Search News Results
East Africa sets July deadline to harmonise roaming rates
Communications ministers in the five East African Community members states have been given up to July to harmonise roaming rates in the region.
The directive was issued through a joint communiqué signed by the presidents of the five countries following the 16th heads of state summit held in Nairobi, yesterday. Tanzania and Burundi finally agreed to join the drive for common roaming rate to cut the cost of calling across borders in the bloc. It was started by Kenya, Uganda and Tanzania.
“The summit directed the council to expedite implementation of the framework for harmonised roaming charges, including the removal of surcharges for international telecommunications traffic originating and terminating within the East African Community by July 15, 2015,” the statement read. Present at the summit were presidents Pierre Nkurunzinza (Burundi), Jakaya Kikwete (Tanzania), Uhuru Kenyatta (Kenya) Yoweri Museveni (Uganda) and Paul Kagame of Rwanda.
High call rates across borders has been cited as one of the biggest hindrance to economic integration in the region, as countries imposed high taxes for international calls terminating within their borders. Under the northern corridor infrastructure summit last year, Kenya, Uganda and Rwanda agreed to limit the maximum roaming charges in the three countries at about Sh9 ($0.10) per minute for retail and Sh6.21 ($0.069) for wholesale.
On September 1, the three States published gazette notices to implement roaming tariffs within the one area network. The plan is expected to spur international trade with the community, which has been on the decline over the past few years. On Thursday, manufacturers in Kenya said they were concerned that the contraction of trade between Kenya and the countries in the East African Community could hurt their revenues.
Trade between Kenya and Tanzania, Rwanda, Uganda and Burundi declined by Sh10 billion in 2013 and the gap could be bigger when the 2014 statistics are out. “The government has focused too much on what happened in the few years to 2012 when there was tremendous growth in the value of trade with the region. But if you look at 2013, you will see that there is a crisis. A lot needs to be done for this to change because the community is a very important market for us,” Kenya Association of Manufacturers chief executive Betty Maina said.
Ms Maina noted that the trend is worrying given that manufacturers have always found their biggest export market in East Africa. She was speaking during a forum on market expansion, Kenya’s foreign trade policy and challenges facing the regional market. “It is a big concern for us and we are reaching out to our counterparts in the regional governments to see if there are interventions we can make at policy level as well fast-tracking the implementation of already established initiatives,” Mr James Kiiru, a director at the Ministry of Foreign Affairs and International Trade said.
Kenya Association of Manufacturers said it was ready to host a meeting with government officials to help check the decline in trade.
Related News
New initiative to increase access to seed varieties in Comesa area
Rwanda yesterday assented to regulations that will govern trading in seed varieties within the Common Market for Eastern and Southern Africa (Comesa).
The regulations, which will have to be adopted in all the 19 member states before coming into force, will facilitate safe movement of quality seeds within member states. To qualify to benefit from the initiative, seeds will first have to go through a quality certification process, according to officials.
The Minister for Agriculture and Animal Resources, Geraldine Mukeshimana, said the initiative will stimulate the breeding and availability of many new improved seed varieties, which will give better alternatives to farmers. “We had challenges where someone, for example, couldn’t easily sell seeds produced in other countries which were hindering farmers to access various varieties,” Mukeshimana said. She added that having many seed varieties to choose from will help farmers alternate, especially in the era of climate change which requires innovation from time to time to keep the yields high.
Argent Chuula, the chief executive of Alliance for Commodity Trade in Eastern and Southern Africa (Actesa), a Comesa specialised agency, said there is a lot to do to move the sector upward by availing adequate improved seeds for farmers to attain food security. Chuula said, currently, the region has a total seed production of about 500,000 metric tonnes per annum, while a total demand for seeds is about two million metric tonnes.
In Rwanda, seed production stands at about 8,000 metric tonnes a year, while some members of the bloc have even less production capacity. This indicates that there is still deficit in the region that imports from other regions outside Africa, a fact that calls for Comesa to have own producing industries.
Gervais Ngerero Nkuriza, the director of seed department at Rwanda Agriculture Board (Rab), said the harmonisation of regulations requires that seeds fulfill international standards before being added on the list. “The seeds are to be certified in a harmonised way. Variety can be from one country to another, Rwanda has, for example, beans varieties of “Vun’inkingi” and will be exported to Kenya, Uganda, and Tanzania to be grown there. So we also can import others,” he said
Among the laboratory standards required to be certified, there is, for some crops, a minimum germination at 90 per cent, minimum pure seed at 99 per cent, and maximum moisture 13 per cent, among others, he said.
Related News
UNCTAD releases review of trends in investment agreements and investor-State dispute settlement
This UNCTAD IIA Issues Note reviews recent trends in international investment agreements (IIAs) as well as investor-State dispute settlement (ISDS) cases, providing up-to-date statistics and analysis.
According to the Note, countries continue to use IIAs as a tool for international investment policy making. The year 2014 saw the conclusion of 27 IIAs, that is one every other week. This brings the total number of agreements to 3,268.
The IIA universe is evolving with regard to substantive provisions: pre-establishment commitments and sustainable development-oriented clauses are on the rise. At least 45 countries and four regional integration organizations are currently revising or have recently revised their model agreement. Investors continue to use the ISDS mechanism. In 2014, claimants initiated 42 known treaty-based ISDS cases. With 40 per cent of new cases initiated against developed countries, the relative share of cases against developed countries has been on the rise (compared to the historical average of 28 per cent).
The two types of State conduct most commonly challenged by investors in 2014 were cancellations or alleged violations of contracts, and revocation or denial of licences. Over time, the Energy Charter Treaty surpassed the North American Free Trade Agreement as the most frequently invoked IIA. ISDS tribunals rendered at least 42 decisions in 2014. This includes an award of USD 50 billion in three closely related cases, the highest known award by far in the history of investment arbitration. The overall number of concluded cases has reached 356, with 37 per cent decided in favour of the State, 25 per cent in favour of the investor and 28 per cent of cases settled.
The year saw important multilateral developments geared towards increased transparency in ISDS. These include the coming into effect of the United Nations Commission on International Trade Law Rules on Transparency and the adoption of the Convention on Transparency in Treaty-based Investor-State Arbitration, which will be opened for signature later in 2015.
Concerns about IIAs and ISDS have prompted a debate about their challenges and opportunities in multiple forums. Today, a broad consensus is emerging that the regime of IIAs and the related dispute settlement mechanism need to be reformed to make them work better for sustainable development. Such reform would need to be undertaken in a comprehensive and gradual way, taking into account the interests of all stakeholders.
Related News
ArcelorMittal calls for tariff protection
ArcelorMittal SA has applied to the International Trade Administration Commission (Itac) for anti-dumping duties as they claim Chinese steel is coming into South Africa and being sold at a price below the cost of production.
In an interview, ArcelorMittal chief executive Paul O’Flaherty said this week that this came as over 600 000 tons of steel was imported into South Africa from China last year, which was sold at least R500 per ton cheaper than local prices. “We believe they are offering their products at prices lower than their costs,” he said.
O’Flaherty said ArcelorMittal had asked for tariff protection on four steel products. “We have put our application through and it is going through the process.”He said the company had undertaken all the cost cutting it could and that the tariff intervention was more of a last resort for the industry, particularly as the price of steel was on a downward spiral.
“To counter this we are producing at full capacity so we can benefit from economies of scale,” he said. An official of the Steel and Engineering Federation of South Africa (Seifsa) confirmed that China had a surplus of steel that had resulted in depressed world prices. ArcelorMittal employs 13 500 people at its South African operations.
In another development, the wire and mesh industry has successfully applied to Itac for the introduction of tariffs on some of their products as a result of imports from China. The wire industry was granted an ad valorem tariff that was increased from 5 percent to 15 percent on barbed wire, wire mesh and hexagonal wire netting. An ad valorem tariff is a duty or other charges levied on an item on the basis of its value and not on the basis of its quantity, size, weight or any other factor.
The wire and mesh industry was also granted an increase to 10 percent ad valorem tariff from tariff free for wire of iron or non-alloy steel. The latest increase was granted in early February, while the first was granted in December. An application for the introduction of tariffs on galvanised wire was turned down by Itac, but a source at the South African Wire Association (Sawa) said they would be appealing the decision in a year’s time. The reason was that galvanised wire was an input product and its cost in South Africa was very competitive.
Sawa’s membership includes Scaw Minerals Group, Hendok, ArcelorMittal SA, Ram Trading, Consolidated Wire Industries, Fournel, Galvco Engineering and Cape Gate among others and collectively employ about 3 000 people. The association said the intervention by Itac came as a number of their members were on the verge of bankruptcy, having lost market share in large parts of Africa, North America, Europe, as well as the Far East. “There have always been some wire products coming in, but they have been increasing to a greater extent in recent years. The Chinese have become very aggressive of late,” the source said.
The Sawa members will now focus on exporting to the rest of Africa, where they hope to have a competitive advantage over Chinese producers.He said Sawa was pleased that Itac had intervened favourably, and said the benefits of the new tariffs would perhaps be seen from the next quarter. Itac spokesman Foster Mohale confirmed that “most of the imports originate in East Asian countries”. “The commission did not support the application for an increase in customs duty on galvanised wire. However, the application for an increase in customs duty on the other three wire products was supported,” he added.
He said the commission had found that import volumes for galvanised wire declined from about 21 200 tons in 2011 to about 15 700 tons in 2013. Mohale said with regards to the other three wire products, the commission had found that import volumes grew significantly during the three years.
In volume terms, imports of barbed wire increased from about 3 000 tons in 2011 to almost 4 400 tons in 2013; wire mesh imports rose from about 800 tons in 2011 to almost 1 400 tons in 2013; and imports of hexagonal wire netting climbed from about 1 300 tons in 2011 to roughly 4 300 tons in 2013. “As a result of increased imports, the domestic industry is unable to utilise its existing production capacity to achieve economies of scale,” he said.
Related News
The AfDB Group supports power trade between Kenya and Tanzania
The Board of Directors of the African Development Bank Group (AfDB) approved on Wednesday, February 18 in Abidjan an African Development Fund (ADF) Loan of US $144.9 million, to the Kenya–Tanzania Power Interconnection Project.
The project will allow the two countries to exchange power. In addition, the Kenya–Tanzania Interconnection Project plays an important role in promoting regional integration through power trade. The project is expected to improve the supply, reliability and affordability of electricity in the Eastern Africa region through cross-border exchanges of cheap and cleaner surplus power from neighbouring countries. The project involves the construction of approximately 508 kilometres of transmission line between Kenya and Tanzania (about 93 km in Kenya and 415 km in Tanzania) and associated substations in Arusha and Singida (Tanzania).
The line will have a transfer capacity of up to 2,000 MW in either direction. The Ethiopia–Kenya interconnection line will allow for the interconnection of the Eastern Africa Power Pool to the Southern African Power Pool and further in the future to Northern Africa through the East Africa Electricity highway. At its initial stage, the project will allow Ethiopia and Kenya to exchange power, followed by the import and export of energy from the interconnected countries.
Following the Board’s approval, the Director of the AfDB’s Energy, Environment and Climate Change Department, Alex Rugamba, explained that the project aligns with the pillars of the regional integration strategy papers (RISPs) for Eastern Africa, which focus on regional infrastructure and capacity building. It also fulfills the objectives of the New Partnership for Africa's Development (NEPAD) in terms of regional integration and promotion of infrastructure development through regional co-operation in key productive sectors such as energy. He also added that the interconnection line will create competitiveness in the energy sector and will encourage private sector investing in the generation of electricity by facilitating power transfer through the interconnector.
Related News
New report on national trade facilitation bodies in the world
With the signature of the WTO Trade Facilitation Agreement (TFA), countries have committed to creating or maintaining a national trade facilitation committee.
Setting up a national mechanism is in itself one of the most traditional and most important trade facilitation measures to ensure that the main public and private stakeholders are consulted and engaged in the elaboration and implementation of national trade facilitation reforms. Over the past decades, it has received a lot of attention from national and international agencies dealing with trade facilitation.
Undoubtedly, since UNCTAD published its Trade Facilitation Handbook Part I – National Facilitation Bodies: Lessons from Experience in 2006, the picture has changed for trade facilitation working groups. The presence of trade facilitation in the international trade agenda has increased and trade facilitation working groups now benefit from stronger national, regional and international support. As shown in recent UNCTAD research, the number of provisions related to customs and trade facilitation included in regional trade agreements has increased, including those that encourage or require the creation of trade facilitation bodies.
Moreover, almost a decade after they were launched, the negotiations on trade facilitation at the World Trade Organization successfully came to an end in December 2013. World Trade Organization members have committed to creating or maintaining a national trade facilitation committee, as stated in section III, article 23.2 of the Agreement on Trade Facilitation.
In this context, this UNCTAD publication, based on an in-depth analysis of 50 trade facilitation bodies, could not be timelier. It provides the first quantitative analysis of existing national trade facilitation bodies and a first-hand set of recommendations extracted from the experiences of participating stakeholders. The study provides policy-oriented conclusions aimed at assisting those countries that are looking to set up or strengthen their national trade facilitation working groups.
The study shows that, regardless of the type of body, the biggest challenge for trade facilitation working groups is their sustainability. There is no one determining element, but many factors might have an impact on the sustainability of a group. The relative importance of each element depends on the administrative culture of each country. However, analysis shows that the level of development of a country is the most influential factor on the sustainability of a group. The type of body and geographical region may also be determining elements.
With an interactive and user-friendly interface, UNCTAD’s latest version of the online repository of national trade facilitation bodies presents information from trade facilitation platforms in over 80 countries and also assists UNCTAD member States in creating or strengthening trade facilitation bodies through useful information about country cases from different geographical regions on the establishment and management of trade facilitation bodies.
Related News
ZABS commissions $20,000 testing kit
The Zambia Bureau of Standards (ZABS) has commissioned a US$20,000 packaging and testing equipment to meet regional standards
The International Trade Centre (ITC) facilitated the buying of the equipment as part of technical assistance to the project called Promoting Intra-regional Trade in Eastern Africa, which is funded by Finland.
Head of marketing and public relations Hazel Zulu said the installation of the equipment will enable ZABS provide testing services for users and suppliers who package products to conform with the packaging specifications and quality standards that exists in southern Africa.
Mrs Zulu said in a posting on ZABS’ Facebook page that the equipment is able to conduct 55 different tests on packaging materials such as paper, plastic labels, cartons, corrugated boxes, glass, plastic containers, cans, plastic films and adhesives, among others.
“The Impee Porta Lab, developed by the Mexican Institute of Packaging Professionals is economical, simple, portable testing equipment suitable for all packaging materials. “Packaging suppliers and users in many African countries face the challenge of performing quality checks on packaging due to the lack of relevant testing equipment,” she said.
Similarly, ITC senior adviser for export value chain Kofi Essuman said good packaging is a prerequisite for successful market access and increased sales.
Related News
Nigeria, China Trade Hits $18bn
The Consul-General of the People’s Republic of China in Lagos, Mr. Liu Kan, has revealed that the volume of trade between Nigeria and China in 2014 was about $18.1 billion.
Mr Kin disclosed this in Lagos on Wednesday, as he noted that there was relative increase in the exchange of goods and services in the year over the 2013 transactions. “Today, Nigeria is China’s third major export destination in Africa after South Africa and Angola, while China is Nigeria’s largest source of imports and third major trade partner.
“According to China Customs, the trade volume between China and Nigeria in 2014 rose to about $18.1 billion which is an increase over our 2013 transaction.“We should say that our bilateral relations in 2014 rose to a new level that we all expected,’’ he said.
The envoy said Chinese companies had in 2014 invested in Nigeria’s construction, manufacture, oil and gas, telecommunications, agriculture, real estate sectors and free trade zones.
Mr Kin, who expressed the Chinese government’s satisfaction with both countries’ present level of win-win cooperation, said that both countries socio-economic relations would be brighter in the years ahead. The consul-general also disclosed the Chinese government’s plan to simplify visas application processes for Nigerian businessmen and women this year. “We know that every year thousands of Nigerian businessmen attend the Canton Fair in search of new business opportunities and partners.
“We are, therefore, going to be creating the right visas application processes for them to enable more Nigerians to do business with Chinese manufacturers and businessmen,’’ he said. Mr Kin also disclosed plans by more Chinese companies to come and invest and do business in Nigeria.
He appealed to the federal government to create the right environment for more Chinese companies to come in and invest.
Related News
Rwanda: New Levy on imports to finance regional projects
The government has approved a draft law that seeks to impose a new levy on goods imported from outside the East African Community (EAC) in order to collect funds needed for regional infrastructure projects.
The draft law establishing the Infrastructure Development Levy on imported goods was approved by last week’s Cabinet meeting. According to the proposed law, all imported goods (from outside EAC), except those exempted under the law, are subject to a levy of 1.5 per cent on the customs value of imported goods. The government says the levy “is intended to mobilise funds for regional infrastructure projects that will assist in improving the infrastructure and reduce the cost of transport and the cost of doing business in the region.”
The regional infrastructure projects to be funded include the railway and energy networking infrastructure such as electricity grids and oil pipelines, which are being pursued under the Northern Corridor Integration Projects initiative. “To run these big projects, countries need huge financing. With the view to overcome this problem, EAC Heads of State introduced the idea to establish a levy on imports from outside the bloc to finance the projects,” a Cabinet paper, a copy of which The New Times has seen, reads in part.
The draft law approved by the Cabinet says the levy on goods imported will be collected at Customs points by Rwanda Revenue Authority in accordance with the customs legislation and deposited into a sub account of the Treasury. Although the draft law is yet to be tabled in Parliament, the plan to impose the levy is already being touted by government officials as a sure source of funds to finance ambitious infrastructure projects.
‘A good source of funds’
The State Minister for Transport, Dr Alexis Nzahabwanimana, told The New Times that the levy will be a good source of funds to build the Rwandan side of the railway of the Northern Corridor whose feasibility study is set to be completed in July. “We are mobilising funds from different sources, including the infrastructure development levy,” he said.
If passed by Parliament in its current form, goods to be exempted under the new law would include those imported while they were made or tax exempted from within the EAC, fertilisers and seeds, live animals, medicine and pharmaceutical products. Goods such as medical equipment, mosquito nets, industrial machinery and equipment for energy and water sectors, as well as for investment projects with investment certificates are also exempted from the levy.
The 1.5 per cent infrastructure development levy on goods imported outside EAC was agreed on by EAC ministers of finance during consultations last year. If Rwanda starts imposing the levy, it would be following the example of Kenya and Uganda, who are already implementing the policy, while Burundi and Tanzania are still consulting before they start imposing the levy.
Experts root for the levy
Experts say the levy on imported goods from outside the EAC will help government to both get the money it needs for infrastructure in the short-term, while also easing the cost of doing business in the long-term. “In the short-term people may immediately feel the pinch from paying the levy but the long term benefit is to reduce the cost of transport and of doing business,” said Frobisher Mugambwa, a Kigali-based senior tax manager at PricewaterhouseCoopers, a global services advisory firm.
Angello Musinguzi, a tax manager at KPMG, a global network of professional firms providing audit and advisory in tax services, agrees that imposing the levy may provide government with the money needed to build infrastructure, which the private entrepreneurs need to ease their business. “Importers will transfer the cost of the levy to the end-consumers but it’s definitely going to help government get funds to invest in the (infrastructure) projects,” Musinguzi said.
Related News
Ecowas Member States urged to mainstream regional programmes into national development plans
ECOWAS Member States have been encouraged to integrate regional progammes and aspirations in their national development plans to facilitate the realization of the overarching objective of regional economic development and integration.
“Where the political will is strong, it should be easier for a country to draw up its national development plans, strategies and programmes with regional considerations,” Mr. Essien Abel Essien, Director of ECOWAS Strategic Planning Directorate said at the opening of the inaugural National Planning Experts meeting in Lagos on Wednesday 18th February 2015.
Acknowledging that due to internal problems and competing demands on their limited resources, “many countries tend to put much more emphasis on national than on regional projects,” the director however, said the ideal situation is for countries to “ensure efficient coordination between the objectives and instruments of regional integration and national policy making.” “ECOWAS requires a planning process that is participatory and inclusive,” he said, explaining that this reason informed the gathering of national planning experts to deliberate on the methodology for facilitating the coordination and integration of regional aspirations into national plans.
Mr. Essien said that while experience in the past had shown that governments and inter-governmental organizations had “generally dominated and monopolized the dialogue on integration, there is emerging recognition of the need to involve civil society in the process because an integration process that involves civil society stands a much better chance of success.” This explains the invitation of civil society organizations such as the West African Network for Peace building (WANEP), West African Civil Society Forum (WACSOF) and the West African Civil Society Institute (WACSI) to the meeting.
He told the experts that the region was at a crucial stage of development and the actualization of the ECOWAS Vision 2020, adding: “with collective action we can steer the course of integration, using the instrumentality of the Community Strategic Framework (CSF) towards the actualization of the dreams of our founding fathers.” In his welcome address, Mr. Tunde Lawal, Director of Micro-economic Analysis, in Nigeria’s Federal Ministry of Planning reiterated the benefits of bringing regional perspectives into national planning. He therefore urged participants to come up with concrete recommendations for the domestication of regional plans and policies for coordinated regional development and integration.
The three-day meeting will among others, discuss the harmonization and integration of the Community Strategic Framework (CSF 2016-2020) into national plans as well as development planning and the modality for a comprehensive stakeholder consultation exercise in Member States on the CSF. It is also expected to establish a regional structure for mainstreaming regional programmes into national planning efforts and come up with guidelines on integrating and managing regional integration at the national level.
As part of efforts for the realization of the ECOWAS Vision 2020 of a citizen-oriented integrated community, a Regional Strategic Plan (RSP) was adopted in June 2010, involving identification of a set of programmes including community projects to be undertaken up to 2020.
The Community Strategic Framework, which is the RSP successor plan, provides overall direction with respect to Community goals, principles of engagement with stakeholders and guidance to Community institutions/agencies in the design and preparation of their strategic plans.
Related News
Changes in SACU revenue
Martin Dlamini, Minister for Finance, says an agreement has been reached on the issue of the Southern African Customs Union (SACU) revenue sharing formula.
He said with the new formula, countries will get a fair share of revenue from the pool and that the previous disagreements over the sharing of the revenue were sorted out in the SACU Council of ministers meeting held in the latter part of January 2015. Countries in the SACU economic bloc include Swaziland, Namibia, Botswana, Lesotho and South Africa.
The recent meeting was a follow up to a gathering that was hosted on December 10 and 11, 2014 which did not conclude on the revenue share for each country in the SACU pool.
A conclusion could not be reached then because there were disagreements on how the money was to be shared. The other reason was that South Africa was not part of the meeting. Dlamini said following the successful meeting, the focus was now on calculating how much each country would get from the SACU pool of revenue. The minister said he was not sure how the agreed formula would affect Swaziland’s share for the next financial year 2015/16.
“I am not yet certain whether revenue due to Swaziland will drop or increase.” However, according to previous projections on the revenue due to countries in the pool, countries should expect a drop in their share of revenue. Bheki Bhembe, Principal Secretary (PS) in the Ministry of Finance, said the downward risks emanated from the performance of South Africa’s economy.
Related News
Sugar industry in confusion
There is confusion in Tanzania’s sugar industry following the government’s recent decision to make a U-turn on the modalities of importing the item.
Related News
COMESA and ITC to step up collaboration
The International Trade Centre (ITC) and the Common Market for Eastern and Southern (COMESA) will step up cooperation with a view to boosting intra-African trade.
ITC Executive Director Arancha González and COMESA Secretary-General Sindiso Ngwenya on 18 February 2015 signed a Memorandum of Understanding to work together on the design and implementation of trade-related technical assistance across the 19-strong trade bloc.
Building on past collaboration, the two organizations pledged to cooperate on areas such as regional integration, trade facilitation improving SME competitiveness and enhancing the trade and investment climate. Particular attention will be placed on promoting product development and value addition in the agricultural and services sectors. Mr. Ngwenya said that the ITC-COMESA partnership will help develop and create capacity for national and regional initiatives in a bid to boost competitiveness. ‘We intend to use the partnership as a key component to increase the quality of products and improve productivity,’ he said.
Mr. Ngwenya noted that many Africa entrepreneurs do not know how to advertise their products effectively but added that, in most cases, packaging is too poor to have a significant impact on the market. 'Together, COMESA and ITC will help African entrepreneurs develop creative solutions and innovations that better meet consumers’ expectations and demands,' he said.
'Expanding intra-African trade holds the key to growth in African countries,' said ITC Executive Director Arancha González. 'Regional Economic Commissions such as COMESA are critical to ensuring coherence between national and regional initiatives and to supporting SMEs in Africa achieve competitiveness. ITC is pleased to strengthen our existing partnership with COMESA and to assist countries to achieve economic growth through trade and SME competitiveness.' 'ITC’s partnership with COMESA is particularly important for the region’s smaller economies, whose prospects will improve as regional integration creates larger markets and more opportunities for regional value chains,' Ms. González said.
Another major component of the partnership between COMESA and ITC will be to provide continued support to countries seeking to meet their commitments under the World Trade Organization’s Trade Facilitation Agreement (TFA), with special attention to provide guidance to small and medium-sized enterprises, which suffer the most from high trading costs. The implementation of the TFA is expected to provide huge economic benefits to business and governments arising from enhanced regional trade.
In line with both organizations’ goal of providing better opportunities for youth and women in trade, both ITC and COMESA will step up their efforts to strengthen the capacity of trade and investment support institutions and businesswomens’ networks.
Related News
Development Banks from the BRICS
The BRIC acronym was created at the beginning of the 2000s to represent a group of four fast-growing economies – Brazil, Russia, India and China – and was changed to BRICS in December 2010 with the inclusion of South Africa. At its fifth annual summit in Durban at the end of March 2013, the group announced the future establishment of a New Development Bank (NDB) to meet infrastructure investment needs in the developing world.
At their sixth annual summit in Fortaleza the following year (July 2014), the BRICS finally agreed on the broader arrangements for the bank – an initial US$50bn fund – and coupled this achievement with the launch of the Contingency Reserve Arrangement (CRA) – US$100bn to be accessed to alleviate members’ financial difficulties (US$41bn from China, US$5bn from South Africa and US$18bn from each of the others). The Bank will start lending in 2016.
Despite this achievement, commentators estimate that even if the NDB eventually increases its capital to US$100bn with injections from non-BRICS states and institutions (up to a maximum capital share from non-BRICS countries of 45 per cent), most infrastructure needs in the developing world will remain unmet. Compared to the World Bank and Asian Development Bank – whose subscribed capital is US$223bn and US$162bn respectively – the additional capital available from the NDB is too small to fill the financing gap (Spratt 2014).
According to World Bank estimates, South Asia alone requires US$2.5tn over the next ten years, while overall the BRICS states are estimated to need a total of more than US$4.5tn over the next five years for infrastructure development. In consideration of the limited amount of lending that the NDB may provide, the bank may create ‘special funds’ – i.e. separately funded and managed mechanisms – designed to get round this capital constraint (Spratt 2014).
Related News
The African Development Bank Human Capital Strategy for 2014-2018
This Human Capital Strategy, the first for the Bank, is the operational framework for the Bank’s interventions in human capital in Africa.
Africa’s new landscape compels significant repercussions for building human capital amid downside risks of persistent poverty and increasing inequalities. Africa lives a paradox of rapid economic growth alongside poverty and inequalities that have striking effects on youth and women.
The labor market disarray, marked by rising skills mismatch, low productivity in the informal sector, and unemployment and underemployment among a youth population set to reach more than 1 billion by 2050, reflects a generation at risk.
Related News
New initiative to help increase exports to Canada
Rwandan-made products could soon increase on the Canadian market following an initiative by Rwanda Development Board (RDB) and the Canadian Trade Facilitation Office (TFO) to link local exporters with potential buyers in the North American nation.
This was agreed upon at a seminar for local small and medium enterprises with interests in exports in Kigali, yesterday. The meeting was jointly facilitated by RDB and TFO to increase chances of accessing the Canadian market. According to the Canadians, the goods that are likely to be on high demand in their country include spices, flowers, and vegetables.
Eusebe Muhikira, RDB head of export and business development , said there was a huge opportunity for local firms to export to Canada with the current levels of exports estimated at $2 million. He said the market information to the SME’s will fill the gap that has been curtailing exports as the firms lacked relevant skills or finances to conduct research. “Gathering information from new markets requires skills and is often too expensive for small exporters,” Muhikira said.
He added that the push to grow exports to Canada was in line with the national export strategy that outlines the need to upgrade local SMEs production and supply capacity. “The strategy also targets to grow Rwandan exports by 28 per cent every year. Currently, export trade has been growing by 17 per cent over the years,” said Muhikira. According to RDB statistics, exports to North America constitute 3 per cent of total exports, with the largest proportion of exports products to Canada being coffee and tea.
The statistics further indicate that coffee represents 87 per cent of total exports to Canada. However, TFO warned that the exporters will have to contend with consumers who are well informed, demanding and keen to understand the corporate social responsibility programmes of their source producers and the environmental friendliness of their products
Rwanda targets to raise export earnings with the second Economic Development and Poverty Eradication Strategy seeking to more than triple exports revenue from $1.277 billion in 2013 to $4.515 billion in 2018.
Related News
Uganda to gain access into 25 world markets
Ugandan service providers will soon be able to render professional services to more than 25 World Trade Organisation (WTO) member countries, information from the Trade ministry indicates so.
This development was agreed upon in a high level meeting of the WTO Services Council on February 5, held in Geneva, Switzerland.
The meeting was convened to discuss measures which would support the growth of service trade in Least Developed countries (LDCs) through granting services exports with preferential treatment.
Worth noting is that Uganda is the current coordinator for the LDC group at the WTO with the Trade minister Amelia Kyambadde, tasked with the coordinating role.
Quoted in a press statement issued by the ministry, a copy of which the Daily Monitor has seen, Ms Kyambadde said this is a chance for Uganda and other LDCs to expand their export base, particularly in services, to the developed WTO member countries. The development also means that professionals like the doctors, teachers, nurses and accountants, and the like can render services to these countries without being subjected to prohibitive trade demands.
For example, Turkey, one of the 25 countries said it is willing to grant visas to Ugandan and the other professionals from the (LDCs) within 10 minutes upon completion of the online visa application. The press statement named the European Union, Australia, Norway, India, Mexico, Brazil, China, Canada, Japan, Korea, New Zealand and Turkey as some of the countries that made their offers known—granting market preferential treatment (waiver) to Uganda and other LDCs in service trade.
While addressing the February 5 meeting, Ms Kyambadde said with the waiver, the LDC group has moved a step in implementing the operationalisation of the services waiver; one of the milestones set out at the Bali Ministerial Conference in 2013. The Minister reminded members that during the Bali Ministerial Conference in 2013, WTO trade ministers recognised the commitment to grant preferential treatment to LDCs’ services and services suppliers in the form of a waiver and therefore decided to operationalise the decision. The services waiver to LDCs was granted in 2011 during the 8th WTO Ministerial Conference with duration of 25 years. However, three years elapsed without any offer from the WTO members from the developed and developing countries.
During the Bali Ministerial Conference in December 2013, the ministers agreed to operationalise the services waiver so that members would make offers.
The private sector players this newspaper spoke to, though excited about the development, were non-committal, saying it’s too early to understand how this will work, let alone determine its impact.
simplifying access
Ms Kyambadde had also asked for simplification of market access and quotas; preferences in administrative areas such as reducing procedures, reducing fees and paper work for visas, work permits, resident permits where LDCs services suppliers have an offer or obtained a contract.
Related News
China-Kenya bilateral trade in 2014 rises 53 pct
Bilateral trade between China and Kenya rose 53 percent to a record high of 5.009 billion US dollar in 2014, Chinese Ambassador to Kenya Liu Xianfa said on Monday.
The ambassador told reporters that last year China's agreed investment in Kenya increased 10.2 percent to 592 million US dollars, and Chinese projects worth 3.472 billion US Dollars were under construction in Kenya, a growth of 67.7 percent in capital. The two countries have created lots of win-win achievements in the past year, and the bilateral tie has become a model for mutually beneficial cooperation between China and Africa, said the ambassador.
China is now Kenya's largest trading partner and source of direct investment.Last year, Chinese Premier Li Keqiang visited Kenya to foster closer ties. During Li's visit, the two countries signed a co- financing deal to build a major railway linking the Kenyan capital Nairobi with the port city of Mombasa, the biggest infrastructure project since Kenya's independence. The railway will replace a narrow-gauge track built over 100 years ago during British colonial rule, and is expected to extend eventually to Tanzania, Uganda, Rwanda, Burundi and South Sudan.
Construction work on the standard gauge line has started since the beginning of this year, and up to 30,000 local personnel would be recruited, according to the ambassador. The high speed line will boost regional trade, create employment opportunities and deepen integration in East Africa when it is put into service, he said.
Related News
Power outages dim economic outlook
The ailing economy is expected to take a further beating as the country battles its worst power outages in seven years because of surging demand for electricity. Eskom has been struggling to keep the lights on since November with consumer demand repeatedly eclipsing supply.
Now, with heavy industry told to reduce consumption by at least 10% and the country’s growth forecast revised downward, the government is scrambling to allay investor jitters and calm public angst. Government was warned as far back as 1998 about a possible system collapse in a policy document presented to parliament. But it was only in 2007 that work began at Medupi to build the country’s first new power station in 20 years. The first unit of the 4,764MW facility was initially expected to deliver power in 2012, but numerous delays have since pushed that deadline to June this year.
"The potential impacts that load-shedding will have on business, business confidence and consumers alike is inestimable," South Africa Chamber of Commerce and Industry president Vusi Khumalo said. Steel and Engineering Industries Federation of Southern Africa (Seifsa) chief economist Henk Langenhoven estimated that electricity disruptions could slash production by 23%. He said the detrimental effect of insufficient power and the "cumulative effect of the uncertainties does not bode well for 2015". In January the Reserve Bank revised its 2015 growth forecast down from 2.5% to 2.2% — specifically fingering the electricity woes.
Reserve Bank figures show that after a quarter-to-quarter decline of 4% in April-June, manufacturing production contracted at a rate of 3.4% in the next three months. At 24.5%, unemployment remains the elephant in the room for the government. "As long as the power crisis is still with us, I don’t see how the country can manage growth and create jobs," said Free Market Foundation economist Loane Sharp. Mr Sharp estimated the outages would shave off 0.4% of gross domestic product (GDP) growth this year. "This situation is going to have long-term effects on growth. It’s worrying," he said. "The system will remain tight for the next two to three years, when our new power stations are fully operational," Eskom spokesman Khulu Phasiwe said.
Related News
Afreximbank announces business forum to support Egyptian exports
The African Export-Import Bank (Afreximbank) has announced plans to hold a one-day business forum in Cairo on 24 February, 2015 aimed at promoting improved trade between Egypt and the rest of Africa.The forum, which will be organised in collaboration with the Ministry of Industry, Trade and Small and Medium-sized Enterprises of Egypt, has the theme “Unlocking Africa for Egyptian Businesses”.
A statement by Afreximbank said in a statement in Cairo that the forum would enable Afreximbank to present the outlines of a $500-million special trade finance programme it plans to introduce to support Egyptian businesses trying to do business with other African countries. “This programme will provide financing to Egyptian businesses for exports to and imports from any of Afreximbank’s 37 member countries and will support projects being promoted by Egyptian entities in the member countries,” said Dr. Benedict Oramah, the Executive Vice President of Afreximbank in charge of Business Development and Corporate Banking.
The goal of the programme is to reduce the impediments that hinder trade between Egypt and the rest of Africa, particularly those related to access to finance, management of payment, country risks and market access, the Executive Vice President said. Mounir Fakhry Abdel Nour, Minister of Industry, Trade and Small and Medium-sized Enterprises of Egypt, highlighted the importance of industrial partnerships and joint investments involving Egyptian businesses in creating job opportunities and said that the coming period called for a bigger role for the private sector in ensuring sustainable development in the countries of Africa.
According to the statement, Jean-Louis Ekra, President of Afreximbank, will make an opening statement at the forum, while Mr. Nour and Hisham Ramez, Governor, of the Central Bank of Egypt, will delivered keynote speeches. The forum will also feature presentations on trade finance in an emergent Africa and on Afreximbank programmes and facilities in addition to two round table discussions focusing on opportunities and challenges faced by Egyptian businesses exporting to or importing from other African countries and on the solutions available through Afreximbank.
It added that members of the Egyptian business community, including representatives of Egypt’s 13 export councils, the chambers of commerce, the Egyptian Businessmen’s Association, the Egyptian Junior Business Association, and Egyptian commercial banks involved in the export sector would be participating in the forum.