tralac Daily News
Uganda-South Africa trade summit discusses value addition (The Independent Uganda)
Day one of the Uganda-South Africa Trade and Investment Summit organized by the Government of Uganda, MTN Group, Absa Bank Uganda and various South African owned business entities kicked off at Speke Resort Munyonyo. The discussions were focused on how to improve relations between the two countries with the aim of enhancing bilateral trade and ultimately economic growth.
“We foresee key opportunities to trade among each other reinforced by the Africa Free Continental Trade Area (AFCFTA) to achieve the vision of the Africa we want by 2063 and work together to exploit our rich African natural resources to take advantage of economic opportunities abounding within the African population which currently stands at a billion citizens and growing. Strengthening bilateral trade creates a solid basis for the AFCFTA,” Angela Thokozile Didiza, the Minister of Agriculture, Land Reform and Rural Development said.
“Key to enhanced trade is the need to establish enabling policies and the need for the business community to understand policies and laws in each country that support trade and investment including land tenure, licensing, tax laws and other compliance matters that companies must adhere to. We also need to ensure that there is supporting infrastructure, financing, and mechanisms for conflict resolution and mediation to address mistrust and problems that may arise,” said Angela Thokozile Didiza.
GDP records 0.6% growth in Q2, but loadshedding threatens gains (Engineering News)
South Africa’s gross domestic product (GDP) increased by 0.6% in the second quarter on a seasonally adjusted basis, which North West University Business School Professor Raymond Parsons says is welcoming news. He notes that GDP has extended its gains for a second consecutive quarter, demonstrating a noteworthy degree of resilience in the economy.
He adds that this has mainly been the outcome of more moderate Eskom loadshedding in June compared with April and May. Nonetheless, there remains a high degree of volatility in the growth dynamics, which is apparent in the wide divergence in growth forecasts for the second quarter, ranging from 0.1% to 0.7%.
“It is a reflection, not only of the difficulties in quantifying the biggest supply obstacles in the economy, but also of being a significant source of uncertainty in growth expectations,” Parsons states. For now, the balance of risks to growth prospects remains on the upside.
Kenyan facility ready for Tanzania gas delivery (The East African)
Kenya has completed the transaction for revamping the defunct state-owned Kenya Petroleum Refineries Ltd (KPRL), paving the way for a gas pipeline from Dar es Salaam to Mombasa. Davis Chirchir, the Kenyan Cabinet Secretary for Energy and Petroleum, said a consultant has completed a feasibility study that leads to the signing of a transnational agreement of the project.
“The defunct KPRL will now be under KPC (Kenya Pipeline Company) and the Mombasa-Dar es Salaam pipeline project, is key to feed into the facility to ensure maximum use,” said Mr Chirchir. “We hope once the 30,000 metric-tonne gas facility which is under construction in Changamwe is complete, the project will move to the next stage.”
In October last year, President Samia and President William Ruto agreed to speed up construction of a natural gas pipeline designed to increase trade and lower energy costs for both countries. The estimated cost of the 600-km pipeline is $1.1 billion.
Key mineral developments to boost one million jobs by 2025 (Pulse Uganda)
The government expects to increase jobs in the minerals sector by 63% (2.6 million) in FY2024/2025 from 1.6 million reported in 2017/2018, according to Peter Lokeris, the State Minister of minerals at the Ministry of Energy and Mineral Development.
He said the country’s discoveries of various mineral resources including copper, nickel, gold, chromite, iron ores, tin, tantalite, tungsten, limestone, marble, graphite, gemstones, and rare earth minerals led to an increase in Foreign Direct Investment in the sector from US$ 5 million in 2003 to over US$800 million in 2017.
Uganda Vision 2040 envisions a minerals sector that is a major driver of employment creation and GDP growth. “Planning and investing in mineral development should be undertaken to realise the sector’s vast potential and returns to the economy. These returns include direct revenue, job creation, and upward and downward linkages to other sectors of the economy including industrialisation, agriculture, and human capital development,” he said.
The mineral licenses have since increased from about 100 mineral licences in 2003 to 556 licences, including 249 exploration licences, eight retention licences, 48 mining Leases, and 76 location licences as of June 2023. This increase in licenses in the mineral sector is accompanied by a corresponding increase in income and revenue from the sector, Lokeris said.
The Tanzanian government has abandoned a study of rules that would have benefited the contentious deal with DP World. On Tuesday, Attorney General Eliezer Feleshi said that the government has withdrawn proposed modifications to two laws controlling Tanzania’s natural resources that were up for debate in the National Assembly.
Parts 4 and 5 of the Bill proposed amendments to the Natural Wealth and Resources (Permanent Sovereignty) Act and the Natural Wealth Resources (Review and Re-negotiation of Unconscionable Terms) Act, both of 2017, to ensure that neither act could be used to “prejudice the performance of sea, dry, and lake ports in Tanzania.”
According to the plan, the changes will “enable Tanzania’s ports to operate at international standards level and attract more countries, more ships, and larger cargoes.”
Nigeria’s government will avoid taking on new debt and instead turn to the private sector to drive the economy, finance minister Wale Edun said while unveiling a sweeping agenda to boost growth.
The economy of Africa’s biggest oil producer last looked stable about a decade ago during the global commodity prices boom that sent oil prices soaring but the economy has since slowed, Edun said in a statement on Friday broadcast on television. At the time, the government had enough foreign exchange from oil exports of over over $80 billion to provide the funding for growth of the economy but now earns around $25 billion annually, he said.
“Clearly, the federal government is not in a position to borrow at this time. Rather, the emphasis has to be on creating a stable, macroeconomic environment.” Nigeria’s economic growth rate dropped to 2.51% in the second quarter from 3.54% in the same period last year.
Trade flow along the Zambia – Tanzania corridor is set for better times once a Euros 2.638 million project to upgrade the Tunduma border post is completed. The project which is being implemented through a sub delegation agreement between COMESA and the government of Tanzania kicked off on 15 August 2023 when the site was handed over to the contractor.
The upgrades will also include installation, configuration and commissioning of ICT equipment such as desktops, laptops, printers and smart gates among others. This development is being done through COMESA with support from the European Union 11th Development Programme. The EU is funding the upgrading of selected corridors and border posts in the COMESA-EAC-SADC Tripartite bloc.
The COMESA-Tanzania sub-delegation Agreement is worth Euros 2.638 million and covers the construction of a market for small-scale cross-border traders at Majengo and various priority infrastructure interventions. All these are being implemented under the Trade Facilitation Programme (TFP).
African Climate Summit
New Research shows Africa needs Ten-Fold Increase in Funding for Climate Adaptation (Global Center on Adaptation)
New research from the Global Center on Adaptation released today shows that climate adaptation finance flows to Africa must increase up to tenfold to over US$100 billion per year by 2035 to build resilience against the growing impacts of climate change. Without such investment, it is estimated that the continent could lose out on as much as USD$6 trillion of economic benefits by 2035 as every $1 invested in adaptation has been shown to generate a return between USD$2 and USD$10.
Africa’s Nationally Determined Contributions (NDCs) currently estimate the continent requires US$52.7 billion a year for adaptation (or 2.5% of its GDP) but this new research reveals this is a vast underestimate as only half of the NDCs (28) calculate costs for adaptation.
Africa only received US$11.4 billion in adaptation finance in 2019-2020 and the increase in 2021-2022 is likely to be modest. At this rate, Africa will receive US$182 billion by 2035 for climate adaptation, less than one-tenth of the up to US$1.7 trillion by 2035 the new research estimates it needs.
Ten African countries (Egypt, Morocco, Kenya, Nigeria, Ethiopia, South Africa, Mozambique, Cote d’Ivoire, Tunisia and Ghana) currently receive over half of the continent’s adaptation finance whilst the ten most climate-vulnerable countries (Guinea-Bissau, Sierra Leone, South Sudan, Nigeria, Democratic Republic of Congo, Ethiopia, Eritrea, Central African Republic, Chad, Senegal) only receive 18% of Africa’s adaptation finance.
This roadmap proposes key actions towards realizing an ambition of the African Union Climate Change and Resilient Development Strategy and Action Plan (2022–2032) to “Enhance coordination between the Regional Economic Communities and Member States in addressing and managing transboundary and cascading climate risks”.
The authors of the roadmap recommend that the African Union Commission (AUC) and key partners develop an implementation plan to realize the commitment to “Enhance coordination between the regional economic communities and Member States in addressing and managing transboundary and cascading climate risks”, as established in the African Union Climate Change and Resilient Development Strategy and Action Plan (2022-2032).
Africa, which has suffered climate change impacts the most, must accelerate climate action through effective strategies to ensure a just transition, the Economic Commission for Africa (ECA) Acting Executive Secretary, Antonio Pedro has challenged leaders.
“The lack of the right global enabling environment and strong global action on climate would lead to dire consequences for all of us,” Mr. Pedro, said, in closing the three-day 11th Conference on Climate Change and Development in Africa (CCDA), which concluded with technical inputs for the 4-6 September Africa Climate Summit also being held in Nairobi, Kenya.
Reiterating that without effective strategies at country level and governments not taking responsibility for converting the immense potential of the continent into tangible benefits for its people, Mr. Pedro said Africa risks being left behind in a world undergoing an unjust transition.
The 2022 Africa Agriculture Status Report (AASR23) was launched today with the message that the repercussions of inaction are not just confined to hunger and malnutrition but extend to economic, social, and environmental domains, with the potential to undermine the progress made over the years. The new study titled “Empowering Africa’s Food Systems” underscores the need to address the challenges affecting African food systems considering the imminent threat posed by climate change, and the potential consequences of inaction.
While African governments are committed to tripling intra-African trade in agricultural commodities and services by 2025 as part of the 2014 Malabo Declaration, the aspiration is far-fetched as this kind of trade continues to dwindle from its peak in 2013 to less than 15 percent in 2022. However, if fully implemented, the African Continental Free Trade Area (AfCFTA) could raise household income by 9% by 2035 while lifting 50 million people out of extreme poverty. Africa could see foreign direct investment increase by between 111% and 159% under the AfCFTA.
The Report offers a deep dive into the underlying challenges that have historically held back the potential of the continent’s vast natural resources. Overall, despite progress in food production, processing, and distribution, significant challenges and failures persist leading to an alarmingly poor state of food and nutrition security across the continent. The Report unveils a multifaceted web of challenges that stretch from production to consumption. While daunting, these challenges provide a clear call for a concerted response from governments, the private sector, communities, and individuals alike.
Africa needs more coherent agricultural policies (Myjoyonline)
Opening Remarks for The High-Level Opening of the Ministerial Session by H.E. Amb Josefa Sacko Commissioner for Agriculture, Rural Development, Blue Economy and Sustainable Environment at Africa Climate Summit (AU)
Emerging countries need women-led climate action (The Hindu)
Several ECOWAS experts-members of the ECOWAS Community Committee for Technical Regulation (ECOREG)- are hosting a meeting in Lomé. Started on September 4, the 3-day gathering aims to validate 14 proposed application regulations concerning four value chains: mango, cassava, textile and clothing, and Information and Communication Technologies (ICT).
According to Agence Togolesse de Presse, during the meeting, four Technical Harmonization Working Groups will deliberate over their respective value chains. For “Mango,” they will address technical specifications for both fresh mangoes and their derivatives. For “Cassava and its derivatives,” discussions will cover pesticide dosages and heavy metals in tubers, alongside quality inspection procedures and environmental standards. “Textiles and Clothing” and “ICT” sectors will also be reviewed, with the latter focusing especially on personal data protection and cybersecurity.
The Economic Community of West African States adopts a regional strategy to accelerate the implementation of the African Continental Free Trade Area Agreement in the ECOWAS region and leverage on opportunities for growth and prosperity in the region.
The 90th Session of the Economic Community of West African States (ECOWAS) Council of Ministers endorsed the ECOWAS Implementation Strategy for the African Continental Free Trade Area Agreement on the 6 and 7 July 2023, in Bissau, Guinea-Bissau. This step follows the Strategy’s adoption by ECOWAS Ministers of Trade and Industry (ECOMOTI) at the 3rd Ministerial meeting which was held on the 27th and 28th April, in Abidjan Cote d’Ivoire.
The ECOWAS Commission developed the ECOWAS Implementation Strategy for the AfCFTA to effectively integrate West African economies into the continental market, by building on the progress and success of regional integration in West Africa in order to better take advantage of the economic gains of a common African Market.
“The ECOWAS AfCFTA Strategy for the Implementation of the AfCFTA is an important milestone in the region’s efforts to fast-track the implementation of the AfCFTA Agreement” said Massandjé TOURE-LITSE, Commissioner for Economic Affairs and Agriculture at the ECOWAS Commission “The Commission is committed to working with Member States to ensure that the Community and its people and business can fully benefit from the African Market.
East African Community (EAC) ministers and the business community have urged member-states and the bloc’s secretariat to commit to an increase of 40 per cent in regional trade over the next five years. This is one of the resolutions of the second East African Business and Investment Summit and Expo held in the Ugandan capital, Kampala.
The summit which closed on September 1 discussed successes and challenges facing trade and investments within the EAC and the African Continental Free Trade Area (AfCFTA), with the objective of identifying necessary policy reforms and leveraging opportunities for increased intra-African trade and investment.
Intra-EAC trade grew by 11.2 per cent to $10.9 billion in 2022 up from $9.8 billion the previous year. The region’s total trade increased by 13.4 per cent to $74.1 billion in the same period. According to a statement released following the summit, the EAC leaders and business people agreed to “prioritise harmonisation of trade and investment regulations and policies within the EAC to facilitate promotion of EAC as a single investment destination.”
Among their resolutions is the establishment of a fund for small and medium enterprises (SMEs) and start-ups to facilitate their access to finance.
China’s Multilateral Trade With BRICS and Africa Show Significant 7M 2023 Increases (Silk Road Briefing)
China’s imports and exports with other BRICS members expanded 19.1% year on year to ¥2.38 trillion (about US$330.62 billion) between January and July 2023, according to statistics from the Chinese General Administration of Customs.
China’s trade with Africa is also increasing and rose 7.4% during the same January-July 2023 period to ¥1.22 billion over the 2022 figure of ¥1.14 trillion yuan (@158.36 billion U.S. dollars). That growth continues from the previous year, which had increased by 14.8% over 2021. South Africa, a BRICS member is China’s largest trade partner in Africa, followed by Nigeria and Angola.
China is the Africa’s largest export destination. In the past seven months, the nation imported ¥426.65 billion worth of goods from Africa, including crude oil, iron ore and copper. In the same period, China’s imports of agricultural products from Africa increased 20% to reach ¥ 23.66 billion.
To compare, China’s bilateral trade with the United States during this period was US$324.9 billion, meaning that China’s BRICS trade has marginally overtaken its trade with the United States.
With an expanded BRICS from January 2024 to also include Argentina, Egypt, Ethiopia, Iran, Saudi Arabia and the UAE, the collective BRICS will carry more trade clout in Beijing than Washington.
WTO Chief Criticizes Rich Nations for Embrace of Protectionism (Bloomberg BNN)
The head of the World Trade Organization sharply criticized western governments for embracing protectionist policies and shifting toward a power-based global trading system.
“Recent unilateral protectionist measures by some developed countries coupled with a more general reticence about the multilateral trading system and the WTO is seen as cynical and hypocritical by developing countries,” WTO Director-General Ngozi Okonjo-Iweala said Monday at a conference in Berlin. “The latter feel that rich countries who have benefited immensely from the multilateral trading system to develop their economies now no longer want to compete on a level playing field and would prefer instead to shift to a power-based rather than a rules-based system,” she said.
“The right response is to de-concentrate, diversify and deepen global trade by bringing more countries and communities from the margins to the mainstream,” she said. “Extending global production and trade networks to Africa, Latin America and Asia would make them simultaneously more resilient to localized shocks and more inclusive in socio-economic terms.”
G20 culture ministers met in the Indian city of Varanasi – also known as Kashi – culminating in the release of the “Kashi Cultural Pathway” on 26 August. This outcome document pledges G20 support to fortify cultural and creative industries, particularly in developing countries, drawing on expertise from international organizations including UNCTAD.
The G20 comprises the world’s largest economies, making up around 85% of the global GDP and over 75% of world trade. “We at UNCTAD attach great importance to cultural and creative industries because of their profound implications for trade and development and their transformative power across the economic, social and environmental dimensions of sustainable development,” UNCTAD Secretary-General Rebeca Grynspan says.
Amid the myriad challenges facing the world – from post-pandemic recovery to an expanding digital divide – the creative economy is ripe for innovation, investment and trade, promising a feasible development option especially for developing countries.