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Big changes proposed for carbon tax in South Africa (BusinessTech)
The Energy Council of South Africa, alongside other big business figureheads, have put forward recommendations for the country’s carbon tax under the proposed Taxation Laws Amendment Bill. As a multi-representative body, including Business Leadership South Africa (BLSA), Business Unity South Africa (BUSA), the South African Petroleum Industry Association (SAPIA) and Energy Intensive Users Group (EIUG), the group said that there are key areas that can be improved on the proposed carbon tax to advert identified unintended consequences. The energy council said that business is sharing recommendations to avoid just transition impacts earlier than planned and to avoid unintended or adverse consequences to an already fragile economy.
“Business’s priority is to positively fulfil our role for a decarbonised and sustainable South African economy. We are committed to an energy transition that is just and equitable for the country and look forward to partnering with the South African government to realise this journey,” said the council.
The group listed the following six changes: 1) Revision of the carbon tax proposal; 2) Retaining the current allowance and introducing more policies; 3) Revision of implementation timelines; 4) Bottom-up analysis for hard-to-abate and vulnerable sectors; 5) A study of carbon tax pass-through; and 6) Enabling a just transition
South Africa’s $8.5 billion move away from coal comes with a big catch (BusinessTech)
President Cyril Ramaphosa’s pledge to lessen the country’s dependency on coal energy has been green-lit, but the money promised by foreign jurisdictions is coming with more terms and conditions than expected. Speaking to Bloomberg, minister of environment, forestry and fisheries, Barbara Creecy said that the government underestimated how complicated the offer was when it was made. She said that there are several partners and development institutions involved, and they have their own terms and conditions based on their individual fiscal cycles.
According to a study conducted by COP26, South Africa is the world’s 13th biggest source of greenhouse gases and will need to spend over $250 billion over the next 30 years to fund the closing of coal-fired plants and develop green alternatives. Creecy said negotiators are discussing what proportion of the climate funding pledged by the US, UK, Germany, France and European Union last year will be in the form of concessional loans and grants.
UBA DMD Urges Exporters to Repatriate Proceeds to Ease Forex Pressure (This Day)
The Deputy Managing Director of the United Bank for Africa (UBA) Plc, Mr. Muyiwa Akinyemi at the weekend advised exporters in the country to always repatriate their proceeds back to the country in order to ease pressure in the foreign exchange (forex) market, support the naira and boost the economy. Akinyemi, said this in a presentation titled: “Boosting Domestic Capacity for Sustainable Export Earnings – UBA Perspectives,” he delivered at the 2022 annual conference of the Finance Correspondents Association of Nigeria (FICAN), held in Lagos.
“Most times exporters people complain that the Central Bank of Nigeria (CBN) does not give dollars, but then exporters must also do their part. A lot of export proceeds are not being repatriated to Nigeria today and that is a challenge.
In his presentation, Akinyemi, noted that 200 exporters accounted for 95 per cent of the $4.2 billion Nigeria earned from non-oil exports in the country in 2021. He explained that the $4.2 billion recorded in 2021, did not include informal exports largely in the wholesale trading in some sectors such as information technology, entertainment and solid minerals.
Zimbabwe must step up to increase exports, says UK (Bulawayo24 News)
The United Kingdom (UK) embassy said Zimbabwe could boost its exports to the European country through the Economic Partnership Agreement (EPA), but said it needed to step up. The British head of trade policy, Southern Africa, Charlie Morris made the revelations while making his presentation on the topic of accessing the UK market post Brexit at a two-day National Trade Tariff conference at the Zimbabwe International Trade Fair (ZITF) premises in Bulawayo last week. Morris said there were some changes to UK’s import controls that had been applied from January 2021 based on principles set out in the World Trade Organisation.
“Trade does not come in a vacuum, support is there for the export capacity of Zimbabwe, exports are key features of trading. There are some changes to the UK’s phytosanitary import controls that have been applied since January 2021,” Morris said. “As a result of these changes, some commodities have been deregulated, and this includes citrus fruit and leaves. Stronger requirements have been introduced for some other commodities.
NECA to Government: Don’t Tax Us Out of Existence (This Day)
A member of the organised private sector of Nigeria (OPSN) has called on the federal government to avoid increasing the burden on operators in the real sector of Nigerian economy with additional taxes and stringent regulatory environment. This call was made yesterday by the Director General of the Nigeria Employers’ Consultative Association (NECA), Mr. Adewale-Smatt Oyerinde, in a statement titled, “Beyond Rhetoric: NECA Calls for Urgent Action to Save the Real Sector.”
Oyerinde stated that while it was necessary and critical to for government to generate revenue to fund the 2023 national budget and liquidate interest accruing on its debts, “government will do well not to further burden the real sector with additional taxes and stringent regulatory environment.” He argued that, “it is in the best interest of government to protect the real sector rather than tax it out of existence.”
“As the AfCFTA comes into full swing, Nigeria cannot afford to become a dumping ground for cheap imported products because we have refused to protect local businesses. As a panacea to the ever reducing Foreign Direct Investments, rising unemployment and multi-facet revenue challenges, government and its agencies must protect local businesses and make the operating environment more hospitable.”
Five ships discharge N54.2bn soya bean oil at Lagos Port (New Telegraph)
Despite Nigeria being the second producer of soya bean in Africa, five vessels have offloaded 48,566 tonnes of soya bean oil valued at N54.2 billion ($77.4 million) at the Lagos Port Complex, Apapa, in three months.
The price of the oil is $1,598.78 per tonne in the global market as Argentina, the world’s top exporter of processed soya oil and meal, hiked its tariff by 33 per cent due to Russia’s invasion of Ukraine and drought.
Nigeria’s soy bean annual production is estimated at 1.25 million tonnes valued at N475.4 billion ($679.18 million), while South Africa produces two million tonnes yearly. Presently, soy bean oil is a major complement to palm oil in the domestic supply equation for edible vegetable oils in the country, leading to a rise in demand from infant food manufacturers, who use soybeans because of its high nutritional value. Between 2018 and 2021, Nigeria imported 1.6 million tonnes of soya meal valued at N532 billion ($760 million).
African trade and integration
Crisis ‘wakes Africa up’ to cut food import reliance (The New Times)
Africa’s annual food import bill more than tripled from $15 billion during the food crisis of 2008 to about $55 billion amid the current one, according to the Alliance for a Green Revolution in Africa (AGRA). Agriculture sector experts hold that this trend should be reversed, as the situation is costing jobs and livelihoods to the continent’s citizens.
The African Development Bank (AfDB) also projected that the continent’s food import bill was anticipated to rise to $110 billion within the next three years – by 2025 – if the status quo is not changed.
During the 12th African Green Revolution Forum (AGRF) Summit which concluded in Kigali on September 9, “Heads of state stressed the need to boost Africa’s food production to reduce the need for imports and be better able to withstand shocks, and to increase public expenditure,” according to a resulting declaration.
IMF roots for cross-border Africa trade to stem rising food insecurity (The East African)
The International Monetary Fund is appealing to African countries to open up their local markets to commodities from their regional peers as a long-term solution to persistent food shortages. Last week, the fund released a policy paper urging countries to expand cross-border trade to better deal with the rising food crisis on the continent. According to the paper “How Africa can Escape Chronic Food Insecurity amid Climate Change”, only 15 percent of food imports into the continent are from neighbouring countries.
“African countries have not lifted most of the restrictions even though it could benefit both net food importers and exporters from trading with one another,” states the document authored by a team of African economists.
“In the context of climate change, greater regional trade integration can enhance food availability and affordability,” the paper says. “Combined with resilient storage and transport infrastructure, it can facilitate sales of one country’s bumper harvests — that may have gone to waste — to a neighbouring country facing shortfalls.”
AfCFTA positioning women and youth as drivers of intra-African trade (Graca Machel Trust)
The African Continental Free Trade Area (AfCFTA) Conference on Women and Youth in Trade, convened under the patronage of Tanzania President H.E. Samia Suluhu Hassan and in conjunction with the Government of Tanzania, Champion of Women and Youth in Trade under the AfCFTA Conference themed “Women and Youth: The Engine of AfCFTA Trade in Africa” took place from 12 to 14 September 2022, in Dar-Es-Salam. Women, youth, and political and business leaders from across the continent joined arms to discuss how women and youth as drivers of intra-African trade can be positioned at the centre of the economic benefits of the AfCFTA.
Ms Chisha acknowledged the contributions of women and youth to the economy. She said, “if women can successfully trade amongst themselves in an improvised manner, only their imagination can limit how far they can go when they are eventually all supported with the right financial and technological tools to trade across borders and thereby scaling up their enterprises.”
“The AfCFTA, now supported by the Protocol on Women and Youth in Trade, will not just integrate the continent but is meant to draw from the power of women entrepreneurs locally, regionally, inter-regionally, and at the continental level”, said Representing Graça Machel Trust, Ms Shiphra Chisha, the Trust’s Director of Programs. She also emphasised that there is a need for budget planners and decision-makers to ensure the allocation of funding to train women and support local businesses so that women will have the financial, technological, legal, and administrative understanding to engage in transnational trade.
Africa’s Has An Untapped Export Potential Of $31 Billion (Africa.com)
United National Conference on Trade and Development says Africa’s untapped export of $31 billion can be achieved if Africa implements partial tariff liberalisation under the African Continental Free Trade Area (ACFTA) Agreement over the next five years. Currently, trade between African countries comprises 61% of processed and semi-processed goods. Infrastructure and the harmonisation of logistics will make the AfCFTA fly, including simplicity of moving goods, automation, services across countries and cross-border clearance processes, among other challenges hampering trade.
According to Jürgen Maier, Owner of Mobility Advisors in Switzerland and Partner and Adviser at the Transport Evolution Africa Forum and Expo 2022, automation is one of the key areas to increasing Africa’s transport efficiency and customer orientation. However, in order to achieve the full benefit of automation, the industry must ensure that it incorporates the following trends into a comprehensive and collaborative growth strategy.
“What’s still missing, is a clear, legal master plan that defines benchmarks and framework conditions, and serves as a starting point for sustainable, cost-effective, coordinated, and successful development,” adds Maier. “This plan should cover automation, processes, digitalisation as well as legal and technical harmonization. Most importantly, for automation to fulfill its full potential, the overall system needs to be co-developed on common principles, not just at a national level, but in partnership with AfCFTA.”
Senegalese President and African Union chairperson Macky Sall has told development partners of the African Development Fund (ADF) to allow the fund to tap capital markets for more resources to meet the critical development needs of member countries. The African Development Fund is the African Development Bank Group’s concessional lending arm that supports the continent’s low-income countries
Sall said: “These are tough times for governments. We need investment and development. Today, youth are raising their voices, demanding employment. They are impatient. Governments must listen and invest more to create jobs and make African economies more competitive. The African Development Fund needs significant financing and should be allowed to go the capital markets.”
Speaking earlier at the start of the third ADF-16 replenishment meeting, Adesina said a significant addition of resources would help the fund address multiple challenges, notably, the devastating impacts of Covid-19, rising debt and economic vulnerability, a growing climate change disruption, and the threat of a food crisis triggered by Russia’s war in Ukraine.
Kenya’s new move on SGR to upset China and Uganda (The East African)
This week’s order by Kenyan President William Ruto to revert cargo clearing services to the port of Mombasa could upset China and Uganda, the port’s biggest clients, and trigger anxiety among major players who depend on it. The order, issued as President Ruto took office, is set to have far-reaching ramifications.
The key question is what China’s reaction will be, given that Kenya must still meet its end of the bargain on the standard gauge railway (SGR) cargo operation numbers and debt repayments. But more importantly, will be whether port operations’ efficiency that has currently seen goods reach Uganda in a record four days after being offloaded at the Mombasa port will continue. The shortened time was due to the seamless systems that directly fed the SGR, and onwards to the Nairobi Inland Container depot and the Naivasha dry port.
Kenya’s move also comes as neighbour Tanzania steps up its efforts to connect the Dar es Salaam port with other East African countries through the Central Corridor.
He said his actions were aimed at restoring thousands of jobs that had been lost in the logistics sector in Mombasa when former president Kenyatta issued an order for all cargo coming through the port of Mombasa to be hauled by the SGR, and cleared at either Nairobi or the Naivasha Inland Container Depot (ICD).”This afternoon, I will be issuing instructions for clearance of all goods and other attendant operational issues to revert to the port of Mombasa. This restores thousands of jobs in the city of Mombasa,” said President Ruto on Tuesday. But even as cargo operations are ordered back to Mombasa, the question now is how Kenya will repay the SGR loan considering that the repayments will more than double in the financial year starting this July, when there will be increased payment of principal sums to the Exim Bank of China for the project.
Uganda furious at EU for censuring oil project over rights abuse (The East African)
The Ugandan parliament has dismissed a resolution by the European Union (EU) parliament to halt the development of the country’s oil sector, citing environmental concerns and human rights abuses, as economic racism. Thomas Tayebwa, deputy Speaker of the Ugandan parliament, said the motion by the EU parliament seeks to curtail the progress of Uganda’s oil and gas developments and by extension, the country’s socio-economic growth and development. “It also seeks to deny Ugandans and East Africans the benefits and opportunities from the oil and gas sector. This represents the highest form of economic racism against developing countries,” Tayebwa said.
Earlier, the European Parliament had fingered the joint oil production and transportation by Uganda and Tanzania, calling on the EU and the international community to exert “maximum pressure” on the two countries over associated human rights abuses and environmental concerns.
Europe bias against EACOP (The Independent)
The EU resolution speaks of general lack of compliance with human rights standards and human rights violations around the East Africa Crude Oil Pipeline (EACOP) project in Uganda and Tanzania, wrongful imprisonment of human rights defenders, arbitrary suspension of NGOs, eviction of hundred from their land without fair and adequate compensation, and blocking human rights activists, journalists, and civil society groups from accessing the oil activity region. The EU motion argues this will enable Ugandan and Tanzanian authorities, as well as the project promoters and stakeholders “to better safeguard protected and sensitive ecosystems and the water resources of Uganda and Tanzania, limiting the vulnerability of the watersheds in the African Great Lakes region, which is a critical resource for the region”.
Africa domestic flights set to grow at 6pc (The East African)
Aircraft maker Boeing says intra-regional and domestic flight networks across Africa will grow at 6.1 percent compound annual growth rate (CAGR), driving a 20-year demand for 1,010 new airplanes by 2040, valued at $176 billion. The firm said this week that with Europe remaining the most prominent origin/destination for African carriers, overall African air traffic growth is forecast at 5.2 percent, the third highest globally. Boeing provided the data as part of its 2022 Commercial Market Outlook, the company’s long-term assessment of global demand for commercial airplanes and services.
According to the statement, African aviation traffic has recovered strongly in 2022, with pent-up demand and economic growth driven by higher global commodity prices allowing African airlines to recover flight operations to 80 percent of pre-pandemic levels.
“African carriers are well-positioned to support inter-regional traffic growth and capture market share by offering services that efficiently connect passengers and enable commerce within the continent,” said Randy Heisey, Boeing managing director of Commercial Marketing for Middle East and Africa.
Okonjo-Iweala, Dangote, Adesina, others for Nigeria’s global investment forum in New York (Vanguard)
The Federal Government, in collaboration with the Africa Business Roundtable, is organising the second edition of the Nigeria International Economic Partnership Forum, NIEPF, a global economic investment platform, this time in New York, United States. The business roundtable is in furtherance of the Federal Government’s bid to open up the country’s economy to international capital and attract foreign investments.
A statement by Senior Special Assistant to the President on Media and Publicity, Garba Shehu read: “Holding alongside the annual global gathering, the NIEPF is expected to draw the presence of world leaders in politics, economy, media as well as Civil Society organisations and international media to focus on the vast economic potentials of Nigeria and Africa’s leading economy.”
South Africa, Egypt, and Nigeria possess 56% of Africa’s wealth (Quartz)
Rich countries are donating more money than ever towards food aid in poorer countries. But that money is a bit like a band-aid that doesn’t heal the underlying wound, billionaire Bill Gates explained to Quartz in an interview this week. Instead, he said, donors should be much more focused on supporting basic agricultural research. That way, improvements to protect crops from climate change and boost their yield—technology that is now standard-issue in rich countries and for their staples, like corn and wheat—can be adapted to the climate conditions of sub-Saharan Africa and to crops like cassava and yam. “Certainly without better seeds, we are going to fall short,” he said.
It’s not just food security. The world is not on track to meet almost any of the “sustainable development goals” adopted by the UN in 2015, according to a new report by the Bill and Melinda Gates Foundation. Climate change, the pandemic, and the war in Ukraine all threw wrenches in the works, Gates explained. But donor countries are also stuck in outmoded approaches to aid that undervalue the potential impact of local scientific innovation, which requires sustained, long-term investment, he said.
Looking ahead to the COP27 climate summit in Egypt in November, Gates also said the focus by activists and the host country on climate aid finance may be a distraction: “I hope the meeting ends up being a constructive thing, and not just a shrill “where’s-the-money?” thing,” he said.
Global economy
New DHL: Trade growth atlas global trade surprisingly strong despite recent shocks (DHL)
DHL and NYU Stern School of Business have published the new DHL Trade Growth Atlas, which maps the most important trends and prospects of global trade in goods. The report covers 173 countries, providing valuable business intelligence for policymakers and industry leaders. It shines a positive light on the resilience of global trade – despite recent shocks and market pessimism.
“Our aim is for the DHL Trade Growth Atlas to become a go-to resource for understanding and navigating shifts in the global trade landscape. Trade will remain a key driver of prosperity – as it has been for centuries. In the current global business environment, DHL can help customers rethink certain supply chains, basing them on a sensible trade-off between cost and risk so that they are both efficient and secure. As the world’s leading logistics provider, we offer solutions for all logistics requirements, and have proven to provide stable and reliable services even in volatile market environments,” says John Pearson, CEO of DHL Express.
Sea-Intelligence says carriers have earned nearly $42bn in Q22022 (Africa Aviation News)
Major shipping lines recorded a combined earnings before interest and tax (EBIT) of $41.6 billion for Q22022, and this is discounting CMA CGM that only issued a press release so far, which does not list EBIT, according to the latest update from Sea-Intelligence.
“We should stress that we do not mean this as a value judgement on whether shipping lines making money is a good or a bad thing, and we note it has generally been an unprofitable business for the past decade or so. We are merely pointing out the unprecedented nature of the current market dynamics.”
E-commerce talks resume following summer break, Mauritius joins the initiative (WTO)
The latest cluster of meetings tackled several topics, including implementation periods for a future agreement on e-commerce, in particular for developing and least developed countries, access to online platforms and competition in electronic commerce. The negotiators continued to seek convergence on topics such as cyber security, privacy, telecommunications services, electronic invoicing and electronic transaction frameworks. Two more clusters of meetings will take place in October and November, with co-convenors aiming to issue a more streamlined negotiating text towards the end of this year.
A “stocktaking session” looked at several proposals that have not yet attracted universal support from participants in the negotiations. The proposals were examined to help their proponents decide how to take these proposals forward. Following the withdrawal of proposals from single proponents in July, a further proposal was withdrawn in September due to lack of support. The co-convenors commended members for their flexibility in this regard.
Guterres: ‘Global addiction to fossil fuels’ must end and a ‘renewables revolution’ jumpstarted (UN News)
Achieving a just and equitable energy transition is “one of the biggest challenges facing our world,” UN Secretary-General António Guterres told the Global Compact Board meeting on Sunday.
Climate disasters and skyrocketing fuel prices have made the need to “end our global addiction to fossil fuels” crystal clear, he said, underscoring the importance of investing in renewables, building resilience, and scaling up adaptation. “Had we invested massively in renewable energy in the past, we would not be in the middle of a climate emergency now”.
Renewables are “the only credible path” to real energy security, stable power prices and sustainable employment opportunities, said the UN chief. “Leaders in business as well as government must stop thinking about renewables as a distant project of the future”, underscored the top UN official. “Without renewables, there can be no future”.
Report: Global Internet Bandwidth Rose by 28% in 2022 (This Day)
New research has discovered a rise in global internet bandwidth by 28 per cent in 2022, with TeleGeography, a global telecommunications market research and consulting firm, saying it now stands at 997 Tbps with a four-year CAGR of 29 per cent. The research has also seen that demand quickly transcends terabyte measure this year compared to 2020. According to the report, Africa experienced the most rapid growth of international internet bandwidth, growing at a compound annual rate of 44 per cent between 2018 and 2022.
Asia is right behind Africa, rising at a 35 per cent compound annual rate during the same period. Despite this slower growth rate, global internet bandwidth has almost tripled since 2018. The growth in international internet bandwidth and internet traffic remains similar.
Broadband Commission highlights role of digital technology in globe’s future (Mirage News)
Digital technologies should form the foundation of education and skills-building as communities continue to adapt to the realities brought on by the COVID-19 pandemic, according to the Broadband Commission for Sustainable Development, which met on Sunday at its annual fall meeting. The Broadband Commission, made up of public and private sector leaders, makes policy recommendations centered around broadband connectivity to accelerate progress towards achieving the UN’s 2030 Agenda for Sustainable Development.
At the New York meeting, the global technology and development body also emphasized the need for public-private cooperation to develop national strategies to enhance digital skills and advance school connectivity.
“We have made significant progress globally in ensuring universal access to broadband continues to improve, but much remains to be done,” said Paula Ingabire, Rwanda’s Minister of Information Communication Technology and Innovation representing Rwandan President Paul Kagame, Co-Chair of the Commission
During the meeting, convened ahead of the U.N.’s Transforming Education Summit at the opening of the 77th Session of the U.N. General Assembly, the Commission called for universal, inclusive and affordable connectivity for the digital transformation of education. “Accelerating broadband for the new realities of a rapidly changing world is as important as it is timely,” said Catherine M. Russell, Executive Director of UNICEF and a Commissioner of the Broadband Commission
The meeting also explored innovative approaches to increasing affordability of access to digital services and devices-including for home-based work and learning-with a focus on micro, small and medium-sized enterprises (MSMEs) and the most vulnerable populations. The approaches examined considered the current economic environment.
