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South Africa: Budget must address revenue challenges, infrastructure investments (Engineering News)
While there has been a clear effort by the National Treasury to rein in spending and turn the trajectory of government’s financial performance around, the revenue side of the equation has not been able to deliver enough money to fully restore government finances, and this will be a key indicator that must be addressed in the Budget Speech, said business organisation Business Leadership South Africa (BLSA) CEO Busi Mavuso on February 19.
With revenue under pressure, the time at which revenue will exceed expenses before interest payments - a primary surplus - has consistently drifted outward, while gross debt as a percentage of gross domestic product (GDP) has continued moving upward.
“South Africa was meant to achieve a primary surplus during the current year, but there are doubts this will be achieved. If it does not, eyes will turn to whether it can do so in the year ahead, requiring clear spending discipline,” she said in her latest weekly newsletter.
Energy Council of South Africa joins World Energy Council (Engineering News)
The Energy Council of South Africa has become a member of the United Nations-affiliated global body the World Energy Council (WEC), which will serve to strengthen the standing of the Energy Council of South Africa and provide access to a range of international resources and global networks, as well as leading practice across global energy systems.
South Africa is currently grappling with an electricity crisis, which is compounding its triple challenge of poverty, inequality and unemployment, the Energy Council says. The crisis is receiving the highest attention from business leaders through the Business for South Africa partnership with government under the President’s direct oversight. South Africa has also made firm commitments towards transitioning to a net-zero future economy through the Paris Agreement and pending national emissions legislation, it says.
“The Energy Council and its members unequivocally support these commitments and, although the required energy transition will be a significant challenge, it is a significant opportunity for economic growth and clean industrialisation of South Africa.
Uganda signs $400m deal for green hydrogen fertiliser plant (The East African)
Uganda’s Energy Minister Ruth Nankabirwa on Thursday signed a joint development agreement with Industrial Promotion Services (IPS) and Westgass International for a green hydrogen fertiliser plant. The plant will be strategically located at Karuma, Kiryandogo District, within Bunyoro sub-region to leverage its proximity with the 600 megawatts Karuma hydropower plant.
According to Ms Nankabirwa, the significance of the project extends far beyond the realms of agriculture. She said the project aims to reduce the country’s dependence on imported fertilisers, therefore strengthening economic resilience and sovereignty with an estimated investment of about $400 million (Ush1.55 trillion).
Kenya woos Uganda, Rwanda and South Sudan to Mombasa port (The East African)
Uganda, Rwanda and South Sudan have supported Kenya’s move to offer end-to-end logistics services, even as clearing and forwarding agents protested the move that potentially locks them out of business. In the latest efforts to make Northern Corridor more efficient and serve landlocked countries to compete with Dar es Salaam port, officials of the three countries met with their Kenyan counterparts and agreed on a number of issues to make them use Naivasha inland container deport.
Kenya Ports Authority (KPA) had opposed the idea, but it has been given mandate to offer end-to-end logistics services after government completed procurement of more than 250 railway wagons and entered into an agreement with some transporters to offer last mile services through a tender advertised sometime last year. But clearing and forwarding agents say this is a return to compulsory railage of over 11.5 metric tonnes cargo destined for regional countries.
Creation of free zones between Algeria, five African countries in 2024 (Algeria Press Service)
In an address via video conference, at the 41st meeting of the Steering Committee of the Heads of State and government of the New Partnership for Africa’s Development (NEPAD), the president of the Republic said “Algeria will see, in 2024, the creation of free zones with sister countries, starting with Mauritania, then Sahel countries such as Mali and Niger, in addition to Tunisia and Libya.”
The president of the Republic also stressed Algeria’s commitment to meeting the goals of economic development and continental integration, and the importance of working for the improvement of the efficiency of the economic integration processes in Africa.
It also includes the improvement of regional production and trade networks, through the strengthening of production capacities, the continuation of the efforts to promote the industrial sector’s role and getting access to global value chains, by promoting the diversity of African industries, the president of the Republic said.
Malawi opens its borders to the world (CAJ News)
The recent removal of visa restrictions by Malawi is a major boost to tourism. Following the announcement, 79 nationalities can now enter the Southern African country visa-free and cost-free. Among these are 17 from the Asia-Pacific nations, 15 from Europe, 14 from the Americas and four from Africa and the Middle East.
Nationals of the 16-member Southern African Development region (SADC) region and 21-member Common Market for Eastern and Southern Africa (COMESA), in both instances except for those countries that subject Malawians to a visa requirement, also qualify for visa-free and cost-free entry.
Ghana implements ECOWAS free roaming initiative with Cote d’Ivoire (Citinewsroom)
The Minister for Communications and Digitalisation, Ursula Owusu-Ekuful, announced on Sunday, February 18, 2024, that Ghana has successfully implemented the ECOWAS free roaming initiative in collaboration with Cote d’Ivoire. The initiative aims to enhance integration and foster international connectivity between the two nations.
Speaking at a press briefing under the theme, ‘Digital Infrastructure to Bridge the Digital Divide,’ Minister Ursula Owusu-Ekuful revealed that the initiative, initially adopted in 2016, faced challenges in its implementation. However, she disclosed that Ghana and Cote d’Ivoire overcame obstacles and became the first ECOWAS member states to implement the ECOWAS free roaming in June 2023.
National Commodity Board Will Bring Stability To Food Prices (Leadership News)
The Lagos Chamber of Commerce and Industry (LCCI) has said the recent announcement regarding the federal government’s intention to establish a National Commodity Board has the potential to bring stability to food prices in Nigeria. The director-general of LCCI, Dr. Chinyere Almona stated that, “this initiative comes at a critical juncture when the rising cost of food has become a pressing concern for both the government and citizens, where food inflation has reached an alarming level, as highlighted by the National Bureau of Statistics data placing Nigeria’s food inflation at 33.9 per cent as at January 15, 2024.”
According to Almona, the chamber views this initiative as the government’s commitment to implementing effective short-term strategies to counteract subsidy removal and ensure immediate food supply and to deploying concessionary capital from the Central Bank of Nigeria (CBN) to the agricultural sector, especially, toward fertilisers, processing, mechanisation, and other key aspects, as a positive move that can enhance the overall productivity of the agricultural value chain.
Cocoa Prices Surge To Record High On Naira Depreciation (Leadership News)
Nigerian cocoa farmers and exporters are reaping big as global cocoa prices hit record high, thanks to the steep naira devaluation that has resulted in a sharp increase in the naira income from the export of the beans. The cost of cocoa – the key ingredient for making chocolate – has almost doubled since the start of the year, and quoted prices on the Internal Cocoa Organisation’s website reached a new historic high of US$5,874 a ton on February 8. This is because bad weather has battered harvest in top West African growers – Ivory Coast and Ghana, causing a supply shortfall and sending prices surging.
Locally, prices are also surging as the naira continues on a free fall hitting N1,534 at the Nigerian Autonomous Foreign Exchange Market (NAFEM) on Monday, data from FMDQ showed. Findings show that the local price of cocoa per ton at Matori cocoa warehouse in Lagos was N8 million per ton on Wednesday, 14 February, a 344 percent increase when compared to N1.8 million per ton in December of 2023.
Nigeria, UK trade hits N12trn as deal sealed to ease barriers (Daily Trust)
The value of trade between Nigeria and the United Kingdom has hit N12.3 trillion (£6.7bn) as at the end of 2023, Minister of Industry, Trade and Investment, Doris Uzoka-Anite, has revealed. The minister made the revelation on Tuesday in Abuja during the signing ceremony of the Memorandum of Understanding on the Enhanced Trade and Investment Partnership (ETIP) between the trade and investment ministry and the Secretary of State, Department of Business and Trade, Hon. Olukemi Badenoch.
“Nigeria and the UK have shared a long-term prosperity and have maintained long historic and commercial ties as the UK remains top trade partner both in import and exports amounting to £6.7bn pounds as at end of 2023,” she said. Speaking on the MoU, she noted that, “The first target is to reduce barriers to trade and which the ministry is diligently working to see that conducive atmosphere is created for businesses, especially now that Nigeria is working to get into AfCFTA that will lead to diversification of economy and improve exports while the second is to increase investment flows by improving ease of doing in furtherance with the eight-point agenda of the current administration.”
ECA and Google Sign Agreement to Foster and Accelerate Digital Transformation in Africa (UNECA)
The United Nations Economic Commission for Africa (ECA) and Google LLC (Google) have signed a landmark Memorandum of Understanding (MoU) to foster and accelerate digital transformation in Africa on the margins of the 2024 edition of the Africa Business Forum. The partnership is founded on the complementary expertise and strengths of both parties who wish to collaborate on activities to support ECA’s mandate such as digital development in Africa in line with the African Union Digital Transformation Strategy for Africa (2020-2030) and Google’s Digital Sprinters Framework, and to leverage the power of information and communication technologies (ICTs) for the benefit of Africa’s digital economy.
As a general framework for collaboration, the MoU will seek to further explore specific key areas of interest pertaining to digital skills development for Africa’s burgeoning young population, startup development, increasing financial inclusion, strengthening cybersecurity and online safety measures, and advancing AI policy research for policymakers on the continent.
ECA’s Executive Secretary, Mr. Claver Gatete, acknowledged Google’s pivotal role in improving Africa’s connectivity infrastructure, supporting Africa’s innovators and entrepreneurs, and building digital capacity in emerging technologies through skills development for researchers, students and educators.
EAC set to negotiate trade agreements with UK, UAE after EPA flops (The Independent Uganda)
At least seven countries have requested free trade arrangements with the East. African Community (EAC), as the bloc also intensifies efforts to expand the markets for its products. These countries include the United Kingdom, Singapore, Pakistan, and the United Arab Emirates (UAE), as well as China, Turkey, and Serbian. It follows the failure of the deal between the European Union (EU) and EAC dubbed the EU-EAC Economic Partnership Agreement (EPA) after the EAC states failed to agree amongst themselves on key issues. The EAC leaders have called on the relevant authorities for the prioritization of the negotiations with the seven countries.
Now, at the 43rd Meeting of the Sectoral Council of Trade, Industry, Finance, and Investment, the EAC line ministers approved negotiations of FTA Agreements between the EAC and the United Kingdom, United Arab Emirates, Pakistan, and Singapore. The Council also directed the EAC Secretariat to engage each of the four countries by July 30, 2024, with a view to the commencement of negotiations for FTA Agreements. The Ministers resolved that negotiations with Turkey, China, and Serbia will be undertaken after negotiations of FTAs have progressed with the first four.
NTBs cost region $16m, threatening intra-EAC trade (The East African)
The direct costs of non-tariff barriers (NTBs) in the East African Community (EAC) is estimated at $16,703,970, with the total trade impact being $94,918,000, a new report shows. The EAC Regional Meeting Committee report (2023) shows that trade has decreased by an average of 58 percent. Tanzania and Uganda have been cited as having the highest number of unresolved NTBs, with Tanzania having four unresolved issues, Uganda, three, and Kenya and South Sudan having one each as at February 2024.
Addressing the EAC Sectoral Council of Trade, Industry, Finance and Investment on the matter, EAC Secretary-General Peter Mathuki said that while in the financial year 2021/2022, intra-trade reached $8.7 billion, followed by an increase to $9.4 billion in 2022/23, NTBs continued to pose threat to trade in the region.
Small businesses cry foul over EAC payment system (The East African)
Small businesses have attributed their apathy towards the East African Payment System (EAPS) to its focus on high-value transactions between commercial banks, locking them out. They say that the system, in its current format, is a deterrent to cross-border interoperability of digital payments.
“This is a missed opportunity because micro entrepreneurs, 70 percent of whom are women, are the backbone of East Africa’s economy. Their limited digitalisation is hindering financial inclusion-commerce and cross-border trade in the region,” Netherlands-based think-tank European Centre for Development Policy Management (ECDPM) says in a discussion paper dated October 2023.
According to ECDPM, which is working on international co-operation and development policy in Europe and Africa, the EAPS is facing low uptake from regional governments, and this is hindering seamless digital payments interoperability — the ability of systems to exchange information and work together in a coordinated manner without end user’s involvement
Niger: Ecowas Prepares to Lift Sanctions on Niger - Report (allAfrica)
According to information from Jeune Afrique, regional organization Ecowas will lift the economic sanctions on Niger “soon” - a decision made after the coup on July 26, 2023, by General Abdourahamane Tchiani against elected president Mohamed Bazoum.
Negotiations between the Alliance of Sahel States (AES) and the mediators of the regional organization seemed to be at a standstill. At the end of January 2024, tension rose between the juntas, led by the Malian Assimi Goïta, the Burkinabè Ibrahim Traoré and the Nigerien Abdourahamane Tiani, and the West African civilian regimes, when the military-ruled countries first announced their departure from ECOWAS.
To break the deadlock, the heads of state at Ecowas have decided to take the first step - reportedly preparing to removed sanctions placed on Niger - the only country still subject to such measures. The announcement is expected to be made before Ramadan, which is scheduled to begin on March 10.
37th AU Summit updates
Education, Peace, Politics, Climate, Economy and International /Global Diplomacy in Focus at 37th AU Summit (African Union)
The 37th Ordinary Session of the Assembly of Heads of State and Government of the African Union (AU) kicked off on Saturday 17 February 2024. Holding under 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 event at the AU headquarters in Addis Ababa, Ethiopia, was well attended by African Heads of state and Government, and high-level representatives from the African continent and beyond.
Taking the floor, the outgoing Chair of the Union, President Assoumani, presented a comprehensive report of the achievements and activities undertaken on behalf of the AU during his leadership. He noted successes in peace and security, socio-economic development, youth and women’s empowerment, Africa speaking with one voice and taking common positions on global issues, enhancement of infrastructure, agriculture, climate change, education, health, and ICTs among others. He called for peace in the Middle East, reiterating the need for a two-state solution for Israel and Palestine.
In his welcome remarks, Ethiopian Prime Minister H.E. Dr Abiy Ahmed, underscored the importance of creating strong regional and continental platforms, emphasizing that these platforms are essential for addressing national development challenges from geopolitical, logistical, and security standpoints. He commended the African Union for its accession to the G20, as “marking a significant milestone” on the global stage.
Addressing the Assembly, AUC Chairperson, H.E. Moussa Faki Mahamat highlighted some critical concerns facing the continent, including peace, political and institutional instability, climate change, economic governance deficits, integration challenges, poverty, and the marginalization of women and youth in development and leadership processes. He stressed the urgent need for Member States to proactively engage with these issues, underscoring their importance in achieving the aspirations of Agenda 2063 for a transformed and prosperous Africa.
In highlighting the continent’s progress, H.E. Faki commended the successful advancement of institutional reforms and the strides made in regional integration, notably through the African Continental Free Trade Area (AfCFTA). He expressed satisfaction with the progress made in some areas including the Peace Fund, the African Common Positions on climate change, the reform of global governance, the financing of African peace keeping missions, and the notable accession of the AU to the G20 Forum.
Agenda 2063: Launch of 2nd Decade of Acceleration (AU)
The launch of the Second 10-Year Implementation Plan of Agenda 2063, also dubbed as the decade of acceleration (2024-2033), is a historic milestone for the African Union, its Member States, and all African citizens. It marks the beginning of the second decade of a collective effort to realise the vision of a prosperous, peaceful, and integrated Africa by 2063.
The Second 10-Year Implementation Plan of Agenda 2063 is a bold and ambitious roadmap for Africa’s transformation. It is a manifestation of the collective will and determination of the African people to shape their destiny. It is a reaffirmation of the African dream of unity, dignity, and prosperity for all. The plan outlines seven moonshots of how the continent aims to achieve key priorities, goals and targets to achieve in the next 10 years. By 2033, Africa wants to be prosperous, integrated, democratic, peaceful, cultured, people-driven and influential.
The plan also identifies flagship projects that will have a high impact, such as the African Continental Free Trade Area, the African Passport, the Grand Inga Dam, the Single African Air Transport Market, the African Virtual University, the Pan-African E-Network, and the African Outer Space Strategy. These projects will enhance regional integration, economic diversification, innovation, and competitiveness, as well as social inclusion and cohesion.
pdf Agenda 2063: Second Ten Year Implementation Plan 2024-2033 | Abridged version (6.58 MB)
AU faced with old crises as leaders plot to polish scorecard, roadmap (Nation)
At the opening session for the Executive Council of Ministers of Foreign Affairs, African Union Commission Chairperson Moussa Faki Mahamat pointed at the resurgence of military coups, pre- and post-election violence, humanitarian crises linked to war and the effects of climate change as old challenges the AU should address. Liesl Louw-Vaudran, Senior Adviser on the African Union at ICG said diplomacy is a better tool to nurture for the continental body to address the current crises but added: “The AU should also keep channels of communication open with countries in the Sahel and put Cameroon’s Anglophone conflict on the agenda.”
At the African Union Summit, President Lula defends the entry of more countries from the continent as full members of the G20 (G20 Brasil 2024)
During the opening of the 37th African Union Summit in Ethiopia, the Brazilian president also stressed that “without the Global South countries, a new cycle of world expansion will not be possible, with growth, a reduction in inequalities and environmental preservation, with the expansion of freedoms” and condemned the ongoing wars in the world.
See Speech by President Lula at the opening of the 37th African Union Summit
Towards a Prosperous Africa: A Conversation with UNDP Africa Regional Director Ahunna Eziakonwa (UNDP)
Following the 37th African Union (AU) Summit, in this interview Ahunna Eziakonwa, Director of the UNDP Regional Bureau for Africa, describes UNDP’s role in supporting communities and governments in advancing sustainable development across the continent, calls on African leaders at the AU Summit to prioritize education and development, and underscores the importance of partnerships in forging regional solutions to global challenges. To the distinguished leaders and decision-makers that gathered at the African Union Summit - Let us recognize that education is the most powerful currency in today’s knowledge economy, and it is through lifelong learning that we will continue to secure prosperity for Africans in Africa but also Africa’s place in the world.
Statements
Statement by Mr. Claver Gatete at the pre-launch of the African Union Theme for 2024 (UNECA)
President Ramaphosa concludes participation at the African Union Summit (The Presidency, South Africa)
AU today is fit-for-purpose, says Kagame as Ruto takes over reforms team (The New Times)
The African Union is better positioned to drive the interests of the continent than it was in 2016, when the body launched institutional reforms, President Paul Kagame said on Saturday, February 17 as he attended the 37th AU Summit in the Ethiopian capital Addis Ababa.
Kagame, who spearheaded the AU reforms for the past eight years, concluded his mandate and handed over to Kenya’s President William Ruto. “Almost $400 million has been mobilized. As a direct result, the United Nations Security Council recently decided to finance three-quarters of African Union peace operations for the first time. “This was only possible because the African Union today is more fit-for-purpose than it was. And we are getting better at defining our common interests, and advocating for them.”
See Report by President Paul Kagame on the Institutional Reform of the African Union – 17 February 2024
African countries to spend $74bn on debt service in 2024; negotiating new terms with private creditors failing - AfDB (MyJoyOnline)
African countries are expected to spend around $74 billion on debt service in 2024, the Macroeconomic Performance and Outlook 2024 by the African Development (AfDB) Bank has revealed. This would be up from $17 billion in 2010. According to the AfDB, some $40 billion, or 54.0% of total debt service is owed to private creditors.
“Except in Chad, the Democratic Republic of Congo, Gambia, and Mauritania, debt service costs in African countries was higher in 2020–22 than in 2015–19. Debt service payments have risen substantially in tandem with the growing share of debt owed to private creditors”.
This it said is a cause for concern because current debt restructuring negotiations are failing to reach agreement with private creditors. Presently, Ghana is negotiating a debt restructuring terms with its private creditors. The country is proposing about 40% haircut of up to $13 billion. The report pointed out that debt service costs have risen, narrowing the scope for government spending and increasing debt vulnerabilities. “External debt service payments as a proportion of government revenue are higher than before the COVID-19 pandemic in many countries”, it added.
See Africa’s Macro-Economic Performance and Outlook - January 2024
Fisheries subsidies chair circulates draft text to ministers as basis for MC13 negotiations (WTO)
The chair of the fisheries subsidies negotiations, Ambassador Einar Gunnarsson of Iceland, on 16 February circulated to ministers a draft text on Additional Provisions on Fisheries Subsidies, with disciplines on subsidies contributing to overcapacity and overfishing, as the basis for finalizing the negotiations on these issues at the 13th Ministerial Conference (MC13). The chair said the text, which draws on members’ proposals and discussions, reflects his best attempt to identify a balance most likely to build consensus.
Agriculture negotiations chair circulates revised text, aiming for outcome at MC13 (WTO)
The Chair of the WTO's agriculture negotiations, Ambassador Alparslan Acarsoy of Türkiye, circulated a revised negotiation text on 16 February. This text was submitted as a potential outcome document for ministers to consider at the organization’s 13th Ministerial Conference (MC13), due to take place in Abu Dhabi on 26-29 February. “The text represents my best efforts to help members in their desire to reach a successful outcome on agriculture at MC13,” the Chair said.
Political Fragility: Coups d’État and Their Drivers (IMF)
The paper explores the drivers of political fragility by focusing on coups d’état as symptomatic of such fragility. It uses event studies to identify factors that exhibit significantly different dynamics in the runup to coups, and machine learning to identify these stressors and more structural determinants of fragility—as well as their nonlinear interactions—that create an environment propitious to coups. The paper finds that the destabilization of a country’s economic, political or security environment—such as low growth, high inflation, weak external positions, political instability and conflict—set the stage for a higher likelihood of coups, with overlapping stressors amplifying each other.
Reform of global governance and international crises are on the agenda of the first G20 foreign affairs ministers’ meeting in Brasil (G20 Brasil 2024)
Rio de Janeiro will host one of the most important meetings in global diplomacy, with the participation of the world’s largest economies’ foreign affairs ministers for the G20’s first ministerial meeting in 2024, presided over by Brasil. The meeting, scheduled for the afternoon of February 21 and the morning of February 22 at Marina da Glória, takes place during a period of great geopolitical instability, with crises erupting in various parts of the world. Among the most pressing issues to be discussed are the situation in the Middle East and the Russian offensive in Ukraine, which continue to generate global concern over the humanitarian crisis and the geopolitical and economic consequences of the conflicts.
