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COMESA Judges trained on regional integration issues
Judges of the COMESA Court of Justice have completed a training programme aimed at deepening their understanding of regional integration and dispute settlement as they adjudicate on trade and investment issues in the region.
Sponsored by the Trade Law Centre (TRALAC), a non-profit making capacity-building organization, the judges – who took over about eight months ago – went through an intensive two-day training in international trade law and policy and dispute resolution within regional economic communities. The training took place at the University of Cape Town, South Africa on 7-8 March 2016.
As Judge President of the Court Justice Lombe P. Chibesakunda observed during the opening of the training, COMESA Court judges are appointed from different legal/judicial backgrounds to find themselves thrust into the realm of regional and international trade law and policy.
“While this is not to say that we have not, in one way or another encountered disputes that would fall into this realm, the fact is that, as Judges of a regional Court, we must not only understand the environment in which we are dispensing justice, but must also equip ourselves with the necessary knowledge and skills,” the Judge President observed.
She said it was extremely important for the judges to gain a sound understanding of regional integration and dispute settlement hence the training will have a great impact on the quality and relevance of jurisprudence that will emanate from the Court.
Justice Chibesakunda expressed gratitude to the TRALAC team for the generous contribution it was making towards capacity building in regional integration especially to the COMESA Court judges. These include;
“The rights granted under the free movement of goods, services and people policies and how the Court interprets the COMESA Treaty and/or decisions, directives of Council of Ministers or the Authority (of Heads of State) when there is an allegation of breach. This is in addition to what the Tripartite Free Trade Area entails and how this will impact the work of the Court.”
The training was conducted by the TRALAC team led by Executive Director, Ms. Trudi Hartzenberg and Prof. Gerhard Erasmus.
The Court President confirmed an invitation from TRALAC to the judges to attend its annual conference in Namibia in April 2016.
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World Bank and Global Environment Facility (GEF) launch new multi-million dollar ‘Global Platform for Sustainable Cities’
International community invests in the Sustainable Cities of the Future
City leaders from around the world met in Singapore on 9 March 2016 for the launch of the ‘Global Platform for Sustainable Cities’, or GPSC, which is part of an initiative funded by the Global Environment Facility (GEF) that is expected to mobilize up to $1.5 billion over the next five years for urban sustainability programs in 11 developing countries, including Brazil, Cote D’Ivoire, China, India, Malaysia, Mexico, Paraguay, Peru, Senegal, South Africa, and Vietnam.
Coordinated by the World Bank and supported by multilateral development banks, UN organizations, think tanks and various city networks, the GPSC is a knowledge sharing program that will provide access to cutting-edge tools and promote an integrated approach to sustainable urban planning and financing. The GPSC will work with a core group of 23 cities, but will reach many more by sharing of data, experiences, ideas, and solutions to urban challenges, and by linking the knowledge to finance that will influence investment flows toward building cities’ long-term urban sustainability.
“If planned and managed well, compact, resilient, inclusive, and resource-efficient cities can drive development, growth, and the creation of jobs, while also contributing to a healthier, better quality of life for residents and the long-term protection of the global environment,” said Naoko Ishii, GEF CEO and Chairperson. “In a rapidly urbanizing world, how we design and build the cities of the future will play a critical role in protecting the global commons, the planet’s finite environmental resources that have provided for the stable conditions enjoyed by humanity for thousands of years.”
By 2050, more than 2 billion more people will live in cities, a 50 percent increase from today, and the vast majority of this growth will take place in developing countries, mostly in Asia and Africa. The new Global Platform is designed to help mayors and other municipal leaders take more informed decisions in the day-to-day management of their cities, including improving access to clean water, energy, and transport, as well as efforts to mitigate climate change. It supports cities in pursuing evidence-based approaches to urban planning, including geospatial data, and establishing urban sustainability indicators.
“Linking knowledge to finance is critical to directing investment flows to quality and sustainability. We see this platform as a great opportunity to connect cities not only to cutting-edge knowledge, but also to development banks and financial institutions,” said Ede Ijjasz-Vasquez, Senior Director of the World Bank’s Social, Urban, Rural, and Resilience Global Practice. “The World Bank will work closely with the partner institutions and the existing city networks to build a broad cooperation to support cities in translating knowledge into action and investment.”
In particular, the GPSC will provide cities with ways to help confront issues like climate change, to which cities are uniquely vulnerable, as almost half a billion urban residents live in coastal areas, increasing their exposure to storm surges and sea level rise. Cities also consume over two-thirds of global energy supply, and are responsible for 70 percent of greenhouse gas emissions.
The products and services provided by the GPSC will include studies, workshops, and online data that will leverage existing expertise in order to promote an integrated approach to tackling complex, multi-sector issues. With common metrics and guidelines in place, the lessons learned from the initial 23 cities can also be shared with hundreds of other cities via a wide range of city networks and other partners.
The GPSC is the foundation of the wider GEF sustainable cities initiative that is expected to create a strong network of cities that will act as global ambassadors for urban sustainability planning, with tangible benefits at both the local and global levels. As a GEF partnership, the initiative, formally called the ‘Sustainable Cities Integrated Approach Pilot’, will involve city municipalities, GEF agencies, development entities, city networks, and technical institutions. Civil society organizations will also contribute.
It will be implemented by the World Bank in partnership with the African Development Bank, the Asian Development Bank, the Development Bank of South Africa, the Inter-American Development Bank, the United Nations Environment Programme, the United Nations Development Programme, and the United Nations Industrial Development Organization.
The GPSC launch event was held during Singapore Urban Week, organized by the World Bank in partnership with the GEF and key partners in Singapore, including the Center for Liveable Cities and IE Singapore.
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tralac’s Daily News Selection
The selection: Wednesday, 9 March 2016
Starting today, in Lusaka: the AU-RECs-UNECA-AfDB-NEPAD-ACBF joint coordination meeting
The meeting, 9-11 March, is expected to achieve the following outcomes: Updates on work in progress on the implementation of the first Ten-year implementation plan of Agenda 2063 and a strategic discussion on how to accelerate implementation of flagship projects by the AUC, RECs and other institutions. The meeting will also look at how the SDGs fits in and are subsumed in Agenda 2063. Make recommendations on the delineation of roles and responsibilities amongst AUC, RECs, NPCA and other relevant institutions to ensure the execution of different programmes in the implementation of Agenda 2063 and improve teamwork, responsibility sharing and strengthen role of RECs as the building blocks of the AU. [Downloads]
WTO Committee on Sanitary and Phytosanitary Measures: submissions by AUC, SADC (WTO)
Angola, Mozambique: trade between China and Portuguese-speaking countries falls 18% in January (Macauhub)
Trade with Angola, China’s second largest Portuguese-speaking trading partner, totalled US$1.100bn (-23.23%), with Chinese exports falling 46.41% to US$156m and imports of Angolan products reaching US$944 million (-17.29%). The value of trade between China and Mozambique was US$129m (-33.11%), with Chinese exports of US$86m (-44.17%) and imports of US$43m (+10.25%).
Tanzania: tourism industry now worth over $2bn a year (IPPMedia)
While a marked increase in foreign tourist arrivals boosted Tanzania’s tourism earnings in 2015 to $2.23bn, industry players have warned that an unconducive business environment and security concerns in the region could soon stifle further development of the sector, and maybe even cause a decline. Despite a tough tax regime, infrastructural constraints and local tourism firms recording a slowdown in business, the Bank of Tanzania confirmed in a new report issued yesterday that tourism continues to be the country’s biggest source of foreign exchange at present, easily outperforming the mining and manufacturing sectors. Tourism revenues soared 11% in 2015 on the back of higher tourist numbers, the central bank said in its latest monthly economic review. [Download: January Monthly Economic Review]
Kenyan firms record highest export rate in 10 months (Business Daily)
Exports by Kenyan firms grew at the highest rate in 10 months in February, driven by increased demand for their goods in neighbouring countries, according to a survey of purchasing managers in 400 companies. The CfC Stanbic Purchasing Managers Index survey for February shows that the growth in export orders allowed the firms to keep output levels high and hire additional staff in an effort to cut backlogs.
Rwanda's export challenge (New Times)
My view is that Rwanda is fast approaching that tipping point where extra effort towards efficiency is rewarded with less economic gains. For the Rwandan economy to continue to thrive and breakout of the poverty trap, some radical changes at a structural level have to be made. Allow me to share three long term strategies that could go some way in expanding the economy: [The author: Eddie Mugarura]
Zimbabwe: January 2016 trade data (NewsDay)
Data released by the Zimbabwe National Statistics Agency last week showed that exports in January amounted to $249 million against $399 million worth of imports, which remain heavily skewed towards consumptive products following a significant drop in raw materials importation. Most of the imports were consumptive products such as bottled water, sugar, soap, cooking oil, cellphone handsets, electronics, vehicles spares, clothing and second hand vehicles. Cumulatively, imports from January 2015 to January this year amounted to $6,4 billion while exports were at $2,9 billion.
South Africa: Deficit and rand dilemma for Reserve Bank (Business Day), Moody's places South Africa's Baa2 ratings on review for downgrade: statement (Moody's), Peter Attard Montalto, emerging market analyst with Nomura: 'SA Inc: more questions than answers' (IOL), Quintin Starkey, chairman of the Metal Recyclers Association: 'Proposed scrap metal export clampdown will hit workers' (Business Day), Rong Yansong, economic and commercial counsellor of the Chinese Embassy, Pretoria: 'Economic transformation: China, SA should co-operate' (IOL)
Kenya: Training to improve market access for local products (COMESA Business Council)
The training comes after the successful completion of similar workshops in Zambia and Rwanda; 80 agro-food suppliers in Zambia and 97 in Rwanda received training on quality and food safety standards. This training is timely for Kenya after the recent unveiling of the decade long plan, aptly christened Kenya’s Industrial Transformation Programme, which looks beyond import-substitution and prioritizes leveraging on local industries to grow the manufacturing sector to levels above 15% of GDP from a static 11% over the past decade.
Shippers lobby’s new cargo clearance system set for pilot (Business Daily)
The Shippers Council of East Africa will roll out the Advance Cargo Shipment Information System for two months starting March 18 as the lobby seeks to make trade and cargo importation and exportation less tedious for shippers. The system, also referred to as Electronic Cargo Tracking Notes (ECTN), is envisaged to reduce congestion at the port and cut operation costs resulting from demurrage and storage charges for imports. The system is also meant to improve efficiency and curb revenue leakages. Cargo heading to Kenya will be covered by Electronic Cargo Tracking Notes or Cargo Shipment Information — a maritime document issued by the shipper at the loading port providing information including its flows to destination country.
Related: EAC’s joint cargo clearance deal bears fruit for traders (Business Daily), Kenya to talk up her security, address costs in Uganda pipeline meet (Daily Nation), George Wachira: 'What Uganda-Tanzania crude oil pipeline pact means for Kenya' (Business Daily)
WTO members urged to start preparing for entry into force of Trade Facilitation Agreement (WTO)
The chairman of the Preparatory Committee on Trade Facilitation, Esteban Conejos, told the committee on 3 March that the WTO has now received 81 “Category A” notifications from members indicating which provisions of the TFA they will implement upon entry into force of the Agreement (or one year after entry into force for least developed countries – LDCs). “What is even more encouraging is that we also started receiving a growing number of B and C notifications,” the chairman said. “This is especially important since we are getting closer to seeing the Trade Facilitation Agreement enter into force – which equally shortens the remaining time for submitting B and C-related inputs.” [Various downloads available]
Chinese firms explore investments in four African countries at ITC-organised seminar (ITC)
Representatives from 90 Chinese companies last week expressed strong interest in investing in Africa, following a seminar on promoting investment in Ethiopia, Kenya, Mozambique, and Zambia. More than 190 businesspeople joined government officials from China and the four African countries at the 25-26 February event in Tangshan, Hebei Province, China. Organized by ITC, the China-Africa Development Fund (CADFund) and the China Council for the Promotion of International Trade (CCPIT), the seminar was held under the Partnership for Investment and Growth in Africa (PIGA), which aims to promote growth and job creation in Africa by deepening trade and investment ties with China.
Reallocation of unused FY 2016 WTO tariff-rate quota volume for raw cane sugar (USTR)
Based on consultations with quota holding countries, USTR is reallocating 86,533 metric tons raw value of the original TRQ for raw cane sugar from countries that are unable to fill previously allocated FY 2016 WTO raw sugar TRQ quantities. USTR is allocating this quantity to the following countries in the quantities specified below: [including] Malawi, Mauritius, Mozambique, South Africa, Swaziland, Zimbabwe.
US commerce official to lead department’s education trade mission to Africa (University Business)
US Assistant Secretary of Commerce for Industry & Analysis Marcus Jadotte is leading 25 US colleges and universities on a three-country education trade mission to Cote d’Ivoire, Ghana and South Africa, March 7-13. Educational services are one of the United States’ top 10 services exports. During the 2014-2015 academic year, the United States hosted nearly one million globally mobile students. Slightly less than 34,000 students, or three percent, came from Sub-Saharan Africa.
Harmonising national laws in the East African Community (AWEPA)
The EALA Committee on Legal, Rules and Privileges undertook an oversight activity to assess and evaluate the process of harmonisation of national laws in the East African Community. Between 23-25 February, the LRP Committee assessed and reviewed the activities of the Sub-Committee on the Approximation of National Laws. Subsequently, the Committee will make recommendations on how the process of the harmonisation of laws can be improved. [UN launches platform to enhance disaster response in E Africa (CIHAN)]
Strengthening SADC parliamentary engagement in the budget cycle (AWEPA)
AWEPA is pleased to announce its new programme, Strengthening SADC Parliamentary Engagement in the Budget Cycle, funded by the UK Department for International Development. Extensive comparative research, currently absent in the SADC region, will be conducted to ascertain the baseline of existing legal frameworks, parliamentary activism, and staff capacity available to support parliamentary engagement in the ex-ante phase of the budgeting process. The resulting data will inform peer-to peer reflection and analysis among SADC MPs for further discussion in their respective home parliaments.
The African Development Bank and the World Bank jointly hosted a High-Level Panel session on March 3, 2016. The session was part of the World Bank's Fragility, Conflict and Violence Forum, which took place from March 1-3, 2016 in Washington, DC. The natural resource sector is an important part of Africa's economic activities, contributing more than 20% of GDP in 22 resource-rich countries on the continent. However, fragility presents a major constraint on the extent to which natural resources contribute to equitable and sustainable development on the continent.
David Lipton: 'Policy imperatives for boosting global growth and prosperity' (IMF)
What may be most disconcerting is that the rise in global risk aversion is leading to a sharp retrenchment in global capital and trade flows. Last year, for example, emerging markets saw about $200bn in net capital outflows, compared with $125bn in net capital inflows in 2014. Trade flows meanwhile are being dragged down by weak export and import growth in large emerging markets such as China, as well as Russia and Brazil, which have been under considerable stress. Furthermore, inflation has fallen to historical lows. Headline inflation in advanced economies in 2015, at 0.3 percent, was the lowest since the financial crisis, and in emerging markets core inflation remains well below central bank targets. Why should we be concerned about these developments?
Chinese January exports slump, outlook worrying (Shanghai Daily)
Exports in dollar-denominated terms were more than 25% lower than in February 2015, worsening from the 11.2-percent decline in January and the sharpest drop since May 2009, according to figures from the General Administration of Customs. In yuan-denominated terms, exports slumped 20.6% year on year to 821.8 billion yuan ($126.3bn) in February, a steeper fall than 6.6% in January. The data is "ringing alarm bells on the state of the factory sector," said Tom Orlik, chief Asia economist at Bloomberg.
African Union pushes for more commitment from the UN General Assembly (AU)
Botswana: State minerals company takes off (Mmegi)
Uganda: Parliament seeks inquiry into sale of 130 public companies (Daily Monitor)
Kenyan banks lose Sh12.7bn in South Sudan’s currency crisis (Business Daily)
Holding company to be established to promote Egyptian products in Africa (Daily News)
Saving Egypt's public sector (Ahram)
Zimbabwe: Poultry industry contracts (NewsDay)
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Obama Administration actions open South African market to U.S. agriculture
Out-of-Cycle Review of South Africa Under AGOA Leads to Breaking Down Barriers to U.S. Poultry, Pork, and Beef
The United States and South Africa have negotiated the removal of long-standing barriers to U.S. agricultural products entering South Africa, following intensive engagement under the new out-of-cycle review mechanism of the African Growth and Opportunity Act (AGOA).
The removal of these unfair barriers opens the door for American poultry, pork, and beef to be available to consumers in South Africa; delivering real value for American farmers.
To be eligible for benefits under AGOA, beneficiary countries must be making continual progress towards eliminating barriers to trade and investment with the United States. On November 5, 2015, President Obama indicated to Congress and the South African government that South Africa was failing to meet this criteria and that he intended to suspend duty-free treatment for all AGOA-eligible agricultural goods from South Africa after 60 days. The United States nonetheless continued to work with South Africa to resolve the key issues relating to market access for poultry, pork, and beef. Those issues have now been resolved by South Africa. These successful enforcement efforts are the latest example of the President’s commitment to holding our trading partners to their commitments.
“Today, both the United States and South Africa have achieved significant wins,” said Ambassador Michael Froman. “American farmers have access to an important market from which many have been shut out for more than a decade. And, on the other side, South African consumers will be able to buy and enjoy high-quality American agricultural products, and historically disadvantaged poultry farmers will receive technical assistance from the U.S. poultry industry. We have also strengthened our relationship with South Africa; proving that we can work together to resolve longstanding issues, which is important to businesses and workers on both continents. And we have shown, once again, the priority the Obama Administration places on enforcing obligations under our international arrangements, to ensure that American exporters can compete fairly around the globe.”
Background & Economic Impact
South Africa maintained several long-standing barriers to U.S. agricultural exports. Exports of U.S. bone-in chicken were effectively excluded from the South African market for 15 years due to a range of trade barriers and other measures. Likewise, exports of U.S. pork and beef were blocked from the South African market for several years due to unwarranted sanitary restrictions. In response to these and other concerns, Congress mandated in the Trade Preferences Extension Act of 2015 (TPEA) that the Administration initiate an out-of-cycle review of South Africa’s eligibility for AGOA benefits, in particular of the requirement that beneficiary countries be making continual progress towards eliminating barriers to U.S. trade and investment. This review was initiated on July 21, 2015. In the context of this review, South Africa committed to benchmarks on poultry, pork, and beef that it would need to meet in order to demonstrate compliance with AGOA’s eligibility requirements.
On November 5, 2015, the President determined that South Africa had not met these benchmarks, and notified Congress and South Africa of his intent to suspend South Africa’s AGOA benefits in the agricultural sector for failure to meet the AGOA eligibility requirements.
Although South Africa made progress certain benchmarks in the following month, it did not meet all of them. Thus, on January 11, 2016, the President issued a proclamation suspending South Africa’s agricultural products under AGOA, with an effective date of March 15, 2016. The delayed suspension provided additional time for American poultry to enter into commerce in South Africa, which was the last major benchmark, as well as an opportunity to finalize needed documents for shipments of pork. On February 29, 2016, American poultry entered South African commerce, and on March 1, 2016, the remaining benchmarks were met with regard to U.S. pork. As a result, South Africa has now met all the agreed-upon benchmarks for U.S. poultry, pork, and beef to demonstrate its compliance with AGOA eligibility requirements. The President will now make a determination regarding revocation of the earlier proclamation on South Africa’s AGOA eligibility. The United States will continue to monitor South Africa’s compliance under AGOA and looks forward to South Africa implementing the agreements made regarding entry of U.S. poultry, pork and beef into the South African market.
With the removal of South Africa’s barriers to exports of U.S. poultry, pork, and beef, U.S. exports of these products could reach up to $160 million annually. Annual exports of U.S. poultry to South Africa could reach $100 million, exports of U.S. pork $40 million, and exports of U.S. beef $17 million.
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Chinese firms explore investments in four African countries at ITC-organised seminar
PIGA project aims to spur African job creation, income growth through increased Chinese trade and investment
Representatives from 90 Chinese companies last week expressed strong interest in investing in Africa, following a seminar on promoting investment in Ethiopia, Kenya, Mozambique, and Zambia. More than 190 businesspeople joined government officials from China and the four African countries at the 25-26 February event in Tangshan, Hebei Province, China.
Organized by ITC, the China-Africa Development Fund (CADFund) and the China Council for the Promotion of International Trade (CCPIT), the seminar was held under the Partnership for Investment and Growth in Africa (PIGA), which aims to promote growth and job creation in Africa by deepening trade and investment ties with China. Funded by the United Kingdom’s Department for International Development (DFID), PIGA seeks to sustainably boost incomes for people living in poverty in Africa through greater integration of small and medium-sized enterprises into global value chains.
The seminar aimed to increase Chinese investors’ awareness about opportunities in the four African countries, and initiate discussions on potential investment projects.
In his remarks to the seminar, Xuejun Jiang, chief of ITC’s Office for Asia and the Pacific, argued that trade and investment with China offered a major opportunity to support Africa’s structural shift from low- to high-productivity activities. “In order to achieve this transition and inclusive growth, Africa needs manufacturing and agricultural investments anchored in export markets,” he said. “This seminar will provide information on investment opportunities in manufacturing and agro-processing sectors in four African countries which will be useful for Chinese companies to make investment decisions in the future.”
Investment promotion officers from the Ethiopia Investment Commission, the Kenya Investment Authority, the Mozambique Investment Promotion Centre (CPI) and the Zambia Development Agency presented opportunities in their countries’ light-manufacturing and agro-processing sectors. Senior government officials from the four countries had earlier sketched out their national investment climates, complemented by presentations from four Chinese companies on their experiences investing in those countries.
Participants from China and the four African countries said the seminar was useful both to build awareness and to establish direct contacts with each other.
Seyoum Mesfin, Ethiopia’s former foreign minister and current ambassador to China, said that “with political commitment on the part of state actors and expert support from such organizations as ITC, DFID, CADFund, as well as CCPIT, this noble initiative of PIGA has the potential to truly assist [Africa] to become the next growth pole for the global economy.”
“Under PIGA’s cooperation framework, CADFund, ITC and DFID will jointly promote the industrialization process in Africa and contribute to the poverty reduction,” added Li Dongwei, who heads CADFund’s Representative Office in Ethiopia.
After the seminar, the investment promotion officers and officials from the four African countries visited one of the largest steel companies in Tangshan, Tangsteel, and discussed potential investments in Africa.
PIGA was officially launched on 22 October 2015 in London. PIGA is a partnership among DFID, CADFund and ITC. Its goal is to leverage Chinese trade and investment ties to develop export-oriented manufacturing in Africa, contributing to growth and poverty reduction. Ethiopia, Kenya, Mozambique and Zambia are the pilot countries for the project’s one-year introductory scoping and design phase. The seminar in Tangshan was sponsored by DFID, the Tangshan Municipal People’s Government, and the CCPIT Hebei Provincial Committee.
Background
ITC to support joint China and UK effort to create jobs and growth in Africa
Launched on the sidelines of Chinese President Xi Jinping’s state visit to the UK in October 2015, the Partnership for Investment and Growth in Africa (PIGA) aims at developing export-oriented manufacturing on the continent by helping companies overcome constraints on export success.
Selected to implement the project, ITC will work with the UK Department for International Development (DFID) and the China-Africa Development Fund (CADFund), an independently operated fund that seeks to stimulate investment in Africa by Chinese companies, to spur export-oriented manufacturing.
Among ITC’s key tasks will be to identify and tackle constraints facing exporters such as inadequate market information, weak supply-side capacity, trouble overcoming regulatory barriers within the region and overseas, and obtaining access to finance, both for investment capital and to underwrite trade.
Speaking at the Geneva launch of the PIGA project, ITC Executive Director Arancha González said: “Africa is the new growth frontier. We have all said it. We all know it. We have to continue to ensure that growth delivers for the global good and for Africa itself.”
“Our approach will be market and business driven, focusing on creating more and better jobs in Africa. ITC will work with African, Chinese and British entrepreneurs to increase sustainable investments in productive sectors with high potential for export promotion and job creation in Africa,” she said.
The PIGA project seeks to increase exports and sustainable incomes for people living in poverty in Africa through greater integration into international value chains in agro-processing and manufacturing. For China and the UK, the underlying idea is that enabling sub-Saharan African countries to capture more than their current sliver of global manufacturing would reduce poverty by creating productive jobs and stable growth. As a by-product of the project, the China and the UK hope to strengthen bilateral cooperation and generate useful learning on trade-related investment and development assistance, with a particular focus on SMEs.
Zhou Xiaoming, Deputy Permanent Representative and Minister Counsellor of the Permanent Mission of the People’s Republic of China to the United Nations Office at Geneva and other international organizations, said: “This is an important initiative in addressing some of the critical issues that African countries face. With ITC on board, it adds a new dimension to the joint efforts of China and the UK in helping African countries achieve substantial development.”
Julian Braithwaite, Ambassador and Permanent Representative of the United Kingdom to the United Nations Office at Geneva and other international organizations, said: “This new partnership demonstrates how two donors, the UK and China, can work together with efficient multilateral agencies such as ITC, as catalysts for economic growth and poverty reduction in Africa.”
A preliminary ‘scoping’ phase of the project will focus on Ethiopia, Kenya, Mozambique and Zambia, for a year from November 2015. This work will serve to identify high-impact project activities that will subsequently be implemented and expanded across the rest of the region. Interventions will focus on SMEs in the four countries, with the aim of increasing employment and incomes through enhanced trade and investment.
“The UK and China are both are major providers of foreign direct investment to Africa. And both agree that the private sector must ultimately drive growth. I know this is also the case for Ethiopia, Kenya, Mozambique and Zambia who have all placed SME growth at the heart of their development strategies,” González said.
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AU-RECs-UNECA-AfDB-NEPAD-ACBF Joint Coordination Meeting
The Joint Coordination Committee meeting is scheduled to take place at Mulungushi International Conference Center in Lusaka, Zambia from 11-12 March 2016. It shall be preceded by a meeting of Experts and Senior Officials on 10 March 2016 at the same venue.
The last Joint Coordination Committee (JCC) meeting of the Chief Executives of the African Union Commission (AUC), Regional Economic Communities (RECs), United Nations Economic Commission for Africa (UNECA), and the African Development Bank (AfDB) took place in Addis Ababa, Ethiopia on 11 May 2015.
The meeting of May 2015 discussed amongst others: i) the draft of the First 10-year Implementation Plan of Agenda 2063; ii) Assessment of risks for the implementation of Agenda 2063; iii) Updates on Agenda 2063 Flagship projects; iv) issues related to the allocation of Roles and Responsibilities between the AUC and the RECs and capacities for the implementation of Agenda 2063. During this meeting, it was agreed that the Coordination meetings shall be held on a rotational basis between the AUC and the RECs. In this regard, the forthcoming meeting will be hosted by Common Market for Eastern and Southern Africa (COMESA), under the leadership of its Secretary General H.E Mr. Sindiso Ngwenya.
The forthcoming Coordination meeting scheduled to take place in Lusaka, Zambia on 11-12 March 2016, provides an opportunity for the Chief Executives and the strategic continental institutions to discuss the regional dimensions of the Ten-year implementation plan of Agenda 2063, flagship projects, roles and capacities, among other important issues.
The Coordination Meeting shall be preceded by the meeting of Experts and Senior Officials at the same venue on 10 March 2016, to consider follow-up of the implementation of the previous recommendations of the Coordination Meeting of May 2015, Monitoring and Evaluation of the Implementation of Agenda 2063, and validation of the status of integration in Africa, among others.
Objectives of the coordination meeting
The main objective of the Coordination meeting is to receive inputs, share experiences and harmonize approaches on the priorities and programmes with regards to the flagship projects in the context of Agenda 2063, covering key sectors such as; Infrastructure (transport, energy, ICT, etc.); Industrialization, Trade and Investment; Agro-processing sector; Mobility and Free movement of people and goods; Continental Free Trade Area; Skills and youth unemployment; gender equality and Peace, security and Governance. The AUC will also be expected to provide updates on the Agenda 2063 10-year Implementation Plan.
The meeting will further discuss the proposed allocation of roles and responsibilities amongst the AUC and the RECs and other institutions in the implementation of Agenda 2063, and the status of implementation of the outcomes of the last AUC-RECs-AfDB-UNECA Joint Coordination meetings held in Addis Ababa, on 11 May 2015. The draft agenda of the meeting is attached.
Expected outcomes
The meeting is expected to achieve the following outcomes:
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Updates on work in progress on the implementation of the first Ten-year implementation plan of Agenda 2063 and a strategic discussion on how to accelerate implementation of flagship projects by the AUC, RECs and other institutions. The meeting will also look at how the SDGs fits in and are subsumed in Agenda 2063.
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Make recommendations on the delineation of roles and responsibilities amongst AUC, RECs, NPCA and other relevant institutions to ensure the execution of different programmes in the implementation of Agenda 2063 and improve teamwork, responsibility sharing and strengthen role of RECs as the building blocks of the AU.
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Take forward the strategic discussions on Agenda 2063 and the SDGs, in the context of the Agenda 2063 Monitoring and Accountability Framework.
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Adoption of an Outcomes document that will be submitted to the Ministerial Retreat of the Executive Council towards the preparations for the forthcoming AU Summit to be held in Kigali, Rwanda in July 2016.
Meeting documents
It is proposed that the following background documents be prepared and circulated at the meeting:
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Minutes of the last Coordination meeting
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Agenda 2063 10 Year Implementation plan;
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Updated report on the Agenda 2063 Flagship projects;
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All thematic inputs/documents in accordance with the proposed agenda;
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Outcomes document of the Me’kele Ministerial retreat and Summit decision on recommendations;
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Agenda 2063 and SDGs.
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WTO members urged to start preparing for entry into force of Trade Facilitation Agreement
WTO members were urged on 3 March to start preparing for the entry into force of the new Trade Facilitation Agreement (TFA) by notifying to the WTO what their technical assistance and capacity-building needs are, and how much time they will need to ensure effective implementation of the Agreement.
The chairman of the Preparatory Committee on Trade Facilitation (PCTF), Esteban Conejos, told the committee on 3 March that the WTO has now received 81 “Category A” notifications from members indicating which provisions of the TFA they will implement upon entry into force of the Agreement (or one year after entry into force for least developed countries – LDCs).
“What is even more encouraging is that we also started receiving a growing number of B and C notifications,” the chairman said. “This is especially important since we are getting closer to seeing the Trade Facilitation Agreement enter into force – which equally shortens the remaining time for submitting B and C-related inputs.”
Separately, representatives from donor countries, international organizations and private sector groups met with WTO members on 4 March to outline what support they have made available to help governments implement trade facilitation reforms and to report on their experiences to date in providing assistance.
Category B covers TFA commitments that a developing country or LDC member will implement after a transitional period following the entry into force of the Agreement, while Category C covers commitments that a developing country or LDC member will implement after a transitional period following the entry into force of the Agreement and that require technical assistance and capacity-building support to implement.
Notifications on Category B and C commitments are to be submitted by developing countries upon entry into force of the TFA, with LDCs given an additional year after entry into force to submit their notifications.
To date, 70 WTO members have ratified the TFA, with 21 ratifications received since the PCTF’s last meeting in mid-October 2015. Two-thirds of the WTO’s membership must ratify the TFA in order for the Agreement to enter into force.
Ratifications in the pipeline
Several members outlined their ratification efforts during the PCTF meeting.
Brazil told members that the TFA was now before its National Congress for approval and that it had taken preparatory steps to implement TFA provisions domestically. El Salvador said its legislative assembly ratified the TFA on 4 February and that it hoped to deposit its instrument of acceptance with the WTO shortly.
Nepal noted that it submitted its Category A notification in October 2015 and that it was taking steps to secure ratification soon. Nepal highlighted the importance of the TFA to landlocked countries but said it needed substantial technical and financial assistance to ensure implementation.
Pakistan, China and the European Union also spoke to underline their support for the TFA as well as the importance of the Agreement in reducing border costs and promoting trade. They also encouraged members that have not done so to ratify the TFA and to submit their notifications.
Linking support with needs
Representatives from the United Kingdom, the EU, Canada, Sweden and Japan highlighted on 4 March the trade facilitation implementation support they were currently providing. Sweden’s WTO ambassador Daniel Blockert said there were lots of programmes in place and lots of funds available to assist developing countries and LDCs with implementation. The challenge for potential recipients is to track down the programmes, he said, which underscored the importance of national focal points.
Bill Gain, Global Program Manager with the World Bank, noted that the Bank’s support for trade facilitation-related projects increased from US$ 322 million in 2004 to US$ 7 billion in 2015. Fifty countries have already requested assistance under the Bank’s Trade Facilitation Support Program (TFSP), which assists developing countries in reforming and aligning their trade facilitation laws, procedures, processes and systems to enable implementation of the TFA.
Several speakers highlighted the importance of existing initiatives such as TradeMark East Africa, which has been credited with substantially reducing the costs and time for overland shipping in the region, as well as new initiatives such as the Global Alliance for Trade Facilitation, a public-private platform that seeks to use private sector expertise and resources to support trade facilitation reforms.
Emphasis was also placed on the role of the WTO’s Trade Facilitation Agreement Facility (TFAF) to support the ultimate goal of full implementation of the Agreement by all members. The Facility was formally launched on 22 July 2014 by WTO Director-General Roberto Azevêdo to help developing and LDC members assess their specific needs and to identify possible development partners to help them meet those needs.
Background
Concluded at the WTO’s 2013 Bali Ministerial Conference, the TFA contains provisions for expediting the movement, release and clearance of goods, including goods in transit. It also sets out measures for effective cooperation between customs and other appropriate authorities on trade facilitation and customs compliance issues. It further contains provisions for technical assistance and capacity building in this area.
The Protocol of Amendment inserting the TFA into Annex 1A of the WTO Agreement was subsequently adopted by the General Council on 27 November 2014. This in turn opened the door for members to formally ratify the TFA through their domestic legislative procedures.
The TFA broke new ground for developing and least-developed countries in the way it will be implemented. For the first time in WTO history, the requirement to implement the Agreement was directly linked to the capacity of the country to do so. In addition, the Agreement states that assistance and support should be provided to help them achieve that capacity.
The TFAF was also created at the request of developing countries and LDCs to help ensure that they receive the assistance needed to reap the full benefits of the TFA and to support the ultimate goal of full implementation of the new agreement by all members.
The PCTF is responsible for ensuring the expeditious entry into force of the Agreement and to prepare for the efficient operation of the Agreement upon its entry into force.
Implementation of the WTO Trade Facilitation Agreement has the potential to increase global merchandise exports by up to US$ 1 trillion per annum, according to the WTO’s flagship World Trade Report released on 26 October 2015. Significantly, the Report also found that developing countries will benefit significantly from the TFA, capturing more than half of the available gains.
More information on the WTO and trade facilitation is available at www.wto.org/tradefacilitation.
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“Lighting up and Powering Africa”: AfDB puts energy on the front burner of Africa’s development agenda
Energy is the central theme of the African Development Bank’s 2016 Annual Meetings as well as its 2015 Annual Report. The theme, “Energy and Climate Change”, underscores the importance the Bank attaches to energy, which the AfDB President, Akinwumi Adesina, describes as “the lifeblood of any society and the passport to economic transformation.”
Thus, energy is at the top of the Bank’s High 5 priorities – Light up and power Africa, Feed Africa, Industrialise Africa, Integrate Africa and Improve the quality of life for Africans.
Generally, there is a consensus that the availability of quality energy serves as a barometer for measuring living conditions in a given place. Available data indicates that over 640 million people in Africa, more than half of the continent’s population, do not have access to electricity. This situation persists despite the fact that the continent is endowed with inexhaustible raw energy potential.
Africa’s energy needs are so huge that efforts being made in the sector often appear like drops of water sprinkled in the Sahara Desert. The AfDB’s current energy portfolio hovers around US $11 billion, with lending to energy sector projects (public and private) exceeding an annual US $1 billion in recent years. Over three-quarters of the energy portfolio supports public sector projects. The portfolio is composed largely of generation projects, as well as distribution projects, and support for regional energy interconnections.
In addition, the Bank is leading and hosting many energy-related initiatives and organisations such as the Sustainable Energy for All (SE4ALL) Africa Hub in partnership with the African Union Commission, the New Partnership for Africa’s Development (NEPAD) Agency, and United Nations Development Programme (UNDP). It also hosts the Secretariat to the African Energy Leaders Group (AELG). It is one of the architects and a key financier of the Programme for Infrastructure Development in Africa (PIDA). The Bank is actively engaged in the new Africa Renewable Energy Initiative, and is expected to play a key implementation role. It cooperates with key stakeholders in the energy sector, such as the World Bank Group, European Commission, bilateral donors including the US (especially through the Power Africa Initiative), the UK, France, Germany, and the International Renewable Agency (IRENA), among others.
The AfDB is also financing large energy projects across the continent. These include the first phase of Morocco’s Noor-Ouarzazate concentrated solar power (CSP) complexwith over 500 megawatts (MW) installed capacity, which received US $400 million in funding. The Bank is also investing €1.86 billion in South Africa’s Medupi Power Station Project, which has a total capacity of 4 800 MW, and considered to fourth-largest coal plant in the southern hemisphere.
In Central Africa, there are ongoing efforts to add a third dam (Inga III) of 4.8GW. Under the Grand Inga continental flagship project, a multi-phase hydro power station is to be built on the Congo River, with the potential to generate approximately 44 GW – half of Africa’s current installed electricity capacity. In East Africa, Ethiopia has invested in large-scale hydropower public investments in the Beles II (460 MW), Gilgel Gibe II (420 MW), Gilgel Gibe III (1.87 GW) and the Grand Renaissance (6GW) dams. The Lake Turkana Wind Power Project, which will be one of the largest wind farms in Africa, is constructing a 428-km publicly-owned transmission line needed to put 300 MW of power on the Kenyan grid.
President Adesina believes that a lot more needs to be done given Africa’s energy potential and the huge needs to be met. “Africa is blessed with limitless potential for solar, wind, hydropower and geothermal energy resources. We must unlock Africa’s energy potential – both conventional and renewable. Unlocking the huge energy potential of Africa, for Africa, will be a major focus of the Bank,” he said.
Thus, in September 2015 the Bank articulated a New Deal on Energy for Africa and launched a Transformative Partnership on Energy for Africa to light up and power Africa by 2025. The goal is to add 160 GW of new generation capacity through the existing grid, deliver 130 million new grid and 75 million off-grid connections.
It believes that the new deal will play a catalytic role in accelerating the pace of structural transformation in the energy sector. This would also enhance inclusive green growth in Africa, unlock the potential for industrialization and wealth creation. It will drive agricultural transformation and regional power pooling to integrate Africa, create jobs and ultimately improve the quality of life for Africans.
President Adesina put all of these in perspective when he presented the New Deal on Energy for Africa, and launched a Transformative Partnership on Energy at the World Economic Forum in Davos, Switzerland, on January 20, 2016.
In his address on the occasion, he cited the inclusion of energy in the United Nations sustainable Development Goals in 2015, to underscore the importance of energy to society and a key priority for the bank.
The New Deal, he said, sets the ambitious target of universal access to energy by 2025. This means bringing modern energy to 900 million people in Sub-Saharan Africa, including those who do not have access as well provide for anticipated population growth. It also implies a step change in the way that the Bank, African countries, development partners and the private sector approach the energy sector on the continent.
“To succeed, we must work together. As the African proverb says: ‘If you want to go fast, go alone. If you want to go far, go together.’ Hence, the African Development Bank is working with governments, the private sector, bilateral and multilateral agencies – several of whom are represented here – to develop a Transformative Partnership on Energy for Africa. This will provide a platform for public private partnerships for innovative financing for Africa’s energy sector,” Adesina emphasized.
African Development Bank Annual Meetings 2016
“Energy and Climate Change”
Africa is at a crucial time for its transformation toward inclusive and sustainable development. Unfortunately, the continent remains trapped in a situation of severe energy deficiency. Of all the people without electricity in the world, 53 percent are in Africa. Per capita electricity use in Africa averages 181 kWh compared to about 13,000 kWh in the United States of America and over 6,500 kWh in Europe. It also costs African people more. Africa’s poorest pay some of the highest energy costs in the world, about 60-80 times per unit more in Northern Nigeria than residents in cities of New York and London. Today, over 645 million Africans do not have access to electricity, 700 million have no access to clean cooking energy, and 600,000 die each year from indoor pollution from reliance on biomass for cooking. Energy‐sector bottlenecks and power shortages are estimated to cost about 2 to 4 percent of GDP annually, undermining economic growth, employment creation and investment. In sum, while the economic, social and environmental challenges of Africa’s energy gap are many, Africa has a considerably reduced carbon footprint. The Bank estimates energy financing needs in Sub-Saharan Africa at USD 55 billion per year, whereas developing domestic supply networks will require investments in energy networks and their upgrades.
Fortunately, potentials for cleaner energy in Africa are enormous, including natural gas, hydro, solar, wind and geothermal power: the continent has untapped renewable energy resources which could deliver levels of supply in excess of domestic consumption to 2040 and far beyond. Also, the just ended UN Conference on Climate Change (COP21) has demonstrated Africa’s commitment in joining the global fight against climate change and elimination of energy poverty through the submission of Intended National Determined Contributions (INDCs) by African countries to the UNFCCC.
The African Development Bank has announced the New Deal on Energy for Africa and launched a Transformative Partnership on Energy for Africa to light up and power Africa by 2025, while decoupling Africa’s economic productivity from carbon dioxide emissions. The goal is to add 160 GW of new generation capacity via the grid, deliver 130 million new grid connections and 75 million off-grid connections. The Bank’s New Deal will play a catalytic role in accelerating the pace of structural transformation in the energy sector for inclusive green growth in Africa, unlocking the potential for industrialization and wealth creation, agricultural transformation and regional power pooling to integrate Africa, job creation, and ultimately improving the quality of life for Africans.
In this context, the choice of the theme of the 2016 edition of the Bank’s Annual Meetings, Energy and Climate Change, is timely to facilitate global mobilization for the emergence of a new Africa: a lighted up and powered Africa.
Under the theme, the Annual Meetings will focus on at least three major concerns. Firstly, the debates will focus on the role of the New Deal on Energy and on the Africa Renewable Energy Initiative (AREI) to eliminate energy poverty. Secondly, the theme paves the way for debating the implications of the Paris Agreement and the INDCs on Africa. Thirdly, the Annual Meetings will focus on how the Energy and Climate Change issues will influence implementation of the High 5s priority areas of the Bank, namely – light up and power Africa, feed Africa, industrialize Africa, integrate Africa, and improve the quality of life in Africa – as charted by AfDB President Akinwumi Adesina.
The organization of the 2016 Annual Meetings will serve as the voice for all, through bringing together all African and external actors – governments; civil society; vulnerable groups, such as the youth and women; the private sector, whose role remains pivotal; and all technical and financial partners of Africa – to share ideas and experiences on mapping the future of Africa in an inclusive and sustainable way.
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Botswana set to benefit from AGOA
Botswana is one of several countries with limited success in utilizing the preferential market under the United States’ African Growth and Opportunity Act (AGOA), it has emerged.
Acting Trade Minister, Sadique Kebonang told parliament that the country will develop new strategies during the 2016/17 financial year to better take advantage of opportunities under the Act.
These strategies are expected to strategically increase competitiveness and diversification of beneficiary exports to the United States, Kebonang said
Kebonang said after years of implementation, there is evidence that AGOA has resulted in a substantial increase in exports from Sub-Saharan Africa to the US.
Between 2001 and 2014, exports from AGOA-eligible countries increased by threefold from $1.3 billion to $4.4 billion.
In spite of these impressive statistics, Kebonang acknowledged that only a few countries have taken advantage of AGOA while the products coverage under of these countries’ exports to the US still remain limited.
AGOA is a unilateral trade preference between the United States and African member states that was signed into law in 2000, for a period of eight years. It expired in 2008 and was extended to September 2015. In 2008 Botswana’s exports to the US was $15million compared to Lesotho, which exported goods worth $350 million through the AGOA scheme.
In 2011, the export levels stood at US $15 million for the textiles and apparel, diminishing to US $10 million as at December 2012.
The president of Botswana Exporters and Manufactures Association (BEMA), Nkosi Mwaba said the government need to introduce incentives like duty incentives, rebates, and sourcing of raw materials.
The number of companies participating in the scheme has also decreased over the years. For Botswana, the AGOA comprises of 6,400 product lines, but the country’s textile and garment sector has been the beneficiary of AGOA over the years.
“We appeal to government to introduce incentives that will ensure competitiveness and sustainability of the sectors. We recognize the stimulus packages that government has extended to the textile industry however these are temporal solutions. As manufactures we solicit for incentives that will make Botswana export competitive globally,” said Mwaba.
Since inception of AGOA, Botswana managed to participate in about eight sectors in agriculture, machinery, minerals metals, textiles apparel, chemicals, forestry, transport equipment and electronic products.
Although African countries benefit individually from the African Growth Opportunity Act, Botswana is likely to reap the rewards if the US can carry out its threat of suspending South Africa from the programme, a senior government official was recently quoted as saying by the Daily News.
South Africa has until next month to comply with the US demands to open its market for US poultry, failure to which the US would suspend duty-free treatment to all AGOA-eligible goods in the agricultural sector from South Africa.
AGOA is a unilateral trade arrangement by the US for Sub-Saharan Africa.
Ontlametse Ward, the deputy permanent secretary in the Ministry of Trade and Industry, told media that if South Africa was suspended, it could be to Botswana’s advantage as companies producing for the US market could come and set up shops in the country in order to benefit under AGOA. Botswana, she said, does not have a bilateral trade agreement with South Africa, but that the two countries were members of the Southern African Customs Union (SACU) hence they enjoy trading with each other on a duty free basis for all goods through the 2002 SACU agreement.
The ministry trade and industry is expected to conduct a countrywide workshop to sensitize the public, especially the private sector on the opportunities of the new AGOA in 2016/2017.
Of the 13 companies that have been exporting to US under AGOA, only one remaining due to challenges linked to high transport and logistic costs, inadequate capacity and stringent US regulations on sanitary and phyto-sanitary measures on agricultural products.
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David Lipton: Policy imperatives for boosting global growth and prosperity
Speech by David Lipton, First Deputy Managing Director, IMF, at the National Association for Business Economics in Washington, D.C., 8 March 2016
Let me start by thanking the National Association for Business Economics and Tom Beers for inviting me to speak to you today.
At the recent G20 meeting in Shanghai, countries recognized the challenges facing the world economy, acknowledged that the recovery remains too weak and uneven, and recognized the downside risks. The meeting’s message provided some reassurance that countries stand ready to act if necessary. Today I want to make the case for action now.
The IMF’s latest reading of the global economy shows once again a weakening baseline. Moreover, risks have increased further, with volatile financial markets and low commodity prices creating fresh concerns about the health of the global economy.
These concerns are partly being fed by a perception that policymakers in many economies have run out of ammunition or lost the resolve to deploy it. For the sake of the global economy, it is imperative that advanced and developing countries dispel this dangerous notion by reviving the bold spirit of action and cooperation that characterized the early years of the recovery effort.
What is needed is a three-pronged approach through monetary and fiscal policies, as well as structural reforms to strengthen the baseline and guard against the risks. In addition, collective global action should play a supporting role in helping leverage individual country action and seeking to make the international monetary system more stable and hence supportive of growth.
1. Global Economic Outlook
What do we know so far?
The weak recovery is taking place in the context of unresolved legacies. In many parts of Europe, for instance, sovereign and private sector balance sheets remain highly leveraged and banks’ non-performing loans high. In the US, aging-related spending pressures and unfulfilled infrastructure needs diminish economic prospects. And in Japan, deflation is putting the recovery at risk.
At the same time, we are witnessing an emergence of new risks. The global economic slowdown is hurting bank balance sheets and financing conditions have tightened considerably. In emerging markets, excess capacity is being unwound through sharp declines in capital spending, while rising private debt, often denominated in foreign currency, is increasing risks to banks and sovereign balance sheets.
Concerns about the global outlook have weighed heavily on world financial markets. The decline in equity price indices in 2016 so far this year has averaged over 6 percent, implying a loss of global market capitalization of over US$ 6 trillion (or 8.5 percent of global GDP). This is roughly half the US$ 12.3 trillion loss incurred in the most acute phase of the global financial crisis. Some Asian markets, such as in China and Japan, have been particularly hard hit, with losses of over 20 percent since the beginning of the year. Meanwhile, emerging market currencies have weakened, while their sovereign credit spreads have continued to widen – in Latin America and Africa by over 300 basis points over the past year.
What may be most disconcerting is that the rise in global risk aversion is leading to a sharp retrenchment in global capital and trade flows. Last year, for example, emerging markets saw about $200 billion in net capital outflows, compared with $125 billion in net capital inflows in 2014. Trade flows meanwhile are being dragged down by weak export and import growth in large emerging markets such as China, as well as Russia and Brazil, which have been under considerable stress.
Furthermore, inflation has fallen to historical lows. Headline inflation in advanced economies in 2015, at 0.3 percent, was the lowest since the financial crisis, and in emerging markets core inflation remains well below central bank targets.
Why should we be concerned about these developments?
First, because protracted low global demand, and adverse feedback loops between the real economy and markets may generate additional deflationary pressures, putting us at risk of secular stagnation. Second, and equally relevant, is that labor supply and labor productivity growth have fallen considerably over the past decade, further aggravating these adverse dynamics.
While some aspects of the weak recovery are clear, we and many others in the policy world and in the markets are still debating and analyzing the role and the severity of several key transitions now underway:
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How will China’s transition – with the deceleration in export oriented manufacturing activity and a pickup in sectors satisfying household demand – alter patterns of global trade and investment?
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Will the transition to lower oil and commodity prices be a plus, as predicted, or a minus? The expected pickup in consumption in commodity importers has been weaker than expected, possibly reflecting continued deleveraging in some of these economies and a limited pass-through of price declines to consumers. At the same time, declining prices have reduced investment in extractive industries, pushed some producers to or beyond the edge of profitability, and weighed on growth prospects for commodity exporting countries.
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Will geopolitical tensions, the related refugee crisis, and global epidemics further increase uncertainty and weigh on economic activity?
With all these uncertainties, even our latest baseline for global growth may no longer be applicable. In any case, the downside risks are clearly much more pronounced than before, and the case for more forceful and concerted policy action, has become more compelling.
2. Policy priorities
Let me turn to three realities of the present situation.
(i) The inescapable task of building resilience in emerging markets
Emerging markets face the task of reducing vulnerabilities where those have built up, and rebuilding resilience to deal with what may come.
Commodity exporters need to recognize that commodity prices may well be permanently lower. Fiscal buffers can help smooth the adjustment to lower commodity prices, but it will be important to plan for more resilient fiscal models by upgrading the efficiency of spending, strengthening fiscal institutions, and increasing non-commodity revenues.
Exchange rate flexibility, where feasible, should be used to cushion the impact of adverse shocks these countries are facing. Macro prudential tools should also be employed to mitigate risks, for instance by raising provisioning requirements on risky loans, and ensuring adequate safeguards are in place to cover banks’ foreign exchange exposures.
While many commodity importers have benefited from reduced inflation, monetary easing may be constrained by tighter external financing conditions, and in some cases, still high inflationary expectations. In many cases, these countries will be well served by strengthening public and private sector balance sheets by pressing ahead, for instance, with energy subsidy reforms and addressing corporate sector vulnerabilities.
(ii) Only positive sum policies will strengthen global growth
History has taught us a few things not to do. We need to avoid negative sum and zero sum economic policies. We know that restrictive policies on trade and capital flows are suboptimal and in the long run will make all countries worse off. And we know that competitive devaluations are a zero sum game, since they merely switch demand from one country to another.
To avoid this, countries should bolster aggregate demand, not just attract it from abroad. That does not mean abandoning accommodative monetary policy where inflation is too low and slack is too high, just because it has been pushed to extremes. Premature withdrawal of monetary support would not only undermine policy credibility, it would risk precipitating the very outcome we all wish to avoid. It would lower aggregate demand and increase the degree of slack in the global economy. As a result, the world could fall into deflation, whose vicious and self-reinforcing dynamics – in the form of higher real interest rates, falling nominal GDP, worsening public debt ratios, and rising unemployment – are notoriously difficult to combat once they become entrenched.
However, with negative policy rates taking hold in some countries, the scope for monetary policy to boost domestic demand further is limited, so its remaining potency may lie mainly in weakening currencies and attracting demand from the rest of the world in a way we should avoid.
Therefore, fiscal policy has to take a more prominent place in the policy mix. Here I am thinking of two aspects: first, making fiscal policies more growth-friendly, by changing the composition of budgets; second, countries with fiscal space should use it to boost infrastructure investment, for example. This is particularly the case in advanced economies given, as I said a moment ago, that the need to build resilience in emerging markets will in many cases require sustained adjustments that will likely prove pro-cyclical. So, the burden to lift growth falls more squarely on advanced economies.
Let me develop the case for thinking again about fiscal policy. We know that infrastructure investment can be particularly beneficial, not only because it is deeply needed in some advanced economies, but as it has positive spillover effects to the rest of the economy. Raising wages and tax cuts to promote spending can also be effective, particularly in countries that have current account surpluses. These need to be carefully designed and directed to those that are most likely to spend the proceeds. Measures to reduce debt bias in favor of equity through tax incentives can also be effective in promoting growth, while reducing leverage.
Of course, given the highly uncertain outlook we need to balance risks to public debt against those to growth. Such a risk management approach argues for a dynamic assessment of the potential use of fiscal policy: what will be the evolution of debt and GDP along the present trajectory, accounting for risks of further slowdown and stagnation versus what risks will be avoided and growth ensured with a more forceful approach. We see valuable potential for pre-empting risks and spurring growth at this critical stage of the global recovery. Combined with monetary accommodation supporting continued low interest rates as well as the beneficial impact on growth, the near term impact on debt would be manageable in some advanced economies, as well as selectively within the G-20.
(iii) Without structural reform long run growth prospects will be inadequate
In tandem with demand-side policies, we need to strengthen supply. Both advanced and emerging market economies have to redouble their efforts to raise potential output through structural reforms.
We know that structural reforms are often times politically difficult to implement and can take time to produce results. Moreover some reforms may idle resources for a transitional period and temporarily add to slack when that is undesirable. It is therefore important to prioritize reforms, while tailoring efforts to country circumstances.
With this in mind, we have found that lowering barriers to entry in product and services markets can be particularly effective as they deliver gains already in the short run. Furthermore, fiscal structural reforms in labor markets, such as reductions in labor tax wedges, can be particularly effective during periods of economic slack, as they usually entail some degree of fiscal stimulus.
More is also needed to foster innovation – by removing barriers to competition, cutting red tape, enhancing labor mobility, and investing more in education and research. This is key to raising entrepreneurship, productivity and potential output. For the same reason, technological sharing need to be encouraged by, for instance, removing barriers to foreign direct investment.
These are just some examples where we think progress is urgently needed. Other key areas include further integrating capital markets, reforming state owned enterprises, enhancing corporate governance and transparency, improving public investment efficiency and removing impediments to private investment.
A three-pronged approach
So, in sum, a three-pronged approach of monetary, fiscal, and structural policies is needed. Together with bank repair, where needed, and with proper targeting on infrastructure, this approach would create jobs, and likely reduce public debt-to-GDP ratios in the medium term by stimulating nominal GDP, and supporting credit and financial stability. By strengthening the global outlook, such coordinated action would speed up healing in the banking sector and forestall contingent liabilities for governments that loom in the face of inaction. It would also have substantial positive spillovers to vulnerable emerging economies, including commodity exporters that may not be able to participate directly in the fiscal expansion.
3. Need for a global approach to action
Acting collectively to leverage impact
In addition to country action, concerted action is required to go from zero sum to positive sum and avoid secular stagnation. I am thinking here, for instance, of promoting better trade integration through multilateral trade initiatives. The Trans-Pacific Partnership is a significant and welcome initiative but further trade integration is needed on a global basis. The challenge now is to establish a clear path forward for the multilateral trade system, post-Doha, to advance integration at a global level.
Collective efforts are also needed to further strengthen the global financial system. New financing mechanisms to address risks by commodity exporters and emerging markets that have strong fundamentals but are susceptible to shocks are needed. Broadening the web of central bank swap lines to include a wider range of well managed advanced and emerging markets could fill an important void, while reducing the need for emerging markets to hold excess reserves. This capital could be put to better use for much-needed investments in infrastructure, education and health.
At the IMF, we will need to revisit how we can help strengthen and broaden our global precautionary financing instruments so that they can work for all. We will also be taking another look at policies to address financial account risks, including macro-prudential and capital flow management measures. Moreover, the regulatory reform agenda needs to be completed, including strengthening regulation and supervision of financial activities outside the banking sector.
4. Conclusion
These are the key messages that I wanted to convey to you all today. Global economic recovery continues, but we are clearly at a delicate juncture, where risk of economic derailment has grown. Again, I think that at the recent G20 meetings in China there was broad recognition of these risks and priorities.
Now is the time to decisively support economic activity and put the global economy on a sounder footing. This requires some tough choices, with advanced economies in particular needing to step up to the plate through the three-pronged approach I have described, as well as measures to make the global financial system more efficient and resilient.
Winston Churchill said, “I never worry about action, but only inaction.” This is one of those moments where action – concerted action – is needed.
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WTO Committee on Sanitary and Phytosanitary Measures: Communication from the African Union Commission on SPS-related activities
This report has been prepared for the Formal Meeting of the World Trade Organisation Committee on Sanitary and Phytosanitary (SPS) Measures, 16-17 March 2016.
AUC SPS RELATED-ACTIVITIES
The African Union Commission (AUC) organized the Africa Day for Food and Nutrition Security (ADFNS) from 28-30 October 2015 in Kampala, Uganda. One of the side events for the occasion focused on promoting trade and the consumption of nutritious, safe and diverse diets in Africa. During the occasion, the Global Panel on Agriculture and Food Systems for Nutrition launched the Africa Nutrition and Biofortification Policy Briefs as well as discussions of concrete steps towards attaining food security, improved nutrition and market access through integrated aflatoxin control action plans and roadmaps, increasing production, availability and access of nutrient dense crops and animal products and improving access to markets for small holder farmers, particularly women farmers.
The first meeting of the Continental Committee meeting for Africa was held on 29 October 2015 in Kampala, Uganda. The meeting was convened in the margins of the Agriculture Day for Food and Nutrition Security (ADFNS) commemorated on 30 October 2015. The committee members first participated in the Pre-events of the ADFNS of 28 October 2015. The meeting was attended by member of the Continental SPS Committee from the Regional Economic Communities (RECS), international organizations (FAO, OIE and ECA) and the African Development Bank and other departments of the African Union; namely Trade and Industry and Social Affairs.
The objective of the meeting included the following:
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Consolidate and sustain the momentum of operationalizing the Committee;
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Review the action points from previous meeting;
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Brief members and organizations represented to share information;
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Identify areas of support;
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Review working documents; and
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Plan for 2016.
An overview of Agenda 2063; Africa's agenda for economic development and transformation for the next 50 years from 2013 was presented to the meeting. The presentation focused on the Ten-Year Implementation plan highlighting the niche for SPS issues in the plan.
The strategic matters arising out of the Malabo Declaration was also presented to the meeting focusing on the Implementation Strategy and Roadmap for achieving CAADP vision 2025 and the CAADP Results framework developed to track contribution and delivery on the commitments.
The in-depth presentation and discussion on the commitment on Boosting IntraAfrican Trade in goods and services was led by the Department of Trade and Industry. The presentation focused on the launching the Continental Free Trade Area (CFTA) Negotiations. The role of the Continental SPS Committee was underscored in contributing to the CFTA negotiations forum and particularly in supporting the work on the Technical Group on TBT and SPS.
The Terms of References (ToR) for the Continental SPS Committee was presented for further reflection. The ToR was discussed at length and reaffirmed as the overarching framework for guiding and operationalizing the work the Committee. There was a general consensus that the ToRs that eventually constituted the entire agenda of the meeting is recast to reflect the input of the members of the committee and shared with all members. It was noted in discussing the ToR that while a lot of excellent SPS work has been done and is on-going, more has to be done to realise the full potential of different organizations in view of Malabo Declaration so that the committee established becomes even more dynamic and efficient to fully achieve commonly defined objectives. The meeting thus provided the opportunity to pursue these discussions. Reference was made to the reactivation of the discussions on developing a guideline document to facilitate mainstreaming SPS in various strategic documents existing; notably the National Agricultural Investment Plans (NAIPS) and the Regional Agricultural Investment Plans (RAIPs). The meeting was an occasion for members to reflect the priorities of the ToR in which members exchanged ideas on the architecture and content of the ToR, as well various elements that would enable the members of the committee work efficiently.
Changes were made to this section of the TOR. Initially, the responsibilities were fifteen in number but following consensus by members of the Committee, they were categorized under three broad areas which include:
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Capacity development;
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Coordination and harmonization; and
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Policy guidance and advocacy.
The AUC organized a capacity building workshop and capacity needs assessment for CFTA negotiators in reparations for, and in the margins of the CFTA negotiations forum. The course addressed how to support a multilateral trade negotiation process from both an operational and strategic perspective with full simulation exercise on what may happen as part of the commencement of the CFTA negotiations. The findings from selected technical studies on the establishment of the CFTA were also shared and discussed with AU member States. The draft CFTA-NF Rules of Procedure was presented for consideration and adoption. The forum further considered the information requirement to prepare and facilitate negotiations and the work plan and schedule of negotiations presented by the secretariat.
AU-IBAR SPS RELATED ACTIVITIES
Animal Health
Meeting of African animal health experts to analyze and comment on OIE proposed changes to the Terrestrial and Aquatic Animal Health Codes held in December 2015 for the meeting of the OIE Code Commissions in February 2016. The meeting led to identification of animal health issues of common interest to African countries and proposition of coordinated positions.
The 8th Panafrican meeting of Chief Veterinary Officers on Africa's coordinated position on animal health standards will take place in Nairobi, Kenya from 26 to 28 April 2016. This annual meeting is also to prepare strategic attendance of African OIE Delegates to the 84th Session of the World Assembly of OIE Delegates in May 2016 in Paris, France.
Food Safety
February 2016: AU-IBAR organized an African food safety expert's consultation on contaminants in food and on food additives in Nairobi to examine items of the agenda items of the Codex Committee on Contaminants in Food for its 10th session, and on Codex Committee on Food Additives for its 48th session.
In March 2016, AU-IBAR organized an African food safety expert's consultation on pesticide residues and on general principles in Nairobi to examine items of the agenda items of the Codex Committee on Pesticide Residues for its 48th session, and on the Codex Committee on General Principles for its 30th session. The meetings of food safety experts are to provide scientific advice to African Union member States in collaboration with the Coordinator of CCAfrica during their preparation of national positions. This is an effort of African Union to improve the effective participation of its member States in the work of the Codex Alimentarius Commission.
47th Session of the Codex Committee on Food Hygiene (Boston, USA): AU-IBAR sponsored the attendance of eight African delegates to participate in the meeting.
From 21 to 23 December 2015, a regional workshop on the establishment of a network on SPS and Food safety for ECOWAS member countries was held in Dakar, Senegal and organized by AU-IBAR under the scope of the project Participation of African Nations in the Sanitary and Phytosanitary Standard Setting Organizations (PANSPSO-Project). The meeting aimed to establish a network of ECOWAS countries that are involved in sanitary and phytosanitary and food safety activities and create a synergy of actions in this domain.
And specifically:
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To strengthen national Codex Alimentarius Committees;
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To enhance the participation of countries in the various meetings of the Codex Alimentarius Commission;
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To create synergy of actions to pursue a coherent and harmonized policy of food safety in line with the concerns of the West African region.
Over fifty participants at the workshop were National Codex Contact Points and officials of ministries in charge of Codex, actors performing important functions relating to sanitary and phytosanitary issues, representatives of consumers associations. Fourteen African Delegates from Benin, Burkina Faso, Côte d'Ivoire, The Gambia, Ghana, Guinea, Guinea Bissau, Liberia, Mali, Niger, Nigeria, Senegal, Sierra Leone, Togo, five observer organizations were in attendance namely the Economic Council of Senegal representative, a member of the Parliament, Representative of Luxemburg's Embassy, representative of France's Embassy, FAO, WHO, African Union Commission (department of DREA and Social Affairs), ECOWAS, UEMOA.
AU-IBAR supported a workshop on the strengthening and revitalisation of the National Codex Committee (CNCC) of Ethiopia on 7 and 8 December 2015 in Addis Ababa, Ethiopia.
Objectives:
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Improve the understanding of the participants of the workshop on the standards setting procedures of CAC; and
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Enable the participants of the workshop to have a better understanding of the CAC.
Expected outcomes were:
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Participants of the workshop demonstrate their capacities to effectively participate and contribute to the standards setting procedures of CAC; and
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The NCC has in place a functional national SPS action plan and a road map to revitalize the NCC in Ethiopia.
SPS ACTIVITIES
AU-IBAR Workshop on the Transparency Provision and on Improvement of the Participation of African Delegates in the Meetings of the SPS Committee
The African Union Interafrican Bureau for Animal Resources (AU-IBAR) in its effort to improve participation of African countries at the WTO SPS Committee meetings and implementation of SPS Agreement has been providing technical assistance in the form of capacity building on SPS matters and providing financial assistance in supporting African delegates to attend the SPS Committee meetings in Geneva, Switzerland. A total of 25 African delegates were sponsored by AU-IBAR to participate in the 64th session of the SPS Committee in October 2015.
The focus on improved participation of African countries in the activities of the SPS Committee includes:
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Inclusion of African countries participation in SPS Committee meeting activities on the agenda also commonly known as the WTO airgram;
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Improved notifications from African countries to the WTO Notification Submission System (NSS) through National Notification Authorities (NNA);
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Enhanced capacity of the African countries to resolve trade disputes in the SPS Committee meetings; and
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A united African approach and support system during the sessions of the SPS Committee meetings on SPS matters discussed and presented.
Following an agreement between African Union and the Secretariat of the SPS Committee, the AU sponsored delegates participated in the two-day workshop on transparency organized in Geneva from 12 to 13 October 2015.
The efforts of AU-IBAR in providing technical assistance in the form of capacity building and financial assistance to enable African countries to participate in the WTO SPS Committee meeting has produced tangible results which will go a long way in improving the participation of African countries. The participation of African countries has tremendously improved. The initiative has created a united African country support system and also empowered African Delegates in resolving trade disputes at the WTO SPS Committee meetings.
AU-IBAR Workshop on Capacity Building in Agriculture Trade Issues
The capacity building workshop organized by AU-IBAR was held, in Nairobi from 16 to 17 December 2015 in the margins of the 10th Ministerial Conference of WTO.
The topics of focus were as follows:
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Agriculture negotiations;
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The Doha mandate and development agenda;
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The Agreement on Agriculture;
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Technical barriers to trade; and
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Trade facilitation.
The trainers were competent national officers who have received training from AU-IBAR and/or WTO.
The objectives of the workshop were to:
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Improve knowledge and understanding by participants of the provisions of the Agriculture negotiations Agreement of the WTO;
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Improve knowledge and mastering of the technical barriers to trade;
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Improve knowledge and mastering of the trade facilitation; and
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Enhance the capacity of African countries to resolve trade issues using the provisions of the SPS Agreement.
Participants were officers from Ministerial Departments in charge of Commerce, National Notification Authorities and National Enquiry Points who have attended trainings organized by AUIBAR and/or WTO from member States of the African Union.
A total of 33 participants attended the workshop. The workshop was officially opened by the European Union Commissioner of Agriculture and Rural Development. The workshop was highly interactive with full participation of delegates who decided to seek more collaboration with all national institutions dealing with SPS matters in order to comprehensively address national SPS matters.
Related News
SADC Report to the World Trade Organisation Sanitary and Phytosanitary Committee Meeting on SPS Activities
This report has been prepared for the Formal Meeting of the World Trade Organisation Committee on Sanitary and Phytosanitary (SPS) Measures, 16-17 March 2016.
Workshop on Food Safety Awareness Creation
SADC Secretariat facilitated a workshop on Food Safety Awareness creation for the private sector. This workshop was held in Lusaka, Zambia from 20-21 January 2016. The goal of the workshop was to broaden the understanding of the food safety issues by the private sector so as to enhance their participation in the development and implementation of food safety standards for improved safe regional and international trade in food. Participants included representatives of farmers associations, retailers associations, manufacturers association, consumers associations and farmers. The workshop was sponsored by European Union (EU) through Regional Economic Integration Support (REIS) programme.
Participants and workshop facilitators shared their national experiences in the implementation of food safety control systems. It was strongly agreed that national food safety regulators should collaborate with the private sector in order to ensure that food safety standards are equally implemented for both domestic and international trade.
Study on Identification of Sanitary Measure Hindering Regional Trade
SADC Secretariat commissioned a regional study in January 2016 to identify sanitary measures hindering trade in veterinary medicines, vaccines, animals and animal products so that they can be harmonised. The study covered seven member States namely: Botswana, Malawi, Mozambique, Namibia, South Africa, Tanzania and Zimbabwe.
The end of assignment report is being compiled by the consultants.
Meeting on Preparation for the 22nd Session of the Codex Committee on Food Import and Export Inspection and Certification Systems (CCFICS)
SADC Secretariat with support from the Food and Agriculture Organisation (FAO) facilitated a preparatory meeting for the 22nd Session of CCFICS. The meeting was held in Lusaka, Zambia from 26-29 January 2016.
The objectives of the meeting were to: improve the quality and effectiveness of participation of SADC member States in the meeting of the CCFICS; provide a forum for knowledge and experience sharing; and come up with a regional position on the agenda items to be discussed during the CCFICS meeting through a common understanding of issues.
Sanitary and Phytosanitary Information Management System Training
SADC Secretariat facilitated a regional SPS Information Management Systems Training Workshop focusing on the national notification authorities (NNA) and national enquiry points (NEPs) in Pretoria, South Africa from 16-19 February 2016. The goal of this workshop is to contribute to improved intra-regional and international trade in food and agro-products through the implementation of the transparency provisions of WTO-SPS Agreement as mirrored in the SPS Annex to the SADC Protocol on Trade.
The workshop was sponsored through EU-REIS programme.
All SADC member States participated in the workshop with representation from food safety, animal and plant health NEPs and Ministry of Trade for NNAs.
Regional Management of Fruit Flies
An FAO supported regional Technical Cooperation Programme (TCP) involving three member States namely Botswana, Namibia, Zambia and Zimbabwe on regional management of fruit flies came to a closure in January 2016.
An exit strategy to ensure sustainable management of fruit flies was developed during the closing workshop held in Lusaka, Zambia from 8-9 February 2016.
Technical Cooperation Project on Food Control Systems
SADC Secretariat participated in a regional workshop sponsored by FAO. The workshop was held on 29 February to 1 March 2016 in Victoria Falls, Zimbabwe. The objective of the workshop was to improve multi-sectoral involvement in food safety control system and to improve collaboration between the national food control authorities and regional economic communities.
The workshop marked the closure of a regional TCP aimed at improving food control systems in three member States namely Lesotho, Swaziland and Zimbabwe.
The TCP focused on strengthening the capacity of National Codex Contact Points and National Codex Committees.
Related News
tralac’s Daily News Selection
The selection: Tuesday, 8 March 2016
Concluding today, in Addis: a learning and validation workshop for the second edition of the OSBP Sourcebook. Partners include the AU, Nepad Agency, JICA, ICA. [OSBP Source Book, September 2011 edition]
Negotiating the CFTA: two updates
Starting tomorrow, in Accra: the ECOWAS/UNCTAD stakeholder consultation on the African Continental Free Trade Area
ECA-TWN CFTA colloquium: 'Civil society urged to scrutinise Africa’s CFTA negotiations' (UNECA)
Establishing a continental free trade area will allow African countries an opportunity to change the structure of their trade and civil society has a role in ensuring transparent and inclusive negotiations and implementation of the agreement. Speaking at the ECA–TWN colloquium on the CFTA, Mr David Luke, ECA’s Coordinator of the African Trade Policy Centre, cited ECA research which indicates that a “50% increase in intra-African trade above a 2012-baseline can be achieved by 2022 if a continental free trade is in place by 2017”. Delegates noted that for the CFTA to have a broader impact, it should be accompanied by complementary services, industrial development and agriculture sector reforms for enhancing food security, rural development, productivity and enhanced participation in agro-value-chains. Mr Luke called upon CSOs to strive for the realization of these principles using the tools of “impact assessments, audits, studies and other analytical and grassroots inputs”, as well as “engaging and mobilizing the media” to provide advocacy channels for concerns.
Today is UN Women’s Day – an infographic, two policy reports:
Women’s resilience: integrating gender in the response to Ebola (AfDB)
For the purposes of this report, particular attention is paid to women’s labour force participation (or lack thereof), as well as their access to financial services, land tenure, healthcare, and decision-making in both the home and nation. This report suggests that the EVD crisis in Guinea, Liberia and Sierra Leone has most likely impacted women in the following ways: i) increased infection rates among women because of their traditional roles as caregivers, cross-border traders, and marketers; ii) compromised the livelihoods of women marketers due to the closure of community and national markets; iii) compromised the livelihoods of women who dominate the agricultural, retail trade, hospitality and tourism sectors.
Addressing gender gaps in Africa’s labour market (ILO Africa)
In sub-Saharan Africa, over 60% of all working women remain in agriculture, often concentrated in time and labour-intensive activities, which are unpaid or poorly remunerated. Reversing the employment gender gap is a pressing priority, says a new ILO report. In some countries in sub-Saharan Africa, time-related underemployment for women is as high as 40 or 50% of total employment while women continue working fewer hours in paid employment and still perform the vast majority of unpaid household and care work.
Women at Work: Trends 2016 (UN)
The ILO report, Women at Work: Trends 2016 examined data for up to 178 countries and concludes that inequality between women and men persists across a wide spectrum of the global labour market. What’s more, the report shows that over the last two decades, significant progress made by women in education has not translated into comparable improvements in their position at work.
Financial inclusion of women in five charts (World Bank Blogs)
Code of conduct for business in the East African Community (East Africa Business Council)
By committing to this Code, we pledge to treat our stakeholders with respect, to run our businesses responsibly, to act in compliance with applicable laws and regulations, and to be actively involved in promoting integrity and corruption prevention. The EABC Code of Conduct for Business will be managed by a Code secretariat hosted by EABC. The Code secretariat will have the following duties: [Download]
EAC: 4th Annual Secretary General’s Forum for Private Sector, Civil Society and Other Interest Groups
Addressing the participants during the official closing session on 4th March, 2016, Dr Ramadhan Mwinyi, Deputy Permanent Secretary in the Ministry of Foreign Affairs, East African, Regional and International Cooperation, Tanzania noted that the forum was the best practice of how to engage dialoguing parties for the East Africa integration agenda. “This being the 4th year of consistent dialogue is testament of the commitment of all stakeholders to an all-inclusive sustained engagement in the EAC integration process,” said Dr. Mwinyi.
Kenya: Country economic memorandum - from economic growth to jobs and shared prosperity (World Bank)
As for manufacturing, the puzzle is not why Kenya does not have a manufacturing sector - it does have one - but why this sector has not been able to expand. Factors highlighted by Rodrik (2015), such as the way globalization and trade have worked to the disadvantage of African countries, are part of the story. But the economy has also struggled to develop the deep public-private networks of regulation, facilitation, skills, and infrastructure, which advanced manufacturing economies need. It is revealing that Kenya does well in sectors where networks are somewhat easier to establish, as in banking and telecom, but struggles with the more intensive network capabilities needed for modern manufacturing.
The clogged “exports engine” is what differentiates Kenya from the peer countries, in particular those outside the Africa region. Kenya’s goods exports have been relatively low within the peer group. In 2012, exports of goods were 12% of GDP, while the successful East Asian countries have been producing and exporting several times more (Figure 1.6). The weakness of the export sector has been exacerbated in recent years. Kenya was one of the few countries in the group that recorded a decline in the export-to-GDP ratio between 2005 and 2012. Several factors are suspected to be the culprits for this trend: high cost of transport (partly caused by inefficiencies in getting goods to and from Mombasa port), appreciating real exchange rate, and weak manufacturing sector. [Table of contents: Kenya’s growth story, From economic growth to jobs and shared prosperity, Raising investment through savings, Manufacturing or Services: where does the key to rapid growth lie?, Non-renewable resources for sustainable development]
Industry in Tanzania: performance, prospects, and public policy (UNU-WIDER)
Sustained and more rapid export growth of the type envisaged in the Tanzania Mini-Tiger Plan 2020 will need an ‘export push’—a coordinated set of public investments, policy reforms, and institutional changes focused on increasing the share of industrial exports from both manufacturing and tradable services in GDP. The public actions needed to achieve an export push range from maintaining a competitive real exchange rate to public investments in trade-related infrastructure and skills to institutional and regulatory reforms. A full discussion of the changes needed in Tanzania to achieve an effective export push would require a paper in itself. Here, the focus is on only two key areas—special economic zones and trade logistics. [The author: John Page] [Download]
South Africa: economic sectors, employment and infrastructure development briefing (GCIS)
Going forward, we will upscale revitalisation of local industrial parks from four to 20 locations. All these industrial parks are located in former homelands or are adjacent to large townships. This intervention will unlock economic activities and link small township businesses into established domestic and global Original Equipment Manufacturers (OEMs) supply chains. It will also focus particularly on labour-intensive sectors such as clothing, textiles, footwear and agro-processing. [South Africa current account deficit widens as exports drop (Bloomberg)]
Swaziland: Budget 2016/2017 (Ministry of Finance)
In the medium term, Swaziland Railways plans to expand the Matsapha Inland Clearance Depot, also commonly called the Dry Port, to meet the growing business which has been growing between 15 and 20% per annum. Implementation of Lothair-Sidvokodvo Connection is planned to start. This project will improve the country's access to Mpumalanga and Gauteng Provinces in South Africa. It will also help to reduce the traffic congestion at the Oshoek-Ngwenya border. It will increase cargo transportation from 6.5 million tonnes per annum to 14.6 million tonnes per annum.
Kenya: 'Discreet charms of the Budget Policy Statement' (commentary by Jason Lakin, The EastAfrican)
Promoting agriculture-climate-trade linkages in the Eastern African Community (CUTS International and partners)
Until 2019, the project will bring together, inform, train and move to advocacy action hundreds of stakeholders from the government, businesses, civil society, media, academia and farming communities. Soon, teams of national experts engaged by the project will analyse the interplay of agro-processing with climate change, trade and food security in each EAC country. Findings of their research studies will later inform sensitization, training and advocacy activities towards developing lasting policy solutions for climate-aware, trade-driven, food security-enhancing agro-processing development. The still infant agro-processing industry in East Africa has been earmarked in the EAC Industrialization Policy as having huge potential for poverty reduction, growth and regional integration. But, the region’s success in realising this potential will partly depend on its ability to factor in the ever-increasing challenges posed by climate change, and work in synergy with its own trade agenda. [Inception meeting 29 Feb-01 March, project details]
FAO report to the WTO Committee on Agriculture 2016 (WTO)
The propensity at the world level for substantially lower import bills in 2015 encompasses many of the most economically vulnerable nations, such as those in the groups of LDC Low-Income Food-Deficit Countries (LIFDCs), and those geographically situated in sub-Saharan Africa. Indeed, their food import bills appear set to decline by more than the global average, with falls ranging between 22 and 23% among these country groups. As for LDCs, lower bills would not necessarily come at the expense of volumes, as imported food quantities could rise above the previous year’s levels, in contrast to the global trend.
Urgent need to transform key food producing regions in Africa by 2025 (Phys)
The research is the first to allocate timeframes for changes in policy and practice in order to maintain production levels and avoid placing food security and the livelihoods of smallholder farmers at risk. Study lead author Dr Julian Ramirez-Villegas from the University of Leeds, who is working with the CGIAR Research Program on Climate Change, Agriculture and Food Security, said: "This study tells where, and crucially when, interventions need to be made to stop climate change destroying vital food supplies in Africa. We know what needs to be done, and for the first time, we now have deadlines for taking action." The study examines region-by-region the likely effect of different climate change scenarios on nine crops that constitute 50% of food production in sub-Saharan Africa.
Related: Jaime de Melo: 'Next steps towards a workable and effective climate regime' (E15 Initiative Blog), Ethiopian farmers need urgent assistance amid major drought, warns UN (UN), Space, markets and employment in agricultural development: findings from rural sites in South Africa, Zimbabwe, Malawi (PLAAS), 4th World Coffee Conference in Addis: inequality in global coffee market discourages farmers (Ethiopian Herald), Are China and Brazil transforming African agriculture?: open access special issue in World Development (zimbabweland), Indian dream of plentiful food from African farms runs into trouble (Daijiworld), India: Will it be an El Niño or La Niña monsoon? (LiveMint)
A glimpse behind the curtain: Consumer Price Indexes in Africa (World Bank Blogs)
Even though Africa’s poor have more pressing concerns than to fuss about the technicalities of inflation measurement, CPIs do matter for our understanding of poverty on the continent. So what are the problems with Africa’s CPIs? Poverty in a Rising Africa reviews what we know about CPIs in the region, drawing on metadata collected by the ILO and other sources. A few things stand out: [The author: Isis Gaddis]
SADC: statement by outgoing SEAC Chairperson, Prof Gerhard Tötemeyer
The USAID Southern Africa Trade Hub is in transition: an update (SATH)
The Annual Bank Conference on Africa: managing the challenges and opportunities of urbanization in Africa (13-14 June, Oxford University)
SA, Nigeria to boost trade ties? (IOL)
Eight issues that Buhari's economic summit must address (Daily Trust)
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Country Economic Memorandum: Services drive Kenya’s growth in the past decade
Since 2005, services exports in Kenya have accounted for over 50% of the increase in total exports, and are poised to overtake goods exports, says a new World Bank report launched today. Trade, transport, ICT and financial services lead the pack.
The Kenya Country Economic Memorandum: From Economic Growth to Jobs and Shared Prosperity (CEM) reviews the country’s growth: past, present and future.
Kenya’s growth model has been well-regarded for a number of reasons. Unlike most of its African peers, the country embraced the role of the private sector from the start. One major accomplishment and often under-appreciated aspect of the country’s growth story is that Kenya has lived within its means. The country has never sought or received debt relief, but has opted for better economic policy – raising revenues, liberalizing trade and the forex market.
However, there are distinct features of Kenya’s growth model that upset its growth story. Firstly, agriculture’s share in GDP declined from 26.5% in 2006 to 22.0% in 2014 while manufacturing stagnated at 11.8% of GDP on average during the same period. Secondly, growth has not been inclusive: poverty, unemployment, and informality remain prevalent.
“Reviving agriculture remains Kenya’s main pathway to poverty reduction. On jobs, improving the business environment, the education system, and reforming dated labor laws will help. On informality, the real gains come from increasing productivity in the Jua Kali sector,” says Diarietou Gaye, World Bank Country Director for Kenya.
Thirdly, economic growth has been uneven and volatility is high. Domestic shocks have had bigger and longer-lasting effects than external shocks. Hence, reducing volatility becomes primarily a question of domestic policies.
“To accelerate short-term growth, the current savings rate needs to be doubled, primarily by mobilizing domestic savings. The report also identifies three long-term growth drivers: Innovation, Oil, and Urbanization. But, underpinning these recommendations is one overarching theme; that of functioning institutions,” says Apurva Sanghi, World Bank Lead Economist and Program Leader for Kenya.
The Country Economic Memorandum is a strategic World Bank product that analyzes key aspects of the country’s economic development with the main aim of providing an integrated and long term perspective of the country’s development priorities. This particular edition of the CEM has benefitted from extensive review from various stakeholders, including the government, academia and private sector.
Kenya’s Growth Story: Past, Present and Future
The 2016 Kenya Country Economic Memorandum (CEM) takes a bird’s-eye view of Kenya’s economy, zooms in on some of the key bottlenecks, and proposes some “how-to” ideas.
Between 2006 and 2013, 72% of the increase in gross domestic product (GDP) came from services, the report notes. Expansion in services such as financial intermediation and mobile communications have also stimulated demand for other services, such as trade, according to the report.
The report also shows that agriculture, the mainstay of Kenya’s economy, and manufacturing have stagnated and have not created enough jobs for Kenya’s growing working age population. Most of the jobs are created by the informal economy and are concentrated in low-productivity areas such as trade, hospitality, and jua kali, entrepreneurs who can be hired to do just about any task.
“Improving the ease of doing business is vital for job creation and higher productivity. However, there is still a need for creating job opportunities for the rural poor, for poverty reduction and achieving shared prosperity,” said Apurva Sanghi, World Bank lead economist and program leader for Kenya. “Reviving agriculture, in particular, remains the pathway for poverty reduction.”
According to the report, accelerating growth to meet Kenya’s development goals requires technological advances and innovation that raise firms’ productivity; only a few Kenyan firms have come up with products that are actually new to the domestic market It will also require macroeconomic stability, the report says, which would boost investment and savings. As the government strives to build Kenya’s energy and transport infrastructure, the report recommends improvements in the public investment management process and better execution.
The report also highlights the opportunities from the recent discovery of oil, which opens a possibility for raising Kenya’s growth. If used prudently, the report notes that it can contribute to achieving the country’s Vision 2030 goals, and with appropriate management of resource revenues, it can generate resources that could be used to raise public investment, human capital, and productivity in the non-resource sectors of the economy.
The Country Economic Memorandum is a strategic World Bank product that analyzes key aspects of the country’s economic development, with the main aim of providing an integrated and long-term perspective of the country’s development priorities. This particular edition of the Kenya CEM has benefitted from extensive review from various stakeholders, including the government, academia and private sector.
Related News
FAO Report to the WTO Committee on Agriculture 2016
This report presents the contribution of FAO to the annual monitoring exercise of the WTO Committee on Agriculture (CoA). The report draws in large part on the latest issues of the FAO Cereal Supply and Demand Brief (February 2016), the Agricultural Market Information System (AMIS) Market Monitor (February 2016) and the FAO Food Outlook (October 2015).
As in previous years, the focus of FAO’s report to the CoA is on developments in the cost of imports of basic foodstuffs, highlighting in particular trends in food import bills of the Least Developed and Net Food-Importing Developing Countries (the LDCs and NFIDCs, respectively). In addition, it reports on developments in food price volatility and on market trends in basic foodstuffs, as well as on the fourth year of operation of AMIS.
Food import bills
The global value of imported foodstuffs is projected to drop to a five-year low in 2015. At USD 1.09 trillion, the world food import bill in 2015 would be almost 20%, or USD 262 billion, below the revised level for 2014, which had reached a record high of USD 1.35 trillion.
Several factors have contributed to bringing the cost of importing food sharply down in 2015. First and foremost, international prices for many commodities have declined substantially, bringing unit costs down. Freight rates, which are expected to remain below last year’s levels in spite of their rising in recent weeks, are also likely to contribute to a year-on-year decline in costs. In addition, the abundance of supply for many commodities in the major importing countries has lowered international demand. Imports have also been deterred due to weakening national currencies against the US dollar.
The global commodity import bills set to undergo the largest absolute declines in 2015 are those for cereal-based foodstuffs and dairy products, which are likely to fall by around USD 44 billion (24%) and USD 40 billion (40%), respectively. Considerably lower quotations compared with last year, especially in the case of dairy products, are driving bills of these food groups down, compounded by contractions in import demand. The annual decline in world expenditures on imported meat, at USD 29 billion or 19%, is also noteworthy, driven again by the combination of lower unit costs and smaller volumes. The global sugar bill could fall to a 9-year low of USD 33 billion, while a sizeable contraction is also expected in the cost of importing vegetable oils, mostly due to lower quotations.
While the bills of all foodstuffs look set to fall in 2015, global import costs of fish, vegetables and fruit and tropical beverages are showing some resilience. Exporters of these US dollar-denominated commodities have keenly met sustained global demand, facilitated by the weakness of their own currencies vis-a-vis the dollar.
The propensity at the world level for substantially lower import bills in 2015 encompasses many of the most economically vulnerable nations, such as those in the groups of Least Developed Countries (LDCs) Low-Income Food-Deficit Countries (LIFDCs), and those geographically situated in sub-Saharan Africa. Indeed, their food import bills appear set to decline by more than the global average, with falls ranging between 22 and 23% among these country groups.
As for LDCs, lower bills would not necessarily come at the expense of volumes, as imported food quantities could rise above the previous year’s levels, in contrast to the global trend. This is because shortfalls in the production of staples in many of these economically disadvantaged countries have led to procurement on the global marketplace to meet domestic needs. But this brings with it a severe burden on foreign exchange reserves, especially when international purchases are required to be paid in US dollars. Although the strong US dollar is generally beneficial to net merchandise exporters who can pay for food imports, it can prove onerous to many of the most vulnerable countries which are net importers of basic necessities, notably foodstuffs.
The Agricultural Market Information System (AMIS)
The Agricultural Market Information System (AMIS), a G20 initiative to enhance food market transparency, reduce price volatility and encourage coordination of policy action in response to market disruptions was launched in September 2011. Hosted by FAO, the AMIS Secretariat has ten member organizations: FAO, IFPRI, IFAD, OECD, UNCTAD, the UN High Level Task Force, the World Bank, WFP, WTO and the International Grains Council (IGC).
During its fourth year of operation, the AMIS Secretariat used the relatively calm situation in international commodity markets to further consolidate and strengthen the AMIS initiative. To this end the Secretariat continued its regular dialogue with national focal points for the submission of commodity balances; trained participants of the second and third cycle of the AMIS Exchange Programme; and visited selected countries to establish closer collaboration with partner institutions. These efforts produced several positive outcomes, most notably a special event on the “Food Market Outlook: An AMIS Perspective” during the October 2015 meeting of the Global Food Market Information Group, which was led by AMIS participating countries.
The Secretariat also advanced on other crucial fronts such as the estimation of stocks positions, the identification of volatility drivers and the compilation of forward-looking market indicators. Highlights include the organization of an expert workshop on improving stocks and utilization measurement in China; the design of a statistical model to detect regime changes in volatility; the launch of the AMIS Policy Database in October 2015 and a workshop hosted by IFPRI on early-warning indicators.
Important progress was also achieved in the area of capacity development. For example, AMIS helped promote the use of computer assisted personal interviewing techniques in Thailand and fostered the development of crop cutting surveys in the Philippines. Other capacity development activities moved to implementation stages in Bangladesh, India and Nigeria.
The Secretariat also devoted substantial efforts to improve its outreach, for example by expanding its main report, the AMIS Market Monitor, and completely redesigning the web presence of the initiative. In addition, all webpages now apply a responsive design, meaning that they can be viewed easily on different devices such as desktop computers, tablets and smartphones.
Market trends for key cereals
According to the latest AMIS Market Monitor (February, 2016) and Food Outlook (October, 2015), world cereal production in 2015 stood at 2.531 billion tonnes, around 30 million tonnes below the 2014 record. Early prospects for 2016 cereal crops are mixed, partially influenced by the prevailing El Niño-associated weather patterns. Under current expectations, wheat production will achieve a new record, at 736.8 million tonnes and coarse grains will decline by 31 million tonnes to 1.302 billion tonnes from last year’s high. However, unfavourable weather conditions have lowered prospects for 2015 rice production, which is now forecast at 491.8 million tonnes, down 0.5% from 2014. Based on the latest forecasts for production and utilization, world cereal stocks by the close of crop seasons in 2016 are forecast at 642.4 million tonnes, 2.5 million tonnes (0.4%) above their already elevated opening level. Wheat will account for the biggest increase, followed by maize, while rice stocks are forecast to decline by 3%. This year’s abundant supplies have resulted in continued declines in international prices for all cereals. The lower prices are not expected to stimulate trade for wheat and coarse grains, as the major cereal importing countries are holding large supplies, causing import demand to decline and the total cereal trade to contract by 2% to 368 million tonnes in 2015/16, while rice trade is predicted to rebound by 1.5% in 2016 to 45.4 million tonnes.
Wheat: FAO’s latest forecast for wheat production in 2015 (736.8 million tonnes) is slightly higher (0.5%) than the previous year. The production gains are mostly on account of higher outputs in Australia, China, Morocco, Turkey, Ukraine and the United States. World wheat trade in 2015/16 (July/June) is set to contract to 151.5 million tonnes, 5 million tonnes (or 2.7%) below the 2014/15 level. The reduction will be mainly attributed to weaker import demand in North Africa and Asia, namely Morocco, the Islamic Republic of Iran and Turkey. World wheat inventories are forecast to reach 210.7 million tonnes by the end of seasons in 2016, their highest level in 13 years. Large supplies continue to push international wheat prices sharply below their previous year’s levels and falling to their lowest levels in more than five years.
Coarse Grains: FAO’s latest forecast for world production of coarse grains stands at 1.302 billion tonnes in 2015/16, about 31 million tonnes or 2.3% below the record of last year. Maize production is forecast to reach around 1.004 billion tonnes, about a 2.7% decline from the previous year. By contrast, world barley production is forecast at 144 million tonnes, up slightly from 2014. World trade in coarse grains in 2015/16 is projected to decline to 171 million tonnes, down 2.7% from the 2015/16 record level, largely due to lower imports by several countries in Asia, namely China, Indonesia and Islamic Republic of Iran. Based on the latest forecasts for global production and utilization, world stocks of coarse grains in 2015 are forecast to rise to 265.1 million tonnes by the close of the crop seasons, 1.2% above their opening levels and their highest level since 1986/87. Large stockpiles, slowing demand, an appreciating US dollar and large supplies of feed wheat from the Black Sea region, have helped to keep downward pressure on export prices.
Rice: According to the latest figures, world rice production is forecast at 491.8 million tonnes in 2015/16, 0.5% lower than the previous year due to unfavourable weather conditions. International trade in rice is predicted to rebound by 1.5% in 2015/2016 to 45.4 million tonnes, almost matching the 2014 record. Rice inventories ending in 2016 are forecast to decrease for the first time in eleven years. However, their volume is projected to be sufficient enough to cover a third of the 2015/16 projected rice consumption.
Food prices
The FAO Food Price Index averaged 150.4 points in February 2016, down almost 3 points (1.9%) from December and as much as 29 points (16%) below January 2015.
Among the sub-indices, sugar and dairy decreased the most, followed by cereals, oils and meat. The US dollar’s appreciation continued to weigh on international commodity prices. The real food price index in 2016 dropped almost 12 points or 9.6% compared to 2015.
The FAO Global Food Consumption Price Index tracks changes in the cost of a global food basket as portrayed by the latest FAO world food balance sheet. Representative international prices for each of the commodities or commodity groups appearing in the balance sheet are weighted by their contribution to total calorie intake. The index has fallen almost uninterruptedly since March 2014, losing considerable further ground in recent months. The overall decline is less pronounced when compared to the FAO Food Price Index (FPI). This is because international prices of foodstuffs that carry a much higher weight in trade than typical consumption have fallen at a much greater pace (most notably livestock products and especially dairy).
Price volatility
International price volatility can have serious implications for LDCs and NFIDCs that depend on imports to meet their domestic food needs, through a deterioration in their balance of payments, public finance and harming consumers who spend a large portion of their income on food purchases. However, historical and implied price volatilities of major crops (wheat, maize and soybeans), indicate that volatility has been on a downward path since July 2015, with levels of volatility having fallen around 50% by the end of 2015.
Historical price volatility of major crops (wheat, maize and soybeans) indicates that volatility was higher for wheat and maize but lower for soybeans year-on-year. Implied volatility, which measures the level of expected future volatility, observed in Chicago Board of Trade options on futures markets, was higher for all three commodities, even though actual price levels did not exhibit large variances over the past six months.
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EABC Code of Conduct for Business in the East African Community
Preamble
We, the private sector of the East African Community, have developed this Code of Conduct for Business in the East African Community together with its Rules & Procedures as an initiative aimed at enhancing ethical business practices in the areas of Human Rights, Labour Standards, Environment, and Anti-corruption.
We, the members, encourage our peers to join the initiative by signing up to the Code together with its Rules & Procedures. It does not replace, but complements individual company’s Codes of Ethics and other existing national and international level codes.
Our commitment to these ethical standards, guides our interaction with our stakeholders, that is, our employees; our shareholders and investors; users of our products and services; our suppliers, contractors and agents; our societies; our competitors and our national states and governments; the East African Community; and the environment.
We reaffirm that the private sector is the engine of growth and socio-economic development for the EAC. This Code provides common values to support regional economic integration and trade for prosperity in the EAC.
The Code
By committing to this Code, we pledge to treat our stakeholders with respect, to run our businesses responsibly, to act in compliance with applicable laws and regulations, and to be actively involved in promoting integrity and corruption prevention.
East African Community
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Respect: We respect the EAC, all its organs, and the common vision and values it represents.
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Responsibility: We commit to promoting the East African Community’s goals by applying the highest ethical standards to our business operations and relations.
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Compliance: We comply with all laws and regulations of the EAC and its individual member states, whether doing business at national level or across the EAC.
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Integrity and anti-corruption: We do not participate in, or induce any unethical practice while doing business in the member states and across the region. We collaborate and support the EAC in promoting ethics and anti-corruption.
Our Workplace
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Respect: We respect the human rights and dignity of all our employees and do not tolerate unfair discrimination, exploitation or favoritism.
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Responsibility: We take responsibility for providing decent, safe and healthy work environments for our employees, and for developing their talent.
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Compliance: We commit to complying with prevailing legislation, good governance, industrial guidelines and international standards.
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Integrity and anti-corruption: We uphold ethical behavior and commit to institute internal control systems and build a culture of corruption-free business practices.
Our Shareholders and Investors
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Respect: We hold our shareholders and investors in high esteem and value their contribution to our business.
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Responsibility: We strive to give our shareholders and investors a fair return on their investments and protect their investments as entrusted to us. We will avoid using insider information in a manner that is detrimental to other stakeholders.
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Compliance: We comply with principles of good corporate governance.
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Integrity and anti-corruption: We uphold integrity and refrain from unethical practices that compromise the investments made by our shareholders and other investors.
Our Consumers
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Respect: We recognise our consumers as stakeholders, value their feedback and refrain from misleading or exploiting them.
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Responsibility: We aim to provide products and services that meet high standards of safety, quality and reliability, and build trust in our brands. We take full responsibility for products that fail to meet the required standards.
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Compliance: We comply with consumer protection laws and standards applicable in the EAC member states, and ensure that our products and services observe health, environmental and safety requirements.
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Integrity and anti-corruption: We strive to uphold the highest standards of ethics and professionalism in the provision of goods and services.
Our Suppliers, Contractors and Agents
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Respect: We value our suppliers, contractors and agents as partners and will engage in fair operating practices that will promote mutual respect.
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Responsibility: We uphold good corporate governance to promote equity and fair competition. We will ensure that the securing of services is done with high ethical standard and results to good quality end products/services
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Compliance: We comply with all legal and contractual obligations and uphold high ethical standards in procurement and other processes. We insist on the same commitment from our suppliers and agents.
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Integrity and anti-corruption: We commit to refrain from corrupt practices that can harm relationships with our business partners. We actively encourage our suppliers, contractors and agents to adopt ethical business practices.
Our Competitors
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Respect: We treat our competitors respectfully recognising their contribution to the industry.
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Responsibility: We commit to engage in fair competition practices within our particular industries and sectors.
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Compliance: We comply with competition laws and regulations.
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Integrity and anti-corruption: We commit to avoid behavior that undermines fair competition rules.
Our Community
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Respect: We recognise and respect cultural and social norms of the communities in which we operate and embrace diversity.
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Responsibility: We strive to serve in the public’s best interest and hold ourselves accountable for the impact of our operations on local communities.
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Compliance: We observe the ethical norms of the communities affected by our operations.
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Integrity and anti-corruption: We engage with communities and other stakeholders in creating a corruption-free society.
Our Governments
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Respect: We respect our elected governments, all organs of the member states and the rule of law.
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Responsibility: We do not participate in, or induce public officers to engage in any unethical practice.
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Compliance: We comply with all laws and regulations within the EAC and in the individual member states.
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Integrity and anti-corruption: We collaborate and support our governments in promoting ethics and anti-corruption.
Environment
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Respect: We respect our natural environment, ecosystems and biodiversity and acknowledge their importance for society and their value to our businesses.
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Responsibility: We make responsible use of natural resources and strive to minimize the adverse ecological impacts of all business activities to achieve environmental sustainability.
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Compliance: We comply with environmental laws and regulations and implement environmentally sustainable practices. We commit to sustainable development and full life cycle responsibility for our products/services.
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Integrity and anti-corruption: We refrain from unethical practices that can degrade our natural environment and promote environmental protection throughout our value chain.
Implementation
We demonstrate our commitment by creating policies, procedures and structures to implement the values and obligations of this Code in our companies, and by reporting annually on our implementation of this Code. It is the company management’s responsibility to ensure that employees understand and comply with the Code.
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AfDB releases new report on the impact of Ebola on women
On the occasion of International Women’s Day, March 8, 2016, the Office of the African Development Bank’s Special Envoy on Gender, Geraldine Fraser-Moleketi, has launched a report on “Women’s Resilience: Integrating Gender in the Response to Ebola.”
The AfDB-commissioned study brings to light a topic that has often been discussed, but never investigated concretely – did Ebola affect women and men differently? The answer is a resounding yes. Bank experts have long suspected that infectious diseases tend to exacerbate the socio-economic vulnerabilities that are present prior to an outbreak, and that knowledge has been confirmed by this AfDB report.
Having visited Liberia, Sierra Leone and Guinea-Conakry in August 2015, at the height of the epidemic, VP Fraser-Moleketi noted, “I met women and men working tirelessly to eradicate this disease. Countless lives were lost in this battle and the repercussions will be felt for years to come in terms of economic growth. For women, there was, and still is, a danger of reverting to the way things were before.”
The report investigates the futility of trying to build resilience to Ebola and future infectious disease shocks in households and communities without also addressing systemic gender inequality. Factors that entrench vulnerability for the entire population must be addressed in the immediate response, medium-term mitigation and long-term intervention. The gender effects of Ebola in the region are influenced by the skills and strategies used prior to the outbreak, and the mechanisms individuals used to cope and adapt differ.
The report also highlights that the lack of gender disaggregated data should not limit interventions, and that all efforts must be made to collect the relevant information to combat the inequalities underscored by disease outbreaks now. The insights contained in this report are not only invaluable for dealing with other epidemics, but may also assist in the prevention of further outbreaks.
One of the recommendations of the report was to establish a Social Investment Fund. The AfDB has since invested $33 million into the Post-Ebola Social Investment Fund, a project supported by the US State Department.
The African Development Bank’s level of ambition in improving quality of life remains high. It is determined to make the best of its resources to provide access to health, social protection and education to all Africans, men and women, young and old, across the continent, to overcome a key constraint on Africa’s development and set the continent on the path to inclusive growth.
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Addressing gender gaps in Africa’s labour market
Sustainable development will depend on better gender equality. Yet, African women continue to face persistent challenges to get decent jobs. This requires a continental effort and proactive action: ILO Report
In sub-Saharan Africa, over 60 per cent of all working women remain in agriculture, often concentrated in time and labour-intensive activities, which are unpaid or poorly remunerated. Reversing the employment gender gap is a pressing priority, says a new ILO report.
In some countries in sub-Saharan Africa, time-related underemployment for women is as high as 40 or 50 per cent of total employment while women continue working fewer hours in paid employment and still perform the vast majority of unpaid household and care work.
“The report shows the enormous challenges women continue to face in finding and keeping decent jobs,” said ILO Director-General Guy Ryder.
To mark International Women’s Day, the ILO launched the report entitled Women at Work: Trends 2016 which examined data for up to 178 countries and concludes that inequality between women and men persists across a wide spectrum of the global labour market.
“Our actions must be immediate, effective and far-reaching. There is no time to waste. The 2030 Agenda is an opportunity to pool our efforts and develop coherent, mutually supporting policies for gender equality.”
In Sub Saharan Africa, many working women still remain self-employed and a high proportion work as contributing family workers (34.9%).
Informal employment in sub Saharan Africa is greater source of non-agricultural employment for women than for men but the gender gap in informal employment still exists and reaches up to 13 percentage points.
Moreover, the report also provides new evidence on the nexus wage, employment and social protection. Globally 40% of women in wage employment do not contribute to social protection but 63.2% of women in wage employment in Sub Saharan Africa do not contribute to social protection.
Persistent gender gaps
On average, women carry out at least two and half times more unpaid household and care work than men. The gender gap in this regard is 73 minutes per day in developing countries compared to only 33 minutes in developed countries.
The highest gender unemployment gaps is found in Northern Africa and the Arab States with the female youth unemployment rate is almost double that of young men, reaching as high as 44.3 and 44.1 per cent, respectively.
In developing economies, women in employment spend 9 hours and 20 minutes in paid and unpaid work, whereas men spend 8 hours and 7 minutes in such work. The unbalanced share of unpaid work limits women’s capacity to increase their hours in paid, formal and wage and salaried work.
Moreover, women spend 4 hours and 30 minutes per day on unpaid care work, compared to 1 hour 20 minutes for men in these same developing countries.
In sub-Saharan Africa, female participation rates in labour force have increased by 3.2 percentage points over the last two decades. This increase could well be due to the absence of or insufficient alternative income from social protection and persistent poverty not allowing the option of dropping out of work.
Moreover, limited opportunities to further their education or training also compel more women to work. In addition, persistent male unemployment often leads to an increase in female labour force participation, in order to compensate for lack of income, but such increases in the female labour supply are likely to be absorbed among own-account and contributing family workers.
Policy Responses
The ILO theme for International Women’s Day 2016 is “Getting to Equal by 2030: The Future is Now”, reflecting the urgency of addressing these gaps if the U.N. 2030 Sustainable Development Agenda is to be achieved.
Progress has been made in recent years toward understanding the complexities of decent jobs and gender equality and how to promote them. The ILO will prioritize focusing on key areas to support opportunities for gender equality:
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An integrated framework of transformative measures with the support to the 2030 Agenda for Sustainable Goals through ILO conventions and recommendations
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Tackling sectoral and occupational segregation by promoting affirmative action
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Closing the gender wage gap by eliminating outright discrimination and embracing the principle of equal opportunity
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Promoting policies that reduce barriers preventing women from starting and developing their businesses to encourage more women to become entrepreneurs.
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Achieving harmonization between work and family life by recognizing, reducing and redistributing unpaid care work through the promotion of decent and adequately paid jobs in the care economy.
“Achieving gender equality at work, in line with the 2030 Agenda for Sustainable Development, is an essential precondition for realizing sustainable development that leaves no one behind and ensures that the future of work is decent work for all women and men,” concluded Shauna Olney, Chief of the ILO’s Gender, Equality and Diversity Branch.
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Financially inclusive ecosystem will enhance COMESA integration agenda
A financially inclusive ecosystem that takes on board all financial service providers will enhance the regional integration agenda espoused by the Common Market for Eastern and Southern Africa (COMESA).
Pursuant to this objective, the COMESA Monetary Institute (CMI) has begun the process of developing a model strategy for enhancing financial inclusion in its member States.
Working with the African Development Bank (AfDB) and Alliance Forum Foundation (Japan), the CMI organized a workshop in Nairobi (24 February to 1 March 2016) for COMESA member States titled “Enhancing Financial Inclusion in COMESA Region – through Enhancement of the Regulatory and Supervisory Framework.”
The workshop was attended by participants from Burundi, Union of the Comoros, Djibouti, DR Congo, Egypt, Eritrea, Ethiopia, Kenya, Madagascar, Malawi, Rwanda, Sudan, Swaziland, Uganda, Zambia, and Zimbabwe.
The workshop followed a directive by the COMESA Committee of Governors of Central Banks held in Lusaka, Zambia in November 2015, to develop a model strategy for enhancing financial inclusion in the COMESA Region.
The workshop produced a regulatory and supervision frame work which balances financial inclusion and financial stability and also recommended the preparation of Model Strategy for Financial inclusion in COMESA Region from 2017-2022.
The framework details performance benchmarks for financial inclusion; a wider basket of products and services for financially excluded and possible delivery channels of the identified services.
The Governor, Central Bank of Kenya Dr. Patrick Njoroge told the delegates that the development of proportionate, risk based, regulations by policy makers was critical to guaranteeing the development of a dynamic, robust and sustainable microfinance framework for a country.
Citing the case for Kenya, the Governor stated: “While commendable achievements have been made, in the past six years the microfinance sector is faced with key challenges, which include among others high cost of credit, inadequate products and services and weak consumer protection framework.”
He therefore emphasized the critical role of Central Banks in providing a diverse range of financial products to the unbanked.
“The role of the Central Bank of Kenya in this regard is centered on the promotion of an enabling legal and regulatory framework that fosters the development of a diverse range of financial service providers while guaranteeing its dual mandate of financial stability and financial integrity,” Dr Njoroge said.
The Director of the CMI Mr. Ibrahim Zeidy said that COMESA’s integration agenda requires enhanced private sector development that ensures sufficient access to finance by Micro, Small and Medium enterprises. In this regard, he emphasized the importance of preparing a Model Regional Financial Inclusion Strategy which is aimed at providing a blueprint for enhancing financial inclusion in the region.
The Chairman of Board, Alliance Forum Foundation and Special Advisor to the Cabinet Office of the Prime Minister of Japan Mr. George Hara underscored the importance of Public Interest Capitalism. He said this was the key to creating a thick layer of middle class.
“Such a system will enable companies to serve the interest of all stakeholders, namely customers, employees, executives and business partners, through products, services, and employment,” he said.
Others who addressed the delegates included Mr. Tadashi Yokoyama and Mr. Julius Karuga of the African Development Bank Group.
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Ethiopian farmers need urgent assistance amid major drought, warns UN agency
The United Nations Food and Agriculture Organization (FAO) on Monday, 7 March announced that timely agricultural assistance for the upcoming rainy season is essential to help the drought-affected people of Ethiopia, as one of the strongest El Niño events on record continues to have devastating effects on the lives and livelihoods of farmers and herders.
“FAO urgently needs $13 million by the end of March to support more than 600,000 of the worst affected people,” said FAO’s country representative, Amadou Allahoury Diallo, in a press release.
“We’re expecting that needs will be particularly high during the next few weeks,” he added, “so it’s critical that we’re able to respond quickly and robustly to reboot agriculture now before the drought further decimates the food security and livelihoods of millions.”
Humanitarian needs have tripled
Humanitarian needs in Ethiopia have reportedly tripled since the beginning of 2015 as the drought has led to successive crop failures and widespread livestock deaths.
As a result, food insecurity and malnutrition rates are alarming in the Horn of Africa country, with FAO reporting that some 10.2 million people are now food insecure. In addition, one-quarter of all districts in Ethiopia are officially classified as facing a food security and nutrition crisis.
Meanwhile, the agency is highlighting that with planting for the country’s first rainy season, known as the belg, which is already delayed, and the meher season – Ethiopia’s main agricultural campaign – fast approaching, farmers need immediate support to help them produce food between now and September for millions facing hunger.
The meher produces up to 85 per cent of the nation’s food supplies.
Recent estimates by Ethiopia’s Bureau of Agriculture indicate that some 7.5 million farmers and herders need immediate agricultural support to produce staple crops like maize, sorghum, teff, wheat, and root crops, and livestock feed to keep their animals healthy and resume production.
Farming families are said to have either exhausted seed reserves through successive failed plantings, or to have consumed them as food. Animal feed stocks are also depleted, and support is needed to enable families to produce fodder. Hundreds of thousands of livestock have reportedly already died and the animals that remain are becoming weaker and thinner due to poor grazing resources, feed shortages and limited water availability, leading to sharp declines in milk and meat production.
‘Not just a food crisis’
“It’s important to understand the current drought is not just a food crisis – it is above all a livelihood crisis,” said Mr. Allahoury Diallo, who highlighted that last year’s losses have severely diminished households’ food security and purchasing power and forced many to sell their last remaining agricultural assets.
FAO is underlining that meeting immediate needs of farmers now is essential to longer-term recovery, as it helps farmers feed their country and keep their productive assets intact. Its call for $13 million by the end of March is part of the agency’s larger $50 million appeal for its Ethiopia El Niño Response Plan but currently less than 10 per cent of the plan is funded.
FAO’s response to El Niño
As part of the emergency response, FAO is already providing planting materials to help seed- and food-insecure households in the worst-affected regions plant in the belg and meher seasons. But it is warning that this support urgently needs to be scaled up.
In an effort to preserve livestock, FAO has been distributing nutrient blocks in pastoral and agropastoral areas meant to strengthen livestock and bolster the resilience of the cooperatives that produce them. FAO is also providing survival animal feed and support to help farmers produce fodder and improve access to water for livestock. Herds across the country have also benefited from vaccination and treatment campaigns to address their increasing vulnerability as a result of drought.
In Ethiopia’s Somali Region, FAO is enhancing the financial stability of drought-affected households through the purchase of weak sheep and goats for immediate, local slaughter, and providing the meat – rich in protein – to nutritionally vulnerable drought-affected families. The intervention will help reduce stress on available feed, enable households to focus their resources on their remaining productive animals, and invest in productive assets.
In addition, FAO is closely working with the government to conduct seasonal assessments and develop preparedness and response plans, along with guidelines for emergency agriculture support.