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Copper could be the ‘new gold’ for South Africa: CEO (BusinessTech)
Big Tree Copper chief executive Jan Nelson expects a steady climb in demand for the red metal over the next three decades. This, as the world, has turned its full attention to sustainable energy and a greener economy. Recent panic over the conflict in Ukraine and its subsequent threat to Europe’s reliance on Russian energy saw a surge in the metal trade to around $10,900 per ton (R169,700). Pricing has since eased to what Nelson calls a ‘more realistic level’ but he said that over the next few decades demand should steadily increase with a long-term view of 500% growth by 2050.
Nelson said demand is expected to exceed supply with an expected upward trajectory of around 16-20% by the end of the decade. At current production rates, a deficit of at least 6 million tons is forecast, he said.
Given the metal’s history in the market, Nelson believes that the wild-card nature of copper’s pricing will continue to see short and near term fluctuations but a longer view forecasts an incremental upward trajectory.
Role confirmed for local green entrepreneurs in economic recovery, just transition (Engineering News)
There are number of opportunities for local green entrepreneurs in South Africa and they can play a pivotal role in the country’s economic recovery and just energy transition; however, it is imperative that challenges in the ecosystem be addressed and for support for participants to be bolstered. This was indicated by speakers during economic research institution Trade & Industrial Policy Strategies’ (TIPS’s) webinar, titled “Unpacking the Green Economy Ecosystem: Business Development Support Services for Local Green Entrepreneurs”, on June 1.
Zimbabwe: Mozambican Government Bans Meat Imports From Zimbabwe (allAfrica)
The Mozambican government has prohibited, as of Wednesday of the current week, the import of animals, and animal products and by-products from Zimbabwe due to the resurgence of cases of foot-and-mouth disease in that country. The measure comes after the Zimbabwean Tax Authority notified the Mozambican authorities last Friday, about the outbreak of foot-and-mouth disease in Mashonaland Central province, Mbire district, which borders Mozambique. The government has also decided to ban the import wild ungulates, and of fodder for cattle, goats, pigs and sheep. The Mozambican government is also carrying out the supervision of the movement of animals and targeted products along the main borders and other road entry points into the country.
The Economic Commission for Africa (ECA), Sub-Regional Office for Southern Africa (SRO-SA), in collaboration with the Common Market for Eastern and Southern Africa (COMESA) with Permanent Secretaries (PS) of Commerce and Industry from Zambia and Zimbabwe held a two-day high-level meeting to discuss the implementation of a common agro-industrial park (CAIP) between the two countries. The objective of the meeting was to update the two Permanent Secretaries on the progress on the implementation of the industrial cooperation programme between the two countries focusing on the common agro-industrial park; discuss the funding opportunities for activities in the park; propose a possible location of the park; review the draft harmonized policy, legal, regulatory, and institutional framework for the park and agree on a roadmap for the initiative’s subsequent phases.
Kenya’s plan to call the shots in LPG logistics (Business Daily)
Kenya seeks to dominate in the supply of Liquefied Petroleum Gas (LPG) by constructing the biggest import and storage gas facility in Mombasa and licensing more private companies to compete with Tanzania which has dominated the business for years in the region. The announcement to construct a 25,000 tonnes storage facility by the Kenya Pipeline Company (KPC) which will connect to the Sh42 billion new Kipevu Oil Terminal 2 (KOT) at the port of Mombasa comes few days after Kenya banned imports of gas from Tanzania through the Namanga border. The facility in Mombasa once completed will quicken the loading of cooking gas for distribution by trucks which will help to cut demurrage costs.
Uhuru hails direct coffee export by farmers (The Star, Kenya)
President Uhuru Kenyatta has termed the direct export of coffee by smallholder farmers as remarkable sector reform that is earning them double dividends. Speaking during the Madaraka Day celebrations in Nairobi, the head of state said his government has over the last three years eliminated the barriers created by the overly complex coffee industry structure that denied farmers their rightful share. This is the second time in less than a week Uhuru is hailing reforms in the coffee sector that have seen six coffee unions licensed by the Capital Markets Authority as brokers. Last week during the G25 African Coffee Summit, he cited a case where KipKelion District Cooperative Union earned double returns for being the first farmers-led broker to directly export coffee to South Korea.
“This is a historic achievement for small-scale coffee farmers across the country. Farmers from Kericho, Nandi and Bomet counties earned an average rate of Sh116 per kg of Cherry compared to an average of Sh76,’’ Uhuru said. He added that those market gaps must be sealed to make farming cool.
Buy your raw materials from Ghana Agric Minister tells importers of organic fertilizer (GhanaWeb)
Minister of Food and Agriculture, Dr. Owusu Afriyie Akoto is urging importers of organic fertilizers to start patronizing their raw materials from local sources. This according to him will boost efforts being made towards the production of more organic fertilizer even as imports have been distorted due to the Russia-Ukraine crisis. Farmers have in recent times, a shortage in the supply of fertilizers and the increment in their prices as well. The Agric Minister noted that government is working to support the use of organic fertilizer in the country.
Rising gold prices could offer windfall revenue (The Business & Financial Times)
The mining sector could once again be the economy’s saviour, as gold prices continue to firm up in the face of a global economic crisis.
Price of gold, which is known to gain momentum during economic crisis as investors often consider it as safe haven, averaged US$1,866 per ounce between January and April 2022 from US$1,788 per ounce within the same period in 2021, with the Ghana Chamber of Mines expecting this positive price trend to continue. This, coupled with expected higher output from large-scale gold miners according to the Chamber’s projections, means government could be in for a revenue windfall in what could be a huge boost in the face of tightening fiscal space, falling revenues from other sectors against rising expenditure.
Barriers to trade, barriers to poverty reduction? How Nigeria can harness trade to lift people out of poverty (World Bank Blog)
Nigeria’s aspiration to lift all of its people out of poverty by 2030 presents a serious challenge. Even before COVID-19, 4 in 10 Nigerians lived below the national poverty line – some 80 million people. The global pandemic, rising inflation, and ongoing uncertainty related to the war in Ukraine – combined with relentless population growth – have made Nigeria’s poverty-reduction goals more challenging than ever. Many potential poverty-reducing policies for Nigeria are considered in detail in a new report, A Better Future for All Nigerians: Nigeria Poverty Assessment 2022.
Trade presents one vital – but often untapped – pathway to poverty reduction. Through its effects on investment, technology transfer, and competition, trade can help growth – boosting job creation, increasing domestic value added, and reducing the price of goods that Nigerians buy along the way. All of these effects may contribute to reducing poverty.1
Yet trade may have different impacts on households depending where in the country they live, what jobs they do, and whether they are rich or poor : even if trade leaves people better off on average, some households could lose out.
Development Bank Ghana’s entry is timely for banks, entrepreneurs—GCB MD (BusinessGhana)
The Managing Director of GCB Bank PLC (GCB), Mr. Kofi Adomako, says the arrival of the new Development Bank Ghana (DBG) is timely for banks like GCB and also for the growth of Small and Medium-sized Enterprises (SME) in the country.
Mr. Adomako who was speaking to the collaboration between GCB and DBG, stated that “DBG is actually not going to be a commercial bank or behave like one; rather it is a wholesale bank and will typically on lend, like many other development banks, to commercial banks to intervene in markets. DBG has come at the right time in a country like Ghana. It is true we have had other banks who tried to play the role of development banks but DBG comes with a big difference. The difference DBG brings is its independence, governance and the way it was set up.” He explained that, “the development partners that DBG brings to the market are immense. I think the Bank has come at the right time and it is going to be a different bank from what we have seen in the past.
DBG is not going to compete with commercial banks but it is going to bring out the value in commercial banks in the sense that it is going to on-lend over much longer terms, in both foreign currency and Cedis which commercial banks have lacked for a long time and has stifled the growth of SMEs. So, DBG coming into the market is timely for a bank like GCB Bank. We see them as a unique partner, who will help us deepen our focus in the market and help us develop those areas in agribusiness, ICT, tourism for which much needed funding is required.”
Ethiopian Airlines convert passenger planes into cargo aircraft (CGTN Africa)
Ethiopian Airlines is accelerating efforts to convert passenger planes into freight aircraft as demand for cargo movement continues to rise. Africa’s leading airliner is keen to expand its cargo business which has surged after the pandemic-induced disruptions in supply chains.
The airline owns one of Africa’s largest and globally competitive Maintenance, Repair, and Operation divisions. So far the Ethiopian MRO, which was launched in April this year, has excelled in converting air crafts into freighters.
The Addis Ababa based aircraft wing is now converting passenger planes including this Boeing 767 aircraft into a cargo jets as it eyes a bigger slice of the cargo trade. According to Ethiopian Airlines Group CEO Mesfin Tasew, the Cargo business is expected to bring increased opportunities for the carrier which is boosting its capacity.
Morocco’s Southern Mega Projects to Boost Africa’s Trade Development (Morocco World News)
Morocco’s major infrastructure projects in its southern regions, especially the new Dakhla Atlantic port and the Tiznit-Dakhla highway, are set to contribute to the development of African trade as well as regional trade, a former Senegalese official has said.
CSOs Seek Suspension Of Taxes, Import Duties On Sanitary Pads, Petition Lawmakers (The New Dawn Liberia)
Several civil society organizations (CSOs) including Community Healthcare Initiative (CHI), Paramount Young Women Initiative (PAYOWI) and others have called on President George Manneh Weah to issue an Executive Order suspending taxes and import duties on sanitary pads. They believe that this will impact women and girls’ access to sanitary pads, making them more affordable and accessible.
A recent UNESCO study on sub-Saharan Africa showed that 1 in 10 girls misses school during their menstrual cycle, and the missed days equal 20% of a school year. “We ask the Government, through the Legislature, to amend the Revenue Code removing all taxes applicable to the importation and sale of sanitary pads in Liberia,” the CSOs’ petition noted.
Gambia, Equatorial Guinea sign accords to build diplomatic ties, trade (The Point)
The Gambia and Equatorial Guinea, Sunday, 29th May 2022 signed four bilateral agreements to establish diplomatic and trade links between the two countries, at a ceremony in the Presidential Palace in Malabo. The agreements are the Joint Communique on the establishment of diplomatic relations between The Gambia and Equatorial Guinea, Cooperation Framework Agreement between The Gambia and Equatorial Guinea, MOU on Diplomatic Consultations between the Foreign Ministries and Agreement on Reciprocal Exemption of visas for holders of diplomatic and service passports. The Cooperation Framework Agreement establishes the Joint Commission for Economic, Commerce, Scientific and Technical Cooperation.
During the ceremony, President Adama Barrow and his counterpart H. E. Teodoro Obiang Nguema Mbasogo, President of the Republic of Equatorial Guinea, affirmed the mutual benefits of establishing relations between the two countries would yield. President Barrow said the two countries could gain a lot when they work in partnership to exploit their natural resources for the benefit of their people.
World Bank Supports Economic Recovery through Resilient Tourism and Blue Economy Investments in Cabo Verde (World Bank)
The World Bank approved today an International Development Association credit in the amount of US$30 million for the five-year Resilient Tourism and Blue Economy Development in Cabo Verde Project. Complementary co-financing of US$5 million will be provided through a grant from the Global Program for the Blue Economy Multi-Donor Trust Fund. Cabo Verde’s tourism sector has seen exceptional growth in the last two decades and is a crucial driver of growth and job creation, reaching an estimated 25 percent of GDP. The Covid-19 pandemic represented a major setback with arrivals collapsing by 75 percent in 2020, affecting tourism and ancillary sectors particularly hard. In addition to the unparalleled economic shock, the pandemic also highlighted structural challenges in the tourism sector, including overconcentration of arrivals in two islands and a single market segment, weak local supply chain linkages, and environmental sustainability issues—particularly in coastal areas.
As Growth Slows, Madagascar Needs a New Reform Drive To Steer Clear of the Economic Storm (World Bank)
The latest economic update for Madagascar suggests that the economy is facing new headwinds following bouts of COVID-19 (coronavirus), a series of extreme weather events and the fallout from the conflict in Ukraine at the start of 2022. An economic recovery had started in Madagascar in 2021 but was interrupted in 2022 by a sequence of domestic and international shocks which are expected to result in growth slowing to 2.6 percent in 2022 (from 4.4 percent in 2021), with the poverty rate now expected to remain close to 81 percent. According to the Madagascar Economic Update: Navigating Through the Storm, the crisis is Ukraine is expected to affect Madagascar mainly through slowing demand from key trading partners and rising oil prices, which are projected to lead to growing fiscal pressures due to a lack of adjustment of regulated fuel prices and growing losses of the national utilities company JIRAMA. Beyond conjunctural factors, the decline in private investment and job creation since the outset of the crisis are expected to constraint in the growth potential of the economy moving forward. In this context, growth is expected to pick up to a slower than expected 4.2 percent in 2023 and 4.6 percent in 2024.
Morocco economic rebound threatened by drought, Ukraine war (RFI)
The North African kingdom had bounced back last year after a sharp recession in 2020 due to the coronavirus pandemic, and the government of gas tycoon Aziz Akhannouch had forecast growth this year topping three percent. But since Russia’s invasion of Ukraine he has been forced to slash that figure to at most 1.7 percent, telling parliament that “sudden external events and climate change” were to blame. The International Monetary Fund has forecast even lower growth of 1.1 percent. Morocco has pumped resources into diversifying its manufacturing sector, particularly by attracting auto giants such as Renault. But those efforts “have not changed the structure of the economy”. That is the conclusion of a 2021 report by a commission on the “New Model of Development” (NMD), a strategy announced last year which sets out ambitious plans including slashing Morocco’s wealth gap and doubling per capita economic output by 2035.
African trade and integration news
Transport and logistics infrastructure essential to AfCFTA implementation (The Business & Financial Times)
Industry players have acknowledged the need to prioritize transport supply chain logistics simultaneously with the implementation of the AfCFTA in order for the continent to achieve optimum benefits from the Single Continental Market agreement.
Speaking at the 2022 Charted Institute of Logistics and Transport Africa Forum in Accra, a Deputy Minister of Trade and Industry, Herbert Krapa said the AfCFTA offers the opportunity to develop intra-regional value chains that to goes beyond only exploiting and exporting raw materials from the smallest supplier to big manufacturers.
“We must develop linkages that enhance our ability and capacity to feed industry in a sustainable way if we are to reap the full benefit of our integration agenda, much of our efforts must be to ensuring that all participants are on the right side of the value chains,” he said.
Cote d’Ivoire repositions for AfCFTA with globally-fit workforce and infrastructure dev’t (The Business & Financial Times)
Francophone nation, Cote d’Ivoire, is repositioning itself for the African Continental Free Trade Area (AfCFTA) with ongoing developmental projects and strategic investments aimed at building ready and skilled workforce across the trade and logistics value chain, including the teaching of trade-related courses in English.
According to Senior Regional Procurement Officer West and Central Africa for IFAD, and Chairperson of CILT-WiLAT Cote d’Ivoire, Ms. Carine Toure Yemita, the move will position Cote d-Ivoire to take advantage of the single continental market with its competitive and globally-oriented graduates or workforce.
“Capacity building is something everyone will need but especially in Africa, we need to improve the capacity levels of our people. Based on our strategy, we’re confident that the future will be better.
African Development Bank (AFDB) Proposes Industrial Hubs To Make Africa A Manufacturing PowerHouse (Tekedia)
In a bid to make Africa a manufacturing powerhouse, the African Development Bank (AFDB) has proposed that the continental free trade agreement, CFTA, moves beyond trade to industrial manufacturing zones that create jobs for African citizens. Speaking at the AFDB annual meetings held in Accra Ghana, the President of the Bank Mr. Akinwunmi Adesina suggested that the African region should not just be a trade region, but also a region where more value-added manufacturing products are traded. In his words, “I think African Continental free trade (AFCTA) should not just be a trade region, but an industrial manufacturing zone where we trade value-added manufacturing products from national and regional value chains that are competitive globally”.
He stated that the AFCTA should drive the creation of zones that will offer infrastructures, facilities, and incentives that drive manufacturing in the continent as it is done in Asia and South America to create jobs. He further disclosed that the AFDB is working to ensure that Africa transitions to sustainable energy that can drive factories to drive manufacturing. Mr. Akinwunmi revealed that 86 percent of AFDB investments in power generation will go into renewable energy.
EAC on track to achieve single currency by 2024, says Kadaga (Monitor)
First Deputy Prime Minister and Minister for East African Community Affairs (EAC) Rebecca Kadaga has said that if everything goes according to plan, the EAC will by 2024 have a Single Currency. Speaking during the Uganda-DR Congo Business Summit in Kinshasa, Ms Kadaga said member states are now working on the finer details to choose a country to host the East African Monetary Institute that will later become the East Africa Central Bank
“By the end of this year, we should be knowing which country is hosting the monetary institute. The institute will be the East African Central Bank … We expect that if we move according to plan, by 2024, we shall have a Single Currency,” she told more than 200 delegates at the summit.
EAC tables US$91.5 Million Budget Estimates before EALA for the 2022/2023 Financial Year (EAC)
The East African Community (EAC) has tabled before the East African Legislative Assembly (EALA) the budget estimates for the 2022/2023 Financial Year totaling US$91,579,215. Presenting the speech before the Assembly, the Chairperson of the Council of Ministers and Kenya’s Cabinet Secretary for EAC and Regional Development, Hon. Betty C. Maina, said that the budget estimates for the Financial Year 2022/22023 are being presented at a time when the world’s economic recovery from the COVID-19 pandemic is under threat from the rising prices of fuel and other commodities, occasioned by the Russian - Ukrainian conflict. “Economic growth in the EAC region averaged 5.9 percent in 2021, compared to an average of 2.3 percent in 2020. The strong regional economic growth in 2021 was largely supported by increased removal of COVID-19 related restrictions, public investments and strong performance in the productive sectors,” said Hon. Maina.
“Global economic growth is expected to slow down from 6.1 percent in 2021 to 3.6 percent in 2022. Economic growth in the EAC region is projected to decline from an average of 5.9 percent in 2021 to 5.3 percent in 2022 and 5.7 percent in 2023,” she added.
The 2022/2023 Budget is themed ‘Accelerating Economic Recovery and Enhancing Productive Sectors for Improved Livelihoods.’
Post-harvest losses: EAC steps in to help farmers (Food for Mzansi)
Post-harvest losses occur in hugely concerning percentages in six East African countries where food security is under threat. To address this, an intergovernmental organisation has developed an action plan to help farmers reverse post-harvest loss. The United Nations’ Food and Agriculture Organization (FAO) estimates that an annual third of the world’s total agricultural industries deals with post-harvest loss. In the East African Community (EAC), post-harvest loss accounts for 50% in tubers and root vegetables, nearly 70% in fruits and vegetables and 30% in cereals.
According to EAC deputy secretary-general for the productive and social sector, Christophe Bazivamo, they have adopted a fruit and vegetables strategy, as well as a management action plan. This forms part of their efforts to find solutions to reducing post-harvest losses.
A detailed article published on FoodForAfrika.com explores the negative impacts of post-harvest loss and the four pillars of food security that must be realised. According to the article not only does it negatively impacts a country’s food security, but it also has a knock-on effect on levels of nutrition. The article furthermore details practical ways in which the EAC plans to reduce these losses.
Enforcing competition would ease food price hikes in east and southern Africa (The Conversation)
Small and medium-scale farmers and agri-businesses in east and southern Africa are getting a raw deal. To succeed they need fair and integrated regional markets. Research by the Centre for Competition, Regulation and Economic Development has highlighted the need for better integration of regional economies as a step towards food security in the region. Powerful commercial interests, high transport costs and poor access to facilities such as for storage mean that small and medium-scale farmers are often not getting fair prices for the food they grow. Fair prices are those that meet demand and cover reasonable costs of supply including transport across borders.
During the course of our research we came across examples of how the odds are stacked against most small and medium-scale farmers. Take the experience of Endrina Maxwell, a small producer in Malawi.
Investors assess regional railway prospects (The New Times)
Potential investors are weighing income prospects in financing the implementation of the Standard Gauge Railway (SGR) project, according to the African Development Bank (AfDB) Director General for Eastern Africa, Nnenna Lily Nwabufo. Currently, Rwanda has two route options on the table, the Kenyan Standard Gauge Railway route for the northern corridor and Isaka-Kigali Standard Gauge Railway for the central corridor.
She disclosed that investors are looking at the likely volume of services and trade attached to the railway project and whether there is enough income to be generated from that to be sure of investment viability. Nevertheless, she said that the intention is to “raise more money internally” as each involved country will have to make a commitment of the amount of money they will allocate to the project from the funding they get from the bank.
Ghana ranked 1st, 2nd in West Africa, Africa as best destination for investments, trade – Fitch Solutions (Myjoyonline)
Ghana has been ranked 1st in West Africa and 2nd in Sub Saharan Africa by Fitch Solutions, research arm of ratings agency Fitch, as the best destination for investments and trade. With a Trade and Investment Risk score of 50.9%, the country outperformed the West Africa average of 36.4%.Despite the challenges facing the economy, the country also placed 88th out of 201 markets globally in terms of competitive environment for investments and trade. For Economic Openness, Ghana scored 58% and 50% for Trade and Investment Risk. In terms of Government and Legal Intervention, the nation scored 45% each respectively. Similarly, with a Crime and Security Risk score of 51%, Ghana outperformed the West Africa average of 33.3% and ranks in 1st place regionally and in 90th place out of 201 markets globally.
The report pointed out that Ghana’s markets have strong fundamentals, including a track record of private investment in energy infrastructure, comparatively high political stability and security, and a relatively diverse competitive landscape. It however expressed worry about the depreciation of the cedi which it said will in the near term make private investors more reluctant to invest in Ghana’s infrastructure sector. It therefore do not expect private investments to meaningfully cushion the negative impact of subdued public infrastructure spending on the market’s construction industry growth.
28th Conference of Directors General of Customs of the West and Central Africa Region (WCO)
The 28th Conference of Directors General of Customs of the WCO West and Central Africa (WCA) Region was held on 26 and 27 May 2022 in Brazzaville, Republic of the Congo.
The Conference was aimed at evaluating progress with the implementation of the Region’s Strategic Plan and the recommendations made by the Directors General of Customs at their 27th Conference, which took place virtually on 30 November 2021. It was also convened to examine the reports of the WCO Secretariat, the Office of the Vice-Chair, the regional entities and the regional (IT) working group, as well as to review a draft proposal to restructure Members’ contributions to the regional fund and discuss other emerging topics.
The WCO Secretary General, in his opening remarks, thanked the authorities of the Republic of the Congo for their hospitality, before outlining the WCO Data Strategy and inviting participants to rise to the challenges of this year’s theme, namely “Scaling up Customs Digital Transformation by Embracing a Data Culture and Building a Data Ecosystem”. Later in the Conference, he delivered a keynote speech covering the items on the Agenda of the upcoming Policy Commission and Council sessions, aimed at addressing the concerns raised by Members during the regional consultations on the Strategic Plan. In this context he touched upon various topics that the Secretariat has been working on, including Green Customs and Fragile Borders.
India-Africa relations prospering on mutual respects & co-operations among others (NewsOnAIR)
Dating back several centuries, the relations between India and African countries are driven and shaped by a number of factors, including trade and investments, cultural, historical and political engagements.
India and Africa’s historical links and relations have experienced a revival in recent years and both sides understand the fact that it is a win-win situation as growing relations are mutually beneficial. India-Africa trade has grown to around 66.7 billion US dollar in 2019-20. Around 8% of Indian imports are from Africa and around 9% of Africa’s imports are from India. The investment of India’s public and private sector enterprises are increasing in Africa, making it the 8th largest investor in African.
In recent years, besides loan and investment, India has also given ample amount of aid to Africa to fight the Covid-19 pandemic. Under the Vaccine Maitri initiative, India supplied 24.7 million doses of Made of India Covid vaccines to 42 countries in Africa.
Clearly, India looks to engage with Africa meaningfully, focusing much on its core competencies like human resource development, training and skill development, IT, ITES, education and healthcare services unlike China who focuses majorly on developing manufacturing capacities and infrastructure in Africa. While, China’s economic model of engagement with Africa looks attractive and has also paid rich dividend in recent years, the fascination for India’s support for democratic practices, processes, institutions and people to people engagement is high in Africa.
Global economy news
Closed-down ports, held-up containers, and waiting ships in Odesa, Shanghai, or Los Angeles have an impact on supply chains and consumer prices around the world. As shipping markets are global, it is above all the smaller and more vulnerable economies that are more negatively affected by capacity shortages and freight rate increases.
As maritime transport freight rates go up, consumer prices will increase as well. Although it is often said that the shipping costs make up only a small proportion of the final price of high street shop prices, the historically high freight rates – especially for containerised shipping – do trickle down and lead to higher inflation.
Already in our UNCTAD Review of Maritime Transport 2021, we had simulated that the high freight costs will be passed on and lead to an additional increase in consumer prices by 1.5 percentage points globally, with Small Island Developing States and Least Developed Countries experiencing significantly higher surges. Latest data by the IMF confirms that our earlier simulation was spot on.
An update of this assessment for an upcoming UNCTAD expert meeting show that the situation is not improving: As inflation has now reached us all, the contribution of container shipping costs to the price increases is rising. Globally, consumer prices are expected to go up by 1.6 percentage points; in Least Developed Countries the simulated increase is 2.4 percentage points, and in Small Island Developing States it reaches plus 8.1 percentage points.
IMF says it’s looking at ways to channel SDRs to development bank (BusinessLIVE)
The African Development Bank (AfDB) is lobbying rich nations to use their rights to International Monetary Fund (IMF) reserve assets to help it raise funding to support poorer countries, the first such initiative undertaken by a multilateral lender. “We’re pioneering for Africa but also pioneering for multilateral development banks,” which can complement and magnify the work of the IMF, AfDB CFO Hassatou Diop N’Sele said in an interview. The IMF injected a record $650bn into the global fiscal system in 2021 to mitigate the impact of the coronavirus by releasing special drawing rights (SDRs) to its member states.
The AU has called for an additional $67bn to support the continent, with part of it channelled through its regional lender. Under an AfDB proposal, wealthy nations would lend their SDRs to the Abidjan-based bank, which could account for these assets as equity and leverage them to raise three to four times as much funding to support African economies.
Western sanctions policy mindless: Russian official (The Herald)
THE chairperson of the Federation Council of the Federal Assembly of the Russian Federation, Ms Valentina Ivanovna Matvienko, who arrives in the country today for a three-day official visit, has described the Western sanctions policy as mindless. Ms Matvienko is set to have high-level meetings and engagements with President Mnangagwa and other heads of national institutions on how Russia and Zimbabwe can elevate their strategic co-operation in the face of Western sanctions. Both Russia and Zimbabwe have been targeted by Western countries through sanctions for their preference of a fairer world where sovereign countries can determine their destinies within the confines of international law.
Speaking to The Herald prior to her visit, Ms Matvienko emphasised that “developing relations with African countries is one of Russia’s foreign policy priorities”.
Confronting a perfect long storm (IMF Blog)
The pandemic, war in Ukraine, the threat to food security, and the resurgence of global poverty. Heatwaves, droughts, and other extreme weather events. These are not random shocks. Nor are they a perfect storm in the conventional sense, a one-off conjuncture of bad events. We face instead a confluence of lasting structural insecurities—geopolitical, economic, and existential—each reinforcing the other. We have entered a perfect long storm.
There is no lack of private and market finance. But channeling it to meet the needs of the commons requires a proactive public sector and well-designed frameworks for risk-sharing with the private sector. Policies and standards to rapidly scale up the deployment of clean energy technologies that are already proven, and to incentivize large scale infrastructural investments such as in smart transmission and distribution grids, will be critical to achieving significant cuts in emissions by 2030. However, almost half the technologies needed to reach net zero by mid-century are still being prototyped. Governments must put skin in the game to leverage private sector R&D, and promote demonstration projects, to accelerate the development of these technologies and bring them to market. Besides getting to net zero on time, they should aim to spur major new industries and job opportunities.
A more fragmented world (IMF Blog)
The rare confluence of geopolitical, economic, and technological forces now confronting the world may reverberate for generations.
The war in Ukraine is thrusting us into a fraught period of geopolitical realignment, supply disruptions, food and energy insecurity, and more volatile financial markets. These shocks could shake social and political stability in some countries while weakening the ability of the world as a whole to confront its foremost long-term challenge, climate change. A more fragmented world, says Singapore’s Tharman Shanmugaratnam, makes greater investment in global public goods even more urgent—an effort he argues will require unprecedented public-private collaboration and a stronger, more effective multilateralism.
New report highlights positive impact of WTO technical assistance activities (WTO)
This document shows the swift reaction of the WTO Secretariat to the COVID-19 pandemic, WTO Deputy Director-General, Xiangchen Zhang, said in the foreword to the report. He stressed that, with innovation and flexibility, the WTO Secretariat was able to continue providing support to developing countries and least-developed countries despite the constraints posed by the pandemic, such as travel restrictions.
