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BRICS Industry and Trade ministers meet this week in South Africa (4 and 5 July, respectively, pdf)
Diarise: Launch of the AUC’s inaugural African Development Dynamics Report (11 July, Addis): “By analysing the economic development of Africa using an African analytic grid, it will contribute to the definition and implementation of innovative policies that are adapted to the specific characteristics of each economy and that further the AU’s priorities”
31st Summit of the African Union: updates
(i) Address by President Paul Kagame (pdf): These positive developments remind us that partnership is the common thread in this Summit’s deliberations. Partnership amongst ourselves, first of all. Thanks to the outstanding work of the Committee of 15 Finance Ministers, together with the Executive Council, the African Union has applied the “golden rules” and adopted the most credible and transparent budget in our history. Through this process, the 2019 budget presented to the Assembly for consideration has even been reduced by 12%, compared to 2018. At the same time, contributions to the Peace Fund have never been higher. As a direct result of the growing confidence in our finances, the AU is in a position to work toward a long-term partnership with the UN Security Council for stable funding for peacekeeping operations in Africa.
Several more Member States are expected to sign the AfCFTA at this Summit and six countries have already ratified. We congratulate those who have done so. The agreement is well on its way to entering into force. From that point forward, Africa will necessarily engage with partners as a bloc. The renewal of Africa’s relationship with the EU intervenes in this context. The AU’s position reflects the need to modernise and expand the terms of the partnership to the full range of issues facing our two continents. It is also a good time to deepen the African Union’s relationship with our “Sixth Region” brothers and sisters in the Caribbean. Our partners are receptive to Africa’s viewpoint, but it is essential that we speak with one voice. Respect for AU decisions makes us more formidable and protects individual countries from pressure and manipulation.
SACU Heads of State or Government Summit: communiqué
Ahead of next week’s AGOA Forum in Washington: The USTR posts its 2018 Biennial Report on the Implementation of the African Growth and Opportunity Act
(i) From Chapter V: The Administration also encourages the region to take full advantage of AGOA over the coming years by developing AGOA utilization plans. Given that AGOA was not designed to be the permanent mechanism by which the United States engages its sub-Saharan African trading partners, the Administration also encourages beneficiaries to consider a more stable, permanent, and mutually beneficial engagement on trade and investment. Many African countries and regional groups – some of them among the fastest growing economies in the world, with a rapidly growing population and rising middle class – are moving away from preferences and toward more advanced trade arrangements, both with African and non-African trading partners. US exporters to Africa, particularly small and medium-sized companies, will increasingly find themselves at a disadvantage vis-à-vis foreign competitors as the reciprocal agreements that African countries sign with other trade partners take effect. In this context, it will become increasingly important that the United States and its sub-Saharan trading partners move toward more advanced trade arrangements.
(ii) AGOA success stories (pp13-14):
Apparel: Kenya, Lesotho, Madagascar, and Mauritius have been the leading exporters of apparel under AGOA, accounting for almost 90% of AGOA apparel exports in 2017. Increased apparel exports under AGOA have also led to improved productivity and employment opportunities. For instance, in Kenya, UAL Apparel Factory is a leading exporter that supplies many large retail chains, including Levi Strauss and H&M. Since the extension of AGOA in 2015, UAL has added thousands of jobs, and currently employs nearly 10,000 Kenyans. Overall, 40,000 Kenyans are employed in the apparel export industry.
South Africa: South Africa is the largest nonoil beneficiary of AGOA by value. The country accounts for 68% of non-oil AGOA exports to the US South African exports to the US under AGOA have increased three-fold since its enactment in 2000, primarily from industry and agricultural sectors. Transportation equipment increased from $76m in 2001 to $1.3bn in 2017, adding over 30,000 jobs. South African exports of agricultural products increased nearly sevenfold since 2001 to $278m in 2017.
Kenya: Kenyan exports of macadamia nuts to the United States under AGOA totalled $72,000 in 2000, and then rose quickly to $8m by 2004 and to $52m in 2017. Exports of these products support over 100,000 farmers with an average of six to twelve trees per grower, typically as part of a diversified agricultural smaller-holder operation.
Ethiopia: In 2018, Ethiopia’s shoe exports continue to grow rapidly compared to the 2017 totals (up 58%), making the country the first substantial AGOA footwear supplier to the United States.
(iii) Table of contents: Chapter I: The trade and investment relationship between the United States and Sub-Saharan Africa; Chapter II: AGOA eligibility review and country reports; Chapter III: Status of trade capacity building assistance to Sub-Saharan Africa; Chapter IV. Status of regional integration; Chapter V. Strengthening bilateral relations moving forward.
Angola eyes cleaner, greener economic growth: coffee, honey, timber (UNCTAD)
These are three of a handful of products for which government officials and industry representatives believe Angola could be competitive. The list, which includes fish, salt and bananas, was compiled during a two-week workshop in Luanda (11-22 June) as part of a 4-year project financed by the EU to help Angola strengthen and diversify its economy. Angola currently produces 90 tons of honey each year. But analysis done during the workshop showed production could more than double to 200 tons if new technologies were used. Likewise, the economic potential of the country’s 53 million hectares of forest remains untapped. Coffee also holds the promise of a better future, especially for the 50,000 or so registered producers, almost all of which are family-run small farms. Though Angola only produced around 8,000 tons of coffee in 2017, the country used to be a top producer – reaching almost 230,000 tons per year in the 1970s. With better production methods and quality control, the participants said, Angola could once again be a major player.
Africa must lead e-commerce before ‘outsiders’ take over (UNCTAD)
Young African digital entrepreneurs must lead the development of e-commerce in Africa before commercial interests from elsewhere become established, UNCTAD Secretary-General Mukhisa Kituyi has said. Dr Kituyi was speaking to nearly 30 young entrepreneurs from 11 countries in Africa who completed the third eFounders Fellowship course run by UNCTAD and Alibaba at the Alibaba Business School in Hangzhou, China. The eFounders Fellows were selected through a rigorous application process. All are founders or co-founders of platform-based ventures in the ecommerce, logistics, fintech, big data or tourism industries in Africa.
WTO DG Azevêdo: “Our efforts in the WTO must translate into real trade gains for LDCs” (WTO)
The Negotiating Group on Rules remains a notable bright spot. The group is proceeding with a real sense of urgency and is proceeding with its programme of work to advance discussions on fisheries subsidies. I understand that an outcome on fisheries subsidies is of great interest to many LDCs as significant sections of your population depends on the earnings from this sector. With this in mind, I must say that if we are to meet the 2019 deadline that was set in Buenos Aires, we will have to shift gears. It won’t be enough for members to simply continue restating (i) how important this issue is for them; or (ii) what their sensitivities are – we need new ideas that could lead to convergence. So far I don’t detect any real attempts or efforts to change positions. So, in all of my interactions with ministers I have been urging them to get engaged and to begin making much needed political calls. We also need to find ways of advancing in other areas as well. Agriculture and development are two of the most critical areas. But they are also the more difficult ones before us: [Note: an extract from a speech delivered to a meeting of the LDCs Group, 28 June]
The unseen impact of non-tariff measures: insights from a new database (pdf, updated preliminary draft report, UNCTAD/World Bank)
Together with the World Bank, UNCTAD has been able to mine the TRAINS database, which was launched in 2016, for insights that prove useful not only to researchers but governments and companies in both developed and developing countries. “The depth of understanding of the trade effects of NTMs, which have expanded in recent years, remains shallow,” said Mr Peters who presented findings from the database to World Bank and UNCTAD colleagues on 28 June. Among the findings Mr Peters reports are: Developed countries regulate a larger share of products and imports than developing countries; Agricultural products are more regulated than manufactured goods and natural resources; TBTs are the most frequent form of NTM; The cost of NTMs is about 5 to 7% of imports on a simple average basis, and 2 to 3.5% considering import weighted averages (this is to be expected because the presence of NTMs itself tends to restrict trade); The average cost of NTMs tends to be higher for exporters in countries with a lower per capita GDP; For agricultural products, NTMs represent a cost to trade of about $75 billion; For manufacturing the cost is about $25bn, given that the international trade in goods in manufactured goods is much larger than that of agriculture
ITC-WCO Rules of Origin Facilitator to benefit MSMEs (ITC)
A new initiative that will enable micro, small and medium-sized enterprises to benefit from international trade opportunities was unveiled last week by the ITC and the WCO. Available online the ITC-WCO Rules of Origin Facilitator contains information on trade agreements and applicable tariff rates at the detailed product level. The database includes the product-specific rules of origin as well as provisions on origin certification. Necessary documentation, such as certificates of origin, is also provided. Currently, the initiative covers the destination markets of 85 countries including most of the developed economies. The online tool is comprehensive in its coverage providing information on all tradable goods, ranging from raw agricultural commodities to sophisticated machinery and electronics.
Monday’s Quick Links: South Africa: Merchandise trade statistics for May 2018 show a surplus of R3.52bn IATA’s June 2018 State of the region report: Africa and Middle East (pdf) COMESA Authority extends SG’s mandate pending successor’s appointment EABC appoints Mr Nicholas Nesbitt as new chairperson SADC to develop regional tourism programme Ethiopia embraces the IGAD protocol on transhumance AU Commissioner for Infrastructure, Energy and Tourism: “Tourism supports 21 million jobs in Africa” ICTSD: WTO members intensify debate over resolving appellate body impasse UN launches plan to promote peace, inclusive growth in Africa’s Sahel: download the UN support plan – Sahel, land of opportunities The security and migration situation in Africa: communique of the 782nd PSC meeting Kunio Mikuriya re-elected as WCO Secretary General |
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African Heads of State and Government hold their 31st AU Summit Meeting in Mauritania
The supreme organ of the African Union, the Assembly, which comprises Heads of State and Government of all the 55 African countries, began its 31st ordinary session on 1 July 2018 in Nouakchott, Islamic Republic of Mauritania.
The Assembly meeting is the culmination of the statutory meetings and was preceded by the meetings of the Executive Council and the Permanent Representatives’ Committee.
Among the responsibilities of the Assembly are to receive, consider and take decisions on reports and recommendations from the organs of the Union; monitor the implementation of policies and decisions of the Union, as well as ensure compliance by all member states; and give directives to the Executive Council on the management of conflicts, war and other emergency situations.
In this regard, the Heads of State and Government will receive several reports including the status of the implementation of the AU Institutional Reforms to be presented by President Paul Kagame of Rwanda who is the current chair of the African Union and the champion for the AU Institutional Reforms process; President Mamadou Issoufou of Niger will report on the status of the African Continental Free Trade Area (AfCFTA) which has been signed by 44 countries and ratified by Kenya, Ghana, Rwanda and Niger.
South Africa, Sierra Leone, Lesotho, Burundi, and Namibia signed the pdf Agreement establishing the AfCFTA (973 KB) on 1 July 2018 in Nouakchott while Eswatini and Chad deposited their instruments of ratification of the AfCFTA.
The Chairperson of the African Union Commission Mr. Moussa Faki Mahamat will present reports on the issue of Western Sahara as well as a report on the African Common Position Post 2020.
Reports on Peace and Security on the continent will also be presented to gauge the progress made in reducing armed conflicts on the continent in line with AU master roadmap of practical steps towards Silencing the Guns which is one of the key projects of Africa’s Agenda 2063.
While making his opening remarks, President Kagame commended the efforts made in the planning of the 2019 budget of the African Union which resulted in a reduction of 12% in the budget compared to 2018. President Kagame remarked that, “The African Union has applied the ‘golden rules’ and adopted the most credible and transparent budget in our history.”
The Heads of State and Government will consider and adopt the 2019 budget of the AU following recommendations of the ministerial level Executive Council, which met from the 28th to 29th of June.
On his part while speaking on the issues peace and security, the AUC Chairperson Mr. Moussa Faki Mahamat noted that the question of peace, security and stability remained a major pre-occupation on the continent saying “The attack on the headquarters of the G5 a few days ago, highlights the need for increased mobilisation in support of the region, if necessary.”
The Summit is being held under the 2018 theme of the year “Winning the Fight Against Corruption: A Sustainable Path to Africa’s Transformation. The Mauritanian President, Mr. Mohamed Ould Abdel Aziz underscored the importance of the theme, saying, “Winning the fight against corruption is a prerequisite for our progress and prosperity”.
A panel discussion led by President Muhammadu Buhari of the Federal Republic of Nigeria and the champion of the 2018 theme will take place at the Summit and it aims to evaluate the progress made in fighting corruption and developing new strategies to curb the vice.
The Assembly was addressed by the UN Deputy Secretary General Ms. Amina J. Mohammed who remarked that the AU and UN are working together successfully across the continent with Africa firmly in the lead and there was a need to do more to strengthen the partnership.
The Assembly was also addressed by Mr. Ahmed Aboul Gheit, Secretary General of the Arab League and Dr. Riad Malki Minister of Foreign Affairs of the State of Palestine who made a statemen on behalf of the President of Palestine Mr. Mahmoud Abbas representative of the leader of the State of Palestine.
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South Africa Merchandise Trade Statistics for May 2018
South Africa’s trade surplus widens in May
South Africa’s trade surplus increased to R3.52 billion from aun upwardly revised R1.17 billion in the previous month and below market expectations of a R5.9 billion surplus. Considering the January to May period, the country posted a trade deficit of R17.77 billion.
Exports jumped 16.0 percent month-over-month to R102.6 billion in May of 2018, boosted by vegetable products (56 percent); prepared foodstuff (32 percent); vehicles and transport equipment (29 percent); chemicals (28 percent) and mineral products (11 percent). Main export partners were: China (9.4 percent of total exports), Germany (7.7 percent), the US (6.6 percent), the UK (5.4 percent) and India (5.3 percent).
Imports advanced 13.5 percent month-over-month to R99.1 billion, driven by higher purchases of vegetable products (135 percent); vehicle and transport equipment (26 percent); base metals (25 percent); original equipments components (15 percent) and machinery and electronics (9 percent). The most important import partners were: China (18.8 percent of total imports), Germany (10.1 percent), the US (5.7 percent), Nigeria (4.8 percent) and India (4.2 percent).
Excluding trade with neighboring Botswana, Lesotho, Namibia and Swaziland, the country recorded a trade deficit of R4.65 billion in May.
The South African Revenue Service (SARS) has released trade statistics for May 2018 recording a trade balance surplus of R3.52 billion. These statistics include trade data with Botswana, Lesotho, Namibia and Swaziland (BLNS).
The year-to-date (01 January to 31 May 2018) trade balance deficit of R14.18 billion is a deterioration on the surplus for the comparable period in 2017 of R16.41 billion. Exports year-to-date decreased by 0.4% whilst imports for the same period showed an increase of 6.4%.
Including trade data with Botswana, Lesotho, Namibia and Swaziland (BLNS)
The R3.52 billion trade balance surplus for May 2018 is attributable to exports of R102.61 billion and imports of R99.09 billion. Exports increased from April 2018 to May 2018 by R14.15 billion (16.0%) and imports increased from April 2018 to May 2018 by R11.80 billion (13.5%).
Exports for the year-to-date (01 January to 31 May) decreased by 0.4% from R461.52 billion in 2017 to R459.58 billion in 2018. Imports for the year-to-date of R473.76 billion are 6.4% more than the imports recorded in January to May 2017 of R445.11 billion, leaving a cumulative trade balance deficit of R14.18 billion for 2018.
On a year-on-year basis, the R3.52 billion trade balance surplus for May 2018 is a deterioration from the surplus recorded in May 2017 of R7.89 billion. Exports of R102.61 billion are 0.8% less than the exports recorded in May 2017 of R103.39 billion. Imports of R99.09 billion are 3.8% more than the imports recorded in May 2017 of R95.50 billion.
April 2018’s trade balance surplus was revised upwards by R0.26 billion from the previous month’s preliminary surplus of R1.14 billion to a revised surplus of R1.17 billion as a result of ongoing Vouchers of Correction (VOC’s).
Trade highlights by category
The main month-on-month export movements: R’ million |
||
Section:
|
Including BLNS:
|
|
Vehicles & Transport Equipment
|
+R2 671
|
+29%
|
Vegetable Products
|
+R2 390
|
+56%
|
Mineral Products
|
+R2 342
|
+11%
|
Chemical Products
|
+R1 507
|
+28%
|
Prepared Foodstuff
|
+R1 124
|
+32%
|
Machinery & Electronics
|
+R1 052
|
+14%
|
Base Metals
|
+R 896
|
+8%
|
Total
|
+R11 982
|
85%
|
Total Movement |
+R14 155 |
100% |
The main month-on-month import movements: R’ million |
||
Section:
|
Including BLNS:
|
|
Vehicles & Transport Equipment
|
+R1 938
|
+26%
|
Machinery & Electronics
|
+R1 857
|
+9%
|
Vegetable Products
|
+R1 713
|
+135%
|
Original Equipment Components
|
+R1 066
|
+15%
|
Base Metals
|
+R1 007
|
+25%
|
Chemical Products
|
+R 707
|
+7%
|
Precious Metals & Stones
|
+R 605
|
+60%
|
Textiles
|
+R 587
|
+20%
|
Miscellaneous Manufactured Articles
|
+R 537
|
+46%
|
Wood Pulp & Paper
|
+R 513
|
+21%
|
Works of Art
|
-R 142
|
-72%
|
Total
|
+R10 388
|
88%
|
Total Movement |
+R11 804 |
100% |
Trade highlights by world zone
The world zone results from April 2018 (revised) to May 2018 are given below.
Africa:
Trade Balance surplus: R15 604 million – this is an improvement of R2 887 million in comparison to the R12 717 million surplus recorded in April 2018.
America:
Trade Balance deficit: R 820 million – this is an improvement of R 655 million in comparison to the R1 475 million deficit recorded in April 2018.
Asia:
Trade Balance deficit: R10 587 million – this is a deterioration of R 453 million in comparison to the R10 134 million deficit recorded in April 2018.
Europe:
Trade Balance deficit: R4 249 million – this is an improvement of R1 888 million in comparison to the R6 137 million deficit recorded in April 2018.
Oceania:
Trade Balance deficit: R1 231 million – this is a deterioration of R1 036 million in comparison to the R 195 million deficit recorded in April 2018.
Excluding trade data with Botswana, Lesotho, Namibia and Swaziland (BLNS)
The trade data excluding BLNS for May 2018 recorded a trade balance deficit of R4.65 billion. This was a result of exports of R91.43 billion and imports of R96.08 billion.
Exports increased from April 2018 to May 2018 by R13.21 billion (16.9%) and imports increased from April 2018 to May 2018 by R11.70 billion (13.9%).
The cumulative deficit for 2018 is R50.43 billion compared to R18.29 billion deficit in 2017.
Trade highlights by category
The main month-on-month export movements: R’ million |
||
Section:
|
Excluding BLNS:
|
|
Vehicles & Transport Equipment
|
+R2 523
|
+31%
|
Vegetable Products
|
+R2 357
|
+63%
|
Mineral Products
|
+R2 108
|
+10%
|
Chemical Products
|
+R1 318
|
+29%
|
Prepared Foodstuff
|
+R 928
|
+37%
|
Machinery & Electronics
|
+R 897
|
+15%
|
Base Metals
|
+R 835
|
+ 8%
|
Other Unclassified
|
-R 70
|
-18%
|
Total
|
+R10 896
|
82%
|
Total Movement |
+R13 209 |
100% |
The main month-on-month import movements: R’ million |
||
Section:
|
Excluding BLNS:
|
|
Vehicles & Transport Equipment
|
+R1 951
|
+26%
|
Machinery & Electronics
|
+R1 740
|
+ 9%
|
Vegetable Products
|
+R1 710
|
+138%
|
Original Equipment Components
|
+R1 066
|
+15%
|
Base Metals
|
+R1 020
|
+26%
|
Precious Metals & Stones
|
+R 663
|
+128%
|
Chemical Products
|
+R 643
|
+ 7%
|
Textiles
|
+R 584
|
+24%
|
Miscellaneous Manufactured Articles
|
+R 534
|
+46%
|
Wood Pulp & Paper
|
+R 511
|
+21%
|
Works of Art
|
-R 142
|
-72%
|
Total
|
+R10 280
|
88%
|
Total Movement |
+R11 698 |
100% |
Trade highlights by world zone
The world zone results for Africa excluding BLNS from April 2018 (Revised) to May 2018 are given below.
Africa:
Trade Balance surplus: R7 437 million – this is an improvement of R2 047 million in comparison to the R5 390 million surplus recorded in April 2018.
Botswana, Lesotho, Namibia and Swaziland (Only)
Trade statistics with the BLNS for May 2018 recorded a trade balance surplus of R8.17 billion. This was a result of exports of R11.18 billion and imports of R3.01 billion.
Exports increased from April 2018 to May 2018 by R0.95 billion (9.3%) and imports increased from April 2018 to May 2018 by R0.11 billion (3.7%).
The cumulative surplus for 2018 is R36.25 billion compared to R34.70 billion in 2017.
Trade Highlights by Category
The main month-on-month export movements: R’ million |
||
Section:
|
BLNS:
|
|
Mineral Products
|
+R 234
|
+ 19%
|
Prepared Foodstuff
|
+R 196
|
+ 15%
|
Chemical Products
|
+R 189
|
+ 21%
|
Machinery & Electronics
|
+R 155
|
+ 11%
|
Vehicles & Transport Equipment
|
+R 148
|
+ 15%
|
Base Metals
|
+R 61
|
+ 8%
|
Textiles
|
+R 34
|
+ 6%
|
Plastics & Rubber
|
+R 34
|
+ 8%
|
Precious Metals & Stones
|
-R 262
|
- 45%
|
Total
|
+R 789
|
83%
|
Total Movement |
+R 946 |
100% |
The main month-on-month import movements: R’ million |
||
Section:
|
BLNS:
|
|
Machinery & Electronics
|
+R 117
|
+ 49%
|
Chemical Products
|
+R 63
|
+ 15%
|
Wood & Articles Thereof
|
+R 31
|
+ 29%
|
Vehicles & Transport Equipment
|
-R 13
|
- 27%
|
Base Metals
|
-R 13
|
- 12%
|
Prepared Foodstuff
|
-R 27
|
- 6%
|
Precious Metals & Stones
|
-R 58
|
- 12%
|
Total
|
+R 100
|
94%
|
Total Movement |
+R 106 |
100% |
Related News
DG Azevêdo: “Our efforts in the WTO must translate into real trade gains for LDCs”
Addressing a meeting of the Least Developed Countries (LDCs) Group on 28 June 2018, Director-General Roberto Azevêdo said WTO members need to build on the progress achieved on LDC issues in recent years.
He emphasized in particular the importance of implementing decisions taken at the Bali and Nairobi ministerial conferences on issues that are of importance for LDCs. He said that countries graduating from LDC status need special attention and that efforts need to be made on all fronts to boost LDC trade and to help achieve the Sustainable Development Goals. This is what he said:
Remarks by DG Azevêdo
First of all, I would like to thank Ambassador Leopold Samba for inviting me to address this important meeting – and to congratulate him for his work as the Coordinator of the LDC Group. I am pleased that UNCTAD Secretary-General Mukhisa Kituyi could join us this morning.
I applaud the LDC Group for taking the initiative to arrange this meeting. You are one of the most active groups in the WTO. This is reflected in the substantive progress that has been achieved on LDC issues over recent years.
It is vital now that we build on that progress and that we deliver on your priority issues so that LDCs can more fully benefit from global trade.
With this in mind I want to give you a full overview of the current issues this morning.
Let me start with some positive developments.
In 2017, global trade growth bounced back quite strongly. And the LDCs also experienced a trade recovery.
In 2017, the value of merchandise exports of the LDCs increased by 13%. This is remarkable as it follows three years of negative growth rates.
Thanks largely to increases in the prices of fuels and mining products, LDC exports grew faster than world exports by value. However, despite these developments, the share of LDCs in world merchandise exports only improved slightly. It remains below 1%.
The expansion of global trade is expected to continue if economic growth remains robust. However, as you all know, we face challenging times. Trade tensions persist between major trading partners.
Many measures that restrict trade have been announced in recent days and weeks. If we continue down this path of further escalation, we will be facing not only the obvious economic risks, but also major systemic risks.
I am in close contact with the key players and urging them to show maximum restraint. Of course what happens next is ultimately in their hands, but all members have a stake in this.
In today’s interconnected economy, the escalation of trade tensions would have damaging knock-on effects which would reach every economy – and it would not spare LDCs. Similarly, potential threats to the future of the trading system should be a concern for us all.
Now let me turn to MC11.
I won’t take up any time by reminding you what was agreed in Buenos Aires. You were all there. I will just say that while we didn’t achieve all we may have wanted, we did make important progress.
Since then work has resumed in the respective bodies. I have continued my engagements with members – both in Geneva and in capitals.
In terms of substantive progress in the different areas, I would just say that it is still quite early in the process after the ministerial. All of the Negotiating Groups are up and running again and members are meeting and engaging – but these are still early days.
The Negotiating Group on Rules remains a notable bright spot. The group is proceeding with a real sense of urgency and is proceeding with its programme of work to advance discussions on fisheries subsidies.
I understand that an outcome on fisheries subsidies is of great interest to many LDCs as significant sections of your population depends on the earnings from this sector. With this in mind, I must say that if we are to meet the 2019 deadline that was set in Buenos Aires, we will have to shift gears.
It won’t be enough for members to simply continue restating (i) how important this issue is for them; or (ii) what their sensitivities are – we need new ideas that could lead to convergence.
So far I don’t detect any real attempts or efforts to change positions. So, in all of my interactions with ministers I have been urging them to get engaged and to begin making much needed political calls.
We also need to find ways of advancing in other areas as well.
Agriculture and development are two of the most critical areas. But they are also the more difficult ones before us. And in both areas I think a more meaningful conversation is needed. We also have to deal urgently with issues such as public stockholding, where the deadline that members set has already passed.
I understand that the next Agriculture Special Session is scheduled for 16 July – followed by a dedicated discussion on Public Stockholding and the SSM.
So I would encourage you to continue this work.
On S&D treatment, you all are aware of the discussions on development that took place at MC11, and the divisions which came to the fore.
Since then the Chair has been meeting the stakeholders in various formats. And I understand that in her recent consultations, a number of suggestions and ideas have been put forward.
We are confronting two major issues here:
-
First, we need to have a frank discussion on the specific needs of developing countries, especially the LDCs, as we take forward the different proposals.
-
Second, we need to be realistic in what we could achieve given the sharp differences in perspectives of members on how S&D treatment should be approached in the WTO.
I understand that members are showing interest in further exploring some of the useful ideas that have been put forward in the Chair’s consultations after MC11. I would encourage you to approach this with a pragmatic mind-set, and focus on a few proposals which you think are most important in achieving your development objectives.
There is an opportunity here for constructive dialogue, building on the conversation that began in Buenos Aires. We should seize that opportunity.
Moving on to LDC-specific issues, we need to continue working to implement the important decisions that were taken by members in Bali and Nairobi.
Let me say a word or two about each of these areas.
On duty-free and quota-free,we should acknowledge that the LDCs now enjoy comprehensive coverage in most developed countries, as well as in several developing country markets. Nevertheless there is clearly scope for further improvement.
The strong progress we saw after Hong Kong and after Bali has slowed.
To move this file forward, I think you will need to develop specific proposals especially on implementation of DFQF market access and engage directly with the relevant stakeholders.
On preferential rules of origin, we are making good progress. Last year, the Committee on Rules of Origin adopted a new template for the notification of preferential rules of origin. And almost all preference-granting members have already notified using this template.
The Committee has also started an examination of preference utilization rates.
This work will help members better understand to what extent LDC exporters make use of the preferences available, and identify possible areas for improvement.
In addition, a number of preference-granting members have informed the Committee on the measures that they are undertaking in order to simplify their rules of origin requirements. This is yet another positive sign.
Moving on to the LDC Services Waiver…
We have received 24 notifications from members with measures in favour of LDC services and service suppliers. I understand you have done some analysis on the content of these notifications and have also engaged with members.
It is important that we make progress on this file in order to support your services suppliers to make use of the opportunities provided.
In light of the experience gained so far, you could consider submitting specific recommendations in the Services Council on how you would like members to adopt measures that would support your services sector.
So that’s where we stand on the specific issues, but let me make a broader point.
We are here today to reflect on MC11, so I think we have to face up to the fact that there are deep divisions and frustrations among the membership. These concerns connect with issues of both substance and process.
For instance, everyone agrees that the Doha issues should be tackled – but some argue that no other issue should be discussed until that work is complete.
That may be a legitimate aspiration – but it inevitably leads us to an impasse:
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First because we know that we are nowhere near completion of the Doha work programme,
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and second because others (while still very interested in advancing the Doha issues) clearly also want to discuss other areas.
We saw this clearly in Buenos Aires, with the various joint statements by large and diverse groups of members covering:
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e-commerce
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investment facilitation,
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MSMEs, and
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women’s economic empowerment.
Although we must acknowledge that some do not support these initiatives, it is clear that they are gaining a lot of momentum. Many members have been engaging actively on these issues. Numerous open-ended meetings have been held this year, and numerous submissions have been tabled.
In every conversation I’ve had so far, proponents assured me that:
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these conversations are meant to complement, and not to replace or brush aside other multilateral efforts; and
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these initiatives will remain open to any delegation that wants to join in.
Finally, I want to mention another issue that has gained prominence in recent years – and that is LDC graduation.
A good number of LDCs are expected to graduate from LDC status in the near future. The international community puts a special emphasis on smooth transition so that there is no sudden disruption of support to the graduated LDCs.
I absolutely agree that graduating LDCs need special attention and that the graduation process needs to be well prepared.
I note that your ministers called for positive actions on graduation in their LDC Ministerial Declaration in Buenos Aires. I also noted the specific proposal that you have tabled in the context of the SCM Agreement.
I encourage you to continue engaging with members, and explain the challenges that can arise in the post-graduation period.
On behalf of the Secretariat, I can assure you that we are ready to help in any way we can. And let me stress that this applies to every issue I have raised here today. The Secretariat remains at your service.
It is my firm belief that our efforts in the WTO must translate into real trade gains for you.
I think you can see this in many elements of our work. For example, we continue to place a major emphasis on addressing the trade capacity needs of LDCs.
Just a couple of weeks ago, the EIF Global Forum on LDCs was held here at the WTO. The global development community was there, meeting with representatives from more than 40 LDCs.
We need to keep pushing on all of these fronts to boost LDC trade, and to help achieve the SDGs. This remains a personal priority for me – as well as a priority for the whole institution.
So I look forward to working with you in the coming weeks and months to advance all of this work.
But let me stress once again. We can’t achieve any of this without the platform of shared rules that the WTO provides. Without the WTO, we would be returning to a system of ‘might makes right’. And in such a situation we all know that the smallest economies would stand to lose the most. But we should also be aware that, should the system be compromised, even the mightiest WTO members will also be worse off.
So we must all fight to maintain and strengthen the WTO. Again, it is not perfect, but it’s the best we’ve got.
Thank you for listening.
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Trump Administration looks toward the future U.S.-African trade and investment relationship
Trade in goods between the United States and sub-Saharan Africa increased nearly six percent to $39 billion between 2015 and 2017, according to a report delivered to Congress on 29 June 2018 by the Office of the United States Trade Representative (USTR).
The report details the state of trade and investment between the United States and the countries meeting eligibility criteria under the African Growth and Opportunity Act (AGOA) for duty-free access to the U.S. market for more than 1,800 of their products.
The report examines developments in AGOA over the last two years. Forty countries are currently eligible for AGOA, including The Gambia and Eswatini (formerly Swaziland) countries that regained their AGOA beneficiary status as of January 1, 2018.
“With today’s report and next month’s AGOA Forum, the Trump Administration is continuing to build on AGOA’s success by strengthening bilateral trade relationships in sub-Saharan Africa with the goal of establishing a free trade agreement that could serve as a model for developing countries,” said U.S. Trade Representative Robert Lighthizer.
“By reducing barriers to trade, we create more opportunity, jobs, and wealth for workers in both the United States and Africa.”
In order to participate in AGOA, countries must establish or make continual progress toward establishing a market-based economy, the rule of law, political pluralism, and the right to due process. Additionally, countries must eliminate barriers to U.S. trade and investment, enact policies to reduce poverty, combat corruption, and protect human rights.
“By providing new market opportunities for African exports, AGOA has helped bolster African economic growth and alleviate poverty on the continent. Additionally, AGOA has helped create a more conducive environment for American investment and business interests as African markets continue to expand,” the USTR report states.
Fact Sheet: African Growth and Opportunity Act 2018 Biennial Report
What is AGOA?
Since its enactment in 2000, the African Growth and Opportunity Act (AGOA) has been at the core of U.S. economic policy and commercial engagement with Africa. AGOA provides eligible sub-Saharan African countries with duty-free access to the U.S. market for over 1,800 products, in addition to the more than 5,000 products that are eligible for duty-free access under the Generalized System of Preferences program.
To meet AGOA’s rigorous eligibility requirements, countries must establish or make continual progress toward establishing a market-based economy, the rule of law, political pluralism, and the right to due process. Additionally, countries must eliminate barriers to U.S. trade and investment, enact policies to reduce poverty, combat corruption and protect human rights.
By providing new market opportunities, AGOA has helped bolster economic growth, promoted economic and political reform, and improved U.S. economic relations in the region.
40 countries are eligible for AGOA benefits in 2018.
Find out more on AGOA.info.
Trade and Investment Statistics
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Total two-way goods trade between the United States and sub-Saharan Africa increased 5.8%, from $36.9 billion in 2015 to $39 billion in 2017
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Top U.S. goods exports to sub-Saharan Africa: machinery ($2.3 billion), vehicles ($1.6 billion), aircraft ($1.5 billion), mineral fuels ($1.4 billion), and electrical machinery ($864 million)
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Top U.S. export markets in the region: South Africa ($5 billion), Nigeria ($2.2 billion), Ghana ($886 million), Ethiopia ($873 million), and Angola ($810 million)
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Top U.S. imports from sub-Saharan Africa: oil ($11.2 billion), precious metals ($4.1 billion), cocoa ($1.2 billion), vehicles ($1.2 billion), and iron and steel ($950 million)
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Top sub-Saharan African suppliers to the United States were South Africa ($7.8 billion), Nigeria ($7.1 billion), Angola ($2.6 billion), Cote d’Ivoire ($1.2 billion), and Botswana ($772 million).
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U.S. investment in sub-Saharan Africa stood at $29 billion in 2016, the latest year available, down 23% compared to $37.5 billion in 2014. The three largest destinations for U.S. investment were Mauritius ($6.7 billion), South Africa ($5.1 billion) and Nigeria ($3.8 billion).
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Sub-Saharan Africa foreign direct investment in the U.S. stood at $4.2 billion in 2016, up 164% compared to $1.6 billion in 2014.
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Sixth Summit of the SACU Heads of State or Government: Communiqué
The Sixth Summit of Heads of States and Government of the Southern African Customs Union (Botswana, Lesotho, Namibia, South Africa and Eswatini, former Swaziland) took place on 29 June 2018 in Gaborone.
The Summit meets on an annual basis to discuss progress on the implementation of the agreed SACU Work Programme. This year’s Summit also considered the progress made thus far by the Two Ministerial Task Teams on Trade and Industry and Finance, which were established in 2017 to facilitate the review of the 2002 SACU Agreement.
Communiqué
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The Sixth Summit of the Heads of State or Government of the Member States of the Southern African Customs Union (SACU), was held on Friday, 29th June 2018 in Gaborone, Republic of Botswana.
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The Summit was chaired by His Excellency, Mr Mokgweetsi Eric Keabetswe Masisi, President of the Republic of Botswana, and was attended by His Majesty King Mswati III of the Kingdom of Eswatini, His Excellency Dr. Hage Gottfried Geingob, President of the Republic of Namibia, His Excellency Mr Matamela Cyril Ramaphosa, President of the Republic of South Africa, and the Right Honourable Dr. Thomas Motsoahae Thabane, Prime Minister of the Kingdom of Lesotho.
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The Summit reaffirmed the importance of the regional integration agenda that promotes economic integration, industrialisation and economic diversification of the SACU economies.
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The Summit considered the Progress Report from the Council of Ministers on the implementation of the Work Programme for the Ministerial Task Teams on Trade and Industry and on Finance, that was endorsed by the 5th SACU Summit on 23 June 2017.
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The Summit recalled that the Work Programme focuses on: (i) the review and development of a suitable architecture for tariff-setting, rebates, duty drawbacks and trade remedies; (ii) strengthening existing cooperation and collaboration on Trade Facilitation to improve border efficiencies; (iii) a review of the Revenue Sharing Formula and the long-term management of the Common Revenue Pool; (iv) addressing volatility in the revenue shares and exploring the feasibility of a financing mechanism for regional industrialisation; and (v) the development of public policy interventions to promote industrial development and value chains.
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The Summit noted with appreciation, that in accordance with the Schedule of Implementation of the Work Programme, the Task Teams have achieved substantial progress on the implementation of the focus areas. The Summit therefore commended the Council of Ministers for the progress made.
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The Summit further noted that the implementation of the Work Programme entails extensive national consultations to ensure an inclusive and comprehensive engagement with the relevant stakeholders. In this regard, the Council has agreed on the need to extend the completion date, by an additional twelve (12) months from December 2018.
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The Summit emphasised the importance of expediting the conclusion of the work, to ensure that the outcomes of the Work Programme are translated into tangible and concrete results for the economic development of the SACU economies.
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The Summit noted the developments and progress on the SACU Trade Agenda, covering the on-going trade negotiations in which SACU is involved. Furthermore, the Summit reaffirmed the strategic importance of the Tripartite Free Trade Agreement and the African Continental Free Trade Agreement to promote inter-Africa trade and development, in line with the Abuja Treaty.
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The Summit noted with concern the global developments on trade including the rise in unilateralism and reaffirmed the centrality of the rules – based multilateral trading system as embodied in the World Trade Organisation. Furthermore, the Summit reaffirmed the importance of development in the World Trade Organisation’s work programme with the view to promote inclusive growth.
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The Summit further considered and adopted its Rules of Procedure.
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The Summit resolved to meet after the September 2018 Meeting of the Council, for further engagement and provide the necessary strategic direction on the SACU Work Programme.
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The Summit supports the bid by the Kingdom of Eswatini to host the Secretariat of the African Continental Free Trade Area.
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The Summit noted that the Kingdom of Lesotho will assume the Chair of SACU, effective 15 July 2018 to 14 July 2019, taking over from the Republic of Botswana.
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The Heads of State or Government commended His Excellency Mr Mokgweetsi Eric Keabetswe Masisi, President of the Republic of Botswana, for the able leadership and guidance rendered during his term. In the same vein, the Heads of State or Government congratulated the Right Honourable Dr. Thomas Motsoahae Thabane, Prime Minister of the Kingdom of Lesotho, on assuming the Chair of SACU, from 15 July 2018.
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The Heads of State and Government expressed their appreciation to the Government and the people of the Republic of Botswana, for the warm hospitality extended, and for hosting a successful 6th Summit of the SACU Heads of State or Government.
Done at GICC, Gaborone, Botswana on Friday, 29 June 2018.
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tralac’s Daily News Selection
A reminder that the SACU Heads of State Summit took place today in Gaborone. SA’s President Ramaphosa will be accompanied by the Minister of Trade and Industry, Dr Rob Davies, and the Minister of Finance, Mr Nhlanhla Nene.
Final Inquiry report: pdf Australia’s trade and investment relationships with the countries of Africa (1.54 MB) (Parliament of Australia)
In its submission to the inquiry, the Department of Foreign Affairs and Trade provided information on trade between Australia and individual African economies. This data indicates that the goods trade with South Africa is, by a wide margin, Australia’s most valuable trade relationship with an African country. In 2016, Australia’s trade with South Africa was valued at over $2bn. As shown in Figure 1 below, Australia’s major merchandise exports to Africa, in 2016, were largely concentrated in the primary industries, with aluminium ores, wheat, coal, vegetables, meat and wool all featuring in the top 10 exports. Civil engineering equipment and parts, and specialised machinery, together formed 12% of merchandise exports to Africa.
The top five export destinations for Australian goods to Africa in 2016 were: South Africa (aluminium ores, coal, machinery and parts); Egypt (vegetables, wheat, wool); Mozambique (aluminium ores, wheat); Nigeria (wheat, edible products); Ghana (civil engineering equipment and parts, machinery and parts). As shown in Figure 2, Australia’s major merchandise imports from Africa, in 2016, were concentrated in crude petrol and passenger motor vehicles which accounted for 84% of imports. The top five goods import sources from Africa in 2016 were: South Africa (passenger motor vehicles, ores and concentrates); Gabon (crude petroleum); Algeria (crude petroleum); Rep of Congo (crude petroleum); Equatorial Guinea (Liquefied propane & butane).
Australian mining in Africa: Australia’s current commercial activity in Africa is strongly focused on the extractives sector. While reported figures vary, submissions to the inquiry have indicated that at least 170 Australian Stock Exchange-listed mining and other resource companies are operating in some 35 African countries, with the scale of exploration, extraction and processing involving current and potential investment estimated to be worth more than $40bn. Australian mining companies in Africa are active across a broad geographical area, in both the operation of mines and the exploration of future projects (see Figure 3 below).
Profiled recommendations: Recommendation 1: That the Australian Government continue to actively monitor the emerging Continental Free Trade Area with a view to best position Australia to take advantage of it when it comes into force and ensure that businesses and the public are kept informed of the benefits of this agreement. Recommendation 2: That Austrade actively monitor and promote non-extractive trade and investment opportunities in Africa to Australian businesses. Recommendation 5: That the Australian Government explore opportunities to increase the number of Australian ministerial and parliamentary visits to Africa. Recommendation 7: That the Australian Government give further consideration to supporting initiatives that strengthen the regulatory and governance landscape in Africa. Recommendation 8: That the Australian Government review its visa assessment process for African travellers with a view to minimising processing times, increasing transparency and to ensure there are no unintended barriers. Recommendation 10: That the Australian Government consult stakeholders such as the Australia-Africa Minerals and Energy Group on ways to improve data collection regarding Australian mining activity in Africa. Recommendation 13: That the Australian Government consider an Africa round for Business Partnerships Platform funding for African development projects delivered through public-private partnerships.
Ronak Gopaldas: The race to become Africa’s preferred gateway is heating up (ORF)
An intriguing contest is underway to emerge as the “gateway” to doing business in Africa. South Africa, the continent’s largest economy by GDP, is currently in pole position by virtue of the size, sophistication and connectivity of its economy to the rest of Africa and the globe. But in the past decade, a series of policy missteps, periodic bouts of xenophobia, a clumsy foreign policy as well as a marked deterioration in its business environment has seen the country lose significant ground to other nations. By contrast, Mauritius, Morocco, Kenya and even Dubai have intensified their efforts to be the preferred launch pads for businesses with a pan-African focus. As the race now hots up, who will emerge as the favourite for this prestigious title? We examine the strengths and weaknesses of each contender.
Aubrey Hruby: African nations are carrying the torch of free trade (The Hill)
The past decade has seen rapid economic growth across many African markets. The next decade will be defined by efforts to institutionalize the growth and ensure sustainability. A single African market of 1.2 billion people with a combined gross domestic product of more than $2 trillion will be a game changer for global trade and investment trends. As the US and China continue to toss tariffs at each other, African countries are deepening collaboration. They are now carrying the torch of free trade.
UNECA’s Dr Vera Songwe: As we work towards the AfCFTA, we must ensure that there is less transboundary corruption within Africa
Ethiopia-US: There are promising signs of economic change in Ethiopia. On 5 June, Ethiopia announced plans to partially privatize leading state-owned enterprises, including Ethiopian Airlines. EAL is the fastest growing and most profitable airline in Africa, registering an average growth of 25% in the past seven years. Following a meeting with Under Secretary Kaplan and the delegation, Ethiopian Airlines Group – parent company of EAL – Chief Executive Officer Tewolde Gebre Marian announced a deal with General Electric to procure 12 General Electric engines valued at $444m, as well as a separate $473.5m 10-year maintenance contract. Aviation is the top market in Ethiopia for US companies, and as of 2016 the export of aircraft and aircraft parts represents 54 of the principal U.S. merchandise exports to Ethiopia. [US delegation visits Ethiopian Airlines; US companies set to speed Ethiopia’s WTO accession]
Kenya-US: Kenya yesterday signed multi-billion shilling partnership agreements with the US government and companies – the majority of them targeting President Uhuru Kenyatta’s growth pillars commonly known as the ‘Big Four’. About 12 deals worth more than $100m (Sh10bn) were signed on the second day of the three-day official visit by 60 US business executives from the US Presidential Advisory Council on Doing Business in Africa. Most of the deals were negotiated during an economic summit that the American Chamber of Commerce held in Nairobi. Mr Kenyatta said Kenya was working to improve trade ties with her peers in the EAC to ensure that investors in the Big Four sectors have access to neighbouring countries such Tanzania, Uganda and Rwanda. The head of the US delegation, Under-Secretary for Commerce Gilbert Kaplan, said US investors were keen on East Africa’s roads, energy and financial services sectors with Nairobi as the hub. “Kenya is first on the list of our priority countries in Africa,” Mr Kaplan said.
African Standards Authorities: updates
(i) South Africa: Rob Davies dissolves SABS board. Trade and Industry Minister Rob Davies has decided to dissolve the board of the South African Bureau of Standards (SABS) with immediate effect and to place the entity under the control of administrators. His decision follows a deluge of complaints over the underperformance of SABS in conducting tests and issuing certificates for products. Davies said the board’s collective response to his concerns was unsatisfactory and indicated it did not understand its legislative mandate. The representations did not change his view of the board.
(ii) Kenya: KenInvest boss appointed acting Kebs MD to replace Charles Ongwae. Industry, Trade and Cooperatives Cabinet Secretary Adan Mohamed has appointed Kenya Investment Authority chief executive Moses Ikiara as acting managing director of the Kenya Bureau of Standards. In a letter dated June 26 addressed to Kebs chairman Mugambi Imanyara, Mr Ikiara has been appointed for a three-month period with immediate effect. The new appointment at the standards agency comes barely a few days after the arrest of Mr Ongwae and nine others senior officials over the importation of substandard fertiliser suspected to be laced with mercury and circulation of fake Kebs stamps. [Phyllis Wakiaga: War on counterfeits should not imperil legitimate business]
(iii) Tanzania meets deadline in sweets row with Kenya. Tanzania has met Nairobi’s deadline to visit Kenya confectionery, juice, ice cream and chewing gum factories to verify their source of sugar in the products after it restricted the entry of the goods to its market. Dar and Kampala slapped a 25% import duty on Kenyan confectionery, juice, ice cream and chewing gum earlier in the year, claiming use of zero-rated industrial sugar imports. Kenya threatened to retaliate against Tanzania made goods if Dar es Salam revenue and standards bodies failed to visit local factories by Sunday to verify their sugar sourcing. Tanzanian team arrived Monday and held talks with Kenya officials besides making the factory visits in a fresh attempt to resolve the trade spat.
BRICS Summit to push value-added trade (Financial Express)
According to media reports, South Africa is planning to reach out to other African nations for industrialisation and infrastructure development in the continent. Rwanda (chair of the AU), Namibia (incoming chair of SADC) and Togo (chair of ECOWAS) will take part. The head of NEPAD, the president of AfDB and chiefs of six regional executive committees have also been invited. Countries such as Argentina, Indonesia, Egypt and Turkey have also received invitation for the BRICS-plus Outreach. [BRICS Summit theme: BRICS in Africa – collaboration for inclusive growth and shared prosperity in the 4th Industrial Revolution]
Ghana: Statistical Service postpones rebasing of economy (GhanaWeb)
The Ghana Statistical Service has announced that it has rescheduled the rebasing of the economy to September this year. The service had earlier announced that it would complete the process of rebasing the economy by May 2018 after earlier postponements. Explaining the reasons behind the postponement, Acting Government Statistician Mr Baah Wadieh stated that the new date is to enable the service engage all stake holders before the exercise. “It is important that the figures are quality assured, so certain quality measures are being put in place.” [Ghana: About GH¢13bn accrues from mobile money monthly]
Rwanda launches Rwf2.7 trillion agriculture development strategy (New Times)
Rwanda has launched the fourth Agriculture Transformation Strategy (PST4) that is designed to significantly increase farm productivity and promote value addition to food. The five-year plan, which runs from 2018 until 2023, will cost Rw2.7 trillion, according to the Ministry of Agriculture and Animal Resources. The strategy has four priority areas; innovation and extension, productivity and resilience, inclusive markets and value addition as well as enabling environment and responsive institutions. The Prime Minister said that agriculture GDP grew at 6% on average in the concluded PSTA3, pointing out that in the PSTA4, the target is to achieve an average of 10% of the sector’s growth.
Ethiopia to begin extracting crude oil and natural gas (New Times)
Ethiopia will begin extracting crude oil on a test basis from reserves in the country’s southeast this week, state-affiliated media and the prime minister’s office said on Wednesday. Prime Minister Dr. Abiy Ahmed yesterday met with the representatives of Poly-GCL Petroleum Investment Limited to officially kick start crude oil production test in Ogaden Region. The company has discovered that there is a prospect of commercial quantities of crude oil in the region. The firm is a joint venture of state-owned China POLY Group Corporation and Hong Kong-based Golden Concord Group. The state-affiliated Fana media quoted Abiy as saying 450 barrels would be produced on Thursday on a trial basis.
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Australia’s trade and investment relationships with the countries of Africa: Inquiry report
On 13 June 2016, the Senate referred the following matter to the Senate Foreign Affairs, Defence and Trade References Committee for inquiry and report by 14 February 2018: Australia’s trade and investment relationships with the countries of Africa, with particular reference to:
(a) existing trade and investment relationships; (b) emerging and possible future trends; (c) barriers and impediments to trade and investment; (d) opportunities to expand trade and investment; (e) the role of government in identifying opportunities and assisting Australian companies to access existing and new markets; (f) the role of Australian based companies in sustainable development outcomes, and lessons that can be applied to other developing nations; (g) the role of Australian based companies in promoting the achievement of Sustainable Development Goals; and (h) any related matters.
On 27 November 2017 the Senate agreed to extend the reporting date to 27 April 2018. On 26 March 2018 the Senate agreed a further extension to 21 June 2018.
Overview of Australia’s existing trade and investment relationships with the countries of Africa
The continent of Africa, second only to Asia in both landmass and population, is diverse geographically, culturally, linguistically, and economically. Comprising 54 sovereign states, nine territories, and two de-facto independent states, Africa is home to over 1.2 billion people. This number is increasing sharply, however, with African nations boasting some of the youngest and most rapidly growing populations in the world.
Submissions emphasised the importance of recognising that Africa cannot be described or analysed as a single market but is comprised of discrete economies with separate opportunities.
In its submission to the inquiry, the Department of Foreign Affairs and Trade (DFAT) provided information on trade between Australia and individual African economies. This data indicates that the goods trade with South Africa is, by a wide margin, Australia’s most valuable trade relationship with an African country. In 2016, Australia’s trade with South Africa was valued at over $2 billion.
Australia also maintains trade relationships with several other African countries that, in 2016, were valued at over $100 million. These include Algeria, Egypt, Gabon, Ghana, Mauritius, Mozambique, Nigeria, and Republic of the Congo.
Australia’s major merchandise exports to Africa, in 2016, were largely concentrated in the primary industries, with aluminium ores, wheat, coal, vegetables, meat and wool all featuring in the top 10 exports. Civil engineering equipment and parts, and specialised machinery, together formed 12 per cent of merchandise exports to Africa.
The top five export destinations for Australian goods to Africa in 2016 were:
- South Africa: aluminium ores; coal; machinery and parts.
- Egypt: vegetables; wheat; wool.
- Mozambique: aluminium ores; wheat.
- Nigeria: wheat; edible products.
- Ghana: civil engineering equipment and parts; machinery and parts.
Australia’s major merchandise imports from Africa, in 2016, were concentrated in crude petrol and passenger motor vehicles which accounted for 84 per cent of imports. The top five goods import sources from Africa in 2016 were:
- South Africa: passenger motor vehicles, ores and concentrates.
- Gabon: crude petroleum.
- Algeria: crude petroleum.
- Republic of the Congo: crude petroleum.
- Equatorial Guinea: Liquefied propane & butane.
Barriers and impediments to trade and investment
The African context
The Department of Foreign Affairs and Trade (DFAT) noted in its submission that a range of factors attributed to African society, culture and systems of governance may form a barrier to Australian trade and investment. These factors, which DFAT has collectively termed the ‘African context,’ include:
Local conditions, including traditional leadership structures, land ownership, expectations around remuneration and the broader social responsibility of companies…
DFAT highlighted land ownership as a particular barrier, owing to intersecting systems of ownership at different levels of society: Land ownership in particular can be difficult to consolidate due to competing levels of government (national, state and local), traditional ownership claims, particularly where sites intersect lands of different groups, often with different ownership structures (patrilineal, matrilineal, collective and/or individual) all of which add complexity to large-scale mining, infrastructure and agriculture projects. As is the practice in other developing countries, local landowners may expect mining companies to build roads and schools as part of the company’s Corporate Social Responsibility, in addition to royalties and other land fees being paid to government.
DFAT’s submission also drew attention to the economic systems in place in many African countries as a barrier to trade and investment, noting that the historical factors that shaped these systems are often unlike those of Western countries: Many of the governments of Africa could be best described as taking a state centric, command economy approach to economic development. This can be seen as deriving both from a colonial heritage that utilised resources to enrich foreign elites and the Marxist ideologies of liberation movements with centralised social and economic planning approaches. Unlike the reforms of the last century which have seen a decreasing role for government in markets for liberal democracies, for most African nations the role of government remains central to economic development.
DFAT recommended that businesses draw on the experience of a local partner or consultant in order to navigate these challenges.
Governance and regulation
In its submission, DFAT noted that ‘uncertainty around regulatory regimes can have a chilling effect on potential Australian investment across all sectors’ and issues such as opaque and unfamiliar tendering practices can also deter Australian companies from bidding for government contracts and advantage competitors.
With particular reference to the extractive industry, Oxfam also noted the risks associated with a poorly regulated environment: Poorly regulated environments, as is often the case in natural resource governance, are also conducive to corruption which in turn forms an obstacle to legitimate business sectors developing. Community conflict as a result of unregulated, negative impacts of EI [extractives industry] companies, or a perceived lack of community benefits, can increase business risk as they may be subject to sudden business disruption. There are significant human rights risks in mining, including labour rights transgressions, impacts on women’s security and health, and the displacement of local people to make way for new mines.
To address these issues, Oxfam suggested:
The Australian government and EI companies should be investing in building regulatory capacity in the host country to improve the regulation of EI sectors, in order to increase investment certainty and a more enabling business environment.
Infrastructure
DFAT identified inadequate infrastructure as a barrier: Inadequate infrastructure adds to the cost of doing business in Africa, and has led to the failure of major mining projects in the past. Poor road and transport networks, intermittent power and inefficient ports are common challenges across Africa. Technical barriers to trade and underdeveloped logistics networks, such as onerous customs procedures and inefficient ports act much in the same way as poor transport in adding to costs.
Opportunities to expand trade and investment
Overview of opportunities
According to a recent paper from Future Directions International, most of the world’s population growth in the 21st century will occur in Africa. By 2050, it is estimated that the population of Africa will have more than doubled from its current 1.2 billion people to nearly 2.5 billion. This population growth is expected to be coupled with rapid urbanisation. The Future Directions paper anticipates that, by 2100, five of the world’s 10 largest cities will be on the African continent.
Africa also lays claim to the world’s youngest population, with more than 50 per cent of the population of Africa younger than 20 years old. Due to increased life expectancy and reduced infant mortality rates it is expected that Africa will have access to a young and plentiful workforce.
Regarding trade and integration, a Continental Free Trade Area is being established under the auspices of the African Union. Negotiations started at the beginning of 2017 and all 55 African Union members are involved. The Department of Foreign Affairs and Trade (DFAT) pointed out that ‘enhanced African economic integration with a common set of rules and procedures would assist Australian business that generally operate across borders and various African countries’.
There are specific areas where Australia is well placed with relevant expertise beyond mining capabilities. For example Windlab and Carnegie Clean Energy drew attention to the export potential of Australia renewable energy technology to meet a significant energy shortage in large areas of Africa. Carnegie Clean Energy drew particular attention to the potential for leveraging Australia’s mining capability to include power and water solutions.
Grame Barty and Associates also highlighted opportunities for Australian business:
…particularly in the areas of infrastructure, resources and energy, food and agribusiness, international health, advanced manufacturing, technology and services.
DFAT indicated that Australian trade and investment in Africa has recently seen growth in non-extractive sectors in some regions: Traditionally, most Australian investment in Africa has centred on the mining, oil and gas industries. More recently, we have seen investment in the infrastructure and construction industries, as well as telecommunications, agriculture and retail, financial and banking sectors. Expanded trade and investment links are expected for Australian companies operating out of Morocco, servicing North Africa in food and agriculture; infrastructure planning and sustainable development; mining, oil and gas; and health services.
However, in its submission, DFAT noted that recent DFAT and Austrade analysis indicates:
…the most realistic and immediate commercial opportunities for Australian companies in Africa are in mining and related equipment, technology and services; education; agribusiness and food and infrastructure.
The Export Council of Australia stated that ‘Africa is a natural destination for all the products and services related to mining and agriculture in particular’. Other areas of expertise include: infrastructure and construction and related services, financial and professional services, tourism, education, and advanced manufacturing. The top ten growth sectors in Africa are: resources, wholesale and retail, agriculture, transport and communications, manufacturing, financial services, public administration, construction, real estate and business services, and tourism.
Broadening commercial interests
As noted above, with Australian companies well established in the extractive industries, submissions highlighted the need for Australia to broaden commercial interests beyond the mining industry. This was recognised by the Minister for Foreign Affairs, the Hon. Julie Bishop MP in her speech at the Africa Down Under Conference in Perth on 8 September 2017. The Minister emphasised the broadening of Australia’s commercial interests from the already strong base in extractives and mining services, infrastructure and energy into retail and professional services. The Minister stated that ‘[t]he opportunity for mutual growth in our economic partnerships in these and other sectors is enormous’.
Emerging free trade area
Her Excellency Ms Christelle Sohun, High Commissioner of Mauritius, informed the committee that:
A few weeks ago, on 21 March 2018 in Kigali, Rwanda, an agreement was reached for the establishment of an African Continental Free Trade Area. This will create a single African market for the elimination of barriers to trade in goods and services – one billion people and a total GDP of over US$3 trillion, practically on your doorstep. Australia can now engage constructively with African countries to seize the numerous untapped trade and investment opportunities available in Africa.
High Commissioner Sohun added that it was signed by 44 countries. DFAT provided further detail that what was signed on 21 March 2018 was the framework to establish the Continental Free Trade Area which then would need to be ratified by 22 countries before coming into effect and this may take some time:
My expectation is that if the negotiations are completed and the ratification process happens, which could be many years in the making…
However, DFAT welcomed this as a very positive development with the potential to create one of the largest free trade areas in the world which would present opportunities for foreign companies and investors. The agreement has the potential to allow Australian companies with a presence in one African market broader access to new markets on the African continent without the burden of existing trade barriers such as tariffs.
Conclusions and recommendations
While the terms of reference for this inquiry cover Africa in its totality, at the outset, the committee wishes to recognise the key point that Africa is a continent and not a country. Its countries have a great deal of diversity in geography, history, culture, economic capacity and markets.
The African continent is in the midst of significant economic, technological and population growth and this inquiry has provided the opportunity to revisit current settings to ensure that Australia is in the best possible position to take advantage of these changes for trade and investment and contribute skills to facilitate this development.
While noting the already well-developed relationships in the mining industry, demographic, economic and technological changes will provide other opportunities for expansion of the relationship with Africa.
Australia is well-positioned to use its expertise in a range of sectors to contribute to development outcomes in many African countries. Our knowledge and skills in area such as agriculture, the mining sector, education, and technology are highly regarded, and this knowledge will be in high demand in a growing and developing Africa.
The committee notes that overall it will be important for the Australian Government to ensure Australian businesses have broad access to African markets, and that a strong mutual understanding of the importance of the Australia-Africa relationship is cultivated on both sides. Business and trade Emerging free trade area.
Summary of Recommendations
Recommendation 1
The committee recommends that the Australian Government continue to actively monitor the emerging Continental Free Trade Area with a view to best position Australia to take advantage of it when it comes into force and ensure that businesses and the public are kept informed of the benefits of this agreement.
Recommendation 2
The committee recommends that Austrade actively monitor and promote non-extractive trade and investment opportunities in Africa to Australian businesses.
Recommendation 3
The committee recommends that the Department of Foreign Affairs and Trade work with organisers of major promotional events and conferences, such as Australia-Africa Week, to facilitate greater participation of the private sector from industries other than mining.
Recommendation 4
The committee recommends that the Department of Foreign Affairs and Trade review Australia’s diplomatic representation in Africa with a view to applying new methods of operation.
Recommendation 5
The committee recommends that the Australian Government explore opportunities to increase the number of Australian ministerial and parliamentary visits to Africa.
Recommendation 6
The committee recommends that, in relation to the Advisory Group on Australia-Africa Relations (AGAAR):
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the Department of Foreign Affairs and Trade and AGAAR, engaging in appropriate consultation with stakeholders, review AGAAR’s role with a view to build on its advisory responsibilities to include a more outward facing function to strengthen the Australia-Africa relationship;
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detail about the work and achievements of AGAAR be included on the AGAAR website; and
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the Department of Foreign Affairs and Trade include a response to the recommendations contained in the AGAAR strategy paper on its website.
Recommendation 7
The committee recommends that the Australian Government give further consideration to supporting initiatives that strengthen the regulatory and governance landscape in Africa.
Recommendation 8
The committee recommends that the Australian Government review its visa assessment process for African travellers with a view to minimising processing times, increasing transparency and to ensure there are no unintended barriers.
Recommendation 9
The committee recommends the Department of Foreign Affairs and Trade review their Smartraveller advice platform with a view to providing more tailored and specific advice to Australian businesses operating on the African continent.
Recommendation 10
The committee recommends that the Australian Government consult stakeholders such as the Australia-Africa Minerals and Energy Group on ways to improve data collection regarding Australian mining activity in Africa.
Recommendation 11
The committee recommends that the Australian Government, in consultation with a range of stakeholders, explore options for improving Africa literacy, awareness, engagement, access to information and research.
Recommendation 12
The committee recommends that the Australian Government consider increasing Australian Centre for International Agricultural Research’s funding in order to increase research, project and partnership activity in Africa.
Recommendation 13
The committee recommends that the Australian Government consider an Africa round for Business Partnerships Platform funding for African development projects delivered through public-private partnerships.
Recommendation 14
The committee recommends the Department of Foreign Affairs and Trade undertake a review of Australian mining and Mining, Equipment, Technology and Services (METS) companies operating on the African continent which undertake engagement and provide services or assistance to the communities in which they operate.
Recommendation 15
The committee recommends that the Department of Industry, Innovation and Science review its Leading Practice Sustainable Development Program for the Mining Industry to ensure it is up-to-date and incorporates information on the UN Sustainable Development Goals.
Recommendation 16
The committee recommends that the Australian Government seek to increase the visibility of the Australia Global Alumni program among African alumni in order to formalise alumni networks.
Recommendation 17
The committee recommends that the Australian Government review its list of Australia Global Alumni ambassadors with a view to including an Ambassador from Africa.
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BRICS in Africa: Working towards the realisation of the African aspirations
Speech by Deputy Minister of International Relations and Cooperation, Ms Reginah Mhaule, during the BRICS Stakeholder Engagement held on 27 June 2018 in partnership with the Institute for Global Dialogue (IGD) as part of build-up events to the 10th BRICS Summit
It is an honour for me to be afforded this opportunity to engage with you on this occasion of South Africa’s membership of the BRICS formation. South Africa will be hosting the BRICS Summit in July 2018, at the time this formation marks its 20 year anniversary which coincides with the commemoration of the centenary of Nelson Mandela who would have turned 100 this year had he lived longer. I would not leave out the fact that we also commemorate the centenary of another icon of the South African liberation struggle Mama Albertina Sisulu.
Both Tata Madiba and Mama Sisulu have contributed immensely on laying the foundation of an independent and democratic foreign policy which we continue to implement.
As we have heard about the BRICS formation and our country’s membership to it, Brazil, Russia, India, China and South Africa represents one of the most significant developments in global government and this is a bloc that brings together sufficiently great members of emerging powers that are designed to take significant international decision and in the negotiations of major global affairs.
Allow me to contextualise the South Africa’s membership of the BRICS formation for the benefit of all our stakeholders by quoting our Leader Nelson Mandela’s words at the world economic forum Southern Africa summit in 1994, when he said “this is our collective achievement which has opened up new opportunities for us to exploit our great potential and indeed to boldly cross the threshold of a new and great era.”
The formation of BRICS by the emerging powers has attracted significant academic interest which resulted into a significant growth in literature on the subject.
BRICS represents 43 percent of the world’s population and that triggered academic interest in understanding the political, economic, social, scientific and technological importance of the figuration of the world power, both its potentials and its weaknesses.
As a result different BRICS forums were established such as the academic forum, business forum, the young diplomatic forum and others.
Former President Mandela, in his capacity as our Head of State and Government, championed the strengthening of regional and international economic cooperation to ensure that we leverage the existing and new opportunities while adhering to our international obligations. In 2011 when our Country was invited to join the then BRIC formation, South Africa favourably considered the invite because it is in line with the vision of our forefathers, which is the strengthening of international economic cooperation for mutual benefit as already stated above.
South Africa is not in the BRICS for its own sake, and perhaps for selfish consideration only, but is there to advance the interest and aspirations of Africa, the Global South and humanity at large.
I must also take this opportunity to briefly reflect on the genesis of our solidarity with countries of the South so that we can properly locate the BRICS formation in this regard. 63 years ago, in April 1955, countries of Asia and Africa met at the historic Bandung Conference to determine their common position amid the fast emerging Cold War bi-polarisation.
South Africa was represented, among others, by none other than Moses Kotane and Maulvi Cachalia. This is where the present day Non-Aligned Movement (NAM) was conceived.
I hope that this brief background will enhance our collective comprehension of the locus of BRICS in South Africa’s foreign policy. I know that in some quotas our membership of the BRICS formation was and continues to be deliberately misrepresented as a negation of our relations with the development partners of the North. It is wrongly perceived as a deviation from our founding foreign policy principle. We have stated so many times that this formation must be regarded as a complimentary mechanism and is based on our founding principles and foreign policy pillars
I must therefore urge everybody to work hard so that this formation is construed truly for what it stands for.
Of course the BRICS formation was bound to tilt the balances of forces at global level considering that we, among others, collectively produce a third of the world’s industrial products and one half of agricultural goods. During its infantry stages, researches estimated that the BRICS will dominate the world by 2050, however the revised projections indicates that this could happen as early as 2027.
Distractors of the BRICS thought and communicated that this would be another talk show with no tangible deliverables. We can however agree that it is a force to be reckoned with in the international arena and has contributed to increased dispersal of global political and economic power. I must state that the progress that has been recorded thus far is due to our collective commitment to see through the implementation of all our decisions which are always based on consensus.
Brand SA in its recent Research Report titled: “The BRICS brand: from economic concept to institution of global governance”, indicates that between the years 2009 and 2017 BRICS Summits made a total of 406 summit declarations. Brand SA further informs us that 70% of summit decisions have been implemented to date.
They further indicate that, in an effort to deepen and widen cooperation and collaboration, the BRICS formation has convened approximately 160 meetings at different levels, convened by Ministers of trade, finance, foreign affairs, health, agriculture, statistical authorities, and competition commissions which led to the adoption of 60 documents which in turn is giving effect to working groups, contact groups and related platforms to coordinate activities.
I urge you to read this entire report because it is an important yard stick to measure the success of the BRICS formation of which we are proud of.
We therefore seek to build on the already recorded achievement and ensure that our chair ship increases support for Africa’s development Agenda. We have an opportunity to leverage on the tectonic shift in global power dynamics and reassert ourselves as a united and renewed continent. This is what we are as the continent!!!
We are going to have a dedicated discussion during the Africa-Outreach meeting of selected Heads of State and government in the margins of the July Summit. I can assure you that building on the Durban 2013 out-reach approach, the 2018 Summit will produce practical steps to continue the BRICS support for the implementation of the African Union’s Agenda 2063 through the BRICS.
This comes at a time when the continent has made great strides in pursuit of economically integrated Africa which promotes the movement of goods and services. As you may be aware the Continental Free Trade Agreement (CFTA) was signed in Rwanda in March this year and we continue with our national processes which will culminate in the country’s accession to the agreement.
President Ramaphosa underscored the importance of an integrated African economy during the Japan-Africa Public-Private Economic Forum when he said:
“For Africa to grow and for its people to flourish, its economies need to be more effectively integrated into the global economy.”
In this way we will be able to improve Intra-Africa trade and leverage more on the alternative funding that the BRICS New Development Bank provides for infrastructure development and sustainable development. The continent is already benefiting in this regard, particularly, in implementing the BRICS funded African Union (AU) North-South Development Corridor projects.
On our part we benefitted from the 2016 approved BRICS project funding when we were granted 180 million USD for renewable energy which helped us to stabilise our electricity grid during difficult times in this area. We have just been granted an additional loan of USD 200 million by the NDB in May 2018 for expansion of the Durban port. I must confess that for a newly established multilateral bank by developing nations to have disbursed loans totalling USD 5.1 billion by 2018 not be expected by many who expressed doubt during the establishment of the Bank.
I also wish to reflect briefly on the concept of the BRICS Plus which was innovated by China in 2017. We wish to continue with this approach to ensure maximum synergy between our Chairship of BRICS and that of China. In this regard, South Africa has elected to invite the Leaders of the following countries representing Regional Economic Communities in the Global South and the United Nations namely:
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Argentina – as Chair of the G20 and influential Common Market of the South (MERCOSUR) member
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Indonesia – as Co-Chair of the New Africa-Asia Strategic Partnership with South Africa and influential Association of Southeast Asian Nations (ASEAN) member
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Egypt – as Chair of the Group of 77 (G77) +China
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Jamaica – as incoming Chair of the Caribbean Community (CARICOM)
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Turkey – as Chair of the Organisation of Islamic Cooperation (OIC)
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United Nations (UN) Secretary-General, Mr Antonio Guterres
Together with my colleagues we have continued to highlight this approach to all our stakeholders and also inform them about the following newly identified areas of cooperation:
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Establishment of a Working Group on Peacekeeping;
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Establishment of a Vaccine Research Centre for Collaboration with BRICS vaccine innovation and development partners – this is intended to be a physical research centre focused on research and development and vaccine innovation;
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Establishment of a BRICS Gender and Women’s Forum – intended as a dedicated track for gender and women’s issues, given the economic benefit to be derived from the socio-economic empowerment of women, particularly in developing countries;
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Leveraging the Strategy for BRICS Economic Partnership towards the pursuit of Inclusive Growth and Advancing the 4th Industrial Revolution – this is intended to foster discussions to addresses opportunities provided by the Fourth Industrial Revolution, as a means of leapfrogging development stages and bridging the digital divide; and
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Establishment of a BRICS Tourism Track of Cooperation.
South Africa’s approach to its Chairship is grounded in the intention to ensure programmatic continuity for BRICS, and committed to executing approximately 100 sectorial meetings, reflective of the expanded BRICS architecture. We also intend to bring a specific focus to the challenges and opportunities presented by the 4th Industrial Revolution.
It is my considered view that through this lecture we have a solid foundation for debating various elements of South Africa’s membership of the BRICS. Am also certain that we will do so with a view to improve in areas that require such improvement but also ensure common and collective improved comprehension of the subject matter.
We must always remember the world we operate in and remain alive to the challenges we are facing as a continent, the Global South and humanity at large.
I thank you!
As we work towards the AfCFTA, we must ensure that there is less transboundary corruption within Africa
In a speech to the 33rd Session of the Executive Council of Ministers of Foreign Affairs of the African Union in Nouakchott, Mauritania, ECA’s Executive Secretary Vera Songwe warned against the impact of corruption on Africa’s development.
“We need to be aware that Africa will not be able to seize the transformation opportunities highlighted by regional and global development frameworks if this problem persists,” Ms Songwe said, explaining that although it is difficult to measure precisely the cost of corruption, recent estimates place it at $1500 to 2000 billion a year, i.e. 2% of the world’s GDP.
Experts fear that corruption could be having even higher costs at the less visible social level and on women: “Corruption in public services also affects the quality of social services. In the poorest countries, half of the people pay bribes to access basic services such as education, health or water,” she regretted.
In Africa, public expenses, women’s rights, the energy sector and intellectual property rights are among the areas suffering from the most worrying consequences.
“Corruption affects more than 60% of public procurement in Africa and increases the cost of contracts by 20 to 30%. In a world characterized by limited resources, this is an unfortunate cost for investments that are greatly needed. We cannot afford such losses anymore,” she added.
In addition to corruption within countries, there is also a growing need to take into account corruption between countries and regions. According to an ECA’s report, pdf Measuring corruption in Africa: the international dimension matters (1.65 MB) , there have been at least 1080 cases of transboundary corruption in Africa between 1995 and 2014, 99.5% of which involved non-African companies and were mostly related to fiscal evasion issues.
“As we work towards the African Continental Free Trade Area (AfCFTA), we must ensure that there is less transboundary corruption within Africa,” Ms Songwe added, hoping that “by the time we get to Agenda 2030 and certainly Agenda 2063, corruption will no longer be Africa’s cancer”.
ECA’s Executive Secretary Vera Songwe is currently taking part in the African Union’s 31st Summit in Nouakchott. This event will be taking place on 25 June to 2 July under the theme “Winning the Fight against Corruption: A Sustainable Path to Africa’s Transformation”.
On 30 June in Nouakchott, Ms Songwe launched the #HonestService Public Service Delivery Campaign, which aims to put forward public and service workers who conduct themselves in a fair, honest and upfront manner in their interactions with customers and citizens, to provide an alternative approach to the corruption narrative on Africa.
The campaign, which will involve young people across the Continent, will gather information emanating from a positive discussion that encourages average African citizens, who engage with public services on a daily basis, to put forward exemplary public service they encounter in their quest for healthcare, education, employment opportunities and many other dimensions of their lives.
“The widespread narrative about corruption in African public services has inadvertently failed to acknowledge performant public servants who, on the contrary, have been serving their countries with integrity, upholding the public service ethics of fairness, equity and integrity, and have avoided falling into the corruption trap,” said Ms Songwe in the lead up to the launch.
“Such individuals are however, critical in making Africa work and in turning the wheels of Africa’s progress,” she added.
Estimates indicate that in 2015, up to 22 per cent of the population in Africa who interacted with a public service had to pay a bribe, mostly to the police and the courts.
With public service being one of the most active and visible connecting links between the State and the people, widespread corruption could have a significant public impact on governments’ perception.
The campaign is social-media driven and will last six months from July to December 2018. Present at the launch were Lilia Hachem Naas, Director of the ECA Office for North Africa; Adam El Hiraika, Director of the ECA Macroeconomic Division; Sid’Ahmed Bouh, Advisor to the Minister of Finance of the Islamic Republic of Mauritania; and Sidi Mohamed Ould Mohamed El Mamy, Deputy Secretary General of the Chamber of Commerce, Industry and Agriculture of Mauritania.
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tralac’s Daily News Selection
The AfDB’s Vice-Presidency for Economic Governance and Knowledge Management has posted a series of new Working Papers and Economic Briefs: we profile analyses by Dr Arkebe Oqubay (Minister and Special Advisor to the Prime Minister of Ethiopia, Dr Abiy Ahmed)
(i) Arkebe Oqubay: The structure and performance of the Ethiopian manufacturing sector. This paper is organised in five sections (pdf). The first section reviews the slow pace of manufacturing growth and patterns of industrial development in Ethiopia. The second section examines the structure of the Ethiopian manufacturing sector with a particular focus on firms’ dynamics (growth of firms, firm size and ownership, agglomeration patterns, linkages, and manufactured value added and output). The third section explores the ‘paradox’ of slow industrial development, the intensifying structural constraints on Ethiopia’s structural transformation in recent years, and the key global structural pressures. The fourth section highlights the government’s recent policy responses to improve the performance of the manufacturing sector. There are now clear signs of dynamism in the manufacturing sector, which gives hope for the possibility of late industrialization in the early 21st century Ethiopia. The final section summarizes some of the key challenges and their policy implications.
(ii) Arkebe Oqubay: Industrial policy and late industrialisation in Ethiopia. Conclusion: Late development and learning to catch up (pdf). Critics have suggested that there is no such thing as Ethiopian industrialization. This paper has acknowledged the profound shortcomings of the industrial policy and its outcomes thus far. But it has also shown that there have been clearly designed policy interventions, which have had non-negligible effects. Industrial policy in Ethiopia is not a mirage. It draws on a longer term historical experience of policy experiments and manufacturing activity since the time of the Italian occupation in the 1930s. It has since the 1990s and especially after 2003 achieved more than was achieved in the past. Policymakers have engaged with the shifting pressures of the global economy to produce some remarkable results, though overall the strategy remains a work in progress and the jury is still out on outcomes.
The paper also presents an alternative to the dominant perspective in mainstream development economics, which often denies sectoral considerations and suggests that industrial ambitions are beyond the reach of African countries. Instead, mainstream development economists argue that African countries should limit themselves to existing ‘latent comparative advantages’, and that the state should be ‘facilitative’ and confine itself to periodically addressing ‘market failures,’ rather than playing an active developmental role to create and shape markets. Finally, much of the literature on industrial policy fails to link it with the learning that is central to late industrialization. The evidence in this paper shows how policy learning has evolved in Ethiopia, reinforced not only by policy independence, but also by learning by doing and emulation. [Note: Dr Oqubay holds a PhD in development studies from SOAS, University of London, and is a research associate at the Centre of African Studies in the University of London]
Other featured papers
Chuku Chuku: Regional financial integration and economic activity in Africa. Our aim in this brief is two-fold (pdf): first, to determine the degree and timing of financial integration in selected sub-Saharan African stock markets using an unobserved latent variable; and second, to understand the effect of regional financial integration on economic activity in Africa. Perhaps the pertinent question is: why should markets, especially those in Africa, be regionally integrated?
Justin Yifu Lin: Industrialization – lessons from China for North Africa. An important reason for China’s success is that it did not follow the Washington consensus. Instead of shock therapy, China adopted a pragmatic, dual-track approach. On the one hand, it provided continuously transitory protection and subsidies to large scale, capital-intensive state owned enterprises, which violated China’s comparative advantages but were essential for national defence and people’s basic needs. On the other, it liberalized private and foreign firms’ entry to China’s comparative advantage industries, with the state facilitating the industries to become the nation’s competitive advantages in domestic and international markets by overcoming bottlenecks in hard and soft infrastructure.
Southern African Regional Integration Stakeholder Forum outcome statement: participants proffered 14 recommendations (UNECA)
Highlighted recommendations (pdf): The private sector should be involved in the design, formulation, implementation, and monitoring of regional protocols, strategies and programmes on industrialization, regional value chains, cross-border trade, private sector development and issues of trade negotiation; Governments should have a long-term term view regarding costs and benefits of regional and continental agreements and protocols, rather than focusing on short term revenue gains; Governments and the RECs should ensure greater efficiency and smoothness at border posts for easy and timely passage of trucks and other economic related movements. This should include speedy clearance of goods through the use of technology, ensuring uniformity of rules between countries, providing adequately skilled human resources, as well as facilitating cross-border movement of persons; There is need for greater support for the informal cross border traders, particularly women traders in building their capacities in terms of understanding of policies, protocols and procedures regarding cross border trade, access to information on their rights, and access to facilities such storage, finance and general services;
AUC Deputy Chairperson Kwesi Quartey: speech to opening of Permanent Representatives Committee (AU)
The centrality of the role of the PRC in the architecture of the various organs of the AU imposes on you, important obligations, as the interface between the Member States and the Commission to ensure, through quality information, convergence of views between the latter and the Commission in the best interests of the alignment and coherence of our actions. in this regard it is important to stress the need for interaction with the Commission within a balanced relationship, as the best means of pursuing the objectives set out in the Agenda 2063 calmly and effectively. Therefore, we respectfully call for the 2019 budget to be examined in the light of two imperatives: accelerating the implementation of flagship continental-scale programs as vehicles for integration and substantially reducing the reliance of the African Union on funds of external partners.
Martin Kingston: How to rebuild trust and integrity in South Africa (WEF)
It is imperative that South Africa rehabilitate its reputation, and return to the values espoused by Mandela and the founding fathers of the ANC. Business and institutions need to work together to rebuild trust and integrity in the country’s economic and political systems. To achieve those objectives, the following five steps must be taken. They will form a credible and sustainable approach to rooting out pervasive corruption, and instilling a culture that confers legitimacy on society and its key stakeholders. (4) Understand that business leadership is critical for driving collective action. The private sector can spearhead the development of innovative networks for public-private cooperation to discuss and address anti-corruption in constructive and open dialogue. (5) Enhance the uptake of technology and its application across stakeholders to reduce the opportunities for corruption. Big data, blockchain, artificial intelligence and e-governance systems are valuable tools in the prevention, detection, investigation and prosecution of corrupt practices.
Morocco systematic country diagnostic: governing towards efficiency, equity, education and endurance (World Bank)
Extract: Economic sustainability (2.1) (pdf): Morocco’s growth model is showing signs of running out of steam. It risks quickly finding itself having to contend with the limitations of growth based on fixed capital accumulation. Despite positive demographics, the labor factor has contributed little to the recent growth trend. Morocco has one of the lowest labor force participation rates in the world with less than one in two Moroccans employed or seeking work. Growth is heavily penalized by the economy’s difficulty in managing available human resources (including labor market policies that constrain recruitment and retrenchment across both public and private sectors), leveraging its human capital (especially young people and women), and swiftly reallocating labor across sectors for efficiency purposes. Unlike the labor factor, capital accumulation has made a large contribution to growth, mainly owing to one of the highest investment efforts in the world in the last decade (Figure 2.1). The rate of investment rose from 25% in 2000 to an average of 32% in recent years. It now stands at the rate observed in the “economic miracle” countries.
To increase its economic sustainability and lessen its reliance on debt-creating domestic demand, Morocco also needs to diversify its economy toward more export-oriented sectors. While export competitiveness is determined by a large array of factors from cost of labor to monetary policy, Morocco could take some specific actions to improve it. For instance, increasing its efforts to promote innovation would help expand the potential of high value activities that would move from a logic of technology consumers to a logic of developer. Given the uncertainties in the regional and international environment, Morocco cannot solely rely on foreign demand from its traditional markets in Europe and must open up to new markets. In that regard, the openness to Sub-Saharan Africa is promising for both Morocco’s and Africa’s growth and development prospects—especially in light of Morocco’s recent readmission in the AU and its bid to join ECOWAS. All things considered, Morocco will essentially have to continue relying on its own strengths to create the conditions for steadier foreign demand, by continuing its strategy of diversifying target markets and promoting exports.
Major US firms executives in Kenya for trade talks (The Standard)
American firms are in the country shopping for deals with Kenyan companies ahead of direct flights to the US that are planned to commence October this year. The more than 60 executives drawn from major US firms are accompanying the Undersecretary for International Trade and Commerce Gilbert Kaplan on a three-day tour. They will be looking out for opportunities, including partnerships with local firms.
Total Official Support for Sustainable Development measurement framework: update on the Nigeria pilot (pdf, OECD)
Nigeria represented an ideal candidate for hosting a TOSSD pilot. The country is a very active member of the TOSSD Task Force. It attracts substantial amounts of concessional and non-concessional finance and a recent OECD survey has shown that Nigeria is ranked the second largest receiver in the world of private finance mobilised through official development interventions. Nigeria also has long-standing experience in providing development co-operation programmes to other partner countries, including through its full-fledged Directorate of Technical Aid Corps. The first of the six pilots was carried out from 30 April to 11 May 2018 in Abuja. The three main objectives of the proposed pilot study were to: (i) Refine and test the statistical methodology of TOSSD to establish sound eligibility criteria (e.g. link with the SDGs) and measurement boundaries (e.g. extent of coverage of short-term trade finance); (ii) Provide estimates of TOSSD flows to Nigeria; (iii) Carry out a light assessment of the capacity of Nigeria to access, collate, analyse and use data on external official finance in support of sustainable development. Preliminary highlights of the pilot are as follows:
All hands on deck: reducing stunting through multisectoral efforts in Sub-Saharan Africa (World Bank)
As part of the effort to understand the underlying multisectoral nature of improving nutrition outcomes in sub-Saharan Africa, stylized country specific analyses were carried out for the 33 countries in the study. The methodology used for the regional study was applied at the country level, and the results are offered as a starting point for understanding and evaluating the multisectoral dimensions of nutrition in specific country contexts. Extract: The negative outcomes later in life are numerous, and some can even be quantified in economic terms. Recent World Bank estimates suggest that the per capita income penalty a country incurs for not having eliminated stunting when today’s workers were children is around 7% of GDP per capita, on average. In Sub-Saharan Africa and South Asia, these figures rise to about 9-10% of GDP per capita. [Note: Chapter 6 of Volume 1 provides an example applying the same methodology based on data from only one country, Tanzania]
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Southern African Regional Integration Stakeholder Forum: Outcome statement
Private Sector and Regional Integration in Southern Africa: Accelerating Opportunities for Investments and Growth
The Southern Africa Regional Integration Stakeholder Forum was co-organised by the United Nations Economic Commission for Africa, Southern Africa Office (UNECA-SA), the African Union Southern Africa Regional Office (AU-SARO) and the Africa Business Group (ABG) at Sunbird Capital Hotel, Lilongwe, Malawi, on 11-13 June 2018.
The objective of the Forum was to provide a comprehensive, integrated and inclusive platform for intense policy and program development focused dialogue among a broad range of constituencies from the private sector, RECs, member States’ governments, financial institutions and development partners, to discuss the implementation of strategies for harnessing the potential of the private sector in the acceleration of regional integration, and specifically regional market development, in Southern Africa. The essence is on how the private sector can be the driver and major beneficiary of the regional integration process in Southern Africa through increased opportunities for investments, profits, and growth in the region.
Key observations
After presentations of the main reports, the Stakeholder Forum, participants:
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acknowledged the progress made at the regional and continental levels in creating frameworks, policies and strategies to promote regional integration, industrialization, regional value chains and economic development in Southern Africa and the Continent, however, the issues of domestication, implementation and monitoring progress remain key;
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noted that the private sector needs to be more engaging and drive the regional integration process with its attendant benefits for the private sector in creating better opportunities for investments, profits, and the growth of the private sector;
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observed that the private sector should be better involved in the design and policy making processes on regional integration, industrialization, and economic development including on trade negotiations in the region and the Continent;
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argued that small and medium scale enterprises are still largely in the fringes in taking opportunity provided by expanded markets through the regional integration process. The main beneficiaries remain the big firms mostly concentrated in the trade, communication and service industries; and therefore, the need remains to devise appropriate strategies to mainstream MSMEs into the regional integration process and reaping its benefits;
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noted that information flow remains key for the private sector in tapping into opportunities provided by expanded markets and investment potentials in the region. These include adequate and available information on private sector organisations in the region in encouraging joint investments, and regional value chains, the details of the various protocols, and strategies as they affect and benefit the private sector, and how business flows can be eased in the region;
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highlighted the inefficiencies at border posts, including the slow pace of clearance of goods, the absence of prerequisite technology, lack of uniformity of rules between and among countries, lack of unified regional insurance arrangements, and inadequately skilled human resources;
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noted that informal cross border traders, particularly women traders, were poorly capacitated in terms of understanding of policies, protocols and procedures guiding cross border trade, have no access to information about their rights, and face a critical shortage of facilities such as for storage and other general services;
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noted that indigenisation policies could serve the purpose of promoting local economic empowerment of citizens; however, such policies require consideration for quality, standard, merit, efficiency and productivity;
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welcomed the AfCFTA Country Business Index currently under development by ECA, as it will help member States to monitor progress on the implementation of the AfCFTA; in this regard, they argued that establishing a baseline would facilitate the monitoring process;
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noted the lack of data on MSMEs particularly in a disaggregated form that would make it easy to monitor progress on gender representation, youth involvement and informal economic activities;
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expressed their concerns that the fragmented nature of private sector associations is weakening their ability to speak with one voice on matters concerning private businesses they represent;
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agreed that it is the responsibility of both the Governments and the private sector to devise a marketing strategy on tradeable goods and services;
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noted that greater interaction between large businesses and MSMEs is necessary to promote forward and backward linkages, enhance local entrepreneurship, and create jobs and skills;
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admitted that public-private sector partnerships (PPPs) are gaining in popularity; however, PPPs cannot be a substitute for a functional and capable state. The state has a primary responsibility for the provision of public goods including good healthcare, sanitation, water supply etc. and this must not be offloaded onto PPPs. A functional state is also necessary to regulate the PPP regime;
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further noted that PPPs face political risks particularly when there is a change of Government;
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underscored the fact that due to lack of finance local entrepreneurs are unable to partake in PPP arrangements, leading to foreign companies taking a large share of PPPs; furthermore, participants noted that local communities around PPP projects tend to miss out on these projects’ benefits;
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underscored the support and opportunities that the Diaspora could bring and tap into on investments in the region and the Continent and acknowledged the current efforts of the diaspora in investing in the energy sector in Africa; and
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acknowledged that non-convertible/tradeable nature of most national currencies impedes regional or cross-border trade in goods and services as market players, especially MSMEs, have to use cash or transact through or using the US Dollar, which in turn also puts pressure on exchange rates.
Recommendations
On the basis of the above observations, participants proffered the following recommendations:
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There is need for greater information sharing and policy exchange dialogues between the private sector and other key stakeholders including governments, RECs, AU, ECA and development partners in ensuring better coordination and support for the private sector in driving and benefiting from the regional integration process. Consequently, events such as the stakeholders’ forum organised by ECA, AU and ABG are highly encouraged;
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The private sector should be involved in the design, formulation, implementation, and monitoring of regional protocols, strategies and programmes on industrialization, regional value chains, cross-border trade, private sector development and issues of trade negotiation;
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Governments should have a long-term term view regarding costs and benefits of regional and continental agreements and protocols, rather than focusing on short term revenue gains;
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Governments and the RECs should ensure greater efficiency and smoothness at border posts for easy and timely passage of trucks and other economic related movements. This should include speedy clearance of goods through the use of technology, ensuring uniformity of rules between countries, providing adequately skilled human resources, as well as facilitating cross-border movement of persons;
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There is need for greater support for the informal cross border traders, particularly women traders in building their capacities in terms of understanding of policies, protocols and procedures regarding cross border trade, access to information on their rights, and access to facilities such storage, finance and general services;
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Being largely agrarian societies with most of the region’s citizens still engaged in the agriculture sector, the development of the agro-allied industry, enhancement of agricultural productivity, and regional value chains in agriculture must be promoted in Southern Africa;
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Governments should implement indigenisation policies with due consideration to effective strategic planning, issues of quality, standard and productivity, while encouraging citizens’ economic empowerment. Indigenisation policies should not be haphazard, impulsive, and promote inefficiency, cronyism and mediocrity;
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Governments should speedily domesticate regional agreements, protocols and strategies related to regional trade and investment in order for the private sector to take advantage of economic benefits of regional economic integration;
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Governments should put in place mechanisms that encourage FDIs to create linkages with local MSMEs, including in the agricultural sector, with a view of creating backward and forward linkages, capacity building, and job creation;
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Stakeholders, both public and private, should help build the capacities of business associations, assist them to get better organized, and entrench institutional mechanisms to having their voice heard on national and regional issues (e.g. NEDLAC in South Africa);
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PPPs are good and should be encouraged, however, it cannot be a substitute for state capacity in the provision of public goods and the regulation of the economy. The state must assume its full responsibility for the provision of essential public goods and services, while concentrating PPPs more on economic and resource generating activities;
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For PPPs to be sustainable, consultations with private sector, communities affected by PPPs, and other stakeholders need to be conducted; furthermore, such consultations will enhance accountability of, and improve, PPP arrangements;
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The Diaspora as the sixth region of the Continent should be encouraged to invest, partner with local businesses and promote business tours and linkages with the private sector in the region and the Continent; and
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There is need to develop a regional cashless/electronic payment system that would enable market players, including MSMES, to transact without using cash or trade through the US Dollar, as a way of facilitating regional trade in goods and services, ameliorate the exchange rate pressure on national currencies, as well as eliminate the risks associated with carrying and transacting using cash across borders.
Way Forward
In thanking the organizers for facilitating the Stakeholder Forum, participants encouraged the organizers to sustain the facilitation of private sector events such as this one. Participants requested organizers to circulate the Outcome Statement to key stakeholders at national and regional levels.
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Permanent Representatives’ Committee Meeting commends 5 key achievements made by the African Union since January 2018
Thirty-Sixth Ordinary Session of the PRC underway in Nouakchott, Mauritania
The launch of the Single African Air Transport Market (SAATM) in Addis Ababa in January, as well as the signing of the African Continental Free Trade Area (AfCFTA) and the pdf Protocol to the Treaty Establishing the African Economic Community Relating to the Free Movement of Persons, Right of Residence and the Right of Establishment (3.80 MB) in Kigali in March have been lauded as some of the key achievements of the African Union (AU) made in the period between January and June 2018. These initiatives are noted as being important in the drive for increased continental integration and promotion of regional trade and economic growth.
The AU also made progress in its drive towards the implementation of the ongoing Institutional Reforms and self-financing of the Union which aim to reposition the AU to deliver better service to African Citizenry as well as promote ownership of Africa’s development agenda by ensuring African states finance the activities of the AU.
The Permanent Representatives Committee (PRC) also lauded the efforts made in the adoption of the decision on the African Common Position for Negotiations of a new Agreement of Cooperation with the European Union on the future of AU-EU relations post-2020.
These successes were highlighted by the Chairperson of the PRC Ambassador Hope Tumukunde Gasatura of Rwanda at the official opening session of the 36th PRC meeting, which is the first in a series of three stakeholder sessions that comprise the statutory meetings of the AU Summit which is being held in Nouakchott, Mauritania, from 25th June to 2nd July.
The PRC meeting will be followed by the meeting of the Executive Council which consists of Ministers of AU Member states and will culminate in the level meeting of the Assembly of Heads of State and Government.
The ongoing PRC will consider reports of various sub committees and reports of the AU Commission and other organs of the African Union meeting in preparation for the ministerial meeting. They also have on their agenda, consideration of the African Union budget for 2019, as well as consideration of the draft decisions and declarations of the Executive Council.
While making his opening remarks, Ambassador Kwesi Quartey, the Deputy Chairperson of the African Union Commission noted that the PRC plays the important role of acting as the interface between the AU Commission and the member states of the AU to ensure a convergence of views between the two. Amb. Quartey emphasized that such coherence will ensure that “together we will fight against corruption”, which is the theme of the AU for 2018.
Mr Mohamed Mahmoud Sweid Ahmed, Secretary General of the Ministry of Foreign Affairs of the host country, Mauritania, welcomed all the delegates to the summit.
After the PRC meeting, the Ministers of Foreign Affairs, who form the Executive Council, will meet from the 28th to 29th July to prepare for the meeting of Heads of State and Government. The Heads of State meeting, to hold from the 1st to 2nd July will have, amongst other agenda items updates on the progress of the AU institutional Reforms programme championed by H.E. Mr. Paul Kagame of Rwandan; report on the African Continental Free Trade Area (AfCFTA) fchanpioned by H.E Mr. Mamadou Issoufou of Niger; and two reports from the Chairperson of the African Union Commission Mr. Moussa Faki Mahamat on the issues of Western Sahara and the African Common Position on the Post 2020.
A report on the situation of peace and security on the continent and the implementation of the AU master roadmap on practical steps to Silence the Guns by 2020 will be presented to the Assembly. Silencing the guns is a flagship project of Africa’s Agenda 2063. The Heads of State and Government will also adopt the budget of the African Union for 2019, following the recommendations of the Executive Council. Their decisions and declarations will guide the work of the AU as it implements its mandate of driving prosperity, peace and unity in Africa.
The summit is being held under the theme of the year “Winning the Fight Against Corruption: A Sustainable Path to Africa’s Transformation”, which is championed by H.E. President Mr. Muhammadu Buhari of the Federal Republic of Nigeria.
Statement by the AUC Deputy Chairperson H.E. Kwesi Quartey at the Opening Ceremony of the 36th Ordinary Session of the PRC
Allow me, on behalf of His Excellency the Chair, Dr. Moussa Faki Mahamat, to welcome you after long days of preparatory work in Addis Ababa, to Nouakchott, capital of the Islamic Republic of Mauritania, to the thirty-sixth ordinary session of the Permanent Representatives Committee. On behalf of the Commission, I would like to thank our Host Head of State, the Government and the brotherly people of Mauritania, not only for the warm and friendly welcome we have all enjoyed since our arrival, but also for the monumental effort proudly crystallized today in this truly magnificent conference center designed and constructed much grace, aesthetic quality and functionality.
I would like, also, to welcome everyone to Nouakchott to for this Summit in this enchanting city.
Since the end of the 30th ordinary session of the AU Summit held in Addis Ababa in January 2018 in the Federal Democratic Republic of Ethiopia, the PRC, under the dynamic and exemplary leadership of its Chairperson, Ambassador Hope Tumukunde Gasatura, assisted by our Bureau, the PRC and the Commission have followed a rhythm of work that been intense and productive.
The impact of her commitment and leadership, commensurate with the PRC’s critical role as the linchpin of the African Union, has been largely positive. I would, on behalf of our Chair and our Commission, like to thank our PRC for all their commitment and hard work we really do appreciate your critical work.
The evidence of this commitment is the heartening and encouraging collaboration and interaction of the Permanent Representatives in implementing the resolutions of the joint PRC-AU Commission on working methods during our joint retreat held in Cairo, the Arab Republic of Egypt, at the beginning of December 2017.
The preparation of 2019 budget which is being presented for your consideration and adoption is significantly different from how previous budgets have been prepared. This is a result of budgetary reforms that have been initiated within the AU.
You will recall that in January 2018 the Assembly took a decision to expand the committee of finance ministers from 10 members to 15 members. The assembly further directed that the F15 should sit jointly with the PRC and the Executive Council at both technical and ministerial levels to review the Unions budget proposal for consideration and adoption.
The assembly on the recommendation of the F15 also adopted nine golden rules as the underlying tenets for AU budget preparation and financial management.
The underlying rational for these very important decisions was to ensure the following:
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That AU budgets are well scrutinized to ensure the highest standards in accountability and judicious application of AU resources
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That AU budgets are in line with the goals and objectives of the Union as agreed by the leadership.
In line with the above decisions the budget that you will be considering is the first budget of the union to be considered by a joint sitting of the F15 and the respective PRC subcommittee. The process has been very rigorous and I can say the that the inclusion of the F15 in the process has significantly impacted on the level of discussions on this budget that is different from the past.
The introduction of budget ceilings in accordance with the golden rules has also proven to be very effective in helping brought with it a level of scrutiny and rigor previously unknown. This am sure the members of the subcommittee will readily attest to.
the introduction of the budget ceiling for the first time also provided a clear framework for the deliberations on the budget taking into account the revenues and expenditure capacities of the commission and the organs.
This year’s process as intended has provided valuable lessons to the commission as the lead organ for financial management of the union and these lessons will be used to strengthen further our budgetary and financial management practices.
The conclusions of the Cairo retreat, have been illustrative both in the work of the PRC and in the dynamism of collaboration between the PRC and the Commission. Indeed, the regularity of the meetings of the PRC, preceded by those of its enlarged Bureau, gave a new rhythm to the processing of the records and emphasized our common will to operate as two sides of the same coin.
This spirit of consensus, nourished by the diversity of points of view, has always transcended divergences to signify that the new Africa that we are committed to building is an Africa of unity in diversity, a unity which is more variegated and yet more integrated, and more democratic and inclusive and that is the Africa we want.
Of course, not everything has been perfect. Your justified complaints are known. Some are recurrent and they drive our efforts to perform the tasks of your mandate more effectively and transparently. The working documents for your deliberations are sometimes not readily available within the prescribed deadlines. When they are, they are not always in all the working languages of the Union. It has even happened that some of the PRC subcommittees postponed the holding of their meetings because of the lack of availability of meeting rooms. Yet we know democracy and debate and constructive criticism is critical for the strengthening of our organization.
Together we will find solutions in a timely manner. I would like to invite the PRC to make known the spirit of accelerating the progress of the AU towards achieving the objectives set out in its Agenda 2063 to prevail over everything. The call to integration contains within it an admission that as a continent, we are not fully integrated. We therefore need to locate some of this phenomenon in history. I would like to suggest that we focus in the Berlin conference 1884/85.
The centrality of the role of the PRC in the architecture of the various organs of the AU imposes on you, important obligations, as the interface between the Member States and the Commission to ensure, through quality information, convergence of views between the latter and the Commission in the best interests of the alignment and coherence of our actions. in this regard it is important to stress the need for interaction with the Commission within a balanced relationship, as the best means of pursuing the objectives set out in the Agenda 2063 calmly and effectively.
Therefore, we respectfully call for the 2019 budget to be examined in the light of two imperatives: accelerating the implementation of flagship continental-scale programs as vehicles for integration and substantially reducing the reliance of the African Union on funds of external partners.
We would like to draw your excellencies attention that in line with EX C 877 and 899 of 2016, the internal restructuring exercise of the of the commission has started. Under the first phase the Department of Administration and Human resource management is been restructured and decentralized into two departments (Human Resource Management and Administration) and two autonomous units. MIS and Safety and Security.
This is intended to significantly reduce the internal bureaucracy and end enhance effectiveness of delivery. The process will be completed by August after which the exercise will be extended to the other departments.
I cannot conclude without referring the harrowing sights of migrants drowning in the Mediterranean. These remind us that we need to govern better, and we need to govern better together. Let us mobilize permanently for the full success of the institutional reforms supposed to put our continent in a new geopolitical configuration. As such, we must sweep away the apprehensions that threaten to keep us captive in the present and adjust to the reality of a globalized world order in constant mutation.
Let us therefore pursue institutional reforms and work to render the being – THE AFRICA WE WANT. And finally, let us also congratulate our African team who are already making us proud at the ongoing world cup. We look forward to a Nigeria/Senegal final.
I wish you fruitful deliberations. Thank you for your kind attention.
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Industrial policy and late industrialisation in Ethiopia: The structure and performance of the manufacturing sector
The AfDB’s Vice-Presidency for Economic Governance and Knowledge Management has posted a series of new Working Papers and Economic Briefs. The following analyses have been prepared by Dr Arkebe Oqubay.
The structure and performance of the Ethiopian manufacturing sector
Although Ethiopia has emerged as one of Africa’s fastest-growing economies, its manufacturing sector is still far from being an engine of growth and economic transformation. It currently plays a marginal role in employment creation, exports, and output, and falls short on stimulating domestic linkages.
The sector is dominated by small firms and resource-based industries, low-value and low-technology products, and weak inter-sectoral and intra-sectoral linkages. The manufacturing sector’s export orientation has been low and stagnant.
Based on data and evidence from the past 25 years, the paper provides an in-depth analysis of the structure and performance of the Ethiopian manufacturing sector and further explores the reasons behind the ‘paradox’ of the slow growth of industrial outputs and structural shifts.
Since the mid-2010s, however, there are some promising signals that the manufacturing sector might be coming out of its doldrums and showing positive dynamics. The paper summarizes the growing challenges of building an industrial workforce and domestic capability, together with export capacity. The findings from this study show a bias for hope, as well as a potential structural transformation.
A bias for hope: Late industrialization in the early 21st century
Achieving Vision 2025, a plan to make Ethiopia the leading manufacturing hub in Africa, requires an annual manufacturing growth rate of 25 percent and an increase in manufacturing’s share of GDP to 20 percent by 2025.
The evidence above suggests the economy may fall short of this ambitious target. And as discussed, there are plenty of reasons to be sceptical about the prospects for success. Nonetheless, the evidence also suggests that Ethiopia’s commitment to structural transformation in recent years may be starting to bear fruit. The government has also developed the beginnings of a sharper policy focus. First, it encouraged investment in new productive capacity, especially in priority manufacturing activities (in light manufacturing, basic wage goods and import substitution, and strategic new industries such as new energy). Light manufacturing industries are acknowledged to be export oriented, labor intensive, linked to agriculture, and involve tradable goods.
Second, a new approach to hub development, agglomeration, and clustering was deemed essential, with the focus on building sustainable, specialized parks that apply a plug-and-play model. The major departure occurred during GTP II when the government decided on a comprehensive industrial hubs strategy, with the aim of developing 25 industrial parks, of which some were operational by December 2018. Ethiopia’s unique model of hub development and industrial parks has been based on systematic learning (from South Korea, Singapore, China, Vietnam, Mauritius, Nigeria, and a review of the brief experience in Ethiopia). Learning by doing was supported through piloting and experimenting at Hawassa Industrial Park.
There are positive indications of the effect of this new strategic approach. The quality and volume of FDI inflow has shown very rapid growth and change. FDI almost quadrupled to US$4.2 billion in 2016/17 from US$1.1 billion in 2011/12. Manufacturing drew in more than 80 percent of FDI during this period. McKinsey’s survey (2017) shows that about two-thirds of all Chinese firms in Ethiopia were engaged in the manufacturing sector, which is twice the average of Chinese firms’ engagement in Africa. In the export-oriented apparel and textiles sector, the contribution of FDI firms has grown in recent years and accounts for about 70 and 60 percent of exports and employment respectively.
Conclusion: enduring constraints
By early 2018, there was inadequate evidence to fully assess the effectiveness of these policy responses. The three strategic issues below required comprehensive and long-term attention. First, as Ethiopia embarks on late industrialization, building an industrial workforce has become a strategic issue of concern. Firms and industrial associations have developed joint initiatives to develop and upgrade workers’ skills in collaboration with government agencies and development partners, which has led to some positive results. High absenteeism and labor turnover eroded attempts to develop labor force skills in order to increase productivity. Labor sourcing and supply has been constrained by lack of well-developed labor market institutions to recruit and train workers, low wages, weak industrial relations, rapidly increasing living costs, and lack of affordable housing in host cities. Moreover, human resource issues related to personnel management and communication have also been cited as potential constraints in firms observed. Oya highlights that building an industrial workforce is uneven, protracted, and requires wider state intervention. Based on the historical account of the UK and continental Europe, Thompson (1967: 90) underlines that it may take several generations to perpetuate and ‘institutionalize’ industrial work discipline.
Second, an equally important strategic issue for Ethiopia’s industrialization is the development of domestic industrialists and linkages. There has been little participation by domestic firms in highly competitive export-oriented manufacturing for a number of reasons. There has also been a lack of access to long-term industrial financing for domestic firms due to the limited capacity of public banks and the lack of interest by private banks in such financing. The political economy constraints favored investment in more profitable sectors and speculative activities rather than in export-oriented manufacturing. Despite an industrial policy that has in some respects been prepared to ‘get prices wrong’ in order to encourage accelerated manufacturing activity, relative prices in the Ethiopian economy clearly still deflect investors away from manufacturing.
Accelerating learning within the global economy is as critical as relaxing constraints on the balance of payments. The hope was that industrial parks would facilitate this, by promoting production linkages and learning from the interaction between domestic and foreign firms. But these learning outcomes did not instantly materialize. Moreover, additional support schemes and incentives (such as government cost sharing and loans) designed to promote skills and productivity were not entirely translated into action.
Third, Ethiopian manufacturing needed a breakthrough in export performance. Export-led industrialization and import substitution should be seen as complementary rather than mutually exclusive. In addition to an overvalued exchange rate and inadequate institutional support for exporters, the lack of internationally competitive export logistics and trade facilitation, especially important given that Ethiopia is landlocked, became key binding constraints on export-led industrialization. The construction and operationalization of the new national railway network and construction of the Grand Ethiopian Renaissance Dam are part of the strategic responses that will ultimately determine the success of Ethiopia’s late industrialization. So too are the recent investments by Ethiopian Airlines to expand its freight terminal and to foster integration into global logistics networks.
Industrial Policy and Late Industrialisation in Ethiopia
Industrial Policy in Ethiopia: An Introduction
More than fifteen years into a period of sustained and rapid economic growth, Ethiopia has continued to attract international attention for its achievements and for pursuing a home-grown development strategy, with an active industrial policy at its center. Some have been sceptical about Ethiopia’s development model. While a 2017 BBC documentary asked: “Can Ethiopia be Africa’s leading manufacturing hub?,” the Financial Times was dismissive, arguing in an article entitled "Ethiopia’s mythical manufacturing boom” that the Ethiopian government had waged a successful PR campaign by selling “a story that does not really exist.” The Ethiopian People’s Revolutionary Democratic Front (EPRDF) had initially targeted agriculture as the key driver of post-war economic take-off (1995-2015) but increasingly pursued the development of the manufacturing sector as the prime driver of sustained economic growth and structural transformation post 2010. Nonetheless by 2018, per capita income remained very low and it was services that had come to dominate the economy rather than manufacturing. Despite being able to feed its growing population, Ethiopia – Africa’s second and the world’s twelfth most populous country – faced intense structural constraints.
Industrial policy and structural transformation
An industrial policy can be a vehicle for catch-up and structural transformation, and increasingly such a policy must focus on how an economy is integrated into global trade and production networks. Industrial policy may be defined as “a strategy that includes a range of implicit or explicit policy instruments selectively focused on specific industrial sectors for the purpose of structural change in line with a broader national vision and strategy” (Oqubay 2015: 18).6 Structural transformation involves the shift (of an irreversible and permanent nature) of people and economic activities between sectors, and from less to more productive activities. It involves diversification (both vertical and horizontal) into new more dynamic activities, fostering domestic linkages and building technological capabilities, and developing the stock of technical knowledge that constitutes wealth. There continues to be convincing evidence that manufacturing is the engine of structural change and sustained growth. This is because of the greater scope in manufacturing (broadly defined to include high-productivity agricultural production) for economies of scale, learning by doing, technological development, and productivity gains, together with the strong links between manufacturing and other sectors. Manufacturing also has powerful direct and, perhaps even more important, indirect employment effects. Another central – and often neglected – component in structural transformation is the strategic role of exports. First, exports drive international learning, and hence catching up. Second, exports expand demand and increase productivity gains. Third, exports relax the balance of payments constraint, while enhancing the viability of import substitution. For a late latecomer such as Ethiopia, the key challenge is to be able to catch up by learning from forerunners, and to mobilize abundant, scattered, and underutilized forces for the purpose of development.
Against this background, this paper examines the Ethiopian experience of industrialization and industrial policy in the early twenty-first century. The paper reviews the origins of Ethiopia’s industrialization and industrial policymaking process in the 20th century. The Ethiopian government has pursued developmentalism and practiced an active industrial policy since the early 2000s. However, a review of industrial policies in various priority sectors shows that the outcome has been uneven across sectors, indicating the importance of the strong interaction between industrial structure, linkage dynamics, and politics/political economy for the evolution and effectiveness of an industrial policy.
After examining the fundamental weakness in Ethiopia’s economic structure, this paper will illustrate why and how industrial policy must focus on manufacturing and exports to generate structural transformation and accelerate catch-up. The Ethiopian experience shows that an activist industrial policy goes hand in hand with an activist state.
Dr. Arkebe Oqubay is a Minister and Special Advisor to the Prime Minister of Ethiopia, Dr Abiy Ahmed. The above papers are forthcoming in The Oxford Handbook of the Ethiopian Economy, a volume edited by Chris Cramer, Fantu Cheru, and Arkebe Oqubay, to published by Oxford University Press in 2019.
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tralac’s Daily News Selection
A reminder: The Southern African Structured Trade Seminar is underway in Livingstone. For Twitter updates: #SAST2018
WTO’s Trade Facilitation Agreement: update
“Almost 85% of WTO members have now completed their domestic ratification processes. This is great progress, but of course there is more to do,” DG Azevêdo said at the launch of a new report Trade facilitation and the global economy published by the OECD. “We all know the potential that the TFA has to cut trade costs. This report takes a closer look at why this matters. For example, it highlights the difference that this will make for MSMEs, which often face a prohibitively high cost of trading. It also highlights the fact that inefficient border procedures multiply the costs when goods and components cross borders many times during their production,” DG Azevedo said. As of 26 June, the current rate of implementation commitments of the Agreement stands at 60.4%. Broken down by level of development, this equates to a 100% rate of implementation commitments by developed members, 59.1% among developing members and 21.6% among LDCs according to the TFA Database.
Carlos Lopes: A continental trade bloc could transform Africa’s economies (Chatham House)
14th NCIP Summit: updates
EAC leaders commit to hasten implementation of regional projects. Leaders of EAC states implementing joint infrastructure projects on Tuesday agreed to speed up their implementation during a review of the progress at the 14th Summit of the Northern Corridor Integration Projects, which was held in Nairobi on Tuesday after a two-year break. President Paul Kagame said the resumption of the review meetings held by all EAC members except Tanzania and Burundi will bring in new momentum to enable the region to complete the joint road, railway and power projects.
Outcomes: To ease the circulation of petroleum products in the region as a key source of industrial and domestic energy, the leaders agreed to come up with ‘the Lake Victoria intermodal transport system’ pending consultations on re-scoping of refined petroleum products pipeline. On the setting up of a commodities exchange, the Summit received an update on the harmonisation of standards for commonly traded commodities and directed partner states to fast track the process.
East African leaders push for quick deal on SGR. Ministers in charge of implementing the NCIP in Kenya, Uganda, Rwanda and South Sudan have until September to conclude financing agreements for construction of Standard Gauge Railway in the region. The financial agreement is for the construction of Naivasha-Kisumu, Kisumu-Malaba, Malaba-Kampala sections that fall within the NCIP. The Heads of States Summit further directed that the application for financing of the Kampala - Bihanga - Mirama - Kigali, Tororo - Gulu - Nimule / Gulu-Pakwach section be expedited. [NCIP leaders agree on common satellite project]
Downloads from recent regional conferences:
(i) The NEPAD Dialogue on Advancing Infrastructure Development in Africa:
Opening remarks by Symerre Grey-Johnson: For the previous 10 years, NEPAD Agency, the AfDB and other relevant partners have dedicated time and energy to assess Africa’s need in terms of infrastructure development, identify and prioritize and classify transformative and development impactful regional projects, evaluate the challenges and continuously design responsive instruments to those challenges. This journey led to the endorsement of PIDA as the continental flagship program and policy framework, development of PIDA Capacity building project, establishment of the Project Preparation Facility Network, the Continental Business Network and the PIDA Service Delivery Mechanism, etc. Most recently, the NEPAD Agency launched the 5 % Agenda Campaign and the AfDB inaugurated the Africa Investment Forum. It is time that we consolidate these efforts. We need a systemic and integrating strategy of Project Preparation and Project Financing, an approach capable to help us moving infrastructure projects from concept to financial close through an efficient use of all these instruments and initiative.
Brief on PIDA Job Creation Toolkit: To serve as a practical tool catalyzing a new African jobs focus in the development and operation of Africa’s infrastructure projects, maximising the number and quality of African jobs. Key value-added features: Uses National Input-Output Tables, leveraging decades of job estimation approaches used worldwide by multilateral organizations (e.g., World Bank, OECD, etc.) and governments of both developing and developed countries; Includes Full Spectrum of Job Creation; Provides Labor Market Information – Breaks out project job estimates by economic sectors for planning of skills development & education programs; and Serves as Advisory Tool for Job Creation Interventions: Provides Policymakers, Project Owners, partners and other stakeholders with range of job maximization policies, programs, processes, etc. with case study examples and resource links.
NEPAD CBN - 5% Agenda Campaign: Developing Innovative project financing mechanism. (i) NEPAD Agency will play its role of coordination and lead facilitator institution in to gather all the Development Finance Institutions (DFIs) and the Multilateral Development Banks (MDBs) with the sole aim of having a frank and open discussion on the establishment of a and aggregated scheme. (ii) Pool all the partial guarantee instruments into a “big facility” that will provide for 100% financial guarantee for institutional investors such as Pension and Sovereign Wealth Funds and Insurance Companies to invest comfortably in PIDA and trans-boundary infrastructure projects. (iii) The “big facility” will serve as the guarantee mechanism that will payout in the case of payment defaults by project owners/operators through African Ministries of Finance. [Plus: NEPAD-AU 5% Agenda: Attracting institutional investors in African infrastructure development; African Infrastructure Guarantee Scheme; African Infrastructure Guarantee Facility]
(ii) The UNECA Southern African Office workshop on Corruption and the challenge of economic transformation in Southern Africa: explore the seven presentations made available to tralac for posting on its website
Algeria’s parliament backs higher customs duties in place of ineffective import ban (Reuters)
Algeria’s lower house of parliament approved on Monday a government plan to lift a largely ineffective ban on imports of many goods and replace it with customs duties of between 30 and 200%. A committee made of the ministries of trade, finance and industry will be set up to determine the list of goods to which the duties will be applied, the government said. At the start of this year Algeria banned the import of 851 products, including mobile phones, home appliances and some foodstuffs, but the measure had little impact on imports, which have mostly continued in defiance of the ban.
Rwanda: Trade deficit reduces by 1.4% (New Times)
Rwanda’s trade deficit reduced by 1.4% in the first five months of 2018, compared to 2017, latest statistics from the central bank show. This was attributed to an increase in formal exports revenues by about 29% which outweighed an increase in formal imports, at 9%. The trade deficit as of January this year had gone down to Rwf1271.8B from Rwf 1624.5B in 2016. The reduction of the trade deficit has seen the Rwandan Franc remain stable against the dollar with the central bank projecting that annual depreciation will be at around 4.5%. [Rwanda: Why loans to private sector went down in 2017]
Tanzania to boost earnings from cotton exports (China.org)
Mary Mwanjelwa, the Deputy Minister for Agriculture, told the National Assembly that the plan is to increase cotton exports from the current $30m to $150m by 2020. “We have a number of strategies that have been implemented since 2017 to ensure cotton production surpass the 600,000 tonnes mark,” said Mwanjelwa, adding that the improved quality of the seeds also added value to the commodity. She noted that the plan is a new blueprint adopted by the government and other stakeholders to improve the production of cotton in the country, and the government is working to re-establish some internal systems starting with the production of seeds. [This is why cashew nuts have gripped Tanzania’s parliament]
MARKUP initiative to boost market access to Europe for East African SMEs (ITC)
Agribusinesses in EAC countries are to benefit from greater business opportunities in both East African and European markets thanks to a new initiative funded by the European Union. Central to MARKUP will be improving the compliance of SMEs with international quality and standards requirements. Improving awareness and transparency related to sanitary and phytosanitary measures, as well as on technical barriers to trade, will enable participating SMEs to gain product certification that will ease their efforts to enter foreign markets. A regional steering committee chaired by the EAC Secretariat, which will include representation from relevant national ministries, will provide overall direction for the programme. [East Africa’s exports to EU edge up 8%]
Afreximbank, ECIC announce $1bn programme to promote South Africa-Africa trade
The African Export-Import Bank and the Export Credit Insurance Corporation of South Africa yesterday launched the South African-Africa Trade and Investment Promotion Programme. Afreximbank and ECIC will work together to identify, prepare and appraise trade transactions and projects; explore co-financing and risk-sharing opportunities; and share knowledge, with particular emphasis on intra-African trade matters, through technical cooperation, staff exchange, research and joint events. It would also provide advisory services and guarantees to South African investors seeking trade and investment opportunities in Afreximbank African member countries.
Catherine Grant Makokera, Brian Mureverwi: MDC Alliance targets closer links with regional bodies (Business Day)
If it came off, a proposal by Zimbabwe’s official opposition to join SACU, the oldest customs union in the world, one that is anchored in SA’s membership, would be far-reaching. Even more profound would be the move to join the region’s monetary union. To appreciate the implications of the MDC Alliance proposal it is important to understand a few key points:
Impasse in transforming SADC-PF into a parliament – Angolan MP (EIN)
The impasse in the transformation of the SADC Parliamentary Forum into a regional parliament is due to the fear of losing sovereignty by some of the countries that make up the regional organization, said the Angolan MP and spokesperson for the 43rd Plenary Assembly of the SADC Forum Parliamentary, Josefina Pitra Diakité. Among the parliaments of the countries that favour the elevation of the Forum into a Parliament, of the 14 that make up the platform, Diakité highlighted Angola, South Africa, Namibia, Eswatini (former Swaziland), Botswana and Mozambique.
Wednesday’s Quick Links: Linda Calabrese: Rwanda’s used clothes sellers are struggling Rwanda steps up crackdown on used clothes Nigeria’s fertilizer consumption rose by 63% in 2017; Ghana’s by 82% The growth dynamics of new export entrants in Kenya: a survival analysis AfDB EOI: Development of a new five-year governance strategy to guide lending and non-lending operations on governance in regional member countries Ghana’s Value for Money Conference: Cost of government projects to be standardized Water Institute of Southern Africa Biennial Conference: Breaking Boundaries, Connecting Ideas SADC Ministerial: South Africa to align energy plans with SADC gas master plan AIIB updates: India’s Modi urges AIIB to boost lending 10-fold to $40 bn: text of speech; No ‘debt trap’ with AIIB, president vows; Civil society sounds alarm on AIIB’s latest ‘hands-off’ lending deal; AIIB chief bats for China’s one-belt plan |
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WTO members take stock of progress on implementing Trade Facilitation Agreement
“Almost 85 per cent of WTO members have now completed their domestic ratification processes. This is great progress, but of course there is more to do,” DG Azevêdo said at the launch of a new report entitled Trade Facilitation and the Global Economy published by the (OECD.
“We all know the potential that the TFA has to cut trade costs. This report takes a closer look at why this matters. For example, it highlights the difference that this will make for MSMEs (micro-, small- and medium-sized enterprises), which often face a prohibitively high cost of trading. It also highlights the fact that inefficient border procedures multiply the costs when goods and components cross borders many times during their production,” DG Azevêdo said.
“The Agreement is a truly inclusive endeavour. This was true of its design and its negotiation, and it will be true of its impact,” he said.
The report finds that trade facilitation measures are being implemented worldwide although the progress is uneven across different countries and across the various provisions of the TFA, the Organisation for Economic Co-operation and Development (OECD)’s Julia Nielson and Evdokia Moise said at the book launch. Early improvements have been observed in areas such as automation and streamlining of procedures as well as engagement with the trade community, while the biggest challenge appears to lie in the cooperation of domestic and cross-border agencies, the report states.
WTO members heard further updates from the Secretariat on the implementation of the TFA at the Committee on Trade Facilitation meeting held after the book launch. The current rate of implementation commitments of the Agreement stands at 60.4 per cent as of 26 June.
Broken down by level of development, this equates to a 100 per cent rate of implementation commitments by developed members, 59.1 per cent among developing members and 21.6 per cent among least developed countries (LDCs) according to the TFA Database. The figures correspond to the portions of the TFA that have been legally committed to implementation.
Developed countries committed to implement the Agreement in full upon its entry into force in 22 February 2017, while developing and least-developed members set their own timetables for implementing the TFA, taking into account their respective capacities. These commitments have been communicated to the WTO in a series of notifications.
Developing countries will immediately apply the TFA provisions they have designated as Category A commitments. For the other provisions of the Agreement, they must indicate when these will be implemented and what capacity building support is needed to help them implement these provisions, known as Category B and C commitments. These can be implemented at a later date, with LDCs given more time to notify these commitments.
So far, the WTO has received 113 notifications of Category A commitments, approaching the overall number of notifications in this area that is likely to be received. The current number of Category B commitments stands at 67 and at 56 for Category C.
Furthermore, the Committee meeting featured an experience-sharing segment that focused on the themes of regional approaches to trade facilitation and the provision of opportunities for public comment and consultations on regulatory procedures.
Members also considered the most recent notifications since the last Committee meeting and called on each other to submit the necessary information for transparency. They further heard updates on trade facilitation activities of fellow members and of the Trade Facilitation Agreement Facility.
The next Committee meeting will be in early October.
Launch of OECD book, ‘Trade Facilitation and the Global Economy’, at the WTO
Remarks by DG Azevêdo
Welcome to our colleagues from the OECD. On behalf of the WTO, I am pleased to help launch this publication on Trade Facilitation and the Global Economy. I’d like to congratulate everyone involved.
I won’t speak for very long this morning. I just wanted to add my words of thanks and encouragement – and to underline a few notable elements of this excellent report.
The first point is that I think the report shows the critical importance of the Trade Facilitation Agreement.
We all know the potential that the TFA has to cut trade costs. This report takes a closer look at why this matters.
For example, it highlights the difference that this will make for MSMEs, which often face a prohibitively high cost of trading.
It also highlights the fact that inefficient border procedures multiply the costs when goods and components cross borders many times during their production.
This is the economic reality today. Nearly two-thirds of traded goods have components that were made in at least two different countries. Improving facilitation and lowering costs will help to remove obstacles to joining global value chains. And this will help new participants to join these chains of production.
So we need to keep working to implement the TFA.
Almost 85 per cent of WTO members have now completed their domestic ratification processes. This is great progress, but of course there is more to do.
There is a collective effort behind the implementation of the TFA. And we are very pleased to have partners such as the OECD lending their ongoing support – particularly to provide additional knowledge of what is actually happening on the ground.
This brings me to another notable element of this report, which is that it introduces the OECD’s new Trade Facilitation indicators.
Using information collected in cooperation with: (i) members; (ii) partner organisations; and (iii) the private sector, these indicators will be a very useful tool.
They will support the monitoring and benchmarking of countries’ engagement on trade facilitation, providing verified information on exactly what practical steps have been taken.
And, in this way, they will be of huge help to policy makers. They will allow them to assess the state of their trade facilitation reforms, highlight challenges and identify room for improvement.
This is of huge interest to governments, traders and other stakeholders alike. And it is a real boost to the implementation of the Trade Facilitation Agreement, complementing our work at the WTO.
This brings me to my final point, which is the importance of cooperation.
We need to keep fostering cooperation, not just amongst organisations, but also with the private sector and other partners who are engaged in trade facilitation reforms.
This has been a fundamental tenet of our work here over the years. And now that the Agreement has entered into force, cooperation continues to be key.
We see this in the TF Committee, which is going to meet right after this event.
The Committee has got off to a good start. It allows members to raise all matters related to the implementation of the Agreement. Delegations are regularly updated on the state of the notification and ratification process. And it is an opportunity for them to lend each other a helping hand – both in sharing their experiences and by offering technical support.
The WTO Secretariat also assists in every possible way – and I am heartened to see partners like the OECD willing to engage and play an important role as well.
The TFA continues to be a positive example for what is possible when we work together for a common cause.
This is one of many lessons that we learned from the whole TFA experience. And we should seek to apply it in other areas as well. It showed us the importance of flexibility and creativity in finding convergence among 164 countries of vastly different economic and development status.
The Agreement is a truly inclusive endeavour. This was true of its design and its negotiation, and it will be true of its impact.
The TFA and its reforms will help smaller businesses to trade, including women-owned businesses. It will deliver greater gains to poorer economies. And it will provide technical assistance and capacity support for those economies in their implementation efforts.
So let’s keep working together to ensure that the Agreement is implemented as quickly and effectively as possible – to the benefit of all.
Thank you once again to the OECD, and to all of you, for your support.
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NEPAD Strategic Dialogue on Advancing Infrastructure Development in Africa: Technical Experts Meeting presentations
Opening Remarks by Mr. Symerre Grey-Johnson, Head of Regional Integration, Infrastructure and Trade
On behalf of Dr Mayaki, CEO of the NEPAD Agency, I would like to welcome you to this Dialogue on advancing infrastructure development in Africa. NEPAD is pleased to always count on your commitment to Africa’s transformation and I am delighted by the interest of your various institutions in NEPAD’s efforts and initiatives to enhance regional trade and create shared prosperity through the Program for Infrastructure Development in Africa (PIDA). I wish also to express our thanks and appreciation to our host, the Zimbabwean Government and People, for their usual hospitality and warm welcome.
The story of Africa’s development is changing. NEPAD is happy to be to be part of this upward transformation process, together with our partners, we are confident that we can deliver the promise of the NEPAD’s ideals: putting Africa on the right path of sustainable development and inclusive growth.
It is worth noting by 2022 the installed generation capacity of energy in Africa will increase by 50%, specifically North Africa region will be the major player in term. Additionally, access to electricity and the rate of ICT penetration has significantly is significantly increasing: Since the continent’s first ever Independent Power Producer (IPP) in 1994 in Cote d’Ivoire, Africa has witness a plethora of double digit growth in IPPs.
This dynamic is the reason why the NEPAD Agency has influenced ministerial decision to establish a continental power transmission for regional energy trade in Africa. The envisaged system will allow these numerous IPPs to sell into the grid for the power pools.
Similarly, the Continent has witnessed a number of toll roads. The secrets of success of Africa’s road Public-Private Partnership remains in the in reinforced concessions guided by clarity and consistent decision making process and political committed.
Indeed, despite the fact the government changes, the policy decision remaining consistent in terms of infrastructure development in many African countries. We need to applaud and be proud of that
This meeting is special for NEPAD, we are here to set the scene for exploring innovative measures and instruments to close the 108 billion infrastructure gap on the continent. The NEPAD’s position is that the greatest challenges facing infrastructure delivery in Africa is not funding, what matters the most is the absence of coordinating infrastructure governance mechanism, articulated instrument for project structuring and finance and most importantly sustainable resource mobilization strategies to channel the billions dollars of Africa’s liquidity into Infrastructure projects.
For the previous 10 years, NEPAD Agency, the African development bank (AfDB) and other relevant partners have dedicated time and energy to assess Africa’s need in terms of infrastructure development, identify and prioritize and classify transformative and development impactful regional projects, evaluate the challenges and continuously design responsive instruments to those challenges. This journey led to the endorsement of PIDA as the continental flagship program and policy framework, development of PIDA Capacity building project, establishment of the Project Preparation Facility Network (PPFN), the Continental Business Network and the PIDA Service Delivery Mechanism, etc. Most recently, the NEPAD Agency launched the 5% Agenda Campaign and the AfDB inaugurated the Africa Investment Forum.
It is time that we consolidate these efforts. We need a systemic and integrating strategy of Project Preparation and Project Financing, an approach capable to help us moving infrastructure projects from concept to financial close through an efficient use of all these instruments and initiative.
This dialogue is designed to be a multi-stakeholder consultation aiming at defining concrete policy recommendations for Africa’s leadership that advance infrastructure projects implementation under the umbrella of PIDA. The 2018 Dialogue will focus on three work streams: (1) How to mobilize African institutional investment for infrastructure development in Africa through the NEPAD 5% Agenda Campaign; (2) Options to scale risk mitigation and operationalize an effective African Guarantee Scheme that enables the mobilization of institutional investment and private finance for African infrastructure projects; and (3): How to create the foundation for the bankability of transboundary projects, including how to enhance the role of the PIDA Service Delivery Mechanism (SDM) in early stage project preparation.
I would like to invite us to an open and frank discussion on technical issues hampering infrastructure development in Africa. Indeed as of today, all of us as development practitioners and technical experts in our respective fields are all aware of the main challenges and obstacle as to de-risking infrastructure project development in Africa and the potential that represents the institutional investment community to fill the infrastructure gap, a tremendous role that is now of public knowledge.
The complexity of these various opportunities and challenges that we are all facing, force us to stop working in close partition and work together in finding the appropriate solutions enabling us to achieve a common goal, dear to all of us, that is to develop Africa s infrastructure. I am sure that we will define a roadmap on which all of us, as well as other stakeholders, should find our roles and areas of contributions.
As I conclude, I wish to state once more that our presence today by the mighty Victoria Falls is not just about intellectual exercise. We are here to reflect and generate concrete recommendation and experts views in order to feed NEPAD’s policy process to the African union leadership.
We will reconvene afterward to follow up on the points we will agreed upon during these two days.
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Long term strategic vision, vital to leveraging sustainable infrastructure, stakeholders agree at roundtable
Africa has huge infrastructure gap, estimated at $130-170 billion per year. However, this infrastructure gap goes beyond just financing. There is a lack of good governance of infrastructure too.
This was the focus of the Second Global Roundtable on Infrastructure Governance, organized by the African Development Bank and World Bank, which kicked off in Grand Bassam, Abidjan, Cote d’Ivoire, on 21 June 2018, under the theme “Building the right infrastructure for tomorrow”.
Highlighting the critical contributions of the African Development Bank to infrastructure financing and governance in Africa, the Director for Infrastructure and Urban Development, Amadou Oumarou said that there is an urgent need to build a sustainable infrastructure, which is the responsibility of governments, private investors, international organizations and project beneficiaries. “This requires a strategic vision driven by all actors,” he underscored.
Oumarou made these submissions during the panel discussion on the difficulties of designing a crucial and strategic vision for infrastructure. The panelists discussed the key obstacles for preparing and implementing long term strategic vision. Reflecting on factors and lessons from successful cases around the globe, they observed that an appropriate strategic planning is critical to infrastructure sustainability. Nevertheless, it is also indispensable to plan on the long term, with the involvement of the private investors as well as projects beneficiaries.
Drawing upon country-level experiences, the panelists cited the cases of South Africa and Morocco, where the governments made it a commitment to prepare and follow up a long term strategic vision for infrastructure. These two countries were successful cases to learn from, due to government’s support to the investment plans, and the commitment to work with the private sector.
They also consented to the need for bilateral agreements at project preparation between the private sector and the governments. This, they said, is instrumental in mobilizing resources and undertaking the technical works. However, much time should be invested in the preparation phase than implementation period.
The panel members comprised Soumaia Liboukili, Chief of transport at Morocco Economy and Finance Ministry; Himesh Dhungel, MCC Senior Strategy Adviser for infrastructure and private sector; Chukeka Mhlongo, DBSA’s General Manager for Infrastructure Finance; Amadou Thierno Diallo, Islamic Development Bank’s Director of Global Practices, Economic and Social Infrastructure; Isabelle Van Grunderbeck, Regional Representative of the European Investment Bank and Marc Teysier d’Orfeuil, Délégué general, Club PPP, MedAfrique.
Earlier, a panel discussion on – Why infrastructure is so hard to get right? – reflected on the main governance issues and bottlenecks to successful infrastructure investments, and what can be learnt from the cases that were successful and the way forward. The session was moderated by Tom Barret, Chairman OECD Infrastructure Forum, with key presenters such as Pascale Dubois, World Bank Vice-President for Integrity; Freddy Kita, DRC’s International Cooperation Vice-President; Charle-Henri Maleko, Director General of Science and Technology Options Assessment (STOA) Infrastructure Investment (Affiliated to the Agence Française de Development-AfD); Sydney Domoraud, Managing Partner of Energy, Mining, Infrastructures, Real Estate (EMIRE) and Tafadzwa Pasipanodya, Partner at Foley Hoag.
Exploring the strategies for building the right infrastructure and winning the war against corruption, panelists noted that a stable political, economic legal regime and environment was desirable.
They argued that private investors generally look at returns on investment in infrastructure business as a priority rather than ensuring long-term public interest. The discussions focused on the importance of a strategic planning involving the government, the project beneficiaries as well as the private investor, while undertaking the economic evaluation prior to launching a viable infrastructure project.
They also stressed the need for the private investors, not only to deliver under a high level of good governance, but invest in sustainable infrastructure and also plan for long term technological update.
Building on cases in Africa and other parts of the world where public-private partnership investment were made for infrastructure projects, panelists expressed the need for private investors and international organizations to work together. They said PPPs financing is a good way to mobilize funds and should be adapted to Africa, but the need for a win-win policy was also highlighted. Africa should also consider PPP as an effective instrument to mobilize funding and draw lessons from South Africa, where this type of investment has worked.
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14th Summit on the Northern Corridor Integration Projects
President Paul Kagame has called for increased partnership between multiple players in the Northern Corridor to fast-track the development of citizens.
The President was speaking at the 14th Summit of the Northern Corridor Integration Projects (NCIP) held in Nairobi, Kenya.
The summit, hosted by President Uhuru Kenyatta of Kenya, was the first Northern Corridor summit to be held since 2016.
During his speech, President Kagame called for the re-examining of required efforts to enable the implementation of joint projects that will develop lives of citizens.
“We had made headway in bringing government, businesses, local and foreign investors in partnership to enable these projects that are important to the development of our citizens,”
“There is always going to be a lot of work to do but this moment provides an opportunity to re-examine what has been done and what we still need to do,” the head of state said.
During the summit which was preceded by a ministerial meeting, the leaders reviewed the progress made in the implementation of the various resolutions reached at the 13th Summit.
Northern Corridor key projects
Among the key projects that featured prominently during the meeting is the Standard Gauge Railway (SGR) which is supposed to connect the port of Mombasa to Kigali via Uganda.
On this, the leaders directed that application for financing of Kampala–Bihanga–Mirama–Kigali, Tororo-Gulu–Nimule/Gulu–Pakwach sections be expedited.
The leaders commended the implementation of a modern railway network in Kenya as part of the first phase of the SGR from Mombasa to Nairobi.
The preliminary engineering design of the new SGR line from Kampala to Kigali was completed in January 2018.
In the joint communiqué, the East African leaders reaffirmed their commitment to advancing regional integration while underscoring the importance of accelerating socio-economic transformation, industrialisation and employment creation.
To ease the circulation of petroleum products in the region as a key source of industrial and domestic energy, the leaders agreed to come up with ‘the Lake Victoria intermodal transport system’ pending consultations on re-scoping of refined petroleum products pipeline.
Further, the leaders agreed to allocate more funding for the development of centres of excellence to support creation of requisite human resource capacities needed for the implementation and sustenance of NCIP projects.
On the setting up of a commodities exchange, the Summit received an update on the harmonisation of standards for commonly traded commodities and directed partner states to fast track the process.
“The summit directs partner states to expedite development of interlined trading platforms,” leaders noted in the communiqué.
The summit also considered and adopted the Accession Treaty to the Mutual Defence Pact and agreed to finalise an agreement on the establishment of a Centralised Aeronautical Database for the Northern Corridor Airspace bloc.
The Heads of State were also briefed on the progress being made in ICT and will be keen on the status of the One Network Area (ONA) for voice which is fully operational in all the partner states, while ONA for data is operational in Kenya, Uganda and Rwanda.
Also present at the summit was President Yoweri Museveni of Uganda while President Salva Kiir of South Sudan was represented by a special envoy Aggrey Tisa Sabuni.
The summit was also attended by Kenya’s Deputy President William Ruto as well as representatives of Tanzania, Burundi and Ethiopia, countries which have an observer status in the NCIP.
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tralac’s Daily News Selection
Next month’s BRICS Summit: preview by Standard Bank’s Jeremy Stevens
South Africa will host the 10th annual summit of the Brazil, Russia, India, China and South Africa group. The BRICS Heads of State will meet at the Sandton Convention Centre in Johannesburg (25-27 July) at a time that the global economy is mired in uncertainty. Extracts:
It would be foolish to ignore the strong business cycle synchronization between emerging markets and the rest of the world. However, the BRICS must find ways to elevate their commercial relevance to one another. Unfortunately, the commercial relevance of the BRICS to one another is minimal. Intra-BRICS trade has actually fallen, from $342bn in 2013 to $312bn in 2017. Furthermore, taken as a share of their respective trade, the BRICS share has plateaued, after doubling from 6% 2003 to 12% 2011. In fact, it fell sharply in 2016.
The trade data is simple; for each of the BRICS, China is a large trade partner; just 20% of BRICS trade excludes China. The trade relation is therefore unbalanced. China is exporting manufactured goods to the other BRICS in proportions consistent with their relative GDP, whilst importing mineral products from Russia, Brazil and South Africa, and prepared foodstuff from Brazil. In fact, there isn’t anything particularly special about the commercial cords between BRICS. Even though the statement is true for India, too, it is specifically important for Brazil and South Africa to ensure that the bloc puts building manufacturing capacity at the centre to create much needed jobs and enhance skills.
In some respects, the timing for South Africa and the other BRICS couldn’t be better: China’s sense of encirclement is ratcheting higher with every passing week as China’s industrial policy exposes economic tensions with the US, tensions unlikely to be resolved any time soon. [CSO commentary: The BREAK the BRICS Coalition]
This weekend’s SACU Summit: preview by SACU’s ES, Paulina Elago
Talking about intra-SACU trade, SACU secretariat executive secretary, Ms Paulina Elago, said it had grown over the past five years.”Goods exported have increased by 10.2% reaching the value of R188bn in 2017,” she said. Ms Elago said the structure of intra-SACU exports had remained relatively the same over time with South Africa accounting for most of the goods traded within SACU. She said in 2017, South Africa accounted for 71.3% of intra-SACU exports followed by Namibia (11.6%), eSwatini (9.1%), Botswana (5.7%) and Lesotho (2.3%). On imports, she said intra-SACU imports had increased by 6.9% during the same period. “The intra-SACU import bill stood at R171bn in 2017. The structure of intra-SACU import has remained relatively the same during the past five years with Botswana, Namibia and South Africa being the dominant players.” She said in 2017, Namibia accounted for 29.3% of intra-SACU imports followed by Botswana at 29%, South Africa (21.7%), Lesotho (10.5%) and eSwatini (9.5%). “This is a positive trend in terms of trade creation effect of the Customs Union but the dependency on South Africa as the dominant player has at times put the BENL Botswana, eSwatini, Namibia and Lesotho at risk of high input cost to industrial inputs.”
Nigeria manufacturing body opposes African Free Trade Area (Bloomberg)
Nigeria’s main manufacturing body said it will oppose plans for an African free trade area until the government has done more studies on its impact. “When they open our borders for all manner of products to come into this country, most of our industries will be out of business,” Frank Jacobs, president of the Manufacturers Association of Nigeria, told reporters in Lagos, the commercial capital, on Tuesday. “We will continue to oppose it until the right thing is done.” [Commentary byOlu Fasan: Nigeria is Janus-faced on trade, but can’t have it both ways]
pdf Tanzania Diagnostic Trade Integration Study Update 2017 (2.10 MB) (World Bank)
The Tanzania Diagnostic Trade Integration Study 2017 identifies priority actions in support of the country’s strategy to deliver broad-based growth through trade integration. The study seeks to (i) take stock of the progress in implementing the action matrix adopted in the DTIS 2005; (ii) provide an in-depth focus on agribusiness, mining, and tourism; (iii) identify obstacles to the realization of the full development potential of agriculture and tourism in Zanzibar; and (iv) prepare an updated action matrix. While the report focuses on agribusiness, mining, and tourism, it more broadly addresses the issues of regional integration, trade facilitation, small-scale trade, and gender. Extracts:
The regional trade potential has not been fully exploited. Trade with the EAC has remained relatively low for an economic union. In 2015, Tanzania sourced only 4% of its imports from within the EAC and exports accounted for 10.5%, growing slower compared to other regions (from 3% to 8% to the rest of Africa, between 2010 and 2015). There is therefore considerable potential for increasing exports to neighbouring countries, but the relatively low degree of trade integration reflects the continued high trade costs.
Trade costs have been a major impediment. High costs divert trade to informal channels. A substantial portion of Tanzania’s trade goes unrecorded. Comparing mirror trade data (that is, the value of Tanzania’s exports to EAC partner countries’ import data for the same products) reveals substantial gaps, indicating that informal exports from Tanzania to partner EAC countries could account for as much as $262m. Other estimates show that approximately 500,000 tons of maize were informally exported to Kenya in 2014, amounting to more than $150m in value. This is in addition to the dozens of thousands of metric tons of other crops, such as rice, dry beans, coffee, and cloves that are regularly exported to neighbouring countries through informal channels. This ‘missing trade’ has a disproportionately negative impact on small farmers and traders, and women in particular.
Cote d’Ivoire: IMF staff report for the 2018 Article IV Consultation
The medium-term outlook is robust. Growth is expected to average around 7% over 2018–23. On the supply side, this projection is supported by a pick-up of the industry (particularly mining and energy production) and services (including telecommunications and construction) over the medium term. Concerning demand, key drivers of growth are projected to be a rebound of private consumption and investment in the near term and rising net exports in 2020 and beyond. The current account deficit is expected to widen to around 3% of GDP in 2018-20 reflecting a decline in primary agriculture exports and an increase in imports of consumption and investment goods, and gradually narrow over the medium term, with industrial exports gathering strength and the services deficit stabilizing. Inflation is projected to remain below 2%, reflecting the projected low inflation in trading partners.
Gabon: IMF completes review mission
The mission expressed concern about weak program performance, substantial fiscal slippages, and disappointing progress on structural reforms. The overall fiscal deficit (cash basis) declined by about 3% of GDP, broadly in line with program projections. This helped contain public debt (including domestic arrears) at around 63% of GDP. But the composition of the adjustment was less than optimal as it relied on a large drop in public investment, which can have a negative impact on growth. There was also insufficient progress to contain current spending (wages and salaries, transfers, subsidies and special accounts) and weak non-oil revenue collections. Progress to clear domestic and external arrears was also slower than expected, and many important structural reforms have been delayed or not implemented as planned. [The Central African Backbone project: central pillar of the digital revolution in Gabon]
EU’s Trade and Investment Barriers report: EU removes record number in response to surge in protectionism
The annual pdf Report on Trade and Investment Barriers for 2017 (1.83 MB) released today, shows that the European Commission has eliminated the highest number ever of trade barriers faced by EU companies doing business abroad. European exporters reported a major increase in protectionism in 2017. The report also shows that 67 new barriers were recorded in 2017, taking the total tally of existing obstacles to a stark 396 between 57 different trading partners around the world. This confirms the worrying protectionist trend identified in previous years. China displayed the largest increase in new barriers in 2017, followed by Russia, South Africa, India and Turkey. The Mediterranean region also showed a notable rise in barriers for EU companies. The nine countries with the highest number of trade barriers still in place are all G20 economies. Examples of barriers eliminated in 2017: [Comments on South Africa, p17-18: Though South Africa has not been a focus of previous reports, an increasing number of protectionist barriers affecting trade and investment are being put in place. The country resorted to four new barriers in 2017, bringing the overall barrier count to eight.]
UK-Africa Strategy Post-Brexit: speech by Minister for Africa, Harriett Baldwin
We are really extending our reach across Africa. So far this year the UK has opened new posts in Lesotho and eSwatini, Mauritania and Chad, and there will be more to come. The vision is that at the end of this process we will have more offices across Africa than any other European country. Global Britain is open, inclusive and outward facing, committed to playing a leading role on the world stage. Leaving the European Union does not mean stepping away from our global responsibilities – quite the opposite. And this is why we are stepping up our partnerships across Africa, our commitment to the long-term success of African nations and our support to the future hopes of millions of young people.[Note: The speech was delivered at today’s British Foreign Policy Group event] [Douglas Gibson: Brexit presents an opportunity of a lifetime for SA]
China-Africa Infrastructure Cooperation Forum in Nairobi (Xinhua)
Kenya on Monday hosted the China-Africa Infrastructure Cooperation Seminar amid calls for enhanced ties with Beijing to boost modernization of roads, ports, railways and telecommunication networks in Africa. The two-day meeting was organized by Chinese Embassy in Kenya, Kenyan Ministry of Transport and the African Economic Research Consortium. The forum focused on the Mombasa-Nairobi SGR project was the sixth one to be held in the continent ahead of FOCAC summit in Beijing in September. Zhou Yuxiao, China’s Ambassador for Affairs of the Forum on China-Africa Cooperation said: “In cooperation with Africa, China attaches great importance to the economic and social benefits of the projects. It advocates that large infrastructure construction and industrial development should be planned and carried out in parallel so as to make them mutually reinforcing and strengthen Africa’s capacity for sustainable and self reliant development.”
Nigeria: Customs to deploy drones to check rice smuggling (Punch)
The Nigeria Customs Service on Monday vowed to deal ruthlessly with those involved in the smuggling of prohibited items, particularly rice, saying that it was working with the Nigerian Air Force to deploy drones for border surveillance. The Deputy Comptroller-General, Enforcement, Investigation and Inspection, NCS, Aminu Dangalidima, said once the service was able to reduce the activities of smugglers, it would result into improved revenue for the government. “We will be able to boost revenue generation once we are able to block leakages,” he noted. The Federal Government had last week stated that it would shut Nigeria’s land border with a neighbouring country in few days’ time in order to halt the smuggling of rice into the nation.
Tuesday’s Quick Links: ECOWAS, Israel agree on $1b renewable energy project Zimbabwe, Zambia agree to speed up Batoka project Angola’s state budget for 2019 will be different from every previous one: Minister of Finance Gregory Krosten: Whither remittances in the Nigerian economy? Counterfeit trade on the agenda of ACP negotiations IMF on Euro 2.0: Past, present, and future of Euro area integration IMF report on the globalization of farmland: theory and empirical evidence The devil is in the details: growth, polarization, and poverty reduction in Africa in the past two decades |