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SA companies could boost exports to EU by R350bn a year, research shows (Daily Maverick)
South African companies are missing out on R350-billion a year in export opportunities to the European Union (EU), new research shows. Under the Economic Partnership Agreement (EPA), which it signed with South Africa and five other southern African countries in 2016, the EU allows 96.2% by value of SA exports into its market duty-free and 2.5% under reduced tariffs. Conversely, South Africa and the other Southern African Customs Union members allow 74.1% of EU exports into their market duty-free, and 12.5% under reduced tariffs. The EPA has been a boon for many South African exporters.
Roberto Cecutti, the head of trade at the EU embassy in Pretoria, told a media briefing last week that in 2021 SA’s exports to the EU increased by 30% and SA recorded its first trade surplus – of some R15-billion – with the EU since the first free trade agreement between SA and the EU began in 2004. He noted that SA exported a lot more value-added goods to the EU than to the rest of the world. About 33% of SA exports to the EU were in manufactured goods, including vehicles, compared with just 13% of those categories as a share of SA’s exports to the world as a whole.
United front for South Africa on freight rates (Fruitnet)
A steep rise in shipping rates is causing mayhem among fruit growers and exporters around the world. In South Africa these increases, which are regarded as unreasonable, unacceptable, and short-sighted, are uniting fruit growers, exporters and logistics service providers as never before. Sources have said that industry stakeholders are united in their view that shipping lines should be aware of the risks they are placing on the long-term sustainability of exports. These sources believe that shipping lines are working from incorrect assumptions in pursuing increases in freight rates.
South Africa’s citrus industry has already stated that the recent increases represent the single most important threat to the long-term sustainability of the industry.
Shipping lines have argued that despite higher freight rates they are still getting bookings from exporters. “They assume that this is because it remains financially viable for growers and exporters to ship at the higher freight rates,” commentators have said. “The reality is that this is not the case. 2021 was already an extremely difficult year for many in the industry. If one notes what is going on around you, you will see that many businesses have gone into business rescue or liquidation. Many companies survived to 2022 based on the reserves they had built from 2019/2020, in the hope that things would improve.”
South Africa’s unemployment rate dips to 34.5% (Daily Maverick)
The good news is that the unemployment rate is falling. The bad news is that it is still more than 34% against the backdrop of inflation as winter sets in. The latest Quarterly Labour Force Survey, from which the numbers are derived, also showed that the unemployment rate by the wider measurement – which includes discouraged jobseekers – fell to 45.5% from 46.2% previously. “These results indicate that 370,000 jobs were gained between the fourth quarter of 2021 and the first quarter of 2022,” said Stats SA.
However, there were job losses in Private Households (186,000), Finance (72 000), Construction (60,000) and Agriculture (23,000). The total number of people employed was 14.9 million in the first quarter of 2022.”
“With expectations of decent citrus, summer grains and oilseeds harvests, and fairly good activity in other subsectors of agriculture, we believe primary agriculture employment could remain at these robust levels this year,” said Wandile Sihlobo, Chief Economist at the Agricultural Business Chamber, in a note on the data.
Namibia Pushes for Improved Bilateral Relationship with Nigeria (This Day)
Namibia has expressed its willingness to extend bilateral relationship with Nigeria. According to the country, it would use the hosting of the fifth session of the Namibia-Nigeria Joint Commission of Cooperation holding in Windhoek in August, 2022, to push for improved bilateral relationship between the two African countries. Addressing a press conference in Abuja, yesterday, the High Commissioner of Namibia to Nigeria, Mr. Humphrey Geiseb, said the present volume of trade between the two countries needed to be improved.
“In 2000, Namibia and Nigeria established the Namibia-Nigeria Joint Commission of Cooperation. In August 2022, Namibia will host the 5th Session of this Joint Commission to elaborate on mutually beneficial projects between Namibia and Nigeria. “This Joint Commission has stood the test of time and has provided a platform to execute great projects between our two countries.”
Geiseb added: “Presently, Namibia exports salt worth around $10 million a year to Nigeria and also some electronics. A factory to build Namibian electronics in Lagos is under way. Two Nigerian companies – Premier Charcoal in Outjo and King Charcoal in Walvis Bay – are operating in Namibia owned by Nigerian investors.”
He noted that: “There is tremendous potential for increasing trade. Definitely, Namibian producers can still export Salt and hopefully in future, Namibian grapes, dates, wine, and once restrictions are lifted, Namibian beef and lamb.
Namibia, USA to explore avenues to grow businesses further at upcoming annual trade mission (Namibia Economist)
The Ministry of Industrialisation and Trade (MIT) together with the Embassy of Namibia in Washington, DC, will host a USA delegation from 06 to 10 June. The visit is part of the Annual Trade Mission to Namibia headed by the Ambassador, Margaret Mensah-Williams. According to a statement, MIT is preparing to receive a multi-sectoral business delegation from the USA to explore and follow up on possible business opportunities locally. “The gathering aims to yield tangible results where the American businesses can explore the diverse opportunities existing in Namibia,” the MIT added. “We have an investment culture and we urge all local businesses to take advantage of such opportunities and grow opportunities at home,” the ministry added.
Meanwhile, the mission will promote trade and investment in the following sectors: Education; Mining and Mineral Beneficiation; Logistics and Container Terminal; Agriculture and Agro-processing; Low-cost Housing; Tourism and Hospitality; Water and Power Generation; Creative industry and Culture; Pharmaceutical and Medical supplies, including Herbal Medicine; Marine Resources; Natural Cosmetics, etc.
Namibia solidifies intent to be logistics gateway - Third and last section of the Windhoek to HKIA road gets off the ground (Namibia Economist)
The Minister of Works and Transport, John Mutorwa on Monday took part in the official groundbreaking ceremony for the upgrading to dual carriageway standards of Phase 2B of the Windhoek to Hosea Kutako International Airport road.
The project which forms part of Namibia’s regional trunk routes includes the construction of the 21.3 kilometres of the dual-carriage freeway, three interchanges, two river bridges and drainage structures.
“Namibia is positioned as a gateway for imports and exports to and from landlocked neighbours in the SADC region and the Chinese government is assisting us with strides in expanding our road network to achieve the goals for transport as set out in Vision 2030,” he said.
IMF Staff Completes 2022 Article IV Mission to Botswana (IMF)
“The 2022 Article IV consultation discussions take place in a context of high volatility in global commodities, and COVID-19 outbreaks in Botswana’s key trading partners. Commodity prices have surged following the Russian invasion of Ukraine. While higher demand for and prices of diamonds could result in some windfall for Botswana, higher food and energy prices will weigh on fiscal and external balances and threaten food security and energy affordability for the most vulnerable populations. At the same time, COVID-19 outbreaks in China, supply chain disruptions, and tighter financial conditions are projected to reduce global growth to 3.6 percent in 2022, from 6.1 percent in 2021.
Botswana’s economic recovery from the pandemic should continue into 2022 amid higher prices and demand for diamonds, good rainfall in some parts of the country and increasing international tourist arrivals. Growth is projected at 4.3 percent in the current year. Robust diamond production, favorable terms of trade, improvements in tourism, and smaller portfolio outflows should further strengthen Botswana’s external position. Buffers, particularly those held by the government, should continue to recover.
Flower exporters eye sea freight as air costs shoot up (Business Daily)
The high cost of shipping horticultural produce by air is now pushing traders to adopt sea freight which is relatively cheaper. Freighters from the Jomo Kenyatta International Airport (JKIA) are charging $5.8 for a kilo of cargo, forcing exporters to seek other alternative means. The charges, argues chief executive officer of Kenya Flower Council Clement Tulezi, have made produce from countries like Ethiopia sell at competitive prices in the world market because of lower freight rates. For instance, Ethiopia is charging $2.5 for a kilo of produce shipped to the world market, making goods ferried by the carrier cheaper in the world market. The sea freight is projected to lower the cost to at least $2.8 a kilo. On Monday, the Kenya Flower Council (KFC) and the Embassy of the Kingdom of the Netherlands signed a framework of cooperation that is set to accelerate the shift to sea freight for perishables in Kenya.
“It is however important to incorporate the supply chain requirements of perishable goods in new infrastructures. For instance, Standard Gauge Railway (SGR), ports, container depots as well as realising efficient customs clearance procedures of perishable goods leaving Kenya,” said the Flower Council.
Kenya: Current account deficit widens on import costs (Business Daily)
Kenya’s current account deficit as a percentage of GDP widened to 5.1 percent in April from 4.8 percent a year earlier, due to higher import costs for fuel, food and industrial goods that outweighed higher inflows from agriculture exports and diaspora remittances. The ongoing conflict between Russia and Ukraine has pushed up costs of key food items such as wheat, and also caused a jump in the price of crude oil in the international market. Oil prices, which had fallen to decades lows of $19 per barrel at the height of the Covid-19 pandemic in 2020, have now gone up to $120.Constraints in the global supply system due to pent-up demand after the easing of Covid restrictions have also increased the cost of importing goods significantly.
“The wider deficit reflects a higher import bill, particularly for oil, which more than offset increased receipts from agricultural and services exports, and remittances,” said the Central Bank of Kenya (CBK) in a market bulletin.
Horticulture exports decline by Sh2.8bn on avocado restrictions (Business Daily)
Horticulture exports retreated by Sh2.8 billion in the 12 months to April 2022, weighed down by lower avocado sales in a period when the country instituted export restrictions aimed at stopping sale of immature fruit. The latest data from Central Bank of Kenya (CBK) released yesterday shows that horticulture sales dipped to $1.04 billion (Sh121.9 billion) from $1.07 billion (Sh124.9) in the 12-months to April 2021.This was in contrast to other agriculture exports, where tea exports rose from $1.2 billion (Sh140 billion) to $1.22 billion (Sh142.4 billion), while coffee sales rose by $41 million (Sh4.8 billion) to $278 million (Sh32.5 billion). The increase in receipts from tea exports reflects improved prices attributed to demand from traditional markets, the CBK said. “We understand there were some problems in exports of avocados, which gave rise to this decline instead of the increase that we were expecting. But that problem has now been resolved, and we understand that now the exports are finding their way to the market,” said CBK governor Patrick Njoroge in a briefing.
The CBK also noted that manufacturing exports had underperformed in the period against expectations of much higher growth.
NEPC eyes $2.7tn African market through e-commerce (Punch Newspapers)
The Nigerian Export Promotion Council, NEPC, is targeting the $2.7 trillion African market through the instrumentality of e-commerce. Speaking at the launch of Agogo Africa supported by NEPC and African Union on Tuesday in Abuja, the Chief Executive Officer, NEPC, Dr Ezra Yakusak, said e-commerce had become a big industry, citing a report by an online platform, ecommercedb.com, which said that Nigeria was ranked 35th largest market for e-commerce globally and recorded a yearly growth of 42 per cent. The report, according to him, also noted that 26 per cent of Nigerians bought products online as at 2020.
He said e-commerce was one of the fastest growing industries in the global economy, noting that the estimated yearly growth was put at 23 per cent and the industry was projected to hit $27 trillion by the end of this decade.
DRC needs to dig deeper in mines for electric cars battery minerals (The East African)
Electric vehicle (EV) sales hit a record high in 2021, accounting for 10 percent of all vehicles sold globally and putting a strain on the scarce minerals — cobalt, lithium and copper — needed to make their batteries. A report by Paris-based International Energy Agency (IEA) released on May 23 shows that 6.6 million electric vehicles were sold in 2021 bringing global sales to 16.5 million.
Pressure is now on mineral-rich countries such as the Democratic Republic of Congo (DRC) to help meet growing demand for copper, cobalt and lithium, critical in producing electric vehicle batteries as sales rise in a push to meet the global net zero ambitions. “The rapid increase in EV sales during the pandemic has tested the resilience of battery supply chains, and Russia’s war in Ukraine has further exacerbated the challenge,” IEA said in the report.
The DRC, which produces about 68 percent of the world’s cobalt annually, and over 1.8 million tonnes of copper (the fourth-largest in the world) will now have to dig deeper into its mines to meet the growing demand.
Consider public interest in tariffs review —Chief of Staff implores PURC (GhanaToday)
The Chief of Staff at the Presidency, Madam Akosua Frema Osei-Opare, has advised the Public Utilities Regulatory Commission (PURC) to consider the public’s interest in its impending tariffs review. Madam Frema-Opare said that even though there was the need to strengthen and regulate utility companies to become financially viable, there was the need to also consider the economic challenges facing Ghanaians amidst its multiyear tariffs review.
Sudan’s trade balance deficit nearly tripled in the past year (Radio Dabanga)
The deficit in the trade balance for the first quarter of this year rose to $1.22 billion, an increase of nearly two times over the same period last year when the deficit was $477 million, further threatening Sudan’s economy. According to a report by the Central Bank of Sudan, exports in the first quarter amounted to $1.39 billion and imports $2.62 billion.
In an interview with Radio Dabanga’s Sudan Today programme, Professor of Economics at El Nilein University in Khartoum Dr Hasan Bashir said that a significant rise in the trade balance deficit despite the end of the Covid-19 pandemic is an indication of the stifling crisis in the Sudanese economy. Dr Bashir explained that export volumes could have been 10 times the size of current exports and highlighted the continued smuggling of large quantities of gold from the country.
African trade news
Trudi Hartzenberg is the Executive Director of the Trade Law Centre (tralac). She is responsible for development of the tralac strategy, resource mobilisation and engagement with African governments, regional, continental and international organisations. She currently serves on the WTO Chairs Advisory Committee and is a member of the Committee for Development Policy of the United Nations Economic and Social Council (ECOSOC). She supports women’s economic empowerment: focusing on women traders in national and regional business associations, and also heads up SheGovernsTrade – an empowerment programme for young women trade policy makers. Her research areas include international trade, competition policy, industrial development and Africa’s integration agenda. She has a special interest in capacity building. She designs and delivers academic and tailored short courses, a broad range of trade-related topics, investment, competition policy and industrialisation.
Rwabwogo: We Must Rebuild Intra-Africa Trade Linkages to Cease Being ‘Supermarket for Products of the West’ (Softpower)
Odrek Rwabwogo, Special Presidential Advisor for Special Duties and Chairman of the Presidential Advisory Committee on Export and Industrial Promotion, has delivered a keynote address at the Uganda-DRC Business Summit currently ongoing in the Congolese capital Kinshasa. In his speech delivered Monday at Fleuve Hotel, Rwabwogo interested the over 200 participants in the investment opportunities in Uganda. He narrated how Uganda and DR Congo have traded with each other for so many years. “…That trade was so successful that many tribes joined and opened up the country to foreign trade.”
African Development Bank financing for Kenya roadway boosts local economy and regional integration (AfDB)
Kenya is making rapid progress in the construction of its part of the Great Trans-African highway that runs from Cairo in Egypt to South Africa’s Cape Town. The 84km Kenol-Sagana-Marua highway, which runs through central Kenya, is being upgraded from a single lane road to a dual carriageway. It is expected to be completed in six months, two years earlier than scheduled. The roadway connects Nairobi with major commercial and agriculturally important towns in central, upper eastern and northern Kenya. Plans for this section of the Great Trans-African highway began nearly 40 years ago. However, construction began only after the African Development Bank stepped in in 2019 to finance the project.
Africa’s resilience to economic shocks requires domestic solutions — Prof Urama (BusinessGhana)
Professor Kevin Chika Urama, Vice President for the Economic Governance and Knowledge Management Complex, African Development Bank (AfDB), has asked African Governments to focus on building their economic fundamentals through domestic solutions. This includes increasing domestic revenue mobilisation, building strong internal relationships and trade, and patronising made in African products. In addition, African countries must boost productivity and shift from being mainly producers of raw materials, create and indigenous stabilisation Fund and address leakages in its public financial management systems.
Prof Urama, who is also the Acting Chief Economist at AfDB, said, these would make African economies resilient against global shocks like the COVID-19 pandemic, Russia-Ukraine conflict and future shocks.
It would also make Africa, which is the second-largest and second-most populous continent in the world, have sustainable development, create jobs, particularly for its teaming youth and reduce poverty and inequalities.
UN Global Compact launches new hub for Africa (Africa Renewal)
The Africa Regional Hub will mobilize, accelerate and scale-up the impact of responsible business across Africa and drive forward the Africa Strategy 2021-2023 of the UN Global Compact.
With 1.3 billion people and a combined GDP of $3.5 trillion dollars, Africa is the world’s biggest growth market. African businesses are primed to play a pivotal role in the corporate sustainability movement. The UN Global Compact’s Africa Strategy 2021-2023 provides a roadmap to galvanize large and small businesses across Africa to uphold the Ten Principles. The UN Global Compact’s principles-based approach means that businesses operate in ways that, at a minimum, meet fundamental responsibilities in the areas of human rights, labour, environment and anti-corruption.
Strengthening resilience in nutrition and food security in Africa (Africa Renewal)
For too long, nutrition, food security, conflicts, climate change, ecosystems and health have been treated as separate issues. But these global challenges are deeply interconnected. Conflict creates hunger. The climate crisis amplifies conflict. Economic insecurity is heightened by the pandemic and by inequalities in resources allocated for recovery. These problems are systemic; and they are getting worse. Decades of progress on hunger are being reversed. After improving steadily in all regions between 2000 and 2016, hunger has sharply increased in recent years. Over 281 million Africans – one in five – were undernourished in 2020. Sixty-one million African children are affected by stunting, which can impact their physical and mental health throughout their lives. As always, women and girls are the most affected. When food is short, they are often the last to eat; and the first to be taken out of school and forced into work or marriage.
The Three Issues That Will Make or Break the Prosper Africa Initiative (Carnegie Endowment for International Peace)
The U.S. government’s Prosper Africa program, launched in 2019, aims to double two-way trade and investment between the United States and African countries and, in doing so, to put a new face on American foreign policy in Africa. Despite the initiative’s embrace by two separate administrations, it has so far been slow to live up to expectations. The Prosper Africa Act, a draft piece of bipartisan legislation put forward in the U.S. House Foreign Affairs Committee, now languishes in Congress, overshadowed by other crises and attracting little attention. Allowing the legislation to expire is a mistake. To help ensure its success, the Prosper Africa Act’s sponsors should address three key issues around its scope, strategic positioning, and diaspora engagement.
Today’s shifting geopolitical landscape makes the goals of Prosper Africa more important than ever before. U.S.-Africa relations have historically focused on humanitarian and security concerns, but Africa’s major economies have grown rapidly and should play a much broader and more strategic role in U.S. foreign policy.
Recent disruptions in the global economy further reinforce the salience of Prosper Africa’s objectives. The increased financial flows and business engagement it envisions could be pivotal in helping African countries recover from massive economic shocks brought on by the coronavirus pandemic and by Russia’s invasion of Ukraine. They could also be essential for building infrastructure and public services to support economic transformations underpinning both U.S. and African interests, including clean energy transitions.
The success of Prosper Africa may ultimately depend on how the initiative and the draft bill in Congress put forward to back it address three key issues.
China’s pivotal role in supporting post-COVID growth in Africa (White & Case LLP)
2013 marked a pivotal milestone, as China overtook the United States (US) as the largest equity investor nation into the African continent, measured in terms of new foreign direct investment. Since 2000, all the African nations (except Eswatini) have conducted formal inter-government collaboration with China through FOCAC. In his keynote speech at the 8th Forum on China-Africa Cooperation (FOCAC) summit in Senegal in November 2021, President Xi Jinping proposed that over the next four years, China and Africa should collaborate on: Fighting the COVID-19 pandemic Opening new prospects for China-Africa cooperation, expanding trade and investment, poverty reduction, strengthening cooperation on digital economies and promoting entrepreneurship by young Africans, and the development of small- and medium-sized enterprises Promoting green development in the face of climate change, working to implement the Paris Agreement and strengthening capacity for sustainable development Upholding equity and justice and promoting true multilateralism At this FOCAC summit, a “China-Africa Cooperation Vision 2035” was published that specifies nine programs across a wide range of sectors earmarked for implementation during the first three years of this initiative.
In economic terms, 2013 marked a pivotal milestone, as China overtook the United States (US) as the largest equity investor nation into the African continent, measured in terms of new foreign direct investment (FDI flows). FDI flows to Africa from the European Union (EU) countries collectively continue to dwarf those of both China and the US, though. In 2020, the top African destinations of Chinese FDI were Kenya, the Democratic Republic of the Congo, South Africa, Ethiopia and Nigeria.
Trade between China and Africa has increased steadily in recent years. China has been Africa’s largest single national trading partner for the past 12 consecutive years, although trade between Africa and EU nations collectively continues to significantly exceed Africa’s trade with either China or the US. According to the latest data released by the General Administration of Customs of China, the total bilateral trade between China and Africa reached US$254.3 billion in 2021, up 35.3 percent from 2020, and African exports to China reached US$105.9 billion dollars in 2021, up 43.7 percent from 2020. The bulk of this trade is with only five countries: South Africa, Angola, Kenya, Nigeria and Egypt.
Japan-Africa relations critical to safeguard development gains as fallout from war in Ukraine (BusinessGhana)
United Nations Assistant-Secretary General and UN Development Programme’s Regional Director for Africa Ms. Ahunna Eziakonwa highlighted the unique role government and private sector partners in Japan could play in support of African countries as the war in Ukraine generates new economic shocks across the continent. “We have never experienced a greater challenge or pressure on our ability to sustain development in Africa. Reinforced multilateralism and strong partnerships, including with Japanese government entities and private sector, will be decisive in supporting African countries’ aptitude to respond to the new economic shocks caused by the war in Ukraine, at a time when they were already reeling from the impact of the COVID-19 pandemic,” Ms Eziakonwa said. “This new crisis has direct implications including food and fuel price hikes, trade disruption, and overall macroeconomic instability, which indirectly will lead to economic stress that could trigger violent protests and unconstitutional transfers of political power, especially in already fragile regions.”
Global economy news
Trade Regionalization: More Hype Than Reality? (Harvard Business Review)
While experts have been predicting a shift away from global trade towards more regionalized patterns, recent data suggest a more skeptical take is in order: An analysis of trade data based on four different regional definition shows a clear trend toward less regionalized trade between 2003 and 2012, and no consistent trend in more recent years. Since 2004, trade flows have generally stretched over longer distances, a trend that increased during the pandemic. Looking forward, while geopolitical tensions, technological trends, and environmental concerns all have the potential to contribute to an increase in trade regionalization, other forces, such as decreased container shipping costs and the ongoing improvement of technologies that ease long-distance transactions, will continue to favor long-distance trade. When deciding whether to regionalize, leaders should focus on the economic fundamentals that have always guided such decisions.
or more than a decade, experts have been predicting a shift to more regionalized trade patterns, as companies adopt nearshoring strategies to produce goods closer to the markets where they will be sold. Many expected Covid-19 to turbocharge this trend. But recent data suggests a more skeptical take on trade regionalization. Trade flows have stretched out over longer distances, even during the pandemic. While trade regionalization may increase moving forward, we wouldn’t bet on a transformational shift from global to regional business.
Ground Handling Makes Progress Towards Standardization, Boosting Safety and Efficiency (IATA)
The International Air Transport Association (IATA) reported that the IATA Ground Operations Manual (IGOM) Portal and IATA’s Safety Audit for Ground Operations (ISAGO) are successfully driving greater standardization of ground handling processes around the world. This is particularly important for the rapid build-up of operations as COVID-19 restrictions are lifted. “IGOM and ISAGO complement each other in driving much-needed harmonization across the ground handling sector. And the boost in participation in both programs as the industry ramps up its operations is good news for both safety and efficiency. The aim of both is to reduce risk, avoid ground damage and enable standardized, sustainable operations,” said Monika Mejstrikova, IATA’s Director of Ground Operations.
“The goal is global adoption of ground handling standards. The efficiency and safety gains from global standardization have been proven throughout aviation’s development. The IGOM portal is helping achieve this by making it easier for airlines and GSPs to manage and monitor implementation of standards and to understand variances. With 69 organizations already using the portal the drive for greater standardization is getting a boost,” said Mejstrikova.
Gender equality is key to transform agrifood systems and fight hunger (FAO)
Overcoming gender inequality can play a key role in freeing the world from hunger and malnutrition, the Director-General of the Food and Agriculture Organization of the United Nations (FAO), QU Dongyu, said today amid evidence that the food security gap between men and women has widened. “Women are key actors across agrifood systems, and key contributors to agricultural and rural development,” said Qu in his address to the inaugural High-Level Dialogue, which was brought together by the Food Coalition and was entitled The impact of global crises on food security: women as key agents in transforming agrifood systems. “But if we want to build agrifood systems that benefit all people, leaving no one behind, we must overcome gender inequality,” Qu added.
The Director-General also noted that women comprise nearly half of the rural workforce in low-income countries. Yet “everywhere, rural women face gender-based constraints that limit their potential,” Qu said.
Unlocking the Triple Returns from Social, Tech and Green Jobs (WEF)
New insights and initiatives at the World Economic Forum’s Annual Meeting 2022 seek to launch a jobs recovery to strengthen resilience and dynamism in economies, businesses and societies in the midst of a turbulent outlook. Investing in education, health and care jobs can yield a triple dividend – boosting economic activity, expanding employment opportunities and generating social mobility. New modelling of the United States economy suggests that investing $1 in social jobs would yield a $2.3 return. The model estimates that $1.3 trillion in the social jobs of tomorrow could unlock $3.1 trillion in GDP returns and create 11 million jobs by 2030. These jobs include 4.2 million teaching jobs, 1.8 million jobs for personal care and service workers, and 900,000 jobs in healthcare. These are the key findings of the World Economic Forum’s new report Jobs of Tomorrow: The Triple Returns of Social Jobs in the Economic Recovery, published at the World Economic Forum Annual Meeting 2022 today.
The report finds that the associated increases in productivity, increased GDP and tighter labour markets will lead to a parallel increase in real wages. Aided by technology and better skills, the jobs of tomorrow have the potential to lift living standards globally. After more than two years of turmoil in the global economy and a continued uncertain outlook, leaders need to support workers in pivoting towards a future which works for everyone. Higher wage, higher-quality, future-ready jobs are possible and benefit companies, workers and economies alike.
As many employers and workers seek a “new normal” after the disruptions of the past few years, there is an opportunity to develop a new vision for the future of work, one that is ready for the new economy and society. Five key issues have emerged that need to be addressed to ensure better work for workers and employers alike: volatility in wages and the cost of living; divergence on the demand for flexibility; silent pandemic in well-being; an erosion of diversity, equity and inclusion gains; and the need for a reskilling revolution.
IPCC Mitigation Report, 2022: What it Implies for Developing Countries (IDN IndepthNews)
There is no doubt that climate change needs to be addressed by all countries in a concerted manner. The fact remains, however, that there is a wide variance among countries both in terms of capacity to address and culpability for the problem. Developing and least developed countries are likely to suffer disproportionately the effects of climate change. The recently released IPCC report ‘Climate Change 2022: Mitigation of Climate Change’, which is part of its Sixth Assessment Report, acknowledges this gap and unequivocally places the larger responsibility of mitigation on developed economies. While countries, rich and poor, are required to step up their mitigation efforts, reading the report from a developing economy perspective reveals that there are limitations and hindrances that these countries must overcome before they can adopt and implement the recommended measures.
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Local news
Significant strides made in creating a conducive environment for investment in SA (the dtic)
The Head of Invest South Africa (InvestSA), Mr Yunus Hoosen, has lauded success in the first phase of the work done to create a conductive environment to attract domestic and foreign investment into South Africa. InvestSA is an agency of the Department of Trade, Industry and Competition (the dtic) and hosted a session at the Protea Hotel Fire and Ice in Menlyn, Pretoria to assess progress in the Investment Climate Reform Programme.
The Programme has been running over the past 4 years and is a partnership with the dtic and the International Finance Corporation (IFC) of the World Bank Group being the main partners.
“In Competition Policy and Market Regulation, the programme produced tools to enforcement action to address cartel behaviour as well as reduced costs for customers for a range of essential services. Through this development, we have also witnessed the deployment of electronic platforms such as Bizportal and City of Johannesburg’s online construction permits system. These are pioneering e-government initiatives with the potential to have their functionalities replicated across government departments.”
The IFC’s Country Manager for South Africa, Mr Adamou Labara, said the runaway successes of the four investment conferences held in South Africa are testament to the county’s ability to articulate a clear investment proposition and deliver on investment commitments through
SA’s trade with Africa surpasses exports to EU block (SAnews)
Deputy Minister of International Relations and Cooperation, Alvin Botes, has told a sitting of the National Assembly that South Africa’s exports to Africa have surpassed those to the European Union in 2021. Botes said this when he participated in a debate on Africa Day at the Good Hope Chamber in Parliament on Wednesday. “We are committed as the South African government to work towards halving of poverty through agriculture by 2025, working amongst others, with countries such as Ghana and Morocco and in terms Malabo [Declaration] commitment five: the boosting of Intra-Africa Trade, we know that the trade figures in South Africa have increased remarkably,” he said.
Among the commitments made at the meeting was Malabo Declaration Commitment five, which speaks to African states committing to boosting intra-African trade in agricultural commodities and services – by tripling trade in this area and by fast-tracking the continental free trade area and transition to a continental common external tariff scheme.
SA leaving trade money on the table, says the EU | Fin24 (Fin24)
While the EU is SA’s biggest export market by a long way and SA benefits from a large number of duty-free items, trade relations with the EU could be exploited to far greater benefit, the head of the trade and economic section of the EU delegation to SA, Roberto Cecutti, said on Thursday. The study, which modelled products with preferential access against the potential demand globally, and particularly European countries, was conducted by consultancy Trade Advisory. It found that R350 billion worth of products had potential for export in the short term, in the medium term R280 billion, and the long term R210 billion.
In the short term, motor vehicle components and food and agricultural products held the most untapped potential. In the medium term and long term, food and agricultural products, basic iron and steel, metal products, primary agriculture, and textiles had the largest export growth potential.
The EU has an asymmetrical economic trade partnership (EPA) with the SADC region, with 96% of SA products carrying no duties with 2.5% of products restricted and 1.3% excluded from free trade. On the other side of the relationship, 13.8% of EU goods are excluded from free trade.
African market is important for sustainable growth (SAnews)
With May celebrated as Africa Month, the Coega Development Corporation (CDC) has identified the rest of the African continent as an important market for sustainable growth. This is consistent with its strategic plan 2020-2025, but also as part of the African Continental Free Trade Area (AfCFTA) agreement. “In the next financial year, the CDC will focus on fast-tracking the implementation of projects in the Central African Republic (CAR) and Zimbabwe, whilst marketing its services to increase the portfolio of clients,” CDC Programme Director Idriss Mouchili said on Wednesday. The Department of Trade, Industry and Competition (the dtic) in the Special Economic Zone (SEZ) Strategic Framework 2020-2030, has identified cross-border exchanges with the rest of Africa as a key pillar of the implementation of reconfiguring and expansion of existing SEZs.
The CDC has expanded its non-SEZ services to other markets in countries that include Zimbabwe, Nigeria, Cameroon, Central African Republic, Democratic Republic of Congo and Senegal under the Coega Africa Programme (CAP). Through its African Trade and Investment Solutions Strategy, the CDC is championing the country’s renewed push for business exchanges between South Africa and the rest of the continent.
US looks beyond delayed free trade deal in commercial ties with Kenya (Business Daily)
The US government is looking beyond a delayed trade deal with Kenya to expand commercial ties between the two countries amid Nairobi’s mounting frustration with Washington’s slow pace to conclude the deal. In a new report submitted to the US Congress by Joe Biden’s top trade diplomat Katherine Tai, the US government revealed it would pursue “other means” of deepening trade engagements with Kenya in the absence of a free trade agreement (FTA). “(We will) engage with Kenya to deepen bilateral trade, potentially through an FTA or other means, to spur Kenyan development and promote more equitable, worker-centric trade with Kenya,” said the United States Trade Representative Office (USTR) in the report seen by Business Daily outlining its objectives for this year.
The US government and Kenya early this month held another round of trade talks, which raised hopes of a fresh direction after the Biden administration froze Trump-era negotiations on the free trade agreement.
Increasing UK–Kenya trade and investment in the horticulture sector (GOV.UK)
The Kenyan horticultural sector exports many high value products, such as vegetables, fruit and flowers, globally, including to the UK. The sector is vital for Kenyan smallholder farmer incomes, jobs, and foreign exchange, which support economic growth. As a major trading partner for Kenya, the UK imports Kenyan vegetables and flowers and supplies of finance and high-tech equipment. This 2-way trade is vital to Kenya’s horticultural sector, but it has been declining steadily since 2012.
Despite previously stagnant UK retailer prices and rising freight costs, Kenyan producers have struggled to deliver consistent quality and high volumes competitively. Poor trade facilitation, depreciation of the pound and uncertainty over post-Brexit food standards requirements have further reduced their market share.
Similarly, UK exports to the Kenyan horticultural sector including eg farm machinery have declined after competition from India, China, and Turkey. This is made worse because competitive credit terms have not been available for Kenyan importers.
New Financing to Improve Safety, Climate Resilience and Capacity of Tanzania’s Roads and Regional Airports (World Bank)
A new International Development Association (IDA*) credit of $550 million that will allow Tanzania to unlock critical road and airport bottlenecks, enhance its role as a transit country, and leverage more effectively its national parks for tourism. The Tanzania Transport Integration Project (TanTIP) aims to improve the safety, climate resilience, and capacity of key road corridors and regional airports. It will also help improve the capacity of relevant transport sector institutions to plan for and manage the sector. “Much of Tanzania’s development success over the past decade has been predicated on the critical advantages of its strategic maritime location, its rich and diverse natural resources, its socio-political stability, and its rapidly growing tourism industry,” said Mara Warwick, World Bank Country Director. “Investments under this project will contribute to wider government efforts to improve the integration of Tanzania’s economy and its connection with its neighbors and global markets, while ensuring adaptability of the infrastructure.”
Uganda: Microfinance reform comes to a dead end (Monitor)
A tiny sliver of lawmakers on the Budget Committee have objected to the decision to appropriate Shs35b to the Microfinance Support Centre (MSC) in the Budget for Financial Year 2022/2023. In a minority report, the five lawmakers claim that “MSC operations are marred with massive irregularities and without adequate supervision.” They go on to add that “it has veered off its operational guidelines.’’
“Continued budget allocation to the entity exposes the scarce public resources to the risk of further abuse,’’ the report reads, naming 10 Saccos that scooped huge sums anywhere between Shs700m and Shs3b.
Ghana and Uganda ban grain and food exports (DW)
Ghana and Uganda are among several African countries banning the export of grains and other farm produce, with the latter imposing high taxes to prevent food exports to neighboring countries. The Ghanian government has extended a ban on grain exports. A temporary ban on exporting maize, rice, soybeans, and other grains — which took effect in September last year — will now run until September 2022. The original ban was put in place to ensure food security and increase local poultry and livestock production. The extension of the ban comes as grain prices soar, partly because of Russia’s war on Ukraine. But some farmers are unhappy with the extended ban, saying they would get better prices if they could sell their crops outside of Ghana. So they want the government to lift it.
Zambian MPs want drugs be manufactured in Africa (IPPMedia)
A ten-member delegation of Zambian legislators just through a visit to Tanzania made this appeal after a tour of Kairuki Pharmaceuticals Industry Ltd (KPIL) at Zegereni in Kibaha, Coast Region, at the weekend. Heading the team was Dr Christopher Kalila, acting chairperson of the standing committee for Health in the country’s legislature, who remarked shortly after the tour that a strong private sector has immense potential of playing a decisive role in helping make the pharmaceutical subsector more high-tech. This would fast-track investments, improve the production and distribution of drugs while cutting production costs, he stated.
“If African countries can produce medicinal drugs locally, they will have greater capacity to transport and reach their people faster and more easily, especially during pandemics like Covid-19,” he asserted. He remarked that Tanzania was leading the way in the Southern African Development Community (SADC) zone in “laying the ground” for enhanced local production of pharmaceuticals.
Border reopening: Importers, manufacturers groan as Benin imposes N9m levy on transit goods (Daily Sun)
Despite the recent decision of the Federal Government to reopen additional four land borders, Nigerian importers and manufacturers are still forced to pay over N9 million levy on transit goods by the Benin Republic. This development has made it difficult for manufacturing firms that engage in cross-border trade to freight their products to the neighbouring countries, especially to Ghana through the Seme border corridors.
However, a source at the Manufacturers Association of Nigeria (MAN) disclosed that Nigerian manufacturers are made to pay the N9 million mandatory transit levy per truck, hence, any truck that refuses to pay would not be allowed to go through the Benin border despite Nigeria being a signatory to the ECOWAS Trade Liberalisation Scheme (ETLS).
AfDB to reduce wheat importation in Nigeria by 40% in 2023 (Farmers Review Africa)
The African Development Bank (AfDB) is set to reduce the importation of the wheat in Nigeria by 40% by 2023.
According to the Ms Beth Dunford, AfDB’s Vice President, Agriculture, Human and Social Development, the mission will be achieved through the wheat production technology being supported by the Bank in Nigeria, that aims to boost wheat production in the country. According to Dunford, the technology is presently being used in Nigeria, where it is being cultivated on 87,000 hectares, with the potential to expand to 250,000 hectares this season. She stated that the Bank was now trying to determine how much of the money will be awarded to each country, emphasizing that the fund was open to all countries on the continent. The assistance aimed at smallholder farmers would help them increase production.
“This is the basis of the 1.5 billion dollars Africa Emergency Food Production Facility that was just approved by the Board. This facility will be supporting the African government to reach 20 million farmers with improved technologies like the heat-tolerant wheat to produce 38 million tonnes of food on the continent,” she said.
Djibouti identified its priority sectors in the context of the AfCFTA (UNECA)
The ministry of trade and tourism of Djibouti in collaboration with ECA validated its national strategy for the implementation of the African Continental Free Trade Area (AfCFTA) on 9 May 2022 in Djibouti.
Mr Mohamed Warsama Dirieh, Minister of Trade and Tourism, said “The willingness expressed by the President of the Republic H.E. Ismael Omar Guelleh through our accession to the AfCFTA comes at a crucial time marked by the socio-economic setbacks that our countries are experiencing due to the COVID-19 pandemic but also the ongoing financial, economic and food shocks.” He further added: “Despite the challenges, the strategy with a priority action plan should allow our country to analyse in detail the tasks to be accomplished to take advantage of the AfCFTA.”
Mr Souleymane Abdallah, Economic Affairs Officer of the ECA, emphasised the need to pay particular attention to supply-side constraints, which have also been important non-tariff barriers to intra-African trade. “A key element is the lack of investment in infrastructure and logistics that will facilitate market access. This brings us back to the imperative of mobilizing resources to finance investment on the continent” he noted.
Egypt plans to double exports to $100 bln in next 3 years: PM Madbouly (Al Arabiya English)
Egypt plans to double its exports to $100 billion within the next three years, Egyptian Prime Minister Mostafa Madbouly told Emirates News Agency WAM on Sunday. “We are working to increase and double exports to bring Egypt’s exports to more than $100 billion over the next two or three years,” the Egyptian Prime Minister said on Sunday. Madbouly’s comments come after he visited the United Arab Emirates on Saturday to meet with his Jordanian counterpart Bisher al-Khasawneh and the UAE President Sheikh Mohamed bin Rashid to launch the ‘Industrial Partnership for Sustainable Economic Growth.’
Freight transport on the Douala-Ndjamena Corridor fell 10% YoY in 2020 (Business in Cameroon)
Throughout 2020, 900,000 tons of goods transited on the Douala-Ndjamena corridor. Compared to a year before, the volume is down by 100,000 tons or 10%. In a recent note, the Ministry of Transport revealed that this decline, which is due to the Covid-19 pandemic, has broken a growth dynamic observed since 2018. During that year, the document says, 800,000 tons of goods transited the corridor. The number then grew to one million tons in 2019, before dropping to 900,000 tons in 2020.
According to the World Bank, the Douala-Ndjamena corridor “accounts for 35% of the GDP of the two countries and serves 20% of the population of Chad and 35% of that of Cameroon. However, transporters often complain about police harassment due to the high number of checkpoints where they are forced to pay bribes. Also, all these controls delay the flow and fluidity of transport on this road.
To facilitate the traffic, Cameroon has decided to remove 39 irregular checkpoints of the 66 identified on its territory. This will leave 27 regular mixed checkpoints.
African trade and economy news
African governments tasked to look within the continent in their bid for transformation (BusinessGhana)
As part of efforts to boost trade in Africa, stakeholders are tasking African governments to look within their countries and the continent as a whole in their bid for economic transformation. It is for this reason that these industry players are organizing the ‘Kwahu Summit in Africa’s prosperity to provide the platform for various African Heads of state, business leaders and other prominent actors to chart actionable steps towards realizing the objectives of the African Continental Free Trade Area (AfCFTA). Sub-Saharan Africa’s success in the global market rests on deepening regional integration to scale up supply capacity and build regional value chains. The establishment of the Africa Continental Free Trade Area presents opportunities to boost intra-African trade, strengthen the complementarities of production and exports, create employment, and limit the impact of commodity price volatility on the participants. It is for this reason that the Kwahu Summit on Africa’s Prosperity is being organized under the theme ‘AfCFTA: From Ambition to Action, Delivering Prosperity through Continental Trade’.
Pan-African integration has made progress but needs a change of mindset (The Conversation)
This year’s celebration of Africa Day provides another opportunity to assess how far continental integration has progressed. Integration would mean a truly united Africa – either a federalist “United States of Africa” or the African Union (AU) exercising binding powers over member states. At present the AU merely serves as a platform for coordinating the interactions of its 55 member states. Although some progress has been made, more needs to be done to achieve the goal of integration.
Member states need to move beyond paying lip service to unity, and empower critical AU organs. This requires a shift in mentality. States need to appreciate the need to sacrifice some autonomy for common socioeconomic and political gains. Lacklustre commitment to continental integration is connected with Africa’s peripheral position in global dynamics.
Why World Bank is pushing against subsidies in E. Africa to deal with crises (The East African)
Samuel Munzele Maimbo, the World Bank director for development finance, spoke to Nelson Naturinda on how the bank is helping regional economies deal with global crises. There has been an outcry over high commodity prices. Countries such as Kenya, Rwanda and Tanzania have given economic subsidies for fuel but the World Bank is reported to be against these.
Context matters. We must consider the state of the global economy. Global economic growth has been declining from 5.5 percent in 2021 to 4.1 percent currently.Covid-19 destabilised the economies of developing countries that have lost a lot. On top of that, the war in Ukraine has taken wheat from Ukraine and Russia off the market.Any government thinking about a response has to look at short-term and long-term needs. Short-term needs could be food and fuel and long term needs would be education.
East Africa has a lot to do to balance trade with the EU (Quartz)
Member states of the east African trade bloc will have to work on a number of requirements that they are scoring low if they are to fully benefit from European Union’s 447 million market. During a workshop organized by the Stockholm Environment Institute (SEI) and the East African Science and Technology Commission, it emerged that the eight members of the East African Community are showing progress but are still unable to erase critical trade inhibitors. A scoping report presented by SEI disclosed that the bloc is struggling with job creation, taming corruption, climate resilience, innovation, infrastructural development, attracting foreign direct investment and controlling currency volatility.
“On average, east Africa is scoring low in the EU and Carbon Border Adjustment Mechanism (CBAM) policy indicators for macro economy, environment, social protection and governance,” Dr Anderson Kehbila of SEI told attendees.
To achieve optimum trade balance with the EU, Kenya, Tanzania, Uganda, Rwanda, Burundi, Democratic Republic of Congo, Ethiopia and South Sudan will need to show more efforts in prosecuting corrupt trade players in the East Africa Court of Justice while domesticating laws enacted by the East African Legislative Council, participants said.
“Trade laws should not be made in isolation. Rules of origin, fair trade, carbon emission requirements, currency volatility revaluations and financing frameworks need strengthening,” said Caroline Cherop, head of trade at KNCCI.
The ECOWAS Regional Competition Authority (ERCA) organized a meeting of a Working Group for the review of the Draft AfCFTA Protocol on competition, prior to the fifth meeting of negotiations between African Union States Parties that is scheduled to hold in Accra, Ghana from 30 May to 2nd June 2022 on the said draft. The meeting took place from 19 to 21 May 2022 at Hotel Flamboyants in Saly, Republic of Senegal.
The purpose of the meeting was to bring together a number of ECOWAS Member States (Gambia, Nigeria, Senegal) and ERCA officials for a brainstorming on the draft AfCFTA Protocol on competition in order to ensure that all Member States adopt a common position on all the provisions of the draft AfCFTA Protocol to be shared with Member States’ negotiators and other regional organizations.
ESREM Project Closes on a High Note (COMESA)
The Enhancement for a Sustainable Regional Energy Market (ESREM) Project is closing on 30th May 2022 after being in operation for the past five years. Through the support of the European Union, the Project has endeavored to create a favorable regulatory environment and tools for regulatory oversight in the Eastern Africa -Southern Africa-Indian Ocean (EA-SA-IO) region. This is expected to stimulate increased power trading and bring a new horizon of cross border power trade opportunities for the countries in this region.
The overall objective of ESREM was to enhance a sustainable regional energy market in the EA-SA-IO region, which would be conducive to investment and sustainable development of the energy sector. The project was also meant to achieve a harmonized, efficient and gender-sensitive regulatory environment and it sought to capacitate regional regulatory associations and power pools to oversee and stimulate increased regional power trade more effectively.
Heads of Africa’s leading regional and continental bodies on Thursday met to discuss how to fast-track the continent’s development plan, known as Agenda 2063. Covid-19 and rising fuel, food and fertilizer prices in the wake of the Russia-Ukraine war, have raised the stakes, and the urgency to speed up recovery. The roundtable was organized by the African Development Bank Group, on the sidelines of its 2022 Annual Meetings, currently under way in Accra, Ghana. It was attended by representatives of the African Union Commission, the African Continental Free Trade Area (AfCFTA), regional economic communities, Africa50, and other regional development banks. African Development Bank Acting Senior Vice President Yacine Fal, who moderated the meeting, said it offered participants the opportunity to strengthen partnerships, mobilize more resources, as well as to take stock of the status of regional integration in Africa.
n opening remarks, African Development Bank chief Akinwumi A. Adesina noted that Africa would need $484 billion to support recovery efforts, with an additional $7 billion to $15 billion annually to deal with climate change. Infrastructure, which would drive that growth, requires another $68 billion to $108 billion, Adesina said. “Where are we going to find that money? The answer is quite simple: by collaboration and determination. We must pull together and push through,” he said.
Adesina commended the African Continental Free Trade Area (AfCFTA) which became operational in January 2021, marking a major milestone in Africa’s regional integration agenda. He said the institution had broken ground in establishing the legal, regulatory, and institutional arrangements that will allow Africa to become a single, $3.4 trillion market. “We must make the most of the strengths of every institution around the table to succeed in our goals,” he said.
Africa Investment Forum showcases major projects, including $15.6 billion Abidjan-Lagos Highway (AfDB)
On the margins of the African Development Bank Group’s 2022 Annual Meetings, the Africa Investment Forum convened investors to promote the power of the platform to draw critical investment to the continent. The investor roundtable on 25 May came at a time when capital flows are in flux in the aftermath of the Covid-19 pandemic. Such discussions are integral to the Africa Investment Forum, connecting project sponsors, investors, and financiers, as well as the public and the private sector.
The investment roundtable, held at the Kempinski hotel in Accra, Ghana, included AIF’s founding partners, development finance institutions, commercial banks, high net worth individuals, family businesses, representatives from venture capital and private equity firms.
On transport infrastructure, the $15.6 billion Abidjan-Lagos Highway project, led by the Economic Community of West African States (ECOWAS) Commission took centre stage. This is the largest investment opportunity that was discussed – and oversubscribed – at the 2021 AIF Boardrooms. This project, part of the Programme for Infrastructure Development in Africa (PIDA), is a critical public-private partnership that will link Abidjan to Lagos, via Accra, Lomé, and Cotonou along the West African coast.
AfDB defends financing of natural gas power projects (Business Daily)
The African Development Bank (AfDB) will continue financing natural gas projects despite environmental lobbyists claiming degradation, its president Akinwumi Adesina said. Although natural gas produces about half as much carbon dioxide (C02) when burned as coal, some critics say that rising production of the commodity is emerging as one of the biggest drivers of climate change and that plans for industry expansion could stifle efforts to stabilise climate. Dr Adesina, however, downplayed the concerns about the impact of natural gas on the environment and maintained that AfDB would continue financing such projects. “Renewable energy alone cannot power Africa…natural gas must remain part of Africa’s stable energy system,” Dr Adesina said last week during the bank’s annual general meeting in Accra.
Africa’s mobile money taxes could push poor out of digital economy (Thomson Reuters Foundation)
Cash-strapped African nations are rolling out an e-levy on mobile money transactions to boost revenues, but the policy could hurt the poorest as the cost of living rises and reverse impressive gains made in boosting economic inclusion.
Ghana is the latest in a growing number of African nations to impose a tax on mobile phone-based transactions, but critics say the levies are hurting millions of small-business owners and other low-income groups, just as the cost of living rises. The charges threaten to reverse the impressive gains made by mobile money in boosting economic inclusion, they warn. “Mobile money has been a great enabler, especially for the marginalised. It’s a main driver of financial inclusion for the poor, women and rural communities across Africa,” said Angela Wamola, head of sub-Saharan Africa at telecoms industry body GSMA.
IACO State Members Sign Nairobi Declaration to have Coffee Anchored as Strategic Commodity Under AU (CEO East Africa)
25 coffee producing African countries under the Inter- African Coffee Organisation (IACO) have officially signed the Nairobi Declaration to have coffee anchored as a strategic agricultural commodity under the African Union, in harmony with AU Agenda 2063. The ongoing Summit is being held under the theme “Sustainable Development and Economic Growth in the African Coffee Sector”. The African coffee producing countries consequently requested the African Union (AU) to adopt Coffee as strategic Agricultural Commodity in harmony with the Africa Agenda 2063.
According to the G25 African Coffee Summit Nairobi Declaration on the adoption of coffee as a strategic Agricultural Commodity in the AU Agenda 2063
he adoption of coffee as a strategic commodity in the AU will give Africa the leverage to address the challenges faced by the coffee farmers and other actors across the value chain under the auspices of the African Union to build a united and integrated Africa. The G25 African Coffee Summit also requested “The AU Commission to urgently develop an evaluation framework to track down the socio-economic impact on coffee farmers in relation to alleviating poverty and enact the AfCFTA to facilitate cooperation between African countries to encourage inter-African trade to explore the untapped coffee markets within Africa.”
The Summit also resolved to support production and research, enhance transparency and traceability of origins; encourage youth employment and empower the role of women; allocate more land for coffee production; incentivize farmers; support coffee research; offer technical assistance to farmers.
Countries in Kisumu declaration, endorse UN, African new urban agenda (The Guardian Nigeria)
With a total of 20 resolutions pledging renewed commitment to tackling key issues relating to growing role of cities on implementation of the United Nations 2030 Agenda and the African Union Agenda 2063, city managers and high level officials of government ended the 9th edition of the Africities summit in the city of Kisumu in Kenya. Given the change in pattern of settlements in Africa from being a continent mainly rural 30 years ago and one which will become mainly urban in the upcoming 10 years; they plan to make intermediary cities the structuring clusters of sustainable development in Africa by granting them a prominent place in spatial planning and creating new territorial dynamics that promote exchanges and linkages between the rural and urban environments. By 2050, 50 per cent of all Africans will live in urban areas. Today, more than 64 per cent of the urban population lives in informal settlements. There is a deficit of housing and finance with only 15 per cent of urban dwellers in Africa able to purchase their own homes.
The summit in its Kisumu declaration, acknowledged that small and intermediary cities currently host 60 per cent of urban dwellers and account for nearly 50 per cent of the African Gross Domestic Product (GDP); the delegates pledged to give priority to urban planning as an instrument for controlling the growth of urban and peri-urban areas by putting in place the institutional, legal, regulatory, and operational instruments, as well as the conditions for a participatory dialogue with the people.
Is UK-Africa trade strategy for charity or business deals? (This Day)
The UK government’s new International Trade Strategy directly links Britain’s aid budget to trade deals – and as a result has been criticised for offering “aid for trade” and accused of putting “politics before poverty” and being “a double whammy against the world’s poor”. One opposition politician called the policy “short-sighted and wrong”; another claimed, “the UK’s proud reputation as a development superpower has been comprehensively trashed.”
One path sees nations in Africa, with something of a perpetual colonial status, eternally dependent on handouts from former rulers. The other sees us raised up – and raising ourselves up – to the status of equals. At the heart of the strategy is a decision that the British government’s contributions to multilateral organisations will decrease in favour of bilateral partnerships. This means favouring individual aid packages aimed at, in the words of the strategy, “supporting partner countries to grow their economies sustainably” through investment “in particular for cleaner and more reliable infrastructure.”
Canada releases $78m for smallholder food producers in Africa (The East African)
The Canadian government has announced a $78 million contribution to a funding kitty of the African Development Bank (AfDB) to aid local food producers improve their yield. The money, to be disbursed as concessional loans, will target small and medium enterprises involved in agribusiness especially those founded and run by women. The money was announced this week as the Bank launched its Emergency Food Production Facility, a $1.5 billion project aimed at raising African yield of food production to 38 million tonnes by end of 2022.
The Bank said it will raise an initial $1.3 billion and partners will raise the rest to support up to 20 million farmers across the continent with soft loans worth of certified seed, fertiliser and technology necessary to improve yield. The money will be disbursed as part of the Assistance Innovation Programme which the Canadian government uses to support private enterprises involved in Sustainable Development Goals such as fighting hunger or climate change.
Pak-Africa current $4.18 billion trade below then it’s potential: Zafar Bakhtawri (Associated Press of Pakistan)
Former President Islamabad Chamber of Commerce (ICCI) and senior leader of United Business Group (UBG) of FPCCI Zafar Bakhtawri said the current $4.18 billion annual trade volume between Pakistan and Africa was far below then it’s potential in the Africa region, which could be doubled in the next three years. Exploring new markets and trade diversification policy in Africa is critical to increasing annual trade, he said.
Global economy news
International trade statistics: trends in first quarter 2022 (OECD)
Following six quarters of sustained growth, the value of international merchandise trade for the G20 reached a new high in Q1 2022. Exports and imports increased by 3.6% and 5.8%, as compared to Q4 2021 and measured in current US dollars. The increase is largely explained by rising commodity prices, as the war in Ukraine and COVID-19 containment measures in East Asia placed further pressure on the prices of traded goods and on already strained supply chains.
Growth in exports and imports of services for the G20 are estimated at around 2.0% and 1.1% in Q1 2022, respectively, compared to the previous quarter and measured in current US dollars. The preliminary estimates are well below the rates of 6.2% and 3.1% recorded in Q4 2021 for exports and imports, reflecting weaker trade in the transport sector in East Asia and a general slowdown in services trade across most of the G20 economies for which data are available.
Globalisation, not localisation, is the key to post-pandemic prosperity (VoxEU)
In recent years, extreme weather events and trade tensions spurred by growing economic nationalism and protectionism have tested the resilience of global value chains (GVCs). The sudden and massive Covid-19 induced drop in global trade in the first half of 2020 dealt them another blow, prompting predictions that the pandemic would result in restructuring of the GVCs, shortening the supply chains, and leading to reshoring. Then, as the world economy was still recovering from Covid-19, the war in Ukraine caused more major disruptions to GVCs, hitting developing countries particularly hard.
Recent studies suggest that GVCs transmit shocks to production and trade from one country to another. On the other hand, participation in GVCs may soften the blow of a domestic shock such as a lockdown or natural disaster like the 2011 earthquake in Japan, by ensuring access to critical inputs when foreign markets are closed. GVCs can also drive a recovery, spreading the benefits as countries emerge from lockdowns or lift trade restrictions at varying paces. What further shocks to GVCs should we expect in coming years? Is it possible to design policies to help developing countries enhance resilience to trade shocks without endangering growth?
In a new paper, we couple ENVISAGE, a state-of-the-art global economic model, with the GIDD microsimulation framework to simulate three scenarios: (1) high-income economies and China raise barriers to imports and increase domestic subsidies to re-shore production (‘Reshoring leading economies’), (2) wider localisation when developing countries join the reshoring efforts (‘Reshoring all’), and (3) developing countries seek to reduce trade costs and make it easier to use imports in domestic production (‘GVC Friendly Liberalisation + Trade Facilitation (TF)’).
UN “Deeply Troubled” by Impending Cuts on Development Aid by Rich Nations (Inter Press Service)
The four-month-old Russian invasion of Ukraine, which has triggered a hefty increase in military spending among Western nations and a rise in humanitarian and military assistance to the beleaguered country, is now threatening to undermine the flow of Official Development Assistance (ODA) to the world’s poorer nations. In an advance warning of the upcoming cuts, the UN’s Deputy Secretary-General Amina Mohammed told a recent meeting of the Economic and Social Council (ECOSOC): “As Chair of the United Nations Sustainable Development Group, I am deeply troubled over recent decisions and proposals to markedly cut Official Development Assistance (ODA) to service the impacts of the war in Ukraine on refugees”.
UN Secretary-General Antonio Guterres, who was equally concerned about the impending reductions, has urged donor nations to reconsider making cuts that will affect the world’s most vulnerable. He said ODA is more necessary than ever, and called upon all countries to demonstrate solidarity, invest in resilience, and prevent the current crisis from escalating further.
Europe turns to African oil suppliers as Russia shifts to Asia (BusinessLIVE)
Russia’s invasion of Ukraine has reconfigured the global oil market, with African suppliers stepping in to meet European demand and Moscow, stung by Western sanctions, increasingly tapping risky ship-to-ship transfers to get its crude to Asia. The reroutings mark the biggest supply-side shake-up of the global oil trade since the US shale revolution altered the shape of the market about a decade ago and suggest Russia will be able to navigate a EU oil ban, provided Asia and China continue to buy its crude. Sanctions imposed on Moscow after the conflict in Ukraine kicked off in February, including a US ban on its oil imports, have prompted Russia to pivot away from Europe, where its crude is shunned, to customers in India and China who are picking up cargoes at a steep discount, according to industry data and traders.
Russian exports were back to pre-invasion levels in April, according to data from the Paris-based International Energy Agency and oil prices have stabilised at about $110 after hitting a 14-year high above $139 a barrel in March. Even if the EU agrees to an oil ban in its next round of Russian sanctions, analysts said the impact could be tempered by demand from Asia.
Analysis: How the Ukraine conflict is reshaping global oil markets (Reuters)
Russia’s invasion of Ukraine has reconfigured the global oil market, with African suppliers stepping in to meet European demand and Moscow, stung by Western sanctions, increasingly tapping risky ship-to-ship transfers to get its crude to Asia. The reroutings mark the biggest supply-side shakeup of the global oil trade since the U.S. shale revolution altered the shape of the market around a decade ago and suggest Russia will be able to navigate a European Union (EU) oil ban, provided Asia and China continue to buy its crude.
Sanctions imposed on Moscow after the conflict in Ukraine kicked off in February, including a U.S. ban on its oil imports, have prompted Russia to pivot away from Europe, where its crude is shunned, to customers in India and China who are picking up cargoes at a steep discount, according to industry data and traders.
IFC, Partners for Growth Join Forces to Support Growth-Stage Companies in Emerging Markets (IFC)
IFC and US-based fund manager Partners for Growth (PFG) are uniting to provide much-needed debt capital to innovative early- to mid-stage companies in emerging markets, with a focus on fintech, software, e-logistics, health, and life sciences firms.IFC, a member of the World Bank Group, will invest $30 million in a new investment vehicle managed by PFG. The vehicle will be PFG’s first managed account dedicated solely to global emerging markets and IFC’s first investment with a private debt manager focused on venture and growth stage markets. PFG will collaborate with its long-time strategic partner, Silicon Valley Bank, on the initiative.
“The COVID-19 pandemic has heightened uncertainty and risk aversion in emerging markets, limiting the amount of credit available for small- to mid-sized companies,” said Paulo de Bolle, Global Senior Director of IFC’s Financial Institutions Group. “Our partnership with PFG will play a key role in improving access to finance for deserving high growth technology businesses.”
The adoption of digital business has accelerated tremendously in the last two years as the world adapted to the pandemic. Nowhere is the scope for impact greater than in emerging markets as they rebound in the coming years. This partnership will support the growth of small and medium enterprises across the technology sector and allow new financial services providers to thrive. Deepening capital markets is an essential element to improving the economic recovery. By providing scarcely available private credit to innovative businesses in developing countries, the partnership with PFG is aligned with IFC’s strategy of scaling up investments to reverse economic decline, foster technological innovation, and mobilize private capital at scale.
Five things you should know about the Commonwealth Business Forum (The New Times)
The preparations to host the Commonwealth Business Forum (CBF) in Rwanda, are in high gear, according to officials. Slated to take place between June 21 and 23, CBF is one of the flagship events of the Commonwealth Heads of Government Meeting (CHOGM), which will be hosted in Rwanda in June 2022. For Rwanda, hosting the forum fourteen years since it was last hosted in Africa, the country sees it as a great platform to strengthen trade and investment with the rest of the Commonwealth members.
According to the Commonwealth Secretariat, the Commonwealth Advantage, with its shared values, regulatory systems and language, has the potential to increase intra-Commonwealth trade by 20 percent. It can also reduce the cost of doing business between member countries by up to 19 percent. Revised estimates indicate that bilateral trade costs between Commonwealth country pairs are 21 percent lower, on average, compared with non-Commonwealth countries.
Neither by Land nor by Sea: The Rise of Electronic Remittances during COVID-19 (World Bank)
Despite concerns that the COVID-19 economic collapse would torpedo international remittances, formal remittances to several developing countries ballooned early in the pandemic. This increase might, however, have reflected a shift from informal channels to formal ones rather than a change in actual flows. This paper employs Mexican data to explore this and finds that remittance channels did change. The rise in formal inflows was larger among municipalities that were previously more reliant on informal channels (for example, near a border crossing). Households there also experienced a disproportionate increase in bank accounts opened after lockdown measures. The paper also rules out hypotheses related to the US Coronavirus Aid, Relief, and. Economic Security Act and altruism.
Blockchain can drive financial inclusion and climate resilience (Thomson Reuters Foundation)
Crypto and blockchain solutions can be tailored to meet the specific needs of the world’s underbanked, and enable an inclusive and equitable global financial system.
Today, some 1.7 billion people around the world lack access to one of the most basic building blocks of prosperity: a bank account. As the use of crypto and blockchain technologies expands globally, there’s an opportunity to drive financial inclusion and climate resilience by transforming the core infrastructure that affects how financial products and services are delivered. For people without access to any form of financial services, the inability to save money safely or trade beyond cash in hand can leave them caught in a poverty trap that’s almost impossible to escape. Meanwhile, the World Bank predicts that by 2030, climate change will push 100 million more people into poverty, with low-income countries bearing 75%-80% of climate impact costs. This is where crypto and blockchain come in.
The End of the Digital Gold Rush: How to Make Money on Bitcoin’s Collapse? (IT News Africa)
Bitcoin is often referred to as “digital gold”. Back in 2010, BTC was worth 5 cents, and its price reached $69,000 at its peak in November 2021. It is clear that the prospect of quickly and easily turning $100 dollars into $138,000,000 attracted a huge mass of people willing to get rich quickly. So what happened in the last 10-12 years can be called the “Digital Gold Rush”, by analogy with the Gold Rush in the USA in the second half of the 19th century. But then many, instead of getting rich, on the contrary, lost their money. The same can be observed now: bitcoin has returned to the values of December 2020, having lost about 60% of its value in just 6 months.
According to the Bloomberg Billionaires Index, Coinbase CEO Brian Armstrong’s net worth has decreased from $13.7 billion to $2.2 billion. This was not only due to the fall in digital asset prices, but also due to the fall in Coinbase shares, the price of which fell by more than 80%. The capital of the CEO of the FTX crypto exchange Sam Bankman-Fried has halved and now stands at $11.3 billion. The well-known founders of the Gemini cryptocurrency trading platform, the brothers Cameron and Tyler Winklevoss, have individually lost more than $2 billion, which is equivalent to almost 40% of their total fortune.
The Crypto Fear & Greed Index is firmly entrenched in the Extreme Fear zone. And the president of Euro Pacific Capital Peter Schiff predicts the fall of the main cryptocurrency to $8,000. “We have a long way down,” the billionaire wrote.
Green trade crucial to economic security and net zero, says International Trade Secretary (GOV.UK)
Green trade is crucial to growing the UK’s economy, achieving net zero and driving our future prosperity, the International Trade Secretary will say today (18 May). In a speech at Bloomberg, Anne-Marie Trevelyan will set out the UK’s pioneering role in harnessing trade to combat climate change, and how driving renewable energy can cut reliance on Russian oil and gas and reinforce the UK’s energy security. The UK’s green economy is projected to grow by 11% per year out to 2030, and by 2050 over 1.2 million people could be directly employed in low-carbon goods and services sectors – a six-fold increase from today.
The International Trade Secretary will also announce a new Green Trade and Investment Expo in the North East this autumn, hosted alongside the Department for Business, Energy and Industrial Strategy. The Expo will bring together UK businesses and global investors to capitalise on the commercial opportunities from our drive to net zero.
5 things you should know about the UN Ocean Conference, a chance to save the planet’s largest ecosystem (United Nations)
The Ocean is the planet’s largest ecosystem, regulating the climate, and providing livelihoods for billions. But its health is in danger. The second UN Ocean Conference, due to take place in June, will be an important opportunity to redress the damage that mankind continues to inflict on marine life and livelihoods. With delegates from Member States, non-governmental organizations, and universities attending, as well as entrepreneurs looking for ways to sustainably develop the “Blue Economy”, there are hopes that this event, taking place in the Portuguese city of Lisbon between 27 June and 1 July, will mark a new era for the Ocean.
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SA poultry producers missing out on export market with lax livestock health standards (Engineering News)
The South African poultry industry is “missing a massive opportunity” to export products as a result of it not meeting the health and safety standards required by trade blocs such as the European Union (EU), says the South African Association of Meat Importers and Exporters (AMIE).
A robust and successful poultry export market for South African chicken could bring material value to the entire value chain, from local producers and their shareholders, to medium-sized and small-scale farmers, exporters, processors and consumers, the organisation says.
AMIE CEO Paul Matthew notes that, while various parties (local industry, importers and government) signed and agreed to a Poultry Master Plan in 2019, very little progress has been made in achieving the targets set out in the master plan to date.
For South Africa to export poultry to the global market, several criteria need to be urgently addressed, including gaining access to countries with which South Africa has preferential trade agreements and meeting the international health and safety standards and requirements of countries to which South Africa will export.
South African terms of trade boon provides unique opportunity for the economy (Engineering News)
South Africa is currently enjoying a terms of trade boon, with export prices outpacing import prices, market research firm Intellidex director and capital markets research head Peter Attard Montalto said on May 25. “It’s an unusual situation, driven by metals prices and helped by the fact that South Africa is a net exporter of food at the moment. We’re seeing that, even though we have very high oil prices boosting the import basket, the export side is more than offset,” he said.
‘Lifting ban on imports commitment to AfCFTA’ (The Herald)
THE Government’s lifting of the import ban on selected basic commodities is testimony to the country’s readiness and commitment to fully implement the dictates of the Africa Continental Free Trade Area (AfCFTA) agreement to which Zimbabwe is a signatory.
Industry and Commerce Minister Dr Sekai Nzenza said Zimbabwe was still finalising its tariff offer under the AfCFTA and hoped to reap huge benefits from the agreement. Earlier this month, the Government through the Ministry of Finance and Economic Development, issued measures to promote the availability of basic commodities as a measure to counter the recent spike in prices of locally manufactured goods. This position has since sparked a massive outcry amongst local industry players as it allowed the flow of basic commodities onto the local retail market.
Kenya’s roadmap to double fish yield, create marine jobs (Business Daily)
Kenya’s fishing sector is set for a major boom after the government drafted a set of regulations to empower industry players. The implementation of the new rules is expected to double fish catch to 300,000 metric tonnes. According to the Draft Marine Fisheries (Access and Development) Regulations 2022 and Lake Turkana Fisheries Management Plan, Kenya will earn at least Sh100 billion and create 240,000 jobs annually once the new regulations are fully implemented. The reforms are expected to bring investment certainty in marine fisheries because fishing rights will be issued “for a sufficiently long time, allowing prudent and profitable planning of investments”.
Higher flour prices loom as millers snub maize imports (Business Daily)
Millers have snubbed maize imports on the back of high landing cost for the produce and a shorter window provided for shipping the commodity, a move that will likely subject consumers to higher cost of flour. Processors argue that currently they can only get good stocks of non-Genetically Modified Organism (GMO) maize in Mexico and it will take at least 45 days for the first consignment to arrive after orders have been placed. The government last week waved 50 percent duty levied on maize outside the East African region and allowed millers and traders to ship in 540,000 tonnes in order to check the current high prices of flour. “We have the challenges that make it nearly unfeasible to import maize in the window provided. Three months is a short time to bring in any substantial quantities,” said Rajan Shah, chief executive officer Capwell Industries. Mr Shah said the international price of maize also makes the landing cost so high that millers would find it difficult to justify affordability, hence defeating the purpose of importing at this time.
Kenya’s push for a purely formal seed system could be bad for farmers (The Conversation)
Kenya’s government wants farmers to grow crops from licensed seeds only. These are hybrid seeds that are certified free of various seed-borne pests and diseases. The Seeds and Plant Varieties Act makes it a crime to plant and exchange uncertified seeds. But many small-scale farmers rely on informal exchanges of seeds with their neighbours to secure their food supply.
Kenya is one of the leading countries in Africa when it comes to formal seed distribution. The second seed distribution channel is informal. This largely involves the production and exchange of seeds among small-scale farmers. This system is characterised by a lack of seed testing, formal registration or quality control.
Tanzania economy feels the heat from Ukraine war (The East African)
Tanzania has admitted its current account is hurting after it registered a deficit of $1.31 billion in the first three months of 2022, compared with the $352 million it recorded in the corresponding period last year. According to the Bank of Tanzania, this is due to “a steady increase in the import bill, particularly for refined white petroleum products,” signalling how supplies to the region have been hurt by the Ukraine invasion. “The external sector has been affected by challenges associated with the Russia-Ukraine war coupled with the residual effects of the Covid-19 global pandemic,” the Bank of Tanzania said in its 2022 Q1 report released on May 16.
The import bill and a rising debt also meant the country spent more than it earned. Total national debt rose a further $399.8 million from December to $37.84 billion by the end of March 2022 with the external debt alone accounting for $28.35 million by March.
prices of agricultural commodities increased from December 2021 due to “persistent supply disruptions, increasing demand for food from neighbouring countries and low or delayed short rain season harvests.”
Samia: Tanzania gearing up to connect countries through rail, road (The East African)
Tanzania is ready for regional integration and is in the process of completing road and railway networks with the goal of linking neighbouring countries, hence contributing to continental integration efforts, President Samia Suluhu Hassan has said.
However, the country will need more external funding to finance the construction of the next phases of the Standard Gauge Railway (SGR) as well as proposed highways to Kenya, Democratic Republic of Congo and Burundi, she said on Wednesday in Ghana after receiving an award for her country’s recent infrastructure projects.
Angola Takes Charge of Downstream Sector Developments (Energy Capital & Power)
As the second largest oil producer in sub-Saharan Africa, with production levels most recently estimated at 1.22 million barrels per day (bpd), the Republic of Angola continues to make strides across the upstream segment of its hydrocarbon sector. However, more recently it is the southern African country’s downstream sector that has been gaining faster momentum, with many large-scale projects underway. By prioritizing these downstream mega-projects, the government of Angola aims to improve domestic capacity, reduce refined petroleum imports and begin to firmly establish the country as an energy secure and independent hydrocarbon market.
Currently, 80% of the country’s refined petroleum products are imported, costing Angola $1.7 billion per annum to meet domestic demand. With this reality sharply in focus, the government is accelerating energy security and self-sufficiency ambitions, and with 8.2 billion barrels of its own oil reserves, there is a strong case for both the upgrade of current facilities and for the construction of new refineries countrywide.
to strengthen Angola’s downstream infrastructure, particularly with regards to the efficient transportation of both oil and gas, the government is ensuring investments in associated infrastructure programs, such as pipelines. In this respect, the Angolan government signed a $5 billion deal with the government of Zambia in 2021, for the construction of an oil pipeline that will link the two southern African nations. The pipeline will enable Angola to supply Zambia with finished petroleum products, strengthening regional petroleum trade.
Low oil output barely enough to cover petrol imports – Nigeria FinMin (Engineering News)
Low crude oil production means Nigeria is barely able to cover the cost of imported petrol from its oil and gas revenues, Finance Minister Zainab Ahmed told Reuters on Thursday. Ahmed added in an interview at the World Economic Forum in Davos that she hoped Nigerian oil production would average 1.6-million barrels a day this year, up from around 1.5-million barrels a day in the first quarter.
Next Africa: A Nation’s Cryptocurrency Gamble Draws Fire (Bloomberg)
The Central African Republic’s adoption of Bitcoin as legal tender and plan to set up a crypto hub has confused donors and angered the country’s neighbors. The nation has a barely functioning economy and is riven by conflict. Only 11% of its citizens have access to the internet and there is very little electricity generation — two pre-requisites for the use of cryptocurrency. The initial announcement of Bitcoin’s adoption — only the second country to do so after El Salvador — drew a rebuke from the regional central bank and concern from the International Monetary Fund. But CAR hasn’t stopped there. The next step is to allow the purchase of land with Bitcoin and create a cryptocurrency economic zone known as Sango — The Crypto Island.
Tunisia Forum for Enhancing Economic Cooperation between Libya, Tunisia and Korea discusses developing trade with the rest of Africa (Libya Herald)
Libya’s (Tripoli-based) Minister of Economy and Trade, Mohamed Hwej discussed yesterday ways to expand the horizons of trade cooperation between Libya, Tunisia and Korea towards the rest of Africa. The Minister indicated that the State of Libya is looking forward to strengthening cooperation with Korea to develop infrastructure, reconstruction, technology and the communications sector and implement investment projects in all sectors, calling on companies and businessmen from Korea to return to complete and resume their work as soon as possible, stressing the keenness of the Ministry of Economy and Trade to provide the necessary facilities to companies Korean and provide a suitable work environment.
African trade and development news
Africa urged to harmonise production processes (Chronicle)
ZANU-PF Second Secretary, Cde Kembo Mohadi has urged African countries to urgently harmonise their production processes leveraging on the continent’s rich natural resources to create wealth so that they are able to compete with developed nations.
In an interview on Wednesday, Cde Mohadi singled out Africa as one of the richest continents in the world, saying it is capable of developing using its own collective resources.
“We need to use our own resources as Africa to develop ourselves so that we are able to compete at the same level with other continents,” he said.
AfCFTA targets 30% trade growth, to create African Customs union – Anatogu (Businessday)
Francis Anatogu, the special adviser to President Muhammadu Buhari on public affairs, says effective implementation of the African Continental Free Trade Area (AfCFTA) agreement will double intra-African trade which currently stands at 15 percent. Speaking via Zoom at the recent public presentation of the Nigerian Logistics and Supply Chain Industry Report in Lagos, Anatogu, who doubles as the secretary of the national action committee on AfCFTA, said the global supply chain has been disrupted in recent years by the outbreak of COVID-19, Russia-Ukraine war and nationalistic trade policies. According to him, African countries are now in a good position to take advantage of some of these disruptions to grow their supply chain industry.
Launch of Digital Policy Working Group (Afreximbank)
Afreximbank, in collaboration with the African Union Commission (AUC) and African Continental Free Trade Area Secretariat (AfCFTA), has established a digital policy working group to serve as a high-level platform and point of contact for public-private sector engagement on African Digital policy issues in the context of the rapidly evolving digital economy of Africa.
The working group comprises digital “scale-ups”; mature digital ventures in Africa with clear trade-enabling products and services, operations and business models that transcend a single domestic market and provide services across the continent – working alongside representatives of the AfCFTA and AU member states. The working group will provide AU Member States and AfCFTA State Parties with a direct line of sight to the African digital economy and the opportunities that exist within it, as well as insight into the challenges facing the companies operating in the market.
The launch of this working group will help guide digital and ecommerce policy in the region, informed by the insights and experiences of the venture companies, and leveraging on the relationships established by Afreximbank, the African Union and the AfCFTA. The working group will deepen the relationship between African venture companies and the sovereign nations in which they operate, as well as their supporting multilateral institutions, leading to the continued exponential growth of the African digital ecosystem.
The working group will initially focus on key digital policy areas that hold potential to transform Africa’s digital environment and support African development under Agenda 2063; at the inaugural workshop, the group deliberated policy and regulatory considerations that need to be addressed to accelerate Scale-Up participation in Africa, based on the insights and challenges faced by its African venture founders.
Trade bodies urged to leverage digitalisation (Graphic Online)
Trade promotion organisations (TPOs) have been urged to leverage digitalisation to boost trading across the world. The organisations have also been charged to work hard to increase trade flows to ensure sustainable growth and development.
The Chief Executive Officer of the Ghana Export Promotion Authority (GEPA), Dr Afua Asabea Asare, said the world could not wait for the current overlapping global crises of war and COVID-19 and their attendant disequilibrium to simmer down before taking action.
She said digitalisation had been a positive outcome of the pandemic and urged members of the network to consider it as a fulcrum to boost trade.
African Export-Import Bank (Afreximbank) has renewed its technical and financial support to the Coalition for Dialogue on Africa (CoDA). After two years of successful collaboration, the two institutions have embarked on a new three-year partnership.
This support has helped CoDA to propel several initiatives across Africa, including national action on Illicit Financial Flows (IFFs), capacity building to implement continent-wide asset recovery through the Common African Position on Asset Recovery (CAPAR), as well as support for the establishment and implementation of the African Continental Free Trade Area (AfCFTA). This new multi-year funding cycle will enable CoDA to support medium- to long-term actions on these and other issues across the continent.
The multi-year support from Afreximbank is aimed at strengthening the capacity of CoDA to fulfil its mandate of increasing domestic resource mobilization by facilitating actions to reduce IFFs from Africa, supporting economic integration through the holistic implementation of the AfCFTA, and improving people’s lives through support for several developmental initiatives across Africa, including Africa’s ambitions in vaccine manufacturing.
African Union head to push Russia, Ukraine to unblock grain exports (Reuters)
Senegal’s president and African Union chairman Macky Sall said on Wednesday that when he visits Russia and Ukraine in the coming weeks he will push them to unblock exports of grains and fertilizer to avoid widespread famine. Africa is suffering from disruptions in food supply and soaring prices of basic goods and risks “disastrous consequences” if the situation endures, Sall said during a conversation with philanthropist Mo Ibrahim at the Ibrahim Governance Forum. Nearly half of Africa’s 54 countries rely on Russia and Ukraine for wheat imports, according to the United Nations Food and Agriculture Organization. Russia is also a major supplier of fertilizer to at least 11 countries.
If food supply blockages were to continue and there was a famine, Sall said: “The world would not be able to contain the consequences because it would be massive on immigration. It would be dramatic for African countries.”
Study highlights potential export markets for South African, SADC products (Engineering News)
A study, undertaken as part of the European Union (EU) and Southern African Customs Union (SACU) Economic Partnership Agreement (EPA) on trade in goods, has highlighted specific opportunities for various industries to grow and/or diversify their exports and, in the process, help to offset some export risks some industries face. The study, undertaken by market research company Trade Research Advisor, modelled trade opportunities for companies trading out of Southern Africa into the EU, and vice versa, in terms of transportation, economic, commercial and socioeconomic metrics, Trade Research Advisor MD Martin Cameron revealed this week.
“We categorised the outcomes in terms of short-term opportunities, including export promotion opportunities where there are capabilities to export and it is mainly a question of marketing and diversification, and in terms of medium-term opportunities, mainly focused on export development in industries that are less mature in global trade terms.
Companies need to be aware of the opportunities in countries, whether in Southern Africa or Europe, which is what the study aimed to reveal.
“Different regions and their societies also have different tastes, which present additional trade opportunities when companies start delving into individual countries and export opportunities,” said Cameron.
“Trade relies on multiple, overlapping components. Trade is not either/or, but rather and, and, and. To successfully reap the benefits of trade, there must be infrastructure in place, services, a robust and stable legal and regulatory framework, and supply and demand,” he said.
This is key to understand in the African context, as deficient infrastructure to serve the needs of people negatively affects Africa’s economies’ growth by 2% a year. The provision of services is a more important determinant for trade than only where the opportunities lie, highlighted Cameron.
East Africa Business Network marks the dawn of a new era (EIN News)
As the African Continental Free Trade Area AfCFTA work to create a single, continent wide market for goods and services, ushering in reforms to enhance long term growth, the East Africa Business Network (EABN) is accelerating international trade and investment opportunities. “The EABN is focusing on the human to human connection across a global community.” says Mr. Bill Morgan, Vice Chairman of the East Africa Business Network and Avistas CEO & Founding Principal: “As the AfCFTA works to harmonize free trade across the continent of Africa, the EABN formerly known as the East Africa Chamber of Commerce (EACC) continues in its 17th year of facilitating public and private investments and trade between the East African Community (EAC) and the rest of the world to enhance the human condition and quality of life with integrated entrepreneurial endeavors.”
Harmonize domestic taxes to attract investments in the EAC bloc (EABC)
The East African Business Council CEO, Mr. John Bosco Kalisa has urged EAC Partner States to harmonize domestic taxes to attract more investments into the EAC region. Speaking during the Webinar on Domestic Tax Regimes and Proposed measures for 2022/23 Budgets Mr. Kalisa said the Treaty for the establishment of the East African Community obliges the Partner States to harmonize their tax policies with a view of removing tax distortions in order to bring about a more efficient allocation of resources within the Community.”
The Vice-Chairman of EABC Mr. Simon Kaheru, said “Under EAC Customs Union which came into in January 2005, the EAC Partner States agreed to apply harmonized customs duties on products imported from the rest of the world into the EAC region. This is implemented through uniform application of the East African Community Common External Tariff (CET).”
EABC Vice Chairman, Mr. Simon Kaheru applauded the EAC Minister responsible for trade, industry, finance and investment who in April 2022 finally agreed on 35% as the Maximum Rate for the new four-band tariff structure.
Development Partners reaffirm support to the EAC, as the bloc embraces new development strategies (EAC)
The EAC’s quest to strengthen its partnerships and strategically refocus to respond to East Africans’ needs, has today been affirmed by development partners, who committed to support key priorities under the 6th EAC Development Strategy. This follows the 3rd East African Community Development Partners Group (DPG) Forum held at the EAC Headquarters in Arusha, Tanzania, providing a platform for the EAC to share critical priorities anchored in the EAC Vision 2050, the 6th EAC Development Strategy, the Comprehensive COVID-19 recovery plan, and funding needs of the EAC Programmes and Projects.
Kenya GDP growth forecast to trail East African peers (Business Daily)
Kenya’s real GDP growth will next year trail the performance of its East Africa Community (EAC) partners except Tanzania and Burundi, new projections by the African Development Bank (AfDB) show, partly hurt by inflationary pressures. The bank’s newly released annual Africa economic outlook report shows that Kenya’s GDP growth is projected to slow down to 5.7 percent in 2023 from 5.9 percent this year—the third-lowest within the seven-member bloc. The outlook shows that Rwanda will retain the fastest GDP growth in 2023 at 7.9 percent, followed by South Sudan and the Democratic Republic of Congo (DRC) tied at 6.5 percent, Uganda (6.2), Kenya (5.7), Tanzania (5.6) and Burundi (4.6).
Financial resilience in small states: Lessons from Eswatini (Brookings)
Small states are particularly exposed to the financial impacts of shocks, varying from natural disasters to the ongoing COVID-19 pandemic and man-made events such as the Ukraine war. The shocks disproportionally and recurrently affect small states due to their peculiarities. They have small populations and economic bases combined with geographically concentrated economies, which makes them particularly vulnerable to shocks. They tend to be geographically isolated, which creates challenges in mobilizing resources to respond to shocks. Furthermore, their growth trajectories tend to rely on few sectors (undiversified) or large neighboring countries. These dynamics highlight the central importance of strengthening financial resilience in small states when driving toward development and poverty alleviation.
Integrate Capital Markets For Faster Economic Recovery, Development – VP Bawumia (The Presidency, Republic of Ghana)
A faster and deeper integration of Capital Markets is crucial if the West Africa sub-region is to recover from the double hits of the Covid 19 pandemic and the ongoing Russia-Ukraine conflict, Vice President Bawumia has stated. Speaking at the second edition of the biennial Conference of the West Africa Markets Conference (WACMaC), organized by the West Africa Securities Regulators Association (WASRA) in Accra on Tuesday, May 24, 2022 Vice President Bawumia said such integration would not only facilitate cross-border trade, but also help raise the needed capital for local development. “A well-integrated West Africa Capital Market can accelerate the mobilization of resources for Sub-regional and continental infrastructure needs which is estimated by the African Development Bank (AfDB) to be about $130-$170 billion a year (AfDB, 2019 report). This can be supported or supplemented by funds raised across the region and the continent. “An integrated capital market can also help to attract capital and stem the rapid tide of capital flight from Africa which has hit unprecedented proportions. In this case, capital will begin to work within the continent as bankable projects would be initiated locally,” he explained.
Africa’s Recovery Remains Uneven; More Resources Are Needed - African Development Bank Report (AfDB)
An African Development Bank report released Thursday shows that the institution was pivotal in 2021, delivering timely investments that are helping millions of Africans overcome the unprecedented challenges caused by the Covid-19 pandemic.
Titled “Returning Africa to its Development Path,” the 2022 edition of the report notes that the Bank Group pressed ahead with its projects in 2021 despite shutdowns, supply chain disruptions, and a global economic slump. Across the continent, the Bank’s investments expanded access to electricity, improved transport, boosted agricultural productivity, fuelled industrialization, and integrated regions.
According to the report, however, economic recovery remains uneven and fragile, even as the easing of Covid-19 restrictions has put many regions of the continent back on a growth trajectory. The report estimates that continued vulnerabilities and new health measures pushed an additional 30 million Africans into extreme poverty in 2021.
But the pandemic, and its far-reaching consequences, is not the only crisis facing the continent today. African countries are also grappling with the climate crisis, insecurity in the Sahel and the Horn of Africa, and the impact of the war in Ukraine, particularly its impact on food prices. Investments need to accelerate.
The United Kingdom may channel some of its International Monetary Fund Special Drawing Rights (SDRs) to Africa through the African Development Bank, revealed UK Minister for Africa, Latin America and the Caribbean Vicky Ford yesterday.
Ford was speaking during a discussion seminar organized by the African Development Bank to advance a push to empower multilateral development banks to act as channels for reallocated SDRs. SDRs are an international reserve asset –not a currency—through which the International Monetary Fund supplements member countries’ official reserves. The seminar—titled Breaking down barriers around the use of SDRs to support Africa’s sustainable development—featured a discussion of a proposal to channel reallocated SDRS via multilateral development banks. Currently, the IMF’s Poverty Reduction and Growth Trust and its recently approved Resilience and Sustainability Trust are the sole channels for SDR reallocation.
Nicolas Kazadi, Minister of Finance of the Democratic Republic of the Congo said: “Now we have a unique opportunity with these SDRs to make a difference, and it is so important because it is not only a matter of development or poverty reduction. It is also a matter of climate challenges, and if we do not make it for Africa, we are all lost.”
Africa records strong recovery in remittances despite high cost (The East African)
Remittances to sub-Saharan Africa grew 14 percent to $49 billion in 2021, the strongest gain since 2018, even as the continent remained the costliest developing region to send money. According to the latest World Bank Migration and Development Brief dated May 2022, aggregate regional remittance costs averaged 7.8 percent between October and December last year. The average cost of remitting $200 from countries in the least expensive corridors amounted to 3.4 percent while costs for the most expensive corridors registered 31.5 percent during the same period, an increase of 12.3 percent from the year earlier. The report titled “A war in Pandemic: Implications of the Ukraine Crisis and Covid-19 on Global Governance of Migration and Remittance Flows,” notes that though intraregional migrants in Africa comprise more than 70 percent of all international migration, remittance costs are high due to the small quantities of formal flows and use of black-market exchange rates.
African nations leading the way on ‘food systems transformation’: Guterres (UN News)
António Guterres said for too long, nutrition, food security, conflicts, climate change, ecosystems and health have been treated as separate concerns, “but these global challenges are deeply interconnected. Conflict creates hunger. The climate crisis amplifies conflict”, and systemic problems are just getting worse. He noted that after more than a decade of improvements, one in five Africans were undernourished in 2020, while 61 million African children are affected by stunting. Women and girls bear the brunt, and when food is scarce, “they are often the last to eat; and the first to be taken out of school and forced into work or marriage.” Mr. Guterres said that UN humanitarians and partners were doing their utmost to meet Africa’s needs amidst crisis, but aid “cannot compete with the systemic drivers of hunger.”
Other “external shocks” were exacerbating the situation, such as an uneven recovery from the pandemic and the war in Ukraine, with African countries among the most heavily impacted by grain shortages and rising debt.
Africa coffee industry seeks to succeed without foreign influence (Independent)
African coffee-producing countries have gathered in Nairobi to chart ways of improving the continent’s coffee sector and cushion it from global shocks. These include the effects of pandemics, trade barriers, and market dynamics like unfair taxes and trade restrictions among others. The first G25 Coffee Summit also has the study of Uganda’s production success story top of the agenda, under the theme: “Sustainable Development and Economic Growth in the African Coffee Sector.” This comes at a time when Uganda is in the spotlight for various reasons including achieving a sharp increase in coffee production over the last five years, the decision to withdraw from participation in the International Coffee Organization’s current agreement, as well as the controversial agreement with a foreign company to process and export Uganda’s coffee.
Terming Africa a priority continent for India, the Ministry of External Affairs on Friday said the continent has a huge potential of joining collaboration in the exploration of Oil and Gas, especially in Western Africa. Dammu Ravi, Secretary (Economic Relations), MEA, while addressing a special briefing on the next week’s visit of Vice President M Venkaiah Naidu to Gabon, Senegal and Qatar said: “West African countries have lots of natural resources like oil and gas and have not been fully exploited. There is a lot of potentials for our companies to join collaboration with Gabon and Senegal.”
African leaders signal support for African Development Bank’s emergency food production facility (AfDB)
African governments and international development institutions have voiced support for the African Development Bank Group’s $1.5 billion emergency food production facility to help avert a looming food crisis across Africa. The Bank Group’s board approved the facility on 20 May. At a virtual meeting convened by the African Union Commission on Thursday, government ministers and development partners commended the initiative, which will boost domestic production of essential grains. Imports of these staples have been hit by the ongoing Russia-Ukraine war.
Green, Social, and Sustainable bonds to serve Africa’s sustainable investment needs (UNECA)
Green, Social, and Sustainable (GSS) bonds market remains a new frontier for Africa that will help the continent build a deeper, resilient and sustainable financing, according to policymakers, regulators, and peer sovereign issuers from across West Africa.
Hanan Morsy, ECA’s Deputy Executive Secretary said, “As an innovative finance instrument, GSS bonds help fill the SDG financing gap. While sharing characteristics with traditional bonds, GSS bonds exclusively direct financing to projects with positive climate and environmental outcomes across energy, transportation, construction, agriculture and water sectors.”
Jean-Paul Adam Director, Technology, Climate Change and Natural Resources Management Division at ECA said Africa faces today multiple challenges that include, debt burden and historical high cost of borrowing; recovery post Covid ; climate change related issues; energy and food shortages due to the Ukraine war. These challenges makes it even more necessary for African States to benefit from new ways to raise money from Private Investors in a transparent and efficient framework and at reasonable rates
Global economy news
Exports of intermediate goods see continued growth in fourth quarter of 2021 (WTO)
World IG exports increased by 21 per cent year on year in the fourth quarter of 2021, continuing the upward trend observed throughout the year. However, growth was slower than the 27 per cent recorded in Q3 and the 47 per cent in Q2. The pace of trade in IGs, which range from crops used in food production to textiles and metals needed to produce goods, is an indicator of the level of activity in supply chains.
Asian and African exports of industrial inputs to supply chains increased by more than 24 per cent year on year in Q4, while European exports of inputs grew by 18 per cent.
Weathering a ‘perfect storm’ of cascading crises (UNCTAD)
Climate change, COVID-19, the war in Ukraine – these crises threaten to derail development for 1.7 billion of the world’s most vulnerable people. The international community must take swift, coordinated action now to put the SDGs back on track.
In just two short years, a double whammy of external shocks has knocked global development off track and mired the ambitions of the 2030 Agenda in uncertainty. In the aftermath of the COVID-19 pandemic, developing countries were left exceptionally vulnerable and exposed – a situation which the war in Ukraine has now tuned into a “perfect storm” of cascading crises. The consequences are worrying, not just for developing countries themselves, but also for the success of sustainable development globally.
Following a robust though unequal economic recovery in 2021, marked by disrupted supply chains and multi-decade rises in inflation, the war in Ukraine caught the world economy off guard, roiling global markets for food, fertilizers, and fuels in which both Russia and Ukraine play an oversized role. This led to historic rises in commodity prices, and a general tightening of global financial conditions.
The challenge facing our international financing architecture today is that it was built primarily to protect the global economy from crises at the individual country level. But faced with the “perfect storm” of cascading crises – including climate change, pandemics, and war – hitting so many developing countries at the same time, the system is limited in how it can offer a systemic, global response that supports all countries along all dimensions.
‘Think resilience’ to protect against climate and other catastrophes (UN News)
More countries must “think resilience”, and urgently adopt and improve early warning systems to reduce risks from an increasing number of disasters across the world, a UN disaster forum concluded on Friday.
DDG Paugam: WTO is actively participating in efforts to preserve global food security (WTO)
There are three lines of action that appear closely aligned with the proposals presented in the EU FARM initiative and the German G7 Global Alliance on Food Security.
The first line of action is about keeping markets transparent. This is extremely important because in the short term, we know that food is there: the question is about physical and economic access, rather than availability.
The second line of action is about keeping markets open. Several initiatives are under way now at the WTO to prepare declarations that could be adopted during our ministerial meeting. Some are plurilateral (such as the FARM initiative). But we also have some Members discussing a multilateral declaration on food security, which appears to be a very real possibility.
Food for all to free for all: Unconcerned WTO make matters worse (Down to Earth Magazine)
As the world hurtles towards another food crisis, due to the Russian invasion of Ukraine, the spotlight has again shifted to the World Trade Organization (WTO) and its role in impeding the food security concerns of a host of developing countries. A central question that has divided economists, policy makers and humanitarian organisations is whether WTO has been the chief villain of the food crises in the new century. Has its complex and asymmetrical rules on subsidies embedded in its 1995 Agreement on Agriculture (AoA) exacerbated the vulnerabilities of poor developing countries while allowing the developed countries to continue with their lavish grants to farmers and exporters, and perpetuate the distortions it was pledged to reform?
Plastics dialogue discusses MC12 plans, next steps to implement Ministerial Statement (WTO)
Ecuador and China, co-coordinators of the IDP outlined some major developments in international fora in parallel with the IDP, notably the launch of negotiations at the UN’s Environment Assembly (UNEA) in March, which have the aim of reaching a global deal on plastics pollution by 2024.
DDG Paugam pointed out the importance of addressing plastic waste across the full life cycle of plastics, stressing that the initiative generates trade solutions and supports complementary international processes and activities. To that end, transparency is crucial, he said, suggesting that the IDP establish a global plastic value chain portal to monitor plastic trade flows and to share trade-related policies and measures. Many participants expressed strong support for the data portal.
Climate finance for SIDS is shockingly low: Why this needs to change (UNCTAD)
Small island developing states (SIDS) are the most economically vulnerable of all groups of developing countries, according to the Economic Vulnerability Index.
They are particularly vulnerable to natural, economic and health-related shocks beyond domestic control. The growing frequency and intensity of these climate shocks is a direct consequence of being in climate-sensitive areas or seismic zones, as well as the islands’ smallness. From commodities to manufactured spare parts, these states also rely heavily on imports of food and fuel, leaving them at the mercy of price spikes and shortages of essential goods.
For SIDS, enhancing resilience to more frequent and intense natural disasters means mobilizing more domestic and foreign resources for adaptation and mitigation. However, the COVID-19 pandemic has deprived many SIDS of tourism revenues – a crucial source of income for disaster risk reduction. In this context, climate finance is of particular interest to SIDS policymakers because of its role in funnelling resources to building climate-related resilience. However, at present, SIDS have little access to climate finance. Despite being hit hard by climate change while only contributing to 1% of global carbon dioxide emissions, they only had access to $1.5 billion out of $100 billion in climate finance pledged to developing countries in 2019.
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Red tape is strangling small businesses (Mail & Guardian)
The fundamental impact of governance failure, overregulation, and burdensome taxation in South Africa is that productive entrepreneurship as well as innovation have been crowded out. For example, early-stage entrepreneurial activity declined from 7.8 percent in 2008 to five percent in 2009, significantly lower than countries with a similar GDP per capita — but interestingly, similar to the entrepreneurship rate in Russia, an economy resource-rich and struggling with rent-seeking and corruption and where innovation has, as in South Africa, declined during the commodity boom.
What is clear from the evidence is that South African entrepreneurship has been on a seesaw journey, but largely declining for a long time. This is especially troubling because entrepreneurship is an engine of economic growth. It promotes the innovation needed to exploit new opportunities, promote productivity and create employment, while also addressing societal challenges, which now include the economic shock wave created by the Covid-19 pandemic.
Infrastructure must be maintained with climate change in mind (SAnews)
Public Works and Infrastructure Minister, Patricia de Lille, says recent flooding in the Eastern Cape and KwaZulu-Natal has highlighted the importance of building and maintaining public infrastructure with the mitigation of changing climate patterns in mind. The Minister was presenting the department’s budget for the 2022/23 financial year in the National Assembly on Tuesday afternoon.
“Recent events have again laid bare the importance of infrastructure and ensuring that we not only build new infrastructure but maintain existing infrastructure. We must build and maintain infrastructure taking the severe impacts of climate change into consideration,” she said.
Stats SA says tourism boosted trade at restaurants, takeaway outlets (IOL)
The increased tourism activity appear to have been good news for sales in the food and beverage sector.
The data shows income generated by the food and beverage industry, led by takeaway and fast-food outlets was closely followed by restaurants and coffee shops increased by 13.6%.
Stats SA said positive annual growth rates were recorded for income from food sales and the sector saw a strong improvement in activity with seasonally adjusted income rising 5% month on month in March, after a small 0.3% fall in February.
Egypt, S.Africa committed to advancing bilateral, continental cooperation as they resume joint committee (Ahram Online)
The ministers have agreed to hold the joint committee between Egypt and South Africa once every two years alternately in the two countries, as well as mid-term reviews at the level of senior officials.
During the meeting, Shoukry and Pandor said their governments are determined to establish an Egyptian-South African business council and remove nontariff barriers undermining trade between the two countries. The council will aim at encouraging the business communities in the two countries to make use of the multiple opportunities for trade and investment in each country, the ministers noted. They also urged activating cooperation between the authorities concerned with investments and commerce chambers in Egypt and South Africa to encourage and facilitate the participation of the private sector in the two countries’ economies.
The ministers agreed on taking further steps to achieve economic integration in the continent, including through boosting cooperation among existing sub-regional economic groupings. This is in addition to activating the Tripartite Free Trade Area (TFTA) agreement between the Common Market for Eastern and Southern Africa (COMESA) and the Southern African Development Community (SADC) and therefore activating African Continental Free Trade Area (AfCFTA).
China’s economic slowdown could hurt Namibia – Analysis (Namibia Economist)
The World Economic Outlook 2022 report released by the International Monetary Fund in April predicted that China’s economic slowdown could set back the economic recovery in emerging markets and developing countries, especially commodity exporters like Namibia. According to Theo Klein, an Economist at Simonis Storms, the Chinese government has embarked on a journey of transforming the economy from an investment-driven, export-oriented growth model to a sustainable development model since last year. He stressed that any decrease in demand for commodities from China will have a negative impact on Namibia’s exports, as China is Namibia’s second-largest trading partner on average. Over the last 5 years, China’s share of Namibia’s exports has averaged 19.1%.
Namibia mainly imports capital, consumer and intermediate goods, as well as clothing and textiles. With regards to SACU revenue, China is South Africa’s biggest importer and second-biggest importer of Namibia. “So, any major decrease in trade with China as a result of an economic slowdown in China will reduce SACU receipts and add pressure on public finances,” Klein said.
Uganda – DRC trade (The Independent)
Private Sector Foundation Uganda representing private sector business associations in partnership with Government of Uganda will hold the first ever Uganda- DR Congo Business Summit between May 31 and June 8 in Kinshasa and Goma located in the Democratic Republic of Congo. The summit is expected to attract more than 200 participants from Uganda and DRC and will open up new business frontiers as well consolidate trade relations between Uganda and DR Congo through discussions of business linkages, trade fairs and engagements between governments and businesses.
Speaking ahead of the Summit on May 19 at a media conference in Kampala, the PSFU Executive Director, Stephen Asiimwe, said the entry of DRC into the East African Community now provides the Uganda business community with an opportunity to trade in a market that has a population of more than 90 million people. The Uganda business community, he said, was yet to take full advantage of the opportunities that arise out of DR Congo, noting that it is also important to engage in high levels of innovation and creativity to diversify exports beyond food commodities and informal cross border trade.
“We can maximise trade by developing deeper links between domestic producers and external markets such as DR Congo,” Asiimwe said. Uganda’s trade with DRC has been growing over the years, increasing by an average of 10% annually.
During 2017, for instance, Uganda exported goods worth $188.98m (Shs685bn) to DRC while imports from DRC to Uganda stood at $156.5m (Shs567bn). However, this has exponentially grown, with Uganda’s exports to DRC increasing to $338.56m (Shs1.2tn) in 2021. The DRC is one of Uganda’s biggest trading partners in East Africa, with Uganda exporting mainly cement, palm oil, beer, sugar, iron and steel, rice, iron and steel (scrap), cocoa beans and natural rubber.
Dar, Accra trade volume notches 47bn/- (Dailynews)
TRADE volume between Tanzania and Ghana stood at 20.2 million US dollars (approximately 47bn/-) between the year 2016 and 2021, in which the former exported 6,434 metric tonnes of manufactured goods to the West African country.
Tanzania’s High Commissioner to Nigeria, who is also accredited to 15 countries in West Africa including Ghana, Dr Benson Bana, explained during an interview that balance of trade was in favour of Tanzania, which exported goods worth 15.2 million US dollars (about 34.9bn/-). On the other hand, Ghana exports to Tanzania stood at 2,533 metric tonnes with a total value of 5 million US dollars (about 11.5bn/-) during the period.
a two-day high-level meeting to discuss the implementation of a common agro-industrial park (CAIP) between the two countries. The objective of the meeting was to update the two Permanent Secretaries on the progress on the implementation of the industrial cooperation programme between the two countries focusing on the common agro-industrial park; discuss the funding opportunities for activities in the park; propose a possible location of the park; review the draft harmonized policy, legal, regulatory, and institutional framework for the park and agree on a roadmap for the initiative’s subsequent phases.
In her official opening remarks, Ms. Chalwe Chuulu, PS Ministry of Commerce, Trade and Industry (Zambia) welcomed the signing of the MOU on the joint industrialisation programme between the two countries under which CAIP was being implemented noting that it reinforces bilateral ties and that the initiative cements the strategic partnership between the two states.
he alluded to the central role of ECA, COMESA, United Nations Industrial Development Organization (UNIDO), African Development Bank (AfDB) and Afreximbank in promoting agro-industrialization through the park observing that the park had a regional significance as a model for cooperation and industrial development.
Dr. Mavis Sibanda, PS, Ministry of Commerce and Industry, Zimbabwe, noted that the meeting provided an opportunity to achieve a common understanding of the findings and recommendations of the prefeasibility study and lead to the identification of a possible location for the park, “let us take advantage of the Joint Industrialization Cooperation Programme as we anticipate opportunities coming out of the AfCFTA. Pooling resources will ensure economies of scale and will enable the two neighbouring countries to compete favourably on the market”.
Ghana and Mozambique agree to cooperate (Ghana Business News)
Ghana and Mozambique on Monday signed a joint permanent cooperation agreement to boost cooperation between the two countries. The two countries are looking to collaborate in the areas of agriculture, tourism, oil and gas, energy, education, trade and industry, environment, science and technology.
President Akufo-Addo emphasized that the COVID-19 pandemic and the on-going Russian war in Ukraine had established the fact that African countries should collaborate, share ideas and trade more among themselves to withstand the shocks of such occurrences in future.
AfCFTA: Nigerian trade structure threatens $450bn potential (New Telegraph Newspaper)
Despite coming late into the regional trade pact involving 55 African countries, indications emerged yesterday that Nigeria is on the verge of losing out in the $450 billion African Continental Free Trade Area (AfCFTA) agreement. Emerging developments indicate that lack of preparedness and unnecessary tariff barriers are some of the factors already putting a wedge in the free run of the unprecedented trade fellowship aimed at boosting the continent’s Gross Domestic Product (GDP). Other foreseen challenges are general political instability, inadequate trade infrastructure, transportation, poor port facilities and inconsistent agreement among member states.
Goving indication to this effect yesterday in Lagos, a freight forwarder, Mr Francis Omotosho, said Nigerian economy was plagued by microeconomic challenged as a result of poor infrastructure, poor access to capital and increased contractions in the Gross Domestic Product (GDP) growth in the post- COVID-19 era. He said this had led to competitive devaluation, adding that trade barriers were posing great obstacles to AfCFTA implementation.
“Payment providers currently have difficulties providing services. They include trade barriers manifested in form of discriminatory regulations, treatment of foreign providers, requirements for local incorporation, licensing, prohibition on cross border services or limitations in the movement of capital as well as intra trade barriers, difficulty in transmitting money from one country to another due to cross-border connection or the payment systems in either country.”
Buhari advocates closer synergy to address economic challenges (Daily Trust)
President Muhammadu Buhari has urged executives of banking institutions in West Africa to forge a closer collaboration to tackle economic challenges confronting the sub-region. The president made the call on Tuesday while receiving a delegation from the West African Bankers Association (WABA) led by its President, Thierno Seydou Nourou Sy.
President Buhari, who said over time global trade had become more complex and organised, expressed confidence that the rollout of the African Continental Free Trade Area (AfCFTA) would be a turning point in how African countries traded with one another.
Mali Economic Update: Resilience in Uncertain Times - Renewing the Social Contract (World Bank)
According to the World Bank Mali Economic Update 2022 entitled Resilience in Uncertain Times: Renewing the Social Contract, the country’s growing insecurity and socio-political crisis resulted in a timid, lower than expected, economic recovery in 2021. Growth prospect for 2022 has been further undermined by the economic sanctions, regional food insecurity, and the war in Ukraine.
The report points out that the Malian economy rebounded only slightly in 2021 (real growth estimated at 3.1% or 0.2% per capita) driven by the recovery in the sectors of agriculture and services, after the 2020 recession (-1.2%). The improvement in terms of trade during 2019-2020 as a result of the surge in gold prices, has considerably tampered in 2021 and removed one the main growth momentums.
African trade and economy news
Africa’s gross domestic product has recovered strongly in the last year, but the lingering effects of the Covid-19 pandemic, Russia’s invasion of Ukraine and the ensuing war could pose considerable challenges in the medium term. This is according to the 2022 African Economic Outlook, released by the African Development Bank on Wednesday.
Rising oil prices and global demand have generally helped improve Africa’s macroeconomic fundamentals, the report found. But growth could decelerate to 4.1% in 2022, and remain stuck there in 2023, because of the lingering pandemic and inflationary pressures caused by the Russia-Ukraine war. Both countries are major grain suppliers to Africa.
The theme of the 2022 African Economic Outlook is “Supporting Climate Resilience and a Just Energy Transition in Africa.” It highlights a growing threat to lives and livelihoods in Africa. The Bank launched the report during its Group Annual Meetings in Accra, Ghana.
Growing Intra-Africa Trade through Digital Transformation of Customs and Borders (WEF)
The digital transformation of customs and borders in Africa could improve efficiencies in processes, such as administration at customs and borders, and yield trade gains on the continent of $20 billion a year. A new report by the World Economic Forum, Growing Intra-Africa Trade through Digital Transformation of customs and borders, launched today at the Annual Meeting 2022 in Davos, provides a pragmatic perspective on the non-tariff barriers in border and customs services that can be exponentially improved through digital transformation to increase intra-Africa trade.
Kavitha Prag, Africa Lead, Enterprise Technology and Performance at Deloitte Africa, said: “The African Free Trade Area agreement can be a great catalyst for Africa’s growth and development, but its full realization hinges on the introduction of efficiencies, including the improvement of customs processes. Digital transformation of border posts and customs is thus a crucial and necessary step in the implementation of the protocol, especially for many of Africa’s landlocked countries.”
The report highlights insights from the Logistic Performance Index as well as key insights from case studies demonstrating the quantifiable value of digital reforms in countries such as Ghana, Kenya and Uganda. The paper is a call to action for more integrated digital reforms that can drive higher impact through public-private partnerships that sets the course for Africa’s post-pandemic recovery and growth.
Growing Intra-Africa trade through digital transformation of customs and borders
Lower trade barriers, Mpango tells Africa (Dailynews)
THE Vice-President Dr Philip Mpango has urged African governments to lower trade barriers and enhance infrastructure to benefit from the African Continental Free Trade Area (AfCFTA) opportunities. Dr Mpango further said that AfCFTA offers the continent’s countries a great potential for economic growth and development.
“Investing in technology that facilitates trade and financial transactions, as well as forming relationships with the private sector, international organizations and other governments is critical in increasing industrial productivity,” he said.
AfCFTA loses us5bn yearly to third party payment systems (The Business & Financial Times)
Economies of the African Continental Free Trade Area (AfCFTA) lose US$5billion in transactional cost to third-party foreign payment systems each year, the African Union Commissioner for Economic Development, Trade, Tourism and Industry, Albert Muchanga, has disclosed. Mr. Muchanga, who was speaking to the B&FT at the 6th Ghana International Trade and Finance Conference (GITFiC) in Accra, said the continent has made the right choice in adopting the Pan African Payment & Settlement System (PAPSS) as solution to the challenge. “Each payment that comes from the continent has to go to New York for processing and this costs Africa about US$5billion in transactional fee each year according to data from the African Union (AU),” he said.
Mr. Muchanga, however, affirmed that PAPSS presents an opportunity to trade and make direct payments in local currencies without going through any intermediaries which would exert extra cost on businesses in Africa.
Message of the Chairperson of the African Union Commission on the occasion of the celebration of Africa Day on 25 May 2022 (African Union)
The date of May 25 has a double evocative power. On the memorial level, it takes us back to the youthful freshness of the first moments of the OAU. At the geopolitical and institutional level, it constantly questions our individual and collective capacity to build the Africa then dreamed of by our founding fathers.
for the past ten years, Africa has been confronted with the challenges of terrorism, violent extremism and transnational crime (human trafficking, drug trafficking, arms trafficking).
The Continent is also faced with the disasters generated by bad governance, which can no longer be concealed by the demand for transparency imposed by a population that is increasingly open to the world through the new information and communication technologies.
Massive youth unemployment and the persistent precariousness of the women of the Continent are other challenges that call for urgent responses, because this category of the African population no longer accepts to be a passive spectator of its destiny. In addition to all these constraints, there is the economic crisis which is burdened by the debt, the climate and energy crisis which, in turn, affects food prices through the exorbitant cost of transport, while the health crisis following the outbreak of COVID-19, weakens the production capacities of the various economic agents.
The most emblematic sign of these fragilities is the food crisis following the climatic disorders, the health crisis of COVID-19, amplified today by the conflict in Ukraine. This crisis is characterised by a shrinking world supply of agricultural products and a soaring inflation of food prices.
So, what to do in the face of all these challenges? There is, for example, the courageous Institutional Reform of the African Union undertaken since 2016 and whose aim is to improve the governance of the Institution and make it a key player in multilateralism. Then there is the African Continental Free Trade Area (AfCFTA), which entered into force in 2021, making Africa the largest common market in the world and accelerating Continental integration. It reinforces the measures taken in terms of free movement of persons and goods.
Use AU Day to remove hindrances to AfCFTA - Victor Yaw Asante (Graphic Online)
Governments, regulators and other relevant stakeholders in Africa have been asked to use the African Union (AU) Day to forge a fresh collaboration that will help remove all trade barriers from the continent. That will help further the African Continental Free Trade Area (AfCFTA) agreement.
“We believe that Africans have not been able to trade among themselves enough and this is the reason AfCFTA was designed to encourage intra-African trade, but more than a year after trading began, there are still challenges which need a collaborative approach from all stakeholders to address,” Managing Director (MD) of FBN Bank, Victor Yaw Asante stated.
Pan-African integration has made progress but need (Modern Ghana)
Africa Day 2022 (UNWTO)
Africa is endowed with 70% of arable land and agriculture is one of the most important economic sectors in the continent. To be sure, there are many challenges to address to transform the sector, to make it more sustainable and to secure food access and distribution. But we have good reason to be optimistic about the future. Africa is home to the fastest growing urban populations on Earth and its growth is being driven by a buoyant youth possessing incredible talent and ingenuity. Moreover, tourism is returning across Africa, and our sector has the power to deliver positive change and inspire transformation.
Africa is rich in immense natural and cultural resources and the diversification of the economy through tourism will be key to build resilience against external shocks and so build economic stability and greater food security. Domestic and regional intra and inter tourism are valuable sources of income and can boost infrastructures. The African Continental Free Trade Area (AfCFTA) and the Single African Air Transport Market (SAATM) are paramount for advancing Africa’s agenda on sustainable development.
Africa Day 2022 – Africa’s Year of Nutrition (African Business)
Africa Day is observed annually to commemorate the founding of the Organisation of African Unity (OAU), which was created on 25 May 1963. It was the precursor of the African Union (AU). Africa day provides an opportunity to celebrate the socio-economic achievements of the continent and in line with the African Union Theme for the year 2022 “Strengthening Resilience in Nutrition and Food Security on the African Continent”, the development agency of the African Union Auda-Nepad held an online celebration focusing on moving forward this agenda.
“I would like to call on all of us to work together and do the right thing for the constituencies and people that we serve. We owe it to our constituencies and our people, explicitly the children – they are the future leaders of tomorrow. We cannot groom a leader that is malnourished and does not have the capacity to perform. We should talk less and do more,” said Boitshepo Bibi Giyose, senior nutrition office at Auda-Nepad.
The general objective of the AU Year of Nutrition for 2022 is to secure greater political commitment and investment in nutrition to address ongoing nutrition challenges.
Africa provides a ‘home for hope’, despite new challenges: Guterres (UN News)
Egypt works side by side with African countries to achieve sustainable development: Sisi on Africa Day (Ahram Online)
‘Africa Rising’ - law and investment quotes in celebration of Africa Day (Bizcommunity)
On 25 May 1963, the Organisation for African Unity was established in Addis Ababa, Ethiopia to promote unity, solidarity, collaboration and development amongst African member states. To celebrate this important day, Baker McKenzie partners and its African Relationship Firm colleagues share some of their thoughts on the many opportunities that the continent offers.
“Recent developments across the African continent show that the idea of ‘Africa Rising’ remains true and alive. With trade liberalisation through the Africa Continental Free Trade Area Agreement (AfCFTA), a fast growing population and increased technology penetration, the opportunities in Africa’s key markets continue to expand. What many see as challenges in Africa, are in a manner of speaking, Africa’s greatest strength for investments and growth.” - Ijeoma Uju, Partner, Templars, Nigeria.
ERCA to coordinate ECOWAS Member States’ positions on Draft AfCFTA Protocol (News Ghana)
The ECOWAS Regional Competition Authority (ERCA) organized a meeting of a Working Group for the review of the Draft AfCFTA Protocol on competition, prior to the fifth meeting of negotiations between African Union States Parties that is scheduled to hold in Accra, Ghana from 30 May to 2nd June 2022 on the said draft. The meeting took place from 19 to 21 May 2022 at Hotel Flamboyants in Saly, Republic of Senegal. The purpose of the meeting was to bring together a number of ECOWAS Member States (Gambia, Nigeria, Senegal) and ERCA officials for a brainstorming on the draft AfCFTA Protocol on competition in order to ensure that all Member States adopt a common position on all the provisions of the draft AfCFTA Protocol to be shared with Member States’ negotiators and other regional organizations. During the opening ceremony and in welcoming the participants, the Executive Director of ERCA, Dr Simeon Koffi informed the delegates that the meeting was convened to consider the draft AfCFTA Protocol on Competition Policy and harmonise and coordinate the position of Member states on the Protocol.
Kagame pushes for AfCFTA full realization at WEF (The New Times)
President Paul Kagame has said that even with the current trading under the African Continental Free Trade Area (AfCFTA) agreement, there is need to tackle a number of things, especially non-tariff barriers. The head of state was speaking in Davos, Switzerland at a breakfast gathering of African leaders and friends of Africa on the AfCFTA and the bloc’s role in fast-tracking economic growth and transforming the continent. The ceremony is part of sideline events at the ongoing World Economic Forum (WEF) Annual Meeting that kicked off Monday, May 23.
President Kagame said that for so many decades in history, there have been African leaders who tried to unite Africa, and also making sure that the continent can also trade within itself and countries with each other among others.
However, President Kagame observed, with time, there was a huge improvement that Africa accepted reforms and also accepted that first, we need to have even private sector-led economies where the private sector started taking center stage.
President Mnangagwa calls for Africa to prioritise food security (The Herald)
The African continent’s priority today is to secure food security since its regions have enough fertile land to feed its people, President Mnangagwa has said. Speaking today at the ongoing World Economic Forum in Davos, Switzerland, during a discussion on the Africa Continental Free Trade Area (AfCFTA) running under the theme “Friends of the African Continental Free Trade Area”, which he was co-chairing, President Mnangagwa said to secure food for the continent, Africa has to adopt the “eat what you kill” philosophy as well as not to “reinvent the wheel.” This philosophy, according to President Mnangagwa, will work if there is cooperation from those who have developed, industrialised and mechanised agriculture and have access to technology. He added that Africa also has to put in place mitigatory measures against climate change, a key focus area at AfCFTA.
His comments come as the world is currently facing serious food shortages, brought by changing climate change and the supply chain disruptions brought about by the Covid-19 pandemic as well as the ongoing conflict between Russia and Ukraine.
The later has sent global food prices skyrocketing. Africa can, however, secure food security if there is cooperation among nations.
Focus on Africa’s interest: President charges states, financial institutions (Graphic Online)
President Nana Addo Dankwa Akufo-Addo has challenged African nations and their financial institutions to come up with a new economic model that will serve the interest of their peoples and not profit advanced nations. That, he explained, was necessary because “profits from our resources have benefited foreign creditors for far too long, while we suffer abusive borrowing cost on the international capital markets”.
Premier: Investments in remote areas paved way for early Covid-19 recovery (The New Times)
Prime Minister, Edouard Ngirente, has said that the government’s investments in rural areas were part of the drivers of rapid economic recovery from the Covid-19 effects. He was speaking during the presidential dialogue on ‘Africa’s Development Challenges and Opportunities’ at the opening ceremony of the 57th African Development Bank Annual Meeting in Accra, Ghana on May 24. “During the pandemic, cities were not working properly because of different lockdowns, but in some remote areas there were not many cases of Covid-19, so we decided to go and invest there,
He said that the overall process of economic rebound was driven by four key components of the recovery programme. These include; the Economic Recovery Fund— which was designed to help the most hit sectors such as hospitality, transport and other economic activities; the Manufacture and Build to Recover Programme; subsidies given to the agriculture sector; and an ongoing project to set up a bulk blending fertilizer and storage plant in Bugesera Industrial Park.
Digital connectivity an economic imperative for East Africa (The East African)
Digital connectivity provided by Telco’s and Mobile Network Operators (MNOs) is well placed to make a positive impact on the access to resources by women, ‘formalise’ informal employment and improve on the access to education for all. Communication and internet access are transformational, they empower citizens to meaningfully contribute to their countries’ economies, and shape sustainable economic futures. “The ever evolving supply of technology gives rise to life enhancing opportunities. The more technology penetrates into our communities, the more we can expect everyday problems to be resolved by its use. One fascinating example is of tele-medicine where patients need not travel vast distances to reach doctors, rather get to a connected centre and get consultations and in some cases, have surgeries performed remotely,” said Sitholizwe Mdlalose, Vodacom MD
African Union head to push Russia, Ukraine to unblock grain exports (Successful Farming)
Senegal’s president and African Union chairman Macky Sall said on Wednesday that when he visits Russia and Ukraine in the coming weeks he will push them to unblock exports of grains and fertilizer to avoid widespread famine. Africa is suffering from disruptions in food supply and soaring prices of basic goods and risks “disastrous consequences” if the situation endures, Sall said during a conversation with philanthropist Mo Ibrahim at the Ibrahim Governance Forum. Nearly half of Africa’s 54 countries rely on Russia and Ukraine for wheat imports, according to the United Nations Food and Agriculture Organization. Russia is also a major supplier of fertilizer to at least 11 countries. “We have pleaded for a ceasefire, for an end to the war and for the release of all food products ... so that the world doesn’t know a famine after two years of COVID and almost three months of war,” said Sall. Russia invaded Ukraine in late February.
“There are multiple initiatives to call on countries that have (grain) stocks to liberate them ... and to ensure that Russia can authorize the export of cereals from Ukraine and can also export itself. This is the African position,” he said.
The African Development Bank Group’s annual meetings officially opened on Tuesday with a ringing endorsement of the institution by the Ghanaian government and a call on member countries to back the institution as the main engine for the continent’s economic growth.
Speaking at the formal opening ceremony, Ghanaian president Nana Dankwa Akufo-Addo spoke of the continent’s ongoing fiscal and socioeconomic challenges and the importance of the African Development Bank to the continent’s development goals.
“What is clear is that the resulting damage cannot be cured so easily with the limited fiscal tools at our disposal and national policy adjustments. Therefore, I reiterate my call for an elevated role for Africa’s premier bank, the African Development Bank,” Akufo-Addo said.
Ghana’s finance minister, Kenneth Ofori-Atta, who is at the end of his term as current chairman of the African Development Bank Group’s board of governors, said the stakes were high and spoke of the risk of a lost decade. Africa’s economic growth contracted by 3.2% in 2020 and debt-to-GDP ratios edged up from 60% to 71.1%, Ofori-Atta noted. The minister said, however, that it was not all bad news.
The theme for the African Development Bank Group’s 2022 Annual Meetings is “Achieving Climate Resilience and a Just Energy Transition for Africa.”
Akufo-Addo, Adesina, others chart new path to Africa’s economic freedom (The Guardian Nigeria)
Prominent African leaders, yesterday, took turns to examine the continent’s development agenda, admitting the future is in danger if it does not take its affairs into its hand and chart a new course.
They warned that there is no better time to take proactive actions and secure long-desired economic freedom, noting that Africans could only turn to western countries for support at their own peril. They spoke at the opening ceremony of AfDB’s Annual General Meeting (AGM) held in Accra, Ghana, with a focus on the most troubling challenges facing Africa: climate change adaptation, just energy transition and food crisis.
After the opening ceremony, the leaders dissolved into a presidential dialogue where they debated extensively on the overwhelming challenges facing the continent: rising sovereign debts, narrowing financing options, energy shortage, low infrastructure, climate change vulnerability and food crisis.
Akufo-Addo, the chief host of the AGM, sought the collaboration of African leaders to expand the role of AfDB in the development agenda of the continent and warned that the skewed global financial system cannot support its aspiration for economic emancipation.
Make positive impact on the continent - African Trade, industry players urged (News Ghana)
The Ghana International Trade and Finance Conference (GITFiC) has organised its 6th conference in Accra with a call on participants to use the knowledge gained to make positive impact on the Africa continent.
“We are in the face of transition towards a brighter future for Africa, towards deepening relationships, towards fulfilling intra-Africa trade and transition from the pandemic.”
Mr Tsonam Cleanse Akpeloo, Chairman, Association of Ghana Industries (AGIs)
Said. The transition signified hope and potential for tremendous change and that the AGIs held the key to transforming Africa continent by impacting the lives of ordinary African, nations and generations.
The two-day conference would have panel discussions on the first day on the topic: “Towards an Effective and Efficient Mobile Money Transactional Penetrations in Africa; A Catalyst to solving Cross Border Payment and Settlement, an Anticipated – Barrier within the AfCFTA; – The Role of Financial Regulators and Stakeholders.”
“Measuring the Acceptability and Adaptation Level of the AfCFTA on the African Continent a Year after Implementation of the 1st Phase; – Where do we stand in terms of Trade in Goods, Tradce in Service, and Dispute Resolution Protocol (Policy Direction) with focus on the Role of Africa’s Local Governance Structures in preparing their various Business Communities to take advantage.”
Building models for climate resilience and a green recovery (UNECA)
The COVID-19 pandemic led to a great disruption of lives and livelihoods, and therefore a substantial economic shock globally. This was especially true for the countries of Africa, many of which had very low institutional capacity to deal with a sudden public health crisis, and low budgetary capacity to fund a pandemic recovery stimulus thereafter.
But one way of thinking about a recovery from such a sudden and multidimensional crisis is to treat it like a model, or bridge, to building resilience for the future effects of climate change. The impacts of climate change are expected to be much more considerable (albeit unfolding at a slower pace) and certainly more long-lasting. Only a small share of the fiscal stimulus packages is explicitly green. Yet recent global economic studies suggest that green spending can secure both greater growth and a greener future.
Kragha oil gas experts offers solutions to cleaner petroleum refineries across Africa (Vanguard)
Without this, the stakeholders who gathered at the second Refining & Specifications Virtual Workshop organised by the African Refiners and Distributors Association (ARDA) noted that achieving net-zero, Paris Agreement and other agreements targeting cleaner environment may remain elusive.
With growing divestment and capital reallocation away from hydrocarbons and into renewables/energy transition, the stakeholders noted that consideration for Environmental, social, and governance (ESG) is the downstream segment of Africa’s petroleum industry now remained a key leeway to the over $15.7 billion required for the continent to improve its refineries.
Regional business community upbeat about CHOGM (The New Times)
Rwanda’s High Commission in Tanzania and the East African Business Council (EABC) and other stakeholders on Tuesday, May 24, organised a roundtable with regional business executives in Dar es Salaam in preparation for the upcoming Commonwealth Heads of Government Meeting (CHOGM) slated for June 21 to 26, in Kigali.
John Bosco Kalisa, CEO of the EABC added: “The major outcome is the commitment of the CEOs to participate in the event and share insights and knowledge on the doing business in the region as well as at continental level taking advantages of the EAC Customs Union and Common Market [protocols] as well as the AfCTA. And building synergies and partnerships in areas of trade, technology, energy, environment as well as regional and continental value chains.”
The EAC is negotiating AfCFTA as a bloc and, the latter on February 18 made a huge step forward by adopting the bloc’s tariff offer for Category A products amounting to 90.2 per cent to be liberalised in 10 years after the start of trading under the continental trade deal.
UNDP: New crises looming in Africa in wake of War in Ukraine (UNDP)
In a new report, the United Nations Development Programme (UNDP) warns of the direct and indirect impacts of the war in Ukraine on the African continent, which could further stall the continent’s development trajectory already significantly jeopardized by the COVID-19 crisis. This report, entitled “The Impact of the War in Ukraine on Sustainable Development in Africa”, reinforces findings of the Global Crisis Response Group (GCRG) that the war in Ukraine is pushing the 2030 Sustainable Development Goals and the aspirations of the African Union’s Agenda 2063 further out of reach, and provides key recommendations for actions that need to be taken immediately, to avert further crises in Africa.
According to the report, some of the direct impacts of the crisis in Africa include trade disruption, food and fuel price spikes, macroeconomic instability, and security challenges. African countries are particularly affected due to their heavy reliance on imports from Russia and Ukraine.
UNDP’s new report proposes three main areas of action that could mitigate the impact of the war in Ukraine on Africa.
Global economy news
New study looks at challenges and opportunities of LDCs’ accession to WTO (WTO)
The report — “Accessions of Least-developed Countries to the WTO — Challenges and Opportunities” — summarizes the commitments undertaken by the nine LDCs who have acceded to the WTO under Article XII of the Marrakesh Agreement. It also looks into the challenges and opportunities for LDCs regarding WTO membership, including the importance of participating in WTO activities. The paper also briefly examines the economic performance of recently acceded LDC members to see how they have fared since joining the WTO.
The impact of the war in Ukraine on Trade Policy (Lexology)
The war in Ukraine will change the world in many ways. One change that deserves more attention is how it is impacting trade policy and thus changing trade flows and creating trade opportunities.
Economic sanctions are traditionally considered to be coercive measures that are designed to bring about a change of behaviour. The point is not to punish but to change behaviour. They are also normally designed to maximise the economic pain on the target while minimising that on the parties imposing the measures.
For this reason, trade measures are traditionally designed to be temporary with built-in expiry dates and sanctioned assets are normally frozen, not confiscated.
Trade sanctions are most effective where they are universal. Unilateral sanctions can be avoided by trade diversion, especially in the case of commodities and other fungible goods. For this reason, many sanctions regimes are applied extraterritorially, although there are often legal and practical limits to this.
Most Favoured Nation Treatment (“MFN”) is the foundation of the GATT/WTO system and exceptions are limited and well-defined. There is no WTO mechanism for suspending or removing MFN status or even for ejecting a member from the organisation. There are security exceptions that allow restrictive trade measures on both goods and services trade to be taken against a WTO Member, notably “in time of war or other emergency in international relations”. A number of countries including the G7 and the EU have announced that they have suspended MFN treatment of Russia. What they mean by this is that they consider the restrictive measures concerning goods and services that they are taking against Russia are justified by the national security exceptions.
New Initiative to Strengthen Cross-Border Investment in the Digital Economy (WEF)
A pioneering effort to facilitate cross-border investment in the digital economy was launched this week at the World Economic Forum Annual Meeting 2022. The new initiative on digital foreign direct investment, the Digital FDI initiative, will implement projects in several countries to help grow Digital FDI, as the reforms to attract such investment must take place at a country level. The first digital FDI project will take place in Nigeria.
Attracting Digital FDI requires creating digital-friendly investment climates through targeted and country-specific policies, regulations and measures. These investments involve new business models, often based on data and technology, and platform economies, as well as using non-traditional assets. The Digital FDI initiative will aim to identify and implement enabling reforms through public-private projects in emerging markets and developing countries.
“As the first and only global multilateral focused on enabling digital prosperity for all, the DCO is partnering with the Forum on a Digital Foreign Direct Investment initiative to help countries develop digital FDI-friendly investment climates. We invite digital innovators with a commitment to economic development and inclusion to join us,” said Deemah Al Yahya, Secretary-General, DCO.
Advancing Digital Cooperation (WEF)
In 2023, the United Nations aims to agree a Global Digital Compact, a multistakeholder understanding between states, the private sector and civil society on how to achieve the Roadmap for Digital Cooperation. In the broader context, digital cooperation spans topics such as connectivity, artificial intelligence, Internet governance, safety and security, and data governance; all of which mandate the involvement of all stakeholders, not only governments. Will digital cooperation change the way we think about governing?
Middle East and North Africa’s Commodity Importers Hit by Higher Prices (IMF)
The war in Ukraine and related sanctions have triggered a sharp increase in commodity prices, which will add to the challenges facing countries in the Middle East and North Africa—particularly the region’s oil importers.
After leaping to a peak of $130 per barrel following Russia’s invasion, oil prices are expected to settle at an annual average of around $107 in 2022, up $38 from 2021, according to the IMF’s latest World Economic Outlook. Similarly, food prices are expected to increase by an additional 14 percent in 2022, after reaching historical highs in 2021.
This surge in prices comes at a precarious time for the region’s recovery. In our Regional Economic Outlook, we revised up our forecast for growth in the Middle East and North Africa as a whole by 0.9 percentage points to 5 percent, but this reflects improved prospects for oil exporters helped by rising oil and gas prices.
For oil-importing countries, we marked down our projections, as higher commodity prices add to the challenges stemming from elevated inflation and debt, tightening global financial conditions, uneven vaccination progress, and underlying fragilities and conflict in some countries.
Middle East Container Ports Are the Most Efficient in the World (World Bank)
World Bank and S&P Global Market Intelligence container port performance index shows ports in the Middle East and East Asia responded best to the heavy volume growth and service volatility caused by impacts of the global pandemic
“Increasing the use of digital technology and green fuel alternatives are two ways countries can modernize their ports and make maritime supply chains more resilient,” said Martin Humphreys, Lead Transport Economist at the World Bank and one of the researchers behind the index. “Inefficient ports represent a significant risk for many developing countries in that they can hinder economic growth, harm employment, and increase costs for importers and exporters. In the Middle East, heavy investments in container port infrastructure and technology are proving to be effective.”
Agriculture negotiators strive for results in final stretch to Ministerial Conference (WTO)
Amb. Abraham Peralta told the meeting that Director-General Ngozi Okonjo-Iweala has suggested a three-track informal process focusing on: a food security declaration as an immediate response to current challenges; a proposed Ministerial Decision that would exempt food bought by the World Food Programme (WFP) from export restrictions; and an outcome that would guide negotiations on all agriculture topics after the Ministerial Conference has ended.
FTI report highlights importance of urgency on energy transition (Engineering News)
This year represents a critical inflection point in the way that energy is perceived, and the global systems needed to find, produce, deliver and decarbonise it, a new report by global business advisory firm FTI Consulting emphasises. “Significant, era-defining events are happening all around us, all around the world, and all at a breakneck pace – shaping both short- and long-term structural considerations around energy and sustainability,” the company says.
Report: State and Trends of Carbon Pricing (World Bank)
providing an important source of funds to help support a sustainable economic recovery, finance broader fiscal reforms, or invest in communities as part of the low-carbon transition future, according to the World Bank’s annual “State and Trends of Carbon Pricing” report released today.
“The past year has seen some very positive signs, such as the significant increase in revenue that can be invested in communities and in supporting the low carbon transition. There is also good progress towards resolving cross-border issues related to carbon pricing and the adoption of new rules for international carbon markets that was agreed at COP26 in Glasgow, which helps set a clearer policy direction,” said Bernice Van Bronkhorst, Global Director for Climate Change at the World Bank. ”It is important now to build on this momentum and really ramp up both the coverage and the price levels to unlock the full potential of carbon pricing in supporting inclusive decarbonization.”
Key topics covered in the State and Trends of Carbon Pricing 2022 include cross-border approaches to carbon pricing, challenges and opportunities from rising energy prices, and new technologies and governance frameworks shaping carbon markets.
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Local news
Perfect storm has hit this industry in South Africa – and in turn, consumers (BusinessTech)
South Africa is staring down the barrel of yet another huge fuel hike in June – as much as R3.50 per litre – due to stubbornly high oil prices, and a volatile rand. This has created the perfect storm in the road freight logistics sector, according to Gavin Kelly, chief executive officer of The Road Freight Association. “No one would have thought that we would see such increases in the fuel price as we have experienced over the past six months. “As we reel from these increases, the possibility of one of the greatest price increases that we have ever seen is looming,” he said.
The Russia-Ukraine conflict and resultant sanctions on Russia have disrupted global energy and food trade, increased logistics costs, and fanned inflationary pressures, creating a challenging environment for businesses and policymakers alike.
“Trade with Russia and Ukraine will suffer, adding to already strained global supply chains. Longer-term, sanctions and a reduction in trade with Russia, could result in the redrawing of some supply chains and trade routes, but this all takes time and comes at a cost,” said captain Rahul Khanna, global head of Marine Risk Consulting at AGCS. Ships need fuel, and those costs are rising, said Kelly. There are still fewer ships at sea due to the pandemic, and there are constraints in the global logistics chains that not only articulate into delays, but into demand, which has an upward price-pressure effect, he said. “Once goods are landed, they then find their way to either consumers or manufacturers via the dependable road transport network, and that is where the next leg of the logistics journey is impacted by fuel increases. We have all felt, and will continue to feel for some time, the effects of more expensive fuel.”
South Africa Seeks Indian Investments In Special Economic Zones (Businessworld)
Indian companies can reduce their lead time to access the African market to three days from eight days by investing in South African Special Economic Zones, said a top official from the South African consular office in Mumbai. “There are more than 13 Special Economic Zones in South Africa, where Indian companies can invest and export to entire Africa, USA and European Union, with which we have trade agreements,” said Andrea Kuhn, Consul General, Consulate General, South Africa in Mumbai. She was speaking at an interactive session organised by MVIRDC World Trade Center Mumbai and the ‘All India Association of Industries’.
Dean Hoff, Consul Economic, Consulate General, South Africa, “In agro-processing, we are negotiating with the Indian government to export avocado, table grapes and litchis.” Indian companies can invest in the agriculture value chain in South Africa as we are a major producer of citrus fruits, maize, corn, soyabean, sugar and dairy products, Hoff said.
“But still bilateral trade volume is around USD 15 billion, which can be enhanced with the dynamic initiatives of the South African Consul General in Mumbai. In order to stimulate trade and investment with South Africa and the entire African continent, WTC Mumbai and AIAI proposes to organize an Africa Conclave in association with all the trade missions of African countries in India in future,” Kalantri said added.
Namibia ready to work with other African countries for the realisation of Agenda 2063 – DPM (Namibia Economist)
Namibia is ready to work with other African countries for the realization of Agenda 2063, an official said Monday at the commencement of the Discover Namibia Intra – Africa Expo and Business Summit at the coastal town of Swakopmund.
Speaking at the event, the Deputy Prime Minister and Minister of International Relations and Cooperation, Netumbo Naandi-Ndaitwah in a statement said the government supports proactive initiatives, like the establishment of the Africa Economic Leadership Council and its programmes such as the summit. “Such unique initiatives add value to the Africa Continental Free Trade Agreement (AfCFTA) and provides practical meaning to the implementation thereof,” she added. Naandi-Ndaitwah believes that such initiatives will empower more young people, thus enabling them to play a significant role in the mainstreaming of the economy as that is the main objective of African leaders.
“The implementation of the AfCFTA provides an opportunity for job creation and greater market access. As well as the further support of the regional and continental goals on regional integration in respect to the SADC within the AU roadmaps of development,” she added.
“If we continue the culture of exporting raw materials out of the continent without value addition happening in Africa, we must know that we are exporting African jobs to other countries. These, leaves African youth in poverty, forcing them to risk their lives on the high seas running after their jobs whereby, they will be labelled as illegal immigrants,” she said.
Kenya coffee output set to fall 10pc on fertiliser crunch (Business Daily)
Kenya’s coffee production in the 2022-23 season is projected to drop by 10 percent to 700,000 bags on the back of rising prices of fertiliser, the US Department of Agriculture (USDA) says in a newly published report that tracks coffee production in the country. The surge in global fertiliser prices began at the beginning of 2021 due to the impact of the Covid-19 pandemic. The ongoing war between Russia and Ukraine has worsened the situation. Currently, fertiliser prices in Kenya stand at Sh6,000 per 50 kilogramme bag, a 71 percent increase from a year earlier. The rise in prices is also due to producer countries such as China, Russia and Turkey restricting exports to protect their farmers compounded by heavy consumption demand from India, Brazil and US buying up large quantities, hence reducing available global supplies.
Uganda leads East Africa in fully switching to e-passport (Business Daily)
Uganda has become the first East African Country to fully shift to the new electronic passport, beating fellow EAC members who have been deferring the implementation deadline for the new secure documents. Ugandans who have not acquired the new generation passport now cannot travel out of Entebbe after the country phased out the old document reading machines. The decision to adopt a new generation of passports and phase out old ones was reached by the EAC heads of state in March 2016 in Arusha, Tanzania. Kenya has pushed the deadline for acquiring new generation passports to November after it missed out on an earlier one that had been set for December last year. EAC Secretary General Peter Mathuki in a recent news conference urged members state that have not implemented the e-passport requirement to fast-track the implementation.
“We are encouraging all member states to adopt the new passport in line with the EAC directive,” said Mr Mathuki in a virtual news conference with the journalists.
Poor value addition culture limits Nigeria’s export benefits (Businessday)
Nigeria’s export benefits despite its potentials are limited by poor value addition culture in the country, as focus is placed more on the instant profits received from exporting raw materials alone, data has shown. The global economy business and economic data for manufacturing value added ranks Nigeria 40th out of 153 countries with 38.32 percent which is below the average mark of 50 percent signifying that more efforts need to be made in growing the value addition culture. According to the Nigerian export promotion council (NEPC), Nigeria is the fourth largest producer of cocoa worldwide covering 6.5 percent share of global production with cocoa beans accounting for almost 90 percent of the $804 million of Nigerian cocoa exports.
However, data from the Nigerian Export-Import Bank (NEXIM), shows that Nigeria poor engagement in value addition activity is causing Nigeria to lose from the global cocoa and chocolate market as it shows that the global value of raw cocoa export is $10 billion while the total value of all finished goods from cocoa annually is $200 billion with chocolates alone having $100 billion.
This means that despite providing 73 percent of global cocoa production, Africa (Nigeria inclusive) is simply scratching the surface in terms of profits as it enjoys less than 5 percent of the wealth obtained from the value addition process.
Textile Industry: Still on the Brink (This Day)
Stakeholders in the Nigerian textile industry have argued that only urgent intervention by the federal government would save the industrial sector
The President of the Nigerian Textile Manufacturers Association (NTMA), Mr. Folorunsho Daniyan, arrived at the scheduled press conference on the state of the textile industry on May 12, 2022, conscious that the textile industry in Nigeria is on the verge of collapse.
He said: ”Ordinarily, the year marking our 65th anniversary (which is this year) should have been time for celebration and popping of champagnes. But this, sadly, is not our situation. If the truth must be said, our industrial sector is dying and needs urgent interventions from the federal government to keep it alive.”
Nigerian textiles used to be a key manufactured product that was exported through the formal channels and by way of cross-border trade in West and Central Africa. However, the export of textile products suffered a setback between 2003 and 2008. Textile exports touched their lowest ebb in 2006 however recovered some lost ground in 2007and 2008. Today, the situation is even worse as our exportability is next to zero.”
Nigeria Imports Refined Petroleum Products Worth $28bn Yearly, Says Energy Consultant (This Day)
The cost of importing petroleum products of all kinds into Nigeria has soared to over $28 billion on an annual basis, Blackgold Energy Authorities, an oil and gas consulting and advisory firm, has revealed. The Principal Consultant, Blackgold, Dr. Oladunni Owo, disclosed this yesterday in Lagos at the ongoing two-day Nigerian Content Midstream/Downstream Oil and Gas Summit, with the theme: “Towards Maximising Potential in the Midstream and Downstream Oil & Gas Sector – A Local Content Perspective.” “Nigeria’s total import for petroleum products is about $28 billion per annum. Nigeria is the largest producer of crude in Africa and third largest importer of refined products in Africa. “Nigeria’s per capita refining is about 0.002 barrels per day, that’s very embarrassing,” she stated.
No Plan to Withdraw Naira Notes from Circulation, Nigeria’s Central Bank Clarifies (Arise News)
The Central Bank of Nigeria (CBN) on Saturday debunked reports that it planned to replace the conventional Naira notes in circulation with digital currency, otherwise known as the eNaira, in due course. This is as the African Development Bank (AfDB) Group’s Board has approved a $ 1.5 billion facility to support African countries deal with the impact of the Russian-Ukraine war impacting food prices and availability. CBN’s Director of Corporate Communications Department, Mr. Osita Nwanisobi, said the misleading statement purportedly made at a stakeholders’ engagement on eNaira adoption in Asaba, Delta, was misconstrued and therefore, urged the public to completely disregard it.
Nwanisobi further explained that the digital version of the Naira is meant to complement the existing currency notes and therefore, would circulate simultaneously with the conventional Naira notes as means of exchange and store of value.
He said the adoption of the digital legal tender, aside from its safety and speedy features, would also ensure greater access to financial services by the underbanked and unbanked populace thereby enhancing financial inclusion. He urged the public and business owners to embrace digital currency as it offers more possibilities.
An increased role for private sector: Mozambique’s new regulatory policy in the off-grid energy sector (Brookings)
Recently, Mozambique’s growth trajectory has been driven by pandemic-related restrictions, the conflict in Cabo Delgado, extreme damage by tropical storms, and by commodity output and prices. Moreover, the hidden debt scandal in 2016 also impacted external funding in the country. Not all is negative—at the same time, new opportunities in the energy sector are opening doors for an economic boost. More specifically, the country is taking steps into a new direction toward creating an environment that enables private investment in the off-grid sector leading the country towards a more positive trajectory.
Mozambique’s electricity sector has traditionally been state-directed and in the recent years, the energy sector’s efforts have strongly focused on the development of gas reserves in the northern part of the country. It also faces structural challenges such as non-cost-reflective tariffs that limit its ability to direct sufficient investment into increased energy access. The country aims to achieve universal energy access by 2030 and major investments are needed. The important role of off-grid solutions and the private sector in contributing to the national goal of universal energy access is outlined in various sector policies, but the policy environment has not been conducive to this developmental trajectory due to lack of a specific licensing regime.
WTO accession for the Comoros moves towards final stages (WTO)
Mr Mzé Abdou Mohamed Chanfiou, Minister of Economy, Industry and Investment, and WTO chief negotiator noted that despite the recent successive external shocks suffered by his country, which is a net importer of more than 60 per cent of its basic necessities, the Comoros remains committed to the bilateral and multilateral aspects of negotiations, with a view to concluding the accession process in a timely manner.
“The accession process is making remarkable progress, to the point of having concluded bilateral negotiations with Japan, Brazil, Canada, the United States and the European Union, opening the prospect of the Comoros’ formal accession to the WTO this year, 2022.
“We must recognize and salute the Comoros’ determination, dedication and dynamism,” said the chair, who also recognized the contribution by WTO members by actively engaging with the Comoros and ensuring that this accession file continues to receive due attention. In addition, trade-related technical assistance provided by international development partners has contributed enormously to the process of accession.
Soy, the magic bean of Togo’s economy (Trade for Development News)
In 2020, Togo, a tiny country squeezed between Ghana and Benin in West Africa, was the first exporter of organic soybean to the European Union, ahead of China and India. This was unthinkable just five years ago.
Soybean is not indigenous to Togo. It was introduced to the country in the 1980s by the German Development Cooperation (GIZ) to provide protein-based food supplement to reduce malnutrition. Testing the different types of beans is important to selecting the varieties best matched to Togo’s soil and climate. In 2015, the Government of Togo partnered with an agricultural research center to test new varieties of seeds and select the most promising ones.
World Bank Support for the Development of Morocco’s Blue Economy (World Bank)
The World Bank has approved a US$350 million loan to support the Government of Morocco in the launching of its Blue Economy program. The program aims to improve job creation and economic growth, as well as the sustainability and resilience of natural resources and food security, which has increased in importance given the impacts of the war in Ukraine. Building on past World Bank engagement in coastal development in Morocco, the Blue Economy Program for Results (PforR) aims to develop institutional frameworks, improve the integrated management of natural resources, and strengthen selected sectors for a climate-resilient blue economy in targeted areas.
“Bordered by the Mediterranean Sea and the Atlantic Ocean, Morocco’s potential for developing its Blue Economy is strong. Its coastal areas already contribute to more than 50% of GDP and jobs in the country, and there is more untapped potential in both existing and emerging blue sectors like aquaculture, seaweed farming, and renewable marine energy. As laid out in the diagnosis of the New Development Model, Morocco has the opportunity to develop coastal clusters that attract investments and creates jobs while ensuring sustainability,” said Jesko Hentschel, World Bank Maghreb Country Director.
African trade news
Kagame in Davos for World Economic Forum (The New Times)
President Paul Kagame has arrived in the Swiss town of Davos where he joins over 50 Heads of State for the World Economic Forum annual meeting. Convening over 2000 leaders and experts after two years without in-person events, the forum is centred around the theme “History at a Turning point: Government Policies and Business Strategies,” which comes against the backdrop of the Covid-19 pandemic. According to a statement, President Kagame will co-chair a session “Forum of Friends of the African Continental Free Trade Area” to discuss the progress made in the implementation of the AfCFTA. The head of state will also speak on preparing for the next pandemic alongside Bill Gates and leaders in the field of health.
Boosting Intra-African Agricultural Trade through Harmonisation of Seed Regulatory Frameworks (COMESA)
With the launch of the African Continental Free Trade Agreement, Member States stand to benefit from wider market access for seed trade. This will lead to competitiveness of the seed industry and pricing given the ongoing efforts by the African Union Commission and partner organizations in seed policy and regulatory harmonization on the continent. Sharing the success story on the status of harmonization efforts in the Common Market for Eastern and Southern Africa (COMESA) region, the interim Chief Executive Officer of the Alliance for Commodity Trade in Eastern and Southern Africa (ACTESA), Dr John Mukuka, stated that achieving regional seed security, would essentially require Member States to leverage on harmonised regional seed regulatory frameworks that offer opportunity to support and facilitate exchange of germplasm and/or varieties among countries, audit one another’s seed production systems including reduction in costs of varietal certification.
Countries with less developed seed systems will access improved varieties from neighbouring countries with better supply system while those States with well-developed seed system will benefit from simplified processes and wider markets. This implies that countries with high comparative advantage in the production of certain seed crops will be encouraged to produce surplus.
He observed that a functioning seed system is one with seed policy instruments, functional institutions to regulate seed certification, variety release processes, production and distribution channels. He further noted that there were more similarities than differences in the seed trade harmonization efforts among Regional Economic Communities (RECs) in Africa implying that they have a lot in common, and hence it is time to consider continental harmonization in view of the African Continental Free Trade Area (AfCFTA).
How governments across Africa defend troubling seeds regulations (Down to Earth Magazine)
Governments in African countries justify rush to formalise the seed sector citing acute food scarcity in the continent
Africa is grossly food-insecure and a net importer of food. According to the United Nations, the continent will have the world’s highest number of people living in hunger — 433 million — by 2030. It spent $35 billion on importing food in 2020 and the amount is estimated to increase to $100 billion by 2030 as the gap between demand and local production widens. How the agriculture sector performs has ramifications for the economy. The sector accounts for 32 per cent of Africa’s gross domestic product and employs more than 60 per cent of the continent’s labour force, largely in the poorest countries. Nearly three-fourths of sub-Saharan Africa’s (SSA) population is small and subsistence farmers, but it accounts for over 75 per cent of the agricultural output. According to The Seed Sector in Africa: Status Report and Ten-year Action Plan (2020-2030), a report published by the African Union Commission (AUC) in 2021 to guide the continent’s agricultural policy: “At the farm level, yields must increase if surpluses available for trade are to be realized.
The AUC assessed that increasing area under agriculture was not sustainable. So, it suggested: Key to increasing productivity is adoption of high-yielding varieties, fertilizers, and other inputs. Of all the inputs, high-quality seed is perhaps the most important, as it determines the upper limit of what farmers can achieve. Improving access to new high-yielding and climate-smart hybrid varieties requires increasing seed production and expanding distribution through increased competition in the seed system.
Africa Must Digitalize to Achieve 4th Industrial Revolution (Walta Information Centre)
Africa must develop high computing capacity to achieve the 4th industrial revolution, said Paul Tiyambe Zeleza, Associate Provost and Professor, Case Western Reserve University, Cleveland Ohio. Prof Zeleza was the key speaker at this year’s ECA Annual Adebayo Adedeji Lecture session at the 54th Africa’s Conference of Ministers of Finance, Economic Planning and Development (CoM2022) in Dakar, Senegal. The 4th industrial revolution, he noted, is an agenda for everyone as it will transform all sectors from education to technology and health.
“Africa was marginalized in the previous three industrial revolutions and the continent should ensure it’s not left behind in the fourth industrial revolution,” said Prof Zeleza. “Africa must promote digitalization, rethink capital expenditure, and develop holistic online curriculum system to achieve its economic, digital transformation. We must walk the talk on constructing integrated, inclusive, innovative and sustainable developmental institutions,” said Prof Zeleza.
The fundamental structures of African economies, he said, have remained the same since colonial times. In fact, dependency on primary commodity production and export has increased.
COMESA and UNCTAD Train Customs Experts in ASYCUDAWorld (COMESA)
Twenty-one customs experts from the COMESA Secretariat and eight Member States have completed a three-months training on the Automated System for Customs Data (ASYCUDA)World Functional and Technical Courses. ASYCUDA is supplied by the United Nations Conference on Trade and Development (UNCTAD). Over the years, the system has evolved through various versions and the current one is known as ASYCUDAWorld. Through this system, UNCTAD developed advanced software applications for Customs Administration and the trading community to comply with international standards when fulfilling import, export and transit related procedures.
As of 2022, thirteen COMESA Member States namely Burundi, Comoros, Djibouti, DRC, Eritrea, Eswatini, Madagascar, Malawi, Rwanda, Seychelles, Sudan, Uganda, Zambia and Zimbabwe use different versions of ASYCUDAWorld and one Member State Eritrea is using ASYCUDA++ to facilitate merchandise trade as well as providing national and regional trade statistics.
In consideration of this provision and the regional action plan towards the Digital Free Trade Area, COMESA Secretariat and UNCTAD signed a Co-delegation Agreement in 2018 under the European Development Fund (EDF 11) Trade Facilitation Programme to develop and implement a Customs Automation Regional Support Centre (CARSC) and Trade Information Portal (TIP) at the Secretariat. This training on ASYCUDAWorld Functional and Technical Courses is among activities on the development of the CARSC.
Northern Corridor Complements LAPSSET - Ambassador Meles (Walta Information Centre)
A delegation headed by Ambassador Extraordinary and Plenipotentiary of the Federal Democratic Republic of Ethiopia to Kenya, Meles Alem, and representatives of the Governments of Kenya and South Sudan with regards to the Lamu Port-South Sudan-Ethiopia- Transport (LAPSSET) Corridor Project paid a scoping mission to the Northern Corridor Transit and Transport Coordination Authority (NCTTCA) Permanent Secretariat, Kenya Port Authority (KPA) and the Northern Corridor Infrastructure including SGR and the Mariakani Weighbridge in the Coastal Kenyan City of Mombasa. As development partners in the LAPSSET Corridor Project, representatives of the United Nations Economic Commission for Africa (UNECA) and New Partnership for Africa (NEPAD) Kenya were also part of the scoping mission.
Ambassador Meles Alem underscored the fact that the Northern Corridor that is adjacent to LAPSSET complements the latter while providing Southern Ethiopia with more port options in the region.
Ambassador Meles noted that KPA needs to promote the Port of Mombasa in the Ethiopian market as it is a landlocked yet most populous country in the region. He said, Ethiopia and Kenya have jointly inaugurated the Moyale One-Stop-Border-Post, the Moyale-Hawassa Highway, and the first three berths of Lamu port, which are part and parcel of LAPSSET and KPA needs to further expedite the untapped Ethiopian market.
Burundi Reaffims Support to COMESA (COMESA)
President Evariste Ndaishimiye of Burundi has reaffirmed his government’s commitment and support to COMESA’s regional integration agenda and called for deeper trade within the 21 Member States. He has urged the region to focus on implementing programmes that benefit the people by encouraging the growth of businesses and interaction. He said this during a meeting with a delegation from COMESA Secretariat led by Secretary General (SG) Chileshe Mpundu Kapwepwe in Bujumbura.
“Our government believes in the ideals of COMESA and we are determined to continue working to deepen trade and integration with the other Member States,” said President Ndaishimiya during the meeting held on 18 May 2022 at the Presidential Palace.
African Coffee Summit to be held in Nairobi (The Standard)
Kenya is set to host the first G25 African Coffee Summit (ACS) in Nairobi starting tomorrow. The conference dubbed Sustainable Development and Economic Growth in the African Coffee Sector will bring together Heads of State from 25 coffee-producing countries who will re-evaluate the overall performance of the sub-sector. Agriculture PS Francis Owino said the summit will provide a platform for the coffee-growing countries to address the challenges they face. “Coffee has contributed immensely to national GDPs and the socio-economic development in rural infrastructure, education, health, employment, and poverty eradication,” Dr Owino said. He added: “It is a major source of raw materials to the agro-processing industries and contributes to narrowing trade imbalances between Africa and her trading partners.”
AFI summit: Evaluating Africa’s aviation safety, security performance (New Telegraph)
Africa’s aviation safety and security recently came under the searchlight of the global aviation regulatory body, the International Civil Aviation Organisation (ICAO). The continent, despite doing so much, still has a lot of gaps to close, just as the liberalisation of air transport in Africa, otherwise known as Single Africa Air Transport Market (SAATM), came under focus at the summit, writes WOLE SHADARE
Africa’s aviation industry took the centrestage in Abuja, last week, as the International Civil Aviation Organisation (ICAO), Directors- General of Civil Aviation in Africa, the African Civil Aviation Commission (AFCAC), the representative of the Singaporean Government, among other groups of aviation intelligentsia, gathered to discuss the myriad of problems confronting aviation safety, security and the liberalisation of air transport in the continent. ICAO Secretary-General, Juan Carlos Salazar, while addressing Africa’s aviation leaders last week in his opening of the 2022 AFI Aviation Week, highlighted the tremendous potential future for aviation in Africa that could be achieved through the realisation of regional commitments and underscored the critical role aviation should play in states’ pandemic recovery planning.
The secretary-general highlighted that air transport growth rates in Africa were among the fastest in the world prior to COVID-19, noting, however, that “we must also recognise together that recent results could have been much more robust if not for persisting regulatory barriers, financial constraints, and the slow pace of air transport liberalisation here.”
The Director-General of Nigerian Civil Aviation Authority (NCAA), Capt. Musa Nuhu, said the AFI Aviation Week was the biggest regional conference that ICAO has for the African region and the Indian Ocean, stressing that it comprises a lot of regional plans for Africa.
One of the key components of the AU Agenda is SAATM, which is a flagship project of the African Union Agenda 2063, an initiative of the African Union to create a single unified air transport market in Africa to advance the liberalisation of civil aviation in Africa and act as an impetus to the continent’s economic integration agenda. SAATM will ensure aviation plays a major role in connecting Africa, promoting its social, economic, and political integration, and boosting intra-Africa trade and tourism as a result. The International Air Transport Association (IATA) fully supports this initiative, which will open up Africa’s skies and promote the value of aviation throughout the continent. Openair arrangements boost traffic, drive economies and create jobs.
Africa’s leading financial institution will avert looming food crisis (AfDB)
The African Development Bank Group’s Board of Directors has approved a $1.5 billion Emergency Food Production Facility to help tackle the global food crisis sparked by the Russian-Ukraine conflict. The funds will help 20 million African farmers produce an extra 38 million metric tons of food to address growing fears of starvation and food insecurity on the continent.
Overcoming Africa’s challenges includes building back from Covid-19. Early in the pandemic, the Bank provided a crisis response facility of up to $10 billion to African countries to help overcome its social and economic impacts. It also launched a $3 billion Covid-19 social bond on the global capital markets, at the time, the highest ever US dollar denominated social bond. According to the Bank’s president, Dr. Akinwumi Adesina, this helped provide social protection to about 30 million vulnerable people.
Vulnerable Africa faces heavy climate finance shortfall (The New Times)
Africa needs about $1.6 trillion to address climate change annually from 2020 to 2030, however it only gets three per cent of the total global climate finance, according to Akinwumi A. Adesina, President of African Development Bank Group. He said while addressing the media on May 23 in Accra, Ghana, to kick off the Bank’s Annual Meetings that will go through until May 27.
Under a theme dubbed “Achieving Climate Resilience and a Just Energy Transition for Africa” central bankers from Africa will convene to share climate change and energy transition challenges that their countries face and showcase policy responses to tackle these challenges. Africa, which accounts for just four per cent of the global greenhouse gas emissions, is short-changed by climate finance. “Africa is not getting enough resources to tackle climate change. Climate financing mobilised globally falls short of Africa’s needs by $100-$127 billion per year since 2020-2030,” noted Adesina.
According to him, data has it that Africa loses about $7-15 billion due to climate change annually and it is expected to rise to $50 billion a year by 2040.
African Economy Development Policy In Practice – Lessons From South Korea’s Development Experience (AfDB)
The developmental state model and the experiences of South Korea present at least four propositions for Africa’s aspiring late industrializers. First, although successful cases of developmental states are concentrated in East Asia, their development process was by no means coincidental. It was demonstrably autonomous, driven by the need for rapid development, and can been replicated in other regions. Second, the industrialization and economic transformation that the developmental state requires can be gained within a relatively short time-span if policies are coherent and the institutions implementing them rigorous enough. Countries such as South Korea, Singapore, and Taiwan were literally catapulted from abject poverty to relative affluence in less than half a century by focused and determined governments. Third, the developmental state is the product of a social compact for development, which can only be assembled in the presence of long-term commitment. It requires institutional discipline and effort in research and development, supervision and coordination, and implementation, monitoring, and follow-up. It demands unrelenting support from the political leadership as well as the private sector. Fourth, while the developmental state must be grounded in realism, South Korea’s success partly lay in the ability of its leaders to stake out an ambitious development agenda and dare their country to “dream big”.
How currency sanctions on Russia could disrupt trade with Africa (Brookings Institution)
Financial sanctions tend to hurt both the sanctioned and the sanctioner, but they also threaten to hurt countries that are financially interlinked with the sanctioned country. Recent sanctions levied on Russia by the United States and the European Union in response to Russia’s invasion of Ukraine are disrupting global trade and financial networks across the world, including in Africa. The sanctions prevent U.S. and eurozone banks, their foreign affiliates, and Russian banks based in the U.S. and eurozone countries from facilitating dollar and euro transactions on behalf of Russian entities. The problem for Africa is that roughly 95 percent of all trade is invoiced in these two sanctioned currencies alone and that a vast majority of Africa’s $14 billion trade with Russia is likely denominated in these two currencies.
This paper uses a recently released dataset that measures the currency of trade invoicing to estimate the share of African trade that will be disrupted—that is, current financing pathways rendered inexecutable—due to the sanctions levied by the U.S. and eurozone countries on Russia (we call these effects “disruptions,” rather than losses, because they have not yet been realized, and it is uncertain how trade partners in Russia and Africa will respond to reduced financing options). We find that currency sanctions alone have the potential to disrupt 1.8 percent of all African trade and, for some countries, upwards of 5 percent of trade revenue.
VDMA: “Free trade can bring Africa and EU together” (The NewsMarket)
Many African countries are modernizing their economies at a rapid pace, particularly to meet the challenges of climate change. “European machine technology can play an important role in moving African countries forward economically. The expansion of renewable energies is a good example of this,” says Ulrich Ackermann, head of the foreign trade department at VDMA, on the occasion of German Chancellor Olaf Scholz’s trip to Senegal, Niger and South Africa. It is precisely for the major challenges such as adapting to climate change, the sustainable use of water and marine resources, the introduction of circular economy systems, and the reduction of environmental pollution that European machinery and plant manufacturers provide the technical solutions. In this way, they can contribute to the sustainable further development of the African industrial structure as well as to the creation of local jobs - also with suitable skilled labor development.
Although the mostly medium-sized mechanical engineering companies from Germany and Europe have recognized Africa’s growing market potential, many are still hesitant about entering the market. Exports to Africa so far account for only a good 2 percent of all German exports in the mechanical and plant engineering sector, with by far the most shipments going to South Africa and Egypt. Investments on the African continent, which require an established business, are only available in manageable quantities.
As a result of the global Corona pandemic and the looming conflicts between the U.S. and China, many companies in the machinery and plant engineering sector will now try to position themselves more resiliently and review their supply chains to do so. “This can bring the two neighboring continents of Europe and Africa closer together. Africa wants to advance free trade and thus has similar goals to the EU,” emphasizes Ackermann.
Global economy news
DG Okonjo-Iweala underlines need to help African small businesses access trade finance (WTO)
DG Okonjo-Iweala highlighted Cote d’Ivoire’s proposals to the WTO on improving access to trade finance for small businesses in Africa and underlined the acute financial constraint, notably the lack of trade finance, that sub-Saharan Africa is facing.
Global surveys show that, while around 30% of international trade finance goes to SMEs, banks reject some 40% of applications from such companies. This rejection rate is higher than for any other type of companies. According to the African Development Bank, the rejection rate for letters of credit applications increased by 30% during the pandemic.” She stressed that the pandemic had accentuated trade financing gaps in Africa, which, prior to the pandemic totalled about USD 80 billion per year, representing about 20% of the African trade finance market.
DG Okonjo-Iweala said the lack of availability of trade finance or its availability at higher costs than the world market are major obstacles to the integration of African countries into world trade.
She concluded: “For countries to be successful in international markets, their logistics, transport, border-crossing and trade-finance costs must be competitive. Controlling these costs requires expertise and training, which eventually reduces transaction costs.” The workshop will contribute to achieving this goal, she added.
Goods barometer remains flat as Ukraine conflict, COVID-19 weigh on trade (WTO)
The latest outlook scales back the earlier optimism in the barometer from February, which suggested that trade might have been approaching a turning point, with stronger growth expected the near future. In April, the WTO forecasted 3.0% growth in the volume of world merchandise trade in 2022, down from the 4.7% growth predicted as of last October. The current barometer reading is broadly consistent with the April projection, but forecasts are less certain at the moment and should be interpreted with care.
Commerce Minister calls for cancellation of required documents for export from LDCs (Khmer Times)
Required documents for export from Least Developed Countries (LDCs) such as proof of non-manipulation or Certificate of Origin which increase the cost for export should be cancelled and replaced with self-certification.
The suggestion was made by Pan Sorasak, Minister of Commerce of Cambodia, while attending a discussion on “Solving trade barriers for recovery” as part of the World Economic Forum Annual Meeting 2022 in Davos-Klosters, Switzerland on May 23. Minister Sorasak laid stress on the significance and necessity to remove and reduce trade barriers through trade facilitation in the country, the region and the world, an important way for rapid economic recovery.
The World Economic Forum’s Community of Chief Economists expects lower economic activity, higher inflation, lower real wages and greater food insecurity globally in 2022, pointing to the devastating human consequences of the fragmentation of the global economy. Reversing previous expectations for recovery, the majority of respondents to the latest survey expect only a moderate economic outlook in the United States, China, Latin America, South Asia and Pacific, East Asia, sub-Saharan Africa and the Middle East and North Africa in 2022. In Europe, the majority expect the economic outlook to be weak.
“We are at the cusp of a vicious cycle that could impact societies for years. The pandemic and war in Ukraine have fragmented the global economy and created far-reaching consequences that risk wiping out the gains of the last 30 years. Leaders face difficult choices and trade-offs domestically when it comes to debt, inflation and investment. Yet business and government leaders must also recognise the absolute necessity of global cooperation to prevent economic misery and hunger for millions around the world. The World Economic Forum’s Annual Meeting this week will provide a starting point for such collaboration”, says Saadia Zahidi, Managing Director at the World Economic Forum.
With wheat prices expected to increase by over 40% this year and prices for vegetable oils, cereals and meat at all-time highs, the war in Ukraine is exacerbating global hunger and a cost-of-living crisis. Over the next three years, chief economists expect food insecurity to be most severe in sub-Saharan Africa and in the Middle East and North Africa. At the current trajectory, the world is on track for the worst food crisis in recent history, compounded by the additional pressure of high energy prices.
As supply chains enter their third year of disruption, governments and business are rethinking their approach to exposure, self-sufficiency and security across their supply chains. Chief economists consider it likely or highly likely that multinational companies will both localize and diversify their supply chains in the next three years, realigning them along geopolitical fault lines.
The November 2021 edition of the Chief Economists Outlook identified “deglobalization” as an emerging trend driven by the impact of the pandemic. The war in Ukraine and its geopolitical and economic fallout is accelerating these trends, with declining physical integration and increasing friction in the virtual space. A majority of the chief economists polled for May’s Outlook expect higher fragmentation in the markets for goods, technology and labour in the next three years, while most expect services to remain stable or be more globalized.
What’s next for economic globalization? (WEF)
There is little debate that globalization has created significant economic opportunities and lifted millions out of poverty. But its focus on growth and competitiveness has also been criticized as a source of inequality and economic disruption. Add to this the fundamental economic transformation the world has undergone since the pandemic began, the ongoing climate crisis and renewed geopolitical turbulence, and it’s clear that globalization is at a crossroads. A new white paper from the World Economic Forum’s Centre for the New Economy and Society takes a look at what our global economic future might look like. Four Futures for Economic Globalization: Scenarios and Their Implications puts forward four possible trajectories for the evolution of globalization by 2027. It considers how globalization may evolve as economic powers choose between multilateral integration and fragmentation, both at a political level and in their technology policies.
Disruption to world shipping likely to worsen warns global insurer (IOL)
THE MARITIME industry has warned that the war in Ukraine since March is likely to exacerbate ongoing supply chain disruption, port congestion and crew crises caused by the Covid-19 pandemic. Allianz Global Corporate and Specialty (AGCS) yesterday said the war had already caused widespread disruption to global shipping, with the loss of life and vessels in the Black Sea, disruption to trade with Russia and Ukraine, and the growing burden of sanctions. “Longer term, sanctions and a reduction in trade with Russia could result in the redrawing of some supply chains and trade routes, but this all takes time and comes at a cost.”
We need to grow collaboration on international investment (WEF)
When investing is sustainable from an economic, social, environmental and governance perspective, it can provide not only capital but also drive job creation, alleviate poverty, encourage technology transfer, and upgrade industries. It can increase peace and stability and advance climate and environmental goals, addressing some of the greatest challenges the world faces today. However, despite this potential, many of the frameworks that guide investment were designed in another era and have not been updated to reflect today’s realities and priorities. The challenge is to develop a coherent vision for international investment, under which different investment reform processes and initiatives can be aligned and mutually supportive. At the same time, capital earmarked for sustainable investment has been growing dramatically, even during COVID-19, reaching more than $35 trillion. Yet well over 95% of this pool remains in developed economies. The challenge is therefore not the availability of capital, but the flow of this capital to where it is most needed: productive investments in developing economies.
We are excited to announce the launch of the World Investment for Development Alliance (WIDA) at the World Economic Forum’s Annual Meeting 2022. By bringing all relevant stakeholders onto one platform, WIDA can enable conversations and coordination to identify opportunities for collaboration.
Russia’s economy is ‘imploding’ as exports to the sanctioned country plummet, trade experts say (Business Insider Africa)
Russia’s economy is collapsing as exports to the sanctioned country plummet in the face of President Vladimir Putin’s ongoing, unprovoked war in Ukraine, trade experts suggest. The “economy is imploding. We forecast a GDP collapse of -30% by end-2022,” said Robin Brooks, chief economist at the Institute of International Finance trade group, in a Sunday tweet. Brooks added that according to data compiled with help from IIF researcher Jonathan Pingle, exports from 20 countries to Russia were down 50% in April compared to the same time a year prior.
Monthly exports from Russia to other countries, however, were up 64% in April compared to the same time a year prior, Brooks said on Monday, as oil and gas sales become a bigger part of Moscow’s revenue.
Globalization for food security and ending world hunger (WEF)
The two years of unprecedented pandemic-produced shocks that stressed supply chains and saw the FAO Food Price Index for staples like vegetable oils and cereals increase by 182% and 68%, respectively, have been immediately followed by Russia’s invasion of Ukraine, exacerbating an already dire food security scenario. When farmers suddenly become soldiers in the world’s breadbasket – where the two countries, combined, produce more than a quarter of the world’s barley and wheat – it naturally sprouts concerns about the risks of having our food supply concentrated in a handful of countries. Many are asking… If a war in Ukraine is causing food insecurity in Egypt and Nigeria, is this really a system we want?
The Russia Ukraine war has impacted food security in countries like Egypt and Nigeria
Some have suggested that a major shift to “on-shore” food production is the logical solution. We have even seen some countries impose export bans on certain essential goods. But these solutions ignore the critical role that open markets play in preventing food shortages. Indeed, protectionism will only increase commodity prices across the board and contribute to a global economic downturn.
The era of trade liberalization not only produced better economic outcomes, but also reduced hunger and famine, and enhanced food security – all during a period of rapid population increase.
However, the current crisis has demonstrated that we may have over-optimized for efficiency in some cases by relying on concentrated centers of food production.
To strengthen resilience, we need to diversify our supply chains, especially for critical goods such as food. This will require us to improve access to services across borders that are essential to the production and transportation of agricultural products.
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AfCFTA holds opportunities for South African industry (Engineering News)
With progress being made on negotiations for the implementation of the African Continental Free Trade Area (AfCFTA), South Africa’s steel industry could capitalise on opportunities emanating from AfCFTA agreement, once it is implemented. Tralac Trade Law Centre executive director Trudi Hartzenberg told delegates attending the Mainstreaming the Steel Master Plan Conference on May 20 that 43 African States that have signed the AfCFTA agreement have now ratified it. She clarified, however, that this did not mean that trade could start under the agreement immediately, given that there were some outstanding issues that needed to be resolved first.
Trade would continue within the continent under agreements that were already in place, and once AfCTA becomes operational, would run parallel to these. However, once AfCFTA was fully implemented, this would change the dynamics in terms of how countries like South Africa would trade with other important economies on the continent, such as Egypt and Nigeria, Hartzenberg outlined.
She also noted that there would be distinct benefits for South African producers. Hartzenberg outlined that there was considerable scope to improve the country’s steel export performance on the continent.
For Steel Master Plan to work all parties must come to the table, says Patel (IOL)
IF the government does not understand the spirit of the Steel Master Plan, it will not succeed. For it to succeed, there are micro-actions that need to be addressed, according to Minister of Trade and Industry Ebrahim Patel. He said this week that the business environment - including the challenges of energy and transport logistics, stimulating the economy with an infrastructure roll-out, and the broader reigniting of private investment in mining and manufacturing property - needed to be addressed.
Scrap metal draft policy on the way by late July, says Patel (News24)
Trade, Industry and Competition Minister Ebrahim Patel told Parliament that South Africa could expect a draft policy to address the illegal trade of copper cable and scrap metal by the end of July. Patel tabled a R10.9 billion budget vote for the Department of Trade, Industry and Competition in Parliament on Friday. The government has been grappling with the illegal trade of scrap metal, which has largely been fed by the theft from the country’s freight and passenger rail network. Earlier this month, Public Enterprises Minister Pravin Gordhan called for a temporary ban on the sale of scrap metal in the country to eliminate the external market for infrastructure that has been vandalised and stolen.
On Friday, Patel told Parliament that he and Gordhan were working together to build support structures for industries to address challenges, including energy challenges and stopping scrap metal syndicates. He said a scrap metal policy was in the works and would be drafted soon.
“We are building an enabling environment for industrialisation [that] requires securing our key network infrastructure, such as energy and logistics, and protecting our electrical grid and rail network from the continued threat of scrap metal syndicates.
“By the end of July, we will have developed and tabled a draft policy on scrap metal, which will introduce a blend of domestic and export measures to address illegal trade in copper cable and scrap metal,” said Patel.
Namibia Intra Africa Trade Summit kicks off today (New Era)
Speakers and exhibitors from various African countries will convene for the next three days in Swakopmund for the inaugural Discover Namibia Intra Africa Trade Expo and Africa Summit that will start today at the Swakopmund Hotel and Entertainment Hotel. The three-day Trade Expo & Business Summit is the brainchild of the Africa Economic Leadership Council (AELC), a pan African business organisation co-founded by Swakopmund local authority councillor Heinrich Hafeni and Percy Morapedi Koji from South Africa.
“The Summit aims to bring together political, business and economic leadership to discuss how best intra-African trade and business can be accelerated under the Africa Free Trade Agreement (AfCTA). The AfCFTA came into operation in January 2021 and promotes the formation of a single market for the free movement of goods across 54 African countries,” Hafeni explained.
The African continent has pronounced itself and is open for business. However, it is up to us entrepreneurs to take it further and create networks. We want to unpack opportunities that these networks create and tell Namibians and all other African entrepreneurs that there are opportunities outside their relevant countries,” Hafeni said.
Case for basic commodities imports (The Herald)
Following the announcement of import duty suspension on some basic commodities by the Permanent Secretary in the Ministry of Finance and Economic Development, Mr George Guvamatanga on May 16, there was a loud outcry from the expected quarters, who cited fears of the move affecting industry. The reaction demonstrated that those who cried the most did not have a full appreciation of the challenges that Zimbabwe is facing and were selfish or out rightly dishonest with the nation on the matter. The key basic products which resulted in the suspension of import duty were salt, cooking oil, rice, flour, sugar, margarine, mealie-meal, milk powder, infant formula, tea, petroleum jelly, toothpaste, bath soap, laundry soap and washing powder. People use these goods in their day-to-day lives. Among those organisations which were not happy with the move was Buy Zimbabwe, whose general manager, Alois Burutsa commented that the “development is likely to reverse the industrialisation gains that had been made by local industry in the supply of basic commodities.”
Other stakeholders questioned the rationale of Government opening the floodgates for imports at a time that products manufactured locally occupied 75 percent of the available retail space. It is only last week that the Confederation of Zimbabwe Industries (CZI) announced that last year the country’s capacity utilisation rose to 56,25 percent.
Kenya set to host 25 African coffee producing countries (Pulse Live Kenya)
The summit themed “Sustainable Development and Economic Growth in the African Coffee Sector,” will involve attendees discussing ways on how to boost domestic output and value-addition of the respective commodity. “The main objectives of the summit include marshalling consensus on a declaration to include coffee as an anchor commodity in the African Union in harmony with the AU Africa Agenda 2063,” revealed Inter-African Coffee Organisation (IACO). The summit which will be graced by President Uhuru Kenyatta will also see the attendees discuss on how to increase value addition and boosting domestic consumption and expanding coffee trading regionally under the African Continental Free Trade Area (AfCFTA) framework.
Kenya has been a member of the Inter-African Coffee Organization (IACO) since 1960 when IACO membership was 11 States, to 25 States today. According to the Kenya National Bureau of Statistics (KNBS) earned Sh24.2 billion (213million U.S. dollars) in the period January to November 2021, with the value surpassing the entire 2020 earnings that stood at 196million dollars.
Horticulture earnings fall Sh20 billion in first quarter (Business Daily)
Horticulture earnings dropped by Sh20 billion in the first quarter of this year on the back of low-quality avocados and a sharp decline in returns from flowers. The Kenya National Bureau of Statistics (KNBS) data indicates the export value of the produce declined to Sh26 billion in the period under review from Sh46 billion in the corresponding time a year earlier. Head of Horticulture Directorate Benjamin Tito said a good number of avocados that were exported were not mature enough, leading to low value and huge rejection of the produce in the world market, which would have lifted earnings.
However, Mr Tito said, export earnings for horticulture will pick from April going forward after the ban on harvesting of avocado was lifted in March. Flowers normally make the largest share of the total horticulture export earnings as they are high-value crops.
Cotton production hit as supplier of GM seeds pulls out (Business Daily)
An Indian firm contracted to supply genetically modified (GM) cotton seed to Kenyan farmers has stopped distribution of the planting material, dealing a big blow to President Uhuru Kenyatta’s manufacturing agenda. Agriculture Cabinet secretary Peter Munya said the Indian-based conglomerate Mahyco – the sole maker and distributor of the seed worldwide, has had running problems with supplying the product to local farmers. Kenya had in 2018 approved the cultivation of GMO cotton to boost production under the open field cultivation while commercialisation started in 2020 as the government sought to increase volumes of the crop to spur manufacturing, which is one of the items on the Big Four agenda.
“The challenge that we are having now is seed multiplication, a company that was given that role had some challenges but I think that is being addressed by the authorities,” said Mr Mugiira. Cotton production has been falling in the country since the 1980s with Kenya relying on imports to bridge the deficit.
High fuel, commodity prices dampen Museveni’s first year in his sixth term (The East African)
The high cost of living, a widening budget deficit, corruption and growth uncertainties continue to blot Ugandan President Yoweri Museveni’s sixth term in office. The president, expected to address the nation this weekend after the end of the first year of his current term, has been facing calls from businesses and the public to tame the escalating cost of commodities, especially fuel, whose retail price has risen over 70 percent in the past year.
Although the Bank of Uganda says the economy is recovering from the pandemic downturn, domestic growth weakened in March 2022 due to the rising prices of food and fuel. Juliet Najjinda, manager of tax services at PricewaterhouseCoopers Uganda, said it is time the government introduced a fuel subsidy to reduce pump prices, as the manufacturing sector is feeling the heat.
“The outlook of the country seems to indicate there are two countries in one; the greater North and South,” said Mr Kivumbi, the shadow minister of finance and economic planning. “If not addressed, it poses a threat to the security of and posterity of the country.”
Willis Bashasha, director of manifesto implementation in the Office of the President, said that they are facing challenges in carrying out their policies.
Kinshasa enters shipping business, set to rock EA boats (The East African)
The Democratic Republic of Congo is entering shipping business with eyes on East Africa’s two biggest ports in Kenya and Tanzania, signalling further intent by the bloc’s newest member to ease its importation channels. This week, officials from Kinshasa announced they had obtained yard spaces in Mombasa and Dar es Salaam to roll out offices for DR Congo’s new shipping line: The Lignes Maritimes Congolaises (LMC) that will start operations from June. The decision that came just about a month after the DR Congo was formally admitted into the East African Community reflects the country’s desire to tap into the benefits of being in the trade bloc, where it is now cheaper and easier to import as tariffs are headed for reduction.
The Kenya Ports Authority (KPA) is banking on the admission of the DR Congo to the East African Community to increase its business market in the region. LMC, the state-owned shipping line mandated with maritime transport and the operation of marine vessels in DRC, is targeting to channel more import-export cargo through the Port of Mombasa, as well as raise volumes in Dar.
“After a discussion on operational and logistics issues with KPA container terminal principal operations officer Michael Bokole and his team, we have agreed to start our operations from Mombasa starting next month. ‘‘This will help in creating more jobs and business opportunities not only for DRC but to Kenya,” said Dr Mulunda.
Opening address to EU-Zambia Economic Forum, Lusaka (European Commission)
Our Economic Partnership Agreement is a great tool. The Agreement removes trade barriers, encouraging healthy competition and lower prices for consumers. It can benefit both Zambia and Europe by helping our two regions to sustainably invest in each other and trade with each other, for improved food security and sustainability.
Another significant step forward in this direction is the African Continental Free Trade Agreement, which we fully support.
The Free Trade Agreement addresses a fundamental lesson we in Europe have learned through our historical experience: removing (some) tariffs alone does not guarantee the improved flow of trade. The trading partners must also harmonise their regulatory environment, allowing businesses to invest and trade across borders with a sense of legal certainty.
I am convinced that we can create a continent-to-continent free trade area between the European Union and Africa in the long-term, opening new perspectives for competitive businesses and healthy economies in both continents.
Dar port reaps from rising political heat ahead of Kenya polls (The East African)
The heat from Kenya’s campaigns ahead of the August 9 General Election is affecting the flow of goods on the Northern Corridor, with Tanzania benefiting from the windfall as more cargo destined for the Great Lakes region is diverted to the Dar es Salaam port.
With memories of the 2007/08 post-election violence that disrupted transport on the corridor still fresh — and a $63 million compensation award ordered by a Nairobi court still pending — many importers, especially Ugandans and Rwandans, are opting for the Central Corridor. Due to this cargo flight, transit volumes through the Dar es Salaam port to the Central Corridor have recently recorded significant growth as Mombasa registers plateaued or declining volumes of goods on the northern route. According to the latest Mombasa Port Corridor Community Charter report, transit volumes through the Dar es Salaam port grew at 21 percent in 2021 while those through the port of Mombasa declined 6.2 percent in the same period.
The decline is blamed on a move by importers in Uganda, Kenya’s largest transit market in the region, to divert more cargo to Dar es Salaam.
Strengthening Nigeria’s Border Policing, Mgt Mechanisms (Leadership News)
The federal government, in April, 2022, approved the reopening of Idiroko, Jibia, Kamba and Ikom land borders. This is coming three years after the government shut down the borders due to the incessant smuggling of arms and different contraband goods. Meanwhile, it has been noted that border closure control policy has not yielded the desired result. While the primary aim of the closures was to curtail food imports into Nigeria, they blocked other vital imports and exports from and to Benin, Niger, and Cameroon. Communities along the border and small and medium-sized businesses that trade over the boundaries lost their livelihoods overnight and saw their operations hampered by bureaucracy.
Stakeholders commended the reopening of the border, while calling for border policing and management mechanisms. To them, border management is a function of regime types in place for the purpose of maintaining border administration. It includes routine administration to be undertaken at the border and in border zones. Border management generally rests on governmental surveillance agencies like the immigration, customs and police forces to ensure a lawful movement of human and economic resources in the national interest.
Many small businesses depend on cross border trade for a living. Many manufacturers also leverage the ECOWAS Trade Liberalisation Scheme (ETLS) to boost their business. Many also source their raw materials from countries in the sub region.
“It is equally important to facilitate the competitiveness of products made in Nigeria. Huge disparities in operating and production costs relative to conditions in other countries of the sub region pose huge smuggling risks. We need to provide more incentives to Nigerian industries to achieve better competitiveness status,” said CEO of Centre for the Promotion of Private Enterprise (CPPE), Dr Muda Yusuf.
Equatorial Guinea: Staff Concluding Statement of the 2022 Article IV Mission (IMF)
The COVID-19 pandemic in 2020, and Bata explosions in 2021, struck Equatorial Guinea at a time when its economic vulnerabilities had already been aggravated by a prolonged period of depressed hydrocarbon prices, and seven consecutive years of decline in real GDP. As a result, the shocks further adversely impacted economic activity, the banking system, fiscal revenue, and social outcomes. While non-hydrocarbon GDP is estimated to have increased by 1.3 percent in 2021 due to a deceleration in COVID-19 cases and easing of pandemic containment measures, real GDP is estimated to have declined by 3.5 percent.
Despite recent negative shocks, the near-term outlook has improved considerably. Real GDP is projected to grow by about 6 percent in 2022 due to base effects from the lower-than-expected gas production in 2021, and the start of Bata reconstruction. The recent relaxation of pandemic containment measures and higher international oil prices are helping boost government revenues, along with export earnings, narrowing the external current account deficit. However, high non-performing loans (driven by the government arrears with construction firms) and undercapitalization in the domestic banking system, are a hinderance to private credit expansion, limiting further growth in private domestic investment and non-hydrocarbon sector.
Policies need to balance short-term urgencies ¾ including to support food security and the banking system ¾ with long-lasting overarching reforms to ensure macroeconomic stability, improved social outcomes, and strengthened governance and transparency, delivering sustainable and inclusive economic growth.
African trade news
ECA launches Africa Trade Exchange platform to facilitate trading under AfCFTA (Ghana Business News)
The Africa Trade Exchange (ATEX), a business-to-business (B2B) e-commerce platform, was launched during the official opening of the 54th Conference of African Ministers of Finance, Planning, and Economic Development (CoM2022) on 16 May in Dakar, Senegal. The launch took place in the presence of Senegal’s president, Macky Sall, who is also the Chairperson of the African Union. The platform was developed by the Economic Commission for Africa (ECA) and the African Export-Import Bank (Afreximbank), in collaboration with the African Union and the AfCFTA Secretariat to serve as a B2B and business-to-government (B2G) digital marketplace. ATEX will enable pooled procurement of basic commodities to ensure countries have access to scarce supplies in a transparent manner. ATEX is connected to the digital ecosystem to support the implementation of the African Continental Free Trade Area (AfCFTA) Agreement and provide buyers and member States with quality products from verified suppliers in a more efficient way at average cost, thereby improving cross-border trade.
Local firms urged to tap into AfCFTA (Mmegi Online)
Local businesses have been urged to take advantage of the African Continental Free Trade Area (AfCFTA) to open themselves up to the opportunities available on the continent. Pan African Chamber of Commerce and Industry (PACCI) executive director, Kebour Ghenna told a Small Business Exporters conference this week that Africa should find another way of fostering prosperity by building economic solidarity that can become the base for progressive power needed to create a transformed African economy. “If we don’t get busy making the AfCFTA work and opening back up to the continent, we’ll be left on the outside looking in,” he said. “An AfCFTA that does not embrace solidarity is doomed to fail and fail swiftly. “An AfCFTA that expands inequality and only empowers the rich economies of the world should not be acceptable.”
Senegal’s Macky Sall: Multilaterals put Africa in ‘straitjacket’ (African Business)
Senegalese President Macky Sall has criticised the multilateral financial system and argued that the current deal for Africa is a handbrake on its development. “Explaining underdevelopment in Africa is very simple. The rules set up by international institutions have put us in a straitjacket… The rules are unfair, outdated, and need to be disputed,” he told delegates attending the ECA’s Conference of African Ministers of Finance, Planning and Economic Development in Dakar’s conference centre. “It is time for Africa to speak out. The voices should not just be those of leaders but of finance ministers and others affected by a system that works against the continent. We must look for innovative solutions.”
Africa not where it should be: Analysts (The Herald)
Advocates of pan-Africanism and decolonisation have urged African governments to invest in the creative industry and establish pro-African institutions to successfully defend the continent against neo-liberalism and its proxies coming in the form of non-governmental organisations (NGOs). The sentiments come after President Mnangagwa yesterday, writing in his column in The Herald’s sister paper, The Sunday Mail, warned the nation against a rising “new wave of fake nationalism” which is using all possible means to re-establish Western dominance in Africa. NGOs, mostly funded by Western countries, have been criticised for representing a continuity of the work of some of their precursors, the missionaries and voluntary organisations, that co-operated in Europe’s colonisation and control of Africa.
“Right now African borders are closed but there are three things that are supposed to move freely on this continent. The free movement of people, capital and goods and services was agreed in 1963 and there is no need for successive summits to implement these resolutions since 1963. We can defeat these NGOs and it is in our hands to do so. “Africa now needs to be more radical, courageous and unapologetic because we are not where we are supposed to be. We have Africans who cannot move freely on our continent with countries demanding visas while Europeans and Americans travel without any restrictions here,” said Ambassador Muzavazi.
“As a continent we need to acknowledge that the best way to have speedy growth in Africa will only be achieved through regional economic integration to achieve positive growth and development agenda. What African leaders need to work on is to invest in regional infrastructure, policy harmonisation and increased free movement of cross-border investments and labour. That will help us get where our founding fathers wanted us to be,” said Mr Muroiwa.
A new digital information system to monitor and speed up cross border truck movements and driver health checks at land borders in Eastern and Southern Africa was launched on 20th May 2022 at Tlokweng Border Post in Botswana. Part of the Team Europe’s Global Gateway initiative and response to the COVID-19 pandemic, the Corridor Trip Monitoring System (CTMS) was funded by a €1.6 million grant from the European Union (EU) and more than €500,000 from the Federal Republic of Germany. The CTMS has now been installed at major commercial border posts in Botswana, Namibia, Zambia, and Zimbabwe, along sections of three regional transport corridors, and will soon be installed in other Eastern and Southern African countries. The CTMS is spearheaded by the Southern African Development Community (SADC) on behalf of COMESA, EAC and SADC.
Once fully operational, the system will minimise the need for paperwork and speed up border procedures, reduce waiting and transit times and allow trucks to deliver essential goods more quickly, while ensuring health and safety measures under COVID-19 protocols.
The system equips border agents with hand-held devices to check, validate and register the COVID-19 health status of truck drivers and their crews, as well as the compliance of their vehicles with cross-border regulations and road safety rules. Transport operators will use a custom-made app to upload vehicle and driver health information onto the CTMS website. This information can then be instantly accessed by authorised border and law enforcement officials in the country of destination and transit by scanning QR codes shown by drivers. The CTMS also allows authorities and operators to monitor driver trip progression and deviations against pre-approved routes and designated rest areas.
The system builds on the achievements of the €21 million EU-funded Tripartite Transport and Transit Facilitation Project (TTTFP). Key results of the TTTFP include the development of the Guidelines for Transit of Essential Goods during the pandemic state of emergency and the two Tripartite Multilateral Agreements (the Vehicle Load Management Agreement and the Multilateral Cross Border Road Transport Agreement).
Zambia weighs in on SADC Model Law (Zambia Daily Mail)
STANDING Committees of the SADC Parliamentary Forum and the Regional Women’s Parliamentary Caucus (RWPC) have unanimously endorsed a draft SADC Model Law on Public Financial Management (PFM) and will soon commend it to the highest decision body of the Forum, the Plenary Assembly, for adoption. The endorsement happened at the end of a two-day consultation over the draft Model Law on PFM that took place in Johannesburg, South Africa, recently.
The validation was the climax of a series of similar engagements with different stakeholders over several weeks, as the SADC PF sought buy-in and strengthening of the model law, the first of its kind in the world. The range of consultations gave rise to a wide range of improvements to the model law reflecting the perspectives and objectives of a wide range of public and private professionals with involvement or interest in public financial management.
Zambia’s Minister of Finance and National Planning Situmbeko Musokotwane was the guest of honour at the final validation meeting, which took place on April 28-29, 2022. In a keynote address, Dr Musokotwane said the impact of public finances spent on community projects is important to Members of Parliament (MPs) because they are the interface with the communities they represent.
ECOWAS Revenue decreases by 5% - Commissioner (Federal Radio Corporation of Nigeria)
The Commissioner for Finance at the ECOWAS Commission, Mrs. Halima Ahmed says there was a 5% deduction of the revenue of the Economic Community of West African States, ECOWAS, in 2022. She made this known in Lome, Togo, where she gave an overview of the Community’s 2020 Consolidated annual financial report at the delocalized meeting of the joint committees of the ECOWAS Parliament which includes Public Accounts/Administration; Finance and Budget; Macroeconomic Policies and Economic Research; as well as Trade and Customs. According to Ahmed, the revenue accrued to the Community from all sources decreased by about 13 million UA (Unit of Account), representing 5 percent, from 257 million UA in 2019 to 244 million UA in 2020.
AfDB to lend $500 million to women in 2022, to raise $5 billion for women businesses in Africa (Nairametrics)
The President of the African Development Bank (AfDB), Dr. Akinwumi Adesina, says that the financial institution would lend $500 million to women in 2022. This is as the bank’s Affirmative Action for Women in Africa (AFAWA) is raising the sum of $5 billion with the support of the French President, Emmanuel Macron and G-7. This disclosure is contained in a statement posted on Sunday, May 22, 2022, by Adesina on his official Twitter account, where he also added that the bank paid out $483 million to financial institutions to lend to women businesses in 2021. Adesina, whose statement is coming as the bank commences its Annual Meetings for 2022, is commending the Board of Governors, Board of Directors, management and all the hardworking staff of the bank for all their relentless work.
The AfDB boss said the board had approved a crisis response facility of up to $10 billion based on rigorous risk assessments when the COVID-19 pandemic struck, adding that it launched a $3 billion COVID-19 social bond on the global capital markets, the highest ever US dollar-denominated social bond in world history.
Kigali Communique outlines principles for a just and equitable energy transition (UNECA)
During the global SEforALL Forum in Kigali from 17-19 May 2022, Ministers and high-level representatives from the Democratic Republic of Congo, Ghana, Kenya, Malawi, Morocco, Nigeria, Rwanda, Senegal, Uganda, and Zimbabwe met to discuss the requirements for a just and equitable energy transition in Africa. The meetings were facilitated by the Rwanda ministry of infrastructure, SEforAll and ECA. The outcome of this Ministerial meeting was the Kigali Communique from the 10 countries that expresses seven key principles to address development gaps, and to put Africa on a pathway, aligned with the Paris Agreement on climate change, to economic prosperity and Net-Zero.
With the communique, Rwanda and the other represented countries call on partners to align with these principles of a just and equitable energy transition in Africa, to turn their commitments into action, and to join them in working towards meaningful progress on an energy transition that will benefit our future generations.
Growing hunger, high food prices in Africa don’t have to become worse tragedy (Africa Renewal)
In the aftermath of the COVID-19 pandemic, world hunger increased substantially – estimates from the State of Food Security and Nutrition around the World (SOFI) reveal that as many as 161 million people fell into hunger between 2019 and 2020, bringing the world´s total to 811 million people facing food insufficiency. In other words, about one in 10 people in the world went to bed without enough nutrition in the first year of the COVID-19 pandemic.
Africa has been particularly vulnerable: about 21% of people on the continent suffered from hunger in 2020, a total of 282 million people. Between 2019 and 2020, in the aftermath of the pandemic, 46 million people became hungry in Africa. No other region on the world presents a higher share of its population suffering from food insecurity. Also, African households spend a large share of their income on food. According to a recent note in the Financial Times, citing estimates from the IMF, food represents 17% of expenditure in advanced economies, in sub-Saharan Africa the figure is 40%.
The stress signals are present, but the challenge of growing hunger in Africa does not need to become a worse tragedy: the world has learned from past experiences, and the sooner national governments and the international community act, the better the results.
Some actions have already been taken – others not taken. For example, food trade has not been severely halted as it was during the 2007-2008 food price spike. This is a good start. However, a complex problem with multiple causes and consequences needs a battery of policies and interventions, many of which have proven effective in the past.
The ability to access food via trade, production, work, or transfers change in time of crisis, especially for some vulnerable groups. Mr. Sen´s insight is so powerful because it recognizes that issues of hunger, starvation and malnutrition go well beyond food systems and depend on social arrangements (including the markets for food and labour, for instance), the economy, and the functioning of the state and governments.
Amid a looming food crisis, Ethiopia has emerged as an African country that has taken significant steps to achieve self-sufficiency in food production. With support from the African Development Bank’s agricultural Technologies for African Agricultural Transformation program, Ethiopia has not imported grain in 2022, African Development Bank President Akinwumi Adesina emphasized during a meeting with G7 development ministers meeting on Thursday. This comes as Africa faces a severe shortage of at least 30 million metric tons of food supplies arising from the Russia-Ukraine war. The war has especially affected wheat, maize, and soybeans imported from both countries.
Ministers from several African states, including Senegal, South Africa, Tunisia and Zambia attended the meeting, convened by Germany, which holds the current presidency of the G7. The African ministers played an active part in discussions on the core subject matter: “Response to Multiple Crises on the African Continent – focusing on Food Security.” Representatives of the African Union Commission, the International Fund for Agricultural Development, the International Monetary Fund, the United Nations Development Programme, the World Bank Group and the World Food Programme also took part in the meeting.
Albert Muchanga, commissioner for Trade and Industry of the African Union Commission, said despite efforts across Africa to resolve food production, Africa remained a net importer of food, and stressed that the time had come to end this.
African Development Bank Board approves $1.5 billion facility to avert food crisis (AfDB)
The African Development Bank Group’s Board of Directors on Friday approved a $1.5 billion facility to help African countries avert a looming food crisis. With the disruption of food supplies arising from the Russia-Ukraine war, Africa now faces a shortage of at least 30 million metric tons of food, especially wheat, maize, and soybeans imported from both countries. African farmers urgently need high-quality seeds and inputs before the planting season begins in May to immediately boost food supplies. The African Development Bank’s $1.5 billion African Emergency Food Production Facility is an unprecedented comprehensive initiative to support smallholder farmers in filling the food shortfall. The African Emergency Food Production Facility will provide 20 million African smallholder farmers with certified seeds. It will increase access to agricultural fertilizers and enable them to rapidly produce 38 million tons of food. This would be a $12 billion increase in food production in just two years.
Why Chinese demand for African imports might defy Covid lockdowns, supply chain snarls (Yahoo Finance)
China’s months-long lockdowns of Shanghai and other major cities amid a Covid-19 outbreak has sparked global logistics delays feared to last months, as well as concerns of a slowdown in the world’s No 2 economy. But there will be minimal impact on Chinese imports from Africa, especially of agricultural goods and industrial raw materials, even though exports to the continent will be hit, according to observers. Shanghai, home to the world’s busiest container port, has been under near-total shutdown for almost eight weeks. This has caused a huge backlog of cargo vessels offshore, with importers expected to face further delays after prolonged factory and port closures.
Most African countries are heavily dependent on China trade, with the resource-rich among them exporting most of their oil, minerals and metals to the country, while Chinese exports to the continent include electronics, machinery, fabrics, clothing and home appliances. “Given that Shanghai and the surrounding region is a major production hub of electronics, exports of these products to Africa will be heavily disrupted, possibly through the second and third quarter of this year,” said Tommy Wu, Hong Kong-based lead China economist at Oxford Economics.
China has promised to grow imports of African agricultural products, to offset the heavy domination of metals and raw materials, and improve the trade balance.
Why export to the UK (GOV.UK)
The UK and some African countries have trade partnership agreements, providing preferential trading terms. The UK government also funds various schemes to encourage businesses from Africa to export to the UK.
Trade agreements between 2 countries or groups of countries enable importers and exporters to trade under preferential terms, which reduces costs. For example, 2 countries may agree to charge each other low or zero tariffs on specific types of goods, or to recognise each other’s product standards. The UK currently has trade agreements, called Economic Partnership Agreements (EPAs), with these countries in sub-Saharan Africa:
The UK government has proposed new trading rules for developing nations under the Developing Countries Trading Scheme (DCTS). The DCTS aims to grow free and fair trade with up to 70 qualifying developing nations, supporting jobs and growth.
As well as supporting trade between the UK and Africa, the UK is looking for exports in sectors where economic development can have the greatest development effect in Africa.
Global economy news
Food Prices: Countries Urged to Expand Food Production as WTO Downgrade Trade Forecast to 3% in 2022 (This Day)
To prevent the acceleration of acute food insecurity trends in the coming months and years, the United Nations has stressed the importance of expanding food production at the country-level by providing cash and critical inputs for cereal and vegetable production, as well as protecting livestock with treatments, vaccinations, feed and water.
This was emphasized at a United Nations Security Council meeting, held in New York, and chaired by the U.S. Secretary of State Antony Blinken.
“Agrifood supply chains and value chains must be strengthened with the engagement of the public and private sector in support of smallholder farmers and households,” Director General, FAO, QU Dongyu said.
Forward Thinking on trade, vaccines, and sustainable and inclusive growth with WTO Director-General Ngozi Okonjo-Iweala (McKinsey & Company)
The pandemic has had far-reaching consequences, with unprecedented disruptions, including to the global economy and world trade. Talk us through the impact on global trade. Ngozi Okonjo-Iweala: We’ve seen the most visible kind of form of impact on global trade, which is the supply chain issues that we’re facing now. I can start there. I think when the pandemic struck, many investors, many businesses, perhaps decided that there was going to be a long or deep recession and pulled back on investment plans. Shipping companies left containers in the wrong places. They didn’t know that anything other than a deep recession would follow. And what happened is that with the massive amounts of fiscal stimulus we saw—particularly in the developed countries, particularly in the US, $26 trillion worth of fiscal stimulus—and monetary policy easing, money in the pockets of households and easing for businesses have led to unprecedented demand for goods. That was also heightened by the digital access to online or digital trading, to e-commerce. And so we have a supply-demand mismatch that has led to the kind of supply chain issues that we’ve seen.
INTERVIEW: Africa, Mideast will likely suffer most from reduced grain shipments - WTO director general (Ahram Online)
Amid the severe crisis in global trade came another major catastrophe on both the humanitarian and economic levels — the Russian-Ukrainian War, which continues to rage and shows no signs of ending any time soon.
The World Trade Organisation (WTO) has some solutions in response to the need for international cooperation and fruitful coordination between the countries of the world and dealing with export restrictions with some caution in order to alleviate the impact of these crises worldwide.
Global trade has been impacted significantly. Supply chain problems have worsened. Our economists have issued their trade forecast for 2022 and 2023, taking into consideration the war in Ukraine. They predict that global trade growth this year could be cut by one third, from the 4.7% the WTO forecast last October to 3%. Some regions will be more strongly affected by the conflict than others. Europe is the main destination for both Ukrainian and Russian exports and will likely experience the brunt of cuts in supply. But it is Africa and the Middle East that will likely suffer the most from reduced shipments of grains and other foodstuffs. This trade disruption will boost prices of agricultural goods and bring negative consequences for food security in poorer regions.
A Threat to Global Innovation at the WTO (Alice Echo News-Journal)
The World Trade Organization recently announced that the United States, European Union, India, and South Africa had finalized a proposal to waive intellectual property protections for Covid-19 vaccines. Soon, all 164 WTO member nations will vote on whether to implement the proposed waiver. The terms it outlines would be revolutionary — that is, in undermining the rules for intellectual property protection. The bedrock of this system is the Agreement on Trade-Related Aspects of Intellectual Property Rights, known as the TRIPS Agreement — which since 1995 has established explicit minimum standards WTO members must meet in respecting one another’s patents, trade secrets, trademarks, and copyrights.
Yet some nations in the developing world have long bristled at TRIPS and sought to modify it. This has especially been true in the case of medicines.
But the TRIPS Agreement includes a provision that addresses this concern. When a country is facing an “extreme urgency” — say, a public health crisis — and is unable to secure the medicine it needs or negotiate a voluntary license with a patent holder, it can issue a “compulsory license” to authorize local manufacturers to produce the needed medicine for its own population. But this safety valve does not invalidate the ownership of the patent-holder — thus preserving the core of IP protection.
Seven Finance Trade Lessons from COVID 19 for Future Pandemics (IMF)
Pandemics and epidemics pose risks to lives, societies, and economies, and their frequency is expected to increase as rising trade and increased human interaction with animals leads to the emergence of new diseases. The COVID-19 pandemic teaches us that we can and must be better prepared, with scope for much greater global coordination to address the financing, supply-chain, and trade barriers that amplified the pandemic’s economic costs and contributed to the emergence of new variants. This paper draws seven early lessons from the COVID-19 pandemic that could inform future policy priorities and help shape a better global response to future crises.
Container ships spend 20% more time in ports (Sunday Observer)
If you’ve never lived near a port or worked in one, you may be unaware of the vital role they play in our lives. Most of the products we consume daily travel through ports, making them a key link in the global production and supply chains we rely on. “Our livelihoods – food, jobs, energy – depend on functioning and resilient supply chains,” UNCTAD Secretary-General Rebeca Grynspan said. How ports are managed has implications for economic growth, crisis response efforts, environmental protection and gender equality, placing them at the heart of sustainable development. The efficiency of a port directly affects the economies of the countries it serves, since more than 80% of global trade is carried by sea. The percentage is even higher for many developing countries.
The World Economic Forum announced today the theme and details of its Annual Meeting 2022, to be held 22-26 May in Davos-Klosters, Switzerland. The theme is, History at a Turning Point: Government Policies and Business Strategies. After a two-year hiatus, the meeting will bring together nearly 2,500 leaders and experts from around the globe, all committed to the “Davos Spirit” of improving the state of the world. A list of confirmed public figures can be found here. Against the backdrop of deepening global frictions and fractures and a once-in-a-century pandemic, the unprecedented global context calls for purpose and resolve, and the meeting’s ambition is to rise to these challenges. Over the past two years, the World Economic Forum has strengthened its impact initiatives, which deal with issues ranging from COVID-19 and climate change to education as well as technology and energy governance.
With the world at such a critical turning point, global business and government leaders need to work together to develop long-term policies and strategies that will revitalize the hard-hit global economy, strengthen the progress made to advance the Fourth Industrial Revolution and tackle the single greatest threat to humanity, climate change.
Minister Mmamoloko Kubayi leads South African delegation to World Economic Forum in Switzerland, 22 to 26 May (South African Government)
Namibia joins 2022 World Economic Forum in Davos (Namibia Economist)
DDG González: “Trade is essential to win the fight against climate change” (WTO)
DDG González highlighted that trade is critically important for countries in Latin America and the Caribbean to access the goods, services and technologies needed to adapt to climate change and decarbonize their economies, adding that trade officials need to take a serious look at the barriers that may hinder the emergence of an efficient, globally integrated market for the clean technologies of today and tomorrow.
“We must make sure that trade and climate policies pull in the same, not in opposite, directions, because the wrong trade policies can set back efforts to achieve climate and other environmental goals,” she said.
If climate adaptation and mitigation measures aren’t taken seriously, the United Nations Conference on Trade and Development (UNCTAD) 2021 report puts developing countries in danger. Many developing nations, especially least developing countries (LDCs) and small island developing states (SIDS), will confront major hurdles in maintaining production, related employment, and export levels in these sectors in the future, according to the report. “Unless developing countries enhance their trade resilience ex-ante through adaptation measures and actions that reduce exposure and risk, they will export substantially less in climate-sensitive sectors ex-post as climate change impacts accumulate over time. When adaptation is neither possible or cost-effective, diversification within the sector, or economic restructuring to move resources to other less climate-sensitive sectors, can be pursued,” the report said.
Time to transform agrifood systems in response to multiple shocks and worsening food security (FAO)
The Director-General of the Food and Agriculture Organization of the United Nations (FAO), QU Dongyu, today made an urgent call for the transformation of agrifood systems, to make them more inclusive, economically viable and resilient to multiple shocks, as well as to produce better and more with less negative impact on the environment. Qu was addressing a ministerial meeting held at the United Nations in New York entitled “Global Food Security Call to Action.” Cumulative effects of multiple shocks related to conflicts, the climate crisis, the COVID-19 pandemic, economic downturn, rising food prices have increased people’s vulnerability and pushed hundreds of millions of more people to the brink of hunger, the Director-General said. According to the Global Report on Food Crises released earlier this month, in 2021 193 million people were acutely food insecure and in need of urgent assistance across 53 countries/territories. Projections point to around 329 000 people reaching catastrophic food insecurity (IPC 5) in Somalia, South Sudan and Yemen by the end of 2022.
At the Sustainable Energy for All Forum in Kigali, Rwanda, and amid increased pressure from the climate crisis and the war in Ukraine on the world’s energy systems, the UN Development Programme called for vastly increased public and private investment to transform energy systems in support of a just energy transition. “We are in a moment of profound global upheaval. The war in Ukraine has caused immense human suffering, and the ripple effect of that war – on our finance, food, and energy systems – threatens to tip millions more people into poverty and hunger,” says Achim Steiner, UNDP Administrator and Co-Chair of UN-Energy in his message at the closing plenary of the Forum. “The current geopolitical situation reminds us just to what degree energy underpins our aspirations for a more sustainable future for all. There are still viable pathways to reach a net-zero global energy system while finding solutions to vulnerable communities, but the window is narrowing fast. It requires an unprecedented transformation of the energy sector. All countries must now reset their energy systems and put people into the center – ensuring that these systems are cleaner, more secure, more resilient and totally inclusive.”
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Local trade news
Inclusivity, resiliency focus of South Africa’s tourism sector recovery (Engineering News)
As South Africa rebuilds its Covid-19-devastated tourism sector, focus must be given to the development of an inclusive, resilient and transformed tourism industry and economy. Speaking to media prior to her Budget Vote on Thursday, Tourism Minister Lindiwe Sisulu said that as the Department of Tourism works to stabilise the sector and strategise for a path to recovery, it is engaging with stakeholders and drawing lessons on how to build a resilient and inclusive sector.
Steel Master Plan presents immediate opportunities for industry, govt (Engineering News)
There are a number of opportunities for both government and industry to capitalise on immediately while pursuing the implementation of the Steel Master Plan, speakers agreed during a panel discussion at the Mainstreaming the Steel Master Plan Conference on May 19. Manufacturing Circle executive director Philippa Rodseth mentioned municipal infrastructure as an example. As a result of the municipal infrastructure challenges facing the country, there is a lack of proper service delivery, impeding manufacturing.
Agri-food: Boosting agri-food trade to South Africa on EU agenda (Agriland)
With increasing opportunities for trade between the EU and South Africa opening up in South Africa’s food sector since the signing of the EU-South Africa Economic Partnership Agreement (SADC-EPA) in 2016, the EU is hosting day two of the seminar today (May 19) at a conference venue in Johannesburg. This interactive event – which is being streamed – will give South African food professionals a unique opportunity to hear first-hand from policy makers and industry experts as they uncover insights into how the safety, quality and sustainability of EU food and beverage products represent valuable opportunities for your business to win loyal customers in South Africa and beyond, according to an EU spokesperson.
Day one looked at ways to boost EU-South Africa agri-food trade, followed by presentations and breakaway sessions on the EU’s food safety and quality systems, including its Farm to Fork strategy to accelerate sustainability.
With the EPA also including the protection of 249 European Geographical Indications (GIs) covering foodstuffs, beer, spirits and wine, day two takes a deep dive into the opportunities of the GI system, using EU cheese as a case study.
India has put an immediate halt on wheat exports: What does this mean for SA? (IOL)
The US Department of Agriculture (USDA) anticipated lower wheat output for the current crop season in its latest May 2022 report, owing to tiny crops from Ukraine, Morocco, Argentina, the EU and China. Consumption, on the other hand, is expected to climb due to population growth, with trade expected to reach new highs, fuelled by imports primarily from Africa.
In the midst of the current conflict in Ukraine, which has resulted in a limited supply of sunflower oil and wheat, India was seen as one of the saviours, sending much-needed wheat with Australia. This came amid projections of higher-than-normal export stock.
However, due to a severe heatwave that began in mid-March 2022 in India, wheat output forecasts have been lowered. The lowered output forecast and rising domestic wheat prices led India imposing embargo and restricting exports.
South Africa requires around 1.4 million tons for the 2012/22 market season, which concludes at the end of September 2022. South African consumers may witness an increase in wheat prices in the second half of 2022, although this will be in line with global trends and market pressures.
What China’s stark economic slowdown means for South Africa (Daily Maverick)
All eyes have been on China’s fast-deteriorating economy over the past week, with exports, retail sales, new home prices and industrial production all coming in way below expectations. “There will be a global impact, since China is still the world’s factory,” says Old Mutual Multi-Managers investment strategist Izak Odendaal. And, he adds, “China matters greatly for South Africa.” Not only is China South Africa’s main trading partner, but industrial commodity prices depend on Chinese demand and, while still elevated and good for South Africa, they have come off as a result of Chinese lockdowns in March.
In the immediate future, the likelihood of South Africa continuing to benefit from higher commodity prices will depend on whether the upward pressures on commodity prices – namely the Russia-Ukraine war and supply issues – outweigh a reduction in China’s appetite for commodities as its economy loses momentum. For now, it still seems the upward pressures on prices will prevail. On a longer-term view, however, recent World Bank in-depth research into “commodity markets and their evolution, challenges and policies” highlights how important it is that countries relying on commodities to underpin their economy, like South Africa, put in place policies that address the asymmetric effects that commodity price shocks have on commodity exporters.
Rich nations offer debt guarantees on South African climate deal (Engineering News)
A group of the world’s richest nations offered South Africa debt guarantees as part of a proposed $8.5-billion deal designed to cut the nation’s reliance on coal for power generation, people familiar with the talks said, potentially resolving one sticking point in the negotiations. The guarantees would enable South Africa or companies such as state power utility Eskom Holdings to borrow money needed to close down coal-fired power plants and enable the generation of renewable energy, one of the people said. The people asked not to be identified as the talks aren’t public.
Botswana to ban more veggie imports (The Namibian)
Namibian exporters of vegetables to Botswana, especially those along the fertile Zambezi region, might have it tough if that country effects its plan to expand its ban on vegetables. Despite being a subscriber to the African Continental Free Trade Area, which calls for the free flow of goods and services, the Botswana government says it has no plans to lift its current ban on vegetable imports either. In fact, it reportedly plans to expand its list, which comprises 16 vegetables, over the next two years. The country’s list of banned commodities includes tomatoes, carrots, beetroot, potatoes, cabbage, lettuce, garlic, onions, ginger, turmeric, chilli peppers, butternut, watermelons, sweet peppers, green mealies and fresh herbs. Namibia also restricts the importation of vegetables, including some on Botswana’s list. The Namibian Agronomic Board (NAB) controls the flow of imports and exports in Namibia, and measures this in relation to expected harvests and local demand.
Pakistan overtakes Uganda as top market for Kenyan exports (Business Daily)
Pakistan overtook Uganda as Kenya’s biggest export destination in the first quarter of the year, boosted by growth in tea exports. Exports to the Asian country rose by 21.5 percent to Sh16.86 billion from Sh13.87 billion in the corresponding period of last year. The value of exports to Uganda marginally rose by 0.4 percent in the period to Sh16.68 billion. Pakistan is the largest buyer of Kenyan tea, and volumes were expected to increase after the removal of the 0.5 percent attestation fee charged on tea export by Pakistan in August 2021.Tea stakeholders had for years lobbied for the removal of the levy, which made Kenya’s tea more expensive in Pakistan compared with beverage from other countries. Other top export markets included the Netherlands and USA which recorded purchases of Sh15.83 billion and Sh14.78 billion respectively.
During the period, however, the country’s trade deficit increased by Sh34.2 billion or 10.8 percent in the first quarter due to a surge in imports led by fuel and industrial supplies. The country’s import bill rose by 16.6 percent to Sh591.6 billion, widening the trade gap to Sh351.54 billion despite a 26.3 percent growth in exports to Sh240.1 billion.
Rwanda reviews restriction on Ugandan imports (The East African)
Rwanda says it is reviewing its trade list with Uganda before its goods can be allowed on its market, almost four months after opening its main border. While free movement of people between the countries has resumed, there is still restriction on imports from Uganda. This week, Rwanda’s Prime Minister Edouard Ngirente told a press briefing that the process of reviewing the trade list is almost complete and the goods will soon be allowed in the market subject to quality checks. The review was necessary because Rwanda wants to enforce quality as well as protect local manufacturers who had started producing some goods that were previously imported from Uganda, he said. Ugandan products, the PM said, must comply with the set standards on the Rwandan market.
Ugandan importers and exporters will be required to apply for a licence from the Rwanda Food and Drugs Authority (FDA) for industrial- manufactured products and Rwanda Inspectorate, Competition, and Consumer Protection Authority (RICA) for agricultural products.
Budget: MPs outline their priorities on govt spending (The New Times)
While presenting the proposed Rwf4.6 trillion national budget for the 2022/23 fiscal year to legislators, Ndagijimana said that the budget, which will start on July 1, will focus on the implementation of the government’s strategies meant to speed up economic recovery from the Covid-19 pandemic. It also emphasises continued implementation of the ambitious national strategy for transformation (NST1) – a seven-year government programme running from 2017 through 2024.
MP Ntezimana said that the Made in Rwanda programme is needed as it has proven to promote import substitution. However, he said that the prices of the products made in the country are still high, which threatens their competitiveness compared to imported products. “For this to be achieved, the local businesses should be supported, including reducing taxes on the locally made products so that they become affordable,” he said, calling for booting exports.
Govt cuts Mtwara, Tanga port charges (IPPmedia)
Prime Minister Kassim Majaliwa said in his question and answer session in the National Assembly yesterday that the ports can attract more traders in neighboring countries such as Malawi, Zambia, Mozambique, Democratic Republic of Congo and even South Sudan, when their competitiveness is aligned with the port of Dar es Salaam. The government had sunk billions of shillings in their rehabilitation, he said in responding to Abdallah Chikota (Nanyamba) who demanded what the government intends to do to attract more transit goods traffic from member countries of the Southern Africa Development Community (SADC) apart from neighbouring EAC members. All levies upon port users will be deducted, while the government plans to buy cargo loading and off-loading equipment to speed up work, noting that the levy deductions will not be applicable to other ports as it only seeks to enhance competitiveness in the two ports.
Commendable Export Diversification Moves - EBR (Satenaw Ethiopian News)
For any developing country, foreign currency is a critical tool assisting not only with local grass-roots development but also contributing significantly to a nation’s overall economic health. For its forex flow, Ethiopia benefits tremendously from the support of its diaspora which contributed USD3.6 billion last fiscal year. Addressing the local business community recently, Prime Minister Abiy Ahmed (PhD) said “the crisis of hard currency will not be solved today, nor will it in the next 15 or 20 years.” The Premier pleaded for an urgent need for more cooperation with the private sector to find a solution, adding that remittances from the Ethiopian diaspora had reduced for political reasons.
He stated in his report that export trade earnings grew substantially—by USD37 million or 25Pct—but there’s still the need to diversify, especially into manufactured exports. Further, the country was able to save USD1 billion through import substitution by mostly reducing purchases of food, grains, and coal for cement manufacturers. Ethiopian export numbers are a mixed bag but far from fulfilling their promise.
Ivory Coast Leads West Africa’s Local Content Developments (Energy Capital & Power)
Historically, the Ivory Coast’s hydrocarbons industry has been a modest one with just 36,000 barrels of oil per day but with the 2021 discovery of two billion barrels of reserves and 57 cubic meters of natural gas by Italy’s Eni, a major mark was made for the future of the west African country. As its extractive industries ramp up, Ivory Coast’s newfound hydrocarbons wealth combined with its emerging economy, and important role in regional integration initiatives, may mean the right mix required for a powerhouse country in the making. With an average of 8% GDP growth for a decade, the country has been one of few sub-Saharan African nations to successfully maintain stable economic growth amidst the COVID-19 pandemic. The country is rated 110 out of 190 countries on the World Bank’s Ease of Doing Business index, ahead of almost every nation in the region. However, the Ivory Coast’s crucial strength derives not from its independent prowess but from its key participation in regional integration initiatives.
New Report Recommends Ways to Strengthen Tunisia Disaster Preparedness (World Bank)
A new report launched today by the World Bank, the Government of Tunisia, and the Global Fund for Disaster Risk Reduction and Recovery examines ways to improve the capabilities of Tunisia’s National Meteorological and Hydrological Services with the aim of supporting socio-economic development to save lives and livelihoods. Tunisia is highly prone to climate-related disasters, such as floods, droughts, extreme temperatures, and sea level rise. The latest World Bank’s disaster risk profile of the country estimates that floods alone cause an average annual loss of US$40 million (or 0.1% of Tunisia’s 2018 GDP). Underlying factors, including climate change, population growth, land use changes, and urbanization, increase the severity and frequency of these events. The report, Strengthening Hydromet and Early Warning Systems and Services in Tunisia—A Roadmap, proposes three successive development phases designed to transform meteorological and hydrological service providers in Tunisia into technically sound and modern entities that can meet their public service mandates. It shows that the benefits of weather, climate, and hydrological (hydromet) services outweigh the capital and operational costs of providing them.
African trade news
Deputy Secretary-General’s video message to the Opening Ceremony Africa Trade & Investment Forum Africities Summit Kisumu (African Business)
This first African Trade and Investment Forum of UCLG Africa aims to become a matchmaking platform between local authorities in Africa and investors, to identify business opportunities and investment strategies. Local investment needs can be structured to match and attract national, regional, and international investments – through the definition of pipeline of projects. Challenges range from institutional constraints, limited capacities, and regulatory hurdles to looming debt burdens and re-payments following the expiration of the Debt Service Suspension Initiative. At the global level, the Secretary-General has been advocating for greater debt relief and liquidity to support countries across Africa.
Today, I see four priorities: First, local governments’ capacities need to be strengthened to fully play their role as catalyzers in mobilizing public and private capital for growing cities. Second, local policies should be implemented to create an enabling business environment to facilitate investments – including by providing targeted public investments and skilled human capital. Third, we must accelerate the implementation of the African Continental Free Trade Area (AfCTA) in African cities and territories. The AfCTA is the largest trade area in the world since the formation of the World Trade Organization and is expected to boost intra-African trades by 52 percent in the coming 5 years. And business and trade will happen at the level of cities and territories. And fourth, cities need to venture into national and international bond markets. At present, only a few African cities have done so.
Lack of infrastructure hinders Africa’s intra-trade expansion (IPPmedia)
The intra trade in Africa remains at 15 percent lagging behind Europe whose intra trade stands at 70 percent respectively. The AU High Level Representative on Infrastructure Raila Odinga, made the remarks in Kisumu yesterday during the first day of the 9th Africities Summit at a High Level Dialogue on Infrastructure and Urban Development on Wednesday. “Infrastructure development is a priority and key ingredient for economic development. The major reason for low intra trade in the continent is the lack of infrastructure to connect its countries. There is a need to come with the African infrastructure fund to be self-sufficient in terms of funding,” said Odinga, who is also the Kenyan presidential candidate. Danny Faure who is former President of Seychelles called upon the need for Africa to choose the right infrastructure that will have an effective impact on the continent, citing the case of Botswana, where a new bridge has been built with its length at 71 meters all the way to Zambia providing a hub to Zimbabwe and Namibia. “The infrastructure is strategic and Africa needs it,” said Faure.
Future Manufacturing Africa: Trade Fair and Summit 2023 (Engineering News)
Exchanging valuable industry expertise to increase investment prospects in the African continent’s manufacturing sector. The manufacturing industry is crucial to the success of companies and their countries, as it is responsible for creating many goods, giving employment to millions of people, and making goods more affordable. Moreover, the African continent boasts high levels of global opportunities for investment across the manufacturing industry. The manufacturing export market in Africa has been growing. According to the World Bank, much of this growth can be attributed to the increased number of African countries that are now in the manufacturing sector.
We see growth spurts in key economic manufacturing countries and product drivers. Egypt, the biggest exporter of petroleum and petroleum products; Nigeria, the biggest exporter of flexible metal tubing; Ghana, the largest producer of cocoa beans in the world; are amongst budding African countries ready for investment and innovation. Other countries but not limited of interest are South Africa, Morocco, Algeria, Congo DRC, Kenya, Cote d’Ivoire and Uganda.
The continent is rich with raw materials and has a high demand for manufactured products. This trade show is an opportunity for companies to come and explore the potential of Africa. The purpose of the trade fair is to provide a platform for new and existing companies to share ideas, technologies, and equipment. The FMA Trade Fair and Summit 2023 connects investors, entrepreneurs and key stakeholders in the hope to create investment opportunities for possible partnerships and projects on the African continent.
Akufo-Addo urges African countries to work together and fully utilise AfCFTA (Myjoyonline)
President Nana Akufo-Addo has urged African countries to integrate more closely through competitive business, political cooperation, and investment to establish an African Beyond Aid agenda. According to him, African countries should make the most of the African Continental Free Trade Area (AfCFTA) by adding value to their resources before exporting them, in order to accrue more revenue. Speaking at the Academy of African Business and Development’s 22nd Annual Conference, President Akufo Addo said African economies can be transformed through value added industrialisation. “African countries need to work more closely, deeply and competitively through trade to enhance initiatives. Together, we need to build our continent and hold each other up.” “That’s the only way we can grow organically”, he added.
Sixth GITFIC conference to leverage African development (Ghana Business News)
The Steering Committee for the sixth Ghana International Trade and Finance conference will map out strategies that will enhance African trade and leverage the development of the continent. The conference, which will take place in Ghana’s capital, Accra, on 23rd and 24th May, 2022, will seek to update the evidence base of what is currently available in terms of reviewing the AfCFTA, data on digital trade. A statement signed by Mr Selasi Koffi
Agricultural crops trade between African countries expected to grow by 33%: Cairo 3A Agriculture (ZAWYA)
In a report titled ‘Connecting Africa’, CNN Network featured Ali Al-Gamil — CEO of Cairo 3A Agriculture. The report focused on the amount of commerce in African markets as well as the aspirations of the most notable exporters for trade growth in the continent. Additionally, the research examined the most serious difficulties that two-way transactions face in Africa. The assessment also emphasised Cairo 3A Agriculture’s agricultural potential as a prominent player in the production of premium grade citrus that is sold internationally, as well as the company’s ability to manufacture a wide range of food products. According to Al-Gamil, Africa is the final frontier, and success in the continent now would decide the value of Egyptian produce in the next decades.
He added that the greatest impediment to mutual trade between African countries is a lack of infrastructure, which causes everyday logistical interruptions. However, current infrastructure projects may help to progressively increase mutual trade between African countries.
Regional Senior officials from Ministries and Agencies responsible for Trade and ICT, met remotely on the 12th of May 2022 to consider orientations for an ECOWAS E-Commerce Strategy. Mr. Mickson Opoku, Director for Bilateral, Regional and Multilateral Trade, Ministry of Trade and Industry, representative of Ghana, who served as the Chair of the meeting, noted the relevance of this next phase in preparing the ECOWAS E-Commerce Strategy. He noted how an E-Commerce Strategy for the region would allow ECOWAS Member States to better take advantage of the African Continental Free Trade Area (AfCFTA).
Participants considered the presentation by UNCTAD and provided their feedback on the orientations for the e-commerce strategy. Member States noted the proposed areas for intervention, which centred on the need to; i) Strengthen and coordinate actions of trade ministries of Member States to make e-commerce a contributor to national and regional industrial efforts; ii) Enhance trust of potential e-commerce actors through the harmonization and update of the legal framework; iii) Monitor, follow-up and accompany the e-commerce sector; and iv) Adapt the strategic framework to priorities, objectives and targeted actors (including women and youth).
In the context of its African Ministers of Finance conference, CoM2022, the United Nations Economic Commission for Africa (ECA) has given the details of a path for African international sovereign debt liquidity and sustainability – the Liquidity & Sustainability Facility (LSF) it established and with the support of BNY Mellon and Amundi.
In an environment characterized by increasing debt burdens, historically high cost of borrowing, difficult post- Covid recovery, climate change related issues and energy and food shortages, there was a consensus among participants at the conference that tackling debt sustainability was a key issue.
Finance and development ministers from throughout the continent, together with the ECA, have been at the forefront of discussions on innovative mechanisms that can be added to the mix of tools used to address their various financial challenges. Private sector demand for investment products that promote sustainable development has been rising steeply in recent years. These “sustainability-themed products” were worth $3.2 trillion in 2020. Despite the vast green resources of Africa and increased investor demand for sustainability-themed products, the continent accounts for less than 1 per cent of global green bond issuances.
African Union weighs financial capacity against impact of COVID-19 and Ukraine crisis (AU)
The African Union is convening a High Level Retreat to evaluate and explore avenues to enhance the financial sustainability of the African Union, following the adverse effects of the COVID-19 pandemic and the Ukraine crisis on the economies of its member states. Convened under the theme “Beyond COVID-19 pandemic and Ukraine Conflict: Enhancing the Resilience of African Economies and Financial Sustainability of the African Union”, the meeting will consider a raft of issues, among them; the financial status of the African Union following the impact of COVID-19 and the Ukraine crisis on the national economies of Member States and the implications on their capacity to honour financial obligations to the Union. Relatedly, the Ministers will also review the implementation of the nine Golden Rules for financial management and accountability principles and other decisions adopted on Financing the African Union.
The retreat will also evaluate the implementation status of the 0.2 percent import levy that was adopted in July 2016 in Kigali, and intended to facilitate the sustainable and predictable remittance of Member States’ assessed contributions, towards the gradual financing of 100% of the operational costs of the Union, 75% of the program budget, and 25% of peace support operations. As at December 2021, seventeen (17) countries were at various stages of domesticating the Kigali Decision on Financing the Union. Read the Status Report on “Towards the Financial Autonomy of the African Union.”
Experts Move to Adopt New Strategies to Boost Post-COVID-19 Air Transport in Africa (This Day)
For one week, aviation experts from Africa and Indian Ocean (AFI) region met in Abuja to brainstorm on how to revive air transport system in Africa, which has been devastated by huge losses incurred due to coronavirus pandemic and its attendant lockdown.
African Union Commissioner for Infrastructure, Dr. Amani Abou-Zeid, kicked off discussion on the COVID-19 pandemic, which he said has caused devastating impacts on the lives and livelihoods of countries all over the world and the aviation industry, leading to deep losses and reductions in GDP, jobs, access to finance, and industry revenue.
“In Africa, the total estimated amount of the financial relief measures provided to airlines in Africa was only $2,721,539,647 (almost $2.7 billion) by end of 2021. This included the government support in the form of providing loans, guarantees, wage subsidies, and direct cash injections to airlines: $2,638,765,827 (almost $2.6 billion),” Abou-Zeid said. He noted that the economic and social impacts of the pandemic on African countries and the industry become more severe such that waiting for a full vaccine roll out is not a sustainable option.
After a successful project launch event in March 2022 and a Technical Committee Meeting held on 21 April 2022, the first Steering Committee Meeting of the Institutional Support to ECOWAS (ISE) Programme was held virtually on 17 May 2022. The meeting was co-chaired by Mrs. Halima Ahmed, Commissioner of Finance, ECOWAS Commission and Mrs. Cécile Tassin-Pelzer, Head of Cooperation, European Union Delegation to Nigeria and ECOWAS.
Mrs. Cécile Tassin-Pelzer indicated that ECOWAS is well on its way to achieve ‘‘the main objective of the programme which is to contribute to the transparent and accountable management of both donor and ECOWAS internal resources, through compliance with international standards’’. She also encouraged the ECOWAS Commission to integrate the activities of the RAO Support Unit within its structure.
CSOs called upon to promote the AU’s Free Movement Protocol (African Union)
African Civil Society Organizations (CSOs) have been urged to support and promote the implementation of the African Union’s Free Movement Protocol (FMP) and the Migration Policy Framework for Africa (MPFA). This clarion call to CSOs was made during the opening of the Regional CSO Sensitization Forum on the Continental Free Movement Protocol
The FMP and the MPFA have been established by the AU as the primary policy frameworks to address, manage, and promote migration and mobility on the continent. The FMP, in particular, aims to curb and eventually eliminate barriers to regional border migration (to work, visit, trade, live, etc.) within the continent. Eliminating these barriers translates to economic growth on the continent as well as improved migration procedures for African citizens. Unfortunately, despite the existence of these migration policy frameworks, policy uptake among AU Member States and their popularization within African civil society remains low and has not achieved the desired impact.
The United Nations Economic Commission for Africa’s (ECA) Ms. Edlam Yemeru has told the first International Migration Review Forum yesterday that using high-quality data is critical to fostering inter-regional cooperation on the implementation of the Global Compact for safe, orderly and regular Migration (GCM).
$100m facility aims to unlock African supply chain finance (IT-Online)
British International Investment (BII), the UK’s development finance institution (DFI) and impact investor, has signed a $100-million risk-sharing facility for supply chain finance with Citi, a global leader in trade and supply chain finance solutions. The new facility will provide systemic liquidity and help Citi grow its supply chain finance product across Africa.
The facility will be targeting SME suppliers and those underserved or excluded businesses. It will boost Citi’s annual supply chain finance volumes in Africa by up to $400-million, with amplified capital support that will enable businesses to better manage cash flow and onboard new suppliers to the supply chain, ensuring the continued flow of goods and services. This will help expand the scope of local businesses and ensure productive and inclusive economic opportunities for diverse groups and communities.
EAC partner states’ blue economy policy to bolster economic growth (IPPmedia)
EAST African Community (EAC) partner states are working to come up with a common blue economy strategy that will align all the key sectors to boost its contribution to the Gross Domestic Product (GDP). This follows a move by the African Union (AU) to prepare a draft strategy on the blue economy, a programme which is overseen by experts in the fisheries sub-sector who are meeting in Dar es Salaam to discuss and improve the document before coming up with a final copy.
They are also discussing how to improve awareness on the potential of the sub-sector in Africa, identify policy and knowledge gaps among Regional Economic Communities (RECs) as well as how partner states will implement the blue economy strategy.
Inception of New Data-Driven Program to Promote Food Systems Transformation (News Ghana)
CORAF and the International Food Policy Research Institute (IFPRI) launched the fifth phase of the Agricultural Science and Technology Indicators (ASTI) program; Funded by the United States Agency for International Development (USAID), the fifth iteration of the program will provide actionable data on agricultural research and development in the twenty-three (23) countries in West and Central Africa (WCA), covered by CORAF; Policymakers and other stakeholders are expected to base their decision-making on the data generated through the program, to foster food systems transformation in WCA. CORAF and the International Food Policy Research Institute (IFPRI) officially launched the fifth phase of the Agricultural Science and Technology Indicators (ASTI) program on May 12, 2022.
“The ASTI program aims to provide information to stakeholders and generate knowledge on the inputs, performance and outcomes of agricultural research and development systems in low and middle-income countries. It builds a solid foundation for long-term monitoring of agricultural research and development investments and capacities,” said Dr. Gert-Jan Stads, Senior Program Manager at IFPRI. The ASTI program is an initiative of IFPRI that was launched in 2001.
Remarks by Managing Director Kristalina Georgieva
The war in Ukraine is gravely impacting Africa—and vulnerable people will suffer the most. The main transmission channels are well-known:
Sharply higher food and fertilizer prices are putting significant pressure on households—especially the poorest, for whom food accounts for 40 percent of consumption. And this is exacerbating the significant food security challenges that many countries in the region already face. Higher fuel prices will boost the import bill for oil importers. And this will make an already delicate fiscal balancing act even more difficult.
Together, these shocks will worsen external and fiscal balances—already strained by the pandemic—across many African countries.
Our projections show that the impact of the war in Ukraine on food and fuel prices threatens progress made by African economies in recovering from the pandemic. We expect growth in sub-Saharan Africa’s to slow to 3.8 percent in 2022 from 4.5 percent last year.
We know hunger is the world’s greatest solvable problem. Africa has tremendous potential to be a part of the solution. This requires progress on reforms that could rapidly and sustainably boost food production, including wheat, rice, and other cereal crops. These reforms would significantly help African economies become more resilient to shocks, more peaceful, and more prosperous—our common goals.
Towards an integrated and climate-resilient Africa and a just energy transition (AfDB)
Of all continents, Africa is least responsible for climate change. It has contributed only a minute part of the Greenhouse gas emissions that are responsible for the climate emergency the world faces today. Yet, Africa faces the same arduous battle as the rest of the world to tackle the impacts of climate change, and to make itself resilient to climate change. Today, Africa remains one of the most vulnerable and the least climate-resilient regions in the world. This is manifest across all corners of the continent. In the Horn of Africa, millions are threatened as a historic drought looms. In the Sahel, climate change is fueling insecurity because of increasingly scarce resources. And Southern Africa is experiencing lethal rain and floods. Action has never been more urgent. These climate change-induced challenges cut across many countries and subregions of the continent. With improved regional integration and deeper regional cooperation, African countries could rally around collective climate adaptation solutions and accelerate a just energy transition. The regional approach would elevate the individual voices of countries and facilitate access to increased global climate finance.
Experts Call for Sustainable Regional Energy Market (COMESA)
The regional energy market has immense potential in strengthening and deepening regional integration but for many COMESA countries, the generation capacity is not enough to cover the nations own needs and allow for cross-border trade. According to the Chairperson of the Regional Association of Energy Regulators for Eastern and Southern Africa (RAERESA) Mr. Daniel Bargoria, plans are underway to improve the transmission capacity across borders, but the same is not enough to secure unimpeded trade across the countries and regions. He said better energy infrastructure facilitates relations between countries, stimulating integration of the productive sectors as it brings close together economic spaces, reduces and/or eliminates the physical barriers to trade and transport costs and expands the market size.
In his statement, COMESA Assistant Secretary General for Programmes, Dr Kipyego Cheluget observed that trade in energy was as critical and beneficial as trade in goods and other services. “Energy trade allows all nations to benefit from their comparative and competitive advantages and from the advantages of the economies of scale and scope,” he said. “The power sector should be open for the private sector investment and ownership.”
Global economy news
TRIPS waiver: 30 members begin text-based talks, but differences remain (Economic Times)
Ahead of a key ministerial meeting of the World Trade Organisation (WTO) next month, 30 members of the agency, including India, have begun text-based negotiations to also cover diagnostics and therapeutics in a decision that seeks to waive patents on Covid-19 vaccines. The Trade-Related aspects of Intellectual Property Rights (TRIPS) Council met informally on Thursday to take stock of the talks on a proposal floated by India, South Africa, the US and EU to waive patents on Covid-19 vaccines.
According to a Geneva-based official, differences remained among delegations on the first two days of the talks, with the EU insisting that there is a “delicate balance in the text which should not be upset” in the current outcome document on vaccine patent waiver, while the African Group emphasised on diversified production not only of vaccines but also of therapeutics and diagnostics for at least five years.
Thinking About Current Views on Trade (American Enterprise Institute)
Globalization 2.0 Will Realign Trade and Make Things More Expensive (Bloomberg)
Over the past few years, the world has experienced an escalating series of trade disruptions — the US-China trade war, the Covid-19 pandemic, supply chain disruptions, Russia’s war with Ukraine, dueling sanctions and export controls. The cumulative effects of these crises are driving a deep rupture between free-market democracies and Chinese/Russian-style authoritarianism that’s dividing the global economy along geopolitical fault lines. “Fragmentation is going to stay,” says Bob Koopman, chief economist of the World Trade Organization, the Geneva-based institution formed 27 years ago to ensure nations abide by the rules of international commerce. ”What we’re going to see is this reorganized globalization.”
How digital multinationals are transforming global trade and investment (UNCTAD)
The international production footprint of digital multinational enterprises (MNEs), which was already expanding, has grown even faster during the COVID-19 pandemic. UNCTAD’s Global Investment Trends Monitor published on 27 April unveils new rankings of the top 100 digital MNEs, whose total sales were almost 160% higher in 2021 than in 2016, with an average increase of 21% per year. Their net income grew by over 60% between 2020 and 2021, in contrast to a flat trend for the traditional top 100 MNEs, excluding those in the technology sector. The top 100 digital MNEs include leading players such as Uber, Twitter and Meta. The report also looks at the impact of the world’s largest digital MNEs on trade and investment. “Digital MNEs can provide a boost to competitiveness across all sectors, new opportunities for business and entrepreneurial activity and new avenues for market access and participation in global value chains,” said James Zhan, UNCTAD’s director of investment and enterprise development.
Can blockchain offer solutions for cross-border trade and supply chain disruptions? (Kitco News)
As financial markets have taken a hit in recent weeks, cryptocurrencies have especially been under fire since their values appear to have devalued faster than traditional assets. In this context, some have dismissed cryptocurrencies as a speculative investment; however, the underlying blockchain technology upon which many of them are based should not be conflated with cryptocurrency and its perceived flaws. Worldwide, companies have experienced widespread sourcing disruptions since the start of the pandemic, and increasingly, actors along the supply chain are embracing blockchain and similar technologies in order to facilitate compliance, transparency, and efficiency in cross-border transactions and to alleviate some of the ongoing disruptions.
The technology can also help make trade less paper-intensive, as well as more compliant, inclusive, and socially responsible, thereby reducing costs. This is especially good for small businesses, which are disproportionately affected by red tape at the border, and for government agencies seeking to improve reliability and facilitate trade.
Members discuss potential outcome on cotton at MC12, World Cotton Day, Partners’ Conference (WTO)
At the WTO’s Cotton Days meetings on 11-12 May, the Cotton-4 (Benin, Burkina Faso, Chad and Mali) and other cotton-producing developing countries repeated the call for cotton trade reforms and an outcome on cotton at the 12th Ministerial Conference (MC12), scheduled for 12-15 June. WTO members were also updated on preparations for World Cotton Day 2022 and a Partners’ Conference in July. An information session shed light on supply chain disruptions and ways to build a more resilient cotton industry post-pandemic.
The G7 Development Ministers of Canada, France, the EU, Germany, Italy, Japan, the United Kingdom, and the United States of America convened in Berlin on May 19 under the theme “Response to Multiple Crises on the African Continent – focusing on Food Security”.
Participants reiterated their commitment to protecting open, inclusive, and rules-based international cooperation that leaves no one behind, and emphasized that a rules-based multilateral system is key to the solution of global challenges such as food insecurity and malnutrition, climate change and a just energy transition, land degradation and biodiversity loss.
The G7 Development Ministers and International Organisations called on their African partners to take full advantage of the African Continental Free Trade Agreement (AfCFTA) in order to increase food security and nutrition on the continent. Participants welcomed the upcoming meeting of African Ministers of Agriculture and Ministers of Finance on the African Emergency Food Production Plan organised by the African Union Commission and the AfDB. Participants furthermore welcomed the formation of the Coordination Group of the United Nations Economic Commission for Africa, Afreximbank, the African Union Commission and the AfCFTA, which aims at pooling procurement for food, fertilizers, and agricultural chemicals that will allow African economies access to items of first necessity at a lower cost.
Food insecurity threatens societies, exacerbates conflicts and ‘no country is immune’ (UN News)
Last year, most of the 140 million people suffering acute hunger around the world lived in just ten countries: Afghanistan, the Democratic Republic of the Congo (DRC), Ethiopia, Haiti, Nigeria, Pakistan, South Sudan, Sudan, Syria and Yemen – eight of which are on the Council’s agenda. “Let there be no doubt: when this Council debates conflict, you debate hunger. When you make decisions about peacekeeping and political missions, you make decisions about hunger. And when you fail to reach consensus, hungry people pay a high price,” Mr. Guterres spelled out. Though pleased to announce that the Central Emergency Response Fund is releasing $30 million to meet food security needs in Niger, Mali, Chad and Burkina Faso, he said sadly: “But it is a drop in the ocean”.
Chair’s Statement: Roadmap for Global Food Security – Call to Action (United States Mission to the United Nations)
We call on all United Nations Member States, international organizations, the private sector, and civil society and academia to urgently support the emergency response to address humanitarian needs and to also focus on building resilient and sustainable food systems particularly for those most vulnerable to food insecurity and malnutrition. We issue this Roadmap for Global Food Security–Call to Action to affirm our commitment to act with urgency, at scale, and in concert to respond to the urgent food security and nutrition needs of millions of people in vulnerable situations the world.
World Bank Announces Planned Actions for Global Food Crisis Response (World Bank)
The World Bank today announced actions it plans to take as part of a comprehensive, global response to the ongoing food security crisis, with up to $30 billion in existing and new projects in areas such as agriculture, nutrition, social protection, water and irrigation. This financing will include efforts to encourage food and fertilizer production, enhance food systems, facilitate greater trade, and support vulnerable households and producers. “Food price increases are having devastating effects on the poorest and most vulnerable,” said World Bank Group President David Malpass. “To inform and stabilize markets, it is critical that countries make clear statements now of future output increases in response to Russia’s invasion of Ukraine. Countries should make concerted efforts to increase the supply of energy and fertilizer, help farmers increase plantings and crop yields, and remove policies that block exports and imports, divert food to biofuel, or encourage unnecessary storage.”
The World Bank is working with countries on the preparation of $12 billion of new projects for the next 15 months to respond to the food security crisis.
Countries review progress on global migration compact (UN News)
Mr. Guterres was addressing the official opening of a meeting to review progress towards implementing the Global Compact for Safe, Orderly and Regular Migration, adopted by governments in 2018. The first International Migration Review Forum will also examine the interplay between migration and broader concerns, including the pandemic, conflict, development finance, and the climate emergency. “The COVID-19 pandemic has painfully demonstrated how far we still are from realizing rights-based, child-sensitive, and gender-responsive governance of international migration for all,” he said.
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Local news
SA Cangegrowers calls on government to honour Sugar Masterplan commitments (Engineering News)
When Minister Ebrahim Patel delivers the budget for the Department of Trade, Industry and Competition (DTIC) on May 20, industry organisation SA Canegrowers says it hopes he will use it as an opportunity to provide an update on government’s action to implement its commitments under the Sugarcane Value Chain Masterplan. This plan was developed to address a number of serious challenges facing the industry and to ensure its long-term sustainability and profitability.
Collaboration needed to make South African mining globally competitive again – CSIR (Engineering News)
Concern about mineral resource scarcity is widespread and, at the same time, many countries, such as Australia, Canada and China, are investing significantly in strengthening their mining-related research, development and innovation (RDI) capabilities. “This makes cost and differentiation competitiveness a challenge for South Africa,” states Council for Scientific and Industrial Research (CSIR) CEO Dr Thulani Dlamini in an Op-Ed to Mining Weekly, in which he emphasises that it will require all mining RDI stakeholders – Minerals Council South Africa, mining companies, mining equipment suppliers, government and research institutions – to have an integrated plan for South Africa’s mining industry to become globally competitive in niche areas.
Momentous occasion as Lesotho, US sign US$300 million Compact II (Lesotho Times)
Today all roads lead to ‘Manthabiseng Convention Centre for the official signing ceremony of a US$300 million (about M4, 8 billion) grant to Lesotho from the United States (US)’ Millennium Challenge Corporation (MCC). In a statement, the US embassy in Lesotho this week said MCC CEO Alice Albright will sign on behalf of the corporation while Foreign Affairs and International Relations Minister ‘Matšepo Ramakoae will sign on behalf of Lesotho.
The compact has three proposed projects — Market-Driven Irrigated Horticulture (MDIH), Business Environment and Technical Assistance (BETA), and the Health System Strengthening (HSS) project, and each project has several components. The Compact II signing is a huge relief to Lesotho which has endured a five-year wait for a definite funding agreement.
The big infrastructural projects revamping the coastal economy (The Standard)
Deputy Director Kenya National Highway Authority, Eng Kungu Ndungu explains the Dongo Kundu Special Economic Zone construction plan.
Mombasa Port is the region’s biggest handler of sea cargo, with two berths handling 1.5m twenty-foot equivalent unit (TEU) per year. This is expected to rise. Conceptualised over 40 years ago, the roads with the three largest bridges in the country will be complete and in use soon.
The Mombasa Port Area Road Development Project - carried out in what the contractors have classified as Three Packages - is expected to improve efficiency and thereby increase capacity at the port with the expected linkages to the Special Economic Zone besides opening up the inaccessible hinterland.
The Mombasa Port’s capacity as the gateway to the Northern Corridor is being expanded. JICA partnered with Kenya in the construction of berths cover 33 per cent of the container cargo handling capacity of the country, which is expected to rise to 47 per cent once Phase 2 is completed.
“If Mombasa Port does not expand, it becomes a feeder port. That means other ports will receive the large ships and it can only get cargo from them. The double handling will be very expensive,” he said. The cost of maintaining containers stuck at sea due to slow processing will also be eliminated. Right across the port, on 3,000 acres of land, the Dongo Kundu Special Economic Zone is taking shape.
China’s Belt and Road Initiative in Kenya (Foreign Policy Research Institute)
Through trade, investment, and strategic diplomacy, China is re-shaping sub-Saharan Africa. Beijing has growing economic ties with Africa’s largest economies and Chinese firms dominate infrastructure construction projects. In 2020, nearly one-third of infrastructure projects in Africa worth at least $50 million were built by Chinese companies. In addition, China is, in many areas, replacing the United States and Europe as trade partners with Africa. Beijing has translated China’s growing economic footprint in Africa into geopolitical influence.
Some Western commentators have observed China’s growing economic footprint in Africa — especially its Belt and Road Initiative (BRI)—with skepticism and concern. They argue that Chinese investments are debt traps that will eventually lead to neo-colonialism. Despite this criticism, China’s influence on the continent continues to rise.
Is it true that Chinese infrastructure projects malicious are debt traps? Or is the BRI merely an extension of a partnership where China supports the economic development of African countries? Or is it some combination of both? While African elites
Kenya and Uganda agree on fuel supplies (Business Daily)
Uganda has struck a deal with Kenya, its main route for petroleum imports, after talks by officials from the two neighbouring countries in Nairobi.Last month, Kampala had demanded fixed monthly transit petroleum product quotas to ease shortages amid anxiety over a fuel crisis.Energy Cabinet Secretary Monica Juma met with Uganda’s top energy officials led by her counterpart Sidronious Okaasai.”We reaffirmed Kenya’s commitment, as the gateway, to service the fuel needs of the region and discussed ways of enhancing cooperation through joint and complementary projects that accelerate regional integration,” said Dr Juma in an update.
“We are hopeful that some of these action areas could enable us to address petroleum product supply problems in Uganda,” Ugandan Permanent Secretary Irene Batebe had said last month in a letter to her counterpart in Kenya, Andrew Kamau. Both Ms Batebe and Mr Kamau attended the talks.
Why Uganda’s critical minerals industry is important (The Observer)
Uganda is one of the many countries in the Great Lakes region that have committed to the Paris Agreement and the need to address the mineral intensive clean energy technologies for a transition to a 1.5oC - 2oC by 2050.
Recent developments in the mineral sector place Uganda at the centre of the energy revolution, both for its energy security needs, but also as a key player in shaping regional initiatives and the control of the international supply chains of critical minerals. These developments call for a regional collaborative solution as opposed to a one-state solution such as the presidential ban on the export of unprocessed raw materials imposed in 2011 by the Ugandan government. The critical minerals industry requires a special Afro-centric policy, fiscal and regulatory framework modelled on the East African Community vision, African Union Agenda 2063 and the Africa Mining Vision.
Domestic regulation and development of these resources must be data-driven to establish their commerciality, mine life, access to finance to establish the desired technology in Uganda and specific commodity feasibility studies to establish availability of regional sustainable supply of raw materials to sustain value addition initiatives within the East African Community and the Great Lakes region.
Rwanda pumps $150m to private sector for post-Covid recovery (The East African)
Rwanda has unveiled an additional $150 million in funding for businesses to stimulate growth and mitigate the prolonged impact of the coronavirus pandemic on the economy. The funds, drawn from its $250 million Economic Recovery Fund launched in June 2021, have been earmarked for the private sector, specifically manufacturing. This is set to boost production locally as the country seeks to contain rising prices and reduce imported inflation.
“The current global inflation is heavily impacting our economy…the government has invested in subsidies and attracted investors in the manufacturing sector to boost local production to reduce our dependence on imports,” Prime Minister Edouard Ngirente said. The government will also continue to add subsidies to essential commodities such as fuel to ease the burden of hiking prices. Rwanda heavily depends on imports with a trade deficit of $216.43 million in 2021, according to the National Statistics of Rwanda.
‘Our poultry industry could suffer greater shocks from fertilizer shortages’ – Akufo-Addo (GhanaWeb)
Growing concerns about the unavailability of fertilizer for agriculture production have contributed to the surge in the prices of food in Ghana and the continent. The poultry industry has also bemoaned the unavailability of feed and raw materials. President Nana Addo Dankwa Akufo-Addo has stated that these concerns could heighten as fertilizer shortages are being experienced across Africa. According to the President, the country’s maize and soy production could be affected noting that “our poultry industry could suffer greater shocks.”
Leveraging Locally Produced Goods for FX Accretion (This Day)
While Nigerians grumble over the increase in exchange rates, Ayodeji Ake presents the advocacy of business experts on patronage of locally produced goods to address import dependency putting an end to escalating issues of low foreign exchange Over the years, the Central Bank of Nigeria (CBN) has urged Nigerians to embrace homemade products to boost Nigeria’s economy and to save Naira from continuous depreciation in the parallel market. According to reported statistics, Nigeria’s capital inflows plummeted to a four-year low of $9.66 billion in 2020, sloped to $6.7 billion in 2021. Nigeria’s international trade balance for 2021 hit a deficit of N1.94 trillion, the largest on record. Nigeria’s exports climbed 51 per cent to N18.91 trillion in 2021, up from N12.52 trillion of the year before. However, the increase in export proceeds was not enough to offset the 64.1 per cent increase in import bills, which totalled N20.84 trillion.
As a result of the FX Outflows, a $5.26 billion negative balance of payment was made in 2021, putting even more pressure on the local currency and necessitating the use of the external reserve.
Highlights of Key Developments in Nigeria’s Maritime Industry in 2021 (JD Supra)
Despite disruptions caused by the Covid-19 pandemic, resulting to changes in global trade patterns and a supply chain crisis, Nigeria’s maritime industry made some gains in the year 2021. Compared to the year 2020 which saw a downtime in global trade, the year 2021 marked a rebound in commercial shipping activities around the globe with Nigeria receiving its fair share of value. According to the Maritime Transport Review 2021 – a flagship report published annually by the United Nations Conference on Trade and Development (UNCTAD) – Nigeria ranked highest among the top 35 flags of registration in terms of increase in its share of the world merchant fleet value which moved from 0.50 to 0.78 per cent1 . Nevertheless, the year 2021 was not without challenges. Besides the pandemic, the industry was severely constrained by rising exchange rate coupled with Dollar scarcity, incessant increase in Customs duty and policy inconsistency on the part of government. This paper highlights key developments that took center stage in the industry in the year under review.
Food Production: ActionAid tasks govt on 10% annual budgetary allocation to agriculture (Vanguard)
A non-profit making international organization, ActionAid Nigeria, AAN, Wednesday, tasked government at all levels on ensuring 10 per cent budgetary allocation to agriculture in order to boost food production in Nigeria. This was stated by the Country Director, AAN, Ene Obi, in an address of welcome at the ‘National Dialogue & Dissemination on Nigeria’s Performance at 3rd Biennial Review Exercise on the Implementation of the Comprehensive Africa Agriculture Development (CAADP)’.
Obi pointed that after the Malabo Declaration for 10 per cent of budgetary allocation to be for the agricultural sector across Africa, the Nigerian government’s budgetary allocation for the sector has not been encouraging, because it has remained between three and five per cent.
FG Urged to Create Basic Data Infrastructure to Attract Foreign Investments (This Day)
The Chief Operating Officer of MDXI, MainOne’s Data Centre business, Mr. Gbenga Adegbiji, has called on the federal government to revisit its policies and create basic infrastructure for data centre operations across Nigeria, in order to attract foreign investments in the Information and Communications Technology (ICT) sector. Adegbiji who gave the advice during an interview with THISDAY, said: “Investors do not invest based on what any government tells them, but they invest based on what the see, which has to do with growth indices and numbers. They look at the population report and the growth of the economy, including security of investments in the country, before they can invest in the country. “Attracting foreign investments, goes beyond what the Nigerian government is currently doing by mere visiting these investors in their countries to woo them to invest in Nigeria. They will surely come and invest if they see the need to invest in Nigeria, and a good example is the recent acquisition of MainOne by Equinix because MainOne has over the years, positioned its operations to a standard that is attractive to any foreign investor. Investments are made based on numbers, foreseeable return on investments, and risk that is associated with a particular country.”
Sanwo-Olu, Others Call for Increase in Investment to Bridge Nigeria’s $11trn Infrastructure Gap (This Dau)
For Nigeria to close the infrastructure gap in the critical sectors of the economy, about $11 trillion would be required, the Association for Consulting Engineering in Nigeria (ACEN), has revealed. To this end, the Lagos State Governor, Babajide Sanwo-Olu, professional engineers, experts and other stakeholders have advocated increased investment in the provision of infrastructure to foster real growth and economic prosperity on the continent. Sanwo-Olu alongside the professional engineers and experts, spoke at the opening of the 28th Annual FIDIC Africa Infrastructure Conference held on Monday in Lagos, with the theme, ‘Infrastructure Development in Africa’.
They called on governments across Africa to give attention to the provision of critical socio-economic infrastructure that could catalyse growth in the Gross Domestic Product (GDP) and stimulate prosperity.
South Sudan set to receive ‘cheap electricity’ from Ethiopia (The New Arab)
Ethiopia has agreed to send 500 megawatts of electricity, some of which will be sourced from its controversial Grand Renaissance Dam, to South Sudan over the next six years. The Grand Ethiopian Renaissance Dam (GERD) has caused long-standing disputes between Ethiopia, Egypt and Sudan over water rights [Getty] South Sudan will receive 500 megawatts of electricity from Ethiopia over the next six years following the construction of the controversial Grand Ethiopian Renaissance Dam (GERD), according to reports.
“[Ethiopia is] aggressively working to supply electric power to its neighbours as part of regional integration,” said the chief of Ethiopian Electric Power, Anadualem Siaa, to the country’s state media.
Ethiopia also has agreements to sell electricity to Kenya and Tanzania. There are plans to supply power to Rwanda, the Somaliland region of Somalia, and Burundi.
African trade news
AfCFTA is a start, but private sector empowerment is needed to unlock full free trade benefits (The Africa Report)
At a time when global transport and logistics systems are being disrupted and trade wars are raging, relying on the rest of the world for essentials has proven to be a risky bet. Africa learned this the hard way during the Covid-19 pandemic, with just 11% of Africans being fully inoculated against the virus due to inequitable vaccine distribution. The world is realising this again with the war in Ukraine and its impact on the price of oil and food security. Removing barriers to cross-border trade and championing the creation of regional manufacturing hubs that can produce vaccines and other essential goods is an urgent priority for Africa, and important progress is already being made across the continent.
Private sector investors are joining forces with development partners to promote vaccine manufacturing in Africa, for Africa.
In the last two decades, intra-African trade not only increased in volume but also in quality. Goods traded within Africa are more diverse and of higher value addition than those traded with the rest of the world.
2022 WTPO Conference: AfCFTA eyes continent’s $450 million untapped SME market (Myjoyonline)
The 13th World Trade Promotion Organizations Conference has opened in Accra with a high panelled forum which is focused on leveraging the economic potential of Small and Medium Enterprises (SMEs) for inclusive growth. Speaking at the Conference in Accra, Secretary General of the Continental Free Trade Agreement Area, Wamkele Mene, announced that the secretariat is shifting its focus from large industries to SMEs to ensure inclusive and sustainable economic growth through a signed Memorandum of Understanding (MoU) with the International Trade Corporation (ITC). It comes as Ghana and the rest of Africa risk losing an annual Gross Domestic Product (GDO) of $450 million if struggling SMES and social impact entrepreneurs are not cushioned from the economic impact of COVID-19, climate change and the war on Ukraine.
“It is vital that under the current circumstances, the SMEs are supported to survive and adapt, as they can be a key component on the road to economic recovery on the continent. Indeed, TPOs will be vital in providing assistance to SMEs to ramp up their export capabilities. In addition, it is crucial that you support them to understand and participate in regional value chains, for our “Made in Africa” revolution to be successful,” he stated.
Alan urges developing countries to prioritise trade in national development agenda (GhanaWeb)
Multi-modal transport network key to AfCFTA success – Dep. Minister (GhanaWeb)
Speaking on behalf of the Minister of Transport Kwaku Ofori Asiamah at the opening ceremony of the Chartered Institute of Logistics and Transport (CILT) Africa Forum held in Accra, the Deputy Minister said transport would play a key role in linking activities within the continent and beyond.
“On our part as policymakers, we remain committed to the facilitation of cargo and passengers across our borders and to other African countries through the development and enhancement of ground and air transport infrastructure. From airports, seaports and cargo terminals to maritime and air space management. In terms of infrastructure we have embarked on massive infrastructure development to improve all of our seaports and airports as well as railway connectivity.”
The Deputy Minister of Trade and Industry, Herbert Krapah also supported the call for improved multimodal transport network in order to meet the continent’s integration objectives.
Digitalisation of Africa’s smaller airports vital for economic recovery (BusinessLIVE)
As we emerge from the Covid-19 pandemic and demand for air transport starts to normalise, airports are among the first to feel the impact of the harm caused by the pandemic. However, this latest struggle holds important lessons and solutions for African airports.
The industry’s recovery in Africa has already been deferred a year thanks to the triple-whammy of the initially slow and still low vaccination rates, the discovery of the Omicron variant, and more recently the surge in fuel prices as a result of Russia’s invasion of Ukraine. There is a silver lining in that it gives Africa’s airports some time to acquire the capacity, systems and solutions to manage the recovery and future growth.
The solution is for all airports — from mega-hubs to small municipal and regional facilities — to digitalise and automate time-costly processes like passenger processing and baggage handling. Agile cloud technology platforms that are efficient, flexible and scalable to fluctuating passenger volumes can help alleviate the pressure. By empowering passengers to use their mobile phones as a remote control for travel, we can reduce bottlenecks and offer a more seamless passenger journey.
Deepen trade within Africa – Akufo-Addo challenges business leaders (Graphic Online)
President Nana Addo Dankwa Akufo-Addo has made a clarion call to African countries to increase trade within the continent for them to stand on their own feet. That, he said, was in view of the current derangement of the global commodities market, supply chains and logistics occasioned by the Russia-Ukraine crisis which had culminated in fertiliser shortages around the globe. He said the situation could affect maize and soya production in African countries, including Ghana, and had “greater shocks” in Ghana’s poultry industry. President Akufo-Addo made the call when he opened the 22nd Academy of African Business and Development Conference at the University of Professional Studies, Accra (UPSA) yesterday.
Ukraine war: A wake-up call for Africa to increase inter-continental trade (The Africa Report)
Over the past couple of months, Russia’s invasion of Ukraine has severely disrupted the supply of essential crops to Africa and led to significant price increases for agricultural goods and energy, with prices skyrocketing across the globe.
Most of Russia’s imports to Africa are agricultural goods, with 90% of these agricultural goods being made up of wheat and 6% from sunflower oil in 2020. Similarly, 48% of Ukraine’s agricultural exports to Africa were made up of wheat and 31% of maize.
Could Africa fill the global commodities gap? (Energy Capital & Power)
Forecasts suggest that the global economy is facing a ‘commodity gap’ in the near future as the demand for battery minerals could outstrip supply; could Africa be the continent to fill that gap? There is certainly good reason to see Africa making a valuable contribution to future supplies of mined commodities from lithium, cobalt, nickel and graphite to manganese, iron, copper, chrome, uranium and aluminum, according to SRK director and principal consultant Andrew van Zyl.
While there are considerable resources of these minerals available in Africa and even currently being mined, there remain challenges which prevent their economic extraction. “One of the reasons why the gold sector thrives in many parts of Africa, for example, is because it needs relatively little in the way of national or state-managed infrastructure,” said Van Zyl. “For better or worse, a gold mine can operate quite effectively as an ‘island’ of activity and prosperity – providing most of its own inputs to mine and process ore, and to transport the very compact end-product.”
The Manufacturing Indaba 2022 addresses the need for business to swiftly adapt and remain competitive in a post pandemic era (Pumps Africa Online Journal)
The Manufacturing Indaba Conference will discuss key issues critical to supporting the development of manufacturers. The conversation will take place at the upcoming Manufacturing Indaba taking place from the 21st to 22nd June 2022 at the Sandton Convention Centre, Johannesburg, South Africa. The conference aims to focus on the financing and economic recovery of businesses in the manufacturing industry in a post pandemic era. The event will provide information to support, revitalise and aid manufacturing growth and recovery.
Time to reduce dependence on foreign aid – Akufo-Addo (Ghana Business News)
President Nana Addo Dankwa Akufo-Addo Wednesday called on African researchers and policy makers to scale up policies that would reduce the Continent’s dependence on foreign aid. They should pursue a path of self-respect and take actionable steps to create the enabling environment to build prosperity and development to make Africa rich and resilient. “The time to pursue a path of prosperity and self-respect for the African Continent is now,” he said at the opening of the 22nd Academy of African Business and Development (AABD) Conference, at the University of Professional Studies, Accra.
President Akufo-Addo said the concept of “Africa beyond Aid” was about acknowledging development in a sustainable manner, ‘taking the bull by the horns’, and take responsibility for sustainable growth while perceiving fellow African countries as key stakeholders in development.
Africa demands ‘fair international finance architecture’ (The New Times)
Calls for an international finance architecture which is fair grew on Monday, May 16, in Dakar, Senegal. The call was led by President Macky Sall at the annual Conference of African Ministers of Finance, Planning and Economic Development, ECA’s largest annual event where participants debate key issues concerning the continent’s development. It also discusses the think tank’s performance in delivering on its mandate.
Sall noted that given prevailing conditions, the parameters that allow global economic governance are outdated and unsuited to reality. Besides the devastating impact of the Covid-19 pandemic, Africa is confronting a new food, fuel and fertilizer crisis reverberating across the world as the Russia-Ukraine war creates global trade and commodity disruptions. Food prices are reported to be 34 per cent higher than this time last year. Crude oil prices increased by around 60 per cent while gas and fertiliser prices more than doubled. African economies are in a state of general fatigue, Sall said.
“The least we can say is that our economies are in a state of general fatigue, the extent and duration of which, unfortunately, we are yet to measure. And that is a problem,” President Sall said.
Global lenders want a piece of East Africa’s retail banking market (The East African)
East Africa is becoming fertile hunting ground for foreign banks seeking to explore the booming retail market that has seen KCB and Equity banks assets rise to over Ksh1 trillion ($8.62 billion) each, buoyed by expanding customer numbers and loan books.
global players are eyeing the regional banking market, with Nigeria’s Access Bank Plc and Egyptian Commercial International Bank (CIB) acquiring Kenyan lenders as launching pads into the seven-member bloc comprising Kenya, Uganda, Tanzania, Burundi, Uganda, South Sudan and the Democratic Republic of Congo. “The banking model has shown that there is a merit to good expansion. If you are able to expand and grow your balance sheet then you are also able to increase your profitability and East Africa is where the next growth frontier is considered to be,” said Paul Mwai, the Chief Executive of AIB-AXIS Capital Ltd and vice chairman of the Nairobi Securities Exchange (NSE).
A survey conducted by consultancy firm PricewaterhouseCoopers (PwC) in 2019 showed that global lenders were expressing interest in the East African market as local banks become more competitive regionally with their mobile money solutions, agency models and digital platforms that appeal to East Africans.
EA ports expect more ships after drop in piracy cases in Indian Ocean waters (The East African)
More ships are expected to make calls at East African ports following a drop in maritime crime targeting shipping lines over the past 20 years. Cargo ships destined for Mombasa, Dar es Salaam, Jeddah and the port of Djibouti have previously had to use circuitous routes to avoid being attacked in the Indian Ocean. Others have had to pay higher insurance premiums or hire security escorts, which in turn made importation costly for the local consumer. Now, the Allianz Global Corporate & Specialty SE (AGCS) “Safety & Shipping Review 2022” report indicates that maritime piracy in the Indian Ocean has almost disappeared.
Sub-Saharan Africa turns to Argentinian wheat (Argus Media)
Argentina is set to replace most of the lost Black Sea wheat supplies to countries in Sub-Saharan Africa in May. Importers in the region seek to replace shipments from Russia and Ukraine, which have fallen following Russia’s invasion of Ukraine on 24 February.
Argentinian wheat totalling 242,650t has been loaded, shipped or is awaiting shipment to Angola, Burundi, Cameroon, Cote d’Ivoire, Guinea, Kenya, Nigeria, Rwanda, Senegal, South Africa and Tanzania in May, according to preliminary line-up data.
The surge in shipments of Argentinian wheat to Sub-Saharan Africa comes as major importers around the globe scramble to secure supplies to replace lost shipments from Ukraine, which have collapsed following the Russian blockade of the country’s Azov and Black Sea ports. Ukraine’s grain exports, 90pc of which were traditionally handled by vessels leaving the country’s sea ports, fell by more than 70pc in April, compared with the same period in 2021. There have been attempts to move agricultural products over Ukraine’s western borders by truck and rail but logistical issues continue to plague operations and so exporting pace has slowed significantly in recent weeks.
Maize shortage ‘biggest issue in Africa’ (SciDev.net)
Maize prices soar as Sub-Saharan Africa production hit by climate change, global conflict and fertiliser shortages. Maize yields are expected to be drastically lower this season than in previous years in drought-hit Sub-Saharan Africa. While the drop will affect the entire region, Kenya is facing the biggest struggle as one of the region’s largest importers of the staple food.
Mid-sized cities key to Africa’s economic development concludes a regional gathering (UNECA)
Local and national governments convening at the 9th Africities gathering in Kisumu from 17 to 21 May 2022 concluded that mid-sized cities spread the benefits of access to cities to a large and dispersed rural population in Africa, while offering critical advantages for agricultural transformation. During the gathering – the largest meeting of local governments in Africa, the United Nations Economic Commission for Africa in partnership with UN-Habitat convened a specific session to examine the role of intermediate – or midsized – cities in Africa’s economic development and actions needed to unleash their untapped potential.
US seeks African partnerships on climate change, health (The East African)
The US is seeking to create more “mutually beneficial” partnerships with African countries in addressing climate change, health and economic growth, US Under Secretary of State for Economic Growth, Energy and Environment Jose Fernandez has said. Mr Fernandez was speaking to African journalists on May 11 from Cape Town, where he gave a keynote address at the Mining Indaba, an investment conference dedicated to the capitalisation and development of mining in Africa.
“My message both here and in Zambia is that Africa is key to achieving some of the most important priorities of the Biden administration,” Mr Fernandez said, adding that the US government is ready to partner with African countries and private American firms to invest in key priority areas.
Dawn of a second Cold War and the ‘scramble for Africa’ (Brookings)
Ample empirical evidence shows that the African Continental Free Trade Area (AfCFTA) will boost the competitiveness of African economies and accelerate the diversification of sources of growth and trade to deepen economic integration in Africa and enhance the region’s assimilation into the world economy. However, realizing these potentials hinges on reversing the current trend of rising insecurity heightened by proxy wars in the new age of great power rivalries. This paper outlines policy options that draw on the political and trade economies of scale to optimize the allocation of scarce resources and strengthen the security and development nexus to implement the AfCFTA successfully for lasting peace and prosperity in Africa.
Global economy news
Members discuss e-commerce, trade concerns and LDCs’ participation in services trade (WTO)
The WTO LDC Group highlighted that implementation of the services waiver was one of the priorities for the 12th Ministerial Conference (MC12) identified by LDC trade ministers in a declaration issued in October 2021. The LDC Group called for members’ continued support on this issue, with a view to reaching agreement on improving the implementation of the waiver at MC12, which will take place from 12 to 15 June.
A total of 51 members have notified preferences for LDC services and service suppliers under the waiver, with the aim of boosting LDCs’ participation in world services trade. The waiver was formalized by a decision adopted at the 2011 Ministerial Conference.
Dispute Settlement at the WTO: How Did We Get Here and What’s Next for the Commonwealth States? (The Commonwealth Secretariat)
This issue of Trade Hot Topics examines the current state of WTO dispute settlement with a focus on repercussions for Commonwealth countries. Specifically, it begins by outlining the dispute settlement profile of Commonwealth states, and then turns briefly to the history of the Appellate Body, highlighting its successes and the criticisms it attracted, as well as the reasons for its demise. This is followed by a discussion of the technicalities of one proposed option to temporarily fill the void left by the Appellate Body’s absence, assessing its merits and explaining what it might portend for participating and non-participating members. It concludes with recommendations for the consideration of Commonwealth states as they seek to define and promote their dispute settlement interests in the current WTO environment.
Members review notification activity on national customs legislation (WTO)
The Chair of the Committee, Buddhi Prasad Upadhyaya of Nepal, shared with members the current notification status regarding customs valuation legislation. Members welcomed the Chair’s proposal to organize an experience-sharing session in the margins of one of the upcoming Committee meetings to exchange experiences regarding the implementation of the Customs Valuation Agreement.
The WTO Secretariat made a presentation on how the e-Agenda platform has been implemented in the Committee on Market Access (CMA). While acknowledging that some aspects of the CMA’s activities differ from that of the Committee on Customs Valuation, the Chair encouraged members to consider whether certain aspects of the platform relating to transparency and accessibility of documents could be useful in their work.
Fragile economic recovery from COVID-19 pandemic upended by war in Ukraine | United Nations (UN DESA)
The war in Ukraine has upended the fragile economic recovery from the pandemic, triggering a devastating humanitarian crisis in Europe, increasing food and commodity prices and globally exacerbating inflationary pressures, says the latest United Nations forecast released yesterday.
World Economic Situation and Prospects as of mid-2022
Global growth prospects have weakened significantly amid the war in Ukraine, rising energy, food and commodity prices, soaring inflation and tightening monetary policy stances by major central banks. The world economy is projected to grow by 3.1 per cent in 2022, marking a downward revision of 0.9 percentage points from our previous forecast released in January 2022 .
US, UK, and EU Transatlantic Trade Review Developments (The National Law Review)
The United States (US) and United Kingdom (UK) continued to impose sanctions against Russia over the first two weeks of May, while the European Union (EU) continued its debate over another sanctions package. The US Congress also continues to debate a new $40 billion assistance package for Ukraine. The UK introduced legislation that would bring the free trade agreements with Australia and New Zealand into force later this year. The European Parliament approved its negotiating stance on the proposal for Foreign Subsidies. Meanwhile, the second US-EU Trade and Technology Council (TTC) ministerial meeting concluded on 16 May in Paris-Saclay, France
Study shows COVID-19 effects on trade in biodiversity products (UNCTAD)
The impact of COVID-19 on trade in biodiversity-based products, such as coffee, cosmetics and honey, has been both positive and negative, according to an UNCTAD study published on 3 May. The study based on a survey of more than 300 biodiversity stakeholders, shows that the pandemic’s effects have varied greatly across regions, countries and sectors. Positive impacts from the pandemic were reported by a higher share of respondents from the private sector supporting or implementing UNCTAD’s BioTrade Principles and Criteria. BioTrade is when a product or service sourced from biodiversity is commercialized and traded in a way that respects people and nature. It can be a positive force to protect biodiversity. About 73% of the survey’s respondents said they support or implement BioTrade principles.
The study found that COVID-19 has “created challenges for the collection, production, processing, distribution, commercialization, certification, support and study of biodiversity-based products and services.”
This is how to counter the global digital divide (WEF)
Countering the global digital divide is an increasingly urgent imperative because several essential aspects of everyday life – including banking, health care, education, media, communications and even identity – depend on access to digital tools and technologies. Connectivity has become a conduit to information, communication, education and societal wellbeing. People who lack opportunities to go online and engage purposefully with the digital economy face a worsening cycle of disenfranchisement.
Unfortunately, that’s a lot of people. Despite some improvement in recent years, a third of the world’s population (some 2.9 billion people) suffers from the digital divide – even though 95% of the world’s population resides within range of a mobile broadband network.
Carbon pricing proposals redrawn to account for developing economies (TradeWinds)
The allocation of part of the proceeds of market-based measures (MBM) to developing nations is becoming a critical part of the International Maritime Organization’s negotiations on a carbon pricing scheme. The latest proposal which is to be debated at the IMO’s June meeting is from Japan and includes the option of allocating funds for least developed countries (LDCs) and small island developing states (SIDs).
‘Lifeline’ of renewable energy can steer world out of climate crisis: UN chief (UN News)
Greenhouse gas concentrations Levels reached a new global high in 2020 and continued to increase in 2021, with the concentration of carbon dioxide reaching 413.2 parts per million globally, a 149% increase on pre-industrial levels. “We have broken records in main greenhouse gases, carbon dioxide, methane and nitrous oxide and especially the record in carbon dioxide is striking; we haven’t seen any improvement despite of the lockdowns caused by COVID in 2020, so the concentrations continue growing”, explains WMO chief Petteri Taalas.
Declaration of the 7th Meeting of OACPS Ministers of Fisheries and Aquaculture (ACP)
High-level fisheries and aquaculture policymakers from the Member States of the Organisation of African, Caribbean and Pacific States (OACPS), as well as leading fisheries professionals and practitioners met in Accra, Ghana for the 7th Meeting of OACPS Ministers in charge of Fisheries and Aquaculture from 5-8 April 2022. Themed, “OACPS’s Blue Economy Agenda 2030 – Catalysing Sustainable Fisheries and Aquaculture Development for the Future”, the meeting was hosted by the Ministry of Fisheries and Aquaculture Development, Ghana. In his closing remarks at the Meeting, Secretary-General of the OACPS, mentioning the challenges facing the sustainable development of the fisheries and aquaculture sector as a result of fisheries governance challenges and human-induced challenges and pressures such as climate change, overfishing, pollution and environmental degradation, nevertheless applauded the considerable efforts by the Senior Officials and the Ministers at the 7th Session, resulting, most notably in the Declaration produced at the end of the Meeting.
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SA still an investment destination of choice (SAnews)
The NDP may not be perfect, but it continues to be a guide in our vision to tackle poverty, inequality and unemployment, writes Phumla Williams. Under the stewardship of President Cyril Ramaphosa, his R1.2 trillion investment drive announced four years ago has reached an impressive 95% of this ambitious target. Both domestic and foreign investors continue to see SA as an investment destination. Numbers do not lie.
From the first SA Investment Conference in 2018 to the fourth earlier in 2022, the country has attracted over R1.14 trillion in commitments across a wide range of economic sectors. These investments are deliberate and calculated decisions by investors. They continue to view SA as a potential investment destination. The incoming investors display a strong vote of confidence in our ability to overcome our most pressing challenges, some of which are linked to the legacy of apartheid.
When engaging with potential investors the government has never extenuated the existing socioeconomic and political problems affecting the country. It openly and unstintingly acknowledges that it is gradually emerging out of a very difficult period where policy missteps and the unfortunate ruinous effects of state capture have retarded its progress. The ambitious investment efforts are emboldened by the high-profile political mandate, led by President Ramaphosa and his executive, to unequivocally build investor confidence and create a business-friendly environment. The President continues to lead this drive with honesty and keeping to his word in navigating through these challenges towards growing the economy and creating the much-needed jobs. As an economic hub and gateway for potential investors and tourists SA has unveiled the Economic Reconstruction and Recovery Plan (ERRP) to mitigate the socioeconomic setbacks that were aggravated by the COVID-19 pandemic.
Minister Patel Plans to make Export Promotion a Priority in all Work Streams of the dtic (the dtic)
The Minister of Trade, Industry and Competition, Mr Ebrahim Patel, says he wants to prioritise export promotion in all work streams of his department. He was addressing the virtual launch of the Black Industrialists Export Network. The network is aimed at strengthening efforts to boost the expansion of export markets for local businesses. This in turn is hoped will enable Black Industrialists to succeed in complex markets, and make it easier for them to access export finance, marketing avenues, and a flexible basket of advice and support suited to their unique needs. This initial meeting provided an opportunity to share ideas in respect of working together with black industrialists to facilitate entry of their products and services into export markets, highlight opportunities and challenges that they might be experiencing, as well as consider proposals on the workings and offerings of the export network.
He explained that exports provide the opportunity for industrialists to expand their markets beyond the South African market and there is therefore a need to expand the scope, through a focused export effort.
“The reality is that export markets are tougher than the South African market for business operators. That means that the effort that firms working with government put in should be quite considerable. It is important for us to succeed at this because export can help us achieve wider goals of economic growth and job creation. The Black Industrialists Export Network will combine efforts to break into new markets. This should give local black businesses scale,” he said.
Forum established to support informal economy (Engineering News)
The Informal Economy Development Forum (IEDF) is a new body that has been set up to drive growth within the sector, support informal economy workers and function as the conduit between government, corporate South Africa and the informal economy. The IEDF’s key objectives are to improve the business, labour and regulatory environment in which informal businesses operate, ensuring equitable access to skills development and training, finance and the removal and simplification of regulatory requirements that prohibit growth to benefit South Africa’s 5.2-million informal workers.
President Cyril Ramaphosa: Meeting with Durban Chamber of Commerce and Industry (South African Government)
The economic reconstruction and recovery underway across the country in the aftermath of the COVID-19 pandemic cannot succeed without the swift, comprehensive and sustainable recovery of the economy of KwaZulu-Natal. Declaring the floods as a national state of disaster has enabled us to mobilise more resources, capabilities and technical expertise within the necessarily timeframes.
Damage to key economic infrastructure such as roads, energy transmission and distribution, water and sanitation facilities and the port of Durban has had – and continues to have – a dire impact on your operations. Sectors that power the provincial economy such as manufacturing, FMCG, retail and wholesale, distribution, warehousing and freight have been particularly hard hit by these floods. Given the importance of the Port of Durban to the national and continental economy, restoring operations and rehabilitating damaged port and associated infrastructure has been a priority.
Twinning project to boost Namibia’s international trade (New Era)
Minister of Industrialisation and Trade Lucia Ipumbu on Friday officially launched the European Union (EU) funded twinning project, titled ’Providing support to the Namibia Standard Institution (NSI)’.The two-year twinning project aims to boost NSI’s capacity to carry out its mandate and extend Namibia’s involvement in international trade. The project is part of the Economic Partnership Agreement (EPA) Implementation Plan for Namibia, and it is supported to the tune of €1.6 million (N$27 million). This is the first EU twinning project in Sub-Saharan Africa, jointly implemented by a consortium of eight German and Swedish institutes with experience in trade policy, technical regulation, food safety, standardisation, accreditation, metrology and conformity assessment.
The NSI and the trade ministry are the project’s primary beneficiaries. Speaking at the occasion, the EU ambassador to Namibia Sinikka Antila narrated how “twinning” is a special concept by the EU to enhance institutional collaboration between public administrations, its member states, as well as beneficiary or partner nations. Through peer-to-peer operations, twinning programmes combine the public sector expertise of EU member states and recipient countries to provide concrete, mandatory operational outcomes.
Government acts to bring down prices (Chronicle)
Government has suspended with immediate effect and for the next six months, import duty on basic commodities in a move meant to counter escalating and unjustified price increases of locally manufactured products. There has been unjustified increases in the prices of goods and services in recent weeks, mostly being pegged using forex black market rates as the benchmark. The parallel market activities have fuelled the depreciation of the local currency and inflationary pressures. In June last year inflation was at 50,1 percent, a record low in two years, but climbed to 96,4 in April from 74,6 percent in March amid the exchange rate volatility. To cushion consumers, rice, flour, cooking oil, margarine, salt, sugar, maize meal, milk powder, infant milk formula, Tea (whether or not flavoured), petroleum jelly, tooth paste, bath soap, laundry bar, and washing powder will now be imported duty free.
Moi airport upgrade lifts exporters of fresh produce (Business Daily)
The Sh7.5 billion infrastructural upgrade at Moi International Airport, Kenya’s second-largest airport has led to increased export of fresh produce. The upgrade included the cargo terminal, cold room replacement of the airfield, ground lighting systems, and approaching lighting masts with fiberglass from the traditional steel. Fresh Produce Consortium of Kenya (FPCK) Chief Executive Officer Okisegere Ojepat said the upgrading of the airport is a major boost to Kenya’s export of fresh produce to the international market. Kenya Plant Health Inspectorate Service (Kephis) Coast Regional Manager Thomas Kosiom said there has been a steady rise in exports of fresh produce ranging from chilies, French beans, flowers, avocados and pineapples through the international airport. Kephis is the government parastatal whose responsibility is to assure the quality of agricultural inputs and produce to prevent adverse impacts on the economy, the environment and human health.
Milk supply plunge sees prices rising steadily for weeks (Business Daily)
Formal milk intake has been on a steady decline between January and March, piling pressure on consumer prices at the shelf. Data from the Kenya Dairy Board (KDB) shows that the volume of the commodity supplied to processors declined to 61.7 million litres in March from a high of 69.3 million and 66.4 million litres in January and February respectively. The decline has led to a sharp shortage in the market, which has pushed the price of a half-litre packet to Sh60 and resulted in absence of long-life milk on the shelves as processors concentrate on first moving fresh brands. Processors have been operating at half of their installed capacity due to a shortage in supply from farmers across the country.
Customers, stakeholders delight at enhanced ports’ efficiency (Dailynews)
Major shipping companies and maritime sector’s key stakeholders are delighted with enhanced efficiency at Tanzania’s principal port of Dar es Salaam, which is a gateway for approximately 95 per cent of Tanzanian trade. The Tanzania Ports Authority (TPA) has massively strengthened operations in the country’s major sea gateway, which is also the access route to six land-linked countries including Malawi, Zambia, Burundi, Rwanda, Uganda, and the Democratic Republic of Congo (DRC), resulting in increased cargo traffic and revenues for the government. Speaking on various occasions, officials from shipping agencies and traders commended improvement of the port’s operations, efficiency and competitiveness, noting that the TPA has sufficiently been meeting the logistical needs of its clients. Looking to turn the country’s ports into a hub for regional waterway transportation, the Government of Tanzania has and continues to commit huge investments in infrastructure, equipment, technology and expertise.
Petrol scarcity: FG, marketers trade blames over transport claims (Daily Trust)
Amidst raging queues for Premium Motor Spirit (PMS) also called petrol in Abuja and some states, federal government agencies in the petroleum industry, as well as the product marketers, have traded blame on claims of payment and product loading volume. Daily Trust reports that the queues in Abuja resurfaced last weekend when it was observed that among over 30 retail outlets, less than five were selling as vehicles lined up to buy petrol. The scarcity became worse on Monday as black marketers had a field day selling a 10-litre volume for N2,500 within the city centre.
“We have been seeing this sign since last week but it was not that bad. However, since Friday, the retail outlets have started drying up in my area around Lugbe,” said Silas John, a commercial driver.
Technology, policy: Nigeria’s energy transition pathway – FG (The Guardian Nigeria)
The Federal Government says it is following an energy transition pathway that combines technology, investment, business strategies and policy. The government says this will enable Nigeria to transition from its current energy system to a low-carbon energy system with natural gas playing a pivotal role over the next generation, between now and 2060. Chief Timipre Sylva, Minister of State for Petroleum Resources, made the assertion on Tuesday at the virtual Society of Petroleum Engineers (SPE) Lagos Annual Technical Symposium and Exhibition.
Sylva said natural gas was a key resource for energy transition and had all the credentials to support Nigeria and indeed Africa meet up with her commitment with the UN 17 Sustainable Development Goals (SDGs). He said as a major source of wealth and energy in Africa, the development of oil and gas resources proved critical for the continent’s economic growth and revenue expansion.
“First off, Africa and the world need oil (and gas for that matter). The world needs oil and gas because it is what the world relies on for its most basic needs. And that will not change overnight. “Therefore, African governments and leaders should continue to invest in oil and gas, even as we work to help speed progress to a lower-carbon future.
Why FG should expedite AfDB ‘s SAPZ takeoff (The Sun Nigeria)
The rapid rollout of the first phase of the Special Agro-industrial Processing Zones (SAPZ) programme of African Development Bank(AfDB) to support inclusive and sustainable agro-industrial development in countries across Africa has been clogged in Nigeria. This was even as stakeholders are calling on the Federal Government to see reasons for its quick takeoff.
Last December, the AfDB’s board of directors approved a $160-million loan to get the programme off the ground in seven states and the Federal Capital Territory (FCT). Additional co-financing for its first phase will come from the International Fund for Agricultural Development (IFAD) and the Islamic Development Bank (IsDB) in the amount of $150 million. The Nigerian government is expected to provide about $18.05 million toward the program’s rollout and implementation.
The project is a mega cluster-based infrastructure venture to aggregate farmers, processors and retailers to connect agricultural production to the market.
How US supports trade, investment in Nigeria – Consulate (The Sun Nigeria)
The U.S. Consulate and the Nigerian-American Chamber of Commerce (NACC) on Tuesday urged Nigerian businesses to take advantage of the U.S. mission’s trade initiatives for a greener economy. They made the call during the NACC May Breakfast Meeting with the theme: “U.S. Mission’s Current Commercial-focused Activities in Nigeria” held in Lagos.
According to him, some of the initiatives include Prosper Africa, African Growth and Opportunity Act (AGOA), West Africa Trade and Investment Hub, Networking with USA (NUSA) and initiatives targeted at women-led businesses. Russell said the Biden administration was focused on two-way trade between Africa and the U.S., adding that he was committed to revitalising partnerships based on dialogue, respect and mutually shared values.
Study to assess turnaround time in goods clearance underway (Graphic Online)
The Customs Division of the Ghana Revenue Authority (GRA) has initiated a project to assess the average turnaround time in the goods clearance process at the country’s seaports. The project, Time Release Study (TRS), is an internationally accepted strategic tool of the World Customs Organisation (WCO) to measure the actual time taken for the release and/or clearance of goods - from the time of arrival until the physical release of cargo. To be completed in the next six months, the study seeks to further improve effectiveness and efficiency of border procedures relating to imports, exports and transit movements of goods.
Speaking to the Daily Graphic at the workshop, the Deputy Commissioner of Customs in-charge of Petroleum Operations, Yaw Baffour Asare, said the project sought to identify associated bottlenecks objectively and address them in an efficient and effective manner. He said the WCO TRS was specifically referenced in Article 7.6 of the WTO Trade Facilitation Agreement (TFA) as a tool for members to measure and publish the average release time of goods. He said in recent years, the tool had been capturing a lot of attention worldwide; the international donor community and the WCO development partners were recommending it as a key performance measure to assess, evaluate, and enhance the implementation of the WTO TFA.
Nigeria holds a leading position in the African maritime sector ― Ambassador Akinkugbe (Tribune Online)
The Nigerian ambassador to Greece, Opunimi Akinkugbe, has said that Nigeria holds a leading position in the African maritime sector. According to her, Mrs Folorunsho’s mission is to explore opportunities in the maritime sector for African shipowners to be able to move cargo across the continent under the African Continental Free Trade Area (AfCFTA) that will create wealth and jobs.
“Naturally, so much needs to be done to bring this to reality,” Akinkugbe said. She added that Nigeria holds a leading position in the African maritime sector; and that Greece, as a maritime nation by tradition, can offer experience and expertise in the sector across the African continent. “Shipping has been a key element of Greek economic activity since ancient times,” Akinkugbe said. “Today, shipping is the country’s most important industry and it remains one of the world’s largest shipowning nations.”
Poor patronage, high production costs shrink textile firms to below 20 (The Guardian Nigeria)
Poor implementation of the patronage policy, high cost of production, high level of importation, smuggling among other challenges have continued to undermine Nigeria’s textile sector, shrinking the number of viable textile firms to less than 20 from 175 firms in 1985. According to the Nigerian Textile Manufacturers Association (NTMA), the textile sector, which used to be the highest employer of labour, lost at least 117,000 jobs within 26 years, with more losses underway without government’s intervention. The association noted that the industry’s declining export capacity, having led to the loss of preferential market access in the EU and US, was attributable to inconsistent implementation of Export Expansion Grant (EEG) policy, particularly, the perennial backlog of EEG claims, and the inconsistencies in the implementation of ECOWAS Trade Liberalisation Scheme.
The Federal Government (FG) of Nigeria has disclosed it was following an ‘energy transition pathway’ that combines technology, investment, business strategies and policy. Minister of State for Petroleum Resources, Timipre Sylva, said the aforementioned plan would enable Nigeria transition from its current energy system to a low-carbon energy system with natural gas playing a pivotal role over the next generation, between now and 2060.
Sylva opined that natural gas was a key resource for energy transition and had all the credentials to support Nigeria and indeed Africa meet up with her commitment with the United Nations (UN) 17 Sustainable Development Goals (SDGs). He stated that as a major source of wealth and energy in Africa, the development of oil and gas resources proved critical for the continent’s economic growth and revenue expansion, saying fossil fuels would remain relevant in the energy mix despite ongoing campaigns and global energy transition.
Togo opens land border with Ghana (Graphic Online)
Togo on Monday night opened its land border with Ghana, coming more than 50 days after Ghana reopened its land borders to neighbouring countries. When Graphic Online’s Volta Regional correspondent Alberto Mario Noretti visited the border post in Lome at about 8:30 am Tuesday [May 17, 2022] the metal gates which were closed between the two countries for two years in the wake of the coronavirus pandemic, were swung open. That, notwithstanding, both sides of the frontier remained desolate with little human movement and commercial activities across the border.
African trade news
13th WTPO conference AfCFTA, ITC sign MoU - AfCFA boss says trade networks can boost trade on continent (Graphic Online)
The Secretary General of the African Continental Free Trade Area (AfCFTA) Secretariat, Wamkele Mene, has asked African countries to leverage the platform provided by the trade pact to create regional trade networks and global affiliations. He said this would enable their markets to build resilience in the supply chains and reduce reliance on external markets.
“The COVID-19 pandemic has provided us a once in a lifetime opportunity to make bold decisions that will put us on a path to resilient, inclusive and sustainable economic recovery. “With the AfCFTA, Africa now has an important instrument to assist countries to look inward for solutions to their COVID-19 economic challenges,” he said during the opening of the 13th World Trade Promotion Organisations (WTPO) conference in Accra on May 17. “Indications are that the recovery will be an arduous and complex process as there are still many uncertain and changing factors, including Russia-Ukraine conflict, which has created new concerns. “Now is the time to rebuild our economies and secure Africa’s future,” he said.
Understanding the African Continental Free Trade Area and how the US can promote its success (Brookings Institution)
The significance of the AfCFTA cannot be overstated. It is the world’s largest new free trade area since the establishment of the World Trade Organization (WTO) in 1994. It promises to increase intra-African trade through deeper levels of trade liberalization and enhanced regulatory harmonization and coordination. Moreover, it is expected to improve the competitiveness of African industry and enterprises through increased market access, the exploitation of economies of scale, and more effective resource allocation.
My research has shown that the AfCFTA — and its accompanying increased market access — can significantly grow manufacturing and industrial development, tourism, intra-African cooperation, economic transformation, and the relationship between Africa and the rest of the world. In fact, under a successfully implemented AfCFTA, Africa will have a combined consumer and business spending of $6.7 trillion by 2030 and $16.12 trillion by 2050, creating a unique opportunity for people and businesses — and meaning the region can be the next big market for American goods and services.
Although there is a great momentum behind the agreement, its successful implementation is dependent on smart choices and thoughtful policy options. The United States can and should play an extraordinary role in promoting the AfCFTA’s success to increase intracontinental and global trade, as well as achieve mutual African and U.S. prosperity.
Landry Signé is a Senior Fellow at the Brookings Institution’s Africa Growth Initiative
The dice is loaded against Africa: ministers call for reform (UNECA)
African economy, finance and planning ministers, businesses and economists attending a conference in Dakar, Senegal, have made an impassioned case for a complete overhaul of the global financial architecture.
The Conference of Ministers (CoM2022) – organised by the United Nations Economic Commission for Africa (ECA) and hosted by the government of Senegal – heard from economists and executives who argued that these global arrangements, ostensibly meant to maintain stability in the international financial system, were outdated and unfair to many developing countries.
In Africa, they are “not fit for purpose,” said Vera Songwe, UN Under-Secretary General and Executive Secretary of UN Economic Commission for Africa. Giving the keynote speech at CoM2022, President Macky Sall of Senegal, said Africa was being dictated to although it had over a decade of good growth, only suffering a reversal, like the rest of the world, because of the coronavirus pandemic.
CoM2022 - Remarks by President Macky Sall, Senegal (UNECA)
Africa needs infrastructure development for sustainable, inclusive growth (Businessday)
Economic growth has been slow in Africa following varied growth rates in three of Africa’s largest economies – Angola, Nigeria, and South Africa, according to the World Bank latest report. Africa’s gross domestic product growth rate is estimated at 3.6 percent in 2022, representing a downward movement from 4 percent in 2021. One of the factors slowing down Africa’s economic growth rate is infrastructure deficiency. Adequate and quality infrastructure in all the African countries is critical for sustainable and inclusive growth in the continent. The African Development Bank (AfDB) estimated Africa’s infrastructure financing needs to be as much as $170 billion a year by 2025, with an estimated gap of about $100 billion a year. The infrastructure gap challenge has aggravated the problems of unemployment, low productivity, and poverty in Africa. According to the Programme for Infrastructure Development in Africa, the road access rate in Africa is only 34 percent, compared with 50 percent in other parts of the developing world and transport costs are 100 percent higher. Only 30 percent of Africa’s population has access to electricity, compared to 70-90 percent in other parts of the developing world. Water resources are underused with only 5 percent of agriculture under irrigation. The internet penetration rate is a mere 6 percent, compared to an average of 40 percent elsewhere in the developing world.
The insufficient stock of productive infrastructure in power, water, and transport services that allow firms to thrive in industries hinders industrialisation in Africa. Africa must industrialise to end poverty and generate employment for about 15 million young people who join its labour force every other year.
Increase investment for infrastructure development - Raila tells Africities conference (The Star, Kenya)
There is a need for increased investment towards the realization of infrastructural development, African Union’s high representative for infrastructure Raila Odinga has said. Raila expressed concerns over an infrastructure gap in Africa saying the trend had slowed down the development aspirations over the years.He noted that the region needed more investment in infrastructure to be able to tap available economic potentials through inter-trade opportunities as well as achieve full growth.
African ports eye increased trade as piracy threats drop (Business Daily)
African ports are expected to witness an increased number of ships and reduced cost of shipment as a result of a drop in piracy and armed robbery cases. This means cargo ships destined to the ports of Mombasa, Dar es Salaam, Jeddah, and Djiobuti will no longer have to use long routes in their bid to evade pirates. A new report, Safety and Shipping Review 2022, says reduced cases of piracy will see sea freight and maritime insurance premium for cargo going down thus reducing the cost of shipment. Shippers Council of Eastern Africa (SCEA) SCEA chief executive officer Gilbert Lagat said the reduced cost would not only save Kenya and other East African traders millions of dollars in insurance and security expenses, but it will encourage more ships to call at different ports. “Reduced risks as a result of improved surveillance will lower cost of importation and also encourage those shipping companies which suspended their operations along such route to resume,” said Mr Lagat.
Stakeholders draw roadmap for sector’s recovery (New Telegraph Newspaper)
The 10th Aviation Stakeholders Convention hosted by the African Airlines Association (AFRAA) and Kenya Airways kicked off today at the Emara Ole-Sereni hotel, Nairobi, Kenya. The two-day convention will provide a platform for showcasing new developments and innovations in aviation, discussing industry business trends, networking and forging new partnerships. The Convention, under the theme: “Beyond the crisis,” brings together over 500 delegates from 47 countries across the globe attending both physically and virtually.
The Convention is one of Africa’s major forums for air transport industry stakeholders to dialogue and exchange knowledge and experiences for the development of the travel ecosystem.
Mr Abdérahmane Berthé said: “I call upon stakeholders to join this noble initiative which will bring experts from various sectors to craft solutions to transform business in the region and ensure the efficient development of intra- Africa air transport,” he said.
Dr Joseph K. Njoroge, CBS, the Principal Secretary, State Department for Transport, Government of Kenya called for continued cooperation for resilient recovery and growth of the industry, noting that “among the industry actions for recovery by airlines is the enhanced cooperation and collaboration. This will establish stronger and more efficient airlines with business models that will allow them to compete internationally and improve Africa’s air traffic market share which is currently very low.”
Aid to Africa continues to be challenging (Africa Aviation News)
Aid relief in Africa faces a complex set of challenges; getting aid to the continent is one thing, moving it across various countries and the final ‘last-mile’ journeys can be incredibly difficult. “The challenges are amplified by natural disasters, conflicts, bureaucracy and often problematic transportation infrastructure,” according to a whitepaper by Danish carrier Maersk titled Delivering Relief: When it’s Needed, Where it’s Needed. The supply chain is thus a vital cog of all humanitarian responses, not least because over 70 percent of spending relates to it and cost-effective logistics is indispensable, the study said.
Africa is the world’s second largest, and second most populous continent in the world with an area covering 30.37 million km², across 54 countries that are home to almost 1.4 billion people. “With 20 of its countries currently considered fragile or conflict-affected, together with the impact of the Covid-19 pandemic in Sub-Saharan Africa, poverty, displacement and disease, aid and development are still critical. Private sector investment is one part of the solution towards recovery and resilience, according to the analysis.
Africa yet to succeed in internal mobilization of resources leading to prosperity (News Ghana)
The African continent has not succeeded in the internal mobilization of resources leading to prosperity due to the fight against the COVID-19 pandemic and climate change, UN Under-Secretary-General and Executive Secretary of the UN Economic Commission for Africa (UNECA) Vera Songwe said Monday in Senegal. Even though finance ministers and central bank governors have done a good job in the fight against COVID-19, but “to survive is not to achieve growth and prosperity”, she said, emphasizing that Africa must manage to have funding to operate a real revival of its economy. She pleaded for a transformation of the continent’s economies, with a policy of regional integration, good governance of resources and digital development.
African Development Bank Group President Akinwumi Adesina has urged international development agencies in Africa to rally behind his institution’s efforts to mobilize more resources to help build resilience for sustainable development across Africa. Adesina told diplomats and international agency representatives at a breakfast meeting in Accra last Thursday that African countries need more resources to fight climate change, to deal with insecurity, debt, and the impact of war in Ukraine. He said funds are also needed to address the massive infrastructure deficit, growing urbanization, and youth unemployment. .
“We are making the case for a strong 16th replenishment of the African Development Fund. It is crucial for Africa, and I will very much appreciate your advocacy for a substantial replenishment,” Adesina stressed. This year marks the 50th anniversary of the Fund’s establishment. Adesina said the Bank is committed to doing more to improve livelihoods on the continent. “We need to have a lot more to drive a just energy transition, climate adaptation, to invest in infrastructure, in food production and to build resilience for Africa.”
Debt crunch: Africa is a net creditor to the rest of the world (Monitor)
Africa’s borrowing appetite has reached a level where something may have to give in. In an interview with Prosper Magazine’s Ismail Musa Ladu during the course of the second AFRODAD Media Initiative (AFROMEDI) held in Nairobi, the executive director of African Forum and Network on Debt and Development (AFRODAD), Mr Jason Braganza whose Pan-African organisation is committed to finding solutions to Africa’s challenges in debt, resource management and financial development, explained why the continent needs to start assuming the role of rule maker rather than rule taker to deal with debt issues.
We need to look at the structure of our economies in the continent and make it work more efficiently for us in terms of generating optimum returns. We are still producing very low value agricultural commodities, thanks to the weak value chain that does not facilitate value addition. This has an impact on revenue mobilisation. Also, most of our economies are heavily relying on primary commodity exports which are very vulnerable to price shocks and related development. The continent also needs to decide how to deal with the issue of fiscal (revenue) leakages. We lose billions of dollars every year through illicit financial flows (IFFs) and I think the latest estimates the continent is losing as a result of this fraud and related scam is in the range of around $100 billion a year. Illicit financial flows come in many shapes and forms. It could be tax related, crime, corruption or even debt related. Then we must end the obsessions with economic growth rather than the actual development.
Given the exploitation of our natural resources, both beneath and above the ground, and looking at how much we lose in form of IFF and related fraud – we are compelled to believe that Africa is a net creditor to the rest of the world. This is because estimates show that for any dollar that comes to Africa – three dollars leave the continent. Because of that, we deserve to sit at the table setting the development agenda at all levels when it comes to commerce, trade, finance and economics.
Curbing Illicit Financial Flows Needs Global Framework—Owasanoye (Business Post Nigeria)
The Chairman of Nigeria’s Independent Corrupt Practices and Other Related Offences Commission (ICPC), Mr Bolaji Owasanoye, has rallied a global action against Illicit Financial Flows (IFFs), including a call for a global framework on IFFs similar to corruption. Mr Owasanoye made this call at a side event of the ongoing hybrid 54th Conference of the United Nations Economic Commission for Africa (UNECA) taking place in Dakar, Senegal. According to a statement issued by the ICPC’s spokesperson, Mrs Azuka Ogugua, the conference would focus on regional efforts to track, recover and return stolen assets from Africa through the IFFs.
“The challenge we found ourselves today is that the rules have always been skewed in favour of those who export capital and against those who import capital. Corruption is a global issue and we have a global framework for corruption. “The IFFs is also a global issue but does not have a global framework. “A way out of the problem is to institute a global framework on IFFs which, among others, will address the huge financial losses suffered by African countries,” the ICPC chairman stated.
MSMEs Must Be Supported To Address Post-Covid Economy Challenges - Trade Minister (Peace FM Online)
Mr Alan Kyerematen, the Minister for Trade and Industry has tasked Trade Promotion Organisations worldwide to effectively support Micro, Small and Medium Enterprises (MSMEs) to address the challenges of the post-COVID economy.He said the assistance for MSMEs was now a development imperative because of their key role in employing majority of the world’s workforce. Mr Kyeremanten was addressing the opening session of the 13th World Trade Promotion Organisations conference and awards in Accra to discuss ways in which they could best support the private sector to enhance production and productivity levels.The conference is being held on the theme: “Bold solutions for Resilience and Recovery.”
“Trade must be mainstreamed in national development plans. Programmes and projects that enhance trade must be aggressively pursued by TPOs,” he said.
Mr Wamkele Mene, the Secretary-General, AfCFTA Secretariat, said Africa’s private sector, a key pillar of the economy, was severely affected by the pandemic as it took its toll on SMEs. “So, as we transition from the pandemic to a new normal marked by renewed efforts at continental integration, let us work together to strengthen our integration including through digitalization. This will enhance intra-African trade; build resilience to future crises; and ensure the continent emerges more connected and more inclusive.”
Good Governance in Sub-Saharan Africa: Opportunities and Lessons (IMF)
Sound institutions that guarantee integrity in the management of public affairs are critical on the path toward higher and more inclusive growth. Countries around the world that improved their governance systems, such as Botswana, Rwanda and the Seychelles in Sub Saharan Africa are reaping a “governance dividend.” Liberia, Sierra Leone, and Angola have demonstrated that reforms are possible, even in fragile environments. Countries with stronger institutions have also been able to mount more effective response to the pandemic. To discuss this issue and attempt to assess the importance of good governance and transparence in Sub Saharan Africa, the IMF published a book “Good Governance in Sub-Saharan Africa: Opportunities and Lessons“ on March 18.
Join us for the virtual launch of the book on Thursday, May 19 at 11:00 AM in Washington D.C (3:00 pm GMT) with African policy makers, civil society, and academics.
First workshop on Food Safety Data, Information and Knowledge Management System in Africa, held by African Union Commission (African Union)
The African Union convened its first workshop to deliberate on the enhancement of food safety information and knowledge management systems that should facilitate the effective data generation, analysis and knowledge exchange to support risk assessment, decision making, inform food safety policy formulation and harmonisation at national, regional and continental level and conversely boost inter-African trade within the context African Continental Free Trade Area (AfCFTA), as well as to improve food security and ensure consumption of safe food for better health of the populace.
Cross-country push: How few firms dominate African seeds market (Down to Earth Magazine)
Africa is now witnessing a continent-wide polarised battle between two seed management systems: Farmer seed systems, which is the dominant informal and indigenous system managed by small farmers, and the industrial seed sector, the formal trade dominated by a handful of multinational corporations along with local subsidiaries.
The newly adopted seed laws cover the formal industrial seed sector. Malawi’s new seed law is the latest development in this push to formalise, or industrialise, the seed sector in Africa, which has seen some 20 countries roll out seed policies in the past five years. The countries now seek to implemen
Joint Communique Between Afreximbank and APPO on the Need for the Establishment of an African Energy Bank (Afreximbank)
Considering the current discussions by APPO and AFREXIMBANK to jointly establish an African Energy Transition Bank, Concerned about the challenge posed to the African oil and gas industry and Africa’s economic development, by coordinated withdrawal of international trade and project financing from Africa’s oil and gas industry, Acknowledging the impact of climate change on Africa and aware that poverty fosters accelerated environmental degradation,
The two African institutions have resolved to work together to find an Africa-led solution to the challenge posed to the African oil and gas industry and an orderly energy transition in Africa by the withdrawal of funding by its traditional financiers. The two institutions have committed to taking necessary actions to promote a sustainable and balanced solution to the challenge of financing the oil and gas industry in Africa during the energy transition, through, among others, the establishment of an African Energy Transition Bank dedicated to supporting an Africa-led Energy Transition strategy that is consistent with the goal of preserving the environment and livelihoods.
What Can Be Done To Achieve Climate Justice For Africa (Forbes Africa)
Of all continents, Africa is least responsible for climate change. It has contributed only a minute part of the greenhouse gas emissions that are responsible for the climate emergency the world faces today. Yet, Africa faces the same arduous battle as the rest of the world to tackle the impacts of climate change, and to make itself resilient to climate change. Today, Africa remains one of the most vulnerable and the least climate-resilient regions in the world. This is manifest across all corners of the continent. In the Horn of Africa, millions are threatened as a historic drought looms. In the Sahel, climate change is fueling insecurity because of increasingly scarce resources. And southern Africa is experiencing lethal rain and floods. Action has never been more urgent. These climate change-induced challenges cut across many countries and sub-regions of the continent. With improved regional integration and deeper regional cooperation, African countries could rally around collective climate adaptation solutions and accelerate a just energy transition. The regional approach would elevate the individual voices of countries and facilitate access to increased global climate finance.
‘Green growth’ can help African countries address socio-economic inequalities: Report (Down to Earth Magazine)
Green growth can address inequity through the creation of decent jobs, better provision of basic services, improvement of air quality and enhancement of climate resilience
African countries need ‘Green Growth’ to address education and health-related inequalities that hinder socio-economic development on the continent and are likely to exacerbate the negative impacts of climate change, according to a recently released report. Green growth has the potential to address these inequalities through the creation of decent jobs, better provision of basic services, improvement of air quality and enhancement of climate resilience, the report added. Climate action and inclusive green growth were particularly important at the current moment, as economies around the world had been ravaged by the COVID-19 pandemic, according to the report. Africa Green Growth Readiness Assessment was launched May 11, 2022, during a side-event at the 15th session of the Conference of the Parties (COP15) of the United Nations Convention to Combat Desertification, underway in Abidjan from May 9-20.
India and Africa must respond to uncertain world: Jaishankar (The Times of India)
India and Africa must respond to the “volatile and uncertain” world and important lessons can be learnt from the COVID-19 pandemic and knock-on effects of the Ukraine conflict, External Affairs Minister S Jaishankar said on Tuesday. In an address at a book release event, Jaishankar said development partnership and capacity building is at the core of India’s relationship with the African continent and it speaks for New Delhi’s shared desire of developing together as “equals”. He said India was “very conscious” of the expanding threats of radicalism, fundamentalism and terrorism to African societies and both sides have been cooperating in dealing with the challenges. “Today, our ties too must respond to the volatile and uncertain world that we confront,” he said.
“There are important lessons to be learnt from the pandemic disruption. The stresses from the knock-on effects of the Ukraine conflict are also relevant,” Jaishankar said.
Referring to India-Africa trade cooperation, Jaishankar said the story on this front is also an encouraging one. “India is today the fourth largest partner for Africa registering trade of USD 69.7 billion during 2018-19. This has obviously been impacted during the Covid years but we are expecting a strong recovery,” he said. In terms of investment, India ranks fifth with a cumulative commitment of USD 70.7 billion in Africa, Jaishankar said.
Global economy news
WTO launches new WTO data portal (WTO)
The new portal allows users to navigate a wide range of WTO databases covering trade in goods, services, dispute settlement, environmental measures, trade-related intellectual property rights and more. One of the databases is the “WTO Stats portal”, which allows users to access and download time series statistics on trade in goods and services on an annual, quarterly and monthly basis. It also contains market access indicators providing information on governments’ bound, applied and preferential tariffs as well as non-tariff information and other indicators.
Upcoming report examines economic fallout from the war in Ukraine (UN DESA)
UN DESA’s World Economic Situation and Prospects as of mid-2022, set to be released on 18 May 2022 (today), will delve into the multitude of local, regional, and global economic consequences of the current war in Ukraine.
New World Bank Report Says MENA Labor Markets Need Level Playing Field (World Bank)
Ensuring the private sector can gain access to markets and compete equally with government-run businesses is vital for countries across the Middle East and North Africa (MENA) to create jobs in a region with the highest youth unemployment in the world, according to a new World Bank report. The report, titled “Jobs Undone: Reshaping the Role of Governments Toward Markets and Workers in the Middle East and North Africa,” offers policy recommendations for how MENA governments can overcome continuing labor market stagnation that undermines economic development and social progress a decade after the Arab Spring uprising. Crippling joblessness, especially among MENA youth and women, requires a more prominent and vibrant private sector as well as regulatory reforms for the labor and product markets, says the flagship report.
Healing the pandemics economic scars demands prompt action (IMF Blog)
The Group of Twenty economies continue their recoveries from the pandemic, but the unprecedented shock could still leave long-lasting scars that reduce economic prospects compared with their pre-crisis trends.
Pandemic-induced losses for both economic output and employment will be significant in coming years, as discussed in our April World Economic Outlook. Emerging market economies are likely to endure greater losses because they had relatively less access to vaccines and their pandemic-support packages were smaller. For many economies, the outbreak of the war in Ukraine is adding to the challenges.
Our new analytical work finds that, among the key causes of scarring from the pandemic are the prospective weak labor market recoveries in emerging market economies and the severe disruptions to schooling over the past two years across both advanced and emerging economies. Policymakers must act promptly to repair the damage from the crisis and prevent decades of diminished economic output from lost human capital.
Aviation sees rebound to pre-Covid levels earlier than projected (Business Daily)
The aviation industry is projected to return to pre-Covid levels earlier than expected following a recovery in business and easing of Covid-19 restrictions across the world. The International Air Transport Association (IATA) says the sector could return to pre-pandemic passenger traffic levels sooner than the 2024 date that had earlier been issued. IATA chief executive officer Willie Walsh told Reuters recently that the industry could reach 2019 traffic levels by next year. Mr Walsh said the ongoing war in Ukraine, prevailing restrictions in China, high oil prices, and travel delays from staff shortages are not denting the recovery. “I don’t think we should be distracted from the fact we are seeing a strong recovery and I think that recovery will gather momentum as we go through the rest of this year into 2023,” Mr Walsh said. Early this month, IATA said with barriers to travel coming down in most places, they were seeing the long-expected surge in demand across different regions.
International Migration Review Forum (IMRF) (UNDP)
Remittances to low and middle-income countries reached an all-time high of $589 billion in 2021 -- vastly exceeding Overseas Development Assistance. Yet, we are also seeing how migrants, especially women, are suffering from increased xenophobia and discrimination. In this context, I would like to highlight 3 Key Areas to set the stage for today’s roundtable.
First, the protection of migrants starts even before they move abroad. In this context, what are the economic, social and environmental factors that force people to leave their countries? Second, we know that minimizing the adverse drivers of migration should not be the central priority of migration policies. Third, to promote inclusive societies and enhance migrants’ contribution to sustainable development, advancing social cohesion is pivotal.
G20 Empower holds women leaders’ meeting to realize gender equality (ANTARA)
The government and business parties need to encourage further implementation of policies and practices as a form of support to women-owned MSMEs to handle existing challenge
The 2nd Plenary Meeting of G20 Empower scheduled a meeting between women leaders in the private and public sector to share their experiences to realize gender equality in the work environment. “G20 Empower is an important platform for advocates to share their experiences and practices,” Women’s Empowerment and Child Protection Ministry’s official, Eko Novi Ariyanti, stated through a press statement on Tuesday evening.
I welcome the report of the Independent Evaluation Office (IEO) on IMF Engagement with Small Developing States (SDS), which finds a substantive and well-tailored Fund engagement with SDS across modalities over the last decade. I broadly agree that, going forward, the Fund’s continuous high-quality engagement—cognizant of the unique characteristics and challenges faced by SDS—should help enhance traction with this group of members. With the Fund’s agenda already well-oriented toward supporting SDS, including through new workstreams, I concur that a targeted recalibration of the Fund’s work on SDS would be the most effective at this juncture. However, the four recommendations and their detailed suggestions must be weighed against their budgetary implications, which are inconsistent with the just-approved Medium-Term Strategy and budget. The report and its recommendations should also be careful to not impinge upon areas that are still unfolding, such as the RST, crisis response, and CD provision, to avoid unnecessary duplication of efforts and ensure that a coherent and evenhanded framework is in place. I offer qualified and/or partial support to the recommendations, as discussed below, to serve better our SDS members.
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Local news
5 global export bans that shook SA agriculture (Food for Mzansi)
In less than two years South Africa’s agricultural sector has been dealt a few blows by countries who are seemingly weaponising trade policy instruments and banning exports during times of uncertainty to ensure adequate domestic supply.
However, according to Wandile Sihlobo, chief economist of the Agricultural Business Chamber of South Africa (Agbiz), countries should pull the plug on taking drastic self-interested policy measures. Instead they should focus on supporting farmers to increase production and fill the gap in supplies. Since last year, there’s been at least four bans impacting global agricultural trade. The war by Russia on Ukraine has also had a direct and more severe impact on the international market.
In 2020, the likes of Vietnam and Kazakhstan banned grain export. agriculture ministers from the G7 countries however criticised the move and the bans were subsequently reversed.
In July 2021, China went as far as banning exports of fertiliser in an attempt to ensure adequate domestic supply. According to Sihlobo, “Such inward-looking policy actions often have a notable disruption on the highly interconnected global agricultural market.”
Sihlobo explained that the first significant agricultural exporter to introduce restrictions this year was Indonesia at the end of April. Indonesia temporarily banned palm oil exports.
The impact of the Russia-Ukraine invasion has had a direct and severe impact on the agricultural market. This is because both countries contribute substantial volumes of grains, oilseeds and fertiliser exports.
The most recent country, India, has followed with similar steps announcing a ban on wheat exports.
“Overall, with heightened uncertainty, the ban on exports of essential commodities should not be a preferred policy instrument, especially by major agricultural producers such as India and Indonesia, among others,” said Sihlobo.
Mombasa Port: how Kenya’s auditor-general misread China’s Standard Gauge Railway contracts (The Conversation)
In December 2018, a leaked letter from the Kenyan auditor-general’s office sparked a rumour that Kenya had staked its bustling Mombasa Port as collateral for the Chinese-financed Standard Gauge Railway. Our new research shows why the collateral rumour is wrong. The former auditor-general, Edward Ouko, was completing the 2017/18 audit of the national ports authority. He warned that the port authority’s assets – of which Mombasa Port is the most valuable – risked being taken over by China Eximbank if Kenya defaulted on the US$3.6 billion railway loans. The profitable Mombasa Port is East Africa’s main international trade gateway. Launched in 2017, the railway was intended to seamlessly link the port to Kenya’s capital, Nairobi, and landlocked countries beyond.
Farmers to get training on avocado export rules (Business Daily)
The Avocado Society of Kenya (ASOK) has started sensitising farmers on the new avocado export regulations announced by the Horticulture Crops Directorate, chief executive officer Earnest Muthomi has said. Last week, the Directorate raised the minimum solid content for export avocados from 20 and 21 percent for Fuerte and Hass varieties respectively to 24 percent in order to comply with international standards. The horticultural regulator said the changes would ensure Kenyan fruits are competitive in the global export market.
“Some farmers don’t understand what these regulations mean in terms of their earnings and we have launched an initiative to educate them on the same. We are telling them that they are not being targeted unfairly and that the regulations are for their own good,” said Mr Muthomi.
“There has been stiff competition from the world market and our farmers should know that they have to produce quality fruits. The most serious problem is that farmers are enticed by brokers to harvest immature avocados which spoil Kenya’s reputation in the international markets and we want this to stop,” he added.
Inside Uganda, Tanzania power lines deal (The East African)
Uganda and Tanzania have committed to building the 400kV Masaka-Mutukula-Kyaka-Nyakanazi-Mwanza transmission line. Uganda will sell surplus power, and Tanzania will meet its demand for electricity. During her two-day state visit to Kampala last week, Tanzanian President Samia Suluhu and her Ugandan counterpart Yoweri Museveni witnessed the signing of an inter-governmental memorandum of understanding for the development of the 400kV transmission line linking the two countries.
Officials of the Uganda Electricity Transmission Company Ltd (UETCL) said it is too early to talk about the start, cost and completion details. “The MoU has just been signed meaning there is nothing really done yet [before] there is sourcing for funding, feasibility studies and all,” said Pamela Nalwanga Byoruganda, the UETCL spokesperson. With additional generation from Karuma and other smaller hydropower plants, Uganda’s total installed capacity will increase to nearly 2000MW, up from the current 1,346.6MW, against the country’s peak demand for electricity, of 794MW, the Electricity Regulatory Authority said.
National airline vital for aviation industry AfCFTA implementation Hassan Tampuli 1539503 (GhanaWeb)
Deputy Minister for Transport Hassan Tampuli has underscored the importance of a new national airline in improving the country’s economy. According to him, the setting up of a home-based carrier will not only boost the country’s aviation industry but will also open up other avenues under the African Continental Free Trade Area.
“In terms of infrastructure, we have embarked on massive infrastructure developments to improve all our sea ports, airports and railway connectivity. Currently, two of our regional domestic airports in Kumasi and Tamale are being upgraded into international status,” Tampuli said.
Traders justify sale of counterfeit goods (The Namibian)
Joyce Paolo has been selling brands of second-hand shoes and other high-end T-shirts from Vietnam for over nine years, from her house at Walvis Bay. After eight years of looking for a place to trade formally, she was able to secure a small shop on Sam Nujoma Avenue, where she has been trading since 2020. “We buy our things from overseas and the Democratic Republic of Congo. We don’t buy the original because no one in Namibia would be able to afford a pair of US$500 shoes from the real Nike shop. There is first hand and second hand, and we buy second hand which is affordable for our people,” she said.
“The only problem we encountered at the borders is when we import more than 20 pairs of shoes. This is not ideal because we have customers who have paid for their orders,” said Paolo. Walvis Bay community activist Knowledge Ipinge attributes corruption, bribery, poor intellectual property legislation and weak enforcement to what he terms favourable conditions for counterfeiting. He believes the country urgently needs a copyright bill.
Low prices, market access brew storm for EA tea industry (The East African)
East Africa’s tea sector is threatened by underperformance as its two key markets – Russia and Ukraine – remain closed. Observers worry that besides dealers not fully harnessing the quality of tea produced in the region, they are now going slow on production fearing it would lead to a glut that would push down prices that have been recovering after a pandemic slump. Rwanda’s tea prices at the Mombasa auction continued to fetch premium prices, having been on a recovery trajectory from $2.94 per kilogramme in 2021 to $3/kg in January 2022, and heading towards pre-pandemic prices of $3.05/kg of January 2020.Rwanda has grown its exports to 35.2 million kilogrammes a year.
But Mr Iruta says Rwanda’s key markets are not fully opened and now the Russian invasion of Ukraine threatens further logistical disruptions as both countries are some of the biggest consumers of tea.
Egypt records 29.4% decrease in trade deficit during February 2022 (Daily News Egypt)
Egypt recorded a trade deficit of $2.7bn in February 2022, down from February 2021’s $3.82bn — a decrease of 29.4% — according to the Central Agency for Public Mobilisation and Statistics’ (CAPMAS) monthly bulletin for foreign trade. However, the value of exports Increased by 41%, bringing in $4.12bn, up from $2.92bn. This is due to an increase in the value of some commodities such as other articles of textile materials by 76.8%, potatoes by 56.8%, Ready-made clothes by 19.5%, and fertilisers by 11.6%. Meanwhile, the value of some exported commodities decreased, including fresh oranges by 31%, miscellaneous edible preparations by 11.7%, dairy products by 6%, and carpets and Kelem by 4.3%.
Minister: Egypt Launches Initiative with African Union to support Transformation in Energy Sector (Sada El balad)
Eng. Tarek El Molla, Minister of Petroleum and Mineral Resources, participated in the meeting organized by the American Chamber of Commerce in Cairo with the delegation of American institutions working in the field of green energy investment (Greentech), who is currently visiting Egypt.
The Egyptian minister added that after passing that stage, Egypt adopted the use of natural gas, the cleaner fossil fuel as a transitional fuel towards the energy transition and the expansion of its uses of hydrocarbon until the percentage of its use reached 65% compared to 35% for other hydrocarbon sources. 167 duplicates removed
Under Secretary Fernandez Visits Zambia, Strengthens U.S.-Zambia Economic Partnership (U.S. Embassy in Zambia)
During his May 12-13 visit to Zambia, Under Secretary for Economic Growth, Energy, and the Environment Jose W. Fernandez met His Excellency President Hakainde Hichilema to discuss opportunities to enhance bilateral trade and investment, and support for Zambia’s economic recovery agenda and debt restructuring efforts. The Under Secretary and President Hichilema also discussed the importance of building stronger people-to-people ties to promote inclusive economic growth and prosperity. Under Secretary Fernandez visited one of Zambia’s largest mining operations and spoke to industry experts about how the United States can help promote efforts to build robust and responsible critical mineral supply chains.
Morocco, Spain reopen land borders after two-year COVID-19 closure (Al Arabiya English)
Morocco and Spain have reopened the land borders between the north African country and the Spanish enclaves of Ceuta and Melilla, two years after they were shut due to COVID-19 restrictions and a major diplomatic row. The enclaves on the Mediterranean coast in northern Morocco have the European Union’s only land borders with Africa.
At the Fnideq border post, smiles lit up the faces of the travelers crossing to see their families on the Moroccan side. The local economies on both sides of the borders depend on the crossing of people and goods.
African trade news
New tool to measure ease of inter-Africa trade launched (The New Times)
The Economic Commission for Africa (ECA) on Sunday, May 15, launched the first-ever comprehensive tool that measures how easy, or hard, it is to do business between African countries. The AfCFTA Country Business Index (ACBI) has three key objectives including assessing the perceived impact of the African Continental Free Trade Area on the private sector’s ability to trade and invest across African borders once the Area is operational.
“It will be used to identify key challenges that the private sector faces in its cross-border activities,” Stephen Karingi, Director of the Regional Integration and Trade Division of UNECA said.
AfCFTA risks losing its vision without good logistics – Krapa (BusinessGhana)
African countries have been asked to expand their logistics and transportation networks in order to keep the African Continental Free Trade Area (AfCFTA)’s goal alive, or risk losing its benefit. Member countries should enhance their regional value chains and build an efficient transportation system across the continent, a Deputy Minister for Trade and Industries, Herbert Krapa, has said. He called on African countries to build links that improve their abilities and capacities to feed industry in a sustainable manner, while speaking at the Chartered Institute of Logistics and Transports (CILT) African forum.
Report: Global Pandemic Increased Poverty in Africa (VOA Africa)
The global pandemic has pushed more than 55 million Africans into extreme poverty and reversed two decades of hard work in poverty reduction on the continent. The Economic Report on Africa for 2021 blamed the growing poverty on job losses, reduced income and the inability of households to manage the risks In a 150-page report launched in Dakar, Senegal, the United Nations Economic Commission for Africa said the coronavirus negatively impacted the continent’s economy.
Hanan Morsy, deputy executive secretary of the commission, said the pandemic eliminated 20 years’ worth of achievements made in fighting poverty. “The implication for the continent, one of the most critical implications of COVID-19, has been the reversal of very hard-won gains that the continent has managed to achieve in terms of reducing poverty,” she said. “So, we’ve lost two decades of hard-won gains of reducing poverty in Africa due to the pandemic.”
The economic decline caused by the lockdowns and the restrictions on people and the movement of goods has increased the number of newly poor on the continent by 55 million people and pushed 39 million others into extreme poverty.
Trading Aims: The Value of Africa’s Deep Integration Trade Agreement (EUBULLETIN)
Trade and investment relations with Africa are increasingly important to the European Union’s strategic goals. Given their geographic proximity and historical ties, the EU and Africa should both seek to build the foundations of comprehensive and mutually beneficial economic cooperation – as this would have economic and political benefits in everything from job creation, migration, and security to the green and digital transitions. The EU should engage in such cooperation: it is Africa’s most important trading partner, accounting for around one-third of African trade, and is a vital source of foreign direct investment (FDI) on the continent. Nonetheless, players such as China and Russia have an increasing influence on the African commercial landscape, and could weaken the position of the EU as Africa’s leading economic and political partner.
In this context, EU policymakers should view the recent creation of an Africa-wide market under the African Continental Free Trade Area (AfCFTA) as an opportunity to consolidate and strengthen commercial and geopolitical ties with Africa.
A renegotiation of current multilateral system needed to boost Africa’s recovery and growth (UNECA)
President Macky Sall of Senegal has called on Africa’s development partners to agree to a renegotiation of the terms of the current multilateral system in light of shocks dealt to the global economy by the COVID-19 pandemic and the war between Russia and Ukraine.
Cameroon: COBAC Bans Cryptocurrency In Cemac zone (Journalducameroun.com)
The sub-regional institutions continue to ban cryptocurrencies as a means of payment in the countries of the Economic and Monetary Community of Central Africa (CEMAC). Meeting on 6 May 2022 during an extraordinary session, it was the Banking Commission of Central Africa COBAC that categorically rejected any use of cryptocurrencies in financial transactions in the region. Cryptocurrencies are now banned in the Cemac zone (Cameroon, Central African Republic, Congo, Gabon, Equatorial Guinea). This decision results from the will of the Cobac to “guarantee financial stability and preserve customer deposits”. As a result, the COBAC prohibits any operation related to crypto-assets. It concerns “the subscription or holding of crypto-currencies of any kind for own account or for third parties”, says the financial institution. The ban also applies to “the exchange or conversion, settlement or hedging in currency or CFA franc of transactions relating to crypto-currencies”.
Cobac’s decision comes after bitcoin was formalised as a legal currency in the Central African Republic on 27 April 2022. The CAR becomes the 2nd country in the world after Salvador to grant this status to the virtual currency. In Cameroon, proposals have been made to regulate the use of cryptocurrency. But so far, there is no regulation in this area.
Digitalisation: Helping African businesses rise (The New Times)
There is strong potential for robust, sustained, and inclusive economic growth in Africa, and it is being fuelled by accelerated adoption of digitalisation. As Africa continues its transition to a digital economy, new technologies are positively disrupting sectors such as agriculture, manufacturing, financial services, urban development, transport, and logistics, resulting in the creation of new products, services, and jobs. The continent is also starting to see an increase in investment, the opening up of new markets, improved efficiencies — particularly within the supply chain — and cost savings across businesses.
Digital innovation has given rise to new goods and services, created opportunities for new business models and markets and has the ability to drive efficiencies in both the public and private sectors. Digitalisation is an enabler of e-commerce and provides many benefits to small and medium-sized enterprises (SMEs) and can help them integrate more easily into global markets. It can contribute to convergence of e-payment platforms, reduce transactions costs by providing quicker access to information, enable better tracking and management of logistics, and can provide advanced warning of potential delays or other issues to traders. It can also facilitate access to resources such as finance through peer-to-peer lending, and training.
According to the United Nations Conference on Trade and Development (UNCTAD) Economic Development Report for Africa (2021), thirty-four percent (34%) of African households are poor, living in some of the world’s most unequal societies with a regional Gini index of 0.40. Several African Union (AU) Member States have yet to develop efficient ways to support long-term growth and raise living conditions for most citizens who remain impoverished. The present rise of the 4th Industrial Revolution (4IR) holds immense potential for improving Africa’s sustainable development trajectory by creating more employment opportunities and promoting a level of entrepreneurship that reduce poverty.
Investing in Science, Innovation, and Technology (STI) is critical for Africa to achieve both Agenda 2063 and the 2030 Agenda for sustainable development. Research and innovation aim to boost the continent’s socio-economic development in the current knowledge-based and innovation led-economy. STI is a prerequisite for moving forward with the implementation of frameworks like the Science, Technology, and Innovation Strategies for Africa (STISA-2024) and the African Continental Free Trade Area (AfCFTA) which promote the attainment of both continental and global development goals. STISA-2024 supports a target pledged in the Lagos Plan of Action of 1980 requiring all AU member States spend at least 1% of their GDP on research to include national science, technology commissions, councils, and research institutions across African to keep up with the changing digital 4IR environment.
Despite the potentiality of the 4th Industrial Revolution, Africa appears to be lagging compared to other continents despite its wealthy youthful population and natural endowments. Fostering an innovation-driven and knowledge-based economy in Africa will be entirely dependent on how member States develop science and technology and innovation policies based on evidence.
Digital Earth Africa to deliver robust data infrastructure for the continent (UNECA)
Digital Earth Africa is steadfastly becoming the “connecting-the-dots” part of Africa’s efforts to harness information resources for the society and knowledge-led economy, says Oliver Chinganya, Director, Africa Centre for Statistics at the Economic Commission for Africa (ECA).
Positive impacts recorded in collaborative efforts between UN system and Africa (UNECA)
Opportunity and issues-based coalitions formed between entities under the UN umbrella on one hand, and the African Union (AU) and African countries on the other, were able to record significant successes over the last year.
ECA, Senegal share ideas on improving access to financing for Women and Youth in Africa (UNECA)
United Nations Economic Commission for Africa (ECA), through its Sub-regional Offices for North Africa and West Africa and the Institute for Economic and Development Planning (IDEP), in collaboration with the Government of Senegal, discussed on Saturday Innovative financing small and medium-sized enterprises for resilient recovery in Africa: a gender and youth perspective.
Call to Utilize COMESA Court Services (COMESA)
Zambia’s Attorney General, Mr. Mulilo Kabesha has urged businesspeople in the region to utilize the COMESA Court of Justice for arbitration of disputes. Addressing judges of the Court during their one-week annual retreat in Lusaka, Zambia, Mr. Kabesha observed that trade disputes are taken to other courts based in far flung areas, such as United Kingdom instead of using the COMESA Court which offers affordable services to aggrieved parties. He called for robust sensitization campaigns about the Court’s services in the region.
Egypt Calls for African Coordination Meeting Ahead of COP-27 (Ashraq Al-awsat)
Egypt on Sunday urged the African states to hold a meeting to coordinate the continent’s stances in preparation for the COP27 Climate Summit, which it will host in Sharm el-Sheikh next November. During a workshop held by Morocco via videoconference on “The challenges of mobilizing capital markets to finance the transition to a sustainable energy market,” Egyptian Ambassador to Ethiopia and the African Union Mohamed Omar Gad said Cairo invited the African states to hold the consultative session on the issues related to climate and energy before the Climate Summit. The workshop in Morocco comes on the sidelines of a conference for African ministers of finance, planning, and economic development, which will kick off Monday in the Senegalese capital, Dakar.
Egypt is seeking to increase its dependence on renewable energy from 18 percent to 45 percent by 2025, according to Gad, who urged the African states to focus on achieving just transition to renewable energy and providing sustainable energy to the green energy projects in Africa in addition to following up the implementation of commitments which Africa received in previous climate summits.
Africa Fintech Summit Washington D.C. 2022 — Where African and Global Fintech Stakeholders Met in April (Business Insider Africa)
Like every April edition before it, #AFTSDC2022 was scheduled to hold during the World Bank/IFC Spring meeting. This presented the summit with the opportunity to host fintech leaders already in town for the World Bank event alongside attendees billed to be at the fintech summit.
Further, the U.S.-Africa investment relationship meant that a summit in D.C. would connect African entrepreneurs with some of the U.S. investors responsible for 62% of the top twenty investment deals in Africa in 2021.
The main event kicked off with a keynote address by Deniece Laurent-Mantey, Director for Africa, White House Security Council. In keeping with the event’s theme centered around growth and expansion trends in Africa’s fintech industry, Ms. Laurent-Mantey touched on the potential for Africa’s technology industry to thrive in the coming years. In her words, this potential is limitless because “we are in the midst of an unprecedented revolution in the digital technology - one which is impacting every sector of the economy and social life, bringing people and nations closer together, and making the world a true global village.”
Following Ms. Laurent-Mantey’s keynote, various panel sessions took the better part of the day. There were 16 insights-driven sessions focused on fintech hotspots, including embedded finance, investment trends in the industry, web3 and cryptocurrency, diaspora banking and remittances, fintech regulatory best practices, the future of banking, and more.
Global economy news
How digital multinationals are transforming global trade and investment (UNCTAD)
The international production footprint of digital multinational enterprises (MNEs), which was already expanding, has grown even faster during the COVID-19 pandemic. UNCTAD’s Global Investment Trends Monitor published on 27 April unveils new rankings of the top 100 digital MNEs, whose total sales were almost 160% higher in 2021 than in 2016, with an average increase of 21% per year.
Their net income grew by over 60% between 2020 and 2021, in contrast to a flat trend for the traditional top 100 MNEs, excluding those in the technology sector. The top 100 digital MNEs include leading players such as Uber, Twitter and Meta. The report also looks at the impact of the world’s largest digital MNEs on trade and investment. “Digital MNEs can provide a boost to competitiveness across all sectors, new opportunities for business and entrepreneurial activity and new avenues for market access and participation in global value chains,” said James Zhan, UNCTAD’s director of investment and enterprise development.
How digitalization of industries can empower humanity (WEF)
5G can play a pivotal role in transforming industries to be more flexible, productive and sustainable. But the digital evolution will also affect human work – it will create new roles that do not exist today while making working environments safer, smarter and more creative. We should not see automation and digital transformation as a way to replace humans; it is about bringing out the best in humans, in collaboration with machines and algorithms.
DG receives letter from environmental groups seeking global deal on fishing subsidies (WTO)
“The negotiations are at a very critical juncture, as we are just four weeks away from our 12th Ministerial Conference. This is the moment our members cannot afford to miss,” DG Okonjo-Iweala said after receiving the letter addressed to the full WTO membership. “I therefore welcome your letter and your hard work in support of a successful conclusion of the negotiations,” she said. “Your call is an encouragement to deliver on UN SDG 14.6 and the tangible contribution the trading system can make to stop overfishing and help protecting marine life. The fish and the people that live from fish will be very happy.”
DG Okonjo-Iweala calls on LDCs to focus on most pressing priorities for MC12 (WTO)
Briefing ambassadors on the progress made in trade negotiations, DG Okonjo-Iweala said: “A successful MC12 is a necessary step in the long haul towards making the WTO fit for purpose for the 21st century. Delivering results will create a new dynamic for future discussions.” The Director-General talked about the response to the COVID-19 pandemic, agricultural reforms and fisheries subsidies.
Discussions also focused on how to strengthen the WTO to make it more responsive to the needs of LDCs. “As we prepare ourselves for the busy weeks ahead, let us all remember that the WTO is about people — about using trade as a tool to raise living standards, create jobs, and promote sustainable development. So, let’s redouble our efforts, let’s deliver results and let’s reinvigorate the WTO,” DG Okonjo-Iweala said.
UK development strategy panned as ‘aid for trade,’ missed opportunity (Devex)
Many hoped that FCDO’s much-awaited development strategy would provide direction to the United Kingdom’s international policy. But the document is not everything that observers would have liked it to be.
Davos 2022 convenes at a crucial time for Africa (African Business)
The World Economic Forum’s 2022 meeting in Davos, taking place in person for the first time since 2020, has come as a welcome, and timely respite as the world seems to be lurching into yet another crisis, with the war in Ukraine showing little signs of coming to an end. Appropriately, the theme for Davos 2022 is “Working Together, Restoring Trust”. We can only hope that the collective diplomatic skills of the organisation, honed over the decades, will encourage global political, social and business leaders to step back for a while from their own domestic concerns and take a clear and hard look at the state of the world today. In this report we focus on the issues facing Africa as the Forum takes place.
Will Proposed COVID-19 TRIPS Waiver Help Patients or Harm Innovation? (Biospace)
Changes to the World Trade Organization’s compulsory licensing regulations are coming for COVID-19 vaccines. Those changes are unlikely to help people in developing countries but could reduce innovation among biopharma companies and ultimately do more harm than good. A draft of the changes proposed to Article 31 of the Trade-Related Aspects of Intellectual Property Rights (TRIPS) agreements states that WTO member nations: Needn’t contact the patent holder to try to gain authorization to use the patent Can invoke compulsory licensing by multiple means, including executive orders, emergency decrees, government use authorizations and judicial and administrative orders Can export any amount of the product The proposed TRIPS waiver is for COVID-19 vaccines – not just mRNA vaccines. As of March 16, 2022, nine vaccines have emergency use listings, according to the World Health Organization.
”The developing world needs more COVID-19 vaccination and more doses, but the WTO is applying the wrong Band-Aid. This is not an intellectual property issue,” Jürgen Schneider, co-chair of the intellectual property group of BIO Deutschland and VP, head of global IP and licensing at Qiagen, told BioSpace.
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Investing in African Mining Indaba (Mail & Guardian)
The local mining industry is thriving, but infrastructure needs to be improved and changes need to be made for the sector to reach its true potential. This was the message from President Cyril Ramaphosa, who addressed attendees on the second morning of the Investing in African Mining Indaba 2022. “Across the world, most industries have had to adapt to new circumstances, confront new challenges and also prepare to seize new opportunities,” he said. The mining sector in Africa is no exception. Couple this with the benefits and potential risks of rapid technological change, shifts in demand, stresses caused by climate change, as well as massive geopolitical uncertainty, and the industry has a fair amount of work to do to develop and grow.
Diversifying the country’s energy mix demands that the government puts legislation in place to support renewables, minimise the effects of climate change and boost investment in sustainable energy supplies such as wind and solar, he said. In this forward march towards a low carbon future, the president stressed that the country’s efforts have to be both realistic, sustainable and don’t leave anyone behind. “As our reliance on coal reduces over time, it is critical that we create pathways towards new economic activity for affected workers, communities and industries.”
“South Africa plans to focus on future strategic metals like copper, nickel and cobalt. And, as a global leader in platinum group metals, South Africa is perfectly positioned to take advantage of the massive growth in demand for these resources.” The country can also play a key role in the hydrogen economy, and there are plans for it to be an important hub for the production and export of green hydrogen.
But this doesn’t mean that the mining industry should simply say goodbye to many of the minerals that have been the sector’s bread and butter for decades, he cautioned, stressing that the continent should rather protect and preserve its valuable natural resources. “As a continent with such a rich abundance of mineral resources, Africa needs to beneficiate its mineral endowments for the benefit of current and future generations.”
South African wineries set eyes on exploring massive Chinese market (Global Times)
“As a fast-growing market, China can’t be neglected by any winery,” Henriëtte Jacobs, the international sales manager of Spier Wine Farm, told the Global Times, adding that the company’s exports to China have continued to grow exponentially during the recent years, and the Chinese market is becoming one of the company’s most important strategic markets. Jacobs’ remark speaks for multiple wineries from South Africa, who have been adopting various strategies and tactics in a bid to get a slice of the emerging Chinese market.
The exports of Australian wine plunged by 95 percent at the end of 2020 after China imposed anti-dumping measures on the country’s wine exports, causing Australia to forfeit its leading position for wine imports in the massive Chinese market. Industry insiders noted that this could be a potential opportunity for South African wines.
Ford added that China and South Africa are important economies in Asia and Africa with very warm trade relations, while the quality of South African wine enjoys acclaimed reputation in the Chinese market. He hoped that more Chinese consumers will be able to appreciate the unique and high-quality South African wine in the future.
SA facing a sugar shortage with mills unable to meet demand (IOL)
South Africa is facing a shortage of sugar, the new “white gold”, with local mills unable to meet the local demand, Chris Engelbrecht, the chairperson of the Association of Southern Africa Sugar Importers (Asasi), warned. This is a further blow to South Africans, who are facing soaring food prices, exacerbated by supply chain woes due to the war in Ukraine, which has seen countries banning the export of key crops such as palm oil in the face of rampant inflation.
Kenyans urged to tap their potential in online trading (Capital Business)
Kenyans have been urged to tap on their high knowledge levels in online trading to gain maximum benefits from both local and global markets. Speaking to Capital Business, Scope Markets Chief Markets Analyst, James Hughes noted that in his over 20 years experience in the trading industry the Kenyan market base knowledge level in markets is quite high. “The Kenyan retail market is one of the best for us globally with higher knowledge levels than even the United Kingdom for beginners,” he said. Hughes noted that Kenya’s great potential can be seen with the number of licensed online forex traders setting up in the country.
He further noted that the pandemic which saw many people stay at home created a huge appetite for the online trading.
Manufacturers protest new KRA fuel, beer tax powers (Business Daily)
Manufacturers want the proposed powers to exempt excisable goods like fuel, beer and bottled water from annual price raises due to inflation to be taken away from Kenya Revenue Authority to the lawmakers, citing conflict of interest. The Kenya Association of Manufacturers (KAM) in a memorandum to the National Assembly argues the Public Finance Act gives Treasury secretary Ukur Yatani the power to waive taxes with no legal provision to transfer them to KRA Commissioner-General Githii Mburu. The amendments to Excise Duty Act, through the Finance Bill 2022, empowers Mr Mburu to exclude some products from annual inflation tax adjustment based on prevailing economic conditions. “We propose that the power to exempt specific products from inflation adjustment be granted to the National Assembly instead [of KRA Commissioner-General],” KAM’s outgoing chief executive Phyllis Wakiaga wrote in the memorandum on the Finance Bill before the august House.
Kenya’s tax agency works to resolve LPG trucks snarl-up at Namanga (The East African)
The Kenya Revenue Authority has refuted claims that the snarl-up of trucks at the Kenya-Tanzania border town of Namanga is due to an increment of taxes on liquid petroleum gas (LPG), even as the agency as seeks to hasten the resolution of the impasse. The taxman said on Wednesday that the LPG tax was reintroduced by the Kenyan government in July 2021, after being zero-rated in 2016, but had not been increased. Some importers were, however, undervaluing their LPG products to evade tax and have since been issued with notices to comply after which their trucks will be cleared from the border post, KRA said in a statement. “It is also significant to note that the LPG products in question are not sourced from the East African Community Partner States as reported,” read the statement signed by KRA’s Deputy Commissioner for Customs Revenue and Regional Coordination. The tax impasse at the Namanga border post has caused a build-up of transit trucks, some destined for as far as South Sudan. Some of the LPG trucks have reportedly started leaking, endangering the safety of the drivers, residents, and workers in the area.
KRA said it is aware of the inconvenience and security risks caused by the LPG trucks, adding that it is working with the affected importers to resolve the issue.
Kenya moves to secure duty-free trade deal with EU after stalled EPAs talks (The East African)
Kenya has put in place temporary measures for its exports to the European Union after the implementation of a duty free-quota free trade agreement with other EAC member states stalled. Classified as a lower middle income economy by the World Bank, Kenya aims to protect its trade interests with the EU after Tanzania, Uganda and Burundi declined to sign the Economic Partnership Agreement (EPA) citing various economic and political interests. The agreement, whose negotiations were concluded on October 16, 2014, provides for duty free-quota free access for Kenyan and EAC products to the EU market.
“We have the highest decision making organ called the Summit. For the past five years, the Summit has given guidance on the application of the principle of Variable Geometry, which allows trading partners to make certain progress as long as there is concurrence that the others can catch up later,” Johnson Weru, Kenya’s Principal Secretary in the ministry of Trade and Industry, told The EastAfrican last week.
Although Kenya has signed and ratified the agreement, the pact requires all countries to sign and ratify it as a bloc for it to take effect. Uganda, Rwanda, Burundi and Tanzania, which are considered Least Developed Countries, enjoy a preferential trade arrangement with the EU under the Everything but Arms arrangement.
Kenya to import maize outside EAC as flour hits historic high (Business Daily)
Kenya plans to allow maize imports from outside the East African Community to mitigate the current spike in flour prices now at a historic high of Sh150 for a two-kilo packet. Agriculture Cabinet secretary Peter Munya said the imports, which are expected to give consumers a reprieve, will also force farmers hoarding their produce to release it to the market. He said the decision on when the imports would start and volumes to be shipped in would be made in the next couple of days with the consignment expected to arrive in 45 days from the date that the orders would be made. “We are going to run out of maize in the next few months and to control the rising cost of flour, we need to import the produce,” said Mr Munya. This will be the first maize imports from outside of the EAC bloc since 2017.
Besides China, Kenya has other big market options in the East (The Standard)
For the last forty years, China has been getting all the airtime in East Asia. Ever since opening up to the rest of the world in 1978, the country has been a swirling vortex sucking in foreign investors. But unlike a black hole where nothing escapes, China’s exports move all over the world. Did you see the recently released first-ever picture of a black hole? China quickly relaxed its image as a communist state and is now better known for unprecedented economic growth, as the workshop of the world and more recently as the epicentre of the deadly Covid-19. Intoxicated by China, we have forgotten that the East is much more than China. Beyond its popular locations such as the forbidden city, Beijing and Shanghai lie other East Asia countries. Three stand out; the Philippines, Indonesia and Vietnam.
Nigeria’s Foreign Trade Jumps to N11.7trn in Q4 2021 (Business Post Nigeria)
Data on foreign trade revealed that in the last quarter of 2021, Nigeria’s foreign trade stood at N11.7 trillion, 74.7 per cent higher than the value recorded in the same period of 2020. According to the National Bureau of Statistics (NBS) in its Statistics Quarterly Report released in Abuja over the weekend, export trade in Q4 of 2021 stood at N5.77 trillion, 12.27 per cent higher than the preceding quarter and the value in 2021 also grew by 80.52 per cent over the corresponding period of 2020. On the other hand, total imports stood at N5.94 trillion in Q4, 2021, indicating an increase of 11.33 per cent over the preceding quarter and 69.41 per cent over the corresponding period of 2020.
“Export trade by region in Q4 of 2021 shows that Nigeria exported most products to Europe with goods valued at N2,408.39 billion or 41.76 per cent of total exports. “Asia was N1,875.56 billion, or 32.52 per cent of total exports and Africa was N773.83 billion or 13.42 per cent of total exports, of which N250.52 billion worth of goods were exported to ECOWAS countries.
The report revealed that during Q4 of 2021, Nigeria imported goods mainly from Asia, valued at N2,743.76 billion or 46.19 per cent of total imports. “This was followed by Europe at N2,422.41 billion or 40.78 per cent, America at N571.70 billion or 9.62 per cent, Africa at N161.47 billion or 2.72 per cent and Oceania at N41.24 billion or 0.69 per cent.”
FG approves N375bn expansion grant for non-oil export exporters (Businessday)
The Federal Executive Council has approved the sum of N375bn export expansion grant (EEG) to boost non-oil export. Ezra Yakusak, executive director/CEO, of the Nigeria Export Promotion Council (NEPC), who disclosed this during the second edition of the Export4Survival walk at the weekend in Abuja, said about 285 exporters who applied for the EEG will benefit from the fund. According to Yakusak, the approval also means that the backlog from 2006 till date has been cleared and “exporters should expect the N375 billion approved by FEC. Right now, it would be taken to the national assembly for assent.”
In addition to the grant, the executive director informed that the NEPC will introduce some initiatives to also encourage non-oil export. He informed that the commission is about to set up a project called ‘exporters handholding’ aimed at conducting physical training for new non-oil exporters, who newly registered with no knowledge about export. “We are going to match-make them with exporters to train them on the physical aspect of non-oil export; the rudiments, the procedures, to ensure that they export,” he added.
Port development: NPA to revoke concession agreement of 5 terminal operators (The Sun Nigeria)
The Nigerian Ports Authority (NPA) over the weekend has threatened to revoke the concession agreement of five terminal operators over a lack of commitment towards the development of the port terminals they operate in, even as the ports are collapsing. According to the Managing Director of the NPA, Mr. Mohammed Bello-Koko, five terminal operators are being monitored to ensure they do the right things as regards their commitment and obligations under the Port Concession agreement.
Nigeria Spends 86% Of Revenue On Debt Servicing (Economic Confidential)
Nigeria spent 86 per cent of its revenue on servicing debt in 2021, but South Africa spent only 20 per cent of its receipts on the same purpose.
According to the International Monetary Fund’s 2021 Article IV estimates, Africa’s most populous nation spent 85.5 per cent of its revenue on servicing the debt in 2021. On the other hand, South Africa’s budget office, situated in the National Treasury, estimated its debt service-to-revenue in 2021 at 20 per cent, explaining that for every five rand raised by the government, only one rand was spent on servicing debt. Nigeria’s total debt by end of December 2021 was only 30 per cent of South Africa’s debt, yet the former’s debt service appears too expensive, according to analysts. Nigeria’s total debt as at December 2021 was $94.166bn, according to the Debt Management Office, but South Africa’s total debt at the same period was $261bn, according to the country’s National Treasury and Bloomberg.
Nigeria is the continent’s largest economy. Latest estimates by the National Bureau of Statistics put the nation’s economic size at $420bn. On the other hand, South Africa is second largest economy on the continent with an estimated size of $320bn.
Central African Republic Economic Memorandum: Paving the way out of fragility for a brighter future (World Bank)
The Central African Republic (CAR) is at a critical crossroads. Despite its significant natural resources’ wealth, it remains one of the poorest and most fragile countries in the world. Cycles of political instability and a heavy reliance on natural resources have left the economy poorly diversified and with a small private sector. Almost a decade after the 2013 civil war, the country remains caught in a fragility trap, facing episodes of renewed insecurity and a substantial state-citizen divide. Supported by the 2015 peaceful transition of power, the authorities implemented several reform programs that helped restore macroeconomic stability and steered the economy on to a relatively sustainable path to recovery over 2015–2019.However, the pace of growth has been below that of other countries in the region that have had civil wars and been threatened by overlapping crises since 2020This Country Economic Memorandum (CEM) aims to support policymakers and stakeholders in their efforts to pave the way out of fragility through accelerated and inclusive economic growth through four chapters providing:
Somalia govt requests three-month extension of IMF facility to August 17 (The East African)
The Somalia government has asked the International Monetary Fund to delay its cut-off deadline on a key credit facility after the country failed to conduct elections on time. Finance Minister Abdirahman Duale Beileh and Governor of the Somali Central Bank Abdirahman Mohamed Abdullahi asked the IMF to extend the deadline by three months to August 17.
On March 25, 2020, Somalia was granted the ECF, which the IMF Board routinely approves for countries with protracted balance of payments problems. It is meant to support low-income countries, especially those emerging from conflict but are heavily indebted. The programme was part of the Heavily Indebted Poor Countries (HIPC) Initiative, which would cut the country’s debt to $557 million from $5.2 billion, as long as it completed certain reforms including taming corruption, raising local revenues and passing laws on good governance.
African trade
The Agreement Establishing the African Continental Free Trade Area officially became operational in 2021, making it the cornerstone of trade integration in Africa. The objectives of the Area are to create a single, continent-wide market and to enhance competitiveness at the enterprise level. The African Continental Free Trade Area Country Business Index is the first comprehensive tool based on a robust methodological framework in which data are collected in a way that allows businesses to express their views on implementation of the Area. Following the launch of the Index in 2018, the Economic Commission for Africa began piloting and refining it as a tool to measure and compare the views of businesses across Africa on implementation of the Area. The figure below shows the countries selected for the three phases of the pilot study. After phase 1, which was conducted in Cameroon and Zambia, the methodology was refined and surveys were conducted in seven more countries: Angola, Côte d’Ivoire, Gabon, Kenya, Namibia, Nigeria and South Africa. The present report includes results from this second phase of the roll-out. In the third phase, the Index will be rolled out in the Democratic Republic of the Congo, Egypt, Morocco, Rwanda, Senegal and Tunisia.
The disruptions caused by the COVID-19 pandemic pushed an estimated 55 million Africans into extreme poverty in 2020 and reversed more than two decades of progress in poverty reduction on the continent. This is according to the Economic Report on Africa 2021 (ERA2021) launched today on the margins of the Economic Commission for Africa’s annual Conference of Ministers of Finance, Economic Planning and Development (CoM2022) in Dakar, Senegal.
At CoM2022, experts address effects of Russia-Ukraine crisis on Africa
Commodities coming into African ports have little or no visibility (Logistics Update Africa)
The last week of April saw the Lagos-headquartered OnePort 365 raking in $5 million through its seed funding. The funds will be channelled to fuel OnePort 365’s plans to drive the end-to-end digitisation of freight management in Africa and support expansion into new markets across the continent. In OnePort 365’s own words, the company works to “leverage technology to drive your supply chain and business objectives.”
“What comes along with the expansion of e-commerce is a growing demand for distribution and warehouse management services. The service providers with a well-established local network will be particularly in need of facilitating last-mile delivery, which also provides local e-commerce marketplaces and retailers certain advantages in comparison with international e-commerce players. Furthermore, the expansion of the e-commerce market, especially cross-border e-commerce, can transform some areas into regional distribution hubs”
Citing a World Bank report, Upply comments, “According to World Bank’s analysis, the AfCFTA will boost intra-continental exports by over 81% and exports with non-African countries by 19% by 2035. In terms of sectors, manufacturing exports are anticipated to make the most gains: a 110% increase for intra-African trade and 46% for non-African trade. In contrast, service trade is envisaged to have the most modest rise (14% of intra-African trade).”
As for the digital enablement, an African Union report entitled, pdf The Digital Transformation Strategy for Africa (2020-2030) (1.80 MB) , expresses optimism when it comes to Africa’s digital era, “Africa presents a sea of economic opportunities in virtually every sector.”
The biggest challenge in Africa in terms of air cargo is connectivity (Logistics Update Africa)
Swissport Kenya’s CEO, Racheal Ndegwa speaks with Zinal Dedhia of Logistics Update Africa.
Q: I would like you to briefly talk about the air cargo market in East Africa, particularly Kenya
A: Africa’s air freight market contributes 1.9% of the world’s air freight traffic, according to the IATA 2021 statistics. For me, this percentage represents a great opportunity for growth of Swissport in Kenya and beyond. I believe the challenge we are facing in Africa in terms of air freight is connectivity – we must increase intra Africa traffic to allow more efficient and fluent air transport. With the launch of African Continental Free Trade Area (AfCFTA) and new trade flows that have emerged since the onset of the pandemic (eCommerce, PPE movement, vaccines), Africa is primed for a “very high level of growth” within the coming years. This will enable the intra African markets to develop, as currently only about 30% of the continent’s trade is accomplished internally. The enhanced trade will have a positive impact on all industries, including aviation and specifically air cargo.
ICCI for focusing on Africa to promote trade and exports (The Nation)
Muhammad Shakeel Munir, President, Islamabad Chamber of Commerce and Industry (ICCI) said that Africa is a huge market, which still remains untapped and urged the government to focus on African countries to boost its trade and exports. He said this while exchanging views with the Deputy Head of Missions of Morocco, South Africa and Nigeria during their visit to ICCI. Muhammad Shakeel Munir said that Pakistan has formulated the ‘Look Africa Policy’ which should be fully implemented to improve trade relations with African region.
He said that Pakistan has good potential to export many products to Africa including rice, engineering goods, electrical appliances, textiles, apparel, pharmaceuticals, sports goods, surgical instruments, cutlery, furniture and many more. He said that Pakistan can import many products from African countries that offer competitive advantage for import.
Ghanaian Finance Minister Ken Ofori-Atta on Thursday emphasized the nation’s partnership with the African Development Bank in its development as he addressed journalists at a press conference to publicize the institution’s upcoming annual meetings. Ofori-Atta described the meetings as seminal, in the context of a world seeking to rebalance in the wake of Covid-19 and the war in Ukraine. “The hosting is long overdue. Forty-one African economies are severely exposed to at least three concurrent crises – rising food prices, rising energy prices and tightening financial conditions – what finance ministers now call the dreaded three f’s,” Ofori-Atta said. Throughout Africa food prices are currently around 34% higher, crude oil prices 60 % and global inflation is affecting all countries, the minister said, with inflation in Ghana standing at around 23.6%.
“The newly poor in Africa has increased by 55 million and approximately 35 million formal jobs are at risk,” the minister said. “This toxic mix of challenges exist even as we try to recover from the Covid-19 pandemic.”
ICPC boss seek global action against illicit financial flows (Daily Sun)
The Chairman of the Independent Corrupt Practices and Other Related Offences Commission (ICPC), Prof. Bolaji Owasanoyejj, has rallied a global action against Illicit Financial Flows (IFF), including a call for a global framework on IFFs similar to corruption. Owasanoye made this call at a side event of the ongoing hybrid 54th Conference of the United Nations Economic Commission for Africa (UNECA) taking place in Dakar, Senegal.
“The challenge we found ourselves today is that the rules have always been skewed in favour of those who export capital and against those who import capital. Corruption is a global issue and we have a global framework on corruption.
Renewed push for use of Kiswahili by AU and UNESCO (Modern Ghana)
The renewed push for Kiswahili to become a lingua franca in Africa promises to benefit the continent and the world. The effort is set to reduce Africa’s reliance on foreign languages in official communications, lead to the recognition and spread of Kiswahili, and promote Pan-Africanism. The campaign, however, faces a number of challenges. According to experts, supplanting them could create diplomatic challenges.
For Kiswahili to gain acceptance and develop in such regions, adequate resources and political goodwill — including financial and economic inputs — are imperative to ensure it will serve people as well as, if not better than, the languages they speak today.
Commonwealth Africa Explores Ways of Combating Corruption (InDepthNews)
The 12th Regional Conference of Heads of Anti-Corruption Agencies in Commonwealth Africa convened in Kigali, Rwanda, from May 3-7 under the theme: ‘Combating Corruption for Good Governance and Sustainable Development in Africa’. The Conference was jointly organised by the Commonwealth Secretariat and the Government of Rwanda and brought together members of the Association of Anti-Corruption Agencies in Commonwealth Africa, senior government officials, relevant international organisations, policymakers, and development partners to address key priorities toward the achievement of Sustainable Development Goal 16. They shared knowledge and good practices and discussed the impacts of corruption on sustainable development in Africa and innovative approaches in the fight against corruption.
Over the years, corruption has been an unerasable characteristic feature of African politics and business, from the Maghreb down to the Southern African Development Community, from the East African Community and the Horn of Africa across the Sahel region to the Atlantic coastal West African States.
Most African countries have ratified African Union Convention on preventing and combating corruption and other international legal instruments on corruption. As required by international obligations, African countries have enacted national anti-corruption laws and established anti-corruption institutions. Almost every African country has a specialised anti-corruption agency to address specific crimes and malpractices including illicit flow, money laundering, embezzlement, and conflict of interest among others.
Africa needs tech, innovation to improve output (Monitor)
The Second Africa-wide Conference on Science, Technology and Innovation (STI) recently held in Kigali, Rwanda, concluded with an urgent call for African governments, regional economic communities and continental organs including, the African Union, African Development Bank, and United Nations Economic Commission for Africa to sustain the recognition of the role and importance of STI in socio-economic advancements.
The meeting also intensified calls for African states to ensure integration of STI in their respective development frameworks while reiterating the centrality of science and technology in socio-economic development including, transformation of rural livelihoods on the continent.
While African governments have often times reiterated the role of STI in the transformation of agricultural sector as an imperative engine to the continent’s survival and growth, the process has been slow amid continuous and emerging challenges. Post Covid-19 and out of these calls, evidence of new challenges have emerged and with them, opportunities to mitigate namely; efficiency, resilience, digitisation, agility and sustainability.
African technology startups scoop $2b funding (The East African)
Kenya ranks among Africa’ four biggest destinations for tech start-up funding after Nigeria, Egypt and South Africa. The African Tech Startups Funding Report (2021) shows that last year in the African tech start-up ecosystem, 564 businesses raised $2.14 billion in funding, the bulk of which took place in the “big four” markets – Nigeria, Egypt, South Africa and Kenya. According to the report the “big four” start-up destinations raked in a combined $1.97 billion over the course of the year, accounting for 92.1 per cent of the overall total funding. Ghana, Morocco and Tunisia start-ups secured more than 40 per cent of the remaining $170.6 million.
According to the report the number of investors in the African tech start-ups sector has been growing exponentially, with the number of new investors joining the business more than doubling to 771 in 2021 from 370 in 2020.
How Africa’s tech sector can thrive – and it’s not all about legalising Bitcoin (Euronews)
Speculation over which country would be the next to adopt Bitcoin as an official currency has largely centred on Central and South America, following El Salvador’s move seven months ago to become the first country to make the cryptocurrency legal tender. It would actually be the Central African Republic (CAR) that became the second country to vote in favour of adopting it – but it may be that the rest of the continent has the most to gain from cryptocurrency. One of the ways crypto can help CAR is that it can offer financial services to the vast majority of the population who are “unbanked”.
“The objective of Bitcoin and cryptocurrency is to cause disruption,” said Lacina Koné, Director General and CEO of Smart Africa, a pan-African institution endorsed by the African Union. The group works to enhance the digital landscape in Africa and works with the private sector and governments. It is also the brainchild of Rwanda’s president Paul Kagame.
Central African bank regulator reminds states of crypto ban (Reuters)
Central Africa’s regional banking regulator sent out a reminder on Friday about its ban on cryptocurrencies, weeks after the Central African Republic, a member state, made bitcoin legal tender. The Banking Commission of Central Africa (COBAC), which regulates the banking sector in the six-nation Economic and Monetary Community of Central Africa (CEMAC), said the prohibition was meant to ensure financial stability. The announcement came as cryptocurrencies nursed large losses on Friday after the collapse of TerraUSD, a so-called stablecoin, rippled through markets.
The Central African Republic’s presidency announced on April 27 that bitcoin had been made legal tender, making it only the second country to do so after El Salvador. read more At the time, analysts and crypto experts said they were puzzled by the move in one of world’s poorest nations where internet use is low, conflict is widespread and electricity is unreliable. The government has provided few details about its reasoning and questions remain about implementation.
Food insecurity becoming more prevalent in African countries, according African Union (SABC News)
The African Union Peace and Security Council (AUPSC) says it is concerned about the increase in food insecurity in Africa, especially in countries where conflict persists. The AU says prolonged fighting is affecting food production and many countries are failing to effectively feed their citizens. The situation has also been worsened by the effects of climate change. The African body says starvation levels on the continent are on the rise. The United Nations Food and Agriculture Organisations says there are over 280 million food-insecure people in Africa. The AUPSC is concerned that conflicts in parts of Africa are becoming a major root factor of starvation in the continent.
A report by the Food and Agriculture organisation, the World Food Programme identifies Ethiopia, Nigeria and South Sudan at high alert levels of food insecurity. Part of the reason for insufficient food supply in these countries is conflict.
The Joint Meeting of Ministers Responsible for Agriculture and Food Security, Fisheries and Aquaculture from the Southern African Development Community (SADC) was held on 13th May, 2022 at Bingu International Convention Centre (BICC) in Lilongwe, Republic of Malawi.
The objective of the meeting was to consider and review implementation of policies and strategies aimed at advancing the agriculture and food and nutrition security, fisheries and aquaculture production and productivity in the Region. The meeting took place against the backdrop of excess rains, which caused heavy flooding in some parts of the Region, cyclones and drought in others; outbreaks of transboundary animal and plant pests and diseases; major disruptions to supply chain and services due to the COVID-19 pandemic, rising inflation and record public debt that is constraining many countries’ ability to address the current socio-economic challenges and also the global food insecurity situation caused by the conflict between Russia and Ukraine.
Africa roundtable unites with European allies (DW)
Politicians from African and European countries gathered in Berlin on Thursday for The Africa Roundtable to discuss strategies to cope with common challenges. “We are in times of multiple crises and partnership in these days is more important than anything else,” said Ingrid Hamm, cofounder and CEO of event organizer Global Perspectives Initiative (GPI), in her opening remarks.
In his televised opening speech, Germany’s food and agriculture minister, Cem Özdemir, mentioned some of the current challenges facing Europe and Africa as a result the war in Ukraine — especially a lack of wheat imports from Ukraine and Russia. Shortages of food are happening at a time that ”around 280 million people in Africa are already undernourished today especially in the Sahel and the Horn of Africa due to severe draught and conflicts,” explained Özdemir.
Senegal’s economy minister, Amadou Hott, said in his keynote address that some African nations are not in a good position to deal with some economic challenges because of international issues. For example, he mentioned some of the bottlenecks faced by Africa in raising money from the capital markets in order to deal with the COVID pandemic and the war in Ukraine.
“Our economies together in terms of GDP we are the eight largest in the world, thus we deserve the seat at the table specially to give inputs when decisions are made that will impact Africa,” said Hott. The idea of including African countries at the G20 table was echoed by Professor Jaffrey Sachs, president of the UN Sustainable Development Solution Network. “Africa needs to be at the table and not as an invited guest politely present, but as G21st country,” said Professor Sachs.
Global economy news
DG Okonjo-Iweala shares views with international agency heads on key issues ahead of MC12 (WTO)
The Director-General attended the spring session of the United Nations Chief Executives Board (CEB) for Coordination in Vienna on 12 May 2022. This is the first time that the UN Secretary-General, António Guterres, who chairs the Board, convened an in-person session of the CEB since the start of the COVID-19 pandemic. The CEB meeting in Vienna was an opportunity for the DG and her counterparts to exchange views on global challenges and their possible solutions. During a conversation on the state of the world, DG Okonjo-Iweala pointed to the ongoing crises in international security, food, environment and climate, public health, and the world economy. She noted that the WTO had had to downgrade its trade forecast, with merchandise trade volumes now projected to grow 3% in 2022, compared to the 4.7% forecasted last October. Despite the economic and political headwinds facing trade, the DG said that “trade is very much part of the mix of policy solutions required to deliver the equitable growth, job creation, and environmental sustainability people around the world need.”
Global conference in Accra: Making the shift to sustainable trade (ITC)
Trade and investment promotion organizations around the world will meet in Accra on 17-18 May to explore Bold Solutions for Resilience and Recovery, the theme of this year’s conference. Firms that are more resilient to crisis often tap the services of these national trade bodies to build resilience to carry them through challenging times. The 2022 World Trade Promotion Conference (WTPO) will be hosted by the Ghana Export Promotion Authority (GEPA) and the International Trade Centre (ITC), a development agency of the United Nations and the World Trade Organization that connects small business to global markets. It brings together 200 leaders of national trade promotion organizations from around the world.
‘Good trade can drive socio-economic recovery that is inclusive and sustainable,’ says Pamela Coke-Hamilton, ITC Executive Director. ‘Trade promotion organizations can make all the difference in helping companies achieve good trade. They must help businesses to mitigate risks and embrace opportunities of a green transition. They must help women, youth and vulnerable groups join global value chains, and overcome systemic barriers that keep them from developing their businesses for export.’
India says open to exporting wheat to poor nations despite ban (Premium Times Nigeria)
The world’s second largest producer of wheat, India, has banned wheat exports, at a time the Russian invasion of Ukraine crippled the supply of the crop across the globe. India announced the ban on Saturday saying it exempted exports backed with letters of credit and countries requesting on the basis of food security. The ban is aimed at controlling rising domestic prices. The government was targeting record shipments this year, but heatwave reduced output and caused a rise in domestic prices. On Sunday, India’s Commerce Secretary B.V.R. Subrahmanyam said the government will allow private companies to meet previous commitments until July and will keep a window open to export wheat to needy countries, the Times of India reported.
The country initially planned to export 10 million tonnes of wheat this year. India exported a record 1.4 million tonnes of wheat in April and was set for another 1.5 million tonnes in May.
Global diamond trade fractures under the weight of Russia sanctions (Moneyweb)
Russia’s invasion of Ukraine is fracturing a billion-dollar trade that spans the permafrost-laden diamond mines of Siberia, secretive trade houses in Antwerp, dusty polishing powerhouses in India and New York’s glittering designer jewelry stores.
“Diamonds are not like oil, where some other country can jump in to make up for a shortfall,” Shah said. “No new mines are coming up elsewhere. Our dependence is huge.” Gems and jewelry are India’s third-largest source of export revenue, pulling in about $39 billion for the fiscal year that ended in March.
A delegation from Alrosa visited India last month and met customers and trade groups to discuss selling diamonds using that workaround, people familiar with the matter said. But talks were inconclusive, the people said, and officials remain sensitive to provoking the US, which sees India as a regional check on China’s power. Alrosa declined to comment. Amitendu Palit, a senior research fellow in South Asian studies at the National University of Singapore, said India faces a “tough, complicated balancing act” in managing “pro-Russia and pro-rest of the world stances.” American commerce secretary Gina Raimondo has likened a ruble-rupee arrangement to “funding and fueling and aiding President Putin’s war.” “Challenges are likely to increase if the conflict continues for a long time,” Palit said. “There will be tacit pressure on India to shift away from Russia for its trade.”
COVID-19 Challenges Highlight the Need to Revive Economic Integration: APEC (Tempo)
There is no better time than now for APEC members to revive work on integrating the Asia-Pacific and bringing new energy to the long-term prospect of a Free Trade Area of the Asia-Pacific (FTAAP).The APEC Policy Support Unit made the statement in a new policy brief. “The pandemic and the aftermath of COVID-19 have only stressed the significance of regional economic integration,” director of the APEC Policy Support Unit, Denis Hew, said, according to a release issued by the APEC Secretariat and received here on Saturday. “APEC policy makers need to address emerging trade-related issues and challenges in order to realize deeper regional economic integration,” Hew argued.
“Most importantly, any regional integration scheme, including free and/or regional trade agreements, could assist to overcome pandemic-related challenges,” Kuriyama added. The report identifies six main challenges affecting trade that are deemed most critical, namely disruption in accessing essential goods, disruption in trade in services, difficulties in supply chain logistics, digital transformation, transparency, and regulatory bottlenecks affecting trade in essential goods. While some of these disruptions were far more severe during the first stage of the pandemic, the challenges persist.
The global economy could increase by more than $140 trillion a year[1], or 1.5 times the annual global GDP, if the objectives of the United Nations Convention to Combat Desertification (UNCCD) are achieved, participants heard during a side-event at the 15th summit of the UNCCD. Camilla Nordheim-Larsen, Senior Partnerships and Resource Mobilization Coordinator at the UN Convention, noted that action in the land sector has the potential to generate up to $140 trillion a year and create 400 million new jobs, while failure to act can result in losses in the range of $44 trillion. The Sustainable Development Goal for Life on Land is least funded, but can contribute most to resilience, she said, speaking at an event on innovative finance mechanisms for sustainable landscapes, hosted by the African Development Bank and partners.
G7: FAO puts forward proposals to address current and future food shortages (FAO)
The head of the Food and Agriculture Organization of the United Nations (FAO) today called on G7 nations to help anticipate future food shortages, as the war in Ukraine squeezes supplies, pushes prices to record highs and threatens already vulnerable nations across Africa and Asia.”We need to actively identify ways to make up for potential future gaps in global markets, working together to foster sustainable productivity increases where possible,” Director-General Qu Dongyu told G7 Agriculture Ministers meeting in Stuttgart, Germany.
“It is in this dramatic context that we now face the war in Ukraine,” Qu said.Russia and Ukraine are important players in global commodity markets, and the uncertainty surrounding the conflict has caused prices surges, particularly of wheat, maize and oilseeds, as well as fertilizers. These increases come on top of already high prices driven by robust demand and high input costs as a result of the COVID-19 pandemic.
Countries that are heavily reliant on wheat imports include Egypt and Turkey, but also a number of Sub-saharan countries such as Congo, Eritrea, Madagascar, Namibia, Somalia and Tanzania. Meanwhile, countries that are heavily dependent on fertilizers imported from Russia include key cereal and high value commodity exporting countries like Argentina, Bangladesh and Brazil.
Climate-vulnerable countries gain resilience through disaster risk finance and insurance (UNDP)
In 2021, economic losses from disasters caused by natural hazards totalled almost US$270 billion. The impact of disasters can significantly undermine development progress and push communities deeper into poverty, making them less resilient to the next disaster shock. Recognizing the importance to plan and finance disaster response, UNDP’s Insurance and Risk Finance Facility (IRFF), a flagship initiative within its Sustainable Finance Hub, we are working together with our government partners to better protect vulnerable communities from socio-economic, climate and health-related disasters by significantly increasing the role of insurance and risk financing in development.
Yet, for many Least Developed Countries (LDCs) and V20 climate-vulnerable countries, insurance solutions remain out of reach. Mechanisms to rapidly mobilize finance for disaster response are often not integrated into budget processes and development plans, insurance companies are deterred by restrictive legislation, demand for insurance is also low due to a lack of awareness and/or trust in the insurance sector, there are also issues related to affordability of premiums. Together, these challenges result in a large protection gap, leaving vulnerable communities exposed to disaster risks and their lives and livelihoods unprotected.
Global GDP could gain $140trn if ... – UNCCD (Tribune Online)
The global economy could increase by more than $140 trillion a year or 1.5 times the annual global GDP, if the objectives of the United Nations Convention to Combat Desertification (UNCCD) are achieved, participants heard during a side – event at the 15th summit of the UNCCD.
Camilla Nordheim-Larsen, Senior Partnerships and Resource Mobilisation Coordinator at the UN Convention, noted that action in the land sector has the potential to generate up to $140 trillion a year and create 400 million new jobs, while failure to act can result in losses in the range of $44 trillion. Speaking at an event on innovative finance mechanisms for sustainable landscapes, hosted by the African Development Bank and partners, she said, the Sustainable Development Goal for Life on Land is least funded, but can contribute most to resilience,
“The benefits of taking action against land degradation largely outweigh the costs of sustainable landscape management. In Sub-Saharan Africa, it is by at least seven times. Inaction costs Sub-Saharan countries $490 billion per year, while according to the Economics of Land Degradation Initiative, action to reverse land degradation could generate benefits worth up to $1.4 trillion,” said Luc Gnacadja, former Executive Secretary of the UN Convention to Combat Desertification and former Minister of Environment of Benin, currently acting as a Co-Chair of the Adaptation Benefits Mechanism Executive Committee.
Rishabh Khanna, Chief Impact Officer at Earthbanc and a steering committee member of the Initiative of Land, Lives and Peace, presented a new initiative launched together with the UN Convention at the summit — digital sustainable land bonds, which allow carbon buyers to purchase at an earlier stage of development. The Adaptation Benefits Mechanism, piloted by the African Development Bank between 2019 and 2023, certifies and monetizes the environmental, social, and economic benefits of adaptation actions, including sustainable and resilient landscapes.
The impact of Russia’s invasion of Ukraine on food and energy supplies will be long-lasting, experts say (Business Insider Africa)
In the months since Russia ordered troops into Ukraine, a flurry of sanctions issued by Western countries has failed to curb the military assault. With a drawn-out conflict appearing more likely, the political determination to punish President Vladimir Putin’s nation suggests a prolonged period of sanctions lies ahead. Some experts say that the prospect of continued disruption to food and energy supplies as a result of the war will trigger a search for long-term alternatives to Russian imports. While the price shock of the conflict is felt globally, the disruption to energy supplies is most keenly felt in the European Union (EU), which sources a quarter of its oil imports and 40% of its natural gas from Russia (the US, by comparison, got about 3% of its crude oil from Russia in 2021). In its sixth round of sanctions against Moscow, the EU announced plans for a total ban on Russian oil and refined product imports by the end of the year.
While shifting away from Russian oil may prove difficult, Europe’s reliance on Russian natural gas provides policymakers and central bankers with a much bigger headache. In a recent round of sanctions, theEU continued to exclude any embargo on natural gas, although it has aired proposals to cut demand for Russian imports by two-thirds by the end of 2022.
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All at sea over the Russian crude oil headed to SA, except copper-bottomed Transnet Port Authority (Daily Maverick)
A Liberia-flagged tanker carrying crude oil from Russia, which was hit by widespread sanctions for its invasion of Ukraine on 24 February, is expected at Saldanha Bay harbour on Sunday. By all accounts, it may just be an R&R break for the Elandra Denali. Or it might be a pit stop on a more complicated route to sidestep tightening sanctions imposed against Russia — from oligarchs to oil. But the arrival of a vessel carrying crude oil from a country under sanctions (Russia) at a South African port, puts into sharp relief domestic policy scurvy. This comes at a time when South Africa’s officially proclaimed neutrality on what the government usually calls a “conflict” has incurred significant criticism. Without at least a view on how to respond in global geopolitics and trade, South Africa seems to be flailing.
As to a policy on accepting vessels with cargo from sanctioned countries, the Transnet Port Authority Saldanha’s response also was crisp: “We follow directives from the government, if any stance [is] taken.” But then it got all fuzzy trying to discover if the government had a policy on dealing with vessels, goods and such from a sanctioned country.
Cabinet welcomes major investment milestones (SAnews)
Minister in the Presidency, Mondli Gungubele, says Cabinet has welcomed the fruition of major investments and achievements made by local and international companies in the country. He was on Thursday briefing media on the outcomes of the Cabinet meeting held on Wednesday. “South Africa welcomes investments into our country and is committed to creating favourable conditions for inclusive growth and transformation of the economy,” Gungubele said.
Manufacturing output down 0.8% year-on-year in March (Stats SA)
Manufacturing production decreased by 0,8% in March 2022 compared with March 2021. The largest negative contributions were made by the following divisions: motor vehicles, parts and accessories and other transport equipment (-11,3% and contributing -1,3 percentage points); and food and beverages (-2,6% and contributing -0,6 of a percentage point). The petroleum, chemical products, rubber and plastic products division (4,1% and contributing 0,9 of a percentage point) was a significant positive contributor.
The largest contributions were made by the following divisions: petroleum, chemical products, rubber and plastic products (7,6% and contributing 1,6 percentage points); food and beverages (5,0% and contributing 1,2 percentage points); basic iron and steel, non-ferrous metal products, metal products and machinery (5,7% and contributing 1,1 percentage points); and motor vehicles, parts and accessories and other transport equipment (10,6% and contributing 1,0 percentage point).
LP Gas strategy approved for implementation (SAnews)
Cabinet has given the go ahead for the implementation of South Africa’s Liquefied Petroleum Gas (LP Gas) Strategy to be implemented. This was announced on Thursday by Minister in the Presidency, Mondli Gungubele, during a briefing on the outcomes of Wednesday’s Cabinet meeting.
The strategy – when implemented – is expected to bring some relief to the country’s constrained energy supplies. “The strategy seeks to expand the LPG industry in the country. LPG will contribute meaningfully to the diversification of sources of energy.
“The strategy will amongst other interventions to regulate the pricing in the value chain, and support the manufacturing of LPG cylinders in the country. It will also educate the public about the benefits of using LPG as an alternative form of energy,” Gungubele said.
Minerals Council of SA reveals priority interventions for mine safety (EWN)
The Minerals Council of South Africa said that it was implementing eight priority interventions to arrest the regression in mine safety in the country.
The number of deaths recorded so far in the industry has raised alarm, more so among trade unions that blame mining companies for the fatalities.
This comes just as the industry was beginning to see the results of its “zero harm” strategy that was implemented when the figure surpassed 100 around 2009 and 2010. The mining council’s Roger Baxter: "The first one is visible felt leadership, the second one is stopping unauthorised and uncontrolled access to old mining areas which are not routinely mined and to rigorously and effectively conduct what we call proper risk assessments and implement controls where work in previously mined areas is routinely undertaken."
Agri SA welcomes ‘balanced’ Agri Masterplan (Engineering News)
Industry body Agri SA says the signing of the Agriculture and Agro Processing Masterplan (AAMP) by Agriculture, Land Reform and Rural Development Minister Thoko Didiza on May 12 has marked the culmination of years of negotiation and consensus building throughout the sector. Agri SA also deems the officiating of the plan testament to the sector and government’s shared commitment to the success and growth of agriculture.
Global agencies called to support vaccine manufacturing in Africa (SAnews)
President Cyril Ramaphosa has called on global agencies to assist in boosting the local manufacturing and production of COVID-19 vaccines by procuring vaccines and boosters from African manufacturers.
More countries pledge to increase trade with Zim (The Herald)
President Mnangagwa’s engagement and re-engagement policy, premised on trade and investment, continues to bear fruit as more countries come on board pledging their businesses’ commitment to invest in the country. Yesterday, four incoming Ambassadors presented, separately, their letters of credence to President Mnangagwa at State House in Harare, and their message as they departed his offices was the same – “increasing trade and investment with Zimbabwe”. This is one of the clearest signs of the success of the engagement and re-engagement policy, which also comes along with the Ministry of Foreign Affairs charged with the added responsibility of International Trade.
New Singapore Ambassador to Zimbabwe Mr Zainal Arif Mantaha said there is a lot of potential for growth in the relations between the two countries. Ms Ofra Fahri, the incoming Israeli envoy to Zimbabwe, said she will be building on the already existing good relations between the two countries to deepen trade and investment.
Vietnam, one of the world’s fastest-growing economies with a GDP of US$271 billion, was also represented by its new Ambassador, Mr Hoang Van Loi, who said his country is ready to take part in the country’s economic development. On his part, Mr Murad Baseer, the new Pakistani Ambassador to Zimbabwe, also echoed similar sentiments.
US trade lobby group slams Biden’s delay to seal Kenya deal (Business Daily)
The United States Chamber of Commerce has hit out at President Joe Biden administration’s perceived delay in concluding a new trade deal with Kenya, which was initiated by his predecessor Donald Trump more than two years ago. Terming the Kenya deal as a low-hanging fruit that ought to have been concluded by now, the lobby, which is the biggest and most influential US business group, accused the Biden administration of dilly-dallying in signing the pact. “While other economies race to ink new deals, the US has not entered an agreement with a trade partner in a decade,” said chamber’s president Suzanne Clark in an update.“ And the current administration consumed by caution and internal reviews is doing little to change that. In fact, it is yet to pick even the lowest hanging fruit such as trade agreements that were already underway with the UK and Kenya, some of our closest allies.”
Her remarks also come as US rivals like China and Japan are seen to shape trade practices across the globe including in Kenya. There has also been growing unease in Nairobi about the Biden administration’s delay in concluding the free trade agreement with Kenya.
Nairobi is keen on signing a new trade deal with Washington before the expiry of the current arrangement under the Africa Growth and Opportunity Act (Agoa), which allows sub-Saharan African countries to export thousands of products to the US without tariffs or quotas until 2025.
Boost for tourism as local firms launch bid to promote Kenya across East Africa (Capital FM Kenya)
Kenya’s tourism will soon receive a shot in the arm after local firms launched a campaign to promote the country as a tourism destination within the East African region. The campaign dubbed “Tembea Tujenge Afrika Mashariki” is aimed at promoting intra and inter-regional tourism as a way of reviving economies of East Africa Community member States post the COVID-19 pandemic which ravaged the tourism sector globally due to travel restrictions.
Tembea Tujenge Kenya Ambassador Maina Kageni has said the road map for the East Africa tour will flow from Uganda, DRC Congo, Rwanda, Tanzania and finally Zanzibar. “The new regional tourism campaign is aimed at sourcing for and market multi-country packages through local influencers in each country to showcase simulated experiences,” said Maina.
“We are ready to market Kenya to the rest of the EAC member States as a way of promoting our tourism sector which is now recovering well after the COVID-19 pandemic negatively affected the sector. So far the “Tembea Tujenge Kenya” has covered 37 Counties for the last two years and we are expected to visit all the counties by the end of 2022,” stated Isuzu East Africa Communications Manager Duncan Muhindi.
Central bank: Economy maintained recovery path in first quarter of 2022 (The New Times)
Rwanda’s economy maintained strong growth in the first quarter of this year, the central bank said on Thursday, reflecting sustained recovery from the 2020 Covid-19-induced contraction. A combination of policy initiatives including massive Covid-19 vaccination that led to a large scale opening of the economy as well as the central bank’s accommodative monetary policy supported the improvement of economic activity, the Bank said.
The strong economic performance was driven by services and industry sectors linked to the full reopening of the economy and government initiative that is supporting the manufacturing and other infrastructure projects.
On the basis of trade, the central bank data shows that exports improved by 44.6 per cent, mainly attributed to a combination of commodity prices of traditional products (tea, coffee, and minerals) and an increase in the volume of non-traditional exports that were driven by the recovery in the manufacturing sector. Imports also rose by 14.2 per cent owing to the rise in international commodity prices and high domestic demand. The bigger increase in export earnings reduced the trade deficit by 2.6 per cent in the first quarter.
Border infrastructure upgrade to boost trade (Zambia Daily Mail)
THE US$6.8 million European Union (EU)-funded border infrastructure upgrade will enhance trade, reduce smuggling and contribute to increased revenue collections, says Zambia Border Post Upgrading Project (ZBPUP) manager Simon Ng’ona. ZBPUP is funded under the EU-COMESA 11th European Development Fund trade facility programme grant to support trade facilitation activities, specifically the upgrading of soft border infrastructure at Chirundu, Mwami and Nakonde border posts.
Giving an update on the project, Dr Ng’ona said Zambia will increase its trade in the region and the rest of the world following the expected improvement in cross-border access to transport infrastructure and markets once the border post upgrading project is completed. He said as a land-linked country, Zambia has several border posts that link up the country with its eight neighbours, thereby making the country a key transit route for cargo across the north-south transport corridor. “However, the country’s border posts continue to experience infrastructure challenges [hard and soft] that undermine trade facilitation and consequently increases the cost of doing business.
Special Economic Zones To Create Jobs In Mombasa (Kenya News Agency)
Mombasa business community has called on the national government to expedite Dongo Kundu Special Economic Zone (SEZ) projected to create millions of direct and indirect jobs, attract massive investors and spur economy.
Kenya Chamber of Commerce and Industry (KCCI), Mombasa chairman, Mustafa Ramadhan said the government should prioritize the Sh39.1 billion project to help address the current economic challenges. Ramadhan noted that the SEZ project, would further cement Mombasa’s regional strategic commercial location besides addressing social and economic challenges grappling local population.
Independent Tea Producers Welcome Gov’t Tea Reforms (Kenya News Agency)
Independent Tea Producers in the country have lauded the government for the tea reforms introduced in the country, which have addressed the drastic decline in market pricing of tea especially at the auction. There had been concerns before on the way the buyers have been bidding at the auction with prices going below production.
Chairman Independent Tea Producers Association Collins Cheruiyot said that most producers who are processing green leaf from smallholder tea farmers are on board to support government’s setting up of the minimum tea price at the auction. “The market price of tea at the auction had put considerable strain on producers which in turn had reduced returns to farmers and to this end as independent producers, we support the steps set forth by the government to increase the minimum pricing at the Auction”, he said.
Mozambique-Malawi (MOMA) Power Interconnection Project launched in Mozambique (Construction Review)
The foundation stone has been laid to officially mark the start of the implementation of the Mozambique-Malawi Mozambique-Malawi (MOMA) power interconnection project in Mozambique. The stone was laid by Filipe Nyusi, the fourth President of Mozambique and his Malawian counterpart, Lazarus Chakwera. The 400-kilovolt transmission line that would provide Malawi with 50MW of power from Mozambique is projected to cost US$ 62M, with US$ 35M going toward the 142-kilometre line in Mozambique and the remaining funds going to the 76-kilometre line in Malawi. There will be 527 high voltage pylons in all.
A second component of the project is the US$ 21M enlargements of the Matambo substation, which will ensure the dependability of the power supply.
President Nyusi emphasised that the project’s development is part of the Southern African Development Community (SADC) master plan for energy infrastructure from 2018-to 2043. It will greatly contribute to strengthening Mozambique’s regional integration with neighbouring SADC nations.
Relationship with Neighboring Countries Top Priority - MoFA Spokesperson (Walta Information Centre)
Ethiopia’s relationship with neighboring countries is a top priority and the country is committed to realizing regional integration, Ministry of Foreign Affairs (MoFA) Spokesperson Dina Mufti said. In an exclusive interview with ENA, the spokesperson said “our relationship with the neighboring countries is critical and it is a top priority.” Stressing that neighboring countries are closer and more important, he pointed out that “whatever cooperation we forge with them in various aspects would be crucial.”
Cabinet approves National Quality Policy – It’ll guide production of quality goods, services (Graphic Online)
Cabinet has approved the National Quality Policy to operationalise a National Quality Infrastructure (NQI). The NQI is a system that spells out how goods and services must be produced to meet acceptable standards by all sectors of the economy, whether private or public. It will ensure that the production and provision of goods and services meet internationally acceptable quality standards.
The Head of Public Relations at the Ghana Standards Authority (GSA), Peter Agbeko, told the Daily Graphic yesterday that the policy would guide the implementation of the NQI, the system which also captured the policies, relevant legal and regulatory framework, and practices needed to support and enhance the quality, safety and environmental soundness of goods, services and processes. Quality infrastructure, he explained, was required for the effective operation of domestic markets and their international recognition to ensure that products from the country were able to access foreign markets. “The NQI is a critical element in promoting and sustaining economic development, as well as environmental and social wellbeing. It relies on metrology, standardisation, accreditation, conformity assessment and market surveillance,” Mr Agbeko added.
Dzifa Gomashie urges President Akufo-Addo to ensure reopening of Togo borders (Myjoyonline)
The Member of Parliament for Ketu South, Dzifa Gomashie, has appealed to President Akufo-Addo to urge President Faure Gnassingbé Eyadéma of Togo to open the land borders. She lamented that though Ghana has opened its land borders, it’s Togolese counterpart has refused to open its side of the boundary, despite the ECOWAS directive to the contrary. She indicated that the clarification that the boundaries would only be reaffirmed and re-demarcated as speculated, has allayed the fears that the exercise would antagonize any group of people.
Textile manufacturers demand market access (Daily Trust)
The Nigerian Textile Manufacturers have decried what they described as ‘the state of poor competitiveness of the textile industry’, which they said is dying and needs urgent interventions from the federal government. They lamented that despite efforts to revive the textile industry, the sector is still confronted with many challenges including high-cost of production that has rendered its product non-competitive; unrestrained snuggling and counterfeiting of Made-in-Nigeria textiles among others.
President of NTMA, Folorunsho Daniyan decried poor patronage in spite of the federal government of Nigeria’s Executive Order 003 of 2017. He listed other challenges facing the industry to include: inadequate and costly electricity supply, poor infrastructure, high taxation and interest rates, high cost of diesel and LPFO as well as depreciating value of the naira.
Major factors responsible for declining export capacity according to Daniyan are loss of preferential market access in the EU and US; inconsistent implementation of Export Expansion Grant (EEG) policy, particularly a perennial backlog of EEG claims; and inconsistencies in the implementation of ECOWAS Trade Liberalizatiin Scheme (ETLS).
Nigeria, others intensify action on tackling illegal fishing in W/Africa (ICIR)
Nigeria and five other coastal countries in West Africa (Togo, Benin, Ghana, Liberia and Cote D’Ivoire) have been meeting in Lagos to discuss progress on their efforts in stopping illegal, unreported and unregulated (IUU) fishing in their waters.
The six countries had come together in 2007 as a body, the Fisheries Committee for the West Central Gulf of Guinea (FCWC), to tackle illegal fishing. It was estimated that between 40 and 60 per cent of fish caught in the West African waters were caught illegally, a situation the FCWC Secretary-General, Seraphin Dedi Nadje, described as among the highest levels of illegal fishing globally.
According to the West Africa Task Force (WATF), which the FCWC established as the inter-agency regional mechanism to combat IUU fishing, the crimes involved in IUU go beyond illegal fishing and fisheries issues alone, so much so they required countries to collaborate to tackle effectively, hence the creation of the FCWC. Illegal fishing operators are said to be committing a range of violations and crimes against national fisheries regulations, national laws, and regional and international laws. It was agreed that national fisheries authorities alone cannot effectively tackle the violators and, therefore, needed one another to contain them.
Nigeria losing global private capital due to oil theft, policy inconsistency – Elumelu (ICIR)
THE Chairman of Heir Holdings, Tony Elumelu, on Thursday said Nigeria is losing substantial private capital as a result of policy inconsistency and oil theft. Elumelu, who is also Chairman of the UBA Group, speaking at the 2022 African Finance Corporation (AFC) conference in Abuja, said investment perception on Nigeria was not looking good due to several reasons. According to Elumelu, “When we have policy inconsistencies, policy instability and insecurity, it affects our business perception and investment decisions. In business, perception counts.
Economic benefits of Lekki Deep Seaport (The Nation Newspaper)
Last week, the Minister of Information and Culture, Alhaji Lai Muhammed and other top officials of the Ministry of Transportation visited the Lekki Deep Seaport to examine the benefits of the multibillion-dollar investment to the economy. The minister said the port would generate revenue of $201 billion for the Federal and Lagos State governments through taxes, duties and royalties during the 50-year concession period. The port, he added, would create over 170, 000 jobs.
Nigeria’s cryptocurrency problem has central bank scrambling (African Business)
When early in April the Central Bank of Nigeria (CBN) penalised six top banks a total of N1.3bn ($3.1m) for violating its directive against facilitating transactions in cryptocurrencies, it was the latest sign that the country’s crypto problem won’t easily go away.
With the government prohibition, the onus has been on the banks to detect accounts used to trade in cryptocurrencies. The CBN says that with data provided, banks should be able to identify those suspected of dealing in cryptocurrencies, including unusual volumes of transactions for accounts that don’t belong to licensed financial institutions. By fining the banks, the regulator is holding them responsible where transactions turn out to be a cryptocurrency trade.
By 2019, Nigeria had become Africa’s biggest cryptocurrencies market and its citizens the biggest holders of digital currencies outside the US. For the country’s monetary authorities, this became a source of concern, as the move to acquire offshore assets became another source of exchange rate pressure at a time when the CBN, led by Godwin Emefiele, was working hard to curb demand for foreign currencies.
The latest slap on the wrist for the banks adds to growing signs that Nigeria’s crypto problem isn’t going away soon. But as much as the banks are still tempted to deal in crypto, the watchdog is equally determined to catch them.
Egypt: Creating Jobs by Improving the Regulatory Environment for Investors (World Bank)
Launched in 2016, the Equal Access and Simplified Environment for Investment (EASE) program in Egypt has laid the foundations for making it quicker and easier for local and foreign investors to obtain operating licenses from local governments to set up businesses and secure land for industrial use, such as factories for manufacturing goods.
EASE ended in 2021 but it has made its mark on the General Authority for Investments and Free Zones’ (GAFI) One Stop Shops that act as a window for would-be investors. It also helped the Industrial Development Authority (IDA) to simplify, automate, and de-centralize industrial regulations in line with international good practice. And it helped the Egyptian Regulatory Reform and Development Authority expand its capacity to manage reform.
Having an investor-friendly business environment is crucial for allowing the private sector to become an engine for more jobs—and better jobs. The US$5 million World Bank program helps lay the foundations for this by supporting the implementation of a number of bold government reforms – turning them from laws on paper into practice. This includes the transformative Investment Law, the Industrial Licensing Law, the Industrial Development Authority Law, Amendments to the Company Law, the Modernization of the Investors Service Center, and the First Digital Investment Map of Egypt.
African trade news
Progress made in over 40 countries and RECs on AfCFTA national and regional strategies (UNECA)
The ECA’s Sub-Regional Offices (SROs) worked with more than 40 Member States and Regional Economic Communities (RECs) in 2021 on implementing national and regional strategies for the African Continental Free Trade Area (AfCFTA) agreement. Presenting a report on behalf of the Intergovernmental Committees of Senior Officials and Experts, which govern the work of the five SROs, Ms. Keita said SROs “were also able to offer technical assistance, advisory services, training and analytical tools to governments and Regional Economic Communities (RECs)” on the AfCFTA which is a cross-regional priority.
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ECA reports major progress in Africa’s key industrial sectors during CoM 2022
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Experts urged to explore creative ways to finance Africa’s recovery
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Africa requires multi-level responses to accelerate recovery from shocks
AfCFTA: Food safety takes centre stage on export trade activities (Vanguard)
As agribusiness becomes a focus in international trade, stakeholders in within African Union, has taken food safety to centre stage on export trade under the context African Continental Free Trade Area, AfCFTA, with bid to improve food security and ensure consumption of safe food for better health of Africans.
The Head of Agriculture and Food Security of the African Union Commission, Dr Simplice Nouala, Wednesday, pointed this at the ‘First workshop on Food Safety Information and Knowledge Management Systems in Africa’, held by African Union Commission, in Douala, Cameroon. Nouala further stated that the African Union is concerned with effective data generation, analysis and knowledge exchange to support risk assessment, decision making, inform food safety policy formulation and harmonisation at national, regional and continental level and conversely boost inter-African trade within the context AfCFTA.
How can Africa close its staggering financing gap? (The New Times)
Closing Africa’s financing gap requires that countries tackle issues such as unproductive tax policies, leakages in revenue collection and underdeveloped capital markets, Vera Songwe, the UN Under-Secretary-General and Executive Secretary of the ECA, stressed on Thursday, May 12. She stressed this in Dakar, Senegal, during the 54th session of the Economic Commission for Africa (ECA) Conference of Ministers which runs from May 11 to 18.
Pre Covid-19, the continent needed $200 billion, every year, to achieve agenda 2030. Post-pandemic, an additional $150 billion, annually, is needed to implement the SDGs. It is also noted that the continent’s adequate recovery requires an additional $285 billion for the next five years, as per IMF estimates.
Douglas Kigabo Bitonda, an economist in the macro-economics division at ECA, told The New Times that there are two main options when it comes to financing Africa’s recovery, post-Covid-19 and the Ukraine conflict. He said: “Option one is actually an internal factor; within our continent. And that is being serious with domestic resource mobilisation. This involves reducing leakages in financial resources flows or illicit financial flows.”
“Second is an external factor. This is all about having a voice to influence or to shape existing global financial instruments such as the SDRs to make them align with the continent’s needs,” Kigabo said.
Presently, Kigabo explained, the way the SDRs are designed limits access for African countries yet it is African countries that need them the most.
In response to economic challenges created by the global pandemic and the Russia-Ukraine conflict, Africa Finance Corporation (AFC) is launching a US$2billion facility to support recovery and resilience in Africa. AFC has committed to funding up to 50% of the new African Economic Resilience Facility and mobilising the remainder through the Corporation’s network of international partners and investors. The facility will be disbursed through loans from AFC to selected commercial banks, regional development banks and central banks in various African countries, providing them with much needed hard currency liquidity to finance trade and other economic activities in their jurisdictions. These institutions will be able to leverage AFC’s proven access to global funding to receive financing at competitive rates.
Speaking on the rationale behind the launch, Head of Treasury and Financial Institutions, Banji Fehintola, said: “The COVID-19 pandemic set back Africa’s economic growth trajectory and widened the trade financing gap, while the Russia-Ukraine conflict has added a further set of challenges negatively impacting growth prospects across the continent. We are determined to play a leading role in helping the continent’s recovery and resilience, not only though the work we do in bridging Africa’s infrastructure gap, but also through targeted interventions such as this $2billion economic resilience facility.”
Africa’s 5 Wealthiest Nations in 2022 have a lot more coming their way (The Exchange)
While there are a variety of approaches for comparing different countries’ wealth, one of the most effective is to examine the individual country’s gross domestic product, also known as GDP. During a given period, the gross domestic product (GDP) of a country is the conventional metric of value-added via the production of goods and services in that country, as measured by the United Nations. The amount paid on finished goods and services, as well as the amount of income produced from that output, is included in this calculation (fewer imports). The Gross Domestic Product (GDP) of a country gives an economic snapshot that may be used as a tool for estimating a country’s economic size and growth rate.
AU must facilitate digital platform for trade access on the continent – Annoh-Dompreh (MyJoyOnline)
Majority Chief Whip, Frank Annoh-Dompreh, has called for the establishment of a digital platform for trade access on the African continent. Describing the digital platform as a “crucial” mechanism, he believes it would led to more seamless trade interaction on the continent and would further enhance the integration of Africa’s trade blocs as the African Free Trade agreement picks up. Also, “Member countries should buy into this innovative approach.”
His call comes at a time where economies across the globe are reeling from the economic aftermath of the Covid-19 pandemic and the ongoing Ukraine war.
With the risk of recessions hitting some economies due to their rapidly shrinking economies, Annoh-Dompreh’s call emphasises the need for a larger market for African economies through the rapid integration of continental trade blocs to offset the risk of recession often weak African economies may face in the coming months.
PwC study shows African governments focusing on expanding the tax net (Engineering News)
Within Africa, governments continue to focus on expanding the tax net by improving revenue collection through efficient compliance systems and procedures. Assurance, tax and advisory services company PwC Africa has observed that revenue authorities also continue to take a keen interest in indirect taxes as part of revenue mobilisation initiatives. PwC Africa has released the eighth edition of the value-added tax (VAT) in Africa Guide under the theme ‘Africa re-emerging’. This forms the backdrop of renewal that informs the theme and its purpose of focusing on the re-emergence of African economies and societies which have been affected by the Covid-19 pandemic, the company says.
Regional ICT Programme Worth €8 Million Launched (COMESA)
Five Regional Economic Communities (RECs) are set to benefit from a new eight million euros project: Enhancement of Governance and Enabling Environment in the ICT sector (EGEE-ICT), funded by the European Union. It will support the review and/or development of various regional policy and regulatory framework in a harmonized manner that will contribute to enhancing competition, improved access to cost effective and secure ICT services.
The programme will coordinate regional public and private sector ICT policy development, enhance policy and regulatory environment for competitive markets and gender sensitive ICT markets and improve infrastructure connectivity and access to ICT.
“ICT accessibility and affordability is the key for utilizing e-services and for reaching all groups of society in remote areas and other disadvantaged groups in order to transform the landscape for development,” said Dr Kipyego Cheluget, COMESA Assistant Secretary General for Programmes.
The EGEE-ICT will leverage on available opportunities to enhance the capacities of public and private sector institutions and the civil society to develop, implement and monitor harmonized ICT policies and regulations. The programme will also develop model policy and regulatory frameworks that enhance cross-border interconnection, competition, trade facilitation, e-commerce as well as gender perspectives in regional ICT markets.
Mineral Resources: Why Isn’t Africa Richer? (DW)
From Ashanti gold to southern Africa’s diamond mines, and more recently cobalt, lithium and coltan: For centuries, people around the world have exploited Africa’s precious minerals. But despite Africa’s immense mineral wealth, the continent is yet to reap the financial benefits.
In a country built on its mineral wealth, South Africa’s small scale artisanal miners are left digging for mere morsels of gold and diamonds. Turf wars and meagre yields mean many miners live a life of poverty. Diamonds, gold, bauxite, iron ore: You name it, Sierra Leone’s got it. 20 years after the civil war, the West African country is no longer ruled by conflict diamonds. But does the modern-day mineral sector really benefit the people of Sierra Leone? Edith Kimani heads to Koidu town in the diamond-rich Kono District to find out.
Facing multiple food and health crises, Africa must lead boldly (Thomson Reuters Foundation)
Africa’s leaders to rally together for urgent, practical responses to protect the most vulnerable from a tsunami of shocks undermining the livelihoods of millions
The world is in crisis, and it would be easy to be dismayed by what lies ahead for so many of us. In Africa, the last five years have been a roller coaster with COVID-19, climate and conflict undermining progress and compounding an already dire humanitarian situation in many regions.
Over 27 million people are going hungry in West-Africa due to drought and conflict. Supply chains have been disrupted. Fertiliser prices are skyrocketing. We need Africa’s leaders to rally together for urgent, practical responses to protect the most vulnerable. The war in Ukraine has sent fuel and food prices to record levels. Some African countries have been getting more than 60% of their wheat imports from Russia and Ukraine and many are beginning to feel the impacts of shortages. This is a tsunami of shocks undermining the livelihoods of millions and years’ worth of development gains.
As some countries impose export bans and private sector hoarding occurs due to speculation, the global community must ensure trade stays open, as it is a key contributor to fighting hunger. The African Continental Free Trade Agreement, when optimized, can help reduce dependence on imports, deliver better prices for farmers, and lower the carbon footprint of food by reducing loss and waste. At present, significant volumes of food – estimated at US$4 billion dollars’ worth of grains alone – are lost every year. This exceeds the value of the total food aid received in Sub-Saharan Africa over the past decade. Africa has an opportunity to pursue diversified production systems to increase productivity and strengthen resilience. African leaders can prevent this crisis from becoming a disaster by ensuring farmers have the means to sow the next crop to build stronger resilience for agriculture systems.
Saharawi Arab Democratic Republic becomes the 43rd African Union Member State to ratify the Protocol on Women’s Rights (African Union)
The Saharawi Arab Democratic Republic (SADR) has ratified the Protocol to the African Charter on Human and Peoples’ Rights on the Rights of Women in Africa, becoming the 43rd African State to ratify the Protocol and committing to advance the reality of the rights of women, gender equality and women’s empowerment in that country. Saharawi deposited the Instruments of Ratification with the African Union Commission on the 29th of April 2022.
The fight against all forms of discrimination against women through appropriate legislative, institutional and other measures has been a continuous journey since July 2003, when African Union Member States adopted the Protocol to the African Charter on Human and People’s Rights on the Rights of Women in Africa (the Maputo Protocol). The Protocol remains the most comprehensive and progressive instrument on women’s rights, laying out provisions for women’s inclusion in socio-economic and political spaces, and places a responsibility on African States to eliminate discrimination against women and promote their rights by introducing and effectively implementing legislative, institutional and programmatic measures.
Kenya likely to host new African Medicines Agency (Kenya Broadcasting Corporation)
On Thursday, the cabinet chaired by President Uhuru Kenyatta approved the ratification of the African Union Treaty for the Establishment of the African Medicines Agency (AMA), which now awaits the passing of the necessary legislative instruments at the National Assembly. The establishment of AMA in Kenya, he said, will provide the country with an opportunity to leverage foreign direct investment flows estimated at more than 570 billion in the short-to-medium term.
China-Africa trade rises in first quarter, though coming months may see a flattening (Global Circulate)
Bilateral trade rose 23 per cent to US$64.8 billion, compared to the same period in 2021, boosted by African exports of minerals and metals. But pandemic-related disruptions, like the lockdown in Shanghai, could limit activity in months ahead, analysts say
Trade between China and Africa rose 23 per cent to US$64.8 billion in the first quarter compared to the same period last year, boosted by increased imports of minerals and metals from the continent. Chinese imports from Africa increased by 29.3 per cent to US$29.7 billion while exports to Africa rose by 18.2 per cent to US$35.16 billion during the first three months of 2022, according to China’s General Administration of Customs data.
African Trade Deal Exposes Brexit Britain’s Myths (Byline Times)
As Brexit sends the UK lurching from one crisis to another, and while the Government still hasn’t fully implemented checks on EU imports for fear of economic disaster, another continent has taken a vital step towards full regional economic integration. The African Continental Free Trade Area (AfCFTA) came into force one month before Brexit and has now reached an agreement to eliminate tariffs on nearly 90% of non-sensitive goods. “It makes economic sense, as well as social and political sense, to integrate the continent,” says Stephen Karingi, director of regional integration and trade division of the UN’s Economic Commission for Africa.
Contradicting the Conservative Party’s ‘Global Britain’ mantra, which claims that Britain has been restrained by close economic ties with its neighbours, the AfCFTA seeks to catalyse trade across Africa to the benefit of the whole continent.
“Under the AfCFTA, Nigeria stands to gain from increased access to cheaper goods and services from other African countries,” argues John Oseji, director of policy advocacy at the Nigerian Investment Promotion Commission (NIPC) – a Nigerian Government agency founded to encourage investment in Nigeria.
Nigeria was initially hesitant about joining the AfCFTA, mirroring Britain in Europe. As Africa’s largest economy – though Britain was Europe’s second – it had concerns about rules of origin, commercial competition from cheaper foreign imports and from the other advanced African economies, primarily South Africa, Morocco and Egypt.
Global economy news
Developing a Stronger Global Trade Architecture in 2022 (U.S. Chamber of Commerce)
From the lingering COVID-19 pandemic to supply chain shortages to inflation, global challenges are impacting business and trade worldwide. Day two of the U.S. Chamber of Commerce’s 2nd Annual Global Forum examined how civilians, businesses, and leaders are dealing with these substantial shifts to the global trade landscape in 2022.
Recently, people have started talking about de-globalization in trade — a rising skepticism Dr. Okonjo-Iweala feels had started even before the pandemic. However, she said, COVID-19 and the war in Ukraine have exacerbated those fears. “I think the pandemic and the war on Ukraine just accelerated and heightened this feeling that the multilateral trading system and multilateralism as a whole [are] in trouble and can no longer deliver,” said Dr. Okonjo-Iweala. However, the data continues to show the success of globalized trade. “If you look at the actual numbers of trade flows, you will see what’s happening on the ground doesn’t speak to the multilateral trading system not working.” Dr. Okonjo-Iweala continued. “Consumers seem to be doing something somewhat different from what politicians are saying.”
At a recent supply chain conference, Dr. Okonjo-Iweala said she and her team identified the problems to be solved within supply chains, including a lack of truck drivers, a lack of port operators and airports, and shipping backups in Shanghai. Many of these issues were related to pandemic restrictions. “We’ve gone from 119 export restrictions at the beginning of the pandemic down to about five,” said Dr. Okonjo-Iweala.
In late April 2022, Dr. Okonjo-Iweala, chair of the MC12, and other leaders informed delegates the previously postponed event would take place in June 2022. The date fix, caused by a COVID omicron outbreak in Europe, falls amid lingering pandemic issues and Russia’s war on Ukraine.
“The strategy is to try to work on food security issues,” explained Dr. Okonjo-Iweala. “We hope [the delegates] will have something on the response to the pandemic, [on] issues of transparency and export restrictions, fisheries, and agriculture to at least advance the negotiations.”
How Globalization Is Impacting the Changing Landscape in 2022
The Impact of Digitalization on the Global Marketplace in 2022
Why ports are at the heart of sustainable development (UNCTAD)
Most of the products we consume daily travel through ports, making them a key link in the global production and supply chains we rely on. “Our livelihoods – food, jobs, energy – depend on functioning and resilient supply chains,” UNCTAD Secretary-General Rebeca Grynspan said. How ports are managed has implications for economic growth, crisis response efforts, environmental protection and gender equality, placing them at the heart of sustainable development.
The efficiency of a port directly affects the economies of the countries it serves, since more than 80% of global trade is carried by sea. The percentage is even higher for many developing countries. The COVID-19 pandemic has been a stark reminder that when ports slow down, everyone suffers.
UNCTAD analysis has shown how surges in freight rates can raise the prices of goods, especially in least developed countries and small island developing states.
While ports are vital for economic development and crisis response, the associated maritime traffic, handling of goods, and road and rail transport take a toll on the environment through air and water pollution.
Ports are an important source of local employment, but they have historically created more jobs for men than women. Data from over 50 ports working with UNCTAD’s TrainForTrade port management programme show that women held just 18% of official port jobs in 2021. The ports are spread out across Africa, Asia, Europe and Latin America. The highest regional average was 22%, reported by the European ports that participated in the study. A closer look showed a more encouraging average of 42% for management and administrative roles in ports. But in cargo handling and operations, just 6% of workers were women. The figures highlight the need to empower women port workers and to continue working towards gender equality in the sector.
Commodity Markets Book 2022 (World Bank)
Global commodity markets are being reshaped in lasting ways as a result of COVID-19, the war in Ukraine, and the impacts of climate change—a transformation that is likely to have profound implications for developing economies over the coming decades, a new World Bank study has found. The study, Commodity Markets: Evolution, Challenges, and Policies, offers the first comprehensive analysis—encompassing all major commodities—of how these markets evolved over the past 100 years and the directions they are likely to take over the next 30. It predicts that growth in overall global demand for commodities is likely to decelerate as population growth slows and developing economies mature, although demand for some commodities is likely to rise.
Moreover, the transition to cleaner energy is likely to be challenging. Demand for metals necessary to build the infrastructure for renewable energy and to produce electric vehicles is likely to surge in the coming decades, driving up the price of metals and delivering windfall gains for countries that export them. Although renewable energy is fast becoming the lowest-cost source of energy in many countries, fossil fuels will probably retain some of their appeal, especially in countries with ample domestic reserves. In the short-run, with inadequate investment in low-carbon technologies—just one-third of the required level—energy demand could continue to outstrip supply, keeping prices at elevated levels.
How debt cancellation could help poor countries prepare for climate change (Grist)
As the planet warms, compounding crises are pushing poor countries toward a humanitarian catastrophe. Global warming disproportionately threatens the developing world with rising sea levels, more intense storms, and scorching heat waves. At the same time, crippling debt is making it harder for many of these countries to prepare for and recover from these disasters. A prime example is Eritrea, whose gross public debt is projected to exceed 160 percent of its GDP this year, causing the African Development Bank Group to label the country “in debt distress.” This debt may sap funds away from much-needed measures to adapt to temperature increases above the global average, extreme drought, and famine conditions like those that are currently wreaking havoc on the Horn of Africa. Without urgent action, experts warn of a “doom loop” of deepening debt and deteriorating environmental conditions. A new report from the Climate and Community Project — a coalition of academics and policy experts working to advance climate justice — urges the United States and European countries to provide immediate relief through a program of “climate reparations,” including through large-scale debt cancellation and restructuring.
Even though the least developed countries have only contributed about 8 percent of the planet’s greenhouse gas emissions since 1850, they are poised to bear the brunt of climate change’s devastating impacts.
TRIPS waiver compromise tabled at WTO finds few takers (Devex)
Discussions began last week within the World Trade Organization over a proposal to temporarily waive patent protections on COVID-19 vaccines. Even as WTO officials press for a resolution ahead of a long-delayed ministerial conference in June, the halting reactions of members to the document signal that reaching consensus in a month — or at all — will not be easy. The agreement, described by WTO as an “outcome document,” emerged from discussions between the so-called Quad, comprised of the European Union, the United States, South Africa, and India. Meanwhile, it has drawn significant criticism from access-to-medicines activists for what it does not include.
STDF, Asian Development Bank champion “smart” regulations to promote safe food trade (WTO)
SPS regulators and practitioners shared examples of how GRPs – such as transparency, consultations, stocktaking and forward-looking regulatory agendas – are being used across Asia to modernize and improve SPS regulations. "GRPs encourage good governance and have the potential to increase public trust and the confidence of investors and trading partners in the long run," said WTO Deputy Director-General Jean-Marie Paugam, referencing the STDF GRP Guide as a practical resource for SPS regulators.
Chair convenes “Fish Week” to close gaps in fishing subsidies negotiations ahead of MC12 (WTO)
now is the time to end decades of negotiations and conclude the WTO fisheries subsidies negotiations so that the results can be adopted by ministers,” the chair said in the video message. “To this end, from May 16 to 20, delegates representing the members of the WTO will gather in Geneva for a “Fish Week”.
“There is no doubt that a worldwide deal is within reach — never has it been this close and we must not miss this opportunity. Ultimately, we should not be negotiating against each other but against the unrelenting depletion of global fish stocks so vital for livelihoods, food security, and a healthy planet. The longer we wait, the more the fish lose. And the more the fish lose, the more we all lose,” he said.
UN-Energy Plan of Action Sends SDG 7 Roadmap into Implementation Phase (IISD)
The launch of the UN-Energy Plan of Action towards 2025, which seeks to realize the global roadmap to accelerate action on SDG 7 (affordable and clean energy), followed up on the September 2021 High-level Dialogue on Energy (HLDE). The Global Energy Compact Network was launched at the same time, to support governments and stakeholders in achieving their voluntary commitments on energy. This policy brief ties together the discussions during the HLDE in September 2021 and those during last week’s launch event to help SDG Knowledge Hub readers understand this shift from goal setting to implementation.
The energy action plan and network were launched during a half-day event titled, ‘Transforming Commitments into Action: Delivering on the Outcomes of the High-level Dialogue on Energy’ – a “framework for collective action by nearly thirty UN and international organizations” to implement the SDG 7 roadmap in support of the 2030 Agenda and the Paris Agreement on climate change – which convened virtually on 4 May 2022.
APEC: Free trade pandemic to head meeting agenda (Bangkok Post)
Free trade and pandemic issues make up the bulk of recommendations submitted to the trade ministers’ meeting held as part of the Asia-Pacific Economic Cooperation (Apec) summit. The meeting hosted by the Commerce Ministry in Bangkok is scheduled to take place from May 19-22.
"Eight recommendations aimed at strengthening economic integration and businesses of all sizes will be presented to Apec ministers responsible for the trade meeting," said Poj Aramwattananont, chairman of the Apec CEO Summit and a member of the Apec Business Advisory Council (Abac) Thailand. Among the recommendations are issues pertaining to the long-delayed Free Trade Area of the Asia-Pacific (FTAAP), preparations for future pandemic shocks, reopening borders for safe and seamless travel, and support for a rules-based multilateral trading system.
BRICS needs to be more cohesive in dealing with geopolitical developments (Moneycontrol)
The BRICS (Brazil, Russia, India, China and South Africa) group of countries will hold the 14th edition of their annual summit in China next month with a focus on a ‘new era of global development’ as the world continues to grapple with the mounting repercussions of the Ukraine conflict leaving the world divided as West vs the Rest. There is no surprise that no BRICS member took a position that was uncomfortable to Moscow. They all were guided by trade and economic concerns, diplomatic traditions and historical connections in firming up their positions on Ukraine.
the western sanctions have made life difficult for people doing business with Russia. And all of the BRICS countries are victims of that. Following the military conflict in Ukraine, Moscow has been hit by unprecedented Western sanctions that have knocked Russia off the global financial system. Almost half of Russia’s $600 billion in foreign exchange is stuck and Russia’s biggest banks have also lost access to the SWIFT global banking messaging system. To make things more precarious, among the five BRICS countries, three of them, Russia, Brazil and South Africa face an economic downturn. The border tussle between two of Asia’s biggest economies, India and China, has come in the way of their economic ties realizing greater potential. That being the case, the BRICS grouping remains at the cusp of a changing global order where the Ukraine conflict has brought to the fore sharp divisions between the west and the rest. As developing countries and members of the G 20 grouping, BRICS nations need a more coordinated approach in dealing with political developments that affect their national economic goals.
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Local news
South Africans set for early US citrus programme start (Fruitnet)
The South African Summer citrus marketing campaign in the US is likely to start in earnest by the middle of June, according to Summer Citrus from South Africa. This will be some weeks earlier than last year and is the result of the Californian crop coming to an early end this year. First container shipments are already on the water and the first of the weekly conventional reefer vessels is likely to start loading by the middle of May. “The development of the fruit on the trees will determine the date of departure of the first conventional reefer,” said Summer Citrus from South Africa spokesperson Boet Mouton.
Conventional reefer vessels for the US programme are supplied by Seatrade and will be loaded weekly from the middle of May, or a soon as the fruit is ready for picking. South African citrus shippers to the USA normally use containers at the start and the end of the season. This year South African growers will be grateful that they have the conventional programme at their disposal as everywhere around them exporters are facing a shortages of containers.
While container shipments have in recent times been disrupted, particularly due to floods in the port of Durban and delays elsewhere in South Africa ports, conventional reefer vessels have been loading at the Fresh Produce Terminals in the Durban port as well as in Cape Town on the trade route to Europe.
South Africa advocates boosting mining cooperation with Angola (Angop)
South Africa’s Minister for Mineral Resources and Energy, Gwede Mantasha, on Tuesday in Cape Town, said that his country wanted to boost cooperation with Angola in the geology and mining sector. Speaking to the Angolan press after holding a working meeting with his Angolan counterpart, Diamantino Azevedo, he said that it was necessary to increase trade in mineral products between the two states. ”We have to increase trade in mineral products because we are trading more with our former colonisers than with ourselves,” Gwede Mantasha said on the sidelines of the Mining Indaba international conference. He noted that Angola has great potential and experience in the oil sector and South Africa in the mining sector.
Insights from Zimbabwe on how to link formal and informal economies (The Conversation)
Industry capacity utilisation increases to 56,5pc: CZI (The Herald)
According to the Confederation of Zimbabwe Industries (CZI) 2021 manufacturing sector survey report launched in Harare yesterday, surveyed firms invested US$147 million towards new capacity, with the funds largely coming from the Reserve Bank of Zimbabwe (RBZ’s) foreign currency auction system. “37,8 percent of the manufacturing sector undertook investments to increase their production capacity in 2021 and this resulted in additional capacity of 25,6 percent,” Dr Cornelius Dube, the CZI chief economist, said while presenting the survey report.
“Testimonial to this, the manufacturing sector has realised a 5,5 percent increase in exports from US$383 million in 2020 to US$404 million in 2021. In addition, we welcome the Zimbabwe National Statistics Agency (Zimstat) timely figures on provincial GDP with Harare having $294 billion out of $1,157 billion in 2020, thus contributing 24,4 percent to national GDP,” Industry and Commerce Minister Dr Sekai Nzenza said.
Transporters appose second-hand trucks, buses importation ban (Business Daily)
Kenyan transporters have protested the government’s decision to ban the importation of second-hand buses and trucks. Salim Karama, one of the transporters, said the ban by the Kenya Bureau of Standards (Kebs) will encourage more companies to shift their base to other East African countries where such policies do not apply. “The shift by the government to ban importation of trucks not more than 8-years to three years and further banning them altogether will make the trucks more expensive and will increase from the current Sh5.5 million to more than Sh16 million. This will make them unaffordable to many transporters, causing them either to close their shop or move to countries where such policies do not apply,” said Mr Karama. Former Kenya Transporters Association executive director Dennis Ombok blamed the government for introducing such a policy without involving key stakeholders such as transporters.
Kigoma ports steal show in regional trade volume (Dailynews)
Total trade volume between Tanzania and other countries sharing Lake Tanganyika, particularly the Democratic Republic of Congo (DRC), stood at 740bn/- in the year 2019 compared to a combined 600bn/- earned from other major four border points in East African Community (EAC) during the same period.
Available statistics indicate that earnings through Kigoma ports in Lake Tanganyika are on the increase despite infrastructure challenges compared to other border points including Sirari in Mara, Namanga in Arusha, Holili in Kilimanjaro and Horohoro in Tanga. It is on this backdrop that the Kigoma Regional Commissioner, Mr Thobias Andengenye, is upbeat that the three-day Lake Tanganyika Investment and Business Summit, which started on Monday, will further open up Kigoma Region for cross-border trade.
For his part, Kigoma’s Tanzania Chamber of Commerce, Industry and Agriculture (TCCIA) Chairman, Mr Abdul Mwilima, said efforts should be increased to open up Kigoma since the region is located in a strategic position for trade along Lake Tanganyika. He was of the view that trade volume between Tanzania and other countries sharing Lake Tanganyika could surpass 1tri/- if there is supporting infrastructure such as roads, railways, airports and ports.
Ugandan manufacturers push for return to Rwandan market (The East African)
Ugandan exporters and manufacturers are still struggling to return to the Rwandan market, three months after Kigali reopened its common border with Kampala after nearly three years of closure. The persistent trade bottlenecks are a blot on the recent public relations efforts by Lt-Gen Muhoozi Kainerugaba, the Commander of Uganda’s Land Forces, whose shuttle diplomacy was followed by the announcement of the reopening of the common borders in February. The reopening was taken as a sign of a new chapter in the relations between Uganda and Rwanda, as both countries promised to tackle contentious issues through dialogue. The open border was expected to return bilateral trade between the two countries, especially in sectors such as food and agriculture, mining, iron and steel-related industries.
“Since the announcement of the border opening, there have been preliminary discussions about resuming operations in a market where we have not been in a long time. These have been mainly between Ugandan manufacturers and their distributors in Rwanda pushing for the resumption of trade,” Mr Birungi said.
Uganda’s exports to Rwanda hit a low of $2 million in 2020 at the peak of hostilities between the two countries, from a high of more than $200 million before the closure of the border. Ugandan manufacturers took more business into South Sudan and explored further alternative markets like the Democratic Republic of Congo.
Inside Tanzania, Uganda deals sealed in Samia’s state visit (The Citizen)
Tanzania has agreed to cut a road toll by about 71 percent on the Uganda-bound cargo trucks as part of the consensus reached during the meeting of leaders of the two countries. From mid-last year, Tanzania government charged $500 on Ugandan cargo trucks as fees collected for road repairs and maintenance. Kampala immediately protested and filed a complaint with the East African Community (EAC) Council of Ministers accusing Dodoma of breaching the Common Market Protocol by imposing different road user charges to partner states in the same trading bloc. The Common Market is one of the pillars of the seven member regional bloc. However, starting next financial year, which kicks-off this July, Tanzania will charge $10 per 100km on the cargo trucks plying the 1,485km Mutukula-Dar es Salaam route. The $10 translates into about $144 for the distance, down from the $500.
Tanzania cuts levy for Uganda cargo trucks (Monitor)
Bazivamo urges Rwanda’s private sector to leverage opportunities in EAC market (The New Times)
Christophe Bazivamo, the Deputy Secretary General of East African Community (EAC) has urged the Rwandan private sector to leverage opportunities that are available in the region, by improving standards of their products as a way of expanding their businesses and increasing revenues on the regional and global market.
“Rwanda private sector should first consider the market available in the East African Community while preparing their business plans,” he said. “Some measures to facilitate free movement of businesses in the East African Community include the use of national identity cards while travelling in the region. People can call to and from Kenya, Uganda, South Sudan and Rwanda and this is part of the steps to ease doing business, cooperation and integration,” he said. One of the investment and market opportunities in the region, he said, is available in agribusiness.
Freight forwarders seek review of operation fee (The Street Journal)
The Africa Association of Professional Freight Forwarders and Logistics of Nigeria (APFFLON) has called for the review of the act establishing the Council for Regulation of Freight Forwarding in Nigeria (CRFFN) on the Practitioners Operation Fee (POF). According to the Permanent Secretary, Federal Ministry of Transportation, Dr. Magdalene Ajani, the country is losing much revenue to the non-collection of POF. He noted that integrating the policy will promote global competitiveness and build capacity for effective participation in the African Continental Free Trade Area (AfCFTA).
FG woos investors to revamp Calabar, Kano Free Trade Zones (Daily Sun)
As part of its efforts to revitalise the economy, the Federal Government of Nigeria through The National Council on Privatisation (NCP) via its Secretariat, Bureau of Public Enterprises (BPE) in conjunction with the Federal Ministry of Industry, Trade and Investment and the Nigeria Export Processing Zones Authority (NEPZA) has declared open the opportunity for the concession of the Calabar and Kano Free Trade Zones in a bid to make them world-class standard, functional and globally competitive.
The Minister of Industry, Trade & Investment (FMITI) Adeniyi Adebayo Otunba, who made this known in Lagos decried the cumulative investment earnings of about $20bn from the Calabar and Kano Free Trade Zones when compared vis a viz what other African countries particularly have earned from their Trade Zones.
“The ultimate aim of the free trade zone scheme is to attract foreign direct investments, generate employment, enhance trade and industrialization, promote exports, enhance foreign exchange earnings, and encourage the transfer of technical know-how.
“Other countries have leveraged FTZs, which are designated areas for promoting trade openness and investment facilitation, as a dynamic instrument for growth and development. Sadly, efforts to replicate the success of the FTZ model in Nigeria have not recorded the same success,”
UK-Ghana trade links boosted as political and business leaders meet in London (GOV.UK)
Economic ties between the UK and Ghana were boosted this week as the UK-Ghana Business Council (UKGBC) met in London. The formation of the UK-Ghana Investors Group, made up of investors and business leaders with the aim of creating investment opportunities, was announced and UK representatives welcomed recent deals in the gold supply chain and security sectors worth more than £100 million.
Minister for Africa Vicky Ford said: The UK and Ghana trade is already worth almost a billion pounds per year, but there is so much more our two economies can do together. The signature of the UK-Ghana Trade Partnership Agreement last year paved the way for closer economic ties and this week we’ve discussed the potential for huge growth in both countries, driven by British International Investment’s ambitious plan for the year ahead.
Minister for Trade Policy Penny Mordaunt said: The UK’s trade ties with Ghana already help businesses in both our nations flourish, and I’m determined to deepen these ties to create more jobs and deliver mutual prosperity. Ghana is one of the fastest-growing economies in the region and the UK’s fourth-biggest export market in sub-Saharan Africa, with the UK aiming to boost UK-Ghana trade to £1.4 billion by 2024.
Ghana’s democratic credentials, mining framework good for investment – Jinapor (Class FM Online)
The Minister of Lands and Natural Resources, Mr Samuel A. Jinapor, ahs said there must be a careful balance between ensuring that citizens get the maximum benefits from their resources and attracting the needed capital and technology for the effective exploitation of the resources. Contributing to a panel discussion on ‘Resource Nationalism’ at the ongoing “African Mining Indaba” conference in Cape Town, South Africa, Samuel A. Jinapor stressed that striking the right balance between the aforementioned issues will resolve the headache of resource nationalism.
The Lands Minister said the framework for the mining sector in Ghana is cast out clearly and indicated that, for potential investors who want to do business with the government of Ghana, they should be certain that the sanctity of contractual agreements is the norm and not the exception, adding that government will respect and comply with contractual agreements.
“If an investor were to come into Ghana, he knows the local content laws clearly, he knows the physical framework we work with in the country clearly and the regulatory framework so the rules don’t change in the middle of the game,” he said. Mr Jinapor said the issue of value sharing and Mining impacting on the livelihoods of populations have to be looked at dispassionately as poverty, COVID- 19 and other occurrences have made these impact almost impossible to be realized by the indigenes of mining nations.
What you need to know about the Central African Republic’s adoption of Bitcoin (African Business)
he Central African Republic (CAR) adopted Bitcoin as an official currency alongside its local currency, the CFA franc, the presidency announced on April 27. The move sparked a backlash from the region’s central bank, the Bank of Central African States (BEAC), which manages the Central African CFA Franc common currency used by six countries: Cameroon, Central African Republic, Chad, Republic of Congo, Gabon and Equatorial Guinea. In response to the move, BEAC issued a statement declaring the CAR’s adoption of the new cryptocurrency law “null and void” and in violation of the tenets of the regional bloc. “This law suggests CAR aims at establishing a currency competing with or aiming at replacing the Central Africa Central Bank and the Franc CFA,” the statement said. The IMF also raised concerns about the CAR’s decision, protesting that the move was made without consulting the regional economic union, the Central African Economic and Monetary Community (CEMAC). The adoption “raises major legal, transparency, and economic policy challenges,” the IMF said, adding that they are assisting the region and the CAR’s authorities in addressing the concerns posed by the new law.
Why import restrictions aren’t enough to help Nigeria industrialise (The Conversation)
Nigeria has a strong ambition to industrialise. It has relied heavily on the restriction of imports of certain goods targeted for domestic production. But for Nigeria’s industrialisation drive to succeed, it needs a broader array of industrial policy tools than simply import restrictions. These tools should include addressing binding constraints in different sectors to raise productivity. And addressing the flaws in the design and implementation of industrial policies. A further complicating factor is regional integration, specifically Nigeria’s approach to it, and a lack of capacity both in Nigeria and the Economic Community of West African States to manage illegal cross-border trade.
Industrial policies have often been a response to economic crises following a fall in oil prices. Governments consequently tend to rely on import restrictions and foreign exchange controls to incentivise domestic production. Nigeria’s focus has been on the so-called backward integration policy . Under this approach imports of designated products are limited to a handful of companies through licences and quotas. Import licences are gradually phased out as these firms ramp up local production.
But successive governments have not paid enough attention to the whole value chain. Rice milling capacity, for example, is constrained by continued electricity disruptions as well as lack of local markets for spare parts of milling equipment. This elevates the operating cost of mills, and increased disruptions. The effect is a reduction in the competitiveness of locally produced rice.
Tech sector driving Nigeria’s govt non-oil export agenda (Vanguard)
Nigeria is regarded as Africa’s largest ICT market with 82% of the continent’s telecoms subscribers and 29% of internet usage. Sub-Saharan Africa is also projected to be the fastest growing region with a compound annual growth rate of 4.6% and an additional subscriber enrollment of over 167 million in the next five years. Nigeria is expected to account for over 55% of this. The NCC estimates that the country has about 76 million subscriptions on broadband (penetration of 40%) and 187 million lines in the voice segment as of May 2021, representing 97.9% teledensity.
Senegal: State distributes aid as global economic crisis hits (Africanews)
President Macky Sall has announced “emergency” cash transfers to more than half a million Senegalese households to help them cope with the effect of the war in Ukraine and the Covid pandemic. Since the start of the war in Ukraine at the end of February, oil prices have soared on world markets, driving a sharp rise in fuel and food prices in many countries, including Senegal. “To provide solutions to the unfavourable situation, I have decided to support the resilience of 542,956 households to receive an exceptional financial cash transfer from the state in the amount of 43.4 billion CFA francs (66 million euros),” said President Sall, during a ceremony at the Grand Theatre in Dakar.
Senegal’s economy returned to its pre-Covid-19 growth trajectory last year, but the war in Ukraine “clouds the outlook” for the economy, the International Monetary Fund (IMF) said in March in a statement. The rise in global food and energy prices caused by the conflict comes on top of “the aftermath of the pandemic, regional insecurity and rising social demands in the run-up to parliamentary elections in July,” Edward Gemayel, who led an IMF mission to Senegal from 9 to 15 March, said recently.
EBRD predicts that the Moroccan economy will grow by 3% in 2023 (Tumbler Ridge News)
The EBRD presents its economic forecasts report stating that by 2022, the Kingdom’s economy will face adverse weather conditions that will affect agricultural production in Ukraine, in addition to the impact of the war. This forecast is taken into account “The effects of the drought are expected to put pressure on domestic food prices and boost the country’s food imports to higher international prices.” The financial institution says that disruptions in the global supply chain are an additional drag on growth. “These risks are likely to continue into next year, although we can see a resurgence in 2023 growth, forecast at 3%, as agriculture recovers and the pace of growth returns to the pre-epidemic level,” supports EBRD.
INS explains why imported food inflation is higher in Douala than in Yaoundé (Business in Cameroon)
The prices of imported food products increased by 10.1% between March 2021 and March 2022 in Douala, the National Stats Agency (INS) reported. In Yaoundé, the rate is 9.2%. Logically, prices in Douala should increase less than in Yaoundé, since the economic capital is home to the country’s largest port, which is the gateway to more than 90% of the goods imported by the state. Yaoundé, on the other hand, is located about 240 km from the port of Douala, and consequently, the final prices of imported products are usually inflated by the cost of transportation. To explain this mismatch, an INS official blamed it on the “speculative activities of crooked traders,” whose tracking seems to be more vigorous in Yaoundé (the administrative capital) by the Ministry of Commerce’s national fraud control and repression brigade. The crackdown on these dishonest traders is less dynamic in other cities, the INS official regretted.
The Port of Kribi plans to build an 80 MW thermal power plant (Business in Cameroon)
The Port Authority of Kribi (PAK) announced the upcoming construction of a thermal power plant (80 MW) to supply the port platform. Patrice Melom, MD-PAK has already launched an international call for tender to select the partner. The successful bidder will be responsible for conducting comprehensive technical, financial, legal, and commercial due diligence. The company will also define the technical solution to be implemented while specifying the installed capacity, the type of technology to be used, and the impact on the operational performance of the plant. In addition, it will be in charge of developing a consultation file to be used for the selection of private partners and the elaboration of contractual documents needed in the framework of the project, in particular, the power purchase agreement.
Egypt imports from COMESA countries record decline by end of 2021: CAPMAS (Egypt Today)
The Central Agency for Public Mobilization and Statistics (CAPMAS) monitored a noticeable decline in the volume of Egyptian imports from the COMESA group recently, as the total value of Egyptian imports amounted to about 15.8 million dollars in December 2021, compared to 31.4 million dollars in December 2020, a decline of about $15.6 million. CAPMAS issued a bulletin, saying that Egypt’s imports from Tunisia amounted to about 4 million dollars last December, compared to 13.4 million dollars in the same month in 2020, a decrease of 9.4 million dollars, followed by imports from Libya, which amounted to about 3 million dollars last December, compared to 5.3 million dollars in the same month in 2020, a decrease of 2.7 million dollars.
The list of countries also included Egyptian imports from Zimbabwe, which amounted to $2.4 million last December, compared to $3 million in the same month in 2020, a decrease of $600,000. As for the rest of the COMESA countries, imports from them declined and amounted to $600,000 last December, compared to $9.7 million in the same month in 2020, a decrease of $9.1 million. The Egyptian exports to the Arab countries amounted to about 929.6 million dollars last January, while they were 886.3 million dollars in January 2021, an increase of about 43.3 million dollars.
African Competition Increases as Hapag Develops New Terminal in Egypt (The Maritime Executive)
Recovery of growth, incomes, and human development: Update on Niger’s economic situation (World Bank)
The combination of the COVID-19 pandemic with the climate and security crises has had a particular impact on Niger’s health indicators. A large and growing proportion of Niger’s population is in poor health. Restoring public health priorities and resuming economic growth are essential conditions for sustainably financing increased health spending and achieving better health outcomes.
Seychelles: African Development Bank approves $20mln loan to support Covid-19 recovery (ZAWYA)
The Board of Directors of the African Development Bank Group has approved a $20 million flexible loan to finance Seychelles’ Governance and Economic Reforms Support Program, expected to help drive the island nation’s macroeconomic stability and recovery from Covid-19 in the medium-term.
The government program aims to deepen reforms introduced through the Bank’s Covid-19 Crisis Response Budget Support Program, approved in June 2020 for $10 million. These reforms are expected to advance fiscal sustainability, improve the business environment and Seychelles’ climate change and environmental resilience.
“The facility comes at an opportune time and will provide much-needed relief given the economic hardship we are faced with in light of the Covid-19 pandemic. It will help the government meet the current budgetary financing gap and help achieve economic development targets as we steer the country on the path to recovery and debt sustainability,” Seychelles’ Minister of Finance, Trade, Investment and Economic Planning, Naadir N.H. Hassan said.
African trade news
SADC to adopt public finances model law (New Era)
Standing committees of the SADC Parliamentary Forum and the Regional Women’s Parliamentary Caucus have unanimously endorsed a draft SADC Model Law on Public Financial Management, and will soon commend it to the highest decision-making body of the forum, the plenary assembly, for adoption. The endorsement happened at the end of a two-day consultation over the draft Model Law on PFM that took place in Johannesburg, South Africa, recently. The validation was the climax of a series of similar engagements with different stakeholders over several weeks, as the SADC PF sought the buy-in and strengthening of the model law, the first of its kind in the world.
Musokotwane, who was a member of the forum as an MP between 2011-2021, said the PFM Model Law or related laws must have provisions for the participation of all stakeholders to provide checks and balances regarding the utilisation of funds and their impact. ”In this regard, the legislation must provide the MPs either individually or through committees of parliament the necessary voice and powers to check what impact is being created by the money that has been spent, otherwise you risk money being expended but other things taking place,” he noted.
Newly launched E-commerce platform seeks to link SMEs to W.African market (Capital Business)
Small and Medium Enterprises in Africa are set to benefit from a newly launched E-commerce trading platform aimed at promoting intra-Africa trade. Ancestral House Eastern Africa online trading platform which has its offices in Abuja and Nairobi is aimed at enabling traders to access East and West African markets. This new platform will offer services such as business matchmaking, market research, logistics, consumer trends, and behaviors.
Ose Imoukhuede, the firm’s chairman, said: “The biggest challenge most SMEs in the continent face is that they cannot easily export goods within the continent, but they can easily export and import goods from other continents despite the Intra Africa trade potential being over USD 1 billion annually... There are a number of challenges facing the SMEs sector in the continent ranging from lack of market information, inexperienced exporters/importers, poor logistics infrastructure, inefficient cross-border payment systems/infrastructure, cultural differences, gaps, trust deficit, and varied Competitive landscape. We want to be the one-stop solution for all these problems and enable them scale up their businesses.”
Fintech solutions empower African SMEs with financing alternatives (Trade Finance Global)
AfCFTA: Insecurity, infrastructure deficiency threaten regional trade – WACTAF (The Sun Nigeria)
The West African Association for Cross-Border Trade, in Agro-forestry-pastoral, Fisheries products and Food (WACTAF) has lamented insecurity and infrastructure deficiency, saying they are threats to Africa Continental Free Trade Agreement (AfCFTA).
In a presentation by its President, Alhaji Salami Alasoadura, infrastructure deficiency and insecurity were major hindrances to cross-border trade in the West African corridor and have posed setback in the distribution of agricultural products, goods and services. He bemoaned lack of connectivity between Customs commands and their stations along the borders, noting that there were no stable policies on banned goods, export levy on agricultural produce, multiple transit levies along the corridors.
Africa must be dependent on its own financial resources for sustainable dev’t – Akufo-Addo (New Ghana)
President Of The African Development Bank President Nana Addo Dankwa Akufo-Addo has underscored the need for Africa to be dependent on its own financial resources for sustainable development. According to the President, the continent must not rely on external development assistance for its development but find ways to expand the capital base of regional financial institutions like the Africa Development Fund (ADF), to make them significant in the scheme of things.
Dr Adesina is on day’s visit to Ghana ahead of the Bank’s 2022 Annual Meetings which would be held in Accra from May 23 to 27. The meetings, which will be attended by several African leaders, will be held on the theme: “Achieving Climate Resilience and a Just Energy Transition for Africa.” It will address climate change and energy transition challenges of the continent, as well as make a case for sustained replenishment of the ADF and for the fund to be allowed to use its equity leverage more resources for the African continent.
Debt distress in Africa: biggest problems, and ways forward (The Conversation)
Fostering Regional Cooperation for Sustainable Oil Production (East African Business Week)
Following the announcement of the Final Investment Decision (FID) in February 2022, and the recent accession of the Democratic republic of Congo (DRC) into the East African Community (EAC), the case for regional and international cooperation in the sustainable exploitation of natural resources has never been stronger. This is primarily because the East African Crude Oil pipeline (EACOP) project not only traverses Uganda and Tanzania but is designed to be a regional pipeline with potential linkages to DRC and South Sudan.
This is an exciting period for the EAC considering that Uganda is transitioning from exploration to the development and production of its petroleum resources with a project investment estimated at about $15-20Bn. The Republic of Tanzania Liquified Natural Gas (LNG) project is estimated at $30bn, while Kenya and the DRC are also undertaking exploration activities in their respective provinces. South Sudan (which is currently an observer at the EAC) is already producing and exporting crude oil via pipeline from Hegleig and Paloch to Khartoum and then to Port Sudan. Mozambique, which falls within the Western Rift Valley, is already developing its LNG project after a Final Investment Decision (FID) for a $20bn project. The East African potential cooperation is a great opportunity to lift the EAC people from poverty. This, however, will require synergies from government entities, including the regulators, in order to lay strategies and develop policies that maximise value retention in the region through National Content.
Stakeholders Discuss Gas Monetization and Energy Poverty During Oil Industry Business Forum In Equatorial Guinea (Social News XYZ)
As global pressures mount to transition to cleaner sources of fuel, Africa continues to struggle with high energy poverty and slow rates of economic growth. To mitigate this, and correspondingly reduce carbon emissions, Africa is committed to utilizing every energy resource at the continent’s disposal, and natural gas has emerged as the most suitable. In regard, speakers during a panel at the Malabo Business Breakfast discussed energy transition, energy poverty and gas monetization.
As Equatorial Guinea progresses with its national development plan to capture domestic and regional gas reserves, processing these reserves and then distributing them across Africa, the speakers emphasized the progress made as well as the role gas-to-power will play in electrifying Africa. According to Berniko, “If you look at Africa, there are great gas opportunities that can be used for production through power plants to turn gas into electricity. Equatorial Guinea has about 67% energy access. We have done a great job since 2012 and the turbogas plant has added to this and has developed the use of natural gas for local consumption.”
With gas-to-power playing a role in addressing energy poverty in Africa, the panel discussed the intersection of energy poverty and energy transition, emphasizing that Africa needs to prioritize economic development before the continent transitions to renewables.
A new report co-authored by the African Development Bank and the Global Green Growth Institute, has found evidence of growing political commitment to green growth in Africa. The Africa Green Growth Readiness Assessment Report was launched on Wednesday during a side-event at the 15th session of the Conference of the Parties (COP15) of the United Nations Convention to Combat Desertification, being held in Abidjan from 9 to 20 May.
he study focused on an in-depth analysis in seven countries, namely Gabon, Kenya, Morocco, Mozambique, Rwanda, Senegal, and Tunisia. The findings are based on nine strategic and operational dimensions, including political commitment, policy and planning, and financing & budgeting. The authors define green growth as “the means to promote and maximize opportunities for sustainable economic development through building resilience and managing resources efficiently…”
The assessment found evidence that African leaders are actively championing the UN Sustainable Development Goals and simultaneously implementing the nationally determined contributions, a component of the Paris climate treaty. In addition, Kenya, Morocco and Tunisia have enshrined the fundamentals of green growth, including the right to a clean and safe environment and citizens’ right to consultation, in their constitutions. The governments of Rwanda, Kenya, Morocco, Senegal and Mozambique have adopted green growth and climate-resilient economic strategies.
Africa pivots to cheaper wheat alternatives (The Herald)
Global wheat prices are so high that African consumers are starting to ditch the grain from their diet. Food producers in Kenya, Egypt, Democratic Republic of Congo, Nigeria and Cameroon say they’re mixing cheaper alternatives into their breads, pastries and pastas. Local rice, manioc flour and sorghum are substituting for wheat, which has spiked about 40 percent this year as Russia’s invasion squeezed exports from Ukraine, one of the biggest shippers. These domestic crops are less exposed to trade disruptions and global inflation, thus offering some protection from food prices that remain near record levels. Kenya imports about 44 percent of its wheat from the Black Sea region, and the surging prices helped stoke inflation to 6,5 percent in April. Unga Group, the Nairobi-based maker of Exe brand wheat flour and Jogoo maize flour, is seeing a shift in sales to its Amana line of rice and pulses.
COVID-19, Conflict in Ukraine wake up call for Africa on food production, say Buhari, Adesina (Vanguard)
President Muhammadu Buhari, Monday, said that the effects of COVID-19 and the conflict in Ukraine were a wake up call on the Africa continent to collaborate amongst themselves for sustainable food production. The same position was canvassed by the President of African Development Bank, AfDB, Akuwunmi Adesina.
Both men spoke at first Conference of Speakers and Heads of African Parliament in Abuja with the theme “Enhancing Africa’s post-covid economic recovery through parliamentary leadership” where the speaker of the House of Representatives, Femi Gbajabiamila said that insecurity was becoming a biggest threat to the future of Africa children.
Declaring the even open, President Buhari who was represented by Vice President Yemi Osinbajo emphasized the need for the African countries to collaborate for the common cause of achieving self sufficiency in food production. He said: “We also need to leverage on technology to build stronger systems for the protection of all. Our legislations across the continent must be designed to forge technology and technology innovations. This has been encouraged in Nigeria and since 2015, there are at least seven high tech companies valued at over one billion dollars each. Many of our countries have also seen the rise of some of these kind of companies and some are even licensed in our different countries. But we must look for continent wide legislation that makes the world
Middle East and North Africa: Embracing Modern Solutions to Ensure Better Food Security (AgriBusiness Global)
The Russian invasion of Ukraine is having negative impacts on a global scale. For the Middle East and North Africa (MENA) region, the war is worsening an already bad situation of food insecurity. In Egypt, where bread is one of the staple foods, the country imports 80% of wheat from Russia and Ukraine. In 2020, Egypt imported 8.2 million tonnes of grain from Russia alone. With the invasion, which has triggered a surge in controls on food export across the globe, the country faces skyrocketing prices for grain, making it unaffordable for Egyptian consumers. This situation is not unique to Egypt. Across MENA, the largest food importing region in the world, the perennial challenge of food insecurity is deepening. Notably, on average more than 50% of the food consumed in the region is imported. In some countries, like the United Arab Emirates, 90% of food needs are met by other countries.
“We are extremely concerned about the millions of people in this region who are already struggling to access enough food because of a toxic combination of conflict, climate change, and the economic aftermath of COVID-19,” says Corinne Fleischer, World Food Program Regional Director for the Middle East and North Africa.
She adds that the knock-on effect of the Ukraine crisis is adding further strain to the import-dependent region with the prices of wheat flour and vegetable oil — two key staples in the diet of most families — rising across the region. Cooking oil is up 36% in Yemen and 39% in Syria. Wheat flour, on the other hand, is up 47% in Lebanon, and 15% in Libya.
For the region, it is becoming increasingly critical to adopt modern plant science solutions and embrace the use of innovation and technology for a more sustainable model of agriculture to improve the incomes and livelihoods of farmers and contribute decisively to food security.
Asian African Chamber celebrated 4th Leadership Forum and signed MOUs worth USD 200 Million in Trade and Investment in Africa (Devdiscourse)
Asian-African Chamber of Commerce and Industry (AACCI) organized the prestigious 4th Asian African Leadership Forum 2022 in New Delhi on Sunday, 24th April at India International Centre which consisted of a grand summit, leadership awards and B2B networking amongst diplomats and industry leaders.
Apart from the participation of over 100 professionals from 25 plus industry sectors and special guests from the film and fashion industry, the Forum witnessed the presence of Dadang Hidayat, Minister Counsellor of Indonesia and CR Chaudhary - Ex-Minister - BJP, Department of Consumer Affairs, Food and Public Distribution. All the distinguished dignitaries emphasized the role of Africa and Asia in the next economic boom, joining hands to surprise the developed world. An encouraging panel discussed, ‘Measures taken to counter the effects of COVID on Business and Economy’ and explored the areas where the countries in the two continents could become complementary to each other’s strengths and weaknesses. Dr Parin Somani - Educator, Motivational Speaker, Author, Humanitarian and Philanthropist; Eleonora Bonacossa - Founder of ARETA New Perspectives for Leaders and Captain Zoya Agarwal - Airline Pilot and UN Women Spokesperson.
Global economy news
Members, partner organizations outline priorities for Aid for Trade Global Review (WTO)
Organized under the theme “Empowering Connected, Sustainable Trade”, this year’s Global Review will look into how to connect the most vulnerable populations to international trade — the digital economy in particular — and how developing economies can use trade to boost economic growth, meet development objectives and build resilience. Special emphasis will be placed on green initiatives and climate change. The WTO-led Aid for Trade initiative seeks to mobilize resources to help developing countries and least-developed countries (LDCs) overcome trade-related constraints that limit their participation in international trade.
Xiamen launches BRICS event to further deepen economic, trade cooperation (PR Newswire)
As a city that hosted the ninth BRICS summit in 2017, Xiamen in Fujian province launched a serial event on April 28, aiming to showcase the special commodities and humanities of BRCIS countries – China, Brazil, Russia, India and South Africa, as well as the huge opportunities and opening-up of the large Chinese market.
The serial event is seen as an important supporting event for the BRICS China Year in the field of economy and trade, which is designated to give full play to the advantages of both online and offline platforms to boost consumption. The online platform, which relies on the online CIFIT (China International Fair for Investment and Trade), displays BRICS countries’ products and latest information, and is connected to major e-commerce platforms for the sales of BRICS products. The Xiamen cross-border e-commerce industrial park created an 800-square-meter service center for products from the BRICS countries on the offline platform. Over 700 products from BRCIS countries have been collected so far by the center.
7 sustainable finance challenges to fix global inequality (WEF)
Despite the recent surge in global demand and supply of sustainable finance, the financing gap for the Sustainable Development Goals (SDGs) has actually widened, primarily in countries already furthest behind on the 2030 Agenda. Is it just a consequence of the COVID-19 crisis? Or has the system failed to channel sustainable finance to where it is most needed?
The mainstreaming of sustainability in finance and investment is an opportunity to seize and a trend to encourage. However, early evidence suggests that inequalities remain, and unintended consequences, unless acted upon, could actually slow down our collective progress towards the SDGs. Here are seven risks or challenges that require our urgent attention, and suggestions on how to mitigate them.
War in Ukraine and Omicron Weighs on Air Cargo (IATA)
The International Air Transport Association (IATA) released March 2022 data for global air cargo markets showing a drop in demand. The effects of Omicron in Asia, the Russia – Ukraine war and a challenging operating backdrop contributed to the decline. Global demand, measured in cargo tonne-kilometers (CTKs*), fell 5.2% compared to March 2021 (-5.4% for international operations).
Several factors in the operating environment should be noted: The war in Ukraine led to a fall in cargo capacity used to serve Europe as several airlines based in Russia and Ukraine were key cargo players. Sanctions against Russia led to disruptions in manufacturing. And rising oil prices are having a negative economic impact, including raising costs for shipping. New export orders, a leading indicator of cargo demand, are now shrinking in all markets except the US. The Purchasing Managers’ Index (PMI) indicator tracking global new export orders fell to 48.2 in March. This was the lowest since July 2020. Global goods trade has continued to decline in 2022, with China’s economy growing more slowly because of COVID-19 related lockdowns (among other factors); and supply chain disruptions amplified by the war in Ukraine.
“Air cargo markets mirror global economic developments. In March, the trading environment took a turn for the worse. The combination of war in Ukraine and the spread of the Omicron variant in Asia have led to rising energy costs, exacerbated supply chain disruptions, and fed inflationary pressure. As a result, compared to a year ago, there are fewer goods being shipped—including by air. Peace in Ukraine and a shift in China’s COVID-19 policy would do much to ease the industry’s headwinds. As neither appears likely in the short-term, we can expect growing challenges for air cargo just as passenger markets are accelerating their recovery,” said Willie Walsh, IATA’s Director General.
Shipping industry reports 54 losses in 2021 amidst challenges: Allianz (Logistics Update Africa)
The global shipping industry continued its long-term positive safety trend in 2021 with 54 reported total losses (till March 1, 2022) compared with 65 last year, according to the Safety and Shipping Review 2022 report by Allianz Global Corporate & Specialty (AGCS).”Annual shipping losses have declined by 57 percent over the past decade since 2012 (127), while 2021 represents a significant improvement on the rolling 10-year loss average (89), reflecting the increased focus on safety measures such as regulation, improved ship design and technology and risk management advances. “The 2021 loss is more impressive due the fact that there are an estimated 130,000 ships in the global fleet today compared with some 80,000 some 30 years ago. Cargo vessels accounted for half of all vessels lost in 2021 (27). Foundered (sunk) was the main cause of total losses across all vessel types during 2021, accounting for around 60 percent (32). Fire/explosion ranked second (15 percent, 8) with machinery damage/failure third (11 percent, 6). Extreme weather was reported as being a factor in at least 13 losses during 2021, the report said.
Howden Launches End-to-End Digital Trading Platform for Cargo Risks (Insurance Journal)
UNDP calls for policies to support informal sector’s resilience, performance (The Herald)
The United Nations Development Programme (UNDP) has called on African countries to adopt transformative policies to improve the informal sector’s resilience and performance that remains vulnerable to various shocks.
In his opening remarks in Victoria Falls on Tuesday during a two-day policy dialogue on the informal economy in Africa, UNDP Zimbabwe country office senior economist, Mr Ojijo Odhiambo said: “The Covid-19 pandemic has brought to the fore the vulnerability of workers and enterprises in the informal economy and the significant contribution the informal economy makes to income, and employment in Africa, and how extricably it is linked to the rest of the whole economy. “We must, therefore, begin to think of counter policy narratives that challenge the status quo and unleash the immense potential of the informal economy.” Such transformative policy narratives can be implemented by collectively learning and building intelligence on how to sustainably support the informal economy – including through an enabling environment for transition to formality and decent work − so it can play a formidable role in Africa’s inclusive, sustainable, resilient and prosperous future with a special focus on people-centred recovery from the Covid-19 crisis.
Think tank warns of over-reliance on non-democratic states for natural capital imports (Global Trade Review)
Commodity trade disruption in the wake of the Russian invasion of Ukraine is pushing sovereign states to seriously reflect on the type of governments with which they trade, exposing the dubious source of many western nations’ nature-based imports, according to new research by Planet Tracker.
While governments in Europe and the US scramble to replace Russian oil and gas imports following the introduction of sanctions designed to deprive the country of the economic resources it uses to continue its aggression against its neighbour, the UK-based non-profit financial think tank warns that a wider look at natural capital trade is needed to ensure countries are not exposed to further sudden disruptions caused by non-democratic actors.
Here’s what’s happening at COP15 (Landscape News)
Global leaders are meeting to figure out how to stop terrestrial lands from losing their health and fertility, particularly due to desertification and drought, at the 15th edition of a UN-led conference. Delegates have met in Abidjan to share what’s happening in their countries and sectors and advocate for the funding, policy and support needed most to fight land degradation on their home turf. This start of the COP is when many of major ‘moments’ of the two weeks have been made, so before things progress any further, here are some notes from the floor:
A hallmark report released by UNCCD in advance of the COP – the Global Land Outlook 2 (GLO2) – is serving as the scientific foundation for discussions. Among other staggering facts, the report found that 40 percent of all ice-free land is degraded, which has direct consequences on half of humanity and poses risks for half of global GDP.
The need for gender equity is front and center. Eighty percent of employed women in most least-developed countries rely on agriculture for their livelihoods, but few own their land – for example, only 5 percent in the Middle East and North Africa. The event opened with its second-ever Gender Caucus examining policy, finance and activism in this sector, and the launch of a new report on the gendered effects of desertification and drought.
The first two days ended with the “Abidjan Call” – a collective assertion from leaders stressing the need to make drought an issue of highest global priority and to continue working toward a net-neutral level of annual land degradation by 2030.
Commonwealth needs to be a loud voice for action on climate: Prime Minister of The Bahamas (The Commonwealth)
UN organizations launch plan to catalyse action by 2025 on energy commitments (UN DESA)
Against the backdrop of a global energy crisis and worsening climate emergency, today the UN took a major step to catalyse the large-scale action and support needed for the transition to clean, affordable energy for all and net-zero emissions, with the launch of a Plan of Action by some thirty leading organizations comprising “UN-Energy”.
Speaking of the interlinked triple crises of energy, food and finance arising from the war in Ukraine, UN Secretary-General António Guterres recently stated that “we can maximize this moment to push for the transformational change our world needs.” He added that “now is the time to turn this crisis into an opportunity,” to work towards progressively phasing out coal and other fossil fuels, and accelerating the deployment of renewable energy and a just energy transition, to address our worsening climate emergency.
An Energy Compact Action Network was also launched to match those governments seeking support for their clean energy goals with those governments and businesses that have pledged over $600 billion to support these commitments.
Every year, timber exported from the Congo Basin provides livelihoods to local communities. The forestry sector is essential to regional economies. With some of the world’s richest biodiversity hotspots, the Congo rainforest is home to approximately 10,000 species of tropical plants, 30 per cent of which are unique to the area. Not to mention, as the world’s second-largest tropical rainforest, holistic Nature-Based Solutions involving these local communities, will be vital to mitigate and adapt to climate change. Yet surging demand for tropical wood, primarily from Asia but also from Europe and America, exacerbated by corruption, resource mismanagement, and ineffective regulation, is making it all too easy for criminals to harvest and trade in threatened timber illegally. And it’s not just the Congo Basin; estimates suggest that forestry crimes, including corporate crimes and illegal logging, account for US51 – 152 billion annually worldwide.
STDF partners explore impact of climate change on the global food system (WTO)
Climate change is a major disruptor of the global food system, changing the way food is produced, processed, stored and distributed. Extreme weather events, droughts and rising temperatures affect distribution patterns of pests and diseases and contribute to increased and new SPS risks. Climate Change Week showcased how trade is closely linked to the effects of climate change on the world’s food supply. As agro-climatic zones shift, new regions will face food deficits, requiring increased trade to meet demand. At the same time, unsafe trade can be a pathway for the spread of pests and diseases to new regions.
“Whatever action we take, the solutions will have to be tailored to each region, country and sector, with a focus on supporting producers and regulators in developing countries,” said Jean-Marie Paugam, WTO Deputy Director-General, at the closing seminar on 6 May. “The key to building long-term climate resilience, through risk management strategies, regulatory updates, awareness raising and other ways, is partnerships.”
Explainer: As conflict and climate change bite, are high food prices here to stay? (TODAY)
Remittances to Reach $630 billion in 2022 with Record Flows into Ukraine World Bank)
Officially recorded remittance flows to low- and middle-income countries (LMICs) are expected to increase by 4.2 percent this year to reach $630 billion. This follows an almost record recovery of 8.6 percent in 2021, according to the World Bank’s latest Migration and Development Brief released today.
During 2021, remittance inflows saw strong gains in Latin America and the Caribbean (25.3 percent), Sub-Saharan Africa (14.1 percent), Europe and Central Asia (7.8 percent), the Middle East and North Africa (7.6 percent), and South Asia (6.9 percent). Remittances to East Asia and the Pacific fell by 3.3 percent; although excluding China, remittances grew 2.5 percent. Excluding China, remittance flows have been the largest source of external finance for LMICs since 2015.
The top five recipient countries for remittances in 2021 were India, Mexico (replacing China), China, the Philippines, and Egypt. Among economies where remittance inflows stand at very high shares of GDP are Lebanon (54 percent), Tonga (44 percent), Tajikistan (34 percent), Kyrgyz Republic (33 percent), and Samoa (32 percent).
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Covid-19 sets SA auto industry back three years in achieving masterplan targets (Moneyweb)
The Covid-19 pandemic has put South Africa’s automotive industry back by about three years in achieving the “aspirational and ambitious targets” set for the industry in the SA Automotive Masterplan 2021 to 2035. This has resulted in the industry considering approaching the Department of Trade, Industry and Competition (dtic) for an early review of the masterplan despite the industry achieving some new export performance records in 2021. Mzwake Mbatha, policy analyst at the dtic, asked during a briefing on the export achievements in 2021 if the industry is still on track to fulfil the 2035 targets.
Vehicle and automotive component exports increased by 18.1% to a record R207.5 billion in 2021 from the R175.7 billion in 2020 to comprise 12.5% of total South African exports. Vehicle exports increased by almost 9.8% to 298 020 units in 2021 from the 271 287 vehicles exported in 2020 while the export value increased by 14.1% to R138.3 billion from R121.2 billion in 2020. Automotive component exports increased by a substantial R14.7 billion, or 27%, to a record R69.2 billion in 2021 from R54.5 billion in 2020.
Imports of original equipment components by the seven original equipment manufacturers (OEMs) in South Africa increased by 33.8% R110.1 billion in 2021 from R82.3 billion in 2020. Lamprecht said this was in line with the 11.8% year-on-year increase in vehicle production in 2021 and to accommodate the introduction of new domestically manufactured models.
Minerals Council spells out members’ commitment to climate change mitigation (Engineering News)
Members of Minerals Council South Africa have agreed to commit to a climate change response strategy that will reduce Scope 1 and Scope 2 emissions and achieve a net zero emission by 2050 or earlier. Minerals Council South Africa senior health and environment executive Nikisi Lesufi on Tuesday briefed the media on the Mineral Council’s dual approach to energy, explaining that it is a common but differentiated approach.
Removing mining growth impediments top of govt’s agenda (SAnews)
President Cyril Ramaphosa says government understands the need to move with urgency to remove the red tape that stands in the way of the mining industry’s growth and development. “It is a matter of grave concern that South Africa has fallen into the bottom 10 of the Fraser Institute’s Investment Attractiveness Index rankings. We are currently standing at 75th of 84, which is our worst-ever ranking. ”This ranking underlines the fundamental reality that South Africa needs to move with greater purpose and urgency to remove the various impediments to the growth and development of the industry,” he said.
New infrastructure vulnerable to climate change owing to mismanagement, corruption (Engineering News)
New infrastructure was just as vulnerable to climate change as ageing infrastructure, said South African Local Government Association (Salga) senior climate change adviser Slindile Maphumulo on May 10. She explained that, while ageing infrastructure was vulnerable to being damaged or destroyed during extreme weather events, new infrastructure was equally at risk as a result of being built poorly, slowly or not at all owing to poor tender systems, the appointment of incompetent service providers and contractors, black economic empowerment systems, inexperienced engineers and, most of all, rampant corruption.
Commodity prices buoy South Africa amid China’s slow growth blow (Mail & Guardian)
The world’s economy was dealt a heavy blow by Russia’s assault on Ukraine. The war prompted the International Monetary Fund (IMF) to cut its global growth expectations, while inflation began to heat up well beyond what some central bankers are willing to endure. Meanwhile, another threat to the global economy is also raising eyebrows: China’s growth, which has been put on the line by its government’s uncompromising approach to containing Covid-19. South Africa’s economic fate is closely tied to China, which imports the highest percentage of the goods produced by Africa’s southernmost country. But still-elevated commodity prices could keep South Africa from being pulled down by China’s slowed growth.
UK extends support to bolster SA’s capacity to deliver infrastructure projects (News24)
State capacity to deliver infrastructure projects will be bolstered with the support of the UK government - this after the UK and South African governments extended a Memorandum of Understanding (MoU) to support the latter’s National Infrastructure Programme 2050. Government has, in recent years, faced mounting pressure over public infrastructure delivery. UK Minister for Exports and Minister for Equalities, Mike Freer, and South Africa’s Minister of Public Works and Infrastructure, Patricia de Lille, signed the MoU at the British High Commissioner’s residence in Bishopscourt, Cape Town, on Monday. The UK Infrastructure and Projects Authority (IPA), a body which conceptualises projects and then sees them through to execution, and Infrastructure South Africa (ISA) - a programme within the Department of Public Works and Infrastructure (DPWI) that supports the planning, management, and delivery of projects - are both involved in the partnership.
Supply Chain Latest: Namibian Port Expands as Alternative Trade Hub (Bloomberg)
Namibia’s Port of Walvis Bay has been expanding over the last few years and is set to get bigger with plans by the southern African country to develop its energy sector. The country, famous for its Skeleton Coast strewn with shipwrecks, built out its main port with a $300-million container terminal project that more than doubled capacity. That was completed in 2020 while Namibia was still struggling with the effects of the global pandemic. Other areas of the hub handle flows of salt, copper, coal, mining equipment and fuel.
Walvis Bay serves as an alternative to the ports of Dar es Salaam in Tanzania and Durban in South Africa for delivering the supplies and commodities from landlocked areas in the southern region.
The port will see another development following the award of a contract to build a liquid petroleum gas import, storage and distribution terminal, Namibian Ports Authority CEO Andrew Kanime said last month at an oil conference in Windhoek, the capital. The hub will need to be cost competitive to drive traffic, he said.
Positive pointers from Namibian trade stats (The Namibian)
NAMIBIA continues being a net importer of goods with the value of exports increasing by 27,9% year on year (y/y) in March 2022 to N$6 billion, while the value of imports increased with 18,3% y/y in March to N$8,9 billion, resulting in a trade deficit of N$2,9 billion.Simonis Storm Securities in an analysis says export products during the month were mainly from the manufacturing sector, which constituted 70,3%, mining (24,0%) and agriculture (4,8%), and were mainly destined for the rest of Africa (62,0%), Europe (21,7%), Asia (12,7%) and the United States (3,5%). “On average, exports increased by 24,4% in 1Q2022, compared to 1Q2021, where February 2022 recorded the highest annual growth in exports in the last two years,” Simonis says.
Simonis says 2021 recorded trade deficits for nine out of 12 months. According to the analysis, the biggest contributors to exports in March 2022 were diamonds, which rose 40,3% y/y, fish, which dropped 13,6% y/y, inorganic chemicals 355,6% y/y, gold, which rose 35,2% y/y, and copper blisters, which rose 1,178,2% y/y. However, Simonis says 99% of diamonds, and 20% of copper blister exports in March 2022 were re-exports.
Kenya’s mobile money transactions surge by 63% in 2021 — report (Business Insider Africa)
According to data provided by the Kenya National Bureau of Statistics, the number of total mobile money transactions recorded a 16 per cent jump to 2,165 million, while the total transfers grew from 5.2 billion to 6.8 billion. Similarly, the number of money agents rose by 44 per cent from 3.231 billion to 4.666 billion, while the transfer from subscriber to subscriber rose by 30 per cent from 3.234 billion to 4.191 billion. The perceived growth in the volume of mobile money transactions in Kenya also spurred an increase in the country’s total active mobile money agents. According to the Kenya National Bureau of Statistics, the active mobile money agents increased from 264,390 to 292,301, and the mobile money transfer service subscribers rose from 32 million to 35 million.
Globally, Kenya and Ghana continue to dominate the mobile money market as the two countries rank second and third after China in the highest mobile payment usage, according to a 2020 report by American research firm Boston Consulting Group (BCG).
Kenya breaches duty-free sugar imports cap by 102pc (Business Daily)
The Sugar Directorate exceeded the sugar import limits set by the National Treasury last year by 102 percent despite a significant increase in production of the commodity. Data from the Kenya National Bureau of Statistics (KNBS) shows that the directorate issued permits that allowed the importation of 426,000 tonnes against 210,000 tonnes –the limit that was put in place for duty-free sugar. The Treasury had in March last year slashed the amount of sugar that can be imported tax-free from the Common Market for Eastern and Southern Africa (Comesa) countries by a third as the government moved to tame the influx of the cheap sweetener following an outcry from farmers. The Treasury said imports that exceeded the set limit would attract 100 percent duty, effectively protecting farmers and local sugar processors from rogue importers.
Samia visit: Tanzania makes U-turn on Uganda sugar (The East African)
Tanzania will resume buying sugar from Uganda, signalling a relaxation of one of the trade disputes that has lasted close to three years. President Samia Suluhu, during day one of her two-day state visit to Uganda, agreed with her host President Yoweri Museveni that Kampala would also supply her country with anti-retroviral (ARVs) drugs. According to a joint communiqué released after the Presidents’ meeting on Tuesday evening, Uganda will supply 10,000 tonnes of sugar to fill a production gap in Tanzania.
Uganda has, over the years, blamed Tanzania for instituting several non-tariff barriers that have thwarted seamless trade between the two countries. These include restrictions on sugar, milk and movement on Ugandan trucks.
Tanzania topples SA as Kenya’s top source of imports in Africa (Business Daily)
Tanzania has become the largest source market for Kenya on the continent after overtaking South Africa, partly on the back of increased orders of maize and rice by millers. Official trade statistics show expenditure on goods trucked from Tanzania nearly doubled last year to Sh54.47 billion from Sh27.88 billion the year before. The 95.38 percent, or Sh26.59 billion, bump in imports catapulted Tanzania to the top position in Africa after orders from South Africa fell 3.72 percent to Sh44.08 billion, according to data collated by the Kenya National Bureau of Statistics (KNBS).”Imports from Tanzania nearly doubled from Sh27.9 billion in 2020 to Sh54.5 billion in 2021 partly attributable to increase in imports of maize and rice from this country,” KNBS analysts wrote in the Economic Survey 2022.
Tanzania: Multibillion dollar Chinese investment to increase job creation (The Exchange)
Investment in Tanzania is changing the labour market and industries in Tanzania for the better. The government of Tanzania is doubling down on expanding its industrial complex as the new industrial scheme stands to draw around 100,000 direct jobs and 300,000 by 2025 and change Tanzania economy for good. Tanzania’s industrial economy is slated to expand twelve-fold in the next three years, adding more support to the minor industrial landscape currently operating nationwide, while expanding the list of reasons to invest in Tanzania.
Tanzania’s investment landscape has captured a $3 billion industrial scheme executed by a Chinese company, Sino Tan Kibaha Industrial Park Limited. The Minister told the parliament on Saturday, May 06, tabling the ministry budget for 2022/23. The grand project, expected to complete development in 2024, will be monumental as it will transform Tanzania into an African industrial products hub.
Tanzania is one of the nations within sub-Saharan Africa that has experienced sustained growth due to its deliberate intent to maximize growth in industrial output. Tanzania has continued to showcase promising trends as in 2021, Tanzania exports to China rose by 14.31 percent, equivalent to $273.1 million, sending oily seeds, tobacco, and cotton to China markets.
Tanzania’s trade to the Indian market has also surged to 90 percent in 2021, which is more than $1 billion, shipping minerals, cashew nuts, soy and peas. While in Japan, Tanzania has progressed with more positive trends, increasing trade by 20.97 percent, which is $60.7 million in 2021. However, Tanzania’s trade with European Union got scarred, recording a 41.89 percent decline. At the same time, Tanzania traded with the Southern African Development Community. (SADC) reduced to 10.06 percent, which is around $1.3 billion in 2021. On the other side, Tanzania’s trade with the East African Community increased by 43.73 percent, equivalent to around $1.161 billion in 2021
Further, the Minister pointed out that the government is eyeing the introduction of the Trade Remedies Act of 2022 as a deliberate effort to enhance the business environment in Tanzania.
Tanzania’s exports to Kenya hit highest level recorded since independence (The Exchange)
The improved relationship between Kenya and Tanzania seems to be bearing fruits if the Kenya National Bureau of Statistics (KNBS) data is anything to go by. In its Economic Survey 2022, the statistics office indicates that Tanzania’s exports to Kenya doubled in just ten months, the highest figure recorded since independence. According to the survey, Kenya’s imports from Tanzania nearly doubled from $242.6 million in 2020 to $473.9 million in 2021. The survey attributed the rise to increased imports of maize and rice from Tanzania.
Kenya imported more goods from Tanzania in 2021 than before, despite the COVID-19 pandemic affecting trade in the region and globally. The survey revealed that Kenya opened its market to receive agricultural products from Tanzania amid the pandemic that affected its stock.
The survey also found that Kenya’s exports to Tanzania and the Democratic Republic of Congo showed a significant rise, jumping from $276.5 million and $124.3 million in 2020 to $396.5 million and $212.2 million. The bureau attributed the increase to the export of cut flowers, tea and coffee to DRC and soap to Tanzania. Overall, Uganda remained the highest export market for Kenyan goods in 2021, despite trade disputes between Nairobi and Kampala.
DRC State-owned shipping line to set base in Mombasa (Business Daily)
A shipping line from the Democratic Republic of Congo plans to start its operations from Mombasa beginning June this year. The state-owned shipping line, the Lignes Maritimes Congolaises (LMC) seeks to channel more DRC imports and exports cargo through the Port of Mombasa. A delegation from DRC led by the shipping line director LMC Dr Banze Nkulu Mulunda agreed to open an office at the Mombasa port to coordinate imports and exports from their country. “After a discussion on operational and logistics issues with KPA container terminal principal operations officer Michael Bokole and his team, we have agreed to start our operations from Mombasa starting next month. This will help in creating more jobs and business opportunities not only for DRC but to Kenya,” said Dr Mulunda.
Nigeria, 10 ECOWAS countries in debt distress – Report (Punch Newspapers)
A new report by the Nigerian Economic Summit Group and the Open Society Initiative for West Africa has disclosed that Nigeria and 10 other Economic Community of West African States countries are currently in debt distress based on debt sustainability analysis. The 10 other countries are Benin, Burkina Faso, Cabo Verde, the Gambia, Ghana, Guinea Bissau, Liberia, Niger, Senegal, and Togo. The report, titled ‘Debt Management, restricting and Sustainability in ECOWAS’, was recently launched at the Debt Management Office in Abuja.
According to the report, a financial crisis in Nigeria can threaten other countries in the ECOWAS region. “We also find that a financial catastrophe occasioned by a debt crisis in one country may spread throughout the region. The financial woes in Nigeria, in particular, portends a serious threat to other nations in the region.”
EU, Nigeria trade volume hits €28.7 billion (People’s Gazette)
Samuela Isopi, the ambassador to the EU delegation to Nigeria and ECOWAS, has put the trade volume between the bloc and Nigeria in 2021, at €28.7 billion. The envoy disclosed this at the Europe Day celebration, held at the EU Residence in Abuja.
According to Ms Isopi, the EU as a bloc remains Nigeria’s biggest trading partner accounting for more than 20 per cent of Nigeria’s trade with the world. “In 2021 the volume of EU-Nigeria trade stood at 28.7 billion euros, an increase of more than 25 per cent over 2020, with a trade balance of €6.4 billion in favour of Nigeria,” stated Ms Isopi. According to her, the bloc is Nigeria’s first partner in foreign direct investment, with EU companies contributing, together with their Nigerian business partner, to the country’s economic growth, job creation and wealth generation. She said the bloc was looking further in strengthening the relations and to help create the necessary conditions for the private sector to operate and contribute to developing the country.
Revenue target from partial import discount reversal revised to GH¢2.5bn (Graphic Online)
THE government has cut its revenue target from the partial reversal of the reduction in the benchmark values (discount policy) to GH¢2.5 billion from the initial estimated GH¢3 billion. The revised target followed delays in the review of the discount policy occasioned by some initial disagreements between the Association of Ghana Industries (AGI) and the Ghana Union of Traders Association (GUTA) over the implementation of the policy. While the AGI has called for a total review of the policy because it is rendering its members (manufacturers) uncompetitive, the GUTA has said the discount serves as a lifeline to the survival of traders and needs to be maintained after two months of engagements. The Commissioner of the Customs Division of the Ghana Revenue Authority (GRA), Col Kwadwo Damoah (retd), said to resolve the disagreement, the government decided to phase out the discount policy gradually after engaging with stakeholders in the trading and manufacturing industry.
IMF Staff Completes 2022 Article IV Mission to Mauritius (IMF)
“Mauritius is gradually recovering from the pandemic. The public health impact of the pandemic was well managed, including by a remarkable vaccination campaign covering over 90 percent of the eligible population by May 2022. Large and comprehensive support measures helped cushion the social and economic impact of the pandemic.
“While most sectors have returned to pre-pandemic levels of economic activity and the tourism sector is gradually recovering, inflation has picked up substantially. Real GDP growth bounced back to 4 percent in 2021, from a contraction of around 15 percent in 2020.
In face of increasing fuel and food prices, the mission recommends protecting the vulnerable population with targeted transfers through social safety net programs while avoiding broad-based subsidies benefiting all income levels.
Diversifying the economy will remain critical to support the recovery and Mauritius’ aspiration to become a high-income country. To achieve this, the authorities need to consider policy options to reduce the shortage of suitably skilled workers. Greater digitalization should help further promote diversification and move up the value chain. Addressing climate change is another priority to help the economy build resilience against shocks. Diversification and improving the resilience of the economy need to be supported by a comprehensive reform agenda to identify priorities, address obstacles, and increase efficiency, including by finding complementarities between the public and private sectors. This agenda could be formulated in consultation with the private sector and civil society.
A moderate recovery is taking hold. After a real GDP contraction of -1.2 percent in 2020—the first in 30 years—growth resumed in 2021 and is now becoming more broad-based. While COVID cases and deaths have been below regional averages, three large waves of infections in 2021 and 2022 moderated the strength of the recovery. After initial supply constraints, vaccine rollout intensified in late 2021, with 46 percent of the population having received at least one shot (42 percent fully vaccinated by end-March 2022). Poverty has increased from a poverty headcount ratio of 61.9 percent in 2019 to an estimated 63.3 percent in 2020 as a result of the crisis, albeit mitigated by welfare and social protection measures undertaken with international support. The war in Ukraine is pushing up fuel and food prices. Inflation rose to 6.7 percent year-on-year in March 2022 mainly due to rising global prices but also the impact of tropical storms on local food prices. In response, the Bank of Mozambique raised its policy rate 200 basis points in March 2022.
“Mozambique has managed the COVID pandemic relatively well, maintaining macroeconomic stability and reform momentum even as the country has weathered a series of shocks, culminating with the effects of the war in Ukraine. With policy space now limited, sustaining the economic recovery underway and tackling debt vulnerabilities are priorities. The new three-year ECF arrangement of 150 percent of quota (SDR 340.8 million or about US$ 456 million) aims to buttress the economic recovery and policies to reduce public debt and financing vulnerabilities, along with creating fiscal space for priority investments in human capital, climate adaptation and infrastructure. It is also expected to catalyze additional financing by development partners.
Real GDP growth, estimated at 6.2 percent, rebounded in 2021 supported by mining and services, while inflation stood at 5.3 percent at the end of 2021. The current account deficit narrowed to one percent of GDP, thanks to high mining exports. A rebound in the mining sector allowed for a significant increase in gross international reserves, reaching close to US$3 billion or 6.4 weeks of imports at end-2021. The overall fiscal deficit improved to 1 percent of GDP due to higher revenues and lower-than-projected investment.
Notwithstanding significant downside risks, including those related to the war in Ukraine, the outlook for 2022 remains relatively favorable and provides opportunities to consolidate macroeconomic stability. Growth has been revised to 6.1 percent from 6.4 percent. A small current account surplus, driven by higher grants and a relatively stable trade deficit, will support further reserve accumulation. Higher global food and energy prices are expected to weight on inflation and increase current spending due to untargeted fuel subsidies. However, the fiscal deterioration is expected to be contained thanks to strong revenue performance.
Advancing structural reforms remains critical for inclusive growth and social inclusion. Supporting economic activity will require addressing the large infrastructure needs, with strict prioritization and timely implementation of growth-enhancing investment projects. Simplifying the tax system and improving the business climate and governance remain crucial to support economic diversification, mobilize investment, and promote private sector-led growth. The global energy transition provides opportunities, including in mobilizing climate finance.
African trade news
African Members meet to discuss the HS 2022 Implications on the AfCFTA (WCO)
From 20 to 23 April 2022, Members of the African Union gathered for the AfCFTA 6th meeting of the Sub-Committee on Rules of Origin (RoO) to discuss outstanding issues and the draft AfCFTA RoO manual. The meeting was preceded by a one-day workshop on implications of HS 2022 amendments for RoO and schedules of tariff concessions, which was delivered on 19 April.
In his opening remarks, Mr. Mohamed Ali, Director of Trade in Goods and Competition of the AfCFTA Secretariat expressed his appreciation for the support provided by the EU and the WCO on the implementation of the HS under the HS-Africa Programme. He emphasized the importance of ensuring that continued support be provided to the AfCFTA to fully implement HS 2022, and welcomed the opportunity to have a thorough review of the remaining questions. He thanked the Member administrations that were making strides in migrating to the new version of the HS.
During the Sub-Committee meeting, the participants were briefed on the state of play with regard to the AfCFTA Appendix IV on Rules of Origin. The meeting participants had in-depth discussions on outstanding Rules of Origin taking into consideration the implications of the HS 2022. In conclusion of the meeting, it was agreed that the AfCFTA would continue their cooperation with the HS-Africa Programme and the recently established EU-WCO Programme for Rules of Origin in Africa to fully implement and manage Rules of Origin.
Women at the center of Africa’s post-pandemic recovery (Ventures Africa)
As we begin to focus on learnings from COVID-19, it is impossible to overlook the vital contributions of African women whose pioneering responses to the pandemic saved many lives. But as we recognize the women making history today, we must ask: Are we doing enough to ensure more can step forward as leaders and as Africa’s history makers of tomorrow? The answer is “not yet”, and we’d like to propose three for action: empower women in the economy, gather more and better data to see the full picture of women’s lives, and promote women in decision making, policy and governance.
Number of African planes projected to rise sharply (Business Daily)
The projected growth of African economy will push up the demand for aircraft with a new report saying the continent will require at least more than 1,000 new planes delivered by 2040 to meet the travel needs. The 2021 Airbus Global Market Forecast (GMF) report indicates that African airlines will require 1,100 new passenger and freight aircraft deliveries by 2040 in order to meet the growing demand. The new addition will bring the total fleet to 1,440 from a 2019 fleet baseline of 680 aircraft that have been in operation.
“Growth is driven by the forecast 2.8 percent compound annual growth rate (CAGR) increase in GDP between now and 2040. Tourism and intra-regional trade will continue to be key growth sectors for Africa and drive GDP growth,” says the report.
Globally, cargo is already operating today at nine percent above pre-crisis levels, and in Africa at 23 percent, according to IATA. Africa is seen as harbouring huge aviation potential due to limited ground transportation infrastructures, an abundance of natural resources facilitating trade and numerous touristic opportunities.
Over the past 10 years, significant improvements to the industry have been made across the continent, including the creation of the Single African Air Transport Market (SAATM) as well as the modernisation of fleets by national airlines. “Aviation not only gets people moving, but it also fosters regional integration, creates jobs and enables domestic, intra-African and global trade.”
AFRAA, Kenya Airways hold 10th Aviation Stakeholders Convention (Logistics Update Africa)
The 10th Aviation Stakeholders Convention, hosted by the African Airlines Association (AFRAA) and Kenya Airways, brings together over 500 delegates from 47 countries across the globe physically and virtually. The convention under the theme Beyond The Crisis is being held in Nairobi, Kenya. “A total of 34 African airlines are represented at the event with 12 airline CEOs in attendance,” according to an official statement.
Joseph K. Njoroge, CBS, Principal Secretary, State Department for Transport, Government of Kenya added: “Among the industry actions for recovery by airlines is the enhanced cooperation and collaboration. This will establish stronger and more efficient airlines with business models that will allow them to compete internationally and improve Africa’s air traffic market share which is currently very low. “The importance of exchanging knowledge and experiences to inspire a sustainable and resilient aviation was emphasised by Allan Kilavuka, CEO, Kenya Airways. “Covid-19 posed the greatest risk to the aviation sector but we remained resilient as an industry and carried on. Planes continued to fly, delivering tonnes of freight, bringing our people home from overseas, and keeping people connected with their families across the continent. As we fly towards a better future, sustainability will be a key priority for Africa’s aviation sector.”
Poverty and extreme inequality worsen in southern Africa as COVID-19 battered countries embark on a dangerous austerity path (Oxfam International)
The COVID-19 pandemic has worsened the extreme inequality in Southern African Development Community (SADC) countries and pushed millions into poverty, reveals a new analysis from Oxfam, Norwegian Church Aid (NCA) and Development Finance International (DFI). The Commitment to Reducing Inequality Index (CRI) report shows that the fifteen SADC member states lost about $80 billion in 2020 due to lower-than-expected growth. which is equivalent to around $220 for every SADC citizen. This analysis estimates that this economic crisis could take more than a decade to reverse, erasing all hope of countries meeting their national development plan targets to reduce poverty and inequality by 2030.
“The poorest in our societies are bearing the brunt of COVID-19 and are now facing the extra cost of austerity policies. Governments have a choice and must act now to reverse damage of the pandemic, increase social spending and tackle the inequality crisis”, says Felix Ngosa, senior programme officer in Norwegian Church Aid.
The Southern African Development Community (SADC) will on 13th May, 2022 hold a Joint Meeting of Ministers Responsible for Agriculture and Food Security, Fisheries and Aquaculture in Lilongwe, Republic of Malawi. The objective of the meeting is to follow up on the decisions of SADC Summit, Council of Ministers and the Sectoral Committee of Ministers responsible for Agriculture and Food Security, Fisheries and Aquaculture. The meeting will specifically review the food security situation following challenges experienced by the region with regards to excess rains that caused flooding in some parts, cyclones and drought in others; outbreaks of transboundary animal and plant pests and diseases; and developments in the fisheries and aquaculture sector. The meeting will review the implementation of the Regional Agricultural Policy (RAP) and its related programmes including food security, livestock, crops and fisheries and aquaculture; as well as review programmes of work of the SADC Plant Genetics Resources Centre (SPGRC) and Centre for Coordination of Agriculture Research and Development in Southern Africa (CCARDESA).
Ministers will also deliberate on programmes of regional dimension in support of the implementation of the Regional Indicative Strategic Development Plan (RISDP) 2020-2030 and the SADC Vision 2050 particularly programmes for the development of Agriculture and Food Security, Fisheries and Aquaculture sectors.
Opportunities, Resources Available in Promoting Renewable Energy (COMESA)
Over 40 Energy Experts from COMESA Members States are attending a capacity building workshop on Off- Grid renewable energy conducted by the Regional Infrastructure Finance Facility (RIFF), a World Bank financed project implemented jointly by COMESA and the Trade and Development Bank (TDB).
The RIFF project has a total funding of US$ 425 million split in two: a grant facility of $10 million to COMESA and a credit facility of $415 million to TDB. The TDB component is primarily for provision of loans to viable infrastructure projects with private sector interest while the COMESA component is supporting the creation of a conducive environment for private sector investment in infrastructure.
The project’s component on infrastructure finance facility amounts to US$ 325million and is being administered by TDB. It will provide long-term finance to infrastructure sub-projects that meet the set development impact criteria.
EAC Secretary General hails strong diplomatic and trade relations with European Union (EAC)
The East African Community Secretary General, Hon (Dr) Peter Mathuki, has hailed cordial relations between the European Union (EU) and EAC Partner States coupled with strong trade relations since 1975 under the Lomé Convention and the Cotonou Partnership Agreements. The Secretary General said that the EU for a number of years has been supported the EAC regional integration agenda through the National Indicative Programmes (NIPs), the Regional Indicative Programme (RIP) and implementation of several East Africa Road Network/Transport Corridors, Energy projects, migration programmes and frameworks for democratic governance among other programmes.
”We are grateful for the sectoral specific support in agriculture, improvement of transport and energy infrastructures, improving access to water, education, health, strengthening good governance, institutional capacity building, trade facilitation and the fight against piracy, to mention but a few”
Support SMEs to enhance regional economic integration - EBID Prez. Urges (News Ghana)
The President of the ECOWAS Bank for Investment, Dr George Agyekum Donkor, has called for the implementation of measures to give companies, especially small and medium scale Enterprises (SMEs), a modicum of predictability and certainty when entering international transactions. He said regional economic integration would not be successful unless the legal challenges posed by doing business across countries, which were making it difficult for the sub-region to attract investments, were resolved. “The legal framework rests at the core of business risk calculations, making it a key factor in the success of business initiatives and in the long-term, economic growth, and it is imperative that we develop solutions to the issues that plague it,” Dr Donkor said.
Mining Indaba: Africa’s accelerated energy transition should leave no-one behind (Mining.com)
While it will take the formation of meaningful public-private partnerships to drive change, key industry leaders sketched a push-pull scenario in which the industry leads innovation and must train workers to fill high-tech jobs.
Anglo American Platinum CEO Natascha Viljoen said the company’s recent milestone achievement of unveiling a prototype of the world’s largest hydrogen-powered mine haul truck, designed to operate in everyday mining conditions at its Mogalakwena PGMs mine in South Africa was an apt demonstration of how the private sector was driving positive change. However, she was quick to note that this was but the start of a much larger initiative to decarbonize the company’s global mining operations and create a vertically integrated value chain.
AFRICA: UN plan to accelerate access to clean energy by 2025 (AFRIK 21)
The network brings together 200 governments, businesses and other civil society partners who have pledged to mobilize $600 billion to accelerate access to electricity worldwide. And on that basis, the UN wants to facilitate access to electricity for 500 million people, as well as the distribution of clean cooking kits to one billion people worldwide. “By creating opportunities for collaboration, the Network will turn the billions of dollars of funding and investment committed to the Energy Pacts into on-the-ground action for the sustainable energy future we urgently need,” says Damilola Ogunbiyi, the Special Representative of the Secretary-General for Sustainable Energy for All (SEforALL) and Co-Chair of UN-Energy.
A new initiative is being launched globally to facilitate access to electricity through renewable solutions and clean cooking. It is the new Energy Compact Action Network recently launched by the United Nations (UN). This initiative aims to accelerate access to electricity from renewable sources and clean cooking by 2025. This short deadline reflects the delay in achieving the development goals (SDGs), particularly Goal 7, which calls for universal access to sustainable energy by 2030.
A new initiative is being launched globally to facilitate access to electricity through renewable solutions and clean cooking. It is the new Energy Compact Action Network recently launched by the United Nations (UN). This initiative aims to accelerate access to electricity from renewable sources and clean cooking by 2025. This short deadline reflects the delay in achieving the development goals (SDGs), particularly Goal 7, which calls for universal access to sustainable energy by 2030.
Global economy news
The Impact of the War in Ukraine on Global Trade and Investment (World Bank)
The war in Ukraine is a human tragedy for the people of Ukraine, but its economic implications are global. This instant report focuses on the direct impact of the war on world trade and investment. It identifies five trade and investment channels through which countries will be affected by the war in Ukraine. These encompass disruptions to: (i) commodity markets (especially food and energy), (ii) logistic networks, (iii) supply chains, (iv) foreign direct investment, (v) specific sectors. The report finds that world trade will drop by 1 percent, lowering global GDP by 0.7 percent and GDP of low-income countries by 1 percent. Beyond these direct effects, the war’s long-term implications for global trade and investment will largely depend on how governments respond to the changing geopolitical environment.
“This might well be our Bretton Woods moment. Let’s not waste it” — DDG Ellard (WTO)
In just over a month, the WTO will hold its 12th Ministerial Conference, or MC12. This conference will be like no other because the war has dimmed the global trade outlook: we estimate global merchandise trade volumes to expand by only 3% this year – down from the 4.7% we predicted last October, and this forecast may be downgraded further.
The war has also led to a spike in energy and food prices and is raising fears about food security far beyond Ukraine’s borders. Vulnerable communities in Asia, Africa, and Middle East face famine, riots, and mass migration. Together with other international organizations, we are working to reduce such risks by discouraging export restrictions, keeping supply chains open, and facilitating trade in agricultural products.
Negotiating and seeking consensus in this geopolitical climate is difficult. But it doesn’t mean we can’t do it, and it certainly doesn’t mean we should stop working. Several important issues need Members’ active engagement and flexibility to achieve results now and to set our path after MC12. Let me highlight a few.
First, we can’t forget that the war came hot on the heels of the pandemic, further exacerbating the existing economic crisis. And although in many parts of the world, the health situation has improved, we’re not completely out of the woods. Vaccine inequity remains acute in some countries, and we must think about future pandemic preparedness.
Second, Members have been deeply engaged as to the role of intellectual property rights with respect to COVID vaccines. The proposal our Members are now considering is the result of discussions among key players.
Another multilateral negotiation where we seek an agreement is on fisheries subsidies. Concluding these negotiations after 20 years is an environmental, economic, and humanitarian imperative.
And we must revamp the three functions of the WTO: negotiations, monitoring, and dispute settlement. Doing so will improve the ability of the WTO to meet the needs of our Members. It will send a message that working within rules and institutions is still possible and, in fact, far better than the alternative.
Confronting Fragmentation: How to Modernize the International Payment System (IMF)
As we look to a digital future, the system also needs to withstand the growing forces of fragmentation. These forces have become stronger as a consequence of Russia’s invasion of Ukraine. It has caused not only tremendous human suffering, but also a global economic shock and a sharp increase in the risk of a ‘new Cold War.’ A world that could fragment into ‘economic blocs’, creating obstacles to the cross-border flow of capital, goods, services, ideas, and technologies.
These are the very drivers of integration that have boosted productivity and living standards, tripling the world economy and lifting 1.3 billion people out of extreme poverty over the past three decades. So, the cost of disintegration would be enormous—and the most vulnerable people and countries would be most affected.
Faced with these risks, we can either surrender to trends that will make the world poorer and less stable. Or we can work even harder to seek pathways to prevent the fragmentation of the international monetary system—just as we must work together to confront global threats such as climate change.
We must design and build the infrastructure that facilitates further integration. That includes stepping up our work on cross-border payments.
Members welcome Quad document as basis for text-based negotiations on pandemic IP response (WTO)
At a General Council meeting on 10 May, WTO members agreed that the outcome document emerging from the informal process conducted with the Quad (European Union, India, South Africa and the United States) opens the prospect for text-based negotiations on an intellectual property response to COVID-19. Members welcomed the proposal as a positive development and thanked Director-General Ngozi Okonjo-Iweala and Deputy Director-General Anabel González, as well as the four members of the Quad, for their efforts in trying to find a way forward on this long-standing issue.
The International Chamber of Commerce (ICC) hosted a global competition forum on the side-lines of the 21st International Competition Network (ICN) Annual Conference to help global business and antitrust enforcers gain a deeper understanding of the new trends and related challenges in antitrust law enforcement that have emerged during the Covid-19 pandemic. The ICC Pre-ICN Forum, organised in partnership with the International Bar Association, was conceived over a decade ago to facilitate an open dialogue between key actors in antitrust enforcement – using ICC’s flagship antitrust initiatives to draw attention to critical issues with the view to ignite potential new antitrust reforms. With the introduction of ICC Compendium of Antitrust Damages Actions during last year’s Forum, ICC shone a spotlight on the increasingly fragmented nature of national private antitrust enforcement regimes which continues to create vast new pressures on companies.
The heightened risks faced by companies of being sued for damages brought against them has had an important impact on a company’s decision to report a cartel – making leniency applications less attractive. In this worrying context, ICC was proud to release at the Forum the 3rd Edition of the ICC Leniency Manual providing companies with a step-by-step approach to understanding leniency applications worldwide – and, crucially, the confidence to take action in fighting cartels.
ICC’s latest publication on antitrust compliance developed jointly with Concurrences – Perspectives on Antitrust Compliance – was also launched during the event.
High-level UN conference debates precious commodity: Land (UN News)
Against the backdrop of a UNCCD warning that up to 40 per cent of all ice-free land has already degraded, threatening dire consequences for climate, biodiversity, and livelihoods, world leaders are meeting in Abidjan under the theme of “Land, Life. Legacy: From scarcity to prosperity”. “We are faced with a crucial choice,” Deputy Secretary-General Amina Mohammed told the participants. “We can either reap the benefits of land restoration now or continue on the disastrous path that has led us to the triple planetary crisis of climate, biodiversity and pollution”.
“The Global Land Outlook report just issued by the UN Convention to Combat Desertification shows that our current approach to land management is putting half the world’s economic output – $44 trillion USD - at risk”, said Ms. Mohammed. “We must ensure that funds are available for countries that need them, and that those funds are invested in areas that will have a decisive impact and create a more inclusive, sustainable future for all,” she continued, reminding that land restoration connects all of the Sustainable Development Goals (SDGs).
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SA celebrates new e-certification system for exports (Food for Mzansi)
With more than half a billion e-certificates already issued, South Africa now counts among the first nations in the world with an electronic certification system for the import and export of agricultural products. Agriculture, land reform and rural development minister Thoko Didiza launched the electronic certification system earlier today. “We are delighted to have reached this milestone within a short period of time and we also owe the existence of this system to our industry. We had extensive stakeholder consultations and ensured that there was awareness created and, therefore, a better opportunity to implement the painful process of change management with ease,” Didiza said.
According to Didiza, the e-certification process will not only help South African inspectors to save time during the inspection and certification processes, but be of equal value for inspectors in the Netherlands and other countries. A lot of time will be saved when examining certificates accompanying South African fruit and vegetable consignments, especially through pre-clearance procedures of consignments en route to European Union nations.
Competitive public and private services are key to SA’s economic reforms (BusinessLIVE)
The news that the ANC is seeking greater co-operation from the private sector in revitalising state-owned entities (SOEs) could signal an important shift in policy and mindset. It has become all too apparent that the state lacks the resources and capabilities to go it alone in delivering critical infrastructure and related services. Yet privatisation is no panacea either because of the risks of fragmentation in crucial network industries and of domestic public interests being sidelined in the pursuit of commercial objectives. Responsive partnerships are required that harness the funding and know-how of global operators, while strengthening local linkages, competencies and quality standards in the process. This was an important message emerging from a review of the transport sector in a Human Sciences Research Council (HSRC)-World Bank workshop hosted in March to better understand the performance of firms involved in tradable services in SA.
The event drew attention to the role of both public and private services in supporting the industrial, mining and agricultural base. In fact, services have been the mainstay of domestic job creation over the past decade. SA boasts many service firms with an international reputation, including Naspers, Discovery, MTN, Vodacom, Standard Bank, Absa, Sanlam and Imperial Logistics. Service exports have been even larger than those of motor vehicles. Yet the service sector has been neglected historically by researchers and policymakers, with little recognition of its contribution to trade and growth. The omission has been compounded by a shortage of evidence on the significance of services to national economic development.
Call to ban the export of scrap metal (SAnews)
Minister of Transport, Fikile Mbalula, has called for a ban on the export of scrap metal as the theft and vandalism of critical rail infrastructure sabotage the country’s economy. “We are unequivocal in our call to ban the export of scrap metal and will support any measure that will bring us closer to this reality,” the Minister said on Monday. Addressing a media briefing on the White Paper on the National Rail Policy in Pretoria on Monday, he said taking this step will reinforce government’s interventions aimed at protecting public assets and making the theft of cables and other metals less lucrative.
The Minister said the National Rail Policy is critical for fast tracking the implementation of priority structural reforms in the economy to support economic recovery. “The key policy position on the introduction of third-party access on the rail network is one of the key thrusts to drive efficiencies and improve competitiveness. “The National Rail Policy will guide the building of the local industry capacity thereby boosting the manufacturing capacity and localisation. “Government will ensure that industrialisation and the local production of steel and other inputs, rail lines and supplies, and rolling stock is promoted through policies that will require state and private operators to procure all supplies from South African-based manufacturers,” the Minister said.
The Minister said a localisation strategy will be used to develop the industrial base for an active export strategy, particularly to other African countries. This will also support the Steel Master Plan of government.
Minister Gwede Mantashe: Africa Mining Indaba (South African Government)
As a result of the effects of the Covid-19 induced economic shocks, the current global economic environment remains uncertain. We must build on the experiences learned from the pandemic to reimagine our economic growth path and protect our economies from future shocks. This year’s mining indaba happens with the backdrop of high energy prices, which pose a significant inflationary risk to the poor and emerging markets. Without any doubt, increased energy prices continue to be of great concern for our governments and investors alike. The African continent needs to build resilience against energy supply shocks through the exploration and development of our indigenous energy sources. It is, therefore, not surprising that we convene this Indaba under the theme: “Evolution of African Mining: Investing in the Energy Transition, ESG, and the Economies.”
One of the most promising developments on the continent is the African Continental Free Trade Area (AfCFTA) which has the potential to create the biggest free trade area in the world, cutting red tape and boosting trade throughout the continent. This will significantly improve mining supply chains and reduce input costs.
The Just Transition to a low-carbon future will require “green metals” to which Africa has in abundance of untapped resources such as lithium, copper, cobalt, nickel, and zinc. There is no doubt that the transition will drive demand for these minerals. The Democratic Republic of Congo (DRC) demonstrates this and together with Zambia are among the largest producers of copper and cobalt in the world. The DRC, for example, accounts for about 70% of global cobalt output and half of the world reserves. In addition, global targets to reduce greenhouse gas emissions entail transitioning away from pollution-emitting combustion engines to greener alternatives that utilise electric or hydrogen fuel cell technologies. The catalytic convertors that vehicle manufacturers use to reduce or neutralise harmful pollutants from exhaust emissions require PGM metals. South Africa accounts for the largest percentage of the world’s Platinum Group Metals reserves with Zimbabwe ranked third. This will ensure that both countries play a crucial role in the world’s emerging energy transition. Minerals of the future that Africa has in abundance hold great potential for the continent. These minerals can be used in the development of the hydrogen economy.
Namport increases total cargo handling (Namibia Economist)
Despite the ongoing global shortage of containers, the Namibian Ports Authority (Namport) recorded positive growth during its just-ended 2021/22 financial year, increasing total cargo handling to 6.5 million tonnes, an increase of 380,541 tonnes. According to Namport, the increase in volumes was mainly due to the increase in vessel visits by 289 vessels or 22%. The vessel’s gross tonnage also increased by 3.4 million. Contributing to the increase was TEU (twenty equipment unit) handling which amounted to 168,278, of which, 61,106 TEUs or 36% were exported, 69,467 TEUs or 41% were imported and 37,705 TEUs or 22% were transshipments. TEUs increased by 12,298 or 8%. “This increase was mainly due to increased containerized commodities such as copper, charcoal, frozen fish, marble, frozen poultry, sugar, chemicals, scrap steel, and wooden products,” Namport stated.
cross border volumes increased by 10% from 1,464,000 gross tonnages (2020/2021) to 1,606,984 gross tonnages (2021/2022). South Africa held the majority of the port’s total cross border market share at 48%, followed by Zambia at 23%, DRC (15%), Zimbabwe (6%), Botswana (6%), Angola at 2%) and Malawi at (1%). Major commodities exported from SADC countries through Namibia included copper, manganese ore, and wooden products (Timber) while major commodities imported to Namibia destined to SADC Countries: frozen poultry, vehicle on own wheels, machinery, spare parts, Tires, chemicals (for mining use), electrical goods, electrical equipment and malt.
Kenya’s Agoa exports climb to Sh50 billion (Business Daily)
Export of duty-free goods to the US under the African Growth and Opportunity Act (Agoa) has crossed the Sh50 billion mark after declining last year. Data from the Kenya National Bureau of Statistics (KNBS) indicates that the value grew by 20 percent, marking one of the biggest leaps in seven years. The goods, mainly textile products, increased from Sh42.2 billion in 2020 to Sh50.6 billion in the review period. “All the selected indicators under the EPZ garment and apparel subsector reported growths in 2021,” said the KNBS.
Agoa allows Kenya to export selected goods at preferential terms, exempting them from paying tax. Textile and apparel products, which have dominated exports under Agoa since it was enacted in 2000, remain the main items in Kenya-US trade, defying efforts made at product diversification over the 18 years. Increasing trade volumes and range of products are some of the grounds that Kenya used to successfully push for a 10-year Agoa extension, now open up to 2025. Nairobi’s bid to expand its initiative beyond apparel falls short of its exports target as the volumes of tea, coffee, and edible oil, which Kenya has been shipping to the US remain low.
Used truck dealers risk closure on imports ban (Business Daily)
Dealers in used commercial vehicles have protested the impending ban on second-hand imports of buses and trucks, saying the market dynamics will threaten their viability once the restrictions are enforced. The Kenya Bureau of Standards (Kebs) said in a notice that used buses more than seven metres in length will not be imported into the country effective July 1. Trucks with load capacities of 3.5 tonnes and above will also be banned from the same date. Tractor heads and prime movers not older than three years will continue to be imported until June 2023 after which only new units will be allowed in. Used commercial vehicle dealers say supply gaps in the market and inconsistent policy in the East African Community (EAC) will shift the business to neighbouring countries as local players face closure. They note that countries such as Uganda continue to allow imports of used commercial vehicles which also operate transport businesses in Kenya, adding that most European models of prime movers are not assembled locally.
Global supply woes hit Kenyan consumer with costly imports (Business Daily)
Kenyan households and businesses are feeling the pinch of global supply constraints and weakening shilling that has increased the cost of importing essential goods, further squeezing earnings. Official data shows that landed cost of basic food items like wheat, cooking gas, as well as key materials used in farming and construction, have shot up by as much as 67 percent in the past year. An analysis of commodities shipped into the country last year based on data collated by the Kenya National Bureau of Statistics (KNBS) shows the cost of importing cooking oil rose the highest, followed by fertiliser, iron and steel. The emerging global geopolitical and persistent supply chain concerns have exposed Kenya’s soft underbelly as a net importer of raw materials for manufacturing basic household items. The rising cost of importation has hit households hardest, prompting some of them to postpone or scale down projects.
“The freight costs have also increased by more than 30 percent and we all know what is happening in the fuel market.” The farmers have not been spared. The average landed cost of fertiliser last year averaged Sh51,168.10 per metric tonne, a 56.05 percent jump from Sh32,788.80 in the prior year, according to the KNBS data, sourced from the Kenya Revenue Authority.
The largest jump was, however, recorded in the landed cost of vegetable oils and fats that climbed 67.39 percent per kilogramme to Sh130.40 last year from Sh77.90 in 2020. “We have tried to minimise cost to consumers by being creative and innovative with other parts of the supply chain, but overall we have had no choice but increase the prices by about 10 percent,” Rajul Malde, the commercial director of Pwani Oil, the makers of products such as Fresh Fri cooking oil and Sawa soaps, told Business Daily on April 25.
Kenya resolves fuel dispute with Uganda (Business Daily)
Kenya has moved to avert a diplomatic spat with Uganda over a decision to localise fuel cargo meant for Kampala. Petroleum Principal Secretary Andrew Kamau told Business Daily on Monday that Kenya shared a record of available stocks of diesel and super for Uganda in this month’s allocation quotas, easing fears of a looming fuel shortage in the neighbouring country. Kenya last month ordered oil marketers to localise 133.5 million litres of super and 104.7 million litres of diesel that were meant for the transit market prompting protests by the Ugandan Parliament over looming outages. Uganda relies on Kenya for transportation of 75 percent of its fuel requirements highlighting the adverse effects in the likelihood of disruptions from Nairobi.
Manufacturers propose higher taxes on imports (The East African)
Importers of beauty products, textiles and motor vehicles face higher taxes should the East African Community settle on a unified policy on the fourth band of the Common External Tariff (CET). The maximum CET rate has been 25 percent but has risen to 35 percent after conclusion of negotiations to adopt the fourth band are ongoing. The CET is considered an important instrument of EAC Customs Union Protocol as it determines the tax paid on imports from outside the region. Under the current CET, raw materials attract zero percent tax, intermediate goods 10 percent and finished products attract 25 percent levy. “Among the EAC partner states, it is only Uganda that has proposed a 35 percent tariff. Kenya and Tanzania propose the maximum rate to be 33 percent, while Rwanda and Burundi propose 30 percent,” said Phyllis Wakiaga, chief executive of the Kenya Association of Manufacturers. “We as manufacturers have already agreed on a proposal by the Kenyan private sector of 35 percent as the fourth CET tariff band,” she added. Most of the products considered for a maximum CET rate (the fourth band) are under the EAC priority value chains as provided for in the EAC Industrialisation Policy (2012-2032). They include textiles, iron, steel and motor vehicles.
Manufacturers want higher tariffs to bar importation of items that could otherwise be made locally. “Some of the products have a long value chain and face unfair competition from cheap imports from Asian countries hence need higher rates to safeguard their production.”
“It will mean that we now have to change our strategy and re-invent and use local substitutes, which are likely to be even more expensive. This is likely to drive the local beauty industry out of business and benefit countries such as Nigeria, which are more established in the business,” said Jayne Okoth of the Rapenzel Hair Care.
DRC exported goods worth 5.7 Billion to the East African Community in 2020 (HapaKenya)
The East African Business Council Board has indicated that In 2020, EAC countries imported goods worth USD.49.2million from the DRC while they exported USD. 584 million to DRC. Top EAC exports to DRC include: lime and cement, iron and steel, Tobacco, Beverages, spirits and vinegar, animal or vegetable fats and oils, wheat gluten, Sugars & confectionery, Plastics, and Soap among other products. Women cross-border traders in DRC have appealed for trainings on how to export to the EAC to be rolled out. The Goma One-Stop Border Post links Rwanda and DRC. In 2019 Rwanda’s exports of goods to DRC stood at USD 372.5 million while Rwanda’s imports from DRC stood at USD. 16.7 million.
BUA Foods welcomes MV Bundu. Aquires first of two shipping vessels for sugar export operations (Nairametrics)
BUA Foods, one of Africa’s leading FMCG companies has taken delivery of the first of two shipping vessels to augment its sugar export operations to the West African market, which kicked off successfully earlier this year. BUA Food’s export of refined sugar will benefit the economy, providing alternative source of income, while significantly diversifying the company’s markets. The vessels will depart and berth at BUA’s port and terminal increasing export capacity while reducing operating cost. The Mitsubishi of Japan built vessel is named MV Bundu – after the area in which the refinery is located. The vessels cargo capacity is suited to enhance quick and sustainable delivery of more refined sugar in the face of growing export demand from across the African region.
“As we drive our business for growth with focus on sustainable returns, and benefit to all our stakeholders and the Nigerian economy, owning a shipping vessel is an important step in BUA Foods strategy” said the Chairman BUA Foods Plc, Abdul Samad Rabiu. “We see an increased and continued demand for refined sugar across the region with attendant increase for logistics support to aid timely delivery, which is why it is important for us to strengthen our current capability with an own-controlled asset as we advance further in our business strategy. These new vessels will create operational efficiencies in our business and open possibilities for new services.”
Trade ties: Zambia and DRC sign cooperation Agreement to manufacture electric batteries (Africa Renewal)
The Cooperation Agreement is expected to provide a framework for bilateral cooperation on the initiative to develop the battery value chain as well as strengthen collaboration between Zambia and DRC. Once actualised, the combined strategy will create jobs for Congolese and Zambians and boost economies of the two countries. President Hakainde Hichilema said the signing of cooperation agreements between Zambia and the DRC to start manufacturing electric car batteries is key milestone towards poverty alleviation in Zambia and DRC.
“Today’s agreements prove that my attendance of the DRC Business Forum held in November 2021 was a right decision as it gave birth to today’s historical event. However, signing is one thing and there is need to actualize the agreement. Africa has for long been viewed as a source of raw materials, but the narrative is now being changed” the President emphasised.
President Tshisekedi notes that African countries should put their resources together to unlock their economic potential. He said the agreement will strengthen the value chain for production of batteries for electric cars which will be key to economies of Zambia and the DRC. Mr. Tshisekedi said Africa’s economic power will be advanced with such initiatives which will create jobs for many youths.
Speaking earlier, Commerce, Trade and Industry Minister, Mr Chipoka Mulenga the signing ceremony signified a key milestone for both countries as the initiative provides a great to harness mineral resource wealth and foster the development of mineral-based industrialisation and value chains.
Central African Republic: Supporting Digital Governance and Competitiveness (World Bank)
The government of the Central African Republic has made significant efforts in recent years to improve public financial management, including through digitalization of services. Reforms aimed at digitalizing the tax administration have also been introduced. To support the additional work needed to scale up these reforms, the World Bank approved a $35 million grant for the Public Sector Digital Governance Project and $30 million for the Investment and Business Competitiveness for Employment Project. “Improving public financial management, transparency, and efficiency is central to the World Bank’s partnership with the Central African government, as is creating job opportunities for youth through a better private sector development,” said Han Fraeters, World Bank Country Manager for the Central African Republic. “Despite the difficult circumstances facing the country, it is important to remain engaged on an agenda that brings sustainable development impact to the people of the Central African Republic.”
Djibouti Border Set to Rise (COMESA)
Small scale cross border trade is set to thrive along the Djibouti- Ethiopia borders following the first joint border trade committee meeting on 27 – 30 April 2022. The meeting was driven by the need to identify and resolve challenges facing the implementation of the Djibouti – Ethiopia Border Trade Protocol signed in 2015. The meeting, which was conducted at Semera in Ethiopia brought together officials from different ministries and agencies, representatives of regional trade bureaus, customs control offices from Ethiopia and Djibouti and COMESA Secretariat. Key on the agenda was how to bring the Protocol, into compliance with the COMESA Simplified Trade Regime (STR). The STR is a trade facilitation instrument for small scale cross border traders dealing in small quantities of goods. It enables their goods to benefit from the removal of customs duty if those goods are on the Common Lists Also on the agenda were bilateral negotiations on the Common List of Goods that qualify for preferential treatment under the STR. The delegations agreed to amend the list of tradable goods to make the list compatible with COMESA STR and to include the Harmonized System (HS) code.
African trade news
Africa Competition Report 2022 (Baker McKenzie)
Competition authorities play an important role as champions, advocates and enforcers of competition policy across economies and view competition policy as a key driver of economic growth. The Report outlines how 29 of the 32 surveyed African jurisdictions and regional bodies have national competition laws in place. Although over the past two years African competition regulators have actively engaged in efforts to address pandemic-related challenges, there has also been a general upward trend in competition policy enforcement across the continent. African jurisdictions have strengthened their competition and antitrust regimes by way of amendments to existing legislation, the introduction of new laws and regulations, and renewed fervor and political will to enforce existing laws.
2022 Africa CEO Trade Survey – What does the AfCFTA mean for African business? (Afreximbank)
he Pan-African Private Sector Trade and Investment Committee (PAFTRAC) has announced today the launch of the 2nd edition of its Africa CEO Trade Survey. The focus this year will be on the opportunities being created by the African Continental Free Trade Area (AfCFTA) Agreement. The AfCFTA agreement creates the largest free trade area in the world, by the number of countries participating, and under which trading commenced in January 2021. The participation of the private sector is crucial to the success of the AfCFTA. The Africa CEO Trade Survey is an initiative by PAFTRAC that provides the continent’s private sector a platform to engage on localized and pan-African trade policies. The survey results are presented in a report format that seeks to advocate private sector views to inform policy reform and shape the future of African trade.
“The opportunity that the AfCFTA brings to businesses across the continent is enormous, that is why we must get the implementation right. The private sector wants and needs to be an ally in this process.” said Prof Patrick Utomi, Chairperson of PAFTRAC, commenting on the launch of the Africa CEO Trade Survey. “We call on business leaders from across the continent to make your voices heard by participating in this survey” he added.
Africa launches a platform to deal with the Ukraine crisis shocks (UNECA)
Two years after the emergence of COVID-19, Africa has absorbed a number of lessons which will prove crucial as the continent confronts the new food, fuel and fertilizer crisis reverberating across the world as the Russia-Ukraine war creates historic, global trade and commodity disruptions. Ongoing studies will in time, no doubt, offer compelling explanations as to why the overall incidence of COVID-19 on the continent has remained low. But already, two things are clear: Africa reacted collectively, and it reacted early – and this has paid off.
Faced with a new crisis, Africa must build on the experience of the past to pull together once again. The COVID-19 experience showed that organised pooling of demand can overcome supply chain challenges and deliver much needed goods at competitive prices. New markets within Africa were created, as pooled demand was matched with existing and repurposed capacities in the continent. Crucially, these achievements are replicable – and the same can be done to address the food, fertiliser and energy commodities crisis being experienced today.
Building on the African Development Bank’s $1.5 billion emergency food production plan to mitigate the effect of the war on food prices through rapid production of wheat, maize, rice and soybean, AFREXIMBANK has undertaken a collaboration with other key continental institutions including, the AfCFTA Secretariat, and UNECA to launch the Africa Trade Exchange (ATEX), a platform to pool-procure bulk basic commodities and ensure countries access scarce supplies in a transparent and equitable manner. ATEX is a digital trade platform which will complement the existing digital ecosystem constructed to support the implementation of the African Continental Free Trade Area (AfCFTA) Agreement. ATEX will help realize the development potential of e-commerce and digitalisation, particularly by facilitating access for small and medium-sized enterprises (SMEs) to the wider African market. This will enhance intra-African trade and the African trade position in the global market, thus assisting in adjusting to disruptions in supply chains and continued growth of African businesses and economies.
Report: Twitter, cryptocurrency ban crippled FDI in fintech sector (TheCable)
The restrictions on cryptocurrency transactions and the outright ban of Twitter in Nigeria have crippled foreign direct investment in the financial technology sector, according to a new report. The report titled ‘Africa’s Urbanisation Dynamics 2022: The Economic Power of Africa’s Cities’ was published under the responsibility of the secretary-general of the organisation for economic cooperation and development and the secretary-general of the United Nations, with support from the African Development Bank (AfDB). The report said the ban affected millions of young Nigerians who earn a living from the sector as well as tax revenue for the government. It added that the jobs in the technology sector give more room for young people to tap into the global economy.
“The restrictions on cryptocurrency transactions and the outright ban of Twitter in Nigeria have crippled foreign direct investment in the fin‑tech industry and negatively impacted millions of young Nigerians who earn a living from the sector. Many have found a way, however, to lawfully bypass these restrictions and continue the business, effectively denying Nigeria the taxes and transaction fees that would otherwise come into the system.”
Why African Governments Must Collaborate More For Continent’s Development – President Buhari (Tribune Online)
If there has ever been a time when strong parliamentary leadership is most needed, it is now. This is so, especially because the COVID-19 pandemic has had a widespread effect on economies across the world, destabilizing health systems, upending supply chains, disrupting industries and above all, precious lives have been lost.
Various African countries took decisive measures to contain the spread of the virus and limit its socioeconomic impact. Public health interventions were rolled out, and several programmes and measures were put in place to combat the pandemic, such as lockdowns, stimulus packages, financial support to households and MSMEs, and so on. We all achieved some level of progress with those measures.
I think it is clear that the post-COVID economic recovery strategy for Africa must go beyond efforts in our individual countries. There is a need for increased collaboration and integration of efforts to drive sustainable economic growth and recovery across the African Continent.
A crucial concern for all African economies is how to improve liquidity, reduce the debt burden and improve our balance of payments positions, especially in the wake of the huge damage done to our finances by the pandemic.
The COVID-19 experience reiterates the need to leverage technology in building stronger delivery systems for wider coverage towards protection for all. Our legislation across the continent must be designed to support technology and technology innovation.
Africa’s post-COVID recovery must leverage the African Continental Free Trade Area (AfCFTA). The AfCFTA is a unique opportunity to consolidate Africa’s enormously large market, which will create and recover millions of jobs, reduce Africa’s import dependency, boost intra-Africa trade and exports; and strengthen intra-Africa cross-border ties and trade relations. The opportunities are simply mind-boggling, but they will involve the magic word – collaboration!
Afrexim Bank, as the main settlement agent for PAPSS, provides settlement guarantees on the payment system and overdraft facilities to all settlement agents, in partnership with Africa’s participating Central Banks. PAPSS will effectively eliminate Africa’s financial borders, formalise and integrate Africa’s payment systems, and simply make trade within Africa using local currencies easier.
This is the way to go. Domestic legislation will be required as time goes on, and we must anticipate and be prepared to act on these promptly.
African aviation stakeholders meet in Nairobi to discuss the future of the industry after COVID-19 (HapaKenya)
The 10th Aviation Stakeholders Convention, hosted by the African Airlines Association (AFRAA) and Kenya Airways (KQ), started today in Nairobi at the Emara Ole-Sereni hotel. The two day convention will provide a platform to showcase new developments and innovations in aviation, discussing industry business trends, networking and forging new partnerships.
Speaking at the convention on the importance of establishing lasting relationships and partnerships between aviation stakeholders for the benefit of African Aviation, Mr. Abdérahmane Berthé emphasized the need to draw out-of-the box solutions and regional initiatives for Africa: “AFRAA, in coordination with African Union Commission (AUC), African Civil Avation Commision (AFCAC), and African Aviation Industry Group (AAIG), will convene the first lab meeting to be held from 27 June to 01 July 2022. I call upon stakeholders to join this noble initiative which will bring experts from various sectors to craft solutions to transform business in the region and ensure the efficient development of intra-Africa air transport.”
African digital platform called to store work of creative sector (Devdiscourse)
Minister of Sport, Arts and Culture, Nathi Mthethwa, has called for a worldwide, Africa-based digital platform to store the work of the creative sector on the continent. “There is a dire need to have a worldwide, Africa based digital platform that houses all online creative arts, copyright and patents, and sporting platforms for control and sustainability of the collective intellectual property of the African Union (AU) member States’ intangible heritage,” the Minister said on Monday. He was addressing the launch of Africa Month under the theme, ‘Strengthening Resilience in Nutrition and Food Security on the African Continent for a Better Africa and a Better World’.
He emphasised the importance to develop modern agriculture for increased proactivity and production by radically transforming African agriculture to enable the continent to feed itself and be a major player as a net food exporter.
China lockdowns, Ukraine invasion delay imports to regional ports (The East African)
East African countries are set to suffer more importation delays following new Covid-19 cases in China and the Russian invasion of Ukraine increased congestion in the supply chains. Already, authorities in Beijing have imposed lockdowns in regions reporting infections, restricting workers to port yards. At the same time, the region, which imports more than half of its wheat from Ukraine, must now accept delays as the war disrupts routine transportation. Shippers have already raised concern over expected delays in the supply of key goods, saying the number of ships docking at the ports of Mombasa and Dar es Salaam is expected to reduce in the next few weeks.
“Reports indicate that nearly one third of goods leaving the port of Shanghai are held up due to a strict Covid-19 lockdown that is threatening freight. As a result, the end of April witnessed more than 23,000 ships rerouted to avoid the Chinese port thus causing shipping delays,” said Mr Kututa.
Mr Kututa said congestion will affect Africa considering the business in the continent contribute a small percentage of global shipments.
Trade in Services Negotiations Resume as Experts Meet (COMESA)
Trade experts from COMESA Member States are meeting this week to continue with the negotiations on the draft schedules of specific commitments under Trade in Services sector. This is the 11th Committee Meeting on Trade in Services, the apex forum of the Member States in the subsector. Since 2009, following the adoption of the COMESA Regulations on Trade in Services, negotiations have been taking place in the priority sectors: business, communication, financial transport, construction, energy-related and tourism services. The sector accounts for more than 70 per cent of the global output and 51.1 per cent of labour force. The conclusion of the negotiations on the priority sectors, which is in the second phase, will guarantee preferential market access in both negotiated services sectors and goods. According to the COMESA Director of Trade and Customs Dr Christopher Onyango, this will unlock the opportunities for regional businesses and suppliers to expand and strengthen existing value chains.
“The conclusion of the second phase of the negotiations would reflect the strong commitment of COMESA towards the creation of a transparent, stable, and predictable environment for trade in services not only in the region but beyond including global markets,” he said when he addressed the delegates at the opening of the virtual meeting, Monday 9 May 2022.
“A liberalized goods trading regime cannot offer its business community the freedom to expand and exploit existing potentials without complementary services sectors free of unnecessary restrictions and controls,” he said.
EAC business leaders in DR Congo to explore investment opportunities (The New Times)
Regional business executives on Monday, May 9, started their earlier planned business trip to DR Congo to engage their Congolese counterparts with a view to exploit business and investment opportunities in the vast country. Speaking to The New Times from Goma, the capital of DR Congo’s North Kivu Province, John Bosco Kalisa, CEO of the East African Business Council (EABC), said his delegation started with Goma and will move to Bukavu on Wednesday.
Kalisa earlier told The New Times that his delegation wants to bring their Congolese counterparts to speed about the opportunities provided by both the EAC Common Market and Custom Union frameworks.
DR Congo President Félix Tshisekedi, on April 8, signed the Treaty of accession by his country to the East African Community (EAC).
DR Congo is expected to bolster the bloc’s economic potential in various ways including opening the corridor from the Indian Ocean to the Atlantic Ocean, as well as North to South, hence expanding the economic potential of the region.
China’s economic expansion benefits Africa, including SA (BusinessLIVE)
A few days ago, China’s National Bureau of Statistics released data on the performance of the Chinese economy in the first quarter of 2022. The new information dispels the international community’s doubts about the Chinese economy and provides much-needed heat for the world economy in a winter of recovery. The Chinese economy is performing smoothly. The GDP for the first quarter was more than 27-trillion RMB, up 4.8% year on year and ranking the highest among the world’s major economies. The value-added of industries above a designated scale grew by 6.5%, a growth rate that is 2.6 percentage points higher than the previous quarter. The consumer price index (CPI) rose by 1.1%, which is below the target of 3%. The national surveyed urban unemployment rate averaged 5.5%, which is on a par with the same period in 2021. Foreign exchange reserves remained stable at about $3.2-trillion. Imports and exports of goods grew 7.5% and 13.4% respectively, and paid-in foreign investment increased by 25.6%.
China’s economic development will continue to benefit African countries, including SA. China is now the world’s second-largest economy, number one trader in goods, number one manufacturing powerhouse, holder of the largest foreign exchange reserves, the second-largest consumer market and the recipient of the second-largest foreign direct investment (FDI) inflows. An International Financial Forum (IFF) report forecasts that China will remain the largest contributor to global economic growth, accounting for 26.3% of world growth in 2021.
China has remained Africa’s top trading partner for 12 consecutive years. China is also a major source of FDI for Africa. In the first quarter data from the General Administration of Customs of China showed that China-Africa trade reached $64.86bn, up 23%. Among this volume China’s exports to Africa totalled $35.16bn, up 18.2%, and China’s imports from Africa reached $29.69bn, up 29.3%. Trade between China and SA reached $12.29bn, up 13.5%. China’s exports to SA topped $5.28bn, up 23.7%, while China’s imports from SA reached $7.01bn, up 6.9%.
AGOA Exporter of the Year Awards 2022 open for nominations (Engineering News)
Nominations are now being accepted for the 2022 South Africa AGOA Exporter of the Year Awards. It is hosted by the International Trade Institute of Southern Africa with the support of the USAID Southern African Trade and Investment Hub.
The awards aim to recognise and reward outstanding performance and noteworthy efforts of exporters in overcoming market entry hurdles and achieving successful and consistent trade with the US under the US African Growth and Opportunity Act (AGOA).
Award categories include small-sized exporters to the US under AGOA; medium-sized exporters to the US under AGOA; large-sized exporters to the US under AGOA; black-owned enterprise exporters to the US under AGOA; youth-owned exporters to the US under AGOA; and female-owned exporters to the US under AGOA.
CAR’s adoption of Bitcoin not taken firmly by Central banks in Africa (The Coin Republic)
Bitcoin adopted by the Central African Republic has not been taken well by banks. The legislative leader of the Bank of Central African States has given a searing letter to the Central African Republic (CAR). It is in regards to the country’s reception of cryptographic forms of money like Bitcoin.
In a letter addressed to the CAR Finance Minister Hervé Ndoba, legislative leader of the BEAC Abbas Mahamat Tolli depicts the significant adverse consequence that the CAR embracing crypto will have on the financial association of Central Africa.
CAR passed a bill declaring its expectation to embrace cryptographic forms of money in April. It is nothing unexpected that the International Monetary Fund (IMF) has proactively called the choice concerning. Yet, presently, the BEAC is stoking the fire.
Global economy news
DG Okonjo-Iweala urges WTO members to “meet the many challenges of our time” (WTO)
“What the world needs right now is a responsive WTO, one that helps us meet the many challenges of our time and delivers on the aspirations of the people we serve,” DG Okonjo-Iweala said in her role as Chair of the Trade Negotiations Committee (TNC).
The DG told members that she sensed a willingness to try to work towards some deliverables at MC12, among them the importance of addressing the food crisis, the need to reach a credible WTO response to the COVID-19 pandemic, successfully concluding the negotiations on fisheries subsidies, making some progress on agriculture, and addressing reform of the WTO.
Implications of COVID-19 for Biodiversity-based Products and Services, including BioTrade (UNCTAD, pdf)
This report examines the implications of the COVID-19 pandemic for stakeholders involved directly or indirectly in the production and trade of biodiversity-based products and services, including those sustainably sourced and traded as BioTrade products and services.
This study starts with an analysis of the opportunities provided by the pandemic to certain organizations by investigating the nature of positive impacts, in particular in terms of shifts in demand, access to markets and increased sustainability efforts. It then looks at the challenges respondents’ organizations faced since the advent of the pandemic, in terms of different types of impacts, their duration and the extent of their severity, as well as how it affected their revenues. Finally, the report focuses on the different types of solutions implemented by respondents’ organizations to navigate the exceptional circumstances brought by the pandemic. Solutions specifically relate to measures implemented in response to the pandemic, to the shift towards the digital space in the face of reductions in personal mobility and in-loco operations.
Cracking the code on a thriving partnership (Trade for Development News)
The past two years have been a rollercoaster as COVID-19 and climate change challenged global, national and local systems and traditions. The war in Ukraine, an event no longer expected in post-world war Europe, and its dire impacts in countries far away from the warring parties, is adding stress, complexity and growing uncertainty to the already challenging international landscape. In this context, the importance of partnerships cannot be underestimated as no one, or group alone can tackle the immensity of the challenge.
Even the trade community is feeling the partnership push. Historically, trade was considered as a separate world operating independently from development. The idea of development in multilateral trade was often reduced to the principle of special and differential treatment, which exempts developing countries from certain obligations imposed by the trade regime. But recently, trade and trade policy have been forced to reconsider their interconnection with development, environmental and social issues.
In practical terms, trade must now be addressed in the wider context of economic development and related financial and regulatory frameworks but also take into consideration the interaction of trade with social, environmental, and political issues, including health disasters, climate change and conflict.
Digital technologies can support industries in achieving sustainability, net-zero goals (Engineering News)
Digital technologies can support industries in achieving their sustainability and net-zero emissions goals. Efficiency is the largest driver of sustainability, but also of profitability, says industrial software multinational Aveva global head of digital acceleration Michele Cacciari. “Digital technologies can become an important enabler of a sustainability journey by first unlocking the efficiency of existing facilities and then, over the short- to medium-term, processes can be modified and changed to enable new feedstocks to be used. Eventually, old equipment that consumes less energy can be replaced and, over the longer term, technologies can help a company move to using new energy sources, such as hydrogen,” he adds.
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South Africa to Host Investment Forum at African Mining Indaba (the dtic)
Team South Africa will host a mining investment forum at the Investing in African Mining Indaba at the Roof Terrace of the Cape Town International Convention Centre tomorrow, Tuesday, 10 May 2022 from 14:00-16:00. The theme of the session will be Accelerating Economic Growth by Building Partnerships in Mining and Mineral Beneficiation. The Mining Indaba gets under way this morning and will take place until Thursday, 12 May 2022 under the theme Evolution of African Mining: Investing in the Energy Transition, ESG, and the Economies.
“The purpose of hosting the investment forum is to provide potential investors from the targeted countries with the opportunity to interface with the South African ministers as well as obtain clarity on the issues relating to the South African mining environment. The session will be an exclusive event for about 150 delegates, who will include investors, senior mining executives, senior government officials and key media figures where government will present its offerings to the investment community. Discussions at the session will centre on current and critical issues affecting the mining industry,” says Head of Invest South Africa at the Department of Trade, Industry and Competition (the dtic), Mr Yunus Hoosen.
He adds that the session and South Africa’s participation in the Africa Mining Indaba will contribute in positioning the country as an investment destination of choice with a large presence of mining sector multinational investors with thriving businesses, thereby promoting the country’s investment proposition
Port of Saldanha Bay Could Boost South Africa’s Container Capacity (The Maritime Executive)
Plans are underway in South Africa to develop an international business zone at the deep draft Port of Saldanha Bay, located 65 miles to the north of Cape Town, to provide for the transportation needs of the oil and gas industry. There may also be opportunity to develop container operations at Saldanha Bay.
Kenya rich with opportunities for local exporters (Sunday Mail)
The ongoing engagement and re-engagement drive being spearheaded by President Mnangagwa is bearing fruit. An increasing number of countries are warming up to bilateral trade and economic relations with Zimbabwe. Of late, the Second Republic has intensified engagements with fellow African countries as it looks to unlock opportunities availed by the African Continental Free Trade Area (AfCFTA). In March, President Mnangagwa was in Kenya on a State visit, during which he held high-level talks with his counterpart, President Uhuru Kenyatta. The two Presidents discussed the need to expand cooperation between Harare and Nairobi in critical areas such as trade, investment and tourism. In addition, the Zimbabwe-Kenya Joint Permanent Commission for Cooperation (JPCC) has over the past few years been engaging in areas that will bolster ties between the two countries. What is perhaps important going forward is for local companies to explore opportunities available in Kenya, as well as create strong synergies with like-minded businesses in the East African country.
Kenya’s economy booms as Tanzania softens borders (The East African)
Tanzania’s “softened” borders with Kenya, reduced non-tariff barriers and solutions to bilateral issues have resulted in the growth of businesses in both countries, a year after President Samia Suluhu took office. The survey shows that the pandemic notwithstanding, Kenya imported more goods during the past year than before from Tanzania.
Poor roads, port inefficiencies blamed for high transport costs (Business Daily)
The cost of moving goods in Africa is 3.5 times more expensive compared to high-volume global trade routes because its ports have little economy of scale, according to logistics experts. Increasing operational costs due to underdeveloped rails, road networks and regulatory bottlenecks have also been cited as major contributors to slow traffic through Africa’s ports. Speaking during the 26th Intermodal Africa Exhibition and Conference in Mombasa, participants said capacity constraints at the ports have limited accommodation of large ships in line with international shipping trends.
The CS said the cost of logistics in Africa is pushed up by the states of infrastructure. “We cannot deny the fact that the cost of doing business in Africa is directly determined by the state of infrastructure. Undoubtedly, transport systems interconnectivity in the continent is still poor and the state of affairs cannot be improved if governments do not integrate their investment plans,” Mr Yatani said.
Uganda parliament delays decision on coffee exports deal (The East African)
The future of Uganda’s coffee sector and the 15 million people engaged in the crop’s value-chain remains unclear after the Deputy Speaker of Parliament declined the tabling and debate of a key report on the sector. The document prepared by the House committee touched on the contentious agreement between the government and Italian investor Uganda Vinci Coffee Company Ltd.
The report, which was signed by all 27 committee members, will be debated followed by a vote to decide whether to terminate the coffee deal or uphold it. On February 10, Uganda government through Finance Minister Matia Kasaija and Permanent Secretary Ramathan Ggoobi, signed a deal with Vinci Coffee Company, represented by Enrica Pinetti.
Uganda bans crypto trade – TechCrunch (TechCrunch)
Uganda’s financial regulator has warned payment service providers from enabling cryptocurrency transactions in the East African country. The Bank of Uganda, in a letter, said it had not licensed any payment provider or operator, including banks or fintechs, to sell or facilitate trade using crypto — while also making reference to the government’s stand that crypto is still not legal tender. Payment providers found selling or facilitating trade will have their licenses revoked, the bank said. “Bank of Uganda has noted press reports and adverts advising the public that they can convert crypto currencies into mobile money and vice versa. We are also aware that such conversion cannot happen without the participation of the Payment Service Providers and or Payment System operators,” the bank’s acting director Andrew Kawere, said in a statement, according to this report.
“This is to advise that Bank of Uganda has not licensed any institution to sell crypto-currencies or to facilitate the trade in crypto-currencies. This is in line with the official Government position…this is to warn all licensed entities under the National Payment Systems…to desist from facilitating crypto currency transactions.”
New Handling Record At Port Of Maputo Points To A Positive Market Recovery (Africa.com)
In 2021, the Port of Maputo achieved a new handling record of 22.2 million tons, representing 21% year-on-year growth compared to the previous year’s handling volume of 18.3 million tons.
A reflection of a post-Covid market recovery, Mozambique’s Maputo Port Development Company (MPDC) CEO Osório Lucas says this growth can also be attributed to a more efficient usage of several of the port’s rehabilitated berths, as well as an expanded ferro slab footprint and dedicated rail siding.
“Investment in automation solutions within the port were carried out throughout last year, as part of a strategic expansion plan prepared by the MPDC to address the bottlenecks within the Maputo Corridor and therefore improve the efficiency of cross-border cargo flow in Sub-Saharan Africa,” says Lucas.
AfDB secures $15.6bn investment for Lagos-Abidjan highway construction (Businessday)
Akinwumi Adesina, the president, of the African Development Bank (AfDB), says the bank has secured a 15.6 billion dollars investment for the construction of the Lagos-Abidjan highway. He said that the investment would strengthen regional trade and integration in West Africa by linking the hinterlands of different Participating Member Countries (PMCs). The president said that the investment would include providing seaport access to landlocked countries and some transition states of West Africa to the vibrant seaports. NAN reports that the Lagos-Abidjan highway interconnects the capital cities of five Western African States, covering approximately 1,028 km and eight border crossings. They are Cote d’Ivoire, Ghana, Togo, Benin and Nigeria.
Promoting Non-oil Exports for Fiscal Sustainability, Growth (This Day)
Amidst the present administration’s current efforts aimed at diversifying the base of the Nigerian economy from the perils of oil, the need to provide adequate funding and attention to the non-oil export sector cannot be over-emphasised. Analysts have contended that most of the economic challenges bedeviling the country could simply be addressed by boosting local production and strengthening its non-oil export potential.
a vibrant non-export sector has the potential to solve much of the country’s unemployment challenges by providing millions of direct and indirect job opportunities. Strengthening the appropriate non-oil export facilitation institutions to live up to their mandate of providing short-medium- and long-term financing to the private sector will not only boost the government’s revenue receipts thereby enhancing its fiscal profile amidst the current revenue challenges but also benefit the economy in several ways.
Stranded vehicles litter ports over controversial CET levy (The Guardian Nigeria)
Thousands of vehicles are currently littering the Lagos ports as a result of the brouhaha between the Customs brokers and the Nigeria Customs Service (NCS), over the controversial 15 per cent Common External Tariff (CET) Levy, lingers. The abandoned vehicles are now accumulating demurrage and rents, which creates serious bottleneck to revenue collection and impediment to trade. With the Customs changing the controversial 15 per cent National Automotive Council (NAC) levy on motor vehicles imported into the country to 15 per cent Common External Tariff (CET) levy, the clearing agents have abandoned vehicle clearing, describing the levy as illegal.
The clearing agents, who have threatened to shutdown activities at the Lagos ports any moment from now, decried the ‘desperation’ of the NCS on the imposed levy.
GPHA ready for Africa’s trade integration through AfCFTA (GhanaWeb)
The Ghana Ports and Harbours Authority (GPHA) has assured the Ghanaian trading community that the country’s seaports are ready for Africa’s trade integration agenda through the African Continental Free Trade Area (AfCFTA). She said, “Therefore, GPHA sees AFCFTA as a great opportunity to continue to invest in the infrastructure required to propel the economy for the future.” Mrs. Essel stated this at the 12th monthly stakeholder engagement seminar organized by the Ghana News Agency Tema Regional Office which is a platform rolled out for state and non-state actors to address national issues.
African trade news
The African Continental Free Trade Agreement Can Succeed With Bitcoin (Bitcoin Magazine)
The African Continental Free Trade Agreement (AfCFTA) is the dawn of a fresh start for the continent, and if implemented successfully, it will unleash a new era of prosperity on the back of increased intra-African trade.
As the continent grapples with the negative economic effects of the pandemic, it became very clear that developing decentralized regional value chains is necessary
Cross-border payments within Africa are very slow and costly. This is partly due to the fact that 80% of African cross-border transactions originating from African banks are routed offshore for clearing and settlement through correspondent banking relationships. With over 42 different currencies on the continent, currency conversion costs amount to $5 billion annually. Additionally, the majority of these currencies don’t have any value outside of their home country and, coupled with disparate regional exchange rate regimes and payment systems, transacting with African currencies becomes impractical. Without a uniform or robust payments network, the AfCFTA is unlikely to succeed, and this is where Bitcoin is a viable solution.
Securing single payment platform for Africa: No financial institution will be left behind - BoG affirms (Graphic Online)
With the continent grappling with the introduction of a single currency for almost 30 years, the Afrexim Bank with support from the Africa Continental Free Trade Area (AfCFTA) Secretariat recently introduced PAPSS which is expected to guarantee instant payment of goods and services between African jurisdictions in any local currency.
Speaking at a summit organised by the Bank of Ghana and its partners, the Head of Payment Systems at BoG, Dr Settor Amediku, said the central bank would ensure that all financial institutions were onboarded to PAPSS, noting that no institution would be left behind.
He said the financial institutions would be able to do this through the GhIPPS platform after it was successfully linked to PAPSS. “PAPSS will work with all regulated payment institutions in every African country. For example, in the case of Ghana, all our banks are going to be linked to the PAPSS infrastructure through GhIPSS. “We have licensed fintechs, we have savings and loans companies, and we have
ECA concludes review of forthcoming 2022 Edition of the Economic Report (UNECA)
Experts from across academia and policy sectors have concluded the external peer review of the 2022 edition of the Economic Report on Africa (ERA 2022), a flagship of the Economic Commission for Africa (ECA). The report on the theme: ”Leveraging digital technology and innovation to promote regional value chains in building forward better in Africa” will be formally launched later in the year after being presented at the 54th session of the ECA Conference of Ministers (CoM2022) scheduled for 11 -17 of May 2022 in Dakar, Senegal.
East Africa’s industrial sector to gain from revised import tariff (The Citizen)
The industrial sector in the East African Community (EAC) is set to benefit from a new tariff for imported goods. This follows adoption of a 35 percent common external tariff (CET) by the partner states for goods that are imported into the bloc. This will be the fourth band of the tariff for the imported goods and whose implementation will start on July 1, this year. The current maximum CET for goods that are imported into the Community is 25 percent. The agreement to the effect was made during a comprehensive review of the CET held in Mombasa, Kenya on Thursday.
“The new tariff will also safeguard consumer welfare on products where the region is net importing,” said Ms Maina who is the Kenya Cabinet Secretary for Trade, Industrialisation and Enterprise Development. EAC Secretary General Peter Mathuki echoed saying the new tariff would encourage the local manufacturing and safeguarding locally made goods.
Among the tariff lines in this fourth band include; dairy and meat products, cereals, cotton and textiles, iron and steel, edible oils, and beverages and spirits.
African policymakers warned against pressure over climate-linked trade rules (BusinessLIVE)
Policymakers in Africa should not bow to pressure to introduce broad climate-linked trade regulations aimed at reducing emissions in the African Continental Free-Trade Area (AfCFTA) agreement, say trade law experts. Such regulations could prove overly burdensome for African countries that have to rely on fossil fuels to power industrialisation initiatives that would help reduce poverty and unemployment in the world’s least industrialised region, they say.
As wheat prices soar, Africa pivots to cheaper alternatives (Moneyweb)
Global wheat prices are so high that African consumers are starting to ditch the grain from their diet. Food producers in Kenya, Egypt, Democratic Republic of Congo, Nigeria and Cameroon say they’re mixing cheaper alternatives into their breads, pastries and pastas. Local rice, manioc flour and sorghum are substituting for wheat, which has spiked about 40% this year as Russia’s invasion squeezed exports from Ukraine, one of the biggest shippers. These domestic crops are less exposed to trade disruptions and global inflation, thus offering some protection from food prices that remain near record levels. Kenya imports about 44% of its wheat from the Black Sea region, and the surging prices helped stoke inflation to 6.5% in April. Unga Group Plc, the Nairobi-based maker of Exe brand wheat flour and Jogoo maize flour, is seeing a shift in sales to its Amana line of rice and pulses.
The EU is planning to turn to Africa to help wean itself off Russian natural gas, a report says (Business Insider)
Countries in western Africa, like Nigeria, Senegal, and Angola, in particular have largely untapped potential for liquefied natural gas, the European Commission said in the document, per Bloomberg. A number of gas pipeline projects linking Africa to Europe have been studied in recent years, and feasibility studies are ongoing to build the world’s longest offshore pipeline, carrying natural gas from Nigeria to Morocco and Europe, according to a Nigerian presidential adviser. Europe gets about 40% of its natural gas from Russia, but the country’s invasion of Ukraine has accelerated the EU’s efforts to reduce reliance on Russian supplies. The European Commission has proposed cutting EU demand for Russian natural gas by two-thirds before the end of the year under a plan to diversify supplies and speed up the rollout of renewable gases. The EU has agreed to stop imports of Russian coal starting later this year, but hasn’t announced an embargo on natural gas or oil. In the draft strategy document, the European Commission said it planned to boost imports of liquefied natural gas by 50 billion cubic meters and pipeline gas from countries other than Russia by 10 billion cubic meters, per Bloomberg.
World’s Best Banks 2022: Africa (Global Finance)
In March, many banks in Africa reported their 2021 annual results. Across the board, the recurring theme was a return to profitability with a bang. After the banks had witnessed their operations and books ripped apart by Covid-19, 2021 not only marked a return to near normalcy but also a bumper crop of mindboggling results. From a global perspective, 2021 can be summarized as a recovery year, according to Sim Tshabalala, CEO of the Standard Bank Group. For the banking industry, the easing of pandemic restrictions and increased access to vaccines fueled the economic resurgence.
“Having consistently maintained robust balance sheet metrics across capital, liquidity and credit provisions, the results reflect a rebound on the back of a more supportive operating environment and the focused execution of their digitally led strategies,” says Francois Prinsloo, Africa Banking and Capital Markets leader at PwC.
Across Africa, banks are optimistic that the tough season is behind them. Measures taken in 2020 to build up capital buffers to ensure sound footing and preserve credit strength are now paying off. Besides, the problems of provisions for nonperforming loans (NPLs) and forced holdback in lending are no longer necessary.
Yet again, Standard Bank overcame competition from its pan-African and domestic peers to emerge as the Best Bank in Africa overall and its home market of South Africa. Emerging as the top bank on the continent comes against the backdrop of an impressive rebound for the banking powerhouse with operations in 20 countries, seven international markets and 15 million active clients.
Having strong ambitions for Africa made Societe Generale become a formidable banking group on the continent, where it is a leading bank in many countries, with large market shares. “When Africa is inventing its ways of using banking products and services, Societe Generale reaffirms its commitment to playing a key role in this transformation,” reckons the bank’s Goutard.
The bank seeks to help clients take advantage of the African Continental Free Trade Area and focused on connecting Africa with China and the rest of the world as well as further developing intra-Africa trade.
Global economy news
Transparency, analysis, cooperation key to address trade impacts of subsidies — report (WTO)
In her opening remarks to the event, WTO Deputy Director-General Anabel González noted the significant impact subsidies can have on trade and trade policy. Subsidies can distort trade and investment flows, undermine the predictability and stability created by trade commitments, and erode public support for open trade. In addition, important issues have emerged which have prompted new debates about the role of subsidies. These issues include: the emergence of global value chains; digital markets; the global importance of economies in which the state plays a central role, and of international state-owned enterprises; the urgent challenge of climate change; and the recognition that well-crafted subsidies can be an important part of the public response to economic and health emergencies.
TRIPS Council hears initial reactions to Quad’s outcome document on IP COVID-19 response (WTO)
The meeting was the first opportunity for the whole membership to share their initial views on the text forwarded by WTO Director-General Ngozi Okonjo-Iweala and shared immediately by Ambassador Gberie with all delegations after an informal meeting of the TRIPS Council on 3 May. After an impasse of more than one year in the TRIPS Council, DG Okonjo-Iweala, working with Deputy Director-General Anabel González, supported an informal group of ministers’ efforts to come together around what could be a meaningful proposal, without prejudice to their respective positions, that could provide a platform to be built upon by the membership.
Entrepreneurs’ platform needed for businesses to grow, sector players say (Monitor)
Honest, inspirational and properly tailored messages can turn around the fortunes of Micro, Small and Medium Enterprises (MSMES) for the better, according to some experienced sector entrepreneurs. Key sector players further argue that “sharing past experiences among peers – in this case the MSMES – is one of the most fitting prescription needed right now to inspire entrepreneurs whose enterprises are struggling to cope with the Covid-19 pandemic-induced shocks.” In agreement with the above view, global entrepreneur Dr Kalpana Abe observed that veteran entrepreneurs have a responsibility to inspire the upcoming generation. “This inspiration should not only be on how to go about the good times but perhaps most importantly drill them on how to cope with the terrain when the going gets tough,” she said during the Go for Gold campaign launched in Kampala early this week. Just like Dr Kalpana, the CEO of Goldmine Finance, Mr Allan Tayebwa, suggests that “there is no better time than now- to provide motivation and necessary resources to MSMES sector players currently enduring the effects of the pandemic as well as the dire implications of the inflationary pressures on the cost of doing business.”
Small decrease in food prices in April ‘a welcome relief’ (UN News)
The FAO Food Price Index averaged 158.2 points in April, down 0.8 per cent from the surge in March, but remained nearly 30 per cent higher than in April 2021. The Index tracks monthly changes in the international prices of a basket of food commodities, and the decrease was led by a slight decline in the prices of vegetable oils and cereals.
“The small decrease in the index is a welcome relief, particularly for low-income food-deficit countries, but still food prices remain close to their recent highs, reflecting persistent market tightness and posing a challenge to global food security for the most vulnerable,” said Máximo Torero Cullen, FAO Chief Economist.
CHOGM2022 will foster Commonwealth prosperity – SG (The New Times)
The Commonwealth Heads of Government Meeting 2022 (CHOGM2022) will be held from June 20 to 25 in Kigali, Rwanda. This is the 26th CHOGM since 1971, and the second to be held in Africa after that held in Uganda in 2007.
The New Times’ Emmanuel Ntirenganya had an interview with Commonwealth Secretary-General, Patricia Scotland QC on May 04, 2022, in Kigali, about what this major meeting means for this voluntary association of 54 countries home to 2.5 billion people, opportunities that it presents, tackling rising cost of living, and destructive climate change effects.
Q: What opportunities are expected at CHOGM2022, and how could they help address problems such as unemployment, especially among the young people?
A: We have the youth forum where we will be specifically looking at the young entrepreneurs, and how we enable them to get better. But look at the trade initiative that we’ve got. The good thing about our Commonwealth is that we share so much in common: We share common language, common structure in terms of parliamentary structure, we have similar institutions which share the rule of law. All of that makes us more than 21 percent cheaper, easier, faster for us to do trade one with the other.
But, we hope to be at [$]1 trillion by 2030. And you know that in Africa, African countries have become party to the African Continental Free Trade Agreement. So, when you look at the opportunities that brings to Africa and to our Commonwealth, together with the trade facilitation, we believe that working together as the Commonwealth, we will be able to enhance trade, particularly digital trade.
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South Africa working to revive rail as backbone of transport system (CGTN Africa)
South Africa’s National Department of Transport is working with all key stakeholders to bring about a “rail renaissance” in the country, which will position rail as a backbone of the transport system for both passenger and freight. “The government is putting efforts into replacing rail infrastructure damaged by large scale vandalism, and the work to develop rail infrastructure is ongoing while putting measures in place to secure new investment, said South Africa’s Minister of Transport Fikile Mbalula, briefing lawmakers at a parliament session in Cape Town, legislative capital of South Africa. A white paper on national rail policy, approved by the cabinet in March, will give impetus to the development of rail, especially the establishment of a central rail planning unit for the implementation of several rail intervention strategies, he said. Mbalula also said rail infrastructure development will be coordinated from the center and implemented simultaneously across the country in the strategic corridors.
South Africa weighing ban on scrap metal exports to curb infrastructure theft Miningmx)
PRAVIN Gordhan, South Africa’s minister of public enterprises, said the export of scrap metal ought to be halted for a period in order to stop criminal raids on infrastructure that is encouraged by the market. “It is my firm view that the export of scrap must be banned for a while. That will ensure that there is no market externally for the theft of infrastructure,” BusinessLive quoted Gordhan to have said during an economics cluster question-and-answer session in parliament on Wednesday. “The sooner we have a strong set of measures, I believe it will begin to change the face of theft of infrastructure as well,” the minister said. The department of trade, industry & competition is working on the issue, he said.
DP World Maputo handles first citrus reefer export for 2022, offers new direct sailing service (Engineering News)
DP World Maputo says it has successfully handled its first citrus reefer export of the 2022 season. Through a combination of new solutions, including a direct sailing service, DP World hopes to position itself as the “ideal gateway” for the South African citrus industry exporting to the Middle East and Southeast Asia.
Supporting Botswana’s ambition to diversify its economy and accelerate its structural transformation towards sustainable and inclusive growth is the main objective of the African Development Bank Group’s Country Strategy Paper 2022-2026 (CSP 2022-2026) for the Southern African country. Approved in March 2022 by the Bank Group’s Board of Directors, the Country Strategy Paper sets out two priority areas of intervention for the next five years: building economic resilience through support to economic governance and private sector development; and developing quality infrastructure to increase competitiveness and productivity. Under the first priority area, the Bank Group will continue supporting key policy reforms to enhance fiscal performance, strengthen the country’s public financial management systems, and improve public sector efficiency. The Bank Group will also support ongoing efforts to enhance private sector participation in economic activity through enabling regulatory reforms and public-private partnerships. The Bank will expand its support to small and medium-sized enterprises by addressing existing bottlenecks, such as lack of access to finance, to stimulate women’s participation in high value-added economic activities.
Rwanda four-year energy project gets $180m boost (The East Africa)
Rwanda’s four-year energy project has received $180 million from the African Development Bank in a financing deal to raise the number of homes connected to electricity in the next two years. The money is in addition to the $84 million Rwanda received in May last year. Slightly over half of Rwanda’s 13 million population currently have access to electricity. The African Development Bank loan will finance the construction of more than 1,000 kilometres of medium voltage and 3,300 kilometres of low voltage lines to boost last-mile access. It will also build 137 kilometres of high voltage lines and six substations. It is expected to connect 77,470 households to the electricity network for the first time.
Government pledges protection for bilateral investors on AfCFTA (GhanaWeb)
The Government of Ghana has pledged to protect Bilateral Investment Treaties (BITs) for countries that sign agreement with it for reciprocal foreign direct returns on the African Continental Free Trade Area (AfCFT).
The pledge comes in the wake of growing appetite for multilateral agreements. Ghana has ratified BITs with seven countries - China, Denmark, Switzerland, Germany, Malaysia, Britain, and the Netherlands, and looks forward to doing more on AfCFTA.
Kenya’s economy recovers to grow at the fastest rate in 11 years (Citizen Digital)
The Kenyan economy rebounded from COVID-19 led woes in 2020 to grow by 7.5 per cent in 2021 according to fresh data from the Kenya National Bureau of Statistics (KNBS). This to recover from a 0.3 per cent contraction posted in 2020 on the backdrop of the economic strife bought by the pandemic. This is the highest rate of growth for the Kenyan economy since 2010 when gross domestic product (GDP) improved by a record 8.1 per cent according to rebased economic data from the statistician’s office. During the year the economy was largely a beneficiary of low base effects with the reopening of various sectors after the pandemic led closure lifted activity.
IMF drops tough stance on Kenya’s fuel subsidy (Business Daily)
Kenyan officials resisted the push by the International Monetary Fund (IMF) to scrap the fuel subsidy programme that has seen the government spend Sh49.164 billion to stabilise the petroleum prices. Treasury Cabinet Secretary Ukur Yatani said they reached an agreement with the IMF to sustain the programme to cushion the economy from a sharp rise in the cost of living as a result of a global spike in oil prices. Kenya is on a 38-month IMF programme, which has seen the multilateral lender give the country Sh270.2 billion ($2.34 billion) in loans in exchange for a reform package that includes eliminating fuel and tax subsidies to improve revenue collection. IMF staff and the Kenyan authorities reached a staff-level agreement on economic policies to conclude the third review of the programme late last month.
Kenyan clearing firms risk closure as shippers consolidate business (The Star, Kenya)
More than 1,000 Kenyan based clearing and forwarding firms could close in the wake of a takeover by international shipping lines, players in the sector warn. This puts slightly over 10,000 jobs on the line where on average, a clearing firm employees at least 10 people according to the Kenya International Freight and Warehousing Association. There has been an aggressive move by global shipping lines docking in Mombasa to incorporate clearing and forwarding services within their freight packages, threatening to push out small local players. According to the Shippers Council of Eastern Africa (SCEA), the vertical integration model will see shipping lines handle freight, local warehousing, clearing and forwarding and last mile cargo delivery. This is a strategy that allows a company to streamline its operations by taking direct ownership of various stages of its production process rather than relying on external contractors or suppliers.
TPA signs USD 500 million agreement (Dailynews)
THE DP World, an Emirati multinational Logistics Company based in Dubai, United Arab Emirates, has signed a Memorandum of Understanding (MoU), worth USD 500 million, with the Tanzania Ports Authority (TPA) to finance various projects aimed at improving efficiency of the country’s ports. The company specialises in cargo logistics, port terminal operations, maritime services and free trade zones. The agreement for the grant was signed over the weekend at the ongoing Dubai Expo 2020 between TPA Director General Eric Hamissi and DP World Chief Executive Officer Sultan Ahmed Bin Sulayem.
Customs agents again suspend vehicle clearance at ports over 15% NAC levy (Nairametrics)
Clearing agents have again abandoned vehicle clearance at the Tincan Island Port, Lagos State, due to confusion over the unresolved issue of the 15% National Automotive Council (NAC) Levy. The action, which will worsen the congestion problem at the ports, appears to be the escalation of the dispute between the clearing agents and the Nigeria Customs Service (NCS), which the former had described as an obnoxious policy. According to NAN, this disclosure is contained in a statement issued by the President of the National Council of Managing Director of Licensed Customs Agents (NCMDLCA), Mr Lucky Amiwero, in Lagos on Thursday. Amiwero revealed that clearing agents had suspended vehicle clearance at Port and Terminal Multiservices Limited as well as Five Star Terminal at the Tincan Island Port.
Amiwero said that there is confusion with regard to Nigeria Customs Service’s `shifting’ of the 15% NAC Levy to Common External Tariff (CET). He said, “Though the Federal Ministry of Finance changed the heading to Common External Tariff (CET), clearing agents still describe the new levy as illegal. It is not backed by law in Nigeria,”
“It also contravenes the World Trade Organisation under the Agreement on Trade Facilitation Agreement which core principle is predictability, consistency and transparency on trade information, fees and charges imposed in connection with importation and exportation.’’
Nigeria’s new seaport aims to become African shipment hub (Reuters)
Nigeria expects to become an African hub for transshipment with a new deep seaport set to open in the commercial capital of Lagos before the end of this year, its managing director said on Wednesday. Du Ruogang, managing director of Lekki Deep Sea Port -- owned 75% by China Harbour Engineering Company and Tolaram group with the balance between Lagos state government and the Nigerian Port Authority, said the port has reached 89% completion. The multi-billion dollar deep seaport which has been under development for more than a decade and is situated on the edge of Lagos is part of new infrastructure that Nigeria hopes it can use to boost trade.
“With this port, Nigeria will become a transshipment hub,” Information Minister Lai Mohammed said during a site tour.
We Must Look Inwards To Reduce Rising Debts, DMO Insists (The Tide)
Faced with rising debts, Africa must look inwards, the Director-General (D-G) of the Debt Management Office (DMO), Ms. Patience Oniha, has advised. She spoke at the launch of the report of a Debt Sustainability study commissioned by the Open Society Initiative for West Africa (OSIWA) and the Nigerian Economic Summit Group (NESG) under the Debt Management Roundtable (DMR), in Abuja, yesterday. According to her, the stark realities confronting Sub-Saharan Africa were such that only a new focus on revenue generation from within; could save the region from a debt crisis. She said, “The timing of the launch of the report could not have been more appropriate with the global debt levels already rising pre-COVID-19 and still growing since the COVID-19 pandemic started in the year 2020. “Concerns around debt sustainability have expectedly heightened. According to the Word Bank’s World Economic Outlook, ‘Globally, sovereign debt grew from 49.1per cent of GDP in 2014 to 57.9percent in 2019. And in Sub-Saharan Africa, from 35.1per cent of GDP in 2014 to 55.4percent in 2019.’” The respective figures for 2021 were 66.7percent and 60.3percent.
NNPC Identifies Gas As Transition Fuel (The Tide)
The Federal Government has said that it was focusing on exploitation of gas to close the gap that can be created by less use of petrol, diesel and other fossil fuels, following the gradual exit from fossil fuels. The Chairman, Board of the Nigerian National Petroleum Company Ltd. (NNPC), Mrs Margrey Chuba-Okadigbo, stated this in her remarks at the ongoing Offshore Technology Conference (OTC) in Houston, Texas in United States, last Wednesday. The conference was anchored by the Petroleum Technology Association of Nigeria (PETAN), the umbrella body of all the indigenous oil services companies in Nigeria. According to Chuba-Okadigbo, gas as a transition fuel would not only bridge the energy gap to be created by exit of fossil fuels, but enhance economic development
At €28.7bn, EU Remains Nigeria’s Strongest Trade Partner, Says Envoy (This Day)
The Head of the European Union (EU) Delegation to Nigeria, Ambassador Samuela Isopi has said the Union remains Nigeria’s strongest trade partner over the years. Isopi, who is also the head of the EU Delegation to the rest of the Economic Community of West African States (ECOWAS), while addressing a press conference in Abuja, on the forthcoming Europe Day 2022, and also provide information on several issues, including the European Union’s engagements with Nigeria and with ECOWAS, revealed that the total EU-Nigeria trade in 2021 stood at €28.7 billion. She put EU’s imports from Nigeria at €17.5 billion with exports to the country in 2021 at €11.2 billion. The EU Head disclosed that the trade balance in 2021 stood at €6.4 billion in favour of Nigeria, while the year-on- year change between 2020 and 2021 recorded a surplus of 25.8 percent.
India-Nigeria relations: Onyeama calls for stronger ties (The Sun)
The Minister of Foreign Affairs, Geoffrey Onyeama, has called for stronger ties between Nigeria and India.
This was even as Onyeama said the African Continental Free Trade Area (AfCFTA) is a “game-changer” that is going to be the largest free trade area in the world.
Onyeama made the call during the 7th Raisina Dialogue in New Delhi India where he took part in two-panel discussions with the themes “Out of Africa: Leading on Trade and Economic Integration,” and “Building the Gates of Globalisation: Investment, Infrastructure and Taboos.”
During the panel discussion, Onyeama spoke about the various partnerships for infrastructural development such as the Belt and Road Initiative (BRI) and other initiatives with India, the European Union, and other African countries, all of which he said, contribute enormously towards development.
U.S. Support to Apparel Industry Empowers Women and Contributes to Ghana’s Economic Growth (US Embassy in Ghana)
The United States Agency for International Development’s (USAID’s) West Africa Trade and Investment Hub today convened representatives from large apparel companies to hear about opportunities to strengthen economic growth in Ghana and empower women and women-owned businesses. Three USAID co-investment partners working in the apparel industry shared their experiences working with the Hub. “Today’s event highlights the major shift underway in the structure of the global apparel industry. Buyers are actively diversifying their supply chains and seeking more competitive price points,” said Janean Davis, Acting Mission Director for USAID/Ghana. “This presents a tremendous opportunity for economic growth in Ghana, and for Ghanaian women who have proven to be integral to the success of apparel companies DTRT, Global Mamas and Ethical Apparel. USAID is proud to support them.”
The event, titled “Empowering Women in Ghana’s Apparel Sector: Challenges & Success Strategies,” featured first-hand accounts of the emerging opportunities for Ghana as a major sourcing hub for global apparel manufacturing. Representatives from the three USAID co-investment partners—DTRT Apparel, Ethical Apparel Africa, and Global Mamas—explained how women’s equity and empowerment are key business objectives for their companies and pay off in business production and growth.
Africa
AfCFTA: Cross-border Service Integration’ll Boost African Oil & Gas Industry - Briggs (Leadership)
The chairman of Platform Petroleum Limited, Chief (Barr.) Dumo Lulu Briggs, has admonished that cross-border service integration through the implementation of the African Continental Free Trade Area (AfCFTA) will boost the African oil and gas industry. Briggs, who spoke on the theme ‘AfCFTA: Cross-border Service Integration As Enabler of Project Delivery in the African Oil and Gas Industry’ at the African local content collaboration session at the 2022 Offshore Technology Conference in Houston Texas, United States of America, noted that AfCFTA represents a new optimism and the continental approach at comparable scale is expected to have greater success in Africa. “Hopefully, collaborations would improve the intra-Africa trade flows which is a poor 15% compared to North America (48%), Asia (58%) and Europe (67%). Although recorded trade underestimates the volume of actual trade and if proper account was taken of the size of the informal trades, the African numbers would not look so out of line. Nevertheless, this statistic confirms that Africa trades with the rest of the world, not with itself, a trend which the AfCFTA aims to revolutionise through the creation of a single market for free movement of goods, services, and persons,” he said.
AfCFTA: Local content drive key to deepen sustainable growth in Africa – Wabote (Vanguard)
Executive Secretary of the Nigerian Content Development and Monitoring Board (NCDMB) Engr Simbi Wabote, has stressed that African countries must leverage on the robust platform and opportunities presented by African Continental Free Trade Area (AfCFTA) agreement, which according to him, is key to drive home the Local Content narrative to achieve sustainable growth and development in Africa.
Wabote made this clarion call while speaking during the African Local Content Collaboration Session at the ongoing Offshore Technology Conference (OTC) in Houston Texas, USA.
Speaking on the theme: ‘Cross-Border Service Integration As Enabler Of Project Delivery In The African Oil And Gas Industry’, the NCDMB boss noted that the AfCFTA is “Africa’s move to harmonize it’s markets for economic integration across all 55 member states with the objective of tapping into the Gross Domestic Product of over $3trillion.”
FG: AfCTA, Game Changer, to Emerge as World’s Largest Free Trade Area (This Day)
The Minister of Foreign Affairs, Geoffrey Onyeama has said the African Continental Free Trade Area (AfCFTA) would be a “game changer,” adding that the continental trade pact would emerge as the largest free trade area in the world. In addition, he said it would make doing business much easier for countries with seamless access to 54 markets which is a huge advantage. The minister who attended the 7th Raisina Dialogue in New Delhi India, where he took part in two panel discussions with the themes: “Out of Africa: Leading on Trade and Economic Integration,” and “Building the Gates of Globalisation: Investment: Infrastructure and Taboos,” called for stronger ties between Nigeria and India.
He said: “Why I say AfCTA is going to be a game changer is because it will make it easier for our political leaders and Africans to reach out to other African countries so what will come as a result or consequences will be infrastructure- the trans saharan highway and continental highway across Africa promoting connectivity and doing business. “That will be the natural result of pulling down all the barriers that are preventing this connectivity within the continent.”
Mohammed said Nigeria wanted to use the port investment to regain maritime business lost to ports in Togo, Ivory Coast and Ghana, adding that the new facility will give the country an edge on African trade.
Trade Finance Demand and Supply in Africa: Evidence from Kenya and Tanzania (AfDB, pdf)
Since 2014, the African Development Bank has provided leading research on the trade finance landscape in Africa. Its trade finance reports have surveyed and analyzed trade finance data for more than 600 individual banks in 49 African countries from 2012 to 2019. The studies have contributed to filling the knowledge gap on trade finance supply in Africa and put trade finance unmet demand on the agenda of policymakers globally (International Chamber of Commerce, 2020). Yet, the story has always been half told – using data only from the perspective of commercial banks that supply trade finance – with analyses of trade finance demand by firms completely missing from previous studies. Part of the reason for this incomplete picture is the lack of access to data on the trade finance activities of firms.
This report attempts to fill some of this knowledge gap. It presents the results of a comprehensive survey on trade finance demand in Africa, using the cases of Kenya and Tanzania as a deep-dive study. It is the first of its kind on trade finance demand in Africa. We focus on the cases of Kenya and Tanzania due to the relative openness of these economies. Firms in Kenya and Tanzania are active in international markets, with significant sectoral diversity. Close to 63 percent of firms in the two economies use material inputs and supplies of foreign origin. This is higher than the average of 58.6 percent for the sub-Saharan Africa region as a whole (World Bank, 2022). In addition, the total trade to GDP ratio, a measure of the relative openness of an economy, stands at about 22 percent and 23 percent for Kenya and Tanzania, respectively, higher than the sub-Saharan Africa average of 17 percent.
EAC Ministers adopt 35% as the EAC CET 4th Band (EAC)
East African Community (EAC) Ministers / Cabinet Secretary in charge of Trade and Finance have adopted 35 percent as the 4th Band of the EAC Common External Tariff (CET). The Ministers, during a retreat on the comprehensive review of the CET, held on 5th May 2022, in Mombasa, Kenya, decided that implementation of the reviewed EAC CET shall commence on 1st July, 2022. The meeting further agreed that there should be flexibility in implementation of the revised CET, particularly on products currently affected by the current global economic realities.
The Secretary General said the CET is one of the key instruments under the Customs Union pillar which justifies regional integration through uniform treatment of goods imported from third parties. “The move is set to spur intra-regional trade by encouraging local manufacturing, value addition and industrialization,” said Dr. Mathuki.
Among the tariff lines in this 4th band include: dairy and meat products, cereals, cotton and textiles, iron and steel, edible oils, and beverages and spirits.
You win some, you lose some in EAC (The Star, Kenya)
Kenya has been part of the East African Common Market since 2010. In a single market, countries win some and lose some. Kenyan workers are employed in all East African member states because they get automatic work permits and are hard-working and well-qualified. That is a benefit. However the import of cheap maize, eggs and poultry from Uganda and Tanzania is a cost. Their farmers can produce at a lower price than Kenya because land and labour are cheaper. But it is not a cost to all Kenyans because the import of cheaper food from neighbouring states brings down the cost of living for the wananchi. This is how a single market works. Over time, capital and labour are invested where they make the best return. That’s why farmers in Trans Nzoia are giving up growing maize in favour of raising chicken. That’s why the cost of eggs went up last year when Kenya temporarily blocked the import of Ugandan eggs. But, over time, everyone should be a winner in a single market. Each national economy will grow larger as it exports more and imports what is cheaper.
The Government of the Republic of Madagascar recently approved the move to sign the SADC Charter establishing the SADC Regional Fisheries Monitoring Control Surveillance Coordination Centre (MCSCC) on 28 April 2022. This paves way for Madagascar to join in the regional cooperation for combating illegal, unreported and unregulated (IUU) fishing and related fish crimes. The objective of the Charter is to provide a legal framework for the establishment and operationalisation of the MCSCC, which will coordinate measures relating to fisheries monitoring control and surveillance (MCS) in the SADC region.
Right policies can spur investment in African vaccines (Business Daily)
Inadequacies in drug production and challenges posed by counterfeit and substandard products have often crippled access to medicines in Africa. To tackle this, the African Union (AU) called for strengthened, improved and harmonised regulation of medicines, medical products and technologies across the continent. On February 11, 2019, in Addis Ababa, Ethiopia, heads of state and governments during their 32nd Ordinary Session adopted the African Medicines Agency (AMA) treaty to provide support for weak regulatory systems.
The new African Medicines Agency Treaty currently has 28 signatories, accounting for more than half of the African Union’s 55-member states.
Ukraine war to hit North African economies as GCC set to record twin surpluses: Capital Economics (Arab News)
Russia’s invasion of Ukraine has pushed up the cost of living in a host of North African countries, according to a report by Capital Economics. Egypt, Tunisia, and Morocco are all battling increases in inflation, at 10.5 percent, 7.2 percent, and 5.3 percent respectively, according to analysts. Increased public debt also has become a rising issue, with Tunisia incurring another loan from the African Export-Import Bank. The increasing prices have left these countries drowning in their accumulated debts, leading to a forced decline in their sovereign dollar bond and currency value. “Within the region, Tunisia’s public debt position is most fragile and the government now faces a ballooning subsidy bill. We think that a debt restructuring will ultimately be needed,” the report said, adding: “The devaluation of the Egyptian pound has coincided with concerns about the growing share of public debt that is denominated in FX.”
Africa calls for accelerated fiscal decentralisation at the UNGA meeting on sustainable urbanisation (UNECA)
Ministers from across Africa have called for accelerated fiscal decentralisation efforts to spur sustainable urbanisation as an enabler of inclusive growth and prosperity. This was the overarching message from their joint statement delivered by Malawi’s Minister of Land H.E Samuel Kawale at
The African Union High Level Panel on Emerging Technologies Appoints Two New Members (NEPAD)
The Chairperson of the African Union Commission, H.E. Moussa Faki Mahamat, has appointed two eminent experts to serve on the AU High-Level Panel on Emerging Technologies (APET). The High-Level Panel was constituted in recognition of the need of African Union Member States to harness both existing and emerging technologies for Africa’s socio-economic development. The announcement was made during the first statutory meeting of APET in 2022, held in Johannesburg from 25 to 29 April 2022. The objectives of the statutory meeting were to discuss strategies for a strengthened APET structure within the AU system and deliberate on strategies for the optimisation of the work of the Panel through engaging global and continental experts and platforms. The Panel also considered sustainable resource avenues for its secretariat through securing steady support for the next 10-20 years. Lastly, APET paid a courtesy visit to the outgoing CEO of AUDA-NEPAD, Dr Ibrahim Assane Mayaki.
COP27 presents a unique opportunity for Africa (Africa Renewal)
Talking about achievements, with regards to peace and security, it is important to note that as part of Angola´s leadership of the International Conference on the Great Lakes Region (ICGLR) for the second time, our President João Lourenço, in his capacity as Chair, briefed the UN Security Council in June 2021 at a meeting dedicated to the situation in the Central Africa Republic. He called for an end to the arms embargo imposed on the country. In addition, Angola continues to contribute and support a peaceful resolution of the conflict in Eastern Democratic Republic of Congo. Also in 2021, Angola presented for the first time its National Voluntary Review at the High-Level Political Forum on the implementation of the 2030 Development Agenda for Sustainable Development.
Our main priority for this year is to continue to focus on peace and security with particular emphasis on Africa, specifically our sub-region.
We will also continue to pay attention to programmes that foster humanitarian assistance to vulnerable groups, including women and children, environmental protection and sustainable development. 17 duplicates removed
Africa fully committed to harnessing its clean energy potential with the African Development Bank (AfDB)
In November 2021, stakeholders from around the world gathered in Kinshasa, Democratic Republic of Congo (DRC) for the DRC Business Forum to discuss moving Africa up the ladder in the battery, electric vehicle and renewable energy value chain and market. This event affirmed the continent’s ambition to harness its green energy potential and totally eliminate greenhouse gas emissions by 2050. The African Development Bank was one of the co-hosts of the DRC Forum, a clear sign of the Bank’s commitment to supporting Africa’s energy transition. The following projects supported by the African Development Bank symbolize the continent’s efforts to reduce greenhouse gases, even though it is only responsible for 3.8% of global emissions: The Noor Ouarzazate Complex, south-east of Marrakesh, had ushered Africa into a new era at the beginning of the 2020s. With a capacity of 580 megawatts spread over four power plants, the complex is one of the biggest solar parks in the world. More importantly, it supplies electricity to nearly two million Moroccans and prevents the release into the atmosphere of nearly one million tonnes of greenhouse gases every year.
The Future of Marine Fisheries in the African Blue Economy (AfDB)
The marine capture fisheries production of Africa currently stands at 7 million tonnes. It has increased in recent years thanks to the strong resurgence of West African small pelagic catches and a return to normality in the Indian Ocean following the end of Somalian piracy. The marine fish supply is increasing but the current positive growth is at a rate that cannot match the increasing population’s per capita consumption demands. With the African population expected to reach 1.7 billion in 2030 and 2.5 billion in 2050, feeding the population at today’s level of per capita consumption (7.5 kg/capita/year form marine fisheries), will require 13 million tonnes of marine fish in 2030 and almost 19 million tonnes in 2050. These figures provide an idea of the scale of the production gap: about 6 million tonnes in 2030 and 12 million in 2050. They also make it clear that much change is required in both ecosystem capacity enhancement and capture and valorisation method improvement to reach such targets. Fisheries policies, institutional structures and the skills base of fisheries agencies in many African countries have been heavily influenced by a historical focus on production and revenue maximisation year-after-year, driven by the need to generate cash for the national treasury, with little or no reference to resource productivity and sustainability. The approach has led to overexploitation of most of the major fish resources. 17 duplicates removed
12th Africa anti-corruption conference opens with clarion call for collective action to stamp out corruption (The Commonwealth)
Heads of anti-corruption agencies from the Commonwealth’s 19 African member states and stakeholders met yesterday in Kigali, Rwanda, for the 12th Regional Conference of Heads of Anti-Corruption Agencies in Commonwealth Africa. The five-day conference, which is being convened under the theme ‘Combating Corruption for Good Governance and Sustainable Development in Africa’, opened with a clarion call from delegates for the need to strengthen cooperation and collaboration among anti-corruption agencies in Commonwealth Africa to help address the gaps in fighting corruption.
Japan, Africa look to deepen trade ties (Africa Times)
Japan is looking to expand its presence on the African continent, with trade and investment taking center stage during the Japan-Africa Public-Private Economic Forum held in Nairobi. The event attracted seven ministerial-level leaders and over 200 participants from 15 countries, according to the Kenyan trade ministry. Among them was Takako Suzuki, a Japanese state minister of foreign affairs who attended the event while on an African tour that also took her to Rwanda. Suzuki’s presentation, above, offered a look at what to expect in August when Tunisia hosts the Eighth Tokyo International Conference on African Development (TICAD). Suzuki said Japan is looking to invest in startup firms and seeks to boost climate-friendly, sustainable business development in Africa.
Global economy news
DG Okonjo-Iweala: Members can deliver results at MC12 despite challenging circumstances (WTO)
Speaking to heads of WTO member delegations, the Director-General observed that ministers would gather at WTO headquarters next month against a backdrop of the COVID-19 pandemic, rising food and energy prices, debt distress, and war. “This is not an ordinary Ministerial Conference,” she said. The difficult context made reaching agreements both harder and more urgently necessary, she noted, urging delegations to be open-minded and flexible on substance and in how they engage with each other.
Describing her wish for a “streamlined, business-like” MC12, DG Okonjo-Iweala said delegations need to achieve clarity about how they want to use the meeting. She urged them to finalize outcomes ahead of time so that ministers can “bless” them and focus on providing guidance for future work. “MC12 should not simply be a talk shop,” she said.
The war in Ukraine could bring economies of poorest countries on brink of catastrophe (Trade for Development News)
The impact of the war in Ukraine on food and fuel prices will weaken economies already battered by the COVID-19 pandemic and climate-related disasters. We live in an interconnected world where the impact of missile strikes on a Ukrainian city can be felt as far away as in Ouagadougou, the capital of Burkina Faso in West Africa, through price hikes on a bag of wheat or at a fuel pump. In its April World Economic Outlook update, the International Monetary Fund (IMF) has slashed the Global growth forecast by 0.8 per cent to 3.6 per cent in 2022 compared to the January forecast with the economic impact of the war in Ukraine reverberating globally through the commodities market, trade and financial linkages. Much has been made of Europe’s heavy dependence on Russia for its energy needs. Less visible – but no less important – is the pain of higher fuel and food prices across many parts of the world due to supply disruptions from the world’s second-biggest oil exporter – Russia – and the world’s fifth-largest exporter of wheat – Ukraine – caused by the war and related sanctions.
Least developed countries (LDCs) have been vulnerable and in dire need of support in the best of times. With the triple onslaught of climate change, COVID-19 and the war in Ukraine, we are facing a potential human catastrophe.
As the Director-General of the WTO stated, the current system “was not built for a world where a climate disaster can interrupt factory operations worldwide, or a microscopic virus can upend the movement of goods, services and people almost overnight. This is no case for a retreat from trade, which helps us adapt to those and other shocks.”
Lower oil reliance insulates world from 1970s style crude shock (IMF Blog)
The war in Ukraine and sanctions on Russia are causing substantial economic spillovers, notably for energy. Oil prices have climbed, but increases have largely been contained thanks to spare production capacity in some countries and strategic petroleum reserves in others.
Brent crude, the global oil benchmark, rose to a seven-year high around $100 before the invasion sent it surging to more than $130. It has since pared gains amid pandemic lockdowns in China, the biggest oil importer, that may weigh on economic growth there. Memories of the high inflation and slow growth that followed—known as stagflation—have fueled concerns about a possible repeat. Importantly, though, times have changed.
A Decade of Stalled Progress on Reducing Global Gas Flaring (World Bank)
Global progress to reduce gas flaring, the wasteful industry practice of burning natural gas during oil production, has stalled over the last decade. Globally, gas flaring resulted in nearly 400 million tonnes of carbon dioxide (CO2) equivalent emissions in 2021, further underscoring the urgency to accelerate the decarbonization of the world’s economies, says a new report from the World Bank’s Global Gas Flaring Reduction Partnership (GGFR). Satellite data compiled and analyzed for GGFR’s 2022 Global Gas Flaring Tracker Report shows that 144 billion cubic meters (bcm) of gas was flared at upstream oil and gas facilities last year. Ten oil-producing and flaring countries accounted for three-quarters of all gas flaring, seven of which — Russia, Iraq, Iran, the United States, Venezuela, Algeria, and Nigeria — have remained the top seven consistently over the last ten years.”Climate change is one of the defining development challenges of our time. Ending the polluting and wasteful practice of gas flaring and decarbonizing oil and gas production, while also accelerating the transition to cleaner energy, is fundamental to mitigating climate change,” said Demetrios Papathanasiou, Global Director for the Energy and Extractives Global Practice at the World Bank.
How fintech solutions can bridge the trade financing gap (Wanda)
The pandemic’s impact on trade and supply chains was significant and in turn, also impacted economic growth and well-being. At the same time, the crisis led to an acceleration in the digitisation of business models, including cross-border business-to-business (B2B) e-commerce as a response to disruptions in supply chains. From the onset of Covid-19, fintech startups emerged to help businesses fund global partnerships and secure digital trade financing through game-changing non-recourse factoring.
According to an Asian Development Bank (ADB) study, rejection rates for trade finance reached record highs in 2020, with the gap between demand and supply currently at $1.7 trillion – a 15 per cent rise compared to the previous estimate of $1.5 trillion in 2018. The impact on supply and demand gap is particularly pronounced as the nature of the crisis continues to cause a negative ripple from downstream customer firms to upstream supplier firms. The ADB’s latest research reiterates findings from previous studies that the trade finance gap disproportionately affects smaller enterprises, which are also strongly affected by supply chain disruptions. Approximately 40 per cent of rejected trade finance requests were from startups and small and medium-sized enterprises (SMEs) compared to a rejection of 17 per cent for multinationals. The survey covers more than 300 firms in almost 70 countries, beyond 112 banks, 50 export credit agencies, and 39 forfeiters around the globe. The lack of creditworthiness and lack of ability to provide financial statements are among the most prominent reasons to reject requests from businesses seeking trade finance.
Fintech companies are uniquely positioned to fill the gap and help startups access flexible injections of liquidity exactly when they need it, as well as set up digital processes that allow them to successfully trade internationally. Many fintech companies are able to offer cheaper, and better trade finance and other export solutions to startups. Since their due diligence is primarily technology-driven, they are usually less persistent on collaterals and more reliant on technology solutions to identify credit-worthy borrowers.
OECD countries advancing slowly on sustainable development targets by 2030 - OECD (OECD)
Despite progress made since the adoption of the 2030 Agenda for Sustainable Development and its 17 Goals (SDGs), OECD countries have met or are close to meeting only a quarter of the targets for which performance can be gauged, according to a new OECD report. Virtually all OECD countries are already securing basic economic needs and implementing the policy tools and frameworks mentioned in the 2030 Agenda. But progress towards 21 targets on issues such as ensuring no one is left behind, restoring trust in institutions and limiting pressures on the natural environment are still way off track. The Short and Winding Road to 2030: Measuring Distance to the SDG Targets says that while OECD countries have eradicated extreme poverty, most of them need to do more to reduce deprivation more broadly. Women, young adults and migrants face greater challenges than the rest of the population, and despite some progress, women’s rights and opportunities are still limited in both private and public spheres. In addition, unhealthy behaviours such as malnutrition and tobacco consumption, which appear to be more common among low socio-economic groups, and disparities in education from early years of life, tend to exacerbate inequalities.
World Trade Congress on Gender: Deadline for submitting papers extended to 1 July (WTO)
The World Trade Congress on Gender is part of the research agenda undertaken by the WTO Gender Research Hub and the WTO Trade and Gender Unit. It will draw attention to the findings of published or soon-to-be published research conducted by trade and gender experts and promote innovative research in this field. Submissions are open for both members and non-members of the Hub. The theme of the Congress intends to highlight the trade and gender issues related to the recovery from the COVID-19 pandemic. It also provides an opportunity to deepen understanding of how women’s empowerment can help countries overcome future crises, whether environmental, financial or food security related — and how trade can contribute to this. The Hub further invites participants to reflect on the extent to which trade can accelerate recovery and help rebuild a gender-responsive economic environment after crises.
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SA exports reach all-time high in March, thanks mainly to coal (Daily Maverick)
Of late, the war in Ukraine has led to further upward pressure on the prices of several of South Africa’s key export commodities, especially iron ore and coal. It is clear that the sharp rise in the country’s export earnings has been fuelled by a continuation of the upward phase of the current commodity price super-cycle, especially for coal.
Continued success for SA citrus industry demands integrated management (Fresh Plaza)
More than 60% of South Africa’s annual citrus production is destined for the export market, a trade that earned R30 billion in foreign exchange in 2021. According to the industry forecasts, export production can increase by up to 500,000 tons over the next three years.
South Africa: Should VAT and tariffs be lifted on chicken? (Poultry World)
The proposal by Paul Matthew, CEO of the Association of Meat Importers and Exporters (AMIE), to suspend existing tariffs and not impose any new tariffs for the next 3 years is superficially appealing but economically dangerous, said Izaak Breitenbach, head of the Broiler Organisation at the South African Poultry Association (SAPA). The poultry sector master plan, which was implemented in 2019, aims to curb imports and expand local demand and local production for the South African and export markets, meanwhile creating nearly 5,000 local jobs.
Rich countries are finalising a deal to move South Africa away from coal (BusinessTech)
The hope is that agreements can be reached with those countries before COP27, the people said, and that details of the South Africa pact will be finalized by then. But negotiations have been snarled by national politics and Russia’s war in Ukraine, which has made the dirtiest fossil fuel a lucrative commodity to mine and export, according to people familiar with the talks who asked not to be identified because the discussions are private.
Most SMEs have no domestic quality certification for export; unable to compete internationally - Survey (Myjoyonline)
A large number of Ghanaian Small and Medium Scale Enterprises have no domestic quality certification for export and no internationally-recognised quality certification, a research conducted by CUTS International has revealed. This simply means that most of them are unable to compete in the African or international market.
The findings also revealed that most of the SMEs also have excess capacities and lack a functioning management structure, and this notwithstanding, most of these firms have not made sufficient investments in the production, finishing and packaging of their products to meet international standards.
“Ghanaian SMEs are uncompetitive and hence, a lot of work and efforts are needed by these firms, policy makers and government to boost their competitive capabilities. Most of these firms also lack connectivity to their clients and suppliers with few using emails and website”, the report disclosed.
Exports into Comesa can rise to US$4,1bn (The Herald)
ZIMBABWE has potential to contribute US$4,1 billion annually to the total value of trade within the Common Market for Eastern and Southern Africa (Comesa) through exports into the regional trade block if a host of bottlenecks facing the region are addressed. The regional trading bloc said the major constraints hindering exploitation of the identified potential is weak productive capacities in member States.
Namibian exporters seek clarity on Angolan import decree (The Namibia)
An Agolan delegation of trade experts visited Namibia to clarify issues around that country’s Presidential Decree No. 23/19. This was revealed on Tuesday during a meeting between the Namibia Chamber of Commerce and Industry and the Angolan delegation at Swakopmund. The decree gives priority to 54 product categories produced in Angola, by requiring that importers demonstrate that they either cannot find a product locally or already have a contract to purchase products on the domestic market. It is aimed at reducing reliance on imports that Angola has the capacity to produce by increasing local production.
Kenya’s mitumba dealers push for setting up of re-export facilities (The East African)
Dealers in second-hand clothes (mitumba) in Kenya want the government to introduce sorting centres, saying such facilities would allow the country to export clothing to high-demand markets in the US and Europe.. Kenya and other EAC member countries have been planning for a reduction in reliance on second-hand clothes by advancing policies to ban the trade, pushing for the revival of the cotton growing industry, and getting local fabric manufacturers to increase local apparel production and sale.
Kenya to benefit from partnership with Japan (The Star, Kenya)
Kenya has signed at least 12 MoUs with Japan in finance, energy, health care and other fields. On Tuesday, public and private sector firms from Japan signed more than 15 MoUs with Kenyan firms and state organisations in Africa, 12 of which directly affect Kenya. The Kenya MoUs were signed to consolidate cooperation and collaboration between the public and private sectors in both Japan and Africa.
Trade CS Betty Maina said relations between Africa and Asia have grown significantly , with Japan having a fairly reciprocal trade pattern. In 2020, Africa’s exports to Japan totalled $8.6 billion (Sh996,13) whereas African imports from Japan were approximately $7.9 billion. Japan has been instrumental in the development of Africa. It has enhanced the role of regional integration through the Regional Economic Communities to Expand industrialisation, trade and investments.
Raw commodity exports exposing Africa to external shocks: Dr Nzenza (Chronicle)
Over reliance on raw commodity exports renders Africa vulnerable to external shocks and the solution lies in transforming the continent from a raw material exporter to a producer of market-competitive value-added goods, Industry and Commerce Minister, Dr Sekai Nzenza, has said. By producing market competitive value-added goods, Africa’s value chains would, therefore, be linked to global chains. “Most of the African countries still rely heavily on production and export of commodities with minimum value addition and even fewer forward and backward linkages to other sectors of the economy,” she said.
“The Regional Economic Communities (RECs) on our continent are more connected to other third-party RECs outside the continent, wherein African countries source the same goods, mainly manufactured, and services that are produced by sister African countries on the same Continent.”
New round of Kenya-US trade talks starts (Business Daily)
The US government and Kenya will from Tuesday start another round of trade talks, signalling a fresh direction after the Biden administration froze Trump-era negotiations on the free trade agreement. The proposed trade deal has faced delays after the Biden administration sought more time to scrutinise the pact negotiated by Donald Trump.
AfCFTA committee begins development of policies to facilitate trade in Nigeria (TheCable)
The national action committee on the African Continental Free Trade Area (AfCFTA) says it has commenced the development of policies in collaboration with relevant export agencies for the free flow of trade in Nigeria.
Power: Investors spent N72bn on alternative sources –MAN (New Telegraph)
He lamented that uncompetitiveness with other challenges retarded the propensity of the manufacturers to penetrate the 1.3 billion continental market across 54 countries in Africa under the African Continental Free Trade Area (AfCFTA).
Dependence On Import, Bane Of Naira Depreciation -CBN (The Tide)
Nwanisiobi, who was represented by the Deputy Director, Corporate Communications Department, said during the Covid-19 pandemic, the CBN’s Anchor Borrower’s programme was the nation’s saving grace for improved rice availability. The apex bank consequently urge Nigerians to adopt homemade products to boost Nigeria’s economy and stop the Naira from depreciating further in the parallel market.
Nigeria seeking funding for gas pipeline to Morocco (Daily Trust)
Nigeria and Morocco are still seeking funding for a huge pipeline project that will carry Nigeria’s gas to North Africa and onto European markets, Minister of State, Petroleum Resources, Timipre Sylva, said. He said, “We want to continue that same pipeline all the way to Morocco down the coast.
7 years after, FG yet to implement Aviation Development Roadmap (Daily Trust)
With about one year and one month to the end of the administration, stakeholders are anxious about the implementation of the roadmap which they said looks good on paper but its implementation will catalyse into bequeathing a better aviation industry in Nigeria. While the move to float the national carrier code-named Nigeria Air has missed several targets, the government has promised to unveil it this year amidst doubts from stakeholders.
Nigeria, UK parley to boost £3.2b trade relationship (The Guardian Nigeria)
“Through the Economic and Development Forum, we can demonstrate how trade is a force for good, creating jobs and prosperity and reaffirming our commitment to boost economic ties, support businesses, and grow new markets.” Nigeria Minister for Industry, Trade and Investment, Niyi Adebayo said: “The Nigerian government is committed to implementing reforms that can attract more foreign direct investment into key industries, boost trade and development and create employment opportunities for Nigeria’s youth by leveraging technology.
Foreign Airlines Reject Nigerian Goods to European Destinations (This Day)
Chinedu Eze Operators at the cargo terminal of the Murtala Mohammed International Airport (MMIA), have confirmed that currently some foreign airlines have refused to airlift cargo from Nigeria to European destinations, except London. The airlines that refused to airlift Nigerian cargo include Turkish Airlines, Air France, Lufthansa and KLM. Managing Director of Flights and Logistics Solutions.
15% Levy on Imported Used Vehicles Illegal, Clearing Agents Tell Buhari (This Day)
Eromosele Abiodun Clearing agents under the aegis of the National Council of Managing Director of Licensed Customs Agents (NCMDLCA), have told President Muhammadu Buhari that there is no provision for the National Automotive Council (NAC) levy of 15 per cent in either the 2020 or 2021 Finance Act, stressing that its implementation by the Nigeria Customs Service (NCS) is illegal.
FG warns APM terminals, others over non-compliance with trade policy (Vanguard)
The Federal Government has warned APM terminals at Apapa and others to adhere to government’s freight forwarders’ directive on the collection of practitioners operating fee, POF.
Speaking during a meeting between officials of the Ministry of Transportation and Council for the Regulation of Freight Forwarders and terminal operators in Lagos weekend, Permanent Secretary of the ministry, Dr. Magdalene Ajani, said since the introduction of the policy on February 24, 2021, some terminal operators have failed to comply with the agreement reached, which has resulted to loss of revenue to the country.
India, Mauritius Trade Pact May Include Safeguard Mechanism Related Provisions (News18)
India-Mauritius trade agreement may include safeguard mechanism related provisions to protect the domestic industry from a sudden or unusual surge in imports of goods, according to sources. Similarly, in the India-Australia economic cooperation and trade agreement, there is a provision for a safeguard mechanism that includes stricter rules of origin to prevent any routing of products from a third country, and it also deals with any unusual surge in imports.
New World Bank Report Identifies Reforms to Improve State-Owned Enterprises in the Gambia (World Bank)
The Gambia has made significant progress in reforming State-Owned Enterprises (SOEs), but major efforts are still required to establish a sound, efficient and financially sustainable SOE sector, according to a new World Bank report released today.
The Gambia Integrated State-Owned Enterprises Framework (iSOEF) report applies the new World Bank iSOEF methodology to assess The Gambia´s SOE sector and its current reform trends. It is one of the first comprehensive applications in Africa and provides first, a landscape of SOEs in The Gambia, and then addresses key aspects for assessing SOEs, namely: “Effects on Markets”; “Fiscal Impact”; and “Corporate Governance and Accountability Mechanisms”. The report assessed 12 non-financial SOEs identified as the SOE portfolio.
African trade news
Close Gap to Realize Digital Africa, AfICTA Boss Urges ICT Players (ThisDay)
AfICTA, Mr. Thabo Mashegoane has urged players in the industry body to continue closing the gap that exists between all sectors involved in shaping the Internet and delivering the information society to the realization of digital Africa through knowledge sharing, trade facilitation, and cross-African advocacy. AfICTA in its advocacy for prosperity and enabling environment for businesses in Africa has held nine consecutive Summits in different member nations and from the past experiences and outcomes of the summits, AfICTA continues to close the gap that exists between all sectors that are involved in shaping the Internet and delivering the information society to the realization of digital Africa through knowledge sharing, trade facilitation, and cross-African advocacy.
Transport infrastructure key for AfCFTA success — VP (Dailynews)
The Vice-President Philip Mpango has underscored the need for African countries to team up and engage in implementation of regional transport infrastructure projects, to smoothen trade amongst themselves through the African Continental Free Trade Area (AfCFTA) arrangement.
Kenyan manufactures, creatives urged to seize opportunities in AfCFTA hackathon (Capital FM)
Kenyan Small and Medium Enterprises (SMEs)/startups have been urged to participate in the African Continental Free Trade Area (AfCFTA) hackathon designed for Manufacturers and creatives in the branding industry.
Mombasa Port on course to becoming Africa’s trade hub (Business Daily)
As frontier markets in Africa develop, ports are increasingly playing a pivotal role. Industries and e-commerce platforms all depend on ports. They are the beginning and the end of the supply chains.
“The pandemic has accelerated mega-trends in the maritime sector like digitisation and de-globalisation. Ports are now a focus for regional integration and industrialisation, and can help promote the resilience of regional markets due to the geographical proximity,” said Andre Ciseau, the Secretary-General of Port Management Association of Eastern and Southern Africa (PMAESA), during the Intermodal Africa Conference hosted by the Kenya Ports Authority (KPA) in Mombasa last week.
The Africa Free Continental Trade Area (AfCFTA) is gaining traction and there will be a significant increase in traffic flows on all transport modes. Thus, with all the expansion plans at the Mombasa Port, it can readily market itself as a critical maritime node for the Eastern and Southern Africa region.
REVENUE-SHARING OP-ED: Century-old Southern African Customs Union is in dire need of a major overhaul (Daily Maverick)
The Covid-19 pandemic has been devastating for South Africa and its near neighbours. As well as the many personal tragedies, no region on the continent has been as badly affected in economic terms.
The latest round of budget speeches has finally shifted attention from crisis management to “rebuilding”, but there is one topic on which all are surprisingly silent: the reform of the Southern African Customs Union (SACU). From South Africa’s perspective, the customs union, which is more than a century old, is expensive to sustain under the current configuration. The remaining member states – Botswana, Eswatini, Lesotho and Namibia – could also benefit from a less-volatile SACU payment.
Poor, congested roads erect more hurdles on cargo routes from ports (The East African)
At the 26th Intermodal Africa Exhibition and Conference in Mombasa this past week, KPA acting managing director John Mwangemi said they expect the port in Lamu to pick up after an improvement of infrastructure. Tanzania Ports Authority (TPA) Director-General Eric Hamissi says some of the funds have been invested in a new online information system that will be accessible to government agencies involved in processing cargo through the ports of Dar es Salaam, Tanga and Mtwara.
Africa’s city dwellers enjoy better livelihoods, higher quality of life, according to a new report (AfDB)
Despite growing rapidly, Africa’s cities have provided improved access to services, jobs and infrastructure for millions of people in the last 30 years compared to smaller communities, a new report finds. “African cities have maintained their economic performance despite growing by 500 million people over the last 30 years, providing several hundred millions with better jobs and improved access to better jobs and infrastructure, this in a context of very limited public support and investment.”
While previous studies have focused on trade finance supply, numerous questions remain unanswered on trade finance demand by firms in Africa; including but not limited to, the value of trade lost by firms due to lack of access to finance, the choice of trade finance instruments, challenges firms face in managing trade finance, and why some firms are discouraged from applying for trade finance. The report is the most comprehensive study combining demand- and supply-side data to understand the trade finance market in Africa .
Climate change: West African countries mark $294 billion to meet challenge (Down to Earth Magazine)
The leaders of the Economic Community of West African States (ECOWAS), a regional, political and economic union of west African countries, recently agreed to spend $294 billion over the next 10 years to fight against climate change. The commitment was part of a Regional Climate Strategy (RCS) to set regional mitigation and adaptation targets for 2030, with a review planned for 2050, according to a statement by ECOWAS.
Address digital gender gap, minister tells stakeholders (Dailynews)
Minister for Community Development, Gender, Women and Special Groups Dr Dorothy Gwajima has called on stakeholders to collaborate with the government to raise awareness about cultural barriers that prevent women and girls from gaining access to technology. She said despite several initiatives, a significant digital gender gap remains, limiting the equitable realization of the benefits of digital
Members of the Africa High-Level Working Group on the Global Financial Architecture (the Group) coordinated by United Nations Economic Commission for Africa (UNECA) and comprising African Ministers of Finance, Planning and Economic Development, the IMF, the World Bank and key African stakeholders – African Development Bank, African Union, Afreximbank – met during the 2022 Spring meetings in Washington, DC to discuss Africa’s urgent financial needs amid the war in Ukraine.
Out of Africa: Rich Continent, Poor People (Inter Press Service)
Capital flight from the global South is immense, with widespread adverse effects. A new book proposes measures to curb, even reverse capital flight from Africa. It also offers pragmatic lessons for many developing countries.
SSA currently loses US$65 billion annually – more than yearly official development assistance (ODA) inflows. The book’s studies carefully investigate natural resource exploitation – of South African minerals, Ivorian cocoa, and Angolan oil and diamonds.
Such forensic country analyses are crucial to more effectively check capital flight. Outflows since the 1980s from the three countries have been massive: US$103 billion from Angola, US$55 billion from Cote d’Ivoire, and US$329 billion from South Africa in 2018 dollars.
‘Time for businesses in Africa to harness global trade growth opportunities’ (BusinessGhana)
The recovery of global trade will depend on the extent to which businesses harness existing business opportunities to boost their operations, Chief Executive Officer (CEO) of First National Bank, Dominic Adu, has said. He said the growth opportunities that the COVID-19 had brought were closer than businesses “think and might be closer to their doorstep.”
Mr Adu said COVID-19 undoubtedly had put the brakes on trade all over the world, and Africa wasn’t insulated from this pandemic-driven fallout. “But much of the world is now on track towards recovering from the economic impacts of the virus, which means it’s time for businesses to shake off the difficulties and constraints that understandably became the norm in 2020 and 2021, and make the decision to take back their success,” he said.
“The quickest way to address the trade challenges in Africa is to ensure we are serious about building our intra Africa trade,” he explained, “and that includes locating or creating trade opportunities across the continent, getting involved in forums and organisations that have a mandate to prompt investment and policy reforms by African governments, and making sure that discussions about intra-Africa trade are standing items on the agendas of every company board meeting.”
Press Briefing Regional Economic Outlook Sub- Saharan Africa (IMF)
But this year, a slower global recovery and a less benign outlook for commodity importers will mean that growth will shrink to 3.8 percent. Further, as always, these aggregate numbers of course masks significant differences amongst countries. Projected growth for oil exporters in 2022 has been revised up by about point eight percentage points, while growth for oil importers has been revised down by 0.4 percentage points. And among oil importers, downgrades are particularly pronounced for the most fragile economies. Looking ahead, we only expect growth to pick up to around 4 percent in 2023, or about 1.7 percent in per capita terms. While you know this is welcome, it is still not enough to help countries make ground – a lot of the lost ground from the effects of the pandemic. It also makes the task of creating jobs, fighting climate change, and achieving the sustainable development goals that much harder to achieve. Indeed, per capita incomes are expected to remain 4½ percent below pre pandemic projections.
ECA’s Conference of Ministers (CoM2022) set to explore options for financing Africa’s recovery (UNECA)
African ministers in charge of finance, planning and economic development, as well as leading figures from the private and public sectors will participate in the 54th session of the ECA Conference of Ministers (CoM2022) from the 11th to the 17th of May 2022. The hybrid event will be jointly hosted in Dakar, Senegal, by the Economic Commission for Africa and the government of Senegal on the theme “Financing Africa’s Recovery: Breaking New Ground.”
The programme will include high level ministerial panels and round table discussions on how to transform the continued threat of the COVD-19 pandemic into an accelerator of growth and global prosperity. CoM2022 will also feature the launch of ECA’s annual flagship Economic Report on Africa.
Commitment To African Medicines Agency Needs More Than Words (Africa.com)
These harmonisation efforts will further improve trade in support of the African Continental Free Trade Area (AfCFTA), by deepening African integration and enabling the development of markets for health commodities and technologies?
EU to turn to Africa to wean itself off Russian natural gas: report (Business Insider)
In the draft strategy document, the European Commission said it planned to boost imports of liquefied natural gas by 50 billion cubic meters and pipeline gas from countries other than Russia by 10 billion cubic meters, per Bloomberg. The European Union is planning to turn to Africa to help wean itself off Russian natural gas, Bloomberg reported, citing a draft document detailing the trade bloc’s energy strategy.
Trading aims: The value of Africa’s deep integration trade agreement (European Council on Foreign Relations)
In this context, EU policymakers should view the recent creation of an Africa-wide market under the African Continental Free Trade Area (AfCFTA) as an opportunity to consolidate and strengthen commercial and geopolitical ties with Africa.
Online shopping bonanza to foster Sino-Africa trade ties (Capital)
Bringing together 300 e-commerce platforms, over one million traders and product portfolio in excess of 100, 000 brands, the shopping festival is the clearest indication yet of the growing trade and economic ties between Beijing and different African capitals. Powered by technology, the event will grant Chinese consumers real-time interaction with high quality production bases in 23 African countries.
Global economy news
Quad’s outcome document on IP COVID-19 response made public (WTO)
WTO Director-General Ngozi Okonjo-Iweala put forward on 3 May the outcome document that emerged from the informal process conducted with the Quad (the European Union, India, South Africa and the United States) for an intellectual property response to COVID-19.
After an impasse of more than one year in the TRIPS Council, DG Okonjo-Iweala, working with Deputy Director-General Anabel González, supported an informal group of ministers to come together around what could be a meaningful proposal, without prejudice to their respective positions, that could provide a platform to be built upon by the membership.
In their discussions, the Quad adopted a problem-solving approach aimed at identifying practical ways of clarifying, streamlining and simplifying how governments can override patent rights, under certain conditions, to enable diversification of production of COVID-19 vaccines.
WTO, generic drug makers explore cooperation for increased access to therapeutics (WTO)
WTO Director-General Ngozi Okonjo-Iweala and the CEO Advisory Committee of the International Generic and Biosimilar Medicines Association (IGBA) held on 2 May a virtual meeting to discuss how to promote international health equity and access to therapeutics. The meeting marked the initial step towards a continuing dialogue aimed at contributing to the fight against the pandemic and securing global public health beyond the current health crisis.
Unlocking e-commerce in LDCs: Governments hold the key (Trade for Development News)
Our contribution to this process has been to work directly with governments to support the formulation of national e-commerce strategies and policies. This alignment can be achieved through strong relationships within LDC governments and working together with trade ministries to drive their own national e-commerce strategy and regulations.
Non-alignment urgent imperative for Global South (Asia Times)
BRICS (Brazil, Russia, India, China and South Africa) has a bank , and for the 16 nations of the Southern African Development Community (SADC) there is the Development Bank of Southern Africa; yet the reserves of the countries joined to these projects are still kept in the United States or in European capitals.
The world of finance is waking up to the reality of climate change, but money still isn’t getting to the right places (Trade for Development News)
Ambition was plentiful at last year’s climate conference, but outcomes can best be described as mixed when it comes to climate finance. While some eye-catching pledges made headlines, for the majority of the world where climate change impacts are a constant reality, these can still feel far-removed, not to mention entirely inadequate in scale against the estimated $60-90 trillion of investment needed over the next 15 years.
Trade is a critical part of on the ground adaptation efforts that must also be considered, specifically local trade amongst small and medium enterprises which are impacted head-on by climate emergencies. We are seeing communities already vulnerable to shocks affected not only in terms of their resources getting destroyed or depleted but also due to a lack of support systems when this happens. There is an added dimension to this, in which we are now moving into a phase where disasters happening in one part of the world have a ripple effect, impacting global supply chains.
New Data: Private Sector Investment in Developing-Country Infrastructure Bounces Back from Historic Lows (World Bank)
New data from the World Bank finds that private investment in low- and middle-income country infrastructure is rebounding from the historic lows recorded in 2020. Private investment commitments in low- and middle-income countries totaled $76.2 billion in 2021, representing a 49% increase from 2020.
“The rebound of private sector investment commitments in infrastructure is a positive sign that the recovery from COVID19 had begun in 2021,” said Imad Fakhoury, the World Bank’s Global Director for Infrastructure Finance, PPPs & Guarantees. “There is a significant opportunity to forge ahead with quality investments in green, resilient and inclusive infrastructure in 2022. But as economic stimulus slows, credit conditions tighten and uncertainty from overlapping crises intensifies, there will be even greater need for private investment in infrastructure. This will require working collectively to enable private sector solutions and putting in place stronger foundations for a post-crises recovery.”
Rich nations scramble to seal coal transition deals before COP27 (Engineering News)
As they prepare for the next round of global climate talks in November, officials from rich countries are trying to pull together a series of multibillion-dollar packages to help poor countries phase out coal. But negotiations have been snarled by national politics and Russia’s war in Ukraine, which has made the dirtiest fossil fuel a lucrative commodity to mine and export, according to people familiar with the talks who asked not to be identified because the discussions are private.
5 global actions needed to build a sustainable ocean economy (UNCTAD)
A summary by the forum’s chair sets out how countries can use trade to protect the ocean, while boosting the local economy and creating jobs, in line with Sustainable Development Goal 14. The fourth edition of the UN Oceans Forum, organized by an UNCTAD-led coalition from 6 to 8 April, called for sufficient and reliable long-term investment in a Blue Deal to conserve and sustainably use the ocean for sustainable development.
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Date of production restart still unsure – Toyota SA boss (Engineering News)
Toyota South Africa Motors (TSAM) says it is following a “systematic and meticulously phased plan” to restart production at its Prospecton assembly plant, south of Durban, after the facility suffered extensive flood damage two weeks ago. TSAM says the approach is designed to ensure a safe start-up, without any potential secondary issues.
The first three phases in the return-to-production plan include the establishment of temporary utilities at the plant, cleaning up and then powering up the machinery. Once the trial power-up stage is reached, certain areas of the facility will be able to move to phase four, which involves “an accurate assessment and equipment check”. On the sales front, TSAM senior VP Leon Theron confirms that while delivery of locally built models will be impacted in the short term, plans have been put into place to prioritise existing orders.
SA-Guinea Bissau work to deepen trade (SAnews)
Trade and investment relationships between South Africa and Guinea Bissau are being deepened, says President Cyril Ramaphosa. “Greater economic prosperity should underpin everything that we do and this is what we intend to focus on as we deepen our relations between our two countries. Our goal for this State Visit has been to deepen trade and investment between South Africa and Guinea Bissau,” said the President.
Kenya eyes $244m budget support from IMF (The East African)
The International Monetary Fund (IMF) plans to release $244 million to Kenya to finance its budget “in the coming weeks” after its staff expressed their satisfaction with Nairobi’s economic reforms in the face of Covid-19. The IMF said its staff are satisfied with the progress that the Kenyan government is making in its economic reform programmes, and the deal now awaits endorsement by the Fund’s management and board. Kenya will access $244 million, bringing the total IMF support in a 38-month financing facility to $1.17 billion under the Extended Fund Facility (EFF) and Extended Credit facility (ECF).
Manufacturers task FG to fasten AfCFTA implementation, tackle FX supply issues (Nairametrics)
Manufacturers Association of Nigeria has called on the Federal Government to fasten the implementation of the African Continental Free Trade Area (AfCFTA) to boost its industrialisation goals. It also called on the FG to tackle Nigeria’s electricity and interest rate issues to take advantage of tariff-free African trade. This was disclosed by Mr Mansur Ahmed, President of MAN at the 11th Business Luncheon of the Apapa Branch Council of MAN on Thursday in Lagos, themed: “Improving Nigeria’s Manufacturers Competitiveness Within the Context of AFCFTA’s Implementation.” The Nigerian National Action Committee on the AfCFTA has already said that its strategic objective is to capture 10% of Africa’s imports by 2035, thereby doubling Nigeria’s export in the process.
What reopening of Idi Iroko, Jibiya borders means for Nigerian economy (TheCable)
On Friday, the Nigeria Customs Service (NCS) announced the reopening of four more land borders comprising Idiroko in Ogun, Jibiya in Katsina, Kamba in Kebbi and Ikom in Cross River. An open border enables the free movement of people (and often of goods) between jurisdictions with no restrictions on movement and lacks significant border control.
In August 2019, Nigeria’s land borders were closed over the rapid increase of illegal importation of drugs, small arms and agricultural products into Nigeria from neighbouring West African countries.
The move, in the wake of the African Continental Free Trade Pact, halted trade relations between Nigeria and neighbouring countries, including Chad, Cameroon, Niger and Benin.
In December 2020, President Muhammadu Buhari ordered the reopening of borders in Seme in Lagos, Illela in Sokoto, Maigatari in Jigawa, and Mfum in Cross River, citing recommendations from a presidential committee on review and advice on the reopening of borders. The other borders were later impacted by coronavirus lockdowns.
Egypt to boost local wheat production to cut on imports (CGTN Africa)
The annual wheat harvest season has begun in Egypt. The harvest this year in the North African country, is particularly significant due to the threats posed by the Russia-Ukraine crisis impacting supplies.
Egypt is the largest wheat importer in the world. It received 12.9 million tons in 2020 out of about 15.5 million tons of annual consumption. 80 percent of its wheat supply comes from Russia and Ukraine. But the ongoing conflict in Ukraine has caused a shortage in supply and doubled the prices of wheat globally. In response, the Egyptian government is accelerating efforts to diversify its sources of wheat.
“The strategy by the state is based on two dimensions. The first is a horizontal expansion that aims at increasing wheat cultivation in empty lands, without replacing other crops. The second dimension involves upscaling efforts to increase yield from the same area of land by using new high-quality and high-producing seeds that we are developing here,” Mostafa says. “So we will increase local production and reduce the import of seeds. We also introduce modern irrigation systems that save water consumption by nearly 40 percent for the farmers.”
Niger Country Economic Memorandum: Pathways to Sustainable Growth (World Bank)
Over the past two decades, Niger’s economic growth has been robust, around 5.2 %, placing the country among the region’s growing economies. However, the country’s economy has remained fundamentally the same during this period: undiversified, fragile, and highly vulnerable to shocks.
The level of GDP per capita increased by 30%, reflecting an estimated 2% annual growth rate in productivity gains per person employed over the period. However, due to rapid population growth, the number of poor people has increased.
To achieve a more inclusive development trajectory, Niger would benefit from strengthening institutional capacity and fostering political cohesion to agree on, adopt, and implement broad-based economic and social reforms.
The Niger Economic Memorandum identifies three priority areas for creating the conditions for economic emergence: the use of technology to accelerate private sector development; the development and proper management of extractive industries; and the establishment of financial and risk management frameworks for crises and natural disasters.
Somalia encourages foreign investments to fix its energy crisis (TRT World)
Somalia is on the move. It is pushing for foreign investment, and large infrastructure projects are changing the face of its scarred capital city, Mogadishu. These developments could promise better fortunes for Somalis as the country emerges from the Covid-19 pandemic. However, the scale and speed of this transformation could be even more pronounced should a few sticking points receive adequate attention. Besides ongoing security reforms, tackling the country’s energy challenges could have a positive spillover in almost all sectors of the economy. Like many African countries, Somalia grapples with inadequate energy supply, high power tariffs and poor access, a mix that has erected barriers to social and economic progress. At the heart of this energy challenge is a lack of diversification.
African trade news
Innovation-focused Fintechs will help boost intra-African trade – Hubtel official (News Ghana)
Head of Product Management at leading fintech company Hubtel, Patrick Asare-Frimpong has said that “the way to increase intra-Africa trade is to provide enough tools to enable fintechs to innovate around all the protocols on the Pan-African Payments and Settlements System (PAPPS). He said the absence of such access tools will not encourage fintechs to innovate and that will work against the continental drive to boost intra-Africa trade. Patrick Asare-Frimpong was speaking at this year’s edition of The Money Summit powered by Business and Financial Times. The Pan African Payments and Settlement System (PAPPS) is the intra-African trade and commerce payments, centralized payment and settlement system. With the participation of banks and fintechs, the deployment of this system is expected to contribute to solving the menace of low intra-African Trade. PAPSS, hailed as a game-changer for intra-African Trade, is expected to be the most important component of the African Continental Free Trade Area (AfCFTA) because it promises to save businesses across the continent US$5 billion in transaction costs each year, with trade between African countries expected to increase by 22 percent by 2040, generating an additional US$70 billion in value. However, some challenges need to be addresses.
AfDB supports African Union’s implementation of Agenda 2063 (African Review)
The African Development Bank has signed a protocol of agreement with the African Union to support reforms that will bolster the pan-African organisation’s implementation of Agenda 2063
The project is expected to bolster the AU’s efforts to implement Agenda 2063. Adopted in 2015, Agenda 2063 is the African Union’s vision for an integrated, prosperous, and peaceful Africa driven by its own citizens and representing a dynamic force in the global arena. The project cost, amounting to US$11.48mn, is being supported with a grant from the Bank Group’s concessional financing window. It was approved by the board of directors in February 2022. The signing of the protocol of agreement signals the start of the implementation phase of the project.
Built for Africa, in Africa (African Review)
In the latest issue of African Review, Mike Whitfield, chairman of Nissan Africa South and managing director Nissan Egypt at Nissan Motor Corporation, discusses the company’s African development following the opening of a new assembly plant in Ghana
Commenting on the advantages the plant will bring to the country, Whitfield said, “The benefit of the plant to Ghana is incalculable, because it is key to the reindustrialisation and diversification of the country’s economy. If we look at South Africa as an example, the automotive manufacturing industry today employs 470,000 people and three times more in the value chain. It contributed 7.1% to the GDP in 2019 and earned US$14.3bn through exports. But that was done over 60 years.”
“The bigger picture involves using the African Continental Free Trade Agreement (AfCFTA) to begin producing vehicles across Africa in what the World Bank believes could increase the combined GDP of the continent by US$450bn by 2035 if it is effectively implemented, lifting 100 million people out of poverty. The automotive plan for Africa involves creating regional manufacturing hubs to begin trading regionally before expanding, and the investment in this plant looks to help Ghana tap into that potential.”
Importers trim use of Mombasa port as Kenyan polls approach (The Star, Kenya)
Traders in landlocked East African countries are slowing down on the use of the Mombasa port as the August elections approach, latest trends show. In the last one month, Dar es Salaam port has seen a spike on imports and exports, leading to a congestion at the port. Traders in the region are using Dar es Salaam more as Kenya campaigns in Kenya heat up ahead of the elections.
The EAC region is served by two major corridors with the main one being the 1,700 kilometre long Northern Corridor that runs between Kenya, Uganda Rwanda, Burundi and Eastern D.R. Congo. The two corridors facilitate export and import activities within the EAC region with a combination of rail, road and lake transportation networks.
IMF urges Nigeria, other oil-exporting countries to build buffers (Businessday)
Rallying oil prices on the back of the Russia-Ukraine war has presented great opportunities for Nigeria and other oil-exporting countries, particularly in sub-Saharan Africa (SSA), to build buffers that could shield them from further economic shocks, the International Monetary Fund (IMF) advised on Thursday. The IMF is particularly worried that the promising recovery in the region has been disrupted by the war in Ukraine which has exacerbated the already bad fiscal conditions created by the COVID-19 pandemic, leaving no room for manoeuvre. Economic recovery in the region picked up in the third quarter of 2021 and held up despite the onset of a fourth COVID-19 wave at the end of the year. Estimated growth in 2021 has been revised upward from 3.7 to 4.5percent. But this progress has been offset by recent events, especially the Russian invasion of Ukraine which triggered a sharp rise in commodity prices—straining the fiscal and external balances of commodity-importing countries and increasing food-security concerns across the region.
African states urged to coordinate intermodal transport systems (The Star, Kenya)
The lack of an efficient and integrated transport network in Africa means that the continent is missing out on a big opportunity to exchange goods and services freely. National Treasury CS Ukur Yatani has said with a population of 1.4 billion people as of April 2022, representing 16.72 per cent of the world population, Africa provides a large market for intra-Africa trading, but it is still largely uncoordinated and untapped. The CS lamented the paltry three per cent of the global exports and imports that Africa contributes to goods and services. This, he said, is a wakeup call for Africa to improve its intermodal transport systems so as to promote the manufacturing sector, strengthen the export promotion councils, and open up special economic zones for value addition processes for export markets
Ramaphosa stresses urgency of African countries cooperating to manufacture Covid-19 vaccines (Engineering News)
President Cyril Ramaphosa on Thursday explained that it was urgent that African countries cooperate to manufacture their own vaccines, and strengthen their own health systems so that these vaccines reach the people who need them most. Ramaphosa was speaking during the official talks on the occasion of a State visit by Guinea-Bissau President His Excellency General Umaro Sissoco Embaló. “We have the arduos task of rebuilding our societies, in which so many lives have been lost, and our national economies, which have suffered great damage. Africa’s recovery depends on more of our people getting vaccinated against Covid-19,” he said. He explained that it was a cause for great concern that the global community had not sustained the principle of solidarity and cooperation when it came to equitable access to vaccines. He said a renewed momentum must be given to the process of implementing the agreements that exist between South Africa and Guinea-Bissau, saying this should form part of the country’s efforts to implement the Africa Continental Free Trade Area agreement.
Building Capacity for Digitally Enabled Trading System (COMESA)
Implementing digital trade facilitation reforms have positive impacts on intra-COMESA exports. It is estimated that an increase of 10 percent in the adoption of digital trade technologies would result in a 5.5 percent increase in intra-COMESA exports. The regional organization is therefore scaling-up the Free Trade Area (FTA) to a Digital Free Trade Area (DFTA), to empower traders to apply ICT tools particularly on cross border trade. This will not only enhance efficiency but also cut costs and minimize physical-related barriers to trade. Pursuant to this objective, COMESA and the Commonwealth Secretariat partnered to host a training on digital trade on 25 – 27 April 2022 to build the necessary capacity within the region on how thrive in a fully digitally enabled trading system. The training targeted policy makers, trade officials and technocrats as well as legal reform officers involved in the digital trade process.
Coming Soon: A Regional Blue Economy Strategy (COMESA)
COMESA has developed a draft strategy to harness the benefits of the Blue Economy for its 21 Member States. The draft strategy was presented to delegates from the Members States on 26-27 April 2022 in Lusaka, Zambia, where it was reviewed and validated. The concept of the Blue Economy has been embraced by the COMESA Member States as a mechanism to realize sustainable ocean-based economic development. Currently, there is limited information on the Blue Economy as the focus has been primarily on land-based economic development or on conservation rather than on the sustainable use of the investment in an ocean-based economy, for national benefit. “An integrated approach to ocean-based and inland water development, which brings together economy, environment and society is crucial,” said the COMESA Assistant Secretary General, Dr Kipyego Cheluget when he addressed the delegates.
World Bank Scales-up Funding COMESA Programmes (COMESA)
The current portfolio of World Bank supported projects in the COMESA region is close to five billion dollars and set to rise as other programmes are set to come on board. The largest project is the Regional Infrastructure Finance Facility (RIFF) of US$ 425 million whose objective is to promote access to long-term finance and improve the enabling environment for investment in infrastructure. The bulk of this funding is under the Trade Development Bank, a COMESA institution. The review of the ongoing programmes and discussion on new areas of collaboration formed part of the agenda of a virtual bilateral meeting between COMESA and the World Bank Group (WBG) Tuesday, April 26, 2022. It was led by the World Bank Regional Director for Africa and the Middle East Dr. Bouthenia Guermazi and COMESA Secretary General, Chileshe Kapwepwe. COMESA SG highlighted key areas where the Bank’s support would be crucial including the implementation of smart border initiative, which leverage on technology to improve efficiency at border points. The other is the scaling up of climate smart agriculture focusing on small scale growers to link them to market.
Global economy news
G20 debt relief talks should take three months, says IMF Africa head (Engineering News)
Debt restructuring talks between creditor countries should take three months, the head of the IMF’s Africa Department told Reuters, amid criticisms of the slow speed of negotiations and calls for China to show leadership in tackling debt issues. South Africa has offered to co-chair Zambia’s creditor committee, following China’s pledge to do so at IMF meetings last week, but Zambia’s debt sustainability analysis has yet to be finalized, Abebe Aemro Selassie said in an interview.
Adesina lays out steps for a collective global path on infrastructure financing (AfDB)
US Treasury Secretary Janet Yellen hosted G-7 Ministers and heads of multilateral development banks on Tuesday. The high-level virtual roundtable event to discuss scaling up of infrastructure financing—organized in the context of President Biden’s Building Back a Better World plan—was moderated by US Assistant Secretary for International Trade and Development Alexia Latortue. Speaking at the virtual roundtable, African Development Bank Group President Akinwumi Adesina commended Secretary Yellen and the Biden Administration for mobilizing development resources to expand infrastructure financing, which he said was critical for Africa and other parts of the developing world.
UNDP and partners announce Integrated National Financing Framework Facility (Devdiscourse)
The United Nations Development Programme (UNDP), the United Nations Department of Economic and Social Affairs (UN DESA), the Organisation for Economic Co-operation and Development (OECD), the European Union (EU) and the Governments of Italy and Sweden announced a new joint flagship initiative - the Integrated National Financing Framework (INFF) Facility. The Facility will bring together international partners to align and magnify support to more than 80 countries to channel critical investment to the Sustainable Development Goals (SDGs). Countries’ efforts to finance SDGs must respond to an exceedingly challenging global environment. The UN’s Inter-Agency Task Force on Financing for Development warns of a deepening finance divide that is driving uneven recovery from Covid-19 in the latest Financing for Sustainable Development Report, launched last week. For one in five developing countries, GDP per capita was projected to remain below 2019 levels through the end of 2023, even before the impacts of the war in Ukraine were felt. About 60 per cent of Least Developed Countries and other low-income countries are at high risk of or in debt distress. “Although there is enough money in the world to finance the SDGs, it is not allocated in the right places and amounts -- just 20% of global capital is held in developing countries, which are home to 84% of the world’s population,” said Achim Steiner, UNDP Administrator. “To bridge this gap, this new INFF Facility will provide countries with the technology, expertise, and tools they need to implement ambitious financing strategies that will unlock game-changing levels of finance -- allowing countries to take decisive climate action and make future-orientated investments in key areas like nature, literacy, healthcare and sanitation.”
New partnership forged to make the digital economy work for all (UNCTAD)
A new strategic partnership between the International Chamber of Commerce (ICC) and the eTrade for all initiative seeks to strengthen efforts towards more inclusive development outcomes from the digital economy. The partnership was announced on 25 April during the UNCTAD eCommerce Week held in Geneva and online, following a vetting process among the initiative’s 34 members.
The eTrade for all initiative serves as a global helpdesk for developing countries to bridge the knowledge gap on e-commerce. It provides access to information and resources, promotes inclusive dialogues on e-commerce and the digital economy and catalyses partnerships.
It will enable consistent, systematic and strategic engagement of micro, small and medium-sized enterprises (MSMEs) across all sectors, which are affected by the increased digitalization of economies in developing and developed countries.
UNCTAD partners with DHL to empower women in e-commerce (UNCTAD)
UNCTAD’s eTrade for Women initiative has joined forces with Deutsche Post DHL Group, a leading player in international logistics, to help women overcome some of the barriers to global digital trade. According to a recent UNCTAD study, inadequate access to reliable and affordable trade logistics is among the top challenges many e-commerce businesses face in developing countries. Such obstacles often affect more women business owners than their male counterparts as they also tend to have less access to knowledge, funding and support.
WTO launches new database compiling over 100 studies on gender equality in trade (WTO)
The new WTO Research Database on Trade and Gender, launched on 29 April, brings together more than 100 studies on how to make trade work for women, providing support for WTO members’ efforts to integrate gender issues into trade policies and agreements. The database will be regularly updated as researchers submit more published papers.
Members discuss improving data collection on trade in essential goods to fight COVID-19 (WTO)
The experience-sharing session followed on from the first session held on 4 March 2022, which addressed two main topics: the definition of lists of essential goods to fight the pandemic and challenges related to tariff classification. Both sessions were well attended by Geneva and capital-based officials, signalling that experience sharing should remain high on the work programme of the Committee.
In the second session, China, the European Union, Thailand, the United Kingdom and India reported on how they have organized their national statistical systems to monitor and measure trade in essential goods to combat COVID-19 since the beginning of the pandemic — for example, by including new tariff codes or statistical breakouts or by relying on other methods. Members also shared the problems faced in data monitoring and collection and how they were addressed.
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The Deputy Minister of Trade, Industry and Competition, Mr Fikile Majola, says new export opportunities that are emerging from the disruption in the global supply chains caused mainly by Covid-19 need to be fully utilised by South African businesses and other investment partners. He was addressing a sod-turning event, to launch a carbon black production site at the Coega Special Economic Zone (SEZ) in Gqeberha
OEC is the only local producer of a wide range of carbon blacks. The product is used in various industries, such as tyre industry, ink, coatings, batteries, plastics, and other high performance applications. Key interventions had to be made by the stakeholders involved to save the project from risk of failure as it was put at risk by a decision of the Port of Port Elizabeth (PoPE) to close to liquid vessels by end of December 2022.
Transnet National Ports Authority (TNPA) then took a decision to relocate the liquid fuel storage to the Coega SEZ and the Department of Trade, Industry and Competition (the dtic) injected funding to the value of R202 million to make the carbon black project possible. The funding has made possible the development of two 18 000 cubic metre tanks for storage of carbon black feedstock with ancilliary infrastructure within Zone 7 of the Coega SEZ.
“The manufacturing sector contributes about 14% to the GDP and therefore this project will play a fair share in contributing to the country’s manufacturing and export sectors. Furthermore, the fact that the construction of the storage facility and associated infrastructure will enable the creation of approximately 150 additional jobs (50-construction phase, and 100 jobs during the operational phase of the project) is highly appreciated. This is proof that coordinated efforts across the different spheres of government and the private sector can effectively realise the investment pipelines required,” Majola said.
Voting on EU measures for Southern African citrus postponed (Fruitnet)
This week’s expected vote by the European Union’s (EU) Standing Committee on Plant, Animal, Food and Feed (SCOPAFF) on new measures for Southern African citrus did not take place as originally planned. In what was a rather confusing run-up to the vote, it appears that SCOPAFF decided that more consultation was needed, delaying the vote until next month. South African sources admitted that they were informed on Friday that the upcoming legislation on the FCM measures for citrus that were to be discussed and voted on Monday and Tuesday this week had been withdrawn. Instead, South Africa continued its intense lobbying until they received final confirmation.
Shippers’ Authority, FDA move to tackle non-tariff barriers impeding trade facilitation (Myjoyonline)
As part of measures to improve processing of documents at the port, the Ghana Shippers’ Authority (GSA) has partnered the Food and Drugs Authority (FDA) to sensitise shippers on ways to address import permit application challenges. The move is part of efforts to tackle the growing Non-Tariff Barriers (NTBs) as well as support trade facilitation. At the sensitisation forum organised under theme ‘The Role of FDA – Addressing Import Permit Application Challenges to Facilitate Trade’ held at the FDA office in Tema on Wednesday, April 27, 2022, the Tema Branch Manager of the GSA, Charles Darling Sey said, more efforts would be put in to deal with the development as a means to support the Africa Continental Free Trade Agreement (AfCFTA) which frowns on NTBs. He noted that a United Nations Conference on Trade and Development report suggests that African countries could gain US$ 20 billion in GDP growth by tackling NTBs at the continental level.
Why we closed land borders for 2 years – Buhari (Vanguard)
PRESIDENT Muhammadu Buhari said yesterday that his government shut the nation’s borders to protect farmers. Buhari spoke as President of Africa Development Bank, AfDB, Dr Akinwumi Adesina, disclosed that the bank has earmarked $1.5 billion Africa Emergency Food Plan to cushion the effect of Russia/Ukraine conflict expected to trigger global food crisis. The President, who spoke at a meeting with the AfDB boss in his office in the Presidential Villa, Abuja, explained that much had been achieved in encouraging local farmers since the land borders were closed two years ago. He, however, lauded the AfDB for planning ahead of whatever negative consequences might come from the Russia-Ukraine conflict in terms of food security.
Reopening of borders booster for manufacturing, trade, says OPS (Businessday)
Members of the organised private sector (OPS) have described the Federal Government’s full reopening of Nigeria’s major international land borders as timely, saying it would allow businesses to access more markets, source raw materials easily and explore options for expansion.
Frank Onyebu, chairman, Apapa branch of MAN, told BusinessDay that Nigeria has robust borders which offer opportunities for larger markets and expansion for businesses in the manufacturing sector, but these opportunities are being snatched away by smuggling and dumping of low-quality goods. “The reopening gives room for manufacturers to explore other markets, expand their businesses and even diversify their portfolio, in addition to this, the manufacturing sector is at the brink of collapse as stakeholders deal with rising production costs, FX shortages, supply cuts, tax burdens, among other issues, this will serve as a relief in this trying period,” he said. Onyebu noted that the borders should not have been closed in the first place if it was properly secured from the activities of smugglers and other illegal businesses, adding that following this reopening, those manning the borders need to be more effective and efficient in carrying out their activities.
Seventh ministerial meeting of the United Kingdom - Nigeria Economic Development Forum (EDF) (GOV.UK)
On 26 April 2022, the Minister for Trade Policy of the United Kingdom, the Minister of Industry, Trade and Investment of Nigeria and the Minister of State Finance, Budget and National Planning of Nigeria, held in person the 7th Ministerial meeting of the United Kingdom-Nigeria Economic Development Forum (EDF).
Both sides restated the commitment to enhancing the relationship between Nigeria and the UK and understand that a deep trade policy relationship is in the interest of both countries; because of this, and ahead of the current EDF Memorandum of Understanding (MoU) coming to a close in 2023, ministers agreed to establish an official level working group to explore the benefits of a future UK-Nigeria enhanced trade partnership. Both Nigeria and the UK agreed that such a partnership between their two countries should help encourage economic growth, job creation and greater two-way trade and investment, helping to support Nigerian and British businesses. Both the UK and Nigeria agreed to set out priority sectors they would like the working group to consider and to give feedback at EDF8. Nigeria requested that the enhanced trade partnership working group should consider discussing mutual recognition agreements for standards and professional services.
UK representatives confirmed that the UK will set out details of its new trade preference scheme, the Developing Countries Trading Scheme (DCTS), later in 2022 and appreciated the Nigerian input into the UK’s public consultation on the DCTS.
E-Tax Rollout in Ethiopia — A Challenging Road to Renaissance (Bloomberg)
Ethiopia has historically been part of the experimental deployment of electronic tax systems in Africa to provide international funders and regional tax cooperation organizations with proof of reduction of tax evasion and increase in tax payments. The challenge was tremendous in a country used to poor internet, a low level of taxpayer computer literacy, lack of a skilled workforce, and poor coordination between revenue authorities. With a 770-strong large taxpayer base in 2019, Ethiopia has been able to quickly mobilize tax revenues at a higher level than previously, allowing the country to set an ambitious new budget for the future.
Africa is part of the global move to adopt and integrate digital tools to improve processes and services with the aim of raising more revenue and reducing compliance costs.
The Africa Tax Administration Forum in June 2021 published a survey report that highlighted seven capacity blocks that will support African tax administrations in ICT. These seven blocks are a comprehensive approach providing tools to African tax administrations to improve processes and reduce compliance costs. ICT provides the benefit of better supporting taxpayers and increasing compliance, allowing remote working and online taxpayer contact.
Gabon launches new economic zone (African Business)
The Gabonese government has announced the construction of a new special economic zone (SEZ), the Mpassa-Lebombi, in the south-eastern province of Haut-Ogooué. The new zone aims at attracting investment in the agricultural and forestry sectors, which respectively represented $61m and $537m of export value in 2020. The new SEZ will, like the country’s two existing zones, be a joint venture between the Gabonese government and the Singaporean commodity trading firm Olam International, which acts as the principal shareholder (40.5%).
The Mpassa-Lebombi SEZ will be developed and modelled after Gabon’s first SEZ, Nkok, created in 2011, which now employs 4000 people, of which 80% are Gabonese. Nkok accounts for nearly 40% of the country’s exports. As a condition of setting up in its special economic zones, the government makes firm commit to exporting at least three-quarters of their production. In return, the zones provide tax exemptions, efficient infrastructure and access to the country’s resources.
Liberia: National Port Authority Signs MOU with Georgia Ports Authority for the Advancement of Trade (FrontPageAfrica)
The National Port Authority (NPA) has signed a memorandum of understanding with the Georgia Ports Authority (GPA) to renew commitments between the two sisterly cities for the advancement and the promotion of trade. The signing of the MOU was preceded by a round table discussion that touched on a host of other things that seek toward the advancement and the promotion of trade between the two sisterly ports authorities.
Speaking at the event, the Managing Director of the National Port Authority Bill Twehway was pleased to have a delegate from Georgia Ports Authority to sign what he terms as a historical document.
The MOU he says is a non-legally banding one. This, Mr. Twehway says, is to strengthen the National Port Authority and that of the Georgia Ports Authority.
Central African Republic adopts Bitcoin as official currency (Africa Times)
The Central African Republic has become the first nation in Africa to adopt Bitcoin as an official currency, saying the move will put the C.A.R. “on the map of the most courageous and visionary countries in the world.” President Faustin-Archange Touadéra announced the decision in a statement, welcoming the news following the National Assembly’s approval of a bill that established the legal and regulatory framework for using cryptocurrencies. He praised the ruling as a “decisive step” towards creating opportunity and advancing his economic agenda. “We are going on a new path that will mark a milestone for our country,” the announcement said. “In a progressive forward-looking vision, our nation must be able to pursue its destiny and to join the ranks of those who not only fully understand the importance of blockchain technology, but who are also rushing to legislate it.” The C.A.R. will continue to use the CFA franc, even as some opposition leaders plan to mount a challenge about the Bitcoin decision.
African trade news
Data of informal trade is key in accurate monitoring of intra-African trade says Karingi of ECA (UNECA)
Official trade statistics often capture formal trade and leave out informal trade, leading to underestimation of intra-African trade, intra-Regional Economic Community (REC) trade and African trade in general. Understanding the scale of informal trade will be instrumental in accurately monitoring intra-African trade, particularly in the context of the AfCFTA. “Since the majority of the informal cross-border traders are women, Informal Cross Border Trade (ICBT) data is key in understanding the different dynamics at play that could inform the development and implementation of gender sensitive trade policies and processes” said Stephen Karingi, Director of the Regional Integration and Trade Division of ECA speaking at the virtual launch of the Phase II ECA and Afreximbank project.
Brian Mureverwi, trade advisor at the African Union Economic Development, Trade, Industry & Mining department, emphasised the need to come up with a concrete methodology that captures ICBT data in order to come up with evidence-based policies. He further added that once the data are captured, it will feed into the African Trade Observatory portal where policy makers will be able to access the information in the comfort of their offices.
Investments into East African startups fall by 50pc as Nigeria shines (The East African)
East Africa’s investments in startups declined by more than 50 percent in 2021, with deal activities falling by two percent, largely due to the impact of new restrictions imposed by governments to tame the spread of the third wave of the Covid-19 pandemic. The latest Venture Capital in Africa report (April 2022) by the African Private Equity and Venture Capital Association (AVCA) shows that the value of funding raised by East African entrepreneurs as a proportion of total deal value in Africa fell by more than half to seven percent ($364 million) in 2021 from 18 percent ($900 million) in the seven-year period (2014-2020) .However, in the continent, the total amount raised by African startups more than quadrupled to $5.2 billion from $1.1 billion in 2020 helped by a surge in venture capital (VC) deal activities in Nigeria.
DRC is a key plank in regional value chain for businesses (The East African)
The official induction of the Democratic Republic of Congo into the East African Community is a watershed moment for regional business owners and investors as it marks the formal rollout of a platform that will stimulate business growth, cooperation, and unlimited investment opportunities. As a fast-expanding regional market with DRC, East African Community now boasts of increased diversity that will no doubt supplement trade with external partners and stakeholders for economic and business prosperity. With the opportunities DRC brings on board, intra-regional trade will steadily rise as businesses expand and set up supply chains across the region.
COMESA Meets Stakeholders at the Zimbabwe Trade Expo (COMESA)
COMESA Secretariat is participating at the 62nd Zimbabwe International Trade Fair (ZITF) which is being held in Bulawayo City from 26 – 30 April 2022. This is part of COMESA’s outreach to raise public and stakeholder awareness on regional integration programmes and encourage them to take advantage of the opportunities that COMESA provides. It is also part of the demonstration of the COMESA programmes in Member States as provided for in the COMESA Communication Strategy.
According to a COMESA study conducted last year titled ‘Export Potentials of Intra-COMESA Trade’ Zimbabwe has the potential to increase intra-COMESA trade by US$ 4.1 billion. Eleven of its export products have the highest trade potential, including tar distilled from coal, fruits of the genus capsicum, avocados, glass products, and tungsten ores and concentrates.
Japan auto parts makers diversify supply chain to North Africa (Nikkei Asia)
Yazaki and other Japanese auto suppliers are setting up production bases in North Africa to diversify their supply chains in the face of increasing geopolitical risks in Eastern Europe amid the Ukraine war.
Wire harness supplier Yazaki will pour 9 billion yen ($69 million) to raise output at its Morocco plants by around 25%. Of the fresh investment, 5 billion will be spent on building a new production facility in Meknes, in the north of Morocco. Yazaki will start construction of the Meknes facility this year and a new one in Egypt in 2023. The company will also increase capacity at its existing plants in Tangier and Kenitra.
Morocco is attractive because of its proximity to Europe and its close trade ties with the continent. Thanks to free-trade agreements with the EU, Moroccan exports to the bloc are exempt from tax. According to the Japan External Trade Organization, 250 auto-related companies operate facilities there.
Tough reforms needed to improve financing gap — BoG’s Elsie Awadzi (Modern Ghana)
Madam Elsie Addo Awadzi, the Second Deputy Governor of the Bank of Ghana (BOG) says that a boost in Africa’s long-term competitiveness on the global market will depend on financing for robust macro-economic recovery and medium to long term investment.
However, financing, she said, had remained a big challenge as the estimated financing gap for Africa was about $285 billion in additional funding that would be required from 2021 to 2025 to effectively respond to the effect of the pandemic.
Speaking at the Money Summit under the theme, “Africa’s Economic Growth: Facilitating Investment, Payment and Settlement Systems,” Mrs Awadzi said that improving governance and the business environment was key for promoting investment climate that would attract the needed capital flow.
PAPSS, BUNA to build payment gateway for Africa, Arab region (Businessday)
The Pan-African Payment and Settlement System (PAPSS) operated by African Export-Import Bank (Afreximbank) in collaboration with the African Continental Free Trade Area (AfCFTA) Secretariat, has announced the signing of a Memorandum of Understanding (MoU) with BUNA, the cross-border and multi-currency payment system owned by the Arab Monetary Fund (AMF).
Interoperability among payment systems, as the foundation for enhancing cross-border payments, requires technical, process and business system compatibility so that end users can seamlessly transact with each other across systems. This collaboration lays the foundation for the interoperability between PAPSS and BUNA payment systems, their participants will be able to make fast, secure and affordable transactions in their local currencies between the African continent and the Arab region.
Forging deeper relations on the continent (SAnews)
President Cyril Ramaphosa says the future of Africa depends on the strengthening and deepening of relations between countries on the continent. The President said this during his opening remarks at the State Visit of President of Guinea Bissau, General Umaro Sissoco Embaló, in Pretoria.
During his opening remarks, President Ramaphosa said the visit presents an opportunity for the two countries to implement the General Cooperation Agreement signed by the two countries in 2008 which, he said, should also form part of implementing the African Continental Free Trade Area (AfCFTA) agreement. According to President Ramaphosa, other areas of cooperation for intra-African trade include that: Preference should be given to SOEs and businesses “when bidding for significant procurement contracts in each other’s countries” and Exploration for investment opportunities by South African companies in Guinea Bissau in areas such as agriculture, mining, energy, manufacturing and infrastructure.
Africa faces new shock as war raises food and fuel costs (IMF Blog)
Sub-Saharan African countries find themselves facing another severe and exogenous shock. Russia’s invasion of Ukraine has prompted a surge in food and fuel prices that threatens the region’s economic outlook. This latest setback could not have come at a worse time—as growth was starting to recover and policymakers were beginning to address the social and economic legacy of COVID-19 pandemic and other development challenges. The effects of the war will be deeply consequential, eroding standards of living and aggravating macroeconomic imbalances.
The IMF now expects growth to slow to 3.8 percent this year from last year’s better-than-expected 4.5 percent, according to the latest Regional Economic Outlook. Though we project annual growth to average 4 percent over the medium term, it will be too slow to make up for ground lost to the pandemic. Inflation in the region is expected to remain elevated in 2022 and 2023 at 12.2 percent and 9.6 percent respectively—the first time since 2008 that regional average inflation will reach such high levels.
Africa: Shocks for an Already-Stretch Region - IMF Africa Head Abebe Selassie Discusses Hard Choices (allAfrica)
For African leaders, input from the International Monetary Fund is factor that must be considered when economic policies are decided. During the 1980s and 1990s, the Fund was frequently criticized for ‘structural adjustment’ programs that made free-market policies a condition for much-needed financial assistance. A more collaborative working relationship with less-developed member countries including those from Africa, has softened the public image.
The Regional Economic Outlook (REO) for Sub-Saharan Africa – one of a semi-annual series on each region and the world – acknowledges the challenges Africa is facing. Since publication of the last regional outlook in October, when modest growth was projected, “sub-Saharan Africa has experienced a series of adverse shocks.” More recently, the war in Ukraine, which has result in higher commodity prices, has added to the ongoing impact of the pandemic, Africa’s low vaccination rates and damage caused by the climate crisis as well as political instability and conflict in several areas.
Africa mulls innovations to reduce reliance on food import (The New Times)
The current situation where Africa relies on food imports from other continents is precarious. Not only does it cause an increase in food prices for its population, but it also leads to shortages as evidenced by the Covid-19 pandemic and the Russia-Ukraine war. This is one of the observations made by actors in Africa’s agriculture sector on April 26, during the Africa Wide Science Technology and Innovation Conference held in Rwanda.
“The continent is highly vulnerable because we are importing a massive amount – close to 30 per cent of food in the continent is actually being imported,” said Martin Bwalya, Ag Director for Knowledge Management and Programme Evaluation at the Africa Union Development Agency, (AUDA-NEPAD). “And that is a huge risk the continent is taking. Because anything can happen in those supply chains, in those systems as we’ve seen it during Covid-19, we’ve seen it now during the Ukraine war,” he observed.
Urbanisation in Africa contributes to better economic outcomes and higher standards of living, with cities notably outperforming national averages across most socio‑economic indicators such as education, health and employment, according to a new report. Produced by the Sahel and West Africa Club (SWAC/OECD) in partnership with the United Nations Economic Commission for Africa (ECA) and the African Development Bank (AfDB), the report Africa’s Development Dynamics 2022 analyses data from four million individuals and firms in 2,600 cities across 34 African countries. It offers the most extensive assessment of the impact of Africa’s cities on social and economic outcomes. Speaking at the virtual launch, Dr. Ibrahim Assane Mayaki, SWAC Honorary President and CEO of AUDA-NEPAD, said: “Africa’s cities […] have maintained their economic performance despite growing by 500 million people over the last 30 years, providing several hundred million people with better jobs and improved access to services and infrastructure. This in a context of very limited public support and investment is probably one of the most underappreciated achievements of African cities.”
Conflict minerals due diligence scheme failing in Africa, group warns (Global Trade Review)
Campaign group Global Witness says it has uncovered “compelling evidence” that minerals linked to armed conflict and human rights abuses in the Democratic Republic of Congo have been laundered through an influential due diligence scheme.
Major companies including Apple, Intel and Tesla use the International Tin Supply Chain Initiative (ITSCI) to responsibly source tin, tantalum and tungsten (3T metals) from the African Great Lakes region, which encompasses countries such as the Democratic Republic of Congo (DRC), Rwanda, Burundi and Uganda.
Given the vital role of these minerals in the manufacture of various consumer products, including smartphones, computers and automotive systems, foreign companies are being urged to ramp up their due diligence efforts.
Ethiopia signs the African Medicines Agency Treaty (2merkato)
Ethiopia has signed the treaty of the African Medicines Agency (AMA). Dr. Lia Tadesse, Ethiopia’s Minister of Health, has inked the treaty at the AU headquarters. Ethiopia is the 29th African Union member state to sign the treaty. Dr. Monique Nsanzabaganwa, Deputy Commissioner of AU Commission, for her part, remarked the establishment of AMA will help make sure there is a sustained medical provision across Africa. She also reiterated the importance of the platform to establish a strong regulatory framework and create a vigorous local medical industry in the continent.
Global economy news
The World in Disarray: Is This the End of Multilateralism for Trade? (Observer Research Foundation)
For decades, trade has been an important driver for economic growth, job creation, and wellbeing. It helped lift billions of people out of poverty, and promoted economic—and in some cases political—freedom. It allowed for a diffusion of knowledge and ideas and created interdependencies that—while not always preventing conflicts and wars, as Russia’s war on Ukraine shows—contributed to international stability. The multilateral trading system, with the World Trade Organization (WTO) at its centre, held power politics at bay and allowed for settling trade disputes in a rules-based and mostly fair way.
These times seem to be over. Great power politics, a competition of ideas and systems, cold and hot conflicts, as well as wars threaten to divide the world into new blocks—large autocracies on one side, and liberal democracies on the other. Trade is increasingly seen from a security lens: As a source of national vulnerabilities, and as a coercive, strategic instrument. This will massively impact trade flows. It will accelerate the re-regionalisation and re-nationalisation of value chains that began a few years ago, gaining momentum during the COVID-19 pandemic, and is fuelled by the power competition between the United States and China. At the same time, the WTO, which is already fragile, could weaken even further, at a time when a strong institution is more important than ever.
What are the current trends in trade and how healthy is the multilateral trading system? What are possible scenarios for the WTO and what needs to be done to reform it so it can continue doing its job?
DG Okonjo-Iweala urges US business to continue backing the WTO (WTO)
The Director-General spoke in Washington at the National Foreign Trade Council Foundation’s annual dinner where she received the organization’s prestigious World Trade Award.
In her speech, Dr Okonjo-Iweala acknowledged that the COVID-19 pandemic and now the war in Ukraine had disrupted trade, strained global supply chains and led many companies to rethink trading patterns and supply options. Moreover, she said, some commentators have even begun to question multilateralism itself, suggesting that trade be conducted in two or three competing or perhaps adversarial blocs.
Goods Council addresses high number of trade concerns, notification issues, LDC graduation (WTO)
The Council heard 41 trade concerns on measures maintained or newly introduced by 25 WTO members, which included 11 new issues. These concerns were raised over a wide range of measures, including tariffs and tariff rate quotas, import and export bans and restrictions, technical barriers to trade, sanitary and phytosanitary measures, alleged discriminatory domestic taxation, domestic content requirements, import licensing requirements and countervailing duties. The measures encompass a wide range of sectors (e.g. agricultural, information technology, fisheries, forestry and food products) as well as specific products, such as air conditioners, apples, cheese, cosmetics, energy drinks, instant coffee, mobile phones, pears, plain copier paper, pulses, tyres and steel.
Concentrated digital markets need stronger scrutiny to protect consumers (UNCTAD)
A small number of companies such as Google, Amazon, Meta, Apple and Microsoft dominate global digital markets. Their business models heavily rely on massive data collection, storage and processing to achieve market power. This can undermine “competition on the merits” and potentially shut out smaller rivals, as the dominant platforms use the granular data they collect – such as search histories, social networks, contacts and prior purchases – to tailor and micro-target advertisements to specific consumer segments. At UNCTAD’s eCommerce Week 2022, a high-level session on April 28 brought together governments, regulators and economists to discuss how to tackle data-driven market dominance of digital platforms while ensuring better consumer protection.
“The rapid growth of digital platforms entails new challenges in terms of regulating data use and developing data-based economies, specifically in the proper management and treatment of data, respect for users’ privacy, and enhancing competition between digital platforms,” said Carmen Ligia Valderrama Rojas, Colombia’s minister of information and communication technologies.
But the current competition regime remains inadequate or insufficient in handling competition issues in digital markets.
New partnership forged to make the digital economy work for all (UNCTAD)
A new strategic partnership between the International Chamber of Commerce (ICC) and the eTrade for all initiative seeks to strengthen efforts towards more inclusive development outcomes from the digital economy. The partnership was announced on 25 April during the UNCTAD eCommerce Week held in Geneva and online, following a vetting process among the initiative’s 34 members.
The eTrade for all initiative serves as a global helpdesk for developing countries to bridge the knowledge gap on e-commerce. It provides access to information and resources, promotes inclusive dialogues on e-commerce and the digital economy and catalyses partnerships.
It will enable consistent, systematic and strategic engagement of micro, small and medium-sized enterprises (MSMEs) across all sectors, which are affected by the increased digitalization of economies in developing and developed countries.
The World Can Stop Capital Flight Now (Inter Press Service)
Curbing capital flight from developing countries is long overdue. New sanctions against Russian oligarchs show this can be done with the requisite political will. Recent research also shows how to more effectively stop capital flight.
Capital flight is widespread, with resource-rich countries more vulnerable. ‘Mis-invoicing’ exports and embezzling export earnings of state-owned mineral companies have been central to such wealth appropriation.
Capital flight is enabled, not only by national conditions, but also by transnational facilitators. Internationally, capital flight is aided by institutions and professional enablers such as bankers, lawyers, accountants and consultants.
Developing countries – especially resource-rich economies – are generally more susceptible to abuse. Wealth buys power and influence, enabling further accumulation. Thus, in the real world, natural resource endowments become a curse – not a blessing.
Many developing countries continue to suffer significant resource outflows, largely due to illicit capital flight. On the trail of capital flight from Africa: The Takers and the Enablers – edited by Leonce Ndikumana and James Boyce – studies this blight in sub-Saharan Africa. The world has much to learn from their forensic analysis. The volume estimates haemorrhage from African countries since 1970 at US$2 trillion! Of this, almost 30% has been lost in the 21st century. Adding interest, cumulative offshore assets were US$2.4 trillion by 2018 – more than thrice Africa’s external debt!
DG Okonjo-Iweala: Trade has central role in addressing food security challenges (WTO)
DG Okonjo-Iweala stressed that trade and food security has long been a critical issue on the WTO agenda but has now “shot to the top of the global policy agenda” due to the impact of the Ukraine conflict, especially in countries dependent on food exports from Ukraine and Russia. The high-level participation at the seminar was testimony to the importance the international community attaches to this issue, she said. Russia and Ukraine together account for more than one-quarter of all traded wheat, and around three-quarters of world exports of crude sunflower oil, said the DG. In addition, Russia accounts for nearly one-tenth of fuel exports and, together with Belarus, one-fifth of the world supply of fertilizer. She emphasized that households in Africa and the Middle East are particularly vulnerable to disruptions in these supplies
“35 countries in Africa import food and 22 import fertilizer from Russia, Ukraine, or both countries.” This could exacerbate the hunger already faced by millions of people around the world. The current spike in food prices comes on top of challenges due to the pandemic, economic downturns, climate-related shocks and conflict, she noted.
Commodity Markets Outlook April 2022 (World Bank)
The war in Ukraine has dealt a major shock to commodity markets, altering global patterns of trade, production, and consumption in ways that will keep prices at historically high levels through the end of 2024, according to the World Bank’s latest Commodity Markets Outlook report. The increase in energy prices over the past two years has been the largest since the 1973 oil crisis. Price increases for food commodities—of which Russia and Ukraine are large producers—and fertilizers, which rely on natural gas as a production input, have been the largest since 2008. “Overall, this amounts to the largest commodity shock we’ve experienced since the 1970s. As was the case then, the shock is being aggravated by a surge in restrictions in trade of food, fuel and fertilizers,” said Indermit Gill, the World Bank’s Vice President for Equitable Growth, Finance, and Institutions. “These developments have started to raise the specter of stagflation. Policymakers should take every opportunity to increase economic growth at home and avoid actions that will bring harm to the global economy.
Climate change putting 4% of global GDP at risk, new study estimates (Reuters)
Climate change could see 4% of global annual economic output lost by 2050 and hit many poorer parts of the world disproportionately hard, a new study of 135 countries has estimated. Ratings firm S&P Global, which gives countries credit scores based on the health of their economies, published a report on Tuesday looking at the likely impact of rising sea levels, and more regular heat waves, droughts and storms.
Bangladesh, India, Pakistan and Sri Lanka’s exposure to wildfires, floods, major storms and also water shortages mean South Asia has 10%-18% of GDP at risk, roughly treble that of North America and 10 times more than the least-affected region, Europe. Central Asia, the Middle East and North Africa and Sub-Saharan Africa regions all face sizable losses too. East Asia and Pacific countries face similar levels of exposure as Sub-Saharan Africa, but mainly because of storms and floods rather than heat waves and drought.
Shared fortunes: Why Britain, the European Union, and Africa need one another (European Council on Foreign Relations)
Britain and Africa are deeply connected through their history and people as much as through trade, investment, aid, and culture. They can both benefit greatly from this relationship – especially in areas where their interests converge, including economic development, security, education, and climate. But political forces on both sides could push them apart – even as, increasingly, Britain needs Africa more than Africa needs Britain.
A closer and more responsive relationship between Britain, Africa, and the EU would have significant benefits for all sides – partly because each is weaker individually than they are together, and because Britain still has strengths that are most useful in cooperation with others. But this will only be possible if the British government significantly changes its approach to Europe as well as to Africa.