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tralac’s Daily News Selection
The selection: Tuesday, 22 November 2016
African trade finance: African bankers urged to counter challenge of withdrawal of international banks (Afreximbank)
With international banks once again withdrawing from African trade finance and with the continent’s trade finance gap estimated at more than $120bn, African banks, have an opportunity to step in, through structured trade finance, to ensure that Africa, never again descends into economic chaos because of a sudden withdrawal of international banks, Dr Benedict Oramah, President of the African Export-Import Bank said. In an address in Port Louis, during the opening of the Afreximbank Annual Structured Trade Finance Seminar and Workshop, Dr Oramah said that unlike in the 1990s, structured trade finance had emerged a well-proven ammunition to deal with the risks presented by the environment, including the tightening of credit conditions, worsening of trade finance conditions and decline in the willingness to supply international trade finance in Africa despite increasing demand.
Roman Grynberg: EU seeks to eliminate aid to Angola, Namibia, Botswana, South Africa after 2020 (The Namibian)
On 22 November, the European Commission was scheduled to issue a communication which, according to normally well-informed sources in both Berlin and Brussels, would bring to an end half a century of aid for the richest 21 ACP countries by 2020, when the current Cotonou Agreement comes to an end. All of Namibia’s neighbours, with the exception of Zambia, will have their aid terminated from 2020 under the 12th European Development Fund. This elimination of aid applies to Angola, Botswana, Namibia and South Africa. The official reason for the cut in aid is that the EU wishes to focus its efforts on the poorest of the ACP states. In the rest of Africa, the countries which will no longer receive national allocations are said to include Equatorial Guinea, Gabon, Mauritius, and the richest country in Africa, Seychelles. Other low-income countries like Zimbabwe will continue to receive EU aid. [Anti-aid Dutch minister set to attend Nairobi donors forum]
Economic Partnership Agreements: In the balance (D+C)
The Economic Partnership Agreements (EPAs) between the EU and three of Africa’s Regional Economic Communities are facing challenges. The EPAs are not only supposed to foster intercontinental trade, but regional integration within Africa too. Critics, however, fear that agreements will hurt regional integration, and ratification has stalled. A new strategic initiative is urgently needed. [The analyst: Helmut Asche]
Kenya’s AG digs in for European trade deal battle at the East African Court (Daily Nation)
Attorney-General Githu Muigai, who is named as the second respondent in the case seeking to block four EAC member countries from signing the EPA, says Nairobi will prepare a solid defence. The case is set for hearing in Arusha on Thursday this week. “We shall seek to persuade the court that Kenya has acted and will continue to act in her sovereign best interest and within the EAC law,” said Prof Muigai in an interview.
Comparing safeguard measures in recent regional and bilateral trade agreements (ICTSD)
This paper, which builds on a previous ICTSD study, provides policy-makers and others with an evidence-based analysis of the implications of recent bilateral and regional trade negotiations for developing countries’ ability to use safeguard measures to protect domestic producers from sudden surges in the volume of imports or price depressions. The study examined 26 agreements which were selected based on various criteria. The sample of agreements is geographically diverse, includes countries from all continents and includes a mix of older and more recently concluded ones in order to evaluate the development of safeguard provisions over time. Furthermore, the sample also includes a mix of North-North, North-South and South-South trade agreements. [The author: tralac’s Willemien Viljoen]
Boost Africa Initiative: a new integrated approach to promote young innovative entrepreneurs (AfDB)
Boost Africa Initiative, a unique partnership in support of innovation and entrepreneurship across Africa was launched yesterday in Abidjan by the EIB and the AfDB in partnership with the European Commission. Boost Africa will contribute to fostering the development of an efficient entrepreneurial ecosystem in Africa by supporting the earliest and riskier stages of the venture value chain, in an economically viable and sustainable way. As a result of an initial combined investment of up to €150m, the Initiative is expected to leverage up to €1bn in additional investments in a high growth sector, and support over 1,500 start-ups and SMEs across the continent. Pan-African in scope, the Boost Africa Initiative has three integrated pillars:
ECA and partners scale-up efforts to tackle illicit financial flows from Africa (UNECA)
A two-day workshop aimed at stakeholders working to confront the challenge of stemming illicit financial flows from Africa yesterday in Nairobi, with the Economic Commission for Africa’s Head of Special Initiatives in the Office of the Executive Secretary, Aida Opoku-Mensah calling for a coherent and coordinated approach on this agenda. “Given the mosaic of actors and ongoing and prospective initiatives on the different dimensions of IFFs at national, regional and global levels, there is need for coherence, coordination and complementary partnerships,” said Ms. Opoku-Mensah at the opening session.
African Union Sub-Committee of Directors General of Customs: WCO input (WCO)
Dr Mikuriya, WCO Secretary General, noted the encouraging developments to ensure trade facilitation and economic competitiveness through the WTO TFA and reiterated the WCO’s active involvement through the Mercator Programme providing tailor-made support to Customs administrations, especially in Africa. Referring to the WCO’s 2016 theme, “Digital Customs: progressive engagement”, he pointed to the critical role played by technology in improving Customs procedures. In this regard, he informed the audience that the WCO would further explore this focus in 2017 with the theme of “Data Analysis for Effective Border Management”. The second day of the meeting included a panel discussion session on OSBP comprising WCO Secretary General Mikuriya and representatives from Cote d’Ivoire, Zimbabwe, the Pan African Parliament, AfDB, and the EAC. [From barriers to bridges: implementing OSBPs for improved trade facilitation]
EALA: press briefing by Daniel F. Kidega, EALA Speaker
We expect some of these key pieces of legislation to be moved within the next few months before we wind down our tenure in June 2017.We are indeed looking forward to January next year when the next Summit of EAC Heads of State will re-convene to conclude the matters around the Economic Partnership Agreements. As an Assembly, we want the EPAs matter handled with utmost care and a suitable decision best for the region arrived at. We appeal to Partner States to speed up implementation of the agreed upon areas. A major challenge the EAC faces today is funding. The matter is so critical that the Assembly and a number of Institutions and Organs literally cancelled or reduced their activities. The remission by the Partner States up to date paints a less than positive picture. [Funding crisis clouds Nairobi session of East African Parliament] [Climate change: EAC six sign Paris Agreement]
Zimbabwe: Up your game, reduce prices, says Bimha (The Chronicle)
Industry and Commerce Minister Dr Mike Bimha says the private sector should take advantage of Statutory Instrument 64 of 2016 to improve production efficiency and reduce prices of their products to achieve competitiveness. Some unscrupulous businesses have started increasing prices of goods and services despite the strengthening of the United States dollar thereby giving room for more imports and smuggling. Minister Bimha told a business gathering during the commissioning of Turnall Holding’s new Eco-sheet product in Bulawayo last Thursday that protectionist measures such as Statutory Instrument (SI) 64 were not sustainable in the long term. [Don’t increase prices: Mnangagwa urges manufacturers]
South Africa: annual report on competition policy developments (OECD)
The 2015/2016 financial year brought significant developments for the South African competition agencies: the Competition Commission of South Africa and the Competition Tribunal of South Africa. On the legislation and policy front, law makers introduced personal criminal liability for directors or managers who knew about or participated in cartel conduct. The new law became effective in May 2016, which was soon after the financial year end, but because of the far reaching implications of this development in South African law we highlighted it in our 2015/2016 annual report, as we do in the pages that follow. The move was not without controversy but the CCSA is working with relevant agencies to bring about a smooth transition into the new criminal dispensation.
Mauritius to sign bilateral trade agreement with Tanzania (GoM)
The Minister of Foreign Affairs, Regional Integration and International Trade, Mr Seetanah Lutchmeenaraidoo, will sign a Bilateral Trade Agreement with the Republic of Tanzania during the forthcoming visit of the Minister for Industry and Trade, Dr Charles John Mwijage, and the Minister for Agriculture, Livestock and Fisheries, Dr Charles Tizeba, of the Republic of Tanzania. The agreement provides for a better coordination in the promotion of trade and commercial transactions and the establishment of a Joint Trade Committee to discuss cooperation in key sectors, such as Investment, Fisheries and Sugar. [Mauritian firm set for Kenya entry with acquisition of Fidelity Bank] [Mauritius: Migrant workers driving manufacturing]
Tanzania: Govt, ATI in $4bn talks (IPPMedia)
As political risk insurance is increasingly gaining importance in the East African region, African Trade Insurance Agency is in talks with the government to pay $4m (900bn/-) in political risk claims by investors. According to ATI’s Chief Executive Officer George Otieno, the ATI will contribute to Tanzania’s current efforts to reduce the cost of doing business by making political risk and credit insurance, as well as non-payment and FDI cover readily available to exporters, importers and investors. He said with a well-established working relationship with the Dar government, the perceived risk on Tanesco will be reduced, banks will be willing to lend to Independent Power Producers, contractors and Tanesco without asking for government guarantees.
Tanzania: Over 2tri/- collected from mining sector (Daily News)
The government has successfully managed to collect 2.12tri/- as income and withholding tax from mining sector in the country from 1998 to 2015, the Acting Commissioner for Minerals in the Ministry of Energy and Minerals, Mr Ally Samaje, has said. Also in the same period, at least 875.9bn/- have been paid to the government by various mining companies as loyalties.
Zambia vies for two positions at AU (Lusaka Times)
Dr Austin Sichinga, a scientist, is vying for the position of Commissioner for Agriculture and Rural Development and Ambassador Albert Muchanga is eyeing the post of Commissioner for Trade and Industry. Ambassador Sikaneta said it is important for Zambia to have representation at such a high level decision making positions of the AU because this helps influence policy decisions of the continental body. Zambia has never had representation at the level of commissioners in the African Union.
UNSC debate on UN, AU cost-sharing proposals
Following a debate on modalities of stronger cooperation on peace and security between the UN and the AU, the Security Council welcomed the regional organization’s efforts to create a predictable cost-sharing structure for the funding of peace-support operations authorized by the Council. Unanimously adopting resolution 2320 (2016), the Council expressed its readiness to consider options in response to the African Union’s proposal to finance 25% of the cost of such operations by 2020. The Council emphasized that consultative analysis and joint planning with the United Nations was critical to developing common joint recommendations on the scope and resource implications of the missions. By that text, the Council also expressed support for the principles of cooperation set out by the High-Level Independent Panel on Peace Operations for the strategic partnership with the African Union. Donald Kaberuka, High Representative of the African Union Peace Fund, noted that previous speakers had highlighted three important facts:
4th Africa-Arab Summit: update
The Joint Council, which included Ministers of Economy, Trade, Finance, and Foreign Affairs, outlined resolutions on the implementation of the Africa-Arab Partnership Strategy, the implementation of the Joint Africa-Arab Action Plan 2014-2016, and the outcome of the resolutions of the III Africa-Arab Summit. The Council also drafted resolution on the coordination for financing future Africa-Arab projects, the implementation of the Joint Action Plan on Agricultural Development and Food Security, and the promotion of the Africa-Arab Cultural Centre. A resolution for the drafting of the Joint Africa-Africa Action Plan 2017-2021 was also presented and will be reviewed over the coming days with an emphasis on bilateral as well as regional relations. The Council proposed the V Africa-Arab World Summit be held in Riyadh, the capital of the Kingdom of Saudi Arabia.
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