tralac Daily News
SARS records R16 billion trade boost for South Africa (BusinessTech)
South Africa saw a preliminary trade balance surplus of R16.0 billion in July 2023, data from the South African Revenue Service (SARS) shows.
SARS said that this surplus was due to exports of R174.0 billion and imports of R158.0 billion, including trade with Botswana, Eswatini, Lesotho and Namibia (BELN). However, the year-to-date preliminary trade balance surplus of R19.5 billion is a massive decline from the R154.6 billion trade balance surplus for the same period in 2022.
According to SARS, China was South Africa’s biggest trading partner in exports and imports.
In a significant development for the global avocado trade, South African avocado growers are about to penetrate the lucrative Chinese market. The journey to secure this market access has been marked by orchard inspections and regulatory approvals earlier in Spring this year.
As early as March, the news emerged that South African avocados were on the brink of being granted access to the Chinese market. In April, Chinese authorities conducted thorough on-the-ground inspections of orchards and farms, including at a few key players like Halls.
The Chinese avocado market is not a mature market yet. “The current season poses a unique challenge for the Chinese avocado market”, says Lifan: “Primarily due to an influx of both Kenyan and Peruvian avocados. This unprecedented supply has caused market prices to fluctuate, impacting not only established players like South Africa but also newer entrants like Kenya. The differences between Kenyan and Peruvian avocados, coupled with various supply chain issues, have influenced market dynamics, which are still very volatile. Prices have come down, which is making it more attractive for smaller traders on the market to add avocadoes to their product portfolio. This will eventually only grow the size of the market”.
Steel industry vital for South Africa’s industrialisation, Majola says (Engineering News)
Trade, Industry and Competition Deputy Minister Fikile Majola has stressed the impact of the local steel industry and its importance to South Africa’s industrialisation, and the challenges that the sector is facing from local and global pressures, emphasising the need to build an “inclusive sector” that contributes to the economy.
“Steel is one of the most important materials in the world. It is present in most aspects of the economy, from transportation and other infrastructure to more simple aspects like containers. Steel is used in the production of colossal structures, as well as small components for precision instruments,” he said in an address at the South African Iron and Steel Institute’s Southern African Steel Summit, held in Johannesburg on August 30. “It is durable, adaptable and endlessly recyclable, making it the start of our journey toward reducing our carbon footprint.”
With tough global economic financial conditions and the rising needs and development priorities that South Africa has, government must better manage its fiscal situation, as well as address its structural issues to ensure the country can be placed on a sustainable growth and debt path. This was the key message conveyed by International Monetary Fund (IMF) first deputy MD Gita Gopinath, during a speaking engagement at the University of the Witwatersrand School of Economics and Finance on August 31.
To improve South Africa’s growth path, with IMF projections showing near-zero growth for the country this year, as well as minimal growth over the medium term, Gopinath averred that the IMF had suggested two areas of focus. Its first recommendation is on the fiscal side. Secondly, Gopinath said the country needed to undertake structural reform and address structural issues.
Used clothing imports ‘to be banned’ in Uganda (letsrecycle.com)
On Friday, it was reported by Ugandan news website Monitor that the president announced a ban on the import of second hand clothes, effective from Friday 1 September, as part of efforts to boost the local textile manufacturing industry. Monitor reported the president saying: “I have declared a war on second-hand clothes to promote African wear. We are going to stop the importation of second-hand clothes to create jobs form textiles factories. Anybody who stands in my way, I will crash him. We will not allow second-hand clothes to enter the country anymore.”
The move will concern textile recyclers and also some local authorities, as if it goes ahead it could impact the demand for used textiles, thus the price paid for textile bank material. It also comes amid growing political tensions in Niger, which could impact imports in West Africa, too.
Fair Trade Africa steadily changing lives of flower farm workers (Capital Radio)
Ann Mbuthia, Administration Manager at Aurum Roses Limited a flower farm company in Entebbe, Wakiso district has encouraged employers in the country not to shy away from equipping workers with multiple hands-on skills fearing that they will resign and venture into other businesses. She says that workers workers will always have choices to make in and outside their known workplaces. Some choose to stay while others continue to seek greener pastures. Mbuthia adds that this should not be reason enough to deny them opportunities.
In an exclusive interview with Capital Radio, Mbuthia further explains that at Aurum Roses through the Fair-trade Africa initiative, Workers have been furnished with vocational skills and graduated in different courses including tailoring, computer science, and baking among others. This skilling project is aimed at improving their livelihoods but also makes them more helpful in the different communities where they reside.
Uganda’s economy sees impressive growth as trade deficits shrink and exports surge (Business Insider Africa)
The finance ministry’s monthly report on the state of the economy for July 2023 states, “Between May and June 2023, the merchandise trade deficit narrowed by 12.3 percent from $82.08 million to $247.43 million. Year-on-year, the merchandise trade deficit narrowed by 32.2 percent from $365.11 million in June 2022 to $247.43 million in June 2023,” the report shows.
According to an interview with the Ministry Head of Communications Apollo Munghinda, Uganda exported goods valued at $650.57 million in June 2023. “This represented an 11.1 percent increase when compared to $585.81 million exported during May 2023. This increase was mainly on account of higher export earnings from beans, simsim, cotton, and gold registered during the month,” he noted.
Additionally, according to Munghinda, within the same time period, coffee export receipts for the month were $90.56 million, up 23.6 percent from $73.26 million in May 2023. This increase was mostly related to the increased price of Robusta coffee on the international market, which encouraged exporters to remove beans from their warehouses for sale.
The African continent is on the threshold of a new era. African nations have collectively embarked on a path toward deeper trade integration, with the African Continental Free Trade Area (AfCFTA) as a catalyst to unlock this potential and reshape the continent's trade landscape. This ambitious initiative aims to dismantle barriers to trade and create a unified trade landscape across Africa.
We should commend policymakers for this landmark initiative. But realistically, it was in part a response to rising cross-border trade, investment, and financial flows within the region as economic activity strengthened over the years.
In an era of rapid technological change and an evolving global economy, trade integration can enhance Africa’s resilience to shocks and position the continent for long-term success. Digitalization, for instance, can significantly reduce trade costs by streamlining customs processes and facilitating cross-border payments. Electronic cargo-tracking systems and cloud-based payment systems offer a glimpse of technology’s ability to improve trade efficiency. Diversification of export destinations thanks to AfCFTA implementation, moreover, means less risk from shifting global trade patterns and greater economic resilience.
Somalia likely to join EAC 11 years after membership bid (People Daily)
Somalia is finally set to become the latest member state of the East African Community (EAC), almost 11 years after Mogadishu first applied for membership. It has already made a critical step in the negotiations stage and is set become the eighth member of the bloc after Democratic Republic of Congo (DRC) that formally joined in April 2022.
Already, the negotiations for admitting Somalia began on August 2022 and will end on September 5.The final decision regarding Somalia’s admission into the EAC however rests with the Heads of State Summit scheduled for November, according to Dr Abdusalam Omer, the Special Envoy of the President of the Federal Republic of Somalia to the EAC.
AFEX, GCX sign MoU to foster cross-border commodities exchange (Businessday NG)
AFEX, Nigeria’s commodities exchange and Ghana Commodities Exchange (GCX), have signed a Memorandum of Understanding (MoU) to strengthen the commodity trading ecosystem across Nigeria and Ghana. The MoU signing took place at AFEX’s office in Abuja which underscored the commitment to leverage collaboration to effectively transform the agricultural sector.
Under the partnership, AFEX and GCX will collaborate on areas related to commodities trading, warehousing, quality standards, and market infrastructure development. In addition, both organisations will also collaborate on capacity-building initiatives, with both exchanges deploying their resources to facilitate cross-border trading of warehouse receipts and increase market liquidity of commodities.
“This is a significant step towards realizing our shared vision of seamless market integration in Africa’s commodity trading space, and together, we will not only enhance commodities trading and market infrastructure, but also empower farmers and traders through capacity building,” Tucci Ivowi, CEO, Ghana Commodities Exchange stated.