tralac Daily News
President Cyril Ramaphosa says it is critical that South Africa remains on par with other countries that have taken steps to incentivise manufacturers to invest in the production of electric vehicles in the country. This after global auto manufacturer BMW announced that it will be investing some R4.2 billion to equip its Rosslyn Plant in Tshwane to build the next generation BMW X3 hybrid plug in vehicle. This will be the first locally produced electric vehicle to be produced on South African soil.
President Ramaphosa emphasised that government, civil society, business and labour must work together to ramp up production of these vehicles to secure the future of the auto manufacturing in the country in the face of decarbonisation. “Among other things, this means that auto manufacturers need to be supported to expand their investment in the production of new energy vehicles in South Africa. We currently have a range of measures to support automotive manufacturers, such as the Special Economic Zone incentives, the Automotive Investment Scheme and others.
“We will soon be finalising a strategy to support the transition to electric vehicle manufacturing that is affordable and effective. It is key that South Africa keeps up with other countries, including on the continent, that are incentivising the manufacture and uptake of electric vehicles as the world moves towards decarbonisation,” the President said on Monday in his weekly newsletter.
For the first time in the last five years, the Asia-Pacific (APAC) region’s share of South Africa’s apparel imports has fallen below 70 per cent. Remarkably, Africa’s share crossed the 25 per cent threshold in the trade during the first four months of this year.
Despite the fact that the Africa region is emerging as a global textile hub, South Africa still relies heavily on the Asia-Pacific region, specifically China, for its imports. Between January and April 2023, South Africa imported apparel worth $595.730 million. Of the total inbound shipment, the Asia-Pacific region accounted for 68.67 per cent, or $409.074 million. This is the first time in five years that the Asia-Pacific region’s share has dipped below 70 per cent. Meanwhile, the Africa region’s share rose to 25.89 per cent, breaching the quarter mark for the first time, with imports valued at $154.238 million
African countries’ efforts to tap into South Africa’s apparel imports have progressed slowly. The continent managed to increase its share by less than four percentage points over the last five years. In the period of January-April 2019, South Africa’s apparel imports were valued at $616.405 million, with the Asia-Pacific region accounting for 73.95 per cent and Africa for 21.70 per cent.
Over the course of 2022, South Africa imported apparel worth $1,838.027 million. The Asia-Pacific region’s supply was valued at $1,229.300 million (66.88 per cent) and Africa’s at $517.242 million (28.14 per cent) of the total trade. Consequently, Africa’s share has already surpassed a quarter in the full year trade.
Tanzanian farmers bear the brunt of maize export restrictions as prices drop (The East African)
Tanzania’s restrictions on cereal exports to Kenya and Uganda have seen prices of maize dip in the country, prompting farmers to petition their Members of Parliament to press the government to liberalise the trade. Low prices have been recorded in most growing areas in the southern highlands.
Tanzania is the major exporter of maize and rice to Kenya and other East and countries, including eastern DR Congo, Burundi and South Sudan.
According to the new guidelines, exporters are required to open and register a local office in Dar es Salaam, which will deal with their exports, and obtaining export licences, which farmers say has introduced barriers to trade and impacted prices.
“The government needs to allow price competition in the market, as farmers are getting little from their efforts despite incurring huge expenses in production,” Deus Sangu, MP for Kwela in Rukwa region, said.
The Togolese Assembly allowed the government to ratify the cooperation agreement between the West African Monetary Union (UMOA) member states, countries that share the CFA franc, and France. The Assembly unanimously approved the move last Thursday, June 29, during its sixth ordinary plenary session of the year. Sani Yaya, Togo’s Minister of Economy and Finance, was present.
The new monetary cooperation agreement was signed on December 21, 2019, in Abidjan, Côte d’Ivoire. It is a “significant revision” of the agreement in effect since December 4, 1973, according to the Assembly.
The updated version, indeed, prepares the Union’s states for the introduction of the ECO and ”promotes Togo’s growth and attractiveness.” By ratifying the document, Togo tells other WAMU States that it has completed the internal procedure necessary for the agreement to come into effect.
Both for Togo, and the region concerned, the recent announcement is one of the latest developments in a process that started in 2019, following many debates about the future of the CFA franc, which some people view as a colonial relic that should be replaced.
Ethiopia’s Ambassador to Uganda, Etsegenet Bezabih Yimenu has hailed the ‘ever-growing’ bilateral ties between the two countries.
Yimenu says the trade relations between Uganda and Ethiopia are improving but points out that there is still a “job to be done” for the two countries to reach their trade volume potential.
Yimenu highlighted that whereas Uganda and Ethiopia have geographical location and economic zone to their advantage, the two countries have not done enough to promote trade between them,
something she says her Mission is keenly interested in addressing.
“We haven’t done much to promote trade between our two countries. In the next years, we need to first of all promote business between us. It can be through connecting institutions,” Yimenu said.
China pledges to strengthen trade ties with EAC (Tanzania Daily News)
CHINA has pledged to strengthen cooperation with the East African Community (EAC) in capacity building, trade, infrastructure development and other fields. The Chinese Ambassador to Tanzania and the EAC, Chen Mingjian, said at the EAC Headquarters here last week that China as the world’s largest developing country was highly optimistic about promoting economic growth not just in the EAC but on the entire African continent.
“China highly appreciates the significant contribution made by EAC in maintaining regional peace and stability, improving regional infrastructure, jointly fighting against the Covid-19, promoting regional economic integration and economic recovery of countries in the region,” said Ambassador Mingjian when she handed over eight vehicles – three buses and five double cabin pick-ups – to the EAC.
Kenyan President William Ruto, in early June 2023, called for the introduction of a single African currency to ease trade on the continent during the 22nd Common Market for Eastern and Southern Africa (COMESA) Heads of State and Government Summit in Lusaka, Zambia. Ruto emphasized that regional integration would be enhanced if citizens did not have to worry about which currency to use for trade. Malawi’s President Lazarus Chakwera also stressed the urgency of achieving regional integration and highlighted the enormous potential for intra-COMESA trade.
Meanwhile, COMESA Chairman Abdel Fattah al-Sisi urged member states to collaborate in building infrastructure that would facilitate the movement of goods and people in the region, promoting integration. These developments are crucial for African family businesses, which stand to benefit significantly from single currency policies that break down borders and enable cross-border trade.
A single currency policy focused primarily on trade can help family businesses doing business in Africa in a number of ways, even if it is restricted to trade.
A single currency policy can help promote greater regional integration, which can lead to increased collaboration and innovation among family businesses in Africa. This can help create new opportunities for growth and expansion and help family businesses to remain competitive in an increasingly globalized economy.
Energy sector seeks financing solutions tailored to Africa’s needs (The East African)
Players in Africa’s energy sector are asking private investors and development finance institutions to tailor their financing solutions to the continent’s needs to help in the provision of affordable electricity to low-income households. Speaking at the 25th edition of the Africa Energy Forum, Uganda’s Minister for Energy and Mineral Development Ruth Nankabirwa pushed for loans with a repayment holiday of up to 30 years.
“With the pressure to repay the loans within a short period of time reduced, energy producers will be able to supply power to the end user at an affordable rate, ensuring more Africans are connected to the power grid,” she said. “When the cost of capital or the pressure to pay back is high, then the power tariffs will also be high.
She said that though Africa is home to abundant natural resources, funding barriers have for a long time affected the production and transmission of electricity in the continent, with more than 600 million Africans not having access to clean energy.
Compared with other parts of the continent such as Central Africa, the situation is not as dire in East and Southern Africa. However, challenges of reliability and regular power shortages continue to persist, with electricity prices remaining high.
Questions abound as to whether the East African Community (EAC) countries will unanimously agree to domesticate their air travel. An advice by the regional MPs to convert EAC air transport charges from international to domestic category is not likely to get an easy nod from governments. The lawmakers believe the mechanism would significantly lower passenger airfares, lower tariffs on aircraft and cargo movements.
“In the spirit of Common Market, the air traffic movements within the EAC region should be converted from international to domestic category,” EALA members maintain in their oversight report on the aviation industry within EA. Members of the East African Legislative Assembly (Eala) maintained that the high cost of air travel was still a drawback in the EAC. These include taxes paid by passengers on international departure in airports within the region such as passenger service charges and security and safety fees.
Ethiopia Applies To Join BRICS (Silk Road Briefing)
Ethiopia has made an official application to join the BRICS grouping and hopes for a positive decision on its application to join the BRICS member states, Ethiopian Foreign Ministry Spokesman Meles Alem has stated, saying “We expect BRICS will give us a positive response to the request we have made.”
Ethiopia has one of the fastest-growing economies in the world and is Africa’s second most populous country.
Other recent requests to join BRICS has been filed by Algeria, Argentina, Bangladesh, Indonesia, Iran, Saudi Arabia, Turkiye and the UAE, while Egypt has recently joined. The BRICS already unites Brazil, Russia, India, China, and South Africa.
Most major world powers, in principle, has agreed to support Africa’s bid to join the G20, a forum comprising 19 countries and the European Union (EU).The latest to show support was the EU on Friday.
A statement issued at one of the EU Council body of advisors meetings, underway until 16 July, reads “in line with commitments on multilateralism made at the EU-AU Summit … the European Council supports the African Union’s [AU] reinforced presence in international forums, notably in the G20”.
The US also supported the move to include the AU in the G20 during the US-Africa Leaders Summit in December last year. “Africa belongs to the table in every room - in every room - where global challenges are being discussed and in every institution where discussions are taking place,” US President Joe Biden said.”It’s been a long time in coming, but it’s going to come.”
“Humanity is in dangerous waters on climate,” UN Secretary-General António Guterres said in a video message at the start of MPEC’s latest session. “Science tells us it is still possible to limit global temperature rise to 1.5 °C, but it requires an immense and immediate global effort, and shipping, which accounts for almost three per cent of global emissions, will be vital.”
Gathering from 3 to 7 July to review ongoing efforts, the Committee is expected to adopt a greenhouse gas emissions strategy in response to climate change and threats to biodiversity, following meetings with IMO.
The revised strategy is expected to set out the way forward for possible technical and economic measures to be further developed by IMO.
Annual clean energy investments in emerging and developing economies will need to more than triple from $770 billion in 2022 to as much as $2.8 trillion by the early 2030s to meet rising energy needs and align with the climate goals set out in the Paris Agreement.
According to the report prepared by the International Energy Agency (IEA) and the International Finance Corporation (IFC), public investments alone would be insufficient to deliver universal access to energy and tackle climate change and can be used most effectively for blended finance. In turn, two-thirds of the finance for clean energy projects in emerging and developing economies (outside China) will need to come from the private sector, rising from today’s $135 billion to as much as $1.1 trillion a year within the next decade.
Lifting barriers will help emerging and developing economies benefit more fully from the opportunities of the new global energy economy and expand opportunities for private investors.