Building capacity to help Africa trade better

tralac Daily News


tralac Daily News

tralac Daily News

10% hike in SA trade exports, stats show (Bizcommunity)

South Africa recorded a trade surplus of R16.1bn in February 2023 compared to a deficit of R22.7bn in January 2023, and higher than the market forecast of a R14.3 bn shortfall.

This was the largest trade surplus over the last six months and came on the back of a 10.7% month-on-month increase in exports and a substantial decrease of 14.8% in imports. In line with expectations, the cumulative trade balance for the first two months of 2023 narrowed to a deficit of R6.6bn compared to a R17.1bn surplus over the same period in 2022.

South Africa once again recorded trade deficits with most of its regional trade partners, except Africa. With a substantial decline in imports from Africa for the period, the trade surplus with the continent rose to R30.5bn. This surplus is greatly beneficial to South Africa in that it increases the rand flow to the country, but also, the composition of the trade with the continent supports economic development in the country.

Other than oil and coal, most of the exports to Africa consist of higher value products, such as machinery, vehicles, and iron and steel. On the import side, products sourced from the continent are mostly lower value-added mining and mineral products such as oil, gold, and diamonds.

South African aeroplane company credits Brics with helping it win export orders (Engineering News)

South African light sports aircraft manufacturer Bat Hawk Aircraft has credited South Africa‘s membership of the Brics group as helping it win a major export order. Brics is the acronym for Brazil, Russia, India, China, and South Africa. The company is based in Nelspruit in Mpumalanga province.

“While our biggest aircraft importer in the continent is the Democratic Republic of Congo, followed by Botswana and Mozambique, we do export outside the continent as well,” explained Bat Hawk MD Terry Pappas. “We have footprints in the US and Australia. But our major breakthrough in the past five years has been with the Brics.”

Developing cybersecurity skills pipeline critical to fighting cybercrime (Engineering News)

Cybersecurity is one of the most significant risks facing South African companies and the government, as well as the world, with the World Economic Forum placing it among the top ten biggest threats faced by the world today.

However, the ability of the private and public sectors to respond adequately to the threat hinges on developing a cybersecurity skills pipeline, Council for Scientific and Industrial Research (CSIR) cybersecurity systems research group leader Billy Petzer said on April 4 at a cybersecurity media briefing in Pretoria.

An outlook of Tanzania’s Energy Demand, Supply and Cost by 2030 (AfDB)

The UN SDGs highlight the importance of energy indicators in achieving sustainable development. The supply side of energy in Tanzania has received a significant boost and there are optimistic targets to suggest further improvements in this area. However, past experiences have shown that the problems of financial constraints and the lack of technical capacities required could either delay or lead to the total abolishment of some projects. In the short- to medium-term, emphasising demand-side management (DSM) could prove crucial in ensuring a sustainable energy system in Tanzania but the evidence is sparse.

This study reviews the trends and underlying drivers of energy demand, supply, and cost in Tanzania. Total primary energy and electricity consumption exhibit a rising trend, and challenges on the supply side suggest energy deficit is a looming challenge in the future. Thus, without a significant boost in supply and probably DSM, unserved energy demand could worsen in the future. Key drivers include economic growth, price, electrification rate, population growth, industrialisation, changes in economic structure, and energy efficiency. Forecasted peak demand in the medium (2020-2025) and long term (2025-2030) would average annually 1274.74 MW and 1490.33 MW, respectively. Recent electricity tariffs in Tanzania are ranked among the highest in the sub-region, and the key drivers are own generation and transmission, and power purchase. The current tariff structure favours commercial consumers more than domestic consumers and this might impose significant affordability challenges on women who mostly do not operate in formal businesses. We discuss the implications of the findings.

Local manufacturers hail suspension of proposed excise duty hike (The Guardian Nigeria)

The inability of many Nigerians to access cash for daily activities is beginning to impact livelihoods and productivity in the real sector negatively, while pushing many businesses in the informal sector to the edge.

Factories are also experiencing a reduction in number of shifts and utilisation due to fewer workers and poor product sales at the retail end, while stakeholders in the informal sector have witnessed a decline in activities in the last few weeks.

CPPE chief executive officer, Dr. Muda Yusuf, noted that Nigerians continue to groan in the adversity inflicted by the acute cash shortage amid rejection of old currency notes by market operators, refusal by banks to accept old notes, silence by the Presidency on the Supreme Court judgment and absence of official pronouncement by CBN on the issue. He added that retail transactions across sectors have become nerve-wracking and distressing as payment system challenges persist. Yusuf, therefore, called on President Buhari to immediately intervene to put an end to the hardship caused by the currency redesign policy, adding that the cash scarcity has not only crippled economic activities in the country but has now become a major risk to the livelihoods of Nigerians.

The economy is gradually grinding to a halt because of the collapse of payment systems across all platforms. Digital platforms are performing sub-optimally because of congestion; physical cash is unavailable because the CBN has sucked away over 70 per cent of cash in the economy and the expected relief from the supreme court judgment has not materialised,” CPPE said.

President Ruto roots for carbon pricing to promote climate justice (Capital News)

President William Ruto has called for sustained efforts to enrich jurisprudence on environmental law in a bid to curtail further climate-related crises in Africa. Ruto who spoke on Monday while officially opening the 3rd Symposium on Greening Judiciaries in Africa challenged courts to widen their scope beyond human rights and constitutional affairs in a bid to secure climate justice.

“Greening our judiciaries will be inevitably multi-sectoral and inter-disciplinary. Beyond local and international human rights, constitutional, environmental, trade and economic law, our judiciaries must be exposed to diverse fields such as ecology, economics, agriculture, food systems, trade and finance, carbon markets, energy and infrastructure,” he told delegates at the conference.

Ruto termed pollution-dominated industrialization as unsustainable hence calling for concerted efforts to promote sustainable alternatives.

Meeting global EV targets will be ‘extremely challenging’ owing to raw material shortages (Engineering News)

Chemicals company BASF global precious metal services senior VP Timothy Ingle told delegates attending the Platinum Group Metals Day, in Johannesburg, earlier this week, that it would be extremely challenging from a raw materials perspective to meet the expected global uptake of ten-million electric vehicles (EVs) this year and the goal of reaching 40-million EVs on the road by 2030.

Ingle pointed to challenges faced globally with securing base metal supply and, in particular, lithium and class one nickel.

Concern over East Africa manufacturing slide (The Citizen)

Queries are being raised over the falling manufacturing value addition (MVA) in the East African Community (EAC) bloc. The trend fell short of the annual growth rate envisaged under the region’s industrialisation drive.

“We are not doing well in meeting the aspirations of the regional industrial policy targets,” said Mr Jean Baptiste Havugimana, the EAC director of productive sectors. According to him, MVA growth has slowed down in recent years. The growth rate fell from 5.3 percent between 2005 and 2010 to 4.6 percent between 2010 and 2021. The fall, he further said, was short of the 10 percent annual growth rate envisaged in the EAC Industrialisation Policy (2008-2032).

“This is nowhere near the double-digit growth envisioned,” Mr Havugimana told a meeting of the EAC sectoral council on trade, industry, finance and investment. He said that due to the slow pace of MVA growth, relative to Gross Domestic Product (GDP), the share of manufacturing in GDP has been contracting. Previously manufacturing contributed more than ten percent of the region’s GDP but has now dropped to less than eight percent.

“This is raising doubts about structural transformation through industrialisation,” Mr Havugimana said at the meeting held in Moshi.

Lesu and kanga to get new EAC textiles boost (The Independent Uganda)

The East African Community-EAC is now pushing for traditional wear and garments made from local materials in a bit to revive the region’s textile industry. A policy organ says if the lesu and kanga are encouraged as wear or inputs for clothes, it will go a long way in supporting cotton farmers, boosting industrialization, and saving foreign exchange. For close to ten years now, the East African Community has sought to jointly revive and grow the local textile industry but efforts are yet to bear fruit.

Now the Sectoral Council on Trade, Industry, Finance and Investment (SCTIFI) called on EAC the Partner States to adopt the use of traditional or folklore wear as official Government dresses for official events, as part of the “Buy East Africa, Build East Africa” strategy.

The council, at its just-ended 38th Extraordinary meeting, also encouraged the countries to establish digital platforms to support the exchange of information on the harvesting of cotton and trade of cotton lint in order to increase the intra-EAC trade on the products.

The ministers also proposed that textile and textile articles be moved to the maximum band (of goods protected by high tariffs on imports) to stimulate local production.

EAC members urged to remove bottlenecks obstructing industrial development (Capital Business)

Seven member states of the East African Community (EAC) have been urged to remove restrictions and bottlenecks that obstruct industrial development in the region. A statement by the EAC headquarters in Tanzania’s northern city of Arusha said the appeal was made during the 38th Extra Ordinary Meeting of the Sectoral Council on Trade, Industry, Finance and Investment dedicated to industrialization held in Tanzania.

According to the statement, the chairperson of the meeting, Burundian Minister of Finance, Budget and Economic Planning Audace Niyonzima, said industrialization, trade, finance, and investment are important pillars of integration, and their development will help to deepen integration as the region moves toward the next milestone of financial integration.

Niyonzima called on EAC member states not only to put in place clear industrial policies and strategies but also to implement them on the ground to support economic development and employment for EAC citizens.

The rapid rate of competition law developments across Africa (ZAWYA)

Baker McKenzie’s latest Africa Competition Report 2022 provides a detailed analysis and overview of recent developments in competition law enforcement and competition policy in 32 African jurisdictions and regional bodies. The Report outlines how, over the past two years, African competition regulators have actively engaged in efforts to address pandemic-related challenges, but there has also been a general upward trend in competition policy enforcement across the continent. This trend is highlighted by a number of significant recent developments in competition law regulation across the continent. Countries and regions with recent competition law developments include the Common Market for Eastern and Southern Africa (COMESA), Egypt, Ethiopia, Ghana, Kenya, Mauritius, Mozambique, Namibia, Nigeria and South Africa.

AfDB supports Africa fintech hub project with $525,000 grant (News Agency Nigeria)

The African Development Bank (AfDB), have signed a 525,000 dollar agreement to support Africa Fintech Network’s (AFN)’s Hub project. Mr Lamin Barrow, the Director-General, AfDB, Nigeria Country Department, during the signing in Abuja on Tuesday, said the project would boost the fintech industry on the continent.

This grant of 525,000 dollars, will support the operationalisation of an on-line digital hub to serve as a repository of knowledge for fintech entities across the continent, and globally. “ The Digital Hub, which is to be delivered through a strategic partnership between the Africa Fintech Network and Cenfri, will help to strengthen the fintech ecosystem across Africa, and boost the industry’s competitiveness.

The grant is funded by the Africa Digital Financial Inclusion Facility (ADFI).

As China opens up to African farms, long road still ahead for ‘green lanes’ (South China Morning Post)

A variety of raisins from South Africa are now reaching Chinese consumers, as doors open wider to African food products under President Xi Jinping’s “green lanes” promise.

“High quality fruit from Africa is gaining more and more recognition in the Chinese market,” Wu Peng, director general of the Chinese foreign ministry’s African affairs department, tweeted recently. This comes as China imports more farm produce from Africa, including avocados, cashews, sesame seeds and chilli peppers, as agriculture becomes the new focus of its engagement with the continent.

Can Russia Increase Trade With Africa Beyond Rhetoric (Business Post Nigeria)

Russian President Vladimir Putin spoke at the International Parliamentary Conference Russia – Africa in a Multipolar World held in Moscow under the auspices of the State Duma of the Russian Federal Assembly on March 20.

The partnership between Russia and African countries has gained additional momentum and is reaching a whole new level, he noted in his speech, and along the line, adding that additional opportunities are opening up by the process of establishing the African Continental Free Trade Area (AfCFTA), which began in 2021, which in the future will become a continental market which favours developing ties both through the Eurasian Economic Union and bilaterally.

“Mutual trade is growing every year, which reached almost $18 billion last year. It is unlikely that such a figure can fully suit us, but we know that this is far from the limit. The development of counter-commodity exchanges will undoubtedly be facilitated by a more energetic transition in financial settlements to national currencies and the establishment of new transport and logistics chains,” he added.

Trade tracker: EU trade deals (UK in a changing Europe)

The EU has signed two economic partnership agreements (EPAs), one with West Africa and the other with the East African Community (EAC). They have yet to come into force. Upon ratification, the deals will reflect one of the first major trade divergences between the EU and the UK from the EU side.

The West Africa EPA involves 16 West African states that did not previously have trade deals with the EU. For the EPA to be fully ratified, all 16 states must sign the deal and then adopt it in their respective legislatures.

More flexible rules of origin will allow products being exported from West African countries to have inputs from other countries and still be eligible for tariff-free trade with the EU, giving goods from West Africa more ability to utilise global supply chains.

In terms of sectors, West Africa’s exports to the EU consist mainly of oil and gas (58.7%) and food products (28.9%). West Africa’s imports from the EU consist of fuels (27%), food products (20.6%), machinery (23.2%), and chemicals and pharmaceutical products (10%).

The EAC EPA involves six countries, Burundi, Kenya, Rwanda, Tanzania, South Sudan, and Uganda. Kenya and Rwanda are the only countries to have signed the EPA so far, both signing it in 2016 and Kenya ratifying it in the same year. Kenya is the only country to have ratified it to date. Similar to the West Africa EPA, the EU has signed a stepping stone EPA with Kenya while they await full ratification from all six countries. The UK rolled over that deal with Kenya when it left the EU. This deal is not as far along as that of West Africa. While the deal is finalised, the process of ratification by each country’s legislative body is still in the works, therefore, its benefits will not be realised for some time.

The deal will help EAC exports of coffee, cut flowers, tea, tobacco, fish, and vegetables while it will help EU exports to West Africa, which are primarily dominated by machinery, vehicles, and pharmaceuticals.

WMO calls for more investment in integrated weather and climate services (UN News)

A recent publication contains guidelines and best examples of integrated weather and climate services from across the globe. It “provides well-timed support for this crucial decade of energy transition to net zero,” said WMO Secretary-General Petteri Taalas “By enabling WMO Members and their National Meteorological and Hydrological Services, as well as energy sector companies and practitioners, to deliver and use integrated weather and climate services, national strategies on clean and sustainable energy for all can be achieved in a timely and effective manner,” he added.

investment is critical, including to ensure that energy infrastructure is resilient to climate-related shocks, and to harness the power of energy generated from sources such as the sun and wind, the UN agency said.

Members briefed on informal dispute settlement reform talks (WTO)

Marco Molina, Deputy Permanent Representative of Guatemala to the WTO, reported in his personal capacity on informal meetings he was asked to convene by a group of WTO members on the issue of dispute settlement reform. The objective of these meetings was to have substance-based discussion to find practical solutions to the concerns identified by members, with the aim of fulfilling the June 2022 ministerial mandate of having a fully and well-functioning dispute settlement system accessible to all members by 2024.

Mr Molina said that between 6 and 14 February he had over 40 bilateral meetings with delegates and regional coordinators representing more than 130 WTO members, which was followed by an informal meeting on 17 February open to all WTO members. An online template was created for the submission of proposals, of which 70 have been received from members to date. Informal discussions were also started in small groups and open to all members for talks on the proposals put forward; so far 45 delegates have participated in the small group meetings.

Members welcome Timor-Leste’s request to join Information Technology Agreement (WTO)

Participants in the WTO’s Information Technology Agreement (ITA) welcomed at a meeting on 29 March a request by Timor-Leste to join the ITA and the ITA Expansion Agreement. Members also discussed ITA trade concerns and heard a WTO Secretariat report on latest trends in global trade in information and communication technology (ICT) products.

The Secretariat provided an update on latest trends in world trade in ITA products. The presentation noted that world exports of ITA products have more than quadrupled since 1996, reaching USD 2.5 trillion in 2021. The export of products under the ITA’s Expansion Agreement is estimated at about USD 2.1 trillion of exports in 2021, accounting for around 12 per cent of world merchandise exports. The Secretariat noted that products covered under the ITA and its expansion are among the most traded product groups in the world.

The report also noted that the ITA contributes to the reduction of import prices of IT products. These prices were around 70 per cent lower in 2021 than when the ITA entered into force in 1996. Asia’s leading role in the production and integration of ITA products was also noted, with Viet Nam becoming the world’s seventh-largest ITA product exporter.


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