tralac Daily News
South Africa’s agricultural exports amounted to $3.4 billion (R64bn) in the second quarter of this year, up by 0.1% year-on-year, according to data from Trade Map.
While South Africa’s agricultural exports in the first half of the year had been encouraging, the export earnings would likely soften this year from last year’s record, the Agricultural Business Chamber (Agbiz) said on Monday.
Agbiz chief economist Wandile Sihlobo said despite challenges in key export markets such as the EU in the case of citrus, the products that dominated the export list this quarter were citrus, maize, apples and pears, wine, sugar, soybeans, wool, avocados, pineapples, fruit juices, nuts, and grapes.
“Importantly, this good export performance was not only a function of price but also improved volumes. The prices of some agricultural products have declined notably from the 2022 levels,” Sihlobo said.
New report highlights how imported cement destabilises the economy (Engineering News)
The negative impact on the South African economy caused by substituting local cement production with imported cement was highlighted in a report released by cement manufacturer PPC in conjunction with the Centre for African Management and Markets (CAMM) at the Gordon Institute of Business Science (GIBS), in Johannesburg, on September 13.
The report provides an overview of PPC’s contribution to the South African economy and forecasts the potential social and economic impacts of a significant displacement of local cement production in favour of imported cement.
“The report tangibly demonstrates the serious and complex threats that cement imports pose to our industry, society, and country’s development,” PPC South Africa and Botswana MD Njombo Lekula said. The report shows a potential R2.6-billion-a-year loss in economic value in an already-strained economic environment. The report shows that PPC was a major economic contributor in South Africa, with the business’ operations adding about R8.8-billion to the national gross domestic product (GDP) last year through its value chain – equivalent to 0.13% of the country’s total GDP.
Mutorwa ties railway to trade in Africa (New Era)
If Namibia is to reap maximum returns from the African Continental Free Trade Area (AfCFTA), it has to invest heavily in railway infrastructure, works minister John Mutorwa has said. He was referring to the envisaged railway lines to transport goods from the Port of Walvis Bay to the rest of Africa and vice versa .”We don’t have any alternative if we are talking about inter-Africa continental trade; those are the facilities that we need,” he said during a media briefing at Rundu last week.
“The conclusions of the feasibility study consultants are that this railway line, if everything, as recommended, is implemented, is viable. They have done the environmental assessment studies also, looking at the environment and how that railway line will impact the environment here and through the game park,’’ he said.
Now, the big issue from here on is the funding, he said, noting: “The ministry of finance is more in the lead now but we are also there to see how we are going to fund this because it is not only a Namibian railway line.
Nigerian importers to begin clearing goods from Cotonou border (Premium Times Nigeria)
The Nigerian government announced Tuesday that Nigerian importers would soon be free to legally import their goods from the ports in Cotonou, Benin Republic. The acting Comptroller-General of the Nigeria Customs Service (NCS), Bashir Adeniyi, disclosed this while speaking to journalists after a two-day working visit of Alain Hinkati, Director-General of Customs, Republic of Benin, to Nigeria.
In August 2019, the federal government ordered the closure of land borders to halt smuggling along the borders. However, the government in 2021 opened border points across the country, Seme, in the South-west, Ilela and Maitagari in the North-west, and Mfun in the South-south. The government maintained that the ban on the importation of rice, poultry, and other products still subsists.
Speaking on Tuesday, Mr Adeniyi said the decision to set up a clearing point for Nigeria-bound goods was one of the highlights of the two-day working visit of the Director-General of Customs, Republic of Benin, to Nigeria.
“We are building confidence in the system offered by the Republic of Benin. Our importers are using their ports and vice-versa. If there are people in the Benin Republic who want to use our ports, we try to build trust in our systems.” By this agreement, what it means is that Nigerian importers willing to use the ports in Cotonou can have their goods cleared in those ports because there would be an opportunity for them to pay duties on goods that are liable for payment of duties. He explained that the NCS is currently in the final stages of integrating its IT systems with the Federal Road Safety to curb illegal entry of vehicles.
Kanayo Awani, the executive vice-president of African Export-Import Bank (Afreximbank), says the financial institution plans to increase its intra-African trade financing to $40 billion. Awani said Afreximbank plans to hit the mark by 2026 as it continues to support the Africa Continental Free Trade Area (AfCFTA) initiative. She disclosed this on Monday, at the 2023 intra-African trade fair (IATF) business roadshow in Lagos, according to NAN.
As of 2021, Awani said, Afreximbank’s intra-African trade fund stood at $20 billion, noting that with the bank improving its backing of African trade and investments, there would be a 100 percent increase in six years. She also said part of the financial backing earmarked for intra-African trade is $1 billion to support the funding of the AfCFTA, and a $10 billion grant to facilitate the establishment and operation of the adjustment fund.
“We are also partnering with the AfCFTA Secretariat and AU to ensure a successful implementation of the Pan-African Payments and Settlements System (PAPSS), with the view to facilitating the payment and settlements of trade transactions in local currencies,” the executive vice-presidents said. “This will address the challenge of currency inconvertibility and foreign exchange shortages that hamper intra-African trade.”
Also, to address the challenge faced during the transportation of goods across multiple borders in Africa, she noted that the bank created the Afreximbank African collaborative transit guarantee scheme, using technology-enabled transit bonds to ensure seamless movement of goods. According to Awani, the bank also created the African trade facilitation programme (AFTRAF) to support its intra-African trade financing.
Difficulties in securing foreign currencies and lack of affordable credit in the wake of rising interest rates are major challenges facing traders in the East African Community, a report indicates. These add to delays in payments by government for supplied goods and services (pending bills), securing government tenders and obtaining tax refunds, tax appeals, rulings, and customs valuation.
According to the Report on the Ease of Doing Business in the EAC 2023 by the East African Business Council (EABC), on behalf of the Germany Corporation for International Cooporation (GIZ), there is also persistent cross-border restrictions and high trading costs which are hurting intra-EAC trade.
While EAC has harmonised tariffs and pushed for the ease of movement, traders are still facing challenges which vary from country to country. This is despite the region experience steady increases in trade volumes in post-Covid era, driven by reopening of economies and demand for goods and services. The region’s currencies also remain exposed to the strengthening US dollar with traders struggling to secure enough dollars for trade, amid low usage of local currencies for payments.
Intra-EAC trade, accounting for imports and exports in the seven EAC partner states, grew from 13 per cent in 2019, valued at $7.1 billion (Sh1.04 trillion), to 15 per cent in 2021, valued at $9.5 billion (Sh1.4 trillion). By September 2022, EAC’s trade value reached $10.17 billion (Sh1.5 trillion), official data shows, representing a 20 per cent share of intra-trade within global trade, which stood at $62 billion (Sh9.1 trillion).
“Despite this progress, persistent Non-Tariff Barriers and protectionist tendencies by EAC Partner States have been identified as key factors hindering the growth of intra-EAC trade,” the report reads in part.
SADC Gas Long-Term Economic Growth (Energy Capital & Power)
The shift signifies the growing recognition of gas as a stable, long-term energy source, rather than a transitional solution. In Mozambique for example, a strong portfolio of Liquefied Natural Gas (LNG) projects aim to advance regional energy security while generating critical revenue for the country via exports.
Meanwhile, in Namibia, offshore success seen by energy majors such as Shell have underscored the long-term potential of gas for the region in terms of energy supply and economic progress. In South Africa, emerging helium and natural gas producer Renergen’s pioneering efforts highlight the potential of harnessing onshore gas for long-term security. The company’s onshore Virginia Gas Project represents a step towards reducing energy import dependency and promoting sustainable practices within South Africa.
Renergen believes that helium will be a game changer for South Africa, and is expected to play a crucial role in global markets, contributing to the development of semiconductors and microchips for example.
Regional infrastructure experts led by Permanent Secretaries from the 21 COMESA Member States have begun meeting in Kigali, Rwanda, today to review progress on the implementation of the ongoing priority projects. The two-day meeting is the 13th of the Joint Technical Committees on Transport and Communications, Information Technology and Energy.
Among the key projects under implementation include Regional Infrastructure Financing Facility Project, the Tripartite Transport and Transit facilitation Programme, the Establishment of the Navigation Line between Lake Victoria and the Mediterranean Sea Project, the Support to Air Transport Sector Development Programme, the Enhancement of the Governance and Enabling Environment in ICT Sector among others.
While addressing the delegates, Assistant Secretary General in charge of COMESA programmes, Dr Mohamed Kadah, called for innovative ways of financing infrastructure development, through public private partnership, given the prevailing high financing gaps. “Africa needs adequate infrastructure to ensure reliable energy, efficient transport, reliable communication systems, resilient sanitation and affordable housing. And indeed, Africa’s vast infrastructure deficit is a huge impediment to economic growth and regional integration,” noted Dr Kadah.
Ghana remains committed to the Economic Community of West African States (ECOWAS)’s single currency agenda despite the current economic challenges facing the country, Chief Director of the Ministry of Finance, Ms. Eva Esselba Mends, has said. She said the country’s economic challenges would be reversed and sustained macroeconomic stability re-established.
Mrs Mends stated this at the 53rd meeting of the Technical Committee of the member states of the West African Monetary Zone (WAMZ) as part of the 2023 Mid-Year Statutory Meeting of the West African Institute for Financial and Economic Management (WAIFEM), West African Monetary Agency (WAMA) and West African Monetary Institute (WAMI), which began on September 5, 2023 and would end on September 15, 2023 and being hosted by the Ministry of Finance under the auspices of the Bank of Ghana.
The Chief Director of the Ministry of Finance said Ghana’s economic growth remained positive despite the significant impact of multiple crises, such as the COVID-19 pandemic, Russia-Ukraine war. “Government remains focused and resolute on restoring macroeconomic stability. Ghana, like many other economies, continues to contend with record-level inflationary pressures. Nonetheless, outlook in the near-term is positive as inflation has peaked,” she stated.
The Chief Director stressed that in spite of the economic crises facing the ECOWAS region, such spiralling inflation, growing public debt and political instability, the region must “Urgently and deliberately pursue the economic integration of our sub-region and rake in the extensive benefits for our peoples”.
The Economic Community of West African States, ECOWAS has said it is set to perfect the design for Abidjan-Lagos Highway Development Project for implementation. The Commission disclosed this in Lagos yesterday, at the opening ceremony of the ongoing three-day workshop it organised to meet the relevant stakeholders for the necessary validation.
Head of Roads and Railyway at ECOWAS Commission, Mr Ashoke Maliki, said: “Today’s event is important because member states comprising of Nigeria, Benin Republic, Togo, Ghana and Cote d’Ivoire are here to look at the report presented by the consultant, validate it based on their experiences along the corridor and approve such report for investment.”
“By the end of this year, we would have been done with the design which includes Environmental Assessment ESIA, engineering design, project scoping and tender document,” he said.
The Economic Community of West African States adopts E-commerce Strategy to support Member States in leveraging e-commerce to build resilient micro-small and medium sized enterprises, create new jobs and spur economic diversification.
The 90th Session of the Economic Community of West African States (ECOWAS) Council of Ministers endorsed the ECOWAS E-commerce Strategy at its last meeting held from the 6 – 7 July 2023. This step follows its adoption by ECOWAS Ministers of Trade and Industry (ECOMOTI) at the 3rd Ministerial meeting which held from the 27th – 28th April, in Abidjan Cote d’Ivoire.
The ECOWAS Commission developed the E-commerce Strategy (ECS) with the support of the United Nations Conference of Trade and Development (UNCTAD) with the objective to strengthen the efforts of ECOWAS Member States on the use of technology to accelerate structural change and development, foster regional integration, including through economic diversification, job creation and more inclusive trade activities.
With the vision for a “sustainable, inclusive, and secure e-commerce ecosystem supportive of ECOWAS’ efforts to use technology to accelerate structural change and foster regional integration through economic diversification and job creation.” The Strategy aims to strengthen ministries of trade to support domestic and cross-border e-commerce development, secure trust along the e-commerce supply chain from producers to consumers, improve access to e-commerce statistics and market information in ECOWAS, and foster inclusion for e-commerce development in ECOWAS.
Despite new international challenges, poor harvests, and the price shocks of 2022, many countries in Sub-Saharan Africa saw improvements in their social inclusion policies and their structural policies—both of which are reflected in the latest Country Policy and Institutional Assessment (CPIA) scores for 39 countries in the region.
Countries are rated on a scale of 1 (low) to 6 (high) across 16 dimensions reflecting four areas: economic management, structural policies, policies for social inclusion and equity, and public sector management and institutions. The average overall CPIA scores in SSA remained stable at 3.1. While many countries made improvements in “policies for social inclusion” and “structural policies”, these improvements were offset however by stagnation in “economic management” and “public sector management and institutions.”
“At a time of high global interest rates and weak economic growth, it is encouraging to see progress in policy reform, especially around private-sector reforms and protecting vulnerable people from economic fluctuations,” said Nicholas Woolley, economist with the World Bank Office of the Chief Economist for Africa.
In 2022, the gap between sub-regions grew, as Western and Central Africa (AFW) continued its upward trend, improving scores slightly from 3.2 to 3.3, while Eastern and Southern Africa (AFE) remained unchanged at 3.0. However, this gap can largely be attributed to the performance of fragile and conflict-affected states (FCS). In 2022, the four lowest-scoring countries (South Sudan, Eritrea, Somalia, and Sudan) were located in AFE and were experiencing conflict and fragility. Without these four states, the score between sub-regions is almost identical.
The 7th Korea-Africa Economic Cooperation (KOAFEC) Ministerial Conference opened in Korea’s second-largest city, Busan, on Wednesday with a strong call for additional resources to help African countries achieve universal access to energy and transform the continent into the breadbasket of the world.
The conference is taking place at a time when Africa is facing a plethora of challenges. This is why Korea and African nations, under the aegis of KOAFEC, have agreed to deepen their cooperation with much more emphasis on mutually beneficial investment.
The African Development Bank Group and the Ministry of Economy and Finance of the Republic of Korea are co-hosting the three-day conference under the theme “Embracing a Sustainable Future: Just Energy Transition and Agricultural Transformation in Africa.” This embraces these two critical development priorities for Africa.
In his opening remarks, African Development Bank Group President Akinwumi Adesina urged delegates to seize the conference as a critical opportunity to galvanise support for several objectives: achieving universal energy access in Africa, advancing a just energy transition and transforming the African continent into the breadbasket of the world.
“Doing so will require additional resources,” Adesina said. The African Development Bank chief urged Korea to join other countries that have expressed strong interest in reallocating SDRs to the African Development Bank Group. “This will be a game changer for Africa’s development,” Adesina declared.
Choo summarised Korea’s priority areas for support to Africa as “ABC”—agriculture, bio-health, and climate change, as well as energy transition. He said Korea also planned to significantly increase its official development assistance.
The World Trade Organisation, WTO, revealed that Increasing regional trade integration could promote both overall economic performance and integration into the global market beyond commodities trade by 29 % in 2035.The WTO disclosed this in its World Trade Report 2023, viewed by Nairametrics on Tuesday, titled “Re-globalization for a secure, inclusive and sustainable future”
The report revealed that for Africa, increasing regional trade integration could promote both overall economic performance and integration into the global market beyond commodities trade.
“For example, the full implementation of the African Continental Free Trade Area (AfCFTA) could lead to an additional 29% increase in total exports by 2035. Intra-African exports could surge by 81%, while exports to the rest of the world would also rise by 19%.
“The manufacturing sector would particularly benefit from a reduction in tariff and non-tariff barriers, with a projected 62% increase in exports. “As trade in manufactured goods allows for greater diversification than commodities trade, this would help African economies to further integrate into GVCs. Export diversification could also be greater in similarly endowed economies engaging in trade.”
At their third meeting since the onset of the COVID-19 pandemic, the Directors-General of WHO, WIPO and the WTO agreed to shift the focus of trilateral cooperation from the response to the COVID-19 pandemic to increasing and broadening support for more effective and sustainable use of flexibilities in the WTO Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) to increase access to health technologies and to be better prepared for future pandemics.
While acknowledging the critical role of intellectual property (IP) to incentivize innovation, WHO Director-General Dr Tedros Adhanom Ghebreyesus, WIPO Director-General Daren Tang and WTO Director-General Dr Ngozi Okonjo-Iweala recognized the challenges faced by members to fully implement at domestic level the wide range of available options to secure timely and equitable access to health technologies.
This included the TRIPS COVID-19 Vaccines Decision adopted at the WTO’s 12th Ministerial Conference in June 2022 as well as flexibilities generally available under the TRIPS Agreement. They agreed that trilateral cooperation should address these challenges by intensifying activities to provide tailored support and information to members, including through joint technical seminars for delegates handling health, trade and IP issues.
Wealthier nations, who are historically more responsible for climate change, are failing to meet the international climate funding obligations they agreed to in Copenhagen in 2009, stated the recently published new report on “Fair Share” by ODI and Zurich Flood Resilience Alliance. A target of providing $100 billion a year in climate finance – agreed by developed nations– has now been missed for the 11th year in a row.
The report is being released following the G20 leaders’ summit in Delhi, held over the weekend, where the G20 countries once again said that they will meet the $100bn goal in 2023. However, only eight developed countries out of 23 currently pay their fair share of climate finance, with the USA, Spain, and Australia continuing to fall hugely short.
ODI report shows, that despite needs amounting to an estimated $4 trillion by 2030 to keep to a 1.5 degree C trajectory, the $100 billion target has been missed every year to date. In 2020, the target should have been reached, provision and mobilization amounted to $ 83.3 billion. Cumulatively over 2011–2020, the climate finance gap totals $409.8 billion. The report mentioned that the failure to meet the climate finance goal can be attributed to developed countries collectively, and this failure has far-reaching consequences.
Beyond merely achieving their ‘fair share’ of the $100 billion target, developing countries must contend with the fact that historically, adaptation funding has been vastly overshadowed by mitigation support. In fact, the underfunding of adaptation is so pronounced that provider countries were implored to double their flows of adaptation finance during the 2021 Glasgow COP. This underscores the pressing need for a more equitable and comprehensive approach to climate finance, one that aligns with the actual needs and priorities of those most vulnerable to the impacts of climate change.
Civil society criticizes African Climate Summit for promoting false solutions, not fossil fuel phaseout (Oil Change International)
Last week, some 30,000 delegates and 25 African heads of state, as well as the European Commission President, UN Secretary-General, and US Special Envoy on Climate, gathered in Nairobi for the inaugural Africa Climate Summit. The event was seen as an opportunity for African countries to agree on a unified position ahead of the upcoming COP28 conference later this year.
The Summit and wider African Climate Week was held from the 4th to the 8th of September. Alongside the summit, some 500 African Civil Society Organisations from across the continent came together for a concurrent Real Africa Climate Summit to put forward community solutions for real climate action.
The language during the summit was bold. Kenyan President William Samoei Ruto said, “Climate action is not a Global North issue or a Global South issue. It is our collective challenge, and it affects all of us. We need to come together to find common, global solutions.”
The response by many activists was highly critical. The People’s Assembly declared that the African Climate Summit “ought to have been the opportunity to put forward a real and progressive stance on African climate action and integrated development in a way that centers African solutions and strategies and breaks from the business as usual of Africa being a pawn in the plans of others.”
The alternative People’s Declaration noted that “Real solutions to climate change cannot be designed in boardrooms and ivory towers – they must come from genuine consultation with people and communities and must put people-centered (not profit-centered) goals at their core.”