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LDC proposal on rules of origin triggers mixed reactions
An informal open-ended consultation on preferential rules of origin for LDCs held on 20 October reportedly examined a formal proposal on the subject from the LDC Group, in the context of the overall Nairobi ministerial.
The proposal which aims at operationalising the 2013 WTO Bali ministerial decision on rules of origin is part of a the overall LDC package which contains other elements related to duty-free quota-free (DFQF) market access, the operationalisation of the services waiver as well as cotton issues.
The LDC Group submitted a communication on 24 September in which they called for transforming the Bali guidelines on preferential rules of origin into compulsory criteria. The communication also specifies various methodologies in order for WTO members to frame their legislation on preferential RoO accordingly.
Rules of origin specify how much processing must take place locally before goods can be considered to be the product of the exporting country. They are often considered to be overly restrictive and inflexible, making it difficult for LDCs to take full advantage of the preferences they are granted.
Currently, these rules are designed on a unilateral basis without any harmonised standard, which critics say creates additional problems for the WTO’s poorest members, forcing them to adapt to a range of rules depending on the intended export market.
According to sources, Bangladesh, on behalf of the LDC Group, reiterated that rules of origin were an integral part of the request on DFQF market access and that the proposal in its current construct reflects existing best practices and constraints facing LDCs in benefitting from preferential schemes.
Some countries expressed concerns that the LDC Group proposal went beyond the Bali decision or would require substantial changes in their national system which they were not in a position to offer at this stage. Other countries felt concerned by the push to obtain legally binding obligations as articulated in the LDC proposal.
Sources indicate that several WTO members encourages the LDC Group to set a “realistic level of ambition” by focusing on a few achievable items especially given the limited time before the WTO Ministerial Conference take place in December.
Some developing countries members reminded that the Bali decision distinguished between developed and developing members in regards to the commitment to ensure that preferential rules of origin for LDCs are transparent and simple. Other developing country stated that they would study the proposal carefully with a view to exploring what could be done in favour of LDCs.
LDC group outlines priorities ahead of WTO MC10
Bangladesh, on behalf of the WTO’s Least Developed Countries (LDC) Group, presented a draft submission last week for internal deliberations which outlines LDCs’ priorities for the upcoming WTO Tenth Ministerial Conference (MC10) to be held in Nairobi, Kenya, in December.
The draft submission offers insights about priority areas of interest to the LDC Group for agreement at the upcoming ministerial, as well as their proposals regarding the core negotiating areas of the Doha Development Agenda (DDA). At press time, the draft was still under discussion by a small group of countries and had not yet been finalised.
A source close to the process indicated that the document is still being consolidated and that the LDC group will come up with a detailed proposal shortly.
Four elements of interest to LDCs – namely, duty-free quota-free (DFQF) market access, more favourable rules of origin, the operationalisation of the services waiver, and cotton – led to the adoption of decisions during the WTO’s last ministerial conference in Bali, Indonesia two years ago. Since then, the group’s focus has mainly consisted in turning some of these outcomes into legally-binding outcomes.
“It is important that Nairobi deliver concrete legally binding decisions in favour of LDCs as a priority,” reads the working document.
WTO Director-General Roberto Azevêdo has said repeatedly over the past month that the Nairobi ministerial should deliver on development issues, particularly for LDCs.
In recent weeks, discussions on a possible Nairobi “package” have centred on the possible inclusion of deliverables relating to export competition in agriculture, some transparency-related outcomes, and development and LDC-related issues, though sources note that the talks are still ongoing and the exact contents of this package are not yet finalised.
DFQF market access
According to the draft document, WTO members agreed last month at a dedicated session of the organisation’s Committee for Trade and Development that the secretariat would complete a study on the implementation of Hong Kong ministerial decision on DFQF market access by mid-November 2015.
This study will serve as a tool to provide “necessary inputs towards finding convergence” in implementing DFQF market access “in time” for the Nairobi conference, the draft submission says.
“Preference granting countries shall make DFQF market access binding through appropriate scheduling,” the document continues.
The 2013 Bali decision on DFQF market access called on developed and developing country members in a position to do so “to improve” their existing DFQF coverage if they have not yet provided such market access for at least 97 percent of products originating from LDCs. Last year, some countries – China, India, and Chile – made announcements in that regard, with Chile submitting a formal notification.
Many LDCs benefit from non-reciprocal preferences, which are granted primarily by developed countries. Applying DFQF to all LDCs, however, could effectively result in some of these countries losing some of the competitive advantages that these preferences have provided.
With no substantial progress on DFQF in recent years, the debate has focused on the potential gains under a 97 percent DFQF scheme versus full coverage and on related rules of origin, as well as on the US’ position regarding the increase of duty-free tariff lines for LDCs.
According to some informed sources, the LDC Group is proposing to resolve the DFQF issue for all LDCs by conducting a tariff line analysis with regards to clothing. The objective is to determine which tariff lines should be included under DFQF while preserving preferences under the US’ African Growth and Opportunity Act (AGOA) and the Cotonou Partnership Agreement. These allow the US and the EU, respectively, to provide trade preferences to specific LDCs.
Services waiver
The LDC Group also praised the results of indications made at the high-level meeting held this past February regarding the planned preferential treatment to LDC services and service suppliers, in line with the 2013 Bali decision on the operationalisation of the services waiver, as well as the notifications submitted so far.
Ahead of the Nairobi ministerial, LDCs further encourage the actual notification of preferences to the Council for Trade in Services (CTS), including information about “preferential treatment made available, the sectors or sub-sectors concerned and the period of time during which the member is intending to maintain those preferences.”
Some sources indicated that LDCs have also been exploring ways of extending the waiver beyond market access. Though there is a provision in the waiver decision to allow such an extension, notifications so far – with a few exceptions – have restricted themselves to Article 16 of the General Agreement on Trade in Services (GATS), which deals with market access. Non-market access measures are not automatically covered, but can be authorised by the WTO CTS.
The LDC Group’s submission links the definition of “preferential treatment” in the context of the services waiver to “the removal of restrictions, and/or the provision of, special access or procedures, in favour of LDC suppliers over non-LDC suppliers, unless the preference is accorded to LDCs drawn from other pre-existing or future preferential arrangements.”
In this vein, the LDC group encourages preference-granting members which have already notified to improve their notifications.
According to some experts familiar with the draft submission, the inclusion of a paragraph related to the reduction of administrative procedures and reduction of fees for visas, work permits, resident permits, and licenses in favour of LDC service suppliers and independent professionals appears to be important, though will likely be very sensitive to address.
In cases where preferential treatment was given to LDCs based on existing commitments or from their applied regimes that contain restrictions, the document stipulates that WTO members “shall remove such restrictions for LDCs.”
The LDC Group also calls for a modification of the duration of the services waiver so that notified preferences can apply for 15 years from the date that a member submits its notification.
Rules of origin
The draft submission also calls upon preference-granting countries to streamline and simplify preferential rules of origin “so that these are no more barriers to LDCs to fully avail their non-reciprocal market access opportunities.”
The LDC Group submitted a communication on 24 September in which they called for transforming the Bali guidelines on preferential rules of origin into compulsory criteria. The communication also specifies various methodologies in order for WTO members to frame their legislation on preferential RoO accordingly.
Rules of origin specify how much processing must take place locally before goods can be considered to be the product of the exporting country. They are often considered to be overly restrictive and inflexible, making it difficult for LDCs to take full advantage of the preferences they are granted.
At a meeting of the Committee on Rules of Origin last week, China and Thailand presented their new preferential rules of origin programmes for LDCs, sources confirmed, with Japan also reporting clothing-related changes in its preferential rules of origin for least developed countries. These updates were reportedly welcomed by some LDC delegations, who also put forward some follow-up questions.
Regarding the negotiations for harmonising non-preferential rules of origin, sources say that the US, Canada, and Australia were among those members who are still arguing against substantive negotiations to develop common rules, on the grounds that these would impose significant administrative burdens and be unlikely to facilitate trade.
An informal open-ended consultation on preferential rules of origin for LDCs held on Tuesday reportedly examined the 24 September submission on the subject from the LDC Group, in the context of the overall Nairobi ministerial.
Cotton, agriculture
The draft submission also refers to the difficult issue of cotton, calling for a “satisfactory solution” on the subject as part of the Nairobi decisions. The document raises four points related to DFQF market access for cotton and cotton-by products specifically; the reduction and elimination of domestic support and cotton export subsidies; as well as technical and financial assistance.
Regarding food security, the draft submission calls for a ban on applying export restrictions by any non-LDC WTO member on foodstuffs imported by LDCs if the exporting member is a net exporter of the foodstuff concerned.
The text also provides for an exemption of the de minimis calculation for the purchase of food at administered prices by LDCs under public stockholding schemes for food security purposes.
The submission highlights the underutilised production potential in agriculture among LDCs and stresses the need to promote development through improving agricultural productivity and production.
On domestic support, the submission calls for a substantial reduction of all forms of market distorting subsidies, with a view toward their eventual elimination. For this purpose, the LDC Group reiterates the need to preserve their flexibilities embedded under the 2008 agriculture draft modalities, known in trade jargon as Rev. 4.
“Innovative and practical approaches should be considered to avoid box-shifting practices by members that impact trade distorting domestic support reduction commitments,” says the LDC document.
On export competition, LDCs call for eliminating all forms of export subsidies and disciplines on all export measures, with a phase-out period of three years for developed countries and six years for developing countries from the date of the decision.
NAMA
With regard to non-agricultural market access (NAMA), the communication refers to an exemption from tariff cuts and increase of the level of tariff binding commitment in the context of any agreement on NAMA during MC10. “LDCs shall also be accorded safeguard policy space for industrial development,” the document says.
The document also specifies that LDCs should not take on reduction obligations arising from commitments made by non-LDCs in the event of a shared customs union between countries from both categories.
NTBs and SPS
With regard to non-tariff barriers (NTBs), LDCs support the proposal of the African, Caribbean and Pacific (ACP) Group for a Nairobi agreement to establish a Working Group on NTBs under the auspices of the Council for Trade in Goods. This new group would examine crosscutting NTBs in importing markets on developing country exports, with a particular focus on LDCs.
Regarding sanitary and phytosanitary (SPS) measures, which can be difficult for LDCs to meet in some export markets, least developed countries plan to request the establishment of a scheme under their aid for trade programmes for the full cost recovery of SPS inspection controls on imports originating from LDCs. Doing so, they say, would help minimise their trade costs and ensure a level playing field with their competitors.
Special and Differential Treatment
Despite having previously been considered as a possible deliverable for the ministerial conference in Bali two years ago, the Special and Differential Treatment (S&DT) proposals were dropped ahead of that ministerial meet, with sources faulting the complexities that emerged in revisiting the decade-old proposals.
According to the draft submission, the LDC Group, ACP Group, and the African Group have identified 25 S&D provisions and made specific textual proposals aimed at “strengthening these S&D provisions and making them ‘more precise, effective and operational.” The document also mentions a July submission by the G-90 on this issue.
Originally created as an overarching mechanism to give preferential treatment to developing and least developed countries, the S&DT measures aimed to help these countries more easily integrate into the multilateral trading system. To this end, paragraph 44 of the Doha Ministerial Declaration granted a mandate to review all S&DT provisions with a view to making them stronger, more precise, effective, and operational.
Fisheries
With regard to fisheries, the document calls for strengthening disciplines on sea fisheries subsidies. Given that fisheries represent a crucial sector for LDCs, the document reiterates that any discipline in fisheries subsidies shall not prevent LDCs from maintaining subsidies that do not contribute to overfishing or the depletion of fish stocks. The document also reiterates the preservation of S&DT provisions for LDCs in this sector.
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WEDF: Enabling trade through sustainable development and innovation
Accountability, competitiveness and innovation key to making trade sustainable and inclusive
The first day of the World Export Development Forum (WEDF) 2015, being held in Doha, Qatar, heard policymakers and trade practitioners call for a range measures to ensure that trade becomes more sustainable and more inclusive.
At a session looking at ‘Unlocking the Potential of the Post-2015 Development Agenda’, speakers pointed to the need of reducing trade costs. This, they agreed, could play a key role for developing countries and their small and medium-sized enterprises (SMEs) to reap the benefits of connecting to international trade and investment, they said.
And while Aid for Trade and public-private partnerships (especially at the local level) had an essential role to play in trade inclusion and the new Global Goals more broadly, they said that nothing could replace determined domestic policymaking, implementation and accountability.
SME competitiveness
WEDF’s second plenary session, ‘SME Competitiveness: Why it Matters’, took its cue from the recent launch of ITC’s new flagship publication, the SME Competitiveness Outlook.
During the session, speakers pointed for the need to identify constraints to trade which will allow for small and medium-sized enterprises to flourish. They also agreed that greater e-connectivity and internet access are not only closely connected to innovation and economic growth, but also help reduce conflict.
Innovative funding
For SMEs to thrive, there is a need to think more creatively to on how to improve access to finance and making credit more available. This was the unison message of speakers during the session on ‘Innovative Funding to Internationalize SMEs’, who also said special attention must be placed on making funding available to women-owned businesses.
But it is not just about access to credit, the speakers said: a broader ecosystem of support, such as for financial literacy in subjects like trade finance, and risk sharing, for example in government credit guarantee schemes, is necessary to help SMEs succeed.
Innovation and entrepreneurship
During what was perhaps the liveliest session of WEDF’s first day, ‘Innovation and Entrepreneurs: Trends That Shape the Trade Landscape’, speakers battled it out over issues ranging from e-commerce and digital literacy, and how these can help spur economic growth and innovation.
They also pointed to changing patterns of trade, including a shift from a ‘linear economy’ to the concept of a ‘circular economy’, described as move from a resource extractive model to one based on resource efficiency and closed-loop, restorative ecosystems. Developing a business strategy based on concepts such as “reduce, re-use and recycle” is now a key element to maintaining a competitive position in the market, the audience heard.
Speakers also said that there is a need for SMEs to understand the challenges and opportunities arising from the rise of global value chains and prepare themselves to participate in this new dynamic. International agencies such as ITC, the speakers said, have a key role to play in supporting SMEs in enhancing their competitiveness so they can reach their full potential and maximize the benefits from a more global and interconnected world.
SME Competitiveness Outlook 2015: Connect, compete and change for inclusive growth
The SME Competitiveness Outlook, the first annual flagship report of ITC on the topic of SME internationalization, argues that small and medium-sized firms are the ‘missing link’ to inclusive growth.
The report highlights the fundamental role SMEs have in addressing global income inequality and presents a new analytical framework to measure, identify and enhance SME competitiveness. It introduces a working definition of firm competitiveness and introduces the SME Competitiveness Grid as a tool to classify determinants of firm competitiveness according to how they affect competitiveness and according to the layer of the economy at which this determinant intervenes.
It shows that SMEs are generally less productive than large firms. The productivity gap is wider in developing countries, and the wage gap is similar. It also shows that firms connected to international markets are more productive and create more employment.
The report provides 25 country profiles containing SME competitiveness pilot assessments. It informs ITC’s work in strengthening SMEs and trade and investment support institutions (TISIs). The case studies illustrate how ITC assistance fits within the wider evidence on SME competitiveness and describe practical steps to strengthen SME competitiveness at the firm level.
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Africa’s population boom: Will it mean disaster or economic and human development gains?
The population in Africa is rapidly expanding, and by 2060 the region will hold an estimated 2.8 billion people. With the right policies and actions, countries in Sub-Saharan Africa can reap a tremendous demographic dividend from this growth to propel an economic takeoff, according to a new World Bank report.
The report, Africa’s Demographic Transition: Dividend or Disaster?, notes that demographic change such as population growth and a reduction in the number of dependent youth, can have a deep impact on a country’s economic growth and the well-being of families. The report lays out an agenda for African countries that can increase the likelihood of capturing the potential social and economic benefits from population growth to create a demographic dividend in Sub-Saharan Africa. At the same time, it poses a challenging dilemma if the right policies and actions are not implemented judiciously.
“The growth in Africa’s working-age population will be relentless and inevitable,” said Punam Chuhan-Pole, acting chief economist for the World Bank Africa region. “The good news is that with the right policies and actions today, countries can accelerate the region’s transition to smaller families, healthier and better-educated youth, and an expanded job market if policymakers make the right decisions.”
For the past 15 years, countries in Sub-Saharan Africa have experienced impressive and sustained economic growth and development. Child mortality has dropped in most countries and fertility rates, or the number of children born per woman, have significantly been cut for educated women living in urban areas. Throughout the region, however, fertility remains stubbornly high, with an average of 5.4 children born per women in 2005-2010, and down from 6.5 children per woman in 1950-1955.
The slow decline in fertility in Africa will likely result in a rapidly growing population, with estimates showing that the region will become a much larger part of the world population. By 2060 there will be about 10 billion people in the world – 5.2 billion in Asia, 2.8 billion in Africa, 1.3 billion in the Americas, 0.7 billion in Europe, and 0.1 billion in the rest of the world.
How will this population boom impact African countries? The answer depends on how each country responds today with policies, the report says. Policy choices and actions can transform the population of a nation into a healthy, educated, empowered labor force that can contribute to real and sustained economic growth that lifts people out of poverty, according to the report.
The report contrasts the demographic changes in Africa with those in East Asia, Latin America, and the Middle East. For example, from 1975 to 2010, East Asia experienced a rapid decline in fertility that reduced youth dependency and at the same time increased the number of working-age people (16-64 years old). The resulting demographic was 1.5 workers per new birth in the early years, hitting a peak of 2.5 workers per birth over 35 years.
At the same time, East Asia capitalized on export-oriented policies that increased the demand for labor. With more working adults, and fewer children per family in East Asia, resources were freed to allow families and the government to invest more in child education and health care, providing for a healthier cohort of working adults with skills, ready to move into the economy’s expanding job market.
The report also takes a regional approach to outlining the potential for a demographic dividend and presents broad recommendations that can begin to tackle the challenges and build on recent successes, such as:
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Harnessing the demographic dividend means empowering women and girls by improving their health, education and skills, and providing them with greater market, social, and decision-making power
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In countries where fertility is falling and the working-age share is rising, the focus should be on creating high-productivity employment for the large working-age cohort and encouraging investments in the health and education of the smaller youth cohort
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In more mature economies, with larger formal sectors, the focus should be on generating domestic savings and female labor force participation outside the home
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Ensuring sufficient savings for retirement will also address the issue of an aging population that will emerge as the demographic transition comes to an end
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In fragile states, a lack of security may make any interventions difficult. Here the emphasis should be placed on maintaining child health, access to health care, and family planning, where possible, to develop the preconditions for a demographic dividend
» Download: Africa’s Demographic Transition: Dividend or Disaster? (PDF, 11.09 MB)
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Cultivating sources: Africa’s changing role in global supply chains
Executive Summary
Sourcing products and services from Africa is an option that makes sense to more and more firms, both international and African, each year. Though the spikes in inward direct investment during the global financial crisis were temporary, the longer term trend of increasing flows into Africa is set to persist (see chart, below). As companies expand their supply chains into the continent, inward investment into sub-Saharan Africa is expected to grow by more than a third from 2015 to 2019, while investment into North Africa is set to rise by nearly 70% in the same period.
Pull factors include cheap labour – unskilled wages in East Africa are approximately a tenth of those in China – and abundant raw materials. A global trend towards shorter, simpler supply chains also makes the region particularly attractive for European firms. African governments are increasingly carving out a role for the private sector in their development and industrialisation strategies, and are introducing incentives such as duty-free exports and cheap land leases in target sectors. Infrastructure improvements to pave the way for further investments are in full swing, particularly in coastal areas, and the difficulties associated with exporting from African ports are diminishing slowly but surely. Large cities such as Nairobi and Lagos are also gaining access to broadband Internet, supporting a nascent services outsourcing sector.
Perhaps most importantly, an African middle class is emerging. Though affluent consumers with significant disposable income still represent a relatively small fraction of most African national populations, a combination of rapid wealth creation and urbanisation, particularly in regional hubs, is starting to catch the eye of some in the international business community. As a consumer market, the continent is likely to represent one ofthe biggest growth opportunities in coming decades, and this is starting to factor into the decisions of firms when they choose to establish or expand local production bases. Some firms are already wholeheartedly pursuing the local market, while others currently exporting from Africa are starting to explore opportunities throughout the continent.
The Economist Intelligence Unit (EIU) expects Sub-Saharan Africa’s GDP per head to grow by an average yearly rate of 2.1% over the 2015-2019 period (inclusive). Yet wealth creation will progress much faster in the most vibrant and diversified African economies, such as those in East Africa working to develop a manufacturing and services base . Relying on imports to service the growing demand for consumer goods is neither desirable to locally-based firms, who wish to have cheap, responsive supply chains; nor to consumers, who pay a premium for imports; nor to governments, who wish to capture more added value in the domestic economy.
And yet Africa, long exploited for its raw materials and flooded with cheap consumer goods from Asia, remains a largely overlooked destination for manufacturing and services. Many companies remain daunted by a prospect they view as risky. Data indicating rising inward investment flows, improving infrastructure and a rising middle class take time to overpower lingering impressions of dirt roads, impoverished populations, political violence, red tape and entrenched corruption. In many parts of Africa these impressions unfortunately still hold true. Forty out of 47 African economies were ranked in the bottom half of the World Bank’s 2014 global ”Ease of doing business” scoreboard. But Africa is a very large, diverse continent. Even at a sub-national level, some areas may be mired in conflict while others experience an economic boom. Nigeria – with Boko Haram causing ongoing troubles in the north-east, but Lagos in the south-west seeing growth in banking, retail, manufacturing and even a film industry – is just one such example.
The companies featured in these case studies all have one thing in common: a long-term vision of Africa, not simply as a source of minerals or market for imported goods, but as a vibrant, well-functioning environment for manufacturing and services. They want to get in early on the action. Rather than waiting around for local suppliers to reach a certain standard, they are committed to facilitating local partners to climb the value chain.
This report explores how established domestic and multinational firms have addressed the challenges of managing and developing their supply chains in African countries. The hurdles facing UK-based manufacturer of quality leather goods, Pittards, as it looks to expand its manufacturing presence in Ethiopia, demonstrate the need to actively engage with local suppliers to improve quality. Cafédirect, an ethical hot drinks brand based in the UK, is grappling with the impact of climate change and urbanisation on the long-term viability of tea, coffee and cocoa farming in Africa.
Multi-national conglomerate GE is establishing a regional manufacturing and services hub in Nigeria. In the process of developing a local supplier base, as well as providing access to training and finance, it is encouraging its global suppliers to invest in local partners. Services outsourcing firm Digital Divide Data (DDD), also based in the US, similarly offers opportunities for African talent to connect into global value chains. Finally, Kenyan retail multinational, Nakumatt, is growing its footprint across East Africa as fast as the infrastructure and customer base allows.
Key findings
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Misunderstanding of Africa as a manufacturing and services environment is still rife. Many people underestimate the range of activities that can be carried out, yet those who do decide to invest in Africa are prone to underestimate the effort required to ensure a reliable supply of good quality products.
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The tendency of the international business community to underestimate Africa as a manufacturing and services location has been a competitive advantage for the early movers featured in this report. But as interest in the region grows, time may be running out to benefit from the early-mover advantage.
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Investors with existing international client and supplier networks have an advantage over local competitors, in that they are able to take on more risk when launching operations in Africa, where the client and supplier bases are still emerging.
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The firms interviewed do not view localisation policies – at least where these are well designed and implemented – as a hindrance, as such policies are aligned with their own strategies to move up the value chain in Africa.
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Africa’s advantages as a source of agriculturally-produced raw materials are eroding, as land is lost to climate change and agricultural labour is lost to urbanisation. Buyers may therefore need to help introduce new methods and technologies to improve yield and quality, and to mitigate the impact of climate change, to ensure sustainable supply in the long term.
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Lack of finance is still a major constraint for smaller businesses and farmers. In order to help suppliers scale up their operations and access new equipment – which is beneficial to both supplier and buyer – some firms create supplier financing mechanisms, act as guarantors for their partners, or commit to paying premiums for higher-quality products.
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Intra-African trade remains well below potential, and this is a source of frustration for companies wishing to extend supply chains beyond or among the coastal nations.
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Wages are incrementally rising as African economies develop, and other costs (notably oil) are also set to go up. As the cost advantage compared to Asia gradually diminishes, gains in productivity and value- added will become more important over the coming five to ten years.
This report from The Economist Intelligence Unit is part of the Growth Crossings series.
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Rethinking development strategies after the financial crisis: Making the case for policy space
The recent economic trends and the challenges posed by the global crisis reinforce the importance of implementing strategies for development as opposed to leaving the economy to market forces.
Countries need a strategic compass for long-run economic development, either explicitly or implicitly. Among other ingredients, this comprises macroeconomic policies, sectoral policies (including the financial sector, trade and industrial policies), institution building in key areas and development-friendly global governance. Within a chosen medium- or even long-term strategy, governments need more policy space to adjust to the specific (and evolving) social, historical and institutional context.
The experience of Asia shows that rather than implementing narrow and rigid general guidelines, experimental approaches – which require policy space – are a recipe for success. Furthermore, the slow-growth periods endured by several countries (the “lost decades”) allowed inferring which policies should be avoided.
The authors of this publication share the notion that developing countries can and should learn more from each other, as well as from their own past experience. It is important to look at comparisons between developing countries, including both success and failure stories.
In this first volume, the general issues that all developing countries need to handle are discussed, as well as highlighting some key policy areas of interest for most of them. Theoretical thinking on economic development largely relies on comparative analysis. In particular, it explores the reasons why some countries or regions have performed better than others in the long run.
» See also: Volume II: Country Studies and International Comparisons (PDF, 2.42 MB)
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Xenophobia abhorrent to regional integration
Xenophobia and regional economic integration are contradictory. Without the free flow of people, goods and services, there can never be regional integration or building a community of regional citizens.
These observations were made at the southern Africa inaugural seminar series hosted by ECA Southern Africa office in partnership with the African Peace-building Network of the Social Science Research Council in Livingstone, Zambia from 7-8 October 2015.
The two day-seminar was held under the theme of Conflict, Peace and Regional Economic Integration in Southern Africa: Bridging the Knowledge Gaps and Addressing the Policy Challenges.
According to the Livingstone declaration, a communiqué from the seminar; poverty, inequality and unemployment were among the major drivers of conflict and xenophobia in the region and called for “progressive social policy, skills and capacity development and promoting qualitative and inclusive economic growth” as key in addressing the problem.
Further, the seminar called for a Pan-African and visionary leadership as essential for promoting regional economic integration and called for a people-to-people-centred integration as foundation for regional integration in which people are able to move freely without any discrimination or negative profiling.
The Southern Africa seminar series aims to promote debate, discussion and policy options on topical socio-economic issues affecting the region. The series will be held annually on a revolving basis throughout southern Africa.
Participants consisted of scholars, policy-makers and government officials, and representatives from civil society, regional institutions, UN agencies and regional economic commissions. Participants came from across Southern and Eastern Africa and also the United States of America.
The Livingstone Declaration
Preamble
The United Nations Economic Commission for Africa’s (UNECA) Sub-regional Office for Southern Africa (SRO-SA) and the African Peacebuilding Network (APN) of the Social Science Research Council (SSRC) organized a seminar on “Conflict, Peace and Regional Economic Integration in Southern Africa: Bridging the Knowledge Gaps and Addressing the Policy Challenges.” The seminar was held at AVANI Victoria Falls Resort, Livingstone, Zambia, from 7-8 October 2015.
Participants consisted of scholars, policy-makers and government officials, and representatives from civil society, regional institutions, UN agencies and regional economic commissions. Participants came from across Southern and Eastern Africa and also the United States of America.
Seminar Objectives
The purpose of the seminar was to create a forum for discussing emerging issues on the topic of “Conflict, Peace and Regional Economic Integration in Southern Africa”. In this regard, participants discussed the problem of conflicts that have recently surfaced in the sub-region with the aim of understanding their remote and immediate causes, the economic costs and the broader implications for regional economic integration in Southern Africa. Specific key issues addressed included:
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The sources, dimensions, costs and implications of conflicts and crises on regional economic integration in Southern Africa;
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The legal and institutional frameworks put in place to address the problem in the region;
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The issue of migration and xenophobia in the context of regional integration and its economic implications for the region;
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The role of regional frameworks, countries and peoples in stimulating economic growth, increasing economic opportunities, and ensuring collective prosperity for the region.
Summary of Proceedings
Welcome remarks and opening statements were made by three people: the Director of the ECA Sub-Regional Office for Southern Africa, the Director of the Africa Peacebuilding Network of the Social Science Research Council (SSRC), New York and the Deputy Minister for International Relations and Cooperation of the Republic of Namibia. The three speakers underscored the importance of promoting peace and stability in the region as a necessary condition for achieving regional economic integration in Southern Africa, and Africa in general.
Observations:
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There has been an increase in the level of conflicts in the world generally in recent times, in the face of growing inequality and lopsided growth;
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Africa remains a major spot of conflicts in the world, which are complex in their nature, context, dimensions and outcomes. Conflicts are of political, economic and social dimensions in Africa;
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Southern Africa has experienced relative peace and stability, but recent conflict incidents in countries like the DRC, Mozambique, South Africa, Madagascar, and Zimbabwe directs our attention and policy concern to the issue.
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Historical legacy and consequences in the nature of state-formation and social pluralism, including apartheid, continues to generate conflicts in the region;
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Governance deficits, growing inequality and poverty, and relative deprivation have consequences for conflicts in the region;
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Migration has been part of African history and our cultural experience of social survival, however, the recent xenophobic attacks question that experience and the drive towards a people-driven regional integration project;
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Xenophobia and regional economic integration are contradictory. Regional integration can only be achieved through the free flow of people, goods and services and building a community of regional citizens;
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Southern Africa suffers from the triple problems of poverty, inequality and unemployment, which continues to influence conflict outbreaks.
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Gender inequality exacerbated by gender-based violence remains part of our lived experience in Southern Africa in spite of the progress recorded on gender empowerment;
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Conflicts have serious economic costs and consequences for the region and the continent as a whole. They decelerate economic growth, divert resources for development into regional peace-building and have politically destabilizing effects on the region;
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The early warning system to detect conflicts at the national and regional levels remains weak, and requires strengthening;
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The institutional mechanism and capacity for conflict resolution and management at the regional level, particularly in SADC, remains inadequate and poorly-funded;
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A regional economic integration process that generates uneven and asymmetrical benefits for its member-states without adequate remedies may likely generate conflicts;
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Civil society’s inclusion in peace making, peace building and regional economic integration remains very limited thus not tapping effectively into a powerful resource for regional integration;
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There is a convergence between national level democratic practices and culture and what happens at the regional level;
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The repository of knowledge, skills and capacity to promote regional integration is rather inadequate and needs to be strengthened;
Recommendations:
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There is need to scale up democratic processes, practices and culture in the region including specifying term limits for political office holders;
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Pan-African and visionary leadership is essential in promoting regional economic integration devoid of violent conflicts, based on organic solidarity and common commitment to regional integration;
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People-to-people-centred integration should be the foundational basis of regional integration in Southern Africa in which people move freely without any discrimination or negative profiling;
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Xenophobia is anathema to regional integration, hence governments, policy makers, civil society actors, private sector, and other stakeholders should engage in serious policy conversation on how to eschew xenophobia from our regional development process;
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The problems of poverty, inequality and unemployment have to be squarely addressed in Southern Africa; progressive social policy, skills and capacity development and promoting qualitative and inclusive economic growth are essential in addressing the problem;
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Cross-border identities constitute a powerful resource that should be tapped into in stemming conflicts and promoting peace and regional development;
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The need to leverage formal and informal African-centred education and thinking to bring about a change of mindset towards economic growth and regional integration;
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Equity should define the regional development project. Regional value chains that crowd in all countries in the region in the industrialisation process should undergird the new SADC Strategy and Roadmap on industrialisation;
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Leaders in the SADC region should invest in institution building and capacity development for SADC. Without a good institutional framework and capacity, SADC cannot perform its role as an effective conflict manager and promoter of democracy in the region;
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Community-based approaches to conflict resolution and management and also democracy promotion should be encouraged;
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Effective early warning systems should be developed at the local, national and regional levels for identifying sources of potential conflicts;
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Inclusion, participation, voice and local power should be taken seriously in national democratic and development processes; civil society, private sector, and other stakeholders should be given adequate space in democratic politics;
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There is need for more research, and knowledge production on the dynamics, and intricacies of regional integration at the national level;
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Improved interaction between academic and policy communities with a view to enhancing the quality of policymaking on regional integration in Southern Africa.
Closing Ceremony
On behalf of the organizing institutions, the directors thanked the participants for the lively and engaging presentations and discussions that transpired over the two days of the seminar. They assured the participants that the recommendations will reach as many policymaking organs as possible at both national and regional levels. The organizing partners also undertook to do all they can to pursue further research, particularly in the areas that the seminar identified as requiring deeper analysis.
Related News
India-Africa trade: Continuous sunshine
The dynamic relationship between India and Africa is built on a shared future, common natural resources, similar demographics and large domestic markets. As both regions aim to increase bilateral trade five-fold to USD 500 billion by 2020, it will be critical for Governments, Industry and other key stakeholders to focus on greater market access, availability of trade finance and simplification of bilateral business processes and tax regime.
The Third Africa-India Forum Summit is now scheduled to be held in New Delhi on October 26-30, 2015 and the Indian Government wishes to make the summit a wider ranging participatory and result-oriented one. Instead of simply enhancing goodwill measures, the third summit is to focus on utilising trade and investment opportunities to propel economic growth in these two regions, and expectations are high this time.
African continent presents an opportunity to invest, trade and build economic partnerships. There are definitive advantages to be derived from robust, low cost and enduring solutions for investment, infrastructure, social, education, health etc. that India has developed that may be effective under similar socioeconomic conditions in Africa. India too stands to gain immensely from all these aspects. Besides gains from trade, India can derive benefits mainly by creating partnerships in the areas of food security, energy security and non-fuel mineral resources.
At the moment African business community has no significant presence in India, except for a few in banking business like FirstRand Bank (FRB) and State Bank of Mauritius (SBM). However, interests are expressed by the African business community to invest in India, particularly in sectors like food and hospitality. To facilitate such possible business partnerships and ventures there is a need for assistance and active intermediation from the Indian government.
Key Future Potential Growth Sectors in Africa
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The biggest opportunity of future growth is probably in the consumer-facing sectors like consumer goods, telecom and banking apart from others. By the end of 2008, these sectors started growing two to three times faster than those in OECD countries.
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India has a golden opportunity to initiate partnerships with African nations in agriculture where it can benefit from the increased African output while contributing positively to Africa in terms of technical assistance, skill building, and research and development in agriculture.5 Africa will benefit in terms of increased output by using idle capacity, mainly unused arable land.
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Food and beverage spending is projected to expand the most in absolute terms, compared to any other consumer good category. However, with continuous development usually the spending pattern shifts towards higher quality goods. If consumption actually rises along with an increase in household income at the current rate then rapid increases are expected in retail banking, telecom and housing.
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African Development Bank estimates that if Sub-Saharan Africa (SSA) could achieve infrastructure development similar to that of Mauritius, then annual GDP growth in entire region may rise by 2.3 per cent. Africa needs $93 billion every year to create infrastructure for supporting growth and meeting development goals – two third for new investments and the rest for maintenance. African governments spend an average of $45 billion per annum on infrastructure, two third of which is domestically mobilised from taxes and user charges. Most of the new capital investment comes from external sources. For the specialised private or public sector infra and construction companies in India there are huge opportunities in infrastructure and constructions projects in different parts of Africa.
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Productions of different industries in different countries have substantially slowed down due to the overall slowdown in world economy, but still extractive industries will continue to support growth in 2015 and 2016 in most of the African resource-rich countries. According to estimates, the volume growth rate of the continent’s oil, gas, and most minerals can be between 2 and 4 per cent per annum in future. Even at current prices, the value of resource production has the potential to touch $540 billion in 2020, rising from an approximate $430 billion currently.
Africa and India: A New Frontier for Mutual Prosperity
India and Africa share many things in common, including heritage, culture and ancient trade. Broad cornerstones of future partnerships will be:
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Partnership in agriculture: While India can help Africa in agricultural capacity building, Africa can help India in ensuring future food security.
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Resource based partnership: India would do well to explore sustainable ways to contribute to the African growth story while benefitting in terms of its own energy security.
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Non-resource based partnership: While some African countries may need financing, others may be looking for partnerships in skill and capacity building. Depending on the difference in economic structures, India can build partnerships with both categories.
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Social sector cooperation and investment: Education, healthcare and housing sectors present a huge opportunity for cooperation and investment.
Exploring Investment Opportunities: Mutual Benefits
Indian Investment in Africa
Indian government-backed initiative to engage with Africa should provide ample opportunities for Indian outward FDI as well, and no Indian engagement with Africa will be complete without mutual exchange of direct investment. The first ever outward Indian FDI went to Africa – a textile mill established by the Birla Group in Ethiopia in 1959. Indian multinationals have ventured into both green-field and existing investments – in telecom, energy, computer services, power and automobile sectors, among others.
Major Reasons Behind Rising Trend of Indian Investment in Africa
Government policies, coupled with moderate but consistent economic growth, have given confidence to Indian companies to invest abroad through FDI route. Bilateral investment treaties (BIT) and double taxation treaties (DTT) also encourage better flow of FDI in host countries. Host country policies, like changes in corporate tax rates, other fiscal incentives and other privatisation policies, also influence OFDI. Along with political and cultural factors, other factors influencing outward FDI include comfort in English language and geographical location.
Composition of Indian FDI in Africa
Indian investment in Africa has been in primary commodities such as oil, gas and mining. In manufacturing sectors, automobile and pharmaceutical firms historically invested in different African countries. Pan-African investments are also made by prominent Indian telecom, chemical, metal and fertiliser companies.
Africa: New Destination for Investment and Capital Flow
According to Financial Times, Africa is the fastest growing destination for FDI. In 2014, the capital investment coming into the region grew by 65 per cent to an estimated US$ 87 billion, while the global green-field FDI market expanded by only 1 per cent. The number of projects in Africa increased by 6 per cent. Apart from investments in resources, there have been strong FDI inflows into real estate, hospitality and construction in 2014 along with consumer facing sectors like technology, media and telecom, financial services, consumer products and retail. There has also been visible enthusiasm about agricultural sector based investment activities in 2014.
Africa’s Outward FDI: Possibilities and Realities
In today’s financially integrated world, capital, even from an early stage economy, creates aspirations for itself. It is important to note that African outward FDIs include intra-continent investment of African capital which is the second largest source of FDI in Africa. Employing a part of country’s financial resources outside remains essentially a policy decision, and an issue of political economy in any particular country. However, there are African countries in advanced stages of development such as South Africa, where companies are quite keen on investing not only inside but also outside the continent.
Outward Investing African Countries and India as the Potential Destination
In a financially integrated world, foreign investment is increasingly transforming itself into a two-way affair because of global aspirations of transnational capitals. High-profile countries like Mauritius show steady outflow of FDI ; Democratic Republic of the Congo has shown quite a big jump in FDI outflows in the last three years; Tunisia, Burkina Faso, Guinea, Senegal, Togo, Cameroon, Gabon, Zambia and Zimbabwe show sporadic outflows. Algeria, Egypt, Libya, Morocco, Liberia, Nigeria, Angola, and South Africa have shown steady and quite high outflows of FDI in recent times. Some of these FDIs from Africa have the potential to come to India.
Towards a New Era of Investment between Africa and India
Given the enduring relationship with Africa, India is in a perfect position to initiate a mutual organic growth partnership. The relationship has to be built not only on economic fundamentals, but also on mutual trust. With India’s clear intention to contribute to the capacity and skill building in Africa, the cornerstone of the relationship must be trade and investment. With relatively free flowing capital and enhanced facilitation on both sides, India and Africa can contribute to each other’s growth story. It will feed positively into economic multiplier mechanism and boost economic development in both regions.
Role of Trade Agreements in Facilitating Trade
Trade Agreements and Trade Blocs in Africa
Since the early 1990s many African countries have made significant progress in opening up their economies to the rest of the world, either through trade liberalisation or by exchange rate liberalisation. With the creation of regional trade agreements in other parts of the, African nations too entered into 30 regional trade agreements (RTAs) or trade blocs, many of which are part of deeper regional integration schemes with an aim to strengthen intra-regional trade and investment relations by eliminating or reducing tariffs and other barriers, and fostering a common economic union amongst member states.
India’s Trade Agreements with African Countries
India has already signed bilateral free trade agreements with 19 African nations and Preferential Trade Agreements with 13 other African countries. Currently, India is negotiating for preferential trade agreements with SACU countries and other trade blocs such as RECs, COMESA and ECOWAS to create a conducive environment of trade. India is also negotiating a Comprehensive Economic Cooperation and Partnership Agreement (CECPA) with Mauritius.
Impact of Existing Trade Agreements and Blocs on Indo-Africa Trade
Substantial evidence supports the fact that signing of agreements with Africa gave a fillip to the existing trade. In 1991 where India’s total trade with Africa was only 97 million USD, it reached 71 billion USD11 in 2014-15 with a compound annual growth rate of 31 per cent. As a result, the trade balance of India with African countries has substantially improved, which is a positive development in Indo-Africa trading relations. African countries also have the potential to improve their trade fundamentals by exporting into Indian markets, if more such agreements with India fructify.
Implications of the Africa Free Trade Zone
The Tripartite Free Trade Area (TFTA), will integrate the 26 member countries of COMESA, EAC, and SADC.
Future targets of all these trade negotiations also include a gigantic plan to create a Continental Free Trade Area, consisting of all 54 nations, by 2017, which will have a combined market of one billion people. African countries as of now belong to several groups, thereby making the process of any trade agreement with them somewhat cumbersome. It is hoped that TFTA will facilitate access to markets within the region and end overlapping membership complications. The deal also aims to strengthen the blocs’ bargaining power while negotiating at the international level.
Non-Tariff Measures in Africa
In recent years tariff rates applied by countries around the world have fallen to historic low levels owing to the growing number of multilateral, regional and bilateral trade agreements. Instead, traded goods are required to comply with various regulations which include licenses or permits to import, quality requirements, inspections and price controls, before they are allowed to enter the destination market. These regulations are classified under non-tariff measures.
African countries appear to regulate their imports more than many other developing countries, especially in relation to Pre-Shipment Inspections (PSIs), possibly implemented to fight corruption, to facilitate and accelerate custom procedures and ultimately to help in the correct evaluation of imports and taxation, all of which greatly affect African countries. To enhance trade relations with India and other potential trade partners outside Africa, greater regional coordination and efficient regulatory procedures will have to be established.
Scope and Possibilities of New Trade Arrangements
Some of the sectors that offer new trade opportunity and need focus to enhance trade relations are pharmaceuticals, capital goods, automobiles and spare parts. Countries like Nigeria, Egypt, Tanzania, and Kenya, are major markets of India. However, several new markets have witnessed significantly high growth in recent times such as Algeria, Togo, Cameroon, and Ghana. India needs to diversify its product basket persistently to keep the current growth buoyant. African countries may require capacity building in developing good SPS (sanitary and phyto-sanitary) and TBT (Technical Barriers to Trade) standards in which India can provide assistance.
Way Forward and Recommendations
To build durable partnerships, three important areas where India and Africa need to focus, in order to strengthen their trade relationships are:
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Mutually beneficial resource partnerships
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Solving the raw material conundrum
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Agriculture and food security
The following are key recommendations that this study makes, based on data analysis and overall assessment of existing trade relations between India and Africa:
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Africa-India Summit is already a regular platform which has been created. The platform needs to be further strengthened and formalised with defined engagement terms.
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In the light of formation of Tripartite Free Trade Area (TFTA) and the proposed African Free Trade Zone, India should immediately engage itself with all trade blocs and associations, including African Union. The objective should be to come into a common understanding of promoting mutual trade and investment. Wherever possible, bilateral arrangements also need to be explored for the same objective.
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While trade agreements are important, investment treaties have to be taken up equally seriously to further enhance and nurture bilateral and/or multilateral trade agreements.
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Confidence and trust building measures from Indian side, like establishing skill building institutes and research facilities, more direct business-to-business interactions, workshops and seminars, have to be further increased with immediate effect – to create a conducive atmosphere for talks.
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While initiating investment treaties, other bottlenecks for free capital flow have to be cleared also through double taxation treaties or other arrangements. Otherwise, the engagement process may get stalled in future.
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Indian government may have to take an active part in creating additional capacities on African soil, particularly in those which will be part of confidence building measures.
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Instead of only utilising individual channels, India also should make an effort to engage itself with African nations through the platform of BRICS, since South Africa is a partner in that platform. This may create additional catalysts for development.
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Once negotiations progress to a satisfactory level, care should be taken by the Indian government to identify key sectors, in which capital and trade flows (both ways) can be prioritised and facilitated. In immediate future it seems that consumer goods, wholesale and retail, construction, housing, telecom, financial and banking services are the sectors where India can engage itself with African nations at various levels.
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A sizeable section of African diaspora is present in India – in the form of students, diplomats, workers of different governments of Africa and tourists. African companies can easily export African processed food to cater to this population. Urban India is increasingly showing tendencies to consume foods of different continents, and therefore food and agro-based exports from Africa have a potential market in India. Indian and respective agricultural ministries of African countries should have an active cooperation for such exports of African foods and agro-based products.
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Healthcare, tourism and travel are other sectors where African nations want to venture. India should facilitate such endeavours both in India and anywhere in African soil.
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Pharmaceutical sector is another sector, where Indian companies have potential to be the “pharmacy of Africa.” Presence of more generic Indian drugs, lack of awareness, and health standards are some issues hindering further expansion of Indian pharma companies, which is probably why Indian presence is mainly limited to Eastern African region. Development in biotechnological research, compliance to international health standards, and awareness programmes, like exhibitions or pharma fairs, are needed to remove these barriers. Indian government can play a positive and pro-active role in this process.
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Social sectors, including cultural interactions (music, dance, theatre) and particularly education, create opportunities for India. Direct investment in education also has the ability to build trust. However, there needs to be a mixture of investment and philanthropy from Indian side in education.
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In sports and related activities, African nations can help out India, and that can form one of the bases of a reverse trust building exercise.
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Deeper research into bilateral and multilateral trade and economic aspects warrants good quality data. India would do well if it can get into information sharing understanding with as many African countries as possible. This will hugely facilitate future progress of talks and other economic and political interactions.
This joint study was prepared by the Associated Chambers of Commerce and Industry of India (ASSOCHAM) and Thought Arbitrage Research Institute (TARI).
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tralac’s Daily News selection: 22 October 2015
The selection: Thursday, 22 October
ECOWAS biometric ID cards due in 2016 (CitiFM)
Ghana is spearheading the Economic Community of West African States’ plan to provide Biometric Identification Cards to the community’s citizens in 2016. This is to facilitate the free movement of community citizens, goods and services in line with the revised ECOWAS treaty. Addressing participants in Tamale, the Director/Africa and Regional Integration and Head of the ECOWAS national unit of the Ministry of Foreign Affairs and Regional Integration, Mrs Sena Siaw-Boateng, reaffirmed ECOWAS’ commitment to create a single regional market for the free movement of goods.
Dr Dlamini Zuma promotes UK-China investment in Africa (AU)
The AU Commission Chairperson will present investment opportunities in Africa in line with Agenda 2063, particularly within growth-stimulating areas such as infrastructure development, human capacity development, energy and agriculture and agro-processing. The AU Commission Chairperson believes that these are prospective areas for collaboration between Africa, China and the UK. Hosted by the UK Trade and Investment in partnership with the Department for International Development , the principal objective of the event is, “to strengthen understanding of how the respective strengths of the UK and Chinese governments and private sectors can be most effectively combined, with the objective of stimulating investment and inclusive growth in Africa.”
China’s investment in Africa falls 84% as the slowdown bites (AFKInsider)
Chinese investment in Africa has fallen by as much as 84% in the first half of this year to $568 million compared to the same period last year when it invested more than $3.54 billion in Greenfield projects and other existing projects on the continent, the Financial Times reported.
Zimbabwe: Sino-Zim mega deals pick pace (The Herald)
A nine-member Chinese delegation arrived in Zimbabwe yesterday for site visits and meetings with senior Government officials as the implementation of the mega deals sealed last year intensifies. The delegation is led by the China International Trade representative Mr Zhang Xiangchen and includes director generals and deputy director generals of various Chinese government arms.
India to play catch-up with China at Africa trade summit (Mint)
India will push for early resumption of talks for proposed trade agreements with the Southern African Customs Union and Common Market for Eastern and Southern Africa groupings, which have remained stalled for last three years. India and the African countries are also likely to commit to work together for substantial outcomes in the Nairobi ministerial of World Trade Organization members in December, keeping in mind the developmental agenda of the Doha round of negotiations. Both sides may announce they will start work on a joint roadmap of cooperation to harmonize standards and regulatory regimes.
Keys to business success in Africa (Business Day)
It seems every South African company has an African strategy. Whether it is a few lines in an annual report, a statement at a results presentation or a comment to a journalist, many companies aver that they have a strategy for expanding into Africa. The reasons for this are obvious — stagnant growth in SA and a continent stretching north that seems to provide new opportunities to feed the voracious growth appetites of companies.
US firms set aside $4bn for business in Kenya (PR Newswire)
A number of high level US investors are expected to attend the upcoming Kenya International Investment Conference (KIICO) on 23rd-25th November, 2015 in Nairobi, following September's US Business Council for International Understanding meeting in New York, which resulted in $4 billion being set aside by US firms for business in Kenya. Arranged in collaboration with the East Africa Trade and Investment Hub – a flagship project under the presidential Trade Africa initiative – KIICO will highlight current investment opportunities across focus sectors of US interest, including agribusiness, ICT, apparels & textiles, leather and renewable energy sectors. [Kenya International Investment Conference due next month (CapitalFM)]
TradeMark to equip women entrepreneurs with EAC customs skills in $4.5m scheme (The East African)
The $4.5 million scheme by TradeMark East Africa will involve women traders from Kenya, Uganda, Rwanda, Burundi, Tanzania and South Sudan and run for about a year. “Targets include a 10% average increase in revenues of the targeted women exporters and traders, a 30% increase in the use of formal trade channels and systems by the women cross-border traders and the adoption of policies, regulations or practices that support an enabling environment for women,” the agency said. A second five-year phase is envisaged for 2017 with a $15 million budget committed to the effort.
Land disputes slow Northern Corridor project (The Standard)
The conflict between corporate and land laws among East African Community countries has been cited as the main barrier to the implementation of the Northern Corridor Integration Project. "The bureaucracy in political administration in the creation of these laws has stalled important projects. This may cause governments to be slapped with penalties on their loans, in addition to EAC member countries losing tax revenue,” the chairman of the East Africa Business Council, Denis Karera said when speaking at a private sector stakeholders’ forum in Nairobi on the NCIP.
Five Kenyan firms battle for Sh330m SGR steel deal (Business Daily)
DRC: Goma airport safety improvement project (World Bank)
Mozambique: Closure of international airports – another attempt to protect LAM (SPEED)
Kasumbalesa upgraded, proves effective (Times of Zambia)
South African Airways to commence flight to Abuja (National Mirror)
Government under pressure to revive Uganda Airlines (Daily Monitor)
IGAD: Declaration of the regional consultative meeting on El Nino impact prevention
“The effects of El Nino are already perceived in some parts of some of our member states. I am convinced that we are in a position to provide a better response compared to some time back as we have been working altogether in building resilience to drought these last couple of years”, he said. According to Ambassador Mahboub, experience gained in drought resilience should benefit in this case of El Nino risk reduction through effective coordination mechanisms and pooling of resources. He also reminded the audience that disasters brought by natural phenomena such as El Nino for instance, contributed directly or indirectly to peace and stability as well as to migration issues. Mr Pete Manfield, from the UN Office for the Coordination of Humanitarian Affairs, said: “drought conditions already persist in Sudan, Eritrea, Djibouti and primarily in Ethiopia” while “excessive rain in parts of the region, primarily in Somalia, Kenya and Uganda could lead to widespread flooding, directly affecting up to a further 2 million people”. [Declaration]
The strongest El Nino in decades is going to mess with everything (Mint), El Niño strikes Ethiopia (NYT), East Africa countries seek funds to curb El Nino effects (Global Post), Building climate resilience in the Limpopo Basin: EOI (AfDB)
Botswana’s annual steel import bill at P775m (Mmegi)
Botswana's steel import bill stands at P775 million annually but the establishment of the Pula Steel Manufacturing and Casting Plant will reduce the need to buy from outside, Vice President Mokgweetsi Masisi has said. Officially launching the factory, Masisi said local steel demand last year was met primarily by South Africa and China. According to international trade statistics, SADC imported P36 billion worth of steel in 2014 and the local demand amounted to P775 million.
Private sector development in fragile situations: EOI (AfDB)
The AfDB invites individual consultants to indicate their interest in the following assignment: Private Sector Development in Fragile Situations. The consultant will be expected to provide the following services under the Assignment, among others:
Kenyan flowers account for 7% of global production (The Standard)
South Africa stone-fruit growers see record exports in season (Moneyweb)
SA’s credit rating at risk? (Business Report)
Vodacom sale proceeds to fund SA’s first BRICS Bank payment (Business Day)
Building Asia’s new bank: audio of an address by Jin Liqun (Brookings)
Rethinking development strategies after the financial crisis: making the case for policy space (UNCTAD)
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India to play catch-up with China at Africa trade summit
Govt will seek to push for early resumption of talks for proposed trade pacts with regional bodies in that continent
India will play catch-up with China in attempts to reach out to resource-rich Africa on Friday when it hosts ministers and senior officials from 30 out of 54 African countries during the fourth India-Africa trade ministers’ meeting on Friday.
India will push for early resumption of talks for proposed trade agreements with the Southern African Customs Union (SACU) and Common Market for Eastern and Southern Africa (COMESA) groupings, which have remained stalled for last three years.
A government official speaking under condition of anonymity said while 26 trade ministers have confirmed participation, another four countries will be represented by trade ministry officials.
The meeting will lay the ground for the India-Africa forum summit of heads of African governments on 26-30 October. The industry department will also host an India-Africa business council meeting on Friday.
Established in 1910, SACU is the oldest customs union, comprising South Africa, Namibia, Botswana, Lesotho and Swaziland. India and SACU started negotiations on a preferential trade agreement in 2005 following the India-South Africa Joint Ministerial Commission. A so-called memorandum of understanding was signed between the two in 2008 to facilitate the negotiations. While India sought a tariff reduction in 30-50% of goods, the grouping is ready to offer only 10% of total traded goods.
COMESA was established in December 1994 as an organization for economic prosperity through regional integration among the 19 member countries. India has not made much progress in negotiations for a free trade agreement with COMESA due to low level of ambition.
India is also closely watching the tripartite free trade agreement (TFTA) signed among African countries in June for greater economic engagement.
TFTA is a proposed free trade agreement between COMESA, the Southern African Development Community and the East African Community, representing 26 African economies worth $1 trillion and 600 million people.
The official said trade ministers will also review the status of some of the institutions which were to be established, like the India Africa Institute of Foreign Trade in Uganda and the India Africa Diamond Institute in Botswana. “The Indian Institute of Foreign Trade and Indian Diamond Institute will set up campuses in Africa to run training programmes for capacity building. India will partly finance the setting up the two institutions with an investment of around Rs.80 crore,” the official said.
India and the African countries are also likely to commit to work together for substantial outcomes in the Nairobi ministerial of World Trade Organization members in December, keeping in mind the developmental agenda of the Doha round of negotiations.
“We will also discuss future possible collaborations. We need more clarity on the areas of cooperation which we hope will emerge from the meeting of the ministers,” he added.
Both sides may announce they will start work on a joint roadmap of cooperation to harmonize standards and regulatory regimes.
Africa is considered the next growth frontier and is already an important trade partner for India. Trade with Africa increased from $39 billion in 2009-10 to $71.4 billion in 2014-15, with exports rising faster than imports.
Both sides may announce a target of doubling bilateral trade to around $145 billion by 2022.
India’s key export interests are in processed petroleum products, drugs and pharmaceuticals, and motor vehicles. Crude petroleum is the biggest imported item from Africa, followed by gold, coal and other mining products.
India became the first developing country to extend a duty-free, quota-free facility to the world’s least developed countries (LDCs), which will benefit 21 such countries from Africa. It has also said it will provide preferential treatment in services trade to LDCs ahead of the Nairobi ministerial meet of the WTO in December where the decision is expected to be notified.
Biswajit Dhar, professor at the Indian Institute of Foreign Trade, said the meeting of the trade ministers should present an opportunity for exploring different avenues for future engagement. “Africa is the continent of the future. This meeting is an important stepping stone for deepening economies ties between both sides,” he added.
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ECOWAS Biometric ID Cards due in 2016
Ghana is spearheading the Economic Community of West African States’ (ECOWAS) plan to provide Biometric Identification Cards to the community’s citizens in 2016.
This is to facilitate the free movement of community citizens, goods and services in line with the revised ECOWAS treaty.
The Ministry of Foreign Affairs and Regional Integration, is organizing series of workshops across the country to sensitize relevant stakeholders and the general public on the ECOWAS protocol arrangements.
Addressing participants in Tamale, the Director/Africa and Regional Integration and Head of the ECOWAS national unit of the Ministry of Foreign Affairs and Regional Integration, Mrs. Sena Siaw-Boateng, reaffirmed ECOWAS’ commitment to create a single regional market for the free movement of goods.
“The West African region has defined its priorities with regards to integration in economic and trade matters. These priorities are the creation of a single regional market for the free movement of goods of ECOWAS origin as well as the introduction of ECOWAS Biometric ID Cards to facilitate free movement of community citizens.”
“The main objective of ECOWAS is to promote co-operation and integration of the national economies and accelerate the economic development of member states in order to improve the living standards of the people. The creation of a single market is largely dependent upon our ability to establish a free Trade Area, Common External Tariff and Customs Union,” she explained.
Mrs. Sena Boateng however observed that some community citizens are ignorant of the integrative arrangements.
“Ghana has an enviable record where African integration is concerned. She has always been at the forefront of the efforts made towards integration both at the sub regional and continental levels: one major observation however is that, ordinary citizens are usually not aware of ongoing integrative arrangements and they do not form part of the process.”
She thus entreated the mass media to highlight ECOWAS’ transformational agenda.
“It is therefore important that you from the public sector and the media are sensitized and informed so that you will feed the populace with accurate information about ECOWAS, its achievements and challenges,” Mrs. Sena underscored.
The Northern Regional Minister, Alhaji Mohammed Muniru Limuna, lauded the workshop’s theme dubbed, “Enhancing public sector participation in regional integration (ECOWAS).”
He called for concerted efforts to consolidate ECOWAS’ success on the implementation of the macro-economic convergence criteria and effective surveillance mechanism.
Alhaji Limuna urged the participants to take advantage of the workshop and deepen their knowledge on the workings of ECOWAS and regional integration.
The Northern Regional Commander of the Ghana Immigration Service, Eric Afari, said personnel of his outfit are committed to the ECOWAS protocol on free movement of people.
The Assistant Director of Immigration said, “We want to once again re-emphasize the commitment to ECOWAS protocol and engender the fact that we need to do everything as a people and as public officials to push for the full realization of the objectives of ECOWAS.”
“On our part as immigration officers, we are supposed to implement the protocol on free movement of persons, residents and establishments, and its important that we once again commit ourselves to this course,” Mr. Afari stressed.
Logistics inadequacy
Mr. Afari called for enough logistics to fast track the movement of personnel of the Border Patrol Unit of the Ghana Immigration Service, who constantly police some unapproved entry routes into the country.
“We have the Border Patrol Unit that has been created within the Ghana Immigration Service since 2006. What is left now is for the unit to be empowered so that they can give out their very best.”
He revealed, “The Border Patrol Unit personnel are not armed and it makes it a bit difficult because these are trans-national organized criminals and they come very sophisticated. In the face of the challenges we are doing our very best.”
Mr. Afari gave the assurance that the service will flush-out foreign illegal miners operating in the country.
The workshop brought together participants from the nation’s law enforcement agencies, the media, public servants and a cross section of the general public.
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China slowdown sees investment in Africa plummet 84%
The slowdown in the world’s second-largest economy has seen Chinese cross-border investment in Africa plunge.
Beijing has invested just $568 million in greenfield projects and expansion of existing projects in the first 6 months of 2015, down from $3.54 billion the previous year. That investment has been focused on China’s primary interest in Africa, namely its raw materials, writes Adrienne Klasa for The Financial Times.
Foreign direct investment plummets, trade still strong
While overall investment plunged, investment in extractive industries almost doubled from $141.4 million to $288.9 million over the period. Chinese investment in Africa has at times been controversial, but has played a major role in regional growth.
The African growth story has been complicated by global headwinds such as low prices of oil and other commodities. Many African states rely on raw materials for large parts of their revenues.
Although foreign direct investment has fallen, China has been Africa’s main trade partner since 2009. In 2013 there was more than $170 billion in trade between China and sub-Saharan Africa, compared to less than $10 billion in 2002.
“FDI has dipped across the board from emerging markets into other emerging markets, and into Africa in particular,” says Vera Songwe, the IFC’s director for West and Central Africa. FDI reflects changing patterns of investment.
Evolving relationship between China and Africa
There are some concerns that a bursting Chinese real estate bubble could see demand for African raw materials reduce even further. This could have a knock-on effect on investment in the sector, and in Africa in general.
However other economists believe that opportunities could present themselves. “Is China now going to relaunch internal demand, in one way or another? If this is the case, the demand at least in volume in natural resources can even increase,” says Mario Pezzini, director of the OECD’s Development Centre.
Although China may start to look inward, there could be the potential for internal demand in Africa due to demographic trends. Within 35 years the population of the continent is set to reach 2 billion, accompanied by the fastest rate of urbanization in the world.
According to Ms Songwe, Internal growth may be driven by real estate development and housing, with the sector able to absorb production that previously focused on China. “The question is now turning towards looking at internal demand, which is what China is doing as well,” she says.
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US firms set aside $4 billion for business in Kenya in lead up to high profile investment conference
A number of high level US investors are expected to attend the upcoming Kenya International Investment Conference (KIICO) on 23rd-25th November, 2015 in Nairobi, following September’s US Business Council for International Understanding meeting in New York, which resulted in $4 billion being set aside by US firms for business in Kenya.
The move comes following President Obama’s homecoming visit to Kenya in July 2015 and as over 90 US companies currently explore business opportunities in the East African country; which boasts strong economic fundamentals, and the region’s largest GDP.
Arranged in collaboration with the East Africa Trade and Investment Hub – a flagship project under the presidential Trade Africa initiative – KIICO will highlight current investment opportunities across focus sectors of US interest, including agribusiness, ICT, apparels & textiles, leather and renewable energy sectors.
Speaking at the KIICO 2015 launch, Phyllis Kandie, Cabinet Secretary of the Ministry of East African Affairs, Commerce and Tourism, said:
“Kenya is a model investment destination for global firms, and we are committed to working with US companies eager to grow and expand their business in East Africa. In recent years, we have facilitated significant growth in US interest in doing business in Kenya, with senior government level commitments to further developing bi-lateral trade and investment ties between our two nations. This year’s KIICO is set to showcase the scale of opportunity on offer to Americans in one of Africa’s fastest growing economies.”
A global event now in its second year, KIICO has solidified Kenya’s reputation as the region’s top meeting place for companies and investors eager to grow their business and make proven returns on investment in East Africa. Connecting business leaders from international and local markets, KIICO 2015 is expected to draw in 1,500 local and international delegates.
Dr. Moses Ikiara, Managing Director of the Kenya Investment Authority said, “Kenya is attracting a multitude of global investors and over the past 12 months, we have seen a marked rise in interest in the agribusiness, ICT, apparels & textiles, leather and renewable energy sectors. To facilitate this interest, KIICO 2015 is highlighting these key growth sectors, as we aim to encourage businesses to ‘Think Investment – Make It Kenya’ – the central theme of this year’s conference.”
“With a streamlined focus for this year’s KIICO, we foresee a high uptake of investment opportunities in 2015 and beyond,” concluded Ikiara.
Alongside KIICO and as part of the country’s Make It Kenya campaign, Kenya continues to roll out a series of measures to enhance the ease and cost of doing business, with the Kenya Investment Authority (KenInvest) taking major steps to build positive investor sentiment in the US.
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tralac’s Daily News selection: 21 October 2015
The selection: Wednesday, 21 October
African, Caribbean and Pacific Ministers of Trade meeting yesterday in Brussels: selected updates
Opening statement by Minister Joshua Setipa (Lesotho)
When the current WTO Round was launched, it was referred to as the Doha Development Agenda, because it promised to deliver on development. So far that development promise has eluded us and has proved to be a mirage. Bur we have to keep on keeping on, pushing for our interests and to have our concerns fully addressed. We are concerned that some Members are even calling for the DDA to be abandoned altogether. We need to discuss how to respond to such calls. The European Union, our key development partner is currently debating its future trade and investment policy. Part of the strategy that the EU has outlined is a welcome proposal to reinvigorate the multilateral trading system. But there is also the idea of, and I quote, “turning the page on the DDA”. How will this be done?
ACP trade ministers ‘concerned’ with preparations for upcoming WTO ministerial (ACP)
Roberto Azevêdo: Africa can be biggest winner of MC10 (WTO)
The Director-General gave a frank assessment of the current situation: “But just as important as any deliverables in Nairobi will be the direction of our work after Nairobi. There are big decisions to take about the future of the system. We have to ensure that the WTO continues to be operational, so that developing countries continue to have a seat at the table. I urge African members to get involved in this conversation now.”
EU Commissioner for Trade, Cecilia Malmström meets ACP Ministers (Europa)
"This is a critical time for the WTO", said Commissioner Malmström. "I really wish for the EU and ACP countries to stand side by side in trying to steer the discussion towards tangible results. Expanding opportunities to trade through the multilateral system is crucial to foster development and prosperity.”
@AMB_A_Mohammed: The meeting also examined and adopted the ACP Declaration on the outcome of MC10
CS Amina rallies Africa for success of Nairobi WTO Conference (CapitalFM)
South Africa: October stands firm behind controversial investment bill (Business Day)
Department of Trade and Industry director-general Lionel October has defended the department from fresh claims that the Promotion and Protection of Investment Bill was ill thought out and that it placed SA at risk of international litigation. The proposed bill seeks to provide a harmonised and standard legislative framework to govern investments, replacing bilateral investment treaties that the government has terminated. Mr October said in an interview that critics of the Bill who argue it contradicts SA’s obligations under the Southern African Development Community’s finance and investment protocol, have their facts wrong.
Chinese government pledges $50bn to industrialise South Africa, African continent (GCIS)
The Chinese government reiterated its commitment to support industrialisation in South Africa and the rest of the African continent by pledging $50 billion towards industrialisation projects. The pledge was announced during a courtesy visit by the Vice Minister of Commerce of China, Mr Zhang Xiangchen to the Director-General of the Department of Trade and Industry, Mr Lionel October in Pretoria. “China-Africa industrialisation partnerships will be at the forefront of any development in the continent followed by agricultural activities. China will also increase investments in Africa especially in the Special Economic Zones and provide training in those sectors,” said Xiangchen.
BRICS industry ministers meet in Moscow (BRICS Post)
BRICS industry ministers held their first meeting in Moscow on Tuesday. Officials from the five countries discussed “new opportunities for growth” and “collaborative multilateral infrastructure projects”, said a statement. “BRICS New Development Bank which has already started the selection of next year’s priority projects, will contribute in attracting investment in joint projects in a wide range of industries,” said Minister of Industry and Trade of Russia Denis Manturov. Russia has worked out a ‘roadmap’ on boosting intra-BRICS trade ties through till 2020, the minister said. It includes projects in manufacturing, mining, engineering, energy and many other sectors of the economy. The Russian Trade Minister during Tuesday’s meet also urged governments to eliminate trade barriers between the BRICS countries and the members of the Russia-led Eurasian Economic Union.
World Export Development Forum 2015: keynote address by Ms Valentine Rugwabiza (ITC)
Deeper and closer integration of economic communities such as the Gulf Cooperation Council and the East African Community will open up new trade and investment opportunities to encourage sustainable growth, thereby creating new jobs and prosperity for millions. However, this will not be easy given the challenging reality we are confronted with.
State corruption slowing business growth, Kepsa warns (Daily News)
The private sector wants the government to urgently address what its members feel are high levels of State corruption which are impeding the growth of their businesses. Kenya Private Sector Alliance (Kepsa) members told Treasury Cabinet Secretary Henry Rotich that unprecedented levels of graft particularly in state procurement were standing in the way of business despite a general improvement in business environment in the country. The members were speaking at a stormy closed door meeting held Monday between the government and business community.
Endemic collusion in the South African construction sector: reasons and implications (OECD Global Forum on Competition)
The paper analyses the number of cartel cases that have been considered and the value of cartel penalties that have been imposed by the Competition Tribunal and the Competition Appeal Court since the first administrative penalty was imposed. From this it concludes that until recently collusion was endemic in the industry. The paper then discusses the possible reasons for this and the implications for the future enforcement of competition law in South Africa. [The author: This paper by Robert Wilson, partner in the Competition Practice at Webber Wentzel, Johannesburg]
International comparison of South African private hospitals price levels (OECD Health Working Paper)
In summary, private hospital prices are expensive relative to what could reasonably be predicted given the country’s income and are likely to be expensive even for individuals with higher levels of income. However, the findings have implications far beyond the personal budgets of the fraction of the population that can afford them, as they set benchmarks for how much the public sector has to attract medical specialists to work in the public sector. This study suggests that policies to control price increases while ensuring accessibility and quality are needed. There is scope to improve the value provided to South Africans for their considerable spending on health care.
The Greater Horn of Africa region to prepare for El Niño impact (IGAD)
The main objectives of holding the regional consultative meeting are to provide forecast updates based on the expected strengthening of El Niño, its likely impacts and mitigation recommendations with relevant decision makers from the Member States, and to share the status of preparedness by the Member States. The organizers will also use the opportunity to facilitate national and regional climate experts to create awareness of key actors in the various sectors regarding the use of climate outlook products. A final communiqué on the Preparation for Early Action on the Impending El-Nino Impact on Member States is expected to be released.
Second Committee debate on disaster risk issues (UN)
Terrorism and climate change go hand in hand in delaying, and in some cases destroying, development gains, the Second Committee (Economic and Financial) heard today as it concluded its discussion on sustainable development. Antonio Gumende (Mozambique), associating himself with the Group of 77 and the African Group, stated that the Sendai Framework for Disaster Risk Reduction 2015-2030 had the merit of being multidisciplinary, comprehensive and people-centred, and should guide the collective efforts of the international community to better address disaster preparedness. His country was extremely vulnerable to natural disasters and the Government had approved a master plan for preventing and mitigating their effect, that involved measures such as simulation exercises focusing on floods and cyclones and activation of an early warning system.
Namibia: Farmers urged to plan for drought (New Era)
Commodity Markets Outlook: understanding El Niño (World Bank)
SADC: AfDB to conduct regional broadband study (NewsDay)
The African Development Bank has commissioned a study on infrastructure and broadband aimed at finding ways to improve the regional ICT infrastructure, an official from the Southern African Telecommunications Association has said. Currently, SATA is holding its workshop on regional ICT Infrastructure in Zimbabwe. The association will today present preliminary findings of the study to SADC representatives. The AfDB study began last month and is expected to be completed by December this year.
Transform Africa conference: Develop relevant business models, ICT firms told (New Times)
Growing digital lifestyle and technology uptake across the African continent will require corporations to have new business models that create value for consumers at the same time have valuable revenue streams, industry experts say. Speaking at the ongoing Transform Africa 2015 forum, players in the ICT sector said for corporations and start-ups to make the most of the technology uptake, the new operating models will require provision of unique digital content, exceptional customer experience and superior digitised platforms. The second edition of Transform Africa Summit in Kigali, which closes today, has attracted more than 2,500 delegates from more than 80 countries and 80 firms to deliberate on how to advance a more digital Africa. [Calls between Uganda and Rwanda up by 800% (New Vision)]
BOBS urges firms to establish local standards (Mmegi)
Botswana is forced to rely on international companies’ standards because it was rare to get locally founded standards, a senior standards scientist at the Botswana Bureau of Standards, Poppy Kgabung said. Speaking at the World Standards Day commemoration here last week, Kgabung said if local companies did not have standards in place, government is compelled to source base materials from international bodies like the South African Bureau of Standards.
Migration governance and migrant rights in SADC (UNRISD)
Attempts at regional coordination and harmonization of migration governance have made limited progress and continue to face formidable challenges, although recent developments at national and regional levels show some promise. In conjunction with the 2003 SADC Charter of Fundamental Social Rights and 2008 Code on Social Security, incorporation of migrants into the SADC 2014 Employment and Labour Protocol could signal a shift towards more rights-based migration governance. The paper concludes by arguing that there can be no robust rights regime, either regionally or in individual countries, without extension of labour and certain other rights to non-citizens, nor a robust regional migration regime unless it is rights-based. [The authors: Belinda Dodson, Jonathan Crush]
Ethiopia leads in honey production in Africa (COMESA)
Currently COMESA contributes less than 5% of global honey production which is estimated to be 1.7 million tonnes annually. The region produces about 82,000 tonnes annually with Ethiopia contributing 45,000 tonnes; Kenya, Egypt and Madagascar follow with 12,000 tonnes, 5,100 tonnes and 4,400 tonnes respectively. Ethiopia also leads the African continent followed by Tanzania, Angola and the Central African Republic. It is estimated that less than 3% of the honey produced in COMESA enters the international markets partly because of food quality standard requirements in the developed countries.
High-level Conference on Feeding Africa: an action plan for African agriculture transformation (AfDB)
Ethiopia: Second Growth and Transformation Plan consultation
Tanzania’s Sh1 trillion port project threatens Mombasa hub status (Business Daily)
Zimbabwe: ATI treaty gets Parly thumbs-up (The Herald)
Museveni in trade, security talk with Algeria’s Bouteflika (Daily Monitor)
Bharti Airtel raises $400 million more from sale of Africa assets (Mint)
ASEAN regional non-tariff measures workshop (UNCTAD)
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CS Amina rallies Africa for success of Nairobi WTO Conference
Foreign Affairs Cabinet Secretary Amina Mohamed has urged African countries to join hands in pushing for successful and favorable outcomes at the WTO Ministerial Conference – dubbed MC10 – that will be held in Nairobi in December.
At the same time, the Cabinet Secretary said the WTO Conference in Nairobi, the first in the African continent, is an historic opportunity for Africa to infuse the African perspective in shaping the future of international trade through a fully functioning multilateral trading system.
Addressing an informal meeting of African Union Trade Ministers in Brussels, Monday, CS said conversations are still continuing in negotiating bodies in Geneva with a focus on those elements that can become part of a possible package of deliverables for Nairobi MC10.
Noting that the exact content of the package is yet to be determined, the CS said the contours of deliverables were beginning to emerge and called on African countries to be proactive, decisive and smarter in the ongoing WTO negotiations.
Acknowledging that difficulties in progressing negotiations on key issues remain, Amb. Amina Mohamed stressed the need for Africa to have a unified voice on issues of interest to the continent.
“We have to be coherent as a region and closely coordinate with our delegations in Geneva and with each other in our capitals. For Nairobi to be a success, we – as Africa – have to be heard. We therefore have to speak as one united Africa,” said the CS.
Amb. Amina Mohamed called on African countries to work together towards an outcome that has a strong developmental component for the continent adding that a successful outcome should include a Nairobi work programme that is realistic, balanced and that also modernizes the WTO negotiating agenda.
“The work programme would need to include agriculture, comprising an outcome on cotton; an understanding on food security; services; NAMA; trade and environment; fisheries subsidies; an expanded information technology agreement and a package for LDCs,” said the Cabinet Secretary.
Amb. Amina Mohamed further stressed the importance of the Trade Facilitation Agreement and urged African countries to work together to ensure it comes into force in Nairobi during MC10.
Noting that MC10 was only a few weeks away, Amb. Amina Mohamed stressed that parties’ to the WTO negotiations can no longer afford to keep on discussing issues in general terms.
“It is time to begin talking concretely about the details of a possible outcome through text-based negotiations. Africa should collectively front proposals which are doable, pragmatic and manageable,” said Amb. Amina Mohamed.
Saying that success in Nairobi is success for Africa, the Cabinet Secretary said the WTO Conference offers a unique opportunity for Africa to realize the development goals that the continent has been seeking for more than a decade.
“Being the region with the highest number of LDC Members and comprised mostly of developing countries, we should think about how the WTO would best function in satisfying the developmental needs of our people,” said the CS.
“We need to start thinking about how we could use the WTO as a platform to further integrate our economies to international trade and reap its benefits,” added Amb. Amina Mohamed.
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Transforming Africa’s agriculture for growth and development: Delegates converge on Dakar for landmark conference
Delegates from across the globe are converging on Dakar, Senegal, for a landmark conference on agriculture that promises to yield one of the boldest initiatives ever taken on Africa’s development.
Some 400 participants including Finance, Planning, Economy, Agriculture, Rural Development, Trade and Industry Ministers as well as Central Bank Governors are joining business leaders, academia, investment agencies, civil society and global experts in Dakar from October 21-23, to discuss the future of Africa’s agriculture.
The conference on “Feeding Africa” is jointly organised by the African Development Bank and the Government of Senegal. Participants will review the key challenges to Africa’s agricultural transformation, articulated by AfDB President Akinwumi Adesina as a key priority for reducing poverty and hunger as well as for spurring growth and creating jobs on the continent.
On assumption of office on September 1, Adesina spoke fervently of the need for Africa to feed itself, noting that it was “inconceivable that a continent with abundant arable land, water, diverse agro-ecological richness and sunshine should be a net food-importing region. Africa has 65% of all the arable land left in the world, which can help meet the food needs of 9 billion people on the planet by 2050,” he said.
Africa’s agricultural transformation is one of the five priorities that he laid out to drive the Bank’s development agenda in the coming years: “Light up and Power Africa. Feed Africa. Integrate Africa. Industrialize Africa. Improve quality of life for the people of Africa.”
President Adesina is expected to further articulate his vision for the continent at the opening ceremony of the Dakar conference to be chaired by President Macky Sall, who will also give a keynote address. The Prime Minister of the Democratic Republic of Congo, Augustin Matata Ponyo Mapon, will also be in attendance, while World Bank President Jim Yong Kim, Kofi Annan and Jeffrey Sachs will join the conference by video.
It goes without saying that for a continent where agriculture provides about two-thirds of employment and accounts for about two-thirds of the world’s arable land, the sector cannot continue to operate at subsistence levels especially when it is realised that the continent spends US $35 billion on food imports each year while a quarter of its population suffer from hunger or malnutrition. Firm commitment by governments would make it possible to leverage the missing agricultural food value chains that link producers, processors, marketers, food service companies, retailers and supporting groups such as shippers, research groups and suppliers.
The Dakar conference will seek strong commitments form governments to undertake the necessary steps towards Africa’s agricultural transformation. These include prioritizing agriculture, renewing private-sector engagement and engaging in innovative agriculture financing mechanisms. Participants are expected to focus on issues such as the modernization of the sector, access to credit for women, and young farmers.
The goal is to transform Africa’s agriculture into a thriving business adequately providing for the continent’s food needs and at the same time capable of feeding a lucrative export market. Participants say it would be possible for the conference to produce a blueprint that would make this happen given the range of expertise and doyens in global agriculture and food business expected to be in attendance.
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World Export Development Forum 2015: Keynote address by Ms. Valentine Rugwabiza, Minister for East African Community Affairs
Keynote address by Ms. Valentine Rugwabiza, Minister for East African Community Affairs (Rwanda), at the World Export Development Forum (WEDF) 2015, 20 October – Doha, Qatar
First of all, I wish to thank ITC and the State of Qatar – co-organisers of this year’s edition of the World Export Development Forum (WEDF). The theme “Sustainable trade: Innovate, Invest, and Internationalize” is a timely and relevant theme for many of us in this room, which I will focus on shortly. Thank you Arancha Gonzalez for the honour of this invitation to address this audience. I also wish to thank the Ministry of Finance of the State of Qatar and the Qatar Development Bank (QDB) for co-hosting this year’s World Export Development Forum. Thank you for your kind hospitality. It is a real pleasure to be in Doha.
Last year, the World Export Development Forum took place in Africa for the first time, hosted by my own home country, Rwanda! Today, we are hosted by Qatar – a country with a remarkable identity and impressive economic growth.
The focus of last year’s Forum was on unlocking the potential of Small and Medium-sized Enterprises and supporting employment through trade. SMEs are at the heart of economic activity in any nation of the world – from G20 countries to the Gulf Cooperation Council, to Least Development Countries. SMEs are the grassroots of economic activity and key to a country’s economic transformation and to achieving prosperity.
For SMEs, sustainable business models are essential, and their success is underpinned by innovation – which is not merely technological but encompasses new forms of raising capital and policy design – all nurtured by adequate investments.
This Forum comes at a timely moment. Its focus on sustainability resonates with the newly agreed upon Sustainable Development Goals. The newly agreed SDGs lead us in the right direction in terms of maintaining our focus on long-term gains from economic and social development, to be equitably shared. The links between trade and growth are known and well-established. But, while we still work and strive towards balancing our annual accounts and economic targets in the short run; the SDGs invite us to focus on the mid to long-term horizon. What this tells us is that deeper integration of our communities through investment in innovation, inclusiveness in connectivity – are central to our sustainable growth and development.
Deeper and closer integration of economic communities such as the Gulf Cooperation Council and the East African Community will open up new trade and investment opportunities to encourage sustainable growth, thereby creating new jobs and prosperity for millions.
However, this will not be easy given the challenging reality we are confronted with. For example, the International Labour Organization tells us that youth today are three times more likely to be unemployed than adults, and almost 73 million young people worldwide are currently looking for a job. We cannot allow this potential, energy, and these lives to continue unfulfilled. On gender equality for economic opportunities, we must remember that not only is it a matter of social justice, but it is something that makes perfect sense from an economic standpoint. A recent report by the McKinsey Global Institute estimates that achieving full gender equality in economic participation would increase global GDP by 26 percent in ten years’ time – approximately the size of the US and Chinese economies combined. I see these figures as the perfect example of how “sustainability” does not slow economic growth. On the contrary, it strengthens it.
In all this, one constant necessity is regional integration. The reality of today’s globalised world calls for a move away from the atomistic model of nations competing against each other. In an increasingly interconnected world characterised by strong competition in product and service markets as well as in attracting foreign capital, countries and economic communities today need to come together. While we have seen the rise of truly global value chains in the past two decades, integration cannot happen merely through business contracts. This does not mean I do not believe in the vital role played by the private sector in building a strong regional economy.
Quite the opposite, I have always welcomed the inclusion of private sector players in the policy debate. However, legal and physical barriers still hinder the potential for global growth, and it is the responsibility of all of us policymakers to remove those barriers. Allow me to highlight various achievements within the East African Community, which are a concerted effort between policy makers and the private sector to remove barriers to integration.
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Within the EAC, there exists free movement of Goods, people, labor, services and capital across borders. This is made possible by the use of IDs and Voter cards to travel across the 3 countries;
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The use of a Single Tourist Visa within the EAC has boosted tourism significantly;
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One Area Network (soon to include data and mobile money) is facilitating increased communication and transactions across the region.
I am here with you today not only to speak of sustainable growth, SME development, and gender equality as vague, abstract concepts. I am also here to tell you a story, of which I am a part, together with colleagues here as well as millions of other East Africans. It is a story of how far we have come following an ideal of development and inclusion that is not dissimilar to what we are discussing in this Forum. Allow me to share the experience of Rwanda and of the East African Community in shaping a sustainable growth model through openness and cohesion.
Rising from the ashes of the old East African Community which collapsed in 1977, today’s EAC benefits from strong support at all levels, from policymakers to citizens in every Partner State, and importantly, active private sector and civil society engagement. The idea of African unity is still strongly embedded in the Community’s vision, founded on the principle of “one people, one destiny”.
We have also made great efforts to be very pragmatic. These efforts have paid off quite well. The EAC is the fastest growing regional bloc in Africa in the past decade and is well onvtrack to continue this trend. Partner States consistently appear in the top positions in Africa and globally for governance, doing business, competitiveness, financial inclusion, and inclusive growth. We have built strong institutions making them accessible to citizens and designing them mindful of lessons from other regional blocs.
Rwanda’s accession to the EAC and its Customs Union revolutionised the country’s trade patterns. We extended the preferential trade regime to all our neighbours, thereby reallocating trade flows according to efficiency and strengthening ties with Uganda and Tanzania in particular. Today, the EAC is Rwanda’s largest trading partner, and the whole region is well above the average in its contribution to intra-African trade.
Additionally, Rwanda and the region have projected themselves towards the Gulf and Middle Eastern markets. Recent links to Dubai and engagement with the Gulf Cooperation Council are the result of an export-oriented mindset and a pragmatic approach to consolidate our global presence and attract further investment.
The EAC is a relatively new player in the global dynamics of trade, investment, and policy. Let us be honest – challenges remain and we confront them regularly. The lack of competitiveness of certain sectors of the economy will need to be addressed as part of our efforts to achieve sustained growth and middle-income status. We know what needs to be done: invest in infrastructure, raise health and education standards, create deeper and more innovative financial markets, diversify exports and invest in SMEs. While there is no recipe on how to achieve these outcomes; an essential ingredient is closer and deeper integration among Partner States.
With a range of policy instruments already in place and others currently being developed, the EAC is eager to promote exports at all levels, from multi-million dollar companies to small informal traders. While we as policymakers try to satisfy the needs of the private sector, we also focus on improving the livelihoods of those communities where trade is a way of life.
Small-scale traders from border communities throughout the region now benefit from what is called a Simplified Trade Regime. This regime supports the very people whose livelihoods depend on exports. Given that most of these traders are women (approximately 75%), we have a unique opportunity to facilitate income-generating activities and couple them with social and economic equality for women.
Rwanda and the EAC have come a long way in opening to the world and building a sustainable growth path. I would like to borrow some words from HE the President of the Republic of Rwanda, when he gave a speech at the opening session of last year’s Forum.
“We should always believe in ourselves and be convinced that ultimately it is us who hold the key to our own development. And we should see competition as an opportunity to measure ourselves against the world, rather than a problem.” Rwanda will continue walking along its development path convinced that regional integration is a platform to emerge in the world rather than a burden, and we continue to work hard to leverage our individual strengths and fulfil our potential.
The breadth, depth and pragmatism of our discussions and solutions envisaged here in Doha should mark the implementation of SDGs, for, by and with businesses. Only implementation will bring about the lasting transformation we collectively enshrine and have put in motion.
I thank you.
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Qatar’s Prime Minister opens the World Export Development Forum in Qatar
Policymakers and business leaders meeting in Doha to discuss global trade, investment and development
His Excellency Sheikh Abdullah Bin Nasser bin Khalifa al-Thani, Prime Minister and Minister of Interior of the State of Qatar, on 20 October 2015 opened the World Export Development Forum (WEDF), which is taking place in Doha, Qatar. More than 700 people from 92 countries are attending the event, which is organized by the International Trade Centre (ITC) and hosted by the Ministry of Economy and Commerce of the State of Qatar through the Qatar Development Bank.
Opening WEDF, Prime Minister Abdullah Bin Nasser bin Khalifa al-Thani told the audience that the sustainability of international trade flows must go hand-in-hand with significant investment efforts, as well as innovative policies and appropriate institutional arrangements. ‘Whether we want it or not, continuing to fulfill our countries’ economic development potential will demand from all of us the courage and vision to adapt our existing policy frameworks to better deal with economic and social change everywhere,’ he said.
ITC Executive Director Arancha González said that more open trade and investment – and especially more competitive small and medium enterprises (SMEs) – can help the world generate sustainable and inclusive growth and reach the Global Goals for Sustainable Development, which were agreed by world leaders at the United Nations last month.
‘Sustainable, because growth needs to be compatible with our planet; and inclusive because growth must work for all, including for youth and women,’ she said. ‘This must be growth anchored in SMEs, which represent 90% of all businesses worldwide and which generate seven of every ten jobs.’
‘Supporting SMEs to internationalize and helping them connect to markets or tap into value chains are key to fostering more dynamic and innovative economies and ensuring growth is sustained and sustainable,’ she said.
His Excellency Sheikh Ahmed Bin Jassim Al Thani , Minister of Economy and Commerce, said that Qatar has embarked on a path towards more sustainable growth, diversifying the economy away from hydrocarbons, pointing out that the non-hydrocarbon sector now accounts for more than 50% of the country’s economy.
‘We need to have a solid and sustainable export-oriented private sector,’ said Sheikh Ahmed Bin Jassim Al Thani. ‘Achieving this will greatly reduce our economy’s inherent exposure to international markets, an area that we now actively manage both at the micro as well as the economy-wide level.’
Abdulaziz Al Khalifa, CEO of QDB, said: ‘For Qatar, it is an honour to host WEDF, which has become a leading platform for policymakers to talk and do business. It is also recognition of Qatar as a bridge, linking continents together through trade.’
‘SMEs play a leading role in Qatar’s ongoing diversification efforts. WEDF allows us to strengthen this work by sharing ideas and learning from others. It also provides an ideal platform to shine a spotlight on how SMEs can contribute to inclusive growth by building linkages with foreign companies and connecting to value chains,’ he said.
‘Sustainable trade: Innovate, invest, internationalize’ is the theme of this year’s WEDF, which comes on the heels of the adoption by world leaders of the Global Goals for Sustainable Development. This new global agenda seeks to eradicate extreme poverty by 2030 while stimulating socially inclusive and environmentally sustainable economic growth. It specifically calls for encouraging the growth of SME to boost job creation and economic opportunities for all.
Speakers in Doha will address the unique challenges and opportunities faced by SMEs in developing countries and economies in transition. They will point to how these businesses, which account for the bulk of employment around the world, can be empowered to use international trade and investment to drive growth and job creation.
The two-day event will consist of four plenary sessions and four parallel breakout sessions, alongside structured and informal B2B meetings aimed at enabling participating SMEs to meet potential customers, suppliers, and investors.
About WEDF 2015
Opening up new trade and investment opportunities to encourage sustainable growth will be at the heart of this year’s World Export Development Forum (WEDF), which will be held in Doha, Qatar from 20-21 October.
The 15th edition of the International Trade Centre (ITC)’s flagship event will be hosted by the Ministry of Finance of the State of Qatar through the Qatar Development Bank (QDB) under the theme ‘Sustainable trade: Innovate, invest, internationalize’.
Policymakers, representatives of trade support institutions and businesses are invited to meet in Doha against the backdrop of the post-2015 development agenda calling to renewed efforts to unlock the potential of small and medium-sized enterprises, women and youth.
Alongside high-level panel discussions and practical working sessions, facilitated business-to-business meetings will allow participants to take advantage of the Gulf countries’ unique position at the crossroads where east meets west to explore new business opportunities.
The World Export Development Forum (WEDF) is a unique global platform dedicated to supporting export-led development.
WEDF provides an issue-focused setting for policymakers, trade support institutions and business leaders to gain practical understanding in trade competitiveness. It also provides unparalleled opportunities for business operators to network and meet with potential partners. Organized by the International Trade Centre (ITC), the only United Nations organization with an exclusive focus on assisting small and medium-sized enterprises (SMEs) to internationalize, WEDF is dedicated to the development of SMEs.
SMEs are the backbone of the global economy, especially in developing countries, where they contribute two-thirds of employment. Their role is even more important in least developed countries, where they account for 80% of jobs and are key to inclusive growth. Increased participation of SMEs in regional and global trade leads to improved livelihoods for a large segment of the population, including for women and youth. SMEs’ contribution to job creation in developing countries is thus essential. They will be a key source of employment as 500 million men and women enter the global labour market by 2030. Given their role in providing decent employment, supporting economic growth and reducing poverty, SMEs must play a central part in the global development framework.
WEDF will bring together over 500 senior national and international policymakers, heads of trade support organizations, business leaders and representatives of international agencies. Through a varied programme, participants will increase their practical knowledge in the latest innovations, processes and policies, and establish new partnerships and contacts through networking.
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On World Statistics Day, UN flags importance of reliable data to achieve new development agenda
Emphasizing that “reliable and timely statistics and indicators are more important than ever,” United Nations Secretary-General Ban Ki-moon on 20 October urged all partners and stakeholders to work together to achieve the ambitious 2030 Sustainable Development Agenda.
“On this World Statistics Day, I urge all partners and stakeholders to work together to ensure that the necessary investments are made, adequate technical capacity is built, new data sources are explored and innovative processes are applied to give all countries the comprehensive information systems they need to achieve sustainable development,” Mr. Ban said in a message.
Stefan Schweinfest, Director of the UN Statistics Division in the Department of Economic and Social Affairs, elaborated by saying that “it is clear that the significantly broader development agenda with a higher focus on disaggregation will require more resources, new methodological developments, integration of new data sources with traditional ones, the building of partnerships and increased cooperation within and across countries.”
“Sustainable development will need to be supported by sustainable Statistics,” Mr. Schweinfest declared, referring to the newly-adopted UN post-2015 development framework.
Mr. Ban said that as countries and organizations embark on implementing the ambitious 2030 Agenda for Sustainable Development, reliable and timely statistics and indicators are more important than ever.
“We need to ensure that everyone is counted, especially the most poor and vulnerable,” he said. “No child’s birth shall remain unregistered. No incidence of disease, no matter how remote the location, shall remain unrecorded.” The UN chief said “local statistics” are needed to ensure that every child has access to education while “global statistics” are needed to monitor the effects of climate change.
Also marking the Day, the UN Statistics Division launched in New York the new World’s Women 2015: Trends and Statistics report, which presents the latest statistics and analyses of the status of women and men in areas of concern identified by the landmark 1995 Beijing Platform for Action. It also reviews progress towards gender equality over the past 20 years.
Meanwhile, the World Food Programme (WFP) will celebrate World Statistics Day with a talk on why investing in primary and secondary data collection and analysis are fundamental for the design and implementation of food assistance programmes worldwide.
And the Food and Agriculture Organization (FAO) released its new FAO Statistical Pocketbook 2015 and a special statistics publication focusing on coffee and includes country profiles with key indicators related to coffee for selected years. Click here to download (PDF, 6.59 MB)
African, Caribbean and Pacific (ACP) Ministers of Trade meeting: Opening statement by Hon. Joshua Setipa
Opening statement by Hon. Joshua Setipa, Chairman of the ACP Ministers of Trade Meeting and Minister of Trade & Industry of Lesotho, delivered at the African, Caribbean and Pacific (ACP) Ministers of Trade meeting on 20-21 October to discuss a ACP position for the 10th Ministerial Conference of the World Trade Organisation (WTO) to be held in Nairobi, Kenya on 15-18 December.
I join the Secretary-General in welcoming you to ACP House for this meeting of the ACP Ministers of Trade. I am encouraged that so many colleagues were able to come to Brussels, knowing the numerous conflicting engagements that most of us are confronted with. However, our presence today is a clear testimony of the importance that our countries attach to trade.
We all know that trade contributes to growth, development and prosperity. Increased trade and investment can also curtail jobless growth and curb high unemployment. Trade can contribute to the reduction of poverty and inequality and at the same time support the environment and contribute to sustainable development.
For all our States in the ACP Group, equitable integration into the global trading system remains a formidable challenge against the backdrop of current marginalisation of our countries.
Most of our countries suffer from inherent structural constraints and infrastructural deficits. A number of our States depend on commodity exports to traditional markets, in some cases one single commodity is the major foreign exchange earner.
Coupled with the uncertainty of benefits from the final outcome of the WTO Doha Round of negotiations and the Economic Partnership Agreements with the European Union, we must work to respond to this dire situation that we all face.
We have witnessed increasing globalisation with geographical shifts in patterns of growth, trade and investment. We have also witnessed technological advances and the rise of international value chains.
In addition, the proliferations of preferential trade agreements and the growing influence and use of non-tariff measures that become barriers to trade. All these are some of the factors that will continue to impact on ACP’s trade in the future. We have no choice but to do all we can, within our means, to surmount them.
We should not be deceived or become complacent from the seemingly improved performance of some of our economies. There is a lot more that needs to be done and to be achieved, if we are to get onto a sustainable and sustained irreversible path of economic growth.
Therefore, as we meet today to prepare for our Group’s participation at the Tenth WTO Ministerial Conference to be held in an ACP State, we all attach great importance to the Conference and we should all commit to do all we can to ensure a successful outcome.
The whole world is looking closely at the multilateral trading system and is keen to see if the Tenth WTO Ministerial Conference will build on the optimism created with the Bali outcome. The outcome of the Ninth WTO Conference went some way into restructuring the Doha Development Round and restoring some hope and confidence. However, preparations for the Nairobi Ministerial is of great concern and has created some anxiety.
Our Members in Geneva have put forward proposals that have been recognised but are not yet included in the so called mini-package.
As of today, the agenda for the Conference has not been set.
The nature of the outcome document has not been agreed. The road ahead is foggy. This is not good news.
When the current WTO Round was launched, it was referred to as the Doha Development Agenda, because it promised to deliver on development. So far that development promise has eluded us and has proved to be a mirage. Bur we have to keep on keeping on, pushing for our interests and to have our concerns fully addressed.
We are concerned that some Members are even calling for the DDA to be abandoned altogether. We need to discuss how to respond to such calls.
The European Union, our key development partner is currently debating its future trade and investment policy.
Part of the strategy that the EU has outlined is a welcome proposal to reinvigorate the multilateral trading system. But there is also the idea of, and I quote, “turning the page on the DDA”.
How will this be done?
The answer to that will be partly be the subject of our exchange this afternoon with the European Commissioner for Trade, Ms. Cecilia Malmstrom. We have in the past been concerned by some EU actions which tend to impact on our trade relations. The European Union’s bilateral agreements with third countries has eroded some of the perceived benefits that we expected to get from the Economic Partnership Agreements, such as trade preferences.
In particular, the Trade and Investment Partnership (TTIP) negotiations between the European Union and the United States, if concluded with tariff liberations between the parties could do no hard to some of our exports. We have learnt that trade diversion will result, and a clear case in point is cars from South Africa. There could well be other products that will be affected but this will be clear once the Agreement is concluded.
I am also informed that the WTO Director General will join us tomorrow morning for an exchange of views. In his capacity as the Chairman of the Trade Negotiations Committee, we expect that he will be able to update us on progress in the DDA as well as in the preparations for the Nairobi Ministerial.
Before concluding, I invite you to join me in commending the ACP negotiators in Geneva for the good work they have been doing through the presentation of proposals and engaging with the WTO members. They have continuously worked hard to defend the interests of our group. I wish to also acknowledge the contribution of the team of consultants that has provided technical inputs for our work.
To close, I urge us to remain steadfast in our goals. Let us work to rally all WTO members to make Nairobi a success and in so doing to restore the pride of place of the WTO and the multilateral trading system.
I thank you for your kind attention.
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DG Azevêdo: Africa can be biggest winner of MC10
Director-General Roberto Azevêdo attended an informal meeting of African Union trade ministers in Brussels on 20 October to discuss preparations for the WTO’s 10th Ministerial Conference, which will be held in Nairobi in December. The Director-General gave a frank assessment of the current situation.
“We are now just eight weeks away from the ministerial conference. We must ensure that Nairobi is a success – and that it delivers for Africa. We still face very significant challenges. Despite intense efforts this year, we have made little progress on the core Doha issues,” DG Azevêdo said.
“However, there are still some elements on which we may be able to find agreement. A package of development and LDC issues would be at the heart of any such outcome. An agreement on export competition in agriculture would also be a very significant breakthrough for developing countries – in fact it would be the WTO’s first ever negotiated outcome on agriculture. In addition, it may be possible to deliver some measures to increase transparency in some areas of trade policy, potentially covering issues such as antidumping and fisheries subsidies.
“These potential deliverables don’t represent a perfect outcome – they simply represent what seems to be achievable at this stage. Nevertheless it is clear that they could have real economic and developmental significance – particularly for Africa, which could be the biggest winner of the ministerial conference. I am working hard to make sure that we deliver for Africa.
“But just as important as any deliverables in Nairobi will be the direction of our work after Nairobi. There are big decisions to take about the future of the system. We have to ensure that the WTO continues to be operational, so that developing countries continue to have a seat at the table. I urge African members to get involved in this conversation now.”
In summing up the meeting, the chair, Joshua Setipa, Lesotho’s Minister of Trade and Industry, underscored the desire of ministers to increase their engagement in the final weeks leading up to the ministerial conference, in order to achieve a strong outcome.
The Director-General was also joined on the panel by African Union Trade Commissioner Fatima Acyl and Cabinet Secretary Amina Mohamed of Kenya, who will chair the 10th Ministerial Conference. Tomorrow the Director-General will attend a ministerial meeting of the Africa, Caribbean and Pacific Group of States.