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The African Continental Free Trade Area or “AfCFTA”, launched last year in terms of the African Continental Free Trade Agreement, created the largest free trade area in the world measured by the number of countries participating, with the potential to unite 1.3-billion people and with a combined GDP valued at USD3.4-trillion, according to the World Economic Forum. The expansion of foreign and intra-African trade and investment has resulted in the increasing prominence of arbitration as an effective mechanism for resolving cross-border disputes that involve parties, legal representatives and arbitrators from different legal and cultural backgrounds.
Will South Africa finally ignite minerals and energy growth engines in 2022? (Engineering News)
Problems in South Africa’s electricity sector will, sadly, continue to dominate the headlines and undermine growth and confidence in 2022. Despite the fact that the crisis is now deep into its second decade, there is little sign of immediate relief and load-shedding remains a clear and present danger.
Zimbabwe seeks enhanced trade with Namibia (The Namibian)
A ZIMBABWEAN business delegation recently visited Namibia to enhance business ties and explore import and export opportunities between the two countries, as well as the storage of products at the Zimbabwe Dry Port.
“Our aim is to engage the Namibian business community to explore opportunities and the viability of using the Port of Walvis Bay as an alternative, and the Zimbabwe Dry Port facility for exports and imports to and from Zimbabwe. We are targeting increased trade with Namibia through strategic partnerships with local companies in the transport and logistics sector, and we are confident that our engagements will yield positive outcomes,” said BAK’s managing director logistics Mary Machingaidze.
The Zimbabwe Cross Border Traders Association (ZCBTA) has castigated local producers of goods for unjustified exorbitant pricing and called for unfettered access of imported goods into the market to bring fair pricing. Prices of goods have been skyrocketing with local producers attributing this to increased cost of production due to the hyper-inflationary macro-economic environment in the country. However, some increases have not been justified, but merely profiteering-driven.
“It is common knowledge that price distortions and exchange control instability benefit cartels and elite in the corporate sector hence their hesitation to address economic ills,”
“Given operating space, cross border traders can bring sanity in this area, if the Government temporarily lifts import restrictions on some basic commodities which are being overcharged and allow cross border traders to freely import these goods.”
The Government of Ghana has through the Trade and Industry Ministry signed a Memorandum of Understanding (MoU) with Rwanda to deepen bilateral trade relations between the two countries. Speaking at the signing ceremony of MoU on trade and economic cooperation at the Africa Trade House on Thursday January 27, the minister of Trade Alan Kyerematen expressed optimism that the agreement signed will develop into a strong and mutually beneficial relationship between the two countries. He noted in his speech the significant role Rwanda has played in some of Africa’s business-oriented policies including the establishment the African Continental Free Trade Area (AfCFTA).
The Minister, whiles acknowledging the seemingly low level of trade between Ghana and Rwanda despite their good relations over the years, indicated that he hoped the signing of the MoU will change that narrative.
Rwanda will re-open on Monday a border crossing with Uganda that was shuttered nearly three years ago, even as tensions rise between the central African neighbours, fuelled by accusations of espionage and support for each other’s dissidents. Rwanda had repeatedly accused Uganda of supporting rebel groups planning to topple the government in Kigali while Kampala accused Rwanda of carrying out illegal espionage activities in Uganda. In a statement on Twitter on Friday, Rwanda’s foreign ministry said the country would re-open the common border on Jan. 31.
African Export Import Bank (Afreximbank) has concluded a landmark 10-year, dual tranche facility of €200 million and US$166 million for the Government of Uganda. The transaction was structured using the Bank’s innovative specialised finance solution, introduced to facilitate access to long term finance by African sovereigns and other eligible entities.
The transaction, which is the first of its kind to be implemented by an African Multilateral Financial Institution, will greatly assist Uganda in achieving its trade infrastructure development and industrialisation objectives, thereby promoting the growth of Uganda’s exports and contributing significantly to the country’s economic growth and development in line with its National Development Plan.
PRESIDENT Muhammadu Buhari has said that local manufacturing firms have made Nigeria self-sufficient in cement production. The president, who made the disclosure at the inauguration of new BUA Cement Plant of three million metric tonnes in Sokoto State on Thursday, praised the manufacturing plants for creating thousands of jobs. Nigeria’s cement production capacity has exceeded 40 million metric tonnes, with Dangote Cement the industry leader, followed by BUA and Lafarge. The country has met local demands and is currently exporting to African countries.
The president of the Africa Development Bank (AfDB), Mr. Akinwunmi Adesina, at the recent Mid-Term Ministerial Performance Review Retreat of the President Muhammadu Buhari administration, which held in October 2021, presented what he proposed as a roadmap for Nigeria’s economic recovery. Among the many recommendations, the need for the Federal Government to significantly boost productivity and revenues from its non-oil sector, with appropriate fiscal and macroeconomic policies that will enhance international competitiveness was particularly instructive. He stated further that “Significant support should be directed toward boosting industrial manufacturing capacities.” Nigeria, he opined, should also move rapidly to the top of selected value chains, such as automobiles, computers and electronics, textile and garments, and food manufacturing, transport, and logistics.
African trade news
Manufacturing in Africa needs a strong regulatory framework (Mail & Guardian)
Success towards resource mobilisation and infrastructural improvements aimed at establishing in-country vaccine production is steadily moving on an upward trajectory in some countries in Africa. New Covid-19 infections have been on the rise, accelerated by low vaccination rates and the emergence of new variants. However, some countries have made concerted efforts to renew their emergency preparedness and response to better address challenges and embrace the opportunities presented by the pandemic.
The African Medicines Agency (AMA) is an initiative that will enable a continental harmonisation of regulations relating to the manufacturing of vaccines and other medical products. The Agency is a collective effort aimed at spurring local pharmaceutical production by establishing a supportive structure in which all member states can work together to respond to current and future emergency health crises such as Covid-19.
The lack of regulatory harmonisation at continental level is one of the major barriers to realising local vaccine production and ensuring effective regional integration to address health emergencies and the development of adequate pharmaceutical products. The delay in ratifying the AMA treaty means that member states and their in-country national regulatory authorities continue to be faced with constraints from conflicting legislation, lack of capacity building, technology transfer and adequate skills to set up local vaccine manufacturing processes, insufficient domestic financing to respond to public health crises and prolonged dependency on high income countries’ support in responding to current and future health emergencies.
The Southern African Development Community (SADC) Protocol on Trade in Services has entered into force. This was announced by the Executive Secretary of SADC His Excellency Mr Elias M Magosi in his notification to the 16 Member States of SADC,
he SADC Protocol provides the framework for a preferential trade agreement covering all commercial and tradable services in any services sector. The Protocol aims to encourage increased intra-regional trade in services through the gradual removal of unnecessary or overburdensome regulation affecting the cross-border supply of services within the SADC region, a process known as progressive liberalisation. Barriers to trade in services are found in the way that nations regulate services, e.g. through a country’s banking or transport laws, where measures may be found that limit the ability of foreign services suppliers to trade freely across borders, or which discriminate against foreign service suppliers within the market place and distort competition in favour of domestic suppliers.
The first round of such sectoral negotiations was concluded in 2019 covering communication, financial, tourism, transport, construction and energy-related services. A second round of negotiations was approved by SADC Trade Ministers in 2021, covering regional trade in the remaining sectors, namely: business services; distribution; educational, health and social services; environmental services; and recreational, cultural and sporting services. The adopted first round Lists of Commitments/Schedules comprise of commitments in the six priority sectors by all Member States except for outstanding schedules by Mozambique (in relation to energy-related services), Madagascar (construction and energy-related services) and Angola and Comoros - yet to become party to the Protocol (all six sectors). Member States have agreed to negotiate the outstanding offers in the six sectors during the second round of negotiations.
The race to rail: Africa’s fastest trains (The Citizen)
African governments are ramping up the development of railway infrastructure through multi-billion dollar deals and replacing fleets of outdated-diesel powered locomotives with electric ones in a race to place faster trains on its tracks.
Ever since Abbas the First, opened Africa’s pioneering railway in Egypt in the 1850’s, the primary mission behind the continent’s railways has been clear - to stimulate trade. Railways are now being seen as a key catalysts for intra-African regional trade and to more efficiently move large numbers of people between key cities. African governments at the national, state and city level are getting behind rail and even competing on the quality and speed of their networks. An ambitious multi-million US dollar African Union project christened the “African Integrated High-Speed Railway Network” (AIHSRN) is adding impetus to the rollout of high speed trains.
African travellers now require a visa to access just over half of the continent’s countries. This is according to the African Visa Openness Index (AVOI) report which measures the extent to which African countries are open to visitors from other African countries, produced jointly by the African Development Bank (Bank) and the African Union Commission (AUC) since 2016. The latest findings show for the first time since the AVOI was published, openness levels dropped slightly in 2021, after some governments temporarily reversed their liberal visa regime partly in reaction to the Covid-19 pandemic and largely to respond to recent instability in their countries.
SADC, SACU and prospects of regional integration (The Herald)
This article focuses on the Southern African Development Community (SADC) and the South African Customs Union (SACU), the two bodies that exist side by side in Southern Africa. The two bodies have the potential to play an important role in regional integration, but a lot still needs to be done to ensure they become more effective, especially through harmonising their operations.
SACU provides for the adoption of common policies and strategies among its members and recognises the crucial role tariffs play as an instrument for regional integration and development. While both SADC and SACU strive to ensure regional integration is advanced, one issue that stands out is the duplication of their membership — will all the five members of SACU also belong to SADC?
Member countries from SADC and SACU have been known to disagree on several issues and to argue for adoption of positions in cohorts, thereby dividing opinion on regional integration. Yet, the major roles of both SADC and SACU as stated in various of their protocols is to enhance regional integration among countries in Southern Africa through co-operation in economic, political, social and cultural spheres. The aim of both organisations is to enhance development within the Southern African region, while linking up with other regional groupings on the continent and eventually the African Union. In the presence of both SADC and SACU, it has become clear that full regional integration still remains outstanding.
On the economic front, the region has made some significant progress, as all member states now have faith in market oriented economic policies through which they are gradually opening up for trade both within the region and outside the region.
SACU has registered its own successes on tariff liberalisation and establishing advanced integration when it comes to a customs union. Apart from the customs union, the organisation has a common external tariff and four of its members – South Africa, Lesotho, Eswatini and Namibia – have a common monetary area that recognises the South African rand as a common currency. The common monetary area encourages integration among the member states as they can produce goods and services at par and trade without problems of weighing the advantages and disadvantages of currency exchanges. SACU also boosts of a legal framework that seeks to expand integration through coming up with a common industrial development policy, co-operation in agriculture and mutual agreement on competition policies. Looking at the bigger picture, it is the contradictions in regional integration that arise as a result of the existence of SACU alongside SADC that raises concern.
Both have similar goals anchored on enhancing development and regional integration in the region.
Africa urged to take bold action on fisheries (The Namibian)
A SENIOR official at the Southern Africa Development Community (SADC) says the African Union’s Fish Governance II project will help African countries, regional economic communities and regional fisheries bodies to provide consistent responses to the challenges facing the fisheries and aquaculture sector. Motseki Hlatshwayo, the senior technical adviser for fisheries and aquaculture at the Gaborone-based SADC secretariat, made these remarks at a media training workshop on fisheries management and aquaculture development in Africa on Zanzibar’s Indian Island recently. The workshop was part of the AUs Fish Governance II project funded by the European Union (EU). Hlatshwayo said the sector has been impacted by a health crisis, and although it is on the road to recovery, there is much to be done to build resilience and enable actors in the fish value chain to ensure better adaptation. He said the Covid-19 pandemic has caught the world off guard.
“This has given rise to concerns... such as the supply of fish as priority health-related interventions to avoid malnutrition and gender inequalities, investment opportunities, and governance mechanisms to effectively combat the pandemic,” Hlatswayo said.
THE Common Market for Eastern and Southern Africa (Comesa) has called for the strengthening of small to medium enterprises (SMEs) participation in regional production and trading of fish as part of strategies to growing the aquaculture value chain. The Comesa Secretariat, through the Regional Enterprise Competitiveness and Access to Markets Programme (RECAMP), is already working on strategies to improve and strengthen SMEs involvement in fisheries and fish product value chains in the regional and international markets. This will be done through sustained supplies, improved trade efficiencies, enhanced value chains and quality of products, said the 21 member bloc in a latest update.
EAC rolls out plans for $900m fruit and vegetable exports (The East African)
The East African Community has unveiled a strategic plan to double its fruit and vegetable exports to $900 million in the next eight years. In the 2021-2031 strategic plan that was unveiled late last year, the region plans to increase the area under fruit production by five percent, to 10 million hectares, with an eye on the global export market. If implemented, the intra-EAC trade in fruit and vegetable products would increase from the current $9.9 million to $25 million by 2031.
According to the East African Community Fruits and Vegetables Value Chain Strategy and Action Plan 2021-2031, the volume of EAC trade in the market is about 1.28 million tonnes per year. “This sector has the potential for huge investments, and provides an economic opportunity for reducing rural poverty in the EAC,” Mr Bazivamo said. “The most direct contribution is through generating higher incomes for farmers.”
“The sector has a significant role in promoting the EAC industrialisation agenda. Thus the market for processed fruits in the EAC is among the most promising, with sector maturity still far off into the foreseeable future,” Mr Bazivamo said.
Africa faces shortage of goods as China ports shut on Omicron surge (Business Daily)
The partial closure of a number of ports in China as a result of the rising cases of Omicron variant is expected to cause a serious shortage of commodities globally in the next few weeks with Africa expected to be the most affected region.
China’s northeastern city of Dalian reported its first case of Omicron last week where two people who travelled there from Tianjin confirmed to have Omicron, becoming the second major Chinese port struck by the highly contagious variant after Tianjin, a port neighbouring Beijing. China-Africa trade reached $185.2 billion between January and September of this year, up 38.2 percent year on year.
The East African Community Secretariat has embarked on capacity building on Standard Operating Procedures (SOPs) for plant health inspectors at its One-Stop Border Posts (OSBPs) to ensure that the region is protected from threats of pest infestation against key agricultural commodities.
Speaking when he officially opened a capacity building workshop for plant health inspectors at the Kabanga-Kobero OSBP bordering Tanzania and Burundi, the EAC Director of Productive and Social Sectors, Mr. Jean Baptiste Havugimana, said that the initiative on PRAs commenced more than one decade ago. “The first activity we embarked on was the development of pest lists. The second stage entailed development, validation and adoption of PRAs for maize, beans and rice,” said Havugimana, adding that the Sectoral Council on Agriculture and Food Security held in June 2021 adopted the SOPs for operationalizing the PRAs three key agricultural commodities. “Utilization and application of the SOPs at the border points by plant health inspectors is a turning point in the entire process,” said Mr. Havugimana.
ACFTA: Yaoundé to host a regional forum to improve support in the cassava sector (Business in Cameroon)
Yaoundé, the capital of Cameroon, will host from January 31 to February 1, 2022, a regional forum aimed at improving support for Central African small businesses involved in cassava production and export, in the framework of the African Continental Free Trade Area (ACFTA). Organized jointly by the Economic Community of Central African States (ECCAS) and the State of Cameroon, the forum will be an opportunity for stakeholders in the cassava sector (farmers, processors and SMEs, and entrepreneurs) to discuss the challenges and opportunities offered by the ACFTA in terms of processing, added value, and innovation. It will also promote good social and environmental practices as well as the creation of decent jobs, for women and young people particularly.
President Paul Kagame has said that young Africans should leverage available technology to create jobs and integrate into the European labour market without necessarily migrating to other countries. He said this while addressing the Talking Africa Europe debate on migration and mobility in Africa-Europe partnerships, on Thursday, January 27. Organised by the Africa-Europe Foundation, the discussion is among other topics prepared to pave the way for the upcoming African Union-European Union Summit. Kagame said there are several reasons why Africans migrate to Europe, “some of them are justified, others are not, but they are either political, economic, security, all wrapped up on matters of governance.”
The elephant in the room: Bringing sustainable investment to Africa (World Bank Blog)
The coronavirus pandemic has renewed interest in sustainable investing strategies that allow investors to both protect the financial value of their assets and contribute to solutions to global problems such as climate change. These investments have become increasingly mainstream, and now account for more than $39 trillion in the five major global markets, a 34 percent increase over two years, according to the latest trends reported by the Global Sustainable Investment Alliance.
Attracting sustainable investment is a key challenge for the region for several reasons. First, while climate change and associated physical risks will be felt by all countries, some the most severe temperatures are predicted to occur in Sub-Saharan Africa. The region is also directly and indirectly exposed to the transition risks associated with climate change, which is amplified by the dependence of many economies, and jobs, on minerals, energy and mining. In addition, financial sector regulations that are rapidly being rolled out in the European Union and are being harmonized globally will impact all companies that are part of the supply chains that intersect with African countries.
Making trade more inclusive by supporting the integration of women in international trade is a way to achieve this. And it is at the heart of the WTO’s work today. We are seeing the proliferation of gender-related provisions – or gender mainstreaming – in free trade agreements. This is an important tool for promoting inclusive trade, gender equality, and sustainable development. And since free trade agreements often serve as laboratories of innovations that later get implemented at the multilateral level, in the future, we may see some of these provisions making their way into the WTO rule book. I am happy to share that the WTO has prepared and will soon publish a comprehensive database detailing gender provisions included in all trade agreements since the Treaty of Rome of 1957. This was the first trade agreement that introduced the principle of equal pay for men and women.
The General Council Chair called the meeting following weeks of consultations with delegations on the way forward. In those conversations, members were of the view that only a holistic, comprehensive and balanced outcome on the WTO pandemic response would be credible. Delegations expressed willingness and eagerness to continue working on this crucial topic, with the objective of achieving results, and to do so without delay, he said.
On the trade-related angle, DG Okonjo-Iweala stressed that most delegations see the facilitator’s text as the basis to proceed despite the existing divergences. She said that “with goodwill those who have difficulties with it will be able to get their views in and get this resolved.”
Constant shifts in the global reality have challenged human development to exceed average expectations. From tackling innovative sustainable growth barriers to managing the global upkeep with rapidly transforming digital technologies, there is a consistent need for economies to collaborate, innovate and change for the betterment of their societies. In light of these necessary changes, there is an overlapping conversation that demands that particular attention be given to the development concerns and challenges of the Global South. The provision of enhanced frameworks that facilitate social, economic and political cooperation on every level among countries of the Global South has become an ever-more significant topic on the global stage. As the Global South becomes an increasingly important driver of the world’s economy, South-South and intraregional trade become more central to development discourse. To facilitate and strengthen cohesion among growing economies in the Global South, cross-country networks encouraging competitive business environments is key.
Investment facilitation is becoming increasingly important for countries to attract international and local financing for sustainable development. As negotiations on a possible investment facilitation agreement progress in Geneva, UNCTAD’s monitoring shows that countries are already making progress on the ground.
Progress has focused on information provision, regulatory transparency, and streamlining of administrative procedures for investors through digital information portals and single windows. These tools, which have increased in both coverage and quality over the past 5 years, represent the most impactful elements among the gamut of investment facilitation measures. Since 2016, the number of countries with digital information portals increased from 130 to 169 and those with digital single windows from 29 to 75. Developing countries are catching up. Their use of digital information portals and single windows has jumped. While on average their ratings are lower, several achieve top marks, often with technical assistance. UNCTAD’s data shows that most countries - including those outside the negotiations - recognize the importance of investment facilitation to revive stagnant cross-border investment in industry, absorb an expected global push for investment in sustainability and infrastructure, and remain competitive as international tax reforms reduce the scope of fiscal incentives.
It is no secret that the World Health Organization (WHO) is grossly underfunded. As its Executive Board meets this week to discuss how it can become the global health institution the world needs and wants, all eyes will be on whether the WHO can finally solve the problem of its precarious financing. But there is even more at stake in this debate than the WHO’s own financial health. If a financial fix can be found for what ails the WHO, there will likely be ripple effects for the ways member states fund entities across the United Nations system whose funding structures are equally shaky. It is the possibility of these downstream consequences – including the potential liabilities that action at the WHO could place on reform efforts in other UN entities – that is one of the greatest political challenges to fixing the WHO’s balance sheet. Nevertheless, this is a Pandora’s box worth opening. The lack of predictable and flexible finance for a sickly UN multilateral system is a problem in urgent need of a solution.
Food security must remain the central focus during G20 meetings so that global food security can be achieved in the face of challenges posed by climate change, among others, Agriculture Minister Syahrul Yasin Limpo has said.
The global pandemic has presented challenges of food and nutrition security due to restrictions on the movement of goods and services at the local, regional and global levels, the minister noted. “Logistics flow and the food distribution system have also been severely affected. Meanwhile, several countries have implemented protection policies through national stocks, which have had an impact on the imbalance in the global food system,” he said.