Kenya’s Economic Performance Strengthened in 2023 Despite Continued Challenges (World Bank)

Kenya’s economic performance strengthened in 2023 despite continued challenges, with real GDP growth accelerating from 4.8% in 2022 to an estimated 5% in 2023. This is according to the 28th edition of Kenya Economic Update (KEU) which adds that the improved growth performance is attributed to a strong rebound in agriculture sector in 2023 which had faced a persistent and severe drought as well as a moderate growth in the services sector.

The recovery of agriculture has led to improvements in food supply and coupled with monetary policy tightening has helped reduce inflationary pressures. In 2023, tourism continued to expand, credit to the private sector improved and manufacturing activity is expected to improve from the anticipated growth in agro-processing sector.

Kenya moves closer to economic partnership deal with EU (The East African)

Kenya on Monday asked for the support of the East African Community (EAC) as it moves closer to sealing an Economic Partnership Agreement (EPA) with the European Union (EU) that will grant its exports duty-free status and unlimited access to the 27-member market bloc.

The deal signed in Nairobi was approved by the European Union Council last week and will now be presented to the parliaments of both sides for ratification before it subsequently enters into force. “This momentous step heralds a new era where Kenyan goods gain immediate and permanent duty and quota-free access to the European market. Simultaneously, European goods will also enjoy preferential access to the Kenyan market,” said Trade Cabinet Secretary Rebecca Miano before signing the deal.

The deal, once signed, will be a major boost to Kenya as it will enable the country’s exports to enter the EU duty-free and without quotas. The EU is Kenya’s second-largest trading partner and its most important export market.

Eacop pipes received at Dar es Salaam port ready for laying (The East African)

The East African Crude Oil Pipeline (Eacop) project coordinator has announced the arrival of the first 100 kilometres of pipes at the Dar es Salaam port, signalling the official start of the large-scale construction phase. Speaking during the inspection of the pipes, the coordinator, Mr Safiel Msovu, from the Tanzania Petroleum Development Corporation (TPDC) confirmed the arrival and stated that construction was ready to begin. He added that the project is on track and that both Tanzania and Uganda are committed to its completion.

Road connecting Kenya-Tanzania to be done by 2024 (The East African)

The road connecting Kenya and Tanzania that was commissioned under the East African Community last year is now over 35 percent done. The Bagamoyo–Tanga-Horohoro/Lunga Lunga-Malindi Road project that is under construction is being financed by the African Development Bank (AfDB), African Development Fund (ADF), European Union (EU) and Government of Kenya.

The project road-approximately 54 kilometres within Kenya is expected to be complete by 2024. Its construction began in 2021. On the Kenyan side, the road project will cost Ksh7.5 billion ($50 million) and it starts at the proposed New Mtwapa Bridge next to Mtwapa town.

Rwanda: 2023 Article IV Consultation (IMF)

Rwanda’s economic growth remained robust, but macroeconomic imbalances have intensified. Policy space to advance developmental objectives has been constrained by diminished policy buffers and repeated droughts and the severe floods in May 2023. Headwinds from the war in Ukraine, tightening of global financial conditions, consecutive weak agricultural seasons, and the structural decline of external concessional financing have put pressure on the level of international reserves. While the recalibrated policy mix is expected to rebuild external buffers, curb inflation, and improve debt sustainability, growth is likely to moderate from 8.2 percent in 2022 to 6.2 percent and 6.6 percent in 2023 and 2024, respectively, partly related to continued fiscal consolidation and tight monetary and exchange rate policies. The balance of risks to the outlook remains tilted to the downside, as further deepening of geopolitical fragmentation, another spike in global energy, food, and fertilizer prices, a steeper decline in trading partners growth, or a funding squeeze would weigh on the outlook.

Rwanda: Selected Issues (IMF)

Egypt, Ethiopia trade blame over failed dam talks (The East African)

Ethiopia and Egypt have traded blame for the failure of a fourth round of negotiations aimed at resolving a long-running dispute over a controversial mega-dam built by Addis Ababa on the Nile. Negotiations between Ethiopia and downstream neighbours Egypt and Sudan have yet to produce an agreement since construction of the $4.2 billion project began in 2011.

Egypt and Sudan fear the massive Grand Ethiopian Renaissance Dam (Gerd) will severely reduce the share of Nile water they receive and have repeatedly asked Addis Ababa to stop filling it until an agreement was reached. A fourth round of talks was held between Sunday and Tuesday in the Ethiopian capital.

$4-billion green hydrogen deal inked for Egypt (Engineering News)

Saudi-listed power generation and investor ACWA Power has signed a framework agreement that outlines the development of the first phase of the green hydrogen project in Egypt with a capacity of 600 000 t/y of green ammonia, with an investment in excess of $4-billion. This follows the sigining of a memorandum of understanding on December 7, 2022 and is intended to scale up to a second phase with a potential capacity of 2-million t/y.

“As a first mover in green hydrogen . . . we commend our partners for their bold step into producing the fuel for the future, for which there will be great demand in Europe and the rest of the world,” says ACWA Power CEO Marco Arcelli. He adds that Egypt is well-positioned to become one of the world’s top producers of green hydrogen.

Media in Africa Called Upon to Own The AfCFTA and its Implementation (allAfrica)

Top media personalities across Africa have called for the formation of a pan-African group of trade journalists who will champion the AfCFTA agenda as well as an African Chamber of Commerce led by individual countries. The group of journalists were of the view that the formation of such a body is the surest way to sensitise the continent on the merits of the AfCFTA. They spoke at a webinar hosted jointly by the African Prosperity Network (APN), organisers of the Africa Prosperity Dialogues (APD), and the Africa Continental Free Trade Area (AfCFTA) secretariat in Ghana on Tuesday (December 19, 2023).

In his opening remarks, the Founder/Executive Chairman of the Africa Prosperity Network (APN), Gabby Otchere-Darko, said that “the AfCFTA is arguably the biggest project for Africa” and every effort must be made to ensure its full implementation as seamlessly as possible. In his opinion, “the small trader in Lagos must understand the significance of being able to sell, especially with the support of technology, what she trades in another country on the African continent without having to pay any duties and other charges”.

For Africans to own the whole concept of free trade and to understand how relevant or impactful it can be to their livelihoods, Mr Otchere Darko underscored the important role of the media, saying, “This is where the media comes in and how we can get the media to unpack this free trade story of the continent is really what this conversation is all about”.

Is the labour force in Africa supply chain ready? (UNCTAD)

Over the last decade and a half, global supply chains have come under pressure due to geopolitical events, economic uncertainties and natural disasters. Disruptions have led to questions on how to strengthen supply chain resilience, with two key concepts advanced, namely, diversification and flexibility.

As global multinationals reconsider resilience, opportunities arise in the following two key areas: countries in Africa can gain entry into supply chains; and multinational firms have an opportunity to diversify into the African continent by strengthening or building new supplier, producer and customer base supply chains. However, as noted in this policy brief, it is imperative for economies in Africa to be adequately prepared and willing to adapt, to ensure participation in global supply chains.

Africa: Health Experts for Local Production of Vaccines (teleSUR)

On Monday, health experts and leaders called for more efforts to boost local production of medical products, especially vaccines, to address public health priorities in Africa.

According to official data, they made the call while speaking at a high-level workshop that gathered African health ministers, and representatives from the World Health Organization (WHO) and Africa Centers for Disease Control and Prevention (Africa CDC) in Kigali, the capital of Rwanda, to discuss strategies to enhance local production of medical products to address public health priorities in Africa.

Speaking at the workshop, Rwandan Minister of Health Sabin Nsanzimana opened the forum with a call to promote vaccine equity in Africa. “Local production and distribution are much more reliable solutions for the African continent, which currently outsources more than 90 percent of its vaccine, medicine, and therapeutic needs,” said Nsanzimana. “We are transitioning from commitment to action, moving into a new era of solutions.”

Africa Union ready to support member states to advance land policies aligned with the African Continental Free Trade Area’s objectives (AfDB)

At the conference convened in Addis Ababa, Ethiopia from 21-24 November 2023 under the theme, “Promoting Sustainable Land Governance in Africa for Accelerating Implementation of the AfCFTA,” Dr. Monique Nsanzabaganwa, Deputy Chairperson of the African Union Commission, said, “the African Union stands ready to support member states in advancing the land-related objectives outlined in the African Union Agenda 2063, the AfCFTA, and the African Union Land Policy Framework and Guidelines to foster an environment where land is a driver of prosperity and unity.”

The continent faces multifaceted land governance challenges, Nsanzabaganwa said. These range from tenure insecurity and land tenure systems to the need for sustainable land management practices as urbanization advances rapidly and climate change continues.

She urged the delegates to translate the outcomes of the conference into concrete national, regional, and continental actions. “We [African nations] must not only commit to the principles and discussions articulated here [at the conference], but also allocate resources, build partnerships, and implement policies that promote sustainable land governance and support the objectives of the [African Continental Free Trade Area] AfCFTA.”

UNCTAD study shows trade’s untapped potential in climate action (UNCTAD)

An UNCTAD study released at COP28 examines how 60 developing countries have integrated trade into their national pledges under the Paris Agreement, known as Nationally Determined Contributions (NDCs). The study, whose launch coincided with the summit’s inaugural “Trade Day” on 4 December, maps out how trade is systematically used in these national climate plans.

“The mapping exercise shows trade policies’ untapped potential in climate action,” said Miho Shirotori, head of UNCTAD’s international trade division. “Trade could play a much bigger role in cutting emissions and preserving resources by facilitating access to low-carbon technologies and environmentally preferable goods and services.”

The study identified 680 trade-related measures within the examined NDCs. In general, the study shows that most of them focus on increasing renewable energy, enhancing energy efficiency and promoting green value chains.

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Quick links

Africa’s Trade Landscape: The Need for a Strategic Pivot

Seeing new markets across borders

UNCTAD Transport and Trade Facilitation Series No. 21: Roadmap for Building a Trade Single Window

Items proposed for consideration at the next meeting of Dispute Settlement Body

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