tralac Daily News
The Economic Reconstruction and Recovery Plan (ERRP) announced last year prioritises infrastructure spending to support the economy in the short term and longer-term reforms tended to boost the potential growth rate, but it needs a coherent funding mechanism. The ERRP sets out eight priority interventions that will ignite South Africa’s recovery and reconstruction effort, with an emphasis on infrastructure as the main driver of the endeavour. The ERRP intends to unlock more than R1 trillion in new infrastructure investments through enabling the private sector, building capability in Infrastructure SA and the Infrastructure Fund, reviewing procurement frameworks, and providing catalytic funding through blended finance instruments. To boost infrastructure spending, the government plans to partner with the private sector, multilateral development banks, and development finance institutions to augment its skills, expertise and funding.
Illegal trade grips industry (News24)
Government’s 8% increase in sin tax on legal alcohol and cigarettes has resulted in growth in illicit trade competitiveness. Illegal trade is estimated to have grown to 15% of the South African alcohol industry. This is according to findings by ALCO-Safe, supplier of electronic breath alcohol detectors and drug detection equipment and accessories in the country. The rapid growth is blamed on Covid-19 lockdown regulations and consumers not being able to afford legal alcohol products. Part of the findings made is that liquor traders upped their prices due to lockdown, to recover costs, and illicit traders capitalised. “The illicit market cost tax collectors R6,4 billion under various bans or restrictions as part of the state’s Covid-19 response,” said Rhys Evans, managing director of ALCO-Safe.
Committee on Trade and Industry Calls on Stakeholders Within Sugar Industry to Diversify Their Products (Parliament of South Africa)
The Portfolio Committee on Trade and Industry heard yesterday from the engagement it had virtually with the stakeholders within the sugar industry that the South African sugar cane Industry has experienced a sharp decline in revenue in recent years, which is a result of mainly the cheap sugar imports that flooded the local sugar market and the Health Promotion Levy (HPL) that is threatening its future prospects. A range of sugar industry’s key stakeholders presented their progress towards their implementation of the Sugar Cane Value Chain Master Plan. They all commended the government for its timely intervention in bringing about long-lasting plans meant to sustain the industry by harnessing the competitiveness of its value chain.
Deputy President David Mabuza says in order for South Africa not to be excluded from procuring COVID-19 vaccines, it had no choice but to accept full liability for the vaccines acquired. This means that government had to accept conditions that COVID-19 manufacturers imposed on countries of the world, including accepting full liability in an event that vaccines had side effects, or risk being excluded from receiving vaccines from manufactures.
What SA agriculture needs from international trade (Farmers Review Africa)
Agriculture is a pivotal industry. It is not only crucial in providing food security worldwide, but it’s also the main source of jobs and livelihoods on our continent. Yet, despite its potential to feed the growing global population, Africa remains home to more than half of all the people in the world who face food insecurity. How, then, do we unlock the potential of our continent to produce the quantity and quality of food it is capable of? I believe that international trade is a critical part of the answer. Farmers (Producers) further need the cost of doing business across borders to come down. Sub-Saharan Africa has the highest export and second highest import costs in the world, and the myriad registration and licencing systems across the continent severely limit the profitability of intra-continental trade.
The National Liquor Traders Council has warned its members not to drop their guard against COVID-19 as the number of infections in South Africa shows a worrying upward trend. The council said that it had been working with the liquor industry to drive maximum compliance with COVID-19 safety protocols among taverns and their patrons. “We warn our members not to drop their guard against COVID-19 and continue to enforce mask-wearing, social distancing and proper hygiene in their outlets. It would really be a tragedy if we let the third wave to take hold as a result of complacency,” he said.
Public debt relief helps cut Kenya payments by Sh78bn (Business Daily)
Kenya projects savings of up to Sh78.17 billion after it signed debt repayment moratoriums with several rich countries, lifting pressure on its thinned domestic revenue collection. The National Treasury estimates that deferred repayments for loan principals will amount to Sh42.23 billion in the current financial year ending June while reliefs on interest payments would hit Sh35.94 billion. Haron Sirima, the director-general for public debt management at the Treasury, said a variation in the strength of the shilling also helped to boost the size of savings.
Fragmented services and manual procedures created loopholes and opportunities for cartels that processed fake licenses and motor vehicle logbooks, contributing to a thriving underground economy that exposed banks and insurance firms to potential fraud and losses. That was before the Kenyan government established the semi-autonomous National Transport and Safety Authority (NTSA) to harmonize the operations of key road transport departments and manage road safety. To manage essential transport services, the NTSA launched the Transport Integrated Management System (TIMS) electronic data platform in 2016. “TIMS has made our work easier,” said Richard Kanoru, the Secretary General of the Matatu Transport Vehicles Association. “At a click of a button and within five minutes, an operator can apply for all the necessary licenses to operate a Matatu. Our business costs have come down significantly because we don’t need intermediaries to get services from NTSA.”
Dar reaps big on cargo at Mombasa’s expense (The East African)
The port of Dar es Salaam benefitted from the minimal Covid-19 containment measures in Tanzania to record a higher cargo throughput in the past year. Transporters in the Central Corridor enjoyed lower costs of transport compared with those on the Northern Corridor. This is attributed to less Covid restriction-induced delays at border crossings. According to the latest shippers’ report, The Impact of Covid-19 on transport and logistics sector in East Africa”, Dar es Salaam port saw 4,939 metric tonnes more cargo throughput during Covid-19 pandemic peak time between March 2020 and March 2021 compared with a four percent cargo decline at the port of Mombasa. During the period in review, road freight rates on the Northern Corridor from Mombasa to Kampala increased from $2,200 to $2,500 for a 20/40-foot container and rates to Kigali from Mombasa increased from $3,400 to $3,800. It also took 14 to 16 days to move the cargo between the two points, up from the pre-pandemic duration of seven to nine days.
Joy as ban on Ugandan maize is lifted (Daily Monitor)
There is a sigh of relief among traders after Kenya lifted the ban on importation of maize. More than 100 trucks carrying about 1,200 tonnes of maize from Busia, Uganda, spontaneously crossed into Kenya on Monday. The lift marks the resumption of the multibillion trade between Uganda and Kenya, a major trading partner on the East African bloc. The Agriculture and Food Authority (AFA) of Kenya on March 5 banned the importation of maize from Uganda and Tanzania over safety standards, saying the cereal had aflatoxins and posed a health risk to consumers. Mr Joseph Emodo, a Kenyan national, told Daily Monitor that many Kenyans are now assured of food security. Mr Elidad Murungi, a clearing agent on the Kenyan side of the border, said he was happy that maize trading had resumed.
Museveni promises 10% economic growth when oil production starts (Daily Monitor)
President Yoweri Museveni Wednesday expressed optimism that Uganda’s economy will grow in the range of 9- 10 per cent when the country starts commercial production. Speaking at Kololo ceremonial grounds after swearing in for the sixth elective term, Mr Museveni said: “With the activation of the oil sector, which has been dormant ever since 2006 when we discovered the petroleum and if you add the expected average growth rate of 6 per cent per annum post Covid-19, the combination will expand the economy to an estimated $67 billion by 2026 using the exchange rate method and $193 billion using the PPP method; meaning that the economy will be growing at the rate of between 9-10 percent in the initial years of oil production.”
Accredited laboratories to boost manufacturing, export – SON (The Sun Nigeria)
The Standards Organisation of Nigeria (SON) is optimistic that its newly accredited laboratories will boost the nation’s manufacturing industry and increase the level of export of locally made goods to the international market. According to Director General, Mallam Farouk Salim, the accredited labs would encourage manufacturers produce more, saying that products certified and tested in the labs would receive global acceptance anywhere in the world. “You hear most of our manufacturers say that their products were rejected even by our local companies because their products are not certified. They do not have laboratory certificate to show they are up to standard, but now, that excuse is out of the way. Also, because of the export potentials of our industries, with the certification, it is easy for them to export anywhere in the world because an accredited laboratory means that whatever we say is good, is good.”
US$ 12.9bn investment slated for rail expansion projects in Ghana (Construction Review)
The Nana Akufo-Addo led government intends to invest US$ 12.9bn in a rail network expansion projects in Ghana in a bid to make this mode of transport one of the fundamental channels of mobility across the West African country. This plan whose financing will come largely from private investors is linked to a national rail transport strategy connected with 13 other projects that have been born within the framework of the United Nations Sustainable Development Goals (SDGs) and the African Union’s Agenda 2063. According to the roadmap drawn up, approximately US$ 5.8bn of this investment will go towards a project to develop a light rail network (LRT) comprising seven corridors in Kumasi, the capital city of the Ashanti Region.
The Ghana Export Promotion Authority has launched a technology-driven export trade information centre to serve as a one-stop shop for up-to-date export related information for the exporter community. Dubbed the GEPA Impact Hub, the centre would provide value-added services to exporters in a bid to meet the ultimate goal of the National Export Development Strategy, which is to attain US$25.3 billion in Non-Traditional Export earnings by 2029. The GEPA Impact Hub is an IT-enabled hub with computers, online resources and a library located at the Africa Trade House where clients can access export-related information. Mr Kyerematen said exports were key to the industrialization agenda if Ghana would succeed and develop, adding that it was important for all stakeholders to pursue and achieve the NEDs goal and target of $25.3 billion in 2029.
Ethiopia makes U-turn on blocking M-Pesa bid (Business Daily)
Ethiopia Wednesday made a U-turn and allowed foreign telecommunications companies to launch mobile phone-based financial services, setting the stage for Safaricom to introduce its popular M-Pesa in the market of 110 million people. Ethiopian Prime Minister Abiy Ahmed said the mobile financial services in the country will be opened to competition from next May, with foreign firms free to battle with State-run Ethio Telecom. This marks a departure from last year’s directive that only allowed locally-owned non-financial institutions to offer mobile money service, dimming the hopes of foreign firms like Safaricom that are seeking a presence in Kenya’s neighbouring country. The prime minister said, however, that mobile financial services would be opened up to competition after a year of telebirr operations. The move would offer Safaricom a path to roll out M-Pesa in Ethiopia’s nascent telecoms sector considered one of the most lucrative in the economy as the once inward-looking country opens up to foreign investment for the first time.
Ethiopia’s state-owned Ethio-Telecom on Tuesday evening launched a Chinese-developed mobile money service solution. The launch of the Ethio-Telecom’s mobile money service solution, called “Tele-Birr”, was attended by high level Ethiopian government officials including Prime Minister Abiy Ahmed as well as various foreign dignitaries. The “Tele-Birr” mobile money service solution which took five months to develop and complete was undertaken by Chinese hi-tech giant Huawei.
The Republic of Guinea becomes the seventh (7th) Member State to deposit the instrument of ratification of the African Medicines Agency (AMA). AMA will be the second specialized continental health agency after the Africa Centres for Disease Control and Prevention (Africa CDC) that will enhance capacity of State Parties and AU recognized Regional Economic Communities (RECs), to regulate medical products in order to improve access to quality, safe and efficacious medical products on the continent. In the face of a looming pandemic, the necessity of AMA has been amplified and particularly its function in coordinating joint reviews of applications for the conducting of clinical trials and providing technical support in quality control of drugs at the request of Member States which do not have the structures to carry out these examinations/controls/checks.
Following approval of the proposal by the Boards of Directors of the African Development Bank Group to clear about $413 million in arrears on loans owed by Sudan, the Bank Group has completed the arrears clearance process, enabling the East African country to have immediate access to new financing. The clearance of Sudan’s arrears was made possible with the support of the United Kingdom government through bridge financing of GBP148 million to clear Sudan’s arrears to the African Development Fund. Consequently, the African Development Bank Group sanctions on Sudan have been lifted and a policy-based operation is being provided to the country as part of the Bank’s full re-engagement with Sudan to complement its ongoing operations. Clearing of arrears with international financial institutions such as the African Development Bank, the World Bank and the International Monetary Fund, is one of the preconditions for Sudan under the Highly Indebted Poor Countries (HIPC) Initiative, which is paramount for clearing other debt owed to the Paris and Non-Paris Club creditors.
China and Tanzania on Wednesday signed an agreement on economic and technical cooperation to enhance bilateral friendship. The agreement was signed in the commercial capital Dar es Salaam by Chinese Ambassador to Tanzania Wang Ke and Permanent Secretary of Ministry of Finance and Planning Emmanuel Tutuba on behalf of the two governments. According to the agreement, the Chinese government will provide new gratis aid for Tanzanian mainland, which will be utilized in the construction of projects negotiated and approved by the two governments.
When the COVID-19 (coronavirus) pandemic began, businessowner Omer Abdelaziz had no clear idea about the duration of the government’s imposed lockdown. As co-owner and director of the International Development Center for Training and Capacity Building, he simply complied fully with the government’s decision, suspending all activities. But the pandemic and the country’s restrictions went on longer than expected. “As a management team, we made a mistake in our forecasts about how long the crisis will last,” said Abdelaziz, co-owner and Director of the International Development Center for Training and Capacity Building. “We decided still to keep the center and not to close it permanently, bearing its high running cost without having any cash inflows.”
Cameroon fintech secures $3-million (Ventureburn)
Douala-based fintech company Maviance PLC has secured $3-million in a seed investment round led by MFS Africa, the pan-African digital payments hub. The fintech company will use the funding to increase its presence in Cameroon and expand its business model into other countries in the central African economic region (CEMAC). Dare Okoudjou, CEO and founder of MFS Africa comments on the investment made into the fintech. “The rapid development of digital financial services that we have seen in Cameroon over the past few years is poised to spread across the CEMAC region. This will further accelerate the demand for domestic and cross-border payments from MSMEs, social enterprises, and corporates in the region. Maviance, as a key infrastructure provider with its set of highly relevant products, is well-positioned to benefit from this growing demand. That is why we are thrilled to be partnering with the company, as we continue to broaden and deepen the reach of the MFS Africa Hub across Africa.”
African regional and continental news
AfCFTA potential benefits to SMEs, women (Namibian)
Many African small and medium enterprises (SMEs) and women-led business, who are struggling with capital and high production costs in countries like Namibia, will find it hard to export within Africa given the high tariffs. According to the African Trade Policy Centre (ATPC), SMEs are key to growth in Africa, accounting for around 80% of the region’s businesses. However, they struggle to penetrate advanced overseas markets, but are well positioned to tap into regional export destinations using regional markets as stepping stones for expanding into overseas markets once the AfCFTA is fully implemented, the ATPC stated.
NCDMB to host African Local Content Roundtable in Yenagoa (Vanguard News)
The maiden edition of African Local Content Roundtable has been scheduled to hold in Yenagoa, the Bayelsa State capital, on 3rd and 4th of June, 2021. According to the organizers, “critical stakeholders in the oil and gas sector in Africa have been fascinated by the remarkable impact and achievements of Nigeria in the implementation of the Nigerian Oil and Gas Industry Content Development (NOGICD) Act and the development of its hydrocarbon resources which is anchored on the philosophy of In-Country Value Addition. African countries such as Uganda, Ghana, Niger Republic, Congo have at various times undertook a study tour to institutions in Nigeria, to understand the Nigerian Content delivery model, with some of the countries signing their own local content laws or policies based on insights from Nigeria.
EAC to provide hotline for cross-border traders to report challenges (The East African)
The East African Community will have a hotline through which traders crossing partner states borders can register their challenges and get prompt feedback, the secretary general has said. “There is need to resolve persistent Non-Tariff Barriers (NTBs) and reduce time spent in the movement of goods and persons, hence increasing intra EAC trade, which currently stands at 15 percent,” said Dr Peter Mathuki on Monday when he visited Kenya-Tanzania border at Namanga.”This emergency number will be set up for feedback and follow-up on trade issues, and we hope it will provide an avenue for traders to register their challenges.” He affirmed that the movement of goods and persons at the Namanga One Stop Border Post (OSBP) and truck traffic impasse has cleared following the directive given by Kenya’s President Uhuru Kenyatta last week, when his Tanzanian counterpart Samia Suluhu Hasan visited Nairobi.
Ivorian President Alassane Ouattara (photo) was the guest of a virtual debate organized on the occasion of the 60th anniversary of the Africa Department of the International Monetary Fund (IMF) last May 10. During his speech, the former official of the Bretton Woods institution made a strong plea for an in-depth reform, and an improvement of the measures taken to help African countries get out of the Covid-19 crisis. According to the Ivorian head of state, African countries need the necessary fiscal space to finance their economic recovery processes. In this regard, he asked the IMF to be flexible regarding the rate of public deficit required of African states wishing to benefit from financing from the institution. “The deficit-to-GDP ratio is 9% in the USA and nearly 8% in France. Germany, which has always been a surplus country, will this year record a deficit of 6%. However, in the context of our trade, African countries are required to be at 4%. This is impossible,” he said.
In 2020, the largest trade partner for Africa was the EU with 28 % of both exports and imports. In exports it was followed by other African countries (23 %) and China (8 %). For imports these two had switched places, China (16 %) was second and other African countries (13 %) were third. In 2010, EU imports from Africa were smaller than exports to Africa resulting in a trade deficit of EUR 7 billion (see Figure 2). This grew to EUR 25 billion in 2012. Between 2012 and 2016 imports from Africa decreased significantly and the trade deficit became a trade surplus of EUR 33 billion. This surplus fell to EUR 8 billion in 2018 and 2019. In 2020, due to the COVID-19 pandemic, exports fell by EUR 20 billion while imports fell by EUR 35 billion. Thus the trade surplus grew to EUR 23 billion. Findings: Primary goods dominate imports with Africa; Northern Africa largest trade in goods partner; Manufactured goods dominate exports to Africa
International treaties are complicated enough when they are negotiated between two or three states. They become even more complex when 106 countries at once try to defend their individual interests and power claims and regulate them in a legally binding way. It is therefore hardly surprising that the negotiations on a new basic agreement between the 27 European Union (EU) member states and the 79 countries of the Organization of African, Caribbean, and Pacific States (OACPS, formerly ACP) dragged on for more than three years before a breakthrough was finally announced in mid-April. Inevitably, not everyone affected by the deal – dubbed “Cotonou 2.0” or “post-Cotonou” in reference to the previous agreement – was happy with the results. Unlike in the Cotonou Agreement of 2000, the new deal includes a so-called “three-plus-one structure” intended to take into greater account the individual needs of the three partner regions. But Maré is skeptical: “We hope that that will happen, but sometimes the devil is in the details.”
President von der Leyen has called for the creation of “an African Green Deal for a stronger and more prosperous Africa”. But the scope of the EU’s proposed carbon levy on imports, the Carbon Border Adjustment Mechanism (CBAM), has caused some disquiet among African officials who worry that a continent that only accounts for 2% of the world’s carbon emissions will end up being hit by a tax designed to target China and other high emitting countries. AU officials say that establishing green value chains in Africa will take decades to reach. And the continent’s aid-dependent countries are concerned about the EU’s plans to attach new conditions to aid, by specifying that 25% of aid money must be spent on projects related to climate action. “Africa is a huge market offering incredible opportunities. The recovery pathway offers enormous opportunities. Recovery must be green and build climate resilience. Recovery must boost green investments,” Adesina said.
After two and half years of intense negotiations, a successor to the Cotonou Agreement is in sight. On 15 April, we as chief negotiators concluded the negotiations that will lead to the signing of a new association agreement between the 79 members of the Organisation of African, Caribbean and Pacific States (OACPS) and the European Union (EU). We are proud of what we have achieved together. This agreement renews, modernises and deepens the special relationship the African, Caribbean and Pacific states and the European Union have built over more than 40 years. It sets a framework for our cooperation in the next 20 years. Together, we represent 1.5 billion people on four continents, 106 countries, and more than half of the seats at the United Nations’ General Assembly. We choose to work together. The new agreement takes our partnership to the next level. It is more ambitious, comprehensive and flexible than its predecessors, be it in terms of jobs, global challenges, rights, multilateralism and differentiation. It really goes beyond the Cotonou Agreement, in various fields. Let us raise just three of these aspects.
The 2021 edition of the Africa Dialogue Series (ADS), the Office of the Special Adviser on Africa (OSAA)’s flagship event, will take place throughout May, which is also Africa month, and will be a celebration of the continent’s identity, culture, history and achievements. It will also bring together key stakeholders to discuss challenges and opportunities for Africa. This year’s ADS theme is “Cultural identity and ownership: reshaping mindsets. OSAA, as part of its mandate to coordinate global advocacy in support of Africa’s development, is approaching the theme primarily from a sustainable development perspective. To this end, an exciting line up of activities has been prepared for May culminating in a three-day public policy forum focused on discussions among policy makers, researchers, civil society representatives, academics, representatives from the AU and UN entities and other stakeholders.
The Economic Community of West African States (ECOWAS) is considering a legal framework that will make the regional electricity market attractive to investors. The president of the ECOWAS commission, Mr Kassi Brou, described the regional electricity market, currently under construction, as fundamental to the development of West Africa. During his visit to the Accra-based ECOWAS Regional Electricity Regulatory Authority (ERERA), Brou reiterated that energy production is vital to the viability of the market, adding that the regional organisation is already formulating policies that will attract investments. According to him, ECOWAS’ focus was in ensuring transmission and distribution lines for cross-border power exchange and access to the local population.
The Policymaker’s Trilemma (IMF Blog)
Imagine you’re a policymaker in sub-Saharan Africa. You’ve been charged with lifting your country out of the worst health crisis in living memory, and nobody around you knows when it will end – the second wave that gripped the region earlier in the year has eased, but many countries are nonetheless bracing for further waves as winter approaches. The bad news is that, for sub-Saharan Africa, at least, near-term growth prospects are somewhat more subdued. And as long as widespread vaccination remains out of reach, you will face the unenviable task of trying to boost your economy while simultaneously dealing with repeated COVID-19 outbreaks as they arise. This is the situation facing many finance ministers in sub-Saharan Africa today. And they face three immediate challenges: Firstly, to meet increased spending needs; secondly, to contain a pronounced increase in public debt, and finally, to mobilize more tax revenues.
The Heads of State approved the 69 PIDA Priority Action Plan II projects during the Africa Union Heads of State and Government Summit held in February 2021. Subsequent to the approval, the African Union Development Agency (AUDA-NEPAD) held a technical meeting on the 5th and 6th of May 2021 to discuss the status of each of the PIDA PAP II Infrastructure projects. The 69 PIDA PAP II projects discusses at the event, consist of 28 Transport Projects, 18 Energy Projects, 12 Water Projects and 11 Information Communication Technology (ICT) projects. The virtual event successfully managed to create a platform of engagement for all participants to understand the status for each project presented. A clear and understandable process for PIDA PAP II was defined and an opportunity was presented for project sponsors to cooperate with PIDA Stakeholders to advance the projects.
PwC has released the seventh edition of its Africa Value Added Tax guide, comprising updates on VAT regimes in 41 African countries. PwC’s 2021 Africa VAT Guide highlights compliance-related initiatives such as the adoption of real-time VAT reporting and data analysis by various tax administrations to shore up their collections. “The impact of the COVID-19 pandemic and other developments on the continent have caused a rapid shift to virtual, remote operations and new ways of working,” said Job Kabochi, PwC Africa’s Indirect Tax Leader. With the theme of ‘Moving towards a united Africa’, this edition is focused on Africa’s journey into the future and how different countries’ VAT regimes help to shape that journey. “As cross-border trade ramps up, we expect greater attention to be paid to indirect taxes such as customs duties, VAT and excise duty. Accordingly, we have given special attention to the taxation of cross-border supply of both goods and services in this edition of the Africa VAT Guide,” he said.
The African Union Development Agency-NEPAD and the African Union Commission hosted on the 6th May 2021, a consultative dialogue with the Regional Economic Communities on the Common African Position leading up to the UN Food Systems Summit. The dialogues which started in March 2021 are aimed at engaging extensively across various interest groups, players and stakeholders on perspectives, experiences and commitments with the ultimate goal of having a unified African stance at the UN Food Systems Summit scheduled for September 2021. AUDA-NEPAD has been engaging RECs to build necessary linkages with regard to policies, investments and other development instruments on and about food systems.
The Director-General of the Food and Agriculture Organization of the United Nations (FAO), QU Dongyu, warned that severe underfunding of the agri-food sector was preventing Africa from reaching its potential. He spoke at the launch of FAO’s latest report, Public Expenditure on Food and Agriculture in sub-Saharan Africa, which reveals the gap between long-standing political commitments and financial reality in 13 sub-Saharan African countries. He noted that the report was based on “rigorous analysis over the last 15 years, made possible thanks to strong collaboration with our Members in the region.” “Let’s unblock the bottlenecks that are holding back potential by increasing coordination and upskilling human capacity in African nations,” the FAO Director-General urged. “And let’s unlock funds and streamline public financial systems, so that the scarce resources we have do not go unspent.”
Indo-Africa relations growing from strength to strength (Daily Pioneer)
This century will be the century of Asia and Africa, their people working together to promote inclusive globalisation and polity Relations between India and Africa span over thousands of years. At the dawn of history, there was migration of people from Africa to the Mediterranean region and to Asia. Indians have been migrating to Africa and Africans to India over several centuries. Africa now has a population of about 2.5 million people of Indian origin. They shape the economic, political and cultural foundation of an Afro-Indian alliance. Some of the descendants of African emigrants in India are known as Siddis who came in the 10th century and their progeny still live in different parts of India. Gandhiji began his struggle for freedom in Africa and India has always been in the forefront of the movement for independence and sovereignty of the African countries.
Global trade has a role to play in saving lives in the COVID-19 pandemic, creating jobs and sustainable development that mitigates against climate change. This was the view of the panellists at the World Economic Forum’s latest Agenda Dialogues session on the Global Trade Outlook. Leaders, including the new Director-General of the World Trade Organization, Ngozi Okonjo-Iweala, came together to discuss how global trade and investment collaboration can ensure prosperity, equity, and sustainability.
Looking ahead to the WTO’s 12th Ministerial Conference (MC12), taking place from 30 November to 3 December 2021 in Geneva, Dr Okonjo-Iweala said it was critical there were deliverables. “The WTO needs to have some success this year,” she said. “We can no longer take 20 years to negotiate outcomes if the WTO is about people, enhancing living standards, creating employ and sustain development. We have to focus on having successes.” She outlined things to look out for at for MC12, including fishery subsidies negotiations finally coming to fruition after 20 years. On trade and health, she hopes to put in place a framework for how trade will contribute to the solution of future pandemics. And in terms of agriculture, Dr Okonjo-Iweala said we need to look at it through lens of this pandemic: how can we deliver for food security? “Globalization and trade has lifted up hundreds of millions out of poverty, but some people have been left behind,” she said. “What can the multilateral trade system do towards inclusion, for women in trade and SMEs?”
5 things you should know about the state of the economy (United Nations)
Is this the year we overcome the global economic crisis caused by the pandemic? Are our jobs in danger? Who has lost the most in the crisis and what can be done to recover? As UN DESA prepares to launch the mid-year update of the 2021 World Economic Situation and Prospects report, here are five things you need to know about the state of the global economy.
The prospects for global growth have improved but the pace of recovery will differ across countries
The situation of the most vulnerable has become even more precarious
Global trade is in for a strong but uneven recovery
The COVID-19 crisis has inflicted more harm on women and girls
Countries need to do more to address the uneven impact of the COVID-19 crisis
While the global growth outlook has improved, led by robust rebound in China and the United States, surging COVID-19 infections and inadequate vaccination progress in many countries threaten a broad-based recovery of the world economy, says the latest United Nations forecast released today. According to the World Economic Situation and Prospects (WESP) mid-2021 report, following a sharp contraction of 3.6 per cent in 2020, the global economy is now projected to expand by 5.4 per cent in 2021, reflecting an upward revision from the UN forecasts released in January. For many countries, economic output is only projected to return to pre-pandemic levels in 2022 or 2023. “Vaccine inequity between countries and regions is posing a significant risk to an already uneven and fragile global recovery,” said UN Chief Economist Elliott Harris. “Timely and universal access to COVID-19 vaccinations will mean the difference between ending the pandemic promptly and placing the world economy on the trajectory of a resilient recovery, or losing many more years of growth, development and opportunities.”
A global coalition of public development banks today emphasized the urgency of immediate resources for Africa’s recovery post-Covid 19. Together, they committed to deepening cooperation to boost investment opportunities across the continent. Participants in the meeting, hosted by the African Development Bank, brainstormed on joint actions that could help boost a strong and inclusive recovery in Africa. This would be recovery grounded in a dynamic private sector. The pandemic has negatively impacted the debt situation for African countries. Without a resolution of Africa’s $700 billion external debt, the continent’s economic recovery will be delayed and financial market stability will be affected in the short and medium term.
Could Africa be the next hub for COVID drug manufacture? (Amsterdam News)
For a while, Africa appeared to be losing the fight to build manufacturing capacity for the production of COVID-19 vaccines as big pharma and rich countries questioned African capacity to make its own vaccines. Some international companies regard African self-sufficiency as a long-term risk to their business; some fear a loss of influence. This week, in a surprise move, the U.S. threw its support behind a move at the World Trade Organization (WTO) to temporarily lift patent protections for coronavirus vaccines, allowing developing countries to meet their own needs. If approved, supporters say, the waiver could provide more affordable doses for less wealthy countries. Advocates of the move say it would increase global vaccine production of life-saving drugs.
Remarks delivered by ICC Secretary General at sixth ACT Accelerator Facilitation Council Meeting (International Chamber of Commerce)
The International Chamber of Commerce welcomes the new plans presented by GAVI and CEPI on the creation of a new Supply Chain & Manufacturing Taskforce. The plans are very impressive and I was glad to hear so many of ICC’s suggestions – especially on matchmaking and supply chain transparency – taken up. We should not lose sight of where we are headed. While it is sometimes hard to fathom, vaccine production is doing much better than many experts predicted this time last year. So, if the production plans of existing manufacturers can be executed, we will get close to the 10.8B doses needed to vaccinate 75% of the world. But there is a big “if” – this will happen only if the supply chains hold up and countries stop hoarding. So, how do we ensure supply chains hold up?
First, countries must remove existing trade barriers and not impose new ones. Second, we need massive coordination in investment across the full supply chain. Third, I was glad to see take-up of the idea we floated of a global vaccine clearing house to ensure existing manufacturing capacity can deliver for the world, and especially the strong words from Dr Ngozi. Fourth, transparency is absolutely critical, including on when advanced economies are going to start sharing doses, by what mechanisms and in what volumes. Fifth, we need a longer-term plan. Finally, advanced economies must – as a matter of urgency – put up the cash needed to get ACTA fully operational for the remainder of this year.
GFI Calls on Multilateral Leaders to Address COVID-19 Vaccine Integrity (Global Financial Integrity)
Covid-19 has put a great burden on the world’s health systems, most notably those in developing and emerging market countries, which must be remedied. Further, the World Bank notes that Covid-19 has pushed approximately 100 million people into extreme poverty, and the G-20 has said that corruption and fraud in the delivery of Covid-19 related medical products is on the rise. Additionally, as Covid-19 vaccines and personal protective equipment are being distributed, the illicit trade in these preventatives is increasing, for example with instances of dark market vaccines in Mexico as well as many other nations. Indeed, Kenya has stopped the private importation of vaccines due to the level of counterfeiting. Recently, CheckPoint Research noted that there are some 1,200 advertisements for vaccines on the dark web and that this type of activity is “booming.” Much of this fraudulent advertising is due to the fact that developing and emerging market countries do not have access to vaccines.
UNCTAD will bring together experts to explore how science, technology and innovation (STI) can contribute to a sustainable and resilient recovery from the COVID-19 pandemic, during a meeting of the UN Commission on Science and Technology for Development (CSTD) from 17 to 21 May. “The COVID-19 pandemic has underscored the pressing need for countries to focus more on elevating STI in both policy and practical terms,” said Shamika N. Sirimanne, UNCTAD’s director of technology and logistics, who also heads the CSTD secretariat. “But governments also need to make sure that the development benefits of STI translate directly into the daily lives of people all over the world,” Ms. Sirimanne said. Moreover, Ms. Sirimanne added, it’s vital for all countries to have equal access to the benefits of life-saving treatments, not only for the pandemic but also for poverty-related diseases, future health emergencies and infectious disease outbreaks.
A strikingly large percentage of workers and firms operate outside the line of sight of governments in emerging market and developing economies (EMDEs) – a challenge that is likely to hold back the recovery in these economies unless governments adopt a comprehensive set of policies to address the drawbacks of the informal sector, a new World Bank Group study has found. The study, The Long Shadow of Informality: Challenges and Policies, is the first comprehensive Bank analysis examining the extent of informality and its implications for an economic recovery that supports green, resilient and inclusive development in the long-term. It finds that the informal sector accounts for more than 70 percent of total employment – and nearly one-third of GDP – in EMDEs. That scale diminishes these countries’ ability to mobilize the fiscal resources needed to bolster the economy in a crisis, to conduct effective macroeconomic policies, and to build human capital for long-term development.
Focus on blockchain technology, trade facilitation (The Herald)
Demand for predictable, transparent and cost-effective trade is gaining traction amidst a plethora of problems such as the ever-changing trade landscape that of late has been exacerbated by the critical shortage of containers. The critical shortage of containers as articulated in last week’s article has spiked freight rates with East Africa reporting a 100 percent hike, while Sea Intelligence in Freight News magazine has pegged the cost of a 40 – foot container at $7 672 – a 446 percent hike in relation to last year. The advent of containerisation was one of the best innovations complemented by global trade bodies to ensure the expansion of international trade soon after the second World War.
ICC joins global commitment calling for a people-centered approach to achieve meaningful connectivity (International Chamber of Commerce)
ICC Secretary General John W.H. Denton AO has signed a joint statement on how to achieve meaningful connectivity for all at the 2021 High-Level Digital Debate of the United Nations (UN) General Assembly on Connectivity and Digital Cooperation. Technology has been critical to detect and manage the spread of the virus. In the process, digital technologies have reshaped the way we work, study and live our daily lives and these technologies will be critical in achieving an inclusive and durable post-COVID rebuild. However this new normal has remained beyond the reach of many and, without bold and determined action, digital divides will continue to compromise our collective efforts to contain the pandemic and achieve a sustainable economic recovery for all. This is why, on behalf of businesses worldwide, ICC is proudly joining a multistakeholder initiative calling for concerted action at all levels to bridge digital divides, especially the pervasive and persistent gender digital gap.
Why governing data is key for the future of cities (OECD Development Matters)
Technology is changing city dwellers lives, as well as how urban centres evolve to meet their needs. The pandemic has accelerated this transformation, and the digital transition has generated an explosion of data, especially in cities. In this context, the ability of local governments to manage urban problems will be paramount for the recovery, and the pandemic has helped us better understand the missing elements we need to govern cities effectively. It is inconceivable not to consider cities as an integral part of the solution to challenges like tackling social exclusion, improving public services and reducing insecurity, among others. A key issue that has become increasingly prominent in city agendas is the good governance of data; that is how data is handled and for what purpose, its quality and integrity, as well as the privacy and security concerns related to its collection and use. The pivotal role of new technologies and the strategic use of data by municipal governments can also improve delivery of services, making them more accessible, agile, efficient and less costly.
Despite COVID-19, remittance flows remained resilient in 2020, registering a smaller decline than previously projected. Officially recorded remittance flows to low- and middle-income countries reached $540 billion in 2020, just 1.6 percent below the 2019 total of $548 billion, according to the latest Migration and Development Brief. The decline in recorded remittance flows in 2020 was smaller than the one during the 2009 global financial crisis (4.8 percent). It was also far lower than the fall in foreign direct investment (FDI) flows to low- and middle-income countries, which, excluding flows to China, fell by over 30 percent in 2020. As a result, remittance flows to low- and middle-income countries surpassed the sum of FDI ($259 billion) and overseas development assistance ($179 billion) in 2020.
The Foreign Secretary, Dominic Raab, has announced £22 million of new investment to build cyber security resilience in developing countries and globally, particularly in Africa and the Indo-Pacific. As part of this the UK, jointly with INTERPOL, is setting up a new cyber operations hub in Africa working across Ethiopia, Ghana, Kenya, Nigeria and Rwanda to support joint operations against cyber crime. Speaking at the National Cyber Security Centre’s CYBERUK conference he outlined the UK’s vision of being a leading responsible cyber power, working with partners to shape cyberspace according to our values.
The inaugural meeting of the Commonwealth Women’s Ministers Action Group opened yesterday with calls for strong gender equality measures. Delegates, including women’s affairs ministers, reaffirmed their support for gender equality and women’s empowerment, and committed to putting women’s issues at the top of the agenda at the next Commonwealth Heads of Government Meeting (CHOGM) in Rwanda. Commonwealth leaders will table the statement at the next CHOGM which has recently been postponed again due to the COVID-19 pandemic. Strategy actions will help ensure 1.2 billion women and girls living in the Commonwealth have equal access to decision-making, education, family health services and legal protection while mainstreaming gender in climate action. Speaking at the meeting, Commonwealth Secretary-General, The Rt. Hon. Patricia Scotland QC, said: “COVID-19 threatens to roll back the hard-won progress towards gender equality that we have fought for over many decades. Mobilising collective political will is key to safeguarding the progress and changing the pace of efforts towards gender equality. She added: “COVID-19 presents an ideal opportunity for Commonwealth countries to elevate women leaders to positions of influence and to bring diverse voices to the decision-making tables as insurance that response and recovery plans are as effective as possible.”