IMPORTANT ANNOUNCEMENT

Second survey on COVID-19 pandemic and its economic impact on African countries : Survey extended until 20 July - The United Nations Economic Commission for Africa (ECA) and International Economics Consulting Ltd teamed up in April 2020, in order to carry out the first survey and provide insights into the economic effects of the pandemic on economic activity and trade for businesses across Africa. The analysis and full report has been published and can be accessed here.

Based on the positive responses of the April Survey, and with a view to shedding light on the policy responses and understanding how businesses are progressing during the pandemic, the team is proposing a second round of the survey. Please also note that the scope of the questionnaire has been slightly expanded (compared to the first round) to account for issues that are gaining even more importance in the context of the pandemic and relating to supply chains, technology, competition and gender.

This survey should take 15 minutes to complete, and please rest assured all responses will remain strictly confidential. Please click on the link below to begin the survey, the deadline for completing the survey is Monday 20 July. 

https://www.surveymonkey.com/r/Covid-19-Africa-Impact

Thank you very much for giving your time to help us with our research. If you have any queries or comments about the survey or the research study, please do not hesitate to contact us by mail eca-atpc@un.org.  

INTERNATIONAL

The UK and Sub-Saharan Africa: prosperity, peace and development co-operation – Sub-Saharan Africa is a region of 49 countries of immense complexity and diversity. In the next 30 years to 2050 it will see unprecedented social and economic changes, some of which present enormous economic and social opportunities. Others create challenges which could be overwhelming for some individual nations. The African Union (AU) has developed a long-term strategy to meet these challenges and to harness the opportunities. The UK should take a greater interest in, and seek a stronger partnership with, Sub-Saharan Africa to support the delivery of the AU’s long term strategy. Sub-Saharan Africa is a region with some of the fastest growing economies in the world.1 Africa’s population is expected to double to 2.1 billion by 2050; this growth is resulting in a rapidly expanding middle class, and a growing proportion of young people across the continent. Africa is the biggest bloc at the United Nations (UN) and the AU is growing in significance. Therefore, it is of strategic and geopolitical importance to the UK. It is a region where the UK really can make a difference. Successive governments have said that Africa should be given a higher priority across Whitehall, but have failed to make this a reality in the face of competing demands.During her visit to Cape Town in September 2018, the then Prime Minister, Theresa May MP, announced a “fundamental strategic shift” in the UK’s engagement with the countries of Africa, known as the ‘strategic approach’. We welcome the ‘uplift’ of staff in the region that followed the announcement, but are disappointed to conclude that the Government’s ‘strategic approach’ to Africa falls short—it is not a strategy, but rather some broad ideas and themes.

The Government should publish a clearly articulated list of its priorities for its engagement with Africa, and an action plan for meeting them. The context of the UK’s departure from the European Union (EU), and the Integrated Review of foreign policy, defence, security and international development, present a timely opportunity for a renewal of the UK’s engagement in Africa.During the course of our inquiry, it became clear that aspects of the UK’s domestic policy have a direct impact on its reputation in Africa. We received overwhelming evidence that the UK’s visa policies are damaging its reputation, and we recommend that the Home Office should urgently review the UK’s approach to the issuing of visas for people from Africa. We also heard evidence of the lasting impact of the historical legacy of slavery and colonialism on perceptions of the UK in the region. It is necessary to address appropriately both the treatment of black people in the UK, and this historical legacy, including through fostering better knowledge among UK citizens.

We were struck by evidence that remittances from the UK to Sub-Saharan Africa exceed aid and charitable giving. Remittances are given too little profile in the narrative of the UK’s economic relationship with Sub-Saharan Africa, and the Government should work to lower the cost of remitting money to the region. We also urge the Government to embed consultation with diaspora communities into policy making. It is already clear that the impact on Africa of COVID-19, both in health and economic terms, will be very damaging. This adds urgency and scale to the collective responses to the challenges we identify in this report, which focuses principally on Sub-Saharan Africa. Significant economic support from international partners will be needed to prevent economic gains over the last two decades being reversed. In particular, the Government should support the AU’s call for a two-year standstill for African countries’ public and private debt, and continue to work with international partners to ensure that any COVID-19 vaccine that is developed is made available to developing countries, including those in Sub-Saharan Africa.We conclude that the UK’s future relationship with the countries of Africa and their regional institutions needs to be based, as has not always been the case in the past, on a genuine partnership. The UK should continue to support constructive reforms to the rules-based international order, including the UN Security Council, to provide African countries with a voice commensurate with their size and importance. We also welcome the Government’s support for the use of UN-assessed contributions to fund AU-led peacekeeping missions. The reboot of the UK-AU relationship through the Memorandum of Understanding, signed in 2019, provides further opportunities for co-operation. The cultural, educational, language and other soft power connections of the Commonwealth provide a substantial basis for a further strengthening of the UK’s ties. We believe the Government should work with the 19 African members of the Commonwealth to seek ways in which its work in the continent could be strengthened. (UK Parliament)

Key Words: COVID-19, Trade, Commonwealth

The Potential Impact of COVID-19 on Commonwealth Trade, Recovery and Resilience - The COVID-19 pandemic is having an unprecedented impact on global economies, businesses, governments and society. There are now more than ten million coronavirus cases globally and over 500,000 deaths.2 While it is too early to comprehend the full economic implications, especially given the uncertainties surrounding the duration of the outbreak and the risk of a second wave of infection, as well as progress on the development of a vaccine, few question the scale of the challenge ahead. The International Monetary Fund (IMF) projects global gross domestic product (GDP) to decline by 4.9 per cent in 2020 (lower than the 3 per cent fall it predicted in April 2020), with advanced economies estimated to lose by as much as 8 per cent (IMF, 2020b). The poor outlook for the global economy means only 39 countries out of 190 are expected to have positive GDP growth in 2020 (and none of them will record a growth rate above 2 per cent) (IMF, 2020a). To put this into perspective, at the peak of the global financial crisis just over 100 countries had registered positive growth. Global trade is taking a significant hit. The World Trade Organization (WTO) has projected a 12–32 per cent fall in merchandise trade alone, depending on whether the recovery takes a V-shape or an L-shape (WTO, 2020a). Political tensions are escalating trade disputes between the USA and China (and now the USA and the EU). Furthermore, the pandemic is perpetuating an ongoing economic slowdown in China and India, while the proliferation of trade-restrictive measures – including food and medical supplies (Baldwin and Evenett, 2020) – is further depressing the outlook for world trade growth. This widespread downturn means 2011–2020 will be a ‘lost decade’ for global trade at a time when trade is an important means of implementation to achieve the Sustainable Development Goals (SDGs), especially for the world’s poorest countries. COVID-19 may also impair the preparations of least developed countries (LDCs) that are graduating from this category, as well as those to be considered for graduation next year (UNCDP, 2020.)

COVID-19 has had impacts on trade through both supply and demand shocks. Quarantines, lockdowns, social distancing and high levels of uncertainty have caused a significant drop in demand for goods and services, with global value chains (GVCs) transmitting the economic shock to upstream supplier countries. In one estimate, disruptions to the three major GVC hubs – China, the EU and the USA - could result in a US$228 billion decrease in exports across GVCs (Solleder, 2020). Moreover, the policy discourse is shifting from offshoring to localisation of GVCs for some vital sectors.The coronavirus is spreading rapidly in South Asia, Latin America and parts of Africa, while some advanced economies and developing countries, where the virus has already peaked, are grappling with new outbreaks. In many countries, attention is now turning to the post-COVID economic recovery. As countries around the world start relaxing their lockdown measures, many industries and supply chains may seek a quick return to ‘business as usual’. This could involve swiftly trading environmental and social improvements in return for the promise of a strong economic rebound. Yet for many countries business as usual was socially and environmentally harmful, inefficient and inequitable even before the pandemic. There is therefore a persuasive argument that recovery from the COVID-19 pandemic must be based on long-term planning for an inclusive and prosperous strategy that takes all aspects of economic, social and environmental sustainability into account.   (The Common Wealth)

Key Words: COVID-19, Trade, Commonwealth

Ten steps to mainstream gender in trade deals – It's no secret that mainstreaming gender in free trade agreements creates more inclusiveness. Yet most accords don't even mention gender - and those that do, typically fail to offer women the same opportunities as men to participate in trade. The International Trade Centre's new report, Mainstreaming Gender in Free Trade Agreements, addresses this shortfall with 10 key recommendations for the design, content and scope of trade deals. Drafting accords with gender explicit preambles, explicit access to skill development and compulsory dispute settlement mechanisms are among the recommendations in the report, launched at a joint event with the Organization of Women in International Trade. 'This publication answers the call of policymakers and trade negotiators to provide a practical guide to create more inclusive accords,' said Dorothy Tembo, ITC Executive Director a.i. 'Gender mainstreaming ensures that these agreements promote more equitable opportunities rather than perpetuate inequalities.'

More than a quarter of the 292 agreements in force today and notified to the World Trade Organization have at least one provision that explicitly mentions gender. 'The last three years have been phenomenal in this respect,' the report says. This report builds on analysis of 73 trade pacts in Commonwealth countries, and the results are similar.  Just 28% use best practices to mainstream gender concerns, meaning they have considerable scope to improve. Only 5% are advanced, as they use best practices and need little or no upgrade, and 40% make no explicit reference at all to gender considerations. Change is under way, however, as governments increasingly recognize that taking account of the differences between men and women makes good business sense, the report says.

Tools for policymakers, negotiators and researchers  - The most important takeaways from the analysis are summarized in 10 recommendations showing where to embed gender provisions in an accord, what specific actions are needed to create equal opportunities for women and how to ensure that the measures have teeth. Ten model clauses accompany the recommendations, providing ready-made legal language to simplify the work of policymakers and trade negotiators. The report also features a tool that allows policymakers and researchers to track national performance on gender in existing trade agreements, as well as new agreements underway. Among the challenges to mainstreaming gender in trade agreements are a lack of awareness that these accords empower women, and too little data that tracks specifically the impact on women in business. In some cases, the lack of political will or inadequate expertise on gender issues among negotiators is a factor, the report says. 'The impact of gender mainstreaming on women and trade will only become visible with the passage of time,' it says. In the meantime, the guide presented in the report can help countries move in that direction. (ITC)

Key Words: Gender Mainstreaming, Global Trade, FTA

WTO, ICC and B20 call for action to narrow the growing trade finance gap – The joint call for action, which highlights the importance of cross-border trade in driving economic recovery from the downturn caused by the COVID-19 pandemic, has its origins in a WTO Trade Dialogues meeting with the private sector in May, where concerns about trade finance featured prominently. Trade finance is a critical element in re-igniting world-wide growth in imports and exports, the statement reiterates. Since the need for trade finance is estimated to be between USD 2 trillion and USD 5 trillion, meeting this demand and addressing the shortfall will be challenging. There is serious concern that the growing gap between demand and supply will particularly affect micro, small and medium-sized enterprises (MSMEs) and businesses in developing countries, with important implications for jobs and incomes.  

The call to action welcomed a recent joint pledge by the heads of the WTO and six multilateral development banks to monitor and address trade finance gaps, particularly for developing countries and small businesses.  The WTO, the ICC and B20 Saudi Arabia also welcomed the measures taken to stabilize trade finance markets. They urged the private and public sectors to work together to bring about a rapid transition to paperless trading, including e-documents in the processing of trade finance transactions. In addition, the statement called for an exchange of views on how regulatory authorities can help ease constraints on the provision of trade finance. It also proposed increased risk sharing to support trade finance and the extension of development bank schemes to provide risk mitigation.

WTO Director-General Roberto Azevêdo said: “Failing to address the trade finance shortfall will seriously undermine ongoing efforts to give trade the boost it needs to help global economic recovery. I very much welcome the private sector's push to work jointly with the public sector in addressing the gaps. This initiative complements the WTO’s recent initiative, together with multilateral development banks, to highlight the importance of supporting trade finance amid the ongoing health and economic crises.” The joint statement emphasizes that timely interventions are vital to ensure MSMEs in particular have continued access to trade finance as a means of weathering the present crisis. The statement is available here.  (WTO)

Key Words: WTO, ICC, Trade Finance

PAN AFRICA

Commemoration of the first edition of Africa Integration Day: Closing remarks by H.E. Amb Albert M. Muchanga, AU Commissioner for Trade and Industry– We have come to the end of our 1 week commemoration of the first edition of Africa Integration Day, which as you all will agree with me was a big success, considering the COVID-19 Pandemic context in which this took place. Initially planned from 1st to 7th July 2020, the commemoration of the first edition of Africa Integration Day took place from 3 to 9 July 2020, due to some developments in Addis Ababa! What is important is that despite these challenges, we showed resilience and courage, and rose to the challenges. This was a sign that going forward, we have a new mindset; and that is nothing will ever stand on our path towards an integrated, peaceful and prosperous Africa, as envisioned in Agenda 2063: the Africa We Want.

During the 07 day commemoration period, the following were achieved:

1. 10 Panel discussions/debates in the form of webinars, some of which involved former African Heads of State and Government, African Youth, and the African Diaspora and covering a wide range of topics, including post COVID-19, energy, agriculture, creative art, financial institutions. These webinars drew the participation of more than 3000 participants, not including those who followed the commemoration on Youtube and Facebook; with the webinar on the intergenerational dialogue on the role of young people in accelerating Africa’s integration through the AfCFTA attracting 400 participants. It is worth noting the participation of the African Diaspora in the US, Europe and the Caribbean, as exemplified in the rich panel discussion we just had;
2. Showcase and launch of various initiatives and programmes to foster trade and economic integration in Africa, including the Essential Innovation Design Accelerators;
3. The launching and rolling-out of key instruments and tools, which will facilitate trade integration on the continent, including: the AfCFTA Online Non-Tariff Barriers Monitoring, Reporting and Elimination Mechanism; the Launch of the Competition for Youth Start Ups Pavilion at the 2021 Intra-African Trade Fair by H.E. Mr. Issoufou Mahamadou, President of the Republic of Niger and Leader of the AfCFTA, and the launch of the African E-Commerce Platform, whose name is Sukokuo, a Swahili term which means “central market;”
4. The Presentation of Prizes for Africa Creative Arts Challenge organized in collaboration with the AfroChampions;
5. Africa Integration Day Joint Statement by H.E. Mr. Cyril Ramaphosa, President of the Republic of South Africa, Chairperson of the African Union; H.E. Mr. Mahamadou Issoufou, President of the Republic of Niger and Champion of the AfCFTA; and H.E. Mr. Moussa Faki Mahamat, Chairperson of the AU Commission.
6. The other major results was the publication of the Africa Integration Day Brochure.

(tralac)

Key Words: Trade Policy, AU, AfCFTA

Failing Africa’s farmers: New report shows Africa’s Green Revolution is “failing on its own terms” – Fourteen years ago, the Bill and Melinda Gates and Rockefeller foundations launched the Alliance for a Green Revolution in Africa (AGRA) with the goal of bringing Africa its own Green Revolution in agricultural productivity. Armed with high-yield commercial seeds, fertilizers and pesticides, AGRA eventually set the goal to double productivity and incomes by 2020 for 30 million small-scale farming households while reducing food insecurity by half in 20 countries. According to a new report from a broad-based civil society alliance, based partly on my new background paper, AGRA is “failing on its own terms.” There has been no productivity surge. Many climate-resilient, nutritious crops have been displaced by the expansion in supported crops such as maize. Even where maize production has increased, incomes and food security have scarcely improved for AGRA’s supposed beneficiaries, small-scale farming households. The number of undernourished in AGRA’s 13 focus countries has increased 30% during the organization’s well-funded Green Revolution campaign. "The results of the study are devastating for AGRA and the prophets of the Green Revolution," says Jan Urhahn, agricultural expert at the Rosa Luxemburg Stiftung, which funded the research and on July 10 published “False Promises: The Alliance for a Green Revolution in Africa (AGRA).”

A Record of Failure - As I document in my background paper, “Failing Africa’s Farmers: An Impact Assessment of the Alliance for a Green Revolution in Africa,” AGRA has received nearly $1 billion in contributions, the vast majority from the Gates Foundation but with significant contributions from donor governments, including from the United States, United Kingdom, Germany and other countries. AGRA has made over $500 million in grants to promote its vision of a “modernized” African agriculture freed from its limited technology and low yields. The campaign has been fortified with large financial outlays by African governments, much of it in the form of subsidies to farmers to buy the seeds and fertilizers AGRA promotes. These subsidy programs have been estimated to provide as much as $1 billion per year in direct support for such technology adoption. AGRA has been controversial from the start. Many farmers’ groups on the continent actively opposed the initiative, pointing to negative environmental and social impacts of the first Green Revolution in Asia and Latin America. Since AGRA’s founding, scientists and world leaders have gained growing awareness of the limitations of input-intensive agricultural systems, particularly to mitigate and adapt to climate change. The U.N. Intergovernmental Panel on Climate Change in 2019 documented the many ways industrialized agriculture contributes to climate change, calling for profound changes to both mitigate and help farmers adapt to climate disruptions.

Surprisingly, as AGRA reaches its self-declared deadline of 2020, the organization has published no overall evaluation of the impacts of its programs on the number of smallholder households reached, the improvements in their yields and household incomes or their food security, nor does it make reference to its goals or progress in achieving them. Neither has the Bill and Melinda Gates Foundation, which has provided two-thirds of AGRA’s funding. This lack of accountability represents a serious oversight problem for a program that has both consumed so much in the way of resources and driven the region’s agricultural development policies with its narrative of technology-driven, input-intensive agricultural development. (IATP)

Key Words: Africa’s Green Revolution, Economic Growth, Market Economy

NORTH AFRICA

Mauritania strategy for growth and shared prosperity: ECA supports pilot project for the Hodh Chargui region – The ECA Office for North Africa, the Ministry of Economy and Industry, the Ministry of the Interior and Decentralization and the Wilaya of Hodh Charghi of the Islamic Republic of Mauritania on Friday 26 June an online workshop to initiate the design of the Accelerated Regional Growth Strategy and Shared Prosperity (SCRAPP) for the Hodh Chargui region. Hodh Chargui is a region of Mauritania near the border with Mali, well known for its economic and demographic potentials.

A regional variation of the National Strategy for Accelerated Growth and Shared Prosperity (SCAPP, 2016-2030), the Hodh Chargui SCRAPP will be designed as part of a pilot project developed with UN support. The project aims to provide the region with a decentralized planning model that will facilitate the implementation of national development goals, SDGs and Agenda 2063 objectives at the regional level. “Our region is one of the largest, most populous in Mauritania, but also the farthest from Nouakchott. It is exposed to the security challenges and receives the largest number of Malian refugees in the country, about 50,000 to 70,000 people. This situation leads to additional pressures on local resources, especially on the pastoral level, however, this region also has many other potentials that we intend to develop, and we are looking forward to having an integrated vision of the region’s development, " said Mr. Cheikh Ould Abdallahi Ould Ewah, Wali of Hodh Chargui

"Hodh Charghi was selected to become a pilot region for the SCRAPP implementation, to facilitate the implementation of a model that can be extended to other regions of Mauritania, hence the need to give this project a participatory and inclusive dimension”, said Mr. Abass Sylla, Director General of Development Policies and Strategies at the Mauritanian Ministry of Economy and Industry, who stressed the need to effectively involve in this project all stakeholders that can facilitate the SCRAPP implementation, including the Regional Council, administrative services, mayors, technical partners, young people and women; while taking into account COVID19 constraints. "This project is important for the implementation of sustainable development in Mauritania," said Khaled Hussein, acting director of the ECA office in North Africa who expressed the wish for initial results to be available for study next September. "We hope to help Hodh Charghi attract investment in various sectors, and create jobs for its youths," he added. Hussein added that this project comes in the wake of several collaboration programs carried out by ECA in partnership with the Mauritanian authorities in areas such as the African Continental Free Trade Agreement (AfCFTA) and the development of a macroeconomic model for the evaluation of development policies.

This project is being launched as Mauritania’s new law on regions grants them extended powers to plan their own economic, social, cultural and scientific development, with a view to making planning closer to local needs and facilitating the involvement of local populations and authorities in the design, implementation and monitoring of development policies in their regions. (UNECA)

Key Words: AfCFTA, North Africa, UNECA

EAST AFRICA

The impact of the COVID-19 crisis on trade: Recent evidence from East Africa – his paper uses Kenyan trade data published up through May 2020 to provide a preliminary evaluation of the impact of the COVID-19 crisis on regional trade in the East African Community (EAC). Paradoxically, given the prevailing pessimism surrounding the prospects for global trade, Kenya actually experienced a significant improvement in exports in the first quarter of the year, together with a moderation of imports, leading to a marked decline in the trade deficit. While the initial shock to Kenyan trade caused by the COVID-19 crisis initially looked dramatic in terms of the declines registered, this paper reveals that i) the shock is not so alarming when seasonality is taken into account; ii) re-exports and imports have been the primary foci of impact; and iii) domestic exports have actually performed extraordinarily well under the circumstances, with incremental growth since 2019.  Notably, not all supply chains were disrupted by the crisis, with some Kenyan exports like tea and fruit surpassing levels of years past. Rather, imports have been the principle victim of the crisis, declining by a quarter over the three months since the crisis began (between March and May 2020). Capital goods imports have declined markedly—a trend which, if sustained, could have implications for long-term economic growth. However, the fall in imports of consumer goods could also set the scene for a revitalization of national and regional industry, as local producers step up to fill the void created by the sharp lull in imports.

At the same time, Kenya’s EAC neighbors—especially the landlocked countries—may not be so lucky in terms of the overall trade impact: The figures for Kenyan re-exports and intra-regional exports suggest a concerning scale of disruption to intra-regional commerce. Considering Kenya’s leading role in intra-EAC trade, these trends are worrisome. In sum, a coordinated EAC-wide approach is critical for intra-regional trade to remain buoyant in these challenging times and for ensuring vulnerable countries are cushioned from the COVID-19 crisis fallout. Against this backdrop, the urgency of implementing the African Continental Free Trade Agreement (AfCFTA) is even more palpable. Its rapid implementation, accompanied by additional trade facilitation measures, could significantly mitigate COVID-19’s negative impact on the continent’s economy. (Brookings)

Key Words: COVID-19, East Africa Regional Trade, AfCFTA

Digital technology re-opening Africa – To restart travel and trade amid the Covid-19 pandemic, all countries around the world face the same challenge of protecting their populations’ health while reopening borders. Each border crossing point must ensure travelers do not import a new deadly wave of the virus. In East Africa, we saw the logistical challenge of this with kilometers of truck drivers backed up along our borders as they waited for hours to get test results. The East African Community partner states responded promptly by equipping and certifying more laboratories to test travellers and share results electronically with border control and law enforcement. The Regional Electronic Cargo and Driver Tracking System worked off an app and used GPS for real time monitoring of driver compliance to health measures. Supported by TradeMark East Africa, this was the fastest co-ordinated change of border protocols accomplished in the history of East Africa.

 Our next challenge is to safely reopen our land, sea and air border crossings. It is widely expected that all countries will initially require travellers to have a recent negative Covid-19 test in order to ensure that they do not spread the infection during the journey and at their destination. To achieve this, we need people to show Covid-19 test results from a certified lab in a way that cannot be falsified or counterfeited. Even as they share this highly personal health information, we want to preserve their personal privacy. To address the challenge, the East African Community is working with The Commons Project, a Swiss-based non-profit public trust that builds digital services for public good. Using an app called CommonPass, travellers will share their recent test in a way that ensures authenticity of results and the privacy of the traveller.

CommonPass is being implemented through a collaborative design sprint that starts on July 9 with national, regional and global stakeholders that include the design firm IDEO and The World Economic Forum, with the support of the Rockefeller Foundation. Travellers begin their journey using CommonPass by taking an accredited lab test that can be shared electronically to their mobile phone. That certificate is a digital analogue to the widely used “yellow card”, an international certificate of vaccination. This digital health passport will start with lab results, but eventually include vaccination records when a Covid-19 vaccine becomes available. By using CommonPass, test results and authenticity can be assessed by authorised healthcare, airlines or immigration authorities. A crucial part of the system is the fact that – apart from the specific test result selected by the user – no personal health information ever leaves the traveller’s phone without their consent. The CommonPass initiative builds on work already done by the East African Community, including the CommonHealth Map, which tracks Covid-19 cases across the region, and the coronavirus check risk assessment tool, which is available in Swahili, Kinyarwanda, English, French and many other languages.

Moving forward, our major priority is to ensure that Covid-19 does not disrupt implementation of the African Continental Free Trade Area, which will improve so many lives by removing trade obstacles between 28 African countries. This is a major achievement, which must be protected and progressed further. We may not have a vaccine yet, but East Africa has shown how digital services for public good can combat the pandemic, protect lives and preserve privacy. Opening borders is our next challenge and opportunity.  (The New Times)

Key Words: COVID-19, Africa, AfCFTA

World Bank Country Partnership Framework (CPF) 2021-26 To Support Rwanda’s Strategic Priorities – The World Bank Group Board of Executive Directors today discussed the Rwanda Country Partnership Framework (CPF) for the period 2021-26.  This CPF will guide the Bank Group’s work for the next 6 years supporting the Government of Rwanda’s strategic priorities as laid down in the National Strategy for Transformation. The CPF also supports the recovery from the COVID-19 impacts. The new CPF is underpinned by a Systematic Country Diagnostic (SCD), the World Bank’s comprehensive analysis of opportunities for achieving poverty reduction and shared prosperity in Rwanda as well the challenges that the country faces. It also builds on consultations with a broad range of stakeholders in Rwanda including the government, private sector, civil society, development partners and the academia.

The proposed program of engagement is built around 5 strategic objectives: i) improving human capital; ii) improving conditions for private sector development; iii) expanding access to infrastructure and the digital economy; iv) increasing agricultural productivity and commercialization; and v) intensifying urban agglomeration. “These objectives will be at the heart of the Bank Group’s support for Rwanda under our new Country Partnership Framework. They are crucial steps in Rwanda’s journey towards middle income status by 2035 and thus fully aligned with the Government of Rwanda’s central objectives,” said Yasser El Gammal, World Bank Country Manager for Rwanda. “They are the objectives through which the Bank Group, with its resources and skills will contribute to the reduction of extreme poverty and increase shared prosperity in Rwanda.” The Country Partnership framework also includes the following  cross cutting themes that are of central importance in Rwanda and are corporate priorities for the Bank: i) governance and institutions; ii) gender and development; iii) supporting people with disabilities; and iv) supporting Rwanda to recover from the negative public health and socio-economic impacts of the COVID-19 pandemic.  

Prepared jointly by the International Development Association (IDA), International Finance Corporation (IFC) and the Multilateral Investment Guarantee Agency (MIGA), this CPF represents a shared view of how resources across the entire Bank Group can best support the Government’s effort to achieve its national goals. “The CPF leverages and seeks synergies across the World Bank Group to support private sector led programs to increase competitiveness and to support business growth as well as for activities that promote human capital and making growth more inclusive and sustainable,” said Dan Kasirye, IFC Resident Representative. “IFC will continue to support private sector growth by increasing its competitive capacity and promoting a conducive investment climate to boost shared prosperity.”

The Bank Group's portfolio in Rwanda currently includes 18 national projects and 4 regional operations with a net commitment of about $1.9 billion. Project objectives range from providing access to basic infrastructure and enhancing urban management in selected urban centers, to supporting the strengthening of the social protection system, reducing stunting and providing electricity to rural households. (World Bank)

Key Words: Business Growth, Rwanda, World Bank

Digital technologies could help Uganda’s economy recover faster – Uganda’s real gross domestic product (GDP) growth in 2020 is projected to be between 0.4 and 1.7% compared to 5.6% in 2019, according to the latest edition of the Uganda Economic Update released by the World Bank.  The report, “Digital Solutions In A Time of Crisis”, shows the economy has suffered from the triple shocks of the COVID-19 (coronavirus) related economic and social disruption, a locust invasion and floods. Up to three million Ugandans could fall into poverty due to economic hardship and a lack of alternative means of survival. Global and local restrictions in the movement of people and goods and provision of services to contain the COVID-19 pandemic have resulted in lower consumption, loss of jobs and a 43% reduction in remittances. Due to a sharp drop in tax revenues, Government has also been forced to borrow much more to continue providing services to Ugandans.

Uganda, however, remains at low risk of debt distress based on the April 2020 joint World Bank-IMF debt sustainability analysis. With total debt service (interest and principal due) expected to average around 55 percent of government revenues over the next three years, there is a need to cut back on non-priority spending in order to provide essential public services such as health, education, water and sanitation and electricity. A more widespread pandemic could pose significant risks to the outlook, as well as any further significant locust invasion. Weak economic growth in the post COVID-19 period will continue to reduce overall consumption and commodity demand. In addition, crude oil prices are expected to average $35 per barrel this year and $42 per barrel in 2021. Although this will limit external inflationary pressures for import-dependent Uganda, these prices are below the estimated breakeven price of $60 for oil production in Uganda. This could negatively impact Uganda’s prospects of becoming an oil producer within the next four to five years.

The increased use of digital technologies during the COVID-19 lockdown such as mobile money, on-line shopping, on-line education, digital disease surveillance and monitoring, and dissemination of public health messages shows the great potential to support faster economic recovery and strengthen resilience against similar shocks. “The digital space in Uganda is very innovative – and has quickly adapted during the pandemic. Fintechs have offered payment options, and digital solutions have reinforced and enabled the health sector’s calls to social distance and limit movement and contact. These solutions, if upscaled and developed to their potential would boost the digital economy and maximize its benefits to Ugandans,” said Tony Thompson, World Bank Country Manager for Uganda. (tralac)

Key Words: COVID-19, East Africa, Digital Economy

WEST AFRICA

Monitoring COVID-19 Impact on Nigerian Households- Nigeria was among the first countries in Sub-Saharan Africa to identify COVID-19 (coronavirus) cases and has since implemented strict measures to contain the spread of the virus. At the same time, oil prices plummeted by 60% following the spread of the global pandemic. As the oil sector accounts for the bulk of Nigerian government revenue, this collapse in prices has profound implications for the economy. The federal government is confronted with the simultaneous challenge of combatting the public health crisis of the pandemic alongside trying to bolster a weakening economy. Given the mounting evidence that the social and economic impacts of these twin crises are likely to be significant, the government is ramping up policy interventions that can help mitigate such negative impacts. Alleviating the impacts of the COVID-19 crisis is vital for preventing poverty from deepening and increasing in Nigeria; before the crisis, approximately 4 in 10 Nigerians were living below the national poverty line, and millions more were living just above the poverty line, making them vulnerable to falling back into poverty when shocks occur.

To provide the government with timely evidence to guide the policy response, a new high-frequency survey – the Nigeria COVID-19 National Longitudinal Phone Survey (COVID-19 NLPS) – has been initiated in Nigeria. This survey is being implemented by the National Bureau of Statistics with technical support from the World Bank and is designed to measure and monitor the economic and social impacts of the COVID-19 crisis by tracking households’ welfare and behavior every month over a period of 12 months. The survey has a panel structure, such that it follows a representative sample of Nigerian households to assess how key indicators that may underpin the overall policy response are changing over time. (World Bank)

Key Words: West Africa, World Bank, COVID-19

CENTRAL AFRICA

Free roaming within CEMAC by Jan 2021 is way to go!!! – Member States of the Central African Economic and Monetary Community (CEMAC) have everything to gain in respecting the January 2021 deadline to finally put an end to surcharges on mobile roaming within the zone in order to boost the sub-region’s economic recovery efforts in a post-COVID-19 dispensation, posits the Sub-regional Office for Central Africa of the Economic Commission for Africa (ECA). After nine (09) years of technical work and advocacy on free mobile roaming in Central Africa, in collaboration with the International Telecommunications Union (ITU), ECA officials have welcomed the validation, this year, of the draft Community Regulation relating to roaming and tariffs on mobile electronic communications networks open to the public for the establishment of a CEMAC one network zone.

The validation of said project by CEMAC Ministers of telecommunications responds to the will expressed by CEMAC Heads of State and is reflected in the second operational plan of their Regional Economic Program (PER) 2017-2021, adopted by the Council of Ministers of the Central Africa Economic Union (UEAC) in February 2017 in N'Djamena, namely the establishment of a One Telephone Network zone within the Community. The vision also stemmed from the Brazzaville Declaration of ECCAS ICT Ministers of November 2016 on the effective implementation of a subregional roaming system in close collaboration with ECCAS, ECA, ITU and the Association of telecommunications regulators of Central Africa – ARTAC. According to Mr. Giuseppe Renzo D'Aronco, Economic Affairs Officer at ECA’s Sub-regional Office for Central Africa following up this dossier, "this decisive step that the CEMAC zone has just taken, by opting for community roaming, constitutes a tool of borderless communication and a vector of regional integration.”He says “it is likely to significantly improve the daily life of citizens on the move in the CEMAC area and, consequently, provide an opportunity to strengthen the free movement of people, goods and capital.” The question of eliminating roaming charges (voice and data) for mobile telephony in the CEMAC zone is all the more topical given the ubiquity of alternative communication tools (WhatsApp, Skype, etc.) and the envisaged drop in communication costs in the zone, argues Mr. D'Aronco.

 "The fight against COVID-19 resolutely pushes the digitalization of our world in leaps and bounds, and the economies of our sub-region will more than ever need rapid digital transformation with accessible and affordable quality communication tools to the citizens after this pandemic.” He adds that the drop in costs of mobile telephony services, especially mobile roaming, will play a major role in an economic recovery that will boost productivity and develop various services, to leverage activities of the African continental Free trade Area (AfCFTA).  An increase in the volume of intra-African trade, eased by digitalization, he adds, will speed-up the development of the continent.  (UNECA)

Key Words: Central Africa, AfCFTA, COVID-19

SOUTHERN AFRICA

SADC and Russia meet to discuss support on COVID-19 response and other areas of mutual consent - The Southern African Development Community (SADC) Executive Secretary, Her Excellency Dr. Stergomena Lawrence Tax met with Ambassador Extraordinary and Plenipotentiary of the Russian Federation to the Republic of Botswana and SADC, His Excellency Dr. Victor Ivanovich Sibilev at the SADC Secretariat Head Office in Gaborone, Botswana on 6th July 2020.  Ambassador Sibilev conveyed birthday wishes to H.E. Dr. Tax from Honourable Mr.  Sergey Lavrov, Minister of Foreign Affairs of the Russian Federation, and reaffirmed his commitment to continue strengthening the existing cordial relations between SADC and the Russian Federation. The two parties have in 2018, signed two Memoranda of Understanding on Basic Principles of Relations and Cooperation; and on Defence and Technical Cooperation which are envisaged to enhance socio-economic and cultural cooperation and to strengthen cooperation in the defence technological and technical areas. 

The two parties discussed the COVID-19 situation in their respective jurisdictions, wherein Ambassador Sibilev highlighted that the COVID-19 situation in Russia was improving, with re-opening of the economy and schools. He further highlighted that the Russian Federation could provide support to SADC Member States in the fight against COVID -19, and was already working with the Democratic Republic of Congo (DRC), and the Republics of Malawi and South Africa in the area of Personal Protective Equipment (PPE) such as masks, test kits, disinfectant wipes and some medical equipment. To this end, Ambassador Sibilev presented a proposal from the Russian Federation Ministry of Industry and Trade, regarding the availability of PPE and other medical equipment to help the region in the fight against the COVID-19 pandemic from Russian manufacturers.

Dr. Tax thanked Honourable Lavrov and Ambassador Sibilev on behalf of the Russian Federation for the well-thought birthday wishes. She stated that the Russian Federation remains a strategic partner to SADC and the African continent. She further expressed SADC’s gratitude to the Russian Federation for support granted to SADC Member States in the fight against COVID-19, and highlighted that SADC Member States have put in place a number of measures in the fight against the pandemic, and to cushion its socio-economic impacts. She also indicated that in collaboration with Member States and other partners, the SADC Secretariat has taken a coordinated regional approach to contain the spread of COVID-19 across the region, and to mitigate the pandemic’s social and economic impacts on SADC.

The SADC Executive Secretary embraced the offer from the Russian Federation on the availability of PPE from Russian manufacturers, and underscored that the offer was consistent with the recent SADC Council of Ministers decision mandating the SADC Secretariat to negotiate with Governments hosting manufacturing companies, for preferential dispensation to SADC Region for the supply of essential medicine and equipment required for COVID-19, and assured the Ambassador that the offer will be submitted for Member States consideration. (SADC)

Key Words: SADC, Trade Agreement, COVID-19