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tralac’s Daily News Selection
The selection: Wednesday, 30 March 2016
Featured alerts, commentary:
South Africa’s February 2016 trade data will be released tomorrow. Bloomberg consensus sees a compression of the deficit to -R4.3bn.
The Commonwealth Trade Expert Group is meeting in Delhi, discussing 'Revitalising global trade and multilateralism'
Joshua P Meltzer: 'New trade deals challenge Africa to step on to the global stage' (The Guardian)
Rwanda: Trade deficit grows in first two months of 2016 (New Times)
According to a statement from the central bank yesterday, the country’s trade deficit widened to $297.2m (about Rwf232.4bn) largely due to an increase in formal imports that rose by about 7.2%, as well as a 9.7% decrease in the value of Rwanda’s exports. The international trade developments were among the focus of discussions during yesterday’s quarterly financial stability committee and monetary policy committee meetings chaired by the National Bank of Rwanda governor, John Rwangombwa.
South Africa: Poultry crowd rubs salt in own wounds (Business Day)
The South African Poultry Association is trying to get the South African International Trade Administration Commission to institute an agricultural safeguard on EU chicken. An agricultural safeguard is not dissimilar in effect to the antidumping duty that is no longer imposed on US bone-in chicken, except that it operates in three-year cycles. The association is essentially looking to institute protectionist action in the form of a 37% import tariff on EU bone-in chicken. [The author, David Wolpert, is CEO of the Association of Meat Importers and Exporters SA] [Call for steps against duty-free European chicken] [AGOA sword will keep hanging above SA]
Kenya's tea sector: value chain capacity assessment project launch (ACBF)
The assessment will undertake a comprehensive review of capacity assets, needs and options for strengthening capacity of key targeted institutions responsible in the value-chain of the tea product. The review will also identify structural and institutional factors including agents that can influence change resulting from a capacity development investment to improve the performance of the product. These factors will include the conduciveness of the socio-political environment, efficiency of prevailing policy instruments, effectiveness of organizational arrangements, as well as technical skills and knowledge. The assessment is expected to be finalized by the end of May 2016. [Further details: KIPPRA]
Recent papers published by the COMESA Monetary Institute:
Challenges of dollarization in COMESA: Governors noted the following recommendations from the study [extract] : i) Successful de-dollarization requires implementation of an appropriate mix of sound macroeconomic policies, market-based incentives, and micro-prudential measures including: ii) There is need for countries to avoid policies that may lead to stagflation and severe macroeconomic disruptions which precipitates the need for dollarization.
Enhancing the effectiveness of fiscal policy for domestic resource mobilization in the COMESA region: In the COMESA region, as elsewhere, fiscal policy can and should be used effectively to foster growth, reduce short term fluctuations of economic activity and maintain economies close to their potential growth paths. The necessity to carry out these tasks is emphasized by the following conclusions [extract]: i) Domestic revenue to GDP ratios remain low for most member countries (figure 2) attributed to among others low per capita income and growth, institutional problems and weak governance. Addressing these challenges provides a case for fiscal policy in domestic resource mobilization. [COMESA Committee of Governors of Central Banks: meeting report, 19 November 2015]
AfDB President rounds up Asian tour in Beijing with firm commitments for support (AfDB)
Most of the cooperation commitments discussed at the meetings will be concretized at the Bank’s 2016 Annual Meetings in Lusaka, Zambia. The Bank’s staff involved in Japan, Korea and China will be very activate in the coming days refreshing MOUs and writing the terms of new cooperation agreements, a member of the delegation said.
African Institute for Economic Development and Planning: progress report (UNECA)
Now that the strategic framework has been defined globally, time has come for an contextualized action in 2016, to translate these agenda into national, subregional and regional objectives. IDEP will therefore reorganize itself in order to adapt its offer to a changing environment and - as previously - pursue its support to member States in setting up training programmes in full compliance with the requirements of their transformative agenda.
Training of trade counsellors from IGAD livestock exporting countries to GCC countries (IGAD)
The IGAD Centre for Pastoral Areas and Livestock Development, in collaboration with FAO SFE, organized the training of trade counselors in Addis Ababa, 21-24 March. The activity was funded by an Italian-funded project. The limited exports has partly been due to limited coordination between the trade counsellors, exporters and chief veterinary officers. The gap has been in terms of real time market information and dissemination on import requirements as well as commodity prices and limited promotional and linkage efforts. The workshop made the following recommendations: [Zuma consolidates ties in the Gulf region (IOL)]
Nigeria: trade diplomacy, foreign policy perspectives (Daily Trust)
Q to Minister of Foreign Affairs, Geoffrey Onyeama: After one year, what should Nigerians expect from the ministry? 'We are faced with severe economic challenges. What can we, as a ministry, do? We decided on economic diplomacy as the framework in which we want to operate. We have identified two areas. First, we are looking at a strategy of targeting a number of African countries to have with them an agreement for the free movement of business people within Africa in order to enlarge the economic space for Nigerian businessmen. The second is to develop a matchmaking data base where Nigerian business persons can upload information about themselves, businesses and what they want to sell to the world and this would be accessible through our 119 foreign missions.'
Nigeria's promise turns to peril as investors head for the exits (Bloomberg)
Nigeria’s appeal has faded as the price of oil, source of 90% of export earnings, has crashed. Growth slumped to 2.8% last year, the slowest since 1999, and will decelerate to 2% in 2016, according to Morgan Stanley. In dollar terms, the economy in 2019 will still be 17% smaller than its 2014 peak of $542bn. Only two years ago, McKinsey & Co. said Nigeria had the potential to grow 7.1% annually until 2030 and build a $1.6trn economy. [Nigerian lawmakers want wireless giant MTN's fine doubled to eye-popping $10bn (M&G Africa)]
Total readies Shs13 trillion for oil pipeline development (Daily Monitor)
French oil major Total S.A has said it will finance the development of the $4b (Shs13 trillion) crude oil export pipeline from Uganda’s Albertine Graben to Tanzania’s Tanga port at the Indian Ocean. Mr Javier Rielo, the Total East Africa vice president, on Monday, assured Tanzanian President John Magufuli that “the company will begin construction of the pipeline project to transport oil from Uganda to Tanga as soon as possible, for funds to implement the project exist.”
Is the WTO a World Tax Organization? A primer for WTO rules for policy makers (IMF)
This paper examines the extent to which World Trade Organization rules impinge on policy makers’ freedom to formulate tax policies. It provides an overview of both the economic rationale for WTO rules concerning taxation and the provisions of the main WTO agreements concerning border taxes and internal taxes (direct as well as indirect). It also points out some tax anomalies and inconsistencies in these rules, and how the rules have evolved as a consequence of the interpretation of the WTO agreements by its Dispute Settlement Body and the latter’s rulings in connection with several disputes over taxes affecting trade. [The author: Michael Daly]
International regulatory co-operation: the role of international organisations (OECD)
In order to strengthen the information base on this topic and shed light on the contribution of IOs to IRC, the OECD carried out in 2015 a survey covering the governance, operational modalities and tools of IOs, as well as their rule-making disciplines and assessment of implementation and impacts. For most IOs, the main benefits provided by their IRC activities come from increased transparency of regulatory frameworks, knowledge flow and peer learning through exchange of information. Secondly, they promote efficiency gains and reduction of regulatory burdens through the sharing of tasks and increased coherence across regulatory requirements. The economic benefits, such as reducing regulatory burden or fostering economies of scale, come last.
Local nexus and jurisdictional thresholds in merger control (OECD)
Background paper by the Secretariat: Three years later, this paper seeks to provide a detailed overview of merger control thresholds and local nexus criteria in various countries, and to compare them with international recommendations on the topic. The paper is structured as follows: chapter 2 will provide some background on the topic of merger control thresholds and local nexus criteria; chapter 3 will describe the various types of notification thresholds and local nexus criteria adopted in different countries; chapter 4 will compare current practices to international guidelines, and identify the main developments since the Recommendation was adopted in 2005; and, finally, chapter 5 will summarise and analyse the main findings. [Annex to the Background Paper]
Related: Best practice roundtables on competition policy: June 2016, OECD, Public interest considerations in merger control: background paper
Over-The-Top (OTT) Services and regulation (tralac)
A close connection is developing between the rules of international trade on market access, domestic regulation and network neutrality. This is increasingly subject to trade negotiations. However, a comprehensive classification of the different facets of OTT services is yet to be developed. [The author: JB Cronje]
Going beyond goods: measuring services for export competiveness (World Bank)
Many governments are interested in how services support their country’s exports and economy at large. Answers to such questions are typically left unanswered because systematic data is not readily available on how services contribute to exports across developing countries and sectors. The Export of Value Added Database was developed to fulfill this need. What sets the EVA Database apart is the wide coverage of developing countries: over 70 of the economies included are low- and middle-income.
Egypt, World Bank sign $5m grant to ease regulatory environment for investors (World Bank)
Asian Development Outlook 2016 (ADB)
Growth is slowing across much of developing Asia as a result of the continued weak recovery in major industrial economies and softer growth prospects for the People’s Republic of China (PRC). This will combine to push growth in developing Asia for 2015 and 2016 below previous projections, says a new Asian Development Bank report. In its new Asian Development Outlook (ADO) 2016, ADB forecasts GDP growth of 5.7% in 2016 and 2017 for the region. In 2015, GDP growth was 5.9%. ADO is ADB’s flagship annual economic publication. [Downloads]
Related, regional perspectives: The benefits of regional electricity cooperation and trade: lessons from South Asia (World Bank), ADB, JICA establish $1.5bn fund to invest in private infrastructure (ADB), With RCEP commitment, India marks big shift in trade policy (Livemint), Roberto Azevêdo speech: 'Brazil in the global trading system: achievements and future challenges' (WTO), DG Azevêdo welcomes Brazil’s ratification of WTO trade facilitation deal (WTO)
Swaziland has to borrow $422.1m - official (StarAfrica)
Challenges for EAC to phase out 'Caguwa' by 2019 (New Times)
Mozambique/Swaziland: new bridge to boost trade (StarAfrica)
Tanzania: Ruvu gas find could be worth up to $11bn (IPPMedia)
East Africa: 'Chambers can issue Certificates of Origin' (editorial comment, East Africa Business Week)
Oil prices and the global economy: it’s complicated (IMF)
London Stock Exchange launches Africa Advisory Group to boost African capital market development
GREAT Insights: Partnerships with business for development (ECDPM)
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