The East African)
A case seeking to stop construction of the oil pipeline from Uganda to Tanzania for failing to conduct an environmental and social impact assessment has failed to take off even as the two countries proceed with implementation of the project. On April 11, President Yoweri Museveni of Uganda and his Tanzania counterpart President Samia Suluhu signed a deal for the $3.5 billion East African Crude Oil Pipeline (EACOP), now touted as a strategic win for Tanzania which will earn $12.7 off each barrel of oil transported through it.
President Samia outlines stimulus plan (The Citizen)
President Samia Suluhu Hassan yesterday outlined a raft of measures her government will take to stimulate economic growth, which has been adversely affected by the global Covid-19 pandemic. President Hassan – who assumed the presidency on March 19 following the death of her predecessor, Dr John Magufuli, on March 17 – spent almost a third of her 90-minute maiden speech to Parliament articulating what the government would do to regain investor confidence. She also explained how economic diplomacy, provision of incentives to strategic projects, fighting corruption and getting rid of bureaucracy in issuance of work permits and approval of investment projects, among others, would boost investment to spur economic growth to at least eight percent annually.
Nigeria’s trade deficit rises 49% to $2.5bn (Vanguard)
The nation’s trade deficit rose month-on-month by 49 percent to $2.5 billion in January from $1.69 billion in December last year even as foreign trade stood at $8.14 billion during the period. Also capital importation dropped by 31 percent to $380 million in January from $550 million in December 2020. However, aggregate external trade improved marginally by 3.2 per cent during the period. These were contained in the Central Bank of Nigeria, CBN, Economic Report for January, 2021.
Customs Realises N446.1 Billion Revenue in Q1 2021 (Investors King)
The Nigeria Customs Service (NCS) realised N466.1 billion in revenue in the first quarter (Q1) of 2021, according to the latest data from the Public Relations Officer, NCS, Mr. Joseph Attah. The data showed NCS realised N157.6 billion in January; N138.9 billion in February and N169.4 billion in March 2021. A further breakdown showed the agency generated N216.9 billion of the total amount from import duty, while N105.2 billion was realised as Customs VAT and N55.5 billion was generated as a non-federation accounts levies.
Stakeholders at the launch of a report assessing Ghana’s competitiveness and available opportunities for the country under the African Continental Free Trade Area (AfCFTA) have blamed the continued lending by some local banks to government as well as the high treasury bill rates, for the low level of credit advanced by financial institutions to the private sector. They thus advised authorities to ensure that the interest rates come down to enable private sector companies who may want to assess credit facilities to do so effortlessly to stay competitive. The advice was given following a report commissioned by the Business Sector Advocacy Challenge Fund (BUSAC Fund) and conducted by consultants from research and advisory firm, Konfidants.
Cameroon is the United Kingdom’s 120th largest trading partner,[footnote 2] accounting for less than 0.1% of total trade. Total trade in goods and services between the United Kingdom and Cameroon was £200 million in 2019. HM Government expects the United Kingdom-Cameroon EPA to support jobs and economic development in Cameroon by providing continuity in trading arrangements with the United Kingdom including duty free and quota free market access. This could be of benefit to partner firms producing goods for which the United Kingdom is an important export market and of benefit to consumers through lower prices.
The Libyan economy faces major challenges, including recurring disruptions to the oil and gas sector, the fragmentation of state institutions, and ongoing conflict. The new spring 2021 edition of the Libya Economic Monitor details how, for most of 2020, the performance of the Libyan economy was the worst in recent record. A 9-month blockade that began in January 2020 cut the country’s crude oil to less than one-sixth of 2019 values – the worst monthly performance since the beginning of the recent conflict. “Libya faces enormous economic challenges and desperately needs unified institutions, good governance, strong political will, and long overdue reforms,” said Jesko Hentschel, World Bank Country Director for the Maghreb and Malta.
The Ministry of Economy, Finance, and Development and its partner the African Development Bank (AfDB) are holding a high-level meeting this Monday, April 19th, 2021, in Ouagadougou. This multi-day meeting, which is being held face-to-face and by video conference, aims to develop the new 2022-2026 Country Strategy Paper (CSP). It will also discuss the combined completion report for the 2017-2021 CSP. The 2017-2021 Country Strategy Paper is at the end of its implementation. It has served as a framework for cooperation between the African Development Bank (AfDB) and Burkina Faso, through its Ministry of Economy, Finance, and Development.
African regional and continental news
African Continental Free Trade Area (AfCFTA)
Africa’s policymakers need to ensure that the momentum behind the African Continental Free-trade Area (AfCFTA) is not lost following the trading bloc’s launch in January. This initiative could act as the much-needed stimulus for the continent’s economies in the wake of the COVID-19 crisis. In our view, the East African Community – which has had good traction in terms of regional trade integration – clearly demonstrates the benefits that AfCFTA could bring to the continent as a whole. Thanks in part to their reduced reliance on offshore markets, East African nations including Tanzania and Ethiopia evaded a recession in 2020 despite the pandemic, according to IMF data. Regional powerhouse, Kenya contracted marginally last year and is expected to grow by 7.6% in 2021 and 5.7% in 2022.
How Africa Should Approach Trade and Industrialization (Project Syndicate)
Tariffs are not the main impediment to continental trade, faster industrialization, and structural transformation in Africa. In fact, trade tariffs are already low. Thus, much emphasis is placed on addressing non-tariff barriers, particularly infrastructure gaps and customs-related transaction costs. AfCFTA-linked steps to streamline customs procedures and curb rent-seeking at borders will go some way toward boosting efficiency. But what is really needed is large-scale investment in physical customs infrastructure and modernization of information-technology systems. The continent’s real problem is its underdeveloped production capacity.
The Africa Continental Free Trade Area (AfCFTA) agreement came into effect on the January 1 this year. The free trade agreement should also have significantly positive consequences for SMMEs throughout Africa, in that it will help to create a solid platform for smaller businesses to participate in, and benefit from, heightened intra-continental trade. Of course, the full implementation of AfCFTA is likely to take many years and will require the full buy-in and support of businesses and governments across Africa. There are a number of key components that need to fall into place in order to create the momentum needed to successfully implement the free trade area in the coming years.
The chairman of Mota-Engil Africa, Manuel Mota, said on Thursday that the free trade agreement in Africa is fundamental for the development of the continent, as it fosters regional integration, which is fundamental for economic development. “The free trade agreement in Africa is key to developing economies, because the easiest way to grow is to grow together, similar to what was done in Europe, with the European Union, and in Africa they are trying to do the same,” said the leader of the Portuguese construction company during the Portugal-Africa business seminar “Exporting ‘Green’ – Internationalisation of companies in the era of sustainability,” organised by the Portuguese presidency of the Council of the European Union, which is being held today in virtual format from Lisbon.
Constrained global financial conditions caused by Covid-19 have led to massive portfolio outflows from Africa, exceeding $5 billion in the first quarter of 2020, a new continent-wide survey on trade finance has shown. About $3.1 billion left the South African market alone, the report found. Launched on 15 April 2021, the African Trade Finance Survey Report examines how trade finance has evolved during the Covid-19 pandemic and highlights the role it can play in overcoming the social and economic fallout of the disease. The survey was conducted by African Export-Import Bank (Afreximbank) jointly with the UN Economic Commission for Africa and the African Development Bank-hosted Making Finance Work for Africa Partnership.
In a time where employment opportunities in the semi-skilled sector are limited, informal cross border trade has become the go-to economic activity for thousands of Malawians, particularly women, looking to generate income. Informal cross border traders travel to countries such as South Africa, Zambia, Zimbabwe and Tanzania and return with various goods including food, clothes, business utensils and stationery amongst many others. These activities have been largely affected over the last year due to travel and trade regulations implement as a result of the pandemic, felt even more greatly by women in the sector. The Cross Border Traders Association of Malawi (CBTAM) is a civil society organization which works to strengthen, promote and protect Malawian cross border traders by improving the trade conditions as well as protect the rights of informal and formal trade businesses.
African Countries and telecommunications stakeholders have today launched the first set of ATU spectrum recommendations that focus on transforming Africa into a knowledge economy through the development of technologies that boost connectivity and innovation. The launched spectrum recommendations outline the importance of awarding the radio spectrum in countries across Africa in a timely, predictable and cost-effective fashion so as to support affordable, high-quality delivery of Information and Communications Technology (ICT) services and spur smart technology initiatives. The recommendations also establish the idea that licensing should be technology-neutral and allow for service innovations.
The Economic Commission for Africa (ECA) and its partners on Thursday launched a friendlier and comprehensive “Learning Girls in ICT Initiative” that is expected to help bridge the continental digital divide. The launch of the “Learning Girls in ICT Initiative” marked the 10th anniversary of the International Day of Girls in ICT which is commemorated annually on 22 April to help bridge the gender digital divide. “Digital skills offer our girls the power to change the world,” Jean-Paul Adam, the Director of the ECA’s Technology, Climate Change and Natural Resources Division (TCND), said. “Digitalization offers a variety of opportunities for female empowerment and a more equal female participation in labor markets, financial markets, and entrepreneurship.”
The food production equation has recently become even more complex with the emergence of Covid-19, which to date threatens human movement, crippling the distribution of essential agricultural inputs such as seeds, fertilisers and farm chemicals. With smart technologies and timely climate information, however, farmers can effectively minimise the impacts of these challenges as well as enhance yields and income. A slow-down in production, he says, is a precursor to food insecurity and high commodity prices. “Coronavirus is just an example of what sort of disruption we can suffer in the future. “The immediate disruption was on farmers accessing inputs, market, extension and training. We, therefore, need several interventions among them service centres which have services closer to farmers,” he says.
The World Health Organization (WHO) has urged African countries not to destroy Covid-19 vaccines that may have passed their expiry date. Countries have been told to keep hold of them and wait for further guidance. The appeal comes after Malawi and South Sudan said they would destroy more than 70,000 doses of the Oxford-AstraZeneca jab because they expired in mid-April. But the Africa Centres for Disease Control (Africa CDC) said it had been assured the doses were safe to use.
WHO warns Africa not to let its guard down amid pandemic (Engineering News)
The World Health Organisation (WHO) Regional Director for Africa Dr Matshidiso Moeti has encouraged African countries to sustain Covid-19 prevention measures and urged countries not to let their guards down as the world races to vaccinate their populations. Moeti said on Thursday that despite the challenges and stories circulating about the vaccine, people must have confidence in the WHO guidance.
The demand comes with concerns rapidly growing about the number of new variants of the Coronavirus in Africa. Experts believe the emergence of new Coronavirus variants in Africa have contributed to an increase in both cases and deaths reported in many countries on the continent. Speaking earlier this week at a special event in the European parliament on EU-Africa relations, Belgian MEP Assita Kanko said the European Commission should do more to support local authorities and local initiatives that can help mitigate the impact of COVID-19 in African countries.
America has been a longstanding partner to Africa’s nations and its people, leading in aid and development assistance, healthcare, and the fight against transnational terrorism. But Africa is more than conflict and poverty – it represents important opportunities in trade and investment, and many of the world’s major economies recognize this fact. Many African countries are rapidly enhancing integration into global capital markets and innovating and developing sizable domestic markets. The continent, with a population in excess of 1.3 billion people, a median age under 20 years old, and a landmass large enough to fit Europe, the lower 48 United States, China, and India, includes several of the world’s fastest growing economies. The United States sees strengthening US-Africa economic ties as a priority.
China In Africa: Implications For Australia (FN Arena News)
Recently The Economist held a webinar ‘Africa-China Relations: new frontiers of co-operation?’ As China continues its rapid economic growth and builds the influence that comes with such clout, it can find in Africa not only an opportunity to enhance trade ties, but also diversify its import sources. In an era in which Australian-Chinese relations are at the lowest they’ve been in decades, Australia now needs to prepare for years ahead where Beijing may find in Africa an opportunity to shore up strength at home while diminishing existing trade ties with Australia.
In what could be a dramatic shift in how the White House views Africa, President Joe Biden invited five leaders from sub-Saharan Africa to today’s virtual Summit on Climate. That’s a good start for the new administration if it seeks to treat Africa as a partner. But the U.S. has a long way to go to catch up to years of China’s unrivaled pursuit of the continent. Over the last few years, American policymakers have become increasingly alarmed over China’s deep engagement with the developing world. In many ways, Africa was the frontier of this trend. From weak engagement in the 1990s, China has become Africa’s largest trading partner. By 2019, China was financing one in five African infrastructure projects and constructing one in three.
Global economy news
LDCs’ economies have been hit hard by the COVID-19 crisis, according to a presentation by the WTO Secretariat, which highlighted a 10.3 per cent decline in exports of merchandise trade in 2020 compared to 2019 and a 10.5 per cent decline in imports. This is sharper than the global 7.7 per cent decline in exports and 7.8 per cent decline in imports over the same period. Due to their dependence on travel exports, LDC exports of services are estimated to have dropped around 40 per cent in the first three quarters of 2020, double the decline experienced by the rest of the world (19 per cent). The ongoing crisis has revealed the importance of building LDCs’ trade infrastructure and strengthening their capacities to keep the pandemic in check and better integrate into the world economy, Chad said, on behalf of the LDC Group.
TRIPS meet: India, S Africa to rework patent proposal (Times of India)
The European Union (EU), the UK and Switzerland on Thursday refused to support talks for easing patent rules for vaccines, although World Trade Organization (WTO) members did recognise serious challenges being faced in production and distribution of Covid products, including vaccines. During a meeting of the TRIPS Council, which is discussing India and South Africa’s joint proposal for flexibility in the patent regime to facilitate access to vaccines in poorer countries, especially Africa, the Indian delegation made it clear that the existing approach of voluntary licences could only deliver vaccines to 4% of the global population, sources familiar with the deliberations told TOI.
The U.S., Canada and U.K. are among some of the high-income countries actively blocking a patent-waiver proposal designed to boost the global production of Covid-19 vaccines. It comes as coronavirus cases worldwide surge to their highest level so far and the World Health Organization has repeatedly admonished a “shocking imbalance” in the distribution of vaccines amid the pandemic. The landmark proposal, which was jointly submitted by India and South Africa in October, has been backed by more than 100 mostly developing countries. It aims to facilitate the manufacture of treatments locally and boost the global vaccination campaign.
When the Ever Given megaship blocked traffic in the Suez Canal for almost a week in March, it triggered a new surge in container spot freight rates, which had finally started to settle from the all-time highs reached during the COVID-19 pandemic. Container rates have a particular impact on global trade, since almost all manufactured goods – including clothes, medicines and processed food products – are shipped in containers. “The ripples will hit most consumers,” Mr. Hoffmann said. “Many businesses won’t be able to bear the brunt of the higher rates and will pass them on to their customers.” A new UNCTAD policy brief examines why freight rates surged during the pandemic and what must be done to avoid a similar situation in the future.
African Development Bank President Dr. Akinwumi A. Adesina on Thursday joined 40 heads of state and government at the Leaders Summit on Climate, where the United States, Japan and Canada announced ambitious climate targets to address the escalating emergency. During a panel discussion titled “Financing the 10-year Sprint,” Adesina spelled out the challenge that confronts the African continent as the climate crisis worsens and the world races to meet the 2030 deadline for the 17 United Nations Sustainable Development Goals. “The continent loses $7 billion to $15 billion a year to climate change, and this will rise to $50 billion per year by 2040, according to the IMF. Africa is not at net zero. Africa is at ground zero. We must therefore give Africa a lift to get a chance of adapting to what it did not cause.”
In the wake of COVID-19, most governments face unprecedented unemployment. This is particularly challenging in developing economies, which lack robust social safety nets and where unemployment and poverty were pronounced before the pandemic. This situation can potentially hasten ‘brain drain’ and increase the appeal of joining extremist groups. Between May and August 2020, we undertook a study to explore ways to address these government shortcomings. It examined interventions to stimulate entrepreneurship in frontier and emerging markets with the concept of “entrepreneurial communities” at the centre (an expansion of Brad Feld’s thinking on startup communities in the US).
The International Air Transport Association (IATA) expects net airline industry losses of $47.7 billion in 2021 (net profit margin of -10.4%). “This crisis is longer and deeper than anyone could have expected. Losses will be reduced from 2020, but the pain of the crisis increases. There is optimism in domestic markets where aviation’s hallmark resilience is demonstrated by rebounds in markets without internal travel restrictions. Government imposed travel restrictions, however, continue to dampen the strong underlying demand for international travel. Despite an estimated 2.4 billion people travelling by air in 2021, airlines will burn through a further $81 billion of cash,” said Willie Walsh, IATA’s Director General.
Resilience Needed to Jump Start Final Stages of Energy Transition (Modern Diplomacy)
As countries continue their progress in transitioning to clean energy, it is critical to root the transition in economic, political and social practices to ensure progress is irreversible, according to the latest edition of World Economic Forum’s Fostering Effective Energy Transition 2021 report published today. In its 10th edition, the report, published in collaboration with Accenture, draws on insights from the Energy Transition Index (ETI) 2021. The index benchmarks 115 countries on the current performance of their energy systems across the three dimensions of the energy triangle: economic development and growth, environmental sustainability, and energy security and access indicators – and their readiness to transition to secure, sustainable, affordable, and inclusive energy systems.