tralac Daily News
Altman Advisory director, economist and National Planning Commission (NPC) commissioner Miriam Altman has emphasised the importance of public infrastructure in light of South Africa’s transformation agenda and getting people in houses and closer to transport networks and services, in addition to its role in stimulating the economy. She was participating in the Business Day Dialogues, held in partnership with building materials manufacturer AfriSam, on November 22, with speakers debating whether infrastructure spend can still be a saving grace for South Africa’s economy, given the headwinds facing the industry. The parties unpacked the value chain factors that should be well thought out and managed to achieve a prosperous South Africa and the National Development Plan objectives.
Altman highlighted the single-most important factor in realising impactful infrastructure spend was a capable State and it being a reliable partner. “So much capacity was destroyed during State capture. When you destroy the procurement function, which is vital in infrastructure delivery, you decimate institutions and performance management.
The UK and South Africa announce joint development, investment partnerships (Engineering News)
The UK announced on Tuesday that it was partnering with South Africa in a number of initiatives and programmes to promote investment in infrastructure and skills development in the latter country. The announcement coincided with the first day of President Cyril Ramaphosa’s State Visit to the UK, the first such visit to be hosted by King Charles III. “South Africa is already the UK’s biggest trading partner on the [African] continent, and we have ambitious plans to turbocharge infrastructure investment and economic growth together,” highlighted UK Prime Minister Rishi Sunak. Prime Minister Sunak and President Ramaphosa will hold bilateral talks on Wednesday. “I look forward to welcoming President Ramaphosa to London this week to discuss how we can deepen the partnership between our two great nations and capitalise on shared opportunities, from trade and tourism and [sic] security and defence.”
The World Bank Group (WBG) Board of Executive Directors today voiced its support for the WBG’s latest six-year strategy to support Kenya in its ongoing efforts towards green, resilient, and inclusive development.
The Kenya Country Partnership Framework (CPF) is a joint strategy between the World Bank, the International Finance Cooperation (IFC), and the Multilateral Investment Guarantee Agency (MIGA) and the government to promote shared prosperity and reduce poverty for the people of Kenya. Informed by extensive stakeholder consultations, the CPF seeks to drive faster and more equitable labor productivity and income growth, greater equity in development outcomes across the country, and help sustain Kenya’s natural capital for greater climate resilience.
“The people of Kenya are in a position to reap even greater dividends from the country’s robust economic growth in terms of more durable poverty reduction,” said Keith Hansen, World Bank Country Director for Kenya. “Tackling the drivers of inequality now will help to ensure that Kenya can achieve and maintain more equitable development in the long run.”
“Kenya’s private sector is poised to drive faster job creation and to seize new opportunities from global and regional integration,” noted Jumoke Jagun-Dokunmu, IFC Regional Director for Kenya. “This will require a more level playing field for competition and innovation for large and small firms and between public and private enterprises.”
Ruto, Museveni pitch business and tech relations in east Asia trips (The East African)
Kenya’s President William Ruto and his Ugandan counterpart Yoweri Museveni are pitching business and technology relations in their separate trips to east Asian countries.
“Kenya is keen on expanding economic ties with the East Asian nation and exploring areas of cooperation, especially in ICT, education, pharmaceutical and infrastructure,” said a dispatch from State House, Nairobi on Tuesday. Ruto is scheduled to attend a business forum to market Kenya “as a suitable investment destination for foreign investors. The visit is also expected to open up job opportunities for tech-savvy youth in both countries,” the dispatch added.
Ruto met with Kenyans in South Korea and was scheduled to meet with his host on Wednesday afternoon. Earlier on Wednesday, he told Korean Speaker of parliament that local legislators need to enact laws to “fix the trade imbalance” with Kenya.
Kenya, he said, is targeting to increase tea, avocado and coffee exports to South Korea to match technology imports to Kenya from the Asian country. “We must move from processing five percent of our tea to 50 percent in the next five years and in 10 years’ time we should be able to process every gram of tea grown in Kenya,” Ruto told a group of Kenyans living in South Korea earlier on Tuesday.
M23 rebels cut off Kenya, Uganda trade routes to DRC (Business Daily)
The M23 rebels have cut off all major supply routes for Ugandan and Kenyan goods to the city of Goma, in the eastern Democratic Republic of Congo (DRC). This has caused financial losses to the two countries. This follows the capture of Rutshuru Town in eastern DRC by the rebels, cutting off the Ishasha border in Kanungu District. The border was the only one still open after the M23 rebels captured the Bungana border town in eastern DRC in June and later took control of the Kitigoma and Busaza borders. Trucks carrying goods from Uganda and Kenya are stuck at the Ishasha border. The drivers say they have been there for weeks. “Dozens of cargo trucks carrying goods from Uganda and other East African countries have been parked at Ishasha border post for two weeks because the drivers got information that the M23 rebels captured Kiwanja territory where they had to pass before arriving in Goma City,” Mr Mwesigye said.
Crisis looms as debt hits Shs80 trillion (Monitor)
As Uganda’s economy faces tough headwinds, it is difficult to tell which way the economy will turn to following some lapses from key decision makers, Prosper Magazine has established. The ripple effect of a double digit inflation, a volatile exchange rate is already being felt on domestic revenue collections, which have stagnated at about 13 per cent of Gross Domestic Product. This is below the sub-Saharan average of 15 per cent.
As government continues borrowing heavily to plug revenue shortfalls, the country’s public debt stock has hit Shs80 trillion amid serious concerns.
This is despite the most recent Afrobarometer survey, completed in early 2022, revealing that the population is growing increasingly discontent with the country’s economic condition as well as their personal living conditions.
In its Monetary Policy Statement for August 2022, Bank of Uganda confirmed that the overall economic growth prospects have been dimmed further with increasing risks of a global recession, and weaker consumer and business sentiments as high inflation and commodity prices continue to erod
Two African countries are inching closer to making an entry into the carbon market as more line up to tap into the lucrative billion-dollars trade. Nigeria has its eyes fixed on the international trade of carbon credits through a continental platform, while Cameroon is developing a strategy that will draw in green financing for the country. Carbon trading is a programme designed to reduce greenhouse gas emissions by giving firms or countries a right to emit carbon dioxide at an agreed price per tonne- rates vary across jurisdictions with most governments yet to agree on trading rules.
Nigeria has begun pioneering a voluntary carbon market programme christened, the Africa Carbon Markets Initiative (ACMI), it said is part of its government plans to achieve net zero emissions.
The initiative, set for an official unveiling during COP 27, is being spearheaded by a 14-member steering committee which Nigeria’s Vice-President, Yemi Osinbajo joined on October 31.
Micro Small and Medium Enterprises, (MSMEs) are seeking more government support to participate in formal markets and scale up their operations to realise their full potential in anticipation of the 2023 budget statement. The business community and MSMEs are also hoping for government to assist in their expansion and consolidate measures to support and integrate into the value chain of corporate businesses in Ghana and external markets across the continent.
These form part of results from the 2023 pre-budget survey conducted by auditing and accounting firm, KPMG Ghana.
The business community is requesting Government to maintain the initiatives already in place and introduce further measures that will mainstream MSMEs into the value chains of large scale companies and markets in Ghana and across the world. The respondents believe that if MSMEs receive more support in the area of access to market, it will boost growth and scale them up to benefit from the Africa Continental Free Trade Agreement (AfCFTA) to promote sustainable job creation.
On November 22, Zambian Minister of Finance Situmbeko Musokotwane and U.S. Ambassador to Zambia Michael Gonzales launched two critical economic development projects funded by the U.S. government – the U.S. Agency for International Development (USAID) Business Enabling Project and USAID TradeBoost. These projects will improve business opportunities, create jobs, and increase incomes for Zambians working in the agriculture, clean energy, trade, and ecotourism sectors.
USAID TradeBoost is a $30 million (almost 500 million kwacha) investment project in Zambia through Prosper Africa’s flagship Africa Trade and Investment program. Its overarching goal is to increase trade and investment nationally, regionally, and internationally that generates inclusive economic growth, particularly for women and youth, through climate-friendly economic approaches. Both projects will counter the rising food insecurity caused by multiple shocks including COVID-19, changing weather patterns, and Russia’s war against Ukraine.
The USAID Business Enabling Project is a $14 million (almost 233 million kwacha) project that will bring inclusive private sector investment and trade to Zambia with a focus on supporting greater opportunities for women in the economy. By strengthening communication between government, industry, and civil society this project will improve policies and business processes to create and expand economically-viable enterprises.
Africa is a continent briming with opportunities for growth and innovation. Our continent is blessed with a wealth of resources and the fastest growing population in the world that promises both a source of human capital and a ready market. To realise this potential, we need to recognize where more work is needed and face our challenges head on.
The lack of industry infrastructure and the inadequate development capital needed by our countries to position themselves to compete with others in the global value chains requires a multi-faceted, coordinated and cross-cutting approach to achieve the necessary structural adjustments that are fit for purpose for Africa’s specific contextual complexities.
Despite its enormous potential, the Industrialization sector in many of our countries remains underdeveloped, and continues to suffer from low productivity and competitiveness. As a result, the contribution of the manufacturing sector to the GDP in the majority of Africa remains under 12% and the share of the global manufacturing remains less than 2%. Africa’s trajectory of industrial output is in stark contrast to the performance of other newly industrialised countries, where manufacturing peaked at 30% contribution to GDP
As we push forward to accelerate Africa’s industrialization drive, AUDA-NEPAD is working closely with our key partners to create the entry points to connect our programmes to ensure that all organs work together and deliver on the continental flagship initiatives. As to AUDA-NEPAD’s current contributions and future plans to support African Women in Processing and the achievement of Africa’s industrialisation, we would like to highlight the following areas of intervention:
The private sector has been challenged to move beyond policy and advocacy towards increased levels of entrepreneurship. Various participants at the “Industrializing the SADC Region: Sharing Strides, Drawbacks and Impact” event convened by the African Union Southern Africa Regional Office (AU-SARO) as part of the activities of the Africa Industrialization Week 2022 commemorative held in Niamey, Niger, underscored the need to promote industrialization on the continent by showcasing the successes, challenges, opportunities and further actions needed from the process to accelerate industrialization in the Southern African region
H.E Ambassador David Claude Pierre, Head of Mission of the African Union Southern Africa Regional Office called on all stakeholders within the region to acknowledge and agree that Industrialization was an important vehicle for promoting economic growth, creating jobs, production of higher value goods, increasing exports and export earnings, improving resource allocation efficiency and creating linkages with other sectors and of sustainable employment opportunities. He noted “the launch of the AfCFTA comes as an opportunity that if successfully implemented, will speed up industrialization and foster economic development”.
The Southern Africa Development Community (SADC) made a presentation on Industrializing the SADC Region, highlighting the opportunities, achievements and challenges. Dr. Johansein Rutaihwa from the Industrial Development and Trade Directorate in SADC gave an overview on industrializing the SADC region, sharing strides, impacts and drawbacks while highlighting the key features of the SADC Industrialization Strategy & Roadmap (SISR). The speakers interrogated the key pillars from the SADC Industrialization Strategy and Roadmap, which include the Industrialization, competitiveness, regional integration and cross-cutting pillar. The goals for the meeting was to dialogue on how to promote industrialization within the region, promote regional integration and increasing manufacturing of goods and exports in the region.
REGIONAL economic diversification efforts and improving trade facilitation are paying dividends for the Southern African Development Community (Sadc), whose intra-trade has risen to 23 percent, up from 19 percent in 2021. The sub-regional trade level is above intra-Africa trade, which is hovering around 15 percent of total continental exports. Citing the latest African Union (AU) Regional Integration Report (2021), the Sadc Secretariate says the improvement reflects the positive impact of ongoing efforts to roll out various provisions of the regional Protocol on Trade.
This includes the implementation of simplified trading arrangements that have enabled an increase in informal cross-border trade covering both agricultural and non-agricultural commodities.
In a statement following the release of the trading report, the Sadc Secretariat said it continues to monitor the progress on regional levels of industrialisation and intra-trade to ensure the scaling up of regional economic diversification.
“Several activities and intermediate outputs have been achieved, but little change has been noted in impact indicators. The share of manufacturing value added to the Gross Domestic Product is still below 12 percent compared to a target of 30 percent by 2030 and 40 percent by 2050.
“Most Sadc member states still depend on agro-based and mining commodities in terms of contribution to GDP.” The region is already developing a regional framework and programme to improve the diversification and restructuring of its industrial base.
This is being done in the context of the region’s identified six priority areas where the value chains can be established and for which regional strategies should be developed. The six priority areas are agro-processing, minerals beneficiation, pharmaceuticals, consumer goods, capital goods, and services.
The United Nations Economic Commission for Africa (ECA), in collaboration with Namibia’s Ministry of Industrialisation and Trade (MIT), facilitated an information sharing and capacity building event on the African Continental Free Trade Agreement (AfCFTA) and the Women and Youth in Trade Protocol, which was held at Windhoek Country Club Resorts. The session was organized as a follow-up to the launch of Namibia’s National AfCFTA Implementation Strategy and Action Plan for 2022-2027, which was held on Monday 21 November 2022 at the same venue.
Tackling trade hurdles between EAC, Indonesia (The Citizen)
Africa accounted for only a fraction of our global trade last year. We exported goods worth $4.1 billion during this period. That translates to only three percent. North Africa led the pack with 34 percent, followed by West Africa (24 percent), East Africa (20 percent), Southern Africa (18 percent), and Central Africa at the tail end.
Recent statistics may not be very promising because EAC imports from Indonesia have dropped by 31 percent in the past five years due, among other factors, to the outbreak of Covid-19. In 2017, the EAC imported goods and services worth $ 961.5 million, but that figure dropped to $ 635.5 million last year. But there is a potential for exports from the EAC following the rebound of economies from the impact of the pandemic.
The bottom line, in my opinion, is that East African businesspeople have little exposure to the Indonesian market. It is rare to hear business people from the two sides interact. More so, it is not common for business delegations from the EAC to visit Indonesia to explore what our huge market can offer exporters from the EAC. What we should do now is enable the business people on both sides to intensify engagement because the potential is there. Indonesia is also a gateway to the ASEAN market.
African climate insurer targets Kenya as its eighth customer (Business Daily)
The African Risk Capacity (ARC) Limited has now set sights on the Kenyan government as it eyes to bag the eighth deal on the continent. The firm, which offers insurance policy covers for governments, communities as well as other humanitarian non-governmental organisations, says the renewed efforts to incorporate more clients are in line with the ongoing global climate debate. Founded in 2012, ARC is a specialised agency of the African Union (AU) that was incorporated to help African governments improve their capacities to better plan, prepare and respond to disasters.
ARC chief executive Lesley Ndlovu told a press briefing yesterday that insurance against natural occurrences by States would be the only sure way to achieve preparedness adding that it is also in line with the loss and damage conversation that prominently featured during the just-concluded COP27 talks.
“The loss and damage conversation that came up during the Egypt conference was very timely. The talk was about the provision of financial instruments and one of the surest ways of making more resources available to combat climate change is actually pooling funds together through commercial insurance,” said Ndlovu.
Logistics infra: Achilles heel of African trade (Logistics Update Africa)
On September 22, 2022, UNCTAD (United Nations Conference on Trade and Development) Secretary-General Rebeca Grynspan gave an example of how West Africa already lost a sowing season due to issues in the global distribution of fertilisers including the price rise and the global disruption of supply chains while addressing the annual summit of the Global Maritime Forum in New York. Even though she was talking about the food availability crisis that the world may face, it also goes to show how Africa is dependent on the maritime supply chain for its economy and food security.
One of the important impediments to Africa’s route of economic progress has been the lack of infrastructure, particularly in the maritime trade and it is visible in the ports and terminals across Africa compared to that in other continents.
“If you produce the goods and there is no transport and logistics it is as good as not producing at all. Because there is a need for goods to reach the final destination. There is a great percentage of funding that must go into logistics,” he said during the TechCabal webinar in August 2022.
Louis Yaw Afful - Executive Director, AfCFTA Policy Network, stressed the need for governments to allocate resources and fund the trade-related infrastructure, especially logistics to improve trade in the free trade area.
AfDB, AU sign $9.73m agreement to drive digital market (New Telegraph)
The African Union Commission (AUC) and the African Development Bank (AfDB) have signed a grant agreement to implement Phase 1 of the Upstream Project for Digital Market Development in Africa. According to a press release, the signing ceremony took place on Friday at AUC Headquarters in Addis Ababa, Ethiopia. The AUC Commissioner for Economic Development, Trade, Tourism, Industry and Minerals, Ambassador Albert Muchanga, and the African Development Bank’s Deputy Director General for the East Africa Region, Abul Kamara, signed the agreement on behalf of their institutions. The statement said that the AfDB’s board of directors approved the grant of 7 million Units of Account ($ 9.73 million) in September this year, adding that the project supports the AUC’s implementation of digital economy projects to enhance a continental single digital market.
It also supports the implementation of the African Continental Free Trade Area and the Digital Transformation Strategy for Africa. Ambassador Muchanga expressed the AUC’s gratitude to the African Development Bank for its support. He said: “Covid-19 underscored the importance of digital technologies and the digital economy as a whole, and in that regard, Africa should think big when it comes to digital development, digital economy and the grand opportunities on integration and economic growth.” Dr. Kamara said the project would support the implementation of the African Development Bank’s High 5 priorities as accelerators to achieve Agenda 2063 targets and the continent’s economic transformation to get The Africa We Want. He added: “It is important to create employment opportunities for millions of young Africans, which is essential for the stability and prosperity of the continent.
The digital transformation of economies offers new opportunities to increase intra-Africa trade and boost economic growth.”
The right of African countries to use their natural gas reserves should be reflected in any deal at the COP27 climate talks, the President of the African Development Bank told Reuters, even as some nations push to see the use of the fuel curtailed.
Agreeing to a deal on fossil fuels is among the key sticking points at the talks, with some countries including India keen to phase down the use of all such fuels, including gas, sources said.
A preliminary document from the conference hosts arrived late last Monday and made no mention of fossil fuels. While it forms the basis of any agreement, the all-important final wording has yet to be hammered out.
“Africa must have natural gas to complement its renewable energy,” African Development Bank President, Akinwumi Adesina said on the sidelines of the U.N. conference, being held in Sharm el-Sheikh, Egypt.
“Africa Will Shape the Future,” Says Biden’s Advisor (Liberian Daily Observer)
A senior advisor to US President Joe Biden says that the upcoming US-Africa summit is rooted in the recognition that Africa is a key geopolitical player, one that is shaping the present and will shape the future. The statement comes from Dana Banks, who works in the Biden administration as Special Assistant to the President and Senior Director for Africa at the National Security Council.
According to her, Biden believes that US collaboration with African leaders is essential to tackling shared challenges while seizing opportunities, including increasing sustainable food production; strengthening health systems, and combating the COVID-19 pandemic.
“With one of the world’s fastest-growing populations, largest free trade area, most diverse ecosystems, and one of the largest regional voting groups in the United Nations, African contributions, partnerships, and leadership are essential to meeting this era’s defining challenges,” said Banks who is in charge of the second US-Africa Leaders Summit in Washington, scheduled for mid-December.
“The continent’s dynamic economies and populations really do provide the foundation for a bright future for the continent and the United States. Whether it’s recovering from the pandemic and strengthening health systems, creating broad-based economic opportunity, or addressing the climate crisis. expanding energy access, revitalizing democracies, or strengthening the free and open international order.”
The International Monetary Fund (IMF) has said the growing crypto market in Nigeria and other Africa countries needs better regulations. “The collapse of the world’s third largest crypto exchange FTX, and subsequent plunge in the prices of Bitcoin, Ethereum, and other major crypto assets, is prompting renewed calls for greater consumer protection and regulation of the crypto industry,” it said in a new blog on Tuesday.
Finder’s latest report on cryptocurrency ownership and adoption shows that Nigeria has the second-highest number of Bitcoin owners as of October at 48 percent, up from 16.1 percent in the same month last year. Australia sits atop the table, with 61 percent of crypto owners holding Bitcoin, the world’s most popular cryptocurrency. In August, Nigeria emerged as the most crypto-obsessed nation in the world based on the increasing number of Nigerians searching the Internet for crypto-related trading, according to CoinGecko, a crypto price tracker.
The IMF said regulating a highly volatile and decentralized system remains a challenge for most governments, requiring a balance between minimising risk and maximising innovation.
“Only one-quarter of countries in sub-Saharan Africa formally regulate crypto. However, two-thirds have implemented some restrictions and six countries — Cameroon, Ethiopia, Lesotho, Sierra Leone, Tanzania, and the Republic of Congo — have banned crypto,” it said.
The CFA Franc reform being demanded since 2019 concerns the current mechanisms for monetary cooperation with France. Last November 17-18, a symposium was held in Libreville, Gabon, on the theme “Currency and Development in Central Africa.” During the symposium, university professors, economists, and other civil society actors from the CEMAC zone mostly supported deep reforms of the CFA Franc.
For the economist, at the time the CFA Franc was adopted, France was the major trade partner of CEMAC countries (Cameroon, Central African Republic, Congo, Gabon, Equatorial Guinea, and Chad). Nowadays, however, the list has changed with the CEMAC region’s trade with countries like China and other Asian countries growing significantly in recent years, as Nouveau Gabon reports.
“Reserves are used to facilitate trade with foreign countries. So, if we have reserves in the Chinese currency, in US dollars, in Euro... I think we would have a more flexible policy for trade with foreign partners,” he added.
The participants at the symposium believed that reforming the CFA Franc would not be enough to boost the development of the CEMAC region. “…whatever the name or the monetary reform implemented, if they are not backed by public action and economic reforms, it would not help us achieve the development we all wish for. So, another set of reform is needed alongside the monetary reform,” said Professor Alain Kenmogne Simo. Geoffroy Foumboula Libeka, a member of Copil Citoyen, a Gabonese civil society, added that “the most important thing is not to change the currency.” “As long as there is no discipline in budget management or there are no sanctions punishing misappropriation of public funds, we can change as many currencies as we want, we can give any name we wish to those currencies but nothing will change. Good governance is the priority,” he said.
Patterson urges Africa-Caricom trade deal (Jamaica Gleaner)
Former Prime Minister P.J. Patterson has called on the leaders of African and Caribbean nations to fashion and ink a free trade agreement that would economically link the countries of the continent with those of the Caribbean subregion. Specifically, Patterson, who for many years had lead responsibility for trade issues for the 15-member Caribbean Community, Caricom, wants the regional trade bloc to take the lead in forging greater economic and financial ties with the ancestral motherland of the majority of the population of member countries of the integration movement, through a possible deal with the African Continental Free Trade Area, AfCFTA, which is being forged by African leaders.
“The linking of Caricom and AfCFTA would provide mutual economic benefits for African and Caribbean countries and also strengthen the cultural and historical bonds between them. A dynamic Trade Agreement would provide access to a huge market for Caribbean countries and also give African countries access to expertise in certain sectors where Caribbean countries have an advantage such as tourism. It would also strengthen their negotiating positions in the WTO (World Trade Organization) and other multilateral fora,” Patterson told the virtual conference.
Patterson reasoned that the time is opportune for ramping up Africa-Caribbean trade in the context of the negative effects of the COVID-19 pandemic on the economies of the African continent and the Caribbean region.
The Africa-Caribbean trade arrangement he contends, should involve the progressive removal of trade barriers by national governments based on feedback from businesses, and improvements in air and sea transport, trade in tourism, entertainment, culture and other services. Such an arrangement, he argued, would lead to more equitable trade and economic growth in the developing countries of Africa and the Caribbean.
He pointed to what he described as the untapped potential of trade by internet to overcome constraints of transport and infrastructure. He is recommending too, more two-way flow of business and financial services, policy consultancy and exchanges in arts and culture.
Consumers have the right to safe products but this right is constantly under threat. In the European Union alone, unsafe products cause accidents and losses estimated at $34.4 billion per year, according to the European Commission. This trend, though less reported, is replicated in the developing world.
“Civil society plays a key role in raising awareness among consumers and in signaling dangerous products in markets,” said Teresa Moreira, head of competition and consumer policies at UNCTAD, during a joint European Commission – UNCTAD workshop on product safety on 17 November. “National governments need to empower consumer groups to fulfil their mandate in ensuring product safety,” she added.
The UN Climate Change Conference, COP27 may come to be remembered for missed opportunities. For example, to progress commitments to limit temperature rise of 1.5C degrees; or strengthen language on reduction of fossil fuels use; or address the gap in adaptation efforts. But COP27 should also be deservingly remembered for its agreement on a historic “loss and damage” fund for climate impact in developing countries. The hard-won deal is a turning point in acknowledging the vast inequities of the climate crisis. For the first time in 30 years of climate talks, developed countries will provide finance towards recovery and rebuilding of poorer countries stricken by climate-related disasters. In the initial flurry, more than US$300 million has been pledged by European nations.
The fund will support the most vulnerable countries and severely impacted middle-income countries can apply for aid too. A transitional committee with members from 24 countries will make recommendations for countries to adopt at the COP28 summit in November 2023. Now comes the difficult part; the fund must be set up and financed. Institutional arrangements and governance still must be detailed; new sources of funding identified and expanded. The following five steps are critical
LDCs need to be rewarded for their low emissions through better trade deals (Trade for Development News)
Bhutan has a vulnerable and fragile mountain ecosystem. It has made a conscious decision to maintain 60% of its territory covered by forests and enshrine this commitment in its constitution. Currently forests cover over 72% of its territory.
Like most least developed countries (LDCs), Bhutan’s export basket is at the lower end of value and largely includes primary or semi-processed goods. Our major exports are hydroelectricity, non-ferrous metals, minerals, cement and boulders. Our imports are finished goods or intermediaries of higher value such as fuel, machinery, rice, and vehicles.
Bhutan and other LDCs face numerous constraints and challenges to trade. We suffer from a lack of trade facilitation infrastructure - both soft and hard components; technical barriers to trade (TBT) and sanitary and phytosanitary (SPS) measures used as non-tariff measures; trade finance; supply side constraints; and limited market access to name a few.
In addition to these trade challenges, Bhutan is also on the frontline in terms of adverse impacts of climate change. We are increasingly suffering extreme weather events such as floods, landslides, glacial lake outburst floods, forest fires, windstorms and melting glaciers. As a result, Bhutan is struggling to finance adaptation and build resilience to climate change.
Tapping into the economic development opportunities that trade offers could help LDCs and Bhutan finance climate-resilient economies. An option could be to make carbon neutral exports earn a premium over carbon-intensive exports from countries. This could help reduce the challenges of imported emissions in major markets and contribute to raising global climate ambition.
Net zero trade offers a potential to turn the historic disadvantage of low industrialization and low levels of pollution into a trade and climate advantage. Unfortunately, there are still capacity and regulatory barriers to this endeavour. Overall, there must be increased and enhanced efforts from the developed countries to support trade with LDCs.
UN to vote on new tax convention proposed by African states (The Guardian)
Developing nations are hoping to secure greater power over global tax affairs at a critical United Nations vote in New York on Wednesday. If the body’s members vote in favour of a resolution put forward by the African Group of states, it could pave the way toward fresh intergovernmental talks on global tax policy. The draft resolution calls on members to decide to lay the groundwork for a new UN convention on tax.
This could shift clout from bodies traditionally dominated by rich countries, such as the Organisation for Economic Co-operation and Development (OECD), towards the UN, where developing nations have a greater say, campaigners claim.
Proposed by the group that represents the 54 African Union member states at the UN, the resolution would give the New York-based body the mandate “to monitor, evaluate and decide global tax rules”, the Tax Justice Network (TJN) said. This will “open the way for intergovernmental discussions on the negotiation of a UN tax convention and a global tax body”, said Alex Cobham, chief executive at the TJN.
However, there has been considerable opposition from some developed nations. Rich western countries have long fought diplomatic battles over which forum should hold sway over countries’ tax affairs.
ECA in collaboration with UNCTAD and other Regional Commissions including ESCAP and ECLAC have been implementing project activities through a DA project aimed at enabling UN member countries to diagnose their fragilities in the global and regional context and identify and design appropriate policy responses leading toward recovery and return to the development path.
Globally, the digital economy has been booming – a trend that COVID-19 sped up as more people and businesses went online. E-commerce sales worldwide, for example, grew 4% in 2019 to hit an estimated $26.7 trillion. And the latest UNCTAD data shows the pandemic’s boost was sustained in 2021. But some countries are less ready than others to take advantage of all the opportunities. So UNCTAD conducts eTrade readiness assessments to help them harness the power of the digital transformation to create better business opportunities, jobs and living conditions for all. Here are five things to know about the assessments.