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South Africa to ‘cautiously’ reopen borders as lockdown eases (Nation)
South Africa will reopen its borders to most countries next month, the president said Wednesday, part of a wider easing of anti-coronavirus measures announced as figures continue to improve. President Cyril Ramaphosa on Wednesday said most remaining rules will be rolled back from September 20, and that international travel would “gradually and cautiously” resume on October 1st. Restrictions on movement and business have been gradually eased since June, but borders stayed sealed to avoid importing the virus from abroad. “Our economy and society have suffered great devastation,” Ramaphosa said. “It is now time to remove as many of the remaining restrictions... as it is reasonably safe to do so.”
SA commits to global socio-economic development (SAnews)
South Africa, said International Relations and Cooperation Minister Naledi Pandor, is also committed to protecting the planet for future generations to ensure the prosperity of the country, region and continent. “In broad brushstrokes, South Africa’s national interest revolves on promoting the well-being, socio-economic development and upliftment of the country’s people, protecting the planet for future generations and ensuring the prosperity of the country, region and continent.” Despite the debilitating effects of the COVID-19 pandemic, South Africa remains committed to promoting the well-being, socio-economic development and upliftment of the country’s people.
Fish the only product with a diversified market (The Namibian)
The latest trade statistics put fish exports at the top of the country's competitive products, being send to at least 10 countries around the world. This is an achievement no other Namibian product in the top five exports in volume has achieved, according to the latest trade statistics for July 2020, compiled by the Namibia Statistics Agency (NSA).Apart from being the only non-mineral product in the top five exports for many years now, the sector is slowly expanding its market from Spain – which in July accounted for 50,3% of Namibian fish.
Tanzanian industrialists revel in electrification drive (Dailynews)
Industrialists have welcomed the pledge given yesterday by CCM presidential candidate Dr John Magufuli that his government would ensure the country’s power generation capacity reaches 5000 MW in the next three years. Dr Magufuli, who seeks his second presidential term, stated yesterday that with the ongoing power projects set to beef up the national grid considerably, Tanzania will have adequate power to feed its envisaged industrialized economy, sell the surplus and get rid of power outages. CTI’s Director of Policy and Advocacy, Mr Akida Mnyenyelwa, argued that having enough and reliable power would really boost local industries production and increase their competitiveness in the market in the wake of reduced production costs. “Not only for AfCFTA, improved power supply would reduce costs of production, it will empower local industries to compete in other regional markets such as EAC and SADC,” he stated.
How Covid-19 is catalysing race for e-banking (Business Daily)
The Covid-19 pandemic looks likely to be the catalyst accelerating the reduction of physical branch networks in the banking industry, as lenders eye more uptake of digital services. The pandemic comes at a time when lenders had undertaken new measures in 2019 by cutting costs and restructuring their operations in favour of shift to online banking while focusing on increase in market share and tapping into regional markets. The last Bank Supervision Annual Report 2018 by the Central Bank of Kenya (CBK), shows the number of bank branches decreased from 1,518 in 2017 to 1,505 in 2018. This means 13 branches were closed.
Reform measures augmenting private banks’ capacity (Ethiopian Press Agency)
The various reform measures implemented in the financial sector have bolstered private banks’ capacity with the latest being the bank note change which would bring the unbanked community to the sector. In an unprecedented meeting that housed cabinet Ministers, security heads as well as bank board chairs and CEOs together on Monday, Prime Minister Abiy Ahmed assured of the financial sector’s improvement resulted from the reform measures taken thus far. “By any standards, the financial sector has improved hugely.” administration rescued the economy from spiraling downward. It is to be noted that the government was unable to pay public servants’ wages and the country had been listed under a high risk of debt distress, not to mention the dwindling of bank reserve and export revenue.
Prices of flour, rice, beans, tomatoes, pepper, others jump, as low patronage hits major markets (Nairametrics)
The persistent increase in the price of food items across major markets in Lagos State continues to hit harder on consumers, as local and foreign rice, tomatoes, pepper, flour amongst others, recorded significant surges in their prices Despite the ease of lockdown in the country, the prices of household items continue to trend upwards, as traders across Lagos markets have once again lamented the sustained decline in patronage. This is according to the latest Household Market Survey conducted by Nairalytics, the research arm of Nairametrics.
Illicit Gold Trade Thrives with Impunity in the Democratic Republic of Congo (Africanews)
Traders and exporters who are legally registered in the DRC, Rwanda, and Uganda are operating without apparent fear of sanction, even after being publicly named by the United Nations and international organizations year after year as contributing to the illicit trade of artisanal DRC gold. In its latest report, "The Intermediaries: Traders Who Threaten the Democratic Republic of Congo’s Efforts for Conflict-Free Gold,” IMPACT documents how registered traders and exporters provide a sheen of legality by declaring a small percentage of their gold exports while pocketing massive profits from the illicit trade. They thwart attempts to disrupt their scheme by reconfiguring their operations across the region when necessary or by creating phantom entities.
Regional and continental news
Trade Experts Discuss Trade Negotiation Modalities in Time of COVID-19 (COMESA)
Trade experts from the 21 COMESA Member States met today to review progress on trade negotiations between them and review progress towards concluding Trade in Services negotiations. The virtual meeting, which was the 8th for the COMESA Technical Working Group on Trade in Services, considered the complexities prevailing during this COVID period and provided technical and policy guidance from the Member States regarding the negotiations. COMESA considers Trade in Services as a fundamental economic activity globally given its contribution to job creation, building competitiveness and significantly contributing to economic growth. It creates the need for Member States to streamline their policies and promote it among themselves.
AfCFTA urged to ensure level playing field for African sugar producers (New Business Ethiopia)
The African Sugar Development Task Force (ASDTF) called on the African Continental Free Trade Area to ensure a level playing field for African sugar producers as member state negotiators aim to finalise trading rules under the African Continental Free Trade Agreement (AfCFTA) by January 2021. “The AfCFTA provides a unique opportunity to create preferential markets for African products within the African continent, facilitating preferential trade amongst member states, and reduce or eliminate high tariffs that have restricted intra-continental trade over decades,” said Eltayeb. Africa has the natural resources to fill the growing supply gap, but it is lacking policies required to develop fair intra-African sugar trade flows, increase demand for African-produced sugar and attract billions of dollars of foreign and regional investment into the sector which in turn will create thousands of new direct and indirect jobs
Africa: Lift barriers, increase trade (Al-Ahram Weekly)
The 2020 Africa Agriculture Trade Monitor (AATM), published by the International Food Policy Research Institute (IFPRI), has recently been released, providing an analysis of continental and regional trends in African agricultural trade flows and policies. According to the report, countries should not let the pandemic stop progress towards economic integration. It said that agreements like the AfCFTA could provide not only a solid basis for long-term economic development, but also a means of effectively fighting future pandemics by facilitating the cross-border trade of food and medical goods.
African leaders welcomed the opening of a regional office of the Global Center on Adaptation on Wednesday, voicing hopes it will spur the continent’s efforts to combat climate change. In speeches marking the virtual launch of GCA Africa, the leaders said the Center could also provide an impetus for a more resilient recovery after COVID-19, which they said had compounded climate-induced vulnerabilities. “In the post-COVID period, our objective should not only be to recover and build better but to do so in a climate-conscious way,” said Ethiopian President Sahle-Work Zewde.
Africa rising: Development calls for further cooperation (CGTN)
From the “African Century” to “Africa Rising,” Africa’s economy has been growing in recent years. Unfortunately, 85 percent of Africans live on less than 5.50 U.S. dollars per day, poverty is a challenge for sustainable development in Africa. Both the UN SDG 2030 and the African Union’s Agenda 2063 listeed “poverty reduction” as their primary goal. However, with Covid-19 hitting Africa, what does the continent need to do to facilitate sustainable development and further reduce poverty? What are the new opportunities rising for sustainable development in Africa?
Global news
Making the WTO Work for Africa | by Hippolyte Fofack & Pat Utomi (Project Syndicate)
Three Africans are among the eight candidates to become the World Trade Organization’s next director-general. But regardless of who eventually prevails, Africa must demand a level playing field from the WTO. Trade is vital for Africa’s development and to generate enough good jobs to absorb the 17 million young people who enter the labor market every year. But, for too long, global trade regulations have left the continent holding the short end of the stick. Africans are hoping that one of these three highly competent candidates will emerge victorious when the winner is announced in November. But regardless of who eventually prevails – three of the eight candidates will be eliminated after the first round – Africa must demand a level playing field from the WTO.
BRICS stands for rules based on multilateralism: S. African official (Xinhua)
BRICS stands for rules based on multilateralism and governance, South Africa’s International Relations and Cooperation Minister Naledi Pandor said here on Wednesday. Pandor made the remarks while giving a lecture on the topic of “South Africa’s place in the changing global order” at the Wits School of Governance on Wednesday evening. “BRICS nations have shown unshakable confidence in and reinforce support for the rules-based international system and for multilateralism. We believe that BRICS is an important forum for global political, economic and financial partnership and for promotion for the world that is equitable, balanced and shaped on the important pillars of multilateralism and international law,” said Pandor.
EUIPO launch of AfrIPI aims to shake up trademark registration in Africa (World Trademark Review)
AfrIPI is the EUIPO’s first IP-focused project that collaborates with African jurisdictions. Expected to last four years, it was launched in February 2020 and the Project Steering Committee’s inaugural meeting was on 7 September 2020. At the inaugural meeting, AfrIPI’s general plan and future activities for the coming years were discussed and approved, the main objective of the project being to increase the protection and promotion of IP rights in Africa, thus contributing to national economies, trade and business across the continent. AfrIPI also aims to reinforce EU and African cooperation to further implement all IP-related aspects of the African Continental Free Trade Area (AfCFTA).
India’s African oil imports hit 10-month high in August: Shipping data (@businessline)
India’s oil imports from Africa jumped to their highest in 10 months in August as refiners switched out more expensive crude from the Middle East, shipping data provided by trade sources showed. The world’s third-biggest oil importer shipped in about 3.95 million barrels per day (bpd) of oil in August, the highest volume since April, with African nations accounting for about 17.5 per cent, the data showed. He said in order to raise revenue, Nigeria was supplying more oil in July than it pledged under a production cut agreement between OPEC and its allies, while Angola was scouting for a new market after the Chinese cut purchases.
Africa’s Mineral Wealth Gives it Key Role in New Global Economy (Chatham House)
Citizens of resource-rich countries are demanding greater social and economic benefits from their natural resource endowments, and governments have moved to exert increased control of resource rents – for national benefit or, in the worst cases, personal enrichment. In Africa, these tensions are exacerbated by the vestiges of colonialism and narratives of exploitation, legacies of prior waves of nationalization – and now the devastating impact of the COVID-19 pandemic on societies and economies across the continent. For international mining companies and investors, ‘African agency’ is often synonymous with state intervention, resource nationalism, and risk amid unquestionable opportunity.
Remarks at the High-Level Launch of the Global Center on Adaptation Africa (IMF)
For the IMF, the topic of climate adaptation is one of great significance. Unless we work everywhere – and especially in the most vulnerable parts of the world – to address climate change and adapt to its consequences, we cannot possibly achieve economic stability, growth, employment and improvements in living standards that are at the heart of our mandate. Yesterday, with my colleague the Director of the Africa Department, Mr Abebe Aemro Selassie, I published a blog charting the path for a resilient recovery in Sub-Saharan Africa. And it is focused on integrating resilience into the recovery from the COVID-19 crisis. In our recent Regional Economic Outlook for Sub-Saharan Africa, we recommend the three areas of focus: enhancing key infrastructure, investing in people and strengthening coping mechanisms.
WTO issues report on measures to expedite access to COVID-19 critical goods, services
The WTO Secretariat has published a new information note on how WTO members have used trade measures to expedite access to critical medical goods and services as part of their responses to the COVID-19 pandemic. The shortages of medical personal protective equipment encountered around the world in the early phase of the pandemic have eased, as production and trade have expanded to meet the unparalleled demand spike. Initial data for 41 countries indicates trade in medical goods grew by 38.7 per cent in the first half of 2020, the Secretariat said, although sourcing of certain products remains a challenge for some developing countries.
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S Africa’s coronavirus loan scheme lags, hobbling govt relief package (Reuters Africa)
South Africa’s National Treasury plans no further easing of its coronavirus loan scheme criteria to stimulate uptake, it told Reuters, meaning almost a third of the government’s 500 billion rand ($30 billion) relief package may end up going unused. The 200 billion rand loan programme is a pillar of South African efforts to shield small businesses from the impact of the pandemic. Conditions were tweaked in July, including expanding who qualifies and extending the repayment grace period, after relatively few firms applied for the loans.
Ramaphosa’s economic recovery plan gets the green light from business, labour (Engineering News)
The National Economic Development and Labour Council has agreed to an economic recovery plan for South Africa. According to a statement issued by the Presidency on Tuesday, following a meeting between President Cyril Ramaphosa and Nedlac - a body comprised of representatives of government, business, labour and community - the details of the plan will be announced once it is finalised by Cabinet. The country’s economy is set to contract anywhere between 7% and 13% this year due to the damaging impact of the lockdown that was instituted to curb the spread of Covid-19. Most recent data from Stats SA showed that the economy contracted by 51% quarter on quarter on an annualised basis as a result of the lockdown, which saw economic activity grind to a halt for five weeks.
UK Government Donates R50m to Solidarity Fund for Projects Supporting and Promoting Women (The Department of Trade Industry and Competition)
The Solidarity Fund announced the receipt of a R50m grant from the government of the United Kingdom (UK). The grant is aimed at extending the Solidarity Fund’s ongoing efforts to counter the repercussions of the COVID-19 pandemic in South Africa – focusing specifically on projects supporting and promoting women. This contribution forms part of the UK’s international COVID19 response and recovery efforts, and signals their support for the Solidarity Fund as an independent, South African run initiative. The sum earmarked for the Fund amounts to a £2.15m (R50m) donation that will be used to bolster high priority initiatives currently supported by the Fund. To date, the UK has committed £6.5m in support of South Africa’s response to the pandemic.
South Africa ranks 90th in economic freedom rankings (Moneyweb.co.za)
According to the 2020 Economic Freedom of the World report recently published by the Fraser Institute (which is based on 2018 data), South Africa climbed up from 101 in 2017 to 90 in 2018 (out of 162 countries). However, a lot has happened since 2018, and going up in the rankings doesn’t necessarily mean that there is much improvement. The study bases economic freedom on personal choice, voluntary exchange, freedom to enter markets and compete, and security of the person and privately-owned property, and includes a measure to gauge the extent to which women have the same economic freedom as men.
Simplicity is key if SA is to harness technology (New Frame)
The government, labour, business and societal organisations have identified the economic promise of the so-called fourth industrial revolution (4IR) as a focus area to rescue South Africa from its economic paralysis. “Digitisation is accelerating globally. Countries and populations that are not keeping up will be left even further behind. In SA this will lead to deeper inequalities. The process of ensuring universal access to affordable broadband and digital public services has become even more critically important and should be prioritised,” says the document. But compared with global competition, South Africa is almost a backwater when it comes to developing coherent and comprehensive policy on 4IR. A government document on the country’s economic recovery now and post Covid-19, presented at the Nedlac session in August, speaks volumes.
Rampant corruption hurts Kenya’s economic freedom score (The Star)
Kenya has trailed its East Africa’s peers in the latest World Economic Freedom Index, ranking position 132 globally on rampant corruption, regulatory efficiency and high tax burden. The annual report by the Heritage Foundation, a leading think tank, merits the level of economic freedom of a country by measuring four parameters: rule of law, government size, regulatory efficiency and open market.The survey ranked Kenya as ‘mostly unfree economy’ hampered by weak rule of law (especially government integrity) and less-than-stellar performance in investment freedom and financial freedom.
Kenya’s economy set to grow by less than 2.5 percent (Ventures Africa)
Kenya’s economy is expected to grow by less than 2.5 percent this year, Kenya’s financial minister Ukur Yatani said during a virtual event held to launch budget-making for the 2021/22 financial year. At the launch, the minister revealed a 10 percent drop in government revenue from August taxes, partly due to tax cuts announced in April to support consumer demand in the face of the pandemic. Yatani warns that the coronavirus crisis is likely to cause a major economic shock, due to loss of jobs, contraction in tourism, and a drop in government revenues.
Efforts to close financial disparities in place (Dailynews)
The government has been implementing various strategies aimed at reducing economic and financial disparities via financial inclusion for those groups that are traditionally excluded from the formal financial sector. The need to build an inclusive and effective financial system led to establishment of the National Financial Inclusion Framework initiative, phase one (2014-2016) and second phase 2018-2022 implemented under the Financial Inclusion National Council. The first framework focused on building infrastructure to facilitate access of financial services ready to be used by Tanzanians.
Tanzania lifts ban on Kenyan airlines (Nation)
Kenyan airlines have finally been allowed to land in Tanzania, bringing an end to the airspace feud between the two countries. This is after the Tanzania Civil Aviation Authority (TCAA) announced that it had lifted the suspension that hit Kenyan airlines. In a statement, TCAA director general Hamza Johari said the authority was acting on reciprocal basis after its Kenyan counterpart, the Kenya Civil Aviation Authority (KCAA), included Tanzania on a revised list of countries exempted from the 14-day mandatory quarantine upon arrival.
Ethiopian Airways readies to service Zim route, OR Tambo re-opening critical (The Chronicle)
ETHIOPIAN Airways has become the first regional airliner to confirm resumption of service into Zimbabwe post Covid-19 with first flight into Victoria Falls scheduled for October 6. However, aviation experts believe the re-opening of OR Tambo airport in South Africa is key to revival of the aviation industry in the Sadc region. Government recently gave greenlight to domestic and international flights as it lifted the ban on domestic and international travel. Domestic and foreign travel had been banned on March 30 as the Government imposed measures to curb the spread of Covid-19 at a time when most cases were imported. The global pandemic came at a time when airlines were gradually increasing capacity and frequency due to demand.
The World Bank Group’s Board of Executive Directors today approved a US$80 million grant from the International Development Association to support the government Ethiopia to boost agricultural productivity and enhance market access for smallholder farmers. According to the World Bank’s 2019 Poverty Assessment for Ethiopia, agricultural growth was a key driver of poverty reduction over the past decade. Additional financing for the Second Agricultural Growth Project (AGPII) will further increase the economic potential of Ethiopia’s agricultural sector.
Zim to save US$60m in wheat imports (The Herald)
Zimbabwe is expected to harvest nine months’ supply of wheat from the 2020 winter crop, saving the Government up to US$60 million in imports. While the county will import to cover the remaining three months supply, the Ministry of Lands, Agriculture, Water and Rural Resettlement will introduce summer wheat production starting with the 2021-2022 season to ensure wheat self-sufficiency and cut future imports.
Nigeria moves to regulate crypto currencies, other digital investments (Premium Times Nigeria)
Nigeria’s Securities and Exchange Commission (SEC) on Monday announced that it would begin to regulate digital currencies and crypto-based companies. SEC said all Digital Assets Token Offering (DATOs), Initial Coin Offerings (ICOs), Security Token ICOs and other Blockchain-based offers of digital assets within Nigeria or by Nigerian issuers or sponsors or foreign issuers targeting Nigerian investors, shall be subject to the regulation of the Commission.
Regional and continental news
The African Leaders for Nutrition (ALN) have unveiled a position paper calling upon African Heads of State and Governments to ensure that financing for nutrition is included in their country’s COVID-19 response and recovery plans
Embedding Nutrition within the COVID-19 Response and Recovery recommends that countries maintain and increase the level of funding allocated to nutrition to safeguard previous efforts to address malnutrition, and ensure there are no gaps within their multi-year nutrition programmes in immediate, medium-term and post-pandemic recovery COVID-19 responses.
EAC urged to Design post-COVID-19 Business Recovery program for Women (East African Business Week)
East African member states have been urged to come up with COVID-19 Business Recovery Programs targeting most traders in the informal sector particularly Women engaged in cross border trade. Women and Business Activists in the region say COVID -19 has greatly affected Women Business Communities especially those who are engaging in cross border trade. This came as a result of the closing of regional Borders. “The closing of the borders negatively impacted on the lives of cross-border traders especially women.
“All their capital was consumed thus the need for the EAC to come up with the recovery programme that will support Women in Business to access cheap loans to finance and restart their businesses,” noted Jane Nalunga the Executive Director Southern and Eastern Africa Trade Information and Negotiations Institute (SEATINI) Uganda
Stations meant to decongest East Africa corridor set for (Business Daily)
The Kenya Revenue Authority (KRA) and Northern Corridor stakeholders will this month begin inspection and certification of roadside stations (RSS) aimed at decongesting and reducing accidents. The RSS programme, which also seeks to identify safe places for cargo crew, was launched in 2015 and has so far identified 141 roadside sites within East Africa Community member states.
“The Northern Corridor Member States are committed to develop Roadside Stations as an integral part of transport infrastructure services along the corridor and to develop and adopt policies and regulatory frameworks for promoting RSS in partnership with the private sector,” said Northern Corridor Transport and Transit Authority (NCTTA) executive secretary, Omae Nyarandi.
Tanzania Shocked by EALA MPs’ Greed; Blocks Plan to Borrow $2m for Video Conference Allowances (chimpreports.com)
The Government of Tanzania has rejected a request by the East Africa Legislative Assembly (EALA) to borrow about $2m from the general reserve account to pay allowances for lawmakers. “With regret, I wish to inform you that the United Republic of Tanzania was not consulted and in that respect has not consented to the borrowing of $1.5m and $165,339 from IUCEA and LVFO, respectively,” said Tanzania’s Foreign Affairs Ministry spokesperson, Amb Wilbert Ibuge in a letter to EAC SG Liberat Mfumukeko dated Sept. 10, 2020.
Energy infrastructure development will unlock the region’s vast potential (Chronicle)
There is an urgent need to beef up energy infrastructure development within the Common Market for Eastern and Southern Africa (Comesa) – Indian Ocean bloc so as to unlock the region’s vast economic potential. According to Comesa, a 21-member trading grouping, power outages being experienced in the Eastern and Southern Africa-Indian Ocean region continue to negatively affect productivity, leading to Africa losing 12,5 percent of production time compared to seven percent for South Asia.
Expansion set to create Horn of Africa logistics hub (Riviera)
This first phase of development is scheduled to be completed by Q1 2021. Further phases could follow to raise container capacity further. Developments include extending the existing quaysides with a 400-m quay for berthing ultra large container ships. “The phase 1 expansion project will increase the port’s capacity and further strengthen Berbera Port as a major regional trade port servicing the Horn of Africa,” said DP World Berbera chief executive Supachai Wattanaveerachai.
Nigeria awaiting other countries’ endorsement of development bank project for West, Central Africa (Premium Times Nigeria)
The Nigerian government says it is waiting for the acceptance of two-third of Member States to proceed with the Regional Maritime Development Bank project. For the creation of the bank, the Maritime Organisation of West and Central Africa(MOWCA) had earlier reached some decisions that it expects all its Member States to meet. The focus of the bank will be the growth and development of maritime in West and Central Africa with a view to raising debt and equity capital of US$850 million and US$150 million respectively.
Charting a Path for a Resilient Recovery in Sub Saharan Africa (IMF Blog)
As we all continue to grapple with the COVID‑19 crisis, policymakers also need to look ahead. Countries need to ensure that the vast global fiscal support deployed to fight the pandemic also works to build a smarter, greener and more equitable future. Nowhere is that more important than in sub‑Saharan Africa. It is where the needs are greatest and also home to the world’s youngest population, creating added urgency to act now to build forward better. Together, we need to chart a path to a more resilient recovery.
Global news
Food safety part of the FAO’s COVID-19 response efforts (Food Safety News)
Food safety standards and trade is one of seven areas in the Food and Agriculture Organization’s COVID-19 response and recovery program. The United Nations’ agency is calling for $1.2 billion in initial investment to support efforts. The food safety part has a budget of $50 million and a timeframe until 2024. Trade measures have been a common feature of the immediate policy response to the outbreak such as import restrictions because of food safety concerns that are not necessarily science-based, according to the FAO.
Food and Agriculture Indicators Reveal Impacts of Pandemic on Data Collection (IISD SDG Knowledge Hub)
The Food and Agriculture Organization of the UN (FAO) has released its second SDG Progress Report. The report titled, ‘Tracking Progress on Food and Agriculture-related SDG Indicators 2020: A Report on the Indicators under FAO Custodianship,’ was released on 15 September 2020. The first such report, issued in 2019, found that the world was not going to meet most of the SDG targets related to food and agriculture by 2030. In the second report, the FAO finds that the COVID-19 pandemic has not only made it even more difficult to achieve the SDGs, and more unlikely that the food and agriculture targets will be met on time, but it has also made it more difficult to monitor progress.
Mexican nominee to WTO top job pledges to prioritise Africa (GhanaWeb)
A former Deputy Director-General of the World Trade Organisation (WTO) and Mexico’s nominee for the top position of the global trade institution, Dr. Jesús Seade Kuri, has promised to put Africa at the center stage of his leadership should he be voted to lead the organisation. Dr. Kuri, in an exclusive op-ed published in the Business24, did not only recount his long experience working in various capacities in multilateral agencies serving the needs of the continent, but promised to ensure the selection of his deputy from Africa, preferably a female. “I will make every effort to ensure Africa has a (possibly female) DDG, so that we have not one but two senior officers who are familiar with Africa at the top of the organisation,” he said.
The new development partnership: Smart aid for Africa (Open Access Government)
Jong-Dae Park, Ambassador of the Republic of Korea in South Africa, discusses smart aid and sustainable development for Africa post COVID-19. The world is plagued by COVID-19 and it is wreaking havoc on our daily lives. However, while we fight this pandemic that is like nothing that has ever come before in our lifetime, we might take this opportunity to genuinely reflect on what needs to be done as we try to work towards a post-pandemic era. One of the things that comes to my mind as a fundamental problem to tackle is Africa’s development.
Women, ICT and emergency telecommunications: opportunities and constraints (ReliefWeb)
This report sets out to assess whether ICTs used to reduce disaster risk are benefiting women and men equally. It does so by considering vulnerability alone as it examines women’s circumstances in relation to men’s in the same geographies and with the same ICT infrastructure. It examines gendered disaster vulnerability as well as the gendered digital divide. In each case, vulnerability is considered from the lens of affected persons’ capacity to mitigate and prepare for (before), respond to (during) and recover from (after) disasters. These examinations and a range of ICT initiatives currently used to reduce gendered asymmetries, inform recommendations for ICT-enabled disaster risk reduction (DRR) for the most vulnerable. DRR refers to the systematic approach to identifying, assessing and reducing the risks of disaster. It aims to reduce socio-economic vulnerabilities to disaster as well as to treat with the environmental and other hazards that trigger them.
OECD Economic Outlook, June 2020: Building confidence crucial amid an uncertain economic recovery
The spread of Covid-19 has shaken people’s lives around the globe in an extraordinary way, threatening health, disrupting economic activity, and hurting wellbeing and jobs. Since our last Economic Outlook update, in early March, multiple virus outbreaks evolved into a global pandemic, moving too fast across the globe for most healthcare systems to cope with effectively. To reduce the spread of the virus and buy time to strengthen healthcare systems, governments had to shut down large segments of economic activity. At the time of writing, the pandemic has started to recede in many countries, and activity has begun to pick up. The health, social and economic impact of the outbreak could have been considerably worse without the dedication of healthcare and other essential workers who continued to serve the public, putting their own health at risk in doing so.
Europe and Africa at a crossroads (ISS Africa)
Over the past decade, the African Union (AU) has shown increasing ambition in international relations. The AU Commission has tried to structure relations with strategic partners to coordinate and align their interventions with the African priorities defined in Agenda 2063. While it’s premature to talk about an AU foreign policy, the AU reform framework reflects on the organisation’s role in Africa’s relations with the outside world, including the European Union (EU). But can African states consider an EU-Africa relationship beyond aid? And are they able to create enough consensus to agree on important policies?
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Master plan starts to encourage poultry sector expansion (Engineering News)
South African poultry producers have pledged to invest R1.7-billion towards expansion and improvement of productive capacity in the country. South Africa’s poultry output grew by 5% during the first eight months of the year, compared with the first eight months of last year, despite the challenges to the operating environment that were posed by Covid-19. In a prior statement, the South African Poultry Association said the industry aimed to increase production by between 10% and 20% by the end of 2022, which will require investment in processing facilities as well as farming to produce the chickens.
SA Tourism pins hopes on govt reopening borders soon to help struggling sector (Eyewitness News)
South African Tourism on Monday said that it was looking closely at government to announce a date to reopen the country’s borders.SA Tourism CEO Sisa Ntshona said that the country was now in the “amber” zone, a good space to be in to announce a date. “What we are looking at now is probably the conditions that will come with the opening of the borders.” He said that it would take about two years for the tourism industry to recover.
Illicit trade thriving during Covid-19 (New Straits Times)
When the Covid-19 pandemic hit South Africa in March, the government responded with heavy-handed measures, including a prohibition on alcoholic drinks and tobacco, hoping that strict restrictions would reduce violent crime, social gatherings for a weekend of binge-drinking, and health issues. While the ban made headway with murder rates reported to have been reduced by 63 per cent, it also partly backfired. Illicit trade of alcohol is now booming in the country as organised crime groups have pounced, smuggling in contraband products for a quick profit. The production of counterfeit alcohol has also increased, becoming a potential health threat.
Green industries expected to aid economic recovery (SAnews)
The Green Economy is one of the four sectors that have been prioritised by government to assist with economic recovery, says the Minister of Environment, Forestry and Fisheries, Barbara Creecy. “South Africa has realised that green industries can open up new possibilities for development and assist in creating much needed jobs. The waste management sector has strong potential to innovate and improve socio-economic conditions, and contribute to sustainable development and resource use,” Creecy said.
Eswatini has Developed Trade Facilitation Instruments for Small Scale Border Traders (COMESA)
The government of Eswatini has developed a national Roadmap for the implementation of the COMESA Simplified Trade Regime (STR) as well as the Trade and Transportation Facilitation instruments for the Small-Scale Cross Border Traders (SSCBT). The Roadmap is under consideration by senior management in respective ministries and institutions in the country. Director of Micro- Small and Medium Scale Enterprises (MSME) in the Ministry of Commerce, Industry and Trade of Eswatini, Mr. Mluleki Sakile Dlamini opened the meeting and emphasized the importance of small-scale cross border trade. He outlined the challenges that SSCBTs face in conducting their businesses noting that the MSME sector contributed to incomes and livelihoods.
Ecocash Behind Spiralling Prices Of Basic Commodities – Mnangagwa (NewZimbabwe.com)
President Emmerson Mnangagwa has said the steep price hike for basic commodities experienced in the country in recent months was the creation of mobile money giant, Ecocash. “We went through hardships, where prices were going up every day, the exchange rate was flying,” said Mnangagwa. “We then set up a committee to look into the issue. We then discovered that there was up to $8, 4 billion which was circulating outside the banking system, which money in financial terms is called phantom money.”
Zimbabwe ready for oil, gas drilling (The Chronicle)
Zimbabwe’s economy is headed for exciting times ahead following the recent announcement by Invictus Energy, the Australia listed resources firm that is exploring for oil and gas in the Muzarabani, that it will start drilling Zimbabwe’s first oil and gas wells within its prospective area in October next year. The Muzarabani prospect has ticked all the relevant boxes to warrant millions of US dollar investment into drilling for oil or gas. Thus far, US$3,5 million has been invested in preliminary work and processing of secondary data, but the actual sinking of the first oil and gas wells in the country will cost upwards of US$15 million.
Why Kenya lost Uganda pipeline deal (Nation)
Nearly four years after Uganda abandoned Kenya in building an oil pipeline that would have transported its oil to Lamu, it has now officially signed a Sh410 billion ($3.5 billion) deal with Tanzania, leaving Nairobi to walk alone. The deal signed on Sunday between President John Magufuli and his Ugandan counterpart Yoweri Museveni will see Kampala route its oil exports through Tanzania, through the 1,445-kilometre crude oil pipeline. The construction is expected to start before the end of the year and it will help Uganda exploit oil discovered near Lake Albert in 2006. Reserves in the area are conservatively estimated at some 1.7 billion barrels.
Avoid trade war with Comesa, SADC blocs, Kenya told (The Star)
The EAC has been according preferential treatment to goods from COMESA and SADC under Section 112 of the EAC Customs Management Act, 2004. However, this lapsed in December 31, 2019, a time when member states were expected to have adopted the new trade deal. “We have been instructed by the Commissioner Customs and Border Control to reject all Comesa entries and notify the clearing agent or importers to pay the requisite taxes,” a KRA internal communication seen by The Star read. The KNCCI is now worried the move could lead to a fall-out between Kenya and other trading blocs.
High Taxes And Levies May Slow Down The Tourism Sector Recovery (Soko Directory)
Tourism and hospitality stakeholders have urged the government to scale down taxes and levies in the tourism industry so as to attract more domestic visitors and recreate jobs for the youth. They argue that the industry risks extreme revenue drop unless taxes and levies at the national and county levels are harmonized. “The government needs to reduce too much burden on the hospitality and tourism sector. Kenya risks losing business if prices offered are way above our neighboring competitors for instance Tanzania, Rwanda, South Africa, and other countries,” said Hasnain Noorani, Kenya Coast Working Group Chair and Managing Director for PrideInn hotels.
South Sudan citizens decry skyrocketing food prices (Xinhua)
South Sudan’s citizens on Monday decried skyrocketing prices of basic commodities like food due to the deteriorating economic situation in the country. South Sudan depends significantly on essential commodities imported from neighboring Kenya, Sudan and Uganda. Moses Lado, a vendor at Jebel market, said that food price hike had negatively impacted his business amid the devaluation of the local currency. “Prices of food in the market have doubled in the recent past while destabilizing livelihoods,” said Lado.
Ethiopia is demonetizing its economy with new currency to tackle hoarding and illegal trade (Quartz Africa)
The Ethiopian government has unveiled a set of new bank notes as a part of its efforts to curb cash hoarding, illegal trade activities, and illicit financial flows in an already struggling economy. “Even though changing currency is costly and expensive, it is very important to the economy,” says Wasihun Belay, a development economist based in Addis Ababa. Although demonetization is an economic strategy used from time to time in developing countries to stabilize the currency and ease inflation it is not without its risks. Economists often warn if mishandled it could trigger market chaos and uncertainty as citizens scramble to swap their notes.”
Nigeria reels from twin crises that threaten food availability (Reuters)
Twin crises, floods and maize shortages, come just after movement restrictions and financing difficulties caused by COVID-19 containment measures complicated spring planting. Some farmers and economists say it could push Nigeria, Africa’s most populous nation, into a food crisis. Rice is the country’s staple grain, and chicken is a core protein. “There is a real fear of having food shortages,” Arc Kabir Ibrahim, president of the All Farmers Association of Nigeria told Reuters. “The effect on the food system is going to be colossal.”
Price hikes anger Nigerians as fuel subsidy ends (Eyewitness News)
Tempers have risen in Nigeria along with prices after the oil-rich nation dumped a controversial petrol subsidy system in the face of a coronavirus budget crunch. The cost of fuel at the pump has risen by around 15% in recent days, hitting a record high of 162 naira per litre ($0.42, 0.36 euros), or $1.55 / 1.36 euros a US gallon, after the government pushed on with deregulation. While such prices may sound cheap in many countries, the hike is a major blow to cash-strapped consumers who see cut-price petrol as one of the few tangible benefits they get from their dysfunctional leadership.
Deregulation of Nigeria’s oil downstream sector not possible in 2020 – Investigation (Vanguard News)
There are strong indications that the downstream sector of Nigeria’s petroleum industry would not be fully deregulated in 2020 as the enabling factors, especially structures, institutions and the Petroleum Industry Bill, PIB, are not yet in place. Under a regulated market regime, the prices of petroleum products are supposed to be determined by the forces of demand and supply without much intervention. But investigation by Energy Vanguard, showed that the Petroleum Equalisation Fund, PEF, which has the responsibility to settle the cost of bridging petroleum products from one part of Nigeria to another, under a deregulated regime, was still performing its role, despite claims that the sector has been deregulated.
Regional and continental news
Boosting African regional value chain development in response to COVID-19: The catalysing role of the AfCFTA (Trade 4 Dev News)
COVID‑19 has magnified Africa’s reliance on imported pharmaceuticals (both final and intermediate products) and amplified the urgency to build competitive, resilient and robust value chains in this sector. Not only are many of the main providers of Africa’s pharmaceuticals heavily hit by COVID‑19 (with main sources of imports being the EU-27, India and Switzerland), but many have also limited exports of medical supplies and medicines associated with the pandemic, putting many African countries in perilous positions.
But the African Continental Free Trade Area (AfCFTA) agreement serves as the leading framework for boosting intra-African trade. Swift implementation will be crucial to fast-track the development of “made in Africa” brands embedded in competitive and robust regional value chains. In fact, a leading objective of the AfCFTA is to ‘stimulate production through the development of regional value chains, as well as ensuring that manufacturing, agro-processing and other activities across the continent are stimulated to supply the market’. The AfCFTA therefore offers an opportunity for the continent to recommit itself to industrial development, in a way that will reduce its high trade dependence on non-African partners, and to position itself more strongly in the face of future global shocks.
The authors: Karishma Banga, Jodie Keane, Max Mendez-Parra, Laetitia Pettinotti, Lily Sommer
Judge proposes new approaches to improve on enforcement of decisions of ECOWAS Court (Apanews.net)
A judge of the ECOWAS Court of Justice, Justice Dupe Atoki, has expressed concern at the ‘unsatisfactory’ level of enforcement of the decisions of the Court by Member States, which stood at 34 percent and suggested the involvement of political actors in the enforcement process in order to emulate the best practices from other jurisdictions. In the paper, on the ‘Enforcement of judgments of the ECOWAS Court of Justice,’ Justice Atoki suggested that the President of the Court should also be allowed to provide a report on the Court to the political authorities to apprise them of the judgments of the Court and their enforcement status for a holistic understanding of the Court.
Ghana International Trade and Finance Conference slated for October 27 (GhanaWeb)
The Ghana International Trade and Finance Conference (GITFIC) in partnership with the Accra Metropolitan Assembly (AMA) will a host dialogue on the African Continental Free Trade Area (AfCFTA) on October 27, 2020. The AfCFTA dialogue is also in collaboration with the Association of Ghana Industries (AGI) to raise awareness, empower and encourage all Member States to take actions necessary to build the logistics and the infrastructure critical for the successful outcome of the AfCFTA.
The African Export-Import Bank (Afreximbank) and the International Islamic Trade Finance Corporation (ITFC), have partnered with the African Organisation for Standardisation (ARSO), to launch a new Arab-Africa Trade Bridges Program (AATB) initiative called the Harmonisation of Standards for Pharmaceutical and Medical Devices in Africa, aimed at promoting the quality and safety of medicines and medical devices imported or produced on the continent. Harmonized product standards are critical to the implementation of the African Continental Free Trade Agreement (AfCFTA), ensuring that producers of goods on the continent comply with one shared set of minimum regulatory and customer quality requirements, in turn allowing them to supply the
The Next Generation Africa Climate Business Plan: Ramping Up Development-Centered Climate Action (World Bank)
Economic growth and shared prosperity in Sub-Saharan Africa will be increasingly undermined if vulnerabilities to climate change are not addressed. Climate impacts, which are already being felt will escalate significantly, as early as 2030, causing many low-capacity countries to be even more vulnerable. Given the climate sensitivities of multiple engines of growth, agriculture, natural capital, and infrastructure, the urgency for countries to ramp up climate-smart development at scale and across the growth spectrum is an imperative. The Next Generation Africa Climate Business Plan provides a platform to further galvanize climate action by prioritizing its focus on the region’s core development challenges and priorities.
How Africa can move from net food importer to exporter (The New Times)
Africa remains a net food importer, meaning that it imports more foods than it exports. And, increased food demand and changing consumption habits are leading to Africa’s rapidly rising food import bill. AfDB said that Africa’s food imports include wheat, sugar, rice, beef, and soybeans, yet, these commodities can be produced on the continent. By continuing to pay for food to be imported, the Bank said that Africa is losing precious foreign exchange, so it must quickly eliminate the negative balance, and start to sow, grow, process, consume, and ultimately to export the food itself. It added that export of primary agricultural production is still very high in Africa compared to other regions of the world.
Global news
Kenya-US free trade deal won’t come easy (Business Daily)
Some 38 African countries are eligible for benefits under the African Growth Opportunity Act (Agoa) and the ongoing negotiations for a Free Trade Agreement (FTA) between Kenya and the US should be a concern to all of them, especially the least developed. The concern is that the model agreement proposed by Washington is a FTA and not a development cooperation agreement such as that signed between the US and the Southern African Customs Union (SACU).
Ethiopia: U.S.-Ethiopia Relations Take A Wrong Turn (allAfrica.com)
The Trump administration’s decision to suspend and delay development assistance to Ethiopia over the filling of the new Grand Renaissance Dam (GERD) is misguided and shortsighted. The move will undermine Washington’s relations and influence in one of Africa’s most significant states. The decision taken in late August was intended to push Ethiopia into accepting a negotiated solution favored by Egypt. At issue is a timetable for filling the new dam and an agreement on how water from the dam will be allocated to Egypt and Sudan.
Related: Ethiopia does not need permission to fill dam – envoy (The Star)
Annual Goalkeepers Report Shows COVID-19 Has Stalled 20 Years of Progress (Bill & Melinda Gates Foundation)
The Bill & Melinda Gates Foundation has launched its fourth annual Goalkeepers Report, featuring new data showing how the ripple effects of COVID-19 have stopped 20 years of progress toward the United Nations Sustainable Development Goals (Global Goals). Because of COVID-19, extreme poverty has increased by 7%. Vaccine coverage, a good proxy measure for how health systems are functioning, is dropping to levels last seen in the 1990s, setting the world back about 25 years in 25 weeks. Economic damage from COVID-19 is reinforcing inequalities. The pandemic has had a disproportionate impact on women, racial and ethnic minority communities, and people living in extreme poverty.
Environment: More can be done to ensure a green recovery from COVID-19 crisis (OECD)
Many governments have included “green” recovery measures in their crisis recovery packages (preliminary OECD estimates suggest these amount to about USD 312 billion) – for example through grants, loans and tax reliefs directed towards green transport, circular economy and clean energy research, development and deployment. They also include new funding and programmes to create jobs and stimulate economic activity through ecosystem restoration, control of invasive alien species and forest conservation. But so far the balance between green and non-green spending is not favourable in terms of the support towards positive environmental outcomes.
Trade as a Tool for an Efficient Recovery (IMF Blog)
As economies now look for paths to recovery from the COVID-19 crisis, new evidence reaffirms that policies for more open and trade-integrated economies could significantly benefit domestic competition and ultimately may help lower costs for consumers in emerging and developing economies. A recent Working Paper, building on the Regional Economic Outlook chapter on competition, competitiveness and growth in Sub-Saharan Africa, examines the effect of trade liberalization using a large firm-level dataset covering about 400,000 firms in 83 emerging and developing economies from 2000 to 2017. The findings support efforts currently underway to increase trade integration among emerging and developing economies. The African Continental Free Trade Area, which was the subject of another Regional Economic Outlook chapter, as well as a recent IMF Staff Discussion Note, will go into operation in January and is a historic opportunity to deepen trade and economic integration.
Oil demand set for slow recovery from virus: IEA (Eyewitness News)
With novel coronavirus cases surging in many parts of the world and more people working from home, the recovery in global oil demand is likely to be slow in the coming months, the IEA said on Tuesday as it lowered its forecasts. Oil demand quickly recovered part of the lost ground from April when much of the world was in lockdown to slow the spread of the virus that causes the COVID-19 illness. But the International Energy Agency said in its latest monthly report it expected the recovery in demand “to decelerate markedly in the second half of 2020, with most of the easy gains already achieved”.
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National news
Namibia records N$3.5 billion deficit for July (New Era)
In July 2020, Namibia recorded a trade deficit of N$3.5 billion, after the country’s exports stood at N$5.9 billion and imports at N$9.4 billion. According to the Namibia Statistics Agency (NSA) in its monthly trade statistics report released last week, July 2020 figures show that exports weakened, falling by more than 20% from its revised level of N$7.5 billion in June 2020 and N$7.6 billion recorded in July 2019. Total imports increased by 31% from its level of N$7.2 billion in the preceding month and declined by 3.8% when compared to its level of N$9.8 billion recorded in July 2019.
Tito Mboweni: Reform is critical to survive (Citypress)
South Africa faces tough choices in the coming months and we will all have to make painful sacrifices, writes finance minister Tito Mboweni.
“The large contraction in growth raises three questions. First, what can we learn by unpacking the GDP numbers? Second, what does this mean for South Africa’s finances? And third, what does government plan to do to turn the situation around? We know what we need to do to improve our growth potential and competitiveness. Priority areas include ensuring an adequate and reliable electricity supply, driving employment-oriented industrialisation, reviving the tourism industry, implementing mass public employment programmes and pursuing aggressive infrastructure investment to rejuvenate our construction sector, especially in network industries such as ports, rail and roads.”
Cabinet approves climate change plans (SAnews)
Cabinet has recently approved three key actions that will contribute to an environment that is not only healthy for all South Africans, but one that is conducive to sustainable economic development and job creation. During its meeting last Wednesday, Cabinet approved the Presidential Climate Change Coordinating Commission (PCCCC) to coordinate and oversee the Just Transition. Also approved was South Africa’s Low Emissions Development Strategy (LEDS) and the revised National Waste Management Strategy 2020.
South African Airways Saga Continues As It Needs Funding Again (Simple Flying)
South African Airways has said that it needs additional funding by the end of the next week. The financial support will be used to continue its business rescue. The South African government has shown support for the plan. However, it has not said where it will get the money from. South African Airways Business Rescue Practitioners set out a plan of action in June. The focus was on restructuring, which required R10bn ($598m) and the termination of aircraft leases.
Kenya Airways State takeover frozen in legal hitch (Business Daily)
The nationalisation of Kenya Airways #ticker:KQ (KQ) has suffered a setback after Parliament stalled a proposed law that seeks to return the national carrier to government ownership due to lack of public participation. The legal hitch looks set to further delay the plan to nationalise the loss-making Kenya Airways as regional competitors seeking to carve out market share pour cash into their national carriers. Members of Parliament stopped debate on the National Aviation Management Bill, 2020 because it lacks the input of Kenyans and other stakeholders in line with the Constitution.
Kenya imposes 25% customs on Egypt exports, violating COMESA agreement (MENAFN.COM)
Kenya has decided to impose a 25% customs on Egyptian exports, in violation of the COMESA agreement. The issue was raised with the 10th of Ramadan Investors Association, which has received complaints from factories in Egypt that their goods are accumulating in some African ports, including in Kenya. The Kenyan move contradicts the principles of the agreement. Accordingly, the association, headed by Samir Aref, called on the Egyptian government, to accelerate the reactivation of the COMESA agreement. This would then open the way for Egyptian products moving to the 21 countries under COMESA, the largest economic grouping on the continent.
Big boost for SMEs as KEBS steps in to ease operating challenges (The Star)
Small and medium enterprises are set to enjoy a raft of preferential benefits from the Kenya Bureau of Standards (KEBS) following the passing of a policy geared at supporting their growth. Statistical data estimates that Kenya’s MSMEs contribute approximately 40 per cent of the GDP with the majority falling in the informal sector. Conscious of the challenges facing upcoming entrepreneurs including access to affordable financing options, the application of graduated fees, KEBS Board Chairman Eng Bernard Ngore said.
Rwanda: Tourism on a progressive trajectory since reopening (The New Times)
Rwanda eased tourism restrictions on June 17, allowing local and international tourists to visit the country after months of suspension due to Covid-19 and travel bans imposed by countries. Data from Rwanda Development Board (RDB) show an optimistic picture of slow recovery since the country reopened tourism activities.
Nigerian keen on increased trade ties with East Africa (The Citizen)
Nigeria, sub-Saharan Africa’s largest economy, is keen on increased trade links with the East African Community (EAC). Outgoing Nigerian High Commissioner to Tanzania Sahabi Issa Gada, said his country was ready for deeper relations with the EA bloc. “There is a need to encourage deeper integration through business exchanges,” he said when he paid a visit to the EAC headquarters here. He stressed the need for Ecowas and EAC to work together in order to achieve the set goals as the building blocks for the continental integration. Dr Gada, who was also accredited to the EAC, said increased trade between the two sides would boost the economies of the same.
Leaked letter by Poultry Farmers Association triggered CBN emergency approval to import maize (Nairametrics)
A letter from the Poultry Farmers Association of Nigeria is touted as the trigger for the recent decision by the Central Bank of Nigeria to approve emergency importation of 262,000 tons of maize into Nigeria. In the letter, the association called on President Buhari to allow for guided importation of maize, in order not to shut down the poultry industry in Nigeria, since poultry farmers rely heavily on maize to feed their chickens. The Central Bank, in July, adding to its 41 items ban list, announced a ban on forex for maize importation into the country, so local farmers could compete.
Fiscal headwinds could scuttle economic recovery – CBN report (The Guardian Nigeria)
The Central Bank of Nigeria (CBN) has admitted that the expanded Federal Government’s budget deficit, escalating level of unemployment, rising inflation arising from increase in Value Added Tax (VAT) and border closure threaten various efforts to reduce the effects of the Coronavirus Disease 2019 (COVID-19) pandemic on the masses. “Headline inflation is expected to hover around 13.97 and 14.15 percent at end-December 2020, owing to supply shocks, which may likely happen due to declining economic activities globally as a result of COVID-19 pandemic that started in China in Q4, 2019; demand shocks emanating from domestic and international lockdowns; food supply shocks associated with non-tariff border protection and effect of the implementation of the new budget and minimum wage,” it noted in the 143-page document.
Ghana won’t use U.S definition of ‘salvage’ to ban second-hand cars – Trade Minister (GhanaWeb)
Trade Minister Alan Kyerematen has revealed that the government of Ghana will not adopt the United States’ definition of what constitutes salvaged cars in banning the import of second-hand cars into Ghana. He said there are some cars that have been described as salvaged by insurance companies in the US and other parts of the world that could still be fit-for-purpose and can be used in Ghana.
Regional and continental news
COMESA launches Regional Customs Transit Guarantee Scheme mobile app
The COMESA Regional Customs Transit Guarantee Scheme (RCTG Carnet) has launched a Mobile Application designed to provide access to real-time information to Clearing and Forwarding Agents. The Application which is accessible on Google Play Store and Apple Store is a one-stop shop that will allow Clearing and Forwarding Agents in member countries to view current bond balance and active Carnets, get notifications on Carnet acquittals and expiry of RCTG Bonds.
SACU treads with care on AfCFTA (The Southern Times)
The Southern African Customs Union (SACU) has cautioned members to tread with care when implementing the African Continental Free Trade Area (AfCFTA). Chairperson of the SACU Ministers of Trade and Industry, South Africa’s Ebrahim Patel told his colleagues that, “The AfCFTA raises a number of questions that go to the heart of policy and strategy. The first question is what we want to achieve from the Continental Free Trade Area.”
Petty sibling rivalry slowing trade in EAC – Kituyi (The Star)
East Africa Community (EAC) members need to rise above petty sibling rivalry and ride on superb mutual trade deals to spur economic growth in the region.In an interview with the Star, the United Nations Conference on Trade and Development (UNCTAD) undersecretary Mukhisa Kituyi hailed the region’s Common Market Protocol as the best open market policy model in the world. ‘‘The region has a great market of more than 200 million people. They simply have to focus on putting to use excellent trade policies in place to promote trade and attract foreign direct investments,’’ Kituyi said.
AGRF 2020 Concludes With Call For Greater Focus On Urban Food Markets (East African Business Week)
The 10th edition of the annual African Green Revolution Forum (AGRF) in Kigali Rwanda, saw heads of state, government ministers, civil society, and business leaders resolve to use the flourishing urban food markets as a launchpad for growing the continent’s agricultural investments into stable businesses. Speaking in his closing Presidential Address, H.E. Paul Kagame, President of the Republic of Rwanda, commented: “Increasingly, African consumers live in cities. Our continent has the world’s fastest rates of urbanization and will continue to do so, for decades to come.... The quality of that urbanization depends, in large part, on ensuring solid linkages between urban food markets and Africa’s rural producers.”
Museveni, Magufuli agree to fast-track crude oil pipeline project (The Kampala Post)
President Museveni and his Tanzanian counterpart John Pombe Magufuli agreed to fast-track the harmonization of issues that are delaying key projects in extracting Uganda’s crude oil. “In principle, we agreed that our governments expedite the harmonization of pending issues in the spirit of the East African Community (EAC), the remaining agreements be fast-tracked including the Tanzanian HGA and we quickly carry out the implementation of EACOP project,” President Museveni said in a tweet posted late Sunday. The project, upon completion, will enable Tanzania to earn about $3.2 billion and create between 10,000 to 15,000 jobs over the next 25 years.
Group tasks new ECOWAS Chairperson on Trans-West African railway (Vanguard)
The African Railway Roundtable, a rail advocacy society, has tasked President Nana Akuffo Ado of Ghana to use his chairmanship of the Economic Commission of West African States (ECOWAS) to revive the moribund Trans-West African Railway project. In a statement issued over the weekend and signed by its Director, Olawale Rasheed, the group lamented that ECOWAS has remained silent for so long on the regional rail project which is to connect West African States from Nigeria to Mauritania.
Osinbajo says Africa should use AfCFTA as template for trade negotiations with rest of the world (Pulse Nigeria)
Vice President Yemi Osinbajo has encouraged African countries to take advantage of the implementation of the Africa Continental Free Trade Area (AfCFTA) agreement to ensure trade negotiations with the rest of the based on the free trade agreement rather than deals separately endorsed by regional economic blocs. “The reality is that if care is not taken, trade liberalization can expose the Nigerian economy to unfair competition and sharp trade practices, with adverse consequences for our producers who might have to close down their businesses, and for our workers who would then lose their jobs.”
Senegalese President Macky Sall is right about African Debt Relief – and the G20 shouldn’t stop there (African Energy Chamber)
The Senegalese leader urged members of the G20 group of countries to continue helping African nations balance their obligations to creditors with their obligations to their own citizens in the face of a deadly pandemic. Debt relief is necessary to flatten the curve. It’s what will give Africa time and space to start carving out a path towards recovery – to take the steps necessary to bring new investment to the oil and gas industry, to build Africa’s sustainable energy sector, to expand business and residential consumers’ access to electric power, to revive small businesses, to promote innovation and entrepreneurship, to foster job creation, and to remove red tape and regulatory obstacles.
Strong land governance can help rebuild Africa, fighting the effects of COVID-19
People-centred land governance is necessary to relaunch Africa’s agriculture. We cannot stand and wait until the sector is crushed. From 15-17 September 2020, the International Land Coalition in Africa (ILC Africa), African Union Commission (AUC) and Intergovernmental Authority on Development (IGAD) are convening various stakeholders on land governance to the Africa Land Forum 2020. Over 1000 development actors will grapple with one theme: Delivering on the African Union’s Agenda 2063 for people-centred land governance in Africa.
AfCFTA negotiators adapt to new virtual reality, highlighting trade in technology services (TechEconomy.ng)
The AU, which is leading discussions around first AfCFTA deal, noted that negotiations would take place via a new African Virtual Trade-Diplomacy Platform, allowing parties from across many different timelines to meet in a secure online environment. The physical constraints of doing deals during global lockdowns has made negotiation and due diligence more difficult for all dealmakers, but virtual teleconferencing services have done much to address the logistical challenges and have provided the ability for parties to continue negotiations.
Global news
Coronavirus shows the inequality among nations (New Frame)
At the end of July, and far away from the front lines where health workers were battling to extinguish the deadly fires ignited by the coronavirus, the World Trade Organization (WTO) convened a meeting of the forum that deals with the world body’s agreement on trade-related aspects of intellectual property rights (TRIPS). On the agenda of the TRIPS council was a plea from developing and least-developed members of the WTO for medicines, vaccines and other medical appliances to be accessible to all during the Covid-19 pandemic. “Given this present context of global emergency, it is important for WTO members to work together to ensure that intellectual property rights such as patents, industrial designs, copyright and protection of undisclosed information do not create barriers to the timely access to affordable medical products including vaccines and medicines,” South Africa’s submission implored.
The ACT-Accelerator is the proven, up-and-running, global collaboration accelerating the development, production, and equitable access to COVID-19 tests, treatments, and vaccines. UN Secretary-General António Guterres, said: “We now need US$35 billion more to go from set-up to scale and impact. There is a real urgency in these numbers. Without an infusion of US$15 billion over the next 3 months, beginning immediately, we will lose the window of opportunity”.
President Paul Kagame of Rwanda noted: “This is certainly one of the most important initiatives underway in the world today and perhaps ever”. He added “The difference between success and failure lies in building a robust public health infrastructure that can confront any health issue in a sustainable manner. Solid health systems combined with transformational partnerships such as this Accelerator are critical.”
China not pursing debt-trap diplomacy in Africa, middle income countries – Diplomats (Vanguard News)
A group of Chinese diplomats have denied United States government’s claims that China is advancing a debt-trap diplomacy to enslave poor and middle-income countries. “The Belt and Road Initiative (BRI) is frequently portrayed as a geopolitical strategy that ensnares countries in unsustainable debt and allows China undue influence,” the diplomats said in a new publication presented at the Chatham House, London, with the title: ‘Debunking the Myth of Debt-Trap Diplomacy: How Recipient Countries Shape China’s Belt and Road Initiative’. “Economic factors are the primary driver of current BRI projects; China’s development financing system is too fragmented and poorly coordinated to pursue detailed strategic objectives; and developing-country governments and their associated political and economic interests determine the nature of BRI projects on their territory.”
FAO to continue to support G20 to address the pandemic and strengthen agri-food systems
In his address to the meeting, QU highlighted that measures and joint efforts, taken so far by countries and international organizations, have allowed global food value chains to continue to function well amid the pandemic. “Global food markets are well supplied. However, as the global economy struggles to recover, access to food will be negatively affected by income reductions and loss of jobs. We must ensure that trade continues to flow smoothly to contribute to food security and nutrition globally,” he said, noting that the 2020 edition of FAO’s flagship report
Emerging technology clusters driving evolution in financial services, says World Economic Forum
Emerging technologies such as artificial intelligence (AI), 5G, distributed ledger technologies and quantum are increasingly being used by financial services firms and forming clusters that are driving innovation throughout the sector. These advances can offer new services and savings to both consumers and financial institutions. Forging New Pathways: The next evolution of innovation in financial services offers a framework for understanding how AI is combining with other emerging technologies and shaping the financial services industry. “It is not sufficient to look at individual technology implementations,” said Drew Propson, Head of Technology and Innovation in Financial Services, World Economic Forum. “Financial services firms must consider the benefits derived from the coordinated deployment of emerging technologies to unlock the full potential of these technologies.”
Nations of the South display spirit of ‘global solidarity’ – UN chief (UN News)
At a Virtual High-level Commemoration and Panel Discussion on the theme “Pathways toward the Sustainable Development Goals through South-South solidarity beyond COVID-19”, Secretary-General António Guterres said in his message that developing countries are “delivering medical supplies, providing financial resources… and sharing best practices on how to fight the pandemic”. “To safeguard the future, we must work in a sustainable manner: addressing structural problems in global and national economies and investing in human capital” he advocated, urging Member States to continue to support the UN Office for South-South Cooperation (UNOSSC) and its initiatives.
More than 50 per cent of global destinations are easing travel restrictions: UNWTO (BW Hotelier)
A majority of destinations around the world (53 per cent) have now started easing travel restrictions introduced in response to the COVID-19 pandemic, according to UNWTO. Though many remain cautious in view of the development of the pandemic. UNWTO Secretary-General Zurab Pololikashvili said, “Coordinated leadership and enhanced cooperation between governments means tourism is slowly but steadily restarting in many parts of the world. Starting to ease restrictions on travel opens also the doors for tourism’s social and economic benefits to return. While we must remain vigilant and cautious, we are concerned about those destinations with ongoing full travel restrictions, especially where tourism is a lifeline and economic and social development are under threat.”
Related News
COMESA launches Regional Customs Transit Guarantee Scheme mobile app
The COMESA Regional Customs Transit Guarantee Scheme (RCTG Carnet) has launched a Mobile Application designed to provide access to real-time information to Clearing and Forwarding Agents.
The Application which is accessible on Google Play Store and Apple Store is a one-stop shop that will allow Clearing and Forwarding Agents in member countries to view current bond balance and active Carnets, get notifications on Carnet acquittals and expiry of RCTG Bonds.
Carnet is a Guarantee document that is used throughout the transit process as a proof of a valid Guarantee/Bond and an undertaking to comply with Customs obligations within each transit country.
The RCTG Scheme is a customs transit regime developed to facilitate the movement of goods under customs seals in the COMESA region. It provides the required customs security and guarantee to the transit countries. Among its key benefit is the reducing the cost of Bond /Guarantee and collaterals charged by Sureties and agents.
“I certainly believe that the creation of this Mobile Application is a very practical way of enabling Clearing and Forwarding Agents to access real-time information on their RCTG bonds from wherever they are without going through Customs Authority offices”, Secretary General Chileshe Kapwepwe said.
COMESA RCTG Carnet is the second of its kind in the world after the European Transports Internationaux Routiers (TIR) Carnet and the only one in the region and continent. It is recognized by the World Customs Organization (WCO).
The RCTG Scheme has 13 members namely: Burundi, Djibouti, DR Congo, Ethiopia, Madagascar, Malawi, Kenya, Rwanda, South Sudan, Sudan, Tanzania, Uganda and Zimbabwe. Currently, the Scheme is operational in five countries; namely: Burundi, Kenya, Rwanda, Tanzania and Uganda. The RCTG Carnet is fully digitalized and integrated with the National Customs IT Systems.
During the year 2018 nearly $2 billion COMESA RCTG Carnet (guarantee) for customs duty and taxes for goods in transit in the Northern and Central Corridor countries were issued. Find the App on google and apple store on:
https://play.google.com/store/apps/details?id=com.comesa.rctgmobile
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A Strengthened Partnership for Post-COVID-19 Economic Recovery (US Embassy in South Africa)
The Department of International Relations and Cooperation hosted the 11th Annual Bilateral Forum (ABF) on 9 and 10 September 2020 under the theme “A Strengthened SA-US partnership for post-COVID-19 Economic Recovery.” The purpose of the ABF is to review progress in sectoral cooperation, identify challenges, and make recommendations for future cooperation that advances the interests of both countries. The meeting resolved that both countries would work to address challenges and identify opportunities in the bilateral trade and investment relationship, with a view to increasing the levels of trade and investment to assist in economic recovery.
Closing tax leakage from illicit alcohol trade critical for post-lockdown economic recovery (Rising Sun Chatsworth)
The alcohol industry notes the recent media reports attributed to the SARS commissioner, Edward Kieswetter, confirming that the illicit trade of alcohol is thriving and that it could take years to dismantle the criminal networks that entrenched themselves as a result of the ban on the sale of alcohol during the COVID-19 lockdown. The report stated that the retail ban on alcohol sales and closure of tourist accommodation facilities were notable drags on trade activity, with consumer spending on alcohol and cigarettes falling by 92, 4 percent.
South Africa’s trade surplus halves in the second quarter, Reserve Bank says (News24)
The South African Reserve Bank on Thursday announced that the current account of balance payments switched from a surplus of R63.4 billion in the first quarter of 2020 to a deficit of R103.6 billion in the second quarter of 2020. According to the Reserve Bank, this was the only surplus since the first quarter of 2003. The Reserve Bank pointed to merchandise exports decreasing more than imports for the deterioration of trade balance. “Consequently, the current account balance as a ratio of gross domestic product (GDP) reverted to a deficit of 2.4% in the second quarter of 2020 from a surplus of 1.2% in the first quarter,” the Reserve Bank said. South Africa’s trade surplus more than halved from R201.7 billion in the first quarter of 2020 to R91.5 billion in the second quarter.
Transformation of African economies – The case of Botswana as a gateway to doing business in Africa (EURACTIV)
In recent EU negotiations, a clear shift in narrative from “development” to “fostering partnerships” is apparent – as seen during the 10th African Union – European Commission meeting in Ethiopia early this year. Botswana’s sound macroeconomic policies, its legal and regulatory frameworks, and strong economic and political institutions make the country a safe and desirable investment destination. With growing infrastructure development and geographically in a central location, Botswana is seen by some as the gateway to doing business in the region, and a credible entry point to access the entire continent.
New Namibian terminal 100% operational (Port Strategy)
A new container terminal at a Namibian port is now fully operational, according to a report by the African Development Bank (ADB). It noted “the expansion has steered Walvis Bay towards becoming a logistics hub for southern Africa that aims to meet the growing demand for freight ,while promoting new maritime access to serve the landlocked countries of the Southern Africa Development Community (SADC)”. The ADB provided a ZAR2,982m loan representing over 70% of the project funding.
Firms, KRA fail to strike tax rise deal on 31 goods (Business Daily)
A meeting between the Kenya Revenue Authority (KRA) and manufacturers over planned increases in taxes on more than 30 goods including fuel, bottled water, juice and beer from October failed to reach an agreement on Thursday. KRA said it needs time and legal advice on a petition by the Kenya Association of Manufacturers (KAM), which seeks to freeze the automatic tax adjustment from October 1. The manufacturing sector lobby last week urged the taxman to pause implementation of the annual inflation adjustment tax that affects excisable goods, citing economic hardships as a result of Covid-19 crisis.
New KRA app to allow tax payment through M-Pesa (Business Daily)
Workers and businesses can file their returns and pay taxes through their mobile phones after the Kenya Revenue Authority (KRA) launched an app for accessing its services in the race to ease duty payments and boost collection.The Kenya Revenue Authority (KRA) said the app, dubbed KRA M-Service, that will mainly use M-Pesa is aimed at making tax transactions easier and cut the cost of compliance through removal of intermediaries.
Besides cost, what is good in digital tax? (Daily Monitor)
Whereas manufacturers, and genuinely so, are concerned on the cost that comes with digital tax stamps, government insists, the conversation should be beyond cost. The focus, government argues, should be on the advantages therein, key among them curbing the increasing rate of counterfeits, balancing the tax equation and widening the tax base. For close or more than a year now, the exchange between government, particularly Uganda Revenue Authority (URA) and manufacturers has been too loud.
Farmers’ lobby wins first round in sugar rules case (Business Daily)
The High Court has temporarily stopped implementation of new regulations aimed at reviving the ailing sugar sector. In his ruling, Justice Roselyne Aburiri ordered that implementation of the Crops (Sugar) General) Regulations, 2020 be stopped pending the hearing and determination of a case filed by a farmers’ lobby group. “Undoing an implemented regulation will be an uphill task and will render the pending petition nugatory and the petitioner will be rendered a mere pious explorer in the pursuit of justice,” said judge Aburiri.
Oil spill threatens Mauritian blue economy, will take “decades to recover” (Southern African News Features)
An oil spill off the coast of Mauritius in July is threating the island nation’s efforts to attain a blue economy. “We are talking of decades to recover from this damage, and some of it may never recover,” notes Mauritian oceanographer, Vassen Kauppaymuthoo. Mauritius relies heavily on tourism, a sector already heavily impacted by the ongoing Covid-19 pandemic. The sector is the third pillar of the economy after manufacturing and agriculture. It is estimated that more than 100,000 domestic and international tourists annually visit the Blue Bay, where the spill occurred.
Sudan declares state of economic emergency after sharp fall in currency (The East African)
Sudan declared an economic state of emergency on Thursday after its currency fell sharply in recent weeks, setting up special courts to prosecute what officials called a “systematic operation” to vandalise the economy. The transitional government, in charge of the country since the ouster of Omar al-Bashir last year, will criminalise purchasing, selling, possessing or smuggling raw gold or precious minerals, key hard-currency earners. “We are able to simply say what happened is an open war against the revolution, the economy, the government,” Information Minister Faisal Saleh told a news conference.
Buhari insists “no kobo” of foreign exchange will be issued for food imports (Nairametrics)
President Buhari has warned the Central Bank of Nigeria against implementing any plans geared towards providing forex for the importation of “food items and fertilizers” into the country. The President made this remark via his twitter handle on Thursday, September 10th as he presides over the National Food Security Council meeting yesterday at the State House, Abuja.
Regional and continental news
Following a meeting convened by the Pan-African Private Sector Trade and Investment Committee (PAFTRAC) and hosted by the Afreximbank, a communiqué addressed to members of the WTO and the eight candidates who have been shortlisted as the institution’s next Director General was released yesterday calling for a wide range of reforms. The communiqué was formulated following numerous consultations with PAFTRAC members, its institutional partners, and through a comprehensive survey of the African private sector. Within it, the Committee have highlighted a number of recommendations to ensure the institution is more effective in growing global trade but doing so in a manner that is fair to all.
A survey of 200 CEOs was commissioned by PAFTRAC, and conducted by African Business magazine in partnership with the Afreximbank. It revealed that: African CEOs explicitly called for a fairer system governing global trade that will support developing countries; 37% of the CEOs surveyed feel WTO as it stands is ineffective; 65% of the CEOs feel the global trading system is unfair to Africa; The CEOs were also optimistic about the future outlook: Over 50% of CEOs believe global trade will increase over the next 12 months; and over 70% of CEOs believe intra-Africa trade will increase over the next 12 months
AU plans common currency, market for African countries (Guardian)
The African Union-Economic, Social and Cultural Council (AU-ECOSOCC, Nigeria), on Thursday, said it is considering common currency and market for over 50 countries in the continent as part of its development plans under ‘Agenda 2063′ Nigeria’s Representative for AU-ECOSOCC, Dr Tunji John, disclosed this in Abuja. “The African Union ‘Agenda 2063′ is a brain work for development. The slogan for that agenda is when you say African Union, you will say “Africa we want”. What type of Africa are we envisaging in the next 50 years? We are saying that we need an Africa with a common currency, common market.”
How Africa can manufacture to meet its own pharmaceutical needs (Africa Renewal)
The PMPA business plan underscores the urgency in addressing the challenges facing the industry. One such challenge is a lack of affordable financing and modern technology, which hampers business expansion. Other challenges are Africa’s small fragmented markets and weak regulatory frameworks. The good news is that some opportunities are available to be explored. For example, the African Continental Free Trade Area (AfCFTA), if successfully implemented, will address the challenge of small fragmented markets that have for a long time disincentivized pharmaceutical manufacturing investors.
How bitcoin gained currency in Africa (The Japan Times)
Four months ago, Abolaji Odunjo made a fundamental change to his business selling mobile phones in a bustling street market in Lagos: He started paying his suppliers in bitcoin. Odunjo sources handsets and accessories from China and the United Arab Emirates. His Chinese suppliers asked to be paid in the cryptocurrency, he said, for speed and convenience.
COVID-19: New ECA report calls on governments to harmonize trade & cross-border policies (UNECA)
The Economic Commission for Africa (ECA) on Thursday launched a new COVID-19 cross-border trade report urging governments on the continent to adopt and harmonize policies that will help continent strike an appropriate balance between curbing the spread of the virus and facilitating emergency and essential trade. Titled pdf Facilitating cross-border trade through a coordinated African response to COVID-19 (2.16 MB) , the report says continued inefficiencies and disruptions to cross-border trade presented significant challenges for Africa’s fight against COVID-19, and risked holding back the continent’s progress towards the attainment of the sustainable development and goals and Africa’s Agenda 2063. Maintaining trade flows as much as possible during the pandemic will be crucial in providing access to essential food and much-needed medical items and in limiting negative impacts on jobs and poverty, said Mr. Stephen Karingi, Director of the ECA’s Regional Integration and Trade Division (RITD) that penned the report.
Supporting Public Private Partnerships in Africa: African Development Bank ready to scale up (AfDB)
Representatives of the African Development Bank, governments, Development Finance Institutions, the private sector and professional associations joined a September 8 workshop to discuss how the Bank can strengthen support for Public Private Partnerships and channel greater investment toward economic and social infrastructure. “Before the COVID-19 pandemic, African infrastructure was already struggling to structure projects tailored for the private sector and at the same time achieving value for money for the public sector including affordability for users. It is therefore imperative that hybrid solutions such as PPPs must be seen and promoted as a way of building back better, stronger, greener, by clawing back private capital to infrastructure while creating much needed fiscal room for governments to address multiple other demands including building health systems’ resiliency,” Bank Vice President Solomon Quaynor said in his opening remarks.
The Africa Nexus: Intra-Trade and Investment as drivers of African Development (Brand South Africa)
Brand South Africa today hosted an Africa nexus research reference group webinar with key objectives to determine insights and perspectives on how the African Continental Free Trade (AcFTA) could enable economic recovery and development in the context of the impact of the COVID-19 pandemic. The purpose of the research reference group was to bring South African companies together that have experience of doing business in peer African markets. Over the years Brand South Africa has conducted extensive research in peer markets to determine the reputation, and profile of South Africa as an investor and trade partner. Through this research it has emerged that market entry strategies adopted by South African companies when they enter peer markets is a critical focus area if the country is to deepen its business relations across the continent.
Why Africa’s Hospitality Sector Is Key To The Continent’s Economic Recovery Post Covid-19 (Africa.com)
Lack of available financing was already one of the most important challenges for the hospitality industry in Africa prior to the Covid-19 crisis. While Africa still accounts for relatively few Covid-19 deaths compared to the rest of the world, the economic impacts of the pandemic on the continent continue to grow.
Global news
Mukhisa says planned Kenya-US trade deal unfavourable (The Star)
The Kenya-US trade deal is lopsided and will only benefit the latter, the United Nations Conference on Trade and Development (UNCTAD) undersecretary Mukhisa Kituyi has said.In an exclusive interview with the Star, the UNCTAD head, said the US market is already open for Kenyan products under the Africa Growth Opportunity Act (AGOA) that expires in 2025.Kituyi wondered what market Kenya is set to create in the US under the planed Free Trade Agreement, considering it is yet to exhaust existing market openings under AGOA.
Trump admin bets millions on rural African e-commerce startups (Quartz Africa)
The United States’ International Development Finance Corporation (DFC) has backed two fledgling e-commerce startups operating in East Africa as part of its latest quarterly $3.6 billion investment spend. The DFC confirmed a $5 million equity investment in Copia Global, a Kenya-based e-commerce and logistics startup that focuses on under-served consumers in rural areas. The timing of DFC’s investments is consistent with the uptick in the adoption of digital services, including e-commerce, as a result of the Covid-19 pandemic and the lockdown measures instituted to restrict the virus’ spread. Inadvertently, those restrictions have been a boost for e-commerce on the continent with more Africans shopping online out of necessity and safety.
Kenya’s Amina Mohamed promises to deliver if elected director-general of WTO (African Business Magazine)
While some commentators are worried about whether the World Trade Organization (WTO) will survive a move towards protectionism in more developed markets, Kenya’s former minister of foreign affairs and international trade remains upbeat about the uses and benefits of multilateralism. Mohamed said: “I definitely think that an African director-general would be a good arbiter of any tensions within the multilateral system.” The fact that African countries have created the largest multilateral trade area in the form of the African Continental Free Trade Area (AfCFTA) since the creation of the WTO in 1995 – while other blocs are showing signs of disintegration – is presented as evidence that the mantle for multilateralism may have passed to the continent.
Members to debate how Aid for Trade can address COVID-19 impact on developing countries (WTO)
WTO members have highlighted the negative impact of the COVID-19 pandemic on the participation of developing countries in world trade. At a meeting of the Committee on Trade and Development on 7 July dedicated to Aid for Trade, members noted that developing countries’ exports of goods and services have been badly affected by a global decline in demand and disruptions in production chains. WTO Deputy Director-General Yonov Frederick Agah, who oversees development matters in the WTO Secretariat, said: “The economic fallout from the COVID-19 pandemic risks reversing progress made in their trade integration and economic development. We are following very closely the impact of the pandemic and the measures that members are taking in response to it.”
UNWTO: More Than 50% of Global Destinations Ease Travel Restrictions – With Caution (Hotel Business)
A majority of destinations around the world (53%) have now started easing travel restrictions introduced in response to the COVID-19 pandemic. Though many remain cautious in view of the development of the pandemic, the seventh edition of the UNWTO “COVID-19 Related Travel Restrictions: A Global Review for Tourism” confirms the ongoing trend toward the gradual restart of tourism. “Starting to ease restrictions on travel opens the doors for tourism’s social and economic benefits to return. While we must remain vigilant and cautious, we are concerned about those destinations with ongoing full travel restrictions, especially where tourism is a lifeline and economic and social development are under threat.”
Navigating through the coronavirus crisis and uncertainty: How maritime transport data can help (UNCTAD)
Container shipping is closely correlated with developments in the world economy, manufacturing, and consumption. Consequently, containership port call patterns could generate useful insights into the underlying macroeconomic trends. As highlighted by data on port calls and shipping schedules, there seems to be a pickup in shipping activity since the third quarter of 2020. Preliminary results from UNCTAD's nowcast that tracks global merchandise trade shows a similar development, estimating steep declines during the second quarter and forecasting a partial recovery in the third quarter.
IEA says green hydrogen is ‘ready for big time’ and lists Africa as key production site (Engineering News)
Africa has been listed, in a new International Energy Agency (IEA) report, as one of the locations that could emerge as dominant in the production of green hydrogen, which the agency says is required to extend the decarbonisation reach of renewable electricity to industries where the direct use of power is difficult, such as steel manufacturing and aviation. Published on September 10, the IEA’s ‘Energy Technology Perspectives 2020’ report says the global capacity of electrolysers, which produce hydrogen from water and electricity, will need to rise sharply as part of a broader, multi-technology effort to align the global energy system with international climate goals.
Hopes and Challenges for the First Ever Food Systems Summit (Inter Press Service)
Building inclusive and healthier food systems, and safeguarding the health of the planet will be some of the key priorities at the first-ever Food Systems Summit next year. “Food is more than what satisfies our hunger, it’s more than what nourishes our bodies and brains,” Kalibata, former Minister of Agriculture and Animal Resources in Rwanda, said in a passionate speech in February. “Food is…economics, politics.” Kalibata has ambitious plans for the Food Systems Summit. She said there’s a U.N. Task Force dedicated to the summit that will be guiding existing research “so that nothing falls through the cracks”, and it will be collaborating with experts examining scientific data from around the world.
EU Logistics In The BRI Maps: Synergy of BRI and TEN-T (Modern Diplomacy)
Deepening integration processes within the Union and building up mutual economic and social ties have revealed bottlenecks in European logistics in the form of disparate national projects for its development, lagging in the introduction of intermodal transport technologies, and insufficient coordination of the development of individual modes of transport and improving their environmental friendliness. In order to eliminate these bottlenecks, the EU adopted the Trans – European transport network development program (TEN-T), designed up to 2050.
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City of Cape Town eyes air cargo as new revenue stream (IOL)
The tourism industry requires innovative ways to ensure revenue is being generated by the sector, so air cargo will be taken advantage of while passenger transport remains low.The City of Cape Town recently launched a Tourism Bounce Back Strategy aimed at Cape Town’s tourism and related sectors. Wesgro hosted a webinar with the City to discuss ways to increase demand for Cape products. Air cargo was found to be the avenue to best pursue during the pandemic. Mayco member for economic opportunities and asset management, James Vos, said: “According to information, there is an opportunity for Cape Town to leverage the fact that airlines are looking to air cargo to help generate revenue while passenger numbers remain low. We are also working to help stimulate supply and demand for Cape Town products.”
Platinum has good lockdown with supply deficit set to widen in 2020, says WPIC (Miningmx)
Platinum has had a good lockdown, according to the World Platinum Investment Council (WPIC) which said on Tuesday demand for the metal outstripped supply in the second quarter. “An evolving global sea-change in the environment debate may also be at play in changing investor sentiment towards platinum, significantly bolstering platinum’s green and precious metal credentials,” the council said. “With the economic impact of Covid-19 depleting climate change funding, there has been growing impetus from China, Japan, South Korea the European Union and the US to prioritise the ‘hydrogen economy’ in cost-effectively driving forward the green agenda.”
AG guidelines ensure politicians have no excuse to prevent mismanagement (BusinessLIVE)
Government officials and politicians will no longer have the ability to feign ignorance about the measures that should have been taken to prevent financial mismanagement and corruption, after auditor-general Kimi Makwetu released specific guidelines on this on Wednesday.
Technical task team to facilitate SA-US market access (SAnews)
Agriculture, Land Reform and Rural Development Minister Thoko Didiza and United States Ambassador to South Africa, Lana Marks, have agreed to establish a technical task team that will work on facilitating market access of agricultural products. Minister Didiza and Ambassador Marks made the agreement during a virtual meeting held on Tuesday. The meeting discussed agricultural trade relations of mutual interest to both countries. “Increasing agricultural production is important for food security as well as contributing to the economy through trade,” Didiza said.
Kenya “not just a donee” As State Donates Millions To Boost Africa’s Covid-19 War (Nairobi Wire)
The Kenyan government has disbursed a total of Sh300 million to the African Union COVID-19 Response Fund and the Africa Centres for Disease Control and Prevention (Africa CDC). The Ministry of Foreign Affairs on Wednesday said Sh200 million (2 million USD) had already been donated to the African Union. The CAS noted that Kenya is not just a beneficiary of donor funds but is also giving out to others to combat a common enemy. “Since the outbreak of the Novel Corona virus in Kenya in March 2020, the Ministry of Foreign Affairs has been actively engaged in the mobilization of medical supplies and other resources from development partners to the tune of over Ksh. 1 billion. The Ministry will remain seized of this matter of resource mobilization until we find a lasting solution to the challenge of COVID-19,” Ababu said.
SGR reveals Sh21bn loss as China firm debt rises (Business Daily)
Taxpayers face a huge bill sustaining services on the standard gauge railway (SGR) after it posted a combined operating loss of Sh21.68 billion in the three years to May. A report to Parliament by the Transport ministry revealed that the China-built railway netted Sh25.03 billion in revenue over the period against operational costs totalling Sh46.71 billion – a gap that taxpayers have to plug.
Akufo-Addo risks Ghana’s economy by playing games with Nigeria (Vanguard News)
Despite widespread condemnation from Ghana’s own Trade Ministry, Akufo-Addo – in what is likely an attempt to curry political favour with Ghana’s industrialists – has obstructed any attempt to find a civilized solution. Akufo-Addo’s government has also been implicated in the seizure and demolishing of a building in the Nigerian High Commission compound in Accra. Under international law, this unscheduled destruction of a diplomatic compound is in contravention of the Vienna Convention on the Law of Treaties. Aside from international legal questions, the Akufo-Addo government has also been accused of illegal deportation of Nigerian citizens.
Economic Update for Togo: The Coronavirus Is Exerting Pressure on the Economy (World Bank)
The entire Togolese economy is paralyzed, as indicated in the World Bank’s first Economic Update for Togo, published today. The report Boosting Private Investment to Achieve Higher Growth and More Jobs (F), stresses that the COVID-19 pandemic could wipe out four-fifths of Togo’s projected growth in 2020.”We are seeing a decline in production and sales in a host of sectors, particularly in those where telework is not possible, such as manufacturing, retail trade, construction, and tourism. Roughly 62% of jobs are affected – 49% in the service sector and 13% in the industrial sector,” said Urbain Thierry Yogo, Senior Economist at the World Bank in Togo and co-author of the report.
FG: New Devt Plans to Tackle Infrastructure Deficit, Production Cost (THISDAYLIVE)
The Minister of Finance, Budget and National Planning, Mrs. Zainab Ahmed, yesterday identified the goals of the country’s proposed development plans as boosting infrastructure development and supporting the reduction of cost of production of goods and services, among others. She said these were critical for diversifying the economy and revenue base, poverty reduction and job creation. She spoke yesterday in Abuja at the inaugural meeting of the National Steering Committee (NSC) for the preparation of the Medium Term National Development Plan (MTNDP) 2021-2025 and Agenda 2050, which is the co-chair. Ahmed said though the African Continental Free Trade Area (AfCFTA) agreement had opened competition among African countries, as the continent gradually becomes borderless, only countries with actionable development plans would make the greatest impact on the new dispensation.
New tariffs push prices above global average (The Guardian Nigeria)
With tariff hikes in two key sectors, Nigeria is among the Organisation of Petroleum Exporting Countries (OPEC) having the most expensive petroleum products and the sixth-highest energy cost in Africa. The rising cost of energy is a source of worry to development and growth experts. Director-General, Lagos Chamber of Commerce and Industry, Muda Yusuf, told The Guardian that this would worsen the plight of the manufacturing sector, whose contribution to the gross domestic product (GDP) is less than 10 per cent. He noted that the unbearable cost of energy was part of the reason the sector remained uncompetitive.
Study offers tips for Equatorial Guinea’s trade enhancement (Trade for Development News)
One way to understand the country’s challenges, and the opportunities for a more diversified economic base, is via recent analysis of the country’s trade. The study looks at Equatorial Guinea’s supply-side and institutional constraints, and ways to take advantage of opportunities for growth. This type of research, termed a Diagnostic Trade Integration Study (DTIS) and available to all least developed countries (LDCs) and those recently graduated, is requested by a country’s government and developed by the Enhanced Integrated Framework (EIF) together with partners, in this case the World Bank Group. What did Equatorial Guinea’s DTIS find? What recommendations were made to the country to enhance its trade? What is the country doing in response?
Regional and continental news
Covid-19: EAC Countries Called to Reopen Borders (ChimpReports)
Business people operating in the East African region have asked member state governments to open up their borders to enable them freely transact businesses in observance of Standard Operating Procedures (SOPs) Following the outbreak of Covid-19 pandemic in the region, EAC countries restricted movement of people across their boundaries, allowing only cargo trucks. This left out small scale traders who used to move with their goods on buses and other means of transport stranded with their merchandise. “Covid-19 is here to stay; we must all work to keep each other safe and productive instead of increasing vulnerability to those who have been already marginalized,” said Shiela Kawamara executive Director EASSI one of the participants.
Comesa free trade spirit threatened as duty deal in abeyance (The Star)
Kenya risks falling out with other Common Market for Eastern and Southern Africa (COMESA) member states following plans to impose taxes on imports from these regions.This comes amid lack of a clear position on the COMESA-EAC-SADC Tripartite Free Trade Area (TFTA) agreement, exposing cross-border trade to high tariffs. “We have been instructed by the Commissioner Customs and Border Control to reject all Comesa entries and notify the clearing agent or importers to pay the requisite taxes,” a KRA internal communication seen by the Star reads in part. This is against the intentions of the TFTA which seeks to ensure no tariffs are levied on COMESA originating products, whilst each member state applies its own regime of tariffs to goods imported from outside the region.
Zambia says Africa’s economic transformation lies in enhancing value addition to products (Xinhua)
The Zambian government said on Wednesday that Africa’s economic transformation lies in the ability to increase value addition and strengthening the participation of small and medium-sized enterprises in national and regional supply chains. In remarks delivered at an online training program for local sourcing for partnership meeting between buyers and sellers organized by the Common Market for Eastern and Southern Africa (COMESA) Business Council (CBC), the government official said it was vital to improve technical capacity and linkages of small and medium-sized enterprises to markets.
COVID 19: ECOWAS endorses guidelines for movement across borders (TheCable)
The Economic Community of West Africa States (ECOWAS) has endorsed a unified guideline for movement across borders within the sub-region. The approval was granted by ECOWAS authority of heads of states and government at its 57th ordinary in the Republic of Niger on Monday. “In this regard, the heads of state and government endorsed the immediate application of the ECOWAS harmonised guidelines on cross-border transport, trade and health protocols in the COVID-19 pandemic and post-recovery within the ECOWAS region recommended by the Ministerial Coordination Committees on Health and Transport & Trade.
Traditional markets, small-format shops account for 90% of urban food retailing in Africa – Report (Premium Times Nigeria)
Traditional markets and small-format shops currently account for 80 to 90 per cent of urban food retailing in African cities, a report has shown. The pdf 2020 Africa Agriculture Status Report (AASR) (9.93 MB) was launched on Tuesday at the African Green Revolution Forum (AGRF) virtual summit in Kigali, Rwanda. The report said small farmers reach urban food markets primarily via traditional wholesale markets. “The efficient operation of these markets, therefore, becomes key to small farmer access and competitiveness,” reads the report.
See also: 5 ways urbanization is changing agriculture in Africa (Devex)
‘Africa must learn from past experience’ (The Herald)
Africa must learn from past experience and knowledge to chart its future development and the improvement of the livelihoods of the continent’s citizens, President Mnangagwa said yesterday while launching the first edition of the African Fact Book at State House. “Furthermore, let us draw from our African heritage and knowledge to develop new technologies, innovations and systems that will improve our agriculture practices, accelerate the industrialisation and modernisation of our economies, and ultimately lead to a better quality of life of our people,” said President Mnangagwa.
The African Development Bank’s Board of Directors on Wednesday approved $27.33 million in grants to boost the African Union’s (AU) efforts to mobilize a continental response to curb the COVID-19 pandemic. Speaking after the Board approval of this operation, President Adesina said: “The African Development Bank will strongly support Africa to get through the COVID-19 pandemic and build back, strongly and smartly. The Bank’s financial support to the Africa Centers for Disease Control, reaffirms our strong commitment to regional efforts to tackle the pandemic being coordinated by the African Union. Africa needs a well-financed Africa Centers for Disease Control, today and for the future.”
Horn of Africa Cooperation: Mixed responses to new regional bloc (The Africa Report)
Relations in the Horn of Africa are complex and complicated. Creating an economic and political bloc may seem a solution to bring peace and boost trade. But it risks sparking distrust from other East African countries, and with the other regional body, IGAD.
Adesina’s five-point agenda and Nigeria’s readiness – The Sun Nigeria
The Board of Governors for African Development Bank (AFDB) recently re-elected Mr Akinwumi Adesina for the second time. In an interview with the Director General of National Association Of Chambers of Commerce, Industry, Mines and Agriculture (NACCIMA), Ayo Olukanni said the five-point agenda of the AFDB as unveiled by Dr Adesina are priority areas which are interlinked and deserve equal attention across board, however, strategic implementation must be pursued in an integrated manner to achieve the said agenda. The NACCIMA DG revealed that for Nigeria to gain from African Continental Free Trade Agreement (AfCFTA), Adesina must ensure prompt ratification and continued sensitization and education as being done by the National Action committee of the AfCFTA.
UN at 75: Reaffirming global commitment to multilateralism (The New Times)
The world will on September 21 mark the 75th Anniversary of the United Nations. The day will be marked with a one-day high-level meeting of the UN General Assembly among other activities to celebrate this milestone. The day will be marked under the theme: The Future we Want, the UN We Need: Reaffirming our Commitment to Multilateralism. Ahead of the celebrations, The New Times’ Sharon Kantengwa had an interview with Fodé Ndiaye, the UN Resident Coordinator for Rwanda who shared some milestones of the UN in Rwanda.
Global news
Algeria backtracks on its free trade deal with the EU (The North Africa Post)
Algeria has asked the EU to put on hold a free trade agreement that was due to be signed this year as it drags its feet on customs reforms, an EU official said. Under the Association Agreement between the two countries, Algeria should have entered into an FTA with the EU in 2017 but has asked for three more years to prepare its customs for the deal.
The Time to Prepare for COVID-19 Vaccine Transport is Now (IATA)
The International Air Transport Association (IATA) urged governments to begin careful planning with industry stakeholders to ensure full preparedness when vaccines for COVID-19 are approved and available for distribution. The association also warned of potentially severe capacity constraints in transporting vaccines by air. Air cargo plays a key role in the distribution of vaccines in normal times through well-established global time- and temperature-sensitive distribution systems. This capability will be crucial to the quick and efficient transport and distribution of COVID-19 vaccines when they are available, and it will not happen without careful planning, led by governments and supported by industry stakeholders.
In the COVID-19 world, risk has become riskier – IMF (ZAWYA)
While the global economy faces exceptional challenges amid pandemic, market volatility, defaults and evolving regulations are set to change the landscape for the financial sector, according to a senior IMF official.On the financial front, individuals, businesses, and countries need phenomenal adjustments to the changes fueled by the ongoing COVID-19 situation, said Geoffrey Okamoto, the first deputy managing director of the International Monetary Fund (IMF). ”Regulations may also change, as policymakers seek to prevent a recurrence of the volatility and reduce the need for central bank interventions to preserve market functioning,” he said in the report.
ITU launches Connect2Recover to reinforce digital infrastructure in countries affected by COVID-19 (ITU)
The International Telecommunication Union (ITU) has launched Connect2Recover with the support of the Ministry of Internal Affairs and Communications of Japan and the King Salman Humanitarian Aid and Relief Centre of Saudi Arabia to help countries recover from COVID-19 by expanding access to affordable and reliable connectivity. Connect2Recover will initially focus on selected countries in Africa which are some of the least well connected countries and likely to be hit hard by the pandemic in socio-economic terms.
Finance Ministers meet to refine ‘single ambitious menu’ for COVID-19 recovery and beyond (UN News)
Amina Mohammed addressed ministers from UN Member States, and representatives from international institutions, during a virtual meeting on Tuesday to solidify a “menu” of policy options for post-pandemic recovery and beyond, which will be presented to world leaders later this month.
On 21 August 2020 the seventh round of the negotiations on a new partnership between the EU and UK concluded. As had been expected, there was no breakthrough, and both chief negotiators, Michel Barnier for the EU, and David Frost for the UK, confirmed that substantial differences remain, with the former emphasising that he was disappointed by the lack of progress.
Position Paper of the People’s Republic of China On the 75th Anniversary of the United Nations (MFA China)
We must uphold the WTO-centered and rules-based multilateral trading regime, promote trade and investment liberalization and facilitation, and build an open world economy. We should all create an enabling environment for sustainable development and make economic globalization more open, inclusive, balanced and beneficial to all.
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tralac Daily News
National news
South Africa’s GDP tanks 51% in the second quarter (BusinessTech)
South Africa’s gross domestic product (GDP) dropped by a massive 51% in the second quarter of the year, reflecting the immense damage done to the economy by the Covid-19 lockdown. This pushes South Africa even deeper into recession, after GDP growth for 1Q20 was recorded at -2%, following drops of 0.6% in 3Q19, and 1.4% in 4Q19.
Manufacturing contracted by 74.9% in the second quarter. All ten manufacturing divisions reported negative growth rates in the second quarter. The agriculture, forestry and fishing industry was the only positive contributor to GDP growth, with an increase of 15.1% and a contribution of 0.3 of a percentage point to GDP growth. The increase was mainly due to increased production of field crops and horticultural and animal products.
Economists have flagged concerns that the country’s fiscal situation, corruption allegations, and weak growth prospects will continue to weigh negatively on investor confidence, reduce the attractiveness of the country’s assets and potentially undermine foreign capital inflows. Growth is expected to recover in the third quarter; however, South African consumer confidence remains at an almost three-decade low.
Citrus industry negotiates a new trade deal (IOL)
After eleven years of negotiations, South Africa’s citrus industry has been given the go-ahead to export to the Philippines, with the signing of a work plan between the Department of Agriculture, Land Reform and Rural Development, and the Philippines Bureau of Plant and Industry. “The South African citrus industry remains an important sub-sector in agriculture and the department appreciates the ongoing efforts of all concerned parties to ensure promotion, retention and optimisation of South Africa’s export markets for fresh fruit. Both industry and the department will soon communicate to all relevant role players the detailed prescripts of the exports agreement reached with the Philippines towards ensuring full compliance,” the department said.
Kenya’s manufacturers need external financing to survive (The Africa Report)
Kenya urgently needs a credit guarantee scheme to protect small and medium-sized businesses from the impact of COVID-19, Kenya Association of Manufacturers (KAM) CEO Phyllis Wakiaga tells The Africa Report. Wakiaga met the central bank and the government last week to discuss such a plan, which for now remains a “work in progress.” The government, which has committed some money, needs external partners to financially contribute to the scheme, with development finance organisations a possible avenue, she says. “It’s an urgent priority.”
Kenyan truck drivers to pay the price for Uganda Covid-19 tests (Business Daily)
Transporters have accused Kenya of inefficiencies in carrying out Covid-19 tests, forcing local truck drivers to flock to Uganda where the service is rendered with fewer hurdles. The transporters say because of the influx of Kenyan cargo crew to Uganda to have Covid-19 certificate, the neighbouring country has introduced a levy for the test, a move the players say will push up the cost of goods for consumers.
Mthuli admits Zim economy under negative growth but says better than rest (New Zimbabwe)
Finance Minister Mthuli Ncube has admitted the country’s economy was experiencing negative growth although insisting it was not the worst such battered economy in the world. Addressing parliament last week, Ncube said the negative trajectory was not only unique to Zimbabwe but was now a world phenomenon caused by Covid-19. Ncube was responding to contributions by MPs after a report on the mid-term budget and economic review statement to parliament by Budget and Finance Committee chairperson Felix Mhona. “The report notes the anaemic growth, generally due to Covid-19 that is panning out across the globe, in fact a negative growth frankly,” Ncube said.
Tanzania: Resumptions of passengers, freight operations to spur northern regions economic growth (Dailynews)
The revival of the passengers and freight operations to the northern regions has marked a major milestone of the government quest to increase efficiency and speed up the country’s economic development. Due to the role it performs in growth and development process, reliable and efficient railway networks provide good physical connectivity to the urban and rural areas which are essential for economic growth.
‘Covid 19, non tariff barriers killing regional trade’ – Experts (The Independent Uganda)
Uganda has condemned the continued use of non-tariff barriers by her East African Community neighbors despite several petitions, saying it beats the purpose for which the community was created. Recently, sugar exports to Tanzania have been blocked and returned to Uganda, while Kenya has often blocked Uganda’s sugar, poultry, and dairy products. And in all instances, exporters say, there are no proper reasons given The Assistant Commissioner for Regional and Bilateral Division External Trade at the Ministry of Trade, Richard Okot Okello, says there must be renewed efforts to remove all barriers if intra-regional trade is to be revamped.
Ghana and Côte d’Ivoire taste success in raising price of cocoa (The Africa Report)
Through a joint initiative, Ghana and Côte d’Ivoire have managed to convince chocolate traders and makers to raise the price they pay for cocoa. With Côte d’Ivoire and Ghana, the world’s top two cocoa producers, as well as Nigeria, which ranks fifth behind Ecuador and Cameroon, ECOWAS member countries account for 68% of global cocoa supply. In other words, 3.4 million tonnes were harvested in the 2019-2020 season, out of a worldwide total of 5 million tonnes. The problem is that Africa’s cocoa producing countries capture just 3% of global chocolate industry revenue, according to figures from the International Cocoa Organization (ICCO).
The port of Lomé is a top transshipment platform for goods transiting to Sahel countries (Togo First)
At the fifteenth position, worldwide, and first in Africa, under the Starting a Business index of the 2020 Doing Business ranking, Togo sustains its reformative dynamics with more reforms. In comparison to previous years, Togo has significantly improved its ranking under the”Trading across borders” indicator by adopting multiple reforms that focus mainly on the digitization and reduction in delays, for import and export procedures related to import and export. Togo has significantly improved its ranking on the “Trading across borders” index by adopting multiple reforms that focus mainly on the digitalization and reduction in delays, for import and export procedures related to import and export.
Ethiopia faces series of challenges on international and domestic fronts (Egypt Independent)
Ethiopia’s government, led by Prime Minister Abiy Ahmed, has found itself in a quagmire of rising domestic and international tensions, raising fears for the survival of the government in question. For almost a decade, Egypt, Ethiopia, and Sudan have been engaged in negotiations on the Grand Ethiopian Renaissance Dam (GERD), to conclude an agreement, governing both the filling and the operation of the dam. Earlier this year, the US tried to mediate the talks, but Ethiopia walked away amid accusations that Washington was siding with Egypt. Now the three countries are engaged in dialogue under African Union supervision, yet no breakthrough was reached.
Nigeria: Economic group calls for re-opening of closed borders (Journal du Cameroun)
The Nigerian Economic Summit Group (NESG) has urged the Nigerian Government to expedite actions at re-opening its closed borders given its negative impact on trade and employment.In a statement released on Tuesday in Abuja entitled “Matters of Urgent Attention”, the NESG noted that Nigeria’s role in ECOWAS should not be limited to security and diplomacy, “but must also effectively harness trade opportunities within the sub-region. “We remain of the firm belief that with the necessary infrastructure, the Nigerian economy and the Nigerian people, with our innovative capacity, hard work and creativity, will be one of the greatest beneficiaries of African and West African free trade. This will also enable fair competition, competent institutions, efficiency and transparency in our processes,” the group said.
Regional and continental news
AGRF: Conditions to Feed Africa Amidst Rising Urban Populations – Speakers (AgroNigeria)
Improving Africa’s urban food system governance can help to sustainably feed the expanding population size in urban cities Rudy Rabbinge, a Professor Emeritus of Sustainable Development and Food Security, made the submission on Tuesday while delivering a keynote address at the launch of the African Agriculture Status Report (AASR). The AASR launch was one of the activities for Tuesday in the ongoing African Green Revolution Forum (AGRF) Virtual Summit which started on September 7th and ends 11th.
Trudi Hartzenberg, Executive Director of the Trade Law Centre (TRALAC), on her side, proposed digital trade solutions to the problems of continental trade movements such as documentation. On food safety, Hartzenberg pinpointed the need to strengthen national laboratory structures to provide assurance to both producers and the final consumer of food products.
Related: Africa agric stakeholders call for resilient food system, intra-African trade (Naija247news)
AfCFTA’s postponement affords Nigeria time for ratification – official (Naija247news)
The Nigerian Office for Trade Negotiations (NOTN), says the postponement of the commencement of African Continental Free Trade Area (AfCFTA) will afford Nigeria the opportunity to ratify the agreement. Mr Victor Liman, the Acting Chief Trade Negotiator and Director-General, NOTN said the postponement gave Nigeria sufficient time to ratify the AfCFTA agreement. “On the other hand, in as much as the postponed period presents an opportunity for Nigeria and other signatory states to ratify the agreement, it can also result in a reluctance to ratify, thereby delaying the speed of further negotiations on trade,” he said.
EAC rolls out Regional Electronic Cargo and Driver Tracking System
The East Africa Community (EAC) Secretariat and its Partner States held a virtual roll out event on Tuesday to mark the technical completion and development of the Regional Electronic Cargo and Driver Tracking System (RECDTS). RECDTS is designed as a mobile phone application and will enable the issuance of the EAC COVID-19 digital certificates that are mutually recognised by Partner States, thus eliminating need for multiple testing as well as contributing to alleviating ongoing congestion at East Africa border crossing points.
Unconventional monetary policies necessary to address the impact of COVID-19 (COMESA)
Central Banks in the COMESA region has been implementing new policy instruments and made changes to their monetary policy frameworks in order to address low growth and increase in unemployment resulting from the negative impact of COVID-19.According to a special report published by the Director of the COMESA Monetary Institute (CMI), Mr Ibrahim Zeidy, most of the banks in the region and beyond are applying different combinations of what have been labelled as Unconventional Monetary Policy Tools (UMPTs) and adapted their operations to the circumstances in their jurisdictions. “Central Banks should consider lowering the interest rate to increase loans to businesses (and decrease their cost) and provide commercial banks with more liquidity to support business activities,” the director says.
ECOWAS postpones single currency launch (The Nation Nigeria)
The Economic Community of West African States (ECOWAS) has postponed the launch of its planned single currency “ECO”, it was learnt. “The authority expresses satisfaction at the improved status of macroeconomic convergence in ECOWAS in 2019, compared to 2018. Nevertheless, it notes that while the convergence phase ended on 31 December 2019, the necessary conditions for ECOWAS to move into the stability and performance consolidation phase have not been met, as set out in the Macroeconomic Convergence and Stability Pact among ECOWAS Member States. It also notes the negative impact of COVID-19 on Member States’ compliance with ECOWAS macroeconomic convergence in 2020,” the communique stated.
Kenya Secures First Horn of Africa Initiative Project to Boost Regional Integration and National Development (Mirage News)
he World Bank Board of Directors today approved $750 million in International Development Association (IDA) financing to improve the movement of people and goods, digital connectivity and access to social services for over 3.2 million people living in the North Eastern region where the Isiolo-Mandera Regional Road Corridor traverses. Through the new operation – the Horn of Africa Gateway Development Project (HoAGDP) – the World Bank will finance the upgrading of 365 kilometers of the 740-kilometers Isiolo-Mandera Regional Road Corridor and 30km of spur roads, while the upgrading of the remaining sections will be financed by other development partners.
Young Africans need more and better jobs, not more training (Brookings)
When the world rebuilds after the COVID-19 crisis, Africa will have a unique challenge to face: bringing its overwhelmingly young workforce into decent, productive, and secure jobs. Even before the global pandemic, many young Africans struggled to find productive employment, often finding themselves underemployed or perpetually engaged in low-paid, low-productivity, precarious self-employment. This trend, paired with a persistent, although, we argue, unfounded, worry among political leaders and the international community that some frustrated young people may turn to violent crime, militant extremism, or protest, has fostered a plethora of youth employment initiatives.
Shining a light on women in transport (Sandton Chronicle)
Increased female participation remains beneficial for the economy at large and transport is not different. To shine a light on the importance of having female players in the private and public sector, Consumer News and Business Channel Africa (CNBC Africa) and the Department of Transport partnered with the Rail Safety Regulator (RSR) to host a panel discussion on 25 August.
AfrIPI endorses Intellectual Property cooperation plan in Africa (EUIPO)
AfrIPI, the first-ever African cooperation project focusing on Intellectual Property Rights, held its inaugural Project Steering Committee (PSC) meeting on 7 September. “The reason why cooperation is so important is that IP rights are closely related to economic wellbeing – in particular sustainable development, the creation of quality jobs, and of balanced trading conditions. In a globalised economy, especially with the internet by-passing physical borders, it is essential that IP rights are understood in a common way and also protected” said Christian Archambeau, EUIPO Executive Director.
Global news
Sub-Saharan Africa to benefit €5bn from EU green plan (Premium Times Nigeria)
Sub-Saharan Africa will benefit five billion euros from the EU Green Economy Recovery Plan, an EU official has said. Speaking at a panel discussion tagged: “The Key Role of SMEs in Serving Urban Food Markets,” Mr Mizzi said the fund set aside for sub-Saharan Africa was part of the EU’s seven-year green plan from 2021 to 2027. “Sub-Saharan Africa will benefit around five billion euros. The money is a composite amount for emergency, humanitarian with a focus on saving lives but it was also made to address water, health, sanitation and social economy.” He said that sub-Saharan nations should focus on developing local and regional markets as well as bridging infrastructure gaps.
Germany’s Marshall Plan with Africa marks a new era of cooperation between Europe and Africa that could drive industrial development and deliver huge opportunities for the Africa’s fast-growing youth population, according to speakers at the #GMIS2020 Virtual Summit, which took place from September 4-5. H.E. Ebrahim Patel, Minister of Trade and Industry of South Africa, spoke of the urgent need for Africa to start living up to its true potential by increasing its GDP and providing employment for a burgeoning youth population. Developing a strong manufacturing base, he said, was one way to shift from being a provider of raw materials and unprocessed agricultural products to becoming an importer of consumer goods.
“African countries are learning the hard lesson that we cannot remain simply exporters of raw materials and importers of finished goods like medical supplies and processed food products,” he said. “We must confront uncomfortable facts and deal with Africa’s position in the global economy. Africa has 17% of the world’s population, yet only 3% of the world’s GDP, 2% of the global manufacturing output and 1% of global steel production.”
Auditors call for overhaul of EU’s Africa spending (EURACTIV)
The European Court of Auditors, which monitors European Union spending, has called for an overhaul of the bloc’s development spending programmes for African, Caribbean and Pacific (ACP) countries to prioritise domestic manufacturing and energy. In a report published on Tuesday (8 September) examining the use of €435 million of EU funding to Kenya between 2014 and 2020, the Court found that the bloc’s ‘standard formula’ for allocating cash to African countries “does not address their specific development obstacles or the funding gap
African leaders are expected to demand more support for their manufacturing, agriculture and energy sectors at an EU-African Union summit scheduled for October, although EU officials are tight-lipped on whether the summit will have to be postponed as a result of COVID-19. The summit had been ear-marked as the setpiece when the two sides would agree on a ‘strategic partnership’ between the two continents.
Angola and the EU strengthen their multidimensional partnership and increase Covid-19 response by €20 million (European External Action Service)
As the fourth biggest economy of Sub-Saharan Africa, and with its geographical position - straddling central and southern Africa - Angola has an important role to play to contribute to regional stability and promoting democratic values in a region where several neighbouring countries are facing domestic challenges and where persistent drivers of conflict are present. Angola has faced serious recessionary pressures, linked to a combination of factors including a severe reduction in oil revenue and the COVID-19 pandemic. President Joao Lourenço, elected in 2017, has dedicated his leadership to modernizing the economy, improving the business and investment climate and deepening the democratic system.
WTO Director-General Selection Process: Candidates Present Their Visions, Final Phase Kicks Off (SDG Knowledge Hub | IISD)
The third and final phase of the World Trade Organization (WTO) Director-General selection process has commenced, after eight candidates for the post (from Egypt, Kenya, the Republic of Korea, Mexico, Moldova, Nigeria, Saudi Arabia, and the UK) “made themselves known to members.”
Abdel-Hamid Mamdouh (Egypt) emphasizes the need for “a different type of leadership,” where the WTO Director-General is a “trusted advisor,” “honest broker,” and facilitator, enabled by knowledge of the multilateral trading system and impartiality.
Ngozi Okonjo-Iweala (Nigeria) offers to “bring a fresh pair of eyes to the WTO’s challenges,” including “renewing and improving” the Organization. Her vision is “a WTO with Purpose,” where trade helps foster economic growth and sustainable development, “fresh challenges” such as ensuring complementarity between trade and the environment and responding to the realities of e-commerce and the digital economy are addressed, and solutions to the dispute settlement “stalemate” are found.
Amina C. Mohamed (Kenya) identifies reform, recovery, and renewal as the three main themes of her vision for the WTO. She stresses the need “to recapture the visionary inspiration of the original architects of the system” and “breathe new life into the WTO” so that it can assist in COVID-19 recovery by helping rebuild economic resilience to boost growth and sustainable development.
Fashion and the end of the Brexit transition period – What next? (Apparel Sourcing & Textile Industry News)
With less than four months until the end of the Brexit transition period on 31 December 2020, fashion businesses need to prepare. Here, Stephen Sidkin and Charlotte Kong from Fox Williams solicitors set out some of the key points businesses should be thinking about as the deadline looms. The publication last month by the European Commission of ‘Getting ready for changes: Communication on readiness at the end of the transition period between the EU and the UK’ is worth consideration. The Communication – a copy of which can be found here – provides a business sector by sector overview of the main areas where changes will arise irrespective of the outcome of current EU-UK trade negotiations.
Public procurement is a powerful tool for sustainable development – UN report (UNCTAD)
Strategic government spending on goods and services can increase the uptake of sustainability standards in the wake of COVID-19, driving our sustainable development ambitions.As governments respond with unprecedented spending to combat the coronavirus pandemic, a new report released by the United Nations Forum on Sustainability Standards (UNFSS), urges them to ensure public procurement does no harm to people and the planet.
DDG Wolff: Trade, global cooperation can best deliver adequate medical supplies (WTO)
Six months into the pandemic, its onslaught against the world’s population has not ended. Supply issues, in countries where the pandemic has eased, are less acute, but remain. While a stockpile might provide some cushion, a surge in critical demand needs to be met either from international trade or, as another option, increased manufacturing output.
The third option for access to medical supplies – relying on imports – works well in general but not necessarily in the short term. At the onset of a pandemic, demand for essential products skyrockets everywhere – if not all at once, then in waves that arrive close enough together to put pressure on the supplies available for trade. Imports may also be less available due to export controls in their country of manufacture or due to pre-emptive purchasing by foreign governments. Importing can also, as a practical matter, be constrained by an importing country’s financial capacity.
LDC group to seek support for 10 years after graduation (The Financial Express)
The group of least developed countries (LDCs) has opted to request the rich nations for extending support measures, available to the graduating LDCs, for at least a period of 10 years after they are excluded from the category, officials said. The proposal will be placed in line with the UN General Assembly resolution 59/209, which stated the need for creation of “smooth transition strategies for countries graduating from the list of LDCs. The LDC group, in a draft communication, recently circulated among the member states, referred to the context of the current COVID-19 crisis “which may reverse many of the development progress, achieved so far by the graduating LDCs”.
Related News
Unconventional monetary policies necessary to address the impact of COVID-19
Central Banks in the COMESA region has been implementing new policy instruments and made changes to their monetary policy frameworks in order to address low growth and increase in unemployment resulting from the negative impact of COVID-19.
According to a special report published by the Director of the COMESA Monetary Institute (CMI), Mr Ibrahim Zeidy, most of the banks in the region and beyond are applying different combinations of what have been labelled as Unconventional Monetary Policy Tools (UMPTs) and adapted their operations to the circumstances in their jurisdictions.
In view of this, the CMI has come up with key recommendations of possible tools for the Central Banks to consider in addition to the UMPTs during this time of the coronavirus pandemic. These include the need to provide funding to market segments where liquidity has dried up.
The possible tool to consider is providing funding for Lending Schemes whereby Central Banks provide collateralized long-term funding to banks to aid monetary transmission through the banking system and to support provision of new credit to bridge financing needs of specific sectors,” Mr. Zeidy states.
However, before implementing such tools, he notes, careful consideration should be given to the potential financial risks to Central Bank balance sheets, the operational readiness of such tools, potential distortions and spill overs and the importance of transparency and accountability in the use of such instruments.
“Central Banks should consider lowering the interest rate to increase loans to businesses (and decrease their cost) and provide commercial banks with more liquidity to support business activities,” the director says.He adds that a temporary use of capital flow management measures can help prevent a free fall of the exchange rate. This is in addition to Capital flow management including a wide range of measures, such as restrictions on resident investments and transfers abroad, caps and other limitations on non-resident transfers abroad etc.
He however cautions that such measures should be implemented with due regard to countries international obligation, in a transparent manner, be temporary and lifted once crisis conditions decreases.
Other proposals made include the need for countries to initiate fiscal stimulus packages to minimize the impact of the Coronavirus pandemic on the national economies; fiscal stimulus to taxpayers impacted by COVID-19 and tax suspension, waiver of tax payments in critical sectors and encouraging local sourcing by the public sector to support Small and Medium Enterprises (SMEs) and other businesses.
Mr. Zeidy proposes that governments through Central Bank can also renegotiate external debt payment plans, and conditions to ensure smooth servicing of the debt, including suspension of interest rates payments during the time of the crisis.
For more COMESA Special Reports on COVID-19, please visit our Regional Policy Monitor page.
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Germany’s Marshall Plan with Africa will promote innovation and harness the potential of Africa’s youth
Germany’s Marshall Plan with Africa marks a new era of cooperation between Europe and Africa that could drive industrial development and deliver huge opportunities for the Africa’s fast-growing youth population, according to speakers at the #GMIS2020 Virtual Summit, which took place from September 4-5.
At a panel session on day one of #GMIS2020, representatives from the public sector discussed the factors that are needed to promote industrialisation on the African continent and how policymakers, development partners and the private sector can address these opportunities through initiatives like the Marshall Plan. The collaborative initiative aims to help bolster entrepreneurship and innovation and create the estimated 20 million new jobs needed in Africa every year.
H.E. Gerd Müller, Federal Minister for Economic Cooperation and Development of Germany, said that building EU-African relationships would be a priority under Germany’s sixth month tenure of the Presidency of the Council of the European Union, which began on July 1.
“Africa is home to six of the world’s eleven quickest-growing economies,” he said. “It has 89% of the world’s copper, cobalt, and rare earth reserves. Africa is the continent of the future. Germany has set up the Development Investment Fund, a support package of one billion euros for German and European companies that want to get involved in Africa, and for African companies seeking financial resources. Germany is supporting African efforts to strengthen inner-African trade and the diversification of exports by promoting the African continental free trade zone.”
H.E. João Manuel Gonçalves Lourenço, President of the Republic of Angola stressed the need for strong government, appropriate oversight, and flexibility in implementing the plan. “The Marshall Plan should focus the goals of the 2063 African Union agenda, whereby the EU and Africa should cooperate on a political, economic, social and cultural level in order to ensure the progress of our continent. On our side, we commit to forwarding the assistance that we’ll be receiving to the right areas in order to ensure better monitoring in the implementation of different programs. Weak leadership in projects is a waste of resources, and that is what we need to prevent.”
H.E. Albert M. Muchanga, Commissioner of Trade and Industry – African Union Commission, emphasised the importance of public-private partnerships to help Africa develop new and sustainable opportunities for young people. He said: “For us to ensure that we dynamise the process of industrialisation and also try to leverage the opportunities offered by the fourth industrial revolution, we need to develop a partnership among the governments, academia, and the private sector. We need governments to provide the policy framework and to provide public resources. And we need the private sector and academia to embark on vigorous training programmes as well as rigorous research and development programmes.”
H.E. Ebrahim Patel, Minister of Trade and Industry of South Africa, spoke of the urgent need for Africa to start living up to its true potential by increasing its GDP and providing employment for a burgeoning youth population. Developing a strong manufacturing base, he said, was one way to shift from being a provider of raw materials and unprocessed agricultural products to becoming an importer of consumer goods.
“African countries are learning the hard lesson that we cannot remain simply exporters of raw materials and importers of finished goods like medical supplies and processed food products,” he said. “We must confront uncomfortable facts and deal with Africa’s position in the global economy. Africa has 17% of the world’s population, yet only 3% of the world’s GDP, 2% of the global manufacturing output and 1% of global steel production.” Read his full remarks.
The Global Manufacturing and Industrialisation Summit is a joint initiative by the United Arab Emirates and the United Nations Industrial Development Organization (UNIDO). Under the theme – Glocalisation: Towards Sustainable and Inclusive Global Value Chains, the third edition of the Global Manufacturing and Industrialisation Summit (#GMIS2020) has gathered a cross-section of close to 100 global leaders from the world’s public and private sector to participate across more than 20 virtual sessions to discuss pathways to accelerate the role of fourth industrial revolution (4IR) technologies to build more resilient global value chains and restore prosperity in a post-pandemic world.
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DDG Wolff: Trade, global cooperation can best deliver adequate medical supplies
International trade and cooperation among WTO members are vital to ensure sufficient supplies of medical devices during the COVID-19 crisis, Deputy Director-General Alan Wolff said on 4 September.
Speaking during a virtual Panel Presentation with Andreas Freytag, Anabel Gonzalez and Joerg Wojahn on the occasion of the launch of the G20 Trade and Investment Research Network, DDG Wolff said that trade can be the most efficient and economical avenue for delivering medical devices as long as WTO members work together to assure the reliability of trade channels. This is what he said:
Supply Shortage in medical devices during the Corona-crisis: Is the solution stockpiling and less international trade?
Introduction
The pandemic appears to have caught all governments off guard. Medical equipment, from the simplest personal protective device, such as disposable masks, to the most sophisticated, such as ventilators, all were in immediate short supply. COVID-19 test kits, disinfectants and sterilization products; medical consumables (e.g. syringes, needles, certain machines, electrocardiographs and infrared thermometers), protective garments (e.g. gloves or masks), and different kinds of medical and surgical furniture(1) – all were needed, and those needs could not be fully met.
Stockpiles where they existed were wholly insufficient. Domestic manufacturing could not immediately respond. Trade did not appear to be reliable. The rules of the trading system, not being highly prescriptive, provided little comfort to those seeking foreign sources of supply.
Six months into the pandemic, its onslaught against the world’s population has not ended. Supply issues, in countries where the pandemic has eased, are less acute, but remain.
As of August 14, just three weeks ago, the United States, which one would anticipate is at least in the middle of the pack of industrialized countries for its capability to address shortages, still listed medical device shortages of various categories of personal protective gear, testing materials and ventilating equipment(2). If advanced industrialized countries are experiencing shortages, it can readily be assumed that developing countries and especially the least developed are far worse off.
This panel has been convened to examine options to deal with global crises where medical supplies are suddenly and urgently needed. Two options are mentioned in the title of the panel, stockpiling and international trade. A logical third option is government-supported investment in relevant manufacturing capacity. Each has its advantages and drawbacks. Each has a role to play in crafting a solution sufficient to meet the challenge. The most relevant of the three to the Members of the World Trade Organization (WTO) is, of course, international trade. The question to be faced at the WTO is whether international trade can be made more reliable for the remainder of the pandemic and for future global outbreaks of disease and other global crises. Underlying this question is a more fundamental one: Will world trade, on which much of global prosperity rests, grow or shrink after the pandemic?
Stockpiling
Building stocks is clearly an option for those countries with the necessary resources to do so. Stocks can be created from either domestic production or from foreign supplies when either are available. From the standpoint of international trade, creating stockpiles of emergency medical gear does not normally present any great concerns. Creating a stockpile does not limit imports. While it could affect the quantity of products available for export, that for the present is only a theoretical problem.
There are, however, practical limits to stockpiling. Respirators, for example, age and are no longer reliable. Sooner or later, stockpiles are not maintained. This has been the case in the United States, where reportedly a decade ago the outbreak of the swine flu drew down stocks of masks, and the stockpile was not replenished.(3) Earlier this year, when COVID-19 appeared on its shores, it has been estimated in one report that the U.S. stockpile of masks was enough to meet only 1% of projected national needs. France has reportedly had a similar experience.(4) There can be little doubt that these two countries were not alone in this regard.
Domestic manufacturing
The U.S. Center for Disease Control cites three measures of capacity – conventional (meeting normal needs), contingency and crisis.(5) Conventional needs are not met by stockpiles, but from commercial inventories and manufacturing that is already in place. Contingencies might be met from these sources supplemented by a stockpile.
While a stockpile might provide some cushion, a surge in critical demand needs to be met either from international trade or, as another option, increased manufacturing output. In World War II, the production in the United States of aircraft suitable for war grew from a pitiable 3600 planes in 1940 to close to an annual production rate of 100,000 by 1944. Even then, ramping up production took time. In a pandemic, even compared with fighting in a world war, there isn’t that much time.
In both cases, war and a pandemic, governments are required to step in. Production capacity existed for normal commercial demand. Market incentives were not in themselves likely to be sufficient to bring about an immediate manufacturing response. From a WTO perspective, government involvement in increasing domestic production during the pandemic has not been a matter of concern. No current fear has been expressed in Geneva at the WTO by Members that governments may overinvest in the production of personal protective equipment, creating excess capacity as has characterized the production of steel for the last half century. While industrial subsidies more generally are a topic of potential concern for future discussion, due to current shortages there is no call for governments to avoid non-economic (non-market-justified) investment in medical supplies.
A consideration for relying on a resort to manufacturing in a crisis is whether it is sufficiently flexible to convert normal commercial production to immediate needs, from fashion wear to surgical gowns, from making beer to making disinfectant (both are actual examples of successful conversions). The workforce must be as flexible as well as the machinery being adaptable. Jena is a known as a source of great scientific talent as well as manufacturing expertise. The application of science to industrial production is particularly needed to deal with a surge in demand during a crisis. Part of the agility required is not only to respond to demand but to be able re-convert to normal operations to aid in the recovery, once the health emergency has receded. Again Jena shows what can be done, moving from a state-dominated economic system to a market-driven economy, with the reunification of Germany.
In short, industry must be as shock- and heat-resistant as Jena glass to be prepared for future crises, the shape of which, and therefore needs, cannot be predicted with accuracy.
International trade
The third option for access to medical supplies – relying on imports – works well in general but not necessarily in the short term. At the onset of a pandemic, demand for essential products skyrockets everywhere – if not all at once, then in waves that arrive close enough together to put pressure on the supplies available for trade. Imports may also be less available due to export controls in their country of manufacture or due to pre-emptive purchasing by foreign governments. Importing can also, as a practical matter, be constrained by an importing country’s financial capacity.
The WTO rules do not prevent the application of export restrictions where a condition of short supply exists. Article XX of the General Agreement on Tariffs and Trade (GATT) provides as a general exception:
Subject to the requirement that such measures are not applied in a manner which would constitute a means of arbitrary or unjustifiable discrimination between countries where the same conditions prevail, or a disguised restriction on international trade, nothing in this Agreement shall be construed to prevent the adoption or enforcement by any contracting party of measures:
...
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essential to the acquisition or distribution of products in general or local short supply; Provided that any such measures shall be consistent with the principle that all contracting parties are entitled to an equitable share of the international supply of such products, and that any such measures, which are inconsistent with the other provisions of the Agreement shall be discontinued as soon as the conditions giving rise to them have ceased to exist.(6)
The WTO’s rules are enforceable, but in a global crisis, governments decide by themselves – without being required to coordinate or consult with others – whether to limit their exports. For restrictions on exports of food and other agricultural products, the WTO Agreement on Agriculture requires that the country imposing an export restriction take into account the impact on other countries. There is no parallel requirement with respect to manufactured goods. In the exigencies of a global pandemic, there is neither an established process nor understanding of how a WTO Member’s entitlement to “an equitable share of the international supply of such products” will be made operational, nor is there specific guidance as to when an export restriction should be terminated.
What the WTO does provide is transparency. Members’ were called upon in this crisis to notify their trade measures promptly. On the whole, they rose to that challenge, providing Members’ officials with information needed to better plan their countries’ responses to the global health and economic emergency.
Assuring the availability of essential medical supplies
The first two options discussed above – stockpiling and investing in additional manufacturing capacity – come with added costs and inefficiencies. Governments underwrite actions that the market will not alone support. For this reason, the solution to the problem of shortages of medical supplies will, at least for the immediate future, rely on all three methods of assuring supply – stockpiling, investment in manufacturing capacity and trade. The choices made by any individual country will depend heavily on its financial and technological capabilities, but also on its assessment of the reliability of access to supplies through trade. Of the available options, relying on international trade is the most efficient and economical choice. For these reasons, trade will, in the long run, dominate the range of solutions – if the multilateral trading system, the WTO, can help assure security of this method of supply.
Solutions put forward by WTO Members Relating to the COVID-19 Pandemic
For the WTO, the reality of the pandemic was brought home forcefully with the lockdown of its facilities on the 16th of March of this year. Activity did not cease, quite the contrary, it went online. The WTO began to collect and disseminate information on Members’ individual trade responses to the pandemic. Some Members imposed export control regimes for essential products. A substantial number suspended their tariffs on imports of critical supplies and otherwise facilitated trade. Within 9 days of the WTO lockdown, Australia, Brunei Darussalam, Canada, Chile, Myanmar, New Zealand and Singapore declared themselves committed to maintaining open and connected supply chains, ensuring that trade remained open, including via air and sea freight, to facilitate the flow of goods including essential supplies.
On the 15th of April, one month after the lockdown, Singapore and New Zealand agreed formally with each other to:
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Eliminate applied tariffs for essential goods including medical, hygiene, pharmaceutical products and agricultural products;
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Refrain from imposing export prohibitions or restrictions on essential goods including medical, hygiene, pharmaceutical products and agricultural products;
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Expedite the movement of these essential goods through sea and airports.
On 22 April, 49 countries led by Canada, accounting for 63% of global exports of agriculture and agri-food products and 53% of imports of these products, signed a joint statement expressing their commitment not to impose export restrictions on agriculture, as well as other undertakings.(7)
On 26 June, the Cairns Group (Argentina, Australia, Brazil, Canada, Chile, Costa Rica, Indonesia, Malaysia, New Zealand, Paraguay, Peru and Uruguay) issued a statement including fifteen commitments with respect to their own conduct while engaging in agricultural trade during the pandemic.(8)
Other declarations calling for increased international coordination in response to the trade effects of the pandemic have been issued. Examples include joint ministerial statements:
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On 5 May, initiated by Switzerland, and joined in by a number of other WTO Members, both developed and developing;
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On 12 May, initiated by Korea and joined in by Australia, Canada, New Zealand and Singapore, including a call for facilitation of essential cross-border travel;
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On 15 May a G20 statement calling on governments imposing COVID-19-related measures not to create unnecessary barriers to trade or disrupt global supply chains, and including the oft-repeated formula that the measures be “targeted, proportionate, transparent, temporary and consistent with WTO rules”, and a series of recommended steps to be taken to facilitate trade, including the promotion of e-commerce consistent with national laws;
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On 4 June, 10 WTO Members called upon the WTO Secretariat to prepare a factual report to facilitate Members’ understanding of COVID-19 related measures and initiatives and their impact;
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On 16 June 2020 the Ottawa Group (Canada, Australia, Brazil, Chile, European Union, Japan, Kenya, Republic of Korea, Mexico, New Zealand, Norway, Singapore and Switzerland) pledged itself to “lead by example” with respect to transparency, withdrawal of trade-restrictive measures, maintaining open trade in agriculture, fostering WTO e-commerce negotiations, promoting implementation of the Trade Facilitation Agreement and advancing identification of ways forward to facilitate trade in medical products.
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On 25 June, some thirty WTO Members called upon the European Union to suspend any action to reduce maximum residue levels for plant protection products in light of COVID-19; and
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Also, on 25 June, the African Group, cited the World Food Programme estimate that deteriorating employment and other factors may have already pushed almost 12 million people in Sub Saharan Africa into acute food insecurity since February 2020, compounding existing crises of the region. The Group called for negotiation of policy space, the elimination of trade distorting support and other agricultural negotiating objectives; it called for WTO Members to address the development aspects of e-commerce, consider balance of payments needs, and articulate special and differential treatment across all trade agreements and negotiations.
Under discussion among Members, but not yet formally tabled at the WTO, is a concept paper produced by the European Union dated 11 June. It is noteworthy for its comprehensiveness. It suggests an initiative “consisting of a possible enhancement of the current WTO disciplines applicable to trade in essential goods, a schedule of collaboration in times of crisis and the reciprocal elimination of tariffs on pharmaceutical and medical goods with a binding effect.”
The proposal is divided into three parts – permanent tariff elimination, disciplines relating to essential goods in crisis situations, and other disciplines irrespective of the crisis. The paper notes that the parties to the 1994 Pharmaceutical Agreement accounted for 90% of world trade at the time of entry into force, but now only account for 66% of the trade in these products. The Pharmaceutical Agreement has not been updated in terms of its product coverage since 2010. To this Agreement providing for duty-free treatment could be added, the EU paper suggests, medical goods.
Further, the crisis response, the Paper continues, could include limiting the duration and scope of export controls for healthcare goods, providing for an exchange of information on needs and availability, tariff suspensions, creating an understanding on the application of “the equitable share of supply” standard under the GATT’s exceptions, providing also for consultations, listing best practices for standards, streamlining customs procedures, engaging in joint public procurement while lifting adherents’ own discrimination in public procurement, reducing the burden of import licensing, and providing for enhanced transparency.
The third tranche of measures would address dealing with regulating remanufactured goods for purposes of knowledge sharing, as well as the creation of a permanent framework for collaboration and transparency.
Discussions of pandemic related proposals will continue later this month.
Long term effects on global value chains
On 14 April, the ASEAN Member States at a Heads of State meeting instructed their Economic Ministers to explore an arrangement to preserve supply chain connectivity for essential goods, having themselves resolved to “strengthen long term supply chain resilience and sustainability, including through better transparency, agility, [and] diversification. Supply chains have experienced dislocations not only at their points of inception and delivery but in between as distribution systems lost their capacity to perform as they would in normal times.
On 27 August, McKinsey Global Institute issued a brief that included the heading Moving from globalization to regionalization, stating that —
The pandemic has exposed the world’s risky dependence on vulnerable nodes in global supply chains.... We could see a massive restructuring as production and sourcing move closer to end users and companies localize or regionalize their supply chains.(9)
Looking at a number of major causes of disruption to supply chains, McKinsey, in a major study released on 6 August(10) estimated that
the five value chains most exposed to our assessed set of six shocks collectively represent $4.4 trillion in annual exports, or roughly a quarter of global goods trade (led by petroleum products, ranked third overall, with $2.4 trillion in exports).(11)
The Report does not specify that any rearrangement of supply chains will result in a major movement toward on-shoring, but that up to a quarter of current global value chains will see a shift, to diversify away from a single dominant foreign source, with some greater regionalization (near-shoring) as well as some greater reliance on domestic production. It Is important to note, that according to the survey undertaken by McKinsey, COVID-19 is not the chief motivation for changing a global supply chain for all industries. The Report cites a range of factors that can play a dominant role, including location of skill sets, climate events or other natural disasters (earthquakes, flooding and tsunamis, for example), trade disputes, geopolitics. Each can force change.
Conclusion
Dependency on imports for critical supplies is not a totally unfamiliar experience. In the 1970’s there were two oil shocks due to embargoes placed on exports by the then major producers of oil. One of the first responses was to assess the risks of the problem becoming more widespread. During the second oil embargo, when I was U.S. Deputy Trade Representative, I called for an interagency review of import dependencies that created potential vulnerability for the United States. The issue at that time involved a single primary cause: cartelization. The conclusion reached was that there was nothing comparable to U.S. dependency on foreign oil.
Being warned of the risks of supply disruptions does not always result in adequate precautions being taken. The chief economist of Shell Oil Company during the 1970s, Pierre Wack, predicted both of the two oil crises. For the first one, his company re-deployed their assets including shipping, and weathered that economic storm well. For the second, as he related the story, management heard him but did not act. The company suffered from its unwillingness to incur the costs of preparation to mitigate the harms predicted.
In response to the pandemic, ensuring security of medical supplies now deemed essential has become a high priority. For these goods, at least for the near future, just-in-time delivery within supply chains is likely to be replaced to a degree with seeking just-in-case(12) delivery, with some increases of inventories held for critical components and food stocks.
Carrying large inventories as well as public stockholding have economic limits, especially since the financial resources of both firms and governments are at a minimum. Deciding whether to even undertake these measures depends on an assessment of and appreciation of risks
Given the range of forces in operation, one can suppose that the McKinsey Report may be accurate in predicting the potential for some shrinkage of global value chains, and not due by any means solely to COVID-19. As long as the pandemic remains a threat, there will be a significant effort to avoid relying on a limited number of distant foreign sources for critical supplies. As noted, there is very likely to be some re-shoring and near-shoring of critical medical supplies (including pharmaceuticals) for countries and firms having the financial capacity to do so. But as the Report notes, weighing against this are existing supplier relationships, investments in place, and always, economic costs, all of which are strong forces that resist change.
Across the full range of goods, trade flows are likely to return to trend in accordance with established patterns as the world economy recovers from current depressed demand. Supply chains cannot and will not be rolled up completely. That is not going to happen. The answer to security in a time of pandemics, is more trade not less. For this to happen, there needs to be active engagement among WTO Members to reach agreement on rules in some cases, guidance in others, as to how an enhanced level of security can best be achieved through trade.
Notes
(1) WCO list summarized in General Council document WT/GC/211.
(2) The Food and Drug Administration is the U.S. agency providing this list. https://www.fda.gov/medical-devices/coronavirus-covid-19-and-medical-devices/medical-device-shortages-during-covid-19-public-health-emergency#shortage
(3) https://www.nytimes.com/2020/03/25/opinion/coronavirus-face-mask.html
(4) https://www.publicsenat.fr/article/politique/penurie-de-masques-une-responsabilite-partagee-par-les-gouvernements-successifs
(5) https://www.cdc.gov/coronavirus/2019-ncov/hcp/ppe-strategy/index.html
(6) GATT 1997 — Explanatory Notes (a) The references to “contracting party” in the provisions of GATT 1994 shall be deemed to read “Member”.
(7) Revised on 28 May in WT/GC/208/Rev.2.
(9) https://www.mckinsey.com/business-functions/risk/our-insights/covid-19-implications-for-business. Even more interesting is the fact that on 20 January of this year, before there was any consciousness of a pandemic in the officing, McKinsey published an article entitled Supply Chain Risk Management is Back, looking at supply chain disruptions caused by natural disasters and geopolitical interventions in trade. See:
(10) Risk, Resilience and Re-balancing in Global Value Chains, August 6, 2020 https://www.mckinsey.com/business-functions/operations/our-insights/risk-resilience-and-rebalancing-in-global-value-chains
(11) https://www.mckinsey.com/business-functions/operations/our-insights/risk-resilience-and-rebalancing-in-global-value-chains
(12) See Financial Times editorial of 22 April 2020 at https://www.ft.com/content/606d1460-83c6-11ea-b555-37a289098206
Related News
EAC rolls out Regional Electronic Cargo and Driver Tracking System
The RECDTS App is designed to stop Corona in its tracks along EAC key transport corridors
The East Africa Community (EAC) Secretariat and its Partner States today held a virtual roll out event to mark the technical completion and development of the Regional Electronic Cargo and Driver Tracking System (RECDTS). RECDTS is designed as a mobile phone application and will enable the issuance of the EAC COVID-19 digital certificates that are mutually recognised by Partner States, thus eliminating need for multiple testing as well as contributing to alleviating ongoing congestion at East Africa border crossing points.
The roll out was witnessed by the Chair of the EAC Council of Minister, Hon Prof Nshuti Manasseh, Ministers of Health from Kenya and Uganda as well as the EU Ambassador to Kenya, H.E Simon Mordue.
RECDTS provides a surveillance system to monitor long distance truckers crew health and enables contact tracing. It allows Partner States to electronically share truck drivers’ COVID-19 test results; therefore, minimising need for multiple COVID-19 tests in a single trip. The reliance on manual certificates and delayed test results at the borders has been reported as one of the main reasons of long delays at border points, such as those witnessed in Busia, Malaba, Nimule and Elegu. Some of the delays have caused tail backs of trucks measuring tens of kilometres in some cases.
The development of EAC the app with funding from European Union, Global Affairs Canada, Danida, Finland, Netherlands and United Kingdom through TradeMark East Africa was in accordance with the directive given by the 1st Joint Ministerial meeting of EAC Ministers responsible for Health and EAC Affairs.
Additionally, RECDTS will contribute to protecting lives, promoting safe trade and especially continuous flow of trade, support health related protocols and facilitate safe trade. RECDTS will be in use in all Partner States and will eventually be extended to EAC neighbouring countries, particularly Democratic Republic of Congo (DRC).
The Chair of the EAC Council of Ministers who also doubles as the State Minister for Foreign Affairs and International Co-operation, Republic of Rwanda, Hon Prof Nshuti Manasseh said the effective implementation of RECDTS is critical to trade facilitation in the region as well as the recovery of regional economies. The truck driver is critical in the supply chain of this region. “In this regard, I appeal to all stakeholders to look at the positive side of things and support the implementation of the system”.
Speaking at the roll out, the EU ambassador to Kenya H.E Simon Mordue said: “A common approach to tackling the threat of Corona Virus to the East African Community’s economy is paramount. The RECDTS platform is an example of this solution, as it enables several ministries of health in the region to work together in stemming the spread of the virus across borders.” Ambassador Morude also noted that the RECDTS will provide an efficient, transparent and accessible way to support the formal trade across the EAC borders and will help in sustaining the EAC economies, now and in the near future. “
On his part, the EAC Deputy Secretary General in-charge of Productive and Social Sector, Hon Christophe Bazivamo commended the progress in the development of the RECDTS remarking, “today’s roll out proves that coordinated action at the regional and even continental level is possible, especially as we start implementation of the Africa Continental Free Trade area. This kind of coordination is evidence that we can regulate flow of trade, safeguard livelihoods and achieve competition and quality.”
Frank Matsaert the Chief Executive Officer of TMEA said that the current pandemic has in many ways revealed how crucial the facilitation of trade is in times of crisis. It shows us that trade must become more fluid so that producers are able to access markets.
The task of ensuring that imported goods reach consumers lies in the hands of truck drivers; and as the coronavirus spread in the region the transit corridors were identified as conduits for the spread of infections. In efforts to contain the spread of COVID-19, the health authorities developed protocols requiring truck drivers to be tested.
RECDTS will resolve some of the challenges that were being experienced in execution of health protocols including: Multiple testing of truck drivers at border crossing as there lacked a framework of mutual recognition; Documentary fraud; where truck drivers would forge national certificates and use them to cross borders. Conflicting test results – this would happen when the same driver tested in one country having negative results, would be declared positive after being tested again in another country.
The system is expected to be in use in all the EAC Partner States – Burundi, Kenya,Rwanda, South Sudan, Tanzania, and Uganda – and extended to EAC neighbouring countries particularly the Democratic Republic of Congo (DRC)
Background
What RECDTS will do
The RECDTS and its related components are a set of digital-based solutions aimed at:
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Enabling mutual recognition of COVID-19 test results across borders.
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Manage issuance of digital certificates for cross border movement of authorized persons during the COVID-19 Pandemic.
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Provide a cross border joint coordination framework for Ministry of Health officials along the transit trade corridor to control the spread of the virus across borders.
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Enable digital verification of transit documents and travel authorization by law enforcement, customs and immigration at border crossings and other strategic locations along the transit corridors.
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Facilitate intuitive analytics of data and surveillance of mobility related to cross border movements for better management of the Pandemic in relation to cross border mobile population segments (e.g. Truck Drivers).
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Enable cross border sharing of information relating to truck driver movement, behaviour while on transit and health status.
About East Africa Community Secretariat
The East African Community (EAC) is a regional intergovernmental organisation of 6 Partner States: the Republics of Burundi, Kenya, Rwanda, South Sudan, the United Republic of Tanzania, and the Republic of Uganda, with its headquarters in Arusha, Tanzania.
About TradeMark East Africa
TradeMark (Trade and Markets) East Africa is an aid-for-trade organisation that was established in 2010, with the aim of growing prosperity in East Africa through increased trade. TMEA operates on a not-for-profit basis and is funded by the development agencies of the following countries: Belgium, Canada, Denmark, Finland, Ireland, Netherlands, Norway, United Kingdom, United States of America as well as the European Union. TMEA has its headquarters in Nairobi, Kenya, with successful operations and offices in EAC-Arusha, Burundi (Bujumbura), Tanzania (Dar es Salaam), Democratic Republic of Congo (Bukavu), Ethiopia (Addis-Ababa), Malawi, Zambia, South Sudan, Uganda (Kampala) and Rwanda (Kigali). To find out more, please visit the TMEA website.
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Covid-19 caused disruptions to supply-lines of basic medicines and equipment needed to save lives, it imposed huge costs on local economies and it laid bare the challenges the African continent faced even before the pandemic. Global economic integration comes with clear benefits, through the access to the technologies and innovations from across the world. But the benefits of highly integrated supply-chains come with enormous vulnerabilities when they are disrupted. If there is to be a legacy from this painful period, it must be to rethink development and indeed build a continental framework for greater economic resilience and industrialisation.
New Seychelles airline to launch as cargo carrier, due to pandemic (Engineering News)
Private-sector startup airline Seychelles International Airways (SIA) has announced that it will commence operations on September 10 as a cargo-only carrier, because of the Covid-19 pandemic. It will initiate its services with a four-engined Airbus A340-600, it announced in a press conference, the Seychelles News Agency reported. “We are not focusing on passenger flights at the moment unless there is a demand or a chartered flight, which will follow all procedures of the health department,” said SIA CE Robert Marie. “We are focusing on bringing cargo into the country as we feel and have evidence that Seychelles needs cargo.”
Ports, Railways And Pipeline Agencies Commit To Joint Operations Framework (Capital News)
The Kenya Ports Authority (KPA), Kenya Pipeline Company (KPC) and Kenya Railway have formally signed a framework for joint operations under the Kenya Transport and Logistics Network to be overseen by the National Treasury (KTLN). The framework signed on Tuesday followed the establishment of KTLN on August 7 through an Executive Order by President Uhuru Kenyatta.
Sh3.3trn bulk cash transfers signal business activity uptick (Business Daily)
Real-time bank transfers of more than Sh1 million recovered from a 26-month low to touch a new monthly record in July as authorities started easing Covid-19 trade and travel restrictions. Transactions cleared and settled through the Kenya Electronic Payments and Settlement System and Real Time Gross Payment System (KEPSS/RTGS) amounted to Sh3.32 trillion in July, the month when businesses started reporting increased activity, according to latest statistics.
Ethiopia to make, export Covid-19 test kits with China’s help (The East African)
As Covid-19 cases continued to climb sharply, Ethiopia’s Ministry of Health on Sunday announced that the country will start manufacturing its own test kits with China’s help. Manufacturing the test kits locally will help Ethiopia, Africa’s second most populous nation of over 106 million people, to boost its national Covid-19 testing capacity.
FG Appeals over Deregulation, Hope Rises for Infrastructure Funding (THISDAYLIVE)
The federal government yesterday stepped up efforts on two fronts to douse tensions generated by the double whammy of the increase in petrol pump price and electricity tariffs with Vice President Yemi Osinbajo saying the hike in the cost of the two items was not to inflict pains on Nigerians. Earlier, a new tariff regime in the power sector, under which the price of a kilowatt per hour of electricity had more than doubled, had taken effect from September 1. The Minister of Finance, Budget and National Planning, Mrs. Zainab Ahmed, had last Thursday shed light on why the federal government was forced to stop fuel subsidy, saying it constituted a drain on the country’s meagre resources. She had explained that all the decisions were geared towards weathering the current headwinds posed by the COVID-19 pandemic. The presidency followed up with a statement on Sunday in which it said but for a myriad of economic challenges caused by the COVID-19 pandemic, the president would not have allowed the rise in the pump price of petrol to protect the vulnerable.
Regional and continental news
The East Africa Community Secretariat and its Partner States will virtually launch RECDTS that will issue jointly recognised EAC COVID-19 digital certificates today, 8 September 2020. The App provides a surveillance system to monitor long distance truckers crew health and enable contact tracing. It allows partner states to electronically share truck drivers’ COVID-19 test results; therefore, minimising need for multiple COVID-19 tests in a single trip. The reliance on manual certificates and delayed test results at the borders has been reported as one of the main reasons for costly long delays at border points.
AfDB contributes to regional food security through forum (Naija247news)
The African Development Bank (AfDB) says its partnership with African Green Revolution Forum (AGRF) is to promote policies aimed at ensuring food security in the continent. “As COVID-19 causes disruptions across Africa, we must prioritise policy support, especially for small and medium enterprises that produce, process and market 60 per cent of food consumed on the continent,” Mrs Wambui Gichuri, AfDB’s Acting Vice President for Agriculture, Human and Social Development, said this in a statement on Monday in Abuja. “We need to enhance movement of inputs and food, increase production of, and access to, healthy and nutritious foods, establish food security task forces in countries, as well as strengthen regional organisation capacity to monitor multi-country initiatives.”
African Green Revolution Forum targets urban food supply boost amid Covid-19 disruption (African Business Magazine)
As Africa’s food systems face up to unprecedented Covid-19 supply disruption, AGRF’s Virtual Summit begins on Tuesday in Rwanda under the theme ‘Feed the Cities, Grow the Continent’. Since the onset of the crisis however, agricultural exports have faced demand disruptions and supply chain issues, while localised pricing spikes and market and logistical bottlenecks have been seen, according to McKinsey research. Logistics costs have spiked due to travel restrictions, border checks, curfews, staff shortages, and volume reductions. Extra demand-side pressure may worsen food insecurity as incomes dwindle and food prices increase. In Kenya, pricing for most food commodities was between 4 and 27% higher than at the same time last year.
Ecobank Nigeria Set to Host Virtual Africa Trade Conference
Ecobank Nigeria, a member of the pan African banking Group has concluded plans to host its first Regional Trade Conference. The virtual forum with the theme ”Facilitating Regional Trade in the emerging AFCFTA era” is slated for the 22nd of September. Sunday Abah, Head, Trade Finance, Ecobank Nigeria noted: “Ecobank’s unique intra-Africa trade solutions enable settlements of international transactions and mitigation of payment risk while providing regional solutions such as issuance of payment guarantees to exporters without the need for a letter of credit and its related costs to the importer. Ecobank works closely with clients in structuring transactions, settlements, financing and risk mitigation.”
Absa commits to growing African trade with award-winning online platform (Business Day)
Absa’s online trade finance portal, Trade Management Online, guarantees its clients efficiency, convenience and protection.The group is broadening access to trade finance by digitising its trade finance offering, ensuring increased trade opportunities that boost economic growth in Africa. “Trade is critical to Africa’s growth,” says Michelle Knowles, pan-African head of trade finance product at Absa Corporate and Investment Bank. It has been hindered by a lack of access to trade finance, despite growing demand for products that give importers and exporters multiple ways of financing trade transactions and a range of proven risk mitigation options.
Comesa warns against rising pyramid schemes (The Chronicle)
THE Common Market for Eastern and Southern Africa has warned consumers in the trading bloc to be warry of the pyramid schemes that are defrauding people of their hard-earned money. A pyramid scheme is a fraudulent investment plan that has cost a lot of people worldwide their hard-earned savings. In a statement, the Comesa Competition Commission (CCC) said its attention had been drawn to the activities of a scheme known as ‘Crowd1’, which markets itself as a digital multi-level firm and whose operations are being investigated in some jurisdictions.
SADC convenes Webinar to showcase the African Medical Supplies Platform
On 4th September 2020, SADC Secretariat, in partnership with the United Nations Economic Commission for Africa (UNECA), Afreximbank, African Centre for Disease Control (CDC) and African Union Special Envoy, Mr Strive Masiyiwa, convened a virtual meeting to discuss the opportunities offered by the African Medical Supplies Platform (AMSP) to SADC Member States. Delivering remarks on behalf of SADC Executive Secretary, Deputy Executive Secretary, Corporate Affairs, Ambassador Joseph Nourrice highlighted that the initiative came at the right time for SADC to propel the efforts towards pharmaceutical manufacturing; to provide an efficient, innovative and cutting edge system to eliminate procurement bottlenecks, in the face of the COVID-19 pandemic.
We’ve eliminated over 95% of trade barriers along borders – ECOWAS (Vanguard)
The Economic and Community of West African States, ECOWAS on Monday said it has eliminated over 95% of trade barriers along borders for member states under the ECOWAS Trade Liberalization Scheme, ETLS. This was as it said that Nigeria alone accounts for 60 to 70 per cent of products under the scheme. “Accordingly, the goal of this workshop is to articulate the views of various stakeholders on impact of ECOWAS Vision 2020, as well as the expectations of the people of Nigeria, with regards to the formulations of the ECOWAS Vision 2050 document.”
‘AfCFTA will resolve trade conflicts on the continent’ – Ghana’s Amb. to China (GhanaWeb)
Ghana’s Ambassador to China, Edward Boateng believes that the African Continental Free Trade Area (AfCFTA) will present numerous opportunities to the continent and resolve petty trade disagreements amongst countries. With the AfCFTA bringing a lot countries together, he is of the view that intra-trading amongst countries will increase trade and present the continent with a large part of the agricultural profitability cake. “I think if we can resolve the issue of production, some of these issues will resolve themselves. Why do we have our people engage a lot in petty trading? I believe it is because we lack opportunities that is why we face these problems. But the AfCFTA will help us get lots of these opportunities.”
EAC Chair Paul Kagame addresses regional relations, COVID-19 & Paul Rusesabagina’s arrest (CNBC Africa)
Yesterday during an interactive live citizen outreach interview, Rwandan President Paul Kagame answered questions about COVID-19, the recent arrest of Paul Rusesabagina and tensions between some of the members of the East African Community. Here’s some of what he had to say.
Global news
The Role of Digitalization in the Decade of Action for Africa (UNCTAD)
It is widely recognized that digitalization is one of the most powerful tools for implementing the 2030 Agenda for Sustainable Development and Africa’s Agenda 2063. Today, more than 80 per cent of Africa’s population has a mobile phone subscription. Africa is still the least connected region compared to other regions of the world with about 28,2 per cent internet coverage and 34 per cent to mobile broadband. Few citizens have digital IDs, businesses adopting digital technologies remain the exception rather than the norm, and few governments are investing strategically in developing digital infrastructure, services, skills, and entrepreneurship. There is also a need to adapt and harmonize legislations on technology, including intellectual property and data privacy, to truly unleash Africa’s digital potential.
Written by Dr. Vera Songwe, United Nations Economic Commission for Africa Executive Secretary.
Changing Global Complexities Affecting Africa’s Performance Outlook, Says Ex-President Sirleaf (FrontPageAfrica)
Former Liberian President Ellen Johnson-Sirleaf says the world is witnessing increasing complexities and shifts in alliances amid the reordering of priorities in the wake of the deadly Covid-19 pandemic. On current trends, Africa remains off track to meet the target of eradicating extreme poverty by 2030. Unless bold policy measures improve both the quality and quantity of growth, Africa would only meet the required 3 percent annual decline of the Sustainable Development Goals by 2045.”
President Sirleaf suggested that the effective mitigating policies and determined actions can change this situation and put Africa back on track. “Of course, in this regard, the primary responsibility rests with African themselves – African leaders, civil society actors, entrepreneurs, and the African people. The absolute priority must be to bring Covid-19 to an end globally through the observance of appropriate response measures, and an outreach of needed support.”
OPEN LETTER: Africa’s pandemic response calls for reclaiming economic and monetary sovereignty (Daily Maverick)
While Africa has, so far, been spared from the worst public health effects of the Covid-19 pandemic, the subsequent economic shutdown has brought Africa’s economic deficiencies and structural vulnerabilities into sharp focus. As a resource-rich continent, Africa has the capacity to provide a decent quality of life for all of its inhabitants. Africa is capable of offering universal public services, such as healthcare and education, and guaranteeing employment for people who want to work, while ensuring a decent income support system for those who cannot work. However, decades of colonial and postcolonial socio-economic dislocation exacerbated by market liberalisation have forced African countries into a vicious cycle involving several structural deficiencies, characterised by: A lack of food sovereignty; A lack of energy sovereignty; and Low value-added manufacturing and extractive industries.
Kenya’s tariff dilemma in trade talks with US (Business Daily)
Kenya’s tariff policy and market access terms are in focus in negotiating a new bilateral trade deal with the US amid calls for caution not to overexpose its nascent industrial and agricultural sectors. Though Kenya has over the years reduced its overall protectionism, tariffs remain its main trade policy instrument while juggling between boosting international trade and cushioning local producers from external competition. IDFA president and CEO Michael Dykes said in a letter to US Trade Representative, Robert Lighthizer dated August 5. “US negotiators should seek ambitious tariff reductions, including for protected dairy products in Kenya, while seeking a simplified, trade facilitative entry of US dairy imports into Kenya,” he further said.
Fear that oil firms will dump plastics in Africa (Republic World)
The oil industry has asked the United States to pressure Kenya to change its world-leading stance against the plastic waste that litters Africa, according to environmentalists who fear the continent will be used as a dumping ground. The request from the American Chemistry Council, whose members include major oil companies, to the Office of the United States Trade Representative came as the US and Kenya negotiate what would be the first US bilateral trade deal with a country in sub-Saharan Africa. “This deal will have dire consequences in terms of the environmental pollution because plastics have been touted as the major polluters of our water bodies,” said Fredick Njehu, senior political advisor at Greenpeace Africa.
World Trade Organization: How an African head could make a difference (BBC News)
With three of the eight candidates to become the next leader of the World Trade Organization (WTO) coming from Africa, BBC Africa business editor Zawadi Mudibo looks at what difference having one of them at the helm would make for the continent. Though the director-general’s role is primarily one of an administrator, an African leader could help ensure that the interests of the continent are taken into account in WTO activities. In Africa, trade is viewed as a driver of growth, a way towards sustainable development and as a tool for poverty eradication. “Foreign aid will not do it for Africa. Like everywhere else throughout history it is trade,” says David Luke, head of the trade policy centre at the UN’s Economic Commission for Africa.
The Year That Crippled Global Trade Still Poses Five Big Risks (BloombergQuint)
This year could end today and it would still rival the most challenging periods for the international trading system. But the next 3 1/2 months may bring even more potential disruptions that could secure 2020’s spot as the most turbulent in modern history. Several key events will occur that have potential to turbo-charge the global trade regime’s trajectory toward dysfunction and chaos. “There’s no question that the next three months will be pivotal for the state of global trade,” said Edward Alden, a senior fellow at the Council on Foreign Relations. With protectionism on the rise in ways similar to the lead-up to the Great Depression, “the echoes of the 1930s are pretty clear,” he said.
DDG Wolff: Trade, global cooperation can best deliver adequate medical supplies (WTO)
International trade and cooperation among WTO members are vital to ensure sufficient supplies of medical devices during the COVID-19 crisis, Deputy Director-General Alan Wolff said on 4 September. Speaking at a virtual event organized by the Friedrich Schiller University, DDG Wolff said that trade can be the most efficient and economical avenue for delivering medical devices as long as WTO members work together to assure the reliability of trade channels.
The 7th Annual Meeting of International Organisations of the Partnership for effective international rulemaking took place as a virtual meeting on 3 September 2020. Eighteen Heads of International Organisations including the WCO Secretary General, Dr. Kunio Mikuriya, participated in the High-Level Webinar on “International Organisations and their Members Facing the Global Crisis Together”. Dr. Mikuriya pointed out that in order to address the challenges regarding cooperation with other government agencies at the border and to prevent gridlock in supply chains, the WCO had teamed up with relevant public and private international organisations to undertake joint actions, including issuing joint statements and letters to remind Customs, other border agencies and the transport sector to enhance cooperation based on existing standards and guidelines. In this way, the pandemic crisis offered unprecedented opportunities to strengthen collaboration among relevant international organisations.
Economic Watch: China advances digital trade to fuel economic growth (Big News Network)
China has set its sights on the rapidly developing digital economy and digital trade to fuel economic development and seek higher-level opening-up. For China, digital trade will surely help advance its opening-up to a higher level, said vice commerce minister Wang Bingnan while addressing a forum at the CIFTIS. “Data have become the most important trading resource after capital goods,” said Huai Jinpeng, a senior official with the China Association for Science and Technology. He added that digital technologies play an increasingly important role in the services trade, and digital trade is the future of trade development.
Major energy companies lag in green shift (DW.COM)
Only 10% of global energy utility companies are expanding their renewable energy capacity at a faster rate than their gas or coal-fired capacity. That is the main finding of a study by Galina Alova from the Smith School of Enterprise and the Environment at the University of Oxford. The study, published in research journal Nature Energy, found that of the 3,000 utilities studied most remain predominantly invested in fossil fuels. And of those prioritizing renewable energy growth, 60% had not halted expansion of their fossil fuel portfolios.
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Public procurement is a powerful tool for sustainable development – UN report
Strategic government spending on goods and services can increase the uptake of sustainability standards in the wake of COVID-19, driving our sustainable development ambitions.
As governments respond with unprecedented spending to combat the coronavirus pandemic, a new report released by the United Nations Forum on Sustainability Standards (UNFSS), urges them to ensure public procurement does no harm to people and the planet.
The report explores how government spending can drive the uptake of voluntary sustainability standards (VSS) – special rules that guarantee that the products we buy do not hurt the environment and the people that make them. It is the fourth edition of the UNFSS report.
VSS ensure products are made or transported in accordance with certain sustainability metrics, such as its environmental impact, basic human rights, labour standards, and gender equality.
“The integration of VSS in public procurement and trade policies can scale up their adoption,” said Isabelle Durant, deputy head of UNCTAD, which coordinates UNFSS, a group of five UN agencies that promote these rules.
The group includes the Food and Agricultural Organization (FAO), the International Trade Centre (ITC), the United Nations Environment Programme (UNEP), and United Nations Industrial Development Organization (UNIDO).
“VSS have been recognized as potentially transformative tools for governments to realize their sustainability commitment. If used appropriately with trade policy, they could change our course toward sustainable development,” Ms. Durant said.
“But we must also ensure that small scale producers and businesses are not left behind because of stringent VSS requirements that they cannot meet.”
Sustainable public procurement a win for all
COVID-19 has obstructed economic growth, increased unemployment, exposed inequalities, and raised poverty and global hunger, rolling back the progress made in achieving the Sustainable Development Goals (SDGs).
While government spending and relief is at the heart of the COVID-19 response, there needs to also be a long-term focus on ensuring action today does not scupper our sustainability goals. More strategic public procurement can help.
Public procurement represents, on average 12% of GDP in the Organisation for Economic Co-operation and Development (OECD) countries and up to 30% of GDP in developing countries.
But VSS adoption rates vary significantly by country. A sustained effort by governments to use sustainable public procurement could change this, the report finds.
Ms. Durant added: “The coronavirus has exposed vulnerabilities and risks in our systems and business models. We now need to take this opportunity to build a more sustainable future and thus put the SDGs at the heart of policy-making.”
The policy prescription
Integrating sustainable development in public procurement and national trade policy is a starting point, the report finds.
The analysis shows that VSS adoption rates are more feasible for open economies with diversified economic sectors such as those that belong to large developed and middle-income countries.
True adoption of VSS standards by lower-income nations requires a relatively well-functioning government system, government capacity and the ability to meet the global demand for products.
The report also shines a light on how poorer people and producers struggle to meet VSS certifications due to time, cost, and capacity challenges. They get “stuck at the bottom” while wealthier producers and nations can more easily certify and invest in systems that support certification.
There is an upside in that between 2010 and 2017, VSS increasingly featured in free trade agreements, driven by the European Union’s promotion of fair and ethical trade in its trade policy.
The report says more national focus on VSS and sustainable public procurement hold the key to wider adoption of these standards globally.
It proposes five key steps that countries can take to integrate VSS into public policy:
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Enhance national capacity through a governance model that involves independent certification bodies to cope with rising demand as the number of VSS grows.
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Incorporate VSS within the trade regime with a database that uses the Standard International Trade Classification to provide an overview of the commodities covered by the standards.
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Avoid the proliferation of VSS systems through convergence and divergence of recognition mechanisms.
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Curb over-certification through appropriate measures.
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Conduct political dialogue on the benefits of scaling up VSS.
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The Role of Digitalization in the Decade of Action for Africa
It is widely recognized that digitalization is one of the most powerful tools for implementing the 2030 Agenda for Sustainable Development and Africa’s Agenda 2063.
Digital applications are already driving socio-economic transformation, increasing efficient production and distribution of goods and services, opening up new opportunities for income generation for millions of poor people, enhancing connectivity between people, societies, government, and organizations.
In the last fifteen years, the growth of digital technology, mainly driven by the mobile revolution and associated innovations has been one of the bright spots for Africa’s development. This progress has also raised hope that we can truly accelerate the implementation of the SDGs.
Today, more than 80 per cent of Africa’s population has a mobile phone subscription.[1] Africa is still the least connected region compared to other regions of the world with about 28,2 per cent internet coverage and 34 per cent to mobile broadband. Few citizens have digital IDs, businesses adopting digital technologies remain the exception rather than the norm, and few governments are investing strategically in developing digital infrastructure, services, skills, and entrepreneurship.
There is also a need to adapt and harmonize legislations on technology, including intellectual property and data privacy, to truly unleash Africa’s digital potential.
To tackle these challenges, ECA, through its Centre of Excellence for Digital Identity, Trade and Economy, established in 2018, is providing the necessary support to Member States to use digitalization, as catalyst for inclusive and sustainable growth in Africa, contributing significantly to the attainment of the sustainable development goals (SDGs).
Together with the African Union Commission, we have developed and started to implement the African Union’s Digital Transformation Strategy for Africa (2020–2030) as a blueprint and master plan for transforming the continent’s economy and societies.
ECA in collaboration with the World Bank and others UN System Agencies is also undertaking country level engagement to support the design and implementation of digital ID programmes, including exploiting linkages with the broader digital economy for achieving SDGs.
Over 60 per cent of men and 75 per cent of women are engaged in informal economic activity in Africa and providing support to this majority has challenged all African Governments in this era of COVID19. The ‘digital identity’ goal for all of Africa can help to ensure that development touches everyone and that no one is left behind.
ECA has also sought to ensure that African countries can leverage the digital space to respond to the COVID19 crisis more quickly and robustly.
ECA, in collaboration with several telecommunications companies operating on the continent (MTN, Orange, Airtel, Vodafone, etc.) has developed and launched an Africa-wide COVID-19 digital platform to support member States to enhance their ability to analyse the situation, implement the necessary responses, and direct resources to mitigate and curb the health and economic impacts of the pandemic.
Digitalisation is also a critical component to unlock the full potential of the African Continental Free Trade Area (AfCFTA). Reinforcing the capacity of African firms and entrepreneurs to trade easily within Africa’s borders and reach a global marketplace requires significant progress in Africa’s digital infrastructure, as well as a focus on regulations that protect and enhance digital trade.
Investments in digitalisation can also be developed through public private partnerships, recognising the multiplier downstream benefits that this investment will bring. Digitalisation, leveraging the AfCFTA, can be a tool for reducing inequality significantly, as it can facilitate reaching even the most marginalised and vulnerable.
Finally, our ability to convene and unite around common causes is ever more necessary – even if the reality of the pandemic makes it hard to do so. ECA has aimed to increase spaces for exchange and promotion of knowledge through multi-stakeholder platforms and a series of regional meetings.
ECA has held its annual Africa World Summit on Information Society Regional Review as a key forum for positioning ICTs as a means of implementation of the SDGs, and this has directly contributed to the agenda of the High Level Political Forum for follow-up and review of the implementation of the 2030 Agenda for Sustainable Development, the Africa Regional Forum on Sustainable Development.
The latter has included the Africa Science Technology and Innovation Forum, an initiative of the ECA, designed to support member States to leverage science, technology and innovation (STI) for accelerating the implementation of the SDGs.
We have used this forum to also build capacity among young people of our continent, by bringing them together in the format of bootcamps to introduce them to opportunities for design and innovation, and to harness the entrepreneurial opportunities associated with digitalisation.
By giving these tools to our young people we are equipping ourselves for sustainability and ensuring that we can emerge stronger and more resilient from the global shock of this pandemic.
Written by Dr. Vera Songwe, United Nations Economic Commission for Africa Executive Secretary.
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BRICS Foreign Ministers discuss topical international issues
On 4 September, Mr Sergey Lavrov, Minister of Foreign Affairs of the Russian Federation, chaired a Stand-alone Meeting of BRICS Ministers of Foreign Affairs / International Relations via videoconference from Moscow.
At the event, the Ministers held an in-depth exchange of views on topical international issues, including regional conflicts, joint efforts to counter new challenges and threats, and cooperation of the BRICS nations in multilateral fora, in particular, at the forthcoming 75th anniversary session of the UN General Assembly.
They conducted a comprehensive analysis of the current condition of pentalateral cooperation during Russian BRICS Chairmanship in 2020 on all three pillars of BRICS Strategic Partnership – policy and security, economy and finance, and people-to-people cooperation.
The meeting participants discussed some issues of the preparations for the 12th BRICS Summit.
They approved a Joint Media Statement following the meeting.
Foreign Minister Sergey Lavrov’s opening remarks during BRICS Foreign Ministers Council online meeting
Good afternoon, colleagues, friends,
Welcome to the BRICS Foreign Ministers Council meeting which, for obvious reasons, is being held as a videoconference, but is no less important because of that. I’m convinced we will be able to resume face-to-face meetings soon.
BRICS has established itself as an influential factor in international politics and economy. Our strategic partnership is based on commitment to dialogue, multilateralism, sovereign equality of states and the UN Charter principles.
This year, as we celebrate the creation of the UN and the 75th anniversary of Victory in World War II, which we celebrated earlier, our common collective voice in support of the democratic multipolar international order is needed more than ever. This order is based on mutual respect for the legitimate interests of all states, non-interference in their domestic affairs, and respect for the norms and principles of international law.
The role of the states, that are part of our association, in global trade and global economic growth is steadily increasing. In 2020, the total GDP of the five countries amounted to 25 percent of the global GDP ($21 trillion), and the share in international trade stood at almost 20 percent ($6.7 trillion). Particularly important is the fact that mutual exports of our five countries has grown by 45 percent over the past five years.
This trend will continue into the future regardless of the global coronavirus crisis, which is corroborated by the ongoing development of the strategic BRICS partnership during Russia’s current chairmanship. The organisation has reaffirmed its ability to respond flexibly to the changing international situation. Through joint efforts, we have preserved the continuity and stability of all areas of our cooperation. Over 150 joint events will take place throughout the year, albeit many of them online.
The New Development Bank (NDB) is working at its fullest. Approximately 60 projects in our countries totaling about US $20 billion have been approved. The NDB has responded to the pandemic in a timely and effective manner and announced the creation of a special lending mechanism to deal with the aftereffects of the coronavirus infection. In total, $4 billion have already been allocated for projects to assist in the recovery of the BRICS economies, with the entire aid package potentially reaching $10 billion.
Notably, the first Russian COVID-19 vaccine “Sputnik V” was recently registered. Russian researchers have developed medicines against the coronavirus infection. We are ready to share our experience with other countries, including our BRICS friends.
Relying on our partners’ support, we plan to approach the end of Russia’s BRICS chairmanship with a strong set of new agreements, including the already agreed upon BRICS Anti-Terrorism Strategy and the updated Strategy for Economic Partnership to 2025. A number of initiatives advanced by our chairmanship to strengthen sector-specific cooperation between BRICS members are at the final stages of development. The people-to-people and cultural ties, as well as contacts between experts and civil society representatives are expanding.
Importantly, BRICS and all of our countries are invariably open to interaction with constructively-minded partners. Our association has become a centre of attraction for many participants in international relations, primarily from among the developing economies and emerging markets.
I’m convinced that BRICS can and should take an active part in shaping the global architecture in the post-coronavirus world.
Today, we will discuss the interaction of the BRICS countries on important issues on the international agenda, as well as the expected results of Russia’s BRICS chairmanship in 2020.
Read Foreign Minister Sergey Lavrov’s remarks and answers to media questions at a news conference following the meeting.
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Covid wave brings second quarter slide (The Mail & Guardian)
South Africans should brace themselves for a further slump in the economy, as gross domestic product (GDP) numbers for the second quarter of the year are expected to plummet. Statistics South Africa is due to release the GDP numbers on Tuesday. The Covid-19 lockdown slowed the economy to a point where businesses across all sectors are operating below capacity. “The only bright spot that we are anticipating in the second quarter numbers is going to come from the agricultural sector because it was one of the few sectors that were permitted.
See also: The SA Daily – Deep damage to 2Q GDP (Standard Bank Research)
Ethiopian in Talks With South African Flag Carrier on Rescue (Bloomberg.com)
Ethiopian Airlines Group is among companies in talks with South Africa’s government about potentially offering support to the country’s insolvent state airline, according to people familiar with the matter. Africa’s biggest carrier is considering ways to help bankrupt South African Airways fly again after more than five months of dormancy, said the people, who asked not to be identified as the talks are private.
South Africa needs to raise more than 10 billion rand ($595 million) to revive SAA, according to a rescue plan compiled by administrators and backed by both the state and labor groups. Yet Finance Minister Tito Mboweni has said the funds should come from private sources, committing only to help “mobilize” the required amount. SAA was placed under administrative protection in December, before the coronavirus crisis hit.
Traders livid as KPA offers transit goods free storage (Nation)
KPA in a Friday notice extended goods free storage time it had announced in May by another 90 days but still left out domestic importers who have four days to clear them or risk hefty penalties. The move is viewed by many stakeholders as favouring goods destined to neighbours such as Uganda essentially making them cheaper. “Kenya Ports Authority wishes to announce to the general public of extension of free storage period to its customers. This is in line with our continuous and deliberate efforts of cushioning our customers on effects of the coronavirus, which have impacted the whole transport logistics chain,” Mr Salim wrote in the notice.
External trade rebounds on easing global restrictions (Business Daily)
Kenya’s expenditure on imports in July rose 14 per cent month-on-month to Sh138.76 billion, signalling increased trade activity in the economy as countries continue to ease measures put in place to reduce the spread of Covid-19. Data from the Kenya National Bureau of Statistics (KNBS) also reveals a continuous increase in the country’s export earnings to Sh52 billion in July from a low of Sh43 billion April. The country’s import bill fell to a low of Sh108 billion in May as a result of the pandemic. Consequently, due to the lower imports in the April to June period, the trade deficit for the first seven months of 2020 narrowed by 19.5 per cent to Sh546 billion from Sh678.9 billion reported over a similar period last year.
Strike deal on revenue formula urgently, senators told (The Star)
ANC party leader Musalia Mudavadi has urged senators to reach a consensus on the revenue-sharing formula. There is a public outcry of despair and governors are now threatening a shutdown,” he said. Mudavadi asked senators to put aside their personal and political differences and break the deadlock on the already overdue third-generation formula.
Poultry farmers scale down operation due to dumping claims (The Standard)
Over 540,000 broiler farmers in the country have been forced to scale down their operation, over alleged dumping of processed chicken by Uganda farmers. The farmers through their lobby group added that lockdown has further affected their market due to the sale restriction of eateries and fast food joints that operate twenty-four hours, seven days in a week.
URA registers sh179b revenue surplus in July (New Vision)
The Uganda Revenue Authority (URA) has registered a revenue collection surplus of sh179b in July 2020 in excess of target. According to the July 2020 Performance of the Economy report released by the finance ministry, the economy has started recovering from the COVID-19 induced economic crisis. URA registered revenue collections of sh1.52 trillion against a target of sh1.49 trillion. Out of the total revenue collections for July, sh1,146b was tax revenue, while sh55.5b was from non-tax revenue.
Foreign airlines record 30 per cent in slow restart (The Guardian Nigeria)
A 30 percent passenger traffic was recorded weekend in Nigeria’s international travel as commercial flight services resume after five months of lockdown. Flight resumption saw the arrival of only two flights at the Murtala Muhammed International Airport (MMIA), Lagos, in two days. The Guardian learnt the Federal Government would soon review the COVID-19 travel protocols towards increasing the number of frequencies and maximum number of passengers allowed at Lagos and Abuja airports daily.
Revving up diversification to overcome post COVID-19 challenges (The Guardian Nigeria)
The impact of COVID-19 in Africa has created a sense of urgency and inspired calls for coordinated response to mitigate it’s devastating effects and lay the foundation for long-term recovery. The economic impact of COVID-19 has been projected to be profound, especially with the fall in the price of crude oil (which has greatly affected the government’s revenue) and the general downturn in major sectors of the economy. Economists at the weekend submitted that diversification both of revenue and gross domestic product (GDP) is critical in a post-COVID-19 era given the volatility of the oil market. They said that despite the emphasis on leveraging the non-oil export particularly the real sector to diversify the economy, earn foreign exchange and create jobs, the implementation of the diversification agenda has continued to suffer setbacks.
Reform: Nigeria is fighting multiple challenges along with COVID-19 – Presidency (Vanguard)
Malam Garba Shehu, the President’s Senior Special Assistant on Media and Publicity has stated that in these trying times, Nigeria is fighting multiple challenges along with COVID-19. The presidential aide stated this in a statement in Abuja on Sunday while reacting to comments on the Buhari administration following an upward review of the pump price of fuel and electricity tariffs in the country. He said: “To stop the mismanagement of taxpayers money, eliminate corruption associated with subsidies on petroleum products, power, fertilizer among others, the administration took the decision to implement long-delayed reforms, withdraw and allow the market to determine their prices.
Egypt keen to enhance regional, international cooperation for industrial integration: Trade Minister
She delivered a speech on behalf of Egypt’s President Abdel Fattah Al-Sisi during the conference, held under the slogan “Glocalisation: Towards Inclusive and Sustainable Global Value Chains”. Gamea indicated that the Egyptian government has undertaken significant efforts to enhance industrial cooperation with many African countries, to implement joint industrial development programmes and projects Gamea pointed out that the manufacturing sector is foremost in importance among Egypt’s industrial sectors targeted by development plans, due to the pivotal role it plays in creating new added value. It can also be used to open the way for the basic industry products to be used in new manufacturing processes.
Regional and continental news
The Unfinished Agenda of Financing Africa’s COVID-19 Response (Project Syndicate)
The continent’s pandemic-response funding gap is likely to amount to some $100 billion annually over the next three years. So far, the African Development Bank, the IMF, and the World Bank have disbursed about $60 billion to Africa. But, in order to frontload support for developing economies over the next two years, they will need to expand their capital base significantly. That is why we are calling for a new replenishment round for the World Bank’s International Development Association, and additional resources for other multilateral development banks and the IMF.
The simple fact is that some countries are far better equipped to respond to the COVID-19 pandemic than others, and in a deeply interconnected global economy, no one can escape this crisis alone. The international community – especially the G7, the G20, and multilateral development banks – must take bold, innovative, and expeditious action to close it.
Authors: Brahima Coulibaly, Ngozi Okonjo-Iweala, and Vera Songwe
Covid-19 lockdowns in Sadc spawn massive smuggling (The Zimbabwe Independent)
Regional revenue authorities have established collaborative partnerships to combat the proliferation of smuggled goods in the wake of Covid-19 transborder restrictions. Information collected from revenue authorities from five countries suggests that illicit trade, mostly in consumables like alcohol, cigarettes and groceries, has boomed in the five months that regional states imposed lockdowns restricting cross-border movements to contain the spread of the coronavirus. This has, however, opened floodgates for illicit trading across the region’s porous borders. This is enabled by the fact that Sadc countries are highly dependent on each other for goods and services given their interconnectedness.
Slow out of the Blocks: Only two SADC states put their money where their mouths are on COVI-19 vaccine (The Southern Times)
Botswana, Mauritius, Seychelles and South Africa – all SADC member states – are the only African countries that have actively entered the race to secure doses of potential COVID-19 vaccines. Of these, just Botswana and South Africa have committed money for purchase of vaccines via a global network that is pooling resources to assist less developed nations secure medication for their citizens.
Buhari attends ECOWAS Summit in Niger Republic, submits Report on COVID-19 (Vanguard News)
President Muhammadu Buhari will depart Abuja on Monday for Niamey, Niger Republic to participate in the 57th Ordinary Session of the ECOWAS Authority of Heads of State and Government. The one-day summit, according to the President’s spokesman, Malam Garba Shehu, in a statement in Abuja on Sunday will deliberate on the Special Report on COVID-19 to be presented by President Buhari. “The President of the ECOWAS Commission, Jean Claude Kassi Brou will present to the West African leaders, the 2020 Interim Report on activities of the sub-regional body including ECOWAS Vision 2050.
“Capturing the demographic dividend in West Africa is essential for improving the living conditions of our populations through sustainable development and the structural transformation of our economies,” said Ngone Diop. “I encourage my colleagues to familiarise themselves with the handbook for measuring the generational economy, published in 2013 by the United Nations. It will be very useful to us for the achievement of our vision of creating and strengthening our niche, which is to invest in the demographic economics approach”, continued Ngone Diop.
AU-backed app seeks to speed up border re-openings (TechCentral)
Two major African public bodies are promoting a new technology that could connect the continent’s Covid-19 testing centres and ease a re-opening of travel across the region. The African Union and the Africa Centres for Disease Control and Prevention are encouraging member states to integrate the mobile-based PanaBIOS platform that would allow results from facilities across the continent to be centralised. So far, only Ghana is using the service. “Ghana is being used as the pioneer,” the West African country’s communication minister, Ursula Owusu-Ekuful, said in the capital, Accra. “The learnings from the uptake of the app and the usage of the app will be shared with the Africa CDC and be applied by other African countries,” she said.
Covid-19 hits East African agri value chains (African Business Magazine)
With increased global food, financial and health crises plaguing the world, about 1.3 billion people are not able to access sufficient or nutritious food, and close to a billion people suffer from chronic hunger. As a result, many African countries have refocused attention on the agricultural sector, implementing policies that will enhance public and private sector investments, trade, and markets to promote food and nutrition security. Ultimately the goal is to create and grow businesses leading to economic transformation.
Rwanda to host the first virtual AGRF Summit 8-11 September 2020
In light of the COVID-19 pandemic, Hon. Dr. Gérardine Mukeshimana, Minister of Agriculture and Animal Resources Rwanda and Dr. Agnes Kalibata, President of AGRA on behalf of the Government of Rwanda and AGRF partners, announced today at a virtual press briefing that the Tenth Annual AGRF Summit will be held virtually between 8-11 September 2020. The AGRF Summit, which brings together over 2000 delegates from governments, the civil society, the private sector, research community and development partners will be held, under the theme: “Feed the Cities, Grow the Continent – Leveraging Urban Food Markets to Achieve Sustainable Food Systems in Africa.”
‘I don’t understand why Africa is still hungry’: UN envoy’s plan to transform food systems for all (UN News)
Food systems involve all the stages that lead up to the point when we consume food, including the way it is produced, transported, and sold. Launching a policy brief on food security in June, UN chief António Guterres warned of an “impending food emergency”, unless immediate action is taken. The main impetus behind the Food Summit is the fact that the we are off track with all of the Sustainable Development Goals (SDGs) that relate to food systems, principally ending poverty and hunger, and action on the climate and environment. We want to use the Summit to galvanise and engage people, raising awareness about the elements that are broken, and what we need to change; to recognize that we’re way off track with the SDGs, and raise our ambitions; and to secure firm commitments to actions that will transform our current food systems for the better.
Private sector needs to play its part as 2021 debt deadline looms (The Africa Report)
Amidst the COVID-19 crisis, creditor countries are working on the next steps in dealing with African debt burdens. This time, however, they insist that the private sector will have to get involved. “To date, 28 countries, including 20 in sub-Saharan Africa, are benefitting from the Debt Service Suspension Initiative (DSSI) set up by the Paris Club, for a cumulative amount of $2.1bn, and 11 other applications are still being processed,” said the president of the informal organisation, Odile Renaud-Basso, director of the French Treasury, on 1 September. At the same time, according to data from the G20 group of developed countries on 18 July – the latest to date – 42 governments had made a similar request to this organisation, for a total of $5.3bn.
Global news
Media statement: Meeting of the BRICS Ministers of Foreign Affairs / International Relations - 4 September 2020 (Ministério das Relações Exteriores)
The Ministers exchanged views on major international and regional issues in the political, security, economic, trade, financial and sustainable development spheres, as well as reviewed the progress in intra-BRICS activities.
The Ministers acknowledged the Joint Statement by BRICS Trade Ministers on Multilateral Trading System and the WTO Reform on 23 July 2020 and reaffirmed their support for a transparent, open, inclusive and non-discriminatory rules-based multilateral trading system, as embodied in the WTO. They reiterated the importance of WTO reform and emphasized the central role of the WTO in promoting predictability, stability and legal certainty for international trade. They underlined the importance of all WTO Members abiding by WTO rules and complying with their commitments, thus avoiding unilateral and protectionist measures, which run counter to the spirit and the rules of the WTO. The Ministers stressed the urgency of ensuring the restoration and preservation of the normal functioning of the WTO Dispute Settlement System. They noted also the importance of adopting trade facilitation measures to promote trade relations among BRICS countries.
Angolan president defends “Marshall Plan” for Africa (ANGOP)
The Angolan Head of State took this standing when he was participating, by videoconference, in the Third Edition of the Global Manufacturing and Industrialisation Summit. The statesman noted that “Africa is one of the continents with the world’s greatest reserves of natural resources such as water from rivers and lakes, arable land, forests and abundant mineral resources, including some rare and strategic ones, but it is nevertheless, paradoxically, the least developed continent in economic, industrial and technological terms”. President João Lourenço stressed that Africa’s economic, industrial and technological development would depend on a serious commitment to the massive training of qualified staff in the most different branches of knowledge.
The US Versus Chinese Investment In Africa (Forbes)
The United States recently launched negotiations with Kenya for a free trade agreement. The talks are quite a turnaround. From its onset, the Trump administration has been averse to new commerce initiatives with the continent.
Efforts renewed, the US building closer relationships with African countries can be a vital economic lifeline especially during times of financial instability and uncertainty; Covid-19 being the clearest example. China’s relationship with its African partners is complicated, but will hopefully serve as a significant example in the future as the pandemic subsides. China’s flagship global development strategy, the Belt and Road Initiative (BRI), has led to $1 trillion spent in roughly 70 countries. Despite Covid-19, the US-China trade war, the Hong Kong security law, and a decline in global trade, China’s relationship with Africa can help soften the economic blows.
Cross-border mobility, Covid-19 and global trade (The Financial Express BD)
International trade and investment have always relied on the cross-border mobility of individuals. Transporting goods across borders involves humans, and will do so for the foreseeable future despite important technological advances. In addition, face-to-face contact continues to play a critical role in addressing some of the information and transaction costs involved in trading goods internationally.
This note will begin with a brief presentation of the mobility-related measures implemented by WTO members. It then offers an overview of their trade impact and outlines how governments have, in a second-phase response to the pandemic, fine-tuned their policies. It concludes by discussing possible international cooperative paths to build trade resilience for the future.
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National news
Pace of reform to determine shape of SA’s capital-equipment export recovery (Engineering News)
About 40% of capital equipment exported from South Africa has been affected by the lockdowns and restrictions on movement because of Covid-19, while capital equipment manufacturers have reported 30% to 40% lower turnover during June and July, says industry body and public-private partnership agency South African Capital Equipment Export Council (SACEEC) director and CEO Eric Bruggeman.
“Exports enable companies to link to other markets and different growth trajectories, while supporting local manufacturing, labour and commerce. There is significant potential to tap into regional and international trade to bolster the growth of local companies. “However, exporting requires stability in the country of manufacture and a consistent presence of companies in export markets. This is where government’s role is vital – to ensure that the trade environment is conducive to long-term trade, such as enabling the movement of skilled people, goods and finances between South Africa and the countries to which local companies export.”
South Africa’s tax policies viewed through the prism of Covid-19 (Moneyweb)
South Africa is attempting to paddle in a big pond. But with the degree of corruption and lack of capacity to bring its tax criminals to book – not to mention the fiscal hole created by government policies that have hampered trade and had a knock-on impact on excise duties and other taxes collected – how can it discuss tax policy reform in isolation?
Taxpayers note tax audit process improvement – PwC survey (Engineering News)
South Africa’s tax administration system has undergone significant change in terms of leadership, structure and policy over the past two years, professional services firm PwC reports. It notes that, more recently, the government has introduced several economic measures, including tax measures to protect businesses and vulnerable employees during the Covid-19 lockdown period and after the lockdown has been lifted. It notes that, added to this, companies are seeing an increase in tax audits and disputes and that all signs point to even more intense focus by the tax authorities in the future.
Electronic tariff platform goes live in Eswatini (World Customs Organisation)
On 1 September 2020, the Eswatini Revenue Authority (SRA) held an inauguration ceremony to announce the official launch of a national electronic tariff platform. In his opening remarks, Honorable Minister Mancoba Khumalo recalled that Eswatini had ratified the WTO Trade Facilitation Agreement as early as 2017 and was committed to the full implementation of the standards enshrined therein. He stressed that the online tariff platform will complement that important endeavour, emphasizing the particular relevance of online tools for the ongoing digitalization of Customs processes.
Zimbabwe Corn Deliveries Soar on Improved Payments to Farmers (Bloomberg.com)
Corn deliveries by Zimbabwean farmers have soared thanks to more speedy payments, boosting supplies of the scarce staple, according to the country’s Grain Marketing Board. “Farmers are now able to use their money on time before it’s eroded by inflation,” Mutenha said. “We have also increased our collection points to reduce the traveling distance for farmers.” The southern African nation’s grain stockpile has dwindled amid a prolonged drought, recession and soaring inflation, while a chronic shortage of foreign currency has limited the government’s ability to import food. The World Food Programme estimates 8.6 million Zimbabweans, or 60% of the population, will be food insecure by the end of this year.
FG approves $3.1 billion for automation of Customs, targets $176 billion revenue (Nairametrics)
The Federal Government has approved $3.1 billion for the automation of the operations of the Nigerian Customs Service (NCS). The main objective is to completely automate every aspect of the customs business and institutionalize the use of smart and emerging technologies to boost the statutory function of the Nigerian Customs Service in the area of revenue generation.
Morocco’s trade deficit eases by 18.2% in July (The North Africa Post)
Morocco’s trade deficit in the first seven months this year eased by 18.2% as foreign demand on Moroccan industrial exports curbs imports, the foreign exchange office said. The office also cited a significant drop in energy imports triggered by lower prices in international markets. By July, Morocco’s energy imports slid 31, while equipment purchases dropped 18%.
Removing impediments to export-led growth in Senegal: Groundnuts, fishing, textiles, fruits, and vegetables (Brookings)
Senegal has a lot going for it: Its stable democracy, great irrigation potential, religious tolerance, and proximity to markets in Europe and North America all suggest the West African country is poised to take off. Yet, economic performance since independence in 1960 has been disappointing. In fact, Senegal’s exports have grown much more slowly than global trade and have become increasingly capital-intensive, while its trade deficit has steadily worsened. To understand this paradox, recent research has focused on the impediments holding back specific industries where Senegal has comparative advantage – fishing and groundnuts, fruits and vegetables, and textiles.
Pathways to structural transformation of the Ghanaian economy – and some roadblocks (Brookings)
While Ghana’s economic growth over the last decade has been comparatively strong – annual economic growth averaged approximately 6.8 percent for the period 2010-2019 – this growth has largely been driven by minerals and crude oil production rather than by the manufacturing sector, which has a higher propensity to create more jobs. One particular bottleneck for Ghanaian firms seeking to increase production and diversify into knowledge-intensive products is inefficiency at ports and transit points within the Economic Community of West African States (ECOWAS) region.
Kenya initiates talks to solve Uganda border cargo stalemate (The Star)
Kenya through the EAC ministry has initiated diplomatic talks to solve the cargo standoff at the Busia and Malaba borders. The move follows reports that the Ugandan government has issued new directives requiring all truck drivers entering the country through Busia and Malaba to undergo another Covid-19 test irrespective of whether they possess another from Kenya. Effective September 1, truck drivers have to part with $65 (Sh7,039) to get tested for Covid-19, a move that will push up the already high cost of transport and doing business in the region. The Ugandan government has reversed its earlier decision for free testing of truck drivers and facilitation of the movement of goods.
Uganda Harmonizing Cocoa Standards to Facilitate Trade in EAC (ChimpReports)
Uganda Coffee Development Authority (UCDA) in collaboration with Uganda National Bureau of Standards (UNBS) hosted the national expert technical committee to discuss and draft the East African Standards for Cocoa and related products. “The reason for harmonization of standards is to promote uniformity across the EAC. This will make it easy for Uganda to trade in cocoa and related products within the EAC partner states and outside the East Africa region. In addition, the standardization will ensure that cocoa and its products are safe for consumption,” said Ms. Pamela Akwap, UNBS Senior Standards Officer.
Regional and continental news
EAC urged to collaborate, drive region’s trade (The Star)
There is need for deeper collaborations between the public and private sector to boost intra-EAC trade and investment, industry players have said, as the region wades through Covid-19 effects on economies. During a consultative CEOs roundtable meeting organized by the East African Business Council (EABC) in collaboration with GIZ, in Arusha, the industry captains noted that the region's economies are interdependent hence need close collaboration. Dubbed 'Creating Perspectives Project', the Thursday forum brought together company chief executives in Arusha, with the aim of deliberating on approaches that the private sector can explore to revamp their businesses amid the pandemic.
During the meeting, EABC CEO, Peter Mathuki called upon businesses to re-purpose their business models to tap into the new emerging opportunities such as e-commerce, digital technology and biotechnology. “Innovation, value addition, embracing our local content and tapping into our regional supply value chains are some of the imperative solutions that will drive us towards economic growth,” he said.
ECOWAS holds regional sensitisation workshop on AfCFTA for organised private sector
The Economic Community of West African States (ECOWAS) in collaboration with the Organised Private Sector, held a virtual regional sensitisation workshop on the African Continental Free Trade Area (AfCFTA) for the Private Sector on Wednesday, September 2, 2020. Mr. Mamadou Traore noted that to achieve the success and implementation of the AfCFTA, Member States/Regional Economic Communities (RECs) must actively engage with the private sector and allow members of the sector to share their reflections and on-ground experiences. The President of the Federation of West Africa Chambers of Commerce and Industry (FEWACCI), Hajia Saratu Aliyu, observed that the private sector actors are the actual traders and investors responsible for moving goods and services across borders and pledged their commitment to supporting the regional AfCFTA negotiation and implementation mechanisms.
Ministerial Statement on the Impact of COVID-19 on People on the Move in the IGAD Region
The Ministers for Internal Security and Ministers in charge of Migration Issues of the Member States of the Inter-Governmental Authority on Development (IGAD) held a virtual ministerial meeting on 2 September 2020 with representatives from international organizations working on migration and displacement.
“After considering the report of the deliberations of the High Level Meeting of Experts and recommendations therein, we hereby solemnly declare to: Enhance cooperation and coordination with the countries of destination and transit, as well as relevant agencies and partners, to guarantee the immediate provision of humanitarian assistance, and facilitation of safe and urgent release, return and reintegration; Promote inclusive public health and socio-economic response and recovery strategies that integrate the protection of and assistance needs for people on the move;...”
Private sector acquires a taste for African power (African Business Magazine)
Over recent years, private investors have started to scale up their involvement in the sector. Power Africa, an initiative backed by USAID, has more than $54bn of commitments from its more than 140 private sector partners. The need for private investment will grow even more acute in light of the coronavirus pandemic’s impact on the continent. From the perspective of Africa Infrastructure Investment Managers (AIIM), which manages $1.9bn of investments in 19 countries across the continent, the outlook for investment remains nuanced and varied between countries. If African economies are to make the most of the opportunities, they will need to continue to double down on reform.
African Continental Qualifications Framework (ACQF) mapping study reports (AUDA-NEPAD)
The African Continental Qualifications Framework (ACQF) is a vital policy initiative of the African Union, aimed to enhance transparency and portability of qualifications of all sub-systems and levels of education and training, to align with national and regional qualifications frameworks and finally to contribute to CESA 2025 and the continental integration agenda of AfCFTA. The ACQF is in development (2019-2022), in a process supported by the EU, GIZ and ETF. To build on a well-grounded evidence base, the AQCF process started with a continental mapping study exploring the state-of-pay and perspectives of qualifications frameworks and systems. A collection of national and REC reports has emerged, useful for reference and sharing among peer institutions and stakeholders.
Gender should be central to Africa’s COVID-19 economic recovery initiatives (UNECA)
Unless a gender perspective is embraced in COVID-19 recovery initiatives, the ongoing global health pandemic will amplify existing gender disparities leading to worse outcomes for women in terms of livelihoods and well-being. This was said Thursday by Ms. Thokozile Ruzvidzo, Director of the Gender, Poverty and Social Policy Division at the Economic Commission for Africa (ECA), in remarks made during a Gender is My Campaign, (GIMAC) online campaign on the gendered effects of the coronavirus pandemic. “Women in African countries are in general concentrated in necessity-driven entrepreneurship in the services sector, market activities and cross-border trade in the informal economy. It is expected that the knock-on effects of border closures and market restrictions to deal with COVID-19 will be significant,” she said.
Global news
We write to convey our deep concern regarding proposed changes to the US Generalized System of Preferences program (GSP) which threaten to vitiate key provisions of the African Growth and Opportunity Act (Agoa), the genuinely bipartisan measure that for the past 20 years has been the cornerstone of US economic engagement with the nations of Africa. If adopted when GSP is renewed, as it needs to be by the end of the year, these changes would cause gratuitous hardship in a region already reeling from the impact of COVID-19.
The encouraging Agoa-stimulated trends we have seen in African supply capacity and exports to the US will be reversed, threatening to push millions back into poverty, the majority of them women, as the continent grapples with the human and economic toll of the novel coronavirus. And the damage will not be restricted to Africa. The pain will be felt by our hemispheric neighbors as well.
G20 Foreign Ministers to strengthen international cooperation in response to the COVID-19 pandemic
The G20 Foreign Ministers held an extraordinary meeting to discuss enhancing international cooperation to recover from the impacts of COVID-19 pandemic as well as strengthening preparedness for future pandemics. His Highness Prince Faisal bin Farhan Foreign Minister stated that “Reopening borders, in accordance with all the protective measures and national regulations, will help our economies to thrive, people to prosper, and will of course bring hope for humanity to have faith in cooperating to overcome the pandemic.”
How can we build supply chains fit for an uncertain future? (World Economic Forum)
Seven months into the COVID-19 pandemic, businesses of all kinds are devising ways to protect themselves from future shocks by making their supply chains more resilient. We have seen protectionism intensify. Some emergency moves are clearly temporary. They were put in place by governments to ensure access to the medicines, machines and protective equipment required to contain or treat the virus. In other cases, the aim was to guarantee adequate food supplies for local populations. As economies around the world emerge, unevenly, from the pandemic, we can expect demand to begin to strengthen. As it does, trade flows, carrier schedules and inventory levels will start to normalize, and supply and demand will find a new equilibrium.
UK sees just 30%-40% chance of Brexit trade deal – The Times (Reuters)
Senior officials in British Prime Minister Boris Johnson’s office see only a 30%-40% chance that there will be a Brexit trade agreement with the European Union due to an impasse over state aid rules, The Times reported. “Inside No 10, they now think there is only a 30 to 40 per cent chance that there will be an agreement,” James Forsyth, political editor of The Spectator, wrote in a column. “The sticking point isn’t fish – I’m told that there is a ‘deal to be done’ there – but state aid.” Talks on the trade deal are due to resume in London next week.
New study shows benefits, limits of cash transfers (Devex)
Cash transfers to young people in Rwanda were more effective than a job training program in helping them build assets, increase savings, and improve productivity, according to a new study released Thursday. This latest research adds to the small but growing body of knowledge about cash benchmarking, or using the impact of cash as a baseline for program evaluation. “Cash benchmarking is the next revolution in how we get more rigorous about doing more good than handing over budgets and letting people spend it,” GiveDirectly Managing Director Joe Huston said.
COVID-19 will widen poverty gap between women and men, new UN Women and UNDP data shows
The COVID-19 crisis will dramatically increase the poverty rate for women and widen the gap between men and women who live in poverty, according to new data released today by UN Women and the United Nations Development Programme (UNDP). “Women are bearing the brunt of the COVID-19 crisis as they are more likely to lose their source of income and less likely to be covered by social protection measures. Investing in reducing gender inequality is not only smart and affordable, but also an urgent choice that governments can make to reverse the impact of the pandemic on poverty reduction,” said Achim Steiner, UNDP Administrator.
UN Secretary-General António Guterres has called on governments to incorporate “meaningful” climate action in all aspects of recovery from the global pandemic. Addressing ministers at a virtual meeting on sustainable recovery from COVID-19 on Thursday, the UN chief said that the world is confronting two urgent crises: COVID-19 and climate change. The Secretary-General outlined six climate-positive actions for a sustainable recovery, including investing in green jobs; not bailing out polluting industries; ending fossil fuel subsidies; accounting for climate risk in all financial and policy decisions; working together; and – most important – leaving no one behind.
Global food prices rise in August (Food and Agriculture Organization)
Global food prices rose for the third consecutive month in August, influenced by generally firmer demand and a weaker U.S. dollar, according to a report released today by the Food and Agriculture Organization of the United Nations. The FAO Food Price Index, which tracks the international prices of the most commonly traded food commodities, averaged 96.1 points in August, up 2.0 percent from the previous month and reaching its highest level since February 2020.
Related News
G20 Foreign Ministers to strengthen international cooperation in response to the COVID-19 pandemic
The G20 Foreign Ministers held an extraordinary meeting to discuss enhancing international cooperation to recover from the impacts of COVID-19 pandemic as well as strengthening preparedness for future pandemics.
The ministers and representatives of international organizations discussed the importance of coordinating precautionary measures on cross-border management to protect lives and livelihoods.
During the meeting, foreign ministers acknowledged the importance of opening borders, uniting families, and promoting measures to allow the economy to thrive in light of the protective measures given by health organizations and national regulation during the COVID-19 pandemic.
The ministers expressed their deep condolences for the huge loss of human life and tragic impacts caused by COVID-19 and acknowledged the efforts and commitment of frontline workers to public health and safety.
His Highness Prince Faisal bin Farhan Foreign Minister stated that “Reopening borders, in accordance with all the protective measures and national regulations, will help our economies to thrive, people to prosper, and will of course bring hope for humanity to have faith in cooperating to overcome the pandemic.”
Selected statements from the meeting are included below.
Prince Faisal bin Farhan, Minister of Foreign Affairs, Kingdom of Saudi Arabia
I thank you all for coming together today, and for all of your ongoing efforts during this severe health crisis and the economic and social impacts that have come from it.
Before I begin, allow me to express condolences for the loss of life and the suffering faced by people around the world and to give my deepest gratitude to the frontline health workers.
In 2008, G20 Leaders met to tackle what then was the greatest economic and financial crisis in over 50 years.
We find ourselves in an even more complex and challenging situation today as our governments tackle the intertwined effects of a global health and economic crisis.
As the chair of the G20 Presidency, the Kingdom of Saudi Arabia called for An extraordinary summit on March 26th, in which the G20 Leaders committed to supporting the international efforts to counter the pandemic, safeguard the global economy and enhance global cooperation.
The pandemic is a global challenge that requires an effective and coordinated global response.
The subsequent work that came from our leader’s commitments is ongoing and we have already seen great strides as G20 countries’ significant contributions of $21 billion to close the financing gap to support international efforts to fight the pandemic.
The G20 is focused on addressing economic and development issues and as foreign ministers; we typically play a supporting role to the work being done on those important issues.
But as our leaders stated in their extraordinary statement, the virus respects no borders and that has meant that cooperation among states is more important than ever.
COVID-19 has led us all to restrict our borders as we continue to coordinate with the relevant health authorities and assess the health situation on a national and global scale.
We all had to deal with the challenge of bringing home our citizens who were stranded by the global travel restrictions and it was gratifying to see the spirit of cooperation and support with which the global community responded. In that regard, I would like to personally thank the 124 nations who were supportive in bringing back our Saudi citizen.
For that reason, we felt it would be valuable to come together in this forum to share experiences and best practices, as we look forward to an eventual easing of travel restriction and returning to normal lives.
Our meeting today will signal to the world that we care and have a unified focus on dealing with the crisis.
We look forward to the upcoming joint G20 Finance and Health ministers meeting and as foreign ministers, we will take any action required to facilitate the necessary measures agreed upon.
We are one world, and we are one community and we must work together to support each other through this crisis.
United Nations Secretary-General António Guterres
COVID-19 respects no borders – and that demands that we strengthen cooperation across our own.
The pandemic has forced unprecedented lockdowns, travel suspensions and limited movement across borders.
Concerns are growing that some of the current movement restrictions could outlast the immediate crisis.
Furthermore, the adoption of ad hoc measures could create a patchwork of unworkable travel requirements, creating significant obstacles to a global economic recovery.
As we work together to manage our way out, it is vital to move ahead in a coordinated way.
Your discussions today will be crucial – and let me quickly point to five focus areas that can help guide the way.
First, I urge the G20 to agree on common objective criteria in relation to the removal of travel restrictions, based on scientific evidence.
Second, to increase investments on systems and practices that support safe travel – in close coordination with the private sector.
Third, to boost coordination in preventive measures – in particular more systematic use of testing and tracing and other proven actions to avoid the spread of the virus and allow for effective control of the potential impacts of increased mobility.
Fourth, to ensure full respect for international human rights and refugee law.
Fifth, to agree that the future vaccines will be considered a global public good to be available and affordable everywhere, supporting global health, global mobility and global economic recovery.
All actions must recognize upholding human dignity as the guiding principle for cross-border policies.
Excellencies, in all we do, we need to advance an inclusive health, social and economic response to the crisis.
Let me be blunt. We still have a long way to ago in two crucial dimensions.
First, in our capacity to fight the pandemic together.
We have seen the results when each country pursues its own strategy, with the advice of the World Health Organization being largely disregarded.
When countries go in different directions, the virus goes in every direction.
Second, we still lack effective international solidarity to respond to the economic and social impacts and the underlying fragilities exposed by the pandemic.
From the beginning, the United Nations has called for massive global support for the most vulnerable people and countries.
Developed countries have done so for their own economies – but we need mechanisms of solidarity to ensure that the developing world will also fully benefit.
This includes boosting the resources available to international financial institutions and doing far more to address the escalating debt crisis, which is devastating public balance sheets and hampering crisis response and recovery.
Solutions to the debt emergency must include an extension of the Debt Service Suspension Initiative to at least the end of 2021, a broadening of its scope to all vulnerable countries, as well as comprehensive debt relief for some countries in need.
We must leverage cross-border capital flows for the crisis response by safeguarding global liquidity, reducing the cost of remittances and combatting illicit financial flows.
Recovering better also requires addressing deep-seated inequalities, including with regards to gender.
More than ever, we need effective international solidarity – and concerted G20 action – to advance these priority areas and build a more inclusive, resilient and sustainable world for all.
Thank you.
World Bank Group President David Malpass
Good morning, Foreign Minister Faisal, and to all.
The COVID-19 pandemic has hit developing countries particularly hard due to capital outflows, declines in remittances, the collapse of informal labor markets and very limited social safety nets.
Poverty is rising rapidly, median incomes are falling, and growth is deeply negative. Debt burdens were already unsustainable for many countries and are rising to crisis levels. Children everywhere are out of school. Earlier this week, I joined the UN Secretary-General in an event on digital connectivity for education. World Bank programs are working to help leaders restart learning – by providing COVID-19-related equipment to make schools safer, helping reopen schools, and through support for more effective distance learning.
The pandemic threatens to push over 100 million people into extreme poverty and is exacerbating intense inequality throughout the world. The World Bank Group launched its first operations in April and took fast, broad action on COVID-19, quickly creating specific financing programs in over 100 countries. We are committed to financing access and distribution of vaccines for our clients and to working with GAVI, CEPI and the international community.
We’re committed to continue providing a very large net positive flow to developing countries during the next year. To increase fiscal space and create light at the end of the tunnel for the world’s poor, we have called for debt stock relief where appropriate. We welcomed the G20’s endorsement of a suspension of debt payments for the world’s poorest countries; are urging the G20 to extend the moratorium through 2021; and believe the reduction in the stock of debt needs to be high on the international agenda. The current environment of very low interest rates and bond yields, combined with an imbalance in the global system that favors wealthy creditors over the world’s poor, is a recipe for waves of excessive debt burdens for the world’s poorest countries. We need concrete steps to address the inequality and unfairness of the relationships that favor creditors. The lack of participation of commercial creditors in the debt moratorium has been very frustrating, reducing the effectiveness of the G20’s efforts.
Even so, we’ve made substantial progress in 2020 by publishing more information on debt, debt contracts, the collateral that has been restricted, and the non-disclosure clauses that burden sovereign contracts. We need to broaden the creditor information and participation, clarify the distinction between official and commercial creditors, and insist on comparable treatment by commercial creditors when official creditors provide relief. The moratorium itself has provided some fiscal space for participating countries, but much more needs to be done in order to achieve a more equitable outcome for people in developing countries.
I would also like to describe just two examples of our work in the most vulnerable populations, including refugees, where millions are facing a human catastrophe, including but not limited to COVID-19. Your decisions can make a huge difference. Security remains problematic due to deteriorating conditions around the world, and I urge you to address and resolve political problems where you can.
In Lebanon, this week, the World Bank Group released the Rapid Damage & Needs Assessment (RDNA), prepared in consultation with the EU and the UN. This assessment provides a framework for the incoming government to commit to implementing credible reforms that can unlock international financing and private investments. The World Bank has supported over US$3 billion worth of projects in Jordan and Lebanon to help both refugees and host communities. We have supported Lebanon by equipping governmental hospitals and increasing their ability to test and treat suspected cases, with focus on Syrian refugees.
In Sudan, we are combining resources from trust funds and – at the government’s request – we are designing an ambitious Cash Transfer program. We are also providing a maximum of US$400 million in a pre-arrears clearance grant and we are working closely with the government to get arrears clearance to pave the way for fresh financing from IFIs.
Those are two recent examples of our work, but in truth, COVID-19 has had a devastating impact in fragile and conflict-affected (FCV) countries and we are committed to protecting human capital, supporting the most vulnerable, and working toward a resilient recovery.
Thank you.
Related News
Make COVID recovery ‘a true turning point’ for people and planet, Guterres urges, calling for concerted action by G20
UN Secretary-General António Guterres has called on governments to incorporate “meaningful” climate action in all aspects of recovery from the global pandemic.
Addressing ministers at a virtual meeting on sustainable recovery from COVID-19 on Thursday, the UN chief said that the world is confronting two urgent crises: COVID-19 and climate change.
“Let us tackle both and leave future generations with the hope that this moment is a true turning point for people and planet,” he said, in a video message.
The ministerial meeting, convened by the Government of Japan, saw the participation of senior officials from several countries, as well as representatives from youth groups, civil society organizations, businesses and local governments.
In parallel, an online portal that showcases climate and environment policies and actions in recovery from COVID-19 was launched. The Platform for Redesign 2020 will help build momentum for COP26, the UN conference that assesses progress in dealing with climate change, to be held in 2021.
Renewables cheaper and more efficient
The Secretary-General outlined six climate-positive actions for a sustainable recovery, including investing in green jobs; not bailing out polluting industries; ending fossil fuel subsidies; accounting for climate risk in all financial and policy decisions; working together; and – most important – leaving no one behind.
Mr. Guterres spoke of governments and businesses shifting towards them, realizing that clean energy brings more jobs, cleaner air, better health and stronger economic growth.
“The world’s top investors – including some in Japan – are abandoning fossil fuels because renewables are cheaper and more efficient,” he continued, adding: “They understand that it makes no economic sense to burn money on coal plants that will soon become stranded assets.”
The UN chief also called on all countries, especially member of the G20 – the group of top industrialized nations – to commit to carbon neutrally before 2050. He urged them to submit “more ambitious” nationally determined contributions (NDCs) and long-term strategies before COP26 aligned with the goal to limit temperature increase to 1.5 degree Celsius.
Japan can be a world leader
Recognizing Japan’s technological development in many fields, the Secretary-General said the country can become a world leader on the sustainable and resilient recovery.
He called on Japan to stop investing in coal power plants and increase its share of renewables. “I sincerely hope Japan will end external financing of coal power plants, commit to carbon neutrality before 2050, set an early phase-out transition for domestic coal use and significantly increase the share of renewable energy,” said Mr. Guterres.
A window of opportunity
Also speaking at the meeting, Patricia Espinosa, UN Framework Convention on Climate Change (UNFCCC) Executive Secretary, said that the convergence of COVID-19 and the climate crisis has provided a window of opportunity, to not only recover from the pandemic but also to build a better future.
She called on governments to move away from new carbon intensive infrastructures. Doing so would help bring down emissions for decades to come.
“Preventing the spread of coronavirus has been the most effective approach to the pandemic, so preventing future emissions is the most effective approach to address climate change,” she said.
Highlighting the importance of a coordinated global effort, she urged everyone to “embrace the strength of multilateralism” to recover from COVID-19, make progress on climate change agenda, and build a more sustainable future.
Five-point agenda for G20
Speaking to an emergency meeting of G20 foreign ministers on the COVID crisis, Mr. Guterres noted the pandemic has forced “unprecedented lockdowns, travel suspensions and limited movement across borders,” adding that ”concerns are growing that some of the current movement restrictions could outlast the immediate crisis.”
He flagged “five focus areas” for the discussion, urging first that they seek agreement on common objective criteria in relation to the removal of travel restrictions, based on scientific evidence.
Second, the UN chief called for “investments on systems and practices that support safe travel – in close coordination with the private sector.
Thirdly, he called for better coordination in preventive measures – “in particular more systematic use of testing and tracing and other proven actions to avoid the spread of the virus and allow for effective control of the potential impacts of increased mobility.”
Next, he highlighted the importance of full respect for international human rights and refugee law, and also called for agreement that future vaccines will be considered a global public good to be “available and affordable everywhere, supporting global health, global mobility and global economic recovery.
“All actions must recognize upholding human dignity as the guiding principle for cross-border policies.”
One direction, together
He said there was “a long way to go” on two key fronts: “First, in our capacity to fight the pandemic together. We have seen the results when each country pursues its own strategy, with the advice of the World Health Organization (WHO) being largely disregarded. When countries go in different directions, the virus goes in every direction,” he added.
“Second, we still lack effective international solidarity to respond to the economic and social impacts and the underlying fragilities exposed by the pandemic.”
He said more than ever, effective international solidarity was key – “and concerted G20 action – to advance these priority areas and build a more inclusive, resilient and sustainable world for all.”