tralac Daily News
South Africa recorded a trade surplus of R35.83 billion in November, from a revised surplus of R27.68 billion in October, the South African Revenue Service (SARS) reported on Tuesday. According to Trading Economics, the November surplus was well above the market's consensus expectation of only R16.8 billion. South Africa saw a year-to-date trade balance surplus of R412.51 billion, from a surplus of R238.42 billion in the same period in 2020. This was largely due to booming commodity prices, which pushed up the value of mining exports. Exports increased by 18% year-on-year, while imports increased by 25% over the same period.
Kenya’s food imports bill rises fastest in four years (Business Daily)
Kenya’s food imports’ bill in the first nine months grew fastest since 2017 driven by a rise in the food products shipped by industries for processing before selling in the local market. The latest data from the Kenya National Bureau of Statistics (KNBS) shows that the food import bill rose 21 percent to Sh155.42 billion from Sh128.06 billion in 2020. The data shows that imports of food products drove the increase as industries sourced more for value-addition before selling in the local market. This is the fastest growth in the food import bill in the first nine months since a 60 percent jump posted in the same period in 2016 when the bill stood at Sh82.83 billion.
Kenya’s exports to Ethiopia up 68 pc on increased food consignments (Capital Business)
Exports to Ethiopia more than doubled rising by 68 percent in the third quarter of 2021 compared to a similar period in 2020, data released by the Kenya National Bureau of Statistics (KNBS) has said. The increment from Sh 1,927 billion to Sh 5,963 billion was attributed to the rise to increased food exports to the East African country which has been hit by a political crisis over war between government forces and the rebel Tigray People’s Liberation Army (TPLF) in the north of the country.
Overall, the Balance of Payments report prepared by KNBS noted that Kenya’s export value rose by 7.5 percent with Africa accounting for the highest value at Sh78,389 billion. “This growth partly resulted from increase in the value of domestic exports of food preparations for infants to Ethiopia and electric generating sets and converters to Tanzania,” the report noted.
Tanzania’s trade surplus across the East African Community region rose to $484.5 million in 2020, from $343.8 million the previous year, according to latest updated central bank figures. The country also reported a highly-improved trade surplus of $1.09 billion with Southern Africa Development Community (SADC) countries, indicating a further expansion of its sub-Saharan trade network. Kenya remained Tanzania’s main trading partner within the EAC bloc, accounting for 28.4 percent of intra-EAC exports and 76.4 percent of imports in 2020. Export figures to Rwanda, Uganda and Burundi also rose sharply while imports from those countries dwindled.
According to the Bank of Tanzania’s 2020/2021 Annual Report released on December 31, Tanzania exported goods worth $811.2 million to the EAC region in 2020, up from $678.5 million in the previous year, while imports from the bloc declined slightly from $334.7 million to $326.7 million.
The trade balance for 2021 posted a deficit of 16, 215.1 million dinars (MD) compared to 12,757.8 MD in 2020. The coverage rate fell by 1 percentage point compared to last year, reaching 74.2%, the National Institute of Statistics said Tuesday in its Foreign Trade at Current Prices December 2021 note. The deficit was driven by high imports, particularly from China (-6,325,5 million), Turkey (-2,655,9 million), Russia (-1,440 million) and Algeria (-1,554,4 million). Meanwhile, the trade balance of goods showed a surplus mainly with France (4,001,2 million), Germany (1,860 MD) and Libya (1,588,5 million). The trade balance excluding energy declined to - 10,995.9 MD, while the energy trade balance shrank to -5,219.2 MD (32.2% of the total deficit) against -4,200.5 MD in 2020.
How vehicle imports jumped by 40% in 2021 – Expert (Daily Trust)
Managing Partner, Transtech Industrial Consulting and former Acting Director-General of the National Automotive Design and Development Council (NADDC), Luqman Mamudu
How would you rate the performance of Nigeria’s automotive sector in 2021? On a scale of 1-10, I will say 5.
Once the National Automotive Industry Development Plan was launched in 2013/14, activities with new entrants gradually ramped up to about 500,000 installed capacity or 700 percent jump but capacity utilization remained low at less than 4 percent or 15,000 vehicles per annum. Meanwhile, Nigeria import averaged 400,000 vehicles annually from official customs statistics but smuggling activities were prevalent. All vehicles destined for Nigeria were shipped to Cotonou and neighboring countries and gradually smuggled in. This remained the case between 2017 to 2020 as assembly activities and potential to increase capacity utilization remained undermined by the increased importation of used vehicles from scraps yards of Europe, North America, etc.
There was hardly any positive change in 2021 except that some significant Global Motor Companies like Gilly, XCMG, and new local brands joined the ranks of local assemblers. The industry suffered a significant setback with the passage of the 2020 Finance Act which completely shut down assembly.
Domestic trade news
Traders defy duty-free sugar import quota, raising prices (Business Daily)
Traders breached the limit the Treasury set on duty-free sugar imports and shipped in 25.4 percent above the quota by the end of last November, subjecting the consumers to costly sweetener. According to the Sugar Directorate, traders imported 263,988 in the review period, exceeding 210,530, which is the limit that the Treasury set for sugar coming in from Common Markets for Eastern and Southern Africa (Comesa). The breach of quota could be the force behind the current expensive sugar in the market as the Kenya Revenue Authority (KRA) was to charge 100 percent duty on imports above the limit, as directed by the Treasury.
“Total sugar for the month amounted to 61,458 tonnes. The white refined sugar was 22,390 tonnes while mill white/brown was 39,068 tonnes,” said the directorate.
Kenya acquires $28.9m tugboat, cranes for Mombasa port (The East African)
Kenya becomes the second African country after South Africa to own salvage boats after the Kenya Ports Authority (KPA) acquired a $16.65 million multipurpose salvage tugboat and three ship-to-shore gantry cranes at $28.9 million. The salvage tugboat bought from Turkey and three ship-to-shore gantry cranes from Japan will boost efficiency and bulk handling activities at the second container terminal. This follows President Uhuru Kenyatta’s order for port efficiency to boost businesses in East Africa.
Mobile money agents handle Sh6.2 trillion in 11 months (Business Daily)
Cash transacted by mobile money agents jumped 36 per cent to Sh6.2 trillion in the nine months to November. Data from the Central bank of Kenya shows transactions at the agents rose from Sh4.6 trillion in a similar period a year earlier, indicating their growing use during the pandemic. Mobile money agency business has been booming especially as banks seek alternatives for brick and motor channels to reach their customers. Kenyans have increased reliance on mobile money agents for transactions from an annual Sh2 trillion six years ago. For four years between 2016 and 2019 Kenyans transacted Sh3 trillion on average as transactions grew modestly below 10 per cent.
However the increase has been pronounced since 2020 when transactions grew 16 per cent following the outbreak of the Covid-19 pandemic that shifted more customer settlements to mobile, boosting agency businesses that supports the sector.
The Republic of Uganda has committed to conduct free Covid-19 rapid tests at the Kenya-Uganda border points of Busia and Malaba for (seven (7) days to clear the truck traffic snarl-up that has disrupted intra-EAC trade on the Northern Transit Corridor. This follows a joint multi-sectoral virtual meeting of the Ministers/Cabinet Secretaries responsible for EAC Affairs, Health and Transport convened by the EAC Secretariat. Currently, over 4,500 trucks have stalled at the two border posts due to the mandatory Covid-19 testing requirement introduced by Uganda on 20th December, 2021. The meeting noted that this was a deviation from the 14 days Covid-19 testing period, previously agreed at the regional level and monitored through the Regional Electronic Cargo and Drivers Tracking System (RECDTS).
Nigeria prepares to play a central role as it embraces intra-African trade (Global Banking And Finance Review)
Nigeria, Africa’s largest economy, has long looked beyond the continent for trade partners. Indeed, trade flows between African nations have historically been low across the board, accounting for less than 17% of overall trade volumes – a figure dwarfed by the proportion of intra-continental trade found in Europe or Asia. In 2020, just 19% of Nigeria’s exports went to other African markets, while 8% of imports came from the continent.
But the country is now placing a renewed focus on deepening links with its neighbours. Greater regional trade integration within Africa has been an important policy priority for years. Intra-African trade is regarded as a powerful stimulant of economic growth, with the added benefit of bolstering African economic resilience by reducing exposure to global price fluctuations. For Nigeria, an increase in trade with African partners would represent an opportunity for local industries to achieve scale, and for the economy to reduce reliance on the currently dominant oil sector.
Negative reactions trail Customs’ 2021 revenue figure (New Telegraph)
In trade facilitation, Nigeria Customs Service (NCS) is required to adhere to valuation on imported goods and other aspects of international trade, including statistics, quota and licensing arrangements, taxes and other charges levied on imports. However, placing revenue generation above trade facilitation has been one of the major challenges faced by importers and exporters at the seaports and borders under the guise of protecting local manufacturing firms.
For instance, some of the tariffs used by Customs, such as five per cent duty on raw materials, 10 per cent on intermediate goods, 20 per cent on finished goods, 35 per cent on imports into strategic sectors, levies, excise and valued added tax (VAT) have posed major obstacles to trade facilitation, leading to false declaration, undervaluation, concealment, undervaluation, false description of imports, under invoicing, smuggling of banned items, erratic application of customs regulations, lengthy clearance procedures, high berthing and unloading costs and corruption.
“Ultimately, the economic integrity between Nigeria and neighbouring, Benin Republic has to be seriously reviewed. The fact that they aren’t consuming the rice but they keep importing it, is a calculated attempt to undermine Nigeria,” these are the words of Comptroller Dera Nnadi, the Area Controller of Ogun 1 Command, Nigeria Customs Service (NCS).
John Isemede, former Director General of Nigerian Association of Chambers of Commerce, Industry, Mines and Agriculture (NACCIMA), has said that for Nigeria to benefit from the African Continental Free Trade Area (AfCFTA) it must add value to its agricultural products before export. He noted that Nigeria is ripe to process raw/crude in finished products with value addition to run the chain with the rest of the world. In an interview with Financial Vanguard Isemede stated: “For us to achieve this we must add value to our raw materials, remove all the restrictions, all the roadblocks, provides incentives and support to manufacturers.
The emergence of the COVID-19 pandemic in the first months of 2020 amplified the symptoms of the economic crisis that the oil-dependent Angolan economy was already undergoing since 2014. Short term prospects for the recovery of the domestic economy are strongly correlated with the global evolution of the pandemic and trends in international oil markets. International oil market volatility is further compounded by global uncertainties surrounding the availability of vaccines to developing countries in the face of the appearance of new and more contagious strains of the COVID-19 virus.
On 29 December 2021, the Federal Customs Commission of Ethiopia (ECC) notified the WCO Secretary General that the new edition of the Harmonized System (HS 2022) would enter into force in the country on 1 January 2022. Ethiopia has thereby become the first African country to have submitted a notification on the implementation of HS 2022 amendments to the WCO. In the notification letter, Mr. Debele Kebeta Hursa, the ECC Commissioner, thanked the WCO and the European Union for the support provided to Ethiopia in the framework of the EU-WCO Programme for Harmonized System in Africa (HS-Africa Programme), funded by the EU. He stressed that the assistance received from the WCO did help the ECC to migrate to the HS 2022 version in a timely manner, and expressed his hope that this co-operation with the WCO would continue.
Egypt is in a position to become a regional player in the medical apparel sector; however, first several constraints and challenges need to be mitigated, a new study by the International Trade Centre revealed. The country can unlock significant local demand and tap into a large export market if it is able to organize its domestic market and institutions, potential valued of $18.6 billion.
Intra-African trade among selected sectors under industry, energy, mining and agriculture are expected to increase by 30 percent during the implementation of the African Continental Free Trade Area agreement. The projected 30 percent increase in intra-African trade in the selected sectors according to a study by African Export and Import Bank (Afrieximbank), translates into over $1 billion increase in value of trade.
One year of the AfCFTA: What has worked and the way forward (Africa Renewal)
Since trading began on 1 January, some intra-African trade under AfCFTA arrangements based on anecdotal evidence has taken place, including alcoholic beverages and cosmetic products (recent data on trade flows are not yet fully available). Although intra-African agricultural trade remains below 20 percent compared to more than 60 percent for Europe and Asia, trade is projected to grow once negotiations have come to an end and trade barriers are progressively rolled back. To date, 42 out of 55 African countries have ratified the agreement, and 88 percent of the negotiations on product-specific rules of origin have been concluded, covering more than 70 percent of intra-African trade according to the AfCFTA Secretariat in 2021.
However, a significant shortcoming of the agreement is that many nutrition-sensitive goods may not be fully liberalised or progressively liberalised over longer periods, as indicated by ongoing negotiations on tariff offers. Examples of protected goods include live animals, meat, fish, milk and dairy products, fruit and vegetables, coffee, tea, spices, oilseeds and sugars.
The African Continental Free Trade Area (AfCFTA) celebrates its first anniversary on January 1, 2022. With exception of Eritrea, all African countries are signatories to the agreement. Over time, ratifying counties pledge to eliminate import tariffs on 97% of goods traded between African states. Many hope this will increase trade between African countries, which will in turn boost manufacturing and create jobs, bringing more prosperity and social equality to those on the continent. African nations currently trade more internationally than with each other. Intra-African trade accounts for 17% of African exports, which is low compared to 59% for Asia and 68% for Europe, according to the World Economic Forum. But AfCFTA wants to do more than just boost trade in goods — its scope includes services, investment, intellectual property rights and competition policy, although these aspects are still under negotiation.
You are always harping on the participation of African women and the youth in free trading. Why is that and are they hearing you? The reason I put a strong emphasis on young Africans and SMEs led by women is that, first, they are the drivers of the African economy. SMEs run by women account for close to 60 per cent of Africa’s GDP, creating about 450 million jobs. Also, young Africans are at the cutting edge of technological advancements, whether it is in Lagos or Kigali. They are developing the latest software to drive e-commerce and so on. We will be making a catastrophic mistake if we don’t include these important segments of our society in the implementation of this agreement. I believe that if we want to move away from the old models of trade agreements, trade agreements that were criticized as benefiting only the big corporations, we need to focus on young people and women-run SMEs. Let me also say that given the character of Africa’s economy and demographics, it would be ill-advised to have a traditional trade agreement, which focuses on trade in goods, trade in services, intellectual property rights, and so on. Therefore, we have a mandate from our Heads of State to negotiate a protocol on women and young traders. The trade agreement will not have credibility if you exclude important segments of society; it will be perceived to benefit only the elites.
2022: Africa’s practical realities on energy and climate change (Africa Renewal)
For African countries, however, the pandemic exposed the stark realities of global inequality. These countries scrambled to buttress their shattered food systems; they lacked industries to shift production to life-saving personal protection equipment even as young Africans were left out of schools because of lack of access to electricity and the internet, which made the shift to virtual learning almost impossible. The pandemic revealed how Africa, despite its best efforts, was unprepared for some of the pressing emergencies of our times, be it the pandemic or the looming threat of climate change. The UN Office of the Special Adviser for Africa is advocating for Africa to transition into 2022 with a sense of utmost urgency in building the continent’s resilience. We firmly believe that the foundational building blocks to this resilience lie in Africans’ access to reliable, affordable and sustainable energy.
What 2022 has in store for Africa (Chatham House)
2022 is already shaping up to be a year of mixed fortunes for Africa if the events of this first week are a harbinger. The continent launched the African Continental Free Trade Area (AfCFTA) in 2021 and emerged from recession, sparked for many by low commodity prices but worsened by the COVID-19 pandemic. Elevated commodity prices, a recovery in global trade, and the easing of stringent pandemic measures despite anxieties over the Omircon variant and low rates of vaccination, signal a trajectory of slow economic recovery and bodes well for corporate revenue and share price among African energy, metals, materials, and food producers.
The digital transformation of African goods and services and supply chains will also continue in 2022 but exchange-rate pressures with increased volatility, credit, and liquidity challenges are a key concern for many governments.
International Relations and Cooperation Minister Naledi Pandor says the devastating impact of the debt burden to the economies and sovereignties of several African states is hard to ignore. Pandor was responding to a written parliamentary question from EFF MP Thembi Msane, who wanted details on the African Union’s (AU) interventions to prevent African countries from losing their sovereignty to other nations through debts and loans. Pandor said, while AU member states determined their domestic priorities, the continental body continued its work with international lending institutions. She added that the devastating impact of the debt burden on the economies and sovereignties of many countries on the continent was hard to ignore.
EAC Secretariat is set to convene a multi-sectoral meeting on Monday 10th January 2022, to consider the adoption of the EACPass, a harmonized system to facilitate cross-border movement, in a bid to end persistent border traffic snarl-ups disrupting intra-EAC trade. The meeting will include Ministers responsible for EAC Affairs, Transport and Health. EAC Secretary General, Hon. (Dr.) Peter Mathuki, said that as the region strives to rebound from the Covid-19 pandemic, constant trade impasses at EAC border points were reducing the gains made in integrating the region, adding that Partner States need to prioritise the adoption of a regional coordinated approach in handling the pandemic. “Harmonization of Covid-19 charges and coordinated waiting time for Covid results is critical to facilitate business continuity and ease the cost of doing business,” said Dr. Mathuki.
This happens in the background of an ongoing trade impasse at the Kenya-Uganda border points of Busia and Malaba that has disrupted cross-border trade. The two borders on the Northern Corridor also serve Burundi, the Democratic Republic of Congo, Rwanda and South Sudan.
The World Trade Institute and COMESA have conducted a training course for COMESA Member States aimed at strengthening human and policy-making capacities on Trade in Services. The course took place virtually from 6 – 8 December 2021. It was attended by trade and trade law experts from Member States that deal in multilateral, regional and sub-regional trade negotiations, to sharpen their skills in analysis, formulation and implementation of Trade in Services policy frameworks.
Currently, all COMESA Member States are involved in negotiations on seven Trade in Services sectors that have been prioritized for liberalization namely: communication, finance, tourism, transport, business, construction and energy-related services.
DHL expands footprint into Sadc (NewsDay)
FREIGHT services provider DHL Global Forwarding has expanded its presence across the African continent, with the aim of giving local and regional businesses within Sadc access to global markets. The company said as a first step, DHL Global Forwarding set up a legal entity currently employing eight graduate trainees to align the sector with international standards synonymous with DHL and show the market the advantages of conducting business in a compliant manner. The new entity, it said, comprises a full suite of technology solutions and exceptional market knowledge meant to successfully address the challenges faced by the country’s freight forwarding and logistics industry.
Customs data plays a key role in supporting the operational efficiency of Customs administrations through effective management of Customs risks and improved facilitation in the clearance of legitimate trade. In recent times, some WCO member countries in the Southern African Development Community (SADC) had taken initiatives to work towards the interconnectivity of their Customs systems to enable exchange of Customs data and to leverage opportunities for mutual cooperation, improved data integrity and quality and systems interoperability. To this end, the WCO conducted a two-day virtual sub-regional workshop on Customs IT Systems Interconnectivity on 13 and 14 December 2021, under the Sida-WCO Trade Facilitation and Customs Modernization Programme with financial support from the Government of Sweden, to support the interconnectivity initiatives undertaken by the Customs administrations of Botswana, Eswatini, Malawi, Zambia and Zimbabwe.
Africa faces an uphill battle against western emissions to combat climate change (The Conversation UK)
The UN climate summit COP26, held in November 2021, focused the world’s attention on the urgent need to tackle climate change and concluded with 197 countries agreeing to the Glasgow climate pact. But opinions on the summit’s success are polarised.
African nations continue to hold the unenviable position of being disproportionately vulnerable to climate change. Although the continent accounts for the smallest share of global greenhouse gas emissions – only 3.8% – it’s already heating faster than the rest of the world. And if the target of limiting global warming to 1.5℃ above pre-industrial levels is missed, Africa could be facing catastrophic temperature increases of up to 3℃ by 2050. At the same time, the threat to GDP of African nations that are most vulnerable to these changes – meaning the amount of economic activity that stands to be lost if these changes are severe enough – is projected to increase from £660 billion in 2018 to over £1 trillion in 2023. That’s almost half of the continent’s projected GDP.
Sourcing Minerals for Africa’s Energy Transition (Energy Capital & Power)
Africa represents the second-largest mineral industry in the world, with many countries from the continent relying on mineral exploration and production to stimulate economic growth. Richly endowed with massive mineral reserves and ranking first in the quantity of several various mineral-types, the mineral industry contributes greatly towards Africa’s gross income. The global energy transition is shaping the mining industry, as priorities for an energy shift towards electric vehicle production, battery storage, and other green energy technologies, thus provoking a reduction in the world’s demand for fossil fuels. While nearly 50% of sub-Saharan Africa’s export value derives from the development and trade of fossil fuels, the continent is poised to prosper from its mineral energy resources such as nickel, copper, and cobalt. Minerals serve as essential components in many of the world’s fastest growing green energy technologies, with demand for these minerals expected to grow exponentially in the coming decades. Therefore, sub-Saharan Africa has a comparative advantage as the world begins its transition to clean energy sources, and as renewable technologies become cheaper and more readily available, there is indication that Africa will benefit exponentially from its mineral energy materials, particularly for countries with abundant sources of copper and nickel, such as the Democratic Republic of the Congo (DRC), Zimbabwe, and Zambia.
Africa’s energy strategy – GIS Reports (Geopolitical Intelligence Services AG)
Despite the worldwide impetus to replace fossil fuels with green energy, African countries are hoping oil and gas will remain in demand long enough for the continent to profit from its abundant resources.
In energy markets, volatility seems to be the watchword. Gas prices have dramatically increased in Europe. China has declared itself willing to “pay any price” to secure coal. Beijing has also joined the United States and other countries in tapping oil reserves to bring prices down. Africa, a continent that suffers from widespread energy poverty but that is also endowed with massive resources, will be affected by this turmoil.
energy poverty remains a major obstacle to growth. While it is home to 16 percent of the world’s population, the continent consumes just 3.3 percent of global primary energy. Not surprisingly, per capita emissions are estimated to be a fifth of the global average. Moreover, 600,000 of the 800,000 people estimated to live without access to electricity are in sub-Saharan Africa.
Sub-Saharan Africa lost R30bn due to govt internet shutdowns, report says (Engineering News)
Countries in Sub-Sahara Africa lost a combined R30.88-billion from their economies because of widespread internet shutdowns by regimes, as demonstrations and crackdowns on opposition and civic society ensued last year. This is contained in the Global Cost of Internet Shutdowns 2021 report, released on Monday.
Five African localities have published Voluntary Local Reviews (VLRs) of their frameworks and progress towards regional and global sustainable development goals. These VLRs – in Accra, Harare, Ngora District, Victoria Falls and Yaoundé – were supported by ECA and are among a first wave of local-level reviews undertaken across Africa, with many more on the way.
AGOA: What does the US decision to delist three African countries imply? (Ventures Africa)
Trade is one highly significant part of Africa’s story. Its pre-colonial, colonial and post-colonial transitions are all marked by trade. But for many years, African trade has struggled with several challenges: poor infrastructure, high transaction costs, opportunism and unfriendly policies. So when President Bill Clinton signed the African Growth and Opportunity Act (AGOA) in 2000, African countries were given a competitive edge by providing unilateral duty-free exports for 6,500 products from Africa to the United States. But that reality is changing for some countries. On January 1st, 2022, the US officially barred Ethiopia, Guinea and Mali from accessing the AGOA. The move comes two months after president Joe Biden told Congress that he plans to cut off the three countries from the program over coups and alleged human rights violations, which put them in violation of the program’s eligibility requirements.
As the world’s largest cargo ships rush to the United States with all the clothes, furniture, toys and electronics that American consumers might want, Aditya Awtani is feeling neglected. The chief executive of Mega Garment Industries Kenya, which supplies brands such as Calvin Klein and Izod, sometimes must wait more than two months — twice as long as usual — for shipments of the imported Chinese fabric he needs to make clothes in his high-ceilinged factory in Mombasa, Kenya. Awtani’s problems getting raw materials into Kenya are mirrored by his troubles getting Mega shirts, pants and children’s clothing out of the country. Shipping containers are scarce, since carriers often hurry them back to China, making it hard to plan and easy to miss scheduled deliveries.
Report Finds Trade Misinvoicing Continues to be a Massive and Persistent Problem (Global Financial Integrity)
A report published by Global Financial Integrity (GFI) finds an estimated US$1.6 trillion in potential trade misinvoicing among 134 developing countries, of which US$835 billion occurred between developing countries and 36 advanced economies, in 2018. This report, Trade-Related Illicit Financial Flows in 134 Developing Countries 2009-2018, shows trade misinvoicing is a persistent problem across developing nations, resulting in potentially massive revenue losses and facilitating illicit financial flows across international borders.
Following a strong rebound in 2021, the global economy is entering a pronounced slowdown amid fresh threats from COVID-19 variants and a rise in inflation, debt, and income inequality that could endanger the recovery in emerging and developing economies, according to the World Bank’s latest Global Economic Prospects report. Global growth is expected to decelerate markedly from 5.5 percent in 2021 to 4.1 percent in 2022 and 3.2 percent in 2023 as pent-up demand dissipates and as fiscal and monetary support is unwound across the world.
At a time when governments in many developing economies lack the policy space to support activity if needed, new COVID-19 outbreaks, persistent supply-chain bottlenecks and inflationary pressures, and elevated financial vulnerabilities in large swaths of the world could increase the risk of a hard landing.
The slowdown will coincide with a widening divergence in growth rates between advanced economies and emerging and developing economies. Growth in advanced economies is expected to decline from 5 percent in 2021 to 3.8 percent in 2022 and 2.3 percent in 2023—a pace that, while moderating, will be sufficient to restore output and investment to their pre-pandemic trend in these economies. In emerging and developing economies, however, growth is expected to drop from 6.3 percent in 2021 to 4.6 percent in 2022 and 4.4 percent in 2023. By 2023, all advanced economies will have achieved a full output recovery; yet output in emerging and developing economies will remain 4 percent below its pre-pandemic trend. For many vulnerable economies, the setback is even larger: output of fragile and conflict-affected economies will be 7.5 percent below its pre-pandemic trend, and output of small island states will be 8.5 percent below.
Landlocked developing countries (LLDCs) face many challenges to integrate into global supply chains. This report identifies trade bottlenecks in LLDCs and provides recommendations on how to keep trade flowing smoothly across borders.
Solving Maritime Challenges In 2022 (Leadership)
Maritime stakeholders thought the myriad of challenges facing the port system will end by year 2021 and operators can heave a sigh of relief. They believed challenges such as lack of port automation, overtime cargo fueling congestion at seaports, non refund of container deposit fee by shipping companies, non-disbursement of Cabotage Vessel Finance Fund (CVFF), resuscitation of National Shipping Line, introduction of Maritime Bank, and increased shipping surcharge by foreign shipping companies, will be solved by relevant agencies and authorities in the sector.
However, some stakeholders, e.g indigenous shipowners had lamented that foreign-operated vessels that engaged in Nigeria National Petroleum Corporation’s (NNPC’s) marine service contracts, accounted for over 90 per cent of the Cabotage trade, thus creating an uneven operating environment detrimental to the growth of indigenous tonnage.
Digital trade is increasingly important and comprises both digitally ordered trade in goods and services (cross-border electronic commerce (e-commerce)) and digitally delivered trade (services delivered internationally through the Internet or other networks). However, countries vary greatly in their readiness for digital trade. If the share of developing countries, particularly the least developed countries, in world trade is to increase, as envisaged in the 2030 Agenda for Sustainable Development, actions are needed to strengthen their capacity to benefit from digital trade. The coronavirus disease (COVID-19) pandemic has made this need even more urgent.
The International Air Transport Association (IATA) released data for global air cargo markets showing slower growth in November 2021. Supply chain disruptions and capacity constraints impacted demand, despite economic conditions remaining favorable for the sector. As comparisons between 2021 and 2020 monthly results are distorted by the extraordinary impact of COVID-19, unless otherwise noted, all comparisons below are to November 2019 which followed a normal demand pattern.
How barriers to trade can be barriers to climate change adaptation (VOX, CEPR Policy Portal)
A wide range of evidence suggests that global warming will have major effects on agricultural productivity throughout the world.
The exceedingly low levels of trade in poor countries stand as a critical barrier to climate change adaptation. Instead of agricultural specialisation shifting away from the hardest-hit regions as the world heats up, my model projections suggest that warming will keep more workers stuck on farms in hotter, poorer countries as falling agricultural productivity in these places exacerbates the food problem. As climate change makes people poorer and food more expensive, it raises the budget share and consequently the production share of agriculture in the absence of a major increase in food imports. With production remaining concentrated in the sector experiencing dramatic declines in productivity, people in these places project to suffer greatly.
UNCTAD takes the pulse of the SDGs (UNCTAD)
The purpose of this report, published on 2 July 2021, is to: provide an update on the evolution of a selection of official SDG indicators and complementary data and statistics; provide progress reports on the development of new concepts and methodologies for UNCTAD custodian indicators; and to also showcase, beyond the perspective of the formal SDG indicators, how UNCTAD is contributing to the implementation of 2030 Agenda. The report will also investigate thematic issues of relevance to 2030 Agenda – this year, the report discusses the remoteness as a challenge for achieving the 2030 Agenda.