tralac Daily News
President William Ruto has announced plans to spearhead an initiative that would ensure all military and police uniforms, as well as other clothing items, are exclusively produced within Kenya. Kenya’s textile companies, cotton farmers, garment workers, small businesses and the public reacted with excitement and optimism. Many expect the initiative to revitalize the country’s struggling textile industry and have positive ripple effects on the overall economy.
Kenya currently relies on textile imports, with over 90% coming from countries such as China, India, Pakistan, Tanzania, and Turkey. But investment and finance expert Caroline Karugu believes there’s no need to import fabrics when Kenya can produce them.
However, the president’s new directive raises questions over whether Kenya can meet most of the local demand for textile products. Beyond army boots and police uniforms, most staples, like elsewhere in the world, come from textile manufacturers, mainly in Southeast Asia. “As much as we would like to buy products made in Kenya, they are not all available here. So, some of the products will have to maybe come from China or India,” consumer Anne Mutiso Mwikali told DW.
Kenya ropes in small traders for wider tax bracket (The East African)
Kenya’s tax agency has gone all in to bring small-scale traders and informal sector workers into the tax bracket to increase ordinary revenues, but possibly deviating from the government’s initial plan of taxing ‘trade’ less and ‘wealth’ more. Since the beginning of this Financial Year, the Kenya Revenue Authority (KRA) has rolled out a series of measures, hired thousands of new employees and entered into deals meant to on-board the informal sector into the tax bracket.
This week, the taxman entered an agreement with the Eastleigh Business District Association, a lobby group for traders in one of Nairobi’s largest informal trading centres, to collaborate in enhancing voluntary tax compliance by its members.
Earlier, at the annual tax summit last week, KRA’s commissioner-general Humphrey Wattanga said the taxman is working on policies that will tap into the “great tax potential” of the informal sector, which is estimated to employ over 80 percent of Kenya’s workforce. Last week, the authority said it will “work with National Treasury to establish policies that will simplify, harmonise and reduce the multiplicity of taxes obligated to the informal sector,” in efforts to improve wilful payment of taxes by sector.
Kenya, Angola to resume direct flights to spur trade (Capital Business)
Kenya and Angola will push for the resumption of direct flights between Nairobi and Luanda as part of their efforts to spur bilateral trade. President William Ruto said Kenya-Angola trade has been on the rise in the past four years. However, he observed that more needs to be done to unlock the underlying potential.
“There is a huge scope for these numbers to go up if we strengthen our interconnection.” Besides flights, the Head of State announced the activation of a visa-free regime to ease the free movement of people. “Angolans coming to Kenya will not require a visa. Angola will equally consider the same for Kenyans,” said President Ruto. This, he added, will facilitate a wider interaction of diverse ideas, resources and businesses.
He was speaking on Saturday at State House, Nairobi, when he held talks with his Angola counterpart João Lourenço. During the event, 11 legal instruments were signed. They include on wildlife and conservation, shipping and maritime, mining, youth affairs, forestry, agriculture, ICT, oil and gas, health, diplomacy and public service.
Uganda Airlines has commenced direct connectivity to Lagos from Entebbe International Airport with three weekly flights to Lagos. Abuja and Kano, have been approved as entry points for the airline by the federal government under the Bilateral Air Services Agreement, BASA, between both nations in line with the Single Africa Air Transport Market, SAATM.
The launch of flight services to Lagos by Uganda’s flag carrier, Uganda Airlines would help to close the gap in the travel needs of travelers from West Africa and East Africa. Speaking shortly after the inaugural flight, Uganda’s High Commissioner to Nigeria, Ambassador Nelson Ocherger stated that the approval by the Nigerian government would open a landscape of business opportunities to both nations.
TPA: Lack of investment leads to Dar Port inefficiencies (Tanzania Daily News)
The Tanzania Ports Authority (TPA) has said the lack of substantial investment at the Dar es Salaam Port is a major cause for inefficiencies, failing to compete with neighbouring ports and hence, operating below the international standards. The TPA Director General, Mr Plasduce Mbossa, made the remarks at the historic signing event of three agreements for the investment and operation of the Dar es Salaam Port between the Tanzanian government and Dubai-based DP World at the State House in Dodoma, on Sunday.
“Despite taking various measures to improve the Dar es Salaam Port efficiencies, the port operations have remained below international standards,” he said. “Many ships remain at the anchorage for a long time… for example, as we speak now, there are about 30 ships waiting at the anchorage, while 11 ships are currently being served at the port.” He said the waiting period for a ship to dock is an average of five days while at Mombasa it is 1.25 days and Durban 1.6 days. The transport costs for domestic cargo is about 6,000 US dollars for a container and these are directly transferred to the final consumer. The transport cost for the same container in Mombasa Port is between 3,500 and 4,000 US dollars only.
He attributed the port’s inefficiencies to the absence of modern Information and Communication (IT) systems that correspond to each other, citing some as insufficient area within and outside the port for cargo storage, few docks for anchorage of ships and lack of modern equipment for loading and unloading the ships, taking into consideration that technology is changing from time to time and also that they need huge investment and operation.
DP World signs 30-year concession to operate Dar es Salaam port in Tanzania (Seatrade Maritime)
Ethiopia’s quest for sea access rattles port custodians Eritrea (The East Africans)
The Ethiopian government is trying to stem a potential diplomatic falling-out with Eritrea, with whom it only restored relations three years ago, after its leader hinted at seeking access to the sea for his country’s economic and geopolitical needs. Prime Minister Abiy Ahmed, in a speech in parliament last Sunday, spoke of seeking access to the sea, which he argued was central to the country’s ambitions and said it needed to be addressed “to prevent future generations from resorting to conflict. This can be achieved through discussions on investment options, shares and leases. However, dismissing it entirely as a topic of conversation is a mistake,” he said, according to the Ethiopian News Agency.
“We are not insisting on Massawa or Assab specifically. What we seek is an accessible gateway. However, it may materialise — be it through purchase, leasing, or any mutual arrangement — that’s our objective,” Ahmed said, referring to the Eritrean port cities, once the country’s key gates to the outside world. Eritrea responded to the speech with a cryptic statement: “Discourses — both actual and presumed — on water, access to the sea, and related topics floated in the recent times are numerous and excessive indeed. The affair has perplexed all concerned observers.”
Afreximbank and Morocco announce $1bn plan to enhance trade and investment in Africa (Trade Finance Global)
The African Export-Import Bank (Afreximbank) has signed a Memorandum of Understanding (MoU) with Morocco’s Government, represented by its Ministry of Economy and Finance. This MoU aims to establish a $1 billion Morocco-Africa Trade and Investment Promotion programme.
Per the MoU’s stipulations, the initiative will serve as a framework for future collaboration in mutually beneficial areas between Afreximbank, Morocco’s Ministry of Economy and Finance, other governmental bodies, and Moroccan businesses. The programme will focus on funding and boosting both intra- and extra-African trade by offering credit, risk mitigation, and trade information and advisory services. Additionally, the programme will support various engagements, missions, information exchanges, and capacity-building efforts.
Gov’t pursues Chinese investments in mining sector (The Business & Financial Times)
The government is seeking to attract Chinese investors to the local mining sector as the Minister of Lands and Natural Resources, Samuel Jinapor, leads a delegation including the private sector to participate in this year’s China Mining Conference and Exhibition, in Tianjin, China. The 25th China Mining Conference and Exhibition, which is slated for 26th to 28th October 2023, is expected to bring together governments, investors, and other industry players from across the world. This year’s event is expected to attract more than 10,000 delegates and 400 exhibitors, in attendance and will be held under the theme “Innovation Promotes High-Quality Development of Mining.”
Ghana Investment and Trade Week Summit opens in Accra (MyJoyOnline)
The three-day Ghana Investment and Trade Week Summit, organized by the Ghana Investment Promotion Centre (GIPC) in partnership with MIE Group, has opened in Accra. The summit commenced with a call to businesses to seize the abundant opportunities offered by the African Continental Free Trade Area (AfCFTA) to propel the continent to be a global economic savior in times of crisis.
In his welcome address, Yofi Grant, the CEO of GIPC, emphasized that this gathering marked a landmark summit that brought together investors, traders, policymakers, and exhibitors, all working toward the economic and political prosperity of Africa. Grant highlighted that intra-trade among African countries has only reached a modest 15 percent annually, with intra-African investments, predominantly from North and Southern African countries, accounting for less than five percent.
Ghana: Tullow’s vision for a brighter African future (The Business & Financial Times)
Africa has the potential to play a leading role in global energy demand over the next few decades, given the right policy clarity and economic stability in the region. This was the major view from Tullow at the just-ended Africa Oil Week 2023 in Cape Town, South Africa. Chief Executive Rahul Dhir, on a panel to discuss global opportunities for Africa’s energy resources, was emphatic about the need for deep collaboration between governments and operators in order for this view to be realised in the short-term.
Recent developments in Africa reflect a renewed interest and substantial investment in energy projects that were previously overlooked due to cost and environmental concerns. According to Reuters, Africa is now considering oil and gas projects worth over US$100billion.
As Chief Executive Rahul Dhir has emphasised: “The upside of Africa’s elevated role in global energy demand is high. However, there is a real and present need for a deeper collaboration between governments and operators on the continent, to reduce perceived risks and make the continent a desired oil and gas destination. Operators like us require assurances of an enabling environment for increased investment and partnerships for shared prosperity”.
Nigeria: Tinubu targets $1tr economy, hopeful of $10b inflow to ease FX crisis (The Guardian Nigeria)
In what looked like unveiling President Bola Tinubu’s government economic blueprint, the Federal Government said it is working to push Nigeria into a $1 trillion-economy in three years, precisely 2026. Not done, President Tinubu projected that the Nigerian economy could become a $4 trillion economy by 2025, which is 12 years away.
The President, who reeled these out at the 29th edition of the yearly Nigerian Economic Summit organised by the Nigerian Economic Summit Group (NESG), in Abuja yesterday, said the focus of his administration is on enduring poverty alleviation programme, food security, economic growth and job creation as well as inclusive growth, security of lives and property and implementation of sound economic policies.
At the same occasion, Minister of Finance and Coordinating Minister of the Economy, Olawale Edun said the Federal Government is anticipating a fresh $10 billion inflow into the Nigerian economy within the next few weeks. “Apart from the supply of foreign exchange through NNPC, increased production, reduced expenditure, from transactions such as forward sales, from our discussions with sovereign wealth funds, that are ready to invest and provide advanced alongside that investment, there is a line of sight of $10 billion worth of foreign exchange in the relatively near future in weeks rather months.”
Limited knowledge and information on aflatoxin by stakeholders along the value chain has been identified as one of the major factors inhibiting aflatoxin prevention and control within the East African Community. The inability by most farmers to easily access appropriate technologies for aflatoxin mitigation and inadequate private sector participation in aflatoxin management are also significant contributing factors to efforts to contain aflatoxin contamination in the region. Low awareness among value chain actors, from the farm to consumers, on the social economic consequences of consuming or trading in aflatoxin contaminated foods and feeds is the other factor that aggravates the aflatoxin menace.
It is estimated that agricultural commodities account for about 65% of intra-regional trade in the EAC. It is further estimated that losses associated with Aflatoxin contamination in Africa have escalated to US$670 million annually.
EAC, EU launch second phase of the market access (People Daily)
The first phase of a European Union (EU) backed market access upgrade programme in East Africa spiked growth of coffee exports from the East Africa Community (EAC) regional block to European markets from €488 million (Sh77.7 billion) in 2018 to €1.1 billion (Sh159.2 billion) in 2022. During that period, avocado exports to the EU market grew from €85.5 million to €112.4 million, says EAC Secretary General Dr Peter Mathuki.
The €40 million (Sh6.4 billion) regional programme funded by the EU is set to unlock the full potential of agribusinesses within the EAC, Dr Mathuki said at the launch of Phase 11 of the EAC – EU programme. The second phase will strengthen EAC’s small businesses through enhanced regional and international trade in close partnership with the East African Business Council, EAC Partner States, business support organizations, and local institutions. Building on the successes of the current success, focus priority sectors will include avocado, cocoa, coffee, essential oils, French beans, gum arabic, horticulture, leather, packaging, spices, and tea – with an emphasis on processing, value addition, diversification, investment, and export linkages.
In a significant step towards enhancing trade efficiency and promoting economic growth in the COMESA-EAC-SADC Tripartite Free Trade Area (TFTA), the World Customs Organization (WCO), has successfully assisted the Secretariat of the Common Market for Eastern and Southern Africa (COMESA) to update the Rules of Origin (RoO) from the HS 2017 to the HS 2022. This critical development was achieved in a workshop held in Lusaka, Zambia, from October 9 to 11, 2023.
The main objective was to assist the COMESA Secretariat and the TFTA Member/Partner States in aligning the RoO with the HS 2022 edition to reduce the risk of misclassifying goods. The draft updated TFTA RoO for HS 2022 shall be submitted to the TFTA Technical Working Group on Rules of Origin for validation.
Framing the technical assistance under the perspective of sustainability, the RoO Africa Programme invited experts from the COMESA members states to contribute to the alignment exercise and build their competency, so as to be equipped to conduct the same exercise for the next HS editions.
Ghana leads peers with strong AfCFTA framework (The Business & Financial Times)
Ghana currently has a regulatory framework that broadly aligns with the goal of enhanced intra-African trade being espoused by the African Continental Free Trade Area (AfCFTA), a new report has shown. The ‘Situational Analysis of Ghana’s AfCFTA Preparedness’ – jointly published by Ishmael Yamson & Associates in collaboration with Sam Okudzeto & Associates – showed that the nation is ahead of many of its peers regarding the broad framework for implementing the agreement.
“Ghana has a robust legal and regulatory framework for trade. Government has also developed, and to some extent implemented, various policies and initiatives to promote trade…,” portions of the report read. The report, which provided a review of the legal, policy and regulatory framework for implementing AfCFTA in Ghana, however highlighted areas for improvement across trade in goods as well as services, labour, investment, dispute resolution and competition.
Opportunities, considerations for manufacturers in terms of AfCFTA (Engineering News)
There are considerable opportunities that the continent’s manufacturers can leverage from the African Continental Free Trade Area (AfCFTA); however, there are a number of considerations and areas to address if the full benefits of this are to be realised. This was highlighted by speakers on October 24, during a panel discussion as part of the Manufacturing Indaba that is being held this week in Johannesburg.
CFO Namibia principal founder Ally Angula said research has shown that the countries in Africa are trading very basic commodities among themselves. She averred that the AfCFTA would challenge manufacturers to diversify and broaden this scope into more refined products, and to then enter the trade ladder. She also called for rectifying critical infrastructure like ports, and for those responsible for this to liaise with manufacturers to ensure that what they need is considered in planning. She mentioned a major challenge to doing business across Africa as moving money across the continent being very difficult. However, this also presents an opportunity in a growing market.
The African Regional Economic Communities (RECs) and the AfCFTA Secretariat convened a consultation to exchange on challenges and opportunities towards efficient and co-ordinated implementation of the Harmonized System (HS) and rules of origin in Africa. The consultation took place on 3 October 2023 in Plaigne Magnien, Mauritius, at the margins of the EU-WCO Programmes for Harmonized System and Rules of Origin in Africa annual steering committee meetings.
The deliberations on the HS looked at the lessons learnt from the migration to the 2017 and 2022 version of the HS, the RECs’ role in streamlining the application of new versions, and discussed opportunities and prospects for a successful implementation of the HS 2028 across the continent. The experts also exchanged on the importance of advance rulings and targeted competency development, as well as the urgency to update the AfCFTA tariff concessions from the HS2017 to the 2022 version of the HS.
The discussions around origin tackled the overlapping rules of origin in Africa, the processes for certification and verification of origin, and the need to streamline the RoO for better regional integration and seamless trade facilitation. The experts also exchanged and presented recommendations regarding e-certificate and self-certification of origin, as well as the necessity to build competencies and solid pool of experts in Africa.
Investment survey ranks Uganda among top ten sub-Saharan prospects (Uganda Business News)
Uganda is among the top ten countries in sub-Saharan Africa where companies are looking to invest or expand over the next few years, according to a KPMG report released Friday. The country was selected by ten per cent of senior executives from companies that have invested in sub-Saharan Africa (SSA) over the past four years and anticipate further acquisitions or expansion of current operations in the next two years. South Africa ranked first as the leading prospective investment destination, selected by half of the respondents, trailed by Nigeria at 30 per cent and Tanzania at 15 per cent. Ghana, Kenya, and Mauritius each received 14 per cent.
South Africa and Nigeria offer compelling investment opportunities due to their large economies offering significant market opportunities and, in the case of Nigeria, a huge consumer base of 220 million people. In addition, both countries have abundant natural resources – Nigeria has crude oil, while South Africa has diverse mineral deposits. The report highlights that both countries act as regional economic hubs, facilitating access to neighbouring markets and regional integration efforts.
Afreximbank announces the historic issuance of the first-ever multi-border transit bond. The US$10 million transit bond issued in favour of Innovate General Insurance (IGI) of Zambia is expected to provide counter guarantees and boost IGI’s capacity to issue bonds to Clearing and Forwarding Agents in Zambia. The Afreximbank African Collaborative Transit Guarantee Scheme (AATGS) was designed by the Bank to promote the seamless movement of goods across multiple national customs borders, as a means of improving efficiency and shortening the time for border clearances.
The US$1 billion Collaborative Guarantee Scheme is expected to accelerate cross-border trade in Africa and save the continent about US$300 million annually in transit costs. As a Pan-African Multilateral Financial Institution, Afreximbank is able to provide capacity to national sureties to enable them to issue bonds at affordable rates and facilitate intra-African trade under the African Continental Free Trade Agreement (AfCFTA).
Being one of the AfCFTA-flagship initiatives, the Collaborative Guarantee Scheme is being implemented in partnership with the AfCFTA Secretariat as well as Regional Economic Communities. The facility to IGI, which is expected to facilitate the transportation of goods across its almost 5,700 km of borders with its eight neighbouring countries, is a realisation of the broader partnership between Afreximbank and COMESA Council of Regional Customs Transit Guarantee (RCTG-Council)
The International Energy Agency projects that manufacturers of clean energy technologies will need forty times more lithium, twenty-five times more graphite, and about twenty times more nickel and cobalt in 2040 than in 2020. To exploit this opportunity, in 2021 the government of the Democratic Republic of Congo and the United nations Economic Commission for Africa (UNECA) came together with the African Export-Import Bank (Afreximbank), the African Development Bank, Africa Finance Corporation and other entities to identify ways to channel investments to increase Africa’s share of the value chain for lithium-ion batteries, electric vehicles and clean energy.
The DRC has 51% of the world’s cobalt reserves as well as huge hydroelectric power potential. The country is thus uniquely positioned to become a low-cost and low-emissions producer of lithium-ion battery precursor materials and cells, says an African Development Bank report titled ‘Strengthening Africa’s Role in the Battery and Electric Vehicle Value Chain’. Further, DRC and Zambia are Africa’s largest producers of copper, an important component in wiring and motors.
A BloombergNEF study was commissioned to look into the feasibility of setting up Special Economic Zones to manufacture battery precursors in DRC and Zambia. It confirmed the project was technically feasible and financially viable, with an estimated total cost of $2.7 billion.
“The global development boat is leaking and the consequences will be devastating, unless we seal the leaking areas”, warns the African Development Bank President, Dr Akinwumi Adesina. Adesina made this known in a statement during the 2023 Kofi Annan Eminent Speakers’ Lecture. He said the challenges of our world today, from the COVID -19 pandemic, climate change, rising debt, food insecurity, and conflicts, were keeping the lid on development globally.
He said at the top of the leakage was climate change which posed existential risks for the world. “We must do all we can to keep global warming to no more than 1.5 degree Celsius. We need innovations to power the world better with renewable energy. “There is too much hunger in the world. It is not acceptable that over 2.3 billion people in the world go hungry. God did not create stomachs to go empty. “He created them to be filled. There must be a hunger-free world,” he said
According to Adesina, the inability to cope with global health pandemics. The Covid-19 pandemic has taught us how important it is to have global pandemic preparedness. He said it had also taught us to ensure no one was left behind in access to affordable health care. “After all, all lives matter, for the rich and poor.”
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Maritime transport handles over 80% of global merchandise volume, making ports essential to global trade and economy. They’ve evolved into multifunctional hubs, fostering economic growth in their respective regions. In 2022, over 900 ports were servicing global liner shipping networks, handling 171 million n 20-foot equivalent units (TEU) of containerized trade and generating over 800 million TEU of world containerized port traffic.
Given ports’ pivotal role in global trade, monitoring their performance is vital for trade efficiency, cost-effectiveness, and sustainability.
The 2030 Agenda for Sustainable Development, Sustainable Development Goals, and the 2015 Paris Climate Agreement have also emphasized the need for all economic sectors, including maritime transport to monitor and measure performance and track progress towards the achievement of relevant economic, social, and environmental targets.
Seven WTO members deposited their instruments of acceptance of the Agreement on Fisheries Subsidies on 23 October, propelling the much-anticipated entry into force of the historic agreement for ocean sustainability closer to realization. High-level officials of Albania, Australia, Botswana, Cuba, Côte d’Ivoire, the Republic of Korea, and Saint Lucia presented their instruments of acceptance to Director-General Ngozi Okonjo-Iweala in a ceremony as part of the two-day Senior Officials Meeting at the WTO’s headquarters in Geneva.
The latest instruments of acceptance bring the total number of WTO members that have formally accepted the Agreement to 51. This is 46% of what is needed for the Agreement to come into effect (two-thirds of the WTO membership). “Each formal acceptance of the Agreement on Fisheries Subsidies marks an important step towards its entry into force, which is so important for ocean health, for the livelihoods and food security of millions of people, and for the WTO,” DG Okonjo-Iweala said.