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tralac’s Daily News Selection
The selection: Friday, 1 July 2016
SADC finance and economy ministers in Gaborone for peer review meetings (Channel Africa)
Trade, industry, finance and investment ministers from SADC have started a series of regional development peer review meetings which will run from 28 June to 8 July. "The Committee of Ministers of Trade meeting will take place on 5 July 2016. The Ministerial Task Force on Regional Economic Integration comprising, Ministers responsible for Finance, Trade and Infrastructure will meet on 6 July, while the Ministers of Finance and Investment and the Peer Review Panel will be from the 7-8 July" said Botswana Finance and Development minister Kenneth Mathambo.
South Africa: 2016 merchandise trade statistics (SARS)
The R18.73bn trade balance surplus for May 2016 is due to exports of R104.68bn and imports of R85.95bn. Exports for the year-to-date of R451.62bn are 10.2% more than the exports of R409.98bn recorded in January to May 2015. Imports for the year-to-date of R452.28bn are 3.4% more than the imports recorded in January to May 2015 of R437.56bn. The cumulative deficit for 2016 of R0.65bn is 97.6% less than the deficit for the comparable period in 2015 of R27.58bn.
The impact of Brexit: presentation by SA National Treasury (pdf, AgBiz)
Regarding total trade (i.e. both imports and exports), the UK ranked 6th largest trading partner. In 2015, SA exported R41.6bn worth of products into the UK and imported R35bn with a R6.6bn trade balance in favour of SA. Critical to negotiate trade and investment treaties sooner rather than later: SA is largest African trading partner but Africa is a very small part of the UK trade.
Gerhard Erasmus: ‘Some implications of Brexit for Southern African trade relations’ (tralac)
This Trade Brief discusses the trade implications of Brexit for the SADC EPA and will mention some of the related predicaments which the UK now faces. This episode serves as a lesson too of the costs involved in undoing well integrated regional integration arrangements. Southern African governments should ensure that their needs and the continuation of certainty in reciprocal market access arrangements will get the urgent attention which they merit. This will be a difficult task but these are matters which cannot be left to decisions of Her Majesty’s Government alone. We need well thought-through responses and diplomatic initiatives of our own. Technical issues need to be clarified in order to support such initiatives. [J. Peter Pham: 'Africa and Brexit: not all bad news' (Atlantic Council)]
Kenya: Q1 GDP, Balance of Payments report (pdf, KNBS)
In the first quarter of 2016, international merchandise trade balance improved by 25.4% to a deficit of KSh 167,251 million. Domestic export earnings increased by 13.4% to KSh 130,650 million in the quarter under review boosted by growth in earnings from horticulture and tea exports. Overall balance of payments improved to a surplus of KSh 26,318 million from a deficit of KSh 17,063 million in the corresponding quarter of 2015 as shown in Table 5. The current account balance improved by 30.1% from a deficit of KSh 101,539 million in the first quarter of 2015 to a deficit of KSh 71,018 million in the quarter under review. The narrowing of the current account deficit could be explained by the decline in import expenditure and a considerable increase in the value of exports. Cross border services receipts declined by 7.1% while payments increased by 9.0% translating into a surplus of KSh 14,265 million in international trade in services during the first quarter of 2016. Remittances from the diaspora continued to grow in the first quarter of 2016, increasing by 28.4% to KSh 42,777 million from KSh 33,328 million in the first quarter of 2015.
Nigeria-India trade hits $16bn (The Sun)
The trade volume between the Federal Republic of Nigeria and India has hit $16bn, the Indian High Commissioner-designate to Nigeria, B.N. Reddy has revealed. The Indian envoy who spoke in Abuja during the launch of the India-Nigeria Business Promotion Council, said as biggest trading partners in Africa, both countries must share experiences and assist each other in areas of interests. Former Education Minister, Oby Ezekwuesili who also spoke, bemoaned the trade imbalance between Africa and India. She called for its review, while urging the Federal Government to create an enabling environment so that investors can come into the country. “India’s trade with Africa is about $300 billion. Out of that, Africa accounts for about $32 billion,” she added.
Mauritius expects 46% jump in foreign investment in 2016 (Bloomberg)
Mauritius's government expects foreign direct investment to increase as much as 46% this year, even as the United Kingdom’s decision to leave the European Union may curb inflows to the Indian Ocean island nation. Foreign investors are expected to commit 14 billion rupees ($395 million) by the end of 2016, compared with 9.6 billion rupees last year, Board of Investment Chief Executive Officer Ken Poonoosamy said in a phone interview Tuesday from the capital, Port Louis.
Mozambique’s foreign investment slumps 35% in first quarter – Finmin (Club of Mozambique)
Investors brought in $650m in the first three months compared with $1bn a year ago, Finance Minister Adriano Maleiane told members of the ruling Mozambique Liberation Front, or Frelimo, on Wednesday in the capital, Maputo. “Foreign direct investment used to be an important source of foreign exchange, but it’s falling,” Maleaine said. [Minister Tonela appoints 12 new names for Industry and Trade]
Zimbabwe: Cargo stuck as importers struggle for permits (The Herald)
Commercial cargo has been stuck at Beitbridge Border Post for the past seven days as importers struggle to get permits to ship goods that are restricted from Open General Import Licence under Statutory Instrument (SI) number 64 of 2016. The SI tightens screws on the import of basic commodities including food items, building material, furniture, toiletries and cooking oil among other things. Several trucks are stuck on the South African side since the Zimbabwe side has no adequate space to accommodate them. The Herald is reliably informed that the Zimbabwe Revenue Authority has resorted to requesting for a surety of $2 000 from importers.
Zimbabwe: Police roadblocks threat to ease of doing business (The Herald)
National Assembly Speaker Advocate Jacob Mudenda yesterday said there was need for the police to reduce the number of roadblocks as recently pronounced by national police spokesperson Senior Assistant Commissioner Charity Charamba. “We have debated in Parliament and said there is no law that says there should be X number of roadblocks on the road,” he said. “Tourists driving from Beitbridge to here, Victoria Falls, on average must go through 20 roadblocks, why? They have been checked at the border for whatever imagined misdemeanours they might have and they came through Customs and Immigration.”
Tazara: Sh94 billion debt casts dark shadow over Tazara revival (The Citizen)
Outstanding payments amounting to Sh94 billion could stand in the way of plans to revamp the Tanzania-Zambia Railways Authority, The Citizen has learnt. Documents seen by The Citizen show that Chinese investors interested in taking over Tazara want the debt cleared before meaningful investments can be made. This includes delayed payments to suppliers, unpaid pensions for retirees, salary arrears and contributions that have not been remitted to pension funds.
Tanzania: Govt suspends TBS boss (The Citizen)
Tanzania Bureau of Standards Director General Joseph Masikitiko was dramatically suspended yesterday, with the government saying the move was aimed at paving the way for an investigation into unspecified matters. The suspension was announced by the Industry, Trade and Investment Permanent Secretary, Prof Adolf Mkenda, in a statement sent to newsrooms last night. Also suspended alongside Mr Masikitiko was TBS Finance, Planning and Administration Manager Emmanuel Ntely. The communication was issued a few hours after Industry, Trade and Investment minister Charles Mwijage made an unannounced visit to TBS offices in Ubungo, Dar es Salaam.
Akinwumi Adesina: opening speech at 2nd negotiations meeting of the African Development Fund (AfDB)
The Industrialise Africa strategy has just been sent to the Board for approval, and the Integrate Africa strategy will also follow. I am very pleased that in Lusaka we set up a Special Panel – led by former UN Secretary-General Kofi Annan and former German President Horst Köhler, and including other global development luminaries from the public and private sector – which will help us as we roll out the High 5s.
Competitive manufacturing sector can solve issues in SA (IOL)
South Africa is not de-industrialising, but manufacturing is changing. The manufacturing sector is today 15% bigger than it was 10 years ago, 51% bigger than 20 years ago, and 64% bigger than 30 years ago. However, employment numbers have declined alarmingly: 14% fewer people are employed today than in 2005, 23% fewer than in 1995 and 27% fewer than 1984. Confusion arises when the size and share of the economy is mentioned in the same breath. Manufacturing constitutes a diminishing share of the economy simply because other sectors, primarily services, have been growing faster over the same period. According to the SA Reserve Bank, manufacturing’s contribution to the economy has declined from 19.7% in 1995 to 13.7% last year. [The author, Henk Langenhoven, is chief economist of the Steel and Engineering Industries Federation of Southern Africa]
South Africa: Green Paper on International Migration (pdf, Dept of Home Affairs)
Given the policy shortcomings of the current White Paper and much of the legislation based on it, this Green Paper argues that South Africans need to adopt a paradigm that sees international migration as enabling their own development and that of their country and region. In the new paradigm, South Africans would see themselves as responsible citizens of SA, Africa and the world and support efficient, secure and humane approaches to managing international migration. The current paradigm exposes SA to many kinds of risk in a volatile world and by default strengthens colonial patterns of labour, production and trade. It also serves to perpetuate irregular migration, which in turn leads to unacceptable levels of corruption, human rights abuse and national security risks. The current draft of the Green Paper raises issues that require policy interventions in seven broad policy areas. Some of the policy areas are more fully developed than others. [Speech by Home Affairs Minister Malusi Gigaba]
Alan Hirsch: 'Institute will equip future leaders to beat inequality' (Business Day)
Finally, Africa’s growth has not been equal. The income and wealth gaps between countries — as well as the gaps within many countries — are growing. Southern Africa tends to have the most inequality within countries. SA, Namibia, and Botswana are among some of the most unequal countries in the world, and Angola and Zambia are not far off. The average Gini coefficient for Africa is 0.43, which is significantly greater than the coefficient for the rest of the developing world at 0.39. On average, the top 20% of earners in Africa have an income that is more than 10 times that of the bottom 20%. Recently, the London School of Economics established the International Inequalities Institute to identify and support innovative interdisciplinary research and teaching that addresses inequalities, and to create a structure that was agile and flexible enough to accommodate this vision over generations. With generous funding from Atlantic Philanthropies, the Atlantic Fellowship Programme has just been announced, based at the institute. UCT is a collaborating partner.
Alan Roe: 'Like it or not, poor countries are increasingly dependent on mining and oil and gas' (UNU-WIDER)
The UNU-WIDER project on managing natural resources seeks to examine how poor and middle-income countries can best use their natural resource wealth to promote development. It is well understood that minerals, metals, oil or gas (collectively known as ‘extractives’) have for some years been significant in the economies of low- and middle-income countries. What perhaps is less well known is:
Malaysia Economic Monitor: leveraging trade agreements (World Bank)
Sahel and West Africa Club: newsletter, 21-27 June
Innovation prize for Africa 2016: keynote address by President Ian Khama (Mmegi)
World Bank's annual classification of nations by GNI per capita
Asean-5 Cluster Report: evolution of monetary policy frameworks (IMF)
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