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Building capacity to help Africa trade better

tralac Daily News

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tralac Daily News

tralac Daily News

Freight Rate Frustrations (Investec)

It’s no secret that carriers are not able to meet their scheduled transit times. Anchorage delays outside South African ports have improved over the past few weeks, but unfortunately this is due to port omissions and a reduction in inbound capacity, and not because of improved performance by Transnet.

Equipment breakdowns remain a major issue for the ports and therefore negatively impact port operation. Vessel berthing delays remain on average between 10 to 16 days in Durban and between five to eight days at Coega and Cape Town ports.

Carriers will continue to omit port calls or re-route vessels at short notice should they foresee severe delays to their schedules. A majority of vessel sailings are running behind schedule into and from South Africa. Additional lead time still needs to be factored in until further notice.

Summit emphasises imperativeness of supporting SMMEs (Engineering News)

Small, medium-sized and microenterprises (SMMEs) in the country are grappling with various challenges, including a lack of coordination between the public and private sectors, financial support, addressing the skills gap and empowerment through funding and government support.

Despite this, SMMEs have often managed to remain resilient in the face of these challenges. Moreover, there are measures that can be undertaken to mitigate the challenges, such as mentorship of entrepreneurs, implementing the correct culture and proper leadership to address organisational issues.

For their part, entrepreneurs should focus on bolstering their emotional intelligence, self-awareness, and social skills, as well as networking and building relationships with the requisite stakeholders to further their goals and businesses, speakers outlined during the Absa – South African Chamber of Commerce and Industry (Sacci) National SMME Summit, held in Sandton, on May 21.

Building strong supply chain for competitive Kenyan perishable trade (Africa Aviation News)

Kenyan flower and perishable trade is at a crossroads. While it dominates the foreign markets and is preparing to fly high, global competition is rising, logistics infrastructure is inadequate, freight rates are rising, and geopolitical implications are not helping. However, there are opportunities for a sustainable, digitalised future.

“Kenya’s floriculture contributes 1 percent of the national GDP, however, with global competition intensifying, especially from Latin America, Kenya’s floriculture faces multifaceted challenges.” These are the words of Lina Jamwa, membership, advocacy and communications manager, Kenya Flower Council, who emphasised the flower industry’s significant role and raised concerns about its logistics challenges. She was speaking at the two-day conference Flower Logistics Africa (FLA) and Perishable Logistics Africa (PLA) 2024 organised by Logistics Update Africa in Nairobi, Kenya on 27 and 28 March 2024.

Jamwa highlighted the Red Sea crisis as a pressing logistical challenge, increasing transit times and freight costs. The situation forced Kenyan exporters to seek alternative routes like the Cape of Good Hope, significantly impacting logistical expenses and supply chain dynamics. “Because of the Red Sea crisis, we are now using the Cape of Good Hope, making our logistical expenses high,” noted Jamwa.

Kenya says it created 139 000 digital jobs in a year (ITWeb Africa)

Over the last year, Kenya says it has created over 139 000 digital jobs for youth as part of an unemployment-reduction programme. The government claims it accomplished this by establishing digital hubs across the country during that time. Since the program’s inception, East Africa’s largest economy claims to have trained thousands of young people in collaboration with its partners.

Eliud Owalo, cabinet secretary for information, communications, and the digital economy, revealed the data yesterday during the unveiling of another digital hub in Nairobi. “This is a game changer. It is transformational,” he said of the government’s digital jobs initiative. “As of today, formal occupations are limited, if not non-existent. Where we have jobs is in the digital sector, so we are collaborating with our honourable Members of Parliament to establish digital hubs in each and every ward in this country,” Owal stated.

Finance Bill 2024 Proposals (The Exchange Africa)

The Kenya Association of Manufacturers (KAM) has raised concerns over the state’s proposal to increase the Import Declaration Fund (IDF) from 2.5 per cent to 3 per cent. In a raft of proposals to the government, the manufacturers highlighted some of the expected impacts of the proposed law on Businesses in the East African nation. KAM argues that the imposition of IDF will significantly elevate the costs of raw materials, thereby stifling the manufacturing sector’s ability to add value.

In a statement on Monday, May 20, 2024, the manufacturers said whereas there are some progressive proposals in the proposed law aimed at promoting manufacturing growth, several others shall hinder this objective, and ultimately impact Kenyans. “The proposal to increase the Import Declaration Fund from 2.5 percent to 3.0 percent will negatively impact the cost of raw materials and intermediate products used for manufacturing value addition,” said KAM CEO Anthony Mwangi.

They say the proposal to impose the Export Investment Promotion Levy (EIPL), under the Miscellaneous Fees and Levies Act, on raw materials used for manufacturing value addition shall be detrimental to the competitiveness of local industries in both local and export markets through the increased cost of production.

Bilateral ties bring benefits as official reaffirms stance on Taiwan question (China Daily)

China-Kenya cooperation has yielded fruitful results over the past decades and Kenya is looking to carry forward bilateral relations as well as supporting the one-China principle for mutual benefit, said a senior Kenyan official. In an interview on Monday in the Kenyan capital Nairobi, Moses Wetang’ula, speaker of the National Assembly of Kenya, said bilateral relations have grown phenomenally since the start of the century, which has boosted growth in Kenya and brought benefits to the people.

“When you look today, China is a signature to almost every major infrastructure project in Kenya, and the people of Kenya appreciate this,” he said. “The relationship between Kenya and China is excellent.

Kenya President Ruto’s regional message in bilateral visit to US (The East African)

Kenya’s President William Ruto on Monday landed in the US in his first-ever State visit to Washington and used this opportunity to deliver a regional message for a bilateral trip. In his first engagement since landing, President Ruto spoke about climate change, financial restructuring and dealing with regional security problems. However, he said the allure of democracy may wane if enthusiasts of freedom of choice continue to wallow in poverty, especially in Africa.

President Ruto was speaking on “Global Democracy Partnership”, an engagement at the Carter Center in Atlanta, named after former US president Jimmy Carter. Ruto had been expected to speak about the growth of democracy in Kenya over the years. But he also used the occasion to speak about the challenges facing the continent.

“Many countries are in economic and debt distress occasioned by climate change and compounded by an unjust international financial architecture and an imperfect multilateralism associated with the free market economy. We now run the escalating risk of democracy and free market being associated with poverty and suffering, lending credence to the widespread lamentation that democracy is or has been on the retreat in many parts of the world, including Africa,” he added.

Digital Transformation: NITDA Extends Digital Technologies To Grassroots (Science Nigeria)

The National Information Technology Development Agency (NITDA) said it is poised to partner with relevant organisations to effectively disseminate the advantages of digital technology to all 774 local governments across the nation. This information was revealed by the director-general of NITDA, Mallam Kashifu Abdullahi during a meeting with the senior special advisers to the president on community engagement (Barr. Chioma Nweze for Southeast, Ms. Moremi Ojudu for Southwest and Hon. Abdallah Yakassai for Northwest), who visited the agency to explore potential areas of collaboration in Nigeria’s digital transformation journey.

Emphasising the agency’s vision for a Nigeria where inclusive economic growth is nurtured through technological innovation, the NITDA DG highlighted that this vision corresponds with the president’s eight priority areas.

“The President aims to reform the economy for sustained economic growth; enhance national security for peace and prosperity; bolster agriculture for food security; improve infrastructure and transportation as growth facilitators; prioritise education, health and social investment for development; expedite diversification through digitisation, industrialisation, creative arts, and innovation; and enhance governance for efficient service delivery to citizens,” he remarked.

Use resources to diversify African economies, unlock sustainable growth (Engineering News)

A majority of African economies, or 83%, are highly commodity-dependent and are vulnerable to external shocks, experiencing good growth when commodity prices are high, but seeing growth reversal and setbacks when prices are low.

Chad, for example, experienced an average of 9% growth in GDP between 2001 and 2014, but since 2015, the GDP of the country has contracted and poverty increased. GDP per capita is decreasing and developmental gains have been reversed because of the inability to sustain economic growth.

The shift from agriculture to oil made the economy less diversified and vulnerable to external shocks, independent policy research initiative African Futures Innovation Programme senior researcher Dr Kouassi Yeboua said during the African Centre for Economic Transformation Summit on Economic Transformation on May 20.

However, Africa should leverage its resources to increase the investment capacity in economies and the resources available for long-term investment. Rather than finance current consumption, resources must be aimed at financing economic transformation going forward, University of Pretoria Department of Economics head Professor Nicola Viegi suggested.

Towards the establishment of a framework for sharing best practices for the implementation of the AfCFTA in West and North Africa (UNECA)

The Sub-Regional Office for West Africa of the United Nations Economic Commission for Africa (SRO-WA/ECA), in collaboration with the Enhanced Integrated Framework - World Trade Organization (EIF-WTO) and the International Islamic Trade Finance Corporation of the Islamic Development Bank group (ITFC-IDB), is organizing from June 4 to 5, in Lomé, Togo, a mutual capitalization workshop on regional experiences in the implementation of the African Continental Free Trade Area (AfCFTA) in West and North Africa.

This meeting will be held in a context where, according to the estimates of the ECA, the effective implementation of the AfCFTA would generate an increase in intra-African trade by 33.8% by 2045, including an increase of 41.1% in trade in the agri-food sector, 39.0% for industry, 16.1% for the mining sector, and 39.2% for services.

According to the ECA, trade gains in the ECOWAS sub-region would be 32% higher than in Africa as a whole, with an increase of 29% for the agri-food sector, 24% for industry, 10.6% for mining, and 39.3% for services.

COMESA to accelerate regional horticulture sector growth (The Exchange Africa)

Agriculture is the backbone of nearly all East Africa region’s economies and the main economic activity for more than 70 per cent of the population. It is estimated to contribute on average 27 per cent of the gross domestic product (GDP) in the EAC and accounts for the highest share of employment not only in the region, but the African. However, the region makes huge post-harvest losses in food products annually in the range of 30 per cent in cereals, 50 per cent in roots and tubers, and up to 70 per cent in fruits and vegetables, according to data by the East African Community.

To help countries curb these losses, the Common Market for Eastern and Southern Africa (COMESA) has unveiled the programme targeting five countries in the region, with a focus in the horticulture sub-sector. The COMESA – East African Community Horticulture Accelerator (CEHA) project targets avocado, onion and Irish potato farming in Kenya, Rwanda, Tanzania, Uganda and Ethiopia, with a keen focus on ensuring continued growth of the sector through increased exports, income employment and food security.

Under the programme, farmers in the five countries are expected to access quality seeds, training on how to improve production and distribution, countries to establish standards and traceability, and strengthen post-harvest management while improving gains in the value chain. The five-year programme is expected to help the countries cut post-harvest losses in horticulture to 40 per cent or lower, from highs of 60 per cent, for instance in Kenya.

SADC launches US$5.5 billion Regional Humanitarian Appeal to support people affected by the El Niño induced Drought and Floods (SADC)

The Chairperson of the Southern African Development Community (SADC), His Excellency João Manuel Gonçalves Lourenço, President of the Republic of Angola on 20 May 2024 launched the SADC Regional Humanitarian Appeal of at least US$5.5 billion to support over 61 million people affected by the El Niño induced Drought and Floods.

The Humanitarian Appeal, which was launched during the Extraordinary Virtual Summit of Heads of State and Government, is aimed at augmenting domestic resources of the affected Member States, including efforts for resource mobilisation from national, regional, and international partners in response to the impact of El Niño induced drought and floods.

ECOWAS Parliament to setup mediation committee on Niger, Mali, Burkina Faso (Daily Post Nigeria)

The Parliament of the Economic Community of West African States, ECOWAS, is to constitute an ad-hoc Mediation Committee to work with all stakeholders towards getting Niger, Mali and Burkina Faso to return to the sub-regional body. The First Deputy Speaker of the ECOWAS Parliament and Deputy Senate President, Jibrin Barau, made the disclosure at the opening of the 2024 2nd Extraordinary Session in Kano on Tuesday. He said the decision was in line with the clarion call made by the President of the ECOWAS Commission for Parliament’s urgent intervention in addressing pressing issues in the community.

“The President noted the urgency of joining ongoing efforts aimed at avoiding the disintegration of the regional bloc, which could happen with the departure of Mali, Niger and Burkina Faso.

‘Multilateral Collaboration Key To Digital Infrastructure Growth’ (DailyGuide Network)

Chief Executive of Telecel Ghana, Ing. Patricia Obo-Nai, has called for stronger multilateral partnerships and cooperation between industry, government, and investors to accelerate the growth of digital public infrastructure in Africa. Delivering the keynote remarks on ‘Digital Infrastructure and Innovation: Accelerating Africa’s Development’ at the Mobile Technology for Development (MT4D) session of the 3i Africa Summit, Ing. Obo-Nai outlined a roadmap for leveraging technology to fast-track digital infrastructure, innovation and literacy across the continent.

“My first call on the topic is for cooperation and partnership between governments, industry, domestic direct investors and foreign direct investors to work together on increasing digital public infrastructure if we are serious about it. Let’s not just discuss, let’s implement,” Obo-Nai said.

Ing. Obo-Nai highlighted three key areas that require attention to expedite the integration of technology into public service to benefit every community – infrastructure, innovation, and digital literacy.

African Development Bank’s Adesina highlights Africa as the world’s best investment destination at BADEA’s 50th anniversary (AfDB)

Africa’s human, land, mineral resource and cross-border trade endowments combine to make it the world’s most promising investment destination, now and well into the future, African Development Bank Group President Dr Akinwumi Adesina said.

Speaking yesterday at the 50th anniversary celebration of the Arab Bank for Economic Development in Africa (BADEA) in Riyadh, Adesina outlined five reasons why Africa is the world’s investment frontier: The size and youthfulness of the population, the continent’s renewable energy potential, abundant arable land, and the African Continental Free Trade Area (AfCFTA), which he noted is “the single largest free-trade zone in the world in terms of number of countries.”

Adesina further highlighted the resilience of African economies, “despite the challenges posed by climate change, geopolitical tensions, global inflation and rising debt, among others.”

State and Trends of Carbon Pricing 2024 (World Bank)

There are now 75 carbon pricing instruments in operation worldwide. Over half of the collected revenue was used to fund climate and nature-related programs.

“Carbon pricing can be one of the most powerful tools to help countries reduce emissions. That’s why it is good to see these instruments expand to new sectors, become more adaptable and complement other measures,” said Axel van Trotsenburg, World Bank Senior Managing Director. “This report can help expand the knowledge base for policymakers to understand what is working and why both coverage and pricing need to go up for emissions to go down.”

Report findings show large middle-income countries including Brazil, India, Chile, Colombia, and Türkiye are making strides in carbon pricing implementation. While traditional sectors like power and industry continue to dominate, carbon pricing is increasingly being considered in new sectors such as aviation, shipping and waste. The EU’s Carbon Border Adjustment Mechanism, currently in a transitional phase, is also encouraging governments to consider carbon pricing for sectors such iron and steel, aluminum, cement, fertilizers, and electricity.

Tehran, Moscow working to create single currency for BRICS: Iran envoy (Fibre2Fashion)

Iran and Russia are working to create a single currency for the BRICS grouping, with the former actively participating in the activities organised under latter’s chairmanship of BRICS, Iranian ambassador to Russia Kazem Jalali said recently.

“The creation of a new single currency within the framework of the association is what Russia and Iran are working on,” the diplomat told a press conference at the 15th International Economic Forum ‘Russia-Islamic World: KazanForum’ organised in Kazan in southwest Russia recently. Iranian ambassador to Russia Kazem Jalali said that as the United States uses the dollar to ‘create restrictions’, the use of national currencies in mutual settlements is on the agenda.

See also: Sri Lanka Joins List Of Countries Eyeing BRICS Membership This Year (Outlook India)

Trade and Gender Informal Working Group advances work on gender-responsive trade policies (WTO)

The Informal Working Group (IWG) on Trade and Gender met on 17 May to advance discussions on gender-responsive trade policies in line with the 13th Ministerial Conference (MC13) Declaration, which recognized the importance of promoting women’s participation in trade. Members participating in the Group provided updates on their trade and gender initiatives and discussed ways of improving women’s participation in international trade.

Some of the proposals related to the Compendium of Financial Inclusion Initiatives for Female Entrepreneurs, launched at MC13, which aims to help policymakers design gender-responsive trade policies to enhance women entrepreneurs’ financial inclusion. The co-chairs also encouraged members of the IWG to share proposals on developing gender-disaggregated data and statistics, as agreed at the last meeting on 6 March 2024.

Empowering change: Women transforming the world of trade, treasury & payments (Trade Finance Global)

While it is true that the trade, treasury & payments industries have made impressive strides in gender inclusion, moments like these show that we have a long way to go.

Trade finance has traditionally been a male-dominated field, in fact, according to the WEF Global Gender Gap report, it will take 131 years to reach full gender parity. But this narrative is changing, slowly but surely. Women are now leading key initiatives, driving innovation, and bringing diverse perspectives to the table. Their participation is crucial for fostering an inclusive environment that promotes sustainable growth and equitable opportunities.

The digital revolution is a powerful catalyst for gender inclusion in trade. Digital platforms and technologies offer unprecedented opportunities for women to access global markets, secure financing, and enhance their business operations. Initiatives like the Africa Trade Gateway (ATG) by Afreximbank provide women entrepreneurs with access to critical trade information, helping them make informed decisions and expand their businesses.

INTERVIEW: Developing countries risk missing out on net-zero benefits, but fairer future is possible (UN News)

The lead author of the World Economic Situations and Prospects mid-year update, the flagship report from DESA released on 16 May, outlined the main findings in an interview with UN News.

When the war in Ukraine started, we saw a huge spike in commodity prices. Oil prices shot up. Grain prices shot up. But, they have normalised. Similarly, when the Gaza war began last October, we saw some increases in oil prices and some commodity prices but, again, they stabilised. The global market is responding to this crisis more efficiently, and alternative sources are emerging, so we haven’t seen a severe effect on prices from the Gaza war. However, we are seeing other effects; freight prices have gone up because the Red Sea route is restricted. In 2022 in the early months of the Ukraine war, shipping was disrupted, causing a huge spike in grain and other commodity prices.

And when you’re diverted around the Cape of Good Hope, you’re adding another 15 days of travel time, which really adds up a lot of costs. In general, the biggest headwind right now is geopolitical risk, which is why we have adjusted downward the growth forecast for the majority of the countries in Africa.

Can Cybersecurity Be a Unifying Factor in Digital Trade Negotiations? (Dark Reading)

Over the past decade, the digital trade policy community has been consumed by battles over data privacy, cross-border data flows, and e-customs duties, on which forging an international consensus remains elusive. Yet among the geopolitical jostling on these issues, there is at least one critical area where we see steady, tangible progress in digital trade policy: cybersecurity.

In today’s global economy, the increasingly fragmented state of global cyber regulation undermines cybersecurity and the growth potential of digital trade. Trade negotiators should leverage the opportunity to secure more ambitious cybersecurity commitments, advancing a fair, inclusive, sustainable, and secure digital trade environment, even as negotiations on more contentious digital issues remain stalled.


Quick links

High-end cellphone makers cut out accessories to curb e-waste menace (The East African)

Member States call for transformative policies and quality funding, crucial for the UN’s boost for people and planet (UN Sustainable Development Group)

A Closer Look at the Global South (Carnegie Endowment for International Peace)

A Tale of Two Worlds (UNDP)

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