Building capacity to help Africa trade better

tralac Daily News


tralac Daily News

tralac Daily News

Southern Africa: Botswana Extends Ban on South African Fruits and Vegetables (allAfrica)

Botswana announced on Monday, December 5, 2023 that it would extend and expand restrictions on imports of some fresh produce from South Africa as it tries to become self-sufficient in food and cut its import bill. Botswana’s President Mokgweetsi Masisi said the import ban had slashed the country’s fresh-produce import bill by 71%. Botswana, together with Namibia, extended its end December 2023 deadline to 2025. The number of products will double to 32, from July 2024. Among the staples impacted will be potatoes, tomatoes and onions which are among the largest commodities affected.

While it could be good news for South African consumers, as the ban could lead to cheaper products at home, Agriculture Minister Thoko Didiza is looking to engage with her Botswana counterpart as the government says that this is in contravention of the Southern African Customs Union (SACU) trade agreement with other southern African neighbours.

05 December 2023: Minister Didiza responds to Botswana announcement on restricts of imports of agricultural products from South Africa

CBK boss on why Kenya is losing edge in EAC (Business Daily)

The Central Bank of Kenya (CBK) has blamed Kenya’s weakening competitiveness compared to her East African neighbours over the past decade on a lag in foreign direct investment, which has contributed to the free fall of the shilling. The regulator on Wednesday published comparative data for Kenya, Uganda and Tanzania covering various measures and ratios such as the current account, exports-to-GDP, travel receipts, FDI and debt service, which show that Kenya’s position has deteriorated consistently compared to those of her EAC neighbours.

Kenya has only outperformed Uganda and Tanzania in the growth of diaspora remittances, which have in the past decade risen to become the country’s top source of dollars ahead of agriculture and tourism earnings. Uganda and Tanzania have been helped by more stable currencies against the dollar this year, a factor that foreign investors consider when pumping capital into an economy due to the erosion of returns through exchange losses. This year, the shilling has weakened against the currencies of Uganda and Tanzania by 18 percent and 13.8 percent respectively.

“The point we want to make is that we have been losing competitiveness. Our level of exports to GDP has been declining consistently, we are not getting as much tourism receipts as our neighbouring countries, and our FDI has also declined,” said CBK governor Kamau Thugge on Wednesday.

Uganda parliament approves loans totalling $1.38bn (The East African)

Uganda’s parliament on Wednesday approved three loans amounting to over Ush5.2 trillion ($1.38 billion) including Ush3.5 trillion ($927.2 million) from local commercial banks to fund the supplementary budget, Ush1.23 trillion ($325.83 million) from World Bank for smart agriculture and Ush554.7 billion ($146.9 million) from China to finance the e-government infrastructure project phase. The latest loan requests push the country’s debt further, which by the end of August 2023 stood at over Ush88.8 trillion ($23.5 billion).

“The committee therefore recommends that the request by the government to borrow up to $325 million and receive a grant of up to Ush1.23 trillion from the International Development Association (IDA) of the World Bank Group to finance the Uganda Climate Smart Agricultural Transformation Project (UCSATP), be approved subject to the recommendations herein.” Uganda’s parliament on Wednesday approved three loans amounting to over Ush5.2 trillion ($1.38 billion) including Ush3.5 trillion ($927.2 million) from local commercial banks to fund the supplementary budget, Ush1.23 trillion ($325.83 million) from World Bank for smart agriculture and Ush554.7 billion ($146.9 million) from China to finance the e-government infrastructure project phase.

Uganda secures Shs958bn loan to improve rural transport and facilitate regional integration (The Independent Uganda)

Cameroon’s trade dynamics in ECCAS: opportunities and challenges (Business in Cameroon)

From 2019 to 2022, nations in the Economic Community of Central African States only captured 6.3% of Cameroon’s exports, well below the 10% and nearly 35%, respectively, for Africa as a whole and the European Union. According to the Ministry of the Economy’s Competitiveness Committee, which provided these figures, “Cameroon should focus on generating (by stimulating regional markets) with neighboring countries, a dynamism that will trigger more active participation in world markets, particularly with the arrival of the African Continental Free Trade Area (AfCFTA)”.

However, despite the low level of trade between ECCAS countries and Cameroon, the report notes that a number of products from Cameroon are highly prized and “in strong demand” in the region. These include “zinc and zinc articles, which account for an average 36% of ECCAS import demand”, while “cocoa and cocoa preparations account for an average 30%”. Alongside these highly sought-after products, for which other countries clearly supply larger shipments than Cameroon, there are other Cameroonian products that “dominate ECCAS markets”.

Benin Can Create Opportunities for a Just Energy Transition and Green Inclusive Growth: World Bank Report (World Bank)

While high growth over the past decade has helped Benin reduce poverty, the country’s development gains are threatened by the impact of climate shocks, according to the new Country Climate and Development Report (CCDR) released today. Bold actions are needed to promote sustainable and inclusive growth, seizing opportunities for greater forest and land management, resilient urban infrastructure, and energy transition to achieve universal access to electricity.

Benin has amongst the lowest greenhouse gas (GHG) emissions globally, yet it remains one of the most vulnerable countries to climate change, ranking 152 out of 181 countries for extreme climate vulnerability.

“The issue raised by the report is how to reconcile development with the challenge of climate change in order to protect the poor and vulnerable,” said Nathalie Picarelli, World Bank Senior Economist, and principal author of the report. “Our report estimates that almost half a million to a million more people could fall into poverty by 2050 if no adaptation measures are taken.”

Majaliwa: Future of African trade depends on a successful AfCFTA (The Citizen)

Prime Minister Kassim Majaliwa said yesterday that the future of trade in Africa rests on the successful implementation of the African Continental Free Trade Area (AfCFTA). Speaking during the opening of the AfCFTA Conference on Women in Trade, Majaliwa said the trading bloc combines countries that share history and have similar economic structures.

“In general, the Africa free trade zone will help African countries develop the economies and prosperity of their people. The full implementation of the AfCFTA will determine the success of intra-African trade if the existing opportunities are utilised properly,” he said.

Women and youth face structural and traditional challenges that prevent them from directly benefiting from business opportunities and benefits. He therefore urged deliberate efforts to be taken to deal with obstacles that prevent women and young people from using the opportunities arising from the AfCFTA, including technical and financial challenges.

Illicit financial flows, debt management, cost of capital, dominate discussions by African economists (AU)

African economists have kicked off a forum to examine what the continent must do to finance its development agenda efficiently and sustainably. The 6th Congress of African Economists which gathers African Economists from across the continent and the diaspora, will seek to deepen the understanding and analyze the implications of Illicit Financial Flows (IFFs) and the effectiveness of the debt management strategies employed at the national level. The congress is focused on “Financing Africa’s Development beyond Crisis” delving into issues that are critical to the African Union Member States to close the financing gap for inclusive growth, sustainable development, and enhanced prosperity.

Recent analysis from the African Development Bank suggest that Africa’s average debt-to-GDP ratio will remain high at 66 percent in 2023 and stabilize at 65 percent in 2024 due to the growing financing needs associated with rising food and energy import bills, high debt service costs, exchange rate depreciations, and rollover risks. Further, many countries continue to face difficulties in accessing international capital markets due to unfavourable credit ratings and the inefficiency of the Global Financial Architecture. The limited revenue mobilization has led to local currency debt, which has increased from 35 percent of GDP on average in 2019, to 42 percent in 2021 signaling that domestic debt restructuring should be part of the negotiations for the resolution of public debt crises in countries facing risks.

Amb. Albert Muchanga, African Union Commissioner for Economic Development, Trade, Tourism, Industry and Minerals of the Commission observes that to navigate the financial strain and sustainably finance Africa’s development, Africa must improve domestic resource mobilization to bridge the budget deficit gap.

“The continent must focus more on innovative approaches to mobilize domestic resources and external private capital, and stem illicit financial flows. This can be made possible if the continent takes advantage of the USD 220 billion loss annually due to tax incentives. Additionally, effectively stemming IFFs will allow us to secure USD 90 billion yearly, which represents approximately 3.7% of Africa’s GDP. There is also urgent need for African countries to strengthen the links between debt financing and growth returns to ensure debt sustainability. Debt to finance must be channeled to the most productive projects that generate sufficient growth to pay for the debt in future.”

Nigeria, other ECOWAS countries to support new international ocean treaty for high seas - Salako (The Authority News)

Minister of State for Environment, Dr. Iziaq Salako has restated support of African countries for the ratification of the new international ocean treaty for the high seas. He said this at the High Ambition for the High Seas at the Monash University stand at the IUCN in the margin of of COP28 in Dubai.

He said Nigeria is also using the instrumentality of ECOWAS Chairmanship under President Bola Ahmed Tinubu to mobilise the ECOWAS sub-region. According to him “Just last week, with the support of Bloomberg Ocean Initiative, ECOWAS countries met in Abuja, Nigeria and decided on a path to promptly ratify the newly adopted high-seas treaty to facilitate the designation of highly and fully protected areas in the global ocean beyond national jurisdiction. “For Nigeria and indeed for ECOWAS, this is an essential and urgent step, and we call on all other regions and countries to join us and promptly ratify the treaty so that we can achieve 60 ratifications by June 2025.

Airbus picks Kenya for first drone hub (Nation)

European aerospace giant Airbus is eyeing Kenya as the base for its first earth station for high-altitude communication drones, opening the potential for up to 1,000 jobs for locals. Airbus subsidiary AALTO, which has developed the solar-powered Zephyr High Altitude Platform Station (Zephyr HAPS), said it plans to put up the operation hub in Laikipia County from early next year, subject to regulatory approvals in Kenya.

The company has been scouting for locations that offer a combination of favourable weather conditions for launching and landing the aircraft, good business practices and ease of doing business, a large pool of talent and the ability to offer the right licences quickly. “We looked at all of these and realised Kenya has all of these qualities. We are here to ask the different entities and stakeholders to work with us…we have other options also, but we are focusing on getting Kenya going first,” said AALTO chief executive officer Samer Halawi, without disclosing the expected financial outlay on the hub.

IATA is urging governments to prioritise the production of sustainable aviation fuels (Engineering News)

The production of sustainable aviation fuels (SAF) is not receiving the priority it needs, the International Air Transport Association (IATA) has warned. SAF is essential if commercial aviation is to achieve net-zero carbon emissions status by 2050.

SAF production this year was more than 100% greater than last year, the association highlighted. While total SAF production in 2022 came to 300-million litres, or 0.25 Mt, this year’s production is estimated at more than 600-million litres, or 0.5 Mt. But SAF production this year accounted for only 3% of the global total renewable fuel production; in other words, 97% of renewable fuel production went to other sectors.

COP28: Africa could lose $25 billion per year as new EU carbon tax comes into effect, warns African Development Bank’s Adesina (AfDB)

African Development Bank Group President Dr Akinwumi Adesina has warned that a new EU carbon border tax could significantly constrain Africa’s trade and industrialization progress by penalizing value-added exports including steel, cement, iron, aluminium and fertilizers. “With Africa’s energy deficit and reliance mainly on fossil fuels, especially diesel, the implication is that Africa will be forced to export raw commodities again into Europe, which will further cause de-industrialisation of Africa,” he said.

“Africa could lose up to $25 billion per annum as a direct result of the EU Carbon Border Tax Adjustment Mechanism,” the Bank President told delegates at the Sustainable Trade Africa Conference held at the UAE Trade Centre in Dubai.

“Africa has been short-changed by climate change; now it will be short-changed in global trade,” the Bank President said. “Because of weak integration into global value chains, Africa’s best trade opportunity lies in intra-regional exchanges, with the new Africa Continental Free Trade Area estimated to increase intra-Africa exports over 80% by 2035.”

Climate Action Window: The African Development Bank Group launches the first call for proposals for adaptation projects in 37 low-income African countries (AfDB)

The African Development Bank Group has launched the first call for climate adaptation proposals for the Climate Action Window (CAW) during the COP28 climate conference in Dubai. The allocation for this call is roughly $258 million, to be disbursed as grants. Proposals must be submitted by 2 February 2024.The CAW was created during the 16th replenishment of the African Development Fund, the concessional arm of the Bank Group. It seeks to accelerate adaptation measures in 37 low-income African countries by allocating 75 percent of its resources to adaptation action, 15 percent to mitigation and 10 percent technical assistance.

Kevin Kariuki, Bank Group Vice-President for Power, Energy, Climate Change and Green Growth, officially launched the call for proposals during a 4 December COP28 event on Ramping Climate Adaptation Finance in Africa. He said the CAW was seeking to raise $4 billion by 2025 towards the ultimate target of $13 billion.

“The first goal of the facility is the continent’s adaptation to the climate challenge. It should be a source of accessible and effective finance for the most vulnerable countries,” Kariuki said. He welcomed the first contributions to the CAW from the United Kingdom, the Netherlands, Germany, and Switzerland.

COP28: African civil society unveils its recommendations for the fight against climate change in Africa (AfDB)

At the United Nations’ climate conference COP 28 an African civil society coalition has unveiled its five absolute priorities to fight climate change: adaptation, loss and damage, food systems; land use; and the protection and restoration of forests.

The priorities were announced by Secou Sarr, Executive Secretary of ENDA-Tiers Monde, representing a collective of African non-governmental organizations (NGOs) at a side event held on Tuesday 5 December, at the ongoing United Nations Climate Conference (COP28) in Dubai.

These NGOs gathered around a common platform launched at COP28 - the “African Development Bank Group-Civil Society Coalition on Climate and Energy”. Standing together, the groups intend to have greater influence on debate at COP28.

Alarm bells ignored as Africa continues to face deepening food crisis (UNECA)

Africa is confronting an unprecedented food crisis, according to a new report launched today by the Food and Agriculture Organization of the United Nations (FAO), the African Union Commission (AUC), the UN Economic Commission for Africa (ECA), and the World Food Programme (WFP). The report, Africa Regional Overview of Food Security and Nutrition - Statistics and Trends 2023 highlights alarming statistics on food insecurity and malnutrition that underscore the urgent need for comprehensive action.

“The deterioration of the food security situation and the lack of progress towards the WHO global nutrition targets make it imperative for countries to step up their efforts if they are to achieve a world without hunger and malnutrition by 2030,” FAO Assistant Director-General and Regional Representative for Africa Abebe Haile-Gabriel said in the report’s joint foreword, together with H.E. Josefa Leonel Correia Sacko, Commissioner for Agriculture, Rural Development, Blue Economy and Sustainable Environment at the AUC, Hanan Morsy, Deputy Executive Secretary and Chief Economist at ECA, and Stanlake Samkange, Senior Director for Strategic Partnerships at WFP.

Gearing up Africa’s energy transition by conducive policy and legislative frameworks (UNECA)

Supportive policies and robust regulations will boost private investment in the energy sector in Africa, one of the least electrified regions in the world, experts said. Despite vast opportunities in the development of the electricity sector in Africa, there is low private sector investment in energy infrastructure and service delivery on the continent. A reform change in the policy and regulatory frameworks to ensure adequate openness, attractiveness, will ready the African market for private investments, energy experts agree.

More than 600 million Africans do not have access to electricity. Africa generates only 4% of the global energy despite its abundant renewable energy resources, including 40% of the world’s solar irradiation potential. Besides, Africa is also rich in cobalt, manganese, platinum, lithium, and copper – critical minerals for producing batteries and other green transition products.

Based on assessment in 16 countries undertaken by the ECA and RES4Africa Foundation, Mr. Hailu said key areas for improvement related to market openness such as policies and plans, sector regulation, market organization, private sector participation models and procurement models. In addition, there is a need for attractiveness through contracts and economic regulation, incentives and credit enhancement. Readiness such as the presence of permits and authorization administration, technical codes and grid access is also important to fast-track private investment through a better enabling environment.

Trade regulations for climate action: New insights from the global non-tariff measures database (UNCTAD)

This report examines the use of trade-related regulations, known as non-tariff measures (NTMs), in support of domestic and international climate change mitigation efforts. The analysis can help policymakers and other stakeholders better understand the linkages between trade and climate policies and make more informed decisions to use trade as a driver for climate action. NTMs cover a wide array of policy tools which can be directly linked to climate action or be imposed primarily for safety, health and broader environmental protection purposes.

Climate change-related NTMs cover a higher share of trade in high income and industrialized middle income countries, as they are the largest traders in these CO2 intensive sectors. Low income economies’ import baskets feature less CO2 intensive goods and their NTMs therefore have a smaller impact on global trade. But low income countries make no fewer regulatory efforts in combating climate change through NTMs.

Technical Barriers to Trade (TBT) account for more than 61 per cent of all identified climate change-related NTMs. Other common NTMs are quantitative restrictions and export-related measures. While broader types of relevant NTMs are similar across countries, there is significant divergence in the details and specific requirements that hints at lacking international coordination and causes unnecessary trade costs.

Mapping trade-related measures in Nationally Determined Contributions (UNCTAD)

Under the Paris Agreement, “each Party shall prepare, communicate and maintain successive nationally determined contributions that it intends to achieve” (UNFCCC, 2023a). These nationally determined contributions, or NDCs, reflect each country’s highest possible ambition to tackle climate change, taking into account their common but differentiated responsibilities, respective capabilities, and national circumstances. NDCs include emission reduction objectives (UNFCCC, 2023b) and most contain detailed lists of adaptation and mitigation measures to be implemented over a given period. Such measures can also pursue economic diversification outcomes.

Trade policy actions can be effective tools on the ground to achieve the targets, for instance, facilitating local industries’ access to environmentally preferable goods and services.

COP28 is about action, not politics and point scoring, says UN climate chief (UN News)

UN climate chief Simon Stiell said on Wednesday that COP28 delegates are not in Dubai to “score points” and play at “lowest-denominator politics”; they must take ambitious action on curbing global warming and ending the climate crisis.

Mr. Stiell’s strong message to government negotiators comes as the latest UN climate conference, running in the UAE’s main city, Dubai, since last Thursday, reaches the halfway mark with agreement on financing for climate adaptation and the fate of fossil fuels still up in the air. “We need highest ambition, not point scoring or lowest common denominator politics,” said Mr. Stiell, who is the Executive Secretary of the UN climate convention, which facilitates COP28.

On climate pledges, developed countries urged to walk the talk (People’s Daily Online)

Climate crisis victims can’t wait “forever.” It’s the moment for “them” to take real action. “They” need to “walk the talk.” Calls for “them,” the developed countries that had produced the largest share of greenhouse gases in our atmosphere, to repay historical debt were resounding among participants here at the ongoing COP28 climate conference.

As major carbon emitters since the Industrial Revolution, developed countries bear historical responsibilities and legal obligations to offer help to developing countries, the biggest victims of climate change. Under the UNFCCC and its Paris Agreement, developed countries should provide assistance in finance, technology and capacity building to developing nations to adapt to climate change and mitigate its impacts.

At the 2009 climate conference in Copenhagen, developed countries pledged to provide 100 billion U.S. dollars in climate finance every year by 2020. However, the promise has yet to be fulfilled. How long will the world still have to wait till developed countries fully deliver the promised funds?

South African companies face challenges to compete globally, digital innovation index shows (Engineering News)

South African companies face tremendous challenges to compete on the global market, while simultaneously addressing local socioeconomic inequalities and nurturing nationwide prosperity, amid global geopolitical and economic uncertainty.

Limited investment, a risk-averse culture and the low availability of talent on the local market present the most significant challenges to companies’ ambitions to drive transformational initiatives through innovation in order to leapfrog their competition, the ‘Digital Innovation Index Report 2023’ states. Most of the 42 organisations that contributed to the report believe that an ability to innovate within their organisations is a matter of strategic advantage, said the report, which was produced by systems integrator BCX and strategy consultancy EY-Parthenon.

“Digital innovation occurs at the convergence of business, data and technology. The emergence of transformative technologies, such as machine learning, augmented reality and cloud computing, is reshaping the market, creating both challenges and opportunities for businesses,” says EY-Parthenon strategy and innovation Africa head Heather Orton.

President Ramaphosa to address Presidential Plenary on Science, Technology and Innovation (SAnews)

“The STI Plenary will bring together leaders in government, industry, academia and civil society to discuss progress made in the National System of Innovation (NSI) and challenges in this sector, and will explore ways for STI and skills development to impact positively on the South African economy,” the Presidency said in a statement. The White Paper introduced the concept of an Inter-Ministerial Committee (IMC) on STI and a Presidential STI Plenary as instruments to enhance STI policy coherence, as well as programme and budget coordination in the South African national system of innovation.

In November 2022, Cabinet adopted the STI Decadal Plan to guide the first 10 years of implementing the 2019 White Paper on STI. “The Decadal Plan seeks to respond to Phase II (2020-2024) and III (2025-2030) of attaining the National Development Plan (NDP) targets for STI, which propose that innovation is earmarked to improve the productivity and competitiveness of key sectors of the South African economy and contribute to higher GDP growth rates overall.”

SADC presents draft report on the implementation of Protocol on Science, Technology and Innovation to assess its implementation in the Member States (SADC)

Southern African Development Community (SADC) presented a draft report on implementation of the SADC Protocol on Science, Technology and Innovation (STI) during the Strengthening Research and Innovation Management II (SRIM II) Country Focal Point meeting on the margins of the Science Forum in Pretoria, Republic of South Africa on the 6 December 2023.

In his presentation, Mr Reaboka Morakabi, Programme Officer for Science, Technology and Innovation at SADC Secretariat, highlighted the main factors that have favourably contributed to the domestication and implementation of the Protocol on STI in Member States, which are: Political will and stability in Member States; Creation of responsible set ups (Departments, Agencies) mechanisms and systems for promoting and coordinating STI by SADC countries; Existence of policies, legislation, regulations, and national development frameworks on STI, that have, among others contributed to the domestication of the Protocol on STI with the Member States; Member States interest to work on issues of regional integration in the region; Creation of public awareness and engagement by Member States; Construction of good infrastructure, such as in transport and information and communication technology; Signing multi and bilateral cooperation regionally and internationally and participation in regional and international affairs, and Member States increasing their individual budgets for STI investments

Report explores opportunities and challenges for developing economies from digital trade (WTO)

A new joint report launched on 7 December looks into opportunities and challenges for developing economies arising from digital trade. “Digital Trade for Development” is a joint publication by the International Monetary Fund (IMF), the Organisation for Economic Co-operation and Development (OECD), the United Nations Conference on Trade and Development (UNCTAD), the World Bank and the World Trade Organization. The report explores specific policy issues, including the WTO’s moratorium on customs duties on electronic transmissions, regulation of cross-border data flows, competition policies and consumer protection.

Speaking at a high-level ministerial roundtable on digital trade during UNCTAD’s eWeek today (7 December), Deputy Director-General Johanna Hill said: “This report leverages the respective expertise of all five international organizations to shed light on where things stand with digital trade and what policymakers can do to make it a stronger force for growth and development.”

At “eWeek”, DDG Ellard emphasizes the importance of digital trade for development (WTO)

Deputy Director-General Angela Ellard participated on 5 December in the high-level roundtable on unlocking digital trade for inclusive development as part of the UN Conference on Trade and Development (UNCTAD) “eWeek” 2023. DDG Ellard discussed how digital trade can contribute to inclusive and sustainable development and how to strengthen the ability of developing and least developed countries (LDCs) to participate in digital trade.

DDG Ellard noted that digital trade facilitates trade more broadly and creates more opportunities for those who have been sidelined from the benefits of trade. Digital trade can also be a powerful tool for development as it drives growth and increased productivity, DDG Ellard said. This is especially important for those who remain on the margins of the global economy, including small businesses, women and LDCs.

WTO monitoring shows export restrictions persist even as trade-facilitating trend continues (WTO)

WTO monitoring shows that between mid-October 2022 and mid-October 2023, the value of world merchandise trade covered by new trade-facilitating measures far exceeded that affected by new trade restrictive measures, an encouraging trend at a time of uncertainty and tension in the global economy. Nevertheless, the WTO Director-General’s annual overview of developments in the international trading environment, presented on 7 December at a meeting of the Trade Policy Review Body, indicates that trade restrictions continue to weigh on global trade, with persistent export restrictions contributing to food price volatility.

pdf Report of the TPRB from the Director-General on trade-related developments (mid-October 2022 to mid-October 2023) (1.73 MB)

Quick links

Digital trade fuels Asia-Pacific’s growth, but progress is uneven (UNCTAD)

ECOWAS is developing a digital platform for the classification of Tourist Accommodation Establishments (ECOWAS)

AI can help humanity, but data and computing needed to enable its use (Engineering News)

Global energy crisis and government responses drive a significant fall in tax levels in OECD countries (OECD)


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