tralac Daily News
Rebuilding The South African Industrial Base – Progress with Sugar and Poultry Masterplans (the dtic)
Solid progress is being made with implementation of partnership agreements in the poultry and sugar industries. This was noted by the Minister of Trade, Industry and Competition Ebrahim Patel and Minister of Agriculture, Land Reform and Rural Development Thoko Didiza during the Executive Oversight Committee (EOC) meetings held with industry captains, union leaders and government officials on Thursday. The poultry industry reported an increase in production of chickens locally with about 290 000 additional chickens produced every week compared to a year ago. The sugar industry reported a largely flat local demand market in the first two months of the 2021/22 growing season, with a notable increase in soft-drink manufacturer uptake of local sugar and a decrease in demand for local sugar by wholesalers and retailers. A small recovery in export sales is expected.
Mining returns must promote more employment-friendly activities (SAnews)
President Cyril Ramaphosa says there is a need to ensure that the returns from mining are used to promote more employment-friendly activities and that they empower mineworkers and mining communities. “We have to direct investments in infrastructure and a more efficient regulatory framework to both take advantage of new opportunities in mining and to support overall growth once the upward cycle in commodity prices ends,” President Ramaphosa said on Monday. In his weekly newsletter, President Ramaphosa said mining is vital to the country’s economy and has always had a dual role both in the economy and society. “On the one hand, mining contributes over half of our goods exports, around 10% of GDP and 5% of employment. It is a pillar of our capital goods industry. It is not a coincidence that when global metals prices peak, our economy and job creation also surge. “On the other hand, mining has historically been central to South Africa’s deep inequalities. Ownership is concentrated in a few huge companies, while workplaces, pay-scales and communities around the mines are still largely shaped by discriminatory relationships established under apartheid,” President Ramaphosa said.
Govt still poorly consulting with private sector on impacts of Covid-19 lockdowns, says BLSA (Engineering News)
Despite the improvements in government’s approach to tackling the Covid-19 pandemic and associated lockd own regulations, Business Leadership South Africa CEO Busi Mavuso says government has still not embraced consultation with the private sector. She points out this has been a case in point with government’s decision to ban alcohol sales and sit-down dining, yet again, without talking to the alcohol or restaurant industries beforehand.
ZimTrade heads to SA after Rwanda move (The Standard)
Zimbabwe’s export trade promotion body ZimTrade says it will next month explore opportunities for Zimbabwean products in South Africa. The excursion into Zimbabwe’s largest trading partner will be key in helping the country rebuild its export base after suffering a US$300 million trade deficit during the first quarter of 2021, as imports continued to dominate the value of goods exported by the country. In its first quarter economic bulletin released recently, the Finance ministry said Zimbabwe imported goods worth US$1,4 billion during the period, and exported goods worth US$1,1 billion. Trade deficit has haunted Zimbabwe for many years as its industries struggle to produce and export higher volumes compared to an avalanche of goods flowing in from other countries.
The South African mission is the second to be announced by ZimTrade within a month, after the agency earlier said it would be leading another delegation to Rwanda to explore export opportunities. Official data indicates that Zimbabwe gets about 40% of its import requirements from South Africa, while about 75% of its total exports are absorbed by that country. The trade between the two is, however, heavily skewed in favour of South Africa.
Feature: Zambian traders benefiting from medicinal spices during COVID-19 pandemic (China.org)
Reports suggest that the use of medicinal plants has increased during the COVID-19 pandemic period. Interactions with Lusaka-based traders revealed that spices with medicinal elements sales have more than doubled during the COVID-19 period and sellers are continuously running out of stock. Traders dealing in herbs and spices are realizing substantial returns from their merchandise in general and from ginger and cinnamon in particular, which are common ingredients for homemade remedies in urban communities of Zambia.
Boost for Digital Transformation in Africa as Huawei Pens Deal with African Telecommunications Union (The Citizen)
The African Telecommunications Union (ATU) has recently signed a Memorandum of Understanding (MoU) with tech giant Huawei that will see African countries and organizations build capacity for ICT transformation. Under the agreement, Huawei will provide training on skills development, including reskilling and upskilling for ATU members. The MoU will also see the two organizations collaborate to support local innovation, share information on latest trends, challenges and solutions in Africa and globally, and expand the digital economy as well as rural connectivity, in the continent, through furthering research.
Tanzania to manufacture Covid-19 vaccine (The Citizen)
Tanzania is pondering local manufacturing of Covid-19 vaccines in an attempt to reduce importation costs. Health Permanent Secretary Prof Abel Makubi said in Dodoma on Sunday that the factory would manufacture vaccines for Covid-19 and other diseases. “We have a lot of experts. We will make it. We will not only produce Covid-19 vaccines but also those [vaccines] for other diseases so that even when the pandemic ends, Tanzania will still have the capacity of producing such medicines locally,” said Prof Makubi.
AfCFTA: FG assures on elimination of 90 percent Tariffs on tradable goods (Vanguard)
The Minister for Industry, Trade and Investment, Mr Niyi Adebayo, has said the African Continental Free Trade Area, AfCFTA would eliminate tariffs on 90 percent of tradable goods over five years for developing countries and 10 years for least developed countries. Presenting a progress report of the National Action Committee on AfCFTA, Secretary of the Committee and Senior Special Assistant to the President on Public Sector Matters, Mr Francis Anatogu, said the Committee had developed a National Implementation Plan for inputs from government and private sector stakeholders. He explained that domestication of the AfCFTA, border regulations enforcement and rules of origin enforcement, trade facilitation and ease-of-doing-business as well as quality infrastructure improvement were some of the progresses made so far.
AfCFTA: How weak manufacturing sector reduces Nigeria’s strength (New Telegraph)
From available figures, Nigeria remains Africa’s largest economy by GDP but her manufacturing sector remains weak despite the six years of the economic diversification programme of the President Muhammadu Buhari’s administration. The 2020 Gross Domestic Product (GDP) report released by the Nigerian Bureau of Statistics (NBS) revealed that the real GDP of the manufacturing sector contracted by -2.75 per cent in 2020.
Nigeria recorded total export revenue of $10.4 billion in 2019, the highest since 2008 which is farthest we can trace the country’s export data. According to the data from the CBN, total exports (Free on Board “FOB”) in 2019 were $64.9 billion. Thus, for the first time ever, oil revenue as a percentage of total exports fell to 83.9 per cent as against over 90 per cent in previous years. Non-oil exports jumped over 100 per cent from $4.6 billion to $10.4 billion. Non-oil exports typically averaged $4.7 billion in the last 11 years and hit its highest in 2013 when it stood at $7.2 billion. But as they say, you need to dig deeper to see the facts behind the figures. A deep dive into the data revealed that a huge component of Nigeria’s non-oil export figures were “re-exports”.
Report: Tax Obligations, COVID-19 Impact, Forex Worry CFOs (THISDAY Newspapers)
Chief Financial Officers (CFOs) of top Nigerian corporate organisations have stated that foreign exchange (forex) availability, taxation and the impact of COVID-19 are their three major sources of concern in managing the finances of their respective organisations. They expressed these views in the KPMG Nigeria 2021 CFO Outlook Survey (Half Year Review, June 2021), which also identified security, infrastructure and power as top three matters government should address to enhance ease of doing business, stimulate economic growth and improve public trust in the country’s economy. “These are the same issues identified year after year and it draws attention to the need for new thinking and a consistent, coordinated approach to addressing them,” the report stated.
Implementation of iEPA between EU and Ghana begins today (Myjoyonline.com)
The implementation of the interim Economic Partnership Agreement (iEPA) between the European Union and Ghana takes off from today. This means the EU market will accepts goods from Ghana on the duty-free quota-free access policy , whilst the country also liberalise access to its market for 80% of the total volume of EU exports, a statement from Trade and Industry Ministry indicated. The statement said “this is crucial for developing and diversification of our bilateral trade. It also creates better opportunities for EU companies to trade and invest in Ghana and produce goods for export to the wider African market under the preferences available under the African Continental Free Trade Area.” Furthermore, “the removal of tariffs on intermediary goods and machinery from the EU under the iEPA will mean cheaper inputs for Ghanaian production. This will also make locally produced goods more competitive and support industrial development in Ghana and the country’s integration into global value chains.”
Cocoa constitutes half of Ghana’s EU exports (Business24 Ghana)
The Head of the European Union (EU) Delegation to Ghana, Diana Acconcia, has said cocoa represents about 50 percent of the country’s total exports to the union, with almost half of the cocoa products processed. Speaking to manufacturers at a forum in Accra, Ms. Acconcia said the EU was Ghana’s second-largest trading partner last year, adding that the trade relation Ghana has with the EU is quite different from others. She explained that Ghana is able to export most of its cocoa products into the EU processed as a result of the investment the union has made in the country’s manufacturing sector, which has also created jobs for the youth. She said although most of Ghana’s trade is currently outside the African market, with the start of the African Continental Free Trade Area (AfCFTA) agreement, the country is now rightly focused on the African market. However, she pointed out that the EU market remains important for Ghana’s quest to boost exports.
AGI Prez calls for incentives to boost manufacturing (Business24 Ghana)
Ghana’s industrial sector needs sound fiscal policies that motivate and improve the competitiveness of local manufacturers to ensure their sustainability and survival, says Dr. Yaw Adu-Gyamfi, President of the Association of Ghana Industries (AGI). Speaking at the inauguration of Wilmar Africa’s US$30m detergents plant in Tema, he noted that the fast-moving consumer goods (FMCG’s) sector is under pressure and stiff competition from imported products that have flooded the domestic market, forcing some investors to move their operations to neighbouring countries.
“Competitiveness is critical to the survival of every business in Ghana today, and if we’re able to reduce the cost of doing business and get Ghanaians to patronise locally-made goods, that’s the only way we can become competitive,” he said. “We will need to further improve our business climate in order not to be displaced by competitors in the single continental market and the global economy,” he added.
Govt must domesticate AfCFTA to boost OPS, says NACCIMA boss (The Nation Newspaper)
The new National President of the National Association of Chambers of Commerce, Industry, Mines and Agriculture (NACCIMA), Ide John Udeagbala has impressed on the federal government the need to domesticate the African Continental Free Trade Area Agreement (AfCFTA) in order to promote the nation’s private sector. “This is a giant leap towards increasing intra-African trade and creating collective wealth. It is also a bold step to take Africans out of poverty. “This is why we have focused on it at this conference. We are delighted at the work of the National Action Committee on AfCFTA since its establishment and have been part of its sensitisation activities, through the NACCIMA committee on AfCFTA.”
Ethiopian retains top rank in Africa for passenger, cargo (Trade Arabia)
Ethiopian Airlines, the largest Pan-African airline, has been ranked first for passenger and cargo traffic in 2020 retaining its leadership position in the continent, according to the African Airlines Association’s (AFRAA) report. The airline carried 500,000 tons of freight and 5.5 million passengers through its main hub, Addis Ababa Bole International Airport during the year. Ethiopian Airlines Group CEO Tewolde Gebre Mariam said: “We are honoured to continue our leadership even during the Global Pandemic Crisis which has devastated the aviation industry. This is a manifestation of our resilience and agility. We are excited about the role we played in the fight against the pandemic by continuing our much-needed air connectivity within Africa and with the rest of the world without any flight suspension. We are saving lives through air transport of medical supplies and vaccines.” The cargo terminal has handled more than 500 thousand tons of freight during the year 2020.
COVID-19: What should govt do to resuscitate dampened economy? (New Vision)
President Yoweri Museveni announced the new 42-day lockdown measures two weeks ago, after a spike in infections, which he said was beginning to bear heavily on both the economy and the health care system. Experts said as it was with the first lockdown, the new measures announced by the President will definitely dampen economic activity and several sectors are likely to remain paralysed post lockdown. Economic performance in the first COVID-19 wave contracted to 3.0% from an estimated 7%, before rebounding to 3.3% in 2020/21, according to finance state minister in charge of planning Amos Lugoloobi. According to Bank of Uganda (BOU) deputy governor Michael Atingi-Ego, the Government was more concerned with how to save lives at the onset of the first wave, hence the lockdown and, as a result, the economy suffered enormously.
Uganda’s traders sleep rough as Covid lockdown drags on (The Citizen)
Under a strict 42-day coronavirus lockdown imposed on June 18, vendors at Nakasero market in downtown Kampala were allowed to keep trading – but only if they agreed not to return home and sleep where they worked. Sentoongo Mansoor, vice chairman of Nakasero market, said the lockdown was having an economic impact, hitting traders particularly hard. Throughout the night, truckloads of fresh produce are delivered to Nakasero from across Uganda, but it is not clear it can all be sold with trade in a slump.
Italy top destination for Uganda’s exports (New Vision)
The year 2020 was a dark year for business, but not for some exporters. The European Union is a lucrative market of 450 million people. Any business person’s dream is to have a share of such a pie. According to Bank of Uganda external sector statistics 2020, Italy was the top destination for Uganda’s exports, fetching $166m in export revenue. Uganda’s total exports to the European Union (EU) totalled $505m. Italy contributed 32% of this amount to our national coffers. Compared to other trade blocs, the EU figures might appear overshadowed. The market has high growth potential and unexploited opportunities. Uganda earned $1.9b from the Middle East. The Common Market for Eastern and Southern Africa (COMESA) raked in $1.3b. This means exports to the EU make up less than half the exports to COMESA and the Middle East. The EU is Uganda’s third ranking export trade bloc destination.
Niger’s key economic players review their country’s AfCFTA strategy (UNECA)
Key players in Niger’s economy are reviewing their country’s National Strategy for implementing the African Continental Free Trade Area (AfCFTA) with the support of the Economic Commission for Africa (ECA), in collaboration with the European Union Commission and the government of Niger. The two-day meeting which began on Thursday in Niamey is part of a technical assistance project aimed at deepening trade integration through the effective implementation of the AfCFTA with financial support from the EU.
The Minister of Industry, Trade and Youth Entrepreneurship, Mr Gado Sabo Moctar, said: “the implementation of the AfCFTA is perfectly in line with the objectives of the Niger Renaissance Program Act 3. There is a need to create the conditions for the emergence of a competitive private sector by taking concrete actions to promote investment in the productive sectors,” he said.
In her own remarks, the EU Ambassador to Niger, Mrs Denisa-Elena Ionete, said: “The first reason for satisfaction is to note that this national workshop brings together all stakeholders involved in this process, and follows the national consultations. This indicates the participatory and inclusive nature of the exercise. Trade is one of the strategic and traditional areas of mutual interest in EU-African Union cooperation and a key pillar of the new EU-Africa partnership.”
ECA in West Africa holds a conversation with youth in Côte d’Ivoire on their contributions to the structural transformation of their countries (UNECA)
The United Nations Economic Commission for Africa (ECA) Sub-Regional Office for West Africa (SROWA) on Tuesday held a conversation with young people in Côte d’Ivoire on their contributions to the structural transformation of their countries. The meeting, which was held in Abidjan under the chairmanship of the Director of the ECA’s Sub-Regional Office for West Africa, Ngone Diop, brought together some thirty representatives of youth movements and associations in Côte d’Ivoire. The main objective was to engage Ivorian youth to take ownership of the imperative of structural transformation and the development strategies to achieve it in the case of the sub-region in general, and Côte d’Ivoire in particular, so that they can contribute and benefit from it.
South Sudan Economic Update: Economic Decline, COVID-19, and Conflict have Negative Impact on Food Insecurity and Livelihoods (World Bank)
Driven by a decline in both oil and non-oil sectors and several concurrent shocks including COVID-19, South Sudan’s economic growth is expected to contract by -4.1 percent, according to the World Bank. The South Sudan Economic Update, Pathways to Sustainable Food Security, shows that declining exports and private consumption, as well as the effects of the pandemic, floods, locust invasion and higher subnational conflict intensity have contributed to a dire economic outlook. While the oil sector continues to dominate the economy – accounting for more than one-third of gross domestic product (GDP), 90 percent of central government revenue and more than 95 percent of the country’s exports – the report says recent economic downturn highlight the need to diversify growth and revenue. Despite the negative economic indicators, the report anticipates economic recovery as the global economy rebounds to support higher oil prices, commitment to a credible reform process and resilience to climatic shocks and conflict.
Tunisia hopes Libya stability could bring economic relief (WION)
After years of war in Libya, Tunisian traders celebrated the reopening of the border with their oil-rich North African neighbour as a positive sign they hoped would stimulate economic growth. Tunisia’s economy has lurched from crisis to crisis since the country’s 2011 revolution, most recently due to the coronavirus pandemic and lockdown measures. Now Tunisian traders now are hoping for better times ahead. In March, a new Libyan unity government was sworn in, and in June, Libya’s coastal road – linking Tunisia in the west to Egypt in the east – reopened after two years of being closed due to fighting. The challenges are not over, as Libya has once again closed its border for two weeks following a surge of coronavirus cases in Tunisia.
Durban announced as new host of Inter-African Trade Fair (APA)
The South African port city of Durban has been awarded the right to host the 2nd Intra-African Trade Fair (IATF2021) after logistical challenges caused by the COVID-19 pandemic forced organisers to move the event from the Rwandan capital Kigali. In a statement on Monday, IATF2021 Advisory Council chairperson Olusegun Obasanjo said the decision to move the fair was arrived at after the Rwandan government “indicated that logistical constraints related to the COVID-19 pandemic had adversely affected the progress of construction of a new facility to host the event.”
Proposed AfCFTA investment protocol should be simplified to attract foreign direct investment into Africa, says ECA’s Karingi (UNECA)
The Economic Commission for Africa (ECA) today made a pre-launch presentation of a report which offers policy recommendations to member states wishing to take advantage of the economies of scope and scale of the envisioned AfCFTA Investment Protocol to attract investment. The report, titled “Towards a Common Investment Area in the African Continental Free Trade Area: Levelling the Playing Field for Intra-African Investment” was presented by Stephen Karingi, Director, Regional Integration and Trade Division of the ECA, at the Annual Investment Meeting (AIM) event “AFRICA Unlocked: Innovation & Sustainability as the Drivers of Economic Growth.”
“As Africa faces a steep decline in foreign direct investment (FDI) during and in the aftermath of the COVID-19 pandemic, the opportunities presented by a continental common investment area could hardly have arrived at a better time,” Mr. Karingi said. He said amidst a sharp drop in global FDI due to COVID-19, Africa’s FDI inflows fell 18 percent from $46 billion in 2019 to $38 billion in 2020, a level not seen for at least a decade, and deeper than that in developing economies where they declined 12 percent. To attract new FDI during the post-pandemic recovery and rebuilding stage, he said upcoming AfCFTA negotiations should serve as a platform to harmonize investment rules and create a level playing field for investors.
Africa needs radical international investment law reforms (Namibian)
Emerging literature based on African economies has argued that foreign investment laws have led to countries favouring multinationals, neglecting local companies. As a result, Africans need to spearhead radical reforms to become providers of investment rules as opposed to mere consumers of such rules, law professor Olabisi Akinkugbe says. “Contrary to the promise of spurring economic development in developing countries, international investment laws infringe the interests of investors,” he says. In a paper Akinkugbe released earlier this year, titled ‘Africanisation and the Reform of International Investment Law’, he describes the Africanisation of international investment law as a form of post-colonial African international legal knowledge production.
Matrix talks up AfCFTA prospects (The Southern Times)
Diversified United Kingdom-based Metrix Petroleum says the Africa Continental Free Trade Agreement (AfCFTA) presents great opportunities for Africa’s development. Matrix CEO Mr Malvin Chiwanga this week said their company was already present in South Africa, Zambia and Zimbabwe, and it was now expanding into Namibia and Tanzania through the linkages provided by AfCFTA. “Intra-Africa trade is worrisomely low at the current moment, especially when it comes to oil and gas… Perhaps what has dragged intra-Africa trade back is the fact that we are all resource-centred and we produce more or less the same commodities, hence we need to look at value addition. In terms of oil and gas, we need to look at potential to refine crude oil.”
Sadc PF symposium shines light on key pitfalls (Sunday Mail)
A regional symposium convened by the SADC Parliamentary Forum (SADC PF) last week, has revealed pitfalls on the road towards full realisation of the African Continental Free Trade Area (AfCFTA) and galvanised parliamentary action as the region angles for rich pickings from the colossal trade agreement. “The impact of the AfCFTA will depend not only on what is agreed in the negotiations, but also on whether African countries domesticate, implement, and comply with the provisions of the AfCFTA agreement,” H.E. Wamkele Mene said. “The immediate benefits of the AfCFTA are expected to come from a reduction in tariffs/duties, elimination of Non-Tariff Barriers (NTBs) and cutting red tape by simplifying customs procedures… You need the correct infrastructure, a developed industrial base to manufacture finished products and an integrated market.”
Port users set for better services as EA states battle for dominance (The East African)
A quiet, yet vicious battle for the shipping business is under way in Eastern Africa with Tanzania, Kenya, Djibouti and Somalia as the protagonists. Tanzania, home to the most ambitious port project in the region – the $10 billion Bagamoyo Port – has announced plans to revive it construction, potentially turning the tables on its competitors. The project features a special economic zone and industrial park that are billed to attract at least 700 business units and dominate the freight business along Africa’s Indian Ocean coastline, eclipsing Kenya’s equally ambitious Lamu port project.
This battle of the ports has come at an opportune time for users, who are gearing up for improved services and competitive rates and a range of choices on which port to use. Shippers Council of Eastern Africa Chief Executive Gilbert Lagat said competition is working to their advantage. Mr Lagat said the competition has seen most ports invest in different modes of transport but noted a need to embrace the Multimodal Transport Treaty, which allows the carriage of goods by at least two different modes of transport, to reduce congestion.
Soyabean, pulses shipments stuck in E. Africa (BusinessLine)
Subramani Ra Mancombu About one lakh tonnes of soyabean and pulses set to be imported into India have got held up in East Africa due to non-availability of containers. According to two trade sources, soyabean makes up nearly 70,000 tonnes of the consignments stuck in Africa with higher costs of freight adding to the importers’ woes. The pulses, all from the crop being harvested currently comprise mainly pigeon pea (arhar or tur) and lentils (moong or green gram), have been contracted for imports but are struck as importers are not able to find a way to get it into India. “Containers are simply not available. Even if they are available, we face uncertainty as to when they will load our consignments” said a Mumbai-based trader. The other problem that importers face is the cost of hiring a container to get the consignments. “Currently, we pay $60 a tonne for the container. This is almost thrice the $20-25 we used to pay earlier,” the Mumbai based trader said.
EAC Ministers Meet Today as EALA MPs Eye Millions of Dollars in Allowances (ChimpReports)
The East African Community (EAC) Meeting of the Council of Ministers opens this Monday morning in Arusha, Tanzania, to discuss the endless demand for allowances by East Africa Legislative Assembly (EALA) MPs. High on the agenda seen by ChimpReports is the consideration of the facilitation for EALA meetings held through video conference.
DR Congo joining the East African Community (Independent)
Felix Tshisekedi has been busy on the regional integration front since he became president of the Democratic Republic of Congo two years ago. But he has particularly been busier this year. On June 16, Tshisekedi and President Museveni met at the border post of Mpondwe in the western district of Kasese to launch joint infrastructure construction projects. Museveni says Uganda’s footing of a substantial amount of money to construct the roads inside Congolese territory is aimed at boosting trade between the neigbouring countries. In April this year, Kenya and the DR Congo signed four framework cooperation agreements covering several economic sectors, security and defence as well as maritime transport. Among the four pacts, signed on the second day of President Uhuru Kenyatta’s three-day state visit to DR Congo, was the general cooperation agreement which provides a framework for joint promotion of economic, technical, scientific and socio-cultural programmes.
West Africa’s Eco currency plan remains a pipe dream (DW)
Since its conception in 2003, leaders of the fifteen-member Economic Community of West African States (ECOWAS) have postponed the launch of a single currency at least four times. ECOWAS leaders had set a goal of achieving a monetary and currency union by late 2020. However, the COVID pandemic and the failure of many countries to meet the criteria for launching the single currency precipitated the postponement to 2027. Jerry J. Afo Larbi, an economist and financial analyst told DW that for the Eco currency to be successfully launched, there must be a unanimous agreement between anglophone and francophone countries in the region. “Some countries believe their currency is stronger than the other. Therefore, this would complicate regional trade within the ECOWAS region,” Larbi added. “West African countries already don’t have a structured way of managing their banking and trade sectors. Therefore, I don’t see the Eco currency coming in place any time soon.”
How new tax regime will change Africa’s socioeconomic fortunes (The Nation Newspaper)
In the view of the African Tax Administration Forum (ATAF), the proposed new tax regime is an indeed a milestone. In a statement signed on behalf of the Secretariat by Mr Logan Wort, ATAF’s Executive Secretary, he said: “Due to the adoption by the Inclusive Framework of a number of the measures set out in the ATAF proposal, the new Pillar One rules are far simpler than the Blueprint proposals and will ensure that no member of the Inclusive Framework will be excluded from receiving its reallocation of profit under the so-called Amount A. The Pillar One rules are a step in the right direction in starting to address the issue of the current imbalance in the allocation of taxing rights between source and residence countries which deny source countries such as African countries of much-needed revenue. However, there is still much more that needs to be done to further redress that imbalance, and in partnership with the African Union, we are calling upon the Inclusive Framework to undertake further work on the tax allocation issue.”
African Development Bank’s new economic governance strategy advocates bold public finance reforms (AfDB)
The African Development Bank on Friday launched its Strategy for Economic Governance in Africa (SEGA), aimed at fostering transparent and accountable governments and institutions to secure inclusive, sustainable development. The strategy proposes bold reforms in the management of public finances to eliminate revenue ‘leakages’ and ensure an efficient, productive, and transparent use of scarce resources. The strategy document also outlines interventions to strengthen African governments’ domestic mobilization of resources, even as pandemic responses have increased debt levels and harmed economic productivity. Better governance is expected to enable countries to strengthen macroeconomic stability, foster a business enabling environment, and improve the efficiency of public spending and investments, according to the strategy document. SEGA will cover the 2021-2025 period.
Pushing agribusiness agenda (The Nation Newspaper)
The agricultural sector boasts of significant potential, but it also faces challenges due to several issues. One has been the impact of the COVID-19 pandemic which caused serious disruption to production activities last year and lack of financial and logistics that has made the country increasingly unable to satisfy its domestic market demands in staples. Currently, exports fall short of supply, causing some surplus production to go to waste, and those products that are exported, are shipped in difficult conditions, sometimes leading to spoilage. Analysts say attempts at reducing the import bill by increasing local milk production have been made with several obstacles, including lack of financial and technical to boost milk cattle breeding and local milk production, which would be a good step forward for the dairy industry. Hence, experts have been calling for the implementation of agric policy that is based on the sector’s comparative advantage and not just on excess production.
African tech reboots as investment roars back (African Business)
Africa’s tech sector is starting to bounce back as startups from all four corners of the continent raise $940m in tech deals so far this year, raising hopes of a return to the ground-breaking records of previous years. Most reports say that Africa is set to raise over $2bn this year, depending on the recovery from Covid-19 which is testing many countries in the form of a third wave. However, Africa has started the year well for tech deals and 2021 is expected to outperform 2020.
COVID-19: Africa plans a vaccine revolution (Deutsche Welle)
The challenges to building a dedicated vaccine infrastructure in Africa are immense. In addition to the usual difficulties such as financing and a lack of technical expertise, issues surrounding patent protection, which have been discussed for many months, have still not been resolved. It is also questionable whether the bulk of the projects currently being pursued in Africa will actually make the continent less dependent on pharmaceutical companies from the developed nations. According to AVMI Director Simon Agwale, most projects are filling plants that rely on the supply of raw materials by vaccine manufacturers. While this is welcome in principle, he says: “If there is not also investment in the production of the actual substances, we end up with countless filling plants, but no product that can be filled.”
How regionalism has helped Africa manage the COVID-19 pandemic (The Conversation)
Since March 2020, African countries have adopted various measures to manage the COVID-19 pandemic. Beyond the national responses were continental and regional approaches under the auspices of the African Union through the Africa Centres for Disease Control and Prevention and the regional economic communities. Regionalism was adopted as a strategy for many reasons. The first was the limited capacity of some states to manage the pandemic. A regional approach helped mitigate the negative effects of this weakness through mobilisation of resources and distribution of critical health equipment. The second reason was the fact that borders separating African countries are very porous, artificial and arbitrary. Third was the huge financial requirement for managing the pandemic.
Mainstreaming Gender in India-Africa Partnership for Energy Access (Observer Research Foundation)
Cooperation between India and African countries has expanded over the past several decades, and today, the two sides are partnering in manifold ways in the economic, political, and socio-cultural domains. One of these areas of partnership is energy, where initiatives have been mostly in the form of capacity-building. Both India and the African countries are working to achieve the seventh of the United Nations Sustainable Development Goals (SDGs), which aims to ensure access to affordable, reliable, sustainable and modern energy for all by 2030. In 2021, however, the ITEC lists only one course on Renewable Energy Technologies and there are no dedicated courses on energy access. India-Africa cooperation can improve solar electrification in both regions and ensure increased energy access to fulfil SDG 7.
How countries are faring on global goals amid COVID-19 (UNCTAD)
UNCTAD’s updated SDG Pulse, released on 2 July, shows how the COVID-19 health crisis exacerbated many imbalances in 2020 and delayed progress towards the 2030 Agenda for Sustainable Development. The pandemic hit hard structurally weak and vulnerable economies such as least developed countries (LDCs), landlocked developing countries (LLDCs) and small island developing states (SIDS), reversing hard-won socioeconomic gains. Consequently, 2021 has seen the rise of a new agenda for multilateralism calling for equal access to vaccines and resources to tackle the pandemic and ensure a more equitable economic recovery.
As trade declined in spring 2020, many governments imposed barriers to exports of medical products and lowered tariffs on imports of agricultural products to maximize the supply of critical goods to domestic markets. The resulting economic shock had many consequences. External debt, for one, grew to a record high in 2020 – reaching 31% of GDP in developing economies, according to the SDG Pulse. Flows of foreign direct investment and official development assistance to those in most need – the LDCs, LLDCs and SIDS – continued on a downward trajectory.
Longer TRIPS transition period for LDCs overlooks post-graduation challenges (The Daily Star)
On June 29, members of the World Trade Organisation (WTO) extended the deadline for Least Developed Countries (LDCs) to protect intellectual property under the WTO’s Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) until July 1, 2034. Members agreed to extend the present transition period, which was scheduled to end on July 1, by 13 years. The TRIPS Agreement that facilitates trade in knowledge and creativity, covers areas such as copyright, trademark, geographical indicators, industrial design, patents, layout designs of integrated circuits and undisclosed information. It may also be mentioned that the transition period for pharmaceutical products was earlier extended by the Council for TRIPS until the end of 2032.
However, WTO members did not agree to the LDC request for continuation of the transition period after a country graduates from LDC status to the developing country category. This is unfortunate since during the initial period after graduation, LDCs face challenges in terms of the loss of several international support measures. These include loss of preferential market access for LDC products in several developed and developing countries, access to concessional finance, TRIPS waiver, LDC-specific funds and technology transfer, among others.
The Global Trade Map After COVID-19: Where to for Global Companies and Investors, and Policymakers? (Observer Research Foundation)
In the wake of rising protectionism over the last half decade, the sudden economic stops wrought by COVID-19, the corollary disruptions of supply chain activity, and shocks to supply and demand, commentators from across the globe have trumpeted the ‘end’ of globalisation. With the shift from the old to the new economy – that is, growth in services activity and employment – experienced by many advanced economies (including the US, the UK, and the Netherlands), less goods – or volume of merchandise – are being moved around the world. This carries with it certain implications, as the manufacturing and industrial eras associated with the production of goods have significantly boosted national incomes within domestic borders. Additionally, competitive export of these goods to foreign markets has further contributed to both domestic as well as global economic growth. Looking beyond goods, cross-border exchanges of services (such as travel, IT, and legal and professional services), as well as flows of finance, and exchanges of human capital have been integral components of the globalised business landscape, critical for building business, profit, and generating returns. With the future of trade hanging in the balance, what’s in store for corporate executives and investors?
OECD-FAO Agricultural Outlook presents production, consumption, trade and price trends for the coming decade (FAO)
With less than 10 years until the 2030 deadline for achieving the UN Sustainable Development Goals (SDGs), governments need to step up their efforts to meet global food security and environmental targets, according to the OECD-FAO Agricultural Outlook 2021-2030. Productivity improvements will be key to feeding a growing global population – projected to reach 8.5 billion by 2030 – sustainably. Trade will continue to be critical for global food security, nutrition, farm incomes and tackling rural poverty. On average across the world, around 20 percent of what is consumed domestically is imported. Looking ahead to 2030, imports are projected to account for 64 percent of total domestic consumption in the Near East and North Africa region, while Latin America and the Caribbean region is expected to export more than a third of its total agricultural production.