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SA making efforts to improve ease of doing business (SAnews)
South African cities are making efforts to improve the ease of doing business, although the pace of reforms has been slow in the last three years, according to a World Bank Group report. South Africa is one of the countries counted among others that have implemented reforms making it easier to do business. These reforms were implemented from May 2018 to May 2019. This was revealed at a webinar organised by BrandSA and Invest SA, through the Department of Trade, Industry and Competition (DTIC) in collaboration with Government Communication and Information System (GCIS) and the Companies and Intellectual Property Commission (CIPC) on Tuesday.
In the area of Trading Across Borders, the report measures four of South Africa’s maritime ports – Cape Town, Durban, Ngqura, and Port Elizabeth. In the case of South Africa, GCIS Director-General Phumla Williams said working together and ensuring that bold reforms are undertaken can move the country back into the top 50 of the World Bank Ease of Doing Business Index.
The biggest risks to South Africa right now: economists (Business Tech)
South Africa’s GDP results for Q1 2021 are positive, with the outlook for the rest of the year also relatively encouraging, says economists at Nedbank. However, a number of local issues threaten to derail the country’s good start to the year, the bank said in a research note on Tuesday (8 June). These include: A lack of reliable and cost-effective electricity supply; Frequent power outages (load shedding); High unemployment; Slow Covid vaccine rollout; Slow implementation of structural reforms. “From the production side, growth will be driven mainly by mining and manufacturing, buoyed by increased global demand and elevated commodity prices.”
Trade between Nigeria, South Africa hits $2.9b in 2020 (The Guardian Nigeria)
Nigeria’s mission in South Africa issues 10,341 passports in 15 months Despite concerns about xenophobia between Nigeria and South Africa, bilateral ties between the two countries hit $2.9 billion last year with hopes of improved trade with the African Continental Free Trade Area (AfCFTA).
Zimbabwe’s Economy is Set for Recovery, but Key Risks Remain (World Bank)
Gross Domestic Product (GDP) growth in Zimbabwe is projected to reach 3.9 percent in 2021, a significant improvement after a two-year recession, according to the World Bank Zimbabwe Economic Update (ZEU) launched today. Economic growth this year will be led by recovery of agriculture as rains normalize, businesses adjust to limitations caused by the COVID-19 (coronavirus) pandemic, and inflation slows down. However, disruptions caused by the pandemic will continue to weigh on economic activity in Zimbabwe, limiting employment growth and improvements in living standards. The ZEU, Overcoming Economic challenges, Natural Disasters, and the Pandemic: Social and Economic Impacts, provides the World Bank perspective on macroeconomic and poverty developments and discusses ways to strengthen public service delivery in key sectors.
Trade balance remains in N$2 billion deficit (New Era)
April 2021 saw Namibia’s total merchandise trade increase to N$18.7 billion, which is an upsurge of 0.8% and 43.3%, compared to N$18.6 billion and N$13.1 billion recorded in March 2021 and April 2020, respectively. However, the country’s trade balance remained in a deficit of N$2 billion, increasing from N$1.8 billion recorded in both March 2021 and April 2020. The trade balance compares the country’s trade flow with the rest of the world in terms of export earnings and expenditure on imports. Between April 2020 to April 2021, Namibia recorded a positive trade balance, amounting to N$325 million, only in June 2020. According to the April 2021 Trade Statistics Bulletin compiled by the Namibia Statistics Agency (NSA), Namibia’s trade composition by partner illustrated that China remained Namibia’s largest export market, while South Africa maintained her first position as Namibia’s largest source of imports.
In Kenya, Food Retailers Race to Improve Safety Standards (IFC)
Naivas is one of a growing number of African supermarkets that are adopting international food safety standards, a trend experts say could dramatically improve the quality of meat and produce on local shelves. That is considered crucial on a continent where contaminated food sickens more than 91 million people every year and causes $110 billion in economic damages, much of it in lost productivity. Many see stricter standards as an investment in their brand and an avenue to sales growth, says Sarah Ockman, IFC’s Lead for Manufacturing, Agribusiness, and Services Advisory. Others are being pushed by risk-conscious investors who worry about the financial fallout of a food poisoning scandal, she adds. “We are witnessing what I think is the beginning of a sea change,” says Ockman. “Farmers, food processing companies, grocery stores – they are all starting to take food safety much more seriously, and that’s a good thing for the health and wellbeing of Africans.”
Kenya Lauded for Achieving 75% Electricity Access Rate (COMESA)
Kenya has dramatically increased electricity access over the last few years, from 2.3 million connections in 2013 to 8.2 million by the end of April 2021 thereby achieving electricity access rate of over 75%. This was disclosed during the just concluded joint meeting of COMESA Ministers responsible for transport and communication, information technology and energy on 2 June 2021. The meeting also noted that most COMESA countries were actively working to increase the share of renewables in the energy mix and creating an enabling environment for conducive development of the sector. Among these initiatives is the establishment of regulatory bodies and institutions responsible for accelerating access to electricity.
MPs blow Sh10 billion hole in President’s pet infrastructure projects (Business Daily)
Parliament has cut Sh9.6 billion from the Finance ministry’s budget, casting doubt on the operations of various infrastructure projects that President Uhuru Kenyatta placed under the docket last year. The Budget and Appropriations Committee (BAC) reviewed the Treasury’s budget from Sh167.84 billion to Sh155.17 billion for the year starting July. The MPs, however, gave Treasury a token Sh980 million for public participation and Sh700 million for a parking spot in Malaba that softened the blow.
Tanzania asks for fresh report on Kenya’s industrial sugar (The East African)
Tanzania has refused to grant preferential tariff treatment to Kenyan made confectionery after faulting the report of the industrial sugar verification by Kenya. Instead, President Samia Suluhu’s administration has demanded another verification to determine the taxable status of Kenyan made confectionery. This comes even as the two East African neighbours work on a new beginning of mutual co-operation after years of tit-for-tat trade and diplomatic relations. In 2018, Tanzania imposed a 25 per cent import duty on Kenyan confectionery, including juice, ice cream, chocolate, sweets and chewing gum, claiming Kenya had used zero-rated industrial sugar imports to produce them, in contravention of the East African Community (EAC) Rules of Origin.
Lucrative food trade aim (Botswana Daily News)
Government wishes to position Botswana as an active player in the global multi-billion dollar food industry. Officiating during World Safety Day in Gaborone on Monday, Minister of Health and Wellness, Dr Edwin Dikoloti said that was achievable through growing net exports on indigenous food products and becoming self-reliant. He said minimizing disruptions in food supply chains therefore remained one of government’s highest priorities.
ECA pledges to help Malawi reap the benefits of the AFCFTA (UNECA)
The Economic Commission for Africa (ECA), through its African Trade Policy Centre (ATPC) unit, will continue to provide technical assistance to Malawi to enable it benefit fully from the African Continental Free Trade Area (AfCFTA). Mr. Chikwene said the capacity of the country’s trade support institutions would be enhanced so that operators in the trade sector could get all the help they would need to succeed. “Without an efficient and focused network of trade support institutions working to make trade work for Malawi, the benefits of the AfCFTA may take too long to be realized,” he said. “The key will be to attract, protect and nurture foreign direct investment (FDI) and industrialization to Malawi whilst at the same time profiting from a more open market” for Africa’s population, it said.
Nigeria, Burundi to sign agreements on trade, investment (Daily Trust)
Nigeria and Burundi are set to sign bilateral agreements on trade, investment, education, technology and tourism. The Head of the Nigerian Mission in Burundi, Amb Elijah Onyeagba, announced this in a statement. He said the inaugural session of the Nigeria-Burundi Joint Commission is slated to hold in Bujumbura, Burundi from 5th -10th July, 2021. Onyeagba said on the top on the agenda of the Joint Commission are Education Cooperation, Political Consultation and Technical Aid Corps. The statement read, “The Nigerian Plenipotentiary to the Republic of Burundi, Amb. Elijah Onyeagba PhD, is optimistic that this Joint Commission will revolutionalize trade and investment, improve the standard of living of both countries and create a multiplier effect towards economic rejuvenation of both countries.” However, during the session Nigeria is expected to sign a Bilateral Agreement on AfCFTA, Agricultural Research/Development, ICT, Tourism, Creative industry and Security.
Ghana launches GH¢145 million SME grant fund (GhanaWeb)
President Nana Addo Dankwa Akufo-Addo has launched the Ghana Enterprises Agency (formerly NBSSI), the National Micro, Small and Medium-Scale Enterprises (MSMEs) and Entrepreneurship Policy, and the GEA Grant Support for SMEs, under the Ghana Economic Transformation Project, which is backed by the World Bank. The President indicated that the National Micro, Small and Medium Enterprises and Entrepreneurship Policy is the first of its kind in Ghana, adding that “it is a policy designed to direct the growth of the sector, provide clear policy direction and opportunities for all actors within the MSME space, to enable them contribute meaningfully towards the development of the country”.
Improve cultural and business exchanges to facilitate trade partnerships – GUTA (GhanaWeb)
Dr Joseph Obeng, President of the Ghana Union of Trade Associations (GUTA) has called for the improvement in cultural and business exchanges to facilitate trade partnerships between Ghanaian businesses and the United Kingdom investors. He said Ghanaian businesses must seek partner investors with expertise in manufacturing and value addition. Dr Obeng made the call at the UK-West Africa Trade Opportunities in a COVID-19 Era; Trade Opportunities Webinar Series organised by the UK-Ghana Chamber of Commerce. Opportunities available are manufacturing in consumables, Pharmaceuticals, Agrochemical and Agro-processing, Hardware, Electricals and Electronic products, Building of Warehouses and Construction.
Cargo movers see AfCFTA driving business recovery (Business24 Ghana)
Downed by the coronavirus pandemic, transporters of cargo are now seeing a steady rise in the volume of goods that they cart to landlocked countries which use the nation’s ports. Shocks to supply chains and reduced industrial activities after the coronavirus outbreak curtailed cargo traffic through Ghana’s ports, reducing volumes for both transit and domestic hauliers. But the situation is reversing gradually, according to Ibrahim Musa, the Executive Secretary of the Joint Association of Port Transport Unions (JAPTU), who sees brighter prospects due to the coming on stream of the single continental market. “So far, on the state of the business, we think it’s good; but then we also believe it can even be better than it is now, especially with the take-off of the African Continental Free Trade Area (AfCFTA). This market now gives us access to the entire continent to do trade. So, we want to believe that with the expansion of our ports and the role that the Shippers Authority is playing, we should be able to move more cargo,” he told Business24 in an exclusive interview.
Transporters need right push to thrive in AfCFTA (Business24)
The implementation of the single continental market for trade has been met with applause from players in almost all sectors of the economy. The latest group of workers to throw their weight behind the continental project are those in the transport and logistics sector, specifically truckers and haulers who cart cargo through the nation’s transit corridors. To them, an open market means more cargo to move across borders, especially from one landlocked country to another, something that is not permissible currently despite numerous existing trade protocols. But the fortunes of these critical businesses in the shipping industry in their dealings continent-wide will come from prudent policies and interventions from both government and direct stakeholders. This is because Ghanaian transporters been faced with serious challenges from their counterparts in landlocked countries for quite a long time. They have now asked government to use the Ecowas protocols as a case study to identify similar issues that may arise and tackle it head on.
Liberia: Importers Want Increment in Price of Rice Due to Rise Cost of Importation (FrontPageAfrica)
The Rice Importers Association have appealed to the Government of Liberia to permit an increment on the price of rice due to rising cost of importation. According to the Association, there is a worldwide increment in freight while at the same time fees for services at the National Port Authority (NPA) have also gone up. They expressed fears that there may be shortage of rice on the market if there is no increment in the price. The importers said their attention has also been drawn to the recent increment of fees of vessel and warehouse operation by the Association of Liberia Stacking Companies.
New report: Skills matching and technology sustain jobs in Togo (ITC)
Companies in Togo that were satisfied with the skills of their workforce and had invested heavily in research and development before the pandemic were less likely to dismiss workers once COVID-19 hit, according to a new report by the International Trade Centre (ITC). That’s because these firms valued their workers and drew on their skills to respond to the crisis. Just 6% of firms whose workforce skills were aligned with enterprise needs let workers go during the pandemic. In contrast, 25% of companies that had weak skills matching before the pandemic had to fire employees. This finding, which makes the case for investing in technological capabilities and spreading appropriate skills throughout the workforce, is detailed in Promoting SME Competitiveness in Togo: A resilient foundation for transformative growth.
Africa
Pandemic recovery presents an opportunity for Africa to reinvent its growth model (Mo Ibrahim Foundation)
The 2021 Ibrahim Forum Report, COVID-19 in Africa one year on: Impact and Prospects, outlines how recovery from the pandemic provides an opportunity to define and drive a new growth model for the continent. Launched by the Mo Ibrahim Foundation ahead of the 2021 Ibrahim Governance Weekend (IGW), the report presents new analysis on Africa’s challenges as exposed by the pandemic, including weak health capacities, setbacks in human development, rising instability and a vulnerable economic growth model. The comprehensive report on the impact of COVID-19 across the continent serves as an urgent wake-up call. It also points to clear avenues where Africa can now build back better. Commenting on the launch of today’s report, Mo Ibrahim, Founder and Chair of the Mo Ibrahim Foundation, said: Africa has demonstrated strong leadership in its response to COVID-19. However, the data also shows where we are falling short. We now have an opportunity to harness lessons from the pandemic to build an African-led recovery that champions good governance, strengthens continental integration, and puts young people at its centre.
Billionaire philanthropist: vaccine hoarding hurts Africa (Minneapolis Star Tribune)
Billionaire philanthropist Mo Ibrahim is sharply criticizing the hoarding of COVID-19 vaccines by wealthy nations, urging the international community to “walk the talk” of equitable distribution as Africa desperately lags behind. He lamented the global “competition” for vaccines in an interview with The Associated Press. He said he views the the pandemic-era phrase “nobody is safe until everybody is safe” as a meaningless slogan until there is an equitable distribution of COVID-19 vaccines around the world.
AfDB says $10bn COVID-19 fund boosting Africa’s recovery (Daily Trust)
The African Development Bank (AfDB) has said the $10 billion COVID-19 relief facility it began disbursing since the heat of the pandemic in 2020 is boosting the recovery of several African countries. “Out of the 54 African countries, 43 saw a decline in domestic revenue ranging from 30 to 70 per cent. Regional trade was paralysed in many parts of Africa with the borders closed,” he said. He also said Africa is a net importer of food, purchasing food of about $135 billion annually while export was down from the continent. Six countries struggled to finance their sovereign debts because of the oil price collapse and the pandemic while eight others found it hard to pay their civil servants and domestic debts.
Social dialogue is the key to fostering trade union participation in recovery and resilience in Africa (Equal Times)
The Covid-19 pandemic has mutated from a health emergency into one of the most serious global socio-economic crises in living memory. Its adverse impacts can be felt throughout society, especially in the world of work, and particularly in Africa, where it has exacerbated underlying structural challenges and humanitarian crises throughout the continent. While it is clear that Covid-19 has grossly affected workers, African governments have attempted to implement measures to impede the spread of the virus without meaningfully engaging with workers on issues that affect them. Social dialogue, a mechanism that brings the social partners (government, workers and employers) together to discuss and negotiate on work-related issues, has in most countries has been piecemeal or non-existent.
The Tripartite of the Common Market for Eastern and Southern Africa (COMESA), East African Community (EAC) and Southern African Development Community (SADC) on 8th June, 2021 held its 33rd meeting of the Tripartite Task Force (TTF). During the meeting, the Executive Secretary of SADC, Her Excellency, Dr. Stergomena Lawrence Tax, handed over the rotational Chairpersonship of the Tripartite Task Force to the Secretary General of EAC, Dr. Peter Mutuku Mathuki. She indicated that, while a number of Member/Partner States that have ratified the Tripartite Free Trade Area Agreement (TFTA) increased from six to 10 during her tenure as Chairperson of the Tripartite Task Force, there is need to continue encouraging the outstanding Member/Partner States to fast-track the ratification of TFTA Agreement in order to reach the threshold of 14 Member/Partner States required for the Agreement to enter into force. She stressed the importance of the TFTA as a stepping stone for the implementation of the Africa Continental Free Trade Area (AfFCTA). So far Egypt, Eswatini, Kenya, South Africa, Rwanda, Burundi, Uganda, Botswana, Namibia and Zambia have ratified the TFTA Agreement.
In addition to the approval of Harmonised Tripartite Guidelines on Trade and Transport Facilitation Guidelines for Safe, Efficient and Cost-Effective Movement of Goods and Services during the COVID-19 pandemic; other milestones attained during SADC’s tenure as Chair of the Tripartite Task Force include Draft Tripartite Agreement on Movement of Business Persons; Draft Annex 1 on Elimination of Import Duties to the Agreement Establishing a TFTA Agreement; Draft Annex II on Trade Remedies to TFTA Agreement; Draft Annex IV on Rules of Origin to the TFTA Agreement, and Draft Annex X on Dispute Settlement Mechanism to the TFTA Agreement; Vehicle Load Management Agreement; Multilateral Cross Border Road Transport Agreement; Vehicle Load Management Model Law; Cross Border Road Transport Model Law; Road Traffic Model Law; Road Traffic and Transport Transgressions Model Law; and Transport of Dangerous Goods by Road Model Law. These Legal instrument will be presented to Council during its next meetings, and are expected to facilitate effective operationalisation of the TFTA.
Zim To Become Second SADC Country With Bus Manufacturing Plant (NewZimbabwe)
Zimbabwe is set to become the second SADC country and also part of a countable few in Africa with bus manufacturing and assembly plants when it launches its own next month. The plant, a partnership between Amalgamated Bus Industries, Quest Motors Manufacturing, AVM Africa and China’ Zhongtong Buses, will start operating next month with a target of 500 buses per year. Speaking at a Memorandum of Understanding (MoU) signing event in Harare Wednesday, Zimbabwe Passenger Transport Organisation spokesperson Kura Sibanda said the revival of their industry will also ignite downstream revival, save foreign currency and create employment.
Meeting of the Sectoral Council of Ministers of EAC Affairs and Planning underway in Arusha (EAC)
A five-day meeting of the Sectoral Council of Ministers on EAC Affairs and Planning (SCMEACP) is currently underway at the EAC Headquarters in Arusha, Tanzania. Among the items on the agenda of the meeting are the: Consideration of the Progress Report on the Status of Implementation of the EAC Common Market; Consideration of the Report on the Revised Draft Council Directive on Coordination of Social Security Benefits in the EAC; Consideration of the Status of Partner States’ Contributions to the EAC Budget, and; Consideration of the Draft 2nd EAC Communication Policy And The Draft 2nd EAC Communication Strategy.
A Chinese-built port in the Indian Ocean: The story of Kenya’s Lamu port (Observer Research Foundation)
Kenya recently launched its newest mega infrastructure project, the Lamu port, which is a part of an ambitious transport corridor between Lamu (a small archipelago north of Mombasa in Kenya), South Sudan and Ethiopia. The Lamu port is believed to be a cornerstone of the Kenyan government’s Vision 2030 development plan, and is now being branded as a ‘game changer’ project. The port is part of the wider US $23 billion Lamu Port South Sudan-Ethiopia Transport (LAPSSET) corridor and has been constructed by China Communications Construction Company, with the first three of the planned 32 berths coming at a cost of US $367 million. This transport corridor is touted to comprise a standard gauge railway line; an oil pipeline and refinery; road network; international airports at Isiolo, Lamu, Lokichogio; the port of Lamu at Manda Bay; and resort cities.
Nigeria, Togo, Others Plan $570m Power Transmission Line (THISDAY Newspapers)
The federal government, represented by the Transmission Company of Nigeria (TCN) along with Togo, Burkina Faso and the Niger Republic, yesterday commenced a high-level meeting in Abuja, to put final touches to the execution of a planned $570 million transmission line which runs across the four countries. “Nigeria has the greatest advantage among these countries because the electricity is going to be exported from Nigerian Gencos. So, from that, the revenue is going to be enhanced and a lot of people will be employed in Nigeria,” Managing Director of the TCN and Chairman, Executive Board of the West African Power Pool (WAPP), Mr. Sule Abdulaziz said. “The cost is about $570 million and the part of the investment in each country is funded by the country and they are supported by the donors and Nigeria are taking its own.”
Opinion: Why EU conservation efforts will fail without Africa (Devex)
The European Green Deal is the flagship policy from the European Commission under President Ursula von der Leyen, aiming to achieve net-zero greenhouse gas emissions by 2050. It is an ambitious plan for Europe to be a more resource-efficient, competitive economy. The European Parliament approved the European Climate Law in May, giving a boost to the ambitions of the European Green Deal. Yet Europe alone cannot deliver on the deal. In seeking to ensure the continent is climate-neutral, it must work with global partners.
The European Green Deal is a global one that needs Africa to make it work. The text of the deal says drivers of climate change and biodiversity loss are international and not limited by country borders. Von der Leyen and Werner Hoyer, president at the European Investment Bank, said in March that action beyond European borders is necessary. They jointly called for a “Global Green Deal” to ensure the increase in Earth’s temperature is as close to 1.5 degrees Celsius as possible.
Turkey is looking forward to boosting trade with East Africa (The New Times)
Geographically, Turkey is a bridge between Europe and Asia. Due to its location, surrounded by sea on three sides, Turkey has always been the center of great trade, Europe, the Middle East, and African culture. Besides its geographical importance, Turkey has been playing an important role in world exports for many years as a major producer. For Turkey, which ranks 27th among the global exporters, the African continent has been an important target and strategy partner since the beginning of the 2000s. Turkey’s attempt to accelerate its political, military, cultural and economic relations with African countries started with the “Opening to Africa Action Plan” prepared in 1998. This plan gained momentum in 2002. And, in 2005, the “Year of Africa” was declared in Turkey. In the same year, Turkey became an observer in the African Union.
India must work out a mechanism to be part of Africa’s mega trade deal (Lokmat English)
As the African Continental Free Trade Area (AfCFTA) officially kicked off in January, India must now proactively make a strong pitch to be able to get access to the member countries for expansion of bilateral trade, experts said. At a time when China has slowed its investments into the continent, India has an opportunity. The continent will also play an important role as the geopolitical thrust shifts towards the Indo Pacific. “India has increased its economic activities in Africa, its investments have risen significantly in the last few years but now New Delhi must work out a mechanism with the AfCFTA to be able to expand bilateral trade further,” Pradeep S Mehta, Secretary General, CUTS International told India Narrative.
Global economy
Small Island Developing States face uphill battle in COVID-19 recovery (UNCTAD)
Small island developing States (SIDS) face an uphill battle as they strive to recover from the impact of the COVID-19 crisis amid vulnerabilities worsened by the pandemic, according to the 2021 edition of UNCTAD’s Development and Globalization: Facts and Figures report.
Trade: COVID-19 has severely hit SIDS’ services exports, heavily reliant on tourism Services exports contribute on average 25% to SIDS’ GDP and almost half of their exports consist of travel services. SIDS import more goods than they export – 24 of them had a negative trade balance in goods of more than 55% of imports in 2020. SIDS tend to import manufactured goods and export commodities, especially food. High trade openness, the average of sum of exports and imports of goods and services relative to GDP, exposes SIDS to greater market fluctuations than other developing economies. SIDS’ trade openness averaged 95% for the period from 2005 to 2019.
Many SIDS are poorly connected in terms of maritime connectivity, paying approximately 7% more than the world average for freight for transport of their imports. Digital connectivity in SIDS is quite high as it’s not constrained by geography. Nonetheless, exports of ICT goods by SIDS account for a relatively small share of total merchandise exports, averaging between 0.5% and 3% in the period from 2000 to 2019.
FDMD Okamoto’s Remarks at the 2021 Public Debt Management Forum (IMF)
Allow me to make three observations about the overall context for the discussions we will have here today. First, while the global outlook has improved dramatically thanks to breakthroughs in vaccine development, as well as extraordinary monetary and fiscal support, many risks remain. For Emerging Markets, gross-financing needs remain high, at 14 percent of GDP, while sovereign-bank nexus risks are growing. It is concerning that 60 percent of debt issued after January 2020 has ended up on domestic banks’ balance sheets. The second observation I’d like to make is that we need to ensure everyone has a fair shot at receiving the vaccine, benefiting from the recovery, and achieving their future goals. To accomplish this, public debt increases are inevitable. “Ensuring a fair shot for all” also means tackling debt vulnerabilities early. Where debt is unsustainable, it should be restructured without delay. While gaps remain in the international debt restructuring architecture, the G20 Common Framework now provides a new and more inclusive forum for LICs to negotiate debt restructurings. It is imperative that the international community invigorate the Common Framework, and the IMF has committed to provide the technical support needed to achieve this goal. Lastly, I would like to stress the importance of debt transparency, especially in these uncertain times.
Pandemic Relief Policies Need More Resources, Better Design (Inter Press Service)
Pandemic relief measures in developing countries have been limited by modest resources, fear of financial market discipline and policy mimicry. COVID-19 has triggered not only an international public health emergency, but also a global economic crisis, setting back decades of uneven progress, especially in developing countries. LMICs must address various urgent needs and other short-term problems. They need to finance emergency contagion containment and relief measures for those most adversely hit by the pandemic. What makes the pandemic economic shocks different?
World Bank opposes vaccine intellectual property waiver as WTO talks resume (Reuters)
World Bank President David Malpass said on Tuesday the bank does not support waiving intellectual property rights for COVID-19 vaccines at the World Trade Organization out of concern that it would hamper innovation in the pharmaceuticals sector. His comments on the subject, made during a call with reporters on World Bank economic forecasts, came as WTO negotiations over the proposed waiver resumed in Geneva. Asked whether he backs a WTO vaccine IP waiver, which India, South Africa and other emerging market countries argue is needed to expand vaccine access, Malpass said: “We don’t support that, for the reason that it would run the risk of reducing the innovation and the R&D in that sector.”
WTO panel considers easing protections on COVID-19 vaccines (Associated Press)
Envoys from World Trade Organization member nations are taking up a proposal to ease patents and other intellectual property protections for COVID-19 vaccines to help developing countries fight the pandemic, an idea backed by the Biden administration but opposed in other wealthy countries with strong pharmaceutical industries. On the table for a two-day meeting of a WTO panel opening Tuesday is a revised proposal presented by India and South Africa for a temporary IP waiver on coronavirus vaccines. At stake in the meeting is whether the various sides can move toward drawing up a unified text, a key procedural step that could unlock accelerated negotiations. Inside observers cautioned, however, that a major breakthrough was not expected.
WTO members ready for text-based negotiations (BusinessLine)
UN experts to G7: Production of safe COVID-19 vaccines must outweigh profit (UN News)
“Everyone has a right to have access to a vaccine for COVID-19 that is safe, effective, timely and based on the application of the best scientific development”, the experts said ahead of the three-day Summit of the G7 intergovernmental group of leading countries in the United Kingdom, which begins on Friday. The nine independent experts said it was time for “international solidarity and cooperation” to assist all Governments in vaccinating people and saving lives. “It is not the time for protracted negotiations or for lobbying to erect barriers in order to protect corporate profits”, they underscored. “Billions of people in the Global South are being left behind. They see vaccines as a mirage or a privilege for the developed world”, explained the experts, which, they added, would “unnecessarily prolong the crisis, drastically increase the death toll and deepen economic distress, possibly sowing the seeds of social unrest.”
Trade and food security: When an agreement delayed becomes a human right denied (UNCTAD)
Access to food should never be a luxury. It is a fundamental human right. Yet in 2020, 155 million people faced severe food insecurity. And the situation could deteriorate further. Food prices are perilously climbing to heights like those that have sparked food crises and riots in many parts of the world during the last two decades. Making sure this situation does not worsen – and in fact improves – depends on many factors. One has to do with the capacity of a country to produce food at home and import it from abroad. This is where trade comes in, and its role is not minor. The value of food imports has tripled since the beginning of the century, and today about 80% of the world’s population is fed in part by imports.
Global food trade is buoyant, as are prices (FAO)
Global food trade is poised for a resilient year ahead even as international food commodity prices are set to remain high amid supply and demand uncertainties, according to a United Nations report released today. And contrary to widespread predictions of a collapse in international food markets, trade flows continued to reach new highs during the ongoing COVID-19 pandemic, says a report published by the Food and Agriculture Organization (FAO). In fact, on a global level, trade in agricultural products – particularly less-perishable foods – performed more robustly than the broader merchandise sectors. World output of the major food commodities is expected to increase in the year ahead, with the exception of sugar, which is forecast to decline for the third consecutive year and fall short of global consumption, pointing to the need to run down inventories.
Ambitious $104 million program targets land degradation in Africa and Central Asian countries (FAO)
The global launch of a $104 million initiative signals an ambitious effort by a range of partners to safeguard drylands in the context of climate change, fragile ecosystems, biodiversity loss, and deforestation in 11 African and Central Asian countries. Funded by the Global Environment Facility and led by the Food and Agriculture Organization of the United Nations (FAO), the Sustainable Forest Management Impact Program on Dryland Sustainable Landscapes helps pave the way for initiatives linked to the UN Decade on Ecosystem Restoration. The Program will be implemented in partnership with the International Union for the Conservation of Nature, the World Bank, and the World Wildlife Fund. The 11 countries covered are: Angola, Botswana, Burkina Faso, Kazakhstan, Kenya, Malawi, Mongolia, Mozambique, Namibia, Tanzania, and Zimbabwe.
How can the EU’s border carbon adjustments avoid unintended consequences for LDCs? (Trade 4 Dev News)
Border Carbon Adjustments (BCAs) are a carbon price imposed on goods when they are imported into a jurisdiction with a higher carbon price. BCAs are intended to level the playing field between domestic products that adhere to climate change targets and imported products that do not. Such adjustments can help to maintain domestic climate ambitions and may encourage low-carbon investment throughout global supply chains.
Currently, LDCs overall do not have significant exports in any of the sectors that the EU’s new BCA scheme is likely to target, though Mozambique does feature as an important supplier of aluminium. But, coverage of the EU’s Emissions Trading Scheme (ETS) is likely to grow in the future and therefore so too the scope of BCAs. Additionally, there is scarce information on the potential for LDCs’ indirect exports to be affected through ripple effects in supply chains. There is potential to disincentivise exports that may serve sectors where BCAs are applied. For example, LDCs could be affected not only because they directly export to the EU, but also supply the EU indirectly, e.g. through other processing countries. Should those countries be hit with BCAs, LDC inputs could also be penalised and this may threaten export growth and economic diversification opportunities.
In short – LDCs will need enabling frameworks and substantial support to ensure that they are not penalised by BCAs, whether through indirect exports into the EU or the additional costs associated with compliance for direct exports.
