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Big boost for trade in South Africa (Business Tech)
South Africa recorded a preliminary trade balance surplus of R6.9 billion in March 2023, according to the South African Revenue Service (SARS). When including trade with Botswana, Eswatini, Lesotho and Namibia (BELN), exports totalled R192.2 billion while imports totalled R185.3 billion.
SARS said that the increase in export flows in March was driven by gold, while the increase in the value of imports was due to higher importation of crude and petroleum oils.
China was South Africa’s biggest trade partner for March, making up 10.5% of total exports and 18.5% of imports. The United States (7.5%) was South Africa’s second-biggest export market, with Germany (6.5%), Japan (6.2%), and the Netherlands (4.8%) completing the top 5.
South Africa imported the second-largest amount of goods from Germany (8.0%). The United States (7.6%), India (6.9%), and Nigeria (4.3%) were also part of the top 5 countries that South Africa imported from.
Comments sought on draft policy for SMME funding (SAnews)
The Department of Small Business Development has reminded the public to submit comments on the Draft South African Small, Medium and Micro Enterprises (SMMEs) and Co-operatives Funding Policy, as the deadline approaches.
The draft policy proposes 17 critical interventions that will enable the estimated 3.2 million SMMEs and 43 000 cooperatives in the country to thrive.
These interventions include addressing fragmented financial support mechanisms, consolidating a database of small businesses, improving access to start-up capital and increasing business development support.
Kenya’s economic growth slowed to 4.8pc in 2022, KNBS says (The East African)
Kenya’s economy grew by 4.8 percent in 2022, a slower pace than 7.6 percent recorded the previous year, the statistics office has said. The Kenya National Bureau of Statistics (KNBS) released the Economic Survey 2022 Wednesday, detailing how various sectors and jobs market performed. Most sectors recorded decelerated growth compared to 2021, with agriculture and manufacturing contracting in the period.
“2022 was marked by many negative shocks from the supply side. The persistent shocks which are still present, created permanent negative effects impacting economic activity and the cost of living,” Kenya’s Treasury Cabinet Secretary Njuguna Ndung’u said.
“The economic survey will inform a raft of measures on policy reforms to support economic activity and address the cost-of-living concerns,” he added.
Nigerian govt to explore alternative funding model for oil, gas industry – NUPRC (Daily Nigerian)
The Nigerian Upstream Downstream Regulatory Commission, NUPRC, says the Federal Government has concluded plans to explore alternative funding models for the development of the country’s oil and gas resources.
Mr Komolafe said that the need to develop the country’s hydrocarbon resources required huge funding, hence the decision of the commission to develop alternative funding model for the industry. According to him, Nigeria will not be left behind in the energy conversation discussion as the country is a place where needs meet opportunities. “Africa and by extension Nigeria is well positioned because it has all it takes to bridge the energy gap in the light of energy transition.
Kenya Not Yet Fully Open to Ugandan Milk Products (Nile Post)
On March 14th, 2023, Kenya’s Agriculture and Livestock Development Permanent Secretary Harry Kimtai announced the suspension of the ban on the milk powder imports from Uganda.
However, Uganda’s milk industry players continue to grapple with non issuance of export permits and sometimes delays in issuance of the same by the Kenya Dairy Board.
Sources are indicating that some processors are not getting the permits at all questioning the criteria Kenya dairy daily board is using to award the permits. Musafari Hamidu, a truck driver of one of the leading milk companies in Uganda says that initially, each milk processor would get permits for 5 trucks a day through the Kenyan border although right now, only a few trucks can be cleared for an entire week.
According to the Dairy Development Authority (DDA) of Uganda, Milk production is estimated to have increased from 2.08 billion litres in 2015 to 2.64 billion litres in 2020. By the end of 2021 milk production was estimated to reach 2.81 billion short of the target of 3.0 billion litres. Dairy exports in the country reached a record high of 358.6 billion UGX in the last four years and nearly doubled compared to last FY 2019/20 with dairy equipment valued at 18.9 billion UGX being imported in the country to support the growing trade. This implies that milk production in Uganda is on the increase with massive investments by dairy producers and farmers.
Central African Republic: 2023 Article IV Consultation (IMF)
CAR is on the brink of a humanitarian crisis with acute food insecurity and access to health care drastically impaired. Social tensions have ratcheted up, including strikes in various sectors, on the back of a cost-of-living crisis triggered by the Russian invasion of Ukraine. Political tensions have also escalated from the President’s plans of a third mandate requiring revisions to the constitution.
The 2021 suspension of budget support—which deprived the government of 5 percent of GDP in financing—is now constraining, following the erosion of buffers, including the 2021 SDR allocation. The protracted balance of payment need is preventing the authorities from delivering basic public services to an already afflicted population. Against this backdrop, the authorities have requested Fund financing assistance.
ECA supports Benin in the formulation process of its AfCFTA National Strategy (UNECA)
The United Nations Economic Commission for Africa (ECA), through its Sub-Regional Office for West Africa, is supporting Benin in its drive to make the African Continental Free Trade Area (AfCFTA) operational. Through this support, the Ministry of Industry and Trade launched Thursday in Cotonou the process of formulating a national AfCFTA strategy that will serve as a framework for its implementation.
In his speech at the opening ceremony of the workshop, the Secretary General of the Ministry of Trade and Industry, Mr. Salami Amzath Bissiriou, said that “It is about constructing an economic zone where our country necessarily has a role to play, a stone to contribute to the consolidation of the common edifice.
As for the Country Coordinator of the United Nations System in Benin, Salvator Niyonzima, he recalled the benefits of this great inter-African market in relation to the objectives of the workshop. According to him, the reason for the presence of civil society organizations, executives from sectoral ministries and the private sector at this meeting is attributable to their willingness to engage in a dialogue that, in the near future, will lead to an AfCFTA strategy for Benin.
Angolan Infrastructure Poised to Spur Growth and Diversification (Energy Capital & Power)
As such, Angola’s Energy Sector Efficiency and Expansion Program Phase I will serve to connect the country’s three grid systems – the northern, central, and southern systems – through the construction of a 16,340km-long 400 kV North-Central-South transmission line by 2025. The interconnection system will evacuate approximately 1,000 MW of low-cost hydropower from the Kwanza River basin to the country’s capital and other population centers in the southern part of Angola.
This project is being implemented through a collaboration between the U.S. Agency for International Development’s Power Africa initiative and multilateral development financial institution, the African Development Bank (AfDB), as part of efforts to improve electricity distribution and strengthen the financial viability of the power market. The project will be overseen by Angola’s Ministry of Energy and Water and will involve a $530 million investment from the AfDB.
With the country’s national budget dedicated to the production, transmission, and distribution of electricity having increased from $482 million in 2021 to $490 million in 2022, Government support to promote the successful implementation of projects led by the private sector will be imperative towards supporting Angola’s power distribution capabilities. As such, major opportunities for foreign investors and strategic partners to participate in the transformation of Angola’s energy sector exist to improve the regulatory environment within the country; develop energy regulation, planning, and procurement; and enable regional harmonization and cross border trade.
Kenya can be a hub for USA to enhance trade, investment relationship with Africa through AfCFTA (Medafrica Times)
During the implementation of the Africa Continental Free Trade Area (AfCFTA) agreement, Kenya can be used by the United States as the hub for reaching the 1.3 plus billion African market, Kenya’s senior government official has said as Washington has been trying to strengthen its the trade partnership with Africa.
During his recent visit to Washington, DC, the Cabinet Secretary for Foreign and Diaspora Affairs, Alfred Mutua, told the American government that Kenya is open for business and encouraged American investors to invest in the country. Mutua also said the US is setting up a framework to allow Kenyans to apply for jobs and to get work visas on time and encouraged them to use this opportunity. While attending a bilateral session for negotiations on the Kenya-US Strategic Trade and Investment Partnership (STIP), Mutua welcomed the fact that the two countries have agreed to partner in the areas of trade and investment for job creation and visas for youth empowerment, health, food security, climate change, regional peace and security.
Gabon, Sierra Leone Accede to Establishment Agreement of Afreximbank’s Fund for Export Development in Africa (FEDA) (Afreximbank)
The Fund for Export Development in Africa (FEDA), the development impact-focused subsidiary of African Export-Import Bank (Afreximbank), has announced the accession of the Gabonese Republic and the Republic of Sierra Leone to the Fund through their recent respective signing of the FEDA Establishment Agreement.
FEDA described the accession by the two countries as a significant milestone, which will strengthen its ability to provide crucial support to African economies and achieve its objectives effectively. The new memberships expand the reach of FEDA’s interventions and reflect the Fund’s unwavering commitment to its mandate of providing long-term capital to African economies with a focus on industrialization, intra-African trade and value-added exports.
Technological Innovations in Logistics Support the Surge of Global Commerce (Engineering News)
As trade grows, particularly in Africa, constant technological innovation ensures that logistics providers keep pace, writes Natasha Parmanand - Managing Director of FedEx Express Sub-Saharan Africa Operations.
Africa already imports R676 billion (approximately USD37 billion) in freight and logistics goods every year, and the World Economic Forum (WEF) predicts that AfCFTA ratification will boost demand for intra-African freight by 28% by 2030.
Logistics networks are the backbone for trade growth, and it will take rapid and ongoing technological innovation to ensure that logistics providers keep pace with this growth. Fortunately, the logistics industry has a long history of technology-driven innovation, and this is likely to accelerate in the future.
In the future, the most successful logistics organizations will be those that are most agile and can quickly adapt to their customers’ needs. E-commerce customers are moving rapidly towards mobile online shopping – what’s known as m-commerce. Therefore, future online retail platforms will have to be optimized for mobile and must meet consumers where they are – not just on online retail sites, but on social media platforms like TikTok, Instagram, and in metaverse-based social and gaming environments.
The ECOWAS Commission through the Private Sector Directorate organized a technical meeting with private sector actors and the UEMOA Commission to review implementation of the 2015–2020 Regional Private Sector Development Strategy and to provide guidance for the development of the new strategy to cover a ten-year period, 2023–2033.
The meeting which was held in Abuja, Nigeria from 25-27 April 2023, also discussed the draft terms of reference for the development of the Regional Strategy for the Promotion of Start-Ups and digital enterprises.
Commissioner Economic Affairs and Agriculture, Madam Massandjé TOURE-LITSE, represented by the Acting Director Private Sector, Dr. Tony Luka ELUMELU said “some of these issues are enshrined in the ECOWAS 2050 vision, the Community Strategic Framework (CSF) Priorities and key relevant policies of ECOWAS like the 2022-2032 Micro, Small and Medium-sized Enterprise (MSME) Charter, the 2021 Public-Private Partnerships Policy and Guidelines. Others she said, built-in the values of the Fourth Industrial Revolution (4IR)/digitization including the emergence of digital enterprises or startups, digital currencies and blockchain technology and the growing importance of regional value chains vis-à-vis global value chains and globalization.
“The commencement of the African Continental Free Trade Area (AfCFTA), the African Union (AU) Agenda 2063, the UN SDGs (agenda 2030) and the ECOWAS Common External Tariff (CET) are other important emerging issues that the new strategies should consider” Mrs TOURE-LITSE, stressed.
ITC and partners to propel ‘Made in Africa’ label and boost trade under AfCFTA (New Ghana)
The Nairobi-based African Organisation for Standardisation (ARSO) and the Geneva-based International Trade Centre (ITC) today signed a memorandum of understanding (MOU) to contribute to continent-wide efforts to establish a ‘Made in Africa’ label and boost trade under the African Continental Free Trade Area (AfCFTA).
The agreement renews a working commitment between the two organizations for five years until 2028, with an updated cooperation framework reflecting developments in Africa’s regional integration efforts, underpinned by the AfCFTA, and a growing global shift towards the use of sustainability standards to demonstrate commitment to good environmental, social, ethical and food safety practices.
At the signing ceremony, ARSO Secretary General Dr. Hermogene Nsengimana said: ‘This MOU will generate greater commitment between our organizations and boost intra-Africa trade, particularly through diversified production of value-added industrial products, across all priority sectors of Africa’s economy. Together, we will accelerate standardization activities to increase the competitiveness of African enterprises, strengthen regional value chains and pave the way for Made in Africa goods and services.’
African countries must join forces to diversify energy mix through AfCFTA – Kyari (Newsdiaryonline)
Mr Mele Kyari, the Group Chief Executive Officer, Nigerian National Petroleum Company Ltd. (NNPCL), has called on African countries to take advantage of the implementation of the African Continental Free Trade Agreement (AfCFTA).
Kyari said this would help to diversify their energy sources into a sustainable and low-carbon energy mix, and ensure sustainability of the energy sector in the continent.
Kyari was represented by the Executive Vice President, Upstream, Mr Adokiye Tombomieye, while delivering a keynote address at a luncheon and panel session organised by Petroleum Technology Association of Nigeria (PETAN) at the ongoing Offshore Technology Conference (OTC), on Tuesday in Houston, Texas, United States.
He reiterated the need for African Union to adopt the African common position on energy access and equitable transition, which is a comprehensive approach that charts Africa’s short, medium, and long-term energy development pathways to accelerate universal energy access.
Lead participation, advocacy for AfCFTA – Sosu urges Africa’s youth (MyJoyOnline)
The Member of Parliament for Madina, Francis-Xavier Sosu, has urged the Youth of Africa to lead participation and advocacy for the Africa Continental Free Trade Area (AfCFTA).
Sosu said: “If the AfCFTA is to work, then the Youth must be at the forefront by way of participation and advocacy to make demands, insist on them, and drive home same for the attention of policy makers. If Africa’s Youth across the Continent decide that enough is enough and this is the way we want to go, then various Heads of States and Governments will have no choice but to provide political support and show strong commitment towards implementing the objects of the AfCFTA Agreement.”
Economic Growth in Sub-Saharan Africa Could Permanently Decline if Geopolitical Tensions Escalate (IMF)
Sub-Saharan Africa could stand to lose the most if the world were split into two isolated trading blocs centered around China or the United States and the European Union. In this severe scenario, sub-Saharan African economies could experience a permanent decline of up to 4 percent of real gross domestic product after 10 years according to our estimates—losses larger than what many countries experienced during the Global Financial Crisis.
Economic and trade alliances with new economic partners, predominantly China, have benefited the region but have also made countries reliant on imports of food and energy more susceptible to global shocks, including disruptions from the surge in trade restrictions following Russia’s invasion of Ukraine. If geopolitical tensions were to escalate, countries could be hit by higher import prices or even lose access to key export markets—about half of the region’s value of international trade could be impacted.
The losses could be compounded if capital flows between trade blocs were cut off due to geopolitical tensions. The region could lose an estimated $10 billion of foreign direct investment (FDI) and official development assistance inflows, which is about half a percent of GDP a year (based on an average 2017–19 estimate). The reduction in FDI in the long run could also hinder much-needed technology transfer.
The ECOWAS Commission organized the 3rd Joint Meeting of the ECOWAS Ministers of Trade and Industry (ECOMOTI) in Abidjan, Côte d’Ivoire from 27th – 28th of April 2023, to consider, approve and recommend key trade policy instruments to the ECOWAS Council of Ministers for adoption. The Meeting featured a round table with the World Trade Organization (WTO) to discuss the outcomes of the 12th WTO Ministerial Conference (MC12) and preparations for the MC13.
The Meeting approved and recommended to the ECOWAS Council of Ministers for adoption, the ECOWAS E-Commerce Strategy and Implementation Plan (2023 – 2027), the ECOWAS Implementation Strategy for the African Continental Free Trade Area (AfCFTA), and the Directive of Consumer Protection. Furthermore, the meeting commended the ECOWAS Commission for the progress made in the development of ECOWAS Common Trade Policy; ECOWAS Trade & Investment Promotion Strategy; and Regional Trade & Transport Facilitation Strategy. The Ministers took note of the implementation of the Informal Trade Regulation Support Programme (ITRSP) and discussed issues related to trade in Donkeys and Donkey products, gold trade, illegal trade in cash crops, as well as food insecurity.
African infrastructure is bankable, says Africa50 CEO Alain Ebobissé (African Business)
Africa50’s mandate is to help close that infrastructure gap by channelling direct public and private investment towards that purpose. Its focus is on medium to large scale projects that have the potential to deliver good returns for investors.
“The gap is huge but we are making progress,” Ebobissé says. While there are a lot of bankable projects on the continent and a wealth of capital that is seeking exactly those projects, a lot depends on how the projects are structured.
“Sometimes, when you have risks that the private sector is unable or unwilling to take, you need to have risk mitigation instruments so that you have a bankable project,” he says.
“There are differences in terms of the investment climate in different African countries,” Ebobissé accepts, “but there are a lot of success stories on the ground – some of which we have been involved in. We have to talk about those success stories; those projects that are delivering good impact and decent returns,” he urges.
Digital technologies key to inclusive growth in Africa - African Union Commissioner (AfDB)
Digital technologies could offer Africa a great chance to unlock new pathways for rapid, inclusive economic growth and job creation, according to Ambassador Albert Muchanga, the African Union’s Commissioner for Economic Development, Trade, Tourism, Industry and Minerals.
In an address to the recent 55th Conference of African Ministers of Finance, Planning and Economic Development, Muchanga said the continent needed to raise the requisite funding to develop its digital knowledge base to achieve growth.
“Mobilization of domestic resources should be prioritized with a particular emphasis on fighting illicit financial flows, which deprive the continent of approximately $90 billion annually,” he said at the conference organized by the United Nations Economic Commission for Africa (UNECA).
President Ruto calls for removal of barrier to the movement of people to boost regional integration (EAC)
The President of the Republic of Kenya, H.E. William Samoei Ruto, has called on the members states of the East African Community (EAC) and the Intergovernmental Authority on Development (IGAD) to remove barriers to the free movement of people, goods and services in order to enhance regional integration in Eastern Africa.
President Ruto said the free movement of people, goods and services was necessary for sustainable growth and development of the East and Horn of African region. The President said it is the responsibility of the member states in the region to eliminate national boundaries that have since become roadblocks and impediments to the movement of people and commodities across the region.
President Ruto was speaking during the launch of a flagship report titled ‘The State of Migration in the East and Horn of Africa’ at the Kenyatta International Convention Centre in Nairobi, Kenya. The report is the product of collaboration between the International Organisation for Migration (IOM), IGAD and EAC.
Economists divided about global economic recovery this year (Engineering News)
The continuing uncertainty of the global economic outlook is reflected in the striking spread of responses to international organisation the World Economic Forum (WEF) ‘Chief Economists Outlook’ survey, in which experts are evenly divided on the prospects for the global economy, with equal shares of 45% saying that a global recession this year is likely or unlikely.
Further, on the economic policy front, 72% predict proactive industrial policy to become an increasingly widespread phenomenon over the next three years, the WEF notes.
Meanwhile, the chief economists were unanimous in anticipating further changes in the structure of global supply chains, the WEF points out.
Respondents were, however, divided on whether industrial policy will act as an engine of innovation, but they highlighted several potential concerns, including 91% noting a deepening of geo-economic tensions, 70% pointing to the stifling of competition and 68% highlighting a problematic increase in sovereign debt levels.
Botswana President: Inclusive, sustainable trade will allow Africa to realize full potential (WTO)
The WTO should work towards creating a more inclusive trading system that ensures all members of society can benefit from the opportunities that trade provides, H.E. Dr Mokgweetsi E.K. Masisi, President of Botswana, said on 2 May at an event held at the WTO as part of the Presidential Lecture Series. In the run-up to the 13th Ministerial Conference to be held in February 2024, President Masisi called on WTO members to ensure that the concerns and interests of all developing countries, particularly those in Africa, are adequately addressed.
DG Okonjo-Iweala noted that Botswana — like most African countries — still faces serious challenges in terms of export diversification, creating jobs, improving skills for new generations and achieving growth that is both socially equitable and environmentally sustainable.
“President Masisi’s government has already started to answer these questions with its reset agenda, promoting digital technology and job creation for young people, especially through value chain development in key sectors, such as mining, tourism, agriculture and education,” she said.
DDG Ellard highlights importance of WTO work on fisheries subsidies for Africa (WTO)
Africa stands to gain greatly from strengthened ocean sustainability if the entry into force of the WTO Agreement on Fisheries Subsidies and further outcomes from the second wave of negotiations can be secured by the 13th Ministerial Conference (MC13) in February 2024, Deputy Director-General Angela Ellard said on 2 May. DDG Ellard made the remarks at a workshop on fisheries subsidies organized by the WTO for English-speaking African countries held in Zanzibar, Tanzania.
“As a continent surrounded by oceans and home to numerous fisheries, Africa is responsible for the management and conservation of a significant portion of the world’s marine resources,” DDG Ellard said. “With over 12 million people in Africa depending directly and indirectly on the marine fishing industry for their livelihoods, it is crucial that we work together toward sustainable management of our ocean resources,” she noted.
Global forum spotlights actions to make trade more sustainable and inclusive (UNCTAD)
UNCTAD will host the third UN Trade Forum on 8 and 9 May 2023 to identify trade policies that can help countries grow their economies while tackling pressing global challenges and accelerating progress towards achieving the UN’s Sustainable Development Goals
The forum will give particular attention to developing countries, which have been hit hardest by multiple global crises including the COVID-19 pandemic, the war in Ukraine and the climate emergency.
“A cascade of global crises has disrupted international trade, including for essential foods, and revealed the trading system’s vulnerabilities and imbalances,” UNCTAD Deputy Secretary-General Pedro Manuel Moreno said ahead of the forum.
“But trade remains a very powerful engine for sustainable and inclusive growth,” Mr. Moreno said. “And UNCTAD remains committed to providing the data and analysis policymakers need to take informed decisions and ensure trade growth benefits all people and the planet.”
Higher global wheat price looms as UN, Russia deal uncertain (The East African)
Kenya is staring at elevated wheat prices in the coming months should Russia fail to renew a United Nations-brokered deal on grain passage along the Black Sea this month (May).
Russia said it would not renew the Grain Initiative deal, first reached last year if the US and European Union did not lift the sanctions they have slapped on Moscow.
The current deal, which allows grain from Ukraine to pass through the Black Sea Channel, is due to expire on May 18.But Russia has repeatedly said it will not permit the deal to be extended unless the West removes obstacles to Russian grain and fertiliser exports.
Kenya, which imports up to 75 percent of the annual wheat requirement, has exhausted the local stocks and is currently relying on imports to meet the growing demand for the grain in the country.
Russia and Ukraine account for over a third of the world’s total wheat with any disruption in supply having serious ramifications on countries that rely on imports to bridge their deficit.
Regional integration is key to economic growth. Here’s why (WEF)
Against a backdrop of global fragmentation, inflationary pressure and geopolitical unrest, many countries are pursuing efforts to deepen regional economic integration.
Regional integration was a major topic of the World Economic Forum’s Growth Summit 2023, which took place at the Forum’s headquarters in Geneva, Switzerland, between 2-3 May.
In a session titled Regional Trade and Cooperation in a Fragmenting World, top business and trade officials discussed how best to foster regional trade and explored how regional cooperation can bolster the global economy. For panellists, the message was clear: to avoid a lost decade, economies must preserve and expand international trade.
South African business community expects BRICS summit to enhance trade (Xinhua)
BRICS countries (Brazil, Russia, India, China and South Africa) are expected to discuss measures to relax some trade hindrances, increase trade among member states and promote post-pandemic economic recovery, said Ayanda Ntsaluba, an official from the South African Chapter of BRICS Business Council, Tuesday.
Ntsaluba told Xinhua in an interview that they have been engaging with business councils from other BRICS countries on the ideas, and have invited leaders from regional economic communities to meet with the BRICS leaders to discuss business.
Bilateral trade between South Africa and China as well as that between South Africa and India have shown impressive growth, he noted, adding that they would like to further strengthen relatively low trade with Russia and Brazil.
Ntsaluba said they would like to explore how to increase the export of South African beef, grapes and wines to China and other BRICS countries.
Rich nations to meet overdue $100bn climate pledge this year (Engineering News)
Wealthy nations are on track this year to meet their overdue $100-billion (about R1.8-trillion) climate finance pledge to developing countries, three years later than promised, Germany’s foreign minister Annalena Baerbock said on Tuesday.
Baerbock said donor countries met on Monday to discuss progress towards their pledge, made back in 2009, to transfer $100-billion per year from 2020 to vulnerable states hit by increasingly severe climate change impacts.
Uncertainty in Preferential Trade Agreements: Impact of AGOA Suspensions on Exports (World Bank)
This study examines the impact of the abrupt suspension of African Growth and Opportunity Act benefits on exports from eligible African countries. The study uses a triple difference-in-differences estimation that controls for both country- and product-level export changes. The results suggest that the suspension of the African Growth and Opportunity Act has had a considerable negative impact on the level of exports to the United States. The impact appears to be bigger for countries with a high African Growth and Opportunity Act utilization rate.
The suspension is associated with a 39 percent decline in exports to the United States. At the product level, the suspension hurt apparel and textile exports, leading to a decline of their exports by about 88 percent. Understanding the impact of withdrawing access to a nonreciprocal trade agreement is particularly important now, as the European Union began negotiating Economic Partnership Agreements with African countries, as a sign of a shift to reciprocity; the United States is considering a similar path of negotiating free trade agreements with individual African countries. These developments underscore the need to prepare for a post–African Growth and Opportunity Act period with more reciprocity, as trade uncertainty is becoming rampant.
Air Cargo Declines Moderate in March (IATA)
The International Air Transport Association (IATA) released data for March 2023 global air cargo markets showing a continued decline against previous year’s demand performance. This trend began in March 2022.
“Air cargo had a volatile first quarter. In March, overall demand slipped back below pre-COVID-19 levels and most of the indicators for the fundamental drivers of air cargo demand are weak or weakening. While the trading environment is tough, there is some good news. Airlines are getting help in managing through the volatility with yields that have remained high and fuel prices that have moderated from exceptionally high levels. Looking ahead, with inflation reducing in G7 countries policy makers are expected to ease economic cooling measures and that would stimulate demand,” said Willie Walsh, IATA’s Director General.
African airlines saw cargo volumes decrease by 6.2% in March 2023 compared to March 2022. This was an improvement in performance compared to the previous month (-7.4%). Notably, Africa to Asia routes experienced significant cargo demand growth in March.
