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UNCTAD Trade and Development Board, 62nd Executive Session opens in Geneva
Statement by Mr. Mukhisa Kituyi, Secretary-General of UNCTAD, to the Trade and Development Board Sixty-second Executive Session in Geneva, 25 January 2016
This first Executive Session of 2016 of the Trade and Development Board comes at a paradoxical moment for the international community.
Successful agreements reached in 2015 on finance, climate, development, technology and trade offer us a modicum of hope and optimism for the future.
But we also face great uncertainty in the global economy, and a growing gap of trust between people and their governments about the interdependent world in which we live.
From terrorism to migration, from falling commodity prices and currencies to flagging trade growth, resurgent nationalisms and shrinking trust in the international system are breeding growing insecurity about how we will achieve the aspirations of Agenda 2030.
The two reports you will consider at this Executive Session, the 2015 Trade and Development Report and the 2015 Least Developed Countries Report, both outline what needs to be done to confront this challenging environment from two very different, but complementary perspectives.
The 2015 Trade and Development Report addresses the dysfunction in the international economic and monetary system that has led us to where we are today.
The Report shows how we have entered a new third phase in the global economic and financial crisis.
In the first stage, centred on the United States, most countries applied simultaneously expansionary fiscal and monetary policies that avoided the implosion of the financial system and mitigated economic recession.
In the second phase, originating from Europe, developing countries maintained strong countercyclical policies, while developed countries shifted towards fiscal austerity, relying excessively on monetary policy for economic stimulus. This shift proved ineffective for prompting a strong recovery in developed countries, while encouraging large capital outflows towards emerging economies.
Now in the third phase of the crisis, the capital flows to developing and emerging economies have stopped or reversed. Commodity prices have plummeted, and many developing countries face growing constraints to sustain countercyclical policies.
The epicenter of the crisis has moved, but the crisis itself has not been overcome. World output and international trade grew in 2015 at around 2.5 per cent, well below pre-crisis levels, and expectations on economic recovery continue to be revised downward.
This meagre growth has also relied heavily on credit. Developed country debt is currently around 265% of GDP, according to the Bank of International Settlements. Several developing and emerging countries also face growing levels of household and corporate debt, making them vulnerable to new episodes of financial instability, as we have seen in recent months.
The instability in the world economy today stems from pro-cyclical forces in commodity and financial markets.
On the commodities side, several years of high prices spurred investment, which has led to excess supply and a reversal in price trends. The current deceleration in demand is putting further downward pressure on commodity prices. Since mid-2014, food prices went down by 20 per cent, minerals and metals by one third, and oil prices by 70 per cent. On the account of some, momentum-driven algorithmic traders and big hedge funds have driven commodity prices, particularly in the energy sector, significantly beyond the point that even once-bearish commodity analysts consider justified – at least in the medium-term – by supply and demand.
The negative shock on external and fiscal balances for producing countries has been larger than the positive impact on importing countries, leading to overall declining demand.
The plummeting commodity prices have also triggered a negative reaction on the financial side, with large capital outflows from major developing and transition economies leading to currency depreciation and tightening monetary policy. This has further restrained economic growth and increased financial fragility.
These trends are a reminder of the fact that the causes of the crisis have not been sufficiently addressed. This failure to address the root causes of the crisis is now beginning to have a strong adverse impact on LDC economies.
The 2015 Least Developed Countries Report looks at the challenges facing these economies, particularly from the point of view of rural populations.
LDC economic growth declined from 5.6% in 2014 to 3.6% last year. This contrasts sharply with the post-crisis high of 7.1% in 2012. We must recall the target of 7% annual GDP growth for LDCs, enshrined in the Istanbul Programme of Actions. That target was easily achieved last decade.
But the bleak international environment is now slowing LDC economies through diminished commodity demand and shrinking aid and investment volumes.
Commodities account for over three fourths of LDC exports. Initially, as international commodity prices started declining, LDCs were still capable of compensating by expanding export volumes. But with the morose international demand for commodities, today this is no longer possible. LDC commodity export earnings are declining steeply. Total LDC exports started contracting in 2014, and the decline is projected to continually accelerate through this year. Forecasts indicate a slump of up to one third in LDC exports between the all-time high of 2013 and 2016. If confirmed, this would mean a $70-billion shortfall in export revenues in just three years.
Official development assistance to LDCs has also fallen victim to the crisis and the fiscal retrenchment measures enacted by developed countries. Bilateral official development assistance from OECD-DAC countries to LDCs shrank by 8% in 2014. The situation is compounded by the pressure to provide for a surge in immigration. Despite donor country pledges to reverse the decline in aid to LDCs, the gradual planned increase – if enacted– will still mean that aid to LDCs in 2018 remains less than that of 2013.
In terms of private capital flows, foreign direct investment into LDCs contracted by an estimated 11% in 2015. The subdued state of the world economy has led to the worldwide slowdown of foreign direct investment in natural resources. In recent years, this sector had been one of the most dynamic in LDCs, in terms of both attracting FDI and generating exports.
This negative outlook poses an enormous challenge for the optimism embodied in the Agenda 2030 for Sustainable Development. We have only fifteen years to achieve the Sustainable Development Goals, and already they seem farther away than they did just months ago.
But the strongest challenge will be where human and economic development gaps are widest, and where the pace of progress has been slowest. That is in the least developed countries. LDCs are truly the battleground on which the SDGs will be won or lost, as The Least Developed Countries Report continues to demonstrate.
And the rural areas in LDCs are the front line of our battle. Rural people in LDCs are 50 per cent more likely than their urban counterparts not to have access to sanitation or to attend secondary school. They are twice as likely not to have access to electricity, and more than four times as likely not to have access to clean water. At the same time, rural areas generate 60% of employment and one fourth of economic activity in LDCs.
The Least Developed Countries Report 2015 calls for massive investments in infrastructure and decisive financial backing and commitment of the international community to close the infrastructure gaps. It also calls on donor countries to respect their commitments to allocate 0.7% of their Gross National Income to official development assistance. At least half of the increased aid should be directed to LDCs, in line with their share of global human development gaps. And this ODA be directed to areas and sectors where LDC deficits are largest, especially agriculture, economic and social infrastructure in rural areas, and agricultural research and development.
We have a long road to travel to reach 2030, and a steeper path before us than we may have expected. But I am confident that through revitalizing our international discussion of these challenges, and by bringing these debates to the minds of people everywhere, we can re-energize confidence and we can re-ignite trade and development in a way that will deliver the SDGs.
This will be the focus of our discussions at Nairobi at UNCTAD 14, and I am pleased that Member States are already discussing these issues and will soon start negotiating the zero draft of the UNCTAD 14 outcome.
I encourage you continue this open and frank discussion at this Executive Session of the TDB over the next two days.
Thank you for your kind attention.
Key Issues
The sixty-second executive session of the Trade and Development Board is being held from 25-27 January 2016 at the Palais des Nations, Geneva. The following items are on the discussion agenda:
The Least Developed Countries Report 2015: Transforming Rural Economies
This year the Report discusses the structural transformation of rural economies in least developed countries, highlighting its critical importance to the fulfilment of the Sustainable Development Goals.
It concludes that such transformation should encompass agricultural upgrading and diversification towards rural non-farm activities to maximize the synergies between the two. Furthermore, it should foster an increase in rural demand while strengthening supply response.
The Report highlights the potential of the infrastructure investment that is needed for achievement of the Goals to generate increased rural demand. It also stresses the importance of appropriate sequencing and design, including labour-based construction methods and local procurement, to maximize its transformational effect. It concludes by outlining policies for rural structural transformation in the areas of finance, agricultural technology, enterprise and innovation, human resources and institutions.
It also emphasizes the need for the international community, having adopted the Sustainable Development Goals, to show the necessary political will in providing the means necessary to their fulfilment, including providing least developed countries with a level of official development assistance commensurate with the major challenges they face in achieving the Goals.
Trade and Development Report, 2015: Making the International Financial Architecture Work for Development
Deliberations by the Trade and Development Board under this agenda item will provide an opportunity to review some of the critical issues to be addressed in order to establish a more stable and inclusive international monetary and financial system that can support the development challenges over the coming years. The Board will consider existing shortcomings, analyse emerging vulnerabilities and examine proposals and initiatives for reform.
As background documentation for the Board’s deliberations, chapters III to VI of the Trade and Development Report, 2015 point to limitations in the functioning of the international monetary and financial system, which ideally should be able to properly regulate international liquidity, avoid large and lasting imbalances and allow for countercyclical policies. However, international liquidity and capital movements tend to respond to economic conditions in developed countries rather than to actual needs in developing countries.
The Report also looks at the role of large international banks and financial intermediaries, whose activities have increased much faster than the capacity of any public institution, either national or multilateral, to regulate it effectively. It shows that recent initiatives aiming at better regulation remain timid and narrow.
This dysfunctional regime can prevent neither boom-and-bust episodes nor recurrent debt crises. When such crises occur, it leads to asymmetric adjustment that places most of the burden on debtor countries and exacerbates a procyclical bias.
There is a need to provide a mechanism for debt resolution, particularly sovereign external debt, which minimizes the cost of the crisis, shares it fairly among the different players and restores growth and debt sustainability.
Finally, the Report examines major issues in the provision of long-term finance for development, for which specialized public institutions and mechanisms are crucial.
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Feeding Africa: AfDB holds planning meeting with Consultative Group on International Agricultural Research
The African Development Bank Group (AfDB) hosted a planning meeting with a delegation from the Consultative Group on International Agricultural Research (CGIAR) and the Forum for Agricultural Research in Africa (FARA) on January 21 and 22, 2016 in Abidjan.
The meeting was a follow-up to the AfDB’s High Level Conference on African Agricultural Transformation, which called for the continent to “execute a bold plan to achieve rapid agricultural transformation across Africa through raising agricultural productivity.”
Raising agricultural productivity depends on a number of factors, but the most critical one is new knowledge and technology generated from research. The Bank plans to partner with the CGIAR and FARA to revitalize and transform agriculture with the goal of Feeding Africa within the shortest possible time.
AfDB Vice-President, Sector Operations, Aly Abou-Sabaa, opened the meeting and underscored its relevance. The Bank’s Director of Agriculture and Agro-Industry Department, Chiji Ojukwu who chaired the discussions, pointed out that numerous studies have shown that GDP growth generated by agriculture can be up to four times more effective in reducing poverty than growth generated by other sectors.
He also observed that the Asian Green Revolution saw increases in agricultural productivity resulting from the widespread adoption of new, high-yielding rice and wheat varieties, together with the increased use of fertilizers, irrigation and other inputs. It is time for Africa’s own “Green Revolution”, he said.
The CGIAR delegation was led by Director General of the International Institute of Tropical Agriculture (IITA), Nteranya Sanginga, and included the Director Generals of Africa-Rice, the International Livestock Research Institute (ILRI), the International Food Policy Research Institute (IFPRI), the Forum for Agricultural Research in Africa (FARA) and Africa Harvest. These institutions were representing CGIAR, which includes a global network of 15 international agricultural research centres and has more than 8,000 world-class scientists and staff operating in over 100 countries.
The meeting was also attended by the consulting firm Dalberg Global Development Advisor, which has been contracted by the Bank to develop the African Agricultural Transformation Strategy. The meeting was also attended by staff from across various Bank complexes.
CITES meeting takes bold decisions in fight against illicit wildlife trafficking and on ensuring sustainability
Last preparatory meeting of CITES Standing Committee in the run-up to CITES CoP17 in Johannesburg, September 2016 – the World Wildlife Conference
With record numbers in attendance, the busiest ever meeting of the Standing Committee of the Convention on International Trade in Endangered Species of Wild Fauna and Flora (CITES) concluded with a vast array of concrete outcomes.
Significant decisions were taken concerning elephants, cheetahs, rhinos, pangolins, sharks, tigers, high value timber and other species in an effort to further strengthen the conservation of these precious species through the regulation of legal trade and the prevention of illegal trade. Decisions adopted by the Standing Committee addressed enhanced legislation, enforcement, regulatory measures, better science and new and innovative approaches to traceability, as well as livelihoods.
Substantial progress has been made under CITES to combat illegal trade in ivory, particularly through the preparation and implementation of National Ivory Action Plans (NIAPs) by 19 key countries implicated in the illegal trade in ivory. The Standing Committee agreed that the NIAPs of China (including that of Hong Kong SAR), Kenya, the Philippines, Thailand and Viet Nam had been substantially achieved and commended these Parties for their efforts. However, in the face of the ongoing high levels of poaching of African elephants, the CITES subsidiary decision-making body agreed that the massive collective effort that is underway to reverse the negative trends must be maintained. Parties that have substantially achieved their NIAPs were encouraged to continue their efforts to combat illicit ivory trafficking, and the remaining 14 Parties implementing NIAPs were urged to enhance their efforts to complete the delivery of these plans.
The Chair of the Standing Committee, Øystein Størkersen, underlined the progress made with NIAPs when he said: “The National Ivory Action Plans (NIAPs) represent one of the most successful initiatives in CITES to address complex challenges. It is designed to protect one iconic species but it should also inspire the conservation of all CITES-listed species by exposing and responding to the weaknesses in domestic legislation and enforcement and engaging with concerned Parties to remedy the situation. The recommendation to suspend trade with 3 of the key Parties for failing to report progress on NIAPs clearly signals that Parties today expect compliance with this process and a response that is commensurate with the challenges.”
Participants to the meeting applauded the progress made since COP16, in the conservation and management of sharks under CITES recognizing the unprecedented global collective effort that is underway to implement the CoP16 listings from 2013.
CITES Secretary-General, John E. Scanlon, said: “CITES is a highly effective international agreement, which was evident from last week's Standing Committee meeting. It was a good week for wildlife with the Committee taking well focussed decisions on compliance, enforcement, financing, legislation, livelihoods and sustainability. These decisions will further support the conservation of many species of wild animals and plants, including cheetahs, elephants, pangolins, rhinos, sharks, tigers and high value timber species, which were all on the agenda. We are seeing an unprecedented level of cooperation in implementing CITES both as it affects strictly regulating legal trade and combating illegal trade.
Among other things, the Committee also agreed on: major steps to address the issue of captive breeding by correcting errors made in source codes and the laundering of wild-harvested animals as captive bred; concrete recommendations to stop the illegal trade in cheetah, including through enforcement, public awareness and international cooperation; further steps to strengthen legislation, law enforcement, demand reduction and the management and control of captive breeding facilities to tackle the illegal trade in tiger; specific actions to further strengthen national inter-agency cooperation and international cooperation to enhance collective efforts in range, transit and destination to combat illegal trade in pangolin, including the application of forensic science; recognition of the vital role of traceability in ensuring legality and sustainability of trade in CITES species.
A series of recommendations to suspend trade were adopted in response to the lack of the progress in improving national legislation, failure to submit CITES trade data, non-respect of approved export quotas, persistent trafficking in timber species, the result of significant trade review and failure to report progress in NIAPs.
“While there were differences of opinion on some issues it was heartening to see the spirit of camaraderie and cooperation in the room, as was recognized by many attendees, and we look forward to this positive spirit carrying over to September when the 182 Parties to CITES convene at the CITES CoP17 in Johannesburg at the World Wildlife Conference,” added Scanlon.
Captive breeding
The Committee agreed to call for a review of the CITES rules governing international trade in specimens of species bred in captivity and to propose to CoP17 that a process be put in place to monitor all trade in specimens of species claimed to have been bred in captivity with a view to identifying and taking action in cases where specimens taken from the wild are being traded as if they were bred in captivity, thus taking advantage of less strict controls. For Asian big cats threatened with extinction which are or may be affected by trade (i.e. snow leopard, clouded leopard, leopard and Asiatic lion), the Committee agreed to call for Parties to review their national controls on facilities holding specimens of such species in captivity and for a review of the number of these and the specimens they hold in order to prevent illegal trade through such facilities.
Compliance measures: recommendations to suspend trade
The Standing Committee adopted a series of recommendations to suspend trade that will affect a number of Parties. These include:
- suspension of trade with Guinea Bissau, Liberia and Venezuela in all CITES-listed species for failing to make sufficient progress in preparing and adopting national legislation to implement and enforce CITES.
- suspension of all commercial trade with Angola, Lao PDR and Nigeria for failing to report on progress with NIAP implementation.
- suspension of trade with Bhutan, Central African Republic, Congo, Grenada, Guinea, Mali, Mongolia, Nicaragua, Panama, Rwanda, San Marino, Sao Tome and Principe, Solomon Islands and Vanuatu for failing to submit annual reports on trade in CITES-listed species if no annual reports are received within 60 days.
- suspension of trade with Lao PDR in monkeys and pythons, with Benin, Cameroon and Ghana in chameleons, with Solomon Islands in giant clams, with Guinea and Senegal in seahorses, and with Fiji in corals, resulting from the ongoing Review of Significant Trade process.
- suspension of trade with Madagascar in some high-value timber species including 48 species of Dalbergia (5 rosewoods and 43 palisanders) and 233 species of Diospyros (ebonys) in consideration of the continued illegal logging and illegal exports.
- suspension of trade with the Democratic Republic of Congo (DRC) in Psittacus erithacus (African grey parrots) for exceeding approved export quotas and the lack of scientific data on the status of the DRC populations of grey parrots.
Enforcement matters
The Standing Committee noted the need for firm and strengthened action to be taken across the entire illegal wildlife trafficking chain, on both the supply and demand sides, and encouraged further scaled up efforts at the national, regional, and global levels to combat illegal trafficking in wildlife.
The Standing Committee further recognized the important need to address corruption to effectively combat illicit trafficking in wildlife, and that it is becoming increasingly important to step up efforts to ensure that adequate measures are in place to prevent, identify and address corruption.
The increased use of tools and services available to the enforcement community such as INTERPOL Notices, secure information exchange mechanisms such as ENVIRONET, and. Wildlife Incident Support Teams (WISTs) that could be deployed upon request to support countries that have made large scale seizures of CITES specimens or that needs support to conduct complex investigations, were also encouraged .
International Consortium on Combating Wildlife Crime (ICCWC)
The Standing Committee recognized the important role that the International Consortium on Combating Wildlife Crime (ICCWC) can playin supporting increased international collaboration and coordination to combat illicit trafficking in wildlife, and the ongoing efforts of countries. The Consortium launched the ICCWC indicator framework for wildlife and forest crime at the Standing Committee meeting. The ICCWC indicator framework provides a tool for countries to measure and monitor their responses to wildlife crime through a standardized approach. It will enable countries to monitor their performance over time, and to identify any changes in the effectiveness of their law enforcement responses to illicit wildlife trafficking.
The ICCWC Strategic Programme 2016-2020, a comprehensive strategy outlining the types of activities to be pursued by ICCWC up to 2020 based on funding availability and donor support, was also launched at the Standing Committee meeting.
Legislation
According to figures released by the CITTES National Legislation Project, 88 countries and 13 dependent territories need to strengthen their legal frameworks for the effective implementation of CITES, including to combat illegal trade in wildlife.
The CITES National Legislation Project has identified 17 countries that require attention as a priority, namely Algeria, Belize, Plurinational State of Bolivia, Comoros, Djibouti, Guinea-Bissau, Kazakhstan, Kenya, Liberia, Mauritania, Mozambique, Pakistan, Paraguay, Rwanda, Somalia, United Republic of Tanzania and Bolivarian Republic of Venezuela. Most had made progress to adopt appropriate legislation before the upcoming meeting of the Conference of the Parties in September this year.
African elephant and the National Ivory Action Plans
The high levels of elephant poaching and illegal trade in ivory continue to receive significant global attention. The Standing Committee acknowledged the variety and scope of CITES responses, involving elephant range, transit and destination States, ICCWC partners and a wide range of national and international bodies and organisations. The Committee agreed on measures for discussions at CoP17.
The Standing Committee considered the progress made by 19 Parties requested to develop and implement National Ivory Action Plans (NIAPs).
The Committee agreed that China (including Hong Kong SAR of China), Kenya, the Philippines, Thailand and Viet Nam have 'substantially achieved' the implementation of the activities outlined in their NIAPs, and commended these countries for the progress made. The determination of whether these Parties remain of 'primary concern' in the elephant poaching and illegal ivory trade chain was deferred until CoP17, when the updated results of the CITES programme Monitoring the Illegal Killing of Elephants (MIKE) and the analysis of the Elephant Trade Information System (ETIS) will be available.
The Standing Committee agreed that Malaysia, Uganda and the United Republic of Tanzania have not yet 'substantially achieved' their NIAPs and these countries, together with Cameroon, Congo, the Democratic Republic of the Congo, Egypt, Ethiopia, Gabon, Mozambique and Nigeria, as Parties of ‘secondary concern', and Angola, Cambodia and the Lao People’s Democratic Republic, as Parties of ‘importance to watch, were directed to enhance their efforts with NIAP implementation, and to further report on their progress at SC67 on 23 September. The Committee agreed to recommend that Parties suspend commercial trade in CITES-listed specimens with Angola, the Lao People's Democratic Republic and Nigeria for failing to submit their reports on progress with NIAP implementation to the Committee.
The Committee could not come to an agreement on any proposed future mechanism for trade in ivory, and will inform CoP17 accordingly, together with a request directed to the CoP on whether the Committee should, or should not, continue working on developing a mechanism.
Asian Big Cats
The Standing Committee welcomed the results of Operation Protection of Asian Wildlife Species II (Operation PAWS II), which serves as an excellent example of a coordinated law enforcement effort with the common objective of identifying, disrupting and dismantling the organized criminal groups behind wildlife trafficking. The Standing Committee encouraged China, India, the Lao People’s Democratic Republic, Myanmar, Nepal, Thailand and Viet Nam to continue and further strengthen their engagement in such operations and the operational enforcement activities delivered within the framework of the INTERPOL Project Predator Tiger Crime Initiative, and any similar future initiatives.
Furthermore, the Committee adopted a set of recommendations proposed by its Working Group on Asian big cats encouraging the increased use of DNA registration, photographic identification, and other types of identification databases of captive Asian big cats, research on demand for illegal products of Asian big cats and factors driving poaching of their wild population, and the prevention of illegal online trade.
The Committee also adopted recommendations to submit a set of draft decisions to CoP17 regarding financial and technical support to Parties to effectively implement the CITES Resolution on Asian big Cats, to conduct a review of the number of Asian big cat captive facilities, to review legal and illegal trade linked to captive facilities which may be of concern, including management practices and controls in place to prevent Asian big cat specimens to entering illegal trade.
Bushmeat
The Standing Committee expressed concern that international trade in illegally or unsustainably harvested bushmeat may pose a threat to wildlife species as well as to food security and livelihoods of wildlife dependent communities. The Standing Committee revised and updated guidance for CITES Parties in this regard, to ensure that the use of wildlife consumed as bushmeat is legal and sustainable. It directed the CITES Secretariat to work with partners to assist Parties in enhancing their capacity to regulate the bushmeat trade.
Cheetahs
The Standing Committee adopted a number of recommendations on cheetahs and draft decisions to be submitted to CoP17. These recommendations and decisions will address issues such as public awareness and education schemes, international cooperation and communication, cooperation on the humane disposal of confiscated live cheetahs and the development of capacity building tools.
Pangolins
The Standing Committee adopted recommendations proposed by its Working Group on Pangolins, to submit a draft Decision as well as a draft Resolution on the Conservation of and trade in Pangolins to CoP17, for consideration, which if adopted by CoP17, will amongst others urge countries to adopt and implement or review their national legislation, ensure strict enforcement controls, strengthen national and international cooperation and carry out capacity-building activities to combat illegal trafficking in pangolin specimens.
Rhinoceros
The Standing Committee noted that a lot has been done and that a wide range of commendable activities have been implemented, are ongoing and are being planned to combat rhinoceros poaching and trafficking in rhinoceros horn. It, however, also recognized that despite these efforts, rhinoceros poaching and trafficking in rhinoceros horn continues to be a matter of great concern.
The high value of rhinoceros horn makes it a lucrative and attractive commodity for transnational organized crime groups, and it is becoming increasingly important for authorities to deploy the same tools and techniques used against other domestic and transnational organized crimes, such as the trafficking of narcotics, humans or arms, against the criminal groups involved in the illegal killing of rhinoceroses and the trafficking of rhinoceros horns, and in particular against those individuals managing and organizing these illegal activities.
The Standing committee adopted recommendations directed to India, Mozambique, South Africa, Viet Nam and Zimbabwe, all key countries in the illicit rhinoceros trafficking context. These countries were requested by the Committee to report to it on the implementation of these recommendations at its 67th meeting, which will be held immediately before the start of CoP17. The Standing Committee also agreed a recommendation requesting its Working Group on Rhinoceroses to compile a list of relevant studies, workshops, campaigns and other initiatives on reducing demand for rhinoceros horn and to produce a synthesis report covering approaches, methods, best practices and challenges experienced that can assist countries in further enhancing the effectiveness of their demand reduction strategies.
Snakes
The Standing Committee acknowledged that unregulated and unsustainable trade in snakes can pose significant threats to wild snake populations and that international cooperation is urgently needed to address these threats. In this context, the Committee agreed on extensive guidance for CITES Parties on the conservation, sustainable use of and trade in snakes.
Sharks
The Standing Committee listened to various interventions by Parties and Stakeholders praising the unprecedented progress achieved for the conservation and management of this important species group since COP 16. Overwhelming support was expressed for the work of the Animals Committee on this topic and the Standing Committee endorsed its recommendations.
The Committee will continue to discuss legal, regulatory and enforcement related issues related to the shark listings and endorsed that a draft decision to formalize its role in the conservation and management of shark species will be prepared for CoP17.
Some Parties also took advantage of the 66th meeting of the Standing Committee to publicize their proposals for the listing of additional shark species under the Convention. Sri Lanka introduced its proposal to list all three species of Thresher Sharks and the Maldives its proposal for the inclusion of the Silky Shark in Appendix II.
Timber species
The Committee considered reports from Madagascar and various other countries and organizations on the continued illegal logging and illegal exports notwithstanding the significant support provided by the international community to the Government of Madagascar. The Committee agreed to recommend that all Parties suspend commercial trade in specimens of the species rosewood, palissander and ebonies from Madagascar until that country demonstrates it has significantly increased enforcement actions at the national level. Madagascar was requested in particular to report about seizures, prosecutions and sanctions imposed for illegal logging and illegal exports, as well as on the implementation of recommendations on enforcement cooperation at the international level.
The Standing Committee further agreed that if Madagascar does not make significant progress by 25th July 2016, it will consider a recommendation to all Parties to suspend commercial trade in specimens of all CITES-listed species from Madagascar at SC 67. Finally, the Committee agreed that new decisions should be proposed for adoption at CoP17, to continue making progress on strengthening capacity to implement CITES for this valuable group of timber species.
Capacity building
The Standing Committee noted the importance of continuing the hands-on, national capacity-building activities in addition to the further development of virtual tools and regional initiatives. The Committee called for the monitoring of capacity building needs of Parties, and related activities undertaken by Parties, through the analysis of the relevant section of the new implementation report as well as through other more direct means.
Livelihoods
The Standing Committee welcomed the launching of the CITES and Livelihoods handbook, as well as the initiatives undertaken by Parties and other stakeholders with respect to assessing the positive and negative impacts of trade in CITES-listed species on the livelihoods of local communities. The Committee called for the continued promotion of the linkages between CITES and livelihoods, particularly through their incorporation in their national socioeconomic and development planning, as well as through the exchange of livelihoods experiences and lessons learnt.
Traceability
The Standing Committee reaffirmed that traceability is a vital element that ensures legality and sustainability of trade in CITES-listed species. The Committee recognized the importance of having a common understanding on traceability, as well as on the need for flexible, viable and interoperable framework that accommodate the Parties’ individual situations and conditions. The Committee adopted a draft decision on traceability to be submitted to CoP17 on traceability.
New Party to CITES
At the closing of the meeting CITES Secretary General John E. Scanlon announced that Tajikistan had acceded to the Convention as the 182nd Party, effective 30 March 2016.
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PPP Knowledge Lab: The first comprehensive online resource for public-private partnerships
Multilateral development agencies from around the world have collaborated to produce the PPP Knowledge Lab, the first comprehensive online resource that pools the knowledge and experience of industry leaders in public-private partnerships (PPPs).
Although the use of public-private partnerships to design, build, and deliver infrastructure worldwide has grown enormously in the past decade, the availability of information to support governments and their advisors in making smarter decisions on PPPs has not kept pace. Before the launch of the PPP Knowledge Lab, for example, anyone searching for information on PPPs was required to hunt down often incomplete or dated information across several platforms. Furthermore, credibility of the information or its source was often in question. The new site fills that long-standing gap in resource offerings while assuring the soundness of the information provided.
“Throughout my years conducing PPP research, it’s been time consuming to do endless byzantine web searches looking for concrete information and analysis on PPP investment by sector or by region. The information, often of dubious quality, was almost always only partially useful, and often outdated,” says Matthew Jordan-Tank, Head of Infrastructure Policy at the European Bank for Reconstruction and Development (EBRD). “This is of course even truer for the lonely PPP unit staffer laboring away in relative isolation in one of many emerging market countries,” he adds. “That’s why the PPP Knowledge Lab is as close to a revolution in information as we could ask for.”
The PPP Knowledge Lab, created with funding from the Public-Private Infrastructure Advisory Facility (PPIAF), is a collaboration between the African Development Bank, Asian Development Bank, European Bank for Reconstruction and Development, Inter-American Development Bank, Islamic Development Bank, and the World Bank Group. Together, they created a comprehensive online knowledge resource on PPPs that includes relevant information, such as infrastructure indicators and number of PPP projects in a given country, not available in one central place until now.
What’s Different about the PPP Knowledge Lab?
The PPP Knowledge Lab, designed and built by PPP professionals as a one-stop source for PPPs, allows visitors to refine searches to a desired level of specificity. This enables them to explore PPPs through various lenses, including the lifecycle of a PPP, the approach and experience of PPPs in various sectors, and country-specific PPP profiles.
Among its many unique offerings useful to PPP professionals, infrastructure analysts, government officials, and private investors, the PPP Knowledge Lab includes an online library of PPP-related documents and books, both broad and deep in its coverage. This online library provides easy access through links to materials that would otherwise be difficult to locate and retrieve.
Among the most notable features of the PPP Knowledge Lab:
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It draws upon important infrastructure and PPP resources, like EIU’s Infrascope and the World Economic Forum’s Global Competitiveness Report;
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It houses a fully searchable document library with the best possible resources on PPPs;
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It includes documents in seven different languages: English, Spanish, French, Portuguese, Arabic, Russian, and Chinese;
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Drawing from the PPP Reference Guide, it offers an overview of the PPP cycle, covering the earliest stages through implementation, and incorporating a range of resources for each step;
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It presents background on PPPs in different sectors, including power, transport, water, municipal, education, and health;
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It includes individual pages on country-specific infrastructure and PPP data, covering over 100 countries around the world;
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It parses information on PPP activity by country, including the number of projects and private investment to date, key infrastructure indicators, and the current legal framework; and
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It will continue to grow as the primary resource on PPPs, with plans to add new pages on PPPs in ICT, tourism, waste, and agribusiness in the coming months, along with coverage of constantly evolving data on PPPs in countries around the globe.
MDBs Joining Forces
Ultimately, it is the collaboration among multilateral development banks, which organized together for the common purpose of improving PPPs around the world that sets the PPP Knowledge Lab apart from any other PPP-related information resource.
“The site is the result of a collaboration among the world’s multilateral development banks (MDBs), creating a precedent for future collaborative efforts that promise significant strides forward for PPPs,” says Laurence Carter, Senior Director of the Public-Private Partnerships Group of the World Bank Group.
The development organizations that created the PPP Knowledge Lab will continue to collaborate to conceive and implement new PPP knowledge resources, as outlined here and is open to further ideas from the PPP community.
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COMESA develops CAF Sustainability Strategy
The need for the sustainability of regional integration programmes supported by the COMESA Adjustment Facility has prompted the Secretariat to develop a CAF sustainability strategy that will ensure the various programmes are continuous and self-sustaining.
Over-reliance on a single funding source which is the European Union (EU) has been a major concern on the sustainability of the COMESA Adjustment Facility (CAF) by COMESA Secretary General Sindiso Ngwenya.
COMESA Member States have often bemoaned lack of funds to address social and economic adjustments that accompany the trade and regional integration process which limit their ability to fully exploit opportunities of the region. While the private sector is seen as an engine for social and economic growth in the region, its potential is yet to be fully exploited.
Responding to the challenge, COMESA is developing a CAF Sustainability Strategy for 2016-2020 aimed at gradually weaning off the programme from solely depending on the European Development Funds (EDF) of the EU to other internal and external sources of funding.
COMESA Aid for Trade (COMAID) Coordinator Hope Situmbeko said the overall objective of the CAF Sustainability Strategy is to ensure coordinated and sustainable resources for enhancing integration programmes and ultimately achieving inclusive growth and development in COMESA.
Mrs. Situmbeko said ownership and harmonization of both external and internal sources of funding are some of the core principles to be highlighted in the CAF Sustainability Strategy.
Drawing lessons from other Regional Economic Communities (RECs) such as the Africa Union (AU), ECOWAS, EAC and the EU, the CAF Sustainability Strategy urges COMESA member states to take a leading role in funding the facility beyond COMESA Fund membership contributions.
The CAF strategy calls for the need to explore other options for raising funds that includes increased Member States and private sector contributions and setting up an agreed framework to operationalize the Common Market Levy as provided for by Article 168 of the Treaty establishing the COMESA.
Other proposed internal sources of financing include the need for the COMESA Secretariat to benefit from its institutions and agencies particularly those that are profitable through dividends and loyalties.
Since 2008, CAF has evolved from focusing on revenue loss compensation to a trade facilitation instrument for building capacities of member states in their regional integration efforts. Among the successes of the CAF, under the Regional Integration Support Mechanism (CAF/RISM) includes domestication of COMESA instruments and regulations, removal of Non-Tariff Barriers, and facilitating trade.
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tralac’s Daily News selection
The selection: Monday, 25 January 2016
Addis AU Summit updates: 31st Ordinary Session of the Permanent Representatives Committee: closing statement, AU Ministerial Retreat of the Executive Council: implementing Agenda 2063, Suspense ahead of crucial AU elections (ISS)
After the 'rising' – now reform and realism (Africa Confidential)
Five developments fuel the gloomier outlook for Africa. How are African governments likely to react to the tougher conditions?
From ODI's recent discussion 'Africa’s industrialisation: reversing the decline': download the event report, Helen Hai’s contribution
How to reform the Democratic Republic of Congo (TIME Ideas)
As a DRC native who has worked for 25 years in some 85 countries as an international development economist, mainly in country management and private sector and financial sector development, I believe turning the country around demands no less than an updated version of the Marshall Plan that rebuilt post-war Europe. The 15-year plan I propose for DRC comprises seven pillars of development, with the private sector driving growth and international and diaspora expertise tapped as needed. What will this plan cost? I estimate about $800bn over 15 years, in domestic resources, bilateral and multilateral aid, and foreign direct investment. It will also require a wholesale rethinking of development strategy and governance, with transparency a top priority. Executed wisely, it could turn one of the world’s poorest economies into a driver of African growth. [The author, Noel K. Tshiani M., is an economist at the World Bank]
A reminder: the Private Sector Investment Conference for the Great Lakes region concludes today in Kinshasa
Related: ICGLR's open letter on mineral market crisis, Amnesty International, Afrewatch report on DRC's cobalt mining sector
Full plate awaits Nigeria's Buhari in Kenya (Daily Nation)
Trade between African countries, regional security, United Nations reform agenda, climate change and economic development will form the fulcrum of discussions between President Uhuru Kenyatta and President Muhammadu Buhari of Nigeria when the latter jets into Nairobi on Wednesday for a three-day state visit.
Implementing the WTO Trade Facilitation Agreement in Ghana (UNCTAD)
This will be the first event in Ghana organized within the framework of the UK-funded project to assist in the implementation of the WTO Trade Facilitation Agreement, in close cooperation with the World Customs Organization. The event will address the National Road Transport and Transit Facilitation Committee, as well as other stakeholders. The objectives are to:
Malaysia-Africa bilateral trade to grow 4% to 5% in 2016 (Malaysian Digest)
Total exports to Africa increased by 11% y-o-y to RM19.5bil in 2014. By industry, palm oil and palm-based products accounted for the biggest export share at 32.2% of total exports to Africa for the January-November 2015 period, he said. “This was followed by petroleum products (24.4%), chemical and chemical products (7.4%), processed food (7.1%) and so on,” he said. To facilitate business networking between Malaysian and African entrepreneurs, Matrade will organise a series of seminars, forums and exhibitions this year to provide platforms to industry players to better understand the opportunities there.
ECOWAS signs MOU with China’s CGCOC on development projects (ECOWAS)
In continuation of its efforts to ensure development across the West African region, the ECOWAS Commission has signed five MoUs relating to various development projects with a Chinese conglomerate, CGC Overseas Construction Group. The five MoUs are those covering, including; the Trans-West African Railway, and the Trans-West African Coastal Highway. Others are on the West African Telecommunication Infrastructure Facilities, and the West African Regional Aviation Field as well as that of Construction of New ECOWAS Headquarters and related facilities in Abuja, Nigeria.
West African Common Position towards UNGASS 2016 (WASCI)
We, representatives of government ministries, law enforcement agencies, drug policy experts and civil society who participated in the Regional Consultation on Drug Policy Reform on “The Road to UNGASS” which was held in Ghana from 19-20 January 2016, which attracted 11 West African countries (Benin, Burkina Faso, Cabo Verde, Cote D'Ivoire, Ghana, Guinea, Guinea-Bissau, Liberia, Nigeria, Senegal, Sierra Leone) hereby make the following declaration with respect to drug policy reform in West Africa:
Business groups endorse intercontinental highway from Sicily to Cape Town (BusinessDay)
Not less than 90 business groups around the world have endorsed the proposed intercontinental highway, known as the Europe-Africa Business corridor, that is to run from Sicily in Italy, through strategic countries including Lagos to Cape Town in South Africa. Twenty out of the 90-business group expected to drive the gigantic project designed by a team of Italian professors are said to come from Africa. The groups are mostly societies of engineers from different countries. The outcome of the business corridor would be the emergence of a powerful business block between Africa and Europe, and later Asia, which they said, would be co-opted. The World Bank is said to be behind the project.
Rwanda aims to be EA’s logistics hub (The East African)
According to Dubai Port, the first phase of the Inland Container Depot, at the Kigali Logistics Platform, is set to be complete in 18 months’ time, raising hopes that it will contribute to the ease of doing business in the country. When completed, analysts are optimistic the dry port, which is linked to both the Northern and Central Corridors, will allow Rwandan importers and exporters to consolidate volumes of cargo.
Uganda: Government’s shift from dollar to shilling contracts sparks mixed reactions (Daily Monitor)
Mr Gideon Badagawa, executive director Private Sector Foundation Uganda, said this move plays a role in reducing demand for the dollar and gives an advantage to local companies. “My opinion on this has always been the same. We need to strengthen our economy and by reducing dollarisation, that is a good move. I do not see why local contracts have to be in dollars. If we are paying a local consultant, why do they have to quote dollars? Does it even make sense?”
EAC, Germany sign 37 million Euros agreement to support regional integration (EAC)
The Federal Republic of Germany signed an intergovernmental agreement with the East African Community to support the economic integration, regional health facilities and water resource management. Germany will support the EAC in promoting private investment especially in the pharmaceutical sector, including the establishment of a regional quality infrastructure for the pharmaceutical sector.
SADC Secretariat, China commit to enhance co-operation (SADC)
They agreed to strengthen SADC-China cooperation in line with the Resolutions and Plan of Action that was adopted during the Summit of the Forum on China-Africa Cooperation, held in Johannesburg on 4-5 December 2015. The Ambassador reiterated the Chinese government's commitment to strengthen cooperation with the SADC Secretariat and SADC Member States. In that regard, the two parties agreed to explore ways of the establishment of a platform of closer cooperation for mutual benefits. [US Ambassador in Botswana meets SADC Executive Secretary (SADC)]
Economic internet toolkit for African policy makers (World Bank)
Liberalization of the telecommunications sector is progressing across Africa. One of the most important benefits of this trend is that it will make value-added services, particularly internet access, more affordable and reliable for telecommunications users in the continent. The internet need not be a useful tool only for industrial societies. This toolkit is inspired by the African experience where access to the World Wide Web is helping doctors to save patients, schools to educate children, and communities to create businesses that will lift them out of destitution. This toolkit closely examines these issues. [Uganda: Tech meets agriculture at #Hack4Ag (World Bank Blogs)]
Women’s role in achieving a food secured Africa (IFPRI)
The importance of women empowerment to enhancing agro-productivity and hence combating poverty as underscored in the AU Agenda 2063 is indeed validated by the statistics. Women produce up to 80 percent of food in Africa, both for household consumption and sell, work more average hours in African farms – up to 467 minutes daily compared to 371 minutes for men in some countries, and yet remain marginalized from factors of production.
Price seasonality in Africa: measurement and extent (World Bank)
This study systematically measures seasonal price gaps at 193 markets for 13 food commodities in seven African countries. It shows that the commonly used dummy variable or moving average deviation methods to estimate the seasonal gap can yield substantial upward bias. This can be partially circumvented using trigonometric and sawtooth models, which are more parsimonious. Among staple crops, seasonality is highest for maize (33% on average) and lowest for rice (16½%). This is two and a half to three times larger than in the international reference markets.
New 'Champions 12.3' coalition inspires action to halve global food waste (UNEP)
A coalition of 30 international leaders launched their Champions 12.3 initiative at the World Economic Forum in Davos today to inspire ambitious action on reducing global food loss and waste. The group's name is a reference to Target 12.3 of the Sustainable Development Goals, which seeks to halve per capita food waste and reduce food losses by 2030. The coalition will be Co-chaired by UNEP Executive Director Achim Steiner and Tesco Group Chief Executive Dave Lewis. [Collymore appointed to the Global Commission on Business and Sustainable Development (Daily Nation)]
Harnessing the power of Africa's swing states: the catalytic role of Nigeria, Kenya and South Africa (Brenthurst Foundation)
In August 2015 the Brenthurst Foundation and the Konrad Adenauer Stiftung convened a high-level Dialogue to examine three countries in sub-Saharan Africa - Kenya, Nigeria and South Africa - which are particularly illustrative of the importance of swing states to regional and continental success. The three countries were selected on account of their relative economic and diplomatic weight, location and level of international integration (regionally and globally) - factors which could make them engines of regional growth and stability. Three key assumptions underpin why, this Paper argues, the performance of swing states bear particular attention:
World Trade Monitor November 2015: volume of world trade decreased 0.1% (CPB)
Why exports hold the key to Kenya’s economic take-off (Business Daily)
Angola and Zambia with five million dollars trade (Angop)
South Africa: Local manufacturers look beyond the borders to keep the lights on (Business Day)
Chinese deputy trade minister to make three-day visit to Senegal (Star Africa)
The Lake Chad development and climate resilience action plan: summary, main report
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The digital transformation of logistics: Threat and opportunity
Digitalization threatens to fundamentally disrupt logistics but could also help the industry reduce its inefficiencies and shrink its environmental impact.
Over the past two decades, as the Internet revolution swept the world, our day-to-day lives have become increasingly digital. With email eclipsing ‘snail mail’ and digital downloads replacing physical products, this could well have dealt a devastating blow to the logistics industry. But in fact, something remarkable has happened: more packages than ever before are now being shipped. On any single day, a staggering 85 million packages and documents are delivered around the world.
Demographic and digital trends are combining to drive growth, but logistics businesses cannot afford to rest easy and enjoy the fruits of this global boom in shipments.
Logistics has introduced digital innovations at a slower pace than some other industries. This slower rate of digital adoption brings enormous risks that, if ignored, could be potentially catastrophic for even the biggest established players in the business.
As other industries with close links to logistics, such as retail, are revolutionized by digital technology, the chances of digital disruption engulfing the logistics industry increase – for instance, the rise of e-commerce has led to new digital entrants in the last-mile delivery market.
More significantly, digital platforms will become increasingly important in the logistics industry, allowing small companies to have a global reach and compete with the sector’s established giants. Over the next few years, the race to build a dominant global platform will transform the customer’s experience of logistics and will be the central issue in determining which enterprises will be the winners and losers in a truly digital logistics industry.
With the logistics industry suffering from some very significant inefficiencies – for instance, 50% of trucks travel empty on their return journey after making a delivery – digital transformation can also bring important social and environmental benefits by increasing efficiency and cutting down energy consumption and emissions.
Our analysis indicates that there is $1.5 trillion[1] of value at stake for logistics players and a further $2.4 trillion worth of societal benefits as a result of digital transformation of the industry up until 2025. In other words, industry stakeholders should take notice and come together to prioritize digital transformation initiatives given the potential for significantly higher value to be created for society than for industry.
We have identified five themes that will be central to the digital transformation of the logistics industry over the next decade:
The time and complexity required for these initiatives to reach scale across the market vary significantly. We have identified certain underlying requirements that are the building blocks for the digital transformation of the logistics industry, which we outline in our recommendations. Two of the most important ‘no regret’ capabilities include: companies should improve their collection of data from all along their value chain; and enterprises should ensure they have the capability to analyze big data streams to derive insights that improve operational efficiency and enable the launch of new services, such as last-mile delivery.
We raise three key questions for logistics industry leaders and stakeholders to consider and address:
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Should the larger industry players continue to invest in scaling their existing closed platforms or should they be adding new business models such as crowdsourced platforms and analytics as a service?”
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How can logistics stakeholders incentivize faster implementation of shared warehouse and transportation capacity to reap significant societal and customer benefits?
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Logistics contributes 13% of all emissions globally. In light of the COP21 Agreement in Paris, how can industry stakeholders quickly agree on developing safe and trustworthy approaches to more environmentally friendly technologies such as autonomous trucks and drones?
[1] Disclaimer: These calculations are subject to change. Impacts are based on estimates and would vary in range given a change in adoption rates or disruption in any of the initiatives
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In Zurich, Ban calls strongly on governments to ‘leave no one behind’ in new era of global sustainability
If the landmark Millennium Development Goals (MDGs) were a pact between donors and recipients, the 2030 Agenda must become the basis of a new social contract, United Nations Secretary-General Ban Ki-moon said on 22 January 2016, urging governments to show strong ownership in the framework by aligning policies, legislation and resources so that people and the planet can benefit.
“Governments made a universal promise to all people – and citizens of the world can now demand that governments honour these promises,” the Secretary-General told delegations at the told delegations attending the Zurich Development Conference, where he made a strong call on governments to back the 2030 Agenda and its 17 Sustainable Development Goals (SDGs).
“All States and all actors own this Agenda, which aims to finally end the tyranny of poverty,” continued the UN chief, adding that where the MDGs were carried out through the development system, the SDGs must become the object of a dialogue between the State and its people, “between duty-bearers and rights-holders, between those with resources and those in need.”
He said that in the course of discussions on the 2030 Agenda, particularly business community and civil society were urging the Governments and the UN to provide a far-reaching vision. “I think UN Member States have now delivered,” he said emphasizing that the Goals represent virtually all the aspects and spectrums of our lives, including the environmental conditions of our Planet Earth.
“Now I am urging business communities and civil society to respond to the visions of world leaders. The world leaders, of course, have political responsibility to make sure these are owned by each and every government through their national legislations and other administrative measure,” the Secretary-General said, adding however that without the strong support, contributions and engagement by civil society and the business community, this might not be implemented.
The 2030 Agenda, he continued, commits to leaving no one behind. The basic [premise] is that 7 billion people – maybe 8 billion by the end of 2030 – that everybody without any exception should be able to live sustainably and a healthier way.
“This is a pledge that resonates well here in Switzerland. The preamble of your Constitution perfectly expresses this spirit by affirming that ‘the strength of a people is measured by the wellbeing of its weakest member,’ he noted, adding that the Swiss Government has already presented that far-reaching vision.
This applies to cantons in Switzerland – and it also applies to the most vulnerable in the international community. This applies not only to the least developed, fragile and failed States – but also applies to struggling people in any society.
“The only challenge greater than achieving agreement on the SDGs is the one we face now, it has been very difficult, sometimes passionate, emotional in the process of negotiation every single world, every single paragraph was the subject of intense negotiation. Now this is over, the greater challenge is to implement these agreements,” said Mr. Ban.
As such, he stressed that each and every Government needs to show strong ownership by aligning policies, legislation and resources in support of the Sustainable Development Goals. “We need visionary political leadership that sees beyond the national borders. We need effective institutions that break silos. These 17 goals, they are universal, they are all integrated, all are indivisible, you cannot separate one from the other,” he said.
He explained that they had been negotiated globally in two threads. One thread was climate change: the UN Framework Convention on Climate Change (UNFCCC) had negotiated during the last 18 years on Goal 13. The rest of the 16 goals were negotiated at the last UN General Assembly. “They were negotiated differently but they are one. Nothing can, and should operate in separation. They are one part of our vision,” said the UN chief.
The recent Paris Agreement on climate change represents a first of many steps the international community will have to take to achieve the SDGs, he said, adding that there are many cross-cutting issues like food, water, energy, gender and climate. Those are cross cutting issues which affects us all. Particularly if Goal 13 is not properly addressed, “all the gains which we will make will be seriously undermined.”
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AfDB presents New Deal on Energy for Africa and the Transformative Partnership on Energy in Davos
“If you want to go fast, go alone. If you want to go far, go together.”
The African Development Bank Group (AfDB) presented its New Deal on Energy for Africa, and launched a Transformative Partnership on Energy at the World Economic Forum (WEF) in Davos, Switzerland, on January 20, 2016.
The New Deal on Energy for Africa is a transformative partnership-driven effort with an aspirational goal of achieving universal access to energy in Africa by 2025. To drive and achieve this goal, the African Development Bank is working with governments, private sector, bilateral and multilateral energy sector initiatives to develop a Transformative Partnership on Energy for Africa – a platform for public-private partnerships for innovative financing in Africa’s energy sector.
Akinwumi Adesina, President of the AfDB Group, was joined by global political and business leaders, who discussed the New Deal on Energy for Africa and the Transformative Partnership on Energy for Africa and were invited to share their experiences on how, together, all partners can mobilize support to achieve universal access to electricity in Africa by 2025.
The inaugural statement was made by the “Champion” of the New Deal, Kofi Annan, Chairman of the Africa Progress Panel, who referred to the film presented by the African Development Bank on the subject, which emphasized the need to act quickly.
Annan’s statement opened a series of speeches delivered by Adesina; Daniel Kablan Duncan, Prime Minister of Côte d’Ivoire; Paul Kagame, President of Rwanda; Hailemariam Desalegn, Prime Minister of Ethiopia; Alpha Condé, President of Guinea; Gayle Smith, Administrator of the United States Agency for International Development (USAID); Tony Elumelu, Nigerian entrepreneur and philanthropist; Rachel Kyle, CEO of the UN Sustainable Energy for All (SE4All), Ashish Thakkar, Executive Chairman of Mara Sokoni; Marco Lambertini, Director-General of World Wildlife Fund International; Charlotte Petri Gornitzka, Director-General of the Swedish International Development Cooperation (SIDA); and Bono, Irish singer-songwriter and philanthropist.
All political leaders were unanimous: the political will and unity between countries are important. Countries need to work together regionally. Business leaders announced their support to realize the New Deal on Energy for Africa.
In his address, AfDB President Akinwumi Adesina said, “The importance of energy in society was clearly underscored in 2015 with the inclusion of energy in the Sustainable Development Goals. Hence, lighting up and powering Africa is a key priority for the Bank”.
“The ‘New Deal on Energy for Africa’ sets the ambitious target of universal access by 2025, which means bringing modern energy to 900 million people in Sub-Saharan Africa, to cover for those who do not currently have access as well as the expected population growth. This implies a step change in the way that the Bank, African countries, development partners and the private sector approach the energy sector on the continent,” he said.
“To succeed, we must work together. As the African proverb says: ‘If you want to go fast, go alone. If you want to go far, go together’. Hence, the African Development Bank is working with governments, the private sector, bilateral and multilateral agencies – several of whom are represented here – to develop a Transformative Partnership on Energy for Africa. This will provide a platform for public private partnerships for innovative financing for Africa’s energy sector,” Adesina said.
Download: pdf The Bank Group’s Strategy for The New Deal on Energy for Africa 2016-2025 (2.24 MB)
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AU Ministerial Retreat of the Executive Council brainstorms on the implementation of Agenda 2063
Members of African Union (AU) Executive Council converged in the Tigray region of Mekelle, on 24 January 2016, within the framework of their third Ministerial Retreat, holding under the theme: “Implementation of Agenda 2063”.
The Ministerial Retreat was chaired by Hon. Simbarashe S. Mumbengegwi, Ministers of Foreign Affairs of the Republic of Zimbabwe and Chairperson of the Executive Council, in the presence of H.E. Dr Nkosazana Dlamini Zuma, Chairperson of the African Union Commissioners, H.E Mr. Erastus Mwencha, Deputy Chairperson of the AUC. Hon. Dr Tedros Adhenon Ghebreyesus, Ministers of Foreign Affairs of the Federal Democratic Republic of Ethiopia, H.E Abay Weldu, President of the Regional Authority of Tigray, representatives from AU Organs, the UNECA, NEPAD, RECs AfDB, AU Commissioners, the AUC Secretary General, and the Legal Counsel of the AUC, and invited guests.
President Weldu welcomed the participants in the city of Mekelle and presented the historical background of the region which he qualified as courageous and privileged population who inherited the most archeological objects and sites of humanity. He said the agenda of this retreat has a significant meaning to the Tigray tribe/people of Ethiopia. He appreciated the vision of the Union aimed at creating an “integrated, prosperous and peaceful Africa”.
In her opening remarks, Dr. Nkosazana Dlamini Zuma, AUC Chairperson, recalled the first retreat in the city of Ethiopia Bahir Dar in 2014, where she introduced the Dream of the African People in “the e-mail from the future”, among others.
“Two years ago, as we concluded the 50th anniversary of the OAU/AU, we met as in retreat in the city of Bahir Dar, to discuss the core responsibilities of this important organ, the Executive Council. It was then when I spoke about our dream of the Africa we want, in the e-mail from the future. Two years later, as we gather here in Mekelle, Tigray region we can report that we have made some headway. As discussed at this retreat, we now have Agenda 2063 as our clarion call for action, supported by all sections of the African society,” stated the AUC Chairperson.
She explained that “we are now clear on the priorities of Agenda 2063, investing in our people, especially youth and women; in agricultural modernization and agro-businesses; in manufacturing and industrialization; the development of our infrastructure; democracy and developmental governance, as well as the need of silencing the guns by 2020.”
“Our Agenda 2063 flagship projects – such as the free movement of people, the Commodities strategy, the Pan African Integrated High speed Rail network – is taking off, and should help towards our vision of an integrated, peaceful and prosperous Africa, driven by its own people and taking its rightful place in the world,” underscored Dr. Dlamini Zuma.
Referring to the song on Agenda 2063 composed by a group of artists from Zimbabwe, played during the opening ceremony of the retreat, the AUC Chairperson called on other artists within the continent to emulate the good example. “I would like to thank the Zimbabwean artists who came up with that song on Agenda 2063, and I challenge all of us to encourage our artists to compose as many songs as possible. Of course as the Chair of the Union, Zimbabwe led from the front.” She thanks the Mekelle authorities for hosting the AU Ministerial retreat and wished the Ministers fruitful deliberation.
The Chairperson of the Executive Council on his part, recalled the high moments and priorities on Agenda 2063, saying “our Agenda is centred in the review of implementation of decisions taken during the 2nd Ministerial retreat and update on the implementation of the 1st ten year plan of Agenda 2063, the free movement of goods and persons, the issue of Immigration and tourism and wild life preservation”.
Minister Mumbengegwi stressed that “as we continue streamlining and improving the working methods of our Union, we also need to consider how best we can align our bi-annual Summits in order to improve the effectiveness of our organisation and to give ourselves ample time to implement our decisions”. He expressed satisfaction to the fact that notable success has already been achieved in this vein, hence the need to proffering new and innovative ideas that will take the organisation to greater heights.
Speaking earlier, Hon. Dr. Tedros Ghebreyesus, stressed on the importance of holding the ministerial retreat which he said will enhance friendly and convivial relationship between the ministers. The Minister of Foreign Affairs of the Federal Democratic Republic of Ethiopia said such gathering will enable the participants to express themselves freely while socialising with one another. He called on his pars saying, “We have a number of important issues to deliver including exchanging views and best practices on how to domesticate and enhance the implementation of agenda 2063 and its flagship projects.”
Organized by the African Union Commission (AUC), the third Ministerial Retreat aims at brainstorming and exchanging ideas on critical issues related to the implementation of the Africa Agenda 2063 so as to give clear direction and guidelines on devising best ways and means for its domestication to help improve the living conditions of the African citizens.
The Ministers will among other things consider AU Commission Restructuring Project, the free movement of people, African tourism, wild life conservation, and state of the African tourism sector and its opportunities and challenges.
At the end of its deliberations, the Ministerial Retreat will adopt the Mekelle Ministerial Retreat draft Outcomes document to be tabled during the Executive Council meeting scheduled to hold on 27 and 27 January 2016 for adoption. The AU Ministerial Retreat ends on Tuesday 26th January 2016.
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31st Ordinary Session of the Permanent Representatives Committee (PRC): Closing statement
The 31st Permanent Representatives Committee (PRC) Ordinary Session took place from 21 to 23 January 2016 at the headquarters of the African Union (AU) in Addis Ababa, in the presence of the AUC Deputy Chairperson, Mr. Erastus Mwencha, AU Commissioners representatives from AU Organs, the RECs and invited guests.
During the opening ceremony, the Chairperson of the AU Commission, H.E. Dr Nkosazana Dlamini Zuma, highlighted some of the achievements of the Commission in 2015, including the progress made in the implementation of the AU Agenda 2063 and the process of domestication to ensure that the AU’s major priorities are taken into consideration.
She said the AUC Annual report presented during the Summit would underline all the areas of interest including the African skills revolution, health and nutrition; infrastructure that connects the continent, its citizens and that spur social and economic development; agriculture and agro processing; economic diversification, job creation and industrialization; peace, security and democratic governance.
Flagship projects of the Agenda 2063 such as the Pan African Integrated High Speed Rail Network, the Continental Free Trade Area and Commodities Strategy, on Agriculture and Agro-businesses, on the African Economic Platform, Silencing the Guns, the Single African Aviation Market, on the Free Movement of People and the African Passport, would also be presented in the Commission’s report.
The PRC would further exchange views on the draft agenda as well as the draft Decisions and Declarations of the 28th Ordinary Session of the Executive Council, scheduled to hold on 27 and 28 January 2016, and those of the 26th AU Summit, before adopting their report.
The meeting of the PRC was officially closed on Saturday, 23 January 2016.
Closing Statement by H.E. Albert R. Chimbindi, Chairperson of the Permanent Representatives Committee (PRC), on the Occasion of the 31st PRC Ordinary Session
Addis Ababa, Ethiopia, 23 January 2016
Let me start by expressing my profound gratitude and pleasure that we have come to a timely and successful conclusion of the 31st Session of the Permanent Representatives’ Committee (PRC). As the curtain comes down on this meeting, we have to pat ourselves on the back for the expeditious manner in which we tackled our long agenda. Over the past two days we have had a very enriching and insightful debate on many issues of critical importance to the work of our Union. Our individual and collective determination and commitment helped to achieve results that we have. I want to thank each and everyone of you for your support and cooperation, and for your valuable contributions, and robust participation. I wish to express my profound appreciation to the various presenters for eloquently and comprehensively articulating the issues under their mandates. This helped us to have focused discussions.
Over the past two days, we had the opportunity to look back and reflect on how we have fared in the implementation of the mandates given to us by our Principals, in an honest and frank manner. We also looked at the challenges that we have faced and the ways to overcome them, as we match towards the creation of the Africa we want. There were times when the debates became heated, but the unity of purpose always helped us to find common ground and move forward, together.
Allow me to recap some of the important issues that we have deliberated on. These, inter-alia, included the review of our partnership with the rest of world and how these should have continental added value; the ongoing restructuring of the African Union Commission and other AU Organs and Agencies to enable us to have a lean, effective and efficient Executive; the financing of our organization in a manner that promotes, protects and safeguards African ownership of the African Agenda, and the streamlining of the methods of work and procedures to make our Organization deliver more with less. We received and deliberated on the reports of Specialized Technical Committees (STCs), the Organs of the Union and several Sub-Committees. We have made observations and recommendations for the consideration of the Policy Organs of the Union.
The past year of Zimbabwe’s Chairmanship has, indeed, been exciting but also challenging. On behalf of the outgoing Bureau of the PRC, which I had the privilege to lead for the past year, I would like to thank you most sincerely for the trust and confidence you reposed in us to make our modest contribution to the achievement of the goals of our Pan African Organization. I want to assure you that we have tried our very best, to effectively discharge our responsibilities. I hope we have lived up to the expectation of all the Member States.
On our part, we are satisfied with the progress that we have made over the past one-year in implementing the priorities of the Union. I want to congratulate the Members of the Bureau, namely the Democratic Republic of Congo (DRC), Niger, Kenya and Mauritania, for the exemplary team spirit, for their dedication and commitment. I shall forever cherish the time that I was privileged and honoured to work with the Members of the outgoing Bureau. To all of you my Colleagues, Ladies and Gentlemen, I want to express my profound appreciation for your support and solidarity which helped to lighten, an otherwise very onerous responsibility. I look back with pride over the unqualified support and the availability of each and everyone of you.
Let me also give special thanks to my region, Southern Africa, for their courage and confidence. Ambassadors from my region, very ably led by Her Excellency Ambassador Molefe, our Regional Dean, helped me to settle down and walked with me shoulder to shoulder during this whole journey. I want to say to my region and, of course, to the entire Membership of the Union, thank you for the opportunity given me to lead and chair the PRC, for the past twelve months. I pledge to continue contributing to the work of the PRC and wish to assure my successor of my unqualified support, and solidarity and, also, my full cooperation.
It would be remiss of me, if I concluded without extending special thanks to Dr. Nkosazana Dlamini-Zuma, Chairperson of the Commission and the entire team of Commissioners, Directors and other staff for the excellent working relationship that we enjoyed during our Chairmanship. My heartfelt appreciation also goes to the Secretary General of the Commission, Ms. Djeneba Diarra, and her predecessor Ambassador Jean Mfasoni and all the staff in the Office of the Secretary General, for assistance rendered to the Office of the Chairperson of the Union. Last, but not least, I wish to commend the entire staff of the Commission and give special mention to the interpreters, translators and other support staff for facilitating our work.
I now declare the 31st Ordinary Session of the PRC officially closed.
I thank you.
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Economic Internet Toolkit for African policy makers
Liberalization of the telecommunications sector is progressing across Africa. One of the most important benefits of this trend is that it will make value-added services, particularly Internet access, more affordable and reliable for telecommunications users in the continent.
The Internet need not be a useful tool only for industrial societies. The poor in many African countries, struggling to meet basic needs, often remain poor not only because they are denied access to physical and human capital, but also because they lack the information necessary to best convert that capital into wealth. By opening wide the door to a huge store of global knowledge, the Internet offers untapped possibilities to address the blight of information poverty. This Toolkit is inspired by the African experience where access to the World Wide Web is helping doctors to save patients, schools to educate children, and communities to create businesses that will lift them out of destitution.
Today there is growing exposure to the Internet in Africa. Over the last three years, the number of Internet host sites, excluding the developed market of South Africa, has risen twenty-fold. However, there are still many hurdles to a comprehensive coverage of African nations. Issues that require urgent deliberation include pricing structures, monopoly controls and licensing charges. Often these are a result of state policies restricted by a short-term view of the economy and its future, or by concerns over the immediate effect of the Internet on telephone company revenues.
This Toolkit closely examines these issues. It finds that, in the long term, the Internet cannot be looked upon as a threat to telecommunications companies. It is true that it is one of a range of technological advances that are forcing changes in the the operation of telecommunications systems, but it also presents opportunities for new sources of revenues and new ways to meet the demands of society. The Internet has become a tool for development, with its ability to facilitate the delivery of social services, disaster mitigation, and poverty relief. The Toolkit also finds that the move toward liberalization is likely to have a beneficial effect on Internet roll out, just as it has on basic service provision.
Introduction
As the old telecommunications regime crumbles around the world and a new one emerges, Africa has an unprecedented opportunity to vastly improve its information technology and communication infrastructure. African nations, however, must act quickly to gain access and contribute to the world's knowledge base, communicate with global neighbors, and fully participate in the development of a global information society.
The Internet represents a technology that encapsulates much of the promise of this information revolution. This toolkit aims to assist African policy and decision makers to better understand how the Internet is different, its costs and benefits, and policy issues that surround this new technology.
Despite the low level of telecommunications development in the African continent, the Internet has expanded relatively rapidly over the past few years. Private, nonprofit, and public sector Internet service providers have sprung up to help exploit the opportunities presented by this new technology. At the time this report was written, 42 of the 54 nations in Africa had live public access to the Internet in the capital city, while eight had countrywide local dial-up access. These were Burkina Faso, Malawi, Mali, Mauritius, Morocco, Senegal, Chad, and Zimbabwe. Competition (where allowed) can be fierce, and the price for "all you can eat" web access dropped below US$30 I month for some countries in the region. In Mozambique, one of the least developed nations of the continent, it is possible to make a telephone call over the Internet today. Largely because of the efforts of private operators, the number of host sites in African countries has increased from 290 in five countries in 1995 to 6,510 in 32 countries in 1998. These figures exclude South Africa, which alone has 129,000 sites. However, the Internet has been growing so rapidly worldwide (at a rate of 12 percent a month), that Africa's share of host sites has been falling over the last year. Africa's share of Internet host sites worldwide was a mere 0.025 percent in 1997, and fell to 0.022 percent by the beginning of 1998. Excluding South Africa, the entire continent with its population of well over 650 million has about as many Internet sites as Croatia with its population of five million.Twenty-two countries across the world, with populations of over one million, have no Internet host sites at all. Of these, 16 are African: Zaire, Chad, Somalia, Sierra Leone, Sudan, Rwanda, Malawi, Mauritania, Mali, Lesotho, Guinea, Gambia, Eritrea, Congo, the Central African Republic, and Burundi. In fact, outside South Africa, only one out of every 5000 Africans have access to the Internet.
Infrastructure and development
Further growth of the Internet in Africa is closely tied to the quality and availability of telecommunications infrastructure in this vast continent. A major component in this process is the liberalization of the sector and private sector investment. In sub-Saharan Africa, change is already underway; 25 countries have begun reform programs in telecommunications. However, how much these reforms will immediately impact the growth of the Internet is yet to be gauged.
The Internet places large demands on infrastructure with its requirements of high quality and high speed connections. Service providers need cheap and reliable access to international communications lines to link with the web, as well as equally reliable local access for their customers. This need for high bandwidth infrastructure creates serious pressures on the less developed telecommunications networks of the world. This is certainly true of most African nations, which have only two percent of the world's telephones to offer to 12 percent of the world's population.
While there are very advanced networks in some African countries like Rwanda and Botswana, others, like Madagascar and Uganda have unreliable analog systems. The proportion of digital lines on the continent is 56 percent as compared to a global low income average of 90 percent. Advanced technologies such as ISDN, mobile telephony and leased lines are still not fully developed in most African countries. Despite this, Africa has a great opportunity to leapfrog such constraints by using cheaper technology such as wireless local loop, low earth orbiting satellites, and the ability to send data over the electricity grid.
Cost structure and development
Another, no less serious, challenge to the development of the Internet in Africa is the existing cost structure for access to the network. At the moment telephone charges represent an insignificant cost for those who have local access to an ISP used only for electronic mail. For any user accessing the World Wide Web, and for email users accessing the Internet from outside a local dialling area, telephone charges become very significant. For instance, the percentage of costs for local Internet access that go toward telephone charges and ISP charges is 58 percent of the total user cost. For a user who accesses an ISP from outside a local calling area, telephone and ISP charges skyrocket to 86 percent of total user cost. Furthermore, Internet Service Providers (ISPs) pay a large percentage of their costs for connectivity: 48 percent of ISP costs are accounted for by Internet backbone connection and international leased line costs.
While the Internet is threatened by inefficient telecommunications infrastructure, unreformed African telecommunication companies in turn feel threatened by the impact that the Internet might have on their revenue stream.
In fact, while the Internet is likely to divert traffic from high revenue-generating international voice communications and adversely affect the profits of African telephone companies over the short term, the relative impact of the Internet on revenue is not significant. In markets that have not yet seen any reform, and where there is greater dependence on overpriced international call charges, the Internet is likely to be utilized to bypass these costs. However, the Internet is only one of a number of forces that will have an impact on telecommunications companies in the region. There are many others,such as international pressures on regulating accounting rates charges, and the growing presence of callback technology. Even countries with advanced Internet provision are probably experiencing only about one percent of revenue reduction directly resulting from email substitution. U.S. accounting rates settlement payments to African countries are significantly larger - 2.4 percent of Mozambique's revenues, for instance, or 14.3 percent of Ghana's. Furthermore, while in the longer term, Internet telephony probably represents the larger Internet-based threat to telecommunications company revenue, at the moment the level of capacity in most African countries is insufficient to support this technology.
To be genuinely competitive in the global marketplace, African telecommunications companies need to rapidly integrate the changes that are reshaping telecommunications across the world, and transforming it into a commodity business. By embracing Internet technology and expanding the number of users who can access the network, these companies have a considerable amount more to gain in the long run. At the same time, the growth of the Internet offers new opportunities for businesses and communities on the continent.
The Internet is good business
Models presented in this toolkit suggest that expansion of the Internet in Africa can provide opportunities for significant reduction in the communications cost of a wide range of African telecommunications users. These savings would come almost exclusively from international calls. There are two reasons for this conclusion. First, at the moment, 80 to 90 percent of email are sent to and received from outside of the continent. Second, international calls from and to the continent attract revenues far in excess of the costs of completing the call.
Ironically, given the pressures on rate rebalancing which are unconnected with the Internet, it is likely that emailing will become relatively less attractive as a substitute for voice or fax as international call costs drop and local call costs increase. At the moment, however, Internet access is a profitable investment, purely from the point of view of direct savings on communications for companies that do a lot of international business. Talking to the United Kingdom for about an hour each business day over the period of a year would cost a Mozambican businessman approximately US$38,250. Faxing that same information would cost US$7,650. All of the yearly costs of a regional Internet connection - a computer, a modem, and Internet access - used for international email alone as a substitute for fax traffic, would together amount to US$1,328. The yearly savings over fax use would thus be US$6,322.
Policy conclusions
The Internet is likely to continue to revolutionize the means in which people communicate and access information. Because the Internet represents such a powerful new communication tool, the environment in which it operates must be regulated differently from traditional information and communication media. The toolkit stresses three general principles: the importance of not trying to fit the Internet into existing regulatory structures, the power of competition on Internet growth, and the necessity of allowing the Internet to flourish without the burden of unnecessary regulation. The models and data presented in the toolkit suggest a number of policy conclusions. To expand access and use of the Internet in Africa, it is necessary to provide the following:
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Low cost and reliable access to international bandwidth.
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Low cost and reliable local bandwidth connectivity.
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Countrywide reliable local cost access to ISPs.
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Low cost access to network equipment.
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Widespread public access to networked computers.
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An educated and trained user and provider base.
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Support for the development of national and African Internet content.
The policies that may help to meet these needs are:
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Liberalization of the telecommunications network.
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Liberalization of Internet service provision.
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Lowering of tariffs on computer and telecommunications equipment.
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General tariff rebalancing with possible support for local cost ISP access.
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Support for community access to the Internet.
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Support for training in the use of the Internet.
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Support for local content development.
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An Africa-wide backbone.
The Internet represents a new opportunity for increased knowledge and information for development. In the long term, it will significantly alter the structure of telecommunications. In the short term, the main policy conclusions from this toolkit are not very different from those of studies that concentrate on telecommunications in general. The Internet is heavily dependent on an efficient telecommunications sector, which is usually market-based. The Internet is itself another pressure acting toward the market option of further competition and liberalization. However, while the market forces will expand access to a section of the population, there will still remain a role for government to reach the poorest.
The Toolkit is part of a collaborative effort on expanding Internet access in Africa that began in 1995 with the creation of the Africa Internet Forum (AIF). This is a group of donors, users and other interested organizations including the UNDP, UNITAR, USAID, CIDA, NASA, the Carnegie Corporation and the African Networking Initiative - which itself includes groups such as the IDRC, ITU, ECA and UNESCO.
The Toolkit is intended to be used in policy dialogues and country assessments, broadly to facilitate the involvement of the private sector in Internet provision, and specifically to help policy makers shape their attitudes toward this exciting and expanding sector of the telecommunications business.
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Ecosystem-based farming comes of age
FAO urges broader adoption of its “Save and Grow” paradigm for sustainable agriculture
A new FAO book takes a close look at how the world’s major cereals maize, rice and wheat – which together account for an estimated 42.5 percent of human calories and 37 percent of our protein – can be grown in ways that respect and even leverage natural ecosystems.
Drawing on case studies from around the planet, the new book illustrates how the “Save and Grow” approach to agriculture advocated by FAO is already being successfully employed to produce staple grains, pointing the way to a more sustainable future for farming and offering practical guidance on how the world can pursue its new sustainable development agenda.
“International commitments to eradicate poverty and tackle climate change require a paradigm shift towards a more sustainable and inclusive agriculture able to produce higher yields over the longer term,” said FAO Director-General José Graziano da Silva.
The two recent landmark global agreements, the Sustainable Development Goals (SDGs) – which require eradicating hunger and putting terrestrial ecosystems on a sound footing by 2030 – and the Paris Climate Change Agreement (COP21), only underscore the need for inclusive innovation in food systems, he adds.
While the world’s cereal harvests may be at record levels today, their productive base is increasingly precarious amid signs of groundwater depletion, environmental pollution, loss of biodiversity and other woes marking the end of the Green Revolution model. Meanwhile, global food production will need to grow by 60 percent – mostly on existing arable land and in the face of climate change – to feed the future population in 2050, making it all the more urgent for the smallholders who grow the majority of the world’s crops to be enabled to do so more efficiently and in ways that don’t further increase humanity’s ecological debt.
Save and Grow is a broad-based approach to environmentally friendly, sustainable agriculture aimed at intensifying production, protecting and enhancing agriculture’s natural resource base and reducing reliance on chemical inputs by tapping into the Earth’s natural ecosystem processes, and to increase farmers’ gross income. As such it is an approach intrinsically crafted to contribute to the SDGs and foster resilience to climate change.
Viable Save and Grow practices range from growing shade trees that shed their leaves when adjacent maize crops most need sunlight, as tried with success in Malawi and Zambia, to scrapping tillage and leaving crop residues as soil surface mulch, a method applied on a massive scale by wheat farmers on the Kazakhstani steppe and increasingly by innovative slash-and-mulch practices adopted by farmers in the highlands of Central and South America.
The time has now come for ideas that have proven themselves in farmers’ fields to be upscaled in more ambitious national programmes, FAO Director General José Graziano da Silva says in the foreword to Save and Grow in Practice in Practice: A Guide to Sustainable Cereal Production, a book he described as ”a contribution to creating the world we want.”
Understanding Save and Grow
Save and Grow refers to an array of techniques that share the trait of trying to capitalize on natural biological and ecosystem processes to “produce more with less”.
Five complementary elements form the core of the Save and Grow paradigm: conservation agriculture, which minimizes tillage and uses mulches and crop rotation; soil health enhancement, such as growing nitrogen-fixing plants that replace costly mineral fertilizers; selection of crops with higher yield potential, greater resistance to biotic and climate stress, higher nutritional quality; efficient water management; integrated pest management, often relying on exploiting natural enemies to minimize the need for chemical pesticides.
One classic example, now widely adopted in China, is the rice-and-fish system, wherein farmers stock flooded paddy fields with fish. These can eventually be sold for income or eaten for better nutrition but while being raised also eat insects, fungi and weeds that would otherwise damage the crop, reducing the need to spend on pesticides.
A one-hectare paddy field can yield up to 750 kilograms of fish while still supporting rice yields and leading to fourfold gains in rural household income. Extra benefits include sharp drops in mosquito populations, thus reducing a serious disease vector.
FAO estimates that 90 percent of the world’s rice is planted in habitats suitable for rice-fish farming, but outside of China only one percent of Asia’s irrigated rice areas use the system. Indonesia’s government has just launched a plant to shift one million hectares to the integrated technique.
Creating habitats
The ecosystem approach at the heart of Save and Grow is exemplified in the way some smallholders in Africa have tackled the problem of an indigenous moth whose larvae devour maize at an atrocious rate. Intercropping maize with Desmodium, a leguminous plant, in fields surrounded by Napier grass, a livestock fodder crop, catalyzes a system wherein the Desmodium produces chemicals that attract predators of maize pests while also sending a false distress signal that prods egg-laying moths to seek habitats in the Napier grass, which in turn exudes a sticky substance that traps the stem borer larvae.
On top of that Desmodium – which also fixes nitrogen in the soil – appears to encourage germination of Striga, a parasitic weed that routinely devastates African farms, while at the same time impeding the weeds’ root growth. While this approach to farming entails devoting less acreage to maize than monocropping, it is far more productive, with 75 percent of farmers who adopted it around Lake Victoria reporting their net yields at least tripled. Growing more Napier grass also allows for more cows and dairy production, leading to increased supply of milk.
High tech tools
While a global shift to sustainability entails “striking a balance between the needs of both human and natural systems”, advanced technology also has a role to play in enhancing the flow of ecosystem services.
Hand-held optical sensors can determine, in real time, how much nitrogen fertilizer a plant needs. Laser-assisted precision land levelling has led to productivity gains across India while reducing water applications by as much as 40 percent compared to levelling land with traditional wooden boards.
Save and Grow is a flexible approach. As ecosystems and farm needs vary, there is ample scope for innovations related to carbon sequestration, nutrition, innovative fertilizers and new crop varieties, as well as the identification of just how seeds, animals and agricultural techniques interact.
FAO also underscores that “Save and Grow” farming systems are knowledge-intensive, and need to be built on local knowledge and needs, recognizing the important role of farmers as innovators.
Policy pointers
Smallholders who embrace such a paradigm shift often find that, while benefits are clear, they are not always immediate. For this reason, Save and Grow needs strong institutional commitment for a sustained period.
To enable the transition to sustainable crop production intensification, policy makers should create incentives for farmers to diversify – by supporting markets for rotational crops – while devising tools -crop insurance, social protection schemes and credit-easing facilities – to reduce the risk they may face in making the change. Low-till agriculture, for instance, is often hampered by inadequate access to the machinery it requires.
While there is no single blueprint for the ecosystem-based Save and Grow approach, promoting its widespread adoption requires concerted action at all levels, from governments and international organizations to civil society and the private sector.
Kazakhstan’s experience with conservation agriculture suggests the rewards warrant taking up the challenge on a grand scale. Initially used as a battle against wind-driven soil erosion back in the 1960s, FAO began in 2000 helping upscale the no-plough approach, which helps keep melted snow and rain water in the soil and led to 25 percent higher wheat yields and lower labor and fuel costs. In 2011, the government introduced substantial targeted subsidies to promote adoption of the practice, and today, half of the country’s 19 million hectares of crop land are under full conservation agriculture.
» Download: Save and Grow in practice: Maize, rice, wheat – A guide to sustainable cereal production (PDF, 9.15 MB)
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Africa currency crises spark diverging Central Bank stances
Africa’s biggest economies are taking opposite approaches on monetary policy as they struggle to cope with collapsing commodity prices and a slump in investor confidence.
South Africa, Nigeria, Angola and Ghana are set to announce their first interest-rate decisions of the year this week in an environment complicated by plummeting currencies, rising inflation risks and deteriorating growth. While a record-low rand may force South African policy makers to take more aggressive action, Nigeria is set to stick to its looser policy, according to analysts surveyed by Bloomberg.
The contrasting approaches underscore the difficult policy choices African central banks are being forced to take as their currencies suffer the worst of the rout in global financial markets. In Nigeria, the continent’s biggest economy, growth concerns and naira stability have trumped inflation risks, while fiscal pressures in Ghana and an oil-triggered crisis in Angola have fueled weaker currencies and prompted higher interest rates.
“A further decline in commodity prices, tightening of monetary policy by the U.S. Federal Reserve, and unfavorable weather conditions mean that the short-term outlook for African currencies is weak,” Jacques Verreynne, an economist at NKC African Economics, based in Paarl, near Cape Town, said in an e-mailed response to questions.
“Although the outlook for economic growth is fairly weak in many parts of the continent, there is pressure on central banks to raise interest rates in order to anchor inflation expectations,” he said.
Naira Risks
The Bank of Ghana is set to kick off the week’s policy decisions by keeping its benchmark interest rate unchanged at 26 percent on Monday after three increases last year, according to seven of the 10 economists surveyed by Bloomberg. Kenya’s central bank also opted last week to extend the pause in its interest-rate cycle by leaving the policy rate at 11.5 percent.
In Nigeria, pressure is mounting on Governor Godwin Emefiele to devalue the naira and ease foreign-currency controls that are hurting businesses and worsening the outlook for growth in Africa’s biggest oil producer.
He surprised market analysts at the last Monetary Policy Committee meeting in November by cutting the benchmark rate by 2 percentage points to 11 percent and snubbing calls to weaken the currency.
All but one of the 22 economists surveyed by Bloomberg predict Emefiele will leave the key rate unchanged on Tuesday, with some predicting an adjustment to the naira rate.
Inflation Risks
“The concerns are that the currency is under pressure, that the currency is misaligned,” Bismarck Rewane, chief executive officer at Financial Derivatives Co. Ltd., said by phone from Lagos, Nigeria’s commercial capital. “Ghana and South Africa have already moved closer to an equilibrium. Nigeria has not really accepted that the currency price is in disequilibrium.”
While the Central Bank of Nigeria has virtually fixed the naira at 197-199 per dollar since March, South Africa’s rand has plunged about 29 percent and Ghana’s cedi is down almost 8 percent in the same period. Authorities in Angola, sub-Saharan Africa’s biggest oil producer after Nigeria, have gradually devalued the kwanza since last year.
The rand’s slide to a record-low of 17.9169 per dollar on Jan. 11 is adding to pressure on inflation in South Africa at the same time that the worst drought in more than a century boosts food costs. Inflation accelerated to 5.2 percent in December and is set to exceed the central bank’s 3 percent to 6 percent target band this year. The rand gained 0.2 percent to 16.4389 by 8:57 a.m. in Johannesburg.
That may prompt the Reserve Bank to increase the magnitude of its rate increases from 25 basis points. While most of the 23 economists surveyed by Bloomberg predict higher rates this week, 16 forecast the repurchase rate of 6.25 percent will be lifted by at least 50 basis points.
Economic Stability
The MPC decision is the first since the U.S. Federal Reserve raised interest rates in December and President Jacob Zuma shocked financial markets by changing his finance minister three times in the space of five days, triggering a weaker rand.
Governor Lesetja Kganyago said in an interview on Jan. 20 that it’s impossible to avoid the trade-off between growth and inflation and the central bank will “act with resolve” if price pressures stemming from a weaker rand spread more broadly in the economy.
“There’s still room for African central banks to tighten monetary policy,” Courage Kingsley Martey, an economist at Databank Group Ltd., said by phone from the Ghanaian capital, Accra. “It is possible to sacrifice growth for some time and then allow macroeconomic stability to return, else inflation will return to haunt growth.”
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Crashing commodities are saving China $460 billion a year
The pain from the rout in global commodity prices is sweeping through nations from Brazil to South Africa. The biggest beneficiary? Arguably it’s China, the nation often blamed for driving prices lower due to its slowing economic growth.
China’s annual savings from the commodities rout amount to $460 billion, according to calculations by Kenneth Courtis, former Asia vice chairman at Goldman Sachs Group Inc. About $320 billion of that is from cheaper oil, with the rest from other energy, metals, coal and agricultural commodities.
Benefits are rippling through the economy, pushing down or steadying prices of everything from home heating and petrol prices to the cost of raw materials at factories. That’s also boosting China’s efforts to recalibrate its economic growth model away from a reliance on heavy industries and investment toward consumption and services.
“It’s shown up in low consumer-price inflation and more stuff that households have been able to buy,” said Louis Kuijs, the head of Asia economics at Oxford Economics Ltd. in Hong Kong and a former World Bank economist in Beijing. “Manufacturing companies would have had even worse profit developments if it had not been for those low commodity prices.”
China saved $188 billion in import costs last year on a basket of 10 commodities ranging from oil to soybeans and natural gas, the Ministry of Commerce said in a statement this month. “That significantly cut the costs of domestic companies and improved efficiency,” the ministry’s spokesman said.
By helping damp inflation, the commodities price slump also has given China’s policy makers more room to ease monetary policy to support economic growth, which slowed to a 25-year low in 2015. A lower import bill also helped the nation’s trade surplus surge to $594.5 billion last year, helping mitigate capital outflows that have pressured the yuan.
China is capitalizing on the lower prices, importing a record amount of crude last year as oil’s lowest annual average price in more than a decade spurred stockpiling and boosted demand from independent refiners. The country had record imports of iron ore, soybeans and copper concentrate last year.
“China is the great winner from the crash of commodity prices,” said Courtis, now chairman of Starfort Holdings. “A significant portion of that windfall gain is being transferred to the domestic population.”
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Rwanda aims to be EA’s logistics hub
Dubai Port World plans to construct a $40 million inland container depot on a 30-hectare plot of land in Masaka, a suburb east of Kigali city, as Rwanda seeks to become a regional trade logistics centre.
Dubai Port World has been granted a 25-year concession to finance, develop and manage the facility, which will provide warehousing, truck parking, a container yard and other auxiliary services.
According to Dubai Port, the first phase of the Inland Container Depot, at the Kigali Logistics Platform, is set to be complete in 18 months’ time, raising hopes that it will contribute to the ease of doing business in the country.
When completed, analysts are optimistic the dry port, which is linked to both the Northern and Central Corridors, will allow Rwandan importers and exporters to consolidate volumes of cargo.
“There are cases where offloading containers takes almost a whole week, forcing truckers to make only two trips per month. But with the new infrastructure, the trucks will do as many as five trips per month. This will reduce transport costs and increase profit for businesses,” said Minister of Trade and Industries Francois Kanimba.
Truck drivers complain about the long waiting time when in Rwanda, despite the implementation of the East African Community Single Customs Territory resulting in a seamless flow of goods within the region.
“There are times we wait for more than 20 hours before being allowed into the city, which adds to operational costs. For instance trucks are only allowed into Kigali to pick up or drop off containers at night,” said Robert Kyembula, a long distance truck driver.
Traffic jams
To avoid traffic jams within the Kigali Central Business District, city authorities only allow cargo trucks into the city between 9pm and 5am.
There are hopes that when completed, the Inland Container Depot will boost the country’s manufacturing sector.
The underdeveloped logistics industry is not only a challenge in Rwanda but in many other sub-Saharan African countries as well.
The only promising market in the East African Community is Kenya, according to the 2016 Agility Emerging Markets Logistics Index. The survey points out that poor infrastructure, lack of power generation coupled with corruption pose the most risk to African economies.
Over 43 per cent of the more than 1,000 executives surveyed said they have no plans to set up industries in Africa.
“The results show a serious disconnect between the perception of the market and actual opportunities. Africa’s requirement for logistics services and supply chain expertise is huge and growing every day.
At the same time, many of the companies that need logistics to enter the market don’t know how to get started in Africa or aren’t willing to take the risk,” said Geoffrey White, CEO of Agility Africa.
“The opportunities are there for those seeking to build long-term, sustainable businesses that bring in world-class practices and adapt to local conditions,” he added.
Hannington Namara, TradeMark East Africa country director, is optimistic that the platform will boost intra-regional trade.
“The Kigali Logistics Platform will be the first of its kind, a logistics hub developed under a private-public partnership, and will help provide the economies of scale required to reduce costs not just for Rwanda but also for Burundi, eastern DR Congo and possibly parts of Uganda.
“The confidence shown by DP World, which operates over 65 terminals across the world and has over 36,000 employees, in investing in Rwanda reflects the confidence being shown by investors in our country,” said Mr Namara.
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tralac’s Daily News selection
The selection: Friday, 22 January 2016
Next week's African trade and development policy debates: Tripartite Private Sector Dialogue on Rules of Origin (28-29 January), East African Legislative Assembly plenary (24 January - 5 February)
Four trade and development infographics:
Competitiveness Index: Africa profiles for tech, innovation and financial development (Quartz)
GED Fact Sheets for 26 African countries: how do mega-regional trade deals like the TTIP and TPP affect your country? (Bertelsmann Stiftung)
Great fall of India’s exports (Livemint)
EU/US/JP/China imports from SS Africa falling rapidly; less for manufacturing than for other goods (@DWteVelde)
Three new UNU-WIDER working papers:
Demographic, employment, and wage trends in South Africa
This paper looks to uncover the growth traps and opportunities for the South African economy, with a focus on underlying labour market dynamics. We explore the potential of South Africa’s demographic dividend. We also consider the structure of the labour market and the growth-employment interactions, which uncover the skills-biased labour demand path of the economy and a rising trend in the use of labour brokers to source temporary workers. Finally, we show a new labour market trend has emerged: a rise in the share of public sector employment along with higher conditional returns to public sector workers than to those in the private sector.
Estimating utility-consistent poverty in Madagascar, 2001–10
Estimating utility-consistent poverty in Ethiopia, 2000–11
Factory Southern Africa? SACU in global value chains (World Bank)
The World Bank report has three core recommendations in order to promote SACU as a gateway for global value chain development in Southern Africa:
Promotion of regional economic densification: This recommendation boils down to trade facilitation measures that need to be improved drastically in the region in order to bring markets and people closer to one another by decreasing cost and time associated with trade. The focus is on transport infrastructure, trade policy harmonisation, liberalising the movement of labour and the promotion of special economic zones.
Skills, services and infrastructure competitiveness: This recommendation focuses on improving the productivity of the Southern African labour force by focusing on technical and management skills, improving cross-border services trade and improving the reliability of electricity and the quality and affordability of ICT infrastructure.
Promoting open regionalism and institutional co-ordination: The report firmly recommends close co-operation on policy efforts between institutions at the regional level. [Download]
Namibia: Is local barley not good enough? (Namibia Economist)
Africa’s growth dividend? Lived poverty drops across much of the continent (Afrobarometer)
Though Africa has recorded high levels of economic growth over the past decade, previous Afrobarometer surveys of citizens found little evidence that this growth had reduced levels of poverty in any consistent way. However, new data from Afrobarometer Round 6, collected across 35 African countries, suggest a very different picture. While “lived poverty” remains pervasive across much of the continent, especially in Central and West Africa, we now see evidence that the decade of economic growth seems to have finally delivered broad-based reductions in poverty.
“Lived poverty” (an index that measures the frequency with which people experience shortages of basic necessities) retreated across a broad range of countries. In the roughly three-year period between Round 5 (2011/2013) and Round 6 (2014/2015) surveys, our data suggest that “lived poverty” fell in 22 of 33 countries surveyed in both rounds. However, these changes show no systematic relation to recent rates of economic growth. While growing economies are undoubtedly important, what appears to be more important in improving the lives of ordinary people is the extent to which national governments and their donor partners put in place the type of development infrastructure that enables people to build better lives. [Download]
Central Africa's ICE session: agriculture, structural transformation to dominate experts’ session (UNECA)
From 24-26 February in Douala, Cameroon’s economic capital, experts from Central African States as well as those from international organisations, will deliberate on where countries of the sub-region should put their energies to leverage their agricultural potential in order to give new impetus to the sector’s value chain and effectively contribute to structural transformation. The 32nd ICE session of Central Africa will be held back-to-back with an Ad Hoc Expert Group meeting billed for 22 to 23 February 2016 to review a report prepared by ECA on the theme: “Promoting intra-regional trade in Central Africa with the aid of Information and Communication Technologies.”
Jacob Zuma at Davos: ‘Africa needs African solutions’ (IOL)
The global economic crisis and major advances in technology should be tackled head-on by a cohesive African response, driven by the African Union, says President Jacob Zuma. Zuma intends using the 26th AU Summit to strongly lobby for a self-reliant continent unshackled from its colonialist links. With regards to the WEF theme - the Fourth Industrial Revolution - Zuma questioned if any real solutions had come out of last year’s gathering. He questioned if constructs like the World Economic Forum held any real quantifiable value for the continent. “We had a theme last year on the growing gap between rich and poor. Twelve months later and now we are doing something else. Why are we not talking and dealing with this widening gap and the inequality that exists?” [Text, as prepared]
Two profiled international policy processes announced at Davos:
High-Level Panel on Women’s Economic Empowerment (UN)
The Panel will provide recommendations for the implementation of the 2030 Agenda for Sustainable Development to improve economic outcomes for women and promote women’s leadership in driving sustainable and inclusive, environmentally sensitive economic growth. It will provide recommendations for key actions that can be taken by governments, the private sector, the UN system and other stakeholders, as well as policy directives needed to achieve the new targets and indicators in the Sustainable Development Goals which call for the economic empowerment of women. The panel is backed by the United Kingdom, the World Bank Group and UN Women.
Global Commission on Business and Sustainable Development (Economic Times)
The Global Commission on Business and Sustainable Development, created by former UN Deputy Secretary General Mark Malloch-Brown and Unilever CEO Paul Polman, brings together international leaders from business, labour, financial institutions and civil society. "They will present a comprehensive report in one year's time, outlining new business and financial models, as well as market opportunities for companies who are invested in sustainable approaches," a statement said.
Witney Schneidman: ‘An end to the never-ending South African poultry dispute?’ (Brookings)
A positive outcome to this trade dispute would create welcome momentum in U.S.-South African trade relations. As South Africa assesses its relationship with China and the other BRICS, a successful resolution to the poultry dispute would be a useful reminder of the value that both sides attach to their commercial partnership. It could also create the context for dealing with other thorny issues about which the US is concerned, including the Private Security Bill, which would require 51% local ownership of international security firms, and the erosion of U.S. export competitiveness due to the Economic Partnerships Agreement between the Southern Africa Development Community, of which South Africa is a member, and the European Union.
Botswana: Local AGOA textile exports drop 11% (Mmegi)
Nigeria: NEPC identifies 13 national strategic export products to replace oil (The Eagle)
Olusegun Awolowo, the Executive Director of Nigerian Export Promotion Council, has identified 13 National Strategic Export Products targeted at replacing crude oil. Awolowo told the News Agency of Nigeria in Abuja on Tuesday that the NSEPs were also to shore up the country’s foreign exchange earnings. He said the products were grouped into three categories: agro industrial, mining related products and oil and gas industrial products.
Related: Nigeria to increase budget gap as oil falls below benchmark (Bloomberg), Africa, a vital region for sourcing petroleum products for India (NetIndian)
Kenya's Blue Economy: calling the bluff and swimming with the sharks (CapitalFM)
With the creation of a Maritime Affairs Department under the Ministry of Transport and Infrastructure, and the nomination of Ms. Nancy Karigithu as the PS, a trail-blazer who has spent her entire working life on maritime issues, I have no doubt that with the requisite support, we will move to execution of our maritime integrated plan and unlock value for all of us. This is the bigger picture that our leaders need to align their words, actions and vision to.
Benguela Current Commission update (The Namibian)
The overarching objective of the Benguela Current Spatial Management and Governance (MARISMA) project is to ensure the sustainable use of marine life of the BCLME and biological resources is strengthened by improving the capacities of the Benguela Current Commission and its member states in relation to Ecologically Significant Areas and Marine Spatial Planing, said the project's regional technical adviser, Rod Braby. He said the BCLME is very important to the economies of the three SADC countries. The BCC is a multi-sectoral initiative between Namibia, Angola and South Africa, aimed at promoting integrated and sustainable use of the BCLME, and was recently established. Braby further explained that an amount of 8,9 million euros has been pumped into the project, which will last until April 2020.
On the road to middle class: a look back and a look ahead for Ghana (World Bank Blogs)
As our report warns, however, future efforts to lower the incidence of poverty in Ghana will require containing regional disparities and vulnerabilities, as well as broadening access to opportunities for all citizens, particularly those in the north. Indeed, location has been found to be a major contributor to poverty in Ghana. Case in point – the rising income inequality between north and south is a striking demonstration of diverging employment opportunities across the regions. While poverty rates have fallen below 20% in the large area that spans Ashanti, eastern, Greater Accra and western regions, southern Brong Ahafo and coastal Volta regions, rates remain far above 40% in most northern districts.
China, Egypt sign MoU on boosting cooperation under Belt and Road Initiative (China Daily)
The Portuguese-speaking world needs a Development Bank - academic (Club of Mozambique)
SA, Liberia keen to boost trade ties (IOL)
Egypt’s tourism receipts down 15% in 2015 on back of security, currency woes (Ahram)
The incidence of fiscal policy in Tanzania (Commitment to Equality)
Urban resilience: challenges and opportunities for African cities (World Bank)
What are the 10 biggest global challenges? (WEF)
Virtual currencies and beyond: initial considerations (IMF)
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Strengthening the Global Trade and Investment System in the 21st Century: E15 Policy Options
Experts launch bid to strenghten global trade at Davos
The World Economic Forum and International Centre for Trade and Sustainable Development on Thursday, 21 January 2016 released a sweeping set of proposed reforms to international trade and investment rules and institutions.
The new report outlines a pathway for better aligning and eventually reintegrating the world’s “spaghetti bowl” of regional free trade and investment agreements, as well as for adapting rules and institutions to recent changes in the world economy, such as global value chains, the digital economy, services, climate change, Sustainable Development Goals, etc.
The report of the E15 Initiative, Strengthening the Global Trade and Investment System in the 21st Century, takes a long-term, systemic perspective. It makes proposals for the evolution of not only trade law and institutions but also trade-related aspects of international development, financial, environmental, agricultural, labour and technological cooperation over the next decade to 2025. The report also proposes a series of structural improvements to the World Trade Organization (WTO).
The new proposals come on the heels of the WTO ministerial in Nairobi in December 2015, where governments failed to reach agreement on a continuation of the Doha Round of trade negotiations in its current configuration, effectively suspending a process that had been deadlocked for over a decade. That outcome has left the international community without a shared vision and with growing concerns about a system that is fragmenting and facing fundamental questions of legitimacy and effectiveness.
For over two years, the World Economic Forum and the International Centre for Trade and Sustainable Development facilitated an extraordinary multistakeholder and multidisciplinary process that engaged 375 experts from around the world in 15 Expert Groups and three cross-cutting Task Forces, in partnership with 16 other institutions. The process has yielded a comprehensive set of proposals that have been summarized in a synthesis report prepared by the two convening organizations and detailed in accompanying thematic papers.
Richard Samans, Member of the Managing Board, World Economic Forum, said: “The E15 findings and recommendations are encouraging. They demonstrate that just because the world was not able to agree to the particular multilateral agenda on the table in the Doha Round does not mean that a common undertaking that leaves every major constituency and region better off is not possible. But the path forward only comes into view if one steps back from a specific focus on the formal trade policy machinery of the WTO and appreciates the much wider ecosystem of institutions and instruments available to influence trade and investment behaviour in a positive direction.”
Ricardo Meléndez-Ortiz, Chief Executive Officer of the International Centre for Trade and Sustainable Development, said: “The E15 proposals respond to changes in the global trade and investment system and provide concrete principles and measures to ensure that governance in this area advances sustainable development.”
The E15 Initiative proposals include sets of measures that would support progress on many of the international community’s paramount shared priorities, including:
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Boosting global growth and employment
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Reducing commercial friction and investment uncertainty
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Accelerating sustainable development in least-developed countries
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Increasing economic diversification and competitiveness in middle-income countries
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Ensuring food security
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Combating climate change and environmental degradation
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Preserving national policy space to make societal choices
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Strengthening the legitimacy of the global trading system
Details are summarized in the Synthesis Report Executive Summary. Experts Groups and Task Forces were convened in the areas of: Agriculture and Food Security; Clean Energy and Technologies; Climate Change; Competition Policy; Digital Economy; Extractive Industries; Finance and Development; Fisheries and Oceans; Functioning of the WTO; Global Value Chains; Reinvigorating Manufacturing; Innovation; Investment Policy; Regional and Plurilateral Agreements; Regulatory System Coherence; Services; and Subsidies.
» A selection of the thematic Policy Options Papers is available below.
The process will continue in 2016-2017 in a worldwide dialogue on the implications of this blueprint on how trade strategy is set and administered in countries, as well as globally, including how improvements in international cooperative architecture could help.
E15 Knowledge Partners include the International Food and Agricultural Trade Policy Council (IPC); the Inter-American Development Bank (IADB); the World Trade Institute (WTI); the Evian Group@IMD; Chatham House; the Friedrich Ebert Foundation (FES); Sweden’s National Board of Trade; the National School of Development, Peking University; International Institute for Sustainable Development (IISD); Climate Strategies; the Graduate Institute, Geneva; Bruegel; the European University Institute; Center for International Development at Harvard University; and the Southern Voice on Post-MDG International Development Goals.
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New Report: Factory Southern Africa? SACU in Global Value Chains
On Thursday, 21 January 2016 SAIIA hosted the launch of the World Bank publication, ‘Factory Southern Africa? SACU in Global Value Chains’. The publication is the result of an extensive collaborative effort across many organisations and experts that have contributed within their fields of expertise.
Regional, global value chains could create more, better jobs for southern African countries
If South Africa and its neighbors could take advantage of their collective capabilities to build competitive regional value chains that could feed into global value chains, it could spark economic growth, create high-quality jobs, and reduce poverty, according to a new World Bank study.
The report, Factory Southern Africa? SACU in Global Value Chains, analyzes the emergence of global value chains (GVCs) and assesses their potential for South Africa to improve exports, productivity and job creation. The report also focuses on opportunities for southern African countries to establish competitive regional value chains (RVCs), and the requirements to take advantage of this opportunity.
“We see from this study that the region could attract more investment and increase jobs not only in industry and agribusiness, but also in high value services sectors such as transport and logistics, infrastructure services, finance, and professional services, if it were to take advantage of its collective capabilities to compete globally,” said Guang Zhe Chen, World Bank country director for South Africa, Botswana, Lesotho, Namibia, Swaziland, Zambia and Zimbabwe.
Highlighting the success of other regions that have benefitted from GVCs, the report notes that members of the Southern Africa Customs Union (SACU) – South Africa, Botswana, Lesotho, Namibia and Swaziland – are poised to compete for foreign direct investment arising from the migration of parts GVCs in East Asia. The report notes that the SACU countries collectively have strong complementarities in of the mix of capabilities required to compete in such GVCs, including transport logistics, contracting institutions, skills, financial capital, and market access.
Taking advantage of the opportunity to develop GVCs may require developing an integrated, regional production network in Southern Africa, similar to the experience in East Asia, Central Europe, and the Americas, the report says. The realization of value addition within the region depends on combining South Africa’s globally competitive and technologically sophisticated enterprises with foreign investors, supported by effective regional integration, according to the report.
The report recommends a “Factory Southern Africa” that hinges not simply around industrial production, but around a highly competitive, facilitative network of services,to be built with South Africa as a gateway to global value chains. Its components would be sectors such as transport infrastructure and advanced producer services, such as banking and consultancy, which would enable domestic and multinational corporations (MNCs) to coordinate their regional networks.
“The region should focus on promoting gateway integration and open regionalism as a way forward in SACU, coordinating regional investment promotion, strengthening regional competition policy, and supporting public-private dialogue across regional supply chains,” said Thomas Farole, World Bank lead economist and author of the report.
The report also notes that the largest gains from deeper GVC integration would come from higher productivity and job creation. An assessment of 25,000 manufacturing firms in 78 developing economies showed a clear link between GVC participation and higher labor productivity. In South Africa and the region, the productivity gains from access to quality imported inputs are exceptionally strong, the report says.
In terms of job creation, a case analysis of South Africa’s automotive sector shows that while labor intensity declined with GVC participation, growth resulting from integration meant that overall jobs expanded substantially. Jobs growth, however, did not come in manufacturing or even in the automotive sector directly, but primarily through indirect jobs linked to the automotive value chain – mostly in higher-skilled services jobs.
The study also outlines a three-plank framework for supporting the emergence of “Factory Southern Africa.” This involves facilitating regional economic densification, developing skills, services, and infrastructure for competitiveness, and promoting open regionalism and institutional coordination.
Beyond supporting gateway strategies, the report also recommends policies to strengthen value chain positioning. Noting that value chain participation is not the end game, the report suggests that success also depends on establishing an environment where firms are able to upgrade to higher value-added positioning in the chains. This will ensure greater returns to workers and support the sustainability of value chains.
Background
Topics in the report range from the theory of global value chains, level of integration, trade facilitation, trade and investment policy, services, labour and more. These background papers have been drawn into a Summary Report, which is an in depth analysis on understanding how and why Southern African states should and could promote global and regional value chain development in the region.
What are value chains and how do they work?
Previously states have industrialised by focusing on production and consumption at the national level – the sourcing of raw materials and production of manufactured goods was done within the nation state and then the product was sold locally or exported to external markets. However, with an increasingly connected world and the ability to move products and people as well as information rapidly across the globe, there has been a dramatic increase in specialisation of activities and a fragmentation of the manufacturing chain across countries if not continents.
Large corporations typically source competitive inputs from across the globe in order to produce at the lowest and most efficient point without compromising the quality of the output. For China and large part of East Asia, participation in global value chains became the basis from which their economies grew at double-digit levels and poverty levels came down. This would suggest that Southern Africa could pursue integration into value chains in order to replicate the successes of the East.
Obstacles in Southern Africa
Southern Africa, however, is only weakly linked into global value chains (excepting South Africa’s participation in the automotive chains and Lesotho’s participation in the apparel chain). The question remains as to whether certain policy choices could open the door for such participation – and whether participation in value chains is even desirable.
Another question is whether Southern Africa can develop its capacity to move up the ladder of value within the value chain. Traditionally, Southern Africa inputs at the lowest level, close to commodity extraction, rather than at the higher, more lucrative, end. With China upgrading to higher input levels, it is estimated that 80 million jobs could shift to Africa, but which countries in Southern Africa could capitalise on this opportunity, given high labour costs.
Southern Africa’s weak participation in global value chains is partly due to its geographical remoteness from world markets and the lack of modern infrastructure that could bring trading costs down. Another challenge is the relatively small size of the population, estimated to be 30 times smaller than in East Asia. This results in a small but expensive labour force with a small market to sell to. These challenges are hard to change. However, policy makers could focus on the less binding constraints of the region’s trade and trade facilitation environments. Addressing tariff and non-tariff barriers to trade within the region, could go a long way towards addressing the cost of doing trade and attracting more investment to the region.
Opportunities for Southern Africa: Productivity and Jobs
The report argues that participation within global value chains exposes countries to globally-leading technologies and business practices, resulting in significant long-term productivity gains. These gains should allow countries to move higher up the value-chains – as China is now doing – but also have spill-over effects in terms of stimulating the rest of the economy. This means more and better jobs.
Analysis done shows that South Africa’s participation in the automotive value chain has resulted in three indirect jobs for each direct job, created predominantly in the services sector. The report further argues that the SACU region is well placed to become a gateway into the rest of Southern Africa and that services – such as like transport, producer services, banking, consultancy services and logistical services – should form part of the development of a gateway.
Recommendations
The World Bank report has three core recommendations in order to promote SACU as a gateway for global value chain development in Southern Africa:
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Promotion of regional economic densification: This recommendation boils down to trade facilitation measures that need to be improved drastically in the region in order to bring markets and people closer to one another by decreasing cost and time associated with trade. The focus is on transport infrastructure, trade policy harmonisation, liberalising the movement of labour and the promotion of special economic zones.
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Skills, services and infrastructure competitiveness: This recommendation focuses on improving the productivity of the Southern African labour force by focusing on technical and management skills, improving cross-border services trade and improving the reliability of electricity and the quality and affordability of ICT infrastructure.
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Promoting open regionalism and institutional co-ordination: The report firmly recommends close co-operation on policy efforts between institutions at the regional level.
Talitha Bertelsmann-Scott heads the Economic Diplomacy Programme at SAIIA.
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What are the 10 biggest global challenges?
Whether it’s turning promises on climate change into action, rebuilding trust in the financial system, or connecting the world to the internet, the World Economic Forum has singled out 10 key global challenges that, if they are to be addressed, require cooperation from the public and private sectors.
Here is a guide to the 10 challenges, and why they matter to the world.
By 2050, the world must feed 9 billion people. Yet the demand for food will be 60% greater than it is today.
The United Nations has set ending hunger, achieving food security and improved nutrition, and promoting sustainable agriculture as the second of its 17 Sustainable Development Goals (SDGs) for the year 2030.
To achieve these objectives we will need to address a host of issues, from gender parity and ageing populations to skills development and global warming.
Agriculture sectors will have to become more productive by adopting efficient business models and forging public-private partnerships. And they need to become sustainable by reducing greenhouse gas emissions, water use and waste.
The risks if we fail? Malnutrition, hunger and even conflict.
The push for economic growth in recent decades has led to substantial increases in wealth for large numbers of people across the globe. But despite huge gains in global economic output, there is evidence that our current social, political and economic systems are exacerbating inequalities, rather than reducing them.
A growing body of research also suggests that rising income inequality is the cause of economic and social ills, ranging from low consumption to social and political unrest, and is damaging to our future economic well-being.
In order to boost growth and counter the slowdown in emerging markets, we need to step up efforts around the world to accelerate economic activity and to ensure that its benefits reach everybody in society.
The scale of the employment challenge is vast. The International Labour Organization estimates that more than 61 million jobs have been lost since the start of the global economic crisis in 2008, leaving more than 200 million people unemployed globally.
Nearly 500 million new jobs will need to be created by 2020 to provide opportunities to those currently unemployed and to the young people who are projected to join the workforce over the next few years.
At the same time, many industries are facing difficulty hiring qualified staff. One 2015 survey found that, globally, 38% of all employers are reporting difficulty filling jobs, a two-percentage point rise from 2014.
Put simply, we need jobs for the hundreds of millions of unemployed people around the world, and we need the skilled employees that businesses are struggling to find.
The Earth’s average land temperature has warmed nearly 1°C in the past 50 years as a result of human activity, global greenhouse gas emissions have grown by nearly 80% since 1970, and atmospheric concentrations of the major greenhouse gases are at their highest level in 800,000 years.
We're already seeing and feeling the impacts of climate change with weather events such as droughts and storms becoming more frequent and intense, and changing rainfall patterns. Insurers estimate that since the 1980s weather-related economic loss events have tripled.
Policy-makers have been advised by the Intergovernmental Panel on Climate Change that there is a high risk of catastrophic climate change if warming is not limited to 2°C.
The historic agreement reached in Paris in December 2015 outlines a global commitment to keep warming to 2°C and to strive to limit global temperature rise to 1.5°C.
Under the agreement, every country will implement its own climate action plan that will be reviewed in 2018 and then every five years to ratchet up ambition levels. Wealthier countries also committed to deliver significant flows of money and technical support to help poor countries cope with curbing their greenhouse gas emissions and adapt to climate change.
The world has agreed what is to be done. Now it is time for implementation.
The global financial crisis revealed significant weaknesses in the financial system and some of the vulnerabilities that can result from having such an interconnected global market.
Several years after the crisis, the world economy is still struggling with slow growth, unconventional monetary policy in major economies, and constrained government budgets. It is vital that we find ways of making the financial system more resilient and able to withstand shocks in the market.
The crisis also caused a significant drop in levels of public trust and confidence in financial institutions. To function efficiently, the system needs to re-establish that trust.
Providing access to credit and savings is a major challenge in the battle against global poverty – yet 2 billion people do not have access to high-quality, affordable financial services. Additionally, there are 200 million small and medium-sized enterprises worldwide that have no access to formal financial services.
The challenge is to create a resilient, accessible financial system that people trust.
The internet is changing the way we live, work, produce and consume. With such extensive reach, digital technologies cannot help but disrupt many of our existing models of business and government.
We are entering the age of the Fourth Industrial Revolution, a technological transformation driven by a ubiquitous and mobile internet. The challenge is to manage this seismic change in a way that promotes the long-term health and stability of the internet.
Within the next decade, it is expected that more than a trillion sensors will be connected to the internet.
By 2025, 10% of people are expected to be wearing clothes connected to the internet and the first implantable mobile phone is expected to be sold.
If almost everything is connected, it will transform how we do business and help us manage resources more efficiently and sustainably.
But how will this affect our personal privacy, data security and our personal relationships? Today, 43% of the world’s population are connected to the internet, mostly in developed countries. How will we achieve the United Nations’ goal of connecting all the world’s inhabitants to affordable internet by 2020?
Achieving gender equality isn't just a moral issue – it makes economic sense. Equality between men and women in all aspects of life, from access to health and education to political power and earning potential, is fundamental to whether and how societies thrive.
Although we are getting closer to gender parity, change isn't happening fast enough. For the past decade, the World Economic Forum been measuring the pace of change through the Global Gender Gap Report, and at current rates, it would take the world another 118 years – or until 2133 – to close the economic gap entirely.
There has been a significant increase in awareness of the importance of gender parity and much has been done by international organizations, civil society, governments and business.
However, often the work centres on single-issue awareness-raising campaigns. Existing work also frequently involves either cooperation between different public bodies or different private bodies.
More needs to be done to bridge the gap and facilitate cooperation between the public and private sectors.
International trade and investment are vital drivers of economic growth. With the size and shape of the world economy changing dramatically in recent years, traditional patterns of trading and investing have had to rapidly evolve alongside it. The challenge is to ensure that the regulatory framework keeps up.
There have been so many changes in the way we do business. The growth of the digital economy, the rise of the service sector and the spread of international production networks have all been game-changers for international trade.
As well as this, foreign direct investment has become a key element of trade between different countries. Rather than simply trading with international partners, more and more companies are buying controlling stakes in foreign enterprises.
Despite fundamental changes in the way business is done across borders, international regulations and agreements have not evolved at the same speed. In addition, negotiations to reach a new global trade agreement have stalled.
While there have been a string of bilateral deals struck between countries and regions, there is a pressing need to reform the global trade framework. We also need to address the growing unease over globalization, which is evident from the number of questions being asked about the power of corporations and the adequacy of the regulations governing employment, environmental issues and taxation.
Investing for the long term is vital for economic growth and social well-being. Whether it’s building new infrastructure or maintaining what already exists, funding is vital to maximize the economic benefits that flow from it.
But seven years after the global financial crisis, the world is still facing sluggish economic growth and constrained government budgets. As a result, there is an overall lack of long-term investment, which has serious implications for global growth.
The challenge is to find ways of funding the basic systems and services that countries need to function in a difficult financial climate.
Over the past few decades, the world has seen major advancements in health and largely as a result, people are generally living longer, healthier lives. However, serious challenges to global health remain, ranging from dealing with pandemics to the rise of noncommunicable diseases (NCDs) to the prohibitive costs of care, particularly in developing countries.
The number of people on the planet is set to rise to 9.7 billion in 2050 with 2 billion aged over 60.
The global health system will need to adjust to this massive population growth, which will be concentrated in the poorest countries, and increasing numbers of elderly. This will mean shifting the current focus on treating sick people towards preventing illness and preserving the health of populations.
To cope with this huge demographic shift and build a global healthcare system that is fit for the future, the world needs to address these challenges now.
The 2016 World Economic Forum Annual Meeting took place in Davos from 20-23 January, under the theme “Mastering the Fourth Industrial Revolution”.
Rosamond Hutt is a Senior Producer at Formative Content.