tralac Daily News
The South African government has managed to negotiate a settlement that will see the clearing of citrus containers stuck in ports of entry in the European Union (EU). The settlement follows new measures introduced by the EU to regulate risk associated with False Codling Moth (FCM) on citrus fruit. The new measures include amended additional phytosanitary declarations for grapefruit and soft citrus, and a revised cold treatment regime for oranges.
The new EU rules for citrus imports from South Africa: Background, applicable legal texts and processes, and the dispute declared by South Africa under the rules of the World Trade Organisation (WTO) (tralac)
South Africa is in need of changes to its industrial policies (Mail & Guardian)
After 28 years of democracy, South Africa has failed to achieve structural transformation of the economy. The government must stop paying lip service to industrial policies and implement aggressive measures to transform the economy and steer production towards sectors that have high employment multipliers. Such policies can significantly increase the pace of job creation.
Industry organisation the Metal Recyclers’ Association of South Africa (MRA) says the six-month ban on the export of metal proposed by the Department of Trade, Industry and Competition (DTIC), would detrimentally affect the price of all South African scrap metal, and, in turn, negatively impact the recycling sector and all sources of scrap generation, including manufacturing, construction and mining, as well as the informal sector. The DTIC on August 6 published draft proposals for a six-month export prohibition on scrap and waste metal, including copper cable, together with a permit system for the export of specified semi-processed metal products to address widespread theft of copper cable and other forms of metal from public infrastructure and issued a call for public comment on the proposed policies.
Manufacturing output down 3.5% y/y in June (Engineering News)
Manufacturing production in South Africa decreased by 3.5% year-on-year in June, primarily brought down by the motor vehicles, parts and accessories, and other transport equipment sector, which declined by 17% and subtracted 1.8 percentage points from the overall tally. The food and beverages sector’s 3.8% decline contributed to 0.8 of a percentage point being shaved off the overall figure, while a 2.9% decline in the manufacturing of basic iron and steel, nonferrous metal products, metal products and machinery took 0.6 of a percentage point off overall.
Zim a key market, says Nedbank Group (The Herald)
The Nedbank Group, says it continues to see Zimbabwe as a key market despite currently obtaining challenges that include resurgent inflation and operating cost pressures. The South African financial services group has a presence in the country’s financial industry through Nedbank Zimbabwe. The bank also has a footprint in other regional markets. Dr Terence Sibiya, the managing executive of Nedbank Africa Regions, during an online media briefing, said the short to medium and long-term outlook for Zimbabwe remained robust.
He said that there were various sectors of the economy that present opportunities such as infrastructure, energy, agro-processing, tobacco processing and mining. “For the long term, we believe these sectors will contribute significantly to overall recovery of the Zimbabwean economy and we would want to play a key role in that,” he said.
Kenya: Cost of flour set to shoot up as subsidy ends next week (Business Daily)
Consumers are staring at expensive flour as the subsidy programme is expected to come to an end next week. The government, in an agreement with millers, had in July agreed that the subsidy programme was to end after a month. This is despite President Uhuru Kenyatta’s announcement that the programme would continue indefinitely. The subsidy programme was started to ease the price of flour that had shot to a historic high of Sh210 on the back of a shortage of maize. The prices have so far dropped to Sh100 but the flour is hardly found in shops.
“The programme was to run for a month from the contract that we had with the government. It is coming to an end next week,” said Rajan Shah, chief executive of Capwell Industries.
Millers are also grappling with slow payment from the government even as it emerged that only Sh4 billion had been set aside for subsidy despite the Ministry of Agriculture’s announcement that Sh8 billion had been allocated for the programme.
French firms step up quest for big trade deals in Kenya (Business Daily)
French companies scouting for investment opportunities in Africa have tended to look towards the west of the continent, owing to historical ties that have similarly seen their British counterparts frequent the East African region. The European Union’s second-largest economy is, however, making a concerted effort to deepen its presence in East Africa, signified by France President Emmanuel Macron’s state visit to Kenya in March 2019 — the first ever by a French leader to Nairobi. Major French multinationals have long operated in Kenya and East Africa, particularly in the manufacturing and energy sectors.
Mourad Choiuqa, Bpifrance regional manager for Eastern, Southern Africa and the Indian Ocean, told the Business Daily that since 2015, the agency has been financing deals between French and foreign companies, from one million euros for private firms to five million for public sector players. “It’s a financial bridge that we are trying to bridge between French and foreign companies to strengthen partnerships between France and Africa. For the moment this is something that we do a lot in West Africa because of historical reasons because that’s where you find more French companies partnering with local firms,” he said.
Trade minister accused of unfair policies on rice importation (Parliament of the Republic of Uganda)
Parliament has directed the Minister of State for Trade, Hon. Harriet Ntabazi, to withdraw her directive on what they termed, ‘unfair trade policy on rice importation’. On 21 April 2022, Ntabazi issued a directive to the Commissioner, Customs Uganda Revenue Authority (URA) where she directed the Authority to stop clearing Value Added Tax (VAT) exempted rice imports at the borders. This directive prompted rice traders, specifically the Kampala Rice Traders Association to petition Parliament to intervene, claiming this directive was unfair and repugnant.
In their petition, rice traders also decried Ntabazi’s directive to install the Rice Agribusiness Development Foundation (RADFO) as an apex body with autonomous powers to import rice, which the traders said was fleecing them and frustrating trade. The matter was subsequently referred to the Parliamentary Committee on Tourism, Trade and Industry for investigation.
While presenting the committee report during the plenary sitting on Wednesday, 10 August 2022, the committee chairperson, Hon. Mwine Mpaka said that Ntabazi exceeded her powers and issued orders that have distorted trade order in the rice trade. “The minister irregularly and without lawful authority instituted RADFO as the apex body in the rice sub sector without involving the rice traders and associations. The actions of the minister are disruptive and do not encourage trade order in the rice trade,” Hon Mpaka said. The committee also noted that Ntabazi acted unfairly when she issued directives to URA to stop rice imports without giving rice traders a fair hearing.
Uganda: Proposed local content law ‘could break trade agreements’ (Supply Management)
Uganda’s government has warned MPs not to pass a private member’s bill that aims to prioritise local firms wherever possible in procurement, saying it could break trade agreements. Amos Lugoloobi, finance minister in charge of planning, asked lawmakers to closely scrutinise the local content bill, saying around 90% of its contents relate to procurement. Lugoloobi believes the bill as it stands is not likely to guarantee Ugandan firms are prioritised during public procurement and could risk sparking disputes with trading partners. The bill would force contractors using public money or Uganda’s natural resources to acquire a licence and prioritise local suppliers.
But according to Lugoloobi, the bill is not comprehensive enough to cover issues of local content and contradicts the East African Community Protocol on free movement of goods and services. “The protocol is about free movement of goods and services and you cannot legislate against it,” he told a finance committee. He urged consultations with the minister for East African community affairs instead.
US Think Tank: Morocco Positions Itself As Africa’s ‘Business Hub’ (Morocco World News)
Given its gigantic infrastructure projects and well-defined strategy, Morocco is positioning itself as a “business hub” in Africa, according to a recent article by the Global Policy Institute, a Washington-based US think tank.
“Morocco enjoys political stability, a geographically strategic location, and robust infrastructure, which have contributed to its emergence as a regional manufacturing and export base for international companies,” the article noted.
Titled “Morocco’s Road to Development,” the think tank’s report highlighted Morocco’s commitment to further improve the business climate and attract more foreign direct investment, while reinforcing its investment strategy in sub-Saharan African countries.
The AfCFTA Country Business Index: Understanding private sector involvement in the AfCFTA (Brookings Institution)
The narrative around a successful African Continental Free Trade Area (AfCFTA)—its potential to increase intra-African trade by 15 to 25 percent, or $50 billion to $70 billion—is promising, but if African businesses do not efficiently utilize this landmark agreement, its ultimate success will be limited. Since the private sector is directly involved in cross-border trade, it is a major stakeholder and beneficiary of the AfCFTA.
Thus, to better understand how African businesses are approaching the AfCFTA and, more importantly, how the AfCFTA can best support those businesses through trade, the United Nations Economic Commission for Africa (ECA) created the AfCFTA Country Business Index (ACBI).
The ACBI is a new AfCFTA-focused, ease-of-doing business index and is based on a robust theoretical framework and data collection process. It enables relevant policymakers to identify bottlenecks in intra-African trade at a country level, which informs the barriers impeding effective AfCFTA implementation from the perspective of the private sector. It aims to inform African policymakers on the trade barriers and guide AfCFTA national strategies. The ACBI aims to ensure that the African Continental Free Trade Area delivers on its projected sustainable development promises, especially for women-owned and small- and medium-sized businesses (SMEs).
AfCFTA launches digital hub to ease trade on the continent (Capital Business)
The African Continental Free Trade Area (AfCFTA) Secretariat has launched a digital platform aimed at easing trade on the African continent. The platform dubbed – The AfCFTA Hub – is an interconnect clearing house for national government, intergovernmental, private, and public digital and partnership platforms to link together all businesses to drive the success of the free trade area. The hub is designed to grow into a single, trusted directory of the services needed to navigate the AfCFTA for small players, thereby making the AfCFTA the most inclusive Free Trade Area in the world.
Kenya is one of the seven countries that have been selected to start trading under the AfCFTA framework in a pilot phase to test the environmental, legal and trade policy basis for intra-African trade. Following the selection, the country recently launched its National AfCFTA implementation strategy to fast track implementation of the AfCFTA. The Strategy identifies priority export products and sectors for goods and services aligned with Kenya’s national development goals and aspirations, including the Integrated National Export Development and Promotion Strategy (INEDPS) and the Big Four Agenda.
The UN Eminent Peace Ambassador to Ghana, Dr Samuel Ben Owusu has stated that it will take four key factors, Homework, hard work, network and smart work to run a successful business in the country.He made the assertions at the Mantse Amugi Business Africa 2022 Conference which was held at the Accra Metropolitan Assembly (AMA) on the 9th to 10th of August 2022.The Conference and Exhibition dubbed, “Realizing the AfCFTA Benefits and More” was organised under the auspices of the Ga Traditional Council in Partnership with the Office of the Ga Mantse and JLA Group International.
“Do as much homework as possible. Deeply understanding the potential customer’s pains and desires allows a founder to iterate the product and vision to quickly find product/market fit. Really knowing the market allows a team to be flexible in their plans and to identify and analyse new opportunities as they arise. It also strengthens your confidence, your self-esteem and integrity in your industry.”He also said,” You must align yourself with a certain character and attitude to effectuate your homework studies, you must have the attitude of quick response, responding to inquiries and the market demands will keep you ahead if the market obedience to the fluctuation of the market and being obedient to your task.”
Agro-processors urged to tap into continental trade platform (The New Times)
“Over 4,000 local cooperatives are in agricultural business, small firm industries are agro-processing based, it shows how agriculture plays a major impact in trade and if we upsurge on the agro- processing industries, the county will be able to tap all the prospects in free trade area, but only if we have competitive products on the market”, he said The Minister of Trade and Industry, Jean-Chrysostome Ngabitsinze has urged local agro-process manufactures to tap into opportunities offered under the African Continental Free Trade Area (AfCFTA).
It was revealed at the workshop on Critical Analysis on the Biennial Review Process held recently in Yaounde, Cameroon that failure and hesitation in adopting the pledge to align by the Malabo declaration is accelerating the current food security crisis across the continent.
Speaking on reasons behind the declaration implementation failure in most of the continent’s states, Minister of Agriculture and Rural Development Republic of Cameroon Mbairobe Gabriel said African countries should domesticate the 2014 Malabo commitments if the continent is to benefit from its agricultural potential and develop holistically.
We know that our countries committed to the comprehensive Africa Agriculture Development Programme (CAADP)during Malabo, however, many of us have not domesticated the commitments,” he said.
According to him, the recent biennial review indicates that African countries need to do more as a continent to get the African agriculture system where it is supposed to be. He urged Africans to quickly rethink and act accordingly.
President Museveni has pledged to support Somalia in its bid to join the East African Community (EAC) and exploit trade opportunities that exist in the region. Mr Museveni said Somalia has all qualifications to join EAC, which include; sharing a border with one of the member countries, having a private sector-led economy and being a democratic country. He was speaking during the closing ceremony of a two-day inaugural Uganda-Somalia business and investment summit held in Kampala yesterday.
ECA currently comprises Uganda, Kenya, Tanzania, Rwanda, Burundi, South Sudan and DR Congo. Mr Abdirashid Duale , the chief executive officer of Dahabshiil, a money transfer company, said the summit does not only present opportunities but also helps the business community understand the challenges that people in the region face.
The Final Report of the SMART (Sustainable Market Access for African Road Transport) study is aimed at analysing the main regulatory and non-physical barriers that impede a streamlined movement of vehicles and goods within and between the different Regional Economic Communities (RECs) in Africa, and at providing recommendations in order to increase efficiency of cross-border road transport, reduce its costs, and maximize the economic benefits of the transport infrastructure, in view of reducing the cost of trad-ing across borders.
15 Sub-Saharan African countries that earn the highest forex through exports of products and services (Business Insider Africa)
For most developing countries in Africa, foreign trade is imperative. For one, these countries need to import the many products and services they can’t produce. Also, exporting their products (mostly raw materials) gives them the opportunity to earn much-needed hard currency and bolster their foreign reserves.
For the rest of this article, we shall focus on fifteen African countries that earn the highest foreign exchange through exports of products and services. This is particularly important now that many African countries, from Nigeria to Kenya, are grappling with chronic dollar shortages. Perhaps the answer to the problem is for these countries to find ways to export more products and services so they can earn more forex.
Pascal Lamy: Africa’s position at Cop27 (African Business)
Few people understand issues of international trade, development and environment as well as Pascal Lamy. Following eight years as director-general of the World Trade Organisation, Lamy now serves on the board of the Mo Ibrahim Foundation, one of Africa’s most influential civil society organisations. He joins us following the release of the Foundation’s 2022 Governance Forum report, which aims to make Africa’s case in the global climate change debate ahead of Cop27 in Egypt in November.
Framing it as a race between demography and economy, Lamy wants to see Africa’s development needs prioritised in the global response to climate change. Africa is prepared to fight for its position, he says, and highlights South-South solidarity as a countervailing force against the US, China, EU and other heavyweights.
Africa is already a large positive for the global climate ledger, and Pascal outlines further opportunities for the continent to support global climate solutions. Governance will be key, he says, explaining the Mo Ibrahim Foundation’s work on governance monitoring, assessment and improvement.
The New U.S. Africa Strategy Breaks From the Status Quo—With Some Perplexing Stumbles (Carnegie Endowment for International Peace)
On Monday, U.S. Secretary of State Antony Blinken introduced the Biden administration’s much-awaited strategy for Africa. Speaking in South Africa, during his second trip to the continent in less than a year, Blinken outlined the policy against a backdrop of the pandemic, the war in Ukraine, and a global economic slowdown. Although somewhat comparable to recently launched initiatives for Latin America and the Indo-Pacific, the Africa strategy stands out as an uniquely elaborate effort at a moment when the administration is working to revamp U.S. relations across the globe.
At its core, the strategy articulates a vision for a twenty-first century U.S.-African partnership motivated by discernible global shifts. One motivation is the realization of Africa’s importance to U.S. global priorities, such as the continent’s rapidly growing population, one of the world’s largest trading blocs, significant natural resources endowments, and a sizable voting bloc in the United Nations.
U.S.-Africa partnerships advance shared ideals (ShareAmerica)
The planned partnership will help Thunes to expand its presence in some of the 35 sub-Saharan countries where it operates, as well as add new markets, Yao says from the company’s regional head office in Nairobi. Thunes aims to add 13 new sub-Saharan countries by the end of 2023 and has identified Angola and Namibia as priority new markets for entry, Yao says.
Remittances can be made instantly from international Thunes partners to African countries such as Kenya, Ghana and Tanzania which have a “real-time switch” for bank transfers. Africa lags behind the rest of the world in terms of real-time remittances. Last year, according to ACI Worldwide, 20 African states remained absent from any kind of real-time payments system.
The Government of the Republic of Barbados will be hosting the first ever edition of the AfriCaribbean Trade and Investment Forum (ACTIF) which is being convened by African Export-Import Bank (Afreximbank) and Government of Barbados in collaboration with African Union Commission (AUC), African Continental Free Trade Area (AfCFTA) Secretariat, Africa Business Council, the Caribbean Community Secretariat, and Caribbean Export Development Agency.
The main goal of the AfriCaribbean Trade and Investment Forum is to provide a platform for the development of strategic partnerships between the business communities in Africa and the CARICOM Region with the objective of fostering bilateral cooperation and engagement in trade, investment, technology transfer, innovation, tourism, culture and other services. The Forum will also be used as a vehicle to actively promote trade and investment opportunities among people of Africa and the Caribbean, as well as the wider diaspora which will contribute to the implementation of the African Continental Free Trade Agreement (AfCFTA) and to the Caribbean trade development agenda.
Frequent disruptions in supply chains have exposed the vulnerability of transport and logistics operations amid unequal capabilities and resources between countries. Recurrent extreme weather events, the COVID-19 pandemic, the war in Ukraine and other crises illustrate the magnitude of the challenge and its implications for global supply chains and sustainable development. These challenges underscore the need to enhance resilience, particularly in the most vulnerable economies. “As disruptions are becoming part of the new normal, resilience and risk management emerge as new mantras for transport, logistics, trade and supply chains,” said Shamika N. Sirimanne, director of UNCTAD’s technology and logistics division.
To help countries cope with the new normal, UNCTAD has launched a new website to promote resilient maritime logistics in the face of disruptions. The website includes a guidebook for ports entitled “Building Capacity to Manage Risks and Enhance Resilience” and a wealth of other resources. “The web package provides our beneficiaries with support in risk identification, assessment, management tools and approaches, case studies, good practices and a step-by-step resilience-building process for ports and other relevant maritime supply chain actors,” she added.
The Commonwealth Secretary-General has called for a holistic and multi-disciplinary approach to tackle the increasing threat of food insecurity across the world, which has been exacerbated by the COVID-19 pandemic, conflict, the climate crisis, and political, social and economic inequalities. Speaking at an event held in the margins of the Birmingham 2022 Commonwealth Games on 29 July 2022, the Secretary-General committed to making food security a primary focus, urging the international community to step forward with practical and financial support for countries facing famine and people facing starvation. The UK House panel discussion saw Commonwealth leaders, policymakers, and academics discuss how university-led partnerships are key to translating research and expertise into action on the pressing global challenge of food security, biodiversity loss and climate action.
In her keynote address, the Commonwealth Secretary-General, The Rt Hon Patricia Scotland QC, highlighted the critical need for international experts, academics, and policymakers to work together, across sectors and disciplines, to develop practical solutions to issues such as climate change and food security, and support sustainable growth across the Commonwealth.
According to the International Labour Organization (ILO), the pandemic has caused many additional problems for 15 to 24-year-olds who’ve experienced “much higher” unemployment losses than older workers since the global health emergency was declared in early 2020. Young women have struggled more than their male counterparts to find work, while Arab nations are expected to see the highest levels of youth unemployment by the end of the year, compared to the global average. “We know that the COVID-19 pandemic has wreaked havoc on youth labour markets around the world,” said Martha Newton, ILO Deputy Director-General for Policy. “It’s exposed a number of shortcomings in the way the needs of young people are addressed, especially the most vulnerable first-time job seekers, school dropouts, fresh graduates with little experience and those who remain inactive not by choice.”
Speaking at the launch of ILO’s report, Global Employment Trends for Youth 2022: Investing in transforming futures for young people, Ms. Newton said that the share of youth not in employment, education or training in 2020 rose to 23.3 per cent.