tralac Daily News
The Minister of Trade, Industry and Competition, Ebrahim Patel, along with industry stakeholders from the steel and metal fabrication sector signed a Master Plan for the sector on Friday 11 June 2021. The Master Plan, which has been developed in consultation with all stakeholders from the industry – including primary steel producers, downstream steel players, met fabricators, and organised labour – provides a blueprint for the industry to re-energise itself and expand production. The steel industry plays an important role in South Africa’s industrial capacity, both as a direct driver of growth, investment and jobs, and as indirect facilitator of South Africa’s construction, automotive and mining sectors.
“Learning from the other masterplans that are in implementation phases, there is a long and steep road ahead of us. Building consensus on the steel masterplan and agreeing on the actions to anchor the implementation was a much easier process. The hard-work has started in the implementation and will get even harder as we began to collectively tackle actions that are very difficult but necessary for the long-term development of this industry,” said Minister Patel.
“De-instrutialisation is a choice and we should start to make the choice that we work together to get industrialisation going– the Steel Masterplan offers us one such opportunity to do this together as partners and citizens of South Africa,” said Director-General Mabitje-Thompson.
Last week was one of good tidings on the policy and economic front. The economy is growing faster than expected, and some of the initiatives launched last week – the freeing up of self-generation power projects and the lifting off of SAA privatisation – suggest momentum is building to support further growth.
On Tuesday, Statistics South Africa (Stats SA) data showed the economy in the first three months of this year had grown on an annualised quarter-on-quarter basis by 4.6%, exceeding expectations of 3.2% growth. That means that South Africa is a bit wealthier than previously expected, and regaining ground lost to the pandemic faster than expected. To support and sustain growth going forward, a whole lot of policy initiatives must be undertaken. And lo and behold, before the week was over, two big ones were unveiled.
Speaking of exports, the South African Reserve Bank said this past week that South Africa’s terms of trade remained in positive territory and improved for a record seventh straight quarter in Q1 of 2021. More capital is entering South Africa than is leaving these shores. After all the loot the Guptas allegedly made off with, this is no bad thing.
Botswana’s efforts to accelerate key economic reforms got a boost following the approval of a $250 million loan by the World Bank today. The Programmatic Economic Resilience and Green Recovery Development Policy Loan (DPL) will support the implementation of Botswana’s Economic Recovery and Transformation Plan and is designed to strengthen COVID-19 pandemic relief while bolstering resilience to future shocks. This DPL is also designed to support reforms to strengthen private sector development and promote green recovery. It is the first-ever World Bank budget support operation for Botswana and the first of two planned operations.
Queries over KRA role in irregular mineral exports (Business Daily)
The taxman is on the spot over irregular exports of gold, gemstones and salt of unknown quantities and value, raising fears the country may have lost revenues. The National Assembly’s Public Accounts Committee (PAC) has given the Kenya Revenue Authority (KRA) Commissioner-General Githii Mburu seven days to provide export permits for 27 entities that exported minerals valued at Sh140,138,850. The committee met Mr Mburu and the Commissioner for Customs and Boarder Control Lilian Nyawanda to explain why firms were allowed to make irregular exports without government permits. Mr Mburu was hard-pressed to explain whether the permits held by the KRA were legally issued by the Ministry of Mining as provided for under the Mining Act 2016.
Taxpayers save Sh5.2bn on Covid-19 travel restrictions (Business Daily)
Taxpayers saved Sh5.21 billion in the nine months to March on travel, training, and per diems for top State officials at the back of restrictions imposed to curb the spread of the coronavirus disease. The latest report from the Controller of Budget (CoB) shows that the top officials spent Sh13.85 billion on their domestic and foreign travel, training, and per diems, a 27 percent fall from Sh19.06 billion spent in the corresponding period the previous year. “Some budget items recorded low levels of expenditure, which was attributed to the impact of Covid -19 mitigation measures adopted by the government to curb the spread of the disease,” Margaret Nyakango, the CoB said. “Those affected were travelling, training and hospitality activities which are some of the major spending budget items by the MDAs (minstries, departments and agencies.”
Zimbabwe targets to hike exports to Rwanda (Chronicle)
Zimbabwe is keen on growing its exports to Rwanda with market survey results by the national export promotion agency, ZimTrade, indicating that locals could ride on this destination to generate more earnings. On Thursday ZimTrade hosted a market intelligence information dissemination seminar focusing on the Rwanda market to prepare and equip local producers with knowledge regarding the vast export opportunities in that country. The intervention buttresses the country’s continued efforts to explore opportunities presented by the African Continental Free Trade Area (AfCFTA), which came into force in January this year. Increasing trade with Rwanda is, thus, expected to enhance access to markets in the East African Community (EAC) and in turn increase Zimbabwe’s exports to the region with a combined GDP of more than US$177 billion. “The services sector is a big deal in Rwanda and the opportunities there are endless. There is tourism also, as well as the education sector because Rwanda is looking for many programmes with Zimbabwe to come into its education sector,” ZimTrade export promotion manager, Mrs Vuyiswa Mafu, told the participants.
Egypt to expand air traffic in Africa after end of pandemic: Aviation Minister (Egypt Independent)
Egyptian Minister of Civil Aviation Mohamed Manar Enaba announced Saturday that his country is preparing to expand air traffic within Africa through national airline EgyptAir in the coming years, following the end of the pandemic. Enaba said that the Egyptian national airline has 36 flight points across the continent, and partnerships have been conducted with many African countries to facilitate the movement of goods through aviation throughout the continent. He explained that the first of these partnerships was with Sudan and South Sudan, and the air cargo fleet has been expanded in a vital step to increase trade movement. The increase in Africa’s share of world trade is linked to the reduction in the cost of aviation between African countries, and the digitization of transport traffic, he noted.
Egypt’s Minister of Trade and Industry Nevine Gamea has said that Egypt pays great importance to achieving regional economic integration in Africa. Gamea highlighted the importance of: activating joint continental work to achieve industrial and agricultural integration; enhance intra-trade; support small- and medium-sized enterprises (SMEs); and create more job opportunities. These contribute to Egypt achieving the UN’s sustainable development goals (SDGs) 2030 at the continental level, and the 2063 development agenda set by the African Union (AU). The minister’s remarks were made at a panel session entitled “Africa’s Pursuit for a Bigger Role in Global Markets”, held as part of the Investment Promotion Agencies (IPAs) Forum.
As Nigeria grapples with a high rate of unemployment, some enterprising members of the society are seeking out new ways to earn a living legitimately, and one of such ways is drop-shipping. Oladunni Ayorinde, Chief Executive Officer, Cart Deals, is one of such Nigerians and she is quite popular for her business acumen and leadership skills, especially in the drop-shipping and fashion industry in Nigeria. “The fashion house has shifted from importation to local production using imported fabrics, while the finished products would then be sold via drop-shipping. As the business started growing with support funding from my husband, I resigned from my job and focused fully on the business. At a point, I sold my car and ploughed the money into the business to expand it further,” Oladunni said.
Malawi will have access to immense opportunities in the post-COVID-19 environment despite the accompanying challenges the period will pose, says Stephen Karingi, Director of the Regional Integration and Trade Division of the Economic Commission for Africa (ECA). “In trying to address the challenges caused by the pandemic, there are significant trade and business opportunities. These opportunities are available to Malawi too,” he said. “The key will be to attract, protect and nurture foreign direct investment and industrialization to Malawi whilst at the same time profiting from a more open market for Africa’s population,” said Beatrice Neri on behalf of the EU.
London and Hong Kong-based risk management consultancy A2 Global Risk published a new report assessing the investment risks associated with port infrastructure expansion in Sub-Saharan Africa, against the backdrop of global geopolitical competition. The COVID-19 pandemic and associated restrictions on travel and operations caused unprecedented disruption to international trade and highlighted the risks linked with ageing port infrastructure and regional bottlenecks. Cognisant of such risks, African governments are actively seeking to expand their infrastructure and trade provisions to reduce non-tariff barriers, as part of their efforts to modernise their trade infrastructure, such as airports, seaports, roads, and internet access. International actors active in this space are ramping up their competition for market access amid mounting trade and geopolitical tensions globally.
Deputy Director General of the African Development Bank (AfDB) Group for North Africa and Egypt Country Manager Malinne Blomberg said Sunday in IPAs Africa Forum 1 “we don’t want the [African continental] free trade area to be a consumption zone. We want to be an industrial zone.” Blomberg added that the AfDB supports “the industrial value chains across the continent.”
A new comprehensive, segmented and dynamic framework to inform the formulation of sub-regional and national industrialization and economic diversification masterplans (PDIDE, in French) has taken root in Central Africa, with the aim of turning the zone into a poly-hub for green growth and net-zero industrialization in multiple sectors. “Our proposition within this Framework is not just to show where potential is but to elicit action straightaway, given the abundance of resources which should enable Central Africa to leapfrog the carbon-intense stages of industrialization, which characterized the First Industrial Revolution, and take-off with green industrialization,” remarked Antonio Pedro who heads ECA’s Sub-regional Office for Central Africa. “Central Africa is no doubt the home of the world’s coveted minerals not only for the battery and electric vehicle value chain but also for electronic equipment.
Inside East Africa’s post-Covid 2021/22 recovery budgets (The East African)
East Africa’s Finance ministers on Thursday presented their spending plans for the 2021/2022 fiscal year with a key focus on rebuilding economies ravaged by the Covid-19 pandemic, protecting local industries, keeping jobs and up-scaling investment in infrastructure projects critical to the faltering intra-regional trade. The Treasury chiefs, who tabled the budgets against a backdrop of weakening macroeconomic environment, declining domestic revenue collections and mounting public debt, spelt out temporary taxation measures to protect local industries from cheap imports ahead of the conclusion of the review of the regional Common External Tariff (CET). They also increased budgetary allocations to key growth sectors such as manufacturing, health, tourism, agriculture and transport infrastructure to enhance domestic and regional connectivity.
The ministers proposed changes in the CET for one year to stimulate economic recovery through industrialisation and inclusive growth. They also agreed to continue implementing measures that were effected in the 2020/2021 fiscal year. Other customs taxation measures agreed on include a stay of application of the EAC CET rate of 10 percent and application of a duty rate of 0 percent for one year on wires and alloy steel to reduce the cost of these inputs, and a stay of application of a CET rate of 25 percent and application of a duty rate of 0 percent for one year on milk cans to provide relief for the dairy sub-sector.
Tanzania’s Minister for Foreign Affairs and East African Cooperation, Hon. Amb. Liberata Mulamula, has reaffirmed Tanzania’s commitment to regional integration and enhancing intra-EAC trade. Speaking during a private sector roundtable engagement dinner on EAC regional integration organized by the East African Business Council (EABC) in Dar es Salaam, the Minister said that in the spirit of enhancing intra-regional trade, Tanzania was revitalizing trade relations with her neighbours. “We can all bear witness that the trade issues between Kenya and Tanzania have been addressed, and we are determined to ensure that such challenges do not arise in the future,” said Hon. Mulamula.
“The Partner States want value for money, and value for money is results, we have therefore committed ourselves to join efforts to produce the results as expected by the Partner States,” added the Secretary General. Dr. Mathuki briefed the President on the need for the region to devise strategies to enhance intra-EAC trade, which currently stands below 15%, if the region is to realize the vision of a prosperous and competitive East Africa. “Dialogue with the private sector is important to enable us address the various barriers to trade. It is my hope that in the next five years, we shall be recording intra-EAC trade above 50%,” he added.
The Secretary General said that to better facilitate regional trade, there is need for the establishment of the EAC Disputes Settlement Mechanism, as provided for under Article 24 of the EAC Customs Union Protocol to address all matters pertaining to trade, including the Rules of Origin, anti-dumping measures, subsidies and countervailing measures, and safeguard measures.
Mauritius ready to sign SADC Gender Protocol (The Southern Times)
Mauritius is expected to sign the SADC Protocol on Gender and Development soon, a move that signifies the regions commitment to promote gender equality and equity. The SADC Protocol on Gender and Development, which entered into force in 2013 and was later revised in 2016 provides for the empowerment of women, elimination of discrimination, and achievement of gender equality and equity through gender-responsive legislation, policies, programmes and projects. Fourteen SADC member states are party to the protocol, with the exception of Mauritius and the Union of Comoros, which is the newest member of SADC. The SADC Protocol on Gender and Development was revised so that its objectives are aligned to various global targets and emerging issues.
The Secretariat of the Southern African Development Community (SADC) and the Government of the Federal Republic of Germany on 11 June 2021 held bilateral negotiations on development cooperation to take stock and agree on the priorities for future development cooperation. H.E. Dr Tax said the cordial and long-standing bilateral partnership for development that exists between SADC and Germany has contributed to the attainment of SADC development and integration objectives and appealed to the Government of Germany to continue supporting SADC efforts through priorities outlined in the Regional Indicative Strategic Development Plan (RISDP) 2020-2030 and the SADC Vision 2050 in order to achieve the desired developmental impact to enhance the living standards of SADC citizens.
While noting the importance of Regional Economic Communities (RECs) as building blocks to continental integration, H.E. Dr Tax encouraged the Government of Germany and other partners to continue working with, and through the RECs to push the continental integration agenda forward. On this note, H.E. Dr Tax emphasised the need to ensure that the support towards the operationalisation of the African Continental Free Trade Area (AfCFTA) should go together with the COMESA-EAC-SADC Tripartite Free Trade Area (TFTA), as the TFTA is an important pillar to the implementation of the AfCFTA.
With only 2 per cent of the raw cotton grown in West Africa processed regionally, the scope for strengthening the textile value chain is huge in the region, according to a new focus report by London-based Oxford Business Group (OBG), which examines the potential that the West African textile and garment industry to turn a driver of sustainable growth and major employer across the Economic Community of West African States (ECOWAS). “While West Africa is the world’s sixth-largest cotton grower, 90% of the raw product is exported to Asia to be made into finished goods,” says Bernardo Bruzzone, Africa regional editor for OBG.
Export credit agency (ECA) finance is an important lever for infrastructural development in West Africa. According to deal intelligence platform TXF Data, Africa was the second-most active region globally in 2020 for ECA-supported financing, with more than $35.5bn worth of ECA-supported debt. The success of an ECA project can be narrowed down to three factors: government involvement, digitisation and direct financing. This was one of the topics discussed at the GTR West Africa 2021 Virtual Conference, held earlier this year.
The World Bank Group said it is extending $465 million to support the Economic Community of West African States (ECOWAS) expand access to grid electricity to over 1 million people. The fund will help the subregion enhance power system stability for another 3.5 million people, and increase renewable energy integration in the West Africa Power Pool (WAPP). The new regional electricity access and Battery-Energy Storage Technologies (BEST) project -approved by the World Bank Group for a total amount of $465 million- will increase grid connections in fragile areas of the Sahel, build the capacity of the ECOWAS Regional Electricity Regulatory Authority (ERERA), and strengthen the WAPP’s network operation with battery-energy storage technologies infrastructure.
Many are eyeing the G7 countries, who are set to meet in June, to lead the way to vaccine equity. But two questions persist: why are vaccines not reaching everyone? And what can we do about it? As the pharmaceutical powerhouse of the world and a key supplier of the COVAX initiative, India was poised to help a great number of developing and least developed countries by supplying COVID vaccines. However, facing a catastrophic second wave itself, it has not only stopped exporting vaccines, but is now beginning to import them. The implications of this could be severe, particularly for poorer countries that were depending on India. The ripple effects would hit the most vulnerable countries the hardest, leaving them behind in the respective vaccination drives.
The production of vaccines is highly concentrated, mainly in a small number of higher and middle-income countries. The necessary raw materials, too, are imported from only a handful of countries. The two top exporters of key ingredients, for instance, are the US and the EU – which account for half of total exports – followed by the UK, Japan and China, with significantly smaller shares. This implies that restrictions on exports of vaccines or other critical raw material and equipment by even one or two countries can easily send shockwaves through the rest of the world, derailing the entire vaccine production and distribution effort, as we see at present. Export restrictions are not exclusive to vaccines. Over 80 countries had resorted to banning exports of medical and personal protective goods in the early phases of the pandemic. This too had severe supply chain implications. Nearly 60% of these curbs are still in place.
We, the leaders of the Group of Seven, met in Cornwall on 11-13 June 2021 determined to beat COVID-19 and build back better. We remembered everyone who has been lost to the pandemic and paid tribute to those still striving to overcome it. Inspired by their example of collaboration and determination, we gathered united by the principle that brought us together originally, that shared beliefs and shared responsibilities are the bedrock of leadership and prosperity. Guided by this, our enduring ideals as free open societies and democracies, and by our commitment to multilateralism, we have agreed a shared G7 agenda for global action to:
End the pandemic and prepare for the future by driving an intensified international effort, starting immediately, to vaccinate the world by getting as many safe vaccines to as many people as possible as fast as possible.
Reinvigorate our economies by advancing recovery plans that build on the $12 trillion of support we have put in place during the pandemic.
Secure our future prosperity by championing freer, fairer trade within a reformed trading system, a more resilient global economy, and a fairer global tax system that reverses the race to the bottom
Protect our planet by supporting a green revolution that creates jobs, cuts emissions and seeks to limit the rise in global temperatures to 1.5 degrees.
Strengthen our partnerships with others around the world.
Embrace our values as an enduring foundation for success in an ever changing world.
We shall seek to advance this open agenda in collaboration with other countries and within the multilateral rules-based system. In particular, we look forward to working alongside our G20 partners and with all relevant International Organisations to secure a cleaner, greener, freer, fairer and safer future for our people and planet.
Criticism from health and environment campaigners followed the release of the final G7 communique. “This G7 summit will live on in infamy,” said Max Lawson, the head of inequality policy at international aid group Oxfam. “Faced with the biggest health emergency in a century and a climate catastrophe that is destroying our planet, they have completely failed to meet the challenges of our times.” Campaigners also complained that the G7 failed to go into details about how it will pay for a newly agreed “Nature Compact” – aimed to protect 30% of the world’s land and oceans from further destruction by 2030.
Additionally, the 1 billion coronavirus vaccine doses for poorer countries falls far short of the 11 billion doses the World Health Organization said is needed to vaccinate at least 70% of the world’s population and truly end the pandemic.
“To successfully contain a virus of this nature, to limit loss of life and to prevent the emergence of new variants requires that as many of the world’s population is vaccinated in the shortest time possible,” President Ramaphosa said. “Since its formation a year ago, the ACT-Accelerator has supported more than 70 countries to expand lab infrastructure for testing and delivered millions of rapid diagnostic tests; accelerated development and production of vaccines; delivered more than 69 million doses since February 2021; and procured PPE (personal protective equipment) with a value of more than US$ 500 million,” he said.
He noted that the proposed Trade-Related Aspects of Intellectual Property Rights (TRIPS) waiver is a temporary, targeted and proportional response, which recognises the unprecedented nature of the pandemic. “Addressing the intellectual property barriers, enabling the transfer of technology and know-how, whilst facilitating backward integration to raw materials and distribution rights, is fundamental for scaling up manufacturing of medical products and equipment.
At a meeting of the Committee on Technical Barriers to Trade (TBT) on 2-4 and 9 June, WTO members discussed 20 proposals submitted under the Triennial Review of the TBT Agreement. The review will now move to a second phase, with the preparation of a draft report based on the 31 proposals received. The aim is to develop a set of recommendations by year-end on how to improve implementation of the Agreement. Members also discussed 86 specific trade concerns covering environmental products, food and other issues.
The proposals submitted by WTO members address various issues, with transparency featuring strongly across many members’ proposals. Other areas include conformity assessment, accreditation policies, the impact of standards on micro, small, and medium-sized enterprises (MSMEs), e-commerce and online shopping, cybersecurity and digital products (including artificial intelligence), the use of international standards for food regulation, lessons learned from COVID-19, and climate change.
The conservation of biodiversity matters because of its intrinsic worth, and because ecosystem services, which depend upon biodiversity, underpin human wellbeing, and support economic activity in a range of sectors. Our survival is, finally, impossible without intact natural landscapes and seascapes. At the same time, the COVID-19 pandemic has led to a deep global recession, impeding the growth of the tourism which is the largest market-based source of finance for protected areas and jeopardizing conservation efforts worldwide. These intersecting calamities – a pandemic in a time of biodiversity loss – call for a response which speaks to both crises, addressing economic losses and promoting recovery through actions which simultaneously support biodiversity conservation.
The recently launched Banking on Protected Areas: Promoting Sustainable Protected Area Tourism to Benefit Local Economies makes a call to promote sustainable tourism in protected areas to recover from the economic fallout of the pandemic, address longstanding development challenges, and conserve biodiversity.
A new global analysis says that greenhouse-gas emissions from food systems have long been systematically underestimated--and points to major opportunities to cut them. The authors estimate that activities connected to food production and consumption produced the equivalent of 16 billion metric tons of carbon dioxide in 2018 – one third of the human-produced total, and an 8 percent increase since 1990. A companion policy paper highlights the need to integrate research with efforts to reduce emissions. The papers, developed jointly by the UN Food and Agriculture Organization, NASA, New York University and experts at Columbia University, are part of a special issue of Environmental Research Letters on sustainable food systems. The lead author of the analysis, Francesco Tubiello, heads the environment statistics unit at FAO. He said the study shows that food production represents a “larger greenhouse-gas mitigation opportunity than previously estimated, and one that cannot be ignored in efforts to achieve the Paris Agreement goals.”
New Initiatives in Southern Hemisphere Fresh Fruit (Produce Business UK)
The Southern Hemisphere Association of Fresh Fruit Exporters (SHAFFE) was founded in the early 1990’s from the leading trade organisations from Australia, Argentina, Brazil, Chile, New Zealand, Peru, South Africa and Uruguay. The idea was to form a common platform for exchange on the most crucial market access matters in Northern Hemisphere markets, including phytosanitary protocols, food safety, consumption, and trade trends. With the digital era kicking in – accelerated by the current pandemic conditions and in the context of an increasingly more complex global trading environment – SHAFFE members took the initiative of focusing on strengthening cooperation far beyond the existing way of going about the association’s usual business. Hence its members developed a strategic plan of action with the objective of connecting the Southern Hemisphere’s fresh fruit industry through knowledge-sharing, facilitating market access and promoting global fruit trade.
Unless we make some major adjustments to the way the planet is run, many observers believe that business as usual puts us on a path to catastrophe. Whilst there is no universally agreed definition of a circular economy, the 2019 United Nations Environment Assembly, the UN’s flagship environment conference, described it as a model in which products and materials are “designed in such a way that they can be reused, remanufactured, recycled or recovered and thus maintained in the economy for as long as possible”.
Increasingly, in both the developed and the developing world, consumers are embracing the ideas behind the circular economy, and companies are realising that they can make money from it. “Making our economies circular offers a lifeline to decarbonise our economies”, says Olga Algayerova, the head of the UN Economic Commission for Europe, (UNECE), “and could lead to the creation of 1.8 million net jobs by 2040”.
A key meeting of IMO’s Marine Environment Protection Committee (MEPC 76) has begun. Opening the session, IMO Secretary-General Kitack Lim highlighted key amendments set for adoption, aimed at cutting the carbon intensity of ships by 40% by 2030. He emphasized the need for IMO to timely deliver on the implementation of the IMO Initial Strategy on the reduction of GHG emissions from shipping, which will ensure achieving the levels of ambition and providing a globally harmonized regulatory framework, in line with the Paris Agreement. “The stakes are high, adoption of short-term measures at this session is crucial to our ability to deliver on the commitments we have made in our initial strategy. Let me be blunt, failure is not an option, as if we fail in our quest, it is not unreasonable to conclude that we run the risk of having unilateral or multilateral initiatives, but, I have full confidence that you will demonstrate that the IMO can be trusted to deliver on commitments it has already agreed,” Mr. Lim said.
Gross domestic product (GDP) of the G20 area returned to pre-pandemic level in the first quarter of 2021, growing by 0.8% compared with the fourth quarter of 2020. However, this figure conceals large differences across countries. For the remaining G20 economies, GDP is still lagging behind pre-pandemic levels, with countries recording diverging developments in the first quarter of 2021. While GDP growth accelerated in the United States (to 1.6%, after 1.1% in the fourth quarter of 2020) and Italy (to 0.1%, following a contraction of 1.8%), growth slowed in Indonesia (to 1.6%, after 2.3%), Canada (to 1.4%, after 2.2%), South Africa (to 1.1%, after 1.4%) and Mexico (to 0.8%, after 3.2%). Year-on-year GDP growth of the G20 area rebounded to 3.4% in the first quarter of 2021, following a contraction of (minus) 0.7% in the previous quarter.