tralac Daily News
The South African government has described new requirements for the export of citrus, mainly oranges, from South Africa to the European Union as “trade restrictive” and “unjustified”. In a statement on Monday, the Department of Agriculture, Land Reform and Rural Development said the South African government continued to engage with the European Commission (EC) on the new requirements.
TRANSPORTERS of commercial cargo continue to experience long delays at the Beitbridge Border Post, as the South African Revenue Services (SARS) customs officials continue with their protest over pay increase. The revenue and customs officers are demanding a pay rise of 12 percent and their employer has offered to review the salaries by only 1,7 percent, a move that has resulted in a stalemate.
“We would like to assure traders and travellers that we have put various contingency measures in place at land border posts to ensure minimal disruption during the current industrial action at SARS,” said the revenue collector. “SARS will ensure that the following capabilities remain available throughout the duration of the industrial action: the processing of declarations will continue as normal; physical inspections of goods will continue as normal, with inspection finalisation being centralised and managed on a 24-hour basis. “In addition to that, trade has been engaged about temporary measures instituted in relation to the authorisation and management of SADC certificates of origin for cargo transported across land borders.”
Concern over move to coal (SAnews)
Minister of Forestry, Fisheries and the Environment Barbara Creecy has expressed concern at some developed countries who were reverting to coal in response to their negative national circumstances. This as the Glasgow Climate Pact called upon nations to phase down unabated coal power and inefficient subsidies for fossil fuels. “We cannot have backtracking by developed country Parties. Developed countries must continue taking the lead with ambitious action. The ultimate measure of climate leadership is not what countries do in times of comfort and convenience, but what they do in times of challenge and controversy,” the Minister said on Monday.
Horticulture cash crop farming on the rise in Zim (The Herald)
Zimbabwe’s horticultural sector is fast emerging as a major driving force for the development of agricultural sectors in the country. Several indicators are already casting a shining light on this sector. Horticulture exports in 2021 grew by 6,8 percent to US$64,6 million from US$59,5 million recorded in 2020, according to the trade promotion body, ZimTrade. With the right support and investments they are rising to the occasion, stimulating export growth through increased production and exploiting opportunities coming with growing global demand.
State relaxes deadline for yellow maize imports (Business Daily)
Animal feed manufacturers have got a reprieve after the Ministry of Agriculture announced it will allow shipments of processors whose consignment of yellow maize imports will arrive in the country past the initial set deadline of October. The imports are aimed at taming the high cost of animal feed. Livestock Principal Secretary Harry Kimtai said those who would have made orders for yellow maize within the set timeline will not be barred from offloading the produce duty-free even if it docks at the port way past the deadline. The manufacturers had last week said that they would not import the produce because of the shorter opening that is remaining between now and the end of October when the duty-free window lapses.
Sanctions block Sh13bn Russia exports to Kenya (Business Daily)
The Russia-Ukraine conflict knocked off Sh13.3 billion in imports from Moscow in the three months to March, forcing Kenya to turn to expensive sources of wheat, fertiliser and steel that helped drive inflation to a 58-month high. Latest data from the Kenya National Bureau of Statistics (KNBS) shows that the sharpest decline happened in the three months to March, as troops from Moscow marched into Ukraine, with imports from Russia dropping 66 percent from Sh19.9 billion to Sh6.6 billion. European nations and the US have imposed sanctions against Russia in the wake of its invasion of Ukraine in February, restricting the flow of its exports. They have sanctioned more than 1,000 Russian individuals and businesses and restricted the purchase of Russian oil.
Kenyan exports to Russia dropped marginally by three percent to Sh2.8 billion during the conflict period, as traders sought alternative routes to ship goods into the country at a time when the international community was announcing sanctions. “The issues on logistics are due to shipping challenges, wheat not leaving the country (Ukraine) and security around the war zone region imposing high risk even for delivery of our exports,” said Julius Opio, the Kenya National Chamber of Commerce and Industry (KNCCI), Nairobi County chairman.
Uganda government officials have been racking up air miles between Entebbe, Italy and US to strike a financing deal for the $4 billion refinery project. Government officials admit that the refinery project has fallen behind others, and will likely come onstream late in 2027 at the earliest if the necessary financing is tied up and the pending technical studies concluded sooner. As a result, local players that were primed to take up equity in the project as well as regional countries that expressed interest in the refinery that was sold as an East African Community (EAC) venture, remain non-committal, citing the project’s failure to take shape since 2018, when it was awarded to a consortium of investors.
Kenya-US go for fresh trade pact as Biden dumps Trump’s deal (The Star, Kenya)
Kenya and US will commence working within three months to develop a detailed roadmap for engagement as they seek what they term a “ Strategic Trade and Investment Partnership.” This signals an end to an initial push for a Free Trade Area (FTA) agreement, whose talks commenced two years ago.
On Thursday, CS Maina and Tai announced the launch of the Kenya-United States Strategic Trade and Investment Partnership (STIP).This was after a virtual meeting between the two, building on their June 13 meeting in Geneva. The two agreed that their governments will pursue enhanced engagement leading to high standard commitments in a wide range of areas with a view to increasing investment, promoting sustainable and inclusive economic growth, benefiting workers, consumers, and businesses.
In a statement to newsrooms, Kenya’s trade ministry said the two have identified issues where the country and the US will develop “an ambitious roadmap” for enhanced cooperation, with the goal of negotiating high-standard commitments in order to achieve economically meaningful outcomes.
The United Nations-Under-Secretary-General (USG) and Economic Commission for Africa Executive Secretary(ES) ended a successful four-day visit to Zambia and met with the President of the Republic of Zambia, Minister of Finance and National Planning, Governor of the Bank of Zambia and delivered a public lecture to students and academics at the margins of the African Union 41st Ordinary Session of Executive Council and 4th Mid-Year Coordination Meeting that took place from 14th to 17th July 2022 in Lusaka.
The meeting organized under the theme, “Building Resilience in Nutrition and Food Security across the African Continent,” brought together thirteen Heads of State and Government, comprising five Heads of State that form the current Bureau of the Assembly of the African Union (AU), and eight Heads of State who Chair the Regional Economic Communities that are recognized by the AU. The Summit closed with concrete decisions presented by the AU Chairperson, the Senegalese President Macky Sall, who said Africa needs pharmaceutical sovereignty, access to commercial platforms for trade and regional integration to accelerate social and economic development. The USG assured member States of the Economic Commission for Africa (ECA)’s continued support and advocacy for debt sustainability in Africa and for a fair and equitable global financial architecture.
Trade exchange between Egypt and Tanzania amounted to $51.4 million in 2021, rising by 36.3% from $37.7 million in 2020, according to a recent official statement, citing Head of the Egyptian Commercial Service (ECS) Yahya El-Wathik Bellah. Egyptian exports to Tanzania notably grew last year to $47.9 million, compared to around $34.7 million in 2020, El-Wathik Bellah highlighted. Meanwhile, Egypt’
Kenya has decided to continue exempting Egyptian exports from customs duties for a year, starting from July 1st 2022 until the end of June 2023, according to a recent statement by the Egyptian Ministry of Trade and Industry. This decision comes after Kenya obtained the approval of the East African Community’s (EAC) Customs Union to extend the exemption of customs duties on imports from Egypt and the Common Market for Eastern and Southern Africa (COMESA) for an additional year. Egypt has been ranked first among the top 28 exporters to Kenya in 2021, acquiring more than 70% of the Kenyan market as compared to its peers.
In 2021, trade exchange between Egypt and Kenya increased by 4.7% to $666 million, versus $635.8 million in 2020, Head of the Egyptian Commercial Service (ECS) Yahya El-Wathik Bellah said.
The only way for Africa to be freed from the shackles of debt and get its development back on track is if the continent is assisted by developed countries, private financial institutions and international multilateral financial institutions. This was this submission from an international online seminar with the theme, “Africa’s Debt Situation and China’s Responses,” organised by the Shanghai Institute of International Studies (SIIS). The seminar held at the weekend had in attendance experts and professionals from international organisations, enterprises, Chinese and foreign think tanks and representatives from universities, where they discussed two major topics: ‘Assessing the debt situation in Africa, and China’s role in the African debt issue.’
The seminar aimed to deepen the understanding of African debt crisis and explore how China and the African community could deepen their cooperation with Africa. At the same time, the seminar called on all parties to coordinate and cooperate on this problem, especially the developed countries, private financial institutions and international multilateral financial institutions, and together they should take stronger actions in providing financial support to developing countries and alleviating their debt through actions by all parties can the world help Africa and the global economy to achieve inclusive and sustainable development.
The United Nations Economic Commission for Africa (ECA)’s AfCFTA-anchored Pharmaceutical Initiative held a virtual side event on the margins of the High-Level Political Forum on Sustainable Development: Showcasing the AfCFTA-anchored Pharmaceutical Initiative: lessons and experiences on July 6 2022.
Hon. Sidibe in his opening remarks said that the Continent’s “dependence on externally manufactured goods was problematic as access to COVID 19 vaccines starkly reminded Africans. He said that the local manufacture of pharmaceuticals on the continent, was therefore no longer an option. “The continent only produces 3% of the medicines consumed by its people. Pharmaceutical supply chains have multiple intermediaries.” He said that these intermediaries contributed to drugs being sold in Africa being the most expensive in the world and that it is very important, in addition to note that Africa has the highest prevalence of sub-standard and counterfeit medicines, with some countries are reaching as much as 30%. Hon. Sidibe said, “these challenges have been largely attributed to weak or absent drug regulatory systems, unclear policies and incomplete or inconsistent legal and regulatory frameworks in many cases. So, acting at this level is therefore critically important.”
The Board of Directors of the African Development Fund approved an $11.02 million support package to the Permanent Secretariat of the African Continental Free Trade Area (AfCFTA) to help it enhance effective implementation.
The world’s second-largest free trade area has a potential market of 1.2 billion consumers, but Africa has the world’s lowest level of intraregional trade at less than 18%, compared with 22%, 50% and 70% for Latin America, Asia, and Europe respectively. The AfCTFA aims to increase this by up to $35 billion per year (25%) over a decade, lower annual imports by $10 billion, and boost agriculture and industrial exports by up to $45 billion (7%) and $21 billion (5%) respectively.
This second phase of support continues to aim to encourage sustainable intra-African trade and to increase the share of African countries participating in it. It is also intended to move the African trade integration agenda forward by enabling the secretariat and the countries of the zone – especially transition countries – to harmonize and integrate national and regional trade policy initiatives.
Lack of product diversity leaves East Africa exposed (The East African)
East African countries are among the 45 nations in the continent that still depend heavily on the export of primary commodities such as minerals, ores, fuels, metals, agricultural produce and foods, a phenomenon which increases their vulnerability to economic shocks and slows growth. This is why the UN Conference on Trade and Development (UNCTAD) is urging them and other African countries to implement various policy recommendations that will see them diversify their exports by boosting the services sector. The UN agency’s new report, released July 14, suggests that the commodity-dependent African countries could become more resilient to external economic shocks if they diversified their exports, especially through expanding their service exports. “Dependence on commodity exports has left African economies vulnerable to global shocks and hindered inclusive development for far too long,” said Rebeca Grynspan, UNCTAD Secretary-General.
Dr. Merian Sebunya, Chairperson, National Logistics Platform, Uganda said “Transport and logistic costs compose of 35%-42% of production this is high compared to 8% in Asian countries. “ She explained that this has negatively impacted the competitiveness of the EAC bloc and trade balance. EAC transport costs are high estimated at 1.8USD per km per container against international best practices of 1 USD per km per container.
The EAC Trade & Investment Report (2020) shows EAC exports globally stood at USD US16.2 billion in 2020 while imports at USD 35.6 billion registering a negative balance of trade of USD 19.4 billion.
CROSS border traders have urged regional governments to decentralise trade document issuance and clearance by creating one-stop-centre models for harmonised services and enhancing ease of doing business. This emerged during a stakeholder training meeting organised jointly by the Common Market for Eastern and Southern Africa (Comesa) and the International Organisation for Migration (IOM) in Bulawayo last week. In an interview on the sidelines of the meeting, Comesa consultant and advisor on migration, Mr Brian Chigawa, said the workshop highlighted the challenges facing cross border traders and sought to help address them.
He said cross border traders were also encouraged to use safe and proper channels of doing business, which is possible when they get required documents and licences.
Northern Corridor ministers eye wider use of rail and waterways (The East African)
The Northern Corridor Council of Ministers has approved $5.53 million budget for the 2022/ 2023 financial year, with an eye on roads, rail and waterways projects as solutions to congestion. The Executive Committee approved $1.1 million more than it did in the past fiscal year for railway and inland water projects expenditure. The meeting made the decision even as Kenya and Uganda remain at odds over the completion of the oil jetty in Lake Victoria on the Ugandan side. Kenya, Tanzania and Uganda had earlier agreed on using Lake Victoria as a key transit point for oil.
“There is a need for an increased inter-connectedness of the different transport modes along the corridor, especially with the increased pace of development of railway and road infrastructure and the upgrading of lake ports,” reads a joint communique by the six member states.
Africa’s risk of debt piles as countries fight inflation (The East African)
African governments owe three times as much debt to private creditors in the West as they do to China, a report by UK-based Debt Justice released this week shows. Using World Bank and International Monetary Fund (IMF) data, Debt Justice estimates that 35 percent of the continent’s external debt is owed to banks, asset managers and oil traders in the West, with Chinese lenders accounting for around 12 percent. Of the $444 billion in debt repayments that African governments will cough up between 2022 and 2028, $156 billion or 35 percent will go to these private creditors compared with $83 billion due to China.
Since the launch in November 2020 of the G20’s Common Framework, three countries – Ethiopia, Zambia and Chad –have applied for support under the programme aimed at providing debt restructuring as an answer to unsustainable debt levels. So far, none has received any debt relief.
The IMF has called for the initiative to be stepped up, warning that countries could face “economic collapse” if global action on debt relief falls short.
Now, Ethiopian authorities have approached their creditors to speed up relief decisions to help the country balance its budgetary needs in the wake of various crises. The move made this week reflects the situation in several African countries that may see their efforts at rebuilding post-Covid-19 drowned in mounting debt or weakening currencies.
Joint Statement by the Heads of the Food and Agriculture Organization, International Monetary Fund, World Bank Group, World Food Programme, and World Trade Organization on the Global Food Security Crisis
The COVID-19 pandemic, interruption in international supply chains, and the war in Ukraine have severely disrupted food, fuel, and fertilizer markets, which are interlinked. By June 2022 the number of acute food insecure people – whose access to food in the short term has been restricted to the point that their lives and livelihoods are at risk – increased to 345 million in 82 countries according to WFP. Making matters worse, around 25 countries have reacted to higher food prices by adopting export restrictions affecting over 8 percent of global food trade.
Avoiding further setbacks to achieving the Sustainable Development Goals requires short and long-term actions in four key areas: (i) providing immediate support to the vulnerable, (ii) facilitating trade and international supply of food, (iii) boosting production and (iv) investing in climate-resilient agriculture.
In her virtual intervention at a session on strengthening global collaboration for tackling food insecurity, the Director-General told the gathered ministers and central bank governors that WTO members “took some important steps” at their 12th Ministerial Conference (MC12) in June. These included a decision to exempt from export restrictions food bought by the World Food Programme (WFP) for humanitarian purposes and a declaration to facilitate trade in food, fertilizer and other agricultural inputs.
“Ministers also adopted a Declaration pledging to facilitate trade in food, fertilizer and other agricultural inputs,” the DG added. “They stressed the importance of not imposing export restrictions and encouraged members with surplus stocks to release them on international markets.”
The Group of 20 major economies’ finance chiefs on Saturday pledged to address global food insecurity and rising debt, but made few policy breakthroughs amid divisions over Russia’s war in Ukraine at a two-day meeting in Indonesia. With questions growing about the effectiveness of the G20 in tackling the world’s major problems, U.S. Treasury Secretary Janet Yellen said the differences had prevented the finance ministers and central bankers from issuing a formal communique but that the group had “strong consensus” on the need to address a worsening food security crisis.
The G20 will set up a joint forum between finance and agriculture ministers to address food and fertilize supply issue. A similar forum has been set up for finance and health ministers for pandemic preparedness. G20 members pulled together at the start of the pandemic, but initiatives to cushion the shock for heavily indebted poor countries failed to produce significant results.
Kristalina Georgieva, head of the International Monetary Fund, warned more than 30% of emerging and developing countries - and a staggering 60% of low-income countries - were in or near debt distress. read more “The debt situation is deteriorating fast and a well-functioning mechanism for debt resolution should be in place,” she said.
G20 Finance Ministers and Central Bank Governors Converge to More Concrete Actions amid Increasing Global Challenges (G20 Presidency of Indonesia)
Russians to hold trade talks in South Africa (The Mail & Guardian)
While their compatriots back home are engaged in mortal combat with Russians, Ukrainians in South Africa will have to settle for keeping a beady eye on their enemies when a Russian delegation arrives in Johannesburg next week on a two-day business mission. The Russian Export Centre (REC) group, which describes itself as a state-owned development institute for non-energy sector exports, is hosting the meeting on Wednesday and Thursday at the Sandton Holiday Inn. According to the invitation, REC expects to bring in representatives from 10 sizeable Russian companies as part of its bid to offer financial and non-financial support to the foreign partners of Russian exporters. The focus will be on “engineering and agricultural mechanisation”.
Members suggested that the Group should be looking into issues related to digitalization of trade processes, the treatment of low-value shipments and the impact of cyber-security on small business and enhancing engagement with the private sector to receive relevant feedback to the work of the Group.
Ambassador Mina of Australia, who chaired the meeting, highlighted the statement issued at the 12th Ministerial Conference (MC12) by ministers of Australia, Japan and Singapore. This statement included a commitment to revise the working modalities of the initiative to ensure that it achieves progress in the next few months and to issue a new consolidated negotiating text by the end of 2022. Ambassador Mina said: “We are marking this new phase with a step-up of our convergence efforts that’s going to require a couple of different ways of working.” He said that participants will need to accelerate their work in the small group setting.