News
tralac’s Daily News Selection
The selection: Monday, 23 May 2016
For publication this Wednesday, Africa Day: a new Afrobarometer report on views towards regional integration. ‘Do Africans want it? What does it mean for them?’
Published today: African Economic Outlook 2016
With two-thirds of Africans expected to live in cities by 2050, how Africa urbanises will be critical to the continent's future growth and development, according to the African Economic Outlook 2016 released today at the African Development Bank Group's 51st Annual Meetings. In 2015, approximately 879 million Africans lived in countries with low human development, while 295 million lived in medium and high human development countries. Africa's youth are particularly at risk from slow human progress. In sub-Saharan Africa nine out of ten working youth are poor or near poor. "In 2016, the emerging common African position on urban development and the international New Urban Agenda to be discussed in Quito in October provide the opportunity to begin moulding ambitious urbanisation policies into concrete strategies for Africa's structural transformation," said Abdoulaye Mar Dieye, the Director of the Regional Bureau for Africa at the United Nations Development Programme. "We need to invest in building economic opportunities, especially those of women of which 92% work in the informal sector. Cities and towns have a key role to play in that process, but only if governments take bold policy action."
AEO’s Chapter 3: Trade policies and regional integration in Africa – ‘Convergence indicators across Africa show mixed patterns’
In the five-nation Southern African Customs Union, incomes have converged by 13.3%. While countries are globally falling behind Botswana, the richest economy in the group, Namibia is slowly reducing its gap with South Africa, the second richest. Still in Southern Africa, SADC countries show a slightly lower convergence rate, estimated at 11.2%. In COMESA, which includes countries in East and Southern Africa, the convergence rate is estimated at 14.8%. Policy makers need to quickly address three key issues to bolster income convergence in Africa’s regional communities: [Country profiles, interactive data]
Related, from AfDB: IDEV 2015 Annual Report, Strategy for Jobs for Youth in Africa 2016-2025, New Deal on Energy for Africa
Should Mozambique join the Tripartite Free Trade Area? (SPEED)
Mozambique is one of the smaller states that voiced concerns over the impact the agreement would have on their economies, and therefore requires more time to assess these effects. The study below was developed to support the decision-making process in Mozambique. The study explores the genesis of the TFTA and progress made to date. The ideals of the TFTA are viewed from the perspective of Mozambique’s long term goals is presented mainly by the strategic plan for development of the agricultural sector and the industrial development plan. The benefits likely to accrue from the TFTA are consequently evaluated with a view to determining if they would positively apply in the case of Mozambique. The study then looks at the circumstances in which the benefits can be realized and Mozambique can ensure that such circumstances exist. [The analyst: Isaac Ndung’u]
Movement of services providers in the EAC: review of what is happening and lessons for the TFTA and CFTA (tralac)
Generally, the challenges spring not only from linkages but also the provisions of the Protocol. The question is whether the schedules deliver the objective of wider and deeper market integration. The solution to these challenges, to a large extent, requires amendments to both the Protocol and the member states’ schedules. Therefore, in September 2014, the Council of Ministers directed member states to submit proposals to address the discrepancies in the CMP on movement of services. Although the progress has been slow, member states since agreed to renegotiate the movement of services. The issues being renegotiated include an article on market access and Mode 4 categories, revised schedules of commitments and implementation regulations. This offers a lesson for the COMESA-EAC-SADC Tripartite and the CFTA negotiations to ensure that enough time and effort is invested in the drafting of the agreement, to avoid renegotiation as is the case in the EAC. [The analyst: Viola Sawere]
Ending the tyranny of primary commodity booms: lessons for Africa (New Times)
Let’s look at the facts: the above-cited UNDP Africa report on commodity booms and busts shows that close to over 30 years after independence in the late 1990s, two primary commodities accounted for more than half of export earnings of 39 out of 47 African countries. Further down the road in 2014, the export diversification index for Sub-Saharan African countries (which measures success in reducing over dependence on primary commodities) increased only marginally from its level in 1995 while the export concentration index (which measures the extent primary commodities dominate the total exports from the countries) actually doubled on average. The extent of the slow progress towards meaningful reduction on primary commodities by SSA countries is further illustrated by the following words: "Every African country, except South Africa, has a higher export concentration index than the average for developing countries, and 19 of the 49 African economies with data have an export concentration index that exceeds the average for developing countries (excluding China) by 30 percentage points."
It seems that during the boom periods, most African governments become oblivious to the adverse implications of over dependence on primary commodities for the sustainability of their growth rates, industrialization efforts, adequate employment creation and fiscal revenues. Importantly also, promotion of development regionalism that could allow primary commodity dependent countries to take advantage of economies of scale of value chains that are beyond the capacity of individual countries potentially constitutes a powerful instrument for overcoming the tyranny of commodity booms and busts. [The author, Lamin M. Manneh, is the One UN Rwanda Resident Coordinator]
Anzetse Were: 'How commodities decline is good for Africa’s economy' (Business Daily)
There’s hope for Botswana manufacturers - EU (The Voice)
Tanzania: SAGCOT partners eye $3.5bn investments come 2030 (IPPMedia), Tanga EPZ project taking shape (IPPMedia)
Absence of leather factories denies Rwanda millions in exports (The East African)
Rwanda mining sector to diversify as global prices of tin, coltan fall (The East African)
François Bourguignon: 'Global deindustrialization threatens the development of poor countries' (Huffington Post)
GE's Immelt signals end to 7 decades of globalization (Fortune)
Mega-regional agreements and global trade governance: ensuring openness and inclusiveness in an increasingly complex system (Bridges Africa, ICTSD)
Policymakers engaging in the next phase of international trade talks should heed this warning. If mega-regionals’ risks for third countries are not addressed in time, perceptions of competing bilateralism could spread further and the creation of rivalling trade blocs accelerates, Baldwin’s “tipping point” will be looming rather sooner than later. At present, the WTO and individual members certainly cannot stop the frontrunners that strive for deeper integration with selected trade partners. However, what we need to do in a multi-speed system is to bridge and enlarge the clusters of deep integration with the slower-moving members. Most importantly, this involves minimising the risks for developing countries ensuing from mega-regional agreements. [The analyst: Fabian Bohnenberger] [Will the TPP and OBOR challenge ASEAN centrality? (East Asia Forum)]
Trade and current account balances in Sub-Saharan Africa: stylized facts and implications for poverty (UNCTAD)
This paper examines the main components of Sub-Saharan Africa’s balance of payments – current account and capital and financial accounts – with a view to answering the following questions: (a) what role has trade played in observed current account deficits in SSA?; (b) How has the current account been financed and what are the implications?; and (c) what can African governments do to reverse recent trends in the current account and use trade, more effectively than in the past, in support of poverty reduction efforts on the continent?
DRC's Grand Inga plan faces watershed (Business Day)
South Africa might escape its hasty and costly decision to lead the financial package needed to kick-start the stalled Inga 3 Hydroelectric scheme in the Democratic Republic of the Congo. The project, on the Congo River, is a proposed component of the five-dam Grand Inga hydro colossus, and it might never happen. A treaty signed between the DRC’s President Joseph Kabila and his counterpart Jacob Zuma in 2013 commits SA to buying 2,500MW of the scheme’s 4,800MW output. In other words, the treaty is a power-purchase agreement that binds SA to a huge financial liability to help the dam to be built. Assuming 90% availability, SA’s uptake with normal maintenance and no droughts would be worth about $500m-$600m a year.
As a region we should all be celebrating the 'new' Tanzania (New Times)
Ironically, the same people who are always complaining that Tanzania is slow are the ones now expressing worry over developments in Tanzania. I often prefer to be optimistic. With a pipeline from Uganda to Tanga in Tanzania and a Standard Gauge Railway connecting Rwanda, Burundi and DRC, Tanzania will certainly have more reason to dedicate more time and resources to the EAC project as opposed to focusing on the Southern African Development Community. This is not the time for sibling rivalry but a time for all of us to fold our sleeves and get to work. As an East African I am very sure that a better Tanzania is good news for every other East African. So Kenyans should stop whining and get back to making East African great again, if I can borrow a phrase from an infamous person right now. [The author: Allan Brian Ssenyonga] [Rwanda's exit casts doubts on viability of SGR]
Inter-Burundi Dialogue: statement
SADC discusses inequality in mineworkers compensation (SABC)
The [SA] Department of Mineral Resources estimates that at least R30bn unclaimed benefits are due to mineworkers in the SADC region. Ministers from South Africa and SADC countries concluded a two day compensation summit in Sandton, north of Johannesburg. The majority of migrant mine workers come from Lesotho. Minister of Labour in that country, Thulo Mahlakeng, says the number of their country's nationals waiting for compensation is increasing.
Decarbonising transport: ITF launches major new project (ITF)
This ambitious initiative, anchored in the ITF’s Corporate Partnership Board, will bring together ITF’s modelling capabilities with those of outside partners, to provide worldwide, data-driven modelling of policy outcomes. The modelling results will in turn feed dialogue, collaboration and mutual learning among all stakeholders to establish a commonly acceptable roadmap to zero-carbon transport. There will be different paths and schedules across transport modes and regions of the world, but driven by a common ambition of reaching carbon-neutral mobility within the next 35 to 50 years.
Ghana to save $200m yearly with single window system at ports (GBN)
East Africa: $16m earmarked for reducing regional transport costs
World Humanitarian Summit highlights: Common African Position, Statement by Multilateral Development Banks, Humanitarian aid rises to record $28bn in 2015 (The Wire), Statement by Joan Clos, Stephen O’Brien, Across Africa, the worst famine since 1985 looms for 50 million (The Guardian)
tralac’s Daily News archive
Catch up on tralac’s daily news selections by following this link ».
SUBSCRIBE
To receive the link to tralac’s Daily News Selection via email, click here to subscribe.
This post has been sourced on behalf of tralac and disseminated to enhance trade policy knowledge and debate. It is distributed to over 350 recipients across Africa and internationally, serving in the AU, RECS, national government trade departments and research and development agencies. Your feedback is most welcome. Any suggestions that our recipients might have of items for inclusion are most welcome.
