tralac Daily News

Sam Smith News 24 July 2024

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tralac Daily News

24 Jul 2024Daily News

Minerals Council South Africa supports beneficiation where the economics make sense (Engineering News)

Minerals Council South Africa, whose members account for 90% of this country’s yearly mineral production by value, supports beneficiation where the economics make sense. “Therefore, we welcome the call for a more conducive policy environment for beneficiation processes,” Minerals Council CEO Mzila Mthenjane stated in a media release to Mining Weekly. However, the council emphasised the need for careful and strategically informed consideration of an export tax or other restrictions on primary raw mineral exports.

Under conditions where South Africa did not have a comparative advantage to beneficiate a certain mineral – such as specific technical expertise in a particular field of beneficiation; abundant, cheap electricity; a modern, cost-competitive manufacturing base; or globally competitive labour – the unintended consequences of export restrictions might entail lower mining production as the erosion of returns on primary extraction were eroded, the release noted.

Orange export expectations drop lower as severe weather threatens volumes (Engineering News)

The Citrus Growers’ Association of Southern Africa’s (CGA’s) Orange Focus Group (OFG) has revised its forecast export figures for Navel and Valencia oranges further downward owing to extreme weather events in prominent growing regions. The group’s expectation for Navel oranges decreased from 25.6-million 15 kg cartons in May to 22-million cartons in June and 21-million cartons on July 24. The latest review brings the total reduction for the season to a significant 19%.

Last year, South Africa packed 24.8-million cartons of Navel oranges and 52.1-million Valencia oranges for export to foreign markets. CGA vice-chairperson Jan-Louis Pretorius says there will not be an oversupply of oranges this season, rather it will be a balanced market.

Kenya top recipient of AfDB funding in East Africa (Business Daily)

Kenya tops the East and Central African region as the biggest beneficiary of funding from the African Development Bank (AfDB) over the last decade. Data from the pan-African lender shows that AfDB approved a total of $3.718 billion (UA2.77 billion) to Kenya between 2013 and 2023 followed by $2.83 billion (UA2.11 billion) to neighbouring Tanzania and a further $1.81 billion (UA1.35 billion) to Rwanda.

Sectors such as energy, road construction, and water have been some of the biggest beneficiaries of the billions of dollars from AfDB, making the pan-African lender an integral development partner of Kenya. “Approvals for East Africa amounted to UA 2.29 billion, or 29 percent of total approvals, a substantial increase of 37 percent over the UA 1.67 billion in 2022,” AfDB says in its annual report for last year. Some of the big projects that AfDB has funded in Kenya include the 300-megawatt Lake Turkana Wind Power Project – the biggest wind farm in Africa, the ongoing Last Mile Connectivity electricity project, and the Sh16.7 billion dualing of the Kenol-Sagana-Marua Road.

Kenya, like most other African countries, has over the years increasingly turned to AfDB for billions of dollars to fund projects across different sectors. AfDB exclusively lends to African countries, with the continent’s shareholding of the bank being 60 percent. The US, Japan, India, and others own the remaining 40 percent.

New Country Partnership Framework for Cameroon to Focus on More Jobs, and Effective Service Delivery for All (World Bank)

The World Bank Group (WBG) announced a new Country Partnership Framework (CPF) for Cameroon, which will focus on two high level outcomes: more and better jobs, and more effective and inclusive service delivery institutions, with a special attention to climate and fragility. The new Cameroon CPF covers the FY2025-29 period and is aimed at supporting the country’s Vision 2035 of becoming “an emerging country, democratic and united in its diversity.” It lays the foundations for economic transformation to benefit every citizen.

“We recognize the leading role of Cameroon in supporting stability and acting as the economic engine of the region. A key focus of our engagement is to create more and better jobs, particularly for the youth, as a driver for improving the living conditions of the Cameroonian population at large and preserving social cohesion,” said Cheick F. Kanté, World Bank Country Director for Cameroon.

“The private sector has a key role to play in expanding renewable energy solutions, enhancing agricultural productivity, bridging the infrastructure gap, and increasing financing for micro, small, and medium enterprises (MSMEs) in Cameroon,” said Dahlia Khalifa, IFC’s Regional Director for Central and Anglophone West Africa. “Now more than ever, IFC is fully committed to helping the Cameroonian private sector achieve its full potential to lead the economic growth in the country.”

‘We Must Not Kill Local Industries,’ AfDB’s Adesina Backs Dangote Refinery (Channels TV)

The President of the African Development Bank (AfDB) Akinwunmi Adesina has faulted the claims of “monopoly” against the chairman of the Dangote Group Aliko Dangote. Dangote has in recent weeks been in a face-off with Nigerian authorities over the Dangote Refinery project and has also been accused of making inferior products. In the wake of the impasse, he said the group’s board of directors has halted plans to invest in Nigeria’s steel industry “to prevent accusations of being branded a monopoly”. While reacting to the development, Adesina described it as shocking and creating a bad image for Nigeria globally.

“In a nation that has been importing refined petroleum products for several decades, the abnormal simply became very normal. No smart investor would make a $19.5 billion investment and want it to be undermined by importers. “To manufacture is extremely expensive and risky. This is even more so in Nigeria, given the very challenging business and economic environment, fraught with policy uncertainties and policy reversals, and where the self-defeating default mode of “simply import it” is always so easily rationalized and chorused to solve any problem. “We cannot and must not undermine, disparage or kill local industries, talk less of one that is of this scale — a jewel of industrialisation in Nigeria”

Tripartite trade area comes into force tomorrow (Tanzania Daily Times)

The COMESA-EAC-SADC Tripartite Free Trade Area (TFTA) Agreement, will come into force tomorrow, following the attainment of the required threshold. The entry into force of the agreement follows the depositing of instrument of ratification by Angola on June 25th this year that made the total number of the instruments of ratification deposited to be 14, the number which enables the agreement to enter into force.

The Executive Secretary of SADC and current Chairman of the Tripartite Task Force, Mr Magosi said that the member states that have already deposited their instruments of ratification include Angola, Botswana, Burundi, Egypt, Eswatini, Kenya, Lesotho, Malawi, Namibia, Rwanda, South Africa, Uganda, Zambia and Zimbabwe. He said those countries together accounted for 75 per cent of the Tripartite GDP in 2022. In addition, he said that Djibouti notified the COMESA Secretariat that it had ratified the agreement during the meeting of June 20 this year.

For her part, the EAC Secretary General, Ms Nduva stressed the need to consolidate the tripartite FTA through the agreement’s implementation, to harness potential benefits, preserve gains and strengthen the participation of member states in the AfCFTA. She said that EAC was continuously engaging EAC partner states that are yet to ratify the agreement. “Tanzania reported that it was in the process of ratifying the agreement while South Sudan reported that it had begun the process of signing and ratifying the agreement,” she noted.

On his side, the Secretary-General of COMESA, Chileshe Kapwepwe appreciated the efforts that have achieved the required number of ratifications for the tripartite FTA. “To support the AfCFTA, we must ensure the tripartite works effectively. I urge the Tripartite RECs to lead the work under their respective pillars to avoid duplication of efforts,” said Kapwepwe.

SADC Industrialisation Week – Science, Technology, Innovation and Youth (sardc)

Southern Africa has a vast knowledge dividend in its youthful population that can take the region into the future by investing in science and innovation to build an economy anchored on industrial development. This is a key message as Zimbabwe prepares to host the 44th Summit of Heads of State and Government of the Southern African Development Community (SADC) and related to that, the 7th SADC Industrialisation Week.

The Industrialisation Week has been convened annually since 2016, bringing together public and private sector representatives and researchers to discuss ways to accelerate regional integration, enhance trade within the region and the continent, and increase investment. It aims to advance the SADC Industrialisation Strategy and Roadmap 2015-2063, and identify projects that can be implemented jointly by the public and private sectors in the 16 member states.

AfCFTA Implementation: CSOs urged to hold African leaders accountable to remove trade barriers (GhanaWeb)

Dr Fareed Arthur, National Coordinator, of the African Continental Free Trade Agreement (AfCFTA) office, has urged Civil Society Organisations (CSOs) to hold African leaders accountable to remove trade barriers and enhance the effective implementation of AfCFTA in the region. He said the Guided Trade Initiative, which was launched two years ago by the AfCFTA Secretariat with support from the National AfCFTA Coordination Office, had brought several challenges that needed to be resolved.

“These challenges include issues with standardisation, the prevalence of non-tariff and technical barriers, and legal contradictions at country levels,” he said. Dr. Arthur emphasised that CSOs had the vested interest and capacity to hold African leaders accountable to push for the removal of trade barriers that prevented Africa from realising its full potential. He said this at a side event to commemorate the 20th anniversary of the Economic, Social, and Cultural Council (ECOSOCC), which was held in Accra. The anniversary was under the theme: “Celebrating Two Decades of Citizen Engagement and African Solidarity.”

Kenya, Tanzania reach ‘power-sharing’ deal to lead Africa climate negotiations (The East African)

Kenya and Tanzania have struck a ‘power-sharing’ deal that will see them co-chair the African Group of Negotiators (AGN) for a period of two years, with each country being in the driver’s seat for a year. This means that Kenya will be at the helm of AGN in 2024-2025 during the world’s biggest climate meet (COP29) that will be held in Baku, Azerbaijan, later this year, after which Tanzania will take over for 2025-2026 period. The new power-sharing agreement was signed on the sidelines of the United Nations Framework Convention on Climate Change (UNFCCC) meetings in Bonn, Germany.

African Heads of State and government called for an African common platform prepared by the AGN at the African Union Summit in February 2009.This common platform was adopted by AMCEN as part of the Algiers Declaration of May 2009.Last year, Kenya won the hotly contested election, getting seven votes out of 14. Tanzania got four votes while Rwanda got one. The election was conducted virtually after being postponed during the world’s biggest climate meet (COP28) held in Dubai, UAE.

Deputy Minister Godlimpi to attend BRICS Trade Ministers Meeting in Russia (the dtic)

The Deputy Minister of Trade, Industry and Competition, Mr Zuko Godlimpi has departed for Russia tomorrow where he will attend the 14th BRICS Trade Ministers Meeting in Moscow, on 26 July 2024. The Trade Ministers meeting will be preceded by a roundtable discussion with the theme “The Place of BRICS in the New Architecture of the International Economic System”.

Trade Ministers from Brazil, Russia, India, China, South Africa, Egypt, Ethiopia, Iran and the United Arab Emirates are expected to attend the meeting. The meeting is part of a series of meetings that Russia is hosting as part of the build-up to the BRICS Summit that will take place in Kazan, Russia in October 2024. The BRICS Contact Group on Economic and Trade Issues Meeting, which will be attended by senior officials from the Department of Trade, Industry and Competition (the dtic), will take place before the BRICS Trade Ministers Meeting.

Russia and Tanzania are set to do away with the dollar for trade (Business Insider Africa)

Andrey Avetisyan, told the Russian newspaper, Sputnik that the shift to trading in national currencies including the currencies of China, India, and other BRICS nations is under discussion. “The prospects of transition to trade in national currencies are being discussed between our banks,” the ambassador stated on the sidelines of the Valdai Discussion Club conference in Tanzania on Wednesday.

“If Tanzanians see that Russia’s trade with China and India is almost entirely in national currencies, and India and China are Tanzania’s largest trading partners, then there are opportunities here. Indian rupees, Chinese yuan and Russian rubles, I think, can be used by Tanzanians for offset schemes,” he added. The Russian ambassador talked about the possibility of payments in other BRICS currencies. He explained that the UAE, as a key partner of Tanzania, may also incorporate its currency, allowing the dirham, rupiah, yuan, and ruble to be mutually traded and complimented.

GNU gives SA a honeymoon period over Agoa status (Daily Maverick)

The formation of the Government of National Unity (GNU) has secured South Africa a “honeymoon period” for retaining its privileged access to US markets under the African Growth and Opportunity Act (Agoa). This is the view of US politicians and South African trade analysts on the eve of the annual Agoa Forum which runs from Wednesday, 24 July to Friday, 26 July in Washington.

South Africa’s continued participation in Agoa and its good diplomatic relations with the US generally have been under attack in the US, mainly from conservative Republican members of Congress — though with some Democratic support — who have tabled legislation that would oblige the Biden administration to conduct a comprehensive review of US-SA bilateral relations that includes an assessment of whether SA is undermining US national security and foreign policy interests. This could jeopardise SA’s continued participation in Agoa.

Secretary Antony J. Blinken At the AGOA Private Sector Forum, July 24, 2024 (United States Department of State)

“As we approach the renewal deadline next year, President Biden and our entire government fully support reauthorizing AGOA, and we’ll continue working with our colleagues in Congress to make that happen.

“We’re also focused on modernizing AGOA, to reflect how our countries and our economies and international markets have evolved since the law was first passed. We see value in an AGOA that is agile, that’s adaptable, that’s capable of driving trade forward in a dynamic environment. Whether we’re trying to meet the challenges of the climate crisis, prepare for the next pandemic, respond to shifts in global demand, we want AGOA to be ready – ready to support the businesses and the economies of the future.

“In all of this, the private sector is the essential partner. We can’t deliver for our people on issues that matter most without your talent, without your innovation, without your investment. That’s why, at the Africa Leaders Summit, we committed to growing our collaboration with the private sector – through, but also beyond, AGOA.”

Testimony of Florizelle Liser at the Hearing on the African Growth & Opportunity Ac, July 10, 2024 (Corporate Council on Africa)

“As AGOA’s current authorization nears its expiration in 2025, I would encourage the Committee to take account of AGOA’s importance in the overall U.S.-Africa strategic relationship, and would offer four main points for your consideration today.

“The first is about the broader context in which today’s discussion of AGOA renewal takes place. Africa in 2024 is very different than the Africa of 2000, when AGOA first went into effect. Through the African Continental Free Trade Agreement (AfCFTA), African countries are creating a much more harmonized and unified market by reducing and removing both tariffs and non-tariff barriers. This is making it much more commercially feasible for African companies and others sourcing from Africa (like the United States) to create the networks and regional value chains that will make African suppliers more competitive and diversify out of China, while also expanding intra-African trade as well as the continent’s trade with global partners like the United States.

Analysis: AGOA Reauthorization Offers an Opportunity for Expanded Commitments to Development, Labor, and Climate in Sub-Saharan Africa (Center for American Progress)

Standard Bank highlights economic development prospects of Agoa (Engineering News)

Standard Bank Corporate and Investment Banking client coverage head Anne Aliker highlighted the vast potential for mutual partnerships and prospects for economic development of Agoa. She similarly highlighted the value of international trade and infrastructure investments.

“Agreements such as Agoa have driven growth on both continents, including by providing qualified African countries duty-free access to the US market for many goods. While challenges exist, immense opportunities exist for investors who approach with diligence and adaptability,” she said.

“Agoa approaches its current expiry date of 2025, and this is an important moment to explore what steps the US and African countries can take to deepen relations and lay the foundation for enhanced cooperation and mutual benefit,” Aliker said.

“The public and private sector leaders at the forum are looking to burnish economic investments, especially in sectors such as technology, energy, agriculture and healthcare,” Aliker said. Additionally, policymakers should consider using Africa’s markets and resources to help spur more international business. “Implementing changes to Agoa that creates dependable protocols would be beneficial for all parties, as industries rely on consistency,” she suggested.

Claver Gatete Calls for Reform of the Global Financial System to Address Africa’s Financing Challenges (UNECA)

During a joint press briefing on the margins of the recently concluded 2024 High Level Political Forum (HLPF), Mr. Claver Gatete, Executive Secretary of the UN Economic Commission for Africa (ECA), called upon countries to explore reforms to the common debt relief framework to better address rising high indebtedness in Africa. Mr. Gatete said that “the reform of the global financing system is urgent, as it can mitigate access to critical resources needed for the implementation of the SDGs.”

He noted that from 2010 to 2023, Africa’s debt increased by 192 percent according to data by the African Development Bank stating: “African countries are paying $163 billion per year with an external debt stock of $1.1 trillion. This increase is the highest we have ever seen.” “This means that by paying the debt, countries have very little room to implement the SDGs and the next 10-year program of the African Union,” he added.

Mr. Gatete pointed out the need for domestic resource mobilization in Africa to tackle illicit financial flows and improve taxation. He also emphasized the importance of developing capital markets to provide long-term resources as part of private sector engagement in Africa.

African Development Bank expresses strong support for AU Peace Fund revitalization (AfDB)

The African Development Bank has expressed strong support for revitalizing the African Union (AU) Peace Fund, pledging to continue implementing innovative strategies to address fragility and build resilience across the continent.Mrs. Marie-Laure Akin-Olugbade, the Bank’s Vice President for Regional Development, Integration, and Business Delivery, said this during a high-level meeting on Saturday aimed at mobilizing resources for the AU Peace Fund. The event was held on the sidelines of the AU’s 6th Mid-Year Coordination Meeting in Accra.

Akin-Olugbade highlighted various initiatives by the African Development Bank to foster peace in Africa, including providing technical assistance to the Peace Fund. She emphasized the Bank’s focus on developing human capital, strengthening institutions, and promoting inclusive governance alongside infrastructure and economic growth. “These programs not only foster economic growth but also address the root causes of conflict by promoting inclusivity and empowering marginalized groups,” she stressed.

Moussa Faki Mahamat, Chairman of the African Union Commission, announced that the Fund has garnered close to its first target of $400 million, primarily from member state contributions. He commended the countries for their dedication to the Fund, despite facing global challenges. “This achievement reflects members’ unity and determination,” Mahamat said, urging continued momentum to build on these successes.

AI can help provide universal access to energy in Africa (Africa at LSE)

In West Africa, Ghana and Senegal have made strides in increasing electricity access. In Ghana, access to electricity has reached approximately 85 per cent of the population. However, other countries such as Niger still face significant challenges, with less than 20 per cent of its population having access to electricity. In East Africa, Kenya is a leader in renewable energy, with over 70 per cent of its energy mix coming from renewables, and the country’s electricity access rate has risen to around 75 per cent. In contrast, its regional neighbour, Burundi, has a dismal electricity access rate of less than 11 per cent.

Southern Africa countries too, have a wide disparity of energy access: South Africa boasts a relatively high electrification rate of about 89 per cent. However, neighbouring countries like Mozambique and Malawi still face low access rates, with around 30 per cent and 11 per cent of the population, respectively, having reliable electricity access. These regional disparities highlight the diverse challenges and progress within the continent. While some countries are leading the way in energy access, others continue to struggle with significant barriers to achieving universal energy access.

Despite the progress, Africa faces a plethora of challenges in achieving universal energy access. The continent’s energy infrastructure is often outdated and inadequate, failing to meet the growing demand. Political instability, financial constraints, and lack of technical expertise further hinder the expansion of energy services. Additionally, there is a significant urban-rural divide, with rural areas being particularly underserved while urban areas experience frequent blackouts.

AI & sustainable development in Africa, subject matter of meeting in New York (The North Africa Post)

The Group of Friends on Artificial Intelligence for Sustainable Development, co-chaired by Morocco and the United States, organized a high-level event on the opportunities offered by artificial intelligence (AI) to support sustainable development in Africa. The event was held Monday at the UN headquarters, in New York. The meeting was meant to highlight the importance of strategic partnerships and enhanced cooperation in order to improve Africa’s capabilities in AI and to give the continent a say in the global and multi-stakeholder debate on this new technology, its governance, and its benefits.

Professor Amal El Fallah Seghrouchni, Executive President of the International Center for Artificial Intelligence of Morocco known as Ai Movement, within the Mohammed VI Polytechnic University (UM6P), made an exhaustive presentation on the key role of AI in transforming the future of Africa and the potential of this technology to contribute up to 1,500 billion dollars to the African economy, or 6% of the continent’s GDP. “Whether improving healthcare delivery, agricultural productivity, fostering educational inclusion or driving economic growth, AI has already proven itself as a powerful enabler of sustainable development,” she argued.

UN chief urges reform of int’l financial system (The Statesman)

UN Secretary-General Antonio Guterres has called for reform of the international financial system which he described as “outdated, dysfunctional and unfair”. In a video message to the first meeting of the Preparatory Committee for the Fourth International Conference on Financing for Development, which started in Addis Ababa, Ethiopia, on Monday, Guterres said the upcoming conference provides a unique opportunity to tackle financing challenges “head-on” as reported by Xinhua news agency.

The conference, scheduled to take place in Spain from June 30 to July 3, 2025, “opens the door for world leaders to adopt ambitious reforms to deliver affordable long-term financing at scale, and deliver the SDG (Sustainable Development Goals) Stimulus,” said the UN Chief.

“It presents a unique opportunity to reform an international financial system that is outdated, dysfunctional and unfair — from the tax and debt architecture to the system of public development banks, to trade and investment rules, to the financial safety net and global governance,” he added.

Since world leaders met in Addis Ababa nine years ago and agreed on a transformative agenda committing public and private actors to align investment and policies with sustainable development, progress has been made, but many commitments remain unfulfilled, Guterres said.

Digital tax talks in G20 spotlight as US tariff threat looms (Reuters)

Talks over a global tax deal are continuing well past a June 30 deadline and governments are now looking to a Group of 20 finance leaders meeting this week for progress on a stalled plan to reallocate taxing rights on large multinational companies. The stakes in the negotiations are high. A failure to reach agreement on final terms could prompt several countries to reinstate their taxes on U.S. tech giants and risk punitive duties on billions of dollars in exports to the U.S.

Standstill agreements under which Washington has suspended threatened trade retaliation against seven countries – Austria, Britain, France, India, Italy, Spain and Turkey – expired on June 30, but the U.S. has not taken steps to impose tariffs.

Discussions on the matter are continuing. An Italian government source said that European countries were seeking assurances that the U.S. tariffs on some $2 billion worth of annual imports from French Champagne to Italian handbags and optical lenses remained frozen while the talks continue, including at the G20 meeting in Rio de Janeiro.

Inequality stands in the way of the global fight against hunger, FAO tells G20 (FAO)

The climate crisis further negatively impacts food security and nutrition inequality through a decline in agricultural productivity, reduced income, emerging food safety issues, disruptions in food distribution, lower nutrient content of crops, and changes in diet quality, among others. The recent FAO report “The Unjust Climate” found that in an average year, poor households lose 5 percent of their total income due to heat stress compared to better-off households, and 4.4 percent due to floods. Where inequalities are highest, the most vulnerable are less resilient and suffer the most from these shocks. “This is clearly a consequence of reduced resilience and reduced access to assets and infrastructure,” the Director-General said.

Furthermore, the FAO “State of Women in Agrifood Systems” report concluded that women’s access to land, inputs, services, finance, and digital technology continues to lag behind men’s. Discriminatory social norms and rules affecting women and girls are at the heart of gender inequality, and are slow to change. This is why “economic growth and policies directly targeted to reduce inequalities must go hand in hand,” Qu said.

Africa’s trade deficit shrinks as exports to China surge – but experts say it won’t last (South China Morning Post)

Resource-rich African countries have seen heavy investment from Chinese companies as they ramp up mineral production amid the global push for green energy. One such country is Zimbabwe, a major source of lithium, which has had an influx of billions of dollars worth of investments and acquisitions from China in the Asian giant’s push to dominate the lithium-ion battery market. Similarly, the Democratic Republic of the Congo (DRC), which is the world’s largest producer of cobalt and a major source of copper, remains a major source of materials for China’s electric vehicle battery industry. China also imports minerals such as bauxite from Guinea and oil from Nigeria, Angola, Gabon and Ghana.

China’s largest trading partner in Africa is South Africa. In the first half of the year, the value of that trade hit US$27.5 billion, according to Chinese customs data. During that period, imports from South Africa rose 10.7 per cent to US$17.29 billion year on year, but Chinese exports to the African nation fell 18.6 per cent to US$10.2 billion.

Hydrogen Summit channelling capital to critical sectors for rapid project development (Namibia Economist)

Held under the patronage of the Namibian Government and endorsed by the Ministry of Mines and Energy, the inaugural Global African Hydrogen Summit is scheduled to take place from 3 – 5 September in Windhoek. With more than 600 million people across Africa lacking access to electricity, the International Energy Agency (IEA) estimates that Africa will need to double its electricity generation capacity by 2040 to meet growing demand. The continent has been identified as a prime source for renewable energy exports to regions seeking to reduce reliance on fossil fuels and meet net-zero targets.

At the heart of the Global African Hydrogen Summit is the mission to drive critical investments and financing into bankable green energy projects across Africa. As a critical pillar of the Summit, the Project Investment Roundtables will play a pivotal role in accelerating deal-making from origination through to bankability to the transaction to financial close in sectors spanning Hydrogen, Renewables (inc. Wind, Solar, Hydro, Geothermal, and Biomass), Agriculture, Mining, Power, Infrastructure, Heavy Industry, Hard to Abate, Transportation, and Mobility.