Building capacity to help Africa trade better

tralac Daily News


tralac Daily News

tralac Daily News

Infrastructure deficit continues to hold back African mining (African Business)

These are interesting times for the African mining industry. Interest in the continent’s critical mineral reserves is soaring: lithium, copper, cobalt and nickel are vital to the energy transition and are opening up new mining opportunities across Africa. Meanwhile, however, the problems at South African rail network Transnet have hit the country’s bulk miners hard – and delays to new rail projects are hampering efforts to develop new mines in Central Africa.

Modest global economic growth should drive slightly increased demand for mining commodities overall in 2024. However, mining analysts CRU forecasts a 7.4% fall in the global volume of seaborne thermal coal traded in 2024, as international sentiment turns against coal-fired power generation. Coking coal production is expected to remain stable as a result of solid demand from the steel industry. There should be modest growth in demand for base metals in industrialised countries, with stronger growth for critical minerals. This should benefit African exporters but as always domestic constraints will have a bigger impact on the performance of African producers.

While critical minerals are a bright spot, there appears to be no end in sight to the problems currently plaguing the South African bulk mining sector. The industry is facing something of a perfect storm, with port congestion and a lack of rail locomotives exacerbating the impact of coal contract fraud and widespread vandalism of rail infrastructure.

CGA welcomes support from shipping company to boost citrus exports (Engineering News)

The Citrus Growers Association of Southern Africa (CGA) has welcomed the announcement that global liner shipping company Hapag-Lloyd will be helping to export citrus from the ports in Durban and Gqeberha. The new service will run by the end of May, in time for the bulk of the 2024 season’s citrus, until September.

The CGA’s role in facilitating Hapag-Lloyd’s entry into the market was undertaken with the aim of increasing both capacity and competition, to ensure long-term sustainability for the sector. Recent shipping price spikes owing to attacks on vessels in the Red Sea, as well as drought-related complications affecting the Panama Canal, have shown how exposed many fruit exporters are to increases in shipping rates. CGA believes any measure that can introduce some stability and competition into the shipping market is a step forward.

“The citrus industry and the broader economy need as much access to shipping as possible. Apart from keeping the market competitive and flexible, a new entrant is also welcome in the context of the large projected increase in citrus yield over the next few years,” CGA explains.

Busa seeks govt’s backing on private sector support to resolve energy, logistics crises (Engineering News)

Business organisation Business Unity South Africa (Busa) has outlined its expectations for President Cyril Ramaphosa’s State of the Nation Address tonight, with the first being a call for a clear acknowledgement on the partnership between government and business on energy, logistics and crime and corruption. It also expects a commitment from government to open up space for greater participation by the private sector in building, operating and maintaining critical logistics networks and in generating energy.

Busa highlights that there has been some progress in these areas, particularly in energy, but also in logistics, with the recent announcement that Transnet Freight Rail has taken delivery of seven sets of locomotive batteries procured by the Richards Bay Coal Terminal. The business organisation also wants a clear commitment to ensure that critical pieces of legislation, like the National Prosecuting Authority Amendment Bill will be processed expeditiously.

This is part of a broader commitment to consider legislation that promotes partnerships between the public and private sectors to enable the private sector to assist government to build its capacity to be an enabling government and deliver critical priorities, Busa explains.

Temporary poultry rebate in response to HPAI outbreak, Itac says (Engineering News)

Amid the creation of a temporary rebate on poultry products – as set out by Trade, Industry and Competition Minister Ebrahim Patel to the International Trade Administration Commission of South Africa (Itac) – Itac notes that the directive followed the Department of Agriculture, Land Reform and Rural Development (DALRRD) confirming the outbreak of Highly Pathogenic Avian Influenza (HPAI), which forced the culling of millions of fowls at great loss to key players across the poultry value chain.

Itac explains that the temporary rebate does not apply to anti-dumping duties and is not a full rebate in some product categories, such as bone-in cuts where importers will still have to pay a duty of 37% to ensure continued protection for domestic poultry producers against unfair trade practices and injurious imports.

Moreover, the volume of the tariff rate quota for the first six months was determined to be 86 000 t, which may be equally divided into two three-month periods, or 43 000 t per three-month period, with the permits administered on a three-month basis over the first two three-month periods at 43 000 t per three-month period. As stated in the guidelines, Itac points out that the issuing of permits under the rebate provision may be discontinued if domestic production has satisfactorily recovered from the HPAI outbreak.

Five-year multinational project kicks off to advance the circular economy in the textile industry (Engineering News)

“The World Bank estimates that nearly 20% of global wastewater comes from textiles,” said United Nations Industrial Development Organization Project Administrator, Franchesca Beru at an inception workshop for a five-year multinational project, titled Promotion of the circular economy in the textile and garment sector through the sustainable management of chemicals hosted by the National Cleaner Production Centre South Africa (NCPC-SA). The countries participating in the project are Lesotho, Madagascar and South Africa, with Ethiopia being a recent addition. The application of circular economy principles promises great benefits for companies, the sector, and the country.

“The workshop aimed to set the scene for the next five years. It was a platform for delegates to share knowledge, challenges and experiences around circularity in the textile and garment sector, with specific emphasis on chemical management and waste discards,” said Lesego Hlalethwa, the NCPC-SA workshop organiser and programme director.

She explained that the participating countries were selected based on their export contributions. “South Africa is a top 10 exporter of apparel as are Lesotho, Madagascar, and Ethiopia. We also based our selection on UNIDO’s previous experience in the countries. UNIDO has worked with South Africa and the other countries quite extensively on different projects. Regional integration was also a consideration,” she explained.

With African Development Bank support, Uganda takes first step to embedding circular economy model into national strategy (AfDB)

Uganda has taken a major step towards creating a circular economy to drive sustainable growth and green industrialisation in line with its Vision 2040 national agenda. With the support of the African Development Bank, the country launched the circular economy roadmap process on 31 January 2024 in the capital, Kampala. Representatives of the government and the African Development Bank attended.

The initiative, implemented jointly with the African Circular Economy Alliance (ACEA) and backed through the Bank’s Africa Circular Economy Facility (ACEF), will engage government policymakers, businesses and civil society organizations in efforts to tap the full potential of circularity to accelerate progress towards sustainable development goals and climate action.

Kenya imports from China in rare decline on hard economic times (The East African)

Kenya’s imports from China, the country’s leading source of goods, recorded a rare decline in 2023, signalling muted consumption during the year amid a high cost of living. Data from the General Administration of Customs of the People’s Republic of China (GACC), which is China’s equivalent of the Kenya Revenue Authority (KRA), shows that China exported goods worth $7.87 billion (Ksh1.26 trillion at current exchange rates) to Kenya last year. This marks a decline of 1.11 percent compared to the $7.96 billion (Ksh1.27 trillion) that the Asian giant shows it exported to Kenya in 2022. Such a decline is rare, and not even during the pandemic in 2020 when global trade ground to a near halt did it occur, according to Chinese customs data.

China is a major source of electronics, clothes, beauty products, steel, furniture, equipment and machinery. The decline in imports from the Asian giant indicates muted demand from local consumers amid high inflation that has reduced the spending power of Kenyans. According to the Central Bank of Kenya (CBK), non-food imports took a hit during the year, especially due to a slowdown in infrastructure-related spending as well as manufactured goods, oil, and chemicals.

Booming sectors: Where investors put their money (The Citizen)

Tanzania’s manufacturing, transportation and commercial building sectors are increasingly appealing to investors due to their potential for profit, personnel availability, policy framework, growing demand and perceived sector stability. The three sectors, according to the statistics of registered projects by the Tanzania Investment Centre (TIC), were top investors’ choices in the country in 2023, as the centre reports over $5.67 billion (estimated Sh14.38 trillion) in total capital injected. Data showed that the three sectors contributed more than two-thirds of the total capital injected from January to December 2023, at nearly $3.9 billion.

University of Dar es Salaam (UDSM) Prof Jehovaness Aikaeli said investors look at sectors that can generate lucrative returns, those with the potential to bring profit and those with a high probability of growth over time. “But they also consider the availability of inputs, the global economic situation, and the specific economic conditions of the sector, as well as the security of their investments in the country,” he said.

Experts predict food import inflationary impact as Burkina Faso et al exit ECOWAS (The Business & Financial Times)

Experts are predicting a possible import inflationary effect on food commodities from Burkina Faso, Niger and Mali as a result of those countries’ withdrawal from the ECOWAS bloc. Global Credit Rating (GCR) – a subsidiary of Moody’s – has indicated that leaving ECOWAS will have a general inflationary impact in the domestic markets of all the three countries, which will inevitably be transferred to the price of food commodities imported into neighbouring countries including Ghana.

It says the movement of people across various borders and trading in these countries will likely be limited – a situation that could possibly promote commodity hoarding with price hikes.

Ghana currently imports 90 percent of its fresh tomato from Burkina Faso, with a national consumption demand in excess of 800,000 metric tonnes per annum, according to data from the Ghana Incentive-Based Risk-Sharing System for Agricultural Lending (GIRSAL). Trade data from the Ghana Vegetable Producers and Exporters Association show that the country imports some US$400million worth of tomato from Burkina Faso each year. Burkina Faso and Mali also account for almost 70 percent of Ghana’s livestock import.

I want to build a Digital Ghana for inclusive economic growth - Bawumia (MyJoyOnline)

Vice President and Flagbearer of the NPP, Dr Mahamudu Bawumia, has declared that his objectives as President would include building what he has labelled Digital Ghana, which will be ready for the ongoing global digital revolution for inclusive economic growth in Ghana. Addressing the nation on February 7, to reveal his vision and priorities for Ghana, he revealed several policies in other sectors but stressed the indispensability of a Digital Ghana. The programme he said will be the anchor, to ensure Ghana is not left behind in the technological demands of the modern world.

Dr. Bawumia stated further that his Digital Ghana vision is also aimed at applying technology to transform key sectors of the economy including agriculture, healthcare, education, manufacturing, and the financial sector for a prosperous digital economy which will make Ghana a digital hub and also create jobs for the youth.

“I want to build a Ghana where we leverage technology, data and systems for inclusive economic growth. I want us to apply digital technology, STEM, robotics and artificial intelligence for the transformation of agriculture, healthcare, education, manufacturing, fintech and public service delivery.”

Ghana Shippers’ Authority participates in Ghana Expo 2024 in Tanzania (The Business & Financial Times)

In line with Ghana’s strategy to increase trade within Africa under the Africa Continental Free Trade Area (AfCFTA), the Ghana Shippers’ Authority (GSA) in collaboration with the National Coordination Office (NCO) of the AfCFTA participated in the Ghana Expo 2024 in Tanzania from Wednesday 24th January to Sunday 28th January 2024, at the Mlimani City Conference Centre in Dar es Salaam in Tanzania.

The event dubbed, “Driving the AfCFTA Momentum: Enhancing Ghana – Tanzania Trade Relations,” seeks to foster business partnerships, explore trade prospects, and promote investment between the two countries through structured ‘business to business’ matchmaking sessions. The event is considered as Ghana’s contribution to the Guided Trade Initiative (GTI) under the AfCFTA, launched in October 2022 which enabled Ghanaian shippers to test trade documentation under the AfCFTA.

Mrs. Monica Josiah, Head of Shipper Service and Trade Facilitation department of the GSA, underscored the critical role of shipping in the success of the AfCFTA. She indicated the success of AfCFTA will be impeded if deliberate measures are not made to provide the necessary shipping infrastructure and streamline processes in the shipping value chain. She also stressed the need for traders to comprehend import and export requirements and procedures of the African countries they intend to trade with, to facilitate the smooth flow of goods under the AfCFTA. She urged exporters and importers in Ghana to seek necessary guidance from the GSA in matters relating to cargo shipment.

Shipping costs at Mombasa Port set to rise (The Citizen)

Kenya Ships Agents Association (KSAA) on Wednesday said importers should expect higher charges from this week as stakeholders assess the increasing insecurity from Yemen Houthis’ claim of fresh Red Sea attacks on British and American ships. KSAA Chief Executive Officer Juma Ali Tellah said shippers are concerned about the escalating conflict along the Red Sea route, and its potential repercussions on the business community and consumers in East Africa.

The worry was always expected to bring a new burden. But the actual cost increment wasn’t known since December when Houthis first fired the first missile. “Despite efforts to normalise freight rates following events such as the Covid-19 pandemic and the Russia-Ukraine War, the ongoing attacks by Houthi Rebels present a persistent challenge.” “Major shipping lines, including those represented by KSAA, are responding by rerouting vessels around the Cape of Good Hope, a costly alternative that directly impacts the business community and consumers in East Africa,” said Mr Tellah.

He added, “The rerouting of ships will result in longer shipping distances, causing an upward surge in freight rates and disturbances in the supply chain. Delays in the smooth movement of goods are expected due to extended transit routes.”

Egypt’s trade deficit rises by 5% in November 2023 (Dailynewsegypt)

Egypt’s trade deficit reached $3.07bn in November 2023, compared to $2.92bn in the same month of the previous year, marking a 5% increase, according to the monthly bulletin of “Foreign Trade Data” issued by the Central Agency for Public Mobilization and Statistics (CAPMAS). The bulletin attributed the rise in the trade deficit to the decline in export value by 20.6%, which amounted to $3.21bn in November 2023, down from $4.04bn in November 2022. The decrease in export value was mainly due to the lower prices of some commodities, such as ready-made clothes by 4.5%, petroleum products by 23.7%, crude oil by 28.6%, and fertilizers by 59.6%.

On the other hand, some commodities witnessed an increase in export value in November 2023, compared to the same month of the previous year, such as various pastries and food preparations by 26.6%, fresh fruits by 4.2%, flat-rolled products of iron or steel by 324.5%, and carpets and kilims by 12.0%.

Nigeria joins US, EU, others to launch TRS for port operations (Tribune Online)

Nigeria joined leading global economies like the United States of America, the European Union, and Asia on Thursday to launch the Time Release Study (TRS), aimed at enhancing the nation’s trade facilitation regime, at the Tin-Can Island Port in Lagos. The launch event, which took place in Lagos, marked a pivotal moment in Nigeria’s commitment to streamlining Customs operations and fostering a conducive environment for international trade.

Minister of Finance, Wale Edun, said: “TRS falls within the domain of the Federal Government’s renewed hope agenda, demonstrating President Bola Ahmed Tinubu’s commitment to unleashing full economic recovery for the country. TRS also redefines the best approaches to creating an enabling environment for businesses, in addition to providing excellent services for economic cooperation. A conducive port environment is crucial for the facilitation of international trade.

“Efficient Customs processes are paramount for achieving cost-effective goods clearance and indeed assuring us of efficiency in the system. So, for Nigeria not to be left behind in the global world of development, we need to key into this initiative. I want to encourage all stakeholders in the port to rally around Customs to ensure the success of the TRS.”

Africa’s Future Hangs in the Balance as Leaders Convene in Addis Ababa (BNN Breaking)

The 37th Ordinary Session of the Assembly of the Heads of State and Government of the African Union (AU) is set to take place on February 17-18, preceded by the 44th Ordinary Session of the Executive Council on February 14-15. With the theme “Educate an African fit for the 21st Century: Building resilient education systems for increased access to inclusive, lifelong, quality, and relevant learning in Africa,” the summit aims to address one of the most pressing issues facing the continent today.

Access to quality education remains a significant challenge in many parts of Africa, with millions of children still out of school. The summit will explore ways to build resilient education systems that can withstand the various shocks and stresses that African countries often face, from conflict and displacement to climate change and disease outbreaks.

Beyond education, the summit will also cover a range of other critical issues, including peace and security, trade and integration, agriculture and climate change, governance and human rights, and gender and youth empowerment. Each of these topics carries its own weight and significance, and the discussions that take place over the course of the summit could have far-reaching implications for the lives of millions of Africans.

Mining Indaba: Africa’s critical minerals lay the ground for mutually beneficial partnerships with industrialised nations (Daily Maverick)

Critical minerals like lithium, cobalt, copper and rare earth elements are all the rage because they are crucial ingredients of green technologies such as batteries for electric vehicles and wind turbines. But “critical for whom?” World Bank mining expert Sven Renner asked during a panel discussion at the indaba. He stressed that there were two parties in mining partnerships. Industrialised countries had a legitimate interest in securing supplies of minerals, including critical minerals.

“While African mining countries — as they tell us again and again — have an interest that goes beyond supplying industrialised countries with their minerals,” Renner said, “the question is, how do we find that common ground … that would really allow for a partnership?” To ensure the African side also benefitted, mining investors needed to align with the mining countries’ policies and priorities, including creating jobs, leveraging the mining sector for broader development, particularly infrastructure development such as energy and transportation, and adding value to raw minerals.

Renner noted that about $5-trillion a year would have to be invested in the energy transition if the world hoped to meet the target of limiting the global temperature to 1.5°C above the pre-industrial level.

Poverty, debt and climate risks: UNCTAD deputy urges stronger support for middle-income countries (UNCTAD)

UNCTAD Deputy Secretary-General Pedro Manuel Moreno spotlighted on 6 February the challenges and potential of middle-income countries during a speech at a high-level conference in Rabat, Morocco. Mr. Moreno said these nations lack the global support they need, despite being home to about 75% of the global population and 62% of the world’s poor and facing mounting debt and worsening climate vulnerabilities. “If we are committed to a world of shared prosperity, these countries need our support,” Mr. Moreno said.

Mr. Moreno highlighted the essential role of industrial policies in helping some nations avoid the trap, pointing to East Asian success stories like the Republic of Korea. These countries leveraged their existing industrial skills to develop and expand new production and export sectors, moving into more complex and high-value areas like steel and electronics. “At the heart of these success stories were targeted industrial policies,” Mr. Moreno said. “While such policies became out of fashion a few years ago, there is renewed interest in them, and for good reasons.”

Mr. Moreno emphasized the key role industrial policies can also play in capitalizing on these countries’ “green” potential. “There is immense potential of renewable energies and the energy transition in middle income countries,” he said, pointing to Morocco as an example. The country now hosts one of the largest wind farms in Africa and has the potential to become a key exporter of solar energy. But realizing this potential requires quick access to clean technologies.

Quick links

Could the EU’s trade deal with Kenya strengthen the African Continental Free Trade Area? (EUROPP)

Africa-to-Europe value chains: How nearshoring can mitigate Europe’s migration crisis and aid energy transition (ReliefWeb)

America should not allow its trade programme with Africa to die (Financial Times)

While the world is in a state of flux, all eyes are on Africa (African Business)

How Africa can finance its climate change strategy (African Law & Business)

Economists call for negotiating trade benefits at WTO MC13 (Business Post)

Stitching future apparel manufacturing digital supply chain (The Edge Signapore)

The West is turning inward. Here’s how the Brics+ countries can surpass it (The National)


Email This email address is being protected from spambots. You need JavaScript enabled to view it.
Tel +27 21 880 2010