News
tralac’s Daily News Selection
The selection: Friday, 17 June 2016
Concluding today, in Nairobi: World Bank’s East Africa transport corridors and impact evaluation workshop
Ahead of this weekend’s SACU Ministerial, next month’s SACU Retreat: a Gerhard Erasmus commentary ‘Does SACU face a crisis?’, and a matching tralac Backgrounder [tralac resources page: SACU legal texts and policy documents]
Featured tweets: @ICCBelgium: @wto and @OECD working together on an index for trade facilitation announces @WTODGAZEVEDO to @iccwbo world council; @McKinsey_MGI: In the G20, only Canada, Turkey, and South Africa increased investment in infrastructure
SADC Regional Vulnerability Assessment and Analysis update: 41m persons (23%) of the region’s 181 million rural population are food insecure
ACP-EU Assembly closes in Windhoek: resolutions
In a debate on Wednesday, Members called for a renewed post-Cotonou architecture to adapt the ACP-EU partnership to new global challenges. Co-President ad interim Michèle Rivasi (Greens/EFA, FR) stressed the need to strengthen the parliamentary dimension and include civil society in the new form of cooperation. MEPs and their ACP counterparts were also joined by Mozambique’s former President Joaquim Chissano to debate the changing face of conflict and global security threats and their impact on global peace and stability. MEPs and MPs also discussed the prevention and management of epidemics in a post-Ebola context and the Zika virus threat. Three reports and two urgent resolutions were approved at the Wednesday afternoon voting session. They concern:
Related: 2016 European Development Days: President Kenyatta's keynote address, Third Annual Bank Conference on Africa: closing speech by Albert Zeufack, Chief Economist for Africa Region
Dar and Nairobi nod to key EAC Trade Bill (The Citizen)
In an apparent political will to spur intraregional trade, Tanzania and Kenya have assented to the East African Community Non-Tariff Barriers to Trade Bill, 2015. Tabling the EAC Budget, the Tanzania's deputy minister for Foreign Affairs, East Africa, and Regional and international Co-operation, Dr Susan Kolimba, said Dar and Nairobi had assented to the Bill and that the duo was waiting for other three heads of state to also append their signatures to it.
Tanzania’s Development Plan 2016/17-2021/22: resources, commentary
This [ODI] study informed the preparation of FYDP II. It takes stock of Tanzania’s industrialisation and economic transformation record, policies and strategies, identifies activities for nurturing a semi-industrialised economy, introduces a range of measurable targets that could be considered for the next FYDP, presents a resource mobilisation framework and considers new ways to make industrialisation and economic transformation a reality. The summary paper argues that Tanzania needs a radically different approach in the coming five years in order to seize the opportunities for industrialisation in a rapidly evolving environment and concludes that there are some early signs of structural transformation in Tanzania. [Download, pdf: Development Plan]
CTI survey: 'Over half of imported goods used in Tanzania are fake' (The Citizen)
At least 50% of goods consumed in Tanzania including drugs, foods, construction materials and other working tools are counterfeit, according to findings of a research commissioned by Confederation of Tanzania Industries. Prof Honest Ngowi, of the Dar es Salaam-based Mzumbe University campus, said that the findings resulted from interviewing 250 consumers countrywide and 47 manufacturers and combine primary and secondary data. Acting CTI chairman, Mr Evasist Maembe, said they had commissioned such research because the problem of fake goods is alarming, especially imported items from China, Bangladesh, Vietnam, Singapore, Kenya, South Africa and others.
Tanzania: Border points cited as major tax evasion loopholes (IPPMedia)
Speaking to The Guardian in an exclusive interview this week, the commissioner general of the state-run Tanzania Revenue Authority, Alphayo Kidata, said the problem is mainly exacerbated by the country’s geographical location. "The (Tanzanian) border is very porous – it should be noted that to the east, there is the long stretch of the Indian Ocean, while in other directions we are surrounded by Kenya, Uganda, Burundi, Rwanda, DR Congo, Zambia, Malawi and Mozambique," Kidata noted. He cited Mara, Arusha, Kilimanjaro, Tanga, Kigoma, Katavi, Rukwa, Mbeya, Njombe, Ruvuma, Mtwara, Kagera, Mwanza, Kigoma, Tanga, Coast, Dar es Salaam, Lindi and Mtwara as the regions mainly accosted by smuggling operations into the country.
What future for the WTO?: recommendations from IPU conference (IPU)
A global meeting of MPs specializing in international trade has called for urgent action to implement multilateral agreements which benefit the developing world. More than 400 parliamentary delegates from around 60 countries attended the Parliamentary Conference on the WTO, co-chaired by the IP and the European Parliament. The event, held in Geneva on 13-14 June, covered a wide range of topics under the theme What Future for the WTO? The conference recommendations include finding new approaches in order to resolve outstanding issues in the Doha Round of reforms, which has a particular focus on improving the trading prospects of developing countries. [Downloads include outcome document, discussion documents]
An innovative CGE assessment of the impact of the TTIP, including multinationals and FDI (GTAP)
The Transatlantic Trade and Investment Partnership is the largest agreement that has ever been negotiated with objectives going beyond trade itself. The partners account for around 40% of world trade and about a third of its GDP. It, therefore, seems to have the potential to affect world relationships. In this paper we focus on the economic impact for outsiders. To that aim we use an innovative Computable General Equilibrium with 10 regions (US, UE28, other advanced economies, China, India, Japan, South East Asia, Latin America, Middle East and Sub-Saharan Africa). We analyze in detail the weight in world GDP and trade of the 10 regions, as well as their productive, export and import structures.
African growers threaten Dutch flower power (Reuters)
The Netherlands is fighting to retain its crown as the world's top auction house for flowers as growers in Africa and elsewhere increasingly sell directly to buyers. And for growers in Kenya or Ethiopia, for example, being among FloraHolland's 4,600 members helps maintain stable prices in the face of powerful buyers such as Europe's top supermarket chains. Some 50% of Kenya's flower exports are sold via FloraHolland, and 70-80% of Ethiopia's. But being members also means they must commit to sell all of their output via FloraHolland and that can be a handicap when trying to reach Chinese or Indian markets. Vos said FloraHolland plans to open logistics sites overseas, either near growers in Europe or Africa or near Asian buyers, to preserve the company's central role in a more devolved global flower trade.
Zimbabwe improves ease of doing business (The Herald)
Major milestones were recorded in the second 100-Day Rapid Results Initiative, both legislative and administratively, with all thematic committees reporting positive movement towards achieving a conducive doing business environment. Progress was recorded in all the thematic areas which included Starting a Business and Protecting Minority Investors, Construction Permits and Property Registration, Enforcing Contracts and Resolving Insolvency, Getting Credit and Paying Taxes and Trading Across Borders. This was revealed at the Ease of Doing Business workshop hosted jointly by the Office of the President and Cabinet and The Herald Business yesterday.
Zimbabwe: US$200m facility already wiped out (Zimbabwe Independent)
Desperate measures by the Reserve Bank of Zimbabwe to inject bond notes backed by a US$200 million African Export and Import Bank facility to ease the current liquidity constraints is proving to be an ill-advised decision as the cash situation has subsequently worsened. [ECGC geared to support exporters]
Angola: Institutional capacity building for private sector development project (pdf, AfDB)
The project’s goal is to contribute to private sector development and diversification of the economy. The project’s specific objectives are to: i) support enterprise competitiveness and entrepreneurship and ii) support the development of the cooperative movement.
Military escort for trucks on Beira road (The Herald)
Mozambique’s army will escort trucks travelling a 270-kilometre stretch of road that passes through territory held by militias aligned with the opposition Renamo party, an industry body said. While the military convoys offer protection, they also double travel time and increase costs for haulers, according to Castigo Nhamane, head of the Mozambican Federation of Road Transport, or Fematro. “A trip that lasted two days before now can last twice as long because the convoys leave during a certain period only,” Nhamane said. “We urge the political leadership to resolve this issue. Carriers are struggling to pay back bank credit contracted for business. We can’t pay the wages of our workers.”
Uganda defeats Kenya over sugar surplus row (Daily Monitor)
According to the chairman of Uganda Sugar Manufacturers Association, Mr Jim Mwine Kabeho, Uganda has been producing surplus sugar since 2013, and the findings by the Kenyan team are not a surprise. An investigation instituted by the Kenyan government concluded that Uganda has a surplus of 36,000 metric tonnes of sugar, bringing to an end claims that the country’s sugar sub sector is incapable of exporting to the region. “This surplus was established and confirmed by a verification mission on the Ugandan sugar sector undertaken by Kenyan Government,” a statement issued by the Ministry of Trade on Tuesday said.
Kenya's trade ministry drafts rules for commodities exchange (Daily Nation)
The Trade and Industry ministry has prepared draft laws for the establishment of a commodities exchange as it rushes to beat a December deadline agreed among East African countries. The draft laws include several amendments to the Capital Markets Authorities Act and a set of standards to guide the exchange. [Kenya turns down maize buy request from drought-hit Malawi (The East African)]
Rwanda: Letter of Intent, Memorandum of Economic Financial Policies (pdf, IMF)
Extract: Medium term policies to reduce external imbalances - these policies include... Import substitution efforts: These are based on choosing a few key sectors (cement, sugar, rice and clothing) where local production can displace current imports. Regarding sugar, the government is looking for a new investor to take charge of sugar production and is offering land for sugar cane plantations; in the case of rice, the government is expanding acreage by 8,000 hectares with the objective of making the country self-sufficient in rice by 2018; with regard to cement, plans are in place to raise the production of the national cement company six fold to 600,000 tonnes per year.
Export promotion efforts: These efforts are ongoing and supported by an export promotion fund. Targeted areas include processed food, and the development of textiles, garments and leather industry where an anchor firm has already started exporting. We envisage starting exports of flowers soon and will expand acreage to 85 hectares; and there are plans to export laptops assembled in Rwanda; With a view to increasing the value of existing exports, we expect the proportion of fully washed coffee which increased to 50% in 2015 from 21% in 2010 to rise gradually and reach about 80% over the next two years).
Egyptian parliament approves tariff increase on hundreds of imported goods (Ahram)
The Egyptian parliament approved Tuesday a presidential decree issued in late January that will raise customs tariffs imposed on more than 600 imported goods to between 20 and 40%, up from previous 10 and 30%, Al-Ahram daily reported Wednesday. The decree, No 25 of 2016-which includes imported goods such as household appliances, cosmetics, garments, footwear, nuts and pet foods-aims at protecting national industries and stopping the draining of foreign currency in Egypt.
African routes and right variables mix key for KQ survival (Business Daily)
For today, I want to focus on this third point by mapping it to Kenya Airways’ (KQ) now defunct Project Mawingu. There are a number of verticles that investors in the airline industry focus on. Of course profitability is paramount but in itself, it is a derivative of other variables. From a margins perspective, African routes seem to fare extremely well compared to Middle East, Asian and European routes. In my view, it appears as though KQ management, in formulating Project Mawingu, did not focus on the right variables mix. You cannot capacitise low-margin and cut-throat competitive routes while clearly you have cost-containment issues, struggle to fill planes and not fully-equipped to compete. That’s a ruinous combination. As KQ folds into a leaner structure, I really hope they focus on the right variables mix. [The author: George Bodo] [Five airlines express interest in buying majority stake in KQ]
Ethiopian Airlines: an example to SAA? (Daily Maverick)
While it remains a “hub-and-spoke” carrier out of Addis, the airline’s establishment of regional hubs in Togo, West Africa (through its investment in Asky), in southern Africa (through Air Malawi) and, it is planned, in Central Africa offers further possibilities for competitive growth. What of the lessons for others? [The author: Greg Mills]
Singapore's investments in Africa: 'not evenly distributed' (Daily Nation)
The total trade between Singapore and Africa in 2015 totalled a mere 10.9 billion Singapore dollars while its investment in Africa was a whopping 21.6 billion Singapore dollars in the previous year. This is one country compared to an entire continent but then, Singapore's investments in the continent have not been evenly distributed due to lack of ease in doing business in some countries. This was said at a conference that started on Wednesday in Singapore held under the auspices of the country's Ministry of Trade and Industry and aptly named "Increasing Connectivity".
Kenya's SGR, related updates: Robert Shaw commentary, How Lapsset is key to Kenya gaining competitive transport edge, RVR says new rail will not affect its exclusive contract, Kenya, Ethiopia bet on technology transfer in their railway projects
SADC statistics bodies harmonise goals
Four ways regional bodies can help deliver justice commitments made through the SDGs (World Bank)
ECOWAS Conflict Prevention Framework: update
International Day of Family Remittances, 16 June: World Bank, IFAD, WSBI and UNCDF statement, IOM statement, commentary
MTN to list in Nigeria as part of $1.7 billion fine deal (The East African)
India’s exports contract 0.79% in May, imports slip 13% (LiveMint)
India: On the 27 road corridors to a better trade regime (LiveMint)
South Africa, India, Brazil, China team up to push EU to change trademark law (The Hindu)
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