tralac Daily News
President Ramaphosa’s closing remarks during the 3rd Session of The South Africa Bi-National Commission, Windhoek, Namibia (The Presidency of South Africa)
The Ministerial Report that we have just considered and approved has over 170 decisions across various areas of cooperation. This is testament to the thorough and commendable work of our respective Ministers and Officials.
Namibia is South Africa’s largest trading partner in the region. There is capacity to increase our exports to Namibia beyond current products such as chemicals, machinery, vehicles and steel. Similarly, Namibia could go beyond exporting precious metals, iron and steel products, live animals and other goods to South Africa. We have directed our ministers of trade and investment to finalise the draft agreement of cooperation to promote investment, industrial development, cross-border value chains and infrastructure development by March 2024.
This will enhance trade between the two countries and further contribute to the realisation of our regional and continental economic integration agenda. It will give more impetus to implementation of the African Continental Free Trade Area.
Automotive manufacturing gaining traction (Engineering News)
In a keynote address on October 13, Deputy President Paul Mashatile noted the importance of collaboration between the local sector and government with regard to growth in local manufacturing, highlighting the need for policies that incentivise industry participants to produce vehicles in the domestic market. “…the performance of the South African automotive industry is contingent upon a strategic collaboration between the sector and government in order to foster growth, create employment as they advance industry, particularly in the realm of manufacturing.”
Automotive transition presents value chain opportunities (Engineering News)
The transition of the automotive industry to new-energy vehicles holds potential to impact on many other industries, including mining, manufacturing, freight and energy, but collaboration and a policy framework are urgently needed, as current choices will affect the efficiencies of transport for the coming decades. These are some of the topics discussed by automotive industry professionals during the intermodal transport roundtable discussion held on October 11, in Midrand, during the South African Auto Week.
Developing sustainable mobility as part of the transition to net-zero is a huge challenge across the world, as all transport solutions must also be economically viable and transportation must be affordable. The transportation sector also accounts for about 25% of global greenhouse gas emissions, emphasised industrial equipment and technology company Robert Bosch director Björn Noack.
“A key recommendation, which will however not see a payoff within 12 months, is for companies to look at which state of the art trucks they should add to their fleets, as the powertrain efficiency of the trucks that we populate now will be in use for more than the next ten or twenty years and have a direct impact on the efficiency of the transport sector. This is not the time to hesitate,” he emphasised.
Trade, Industry and Competition on implementation of the African Continental Free Trade Area (AfCFTA) (South African Government)
The successful implementation of the African Continental Free Trade Area (AfCFTA) is expected to lead to diversification of exports and increased productive capacity. This is according to the Director of African Union and Africa Multilateral Economic Relations at the Department of Trade, Industry and Competition (the dtic), Ms Claudia Furriel.
Furriel was unpacking the AfCFTA Agreement at the webinar that was intended to engage the chemicals, cosmetics, plastics, and pharmaceutical sectors, as well as industry agencies, associations, and export councils including their members, on the benefits of exporting under the AfCFTA. The webinar was hosted by the dtic.
The Scientific Director at L’oreal South Africa, Ms Dershana Jackison, described the AfCFTA as a key business, regulatory and policy instrument that will shape the cosmetic market of the future. She urged industry players and trade associations to actively participate in its implementation and for government to ensure that the cosmetic sector is prioritised.
Kenya’s trade deficit narrows by $726m (The East African)
Kenya’s trade deficit for the first eight months of the year narrowed by nearly double digits on falling import bills due to reduced expenditure on materials for factories, machinery for infrastructure projects, and fuel. The deficit – the gap between merchandise exports and imports – fell to Ksh1.01 trillion ($6.8 billion) from nearly Ksh1.12 trillion ($7.51 billion) a year ago, provisional official data showed.
The 9.70 percent, or Ksh108.42 billion ($726.92 million), drop in the merchandise trade came at a time when growth in the manufacturing sector showed signs of a slowdown while the new administration cut investment in mega public infrastructure projects.
The Ambassador of Angola to Botswana and SADC Her Excellency Dr. Beatriz Antónia Manuel De Morais paid a courtesy call on the Executive Secretary of SADC, His Excellency Mr Elias Magosi on 12 October 2023, and reiterated her country’s commitment to support implementation of SADC’s regional integration programmes. Ambassador Morais restated the Republic of Angola’s readiness to work with the SADC Secretariat in implementing the 43rd SADC Summit theme, titled “Human and Financial Capital: The Key Drivers for Sustainable Industrialisation in the SADC Region’’ and to support with the implementation of decisions of SADC.
The ongoing 2023 Global Expo Botswana has offered Zimbabwe a prime opportunity to showcase its vast investment opportunities and export of various goods and services into the region and beyond. With 23 participating companies here, Zimbabwe is one of the largest exhibitors and its businesses are a centre of attraction as potential buyers and investors make enquiries on different products and services.
Today ZimTrade, the country’s trade development and promotion organisation, which facilitated the participation of local businesses at the expo, held a session with delegates to unpack various aspects of doing business with Zimbabwe and highlighted the vast export opportunities.
ZimTrade client advisor, Ms Nozipho Maphala, delivered the presentation in which she explored Zimbabwe’s exporting profile covering different products and service offers across economic sectors. She said the country was transforming its economy and diversifying its exports so as to grow the gains beyond the traditional export partners- South Africa and the European Union.
The Governor of the Bank of Ghana (BoG), Dr Ernest Addison, has pushed for a fast-tracked debt restructuring for vulnerable countries under the Group of Twenty (G20) members, including Ghana, Ethiopia, and Malawi. This comes on the back of recent agreements reached between Zambia and Chad and its creditors, and the need to safeguard these countries from any domestic financial market instability, Dr Addisson said.
He was speaking at an African Caucus Meeting on “Making public debt useful for sustainable growth in Africa,” at the ongoing International Monetary Fund (IMF)/World Bank Group (WBG) Annual Meetings in Marrakech - Morrocco.
“While welcoming the latest developments on Zambia and Chad, we underscore the need to revamp the G20 Common Framework (CF) to ensure timely, orderly, equitable, inclusive, and transparent debt restructuring for distressed members in the region (including, Ghana, Ethiopia, and Malawi),” he said. “We also call for a carefully designed debt resolution mechanism, especially, for vulnerable members with large-domestic creditors (as in the case of Ghana) to help avert domestic financial market instability,” the BoG Governor added.
GEF2023: Farmer-driven policies must lead food security efforts (The Business & Financial Times)
Experts at the 2023 Ghana Economic Forum (GEF) have advocated new approaches which put farmers at the forefront of national efforts to address food security concerns. As producers, they said, any policy aimed at boosting production and food security must first and foremost speak to the needs and concerns of farmers if they are to yield the needed outcome; calling for a shift from the current top-down approach of policy formulation to a bottom-up regime.
The experts, during a panel discussion on the topic ‘Ensuring food sustainability and security: a call for new perspectives on the agricultural value chain systems’, came to a consensus that the current status quo – wherein there exists a gulf between policies and reality – cannot continue. They attributed the failure of numerous agricultural interventions by governments to their inability to address stakeholder concerns.
Give us bank of manufacturing, MAN pleads with FG (Tribune Online)
The Manufacturers’ Association of Nigeria (MAN) has called on the Federal Government to constitute a financial institution, a bank of manufacturing, whose sole mandate will be to offer financial services to operators in the real sector of the economy. President of the association, Francis Meshioye, made the call on Wednesday, at the association’s 51st Annual General Meeting media briefing, held in Lagos.
Meshioye stated that Nigeria’s manufacturing sector, as a catalyst for nation’s economic growth, is rather too big to be without a bank specifically designed to take care of its financial interests and needs. He argued that though there are commercial banks and even Bank of Industry (BOI), the sector cannot really leverage those financial institutions for development since they do not find the sector attractive to earn their commitments.
The Manufacturers Association of Nigeria (MAN) is set to use its forthcoming 51st Annual General Meeting (AGM) as a platform to examine what Nigeria needs to do to ensure that the nation’s manufacturing sector is competitive under the African Continental Free Trade Area (AfCFTA) scheme. The AGM is scheduled to hold from October 17 – 19, 2023, with the theme, “Setting the Agenda for Competitive Manufacturing under the AFCFTA: What Nigeria needs to do”.
Speaking at a pre-AGM media briefing, in Lagos, on Wednesday, MAN President, Otunba Francis Meshioye, said that for Nigerian manufacturers to compete effectively there must be a concerted effort spearheaded by the government to tackle the binding constraints that limit local production, and aimed at attracting foreign investment.
“Currently, the cost of manufacturing is daily rising owing to scarce and unavailable manufacturing inputs that continue to shrink profitability and threaten the existence of the critical sector of the economy.
African commodity exchanges join forces under AfCFTA (The Business & Financial Times)
A total of 14 commodity exchanges on the continent have agreed to harness their collective potential under the African Continental Free Trade Area (AfCFTA), in what market watchers have described as one of AfCFTA’s biggest feats thus far.
High on the AfCFTA Association of Commodities Exchanges’ (ACX) agenda, the body is to work collectively on making the continent food-secure and promote market efficiency through sharing knowledge and best practices. ACX will encourage the adoption of modern trading practices including electronic trading platforms and standardised contracts, as well as enhance market information across the continent. This will enhance market efficiency, reduce transaction costs and attract greater participation from both domestic and international traders.
2023 has been a difficult year for the region’s economy, with growth slowing to 3.3 percent from 4 percent in 2022. But we are cautiously optimistic that there is light on the horizon. Growth is expected to rebound to 4 percent in 2024 and looks set to be broad based. Importantly, authorities in many countries are working hard to address macroeconomic imbalances. Fiscal deficits, for example, have been narrowing, helping stabilize public debt in most countries.
Still, it is too early to celebrate as many challenges lie ahead. The funding squeeze is not over, and while debt levels have stabilized, the cost of repayments has increased and high debt service ratios to revenue risk crowding out vital development spending.
The New Development Bank (NDB) and the Development Bank of Southern Africa (DBSA) are pleased to announce the signing of a USD 100 m loan agreement aimed at advancing sustainable infrastructure development in South Africa. This is a continuation of NDB’s strategic cooperation with DBSA, a leading development finance institution operating across Sub Sahara Africa and headquarted in South Africa. This is the second NDB loan to DBSA, following a successful implementation of the first loan of USD 300 m, which was earmarked for renewable energy.
Under the terms of the loan agreement, NDB will provide the USD 100 m loan to DBSA for a range of sustainable infrastructure development projects in South Africa, aimed at improving the country’s economic resilience, environmental sustainability and overall economic growth. The key features of the loan agreement include providing financing in South Africa towards: Clean and renewable energy Social infrastructure (including affordable housing, student accommodation and private health care) Digital infrastructure
Africa needs strong financial markets to unlock much needed capital to drive sustainable development on the continent, the acting Executive Secretary of the Economic Commission for Africa, Antonio Pedro, has urged.
Mr. Pedro, in an address at the launch of the Absa Africa Financial Markets Index 2023, highlighted that effective financial markets are key to Africa’s development prospects. He said Africa risked realizing the Sustainable Development Goals and the African Union Agenda 2063 owing to heightened financial and social challenges triggered by a combination of the COVID19 pandemic, growing inflation and geopolitical turbulence.
“Strengthening financial markets and diversifying the investor base would not only enable governments to mobilize more funding for economic recovery, sustainable development but also enhance financial resilience to future shocks,” said Mr. Pedro, adding that, “To foster the development of their financial markets, countries require a comprehensive approach, encompassing capacity building, robust infrastructure, essential reference tools, benchmarks and opportunities for peer learning.
The Director-General outlined the key findings of recent joint WTO-IFC studies on the West African and Mekong regions. These studies have revealed significant trade finance difficulties faced by small traders and women-led businesses when seeking to participate in global trade. Rejection rates of over 40% and high costs for making requests discourage traders from seeking financial assistance from banks, she said. “Only up to 25% of trade is supported by trade finance in these regions, compared to 60-80% in advanced economies,” stated DG Okonjo-Iweala. However, according to calculations by WTO economists, “raising the trade coverage from 25% to 40% would increase annual trade flows by an average of 8%, reaching 80% in 10 years,” she added.
UNCTAD Deputy Secretary-General Pedro Manuel Moreno speaks on 11 October at the opening ceremony of the 4th Qingdao Multinationals Summit in China. Partnerships are essential to addressing today’s global crises, driving sustainable progress and fostering shared prosperity, UNCTAD Deputy Secretary-General Pedro Manuel Moreno said on 11 October at the 4th Qingdao Multinationals Summit in China.
In a world marked by a pandemic, trade tensions, geopolitical challenges, rising food and energy prices, and mounting debt burdens, Mr. Moreno stressed the need for concerted efforts and coordinated action between governments, businesses and communities.
Stakes are high as heads of state, more than 50 government ministers, over 150 CEOs of leading companies and stock exchanges meet next week at the World Investment Forum 2023 in Abu Dhabi, United Arab Emirates (UAE), from 16 to 20 October. The forum is organized by the UN Conference on Trade and Development (UNCTAD). This edition takes place at a critical time, as developing countries face inadequate levels of investment in achieving the Sustainable Development Goals (SDGs), with an annual gap of more than $4 trillion, according to UNCTAD’s World Investment Report 2023.
UNCTAD Secretary-General Rebeca Grynspan said: “The forum is an opportunity to accelerate action and get more investments to flow into critical development sectors such as health care, food security and climate action. Without more investment, the delivery of the SDGs will be in jeopardy.”
This year’s edition will focus on the key investment challenges caused by today’s multiple global crises and revitalizing investment into food security, the transition to low-carbon energy, health systems, supply chain resilience and productive capacity growth in the poorest countries.
The world faces a global “polycrisis” affecting human and economic development at an unprecedented scale. Progress towards the Sustainable Development Goals (SDGs) has been painfully slow. For many countries, that progress has stalled or reversed, while the climate emergency is felt in intensifying force around the globe, hitting the most vulnerable the hardest. A much scaled up global effort is thus required to eradicate poverty, accelerate inclusive socioeconomic development, and tackle transboundary challenges.
At a time of increasing debt levels and strained government budgets, when more development finance is urgently needed, we, Heads of Multilateral Development Banks (MDBs), recognize the collective role we need to play in response to the global challenges and the efforts that will put us on track towards achieving the SDGs. To this end, we are committed to strengthen our collaboration and individual actions for greater impact.
We will also continue to explore ways to expand our lending capacity. We have identified Capital Adequacy Frameworks (CAF) measures, including those under implementation and consideration which, with strong contributions from shareholders and development partners, could potentially yield additional lending headroom in the order of USD 300-400 billion over the next decade. MDBs, working in collaboration with other development partners, can offer substantial leverage, deep knowledge and expertise, and an unparalleled proximity to governments and those most in need.
The G20 Finance Ministers and Central Bank Governors (FMCBG) meeting under the Indian Presidency was held during 12-13 October 2023 in Marrakech, Morocco, on the sidelines of the Annual Meetings of the International Monetary Fund (IMF) and the World Bank Group (WBG). Members discussed the priority of strengthening Multilateral Development Banks (MDBs) to address the global challenges of the 21st century and the report of the G20 Independent Expert Group (IEG).
Charting the way forward for logistics in Africa (TechCabal)
Solving the problem of logistics for the African market is critical. Africa is still heavily reliant on roads which accounts for 80% of the movement of goods and passengers, according to the African Development Bank. Of that 80%, only 15% is paved in Nigeria, per this Stears report. On another hand, investment in logistics startups on the continent is not as easy as it seems. Ciku Mugambi, CEO of Kobo360, a Nigerian logistics startup, admitted that operating a logistic business in Africa is not “sexy” compared to other tech sectors like fintech, for instance.
Mugambi said this during a panel session at TechCabal’s flagship conference, Moonshot, on Thursday, October 12. “We are literally just moving goods and people from one place to another and most people don’t find that to be very exciting. There is no doubt about how important logistics is. Nothing goes anywhere except we provide the means for that to happen,” Mugambi said.