Building capacity to help Africa trade better

tralac Daily News


tralac Daily News

tralac Daily News

Buying local critical to economic growth - DP Mashatile (SAnews)

Deputy President Paul Mashatile says buying locally made products and supporting the small businesses which produce them can lead to much needed boost in local economies and stimulate national economic growth.

The Deputy President was addressing the Localisation Gala Dinner of Proudly South African’s Buy Local Summit and Expo held in Sandton on Tuesday.

“This is because every local transaction has a ripple effect that extends beyond our comprehension. By purchasing locally produced food and other goods, consumers support their local economy, families, communities, and promote the culture of entrepreneurship.

“Moreover, supporting local businesses can stimulate the local economy, since it redirects funds back into the community rather than into the coffers of ambiguous national chains and corporations,” he said.

“We cannot have economic growth without localisation. [A] study commissioned by Proudly SA and done by Dr Iraj Abedian’s PAIRS outfit, confirms the link between localisation and economic growth and the different steps that the private and public sectors need to take in this area.

“Some of the most important things in the report are the positive effects of domestic manufacturing investment on the GDP, fiscal revenue, real wages, and consumer inflation. Moreover, the report showed that the SA economy could benefit from an increase of just 10 percent in investment spending in the manufacturing sector,” he said.

Report highlights costs of South Africa’s ‘opaque and lethargic’ tariff investigations (Engineering News)

A new report into ongoing tariff investigations in South Africa indicates that it is taking an average of 22 months to finalise decisions on whether to either increase or remove an import duty, weakening the effectiveness of trade policy to either protect domestic producers or lower costs for consumers.

Compiled by XA Global Trade Advisors, the report states that 90% of the 39 cases that had been lodged with the International Trade Administration Commission of South Africa (Itac) by December 31 last year were overdue when measured against the six-month timeframe recommended by the Department of Trade, Industry and Competition (DTIC) for the resolution of such probes.

CEO Donald MacKay notes that 22 of those cases, representing 56% of all open cases, were overdue by more than 19 months, with two cases more than 43 months overdue.

“It is impossible to manage trade in such a lethargic system. What applied in 2019 is very different to the real-world scenario in 2023 and trade decisions need to be based on the now, not the past,” MacKay asserts.

Kenya re-opens its doors for return of Uganda’s Lato milk (The East African)

Kenya has allowed Uganda’s Lato milk to invest in local dairy factories as the state ramps up competition in the dairy sector which government officials have constantly complained is dominated by one player.

Trade and Investments Cabinet Secretary Moses Kuria Tuesday held bilateral talks with Uganda’s Treasury Permanent Secretary Ramadan Ggoobi where the two countries promised to work together to boost their respective dairy sectors.

The ministry said that Lato, a leading milk processor in Uganda which had significantly penetrated the Kenyan market, has signed a deal with the state-owned financier Kenya Development Corporation (KDC) to invest jointly in dairy ventures.

“The meeting focused on mutual economic and investment objectives by the two countries as a follow-up to the various bilateral meetings between to facilitate regional co-investment opportunities in strategic sectors,” said Mr Kuria.

He said Lato will invest in Kenyan milk factories that are currently struggling in a bid to revive them in what will see the Ugandan firm take the fight for control of the lucrative milk sector to the doorstep of some well-known local dairy brands.

Kenya’s trade surplus with Africa up fastest in 6 years (Business Daily)

Kenya’s trade surplus with Africa has risen at the fastest pace in six years, boosting the government’s renewed push for the integration of trading blocs on the continent. The gap between exports and imports widened to Sh88.3 billion last year from Sh80.49 billion the year before, marking the highest value since 2016 when it hit Sh94.41 billion.

Provisional data by the Central Bank of Kenya shows that traders earned Sh355.43 billion from exports to African countries in 2022 against an expenditure of Sh267.13 billion.

This has come at a time President William Ruto has directed Trade Cabinet Secretary Moses Kuria to take a proactive role in lobbying countries in eastern, central and southern Africa to sign and ratify a proposed tripartite agreement.

Steps to establish Ghana’s Integrated Aluminium Industry on course – Lands Minister (MyJoyOnline.com)

The Minister for Lands and Natural Resources, Samuel A. Jinapor, says Government’s quest to build an integrated aluminium industry in the country is on course and progressing steadily.

He said this is in line with the Ghana Integrated Aluminium Development Corporation Act, 2018 (Act 976), which establishes the Ghana Integrated Aluminium Development Corporation (GIADEC) to promote and develop an integrated aluminium industry in the country.

The Minister said this on Wednesday, 29th March, 2023, when he opened a two-day Workshop on the downstream aluminium industry in Akosombo in the Eastern Region.

The workshop brought together stakeholders in the aluminium industry to deliberate on policy options and implementation plan for the downstream aluminium industry. This follows an extensive research, data collection and technical analysis of best practices across the world carried out by GIADEC and ODI.

Delivering the keynote address at the workshop, Mr. Jinapor emphasised the need to add value to Ghana’s mineral resources to ensure optimal benefit from these resources.He said Government has since 2017 been pursuing this path for all our mineral resources including gold, bauxite, iron ore, lithium and other green minerals.

174 MSMEs Benefit From EU’s PPEs Production Project (Leadership News)

174 Nigerian Micro Small and Medium Enterprises (MSMEs) have been empowered after three years of implementing the European Union funded facility to produce high quality Personal Protective Equipment (PPEs) and health-care related products.

The empowerment programme which was birthed in response to Covid-19 containment measures, aimed to strengthen the capacity of selected local MSMEs/manufacturers across the six geo-political zones to upgrade production processes and adopt World Health Organisation (WHO) standards and technical regulations to meet local demand and export to ECOWAS sub region.

Implemented by four United Nations agencies of Industrial Development Organisation (UNIDO), International Labour Organisation (ILO), UN Women, the WHO, the beneficiaries were assisted and trained in intervention areas of quality management and SOPs, business linkage, production and equipment management, strategic marketing and business planning.

Egypt secures $2.6 bln in development finances for private sector in 2022 (Ahram Online)

The Ministry of International Cooperation noted that the ministry is working on updating and developing strategies for international cooperation and development financing with many development partners for the next three to five years.

The report shows that The OPEC Fund for International Development was the top institution that provided this amount, with a value of $1.21 billion.

The European Bank of Reconstruction and Development (EBRD) followed with $558 million, while the International Finance Corporation (IFC) provided $233 million.

Egypt is currently adopting the State Ownership Policy that charts a map of increasing the private sector share in the local economic activity to 65 percent, up from 30 percent.

Moreover, Egypt has made a clear commitment – under its $3 billion loan deal with the International Monetary Fund – to unlock the potential of the private sector through expanding in state-owned assets sales whether under the government’s IPO programme or through offering them to strategic investors.

Tripartite Council of Ministers Adopt Legal Instruments to Implement the Tripartite Free Trade Area (COMESA)

The Council of Ministers of the Common Market for Eastern and Southern Africa (COMESA), East African Community (EAC) and the Southern African Development Community (SADC) have adopted legal instruments to implement the Tripartite Free Trade Agreement (TFTA) once it enters into force.

In its 5th meeting conducted virtually today, the Ministers adopted six instruments relating to trade and customs, namely the tripartite agreement on movement of businesspersons, annexes on elimination of import duties, trade remedies, rules of origin, dispute settlement mechanism and the TFTA protocol on competition policy.

Further the Council adopted the guidelines, manuals and working procedures developed on rules of origin and technical barriers to trade, which comprise of sanitary and phytosanitary matters and non-tariff barriers.

With the adoption of these trade and transport facilitation instruments, focus now is on the ratification of the TFTA, which is currently short of three Member/Partner States signatures to achieve the 14 threshold to enable it enter into force.

Currently, 22 Tripartite Member/Partner States have signed the Agreement out of which, 11, including, Egypt, Uganda, Kenya, South Africa, Rwanda, Burundi, Botswana, Namibia, Eswatini, Zambia and Zimbabwe have ratified it.

Burundi President officially opens the 3rd Meeting of the 1st Session of the 5th EALA in Bujumbura (EAC)

The Heads of the East African Community (EAC) Organs and Institutions must work hard to address factors that limit or constrain the construction of a larger EAC internal market in order to increase its share in global trade and economy.

This was said by His Excellency Evariste Ndayishimiye, the President of the Republic of Burundi and Chairperson, EAC Heads of Summit, while presiding over the official opening of the 3rd Meeting of the 1st Session of the 5th East African Legislative Assembly (EALA) at the National Assembly Buildings in Bujumbura, Burundi.

While taking note of the low rated visibility of the EAC in the region, the Head of State tasked Members of the EALA to take time to sensitize East Africans, members of the private sector and the civil society regarding the achievements that have so far been made towards achieving the pillars of integration which are the Customs Union, Common Market, the Monetary Union and other steps that will be undertaken to attain political federation.

Powering trade through AfCFTA: A People-driven wholesome development agenda (The East African)

By eliminating barriers to trade in Africa, the African Continental Free Trade Area (AfCFTA) will lift 30 million people from extreme poverty and another 68 million people from moderate poverty.

The successful implementation of the AfCFTA will lead to the creation of more decent jobs, improved welfare and better quality of life for all citizenry, and sustainable development. Beyond the policy transformation and reforms, the AfCFTA seeks to ensure inclusivity of women and youth, including youth in the rural areas, development of small and medium enterprises (SMEs) and overall industrialisation of the Continent.

As at February 2022, eight countries representing the five regions of the continent - Cameroon, Egypt, Ghana, Kenya, Mauritius, Rwanda, Tanzania and Tunisia – participated in the AfCFTA’s Guided Trade Initiative, which seeks to facilitate trade among interested AfCFTA state parties that have met the minimum requirements for trade, under the Agreement. This initiative supports matchmaking businesses and products for export and import between State Parties. The products earmarked to trade under the Initiative include: ceramic tiles; batteries, tea, coffee, processed meat products, corn starch, sugar, pasta, glucose syrup, dried fruits, and sisal fibre, amongst others, in line with the AfCFTA focus on value chain development.

In the year 2023, the AfCFTA Guided Trade shall also focus on Trade in Services in the five priority areas, i.e. Tourism, transport, Business Services; Communication Services, Financial Services, Transport Services, and Tourism and Travel-related Services. The ultimate objective is to ensure that AfCFTA is truly operational and the gains from the initiative are improved implementation in order to achieve increased inter-regional and intra-Africa trade that would yield economic development for the betterment of the continent at large.

The adoption by the African Union of the theme of the Year 2023 as the “Year of AfCFTA: Acceleration of the African Continental Free Trade Area Implementation”, is expected to generate greater political commitment and accelerate the effective implementation of the AfCFTA to fully benefit the African citizenry and achieve the Aspirations and goals of Agenda 2063.

Uganda has lowest share of commercial debt in EAC (Monitor)

Uganda holds the least share of commercial debt in East Africa, according to the Ministry of Finance Status of Uganda’s Debt report.

The report, which highlights different aspects of Uganda’s financing, including sustainability, stock and source of public debt indicates that whereas the share of Uganda’s commercial debt as opposed to bilateral and multilateral debt has been growing, it remains lower compared to other East African member states.

According to the report, during the period ended September 2022, out of $20.33b (Shs76.5 trillion) total stock of public debt, the share of commercial debt stood at 10.4 percent, which was lower than any other East African member state.

Tanzania holds the largest share of commercial debt at 31.8 percent, followed by Kenya, which holds 26.6 percent of its public debt in commercial loans. Rwanda, at 13 percent, is comparably lower than the two countries but higher than Uganda.

However, data indicates that all East African member states have been reducing their share of credit from multilateral and bilateral lenders while increasingly drawing more loans from expensive credit sources such as commercial banks.

Free movement of people, a catalyst for trade (UNECA)

African countries should promote the free movement of people across their borders to boost intra-African trade, says the Economic Commission for Africa (ECA), Director of Regional Integration and Trade Division, Stephen Karingi, calling for the speedy ratification of the Protocol on free movement of people.

The African Union, recognizing the importance of human resource skills to the continent’s development, adopted the Free Movement of Persons Protocol in 2018, which has been signed by 33 Member States. However, only four countries have ratified the Protocol to date.

“The state of ratification is disheartening, to say the least, given that the Protocol is aimed at facilitating regional integration in general, and the implementation of the African Continental Free Trade Area (AfCFTA), in particular,” Mr. Karingi said in Nairobi, Kenya during the Experts’ Group Meeting to Review the Policy Report on the theme; “The Free Movement of Persons for Trade: Towards an Accelerated Ratification of the AU Free Movement of Persons Protocol in Support of the implementation of the AfCFTA”.

The slow ratification of the Protocol has been attributed to a lack of knowledge and appreciation of the benefits of free movement of persons, lack of awareness of the Protocol, lack of political will, security and health concerns. Furthermore, the study recommended spirited advocacy and sensitization campaigns targeting member states and civil society to initiate domestic processes for ratifying the Protocol.

ECA and RES4Africa Foundation identify key steps to advance Africa’s electricity sector reform agenda, in a dedicated Public-Private Dialogue (UNECA)

In the framework of support from the Italian Ministry of Foreign Affairs and International Cooperation to Advancing the electricity reform agenda by enhancing public-private dialogue, the United Nations Economic Commission for Africa (ECA) and the RES4Africa Foundation hosted the High-Level Public-Private Dialogue on Private Sector Investment in Electricity and Infrastructure Development in Africa.

The event brought together stakeholders from the public and private sectors, including policymakers, international organizations, and decision-makers working in energy and infrastructure. The participants discussed the changes needed in policy and regulatory frameworks to ensure adequate openness, attractiveness, and readiness of African markets to private investments.

Acting ECA Executive Secretary Antonio Pedro, stressed that the policy and regulatory challenges will require putting in place the kind of infrastructure that can support growth and prosperity. “Investments in energy and infrastructure will help leverage the opportunities for economic diversification through increased intra-African trade and regional economic integration and provide economic opportunities for the growing African youth and its vibrant population,” he said. “These investments will help us close the existing energy access gap. Currently, more than 600 million of our people do not have access to electricity and we generate only 4% of the global energy - this has to change,” he added.

Fact Sheet: Vice President Harris Launches Global Initiatives on the Economic Empowerment of Women, Totaling over $1 Billion (The White House)

Promoting gender equity and equality is a cornerstone of U.S. foreign policy in Africa and around the world. Advancing the economic status of women and girls is not only a matter of human rights, justice, and fairness—it is also a strategic imperative that reduces poverty and promotes sustainable economic growth, increases access to education, improves health outcomes, advances political stability, and fosters democracy.

In particular, the digital gender gap undermines women’s full participation in the 21st century economy. Globally, approximately 260 million more men than women were using the internet in 2022—and this gap has increased by 20 million in the last three years. The gap is especially acute across Africa, where International Telecommunication Union data show that sixty-six percent of women do not use the internet.

To address this disparity, the Biden-Harris Administration will continue to work with other governments, private sector, foundations, and multilateral organizations to help close the digital divide, improve meaningful access to equitable digital finance and other online services, and address social norms that prevent women from participating fully in the digital economy. More broadly, the Biden-Harris Administration will continue to promote the economic empowerment of women.

Near East and North Africa Regional Overview of Food Security and Nutrition 2023: Trade as enabler for food security and nutrition (ReliefWeb)

Hunger and malnutrition have reached critical levels in the Arab region as access to basic foods has been affected by the COVID-19 pandemic and the war in Ukraine, according to a United Nations report released today.

Produced by the Food and Agriculture Organization of the United Nations (FAO), the International Fund for Agriculture Development (IFAD),the World Food Programme (WFP), the World Health Organizations (WHO), the United Nations Children’s Fund (UNICEF), and the United Nations Economic and Social Commission for Western Asia (ESCWA), the 2022 Near East and North Africa Regional Overview of Food Security and Nutrition: Trade as an Enabler for Food Security and Nutrition, examines the state of regional food security, providing analysis and recommendations on how to mitigate the situation.

The report reveals that an estimated 53.9 million people suffered from severe food insecurity in the Arab region in 2021, accounting for a 55 percent increase since 2010. This is also an increase of 5 million people from the previous year. Moderate or severe food insecurity has also continued its upward trend, affecting an estimated 154.3 million people in 2021, an increase of 11.6 million people over the previous year, the report also warned.

While the Arab region was already off-track from achieving zero hunger and nutrition-related Sustainable Development Goal (SDG) targets, the pandemic and the war in Ukraine have exacerbated the situation by creating disruptions in supply chains and inflating the prices of grains, fertilizers and energy. Since the region depends heavily on imported food to meet its food security requirements, these crises have affected Arab countries disproportionately and aggravated food insecurity and malnutrition in the region.

The Overview highlights that trade is an essential enabler to ensure all four dimensions of food security and nutrition (availability, access, utilization, and stability) by increasing the quantity and variety of food and decreasing its price for net-food importing countries. However, most of the countries in the region have not mainstreamed trade into food security policies; thus, relevant policies must be redesigned accordingly and agrifood systems in the area must be transformed to make them more efficient, inclusive, resilient and sustainable.

The long hangover of the ‘Ever Given’ global trade disruption (EL PAÍS)

The Ever Given is 1,300 feet (400 meters) long and 193 feet (59 meters) wide. New York’s Empire State Building is shorter at 1,250 feet (382 meters). Two years ago, photos of the Ever Given grounded for six days in the Suez Canal made all the TV news reports and front pages. The incident dispelled any notions about the infallibility of globalization after a single blockage of a major commercial artery was enough to cause worldwide supply problems. “It was like a beached whale,” said Peter Berdowski, CEO of Boskalis, the company that owns SMIT, the Dutch salvage company that played a crucial role in the effort to refloat the mega-ship.

Two years after its all-out effort to free the ship from the Egyptian mud, Boskalis is still in litigation in the London courts against Shoei Kisen Kaisha, the Japanese company that owns the Ever Given. Boskalis claims it’s owed more money and is not the only one. Danish shipping giant Maersk claims it’s owed $43 million (€40 million) for losses incurred while its container ships were stuck for days waiting to pass through the Suez Canal. At one point, 372 ships were anchored on both ends of a canal that handles more than 10% of global maritime trade.

Between 80-90% of the world’s goods are transported by sea. It’s probably one of the most unknown and underappreciated cogs in the global economy because it works in distant oceans, far from the thoughts and lives of ordinary people. But globalization would be very different without it. Maritime transport is far cheaper than air transport, so it helps maintain low prices for consumers. When the Ever Given blocked the massive flow of goods to and from Europe, the Middle East and Asia through the Suez Canal, everyone knew about it. The numbers were staggering – some said losses amounted to $400 million per hour, $10 billion daily.

Emilio de la Cruz, Maerk’s managing director for Western Europe and the Maghreb region, says that the pandemic and the Ever Given incident have driven changes in global trade. “Resilience and flexibility are being built into supply chains as reinforcement, even if that comes at a cost. It’s a ‘just in case’ approach rather than ‘just in time and as cheaply as possible.’ The trend is to reduce the number of logistics providers to achieve better and quicker responses to disruptions,” he said. The Suez Canal Authority has not been idle either. To avoid another Ever Given nightmare, it has been working for over 18 months on deepening the southern section of the waterway and lengthening the parallel canal built in 2014.

UN Releases Draft Programme for HLPF 2023 (IISD)

The UN Secretariat has released the draft programme for the July 2023 session of the UN High-level Political Forum on Sustainable Development (HLPF). The annual meeting is held under the auspices of the UN Economic and Social Council (ECOSOC). Its 2023 edition will serve as a key preparatory event for the SDG Summit in September and help “identify substantive priorities and generate political momentum” for the Summit.

The theme of HLPF 2023 is ‘Accelerating the recovery from the coronavirus disease (COVID-19) and the full implementation of the 2030 Agenda for Sustainable Development at all levels.’ It is scheduled to take place from 10-14 July and 17-19 July at UN Headquarters in New York, US, followed by the last day of the ECOSOC high-level segment on 20 July.

ECOSOC President Lachezara Stoeva notes that 2023 marks “the mid-point of the implementation of the 2030 Agenda for Sustainable Development.” She further notes that the second SDG Summit – the HLPF held under the auspices of the UN General Assembly (UNGA) every four years – will convene during the 2023 UNGA high-level week, bringing together Heads of State and Government. The Summit will “carry out a comprehensive review of the state of the SDGs, respond to the impact of the multiple and interlocking crises facing the world, and provide political guidance on transformative and accelerated actions to achieve the goals by 2030,” the ECOSOC President writes.

O’Neill urges Brics bloc to expand, challenge dollar’s dominance (Engineering News)

Jim O’Neill, the former Goldman Sachs Group chief economist who coined the acronym Bric, said the bloc of nations that later adopted the name should expand and work to counter the dollar’s dominance.

In a paper published in the Global Policy journal on March 26, O’Neill called on the group to apply strict criteria to ensure the addition of any new members to its ranks helps further its aims and urged it to focus on climate finance, improving healthcare and boosting trade.

Brazil, Russia, India and China established Bric in 2009 and the bloc became Brics a year later when South Africa was admitted. If it expands to include other “emerging nations with persistent surpluses,” a globally fairer, multi-currency global system could emerge, O’Neill said.

DDG Ellard: The future of globalization is services, digital technology (WTO)

What springs to your mind when you think about international trade? Is it the nuts and bolts of trade, such as large container ships at the port of Shanghai, Los Angeles, or Rotterdam? Or is it trade disputes, such as US – Steel and Aluminium, US – Washers, or the Large Civil Aircraft disputes, which all concern trade in goods? Or maybe it’s semiconductor chips, which preoccupy many policymakers these days?

Those are all good answers. But international trade today is increasingly more about intangibles – things that we cannot see or touch, but which represent a major share of GDP in many countries. For example, in 2021, almost 78% of the U.S. GDP was generated by services.

In 2021, global services exports were valued at US$6 trillion, representing just over one-fifth of total world trade in both goods and services, and we estimate that the share of services in world trade could reach one-third by 2040. And this is not even the full picture because it does not account for all the different ways in which services may be traded. For example, Mode 3, commercial presence, is not included in this estimate.

DDG González to business: “Rise to the moment to help strengthen rules-based trade” (WTO)

DDG González noted that global merchandise trade has been at record highs since early 2021, and that even with the war in Ukraine, trade has performed a lot better than expected. “But this overall positive picture of trade should not obscure the many forces tugging hard at the seams of the rules-based trading system, from the rise of geopolitical tensions and great power rivalry to the revival of trade-restrictive industrial policies and worrying subsidy races,” she said.

Members maintain focus on food security, discuss farm policies, transparency (WTO)

Members continued to review each other’s farm support and border policies to ensure conformity with WTO regulations. They also discussed the implementation of ministerial outcomes adopted at the ministerial conferences in Bali and Nairobi and the 12th Ministerial Conference (MC12) in Geneva in June 2022. Members agreed to defer the finalization of the first triennial review of the Bali Tariff Rate Quota (TRQ) Decision to the next committee meeting scheduled for 27-28 June 2023.

Global Gas Flaring Falls to Lowest Level Since 2010 (World Bank)

Progress in reducing gas flaring resumed in 2022, with gas flared worldwide falling by 5 billion cubic meters (bcm) to 139 bcm, its lowest level since 2010, according to new satellite data compiled by the World Bank’s Global Gas Flaring Reduction Partnership (GGFR).

“After a decade of stalled progress, global gas flaring volumes fell in 2022 by around three percent, which is a welcome drop, especially during a time of concern about energy security for many countries. We continue to encourage all oil producers to seize opportunities to end this polluting and wasteful practice,” said Guangzhe Chen, World Bank Vice President for Infrastructure.

Three countries, Nigeria, Mexico, and the United States, accounted for most of the decline in global gas flaring in 2022. Two other countries—Kazakhstan and Colombia— stand out for consistently reducing flaring volumes in the last seven years.


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