issue 413 | 15 Aug 2021
Africa / SingaporeAfrica-Singapore trade on the up and up in the last five years
Trade between Singapore and Africa has been growing at a compound annual growth rate of over 7.6% over the past five years, a senior official said recently. Singapore is among the top 10 investors in Africa, with over 100 Singaporean companies operating across 50 countries in oil and gas, consumer, digital, agri-business and trade sectors. Speaking at a virtual media briefing about the Singapore African Business Forum 2021 edition, Ms Linn Neo, regional director of Enterprise Singapore, said the forum would serve as a platform for holistic engagement between Singapore, Asia and Africa. She also said the forum, which is scheduled to take place from 23 – 27 August 2021, will raise awareness of Africa’s growth opportunities, and promote Singapore as a hub for Asia-Africa trade and investment, among other things. Ms Neo said Singapore had been a long-time development partner in Africa, and both have used their development models to influence manufacturing, sustainable infrastructure, innovations and technology across the continent.
Source: The Citizen
East AfricaBack to drawing board for EA domestic tax harmonisation
East African member states have retreated to the drawing board on the domestic tax harmonisation plan after failing to agree on the uniform tax rules and rates for the six-member economic bloc, casting doubts on the feasibility of several regional integration programmes. The East African Community (EAC) Secretariat said regional Finance ministers are set to meet next month to review the challenges met so far in the process of trying to harmonise value added tax (VAT), excise tax and income tax and set a new roadmap for implementation. “The ministers of Finance will be meeting in September to discuss this among other issues,” the secretariat’s secretary general, Peter Mathuki, told The EastAfrican. “They will review progress and challenges of implementation and develop a roadmap that will inform progress,” added Dr Mathuki. Kenya’s principal secretary in the State Department of EAC Affairs, Kevit Desai, said last-minute attempts are being made to save the process that is fast disintegrating. “This is an uphill task but we are leveraging capacity to salvage it. Kenya looks at it as easing doing business,” said Dr Desai.
Source: The EastAfrican
East AfricaEAC inks Joint Action Plan with India in readiness for Mutual Recognition Agreement to facilitate faster clearance times for accredited traders
Traders from the East African Community (EAC) stand to benefit from faster clearance of their goods and lower costs of running their business following the signing of a Joint Action Plan between the EAC and the Government of India. The Joint Action Plan will pave the way for a full Mutual Recognition Agreement (MRA) between the two parties. The MRA, once realised, will benefit companies under the Authorised Economic Operators (AEO) Programme run by the EAC partner states under the coordination of the EAC Secretariat since 2008. Speaking on behalf of the Government of India, the chairman of the Central Board of Indirect Taxes and Customs (CBIC), Mr Ajit Kumar, emphasised the crucial role of having in place a robust, safe and largely digitised system, on one hand, and a pool of trusted and validated trading entities on the other hand. The AEO programme is a concept derived from the World Customs Organization (WCO) SAFE Framework of Standards, an instrument that was adopted by the WCO Council in 2005 to enhance facilitation and security of global trade.
West AfricaECOWAS parliament moves to ensure energy efficiency in sub-region
The parliament of the Economic Community of West African States (ECOWAS) has moved to tackle the deficit of energy in the sub-region as the parliament’s Joint Committee on Energy and Mines, Industry and Private Sector, Agriculture, Environment and Natural Resources, and Infrastructure on 10 August, started a five-day delocalised meeting in Abidjan, Côte d'Ivoire. Under the theme, ‘Ensuring energy efficiency in West Africa with emphasis on active involvement of the private sector and citizen’s participation’, the regional legislature intends to mobilise resources to tackle the deficit. The objective of the meeting is to keep the sub-regional lawmakers informed on the community’s action in terms of energy efficiency and in the context of the persistence of the Coronavirus (COVID-19) pandemic, where experts in the industry would take the members of parliament through relevant topics related to energy efficiency in the sub-region. A statement from the communications division of the sub-regional parliament pointed out that, in view of its responsibility in the decision-making process of the community, the parliament has become aware of the challenges linked to the energy performance of the region.
BotswanaBotswana aspires to become exporter of electricity from 2027 – Official
From 2027, Botswana will become a net exporter of electricity, the Southern African country's mineral minister said on Wednesday, 11 August. Botswana launched an Integrated Resource Plan (IRP) in December 2020, which is viewed as the driving force behind Botswana's quest to meet local energy demand and be able to export excess electricity, said Lefoko Moagi, minister of Mineral Resources, Green Technology and Energy Security, when addressing the Southern African country's parliament on steps being taken to utilise clean energy resources optimally. The plan is a 20-year roadmap for power generation and takes on board different technologies for power generation, said Moagi. "From the beginning of the planning period of 2020, Botswana was relying on electricity imports and I believe that the expected increase in local generation from year 2024 will significantly reduce electricity import," he said. Over the period 2020-2040, Moagi said the plan has identified the implementation of at least two 50 megawatts solar photovoltaic (PV) projects as well as 12 grid-tied small solar PV projects in six different areas across the country.
BotswanaBotswana stock market on a decline
The Botswana Stock Exchange (BSE) has recorded a decline of more than 8% in equity turnover over the past year. As at the end of July 2021, a total equity turnover of BWP370.7-million (USD33.4-million) was recorded from traded volumes of 267 million shares compared to BWP405.3-million recorded from 174.9 million shares in 2020. This is the lowest half-year equity turnover since 2018 when BWP1.143-billion was recorded. Local companies contributed 65.5% to total equity turnover or BWP243-million in monetary terms while local individuals contributed 6.2% or BWP23.2-million in monetary terms during the period under review in 2021. Foreign companies contributed 22.1% or BWP82-million to total equity turnover while foreign individuals and brokers contributed 6% (BWP22.4-million). The value of bonds traded during the period under review was BWP979.7-million compared to BWP683.1-million traded during the same period in 2020. As at end of July 2021, the market capitalisation of listed bonds stood at BWP22.1-billion.
Source: CAJ News
Côte d'Ivoire / GhanaCôte d'Ivoire, Ghana agree to cooperate on cocoa pricing
Côte d'Ivoire and Ghana, the world's two largest cocoa suppliers, on Thursday, 5 August 2021 agreed to better cooperate on pricing and combatting child labour in the industry. Côte d'Ivoire accounts for more than 40% of world output, and Ghana at least 20%. More than half of their growers live below the poverty line. The two West African producers joined forces in 2019 to try to get more from the chocolate industry, obtaining a premium per tonne of cocoa. But the COVID-19 pandemic has hit global demand, and buyers are reluctant to see prices rise with a surplus in supplies. Ghana's Foreign Affairs minister, Shirley Ayorkor Botchway, said they had agreed to form a joint body to cooperate over research, price setting, and child labour. "The two countries which produce about 60% of the world’s cocoa have coordinated on some of those issues before, but this new organisation marks a formal step toward even more effective corporation," she said. The world's chocolate market is estimated to be worth more than USD100-billion, concentrated in a few multinational corporations.
GhanaGhana to partner German company to pilot electronic cash – Central bank
Ghana is to partner with a German technology company to start piloting its proposed electronic currency from September, the Bank of Ghana said on Wednesday, 11 August. The Bank of Ghana disclosed in a release that it had signed an agreement with Giesecke + Devrient, a German firm, to implement the pilot Central Bank Digital Currency (CBDC) project as a precursor to the issuance of a digital form of the national currency. "The German technology firm will provide the technology and develop the solution adapted to Ghana's requirements, and test this in a trial phase with banks, payment service providers, merchants, consumers, and other relevant stakeholders," said the release. It added that the digital Cedi would complement and serve as a digital alternative to the physical cash to drive the country's cash-lite agenda through promoting diverse digital payments to ensure a secure and robust payment infrastructure. The bank said the electronic currency would also facilitate payments without bank accounts, contracts, or smartphones "to boost the use of digital services and financial inclusion among all demographic groups." The Bank of Ghana and its technology partner will undertake the project in three phases of design, implementation and pilot, before a nationwide rollout.
KenyaParliament rejects Bill seeking to pay fallen bank depositors KES1-million
Parliament has rejected a proposed law that would have seen depositors in fallen banks paid up to KES1-million for every account in compensation. The National Assembly Committee on Finance and National Planning shot down the Bill amid concerns that nearly KES1-trillion would be needed to cover for the exposure. The Kenya Deposit Insurance (Amendment) Bill 2020 sought to increase the compensation from the current cap of KES500,000 to KES1-million. The Bill also sought to make the compensation be made for each account instead of per depositor, amid opposition from the Treasury and the Kenya Deposit Insurance Corporation (KDIC). The proposal to double the compensation came months after it was increased to KES500,000 from KES100,000 — the first time in three decades. “If subsection 28(2) of the principal Act is amended, unscrupulous individuals can collude to open several accounts in a bank and bring down the bank so that they can benefit from the deposit insurance,” the committee said in its report on the Bill.
Source: Business Daily
KenyaSafaricom share hits highest price since NSE listing
Safaricom’s share price hit a new record on Thursday, 12 August, earning investors KES78.13-billion in a week and lifting the Nairobi Securities Exchange (NSE) to a 39-month high. The stock closed at a volume-weighted average of KES43 on the Nairobi bourse on Thursday compared to KES41.05 on Tuesday, 3 August. The gains sent the telecommunications company’s valuation to a new high of KES1.722-trillion, representing 61.2% of the combined investor wealth at the NSE. Safaricom’s stock rally has pushed the entire market value to a 39-month high of KES2.815-trillion, helped by other top counters such as Equity, KCB and Co-op Bank whose gains over the seven trading days stand at KES4.71-billion, KES3.05-billion and KES880-million, respectively. The NSE’s combined wealth was last seen at this level on 13 April 2018 when it closed at KES2.819-trillion. Analysts say Safaricom stock is still benefiting from the news of its Ethiopia entry and the confirmation that the Horn of Africa country will soon allow the Kenyan firm to add mobile money to its telecommunications offerings.
Source: Business Daily
LesothoLHDA invites tenders for the construction of Polihali dam
The Lesotho Highlands Development Authority (LHDA) is seeking a company to build the future Polihali dam. Companies interested in the call for expressions of interest have until 12 November 2021 to submit their proposals. On 9 August 2021, the LHDA, which is piloting the project, issued a new call for tenders targeting national and international companies. Unlike the call for expressions of interest issued in May 2021 for the construction of a tunnel (38 kilometres) for water diversion, this new development is for the construction of the Polihali water reservoir. “Our objective with this latest development is to attract suitably qualified companies with the capacity, experience and resources to undertake the construction of the Polihali dam within the set timeframe and with the required quality,” explains Tente Tente, the LHDA’s managing director. The company will build a dam with a capacity of 2.325 million cubic metres. The dam, located in the upper basin of the Orange River, will be supported by a saddle dam. The water stored by the Polihali dam will supply the people of the Lesotho highlands and allow the development of irrigated agriculture.
Source: AFRIK 21
NamibiaGlobal Petroleum enters next licence phase for Petroleum Exploration Licence 94 offshore Namibia
Global Petroleum announced that in relation to its licence PEL0094 (Block 2011A) offshore Namibia, the Ministry of Mines and Energy has agreed to Global’s proposal to enter into the next licence sub-period from September 2021 to September 2022. Under the terms of the Petroleum Agreement for PEL0094 signed in September 2018, the four-year Initial Exploration Period (IEP) was split into two sub-periods of two years each, with the first sub-period ending in September 2020, subsequently extended to September 2021 with a reduced work programme. Global further expects to apply for a one-year extension to the four-year IEP at the appropriate time - such extensions are commonly granted by the ministry, for example in the case of the company’s previous licence PEL0029. The work commitment for the upcoming phase of the licence is to acquire and process 2,000 square kilometres of 3D seismic data, a commitment which Global expects to fulfil via a farm-out..
Source: Africa Business Communities
NamibiaNamibia gets NAD682.3-million for green hydrogen
Namibia is set to receive over NAD682.3-million from the German government to assist with research on venturing into green hydrogen. The funding, equivalent to about EUR40-million, was announced on Tuesday, 3 August, at the launch of the green hydrogen request for proposals (RFP) and handover of the second Harambee Prosperity Plan (HPPII) first quarter report. The national planning commissioner, Obeth Kandjoze, said in addition to examining the feasibility of Namibia getting into exploiting green hydrogen, the money will also be used to set up the Green Hydrogen Council of Namibia. He added that Namibia is partnering with countries willing to help it push through its agenda to develop and improve its economic performance. “Preliminary estimates of this potential [project] estimate Namibia's annual production of green ammonia in excess of 2.5 million tonnes, and thus will attract more than USD6-billion in foreign direct investment, while generating annual revenue in excess of USD800-million,” Kandjoze noted. He said the introduction of green hydrogen in Namibia will help push the country to the forefront of such development in the Southern African region, as well as tap into the available financial resources from the investments.
Source: The Namibian
RwandaRwanda to host headquarters of AU-backed e-commerce platform
Rwanda will host the continental headquarters of Sokokuu, an e-commerce platform aimed at enhancing the role of Africa’s small and medium enterprises (SMEs) in inter- and intra-African trade. This emerged following a meeting of President Paul Kagame and former Ethiopian Prime Minister, Hailemariam Desalegn, who is the patron of the Africa Electronic Trade Group, and Mulualem Syoum, the Group’s chief executive officer and board chair. Sokokuu loosely translates to common market or central market. The platform is a result of a collaboration between the African Union Commission and continental, regional and national bodies in the public and private sectors to digitally enable the implementation of the African Continental Free Trade Area, thus enhancing intra-African trade, SME development and industrial development.
Source: The New Times
Sierra LeoneSierra Leone’s economy is recovering from COVID-19 contraction although uncertainties persist
Sierra Leone’s economy is projected to recover from the COVID-19 contraction with real gross domestic profit (GDP) expected to rebound by 3.0% in 2021, an upward revision of 0.8 percentage point relative to the 2020 forecast, according to the new World Bank ‘Sierra Leone Economic Update’ launched on 5 August 2021, in Freetown. The growth rebound reflects the expected recovery of agriculture, mining and services following the easing of COVID-19-related restrictions and government’s Quick Action Economic Response Program (QAERP). Fiscal deficit almost doubled in 2020 due to a combination of revenue shortfalls and spending increases to support the government’s pandemic response. The deficit is expected to decline gradually to 2.4% of GDP by 2023 as COVID-19-related spending is reduced while revenue mobilisation improves on the back of the expected economic recovery. To strengthen fiscal sustainability, the report recommends that the authorities should quickly draw up a roadmap for fiscal consolidation, anchored by robust revenue mobilisation and expenditure rationalisation reforms, to return to the pre-pandemic (2018/19) fiscal path.
Source: World Bank
SomaliaSomali president freezes new trade, security pacts until after polls
Somali President Mohamed Abdullahi Mohamed (Farmaajo) has issued a directive barring all government officials and public institutions from entering into new economic, political and security agreements during the electioneering period. The president said the directive which is aimed at safeguarding the national assets and sovereignty of Somalia will remain in force until the next government is sworn in and takes office. "Until after the elections, all ministries and government agencies are prohibited from entering agreements or talks on behalf of the Federal Government of Somalia that affect the future, sovereignty, the land and the sea of our country," he said in a directive released on Saturday, 7 August. Analysts say the latest executive order will stop reported dealings that have been the norm during the electioneering period. "Until after the elections, all new trade agreements with other countries remain suspended," he said. The president said in issuing the directive, he took into account the prevailing political situation in the country and the constitutional responsibilities of the two Houses of Parliament in ratifying agreements entered between Somalia and other countries, institutions and international companies.
South SudanLow oil revenues shrink South Sudan’s economy by 1.1%
South Sudan’s real gross domestic profit (GDP) is expected to contract by a further 1.1% this year as a result of a drop in revenues generated from oil, which accounts for 90% of the country’s goods exports and more than 80% of total government revenue, says rating agency Fitch Solutions. In a study on the macroeconomic situation of the country, Fitch says foreign and private investment in the oil sector will continue to be hampered because of insecurity, thus resulting in an 8% drop in oil production this year. With the dominant oil sector shrinking, it is expected that the non-oil economy will also struggle to recover in 2021, keeping the country in a recession. The agency notes that the country’s inflation rate, which has been showing signs of stabilising over the past two years following the country’s attempts at peace, shall increase, dampening purchasing power. South Sudan’s economic woes have been aggravated by the global pandemic, COVID-19 and two consecutive years of flooding which have affected agricultural outputs. The agriculture sector in South Sudan employs 38.4% of the country’s workforce.
Source: The EastAfrican
TanzaniaTanzania FDI reaches USD1-billion in 2020, more than Kenya and Uganda
The United Nations Conference on Trade and Development (UNCTAD) has released its World Investment Report 2021, indicating that global foreign direct investment (FDI) flows dropped by -35% to USD1-trillion in 2020 from USD1.5-trillion in 2019, and almost -20% below the 2009 trough after the global financial crisis. In the report, the acting secretary-general of UNCTAD, Isabelle Durant, explains that the COVID-19 pandemic caused a dramatic fall in FDI in 2020, bringing the flows back to the level seen in 2005. The crisis has had an immense negative impact on the most productive types of investment, namely, greenfield investment in industrial and infrastructure projects. This means that international production, an engine of global economic growth and development, has been seriously affected. In 2020, FDI to East Africa dropped to USD6.5-billion, a -16% decline from 2019. FDI to Kenya decreased by -34% to USD717-million, compared with USD1.098-billion in 2019. FDI to Uganda decreased by -35% to USD823-million, compared with USD1.3-billion in 2019. However, FDI to Tanzania slightly increased to USD1-billion in 2021 from USD991-million in 2019.
Source: Tanzania Invest
TanzaniaTanzania maize exports to Kenya surge sixfold after Samia visit
Maize imports from Tanzania jumped more than sixfold to 118,329 bags in May on the back of President Samia Suluhu Hassan’s visit to Kenya that saw Dar es Salaam and Nairobi reach a deal to lift a ban that had been put in place. Kenya's Ministry of Agriculture says the volumes jumped from 16,731 bags in April to a monthly record of 118,329 in May after President Samia Suluhu Hassan and her Kenyan counterpart Uhuru Kenyatta reached a bilateral deal to abolish the restrictions that Nairobi had imposed on Tanzanian maize. Kenya had in April banned maize imports from Tanzania and Uganda, citing a high level of aflatoxin beyond the required minimum of 10 parts per billion. “Informal cross-border trade reported that the total quantity of maize imports in April was 16,731 bags. In May, the imports increased to 118,329 bags,” said the ministry. “There was reduced importation of maize in April, which is attributed to restriction of importation of maize across the region.” Kenya is a maize deficit country and relies on imports from Tanzania and Uganda to meet its annual demand.
Source: The EastAfrican
TanzaniaTanzania signs Treaty for the establishment of the African Medicines Agency
Tanzania has become the 22nd African Union (AU) member state to sign the Treaty for the establishment of the African Medicines Agency (AMA) on 10 August 2021, at the AU Commission in Addis Ababa, Ethiopia. H.E. Dr Monique Nsanzabaganwa, deputy chairperson, AU Commission, received H.E. Liberata Mulamula, minister of Foreign Affairs of Tanzania. Dr Nsanzabaganwa noted that Tanzania has been a key leader in supporting the efforts of the AU Commission and the East African Community, in the harmonisation of regulatory policies, under the African Medicines Harmonization Initiative, being led by the African Union Development Agency (AUDA-NEPAD). “The current pandemic has reinforced the need for the continent to have very strong continental health institutions and the AMA working in tandem with the Africa Centres for Disease Control and Prevention (CDC) will be the key to collectively address the continental health challenges,” she added. She encouraged Tanzania to move to the next step of ratifying the Treaty for the establishment of AMA.
ZimbabweChrome export ban sends tremors
The government’s shock decision to ban the export of raw chrome has sent shivers across markets, with mining industry players and leading experts calling on authorities to roll out incentives to stimulate domestic processing. They said while the ban announced recently was informed by significant investments into smelting facilities, the existing 22 processing plants fell far short of market requirements, which could lead to the exploitation of small scale producers. They spoke as government announced its second chrome export ban, five years after lifting another, which has been in force between 2011 and 2015. For many, the recent dramatic developments demonstrated the governments struggle to come up with a solid policy during a period when rocketing mineral prices in the international markets have given other producing countries opportunities to unlock value. In 2015, Zimbabwe, which holds the second largest chrome ore reserves in the world after South Africa, lifted the ban and scrapped a 20% export tax. But recently, cabinet said the new ban came after massive investment into processing capacity. It said continuing with exports could suffocate domestic smelters of feedstock and trigger a fresh wave of bankruptcies.
Source: The Standard