tralac Daily News
Trade Statistics for September 2021 (South African Revenue Service)
The South African Revenue Service (SARS) today releases trade statistics for September 2021 recording a preliminary trade balance surplus of R22.24 billion. These statistics include trade data with Botswana, Eswatini, Lesotho and Namibia (BELN). The year-to-date (01 January to 30 September 2021) preliminary trade balance surplus of R352.21 billion is an improvement from the R167.60 billion trade balance surplus for the comparable period in 2020. Exports increased by 16.3% year-on-year whilst imports increased by 31.9% over the same period.
Value addition plants key to rural development (The Herald)
For a long time value addition has been part of Zimbabwe’s development language, embedded in major economic blue print and both short and long term goals. But slow action and implementation emptied the true meaning of value addition and the ability of the government to deliver on the aspirations of rural people. In short, value addition policies were wrapped in development language that was comforting and full of ‘feel-good’ rhetoric that had no practical evidence on the ground. But now, things are changing and there is a significant difference on the ground and achievements in policies and actions on value addition plants in rural areas are being accorded greater attention.
Kenya to gain as US restricts Ethiopia goods on Tigray war (The East African)
Kenya looks set to benefit after the US suspended duty-free access to Ethiopian exports following ongoing unrest in the country’s Tigray region. The US move to ban Ethiopia opens a window for Kenyan textile and apparel firms to increase their exports to the US market of more than 6,000 product lines as US restrictions hit their Ethiopian rivals.US authorities said Ethiopia had breached the eligibility requirements of the African Growth and Opportunity Act (Agoa) because of “gross violations of internationally recognised human rights” a US official was quoted by reports saying. Kenya’s total exports to the US under the Agoa plan peaked at Ksh46 billion ($412.5 million) in 2019, before declining eight percent to Ksh42.2 billion ($378.5 million) in 2020, according to the Economic Survey data. On the other hand, Ethiopia exported about Sh26.3 billion worth of goods duty-free to the US under Agoa last year, US commerce department data shows.
September 9, 2021 was a milestone date for Tanzania as it became the 39th country in Africa to deposit its instrument of ratification of the African Continental Free Trade Area (AfCFTA). The other East African Community (EAC) member countries of Kenya, Rwanda, Uganda and Burundi had ratified the agreement earlier, and - with Tanzania now on-board - only South Sudan that has not ratified the agreement. The relevance of ratification is that it is the necessary legal instrument for a country to be bound to an international agreement. In particular, much as an international agreement may have entered into force, it binds only those states that have consented to be bound by it. In the context of AfCFTA: what does consent imply? What have we committed ourselves to? In brief, it is a consent to liberalise 90 percent of tariff lines, meaning that Tanzania will reduce, and ultimately eliminate, tariffs on 90 percent of products traded under the AfCFTA. Much as Tanzania’s categorisation as one of the Least Developed Countries (LDCs) is not a source of pride, at least it comes with the advantage of a longer (10-year) period to accomplish this; by contrast, non-LDCs have a five-year period.
The commitment is also not absolute in the sense that Tanzania can provide a list of sensitive products capped up to seven percent of tariff lines, which will be fully liberalised over an even longer period of time - namely 13 years (while non-LDCs are provided with 10 years). In addition, 3 percent of tariff lines will be excluded from tariff liberalisation.
Tanzanian authorities said on Wednesday a total of 182 investment projects worth 3.5 billion U.S. dollars were registered in the east African nation between April 2021 and October 2021. Geoffrey Mwambe, the Minister of State in the Prime Minister’s Office responsible for Investment, said 164 of the 182 investment projects were registered by the Tanzania Investment Center (TIC) and 18 projects were registered by the Export Processing Zone Authority (EPZA).
Mwambe attributed the impressive flow of investment projects to measures aimed at improving the investment environment being undertaken by President Samia Suluhu Hassan’s administration.
ZIMBABWE seeks to benefit from the experience of Seychelles in the tourism sector as part of bilateral and trade cooperation between the two countries. Ambassador David Hamadziripi, who is also Zimbabwean Ambassador to South Africa, said this recently after presenting his credentials to Seychelles President Wavel Ramkalawan at that country’s State House, Victoria. He becomes the first Ambassador of Zimbabwe to Seychelles. “Zimbabwe is also a very attractive tourist destination. Even if we offer a different package altogether, we can still benefit from the experience of Seychelles in marketing, training and other related areas in the tourism sector,” said Amb Hamadziripi.
many poor countries that have so far contributed very little to global CO2 emissions are particularly vulnerable to rising temperatures and increased droughts, fires and floods linked to climate change, which threaten food security and exacerbate water scarcity.
If poor countries are asked to give up fossil fuel production, experts say their wealthy counterparts need to spend trillions of dollars to develop solutions that both spur economic development and protect the planet. If that doesn’t happen, the global poor may be left behind in the energy transition.
“We have enormous reserves of gas in Nigeria and we need to be able to tap into those resources to develop the Nigerian economy,” Ajayi told CNN Business, adding that alongside power generation, gas will also be crucial to developing industries such as petrochemicals and fertilizers.
The Director General of the World Trade Organisation (WTO), Dr. Ngozi Okonjo-Iweala, has applauded the stability of the Nigerian banking sector citing it as a catalyst to the recovery and development of the country. She also noted that the emergence of innovations in financial technology (FinTech) would continue to play a role in the stability and growth of the banking sector.
“Nigerian’s banking sector has contributed immensely to the development of the country but there is still so much to be done. And our financial services industry, including the emerging FinTech sector, as a stronghold to play. “The theme of your deliberation regarding Nigeria’s debt profile and its implications for sustainable development is a very important one. If there is a group that has the necessary professional insight on issues of debt, and debt, sustainability be it at the individual, institutional or national level, it is you.”
The Nigerian Communications Commission (NCC) and other telecoms regulators under the auspices of West African Telecoms Regulators Assembly (WATRA), are set to develop technical and regulatory modalities, aimed at combating rising wave of electronic frauds, and standardising regional roaming tariffs in the sub-region.
The meeting, which was attended by representatives of telecoms regulators from countries across West Africa, provided a platform for key participants and stakeholders to deliberate on building a unified market in telecommunications services in West Africa, to combat roaming and cyber-related frauds, and achieve the standardisation of roaming tariffs among ECOWAS member-states.
“About 75 per cent of trade within ECOWAS is informal, and thus poorly recorded. Therefore, digitising this trade through employing many forms of electronic payments is a significant step towards formalising, governing and boosting intra-ECOWAS trade activities. Our ambitions are to formalise informal trade, including agricultural commodities as well as boosting intra-regional trade and this requires us to improve collaboration on combating electronic fraud,” said Executive Vice Chairman of NCC, Prof. Umar Garba Danbatta, who is also the Chairman of WATRA.
State attaches special importance to enhancing role of WTO (Egypt State Information Service)
Minister of Trade and Industry Neveen Gamea asserted that the Egyptian state attached special importance to enhancing the role of the World Trade Organization (WTO) which is a cornerstone of the multilateral world trade movement. She expressed Cairo’s backing for Arab efforts to reach tangible results for the sustainable development at the 12th ministerial conference of WTO (MC12), due to convene on November 30 till December 3 in Geneva.
Algeria to halt gas exports to Spain via Morocco (Africanews)
Algerian President Abdelmadjid Tebboune on Sunday ordered state energy firm Sonatrach to halt gas exports to Spain through a pipeline that traverses Morocco due to tensions with Rabat. Algeria, Africa’s biggest natural gas exporter, has been using the Gaz-Maghreb-Europe (GME) pipeline since 1996 to deliver several billion cubic metres (bcm) per year to Spain and Portugal. But the GME contract is due to expire at midnight Sunday, just over two months after Algiers severed diplomatic ties with Rabat over “hostile actions” -- accusations Morocco has dismissed.
Morocco’s trade deficit up 25.5 pct in Sept. (China.org.cn)
Morocco’s trade deficit increased by 25.5 percent year-on-year to 151.84 billion dirhams (about 17 billion U.S. dollars) by the end of September, the Moroccan foreign exchange regulator said Tuesday. Morocco’s exports reached 230.43 billion dirhams (about 25.34 billion dollars), up by 22.1 percent year-on-year, while the imports rose by 23.4 percent to reach 382.27 billion dirhams (about 42.04 billion dollars), the Exchange Control Office was quoted by the Moroccan News Agency (MAP) as saying in a release.
The question is, are African countries harnessing this potential offered by the AfCFTA? According to the African Development Bank (AfDB), intra-Africa exports amount to only 16.6% of total trade.
The agreement promotes socio-economic growth and development in Africa through liberalised trade processes and structures. So far, the 54 African countries have signed the agreement, resulting in immense potential for the growth of trade between African countries. In fact, it has been hailed as perhaps the “most ambitious free trade project since the creation of the World Trade Organization itself” by Martyn Davies, the managing director of Emerging Markets at Deloitte Africa.
“It is imperative that we decisively deal with operational constraints and Non-Tariff Barriers which negatively affect the performance of the cross-border transport system and in the corridors linking the COMESA-EAC-SADC tripartite and beyond,” said Mr. Mboyi. He added: “As we do this, we must aim to ensure that cross-border road transport operations are underpinned by firstly, a harmonised regulatory environment and secondly; a predictable operating environment,” said Lwazi Mboyi, the Acting CEO of the Southern African Cross-Border Road Transport Agency (C-BRTA),
AfCFTA: Adoption of eNaira as driving force (New Telegraph)
Recently, Nigeria adopted the Central Bank’s Digital Currency (CBDC) otherwise known as eNaira in supporting blockchain technology innovation. For the feat, the Manufacturers Association of Nigeria (MAN) and other private sector operators agree that the digital currency is needed to play a role in trade and exchange during AfCFTA implementation.
The African Continental Free Trade Area (AfCFTA) agreement has been the much talked about issue in recent time in the continent. However, Nigeria’s part has been peculiar because members of the organised private sector have been raising concerns about Nigeria’s preparedness, since the basic social amenities (infrastructure) needed to accelerate growth and development are not in place. Nigerian manufacturers are insisting that, no doubts, for Nigeria to remain a big player in Africa, a digital currency is needed to play a role in trade and exchange. Therefore, they are suggesting that adopting and keying into blockchain technology to drive business, regulatory and governance processes are needed by Nigerians in the private and public sectors. The private sector operators said blockchain could potentially contribute up to $29 billion to Nigeria’s GDP (gross domestic product) by 2030, if well harnessed and with eNaira being at the front burner of Nigeria’s economy.
The 2nd Annual Africa Supply Chain in Action (ASCA) conference saw hundreds of African supply chain and procurement professionals from 30 countries gather online to examine what Africa has learned from COVID-19, how businesses and the supply chain profession can collaborate and innovate to ensure post-pandemic prosperity, and how supply chains can drive economic growth and success now and beyond the pandemic. Now in its second year, ASCA is the largest Africa-focused online learning, knowledge sharing and networking event for the profession.
“Covid-19 has disrupted our social and economic order at lightning speed and on a scale that we have not seen in living memory. We must marshal the determination of all - individuals, governments, businesses, and more specifically the supply chain and procurement community - to act decisively, ethically, and to act together, to protect lives and livelihoods,” said Pearl Marsh, Head of Content at Smart Procurement, at the opening of ASCA 2021.
In his powerful keynote presentation, Africa Business Group CEO Michael Sudarkasa discussed how the “prosperous Africa that we want” cannot be achieved without collaboration. He noted that Africa has fared better than many regions amid the COVID crisis. “We have a growing youth workforce, set to reach 830 million by 2050. We have a growing middle class and consumer market. The rapid expansion of mobile phone technology is enabling growth in financial technology and agricultural technology. The growing number of African women working outside the home has created opportunities in the agricultural processing space and is contributing to GDP growth. The pandemic slowed local and international travel, but despite that, we are seeing accelerated intra-African travel.”
Support for small businesses keen to trade across the continent’s single market is being eyed as a potentially lucrative market by more and more African fintech startups. Africa’s fintech startups are rapidly expanding beyond their host countries’ borders to tap into the anticipated surge in trade and investments with the opening up of the world’s largest single market, the African Continental Free Trade Area (AfCFTA).
In the last month alone, a number of startups have either raised growth funds, acquired another player present in regional markets within the same vertical, or tapped top talent in the telecoms industry. Their intention appears to be the targeting of small industries and traders seeking cross-border opportunities in new African markets.
The United Nations on Wednesday launched a new finance mechanism aimed at saving African governments $11 billion in borrowing costs in the next five years, while fostering greener investments and sustainable development. The U.N. Economic Commission for Africa (UNECA) launched the Liquidity and Sustainability Facility (LSF) at COP26, the global climate conference underway in Glasgow, Scotland. International investors with portfolios containing African government bonds will be able to approach the LSF for short-term loans, known as repos, using the bonds as collateral, enhancing investors’ ability to turn those bonds into cash at short notice, known as liquidity. This would make the bonds less risky and therefore more attractive to a wider range of investors. African governments would then benefit from more demand and enhanced liquidity for their bonds, as well as cheaper financing costs. The LSF said it could potentially save African governments up to $11 billion in borrowing costs over the next five years.
Africa Must Lead on Capital Flight by Carlos Lopes & Ricardo Soares de Oliveira (Project Syndicate)
The Pandora Papers, the largest investigative effort yet to shed light on the world of offshore finance, show just how serious the challenge of illicit financial flows is for Africa. The papers reveal that many prominent Africans hold assets in major financial centers abroad with the help of professional enablers who provide them with secrecy, ensure asset protection, and secure tax exemptions.
Some African initiatives demonstrated early leadership in assessing the issue and developing potential solutions. The African Tax Administration Forum, which was created in 2008 and includes 38 African states, has been a noteworthy actor on tax reform issues. The High-Level Panel on Illicit Financial Flows from Africa, a joint effort of the African Union and the United Nations Economic Commission for Africa, first convened in 2012 and produced a much-discussed report on the subject in 2015. At that time, it seemed offshore finance would be a regular part of African Union discussions. Unfortunately, it is disappearing from the agenda.
there is no multilateral African body leading the way on the problem, and the African organizations that were working on it actively five years ago have assumed what can only be described as a low profile. It is hard to avoid the sense that many of the continent’s rich and powerful have little incentive to compromise arrangements that have enabled them to move, hide, and protect their assets. Moreover, their lawyers and financial advisers point out that many such practices are not only legal, but common among multinationals active in Africa, especially in the extractive industries. According to this logic, there is no reason Africans should not avail themselves of strategies that are widespread in the global financial system. This lack of concern by African states over illicit finance is bolstered by the perception that in most countries, most of the time, tax evasion is not a matter that registers with public opinion. At best, leaders assume that any effect the issue has on public trust can be managed. They are certainly wrong, especially regarding younger voters, but this view shapes their non-committal approach.
Dr. Mikuriya also highlighted the WCO capacity building initiatives for its Members, namely regional workshops as well as global conferences such as the WCO TECH-CON that helps to bring together the private sector and Customs to discuss the use of new techologies. He added that technologies also help to improve methodologies and capacities of Customs operations through smart solutions in documentation processing, cargo inspection and cargo tracking.
The consequences of Covid-19 will be felt for years to come, but it is clear already that multinational companies and investors are turning their attention back to the world’s youngest continent – and with good reason. Speaking at EY’s Africa Tax Summit 2021 which was held last week, Larry Eyinla, EY Africa Tax Leader, said: ”Investors have for years followed Africa’s notable and durable demographic trends. And now as Covid is hopefully receding they are once again focusing on Africa’s distinctive appeal which has been brought into stark relief by the pandemic. “In the coming decades Africa will be the world’s only source of a growing labour forces and consumer bases. It is the world’s youngest continent, and stands out in a world of ageing and shrinking populations.” He added the big question for Africa post COVID is where it lands in the global reset.
The Bank’s High 5 priorities involve lighting up and powering Africa, feeding the continent, industrializing Africa, integrating Africa, and improving the quality of life for the people of Africa. Adesina was delivering a lecture last Thursday at the 21st NECCI Public Relations Roundtable on Social Media, National Security and Social Change in Lagos. He said the African Development Bank was investing heavily in quality infrastructure to transform the backbone of Africa’s technological revolution. The Bank president said: “We are a people-centred bank – a solutions bank for Africa, and our efforts are being recognized globally…The African Development Bank has maintained its stellar AAA rating by the major global credit rating agencies for the past six years. Since I was first elected president of the African Development Bank six years ago, together with our partners, we have made a difference in the lives of 335 million people across the continent.”
East Africa’s economic growth is expected to recover to an average of 4.1% in 2021, up from 0.4% posted in 2020, according to the African Development Bank’s latest economic outlook report for the region. In 2022, average growth is projected to hit 4.9%. The flagship report, launched on 28 October, reviews the socio-economic performance of 13 countries: Burundi, Comoros, Djibouti, Eritrea, Ethiopia, Kenya, Rwanda, Seychelles, Somalia, South Sudan, Sudan, Tanzania, and Uganda. According to the report’s findings, Covid-19 containment measures and global supply and demand disruptions hit businesses and livelihoods hard and increased poverty, while political fragility in some countries and limited economic diversification in others were significant impediments to growth. The report, themed Debt Dynamics in East Africa: The Path to Post-Covid Recovery, notes that the rapid recovery of the region is being driven by sustained public spending on infrastructure, improved performance of the agricultural sector, and deepening regional economic integration.
External debt: Tunisia has highest rate in North Africa in 2020 (AfricanManager)
Tunisia’s external debt accounted for 97.2% of GDP in 2020, the highest rate in North Africa, according to the estimates of the 4th edition of the report “North African Economic Outlook 2021 / Debt Dynamics: the path to recovery Post-COVID”, published by the African Development Bank (AfDB). The report presented at a webinar held Wednesday highlights that Tunisia remains more vulnerable to exogenous shocks than other North African countries due to its heavy dependence on external debt, which increased by 42.4 points between 2012 and 2020.
As for public debt, the bank warns that it will become “unsustainable” if Tunisia does not undertake solid and credible reforms with broad domestic support.
To improve public debt management and strengthen domestic resource mobilisation, Audrey Verdier-Chouchane, regional economist for North Africa, emphasised the need to put in place mechanisms and institutions to balance the benefits and costs of additional debt. She also called for better debt transparency and careful monitoring of contingent liabilities, emphasising the need to restructure state-owned enterprises and to use debt effectively to finance productive investments.
‘How agro-allied companies can lower food prices’ (The Guardian Nigeria)
To address the challenges of rising food prices across the country, more players in the agri-food system need to increase their investments in homegrown innovation and local production of raw materials, stakeholders have said. Speaking at the sub-summit of the recently concluded NES, which had its theme as: Sustainable Food Security and Systems Response, the group managing director of Flour Mills of Nigeria, Omoboyede Olusanya stressed the need to increase local supply of raw materials to enhance food security. He said innovation of local raw materials further drives investments in backward integration.
China – Africa: Will the new Covid-19 wave affect trade with the continent? (The Africa Report)
While global trade experiences unprecedented disruptions of major supply chain networks, that turbulence does not appear to have had much effect on the volume of Chinese trade with African countries, at least so far. Chinese customs authorities announced last week that two-way trade for the first eight months of the year totalled $162.7bn, 40% higher than the same time last year. At this pace, bilateral trade between China and African countries is on track to easily exceed the $187bn the two regions did in 2020.
COP 26 updates
African and other global leaders came together at COP26 in Glasgow yesterday for the Africa Adaptation Acceleration Summit, the largest summit to date on climate adaptation. The summit called for the rest of the world to ramp up its support for the African continent as it adapts to the adverse effects of climate change, including devastating human impacts in Madagascar, where 1.3 million people live under food distress following four years of no rain.
President Félix Tshisekedi of the Democratic Republic of Congo and Chairperson of the African Union led Tuesday’s event. He highlighted the $6 billion in financial commitments for climate adaptation that African countries had put forward in their nationally determined contributions (NDCs) and called for increased funding to produce the additional $27 billion a year that the continent requires.
President Tshisekedi said: “Adaptation finance flowing to Africa is grossly insufficient compared to the enormous resources needed for the continent to adapt to climate change. That is why African countries, working with the Global Center on Adaptation, the African Development Bank, and other partners, launched the Africa Adaptation Acceleration Program (AAAP). The program lies at the heart of Africa’s climate change needs. It is Africa-owned and Africa-led. African nations have endorsed it as Africa’s preferred mechanism to deploy adaptation finance for adaptation projects in Africa.”
What did African leaders call for at COP26’s opening ceremony? (Quartz Africa)
During the first two opening days of COP26 in Scotland, over 25 African leaders took center stage to demand climate justice and greater support from richer nations. African leaders demanded wealthy countries make good on their pledge to deliver $100 billion a year in climate finance to developing countries – a commitment made at the UN climate talks in 2009. A report recently announced they would not be able to meet this target until 2023. Between 2016 and 2018, only 25% of the money promised to developing nations went to Africa. While the continent is responsible for just 3% of global emissions, it remains the most vulnerable region to global warming. For example, Madagascar has been hit by one of the modern world’s first climate change-induced famines, yet the island country produces a little more than 0.01% of the world’s annual carbon dioxide emissions.
A recent report showed lower income countries spend five times more on debt to rich nations than coping with the impact of climate change. Several African leaders lamented high debt payments which are hindering adaptation efforts. “Due to high debt servicing, we lack the fiscal space to scale up investment in climate change action,” said Julius Maada Bio, the president of Sierra Leone. He added that Africa has access to less than 5% of global climate financing streams, while Moeketsi Majoro, Lesotho’s president said “access to global climate finance mechanisms remain effectively shut.”
Several stressed finances should come in the form of grants and not loans, and should be directed towards adaption – not mitigation.
African leaders and campaigners are pressing the international community to do more to help poorer and vulnerable nations adapt to climate change, seizing on evidence showing the continent to be the most endangered by the effects of global warming. The head of the African Union, Congolese President Felix Tshisekedi, said other parts of the world must contribute half of the $25 billion the continent needs to run an adaptation program over the next five years. The balance will come from the African Development Bank. Tshisekedi spoke Tuesday before an Africa-focused summit at the U.N. climate conference in the Scottish city of Glasgow. He was one of several leaders who highlighted Africa’s plight in the face of climate change despite being the populated continent least responsible for global emissions.
Tshisekedi noted that the global effort on climate change “can’t be won unless it is won in Africa,” which is home to 1.3 billion people. Africa’s 54 nations contribute only about 3% of global emissions, a fact that surprises some ordinary Africans when they find out.
Despite contributing little to climate change, Southern Africa is among the worst-affected regions globally. And those who are bearing the brunt are the ones with the least resources to adapt. The region’s governments have not prioritised adaptation measures such as early warning systems, climate-resilient infrastructure, dryland agriculture, mangrove protection, and resilient water sources. And the costs of these measures are rising far faster than funding is being provided. As COP26 kicks off this week, countries in the region must raise funds and increase adaptation planning efforts. The World Food Programme has called Southern Africa the ‘epitome’ of the link between climate and the water-energy-food nexus. The 16 Southern African Development Community (SADC) states have recorded 36% of all weather-related disasters in Africa in the past four decades. These affected 177 million people, left 2.7 million homeless and inflicted damage in excess of US$14 billion. Climate change will continue to increase the frequency, intensity, duration and locations of these slow- and sudden-onset impacts.
Priorities for Africa at COP26 and beyond (Africa Renewal)
Climate finance, technology transfer and capacity building are indeed the priorities that are being put forward to COP26. The finance conversation is a big one because it is, in a sense, the prerequisite for many of the other things to happen, including technology transfer. The mobilisation of finance to tackle climate change, particularly for adaptation, is as urgent as ever. African advocacy to ensure that previous commitments are honoured will be critical. Ultimately, we cannot divorce the climate resilience agenda from the development agenda. We cannot have one without the other. However, the biggest missing piece in the puzzle is up-front financing.
While its contribution to greenhouse gas (GHG) emissions is very low, Africa is highly vulnerable to climate change. The conclusions of the Africa chapter of the 4th IPCC Assessment Report are clear: Africa’s major economic sectors are suffering huge economic impacts from climate change and the situation is exacerbated by endemic poverty, governance shortcomings, limited access to capital, infrastructure and technology, ecosystem degradation and complex disasters and conflicts. Current autonomous adaptation by African farmers will not be sufficient to face growing drought stress in wide areas of the continent, and agricultural production and food security are increasingly compromised in several African countries. Climate change will aggravate the existing water stress situation and have detrimental impacts on human health. These examples are an illustration of the threat that climate change represents for the achievement of Sustainable Development Goals (SDGs) across. .
Even if the target of the PA is reached and the global temperature increase is kept within 2°C above preindustrial levels, the cost of adapting to climate change across Africa is estimated to reach $ 50 billion a year by 2050. However, global finance for adaptation in 2030 would need to be approximately 6 to 13 times higher than international public finance in 2016 to avoid an adaptation gap. Mobilising new finance, especially from private sources, will be crucial for ensuring an adequate level of adaptation
Natural gas remains key to Africa’s energy security and economic prosperity, even as political pressure grows to speed up the transition away from fossil fuels, according to the continent’s biggest development bank. “Gas is fundamental to Africa’s energy system,” African Development Bank President Akinwumi Adesina said in an interview with Bloomberg News on Wednesday. “We’ve got to make sure that we’re pragmatic” and that a system is created to support long-term development, he said. While natural gas is less polluting than other fossil fuels such as coal and oil, some environmentalists want to end its use because the industry is responsible for methane that has far more planet-warming power than carbon dioxide.
Even if Africa tripled its natural gas output, it would add under 1% to its less-than 3% contribution to global greenhouse gas emissions, said Adesina. The world needs to “be fair to Africa” because the continent needs to industrialize and create jobs which requires a stable energy supply, he said.
President Uhuru Kenyatta has announced Kenya’s plan to work with African countries that form the ‘Giants Club’ conservation group to raise resources for investment in the continent’s climate change mitigation programmes. The president said that the plan will create opportunities for the private sector to invest in the restoration of Africa’s carbon sinks including forests, and ensure that governments and host communities reap maximum benefits from climate change mitigation interventions.
“Restoring and protecting these carbon sinks can help also create hundreds of thousands of critical green jobs, drive enterprises away from destructive forms of land use, can help us tackle poverty, combat illegal wildlife trade and also prevent future pandemics, and ensure that the diversity of life on which we all depend continues to endure,” Uhuru said.
The ECOWAS is developing a new climate strategy, specifically designed to improve its coordination of climate action in West Africa. “Because coordinated regional action has more impact than the addition of national policies alone, ECOWAS has been working throughout 2021 to develop a Regional Climate Strategy,” reads a press release issued by the institution on November 1. “This strategy will contribute to strengthening the region's resilience to the impacts of climate change, in particular through support for the implementation of the commitments made by its Member States under the Paris Agreement,” it adds
Global finance ministers gather to discuss how public and private finance can lead the transition to a net zero, climate resilient world (UN Climate Change Conference UK 2021)
Finance Ministers, International Finance Institutions and the financial sector are meeting at COP26 today to get global finance flowing for climate action. Mobilising finance is critical if we are to deliver the urgent action we need to limit global temperature rises to 1.5C. Trillions of dollars of additional investment a year are needed to secure a low-carbon future and support countries already living with the devastating impacts of climate change.
Countries made new commitments to increase finance to support developing countries to deal with the impacts of climate change, including a commitment from Norway to triple its adaptation finance, commitments from Japan and Australia to double their adaptation finance, and commitments from Switzerland, the US and Canada for the Adaptation Fund.
Demonstrating the direct benefits of what public climate financing can achieve: leaders from South Africa, the United Kingdom, the United States, France, Germany and the European Union yesterday announced a ground-breaking partnership to support South Africa with an accelerated just energy transition.
Transboundary climate change and adaptation risks (TCAR) that can affect agricultural value chains were perceived as in Africa, according to a new report. TCARs are climate and adaptation risks that result from climate change events that flow beyond national borders. They can spread in the following ways: Biophysical Financial (the flow of capital) Trade People Geopolitical (laws and policies around movement, regional cooperation and border sovereignty)
Biophysical pathway refers to transboundary climate risks that manifest through alterations to flow within biophysical systems such as river basins, arid lands or oceans. The trade pathway refers to transboundary climate risks that manifest through disruptions to the price, quality and availability of goods and services on international markets and supply chains.
The chairman of the group of the poorest countries said COP26 climate talks have so far been disappointing, and even “frightening.” “The progress made here is disappointing and in a way also frightening,” Sonam Phuntsho Wangdi, who chairs the so-called Least Developed Countries group, told reporters in Glasgow, Scotland. He called for additional funds to be made available for countries suffering from damage resulting from climate change. World leaders unveiled a series of pledges during a two-day summit in Glasgow, though much of what has been announced isn’t binding and doesn’t include some key emitters. When talks started, the world was on track for 2.7 degrees Celsius of warming -- a scenario that poses an existential threat to many nations.
As pressure mounts for urgent climate action, UN Secretary-General António Guterres today issued a global roadmap to achieve a radical transformation of energy access and transition by 2030, while also contributing to net zero emissions by 2050.
The roadmap sets an aggressive timeline to ensure that 500 million more people gain access to electricity in a mere four years’ time, by 2025, and 1 billion more people gain access to clean cooking solutions. This would require that annual investment in access to electricity and clean cooking increase to US$ 35 billion and US$ 25 billion, respectively. The required investment represents only a small fraction of the multi-trillion-dollar global energy investment needed overall, but would bring huge benefits to one-third of the world’s population.
The global roadmap is a major outcome of the UN High-level Dialogue on Energy held on 24 September, at which over 130 Heads of State and Government and global leaders from business and other sectors announced over $400 billion in new finance and investment for clean energy as part of voluntary commitments called Energy Compacts.
The WTO Secretariat has published five information briefs on trade, climate and related issues in support of efforts to harness trade policy as part of the solution for effective and just climate action.
The World Meteorological Organization (WMO), the UN Development Programme (UNDP), and the UN Environment Programme (UNEP) have signed a Memorandum of Understanding to legally establish the Systematic Observations Finance Facility (SOFF) as a UN Multi-Partner Trust Fund. SOFF will address the problem of missing weather and climate observations from Least Developed Countries and Small Island Developing States. SOFF will seek to fill data gaps that limit our understanding of the climate, and to thereby enhance capacity to predict and adapt to extreme weather events such as floods, droughts and heatwaves. It is expected that, by filling data gaps in LDCs and SIDS, all countries will be able to make better weather forecasts and early warning systems and climate information globally will be enhanced.
Climate finance Rich countries’ broken promise trapping poor countries in debt (The Financial Express)
As the COP26 United Nations (UN) Climate Change Conference takes place in Glasgow (UK), serious reflections are needed on rich countries' broken promise "to a goal of mobilising jointly US$100 billion per year by 2020 to address the needs of developing countries" made 12 years ago at the COP16 in Copenhagen.
While minuscule compared with the investment required to avoid dangerous levels of climate change, non-transparency and double-counting make it harder to monitor the rich countries' broken promise. Meanwhile, poor countries are increasingly falling into debt traps trying to cope.
UK Export Finance (UKEF), the UK’s export credit agency, has today launched a call to action to business across the country to take advantage of renewable export opportunities around the world in the race to net zero. Launched at COP26 conference in Glasgow, UKEF is highlighting the global reach of ‘Made in Britain’ excellence and the scope for businesses to take the lead on driving a more sustainable future. Green trade is set to be worth £1.8 trillion by 2030, delivering up to £170 billion of export sales in goods and services for the UK by 2030. UKEF has enormous liquidity for UK businesses to tap into and take advantage of green trade, with a £50 billion capacity to support UK exports.
COVID-19 Responses Could Help Fight Climate Change (World Bank)
As the COVID-19 pandemic has overwhelmed health systems worldwide, a new report brings together low-carbon and climate-resilient health solutions that can help protect the planet and individuals against future threats. The report, COVID-19 and Climate-Smart Health Care: Health Sector Opportunities for Synergistic Response to the COVID-19 and Climate Crises, provides a framework based on lessons from the global COVID-19 health response to help countries build stronger health systems and leapfrog toward climate-smart universal health coverage (UHC).
“While the ongoing COVID-19 crisis presents significant global health challenges, the pandemic also presents opportunities to build resilient climate-smart health systems against future shocks,” said Juan Pablo Uribe, Global Director for Health, Nutrition and Population, World Bank. According to the report, which was produced by the World Bank and the Climate Investment Funds (CIF), countries that have integrated their response to COVID-19 and the climate crisis have been able to find lower-carbon and more climate-resilient solutions that are beneficial not just to health systems, but also the environment.
Tech takes central role in climate change fight (Business Daily)
As the ongoing deliberations on achieving the Paris Agreement continue in Glasgow, Scotland, Artificial Intelligence (AI) is being touted as a potential tech tool in cutting global carbon emissions. Technology companies and governments have in the past five years been tapping on AI algorithms to inform decisions, predictions and recommendations by analysing climate patterns in various data sets. And now, a new report released by networks company Nokia and GSMA Intelligence indicates that communication service providers (CSPs) around the world believe that deploying AI software is essential to reducing fast-rising network energy demand and emissions, spurred by the internet traffic growth.
COP26 Climate Change Briefs (World Bank)
Tackling climate change will require major social, economic and technological changes, many of which are costly and will require large investments. To achieve our climate objectives, it will be critical to integrate climate and development and identify projects at the country level that tackle mitigation and adaptation and channel appropriate sources and structures of financing toward these projects in a manner that maximizes impact. This is a complex goal from both the financing and project side, and will need to build on mitigation and adaptation diagnostics that show the trajectory of emissions, the major vulnerabilities, and the best climate interventions. These are the pillars of the World Bank Group’s new Climate Change Action plan (CCAP), which we launched in April 2021, and in which we committed to increase our climate finance target to 35% of total commitments over the next five years, align our financing flows with the goals of the Paris Agreement, and achieve results that integrate climate and development.
Our series of COP26 Climate Briefs unpack the key priorities of our CCAP. We added to our set of core diagnostics the Country Climate Development Reports (CCDRs), which we are already rolling out in 25 countries. These reports will provide important data and diagnostics to identify and prioritize actions that meaningfully reduce GHG emissions and build adaptation and resilience.
Members of the Joint Advisory Group (JAG) of the International Trade Centre (ITC) convened for its 55th session at the Palais des Nations and virtually on 2 November.
In his summary report, Chair H.E. Ambassador Paul Bekkers noted that Joint Advisory Group members commended ITC’s agile response to deliver much needed technical assistance during the COVID-19 pandemic, especially for small businesses, women, youth, and vulnerable communities. They expressed their approval for the results shown in the 2020 Annual Report and for the thrust of the Strategic Plan 2022-2025, which was presented during the meeting. Also shared were the findings of the Annual Evaluation Synthesis Report by ITC’s Independent Evaluation Unit.
Summarizing the members’ feedback on ITC’s work and future plans, she identified the following priorities: Keep “going green” in programmes, advocacy, operations. Help close the digital divide, to build more resilient economies through connectivity and empowered tech entrepreneurs. Continue strengthening women entrepreneurs. Show how ITC’s projects support the work of WTO and UNCTAD. Maintain focus on core constituency of least developed, landlocked, small island development states, small vulnerable economies, and conflict-affected countries.
The UN climate change conference kicks off a busy November. Bookending the month, we have the WTO’s 12th Ministerial Conference from 30 November to 3 December.
With global trade contracting sharply and then rallying strongly, the private sector has needed a trusted partner to turn to get information. Supply chains were, and indeed remain, stretched in many essential products. Perhaps the most essential of these is of course COVID-19 vaccines, therapeutics and diagnostics. This is one area where I believe that the WTO’s 12th Ministerial Conference can achieve meaningful results. Unequal access to COVID-19 vaccines is holding back economic recovery in many parts of the developing world, in particular among the lowest income countries. Recovery in an essential segment of the global services economy — that is, travel and tourism services — is critical for many least developed and small economies.
WTO rules have slowed, and even prevented, countries from taking very damaging measures. And our Trade Facilitation Agreement, although not designed with the pandemic in mind, has played an outsized role in worldwide recovery. Countries that have embraced and rapidly implemented trade facilitating measures and infrastructure have generally proven more resilient, more adaptable, and better equipped to keep trade flowing despite COVID-19-related lockdowns, travel restrictions, and social distancing.
The COVID-19 pandemic, which brought the global economy to a standstill for a significant period. When the pandemic struck, production and consumption across the world scaled back, and international trade appeared to be on its way to a persistent decline. However, in the summer of 2020, global merchandise trade began to recover, and by the end of the year, it was strongly rebounding in many countries and sectors, but not all. In the first half of 2021, global trade continued to grow, as value chains recovered and demand in advanced economies increased. According to the latest WTO forecast, the volume of global merchandise trade is predicted to grow by 10.8 percent in 2021, followed by a 4.7 percent rise in 2022.
However, many developing countries are not experiencing the same economic growth pattern, and this trend is deeply concerning because the economic recovery rate is predicted to be faster for countries with higher vaccination rates. For many developing countries where vaccination rates are low — on average 3 percent — the path to recovery will be long and uncertain unless urgent measures are taken.
With less than five weeks until the WTO’s 12th Ministerial Conference (MC12), due to take place from 30 November to 3 December, the agriculture negotiations are at “a critical juncture”, the Chair of the Committee on Agriculture in Special Session, Ambassador Gloria Abraham Peralta (Costa Rica), noted at a meeting on 28 October. She stressed that WTO members “now urgently need clear political guidance” on questions where gaps remain.
World exports of intermediate goods (IG), such as parts and components, rose by 47 per cent year-on-year in the second quarter of 2021, according to a new WTO quarterly report released to help track the health of global supply chains. The increase sustains the upward trend in IG exports recorded in the first quarter (20 per cent), during which IGs trade from most top exporters largely exceeded 2019 pre-pandemic levels.
A major review of ISORA following the 2018 round recognized that, despite the value of the existing information to both the international partners and participating tax administrations, data quality could be further improved. In the future, the survey will comprise a far smaller set of annual questions for which data will be collected annually rather than biennially, together with periodic questions, and all survey data will be placed in the public domain. ISORA 2020 data, covering the 2018 and 2019 fiscal years, is planned to be released publicly toward the end of 2021.
Opinion | The U.S. and EU Shake Up Global Trade (Wall Street Journal)
The Group of 20 summit in Rome last weekend was highly unusual. Unlike most global gabfests, it actually mattered—not because the sterile G-20 format and the anodyne communiqués it predictably generated meant or accomplished anything of significance. It mattered because the U.S. and the European Union, sidestepping the G-20 process, unveiled a tentative trade agreement that significantly sharpens the competition with China, and because five G-20 heads of government (China, Japan, Mexico, Russia and South Africa) were absent, highlighting the declining importance of these ritualized displays of international comity. The most important news out of Rome had nothing to do with the G-20. The temporary trade deal announced by European Commission President Ursula von der Leyen and President Biden does more than put some of the Trump-era steel and aluminum tariffs and retaliatory measures on ice. It lays out a new approach to world trade that, if it takes hold, could usher in the most consequential changes to the international trade regime in half a century or more.