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South Africa’s trade balance is thinning and in need of urgent resolve (The Mail & Guardian)
A review of South Africa’s trade data for the period 2018 to 2022 revealed that South Africa remained a net exporter in value terms, peaking the positive balance during this period to R444.53 billion in 2021 from lows of R15.21 billion in 2018 and R31.80 billion in 2019. In 2022, the positive balance dropped by just over 60% to R192.21 billion.
Although the country remained a net exporter, the rate of import growth in value terms (2022 versus 2021) increased at a rate (32.6%) close to three times the export rate (10.9%). This wouldn’t warrant the raising of alarm bells because the country stayed a net exporter. What does raise alarm bells is that it would have been expected that value exported in rand terms should have increased based on the local currency’s depreciation when compared to the dollar or the euro.
South Africa to present ‘compelling’ investment case at WEF (Engineering News)
South Africa’s delegation to the World Economic Forum (WEF) will present the country’s investment case to international investors, which Finance Minister Enoch Godongwana has described as “compelling”, despite the challenges the country is grappling with. He was speaking to the media at a pre-WEF briefing, in Johannesburg, on January 11, ahead of the forum being held in Davos, Switzerland, next week. He emphasised that South Africa’s key focus at the forum will be investment, as this drives growth.
Godongwana acknowledged that the country has myriad of structural challenges impacting on the economy, and that the delegation is cognisant of these, mainly, electricity, logistics, crime and corruption. However, he averred that there are strategies and roadmaps in place to address these.
Namibian President Accuses South Africa of Industrial Imbalance in SACU (BNN Breaking)
In a break from the usual diplomatic approach, Namibian President Hage Geingob has publicly addressed the issue of industrial imbalance within the Southern African Customs Union (SACU). Geingob pointed fingers at South Africa, accusing the nation of contributing to under-development within the union. These remarks were made during a year-end media briefing in Windhoek, marking a significant shift in the region’s approach towards tackling its industrial challenges.
Geingob’s public accusation signifies a departure from the diplomatic decorum typically embraced by SACU member states. In the past, these states have highlighted the importance of regional unity and cooperation for promoting investment and development across the union. However, the Namibian leader’s candid remarks underscore his growing dissatisfaction with the current state of industrial development in the region.
Raw minerals, tobacco dominate Zim’s export list (New Zimbabwe)
RAW minerals and tobacco continued to dominate Zimbabwe’s export list in the third quarter of the year, the Reserve Bank of Zimbabwe (RBZ) third-quarter report has established. The central bank report shows that during the period, gold injected US$502,5 million being the largest export earner constituting 26% of the total exports. The Platinum Group of Minerals (PGM) raked in US $403.8 million.
Kenya’s exports surge within EAC and Comesa in Quarter 3 (The Exchange Africa)
Kenya’s exports to her East African Community (EAC) neighbours increased in the third quarter of 2023, as the country continued to push volumes amid efforts to cut the high import bill. This comes as Africa increasingly remained Kenya’s biggest export market, even as economies edge closer to operationalizing the African Continental Free Trade Area (AfCFTA).
According to the Kenya National Bureau of Statistics (KNBS), the value of Kenya’s exports to the EAC totaled $496.7 million (Ksh77.9 billion) up from $431 million (Ksh67.7 billion) in the corresponding period in 2022.
Kenya’s Africa trade surplus hits new high of Sh121 billion (Business Daily)
Kenya’s exports to Africa exceeded imports by Sh121 billion in nine months through September, hitting record-high levels that signal increased deals on the continent for traders amid President William Ruto’s aggressive diplomatic offensive.
Official data shows traders sold goods worth Sh324.79 billion to African countries in the review period, a 20.86 percent jump over Sh268.73 billion in a similar period the year before. The jump in earnings from exports on the continent came at a time expenditure on imports fell a modest 2.85 percent year-on-year to Sh203.79 billion, the first drop since the Covid-19 shutdowns three years earlier.
This resulted in surplus for Kenya’s merchandise trade in Africa more than doubling after rocketing 105.21 percent to Sh121.01 billion from Sh58.97 billion in a similar period in the prior year, the highest on record based on publicly-available data published by the Kenya National Bureau of Statistics (KNBS).
US formally removes Uganda from Agoa (The East African)
The United States has officially struck off Uganda and three other African countries as beneficiaries of the African Growth and Opportunity Act (Agoa), effectively ending Kampala’s ability to export certain commodities to the US duty-free.
In a decree dated December 29, President Joe Biden said he had “determined” that the four countries “do not meet the requirements” necessary to allow them to continue benefiting from the trade deal, effecting his earlier stated plans to delist them. “Accordingly, I have decided to terminate the designations of the Central African Republic, Gabon, Niger, and Uganda as beneficiary sub-Saharan African countries for purposes of section 506A of the Trade Act, effective January 1, 2024,” read the statement by the US President.
In an October 2023 letter to the speaker of the US Congress expressing his intention to remove the four countries from the list of Agoa beneficiaries, Mr Biden said Uganda has “engaged in gross violations of internationally recognised human rights.”
How Uganda Agoa ban impacts East Africa investments (The East African)
Goods, Service Imports On Upward Trend (Tanzania Daily News)
The imports of goods and services increased to 16,172.7 million US dollars in the year ending October, higher than 16,060.1 million US dollars in the previous year, with the main drivers being machinery, industrial transport equipment, motorcars for household and fertilisers.
According to the Bank of Tanzania (BoT) monthly economic review for November, the import of refined white petroleum products, which accounted for 19.7 per cent of the total imports bill of goods, fell by 16 per cent resulting from both price and volume.
Tanzania and EAC at the centre of regional transmission expansion (The Citizen)
Ranked by KPMG behind only South Africa and Nigeria, Tanzania has confirmed its status when it comes to trade and investment. This year, the fifth Tanzania Energy Cooperation Summit (TECS 2024) will showcase Tanzania’s renewable energy investment potential. The country is expecting to see a 6% GDP growth by 2025. This will see hundreds of millions, if not billions, of dollars of investment, targeted towards infrastructure, hydropower, LNG and solar projects in recent years.
Over 150,000 Tonnes of Cashews Exported Through Mtwara Port (Tanzania Daily News)
Over 150,000 tonnes of raw cashewnuts have been exported through the Mtwara Port from October last year, it has been learnt. The cashewnuts were collected from the regions of Mtwara, Lindi and Ruvuma during the 2023/24 harvest season, said the Port’s Manager, Mr Fernand Nyathi on behalf of the Tanzania Ports Authority (TPA) Director General, Plasduce Mbossa. Mr Nyathi said that by the end of this January, 2024, the port is expected to handle over 200,000 tonnes of raw cashew nuts.
Tanzania to become India’s second-biggest trading partner in Africa (The Citizen)
Outgoing Indian High Commissioner, Binaya Pradhan, sat down for a final interview where he detailed key ties between Tanzania and India, specifically highlighting trading milestones that will see Tanzania become India’s second-biggest trading partner on the continent. The interview was hosted by The Citizen’s Managing Editor, Mpoki Thomson.
Port of Lobito Records Increase in Ship Movement (Angola Press Agency)
Three hundred and fifty-one ships docked at the Port of Lobito, handling one million 332 thousand and 451 tons of miscellaneous cargo in 2023. Data were revealed on Monday by the Chairman of the Board of Directors of this company, Celso Rosas, during the New Year’s greetings ceremony, showing an increase of 7.57 percent, compared to 2022. However, he said that there was a reduction of 14.90 percent in terms of tons of cargo.
In terms of revenues, he said that the port collected, in 2023, more than 13 billion and 800 million kwanzas. According to the official, compared to the same period of the previous year, there was a decrease of around 5.72 percent in revenues, as the company had collected more than 14 billion and 700 million Kz. “This reduction was mainly based on the impact of port tariffs, the fluctuation of the currency, as well as the international situation that, in a way, has affected world maritime trade”, explained Celso Rosas.
Maize price drop excites poultry farmers (The Business & Financial Times)
The Ghana National Association of Poultry Farmers (GNAPF) has said the current drop in the price of maize – the main commodity for poultry feed – is a sign that the sector will recover in 2024. The relief comes after several years of concerns over the high cost of production, which includes the price of raw materials for animal feed production – particularly from 2022 and throughout the whole of last year.
GNAPF’s President, Victor Oppong Adjei, told B&FT that the price for a 50kg bag of maize, which sold at GH¢280 throughout last year, is now sold at GH¢200. The drop in price of maize, he said, positively impacted the farmgate price of chicken during the festive season.
Nigeria’s Terms of Trade Records 4th Consecutive Quarterly Decline (Vanguard)
The Nigeria’s Terms of Trade (ToT), for all commodities, recorded a light decline of 0.03 percentage points in the third quarter of 2023, Q3’23. TOT measures a the value of the country’s trade with other countries where a decline indicates higher value of imports against exports. The Q3’23 performance indicates a lower rate of decline with the implication that the fourth quarter, Q4’23, may likely show the indices in positive territory.
Findings from the National Bureau of Statistics, NBS, data on Commodity Prices Indices and Terms of Trade showed that the ToT has been on a negative trend since Q3’22 of last year when it recorded a fall of 0.50 percentage points from an increase of 0.11 percentage points in Q2’22.
Ethiopia to Lift Tariffs for 5,700 Goods (Ethiopian Business Portal)
The Ministry of Trade and Regional Integration revealed that the African Trade Ministerial Council has accepted Ethiopia’s proposal to trade 5,700 goods, constituting 90% of products, within the African Continental Free Trade Area (AfCFTA). According to the AfCFTA plan, Ethiopia will include these items in the non-tariff scheme after seven years, with negotiations planned for the remaining 10% of goods. The goal is to initiate a bilaterally guided trade initiative with AfCFTA member countries to enhance the competitiveness of Ethiopian products in the African market.
China Becomes One of Largest Importers of Ethiopian Coffee (ENA)
China became one of the largest importers of Ethiopian coffee, Ethiopian Ambassador to China Tefera Derbew said. The ambassador delivered a keynotes speech at “The China (Pu’er) International Coffee Expo” held in Yunnan province, Pu’er city with the theme of “Pu’er Coffee, Shared Worldwide.”
Coffee is part and parcel of Ethiopia’s social fabric, and any guest visiting Ethiopia will certainly feel the profound coffee culture deeply embedded in the identity of the Ethiopian people, ambassador Tefera added.
He also stated that, “being one of the world’s three main beverages, coffee is like a bridge, connecting all countries in the world, crossing borders and races, narrowing the distance between people in the global village, and letting culture plug in wings through coffee cultural exchanges, promoting the great integration and development of excellent cultures among all human beings in the world.”
Ethiopia ‘Secures’ Access to Sea After Deal With Somaliland (VOA)
Ethiopia and the self-declared republic of Somaliland have signed a “historic” initial agreement that will allow landlocked Ethiopia to have access to the Red Sea, Prime Minister Abiy Ahmed’s office announced Monday, 1 January 2024.
The announcement was made in Addis Ababa where Somaliland President Muse Bihi Abdi is visiting. According to Ethiopia, Ahmed and Abdi signed the “Memorandum of Understanding,” or MoU, for the partnership in the Ethiopian capital. It said the MoU is “intended to serve as a framework for the multisectoral partnership between the two sides.”
“The Memorandum of Understanding shall pave the way to realize the aspiration of Ethiopia to secure access to the sea and diversify its access to seaports,” said a statement issued by Ahmed’s office.
Somalia Law ‘Nullifies’ Port Deal Between Ethiopia and Somaliland (VOA)
Somalia’s president has signed a law “nullifying” a contentious agreement between Ethiopia and Somaliland in a largely symbolic gesture of his government’s displeasure over the deal to grant port access.
President Hassan Sheikh Mohamud said the law voided the “illegal” pact giving landlocked Ethiopia long-sought access to the Red Sea through Somaliland, a separatist northwestern region over which Somalia exercises little real authority. The passage of the bill on Saturday evening “is an illustration of our commitment to safeguard our unity, sovereignty & territorial integrity as per international law,” the president wrote on X, formerly Twitter.
Benin lifts suspension of imported goods transiting to Niger (RFI)
Benin has lifted its suspension of imported goods transiting to Niger through the port of Cotonou in a move that follows five months of sanctions on the coup-hit country. The measure was taken “in view of the substantial improvement in the operational conditions for handling goods at the port of Cotonou” the port’s director general Bart Van Eenoo said on Wednesday.It comes almost a week after Benin President Patrice Talon called for relations to be swiftly re-established between his country and neighbouring Niger.
Comoros WTO accession package ready for formal adoption at MC13 (WTO)
WTO members negotiating the accession of Comoros on 9 January 2024 agreed by consensus, ad referendum, on the terms of the country’s WTO membership, paving the way for the least-developed country (LDC) to join the organization. With the conclusion of the Working Party’s mandate, the accession package for Comoros will be submitted to ministers for a formal decision at the WTO’s 13th Ministerial Conference (MC13) in Abu Dhabi on 26-29 February.
Union of the Comoros: 2023 Article IV Consultation (IMF)
Economic recovery is underway, supported by the resumption of social activities, tourism, and ongoing public investment projects. Inflation has decelerated, in line with normalizations in international oil and food prices thus far in 2023. However, risks to the outlook are elevated due to the fragile context and global uncertainty; dependence on imports, remittances, and foreign aid means the economy remains highly vulnerable to external shocks. In this context, the economic reform program supported by the Extended Credit Facility (ECF) seeks to reduce fragility and increase economic resilience by building fiscal buffers, reducing debt vulnerabilities, strengthening the financial sector, and mitigating corruption risks.
SADC stepping up efforts to address Anti-Money Laundering and Financing of Terrorism (SADC)
The Southern African Development Community (SADC) has commenced the process to operationalise the Committee on Anti-Money Laundering and Combating the Financing of Terrorism (AML/CFT) as per the provision of Annex 12 of the SADC Protocol on Finance and Investment. The inaugural meeting of the Committee is planned to take place in February 2024.
The operationalisation of the SADC AML/CFT committee follows the decision made by the Ministers of Finance and Investment at their meeting held in the Democratic Republic of Congo in July 2023. This decision was informed by the recommendations from the two studies commissioned under the Support to Improving Investment and Business Environment (SIBE) Programme, namely the (i) Assessment of the level of risk for the implementation of the FATF Recommendations and (ii) Assessment of the national authorities’ capacities to combat money laundering and terrorist financing structures and proliferation financing and the national authorities’ capacity building programme.
The East African Community (EAC) is gearing up for the New Year with a stronger focus on fostering intra-regional trade, resource mobilisation and integrating the newest Partner States. EAC Secretary General, Hon. (Dr.) Peter Mathuki, highlighted the need to enhance intra-regional trade by optimising the implementation of the EAC Customs Union and Common Market protocols. Dr. Mathuki further emphasised the need to work together to eliminate Non-Tariff Barriers (NTBs) hindering intra-regional trade and expressed optimism about increasing intra-regional trade in East Africa to at least 40% over the next five years.
New court case exposes EAC’s weak conflict resolution measures (The East African)
Uganda has sensationally sued Kenya at the East African Court of Justice for denying government-owned oil marketer Uganda National Oil Company (Unoc) a licence to operate and handle fuel imports at the Mombasa Port headed for Kampala.
Uganda says in the suit that Kenya’s Energy and Petroleum Regulatory Authority (Epra) has denied it a licence to import fuel through the Kenyan port and also use the pipeline infrastructure to transport it.Now all eyes are on the regional court, one that is bogged down by operational and financial problems, and which does not sit regularly to dispense with cases.
EAC’s External Trade Grows As Member States Imposes More Barriers (Modern Diplomacy)
East African Community (EAC) member states are trading more with countries outside the bloc owing to persistent trade disputes and non-tariff barriers (NTBs), which are choking intra-regional trade as well as undermining the regional integration agenda, reports James Anyanzwa for The East African.
Disclosures by the EAC Secretariat through its final draft Trade and Investment Report (2022) shows a new trend where member countries are doing increased business with the West African countries, Japan, USA, India, China and the United Arab Emirates (UAE).
So far, the EAC has resolved 23 out of 33 NTBs. Provisional data shows that EAC imports from the UAE surged by 81.9 percent to $8.01 billion in 2022 from $4.4 billion in 2021 and imports from India increased by 20.9 percent to $5.85 billion from $4.84 billion in the same period.
2024 comes with dangers, opportunities in Greater East Africa (The East African)
This new year is fraught with dangers but also opportunities in the Greater East African region. The region has been dealing with protracted crises, terrorism, difficult transitions and elections, but also a cocktail of interconnected hot button issues: High cost of living, a financing crisis, a growth crisis and a climate crisis.
The Gulf States will continue to play a major role not only in the Horn of Africa, as they compete for influence through proxies to secure the Red Sea. The competition between Saudi Arabia and the UAE over the Red Sea will see alliances shift, but most importantly peace processes will have to go through Riyad and Abu Dhabi. All these crises, however, also present an opportunity to find pragmatic ways forward and to continue to push for the African agenda of peace and security, governance, regional integration, voice and effective representation.
In 2023, the African Development Bank Group provided more than $2 billion to North Africa to finance a series of key operations in a range of strategic sectors. The Bank’s Director General for North Africa Mohamed El Azizi, said, 2023 has been an exceptional year: “We have been able to launch flagship operations that build crisis resilience and foster shared growth. We are proud to contribute to improving the daily lives of millions of North Africans”.
Almost $800 million has been approved by the Bank for projects in Morocco in 2023. These include a project to finance and develop health infrastructure in rural areas, and another to support local enterprises. Egypt, meanwhile, received just over $677 million in 2023, including nearly $134 million to finance a series of public reforms aimed at unlocking the potential of the private sector and accelerating economic diversification.
Customs Service partners with AfCFTA Secretariat for better trade initiative (OnePage Africa)
The Comptroller-General of the Nigeria Customs Service, Bashir Adewale Adeniyi MFR, has expressed readiness to partner with the African Continental Free Trade Area (AfCFTA) Secretariate for enhanced trade facilitation in the African Continent. The CGC made this known on Monday, when he received members of AfCFTA at the Customs Corporate Headquarters in Abuja. Lamenting the low trade volume in Africa, CGC Adeniyi said the NCS fully understands the importance of balancing trade facilitation and revenue while pointing out that Africa’s share in global trade is around 3–4 percent.
Africa Collective to kick off week-long agenda in partnership with the African Continental Free Trade Area (AfCFTA) Secretariat (Business Insider Africa)
The series of activities will include thematic engagement sessions - on commodities, health and capital investments: Beginning on Monday, 15 January, with a welcome luncheon & roundtable dedicated to the topic ‘Paving the Way: Commodity-led Industrialization on the African Continent; followed by a breakfast roundtable in partnership with Novartis entitled ‘Moving the needle: From health ‘spend’ to healthcare as an investment’ on Tuesday, 16 January; and finally, a breakfast roundtable themed ‘Unleashing potential: Africa’s place in attracting future allocation of capital pools’ in partnership with Standard Bank Group on Wednesday, 17 January.
Intra-African trade provides an opportunity for inclusive economic growth (Africa Renewal)
Africa’s growing role in global trade dynamics (ZAWYA)
US-Africa trade relations 2024 (The Exchange Africa)
5 Major Ports in Africa That Are Strengthening African Trade (Global Trade Magazine)
Evaluating China’s new tariff-free policy for 6 Africa countries (Daily Trust)
Experts have said China’s latest tariff-free policy for additional African countries may be a catalyst for new opportunities amid criticisms about the trade imbalance and concerns over Nigeria’s position on such economic programmes.
The Chinese government had on December 25, 2023, announced tariff-free access for goods to Angola, Gambia, Congo, Madagascar, Mali and Mauritania on 98 per cent of taxable products. This brought the number of African countries on the zero-tariff policy to 27, as Beijing had earlier announced similar cuts for 21 other African countries including Ethiopia, Niger, Benin, Mozambique, Sudan, Burkina Faso, Guinea Bissau, Sao Tome and Principe, Tanzania, Uganda, Zambia, Rwanda, Togo, and Djibouti.
World Economic Situation and Prospects 2024 (United Nations)
The world economy continues to face multiple crises, jeopardizing progress towards the Sustainable Development Goals (SDGs). Although global economic growth outperformed expectations in 2023 with several large economies showing remarkable resilience, simmering geo-political tensions and the growing intensity and frequency of extreme weather events have increased underlying risks and vulnerabilities. Furthermore, tight financial conditions also pose increasing risks to global trade and industrial production.
Global Economy Set for Weakest Half-Decade Performance in 30 Years (World Bank)
Reforms to boost investment and strengthen fiscal policy could help turn the tide —the slowest half-decade of GDP growth in 30 years, according to the World Bank’s latest Global Economic Prospects report.
By one measure, the global economy is in a better place than it was a year ago: the risk of a global recession has receded, largely because of the strength of the U.S. economy. But mounting geopolitical tensions could create fresh near-term hazards for the world economy. Meanwhile, the medium-term outlook has darkened for many developing economies amid slowing growth in most major economies, sluggish global trade, and the tightest financial conditions in decades. Meanwhile, borrowing costs for developing economies—especially those with poor credit ratings—are likely to remain steep with global interest rates stuck at four-decade highs in inflation-adjusted terms.
Data Blog - High demand for energy-related critical minerals creates supply chain pressures (WTO Blog)
Critical minerals, such as cobalt, copper, lithium, nickel and rare earths, play a crucial role in the production of clean energy technologies, from wind turbines to electric cars. Over the past 20 years, annual trade in energy-related critical minerals has increased from US$ 53 billion to US$ 378 billion. However, the high demand for clean technology goods is putting pressure on the supply chains for these minerals.
Critical minerals are particularly in demand for the production of batteries for electric cars, with each battery requiring as much as 200kg of critical minerals. The battery sector is responsible for 70 per cent of the global demand for cobalt. It also requires aluminium, copper, lithium, nickel and rare earths. Rare earth elements are needed in particular for magnets, a vital component in many electrical machines, especially the most energy-efficient ones.
While 2024’s risks loom large, their worst outcomes are not inevitable (World Economic Forum)
Climate change, demographic changes, technology and geopolitics. These are the changing ‘structural forces’ that are making the world less stable, according to the World Economic Forum’s Global Risks Report 2024. The fallout is already affecting billions of lives. Extreme weather, AI-generated mis- and disinformation, a cost-of-living crisis, cyberattacks and socio-political polarization are already upon us.
