SADC boosts support towards Namibia in developing a CBM National Strategy (SADC)

The Southern African Development Community (SADC), in collaboration with the Namibia Revenue Agency (NamRA) convened a workshop in Windhoek, Namibia from 29th February 2024 - 1st March 2024 to validate the Draft Coordinated Border Management (CBM) National Strategy.

The Namibia CBM National Strategy demands a coordinated approach by border control agencies in seeking greater efficiencies in managing the flow of legitimate trade and commerce, while satisfying compliance requirements and national security interests. The Strategy will assist Namibia in simplifying and harmonising trade documentation and border procedures, as well as enhancing the predictability of control procedures based on risk management of border agencies.

Tanzania raises budget to $19bn on polls, Afcon costs (The East African)

Tanzania’s Finance Ministry has proposed a Tsh49.34 trillion ($19.35 billion) budget for the 2024/2025 financial year, an 11 percent increase from the Tsh44.4 trillion ($17.41 billion) in 2023/2024.A big chunk of expenditure is expected to go the elections and preparations for the 2027 Africa Cup of Nations (Afcon) finals, which Tanzania is hosting jointly with Kenya and Uganda.

According to budget guidelines announced by Finance Minister Mwigulu Nchemba this week, recurrent spending will go up to Tsh33.55 trillion ($13.15 billion), from Tsh29.17 trillion ($11.44 billion) in the current fiscal year, as the government prepares for local government elections in October and the 2025 general election.

Nigeria Considers Possibility of ECOWAS Single Currency as Naira Dips (Legit.ng)

Nigeria’s finance minister and coordinating minister of the economy, Wale Edun, remains hopeful about the feasibility of the proposed monetary union and single currency for the West African Monetary Zones (WAMZ).This comes despite the recent failure of member states to meet the established convergence criteria.

The development follows an earlier report by Legit.ng that Nigeria has yet to decide on the next course of action for the adoption of the Economic Community of West African States (ECOWAS) single currency, “Eco”, by member states. This is subsequent to the failed promise by ECOWAS to begin the use of the regional bloc’s single currency in 2020.

Edun’s optimism on the eventual use of the single currency follows the release of the latest progress report on the project, which revealed a decline in performance scores for WAMZ member states. According to BusinessDay, in 2023, these states not only fell short of meeting the criteria for adopting a single currency but also saw their performance score decrease to 29.2% from 41.7% in 2022. The single currency initiative entails each member state meeting four key criteria: maintaining an inflation rate of 5%, sustaining a fiscal deficit GDP ratio of 4%, limiting deficit financing by the central bank to 10%, and ensuring a sufficient level of gross official foreign exchange reserves equivalent to at least six months of imports.

Thirty-one countries to start trading under AfCFTA Agreement this year (Engineering News)

Amid the increasing importance of intra-African trade, 31 countries are expected to start trading under the African Continental Free Trade Area (AfCFTA) Agreement by the end of the year, South Africa’s Department of Trade, Industry and Competition Trade Branch Africa bilateral economic relations chief director John Rocha said during a March 14 Transport Forum webinar. Supply chain advisory company Sincpoint CEO Lebo Letoalo highlighted that the AfCFTA is the largest free trade area globally connecting 1.3-billion people across Africa.

She added that the AfCFTA was aimed at transforming Africa into “the global powerhouse of the future,” adding that the agreement would progressively eliminate tariffs on intra-African trade, making it easier for African businesses to trade within the continent and benefit from the growing African market.

The AfCFTA was also aimed at encouraging increased beneficiation in Africa. “We need to get to a point where we reduce commodity dependence and foster diverse resilient economies.” However, Letoalo pointed out that a lack of efficient transport and logistics infrastructure added about 30% to 40% to intra-African trade costs, thereby stifling growth and hindering progress.

Hence, the AfCFTA provides opportunities for investment in the expansion and upgrade of Africa’s logistics infrastructure, including ports, roads, railways and warehouses, to facilitate the seamless movement of goods across Africa and link it to the global market. Automated systems will also be integrated into the supply chains to enable faster and more cost-effective transportation.

See also: SA, Ghana must push AfCFTA to improve trade (IOL)

“Africa Needs Trade, Not Aid” (Liberiann Observer)

With a population of 1.2 billion people, the African continent should prioritize intra-trade and investments amongst its people and countries, Speaker of the House of Representatives, J. Fonati Koffa, has urged African leaders and other stakeholders on the continent. He emphasized the importance of prioritizing intra-trade and investments within Africa to boost economic growth. He advocated for open borders, a single currency, and the leveraging of technology as key factors in promoting trade over aid on the continent.

“As I am given this platform or any other, I will continue to preach the dual theme of open border and single currency because a continent of 1.2 billion people should depend on trade not aid,” the Speaker told stakeholders in a special statement at the 12th African Leadership Magazine Persons Of The Year Awards ceremony held in Addis Ababa, Ethiopia, on Friday. “It is my submission that for us to build resilient African economies, we need open borders, embrace, invest and leverage technology and move faster towards a single African currency.”

Green hydrogen: The future of African industrialisation? (ECDPM)

While exports present opportunities to some African countries, the risks can also be considerable, given the chicken-and-egg situation between low-cost production of green hydrogen and large-scale consumption in decarbonised industries. Exports, however, are only part of the picture.

Many African countries are developing highly ambitious hydrogen economy strategies (figure map). The underlying assumption is that cheap hydrogen can be a game changer for their economies, and can ‘flip the script’ from energy poverty to green energy leadership. At the same time, initiatives like the Africa Green Hydrogen Alliance, between Egypt, Kenya, Mauritania, Morocco, Namibia and South Africa, and several national strategies have an implied sequencing between export markets and domestic hydrogen economies: Exports of hydrogen, ammonia, and other derivatives like e-fuels create “breakthrough opportunities” to develop the sector today, while unlocking domestic opportunities for decarbonised heavy industries tomorrow.

Realizing Africa’s demographic dividend: A call to action (Brookings)

Africa stands at a crossroads, facing both unprecedented opportunity and daunting challenges on the path to realizing its demographic dividend. With a youthful population that could potentially fuel a transformative wave of economic growth and development, the continent is poised for significant progress. However, several formidable hurdles stand in its way. Among these challenges, the role of medium, small, and micro enterprises (MSMEs) emerges as a critical factor, with limited access to finance and loans, stringent collateral requirements, and a lack of capacity-building opportunities posing significant barriers to the growth of these businesses. Furthermore, the broader issue of financial inclusion amplifies these challenges. In addressing these multifaceted problems, Africa must overcome these hurdles to harness the promise of its youthful population, ultimately turning demographic potential into lasting socioeconomic progress.

Digital finance boosting women’s financial inclusion in sub-Saharan Africa: Emerging evidence (Brookings)

In the 10 years leading up to 2021, the share of women in sub-Saharan Africa who owned a financial account more than doubled to reach 49%, according to data from the Global Findex. Since 2017 alone, account ownership rates for women in the region increased 12 percentage points, driven entirely by increased adoption of mobile money accounts.

Mobile money is a financial service offered by a telecom or a fintech firm that partners with mobile network operators independent of the traditional banking network (this is different from traditional banking services accessed through a mobile phone). Mobile money services are typically enhanced by local mobile agents, where women can conveniently deposit even small amounts of cash to make payments, pay bills, send remittances, or store money outside of the home.

Two striking examples include Cameroon, where account ownership for women increased from 30% in 2017 to 49% in 2021, including a 26 percentage point increase in mobile money accounts, and Ghana, where account ownership for women increased from 54% to over 63%, including a 21 percentage point increase in mobile money accounts.

The continued growth in financial access is excellent news, given evidence showing the ways women benefit from having their own financial accounts. These include greater personal safety and less exposure to theft, more say over how household resources are spent, and greater ability to receive money from friends and family in the event of an emergency.

SADC aviation leaders call for open skies to promote economic growth in the region (IOL)

According to Natalia Rosa, the project lead on SADC Business Council Tourism Alliance, the current state of aviation in SADC is a massive own goal for the region’s economies and the region can talk about a free trade area and regional integration, however, if people and goods can’ t move efficiently then it’s all just empty promises. Rosa was speaking at the Southern African Industrialisation Forum (SAIF) held in Sandton recently.

Why Internet disruptions have rocked parts of Africa (The East African)

Damages on multiple undersea telecommunication cables are the cause of a far-reaching connection outage that rocked parts of the African continent for the second day on Friday, with operators and Internet watch groups warning that the situation could take weeks if not months to fix. As of the close of Friday, at least eight countries in the continent had reported major connectivity issues even as details regarding the cause of the sub-sea cable damages remained scanty.

According to reports by global media networks, the cable lines affected included the West Africa Cable System (WACS), MainOne, South Atlantic 3 and ACE sea cables—all of which are regarded as key continental arteries for telecommunications data.

Among countries that took the biggest hit included Côte d’Ivoire, Liberia and Benin while Ghana, Nigeria, Cameroon and South Africa reported mild disruptions. Others affected included Burkina Faso, Gambia, Guinea, and Niger.

Internet blackout an attack on Africa’s trade, democracy – Agumenu (Ghana News Agency)

Dr Donald Agumenu, a leadership and management expert, has described the internet blackout experienced in parts of the African continent as “suspicious threat to its trade and democracy”. He said it was unfortunate that major trading blocs in Africa were hit by the cyber storm, disrupting trading activities.

Dr Agumenu said it was also worrying that it occurred when some of those countries were seriously preparing for elections. He said the excuse for an undersea cable disruption should not be taken lightly, saying, there were more to it from a geo-cyberpolitical perspective that needed to be explored to its logical conclusion.

“Africa may experience a more complex internet and cyber warfare if the techno-revolutionary narrative remains the same. What is more worrying is the level of vulnerability it brings to a continent with over half a billion people online.” “We need to wake up to the fact that the era of ICT and digital transformation has ushered in a new community with its own complexities and that we need to manage this paradigm shift with the utmost care to stay afloat in global affairs,” he cautioned.

EAC partner states ignite federation quest (IPP Media)

President Samia Suluhu Hassan at midweek hosted Kenyan President William Ruto and Ugandan counterpart Yoweri Museveni in a meeting aimed to discuss East African economic and political integration. The meeting held on Thursday evening at the Tunguu State Lodge in Zanzibar, saw the three leaders agreeing on the need to hasten public hearings on the structure and areas to be considered in a draft constitution for East African political federation.

This exercise has already been conducted in Burundi, Uganda and Kenya, it said, with the president saying in the X post that “apart from other things, we have also discussed measures to take to ensure that citizens in the EAC benefit from available economic opportunities.” The leaders also discussed the importance of heightening security and safety as a major pillar helping the various countries attain development goals.

President Museveni similarly affirmed that the discussion was centred on the significance of the East African Community (EAC) attaining political federation, “which would most certainly guarantee the prosperity of our people.”

On the other hand, President Ruto said that the discussion was focused on the fast tracking of the federation. “Today, as leaders among the eight EAC partner states, we reaffirm our unwavering support for further regional integration and prosperity, focusing on fast-tracking the federation,” the Kenyan leader wrote on X.

Red Sea, Suez Canal crisis fuels fresh wave of rate hikes in East Africa (The East African)

East African central banks are facing a fresh wave of rate hikes to contain inflationary pressures emanating from surging shipping and insurance costs for vessels diverting from the Suez Canal as a result of the Middle East conflict which continues to disrupt the flow of goods through the Red Sea.

The Bank of Uganda (BoU) recently convened a Monetary Policy Committee (MPC) meeting that increased its policy rate by 50 basis points to 10 percent to deal with the new inflation threats. This signals likely rate hikes in Kenya and Tanzania, whose 15 percent and 10 percent, respectively, of foreign trade goes through the Egyptian waterway, according to data by the United Nations Conference on Trade and Development (Unctad).

“Risks to the inflation outlook remain highly dependent on the global and domestic environment. Specifically, higher global commodity prices, partly due to geopolitical tensions and an increase in shipping costs resulting from the Middle East conflict as well as tighter global financial market conditions could result in higher domestic inflation,” BoU’s deputy governor Michael Atingi-Ego said in a statement dated March 6.

US-East Africa trade summit set for April (CAJ News Africa)

The fourth edition of the regional American Chamber of Commerce Kenya (AmCham) Business Summit will advocate for enhanced partnership and investment in the United States-East Africa trade. AmCham is the premier platform for strengthening bilateral trade and investment between the US, Kenya, and East Africa. The upcoming edition is set to be held on April 24–25, in Nairobi, Kenya.

AmCham’s Board President, Peter Ngahu highlighted that the summit would explore opportunities to promote sustainable and inclusive growth while increasing investment in Kenya and the East African region. “As we celebrate years of shared value and interests, the AmCham Business Summit stands as a beacon of opportunity. We look forward to exploring how we can leverage these opportunities as we stay committed to helping drive investments in East Africa,” Ngahu said.

A wide range of topics critical to the region’s economic development, including shaping the future of US-East Africa trade and investment, climate action, digital transformation, and sustainable finance for East African economies, will be covered in a series of panel discussions, keynotes, and roundtables moderated by experts from the public and private sectors.

Co-convenors mark March round of e-commerce negotiations an important milestone (WTO)

During the second round of e-commerce negotiations in 2024, held from 11 to 14 March, e-commerce negotiators reviewed a second iteration of the Chair’s text that had been circulated shortly before the WTO’s 13th Ministerial Conference. Co-convenors of the talks — Australia, Japan and Singapore — said that this version is comprehensive and could pave the way for the conclusion of the agreement by the summer.

Progress Report: Sustainability, Digitalization and Safety in Air Cargo (IATA)

The International Air Transport Association (IATA) reviewed progress in digitalization, safety and sustainability at the opening of the IATA World Cargo Symposium with the aim of accelerating progress on these critical priorities. “Air cargo volumes are now firmly back to pre-pandemic levels. The challenge now is to ensure that air cargo growth is efficient, safe and aligned with achieving net zero carbon emissions by 2050. Through the hard work of the air cargo industry, the building blocks are in place to significantly accelerate progress in all these areas,” said Brendan Sullivan, IATA’s Global Head of Cargo at the World Cargo Symposium (WCS), which opened in Hong Kong, on 12 March.

UNCTAD urges reforms on global debt architecture amid rising distress (UNCTAD)

UNCTAD has called for urgent reforms to the global debt architecture to avert a widespread debt crisis among developing countries. In the wake of the COVID-19 pandemic, developing countries’ external sovereign debt – funds borrowed in foreign currency – increased by 15.7% to $11.4 trillion by the end of 2022. The mounting debt levels are further complicated by the diversity of lenders and financial instruments.

Equally alarming is the surge in debt servicing costs. Low-income and lower-middle-income countries – also referred to as frontier markets – that borrowed when interest rates were low and investors keen are now spending around 23% and 13% of their export revenues, respectively, to repay their external debt.

The rising debt costs are draining vital public resources needed for development. About 3.3 billion people – almost half of humanity – now live in countries that spend more money paying interest on their debts than on education or health. The UN’s “A World of Debt Dashboard” provides data and in-depth insight on key public debt and development spending indicators for 188 countries.

“This situation is clearly unsustainable,” Ms. Nesvetailova says. “While a systemic debt crisis, in which a growing number of developing countries move from distress to default, looms on the horizon, a development crisis is already underway.”

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Quick links

Trade Policy Review: Angola (WTO)

Brazil reaffirms bond with Africa (The Independent Uganda)

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Russia formally accepts Agreement on Fisheries Subsidies (WTO)