tralac Daily News
Forex shortage challenging intra-Africa trade (Engineering News)
Intra-country trade across Africa is stuttering as businesses struggle to find the foreign currency, most notably the dollar, needed to pay for imports. This shortage has been caused by the depreciation of local currencies, higher interest rates and capital flight in the continent’s developed markets, the latest Standard Bank Africa Trade Barometer (ATB) shows.
This barometer was launched last year to address the information vacuum surrounding African trade data and is now one of Africa’s leading trade indexes, supporting the growth of intra-Africa trade. The fact that most surveyed businesses were small businesses is one of the central value-adds of the publication.
In its third issue, the barometer concentrates on ten countries – Angola, Ghana, Kenya, Mozambique, Namibia, Nigeria, South Africa, Tanzania, Uganda and Zambia. “Although there are many tariffs and other non-tariff barriers inhibiting intra-Africa trade as defined and articulated in the African Continental Free Trade Area (AfCFTA) Agreement, one of the key non-tariff barriers is information. “The ATB is helping address this lack of access to information through up-to-date survey data on the views of African businesses, the environment they operate in, trade behaviour and their perceptions on trade,” says Standard Bank Business and Commercial Clients division head of trade and Africa-China Philip Myburgh.
Seven broad categories are used to construct the ATB Index ranking by collecting data from primary and secondary sources. These categories are trade openness, access to finance, macroeconomic stability, infrastructure, foreign trade, governance and economy and traders’ financial behaviour.
PPC reports 5% y/y growth in South Africa and Botswana cement business (Engineering News)
The revenue for cement manufacturer PPC’s South Africa and Botswana divisions for the five months ended August 31 increased by 5% year-on-year, the company reported in an operating update on September 20. This increase was driven by higher average selling prices, despite weaker cement sales volumes during the period.
Additionally, revenues from the group's other operations in both Zimbabwe and Rwanda were significantly stronger than the previous year, increasing by 58% when measured in dollars and 19% when measured in rands.
Overall, group cement sales volumes, including for the Zimbabwe and Rwanda operations, for the five-month period were 3% higher year-on-year, primarily owing to exceptionally strong growth in Zimbabwe and, to a lesser extent, Rwanda.
SA ports of entry upgrade on the way (defenceWeb)
South Africa’s six busiest ports of entry – all land-based – are in line for an upgrade to make them more people and trade friendly, Home Affairs Minister Aaron Motsoaledi told a media briefing earlier this month (September). The ports of entry earmarked for betterment via development in public/private partnerships (PPPs) are Beitbridge – Zimbabwe; Lebombo – Mozambique; Maseru Bridge – Lesotho; Ficksburg – Lesotho; Kopfontein – Botswana; and Oshoek – Eswatini.
Explaining the redevelopment rationale, the Minister said: “South Africa’s ports of entry were designed during the apartheid era with the primary objective of tightened security while neglecting effective facilitation of regional and international trade. It is not an over exaggeration to state that when you visit our land ports of entry, between us and our SADC (Southern African Development Community) neighbours, the South African side of the border looks like informal settlements while the other side looks like Sandton”.
The redeveloped ports of entry will, according to Motsoaledi, see efficient cross-border management of movement of people, goods and services as well as “improved administration” of people entering and leaving South Africa. He named economic plusses – better regional integration, enhanced support for the African Continental Free Trade Area (AfCFTA); improved revenue collection and “addressing leakages” from illegal movement of goods and illicit financial flows and protecting local industry from harmful imports and exports as well.
On Friday, 22nd September 2023, FAO will conclude a nine-month assessment of Eswatini’s food control system with a final workshop in Manzini where high-level executives are expected to endorse the recommendations of the final report and commit to implementing its strategic plan. The assessment is part of “Strengthening of Capacities and Governance in Food and Phytosanitary Control,” a 5-million-euro project funded by the European Union which began in November of 2022 to provide technical support and work with Competent Authorities and other leading institutions in 11 Common Market for Eastern and Southern Africa (COMESA) Member Countries.
The final workshop will be the culmination of the nine-month assessment. Focal points and stakeholders involved in the country’s food control system from across the country will meet in Manzini from September 19 to 22 to review the findings and recommendations of the assessment, agree on priorities, and develop a strategic framework to facilitate its implementation. The key moment of the workshop will be on September 22 when high-level officials from Ministries across the country’s food safety control system are expected to approve and endorse the recommendations and the shared vision for the food control system, commit to implementing the strategic plan, promoting synergies, and engaging donors.
Zimra to roll out new tax admin system (The Herald)
The Zimbabwe Revenue Authority (ZIMRA) is set to introduce a new tax system next month in a bid to revolutionise the tax administration terrain in the country through an efficient, effective, and easy-to-navigate system based on a digital platform. Known as the Tax and Revenue Management System (TaRMS), it is a product of ZIMRA’s business process re-engineering (BPR) programme launched in 2022. The BPR identified digitalization as the key aspect of improved service delivery to ZIMRA’s diverse clients.
The TaRMS commenced in 2022 following an intensive user needs analysis and assessment. It is being introduced to close the gaps that have historically affected efficient revenue collection. This is also in line with the authority’s shift towards automation and digitalization.
ZIMRA commissioner-general Ms Regina Chinamasa said the advanced automation system expected to go live on October 12 would not only address the revenue collection but also help trade facilitation. It is also expected to address challenges that ZIMRA has been facing including revenue leakages. This is in addition to being more user-friendly, a key enabler for ensuring voluntary tax compliance.
“Faced with the persistent system challenges, ZIMRA benchmarked with good practices in revenue administration and supporting systems and identified system gaps necessitating the modernisation agenda undertaken from 2020,” said Mr Chinamasa during a stakeholder engagement meeting to unpack the new system on Monday.
Uganda has initiated the rehabilitation of key access routes to oilseed projects in 81 locations in an effort to bolster its diminishing edible oil exports. The nation is exploring strategies to revitalise its dwindling export earnings from edible fats and oils, which fell from Shs1.05 trillion in the same period last year to Shs338.2 billion in July 2023.
Uganda has been grappling with the production of this highly sought-after product, with a surge in global demand last year exacerbated by a conflict in Ukraine, one of the world’s leading vegetable oil producers. This conflict disrupted supply chains and inflated prices in the local market. The country currently satisfies less than 40 percent of the demand and is striving to enhance its output by rejuvenating oilseed projects in various districts across the nation, incorporating value addition, and upgrading transportation links to market centers.
Import bill falls for first time since Covid (Business Daily)
Kenya has this year posted a drop in the value of imports for the first time since the Covid-19 pandemic era due to reduced expenditure on key supplies such as materials for factories, machinery and fuel, fresh official data show. Traders spent Sh1.43 trillion on goods ordered from abroad for the first seven months of the year compared with Sh1.46 trillion in a similar period last year, according to the data collated by the Central Bank of Kenya. The 2.09 percent— about Sh30.57 billion— fall has come when global prices of major imports moderated as disruptions in supply chains eased, helping to cut the cost of shipping.
Challenges in global supply chains were last year exacerbated by Russia’s war in Ukraine at a time when they were yet to recover from pandemic-induced shocks. The drop in import bill was largely helped by a 15.83 percent fall in expenditure on intermediate goods used by manufacturers to Sh212.43 billion in the January-July period from Sh252.37 billion in a similar period last year. Kenyan factories largely rely on foreign markets for the supply of materials.
The overall drop in imports helped to narrow Kenya’s goods trade deficit – the gap between merchandise exports and imports – in the review period by 8.81 percent to Sh867.53 billion. The shrink in goods trade imbalance came despite earnings from exports growing at the slowest pace since the pandemic.
Nigeria tasked on Africa’s $300b digital economy gains (The Guardian Nigeria)
Stressing the importance of harmonising data regulation in the region, the Meta chief, said currently 35 African countries have different data regulations unlike the European Union (EU), which has only a single data regulation. According to her, Africa must harmonise data regulation to be able to benefit immensely from the potential of the region.
“Free flow of data across the region is essential to boost trade. While data must be protected, a restricted data ecosystem would be a very big problem for Nigeria and others. Data kept at stagnation doesn’t make it valuable until it is used,” he stated.
Nigeria, Benin Republic Customs Sign Trade Agreement (The Tide News Online)
The Customs Administrations of Nigeria and Benin Republic, recently at a two-day interactive session in Abuja, signed an agreement to develop frameworks for clearing of Nigeria bound goods in Benin Ports and vice versa. The two customs administrations agreed to collaborate to enhance trans-border security and regulate trade between the two countries.
The agreement is expected to deepen the relationship between Nigeria and Benin while promoting their age-old bilateral trade ties. Other areas that the partnership will address include enhancing the proper use of International Transit Guidelines to govern transit-bound goods and fees from Cotonou Port to Nigeria, as well as Integration of Nigeria into the Interconnected System for the Management of Goods in Transit.
It will also enable the countries to foster closer ties between then, while also reactivating the joint committee for monitoring trade and transit relations. Since the signing of the important agreement, many have been left in doubt as to its benefits to Nigeria as a nation, even as many have als argued that by this development, Nigeria would be taking its market and labour to Benin Republic.
The trade volume between Türkiye and African countries has increased eightfold in the last two decades and reached $40.7 billion (TL 1.1 trillion), Deputy Foreign Minister Yasin Ekrem Serim said Tuesday. Speaking at the closing of the 9th World Cooperation Industries Forum (Wci Forum) held in Istanbul between Sept. 18-19, Serim emphasized that the African continent stands out as the rising value of the 21st century with its cultural accumulation and enormous potential.
“Our trade volume with Africa has increased eight times. The figure, which stood at $5.4 billion in 2003, amounted to $40.7 billion in 2022. The value of direct investments exceeded was by $6 billion,” Serim said, adding that President Recep Tayyip Erdoğan is positioned as the world leader who pays visits to the continent the most. The forum with the main theme, “Addressing Challenges, Unlocking Opportunities: Building Stronger Türkiye-Africa Economic Partnerships,” prioritizes the energy, infrastructure, agriculture, agribusiness, health care, tourism and digital marketing sectors.
Third Global Trade and Supply Chain Summit kicks off in Dubai (Emirates News Agency)
The third Global Trade and Supply Chain Summit, organised by The Economist Impact, kicked off today at The Address Dubai Marina Hotel, Dubai. Bringing together thought leaders, trade and supply chain policymakers, analysts, UN representatives and C-level officials in vital sectors, the event aims to address ways to boost the resilience of global trade operations, the essential link connecting sustainability and supply chains, and the role of emerging markets over the next years.
The Summit covers a host of various themes including the effects of geopolitical and economic turmoil on planning and supply-chain operations, digital trade and technology, the changing role of customs organisations and compliance teams, and measuring and deploying sustainability initiatives along the supply chain.
Dr. Thani bin Ahmed Al Zeyoudi, Minister of State for Foreign Trade said in his keynote remarks, “Trade has been essential to the development of the UAE, powering our economic vision by opening new markets, stimulating industrial productivity, creating jobs and introducing new skills and capabilities. It is why we remain a committed advocate of the multilateral trading system. But it is essential trade evolves with the times, adapting to new technologies, developmental challenges and environmental responsibilities. As we build towards MC13, we will be restating the case for open, accessible and well-regulated supply chains – and using platforms such as the Global Trade and Supply Chain Summit to urge stakeholders and policymakers to come together to make them fit for the 21st century.”
The number of international investment projects announced in developing countries in sectors relevant to the Sustainable Development Goals (SDGs) increased by 15% in 2022. However, the growth was unbalanced, with some SDG sectors showing only slow progress. It was also uneven, with negative trends in LDCs (-9%) and stagnation in many other developing countries.
UNCTAD’s review at the midpoint of the 2030 agenda shows that the annual SDG investment gap in developing countries is now about $4 trillion. If the SDG investment needs to 2030 are to be met, some $30 trillion of additional investment must be found over the next eight years. More than half of the gap, or $2.2 trillion, relates to the energy transition alone.
SDG Progress report 2023 (FAO)
The Political Declaration adopted yesterday leaves world leaders with “a to-do list” to turn words into action to attain the Sustainable Development Goals (SDGs), the United Nations chief said today at the close of the SDG Summit, proposing key measures, including reform of the global financial system and increased availability of liquidity to countries in debt distress.
“We must make the most of this Summit’s momentum to spur progress in the months ahead,” Secretary‑General António Guterres appealed to participants as he closed the Summit — known formally as the high-level political forum on sustainable development. Calling for the formation of a leaders group to deliver clear steps that enable the $500 billion per year needed for sustainable development to start flowing before the end of 2024, he also urged developed countries to finally meet their official development assistance (ODA) target of 0.7 per cent of gross national income.
In addition, Mr. Guterres stressed, among other things, the need for recapitalization and urgent additional rechannelling of $100 billion in unused special drawing rights, as well as reform of the global financial architecture. The twenty-eighth United Nations Framework Convention on Climate Change next month will be the moment to operationalize the new loss and damage fund. “This development to-do list is not just homework. This is hope work,” he emphasized, adding: “We have a rescue plan before us in the Political Declaration. Now is the time to lift the Declaration’s words off the page and invest in development at scale like never before.”
President Cyril Ramaphosa has called on partners from wealthy countries to meet the climate financial commitments they made to tackle global warming in developing countries. “We call on our partners from wealthier countries to meet the financial commitments they have made. It is a great concern that these wealthier countries have failed to meet their undertakings to mobilise 100 billion dollars a year for developing economies to take climate action,” the President said. President Ramaphosa was speaking during the 78th Session of the United Nations General Assembly (UNGA78) at the United Nations headquarters in New York on Tuesday.
“Africa is least responsible for the climate damage that has been caused and yet it bears the greatest burden. “Centuries after the end of the slave trade, decades after the end of the colonial exploitation of Africa’s resources, the people of our continent are once again bearing the cost of the industrialisation and development of the wealthy nations of the world,” he said. President Ramaphosa stressed “this is a price that the people of Africa are no longer prepared to pay”.
Themes of the Africa Climate (Finance) Summit: Loans, Taxes, Credits (Gita Briel, tralac)
President Bola Tinubu has called on the United Nations to support Africa to curb the influx of illegal arms trade and illicit mining by foreign firms. He made the call on Wednesday, September 20, while addressing the 78th United Nations General Assembly (UNGA). He said illegal arms deals had resulted in inhumane commercial activities, especially in Sub-Saharan Africa, while noting that illegal mining had been a persistent concern, posing significant economic and environmental threats to several African countries, particularly Nigeria.
Speaking on illegal arms, the President said, “Our entire region is locked in a protracted battle against violent extremists. In the turmoil, a dark channel of inhumane commerce has formed. Along the route, everything is for sale. Men, women and children are seen as chattel.
While highlighting the adverse environmental impacts of illegal mining, Tinubu urged world leaders at the 78th UNGA to collaborate and implement stringent measures to curb the practice. He said: “The fourth important aspect of global trust and solidarity is to secure the continent’s mineral-rich areas from pilfering and conflict. Many such areas have become catacombs of misery and exploitation. The Democratic Republic of the Congo has suffered this for decades despite the strong UN presence there. The world economy owes the DRC much but gives her very little.
Africa’s Newest Oil Jackpot Comes With a Corruption Curse (BNN Bloomberg)
The discovery off the shores of Namibia last year by TotalEnergies SE and Shell Plc of an estimated 11 billion barrels of crude has generated understandable excitement in the southern African country. Even if only a small portion of that potential load — valued at about $1 trillion at current prices — is realistically recoverable, it holds the promise of untold riches for this nation of 2.7 million people. But given what oil finds have spawned elsewhere on the continent, it’s drawing a sobering dose of caution.
“Poor management of the oil and gas sector can drive corruption and inequality that in turn will fuel social tensions and threaten political stability,” Tom Alweendo, Namibia’s minister for mines and energy, told an audience last month at the Mercure Hotel in the capital Windhoek. “It is imperative that the custodians of these resources possess the required skills and above all, that they have a high level of integrity.”
Using the creatives to boost intra-African trade (Africa Renewal)
Africa trade report: Not out of the woods yet (Global Trade Review)
Regional value chains key to Africa’s prosperity (New African Magazine)
Africa all set to enter electric vehicle industry (New African Magazine)