Building capacity to help Africa trade better

tralac Daily News


tralac Daily News

tralac Daily News
Photo credit: APM Terminals

South Africa dare not fail in securing future demand for platinum (Engineering News)

South Africa dare not fail in securing future demand for its “incredible” platinum group metals (PGMs) endowment, the Hydrogen Economy Discussion heard on Wednesday.

Anglo American Platinum projects and environment executive head Prakashim Moodliar outlined the widespread marketing effort under way to boost PGMs demand as well as the hugely positive benefit of adoption of the hydrogen economy. Moodliar, a keynote presenter along with German Embassy deputy head of mission Enrico Brandt, revealed the considerable work under way to map South Africa’s Hydrogen Valley further, while Brandt provided insight into the momentous acceptance of hydrogen in Germany.

“The significant growth forecasts for the hydrogen economy will offer significant demand opportunities for metals, including aluminium, copper, iridium, nickel, platinum, palladium and zinc, to support these hydrogen technologies. “This would include metal for renewable electrical technologies, and the electrolysis for renewable hydrogen, carbon storage for low carbon, nitrogen, or fuel cells using hydrogen to power transport.

Anti-dumping duties on frozen chicken up for review (Moneyweb)

Local chicken producers and importers of frozen bone-in chicken portions are gearing up for the upcoming review to reimpose anti-dumping duties against several key trade partners.

The Association of Meat Importers and Exporters (Amie) published a lengthy report arguing that the duties will have a detrimental impact on consumers and food security. The South African Poultry Association (Sapa) prepared an equally lengthy report warning against “superficial and overstated” assumptions about chicken price increases due to import duties without a proper analysis of all the factors.

The International Trade Administration Commission (Itac) introduced provisional duties against Brazil, Denmark, Ireland, Poland and Spain for six months from January to June last year. Following input from the affected countries, Itac recommended the imposition of final anti-dumping duties for a period of five years against these countries. Minister of Trade, Industry and Competition Ebrahim Patel agreed that the countries were in fact dumping their produce in the South African Customs Union (Sacu) market, causing material harm to the local industry.

However, Patel suspended the imposition of the duties for 12 months until August this year. His reason: the impact of high food inflation on struggling South Africans.

Climate commission welcomes publishing of draft SA renewable energy plan (SAnews)

The Presidential Climate Commission (PCC) has welcomed the publishing for comments of the draft South Africa Renewable Energy Masterplan (SAREM). The Department of Mineral Resources and Energy published the draft masterplan for comments on Monday. The SAREM is a document 18 months in the making with the DMRE holding extensive consultations with stakeholders, industry experts, labour and other government departments.

“The SAREM heralds a new impetus for our country’s renewable energy drive and ambition. To this end, as PCC we welcome the four priorities as outlined in SAREM being: Supporting the local demand for renewable energy by unlocking market demand and system readiness, driving industrial development by building renewable energy value chains, and supportive trade and industrial policy, fostering inclusive development through transformation, supporting the development of emerging suppliers and building local capabilities in skills and innovation and associated industrial development.

“The PCC therefore acknowledges the SAREM as a catalytic contribution to our country’s transition to a net zero carbon future and provides a baseline for social consensus and further detailed planning and implementation of essential projects and programmes to achieve our objectives by 2030,” the commission said.

EU-Kenya deal paints gloomy picture for EAC trade ties (Monitor)

The Economic Partnership Agreement (EPAs), a pact that is looking to flung open the Least Developed Countries (LDCs) market for the European Union (EU) countries manufactured goods, has started disintegrating the East African Community (EAC) bloc silently, Prosper Magazine can reveal.

According to the agreement, the EAC has offered to liberalise 82.6 per cent of her imports from the EU over a 25-year transition period by initially liberalising 65.4 per cent on entry into force of the agreement. An expert analysis of the agreement in a paper titled: ‘The inherent dangers for the EAC signing the EAC-EU EPA,’ reveals that this liberalisation is taking a static approach to development, considering that it does not envisage Uganda and the East African region as whole graduating to producing either industrial inputs or capital goods – which is absurd.

On June 9th, 2023, the EU and Kenya announced the political conclusion of the negotiations for an Economic Partnership Agreement. The Agreement will undergo legal scrubbing and translation before signature and conclusion by the EU Council, upon which the EU and Kenya can sign and ratify.  This has since renewed debate on whether the EPA, which the EU has been relentlessly pushing as its cardinal trade policy instrument, is the right tool to shape the Afro-Euro relationship.

Kenya-COMESA Deal To Increase Cross Border Trade (Kenyan Wallstreet)

Fish traders are among those set to benefit from an agreement recently signed between COMESA and the government aimed at improving participation in cross-border trade within the Eastern Africa Region.

The agreement provides technical assistance to enhance market access, expansion of value chains through the RECAMP (Regional Enterprise Competitiveness and Access to Markets Programme).The project is aimed at increasing the effective participation of Fish Traders in cross-border trade within the Eastern Africa Region by working with Non-State Actors through the Eastern Africa Platform of Non-State Actors in Fisheries and Aquaculture (EARFISH).,

With an allocation of EUR 142,177.2, the project is part of the EUR 8.8million RECAMP which aims to increase private sector participation in sustainable regional and global value chains through improved investment/business climate and enhanced competitiveness in the COMESA region.

A total of €2,349,790 million has been allocated to the sub-delegation agreement under the European Union funded Trade Facilitation Programme (TFP), a project aimed at enhancing Kenya’s progressive participation in the regional and international integration agenda through the progressive removal of trade barriers at the border.

Uganda records its largest investment in green oil field, earning Shs 5.57 trillion ($1.5 billion) in 2022 (Business Insider Africa)

According to the United Nations Conference on Trade and Development (UNCTAD), the Shs 1.55 trillion was the largest recorded in the East African sub continent, during the period under review.

The investment was majorly fueled by the joint venture between the China National Offshore Oil Corporation (CNOOC) and the Ugandan National Oil Company in Lake Albert’s oil field worth Shs23.7 trillion. Other comparable oil investments in Uganda include the Shs 12.8 trillion, 1440-kilometer East African Crude Oil pipeline, which is intended to transport oil from Uganda’s Lake Albert to Tanzania’s Tanga ports for export.

According to UNCTAD, the subcontinent’s FDI was an impressive Shs 31.7 trillion, with increases recorded across different countries. Kenya increased to Shs 2.77 trillion, Tanzania’s FDI rose to Shs 4 trillion, and Uganda’s FDI exceeded EAC’s growth projection of 3%. Regardless of the growth, the country via the Uganda Investment Authoruity (UIA) notes that the country’s FDI has underperformed, as more is required to foster the level of development Uganda aspires to.

New Malawi Economic Update Calls for Urgent Action to Address Macroeconomic Imbalances and Increase Energy Access (World Bank)

Malawi’s path towards achieving the goals of its long-term development vision, Malawi 2063, remains feasible but narrow, according to the latest World Bank Malawi Economic Monitor (MEM), Powering Malawi’s Growth: Rapidly and Sustainably Increasing Energy Access. This is because a prolonged macro-fiscal crisis, exacerbated by extreme weather events, a slow debt restructuring process, and delayed governance reforms have subdued economic growth. The new MEM says improvements in political commitment and investment, and reforms in the energy sector could help growth by pushing access to electricity above 50% by 2030.

“Malawi’s economy is weakened by foreign exchange shortages that constrain the import of essential commodities and inputs, and that lower agricultural output, as well as by erratic electricity supply and the increasing frequency of natural disasters. Its ‘polycrisis’ needs urgent movement on reforms that promote macroeconomic policy and governance, as well as a wide range of policy responses in energy, agriculture, climate adaptation, and resilience to create a stronger foundation for economic growth,” says Hugh Riddell, World Bank Country Manager for Malawi.

Ghana’s Economy Expected to Recover Its Potential By 2025, says World Bank Report (World Bank)

A combination of domestic imbalances and external shocks in 2022, led to macroeconomic challenges in Ghana. The year was marked by currency depreciation, rising inflation, and tumbling investor confidence. Pre-existing fiscal vulnerabilities such as mounting debt burden, a rigid budget weakened by high energy sector costs and chronically low public revenues, were deepened by difficult global economic conditions notes the World Bank’s latest Economic Update.

The report titled “Price Surge: Unraveling Inflation’s Toll on Poverty and Food Security” states that Ghana faces an extremely challenging outlook, and the economic situation is likely to remain challenging before it rebounds.

The report recommends that in addition to managing the immediate macroeconomic crisis, the authorities would be well served by embarking on structural reforms to tackle its root causes, boost economic growth, and build economic resilience. “In the longer term, to mitigate the impact of inflation on food security, policymakers must enable farmers to adjust to global demand and take advantage of market opportunities” said Ashwini Sebastian, Senior Agricultural Economist, and co-author “This is particularly relevant since many of the poor are farming households. Policies should therefore be evidence based and aimed at alleviating the different constraints farmers face.”

Liberia Economic Update: Improved Rice Production Is Critical for Food Security and Poverty Alleviation (World Bank)

The World Bank today launched the Fourth Edition of its annual Liberia Economic Update, “Getting Rice Right for Productivity and Poverty Alleviation.” According to the report, growth in the agricultural sector accelerated to 5.9% in 2022 from 3.3% in 2021. Increased crop production, especially rice and cassava produced primarily for domestic consumption, was the main driver of growth in the agriculture sector.

“Despite the rebound in growth led by mining and a relatively good agricultural harvest during the year, food insecurity remains a major challenge for Liberia, with more than four-fifths of the population facing moderate or severe food insecurity,” said Mack Capehart Mulbah, Acting World Bank Country Manager for Liberia. “The strong preference for rice among Liberians makes it integral to the country’s food security, poverty alleviation, and efforts to address vulnerabilities.”

Guinea suspends agricultural exports to preserve stocks (Africanews)

Guinea’s ruling junta has suspended the export of several agricultural products, including rice, potatoes, and palm oil, for six months to preserve its “food sovereignty” and “social peace”. This decision is linked to the concern to preserve stocks before the next harvests, and “not at all” to the expiry on Monday of the agreement between Moscow and Kiev, which allowed Ukraine to export cereals, notably to Africa, despite the war, the Guinean Ministry of Trade said.

The suspension of exports concerns around fifteen staple foods (rice, onions, potatoes, dried chilli peppers, fresh chilli peppers, aubergines, okra, fresh tomatoes, taro, cassava, maize, cassava, and maize flours, yams, sweet potatoes, and palm oil), the ministry said in a statement dated Monday and sent to AFP on Tuesday. Exports of these products are “prohibited for a period of six months”, on pain of fines or even criminal prosecution, it warned.

Guinea, one of the poorest countries in the world despite its rich subsoil (iron, bauxite, and gold in particular), usually exports these agricultural products to many West African countries.

Tunisia narrows food trade balance deficit (Agência de Notícias Brasil-Árabe)

Tunisia narrowed its food trade balance deficit to TNT 538.8 billion (USD 177 million) at the end of June 2023, compared with TND 1,012.5 million (USD 332 million) during the same period in 2022, leading to an improvement in the coverage rate to 86.6%, the National Observatory of Agriculture (ONAGRI) said on Monday, as per reported by TAP state news agency.

In terms of value, food exports rose by 10.3%, while imports fell by 3.5%. The decline in the deficit is mainly the result of the rise by 36.3% in olive oil exports and the fall by 15.7% in grain imports, despite the increase in imports of sugar by 118.2%, and milk and milk by-products by 61.8%. Export prices were up for olive oil, tomatoes, citrus fruits, and dates. Import prices for grain were down by 22.1% for durum wheat, by 16.1% for common wheat, 12.8% for maize and 15.0% for corn.

Mozambique and UAE negotiate creation of free trade area (Club of Mozambique)

Mozambique and the United Arab Emirates (UAE) are negotiating a Comprehensive Economic Partnership Agreement (CEPA), creating a free trade area for goods, services and investment, the UAE Embassy in Maputo announced on Monday. In a statement, the Embassy of the United Arab Emirates said that the two countries are working on the “removal of trade and investment barriers in a wide range of goods and services with a view to promoting non-petroleum bilateral trade between the two”.

“For this purpose, the Embassy of the United Arab Emirates in Mozambique has added advantages to economic partnerships through ongoing negotiations which could culminate in the coming months with the signing of the Comprehensive Economic Partnership Agreement (CEPA) which covers several economic areas that have as a vision the establishment of a Free Trade Area that attracts opportunities for access to markets for goods, services and investment between the parties,” the statement reads.

“With the signing of the joint declaration of intentions for the launch of CEPA negotiations, the UAE undertakes to strengthen its long-term economic partnership with Mozambique”, the statement continues.

African Union’s 5th Mid-Year Coordination Meeting Concludes with Strong Commitment to Accelerate Regional Integration (AU)

The African Union 5th Mid-Year Coordination Meeting, MYCM, concluded on 16th July with the adoption of a Declaration by the Heads of State and Government representing the Bureau of the Assembly of the African Union, and Chairpersons of the eight (8) Regional Economic Communities (RECs), and the Regional Mechanisms (RMs). The declaration emphasises on the need to hasten Africa’s integration process to tackle the challenges caused by globalization, and the importance of the harmonization of national and regional policies to promote socio-economic development.

H.E. Moussa Faki Mahamat, Chairperson of the African Union Commission stated that the integration process would be hampered by structural constraints such as the funding gap for the implementation of the infrastructure programme at the continental level, the deterioration of the peace and security situation in Africa, the delays in transforming productive structures in a logic that includes women and youth as entrepreneurs of progress and as a protective shield against extremism and terrorism, and the delay in the ratification of the Protocol on the free movement of persons and goods.

With efforts geared towards the acceleration of the AfCFTA, the African Union theme for year 2023, closing the infrastructure development gap is key to attracting investment and boosting intra-African trade.

H.E. Azali Assoumani, President of the Union of The Comoros and Chairperson of the African Union for 2023, noted that the development of maritime transport is one of the key factors for the success of Africa’s economic integration. 

“Indeed, intra-African trade is mainly carried out by road and sea. It is now established that the implementation of the AfCFTA could double sea freight, from 58 to 131.5 million tonnes. The island states of Africa, despite their structural fragilities, are full of opportunities and potential, given the vastness of their maritime space.”

The Third (3rd) Extraordinary Meeting of the AfCFTA Council of Ministers Responsible For Trade (AfCFTA Secretariat)

The 3rd Extraordinary Meeting of the Council of Ministers of the African Continental Free Trade Area (AfCFTA), was held from 12-13 July 2023 in Nairobi, Kenya. The importance of this assembly is reflected in the need to conclude the outstanding Rules of Origin in the Automotive and Textiles sectors and to consider other crucial trade protocols.

The Rules of Origin are pivotal in defining the economic architecture of the AfCFTA. Simply put, they are the criteria used to determine the nationality of a product, meaning they decide whether a product can benefit from preferential treatment under the free trade agreement. This is especially relevant in sectors such as automotive and textiles, both of which are significant contributors to Africa’s industrial and manufacturing growth.

In textiles, a clear, stringent, and well-enforced Rules of Origin can help protect and nurture the local textile industries from being undermined by cheap imports. The same logic applies to the automotive sector, which has the potential to generate substantial employment and develop ancillary industries. Ensuring that the benefits of the AfCFTA flow to the manufacturers genuinely located within Africa, rather than those simply rerouting their products through it, is the primary purpose of these Rules of Origin.

Africa’s Energy Experts Forge a Common Strategy to Transform the Continent’s Power Infrastructure (NEPAD)

Significant strides have been made in the establishment of the African Single Electricity Market (AfSEM) and the development of the Continental Power Systems Master Plan (CMP), paving the way for major developments to come in the energy sector.

The importance of a well-coordinated strategy to modernise Africa’s power infrastructure cannot be overstated. It is projected that the demand for electricity in the continent will triple by 2040, industrialisation, rapid urbanisation, the growing middle class, and climate change, among other driving factors.

On the 3rd -5th July 2023, energy stakeholders convened in Cotonou, Benin, to chart the path forward for the CMP and AfSEM initiatives, aiming to provide Africa with a reliable and sustainable power supply to meet the growing demands of its population. Major developments are on the horizon as the CMP work plan enters its final development phase to produce an optimised integrated generation and transmission expansion plan for 2023-2040.

Stakeholders provide inputs to the UN Global Digital Compact for an inclusive and equitable digital future (UNECA)

A regional review meeting recently took place in Cape Town to incorporate Africa’s perspective into the United Nations Global Digital Compact (GDC) and promote a more inclusive and equitable digital future. The meeting reflected on key themes: Africa’s infrastructure development, digital public goods, digital trust, data protection, human rights, regulation of emerging technologies such as AI. Experts, policymakers, and stakeholders from 32 member states representing government, private sector, civil society, and academia attended the meeting to provide technical inputs.

In his opening remarks, Fayaz King, representing the Office of the Secretary General’s Envoy on Technology, emphasized the need for Africa to take a central role in shaping the GDC. He highlighted the importance of ensuring that Africa is “not just a provider of data to a small group of entities’ but should also actively participate in shaping its digital future. He called for the “development of standards for data interoperability and effective regulations that go beyond self-regulation,” while also stressing the significance of regulating AI and handling data in a manner that informs decision-makers and serves the common good.

Agri trade to be new frontier in joint biz (China Daily)

China’s efforts to diversify its import of African agricultural products will enhance bilateral trade and create fresh opportunities for its companies to invest in countries in Africa, said government officials and business owners. Eager to boost trade value, China and a number of African countries including Madagascar, Zimbabwe, the Central African Republic and Ethiopia, jointly proposed the establishment of a liaison mechanism for sanitary and phytosanitary (SPS) cooperation in late June.

The initiative aims to align inspection and quarantine standards and rules, facilitating the export of agricultural food products from Africa to China. It represents a significant step forward in promoting trade and economic cooperation between the two sides, according to China’s General Administration of Customs.

The trade value of agricultural products between China and Africa has jumped from 33.3 billion yuan ($4.6 billion) in 2012 to 58.6 billion yuan in 2022, with an average annual growth rate of 5.8 percent, data from the GAC showed. Africa mainly exports aquatic products, honey, sesame, peanuts, tobacco, wool, cotton, soybeans, coffee and fruit to China. Trade volume in this category soared 20.4 percent year-on-year to 26.6 billion yuan in the first five months of this year.

The proposed liaison mechanism for SPS cooperation underscores the commitment of both China and African countries to create a more efficient and streamlined process for the export of agricultural food products, said Sam Dalitso Kawale, Malawi’s minister of agriculture.

Russian President will not attend BRICS Summit (SAnews)

The Presidency has confirmed that President of the Russian Federation Vladimir Putin will not attend the 15th Summit of BRICS - however, the Russian Federation will be represented by Foreign Minister Sergey Lavrov. “By mutual agreement, President Vladimir Putin of the Russian Federation will not attend the Summit but the Russian Federation will be represented by Foreign Minister, Mr Sergey Lavrov,” the Presidency said on Wednesday.

President Ramaphosa has in recent months and weeks held a number of consultations on the hosting of the Summit. The President’s most recent consultation in this regard took place on Tuesday night at the BRICS Political Party Dialogue in Gauteng.

This will be the first BRICS Summit to be hosted in person since the emergence of the COVID-19 pandemic and the subsequent global restrictions.

Multi-Year Expert Meeting on Transport, Trade Logistics and Trade Facilitation, tenth session (UNCTAD)

Trade facilitation reforms have been advancing considerably in recent years, in particular with the entry into force of the Agreement on Trade Facilitation of the World Trade Organization in 2017 and the inclusion of dedicated trade facilitation provisions in many regional trade agreements.

The implementation of trade facilitation reforms is challenging, as evidenced by experiences in implementing the Agreement on Trade Facilitation. In particular, developing countries and vulnerable economies, such as the least developed countries, landlocked developing countries and small island developing States, are required to address many trade facilitation implementation issues at the same time, and often embark on trade facilitation reforms from a less advanced starting point, thus facing the need for knowledge acquisition and the need to make policy and implementation decisions, as well as funding requirements related to all issues, in a relatively short time frame.

The tenth session of the Multi-year Expert Meeting on Transport, Trade Logistics and Trade Facilitation provides an opportunity to reflect on the key issues at stake, review good practices, provide recommendations on the best way forward, identify priority action areas, in particular for the most vulnerable group of countries, among these the least developed countries, landlocked developing countries and small island developing States, and define the role of relevant stakeholders, including from government, industry, the public and private sectors, development partners and financial institutions.

African Union expresses ‘regret’ over Russia’s exit from Ukraine grain deal (The Straits Times)

The African Union (AU) expressed “regret” on Tuesday over Russia’s decision to suspend a deal allowing safe passage for grain cargo ships from Ukrainian Black Sea ports. “I regret the suspension of the Black Sea Grain Initiative for which the African Union had been an early advocate,” AU Commission chair Moussa Faki Mahamat said on his official Twitter account.

“I urge parties to resolve any issues to resume the continued safe passage of grains & fertiliser from Ukraine and Russia to where it is needed, particularly in Africa.”

On Monday, Russia refused to extend that agreement, threatening to cut off already reduced food supplies on which vulnerable populations in grain importing nations are dependent. Humanitarian groups say it will be acutely felt in many parts of Africa, which is heavily reliant on grain from Russia and Ukraine, and where millions of people are already facing crisis levels of hunger.

MDBs need to provide $260 bn more annually to fund sustainable infra projects: G20 expert group (Devdiscourse)

Multilateral development banks (MDBs) need to provide an additional USD 260 billion annually to fund sustainable infrastructure and help nations achieve SDG targets, a G20 expert group report said. According to the report titled ‘Strengthening MDBs: The Triple Agenda’, additional spending of some USD 3 trillion per year is needed by 2030, of which USD 1.8 trillion represents additional investments in climate action, mostly in sustainable infrastructure, and USD 1.2 trillion in additional spending to attain other sustainable development goals (SDGs).

‘‘MDBs should provide an incremental USD 260 billion of the additional annual official financing, of which USD 200 billion in non-concessional lending, and help mobilise and catalyse most of the associated private finance,’’ the report said.

The report further said that the international development finance system should be designed to support this spending by providing USD 500 billion in additional annual official external financing by 2030, of which one-third in concessional funds and non-debt-creating financing and two-thirds in the form of non-concessional official lending.


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