tralac Daily News
Anti-money laundering, climate financing and sovereign debt resolution in Africa are expected to top the agenda when Finance Minister, Enoch Godongwana, engages United States Secretary of Treasury, Janet Yellen, during a bilateral meeting on Thursday.
Addressing media ahead of the closed meeting today, Godongwana described the bilateral as a “momentous occasion”. He said there had been constructive cooperation between the two countries through the G20 and the Financial Stability Board, including making appropriate regulatory standards for the financial sector. “There has also been broader cooperation between the US and the African region,” said the Minister.
“The USA ranks among South Africa’s top trading partners with a diverse flow of goods, services and knowhow between the two States, serving as a critical launch pad for the development of both economies. My hope is that this may continue,” said Godongwana.
The federal government has initiated moves to reform the automobile industry to attract companies to invest in the country.
Speaking during a stakeholder consultative yesterday, the Permanent Secretary of the Ministry of Finance, Budget and National Planning (FMFBNP), Engr. Nebeolisa Anako, said the increasing rate of relocation of manufacturing companies from Nigeria to neighboring countries such as Ghana, Benin Republic, among others due to the high cost of doing business is worrisome.
“In order for us to benefit maximally from the Industry, especially in view of the African Continental Free Trade Area (AfCFTA) window, there is a need for experts and stakeholders in the industry to deliberate, identify, and fashion out a roadmap that will enable government addresses the specific issues affecting the Industry.
“The sector needs to be revived to increase its contributions to the National development as well as the Gross Domestic Product (GDP). The crucial role of the Automobile Industry in the development of Nigeria’s economy cannot be over-emphasized.
African political and business leaders gathered in Ghana’s capital Accra on Thursday for a summit on the continent’s prosperity agenda. Dubbed the “Africa Prosperity Dialogue Series” participants have been discussing how Africa can achieve deeper economic integration between different states. Ghana is the host nation of the AfCFTA (The African Continental Free Trade Area) Secretariat, which is spearheading an agenda of reducing trade barriers on the continent.
The vice president of Ghana, Dr. Mahamadu Bawumia who spoke at the start of the summit said the continent must get serious in reducing poverty through what he called “smart investments.”
“As a continent, we need to produce and trade our way out of poverty and underdevelopment, and we cannot do that without investing in smart infrastructure across the continent,” he said.
The Ministers responsible for Transport and Corridor Development from Angola, Democratic Republic of Congo and Zambia with support and coordination of the Secretariat of the Southern African Development Community (SADC) will sign the Lobito Corridor Transit Transport Facilitation Agency (LCTTFA) Agreement at Lobito Port, Province of Benguela, Angola, on the 27th January 2023.
Lobito Corridor stretches from the Port of Lobito lying on the Atlantic Ocean, and passes through Angola from West to East through the Provinces of Benguela, Huambo, Bie’ and Moxico. It covers the mining areas of the Katanga Province of DRC and the Copperbelt of Zambia.
Lobito Corridor Transit Transport Facilitation Agency Agreement will accelerate growth in domestic and cross-border trade along the Corridor through the implementation of harmonised trade facilitation instruments, strengthening coordination of joint corridor development activities, and fostering effective participation of small and medium enterprises (SMEs) in value chains.
The signing of the corridor governance instrument will create a framework for the three SADC Member States to jointly develop harmonised corridor laws, policies, regulations and systems including infrastructure development in a coordinated and coherent manner aligned to the SADC Treaty, Protocols and development frameworks such as the Regional Indicative Strategic Development Plan 2020-2030, Regional Infrastructure Development Master Plan 2020-2027 and SADC Industrialization Strategy and Roadmap 2020-2063.
There is renewed momentum and willingness by COMESA-EAC-SADC Member States that are yet to ratify instruments of the Tripartite Free Trade Area (TFTA) to finalize internal consultations and join the eleven countries that have already signed the Agreement. Once 14 countries sign, the TFTA will be set into motion.
As Chair of the COMESA-EAC and SADC Tripartite Taskforce, COMESA has increased engagements with the remaining countries to ratify their instruments to join the TFTA.
“We are engaging and strategically approaching all the remaining member states who are yet to sign to do so as soon as possible so that by mid this year we can have the three or more remaining to bring the countries required to 14 for the Agreement to enter into force,” said Dr Christopher Onyango, the Director of Trade and Customs at COMESA Secretariat.
The proposed Tripartite Protocol on Competition Policy has been reviewed by the Tripartite Committee of Senior Trade Officials and will be recommended to the Tripartite Sectoral Ministerial Committee meeting for consideration before being submitted to the Council of Ministers for adoption.
The Protocol on Competition Policy does not provide for the creation of a Supra-national competition authority but is based on cooperation in the enforcement of competition and consumer protection matters by the Member/Partner States and Regional Economic Communities (RECs). It also guides Member/Partner States and RECs on the competition and consumer protection provisions that they should have at national and RECs level as well as to set up enforcement institutions.
Following the finalisation of the Protocol on Competition Policy, the Member/Partner States and the RECs are in the process of developing Regulations and Guidelines to guide the implementation its. Two meetings have since been held between September 2022 and January this year to discuss the Regulations and Guidelines.
African Development Bank Group plans to invest $10 billion over the next five years to boost Africa’s efforts to end hunger and become a primary food provider for itself and the rest of the world, Bank Group President, Dr Akinwumi Adesina, announced on Wednesday at the Dakar 2 Africa Food Summit in Diamniadio, east of the Senegalese capital of Dakar.
Adesina called on more than 34 heads of state, 70 government ministers, the private sector, farmers, development partners, and corporate executives to work out compacts that would deliver food and agriculture transformation at scale across Africa. He encouraged them to take collective action to unlock the continent’s agricultural potential to become a global breadbasket.
The Dakar 2 summit—under the theme Feed Africa: food sovereignty and resilience—takes place amid supply chain disruptions caused by the Covid-19 pandemic, climate change, Russia’s invasion of Ukraine.
Africa’s bilateral trade with China surged to a record high last year, highlighting how Beijing’s commercial influence over the continent continues to dwarf that of the U.S. Rising commodity prices and Beijing’s push to promote imports from Africa pushed trade up 11% to $282 billion in 2022. China’s exports to Africa were $164.49 billion, according to Chinese customs authorities, while imports reached $117.51 billion.
U.S. Treasury Secretary Janet Yellen watched Ford cars and pickup trucks being assembled at a plant in South Africa on Thursday, citing it as an example of cooperation between Washington and Africa as she begins the Biden administration’s big push to reengage with a continent that has 1.3 billion people and an abundance of economic potential.
“The United States’ strategy towards Africa is centered around a simple recognition that Africa will shape the future of the global economy,” Yellen said at the Ford plant in the suburb of Silverton in the South African capital, Pretoria.
“We know that a thriving Africa is in the interest of the United States. A thriving Africa means a large market for our goods and services. It means more investment opportunities for our businesses like this Ford plant, which can create jobs in Africa and customers for American businesses.”
The “world’s largest investment conference”, the Investing in African Mining Indaba, looks to entice investors to Cape Town’s International Convention Centre in hopes of righting “Africa’s myriad economies” following successive years of geopolitical shifts and economic disruptions, says international exhibition organiser Hyve Group’s Mining Indaba portfolio director Simon Ford.
This year’s theme – ‘Unlocking African Mining Investment: Stability, Security and Supply’ – speaks to the promise of African mining that sees recent changes “create pressure points and opportunities”, says Ford, noting that global economies are seeking security of supply for their energy transitions, as well as raw materials and precious metals to bolster their economic power.
“We would say that – in many reaches of Africa – the potential of mining is still untapped, and that there is significant opportunity for mining to attract capital and be transformative.” However, the global uncertainty and instability have yet to subside, with both the Russia-Ukraine conflict and the consequences of the Covid-19 pandemic lingering longer than many anticipated. There is also the niggling threat of a global recession.
The African Development Bank (AfDB) and the UN’s International Fund for Agricultural Development (IFAD) have signed a letter of intent in support of the pan-African Mission 1 for 200 (M1-200), a joint initiative to “reduce Africa’s food import dependency, and build sustainable, inclusive and climate-adapted food systems”.
“The current convergence of crises has exposed the underlying structural issues affecting agriculture and food systems,” said IFAD President Alvaro Lario. “Many countries in Africa need to find solutions now to avert more extreme consequences.”
In Africa, high fertiliser prices are hampering production in many low-income countries, while food supplies are impacted by the war in Ukraine and the effect of the climate crisis in many countries. The result has been an 8.5 percent rise in the cost of a typical food basket in Africa since 2020, according to data from the International Monetary Fund.
An African Development Bank Group team recently met with Swiss envoys working in West Africa to discuss Africa’s development agenda and energy access was highlighted as still being a big stumbling block to development.
Daniel Schroth, Director for Renewable Energy and Energy Efficiency, said Africa is not on track to meet United Nations’ Sustainable Development Goal number seven on universal energy access. He explained that as a result of the COVID-19 pandemic, for the first time in recent years the number of people without access to energy actually increased. He added that Africa’s lack of access to energy is slowing down the achievement of the other development goals.
“In view of the critical role of energy for development at large, the African Development Bank placed energy at the top of its agenda for the continent,” said Schroth.
Africa needs to adopt the Open Skies policy to improve air transport and in a united front, collaborate on the interconnectivity of the road networks to facilitate trade and movement of goods and services, EAC Secretary General has said.The East African Community Secretary (EAC) General Dr Peter Mathuki further called on the continent to deepen collaboration and address some of the issues hampering the region’s growth.
African countries have also been asked to provide investment incentives to businesses operating in the agribusiness, green and blue economy in order to reduce the soaring costs of basic foodstuffs coupled with rising inflation in Africa.
The shocks that have shaken the global economy in recent years have introduced a new normal for turbulence, driven in some cases by political fragmentation between countries. These episodes have also lifted uncertainty to exceptionally high levels, which in turn hurts economic growth as our research shows.
To better track the evolution of these conditions, we updated our World Uncertainty Index to show more frequent readings that are monthly, instead of quarterly, and incorporate data for 71 economies dating back to 2008.
A series of severe and mutually reinforcing shocks — the COVID-19 pandemic, the war in Ukraine and resulting food and energy crises, surging inflation, debt tightening, as well as the climate emergency — battered the world economy in 2022. Against this backdrop, world output growth is projected to decelerate from an estimated 3.0 per cent in 2022 to 1.9 per cent in 2023, marking one of the lowest growth rates in recent decades, according to the United Nations World Economic Situation and Prospects (WESP) 2023, launched today.
“This is not the time for short-term thinking or knee-jerk fiscal austerity that exacerbates inequality, increases suffering and could put the SDGs farther out of reach. These unprecedented times demand unprecedented action,” said António Guterres, United Nations Secretary-General. “This action