tralac Daily News
South Africa is failing to ride the digital revolution wave. What it needs to do (The Conversation Africa)
Workplaces are adopting new forms of advanced automation at a rate that suggests a digital revolution in the making. Digital technologies such as sensorisation, networked data analytics, and artificial intelligence make it possible to collect data along the entire chain of production and consumption activities. They also enable the data to be used for a host of other purposes. These include shaping markets and industries, offering benefits like reducing production costs and time to market, and increasing product and service quality. But it is a revolution that is playing out unevenly, across and within countries. This has consequences for the competitiveness, inclusiveness and sustainability of economies.
Despite the disruptions brought on by Brexit and the pandemic, the UK imported more South African grown pears and apples this year, according to data from Hortgro, South Africa’s deciduous fruit grower organisation. The UK’s official exit out of the European Union at the start of the year has led to a plunge in exports and imports, leading to price spikes for some critical commodities. The world also continues to grapple with logistical challenges brought on by the pandemic-led global supply constraints. Overall, South African apple and pear exports rose 9% in 2021, with 33 million cartons of apples and 15.5 million cartons of pears shipped across the globe. But with 6.1 million apples exported to the UK this year it was the third-largest single export destination for apples from South Africa. Apples shipped to the UK accounted for 19% of South Africa’s total exports.
With delays at the Lebombo/Ressano Garcia border post on the Maputo corridor between South Africa and Mozambique having cost trucking companies R1.3-billion in lost revenue this year, the South African Association of Freight Forwarders (SAAFF) and the Minerals Council South Africa have requested the South African government to take urgent steps to address severe congestion at the border post. The SAAFF and the Minerals Council report that truck transporters confirm that border crossing times are the worst they have experienced in 15 years.
Trucking companies have experienced long delays in border crossing times, with waits of more than three days in recent weeks, exacerbating a crisis that has been ongoing since the beginning of August. The greatest challenge at the border crossing is the lack of 24-hour customs operations, resulting in crossing times having increased from an average of one hour to more than 20 hours since 2019. Further, Covid-19 restrictions are exacerbating the situation, leading to truck drivers’ vaccination certificates expiring while they wait in queues.
“These delays are resulting in loss of confidence, a loss of business and they are threatening the stability and sustainability of trade, transport, employment and job creation in South Africa,” says SAAFF CEO Dr Juanita Maree
Current account widens on higher importation bill (Business Daily)
Kenya’s current account deficit widened to 5.4 percent of GDP in the year to October from 4.8 percent a year earlier on the back of a bigger oil and industrial goods import bill. The year-on-year expansion of the deficit is also attributed to the base effect where last year oil prices had fallen to multi-year lows due to low demand on Covid travel restrictions, while local factory activity had also been curtailed by the Covid prevention restrictions. Ithas however eased slightly on a month-by-month basis, having stood at 5.6 percent in the 12 months to September 2021. The Central Bank of Kenya (CBK) however projects that the current account deficit will close the year at 5.2 percent helped by the global economic recovery which is expected to boost export demand and remittance inflows.
Kenyans living abroad spend Sh2.4bn in remittance costs (Business Daily)
Kenyans living abroad are spending an average of Sh2.4 billion per month in costs when sending money home to their relatives, with those using banks to remit cash, paying more compared to the ones utilising digital channels. The Central Bank of Kenya (CBK) said the cost of remittances to Kenya is averaging about seven percent, which is slightly below the average of eight percent for sub-Saharan Africa but well above the ideal target of three percent. In the 10 months to October 2021, Kenyans living abroad have sent home an average of Sh34.3 billion ($304.7 million) per month, a 20.4 percent jump compared to the Sh28.5 billion remitted in the corresponding period last year. “The issue of cost is a big concern, not just for Kenya but around the world, especially those countries in the emerging markets which are recipients of a large amount of remittances,” said CBK governor Patrick Njoroge on Tuesday.
Wholesale sugar price eases on higher local production (Business Daily)
The wholesale price of sugar for a 50-kilogramme bag has dropped by eight percent, signalling a drop in shelf prices for consumers who have been paying more for the sweetener in the past few weeks. Wholesalers are now selling the sugar at Sh5,700 from Sh6,200 last month, a drop attributed to increased local production due to higher volumes of cane delivery from farms in western Kenya. A spot check by the Business Daily across supermarkets in Nairobi showed that a two-kilogramme packet of Kabras Sugar brand is now retailing at an average of between Sh249-Sh255, while Ndhiwa Sugar is selling at Sh275 from a high of Sh285 last month. “The wholesale prices of sugar has retreated from the high of Sh6,200 last month to Sh5,700 for a 50-kilogramme bag, offering some relief from the sharp increase we had seen at the start of November,” said Benedict Gikunda, chief executive at sugar distributor Alesha Brands Limited.
In August and September, several factories grappled with production hitches following the breakdown of machines and shutdowns for routine maintenance.
Rwanda, DR Congo commit to boost trade through transportation (The New Times)
The Minister of Infrastructure, Ambassador Claver Gatete and his DRC counterpart, Cherubin Okende Senga on Wednesday, December 1 held a bilateral exchange on the development of air, road and railway infrastructure projects. The meeting that aimed at bolstering regional trade services was held on the sidelines of the 33rd plenary session of the African Civil Aviation Commission meeting, currently underway in Kigali. Officials from both sides were assessing the implementation of agreed on projects in the transportation sector that are meant to improve bilateral relations and how they can be accelerated.
“We’ve discussed the railway line project from Tanzania, through Rwanda and then to places like Goma, Masisi, Walikale and Kindu in the eastern part of the Democratic Republic of Congo,” he said, adding that all parties agreed that it is a mutually beneficial project. Gatete added the two neighboring countries have a bilateral air service agreement in the aviation sector, facilitating RwandAir flights to Kinshasa, then to Lubumbashi and finally, Goma, noting that the national carrier will soon launch a flight to Kisangani and other parts of DR Congo.
e-Levy would not affect AfCFTA in Ghana – Trade Expert (Ghana Business News0
Mr Louis Yaw Afful, Executive Director of the AfCFTA Policy Network (APN), has said that the proposed e-Levy on online transactions contained in the 2022 budget would not affect the Africa Continental Free Trade Agreement (AfCFTA). Mr Afful, speaking to the media, said the policy was an internal arrangement for the government to accrue some revenue, adding that Kenya was one of the countries to have started such a levy as a form of widening up the tax system to capture everyone. He said the implementation of AfCFTA did not prevent participating countries from instituting policies to protect their economic interests as such activities would not affect relationships with other member states.
The World Bank today approved a US$10 million credit from the International Development Association (IDA), the World Bank’s program for the poorest countries, in support of Djibouti’s efforts to accelerate the digital transformation and build a more inclusive digital economy. While Djibouti has made significant inroads in becoming a digital hub in regional connectivity and data markets, many Djiboutians do not fully benefit from the country’s connectivity infrastructure. The new Digital Foundations Project aims to ensure that more citizens and businesses have access to quality and affordable internet by developing an enabling environment for the gradual introduction of competition and private-sector investment in information and communication technology (ICT), and by fostering the uptake of digital skills and services. The project is aligned with the new Country Partnership Framework and Djibouti’s Vision 2035, which recognize the role of ICT in economic growth. “Accelerating digital transformation in Djibouti is an urgent necessity for post-COVID-19 recovery,” said Ilyas Moussa Dawaleh, Djibouti’s Minister of Economy and Finance in charge of Industry. “Stimulating economic growth, innovation and job creation through technology is an opportunity that will benefit present and future generations.”
Algeria at a Crossroads (IMF)
The Algerian economy is gradually recovering from the initial impact of the pandemic and last year’s oil price shock. The health crisis has eased, most containment measures have been lifted, and domestic production of vaccines is supporting immunization efforts. With the rebound in hydrocarbon production and prices, growth has resumed, but the outlook is highly uncertain.
The government’s policy response helped cushion the economy. However, the 2020 shocks exacerbated the economy’s longstanding imbalances, accelerating the rise in government debt and the fall in international reserves. Therefore, policy recalibration is needed to safeguard macroeconomic stability. The Government Action Plan that was unveiled in September incorporates wide-ranging reforms to support the recovery, unleash new growth drivers, and bolster governance and social cohesion. Progress on these reforms is also crucial for transitioning to a more stable, diversified and inclusive growth model.
The African Organisation for Standardisation (ARSO) and the African Continental Free Trade Area Secretariat have signed a Memorandum of Understanding (MoU) on the implementation of the AfCFTA agreement. The landmark partnership focuses on eliminating Technical Barriers to Trade (TBTs) that have restricted intra-African trade and undermined regional economic integration. This will ensure that technical regulations, standards, and conformity assessment procedures are harmonized and made non-discriminatory. The Director General of the Ghana Standards Authority and President-elect of ARSO, Prof Alex Dodoo made this known during the opening ceremony of the 65th ARSO Council Meeting in Accra.
“With this agreement, we will accelerate the harmonization of standards for priority products to ensure the private sector trade across the continent without obstacles,” Prof Dodoo said. The crucial role of ARSO in the implementation of the free trade deal has been captured under TBT Annex 6 in the agreement establishing the AfCFTA agreement.
The Ministry of Trade and Industry is urging member states of the African Continental Free Trade Area Agreement (AfCFTA) to prioritize the promotion of the development of both Special Economic Zones and the operationalization of AfCFTA. This, according to the Ministry of Trade, will allow private sector operators to harness the benefits of intra-Africa trade. Addressing delegates on behalf of the Minister of Trade, Alan Kyerematen at the 6th Africa Economic Zones Organization (AEZO) Annual Meeting, Information Minister, Kojo Oppong Nkrumah, asked African countries to take note of the various challenges that may obstruct the smooth operation of free trade on the continent for the full realization of the benefits of the AFCFTA. “The private sector operators cannot harness the benefits of both SEZs and the operationalization of AfCFTA if we do not develop programmes and projects to deal with the high cost of trading across our borders, weak trade infrastructure, inefficient customs clearance and unnecessary bureaucracy and red tape which tend to impede smooth regional trade.
“Ghana has already started implementing a comprehensive agenda for industrial transformation which is in line with the BIAT programme of action, in readiness to take advantage of the AfCFTA. Some of the interventions currently being pursued by the government under the BIAT priority clusters are the ‘One Region One Park’ initiative, which aims at developing at least one industrial park or Special Economic Zone in each of the 16 administrative regions in Ghana to provide easy access to dedicated commercial land spaces for enterprise development.”
On the sidelines of the IATF2021 Trade and Investment Conference, the Kwazulu-Natal Government and the African Export -Import Bank (Afreximbank) co-hosted a conference of African Sub-Sovereign Governments on 18 November 2021 under the theme: “African Sub-Sovereign Governments Network as a Vehicle for Promoting Intra-African Trade and Investment” in Durban, Kwazulu-Natal, South Africa.
The Conference noted concerns about the small size and slow growth of intra-African trade as well as the barriers that account for this limitation. Intra-African trade and investment still account for a fraction of the total African trade with the world despite decades of pursuing continental and regional economic integration. The Conference welcomed the establishment of the African Continental Free Trade Area as a platform for promoting and enhancing intra-African trade and investment, seeing it as an opportunity for stakeholders like sub-sovereign governments to contribute to growing intra-African trade and investment. The Conference saw this as key to achieving the objectives of the AU’s Agenda 2063. The Conference noted that promoting intra-African trade would enable Africa to reduce over-reliance on export of primary commodities and the risks of reliance on global value chains. It would also help increase economic integration and build the resilience of African economies against the vagaries of a global economy subject to fluctuations. The Conference acknowledged that there would be great value added by local enterprises in local and regional economic development. Sub-sovereign economies have opportunities that can contribute towards trade across African regions.
Cabo Verde President José Maria Neves on Thursday joined the development community in calling for urgent universal vaccine access as a way to mitigate the impact of Omicron and other variants of the Covid-19 virus. The World Health Organization on Friday categorized Omicron as a Covid-19 “variant of concern”, signifying that it could be more contagious than other known mutations. Neves told participants at the 2021 African Economic Conference that, although the world may have to live with Covid-19 for a few years, “we must act to manufacture our own vaccine and medicines to face this and other pandemics to come. We must find innovative mechanisms for financing and managing sustainable development, otherwise we will disappoint young Africans.”
Antonio Pedro, Deputy Executive Secretary at the Economic Commission for Africa, warned: “Failure to address the pandemic through universal access to vaccines will spawn more resilient and potent variants, threatening the global effort to fight the virus. The recent emergence of the Omicron variant of the Covid-19 virus illustrates my point.”
Hunger ultimately affects all aspects of our development agenda as a continent,” Dr Ibrahim Mayaki, the CEO of the African Union Development-NEPAD stated during the plenary session of the 17th Comprehensive Africa Agriculture Development Programme (CAADP) Partnership Platform meeting. CAADP was adopted by African Union member states in 2003 as a policy framework to accelerate agriculture led growth, while elevating improved food security and nutrition as well as increasing incomes in Africa’s largely agriculture-based economies. It is framed by ambitious goals to be achieved by 2025. In 2014, all African Heads of State re-committed to the continent’s CAADP targets and principles in the Malabo Declaration. The theme of 17th CAADP Partnership Platform was chosen to take advantage of the renewed momentum that has been created by the UN Food Systems Summit, at a moment when the continent is halfway through the Malabo Declaration timeframe.
“In order to improve the food and nutrition security in the continent, we need to fast-track the implementation of the Malabo Declaration, our approach to achieve the agricultural vision for Africa,” Amb. Josefa Sacko, Commissioner for Agriculture, Rural Development, Blue Economy and Sustainable Environment at the African Union Commission reiterated.
The African Development Bank’s African Natural Resources Centre and the Sustainable Energy Fund for Africa have hosted the first in a series of webinars discussing the potential of Africa’s blue economy. The webinar, held on November 23, centered around a study on the potential of offshore renewable energy in Africa commissioned by the African Natural Resources Centre as part of a series to inform policymaking, planning, and investment in blue economy strategies in Africa. The findings were presented by Linus Hammar from Octopus Ink Research & Analysis, Sweden.
“Financial institutions like the African Development Bank and other green energy funds should work with authorities in Africa and the small island development states to mobilize concessional finance to implement seawater air conditioning projects in their mitigation and adaptation efforts to combat the adverse effects of climate change and reduce dependence on fossil fuels,” he said.
The Southern African Development Community (SADC) Region should put in place policies and regulations that provide a conducive environment to support industrialisation and regional integration, Honourable Minister of Tourism, Culture and Wildlife, for the Republic of Malawi, Dr Michael Usi, has said. Speaking at the Support to Industrialisation and Productive Sectors (SIPS) in the SADC Region stakeholders’ engagement during the just-ended SADC Industrialisation Week, Hon. Min Usi said policy and regulations harmonisation was crucial in providing guidance in the actual operations of development programmes in the Region. He said the Region needs to build capacity to address emerging challenges. The Minister said SIPS had come at the right time as it aims to contribute to the SADC industrialisation and regional integration. He urged all stakeholders to ensure that their policies on the ground are conducive for the programme to achieve its objectives.
SADC urged to report funding of energy and water projects (Devdiscourse)
Water and Sanitation Deputy Minister, Dikeledi Magadzi, has called on the Southern African Development Community (SADC) to report regularly and indicate specific funding they receive in order to ensure that member states are conversant of projects that are undertaken.
The Deputy Minister made the remarks while addressing the 40th joint committee of SADC Ministers meeting responsible for energy and water held virtually on Thursday in Malawi. The department in a statement said the assembly of SADC Ministers was arranged for the common purpose of constructing some practical and feasible solutions to resolve, among other things, the financing of the regional energy and water projects. “The high-level gathering was also convened to lay out a strategic direction which seeks to allow Ministers to evaluate development and take firm decisions on water and energy projects,” it said.
Implementation of the regional integration agenda of the Southern African Development Community (SADC) is being amplified through an €18,7 million programme jointly funded by the European Union (EU) and the Federal Republic of Germany. Through the Integrated Institutional Capacity Building Programme (IICB), the SADC Secretariat seeks to speed up implementation of the SADC regional integration agenda guided by the Vision 2050 and Regional Indicative Strategic Development Programme 2020-2030. Specifically, the IICB Programme is aimed at enhancing the capacity of national structures of SADC Member States and the Secretariat to facilitate and co-ordinate implementation of regional programmes.
China signals cuts in loans to Africa after reduction of financing pledge (The East African)
China has signalled a reduction in loans to Kenya and other African countries in coming years after it cut financial commitment to projects in the continent as much as a third in the next three years. Nairobi has been a major beneficiary of China’s loans for the development of mega infrastructure projects such as roads and a modern railway over the last decade, making Beijing the largest bilateral creditor since 2015. President Xi Jinping on Monday pledged — through a video link to the Eighth Ministerial Conference of the Forum on China-Africa Cooperation (FOCAC) in Senegal — to invest $40 billion (Ksh4.5 trillion) in African countries for three years. That represents a 33.33 percent drop from the $60 billion (Ksh6.75 trillion) the world’s second-largest economy has committed to African countries in the last two FOCAC summits, which takes place every three years.
Upholding the brotherhood of Sino-Africa relations (The Star, Kenya)
That the relationship between China and Africa has grown in leaps and bounds over the last couple of decades is not in contention. From increasing bilateral relations, the partnership has now coalesced into a multilateral platform where the partners now discuss overarching issues in order to come into a common understanding. The recent conclusion of the eighth ministerial conference of the Forum on China-Africa Cooperation (FOCAC) in Dakar, Senegal once again proved the unbreakable bond between the two, and huge potential that is still untapped in the win-win partnership.
At the 2018 Focac Beijing Summit, Chinese President Xi Jinping proposed eight major initiatives which were unanimously agreed on by his African counterparts. Since then, the two sides have cooperated in various fields including industrial promotion, infrastructure connectivity, trade facilitation, and green development.
In his speech during the Dakar event, President Xi made four proposals to further entrench the partnership. First is fighting Covid-19 with solidarity where the two put people and their lives first guided by science, support waiving intellectual property rights on Covid-19 vaccines, and truly ensure the accessibility and affordability of vaccines in Africa to bridge the immunisation gap.
Second is deepening practical cooperation by opening up new prospects for cooperation, expand trade and investment, share experience on poverty reduction, strengthen cooperation on digital economy, and promote entrepreneurship by young Africans and the development of small and medium-sized enterprises (SMEs).
When Chinese agricultural experts visited Mozambique a couple of years ago, they found a lot of rich but mismanaged soil. Highly dependent on weather, the rice yield per mu was only 100-200 kilograms there without scientific planting techniques. Now with the effort of many experienced Chinese experts and China-invested agriculture enterprises, “the rice yields in most areas of Mozambique have reached 600 kilograms per mu,” said rice cultivating expert Li Ganghua, who has been to various African countries with his Chinese coworkers to teach local farmers rice planting skills. “It’s common that the rice yield triples [its previous harvest],” Li told the Global Times.
“We are thinking about... whether we can design some [poverty reduction] methods, which have been proven effective in China, for the reference of African countries,” Wu Peng, Director of the Department of African Affairs in the Chinese Ministry of Foreign Affairs, said in a speech he delivered in late October.
Apart from sharing crop cultivating techniques with African villages, in recent years the world has also seen China spare no effort in helping connect people in rural Africa to the world with modern internet tech.
Now “looking east” and “learning from China” have become a trend in African countries, Zhang Weiwei, director of the China Institute of Fudan University in Shanghai, said in his speech in October. ”With the promotion of the Belt and Road Initiative, and the rapid development of China-Africa trade, the experience of China’s successful rise will attract and inspire a great many people in Africa,” Zhang said.
The value of world imports and exports of goods hit $5.6 trillion in the third quarter of 2021, setting a new quarterly record, according to an UNCTAD report published on 30 November. New projections in the November edition of the organization’s Global Trade Update show trade in goods and services reaching $28 trillion for the year – an increase of 23% on 2020 and 11% compared with pre-COVID-19 levels. But trade’s overall strong performance masks that the recovery has been uneven across countries and sectors, the report says. “The positive trend for international trade in 2021 is largely the result of the strong recovery in demand due to subsiding pandemic restrictions, economic stimulus packages, and increases in commodity prices,” it says. It also warns that the forecast for 2022 remains very uncertain.
Vice-minister Yáñez welcomed the new participants: “More than two-thirds of the WTO membership are now participating in these negotiations — a remarkable achievement. This reflects that, from the outset, this initiative has always been open to all and pro-multilateral.”
The draft Ministerial Statement included a target date to conclude text negotiations by the end of 2022 and reaffirmed the determination to further intensify outreach efforts towards other WTO members. The text also reiterated the importance of developing and least developed country (LDC) members’ participation in global investment flows and the need for technical assistance and capacity building to help them implement the future IFD Agreement.
For the past year, member nations of the World Trade Organization have been deadlocked over a proposal made by India and South Africa to temporarily suspend intellectual property rights to boost production of Covid-19 vaccines and therapeutics for low-income nations. The proposal is backed by more than 100 countries, including the United States. A temporary ban would allow multiple actors to start production sooner, instead of having manufacturing concentrated in the hands of a small number of patent holders, the Lancet reported. Opponents of the waiver want to protect intellectual property to encourage research and innovation. Some rich regions, which are home to big pharmaceutical industries, including the United Kingdom, Switzerland, and the EU, have opposed the waiver, arguing that suspending the IP would not result in a sudden surge of vaccine supply.
Lower-income countries and developing countries find themselves short on vaccine supply, with no authority to manufacture locally and isolated from the world through travel bans when they are hit with a severe wave of Covid-19 cases.
“If we use the traditional way of access, countries’ reaction to pandemic is delayed,” Hu told CNN. “Waiver will open up production of raw materials. Currently, some of it is under monopoly. In order to open up the entire value chain, we need the waiver.”
WTO chief ‘very concerned’ about the unequal distribution of Covid vaccines (CNBC)
The unequal distribution of Covid vaccines worldwide could have a dampening effect on the economic recovery, the World Trade Organization chief warned on Thursday, saying she is “very concerned” about the matter.
Data collected by the WTO, the World Health Organization and the International Monetary Fund show that whereas the U.S. has secured 248% of produced vaccines as a percentage of its population, this rate is only 30% for Mali and 56% for Kenya.
“The level of inequity is quite high,” Ngozi Okonjo-Iweala, Director-General of the WTO, told CNBC on Thursday in an exclusive interview. She noted that the economic recovery in the wake of the pandemic is linked to two determinants: the amount of monetary and fiscal stimulus and the access to vaccines. “I am very concerned that if we continue with the inequity that will have a dampening effect on (the) recovery in those countries,” the Nigerian-born official said.
The trade organization was once again forced to postpone a key meeting scheduled for this week due to the discovery of the new Covid variant.” It was a very painful decision,” Okonjo-Iweala said. The delay is seen as a blow to hopes of temporarily waiving patents for Covid vaccines and achieving more
DHL reveals e-commerce trends and opportunities throughout the pandemic (Parcel and Postal Technology International)
DHL Express has unveiled the results of its 2021 Global Connectedness Index, and reflected on the past year’s events in e-commerce and the trends within the global flow of goods.
In an overview of the entire study, John Pearson, CEO of DHL Express, emphasized the role of e-commerce and the drastic changes it underwent over the examined period. He said, “E-commerce is the commerce. Five years ago, plenty of people bought something online. Last year, just about everyone bought everything online. So it really was a paradigm shift last year. The phrase that came to mind was three years of growth in three months. That’s absolutely what happened around May, June, July: our e-commerce volumes took off by 30%, 40%, 50% – not weight, not revenue – volume. That started to settle down toward the end of the year. It really is a global phenomenon, not just a US, UK, Germany thing only. Any country in the world that has a great product and wants to take it to market from their garage or their small marketplace has the ability to do that and absolutely are doing that.”
The Global Connectedness Index found that global trade in general declined very modestly in 2020 and is on track to rise in 2021. Importantly for the logistics sector, this year’s report found that trade in goods surged to 5% above pre-pandemic levels by early 2021. Nonetheless, the Covid-19 ‘stress test’ also revealed longstanding vulnerabilities that demand attention moving forward. These include the ongoing need for courier services to focus on their merchant customers, and the fact that low-income countries have lagged behind in their recovery of cross-border goods trading.
Global rules of trade, embodied in the WTO Agreements, provide assurance and stability to economic actors across the world. On the one hand, producers and exporters know that they can source components and raw materials from abroad and that foreign markets will be open to their goods and services. On the other hand, consumers know they can enjoy a secure supply of finished products and services. This leads to a more prosperous and peaceful economic world. Moreover, trade has a positive impact on employment and jobs. Industries dependent on international trade are major employers in advanced economies, as well as in many developing ones. For example, in the EU, extra-EU exports of goods and services support around 38 million jobs. In the U.S., one in five jobs is supported by trade. In developing countries that specialize in the production of labour-intensive goods such as light manufacturing, trade creates jobs, including for unskilled workers. The importance of the rules-based trade has been further magnified by the COVID-19 pandemic. According to our data, in 2020, the value of global trade in goods and services in nominal terms fell by 9.6 percent, while global GDP fell by 3.3 percent. This was the most severe recession since World War II. But the trading system has proved itself more resilient than many expected at the outset of the crisis. 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.
I would like to start with what has been on the minds of many of us since last Friday — the WTO’s decision to postpone the Ministerial Conference (or MC12), which was supposed to start yesterday.
Speaking to a meeting of delegation heads from all WTO members, the Director-General said the decision to postpone MC12 was “as disappointing as it was necessary”. In addition to the potential health risks from the Omicron variant, travel restrictions introduced in response to its emergence had made it impossible for all ministers to participate on an equitable basis at the conference, which had been set to run from 30 November to 3 December in Geneva.
Just because the ministerial had been postponed did not mean that negotiations had stopped, the Director-General emphasised. She welcomed the ongoing meetings among ambassadors and experts to try to keep bridging gaps they had narrowed over the course of weeks of nearly round-the-clock preparatory negotiations and encouraged them to continue. The challenge for them now was to “recover from last week’s unexpected setback to deliver results for the people we serve”.
Twenty years is a long time to talk about fish. But hopes that World Trade Organization (WTO) members would finally reach a meaningful agreement to ban subsidies that enable overfishing at the Ministerial Conference (MC12) this year were dashed Friday when organizers postponed the event indefinitely, due to concerns over the novel Omicron COVID-19 variant. “This does not mean that negotiations should stop,” Ngozi Okonjo-Iweala, the WTO’s director-general, said in a press release about the postponement. “On the contrary, delegations in Geneva should be fully empowered to close as many gaps as possible. This new variant reminds us once again of the urgency of the work we are charged with.”
The global trade regulator is grappling with how to keep itself relevant amid rising calls for reform of trade rules made last century that observers say no longer fit present-day economic conditions. Many observers saw MC12, formally the Twelfth WTO Ministerial Conference and scheduled to run Nov. 30 through Dec. 3 in Geneva, Switzerland, as a chance for the WTO to prove its ability to conclude major trade deals and to reform its dispute settlement and negotiation pillars. Other major agenda items for the meeting were the waiver of trade-related intellectual property rights for COVID-19 vaccines and reform of the WTO’s organizational process. Okonjo-Iweala had emphasized the importance of the fisheries subsidies negotiation at an April meeting of delegation heads: “[C]oncluding these negotiations is a top priority for this organization, not only for the fisheries, but also for the WTO system. We simply cannot afford to fail here,” she said. “if there is anything that would demonstrate that the WTO is back and capable of having positive results, it is a good outcome early enough this year to these fisheries subsidies negotiations.”
The declaration notes the conclusion of the negotiations on new disciplines relating to domestic regulation for services that seek to improve the business climate, lower trade costs and cut red tape so as to facilitate services trade worldwide. It also welcomes the schedules submitted by WTO members participating in the negotiations spelling out how each participant will incorporate the new disciplines into its existing services commitments. In the declaration, participants commit to certifying the new commitments within 12 months.
Despite significant relief measures brought on by the COVID-19 crisis, about 60 percent of low-income countries are at high risk or already in debt distress. In 2015 that number was below 30 percent. For many of these countries, the challenges are mounting. New variants are causing further disruptions to economic activity. COVID-related initiatives such as the G20 Debt Service Suspension Initiative (DSSI) are ending. Many countries face arrears or a reduction in priority expenditures. We may see economic collapse in some countries unless G20 creditors agree to accelerate debt restructurings and suspend debt service while the restructurings are being negotiated. It is also critical that private sector creditors implement debt relief on comparable terms.
Recent experiences of Chad, Ethiopia, and Zambia show that the Common Framework for debt treatments beyond the DSSI must be improved. Quick action is needed to build confidence in the framework and provide a road map for helping other countries facing increasing debt vulnerabilities.
The new platform will allow small businesses to access a diverse range of trade information brought together from a variety of sources. It can be accessed here. The platform contains short guides providing key information on the steps that companies need to follow before exporting or importing goods or services, such as how to assess the export potential of the markets they are targeting and their readiness to export. The guides list the key trade documents required for companies to export or import in various markets, the contractual or intellectual property issues that need to be considered and the logistics and transport options available. The guides also explain how small businesses can access trade finance, make the best use of digital tools, and deal with potential trade disputes.
This is good news for global development, but ITU said that people’s ability to connect remains profoundly unequal – as many hundreds of millions might only go online infrequently, using shared devices or facing connection speeds that hamper their internet use. “While almost two-thirds of the world’s population is now online, there is a lot more to do to get everyone connected to the Internet,” Houlin Zhao, ITU Secretary-General said.
The UN agency’s report found that the unusually sharp rise in the number of people online suggests that measures taken during the pandemic contributed to the “COVID connectivity boost.”
An oft-cited strategy to advance economic development is to further integrate developing countries into global trade, particularly through global value chains, bolstered by the expansion of female-intensive industries that bring more women into the formal labor force. As a result, a frequent debate centers on whether the apparel industry—the most female-intensive and globally engaged manufacturing industry—can be a key player in this regard.
From Jobs to Careers: Apparel Exports and Career Paths for Women in Developing Countries answers this question by focusing on seven countries where apparel plays a vital role in their export baskets—Bangladesh, Cambodia, Egypt, Pakistan, Sri Lanka, Turkey, and Vietnam. It finds that the apparel industry indeed can serve as a launching pad to bring more women into the labor market. But for this approach to work, complementary policies must tackle the barriers that hinder women in their pursuit of long-term workforce participation and better-paid occupations. Key policy recommendations include increasing the participation of female production workers in export-oriented apparel manufacturing and associated industries, upgrading within apparel to manufacturing-related industries, boosting access to education, and breaking glass ceilings.
In response to the question: What are your reflections from the point of view of the United Nations and more specifically of UNDP on the progress made in the first decade of implementation of the UNGPs and the priorities going forward? This year’s Forum looks ahead to the Next Decade of Business and Human Rights. However, the Next Decade is already upon us.
We need to spur state and business action through peer learning. I’m pleased to announce that UNDP and OHCHR will organise a Regional Forum in Africa in May 2022. We need to focus on access to remedy. NHRIs, legal aid systems and judiciaries must receive more support, or the UNGPs risk becoming a ‘toothless tiger’.
The task ahead of us all is not an easy one. However, the level of commitment displayed once again in this Forum encourages us to confront the challenges, one by one, guided by the Roadmap and its key message – that we have to do more, and we have to do it together to ensure the UNGPs fulfil their promise.