INTERNATIONAL

COVID-19: Trade restrictions are worst possible response to safeguard food security - As COVID-19 spreads around the globe, fears of a deep global recession are mounting. Some also fear that food supplies may start running short, especially if supply chains are disrupted. Others fear that agricultural production may be disrupted by containment measures that restrict workers from harvesting and handling crops. While we should take these concerns seriously – especially for fruits and vegetables, which have complex supply chains, or foods sold primarily through restaurants – they should not be overstated either, especially not for basic staples such as rice, wheat and maize. Global markets are well supplied, stocks are healthy, production of key staples is unlikely to be disrupted and prices have remained relatively stable. Trade is allowing production to move from areas of surplus to areas of shortage, avoiding the drastic shortages and food insecurity associated with reliance only on local production. But there will be serious threats to the access of the poor to food as a consequence of lost income from lockdowns and other restrictions. These should be addressed through measures that help maintain access to food, rather than through policies like export bans that may threaten that access. The food price crisis of 2007-2008 shows, however, that policy concerns about food availability can easily turn into a serious price crisis. At the time, some countries responded by imposing export restrictions, which pushed up world market prices of staples, leading other grain exporters to also limit exports in efforts to insulate their consumers from the initial food price rises. Food importing countries worried about the higher cost of food, in turn, lowered import tariffs on food, supporting demand but keeping upward pressure on world prices. As a result, instead of containing price increases, these policy responses only drove world market prices higher. In the case of rice, these policy responses contributed almost half of the world price surge in 2007-2008. Unfortunately, once again several countries are considering export restrictions. See our online tracker. (trade4devnews)

Key Words: COVID-19, Trade, Food Security

ICC, WHO launch global business survey to improve coronavirus information flows – The International Chamber of Commerce (ICC) and World Health Organization (WHO) are launching a worldwide survey to report the challenges faced by the private sector from COVID-19. In response to COVID-19, ICC and WHO are surveying the private sector to gather more information about global business responses and develop solutions that will address the spread of the pandemic. The ICC-WHO survey will improve information flows between different sectors of the global economy and develop a framework for managing the economic and human consequences related to the pandemic’s spread. On the launch of the ICC-WHO survey, ICC Secretary General John W.H. Denton AO said: “By providing transparent feedback, the private sector can minimise the spread of COVID-19 and address the pandemic’s underlying repercussions for our global economy. ICC and WHO are calling on business leaders – as trusted voices in their local communities – to share more information about the pandemic’s influence on their daily operations, supply chains, and employees.” “Please, take a few moments to complete this survey, so that we can protect our colleagues, customers, and communities from the continual damage caused by this pandemic’s spread.” On the launch, ICC Ghana Secretary General Emmanuel Doni-Kwame said: “The survey is the latest step in ICC and WHO’s unique collaboration to provide reliable COVID-19-related information to the private sector and develop trusted guidance for business communities around the world.  As part of an initial joint statement, ICC and WHO called upon national governments to adopt a ‘whole-of-society’ approach in responding to the COVID-19 pandemic. Calling for participation in the survey via video message, WHO Director-General Dr Tedros Adhanom Ghebreyesus said: “This survey will allow us to understand how businesses are responding. It will help us map best practices and understand better where we and national health authorities should focus our attention. The information generated by the survey will help us mount an effective response, saving lives and minimising economic damage.” (Ghana Web)

Key Words: ICC, WHO, Global Business

Defending competition in the markets during COVID-19 – Under normal circumstances competition is needed in markets to keep prices low, but with the COVID-19 crisis wreaking havoc on markets the world over, collaboration has taken precedence. The pandemic’s sweeping economic impact has left governments balancing between defending competition, so prices do not become prohibitive, and granting exemptions to competition rules to ensure the survival of entire economic sectors. “Many authorities are adjusting the enforcement of competition laws to serve the greater public interest during this crisis,” said Teresa Moreira, head of UNCTAD’s competition and consumer policies branch. For example, the United States’ Department of Justice and the Federal Trade Commission have allowed collaborations among competitors in the health sector based on previous measures taken in the aftermath of hurricanes Harvey and Irma. The United States has enacted strict guidance on collaboration in a time of emergency. Likewise, Canadian and German authorities have allowed pro-competitive agreements between companies competing in the same market if they have good justifications. While Germany has given the green light for collaboration in the retail industry and for supermarkets, Canada has allowed collaboration to support the delivery of affordable goods and services. Similarly, the competition and markets authority in the United Kingdom has temporarily allowed retailers to collaborate to ensure the continuity of food supplies. Some governments have enacted sector-specific legislation granting different levels of exemptions from anti-collusion rules to businesses to mitigate the pandemic’s ripple effect on economies. For instance, South Africa has approved a specific list-based block exemption from antitrust rules in the health-care sector to allow cooperation. Norway has granted a three-month exemption from the national antitrust laws to the airline transport industry.  (UNCTAD)

Key Words: UNCTAD, COVID-19, World Market

PAN AFRICA

Africa’s Response to COVID-19 - Key Messages for IMF and WBG Meetings – COVID-19 is a global crisis affecting the whole world.  As the days go by the impact of the crisis becomes more visible and more general. Though hit later, Africa is already facing a synchronized and deep crisis. At all levels - health, economic, social – institutions are already overstretched. Africa is almost at a sudden stop economically even before the full brunt of the COVID19 reaches its shores. A heavy and durable economic toll, which will threaten progress and prospects, widen inequalities between and within countries, and worsen current fragilities is afoot on the continent. Unmanaged, it will in turn threaten developed countries’ recovery. This can be mitigated, but only if we act immediately and collectively. African leaders and policy makers across the board have met and are working together and have expressed their solidarity with the world and amongst themselves.  They have agreed to work in a coordinated manner to address this scourge. Countries thank the international community especially the WBG and the IMF for being forward and for moving to repurpose funding of over $2.3 billion dollars already. However they ask for accelerated speed and increased scale to match the level of the crisis. African countries need support in managing the health crisis, and preparing for a durable economic fallout. The measures being taken in Asia, Europe and North America such as physical (social) distancing and regular hand washing are a particular challenge for countries with limited internet connectivity, dense populations, unequal access to water and limited social safety nets. While stimulus measures being put in place across the developed world already amount to over 10 percent of GDP in most countries, and include immediate unemployment benefits, mortgage suspension, loan standstills, food support, tax holidays, bridge financing for large corporates, additional measures for specific sectors - $500 billion specific stimulus for the US airline sector for example, this is not a possible option for most of the continent. (UNECA)

Key Words: COVID-19, UNECA, Africa

The African Development Bank and its partners want your ideas for beating the COVID-19 pandemic – The African Development Bank and partners are set to host an online #AfricaVsVirus Challenge from 16 to 19 April 2020. The 72-hour competition is a global hackathon – or “ideathon” – to develop effective solutions to the coronavirus pandemic. The Challenge is open to entrepreneurs, companies, civil society organizations and governments with bankable solutions or ventures to address the pandemic. The top pitches will be eligible to win thousands of dollars’ worth of financial, technical and skills-learning support to advance their implementation. Details on competition qualifications and methods of participation can be found here: www.africavsvirus.com.   “COVID-19’s impact on the global economy is pushing millions of people, especially women and young people, into unemployment, underemployment and working poverty. Part of our response is  the #AfricaVsVirus Challenge,” said Tapera Muzira, Coordinator of the African Development Bank’s Jobs for Youth in Africa Strategy. “This online Challenge will channel youth creativity and innovation to real life solutions that mitigate the impact of the coronavirus on health, the economy, SMEs and jobs,” he added. The #AfricaVsVirus Challenge opens on Thursday, 16 April at 6:30 pm CET and runs non-stop through to Sunday, 19 April at 6:30 pm CET. Entrants can choose to submit ideas under one of the following sectors: public health and epidemiology; vulnerable populations; businesses and economy; community; education; entertainment; government support; environment and energy; and food security. Alternatively, they may choose their own theme.  An expert panel will select the twenty best solutions submitted, and these finalists will be invited to take part in a one-month educational program by Seedstars. The top three winning ideas will receive up to $50,000 worth of in-kind prizes. #AfricaVsVirus Challenge is part of the Bank’s strategy to support young African entrepreneurs – especially young women entrepreneurs – and their SMEs and startups by providing an enabling environment to innovate appropriate solutions to the COVID-19 crisis. (AfDB)

Key Words: AfDB, COVID-19, Youth Challenge

COVID-19 in Africa – some reflections on trade matters – A recent McKinsey report highlights the extensive impact of COVID-19 on Africa’s economies – noting the slowdown in economic growth, job and productivity losses, and bankruptcies. Importantly, the analysis also notes that school and university closures will impact future human resource capacity and are likely to particularly impact girls, some who may not return to school. The interaction between gender and the pandemic is particularly important in Africa. In many countries the majority of healthcare workers (nurses) are women, and women are also primary care providers at home.[1] Informal traders and especially informal cross-border traders are predominantly women. Women’s roles in agriculture vary across countries; in some, for example Uganda, Tanzania and Malawi, women’s labour input into crop production is higher than 50%. World Health Organisation (WHO) Regional Director for Africa Dr. Mathsidiso Moeti has noted, “for socially restrictive measures to be effective, they must be accompanied by strong, sustained and targeted public health measures that locate, isolate, test and treat COVID-19 cases.” Nationwide lockdowns have been implemented in a number of African countries, including Kenya, Uganda, the Republic of the Congo, Botswana, Zimbabwe and South Africa. South Africa’s initial stringent lockdown regulations were eased when it became apparent that a complete lockdown was not feasible. Social distancing, lockdowns and recommendations to frequently wash hands mean very little when your household does not have access to running water. Compound this with living with members of your extended family in a small corrugated iron shack, and you are all dependent on the income that your mother generates through cross-border trade.    Lockdowns, social distancing and other measures, that include trade restrictions, aimed at reducing the transmission of the virus also mean loss of income and jobs, as well as closure of small and vulnerable businesses. Making trade easier and less costly with due safety measures should be a key policy objective.  (trade4devnews)

Key Words: COVID-19, Trade, Africa

Africa’s Pulse: Assessing the economic impact of COVID -19 and policy responses in Sub-Saharan Africa –  Despite a late arrival, the COVID-19 virus has spread rapidly across Sub-Saharan Africa in recent weeks . As of April 7, 5,425 cases of COVID-19 have been confirmed in 45 of the 48 countries in SubSaharan Africa. The insufficient testing capacity in many countries in the region suggests that these figures most likely understate the true number of infections. u We project that economic growth in Sub-Saharan Africa will decline from 2 .4 percent in 2019 to -2 .1 to -5 .1 percent in 2020, the first recession in the region in 25 years . It will cost the region between US$37 billion and US$79 billion in terms of output losses for 2020. The downward growth revision in 2020 reflects macroeconomic risks arising from the sharp decline in output growth among the region’s key trading partners, including China and the euro area, the fall in commodity prices, reduced tourism activity in several countries, as well as the effects of measures to contain the COVID-19 global pandemic. u            The COVID-19 shock is hitting the region’s three largest economies—Nigeria, South Africa, and Angola—in a context of persistently weak growth and investment, and declining commodity prices . The prices of crude oil and industrial metals have fallen sharply (by 50 and 11 percent, respectively, between December 2019 and March 2020). Model simulations suggest that, compared with a no-COVID base case, average real gross domestic product (GDP) growth in these countries could be reduced by up to 6.9 percentage points in 2020 in the baseline scenario, and by up to 8 percentage points in the downside scenario. South Africa has the largest number of confirmed cases in the region, and strict measures to contain and mitigate the spread of the virus are weighing on the economy. More generally, countries that depend on oil exports and mining would be hit the hardest . Growth could fall by up to 7 percentage points in oil-exporting countries and by more than 8 percentage points in metals exporters compared with the no-COVID base case.  (World Bank Group)

Key Words: COVID-19, Policy Response, Sub-Saharan Africa

African Union Chair President Cyril Ramaphosa Appoints Special Envoys to Mobilise International Economic Support for Continental Fight Against COVID-19 – The Chairperson of the African Union, President of the Republic of South Africa His Excellency Cyril Ramaphosa has appointed Dr Ngozi Okonjo-Iweala, Dr Donald Kaberuka, Mr Tidjane Thiam and Mr Trevor Manuel as Special Envoys of the African Union to mobilise international support for Africa’s efforts to address the economic challenges African countries will face as a result of the COVID-19 pandemic. The Special Envoys will be tasked with soliciting rapid and concrete support as pledged by the G20, the European Union and other international financial institutions. President Ramaphosa says: “In the light of the devastating socio-economic and political impact of the pandemic on African countries these institutions need to support African economies that are facing serious economic challenges with a comprehensive stimulus package for Africa, including deferred debt and interest payments. “The impact of the coronavirus pandemic has been global in both scale and reach, and this necessitates coordinated international action to capacitate all countries to respond effectively, but most particularly developing countries that continue to shoulder a historical burden of poverty, inequality and underdevelopment,” President Ramaphosa said. President Ramaphosa added: “The sentiment expressed in two recent letters written to the G20 by a group of world leaders and a team of esteemed economists underscore the importance of bolstering health systems in poorer countries; this can only be done with the support of the international community.”  (AU)

Key Words: AU, COVID-19, Economic Support

Helios Towers has billions primed for expansion – Helios Towers’ plans to expand following last year’s London share sale may have been waylaid by the coronavirus outbreak, but the Africa-focused company has US$350-million (R6.6-billion) primed and ready for when deal-making can resume. The telecommunications firm raised funds in an initial public offering in October, with the proceeds earmarked to fund an entry into new African markets and add to a portfolio of almost 7 000 towers. “It’s not that talks stalled really as one can always have conference calls, but for any real M&A to happen you need things like on-the-ground site surveys,” CEO Kash Pandya said in an interview. “It will be slower for a few months, but the world will have to get back to normality at some point.” Helios’s capacity to finance deals remains intact, with $125-million in cash and another $225-million in debt available for acquisitions, the CEO said. The company plans to buy 2 500 towers over the next five years and build a similar number, he said. Tower companies such as Helios and closely held IHS Holding have been expanding in Africa to take advantage of faster Internet connections and take-up of smartphones across the continent. Meanwhile wireless carriers around the world have been disposing of tower assets to free up capital for other ventures, creating a sweet spot for deal-making. Helios is hardly alone in having its expansion plans delayed by the coronavirus. Companies all over the world have had to suspend M&A plans as business activity slows amid efforts to contain the pandemic, which has infected more than a million people and killed over 50 000. While Africa remains the least affected continent outside Antarctica, many countries have closed borders and imposed lockdowns to limit the spread of the virus. (Tech Central)

Key Words: Africa, COVID-19, Helios Towers

EAST AFRICA

Sudan and Egypt Affirm their Adherence to Washington Track for Filling of Renaissance Dam – Sudan and Egypt have affirmed their adherence to Washington's track as reference for the rules of filling and operating the Renaissance Dam and what was agreed upon in this path and the declaration of principles signed between the three countries in the year 2015. This came during the meeting between the Prime Minister, Dr. Abdalla Hamdouk, and the Egyptian Minister of Irrigation and Water Resources and the Chairman of Intelligence Service, in the presence of the Sudanese Minister of Irrigation and Water Resources and the Director of the General Intelligence Service. The meeting discussed the developments at the regional arena, the cooperation between Sudan and Egypt in different fields and the developments in the Renaissance Dam dossier. The meeting also discussed the arrangements for the coming visits of the Prime Minister, Dr. Abdalla Hamdouk, to Cairo and Addis Ababa shortly. (SNA)

Key Words: Regional Integration, Trade, East Africa

Coffee farmers are poised to get better prices for their produce as the Capital Markets Authority takes over regulation of trading in the commodity - The Capital Markets (Commodities Markets) Regulations 2020 will facilitate the licensing of commodity exchanges, commodity brokers and approval of clearing houses. The regulations further provide for the governance, trading and conduct of business of commodity exchanges and commodity brokers, including the disclosure, compliance and reporting requirements.  Confirming the new development, the Capital Markets Authority (CMA) Acting Chief Executive, Wyckliffe Shamiah said: “The regulations were developed after a comprehensive consultation process including: benchmarking with regional and international jurisdictions; expert review by consultants commissioned by the State Department for Trade and the Capital Markets Authority (CMA) as well as extensive stakeholder engagement at the County, National and Parliamentary levels.”    “In order to address historical and market structure challenges in the coffee sub-sector, the Coffee Sub-Sector reforms Implementation Committee (CSIC), where CMA is a member, developed the Capital Markets (Coffee Exchange) Regulations 2020 for the sector to reinforce successful reform initiatives for the Coffee Exchange anchored in a legal framework,” Shamiah expounded. The Capital Markets (Coffee Exchange) Regulations 2020 provide for; incorporation of the coffee exchange; licensing of brokers; establishment and operationalization of a direct settlement system for expedited and transparent payment of coffee sales proceeds; conducting of trading in a secure, stable and transparent manner in an environment of fair competition; and protection of the interests of the grower, the buyer and other stakeholders at an exchange.  “The need to develop structured mechanisms for commodities trading in Kenya is supported by the recognition that smallholder farmers face several challenges due to market inefficiencies manifested in the form of supply chain inadequacies, constrained access to credit, inefficient price discovery, volatility and poor market access which leads to high production and marketing costs. (Capital Business)

Key Words: Kenya, Coffee sector, Trade

WEST AFRICA

The ECA and the ECOWAS join forces to strengthen the Commission's leadership and management capacities for development – The United Nations Economic Commission for Africa (ECA), through its Sub-Regional Office for West Africa, and the Commission of the Economic Community of West African States (ECOWAS) are paving the way for close collaboration to strengthen the ECOWAS Commission's leadership and management capacities for development. Through a technical Memorandum of Understanding that was renewed in June 2017, the two institutions have made a formal commitment to pool their efforts to strengthen the process of sub-regional integration in general, and the implementation of the ECOWAS Vision 2020 in particular. This Memorandum aimed to define a general framework for cooperation in order to allow the ECOWAS and the ECA to engage in mutually beneficial activities, such as information sharing, consultations and knowledge sharing. This Memorandum also provides for coordination and collaboration on projects, studies and research in areas of common interest to the two institutions and for the improvement of the living conditions of the peoples of the Community. In accordance with the Memorandum of Understanding, cooperation between the two institutions focuses mainly on the ECOWAS strategic pillars and objectives presented in Vision 2020, the implementation of which has been undertaken mainly through the 2011-2015 Regional Strategic Plan and the 2016-2020 Community Development Programme. Priority areas for intervention, such as strengthening the institutional capacities of the ECOWAS Commission, monitoring economic and monetary integration in West Africa, supporting the ECOWAS Commission to establish consensus and develop advocacy on policies for regional integration, are targeted in particular. It is within the framework of this Memorandum of Understanding that the ECOWAS Commission requested and obtained the support of the ECA for the capacity strengthening of its Strategic Planning Directorate, for the final, independent evaluation of its Vision 2020 that is coming to an end, and for the development of its new Vision 2050 and its first medium-term strategic framework for the implementation and development of a macro-economic model for the sub-region.  (UNECA)

Key Words: ECA, ECOWAS, Regional Integration

How NPA Is Minimizing Impact of Covid-19 on Nigerian Economy - While the world was struggling to contain the spread of the virus and consequently shutting down ports, Nigeria took the bold decision to keep its seaports open for business. The government knew the importance of seaports to its economy as an import-dependent country. However, opening the ports posed a huge threat. As a way out, the Managing Director of the Nigerian Ports Authority (NPA), Hadiza Bala-Usman, came up with what has now been described by experts as a brilliant idea in the fight against Covid-19. On March 9, 2020, at a sensitization programme for terminal operators, shipping companies and dockworkers at the Lagos ports complex in Apapa, Bala-Usman announced that the NPA had found a solution that will keep the port safe and running. She revealed that in the wake of the pandemic, the NPA placed vessels coming into the country from Asia on red alert, due to the high rate of infection from the region. As a further measure, she said the NPA agreed with shipping companies to divert vessels whose crew members are showing symptoms of the virus from Mauritius. Similarly, personnel from the Port Health were on the ground to avoid the spread of the virus through the ports and the NPA boss rallied for the support of all stakeholders to forestall the spread of the virus at the nation’s seaport. According to her, the authority has commenced a plan to set up isolation centres at the ports to curb the spread of the coronavirus from the seaport. “We are aware that the virus is spreading round the world in a very rapid form and of course there is need for us to curtail it, and we have been informed that there is no cure to this disease and the best thing for us to do is to have a precautionary preventive measure for us to ensure that it does not spread, so on the basis of this we have to call the terminal operators and of course the stakeholders for us to rub minds together and see how best we can do to curtail this menace. “Of course, we have done a lot of things on the part of NPA to ensure we prevent the spread of this disease, as we know the port is one of the entry points into the country, that is why we deem it fit for us to discuss what we have done and of course what is expected of the terminal operators for them to be able to curtail this menace.

Key Words: Nigerian Economy, COVID-19, NPA

SOUTH AFRICA

Coronavirus and freight forwarding in SADC – South Africa is the economic powerhouse in the region. Most countries rely on South Africa, in some way, for their imports. They import goods from South Africa and some import goods from global sources via South African seaports such as Durban. Other countries such as Zimbabwe and Zambia are strategic transiting countries for goods transiting from Durban in South Africa and Beira in Mozambique. Unfortunately, South Africa has been hard hit by the pandemic and this has greatly affected the region. COVID-19 has resulted in a number of countries putting in place measures to contain its spread. These measures include putting controls on ports of entry. For example movement of people across borders has been suspended to a great extent. In many countries only citizens and returning residents are allowed entry while foreigners are required to show cause why then cannot stay in their countries during this period. For example at seaports more stringent procedures have been introduced to screen people and vessels arriving at the ports. In Namibia, the following ports are closed to passengers: Oshikanjo, Katwitwi, Wenera, Buitepos, Ariamsvlei, Noordoewa, Ludentz and Walvis Bay. The same restriction was put in place in other seaports in South Africa and Mozambique. There have also been adjustments in the clearance of commercial traffic with priority now given to clearance of essential commodities such as food stuffs and medicaments. At Beira Port in Mozambique, all vessels are required to send all information required by health authorities in advance of arrival. In Namibia, compliance with self-quarantine requirements was a pre-requisite prior to any vessels being given port clearance to come through to the port. The vessels are also medically screened and cleared by all relevant authorities. In most cases, ports operate with reduced staff and at times resulted in delays.[i] From the seaports, goods are moved by road to landlocked countries such as Zimbabwe, Zambia, Malawi and DRC. Just like seaports and airports, border posts also put systems in place to combat the spread of the coronavirus. This calls for coordinated border management between neighbouring countries. The customs administration in Zimbabwe has activated its risk management system. (tralacBlog)

Key Words: COVID-19, SADC, Markets