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South African GDP declines by 0.7% (SAnews)
After two consecutive quarters of positive growth, the country’s real gross domestic product (GDP) dropped by 0.7%1 in the second quarter of 2022, Statistics South Africa (Stats SA) said on Tuesday. “The devastating floods in KwaZulu-Natal and load shedding contributed to the decline, weakening an already fragile national economy that had just recovered to pre-pandemic levels,” Stats SA explained. According to the national statistical service, manufacturing had the biggest drag on GDP due to flooding, which hurt several industries.
Impressive agriculture export earnings in Q2 2002 despite trade challenges (Farmers Review)
The latest trade data for the second quarter 2022 showed another stellar performance from the agriculture sector with a 5% quarter-on-quarter jump in export earnings to the tune of US$3.4 billion. An indeed impressive performance despite the earlier trade related challenges from the Foot-and-mouth Disease-induced halt in wool exports, to global logistical issues that curtailed citrus volumes. The stellar export earnings and subsequently an agriculture trade surplus was underpinned by robust export demand coupled with strong commodity prices. Maize seems to have made a structural break in export trends with volumes way above the historical levels.
The implication for producers is that higher earnings will help them navigate the current high-cost environment and further make the necessary production expansions and necessary replenishment of equipment and machinery.
South Africa’s New Energy Vehicle Roadmap to be production-led, Patel confirms (Engineering News)
Trade, Industry and Competition Minister Ebrahim Patel insists that South Africa’s New Energy Vehicle (NEV) Roadmap is taking shape amid warnings that, absent urgent government decisions on the future support framework, the domestic automotive manufacturing sector is at serious risk. He has also indicated that the NEV support framework would seek to use and build on the architecture in place under the second phase of the Automotive Production and Development Programme (APDP2) and would be production- rather than consumption-led.
In a presentation to the Presidential Climate Commission, Patel released details of what he described as a roadmap “working document”, which was premised on there being a “compelling” case for South Africa to make the strategic shift to NEVs. That conclusion was reached following a cost-benefit analysis, showing that it would be more advantageous to transition South Africa’s manufacturing focus away from internal combustion engines (ICEs) to NEVs than to seek to capture a larger slice of the remaining ICE markets as international vehicle manufacturers began upscaling their NEV strategies.
Patel also reported that government would opt for a production-led model, rather than the consumption-led strategy advocated by various industry stakeholders, whereby growth in domestic demand, supported by lower tariff barriers, triggered investment. “Our approach is led by a focus on the ‘at-risk export’ markets. “Let’s get production of EVs right, export to those markets where there is both the spending power and the regulatory incentives to encourage consumption. “And then off the back of bringing down the prices through what we have been able to achieve through export runs, sell an increasing quantity in the domestic market and, at an appropriate point, look at incentives that will get motorists to shift to EV consumption.”
DRC now third largest mover of cargo at Mombasa port (The Standard)
The Democratic Republic of Congo (DRC) is now the third largest market for the port of Mombasa with a reported market share of 8.2 per cent, Kenya Ports Authority (KPA) has said. To cement its position, Lignes Maritimes Congolaises - a DRC government-owned shipping line, began operations in June this year, becoming the latest entrant at Kenya’s biggest port. “With the formal admission of the DRC to the East African Community (EAC), more private and public organisations from the Central Africa country are setting up businesses in the country,” KPA noted in an update.
Uganda remains a key trade partner for Kenya with most of its exports and imports passing through Mombasa. Meanwhile, EAC Secretary General Peter Mathuki is set to lead a delegation of the heads of the regional bloc organs and institutions and eminent regional business leaders to the DRC from September 9. A statement from the regional bloc secretariat said the maiden mission to Kinshasa aims at enhancing awareness among DRC government officials on the existing EAC instruments, creating trade synergies and exploring and building business partnerships and immediate linkages for business associations.
China fish imports hit Sh2bn, controls 83pc of market (Business Daily)
The value of fish imported from China grew by 25 per cent to hit a historic high of Sh2 billion last year amid rising disquiet from local traders who have been edged out the market by the cheaper supplies. Data from the State Department of Fisheries seen by the Business Daily shows that Kenya shipped in 14.8 million kilogrammes of the delicacy from China last year, valued at Sh2 billion, up from Sh1.5 billion in the previous period. This has increased China’s market share from 70 per cent in 2020 to 83 per cent, as the Asian nation squeezed out South Korea, Thailand, Tanzania and Uganda from top source markets in the fight for the Kenyan consumer.
China, which is already Kenya’s biggest source of imports for household goods and electronics, is racing to bag a larger share of food exports into the continent including rice and manufactured edible products. In total Kenya imported fish worth Sh2.47 billion last year from the 19 sampled countries, a 10 per cent jump from Sh2.2 billion in 2020, to bridge the growing deficit due to dwindling stocks from major domestic sources such as Lake Victoria. Other source markets were Norway (Sh96 million), Tanzania (Sh92 million), India (Sh78 million) and Uganda (Sh57 million).
A look at new tax incentives to boost revenue collections (The New Times)
Vehicles transporting goods with gross weight exceeding five tonnes but not exceeding 20 tonnes will pay an import duty rate of 10 per cent instead of 25 per cent.
The government projects to spend an estimated Rwf4.6 trillion in the fiscal year 2022/2023, with expenditures expected to rise by Rwf217.8 billion. The government mobilises funds through different means including taxes, loans and grants. Another revenue stream is from non-tax collections such as visa charges, traffic fines and licenses. For this fiscal year, it opted to make some tax policy changes expected to boost revenue collections and support businesses. Incentives to some strategic sectors are expected to promote made in Rwanda products and to boost the economy.
Tighten tax on international trade – Government advised (Myjoyonline)
The Executive Secretary of the African Tax Administration Forum, Logan Wort, is pressing on African governments to tighten tax on international trade and increase investments in digital tax collection systems. According to him, this has become necessary due to the gradual shift in the use of technology over the years, which is partly attributed to the Covid-19 pandemic. Logan Wort spoke to Joy Business after addressing members of the forum at the ongoing annual congress which is seeking to come up with strategies to deal with the revenue shortfalls expected in the implementation of the continental free trade agreement.
“The digital economy in Ghana has exponentially increased over the last decade by about $3 billion annually, but what is the domestic tax take from there? So, you need to invest in the digitalisation of your tax administration, advance policies for taxing multinational enterprises, and bring more of the middle class into the tax net. This is what the conference will seek to do through well-researched documents from experts and analysts who hails from the continent”, he said.
Ghana to improve transparency in timber trade (GhanaToday)
The government has developed a Timber Legality Assurance System to improve transparency, efficiency and legality in the timber trade in European and domestic markets. The system is designed within the Forest Law Enforcement, Governance and Trade (FLEGT) framework which is being implemented by the Government of Ghana and the European Union.
Minister for Lands and Natural Resources, Mr Samuel Abu Jinapor announced that the ministry has also developed a Wood Tracking-Decision Support System (GWT-DSS), an electronic tracking system that tracks and traces timber from source to export. According to him, the GWT-DSS would ensure that any timber that enters the supply chain originates from legal sources.
African trade and integration
Revenue authorities, MoF need to work on revenue losses from AfCFTA (GhanaWeb)
The Commissioner-General of GRA, Rev Dr. Ammishaddai Owusu-Amoah, says Revenue authorities will need to work with Ministries of Finance to fill in the revenue losses expected from the lowering of import duties in the implementation of the AfCFTA.
The parties in the AfCFTA will have to reduce tariffs on “90% of goods that are traded within the continent” and this may result in short-term tariff revenue loss to most African member countries where trade taxes remain a key source of revenue. He said the execution of the AfCFTA would require technical skills, enhanced processes, and the use of technology by cooperating with competent authorities such as the Ministry of Trade, Customs authorities, tax authorities, and other law enforcement agencies involved in detecting various financial and customs-related crimes.
Dr Owusu Amoah was speaking at the opening of the three-day African Tax Administration Forum and African Tax Research Network 7th Annual Congress on the theme: Tax and Revenue Implication of the African Continental Free Trade Agreement.
How the African Continental Free Trade Area (AfCFTA) promises to improve labour mobility, spur wealth creation in Africa: By Margaret Soi, Head of Cross Border Banking, Standard Chartered Bank (African Business)
SADC Chair proposes an industrialization fund (sardc.net)
The SADC Chairperson, President Felix Tshisekedi has proposed a regional fund to support industrialization in SADC Member States and ensure the sustainability of its integration agenda.
Tshisekedi, who is President of the Democratic Republic of Congo (DRC) said this in his welcome message as host of the 42nd Summit of Heads of State and Government of the Southern African Development Community (SADC) held in August. In the official Summit publication that provides an annual review of progress, President Tshisekedi said the time has come for SADC to consider setting up a dedicated fund to support its industrialization agenda. “We encourage our organization to reflect on the need to set up an industrialization fund in order to finance industrialization projects and programmes and get out of dependence on external partners,” he said. “In this way, we will be able to achieve a major economic and technological transformation at national and regional levels towards the deepening of regional integration as advocated by the SADC Industrialization Strategy and Roadmap.”
He said the regional fund would complement resources from other partners including international cooperating partners and private investors, thus allowing the region to take full charge of its developmental trajectory and industrial path.
What hinders use of EAC’s simplified trade regime? (The New Times)
Misinterpretation and low understanding by Customs officials as well as cross-border traders, and corruption, are among major challenges hindering the full utilisation of the East African Community’s Simplified Trade Regime (STR), experts say.
Under the EAC Customs Union, the STR is a special provision aimed specifically at small traders who regularly transact in low value consignments. The legal basis of the STR is rule 14 of the EAC Rules of Origin; particularly paragraph four, which provides for use of a regularly updated and circulated Eligible List of Products (ELP) for ease and simplification of intra-EAC trade.
EAC Secretariat reaffirms commitment to infrastructure development to boost intra-regional trade (EAC)
The East African Community (EAC) Deputy Secretary General in charge of Planning and Infrastructure, Eng. Steven Mlote, has reaffirmed the commitment of the EAC Secretariat to infrastructure development aimed at boosting intra-regional trade and free movement of persons across the Community’s seven (7) Partner States. Eng. Mlote assured a visiting delegation from the Parliament of the United Republic of Tanzania (URT) Parliamentary Committee responsible for Foreign Affairs, Defence and Security of the EAC’s readiness to implement various infrastructure projects coordinated jointly by the Secretariat and Partner States.
The committee led by its Chairperson, Hon Vita Rashid Kawawa, was on a one-day working tour to the EAC Headquarters in Arusha over the weekend.
On his part, Hon. Kawawa the committee’s gratitude for information shared by the EAC Secretariat and requested that the entire URT Parliament should be informed about the ongoing programmes and projects aim to ease transportation in the region. “Infrastructure is a very important enabler in the EAC region in terms of helping to transport farm produce and different goods to the market,” said Kawawa.
Conference of Speakers of Parliaments concludes with a pledge to strengthen continental solidarity (African Union)
The high-level consultation between the Pan-African Parliament (PAP) and Speakers of Regional and National Parliaments has concluded with calls for strengthening links through continental solidarity and support for the implementation of the continent’s flagship development blueprint, the Agenda 2063.
The meeting took place in Midrand, South Africa on the sidelines of the Sitting of the PAP Committees under the African Union (AU) theme of the year 2022 as the year of Nutrition. The 11th conference of heads of African legislatures endorsed Agenda 2063 as a mechanism to an integrated and prosperous Africa driven by its own citizens. Hence the meeting called on the AU Member States to enact enabling legislation for effective implementation and realisation of the Aspirations of Agenda 2063.
In line with this vision, the PAP was encouraged to establish formal frameworks and communication channels to regularly transmit information on AU treaties requiring signatures and ratification. The African Continental Free Trade Area (AfCFTA) was recognised by the Speakers of Parliaments, as a vehicle for continental integration and economic development. In this regard, the African Parliamentary leadership called for ratification of the Protocol to the Treaty establishing the African Economic Community Relating to Free Movement of Persons, Right of Residence and Right of Establishment. The meeting further called upon the removal of Trade Tariffs and other barriers to facilitate and speed up the free movement of goods in order to boost African economies.
West Africa food insecurity demands climate-smart response amid multiple crises (France24)
As crises multiply and the devastating conflict in Ukraine drags on, its global effects are being felt hard in the Sahel and West Africa, a region with more than 38 million people facing acute food insecurity. The war’s impacts risk pushing an additional 7 to 10 million people in the region into food insecurity.
In the face of the crisis, the World Bank is deploying short- and long-term responses to boost food and nutrition security, reduce risks, and strengthen food systems. These actions form part of the institution’s global response to the ongoing food security crisis, with up to $30 billion in existing and new projects in areas spanning agriculture, nutrition, social protection, water, and irrigation. This financing will include efforts to encourage food and fertilizer production, enhance food systems, facilitate greater trade, and support vulnerable households and producers.
“Today, with soaring inflation, unfortunately many people in Africa are struggling to have access to basics such as food products,” says Ousmane Diagana, World Bank Vice President for Western and Central Africa.
Markets in the Sahel and across West and Central Africa are experiencing stark price rises of oil, rice, wheat and other commodities on the international market, and poorer households spend disproportionately more on food than those better off. The price of wheat, a food staple for many households, stood 60% higher at the start of June 2022 compared to January 2021, according to World Bank data. The price of fertilisers too, essential for productive agriculture, has surged since the war and now stands almost three times higher than a year ago. The knock-on effect is expected to reduce food production over the coming years as soaring prices force many farmers to use less fertiliser.
The World Bank is mobilising support for emergency responses in the Sahel and West Africa to help countries at risk of food insecurity respond faster. It is also working with its humanitarian partners to monitor regional food insecurity and draw up Food Security Preparedness Plans.
Africa must fast-track adoption of proven and sustainable solutions to survive food crisis (CNBCAfrica)
African countries now urgently need to fast-track the uptake of agricultural solutions with the greatest potential for immediate impact as well as lasting sustainability at the scale of millions of farmers. The wheat compact under the Technologies for African Agricultural Transformation (TAAT) initiative, supported by the African Development Bank and implemented by CGIAR, has already deployed more than 30 heat tolerant varieties benefitting 1.5 million people.
The African Development Bank and several UN agencies - the UN Regional Office for Central Africa, the Educational, Scientific and Cultural Organization (UNESCO) and the UN Office on Drugs and Crime (UNODC) - are joining forces to advance climate action in Central Africa. This region is highly strategic in the fight against climate change as it is home to the Congo Basin rainforest, the second largest tropical forest on the planet and the only remaining net carbon sink on earth.
These organizations expressed their willingness to strengthen their partnership during a meeting on 1 September in Libreville, on the sidelines of the 2022 African Climate Week. The Week was held from 29 August-2 September on the theme: “Roles of the Congo Basin Rainforest, biosphere reserves, and World Heritage Sites in climate change resilience and the implementation of the Sustainable Development Goals in Central Africa.”
Savina Ammassari, Resident Coordinator of the United Nations System in Gabon, said: “The challenges related to the lack of financial resources - which were discussed during this African Climate Week - must be resolved to strengthen actions related to adaptation and mitigation of the effects of climate change.”
European bank to greatly increase its funding for climate change adaptation in Africa (Engineering News)
Africa: Rich nations pledge funds at climate crisis summit (DW)
Wealthy nations said they would spend about $25 billion (€25 billion) by 2025 to boost Africa’s efforts to adapt to climate change, according to officials at a climate summit in Rotterdam, Netherlands, held Monday. The summit was the first ever to bring together leaders from across many governments and institutions, like the World Trade Organization and the International Monetary Fund, to discuss climate adaption techniques for Africa. The amount pledged was billed as the largest ever climate adaptation effort globally.
The African Adaptation Summit takes place just weeks after the Organization for Economic Cooperation and Development (OECD) found that rich countries had failed to deliver on their 2009 promise to spend $100 billion a year by 2020 to help developing countries adapt to global warming.
The OECD said richer nations gave $83.3 billion to poorer nations in 2020, the highest ever sum, but still short of the original amount.
Africa will need between $1.3 and $1.6 trillion this decade to implement itss commitments to Paris climate agreement, an annual cost between $140 and $300 billion, Adesina said.
Enabling Digital and Data Services for Expanded Economic in Africa (IPPmedia)
The white paper is part of the broader collaboration between AUDA-NEPAD and the Vodacom Group on strengthening the digital capabilities of AU Member States for enhanced public service delivery. The paper has come at an opportune time when the continent, recovering from the effects of COVID-19 and other global shocks, is putting in increased efforts to accelerate the implementation of digitalization strategies and policies. The paper provides in-depth analysis of the importance of appropriate free data flows within the context of the Fourth Industrial Revolution (4IR) and beneficiation from digital economies.
More importantly, the paper draws on lessons from other jurisdictions to provide elaborate policy recommendations and guidelines on how SADC Member States and other AU Member States can leverage on the principles of Africa’s regional economic integration frameworks to reduce regulatory barriers in order to create regional digital markets for the operationalization of the African Continental Free Trade Area (AfCFTA).
Energy Chamber Strongly Endorses the Central Africa Business Energy Forum (ZAWYA)
In 2022, it is imperative for Africa to prioritize regional cooperation and collaboration if the continent is to realize its goal of making energy poverty history by 2030. For both producing and non-producing nations, tackling the energy crisis together will not only ensure everyone on the continent has access to electricity but that a new era of socioeconomic growth is ushered in, an era that brings new levels of job creation, industrialization and energy security.
In pursuit of regional cooperation, the African Energy Chamber (AEC) is proud to officially endorse the upcoming Central Africa Business Energy Forum (CABEF), which takes place from September 8 – 9, 2022, in Doula, Cameroon. Under the theme, “Building Oil and Gas Infrastructure to End Energy Poverty in Central Africa by 2030”, this year’s edition of CABEF will unite the Central African sub-region’s energy players and policymakers to discuss the challenges and opportunities within the region’s burgeoning hydrocarbon sector.
Comprising massive oil and gas resources, Central African Economic and Monetary Community (CEMAC) countries have exceptional energy production potential. However, due to aging infrastructure and the low level of investment across the entire oil and gas value chains, energy access rates in the region have remained low and economic growth restricted. In 2022, as CEMAC countries aim to reverse this trend, forums such as CEBAF 2022 will be key, as it represents the best platform where discussions will be held on how to boost investment for optimal oil and gas exploration and production and make energy poverty history once and for all.
IICA to strengthen ties with Africa on innovation, trade and food security in Rwanda (News Ghana)
The Inter-American Institute for Cooperation on Agriculture (IICA) will take a new step in its newly developed work agenda with Africa, during the visit to Rwanda this week by its Director General, Manuel Otero, who will participate in the AGRF Summit, the main African forum to advance the food and agriculture agenda of this continent, which will hold its 12th Annual Summit under the theme “Grow, Nourish, Reward – Bold Actions for Resilient Food Systems”.
In Kigali, the Rwandan capital, Otero will participate, among other activities, in a plenary meeting with ministers and secretaries of Agriculture of Africa together with Indar Weir, the Minister of Agriculture and Food Security of Barbados, and will give a presentation at the discussion panel “South-South Cooperation: Leadership from the Americas and Asia”. He will share this panel with Agnes Kalibata, president of AGRA, the Alliance for a Green Revolution in Africa.
“We are making progress towards deepening the IICA-AGRA relationship and for this reason we are strengthening South-South Cooperation initiatives given the relevance of the African continent and the many opportunities it offers for the agriculture sector in the Americas. At the table that Otero will share with Kalibata in Rwanda, experiences, lessons and ambitions will be presented with a view to promoting development, for which cooperation is paramount”, said Jorge Werthein, Special Advisor to the Director General of IICA.
IICA, together with AGRA -which works to transform African agriculture from a subsistence model to one of solid businesses that improve the livelihoods of farming households- and the African Union Development Agency-New Partnership for Africa’s Development (AUDA-NEPAD) organized the recent “Africa-Americas Ministerial Summit on Agrifood Systems”, which was held in Costa Rica to strengthen bi-regional cooperation, face the challenges of food security and strengthen the role of both continents in productive matters at times where overlapping crises – health, environment and war- pose threats to world food security.
The United Nations Industrial Development Organization (UNIDO) presented its Industrial Development Report (IDR) 2022: The future of industrialization in a post-pandemic world at a side event of the Eighth Tokyo International Conference on African Development (TICAD8).
“Working together in global cooperation is of utmost importance to build a more resilient future”, said UNIDO Director General Gerd Müller in his pre-recorded opening statement. “As the global economy recovers from the COVID-19 pandemic, African countries face major challenges related to climate change and soaring food and energy prices. I call for an industrial development that is inclusive and sustainable to build dynamic, innovative and people-centered economies”.
“One of the IDR’s key findings is that countries with stronger industrial capabilities were more resilient to the economic impact”, said Nobuya Haraguchi, Chief of UNIDO’s Industrial Policy Research Unit during his presentation. “The report also identifies three megatrends that are changing the process of industrial development: industrial digitalization and automation; global production rebalancing; and industrial greening”.
At the conclusion of the 8th Tokyo International Conference on African Development (TICAD 8) hosted in Tunisia, the United Nations Development Programme (UNDP) welcomes a comprehensive package of support from Japan to drive economic growth, digital innovation, green transition and create jobs as the continent grapples with a series of challenges that threaten to undo many of the development gains achieved in recent years. “The impacts of the global food, energy and finance crises are rippling through communities across the globe. These cost-of-living spikes are having a particularly pronounced effect on the Continent of Africa where millions of people now face hunger and famine in regions like the Horn of Africa and the Sahel as climate-change-induced drought takes hold at the same time,” says UNDP Administrator, Achim Steiner.
“At this crucial moment, TICAD8 and its business forum have mobilized fresh development partnerships with the private sector that aim to generate additional investment in some African countries: helping to drive green economic growth defined by new jobs and better livelihoods as well as much-needed measures to tackle a climate crisis that is hitting faster than expected.”
A total of US$30 billion in public and private financial contributions were announced at the high-level meeting, including continuation of a $4 billion investment through Japan’s Green Growth Initiative for Africa to help address climate change on the continent.
Global economy
Investment treaty regime needs reforms to support climate action (UNCTAD)
UNCTAD has launched two issues’ notes dealing with the international investment treaty regime and climate action. A note entitled “International Investment Treaty Regime and Climate Action” provides countries with policy recommendations on reforming the regime to make it more aligned with climate action and other public policy imperatives. And another note entitled “Treaty-based Investor-State Dispute Settlement Cases and Climate Action” takes stock of such cases related to measures or sectors of direct relevance to climate action. “The current international investment agreements (IIAs) regime can constrain states when implementing measures to combat climate change,” the first note says. UNCTAD urges reform of the IIA regime to ensure investment treaties don’t hinder states from achieving a just transition to low-carbon economies.
Integrate trade into climate strategies, DG Okonjo-Iweala says at Africa Adaptation Summit (WTO)
“I feel trade is part of the solution. You might have financing, but if the trade policies don’t align, you may not be able to get the technologies you need for climate adaptation,” DG Okonjo-Iweala said at the event convened by the GCA in preparation for the COP27 climate summit to be held in Egypt in November. “Africa already faces a tremendous amount of costs with respect to adaptation. Through trade, we can increase the return on investment and increase the resources available to African governments for adaptation.”
The Director-General noted that Africa is likely to be the continent most affected by climate change, accounting for 80% of the world’s population that are most at risk, according to the Intergovernmental Panel on Climate Change. Agriculture will be among the sectors most at risk, with some studies estimating that climate impacts could cause crop productivity growth on the African continent to shrink by a third and lead to annual GDP losses of 3.8% by 2060.
Algeria a ‘reliable’ gas supplier: European Union chief Michel (The East African)
Algeria is a “reliable” energy supplier, European Council President Charles Michel said on Monday during a visit to the North African country as Europe scrambles to replace Russian supplies. “Given the international circumstances that we’re all aware of, energy cooperation is obviously essential, and we see Algeria as a reliable, loyal and committed partner in the field of energy cooperation,” Michel said after meeting President Abdelmadjid Tebboune. European officials have been looking to Algeria, Africa’s biggest gas exporter, to fill a shortfall in supplies after Russia’s invasion of Ukraine in February sent prices soaring.
Algiers has seen a string of high-profile visitors in recent months seeking to boost exports. Late last month, French President Emmanuel Macron welcomed moves by Algiers to help “diversify” Europe’s gas supplies.
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South Africa’s economy is ‘almost unfixable’ (BusinessTech)
Despite recent moves to cut red tape – especially for small and medium businesses – analysts and trade experts say the Department of Trade and Industry and Competition (DTIC) is actively ‘kneecapping’ investment in South Africa by trying to force businesses to do things its way. Chief executive of consultancy and advisory group XA Global Trade Advisors, Donald MacKay, told the Sunday Times that the department’s meddling in all aspects of trade and business has effectively deterred investment in the country at an unknown scale, leading to an economy that is “almost unfixable”.
He said that the government wants investment, to boost the economy and create jobs, but refuses to compromise – trying to force businesses into impossible contracts when seeking tariff relief or agreements that would benefit a business.
The government at least seems to be aware of this particular stumbling block at some level, with recent moves from the department cutting back on some of these requirements. The department this week published new regulations for public comment to cut back – or rather, provide exceptions – on restrictions on horizontal and vertical practices for small and medium businesses. This was in response to president Cyril Ramaphosa’s announcements that his administration would cut red tape for certain businesses in sectors that are struggling post-Covid-19. However, the department recently published new proposed regulations seeking to tighten up the country’s scrap metal trade.
Legitimate dealers in scrap metal – which stolen metals are ultimately exported as – would be burdened with more red tape, and the entire industry would suffer as a result. Meanwhile, the European Union has also taken issue with the plans, saying that they do not abide by the World Trade Organisation’s rules.
R1.1 Billion Disbursed to Women Owned Enterprises in the Last Three Years (the dtic)
Over the last three financial years, 139 women-owned enterprises operating in manufacturing, retail and services industries were supported and R1.1 billion was disbursed to fund these businesses. This was said by the Chief Operating Officer of the Industrial Financing unit at the Department of Trade, Industry and Competition (the dtic), Ms Susan Mangole during the Women’s Month Seminar hosted in Sandton.
“The total amount to these women-owned enterprise is R1.1 billion of which 55% was grants and 45% loans through partnership funds, 83 % of these enterprises are located in Gauteng, KwaZulu-Natal and Western Cape. 5 431 jobs were supported through these measures,” said Mangole. According to Mangole, the dtic, through its various sector master plans strives to support women enterprises. She said the support was offered as both financial and non-financial to unlock economic participation of women in the economy.
Beitbridge Border Post modernisation: Planning for systems, innovation and efficiencies (Sunday Mail)
The launch last Wednesday of a modernised Beitbridge Border Post marked a high point in the Second Republic’s vision of overcoming limitations of geography to make Zimbabwe a land-linked Economy. This goal behoved that we look at improving transport infrastructures, principally those to do with road, rail and air transport, so these talk to each other, and to systems in neighbouring countries. A key component of that thrust involved addressing inefficiencies and bottlenecks at all our ports of entry, with the goal of facilitating movement of people, vehicles, goods and services between borders. The transformation of Beitbridge thus has to be seen in that broad, sub-regional context. What makes Beitbridge’s upgrade especially significant is that it combines sub-regional, national and community objectives.
Zimbabwe, Botswana, Mozambique railway line on cards (Bulawayo24 News)
ZIMBABWE, Botswana and Mozambique are working on plans to establish a railway line to connect the three countries with a gateway to the sea, President Mnangagwa has said. Further, Zimbabwe and Botswana are working round the clock to establish a One-Stop Border Post at Plumtree-Ramokgwebana. This comes as Zimbabwe — under the Second Republic — is pushing to rejoin the Kazungula Bridge across the Zambezi River which will contribute to regional growth through increased traffic along the North-South corridor. The planned development will facilitate trade through reduced transit time for freight and passengers, reduced time-based trade and transport costs as well as improved border management operations arising from a one border facility.
EU double-edged sword for Kenya’s horticulture (Business Daily)
In the last couple of years, Kenya’s exports of major crops have come under threat over increased cases of chemical residues on horticulture produce that has seen Europe impose stricter checks, posing a threat to the country’s foreign earnings.
The European Union (EU) has lowered the requirements on residues to a bare minimum, meaning that any level found on the consignment whether high or low will be treated in the same way.
An increase in the number of exports intercepted not only subjects exporters to losses but also places the country at risk of being banned from shipping its produce to the EU until a corrective measure is taken.
“All the relevant bodies must come together to address the challenge of residues as increased checks on our export produce pose a risk of more products being intercepted and is risky for our exports,” said Kephis managing director Theophilus Mutui.
Trials on flowers are ongoing at the moment but they will be implemented next year. The move poses a major risk, should they be found to have high chemical residues given that flowers are the leading segment in terms of income on horticulture earnings. Flowers alone raked in Sh37 billion in six months to June this year out of the Sh48 billion that the horticulture sector realised in the review period.
Why upward review of agric budget in 2023 is imperative (The Guardian Nigeria)
A dismal 1.7 per cent was allocated to the Agriculture sector in the 2022 annual national budget – a far cry from the 10 per cent benchmark recommended at the Malabo Declaration on Accelerated Agricultural Growth and Transformation for Shared Prosperity and Improved Livelihoods. The declaration was the significant highlight of the 23rd Ordinary Session of the African Union Assembly in Malabo, Equatorial Guinea in 2014. Although the AU Heads of State and Government committed themselves to the declaration, majority of the countries, including Nigeria have failed to implement the deal.
Worried about this development, which has been linked to the increasing food crisis across the country, especially this year, stakeholders in the sector have girded their loins to influence the upward review of the sector’s national budget allocation across the various strata of government.
The Chairman of the Senate Committee on Agriculture, Bima Muhammad Enagi, said despite the challenges facing the sector, agriculture remains the largest contributor to the country’s GDP in the second quarter of 2022 at 23.3 per cent; beyond the contributions of Trade (16.8 per cent), Telecommunication (15 per cent), Manufacturing (8.7 per cent) and the Oil and Gas sector (6.3 per cent).
He said: “The agricultural sector has the largest potential to lead millions of Nigerians out of poverty. Thus, the sector should be given utmost priority in national economic policies and national and sub-national budgets.
Nigeria to pay $496m to settle claims over steel plants (Engineering News)
Nigeria has agreed to pay $496-million to settle a multi-billion dollar claim from Global Steel Holdings Ltd following the termination of a contract to upgrade the country’s steel plants, the presidency said on Saturday. Global Steel, which is linked to India’s Mittal family, had between 2004-7 acquired rights to Nigeria’s entire state steel industry via five major concessions and share purchase contracts. The deal also included access to Nigeria’s iron ore reserves and the central railway network.
Ethiopia, China enjoy comprehensive, strategic economic cooperation: official (Xinhua)
Ethiopia and China have a comprehensive strategic partnership, which has been cemented on a principle of win-win and mutual cooperation, a senior Ethiopian government official has said. Ahmed Shide, Ethiopia’s Minister of Finance, recently told Xinhua that the two friendly nations have been working to create a “community of shared destiny” amid establishing a strong relationship between their leaders. “Over the last decade, China and Ethiopia have worked together on many fields wherein China has been availing significant financial support to implement many great projects in Ethiopia like the Addis Ababa-Djibouti Standard Gauge Railway,” Shide said.
Highlighting that China helped Ethiopia carry out many roads, energy, industrial parks and water supply development projects, the finance minister emphasized that the Addis Ababa-Djibouti Standard Gauge Railway, also known as the Ethiopia-Djibouti railway, has served as a testimony of the early harvest of the Belt and Road Initiative.
According to the minister, China has been investing in existing industrial parks and setting up manufacturing plants both for domestic and international markets as more Chinese investors have been playing a visible role in Ethiopia’s economic development.
African trade and integration
Mrs Selma Ashipala-Musavyi, the Namibian Ambassador to Ghana, has called on Africans to enhance personal relationships across the Continent to advance the ideals of the African Continental Free Trade Area Agreement (AfCFTA). She said socialising across the continent would help in the appreciation of iridescent culture and build synergy for the development of trade and industry. “For meaningful intra-Africa trade to be sustained and beneficial, Africans must interact and visit one another’s countries. In so doing, we shall embrace one another and build confidence among ourselves,” Mrs Ashipala-Musavyi said. “We shall be exposed to and take pride in our rich and diverse African culture. Most importantly, we shall and begin to consume what we produce, and create jobs for our young people. This should be the content of intra African tourism.”
The East African Community (EAC) Secretary General, Hon (Dr.) Peter Mathuki, is set to lead a delegation comprising the Heads of EAC Organs and Institutions and eminent regional business leaders, to the bloc’s newest Partner State, the Democratic Republic of the Congo (DRC) from 6th September to 9th September, 2022.
The forum will provide a platform for heads of EAC Organs and Institutions to enhance awareness and understanding of the various commitments in the integration pillars and the governing instruments that are in place at the EAC level, to DRC government officials.
On 8th - 9th September, the private sector leaders accompanying the Secretary General will hold Business-to-Business (B2B) meetings with DRC entrepreneurs.
“Since the DRC joined the EAC, the entire bloc now is about 300 million people offering the region a tremendous market, with massive partnership and investment opportunities across sectors such as mining, agriculture, ICT and health. Equity BCDC is here in the DRC to help support finance these activities as a trusted partner to both the East African Business Council (EABC) and the EAC,” he added. The forum will also provide an opportunity for regional business leaders to deliberate on the challenges facing the private sector with the EAC Secretary General.
Somalia bids to join East African Community (Independent)
Just eleven days after the Democratic Republic of Congo ratified the East African Community Treaty on July 11, the bloc’s leaders agreed to fast-track the verification of Somalia’s application to join the community. Sitting on July 22 in Arusha, Tanzania, where the East African Community Secretariat is based, the East African Community Heads of State Summit agreed to fast-track the verification of Somalia’s application which it first sent in 2012. The Summit directed the Council of Ministers to expeditiously carry out the verification exercise in accordance with the EAC procedure for admission of new members into the EAC and report to the 23rd meeting of the Summit. This followed Somalia’s President, Hassan Sheikh Mohamud, formally requesting the Summit consider his country’s application to be the eighth partner state of the East African Community.
Zim moves to remove Comesa trade barriers (The Herald)
ZIMBABWE is one of only four members of Common Market for Eastern and Southern Africa (Comesa) member countries that have received capacity building support aimed at eliminating Non-Tariff Barriers on trade of common goods. This is in line with the requisite regulations of Comesa, a 21-member economic bloc whose population exceeds 583 million, entails a Gross Domestic Product of $805 billion and sees export/import trade in goods worth US$324 billion per year. Comesa forms a major market place for both internal and external trading.
The training follows an earlier decision by the Comesa Council of Ministers to provide technical support to member States to implement national NTBs elimination programmes which are premised on sound national NTBs elimination strategies. Comesa regulations for the elimination of NTBs provide legally constituted tools for reporting, monitoring and addressing NTBs, the institutional arrangements to manage the NTBs elimination process as well as procedures followed to tackle situations that create NTBs.
Africa is a Key Region for Sustainability (Mercados Africanos)
According to Deputy Secretary General of the UN, Amina Mohammed, the international community must change its perception of Africa from a dependent continent to a key region on the global stage, with the same rights and position as other continents. More than 1,2 billion people live in Africa. Approximately 60% of the African population is under 35 years of age. Rapid urbanization in African countries promises new opportunities, including in the field of industrialization on the continent. Amina Mohammed believes the continent can benefit from the Sustainable Development Goals and the 2063 Agenda for Africa moving forward.
The UN representative stressed that, in order to achieve these goals, the international community must jointly reduce the consequences of the numerous crises.
The UN Deputy Chief also spoke about the African Free Trade Area, which contributes to the industrialization, diversification and digitization of the economies of the countries in the region, as well as helping to strengthen regional cooperation.
Financial inclusion critical for African agriculture success (NewsDay)
INDUSTRY and Commerce minister Sekai Nzenza says financial inclusion for farmers is critical in modernising African agriculture. Speaking at the United Nations Industrial Development Organisation (Unido) forum last week, Nzenza said African farmers face difficulties in accessing credit, leading to a lack of investment in agricultural technologies. “Access to credit has a significant effect on the farmer’s decision to adopt modern technologies. Financial inclusion for farmers is critical for modernising African agriculture. In many African countries, farmers face difficulties in accessing credit, leading to lack of investment in new agricultural technologies,” she said.
Zimbabwe is implementing a five-year economic blueprint called the National Development Strategy 1, which prioritises value chains development. Agriculture is the mainstay of the Zimbabwean economy and manufacturing companies source 60% of their raw materials from the sector.
“A targeted strategic intention to ensure the growth of the agricultural sector which contributed 17% towards gross domestic product and accounts for US$302 million in the first half of 2021 through sector specific strategies,” she said. “More specifically, a contribution of the agricultural sector to industry through a robust local content strategy focusing on manufacturing for manufacturers looking at home grown solutions to reduce the import bill.”
Amina Mohammed called on the international community to work on three fronts that would benefit African economies and help achieve the Sustainable Development Goals.
Experts urge new model for Africa’s infrastructure growth (The Guardian Nigeria)
With the global infrastructure shortfall expected to reach $15 trillion by 2040, the World Forum for Africa (WOFA) and other experts have called for improved dialogue towards integration of labeling and certification ahead of infrastructure development in the continent. The experts, who said there is enormous need for infrastructure, noted that the move would boost long-term capital flows for projects and their sustainability. According to them, while public sector funding would continue to be important for infrastructure development, mobilisation of private sector investment will be critical to achieve global infrastructure investment goals effectively and efficiently. Some of these initiatives are FAST-Infra and Blue Dot Network.
Addressing the forum, the convener of WOFA, Abi Haruna, said the need for adequate representation of Africa in the global initiative for labeling and certifications for infrastructure projects cannot be over emphasised. According to him, the essence of the forum was to explore areas of cooperation in establishing an African inclusive labeling and standards for major infrastructure projects on the continent with the aim of de-risking, having sustainable, and environmentally considerate infrastructure.
Pan-African airline plans fly into headwinds (The East African)
The quest to create a pan-African airline through a joint venture between Kenya Airways and South African Airways by June next year is facing early turbulence after both carriers sought exemption from clauses on the competition. Kenya Airways (KQ) last week said it is seeking exemptions from the clauses in Kenya and regional trading blocs, several months after South African Airways (SAA) raised the same plea back home. The move means it will be difficult to implement the Single African Air Transport Market (SAATM) and the Africa Continental Free Trade Area (AfCFTA) initiatives that are key in having a continental airline.
The clauses about competition, among others, include sharing of resources and key information about the sector including hubs. This means KQ would have to seek exemptions from the Competition Authority of Kenya as well as the Common Market for Eastern and Southern Africa Competition Commission.
African countries must chart their unique paths toward achieving a just transition, experts during a session said, to assess the needs, challenges, and opportunities of implementing a just energy transition in Africa at Africa Climate Week. The event, titled The Just Transition in the African Context, was jointly organized by the African Development Bank and the African Climate Foundation. Laura Becerra of Neyen Consulting moderated. Faten Aggad, African Climate Foundation’s Senior Advisor on Climate Diplomacy, said: “Just transition is a process. It may take time to secure consensus among domestic actors and ensure inclusivity.” Speaking on the issue of scale, she said that while leapfrogging was possible at the household level, the transition could take longer for industry and other commercial sectors. There are significant gaps between financing commitments and disbursement in Africa, Aggad added.
Gareth Phillips, African Development Bank Manager for Climate and Environmental Finance, emphasized the need to view just transition from an African perspective and to ensure its relevance for all Africans.
ACTIF2022 ends with a commitment to building a commercial bridge for shared prosperity (Afreximbank)
The AfriCaribbean Trade and Investment Forum 2022 (ACTIF2022) successfully concluded in Bridgetown, Barbados, with a commitment by participants to remove the scars of the past and build a commercial bridge towards forging a prosperous future for Africa and the Caribbean. In the communique presented at the end of the Forum, the partners pledged the concrete implementation of strategic partnership between the business communities in Africa and the Caribbean with the objective of fostering bilateral cooperation and engagement in trade, investment, technology transfer, innovation, transport, tourism, culture and other services.
The signing of the Partnership Agreement between Afreximbank and seven Caribbean States will usher in investments to concretise the commercial relations between the two regions, with an immediate focus on establishing an air bridge , and business to business match-making through the newly established African-Caribbean Business Council.
AU Commissioner urges Africa and the Caribbean to strengthen trade ties (New Ghana)
Ambassador Muchanga who was making a statement at the Opening Ceremony of the Africaribbean Trade and Investment Forum held at Bridgetown, Barbados said the African Union would after the event, avail a comprehensive report to the African Union Member States with a strong recommendation for them to become a strategic partner of future editions. Albert Muchanga, African Union Commissioner for Economic Development, Trade, Tourism, Industry and Minerals has hinted that Africa and the Caribbean will strike a strong partnership in trade and investment.
12 Partnership Agreements, MoUs Raise Hope for Africa, Caribbean Trade Integration (This Day)
The signing of partnership agreements and Memoranda of Understanding (MoU) by representatives of corporate entities that attended the maiden AfriCaribbean Trade and Investment Forum in Bridgetown, Barbados has raised hope for the integration of the Caribbean into African trade. According to the agreement signed by CBB Governor, Mr. Cleviston Haynes; CBB Business and Finance Strategist, Mr. Ian Colleymore; and the Executive Vice President, Inter-African Trade Bank of Afreximbank, Dr. Kanayo Awani, Afreximbank will work with the CBB to promote its instruments of intervention with public and private enterprises to provide financing (funded and unfunded) to Caribbean entities to grow the volumes of trade and investment.
It’s full steam ahead for China-Africa trade flows (The Star Online)
On Aug 23, a ceremony in Beijing commemorating the arrival of the first batch of avocados from Kenya also served as a launchpad to welcome more African produce into the vast Chinese market. This follows the arrival of some 20 tonnes of fresh Hass avocados from smallholder Kenyan farmers in Shanghai on Aug 2. That same day, the China-Africa Business Council released a report on China’s investments in African countries and said the two sides have made great strides in all-around, multilevel and wide-ranging cooperation over the past 22 years. The report showed that Chinese companies are committed to investing in Africa’s supply chain.
Humphrey Moshi, director of the Centre for Chinese Studies at the University of Dar es Salaam in Tanzania, said China’s rise as one of Africa’s leading trade partners is owed to the fact that China’s investment portfolio in Africa is very diversified, covering a broad range of sectors. “In assessing the feasibility of China’s trade trajectory in Africa, we note that China does not apply the narrow Western assessment criterion of economic viability alone, but a much broader and more comprehensive criterion of socio-economic development,” Moshi said.
TICAD: Survey shows Japanese countries still cautious on Africa (African Business)
The promised explosion of Japanese investment in Africa remains more wish than reality, according to a Japanese government survey shared with delegates at the eighth instalment of the Tokyo International Conference on African Development (TICAD 8) in Tunis last weekend.
The number of Japanese companies in Africa with plans to expand in the continent was up more than 6% on the year before, to 49%.This contrasts with 45% of companies that expect to remain stagnant, and a 4% fall in the number of companies that expect to shrink their African operations, to just 5%. Moreover, almost 50% of surveyed companies report that the importance of Africa to their business has increased over the preceding five years, with 60% expecting that Africa will become even more important over the next five years. Yet while prospects are increasing, the total value of Japanese investment in Africa remains miniscule. Compared to the UK and France, which lead the way with 2021 FDI totalling $65bn and $60bn respectively, the US with $44bn and regional rival China with $43bn, Japanese FDI into Africa has fallen from a high point of $12bn in 2013 to just $5.8bn last year.
Global economy
2nd Illicit Trade Forum (UNCTAD)
Following the inclusion of illicit trade as the only new area of work in the outcome document of UNCTAD15, the Bridgetown Covenant, UNCTAD will host the second iteration of the Illicit Trade Forum in September 2022. The event will be organised in collaboration with the Transnational Alliance to Combat Illicit Trade (TRACIT).
Illicit trade significantly endangers all aspects of the SDGs, creating a triple threat to the financing of development: crowding out legitimate economic activity, depriving governments of revenues for investment in vital public services and increasing the costs of achieving the SDGs by eroding the progress already made. Further, identifying, quantifying and combatting illicit trade requires significant investments from member States and collaboration amongst international organisations, along with cooperative efforts from private sector stakeholders. To address these issues, the two-day Forum will hold interactive panel discussions on the following topics:
Hitting reset button with China debt cancellations (Monitor)
Without giving much away, the Chinese government recently revealed that it will write off 23 matured interest-free loans for 17 Least Developed Countries (LDC) in Africa. The classification rules out Kenya and Tanzania who are lower-middle-income countries as per the World Bank. The World Bank recently confirmed that Uganda is still in the LDC classification as President Museveni appeared to indicate otherwise. “The President was very clear. He never declared Uganda a middle income; it is not his business,” Mr Ramathan Ggoobi, Uganda’s Secretary to the Treasury, said at the Economic Growth Forum in August.
What isn’t in dispute is that Uganda is saddled in debt. Its public debt currently stands at approximately Shs74 trillion ($19.5 billion), with Shs47 trillion ($12.3 billion) of it external. While any debt cancellation will remove a millstone round the country’s neck, past precedents indicate that it will not be a silver bullet.
A recent policy paper by United States Agency for International Development (USAID) and Southern and Eastern Africa Trade Information and Negotiations Institute (Seatini) indicated that Uganda has already exceeded thresholds on the present value of debt-to-revenue and is closer to the thresholds of other indicators except for debt service-to-exports ratio.
Egypt prepares for flagship UN climate conference, in a year of unprecedented global weather shocks (UN News)
Regional authorities in Egypt, the host country of the 2022 UN climate conference (COP27), are ramping up initiatives designed to improve the country’s environmental credentials, and speed up its transition to a low carbon economy. The event will begin on 4 November, in the Egyptian resort city of Sharm El-Sheikh.
Several COP27-related initiatives are underway in Egypt: they include projects related to sustainable transport, waste recycling, women’s health, the transition to clean energy, sustainable cities, adaptation measures in the water and agriculture sector, and the links between peace and climate. Beyond COP27, Egypt is working towards a 2050 national climate strategy, which is based around the reduction of emissions in all sectors, and adaptation to potential changes in the climate – in agriculture, water resources, coastal areas, and health.
World food commodity prices dip for fifth month in a row in August (FAO)
The barometer for world food commodity prices declined for the fifth consecutive month in August, as quotations for most benchmark items dropped, according to a new report released today by the Food and Agriculture Organization of the United Nations (FAO). The closely watched FAO Food Price Index averaged 138.0 points in August, down 1.9 percent from July although remaining 7.9 percent above its value a year before. The Index tracks monthly changes in the international prices of a basket of commonly traded food commodities.
FAO also today issued its updated cereal production forecast for 2022, with a significantly lower outlook. Global cereal production is anticipated to decline by 38.9 million tonnes, or 1.4 percent, from the previous year, according to the new Cereal Supply and Demand Brief. World trade in cereals is predicted to decline by 1.9 percent in 2022/2023 (July/June) from the year-earlier period, to 469.6 million tonnes.
G7 Finance Ministers statement on Russia’s war of aggression against Ukraine (GOV.UK)
We, the G7 Finance Ministers, met on 2 September 2022 to discuss our united response to Russia’s war of aggression against Ukraine and the war’s harmful impact on the global economy. We continue to condemn the brutal, unprovoked, unjustifiable and illegal war of aggression against Ukraine by Russia and aided by Belarus. Russia’s war of aggression is causing global economic disruptions and is threatening the security of the global supply of energy and food. The economic costs of the war and consequent price increases are felt disproportionately by vulnerable groups across all economies and particularly by those countries already facing food insecurities and fiscal challenges.
We confirm our joint political intention to finalise and implement a comprehensive prohibition of services which enable maritime transportation of Russian-origin crude oil and petroleum products globally – the provision of such services would only be allowed if the oil and petroleum products are purchased at or below a price (“the price cap”) determined by the broad coalition of countries adhering to and implementing the price cap. The price cap is specifically designed to reduce Russian revenues and Russia’s ability to fund its war of aggression whilst limiting the impact of Russia´s war on global energy prices, particularly for low and middle-income countries, by only permitting service providers to continue to do business
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Local news
EU warns SA scrap export ban may contravene WTO obligations (Fin24)
The European Union has raised concerns over Minister Ebrahim Patel’s plans to ban the exports of scrap metal as a measure to prevent theft, warning that such “trade distorting measures” may contravene South Africa’s obligations as a member of the World Trade Organisation. The issues were raised in a written comment submitted by the EU to the Department of Trade, Industry and Competition on its policy proposals to curb scrap metal theft in South Africa. The most contentious of the proposed measures is a six-month ban on the exportation of ferrous and non-ferrous waste and scrap metal to curb theft while other regulatory measures are put in place. The EU has, however, argued that South Africa should first put measures in place at a domestic level before contemplating an export ban.
Increased dumping of chicken expected, particularly from Brazil (Moneyweb)
The poultry industry expects to see an increase in dumped imported chicken, particularly from Brazil, within the next few months after receiving a “licence” to continue their dumping from Minister of Trade, Industry and Competition Ebrahim Patel. According to a report by the FairPlay Movement, Rainbow Chicken (owned by JSE-listed RCL Foods) has called for the immediate imposition of anti-dumping duties on bone-in chicken portions from Brazil, Denmark, Ireland, Poland and Spain. The South African Poultry Association (Sapa) says they have reconciled themselves to Patel’s decision to suspend the imposition of anti-dumping duties for 12 months, but it will hurt the industry.
The International Trade Administration Commission (Itac) found evidence of dumping and introduced provisional anti-dumping duties for six months at the end of last year. After receiving submissions and comments from several importers from the affected countries and local stakeholders it recommended the introduction of the duties for a period of at least five years.
However, Patel considered the “current rapid rise” in food prices locally and globally and the impact the imposition of the anti-dumping duty may have on the price of chicken and postponed the imposition of the tariffs by a year.
Sapa CEO Izaak Breytenbach says the minister has wrongly assumed that the tariff increase will lead to increased prices. “We have always argued that an increase in tariffs has never led to an increase in consumer prices.” The main reason is that consumers never benefit from the lower prices. Imports are priced at market or slightly lower prices than the price of local products.
Breytenbach says Sapa expects to see the quantum of the increase in about three months’ time when the South African Revenue Service publishes the latest import statistics. He says the industry will not take any legal action because of the suspension of the tariffs, but still finds it “surprising and disappointing” that the minister decided not to protect the local industry while acknowledging that dumping of bone-in chicken portions is causing producers “material harm”.
Better coordination and collaboration can speed up the process of resolving the ban on vegetable exports (Cape Business News)
Better coordination and collaboration can speed up the process of resolving Botswana and Namibia’s ban on South African vegetable exports. For this reason, the participation of key role players from different spheres of government dealing with market access issues is essential to speedily identify and resolve market access challenges. Botswana and Namibia’s recent unilateral decision to block some fruit and vegetable exports from South Africa is unfortunate and contradicts the existing Southern African Customs Union (SACU) trade agreement. In 2021 the Western Cape’s total vegetable export to the SACU totalled R268 million, with seventy-five per cent of this destined for Namibia and Botswana.
Import tariffs and non-tariff barriers continue to represent critical barriers to South Africa’s agricultural exports. Importantly, they should never become arbitrary or unjustifiable. However, when they do, they pose a discriminatory challenge for an export market, countering the benefits of a duty-free trade formed through customs unions or regional economic regions. While trade diplomacy is facilitated at a national government level with the partner country, leveraging the relationships that the Western Cape Department of Agriculture (WCDoA) has established through its commodity approach model could streamline processes to speed up discussion among role players.
TIASA takes SATMC, ITAC to court as tyre battle intensifies (Engineering News)
The Tyre Importers Association of South Africa (TIASA) has applied to court to compel the International Trade Administration Commission of South Africa (Itac) and the South African Tyre Manufacturers Conference (SATMC) to disclose what it says is “critical information that is being withheld” regarding SATMC’s application for the implementation of anti-dumping duties on imported tyres. The aim is also to challenge the manner in which Itac is conducting the investigation. SATMC, which includes Continental, Bridgestone, Goodyear and Sumitomo, has applied to Itac for the implementation of additional duties of between 8% and 69% on passenger, taxi, bus and truck vehicle tyres imported from China.
Current import duties levied on tyres range from 25% to 30%.
Uganda and Rwanda resume talks to revive bilateral ties (The East African)
Rwanda and Uganda have officially resumed diplomatic talks, a significant step towards reviving relations between the two countries that were at loggerheads for almost three years till the beginning of this year. A delegation of Ugandan officials led by the Foreign Affairs Minister Odongo Jeje Abubakhar held talks with their Rwandan counterparts on Thursday in Kigali.
In a joint statement released after the meeting on Thursday, the countries said the diplomatic and political consultations are a continuation of the commitment of the heads of State to deepen further and strengthen the cordial relations between the two countries. “The ministers exchanged views on regional matters relating to security, trade, investment, and strategic regional projects. “They agreed to review and revive bilateral cooperation in the different areas of interest by convening the next Joint Permanent Commission between Rwanda and Uganda,” the statement reads.
Ismael Buchanan, a Kigali-based political analyst and lecturer of International Relations at the University of Rwanda, says reviving bilateral trade should be a priority. “There has been tremendous progress made in Rwanda and Uganda relations this year. The constant visit by officials is key because there are still issues that need to be addressed, including trade. There is hope, but we are yet to see Ugandan products on Rwanda’s market as we used to,” he said.
IMF board approves $1.3 billion for debt-ridden Zambia in bailout (The East African)
The International Monetary Fund (IMF) has approved a $1.3 billion loan to Zambia to help the debt-ridden country restore fiscal stability. In 2020, battering the Covid-19 pandemic and choking under the weight of loans, Zambia became the first country in Africa to default on foreign debt. According to official government data, the southern African country’s debt totalled $31.74 billion at the end of 2021, of which $17.27 billion was external debt, mostly from two Eurobonds and China.
Africa’s second-largest copper producer has struggled to jumpstart its economy as it grapples with a debt load reaching 120 percent of the GDP. The country had reached a tentative agreement with IMF in December for a $1.3 billion facility, contingent on Zambia taking steps to reduce its debt to levels IMF deemed sustainable. In late July, its creditors led by China and France, pledged to negotiate a restructuring of Zambia’s debts, a move IMF Managing Director Kristalina Georgieva said was “clearing the way” for funding.
Kwara Customs boss to enforce new ECOWAS tariff (The Guardian Nigeria)
Nigeria Customs Service (NCS) Area Controller, Kwara State Command, Aliyu Bello, is set to enforce the reviewed Economic Community of West African State (ECOWAS) Common External Tariff (CET) in the state.
The Federal Government, early this year, approved the implementation of the 2022 fiscal policy measures, comprising Supplementary Protection Measures (SPM) for the implementation of the CET 2022-2026 and Excise Duty of N10 per litre on non-alcoholic beverages, cigarettes and tobacco products from April 1, 2022. A grace period of 90 days was granted to enable the excise factories producing non-alcoholic and beverages to prepare for compliance with the new directives, which elapsed on June 30, 2022. The new price regime commenced on July 1, 2022.
AGI advocates abolition of import tax on raw materials (BusinessGhana)
That the AGI said would help address the depreciation of the Cedi and enhance the industrialisation of the government. The President of AGI, Dr Humphrey Ayim-Darke, who stated this in an interview with the Ghanaian Times on the sidelines of the launch of the African Continental Free Trade Area (AfCFTA) Hub, said the five-per cent tax imposed on imported raw materials and the benchmark discount values were disincentive to local production and was encouraging the importation of finished goods into the country.
According to the AGI President said such a move would be beneficial to the country and help the government to raise more tax revenue. In spite of the increase in freight charges and disruptions in global supply chains occasioned by COVID-pandemic and Russia-Ukraine war, there was increase in importation of finished products into the country, exerting pressure on the cedi.
African Development Bank Vice-President for Private Sector, Infrastructure and Industrialization, Mr. Solomon Quaynor, officially visited Mozambique last week. He met with Mozambican government representatives and members of the private sector. Discussions covered the bank’s country strategy for Mozambique, recent reforms the government has undertaken, and the country’s strategic energy and transport sectors in particular.
Quaynor commended the government for pushing through reforms that are expected to accelerate economic recovery from the impacts of the Covid-19 pandemic and tropical cyclones Idai and Kenneth. He said the government’s reforms align with the bank’s new country strategy, covering the 2022-2027 period, and its initiatives to strengthen the private sector. The bank’s new country strategy prioritizes economic private sector investment and structural transformation of agricultural value-chains.
Under the previous country strategy, which covered the period 2017-2022, Mozambique launched or completed several key projects. They included the Nacala corridor, Temane transmission lines, the Pemba-Lichinga special agro-processing zone and the Drought Recovery and Agriculture Resilience initiative. Discussions also covered transport and logistics infrastructure. Magala said: “Mozambique has a strategic geographic location in the region, making it an ideal route to port access for neighboring landlocked countries including Zimbabwe, Eswatini, Malawi and Zambia. Strategic and innovative investments in improving the major transport systems and port efficiency can transform Mozambique into a major logistics hub.”
Egypt’s investments in Africa up to $10.2 bln; trade volume with Ivory Coast up 178%: Trade minister (Ahram Online)
Samir made the remarks during celebrations of Ivory Coast’s 62nd National Day at the country’s embassy in Cairo on Wednesday. In a speech during the ceremony, Samir conveyed the greetings of Prime Minister Mostafa Madbouly to the Ivorian government and people on the occasion of the country’s National Day, which is celebrated annually on 7 August. Samir said the public and private sectors in Egypt and Ivory Coast have worked in recent years to boost trade and economic relations, leading to the large increase in trade volume in 2021. The minister said that the commodities exchanged between the two countries include electrical machines, paper, plastics, glass, iron, steel, cocoa, wood and fruits.
Egyptian Trade and Industry Minister Ahmed Samir highlighted Egypt’s keenness to enhance investment cooperation with the countries of the African continent, noting that African economic development is one of the most important priorities of the Egyptian state.
Libya Economic Monitor – September 2022 (World Bank)
Libya is struggling to cope with a trifecta of crises, including the civil conflict, the COVID-19 pandemic and most recently, the impact of the Russia-Ukraine crisis. Notwithstanding the tempering of conflict intensity since 2021, the Libyan economy has been battered by the conflict. GDP per capita estimates in 2021 stood at about half of its value in 2010 before the start of the conflict. Since 2020, the population has been hit by multiple waves of the COVID-19 pandemic. In addition, food insecurity has worsened, precipitated by the Russia-Ukraine crisis and the resulting shortages and price increases for staple foods in the domestic market.
Libya’s trade and current account balances rebounded in 2021 and early 2022, thanks to recovering oil exports and receipts. Estimates reveal that Libya’s reserve position remains very comfortable. The official exchange rate remained relatively stable throughout 2021, but depreciation pressures are increasing. The economic outlook is uncertain. It is impossible to forecast economic outcomes with any degree of confidence due to the high uncertainty surrounding political and security developments. However, if Libya manages to maintain or ramp up oil production and exports compared to 2021, or at least avoid extended disruptions, it could benefit from soaring global oil prices, which would translate into strong economic growth, higher fiscal revenues and an inflow of hard currency. This would positively affect the trade, current account, and fiscal balances.
African trade and integration
SADC electronic Certificate of Origin to be launched on 7th September 2022 (SADC)
As part of the ongoing efforts to increase intra-regional trade and aid the regional economic development, the Southern African Development Community (SADC) will launch the SADC electronic Certificate of Origin (e-CoO) in Blantyre, Republic of Malawi, on 7th September 2022 under the theme ‘Enhancing trade facilitation through the SADC Electronic Certificate of Origin’. The official launch will be preceded by a workshop to be held on 6th September 2022, which will draw participants from SADC Member States, customs officials and private sector to deliberate on the significance of improving the SADC intra-regional trade through the smooth movement of quality goods across the borders with the overall objective of aiding the region’s economic development.
The development of the eCoO is one of the milestones of the Trade Facilitation Programme (TFP), which is supported by the European Union and provides for capacity-building and technical assistance in border cooperation by ensuring the implementation of SADC Coordinated Border Management Guidelines and the provisions of the World Trade Organisation (WTO’s) Trade Facilitation Agreement, particularly on improving the efficiency of their operations. The e-CoO, which replaces the manual SADC Certificate of Origin issued by the issuing authority in the country of origin of the goods, will help the trader to apply on-line, trace the application and get the response on the submission digitally, thus infusing efficiency in the process.
1,882 standards in East Africa set for harmonisation (The Citizen)
Some 1,882 standards have been designated for harmonisation in a renewed drive to bolster trade within the East African Community (EAC) bloc. However, the slow speed of harmonisation is said to have been impeding trade among EAC member states. Intra-EAC trade has remained static at 15 percent of the total trade with the rest of the world in recent years, according to official data. Only 31.9 percent of standards that have been designated for harmonisation in the region have been harmonised, some partially. This was revealed yesterday during a regional public and private sector consultative engagement on standards organised by the East African Business Council (EABC).
“They have been harmonised by between 65 and 90 percent,” said Mr Dafa when giving his opening remarks on behalf of EABC hief executive John Bosco Kalisa. He said the harmonisation process was still impeded by several challenges, including NTBs and low adoption. “The importance of standards in trade cannot be overemphasised,” Mr Dafa said. “Where standards have not been harmonised, significant differences have emerged between national standards within the regional economic communities (RECs), thus creating major impediments to trade for producers and traders.”
Digital Journeys: Freeing Foreign Exchange in Africa (IMF)
A big problem for Africa’s economic development is the expense and difficulty of making payments across borders. It is one reason trade among Africa’s 55 countries amounts to only about 15 percent of their total imports and exports. By contrast, an estimated 60 percent of Asian trade takes place within the continent. In the European Union, the proportion is roughly 70 percent.
“When the payments are unlocked, invariably you are unlocking trade between African countries,” says Owusu Banahene, the Ghana country manager for AZA Finance, which handles foreign currency transactions for companies doing business in Africa. Cross-border payments are just one of the many barriers to trade in Africa. Others range from high tariffs and cumbersome border procedures to divergent commercial regulations and congested roads.
Meeting Of African Ministers of Finance, Economy, Development and Environment ahead of COP27 (UNECA)
The world is in the throes of a cumulative crisis – the COVID-19 pandemic, economic decimation and climate change and environmental degradation. When the Ukrainian crisis that is hitting several countries in such diverse sectors as wheat and tourism with full force, is coupled with this, the equation becomes much more complex and innovative approaches are vital. There is consensus that a green pathway which promotes carbon neutral investments, clean jobs and reduced pollution will guarantee sustainability.
The rapid and far-reaching transitions required to stay within the Paris Agreement temperature target require enormous financing. For African countries, already committing between 3-9% of its budgets to finance climate change adaptations, such financing requires significant support from partners at a scale far larger than has been mobilised so far, and through appropriate instruments that are relevant and responsive to the specific needs and circumstances of Africa.
The overall objective of the meeting is to i) ensure coherence of African climate finance positions with needs and ii) prioritise actions that can be led by African countries with targeted support to increase climate finance available for implementation.
Focus switches to COP27 as African leaders gather in Gabon for Africa Climate Week (The Commonwealth)
Speaking at the opening ceremony, which kicked off in Gabon’s capital, Libreville, on 29 August, the Commonwealth Secretary-General noted that climate change is a profound challenge for Africa, where 21 countries are members of the Commonwealth. “Climate change is perhaps the greatest challenge of our time,” the Secretary-General said, adding that it poses an existential threat to small states and is “a threat multiplier which amplifies existing social, political, and economic inequalities.” The high-level event comes just months before the UN Climate Change Conference COP27 is scheduled to take place in Sharm El-Sheikh, Egypt, in November, and brings together ministers, officials from key UN and multilateral agencies and more than 1,000 delegates from 42 African countries.
Noting the urgency for climate action and the importance of the two events being held on African soil, the Commonwealth Secretary-General said: “Africa Climate Week is an important opportunity for us to come together, to work together and to share with, listen to, and learn from one another. “Africa is a central player in the modern Commonwealth, and climate change is a profound challenge for Africa – so climate change in Africa is a central consideration for the Commonwealth.
“Tackling climate change will require the most significant political, social and economic effort that the world has ever seen. It is up to us to set the tone and shape the quality of that effort.
Afreximbank reveals plans for Caribbean Exim Bank as AfriCaribbean Trade and Investment Forum opens (Afreximbank)
The first-ever AfriCaribbean Trade and Investment Forum (ACTIF2022) opened today in Bridgetown, Barbados, with African Export-Import Bank (Afreximbank) announcing that it would work with governments of the Caribbean Community (CARICOM) to set up a Caribbean Exim Bank and that it envisaged committing an investment of US$700 million in the Caribbean. The forum is being held under the theme ‘One People, One Destiny: Uniting and Reimagining Our Future’.
Professor Benedict Oramah, President and Chairman of the Board of Directors of Afreximbank said: “Once these arrangements are concluded and visible, we will also open an office here in the Caribbean. And if we do agree, the Bank will work with governments of the CARICOM to set up a Caribbean Exim Bank as an Afreximbank subsidiary or affiliate,” adding that Afreximbank “envisages committing an investment of US$700 million in the Caribbean as soon as a regional office is opened.”
“We will want to leave here with actionable proposals on how to open air and sea links between the Caribbean and Africa. We would like to leave here with concrete plans to open banking and payment rails, to see joint ventures for industrial projects, to deepen our commercial collaboration in the creative and commercial space, to collectively protect our intellectual properties to share knowledge and invest in climate adaption projects. We must be proud that this is a reunion arising out of a felt need, underpinned by a solid economic, cultural, historical rationale,” added Professor Oramah.
Expanding African-Caribbean Trade (ITC)
The International Trade Centre (ITC) today launched a new report that identifies $1 billion in export potential between Africa and the Caribbean. ITC and the African Export-Import Bank (Afreximbank) also extended their five-year partnership, which will help tackle trade barriers and build business capacity to realize that potential.
ITC’s Expanding African-Caribbean Trade report highlights that partnerships such as this one with Afreximbank are needed to tackle the economic consequences of global crises. The report shows how the two regions have an export potential exceeding $1 billion in sectors ranging from agrifood and healthcare to tourism, fertilizers and automobiles. Unlocking this potential requires stronger relationships between African and Caribbean traders, the removal of trade obstacles such as high tariffs and non-tariff barriers, and greater investment in growth areas. The goods trade between the two regions is negligible and concentrated in just a few sectors including primary minerals and chemicals.
With the right support in place, Africa could boost its annual exports of merchandise to the Caribbean by $171 million by 2026, a 54% increase over 2020 levels. The Caribbean could expand goods exports to Africa by $80 million or 29% – and its exports of services such as travel and transport even more.
Afreximbank tackles banking sector market failure (Sunday Mail)
AfriCaribbean Trade and Investment Forum heralds dawn of new cooperation (African News Magazine)
Egypt’s trade minister urges more inter-Arab cooperation to face economic challenges (Ahram Online)
Egypt’s Trade and Industry Minister Ahmed Samir addressing the opening of the 110th session of the Arab League’s Economic and Social Council, which kicked off at the ministerial level at the Arab League General Secretariat HQ in Cairo on Thursday. The minister made the remarks while addressing the opening of the 110th session of the Arab League’s Economic and Social Council, which kicked off at the ministerial level at the Arab League General Secretariat HQ in Cairo on Thursday.
Earlier this year, Egypt presided over the council’s 109th session, during which one ordinary session was held, and two extraordinary sessions were held at the ministerial level. The 109th session also approved the acceptance of the certificate of origin issued electronically, and also adopted the Transit Transport Agreement between Arab countries.
The Egyptian minister praised the outcomes of the previous session as a reflection of Arab countries’ belief in the importance of establishing a framework for providing adequate facilities and benefits as well as simplifying the procedures that impede the movement of transport across Arab lands. He said that accepting e-certificates of origin was one of the much-needed requirements to facilitate trade to achieve better integration in global markets, while the transit transport deal is expected to reflect positively on the Arab region and its inter-trade.
Global economy
UNCTAD convenes second forum to ramp up fight against illicit trade (UNCTAD)
UNCTAD will host its second Illicit Trade Forum on 6 and 7 September, providing a platform for countries to collaborate on tackling this menace to development. The event to be held in Geneva and online is organized in collaboration with the Transnational Alliance to Combat Illicit Trade (TRACIT).
UNCTAD defines illicit trade as the transaction of any goods that fail to comply with legislative and regulatory frameworks, including in the ways in which they are produced, transported, certified or sold. Examples include trade in endangered species and falsified medicines and illicit financial flows related to drug trafficking, terrorist financing, trade misinvoicing and aggressive tax avoidance. “When trade is fair, rules-based, and strategic – trade is a source of good, a source of development that can help us achieve our Sustainable Development Goals. Illicit trade is the opposite of this. Illicit trade is neither fair, nor legal, nor purposeful,” UNCTAD Secretary-General Rebeca Grynspan said.
How Blockchain is being used to build trust across value chains (Engineering News)
Distributed ledger technologies, such as blockchain, in which immutable copies of ledger entries are shared with all stakeholders, are being used to improve the speed at which members and whole supply chains can react to changes, and the transparency of the entire value chain, as verification can be done at each conversion or value-adding step. Transparency and visibility across a supply chain will boost trust, which will, in turn, increase the speed at which supply chain processes can be completed, says technology analysis organisation Edge of NFT cofounder Dr Eathan Janney.
G-20 ministers at odds at Bali climate action meeting (Asia News Network)
A Group of 20 meeting of environment ministers in Bali concluded on Wednesday without a joint communiqué for a leaders’ summit later in the year, with group chair Indonesia saying some countries had disagreed on the proposed document’s wording. Speaking at a press conference after the one-day gathering, Environment and Forestry Minister Siti Nurbaya Bakar said the meeting chair would be issuing a summary of discussions instead of a joint communiqué as a result of the differing views.
“In the process, the discussion on these commitments has been quite challenging given the various views and implications for the interests of each member country,” Siti told reporters. Commitments discussed at Wednesday’s meeting included efforts to reduce the impact of climate change, the loss of biodiversity and land damage, as well as efforts to reduce pollution and environmental damage.
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Local news
Payments Association reconfigures for digital inclusion (ITWeb)
The South African Reserve Bank’s (SARB’s) decision to restructure the Payments Association of South Africa (PASA) into the new co-designed Payments Industry Body will stimulate innovation and promote collaboration and financial inclusion in SA’s financial sector. This was the word from Chris Wood, regional MD of Southern Africa and PALOPS region, at payments solutions firm Network International. Speaking to ITWeb on the side-lines of the ninth Africa Bank 4.0 Summit hosted by Network International, Wood discussed the current state of SA’s banking system and how the newly-formed Payments Industry Body is expected to boost digital inclusion by accelerating digital transformation in the sector. PASA is the payment system management body recognised by the SARB, in terms of the National Payment System Act of 1998.
In June 2021, the SARB announced plans to reform PASA into the new Payments Industry Body, in efforts to add an inclusive community of payment system stakeholders from other emerging industries, such as e-commerce and fintech players, as committee representatives. According to SARB, the new body was introduced in efforts to achieve and maintain interoperability, support the execution of Vision 2025 and other policy goals, in the interest of the National Payment System.
pdf The National Payment System Framework and Strategy Vision 2025 (1.06 MB)
DTIC issues draft regulations exempting SMMEs from some practices set out in the Competition Act (Engineering News)
Trade, Industry and Competition Minister Ebrahim Patel has announced the publishing of a draft notice in the Government Gazette on August 31 which sets out proposed terms for a new block exemption for small-, medium-sized and microenterprises (SMMEs) to be exempted from certain categories of prohibited agreement practices laid out in Competition Act. Speaking at the sixteenth Annual Competition Law, Economics and Policy Conference in Sandton, Patel said the purpose of the exemption would be to enable greater collaboration between SMMEs that would otherwise contravene Sections 4.1 and 5.1 of the Competition Act.
South African energy issues need joint effort - Minerals Council (Engineering News)
South Africa’s energy conundrum will require a concerted effort by both industry and government, the Minerals Council South Africa said. Speaking to Mining Weekly Online on the sidelines of Paydirt’s Africa Downunder conference, in Perth, Minerals Council CEO Roger Baxter said that the solution to solving South Africa’s energy crisis is unlocking ‘massive’ private sector investment.
South African, Egyptian competition authorities sign MoU (Engineering News)
The Competition Commission South Africa has signed a memorandum of understanding (MoU) with the Egyptian Competition Authority (ECA) to establish a general framework for bilateral communication and cooperation in the fields of competition law and policy, as well as enforcement. The MoU, which was signed at the sixteenth Annual Competition Law, Economics and Policy Conference in Sandton, Johannesburg, on August 31, forms part of multilateral competition initiatives aimed at strengthening bilateral ties by enhancing technical cooperation and information sharing on respective competition laws and policies.
SA trade surplus widens to R24.76bn in July (Moneyweb)
Namibia to learn from Equatorial Guinea on LNG development (Gas World)
A high-level delegation led by Hon. Tom Alweendo, Namibia’s Minister of Mines and Energy, is conducting a diplomatic visit to regional gas leader, Equatorial Guinea, this week with the aim of strengthening energy ties and expanding dialogue between the two nations.
Having made two sizeable oil and gas discoveries this year, Namibia is committed to seeing these developments come online as soon as possible. In May 2007, EG LNG’s first cargo was delivered, making it one of the fastest LNG projects in terms of the timeline it took from final investment decision to first cargo - and Namibia’s Minister Alweendo is hoping to replicate the project’s development. A group of Namibian engineers will stay on in Equatorial Guinea for the next four months, training and working closely with Equatorial Guinean nationals.
Minister Alweendo said, ”This way, it will accelerate the process for us to build the skills. It is a new industry for us so we need to start building those skills and this agreement will really help us and we are thankful for that. As Africa, we need to start increasing collaboration among ourselves.”
Mobile money agents handled a third of Kenya’s GDP in six months (Business Daily)
One in every three shillings spent by consumers, businesses, and the government in Kenya in the first six months of the year moved through mobile money, cementing the country’s position as a global leader in the mobile money revolution.
The latest data published by the Central Bank of Kenya (CBK) shows that the cash handled by mobile money agents in the first half of the year increased by 17.5 percent to Sh3.8 trillion. The data, which tracks the monthly performance of mobile money, shows growth from Sh3.26 trillion over the same period last year.
The cash, which is mainly handled by Safaricom’s M-Pesa agents, represents 31 percent of the country’s 2021 gross domestic product (GDP) that was recorded at Sh12 trillion.
The deepening of mobile money in the country is behind the push for full interoperability that was completed in July, as all the players demanded a share of the party.
The Kenyan economy is largely made up of the informal sector, and the adoption of other forms of sending money or settling payments has grown faster, giving commercial banks a run for their money.
‘Add Local Value To Resources To Avoid Global Shocks’ (Leadership)
The chairman of BUA Group, said there is need to add local value to resources to avoid global shocks. BUA Group, has invested in a vertically integrated sugar facility in Nigeria’s Kwara state. The $400 million project includes a 20,000-hectare sugar plantation, a sugar milling plant, a sugar refinery, an ethanol plant and a 35 MW power plant fuelled by bagasse, a sugar cane residue.
Sugar may not get the attention of other crops, even though it is frequently in the top five crops traded globally by value. Africa has some important producers – notably in Southern Africa such as Eswatini and Mozambique, but countries such as Nigeria, Egypt and Algeria still import more than they consume. In Nigeria imports account for 90 per cent of consumption.
Rabiu, said sugar is one of many low-hanging fruits when it comes to the agricultural opportunity and to working within the country’s import substitution strategy, saying BUA group, one of the most important diversified conglomerates in Nigeria, is already the fourth largest listed company in Nigeria by market capitalisation, operating in foods, cement, mining and infrastructure, and now agricultural production and processing.
He said localised production is key, pointing out that, the conflict between Russia and Ukraine has once again highlighted Africa’s vulnerabilities. “Countries that produce what they consume have been better able to manage their inflationary risk,” he said.
Two years on, Nigeria still preparing for AfCFTA (The Guardian Nigeria)
Almost two years after the implementation of the African Continental Free Trade Area Agreement (AfCFTA), which came into force on January 1, 2021, Nigeria continues to lag behind in making the trade agreement operational owing to structural challenges, lack of consensus on trade protocols and strategy among stakeholders.
Though the country continues to express readiness to commence trading, the political will to implement the deal remains in doubt going by the pace and protectionist stance of Nigeria and other African governments.
Already, seven countries, including Rwanda, Cameroun, Egypt, Ghana, Kenya, Mauritius and Tanzania have been selected among countries to start trading under the AfCFTA framework in a pilot phase.
The move seeks to test the environmental, legal and trade policy basis for intra-African trade, according to the AfCFTA secretariat. The countries were selected from the 36 that had expressed interest in trading under the pilot phase. Each of the applicants had submitted its tariff schedule.
The Secretary said Nigeria must pay attention to trade facilitation, policies, infrastructure, trade information, free movement of people and goods, finance and institutional coordination between the federal government and private sector.
Nigeria’s Debt To Hit Record N53trn As FG plans Fresh N11trn Borrowing (The Whistler Nigeria)
If the proposal by the Minister of Finance, Mrs Zaianb Ahmed to the Federal Government to borrow the sum of N11.3trn to finance the 2023 budget, then the total loan portfolio under the administration of President Muhammadu Buhari would hit a record N53trn. The Minister had told federal lawmakers that the Federal Government projects to borrow about N11.3trn and privatize some of its holdings in national enterprises to finance the budget deficit in 2023. She had told them the 2023 budget deficit is expected to exceed N12.42trn if it should keep petroleum subsidy for the entire 2023 fiscal year.
Data from the Debt Management Office showed that out of the $10.19bn proposed to be used for debt servicing, about $6.95bn representing 68.2 per cent would be spent to service the commercial portion of the external debt burden while the balance of $3.24bn or 31.79 per cent is being projected for payment of interest for multilateral debt obligation.
India, Nigeria Increase Investment In ICT, Others (The Tide)
Nigeria and India have strengthened collaboration in Information and Communications Technology (ICT), green economy, artificial intelligence and entrepreneurship training as both countries boost their bilateral relations.
“We have in areas of business a very solid and growing relations. India is one of the largest investors in Nigeria and of course India is one of the largest markets for Nigerian crude.
“In Information Technology, India is the leader. So, we really feel that we can benefit enormously now in the relationship that we are building going forward,” Onyeama said.
“Today we have the opportunity to discuss on various bilateral aspects, including the trade, consular issues, the education and all these issues”, he said. He continued that the newly established NIBC will be a milestone in the improvement of the bilateral trade, investment in various sector, noting that India is ready to provide soft credit to Nigeria for to build solar power plants.
Nigeria displaces South Africa as Korea’s biggest African trade partner (The Guardian Nigeria)
Nigeria has displaced South Africa as the major trading partner of the Republic of Korea on the African continent, Director, Korea-Africa Foundation, Lyeo Woon-ki has said. Lyeo, who disclosed this in Abuja at a media parley, explained that trade between Nigeria and Korea was two billion dollars in 2021 but that the present figures indicate that the trade volume for 2022 has reached over $1.5 billion as of June this year which surpasses the trade volume between Korea and South Africa.
“The trade volume between Nigeria and Korea is bigger than between Korea and South Africa. In 2021, the figure was around $2 billion and by the half of this year, the figure has gone beyond $1.5 billion. All of these happened despite the COVID-19 pandemic and limited trading. We are sure it will be about two billion dollars by the end of the current year. The balance of trade between both countries is almost equal,” he stated. He added that the Korea-Africa Foundation was established to foster business and cultural cooperation between Korea and the continent.
Liberia Can Hit Billions in Revenue Says LRA CG-Designate (Global News Network)
Liberia Revenue Authority (LRA) Commissioner General-designate Thomas Doe Nah Monday faced Senate’s confirmation hearing for a second term and expressed the possibility of taking the country’s annual revenue collection to a billion United States dollars or more. At his confirmation hearing, CG Nah stated the LRA remains committed to surpassing last year’s collection of US$579 Million.
With the 2022 revenue target at 809 million, Mr. Nah assured the Senate’s Committee on Ways, Means, and Finance that Liberia can reach the billion-dollar target or more in revenue in the next few years with their full support. The Commissioner General designate noted, “Liberia is a country, and we deserve to be dividing a billion dollars and not 500 million” to foster national developments that will improve the people and the country’s welfare.
The LRA CG designate told the Senate that with the help of his dedicated employees, he has successfully steered the affairs of the LRA, stabilizing it through innovation and technology, despite global economic meltdowns worsened by the Covid 19 pandemic. The LRA has since digitized tax payment through several means, including mobile money transfer, direct bank transfer, electronic filing, among others, to boost revenue collection in what he called ‘changing the digital ecosystem of tax collection.’
Gambia pays D1.6M commitment to WTO (The Point)
Dwelling on the benefits gained by the country as a member of WTO, PS Dampha explained that WTO provides lots of training to his ministry, saying one of their staff is currently at WTO for a 10-month internship. “Every four years we normally do a trade policy review and WTO provides that support. If we have a trade dispute with any of the countries, we can address it to the level of WTO because it is rule-based that facilitates a multilateral trading system.” As regards the government’s commitment to implement WTO’s commitments per the rules, he said “The Gambia is currently implementing all WTO’s commitments and the trade ministry annually provides them with regular notification reports.”
African trade and integration
EAC-COMESA-SADC Tripartite Not Ratified 7 Years On (East African Business Week)
The East African Community, Common Market for Eastern and Southern Africa and the Southern Africa Development Cooperation Tripartite Free Trade Area agreement has not been put into force despite member countries signing it 7 years ago. According to a document seen by EABW NEWS, the delay in ratification is due to a slow response from member countries that have not yet signed the ratification treaty. “Most of the remaining countries indicate the process to ratify is still in progress. “So, the process is on course but the pace is slow,” said Mwangi Gakunga the COMESA Communications Manager.
The EAC-COMESA-SADC Tripartite Free Trade Area agreement has a total of 29 member countries representing 53% of the African Union membership and more than 60% of the Africa Continent GDP ($1.88 Trillion) with a population of over 800 million people. In 2015, 22 of the 29 member countries signed in acceptance of the treaty but only 11 have ratified it. “For the agreement to go into full force or be implemented, at least 14 member countries have to ratify,” added Gakunga. The 11 member countries that have ratified are Egypt, Eswatini, South Africa, Rwanda, Burundi, Uganda, Botswana, Namibia, Zambia, Kenya and Zimbabwe.
President unveils new-look Beitbridge Border Post (The Herald)
President Mnangagwa yesterday commissioned the modernised Beitbridge Border Post and said all border posts would be upgraded to improve the quality of services in the transport sub-sector. He directed Transport and Infrastructural Development Minister Felix Mhona to ensure the speedy upgrading of the Beitbridge-Bulawayo-Victoria Falls highway.
In his address, President Mnangagwa said the upgrading and modernisation of the Beitbridge Border Post was “a key milestone in the operationalisation of the Integrated Beitbridge Development Master Plan and stands out as one of the signature infrastructure projects being implemented, to date, by the Second Republic. “In line with international trends, and to further improve the quality of our services in the transport sub-sector, my Government will accelerate the upgrade and modernisation of other border posts, including Chirundu, Forbes, Plumtree, Nyamapanda, Kazungula, and Victoria Falls.
“We are also aware that the development of these border posts must be augmented by other complementing infrastructure for the efficient transportation of goods, movement of people and provision of services.
President Mnangagwa said the scope of works undertaken at the Beitbridge Border Post, “will undoubtedly see this port of entry facilitate the smooth discharge of the statutory functions of various stakeholders, as well as result in a seamless link of our economy with other jurisdictions along the North-South Corridor.
Abuse of STR Policy Limiting Cross Border Trade - Findings (KT Press)
The East African Community (EAC) regional economic community officials have called on women to report cases of abuse, harassment and corruption encountered during the implementation of the regional Simplified Trade Regime (STR). The call comes after new evidence shows slow uptake of implementing the STR policy which was put in place to ease doing business for women and youth who are the largest number of cross border traders
The Common Market for Eastern and Southern Africa (COMESA) launched the STR in 2010 to simplify and streamline the documentation and procedures for the clearance of small cross border traders’ consignments, while enabling them to benefit from the COMESA preferential tariffs trading environment.
The STR is a special provision aimed specifically at small traders who regularly transact in low value consignments and an approved simplified certificate of origin (SCOO) exempts consignments of goods that originate in the EAC and are valued at under US$ 2,000 from payment of import duty in any EAC destination country. However, reports indicate that most traders lack sufficient knowledge about the rights provided under the protocols and how these provisions are applied, the obligatory customs procedures and documentation.
The 2022 findings by the East African Legislative Assembly (EALA), Committee on Communication, Trade and Investment show that cross border businesses are affected by non tariff barriers The findings show that small traders, 80% of them women and youth, face a number of difficulties such as harassment, corruption, including bribery, excessive charges, impounding of goods and difficulties in obtaining passports and visas.
Southern African countries can do better at infrastructure: what the choices might look like (The Conversation)
Countries in southern Africa are under a crushing burden brought about by a confluence of factors. These include the unprecedented growth in the number of young people, the remarkable speed of urbanisation and the rise of informal settlements in urban centres. The physical infrastructure needed to meet these challenges requires exceptional solutions. But these call for alternative approaches. These include deep collaboration between member states and the private sector. And the development of a robust relationship between economic and social infrastructure, on the one hand, and the underlying policy framework that drives decisions on the other.
Infrastructure projects take a long time to come to fruition - often in the order of one or two decades. This introduces a whole range of uncertainties. To better navigate uncertainty, upheaval and inevitable change decision makers should employ strategic foresight. It’s an approach that helps the development of alternative futures and options that better anticipate and prepare for new opportunities and challenges. Strategic foresight spurs new thinking about the best policies to address long term opportunities and challenges through proactive and adaptive policy innovation.
Best practice sharing set to improve land governance in EAC countries (Business Daily)
The East African Community (EAC) partner states have begun to share lessons and best practices in land policy development. This is being done within the realm of Article 15 of the EAC Market Protocol which provides that access to, and use of land and premises, shall be governed by national policies and laws of individual partner states.
The states are currently at different levels of land policy development. For instance, while South Sudan is yet to complete the formulation of its land policy, Rwanda reviewed its 2004 land policy in 2019, and moved on to the second implementation phase.
Improvement in land governance within the region is expected to make significant contribution to the realisation of some of the regional co-operation areas. These include agriculture and food security, tourism and wildlife, infrastructure, and also environment and natural resources management.
How multinational tobacco companies aid Illicit financial flows in Nigeria, others – Report (The Guardian Nigeria)
Tobacco multinationals in Nigeria and other African Countries are contributing significantly to illicit financial flows in the continent mainly through tax avoidance and evasion, a new report said. The report titled ‘Tobacco Industry and Illicit Financial Flows in Africa” was conducted by the Civil Society Legislative Advocacy Centre (CISLAC) in collaboration with Tax Justice Network Africa (TJNA) with a focus on documenting the extent of the tobacco industry’s involvement in tax avoidance and evasion in Africa.
Quoting a 2020 data from the United Nations Conference on Trade and Development’s Economic Development that Africa is now losing over $88.6 billion to IFFs, executive director of CISLAC, Auwal Rafsanjani said the illegal acts is mainly perpetrated by multinational companies. He said: “We have to show the world the negative effects and manner in which tobacco companies are destroying the health of Africans, and at same time, promote corruption in the continent. Over the years, tobacco have done a lot of harm to the health and wellbeing of Nigerians and Africans. In abroad, especially in the Western world, the tobacco consumption is reducing but in Africa the consumption rate is increasing. When we look at the major diseases that are killing people across the globe, particularly in Africa, tobacco is at the forefront.
He said the Civil Society Organisations are working with ECOWAS to highlight and show the danger and the risks for the continuation of allowing the tobacco companies to have their way. “So we suggest to governments in Africa that they need to increase the taxes for tobacco consumption, and tobacco multinational corporation. Because what they are doing in their country is not what they’re doing here Africa. In their country, they follow the rules and regulations but in Africa, those rules or regulations that guarantee the safety of the people are not even there”
“Tobacco money is made in Africa, money goes elsewhere to shareholders outside the continent. That is more reason higher taxes would benefit the host countries. We however risk having smokers spend more money on smoking than say education or food as price of cigarettes and other tobacco products go up”, he stated.
Group: Africa Losing $88.6bn to Illicit Financial Flow Annually (This Day)
Boosting intra-African trade will power post-COVID-19 recovery and foster food security (Daily Trust)
The COVID-19 pandemic is disrupting Africa’s development trajectory. It is exacting a substantial socio-economic toll and putting the survival of half of the continent’s micro, small and medium-sized enterprises (MSMEs) at risk. Four in five African businesses are witnessing a dramatic reduction in sales. As African countries restart their economies and phase out COVID-19 restrictions, the ripple effects of the Ukraine crisis increase daily. The effects are particularly acute in terms of food security, given the continent’s reliance on food imports from the region of conflict. In addition, the rising cost of fertilisers and the impact of climate change are exacerbating food shortages. These shocks have slowed progress towards achieving SDG2, which is zero hunger by 2030.
Due to the current harsh economic realities in countries, the International Monetary Fund is encouraging governments worldwide to subsidize the cost of food and energy for their poor. Such a social intervention presents a huge fiscal challenge for many African countries.
An effective solution is to boost intra-African trade, which has the potential to pave the way to food security. Africa has enough food to ensure its citizens do not face hunger; however, the challenge is how to ensure that trade contributes significantly to food security.
Didiza: Africa must improve on-farm productivity (Food for Mzansi)
Skyrocketing food prices and supply chain disruptions are cutting deeper than the early days of the Covid-19 pandemic. And if Africa wants to get back onto a path of sustainable development, it will need survival plans to overcome stressors and shocks to people’s lives and livelihoods. This was the message shared by agriculture, land reform and rural development minister Thoko Didiza during a regional policy dialogue with key stakeholders in the Southern African Development Community (SADC).
Addressing the audience, Didiza said that, at the start of the pandemic, many people were worried that the African continent would face increased food insecurity, particularly as a net importer of agricultural and food products.
Africa has an abundance of land and workforce to change its agricultural fortunes, Didiza said. She warned, however that it would not happen automatically. “We have to increase investment and spending in research and development, infrastructure, and improving land governance on the continent to support private-sector investments.” The continent needs to focus on improving agricultural productivity so that it doesn’t need disproportionately large areas for food production, the minister said.
Farming summit: Kijaji wants Tanzania to feed Africa, world (The Citizen)
The minister for Investment, Industry and Trade, Dr Ashatu Kijaji, has challenged public and private sectors to make efforts towards making Tanzania the centre of Africa and the world when it comes to food trade. She made the challenge ahead of an agriculture forum. The five-day African Green Revolution Forum (AGRF) is slated to start next Monday in Kigali, Rwanda, where President Samia Suluhu Hassan is scheduled to be a keynote speaker.
Addressing the Tanzania Agribusiness Investment Summit 2022 in Dar es Salaam yesterday, , Dr Kijaji said Tanzania’s vision was to be a global food supplier and the market leader in agro-industrialisation in Africa. She said the achievement would be realised with the public and private sectors working together to benefit smallholder farmers.
The Summit also involved Tanzania business pitching at The African Agribusiness Dealroom a year-round matchmaking platform at the African Green Revolution Forum (AGRF), which brings together capital seekers and providers.
2022 Africa Climate Week: Experts discuss Africa’s needs and priorities ahead of COP27 (AfDB)
Amid a call for urgent action to safeguard the continent from climate change, Gabon’s President Ali Bongo Ondimba opened the 2022 Africa Climate Week by highlighting his country’s efforts to boost climate action and calling for continuous collective efforts. Africa Climate Week is taking place under the United Nations Framework Convention on Climate Change and is a crucial step on the road to COP27, which will be held in Egypt in November 2022.
In her address, Patricia Janet Scotland, secretary-general of the Commonwealth of Nations, said: “If we choose, we can be the solution we need, Africa can be the answer. And this is our time. We are the first generation to suffer the consequences of climate change but we are the last generation able to do anything about it.” Egyptian Foreign minister, Sameh Shoukry, the designated president of COP27, said that Africans should work to secure climate, given the disproportionate impact climate change is projected to have on Africa as compared to other regions. He said: “African governments and all other African voices, be they civil society, youth, women’s groups, farmers, workers, academia and the thriving African private sector, should all continue to call for climate justice.”
The African Union’s Commissioner for Rural Economy and Agriculture Josefa Sacko, urged African countries to maintain a common stance as the continent tackles the impacts of climate change to achieve its long-term goals.
Africa Should Trade its Carbon Credits to Fund Renewable Energy – UNECA (Inter Press Service)
Africa needs to trade in carbon credits to reduce greenhouse gas emissions, finance the transition to renewable energy, and boost economic development, the United Nations Economic Commission for Africa (UNECA) says. Carbon credits present an opportunity for African countries – many dependent on fossil fuels for energy – to protect themselves against climate change while raising much-needed finance for the transition to renewable energy transition, said Jean-Paul Adam, Director for Technology, Climate Change and Natural Resources Management Division at UNECA.
Carbon credits are globally traded commodities or permits that allow the emission of one tonne of CO2 or one tonne of carbon dioxide equivalent gases to be traded on national or international carbon markets. These credits, which can be used to boost economic growth and attract financing for various projects, are traded on the carbon offset markets. By selling carbon credits, African countries can also tackle climate change by protecting their forests which absorb and store a measured amount of carbon. Besides, the carbon credits can also be sold as ‘offsets’ to companies unable to cut pollution to reduce emissions elsewhere. Lack of finance and capacity to trade on the global carbon markets are hurdles for African countries have to overcome in the growing global carbon markets, where the carbon pricing revenue increased by almost 60 percent last year to about $84 billion, according to the World Bank.
China’s scramble for Africa’s rare earth elements (Observer Research Foundation)
With countries around the world pledging to zero-emission goals, the global demand for rare earth minerals has amplified. Rare earths comprise of 17 minerals that are indispensable to the manufacturing of smartphones, electric vehicles, military weapons systems, and countless other advanced technologies. Africa holds the promise of large, high-grade deposits of rare earth metals. For three decades, China has managed to secure mining deals across the African continent with the availability of cheap labour and weak regulations. Currently, the global annual demand for rare earth elements (REEs) is largely met by China, which has devoted itself to increasing its presence in Africa guaranteeing ambitious energy and technological transitions. However, even with the abundant availability of rare earth deposits in southern and eastern African countries, the region has not yet reached its full potential.
Towards the end of 2010, the hunt for rare earths hit a high point as China, Japan, and South Korea showed keenness in acquiring these elements, with China raising trade-related disputes and controlling exports of rare earths and other metals. After the mining companies started realising the supply shortage, several new ventures were launched around the world, especially in Africa as the continent presented a perfect opportunity for these companies given the uncertainties in the field.
TICAD8 Highlights Value of “Human Security” in Africa (IISD)
The Eighth Tokyo International Conference on African Development (TICAD8) highlighted the importance of achieving “human security” in Africa by realizing structural transformation for sustainable economic growth and social development, a resilient and sustainable society, and sustainable peace and stability. The conference convened in Tunis, Tunisia, from 27-28 August 2022, at the level of Heads of State and Government.
Its outcome document, ‘TICAD8 Tunis Declaration,’ highlights the importance of investing in people to promote human security, which “will enhance the significant potential of Africa as a driving force of global growth.” The declaration underscores the need to address the COVID-19 pandemic and the ongoing socio-political and environmental crises by advancing action under three pillars: Realizing structural transformation for sustainable economic growth and social development, including by: promoting private sector investment in Africa; public-private partnerships (PPPs) like the Japan Business Council for Africa and the Japan-Africa Infrastructure Development Association; addressing Africa’s climate vulnerabilities; supporting Africa’s economic resilience; and attracting sound development finance; Realizing a resilient and sustainable society, to be characterized by human security and achievement of the African Union’s (AU) Agenda 2063 and the SDGs; and Realizing sustainable peace and stability, by, among other actions, promoting good governance, democracy, and the rule of law.
pdf TICAD 8: Tunis Declaration - 28 August 2022 (270 KB)
Great Expectations (The Foreign Service Journal)
The promised U.S.-Africa Leaders Summit, scheduled for Dec. 13-15 this year, will be the first head of state gathering of African leaders and a U.S. president since 2014, and marks only the second time Washington has accorded this level of attention to a partnership dialogue with the region. Though the United States has an annual trade forum through the African Growth and Opportunity Act, convening trade ministers and a number of bilateral strategic dialogues with key country partners at the foreign minister level, these gatherings don’t confer presidential-level priority.
The hope now is that the summit will usher in more consistent head-of-state engagement, treat Africa as a strategic priority for the United States and give a dynamic boost to mutually beneficial U.S. engagement on the continent.
Prior to the COVID-19 global pandemic, Africa was home to six of the 10 fastest-growing economies in the world. The United States has a growing two-way trade relationship with the continent that exceeded $64 billion in 2021, but this only represents 1 percent of U.S. trade, and there is plenty of room to grow America’s economic partnership with Africa as the continent continues to grow and attract global trade and investment. The continent that gave rise to mobile money and digital payments set record highs in 2021 for venture capital (VC) investments in its fintech sector, according to Partech’s 2021 Africa Tech Venture Capital Report. That report showed that African VC investments tripled from the prior year, grew faster than any other region and are growing three times faster than global VC investment. Africa also has an exciting new trade bloc, the African Continental Free Trade Area (AfCFTA), that unites the continent into a single giant market and promises to reduce red tape, harmonize the regulatory burden, and significantly diminish tariffs and customs procedures.
This ambitious project, which entered into force in May 2019, is in its first phase of implementation, with negotiations underway to set the terms for trade in goods and services, and second-phase talks also in progress to address investment, intellectual property rights and competition policy, among other things. The third phase will include the digital economy and a special protocol on women and youth. As of the Tralac Law Centre’s May 2022 status update, no trade had yet taken place under the AfCFTA regime, but there is significant interest in supporting its successful implementation.
New boost for Arab-Africa trade? (African Business)
While there has always been a strong desire to boost Arab-Africa trade, the rhetoric has largely failed to match the delivery. Arab-Africa trade has been static at 17% of the continent’s total trade for the last seven years, with China and the EU by far its two largest trading partners. Continental trade with its Arab neighbours according to Afreximbank is estimated at a mere $80bn in 2021. But the signs are that the trade and investment winds of change are blowing over the continent from the north-eastern enclave of Arab countries centred around Egypt, the new gateway to sub-Saharan Africa (SSA).
In an interview, Oramah candidly laid out the scale of Africa’s financing needs and the potential role of Arab financial muscle in reducing this gap. “Africa’s trade finance gap remains significantly high at over $90bn,” he said, “and the participation rates of African banks in the trade finance space have been declining at a fast pace. “The trade insurance and guarantee markets remain underdeveloped to provide the kinds of protections that traders and commercial banks would require to provide financing for cross-border trade. Africa is not adequately supplied as financial institutions are not able to meet the increasing opportunities that abound because of not having sufficient capital.”
The game changer could be the landmark multi-billion-dollar Arab-Africa Guarantee Fund (AAGF) approved by the AATB Board in March, which is due to start operations in 2023.
Global economy
The first-ever AfriCaribbean Trade and Investment Forum (ACTIF2022), being held at the Lloyd Erskine Sandiford Centre in Bridgetown, Barbados, from 1 to 3 September
The theme for ACTIF2022 is ‘One People, One Destiny: Uniting and Reimagining Our Future’. Presentations and panel sessions will address key topics around deepening the trade and investment linkages between Africa and the Caribbean. These include accelerating industrialisation and manufacturing in Special Economic Zones and Industrial Parks; financing trade and investments; opportunities across the cultural and creative industries; leveraging the power of the African Continental Free Trade Area; improving logistics to promote tourism, trade and telecommunications; improving agricultural productivity, agribusiness and food security; healthcare and life sciences; accelerating private sector trade and investment; creating opportunities for youth and SMEs; and building Africa-Caribbean value chains.
ACTIF2022 has been structured to provide an important opportunity for the Caribbean and African business communities to establish new commercial and strategic relationships to expand trade between the two regions and to source necessary inputs for the design and manufacture of high-value products. It will also enhance Government-Business relationships between Africa and the Caribbean and increase inter-regional trade and investment leads through effective business matchmaking.
Brics reserve currency (Observer Research Foundation)
Whilst Russia and China are leading de-dollarisation initiatives due to their geopolitical rivalry with the US, India, Brazil, and South Africa have supported BRICS’ statements on altering the global financial system for their own interests. In his recent address to the BRICS Business Forum, Russian President Vladimir Putin stated that the minilateral member states were working on developing a new global reserve currency. It is presumed that this global reserve currency, containing the national currencies of the BRICS member states, will be an alternative to the International Monetary Fund’s Special Drawing Right (SDR). At a time when Russia is facing unprecedented global sanctions in the wake of the Ukraine invasion, Putin’s announcement has underscored the importance of recognising the heterogeneous motives of the BRICS nations to not only facilitate intra-BRICS trade in local currencies, but also firewall their global financial interests.
China committed to wider opening-up in services trade, promoting global economic recovery (China.org.cn)
As the 2022 China International Fair for Trade in Services (CIFTIS) kicked off Wednesday in Beijing, the country has shown the world its unwavering commitment to wider opening-up in the services trade sector and a firm determination to further promote global economic recovery. Themed "Cooperate for Better Development, Innovate for a Greener Future," the 2022 CIFTIS includes a global services trade summit, exhibitions, forums, new product and technology releases, business promotions and discussions, and supporting activities.
While delivering a keynote speech at the Summit of 2022 CIFTIS Wednesday, Chinese Vice Premier Han Zheng called for efforts to promote the healthy and sustainable development of services trade to make a greater contribution to the recovery of the global economy.
Related News
tralac Daily News
Local news
Trade Statistics for July 2022 | South African Revenue Service
The South African Revenue Service (SARS) today releases trade statistics for July 2022 recording a preliminary trade balance surplus of R24.76 billion. These statistics include trade data with Botswana, Eswatini, Lesotho and Namibia (BELN). The year-to-date (01 January to 31 July 2022) preliminary trade balance surplus of R156.71 billion is a deterioration from the R285.13 billion trade balance surplus for the comparable period in 2021. Exports increased by 24.3% year-on-year whilst imports increased by 41.6% over the same period.
South Africans look abroad as supply chain challenges increase (Engineering News)
Local container shipments for export declined by 17.5% year-on-year during the second quarter of the year as port activity was impacted by international supply chain disruptions, load-shedding and flooding in KwaZulu-Natal, PwC South Africa’s ‘South Africa Economic Outlook’ report for 2022 states. In the eighth edition of the ‘South Africa Economic Outlook’, the firm focused on local companies finding growth opportunities abroad, ranging from exports to direct investment deals.
‘Unfair’ trade bans threaten agriculture jobs in South Africa (Farmer’s Weekly SA)
The lack of action taken to have agricultural import bans imposed by Botswana, and more recently Namibia, lifted is creating a feeling among South African fresh produce farmers that government has failed them. The bans included South African exports of tomatoes, potatoes, beetroot, cabbages and peppers, among other commodities. Christo van der Rheede, executive director of Agri SA, told Farmer’s Weekly that these bans did not stem from any wrongdoing on the part of South African farmers, but rather because these countries wanted to “protect their own local production”, even as they continued to export their produce to South Africa.
As such, the trade bans were in direct violation of the Southern Africa Customs Union Agreement, aimed at facilitating free trade among countries in the region.
SMME export development and promotion support part of industrialisation, competitiveness - DTIC (Engineering News)
The Department of Trade, Industry and Competition (DTIC) provides support to small, medium-sized and microenterprises (SMMEs) in terms of export readiness, export development and export promotion as part of efforts to drive industrialisation, development and competitiveness. The DTIC hosted a webinar on August 30 to brief SMMEs about the support the department provides and the benefits available to companies developing exports, including improving the resilience of enterprises, supporting diversification of markets and products and building competitiveness.
“We have accepted that trade is an important engine of economic growth and development. We are mindful that many regions in the world have been able to lift many people out of poverty through the development of trade and exporting,” said DTIC export development, promotion and outward investments deputy director-general Lerato Mataboge. “In driving industrialisation, it is clear that an exporting economy and export-led growth are needed. Trade and exporting generate jobs and income opportunities, and help to build competitiveness in participating enterprises that have to compete on a global stage,” she said.
Warning over meat prices in South Africa (BusinessTech)
The Bureau for Food and Agricultural Policy (BFAP) has published its food inflation brief for July 2022, highlighting the food items that have recorded the biggest price hikes in South Africa. While food price inflation outstripped headline inflation again in July, the group said that it expects price increases to slow towards the end of the year. However, if measures put in place to curb foot and mouth disease in cattle are extended, meat prices could shoot up, it said.
Modern technology key to boosting Kenya’s tea output: experts (Xinhua)
Kenyan tea farmers and traders should embrace modern technology to boost production, African experts said Monday. Ebrima Sall, the executive director of Trust Africa, said that all stakeholders stand to reap maximum profit from the cash crop once modern technologies are adopted. “It has reached the time that old machinery that has been used for centuries be abandoned to help stakeholders improve efficiency in tea production and be able to supply the market in good time,” Sall said at a forum in Nairobi, the Kenyan capital.
Sall noted that with the adverse effects of climate change, players in the tea value chain must embrace sustainable agricultural systems. He called upon key stakeholders to borrow and implement good practices that have been adopted by tea producers in the Asian continent.
‘Strong agro processing base critical in transforming Africa’ (Chronicle)
INDUSTRY and Commerce Minister, Dr Sekai Nzenza, has said the African Continental Free Trade Area (AfCFTA) presents huge opportunities for the agro-industrial sector and called on it to ramp up output for that market. In a virtual address on Friday during a United Nations Industrial Development Organisation (UNIDO) Forum on Building Resilient and Sustainable Agro-Industries to enhance Africa’s growth potential, the minister said a strong regional agriculture processing base was critical in transforming the continent. She said Zimbabwe, guided by the National Development Strategy (NDS1), was already forging ahead in building a resilient economy by prioritising value chain development with agriculture given critical focus.
The sector is the mainstay of the country’s economy and provides up to 60 percent of raw materials for the manufacturing sector. In 2021, the agricultural sector contributed 17 percent to the gross domestic product (GDP) and the Government expects the growth of the sector to aid import substitution.
Insecurity, congestion, dredging, others listed as challenges to port investments (The Guardian Nigeria)
Insecurity, infrastructural deficiency, dredging, and congestion have been listed as factors halting seaport investments in Nigeria. This was disclosed in a statement by Welcome2Africa International (W2AI) on the Nigeria Seaports Investment Forum (NSIF2022), which would be held in Lagos on September 28 – 29. In an effort to improve Nigeria’s global trading ecosystem, W2AI, in partnership with Zenith Carex International Limited in the summit, themed “Repositioning Nigeria’s Seaports for Investment and Trade Attractiveness”, would address major bottlenecks like congestion, technological advancement, infrastructural deficiency, dredging, port equipment, security, logistics, and training that represent opportunities for investors at the seaports.
It would also address issues on policy, investment, international trade with Europe, and the African Continental Free Trade Agreement (AfCFTA).
‘Local manufacturing still dominated by food, beverages sector’ (The Guardian Nigeria)
Worried by the dominance of a segment of the productive sector in the economy, the Manufacturers Association of Nigeria (MAN) has emphasised the need for government intervention in other critical subsectors to diversify the country’s manufacturing base. Indeed, the President of the Manufacturers Association of Nigeria (MAN), Mansur Ahmed, while speaking at a forum for the media, charged the government to adopt necessary measures to diversify the manufacturing sector.
Ahmed explained that while the Federal Government was taking measures to diversify the economic base of the country, using the proceeds from oil and gas, additional efforts should also be made to focus on the manufacturing sector to produce what is needed.
“As the government is diversifying from oil and gas to agriculture, the manufacturing sector needs to diversify to produce goods that are required. The government must look at the entire sectors of the economy and also encourage new investments. There is no doubt that the Nigerian manufacturing sector is not producing enough even though we are in a position to do so. Our manufacturing is not positioned to produce for export hence the need for encouragement. So, while we are thinking about diversification, we must do it horizontally and vertically.
“As we go into the Africa Continental Free Trade Area Agreement, it is an opportunity for Nigeria because when you go around Africa as a whole, apart from South Africa, maybe Egypt and Morocco, there is a lack of capacity. Therefore, we need to build the capacity of our manufacturing sector to produce more and improve the quality of our products.”
The Botswana-South Africa freight rail link to be revamped in 24 months (Construction Review)
The Botswana-South Africa freight rail link is to be rehabilitated in the next 24 months in order to enable landlocked Botswana to transport mineral resources to the Ports of Richards Bay and Durban. The 126 kilometer Botswana-South Africa freight rail link rehabilitation project will be carried out by the rail companies of South Africa and Botswana, Transnet Freight Rail and Botswana Rail.
Minister of Transport and Communications, Dorcas Makgato confirmed the reports and said the project is aimed at linking coal deposits in both areas with South African heavy haul lines and also become a gateway to South African ports for the coal market and link Botswana’s mines to the Transnet Freight Rail network. “In order to unlock regional growth, a corridor approach is a must. The proposed link between Mmamabula in Botswana and Lephalale in South Africa would stimulate the economies of Botswana and South Africa,” said Dorcas Makgato.
Nigeria’s N20.4 trillion imports in 2021 not enough to lift economy – Economists (Nairametrics)
Despite the hues and cries about Nigeria being an import-dependent economy over the years, and importing goods worth over N20 trillion last year alone, economists say that Nigeria is importing too little compared to its African and Asian peers. Nigeria’s imports were worth N20.84 trillion in 2021, representing an increase of 64% compared to N12.7 trillion recorded in the preceding year, with Nigeria’s Petrol exports being the largest at N3.97 trillion, followed by Durum wheat – N1.29 trillion and used vehicles – N770.13 billion. But imports make up less than 10% of GDP, and Nigeria’s largest import being refined Petroleum (which should reduce significantly once the Dangote Refineries and Port Harcourt refinery renovation come onboard).
According to Wale Smit, Nairametrics Columnist and Financial Analyst, “Nigeria’s import relative to the size of the economy is not large, relative to our export earnings which we need to finance those imports is not enough.” Olumide Adesina, Financial Market analyst at Quantum Economics said, “The major challenge is that the biggest economy in Africa lacks significant purchasing power for large imports and production potential to increase exports.
Privatisation is not a single process: Egypt’s pursuit of a bigger role for the private sector (Ahram Online)
While it is evident that the recent government and central bank reshuffle will lead to profound changes in the economy and in government policies, it would be premature to commit to their sound and effective implementation. Egypt has never been short of plans and strategies, but they have often ended up hitting the wall of implementation.
The state has set specific objectives and clear indicators for the next three years and is hastening to implement them. These goals include doubling the role of the productive activities of the private sector, planning for a boom in exports to reach $100 billion a year by 2025, and increasing foreign direct investment (FDI) to $40 billion. These three objectives, closely interrelated, require a series of difficult and interdependent measures that will represent challenges to their achievement.
Amid Energy Crisis, EU Plans To Help Gas-Rich Mozambique Boost Security (carandbike)
The European Union is planning a five-fold increase in financial support to an African military mission in Mozambique, an internal EU document shows, as Islamist attacks threaten gas projects meant to reduce the EU’s reliance on Russian energy. The energy squeeze due to the Ukraine war has added impetus to Europe’s scramble for gas off Mozambique’s northern coast, where Western oil firms are planning to build a massive liquefied natural gas (LNG) terminal.
Mozambique has been grappling with militants linked to the Islamic State in its northernmost gas-rich province of Cabo Delgado since 2017, near LNG projects worth billions of dollars.
A southern African military mission and a separate intervention by troops from Rwanda have between them managed to contain the militants’ spread since being deployed last year. But “the situation remains very volatile and smaller-scale violent attacks have continued in various districts,” the EU document dated Aug. 10 said.
The paper prepared by the European External Action Service (EEAS), the EU’s de facto foreign ministry, recommends 15 million euros ($15.3 million) of EU funding to 2024 for the mission of the Southern African Development Community’s (SADC), a bloc of 16 African nations of which half a dozen sent troops to Mozambique.
African trade and integration
Experts Believe ETCs Will Make African Trade Competitive (News Ghana)
Export Trading Companies (ETCs), when established in Africa, are expected to assist in ameliorating the varied issues that make exports from this region uncompetitive. Speaking on Eye on Port, some trade experts believe the establishment of ETCs will provide solutions to major supply chain issues that make trade expensive. “ETCs will be expected to focus on the export of diverse, non-traditional value added goods and services to many markets. ETCs engage in other ancillary functions, warehousing, local transportation, shipping, insurance and consciously engage SMEs and other suppliers in the production and manufacturing value chain. They will provide much needed support to these value chain producers in terms of production know-how, risk management and many more. Due to the fact that ETCs by design are large institutions, they will be able to leverage on economies of scale to reduce impact of high transactional cost thus increasing competitiveness,” Kayode Sufiano, an ETC Specialist and Organizational Strategist from Nigeria averred.
Dr. Olufemi Adebiyi, an SME Specialist and Organizational strategist, also from Nigeria stated that the domination of trade landscape by primary commodities and aggregate level of output remains why Africa’s contribution to global trade is low. He said the promotion of manufactured goods and stimulation of production will be the contribution of ETCs.
Key Highlights From The 9th Meeting Of The AfCFTA Council Of Ministers (Mondaq)
On 25th and 26th July 2022, the AfCFTA Council of Ministers met in Accra, Ghana for the 9th Meeting of the AfCFTA Council of Ministers responsible for trade. During this meeting, the AfCFTA Secretariat reported major strides towards making trade under the AfCFTA fully operational. The key highlights of the meeting included: The AfCFTA Rules of Origin Manual was drafted in accordance with Article 42 of Annex 2 of the Protocol on Trade in Goods; The AfCFTA e-Tariff Book was introduced as part of the AfCFTA Secretariat’s digitalisation and trade facilitation efforts; The AfCFTA Initiative on Guided Trade aims to gather countries among the 29 that have already submitted their tariff schedules to commence trading with the direction of the Secretariat.
Zero tariffs in near future - but forex shortages hobble trade in Africa (FreshPlaza)
Dr Mmatlou Kalaba’s IFPA Cape Town conference presentation on the as yet little-understood Africa-wide free trade system, drew much interest coming as it did in the same week that Botswana’s closure of its borders to South African vegetables (a practice also followed by fellow Southern African Customs Union member Namibia to protect its domestic industry) made national headlines.
The mostly South African delegates know the intra-African trading environment well, as one conference-goer and apple exporter shared during Dr Kalaba’s presentation. Apples will be amongst the top fresh produce from SA to benefit early or upon entry into force, Dr Kalaba said, because South Africa already has a presence in most markets on the continent, including those maintaining high tariffs.
“Our exports into Africa could have doubled but instead we’re decreasing our exposure in Africa due to currency: we cannot get access to enough Euros and US Dollars from central banks,” the exporter maintained. Dr Kalaba agreed on the difficulties of the different monetary systems on the continent, a matter on the mind of the AfCFTA Secretariat too, he noted.
DG Okonjo-Iweala — “enormous scope” for Africa to benefit from trade and investment (WTO)
Speaking at the 8th Tokyo International Conference on African Development (TICAD) in Tunis, DG Okonjo-Iweala noted that Africa is a large, growing and — thanks to the African Continental Free Trade Area (AfCFTA) — increasingly integrated market of 1.4 billion consumers and entrepreneurs. However, the COVID-19 pandemic has set Africa back several decades on poverty reduction, education, and job creation and brought back familiar problems related to debt distress, she said.
DG Okonjo-Iweala urged global solidarity with Africa in the form of financial support and debt restructuring but also by encouraging investment and improving trading conditions, including through free trade agreements and special and differential treatment.
Africa received its highest proportion of private sector investment in infrastructure in 2020, sending an important signal to governments and investors. African Development Bank Vice President for the Private Sector, Infrastructure and Industrialization, Solomon Quaynor, underlined this point during a webinar organized by the African Development Bank and the Japan International Cooperation Agency (JICA) on 24 August.
Quaynor said the greater private sector investment came as most African governments contended with the Covid-19 pandemic, limited fiscal space and high debt-to-GDP ratios. “Private sector investment into Africa’s infrastructure rose to $19 billion in 2020, representing 23%, the highest since 2016. This counter-cyclical role played by the private sector shows the importance of its growing role in infrastructure financing in Africa,” he said in remarks at the close of the webinar, themed Private Sector Infrastructure Development Opportunities in Africa.
Japan and AfDB team up to promote private sector (ICLG)
The Japanese government and African Development Bank have signed a USD 5 billion financial cooperation agreement to support Africa’s private sector. The agreement, announced on 28 August during the Eighth Tokyo International Conference on African Development (TICAD8) in Tunis, forms part of the fifth phase of the Enhanced Private Sector Assistance for Africa (EPSA) initiative, developed by Japan and the bank, between 2023 to 2025 (EPSA 5).
EPSA 5 will concentrate on the three areas of electricity, connectivity and health, further recognising the significance of food security by adding agriculture and nutrition as a fourth priority area for Africa.
The Conference of Heads of State during the 60th Summit held in December 2021 approved the ECOWAS Regional Infrastructure Master Plan. The Master plan is for the timeframe 2020-2045 and comprises 201 regional projects at an estimated cost of 131 billion USD.
Consequently, the ECOWAS Commission organized a sensitization workshop from 29th – 30th August, 2022 in Accra, Ghana to present the Master plan to the Ministries in charge of Transport from ECOWAS Member States as well as Development Partners such as ECOWAS Bank for Investment and Development and Spanish Co-operation for International Development (AECID) to reflect on resource mobilization, coordination and implementation of the Masterplan, in particular, in the transport sector.
5th Forum on China-Africa Media Cooperation successfully held in Beijing (KBC)
From August 25 to 26, 2022, the 5th Forum on China-Africa Media Cooperation was held in Beijing, China, in a combined online/offline mode. This year marks the 10 anniversary of the Forum on China-Africa Media Cooperation. In deep appreciation to look back upon the fruitful results, both sides have achieved over the past decade. Government departments of both sides have established regular effective communication channels to enhance understanding of each other’s policies and ideas.
The media on both sides have been upholding the spirit of friendly cooperation and working continuously to safeguard fairness and justice, telling stories about China-Africa cooperation in the new era and shouldering responsibilities to advance global development, promote common values of mankind and actively create an international public opinion atmosphere of cohesive development and cooperation.
Chinese and African media will also promote innovation convergence and deepen cooperation in areas of digital technology and digital economy to strengthen exchanges, share opportunities, and improve digital governance capabilities.
Global economy
China’s strengthening economy a good sign for global trade recovery (Xinhua)
China’s strengthening economic recovery is an important development as the world struggles to emerge from the economic hardships caused by rising prices, eroding food supplies, and uncertainty amid the Ukraine crisis, a leading Italian global business and management expert has said. The impact of China on the world’s economy is of the utmost importance and should absolutely not be underestimated, “especially for economies like those in Italy and Germany, which are major exporters,” he said, adding “it’s the same for Europe in general.” The latest news from China has been positive. The NBS said that China’s economy in July “sustained the momentum of recovery” despite the “increasingly complicated and challenging international environment as well as frequent and sporadic domestic outbreaks of Covid-19.”
From war and inflation to food and cargo charts chronicle volatile year (IMF Blog)
Background Note on Fossil Fuel Subsidy Reform (IISD)
As fossil fuel subsidies are expected to swell following rapidly rising energy prices, IISD offers a background note on the rationale and international initiatives for reforming fossil fuel subsidies. In addition to providing an overview of the environmental and trade effects of fossil fuel subsidies, it also examines international pledges and steps already taken by governments aiming to rationalize and reduce such support, including through the initiatives that take place through the G7, G20, Asia-Pacific Economic Cooperation, United Nations Framework Convention on Climate Change, and the new trade and environment initiatives at the World Trade Organization.
tralac Daily News
Local news
SA must ease market access barriers for optimal trade, says analyst (SAnews)
Until South Africa can find a way of easing market access barriers, the country will not reach the most optimal levels of trade. These are the sentiments of Khaya Sithole, a prominent accountant and economics commentator, speaking during a webinar on the impact of outbound trade shows on SMMES in South Africa. It was hosted by the Government Communication and Information System (GCIS) in collaboration with the Department of Trade, Industry and Competition on Tuesday. The country and the African continent still suffer from a “trade deficit”. “We simply do not do enough trade amongst ourselves. The consequence of [this] is that we are really not cultivating that dividend associated with the type of population sizes that we have,” he said.
Digital future of banking inevitable, imminent, report posits (Engineering News)
Two-thirds of South Africans expect the country’s banks to make a full transition to digital banking within five years, a new report titled ‘The Future of Retail Banking in South Africa’ states. The report was introduced at an event held in Sandton by Boston Consulting Group (BCG) in partnership with Discovery Bank. Key findings include that South African retail banking has the potential to become fully digital in just five years if banks provide easy-to-use, secure channels and make human assistance accessible when needed. Moreover, it notes that South Africans are further ahead of the technology curve than their banks.
State bets on shipping, logistics sector to drive regional growth (The Standard)
Kenya’s shipping, transport and logistics sectors have been cited as key catalysts that will help spur the economic fortunes of the East African Community (EAC). This is as the country positions itself to reap big from the entry of the Democratic Republic of Congo (DRC) into the regional economic bloc. The accelerated investment in the intermodal transport systems - majorly road, rail and port infrastructure affirms this strategy as Kenya eyes increased trade and commerce across the region.
Speaking at the Port of Mombasa, EAC Principal Secretary Kevit Desai, who met stakeholders from the shipping, manufacturing, transport, and logistics sectors for an engagement session, said efficiency and competitiveness of port facilities is crucial since they are the engine of the logistics and supply chain sector. The principal secretary anticipated increased demand for the services in the region as the population of the EAC crosses the 300 million mark following the entry of DRC into the trading bloc.
Mombasa firm tackles Kenya’s e-waste menace (Business Daily)
The increasing use of technology has seen thousands of information technology (IT) devices finding their way into Kenya, and with poor disposal, they put lives at risk and contribute to global warming. Though Kenya is a signatory to international treaties regulating and banning the dumping of damaged and end-of-life electronics, it still imports large quantities of these goods that are considered too inefficient to be sold in the country of origin.
After a few months of use, the devices become obsolete, and most users dispose of them at dumpsites without considering the dangers of the e-waste and the risks they will incur if information stored in the devices lands in the wrong hands. Launched in 2019 before Covid-19 struck, Close the Gap Group seeks to make use of e-waste and refurbish devices to create income for young people while conserving the environment.
Kenya generates an average of 3,000 tonnes of e-waste each year from devices such as computers, monitors, printers, mobile phones, fridges, and batteries, said Timothy Wachira, operations manager at the Circular Economy HUB in Jomvu, Mombasa.
First consignment of fresh Avocados from Kenya hits Chinese market (Capital News)
he first consignment of Fresh Avocados from Kenya has hit the Chinese market. Kenya’s Ambassador to China Muthoni Gichohi graced the official hand-over ceremony of the first batch of Kenya’s fresh avocado export to China which also marks the very first export of such avocados from Africa. The event took place in Beijing, China. The Ambassador applauded the efforts made by the two Governments towards this noble achievement.
She affirmed Kenya’s commitment to supporting the business communities in both countries as they look forward to enhancing trade facilitation as well as market access of their products and services to China.
“Kenya aims to export over 100,000 tonnes of avocados. The 1.4 billion population in China is a huge market for Kenya not only for avocados but also for other fresh produce such as mangoes and bananas,” said Dr. Wilfred Marube, Chief Executive Officer, Kenya Export Promotion and Branding Agency.
This journey kick-started in the year 2018 when China hosted the first vibrant China International Import Expo (CIIE) in Shanghai.
Tanzania economy to expand by 15trn/- in 2022, says FocusEconomics (IPP Media)
The SSA forecast report by the Spain based FocusEconomics shows the Tanzanian economy will also expand to 200trn/- ($81 billion) next year and 222.2trn/- ($87.6 billion) in 2024, with Nominal GDP annual variation (without inflation adjustment) of 13.0 percent and 11.1 percent respectively. The consensus report forecasts real GDP annual growth of 4.9 percent in 2021, 5.3 percent in 2022 and 5.6 percent in 2023.
FocusEconomics economist responsible for Tanzania Marta Casanovas said in a report unveiled to The Guardian yesterday that GDP growth is set to accelerate to one of the strongest rates in the region this year. “The government’s business-friendly stance is driving foreign investments, which will lead to large infrastructure projects, bolstering employment and spending,” she commented.
The economist said the recently approved International Monetary Fund (IMF) loan will also provide support the growth of the economy, which accounts 4.4 percent share of total SSA economy, the fifth largest.
The quarterly economic bulletin for the quarter ending June, published by Bank of Tanzania (BoT) yesterday shows the economy continued to experience spillover effects of high commodity prices in the world, as well as tight financial conditions and monetary policy by central banks in advanced economies.
“These global challenges have been caused by disruptions of global supply chain following the outbreak of war in Ukraine in February 2022,” BoT says. As a result, BoT says in the bulletin, there was an increase in the general price level in the quarter ending June 2022, pushing inflation rate to 4.5 percent in July this year.
Nigeria to develop strategy to boost e-commerce value chain (Voice of Nigeria)
The Nigerian government is currently working to establish a strategy on e-commerce that will boost the growth of the sector. The Nigerian Minister of Industry, Trade and Investment Mr Adeniyi Adebayo revealed this over the weekend in Abuja at a stakeholders dialogue on e-commerce and digital trade policy for Nigeria. The minister stated that there is no better time than now to diversify the Nigerian economy away from the oil sector by building a dynamic, profitable and efficient non-oil sector to reposition the economy on a sustainable growth path.
“Nigeria is yet to fully harness the inherent opportunities in the e-commerce value chain, largely due to inadequate investment, coupled with inadequate information on the opportunities in the sector and the inability of Government to provide the required enabling environment.” “As such, government has identified e-commerce as a major priority programme that will play a critical role in the promotion of commodity trade, especially with the realities of the unprecedented Covid-19 global pandemic,” he explained. “The Federal Government is also committed to developing an e-commerce strategy in line with the Federal Government’s Post COVID-19 recovery plan, to encourage investment in e-commerce value chain,” he said.
Africa’s Biggest Oil Producer Struggles Despite Price Bonanza (Bloomberg)
Nigeria’s economy expanded faster than expected in the second quarter, but its key oil sector is languishing despite booming prices. Output from Africa’s largest crude producer fell to 1.43 million barrels a day in the three months through June, the lowest quarterly production since 2016, according to the nation’s statistics agency. The fifth consecutive quarter of declining output comes as rampant theft and vandalism prevent Nigeria from fully benefiting from the oil bonanza that followed Russia’s invasion of Ukraine.
African trade and integration
AfCFTA Secretariat Unveils Required Tools And Instruments For Trade (News Ghana)
The AfCFTA secretariat has revealed that the continent of Africa is now ready to trade under the continental trading policy following the unveiling of the e-tariff book, rules of origin manual and the AfCFTA website on which all necessary information can be accessed to trade under AfCFTA. Speaking to the Single African Market Programme, the Principal Communications Advisor of the AfCFTA Secretariat and spokesperson to the Secretary General of the AfCFTA Secretariat, Ms. Grace Khoza said “ for the first time we’ve got a website that we ourselves are very proud of, it’s looking very sleek and clean but importantly it’s got the right information that as I indicated will empower each and every citizen on this continent who wants to access and know what we are doing as a secretariat.”
She explained that in addition to the AfCFTA website, tools and instruments such as the e-tariff book, the rules of origin manual and other documents that are intended to facilitate trading like the certificate of origin are all on the website.
Trade Law Centre Holds Masterclass For Senior And Experienced Trade Journalists In Africa On (News Ghana)
Speaking to the Single African Market, Executive Director of Trade Law Center (tralac) said in Line with its mission to build trade governance capacity in Africa, supporting trade and regional integration for just and sustainable development outcomes, at national, regional, continental, and multilateral levels, tralac’s first AfCFTA Masterclass for Selected Senior and experienced Trade Journalists across Africa will make a lot a difference in information sharing across the continent.
“This is the first masterclass for senior and experienced trade journalists across the continent, to have journalists who have been reporting on the AfCFTA consistently for quite some time for not only conversations about the AfCFTA and a catch up with the latest development and in particular the announcement by the council of Ministers at the latest meeting at the end of July on the start of facilitated and guided trade which we expect to begin before the end of September but also in using different media platforms opportunities and communicating across so many different channels,” Ms. Trudi Hartzenberg, Executive Director of the Trade Law Center (tralac) explained.
The selected Senior Trade Journalists on the continent were update on the current state of the AfCFTA among others. The journalists were also taken through methods and tools in reporting on AfCFTA.
Pan-African Payment and Settlement System drives Africa’s banking integration (African Business)
Hopes of greatly boosting intra-African trade rest on the implementation of the African Continental Free Trade Area (AfCFTA). It is hoped that the initiative will reduce both tariff and non-tariff barriers to African cross-border trade, encourage the construction of much-needed logistics infrastructure and above all, create a new mindset, that potentially huge untapped markets lie on the doorsteps of every African business. The role of the banking sector in this process is often overlooked but it will be a central driver of this change and simultaneously be heavily impacted by it.The AfCFTA is a hugely ambitious undertaking. It seems an obviously attractive concept, given that 54 out of 55 African states have thus far signed the AfCFTA treaty, with only Eritrea yet to put pen to paper.
The AfCFTA came into force in January 2021 but it is important to note that its creation is a process not an event, with national trade and investment policies gradually being harmonised. Universal banking regulations are ultimately envisaged but this will be a long process and governments will be understandably keen to promote and defend the interests of their own domestic banks.
Perhaps the biggest effect of the AfCFTA on the African banking sector is the Pan-African Payment and Settlement System (PAPSS), a centralised payment and settlement system that was launched by Afreximbank with the support of the AfCFTA Secretariat last September.
As a continent-wide platform for processing, clearing and settling intra-African payments, it is designed to enable individuals, businesses and governments to make instant cross-border payments in the more than 40 different African currencies, thereby reducing the need for US dollars and other hard currencies and so, simplifying cross-border trade. Acquiring hard currency can be a particular challenge for small and medium-sized enterprises (SMEs).
Rethinking maritime trade in Africa (Businessday)
Any maritime nation can use the sea to transport goods and for other civilian purposes such as fishing. More recently, exploitation of resources above or below the seabed has generated significant debate among naval thinkers. When one comes in contact with the term “sea power” for the first time, it may connote military strength at sea. However, this is not entirely true because sea power has both the naval component and economic aspect. It is an aggregate of the nation’s naval force and the maritime industry. From history, most developed countries were founded on sea power.
Like most other developing countries, African nations have raw materials, but they are not seriously engaged in trade with one another and the rest of the world. Perhaps, that is why Africa, with a population of over one billion people and France, where there are just about 65 million people, have almost the same Gross Domestic Product (GDP).
Africa has to rely heavily on ships and ports to service its intercontinental trade, but Africa’s shipping and ports do not, in most cases, match global trends and standards. Africa’s minimal integration in world trade within the context of sea power results from inadequacies in its maritime sector, particularly in shipbuilding, human capacity, merchant and fishing fleet, and port facilities.
Skills Gaps Holding Back Open Skies For Africa – Aviation Experts (KT Press)
Aviation experts are currently meeting in Kigali to kick start a process on implementing a Single African Air Transport Market (SAATM) which has seen a low uptake on the African continent. Primarily, the goal of the SAATM was to fully implement the 1999 Yamoussoukro Decision. This means that all participants agree to lift market access restrictions for airlines, remove restrictions on ownership, grant each other extended air traffic rights (first through fifth freedoms, not affecting cabotage rights), and liberalise flight frequency and capacity limits.
In order to understand the reason behind the delays and challenges in implementing the SATM, the Common Market for Eastern and Southern Africa (COMESA) Secretariat on behalf of other Regional Economic Regions (EAC, IGAD, IOC and SADC) and the European Union (EU) signed a Grant Contribution Agreement amounting to €8million for the Support to Air Transport Sector Development (SATSD) in the Eastern Africa, Southern Africa and Indian Ocean (EA-SA-IO) Region. The outcomes of the SATSD baseline study and training needs analysis were presented this August 29, 2022 at a validation workshop showing the biggest challenges in implementation of open air space agreement.
Dr. Eyden Samunderu, a leading aviation professional expert said that “One the major findings being lack of investment in specialized and continuous training for aviation staff and many governments are not willing to invest in this”.
How protectionism hurts Africa’s aviation industry (The New Times)
ECOWAS Bank’s West Africa Outlook Pushes Intra-Regional Investment (Energy Capital & Power)
On September 1-2, leading policymakers and dignitaries, investors, analysts and executives will convene at the world-renowned CICAD venue in Dakar for West Africa’s foremost energy forum – MSGBC Oil, Gas & Power 2022. As this distinguished assemblage of speakers and delegates converge on the Senegalese capital, thoughts turn towards the future of West African energy. The release of the West Africa Development Outlook (WADO) from the ECOWAS Bank for Investment and Development (EBID) shines out all the stronger as a science-backed guiding beacon for upcoming discussions and foretaste of the regional agenda that will shape MSGBC 2022’s highly-anticipated keynote sessions and panels.
African countries vow to increase fish production through collaboration (SeafoodSource)
Djibouti-based Intergovernmental Authority on Development (IGAD), an eight-country trade bloc in Africa comprising of governments from the Horn of Africa, Nile Valley, and the African Great Lakes, is stepping up efforts to synchronize Africa’s sustainable fishing activities to achieve a 3 million metric tons (MT) of production per year, up from the current 1 million MT. Representatives from seven of the eight IGAD members met in Addis Ababa, Ethiopia, between 16 and 18 August, 2022, under the IGAD Fisheries Coordination Platform. The participants reviewed sustainable fisheries projects in each of the countries, and resolved to improve ongoing country-level measures to support alignment of “the actions promoting sustainable fisheries in the Horn of Africa.”
Ecofish, a EUR 50 billion (USD 50 billion) program promoting the sustainable management of inland and marine coastal fisheries resources in Eastern Africa, Southern Africa, and the Indian Ocean, is currently spearheading several fisheries projects in IGAD member-states – including those on Lake Victoria, Lake Tanganyika, and marine seafood initiatives along the Indian Ocean coastline. In Kenya, Ecofish is involved in a joint WWF project to advance sustainable growth of small-scale fisheries to improve of food security and local livelihoods in coastal Kenya and across East Africa.
Ecofish is also part of an IGAD project that support sustainable utilization, development, and management of fisheries on two transboundary basins of the Baro-Akobo-Sobat River – between Ethiopia and South Sudan and Lake Turkana – that is shared between Ethiopia and Kenya.
UN deputy chief calls for action to deliver sustainable development in Africa (UN News)
In welcoming the UN deputy chief, President Saied spoke of the new era in the world, citing the COVID-19 pandemic and the war in Ukraine, but also in Tunisia, which has a new Constitution that he said will establish greater accountability for all. The President said TICAD has already brought important results for Africa, and there will be much to do to implement agreements reached during this latest edition of the conference.
Ms. Mohammed recalled that the SDGs remain a very relevant framework in this new era, and TICAD has served as an important reminder.
In her remarks, the Deputy Secretary-General called for action to confront what she described as “the cascading impacts of multiple crises” facing the world today. She said recovery from the COVID-19 pandemic, the effects of the war in Ukraine, the climate emergency and the financial crisis, are placing already vulnerable populations under severe stress. “This ‘perfect storm’ is, in turn, creating a fertile breeding ground exacerbating existing and future conflict and unrest, thus compromising our collective efforts to achieve the SDGs and save lives and livelihoods,” she added.
Ms. Mohammed said countries have an unprecedented opportunity to overcome these challenges and address security and sustainable development in Africa. She underlined the need to accelerate action across three main areas to benefit African economies and achieve the SDGs.
Africa received its highest proportion of private sector investment in infrastructure in 2020, sending an important signal to governments and investors. African Development Bank Vice President for the Private Sector, Infrastructure and Industrialization, Solomon Quaynor, underlined this point during a webinar organized by the African Development Bank and the Japan International Cooperation Agency (JICA) on 24 August.
Quaynor said the greater private sector investment came as most African governments contended with the Covid-19 pandemic, limited fiscal space and high debt-to-GDP ratios. “Private sector investment into Africa’s infrastructure rose to $19 billion in 2020, representing 23%, the highest since 2016. This counter-cyclical role played by the private sector shows the importance of its growing role in infrastructure financing in Africa,” he said in remarks at the close of the webinar, themed Private Sector Infrastructure Development Opportunities in Africa.
TICAD 8: UNDP-Africa-Japan Impact Report | United Nations Development Programme (UNDP)
Global economy
Pamela Coke-Hamilton | Four ways to transform Africa-Caribbean trade (Jamaica Gleaner)
on the eve of this historic meeting, Africa-Caribbean trade remains well below its potential. In 2020, not even 0.1 per cent of African exports were destined for Caribbean markets while Africa bought less than one per cent of Caribbean exports. Trade is heavily concentrated in a small handful of products and countries on both sides. In fact, trade between Africa and the Caribbean is less diversified than their exports to any other region of the world.
But with the right opportunities, analysis, and support, this situation can change. Analysis by my staff at the International Trade Centre (ITC) estimates that there is US $1 billion of export potential between the two regions, across goods and services. The figures are startling. In goods trade alone, we found that Africa could boost its exports to the Caribbean by more than 50 per cent in less than five years, potentially exporting $325 million every year. The Caribbean, in turn, could increase its annual goods exports to Africa by almost one-third to reach $264 million. The new market opportunities are spread across several countries and products.
This potential cannot be unlocked without a serious, targeted push on both sides of the Atlantic. Let me suggest four actions that governments and companies on both sides of the Atlantic can take right now.
Communications and Informatics Minister Invites Delegates to Prepare a Ministerial Declaration for Global Digital Future (G20 Presidency of Indonesia)
The Digital Economy Working Group (DEWG) meeting of Indonesia’s G20 Presidency seeks to develop a global digital transformation agenda. Minister of Communications and Informatics Johnny G. Plate identified the alarming reality of digital divide, lack of digital literacy and digital skills, and increasing data leakage. Therefore, he invited all delegates to formulate a declaration to address the challenges of a digital future.
According to Johnny, the economic value of digitalization and the alignment of data flows across national borders to generate new ideas and innovations are fundamental issues. He also hoped that the discussions of this issue will continue in the next presidency.
As the first DEWG forum after the elevation of the Digital Economy Task Force, the Minister of Communications and Informatics stated that there are many opportunities in the digital sector that can be of common concern. “At the same time, we see and identify the opportunities that lie ahead, the economic value of digitization, the alignment of data flows in generating new ideas, and technological innovation. The fact is that DEWG is the first group after the elevation of status from digital economy task force,” he explained.
UNGA77: 5 key things to know about the upcoming General Assembly session (UN News)
With just a few weeks to go until the opening of the 77th session of the UN General Assembly, the UN diplomatic community, as well as residents of New York City, are bracing for the annual arrival of Heads of State and Government from around the world, after two years of disruption wrought by COVID-19. Many details are still to be confirmed, but here are five things to look out for between 12 and 27 September.
Related News
tralac Daily News
Local news
S. Africa: Anti-dumping duties suspended for some countries (Poultry World)
This, says the minister, is in light of the rapid rise in food prices and the impact that the imposition of the anti-dumping duties may have on the price of chicken. According to the USDA, although the Commission investigating dumping found that poultry originating in these countries was dumped into the Southern African Customs Union market and recommended the application of anti-dumping duties, the Minister determined that “the imposition of these duties would have a negative impact on the poor”.
The current anti-dumping duties imposed against US bone-in chicken meat exports to South Africa outside of the Tariff Rate Quota expire on 23 November this year. The commission will consider information submitted by local industry to determine whether there is sufficient evidence to justify the initiation of a further review, or if the duties should expire as scheduled.
“The local poultry industry is sensitive to the plight of cash-strapped consumers and understands that food price inflation can negatively impact South Africa’s population. However, poultry producers also feel that the minister’s announcement flies against the spirit of the Poultry Sector Masterplan, which specifically listed tariff measures as an important pillar to put a stop to dumping,” said Izaak Breitenbach, GM of the South African Poultry Association Broiler Organisation, adding that the latest decision seems to demonstrate that dumping is “okay”.
SA’s farmers will be pushed to plant less because of Botswana, Namibia vegetable import bans (Business Insider South Africa)
South Africa is not likely to face a vegetable glut because of Botswana’s and Namibia’s import bans, as farmers in the country will be forced to plant fewer vegetables, a move that will hurt export revenue and lead to job losses in the sector. “South Africa is not likely to face a problem with oversupply as farmers are alive to the threat this poses to their revenue. What is more likely is that farmers may decrease the hectarage planted,” Christo van der Rheede, Agri SA’s executive director, told Business Insider SA, speaking about the impact of the long-term bans. Van der Rheede said South Africa can only absorb produce meant for Botswana and Namibia to a limited extent.
“In theory there are markets for South African products outside of [the] Southern African Customs Union (SACU, both on the continent and beyond. What remains to be seen is whether this can be arranged timeously, and whether it would be economically viable to do so,” said Van der Rheede. He said factors such as the condition of roads, rail, and ports must also be considered when factoring in whether other markets can viably absorb this season’s produce.
“It is disappointing that intra-regional restrictions have put South African farmers in this precarious position when the purpose of SACU is to foster open trade within the union,” he said.
Boost for Beitbridge border efficiencies, revenue flows (Bulawayo24 News)
INFRASTRUCTURE developments taking place on the road network and at the Beitbridge Border Post will enable more traffic to pass through the country and increase revenue inflows. Shipping and Forwarding Agents Association of Zimbabwe (SFAAZ) board chairman Godfrey Muswere said the ongoing refurbishment of the road network and the Beitbridge Border post would increase efficiency and boost revenue generation.
“Beitbridge is the biggest border post going to the North, and with the new roads that are being built, we will certainly get more traffic passing through the country, which is revenue for Zimbabwe,” he said. “When we have better infrastructure that means more efficiency for our operations.”
Exports on course to reach year-end target (Sunday Mail)
According to the Zimbabwe National Statistics Agency (ZimStat), exports grew 31 percent during the first half of the year compared to the same period last year. In the period, export revenue stood at US$3,3 billion compared to US$2,5 billion over the same period in 2021. Reserve Bank of Zimbabwe (RBZ) figures also show that trade volumes are growing. In the January-June period, service exports rose to US$176 million from US$103 million a year earlier. Imports increased by 18 percent to US$4,1 billion from US$3,4 billion in 2021. Although some might view growth in imports as unfavourable, it is encouraging to note that the bulk of imports have been machinery and equipment, as well as raw materials.
Government driven business reforms to spur development (Kenya News Agency)
The government has launched extensive business reforms across the country in an exercise aimed at creating a conducive investment environment for local and foreign investors in counties as a way of promoting industrial growth and manufacturing amongst the devolved units. Through the Ministry of East African Community and Regional Development (MEAC), the government has identified ten counties for piloting the reforms spearheaded by Directorate of Business Reforms and Transformation (BRT) with an aim of bolstering Kenya’s competitiveness as a choice destination for investors.
UK protests proposed Kenya ban on second-hand imports of buses, trucks (The East African)
fearing the embargo will cut the flow of used commercial vehicles from the European country. Betty Maina, the Industrialisation and Trade Cabinet secretary, says authorities in the UK are uncomfortable with the sanction on used vehicles, which was set to take effect from July 1 before it was frozen in court. An escalation of the differences between Kenya and Britain could affect the flow of goods between the two nations. Kenya and Britain inked a fresh trade deal in December 2020 allowing duty-free access of Kenyan goods to the UK market and to avoid a post-Brexit disruption. The protest will be handled by the Kenya-United Kingdom Economic Partnership Agreement (EPA) Council, Ms Maina said.
How Russia-Ukraine war hurts Kenya tea exports (Business Daily)
At the beginning of the year, it cost a tea exporter about Sh357,000 ($3,000) to ship a 40-foot container to Russia, Kenya’s fifth biggest market for the beverage. Today, it is about Sh952,000 to the nation and other neighbouring regions around the Black Sea. Europe may be miles away from Kenya, but the impact of the ongoing Russia-Ukraine war is being felt by the local tea farmers. The sharp rise in cost has been occasioned by the longer distance that the ships have to navigate to reach their final destination following the closure of the Black Sea route.
“If there is a sector that has been hit the hardest, it is tea. We have never witnessed such a huge jump in shipping cost in my history of exporting the beverage,” said Rodgers Lai, a Mombasa-based tea buyer. Mr Lai said high shipping costs have made Kenyan tea expensive in the world market, hence cannot sell competitively globally as enormous shipping costs have made the country’s tea more expensive.
Tanzania firms get nod to import raw material for wire products tax free (The East African)
Tanzanian companies have been granted exemption on imported products that attract 35 percent duty, barely a month after the EAC Common External Tariff came into force. In a legal notice signed by the EAC Council of Ministers chair Betty Maina, the companies can now import, at zero percent for a year, raw materials and inputs for the manufacture of wire products. The decision follows an application by Afriweld Industries, Tanuk Africa Ltd, MM Integrated Steel Mills and other firms for duty exemption. This came just as the region started to implement the four-band Common External Tariff (CET) structure that came into force on July 1.The structure has rates of zero, 10, 25 and 35 percent for all products imported into the EAC.
“A remission of import duty is approved for Tanzania for 12 months to apply a duty rate of zero percent for the specified manufacturers on raw materials and inputs for the manufacturers of wire products,” said Ms Maina, Kenya’s Cabinet Secretary for Trade and EAC.
Customs agents blame CBN forex ban list for decline in cargo volumes in Nigerian ports (Nairametrics)
The Association of Nigerian Licensed Customs Agents (ANLCA), has stated that the Central Bank of Nigeria’s forex prohibition list and the crashing of the Naira is responsible for the declines in cargo volumes at Nigerian ports. The submission by the agents was conveyed by Dr Kayode Farinto, Acting President, Association of Nigerian Licensed Customs Agents (ANLCA) in a television programme monitored by the News Agency of Nigeria on Thursday in Lagos. He stated that the apex bank was encroaching on fiscal policy, a purvey of government, which led to the decline in the importation of cargo to Nigeria.
“Before now, Nigeria had lost 45% of its cargo to Lome, because, they have a deep seaport. But with the coming of the Lekki Deep Seaport, we will witness berthing of large vessels in Nigeria,” he said. He advised the government to establish a ministry to monitor the African Continental Free Trade Agreement (AfCFTA) in order to prevent Nigeria from turning into a garbage dump.
ICT, trade as major drivers, oil shrank: Takeaways from Nigeria’s GDP Q2 report (TheCable)
Expansion in the non-oil sector pushed Nigeria’s gross domestic product (GDP) to 3.54 percent year-on-year in real terms in the second quarter of 2022. According to data released by the National Bureau of Statistics (NBS), the development is an improvement from 3.11 percent growth recorded in the first quarter. On a year-on-year basis, NBS said the second quarter of 2022 growth rate decreased 1.47 percent points from 5.01 percent growth rate recorded in the corresponding quarter in 2021. The International Monetary Fund (IMF), in its World Economic Outlook (WEO) for July 2022, retained a projected economic growth of 3.4 percent for Nigeria in 2022. But what sectors are behind the uptick in the nation’s GDP?
Diversification as necessary policy option for de-risking Nigeria’s economy (The Guardian Nigeria)
Amid the backdrop of rising uncertainty around the globe, Nigeria managed to pick up a 3.54 per cent growth in the second quarter (Q2) of the year. The Q2 performance is 43 basis points (bps) ahead of the previous quarterly data and a slight top-up of the 3.4 per cent yearly growth projected by the International Monetary Fund (IMF). The outlooks of several regional economies are blunted by rising uncertainty, spiraling prices and geopolitical tensions. These are already pulling growth figures towards the negative territory. For instance, the world’s largest economy contracted by 0.6 per cent in Q2, coming after a steep 1.6 per cent slump in Q1. In the same period, China’s growth waned to 0.4 per cent from 4.8 per cent in the previous quarter, forcing its central bank into monetary easing.
speaking at the 33rd Seminar for finance correspondents and business editors held concurrently in Abuja and Lagos at the weekend, economists said deliberate efforts must be made to address these imbalances such that both sectors can contribute equally to FX earnings and public revenue. The experts picked RT200 FX Programme and other development roles of the Central Bank as a pointer to likely policy the government could explore to consistently improve the contribution of non-oil to FX earnings.
At the seminar tagged, Policy Option for Economic Diversification: Thinking Outside the Crude-Oil Box’, a leading economist, Dr. Biodun Adedipe, said the current structure is hostile to inclusive growth, adding that “a cocktail of policy options” must be adopted to break the jinx to position the economy for sustainable growth.
Declaring the seminar open, the Governor of the Bank, Godwin Emefiele, said the quest for building a more sophisticated economy anchored on agriculture, micro, small and medium enterprises (MSMEs), industrial and manufacturing exploits have become the major components of the bank’s price stability policy thrusts.
He said that Nigeria has largely depended on the oil sector for revenue generation over the past four decades and that the sustained decline in production has continued to undermine the performance of the economy. This, he said, necessitated the drive to diversify to other non-oil sectors.
Brazil, Nigeria Trade Relations Recorded $281bn Export Earnings in 2021, Says Ambassador (This Day)
The Brazil and Nigeria trade relations recorded $280.81 billion in export earnings in 2021.However, Nigeria’s export earnings to Brazil was $47.2 billion in the year under review. In the area of imports in 2021, Brazil was higher with import earnings of $219.41billion, while Nigeria recorded earnings of $52.1 billion. The Brazilian Ambassador to Nigeria, Francisco Soares Luz, disclosed this yesterday, at a media briefing in Lagos, to announce the forthcoming Brazil-Nigeria business forum 2022. The forum is to take place in Lagos at Eko Hotel and Suites, as part of activities marking the Brazil’s Bi-centennial anniversary.
He said Brazil remains committed to strengthening trade relationship with Nigeria, stating that in 2021 some of the import commodities were iron ore, soybeans, crude petroleum, sugar, and beef, while the export commodities were refined petroleum, chemicals, crude oil, vaccines, fertilizers.
African trade and integration
WCO highlights the role of Customs in the implementation of the AfCFTA at TICAD 8 side event (WCO)
On 22 August, the Secretary General of the World Customs Organization (WCO), Dr. Kunio Mikuriya, participated as a panelist in an online side event titled “Deepening Regional Economic Integration, AfCFTA (African Continental Free Trade Area) and Trade Facilitation in the Post COVID era”, co-organized by the World Bank Group (WBG) and Japan International Cooperation Agency (JICA), in the context of the 8th Tokyo International Conference on African Development (TICAD).
The side-event saw the participation of high-level representatives from the International Organization for Migration (IOM), JICA, the AfCFTA Secretariat, as well as the private sector. The speakers discussed the successful realization of the AfCFTA in the post-COVID era, as well as challenges, examples of efforts, potential solutions, and future directions for trade facilitation and border control in support of the AfCFTA. They also discussed on strategies to find a common understanding and foster momentum for deepening regional integration.
Secretary General Mikuriya explained the current situation surrounding Customs administrations around the world, such as supply chain disruption caused by the COVID-19 pandemic. He expanded on the sharp rise of the number of the E-commerce packages, and emphasized the importance of an efficient trade management, supply chain resilience for the potential emergency in the future and Customs role, including the following aspects: digitalization of border procedures towards paperless trade and contactless clearance to keep supply chain open; Customs role in risk management at borders for public health and security; coordination among border agencies and cooperation between Customs and business; regional integration through application of tariff reduction based on the rules of origin to identify the eligibility of preferential tariff; capacity building for Customs administrations, in cooperation with the EU, JICA and other donors; Trade facilitation measures, including OSBP with standardized operations; and the interoperability of Customs IT systems for effective sharing information of data.
The government of Japan and the African Development Bank have announced a $5 billion financial cooperation under the fifth phase of the Enhanced Private Sector Assistance for Africa initiative (EPSA) from 2023 to 2025. Given the importance of food security, Japan and the African Development Bank will add agriculture and nutrition as a priority area under EPSA 5.
A Japanese economic zone in SCZone can be gateway for Japan exports to Africa: Madbouly tells PM Kishida (Ahram Online)
New trade agreements to unlock African markets and new tariff for East Africa (Hortgro)
South African deciduous fruit may have access to new markets in the coming years, thanks to two new trade agreements. In the meantime, however, a new tariff for fruit has been introduced in East Africa. Trade with other African countries has historically been difficult due to logistics, governance, and complex border control requirements. However, these countries hold significant potential for South African exporters. If the two massive African trade agreements currently nearing completion can address challenges and barriers to trade, South African companies could benefit from a larger playing field. These trade agreements are the African Continental Free Trade Agreement (AfCFTA) and the Tripartite Free Trade Agreement (TFTA). Though in their final stages, neither of these agreements are functional yet. It is expected that duty-free trade will only begin in 2023 or early 2024.
In 2020, 23% of South Africa’s world exports were to the rest of Africa, but of that, only 3% of South Africa’s world exports were to African countries that are not members of SADC. Imports from Africa to South Africa predominantly consist of crude petroleum oil, accounting for 37% of South Africa’s overall African imports. This illustrates that the SADC trade agreement has facilitated trade, and the trade balance has been in SA’s favour.
AfCFTA Gets Togo’s Backing In Shipping Promotion (The Tide)
The Secretary General, Maritime Organisation of West and Central Africa (MOWCA), Dr. Paul Adalikwu, has received support from the government of Togo to promote shipping as a core element for the success of African Continental Free Trade Area (AfCFTA).
Adalikwu, who was in Lome at the instance of the Togolese Minister of Maritime Economy, Fisheries and Coastal Protection, Mr Edem Kokou Tengue, also received reassurance on the West African country’s commitment to actualise the transformation of MOWCA to African Maritime Organisation (AMO).
According to a statement,Tengue also expressed his country’s readiness to contribute to the timely take off of the Regional Maritime Development Bank, whose charter they had assented to, with a promise to diligently consider the appointment of Togo’s representative of the bank’s Board of Directors and pay up his country’s arrears of contribution to MOWCA.
SADC PPDF approves US$20.2 million for preparation of 12 regional projects (SADC)
The Southern African Development Community Project Preparation Development Facility (SADC PPDF) has approved a total of US$20.2 million for the preparation of 12 regional projects covering energy, transport and water sectors, and these are expected to generate at least US$3 billion in infrastructure investment. The projects have a huge potential of unlocking business opportunities across the infrastructure value chain, not just in advisory services, but also financing, construction, equipment supply, technology and skills as well as operations and maintenance.
Among the projects approved by the PPDF and funded by the European Union (EU) and KfW Bank of Germany are the Second Alaska-Sherwood powerline in Zimbabwe; the Angola-Namibia transmission interconnector; Kasemeno-Mwenda toll road and Luapula hydro power development both between DRC and Zambia, Mulembo Leyla Hydro in Zambia; the North South Rail Corridor involving Botswana, DRC, South Africa, Zambia and Zimbabwe. The projects also include Mauritius Wastewater Pumping Station and Wastewater Treatment Plant; MOZISA power interconnector project between Mozambique, South Africa and Zimbabwe; Africa Green Co projects (all SADC Member States); Kazungula Water Supply and Sanitation Project (Zambia); Lomahasha Namaacha Cross (Eswatini and Mozambique); and Development of Guidelines and Standards for Renewable Energy Projects including a funding and Incentive strategy in Mauritius.
The PPDF aims to assist SADC to address the implementation of the SADC Regional Infrastructure Development Master Plan (RIDMP), which will promote and contribute to enhancing regional economic integration in the Region.
Good internet will increase Africa’s competitiveness, innovation – expert (The New Times)
For Africa to improve its competitiveness and innovation on the global arena, it needs a good and affordable internet. For that to happen, Africa needs to rely on local internet rather than international links.
Senior Director of Internet Technology and Development at Internet Security, Michuki Mwangi outlined how accessible and affordable internet end user experience increases adoption and dependability. “Data shows that we still have more than 40 per cent of the population in Africa still not connected and there’s work to be done in that space.
“There are different business models that can actually be sustained in those areas because the areas that are yet to be connected are those in rural parts that are harder to reach; the traditional business cases don’t apply and so we need to look at different business cases and also technologies that can actually allow to connect those people because they’re in harder area to reach.”
The ‘Big Four’ are leading Africa’s start-up scene—Nigeria, Egypt, South Africa and Kenya (ThePrint)
Funding secured by Nigeria, Egypt, South Africa and Kenya has continually increased over the years: from a 79.4% share in 2018, to 87.5% in 2019 and then 89.2% in 2020. These figures stand in sharp contrast to the cash raised by countries like Ethiopia, the Democratic Republic of Congo and Tanzania, all of which still record a low level of start-up investment activity. While capital funding is undoubtedly on the rise in Africa, it is becoming more concentrated in the big-four countries. According to the 2021 Disrupt Funding report, non-big-four African countries raised $170,607,500. That is just 7.9% of the continent’s total.
The report also indicates that more than 40% of that funding was secured by start-ups from Ghana, Morocco and Tunisia. According to one report, Algeria raised $30 million in start-up funding; Morocco raised $29 million and Tunisia raised $23 million in venture funding in 2021. These investments are relatively minor compared to the funding raised by the big-four countries in Africa year after year.
Invest in agriculture statistics – AfDB implores Africa (Farmers Review Africa)
AFRICA should invest in quantity, quality and heightened dissemination of agricultural rural information for sustained food security and endeavour to insulate the continent from among other headwinds, food versus. Bio-fuels, global warming, environment, gender, and food security, COVID 19, the African Development Bank says. Despite the continent’s potential to remain sustainable and food secure and further improve the rural economy, the lack of reliable data and capacity to disseminate to various end-users has dwarfed the continent’s growth despite the various available initiatives AfDB and other players have initiated over the years. The emerging of new data requirements to inform policy on the emerging development has worsened the situation.
Calling for just, well-financed climate action in Africa (Africa Renewal)
Climate change is an increasing threat to Africa, and your appointment comes at a time when Africa will be hosting the global climate talks (COP27) in November? Ms. Kenewendo: Given that Africa has contributed little to global emissions so far, but it is already being disproportionately affected by the impacts of climate change, mine is to push for African countries and non-State actors to be active leaders in driving and leading action towards a managed, just and financed transition. A climate action-oriented path offers Africa the opportunity to avoid the mistakes of a totally high carbon industrialization and seize the opportunity to leapfrog into a new economy and a better form of growth that can deliver on both its development and climate goals. We are focused on highlighting opportunities that exist in this space; new industries, jobs and development.
Tanzania, Kenya to miss out on China debt relief plan (The East African)
Tanzania could join Kenya on a list of countries that will be left out of the Chinese debt relief deal at the end of this year by virtue of their lower-middle-income status even as the East African nations grapple with a growing debt burden. Chinese Foreign minister Wang Yi has announced that the world’s second-largest economy would forgive 23 matured interest-free loans for 17 undisclosed African nations that are classified as least developed countries (LDC).Last week Chinese authorities in Nairobi said Kenya, which is struggling with a debt of over Ksh8.6 trillion ($72.26 billion), was left out of the deal as it is classified as lower-middle-income. Tanzania also transitioned from low-income to lower-middle-income status in July 2020 after experiencing over 20 years of sustained economic growth.
Beijing made the announcement of the new debt relief plan on August 18 during the Forum on China-Africa Cooperation as it seeks to boost ties with its African allies.
Global economy
What would BRICS expansion mean for emerging markets? (The Borneo Post)
As emerging markets recover from the Covid-19 pandemic and face financial headwinds due to interest rate hikes in the US, the BRICS group – Brazil, Russia, India, China and South Africa – is looking to expand its membership to tackle shared challenges. At the 14th BRICS Summit held in July, China, Russia and India discussed the potential entry of Egypt, Saudi Arabia and Turkey, which are reportedly preparing applications. This announcement came after the disclosure in June that Iran and Argentina had already applied with support from China. In addition, international media has reported that Algeria, Bangladesh, Indonesia, Mexico, Nigeria, Sudan, Syria, Pakistan and Venezuela have expressed interest in joining the organisation.
An online meeting hosted by China in May of potential BRICS+ applicants included the foreign ministers of Argentina, Egypt, Indonesia, Kazakhstan, Nigeria, the UAE, Saudi Arabia, Senegal and Thailand. It is unclear who will join and when, as there is no formal process for welcoming new members, and any expansion would likely take place in piecemeal fashion. However, BRICS expansion could offer emerging markets the opportunity to build new economic synergies.
Major economies sharply increased support for the production and consumption of coal, oil and natural gas, with many countries struggling to balance longstanding pledges to phase out inefficient fossil fuel subsidies with efforts to protect households from surging energy prices, according to analysis released today by the Organisation for Economic Co-operation and Development and the International Energy Agency.
New OECD and IEA data show that overall government support for fossil fuels in 51 countries worldwide almost doubled to 697.2 USD billion in 2021, from 362.4 USD billion in 2020, as energy prices rose with the rebound of the global economy. In addition, consumption subsidies are anticipated to rise even further in 2022 due to higher fuel prices and energy use.
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OECD report calls for caution (SAnews)
South Africa faces the threat of reversing social gains if it does not adequately address potential future shocks. This is if the country does not address challenges in health, infrastructure and education. This warning was fired by the Organisation for Economic Co-operation and Development (OECD) while presenting the country’s 2022 economic survey.
Addressing a virtual media briefing on Thursday, OECD Acting Chief Economist, Álvaro Pereira, said these were long term and structural challenges that need to be addressed. He said: “If not tackled adequately, they could threaten the social gains achieved so far. And this will require improving considerably the efficiency of public spending through better public procurement and the management of public funds.” In the medium to long term, he says, tax revenue mobilisation will be critical, saying lifting tax revenues will be necessary to restore the sustainability of public finances and to finance growth in housing reforms.
Beyond this, Pereira said the country faces a long-term challenge of low productivity.
South Africa urged to consider its contribution to the global battery value chain (Engineering News)
Batteries are fast becoming the core of modern energy systems and more sustainable economies, underpinning the implementation of smart grids and minigrids, while fostering the rollout of renewable energy and e-mobility, and yet, South Africa’s involvement in the battery value chain remains limited. Trade and Industrial Policy Strategies chief economist Gaylor Montmasson-Clair questions whether South Africa will be an importer of batteries only, or if it will manage to become a part of the value chain.
Can Namibia turn oil into prosperity? (GIS)
The recent discovery of large reserves of crude oil off the coast of Namibia has fueled speculation about the fate of the sparsely populated country, whose economy has been largely dominated by mining, agriculture, fishing and tourism.
Namibia and South Africa are two of the world’s most unequal societies in terms of income and wealth distribution, with Gini index scores of 59.1 and 63, respectively. Together with Zambia, they place three members of the Southern Africa Development Community (SADC) among the four most unequal countries globally.
The oil discovery thus cements Namibia’s place among those resource-rich countries in the region, which has a history of conflict over assets like minerals, oil and gas. It has led to talk about whether oil exploration could help Namibia double its gross domestic product (GDP) by 2040. And it could shape not only the country’s own development but also benefit the SADC as a whole, with successful exploration and management of oil revenue in Namibia delivering value to other jurisdictions in the region.
End of fuel subsidy to increase food prices – Tegemeo Institute (The Star)
Food prices are expected to increase in October if the fuel subsidy comes to an end as recommended by the International Monetary Fund (IMF). Timothy Njagi, a senior researcher from Tegemeo Institute has said if the Government adapts the IMF recommendation to end fuel subsidy by October this year, the move is likely to push the cost of food up.” Between now and October, prices of food, especially maize, are likely to stabilise due to the little harvest from the South Rift. But the key determinant of the cost of food will be fuel. The end of the subsidy will have a ripple effect,” he said.
IMF report stated that the authorities intend to continue gradually realigning domestic to global fuel prices in FY2022/23 so as to eliminate the fuel subsidy by October 2022.
While speaking to the Star on Wednesday during an interview, Njagi said the IMF recommended that the Government puts to an end the fuel subsidy as of October 1, 2022, because it was not sustainable.
“The move will affect many things including the cost of processing food and electricity and if this goes up, you can expect food prices to continue increasing,” said Njagi. “But if the Government manages to get funds to maintain the subsidy this will prevent the prices from going up,” he said.
Uganda pushes for internet cuts to promote digital financial services (The East African)
The Ugandan government is pushing for lower internet costs to promote the usage of digital financial services across the country in a bid to increase financial inclusion for vulnerable groups. According to the Ministry of ICT and National Guidance, the country will, by the end of this year, reduce the cost of data it provides through the national backbone infrastructure fibre by more than half from $70 per Mbps per second to $30.This, the ministry says, will support the growth in ICT innovations, digital financial services, communication, e-government services among others.
“We are talking about purely government internet. Once we cut down the cost at which government is selling to services providers, then they will automatically also reduce the cost that the end user will be paying and we think this will help in our efforts to digitise our economy,” Mr Chris Baryomunsi, the Minister for ICT and National Guidance, told The East African on Wednesday.
The government has completed a $75 million National Data Transmission Backbone Infrastructure and e-Government Infrastructure Project.
Substandard Goods: SON Seeks Better Collaboration To Shield Local Infant Industries (Leadership)
The Standards Organisation of Nigeria (SON) has advocated the need for improved collaboration between the agency and the players in the Nigeria manufacturing sector so as to redefine the process of production of goods to meet acceptable standards in the country. According to SON, only the manufacturers play according to the set standards to support the fight against substandard goods that Nigerian goods can compete favourable at the international market and stand the test of time.
The director General SON, Malam Farouk Salim, gave the assertion on Tuesday at the 51st annual general meeting in Lagos organised by the Manufacturers Association of Nigeria (MAN) with the theme, Standards: An imperative for competitive manufacturing in a continental and Global Market.
He explained that the agency will continue to ensure that local manufacturers are protected against importation and influx of fake and substandard goods in the country. SON asserted that it is determined to assist businesses and local manufacturers to become competitive and successful through it’s various standardisation and quality assurance efforts.
On his part, the national president of MAN, Engr Mansur Ahmed, assured that, the manufacturers will continuously collaborate with SON and ensure that any of its members that doesn’t sustain with the set standards is brought to book. Engr Ahmed implored the local infant industries to adhere strictly to the standards so as to give their products a face in the African Continental Free Trade Agreement AfCFTA.
Nigeria seeking extra $410bn for energy transition plan including gas (Engineering News)
Nigeria needs at least $10-billion in additional funding per year to reach net zero by 2060 in a plan that would involve gas as a transition fuel, officials said while launching the nation’s energy transition plan on Wednesday. The effort aims also to expand power access to all of Nigeria’s 200 million citizens by 2030, a move officials said was essential to ensure a fair transition for developing nations.
Representatives of Nigeria’s Diaspora, national networks, and youth and women groups have hailed the African Development Bank for supporting transformational projects in the country and across Africa. The African Development Bank forum, which took place in early August, is part of the institution’s ongoing mid-term review of its country strategy for Nigeria. Over two days, more than 200 participants received updates on the bank’s work in Nigeria. They discussed projects in agriculture, on the digital economy, the creative industry, trade and private enterprise.
Opening the forum, the African Development Bank’s Director General for Nigeria, Mr. Lamin Barrow, expressed hope that the interactive forum would allow for frank exchanges on the bank activities, projects and programs in Nigeria. Barrow stressed the bank’s commitment to participation by women, youth, the diaspora and other key groups in processes that inform the institution’s initiatives in its regional member countries. “Stakeholder groups play key roles in driving innovation and entrepreneurship to unlock opportunities in various sectors, including agri-business, industry and the digital economy,” he said.
African trade and integration
Existential priorities for the African Continental Free Trade Area (UNECA)
This book aims to guide and assist implementation of the African Continental Free Trade Area (AfCFTA) over the next 10 years. Each chapter considers a key area, raises issues for attention and points to possible ways forward. The introduction highlights the progress as of the end of 2021 in operationalizing and implementing the AfCFTA, while identifying the developmental challenges and existential threats ahead. The systems approach requires actions at the national, regional, continental and global levels. It involves continuous learning as a pivotal tenet of socioeconomic transformation and improvement. Lessons learned are continuously brought to bear on policy formulation and implementation. The Book has three parts. Part one has five framing chapters: Africa in the world, the architecture for Africa’s regional integration, two publics, economic integration, and from ratification to implementation. Part two covers energy costs, textiles and clothing, women and youth in trade, and the free movement of people. Part three considers digitalization, technology and innovation, and public health as critical areas during the next 10 years.
GITFiC to launch book on AfCFTA (News Ghana)
The Ghana International Trade and Finance Conference (GITFiC) will on September 20, 2022 launch its book on the African Continental Free Trade Area (AfCFTA) in Accra, Ghana. The Book: “Actualising the African Economic Vision-A Practical Handbook on the AfCFTA” has been on the drawing board for almost a year
“The manuscript has been reviewed by several authorities including the African Union. After an extensive peer review by the AU, the book has earned a two-minute video endorsement with a strong advocacy for Africa’s Educational Structures to embrace the book and same for every person wanting to do business on the African Continent going forward.
EABC calls for the removal of restrictions to boost trade in services in the EAC (EABC)
Mr. John Bosco Kalisa, EABC CEO has called for the finalization of regulations on Mutual Recognition of Academic and Professional Qualifications and a roadmap for the removal of restrictions to boost trade in services in the EAC bloc. Under the Common Market Protocol, EAC Partner States made commitments to liberalise seven priority service sectors, as follows: Business, Communications, Distribution, Education, Financial, Tourism and Travel and Transport.
Speaking at the Virtual Launch of the EABC Barometer on Trade in Services in the EAC, Mr. Kalisa elaborated that legally all restrictions in the liberalised seven service sector that were maintained by EAC Partner States in their schedule of commitment should have been removed by December 2015.
Mr. Kalisa said “The EABC Barometer shows a very positive trend, as EAC Partner States have committed to liberalise 92 new sub-sectors under the revised schedule of progressive commitment.” This lays the foundation to build an integrated EAC services market and will result into commercially meaning-full trade of services in the EAC bloc once implementation commences, Mr. Kalisa explained
The new sub-sectors added are in key sectors like business services (37); transport services (36) and financial sector (10), which are all critical as key sectors in their own right and as intermediate inputs in the manufacture of goods and production of other services.
Report: East African Single Currency Unlikely to Be Introduced by 2024 (Bitcoin News)
There are growing doubts about the regional economic bloc known as the East African Community’s ability to successfully launch a single currency by 2024, a report has said. One of the reasons for this is member states’ delays in meeting targets as set out in the roadmap.
Central banks from an African economic union, the East African Community (EAC) are reportedly unsure if plans to introduce a single currency for the region by the year 2024 will be realized. The central banks cite some member states’ failure to meet targets as set out in the roadmap as one of the reasons why the single currency is unlikely to take off as planned. As per a report in the East African, members of the six-nation East African Community hope that the envisaged common currency will help reduce the costs associated with converting currencies. There are also hopes the single currency, whose attainment is one of the EAC’s priorities for the period between 2022 and 2026, will eliminate the exchange rate volatility that comes with cross-border trading.
Meanwhile, in a communique reportedly released on August 22, the EAC confirmed that delays and other challenges meant the regional bloc cannot have a single currency by 2024 as planned.
East Africa’s manufacturers hit by costs and imports (Financial Times)
Many countries globally have pursued economic development through manufacturing and exports. In east Africa, for example, Kenya, Ethiopia and Rwanda have all sought to emulate approaches taken by South Korea or Mexico. However, manufacturing has recently gone backwards in many African countries, as local producers such as Osembo face being overwhelmed by rising costs, infrastructure problems that hamper logistics, high energy prices, unreliable power grids, tax and customs burdens, as well as cheap Chinese imports.
In Kenya — despite the country’s reputation as a freewheeling business environment — manufacturing has struggled to sustain a transformative rate of growth. As a sector, its share of GDP almost halved from a peak of 13 per cent in 2007 to 7 per cent in 2021, according to the World Bank.
Osembo cites high import taxes on supplies, customs bureaucracy and supply chain disruption among reasons to move manufacturing to Asia: “I am such a big believer in development, but also from a practical perspective, I need to be able to plug in the global supply chains.”
Rajan Shah, chair of the Kenya Association of Manufacturers and of Capwell Industries, a food processor, says that “low competitiveness, regulatory burden, and then tax unpredictability are probably the three major challenges”. He says corporate taxes and levies raise manufacturing costs by about 45 per cent. “If you compare that with other developed economies, that’s probably where they are — but, in a developing economy, where we are still building a middle-income class, it’s high.”
The Southern African Development Community (SADC) Secretariat has stepped up activities to facilitate negotiations of Double Tax Avoidance Agreements (DTAA) between Member States as part of the efforts to increase the network of DTAA and foster an aligned tax treaty policy across Member States. This will take into account developments both at regional and international levels, in particular, those related to Base Erosion and Profit Shifting (BEPS) issues. SADC Ministers of Finance and Investment approved the revised SADC Model on Double Taxation Avoidance Agreement and its Commentary at their meeting in Johannesburg, South Africa, in July 2018.To date, there are 59 DTAAs in force among SADC Member States.
Stakeholders Consult on Implementing the Regional Customs Guarantee Scheme in Zambia (COMESA)
A national consultative meeting on the implementation of the COMESA Regional Customs Transit Guarantee (RCTG) Scheme was conducted with key stakeholders in Zambia on Thursday 25 August 2022. The one-day session updated the stakeholders on the status of implementation and operations of the RCTG in the region and discussed issues and concerns raised about the Scheme in Zambia. The RCTG is a customs transit regime designed to facilitate the movement of goods under customs seals in the COMESA region and to provide the required customs security and guarantee in the transit countries.
COMESA Acting Secretary General Amb. Kipyego Cheluget who opened the meeting stressed the importance of having a common Customs Transit Bond Guarantee for Zambia and the region at large. “We have spent years discussing issues and concerns in implementation of the RCTG. The ten-year experience in the North and Central Corridor countries should give you comfort that SMEs are also beneficiaries of this scheme,” he said and called on importers, exporters, transporters, Clearing and Forwarding Agencies (CFA) to embrace the RCTG as it offers assured security for goods in transit.
He appealed for thorough discussion of the issues and concerns and objectively come up with a win-win proposal on how the RCTG Bond should be issued in the North-South Corridor countries.
Agricultural Development: Nigeria MP blames migration in ECOWAS states on food insufficiency (WorldStage)
A member of the Economic Community of West African State (ECOWAS) Parliament, Hon. Olujimi Biodun Christine has blamed migration in the sub-region on food insufficiency. Sen. Olujimi said if there was enough food in the sub-region the menace of migration would be greatly addressed.
“When you don’t have enough to eat, your family does not have enough to eat, they there is a problem, you need to migrate. But if there food sufficiency in West Africa we won’t have to be a part of this great migration that we all undertake.”
The MP speaking further called on ECOWAS states to empower women and youths to be more involved in Agriculture as a way of addressing food insecurity. She feels by so doing interests in white collar jobs will be drastically reduced and unemployment addressed.
She said, “I believe the youths and women are key to getting these things done. We need to encourage them, we need to give farm implements, we need to ensure that they are not going to use their physical strength to do it, we need to make sure that when they do it they get result and they are able to export and make the required foreign exchange which will spur them on to do better and greater things.
Free movement in West Africa: the culture of mobility still matters despite challenges (The Conversation)
ECOWAS is widely considered the most integrated of the eight regional economic communities on the continent. But it has failed when it comes to enabling the free movement of people. Its free movement protocols have never been fully implemented. At the same time, the original aim to improve mobility appears to be changing to one of control over mobility.
formal free movement is undermined by several regional and national hindrances. These include weak ECOWAS institutions, divergent national interests among individual member states and infrastructural challenges like accessing ID cards, as well as external influence from the European Union.
These implementation problems however work in convergence with a practice of everyday mobility across borders. Understanding the complexities of movement is key to better understanding and supporting mobility that speaks to the regional realities.
‘Africa’s COP’ is unique opportunity for continent to take determined stand - African leaders urged (Myjoyonline)
Experts and analysts say a just transition that supports Africa’s efforts to address the climate emergency must be the focus of a united African perspective. The experts advise that COP 27, also known as ‘Africa’s COP’, is an exceptional opportunity for the continent to take a determined stand and force the rest of the world to fully address its concerns and back up previous and future commitments with actual action. They made this recommendation ahead of the next Conference of the Parties in Egypt (COP 27). The African Risk Capacity Group, a specialised agency of the African Union established to assist African governments to improve their capacities to better plan, prepare, and respond to extreme weather events and natural disasters, made the call at the recently held virtual seminar to facilitate effective dialogues on COP27.
Experts urged world leaders and negotiators to reach an agreement on a delivery mechanism for the USD 100 billion that richer nations had offered to help poorer countries deal with climate change.
Tech partnerships can realise Africa’s economic potential (Ventureburn)
Africa stands on the cusp of a tech explosion with several nations having achieved sustained growth in internet-driven GDP (iGDP) – in many cases doubling from 1.5% to more than 3% since 2012. As the digital transformation continues to make stride across Africa, it is clearing the way and opening vast swathes of potential for its nations, businesses, and citizens. Some experts put the economic growth in Africa at $180 billion, and if trends continue it could rise to $712 billion by 2025. The flow of trade into and out of the continent is integral to this growth, and as the African Continental Free Trade Area’s (AfCFTA) effects begin to be increasingly felt, the amount of trade among African nations is set to double.
According to the UN Conference on Trade and Development, Africa currently accounts for 2.9% of the world production, and 2.6% of world trade. Intra-Africa trade stands at 15.4%. If the ease of regional and international trade improves, this figure could be significantly higher. For this potential to be realised, however, it is critical for governments to work together with businesses, in private-public partnerships (PPPs).
The work the Nigerien government has conducted in conjunction with the country’s private sector stands as a testament to this. As a landlocked country, it depends on its neighbour’s infrastructure to import and export goods, which can lead to prohibitive costs.
Deployed over four years, Single Window included the roll-out of a state-of-the-art Port Community System, created specifically for Niger as a landlocked nation. With one single platform through which all stakeholders – international and domestic traders, banks, and various administrative government departments – have access, Niger’s import/export processes have been streamlined and sped up. The platform digitises the approval of licenses and permits for imported/exported regulated products and provides payment platform for trade documents.
Japan-led conference aims to reignite Africa’s recovery (The Japan Times)
The worsening effects of climate change, the socioeconomic fallout from the COVID-19 pandemic and the food security crises exacerbated by the Ukraine war are just some of the challenges facing African countries. To discuss solutions to these and other pressing issues, dozens of African leaders — as well as representatives of international organizations, donor countries, private companies and civil society — are expected to come together on Aug. 27 and 28 in Tunisia for the eighth iteration of the Tokyo International Conference on African Development.
Japan’s approach to development assistance focuses on Africans charting their own path forward in partnership with the international community, with observers saying that Tokyo seeks to differentiate its economic cooperation with the continent from that of China, which has long surpassed Japan as a business investor.
According to the Japan International Cooperation Agency, there are several unique points guiding Tokyo’s engagement with the continent. These include respect for Africa’s ownership, the promotion of self-help programs, a focus on people and human security, and the use of Japan’s experience and know-how.
“We believe the lessons of Japanese modernization can be of help to African countries today, so that they can create their own development policies and strategies while keeping their cultures and traditions,” JICA Vice President Ryuichi Kato said in an interview with The Diplomat.
Japan’s approach is mainly geared toward accelerating inclusive economic growth through innovation and private-sector engagement, deepening regional integration, ensuring debt sustainability and supporting quality education and infrastructure projects.
Why Japan is changing its approach to Africa from aid to FDI (Quartz)
Global economy
Black Sea initiative Joint Coordination Center announces new route to export grain (ThePrint)
A new route to export grain under the Black Sea Initiative has been established from three Ukrainian ports, the Joint Coordination Center in Istanbul announced in a statement on Thursday. “The Joint Coordination Center (JCC) announced today a new route for merchant vessels going in and departing from the three Ukrainian ports of Odesa, Chornomorsk and Pivdennyi/Yuzhny under the Black Sea Grain Initiative,” the statement said, reported Sputnik. The new route is expected to be more efficient for the vessels to export the grain and will come into effect from August 26, the statement added.
The grain deal signed between Russia and Ukraine with the United Nations and Turkey has paved the way for the export of 22 million Ukrainian grains which remained stuck in three Black Sea Ports, becoming a “beacon of hope” for millions of starving people across the globe.
Millions of people in the world’s poorer nations that face an imminent danger of starvation breathed a sigh of relief on hearing the news that these desperately needed quantities of grain will reach the market and grain prices may become affordable once again.
10th Summit of OACPS Heads of State and Government to take place in Luanda, Angola (ACP)
The Organisation of African, Caribbean and Pacific States (OACPS), in collaboration with the Government of the Republic of Angola will host the 10th Summit of OACPS Heads of State and Government in Luanda, Angola from 6-10 December 2022.
Themed, “3 Continents, 3 Oceans, 1 Common Destiny: Building a resilient and sustainable OACPS”, the 10th Summit marks the first live meeting of OACPS Heads of State since the coming-into-force of the revised Georgetown Agreement in April 2020, the change in leadership at the Secretariat and the outbreak of the COVID-19 pandemic.
The Summit will be preceded by a Business Forum, which will address issues related to trade among Member States OACPS and key partners; a Women’s Forum on the Blue economy; and a Youth Forum which will focus on the importance of Road Safety. A new addition in the lead up to the Summit, the Diaspora Forum, will facilitate an exchange on key topics for the sustainable development of the 79 Member States of the OACPS.
EU to urge big polluters to toughen climate pledges by COP27 summit (Reuters)
The European Union will urge the world’s biggest economies to improve their targets to fight climate change ahead of this year’s U.N. climate summit and warn that states’ current efforts fall short, according to a draft document seen by Reuters. Despite a raft of new emissions-cutting commitments countries announced at last year’s COP26 climate summit, “global climate action remains insufficient”, the EU said in a draft of its negotiations mandate for the COP27 summit in Sharm El Sheikh, Egypt, in November.
The draft, which faces weeks of negotiations and could change before EU countries approve it in October, said polluters must revise their targets if the world is to stop global warming spiralling beyond 1.5 degrees Celsius.
But the talks on how to curb emissions, and fund those efforts, face the tough context of an energy crisis that is exhausting state budgets and prompting some countries to burn more coal.
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South Africa needs to step up its reform efforts to avoid its economic recovery from the COVID-19 pandemic losing steam, according to a new OECD report. Persistent weaknesses in productivity growth and the negative impact of Russia’s war of aggression against Ukraine on purchasing power through the rise in food and energy prices continue to weigh on economic activity.
The latest OECD Economic Survey of South Africa says that improving the tax system and reducing spending inefficiencies would help to put public finances on a more sustainable path, while taking action to revive productivity growth would help to revive GDP growth and raise living standards. If needed, the tightening of monetary policy should continue to allow inflation – which disproportionately affects the poorest households – to return to the Reserve Bank’s target. It is also vital to intensify efforts to raise the country’s low COVID-19 vaccination rate to reduce the health and economic risks from future outbreaks.
South Africa’s Intractable Illegal Gold Mining Problem (tralac)
Artisanal and small-scale mining tends to be a hand-to-mouth enterprise with economic sustainability being achieved only further along the value chain by aggregators involved in buying, smelting and trading the yellow metal. Nowhere along the value chain are taxes and royalties consistently paid and much of the industry, in all countries, is in the hands of criminal networks.
All artisanal and most small-scale mining (ASM) is illegal in South Africa, by definition. The basic mining law, the Mineral and Petroleum Resources Development Act (MPRDA) of 2002, simply fails to mention artisanal mining and treats small-scale miners in the same way as large mining companies (in itself an incentive to informalisation). This regulatory gap is to be filled by legislative amendment and to this end an Artisanal and Small-scale Mining Policy was published at the end of March 2022.
Steel industry backs temporary ban on metal-scrap exports (Engineering News)
Members of the South African Iron and Steel Institute (SAISI) have come out in full support of the proposed six-month ban on the export of scrap metal from South Africa. SAISI members include ArcelorMittal South Africa, Cape Gate, Columbus Stainless, Force Steel, Scaw Metals, SA Steel Mills and Unica Iron and Steel, while Safal Steel and Grinding Media are affiliated members.
Senior African Development Bank officials recently undertook a three-day business mission to Zimbabwe. The bank’s vice president for power, energy, climate and green growth, Dr Kevin Kariuki, and its vice president for private sector, infrastructure and industrialization, Mr. Solomon Quaynor, both met with senior Zimbabwean government officials and business leaders in Harare last week. Discussions covered developing the private sector and ways Zimbabwe could best tap its renewable energy resources.
Energy and Power Development Minister Soda Zhemu said: “The government of Zimbabwe appreciates the African Development Bank’s support and involvement, particularly in the Kariba Dam Rehabilitation project ($32 million), the ZimFund Emergency Power Infrastructure Rehabilitation project ($59.5 million), the Alaska-Karoi Transmission Reinforcement project ($19 million) and the Energy Sector Reform Support project ($3.5 million).”
Ncube underscored the Zimbabwe government’s progress in tackling the economy’s structural and fiscal bottlenecks. He also noted the importance of the private sector.
Women breaking gender barriers in supply chain (Business Daily)
Kenya’s supply chain industry remains predominantly a ‘boys club.’ For most companies, entry-level workers would be equally divided by gender, but the share of women heading supply chain departments drops at every succeeding level. But now there is a remedy. In September 2021, the African Women in Supply Chain Association (Awisca) recognised 100 women in Africa for their exemplary work.
This will become an important platform that will boost the visibility of women in the sector, and amplify their work as they continue to break barriers.
A report by John Lewis Partnership published in 2021 found women are concentrated in the lower cadres of the supply chain with 58 percent in garment and textile industries and 53 percent in tea and flower plantations.
“It is true that we have more women at the middle level in the supply chain, especially in the public service. Women tend to shy away because it becomes noisy as you go up, and are more susceptible to bruising battles as you get into areas where there is likely conflict of interest. This discourages women from going higher up,” Ms Murichu says.
Nigeria lags behind African peers in exports (Businessday)
Nigeria, Africa’s largest economy, is lagging behind its peers on the continent as its struggles to ramp up exports. Its total exports as a percentage of Gross Domestic Product in 2021 was 26 percent, the highest since 2011 when it was 32 percent. As of 2021, the country’s GDP stood at $440.7 billion, according to World Bank data. However, some other African countries, although with smaller GDPs, such as Morocco, Angola, and Ghana, except South Africa, the second biggest economy on the continent, have been able to boost the contribution of exports to their GDP.
Muda Yusuf, CEO of Centre for Promotion of Private Enterprise, said Nigeria’s large economy should be an advantage to the country as its export component should be bigger. “Our export sector is still extremely weak,” he said.
The total trade in 2021 was N39.8 trillion, up 57.6 from N25.2 trillion in 2020. Exports rose by 43.8 percent to N18 trillion in 2021, less than imports, which were N19.5 trillion in 2021, up 70 percent from N11.5 trillion in the previous year, according to the National Bureau of Statistics. This shows that Nigeria recorded a trade deficit of N1.9 trillion in 2021. However, in the first quarter of 2022, Nigeria recorded a trade surplus of N1.2 trillion as exports totalled N7.1 trillion while imports totalled N5.9 trillion. According to Tajudeen Ibrahim, director, research and strategy at Chapel Hill Denham, Nigeria has to develop its power sector and infrastructures to encourage more production of goods that can be exported.
“If we work on power and our road network, it is likely that we gain momentum in terms of exports,” Ibrahim said. “Nigeria has to ensure that finished goods, which are value-added, have to be exported more rather than just raw materials.”
South Sudan to create jobs with fruits and vegetables strategy (ZAWYA)
On 8 August 2022, the Government of the Republic of South Sudan officially launched its first development strategy for the fruits and vegetables sector to boost the country’s agricultural gross domestic product (GDP) and create jobs for youth and women.
The International Trade Centre (ITC) has provided technical assistance in designing the strategy as part of its Jobs Creation and Trade Development Project, an EU-funded project focusing on creating quick-win economic and employment opportunities for micro, small and medium-sized enterprises in the fruits and vegetables value chains. The strategy will ultimately foster vibrant, resilient and sustainable food systems, inclusive growth, and job creation.
“This strategy provides a clear market-oriented vision, a framework for collaborative action and pragmatic and realistic recommendations. But it is only the first step: a good strategy is one that gets implemented and generates results,” said Darius Kurek, Senior officer for export strategy at the International Trade Centre.
The global production of fruits and vegetables has increased consistently over the last few years to cater to the growing world demand. In 2020, the worldwide production of fruits was estimated at approximately 887 million tonnes, while the production of vegetables was estimated at approximately 1.14 billion tonnes. With South Sudan’s conductive climatic and soil conditions for fruit and vegetable cultivation, the sector has potential for development, offering market opportunities in the region and globally, especially for women and youth who are forced to move to urban areas in search of jobs.
Gov’t is poised to addressing geo-political, economic challenges - Finance minister (Gambia News)
He made these remarks while delivering a speech during the joint launching of two agricultural projects held recently at Sir Dawda Kairaba Jawara Conference Centre. Organised by Central Project Coordinating Unit (CPCU) under the Ministry of Agriculture, the total for the two projects is valued at US$56 million and is to be implemented within five years across the country.
The duration of the Gambia Inclusive and Resilience Agriculture value chain development project GIRAV is from 2022-2026 and funded by the World Bank at a tune of US$40 million grant while the Global Agriculture and Food Security Programme otherwise known as Global GAFSP receives funding of the Gambia Agriculture and Food Security Project (GAFSP) to the tune of US$16 million with the African Development Bank (AfDB) as the Supervising Entity. The objective of the projects is to support and promote the development of inclusive, resilient, and competitive market oriented agricultural valued chains with specific focus on smallholder farmers and agri-business.
Among the expected results, is to contribute to improved market access, increase sales and competitiveness and also increase productivity and resilience to climate change.
Liberia experienced a strong economic recovery in 2021. Growth is expected to soften to 3.7 percent in 2022, largely due to heightened global uncertainties and commodity price shocks, which are pushing inflation into the double-digits. Liberia ‘s COVID-19 vaccination program has accelerated in recent months, but pandemic-related risks, including a potential outbreak of new variants, remain. The upcoming political cycle with presidential and parliamentary elections, scheduled for September 2023, is another source of uncertainty.
Waiting for Ethiopia: Berbera port upgrade raises Somaliland’s hopes for trade (The Conversation)
Berbera port is the main overseas trade gateway of the breakaway Republic of Somaliland. The port city is located on the Gulf of Aden – one of the globally most frequented seaways connecting the Indian Ocean and the Mediterranean. Only a few years ago, Berbera port was a dilapidated runway, originally built by the British empire, and then modernised first by the Soviet Union and later the US. The port is the lifeline of Somaliland, which imports most of what it needs, from food to construction material, cars and furniture. Its main export is livestock to the Arabian Peninsula. This picture changed considerably after the Emirates-based Dubai Ports World (DP World), a leading global port operator and logistics giant, took over the port management in 2017. It expanded the quay by 400m, established a new container terminal, designed a free zone, and started to manage the port’s operations.
Lined up alongside the quay are the latest crane models, which have become operational since June 2022. DP World employees practise operating the cranes every day. The hope is that the port will attract 500,000 TEU (unit of cargo capacity) per year, about one third of the capacity of neighbouring Doraleh port in Djibouti. This would allow Somaliland to become a logistical hub on the Gulf of Aden competing with other ports in the region such as Djibouti, Mogadishu and Mombasa.
The cranes are crucial for the speedy handling of cargo required in a modern port. The staff training, however, takes place in a port that is yet to get busy. So far, container ships arrive only infrequently.
African trade and integration
Reducing Africa’s food imports ‘hinges on effective value chain, sustainable tech’ (The New Times)
Africa’s food import bill has more than tripled, reaching an average of US$40 billion a year. Much of this imported food could be produced locally, creating much-needed jobs and incomes for the nations’ youth and smallholder farmers as well as improving food security on the continent. However, if Africa reversed the trend, the US$40billion that goes out of the continent is said to be able to bridge different gaps within the continent’s agricultural sector.
Trade wars: Farmers in Namibia, Botswana rejoice (Food for Mzansi)
The Southern African Customs Union (SACU) has taken a silent stance on Botswana and Namibia closing its borders to a number of fruits and vegetables imported from South Africa. But while South African farmers are pleading for intervention, farmers across the two borders say it will remove some unfair disadvantages they’ve had to contend with. The two countries, who form part of the SACU umbrella along with South Africa, says their respective bans are to protect local producers and form part of a bigger attempt to become self-sufficient in food security.
In an interview with Food For Mzansi, SACU spokesperson Kungo Mabogo states that the matter can only be addressed by the three countries bilaterally. “SACU only has a position when all SACU member states are involved, and they must form a common opinion. We cannot speak for Botswana, Namibia or South Africa as they are independent governments and have their structures,” he explains.
This comes after Christo van der Rheede, Agri SA’s executive director, appealed to agricultural minister Thoko Didiza and trade, industry and competition minister Ebrahim Patel. Van der Rheede has requested the ministers to intervene and to help ensure compliance with the SACU agreement.
East African Community Dither on Monetary Union, Casting Doubt on a Regional CBDC (BitcoinKE)
Central banks in the East African Community (EAC) are not achieving the targets the community set on the roadmap for a monetary union in 2024. Without such a monetary union which introduces a single currency, the likelihood of a regional Central Bank Digital Currency (CBDC) that has been discussed in the past is thrown into doubt. In April 2021, the community secretariat indicated that it was consulting on the feasibility of a CBDC as it sought enhancements for the upgrade of the East Africa Payments System (EAPS).
According to a report by the East African publication, the East African Community Monetary Affairs Committee (MAC) has indicated that several challenges exist that could still impede the timely implementation of its common monetary protocol for the 6 countries despite some progress.
Among the major achievements made by the respective central banks include the creation of key institutions of the East African Monetary Union (EAMU), and harmonization of monetary and exchange rate policies
Annual COMESA Women Trade Fair starts in Kampala (New Vision)
Women in business from 21 countries across Africa have joined their counterparts in Uganda to participate in the 3rd Annual COMESA Women Trade Fair that started Wednesday at the Uganda Museum in Kampala. Speaking during the opening ceremony, Connie Kekihembo, the Chief Executive Officer, Uganda Women Entrepreneurs Association Limited (UWEAL) noted that the trade fair and exhibition comes at a time when women like their male counterparts are recovering from the impacts of COVID-19 which ravaged businesses across the country. ”We are glad that this year the trade fair is taking place, of course as you all know we were interrupted by COVID-19 but now we are focusing on the road to recovery. We are offering our women a platform for policy dialogue on strategies to address barriers constraining women and youth entrepreneurs from maximizing opportunities for regional and cross-border trade.’’
The three-day event started with a panel of experts discussing the role of government, civil society and financial institutions in positioning Women SMEs to benefit from the African continent. The trade fair will be officially opened on Thursday by Vice President Jessica Alupo.
‘Optimise $13bn trans-Saharan gas pipeline project’ (New Telegraph)
The Major Oil Marketers Association of Nigeria (MOMAN) and Independent Petroleum Marketers Association of Nigeria (IPMAN) have urged the Federal Government to optimise the opportunities inherent in the $13 billion trans-Saharan gas pipeline project that could send up to 30 billion cubic metres a year of supplies to Europe.
The Executive Secretary and Chief Executive Officer of MOMAN, Mr Clement Isong and the National President, IPMAN, Alhaji Debo Ahmed, in separate interviews with New Telegraph, said the trans-Saharan gas pipeline project was a welcome development. They added that if maximised, it would transform Nigeria and the international community. According to them, the project will provide an international market for Nigeria’s abundant gas resources and increase the country’s foreign exchange earnings. Nigeria, Algeria and Niger signed a Memorandum of Understanding (MoU) to build a natural gas pipeline across the Sahara Desert.
Sylva recently said the value of Nigeria’s proven gas reserves of about 206.53 trillion cubic feet was over $803.4 trillion and a potential upside of 600TCF of gas, adding that Nigeria has the most extensive gas resource in Africa. Isong described the $13 billion trans-Saharan gas pipeline project as an ambitious project, adding that such was needed to pull Nigeria out of its present economic doldrums.
Russia to Supply Nigeria, Others Major Agricultural Products (Business Post Nigeria)
Russian Agriculture Ministry’s Agroexport Federal Center for Development of Agribusiness Exports in close partnership collaboration with Trust Technologies and the business expert community drew up a concept for the development of exports of major agricultural products (grain, dairy, butter, meat and confectionery products) to promising markets of African countries. The goal of the project is to prepare a practice-oriented model for increasing supplies and enhancing the competitiveness of Russian agricultural goods in the African market.
According to the business concept report, nine African countries have been identified and chosen as target markets for the delivery of agricultural products. These are Angola, Cameroon, Ethiopia, Ghana, Kenya, Mauritius, Nigeria, Tunisia and South Africa.
These countries account for 40% of the continent’s population and one-third of all African imports of agricultural products. According to ITC Trade Map, the total volume of imports of agricultural products in these countries in 2021 amounted to almost $33 billion.
“Africa is the future”: all eyes turn to the youngest continent as the next frontier for growth (Trade Finance Global)
In recent weeks the spotlight has fallen on Africa, with Russia and America choosing to renew ties with the continent via official visits to key states. As part of his second tour of Africa since taking office, US Secretary of State, Antony Blinken, gave a speech to students at the University of Pretoria, South Africa on 8 August, in which he outlined the Biden administration’s foreign policy, declaring that “Africa is the future.” As the world’s youngest continent, with a median age of 20 years and 60 % of the population under the age of 25, Africa has the potential to shape geopolitics and world economics in the decades to come.
For one, it signals major opportunities for economic growth. However, it could point to greater economic challenges and more political uncertainty if key problems such as famine, climate change, and infrastructure problems are not addressed.
With commodities like food and energy resources scarcening in the face of climate change and the Ukraine-Russia conflict, all eyes are turning towards Africa as a possible solution.
Recognising this, Blinken said that America’s strategy is centred around five key aims: To enhance US-Africa trade ties; Halt climate change; Help the region get a handle on COVID-19; Promote democracy Help build more peace and security across the continent
Aside from issues such as global food security, which have been exacerbated by the Russia-Ukraine conflict (Africa imports a large proportion of its staple grains from the region). Many believe that America’s desire to increase trade with the continent may be related to energy (Nigeria is a major oil-producing nation).
China investment supports African supply chain development: report (Capital Business)
The China-Africa Business Council (CABC) released a new report about China’s investments in African countries on Tuesday and said the two sides have made great strides in all-around, multi-level and wide-ranging cooperation over the past 22 years. Senior officials at the Council said Chinese companies have been a positive and productive part of the African market.
This year’s report shows that Chinese companies are committed to investing in the five key drivers of the African supply chain: production, inventory, location, transportation and information. It also gives 12 examples of how Chinese and African firms support African supply chain development.
According to the report, China’s engagement with Africa has risen rapidly in recent decades. China is Africa’s fourth largest investor and has been Africa’s largest trading partner for 13 years.
“Africa is highly dependent on the rest of the world. And in terms of its own supply chain, it’s just not developed enough,” said Hannah Ryders, CEO of Development Reimagined, adding that “we have the African continent free trade area, which came in 2021, which is a great development despite COVID-19.”
“Of course, there is an opportunity for China-Africa trade to continue to grow if there is investments in supply chains,” stressed Hannah.
Belt and Road Initiative transforming Africa’s development landscape: experts (Xinhua)
Experts and scholars said Wednesday that China’s Belt and Road Initiative (BRI) has contributed immensely toward transforming Africa’s developing economies through infrastructure development, unemployment reduction and improved trade, among others. They made the remarks while speaking at a one-day virtual forum, titled “The importance of China’s Belt and Road Initiative to Africa.”
“China is not here to exploit Africa as the western world perceives, because looking at the African infrastructure development side, the BRI is helping Africa to transform itself. China comes with the help Africans need,” said Frederick Golooba Mutebi, a Ugandan independent researcher and analyst.
“China through Belt and Road Initiative has come at the right time when Africa is in critical need of infrastructure development and improved global trade opportunities,” said Mutebi.
Mustafa Hyder Sayed, executive director of the Pakistan-China Institute said: “Through Belt and Road Initiative, roads, railways, bridges, hospitals, schools and airports among others, have been constructed in Africa, which has boosted trade, increased job creation, improved transport services and education and health among African countries,” he added.
Zha Daojiong, professor of international political economy at the School of International Studies and Institute of South-South Cooperation and Development with Peking University, China
“China’s Belt Initiative has provided a platform to low and middle-income economies in Africa to register significant growth in terms of infrastructure development, job creation and improved trading opportunities,” he added.
China locks out Kenya from new debt relief deal (The East African)
The elevation of Kenya to the middle-income status saw China lock the country out of a new list of African nations that will receive a Beijing debt relief this year, under a plan by the world’s second-largest economy to help 17 poor states in the continent saddled with its huge loans forego their repayments.
The deal announced last week will see Beijing forgive 23 matured interest-free loans for 17 unnamed African countries, which are classified as least developed countries.
Beijing made the announcement during the Forum on China-Africa Cooperation that seeks to boost ties between China and its African allies. Chinese Foreign minister Wang Yi said at the forum the debt relief plan “demonstrates China’s commitment to fostering stronger economic ties with the African continent”.
Chinese authorities in Nairobi said Wednesday Kenya was left out of the deal as it is classified as lower-middle income, which the new Beijing scheme does not apply to.
Kenya, which is East Africa’s largest economy, joined the league of the world’s lower middle-income nations in 2014, having crossed the United Nations’ $1,045 gross domestic product (GDP) per capita threshold after rebasing its economy. China, which accounts for about one-third of Kenya’s 2021-22 external debt service costs, is the nation’s biggest foreign creditor after the World Bank.
Kenya faced a deteriorating cash-flow situation, marked by falling revenues, worsening debt service obligations, and the effects of the Covid-19 pandemic. The debt burden has recently been compounded by the economic turmoil unleashed by the war in Ukraine but Kenya has never defaulted on its obligations.
Africa recorded US$4.2 bln surplus in trades with Japan in 2021 (Ecofin Agency)
Trade between Japan and African countries rose by 74% year-on-year in 2021. The feat was achieved thanks notably to border re-openings after Covid-19. With the eighth Tokyo International Conference on African Development just days away, Japan and Africa seek ways to build on this momentum. In 2021, Africa recorded a US$4.2 billion trade surplus in its dealings with Japan. This is the conclusion from the foreign trade statistics published by the Japan External Trade Organization (JETRO).
According to the statistics seen by Ecofin Agency, trades between Japan and Africa reached US$23.5 billion, up by 74% compared with the US$16.5 billion recorded in 2020, at the height of the Covid-19 pandemic. Africa’s exports from Japan reached US$13.9 billion while its imports were estimated at US$9.6 billion.
Although Japan’s trades with Africa have grown tremendously during the period under review, it is still moderate compared with African countries’ trades with countries like China (US$137 billion in H1-2022). To improve its relations with Africa, in the past few years, Japan has taken several initiatives to gain more shares from China, which is currently Africa’s leading trade partner. From August 27 to 28, it will organize the eighth Tokyo International Conference on African Development (TICAD-8), which will bring together African business leaders and decision-makers in Tunisia.
At a time when foreign partners, including Russia, the USA, and the UK, have renewed actions to conquer market shares in Africa, the Japan International Cooperation Agency (JICA) has announced talks with the AfCFTA secretariat to maximize the benefits of this trade agreement.
Japan Seeks ‘Sustainable World’ In Africa Aid Forum (Barron’s)
With its stated purpose to “create a sustainable world together”, Japan on Saturday kicks off its aid conference for Africa, where rival China has invested heavily in recent years. The eighth Tokyo International Conference on African Development (TICAD8) comes against the backdrop of China’s rising influence, cemented on the continent by its “Belt and Road” infrastructure initiative. A “complex” international environment caused by issues including “the situation in Ukraine” surrounds the meeting in Tunisia’s capital, the Japanese foreign ministry said.
With a view to “accelerating Japanese investment in Africa”, the conference will focus on three pillars: economy; society; and peace and stability, according to the official presentation. With more than $130 million already set to be delivered in food aid, Japan will also provide assistance for “rice production and food security” in view of the food crisis worsened by the Ukraine war.
UK-backed Africa Infrastructure Fund plans to raise $500m (Engineering News)
Emerging Africa Infrastructure Fund plans to raise as much as $500 million over the next three years to invest in infrastructure projects on the continent. The EAIF needs the new capital to embark on its next growth phase, said Martijn Proos, director at London- and Johannesburg-listed firm Ninety One, which manages the fund. “We are open to Africa, we are open for business where there are good opportunities,” he said in an interview.
Global economy
Regional liner squeeze takes harsh toll on developing nations (Splash247)
Regional liner trades are being squeezed further with the impact of higher freight rates on consumer prices five times stronger in many less well connected countries. “It is obvious that carriers have continued to shift relatively small vessels from regional trades to East West or big North South services to take advantage of the high freight rates,” Alphaliner stated in its most recent weekly report, returning to a topic that has been covered repeatedly over the past two years.
Jan Hoffmann, head of the trade logistics branch at the United Nations Conference on Trade and Development (UNCTAD), said the shift of tonnage to the bigger tradelanes was hurting smaller and developing countries. Capacity, price and service quality of regional trades is highly dependent on what happens in other trades and jurisdictions. “As capacity is redeployed, small island states and least developed countries are confronted with higher freight rates and lower connectivity,” Hoffman told Splash.
UNCTAD calculations show that the impact of higher freight rates on consumer prices is five times stronger in small island states than the world average. UNCTAD’s simulation shows a 1.6% increase of global consumer prices caused by the higher container freight rates, vis-à-vis an 8.2% increase in small island developing states.
Flagship UN conventions support LLDC post-pandemic recovery (IRU)
Zakharenko reminded participants that all landlocked developing countries in Eurasia acceded to TIR several decades ago and keep benefiting from cross-border trade and transport facilitation, while improving the resilience of their supply chains and maintaining the required level of security for transport operations. “IRU encourages LLDCs from Africa and South America to ratify and make full use of the existing UN conventions, such as TIR and its digital tools and e-CMR, which have been identified by the UN Secretary General as important instruments to address the challenges and impacts of the pandemic,” Zakharenko added. Key recommendations and outcomes of the conference have been summarised in the Awaza Statement adopted by the delegates.
Europe searches for alternatives in fertiliser supply battle (EURACTIV)
The battle for fertiliser, a vital commodity for food production, has emerged as one of the by-products of the Russia/Ukraine conflict, leaving states in Europe and elsewhere scrambling for alternative suppliers. Though alternatives exist there is no obvious quick fix. “Gas is a major raw material for fertiliser’s production, and Europe imports almost 40% of the latter from Russia” Jacob Hansen, Director General of Fertilizers Europe, told EURACTIV. Hansen’s association represents mineral fertiliser manufacturers in the EU.
One of the few viable alternatives to Russian fertiliser is Morocco, which already accounts for 40% of Europe’s imports of phosphate. That could increase substantially in the coming months and years. During the first quarter of 2022, Morocco’s state-owned OCP group, the country’s phosphate rock miner and phosphoric acid manufacturer and fertiliser producer, recorded a turnover of €24bn – up by 77% compared to last year, over the same period, OCP officials have indicated that production could increase by 50% over the next four years.
Related News
tralac Daily News
Local news
Scrap metal export ban to buy time for SA to build systems to tackle illegal activity (Engineering News)
The proposed policy to ban the export of waste, scrap and semifinished metal products for a period of six months is necessary to immediately reduce the ability of criminal syndicates to monetise stolen metals, while registration systems are put in place to hamper their ability to mask stolen metals within legitimate metal trade, Trade, Industry and Competition Minister Ebrahim Patel has said.
“The ban is temporary. In this period, the domestic market will provide some market for product. When the [regulatory and registration] system is fully developed, then such scrap that has been legitimately and properly obtained and can be explained can be exported,” Patel assured committee members. The new policy regime is intended to challenge the criminal syndicates’ ability to operate, sell and export stolen metal, he emphasised.
Wool industry welcomes government cooperation in overcoming export ban (Engineering News)
Agricultural business chamber of commerce Agbiz, federation of agricultural organisations AgriSA and the National Wool Growers’ Association of South Africa (NWGA) have welcomed an agreement between the South African government and the government of China to lift a ban on South African wool exports. Agbiz says the decision is a welcome development within the context of an increasingly volatile environment for international trade.
Private sector urges state to act on high cost of doing business (Kenya Broadcasting Corporation)
The government is determined to address the high cost of doing business in the country as a measure to spur regional trade. East African Community Principal Secretary Kevit Desai says the move is intended to make the country more attractive and competitive for local and international investors.
He said there is need to reduce the cost of doing business in the country to facilitate local and foreign investments. The PS says Kenya being the hub for regional and international trade is pushing to tackle barriers to trade by streamlining its import and export processes through implementation of reforms geared to addressing the high trade costs besides cumbersome and time-consuming border procedures.
Kenya: US diaspora remittances drop (Business Daily)
Diaspora remittances from the United States have fallen by a monthly average of three percent this year, reflecting the sharp cost of living in the world’s largest economy which has cut the disposable income available to Kenyans for support of relatives back home. A Central Bank of Kenya (CBK) breakdown of remittances by source country shows that inflows from the US fell to $183.4 million (Sh21.9 billion) from $221.5 million (Sh26.5 billion) in December 2021.
“Furthermore — looking from the recipient perspective — the CBK survey on diaspora remittance had listed real estate investment as a major use of the remittance flow. As such, the wait-and-see attitude in the run-up to the election coupled with runaway construction costs also waded the remittance inflow towards real estate investment.” The US is the biggest source of remittances to Kenya, accounting for 59 percent of the total sum of funds sent into the country this year. As a result, the direction of total inflows largely mirrors the performance of the US source market.
UK protests Kenya ban on second-hand buses, trucks (Business Daily)
The United Kingdom has protested Kenya’s impending ban on second-hand imports of buses and trucks, fearing the embargo will cut the flow of used commercial vehicles from the European country. Betty Maina, the Industrialisation and Trade secretary, says the UK authorities are uncomfortable with the sanction on used vehicles, which was set to take effect from July 1 before it was frozen in court. An escalation of the differences between Kenya and Britain could affect the flow of goods between the two nations.
Kenya and Britain inked a fresh trade deal in December 2020 allowing duty-free access of Kenyan goods to the UK market and avoid a post-Brexit disruption. The protest will be handled by the Kenya-United Kingdom Economic Partnership Agreement (EPA) Council, Ms Mainda said.
The EPA Council is made up of ministerial representatives from both countries tasked with ensuring smooth implementation of the trade deal, which came into force in March 2021, including ironing out trade disputes.
Nairobi signed the strategic trade deal with London on behalf of the seven-nation East African Community (EAC) on December 8, 2020, before its coming into force on March 23, 2021, after ratification by respective parliaments. The trade pact preserved duty- and quota-free access to the UK for Kenya’s largely agricultural produce such as cut flowers, coffee, tea, fruits and vegetables after Britain left the 27-member European Union trading bloc. The deal, however, provides a window of seven years after ratification by the Kenyan and UK parliaments for non-agricultural goods from the UK to start enjoying preferential import duty.
Sugar imports drop on improved production (Business Daily)
Sugar production between January and July increased by 15 percent when compared with a similar period last year, compelling the sector regulator to cut imports by nearly half last month. Data from the Sugar Directorate shows that the volume of the commodity produced hit 480,849 tonnes in the review period up from 418,799 in the corresponding time last year. The increase saw the directorate limit the imports in July to 9,394 tonnes from a high of 17,200 tonnes a month earlier, representing a 46 percent decline.
“Cumulative sugar production from January to July 2022 was 480,849 tonnes, up from 418,799 tonnes in the same period last year, representing an increase of 15 percent,” said the directorate. Sugar imports have been on a constant decline since March on the back of better production locally boosted by a steady supply of the raw material.
Nigeria exports N1.77trn products in 6months – NEPC (Daily Trust)
The Nigerian Export Promotion Council (NEPC) has disclosed that the country exported products worth N1.77 trillion from January to June 2022 to different parts of the world.
“The non-oil sector recorded a significant growth in non-oil export as a total of 4.146 billion metric tons of products worth $2.593 billion were exported between January and June 2022 and the figures were culled from the non-oil export performance reports of various shipment inspection agents who are appointed by the federal government to determine volume, value and destination of Nigeria’s non-oil exports”
The executive director added that Urea and fertiliser as well as cocoa beans were some of the top products exported.
Nigeria moves to partake in USD$175bn carbon trade market (Vanguard)
Nigeria has taken its first major step towards benefiting from the over USD $175 billion per annum carbon trade with the development of Nigeria’s Emission Trading Framework. The Minister of Environment, Barrister Mohammed Abdullahi, gave this indication while initiating the development of a national emissions framework, in Abuja, on Tuesday.
“At COP 26 in Glasgow, H.E. President Buhari announced Nigeria’s Net Zero target of 2060, making Nigeria the first major developing country and the first in Africa to undertake such a commitment. “His speech marked the beginning of a road map signaling to the international community that while greater responsibility is on the developed world, Nigeria is committed to providing leadership in climate governance both regionally and internationally.”
Ethiopia: Free Trade Zone Will Provide Efficient Services, Attract Investors: Maritime Authority (ENA)
Modern and suitable services will be provided at the Dire Dawa Free Trade Zone to improve import-export trade and attract investment, according to Ethiopian Maritime Authority. The recently inaugurated Ethiopia’s first free trade zone is expected to reduce logistics time and cost, improve efficiency and trade competitiveness, attract more FDI, boost industrialization and the economy.
Logistics Transformation Office Deputy Director at the authority, Ewnetu Taye told ENA that the location of the free trade zone will significantly reduce the current time and cost of logistics and improve import-export trade as well as attract many partners and investments.
“We hope the free trade zone under establishment will have many partners because a free trade zone requires huge investment, sophisticated knowledge, huge capital, and foreign currency.” According to him, foreign currency, easy customs and improved logistics services will be provided at the Dire Dawa Free Trade Zone. “This will attract foreign investors and stimulate FDI.”
Manufacturers in the existing industrial park, importers and service providers, especially logistics service provider companies are expected to invest, he added.
African trade and integration
EAC states challenged on trade agreements (New Vision)
The East African Community (EAC) partner states have been challenged to increase their volume of transactions under regional and international trade agreements.
The region’s private sector trade block, East Africa Business Council, said it is imperative for the region to take advantage of opportunities such as the African Continental Free Trade Area (AfCFTA), African Growth and Opportunity Act (AGOA), Economic partnership agreement, to advance trade within the EAC.
According to the EABC chairperson, Angelina Ngalula, the region has not fully exploited the trade agreements to its advantage, due to challenges such as low productive capacity, fragmentation and poor infrastructure. ”With the AfCFTA, there are no boundaries of doing business in Africa, so the EAC bloc should be well-prepared to export competitive professional services and skills to the continent. The regional governments should therefore come in to address some of the roadblocks in the way of achieving this,” she said.
EABC, COMESA, SADC Establish African Tripartite Business Councils (East African Business Week)
The East African Business Council, COMESA and SADC Business Council have officially launched and formed the African Tripartite Business Council to spearhead the inclusion of private sector policy proposals into the negotiations of African Continental Free Trade Area (AfCFTA) Agreement and the African Tripartite Free Trade Area (TFTA).This is one of the resolutions from the consultative meeting of regional business councils on the implementation of the African Continental Free Trade Area (AfCFTA) agreement organized by the East African Business Council (EABC) with support from TradeMark East Africa (TMEA).
“The African Tripartite Business Council will put forward joint private sector policy positions to the AfCFTA secretariat in Ghana and tripartite ministerial council meetings in order to accelerate the implementation of the agreements,” said, Mr. John Bosco Kalisa, EABC CEO.
Kalisa called upon the member states from COMESA, the East African Community (EAC) and the Southern Africa Development Community (SADC) to ratify the Tripartite Free Trade Area to achieve the threshold of 14 ratifications required to enable the agreement to enter into force.
Speaking at the same meeting , Dickson Poloji, the CEO of COMESA business council said, it is vital for the private sector to be knowledgeable of the trade instruments of rules of origin, standards and dispute settlement mechanism under the AfCFTA, if they are to benefit from the economic block.He elaborated that the implementation committees of the AfCFTA should be co-chaired by the private sector.
Presenting paper on the role of ICT in promoting regional trades , Ms. Nadia Uwamahoro, managing director, data systems urged for the finalization of the AfCFTA protocol on digital trade to promote youths and the emergence of African owned e-commerce platforms.
African Development Bank Optimistic about Economic Prospects for Southern Africa Region (African Business)
The Southern Africa region’s investment opportunities and prospects for economic growth are encouraging despite recent headwinds of a global pandemic and food crisis, the African Development Bank’s (www.AfDB.org) Senior Vice President Swazi Tshabalala has said. Tshabalala attended the 42nd Ordinary Summit of Heads of State and Government of the Southern African Development Community (SADC) which closed in the Democratic Republic of Congo’s capital, Kinshasa last week.
Tshabalala said: “The African Development Bank Group is highly optimistic about the future of the SADC region. Although the pandemic and food crisis challenged the region in ways no one expected, regional cooperation in investment, security, infrastructure, health, climate, agriculture, and trade is accelerating at an impressive pace. Those trends are creating new opportunities to strengthen the region’s productive systems and to upgrade urban and regional infrastructure.”
UN to help Africa develop capital markets to spur economic development (Xinhua)
The United Nations said Tuesday that it will help African countries to develop their capital markets to accelerate economic development. Sonia Essobmadje, chief of the Innovative Finance and Capital Markets Section with the Private Sector Development and Finance Division at the United Nations Economic Commission for Africa (UNECA), told Xinhua in Nairobi, the capital of Kenya, that capital markets in the continent are underdeveloped which limits the funding available for the private sector and public projects.
“Well-developed capital markets will also act as a gateway for foreign capital seeking investment opportunities in Africa,” Essobmadje said on the sidelines of the conference on sustainable capital markets development in Africa.
Expert Group assess Africa’s progress in meeting the Sustainable Development Goals and Agenda 2063 (UNECA)
The Experts Group Meeting to review and validate the draft 2022 Africa Sustainable Development Report will be held from 30-31 August 2022 in Windhoek, Namibia. The report assesses the progress and ongoing challenges faced by African States in meeting the Sustainable Development Goals (SDGs) and Agenda 2063. The report is jointly produced by the Economic Commission for Africa (ECA), in partnership with the African Union Commission (AUC), the United Nations Development Programme and the African Development Bank.
Ghana to host Pan-African AgriTech Innovation Hub in Accra (Ghanaian Times)
Ghana will host the Pan-African AgriTech Innovation Hub, a public-private partnership initiative dubbed “Timbuktoo”, aimed to mobilise and invest $1 billion of public and private capital for the next 10 years to build startup revolution in Africa.
The initiative championed by the United Nations Development Programme (UNDP) which was launched in 2021 seeks to engage a large number of private and public sector partners to establish eight Timbuktoo Hubs in recognised leading startup ecosystems, particularly in Accra, Nairobi, Cape Town, Lagos, Dakar, Kigali, Casablanca, and Cairo, among others. Addressing the gathering during TimXAccra event held in Accra on Friday, the UNDP Resident Representative to Ghana, Dr Angela Lusigi said the initiative would enable the youth in Ghana and across Africa to become world-class entrepreneurs, innovators, and problem solvers.
She said agriculture remained a key driver of Ghana’s economy, which contributed to export earnings, served as major source of inputs for the manufacturing sector and employed over 50 per cent of Ghana’s population.
According to her, despite the sector’s importance, productivity remained low and it was estimated that, only 50 per cent of the country’s 13.5 million hectares of land was currently under cultivation.
African countries eye 2030 start for generating nuclear energy (The East African)
At least seven African countries are at various stages – commissioning, shopping for vendors and mapping appropriate sites – in the roll-out of nuclear power plants, as a majority eye 2030 as a start-date for generating electricity from nuclear energy. These include Egypt, Kenya, Uganda, Nigeria, Morocco and Rwanda.
South Africa’s Koeberg nuclear power station - owned and operated by state-run power utility Eskom – is the only nuclear power plant on the continent. It has an installed capacity of 1,940 megawatts. As more countries push on with the switch to low carbon electricity, South Africa has been eyeing an additional 10,000 megawatt in nuclear power capacity. However, there has been widespread opposition by an anti-nuclear lobby.
SADC to develop natural resources to create jobs and fight poverty (SADC)
The Southern African Development Community (SADC) intends to develop the many natural resources in the Region and encourage local transformation in order to create decent jobs for the youth and fight against poverty, SADC Chairperson, His Excellency Felix Antoine Tshisekedi, President of the Democratic Republic of Congo (DRC), has said.
The transformation will require the mobilisation of resources from within the Region, in addition to contributions from international cooperating partners and private and foreign investors. In this perspective, H.E President Tshisekedi encouraged SADC to reflect on the need to set up an industrialisation fund in order to finance industrialisation projects and programmes and get out of dependence on external partners. In this way, SADC will be able to achieve a major economic and technological transformation at national and regional levels towards the deepening of regional integration as advocated by the SADC Industrialisation Strategy and Roadmap 2015-2063.
H.E Tshisekedi called on Member States to work closely together to unlock regional value chains in key sectors such as agribusiness, mining and pharmaceuticals, in which the Region is richly endowed.
SADC has overcome a lot of challenges and its most recent areas of progress include the successful ratification of the African Continental Free Trade Area (AfCFTA) by Member States as a platform for advancing economic integration, and cooperation in the management of the COVID-19 pandemic in the face of anti-SADC COVID related policies in the global north.
H.E Chakwera said SADC’s most recent challenges include the wave of climate change related impacts that now regularly devastate Member States, and the difficult task of securing global support for mitigation and adaptation efforts.
The Southern African Development Community (SADC) Secretariat, in collaboration with the Alliance for African Partnership (AAP) and two of its (AAP) members, the Regional Network of Agricultural Policy Research Institutes (ReNAPRI) and the University of Pretoria (UP), will from 29th to 30th August 2022 convene a regional policy dialogue with key stakeholders to identify interventions that are necessary to build sustainable agri-food systems in the Region.
During this SADC-AAP Dialogue, participants will discuss collective action on the transition towards sustainable and climate-resilient agri-food systems for enhanced food security, ending hunger, and achieving climate objectives in the Region. The dialogue seeks to identify interventions to build agri-food systems’ resilience to shocks and stressors, towards achieving sustainable food security, poverty reduction and economic growth in the Region.
Globally, agri-food systems – basically defined as a series of activities and institutions around the production, processing, distribution, marketing, and consumption of a particular food item – are increasingly under pressure to meet the rising food demand and changing dietary preferences and, all this in the face of climate and economic shocks. This challenge is especially pronounced in Sub-Saharan Africa (SSA) , where food production will need to increase in the range of 60-80% in order to meet the projected three-fold rise in cereal demand and where the population is estimated to reach 2.2 billion by 2050. SADC is not an exception to this challenge as the Region faces a high population growth rate and demographic transition which will fuel growing food demand and rapidly changing dietary preferences, in a region that has limited growth of manufacturing and service sectors.
China’s help on Africa’s supply chain called crucial (China Daily)
China has played an essential role in Africa’s supply chain development by addressing related challenges, such as the COVID-19 pandemic and regional conflicts, and has helped improve socioeconomic development on the continent, African officials said on Tuesday. The remarks were made at a ceremony marking the release of a report published by the China-Africa Business Council on China’s investment in Africa. From a supply chain perspective, the report showcased efforts made by Chinese enterprises to improve Africa’s supply chain and support the independent and sustainable development of Africa.
Rahamtalla M. Osman, permanent representative of the African Union to China, said the Forum on China-Africa Cooperation and the Belt and Road Initiative are closely aligned with Africa’s development blueprint and strategies, such as the AU’s Agenda 2063 and the African Continental Free Trade Area. Deeper BRI and AfCFTA cooperation would play an important role in building a more integrated African continent as well as connecting Africa to global supply chains, Osman added.
He also said that by 2021, China’s trade with Africa had increased twentyfold, and its investment stock in Africa saw a hundredfold increase since 2000. More than 3,800 Chinese enterprises have invested in Africa, he added. “All of this has contributed to China-Africa cooperation in supply chain development.”
Global economy
Goods Barometer points to stagnating global trade growth (WTO)
The latest WTO Goods Trade Barometer issued on 23 August was steady but below the recent trend line for merchandise trade, suggesting that global goods trade continued to grow in the second quarter of 2022 but that the pace of growth was slower than in Q1 and is likely to remain weak in the second half of the year.
The volume of world merchandise trade plateaued with year‐on‐year growth slowing to 3.2% the first quarter of 2022, down from 5.7% in fourth quarter of 2021. The slowdown in Q1 only partly reflected the impact of the conflict in Ukraine, which broke out in late February. Lockdowns in China also weighed heavily on trade in the first quarter.
G20 International Trade Statistics: Trends second quarter 2022 (OECD)
G20 merchandise trade growth slowed markedly in value terms in Q2 2022, as measured in current US dollars. Exports and imports increased by 2.1% and 2.6%, respectively, as compared to 4.8% and 6.2% in the previous quarter. While high commodity prices, exacerbated by the war in Ukraine, continued to fuel merchandise trade growth in nominal terms, the slowing growth in value terms partly reflects the increasing value of the US dollar against other major currencies
G20 services trade growth slowed in Q2 2022, as measured in current US dollars. Exports and imports are estimated to grow by 1.1% and 2.2%, as compared to the slightly higher rates recorded in Q1 2022 (2.1% and 2.3%, respectively). Strong travel and transport supported growth across many G20 economies, while prolonged COVID-19 containment measures weighed on services trade in East Asia.
Commodity markets: evolution, challenges, and policies (World Bank Blog)
Commodity markets are constantly evolving, reflecting growth in population and income as well as changes in relative prices, technological advances, and government policies
Over the past half-century, prices of agricultural commodities, adjusted for inflation, have been on a long-term downward path, reflecting the increases in productivity and low-income elasticity of demand . In contrast, energy prices have risen since the early 20th century, as demand has increased in line with income, and suppliers have been forced to turn to less accessible sources.
The long-run trends in metal prices have been mixed, as their high-income elasticities of demand have led to a major rise in consumption, while extraction processes have been enhanced by ongoing technological progress, boosting supply.
Large shifts in the demand and supply of commodities, along with price booms and busts and differing long term trends, pose challenges for commodity-exporting emerging market and developing economies (EMDEs). Commodities are critical sources of revenue for almost two-thirds of EMDEs, and their macroeconomic performance is heavily linked to commodity price changes. Both oil and metal price shocks appear to have asymmetric impacts on economic growth in energy and metal exporters: Price increases have been associated with small, temporary accelerations in output growth while price declines have been associated with more pronounced or longer-lasting growth slowdowns.
Oil and gas companies should drive energy transition – Asharami COO (Daily Trust)
“Oil companies should be the ones driving the energy transition because if they allow others to do it, they will be out of business. So, the energy transition has to be driven by the oil and gas companies,” Henry Menkiti, a Sahara Upstream Company, said over the weekend. He spoke at the first edition of Sahara Group Media Thought Leadership Series, held at the group’s corporate head office in Lagos.
Achieving this will however require the active participation of the private sector, with the government providing the enabling environment through regulation and incentives.
While Africa has oil now, it must begin to prepare for the transition now because the current customers are already in the transition period, Menkiit said.
For Nigeria, the transition will be less disruptive given the country’s rich endowment of gas, which should serve as the transition fuel as Africa’s leading oil producer marches to the desired destination.
“The future of Nigeria’s energy industry will be a lot of individuals and companies; change will not come from the government. It will be from private individuals. The government can only come in via regulation,” said Menkiti.
WHO Director-General’s opening remarks at the Regional Committee side event on Fighting Substandard and Falsified Medicines in Africa: A Collaborative and Integrative Approach - 23 August 2022 (World Health Organisation)
The threat of substandard and falsified medicines. The magnitude of this problem, and its damage to both lives and to economies, is immense. Low- and middle-income countries are estimated to spend more than 30 billion US dollars annually on substandard and falsified medicines.
There are several reasons for the proliferation of substandard and falsified medicines. First, a lack of access to affordable efficacious and safe medicines forces desperate people to buy medicines from unreliable sources. Second, a lack of good governance allows corruption to penetrate health systems and leaves loopholes for criminal groups to exploit. Third, a lack of technical capacity undermines the integrity of supply chains and limits the ability of countries to safeguard the health of their people.
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Local news
‘SA Agri calls to lift import ban emotional, unbalanced’ (The Namibian)
Namibian government officials have called the recent claim that Namibia and Botswana should remove the import ban on some quota of fresh produce from South Africa an emotional one, and unbalanced. This includes agriculture minister Calle Schlettwein, who said South Africa also has import bans that no one has called on to revoke. This comes after South African farmers, through their representative organisation SA Agri, wrote to their agriculture and trade ministers Thoko Didiza and Ebrahim Patel to claim that Namibia and Botswana were violating the Southern African Customs Union (Sacu) agreement by imposing import bans on certain fresh produce.
The two countries started banning the importation of several fruits and vegetables in an attempt to protect and help local producers get access to markets, as well as achieve food security. Schlettwein said the reason why Namibia has an import ban is to promote self-sufficiency.
Zim explores West Africa export market (Chronicle)
Zimbabwe is keen to diversify its export market to West Africa with the national trade development and promotion organisation, ZimTrade, sending its team to explore trade opportunities in Senegal. Building on the earlier mission to explore the Ghana market in the same region, the mission outcome should determine products and services that Zimbabwean companies can export to Western African region. The market exploration is part of the country’s African Continental Free Trade Area (AfCFTA) focused efforts on reduced duty trade gains among African states.
“The purpose of the study is to determine Zimbabwean products and services with potential in Senegal, riding on opportunities that have been made available by the African Continental Free Trade Area,” ZimTrade chief executive officer, Mr Allan Majuru, said. “Targeting Senegal as a market is in line with the National Export Strategy, which seeks to diversify our export markets and grow Zimbabwe’s exports to non-traditional markets.”
How Kenya will gain from UK trade pact (Business Daily)
The United Kingdom (UK) has opened a window for Kenyan goods such as apparel and agricultural products to enjoy lower or zero tariffs despite being a lower middle-income economy. The UK this week listed Kenya’s neighbours among them Uganda, Ethiopia, Rwanda and South Sudan including other 65 developing countries as beneficiaries of a new bilateral trade deal that cuts import taxes on hundreds of products from some of the world’s developing countries to boost trade links. But it left out Kenya since it was upgraded from the group of the least developed countries.
But the new pact under the Developing Countries Trading Scheme (DCTS) has allowed the three countries including Uganda which is Kenya’s regional top trading partner, to import goods from Kenya and re-export them duty-free into the UK. Under the deal, Kenya’s neighbours which are classified as least developed countries or LDCs will be able to buy goods in Kenya and export the finished goods to the UK. “This means that LDCs are able to participate in value chains involving materials from 95 countries and still export their final products to the UK duty-free,” said the UK.
Lekki deep seaport set to create 112,000 jobs, berth largest ship in the world – Minister of Transportation (Nairametrics)
The Minister of Transportation, Alhaji Muazu Sambo, has disclosed that the Lekki Deep-Sea Port project would create 112,000 jobs for Nigerians upon its completion. Sambo stressed on the significance of the port as it has the capacity to berth the largest ships in the world. This was made known by the minister while having a chat with journalists on Sunday in Jalingo. Sambo said that the port, which was second in Nigeria after Onne Deep-Sea Port, has the potential to garner more revenues for the country.
He said, “The Lekki deep-sea port project, which is the second after Onne Deep Sea Port in Nigeria is very significant, because the largest ships in the world can berth at the Port. “That means, more tonnage, more cargo, more revenue for the port and for the country, more economic activities. “ And above all, more jobs, like I said, over 112, 000 both direct and indirect jobs will be created as a result of the creation of the Lekki deep-sea port.
Nigeria, India’s largest trading partner in Africa — Envoy (Vanguard)
The Minister of State for External Affairs of India, Vellamvelly Muraleedharan, has said Nigeria is India’s largest trading partner in Africa. This is even as he disclosed that Nigeria/India bilateral trade in the year 2021/2022, had risen to $14.95 billion.
According to him, Nigeria has always been a favourite investment destination for Indian Businesses, with India being the second largest providers of employment in Nigeria. “The large and growing population of Nigeria, its talented youth, the abundance of natural resources, a democratic and business friendly Government and very strong cultural bonds between our peoples have all fuelled the rising economic engagement between both countries.”
Ministry of trade implements National Export Dev Strategy (Ghanaian Times)
The Ministry of Trade and Industry is implementing a National Export Development Strategy, aimed at increasing Ghana’s non-traditional export revenue to US$25 billion by 2029. In this regard, 17 priority products, ranging from automobiles and vehicles, industrial salt and starch, sugar and processed oil seeds to aluminium, iron and steel and pharmaceutical products have been identified for export under the strategy.
According to a Deputy Minister of Trade and Industry, Herbert Krapah, the plan was being rolled out alongside the Export Expansion Programme expected to assist an initial 200 private firms in enhancing their productive capacity for export to the African market.
Morocco’s Startups Bring International Fleet Management Into the Digital Age (PYMNTS.com)
As a key facilitator of intercontinental trade, Morocco plays a critical role in the global logistics space. Home to Africa’s largest port by cargo capacity in Tangier Med, numerous shipping routes connect Morocco to Spain at the only land border between Europe and North Africa. This gives Morocco a unique position in trade corridors between the two regions. While the country’s maritime heritage is among the richest in the Mediterranean, in the modern era, freight networks extend over sea, road, rail and air, with importers and exporters increasingly expecting the seamless movement of goods between them.
Against this backdrop, a number of logistics tech startups have emerged from the North African country in recent years, with many of them specifically geared toward smoothing international shipping and managing cross-border freight transport between Morocco and its trade partners.
African trade and integration
ICYMI: Ghana, seven others to start trade under AfCFTA (Ghana News Agency)
Ghana and seven other countries will soon start exchanging goods and services under the African Continental Free Trade Area (AfCFTA). The move is part of efforts to diversify and increase export among African countries through Export Trading Companies (ETCs) while achieving the Continent’s industrialisation drive and make it economically self-reliant. Mr Herbert Krapa, Deputy Minister of Trade and Industry (MoTI), said this at a seminar to sensitise African countries on the role of ETCs in easing intra-African trade under the AfCFTA in Accra on Monday.
Mr Krapa said: “Actual trading is starting between Cameroon, Egypt, Kenya, Mauritius, Rwanda, Tanzania, Tunisia, and Ghana. In the coming weeks, the dream of our forebears will be off the ground.” He said the Secretariat had launched the AfCFTA Initiative on Guided Trade to translate all the progress on paper into action to make the continent’s industrial revolution and its ability for self-reliance attainable.
The Deputy Minister explained that ETCs would make Africa leave no one behind in the regional value chain particularly small and medium-sized enterprises (SMEs), young entrepreneurs, startups, light manufacturers as well as big industries. These value-chain players will be providing export and import services, warehousing, transportation, finance, insurance, risk management and market intelligence, around which the free trade area will thrive. He, therefore, encouraged Governments and private sector players to have the right policy, finance, institutional framework, productive capacity and infrastructure to enjoy the benefits that AfCFTA provided.
China to waive some Africa loans, offer $10bn in IMF funds (Engineering News)
China, the largest government creditor to emerging economies, said it will forgive 23 interest-free loans to 17 African countries and redirect $10-billion of its International Monetary Fund (IMF) reserves to nations on the continent. Foreign Minister Wang Yi announced the cancelations in a meeting last week of the Forum on China-Africa Cooperation, according to a post on the ministry’s website. It didn’t provide details on the value of the loans which it said matured at the end of 2021, nor did it state which nations owed the money.
Since 2000, Beijing has announced multiple rounds of debt forgiveness of interest-free loans to African countries, canceling at least $3.4-billion of debt through 2019, according to a study published by Johns Hopkins University School of Advanced International Studies. The canceled debt was limited to mature, interest-free foreign aid loans, with Zambia receiving the most cancellations over that period. However, the vast majority of China’s recent lending in Africa such as concessional loans and commercial loans have never been considered for cancelation, the report added, though some of it has been restructured.
The announcement last week highlights China’s efforts to build ties with developing nations, particularly through its Belt and Road Initiative. The US and China are competing for influence around the world, and Beijing’s announcement comes at a low point in ties between the two superpowers, with tensions rising following a visit to Taiwan by US House Speaker Nancy Pelosi earlier this month and Beijing’s support of Russia amid its invasion of Ukraine.
Inside Africa’s pitch at UN climate change conference (The East African)
“Act now” will be Africa’s clarion call at the COP27 as the continent intensifies calls for a just energy transition amid a worsening climate crisis. The “action” is likely to be seen more in the halls and offices of the world’s financing institutions than on the ground, however, as Africa battles with how to finance its energy requirements.E merging details show that African envoys will press heavily polluting, rich economies to offset the continent’s environmental damage from global warming with favourable financing packages.
Studies show Africa is most vulnerable to the effects of climate change with extreme weather like drought and flooding already becoming commonplace on the continent. It is on that premise that African governments want wealthier nations to make big investments in clean technology and infrastructure to support developing countries.
Africa is keen to obtain green technology that can reduce costs and increase competitiveness in the clean energy sector. “Africa must be given adequate time to transition and transform its energy infrastructure. We cannot transform abruptly. We need resources, capacity, technology transfer and finance to power our development,” Harsen Nyambe, the director of sustainable environment at the African Union Commission told Time.
This year’s Africa Climate Week brings together governments and key stakeholders from across the continent to “explore resilience against climate risks, the transition to a low-emission economy and the partnerships we need to solve these pressing challenges.” With so much at stake, it’s clear that we must make substantial investments and coordinated efforts in building transformative climate actions across Africa. This means advancing integrated holistic solutions that connect the dots between land-use, water management, agriculture and livelihoods, between energy, natural resources, economic growth and social development, and between disaster risk reduction, climate information services and resilience. This is what we call transformative climate action.
The pathway forward starts with people, but also requires resources, political will, policies and coordination to deliver the type of transformative action we need.
Medicine security: Counterfeit medicines undermine Africa’s progress (Businessday)
Counterfeit drugs are a deadly and growing problem globally, particularly in developing countries where supply chain security is limited, undermining progress towards meeting the Sustainable Development Goals (SDGs). The World Health Organization estimates that one in ten medical products circulating in developing countries are substandard or falsified.
The problem is rife within Africa with dire consequences. Of all the fake drugs reported to the WHO between 2013 and 2017, 42 percent of the reports came from the African region. In March 2019 alone, the WHO raised alerts for fake meningitis vaccines in Niger and fake hypertension drugs in Cameroon. Then, in August, falsified versions of the antibiotic Augmentin were discovered in Uganda and Kenya.
Counterfeit medicines have both health and economic consequences for the continent. They leach money from healthcare systems and kill thousands of people, mostly within vulnerable communities. However, from the counterfeiters’ point of view, this is a lucrative industry, with a global market worth roughly $200bn. Medicine counterfeiting has become an international operation involving many actors across different countries and sectors. It has become more lucrative than trafficking in hard drugs.
TICAD8 Meeting to advance Africa, Japan Cooperation (KT Press)
The eighth Tokyo International Conference on African Development (TICAD 8) is set to take place from August 27 to 28, in Tunis, Tunisia, and is expected to advance Japan and African countries cooperation. The high-level event brings together Heads of State and Government from Africa, Japan, the United Nations and the World Bank to engage in dialogue on issues related to economic growth, trade and investment, sustainable development, human security, and peace and stability in Africa. The meeting will focus on three themes; achieving sustainable and inclusive growth with reduced economic inequalities; realizing a sustainable and resilient society based on human security, and building sustainable peace and stability through supporting Africa’s own efforts.
Global economy
China’s coastal city Xiamen sees trade with BRICS countries up 20.7 pct (Xinhua)
Trade in goods of east China’s coastal city of Xiamen with BRICS countries reached 47.9 billion yuan (about 7 billion U.S. dollars) in the first seven months of this year, up 20.7 percent from the same period last year, according to the Xiamen Customs.
Xiamen’s exports with BRICS countries amounted to 15.3 billion yuan, while imports reached 32.6 billion yuan during the period, up 28.1 percent and 17.5 percent, respectively, year on year. Xiamen’s imports and exports with Russia, South Africa, and Brazil reached 14.8 billion yuan, 7.3 billion yuan, and 15.7 billion yuan from January to July, up 29.8 percent, 25.4 percent, and 23.3 percent, respectively, year on year.
Major imported goods during the period included metal ore and heavy mineral sand, agricultural products, coal, and lignite, while exports mainly included mechanical and electrical products and labor-intensive goods.
Wheat in developing countries to feel climate change impact (Food Business News)
Climate change could have more of a negative impact on low-latitude countries than on high-altitude countries, further widening the gap between the fortunes of wheat farmers in developed countries and wheat farmers in developing countries, according to research from China published Aug. 19 in the journal One Earth. The researchers developed a climate-wheat-economic ensemble modeling approach in which they looked at the impacts of climate mean conditions and extreme events on wheat yields, price and the global supply chain. The model assessed the impact of 2 degrees Celsius global warming on the global wheat supply and demand chain.
“With this change in yields, the traditional trade position of the wheat market could be deepened, and this may cause the wheat-importing regions located in low latitudes, such as Southern Asia and Northern Africa, to see more frequent and steeper wheat price spikes than wheat exporting countries,” said lead author Tianyi Zhang, an agro-meteorologist with the Institute of Atmospheric Physics at the Chinese Academy of Science.
“Agricultural trade liberalization accompanied by protection polices in developing countries would be beneficial for global food security in the threat of climate change,” the researchers said.
Millions Go Hungry: While Billions Worth of Food Go into Landfills (Inter Press Service)
The ominous warnings keep coming non-stop: some of the world’s developing nations, mostly in Africa and Asia, are heading towards mass hunger and starvation. The World Food Programme (WFP) warned last week that as many as 828 million people go to bed hungry every night while the number of those facing acute food insecurity has soared — from 135 million to 345 million — since 2019. A total of 50 million people in 45 countries are teetering on the edge of famine. But in what seems like a cruel paradox the US Department of Agriculture estimates that a staggering $161 billion worth of food is dumped yearly into landfills in the United States.
The shortfall has been aggravated by reduced supplies of wheat and grain from Ukraine and Russia triggered by the ongoing conflict, plus the after-effects of the climate crisis, and the negative spillover from the three-year long Covid-19 pandemic.
Nutrition and climate advocates seek fruitful alliance ahead of COP 27 (Devex)
Nutrition advocates are looking to the upcoming 27th United Nations Climate Change Conference, or COP 27, as an opportunity to team up with climate advocates behind the common goal of increasing access to sustainable diets that are healthy for people and the planet.
Integration of food systems into the climate agenda has often focused on agriculture, which is responsible for about one-third of greenhouse gas emissions. This has largely excluded the explicit mention of nutrition, which focuses not only on the sufficient production of and access to food but also on ensuring that it is healthy and affordable.
“If you work on food systems and nutrition, you cannot not work on the environment. That realization has set in for lots of people, including us,” the Global Alliance for Improved Nutrition‘s Lawrence Haddad said.
Improving carbon border adjustment mechanisms (CEPR)
Climate change and the adverse effects of the accumulation of plastics in the ocean are global externalities. As was the case with ozone-depleting chemicals, these processes threaten to change the way the atmosphere and the oceans function and the functioning of these ecosystems would be better if a way could be found to prevent climate-laggard nations from acting in ways that undermine the efforts of climate progressive nations to encourage progress in the elimination of these externalities. In common parlance, these undermining processes are defined as ‘leakage’.
In political circles, leakage is said to occur when an increase in an environmental standard causes a decline in domestic production and an increase in imports of a good or service from a dirtier source. Perversely, this can cause a net increase in global emissions and, hence, a worsening the extent of the externality. In the worst case, no progress is made. When it comes to dealing with leakage, however, the World Trade Organisation (WTO) has found it difficult to find a solution (Cheng and Ishikawa 2021). In an attempt to find a way to prevent such perverse outcomes, economists have been proposing that global externalities be internalised by requiring importers to pay a levy or charge in a manner that cancels out the competitive advantage that, otherwise, would flow to factories in the laggard country. After considerable reflection in expediting progress in the reduction of greenhouse gases, this is what members of the EU are now trying to do
WFS to Focus on Reshaping Airline Resilience Post-COVID (IATA)
The International Air Transport Association (IATA) announced that the 2022 World Financial Symposium (WFS) will focus on reshaping airline resilience. The event will take place from 19-22 September in Doha, Qatar, with Qatar Airways as the host airline.
Following the greatest shock to aviation in history, the industry is emerging rapidly from the pandemic and government-mandated travel restrictions of the past two years. Industry losses are expected to reduce to $9.7 billion this year from nearly $180 billion in red ink in 2020-21. As travel barriers fall in most regions, very strong demand is supporting expectations for a recovery to pre-COVID-19 traffic levels by 2024, with profitability a possibility in 2023.
At the same time airline debt levels have soared as carriers borrowed to stay aloft during the crisis. And finance departments across the industry will face challenges as the industry achieves its 2050 fly net zero commitment.
“Airlines are resilient. Now is the time to build on the hard work and difficult restructurings of the past two years to seize opportunities coming out of the crisis. Finance will play a vital role in supporting the ongoing recovery while creating a sustainable capital structure to support our ambitious environment agenda,” said Willie Walsh, IATA’s Director General.
What do SMEs stand to Benefit from AML’s Massive Phase II Expansion? (Global News Network)
Operational expansion of corporations and large businesses globally is usually occasioned by diverse and multilayered business interests not just exclusive to profiting. Though profit driven expansions generally occur when businesses seeks additional options to generate more, for large mining concessions like ArcelorMittal, it means protection of business interest for them, and long term investment safeguards, local jobs provision for economic expansion.
When small businesses are empowered to flourish, they mobilize saving and enhance production of goods and services that meet the basic needs of the poor. While estimates vary greatly depending on definitions of SMEs across several countries, recent work by the World Bank suggests that almost 30 per cent of employment in developing countries and Tanzania alike is generated by the informal economy, while an additional 18 per cent is provided by (formal) small and medium enterprises. Together these two groups contribute 63 per cent of GDP in nearly all developing countries.
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ICYMI: South Africa: Ministers are invisible bottleneck in customs duties decisions (The Africa Report)
Companies seeking either relief on customs duties in the absence of local suppliers, or their imposition to protect local industry, face an “opaque” process with no clear timetable or information requirements, MacKay says. MacKay’s company XA Global Trade Advisors has published its first Open Cases Report on the issue. South Africa collects around 55b rand (US$3.3bn) a year in customs duties, and more than 5% of that is tied up in the “cost of indecision,” the report says. The state misses out on collecting R1.25bn in duties that would have been received if higher duties were agreed to and implemented on time, while a further $2bn is collected in duties for goods which are not made locally.
Agri leaders pleading while restrictions pile up (Food for Mzansi)
It’s been a week of “banning” shocks for Mzansi’s farming sector. While most agri leaders have contended with a ban on cattle movement to stop foot-and-mouth disease in its tracks, a ban on vegetable exports to Namibia and Botswana have them pleading for intervention. Citing the protection of their own production, the neighbouring countries took a unilateral decision to block South African veggie crops such as peppers, tomatoes, cabbage, beetroot, and potatoes from crossing their borders. Agri SA now says that it has written to agriculture, land reform and rural development minister Thoko Didiza to request her urgent intervention. “With the jobs and revenue at stake, government must immediately respond to this unjustified action in violation of the Southern Africa Customs Union Agreement,” the organisation says. It adds that the sudden measures are even more severe considering that farmers have done nothing wrong. Also, Botswana only plans to relook the restrictions in two years’ time, when they might expand the list of banned commodities.
Forum aims to revive domestic aviation (New Era)
The Namibia Airports Company (NAC) says it is determined to champion the narrative, lead the charge toward the transformation of the Namibian aviation industry and position it as a driver for a thriving domestic economy. Last week, NAC board chairperson Leake Hangala said the national airport operator is engaging government to see how they can improve the country’s airports infrastructure. This engagement includes looking at the aprons and taxiways at Hosea Kutako International Airport and Ondangwa airport, respectively, as well as building new terminal buildings at Katima Mulilo and Rundu airports.
Hangala made these remarks last week during the launch of the Namibia Aviation and Connectivity Forum. The forum is slated for 16 to 18 November 2022 and is in the follow-up of this event that a white paper and subsequent structural and policy reforms will be generated.
‘Value-addition to steer export earnings’ (Chronicle)
The re-opening of the Cold Storage Company (CSC)-Boustead Beef, should energise exportation of value-added beef and leather products, which will enhance the country’s foreign currency earnings, ZimTrade chief executive officer, Mr Allan Majuru, has said.
Under the National Development Strategy (NDS1-2021-2025), Zimbabwe is focused on expanding its domestic industrial output in which value addition and beneficiation are a game-changer in delivering export-led economic growth.
“If you look at the beef and leather value chain, and look at NDS1, the target is to grow output from around 50 000 tons of beef to around 110 000 tons by 2025. That is where we need to go,” he said. Despite the historic barriers such as Foot and Mouth Disease (FMD) that hit the sector in recent years and the illegal Western sanctions, which crippled beef exports in the past, Mr Majuru said CSC rebound was good news for the economy. “We, are glad now that it (CSC) is now operating again. If you look at the beef and leather value chain globally, it hovers above US$100 billion plus and that’s a lot of money,” he said.
Weakening shilling pushes up Kenya’s debt by $4.1b (The East African)
Kenya’s depreciating currency cost the country nearly half a trillion shillings on the external public debt burden alone, eroding the government’s efforts to pay external lenders. The shilling, which continues to present a challenge to the economy mainly in servicing of external debts and importation of goods by businesses, devalued by 9.3 per cent from 107.85 units by end of June 2021 to 117.83 by June 30 this year. A new report by the National Treasury shows that while Kenya’s external debt stock – in dollar terms – reduced by five per cent from $37.1 billion to $35.3 billion in the year to June 2022, in Kenyan shilling terms it increased by Ksh156 billion ($1.3 billion), to Ksh4.16 trillion ($34.7 billion).”The increase in the public debt is attributed to external loan disbursements, exchange rate fluctuation and the uptake of domestic debt during the period,” Treasury stated in the 2021/22 last quarterly budget and economic review report. The increase in the external debt burden was despite the government’s spending to service loans from other countries, multilateral lenders and foreign commercial banks.
Taxes spoil the party for miraa exporters (Business Daily)
Miraa traders may appear to be making a fortune based on the overall export earnings since the opening of the Somalia market. However, numerous taxes and commission that they pay have dampened their earnings. They are paying a commission of $4.5 (Sh635) for every kilogramme of miraa that is exported to Somalia. The money is collected by brokers at the Jomo Kenyatta International Airport before they are allowed to export. The exporters are also paying $5 (Sh595) as airfreight and handling charges once the consignment is delivered to Mogadishu.
Nyambene Miraa Trade Association (Nyamita) Chairman Kimathi Munjuri said these deductions are chewing a significant portion of their profits. “With all these deductions, the landing cost of miraa per kilogramme is $23 (Sh2737) while we sell the same at $25 (Sh2,975) as the best price meaning that we make a profit of Sh238 per kilogramme,” said Mr Munjuri.
Two link roads connecting Kenya to South Sudan to cost Sh22.6bn (Business Daily)
Two link roads connecting Kenya and South Sudan will cost at least Sh22.6 billion as the roads agency seeks to open up the northern corridor. The Kenya National Highway Authority (KeNHA) says in documents seeking approval from the National Environment Management Authority (Nema) that the first link road, the 142-kilometre from Morpus to Lokichar will cost Sh16 billion. The section stretching from Lesseru to Kitale, a distance of 55 kilometres will cost Sh6.6 billion.
“It’s one corridor but with different lots each with a specific length. It will be built at Sh22.6 billion but the actual cost will depend on the bidders in the tender process. Engineers just give a rough estimate,” Samwel Kumba, KeNHA deputy director of corporate communication said.
Potatoes: What higher import costs mean for consumers (Food for Mzansi)
Farmers have been battling to get good prices for their potatoes due to potato dumping from Belgium, Germany, and the Netherlands. Thabile Nkunjana, an agricultural economist at the National Agricultural Marketing Council, unpacks:
South Africa’s imports of frozen potato chips from the three countries increased by 88.6% between 2020 and 2021 to reach 29 635 tons. Moreover, in the first five months of 2022, the imports from the three countries grew by 114% compared to the corresponding period in 2021. This sharp rise in imports can be attributed to the expiration of anti-dumping tariffs in the first quarter of 2021 which coincided with high potato harvest in the European countries. In the roughly 30 000 tons imported in 2021, Belgium accounted for 67%, Netherlands (17%), and Germany (10%).
Economic recovery: Focus on homegrown solutions, reduce E-levy – GNCCI (The Business & Financial Times)
Any form of support from the International Monetary Fund (IMF) will only provide temporary relief to the current economic challenges, the Ghana National Chamber of Commerce and Industry (GNCCI) has said – urging government to focus on homegrown solutions while reducing the highly controversial electronic levy.
Government is seeking a balance of payment support from the Bretton Woods institution to deal with its mounting economic crisis. However, GNCCI believes that the Fund’s assistance will not provide a permanent solution – just like previous 16 times that the country has sought its support. Rather, it is urging government to be more inward in its approach to overcoming the current economic challenges by focusing more on home-grown solutions: such as value addition, production of goods, optimising local content policies and revenue mobilisation.
African trade and integration
SADC leaders criticise US law seeking to punish African countries that trade with Russia (News24)
The Southern African Development Community (SADC) says the United States’ plan to implement measures to punish African countries that trade with Russia was in bad taste.The US House of Representatives passed the Countering Malign Russian Activities in Africa Act on 27 April by a huge, bipartisan 419-9 majority. The act is awaiting the approval of the Senate, after which US President Joe Biden will sign it into law.The law seeks to sanction African countries that trade with Russia amid the war in Ukraine.
One major highlight is that African countries should not buy oil from Russia, because, according to the US, money generated from oil exports funds the war.But because Russia is a global superpower in food security, African countries are allowed to buy grain from it as long as it’s not stolen from Ukraine.
SADC Reaffirms Support for Regional Peace, Sustainable Development (Business Post Nigeria)
Besides pursuing concrete investment projects and running a joint business with local partners, the United Kingdom now plans to considerably cut taxes from around 99 per cent of goods imported from Africa. At least, after its historic UK-Africa Investment Summit held in January 2020, the UK has increased its support for business on the continent, a step that aims at strengthening aspects of the planned economic cooperation with Africa. Monitoring developments and random research after the summit, we have noticed different priorities – all of which are supporting and strengthening economic partnerships in a number of countries on the continent. The significance of these is to help unlock opportunity, spread prosperity and thus transform lives in Africa.
New vision for development in East Africa will build crisis resilience (EconoTimes)
Facing resurgent conflict, fuel inflation and food shortages, the heads of state of the East African Community (EAC) rallied around a new vision of regional development at their latest summit in Tanzania in late July. Leaders agreed on the importance of unlocking the vast economic potential of its Common Market, stretching from the Indian Ocean to the Atlantic following the Democratic Republic of the Congo (DRC)’s recent accession to the bloc, by ramping up intraregional trade and foreign investment.
This revolutionised Common Market will complement the EAC’s traditional growth model, based on the extraction and export of its raw materials, with a diversified regional economy driven by strong homegrown industries. This more autonomous economy, founded on thriving transport, agriculture and renewable energy sectors, will help build the region’s resilience to external shocks while creating local jobs and fuelling East Africa’s green transition.
Paired with improved regional transport connectivity, a boom in agricultural production would help protect the region from food shortages and inflation triggered by the war in Ukraine and climate change-linked drought.
Building Member States Institutional Capacity to Eliminate Trade Barriers (COMESA)
Four Member States of COMESA have received capacity building support to their institutional frameworks for elimination of Non-Tariff Barriers (NTBs) on Common goods, in compliance with the requisite COMESA Regulations. The regulations define the roles and responsibilities of the NTBs institutions to deliver on the intended objective to eliminate barriers across COMESA region and increase intra-COMESA trade.
Madagascar is the latest Member State to receive training to support the development of a National Strategy for Elimination of Non-Tariff Barriers (NTBs). Similar trainings have been conducted in Zambia, Zimbabwe and Malawi while Egypt and Tunisia are the next in line.
The trainings follow an earlier decision by the COMESA Council of Ministers to the COMESA Secretariat to provide technical support to Member States to implement national NTBs elimination programmes which are premised on sound national NTBs elimination strategies. COMESA Regulations for the Elimination of NTBs provide legally constituted tools for reporting, monitoring and addressing NTBs, the institutional arrangements to manage the NTBs elimination process as well as procedures followed to tackle situations that create NTBs.
Survey announcement: Formulation of the African Development Bank Group’s new Ten-Year Strategy (AfDB)
The African Development Bank Group has launched preparations for a new Ten-Year Strategy (TYS 2023-2032), which will supersede its current TYS (2013-2022). The next TYS is expected to provide a vision for how the Bank plans to build on its significant achievements over the last decade to accelerate Africa’s inclusive, green and resilient growth and development. As part of the formulation of its new Ten-Year Strategy, the Bank is conducting external consultations to ensure that the specific needs and expectations of its clients are well understood and captured. The consultations will also provide an opportunity for stakeholders to offer a variety of perspectives to shape the Bank’s strategy to transform Africa. The consultations will also offer opportunities to deepen existing partnerships and establish new ones, as the continent faces an unprecedented set of challenges in the coming decade.
Afreximbank, Ecobank Togo, and BIA Togo finance the construction of the Adétikopé Industrial Platform (Afreximbank)
The African Export-Import Bank (Afreximbank) as Lead Manager, the Togolese subsidiary of the Ecobank Group and BIA Togo, Attijariwafa Bank Group, have signed a credit agreement with Plateform Industrial Adétikopé SAS (PIA) for the construction of the infrastructure of the Adétikopé Industrial Platform which covers a total area of 400 hectares. This agreement, worth a total of 145 million euros (more than CFAF 95 billion), is part of the support for the socio-economic development of Togo through the implementation of the new government roadmap 2021-2025.
The objective of the new government roadmap 2021-2025 is to make Togo a modern state with a sustainable and inclusive economic growth. Creating more than 35,000 direct and indirect jobs, the Industrial Platform of Adétikopé aims to promote attractiveness and attract investors to develop industrial and multi-sectorial activities, including the processing of agricultural products (cotton, soybeans, cashew nuts, etc.) and local mining. The project in its phase 1, houses an industrial zone; a logistics zone; a commercial & residential center; and a world-class infrastructure. It will also develop in phase 2, agricultural processing industries (cashew, pineapple, corn, mango, sesame) and modern infrastructure.
“Afreximbank considers the industrial platform as an initiative in line with its objectives of promoting and facilitating the development of African industrialization and exports. This project represents Afreximbank’s fourth project in the Industrial Parks space with the Arise Group (two projects in Gabon and one in Benin), a collaboration that today represents solutions totalling approximately €257 million,” said Oluranti Doherty – Director of Export Development, Afreximbank.
Latest US strategy highlights Africa’s place in the new world order (The Mail & Guardian)
Under the harsh, uncompromising glare of superpower realpolitik, the African continent is apparently only significant for three reasons. These are helpfully outlined, in a blue highlights box, in the front of the US’s shiny new “Strategy Toward Sub-Saharan Africa”, which was released this week by Secretary of State Antony Blinken. First, Africa’s people: Africans will be 25% of the world’s population by 2050. In other words, they are the future workforce of a world where the populations of so many countries are ageing fast.
Second, Africa’s geography: The continent is home to 30% of the world’s critical minerals and its second-largest rainforest. There can be no sustainable future without access to those minerals, many of which are crucial to renewable energy technologies. Similarly, the health of the planet depends on the Congo rainforest remaining undeveloped. Third, African countries are the largest voting bloc in the UN, accounting for about 28% of the vote.
Global economy
UN chief ends Europe trip with visit to ‘vessels of hope’ (UN News)
Completing his trip to Europe on Saturday, UN chief António Guterres oversaw the departure of two ships involved in the Black Sea Grain Initiative, a UN-brokered operation to bring urgently needed hunger relief to the Horn of Africa.
In a press conference with Minister Akar, the Secretary-General thanked the government of Türkiye for their pivotal role in the Black Sea Grain Initiative. The collaborative work of the teams sitting around the table at the JCC embodies what we can achieve with political will, top operational expertise, and collective effort, Mr. Guterres told journalists. He described the ships that he had just seen in the Marmara Sea and Istanbul is only the more visible part of the solution. The other part of this package deal, he said, is the unimpeded access to the global markets of Russian food and fertilizer, which are not subject to sanctions.
“Without fertilizer in 2022, there may not be enough food in 2023,” said Mr. Guterres. “Getting more food and fertilizer out of Ukraine and Russia is critical to further calm commodity markets and lower prices for consumers.”
What would BRICS expansion mean for emerging markets? (Atalayar)
As emerging markets recover from the COVID-19 pandemic and face financial headwinds due to interest rate hikes in the US, the BRICS group – Brazil, Russia, India, China and South Africa – is looking to expand its membership to tackle shared challenges.
At the 14th BRICS Summit held in July, China, Russia and India discussed the potential entry of Egypt, Saudi Arabia and Turkey, which are reportedly preparing applications.
Reflective of the potential that enhanced unity and trade among emerging markets can facilitate economic growth, calls for the expansion of the BRICS began in 2013 and received renewed impetus when China was president of the grouping in 2017. However, these initiatives have failed to gain traction.
Critics argue that this current push for BRICS expansion is driven by China’s intent to gain a larger footprint in the global economy, as it is once again president of the grouping. Whereas Russia and South Africa support expansion, Brazil and India have shown little enthusiasm.
Nevertheless, the urgency of solving global challenges of food security and climate change may outweigh such concerns and encourage cohesion among prospective BRICS members.
UN, global orgs call for increased Cotton Made in Africa investments (just-style.com)
The cotton conference, which was organised by the World Trade Organization (WTO) and UN Conference on Trade and Development (UNCTAD) in July urged donors to create partnerships and make investments that will move Africa’s cotton sector forward.
The organisations at the conference announced a “Call for Action” on cotton that recognises the challenges hampering cotton-producing LDCs to compete. The Call for Action commits signatories to continue seeking solutions for the Cotton-4 countries to improve their competitiveness, achieve higher yields and greener production, and add value both to fibre and by-products.
At the call for action signing ceremony, which took place during the conference, she welcomed Afreximbank’s pledge and said: “Cotton is more than a commodity. It’s more than just transforming fibre into apparel or home textiles. Cotton is a way of life and a road to sustainable development.”
“It is a way to address broader development concerns to promote decent jobs and environmentally friendly, sustainable, and fairly priced products.”
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Metals, engineering sector bearing the brunt of various economic events (Engineering News)
After starting the year off strong, the outlook for the metals and engineering (M&E) sector is starting to show deterioration, the Steel & Engineering Industries Federation of Southern Africa (Seifsa) reports. The federation explains that the performance of the M&E sector is indicative of the prevailing economic fundamentals, with it being extremely vulnerable to global and domestic economic events. Seifsa’s estimates already point to production contracting by between 1.1% and 1.3% in the second quarter of the year, with notable downside risks for the full year.
Chibanguza has identified the themes behind global and domestic economic fundamentals as being aggressive monetary policy tightening in the US – in response to multiyear record inflation; the effect of the Russia/Ukraine conflict on the European Union economy; and China’s aggressive zero-Covid-19 policy, which has impacted the country’s economic hubs of Shanghai and Beijing.
“These themes will dominate the global economic narrative and the slowing of global economic growth. Steel production is highly correlated to growth and the early warning signs of a slowing growth rate are evident in the decline in iron-ore prices, a key ingredient in steel production,” he says.
Energy transition also requires choices to ensure food, water security (Engineering News)
While the jury is still out on how exactly climate financing will be used to set South Africa’s energy sector on a low-carbon path, there are various other impacts and changes to industries and households looming, that are not discussed as often. Some of these issues and considerations were unpacked in a webinar hosted by the Black Energy Professionals Association, with comments from exhibition host Enlit Africa head of content Claire Volkwyn, research institute Trade and Industry Policy Strategies senior economist Nokwando Maseko and civic education institution Rosa Luxemburg Stiftung South climate justice project manager Dr Roland Ngam.
Growing need to embed climate resilience into SA’s infrastructure (Engineering News)
News about extreme weather events has become a monthly occurrence, highlighting the importance of embedding some measure of infrastructure and societal resilience in the evolving climate. Damage to the built and natural environments disrupts socioeconomic activity, but the general public, naturally, tends to focus on visibly dramatic and/or traumatic events, often ignoring the more understated impacts of climate change.
Global Centre on Adaptation (GCA) CEO Patrick Verkooijen notes that “every corporation and individual is vulnerable to climate risk because they all depend, to some degree, on infrastructure. Ensuring that these infrastructure systems can operate under future climate scenarios is vital for us and our economies”.
He adds that the cost of infrastructure damage will increase exponentially by 2050. Citing Ghana as an example, he notes that climate risk could lead to $3.9-billion worth of damage to the transport sector by 2050. This would, in addition to strangling the Ghanaian economy, risk cutting off 80% of the population from access to healthcare.
Creating infrastructure resilience requires that local governments understand the current and future impact of climate change on the built and natural environment, and all the potential implications of climate risks. They should also model the risk impacts and use such models to create a comprehensive and strategic plan to help drive resilience, he explains.
Mozambique to export first LNG as global natural-gas prices soar (Engineering News)
Mozambique is poised to ship its first cargo of liquefied natural gas overseas, joining the ranks of the world’s exporters as a global energy crunch pushes prices of the fuel to record highs. The LNG tanker British Mentor, operated by BP Plc, is set to arrive Aug. 24 at a new floating terminal that Eni is completing off Mozambique’s northern coastline, ship-tracking data compiled by Bloomberg show. Eni didn’t immediately respond to a request for comment. The Italian company has said it’s already planning a second floating export platform in the southern African country that could be brought on in less than four years.
Nigeria Recorded Positive $2.6bn Trade Balance with Indonesia in 2021 (This Day)
Nigeria recorded a favourable trade balance of $2.6 billion in its bilateral trade relationship with Indonesia in 2021. This was disclosed yesterday by the President of Nigerian Indonesian Chamber of Commerce and Industry (NICCI), Mr. Ishmael Balogun, during a press conference to announce the Nigerian Indonesian Investment and Trade Forum 2022, which would be holding in Jakarta, Indonesia between October 17, and October 27, 2022.
Balogun said that deliberate effort is needed to increase the trade balance to $4 billion in favour of Nigeria in 2023 by attracting more foreign direct investments from Indonesia to Nigeria as well as showcasing the best of Nigerian products for export trade with Indonesia in particular and the rest of the world in general.
He said: “Our (Nigeria) trade balance with Indonesia in 2021 was exactly $2.6 billion. It is my opinion that we can actually do better than that. And that is why we need to take deliberate actions. For that reason, we said that we going to do Nigeria Indonesia Trade Mission in Jakarta, Indonesia.
“We want the trade balance to reach $4 billion by 2023. And in order to do that we are sensitising Nigerian business elites and informing them that Indonesia is a place where there are opportunities in agriculture, horticulture, pharmaceutical, beauty and lifestyle, aviation, defence, digital economy and green energy. If they are doing it right, then there is a lot we can learn from them.
Over $600m spent on imported chicken in 2021 - poultry farmers unhappy (Ghanaian Times)
Over $600 million worth of chicken is dumped onto the Ghanaian market annually. This has compounded the woes of Ghana’s poultry industry which is on the verge of collapse due to the lack of regulation to check the dumping of chicken onto the market. Speaking at a hearing over allegations of dumping of chicken into the country by the Ghana International Trade Commission, National Chairman of the Poultry Farmers Association, Victor Oppong, expressed worry that local players may be forced out of business.
The Ghana International Trade Commission seeks to find an amicable solution to unfair trade practices that has been a hindrance to many Ghanaian businesses including the poultry industry. The investigation of dumping of poultry products is influenced by widespread agitations from local players regarding loss of jobs and quality of products onto the market.
Exporters urged to be mindful of fake Certificate of Origin (Ghana Business News)
Exporters must be mindful of the originality of Certificates of Origin (COO) that accompany their exports since some unscrupulous freight forwarders are generating fake ones. Mr Daniel Osei Torgbor, Greater Accra Regional Head of the Ghana National Chamber of Commerce and Industry (GNCCI) who made the call, said the issuance of fake certificates to accompany export goods, could mar the image of the country globally and affect bilateral agreements meant to extend some privileges to Ghanaian exporters. Speaking to Ghana News Agency in an interview in Kumasi, he said COO was an important international trade document that certified that goods in a particular export shipment were wholly obtained, produced, manufactured and processed in a particular country.
It also facilitates international trade and proves authenticity of the product, while providing documentary evidence of origin of the goods exported and other varieties of documentation such as packing lists, commercial invoices and proforma invoices.
He stressed that immediate attention and action was needed to address the issues considering the role of the certificate of origin in the African Continental Free Trade Agreement (AfCFTA), since it was the primary document that was being used to facilitate trade.
Establish more firms in Ghana – Kyerematen woos Indian investors (BusinessGhana)
The Minister of Trade and Industry, Alan Kyerematen, has urged Indians to invest more in Ghana, especially in the manufacturing sector, to benefit from the opportunities offered by the African Continental Free Trade Area (AfCFTA). He said although existing Indian companies in the country had contributed immensely to Ghana’s economy and also created jobs for the youth, India could still do more by taking advantage of the peaceful business environment in the country. Mr Kyerematen was speaking at a reception to mark the 75 Independence anniversary of India at the India House in Accra last Monday.
“Our two countries share a lot in common — our struggles for independence from colonial rule, our shared democratic values and our common challenges, to mention but a few. We cherish the longstanding friendship and cooperation between our two countries,” he added.
Ghana has developed a maritime policy. Here is what it means (The Conversation)
Ghana has an abundance of marine resources. They include fisheries, hydrocarbon reserves, inland waterways and ports that are located along important international shipping lanes. These present the country with a wide range of opportunities for ensuring food security, bridging income inequalities, attracting foreign direct investment, increasing domestic productivity, and enhancing trading conditions. This underscores the imperative to harness and safeguard them wisely.
The vision of the strategy is to ensure that by 2040, Ghana’s maritime space will be safe and secure with a thriving blue economy that benefits every Ghanaian. It presents an integrated approach towards achieving this vision.
The document outlines six strategic objectives that focus on safety, security, marine environmental protection, blue economy development, capacity building and cooperation. It also provides a framework for implementation and sustainability. This includes calls for the allocation of resources funded from the national budget.
35.8% decrease in Egypt’s trade deficit in May 2022 (Daily News Egypt)
The Central Agency for Public Mobilization and Statistics (CAPMAS) issued on Wednesday the monthly bulletin of Foreign Trade in May 2022. The trade deficit reached $2.61bn during May 2022, versus $4.06bn in May 2021, a decrease of 35.8%.
Egypt’s exports increased by 18.3% as it reached $4.01bn during May 2022, versus $3.39bn in May 2021, due to an increase in the value of some commodities such as petroleum and liquefied natural gas products by 44.1%, crude oil by 30.7%, fertilizer by 33.9%, and ready-made clothes by 48.1%.
African trade and integration
Africa still has a disproportionate dependence on extractives’ exports (IPPmedia)
The strategic partners’ consultative retreat on AMDC’s theory of change was inclusive of an overview of the new AMDC’s operational metrics alongside the current and rapidly evolving minerals management and development landscape on the continent.
Opening remarks by His Excellency Albert Muchanga, the African Union Commissioner on Economic Development, Trade, Tourism, Industry and Minerals (ETTIM) began by describing the milestone memory lane trek since the launch of the first phase AMDC in 2013 to date as a response to the question of where AMDC has come from in its mandate to become the facilitator of choice to enable AU Member States realise the Africa Mining Vision. Against that backdrop, the Commissioner envisaged the retreat would come up with a roadmap towards AMDC becoming a dynamic organisation capable of meeting the sustainable development needs of Africans courtesy of the minerals sector.
In concluding his remarks, the Commissioner urged the strategic partners, of which he hoped in future will have all the African Union Regional Economic Communities(RECs) represented in addition to the Africa Finance Corporation as well as the Africa Trade Insurance Agency, to work in conjunction with the mandate of the AMDC Interim Secretariat
Upon presentation of the AMDC’s results framework centred around several goals, presentations were made by the strategic partners on their work and how they would collaborate on the Centre’s goals amongst which are to ensure: That Member State policies are consistent with the principles of the Africa Mining Vision (AMV), including governance and participation in the minerals sector; Minerals contribute as a driver for industrialisation, facilitated by intra-African trade; Enhancing geological and mineral knowledge and information systems for development; Modernising Artisanal and Small-scale Mining (ASM) and ensuring the sector is fully integrated into the formal national and regional economies; Sustaining and integrating the management of Africa’s mineral and energy resources, business process innovation and efficient capital resources allocation whilst encompassing robust follow-up, coordination, reporting, knowledge management and capacity building and/or strengthening.
Transport start-ups growing in sub-Saharan Africa (Engineering News)
In the past year, the transportation sector achieved an impressive record of 21 start-up companies, the majority of which were aimed at unlocking new growth opportunities through software, Internet-enabled solutions, and alternative e-mobility solutions. With roads being the arteries through which the African economy pulses, the ongoing challenges have been great hindrances to sustainable economic growth and global competitiveness and trade. The spark of positive change being driven by recent start-ups in markets such as Nigeria, South Africa and Kenya has the potential to continue being positively influenced by global trends and shifts, but will require the continued support of innovators in both the private and public sectors.
This start-up wave brings one step closer achieving the estimated jump of $16-billion in intra-regional trade that economists and trade experts expect to be possible through the African Continental Free Trade Area (AfCFTA) agreement. Though not without challenges, including an infrastructure investment shortfall of between $67-billion and $107-billion yearly, according to the International Finance Corporation, a look at recent start-ups and funding avenues in Africa points to a growing attraction of the continent as the last growth frontier for investors.
For transport start-ups specifically, the records show a proactiveness by innovators to help solve Africa’s connectivity predicament, where supply chain challenges and limitations in physical infrastructure network limitations amount to about 40% to 60% of the surcharge costs for goods in Africa.
Post-Covid restart offers African airlines a new chance (The Citizen)
African airline operators are going back to the drawing board. They are mapping sustainability plans including fostering cross-market collaborations to rev up the continent’s intra-African and grow their global air traffic market share. Africa’s aviation operators and experts have retreated to the drawing board to analyse the continent’s falling global air traffic share as rising passenger demand begins to lift airlines performance closer to pre-pandemic levels.
The establishment of Africa’s first ‘aviation laboratory’ and the start of implementation of a strategic alliance between Kenya’s and South Africa’s national carriers in July are the latest indications of an industry keen on addressing bottlenecks to its growth and expansion, competitiveness and sustainability.
“The overall objective of the laboratory was to address the root cause of challenges facing the air transport industry in Africa and develop relevant solutions to revamp the sector,” said African Airlines Association (Afraa) secretary general Abdérahmane Berthé.
A sustainable future for Africa through continental free trade and agricultural development (Nature)
Developing and integrating agricultural markets may be key to addressing Africa’s sustainability challenges. By modelling trade costs from farm gate to potential import markets across eight African regions, we investigate the impact of individual components of continental free trade and the complementary role of domestic agricultural development through increased market access for farmers and agricultural intensification. We find that free trade would increase intra-African agricultural trade sixfold by 2030 but—since it does not address local supply constraints—outside food imports and undernourishment would reduce only marginally. Agricultural development could almost eliminate undernourishment in Africa by 2050 at only a small cost of increased global greenhouse gas emissions. While continental free trade will be enabled in Africa through the African Continental Free Trade Area, aligning this with local agricultural development policies is crucial to increase intra-African trade gains, promote food security and achieve climate objectives.
JICA, AfCFTA collaborate to enhance opportunities for businesses (Graphic Online)
THE Japan International Cooperation Agency (JICA) has opened discussions with the Secretariat of the Africa Continental Free Trade Area (AfCFTA) in Accra on how to maximise the benefits of the trade pact for businesses in Africa. The discussions are to explore the possible areas of cooperation between the two sides to for JICA to invest resources and technical expertise to help enhance the opportunities for businesses.
The Vice President of JICA said Japan, through its international assistance agency has been a critical component of private sector development in Africa and would continue to support critical stakeholders in the continent to create opportunities for businesses. Mr Kato said the agency saw the AfCFTA to be a great opportunity for opening up trade among African countries and efforts to maximise its gains would be prioritised.
He noted that while the free trade area was critical to Africa’s development, its successes could be limited if the right programmes were not put in place.
Towards deeper integration in SADC (sardc.net)
The 42nd SADC Summit adopted a raft of measures to deepen regional integration and sustainable development in southern Africa. The theme of the summit was ”Promoting industrialization through, agro-processing, mineral beneficiation, and regional value chains for inclusive and resilient economic growth.”
The approval of the much-awaited SADC Regional Parliament brings on board what has long been seen as the missing piece in the regional integration jigsaw puzzle. A SADC Regional Parliament will ensure broader citizen participation in regional affairs. It will also facilitate more extensive debate on regional issues and thus accelerate the implementation of SADC protocols that need to be ratified and domesticated into national legislation. This can become a key driver of integration and development, bridging the gap between citizens and policymakers.
Sadc development fund key to unlocking integration, industrialisation (Chronicle)
Operationalisation of the Sadc Regional Development Fund is vital to unlocking and fast-tracking integration and industrial development as it avails the necessary resources for the implementation of various development programmes.
This was a key message expressed by the leadership of the Southern African Development Community (Sadc) at the 42nd Sadc Summit in Kinshasa, the Democratic Republic of Congo. Mooted nearly a decade ago, the Sadc Regional Development Fund (RDF) is a self-financing and revolving mechanism intended to end the reliance on external support to drive southern Africa’s development agenda. The Fund will provide a window for financing economic development and sustainable growth through supporting regional infrastructure development, industrial development, integration and other economic needs as well as social development at concessionary rates.
Current estimates to fund development programmes targeted in the Sadc Regional Indicative Strategic Development Plan 2020-2030 have been put at over US$50 billion.
As West Africa’s population booms, its economy continues to expand, the opportunities for businesses to trade across the region are vast. The rising need economy has presented various opportunities across all industries in West Africa. Previously an agriculturally driven economy is now facing a transition. Majority of the newly established businesses are catering the growing needs of the people of west Africa, which include industries such as Hospitality, Healthcare and Banking.
One of the catalysts and driving forces for this economic can be seen from active participation of the West Africa Trade & Investment Hub (Trade Hub, which is a 5-year, $140 million trade and investment facilitation activity designed to improve private sector productivity, profitability, and competitiveness in West Africa through market-based approaches. The West Africa Trade and Investment Hub is a one-stop shop that partners with banks/financial institutions to provide financial support and business development services, capacity building, and best practices with the aim of making businesses viable and export ready, through the African Growth Opportunity Act (AGOA).
One of the largest economies in West Africa, Nigeria has seen significant surge in Energy usage. The government has been looking at alternate sources of energy such as Solar & Waste-to-Energy plants which has led to the inception of green power projects across the region. Barika and Kraft has been actively participating in this sector with a multitude of projects securing Seed-funding under the patronage of Barika and Kraft.
Apart from Nigeria, another nation observing a significant spike in economic prosperity is Ghana.
Beijing refutes West claims of ‘Chinese debt trap’ in Africa (Al Mayadeen English)
China hits back at the US claims that it is setting up a debt trap in Africa as Beijing grows closer to the African continent.
The Western claims of Beijing setting up a “Chinese debt trap” in Africa are baseless and irresponsible, Chinese Foreign Ministry spokesperson Wang Wenbin said on Thursday. Wang provided a list of data to show the win-win nature of Sino-African cooperation while criticizing Western officials and media over their attempts at driving a wedge between China and developing nations by using false claims. Asked about claims of a “Chinese debt trap” raised and pushed by US Secretary of State Antony Blinken during a trip to Africa, Wang said at a regular press conference on Thursday that such claims were only used by US and other Western officials to shift responsibility.
According to data from the World Bank, at the end of 2020, bilateral creditors held 26% of the foreign loans of 82 low and medium-income countries, while commercial creditors and multilateral creditors made up 40% and 34%, respectively. China held less than 10% of the total external debts.
In the newly-added $475.2 billion of external debt in low and medium-income countries between 2015 and 2020, commercial debt from the global financial market accounted for 39%, Wang highlighted, quoting a European Network on Debt and Development survey that showed that 95% of sovereign debt in 31 indebted countries was held by Western financial firms.
Global economy
Developing Countries Trading Scheme: government policy response (GOV.UK)
The Developing Countries Trading Scheme is a major milestone in growing free and fair trade with developing nations. The Developing Countries Trading Scheme applies to 65 countries, offering lower tariffs and simpler rules of origin requirements for exporting to the UK. The scheme helps countries to diversify their exports and grow their economies, while British households and businesses benefit from lower prices and more choice.
The Developing Countries Trading Scheme cuts administrative costs for businesses by reducing more tariffs and bringing more countries in scope of the most generous tariff reductions. It also cuts red tape for developing countries, for example by simplifying rules of origin requirements for the least developed nations. This helps the world’s poorest countries to export to the UK and play a more active part in fast growing global supply chains.
It also helps lower costs for UK businesses, leading to lower prices for consumers across a range of everyday products, by reducing tariffs on imports from low income and lower-middle income countries. Increasing trade and decreasing tariffs is another way the government is supporting businesses and individuals with cost-of-living increases.
The role of trade and investment policies to transition to a circular economy (ITC)
Issues related to acquiring innovative clean technologies and access to finance determine businesses’ ability to adapt in order to maintain business competitiveness. Overcoming these concerns by obtaining resource efficient technologies and strengthening access to finance requires national trade and investment policies designed to build resilient and sustainable economies.
Supporting countries in greening requires a concerted effort at multilateral, regional, and national levels to translate circular economy principles into trade and investment policy frameworks.
At global and regional levels, this entails organizing targeted dialogues and engagements with policymakers, trade negotiators, private sector, civil society, and other stakeholders to consider how the principles of the circular economy could be integrated into trade agreements.
A guide for SME garment manufactures to achieve greater profitability (ITC)
Determining the cost and value of garment manufacturing operations is a challenge faced by all textile and clothing companies, particularly those in developing countries where many small and medium-sized manufacturers remain focused on simple cut and sew operations, providing low value services and producing very basic commodity-type garments.
The new ITC publication, The Garment Costing Guide: for small firms in value chains, helps manufactures, and those that support them, understand the true costs and value of producing clothing beyond simply sewing operations. Manufacturers that provide additional services will be more competitive and take an important step towards becoming a preferred supplier to customers.
Pamela Coke-Hamilton, Executive Director of the International Trade Centre (ITC) explains: “Garment manufacturing has evolved from a simple manufacturing operation into a complex service industry where the actual cut and sewing operations are the simplest and least remunerated tasks. The guide not only explains how to capture and calculate all costs of making a garment, but also offers solutions on how to reduce costs along the full supply chain to increase profit margins for garment manufacturers as well as their customers”.
Consensus will be key to next G20 summit (China Daily)
The meeting of G20 finance ministers and central bank governors in Bali last month-largely overshadowed by discord over the Russia-Ukraine conflict-did not produce a communique at all. And, as it stands, there is little reason to think that November’s G20 Leaders’ Summit in Bali will go any better.
The G20’s host this year is a representative of this more diverse group of major economies. Indonesia understands that strategic patience is essential to build consensus among countries operating from different perspectives and stages of development. After all, it is a member of the highly diverse Association of Southeast Asian Nations, which emphasizes consultation and consensus. Most developing and emerging-market economies view peace and stability as prerequisites to their continued development.
If this year’s G20 summit is to produce any progress, its members-especially the G7 countries-must embrace consultation and consensus.
Emerging-market economies, already shaken by the collapse of the Sri Lankan economy, are bracing for higher inflation, escalating food shortages and increased debt distress. JPMorgan notes that intensifying pressure on external and fiscal accounts is driving a growing number of countries to seek assistance from the International Monetary Fund, or at least to move in that direction.
Amid such far-reaching and interconnected crises, one might imagine that global cooperation would be forthcoming. But there seems to be little appetite to compromise, especially at the G20 level.
The situation is very different within the G7. At 47 years, the G7 has been around more than twice as long as the nearly 23-year-old G20, though it is worth noting that the G7 was the G8 for much of that history. Russia was kicked out in 2014.
This points to a defining characteristic of this older, smaller club: It comprises the Western democracies that have largely dominated the world economy since 1945.
In 2020, the G7 accounted for over half of global net wealth and roughly half of world GDP, despite being home to just 10 percent of the world’s population.
Open Letter to G7 and G20 leaders: resolve global crises to secure our future (Nature)
Related News
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Local news
Didiza asked to intervene in blocking of SA vegetables by Botswana, Namibia (News24)
The SA government needs to urgently intervene in the unilateral closing of their borders by Botswana and Namibia to certain fruits and vegetables from South Africa, claiming it is to protect their local producers. Since the beginning of the year, for example, Botswana has blocked SA exports of tomatoes, carrots, beetroot, potatoes, cabbage, lettuce, garlic, onions, ginger, turmeric, chilli peppers, butternut, watermelons, sweet peppers, green mealies and fresh herbs.
This unilateral action is against trade agreements with South Africa, including the Southern African Customs Union (SACU) agreement, according to agricultural body Agri SA. Botswana, Eswatini, Lesotho, Namibia (BELN) and SA form the SACU, meaning they are supposed to have a common external trade border with free flow of goods within the union.
The situation has become “untenable” and requires government intervention urgently to prevent the SACU agreement from being nothing more than a “lame duck”, Agri SA executive director Christo van der Rheede writes to Minister of Agriculture, Land Reform and Rural Development Thoko Didiza and Minister of Trade, Industry and Competition Ebrahim Patel in a letter dated 8 August and seen by Fin24. He claims Botswana and Namibia are the main culprits.
“These countries have cited a need to protect local production as the motivation for these border closures,” Van Rheede tells Didiza. “We have noted that, while Botswana and Namibia close their borders to vegetables from SA, they remain happy to send their like products back into SA, and at predatory prices to boot.”
Traders stare at losses as gold coins boost Zimbabwe dollar (Engineering News)
Not everyone is happy about the Zimbabwean dollar’s gains. Black market traders have been left reeling as measures taken by authorities, including new gold coins, to support the embattled local currency dry up excess liquidity and erode arbitrage opportunities.
How Kenya’s trade deficit hit a record Sh666bn in first five months of 2022 (Business Daily)
Costly imports of fuel, edible oils and fertiliser widened Kenya’s trade deficit to a record Sh666.2 billion in the first five months of the year, piling pressure on the shilling and straining household budgets due to rising inflation.
The 23 percent or Sh189 billion jump in the import bill to Sh1.02 trillion is largely a result of the ongoing Russia-Ukraine conflict, which has disrupted global supply chains of critical commodities such as petroleum fuels, metals, fertiliser and grains.
Data from the Central Bank of Kenya (CBK) shows that this growth in imports has significantly outstripped that of export earnings, which in the period grew by Sh41 billion to Sh354 billion. The ballooning trade deficit is eating into the country’s foreign reserves, which are critical in supporting the stability of the currency.
In addition to the supply disruptions caused by the conflict, the shilling has also felt the heat of higher dollar demand and is now trading at an all-time low against the greenback. Importers require more shillings to acquire dollars to pay their suppliers, resulting in imported inflation.
Sh40bn terminal shapes Mombasa port battle (Business Daily)
Before the launch of the new Sh40 billion Kipevu Oil Terminal in Mombasa, the old facility that had been in existence for six decades could only handle 35,000 tonnes of cargo at a time. It could also accommodate one vessel at a time of upto 120,000 dead weight tonnage. But the new offshore terminal has changed the fortunes of the Mombasa port, which is facing increased threat from neighbouring ports in Tanzania and Djibouti, given that it will handle four vessels of up to 200,000 dead weight tonnage at a time. This means that at optimum, in seven days, it would handle what the old port would do in a month.
The new facility promises to ease pressure on the Mombasa port that had been aggravated by increased demand in Kenya and the region.
Kenya says it will invest in the energy and petroleum sector, to create a reliable and efficient energy supply through oil exploration and oil handling facilities. “Over the last few years, the region has been making a significant effort towards the exploration and mining of oil. Soon the region will join the oil-producing and exporting countries of the world,” President Kenyatta said. He said the need for petroleum products has continued to increase in the region due to economic growth and development through rapid industrialisation.
“The modern terminal is faster and will have various benefits to the economies of the region. Key among them include reduced vessel turn-around time from four to two days, with a significant reduction in demurrage costs. On the other hand, it is expected to reduce freight costs owing to improved cargo handling capacities and leverages associated with larger economies of scale,” said Mr Kenyatta.
Truckers resume normal regional operations after elections hitch (Business Daily)
Truckers have resumed normal operations after the flow of goods between Kenya and the neighbouring countries was interrupted this week with the announcement of presidential results on Monday. The chaos and uncertainty that had been witnessed in some pockets of the country saw truckers withdraw from the roads, paralysing trade along the Northern Corridor. Chief executive officer of the Kenya Transporters Association (KTA) Mercy Ireri said they are now fully operational and that the flow of goods to either side of the border is back to normal.
“We have been at near zero in regard to road transport from the Port of Mombasa to the border towns of Malaba and Busia in the last couple of days, but now the situation has come back to normal,” said Ms Ireri. Cargo trucks destined for Kenya via the Busia border were being diverted through Mumias road in Kakamega County to Bungoma and Eldoret on their way to Mombasa.
Angola to start talks on trade deal with EU in bid to diversify from oil (SowetanLIVE)
Angola and the European Union are set to start talks for a trade deal this year after EU and African partners approved a request from the oil-producing nation to join a regional trade bloc, according to an EU document and an official. The green light to start negotiations came in late July, an EU document shows, shortly before the southern African country holds general elections next week. “We are now in a position to open formal negotiations, but there is not yet a date agreed with Angola. We expect this to happen in the last quarter of this year,” an EU spokesperson told Reuters.
The possible deal would likely increase the export of Angolan products to the EU, and possibly reduce the dominance of oil which currently accounts for nearly all exports by value.
With the boost in trade expected from the deal and EU’s increased need of fuel amid the energy crisis caused by the war in Ukraine, Angola might also export more oil to the 27-nation bloc. Currently China is by far its largest customer, despite oil now faces no import duty in the EU.
Under the deal, EU products will also access the Angolan market with lower duties - an advantage for local consumers but a risk to domestic industries if they do not invest to remain competitive.
Ghana: Local poultry sector nears extinction (The Business & Financial Times)
Over 400 poultry farms in the country have had to shut down operations due to multiple reasons – including high production cost mainly driven by the price of raw materials and feed cost, the Ghana National Association of Poultry Farmers (GNAPF) has indicated. Other reasons such as the prevailing interest rate, surge in chicken imports, bird-flu and cost of labour have been mentioned by the association as key drivers of the industry’s collapse.
“The current situation is dire, and our farmers are losing millions through the closure of their farms. We are at the emergency level now. As it stands, 70 percent of existing farms nationwide are empty,” Victor Oppong Adjei, President of the GNAPF, told the B&FT.
Cameroon Says Floods Disrupt Cross Border Trade with Nigeria (VOA)
Cameroonian authorities say record flooding on its western border with Nigeria has killed at least six people, washed away homes, and destroyed thousands of tons of food meant for export. The floods destroyed a 36-meter-long bridge on the River Momo, keeping hundreds of merchants and commuters stranded on both sides of the river. Momo, an administrative unit where Widikum is found, is a production basin for palm oil, maize, potato, tomatoes and vegetables.
Cameroon’s National Observatory on Climate Change last month predicted that floods and landslides would hit many Cameroonian towns and villages including Widikum.
Senegal and Egypt Emerge as Potential LNG Exporters to Europe (The Maritime Executive)
As Europe struggles to gain a greater degree of energy independence and replace energy historically imported from Russia it is looking to new parts of the world to become suppliers. In a rather unique turn of events, some African countries are promoting their rich hydrocarbon deposits as a solution. It could become a win-win situation for Europe desperate for new sources and for the African nations that are hungry for foreign currency to support their sagging economies.
African nations that historically would not have been thought of as potential suppliers to meet Europe’s energy needs are emerging as leading candidates. Senegal in West Africa is moving rapidly to develop its liquefied natural gas operation to become an exporting nation. Similarly, European companies have projects under development in Mozambique while Egypt is working to boost its operations after the discovery of the Mediterranean’s largest deposits of LNG.
African trade and integration
Uniting Africa under one payment system slow but steady process – Ogbalu (Monitor)
In July, the Pan-African Payment and Settlement System (PAPSS) marked three years since it was launched on July 7, 2019, in Niamey, Niger. The PAPSS chief executive officer, Mike Ogbalu III talked to Bamuturaki Musinguzi about the achievements, prospects and bottlenecks.
Why was the Pan-African Payment and Settlement System (PAPSS) developed?
A: The barriers, or challenges to increased intra-African trade include lack of adequate trade information, structural rigidities, historical trading patterns (historical ties with former colonial countries), poor trade facilitation and regulatory issues, poor implementation of regional commitments, poor state of trade related infrastructure (barriers to the movement of goods), and fragmented payment, clearing and settlement infrastructure.
PAPSS was adopted in July 2019 in Niamey, Niger, by the African Union heads of state as the payment and settlement system to support the implementation of AfCFTA. It is a financial market infrastructure that has been developed and initiated through a collaborative effort of the AfCFTA Secretariat, Afreximbank and the African Union Commission.
How is PAPSS being implemented across the continent?
A: The journey started with a pilot phase in the West African Monetary Zone (WAMZ) where central banks of Nigeria, Ghana, Liberia, Guinea, the Gambia, and Sierra Leone successfully performed live transactions between each other. We chose this region because it presented decisive arguments for a pilot exercise, before considering a deployment of the system throughout the continent: six countries with different currencies, speaking English and French and carrying out a substantial volume of cross-border transactions.
With this successful pilot-run, we are now ready to bring any central banks and commercial banks on board. We expect to be in the five regions of Africa before the end of 2023, all central banks signed up by end of 2024 and all commercial banks by end of 2025.
Traders fear Kenyan goods could face stiff competition in AfCFTA (The East African)
The KAM, in their latest survey titled Implication of the African Continental Free Trade Area on Kenya’s manufactured products and its impact on Kenya’s trade, reveals that the dwindling country’s competitiveness due to a high cost of doing business, bureaucratic policy and regulatory environment could inhibit its ability to take advantage of the AfCFTA.
Kenya’s manufacturers are worried about losing out on the benefits of the African Continental Free Trade Area (AfCFTA), due to a high cost of production that may hurt their competitiveness. The Kenya Association of Manufacturers (KAM) has tallied local costs of production to be higher than the continental average, meaning their goods may face stiff competition in trading across Africa. Kenya’s global competitiveness index is about 55 percent, while it ranges between 35 to 60 percent in Africa, an indication of a constrained business environment.
“There is a positive change for Kenya’s export to Africa under 90 and 100 per cent tariff liberalisation for South Africa, Eswatini, Ghana, Morocco, Togo, Côte D’Ivoire, Botswana, Namibia, Senegal and Tunisia,” the report says. ”Change is negative for Kenya’s exports to Zambia, Rwanda and Madagascar.”
The report also reveals that the impact of tariff liberalisation under the AfCFTA on Kenya’s economy is estimated to grow imports by five per cent at 90 per cent tariff liberalisation, and at 11.4 per cent at full liberalisation. ”There are strong value chains in agro-processing, textile and garment, footwear, mining, leather, rubber and plastic sectors,” it says.
Let’s Fully Utilize Trade Agreements & Opportunities – Urges EABC Chairperson Angelina Ngalula (EABC)
“The EAC bloc should boost its transactions under the regional and international trade agreements and opportunities of African Continental Free Trade Area (AfCFTA), African Growth and Opportunity Act (AGOA), Economic partnership agreement,” said EABC Chairperson Angelina Ngalula at the High-Level Business Dinner in Arusha. Statistic show intra-EAC trade is below 20%, intra-African exports is 18% of total exports, EAC exports to AGOA valued at USD. 5.26 Billion while EAC exports to EU stood at USD.2.67 billion (ITC,2021).
EABC Chairperson Angelina Ngalula said that despite the agreements & opportunities East Africans have not fully utilized these agreements as trade is still fractional due to low productive capacity, fragmentation and infrastructure challenges.”With the AfCFTA, there are no boundaries of doing business in Africa, but the EAC bloc should be well-prepared to export competitive professional services and skills to the continent,” said Chairperson Angelina.
On his part, Mr. John Bosco Kalisa, EABC CEO said EABC with support from GIZ developed a Barometer on East African Trade in Services to gauge the growth of the service sector in the EAC. He expounded that the EAC region exported services worth USD 12.9 billion against USD. 933.6M worth of imports globally in 2019.
Market East Africa as a Single Investment Destination – Urges EABC Chairperson Angelina Ngalula (EABC)
EABC Chairperson Angelina Ngalula has called upon the Governments of the EAC Partners States to market East Africa as a single investment destination by showcasing and reinforcing the bloc’s comparative and competitive advantage.
Improving the quality & competitiveness of products and services is one of the top priorities Chairperson Ngalula seeks to spearhead in order to reposition East African business to seize opportunities availed by the 1.3 billion African Continental Free Trade Area (AfCTA). Other priorities are improving the performance of EAC transport corridors and eliminating persistent Non-Tariff Barriers.
On his part, Mr. John Bosco Kalisa EABC CEO said “EABC is a core partner of the EAC regional integration agenda as outlined in Article 127 of the Treaty.” He urged Governments to liberalize EAC airspace to reduce the cost of tickets & cargo freights as well as boost the volume of air cargo exports outside the region.
Security, trade high on the agenda as SADC leaders meet in Kinshasa (Africanews)
Leaders of Southern African nations are meeting in Kinshasa for their 42nd summit. The leaders are expected to review the progress made towards achieving closer integration and deepening regional trade. The summit will be held under the theme “Promoting Industrialization through Agro-Industry, Mineral Resource Enrichment and Regional Value Chains for Inclusive and Resilient Economic Growth.
Communiqué of the 42nd Ordinary Summit of SADCS Heads of State And Government
How a $260M bridge negotiated Africa’s most unusual border (CNN)
Today, the pontoons sit ashore, mercifully redundant. You might spot them while crossing the 923-meter (3,028-foot) long Kazungula Bridge, a $260 million project co-financed and co-operated by Botswana and Zambia, that a year into service has already transformed this southern African trade artery. The bridge was conceived to speed up travel along the Southern Africa Development Community (SADC) North-South Corridor, a route historically beset with costly border delays.
The bridge opened in May 2021 but was over a decade in the making, explains Kazungula project engineering manager Isaac Chifunda.
“Africa was massively represented on this project,” says Chifunda. Although construction was overseen by South Korean company Daewoo E&C, the team was multinational, he says, and raw materials including cement, steel and aggregates came from across southern Africa. As a significant investment for Zambia and Botswana, the bridge is packed with technology to ensure its long-term future.
Africa Needs Investments, Not Food Support—Adesina (Business Post Nigeria)
A new report from Climate Policy Initiative (CPI) has said that Africa is getting just 12 per cent of the finance it needs to manage the impact of climate change. It, however, raised pressure on rich nations to do more in the run-up to global climate talks at COP27 in November. CPI said that around $250 billion is needed annually to help African countries move to greener technologies and adapt to the effects of climate change, yet funding in 2020 was just $29.5 billion.
“Harnessing climate investment opportunities in Africa will require innovation in financing structures and strategic deployment of public capital to ‘crowd-in’ private investment at levels not yet seen,” the CPI report said.
Time to fix seed systems to tackle Africa’s hunger crisis (Mail & Guardian)
Between 2008 and 2018, Africa suffered an estimated $30-billion in losses caused by a decline in crop and animal production, as a result of floods, diseases, droughts and other shocks, according to the United Nations Food and Agriculture Organisation. With such increasingly unpredictable weather patterns, a result of the effects of climate change, and frequent pest and disease outbreaks, farmers must take any measures to enhance yields. This includes access to and planting quality seeds. Seeds significantly influence the quality and quantity of farmers’ output. The African Union Commission’s Seed Sector in Africa: Status Report and Ten-year Action Plan (2020-30) indicates that good quality seeds can potentially increase overall productivity by nearly 40%.
Clearly, it is critical that efforts to put quality seeds in the hands of smallholder farmers, who represent 70% of Africa’s agricultural production, are accelerated. A key measure to support this is the formalisation of seed systems being rolled out in many African countries by instituting legislation.
Africa Has a Food Shortage of Over 30 Million Metric Tonnes (Morocco World News)
UK to slash import duties for 65 countries, but SA does not qualify | Fin24 (Fin24)
The UK will be extending its import tariff cuts to hundreds more products such as clothes and food from 65 developing nations, but South Africa does not qualify for the benefit.
The Developing Countries Trading Scheme (DCTS) comes to effect in January and replaces a previous scheme - the Generalised System of Preferences (GSP), Reuters reported. The new scheme will apply to existing beneficiaries of the GSP – these include 47 countries in the Least Developed Countries Framework, such as Angola, Malawi, Mozambique and Zambia. It will also apply to 18 additional countries – classified as low-income and lower-middle-income countries by the World Bank.
According to a policy paper issued by the State Secretary for the UK’s Department of International Trade, Anne-Marie Trevelyan, the scheme will offer lower tariffs and simpler rules of origin requirements for products exported to the UK. This will make it easier for the world’s poorest nations to export to the UK. BBC reported that the scheme will affect 99% of goods exports from Africa.
South Africa is classified as upper-middle income by the World Bank, which the scheme does not apply to. Nor does the scheme apply to low and lower-middle-income countries with a free trade agreement with the UK. If countries are considered least developed, they can choose to trade with the UK under the DCTS or on free trade agreement terms.
Meanwhile, the UK has halted development aid payments – that are considered non-essential – due to concerns of overspending, Bloomberg reported. It is however, prioritising humanitarian support for Ukraine.
Nine programs for China-Africa co-operation that have yielded fruitful results (The Zimbabwe Mail)
Since its establishment in 2020, the Forum on China-Africa Cooperation (FOCAC) has become an important platform for collective dialogue, an effective mechanism for China-Africa practical cooperation, and a pacesetter for international cooperation with Africa in the new era. At the 8th Ministerial Conference of FOCAC last year, President Xi Jinping put forward for the first time the “spirit of China-Africa friendship and cooperation”. He set forth “four-point propositions” on building a China-Africa community with a shared future in the new era, and announced the “Nine Programs” for practical cooperation with Africa, which have set a new milestone in the history of China-Africa relations. Over the past year, the “Nine Programs” have reaped rich early harvest.
Third, the trade promotion program has made great strides forward. From January to June this year, China-Africa trade volume registered US$137.38 billion, up by 16.6% year-on-year, of which China’s exports to and imports from Africa increased by 14.7% and 19.1% respectively. China has opened “green lanes” for faster export of African agricultural products to China. As a result, agriculture products like the Rwandan stevia, South African fresh pears and soybeans and Zimbabwean citrus have gained access to the Chinese market. China has signed exchange of letters with Togo, Eritrea, Djibouti, Guinea, Rwanda, Mozambique, Sudan, Chad and Central Africa among other LDCs on expanding the scope of zero-tariff treatment to 98% for products exported to China, which covers more than 350 kinds of African products.
Fourth, the investment promotion program is growing against the odds. From January to June this year, China’s industry-wide direct investment in Africa amounted to US$1.74 billion, growing by 1.5% against all the odds. The turnover of Chinese enterprises’ contracted projects in Africa amounted to US$ 18.32 billion, an increase of 8.4% year-on-year. The two sides have set up a China-Africa cross-border RMB center in the pioneering zone for in-depth China-Africa trade and economic cooperation, in an effort to explore RMB settlement for China-Africa trade, logistics and industrial cooperation. China has continued to provide aid in the form of grants, interest-free loans and concessional loans to help African countries achieve independent and sustainable development.
Fifth, the digital innovation program is thriving. The first China-Africa Conference on Innovation Cooperation witnessed signing of 15 China-Africa science and technology cooperation projects. In an effort to expand Silk Road e-commerce cooperation, China and Africa have jointly made a success out of the “Quality African Products Online Shopping Festival”, where coffee from Ethiopia, chili sauce from Rwanda, black tea from Kenya and other high-quality products from a total of 23 African countries were well received among Chinese consumers.
Participants in AfriCaribbean Trade and Investment Forum to benefit from Barbados visa waiver - African Export-Import Bank (Afreximbank)
African participants in the first-ever AfriCaribbean Trade and Investment Forum (ACTIF2022) taking place in Bridgetown, Barbados, from 1 to 3 September will benefit from a decision by the Government to waive visa requirements for passport holders from 24 African countries who would have needed visas to enter the country.
ACTIF2022, which is being held under the theme “One People, One Destiny: Uniting and Reimagining Our Future”, is being hosted by the Government of Barbados and the African Export-Import Bank (Afreximbank).
The 24 African countries to which the visa waiver decision applies are: Algeria, Angola, Benin, Cape Verde, Central Africa Republic, Chad, Comoros, Republic of Congo, the Democratic Republic of the Congo, Côte d’Ivoire, Djibouti, Egypt, Equatorial Guinea, Gabon, Guinea, Guinea-Bissau, Madagascar, Mozambique, Namibia, Niger, Sao Tomé and Principe, Sudan, South Sudan and Togo.
Kay Sealy, acting Permanent Secretary of the Barbadian Ministry of Foreign Affairs and Foreign Trade, said: “The move to add these countries to Barbados’ visa waiver list is intended to enhance business and investment opportunities, and facilitate the ease of travel for tourists.”
Global economy
New digital tools to help maritime economies overcome trade disruptions (Daily Cargo News)
THE UNITED Nations Conference on Trade and Development is launching new digital tools to help maritime countries and ports reinforce supply chains against disruptions. UNCTAD said vulnerable economies in particular had been impacted by extreme weather events, the war in Ukraine and other crises beyond the pandemic adding pressure to global supply chains. “Ensuring the integrity and effective functioning of maritime transportation is critical for all economies, especially small island developing states and least developed countries,” UNCTAD said in a statement.
“These vulnerable economies depend heavily on maritime transport networks for their livelihoods and access to the global marketplace. “Moreover, they are already burdened by disproportionately high transport costs and low shipping connectivity, which make their trade uncompetitive, volatile, unpredictable and costly.”
In light of the consequences felt around the world, UNCTAD has launched a new website to promote “resilient maritime logistics in the face of disruptions”.
These economies are set to lead shipping’s green transition (WEF)
Shipping accounts for close to 3% of global greenhouse gas (GHG) emissions. The latest IPCC reports have shown a pressing need to decarbonize all sectors, including heavy industry, and align with the goal of no more than 1.5°C of warming outlined in the Paris Agreement.
The International Maritime Organization (IMO), through its initial Greenhouse Gas Strategy, aims to halve shipping emissions by 2050, compared with 2008 levels. As the industry seeks to raise climate ambition and align with science-based climate targets, there has been a push for full sector decarbonization by 2050.
This ambitious goal will require huge amounts of scalable zero-emission fuels — that means it also constitutes a major economic opportunity for countries with the potential to produce, bunker and export this kind of fuel, including many developing and emerging economies.
Food security issues worsen globally, says World Bank (ESI-Africa)
In their latest Food Security Update the World Bank highlights that domestic food price inflation remains high around the world. High inflation continues in almost all low- and middle-income countries and the share of high-income countries with high inflation has increased sharply.
The most affected countries are in Africa, North America, Latin America, South Asia, Europe and Central Asia. In real terms, food price inflation exceeded overall inflation (measured as year-on-year change in the overall CPI) in 81% of the 153 countries for which food CPI and overall CPI indexes are both available.
This poses a threat to global food security as the planting season starts. “So far, the war in Ukraine has mostly affected countries importing wheat and corn. But many countries, including some major food exporters, are net fertiliser importers.
“Persistently high fertiliser prices may spread to a broader variety of crops including rice, a staple which has not yet seen war-related price hikes. We must act now to make fertilisers more accessible and affordable to avoid prolonging the food crises,” said Voegele.
He goes on to discuss three policy proposals for making fertilisers more accessible and affordable: Countries should lift trade restrictions or export bans on fertilisers; Fertiliser use must be made more efficient, for instance by providing farmers with appropriate incentives that do not encourage overuse; and Invest in innovation to develop best practices and newer technologies that may help increase output per kilogram of fertiliser used.
Importance of cryptocurrency in today’s Era (Ripple Coin News)
Bitcoin tends to have an enticing use case in cross borders remittance. By utilizing cryptocurrencies as a fundamental medium to transfer funds internationally, senders and recipients can now complete the exchange without high remittance fees.
Cryptocurrencies seem to be the utmost awaited revolution in international exchange, and global trade will become a piece of cake after the mass adoption of these digital currencies. Yet the question remains, what are the strengths and threats of cryptocurrencies in terms of international exchange?
Several people have recently explored ingenious ideas involving different altcoins for international exchange. However, digital currencies, which serve as payment and transfer mediums between countries, are often overlooked as a solution to increase overall economic growth.
However, it is difficult to ignore that trade facilitation acts as a catalyst that brings benefits and value to various parts of the world. The World Trade Organization (WTO) claims that around half a billion people save on annual costs from trade in goods and services. Statistics also indicate that trade volume has doubled since the 1980s due to the globalization of the economy and trade facilitation.
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Local news
Customs duty decision delays are hampering billions of rands in investment, says advisory (Engineering News)
Consultancy XA Global Trade Advisors says billions of rands in revenue have been lost to the fiscus owing to long overdue customs duty decision-making, while also having more far-reaching implications for industries and trade and investment. If all of the cases that required changes to customs duties had been finalised – and granted – on time, it would have ensured a collection of R1.25-billion by now, cumulatively, for every case that is long overdue.
Some cases have remained unresolved as long as three years, but XA Global founder and CEO Donald MacKay says tariff investigations should take four to six months, as per the rules of the International Trade Administration Commission (Itac) which is South Africa’s authority on goods movement across borders.
MacKay and his team conducted research into delays experienced with customs decisions at Itac and the ministries of Finance and Trade, Competition and Industry, and found that the average days taken for tariff investigations has increased to an average of 320 days since 2015, compared with an average of 191 days between 2009 and 2014.
Reclamation Group says scrap metal prices to stabilise over 18 months even with an export ban (Engineering News)
Recycling company The Reclamation Group says that, on account of the already installed increased consumer capacity and the advent of new melting facilities already in the pipeline, over the next 12 to 18 months, a free-market situation will once again prevail within the borders of South Africa, which could and should drive scrap metal prices back to current levels and perhaps even beyond.
Like most commodities, pricing drivers for scrap metal are determined by the economic principles of supply and demand. Initially, the short-term excess could drive prices lower, but not lower than a level where it is no longer commercially viable to collect scrap metal, as the consuming industry cannot afford for the flow of scrap to dry up, adds The Reclamation Group chairperson Dave Kassel.
Further, the company highlights some of the good proposals set out in the Department of Trade, Industry and Competition’s (DTIC’s) recently proposed scrap metal export ban policy, including that an enhanced registration system and improved monitoring, policing and law enforcement will help to address the theft of and trading in stolen scrap metal.
The proposed policy will also support the supply of scrap metal to local industry at affordable prices, as well as the creation of downstream industrialisation or beneficiation, in line with the objectives of the Steel Master Plan. The policy would also contribute to the rebuilding of the South African economy, the company states.
Miraa exports to Somalia hit Sh1bn in three weeks (Business Daily)
Kenya has exported miraa worth Sh1 billion to Somalia in under a month since the resumption of trade coming as a major reprieve to growers who had been hit hard when Mogadishu imposed a ban in 2019.Head of Miraa Pyrethrum and other Industrial Crops Felix Mutwiri says the country has so far exported 375 tonnes of the stimulant in the last three weeks. Earnings were, however, slowed down by caps on the tonnage that Kenya is allowed to export to Somalia. Previously, Nairobi was allowed to sell 40 tonnes every day but currently can only ship a maximum of 19 tonnes in the same period.
“We have so far exported 375,000 kilogrammes (375 tonnes) since we resumed exports on July 24,” said Mr Mutwiri. The directorate has licensed nearly 48 traders for export of the commodity under the new miraa laws. Anyone who exports the crop without registration and a license is liable to a sentence of up to three years or a fine of up to Sh5 million under the new regulation. The directorate started issuing export licenses to miraa traders in July after bilateral talks between Kenya and Somali presidents resolved a long-standing trade tiff.
Kenya eyes US companies dumping China in Biden deal (Business Daily)
Kenya is vying to become the manufacturing hub for American companies seeking to relocate or diversify out of China in fresh trade talks Washington opened with Nairobi in July. Industrialisation and Trade Cabinet Secretary Betty Maina said Nairobi will be negotiating a deal that will lay ground for a manufacturing base for the US firms with a key focus on tech factories.
Tanzania’s economy grows by 5.4 percent (The Citizen)
Despite the spillover effects of the war in Ukraine and lingering impact of Covid-19, Tanzania’s economy grew by an impressive 5.4 percent in the first quarter of 2022.This puts the country on track to achieving its 2022 growth target of 4.7 percent. Initially, the government had set itself a target of boosting economic output by 5.5 percent.
However, with the Ukraine war, which saw prices of fuel, cooking oil, wheat and fertiliser, among other essential items, rise due to disruptions of supply chains after the US and its allies imposed sanctions on Russia, Tanzania reviewed its GDP growth targets. Finance and Planning minister Mwigulu Nchemba said in Parliament in June that the country has revised its real GDP growth rate for 2022 to 4.7 percent. But latest data by the National Bureau of Statistics (NBS) shows that Tanzania’s quarterly GDP was at Sh34.9 trillion in the period from January to March, an increase from Sh33.1 trillion that was registered during a similar period last year.
Economist Humphrey Moshi said the positive momentum from the key economic activities coupled with government drive to foster investment ensures the achievement of 4.7 percent growth target and even higher.
Zambia pushes for innovation in agriculture to accelerate food security (Farmers Review Africa)
Zambia’s hosting of the 4th Mid Year African Union summit hosted in the capital Lusaka last July dubbed: “Strengthening Resilience in Nutrition and Food Security on the African Continent” has instilled a call innovative technologies and become the pivot for sustained food security. Inspired by resolutions from the Africa’s Heads of States and Governments summits in Equatorial Guinea capital, Malabo since 2003 to date coupled by the African Union meeting’s theme, Zambia wants to bolster production using innovations and become the continent’s food basket.
To address climate change and other shocks, President Hakainde Hichilema urges Africa to encourage innovation in member states and consider signing and ratifying the Africa risk capacity treaty and open up assistance channels in planning, preparing and responding to these shocks in a timely and cost-effective manner and redress food insecurity.
“We need to raise the levels of productivity in agriculture, emphasise on value addition through Agro-processing, accelerate research in agriculture, emphasise on and increase support to rural farmers whose livelihoods mainly depend on agriculture.” he said in his address to delegates while calling for reliable transport connectivity.
Diamonds have been at the center of Botswana’s growth miracle for decade - but the urgency to diversify is stronger than ever. Although Botswana’s economy has undergone transformation over the past decades, the shift has been largely into non-tradable services, with limited gains in employment, income equality, and export diversification. In addition, Botswana’s high vulnerability to climate change, which affects all major sectors of the economy, underscores the need to strengthen Botswana’s response to climate factors as a basis for renewed, sustainable growth. A positive growth outlook and steps taken as part of the Coronavirus disease 2019 (COVID-19) crisis response should give the government new impetus to accelerate reforms.
Success in diversifying the economy will depend on the decisive implementation of structural measures to increase private sector participation in nonmineral exports and transformative sectors. The dominant role that the government of Botswana still plays in large parts of the economy, particularly through its footprint as a shareholder in companies in the corporate sector, is a critical constraint that inhibits the entry and success of private sector participants. Gaps in infrastructure, access to finance, and skills are additional key constraints to employment and productivity growth. A coordinated approach to financing entrepreneurship and policies to increase uptake of digital finance can help close the gap. Trade barriers are another key cross-cutting constraint for the private sector, and a greener path for the economy can be unlocked by facilitating improved trade in environmental goods and services (EGS).
Three key recommendations for the energy sector are as follows. The first recommendation is the fast tracking of instruments to facilitate investment in energy infrastructure development, including independent power producer (IPP) licensing, and procurement guidelines and processes. The second recommendation is the enhancement of the institutional capacity and governance model of the Botswana Energy Regulatory Authority (BERA). The third recommendation is the development of credit-enhancement and risk-mitigation strategies and supporting instruments to attract and mobilize private sector investment.
Angola Strengthens Regional Cooperation to foster trade (Energy Capital & Power)
With an agenda to diversify its economy, process more of its raw materials in country and increase trade with its neighbors, Angola has prioritized strengthening regional ties, leveraging global and regional organizations such as the United Nations, the Organization of the Petroleum Exporting Countries, the African Union, the Port Management Association of Eastern and Southern Africa, and the Southern African Development Community (SADC).
The Angolan government seeks to boost refining capacity for crude oil and other associated petrochemicals within Angola to supply an ever-growing SADC market. This it hopes, will not only ensure increased value creation for Angola but will also ensure supply security for Angola and the region as well as help to boost sectors like agriculture and power generation in the region that are dependent on by products like fertilizer and gas.
Nigeria: FG inaugurates committee to ban foreigners from direct trade with farmers (Daily Trust)
The Minister of Industry, Trade and Investment, Otunba Niyi Adebayo, has said the inability to harness the potential of the non-oil sector for meaningful economic growth is why the federal government plans to stop foreigners from direct purchase of farm produce from farmers.
The Federal Executive Council (FEC) had in March approved a memo that would ban foreigners from purchasing farm produce directly from farmers. He said, “The exploitation of farmers by foreigners who come to Nigeria to mop-up agricultural commodities at the farm-gates and in turn offer farmers prices below market value has become a national problem. “The current practice of direct purchases of agricultural commodities at unfair prices by foreigners at our farm-gates poses serious dangers which include: reduction in farmers’ income, declining productivity in the agricultural sector, unemployment and insecurity.” The minister charged the committee to raise the implementation mechanism.
NPA plans new tariff for transshipment, transit cargoes (New Telegraph)
Nigerian Ports Authority (NPA) is planning to come up with a new tariff regime that will encourage transshipment and transit cargoes back to Nigeria. The Managing Director of the authority, Mohammed Bello-Koko, disclosed this in Lagos when the Minister of Transportation, Muazu Sambo, inspected the Lekki Port project.
He stressed that the Authority would procure Vessel Tracking System (VTS) for the Lekki channel and other port locations in the country, stressing that the NPA was in discussions with Lekki Port operators on African Continental Free Trade Agreement (AfCFTA). Bello-Koko added that approval of the minister on the tariff would be sought when concluded, stressing that the operationalisation of the port before the end of 2022 would help Nigeria take full advantages of AfCFTA.
He explained: “We are already in discussion with them on tariff on transit and transshipment cargoes, these kinds of cargoes are sensitive to tariff, it means that it is coming to this port before it gets to final destination. “This discussion is taking place and we would come back to the Honorable Minister of Transportation for necessary approvals that would encourage transit and transshipment cargoes back to Nigeria, this was happening at Tin Can and Apapa on the early days, but before because of the multiple checkpoints on the highway. “If transit cargoes come here, it would be loaded on smaller vessels from the mother vessels and moved to other countries, this would be of economic advantage to Nigeria.”
EU commits to strongly support Nigeria’s reform (WorldStage)
The European Union (EU) has said it was committed to strongly supporting Nigeria’s reform both at the federal and state levels. EU Ambassador to Nigeria and ECOWAS, Ms Samuela Isopi said this on Tuesday in Abuja at the United States Agency for International Development (USAID) State2State inaugural Policy Dialogue Series. The event had as its theme, “Post-State Fiscal Transparency, Accountability, and Sustainability (SFTAS): Incentivising Reforms.”
“At their core, reforms encourage transparency, accountability, fair and efficient distribution of resources and help countries make the most of their human and economic potentials. “For Nigeria, reforms are important in order to capitalise on the country’s many endowments, mineral resources, and human capital, which is especially represented by its young population.
Nigeria to export 99% of goods duty-free to UK from 2023 – High Commission (Businessday)
Develop resilient systems, policies to absorb economic shocks – Prof. Quartey (The Business & Financial Times)
Director of the Institute of Statistical Social and Economic Research (ISSER) at the University of Ghana, Professor Peter Quartey, has urged government to develop resilient systems and policies to absorb some of the economic shocks that are posing difficulties in the country.
He said though the economy will continue to face challenging times for a while, there are prospects ahead depending on how well and smartly government tackles its domestic policies. “We are in challenging times. However, we have to fashion-out resilient systems and policies to absorb some of the shocks. Unfortunately, our economy remains fragile; and therefore we have not been able to accommodate shocks from the global happenings which affect us very well.
African trade and integration
Mene, AfCFTA scribe, urges member-states to domesticate continental trade treaty (Businessday)
African countries have been charged to urgently domesticate the provisions of the African Continental Free Trade Area, (AfCFTA) treaty to fast-track the continent’s economic progress. Secretary-General of the AfCFTA, Wamkele Mene made the call recently in Accra, Ghana at the maiden edition of the Ghana Trade Policy Enlightenment Summit for Foreigners, GaTPES2022. GaTPES2022, which was held under the theme ‘Helping foreign businesses to better navigate the trade policy landscape’, was organised by Ghana’s premier travel company, Standard Travel and Tour, STT.
Mene urged state-parties to the AfCFTA agreement to use its provision to build their economies and transform lives. “The agreement, which is the treaty, needs to be translated into laws; and those laws are then used by the business person in order to do business, and to put money in the pockets of the business person, and to put money in the economy of the country at large,” Mene stated.
AfCFTA post implementation impact on tax revenue mobilisation (The Business & Financial Times)
Experts adopt report recommendations to implement regional industrial policies (UNECA)
Experts from the Economic Commission for Africa (ECA), Sub-Regional Office for Southern Africa (SRO-SA) and the Government of Zambia held a two-day National Action Planning workshop from 10th to 11th August 2022 on the alignment and harmonization of regional and national frameworks on industrialization. The major objective of the event was to develop action plans on promotion and implementation of regional and national industrialization policies for inclusive and sustainable development in Southern Africa.
Tracking gender progress in SADC – as region launches gender and development monitor (SADC)
SADC Member States using the Proportional Representation electoral system combined with quotas have a higher representation of women in Parliament, while those using the First Past The Post system produce the least desirable results. This is one of the key findings of the SADC Gender and Development Monitor 2022 that was launched here in Kinshasa, the Democratic Republic of Congo ahead of the 42nd SADC Summit of Heads of State and Government scheduled for 17-18 August.
According to the SADC Gender and Development Monitor 2022 using official data submitted by member states, Eswatini and Botswana are at the bottom of the SADC regional gender table in 15th and 16th place and have the lowest representation by women in the National Assembly with just 12.2 percent and 11.1 percent respectively.
The SADC Executive Secretary, His Excellency Elias Magosi said gender equality in the region is anchored in the Regional Indicative Strategic Development Plan (RISDP 2020-2030) as well as other regional documents such as the SADC Gender and Development Protocol that was revised and amended in 2016. The SADC Gender and Development Protocol is an instrument for gender equality and women’s empowerment in SADC Member States.
Blinken attaches security, rights to conditions for trade with Africa (The East African)
Washington says it is interested in supporting trade and environmental conservation in the Democratic Republic of Congo and Rwanda, as long as both countries can tie loose ends on security and civil liberties. Last week, US Secretary of State Antony Blinken toured Rwanda and DR Congo, where he raised the matter of the M23 rebels and allegations that Kigali has funded the group to attack civilians and military bases in DR Congo. Kigali denies the charge.
At a joint press briefing last Thursday with Vincent Biruta, Rwanda’s Foreign Minister, Blinken said Washington supports “African-led mediation efforts” that are being led by Kenya and Angola, to bring peace, security, and stability to the eastern Congo. He said the funding of rebel groups should stop.
DR Congo Foreign Trade Minister Jean-Lucien Bussa said the DRC’s decade long exclusion from Agoa was a punishment. Bussa cited more than $623 million in exports to the US, mostly agricultural products, in 2010, compared with just $21 million in 2019 at the height of the ban. “This trade between the DR Congo and the US amounted to about $100 million during the exclusion while Angola trades over $2 billion with the US state, South Africa around $3 billion and Nigeria trades up to $6 billion,” according to the new DR Congo Chamber of Commerce.
US policy to tackle climate change, boost investments (The East African)
The US says its future co-operation with Africa will focus on trade, and investment to reinvigorate its waning influence on the continent, and has also pledged to boost digital initiatives, fight climate change, and deliver Covid-19 vaccines.US Secretary of State Antony Blinken unveiled the strategy last week in South Africa during his five-day tour of sub-Saharan Africa that included earlier visits to DR Congo and Rwanda. Blinken says Africans must choose their partners well as the US competes for influence on the continent with Russia and China.
“It’s a strategy that reflects the region’s complexity – its diversity, its power and influence – and one that focuses on what we will do with African nations and peoples, not for African nations and peoples,” Blinken said.
But during his trip, Blinken downplayed criticism of the US, that it had ignored Africa over the past decade, lacked a coherent policy on how to engage the region, and was instead now keen on the relationship to counter increasing Russian and Chinese influence.
Google backs Kenyan e-logistics company Lori Systems to help bring digital transport management to the African continent (Business Insider Africa)
Lori Systems, the e-logistics company digitising haulage and providing shippers with solutions to efficiently manage their cargo and transporters, is today announcing an investment from Google. This new investment is the third from Google’s $50 Million Africa Investment Fund, which CEO Sundar Pichai announced in October 2021. It comes off the back of the launch of Google’s first product development centre on the continent, in Nairobi, Kenya, the city where Lori Systems first launched.
Named by the Financial Times earlier this year as Africa’s seventh fastest-growing company, Lori Systems has helped thousands of shippers and carriers move over $10B of cargo across the continent since its founding in 2017. A pioneer in e-logistics in Africa, Lori Systems lowers the cost of goods by eliminating pain points along the cargo journey: seamlessly connecting shippers to transportation, providing shippers with solutions to efficiently manage their cargo and transporters, and digitising their entire transport operations from sourcing transportation to documentation and payments.
According to Knight Frank’s Logistics Africa report, 75% of the price of a product in Africa is attributed to logistics (compared to just 6% in the U.S.). On the continent, logistics operators face a host of problems, from fragmented supply and demand markets to inconsistent pricing, paper documentation and little or no access to financing.
Jean-Claude Homawoo, Lori Systems Co-founder & CPO, comments, “In recent years, the global logistics industry has seen much innovation. However, global supply chains are in dire need of modernisation, with technologies yet to reach a critical scale. On the continent, the African Continental Free Trade Area (AfCFTA) is expected to lead to an 81% increase in intra-African trade, providing a $21.9 Billion opportunity in untapped trade potential that the 54 ratifying countries are hoping to capitalise on over the next five years. Logistics is key to unlocking this opportunity.”
Global economy
A World in Crisis Needs Both Trade and Aid (Inter Press Service)
We are in the toughest period the world economy has faced since the creation of the multilateral system more than three-quarters of a century ago. A quadruple shock of COVID, climate change, conflict and cost-of-living has undone years of hard-fought development gains. As financial conditions tighten, even countries that had seemed on track to prosperity and stability now stare into the abyss of debt distress, fragility and uncertainty about the future. Coordinated, multilateral action is necessary to tackle the crises we face. Both aid and trade have key roles to play in reversing the impacts of this quadruple shock and putting the world back on track to achieve the Sustainable Development Goals.
To guide aid and trade towards a better world, policymakers need to pivot in three fundamental ways. First, make trade greener. Second, make trade more inclusive. Third, make trade more connected.
At the invitation of the Government of Turkmenistan and the United Nations Office of the High Representative for the Least Developed Countries, Landlocked Developing Countries and Small Island Developing States (UN-OHRLLS), the Secretary General of the World Customs Organization (WCO), Dr. Kunio Mikuriya, participated through video messages at the Ministerial Transport Conference of Landlocked Developing Countries (LLDCs) in Turkmenbashi, Turkmenistan, on 15 and 16 August 2022. He stressed the importance of Customs and the contribution of the WCO in improving border procedures to support transport infrastructures and associated financing for better connectivity at borders for transit.
In his opening speech, Dr. Mikuriya explained the WCO instruments in support of trade facilitation, such as the Revised Kyoto Convention (RKC), and mentioned the importance of political support, as recently demonstrated by Turkmenistan in ratifying the RKC. He also mentioned other WCO tools such as the Transit Guidelines and the related Compendium of best practices that illustrated Members’ good practices. He expressed the WCO’s commitment to providing capacity building support to implement its standards and working with its partners, in line with the current and future international framework to support LLDCs and the Sustainable Development Goals.
Additional U.S. Contribution to the World Food Programme (US Department of State)
We announced today that, through USAID’s continued partnership with the World Food Programme (WFP), the U.S. Government will contribute more than $68 million to support the procurement, transport, and storage of up to 150,000 metric tons of Ukrainian wheat to address acute food insecurity. This sum represents the latest in more than $5.4 billion in humanitarian contributions from the United States this fiscal year. The purchase of 150,000 metric tons of wheat builds on an initial WFP shipment of 23,000 metric tons of Ukrainian wheat and will support the humanitarian response in the Horn of Africa, where a historic drought is pushing millions of people to the brink of starvation.
While the resumption of exports from Ukraine’s Black Sea ports is a positive step in addressing the needs of food insecure countries, these shipments must continue so that the millions of tons of food trapped in the country can reach markets and help feed the world’s most vulnerable.
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S.African coal exports to Europe surge, shipments to Asia decline (Reuters)
South Africa’s coal sales to Europe rose eight-fold during the first half of 2022 compared with last year as demand for the fossil fuel surged ahead of a ban on Russian coal, Thungela Resources said on Monday.
In April, the European Union announced a ban on coal imports from Russia as part of sanctions for its invasion of Ukraine. The ban came into effect on August 10. Ahead of the ban, European countries, which previously imported 45% of their coal from Russia and have been switching away from expensive natural gas to coal, started to source the fossil fuel from other countries, including South Africa.
We refuse to be bullied by the West, South Africa declares (The East African)
In their talks, Ms Pandor and Mr Blinken touched on extending South Africa’s trading partnership with the United States. At a meeting with visiting US Secretary of State Antony Blinken on Monday, South Africa’s Minister of International Relations and Cooperation Naledi Pandor said her country will only make independent decisions.
Exponential growth on imports from South Africa to the United Kingdom (Business Matters)
If the growth in imports is any indicator of quality, then grapes (both in their liquid and natural form) from the Western Cape are among the best in the world. Over the 2020/21 reporting period, the UK imported 16% more wine products and 15% more grapes than they did the year before. This is according to, South Africa’s official tourism, trade, and investment agency in the Western Cape, Wesgro.
Products profiled on the Cape Trade Portal, an online resource that connects exporters and importers, are not just grapes that have piqued British interest. Beverages, spirits and vinegar, tobacco, vegetable products, and fruits are among the other top performing exports from the province. Other exports such as yachts and paintings saw spike in demand of more than 100% from the British Isles.
The Cape Trade Portal provides overseas buyers access to locally produced premium products and services by Western Cape makers.
South Africa’s ‘tech hub’ draws billions in investment (BusinessTech)
The Western Cape has received R103 billion in Foreign Direct Investment (FDI) in its technology sector, according to the Democratic Alliance, solidifying its place as the ‘tech hub’ of South Africa. Cayla Murray, a spokesperson for the opposition party, said that between 2011 and 2021, the Western Cape has seen billions of foreign investments flow in. According to the Department of Economic Development and Tourism (DEDAT), total FDI has been split across the following sectors: Communications – R55 billion, making it one of the largest contributions to the Western Cape; Renewable energy – R18 billion, approximately 13.36% of total FDI, which is promising news for the country’s energy crisis; Business services – R16 billion, and; Software and ICT services – R13 billion, which has been funnelled into 61 projects across the province.
In a 2021 report from fDi Intelligence, a data division of the Financial Times group, Cape Town was revealed to be one of the world’s fastest-growing regions for foreign direct investment. On top of investment, the province has become a hotbed for startups, with the Cape Town – Stellenbosch corridor containing 450 tech firms employing more than 40,000 people, according to Wesgro.
Zimbabwe’s diaspora remittances hit US$800 million (Bulawayo24 News)
ZIMBABWE’S diaspora remittances reached US$797 million in the first six months of the year, representing a 23 percent increase in the corresponding period last year. An estimated three million Zimbabweans are believed to be in the diaspora and they regularly send money back home to sustain their families. In his mid-term monetary policy statement presented last Thursday, Reserve Bank of Zimbabwe (RBZ) Governor Dr John Mangudya said: “Of the total amount, diaspora remittances amounted to US$797 million, a 23 percent increase from US$650 million received during the same period in 2021.” Economic analysts have urged the Government to craft policies that attract Zimbabweans in the diaspora to channel their financial resources beyond domestic consumption as they have a key role in transforming the economy.
Kenya: Horticulture exports fall Sh35bn on poor avocado fruit, lower volumes (Business Daily)
Horticulture earnings dropped by Sh32 billion in the first half of the year on the back of reduced returns from flowers, vegetables and fruits. The Horticulture Directorate says the value of export produce declined by 40 percent to Sh48.4 billion from Sh80.7 billion in the corresponding period a year earlier. The regulator says the value was pulled down by a decline in volume and lower quality avocado in the first quarter of the year as the exported products were not mature enough. This led to low value realised and more rejections of the produce in the world market.
“There was a huge decline in volumes in the review period that pulled down the overall earnings. We also had issues with our avocado,” said the directorate.
Flowers normally make the largest share of the total horticulture export earnings as they are high-value crops. Earnings from horticulture exports hit a historic high last year at Sh158 billion to remain the leading foreign exchange earner in the last two years by staying ahead of tea and tourism.
The good results were boosted by the high demand for Kenyan produce in the world market last year, according to the Directorate of Horticulture.
Prices of sugar up by 18pc on shortage (Business Daily)
A sugar shortage following the closure of some mills for maintenance has pushed prices up by 18 percent in one week. The price of a 50 kilogramme bag is now selling at a high of Sh6,400 from Sh5,400 last week, putting more pressure on the households at a time when they are grappling with high cost of other basic commodities. At the supermarkets, a two kilogramme packet of the commodity is selling at Sh270 in the last two days from a low of Sh239, a price that it has been retailing at for nearly a year.
Head of Sugar Directorate Willice Audi said the directorate is yet to get up-to-date figures in regard to the supply of the commodity in the market but said there was no problem with local supplies from the factories. Kenya cut sugar imports by nearly half in June when compared with the previous month as cane production jumped 11 percent in the review period. Kenya is allowed to import up to 350,000 tonnes of sugar from the Comesa countries to bridge the annual local deficit.
Cargo movement slows down as truck owners avoid roads (The Star Kenya)
Cargo movement between port facilities and final destinations has slowed as truck owners opt to park their vehicles, as they monitor the political environment in the country.
The situation has brought to a near stop of operations by haulers operating within Kenya and the neighbouring countries that use the Port of Mombasa and the Nairobi Inland Container Deport (ICD). This is despite a high number of vessels discharging imports at the Mombasa.
Kenya Transporters Association (KTA) yesterday reported few activities on the Kenya roads and the 1,700 kilometre long Northern Corridor that runs between Kenya, Uganda Rwanda, Burundi and Eastern D.R. Congo.
A stop in the movement also comes with losses where according to the association, a single truck incurs a loss of $200 (about Sh23,880) on average, per day. At least 1,200 trucks cross the Malaba border into Uganda daily with about 300 using the Busia border.
Kenya: Manufacturers, traders top gainers in bank credit (Business Daily)
Trade and manufacturing were the biggest gainers in loans to the private sector, according to data from the Central Bank of Kenya (CBK).The latest financial stability report shows these sectors were most attractive to lenders with trade accounting for 17.1 percent and manufacturing accounting for 15.2 percent of the industry’s loan book in the year to June. Households took 14.9 percent of the loans while real estate accounted for 12.7 percent of the private sector credit in the period under review.
“The economic sectors most attractive to lenders included manufacturing, trade, households, transport and communications and real estate,” the report read in part.
Manufacturing has received more than Sh488 billion in loans cumulatively while trade and real estate got Sh549 billion and 407.7 billion respectively. Lending to households on the other hand was in excess of Sh478 billion.
Uganda scraps tax on imported rice from Tanzania (The East African)
The Ugandan government has scrapped the Value added Tax (VAT) on imported rice from Tanzania. The development comes two weeks after Uganda’s President Yoweri Museveni appealed to all the seven East African Community (EAC) member states to remove all non-tariff barriers, saying they were hampering economic integration and development in the region.
“All rice originating from the Republic of Tanzania and with a certificate of origin according to preferential treatment will effective July 27 attract a 0 percent import duty in accordance with paragraph 1(L) of the third Schedule to the VAT Act and Article 15 of the Protocol establishing the East African Community Customs Union,” said. Assistant Commissioner for Trade at Uganda Revenue Authority, Mr Alexander Rubanda.
Zimbabwe and Zambia held an ad-hoc expert group meeting (AEGM) on the draft policy, legal, regulatory and institutional framework for a Common Agro-Industrial Park (CAIP) and on the assessment study report on maize and dairy value chains in the two countries at Rainbow Towers in Harare.
The objective of the AEGM on the CAIP was to review and validate the draft policy, legal, regulatory and institutional framework to specifically assess its appropriateness for the development and sustainability of the park.
The assessment of the report on maize and dairy value chains in Zambia and Zimbabwe sought to review the findings and recommendations from draft report and provide recommendations for the advancement of the development of the two value chains in and between the two countries.
The maize and dairy value chains are among the nine identified in the pre-feasibility study as anchors of the CAIP and are among the identified strategic value chains in both COMESA and SADC regions. The validated policy, legal, regulatory and institutional framework and the report on the assessment of the maize and dairy value chains will both be finalized taking into account the observations and recommendations of the AEGM.
Nigeria: An Emerging Strategic Partner To Europe’s Energy Transition (Seeking Alpha)
Nigeria could be emerging as a key strategic partner to Europe’s energy transition, and the Franco-Nigerian relationship is at its heart. University research subsidies, funds for economic development, corporate partnerships, and new refinery contracts are only a few of the many increasing ties linking the European Union to Nigeria in a nascent strategic partnership that addresses the heart of both blocs’ economic and political issues.
Oil-rich, natural gas-rich, and equipped with many of the REM resources necessary for sustainable development, Nigeria boasts a large, increasingly urbanized population, as well as a stable financial hub in Lagos and a semi-democratic government with the highest levels of economic prosperity in the continent (with the exception of South Africa). Nigeria’s substantial resource wealth and geographic proximity to Europe make it a very attractive partner for meeting the continent’s energy needs.
Europe’s search for energy independence from Russia has the potential to make it a partner in Nigeria’s economic development. With a massive capital investment base and substantial expertise in the energy market through juggernauts such as Total (TTE) and Shell (SHEL), Europe has the necessary elements to build out the as-yet underdeveloped Nigerian energy sector. This would mean substantial economic benefits for Nigeria, building on its status as a major sub-Saharan trade hub. Due to these opportunities, opening up to trade with Europe has been more of a focus of the Nigerian government. Nowhere are these ties strengthening more quickly than between France and Nigeria.
African trade and integration news
AfCFTA: African Tripartite Business Council Established (KT Press)
Three Eastern Africa regional business councils have officially formed a continental business council, to spearhead the inclusion of private sector policy proposals into the negotiations of African Continental Free Trade Area (AfCFTA) Agreement and the African Tripartite Free Trade Area (TFTA). Under the name African Tripartite Business Council, the council brings together the East African Business Council (EABC), Common Market for Eastern and Southern Africa (COMESA) and Southern African Development Community (SADC). This formation is one of the resolutions from a Consultative Meeting of Regional Business Councils on the Implementation of the AfCFTA Agreement held in Kigali City on August 10-11. “The African Tripartite Business Council will put forward joint private sector policy positions to the AfCFTA Secretariat in Ghana and Tripartite Ministerial Council Meetings in order to accelerate the implementation of the Agreements,” said John Bosco Kalisa, EABC CEO.
Kalisa called upon the Member States from COMESA, EAC and the SADC to ratify the Tripartite Free Trade Area to achieve the threshold of 14 ratifications required to enable the agreement to enter into force. Dickson Poloji, CEO of COMESA Business Council said, “It is important for the private sector to be knowledgeable of the trade instruments of Rules of Origin, Standards and Dispute Settlement Mechanism under the AfCFTA.”
Africa: More Education, Awareness On African Continental Free Trade Area Needed - Survey Reveals (Ghanaian Times)
A survey conducted by the Ghana International Trade and Conference (GITFic) on the African Continental Free Trade Area (AfCFTA) initiative has revealed that increased sensitisation is crucial to ensure businesses reap the benefits of the programme. Ninety per cent of the respondents said the AfCFTA was relevant and more education was needed on the programme. Also, 65 per cent of the respondents indicated that the implementation of the AfCFTA would have beneficial effects on their business.
The survey was to assess the views of the business community in the country with regards to the framework of the AfCFTA and the designation of Accra as the “commercial capital of Africa “.
The Lead Researcher said, he was optimistic that the findings of the survey, which was also aimed at serving key stakeholders in trade and industry, would serve as veritable reference for policy makers and key players in the AfCFTA ecosystem.
42nd SADC Summit… addressing the impact of COVID-19 (sardc | Southern African News Features)
Southern Africa must remain vigilant and united in its fight against COVID-19 to ensure sustainable development in the region. The outgoing chairperson of the Southern African Development Community (SADC) Council of Ministers, Nancy Tembo said this at the Council meeting held ahead of the 42nd SADC Summit of Heads of State and Government set for 17-18 August in Kinshasa, the Democratic Republic of Congo.
Tembo, who is the Minister of Foreign Affairs of Malawi said the SADC region has made significant progress to contain and address the impact of COVID-19, but the pandemic is still a serious concern.
She said it is within this context that the region supported the implementation of its planned activities under the theme of “Bolstering Productive Capacities in the Face of COVID 19 Pandemic for Inclusive, Sustainable Economic and Industrial Transformation”, which was agreed at the previous Summit held in Malawi last year.
The 42nd SADC Summit is running under the theme “Promoting industrialization through, agro-processing, mineral beneficiation, and regional value chains for inclusive and resilient economic growth.” The theme continues with the industrialization trajectory, as SADC has since 2014 held its summits under the industrialization theme.
From FX scarcity to tariff hikes... importers, agents lament rising cost of doing business (TheCable)
Trade is the main engine of development strategies because of the implicit benefits on job creation, expansion of markets, incomes, and facilitation of competition. According to the World Trade Organisation (WTO), the main thrust of trade policy is the enhancement of the competitiveness of domestic industries to stimulate and promote diversified export trade.
Trade policy also seeks to create an environment conducive to increased capital inflows, transfers and adoption of appropriate technologies. But manufacturers, traders, importers, and clearing agents in Nigeria have continued to express worries over the hike in tariffs by the Nigeria Customs Service (NCS), the scarcity of dollars and the lack of basic infrastructure facilities within the nation’s ports.
In April, the Nigeria Customs Service (NCS) migrated from the old version of the ECOWAS Common External Tariff (2017- 2021) to the new version (2022- 2026). The development will see importers paying a 20 duty fee and another 15 percent levy for automotive policy. A statement signed by Timi Bomodi, public relations officer, in the office of the Comptroller-General of Customs, said that the migration was in-line with the World Customs Organisation (WCO) five-year review of the nomenclature, where the contracting parties are expected to adopt the review based on regional considerations and national economic policy.
How logistics can be a boon for African trade (TechCabal)
Logistics is the backbone of international trade; without a working system of moving goods around the world, trade would be hindered. In the African tech ecosystem, investment in tech-enabled transportation and logistics start-ups in Africa has increased since 2015. Last year, a total of $388 million was invested in the sector, and over 30 transport and logistics companies secured funding, making the sector part of the top 5 by funding on the continent.
There are, however, some major challenges that still linger in the ecosystem, such as complex custom processes, heavy import costs and intra-trade barriers, high shipment levels, and port handling charges, among others. At a webinar titled “ What’s the future of logistics in African markets?” on Friday, July 15, TechCabal sought to seek out solutions to this complicated conundrum from the perspective of industry experts.
Carlos Lopes: Africans must not develop new dependencies (African Business)
Carlos Lopes, professor at the University of Cape Town, former executive secretary of the UN Economic Commission for Africa and expert on African economies, policy and geopolitics, sees a future for the continent with new fault lines and new allegiances that are threatening the current consensus. In a wide-ranging interview shortly after the June meeting of the G7, he tells us what he thinks is at stake and what Africa’s position should be.
How can Africa reorganise priorities and shape its strategy when the continent is once again in a crisis and being pressured by all sides?
A: We have evidence of this difficulty in relation to the pressure being exerted to take a position on the Ukrainian issue. Most African countries are not interested in taking a position for obvious reasons. They are familiar with the logic of the Cold War and do not want to enter a game where you have to take a position. Each time this has happened, we have lost a set of partners and become even more dependent on the partner we choose to support. I don’t see the case for it. And I can’t imagine an African country wanting to depend on Russia or China. Similarly, I can’t see African countries wanting to depend only on the goodwill of Western countries either.
That’s why it makes sense to stay somewhat outside this obvious polarisation. This period in which African countries have to navigate in troubled waters will be extremely difficult. Depending on what is done with the AfCFTA, they may or may not be able to count on a much more active and energetic Africa. If we fail to implement the AfCFTA, we will lose a considerable amount in terms of our negotiating hand and we will remain under enormous pressure [given our dependence on external partners].
Many countries are capable of understanding the future of Africa. It is a demographic future and a future of strategic resources for the transitions I mentioned. But it is also a future important partner in terms of trade and a large consumer market of 2bn people.
Finally, what needs to be closely monitored in this period of serious crisis so that African countries do not worsen their predicament?
A: In the short term, we need to focus on three things. First, the negotiations on the debt issue in Africa have gone somewhat round in circles. The three mechanisms that were put in place during the pandemic have not produced much in the way of results. We also need to look at the way the current international institutions are structured. We saw that international bodies were not up to the task of dealing with the latest crises. They don’t have quick and consistent instruments to respond to this kind of crisis. Africans must not accept a new wave of pandemic-like measures. The crisis is getting worse, so we need to question the instruments. I think this discussion has already started.
These 10 Sub-Saharan African countries earn the lowest dollars from their exports (Business Insider Africa)
For most developing countries in Africa, foreign trade is imperative. For one, these countries need to import the many products and services they can’t produce. Also, exporting their products (mostly raw materials) gives them the opportunity to earn much-needed hard currency and bolster their foreign reserves.
For the rest of this article, we shall focus on fifteen African countries that earn the highest foreign exchange through exports of products and services. This is particularly important now that many African countries, from Nigeria to Kenya, are grappling with chronic dollar shortages. Perhaps the answer to the problem is for these countries to find ways to export more products and services so they can earn more forex.
Below are the ten African countries that earn the lowest forex through exports. The list is courtesy of available data obtained from The World. Comoros - $87.7 million; Burundi - $145.1 million; The Gambia - $199.8 million; Guinea Bissau - $205.9 million; Central African Republic - $357 million; Eritrea - $374.8 million; Cabo Verde - $476.6 million; Sierra Leone - $613.1 million; Sudan - $772.8 million; Lesotho - $911.3 million
Zambia can be Southern Africa’s “grain basket”: Experts (Farmers Review Africa)
African countries face great challenges in adapting to climate change to meet growing demand for food with the current drought in East Africa being the latest manifestation of changing weather patterns. But, according to experts, countries such as Zambia, where there is good land and water, have major opportunities to meet food demand by growing agriculture exports and processing their produce.
Zambian farmers can earn substantial returns from increased production. Their production can also alleviate the pressures in countries such as Kenya. “To realise these opportunities, Zambian products have to reach export markets at good prices. For this, Zambia needs competitive cross-border markets and efficient transport and logistics services,” Antony Chapoto, the research director at the Indaba Agricultural Policy Research Institute (IAPRI), Ntombifuthi Tshabalala, an economist at Centre for Competition, Regulation and Economic Development, University of Johannesburg, and Simon Roberts, a Professor of Economics and Lead Researcher, Centre for Competition, Regulation and Economic Development at the same university, noted.
“However, regional grain and oilseeds trade is not working for producers in Zambia or for buyers in East Africa, with huge variances in agricultural commodity prices in Kenya and in Zambia.” They said there “reality check” on the workings of cross-border markets points to regional integration being the key to unlocking massive potential for Zambia to anchor sustainable agricultural growth in Africa. But effective regional integration remains a dream, undermining Zambia’s potential.
Illegal Logging in Africa and Its Security Implications (Africa Center for Strategic Studies)
Illegal logging is a growing feature of transnational organized crime in Africa, often facilitated by the collusion of senior officials, with far-reaching security and environmental implications for the countries affected.
African countries are estimated to lose $17 billion to illegal logging each year. This is part of a global market with an economic value of $30 to $150 billion. The net profit from the illegal charcoal trade alone in Africa is estimated to be as much as $9 billion, “compared to the [$]2.65 billion worth of street value heroin and cocaine in the region.” High-value timber species are in immense global demand, with the United Nations Office on Drugs and Crime (UNODC) reporting that Africa’s share of rosewood exports to China rose from 40 percent in 2008 to 90 percent in 2018.
Illegal logging is part of a vicious cycle of opaque governance, exploitation, and insecurity that privileges the profit-seeking of select state officials and foreign actors. These patterns reduce the legitimacy of the government overall, further contributing to instability and violence.
Global economy
New trading scheme cuts tariffs on hundreds of everyday products (GOV.UK)
The UK is using its post-Brexit powers to launch one of the world’s most generous trading schemes with developing countries today. The International Trade Secretary Anne-Marie Trevelyan has launched the new Developing Countries Trading Scheme (DCTS), which will extend tariff cuts to hundreds of more products exported from developing countries, going further than the EU’s Generalised Scheme of Preferences. This is on top of the thousands of products which developing countries can already export to the UK duty-free [and will mean 99% of goods imported from Africa, for example will enter the UK duty free].
The scheme means that a wide variety of products – from clothes and shoes to foods that aren’t widely produced in the UK including olive oil and tomatoes – will benefit from lower or zero tariffs. The Developing Countries Trading Scheme ensures that British businesses can benefit from more than £750 million per year of reduced import costs, leading to more choice and lower costs for UK consumers to help with the cost of living.
World Trade Organization General Council, July 2022: UK statements (GOV.UK)
Renewed Ukraine grain exports helping lower food prices, World Bank economist says (The Japan Times)
The resumption of shipments from Ukraine is helping drive down the cost of grain, with wheat prices expected to stabilize should trade continue to flow smoothly from the country’s Black Sea ports, World Bank Senior Agriculture Economist John Baffes told The Japan Times in an interview. “We believe food prices reached their highest level in the second quarter of 2022,” Baffes said, noting that the World Bank does not expect food prices to increase for the rest of the year, given that most global food markets are adequately supplied.
Global food commodity prices decline in July (FAO)
The benchmark for world food commodity prices declined significantly in July, with major cereal and vegetable oil prices recording double-digit percentage declines, the Food and Agriculture Organization of the United Nations (FAO) reported today. The closely-watched FAO Food Price Index averaged 140.9 points in July, down 8.6 percent from June, marking the fourth consecutive monthly decline since hitting all-time highs earlier in the year. The Index, which tracks monthly changes in the international prices of a basket of commonly-traded food commodities, nevertheless, remained 13.1 percent higher than in July 2021.
“The decline in food commodity prices from very high levels is welcome, especially when seen from a food access viewpoint; however, many uncertainties remain, including high fertilizer prices that can impact future production prospects and farmers’ livelihoods, a bleak global economic outlook, and currency movements, all of which pose serious strains for global food security,” said FAO Chief Economist Maximo Torero.
As fuel prices rise, companies look to energy efficient solutions (UNEP)
A United Nations Environment Programme (UNEP)-led global effort supporting developing countries to move their markets to energy-efficient appliances and equipment. Energy efficiency can take many forms, with U4E focusing on lighting, refrigeration, air conditioning, distribution transformers and electric motors.
“Half of the near-term reductions in emissions in the energy sector can be achieved through energy efficiency, for example, by using more energy-efficient appliances and lighting and more efficient motors,” said Miriam Hinostroza, Head of the Global Climate Action Unit, at UNEP’s Energy and Climate Branch.
GSBN expands Cargo Release roll out to Latin America (Seatrade Maritime News)
Cargo Release is a blockchain-enabled application offering a paperless and transparent solution connecting everyone involved at the port of import including shipping lines, consignees, their agents, and terminals, cutting time for cargo to be document-ready for release from days to hours.
Due to their proximity with North and Latin American markets, Mexico and Panama are strategically important ports for global trade, with both Panama and Mexico amongst the top ten countries by number of port terminals.
“As global trade continues to face an evolving and increasingly dynamic environment, digitisation is playing a critical role in helping the shipping sector adapt. Mexico and Panama are strategically important locations for global supply chains, and we hope the rollout of Cargo Release will help further accelerate the digital leap the shipping sector is undergoing,” said Bertrand Chen, CEO at GSBN.
“The adoption of Cargo Release is essential to reducing the bottlenecks faced by the sector and its latest rollout in Latin America further ushers a modern era for global trade,” explained Zhang Chi, Latin America/Africa Trade Division General Manager at Cosco Shipping Lines
June Air Cargo: Stable and Resilient (IATA)
The International Air Transport Association (IATA) released data for global air cargo markets showing healthy and stable performance. Global demand, measured in cargo tonne-kilometers (CTKs*), was 6.4% below June 2021 levels (-6.6% for international operations). This was an improvement on the year-on-year decline of 8.3% seen in May. Global demand for the first half-year was 4.3% below 2021 levels (-4.2% for international operations). Compared to pre-COVID levels (2019) half-year demand was up 2.2%.
Air cargo performance is being impacted by several factors Trade activity ramped-up slightly in June as lockdowns in China due to Omicron were eased. Emerging regions (Latin America and Africa) also contributed to growth with stronger volumes. New export orders, a leading indicator of cargo demand and world trade, decreased in all markets, except China. The war in Ukraine continues to impair cargo capacity used to serve Europe as several airlines based in Russia and Ukraine were key cargo players.
African airlines saw cargo volumes increase by 5.7% in June 2022 compared to June 2021. As with carriers in Latin America, airlines in this region have shown optimism by introducing additional capacity. Capacity was 10.3% above June 2021 levels. Demand for the first half-year was 2.9% above 2021 levels and half-year capacity was 6.9% above 2021 levels.
Conference opens to draft first-ever treaty on ocean’s biological diversity (UN News)
Amidst calls for flexibility, openness and the spirit of compromise that prevailed in 1982, when the landmark “constitution for the oceans” was adopted, the new treaty will aim to address the conservation and sustainable use of marine biodiversity in areas of the ocean which are beyond the limits of States’ maritime zones. The session, which runs until 26 August, was convened following a decision taken by the General Assembly in May and is expected to be the final in a series set in motion since 2018 to draft an international legally binding instrument under the 1982 UN Convention on the Law of the Sea on the conservation and sustainable use of marine biological diversity of areas beyond national jurisdiction.
Commonwealth Secretary-General highlights importance of SMART governance for closing the digital divide (The Commonwealth)
the Commonwealth Secretary-General, Rt Hon Patricia Scotland QC, spoke at the Management Development Institute (MDI) in New Delhi India, about the importance of closing the digital divide and utilizing strategies such as SMART governance. The Secretariat is exploring with MDI the possibility of setting up a Commonwealth Hub for the Business of Government to help promote SMART governance across Commonwealth countries. While delivering a speech on the theme “Smart Governance for SMART Commonwealth – From Vision to Implementation” at the MDI Gurgaon campus, Patricia Scotland, Commonwealth Secretary-General of the Commonwealth, said:
“In the Commonwealth, only 18 per cent of people living in low-income countries have internet access, compared to 85 per cent in high-income countries. This digital divide continues to limit the potential of countries. Better access to broadband internet through cheaper rates and public access and achieving 50 per cent penetration across the Commonwealth would raise members combined national income by $74 billion to $263 billion. SMART Governance is the process of utilizing modern technologies and ICT to ensure a collaborative, transparent, participatory, communication-based and sustainable environment for citizens and governments. We will work with MDI as a hub for good governance in Commonwealth countries.
Related News
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Local news
Agriculture, Land Reform and Rural Development negotiates a settlement to clear citrus blocked in the EU ports (South African Government)
The new measures include amended additional phytosanitary declarations for grapefruit and soft citrus and revised cold treatment regime for oranges. The Department of Agriculture, Land Reform and Rural Development (DALRRD) confirms that it has managed to negotiate a settlement that will see clearing of citrus containers stuck in ports of entry in the European Union (EU).
Relief! Govt convinces EU to save SA citrus (Food For Mzansi)
Auto manufacturing is changing: how South Africa can adjust to protect workers and jobs (The Conversation)
Technological changes in industry have given rise to contending schools of thought about their impact on work and workers. Automation is rapidly deepening and widening, reaching new areas of work. What’s being produced is also changing. In the automotive manufacturing industry, for example, there is a global shift to vehicles that don’t produce emissions. The ongoing industrial revolution is defined by new work methods, ways of organising production, and advances in technology.
Video: Agoa expiry clause hurting Kenya (Business Daily)
Kenya has struggled to attract long-term, capital-intensive investments under the more than two decades-Growth and Opportunity Act (Agoa) deal with the US largely because of the pact’s expiry clause, the Trade minister has said. The capital investments by the firms grew 20.7 percent year-over-year to nearly Sh23.1 billion, according to data collated by 5he Kenya National Bureau of Statistics from the Export Processing zones.
Tanzania, Zambia cross-border railway unlocks trade ties (Anadolu Ajansı)
The decision to revive the Tanzania and Zambia Railway Authority (TAZARA) was reached last week in the port city of Dar es Salaam where the two leaders held talks. “We strongly support our leaders who have shown political will to upgrade this railway,” he said.
Museveni’s relation with Biden’s America (The Independent)
U.S. Secretary of State Antony Blinken’s recent visit to Africa appears to have cemented the growing perception of a diminished geo-political stature for President Yoweri Museveni. On his second visit to Africa, Blinken from August 7 to 12 visited three countries: South Africa, the Democratic Republic of the Congo (DRC), and Rwanda. In November 2021, Blinken had visited Kenya, Nigeria, and Senegal. The two visits are important signals of the U.S’s leadership’s power play on the African continent and those the superpower regards as the captains of the continent.
Prof. Christopher Isike who is the Director, African Centre for the Study of the United States, University of Pretoria, and his colleague, Associate Professor Tinashe Nyamunda, say Blinken’s recent visit to the three African countries is another sign of the Joe Biden administration’s US-Africa policy of reengaging with the continent. Prof. Isike and Nyamunda point out that in Pretoria, Blinken focused on four priorities that he believed the US and Africa could tackle together.
Ethiopian PM inaugurates first free trade zone (Capital Business)
Ethiopian Prime Minister Abiy Ahmed on Sunday inaugurated the Dire Dawa Free Trade Zone, the country’s first free trade zone. Ahmed said free trade zones would enable Ethiopia to better integrate into a rapidly changing world. The Ethiopian government said the Dire Dawa Free Trade Zone would augment the country’s economy by improving its import and export trade. “The Free Trade Zone we are building is one of our ways to integrate into a rapidly changing world. I have no doubt that the zone will not only facilitate trade and investment but also enhance our technological capabilities,” state-run Ethiopian News Agency (ENA) quoted Ahmed as saying.
Morocco’s road to development highlighted by US think-tank (The North Africa Post)
“Morocco actively encourages and facilitates foreign investment, particularly in export sectors like manufacturing, through positive macro-economic policies, trade liberalization, investment incentives, and structural reforms,” the author of the paper and president of the think tank Paolo von Schirach points out. Morocco also encourages and facilitates foreign investment, particularly in export sectors such as manufacturing, through positive macroeconomic policies, trade liberalization, investment incentives, and structural reforms.
Zambia can meet growing food demand (Moneyweb)
African countries face great challenges in adapting to climate change to meet growing demand for food. The current drought in East Africa is the latest manifestation of changing weather patterns. But countries such as Zambia, where there is good land and water, have major opportunities to meet food demand by growing agriculture exports and processing their produce. Zambian farmers can earn substantial returns from increased production. Their production can also alleviate the pressures in countries such as Kenya.
To realise these opportunities, Zambian products have to reach export markets at good prices. For this, Zambia needs competitive cross-border markets and efficient transport and logistics services. However, regional grain and oilseeds trade is not working for producers in Zambia or for buyers in East Africa, with huge variances in agricultural commodity prices in Kenya and in Zambia.
AfCFTA: FG told to emulate Rwanda, move into Africa, woo investors (Businessday)
The Federal Government has been advised to make haste and emulate Rwanda and other smart African countries to woo African investors and consolidate production structures as the African Continental Free Trade Area (AfCFTA) fast approaches. Investors in Port Harcourt, Rives State and Niger Delta zone, who played host to a Rwandan delegation led by the High Commissioner in Nigeria, Stanislas Kamanzi, warned that whereas Rwanda and some other African countries are creating investment hubs and manufacturing zones to attack Africa, Nigeria seemed to be sleeping. Rwanda had told the Nigerian investors how they make foreign exchange available to investors, how they make power supply and other facilities available, how they register a new business in just six hours, and how they give seven years tax holiday to foreign investors.
National competitiveness body would end manufacturing woes – Oteng Gyasi (The Business & Financial Times)
The country could significantly boost efforts to become a manufacturing hub, attract foreign investments, and create decent jobs by establishing a national competitiveness body, says renowned industrialist, Anthony Oteng Gyasi.
With the country in race against time to position itself as a major player within the continent-wide free trade market, he said a national competitiveness council could help to address some of the issues that make local manufacturers uncompetitive.
“We need a body which will ensure that the things which make industry uncompetitive are reduced, and help us to be competitive as a country,” Mr. Oteng Gyasi, who is the Executive Chairman of Tropical Cable and Conductor, told the B&FT in Accra.
African trade and integration
GITFiC to launch handbook to promote AfCFTA (Ghana Business News)
The Ghana International Trade and Finance Conference (GITFiC) is set to launch a comprehensive handbook that will enhance the level of sensitization on the framework of the African Continental Free Trade Area (AfCFTA). The launch is slated for September 20, 2022, in Accra, the commercial capital of Africa.
Mr Selasi Koffi Ackom, the Chief Executive Officer of GITFiC, made this known at a press briefing in Accra to discuss a survey report by the GITFiC titled; “Assessing the AfCFTA Among the Business Community in Ghana.” He said: “We are glad to state that this handbook contains detailed and simplified information on the framework of the AfCFTA, and particularly delves into key topics such as the Rules of Origin and Trade Remedies, among others, as pertains in the field of international trade.”
How Far Is Eastern, Southern Africa On AfCFTA Implementation (KT Press)
The Eastern and Southern Africa Regional Business Councils on the African Continental Free Trade Area (AfCFTA) agreement have agreed to move from rhetoric to action in implementing the trade deal. Though six African countries, including Rwanda have been chosen to pilot regional trade in selected goods, one of the major challenges is that a number of trade instruments had not been finalized.
To move from paperwork to action, the regional tripartite which met in Kigali from 10th – 11th August, 2022 recognized the role of private sectors in implementing the deal and came up with strong recommendations on how to move forward.
Trade Facilitation Programme Records Notable Progress (COMESA)
COMESA Member States, through the European Union-backed Trade Facilitation Programme have revised and adopted regulations for the elimination of non-tariff barriers (NTBs), a move which is expected to enhance intra-regional trade. The programme has equally supported Member States to implement selected measures under the WTO Trade Facilitation Agreement, development of the Regional Trade Information Portal and adoption of its standardized guidelines.
This Final Report is issued in the context of a dispute between the European Union (EU) and the Southern African Customs Union (SACU). This dispute was lodged under the Economic Partnership Agreement (EPA) between the EU and six states from the Southern African Development Community (the SADC EPA States), and relates to a bilateral safeguard measure adopted in 2018 by SACU in relation to the importation of frozen bone-in chicken cuts from the EU.
Safeguard measures may be taken if, as a result of the obligations incurred by a Party under this Agreement, including tariff concessions, a product originating in one Party is being imported into the territory of the other Party or SACU, as the case may be, in such increased quantities and under such conditions as to cause or threaten to cause: (a) serious injury to the domestic industry producing like or directly competitive products in the territory of the importing Party or SACU, as the case may be; or (b) disturbances in a sector of the economy producing like or directly competitive products, particularly where these disturbances produce major social problems, or difficulties which could bring about serious deterioration in the economic situation of the importing Party or SACU, as the case may be; or disturbances in the markets of like or directly competitive agricultural products in the territory of the importing Party or SACU, as the case may be.
Improving the CAADP BR process through critical analysis (IPPmedia)
The African heads of state and governments adopted in 2014 the Malabo Declaration that reasserts a strong commitment to reach CAADP’s goals and targets to be achieved within a ten years period (2015-2025). Dr Bahigwa Godfrey Director of Agriculture and rural development at the department of agriculture and rural development, of the African Union Commission stated that the critical analysis of the BR process aims at improve the quality of indicators that capture national information but also consider and align the new indicators that emerged from the African Common Position to the UN Food Systems Summit, but also ensure the relevance of indicators given the current economic trends. “We know that our countries committed to the comprehensive Africa Agriculture Development Programme (CAADP), during the Malabo, however, many of us have not domesticated the commitments, the recommendations from recent biennial review report indicate that we need to do more as a continent to get African agriculture where we want it to be.
China aims to surpass EU’s trade with Africa in a decade – report (The Star)
The Africa-China relationship is moving into a new phase with the latest policy initiatives, development strategies and financial pledges as tools for enhancing deeper and broader engagement by 2035. The latest report by Economist Intelligence shows China aims to push the trade from medium to long term over the next decade trying to outdo major international powers such as the US and EU. The Asian economic powerhouse is targetting sectors such as information and communications technology (ICT) infrastructure and services, agricultural ventures, consumer goods and electronics, light manufacturing and finance. To consolidate its position as the largest single country trader with the continent, it has previously pledged to buy a total of $300 billion(Sh35.9 trillion) worth of products from Africa between 2022 and 2024.
Global economy
The 3rd G20 Development Working Group Meeting Concludes, Urging The Importance Of Multilateralism And Development Funding Mechanisms (G20 Presidency of Indonesia)
The 3rd G20 Development Working Group (DWG) Meeting in Bali, held between 10 August and 12 August, concluded on Friday (12/8) with the discussion and finalization of key G20 agreements. These include the G20 Roadmap for Stronger Recovery and Resilience in Developing Countries, Least Developed Countries, and Small Island Developing States, the G20 Principles to Scale Up Blended Finance in Developing Countries, the G20 Ministerial Vision Statement: Multilateralism for Sustainable Development Goals (SDGs) Decade of Action, and the 2022 G20 Bali Update.
“The Development Working Group is a place for G20 member countries to come together, prioritize multilateralism, share solutions that promote growth, remap development plans, and achieve the SDGs targets. The G20 possesses the knowledge, expertise, and financial resources required to reverse trajectories that have gone off track. Thus, let’s make every effort to change direction ad build solid progress,” said the Minister of National Development Planning/Head of Bappenas Suharso Monoarfa.
This note reviews investor–State dispute settlement (ISDS) decisions rendered by arbitral tribunals in 2020. Thirty-one ISDS decisions on jurisdiction and merits were publicly available at the time of writing. Most claims were based on old-generation international investment agreements (IIAs) signed in the 1990s or earlier. The review of recent ISDS decisions highlights the need to speed up the reform of the old stock of IIAs currently in force. UNCTAD’s IIA Reform Accelerator, launched in November 2020, was developed to facilitate such efforts. ISDS decisions from 2020 touched upon important issues on the reform agenda for the IIA regime,
For policymakers and IIA negotiators, arbitral decisions are a useful source of knowledge on IIAs: How do IIA provisions work in practice, and which areas are most in need of reform? Together with UNCTAD’s IIA policy tools, this analysis can also help countries and regions make strategic choices concerning old-generation IIAs with ISDS. One way of addressing the challenges is to clarify key provisions through the interpretation, amendment or replacement of the old IIA. Countries may choose to pursue other available policy options (e.g. terminating an old IIA by consent or unilaterally).
Falling global food and fuel costs offer poor countries little relief (Washington Post)
Many of the global prices for food, fuel and fertilizer that spiked when Russia invaded Ukraine have returned to their prewar levels, defying the most dire forecasts even as policymakers warn of the continued risk of famine and financial crisis in the developing world. Russia’s Feb. 24 attack on Ukraine sent a shock wave through commodity markets. Since then, however, fears that the war would cut off all exports through the Black Sea have proved unfounded.
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SA negotiates settlement to clear citrus blocked in EU ports of entry (SAnews)
The South African government has managed to negotiate a settlement that will see the clearing of citrus containers stuck in ports of entry in the European Union (EU). The settlement follows new measures introduced by the EU to regulate risk associated with False Codling Moth (FCM) on citrus fruit. The new measures include amended additional phytosanitary declarations for grapefruit and soft citrus, and a revised cold treatment regime for oranges.
South Africa is in need of changes to its industrial policies (Mail & Guardian)
After 28 years of democracy, South Africa has failed to achieve structural transformation of the economy. The government must stop paying lip service to industrial policies and implement aggressive measures to transform the economy and steer production towards sectors that have high employment multipliers. Such policies can significantly increase the pace of job creation.
Metal recyclers say proposed metal export ban will negatively impact price of scrap metal (Engineering News)
Industry organisation the Metal Recyclers’ Association of South Africa (MRA) says the six-month ban on the export of metal proposed by the Department of Trade, Industry and Competition (DTIC), would detrimentally affect the price of all South African scrap metal, and, in turn, negatively impact the recycling sector and all sources of scrap generation, including manufacturing, construction and mining, as well as the informal sector. The DTIC on August 6 published draft proposals for a six-month export prohibition on scrap and waste metal, including copper cable, together with a permit system for the export of specified semi-processed metal products to address widespread theft of copper cable and other forms of metal from public infrastructure and issued a call for public comment on the proposed policies.
Manufacturing output down 3.5% y/y in June (Engineering News)
Manufacturing production in South Africa decreased by 3.5% year-on-year in June, primarily brought down by the motor vehicles, parts and accessories, and other transport equipment sector, which declined by 17% and subtracted 1.8 percentage points from the overall tally. The food and beverages sector’s 3.8% decline contributed to 0.8 of a percentage point being shaved off the overall figure, while a 2.9% decline in the manufacturing of basic iron and steel, nonferrous metal products, metal products and machinery took 0.6 of a percentage point off overall.
Zim a key market, says Nedbank Group (The Herald)
The Nedbank Group, says it continues to see Zimbabwe as a key market despite currently obtaining challenges that include resurgent inflation and operating cost pressures. The South African financial services group has a presence in the country’s financial industry through Nedbank Zimbabwe. The bank also has a footprint in other regional markets. Dr Terence Sibiya, the managing executive of Nedbank Africa Regions, during an online media briefing, said the short to medium and long-term outlook for Zimbabwe remained robust.
He said that there were various sectors of the economy that present opportunities such as infrastructure, energy, agro-processing, tobacco processing and mining. “For the long term, we believe these sectors will contribute significantly to overall recovery of the Zimbabwean economy and we would want to play a key role in that,” he said.
Kenya: Cost of flour set to shoot up as subsidy ends next week (Business Daily)
Consumers are staring at expensive flour as the subsidy programme is expected to come to an end next week. The government, in an agreement with millers, had in July agreed that the subsidy programme was to end after a month. This is despite President Uhuru Kenyatta’s announcement that the programme would continue indefinitely. The subsidy programme was started to ease the price of flour that had shot to a historic high of Sh210 on the back of a shortage of maize. The prices have so far dropped to Sh100 but the flour is hardly found in shops.
“The programme was to run for a month from the contract that we had with the government. It is coming to an end next week,” said Rajan Shah, chief executive of Capwell Industries.
Millers are also grappling with slow payment from the government even as it emerged that only Sh4 billion had been set aside for subsidy despite the Ministry of Agriculture’s announcement that Sh8 billion had been allocated for the programme.
French firms step up quest for big trade deals in Kenya (Business Daily)
French companies scouting for investment opportunities in Africa have tended to look towards the west of the continent, owing to historical ties that have similarly seen their British counterparts frequent the East African region. The European Union’s second-largest economy is, however, making a concerted effort to deepen its presence in East Africa, signified by France President Emmanuel Macron’s state visit to Kenya in March 2019 — the first ever by a French leader to Nairobi. Major French multinationals have long operated in Kenya and East Africa, particularly in the manufacturing and energy sectors.
Mourad Choiuqa, Bpifrance regional manager for Eastern, Southern Africa and the Indian Ocean, told the Business Daily that since 2015, the agency has been financing deals between French and foreign companies, from one million euros for private firms to five million for public sector players. “It’s a financial bridge that we are trying to bridge between French and foreign companies to strengthen partnerships between France and Africa. For the moment this is something that we do a lot in West Africa because of historical reasons because that’s where you find more French companies partnering with local firms,” he said.
Trade minister accused of unfair policies on rice importation (Parliament of the Republic of Uganda)
Parliament has directed the Minister of State for Trade, Hon. Harriet Ntabazi, to withdraw her directive on what they termed, ‘unfair trade policy on rice importation’. On 21 April 2022, Ntabazi issued a directive to the Commissioner, Customs Uganda Revenue Authority (URA) where she directed the Authority to stop clearing Value Added Tax (VAT) exempted rice imports at the borders. This directive prompted rice traders, specifically the Kampala Rice Traders Association to petition Parliament to intervene, claiming this directive was unfair and repugnant.
In their petition, rice traders also decried Ntabazi’s directive to install the Rice Agribusiness Development Foundation (RADFO) as an apex body with autonomous powers to import rice, which the traders said was fleecing them and frustrating trade. The matter was subsequently referred to the Parliamentary Committee on Tourism, Trade and Industry for investigation.
While presenting the committee report during the plenary sitting on Wednesday, 10 August 2022, the committee chairperson, Hon. Mwine Mpaka said that Ntabazi exceeded her powers and issued orders that have distorted trade order in the rice trade. “The minister irregularly and without lawful authority instituted RADFO as the apex body in the rice sub sector without involving the rice traders and associations. The actions of the minister are disruptive and do not encourage trade order in the rice trade,” Hon Mpaka said. The committee also noted that Ntabazi acted unfairly when she issued directives to URA to stop rice imports without giving rice traders a fair hearing.
Uganda: Proposed local content law ‘could break trade agreements’ (Supply Management)
Uganda’s government has warned MPs not to pass a private member’s bill that aims to prioritise local firms wherever possible in procurement, saying it could break trade agreements. Amos Lugoloobi, finance minister in charge of planning, asked lawmakers to closely scrutinise the local content bill, saying around 90% of its contents relate to procurement. Lugoloobi believes the bill as it stands is not likely to guarantee Ugandan firms are prioritised during public procurement and could risk sparking disputes with trading partners. The bill would force contractors using public money or Uganda’s natural resources to acquire a licence and prioritise local suppliers.
But according to Lugoloobi, the bill is not comprehensive enough to cover issues of local content and contradicts the East African Community Protocol on free movement of goods and services. “The protocol is about free movement of goods and services and you cannot legislate against it,” he told a finance committee. He urged consultations with the minister for East African community affairs instead.
US Think Tank: Morocco Positions Itself As Africa’s ‘Business Hub’ (Morocco World News)
Given its gigantic infrastructure projects and well-defined strategy, Morocco is positioning itself as a “business hub” in Africa, according to a recent article by the Global Policy Institute, a Washington-based US think tank.
“Morocco enjoys political stability, a geographically strategic location, and robust infrastructure, which have contributed to its emergence as a regional manufacturing and export base for international companies,” the article noted.
Titled “Morocco’s Road to Development,” the think tank’s report highlighted Morocco’s commitment to further improve the business climate and attract more foreign direct investment, while reinforcing its investment strategy in sub-Saharan African countries.
African trade and integration
The AfCFTA Country Business Index: Understanding private sector involvement in the AfCFTA (Brookings Institution)
The narrative around a successful African Continental Free Trade Area (AfCFTA)—its potential to increase intra-African trade by 15 to 25 percent, or $50 billion to $70 billion—is promising, but if African businesses do not efficiently utilize this landmark agreement, its ultimate success will be limited. Since the private sector is directly involved in cross-border trade, it is a major stakeholder and beneficiary of the AfCFTA.
Thus, to better understand how African businesses are approaching the AfCFTA and, more importantly, how the AfCFTA can best support those businesses through trade, the United Nations Economic Commission for Africa (ECA) created the AfCFTA Country Business Index (ACBI).
The ACBI is a new AfCFTA-focused, ease-of-doing business index and is based on a robust theoretical framework and data collection process. It enables relevant policymakers to identify bottlenecks in intra-African trade at a country level, which informs the barriers impeding effective AfCFTA implementation from the perspective of the private sector. It aims to inform African policymakers on the trade barriers and guide AfCFTA national strategies. The ACBI aims to ensure that the African Continental Free Trade Area delivers on its projected sustainable development promises, especially for women-owned and small- and medium-sized businesses (SMEs).
AfCFTA launches digital hub to ease trade on the continent (Capital Business)
The African Continental Free Trade Area (AfCFTA) Secretariat has launched a digital platform aimed at easing trade on the African continent. The platform dubbed – The AfCFTA Hub – is an interconnect clearing house for national government, intergovernmental, private, and public digital and partnership platforms to link together all businesses to drive the success of the free trade area. The hub is designed to grow into a single, trusted directory of the services needed to navigate the AfCFTA for small players, thereby making the AfCFTA the most inclusive Free Trade Area in the world.
Kenya is one of the seven countries that have been selected to start trading under the AfCFTA framework in a pilot phase to test the environmental, legal and trade policy basis for intra-African trade. Following the selection, the country recently launched its National AfCFTA implementation strategy to fast track implementation of the AfCFTA. The Strategy identifies priority export products and sectors for goods and services aligned with Kenya’s national development goals and aspirations, including the Integrated National Export Development and Promotion Strategy (INEDPS) and the Big Four Agenda.
AfCFTA: Homework, Hard Work, Network And Smart Work Key Factors To Successful Business – Amb. Samuel Owusu (Peace FM Online)
The UN Eminent Peace Ambassador to Ghana, Dr Samuel Ben Owusu has stated that it will take four key factors, Homework, hard work, network and smart work to run a successful business in the country.He made the assertions at the Mantse Amugi Business Africa 2022 Conference which was held at the Accra Metropolitan Assembly (AMA) on the 9th to 10th of August 2022.The Conference and Exhibition dubbed, “Realizing the AfCFTA Benefits and More” was organised under the auspices of the Ga Traditional Council in Partnership with the Office of the Ga Mantse and JLA Group International.
“Do as much homework as possible. Deeply understanding the potential customer’s pains and desires allows a founder to iterate the product and vision to quickly find product/market fit. Really knowing the market allows a team to be flexible in their plans and to identify and analyse new opportunities as they arise. It also strengthens your confidence, your self-esteem and integrity in your industry.”He also said,” You must align yourself with a certain character and attitude to effectuate your homework studies, you must have the attitude of quick response, responding to inquiries and the market demands will keep you ahead if the market obedience to the fluctuation of the market and being obedient to your task.”
Agro-processors urged to tap into continental trade platform (The New Times)
“Over 4,000 local cooperatives are in agricultural business, small firm industries are agro-processing based, it shows how agriculture plays a major impact in trade and if we upsurge on the agro- processing industries, the county will be able to tap all the prospects in free trade area, but only if we have competitive products on the market”, he said The Minister of Trade and Industry, Jean-Chrysostome Ngabitsinze has urged local agro-process manufactures to tap into opportunities offered under the African Continental Free Trade Area (AfCFTA).
Adopt Malabo declaration, African governments told (IPPmedia)
It was revealed at the workshop on Critical Analysis on the Biennial Review Process held recently in Yaounde, Cameroon that failure and hesitation in adopting the pledge to align by the Malabo declaration is accelerating the current food security crisis across the continent.
Speaking on reasons behind the declaration implementation failure in most of the continent’s states, Minister of Agriculture and Rural Development Republic of Cameroon Mbairobe Gabriel said African countries should domesticate the 2014 Malabo commitments if the continent is to benefit from its agricultural potential and develop holistically.
We know that our countries committed to the comprehensive Africa Agriculture Development Programme (CAADP)during Malabo, however, many of us have not domesticated the commitments,” he said.
According to him, the recent biennial review indicates that African countries need to do more as a continent to get the African agriculture system where it is supposed to be. He urged Africans to quickly rethink and act accordingly.
Museveni pledges to back Somalia’s bid to join EAC (Monitor)
President Museveni has pledged to support Somalia in its bid to join the East African Community (EAC) and exploit trade opportunities that exist in the region. Mr Museveni said Somalia has all qualifications to join EAC, which include; sharing a border with one of the member countries, having a private sector-led economy and being a democratic country. He was speaking during the closing ceremony of a two-day inaugural Uganda-Somalia business and investment summit held in Kampala yesterday.
ECA currently comprises Uganda, Kenya, Tanzania, Rwanda, Burundi, South Sudan and DR Congo. Mr Abdirashid Duale , the chief executive officer of Dahabshiil, a money transfer company, said the summit does not only present opportunities but also helps the business community understand the challenges that people in the region face.
Sustainable Market Access for African Road Transport (Smart) - Final Report (AfDB)
The Final Report of the SMART (Sustainable Market Access for African Road Transport) study is aimed at analysing the main regulatory and non-physical barriers that impede a streamlined movement of vehicles and goods within and between the different Regional Economic Communities (RECs) in Africa, and at providing recommendations in order to increase efficiency of cross-border road transport, reduce its costs, and maximize the economic benefits of the transport infrastructure, in view of reducing the cost of trad-ing across borders.
15 Sub-Saharan African countries that earn the highest forex through exports of products and services (Business Insider Africa)
For most developing countries in Africa, foreign trade is imperative. For one, these countries need to import the many products and services they can’t produce. Also, exporting their products (mostly raw materials) gives them the opportunity to earn much-needed hard currency and bolster their foreign reserves.
For the rest of this article, we shall focus on fifteen African countries that earn the highest foreign exchange through exports of products and services. This is particularly important now that many African countries, from Nigeria to Kenya, are grappling with chronic dollar shortages. Perhaps the answer to the problem is for these countries to find ways to export more products and services so they can earn more forex.
Pascal Lamy: Africa’s position at Cop27 (African Business)
Few people understand issues of international trade, development and environment as well as Pascal Lamy. Following eight years as director-general of the World Trade Organisation, Lamy now serves on the board of the Mo Ibrahim Foundation, one of Africa’s most influential civil society organisations. He joins us following the release of the Foundation’s 2022 Governance Forum report, which aims to make Africa’s case in the global climate change debate ahead of Cop27 in Egypt in November.
Framing it as a race between demography and economy, Lamy wants to see Africa’s development needs prioritised in the global response to climate change. Africa is prepared to fight for its position, he says, and highlights South-South solidarity as a countervailing force against the US, China, EU and other heavyweights.
Africa is already a large positive for the global climate ledger, and Pascal outlines further opportunities for the continent to support global climate solutions. Governance will be key, he says, explaining the Mo Ibrahim Foundation’s work on governance monitoring, assessment and improvement.
The New U.S. Africa Strategy Breaks From the Status Quo—With Some Perplexing Stumbles (Carnegie Endowment for International Peace)
On Monday, U.S. Secretary of State Antony Blinken introduced the Biden administration’s much-awaited strategy for Africa. Speaking in South Africa, during his second trip to the continent in less than a year, Blinken outlined the policy against a backdrop of the pandemic, the war in Ukraine, and a global economic slowdown. Although somewhat comparable to recently launched initiatives for Latin America and the Indo-Pacific, the Africa strategy stands out as an uniquely elaborate effort at a moment when the administration is working to revamp U.S. relations across the globe.
At its core, the strategy articulates a vision for a twenty-first century U.S.-African partnership motivated by discernible global shifts. One motivation is the realization of Africa’s importance to U.S. global priorities, such as the continent’s rapidly growing population, one of the world’s largest trading blocs, significant natural resources endowments, and a sizable voting bloc in the United Nations.
U.S.-Africa partnerships advance shared ideals (ShareAmerica)
Exclusive: Singapore’s Thunes and Standard Bank in advanced talks to extend African payments (The Africa Report)
The planned partnership will help Thunes to expand its presence in some of the 35 sub-Saharan countries where it operates, as well as add new markets, Yao says from the company’s regional head office in Nairobi. Thunes aims to add 13 new sub-Saharan countries by the end of 2023 and has identified Angola and Namibia as priority new markets for entry, Yao says.
Remittances can be made instantly from international Thunes partners to African countries such as Kenya, Ghana and Tanzania which have a “real-time switch” for bank transfers. Africa lags behind the rest of the world in terms of real-time remittances. Last year, according to ACI Worldwide, 20 African states remained absent from any kind of real-time payments system.
The first Africa-Caribbean Trade and Investment Forum Comes On 1-3 September at Barbados (Modern Diplomacy)
The Government of the Republic of Barbados will be hosting the first ever edition of the AfriCaribbean Trade and Investment Forum (ACTIF) which is being convened by African Export-Import Bank (Afreximbank) and Government of Barbados in collaboration with African Union Commission (AUC), African Continental Free Trade Area (AfCFTA) Secretariat, Africa Business Council, the Caribbean Community Secretariat, and Caribbean Export Development Agency.
The main goal of the AfriCaribbean Trade and Investment Forum is to provide a platform for the development of strategic partnerships between the business communities in Africa and the CARICOM Region with the objective of fostering bilateral cooperation and engagement in trade, investment, technology transfer, innovation, tourism, culture and other services. The Forum will also be used as a vehicle to actively promote trade and investment opportunities among people of Africa and the Caribbean, as well as the wider diaspora which will contribute to the implementation of the African Continental Free Trade Agreement (AfCFTA) and to the Caribbean trade development agenda.
Global economy
Building resilient maritime logistics in challenging times (UNCTAD)
Frequent disruptions in supply chains have exposed the vulnerability of transport and logistics operations amid unequal capabilities and resources between countries. Recurrent extreme weather events, the COVID-19 pandemic, the war in Ukraine and other crises illustrate the magnitude of the challenge and its implications for global supply chains and sustainable development. These challenges underscore the need to enhance resilience, particularly in the most vulnerable economies. “As disruptions are becoming part of the new normal, resilience and risk management emerge as new mantras for transport, logistics, trade and supply chains,” said Shamika N. Sirimanne, director of UNCTAD’s technology and logistics division.
To help countries cope with the new normal, UNCTAD has launched a new website to promote resilient maritime logistics in the face of disruptions. The website includes a guidebook for ports entitled “Building Capacity to Manage Risks and Enhance Resilience” and a wealth of other resources. “The web package provides our beneficiaries with support in risk identification, assessment, management tools and approaches, case studies, good practices and a step-by-step resilience-building process for ports and other relevant maritime supply chain actors,” she added.
“There is no time to waste”: Commonwealth Secretary-General calls for greater, multidisciplinary collaboration to enhance food security (The Commonwealth)
The Commonwealth Secretary-General has called for a holistic and multi-disciplinary approach to tackle the increasing threat of food insecurity across the world, which has been exacerbated by the COVID-19 pandemic, conflict, the climate crisis, and political, social and economic inequalities. Speaking at an event held in the margins of the Birmingham 2022 Commonwealth Games on 29 July 2022, the Secretary-General committed to making food security a primary focus, urging the international community to step forward with practical and financial support for countries facing famine and people facing starvation. The UK House panel discussion saw Commonwealth leaders, policymakers, and academics discuss how university-led partnerships are key to translating research and expertise into action on the pressing global challenge of food security, biodiversity loss and climate action.
In her keynote address, the Commonwealth Secretary-General, The Rt Hon Patricia Scotland QC, highlighted the critical need for international experts, academics, and policymakers to work together, across sectors and disciplines, to develop practical solutions to issues such as climate change and food security, and support sustainable growth across the Commonwealth.
Young workers have been hit hardest by COVID fallout, says UN labour agency (UN News)
According to the International Labour Organization (ILO), the pandemic has caused many additional problems for 15 to 24-year-olds who’ve experienced “much higher” unemployment losses than older workers since the global health emergency was declared in early 2020. Young women have struggled more than their male counterparts to find work, while Arab nations are expected to see the highest levels of youth unemployment by the end of the year, compared to the global average. “We know that the COVID-19 pandemic has wreaked havoc on youth labour markets around the world,” said Martha Newton, ILO Deputy Director-General for Policy. “It’s exposed a number of shortcomings in the way the needs of young people are addressed, especially the most vulnerable first-time job seekers, school dropouts, fresh graduates with little experience and those who remain inactive not by choice.”
Speaking at the launch of ILO’s report, Global Employment Trends for Youth 2022: Investing in transforming futures for young people, Ms. Newton said that the share of youth not in employment, education or training in 2020 rose to 23.3 per cent.
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Citrus fruits are one of the most important export products for the South African economy. The South African Citrus Growers Association (CGA) estimates that the country exported 158.7 million cartons of oranges in 2021, making it the biggest revenue earner in Africa from orange exports. The European Union (EU) is one of the main destination markets for South African citrus fruits, making up 40% of South African orange exports and 27% of its soft citrus exports.
On 21 June 2022, the EU published a new cold treatment regulation for the importation of the fruits of Citrus sinensis Pers. (oranges/sweet oranges) from South Africa and various other countries, based on its right to protect it territory from a phytosanitary pest commonly known as false codling moth (FCM). The Regulation entered into force on 24 June 2022, and it applies as from 14 July 2022.
The initial reaction of the CGA was to point out that there was a need for such measures to be necessary, justified, proportionate and feasible. On 28 July 2022, however, the South African Department of Trade, Industry and Competition (DTIC) confirmed that the South African government had submitted a Request for Consultations with the EU in terms of the WTO Understanding on Rules and Procedures Governing the Settlement of Disputes (DSU). Read more.
EU’s New Import Rules Cost South African Citrus Exporters $12 Million (Bloomberg)
South Africa strikes deal with EU to release tons of oranges stuck at harbours (Engineering News)
Feathers set to fly as union Fawu calls for poultry meeting with Patel (IOL)
The Food and Allied Workers Union (Fawu) yesterday slated the decision by Trade, Industry and Competition Minister Ebrahim Patel to suspend to suspend poultry anti-dumping duties for 12 months, saying this would kill jobs and sector. It also called for an urgent meeting with the minister.
The department of trade, industry and competition (DTIC) on Monday granted a reprieve to Brazil, Denmark, Ireland, Poland and Spain by suspending the implementation of anti-dumping duties against them. It did so to grant relief to South African consumers who are battling with the high cost of living including soaring food prices.
Local poultry producers this week threatened to hold back investment in the sector for the duration of the withholding of tariffs.
Namibia trade deficit drops to N$2,5 billion (The Namibian)
Namibia’s export earnings in June 2022 stood at N$8 billion, up 26% on May figures, while the import bill amounted to N$10,5 billion - down by 15,9%.According to the Namibia Statistics Agency’s Namibia Trade Statistics Bulletin for June, this resulted in a trade deficit of N$2,5 billion, which is 59,4% lower than the N$6,1 billion recorded in May 2022. Namibia’s trade composition by partner showed that Botswana emerged as Namibia’s largest market for exports, whereas South Africa maintained her position as the largest source market for the country. The composition of the export basket for the month under review mainly comprised minerals such as precious stones (diamonds) and uranium, while fish remained the only non-mineral commodity in the top five products exported.
“Namibia’s cumulative trade activities continued to increase for the period of January to June 2022 when compared to the same period during 2021,” said the bulletin, signed by statistician general Alex Shimuafeni.
Brazil business engagement promotes Namibia as the preferred and shortest trade route into southern Africa (Namibia Economist)
The Walvis Bay Corridor Group (WBCG) embarked on a business development mission to Brazil in July as part of its ongoing efforts to promote Namibia as the preferred and shortest trade route into southern Africa. The mission’s goal was to engage the Brazilian business community, ports, shipping lines, freight forwarders, and industries to explore opportunities Namibia can provide as a supply chain solution for the Brazilian market, Namports Quayside bulletin released this week said. According to the bulletin, the two-week engagements concluded successfully with an information-sharing session in São Paulo, Brazil. The session, titled “Positioning Walvis Bay as Brazil’s Preferred Trade Route,’ highlighted the advantages of using the Ports of Walvis Bay and Lüderitz and thus by extension the Walvis Bay Corridors.
“The promotion of trade, investment, and economic cooperation should continue to be given higher emphasis in this situation. Stronger cooperation in other areas of our economies should be encouraged by the positive bilateral and diplomatic relations between our two nations. Furthermore, I want to reassure you that our two nations have already signed several general framework agreements for cooperation in a variety of fields. These agreements should function as a catalyst for our two nations’ sectors to finalize their sector-specific agreements and memoranda of understanding, further enhancing and elevating the level of cooperation between Brazil and Namibia to greater heights,” said Mbapeua Muvangua, Namibia’s Ambassador to Brazil.
Changes in sub-Saharan maize trade spell potential trouble for Kenya (CNBCAfrica)
Maize production in some of the sub-Saharan African countries that dominated maize supplies during the 2021/22 marketing year is expected to be lower this coming season. This will bring about some changes in the sub continent’s maize trade in the 2022/23 marketing year, in particular creating complications for Kenya. In the 2021/22 season, Kenya was the largest maize importer in the region. But Kenya has a longstanding policy against genetically engineered maize. This limits the role of South Africa, the sub-continent’s biggest maize producer and exporter, in meeting Kenya’s needs. The expected lower production comes in a season when demand for maize from countries in sub-Saharan Africa that rely heavily on imports is expected to remain strong. It’s estimated that Kenya, for example, will need to import 700,000 tonnes of maize for 2022/23. Kenya’s maize production is expected to be marginally higher, but not enough to meet the country’s needs.
Kenya is typically one of the major maize importing countries in sub-Saharan Africa. The country’s expected 700,000 tonnes of maize imports account for 21% of the region’s expected maize imports of 3.4 million tonnes in 2021/22 season, according to data from the International Grains Council. Other typical maize importing countries include Zimbabwe, Botswana, Mozambique and Namibia. However, in the 2021/22 marketing year, several sub-Saharan African countries such as Zambia, Tanzania, Zimbabwe (an exceptional year from the usual importing position) and South Africa had ample maize harvest. This made it easy for them to meet Kenya’s import needs. Tanzania and Zambia were the leading maize suppliers to Kenya.
China Exempts Rwanda From Export Taxes (Taarifa News)
China will start its zero-tariff to 98% of products from 16 developing countries including Rwanda effective next month, according to China’s Department of Foreign Affairs. Officials say the move is aimed at increasing the number of imports from low developed countries including those in Africa and some Asian countries as well as cementing strong trade ties in future. Wu Deng, China’s Director General, Department of African Affairs, MFA, China said in a Tweet that; “From September 1, (sic), China will increase the scope of products enjoying zero-tariff treatment to 98% for 16 least developed countries including Rwanda, Djibouti and Togo” His tweet added; “The tax free policy will gradually expand to all least developed countries and increase imports from Africa.”
Burundi allows sugar, cement imports to tame black market (The East African)
Burundi is set to open a window for importing sugar and cement to meet a shortfall that has created a black market where prices have shot up. This was revealed through a Cabinet statement released Wednesday following a Council of Ministers meeting in Gitega last week. “There are discrepancies between the reference prices and the actual prices on the market,” the Cabinet said, adding that efforts to enforce official prices have been in vain. State-owned producers have also been seeking a price review, particularly beer maker Brarudi and cement manufacturer Buceco since 2021, for reasons including soaring raw materials and transport costs. “Given the production capacities of these companies, it is not clear that these products will be available even after the price increase,” the Cabinet noted.
Parliament passes One Stop Border Bill (Malawi24)
Members of Parliament on Tuesday passed One Stop Border Bill which seeks to provide a legal framework for implementation of agreements signed between the Republic of Malawi and neighboring countries for operationalization of one stop border posts to facilitate coordinated border control for efficient cross-border movement of people and clearance of good. The legislation will enable Malawi to comply with its obligation under the SADC Protocol on Trade, COMESA Treaty and other regional and international trade facilitation agreements. One-stop borders reduce the number of stops in cross-border trade and other transactions by combining and locating, at a single location, border and control activities between the Republic of Malawi and neighboring countries. Phiri added that the bill aims at streamlining operations of all borders so that clearing of goods and people who are traveling to neighboring countries should be sped up.
tralac Blog: Extended border delays a common experience at Kasumbalesa: What are the real issues and can we expect improvements?
African trade and integration
Trial sale of commodities through AfCFTA begins (The East African)
Tanzania, Kenya and Rwanda will trial sale livestock, fruits, vegetables and spices in a pilot phase of the Africa Continental Free Trade Area agreement (AfCFTA) and whose findings will be tabled at the AU Summit next year. The regions’ team leader in the AfCFTA negotiations Damas Haule says the countries’ offer also includes fish, medicines, fertiliser, paper and industrial chemicals. Energy products such as cooking gas, bicycle and motorcycle tyres, and machinery for construction and farming have also been included. The three countries were selected in June to start trading under the pilot phase whose final details will be thrashed out before a formal roll-out in the final quarter of this year.
Case Made For Slow Start To Trading Under AfCFTA (News Ghana)
More than a year since the symbolic export under AfCFTA by two of Ghana’s manufacturing companies, no other companies have exported under the continental free trade agreement, with sections of the public questioning why. The Secretary General of the International Chamber of Commerce, Ghana, Emmanuel Doni-Kwame has explained that this is neither a demonstration of a failure of the trade agreement nor a sign of low interest by the private sector. According to the Secretary General of ICC Ghana, intra-Africa trade persists however many traders may be trading under existing different trading agreements such as the ECOWAS Trade Liberalization Scheme (ETLS) and are yet to migrate unto AfCFTA.
Mr. Doni-Kwame also opined that private sector’s lack of activeness in the free market may be as a result of negotiations still ongoing between the party states. He added that, while Ghana may appear ready to trade that may not be the case for all other countries who are at different levels of readiness.
Papss can save continent $5b in payment costs (The East African)
Pan-African Payment and Settlement System (Papss), is a payment method that operates across African borders allowing the transfer of currencies instantly and at low costs. Its chief executive spoke to Bamuturaki Musinguzi about its achievements and prospects.
Over 80 percent of intra-African payments go through Europe or the US, resulting in high transfer and compliance costs. The establishment of the African Continental Free Trade Area (AfCFTA) has added to the need and urgency of providing an enabling continental payment and settlement infrastructure that will support its objectives. Papss was adopted in July 2019 by the African Union Heads of State to support the AfCFTA.
All six central banks of WAMZ (West African Monetary Zone) have been carrying out a pilot live exercise, which began in October 2021, and has been successfully concluded. This paves the way for commercial bank transactions. In the past few months, two more central banks and more than 300 major commercial banks have joined the PAPSS network.
In parallel, we signed strategic partnerships that broaden our reach — such as the Comesa Regional Payment and Settlement System.
PAPSS is now ISO 27001 Certified, in commitment to global security standards (Afreximbank)
The Pan-African Payment and Settlement System (PAPSS) operated by African Export-Import Bank (Afreximbank) in collaboration with the African Continental Free Trade Area (AfCFTA) Secretariat and the African Union (AU), announced today that it has achieved the International Organisation for Standardisation (ISO) 27001 certification for its global operations. Following an external certification audit, by an accredited certification body that was conducted on the 27th of June 2022, PAPSS was recognized as compliant to ISO27001:2013 standard.
Mike Ogbalu III, CEO of PAPSS said: “PAPSS being a Pan-African Payment Market Infrastructure, with its mandate to provide an interoperable, secure and low-cost cross-border payment infrastructure. The main enabler to achieve the above mandate is to build the highest levels of trust assurance with our stakeholders. In addition to that, through the continual improvement approach, this achievement will help in improving PAPSS operational efficiency and compliance with global standards ensuring the protection of company image and reputation.”
SADC Business Council and Afreximbank launch the SADC – Africa Trade and Investment Marketplace (Afreximbank)
The Export-Import Bank (Afreximbank) and the SADC Business Council (SADC BC) have launched the SADC – Africa Trade and Investment Marketplace which aims to promote regional trade, unlock investment opportunities, deepen economic cooperation, and drive sustainable business growth between the SADC region and the rest of Africa. The SADC – Africa Trade and Investment Marketplace will provide the private sector in the SADC region with a platform to foster higher levels of engagement in trade and investment-related matters with the rest of Africa. Afreximbank will provide access to trade and market information through its trade and investment programmes – roadshows, investment conferences, the biennial Intra-African Trade Fair (the next edition being slated for 21-27 November 2023 in Abidjan, Cote d’Ivoire) – as well as digital platforms such as the Trade Information Portal, Trade Regulatory Information Portal and the African Trade Exchange among others, to enable the private sector in SADC to connect with the rest of Africa. Further, Afreximbank will deploy a range of its financing instruments and trade facilitation initiatives to advance intra-African trade and investment under the African Continental Free Trade Agreement (AfCFTA).
Somalia Bids to Join EAC, Museveni Vows to Support It (Chimpreports)
Somalia is bidding to join the East African Community (EAC), and the newly elected Somali President Hassan Sheikh Mohamud is persuading EAC leaders to accept his country’s application.
Speaking at the inaugural Uganda-Somalia Investment and Business Summit at Munyonyo Commonwealth Resort in Kampala on Wednesday, President Mohamud said that Somalia belongs to East Africa, and therefore its application to join the Bloc should not be rejected. In response, Ugandan President, Yoweri Museveni pledged his full support for Somalia to join the East African region Bloc.
Why East African’s financial sector linkage could be stillborn (The East African)
A plan to harmonise the financial sector in the region risks stalling as East Africa’s partner states grapple with economic and political crises. These problems have seen the World Bank-funded stockmarket reforms fall behind schedule by more than six years. The World Bank has been funding the region’s stock market linkage project through a $26.5 million grant. But it now says partner states face financial constraints and could not sustain the operations of an interlinked stock market. The Bank says in its Implementation Completion Report that some partner states are even finding it difficult to finance the implementation of the financial education strategy/financial literacy within their respective countries. “Inadequate budgets remain an important constraint to pursuing the financial integration agenda of the community forward, including the goal of achieving a single market in financial services and implementation of the Monetary Union Protocol,” the bank says, referring to the EAC’s third pillar of integration.
Small-Scale Cross-Border Trade Initiative Extended by 31 Months (COMESA)
The European Union (EU) has granted a no-cost extension to the Small-Scale Cross Border Trade Initiative (SSCBTI) programme by 31 Months. The Project will now end in December 2024 from the initial deadline of May 2022. Assistant Secretary General for Administration and Finance Dr Dev Haman revealed this in Lusaka during the opening of the third Meeting of the Project Steering Committee for the SSCBTI on 8 August 2022. The programme has had four years of implementation and has made good progress with tangible successes in working to formalize small-scale cross border trade flows in the COMESA-EAC-SADC tripartite region. Therefore, this extension will allow for implementation of the remaining activities that are pending.
Rwanda Reaffirms its support of COMESA (COMESA)
Rwanda has reaffirmed its support of regional integration programmes being implemented by the Common Market for Eastern and Southern Africa (COMESA). His Excellency Paul Kagame says his government believes that integrating African countries is a sure way of attaining economic prosperity and development. He said this at State House in Kigali on 2nd August when he met Secretary General Chileshe Mpundu Kapwepwe who was leading a COMESA delegation on a three-day working visit to that country. The President used the occasion to commend COMESA on making positive advancements in enhancing intra-regional trade by developing various trade facilitation Instruments that are being used by the people.
In highlighting the importance of regional programmes, President Kagame reiterated his governments’ willingness to host the next Tripartite Free Trade Area (TFTA) Summit. The last Tripartite FTA Summit was held in June 2015, in Sharm El Sheikh, Egypt when the TFTA was launched.
Central African Economy Ministers Meet to Merge Regional Economic Groupings (VOA News)
Central African ministers meeting in Cameroon have agreed to merge two regional blocs in a move to boost trade and growth. The 11-member Economic Community of Central African States (ECCAS) will join with the six-member Economic and Monetary Community of Central Africa (CEMAC). The deal aims to eliminate rivalry that has helped to make central Africa the poorest region among Africa’s economic groups.
Central African economy ministers say they want to foster regional integration, accelerate economic transformation and facilitate development by merging the two economic blocs.
‘Sobering’ African Economic Outlook strikes a chord with US and UK stakeholders (AfDB)
The African Development Bank’s African Economic Outlook report 2022 (AEO) struck a chord with policymakers and other stakeholders during recent seminars in the United States and the United Kingdom. An African Development Bank Group delegation, led by Acting Chief Economist and Vice President Kevin Urama, was in Washington D.C. 20-29 July, and London 1-2 August, to discuss the AEO, a flagship publication of the Bank, with global market players.
The verdict was clear. From the International Monetary Fund to the World Bank, the Centre for Global Development, Brookings Institution, the Atlantic Council, and the University College London this week, speakers agreed that the 2022 AEO provides evidence-based policy options for driving inclusive growth by building climate resilience and a just energy transition in Africa.
Yacob Mulugetta, professor of energy and development policy at the University College London, observed that the AEO captures how low-carbon transitions in Africa will vary from country to country. “What this means is transformational socio-economic opportunities must be at the forefront of the green energy transition. This will require new technologies as well as climate finance…which is additional finance beyond official development assistance,” Mulugetta said at a public seminar for policy stakeholders in the UK on Monday.
A recent webinar hosted by the African Development Bank brought together experts to examine how Africa can become a hub for manufacturing lithium-ion batteries to store energy and electrify the transport fleet. The webinar, which was held on 11th July 2022 under the theme, Leveraging Africa’s green minerals for the energy transition: The role of regional integration and the AfCFTA, is part of a knowledge series organized by the Bank’s African Natural Resources Management and Investment Centre, and the Energy Financial Solutions, Policy Regulations Department.
Dr. Vanessa Ushie, Acting Director of the Bank’s African Natural Resource Management and Investment Centre, emphasised Africa’s potential in her opening remarks: “Given Africa’s competitive advantage due to rich endowments in renewable energy and green mineral resources, many African countries have a unique opportunity to benefit from low-carbon development and a just energy transition pathway appropriate to their national context.”
Following EU’s Dangerous Fossil Gas Push Will Put Africa In Danger: AU (Business Hallmark)
A technical committee of the African Union has sounded warning on the dangerous push for gas supply by the European Union, a situation climate activists say has capacity to put the continent in danger of locking Africa into fossil fuels for decades to come. In the midst of this , African leaders are said to be contemplating a new position that would prioritize natural gas and nuclear over cleaner, cheaper, renewables. Recall the technical committee of the African Union – made up of energy ministers had earlier forwarded an “African Common Position on Energy Access and Transition”. This position reflects essentially fossil gas and nuclear energy, at the expense of renewables, and is proposed for adoption by African Heads of State and was launched at COP27.This development is surfacing on the crest of the European Union’s recent vote in favour of a new rule that will consider fossil gas and nuclear projects “green,” making them eligible for low-cost loans and subsidies, and their scramble for Africa’s energy resources.
Time To Advance with Africa: Seizing Opportunities with A Vital Continent (US Chamber of Commerce and Industry)
Over the course of this year, the U.S. Chamber is elevating its longstanding policy engagement with the continent to capitalize on Africa’s shifts in business, technology, and domestic and global partnerships to seize opportunities with a critical partner on the verge of a major socioeconomic revolution. At each stop around the country, the roadshow will convene public- and private-sector leaders from the government and business community, in partnership with our local network of Chambers, for discussions, engagements, and panels explaining the opportunities for business to expand Africa’s commercial profile domestically, increase U.S. exports and investment, highlight tools to support new market entrants, and grow commercial opportunities.
How America Can Foster an African Boom (Foreign Affairs)
TICAD 8 offers Japan chance to rebuild influence in Africa (African Business)
Japan’s relations with the African continent are again in the spotlight as the eighth Tokyo International Conference on African Development (TICAD 8) in Tunisia nears. In the past, Tokyo largely exercised its influence on the continent through soft power and aid and development, while the private sector and commercial lenders have been more cautious. Yet Tokyo is hoping to give its private sector renewed impetus to invest in Africa and lend to the continent as economic engagement by its great geopolitical rival China drops off at the same time as the twin impacts of Covid-19 and the war in Ukraine hit the global economy.
The number of global powers seeking to play a substantial role in Africa’s political, diplomatic and economic life has steadily increased since the end of the Cold War. Until now, Japan’s role has been overshadowed by China, which has been the biggest source of bilateral project finance since the turn of the millennium, boosted by the provision of cheap loans for projects developed by Chinese contractors to keep them occupied at times of lower domestic demand.
India woos Africa with trade, tech and investment | DW | 10.08.2022 (DW)
Over 40 high-level ministers and dozens of businesspeople from various African countries visited India in July to attend a key investment meet aimed at boosting commercial relations between the two sides. Addressing the two-day gathering, attended by ministers from countries such as Cameroon, Burkina Faso, Eswatini, Ethiopia, Sudan and Nigeria, India’s Foreign Minister Subrahmanyam Jaishankar highlighted that India’s bilateral trade with Africa “reached $89.5 billion (€86.45 billion) in 2021-2022 compared with $56 billion the previous year.” India’s main exports to Africa are refined petroleum products and pharmaceuticals while Africa primarily exports crude oil, gold, coal and other minerals.
The South Asian nation’s Commerce and Industry Minister Piyush Goyal, meanwhile, stressed New Delhi’s intent to reach a trade pact with Africa. This is because the economic outlook, in the long run, “is going to be promising for both India and Africa, because this is where the markets and opportunities are present,” he said at the conclave.
Global economy
Ukraine grain export deal off to ‘a very good start’ – UN interim Coordinator (UN News)
Frederick J. Kenney Jr., interim Coordinator for the UN at the Joint Coordination Centre for the Black Sea Initiative, said at a regular UN press briefing via video link from Istanbul, Türkiye that the ships contain “over 370,000 metric tons of grain and other food stocks”. “Those vessels had been stranded in the three ports covered by the initiative when the war started”.
The initiative specifically allows for significant volumes of commercial food exports from three key Ukrainian ports in the Black Sea – Odessa, Chernomorsk and Yuzhny. During the agreement signing ceremony in Istanbul, Türkiye, on 22 July, Secretary-General António Guterres called the initiative “a beacon of hope” in a world that desperately needs it. He also announced the establishment of the Joint Coordination Centre to monitor implementation that would be hosted in Istanbul and include representatives from Ukraine, Russia and Türkiye.
UNCTAD spells out actions to curb cryptocurrencies in developing countries (UNCTAD)
Global use of cryptocurrencies has increased exponentially during the COVID-19 pandemic, including in developing countries. UNCTAD has released three policy briefs that delve into these risks and costs, including the threats cryptocurrencies bring to financial stability, domestic resource mobilization and the security of monetary systems.
While these private digital currencies have rewarded some, and facilitate remittances, they are an unstable financial asset that can also bring social risks and costs.
The policy brief entitled “All that glitters is not gold: The high cost of leaving cryptocurrencies unregulated” examines the reasons for the rapid uptake of cryptocurrencies in developing countries, including facilitation of remittances and as a hedge against currency and inflation risks. Recent digital currency shocks in the market suggest that there are private risks to holding crypto, but if the central bank steps in to protect financial stability, then the problem becomes a public one.
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Local news
Government Publishes Policy Proposals on Measures to Address Scrap Metal Theft (the dtic)
Government today published draft proposals to address widespread theft of copper cable and other forms of metal from public infrastructure that has crippled power supplies, left trains unable to operate and damaged public facilities in many parts of the country. The proposals have been developed following consultations by the Departments of Trade, Industry and Competition (the dtic), Police, National Treasury, Mineral Resources and Energy, Public Enterprises (including state owned enterprises), and Transport and was published in the Government Gazette today by Minister Ebrahim Patel.
The draft measures propose a six-month export prohibition on scrap and waste metal, including copper cable, together with a permit system for export of specified semi-processed metal products. This is the first of three envisaged phases, with further actions proposed in future that include a new, enhanced registration system for scrap buyers and sellers to improve monitoring, policing and law-enforcement, limitations on the ports and (potentially) border posts to be used for trade in scrap metal, and changes to the legislation to make it more difficult for stolen copper and metal to be traded.
“A disaster”: South African citrus fruit trapped in European ports (Fresh Fruit Portal)
After South Africa filed a complaint with the World Trade Organization (WTO) last month when the EU introduced new phytosanitary requirements, the trade dispute between the two parties continues. The measures came into force in July when ships carrying hundreds of containers full of South African fruit bound for Europe were already at sea and now, tonnes of oranges are rotting in containers stuck in European ports and could be wasted, according to a report by Euro news.
The new rules, which came at the height of the orange season, caught producers off guard. Some 3.2 million cartons of citrus fruit worth about €35 million were left with papers that were invalid on arrival.
In its WTO complaint, South Africa argues that the EU’s requirements are “not based on science”, “discriminatory” and excessive. Moreover, “it will add costs. And right now, that’s what no producer in the world can afford,” added Hannes de Waal, who runs the almost century-old Sundays River Citrus farm in South Africa’s southeast. On the other hand, the EU has expressed confidence that its measures are “WTO compatible”. A European Commission spokesperson said that the objective of the phytosanitary criteria is to protect the EU “from the potentially significant impact on agriculture and the environment, should this pest become established.” The dispute is now in the hands of the WTO. The parties have 60 days to negotiate a solution. Failing that, the complainant can request arbitration by a panel.
Kenya’s new vehicle exports rise 55 percent in half-year (Business Daily)
New vehicle dealers exported 137 units to the regional market in the half year ended June, marking a 55.6 percent jump from the 88 units they delivered to neighbouring countries the year before. Data from the Kenya Motor Industry Association (KMI) shows that the dealers, including Scania East Africa, Isuzu East Africa, and Inchcape Kenya exported their respective vehicle brands to Tanzania and Uganda.
The export market is limited due to differences in rules on vehicle age restrictions, with Kenya having one of the strictest laws that cap vehicle imports at a maximum of eight years from the date of manufacture. Kenyan companies, which have invested the most in local vehicle assembly, say harmonization of rules and incentives touching on the automotive sector could unlock more demand from the region. Kenyan firms currently hold small market shares in the neighbouring countries as measured by the exports they make against total sales.
“Looking at opportunities within the East African Community (EAC) region, the full implementation of the 25 percent duty on imported vehicles as per the EAC’s Common External Tariff (CET) would unlock tremendous benefits for the auto industry in the region,” Isuzu East Africa said recently.
Poor tax policy erodes Kenya’s investor attractiveness – survey (The Star, Kenya)
A rigid tax regulation environment in Kenya has seen Africa’s CEOs and leaders’ investor confidence in the country drop three positions in a year. According to the latest survey by Deloitte, commissioned by Africa CEO Forum, Kenya is ranked fifth with 23 per cent on Investment Attractiveness Index. This is a drop in rank from last year when the country was ranked second in the continent with an index of 6.9 per cent. “Market access and business environment are among the main criteria when choosing a site for investment,” the survey noted.
The tax change in the country’s betting, telecommunication, alcohol and corporate tax has skyrocketed in the past three financial years. Generally, in the continent, the survey notes that this year 78 per cent of the private sector leaders and CEOs are confident in the economic investor trends of African markets.
Kenyan farmers have a new market for avocado: China (The East African)
This week, Nairobi flagged off its first ever consignment of fresh avocados to China, cementing its place as the continent’s leading exporter of the fruit and the sixth largest globally. And it could be a jackpot for local farmers who had initially failed to meet the tough conditions set by Beijing.
“The net effect of accessing the Chinese market is that our avocado farmers will have more money in their pocket and increase employment in the agricultural sector,” said David Osiany, chief administrative secretary in Kenya’s Ministry of Industrialisation, Trade and Enterprise Development. At an estimated market value of $15.15 billion in 2022 according to Statista, avocado exports could transform the Kenyan economy.
EU tightens checks on fresh produce imports (Business Daily)
Europe has lowered the level of detection for chemical residues and pests on Kenya’s produce in a move that will raise the level of checks on exports of fresh produce. Exporters are now worried that a lack of compliance to the required Minimum Residue Level (MRL) by farmers will lead to frequent interception of the produce in the wake of increased checks. Europe, Kenya’s largest market for fresh produce has lowered the level to a bare minimum of LOD — level of detection — meaning that any hazard found whether high or low will be treated the same.
“These guides provide a clear explanation of what needs to be done in order to ensure that exported produce is in compliance with EU phytosanitary requirements,” said the EU in the new guidelines.
Kenya eyes US companies dumping China in Biden deal (Business Daily)
Kenya is vying to become the manufacturing hub for American companies seeking to relocate or diversify out of China in fresh trade talks Washington opened with Nairobi in July. Industrialisation and Trade Cabinet Secretary Betty Maina said Nairobi will be negotiating a deal that will lay ground for a manufacturing base for the US firms with a key focus on tech factories. “With all the changes globally, the US firms are looking at identifying new production bases for their products. They are diversifying out of their traditional production places in the Far East, particularly China,” Ms Maina told the Business Daily. “This gives us an opportunity as a country to attract these new investments. That is why it [proposed deal] is called trade and investment partnership that is informed by the need for US firms to diversify their production bases and for us to find new products [for export].”
US manufacturers operating in China are escalating decade-long plans to relocate production after being rattled by strict Covid-19 lockdowns in April and May, which further disrupted supply chains and bit into their profits.
Trade-offs for Uganda’s ‘Middle-Income’ status (Monitor)
After years of trying to attain the Middle Income status, Uganda, according to President Yoweri Museveni, has finally made it into the coveted bracket irrespective of tough economic times. In his 2022 State of the Nation Address, Mr Museveni, noted that despite locust invasion, the rising waters of the lakes, the floating islands, the landslides, the terrorist bombs, the Covid-19 pandemic and now the rising commodity prices largely caused by the Russian invasion of Ukraine, the country still managed to find its way into the middle income status. Currently, he says the economy is standing at $45.7 billion (Shs176 trillion) by the exchange rate method and at $131.6 billion (Shs507 trillion) by the Purchasing Power Parity (PPP) method. This, according to Mr Museveni means the GDP per capita is $1,046 (about Shs4 milion) which is slightly beyond the entrance points for the lower middle-income status of $1,036 (about Shs3.9 milion). Following some years of eluding the country, President Museveni disclosed: “We have passed that figure. Congratulations!”
The President was also quick to add: “However, to be declared a middle-income country, you should sustain this for two to three consecutive years. I am confident that we shall over perform in achieving that.”
Singapore, Rwanda, Kenya’s electronic single window hold lessons for Nigeria (Businessday)
While the Federal Government of Nigeria has for years been nursing the idea of introducing the electronic single window platform for cargo clearing at the ports, shippers in East African countries and Singapore are reaping the benefits of such a facility. The single window is a facility that allows parties involved in trade and transport to lodge information and documents with a single entry point to fulfill all import, export, and transit-related regulatory requirements. Kenya, Tanzania, Uganda, and Rwanda have fully embraced the Electronic Single Window System, according to a report by Trade Mark East Africa. They started with their heads of government coming together to usher in the system in one voice. The introduction of a single window, which ensures the East African countries align their Customs clearance systems to the new electronic platform, has made cargo clearance faster and more efficient.
National Agriculture Investment Plans at core deliberations in Dakar (IPPMedia)
The African Union Development Agency- NEPAD and African Union Commission convened in Dakar, Senegal, a three-day meeting to discuss the implementation of the National Agriculture Investment Plans and the progress therefor.
The main objective of the consultative meeting was to establish status of the NAIPs and RAIPs implementation in member states including linkages to the National development Plans and in the process identify lessons, challenges and opportunities that might have accelerated or delayed the implementation of the NAIPs and RAIPs.
Speaking during the opening ceremony, the CEO of the African Union Development Agency-NEPAD, Mrs Nardos Bekele-Thomas indicated that the meeting created an opportunity to engage all AU Member States and work towards strengthened financing and multi-stakeholder coordination on the Comprehensive Africa Agriculture Development Programme (CAADP) and said that it will also build on the outcomes and commitments of 2021 such as the UNFSS, COP26 and the N4G Summit.
The critical role of the NAIPs in the agriculture transformation agenda of the continent was brought to the fore once again at the Ordinary Session of the AU Assembly in Malabo, Equatorial Guinea where the Heads of State and Government adopted a Declaration on Accelerated Agricultural Growth and Transformation for Shared Prosperity and Improved Livelihoods and later referred to as the “Malabo Declaration”. The Malabo Declaration highlights seven commitments as indicators for progress and impact on the 10-year vision and goals of Africa Accelerated Agricultural Growth and Transformation (3AGT) agenda.
African trade and integration
AfCFTA records significant progress – Wamkele Mene (Ghana Business News)
The African Continental Free Trade Area (AfCFTA) agreement has made significant progress in the last few years, thanks to the commitment of the continent’s heads of state, Mr Wamkele Mene, Secretary-General of the AfCFTA Secretariat, has said. Speaking at a meeting with media managers, Mr Mene said the Secretariat had been able to make significant progress in trade rules, especially the rules of origin, which are key to measuring the movement of goods across borders.
“We have now been able to negotiate almost 90 per cent of the rules of origin. So, 5,000 products that we have in Africa we now have agreement close to 90 per cent. It is a remarkable achievement,” adding that every single item has to be negotiated. “We’ve produced all the certified documents to trade with and it is now up to the member states to cooperate diligently with the process to make sure that trade is fully exploited,” the Secretary General noted.
Strong regional value chains imperative for Africa’s economic resilience (Chronicle)
AS the world economy navigates through negative impacts of the on-going Russia-Ukraine war and its interplay with the Covid-19 pandemic, there is growing debate on rethinking global supply chain strategies with focus on strengthening resilience building mechanisms, especially for Africa, in order to cushion local economies and save jobs. The widescale Covid-19 lockdown measures experienced in the last two years and the Russia-Ukraine crisis so far this year, have clearly exposed the fragility of the globally interconnected economic system, putting on spotlight the need to bolster resilience building against future shocks, according to The Economist Magazine, June 2022.
For the African continent, which is largely dependent on supply chains linked mainly to the global north, the prevailing global disruptions pose a serious threat to many economies within the region.
Full agenda for the 42nd SADC Summit: Accelerating the industrialization drive (sardc)
The Democratic Republic of Congo will host the annual SADC Summit this month when southern African leaders will discuss regional integration and sustainable development. The theme for the 42nd Summit of Heads of State and Government is “Promoting industrialization through, agro-processing, mineral beneficiation, and regional value chains for inclusive and resilient economic growth.”
The theme continues the trajectory of the previous nine summits, building towards the integration goals of the Southern African Development Community (SADC), and resonates well with the vision of the Summit that conceived the industrialization drive, held in Victoria Falls, Zimbabwe in 2014 with a focus on economic transformation “through beneficiation and value addition”. This article is the first of a series to unpack some of the key issues expected to be considered by the 42nd SADC Summit on 17-18 August in Kinshasha.
‘Sadc cannot progress without industrialisation’ (Chronicle)
SOUTHERN African Development Community (Sadc) executive secretary, Mr Elias Magosi, has called for enhanced positive exploitation of key value chains such as agro-processing and mineral beneficiation, stressing that “the region cannot progress without industrialisation”. As the bloc focuses on development of key infrastructural projects that drive regional integration as outlined in the Regional Indicative Strategic Development Plan (RISDP) 2020-2030, Mr Magosi says robust industrialisation must take centre stage if the region is to achieve desired economic integration. Speaking during a courtesy call on him by the African Development Bank (AfDB) Group senior vice president, Ms Bajabulile Swazi Tshabalala, on the sidelines of the recent meeting of the Committee of Ministers of Finance and Investment and Peer Review Panel, held in Lilongwe, Malawi, Mr Magosi said infrastructure development and industrialisation were key components towards Sadc regional integration.
EU trade relations with Southern African Development Community (SADC) (European Commission)
The ECOWAS Bank for Investment and Development (EBID) has officially released the 2022 edition of the West Africa Development Outlook (WADO), which takes stock of socio-economic developments of the previous year and presents a macroeconomic outlook for the year 2022. The WADO discusses the socio-economic challenges of the times and postulates policy interventions that could help ease these challenges.
The 2022 WADO, which is themed, “Navigating Global Shocks through Structural Transformation and Trade”, discusses how the ECOWAS sub-region can mitigate the recent price escalation by increasing local production capacities, improving intra-regional trade and embarking on a deliberate structural transformation agenda. It also discusses the causes of the recent price hikes as being structural and the need for cautious monetary policy interventions.
Africa must strive to improve digital infrastructure – President Chakwera (Ghana Business News)
Dr. Lazarus Chakwera, President of the Republic of Malawi has noted that the vision for a “digital Africa” can only be realized if African Governments invest in indigenous solutions and workforce to drive the agenda of transformation. “Africa must be a leader in this revolution with its youthful population who are already strategically positioned to create tailored made digital solutions for Africa’s problems,” President Chakwere stated at the 11th African Internet Governance Forum (AfIGF 2022) in Lilongwe, Malawi. The forum which was on the theme: “Digital Inclusion and Trust in Africa,” was organized by the government of Malawi in collaboration with the African Union Commission (AUC) and the United Nations Economic Commission for Africa (UNECA).
Dr. Amani Abou-Zeid, African Union Commissioner for Infrastructure and Energy said “since 2020, digital technologies have proven to be the lifeline that made our communications easy, our work going and businesses functioning.
Fintech, other knowledge-intensive services could drive Africa’s prosperity, boost inclusion (Africa Renewal)
The UNCTAD report touts Opay, a Nigerian point of sale platform and mobile payment service company, which raised $400 million in 2021 and currently boasts 160 million users, including millions in the huge unbanked population. Despite such progress, hurdles remain in the way. The report lists “restricted access to finance, poor integration in regional and global markets, and a limited skills base.” As well, the fintech sector is not developed enough to support production.
AfDB to deliver climate-adapted wheat, other seeds to 20m African farmers (BusinessAmLive)
The African Development Bank (AfDB) says it is set to deliver climate-adapted, certified wheat and other staple crops seeds to 20 million farmers in Nigeria and other African countries.
The initiative, which includes the delivery of seeds and increased access to fertilisers, would be done through the bank’s African Emergency Food Production Facility as part of activities to tackle the food crisis in African countries. Akinwumi Adesina, president of the multilateral finance development institution, stated this in a recent document titled “Averting an African Food Crisis: The African Food Production Facility”.
Speaking on AfDB’s plan towards addressing the challenge, Adesina said the bank in May established a $1.5 billion African Emergency Food Production Facility and in less than 60 days, it put into action $1.13 billion-worth of programmes under the facility across 24 African countries.
Fact Sheet: U.S. Strategy Toward Sub-Saharan Africa (The White House)
Sub-Saharan Africa plays a critical role in advancing global priorities to the benefit of Africans and Americans. It has one of the world’s fastest growing populations, largest free trade areas, most diverse ecosystems, and one of the largest regional voting groups in the United Nations (UN). It is impossible to meet today’s defining challenges without African contributions and leadership. The region will factor prominently in efforts to: end the COVID-19 pandemic; tackle the climate crisis; reverse the global tide of democratic backsliding; address global food insecurity; promote gender equity and equality; strengthen an open and stable international system; shape the rules of the world on vital issues like trade, cyber, and emerging technologies; and confront the threat of terrorism, conflict, and transnational crime.
Building on the Biden-Harris Administration’s actions and commitments to deepen our engagement and partnerships in Africa during the past year, the strategy articulates our new vision for a 21st Century U.S.-African Partnership.
The new U.S. Strategy Toward Sub-Saharan Africa represents a reframing of Africa’s importance to U.S. national security interests. We will pursue four main objectives in sub-Saharan Africa:
Vital Partners, Shared Priorities: The Biden Administration’s Sub-Saharan Africa Strategy (United States Department of State)
Speech by Antony J. Blinken, Secretary Of State: Future Africa, delivered in Pretoria, South Africa, on August 8, 2022
The United States and the Republic of South Africa (United States Department of State)
China to overtake the EU as Africa’s biggest trade partner by 2030 (The Africa Report)
Asia sees Africa’s youthful population as a source of labour for its manufacturing companies and a market for its consumer goods. Although trade should be reciprocal, the continent’s trade deficit is large as it continues to import significantly more than it exports.
In recent years, the West’s already fragile reputation in Africa has worsened. The only western institution still properly active seems to be the IMF, while China on the other hand has, broadly speaking, kept up its commercial operations. Question marks are also being raised in Africa over the motives behind the re-engagement of the EU and the US … [raising] memories of past commitments and are viewed merely as a desire to counter Chinese influence rather than work with African business partners. Western engagement in Africa is not changing very much as times are changing, with the exception of more dynamic markets such as New York City that are funding startups on the continent, although the EU and US want to ensure that China does not continue to become more powerful there.
The EIU said: “Question marks are also being raised in Africa over the motives behind the re-engagement of the EU and the US … [raising] memories of past commitments and are viewed merely as a desire to counter Chinese influence rather than work with African business partners.”
As Abou El Houda, Managing Partner of Houda Law Firm in Senegal and Côte d’Ivoire told Mining Review Africa: “The challenge for Africa is in establishing where its interests converge with China’s, where they diverge, and how areas of convergence can be shaped to advance African development priorities.” Although this recent plan to increase trade with Africa by China seems to imply that the move away from an over-reliance is not happening, many governments on the continent are now more aware of the so-called ‘Chinese debt trap’ that countries like Zambia and Angola fell into post-Covid, and as such are able to better pick and choose which trade/financial flows with China works for them.
Global economy
Fostering the digital economy in small island developing states (UNCTAD)
UNCTAD has launched a new project to strengthen the capacities of 38 small island developing states (SIDS) in Africa, the Caribbean and Asia and the Pacific to adopt trade policies that develop the digital economy and enhance crisis responses. Digital technologies and e-commerce have immense potential to support the participation of SIDS in international and regional markets. They can also help build resilience and promote stronger recovery from disasters. But the digital economy is in its early stages of development in SIDS, whose common challenges to digital transformation include limited access to affordable infrastructure. And the COVID-19 pandemic has reinforced pre-existing bottlenecks in SIDS’ e-commerce ecosystem.
Importance of building evidence for gender-sensitive trade policies (Trade for Development News)
Inclusive programming has been central to the EIF’s Aid for Trade interventions in least developed countries (LDCs). This emerged from a recognition that the gains from trade are amplified when they generate opportunities for women and youth and enable micro, small and medium-sized enterprises (MSMEs) to integrate into global trade.
The OECD-WTO monitoring and evaluation (M&E) exercise has noted that mainstreaming gender into national strategies is a continuous process. This reflects our ongoing work which has been to partner with governments in LDCs to formulate and implement gender-sensitive trade policies and regulations, as well as to improve the collection of gender-disaggregated trade data.
The best policies are evidence-based, but they can be challenging to formulate in contexts where data do not exist.