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Botswana: Budget in Q1 surplus but FY deficit still looms (Mmegi Online)
The national budget recorded a P5.2 billion surplus in the first quarter of the financial year, a performance expected to unravel later as the Finance Ministry still expects an overall P5.7bn deficit in the fiscal year.
Figures from the Ministry show that the surplus in the first quarter of the 2023-24 financial year, a period which covers the months between April and June, was powered largely by Southern African Customs Union (SACU) receipts and mineral revenues. The P5.2 billion surplus compares with a surplus of just P645.3 million for the first quarter of 2022-23 and a deficit of P1.4 billion for the same period in 2021-22.
Namibia: Staff concludes 2023 Article IV Consultation (IMF)
Namibia has shown resilience to the negative shocks from the COVID-19 pandemic and Russia’s war in Ukraine. Output has recovered to the pre pandemic level, inflation has fallen below 6 percent, and expectations remain anchored. Official reserves, at 4.7 month of imports in September, exhibit adequacy consistent with the peg to the rand. Prospects are brightened with discovery of oil and gas reserves. At the same time, Namibia is poised to benefit from the global pivot to green energy through its signature Green Hydrogen Project. Meanwhile, the challenge of improving public sector efficiency and reducing the large wage bill, not only for the sake of preserving debt sustainability, but also for the Namibian people to benefit the most from these new developments, remains paramount. Elections are scheduled for 2024.
Cote d’Ivoire: Poverty Reduction and Growth Strategy (IMF)
The implementation of the 2012-2015 and 2016-2020 National Plans of Development Plan (NDP) allowed the country to make significant progress and consolidate economic growth, despite a global context marked by trade tensions, a drop in commodity prices and the COVID-19 pandemic. Thanks to the implementation of far-reaching structural reforms, the economic growth rate has averaged around 8% over the 2012-2019 period, making the Ivorian economy one of the most dynamic in Africa and the world. Per capita income also doubled during this period, reaching 2,287 USD in 2020, one of the highest in West Africa.
Continued Reforms to Boost Macro-Economic Stability in Zimbabwe (World Bank)
Economic growth is projected to slow to 3.5 percent in 2024, a decrease from 4.5 percent in 2023, as agricultural output is expected to suffer from depressed global growth and the predicted erratic and below-average rainfall caused by the El Niño weather pattern, according to the fourth World Bank Zimbabwe Economic Update (ZEU) launched today.
According to the report, titled Electrifying Growth Through Reliable and Universal Energy Access, Zimbabwe’s economy has seen a strong rebound since the COVID-19 pandemic, making it one of the fastest-growing economies in the Southern African Development Community (2021, 2022, and, so far, in 2023). In previous years, Zimbabwe faced increased global turmoil, while expansionary monetary policy has put initial pressure on inflation and the exchange rate. Yet, since June 2023, the Government proactively tightened monetary policy to bring down inflation and the parallel market premium. It also extended the use of US dollars as legal tender until 2030, further reducing policy uncertainty.
Tanzania govt urges cement producers to explore opportunities in AfCFTA (The Citizen)
The minister for Industry and Trade, Dr Ashatu Kijaji, has challenged cement manufacturers to tap opportunities in the African Continental Free Trade Area (AfCFTA) as production increases. Dr Kijaji, who met the cement manufacturers, said annual cement production in Tanzania currently stands at 11 million tonnes, while domestic demand is estimated at 7.5 million tonnes.
“The government desires that the nation’s cement manufacturers produce cement with international quality and standards so that it can meet the needs and competition of the domestic and foreign markets,” she said. According to the National Bureau of Statistics (NBS), cement production, consumption, and exports rose by 14.9 percent, 9.8 percent, and 43.2 percent, respectively, last year.
Malawi Country Economic Memorandum Calls for Significant Policy Reforms to Achieve Higher Rates of Growth (World Bank)
Malawi’s per capita economic growth has been insufficient to reduce high and stubborn rates of poverty, according to the latest World Bank Country Economic Memorandum (CEM). The report argues that the pathway to achieve Malawi 2063, while achievable, is increasingly narrow and requires a fundamental shift in policy. Malawi, facing a “poly-crisis” from 2020-2023, has experienced negative per capita GDP growth, a surge in poverty levels, and severe food insecurity affecting more than one in five Malawians. The CEM identifies four core challenges that have hindered growth: declining exports, low savings and investment, slow structural transformation out of subsistence agriculture, and high vulnerability to climate.
The CEM, published every five years, provides a deeper analysis of Malawi’s economic situation. This edition, “A Narrow Path to Prosperity” highlights the urgent need for Malawi to adopt a new development model that can break this pattern and put the country back on track to achieve its development goals.
Nigeria: Turning the Corner, time to move from reforms to results (World Bank)
The Government of Nigeria avoided a fiscal cliff by implementing bold reforms, including ending the gasoline (premium motor spirit, PMS) subsidy, and shifting to a unified, market-reflective foreign exchange (FX) rate. These essential reforms entail painful adjustments. They have led to an increase of retail gasoline prices by an average of 163%. The naira has depreciated against the US dollar by approximately 41 % in the official market and by about 30% in the parallel market. To reap the benefits of the bold reforms and difficult but necessary economic adjustments now underway, it is essential to sustain and fully implement the reforms and take complementary actions.
This is the key message from the December 2023 edition of the Nigeria Development Update, titled “Turning the Corner”. The report adds that the recently launched cash transfer intervention to cushion the impact of increased gasoline prices on the poor and vulnerable is providing welcome relief to a growing number of households, with 5 million households expected to be covered by the end of December.
Iran exports non-oil goods worth $116.3m to Ghana in 7 months (Tehran Times)
Iran exported non-oil commodities valued at $116.3 million to Ghana during the first seven months of the current Iranian calendar year (March 21-October 22), the spokesman of Trade Development Committee of Iran’s House of Industry, Mining and Trade announced. Ruhollah Latifi also announced that the Islamic Republic imported products valued at $5.9 million from Ghana in the seven-month period.
Among the African trade partners of Iran in the first seven months of this year, Ghana was the first export destination of the Iranian products, and the third source of import to the country, he added.
Complaints about NTB still stands at 43.75% in the regional bloc (Monitor)
The East African Community Secretariat has said it still has unresolved complaints of the Non-Tariff Barriers standing at 43.75 percent by June 2023, which still affects the follow-up trade in the regional bloc. The NTBs pose a major problem for traders and producers, as they can reduce profits and limit market access. NTBs include issues that can hinder trading effectively such as discriminatory requirements for special licenses and permits, excessive paperwork, complicated customs procedures, and bureaucratic delays at borders.
“A significant number of NTB complaints were addressed (56.25%) and resolved within the given timeframe. However, a notable portion of complaints, specifically (43.75%) were still in progress by the end of June 2023,” EAC said in a press statement it issued over the weekend. The EAC secretariat said a recent EAC Regional Meeting Committee (RMC) report (2023) estimated the direct costs of NTBs at $16.7 million and total trade impact at $94.9 million decreasing trade by an average of 58 percent.
However, on the other hand in the press statement, EAC said since 2017, EAC has resolved 89.5% of the reported NTBs (EAC Time Bound Programme report, 2023).
Somalia’s inclusion in the EAC is multifaceted (Monitor)
Somalia’s Integration into the EAC is a catalyst for Economic Development, Security Cooperation, and Regional Unity.
The East African Community traces its roots back to the early 1960s when the East African Common Services Organisation laid the groundwork for regional cooperation. However, it was in 1967 that Kenya, Tanzania, and Uganda officially established the East African Community with the signing of the Treaty for East African Cooperation. The initial vision was to create a customs union and a common market, fostering economic integration and shared development goals. Over the years, the EAC has evolved, facing challenges such as political differences and the dissolution of the community in 1977.
Nevertheless, the commitment to regional cooperation prevailed, leading to the re-establishment of the EAC in 2000. The revitalised community expanded its membership, reflecting a renewed dedication to creating a prosperous, stable, and integrated East Africa.
NITDA Drives Digital Transformation For Seamless Trade Integration In West Africa (Science Nigeria)
The National Information Technology Development Agency (NITDA), operating under the Federal Ministry of Communications, Innovation and Digital Economy, is spearheading initiatives to dismantle physical trade barriers and foster economic growth across borders using digital technology. The director-general of NITDA, Mallam Kashifu Abdullahi delivered this vision during a goodwill message at the inaugural ‘Nigeria – Cote D’Ivoire Business Roundtable and Exhibition,’ held in Abuja on the margins of the 64th ECOWAS Summit.
In his welcome address, the director of the economic, trade and investment department at the Federal Ministry of Foreign Affairs, Amb. Akinremi Bolaji emphasised the significance of the event in assessing Nigeria’s readiness and collaboration between inter-agencies and the public-private sector. The goal is to expand the presence of Nigeria’s private sector in Cote D’Ivoire and the broader West African sub-region.
Bank of Botswana, ECA, and Frontclear strive to create a dynamic interbank money market (UNECA)
The United Nations Economic Commission for Africa (ECA) in collaboration with Bank of Botswana and Frontclear have launched a Money Market Diagnostic Framework (MMDF) to boost the country’s financial system. The MMDF provides critical insights for the holistic development of the money and interbank market, while identifying impediments and making sequential recommendations. The framework was launched at a workshop organized by the ECA, Bank of Botswana and Frontclear.
Speaking at the launch, Kealeboga Masalila, Bank of Botswana Deputy Governor, noted that a stable and inclusive money market was a prerequisite to increasing depth in local currency bond markets. Mr. Masalila acknowledged the role of interbank lending as the nucleus of the money market, where banks borrow and lend to each other using financial instruments such as repurchase agreements (repos) and hedge balance sheet risks through derivatives. The Bank of Botswana and banks are keen to develop the interbank market to deal with immediate liquidity concerns and to transmit changes in monetary policy.
As an emerging market, Botswana faces systemic challenges such as market segmentation and over-reliance on the banking sector as the only local source of liquidity. Besides, there are legal and regulatory challenges in enforcing global best practice legal documentation. However, the removal of these challenges can improve liquidity and the depth of the domestic and international investor base.
The ECOWAS Commission, the Implementing Agency for the Abidjan-Lagos Corridor Highway Development Project, will on December 15th, 2023, organize the twentieth (20th) Project Ministerial Steering Committee Meeting in Cotonou, Republic of Benin to assess the level of progress made so far, take critical decisions and to further fast track the implementation process.
The Honourable Minister for Infrastructure and Transport of the Republic of Benin will host the meeting while the Chairperson of the Ministerial Steering Committee and Minister of Works and Housing of the Federal Republic of Nigeria, Engineer David Nweze Umahi will chair the meeting.
The two-day expert meeting will review the progress made in the project since the 19th Experts and Steering Committee meeting held in May 2023 in Accra, Ghana and will outline measures to fast-track the processes leading to the completion of the project study phase and transit to the construction of the Highway.
The Board of Directors of the African Development Bank Group has approved various financing structures valued at $696.41 million for Burundi and Tanzania to start Phase II of the Joint Tanzania-Burundi-DR Congo Standard Gauge Railway (SGR) Project.
The Bank Group’s financing is intended to construct 651 kilometers on the Tanzania–Burundi railway line. The work will consist of the development of a single electrified standard gauge track. This will be subdivided into three lots: Tabora–Kigoma (411 km) and Uvinza–Malagarasi (156 km) sections in Tanzania; and the Malagarasi–Musongati section (84 km) in Burundi. This standard gauge railway project will be connected to the existing railway network of Tanzania, providing access to the port of Dar es Salaam. In total, 400 kilometers of rail infrastructure has already been built in Tanzania from Dar es Salaam to Dodoma since the start of the first phase of the project. The rest of the section from Dodoma to Tabora is under construction.
Africa must drive domestic revenue mobilization for sustainable development (UNECA)
African countries need to effectively manage their resources to drive domestic revenue mobilization for sustainable development, a regional meeting on tax expenditure governance in Africa, heard. Opening a one-day workshop on issues of tax expenditure governance in Africa, Economic Commission for Africa (ECA) Director for the Macroeconomics and Governance Division, Adam Elhiraika, noted that Africa faced a huge financing deficit which has constrained its ability to achieve the Sustainable Development Goals (SDGs) and Agenda 2063. Besides, the continent was battling high debt levels, some estimated at 64 percent of the GDP. Therefore, it is imperative for African countries to raise domestic funding if they are to meet the SDGs and achieve Agenda 2063.
“Effective governance of all resources including tax incentives that are provided in different forms by governments with the objective to attract investment is needed,” Mr. Elhiraika said, raising concern that “often these tax expenditures are not well targeted, not well measured and not well covered and they end up abused in many cases, fueling rent seeking, corruption and massive losses to governments.”
Africa is making strides in its visa openness policies boding well for cross-border travel, ease of movement and trade in 2024 and beyond. The Africa Visa Openness Index 2023, published on Tuesday, reveals much progress since the seventh edition of the report was published in December 2022.
In 2023, data from the report shows that 50 countries improved or maintained their 2022 score, with only 4 countries scoring lower. Since the first report was published in 2016, 36 countries have improved their score on the index. Forty-two (42) countries extend visa-free entry to citizens from at least 5 other African countries, while 33 countries do so to citizens of at least 10 countries. Four countries – up from three last year – have eliminated all visa requirements for African travelers. They are Rwanda, Benin, The Gambia, and Seychelles. Embracing liberal visa policies will not only facilitate seamless travel but also contribute significantly to enhanced trade in goods and services, cross border investment and shared prosperity.
AfDB wants intensified efforts at curbing illicit financial flow in Africa (Businessday NG)
In the ongoing battle to safeguard Africa’s financial systems, experts are sounding the alarm for increased measures to combat illicit financial flows. The continent faces a significant challenge as it grapples with the detrimental impact of funds siphoned away through corruption and other illicit activities.
Recognizing the urgency of the situation, experts are advocating for heightened efforts and strategic interventions to curb the flow of illicit finances, aiming to fortify Africa’s economic stability and foster sustainable development. Lamin Barrow, Director General of the Regional Development and National Governments (RDNG) at the African Development Bank Group, delivered a warm welcome at the closing session of the Executive Training Program on “Enhancing Accountability, Transparency, and Curbing Corruption and Illicit Financial Flows in Africa.” The event, commenced from December 11 to 13, marked the final module before the graduation of the first cohort of the Public Finance Management Academy for Africa (PFMA) Public Finance Management Executive Training Series.
SA trade with China grows over 35 times (The Citizen)
From $1.6 billion (about R30.5 billion) to nearly $57 billion is how the volume of the bilateral trade between China and South Africa has grown – 25 years after establishing diplomatic ties. China and South Africa on Tuesday celebrated the years of diplomatic relations with the theme “forward together: Into the golden era of China-South Africa relations”.
Chinese ambassador to SA Chen Xiaodong said by last year, the China-SA trade volume grew over 35 times to $57 billion – equivalent to one-fourth of China-Africa trade. “South African beef, citrus, red wine, oysters, rooibos tea and other products, are popular among Chinese consumers. “Chinese enterprises have invested over $25 billion in South Africa, which is 100 times more than 1994, having created more than 400 000 jobs,” said Chen.
US hails ‘record’ year for trade with Africa (Eyewitness News)
The United States has struck hundreds of deals worth $14.2 billion with African nations over the past year, government officials said on Wednesday, as Washington seeks to counter China’s growing influence on the continent. The 547 new trade and investment agreements represent a 67% increase on 2022 in the number and value of closed deals, said British Robinson, coordinator for the US administration’s Prosper Africa trade and business initiative.
“We have had a record-setting year for US-African relations,” added Judd Devermont, President Joe Biden’s top Africa advisor. Devermont and Robinson were speaking at a virtual media briefing marking the first anniversary of a summit with African leaders, where Biden pledged to go “all in” on the continent. The announcement comes as Washington seeks to deepen engagement with Africa, where China has enjoyed rising clout.
Nations at COP28 in Dubai approved earlier on Wednesday a roadmap for “transitioning away from fossil fuels” – a first for a UN climate conference – but the deal still stopped short of a long-demanded call for a “phaseout” of oil, coal and gas. Reacting to the adoption of the outcome document, UN chief António Guterres said that mention of the world’s leading contributor to climate change comes after many years in which the discussion of this issue was blocked. He stressed that the era of fossil fuels must end with justice and equity.
In his statement, Mr. Guterres said the science is clear in that limiting global heating to 1.5°C, one of the keystone targets set in the landmark 2015 the Paris Agreement, “will be impossible without the phase out of all fossil fuels”, and this is being recognized by a growing and diverse coalition of countries. The negotiators at COP28 also agreed on commitments to triple renewables capacity and double energy efficiency by 2030 and made progress in relation to adaptation and finance. Other progress was also made in relation to adaptation and finance, including – including the operationalization of the Loss and Damage Fund, even though financial commitments are very limited, according to the Secretary-General.
COP28: African Development Bank, international partners commit to Climate Resilient Debt Clauses (AfDB)
The African Development Bank Group announced its adoption of climate resilient debt clauses (CRDCs) on 12 December, joining major creditors and international development banks at a COP28 session organized by the UK, Barbados and the InterAmerican Development Bank under the auspices of the Bridgetown Initiative.
Borrowing nations will get a debt payment respite up to two years when disasters strike. Seventy-three countries worldwide, including many of the most climate vulnerable, now urge all creditors to adopt urgently CRDCs terms to provide financial security against accelerating climate impacts. “We now have five multilateral development banks on board,” said UK Minister for Development and Africa Andrew Mitchell. “I look forward to how other multilateral development banks will match this offer next year,” Mitchell added. The MDBs are responding.
The Gambia, UK formally accept Agreement on Fisheries Subsidies; UK pledges to the Fund (WTO)
The Gambia and the United Kingdom deposited their instruments of acceptance of the Agreement on Fisheries Subsidies on 13 December, advancing the tally of formal acceptances to the halfway mark required for entry into force. Baboucarr Ousmaila Joof, Minister of Trade, Industry, Regional Integration and Employment of the Gambia, and Andrew Mitchell, Minister of State (Development and Africa) of the UK presented the instruments of acceptance to Director-General Ngozi Okonjo-Iweala. The UK also announced its pledge to donate up to GBP 1 million (approximately CHF 1.11 million) to the WTO Fisheries Funding Mechanism.
DG Okonjo-Iweala: It’s time to “dramatize” Geneva to deliver concrete outcomes for MC13 (WTO)
In her report to a meeting of the WTO’s Trade Negotiations Committee (TNC) on 12 December, Director-General Ngozi Okonjo-Iweala said it was incumbent upon WTO members to deliver concrete outcomes at the upcoming 13th Ministerial Conference (MC13) in Abu Dhabi next February. To achieve this, negotiators “need to conclude as much of the negotiations we can in Geneva” before the start of MC13.
“The world economy is not in good shape,” the Director-General told members in her capacity as TNC Chair. “We know people are bearing the brunt of slow growth, volatile prices, climate impacts and debt pressures. We have a responsibility to contribute to efforts to reinvigorate growth and opportunities for people everywhere.” For this reason, “we must have a substantive and meaningful Ministerial with concrete results,” she said.
Small business group engages with academics, private sector to discuss MSME inclusion (WTO)
Two papers from the Philippines assessed the impact of free trade agreements on the manufacturing performance of small businesses in the Philippines and reviewed MSME provisions in the Asia-Pacific Economic Cooperation (APEC) economies. As part of the group’s ongoing efforts to engage with the private sector and other stakeholders, members heard from the International Trade Centre (ITC), the Digital Cooperation Organization (DCO) and a business owner operating in Barbados.
WTO members discuss proposals on work programme on e-commerce (WTO)
In their last dedicated discussion of the year on the Work Programme on E-commerce on 8 December, WTO members discussed text proposals for a ministerial decision to be considered at the 13th Ministerial Conference (MC13) in February 2024. The proposals address progress under the Work Programme, the moratorium on the imposition of customs duties on electronic transmissions and the development dimension of e-commerce.
Bhutan exits UN list of least developed countries (UNCTAD)
“UNCTAD has continuously supported LDCs to embark on a sustainable development path and participate in the benefits that enhanced productive capacities bring to job creation, income generation, productivity, and value addition,” said UNCTAD Secretary-General Rebeca Grynspan. Looking ahead, UNCTAD cautions that the measurable progress justifying an LDC’s graduation doesn’t necessarily equal economic transformation or the sophistication of support needed to steer the economy through its next phase of development.
