tralac Daily News
Coastal communities call for greater consultation on oil and gas exploration (Engineering News)
Large- and small-scale fishers and communities on the Wild Coast of South Africa request that, at the very least, more scientific research be done on the effects of exploration activities, and that various stakeholders undertake greater engagement about such activities to gain a better understanding of any potential impacts of the activities.
This was the message conveyed by community leaders who came together at the second precolloquium dialogue on August 25 at the Cape Town International Convention Centre to discuss the possible “coexistence of the upstream petroleum and fishing industries in South Africa”.
A joint statement by various community and environmental organisations describes the engagement as an attempt to “pacify and weaken” the clear message small-scale fishing communities have been sending to the DMRE and Pasa against the “pillaging” of their coastal waters. “Oil and gas development and fishing activities cannot coexist,” reads the statement.
The Mauritian government, through its finance ministry, has opened its doors and invited South African businesses and the government to strengthen trade relations and invest in the East African island country.
Following the impact of the Covid-19 pandemic, which had the world’s economies reeling from the closure of businesses, Africa was once again on its own when developed countries shut their doors, leaving the continent vulnerable, said Dr Renganaden Padayachy, Mauritian Minister of Finance, Economic Planning and Development.
Padayachy stated that African companies needed to take advantage of trade agreements to develop the continent and grow its economy, and African countries should ensure that the continent’s minerals were processed in Africa rather than being processed outside the continent.
Climate change could be consequential for Rwanda’s growth given the reliance of the economy on climate sensitive sectors. The Rwanda Country Climate and Development Report (CCDR) launched today highlights key policies and interventions that are needed in Rwanda to strengthen climate resilience in the context of the country’s commitments under the Paris Agreement and its development priorities.
‘No GMOs in Zambia’ – stakeholders (Farmers Review Africa)
THERE is a misunderstanding between state and non-state actors on the planned revision of the 2002-Genetically Modified Organisations (GMOs) policy in Zambia with the latter insisting on the retention of the ‘traditional agroecology’ to avert insecurity and protect Zambia’s food sovereignty.
In recent years, there have been attempts by the Government to review the GMO (National Biotechnology and Biosafety Policy) at the expense of the traditionally accepted farming systems already in place which are ‘free from any modification’.
The inducing of the modified organisms have induced devastating effects on the soil, affecting yields from year to year-thus affecting farming profitability, remain hazardous to human life and the environment while further threatening the country-known to produce “non GMO maize and other produce fail to compete on export markets.
Ghana’s sovereign debt woes did not come as a surprise to many. The tell-tale signs were always there, like writing on the wall. The Ghana sovereign debt debacle is one episode in a series of emerging African markets and low-income countries caught in a perfect storm. The perfect storm is made of rising global interest rates, a strengthening United States dollar and excessive borrowing by African countries and those that can be classified as emerging economies.
Ghana appears to have become a victim of its success and, dare it be said, a bit of hubris. The country is struggling under an unsustainable debt load in 2022 when it successfully floated a US$ 3 billion Eurobond in 2021. Ever since the dawn of multiparty democracy, the West African country has been a stable jurisdiction, which has helped it to attract consistently high levels of foreign direct investment from investors who view the country as a gateway into West Africa together with Nigeria.
Perhaps most profoundly, the Africa Continental Free Trade Area (AfCFTA) opened its secretariat office in Accra. According to the number of participating countries, this development alone put Ghana at the centre of the largest free trade area. On the face of Ghana should not be struggling with its finances if its record with FDI is any indicator of the country’s economic prospects. In 2007 discoveries of oil were made off its coast. Ghana has three major offshore oil and gas fields: Jubilee, Sankofa, and Twenenoa Enyenra Ntomme.
The oil and gas fields have attracted big-name producers like Kosmos Energy and Tullow Oil. Other producers have left the west African country, citing the adoption of ESG principles and net zero goals.
Ghana’s exports to Burkina Faso have increased to $276 million in 2021 from $264 million in 2020. Meanwhile, its imports from Burkina Faso amounted to $50 million over the same period. Similarly, the Export Potential Map projection based on demand and supply, market access conditions and bilateral ease of trade showed that the total value of the 51 leading products from Ghana to Burkina Faso amounts to 8.4 billion dollars. Mr Clement Osei-Amoako, President of the GNCCI, said out of this amount Ghana was exporting only 33 per cent, representing 2.8 billion dollars.
Mr Osei-Amoako said this during the opening of a five-day Economic and Trade Promotion Days (JPEC) event in Accra. The event was on the topic: “Strengthening Economic and Trade partnership between Burkina Faso and Ghana: Which synergies of actions in the current context of the implementation of African Continental Free Trade Area (AfCFTA).”
Stakeholders in the agri-business sector have expressed concerns that the lack of a standardisation policy for the country may deny Nigeria the much-expected benefits of the African Continental Free Trade Area (AfCFTA) agreement whose implementation had already commenced. They believed that as actual trading among African countries is about to begin in earnest, Nigerian SMEs seemed unprepared to take advantage of the opportunity presented by the agreement because they are still lagging behind global best practices.
The stakeholders at a one-day consultative workshop on the development of the national Agricultural Commodity Standards Grading System (AgCSGS) and Policy Framework, said a lot still needed to be done in terms of the quality of products and services SMEs supply, particularly agricultural commodities.
In an interview with THISDAY, Director-General, Nigeria Agri-Business Group (NABG), Mr. Manzo Maigari, said compliance and alignment with the global benchmark for standards and trading is currently lacking among Nigerian businesses. He said, “But in modern business and trade today, people want to be sure of the quality, the sanitation, and the hygiene of what you are selling and if they cannot, be sure that you cannot have access to their markets.
“We can play locally and manage and do whatever we want to do but if we want to sell internationally, if we want to be competitive in agriculture globally, then we must comply and align ourselves to global benchmark for standards and trading. And this is what does not exist currently in Nigeria.”
The Federal Government is set to feast on the blossoming digital economy to improve Nigeria’s balance of payments position with a projection of 242 percent rise in the export of value-added services to N6.5 trillion in 2025 from N1.9 trillion recorded in 2021. This is even as it expects the nation’s current account balance within the period to increase by 632 percent to N3.2 trillion (2025) from N436.9 billion (2021).
The projection is contained in the final draft of the 2023 – 2025 Medium Term Expenditure Framework and Fiscal Strategy Paper (MTEF & FSP) prepared by the Budget Office of the federation for the National Assembly’s endorsement.
Africa trade report: Many challenges, and few opportunities (Global Trade Review)
After a better-than-expected post-pandemic rebound last year, economic growth in Sub-Saharan Africa is expected to stall in 2022, dropping from 4.6% in 2021 to 3.8%, according to the International Monetary Fund (IMF), as the global shock triggered by Russia’s invasion of Ukraine sets back the region’s prospects.
“Disruptions to global trade and supply chains – primarily in agricultural, fertiliser, and energy sectors – following the Russia-Ukraine conflict and the corresponding sanctions on trade with Russia have tilted the balance of risks to Africa’s economic outlook to the downside,” says AfDB president Akinwumi Adesina in the multilateral institution’s Africa Economic Outlook Report 2022.
“The impact is, however, likely to be asymmetrical. On the one hand, net oil- and other commodity-exporting African countries could benefit from higher prices of their exported commodities. On the other, the impacts on net energy-, food-, and other commodity-importing countries are concerning as higher food and energy prices will exacerbate inflationary pressures and constrain economic activity.”
As part of strategies to resolve payment-related barriers in the actualization of the African Continental Free Trade Area (AfCFTA), the Chartered Institute of Bankers of Nigeria (CIBN) has signed a Memorandum of Understanding (MoU) with Pan- African and Payment Settlement System (PAPSS).
The MoU was signed between both organizations at the recently concluded CIBN’s 15th annual Banking and Finance Conference which held in Abuja with the theme ‘‘Repositioning the Financial Services Industry for an Evolving Glocal Context”.
A communiqué released by CIBN at the end of the two-day conference, noted that Focus on improving trade by resolving payments-related barriers is a fundamental requirement for the success of the AfCFTA which has been highlighted by the PAPSS.
The declaration was made at the ITUC-Africa Trade Union Continental Forum on the AfCFTA which was held under the theme: Ensuring decent work in the framework of the AfCFTA implementation – towards the inclusion of the positions of the trade unions in the AfCFTA processes.
According to the declaration a “space for social dialogue must be created at the national, regional and continental level for African citizens, and their socio-economic groupings — that is workers including those of the informal economy, farmers, traders, producers, enterprises, civil society, private sector – to participate effectively in a democratic and transparent process and ensure the reflection of their concerns and views in the negotiations.”
Dr Monique Nsanzabaganwa, Deputy Chairperson, African Union (AU) Commission, says the design of the African Continental Free Trade Area (AfCFTA) would offer Africans an enabling environment to raise revenues and access resources in an economically integrated continent. This, she said, would lift Africans out of poverty.
She noted that it is critical to foster an inclusive and sustainable socio-economic development agenda that is anchored on the people who are to benefit from such development. “It is also important to ensure the effective implementation of supporting policies and programmes,” Dr Nsanzabaganwa stated at AfCFTA Conference on Women and Youth in Trade in Dar es Salaam, Tanzania, a document made available to the Ghana News Agency showed.
For women and youth to take advantage of opportunities offered by the AfCFTA Agreement, Dr Nsanzabaganwa said they must have the capacity to access financial products and other factors of production to build and scale up their businesses in order to meet the demands of an AfCFTA market. “Financial inclusion is intrinsically linked to trade and is essential to the success of the AfCFTA. Indeed, for women and youth to access funds to grow and scale up their businesses, they must operate within the formal financial system.”
Africa risks losing out on trade as rich countries cement relationships with trusted partners (The Conversation Africa)
Over the past few years, the world’s supply chains have been strained and disrupted by the COVID pandemic, Russia’s invasion of Ukraine, and rising geopolitical tensions. These started with the US-China trade war and then intensified following the war in Ukraine.
In response to the cumulative economic and security fallout that has ensued, some advanced countries are now ramping up efforts to divert their supply chains away from countries that are not like-minded and that don’t have shared common values.
This new supply chain strategy is called “friend-shoring.” Advanced countries are creating friend-shoring alliances which are, in turn, reshaping our global economy.
These shifts have adverse implications for Africa. The approaches to reconfiguring supply chains currently unfolding threaten to heap more stress on a continent already weighed down by multiple crises.
Africa stands to lose out because the current reshaping of supply chains is not intended to shift trade, investments and jobs towards African trade partners. Rather it’s got to do with efforts by the EU and US to insulate their supply chains from being disrupted for geopolitical reasons by less trusted.
The African Union has long championed reforms for the UN Security Council. The AU argues that the UN Security Council, with its five permanent members — the US, Russia, China, France and the UK — does not offer the continent a voice in global affairs.
Africa has been pushing for a permanent seat at the UN Security Council since 2005, Emmanuel Bensah, Deputy Executive Director, African Continental Free Trade Area (AfCFTA) Policy Network Communications Expert for the African Union, told DW. “This is one of the reasons why the African Union set up its own peace and security council modeled after the UN Security Council,” Bensah said, adding that the UN has and will always be the global multilateral player. “Therefore, it is important [for the AU] to have a voice there [at the UN Permanent Security Council], the AU expert on free trade said, adding that the AU needs to lobby outside the continent to garner more support for a seat at the UN permanent Security Council.
In Africa, we are already seeing the devastating effects of climate change, even though the continent produces less than 4% of the world’s carbon emissions. Temperatures on the continent have risen faster than the global average, resulting in tropical storms in Madagascar and Mozambique, flooding in South Africa, and one of the worst droughts ever seen in the Horn of Africa. According to the Mo Ibrahim Foundation, 40 million people in Africa could be pushed into extreme poverty by 2030 due to the ripple effects of climate change. We need to act now to prevent further damage and suffering.
According to EY, 92 percent of oil and gas firms plan on investing in AI or will do so in the next two years. This is a massive shift in the way that these companies operate, and it will have a significant impact on the climate. The African population’s access to affordable energy is the most pressing and immediate priority. The need for energy services throughout Africa will proliferate; making sure it remains affordable is urgent. Achieving universal access to affordable electricity by 2030, as shown in the Sustainable Africa Scenario, requires adding 90 million people to the power grid each year–triple the rate of recent years. In fact, According to the International Energy Agency, global renewable energy capacity broke a new record in 2021 with the addition of 295 gigawatts of power and is expected to reach 320 gigawatts in 2022.
As a result, we are seeing the beginnings of a green energy revolution taking place across Africa.
President Obasanjo stated, “I will challenge this forum to really work out what should be the factors that our leaders should consider, what should be the factors that Africans in the private sector will consider, and what will be the factors that foreign investors will need and consider to be able to power Africa in terms of our development economically and socially.”
Following President Obajsanjo, Director General of the World Trade Organization, Dr. Ngozi Okonjo-Iweala who also spoke at the event, said that Africa could not industrialize or have a solid continental manufacturing base without energy, “At the same time, the world is being buffeted by numerous manmade and natural exogenous shocks that are difficult for policymakers to manage. These shocks hit a continent struggling to manage simultaneous health, debt, and energy crises with limited fiscal space. But we must not lose sight of the opportunities of this crisis. Africa is abundantly endowed with energy resources from gas to renewables, all waiting for investment. High global energy prices make new gas investments more evident, especially as a transition mechanism of will. Even as we strive towards renewables, let us focus on mutually beneficial energy investments for Africa and the world by taking up the opportunities to harness the continent’s gas and renewable energy resources.”
THE envisioned African Continental Free Trade Area (AfCFTA) could as well turn into a pipe dream if East African Community (EAC) partner states fail to trade within themselves.
Chief Executive Officer with the Eastern Africa Farmers Federation (EAFF) Stephen Muchiri warned here recently that the African Union (AU) broker could remain far-fetched if member states don’t encourage intra-trade. Mr Muchiri observed that some EAC partner states weren’t fully embracing intra-regional trade, even when they had ratified the agreement. “It is sad to note that we don’t seem to trade among ourselves and this is detrimental to the prospects of AfCFTA,” argued Mr Muchiri.
According to the East African Business Council (EABC) Intra EAC trade currently stands at 12 per cent. This was far from the 78 per cent achieved by the European Union (EU) and the 48 per cent registered by the Southern African Development Community (SADC). “We cannot take advantage of AfCFTA, if we fail to trade among ourselves,” said the EAFF CEO.
Mr Muchiri took issue with a number of Non-Tariff Barriers (NTBs), which he said was hindering trade growth within the regional economic bloc.
Speaking at the launch of Mkinga Economic Zone in Dar es Salaam on Tuesday, Deputy Minister of Trade and Industry, Exaude Kigahe, said the new zone is expected to create jobs for Tanzanians especially the youth. He said the economic zone in Tanga region is expected to be a game changer in the economic development and partnership in Africa as it acts as a gateway to more than 18 land-locked countries in the region.
According to Shady El Zeki, the Zworld’s board member, the project, worth 300m US dollars (699 billion shillings) in total, is the first smart economic zone in Africa spanning on 650 acres and leading the sustainable and economic development in Africa. The project features world-class technologies like Artificial Intelligence (AI), E-commerce and digital business (virtual company) making it unique in the region.
“The project aims to create vital infrastructure for Mkinga to enhance the economy and to build the foundation for developments taking into consideration the agreements between African nations such as AfCFTA, EAC, SADC, AGOA and many other agreements,” he said. He said so far five investors have shown interest to inject money in the project coming from different nations including Brazil, Egypt, Tunisia, Blugaria, GCC, Philippines, and India.
Tanzania, DR Congo rank poorly on digital life quality: report (The East African)
The Democratic Republic of Congo (DRC) and Tanzania are among the countries with the worst digital quality of life globally, occasioned by slow internet speed, high costs of internet, and other factors. The 2022 Digital Quality of Life Index, produced by Dutch network company Surfshark, reveals that DRC citizens have the least digital wellbeing, out of the 117 countries surveyed, with Tanzania ranking 107.The index measures the quality or speed and affordability of internet in the countries along with the availability and strength of electronic infrastructure, security, and government.
Ahead of COP27, the African Risk Capacity (ARC) outlines the importance of parametric insurance on the African continent, highlighting the need for further collaboration with more developed nations.
RC provides parametric insurance services to African Union member states and farmer organisations to pool disaster-related risk across Africa and transfer it to international risk markets. Since 2014, it has paid out $124,3m in claims from eight risk pools, transferred $1bn risk and covered 30m people per year.
In the past year, ARC paid out $59.6m and covered 18m individuals in countries like Mali, Malawi and Madagascar, and expects the impact will be even greater in 2022.
It adds that insurance products help to build resilience by supporting the implementation of national disaster risk management policies and strategies, particularly the promotion of financial resilience to climatic hazards.
ARC insists that there’s much more work to do to achieve the organisation’s vision of extending climate risk financing to cover the estimated 200m vulnerable people who bear the brunt of climate change impacts on the continent. “We need broader collaborations between private and public sector if we are to reach even more people and close the protection gap,” “As we prepare for COP27, key discussion points must be how these partnerships can build a resilient continent able to respond to extreme weather events and, in doing so, protect the economic development gains made over the last few years. The problem is so big that all of us have a role to play,” Ndlovu concludes.
African Emergency Food Production Facility launched in Gambia (Farmers Review Africa)
African Emergency Food Production Facility (AEFPF) has been launched in Gambia. Minister for Agriculture, Hon. Dr. Demba Sabally performed the launch ceremony. The AEFPF is an additional financing that follows the joint meeting of the ministers of Agriculture and of Finance of the African Union on the African Emergency Food Production plan in which The Gambia participated.
The facility is being supported by the African Development Bank (AfDB) to The Gambia through the Rice Value Chain Transformation Project (RVCTP). Speaking at the launching ceremony, Dr. Sabally informed the gathering that the government of The Gambia is taking major strides to transform the Agriculture sector in addressing food security and meeting the nutritional needs of its people.
“Despite these efforts, The Gambia’s high dependence on imports for staple and key commodities has deepened the country’s vulnerability to external shocks such as the effect of Covid-19 and the impact of the Russia-Ukraine crisis on the food supply system” he stressed.
The Trade Agenda Today by Ngozi Okonjo-Iweala & Anne O. Krueger (Project Syndicate)
Neither the breakdown of multilateralism nor the rise of the digital economy has made international trade and its central governing body any less important. An open, transparent, rules-based trading system remains crucial for driving economic development and addressing global problems like climate change.
From rising populism and the COVID-19 pandemic to Russia’s invasion of Ukraine, this has already been an extraordinarily difficult decade for global trade and the principles, rules, and multilateral institutions that sustain it.
The war affects all multilateral organizations, and the WTO is no exception. Since member states cannot ignore the conflict, they will need to make their views known as they see fit, within the WTO and elsewhere.
To overcome barriers that keep women out of international markets, Dr Okonjo-Iweala called for “active trade policies that ensure non-discrimination and that help women access global value chains” and for “scaling up supply side support to women-owned businesses” so they can make their way into male-dominated sectors. These range from science, finance and technology, to engineering, mathematics and aerospace. “Trade remains a tool to empower women. Trade can propel entire economies forward”, she stressed.
Noting that the most profitable sectors in international trade are male-dominated, Pamela Coke-Hamilton, Executive Director of the International Trade Centre (ITC), called for increased efforts to boost women’s technical expertise and increasing their access to land, finance and machinery. She stressed: “If half of the global population is systematically excluded from participating equally in the economy, how are we to recover in a sustainable fashion?”
As banks expand their sustainable trade finance offerings to meet growing corporate demand, they face a challenge to ensure that stricter environmental, social and governance criteria do not worsen the trade finance gap by cutting off access to financing for companies that need it most.
“We need an honest debate about this. Yes, it could potentially widen the trade finance gap,” Rebecca Harding, CEO of trade data provider Coriolis Technologies, told S&P Global Market Intelligence on the sidelines of the International Trade and Forfaiting Association’s annual conference on Sept. 8. “But, equally, if trade finance is doing its job properly, what it could do is create a transition.”
HSBC Holdings PLC, one of the world’s largest trade finance banks, said it has seen an “unprecedented surge in demand” for sustainable trade finance products, particularly in the wake of COVID-19.