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tralac’s Daily News Selection
The selection: Friday, 6 May 2016
Featured tweet: @UNCTADinAfrica: A call for a meticulous yet open minded approach 2 a pan African CFTA by Commissioner Acyl & @Erastus_Mwencha closing drafting session
Three EPA updates: @Trade_Kenya: 'It is critical to sign EPA by all EAC & EU partner states in June to allow ample time for ratification process', Kenyan horticulture set to benefit as MPs line up EPA deal, Agbiz briefing: SACU EPA tariff rate quota developments
Poverty and shared prosperity implications of deep integration in Eastern and Southern Africa (World Bank)
Evidence indicates that trade costs are a much more substantial barrier to trade than tariffs are, especially in Sub-Saharan Africa. This paper decomposes trade costs into: (i) trade facilitation, (ii) non-tariff barriers, and (iii) the costs of business services. The paper assesses the poverty and shared prosperity impacts of deep integration to reduce these three types of trade costs in: (i) the EAC-COMESA-SADC "Tripartite" Free Trade Area; (ii) within the EA Customs Union; and (iii) unilaterally by the EA Customs Union. The paper finds that these reforms are pro-poor. There are significant reductions in the poverty headcount and the percentage of the population living in poverty for all six of the African regions from deep integration in the Tripartite Free Trade Area or comparable unilateral reforms by the EA Customs Union. Further, the incomes of the bottom 40% of the populations noticeably increase in all countries or regions that are engaged in the trade reforms. [The authors: Edward Jay Balistreri, Maryla Maliszewska, Israel Osorio-Rodarte, David Tarr, Hidemichi Yonezawa]
ASDI launch: Africa poorer than two decades ago (UNECA)
While trends in the rest of the world show an improvement in poverty levels compared to 20 years ago, Africa is getting poorer. This is according to the African Social Development Index – ASDI whose findings reveal that poverty, fueled by inequality, remains the single most driver of human exclusion in Africa. Women, youth and rural communities bare the most of human exclusion. Speaking at the launch of the sub-regional report for Southern Africa, in Johannesburg South Africa, Takyiwaa Manuh, ECA Director for Social Development Policy Division said that the ASDI was a collaborative effort between ECA and member States to help monitor and track human development. The southern Africa ASDI report comprises of eight countries including Angola, Botswana, Malawi, Mauritius, Namibia, Swaziland, Zimbabwe and Zambia. There are variations between and within countries. The human exclusion in Botswana is higher in rural areas, than cities with infant mortality and youth unemployment as major drivers. Zambia and Malawi showed higher exclusion in cities than in rural areas with poverty and youth unemployment as major drivers.
SADC financial inclusion strategy workshop report (FinMark Trust)
A draft strategy was developed by FinMark Trust and presented to SADC stakeholders on 11th and 12th February 2016 at Centurion Lake Hotel in Pretoria. At the workshop, inputs were obtained from stakeholders before finalisation of the strategy for submission to the Ministers of Finance for consideration. The report highlights the key messages from the two-day workshop. [Building African financial markets via regional economic diversification (Business World)]
Nigeria: Understanding the relationship between growth and employment (Brookings)
The challenges for the new administration include the diversification of the economy, blockage of fiscal leakages, prioritization of government expenditures to boost investment in critical infrastructure, and job creation. While intuition suggests that employment growth and poverty reduction are closely linked, there has been little research in this area in Nigeria apart from Treichel (2010). This paper therefore tries to fill this gap by studying the experience of Nigeria, where average annual economic growth has reached 6.8% in the last decade, but unemployment has been rising persistently. In line with the orientation of the project, the Nigerian case study intends to deepen our understanding of the character of Nigeria’s non-inclusive growth experience and identify the potential limits and constraints to inclusive growth experience and the likely domestic and external economic growth opportunities available for Nigeria in the medium- to long-term, and explore how these can be exploited. [The authors: Olu Ajakaiye, Afeikhena T. Jerome, David Nabena, Olufunke A. Alaba]
South Sudan joins COMESA regional customs scheme (COMESA)
South Sudan has joined the COMESA Regional Customs Transit Guarantee (RCTG) Scheme after signing the instruments of accession on 4 May 2016. The signing ceremony took place during the 9th Meeting of the Management of the RCTG Scheme which was opened by COMESA Secretary General Sindiso Ngwenya in Mombasa. This bring to two the number of COMESA instruments that South Sudan is implementing including the third Party Insurance Scheme known as the COMESA Yellow Card. Two other countries namely, Burundi and DRC are expected to commence operations of the RCTG in May and June this year respectively. Despite the encouraging progress in the Northern, Central and Dar Corridor countries, the Secretary General said challenges in its implementation were being experienced in the Djibouti Corridor and the North-South Corridor. In the North-South Corridor, Zambia is in the process of engaging its stakeholders to join the scheme. This will enable other member States in the Corridor, namely, Zimbabwe and Malawi to move forward in the implementation process of the scheme. [Insurers, transporters renew efforts to boost COMESA yellow card usage]
Edith N Mwanje: 'New EAC e-passport consolidates integration' (Daily Monitor)
Owing to these security features, the new passport will make it easier to negotiate visa-free access to other countries. The common passport also reaffirms the right of EAC citizens to live and work in each other’s countries. A roadmap has been agreed upon at the regional level. The Ministry of Internal Affairs (Directorate of Citizenship and Immigration Control) will roll out a programme for issuance of the new passport and for the recall of the national passport. The process will be replicated across all the partner states until December 2018 when all national passports of individual partner states are expected to be phased out. [The author is the Permanent Secretary, Ministry of EAC Affairs, Uganda]
Kenya hopes for business boom in new South Africa visa rule (The Star)
The new visa regime will rekindle growth of trade flows between the two countries, which suffered a blow after South Africa introduced stringent travel measures in 2014, KNCCI chairman Kiprono Kittony said. The value of South Africa's imports to Kenya in 2015 dropped to Sh61.31bn last year from Sh63.89bn in 2014, according to the Kenya Economic Survey 2016. Kenya's exports to South Africa also declined to Sh4.33bn from Sh5.9bn in 2014. “These are some of the effects of the strict movement that was there in the last two years,” Kitonny said. He said he will be leading a business delegation to South Africa in July, in line with its MoU with the South Africa Chamber of Commerce and Industry, to push for more trade deals.
Afreximbank's intra-African trade finance and payment systems conference: outcomes
African development finance institutions must come together in partnership in order to more effectively tackle the challenges affecting the financing of intra-African trade, participants at the first ever continental conference on intra-African trade finance and payment systems have urged. Recognising the challenge posed by settlements in the financing of trade among African countries, they recommended that Afreximbank should create a clearing house through which payments for intra-African trade would be carried out. According to them, the use of such a continent-wide clearing house would lead to significant reduction in the foreign exchange cost of such trade.
Trade between China and Portuguese-speaking countries falls 23% in 1st quarter (MacauHub)
Trade between China and Portuguese-speaking countries contracted by 23.03% year-on-year during the first quarter to $16.727bn, according to official figures published in Macau. Over the first three months of the year China exported to the eight Portuguese-speaking countries goods worth $5.844bn (-44.95%) and imported goods amounting to $10.882bn (-2.1%), assuming a deficit of $5.038bn. Chinese sales to Angola in the first quarter registered a decline of 75.36% to $345m and purchases of Angolan goods fell 27.58%. China’s trade with Mozambique amounted to $404m (-31.15%), with China exporting goods worth $275m (-38.38%) and importing goods amounting to $129m (-8.17%).
Chinese imports from Africa: the impact of the recent commodity price declines (tralac)
The objective for this paper is to examine Chinese imports from Africa during 2015 and assess the extent to which falling global commodity prices have contributed to changes over more recent import values, and in particular from the 2014 values. The profile of Chinese imports from Africa by value shows that they were very consistent over the three years from 2012 to 2014 inclusive at around $115bn, but during 2015 they declined by 39% in aggregate to $70.5bn. This decline was significantly greater than the 14% decline in Chinese global imports, and meant that the African share of the Chinese global imports declined from being consistently close to 6% over the previous three years to 4.19% during 2015. [The authors: Ron Sandrey, Emmanuel Igbinoba, Rodney Hoaeb, Tebogo Mojafi]
Related: Tony Addison: Sub-Saharan Africa's trade balance with China, 2005-15, ChinaAfricaBlog: Ethiopia, Kenya, Republic of Congo and Tanzania to demonstrate China-Africa industrial cooperation
New tralac papers: UNECA launches Transformative Industrial Policy for Africa (Brian Mureverwi), Analysing South Africa’s 2011-15 depreciation (John Stuart)
Africa follows UAE in taking the free zone route (The National)
Special economic zones are back in fashion across Africa as countries scramble to replace revenue lost from falling commodity sales. Instrumental in SEZs opening up across Africa is the influence of China, where such zones have underpinned the country’s spectacular growth over the past two decades. Of Africa’s 54 countries, most have SEZs or are planning them. However SEZs are not a guarantee of success, especially as competition between them increases.
FAO Food Price Index: April figures (UN)
Global prices of key staple food commodities rose in April, marking a third consecutive monthly increase after four years of decline, the FAO said today. The FAO Food Price Index averaged 151.8 points in April, a 0.7% increase from March. That is about 10% below its level of a year ago and more than a third off its 2011 highs. The gradual increase is far from even across the board. [Regional grain supplies, with specific focus on South Africa: Agbiz presentation to USDA food security seminar, Kenya: Surge in food prices hits the poor as cheap oil boosts the rich]
Non-tariff measures and the world trading system (World Bank)
This paper considers the recent empirical and theoretical literature on non-tariff measures in the world trading system. It provides a set of stylized facts based on available data on non-tariff measures and reviews the key methods used to estimate their trade impact.
Economics of currencies: Why the Rand still matters (Zimbabwe Independent)
Zimbabwe: 81 companies close down in 2016 first quarter (Zimbabwe Independent)
Tanzania plans gas pipeline to Uganda (The East African)
AfDB to unveil strategies for Africa’s transformation at 2016 Annual Meetings in Lusaka (AfDB)
Africa needs capacity to forge its own progress: ACBF conference (Anadolu Agency)
Africa should speed formation of Pan-African IP body, UN report says (IP Watch)
85 think tanks build bridges in support to African development (UNECA)
At climate summit in Washington, UN officials call to take action ‘to the next level’ (UN)
World Summit on the Information Society Forum 2016: harnessing the power of new technologies to drive global development (ITU)
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