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issue 563 | 15 Sep 2024

Central Africa

AfDB and partners host regional training workshop to advance climate transparency efforts in Central Africa

The African Development Bank (AfDB) in partnership with the Economic Community of Central African States, United Nations Framework Convention on Climate Change, United States Forest Service, and United Nations Development Programme (UNDP) jointly hosted a regional training workshop on Nationally Determined Contributions (NDCs) Monitoring and Support for Biennial Transparency Report (BTR) Preparation from 26-30 August 2024, in Brazzaville, Republic of the Congo. The workshop was convened to train participants, drawn from 11 countries in Central Africa, in the preparation of BTRs, a crucial step towards the implementation of the Paris Climate Agreement’s NDCs. Under the Enhanced Transparency Framework, parties to the Paris Agreement are required to submit BTRs every two years, with the first submission due by 31 December 2024. Speaking virtually on the training, Ms Arlette Soudan-Nonault, the Republic of the Congo's Minister of Environment, Sustainable Development, and the Congo Basin, said; "countries agreed to maintain global temperatures below 2 degrees Celsius, yet the latest [United Nations Environment Programme] report reveals a growing gap between our goals and the reality of rising emissions. This is far from the objectives of the Paris Agreement and underscores the urgent need to reduce emissions by 2030.”

Source: AfDB

East Africa

EAC central banks urged to adapt and embrace technology to facilitate cross-border financial transactions

The East African Community (EAC) partner states central banks have been called upon to embrace technology as part of efforts to facilitate cross-border payments within the EAC Common Market. Making the appeal, EAC Secretary General Veronica Nduva said some of the challenges behind the low uptake of the East African Payments System (EAPS) include limited capacity, lack of inter-operability, communication gaps between central banks and stakeholders, fear of online scams, protectionism by central banks and overlapping membership by partner states to payment systems set up by various Regional Economic Communities. Launched in 2014, EAPS is a secure, effective and efficient funds transfer system whose aim is to enhance efficiency and safety of payments and settlements within the EAC region. Secretary General Nduva underscored the role of partner states central banks in putting in place an efficient payments and settlements system for the region, adding that unlike many markets in goods and services, financial markets and systems are trust‐based markets – in which case, the role of central banks in building public confidence in the uptake of new technology-driven payment systems is vital.

Source: EAC

East Africa

EAC and IGAD to roll out digital integration project to boost connectivity, access and economic growth

The East African Community (EAC) and the Intergovernmental Authority on Development (IGAD) are set to commence implementation of the Eastern Africa Regional Digital Integration Project (EARDIP), a transformative initiative aimed at improving digital connectivity and integration across eastern Africa. Speaking during an EARDIP Regional Coordination and Implementation Workshop in Dar es Salaam, Tanzania, the EAC Deputy Secretary General of Customs, Trade and Monetary Affairs, Ms Annette Ssemuwemba, termed the project a game-changer for eastern Africa. “This project will create a more interconnected, inclusive, and prosperous region. We are laying the foundation for a thriving digital economy that will benefit businesses and citizens alike," said Ms Ssemuwemba. “With EARDIP, we are not just addressing the challenges of today, but we are building the digital infrastructure of tomorrow,’ she said. Ssemuwemba said that the project would unlock the region’s potential, creating opportunities for innovation, trade, and economic growth that will uplift millions. “It will also ensure that no one is left behind as we transition to a more digital and interconnected future,” she added.

Source: EAC

East / Southern Africa

COMESA finalises revision of SPS regulations, strategy, and implementation plans

The Common Market for Eastern and Southern Africa (COMESA) has finalised the revision of its sanitary and phytosanitary (SPS) regulations, strategy, and implementation plans. This initiative aims to strengthen SPS capacities across member states by eliminating inconsistencies that have hindered regional trade in food and agricultural products. SPS measures are regulatory tools designed to protect human, animal, and plant life from risks such as additives, contaminants, toxins, or disease-causing organisms. By recognising the SPS measures of exporting member states, the revision will streamline cross-border trade, reducing the need for repeated testing and certification, ultimately lowering business costs. The review process took place from 2-6 September in Nairobi, Kenya, in a workshop attended by experts from COMESA member states. Organised in collaboration with the African Union Commission, the workshop focused on key areas such as harmonising SPS measures, establishing equivalence in standards, risk assessment, and ensuring transparency in the implementation process. The finalised regulations, strategy, and implementation plans will be submitted for approval by COMESA’s policy organs later this year.

Source: COMESA

Benin

IMF staff concludes visit to Benin

An International Monetary Fund (IMF) team, led by Mr Constant Lonkeng, visited Cotonou from 5-11 September 2024, to assess recent economic developments, discuss the contours of – and policy intentions under – the 2025 budget and gauge progress in commitments under Benin’s fund-supported programmes. The IMF Executive Board approved in July 2022 a blended Extended Fund Facility (EFF) / Extended Credit Facility (ECF) arrangement. This was complemented by the Resilience and Sustainability Facility (RSF) in December 2023. The combined Fourth EFF/ECF and First RSF reviews were completed in June 2024. At the end of the visit, Mr Lonkeng issued the following statement, in part: “Benin’s macroeconomic performance remains strong despite a challenging external environment, including the sharp depreciation of the naira. Economic activity is estimated to have expanded by 6.6% in 2024: Q2 year-over-year (6.3% in 2024: Q1), a momentum expected to continue in the coming quarters. While aggregate inflation was limited to 3% in August (year-over-year), food prices rose by 6.6%, partly driven by higher exports to neighbouring countries amid a challenging regional security situation.”

Source: IMF

Botswana

IMF Executive Board concludes 2024 Article IV consultation with Botswana

On 28 August 2024, the Executive Board of the International Monetary Fund (IMF) concluded the Article IV consultation with Botswana and endorsed the staff appraisal without a meeting on a lapse-of-time basis. Botswana’s economic growth decelerated from 5.5% in 2022 to 2.7% in 2023, below the long-run potential growth of 4%. A sharp decline in diamond trading and mining activities was the main contributor to the slowdown, as global demand for rough diamonds decreased. Inflation has remained below the ceiling of the central bank’s medium-term objective range since July 2023. Despite lower diamond exports, foreign exchange (FX) reserves increased in 2023 supported by higher customs union receipts. The financial sector is broadly sound, stable, and resilient. Botswana’s economy is expected to decelerate further this year, with growth projected at 1%. The continued slowdown is mainly due to a fall in diamond production, partly offset by construction projects financed by the fiscal expansion. Growth is forecast to rebound – averaging 5% over the next two years – due to higher prices and quantities of diamonds produced. Inflation is projected to remain within the central bank’s objective range of 3 – 6%.

Source: IMF

Cabo Verde

EU, EIB invest EUR300-million in Cabo Verde’s infrastructure, digital, energy sectors

The European Union (EU) and the European Investment Bank (EIB) have announced a EUR300-million investment to strengthen Cabo Verde’s digital infrastructure, ports and renewable energy sectors. The energy sector will receive EUR159-million to design and build an electricity production, grid and storage system. The investment aligns with Cabo Verde’s National Electricity Master Plan, which aims to reduce the country’s reliance on costly and polluting fossil fuels by 2040, while integrating renewable energy storage. In the digital sector, EUR37-million will be invested to position Cabo Verde as a digital hub for West Africa. The funding will support the installation of a next-generation submarine cable linking Europe to West Africa and modernise the nation’s inter-island fiber-optic network. An additional EUR105-million will be allocated to expand and modernise key ports, including Porto Grande in São Vicente, Porto Novo in Santo Antão and Palmeira on Sal Island. “Together, we are paving the way for a more sustainable and prosperous future for the people of Cabo Verde and the wider West African region,” said European Commissioner Jutta Urpilainen.

Source: Energy Capital & Power

Kenya

Kenya bans sugar imports from outside COMESA, EAC trade blocs

Kenya has recently imposed a ban on sugar imports from outside the Common Market for Eastern and Southern Africa (COMESA) and the East African Community (EAC), two regional trade blocs, citing an increase in local production. Andrew Karanja, Cabinet Secretary for the Ministry of Agriculture and Livestock Development, said in a statement released in the Kenyan capital of Nairobi that local sugar production has improved, with the country expected to produce more than 800 000 metric tonnes this year. Karanja said the government thus had not extended the import window for sugar from countries outside the COMESA and EAC trading blocs. He noted that over the past four years, Kenya has produced about 700 000 metric tonnes of sugar annually from 16 factories, with production peaking at around 800 000 metric tonnes in 2022. Karanja observed that 2023 had been an unusual year, beginning with a severe drought that led to reduced sugar output, which necessitated significant imports to bridge the supply gap. He said that the average annual consumption of table sugar in Kenya is about 950 000 metric tonnes, with the shortfall covered by imports from COMESA and EAC countries under existing trade protocols. The East African nation temporarily allowed sugar imports from outside these regions to protect consumers from high prices, he said, adding that imports from COMESA and EAC are currently facilitated by sugar safeguards, which are set to expire in February 2025.

Source: Xinhua

Kenya

Mombasa port receives its first LNG-powered ship

The first-ever tanker powered by liquefied natural gas (LNG) to call on the Mombasa port berthed recently, an itinerary revealed, boosting the gateway’s go-green emissions strategy in line with the International Convention for the Prevention of Pollution from Ships (MARPOL Convention). Mv Arctic Tern, currently sailing under the flag of Singapore, delivered a consignment of palm oil from Malaysia to Mombasa. The vessel, which was commissioned on 14 March 2024, is 183 metres long and 32 metres wide. As emissions regulations become more stringent, many ship owners are turning to alternative fuels to power their vessels, with LNG emerging as a popular choice. LNG used to fuel ships is produced from natural gas extracted from underground reserves, including both onshore and offshore gas fields. The arrival of Mv Artic Tern is a boost for the Port of Mombasa as it joins other seaports around the world in implementing MARPOL Convention, the International Maritime Organization's main convention for the prevention of pollution of the marine environment by ships from operational or accidental causes.

Source: The EastAfrican

Lesotho

IMF Executive Board concludes 2024 Article IV consultation with Lesotho

The Executive Board of the International Monetary Fund (IMF) concluded the Article IV consultation with Lesotho. GDP growth picked up modestly to 2.2% in 12-month period ending March 2024, compared with 1.6% a year earlier. This largely reflects accelerated construction from the Lesotho Highlands Water Project. Nonetheless, unemployment remains high, diamond and textile exports have been sluggish, and an exceptional dry season increased food-security concerns across the country. Headline inflation reached 6.5% in June, up from 4.5% in July 2023, though down from a peak of 8.2% in January 2024. The increase in inflation was largely due to exogenous factors that will most likely fade going forward. Lesotho registered a sizable fiscal surplus of 6.1% of GDP in the fiscal year ending March 2024. In a change from past practice, transitory Southern African Customs Union (SACU) transfers (10.4% of GDP higher than in FY22/23) were not accompanied by a parallel increase of the public wage bill. Instead, the authorities used the SACU proceeds to reduce arrears and rebuild deposits at the central bank. Growth is projected to peak in the fiscal year ending in March 2025 (at 2.7%), while inflation is expected to ease slowly. Another year of windfall SACU transfers (6 percentage points of GDP above the 10-year average) will again bolster fiscal and external balances in FY24/25.

Source: IMF

Mauritania

Mauritania's Parliament approves Green Hydrogen Code

The Mauritanian Parliament has approved the Green Hydrogen Code Bill, utilising its solar and wind resources to become a hub for clean energy production. In a recent address to Parliament, Minister of Energy and Petroleum, Mohamed Ould Khaled, highlighted green hydrogen as a key pillar in the country’s efforts toward a comprehensive and sustainable energy transition. Several studies have assessed Mauritania’s energy potential, including a March 2024 report by renewable energy firm Chariot. The study outlines the ambitious Nour project, developed in partnership with TotalEnergies, which aims to produce 88 GW of renewable energy and up to 150 000 tonnes of green hydrogen annually.

Source: Energy Capital & Power

Mauritius

OECD and Mauritius further strengthen and deepen cooperation with new Country Programme and adherence to investment policy standard

On 6 September 2024, the Organisation for Economic Co-operation and Development (OECD) and Mauritius agreed on a three-year Country Programme to further strengthen and deepen cooperation aimed at supporting Mauritius on its policy reform journey to regain and maintain its status as a high-income economy. OECD Secretary-General Mathias Cormann and Dr Renganaden Padayachy, Minister of Finance, Economic Planning and Development, signed the Country Programme at a ceremony in Port Louis, which also saw Mauritius become the first sub-Saharan African country to adhere to the OECD Declaration on International Investment and Multinational Enterprises, building on a decade of cooperation with the OECD. The Country Programme will support Mauritius with analysis and best practice policy recommendations to help it address economic challenges and advance structural reforms aimed at improving the business climate. Work under the programme will focus on strengthening institutions, corporate governance, the regulatory environment, and anti-corruption practices. It will also offer advice on efficient tax policies and on building a more transparent and globally comparable national statistical system.

Source: OECD

Namibia

Namibia’s NamPower signs new contracts for 100 MW solar PV project

Namibia’s state power utility Namibia Power Corporation (NamPower) has signed a USD78-million engineering, procurement, and construction contract with two Chinese companies for the development of the 100 MW Rosh Pinah solar photovoltaic (PV) project. The agreement was formalised by NamPower’s Managing Director, Kahenge Haulofu, and representatives from China Jiangxi International Economic and Technical Cooperation and Zhejiang CHINT New Energy Development. According to Haulofu: “The investment will contribute to managing and regulating future increases in electricity tariffs. This will not only benefit individual consumers by lowering increases to their electricity bills but also contribute to the overall economic growth and environmental sustainability.” Construction on the project is expected to take 18 months, with up to 800 workers at peak installation. The plant, set to begin operations in the second quarter of 2026, will represent Namibia’s second and largest solar PV project to date. In addition, NamPower has secured a nearly USD73-million loan from the German Development Cooperation through Kreditanstalt für Wiederaufbau (KfW) Development Bank, covering nearly 80% of the project’s total cost. NamPower will fund the remaining 20% from its balance sheet. “The 20% own contribution together with the KfW concessional loan has enabled the PV project to be extended from 70 MW to 100 MW,” said KfW Development Bank Country Director, Beatrice Lucke.

Source: Energy Capital & Power

Namibia / Botswana

Namibia and Botswana cut roaming charges for better cross-border communication

The Ministry of Information and Communication Technology (MICT) has announced that Namibians travelling to Botswana will now be able to enjoy reduced roaming charges effective since August 2024. According to a statement released by the Ministry’s Executive Director, Dr Audrin Mathe recently, this decision follows high-level talks between the Minister of Information and Communication Technology and the Botswana Minister of Communications, Knowledge and Technology. The new roaming tariffs marks a new chapter in digital transformation by the two countries and are expected to boost cross-border communication and strengthen bilateral relations while fostering greater economic opportunities for business and travel, the ministry stated. The Communications Regulatory Authority of Namibia and Botswana Communications Regulatory Authority have officially directed the two countries’ mobile companies namely Telecom Namibia and MTC, and Botswana Telecommunications Corporation Limited, Mascom Wireless Botswana and Orange Botswana to slash roaming prices. This initiative is a testament to the ministry’s commitment to deliver affordable communication services to all Namibians and it will have a positive impact on trade, tourism, and cross-border connectivity.

Source: Namibia Economist

South Sudan / China

South Sudan, China eye new oil pipeline route

The Government of South Sudan and state-owned China National Petroleum Corporation (CNPC) are considering the construction of a new oil pipeline in South Sudan to reduce dependency on existing infrastructure. The proposal follows a meeting between South Sudan’s President Salva Kiir and CNPC President Dai Houliang, where the two parties discussed increasing crude oil production, building a new refinery and strengthening South Sudan’s oil distribution network. The proposed pipeline would pass through Djibouti and Ethiopia and enhance the export potential of Blocks 3 and 7 in South Sudan. Reiterating CNPC’s commitment to its partnership with South Sudan, Houliang pledged continued support for South Sudan’s oil operations. CNPC holds a 41% stake in South Sudan’s largest oil operator, Dar Petroleum Operating Company, which operates Blocks 3 and 7.

Source: Energy Capital & Power

Tanzania

Analysts weigh in as earnings from tourism cross USD3.5-billion

Tanzania is comfortably gaining from tourism as the sector shows signs of a complete recovery from the negative effects of the global COVID-19 pandemic. Official figures now put the number of tourist arrivals at a record 2.026 million. The figures, published by the Bank of Tanzania (BoT) show that these tourists brought in a record USD3.534-billion during the year ended July 2024. This, according to the BoT’s Monthly Economic Review for August 2024, was USD531.8-million more than what the country registered during the preceding year. “The rise in travel receipts arises from the recovery observed in the tourism industry, reflected by the increase of tourist arrivals by 22% to 2 026 378,” the BoT says in the report. This rise propelled Tanzania’s services receipts increase to USD6.706-billion during the year ending July 2024, up from USD5.542-billion in the corresponding period in 2023, the BoT says. Analysts say the numbers reflect a full recovery from the travel restrictions imposed by major source countries during the COVID-19 pandemic. Tanzania had a target of receiving 2 million tourists in 2020 but the target was knocked down by the global COVID-19 pandemic.

Source: The Citizen

Togo

IMF Executive Board concludes 2024 Article IV consultation with Togo

The Executive Board of the International Monetary Fund (IMF) concluded the Article IV consultation with Togo. Following a series of shocks in recent years, Togo continues to face headwinds, including persistent challenges of food security and terrorist attacks, while broader development needs remain acute. Fiscal expansion implemented in response to the shocks has helped preserve robust economic growth but has also pushed up public debt, reversing the debt reduction achieved during the 2017–20 Extended Credit Facility (ECF) arrangement, eroding fiscal space and buffers to absorb shocks, and contributing to regional vulnerabilities in the West African Economic and Monetary Union. In response to these challenges, in March 2024, the IMF approved the authorities’ request for a new arrangement under the ECF. Against a background of a substantial strengthening of fiscal revenue and a beginning of fiscal consolidation in 2023, the macroeconomic outlook is broadly favourable. Growth is expected to remain robust, while fiscal revenue is expected to rise further. There are no substantial domestic or external disequilibria, with low inflation and a well-contained current account deficit.

Source: IMF

Togo

Togo and Huawei boost cooperation with new MoU

Togo and Huawei are stepping up their cooperation on the information and communications technology front. The two partners signed a memorandum of understanding (MoU) recently in Beijing, during the 9th Forum on China-Africa Cooperation Summit. The document was signed by the Togolese Minister of Trade and Industry. The MoU aims to improve Togo's digital infrastructure and create new economic opportunities. Huawei, a global leader in infrastructure and connected devices, presented its technological innovation projects to the Togolese delegation. Meanwhile, Togolese President, Faure Gnassingbé, noted that these innovations align with his country's goals to develop its digital economy and position Togo as a digital hub in the region. Besides discussing with Huawei Executives, President Gnassingbé met with Chinese investors, including representatives from the China Road and Bridge Corporation and the China Africa Business Council. With them, he explored public-private partnerships for infrastructure and logistics in Togo. Still at the FOCAC, Togo signed another MoU with Haier, another Chinese technology giant, to enhance collaboration in the energy and health sectors.

Source: Togo First

Togo / China

Togolese and Chinese Chambers of Commerce sign new MoU to boost bilateral trade

Togo’s Chamber of Commerce and Industry and China’s Chamber of Commerce for Import and Export of Machinery and Electronics Products are now partners. The two chambers signed a memorandum of understanding (MoU) to this end last in Beijing, during the 9th Forum on China-Africa Cooperation (FOCAC) Summit. The MoU aims to bolster relations between Togolese and Chinese businesses, amid recovery from COVID-19. Besides this agreement, the Togolese Ministry of Investment Promotion also signed another MoU with the China Africa Business Council, a Chinese organisation dedicated to Africa's economic development. This partnership focuses primarily on investment financing consultancy and aims to boost trade between China and Togo. During the FOCAC, Togolese authorities organised investment roundtables to enhance collaboration between the government and the private sector, while paving the way for lasting partnerships with Chinese companies.

Source: Togo First

Uganda

IMF Executive Board concludes 2024 Article IV consultation with Uganda

On 6 September, the Executive Board of the International Monetary Fund (IMF) concluded the 2024 Article IV Consultation with Uganda. Uganda has navigated the post-pandemic recovery well due to sound macroeconomic policies. The economic recovery is strengthening with low inflation, favourable agricultural production, and strong industrial and services activity. Growth is estimated at 6% in FY23/24, up from 5.3% in FY22/23. Headline inflation has increased to 3.9% by June 2024, driven by rising energy prices and core inflation, though the latter remains below the Bank of Uganda’s target of 5%. Elevated current account deficit and limited capital inflows have weighed on Uganda’s international reserves. Despite strong coffee and gold exports, the current deficit remains high due to rising oil project-related imports. Tight global financial conditions and reduced external project and budget support have driven down gross international reserves, covering only 2.9 months of imports at the end of 2024 (excluding oil-project related imports). The overall fiscal deficit continued to decline in FY23/24 but was less than planned due to revenue underperformance and higher current spending, while development spending fell short of expectations, worsening expenditure composition.

Source: IMF

Uganda

The High Court of Uganda upholds PPDA directive to boost competition in public procurement of motor vehicles

The High Court has upheld a move by the Public Procurement and Disposal of Public Assets Authority (PPDA) to expand the list of potential suppliers of vehicles to public entities. The move, seen as positive for competition and therefore consumer benefit was hotly contested by Ugandan representatives of vehicle manufacturers who hitherto enjoyed a virtual monopoly. In CFAO Motors Uganda Limited v The Public Procurement and Disposal of Public Assets, the Ugandan representatives of several motor vehicle manufacturers, sought to challenge a circular by the PPDA which permitted entities authorised by suppliers and distributors, to bid for the supply of vehicles to public entities. Until this circular, it was only entities authorised directly by vehicle manufacturers that could bid.

Source: ENS