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tralac’s Daily News Selection
The selection: Thursday, 31 March 2016
Starting today, in Addis: the 2016 Conference of Ministers on the theme: ‘Towards an integrated and coherent approach to implementation, monitoring and evaluation of Agenda 2063 and the SDGs’.
Today, in Kigali: the MINEAC hosts an engagement with Rwandan civil society on EAC integration. Updates: @MINEACRwanda
South Africa: February trade statistics (SARS)
The South African Revenue Service today releases trade statistics for February 2016 that recorded a trade deficit of R1.07 billion. This figure includes trade data with Botswana, Lesotho, Namibia and Swaziland. The February deficit is due to exports of R90.68bn and imports of R91.75bn, improving from a revised deficit of R17.96bn in January 2016. Exports increased from January 2016 to February 2016 by R19.29bn (27.0%) and imports increased from January 2016 to February 2016 by R2.39bn (2.7%).
Kenya Economic Update: Kazi ni Kazi – informal should not be normal (World Bank)
Extract: Trade performance and export growth for employment creation (Chapter 3): The declining performance of Kenya’s merchandise exports is not new, yet reversing it is key to robust growth and employment creation. Overall exports growth averaged 3% for the period 2010-2015, which was below average economic growth of 6% during the same period. More importantly, export growth to Kenya’s largest markets, EU, EAC and COMESA, was only 1-2%. At the same time, exports to Asia, Australia and the America’s recorded remarkable growth at about 10%. Notably, exports to Asia and Australia account for similar share with EU, accounting for 22% of total exports. But by far the most significant growth on exports recorded was to the Americas, at rates above 10%.
Exports to EAC region started declining in 2011. This coincided with the entry of the fully-fledged Customs Union. The customs union abolished preference access of Kenya’s manufactured products from Export Promotion Schemes. These products started to attract full Common External Tariff instead of being traded on duty free basis. Box 2.1 shows the export products that have declined in the EAC market. These products are from the manufacturing sector. Notably, Tanzania and Uganda now source these products from other markets outside the region (trade diversion). This market loss, which in real sense means loss of trade related jobs in Kenya, needs to be accompanied by a reallocation of factors to sectors that can compete in a deepened regional trade.
Africa told to step up checks on cheap Chinese imports (New Vision)
Officials from the Chinese government announced new plans on Tuesday to tighten controls intended to curb the practice but asked African states to follow suit. Yang Peipei, the councillor at China’s ministry of commerce, told journalists in China’s capital, Beijing on Tuesday that the practice has is driven by traders from Africa. “We are aware of the problem of substandard items exported to Africa. But this is largely because most African countries are price-sensitive and force manufacturers to cut costs in order to lower prices,” Peipei said during a press briefing on China-Africa economic cooperation and investment. To cash in on the lucrative business, traders approach manufacturers in China and ask for goods of lower quality at lower prices. Some of the items cost a fraction of the original brands. In most cases, however, buyers are unable to differentiate between genuine products and knock-offs.
CSR practices of Chinese businesses in the global South: findings from Kenya, Mozambique and Uganda (IIED)
Africa Incentive Survey 2016 (KPMG)
The purpose of the survey is to understand the landscape of incentives offered by African countries, both to local and foreign investors. Whilst in an ideal world, information relating to all countries in Africa would have been included in such a survey, for a variety of reasons (including time limitations), this survey contains information across 28 countries in Africa that represent 81% of Africa’s USD 2.4 trillion GDP and which are home to three-quarters of Africa’s 1.2 billion population. More than a third of the 28 countries surveyed have incentives related to manufacturing. It appears that African countries are reforming the incentive policies to include manufacturing incentives, to attract manufacturing FDI within their countries. South Africa, Nigeria and Morocco are notably the only countries in Africa that offer cash grants in addition to tax incentives, all of which require prior approval by government. [Download ppt presentation]
New data on East African private equity activity (RisCura)
Put together by global professional investment services firm RisCura on behalf of the East African Venture Capital Association the dashboard shows that Kenya is dominating the region as a hub of private equity activity. The RisCura-EAVCA East Africa Private Equity Deal Dashboard surveyed 16 funds, of which 13 are EAVCA members, and 63 transactions, which Rory Ord, Executive at RisCura says provides a fair sample. Of those, the value of deals in 2015 was $152m, up substantially from the 2014 value of $52m.
The role of agropoles and agro-processing zones in Africa’s agricultural transformation (AfDB)
Also speaking on the occasion, the Agriculture and Agro-industry Department Director, Chiji Ojukwu, revealed that the continent faces a staggering food import bill of US $35.4 billion per annum which is projected to increase to US $110 billion by 2025. “Can Africa continue to afford importing food at this level and magnitude?” he asked. The two-day extensive meeting closed with the following key recommendations for the Bank Group: i) Support the establishment of a network of Agropoles and Agroprocessing Zones in Africa to promote the implementation of a continent-wide agropoles strategy; ii) Facilitate investments in agropoles in countries facing situations of fragility; iii) Develop generic strategic and planning guidelines for the creation of agropoles and agroprocessing zones for African countries and provide technical assistance to them; iv) Integrate the development of agropoles in other initiatives supported by the AfDB such as agricultural value chains, youth employment, commodity exchanges and other investments in the agriculture sector.
Congo: Support to the transport sector and related agricultural and rural infrastructure (AfDB)
The upgrading and paving of the Mila Mila-Makabana-Mossendjo road is an alternative to the Brazzaville-Libreville road link as it enables direct travel from Brazzaville and Pointe-Noire to Franceville in Gabon, with the possibility of a road/rail intermodality to Franceville and significant time gain. It is against this background that the economic importance of Niari Department (Département du Niari), hitherto the country’s bread basket, has declined over the years owing to constantly deteriorating transport and marketing infrastructure.
Transportation costs and efficiency in West and Central Africa (tralac)
Thus the Regional Sealink Consortium announced at the [Abuja] workshop that they are collaborating in an effort to establish a shipping line for trading within west and central African. This will be a multi-modal transport system to include an integrated maritime and logistics services-combined transport and warehousing facility with supporting ancillary services like container handling, weighing activities and inland waterways. There are some essential elements which should be evaluated and included in the development of the multi-modal transportation system to be effective and improve competitiveness. These are vital to ensure goods are able to move from one point to another rapidly, reliably and cheaply: [The author: Willemien Viljoen]
Kazungula Bridge project: update (Government of Botswana)
According to a report presented by the two Permanent Secretaries, construction of a temporary bridge on the Zambian side has been completed while on the Botswana side it is expected to be completed in June 2016. Construction of the permanent bridge on the Zambian side has also commenced. The Bridge is of strategic importance to the economic integration of, not only Botswana and Zambia, but the SADC Region as a whole. The Bridge will provide the much-needed connection between the regional economic areas, and will also link regional ports which handle all
Global Infrastructure Forum preview: the importance of investing in built-to-last infrastructure (Brookings)
Are less developed countries more exposed to multinational tax avoidance? (UNU-WIDER)
We use a global dataset with information on 210,000 corporations in 102 countries to investigate whether cross-border profit shifting by multinational firms is more prevalent in less developed countries. We propose a novel technique to study aggressive profit shifting and improve the credibility of existing techniques. Our results consistently show that the sensitivity of reported profits to profit-shifting incentives is negatively related to the level of economic and institutional development. This may explain why many developing countries opt for low corporate tax rates in spite of urgent revenue needs and severe constraints on the use of other tax bases.
ECOSOC special meeting on inequality (UN)
Inequality is a universal challenge faced by least-developed, middle-income and developed countries alike, but which can be overcome by political will at national and international levels, the United Nations deputy chief said today. Addressing a special meeting on inequality convened by the UN Economic and Social Council, Deputy Secretary-General Jan Eliasson said that inequalities within and among countries pose an immense challenge to global development efforts. [DRC: UNSC debate, resolution on extension of MONUSCO's mandate (UN)]
UNODC launches initial study on Afghan opiate trade in Africa
Released earlier this month by UNODC, the 'Afghan opiate trade and Africa - a baseline assessment 2016' sheds new light on the illicit Afghan opiate trafficking situation in Africa. The report offers a much needed evidence base to support policymakers and law enforcement officials in understanding the trafficking of Afghan opiates into and across Africa in order to help in the development of an effective and coordinated response. 11 per cent of the world's opiate users are estimated to be based in Africa, with more than 50 per cent of these found in West and Central Africa.
Are India-US trade relations again on a downward spiral? (Livemint)
US President Barack Obama and Prime Minister Narendra Modi will meet on Thursday on the sidelines of the Nuclear Security Summit in Washington. They will for sure exchange pleasantries and even the latter’s trademark bear hug but there is no doubt that the two nations are now increasingly engaged in what even government officials in New Delhi have started to acknowledge is a “trade war”. Here are a few examples:
WTO members “still interested” in securing results in rules negotiations (WT0)
Ghana’s visa relaxation a vote of faith in Africa (Business Day)
Republic of Congo formalises Afreximbank membership (StarAfrica)
Lagos State launches one-stop shop for investors (CNBC Africa)
Magufuli's government hit by more foreign aid cuts (IPPMedia)
Total sticks to Tanga pipeline route as Kenya seeks consensus (IPPMedia)
Chinese investors eye Tanzania’s energy sector (Daily News)
Global steel industry facing ‘Ice Age,’ top China mill warns (Bloomberg)
Morocco to get Africa's first automated container terminal (Maritime Executive)
Mystery firm promotes Moz-Malawi-Zambia-Congo fuel pipeline (Zitamar)
KRA set to miss Treasury’s Sh1.2trn tax collection target (Business Daily)
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