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Regional economic blocs key to attaining Pan-Africanism
Strong regional economic communities (RECs) are the key to Africa’s long term goal of creating a vibrant, united and prosperous continent.
South Africa’s High Commissioner to Tanzania and the East African Community, His Excellency Thamsanqa D. Mseleku, said his country was committed to the creation of strong and viable RECs across the entire continent, adding that RECs were the surest way to achieve the founding fathers’ dream of Pan-Africanism.
RECs are the first step to the African Union’s ultimate goal of creating an African Economic Community.
Amb. Mseleku said South Africa was keen to ensure that African countries build on the gains made in regional integration, democratisation, economic growth, good governance, security and political stability.
He noted that while Africa had made significant gains in these areas, there were still major challenges to be surmounted citing the situations in Burundi, South Sudan, the Central African Republic and Somalia.
“On the economic front, there are sudden problems emerging in the world which have a negative impact on African economies most of which are mainly resource based,” he said.
The envoy said his country was open to increased cooperation and partnerships with the EAC, which he described as Africa’s fastest growing economic bloc.
Amb. Mseleku was speaking when he presented his credentials to the EAC Secretary General, Amb. Dr Richard Sezibera, at the EAC Headquarters in Arusha, Tanzania. The High Commissioner was accompanied by Mr Manqoba Mdluli, the Third Secretary Political Affairs at the South African High Commission in Dar es Salaam.
In his remarks, Dr Sezibera hailed Amb. Mseleku on his appointment as South Africa’s High Commissioner to the EAC.
“We consider South Africa as a very strong partner of the EAC. South Africa is a strong leader in terms of Pan-Africanism. South Africa’s leadership cuts across regional economic blocs and countries,” said Dr Sezibera.
Dr. Sezibera said the EAC was trying to form a Political Federation as its contribution to Pan-Africanism, the realisation of which he said would reverse the negative legacy of colonialism on the continent.
“We have a Customs Union, a Common Market and are working towards the attainment of a single currency for the region by 2024. We are also working together with the South African Development Community and the Common Market for Eastern and Southern Africa to create a free trade area and to make it work,” said the SG, adding that he looked forward to South Africa providing leadership during the tripartite negotiations.
He said that for regional integration to succeed, big economies must be willing to make sacrifices more because in the end they will be the biggest beneficiaries.
“There will be a temporary loss but big economies like South Africa, Kenya and Egypt will inevitably gain more in the end,” he said.
He praised South Africa’s efforts in trying to mediate a peaceful resolution to the conflict in Burundi and South Sudan.
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Africa rising: The new growth agenda
There is no one ‘big’ answer to how growth can be generated; instead we must break down the question, piece-by-piece, in search of the many smaller answers that together can produce transformational change for growth.
The IGC held its 2015 Africa Growth Forum in Addis Ababa, Ethiopia from Monday 29 June – Wednesday 1 July. The Africa Growth Forum (AGF) is an annual conference bringing together the research and policy communities to discuss the challenges and opportunities to fostering sustainable development in Africa. The AGF also serves as a platform, showcasing research and ideas that have been or are currently being tested and implemented throughout the International Growth Centre’s (IGC’s) network. Highlighting innovative methods and approaches that are being used in various development contexts creates a space for match-making between researchers and policymakers on the basis of shared challenges and opportunities. The forum also facilitates the transfer of knowledge and ideas within the IGC network and beyond.
Emerging from three days of lectures, panels and framework sessions in Addis Ababa, Ethiopia, the overarching message of AGF 2015 was the importance of identifying the mechanisms and policies that must be in place for Africa to rapidly industrialise and urbanise. These twin challenges require innovative research and policy engagement across all four of the IGCs thematic areas: State, Firms, Cities, and Energy.
Careful understanding of the contextual factors that can best deliver growth in Africa will require collaboration between academics and policymakers for the co-generation of both research questions and the design of innovative solutions. Avenues for future collaboration include the following areas:
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Identifying mechanisms to strengthen state effectiveness and governance, including an emphasis on the use of effective recruitment, incentives and monitoring strategies for service delivery.
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Creating jobs within existing sectors and expanding industrial bases to encourage job-creation in higher-value sectors. Investments in high-value production chains can facilitate integration of African firms into global supply chains.
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Designing instruments to facilitate careful urban planning is essential to generate financing for urban growth that fosters the development of productive and liveable cities. Importantly urban planning must account for increased pressure on services that will arise from continuing urban migration flows of low-income workers.
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Encouraging demand-side alternatives for energy generation such as incentives that encourage consumer payment for electricity consumption.
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State bets on accurate and timely data to boost services
With just weeks left to the signing of the new United Nations development goals, Kenya is coming up with new data collection and dissemination systems that could prove critical in the attainment of Vision 2030.
The data revolution which is being spearheaded by the Office of the Deputy President, will enable real time harnessing and open sharing of data to enable government to track development and enhance planning.
On Friday, Deputy President William Ruto opened a Forum on Harnessing the Data Revolution for Sustainable Development in Nairobi.
The country currently relies on the Kenya National Bureau of Statistics whose data is partly available on government-run website opendata.go.ke. However, the information contained on the website is often too old or not updated.
In the new plan, an alliance bringing together producers of data, citizens, businesses, non-governmental organisations, education and financial institutions will spearhead data collection.
“The UN Secretary General, Mr Ban Ki-moon, last year, emphasised on the need for a data revolution as a critical aspect of the SDGs (Sustainable Development Goals). This agenda is borne of the realisation that unlike in 2000 when MDGs (Millennium Development Goals) were ushered in, the world today is witnessing incredible increase in the scale and volume of data production,” said Mr Ruto.
Kenya is the only country in Africa where this revolution is taking place, the conference heard.
“Accurate, timely, disaggregated and accessible data are essential for governments to deliver services efficiently, fairly and transparently,” the deputy president said.
He added that even though Kenya had made progress in Information and Communications Technology, especially with programmes such as the Open Government Platform launched three years ago, a lot still needed to be done.
“Basic data like births and deaths, the size of the labour force, and the number of children in school, all fundamental to governments’ ability to serve our people to the fullest are still not readily available,” he said.
County governments too will be allowed to generate their own data, including their own individual gross domestic product, a move that will dramatically change how resources are shared between national and county governments.
Currently, devolved units receive resources from the National Treasury based on a formula designed by national government that considers their physical sizes, population and poverty index. This formula has constantly created conflicts between the two levels of government.
It is such conflicts that this data revolution, which has the support of governors, hopes to prevent.
“With devolution taking root in our country, it will be important to engender this shift, if we are to successfully drive social, economic and structural transformation,” Kakamega governor Wycliffe Oparanya said.
He added: “For instance, the data revolution will be critical in ensuring that division of revenue is based on evidence, that our agricultural practices are smart and adapt to the ever-changing climatic conditions, that our healthcare meets the needs of our population and that planning is based on accurate data from sources such as civil registration and vital statistics.”
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New report: How Open Data can drive sustainable development
Open Data – data that is freely available online for anyone to use and republish for any purpose – is becoming increasingly important in today’s development agenda driven by the Data Revolution, which has been recognized worldwide as the key engine for achieving the post-2015 UN Sustainable Development Goals.
Data is probably one of the most valuable and least-utilized assets of modern governments. In that context, Open Data is being widely recognized as a resource with high economic and social value and as an effective approach for smarter data management.
The primary purpose of Open Data initiatives worldwide is to help governments, businesses and civil society organizations utilize the already available digital data more effectively to drive sustainable development. Many Open Data initiatives involve taking data that is already publicly available and putting it into more usable formats, making it a powerful resource for private sector development, jobs creation, economic growth, and more effective governance and citizen engagement.
In recent years, several studies – including those led by the World Bank – have shown a growing number of Open Data applications around the world, from water management social enterprises in India to agro-businesses in Ghana. The Open Data Impact Map, developed as part of the OD4D (Open Data for Development) network, has more than 1,000 examples of such use cases from over 75 countries, and the list is growing.
The World Bank has now published a new policy paper, “Open Data for Sustainable Development,” that highlights the ways Open Data can be utilized to achieve development goals through a range of applications such as improved medical care, financial access and management, urban planning, agriculture, and many other areas. The World Bank has identified four broad types of benefits of Open Data, which are illustrated throughout the paper with specific examples, some of which are highlighted below:
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Fostering economic growth and job creation: Open Data helps fuel new companies and helps existing companies operate more efficiently and profitably. New lending organizations in several countries use Open Data to make loans to borrowers with no credit history. In addition, Open Data about available jobs and workers’ skill sets, job-matching platforms are helping employers staff up and individuals find employment. And Open Data can improve the foreign investment climate, creating new growth opportunities.
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Improving efficiency and effectiveness of public services: Social service agencies are using Open Data to help prospective patients find medical clinics or emergency care; to improve access to high-quality education;; and improve agricultural programs and food security.
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Increasing government transparency, accountability, and citizen participation: Open Data plays a critical role in improving governance by exposing and preventing corruption. Several national governments are considering open contracting standards, which would bring new transparency to government contracts – a move that could increase trust in those governments both among citizens and for foreign investors.
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Facilitating better information sharing within government: Municipal governments are using Open Data to coordinate efforts that improve transportation and other aspects of city infrastructure, and also to manage recovery efforts when hurricanes or other natural disasters damage that infrastructure.
These applications of Open Data and others are relevant to the Sustainable Development Goals (SDGs) that will be adopted by the U.N. General Assembly next month. The SDGs cover a wide range of issues, including economic, health, education, and environmental factors. Open Data can play a critical role in helping to achieve the SDGs, and can also support the U.N. Data Revolution initiatives now under way.
As the world is becoming more data-driven, governments are uniquely positioned to provide some of the most valuable types of data to businesses, civil society and the general public. To make their Open Data programs successful, governments will need to do more than simply open the gates and make data public. They need to engage with the current and potential users of their data, provide legal and policy structures for data use, and focus on the quality of important datasets.
But we now have more evidence than ever that these Open Data programs will be worth the effort. With the right focus, approach and implementation, Open Data can have a high economic and social return on investment for countries in all regions and at all stages of development.
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African Caucus 2015: Angola defends financial agreement among African states
Angola defended dialogue and consultation between policy makers and technicians of the financial and monetary sectors of the African States at a meeting of regional finance ministers, which concluded in Luanda on 28 August.
In this way Africa can contribute in a convergent and consistent way, at a time of instability in the world economy, said the Angolan vice president, Manuel Domingos Vicente, on behalf of President Jose Eduardo dos Santos, at the opening day of the forum, also attended by heads of central banks.
Such (consistent) contribution, he said, should be done at the level of the African Development Bank (ADB), World Bank (WB) and International Monetary Fund (IMF).
He said that it is institutions with which it is essential to deepen and strengthen cooperation to make it possible to build a system of international financing, fairer and more compatible with sustainable development.
In the current economic and financial situation, he said, we must make a stronger call on the Bretton Woods institutions that support the industrialization of our continent, to make transformation and economic diversification possible.
Vicente stressed that the industrialization of the continent is crucial and ‘we must have a more comprehensive and integrated diversification of economy, based on value chains, both national and regional, in areas in which we must or can compete.’
To realize that vision, he explained, it will be important to add more values to the continent’s resources, either through infrastructure and complementary or support activities, such as systems of transportation, telecommunications, banking and finance.
The meeting had several issues on the agenda in six panels, among which stand out Overview of the Regional Economy, Transformation and Economic Diversification, and Discussion on the 2015 Memorandum of the African Caucus.
Similarly is present the topic of Financing of regional projects related to infrastructure.
Angola was formally appointed as leader of the African Caucus Group in 2015, in an event that took place on last September 3rd and 4th, in Khartoum, Sudan.
This forum is a platform for coordination of African countries for the meetings of the IMF and the World Bank, this being the first time to be held in Luanda.
Created in 1963, the Caucus’s main objective is to strengthen the voice of the governors of the continent on important issues of socio-economic development of the region within the bodies of the Bretton Woods institutions (World Bank and IMF).
The Bretton Woods Conference, formally known as the Monetary and Financial Conference of the United Nations, was the meeting of delegates from 44 allied nations in a hotel in Bretton Woods, New Hampshire, United States, to regulate the monetary system and financial order after World War II.
Luanda Declaration
Having met in Luanda, the Republic of Angola, at our 2015 Caucus, hosted and chaired by Honorable Armando Manuel, Minister of Finance of the Republic of Angola and Chairman of the African Caucus of the International Monetary Fund (IMF) and the World Bank Group (WBG):
- We, the African Governors of the IMF and the WBG discussed ways and means the Bretton Woods Institutions (BWIs) can support our efforts to: (i) address the challenges of financing for sustainable development; (ii) combat tax evasion and eliminate illicit financial flows; (iii) invest in economic transformation and diversification; (iv) finance regional transformative infrastructure projects; and (v) enhance African voice and representation in the BWIs.
IN THIS CONTEXT
Mindful that the world’s increasingly volatile financial markets outlook means that finding the resources to finance the Sustainable Development Goals (SDGs) will be difficult, and conscious that without the right financing and policies, we cannot achieve the set ambitions:
- We submitted for support by the BWIs transformative solutions and actions – including strengthening public policies, harmonizing regulatory frameworks, developing public/private partnerships (PPPs), improving business climate, and restructuring sovereign debt – to unlock the potential of people and the private sector and incentivize changes in financing, consumption and production patterns in support of sustainable development.
Acknowledging that illicit financial flows coupled with aggressive tax avoidance, repatriation of profits and debt repayments are tragically depriving our countries of hundreds of billions of dollars every year; and convinced that domestic resources that our countries can raise themselves will be our largest single resource for funding our countries’ development:
- We proposed some focus areas where BWIs’ assistance could help our countries to raise new development finance through domestic resource mobilization by increasing, inter alia, tax collection, private finance, international public finance; and, in particular, reducing illicit financial flows by 2030, with a view to eventually eliminate them, including through trade, monetary and financial systems, strengthened global economic governance, and improved international tax cooperation.
Underscoring that natural resource wealth presents vast opportunities for development; conscious that our countries that depend on it for export earnings and fiscal revenues face peculiar challenges and remain highly vulnerable to various external shocks; and concerned that more than two decades since the start of diversification programs, the lack of well-designed diversification strategies and inadequate monitoring mechanisms have not helped facilitate economic and export diversifications for Africa’s transformation:
- We suggested few actions that the BWIs could undertake in support of our countries to achieve economic and export diversification by spurring innovation and technologies in higher-value sectors – including agriculture, infrastructure, energy, manufacturing, services, data improvement, and capacity building – to unleash the spirit of entrepreneurship and drive Africa’s transformation.
Reaffirming that infrastructure development remains a key driver and a critical enabler for sustainable growth in Africa; expressing concern on the inadequacy of current international funding and delivery architecture in responding to Africa’s infrastructure needs; noting that the current favorable economic landscape in the continent provides us with a unique opportunity to collectively address regional transformative infrastructure financing with a sense of urgency:
- We proposed for Bank’s support six regional transformative projects in energy and agriculture sectors; as well as a few innovative solutions to reduce Africa’s growing infrastructure financing gap. We also called for BWIs’ financial contributions into the African Development Bank’s (AfDB) Africa50 initiative to unblock the challenges associated with infrastructure project preparation, bankability, and financial structuring as key prerequisites for attracting private capital investments.
Reemphasizing the critical importance and urgency of increasing Africa’s voice and representation within the BWIs:
- We reiterated our position that the size of the IMF Executive Board be aligned with the institution’s growing mandate and renewed our longstanding commitment to a third chair for Sub-Saharan Africa. We recalled the commitment of the Fund membership to complete the comprehensive review of the quota formula by January 2013, and our position for enhanced Africa’s representation through quota shares that reflect our economic dynamism and underlying vulnerabilities. We agreed to maintain a concerted dialogue with the leadership at the IMF and the Bank to enhance the representation of African nationals and effectively promote their career development within the agreed institutional goals of diversity and mobility at all levels of staff.
FINALLY
Cognizant that IDA is and should continue to be the most important source of funding in achieving ambitious SDGs targets:
- We renewed our support to the WBG’s new financing initiatives to facilitate the transition from concessional to non-concessional funding, as well as the ongoing discussion of options to increase the resources available for development finance through IDA. We stand ready to be consulted on options that would be identified.
ACKNOWLEDGEMENT
We, African Governors, thank His Excellency President José Eduardo dos Santos, the Government and the People of the Republic of Angola, for the hospitality and support they accorded us throughout our stay in the country.
Luanda, August 28, 2015
African Caucus
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Intra-African trade rises as market access between blocs improves
Intra-African trade increased by 50 per cent to $61 billion between 2010 and 2013, according to recent data released by the African Development Bank.
The rise is attributed to improved market access and a strong growth in re-exports among African countries.
The increase marks a strategic shift in internal trade on the continent, which was previously relatively low compared with trade flows from the European Union and China, observers say.
Poor quality roads and highways connecting national borders; non-tariff barriers and insecurity are blamed for the weak growth posted by intra-African trade in the past.
Recorded trade flows within the East African Community have grown by an average of less than 15 per cent per annum since 2005 compared with an average growth rate of 20-25 per cent per year in trade activity between the bloc and the Eurozone, research shows.
Africa’s trade with Europe grew to $430 billion between 2010 and 2013 while the value of trade flows with China increased to $210 billion during the same period, AfDB data shows.
The growth of intra-African trade has the potential to reduce unemployment, household poverty and increase tax revenues.
Economists cite increased access to trade routes within economic blocs on the continent for the sharp growth in intra-African trade, with big economies such as Egypt posting bigger export volumes within the Common Market for Eastern and Southern Africa (Comesa) in recent times.
Though latest data on the country’s exports was not available by press time, Egypt’s manufacturing sector is currently considered a leading supplier of textiles, pharmaceuticals and plastics within the bloc.
Similarly, South Africa is a major exporter of building materials, wines and spirits, electronics and motor vehicle spare parts in the Southern Africa Development Community (SADC) bloc.
Increasing re-exports of technological products such as assembled cars between countries has partly driven the growth of intra-African trade, economists said.
The emergence of decentralised global value chains has led to new investments in local but affordable assembling plants on the continent, which offer cheaper route-to-market costs and tax incentives for targeted sectors.
Re-exports are goods that are imported, undergo further processing and are then exported.
“There has been increased market access to African economies, which has resulted in countries such as Egypt experiencing strong export flows within the continent. However, political challenges faced in some countries need to be addressed to sustain the robust growth in intra-African trade,” said Steve Kayizzi-Mugerwa, AfDB’s acting chief economist and vice president.
New interest in local African investments is expected as established trading firms seek to expand in targeted markets over the long term.
Some economists anticipate an increase in cross-border investments by African businesses while foreign companies are likely to accelerate their continental expansion plans.
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Exit Kenya’s sugar, enter Tanzania rice: Kampala’s new trade war
Even as recent trade wars in the East African Community have mostly featured Kenya and Uganda over sugar exports, Kampala has for the past two months been locked in a dispute with Tanzania over an 18 per cent value added tax on the latter’s rice.
The EastAfrican has learnt that tens of thousands of tonnes of rice grown and produced in Tanzania are either lying at Mutukula and Port Bell or in other border towns on the Tanzanian side.
Uganda says it is invoking its internal law as opposed to the EAC laws. Article 15 (1) and (2) of the EAC Customs Union Protocol prevents discrimination and imposition of internal tax on products of partner states.
The five EAC partner states have not yet harmonised domestic tax laws and as such, Uganda’s VAT Act applies in this case, according to Moses Egwapu, a tax policy officer at the Ministry of Finance.
“Why should rice from Tanzania not pay VAT? The VAT Act states that rice from outside Uganda attracts VAT... VAT is a domestic tax,” Mr Egwapu told The EastAfrican.
Mr Egwapu added that the VAT Act applies to all rice imports so as to protect the local industry and give incentive to Ugandan millers to add value to their rice.
This, however, plays into the same nationalistic and protectionist motives that Kenya was using to block Ugandan sugar millers from exporting their excess sugar to Kenya to which Kampala responded by blocking beef imports from Kenya, until Presidents Yoweri Museveni and Uhuru Kenyatta agreed to end the long running trade war.
But the rice lobby in Uganda, which boasts 120 dealers who buy both locally as well as import from the EAC and elsewhere, is citing the EAC Customs Union Protocol and the EAC Customs Management Act as it heads to the courts to interpret the laws and arbitrate in this dispute.
“We are waiting for them to write to us formally about their stand and we shall then take them head on.
“We are going to fight this legally and morally. If this is not solved in the next few days, we will campaign the Protocol, highlighting the discrimination against rice in favour of sugar,” said Issa Sekitto, spokesman of the Kampala City Traders Association, the business lobby to which the rice importers belong.
But other players in Uganda’s rice sub-sector have a different take: That with the country about to go into elections, the imposition of this tax could be political.
Political angle
“Rice farmers in Uganda have become politically alert. They know when to push for protection from imports. This is election time in Uganda. What do you think will happen if the government allows imports to flood the market? It has political consequences,” said Phillip Idro, a rice farmer and miller, and former Ugandan ambassador to China.
The Rice Council of Tanzania says its farmers have invested heavily in commercial rice farming and milling, resulting in improved production at 1.3 million metric tonnes per year – against an annual demand of less than a million tonnes.
Trade rows between partner states testing the EAC instruments and commitment to the integration process are not new. In 2011, Dar slapped a 25 per cent tariff on Ugandan manufactured cosmetics, citing continued unfairness over the infamous “Uganda list of tax exempt raw materials.”
At the start of the Customs Union Protocol in 2005, the EAC granted Uganda a five-year adjustment window to import 135 finished and intermediate products as raw materials, hence zero rated, while these attracted the common external tariff for Kenya and Tanzania.
This allegedly gave Ugandan manufacturers unfair advantage as products from these “raw materials” that were otherwise finished or intermediate for Tanzania and Kenya made similar products from these countries uncompetitive.
After the end of this adjustment window in 2010, Uganda applied for a further three years on a rolling one-year basis for companies that had not matured to start importing non-duty exempt inputs.
Ugandan cosmetics firm Samona Products is one of the companies that briefly suffered this measure, but was given access to the Tanzanian market after the products were tested by compliance bureaus.
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China, Africa underline non-governmental exchanges to boost ties
Leaders of African countries and China have vowed to enhance exchanges. Non-governmental organizations on both sides will boost people to people relations at different levels.
The leaders expressed the need for further strengthening the multifaceted ties of the two peoples at the 4th China Africa People’s Forum which took place in east China’s Yiwu City on Aug. 26.
The forum was held with the theme “Joining efforts towards building a China Africa Community of shared destinies and embracing a new horizon in people to people friendship.”
Addressing the forum, President of the National Assembly of Togo Mr. Dama Dramani said China and Africa have currently built commendable relations at government and party levels. This relation should be further enhanced through upholding the role of NGOs of both sides and young leaders.
Former President of Namibia Lucas Pohamba on his part indicated that the forum meeting is held at the right time as its outcome will lay a good foundation for the high level meetings of the Forum on China-Africa Cooperation (FOCAC) which will take place in December 2015 in South Africa.
Vice President of the People’s Republic of China Li Yuanchao said on his part that the needs and interests of African people should be the driving force in the people to people relations of Africa and China.
During the forum, participants indicated that building a China-Africa community of shared destinies is the request of our times and the common choice of the Chinese and African people.
China and Africa are also facing rare opportunities for development as China is dedicated to attaining the two centenary goals and the Chinese dream of the great rejuvenation of the Chinese nation while African continent is full of vigor and hope and its countries are working for the goals defined in the Agenda 2063 set forth by the African Union, the participants said.
One of the speakers at the forum, Peace and Security Studies Director with Addis Ababa University Ato Yonas Adaye said China is playing a big role in the political and economic arena of the world. He further stipulated that along with the existing strong collaboration between China and Africa, due attention should be given to poverty reduction, prevention of cross border crime and terrorism, and addressing the existing refugee crisis among other issues.
The forum has also called on non-governmental forces of the two sides which mainly include think-tanks, media and businesses to play a booster role for the comprehensive and sustainable development of China and Africa.
Accordingly from 2016 to 2018 the non-governmental sectors will promote cooperation in industry and productivity, build a partnership for peace and security and strengthen capacity building in public health among other key areas.
For this end, China NGOs Network for International Exchange (CNIE) and the Economic, Social and Cultural Council of the African Union (ECOSOC) will take the leading role in setting up a permanent committee of the CAPF in charge of regular contact between non-governmental sectors in China and in African countries.
The forum, which is organized by Forum on China-Africa Cooperation (FOCAC), CNIE and the African Union (ECOSOC) is being attended by more than 200 participants drawn from senior politicians, civil society representatives and youth leaders from China and 30 African countries including Ethiopia.
The first China-Africa People’s Forum (CAPF) was held in 2011 in Nairobi, the second in 2012 in Suzhou, China and the third in 2013 in Khartoum.
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tralac’s Daily News selection: 28 August 2015
The selection: Friday, 28 August
Raising voices for women cross border traders in West Africa: report (WCBT)
The “Raising Voices for Women Cross Border Traders in West Africa Project” seeks to map women’s organisations in the ECOWAS sub-region and their potential to support the capacity building, advocacy and development of women cross border traders, through serving as platforms for the articulation of their challenges and aspirations. In general, the project aims to make concrete information available to all stakeholders, including the ECOWAS, National Governments and Development Partners, for planning of further interventions to support women cross border trade in West Africa. The women cross border traders of West Africa form a significant group of those involved in informal trade across the sub-region. Women cross border traders are not a homogenous group. [Download]
Economic empowerment of African women through equitable participation in agricultural value chains (AfDB)
The report highlights five major constraints that can limit women’s productivity and full inclusion into the agricultural economy: lack of access to assets, lack of access to financing, limited training, gender-neutral government policy, and time constraints due to heavy domestic responsibilities. The report highlighted three broad areas for action that could begin to address the specific constraints women face in each focus country: [Download]
Report calls for overhaul in mining laws to include women (UNECA)
A new report on Women in Artisanal and Small-Scale Mining (ASM) in Africa has called for a policy overhaul in the mining sector for inclusive and active participation of women. The research project, a partnership between ECA and UN Women, aimed at contributing to the diversification of the mining sector in Africa to include women as a necessary for economic empowerment and social transformation. Preliminary findings of the report, which includes case studies from Zambia, Tanzania, DRC, Ghana and Guinea-Conakry found that the legal and policy framework in the mining and extractive industries made it difficult for active participation and inclusion of women in those sectors. Access to affordable capital financing was the single most constraint for women miners says the report. [Download]
Caucus of the African Governors of the World Bank, IMF: remarks by Thabo Mbeki (Thabo Mbeki Foundation)
We would therefore like to appeal that you yourselves should continue to demonstrate the political will to tackle the matter of the illicit outflows by helping to ensure that each of our countries does indeed adopt the required legislation and build and capacitate the necessary state institutions so that each of our countries has the ability to intervene in a sustained manner to curb and end the illicit outflows. As we visited various African countries in the course of preparing our Report, the matter of radically improving the capacity of our state institutions arose quite insistently. Our Report contains some suggestions in this regard. We believe that as Finance Ministers you have a particular responsibility in this regard.
As we prepared our Report we were also privileged to interact with the leadership of both the World Bank and the IMF at their respective headquarters in Washington D.C. We were very pleased with the keenness they showed to do everything necessary to help combat the illicit financial outflows. We humbly suggest that now that our Panel’s Report has now been issued and in the light of the supportive decisions of the Conference on Financing for Development, you should, as Governors of the World Bank and the IMF reengage these important institutions to influence them to attend to the issue of the illicit outflows in a systematic and sustained manner.
We have already drawn your attention to the important decisions on the matter of the illicit financial outflows which were taken at the Conference on Financing for Development. In this regard we believe that you should also establish a properly structured process to interact with the African representatives at the UN in New York, and also our other representatives at the EU in Brussels who would also have access to the European Parliament, as well as our representatives in Paris who can interact with the OECD.
African tax experts to meet in Cape Town (Cape Business News)
Academics, researchers, tax administrators, students, tax practitioners, consultants and decision-makers on fiscal and tax policy in Africa will gather in Cape Town from 2 to 4 September for the inaugural conference of the African Tax Research Network. The conference, with the theme “Contemporary Tax Challenges for African Countries”, will provide an opportunity for the delegates to discuss different aspects relating to national, regional and international tax matters. Academics and practitioners from around the world have been invited to submit papers which will be discussed at the conference. [ATRN www]
2015 AGOA Forum: selected updates
South Africa: Officials happy after AGOA meeting (IOL)
AGOA renewal raises African hopes of unhindered exports to US (Apparel)
Kenya: Opportunities in the wake of Barack Obama visit (Daily Nation)
Kwame Owino: 'Expect changes to China's economic diplomacy with Africa' (Daily Nation)
For African nations that have recently thought of playing China against the West, it may be time to dust up and reconsider that policy. This is because even if the worst were to happen and a full-blown recession was to affect China’s economy, it would emerge from that in the medium term. What will change is China’s commitment to economic diplomacy with more keenness to make choices for its economic assistance among African countries.
UAE plans to build free trade zone in Uganda (Daily Monitor)
UAE Ambassador to Uganda Abdulla Mohammed Al Takkawi said if they got such land, more investors from the Emirates would set up shop in Uganda, adding that the National Bank of Abu Dhabi wants to invest in some projects here. “The one in charge of free trade zones in Dubai came here; he wants a place by the lake and a main road,” Mr Takkawi said yesterday while meeting Parliament Speaker Rebecca Kadaga. “Business people prefer it that way. When we get it, he will come here and bring business people with him.”
Trade-related updates from SA cabinet meeting: (GCIS)
Cabinet approved South Africa to join the Advisory Centre on World Trade Organisation Law in Geneva.
Ms Xolelwa Mlumbi-Peter appointed as Deputy DG, International Trade and Economic Development, Department of Trade and Industry.
Mr Tshediso John Matona appointed as Secretary for National Planning, Department of Planning, Monitoring and Evaluation.
SA's Minister of Finance, Mr Nhlanhla Nene, assumes Presidency of the Council of Ministers of the Eastern and Southern Africa Anti-Money Laundering Group.
South Africa: DTI presentation on up-scaling private sector investment (AgBiz)
This past week the Director General of the Department of Trade and Industry, Mr Lionel October, presented to the Portfolio Committee on Trade and Industry on investment trends. Investment trends are more than just a good indicator of future economic growth as business confidence and investment are fundamental to such all important growth.
Minister Davies conditionally approves ITAC recommendation for tariff increases of steel (dti)
South Africa: Intended Nationally Determined Contribution to COP21 (AgBiz)
The framework for South Africa's INDC is premised on South Africa's national position in the international climate negotiations, including the differentiated obligations of developed and developing countries, and a balanced consideration of development and climate imperatives. The INDC further reflects South Africa's expectations for the outcome of the Durban Platform negotiations being a legal agreement that balances adaptation, mitigation and means of implementation.
Rwanda: Officials await IGAD's El Nino predictions (New Times)
Apparently, not only Rwanda but other regional countries too are waiting for the IGAD Climate Prediction and Application Centre (ICPAC), a regional organisation dedicated to provide warning against climatic hazards and destructive weather to member countries, to shed light on the looming danger, if any.
The New Development Bank: identifying strategic and operational priorities (Observer Research Foundation)
To aggregate diverse and informed perspectives on both strategic and operational aspects of the bank's functioning, the Observer Research Foundation and the National Institute of Public Finance and Policy (NIPFP) organised an intra-BRICS Experts Workshop on 18-19 June 2015 in New Delhi. The workshop was convened as part of India's knowledge support to the Russian Presidency of BRICS. The following suggestions are based on the most relevant inputs shared during the workshop. Many of the suggestions are also potential areas for further research.
China’s economic slowdown: What it means for Africa (The News Hub)
Global slowdown opportunity for Kenya to put house in order (Business Daily)
Dangote to build Kenya cement plant in $1.48bn Africa deal (Business Daily)
A Chinese firm has signed a deal worth $1.487 billion with Nigeria-based cement giant Dangote Group to build cement plants in several African countries including Kenya.
Conversations on the Global Trade and Investment Architecture: E15 Initiative update
This week in the news
Catch up on tralac’s daily news selections for the past week:
The selection: Thursday, 27 August 2015
The selection: Wednesday, 26 August 2015
The selection: Tuesday, 25 August 2015
The selection: Monday, 24 August 2015
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This post has been sourced on behalf of tralac and disseminated to enhance trade policy knowledge and debate. It is distributed to over 300 recipients across Africa and internationally, serving in the AU, RECS, national government trade departments and research and development agencies. Your feedback is most welcome. Any suggestions that our recipients might have of items for inclusion are most welcome. Richard Humphries (Email: This email address is being protected from spambots. You need JavaScript enabled to view it.; Twitter: @richardhumphri1)
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China’s economic slowdown: What it means for Africa
How the depreciating yuan and plummeting global commodity prices threaten to undermine investment in African people and businesses
On August 24th, or what is now being referred to as China’s “Black Monday”, with the Shanghai Composite Exchange suffering its worst one-day loss in eight years, global investors immediately turned their focus to other major stock markets around the world and inevitably speculated about the extent of the falling Chinese share prices’ impact on Western economies. As BBC Economics correspondent Duncan Weldon writes, many market analysts are “always on the look out for the next 2008”, and in the opening hours of August 24th, it certainly seemed both the New York and London markets were in for a disastrous day. The Dow Jones initially fell by 1089 points, its largest drop in history, while the FTSE 100 and NASDAQ were down by 6% and 8% at their respective lowest points of the day.
However, by late morning it became clear the United States and Europe would survive the day relatively unscathed, with many drawing comparisons to the ‘flash crash’ of May 2010, when some of the world’s largest economies lost trillions of dollars in a span of 36 minutes, only to rapidly recover much of the loss. China – despite being the world’s 2nd largest economy – still maintains relatively restricted financial markets, thus cushioning the direct effect of Shanghai’s crisis on other major exchanges.
Far from being a fluke, though, “Black Monday” was symptomatic of deeper underlying problems in the Chinese economy, namely stagnating economic growth and poorly-timed policy choices. Two weeks prior to the crash, China’s government devalued the yuan against the U.S. dollar by 1.9%, followed by an additional 1.6% the next day, in response to slumping economic figures. Exports in July alone fell 8.3%, a shock compounded by declining commodity prices around the world. In effect, August 24th was merely the most crushing blow in a recent trend of lackluster growth in China’s economy that has potentially severe ramifications for the rest of the developing world.
No region stands to lose more than Africa, where last year’s total trade with China amounted to $220 billion. This is nearly three times higher than trade with the United States; in fact, the success of many U.S. development programs in Africa (i.e. the Peace Corps and especially the President’s Emergency Plan for AIDS Relief) has not coincided with markedly increased interest from American businesses. China, on the other hand, has invested heavily in major infrastructural projects across the continent since the 1990s, and resource-rich African countries – including Algeria, Nigeria, South Africa, and Zambia – have rapidly expanded their export sectors to meet the booming demand for raw materials from Chinese firms.
In many ways, the Sino-African relationship has been mutually beneficial. About a million native Chinese currently reside in Africa thanks to greater business opportunities and substantial advances in average living standards. African consumers benefit from lower-cost Chinese goods, particularly cell phones, as well as vastly improved infrastructure. However, to a large extent, this relationship has sustained African economies’ heavy dependence on raw material exports to major powers, and if the recent drop in global commodity prices continues, many African countries will struggle to adjust. The United Nations Conference on Trade and Development currently classifies 45 of the 54 sovereign states in Africa (including 43 of the 47 sovereign states in Sub-Saharan Africa) as commodity-dependent developing countries, defined as countries where the value of commodity exports exceeds 60%.
To further explain one particularly startling example, Angola is Africa’s second-largest oil producer and one of the most commodity-dependent economies in the world. Fuel exports, nearly all of which are crude petroleum oils, account for a staggering 99% of the country’s total merchandise exports and over 57% of its entire GDP. Furthermore, China – at about 45% – receives nearly four times more of that oil than Angola’s next largest export partner: the United States. The historical pretence for this overwhelmingly narrow focus, admittedly, is understandable. Angola is still recovering from a brutal 27-year civil war between two former liberation movements that killed over half a million citizens and devastated the country’s infrastructure. Nevertheless, pervasive collusion between politicians and the state-owned Sonangol Group, as well as multinational oil corporations operating in the country (including Chevron, Exxon Mobil, and Total S.A.), has hindered economic progress and prevented businesses in other industries from acquiring key government contracts.
Simply put, this kind of extreme commodity dependence is unsustainable, especially in the numerous African countries lacking strong civil societies and legitimised political institutions. Crude petroleum has plummeted to less than half of its value from last year, while iron ore and copper prices continue to fall as a result of oversupply in conjunction with diminished demand from China and other large markets. All in all, global commodity prices are at a 16-year low, and for Africa in particular, China’s recent economic woes only exacerbate the problem. Even South Africa, the 2nd largest economy in Africa and one of the continent’s most stable democracies, is not insulated from the dangers of a Chinese recession. On “Black Monday”, the rand hit an all-time low of 14:1 against the U.S. dollar and, largely because commodity exports still account for about 60% of South Africa’s total merchandise exports, foreign-exchange brokers are shying away from the country’s currency and, by extension, its stock market. This has wide-ranging implications for the entire South African economy, as people see their purchasing power rapidly deteriorate and public utilities like Eskom – the largest producer of electricity in all of Africa, which has been forced to implement load shedding (local power outages) 99 days so far this year – feel the effects of massive budget shortfalls.
To be sure, the immediate effect of the yuan’s declining value will be less Chinese demand for African goods, but this is a problem that can be overcome by seeking alternative trade partners. The more troubling long-term impact is the possibility of less direct investment in African infrastructure, technology, and innovation. If the Chinese economy continues to stall, it will not be the multinational conglomerates and powerful business elites who suffer. It will be working-class Africans searching desperately for jobs and small businesses struggling to obtain capital for their operations. Although China certainly needs to do much more to promote diversification in African economies, its involvement in commodity trading inevitably coincides with better employment prospects for the urban poor and greater investment opportunities for entrepreneurs from Lagos to Johannesburg.
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African tax experts to meet in Cape Town
Academics, researchers, tax administrators, students, tax practitioners, consultants and decision-makers on fiscal and tax policy in Africa will gather in Cape Town from 2 to 4 September for the inaugural conference of the African Tax Research Network (ATRN).
The conference, with the theme “Contemporary Tax Challenges for African Countries”, will provide an opportunity for the delegates to discuss different aspects relating to national, regional and international tax matters. Academics and practitioners from around the world have been invited to submit papers which will be discussed at the conference.
The conference, at the Garden Court on Nelson Mandela Boulevard, will be addressed by former Minister of Finance, Trevor Manuel, and tax commissioners from around the continent, including the South African Revenue Service Commissioner, Tom Moyane. Other prominent speakers include:
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Dr Edward Larbi Siaw, Tax Policy Advisor and Head of Policy Unit, Ministry of Finance and Economic Planning, Ghana;
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Dr Anthony Mothae Maruping, AU Commissioner for Economic Affairs;
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Patrick Mukiibi, Commissioner Tax Investigations of Uganda Revenue Authority;
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Gaperi Henry, Commissaire Général, Office Togolaise des Recettes (OTR) ; and
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Dr Adam Elhiraika, Director of the Macroeconomic Policy Division, United Nations Economic Commission for Africa (ECA).
Some of the topics under discussion will include the major drivers of revenue losses on the continent (such as illicit financial flows and trade mispricing) and how the continent can maximise domestic revenue. The ATRN conference consists of two parts: there will be three policy panel discussions and several research sessions where more than 40 academic and policy papers will be discussed.
There will be a panel discussion on how investing in improved tax systems can make a critical difference to improve the nexus between policy and administration and enhance domestic revenue mobilisation, promote foreign direct investment, transparency and accountability and improve the standard of living in Africa.
Another panel will discuss the outcomes of the third International Conference on Financing for Development, which took place in Addis in July 2015, the implications for Africa and the role of African organisations.
Case studies from, among others, Burundi, Uganda, Nigeria, Kenya, Ghana, Morocco, Côte d’Ivoire, Sierra Leone, Malawi, Zimbabwe, South Africa, Zambia, Togo, Liberia, Zanzibar, Angola, Ethiopia and Tanzania, will also be discussed.
ATRN chairperson, Dr Nara Monkam, said that they had sought out high-quality submissions that further the knowledge and understanding of national, regional and international tax matters. Some of these papers will be discussed and debated at the conference.
ATRN was born out of the African Tax Administrators Forum (ATAF) and is the first African based network of academics and researchers that deals with tax policy, legislation and administration at an academic and policy discussion level.
ATRN’s board consists of academics and researchers from, among others, the University of Nairobi in Kenya, Stellenbosch University, the University of South Africa, the University of Bambey in Senegal, the University of Rouen in France, the National School of Statistics and Applied Economics in Abidjan (Côte d'Ivoire,) the National School of Administration and Magistracy in Benin, the Zimbabwe Revenue Authority and the Rwanda Tax Authority.
ATAF is the coordinating body for tax issues in Africa. It is a platform to promote mutual cooperation among tax administrations throughout Africa, and works towards developing state building and governance in Africa. ATAF is currently represented in about 40 countries throughout the continent.
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Raising Voices for Women Cross Border Traders in West Africa Project
The “Raising Voices for Women Cross Border Traders in West Africa Project” seeks to map women’s organisations in the ECOWAS sub-region and their potential to support the capacity building, advocacy and development of women cross border traders, through serving as platforms for the articulation of their challenges and aspirations.
In general, the project aims to make concrete information available to all stakeholders, including the ECOWAS, National Governments and Development Partners, for planning of further interventions to support women cross border trade in West Africa.
The women cross border traders of West Africa form a significant group of those involved in informal trade across the sub-region. Women cross border traders are not a homogenous group. They include a large group of small scale traders with little working capital, infrastructure and rudimentary numeracy/literacy skills.
The women traders are a paradox because in spite of their contributions to the regional and national GDPs of their respective countries, they have not been recognized for their economic contributions. Liberia has proven to be the only West African country that is favourably disposed to the women cross border traders.
While there are no policy frameworks that specifically focus on women cross border traders as a distinctive group, there are a number of supportive policy frameworks at all levels that can be leveraged to support them at the global (CEDAW/MDG3/Beijing Platform for Action), continental (AU Solemn Declaration on Gender Equality/Decade of the African Women/AU Gender Policy Action Plan/Protocol to the Charter on Human and People’s Rights on the Rights of Women in Africa), Regional (ECOWAS Gender Action Plan) and National levels (Gender Action Plans in Member States).
ECOWAS Commission has already commenced formal plans to engage with the women cross border traders by the development of a roadmap in 2013 at an expert’s meeting which was convened and a follow up meeting that considered the draft ECOWAS Plan on Gender and Trade in January 2015. These significant policy initiatives will attract technical resources and capacity building support from International organisations such as the International Trade Centre which is currently supporting the Uganda Export Promotion Council Program with women cross border traders.
Introduction
The Declaration on Intra-Regional Trade and the Continental Free Trade Zone by the Heads of State and Government of the African Union at their 18th Ordinary Session in Addis Ababa from 29-30 January 2012 states that enhanced African trade and deepening market integration can contribute significantly to economic growth, employment generation, poverty reduction, inflow of foreign direct investment, and better integration of the continent into the global economy.
The Heads of State and Government must have had the women cross border traders at the back of their minds while issuing the declaration. The women traders are the economic backbone of the West African sub region. Indeed, the bulk of these women are classified as informal traders or in the case of Ghana ‘head pan traders’, and they contribute significantly to regional integration and trade. They generate employment, ensure food security, and are responsible for poverty alleviation and livelihood.
In addition to their activities, these women traders are also able to see to their family needs including ensuring that their children are in school, have nutritious meals and access to medical care, through the use of the resources accruing to them.
In spite of the perseverance of the women traders, the Regional Trade Policy Environment has not taken this group into cognizance. Since they are mainly engaged in informal trade, their contribution to intra-regional trade in West Africa is under reported; thereby leading to constant harassment by border security officials (i.e. customs, immigration and joint border officials). The women also fall victim to theft, armed robbery, delated crossings at the border posts, and physical/sexual harassment among other things.
The findings of the Raising Voices for Women Cross Border Traders in West Africa Project (2014) during the Nigeria and Ghana review meetings confirm that not much has changed in respect of the treatment meted out to the women cross border traders in the West African sub region by border security agencies. Although significant strides have been made in highlighting the issues that concern the plight of the women traders and in attracting the attention of the policymakers at both the regional and national levels, the time has come for the women cross border traders to be integrated into the Regional Trade Policy Architecture in West Africa.
According to the World Bank Report titled pdf De-Fragmenting Africa: Deepening Regional Trade in Goods and Services (1.85 MB) , such cross border trade in essential for welfare and poverty reduction since poor people and especially women are intensively engaged in the production and trading of informal goods and services that are actually crossing African borders. Allowing these traders to flourish and gradually integrate into the formal economy will boost trade and the private sector base for future growth and development.
Also Dr. Obi Ezekwesili (former Vice President, World Bank) remarked that: “it is clear that Africa is not reaching its potential for regional trade, despite the fact that its benefits are enormous: they create larger markets, help countries diversify their economies, reduce costs, improve productivity, and help reduce poverty. Yet trade and non-trade barriers remain significant and fall most heavily and disproportionately on poor traders, most of whom are women.
“African leaders must now back aspiration with action and work together to align the policies, institutions, and investments needed to unblock these barriers and to create a dynamic regional market on a scale worthy of Africa’s one billion people and its roughly $2 trillion economy.”
As if to echo the perspectives of the World Bank Report as well as the statement of the former Vice President of the World Bank cited above, participants at the Nigeria and Ghana review meetings strongly recommended the establishment of a platform for organisations that will advocate for women cross border traders in the West African sub region.
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Report calls for overhaul in mining laws to include women
A new report on Women in Artisanal and Small-Scale Mining (ASM) in Africa has called for a policy overhaul in the mining sector for inclusive and active participation of women. The research project, a partnership between ECA and UN Women, aimed at contributing to the diversification of the mining sector in Africa to include women as a necessary for economic empowerment and social transformation.
Preliminary findings of the report, which includes case studies from Zambia, Tanzania, DRC, Ghana and Guinea-Conakry found that the legal and policy framework in the mining and extractive industries made it difficult for active participation and inclusion of women in those sectors. Access to affordable capital financing was the single most constraint for women miners says the report.
Speaking during a national review meeting in Lusaka, ECA Coordinator for Africa Centre for Gender, Thokozile Ruzvidzo said that the participation of women in the economic sector and specifically the extractive industries was central to Africa’s structural transformation. “There is interplay between gender equality and Africa’s structural transformation and ECA has identified women entrepreneurship in the agriculture and extractive industries as priority.”
In the Zambian case study, the report found little participation of women miners in the production and trade of gemstones at the international market “whilst gemstones produced in Zambia, in particular, emeralds and amethysts are widely traded in international markets, women miners are not making a significant contribution to the reported production of the gemstones” reads the report in part.
The report recommends the establishment of a clear policy direction for the ASM sub-sector. “In particular artisanal mineral rights should be positioned for progression into small and large scale mining.” The report further calls for change in the current 2-year term renewable artisanal mineral right which it says is not commercially sustainable because it “entrenches artisanal mining as a subsistence activity that poses a risk to both miners and the environment” says the report.
The report also recommends that government facilitates easier access to surface rights so that miners can increase opportunities to diversify mining with other agricultural activities. According to the report, most women miners were “absentee miners” conducting mining on part time and non residential basis. For most women miners, mining were seasonal, ad-hoc and not a primary source of income.
Ruzvidzo said that the research project was aimed at reviewing existing policy, legal and regulatory frameworks in the mining sector, to propose recommendations that integrate gender equality and equity in mining policies, laws, regulations, standards and codes in order to advance women’s economic participation and economic empowerment. The study also examines a wide range of potential financing mechanisms for small-scale mining operations with a view to up-scale them to commercially viability entities.
Background
The African mining landscape is dominated and profited by huge multinational corporations to the exclusion of majority of Africans particularly women and young people.
The launch of the AMDC in December 2013 in Mozambique was touted as a new page in the history and management the of the continent’s mineral wealth. The AMDC is mandated to implement the African Mining Vision which calls and foresees a mining sector that is safe, gender and ethnically inclusive, environmental friendly and socially responsible.
The two-day meeting held on 24th-25th August 2015 is part of a series of review meetings with stakeholders in above countries to discuss findings of the report. The Acting Permanent Secretary in the Ministry of Mines opened and participated in the meeting.
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AfDB unveils plan to empower African Women in Agriculture
The office of the Special Envoy on Gender (SEOG) and the Department for Agriculture and Agro-industry (OSAN) of the African Development Bank (AfDB) launched a new report, “Economic Empowerment of African Women through Equitable Participation in Agricultural Value Chains” on Thursday, August 27 at its headquarters in Abidjan, Côte d’Ivoire.
The event gathered high-level participants, including stakeholders from both the private and public sectors from the countries and sectors examined by the report – cocoa, coffee, cotton and cassava sectors in Côte d’Ivoire, Ethiopia, Burkina Faso and Nigeria, respectively.
“This report prepares the ground to empower women, to take a leading role in the business of farming and agricultural value chains, regionally and globally,” said Donald Kaberuka, President of the African Development Bank.
Agriculture in Africa is poised to remain one of the most important economic sectors, accounting for around 25% of the continent’s GDP. Over 60% of its citizens rely on agriculture for some form of income. To transform the sector, the economic empowerment of women through boosting their productivity and raising their participation in commercial and higher value-add activities in agriculture is central.
Women make up almost 50% of the agricultural labour force in Sub-Saharan Africa. A total of 62% of economically active women in Africa work in agriculture, making it the largest employer of women. In some countries, such as Rwanda, Malawi and Burkina Faso, over 90% of economically active women are involved in agriculture.
“African women feed the continent and they can feed the world, too. But we must close the wide gap in wages and agricultural yields between men and women if Africa is to achieve full economic transformation,” said Geraldine Fraser-Moleketi, the AfDB’s Special Envoy on Gender.
The report highlights five major constraints that can limit women’s productivity and full inclusion into the agricultural economy: lack of access to assets, lack of access to financing, limited training, gender-neutral government policy, and time constraints due to heavy domestic responsibilities.
The report highlighted three broad areas for action that could begin to address the specific constraints women face in each focus country:
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Grow the number of large-scale agribusiness entrepreneurs by providing access to financing and training, and improving regional and global market links.
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Make sure women are remunerated by setting them up as co-owners, improving productivity, and providing training in core business skills.
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Increase women’s access to niche markets by producing and marketing women-only products.
The role of women is largely limited to the unskilled parts of production: few own the land on which they work, they are rarely remunerated for their labour and often do not control the income generated from the sale of agricultural produce.
For example, in Côte d’Ivoire, the report estimates women account for 68% of the labour in cocoa production, but receive only 21% of the income. Similarly, in Ethiopia, women account for 75% of the labour in coffee production and receive only 34% of the income.
This report will help to identify areas that the African Development Bank (AfDB) and its partners could target to empower women economically through agriculture as the Bank implements its Gender Strategy (2014-2018).
Download
» Economic Empowerment of African Women through Equitable Participation in Agricultural Value Chains (10.71 MB)
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AGOA renewal raises African hopes of unhindered exports to U.S.
The suspense over the much-awaited decision on another 10-year extension of the African Growth and Opportunity Act (AGOA) – often called the United States’ General System of Preferences allowing duty-free imports – for African exporting nations is finally over with President Barack Obama recently signing into law the AGOA’s extension for an additional decade.
The AGOA bill was passed with overwhelming bipartisan support during a vote on June 11, 2015. But behind the scenes a cross-section of stakeholders – including African governments, the African Union, the African Diplomatic Corps and members of the U.S. and African private sectors – impressed upon U.S. lawmakers the significance of AGOA and its critical role in strengthening commercial and economic relations between the United States and the nations of Africa. President Obama, before his visit to Kenya and Ethiopia, said, “AGOA will be central to our efforts to boost the trade and investment that supports hundreds of thousands of jobs both in Africa and the United States, creating opportunities for all of us.”
Importers of African textiles and apparel at the TexWorld USA show in late July in New York City were pleased with AGOA’s renewal, which they said created a “win-win situation” for both the U.S. importers and sub-Saharan African shippers.
Mary Marino, the North American director of Cotton Made in Africa (CMiA), was enthusiastic about African exports of textiles and apparel. She expected cotton exports from Africa to grow following the AGOA’s renewal.
“We at the CMiA promote sustainable cotton which is different from organic cotton … we minimize the use of chemicals since Africa does not process cotton, it is sent abroad and then imported back into the country and re-exported to the markets,” Marino said.
CMiA, headquartered in Hamburg, Germany, and part of the Aid by Trade Foundation, promotes cotton produced in a number of countries, including Cameroon, Ethiopia, Ghana, Ivory Coast, Malawi, Mozambique, Tanzania, Uganda, Zambia and Zimbabwe.
The African continent represents 5 percent of global cotton production and more than 9 percent of the world’s cotton exports. Cotton is one of Africa’s most important cash crops, with more than 2.5 million livelihoods dependent on cotton production alone, thus underlining AGOA’s significance for textile and apparel production and, in effect, cotton production.
“Much of the cotton is produced in Africa by smallholders (farmers with less than one hectare of land). These farmers tend to achieve low yields and have a limited access to inputs such as water and pesticides. Quality has traditionally been seen as high throughout the continent, largely thanks to hand picking,” Marino explained.
A key operator called the East Africa Trade and Investment Hub (EATIH), a trade promotion agency based in Nairobi, Kenya, and funded by the U.S. government, has applauded AGOA’s extension. J.C. Mazingue, trade advisor for Africa and a contractor for USAID, said that AGOA would give African exporters duty-free access to 8,000 products, including almost all textile and apparel products.
AGOA, renewed until 2025, has a third-country provision that will give African exporters an added advantage: any fabric can be cut and sown free of U.S. duty. This will also motivate African companies to invest in capacity. Most African factories are doing well. Africa needs greater capacity, which means there is demand for African textile and apparel products in the U.S. The largest African exporter of apparel is Kenya, followed by Lesotho, Mauritius and Ethiopia. The government of Ethiopia has identified textile and apparel as a priority industry. Overseas companies, mainly from India, China and Turkey, have invested considerable sums of money in Ethiopia because of the much lower labor and energy costs. Ethiopia’s primary energy source is hydraulic derived.
According to Mazingue, “The East Africa region is becoming a de facto sourcing hub of the continent. Ethiopia, Kenya, Lesotho, Madagascar, Mauritius are well positioned.”
Ethiopia specializes in work wear, uniforms, basic knits, and more, Mazingue explained. Kenya is the leader in chinos, slacks, denim jeans; Lesotho is a big producer of denims; Madagascar has woven and knit shirts manufacturers; and Mauritius is increasingly becoming a destination for fashion and value-added products, he said.
Infrastructure is a pressing concern for companies deciding whether to source on the continent, and while each country comes with its own issues, Mazingue said, “Generally, energy costs need to go down, and transportation and logistics need to improve.
But Mazingue also spoke about the “strategic advantage” accruing to textile and apparel manufacturers in Africa because of the availability of the cotton crop. The so-called “African cotton belt” comprises countries such as Zimbabwe, Malawi, Ethiopia, Kenya, Egypt, and others.
“The medium range of cotton from Africa can compare to any good cotton from anywhere. Malawi cotton, for example, is good and comparable to other cotton-producing countries,” Mazingue added.
Cotton produced in Africa is a choice that the farmer has to make. There is currently, however, a significant stockpile of cotton in China. “China’s huge stockpile can create market convulsions and affect pricing,” he maintained. “Indeed, the textile industry in Africa has a good potential for growth because all African countries are keen to create jobs and this can be done through the textile industry,” he said.
To achieve the goal of creating jobs, African countries give incentives to potential investors in the form of energy consumption as is happening in Kenya while Ethiopia subsidizes certain areas to generate employment. But, trying to put “things in perspective,” he said that subsidies are given strictly on a case-by-case basis. “Textile and apparel account for 90 percent of exports from the sub-Sahara African region to the U.S. market,” Mazingue said. Indeed, the EATIH, which has facilitated substantial textiles and apparel exports from African countries, supports nine East African countries – Burundi, Ethiopia, Kenya, Madagascar, Mauritius, Rwanda, Seychelles, Tanzania and Uganda – increase their exports to the U.S. under the AGOA.
Buyers at TexWorld pointed out that AGOA-supported export company Mombasa Apparel had launched its fourth textile factory in November 2014 on the coast of Kenya. It produces apparel destined for the U.S. through AGOA. Mombasa Apparel is one of the country’s largest employers, with some 10,000 workers in its four factories in the Mombasa region. According to one textile Kenyan exporter, who insisted on remaining anonymous, the company plans to have a fifth factory online by the close of this year, with the capital investment for the fourth and fifth factories amounting to $25 million.
However, not all African countries have been able to make any substantial headway in terms of increasing their textile and apparel exports following the AGOA renewal. Kenya, Lesotho and Mauritius provide the bulk of apparel exports under the program. In 2014, Kenya exported $423 million worth of apparel to the United States under AGOA; Lesotho, $289 million; Mauritius, $227 million; and Swaziland, $77 million. Experts have urged Ghana, which has not substantially increased its exports of textiles and apparel, to examine why these countries have been so successful in utilizing the preference program.
According to a report by management consulting firm McKinsey, Ethiopia and Kenya, particularly, have the potential to become bigger players in garment manufacturing. Some European companies, including H&M, Primark and Tesco, have been sourcing their garment needs from Ethiopia, but other countries have also been supplying substantial quantities of apparel. Ethiopia and Kenya, and to a lesser extent Uganda and Tanzania, are proving to be of interest to apparel buyers. The Ethiopian and Kenyan governments are taking steps to develop their domestic textile and garment industries.
Both Ethiopia and Kenya have strengths and weaknesses. Ethiopia has cost advantages whereas Kenya boasts higher production efficiency. But both countries face challenges such as poor infrastructure, cumbersome customs processes, a dearth of technical and managerial talent, and low levels of social and environmental compliance.
Apparel production, unlike textile production, typically requires low-skilled labor and minimal capital expenditures, allowing the producing countries to become globally competitive.
Africa’s textile and apparel exports to the U.S. could quadruple to $4 billion over the next decade through the AGOA extension, creating 500,000 new jobs, as Gail Strickler, assistant United States trade representative for textiles and apparel, said prior to the act’s renewal.
Last year, U.S. clothing imports from sub-Saharan countries reached $986 million, up nearly six percent over 2013. Analysts highlight the advantages that Africa offers in terms of lower labor costs and abundant raw materials, including cotton; however, congested ports, a poor road network, lack of skills and old technology are obstacles that need to be addressed.
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tralac’s Daily News selection: 27 August 2015
The selection: Thursday, 27 August
Starting today, in Luanda: African Caucus of finance ministers, central bank governors
The African Caucus Meeting is meant to seek a common ground among the continental financial institutions on relevant matters in their relation with Bretton Woods institutions. The subjects that stand out on the agenda in the six panels are the General Vision of the Regional Economy, Economic Transformation and Diversification, Discussion on the 2015 African Caucus Memorandum and the Financing of Regional Projects connected to infrastructure.
Services trade and African integration: presentation by William Davis (UNECA)
Extract from policy recommendations: Liberalisation of trade in services can help African businesses to benefit from each other’s expertise and increase their competitiveness. But liberalization not always good. Which policies are successful seem to vary by sector. Forthcoming ECA-AUC research on infrastructure services examines hundreds of different policies. [Access other, new postings from the CFTA training workshop on trade in services negotiations]
Why regional payment systems are assuming greater importance (NewsDay)
Africa’s regional payment systems, such as Siress, are expected to play a growing role in the continent’s economic growth story, particularly as intra-African trade picks up. These payment systems are set to be both beneficiaries and drivers of Africa’s economic growth. Underlying growth in trade volumes will create demand for more advanced cross-border facilities and services. “Without a functioning payment system, the vision of increased intra-regional trade will not materialise. It’s a fundamental prerequisite,” Hugo Smit, head of sub-Saharan Africa for Swift says.
Regional integration arrangements in Africa: is large membership the way forward? (Brookings)
Is the attempt at rationalizing the multiple regional integration arrangements (RIAs) across the continent a milestone towards greater cooperation across the continent? Drawing on observations and analysis of the recent experience, I argue that, in spite of the unfavourable geography that makes it difficult to deal with the high costs of heterogeneity, integration initiatives in small member groups will produce the highest benefits. [The author: Jaime de Melo]
2015 AGOA FORUM: selected updates, below
Remarks by Ambassador Michael Froman
In the coming days, let’s stretch our thinking and our ambitions to match this historic extension. We need to make sure AGOA’s potential is fully explored and its benefits fully utilized. That will require work on both sides of the AGOA equation. Our African partners will need to design strategies to take full advantage of AGOA’s tariff preferences, and the United States will need to work to make sure we are providing the trade capacity building and other assistance necessary to support those strategies. But we also need to start thinking about our long-term, trade and investment relationship today, just as the theme of this summit encourages. We do not come to the table with a predetermined outcome in mind, but rather with the perspective that we need to start a dialogue about the emerging opportunities and challenges that will shape the global economy during the next decade, and how we might best navigate this fast-changing landscape together.
SA car export boom sharpens AGOA focus (Business Day)
On Wednesday, Mr Davies was at pains to stress that SA had made "tremendous progress in addressing issues that were raised by the US and, therefore, our country continues to adhere to the Agoa eligibility requirements". "On June 24 2015, the Cabinet took a decision to lift a trade restriction on cattle and products of bovine origin from countries that previously reported bovine spongiform encephalopathy, including the US. Minister Zokwana has written to his US counterpart, secretary Tom Vilsack, on August 6, to announce that SA has lifted trade restrictions on cattle and products of bovine origin from the US," said Mr Davies.
Willemien Viljoen: 'Any progress on the permanent extension of South Africa’s AGOA preferences?' (tralac)
African countries urged to intensify education on AGOA to reap benefits (Ghana Business News)
Trade pacts to curb poaching in Africa, US official says (VOA)
USDA selects ASA’s WISHH to develop West African poultry and feed market (KMAland)
Sub-Saharan Africa, in 2015 Global Agenda for Economic Freedom (Heritage)
Barriers on agricultural produce killing African economies, says Foreign CS (Daily Nation)
A better agreement on agricultural exports will be Kenya’s priority when the world converges in Nairobi for the WTO summit this December. In a meeting with Swedish investors on Tuesday, Kenya’s Foreign Affairs Cabinet Secretary Amina Mohamed argued that the world should adopt better agreements on agricultural produce to aid African economies that depend on it. “African countries’ investments in agriculture have been sinking in a huge black hole, because these legitimate investments cannot compete with distorting subsidies derived from the current Agreement on Agriculture regime,” she said in Stockholm where she is on official visit, according to a statement.
Africa urges Indian businesses to invest in the continent, not just sell (LiveMint)
In a rare move, the envoys of several African nations have criticized Indian entrepreneurs for looking at the continent merely as a vast export market and source of raw materials, urging a rethink of business strategy with a focus on long-term investments in Africa. At a business meeting organized in New Delhi by the India-Africa Chambers of Commerce and Industry in New Delhi on Wednesday, the envoys called on Indian businessmen to be present in Africa and utilize opportunities that they would otherwise lose to their Chinese and European counterparts.
Do EPAs with the European Union benefit developing countries? (Antillean)
Therefore, let it be fully understood; the EPA is not just an agreement with the European Union - it is an agreement with the world. [The author, Ronald Sanders, is Antigua and Barbuda Ambassador to the US]
East Africa - China trade routes fastest growing (IHS)
Trade routes from China to Africa are expected to see a marked increase over the next five years, with the highest growth expected to be seen from the East African to China route, incorporating Malawi, Mozambique, Zambia, and Zimbabwe. “Trade between East Africa and China is expected to increase by 91 percent by 2020,” Atkinson said. “It’s all around manufactured goods. East Africa is becoming a new hub for the Chinese.”
What impact could the 21st Century Maritime Silk Road have on South Africa? (SAIIA)
4th China-Africa People's Forum: update (AU)
FOCAC VI: background and 2015 focus priorities (SAIIA)
Standardization in improving market (The Ethiopian Herald)
According to Demitu Hambisa [Ethiopia's Minister of Science and Technology], one of the challenges African countries are facing is market access in the globalized world. The quality of products and services that they provide should conform to the requirements of the consumers. This implies that companies and service organizations should have sufficient capacity, skilled manpower and appropriate systems to produce goods and services to the required standards. However, most African countries do not have such capacity to make immediate advantage of new trade opportunities; that is to say, due to lack of value addition and diversification in their commodities, they have less probability to be sold in feasible price in the world market.
TRA, freight forwarders to form joint committee (IPPMedia)
In a move to improve and strengthen freight forwarders services in the country, Tanzania Revenue Authority in collaboration with Tanzania Freight Forwarders Association are working to establish a special committee to work on challenges facing the industry.
Uhuru bid to revive Lake Victoria transport seen boosting trade (Business Daily)
Kisumu has received a major boost in its bid to become a regional transport hub after President Uhuru Kenyatta pledged to revive its port in fresh efforts to expand trade with East African neighbours. The port handles mainly Uganda-bound cargo. The plan to revive the facility comes in the wake of a sugar import deal with Uganda which has caused a political storm in Kenya. As part of the Kisumu Port revival plan, the government will prioritise reopening the collapsed Kisumu Cotton Mills and Miwani Sugar Factory.
Swazi government yet to approach Mozambique on shipping port's cross country canal (Club of Mozambique)
There are multiple problems with this scenario. First, no point on the coast is a mere 26 kilometres from Mlawula. As the crow flies, the nearest point on the Mozambican coast is over 70 kilometres from the site of the proposed port. Furthermore, as anyone who has driven from Maputo to Swaziland can testify, the land rises steeply. Canals are fine for transporting goods over flat terrain – but if there are hills in the way, locks must be built, dramatically increasing the costs. Building a canal with a system of locks capable of holding ocean-going vessels would be a massive engineering undertaking. Such an operation is also entirely unnecessary. Swaziland’s main trading partner is South Africa.
Zambia: ZCTU advises govt to be firm over taxes, refuse blackmail (The Post)
In his reflections after attending a Botswana conference on illicit financial flows in Africa, ZCTU deputy general secretary for finance and administration Misheck Nyambose said politics should not come into play when people call for a fair share of the country’s mineral wealth. “Look at the tax regime in the mines today; we were very happy with the initial position of increasing the taxes for the mines to get the best out of it on behalf of Zambians. Unfortunately, politics came into play and the good measures that the government had put up were attacked and there was a lot of blackmail from the multinationals. Our encouragement to the government is that they must remain firm when they come up with measures that protect the interests of Zambians."
Zimbabwe: Unplanned food imports drain fiscus, says VP (The Herald)
Unplanned food import expenditure is a major drain on the fiscus especially when the economy is experiencing challenges, Vice President Emmerson Mnangagwa has said. Officiating at the 3rd annual agro-business conference hosted by the National Economic Consultative Forum at the Harare Agricultural Show yesterday, Cde Mnangagwa said there was need to reduce imports especially on products that could be produced locally. “Maize and small grains production during the season decreased by 9% and 71% respectively. As a result government is working closely with development partners to import grain. These unplanned expenditures on food imports are a major drain on the fiscus and they further worsen our balance of payment position already negatively affected by imports of fuel and manufactured products that are not produced within our borders.”
Kenya: Treasury targets public debt cut to 45% GDP (Business Daily)
The Treasury intends to cut the public debt level to about 45% of the gross domestic product in the next few years, down from the current level of 51.5%. Domestic debt stands at Sh1.4 trillion while foreign one is at Sh1.3 trillion, making a total of Sh2.7 trillion. At a go, the Treasury increased the public debt by Sh283 billion ($2.75 billion) when it raised money last year through a sovereign bond. The debt has risen in the past one year due to the spending on infrastructure, especially the standard gauge railway in which the government is providing more than Sh100 billion besides the Sh330 billion loaned by the Chinese government.
ILO, partners empower people risking HIV infection along transport corridors (IPPMedia)
Salomao: Global financial crisis has delayed regional integration (Club of Mozambique)
'Not SADC’s place to reject Mswati' (IOL)
SA logistics firm negotiating to buy 30pc in Kuehn+Nagel, Kenya (Business Daily)
The 7th edition of trade fair of Chinese products in West Africa kicks off in Benin (Xinhua)
Zimbabwe: No need to import cooking oil – CZI (NewsDay)
ECOWAS healthcare forum (The Nation)
Ethiopia first country to launch ClimDev-Africa Special Fund project (AfDB)
47th ASEAN Economic Ministers’ Meeting: statement
ASEAN to ‘upgrade’ trade deals with Japan, China and South Korea by year’s end (Japan Times)
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Remarks by Ambassador Michael Froman at the Opening Ceremony of the 2015 AGOA Forum
Remarks by U.S. Trade Representative Michael Froman at the Opening Ceremony of the 2015 U.S.-Sub-Saharan Africa Trade and Economic Cooperation Forum (AGOA Forum) in Libreville, Gabon, 26 August 2015
AGOA at Fifteen: Charting a Course for a Sustainable U.S.-Africa Trade and Investment Partnership
Good morning.
Your Excellency, President Bongo Ondimba, Honorable Minister Tchango, esteemed members of the Gabonese Government, Ministers and Heads of Delegations from the 39 AGOA partner countries, my U.S. Government colleagues, and private sector and civil society leaders:
If I may borrow a phrase I learned here in Africa: All protocol observed.
It’s a pleasure to be among so many friends of AGOA.
And of course, some of AGOA’s best friends are the Members of Congress and Congressional staff who have travelled to be here with us at the Forum. For a number of these members, this is their second trip to Africa in as many months, having accompanied President Obama on his historic fourth visit to Africa as President just a month ago. As the President said during that trip, ‘Africa is on the move.’ There’s no question our friends in Congress intend to keep up. Thanks to their leadership, and bipartisan support of large majorities in both houses of the U.S. Congress, as well as the tireless efforts of the African diplomatic corps, and stakeholders in the private sector and civil society, we secured a 10-year renewal of a new and improved AGOA, the longest extension in the program’s history.
In the coming days, let’s stretch our thinking and our ambitions to match this historic extension. We need to make sure AGOA’s potential is fully explored and its benefits fully utilized. That will require work on both sides of the AGOA equation. Our African partners will need to design strategies to take full advantage of AGOA’s tariff preferences, and the United States will need to work to make sure we are providing the trade capacity building and other assistance necessary to support those strategies. But we also need to start thinking about our long-term, trade and investment relationship today, just as the theme of this summit encourages. We do not come to the table with a predetermined outcome in mind, but rather with the perspective that we need to start a dialogue about the emerging opportunities and challenges that will shape the global economy during the next decade, and how we might best navigate this fast-changing landscape together.
But before we delve into the work at hand, let’s pause for a minute to consider how Africa has exceeded expectations. Ten years ago, many thought sub-Saharan Africa would become less important to the global economy. Today, sub-Saharan Africa is among the fastest-growing regions in the world. Many thought the IT revolution would skip Africa. In 2003, Safricom, Kenyan’s leading mobile provider, was planning for 500,000 customers by 2013. They ended up with 21 million. Some put forward grim predictions for health and demographic trends that failed to account for medical innovations and the ingenuity of public-private initiatives. So as we think about the future, let’s remember that Africa has a habit of exceeding expectations.
Looking forward, Africa’s opportunities challenge the imagination. Over the next five years, sub-Saharan Africa’s GDP is forecasted to grow 30 percent faster than the rest of the world. By the World Bank’s estimate, sub-Saharan Africa is home to 413 million children under the age of 15 – nearly as many as the 431 million children in the developed world and China combined. A generation from now, the region will be home to almost a quarter of the world’s workforce. According to the UN, sub-Saharan Africa’s urban population is expected to grow from 360 million to 1.18 billion by 2050, surpassing the urban population of the entire developed world. These demographic trends could be accompanied by greater productivity, demand, and investment, underscoring how important Africa will be to the entire world economy. But they also present new challenges for meeting rising needs.
During the next decade, the march of technology will continue to expand the bounds of what’s possible, including how we trade and what we trade. By 2025, Africa’s internet penetration is expected to climb from 26 percent to over 50 percent, and there will be 360 million smartphones on the continent – roughly twice as many as there are in the United States today. Greater connectivity could mean greater access to essential services, from education, to medicine, to credit and savings accounts. While much of the developed world is locked into investments in older infrastructure, these and other technological trends, especially in energy, provide an opportunity for African countries to leap ahead and adopt more efficient and sustainable solutions. To do so, however, will require strategic investments, strong public-private cooperation, and an abundance of political will.
Africa is already actively deepening and expanding its trade and investment relationships, taking steps to establish the Tri Partite and African Continental Free Trade Area (CFTA) and shifting to more permanent and reciprocal trade arrangements with some of its developed country trading partners. Looking forward, it’s possible to imagine Africa as one large market, from Cape Town to Cairo and Libreville to Port Louis.
As Africa continues rising during the next decade, the rest of the world will not stand still. The United States is already moving forward with next-generation trade agreements that will raise standards across both the Asia Pacific and the Atlantic and could have positive spillovers here in Africa. For example, the Trans-Pacific Partnership will help combat illegal wildlife trafficking, including the illegal trade of ivory from Africa. That will complement some very successful efforts here in Gabon, where effective enforcement has actually reversed rampant elephant poaching and population decline in the Wonga-Wongue Reserve, which I had the pleasure of visiting yesterday. In addition to the environment, we are working to set higher standards across the board – on transparency, good governance, and anti-corruption; on good regulatory practices; and on basic worker rights – all of which are critical, long-term drivers of sustainable, inclusive development. And as more economies join TPP over time, we hope to contribute to rising global standards as well.
Where does Africa fit into this picture? The United States is not new to Africa. We’ve been involved here for decades, not as a colonial power, but as a partner – one focused not just on extracting resources from the continent, but investing in human resources in the continent. Every region, every country is different, with its own set of challenges and its own legacy, but we must not underestimate what this vibrant continent is truly capable of accomplishing.
History shows that it’s a mistake to bet against Africa, and the progress we’ve made together through AGOA encourages us to aim even higher. Doing so will surely require a more comprehensive approach, one which recognizes that tariff preferences alone are not sufficient and addresses the supply-side constraints facing Africa today. To be productive, Africa needs affordable, reliable electricity. To successfully integrate into global supply chains, Africa needs the capacity to meet international standards. To be competitive, Africa needs to match the efficiencies of Asian and Latin American ports with effective trade facilitation policies. And that’s why our approach is to situate AGOA in the context of a broader development strategy that includes Trade Africa, Power Africa, Feed the Future, the Global Health Initiative, MCC compacts, USAID assistance, World Bank and African Development Bank investments and other programs that can support Africa’s own priorities and help build the continent’s capacity to trade competitively in the 21st century global economy.
Our development strategy recognizes the centrality of economic growth to poverty alleviation. It is based on the conclusion that to achieve sustainable growth, we need trade, not just aid; investment, not just assistance. But it is also based on the conviction that growth by itself is not sufficient. The quality of that growth matters as well if we are going to see the powerful linkage between expanding trade and alleviating poverty continue. That requires that the benefits of growth be broadly shared. By 2022, it is estimated that the world’s middle class will surpass the number of people living in poverty. The strength of our economic partnership will play a critical part in determining whether that trend continues and whether, working together, we can end extreme poverty and, indeed, confine poverty to the dustbin of history.
Let me be the first to admit that we don’t have all the answers for the path that we should chart to achieve these goals, but I hope that over the coming days we can begin asking the right questions and identifying the contours of a deeper and more sustainable, post-AGOA, U.S.-Africa trade and investment partnership.
Thank you.
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Finance ministers, central bank governors attend African Caucus in Luanda
From 27-28 August in Luanda, the Republic of Angola will host the Meeting of the Ministers of Finance and Governors of the Central African Banks, the African Caucus, with the aim of strengthening the voice of the continent’s representatives on important issues relating to the socio-economic development of the Bretton Woods Institutions (BWIs).
The African Caucus Meeting is meant to seek a common ground among the continental financial institutions on relevant matters in their relation with Bretton Woods institutions.
The meeting is an opportunity for African financial institutions to put forward, in a concerted and organised way, the most relevant problems affecting the economies of the continent, particularly concerning the construction of infrastructure and industrialisation of the productive processes.
The meeting being held at the Talatona Convention Centre is an important opportunity for the African leaders, represented by their Ministers of Finance and Planning and Governors of the Central Banks, to jointly present in a coordinated and organised way the major and current concerns affecting the economies of the African continent, namely the building of infrastructure and industrialisation of production processes.
The subjects that stand out on the agenda in the six panels are the General Vision of the Regional Economy, Economic Transformation and Diversification, Discussion on the 2015 African Caucus Memorandum and the Financing of Regional Projects connected to infrastructure.
Personalities like the Ex-President of South Africa, Thabo Mbeki, and other individuals connected to the New Partnership for Africa’s Development (NEPAD), the World Bank (WB) and the African Development Bank (AFDB) have been invited to speak on the topics above.
Hosting the African Caucus in Angola will provide an opportunity for the country to strengthen its relationship with the international financial institutions like the International Monetary Fund, the World Bank and the African Development Bank, and thus seek to marshal aids required for its development.
According to a Finance Ministry’s press release that reached Angop on Wednesday, the event will also contribute to a better visibility of Angola and new opportunities for the diversification of its economy.
Angola was formally appointed to chair the African Caucus Group in 2015, during a meeting held in Khartoum, Sudan, from 3-4 September 2014.
Founded in 1963 as the African Group of Governors of the World Bank Group and the IMF, the Caucus aims to strengthen the voice of the Governors of the African Continent on important issues relating to the socio-economic development of the African Region, within the Bretton Woods Institutions (World Bank and International Monetary Fund).
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Training of African Union Services Trade Negotiators kicks off in Nairobi
A week-long workshop, convened by UNCTAD and the African Union Commission, is underway to train services trade negotiators from Anglophone African countries on related negotiations under the African Continental Free Trade Area (CFTA).
The training is part of follow-up measures being undertaken by the African Union Commission AUC, in collaboration with UNCTAD, to enhance the understanding and negotiation skills of African services trade negotiators in preparation for negotiations that would take place subsequent to the June 2015 AU Summit decision to launch negotiations on the establishment of an African Continental Free Trade Area (CFTA), which are expected to be concluded in 2017.
The 50-plus participants include services trade negotiators from 19 African countries and 4 African Regional Economic Communities, as well as representatives from UNCTAD, the AUC, the UN Economic Commission for Africa (UN-ECA), the World Trade Organization (WTO), the UN Food and Agriculture Organization (FAO), the Trade Law Centre for Southern Africa (TRALAC), International Lawyers and Economists Against Poverty (ILEAP) and other independent experts.
Ms. Amina Mohamed, Cabinet Secretary, Ministry of Foreign Affairs and International Trade of Kenya opened the Workshop, with a statement delivered on her behalf by Ms. Joyce Ogundo, Director of Internal Trade of the same Ministry.
Ms. Mohamed stated that Kenya believes in the importance of trade in services, as highlighted in the recent UNCTAD report on “Unlocking the potential of Africa’s services trade for growth and development”.
She stressed that “Services are key for enhancing the competitiveness of African economies” as exemplified in the case of Kenya’s mobile-phone based money transfer and micro-financing service (M-PESA).
Ms. Treasure Maphanga, Director, Department of Trade and Industry, of the AUC, said that the African continent is serious about moving forward on the CFTA, as made evident by the launching of the negotiations on the CFTA by the June 2015 AU Summit.
She added that the negotiation guidelines adopted by members provide for the negotiations of trade in goods and trade in services concurrently to establish a CFTA in goods and services. The negotiations will build upon existing efforts in African regional economic communities, taking into account relations with the WTO and external partners.
Ms. Maphanga stressed the importance of the workshop in preparing African services trade negotiators, and announced that a second workshop for AU Francophone countries would be held in Benin in October.
Ms. Maria-Thereae Keating, UNDP Country Director and UN Resident Representative (a.i.), said that the UN believes that economic development is a key driver of poverty reduction and that international trade is a major vector of such transformation. The UN is thus committed to supporting African countries in realizing the CFTA, including in terms of services economy and development, which can have stronger developmental results.
Mr. Bonapas Onguglo, Senior Affairs Officer, UNCTAD, reiterated that services are needed to boost competitiveness in all other sectors in the economy. UNCTAD’s comprehensive work on services reflects this.
The workshop will enhance awareness and understanding of services economy issues by African services negotiators and also bolster their negotiations skills through practical exercises and simulations.
» Quick link: Training Workshop on Trade in Services Negotiations for African Union Continental Free Trade Area Negotiators
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Ethiopia first country to launch ClimDev-Africa Special Fund project
The ClimDev Africa Special Fund (CDSF) launched its first project in Ethiopia on August 3 to help the country cope with, and build resilience to, climate change by enhancing capacity in climate monitoring, data analysis, interpretation, forecasting and dissemination for use in national decision-making.
The project entitled “Strengthening Climate Information and Early Warning Systems for Climate Resilient Development and Adaptation to Climate Change in Ethiopia – (SCI-EWS)” will be implemented over a span of three years at a total cost of EUR 1 million.
Speaking at the launch, Ato Alemayehu Tegenu, Ethiopia’s Minister of Water, Irrigation and Energy, noted that, “Enhancing the capacity of the country’s National Meteorology Agency by promoting strategies that effectively manage risks; reduce vulnerability; and maximize opportunities associated with climate variability, change and extreme weather events for different socioeconomic sectors, is central to our commitment to build a fully climate resilient green economy by 2025.” Improved service delivery and cost recovery systems as a result of the project, are expected to generate additional income for the Government to ensure the future sustainability of the system together with the National Meteorological Agency.
Justus Kabyemera, AfDB ClimDev-Africa Special Fund Coordinator further stated, “This project exemplifies the importance of the ClimDev-Africa Special Fund to help mitigate the challenges associated with gathering and relaying important climate-related information on the continent – a critical step to help countries deal with climate change-related risk. In countries such as Ethiopia, in which climate change is not only recognized as a real threat, but as an opportunity as well, working towards sustainable adaptation and mitigation will help it achieve rapid economic development by promoting safe agricultural investments and boosting industrial growth.”
In addition to Ethiopia’s Minister of Water, Irrigation and Energy and staff, the launch was also attended by representatives from the Ministry of Finance and Economic Development, the African Union Commission, the United Nations Economic Commission for Africa, the African Development Bank (AfDB), ClimDev-Africa, and non-governmental organizations.
Following the launch, relevant National Meteorological Agency staff attended a three-day workshop on AfDB project implementation rules and procedures, such as procurement and monitoring and evaluation.
Ethiopia is the first country to benefit from the Fund.
About ClimDev-Africa Special Fund
Launched in November 2014, the ClimDev Africa Special Fund (CDSF) is the funding arm of ClimDev Africa, a joint programme between the African Union Commission, the United Nations Economic Commission for Africa and the African Development Bank. Housed at the AfDB, it is a demand-led fund that pools resources to finance investment activities on the ground across Africa for the generation and use of climate information for climate-resilient development. Grants are provided to projects in line with the ClimDev-Africa Programme’s goal, purpose and results areas and are implemented by national and regional organizations at all levels on the continent.