ATPC DAILY DIGEST 19 AUGUST 2020
Today’s Topics:
Statement By The Secretary-General H.E. Wamkele Keabetswe Mene Official Commissioning And Handing Over of the African Continental Free Trade Area (Afcfta) Secretariat – (AU)
Digital platforms give lifeline to Kenya’s creatives amid COVID-19 – (UNCTAD)
Kenya-U.S. Free Trade Talks Are Under Way - What Nairobi Must Get Right From Start – (The Conversation Africa)
Minister Urges African Countries to Harness Benefits of AfCFTA – (Ghanaian Times)
H.E. President Nyusi of Mozambique takes over as Chair of SADC, pledging to continue advancing the regional development agenda – (SADC)
INTERNATIONAL
WCO Congratulates the African Union and the Government of Ghana for the Official Commissioning and Handover of the AfCFTA Secretariat - On 17 August 2020, at the invitation of the Government of the Republic of Ghana, WCO Secretary General Dr Kunio Mikuriya virtually joined, alongside several African dignitaries, the official commissioning and handing over of the office premises for the Secretariat of the African Continental Free Trade Area (AfCFTA) by the Government of Ghana to the African Union Commission (AUC) in Accra, Ghana. The President of the Republic of Ghana, H.E. Nana Akuffo-Addo, commissioned and handed over the fully furnished AfCFTA Secretariat building and the official residence for the Secretary General of the AfCFTA to the Chairperson of the AUC, H.E. Moussa Faki, during a ceremony that affirmed Ghana’s commitment to host the permanent Secretariat of the AfCFTA in Accra. President Akuffo-Addo stressed the importance of an effective implementation of the AfCFTA in boosting trade amongst African countries and contributing to the desired growth and prosperity on the African continent. The President welcomed the new Secretary General, H.E. Wamkele Mene, to Ghana and urged him to work towards building a strong, efficient, and effective Secretariat, with the capacity to implement the various trade rules in line with the AfCFTA Agreement.
In his speech, H.E. Wamkele Mene noted that the AfCFTA sends a strong signal that Africa is open for business and investments that are mutually beneficial to create decent jobs and improve the livelihoods of African citizens. He acknowledged the negative impact of the COVID-19 pandemic on global supply chains and its effects on the economic progress on the continent but urged Africa to see opportunities from the AfCFTA to reconfigure Africa’s supply chains and expedite the creation of regional value chains that will boost intra African trade and secure productive capacities. He also underlined the importance of Customs in implementing the AfCFTA. (WCO)
Key Words: Global Trade, WCO, AU
Fighting counterfeits at the border: Counterfeit Goods Seizure Act of 2019 would expand CBP enforcement to design patents – The ubiquity of counterfeit goods in global commerce is not a new phenomenon, but in recent years the urgency with which the government has sought to tackle this issue has accelerated dramatically. Recently, as the healthcare system scrambled to respond to the COVID-19 pandemic and economic growth stalled, the seriousness of the commercial and physical injury that imported counterfeit goods can inflict on US citizens became more obvious. The government's fight against counterfeits has recently included ramping up pressure on China and introducing legislation to expand US Customs and Border Protection's (CBP's) IP rights enforcement programme.
The Counterfeit Goods Seizure Act of 2019 (CGSA), which a bipartisan group of senators introduced at the end of 2019, is a significant legislative effort to tackle the problem of imported counterfeit goods. The CGSA would add design patents to the CBP's current IP rights enforcement mechanism for trademarks and copyrights. Based on what is known about the CBP's current IP rights enforcement programme, the CGSA would give US design patent owners relatively faster relief and protection from counterfeit goods, with the same effect as an International Trade Commission (ITC) exclusion order. (Lexology)
Key Words: Global Trade, Investment Policy, Trademark
PAN AFRICA
Africa to learn from Covid-19 and build more competitive and resilient regional value chains through the AfCFTA – The Africa Trade Policy Centre (ATPC) of the United Nations Economic Commission for Africa (ECA) in collaboration with the UK-based Overseas Development Institute (ODI) released a working paper entitled “Africa trade and Covid‑19: The supply chain dimension”. The paper investigates the impacts of the pandemic on trade and value chains in Africa, with a special focus on Ethiopia and Kenya, and the pharmaceutical sector. It also makes specific policy recommendations on how the African Continental Free Trade Area (AfCFTA) can be reconfigured to reflect the new realities and risks of the 21st century. Mr. David Luke, Coordinator of ATPC, commenting on the report, noted that the nowcast for Africa is clear, but the forecast for growth and trade this year remains uncertain. COVID-19 has magnified Africa’s cross-border trade challenges, and endemic reliance on imports of essential food and medical products. Implementation of the AfCFTA must be fast tracked to help African countries bounce back from the pandemic and facilitate the emergence of robust and resilient African supply chains.
Covid-19 has created significant disruptions to global value chains, through lockdown induced contractions in demand and supply, increased transport and transactions costs in foreign trade and growing use of export bans. Africa has been particularly exposed. About 82 percent and 96 percent of Africa’s imports of food items, and medicinal and pharmaceutical products, respectively, originate from outside the continent. Also problematic has been the shift in the Covid-19 epicentre from China, which accounts for 11 per cent of African exports and 16 percent of imports, to Europe, which accounts for 33 percent of African exports and 32 percent of imports. The leading argument is that the pandemic has strengthened the case for developing intra-African regional value chains and unlocking the continent’s business potential. Food shortages, price hikes and breakdowns in pharmaceutical supply chains are widespread and growing. In Kenya, the tea and cut flower value chains have been severely hit. Restrictions applied to passenger flights across the world have reduced the availability of transport for products such as cut flowers and fresh agricultural products. Ethiopia’s coffee and cut flower supply chains are also being adversely impacted, and the slowdown in international travel has served a significant blow to the travel and transportation services provided by Africa’s most successful air carrier, Ethiopian airlines.
Swift implementation of the AfCFTA Agreement will be crucial to fast track the development of “Made in Africa” brands embedded in competitive and robust regional value chains. The delay to start of trading offers a window of opportunity for creative thinking on how the AfCFTA can be reconfigured to reflect new realities and risks. This is needed to better position the African economy in the face of future adverse shocks emanating from novel viruses and climate change, among others. The pandemic highlights that a robust supplier management system that takes into account sub-tier dependencies and proximity is a prerequisite for today’s supply chain, and in turn the need to utilize the AfCFTA as a springboard for developing Africa’s industrial base. (UNECA)
Words: UNECA, AfCFTA, Regional Integration
Statement By The Secretary-General H.E. Wamkele Keabetswe Mene Official Commissioning And Handing Over of the African Continental Free Trade Area (Afcfta) Secretariat - Extract: On this occasion of the official commissioning and handing over of the AfCFTA Secretariat, let me express deep humility for having been elected by the 33rd Ordinary Session of the Assembly of Heads of States & Government of the AU, to the position of the first Secretary-General of the AfCFTA Secretariat. A mission to be at the services of Africa, which I shall undertake with resolute determination.
Since the end of colonialism, the Republic of Ghana has been at the forefront of advancing efforts for the integration of Africa. Ghana’s contribution to Pan-Africanism ensured that Pan-Africanism has a sound intellectual and philosophical foundation. It is therefore natural that as we take this significant step towards the integration of the market in Africa through the AfCFTA, Ghana continues to be at the vanguard of our efforts. On behalf of all Africans, I thank the government and the people of Ghana, for hosting the AfCFTA Secretariat and for providing world class facilities that will enable Africa to progress on the historic vision of achieving an integrated Africa. The Republic of Ghana and the people of Ghana – at great sacrifice – made an unprecedented contribution to the fight to end colonialism in Africa and the defeat of Apartheid in South Africa. I was born and raised during a period when the depraved Apartheid regime was at its brutality. Through the Organisation of African Unity, which was inspired by the leadership of Ghana, the continent declared that Africa shall not be free until the people of South Africa are free from the shackles and bondage of Apartheid. The fact that a South African who was born and raised under Apartheid, is able to stand before you today, mandated by the Assembly of Heads of States of the AU to advance the imperatives of Pan-Africanism, truly is a remarkable testament to Ghana’s long held principle that Africa shall not be free until the people of South Africa are free from the shackles and bondage of Apartheid. (AU)
Words: AfCFTA, Trade, Regional Integration
Inland Water Transport System and Regional Connectivity In Liberia: A Potential Driver for Economic Growth- Drawing From The Experiences of Tanzania, Uganda and Egypt – Governments and donors in Sub-Saharan Africa have devoted considerable resources to the construction and rehabilitation of roads. An emphasis on transport infrastructure is evident in the lending pattern of the World Bank, which commits a larger share of resources to transport infrastructure than education, health, and social services combined (World Bank 2007). Total transport commitments in the fiscal year 2013 amounted to US$5.9 billion and rural and inter-urban roads remained the largest sub-sector with 60 percent of lending in FY13 US$3.2 billion (World Bank 2014). Africa has the lowest density of roads in the world, with 204 kilometers of road per 1,000 square km, nearly one-fifth the world average, and less than 30% of the next worst region, South Asia.
Starting from such a low base, the potential for growth due to improvements in transportation infrastructure is presumed to be especially large in Africa with a focus on inland water transport infrastructures. Given the significant investment in the transport infrastructures across Africa by governments and development institutions, governments in Sub-Sahara Africa have got to include an intriguing innovation to the debates about transport networks’ contributions to economic growth. It is worth noting that transport networks, though expensive, facilitate the creation of and the participation in, markets and are deemed to be central to development. Supports to such sectors seek to have ripple effects on economic growth and development; thus creating accessibility to farms and marketplaces, enhancing local productivity, regional trade and commerce, and sustained economic growth. The rationale behind these investments is self-evident and a path to sustainable development. However, one significant sector that must be considerably harnessed is the inland water transport networks which facilitate regional connectivity, supply chain management, and logistics and fast-moving regional trades in Sub-Saharan Africa.
The article reveals the author’s unforgettable experience during his academic tours in East Africa with a focus on Tanzania, Uganda, Kenya, and Egypt respectively. In these regions, governments have utilized the potential impacts of transportation industries with a focus on improving trades and connectivity. These evidence-based experiences will give an informed understanding to stakeholders of the transport sector and the Government of Liberia in particular, in terms of creating innovative ideas to smoothly connect counties and regions across the country as part of its quest to connect the Coastal regions. In Liberia, limited donor finance for road sector reconstruction, rehabilitating heavily deteriorated road networks, establishing sustainable funding for road maintenance, and creating institutional capacity for road networks remains a daunting challenge. Modeling the development frameworks of other progressive countries in Africa remains and is essential to the country’s economic governance. The article therefore looks deeply into the transport industries of Tanzania, Uganda, and Egypt with a focus on inland water transport networks: the Nile River, Lake Victoria, and the Indian Ocean, respectively. (FPA)
Key Words: Africa, Trade, Regional Integration
EAST AFRICA
Digital platforms give lifeline to Kenya’s creatives amid COVID-19 - The Kenyan government released a $1 million stimulus package dedicated to local artists, including musicians. But this is not enough, some say, wanting the government to have a longer-term plan in place. A recent survey conducted by the HEVA Fund, Africa's first dedicated finance, business support and knowledge facility for creative industries, underscored the financial impact of COVID-19 on creative businesses in Kenya. In the survey, 58% of the respondents estimated their income losses to be “severe” and an additional 26% “moderate to severe”. This is a blow to Kenya’s emerging creative industries, which, according to the latest available data from 2013, exports creative goods to the value of at $40.9 million and imports $195 million worth of creative goods, the latest UNCTAD Creative Economy Outlook outlines. As the COVID-19 crisis deepens, the artists are flocking to both well-known and emerging platforms to eke out a living. And while digital solutions cannot replace the value and beauty of a live show, they are helping the artists survive.
This trend is giving fresh impetus to e-commerce channels and platforms for creatives. It has led the government to request UNCTAD to help address key e-commerce gaps limiting the uptake of digital solutions. “COVID19 has seen many creatives turn to digital platforms and technologies to connect with audiences and consumers. They are also looking for ways to monetise the technology,” said UNCTAD’s creative economy programme head, Marisa Henderson. “Given the important role of the digital creative services for creative industries, it’s crucial that countries ready themselves for the ‘new normal’ and adopt digital strategies in line with their development needs.” (UNCTAD)
Key Words: East Africa, Trade, UNCTAD
Kenya-U.S. Free Trade Talks Are Under Way - What Nairobi Must Get Right From Start – The United States and Kenya formally launched negotiations for a free trade agreement on 8 July 2020. With the US gearing up for presidential elections in a few months, these talks may not draw much global attention. But as a prototype for evaluating the substance of future US-Africa trade relations, a lot rides on Washington using this deal to make a bold statement of its commitment to effective North-South free trade agreements. The US is the third most important destination for Kenyan exports after Uganda and Pakistan, accounting for 8% of its total exports. Kenya exported goods worth US$ 527 million in 2018, primarily apparels, coffee and nuts. Its imports were mainly commercial aeroplanes and other spacecraft, polymers and medicaments. Kenya has a slim trade surplus that the US will probably be keen to balance. Washington has a penchant for using free trade agreements to signal the status of partner states as regional strategic allies. Such agreements with Morocco, South Korea, Colombia and Bahrain were all intended to signal much deeper strategic alliances beyond trade.
For the European Union and China the Kenyan agreement further signals America’s intent for commercial expansion and competition in Africa. The principal objective is to secure duty free access for American industrial, apparel and agricultural goods in Africa. Its all about making American exports competitive. US trade officials have described the Kenyan deal as a model for other African free trade deals. Terming Kenya a “strategic partner, regional leader and commercial hub” statementsfrom both the US Trade Representative Robert Lighthizer and the US ambassador to Kenya Kyle McCarter highlight the seriousness with which Washington wants this deal done. This vigour affirms President Trump’s strategy outlined by the 2018 US-Africa policy. But since the Kenyan deal is an initiative of President Trump, the palpable pressure to conclude agreement could be detrimental to Kenya’s interests. The pressure hampers Kenya more given the asymmetry of capacity between the two states. Free trade agreements are protracted affairs which take more than a year to complete. The US-Morocco agreement, for instance, took 15 months. Talks with Peru (18 months) and Colombia (20 months) lasted even longer. The Kenya-EU economic partnership agreements took more than 10 years to conclude. (The Conversation Africa)
Key Words: East Africa, Trade, UNCTAD
WEST AFRICA
Address by the President of the Republic of Ghana, Nana Addo Dankwa Akufo-Addo, at the Commissioning and Formal Handing Over of the African Continental Free Trade Area Secretariat Building, in Accra, to the African Union Commission – Extract: I welcome all who are coming from beyond our shores to our picturesque, vibrant capital city of Accra, particularly the Chairperson of the African Union Commission, His Excellency Moussa Faki Mahamat. We are honoured, Sir, by your presence amongst us. I extend a hearty akwaaba, our word of welcome, to you and all others, and I hope you are all enjoying your stay, the pandemic notwithstanding, amongst a people famed for their hospitality. When the African Union (AU) convened an Extraordinary Summit in Kigali, the capital of the Republic of Rwanda, on 21st March, 2018, to adopt and sign the legal instruments for the establishment of the African Continental Free Trade Area (AfCFTA), there were many who did not believe African countries were ready to meet the required minimum threshold of twenty-two (22) Member-State-ratifications needed for the AfCFTA to come into effect.
On 30th May 2019, a year later, after the minimum threshold was met, with Ghana and Kenya being the first to deposit, on the same day, their instruments of ratification with the AU Commission, the operational phase of the AfCFTA was launched, as the Agreement had become effective. A little over a month after this seminal event, we gathered in Niamey, capital of the Republic of Niger, on 7th July 2019, at the 12 th Extraordinary Session of the Assembly of Heads of State and Government of the AU, where Ghana was selected by her peers to play host to the Secretariat of the African Continental Free Trade Area.
Indeed, for a country generally acknowledged as the pioneer of modern pan-Africanism under the dynamic leadership of our first President, Kwame Nkrumah, a country whose people made great sacrifices to spearhead the struggle for the liberation of the African continent from colonialism, imperialism and the racist system of apartheid, this is the first time, in our sixty-three (63) years of nationhood and in the fifty-seven years of the founding of the Organisation of African Unity (OAU), the precursor to the AU, that we have the responsibility and privilege of hosting an important pan-African institution. So, today is an auspicious day for Ghana, and, on behalf of the Ghanaian people and their Government, I express our deep appreciation, once again, to the Assembly of Heads of State and Government of the AU for its decision. (AU)
Key Words: AU, Regional Integration, West Africa
Minister Urges African Countries to Harness Benefits of AfCFTA – The Minister of Trade and Industry, Mr Alan Kwadwo Kyerematen has urged African countries to develop a national programme of action to harness the benefits of the African Continental Free Trade Area (AfCFTA), which kick-starts on January 1, 2021. According to him, even though the AfCFTA promises a lot of benefits, it would require the efforts of the individual member states to harness these benefits, stressing that "Whilst acknowledging the benefits to be gained from the AfCFTA, it is worth noting that these benefits will not accrue automatically." Mr Kyerematen made the call at the official inauguration and handing over of the AfCTA secretariat in Accra, yesterday. The secretariat is expected to commence operations ahead of the official implementation of the AfCFTA agreement in January, 2021. The minister explained that the successful implementation of the initiative would bring many benefits to the continent, which included increase in the level of intra African trade through better harmonisation and coordination of trade within the continent.
"It is estimated that intra African trade will increase by as much as 35 billion US dollars per annum or 52 per cent by 2022. Secondly, it will address the challenge of small fragmented markets in Africa by creating a single continental market which will lead to economies of scale," he added. Mr Kyerematen said the operationalisation of AfCFTA would add value to Africa's abundant natural resources and promote economic diversification and industrialisation, in addition to promoting the development of regional value chains and facilitate cross border investments in Africa. He said "it will open up market access opportunities for SMEs in Africa on preferential trade terms. With a population of 1.2 billion, estimated to reach 2.5 billion by 2050, Africa will become a very attractive destination for Foreign Direct Investment because of its market size, with the potential for joint ventures and enhanced local content," he emphasised. (Ghanaian Times)
Key Words: AU, Regional Integration, West Africa
SOUTHERN AFRICA
H.E. President Nyusi of Mozambique takes over as Chair of SADC, pledging to continue advancing the regional development agenda – It has been 40 years since our Organization was established in Lusaka, Zambia, in 1980; and exactly 28 years since the transformation of the Southern African Development Coordination Conference (SADCC) into the Southern African Development Community (SADC) in Windhoek, Namibia, in 1992. I, therefore, would like, as Chair of SADC, to extend warm greetings and congratulations to all SADC citizens on this Special Day for our Community. In the same vein, I take the opportunity to pay a well-deserved tribute to our Founding Fathers, who took the historic stride to form this noble Organization in order to serve as the vanguard of our aspirations for freedom, unity and solidarity. Indeed, without their vision and solidarity this day would have not been possible.
It is unfortunate that, today, not many of our Founding Fathers are still alive. In September last year, we lost one of our few remaining Founding Fathers of this Community, the Late Comrade Robert Mugabe, former President of the Republic of Zimbabwe. Once again, on behalf of the SADC, I extend my most sincere condolences to the Government and People of the Republic of Zimbabwe for this great loss. In this connection, I would like to take this opportunity to inform you that, this year, on 14thOctober, Tanzania will mark 21years since the demise of yet another Founding Father of this Organization, who was also the Father of our Nation, the Late Mwalimu Julius Kambarage Nyerere; and on the 13thApril 2022, we will celebrate the centenary of his birth.
We, therefore, invite all Member States and all well-wishers to join us in remembering Mwalimu Nyerere and celebrating his legacy. Needless to say, the late Baba wa Taifa was a true son of Africa who left a formidable legacy not only for our region but also the continent in general. (SADC)
Key Words: SADC, trade, Regional Integration
Statement Delivered on Behalf of the AU Chairperson, President Cyril Ramaphosa on the occasion of the handover ceremony of the AfCFTA Secretaria – The statement reads as follows: “Excellences, allow me to first congratulate the President of Ghana, H.E. Nana Akufo-Addo, for hosting the AfCFTA Headquarters as well as Mr Wamkele Mene on his inauguration, which took place in Addis Ababa, on 19 March 2020. On behalf of the African Union and the entire Continent, I express our profound gratitude to the Government and people of Ghana for generously offering the building and residences, which house the AfCFTA. This day is indeed a milestone and a strong affirmation of the vision of an integrated Africa, which was envisioned by the founding fathers of the OAU, including Kwame Nkrumah, 57 years ago. It is a fitting tribute that the AfCFTA Headquarters are being housed in Ghana. I want to reassure you, Mr Mene of the Chair’s unwavering support, as you execute your responsibilities of promoting the successful implementation of the AfCFTA, as entrusted to you by the Continent. Mr Mene, you are facing enormous challenges ahead, but they are not insurmountable. When successfully implemented, the AfCFTA will be a huge milestone towards the realization of Agenda 2063, the Africa We Want. As AU Chair, I also wish to assure you of the AU’s commitment to the successful implementation of the AfCFTA, as a practical contribution to economic development of Africa.
We welcome the progress achieved thus far in the implementation of the Niamey Decision of July 2019, but we also acknowledge the challenges that still exist in the negotiations at the moment, in particular around the issue of Rules of Origin and Trade offers, as well as trade in services. We are confident that, through your leadership and the determination of the AU Member States, all bracketed issues should be resolved. We remain concerned about the impact of the global pandemic caused by the COVID-19 virus on the Continent, which resulted in thousands of fatalities. The COVID-19 pandemic arrived at a moment when prospects for many African countries were promising. At the beginning of 2020, Africa was on track to continue its economic expansion, with growth projected to rise from 2.9 per cent in 2019 to 3.2 per cent in 2020, and 3.5 per cent in 2021. It is also equally important to state that important gains are being registered in poverty reduction and health indicators. We are witnessing unprecedented embracing of technology and innovation across the Continent, with young Africans acting as early adopters of new platforms, such as mobile money.(AU)
Key Words: AU, trade, Regional Integration
