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National
Clear understanding between govt, business needed to boost economic recovery – Mavuso (Engineering News)
Little can be done to drive an economic recovery without a clear understanding between business and government, says Business Leadership South Africa CEO Busi Mavuso, who joined other business representatives in a meeting with President Cyril Ramaphosa and his senior colleagues at the end of September. The meeting served to discuss what was needed to get South Africa’s economy back on track, with Mavuso saying it revealed a “close alignment on diagnosing the problems”.
Localisation master plan will hobble economic growth, says FMF (IT-online)
While increased industrialisation and manufacturing can spur economic growth and create jobs, the Free Market Foundation (FMF) maintains that enforced localisation master plans will only drive away the investment required for more manufacturing capability, and will subject both local and international businesses to more arbitrary, unpredictable government edicts and interventions. A 2021 study by Intellidex found that conditions in most industries are not yet right for blanket localisation and that input costs could be pushed up by 20%. To attain government-decreed localisation and designation goals of certain products, increased import tariffs will need to be imposed. These increased costs will ultimately be passed on to consumers, who are already under immense pressure, the study found. Further, localisation will not attain the 5% to 8% per annum growth that South Africa requires to alleviate the unemployment crisis. It is imperative that government not place yet more pressure on consumers by pursuing localisation at this time, the FMF believes.
IATA Proposes Three Interventions To Rebuild South Africa’s Tourism Industry & Create Jobs (IATA)
The International Air Transport Association (IATA) called on the South African government to step up its support for the air transport industry amid the COVID-19 crisis to facilitate the recovery of industries supported by aviation such as travel and tourism and unlock the job opportunities and other economic benefits they provide. “South Africa’s air transport and tourism sector’s contribution to GDP all but evaporated with the COVID-19 crisis which coincided with the closure of one airline and the deep restructuring of two others. In 2019 aviation supported 364,000 jobs in South Africa. Because of COVID-19, about 298,000 of those jobs have been put at risk. It’s a significant impact for over 80% of jobs to be lost if connectivity is not restored. As South Africa’s foreign trade and tourist markets begin coming back online, it is crucial that steps are taken to ensure no more jobs or opportunities are lost,” said Kamil Al Awadhi, IATA’s Regional Vice President for Africa and Middle East.
Kenya, Uganda third border post to boost trade (Business Daily)
Kenya and Uganda have endorsed the establishment of the third point of entry and exit at their common land boundary to boost cross-border trade. The neighbouring countries’ major crossings are Busia and Malaba borders along the Northern Corridor that links the Mombasa port in the Kenyan coast to Uganda, Rwanda, Burundi and the eastern Democratic Republic of Congo. Nairobi and Kampala officials Thursday consented to the setting up of a border post at Muluanda in Samia, Busia County to ease the movement of goods and persons.
US tech giants to profit from Kenya data in trade deal (Business Daily)
US tech giants are likely to increasingly mine and monetise data from Kenya if the proposed trade deal between Nairobi and Washington is successfully concluded, a United Nations agency has suggested. The United Nations Conference on Trade and Development (UNCTAD) says the proposed free trade agreement between the two countries includes digital economy as one of the key issues for negotiations. The objective, analysts at UNCTAD say in a fresh report, is to negotiate for inclusion of “state-of-the-art rules” in the trade deal which will not allow Nairobi to impose restrictions on cross-border data flows. The US is further pushing for removal of hurdles which require digital firms use or install local computing facilities.
Come and invest in Uganda, Museveni tells world (Daily Monitor)
The Dubai Expo is a globally recognised trade event and is this year expected to attract more than 190 countries, 12 months after it was beaten back by the Covid-19 outbreak.
The theme of Expo 2020 Dubai is “Connecting Minds, Creating the Future” with three (3) sub-themes of “Mobility”, “Opportunity” and “Sustainability.” Uganda is participating under the “Opportunity” sub-theme. Speaking at the event yesterday, President Museveni rallied investors from the United Arab Emirates (UAE), to take advantage of the resources and market the county’s beauty and potential in a bid to invite investors into the country.
Unexploited opportunities in Moza (Sunday Mail)
AS we enter the last quarter of the year, statistics that have been compiled so far show that Zimbabwe is witnessing an increase in exports. A recent trade outlook assessing and comparing the countries’ exports from January to June this year indicated that the month-on-month exports have grown by 3,2 percent, while year-on-year exports recorded a 35 percent increase. Available figures released by ZimStat show the country’s exports stood at US$2,52 billion, compared to US$1,86 billion recorded during the same period in 2020. Although there is a huge growth, exports are still dominated by minerals, an indication that more needs to be done to grow external trade of value-added products.
Nigerian insurers, others to increase involvement in AfCFTA (Nairametrics)
Nigerian insurers have stated their willingness to participate more actively in the African Continental Free Trade Agreement (AfCFTA). This is according to a consensus reached at the recent installation of Tope Smart, the Group Managing Director of NEM Insurance Plc, as the president of the African Insurance Organisation (AIO) at the organization’s annual conference, according to Punch.
Smart stated that he will spend his first year in office focusing on five primary goals aimed at repositioning the African insurance market. Increased awareness, digitalise action adoption, collaboration with other markets, partnership with government and regulators, and establishing customer trust are among the issues he mentioned.
AfCFTA: Rising shipping cost threatens Nigeria’s stake in $3.4trn continental market (Daily Sun)
Rising cost of importing goods especially raw materials for local production of goods meant for the African market may hobble Nigeria’s chances of maximising the potential of the Africa Continental Free Trade Area (AfCFTA) agreement. This is because beyond the high import cost freighting manufactured goods from Nigeria to other parts of Africa may still pose significant challenges with the absence of indigenous carriers. Presently, the cost of shipping 40ft container from China to Nigeria has doubled from $7,200 to about $14,700. This will definitely put Nigeria to disadvantage and could threaten its commitment to play a leading role in $3.4 trillion continental market.
Nigeria’s petroleum imports exceeded exports by $43.56bn –OPEC (Hellenic Shipping News)
The amount spent on the importation of petroleum products into Nigeria in 2020 is $43.46bn higher than the revenue which the country earned from the export of petroleum products in the same year. In its 2021 report on the latest values of cs and imports of member nations of the Organisation of Petroleum Exporting Countries obtained in Abuja on Friday, OPEC stated that Nigeria exported $27.73bn worth of petroleum products in 2020. It also revealed that the value of the country’s petroleum imports in 2020 was $71.285bn, which indicated that Nigeria’s petroleum imports exceeded its exports by $43.56bn during the review period. Further analysis of OPEC’s latest petroleum imports and exports’ figures showed that Nigeria’s imports of petroleum products consistently exceeded the nation’s exports for five years.
Djibouti Country Partnership Framework (CPF) (World Bank)
The World Bank Group’s 2022-2026 Country Partnership Framework (CPF) for Djibouti reflects the evolution of the WBG’s support to Djibouti toward a more selective engagement in line with the government’s development strategy. It aims to help Djibouti achieve its goal of reducing poverty through promoting inclusive private sector-led growth, job creation, and human capital; and strengthening the role and capacity of the state. Drawing on the analysis of the Systematic Country Diagnostic (SCD) and based on previous achievements, lessons learnt and consultations with a broad range of national stakeholders, the CPF looks into the country’s challenges and opportunities to support Djibouti’s potential for sustainable growth and meet the aspirations of its population.
Africa
African Free Trade Area Presents Opportunity and Obstacles Ahead (Global Trade Magazine)
The African continent is on the cusp of long-term economic opportunity thanks to the inception of the African Continental Free Trade Area (AfCFTA), which came into effect in January 2021. The AfCFTA could boost Africa’s growth potential as the agreement intends to liberalize trade across Africa over the next few years. It provides optimism for a region that has been hit hard by the pandemic. The impact of the pandemic has been uneven across African economies, with some suffering from severe economic contractions, while others managed to record small growth rates. The post-pandemic outlook differs from country-to-country, but most are subject to high uncertainty due to the rise in infections and the slow vaccination process. In the long run, the AfCFTA could be pivotal in Africa’s growth potential as the agreement foresees fundamental freedom of trade in Africa in the next few years. The agreement has the potential to accelerate African growth rates after the negative impact of the COVID-19 pandemic, according to a recent economic outlook report for the Sub-Saharan Africa (SSA) region from trade credit insurer Atradius.
How We Can Support African Countries – Afreximbank President (Leadership)
The President of the African Export-Import Bank (Afreximbank), Professor Benedict Oramah has said that the Bank has developed innovative products and means to support member countries in their diversification of sources of growth and trade, both at national and state levels. Afreximbank President had earlier outlined the new parameters of engagement with its member countries in a virtual presentation at the sixth edition of Kaduna Investment and Economic Summit (KADINVEST) which held on September 23. He listed ‘‘the Pan-African Payments and Settlements System (PAPSS) to facilitate the payment for cross-border trade in African currencies and reduce the costs of intra-African trade.” He also said that member countries can access ‘‘the Fund for Export Development in Africa (FEDA) to address the equity and long-term funding gap and attract FDI into Africa to accelerate the emergence of SMEs in supply chains.
The Private Sector’s Key Role In Accelerating The Implementation Of The AfCFTA (iAfrica)
Trade finance was already going through a digital transformation before the COVID-19 crisis. However, this trend accelerated as the digitisation of trade flows became essential to the continuity of the business. The crisis could be a catalyst to reshape the industry more quickly and profoundly than could ever have been anticipated, with implications for entire trading ecosystems. Digitisation is also a critical component to unlock the full potential of the African Continental Free Trade Area (AfCFTA). Reinforcing the capacity of African firms and entrepreneurs to trade easily within Africa’s borders and reach a global marketplace requires significant progress in Africa’s digital infrastructure, as well as a focus on regulations that protect and enhance digital trade.
Overcoming the deficit of infrastructure, which has been a major constraint to both economic growth and intra-African trade expansion, will become ever more critical during the implementation of the AfCFTA. Such an effort will include both physical and digital infrastructure, which, in the current fragmented African markets, have been major constraints to economic transformation and industrial production, as well as to the distribution of goods.
Big appetite for infrastructure needed to open up SA-African trade and investment, say experts (IOL)
The African Continental Free Trade Agreement (AfCFTA) will succeed only if there is a huge appetite for infrastructure investment to drive industrialisation, technological developments and large-scale manufacturing. This was among sentiments expressed by various speakers on Friday at the inaugural Africa Trade South Africa (ATSA) 2021 virtual conference. The conference was aimed at exploring South Africa-Africa trade and investment opportunities in relation to the AfCFTA. South Africa has historically been seen as an African powerhouse, and is poised to become a key player in the AfCFTA. However, Africa’s infrastructure investment gap has widened over time, and the Covid-19 pandemic made things worse in 2020, in spite of high demand for projects and a sufficient supply of capital and investors.
The fourth edition of the African Development Bank’s Africa Resilience Forum took place 28-30 September, with the theme ”Covid-19 and Beyond: Working Together for a Resilient Continent”. The Forum is a flagship African Development Bank platform that brings together thought leaders from government, civil society, the private sector, development partners, and academia, to promote state-building and peace initiatives across the continent.
During the opening ceremony of the Forum, African Development Bank President Akinwumi A. Adesina summed up the “hydra-headed challenge” confronting the continent: Covid-19, conflict and climate change. Over the three-day conference, sessions focused on various topics, and offered possible solutions. Themes included vaccine access, women’s entrepreneurship, youth unemployment, and the African Continental Free Trade Area (AfCFTA).
Coronavirus delays ECOWAS Regional Electricity Market Phase II implementation - ERERA (GhanaWeb)
The COVID-19 pandemic has delayed the implementation of Phase II of the ECOWAS Regional Electricity Market by two years, Professor Honoré Bogler, Chairman, ECOWAS Regional Electricity Regulatory Authority (ERERA), has said. He said, as a result, the Authority was working hand-in-hand with the West African Power Pool (WAPP) Secretariat, a cooperation of the national electricity companies in Western Africa, to try to launch the second phase of the project by the end of 2022 or at the beginning of 2023. “Because what COVID-19 brought to us is a delay of about two years and we are trying to catch up by fast-tracking things to get it done within the space of one year or one and half years,” Prof Bogler stated. He explained that the implementation of Phase II of the project would also depend on other conditions that were under COVID-19 consequences. Prof Bogler said this in an interview with the Ghana News Agency (GNA) on the sidelines of ERERA’s workshop on Fundamentals of Regulation and Introduction to the ECOWAS Regional Electricity Market for its network of communication experts at Akosombo in the Eastern Region.
Gas for Good: How Gas Can be Used for the Social and Economic Good of Africa (Proshare Nigeria)
Natural gas is increasing its share in Africa’s energy portfolio, with environmental ambitions, energy security and accessibility, as well as domestic energy independence comprising key drivers of growth. Despite global stakeholders and environmentalists negative perception of the resource, natural gas holds significant, and even critical, benefits for Africa, as energy poverty continues to be a major hinderance of meaningful economic growth. Speaking at the Gas Exporting Countries Forum (GECF) workshop on promoting natural gas demand on Wednesday, Akinwole Omoboriowo II, Chairman of the board of directors, Genesis Energy Holding, provided valuable insight into the role of gas in Africa. During his presentation, Omoboriowo II explained how natural gas can be used for the social good of Africa. With over 600 million without access to electricity across the continent, and with 13 million more people actually losing access in 2019-2020 due to the effects of the COVID-19 pandemic, any resource that can increase access and reduce energy poverty should be utilized. “In Africa we have two problems: the access problem and the availability problem. About 50% of African countries have electricity output levels that are below 50% of demand,” stated Omoboriowo II.
Yet, Africa has significant natural gas resources that, if leveraged, could sufficiently meet demand, increasing access to electricity and driving associated socio-economic growth.
The Republic of Mauritius deposits the instrument of ratification of the African Medicines Agency (AMA) | African Union (African Union)
On 30 September 2021, the Republic of Mauritius became the thirteenth (13th) member state to deposit the instrument of ratification of the African Medicines Agency (AMA). The country signed the Treaty on the 21 September 2021 in Addis Ababa and ratified the same day in Port Louis, Mauritius. The Ambassador of Mauritius to Ethiopia and the African Union H.E. Mr. Dharmraj Busgeeth deposited the instrument of accession to H.E. Amira Elfadil Mohammed, Commissioner for Health, Humanitarian Affairs and Social Development, at the AU Commission. The Commissioner underscored that establishing the AMA was an urgent matter due to the ongoing COVID-19 pandemic. “AMA will play an important regulatory role, encourage local production of medical products and align regulatory policies on the continent, taking advantage of the opportunities brought about by the African Continental Free Trade Area (AfCFTA),” the Commissioner added.
China’s trade with Africa grows to record highs (Africa Feeds)
According to China’s Ministry of Commerce, trade between China and Africa increased by 40.5 percent year-on-year in the first seven months of 2021, and was valued at a record high of USD 139.1 billion. The Ministry noted that African products were increasingly being recognised in the Chinese market, and that imports from Africa into China increased by 46.3% between January and July 2021. Further, the import of agricultural products, such as rubber, cotton and coffee from Africa into China doubled when compared to the first seven months of 2020. Data from the Ministry further revealed that over the last 20 years, China’s trade with Africa has risen 20-fold, showing that China is Africa’s biggest bilateral trading partner.
International
Global trade rebound beats expectations but marked by regional divergences (WTO)
The WTO is now predicting global merchandise trade volume growth of 10.8% in 2021—up from 8.0% forecasted in March—followed by a 4.7% rise in 2022 (Table 1). Growth should moderate as merchandise trade approaches its pre-pandemic long-run trend. Supply-side issues such as semiconductor scarcity and port backlogs may strain supply chains and weigh on trade in particular areas, but they are unlikely to have large impacts on global aggregates. The biggest downside risks come from the pandemic itself. Behind the strong overall trade increase, however, there is significant divergence across countries, with some developing regions falling well short of the global average.
This is the current state of global trade (World Economic Forum)
International trade is the lifeblood of the world economy, providing the goods and services that are traded across borders to bring wealth and prosperity to nations. But how exactly does it work? Emerging economies have seen their share of total global trade rocket in recent years. China, for instance, is now responsible for 15% of all world exports. Unfinished goods, components and services account for 70% of all trade. While trade in services accounts for two-thirds of global GDP, COVID-19 has had a devastating impact on trade patterns.
Public Forum reflects on need to strengthen collective action towards sustainable trade (WTO)
In a session organized by the Pew Charitable Trusts and International Institute for Sustainable Development (IISD), participants discussed what a potential WTO fisheries subsidies deal would mean to sustainable development and why it matters for the oceans and for trade. A successful WTO agreement on curbing subsidies for overfishing could pave the way for a stronger multilateral trading system and open discussions of how its implementation will be a catalyst for sustainable trade and a sustainable future.
IEA implores countries to help lower the production cost of hydrogen (Engineering News)
The International Energy Agency (IEA) reports in its ‘Global Hydrogen Review 2021’ report, released on October 4, that although investment is increasing in hydrogen projects to support a clean energy transition, further efforts are needed to reduce costs and encourage wider use across sectors. As such, the agency says governments need to move faster and more decisively on a range of policy measures to enable low-carbon hydrogen to fulfil its potential to help the world reach net-zero emissions, while also supporting energy security.
