News
tralac’s Daily News Selection
The selection: Monday, 27 June 2016
SADC Double Troika meeting will take place tomorrow in Botswana
SADC TFCAs: consultancy for developing a framework for monitoring and evaluation of impact
Selected Brexit commentaries: Anzetse Were, Sir Ronald Sanders, Peter Ungphakorn, Olly Owen, Grieve Chelwa
Selected Brexit news reports: South Africa: Davies seeks to calm anxieties over UK vote fallout (Business Day), African exporters face choppy waters in the wake of Brexit (The Conversation), East Africa braces itself for implications of UK-EU exit vote on economies, trade (The East African), The UK-EU divorce will leave Indian exporters bruised (Quartz India)
LDC Group post-Nairobi priorities in the WTO (Trade Negotiations Committee, sub-committee on LDCs)
The LDC Group presents this first communication (circulated by Benin) to reflect its collective view on WTO work post-MC10, building on the elements contained in the Nairobi Ministerial Declaration, as a contribution to the work ahead and to identify issues of priority for LDCs. It should be recalled that Ministers in Nairobi instructed that Members address LDC issues and interests on a priority basis, as provided in paragraph 24 of the Declaration. The elements of this communication are set out in the following categories: i) Implementation of all decisions taken in favour of LDCs, ii) Remaining areas of the DDA of importance to LDCs, and iii) News Issues and Paragraph 34 of the Nairobi Ministerial Declaration. The LDC Group will consider additional submissions, as appropriate.
Lesotho: Building capacity on trade and trade-related policy issues (Lesotho Times)
Commonwealth Hub & Spokes II Programme in Lesotho, Mr Samuel Ato Yeboah, has a very important role to play in supporting Lesotho's trade and development agenda. He spoke with Lesotho Times reporter Bereng Mpaki about the full mandate of his office. [Govt warned over SADC recommendations]
Profiled presentations from the Fifth Meeting of Trade Ministers of Landlocked Developing Countries (23-24 June): David Luke, Heini Suominen, William Petty, Jan Hoffmann, Marion Jansen, Michael Roberts
SACU headwinds: South Africa insists on sharing formula redesign (Swazi Observer)
According to a presentation made by South Africa during the recently held SACU Ministerial Retreat, South Africa says the formula redesign could reduce volatility, ensure that the development component was spend on addressing structural impediments and achieving the original SACU goals. “A redesign of the formula should facilitate stronger trade links,” said RSA’s presentation. Using the case of Poland, the Republic argued that well structured funds could change the fortune of countries. In 2004, Poland was below the threshold of 75% of the EU average in GDP per inhabitant. This resulted in large developmental funds flowing to Poland from the EU. Between 2004 and 2015, various projects were implemented to address Poland’s underdevelopment compared to other countries which resulted to large investment in programmes to support human capital, innovation small and medium enterprise development, and the environment. “No development funds were spent on general government consumption expenditure, including government wages. Funds were well managed,” insisted South Africa.
The potential for regional value chains in the automotive sector: can SADC learn from the ASEAN experience? (SAIIA)
Despite the fact that the middle class in Southern Africa is growing, vehicle ownership is still minimal. It is thus appropriate to examine the prospects for a similar scheme within SADC. South Africa has by far the most developed automotive sector in the region, while Zimbabwe and Botswana are both attempting to build up their industries and Mozambique is beginning to receive foreign direct investment. Due to South Africa’s automotive dominance, regional integration has not expanded much beyond its exporting components and vehicles to other countries in the region. There is also an emerging trend of South African companies’ shifting production of certain components to other SACU countries. Additionally, insufficient regional market demand for new vehicles prevents the realisation of economies of scale in production, and manufacturing in SADC is not very competitive due to infrastructure bottlenecks and labour market constraints. The effective implementation of a regional Common Effective Preferential Tariff and even enforcement of the existing SADC and SACU Rules of Origin are hampered by the low levels of local value addition. Despite these barriers, there are measures that SADC, South Africa and private investors can take and are taking to enhance the prospects of regional automotive integration.
Zambia’s Trade Policy Review: statement by the United States (USTR)
During the period of review, Zambia exported a very limited number of products to the United States under the provisions of AGOA. We encourage the Government of Zambia to develop an AGOA utilization strategy to take better advantage of the program, and as called for in the latest AGOA legislation. In this connection, we are pleased to note our partnership with Zambia under Trade Africa, which is an initiative launched during the Obama Administration aimed at increasing African regional trade, as well as trade with the United States. Under our Trade Africa partnership with Zambia, we are committed to working with the Government of Zambia not only to help it make greater use of the benefits of AGOA to increase bilateral trade, but also to help it improve its capacity to boost regional trade and make the most of the opportunities afforded by its membership in the WTO. We agree with the Secretariat’s report that Zambia’s participation in the multilateral trading system remains limited. We encourage Zambia to continue to work towards establishing a transparent trade policy process that will allow for more active engagement in the multilateral trading system and more follow-up on multilateral issues, recognizing the capacity challenges Zambia faces. We also encourage Zambia to continue efforts to improve implementation of the WTO agreements, including the Customs Valuation, Sanitary and Phytosanitary (SPS), and Technical Barriers to Trade (TBT) Agreements. [TPR documentation]
TFTA: ‘Unity of regional trading blocs crucial to end fake products’ (Tanzania Daily News)
Uniting the EAC, SADC and COMESA is the only remedy left to curb infiltration of sub-standard and fake goods from outside the continent, a senior government official has said. “Through the Free Trade Area (FTA) joining the various trading blocs in Africa will ensure united strength in fighting the growing waves of poor, sub-standard, counterfeit and faked products,” said the Minister for Industry, Trade and Investment, Mr Charles Mwijage. He was speaking during the 22nd General Assembly of the African Organisation for Standardisation and its related ‘Made in Africa Expo’ which has just been held in Arusha. The meeting addressed the issue of standards and how countries can combat issues of sub-standard and faked products.
EAC states review CET to protect imported goods from double taxation (The East African)
The EastAfrican has learnt that the proposed review of the EAC three-band tariff could see excessive protection granted to sensitive goods such as maize, rice, wheat, textiles and sugar abolished and a uniform duty applied to the products. Kenya has requested a stay of the application of a 10% duty on wheat grain instead of 35% while Rwanda has requested a stay of the application of $0.4 per kilogramme on second hand clothes and other articles. Wheat and textile are classified as sensitive goods and their imports attract higher duty because the idea is to protect local industries. [Doubts increase over falling revenue, region’s ability to repay rising debts]
AGOA and the 2016 Fashion Industry Benchmarking Study (pdf, US Fashion Industry Association)
33% say their company has started to source more textiles and apparel from the AGOA region, while 14% further say their company will strategically adjust or redesign the supply chain based on AGOA in the next five years. However, even with the 10-year AGOA extension, only 14% of respondents are willing to make more investment, such as building factories and expanding sourcing, in the AGOA region at this point, though they recognize capacity building is critical to encourage more sourcing from Africa.
Chinese textile sector expresses interest to invest in Ethiopia (YNFX)
Delegation leader of the three associations, China Textile Association, Hong Kong Chamber of Textile Association, and Chinese Chamber of Light Manufacturing, Helen Hai held talks with Prime Minister Hailemariam Dessalegn on ways of facilitating investment in Ethiopia yesterday.
Kenya seeks review of Rwanda, Uganda poll violence claims (The East African)
Kenya is seeking fresh negotiations with Rwandan and Ugandan traders as the government seeks to cut the compensation bill arising from the post-election violence that rocked the country eight years ago. The traders, through regional lobby East African Business Council, had earlier settled for Ksh4.75 billion ($47.5 million) after the Kibaki administration convinced them to drop their bid to challenge Kenya in an international court.
Mozambique: Cost of compliance in agriculture (pdf, SPEED)
Based on interviews with a wide range of agribusiness companies in Mozambique, and drawing on survey data recently collected by the Grow Africa/New Alliance group on agribusiness companies which have signed letters of intent with the Government of Mozambique to undertake or increase their investments in the country, this report itemizes a series of constraints which have contributed to this investment under-performance in the agribusiness sector. This constraint analysis covers ground which will be familiar to students of agribusiness in Mozambique: [Proposal for humanitarian relief assistance related to the 2016 drought disaster (pdf)]
Now posted: The AfDB's 'Feed Africa - strategy for agricultural transformation in Africa 2016-2025' (pdf, AfDB)
Gain a ‘fair share’ of export-orientated commodity value chains: As an initial step toward reaching the top of target export-orientated value chains, the strategy will aim to support Africa in gaining its ‘fair share’ in key export-orientated value chains where a comparative advantage might exist. Promising value chains include those for which agro-ecological endowments uniquely position Africa to fill demand during periods of low supply in other exporting regions — for example, horticulture products destined for North American and European markets — and those for which African producers dominate supply, such as in cocoa. Cashew will also be a key priority. Examples of future target value chains include: coffee and cotton. The overall agribusiness environment should also be improved in order to expand access to regional and international markets.
African Solidarity Fund to finance investment projects (New Times)
Rwandans should take advantage of financial opportunities offered by the African Solidarity Fund by using its guarantee to access investment loans, the fund’s director-general has said. Ahmadou Abdoulaye Diallo made the call, yesterday, while opening the Fund’s 7th Annual General Meeting in Kigali, which was used to assess its performance and how stakeholders in the economies of the Fund’s fourteen member countries in Africa can benefit. The 40-year-old body is now worth about Rwf29 billion, which is a disbursed contribution from governments in its thirteen member countries from mostly Central and Western Africa, including Rwanda and Burundi.
Botswana: Economic growth target too optimistic – BoB (Mmegi)
The economy is unlikely to expand by the projected 4.2%this year as the country continues to face multiple challenges, Bank of Botswana believes. In a report highlighting the 2016 Business Expectations Survey (pdf), the central bank said in spite of the fiscal interventions through the Economic Stimulus Programme there still exist challenges that are likely to retard economic growth to levels south of the projected 4.2%.
West Africa's Ebola crisis: final impact update (World Bank)
This update presents the World Bank’s final analysis of the economic and fiscal effects of the 2014-2015 West African Ebola epidemic and commodity price shocks across the three most affected countries of Guinea, Liberia, and Sierra Leone. In relation to the Bank’s April 2015 update, this report provides an updated overview of the status of the three economies. The overall impact of the Ebola crisis on Guinea, Liberia, and Sierra Leone has been estimated at $2.8bn ($600m for Guinea, $300m for Liberia, and $1.9bn for Sierra Leone). This includes the shocks in 2014 and 2015, and the projections for 2016 as the economic impact is outlasting the epidemiological impact. The shock has been worsened by the large decline in the world price of iron ore and other commodities, and specifically for Sierra Leone, corporate governance issues in mining.
Uhuru Kenyatta travels to Botswana for trade talks (Daily Nation)
High level WTO team expected in Liberia; post accession needs plan to be identified (FrontPage Africa)
Four ways the new Panama Canal will change the world (Maersk)
Higher container volumes lift SA's Transnet (IOL)
Hong Kong timetables total ban on ivory trading for first time (Reuters)
New interactive tool tracks political violence in Sub-Saharan Africa (CFR)
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