tralac Daily News
Address by Fikile Majola, Deputy Minister of Trade, Industry and Competition delivered on the occasion of the Virtual Colloquium: Opportunities in mobile applications development market in South Africa (the dtic)
The advent of the COVID-19 pandemic and the rise of the Fourth Industrial Revolution (4IR) has accelerated the need for mobile applications (apps) in almost all businesses, work and life. Digitisation, remote flexible working and e-commerce have increased the global demand for software developers. The digital technology combined with the use of robotics is already dominating services and manufacturing industries amongst most competitive economies in the world.
As a result, there is increased demand for mobile apps among the majority of big firms and businesses. Mobile apps development is rapidly growing in areas such as retail, telecommunications and e-commerce, insurance, healthcare, social networks, sports, news, gaming and government.
South Africa’s Parliamentary Joint Standing Committee on Defence has affirmed that the government should give the country’s defence industry the support it needed to ensure its sustainability. The committee did so in a statement released on Friday, in which it reported that it had received the ‘controlled item transfers’ reports, covering both defence imports and exports, for the second, third and fourth quarters of this year. “The committee noted that the impediments to exports that are creating a backlog of R3.5-billion in orders, especially from the Gulf region, is receiving the attention of senior government authorities,” it said in the statement. “The growth and strength of the South African defence industry is dependent on receiving and satisfying orders that will play a critical role in growing the economy and creating much-needed job opportunities.” However, the country’s defence exports had to comply with national legislation, international obligations and address proliferation concerns. It was necessary to maintain a balance between these issues and the preservation of defence industry jobs in the country.
Art, craft exports rake in US$5,2m earnings (Chronicle)
THE art and craft sector is fast gaining momentum on the export front after raking in US$5,2 million between and January and August this year. Through ZimTrade, the Government is working closely with players in the sector to unlock its wider potential and contribution to mainstream economy.
Ongoing business engagement programmes organised by ZimTrade to create sustainable and direct links between local artistes and buyers in international markets has seen the arts and crafts sector recording a 92,4 percent export growth in the first eight months of the year. “Statistics show that exports from arts and crafts sector grew to US$5,2 million during the period under review this year, from US$2,7 million during the same period last year,” said ZimTrade citing official data from ZimStat. “With current export promotion activities in which the sector in actively involved, projections are that figures will continue to grow.”
US mum on Kenya trade pact talks (Business Daily)
The US is mum yet again on the fate of a free trade pact after top American trade officials and their Kenyan counterparts held talks earlier in the week. Separate statements issued by both Kenya’s Trade Cabinet secretary Betty Maina and her US trade chief Katherine Tai, after a virtual meeting last Tuesday did not provide any timelines for resuming the stalled talks on the deal signalling a persisting deadlock. There has been growing unease in Nairobi about the delay by Joe Biden’s administration to conclude the deal. Both Nairobi and Washington, however, emphasised deepening trade engagement between the two countries.
The statement said the two Trade ministers guided their senior teams in the identification of “creative approaches” to key issues that would align the ongoing relationship to the “worker-centred trade policy in the US-Kenya trade and investment relationship,” while at the same time strengthening the US-Kenya economic and trade ties.
Kenya contracts US firm to find cheaper sources for liquefied gas (The East African)
Kenya has revived its ambitious natural gas generation project after it gave the greenlight to a US firm to conduct a feasibility study for gas power generation in Mombasa. This comes as Nairobi seeks to cut its reliance on Dar es Salaam for liquefied petroleum gas (LPG), which has seen the Tanga plant in Mtwara service nearly half of the Kenyan market, trucked via Namanga and Holili border posts. Despite Kenya and Dar signing an agreement to start working on a gas pipeline from Dar es Salaam to Mombasa, as part of a long-term project to share energy resources, Kenya remains open to other options including importing the commodity. This means, that the agreement between Kenya and Tanzania might be nullified if the company recommends cheaper means to get natural gas to generate power.
Tanzania eyes edible oils market (The East African)
Tanzania is now working closely with Uganda to study best practices that will help boost production of edible oil seeds going by Kampala’s success in producing palm oil. Last week, Tanzania’s Agriculture minister Adolf Mkenda was in Kampala on a study tour for the same. Prof Mkenda was accompanied by senior agricultural officials from key agricultural regions including Kigoma, which produces palm oil seeds. Prof Mkenda held discussions with the Ugandan Minister for Agriculture Frank Tumwebaze and agreed to cooperate in oil seeds production, marketing and agricultural research.
The minister said Tanzania was planning to increase production of improved sunflower seeds, groundnuts, oil palm and sesame, with an increased budget for extension and research services. The deficit is imported from Malaysia, India, Singapore and Indonesia at a cost of $204.7 million per year.
New roads, border posts open trade routes to DRC (The East African)
Uganda and Rwanda are banking on new roads, and border posts to boost access and trade with the Democratic Republic of Congo. Last Sunday, Uganda launched a road-building project aimed at boosting trade between the two countries. Sites for the roads were handed over to the contractor, Dott Services Ltd, a Ugandan construction firm, Kampala said in a statement adding that the roads “will open the eastern part of DRC to cross border trade with Uganda”. The 223km road network will connect Uganda to the cities of Beni, Goma and Butembo. Uganda had announced the plans to build roads in Congo in 2019. Kampala is keen to tap this market where decades of insecurity has meant local manufacturing is non-existent, forcing dependence on imported goods. Better access to trade with Congo would also help Uganda make up for export revenues lost after Rwanda, formerly a big market for Ugandan goods, shut their common border more than two years ago. These roads will bring jobs and interconnectedness with Uganda, Congo’s Minister for Infrastructure and Public Works, Alexi Gisaro Muvunyi said
Dr Kalu Idika Kalu, former Minister of Finance has warned that addressing Nigeria’s subsidy issues by merely removing it will still bring Nigerians back to the same issues, including price differentials. The former Minister disclosed this in an interview with Channels Television on Sunday evening. “If you have the funds, you can cushion the impact on your producers by giving subsidy and that goes from farmers to manufacturers to all sorts of things. But you also have to weigh it against the cost of putting subsidy,” he said.
He stated that subsidy could be something used for a phase, and not an all-time thing. He said it could be phased because of the objective which is to encourage production, to improve resource uses and balance of resource allocation, and so on. “You can’t remove subsidy without addressing all the macro-economic determinants of domestic prices of petroleum, government control or other prices, including inadequate production, frictions in import flow or supply chains.
‘Natural Gas must power Africa’s industrialisation agenda’ (BusinessGhana)
The President of the Nigerian Gas Association and Managing Director of Shell Nigeria Gas, Mr Ed Ubong has made a call for the need to harness Africa’s natural gas for industrialisation and economic diversification. He said the vast gas resources available on the continent, especially in West Africa must be used to power the continent’s industrialisation agenda.
NTEs revenue slightly dips to US$2.85bn in 2020 (The Business & Financial Times)
Revenue from Ghana’s Non-Traditional Export earnings from January to December 2020 amounted to US$2.846billion, the Ghana Export Promotions Authority (GEPA) has announced. The amount indicates a decline of -1.84 percent over the 2019 earnings of US$2.899billion, with GEPA associating the minimal dip to the impact of COVID-19 on global trade. The fall, GEPA said, was due to a downward trend in the processed and semi-processed product sector’s performance, particularly cocoa-butter and canned tuna.
Gamea’s remarks came during her inauguration of the sixth edition of the Food Africa Exhibition on Sunday, which is being held in Egypt’s International Exhibitions Centre for two days from 12 to 14 December with the participation of 400 local and international companies. During her speech, which came on behalf of Egypt’s Prime Minister Mostafa Madbouly, Gamea said that Egypt’s exports of agricultural crops in the first nine months of 2021 hit $1.9 billion, compared to the $1.8 billion achieved in the same period last year, recording an 8 percent increase. Gamea noted that the most important agricultural crops exported include rice, grains, onions, garlic, potatoes, vegetables, fruits, citrus fruits, and peanuts, for which Russia, Saudi Arabia, Britain, and the United Arab Emirates are the most important markets for such Egyptian exports.
Morocco’s economy is rebounding. The economic recovery is expected to continue over the next few years, although the COVID-19 pandemic will leave some scars. The authorities have embarked on a broad range of structural reforms, which should be supported by an adequate financing plan and a coherent and stable macroeconomic framework. Reforms to extend social protection to all Moroccans remain a priority, together with efforts to boost private sector development.
The private sector in Africa will play a critical role in speeding up industrial development and economic diversification, particularly in the context of the ongoing pandemic and other development challenges, as part of the African Continental Free Trade Area (AfCFTA), says logistics company Imperial Business Intelligence executive Mark Prommel and Imperial marketing and communications VP Melissa Arjoonan. The private sector accounts for about 80% of total production, 67% of investment, 75% of credit and employs 90% of the working age population in Africa. Several determining factors, including an enabling business environment, affordable connectivity, accelerated digitalisation and opportunities to forge strong public-private partnerships are crucial to ensuring businesses’ commitment to trade and investment in the AfCFTA, Prommel and Arnoonan say.
However, African countries imported R8-trillion worth of goods in 2019, only R1-trillion of which came from other African countries. There are vast distances between markets on the continent, which means that transferring products at different levels of the value chain can be costly. This challenge is further exacerbated by the lack of enabling infrastructure connecting countries, especially rail, which can provide cost-effective transportation.
Nigeria has ratified its membership of the African free-trade zone due to be launched in January, the government said, after initial reluctance to join the bloc for fear of exposing local industries to dumping by countries outside Africa. A cabinet meeting on Wednesday endorsed the president’s decision to join the African Continental Free Trade Area (AfCFTA) following the signing of agreements last year, Information Minister Lai Mohammed said. Mohammed said countries have until December to ratify the agreement, whose launch was pushed back after the new coronavirus pandemic made its original start date untenable.
To date, 30 countries out of the 55 states in the African Union have both signed and ratified the AfCFTA. Only Eritrea has yet to sign, according to Tralac, a South Africa-based trade law organization.
Secretary General for the African Continental Free Trade Area (AfCFTA), Wamkele Mene, has disclosed that Africa’s recovery from COVID-19 will be the slowest among world regions due to limitations, fiscal constraints, monetary policies, insufficient support and the slow vaccine rollout. The pandemic has caused significant disruption, hardship and nearly every aspect of people’s lives have been affected in almost two years since its onset. The effect of the outbreak continues to weigh heavily on national economies. Moreover, the African continent is expected to transition from the COVID-19 induced recession of 2020. The expected growth rates of 3.4 and 4.5% in 2021 and 2022, respectively. Speaking at the 2021 Kusi Ideas festival organised by the Nation Media Group (NMG) in collaboration with the Ghana Tourism Authority, under the theme “How Africa transforms after the virus” Mr. Mene said, “There is a major need for African countries to step up and accelerate efforts towards transformation of our economies, diversified export markets, inclusive and sustained patterns of economic growth”.
The implementation of the African Continental Free Trade Area (AfCFTA) would spur Africa’s industrialisation and long-term supply chain resilience, Mr. Amr Kamel, Afreximbank’s Executive Vice President in charge of Business Development and Corporate Banking, said Tuesday as the Bank opened its annual Trade Finance Seminar (ATFS) and workshop.
He noted that the export sector inherited from Africa’s former colonial powers effectively forced the demise of African industry and created a reliance on imported manufactured goods and said that the establishment of the AfCFTA marked a strategic shift from small and fragmented markets across Africa towards regional markets that offered greater opportunities for economies of scale and for the deployment of regional integration to drive trade and development.
He, however, warned that, “A major challenge to the AfCFTA is the high trade finance gap, estimated at US$82 billion, according to a recent Trade Finance Survey jointly conducted by Afreximbank and the AfDB,” saying, “this lack of adequate trade finance is a significant non-tariff barrier to trade and can limit the full trade potential of the AfCFTA.”
The Chief Executive Officer (CEO), Compass Global Limited, Mrs. Tokunbo Chiedu, has said that access to market intelligence, finance, trade information, and market requirements are vital to deepen intra-Africa trade among small and medium enterprises (SMEs). Chiedu, who stated this in a statement in Lagos, said that this was important to foster new business opportunities, through business linkages and engagements.
Import demand likely to weigh on Cedi as year end approaches (Business & Financial Times)
The Cedi remained under pressure over the past week, sliding to 6.187 to the dollar from 6.16 at last Friday’s close. Ghana and the Cote d’Ivoire met this week to further formalise the Ivory Coast Ghana Cocoa Initiative, which is aimed at boosting cocoa farmers’ income. The two countries together account for 65% of global cocoa supply.
The agreement is likely to drive more exports and contribute towards a greater share of Ghana’s external FX reserves. However, due to increased demand for imports as the year draws to a close, we expect to see the Cedi come under further pressure in coming days.
EAC players seek to clinch Congo’s $2b market from S. African states (The East African)
East African states are scrambling to wrest the multi-billion dollar Democratic Republic of Congo (DRC) market from the Southern African players, buoyed by the prospects of Kinshasa joining the East African Community early next year.
The EAC Council of Ministers has cleared DRC for admission as the seventh member of the bloc, opening up a mass consumer market of about 90 million people and an economy rich in minerals and other natural resources. But, as the EAC partners fall over each other to win Congolese President Felix Tshisekedi’s eye, South Africa and Zambia, both members of the Southern African Development Community (SADC), continue to dominate the export market to Congo, raking in a combined $2 billion in exports in 2020, according to latest data.
Four east African countries of Tanzania, Kenya, Uganda and Rwanda have joined hands to fight plastic pollution in the region, an official said Ana Le Rocha, the executive director of Nipe Fagio, said the four countries have decided to start a Single-Use Plastic Free East African Community (EAC) campaign to advocate against the use of single-use plastics in the region, reports xinhua news agency. Nipe Fagio is a Kiswahili slogan translated in English as ‘Give me the Broom’. It is a public advocacy organization that focuses on increasing awareness by facilitating and promoting sustainable development in Tanzania.
A draft report of the Central Africa Office of the United Nations Economic Commission for Africa (ECA) urges Central African countries to “capitalize on their unrivalled renewable energy potential to accelerate economic diversification.” On 10 December 2021, experts from all the countries of the sub-region approved the ECA report which will soon be presented to policymakers. The experts recommended in particular to ECCAS and the member States of the sub-region to adopt a sub-regional policy on renewable energy and to harmonize them at country level. They also expressed the need to strengthen the legal and institutional frameworks at national and sub-regional levels to support the development of renewable energy in Central Africa and then harmonize the relevant national policies.
It is high time regional economic communities, in particular CEMAC and ECCAS, in cooperation with the United Nations Economic Commission for Africa (ECA) created a consortium on the use of natural capital accounting to stimulate economic diversification and industrialization with the private sector as key player. Such was one of the key recommendations of an expert session on “Natural capital accounting, reassessing economic wealth and broadening fiscal space in Central Africa” organized by the Central Africa Office of the United Nations Economic Commission for Africa (ECA) on 8 and 9 December 2021 in Brazzaville, capital of the Congo.
Central African economies would make a complete turnaround from exporting raw gems and other commodities, to a state of value addition and economic diversification, should they wake up to a new paradigm of leadership and transformational change, involving all segments of society. A series of high-level debates and group reflections at the 37th session of the Intergovernmental Committee of Senior Officials and Experts for Central Africa (ICE), at the Kintele International Conference Centre near Brazzaville, came to this overall conclusion, Friday 10 December 2021.
“We have highlighted the need to pull together public sector actors, the private sector and civil society, constituting a coalition of leaders to speed up economic diversification in our subregion, while putting into play the important roles of accounting for our vast natural capital and harnessing the subregion’s potential in producing and supplying renewable energy,” he went on. ECA’s Central Africa Office presented a study to guide strategies and actions to engender the changes being advocated styled: “A Trip to 2030: Fostering Leadership and Transformative Change or Economic Diversification in Central Africa.”
The draft legal texts for the operationalisation of the ECOWAS Regional Competition Authority were presented on Monday 6 December 2021, to the ECOWAS Parliament by a team from ERCA led by the Ag. Executive Director Dr Simeon Koffi and comprising Principal Programme Officer, Legal Affairs, Investigation, Compliance and Application of Law, Dr Yaouza Ouro-Sama.
The presentation was made to the joint Committee of the Parliament comprising members of the Trade, Customs and Free Movement as well as the Legal Affairs and Human Rights, in fulfilment of the provisions of Article 9.1b of Supplementary Act A/SA.1/12/16 of 17 December 2016 on the Enhancement of the powers of the ECOWAS Parliament, which prescribes the compulsory referral to the Parliament when the Treaty or one of its annexes is to be adopted or revised.
Following the presentation of the draft texts relating to customs by the Director of Customs of the ECOWAS Commission, ERCA presented to the Joint Committee the draft Supplementary Act amending the Supplementary Act on the establishment, powers and functioning of ERCA, the draft Regulation on the powers and composition of the ERCA Council, the draft Regulation on the procedures of ERCA, the draft Regulation on the rules of procedure for mergers and acquisitions as well as the draft Regulation adopting the rules on clemency and immunity in competition matters.
“The unprecedented participation of so many countries shows the commitment to strengthen the countries’ regulatory environment with a view to improving the performance of the respective electricity sectors,” said Dr. Kevin Kariuki, the African Development Bank’s Vice President for Power, Energy, Climate and Green Growth.
For the fourth consecutive year, Uganda’s electricity sector is Africa’s best regulated across a number of key metrics, according to the African Development Bank’s 2021 Electricity Regulatory Index. Other strong performers include East African neighbours, Kenya and Tanzania, as well as Namibia and Egypt. The 2021 Electricity Regulatory Index, an annual report, covered 43 countries, up from 36 in the previous edition, and assessed their impact on the performance of their electricity sectors. The index covered 3 countries in the North Africa region; 14 in West Africa; 6 in Central Africa; 7 in East Africa; and 13 in the Southern Africa region.
According to the report, the average performance on economic regulation has continued to decline since 2018. A third of countries surveyed indicated they lack methodologies to determine tariffs; another 40% rely on tariff methodologies that do not include key attributes such as automatic tariff adjustment and tariff indexation mechanisms and schedule for major tariff reviews.
“I met a wide variety of members and groups holding different views on different topics. Although there were different ideas about the specific timing, most, if not all, expressed a clear commitment to concluding these negotiations as quickly as possible,” the chair said at a meeting of the Negotiating Group on Rules following two weeks of consultations with members on key provisions in the draft agreement and on next steps.
Under the mandate from the WTO’s 11th Ministerial Conference held in Buenos Aires in 2017 and the UN SDG Target 14.6, negotiators have been given the task of securing agreement on disciplines to eliminate subsidies for illegal, unreported and unregulated fishing and to prohibit certain forms of fisheries subsidies that contribute to overcapacity and overfishing, with special and differential treatment being an integral part of the negotiations.
“Although MC12 has not yet been held, the text remains on Ministers’ desks, and we thus need to apply a high standard and discipline as we continue the work of the Negotiating Group,” the chair said.
China acceded to the WTO on 11 December 2001, becoming its 143rd member, following 15 years of accession negotiations. The high-level forum to mark the anniversary, entitled “20 Years of China’s WTO Membership: Integration & Development”, was jointly opened by WTO Director-General Ngozi Okonjo-Iweala and Ambassador Chenggang Li, Permanent Representative of China to the WTO. DG Okonjo-Iweala said that China’s accession to the WTO in 2001 was a “pivotal event in the history of the multilateral trading system”. Over the past twenty years, she said, China has been “a textbook case for how global trade integration can drive growth and development — the country’s economic rise has lifted millions out of poverty, not only within China but also in China’s trading partners across the developing world.”
It is my great pleasure to join you for this international conference under the auspice of the WTO Chairs Programme dedicated to advancing our understanding of the “Impact of COVID-19 on micro, small and medium-sized enterprises (MSMEs)” as well as the opportunities and challenges arising from a shift to an inclusive and sustainable blue economy for all.
The Covid-19 pandemic is having unprecedented impacts across the globe, especially on human health and economic activities. Governments are intensifying their efforts to combat the global spread of COVID-19 variants by enacting various measures to support public health systems, safeguard the economy and to ensure public safety. However, many developing and least developed countries are in lack of financial means to sustain their economies and protect the most vulnerable. Numerous micro, small and medium-sized enterprises succumbed to the shock and this had severe impact on the jobs situation and people welfare.
Small Island Developing States (SIDS) such as Mauritius have been facing the same challenges as other developing countries, if not more than others. The sanitary measures during the pandemic entailed a very high cost for the economy. According to the African Development Bank, Mauritius lost 18 percent points of growth in 2020, largely due to the disruption to tourism and hospitality industry in the country. While the economy recovered in 2021, the risk remains if new waves of COVID-19 lead to another temporary interruption of air links between Mauritius and Europe, the country’s main tourists source region.
At the WTO, Members have been considering MSMEs-related issues through policy dialogues and outreach events like this one organised under the auspices of the Chairs Programme. There are also focused discussions within the Informal Working Group on MSMEs. Just last Thursday, the Group launched its Trade4MSMEs online platform. It links to trade-related information to guide MSMEs through the complex process of trading internationally and to improve policy makers’ understanding of challenges faced by small businesses. I strongly encourage the authorities, businesspeople and relevant stakeholders of Mauritius to make use of the information there to promote the recovery and development of MSMEs in the country.
The 16th Internet Governance Forum (IGF) concluded on Friday in Katowice, Poland, with a call to urgently connect the 2.9 billion people who still cannot access the Internet and to make the global network an open, free and safe space where everyone’s human rights and basic freedoms are respected.