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tralac’s Daily News selection
The selection: Thursday, 18 February 2016
Important trade and regional integration policy pointers:
From the African Union’s Trade and Industry department: the 1st meeting of the CFTA Negotiating Forum will be held from 22-27 February in Addis Ababa
From the AfDB - two EOIs:
Intra-African investment and regional financial integration
The African Development Bank has unveiled a landmark initiative (The High 5s, within the context of the Bank’s Ten-Year Strategy) to accelerate Africa's development over the next 10 years. Under this initiative, the High-Five priority areas of focus in Africa - to light up and power Africa, feed Africa, integrate Africa, industrialize Africa, and improve the quality of life for the people of Africa - form a blueprint for African countries to embark on a course of sustainable transformation. The objective of this assignment is to assist the Task Manager and the team on the intra-African investment and regional financial integration initiatives: participate in the drafting of the Approach to Regional Financial and Investment Integration in the SADC region; participate in the drafting of the joint Regional Integration Policy Paper on Regional Financial Integration in North Africa; participate in the drafting of the joint Regional Integration Policy Paper on Regional Financial Integration in Central Africa.
ECOWAS: developing a common policy on migration
As part of the efforts at deepening integration, in 1979 ECOWAS ratified the Protocol on Free Movement of Persons and subsequently waived visa requirements and adopted a common passport to enhance movement of community citizens. In spite of the progress that ECOWAS have made in the area of migration, the Community still faces a number of challenges, including the pursuit of conflicting objectives by member states and weak implementation of the Protocol on Free Movement, especially the rights of residence and establishment – due in part to the absence of strong regulatory framework on migration. The ECOWAS Commission has recognised that a key way of overcoming these obstacles is the drafting of a common policy on migration. The objective of this assignment is to deliver technical assistance to the ECOWAS Commission that will contribute to achieving the following:
South Africa: African trade and regional integration update by Minister Patel (ANC)
To support jobs through regional integration, we are focusing on markets on the continent. Last year for the first time other African countries became our single biggest regional market, overtaking Asia. We exported R303bn worth of goods to other African countries. These supported roughly 250 000 South African jobs. For example, half of the trucks we export, go to the rest of Africa and 60% of fruit juice exports is to our own continent. We will now work on deeper regional integration by private and public sector co-investment in other parts of the continent and support for a big infrastructure push in the continent, covering key projects such as the North South corridor that links the continent by road and rail; the big water and energy projects such as the Lesotho Highlands Water Project and working on Grand Inga with the DRC.
Namibia to address WTO in bid to save livestock industry (New Era)
Namibia is to send a high-powered delegation from all sectors of the livestock and meat industry to Geneva to present its case before the Sanitary and Phyto-Sanitary (SPS) Committee of the World Trade Organisation from March 16 to 17, in a bid to oppose soon-to-be-announced livestock import restrictions by South Africa. It is expected that South Africa will adopt the new restrictions before the end of February, after which the regulations will be implemented six months later. Namibia is now preparing to address the SPS Committee to acquire some breathing space before the implementation and to activate its own Master Plan after the Livestock Producers Association of Namibia and the Namibian Agricultural Union last week officially requested President Hage Geingob to intervene and save the industry.
Botswana, South Africa, Zimbabwe: development of the animal feed to poultry value chain (UNU-WIDER)
The cross-country investments being made by large poultry companies in the region indicate that a degree of regional integration is being fostered by firms in the region, largely in the absence of agreements between neighbouring states and in spite of barriers to trade that have been put in place. However, the predominance of large firms in the value chain also raises important questions about the strategies lead firms are pursuing, including vertical integration and agreements, and the implications for the development of local and regional agro-processing capabilities. Two important aspects of industrialization in the poultry value chain—upgrading of feed and breeds, and co-ordinated investments across the region—have been led by large firms. [The authors: Phumzile Ncube, Simon Roberts, Tatenda Zengeni]
Egypt: Prime for investment, COMESA countries must be more than export market (Daily News)
Exchange between Egypt and COMESA countries in 2014 amounted to about $2.7bn. Egyptian exported goods worth over $2bn including plastic products, ceramics, and electrical appliances. Egypt also imported tea, coffee, copper, and livestock worth about $700m from COMESA member countries in 2014. Egyptian exports to COMESA countries accounted for about 8% of its total exports in 2014. Although the percentage is not large, it is expected to increase in the upcoming years, especially as COMESA markets absorb significant proportions of Egyptian exports. For instance, COMESA markets receive about 25% of Egypt’s exports of ceramic products, 10% of plastic products, 35% of sugar production, 20% of fruit and vegetable exports, 25% of cement and paper exports, 18% of dairy exports, and 15% of medicine and glass exports. Various engineering products have an export percentage that ranges from 8% to 25%. These are impressive proportions that must be preserved and increased.
Related: Egyptian banks unconcerned with Africa (Daily News), Egyptian tech companies to expand in Africa to develop governmental services (Daily News)
UK seeks to revive Kenya exports with Sh74bn kitty (Business Daily)
Britain has set up a Sh74 billion fund to provide credit lines to local firms that buy goods from the European state in a bid to revive its dwindling exports to Kenya. The UK’s Trade envoy to Kenya, Lord Clive Hollick - who is expected in the country on Wednesday for a three-day visit - is set to unveil the fund that also provides cover against risks incurred by British firms while exporting goods to Kenya. In recent years, the country has been losing out to China, India and Japan with official data showing the value of imports from the UK to Kenya dipping to Sh40.1 billion in the first 11 months of last year, compared to Sh41.3 billion a year earlier and Sh45.7 billion in 2013.
Nigeria: These charts show the decline of investor confidence in Africa’s largest economy (Quartz)
The Capital Importation report tracks the total inflow of capital into the country under three main investment types: Foreign direct investment , portfolio investment and other investments, including currency deposits and loans. In 2015, total capital imported into Nigeria stood at $9.6bn, the lowest recorded total since 2011. It represents a 53% drop from the $20.7bn recorded in 2014.
Committee on Technical Barriers to Trade: 2015 annual review (WTO)
The WTO Committee on Technical Barriers to Trade (the Committee) will conduct its Twenty-First Annual Review of the Implementation and Operation of the WTO Agreement on Technical Barriers to Trade (the TBT Agreement) under Article 15.3 at its next meeting on 9-10 March 2016. This document contains information on developments in the Committee relating to the implementation and operation of the TBT Agreement from 1 January to 31 December 2015.
Extract: In terms of the Committee's review of measures, during the year, notifications decreased by 12% compared to the previous year (to a total of 1,989 notifications). Nevertheless, the trend since 2015 has been an upward one driven increasingly by developing Members. In 2015, developing Members continued to submit significantly more new notifications than developed Members - also the number of notifications from LDCs increased during the year. In total, 86 specific trade concerns were discussed in 2015, the second highest number since 1995. [Download]
German development cooperation with SADC: newsletter
Highlight: 13 April, Johannesburg - launch of Southern African Business Forum Working Groups to improve cooperation between private sector and SADC to accelerate Regional Economic Integration around selected topics and barriers to trade. Johannesburg
Five proposals for SADC health innovations (SAIIA)
Social cohesion in Eastern Africa (UNECA)
The report examines social cohesion using data from a wide variety of sources, including national statistics institutes and international organisations. But it also investigates qualitative data, including opinion surveys and questionnaires to gain a deeper appreciation of the perspectives of citizens in the region. This results in some surprising findings.
Extract: This final point merits some further discussion. Regional solutions to the problems associated with a lack of social cohesion will be constrained by the availability of resources at the regional level. Presently, for instance, the annual budget of the EAC Secretariat, at around $140 million, is miniscule compared to the scale of challenges and the size of the regional economy (approximately $134 billion in 2014). Thus far, despite all the good work, it is probably fair to say that regional organizations such as the EAC do not impact directly enough on the lives of their citizens. At least, that seems to be people’s perceptions at present. A recent opinion poll carried out by Afrobarometer (2015) revealed that less than one in five of the citizens in Burundi, Kenya or the United Republic of Tanzania enthusiastically felt that the regional body was having a positive impact on their lives. [Download]
Financing mechanism top agenda of next EAC summit (New Times)
“Top on the agenda is the consideration of reports by the EAC Council of Ministers on: the negotiations on the admission of the Republic of South Sudan into the Community; sustainable financing mechanisms for the EAC; and the EAC Institutional Review,” reads an EAC statement. For the past few years, EAC leaders have been mulling how to find the best sustainable financing mechanisms for bloc’s activities. A directive by the Summit in November 2013 tasked the Council, the bloc’s policy organ, to present a report on alternative financing mechanisms, including the option of one per cent of imports from outside EAC, as one of the ways the bloc could reduce overreliance on donor aid. “The ministers for finance are going to meet early next week and they will advise accordingly on what would be a final solution,” said Innocent Safari, the permanent secretary at the Ministry of East African Community Affairs.
Demand for iron ore levelled off in 2015 (UNCTAD)
The UNCTAD Iron Ore Market Report 2015, covering developments in the iron ore market in 2014 and providing an overview for 2015–2016, shows that slowing growth in worldwide steel production meant that the market for iron ore, the primary raw material of steel, entered a new phase with slower growth, lower prices and squeezed margins for mining companies. The report notes that world crude steel production in 2015 reached an estimated 1,763 million tonnes, a decrease of 2.9%, while the iron ore production reached 1,948 million tonnes, down 6% on 2014. The effect on the iron ore market was that, after a long period of rapid growth, demand levelled off and prices returned to levels not seen since 2002. The price of iron ore began 2015 at $71.26 per dry metric tonne but fell 39% by the end of the year. A reorientation of China’s economic strategy brought growth in the use of steel almost to a halt, and signs of demand picking up in other parts of the world were not enough to offset China's slowdown.
The change in demand for debt: the new landscape in low-income countries (IMF)
Sovereign bonds issued by low-income countries amounted to $4bn in 2013 and to $8bn in 2014, thanks in part to issuances by Côte d’Ivoire, Ethiopia, Ghana, Kenya, Senegal, Vietnam, and Zambia. In 2015, with weaker global conditions and falling commodity prices, the number of issuances declined and those who issued new bonds had to pay significantly higher yields.
Ghana: National commodity exchange will be a game-changer (Asoko Insight)
US-ASEAN: Sunnylands Declaration (White House)
Narendra Modi’s Rs8 trillion Make-in-India haul masks challenges to come (Livemint)
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