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tralac’s Daily News Selection
The selection: Friday, 7 October 2016
Starting on Monday, in Antananarivo: COMESA Summit to address integration challenges
The top decision-making organs of COMESA are scheduled to begin meeting (Monday 10 October) in Antananarivo, Madagascar ahead of the 19th Heads of State Summit on 18-19 October. The implementation of the decisions that have made by the Council of Ministers in the past which member States have not yet domesticated will be addressed. The meetings will be seeking to establish the challenges member States face with a view to assist them. Some of these include the Protocol on Gradual Relaxation and Eventual Elimination of Visas (Visa Protocol) which have been ratified by all Member States but the implementation has been slow. The same applies to the Protocol on Free Movement of Persons, Services, Labour and the Right of Establishment and Residence (Free Movement Protocol).
Other decisions expected from the policy organs meetings will be on the how to energize the implementation of the Tripartite Free Trade Area. Launched in June 2015 in Egypt, 17 countries out of the 26 in COMESA, the East African Community and the Southern African Development Community have so far signed the agreement but none has ratified. The COMESA Council of Ministers which meets on 13-14 October 2016 is expected to provide policy direction on how to hasten the pace of the implementation of the tripartite agreement.
African constituency statements at International Monetary and Financial Committee meeting:
Statement by Pravin Gordhan (Minister of Finance, South Africa, pdf): We welcome the continued focus on structural reform needs for developing countries and look forward to the finalization of a toolkit that will guide the identification and prioritization of reforms, and we re-iterate that these efforts must take country-specific macroeconomic circumstances and structural factors into account. We support the integration of macro-critical issues such as those pertaining to inequality and gender; and we look forward to finalization of the ongoing work on harnessing the demographic dividends in sub-Saharan Africa. Although we take note of the Fund’s work on trade integration in the region, we encourage a more focused effort to enhance the Fund’s contribution to achieving this goal. We support the development of a framework that will help countries identify fiscal space, and look forward to the integration of the analytical framework within Article IV consultations. Similarly, we welcome the integration of climate change issues in the Fund’s surveillance. Nevertheless, we urge that Fund surveillance includes more analysis of spillover effects of developments in advanced economies on frontier economies that are becoming more integrated to international market, as well as spillovers across the region as economies become more interconnected.
Statement by Rosine Coulibaly/Sori (Minister of Economy, Finance and Development, Burkina Faso, pdf): That said, we share the view that Fund’s surveillance should better integrate the effects and implications of climate change and security challenges given their potential macroeconomic nature. Moreover, the Fund has a toolkit on economic diversification and structural transformation which, based on the persistent dependence of many LICs on commodity exports, does not seem to fulfill its objective. Thus the Fund’s own agenda should include a stocktaking in the use of this toolkit by member countries.
Statement by Mukhisa Kituyi (Secretary-General, UNCTAD, pdf): However, even if the access to developed countries markets can and should be improved, this will not solve the problem of subdued demand from those economies. Developing countries cannot excessively rely on those markets, and need to seek instead a more balanced approach by strengthening both domestic and regional markets. In several regions, strengthening regional integration can be an important instrument for production upgrading and diversification. This is particularly true in Africa:
Trade regulators must strike a delicate balance (UNCTAD)
Regulators must strike a delicate balance between protecting consumers and the environment on the one hand and not restricting trade on the other, a top UNCTAD official said on Wednesday at a meeting on trade regulations. "Regulations should be designed and implemented in smart ways that maximize non-trade objectives – that is to protect consumers, the environment, plants and animals – while not negatively impacting the movement of goods and services," UNCTAD Secretary-General Mukhisa Kituyi said. "We have to find a balance between improving smart regulations and the facilitation of trade," he said. As tariffs have fallen to historic lows, NTMs have continued to grow. They now affect some 96% of global trade. [View the presentations from this week’s NTM/PRONTO expert meeting]
South Africa: Government asked to challenge bid to block US imports (IOL)
The United States government has asked the South African government to challenge an attempt by South African poultry and pork producers to once again block US imports of those products into South Africa. The SA Poultry Association (SAPA) and SA Pork Producers Organisation (SAPPO) have gone to court seeking orders which would block the imports again. SAPA and SAPPO said lifting the health restrictions has exposed South African consumers to salmonella bacteria in US chicken porcine reproductive and respiratory syndrome in US pork. Last week, James Sumner, president of the US Poultry and Egg Export Council said if SAPA and SAPPO won their court cases and US poultry and pork imports were again blocked, “it probably would – and should – trigger another out-of-cycle review under AGOA”.
US complains of disadvantage as EU-SADC trade deal kicks in (Business Day)
In a briefing on Thursday, Laird Treiber, economic counsellor at the US embassy in Pretoria, characterised the disadvantage "significant", affecting "maybe a couple of hundred" products. USTR Michael Froman pressed Trade and Industry Minister Rob Davies on the need to negotiate a more reciprocal trade relationship when African trade ministers met in Washington last week to discuss the future of the African Growth and Opportunity Act. A senior US trade official said Davies’s response had been disappointing.
Nigeria not gaining from international trade agreements – expert (Vanguard)
Dr John Isemede, an international trade expert with UNIDO, says Nigeria is really not gaining from its international trade agreements. Isemede told newsmen in Lagos that many of Nigeria’s trade agreements had even worked to its disadvantage due to poor export capacity in non-oil and low industrial capacity. Isemede said that that the best way out of economic recession would be to look inwards and utilise resources from all 774 local governments across the country to create jobs and food security. “Nigeria currently has signed more than 100 trade policies in the last decade, none of which has impact, because we lack adequate capacity unlike our other countries in these agreements. There is a need to review trade agreements and policies at this time because most of the developed countries we see today grew by closing down their borders for a while."
Namibia invested N$110 billion in SA last year (The Namibian)
Namibia invested N$110 billion in South Africa last year in the form of pension funds, long-term insurance and other investments, President Hage Geingob told an investment meeting in Johannesburg yesterday. “I must, however, note that the trade deficit disproportionately tilts in favour of South Africa. In 2014, Namibian imports from South Africa were recorded at N$51 billion, while exports to South Africa were recorded at N$8 billion,” he stated. Last year, the trade deficit widened, and imports were recorded at N$62 billion, while exports totaled N$11,4 billion. [Invest in Namibia 2016 conference (8-9 November): Promoting investment for inclusive growth and industrialisation]
Nine Angolan ministers prepare Angola/China investment forum in Luanda (MacauHub)
In addition to the Minister and Chief of Staff of the President, Manuel da Cruz Neto, the commission includes the ministers of Finance, Interior, Planning and Territorial Development, Economy, Industry, Energy and Water, Transport and Trade, as well as the governor the National Bank of Angola and other government officials linked to attracting private investment. The Angola/China investment forum, to be held in Luanda later this year, aims to “enhance the development of synergies for the promotion of business partnerships and investments between businesspeople from both countries,” the document said.
Mauritius: Tea sector support scheme launched (GoM)
The tea sector support scheme to give a new boost to the tea industry was launched yesterday at Nouvelle France by the Minister of Agro-Industry and Food Security, Mr Mahen Seeruttun. In the 80’s, Mauritius used to produce some 8 000 tonnes of tea annually but now we produce some 1 500 tonnes only and exportation brings a turnover of around Rs 13 million only to the economy, recalled the Minister, adding that this scheme will help better contribute to the development of the sector. A Chinese businessman has already invested some Rs 200 million for the opening of a tea factory in Mauritius, he added. Moreover, the Ministry of Agro-Industry and Food Security will work with the Tea Research Institute of China for the diversification of the tea industry and the production of new tea varieties.
ZimTrade conducts market survey in DRC (NewsDay)
ZIMTRADE, the country’s export promotion body, is currently conducting a market survey in Lubumbashi, Democratic Republic of the Congo, to identify trade and investment opportunities for Zimbabwean products and services. The survey, ZimTrade said, would also provide Zimbabwean companies with verified information on potential business counterparts, off-distribution channels, payment systems and customs procedures among others.
Kilifi could have biggest port in East Africa, Governor Kingi says (Daily Nation)
Addressing hundreds of investors and delegates at the start of the three-day Kilifi County International Investments Conference at Pwani University on Thursday afternoon, Kilifi Governor Amason Kingi said the port, if established, would open avenues for more investment opportunities in the region. “It will be able to decongest the Mombasa port, giving investors and businessmen an opportunity due to its logistical location. It will also harbour industrial parks processes zone and other components found in infrastructure,” said Mr Kingi said, while addressing investors at the conference.
Trends in remittances, 2016: a new normal of slow growth (World Bank)
Sub-Saharan Africa: Remittance flows to the region are projected to decline by 0.5% in 2016, compared to the 0.8% decline of 2015. Faced with weak earnings from commodity exports and other balance of payments difficulties, many countries in the region – Angola, Nigeria, Sudan, for example – have imposed exchange controls. Nigeria, which accounts for two-thirds of the regions’ remittance inflows, is projected to register a decline of 2.2% in 2016 following a 1.8% decline in 2015. A significant parallel market exchange rate premium - in September 2016, the market rate was around 450 Nairas/$ compared to the official rate of around 320 - has dampened flows through the official channels. Flows to Nigeria, Somalia and other countries in the region are also impacted by a disruption to the services of many money transfer operators due to de-risking behavior by international correspondent banks.
World’s food import bill expected to fall 11% on back of record harvests (FAO)
With prices for most of the internationally-traded agricultural commodities, especially for the staple grains remaining relatively ‘low and stable,’ it is expected the global food import prices will fall to a six-year low, the UN agricultural agency said today. The agency noted that the value of total food imports is expected to fall 11% (in US dollar terms) in 2016 to 1.168 trillion, as lower bills for livestock products and cereal-based foodstuffs more than offset higher bills for fish, fruit and vegetables, oils and sugar.
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