Today’s Topics:

African businesses shifting towards new technologies in response to COVID-19 pandemic – (UNECA)

India explores defence exports to Africa, focus on making India resilient for business opportunities – (Financial Express)

COVID-19 pandemic accelerated shift to e-commerce by 5 years, new report says – (WeForum)

Oil-backed trade group is lobbying the Trump administration to push plastics across Africa – (Unearthed)

US steps up pressure on France, Germany in Airbus dispute with extra tariffs on other goods – (ST)

Africa Trade Pact’s Architects Seek to Help Offset Tariff Losses – (Bloomberg)

COMESA, AU, SADC Engage Youth on Silencing the Guns – (COMESA)

The Missing Links in Africa’s Ports Connectivity – (The Maritime Executive)

4th High-Level Tax Policy Dialogue: Taxing rights for Africa in the new world and effects of COVID-19 – The role of tax policymakers and tax administrators – (tralac)

EAC in race against time for post-Brexit deal with UK – (Ventures)

SGR is the road of friendship and prosperity for Sino-Kenyan ties – (The Star)

Côte d’Ivoire approves €400m project to create West African port hub – (Hellenic Shipping News)

New ‘single channel’ service created to help resolve barriers to South African exports – (Engineering News)

Zimbabwe, Botswana plan seamless border services – (The Chronicle)

Stricter cryptocurrency taxes are on the way in South Africa – (Business Tech)

IMPORTANT ANNOUNCEMENT

African businesses shifting towards new technologies in response to COVID-19 pandemic – The Economic Commission for Africa, jointly with International Economics Consulting Ltd, released the report of the second comprehensive survey on the COVID-19 pandemic and its economic impact across Africa. The online survey was conducted from 16 June to 20 July to provide insights into the effects of the pandemic on economic activity for businesses across Africa, identifying the challenges they face as well as their responses.

The results of the survey show that the top three challenges faced by companies are: a) reduced opportunities to meet new customers; b) drop in demand, and; c) lack of cash flow. Companies have faced serious disruptions in both supply and market due to COVID-19, with unfair pricing seen as a major concern. Feedback from companies about government assistance is mixed with nearly two-thirds of the respondents indicating from moderate to no satisfaction. As a consequence, 50% of the respondents approached financial institutions from which 25% got positive responses; among the latter, 42% were not satisfied with the service due to high interest rates, delays and/or collateral requirements.

When it comes to their performance, companies are currently working at about half their capacity. Company revenues are expected to drop by about 18% in 2020 (as compared to 2019) and lay-offs to increase by 20% in the next three months. Still, the situation could have been worse if a significant share of employees (27%) had not been able to work remotely. It is worth noting that remote working options proved more challenging for Micro, Small and Medium Enterprises (MSMEs), particularly those dealing with goods, whose performance has been relatively more negatively affected than larger-sized companies and more generally those involved in services. Moreover, women are more at risk of being laid-off than men, which is consistent with the fact that, from interviewed companies, women tend to be employed more in MSMEs in which their primary business is related to goods. (UNECA)

Key Words: UNECA, COVID-19, Business

INTERNATIONAL

India explores defence exports to Africa, focus on making India resilient for business opportunities – India-Africa trade having multiplied and diversified in the last 16 years, the focus is on making India resilient for business opportunities in Africa. Speaking at the webinar on `Making Africa Resilient for Indian Business’, organized by industry body FICCI, Rahul Chhabra, Secretary, Economic Relations, Ministry of External Affairs (MEA), has said, “The Free Trade Agreement has been negotiated within Africa and it is just a matter of time before it will be implemented and it will be a game-changer.” Once the FTA is in place, it will open great opportunities for those Indian businesses who are desirous of setting up their base there. “India could play by working on the entire business value chain, covering aspects like capacity building, training and aligning with the strategies the industry is chalking out, for enhancing India’s presence in Africa,” he said. Mentioning Prime Minister’s 10 guiding principles for deepening India’s engagement with Africa, which will help in Africa’s economic growth, according to him “India’s partnership with Africa is based on a model of cooperation, which is responsive to the needs of African countries and India is ranked as the third-largest export destination in Africa.”

Importance of Trade Agreements - Speaking on condition of anonymity, a top diplomat said “A Comprehensive Economic Partnership Agreement can be a game changer but we should make it truly partnership based without preaching Africa that it is to their benefits. We must believe that African people can see the benefits and we should focus comprehensively on creating win-win economic Partnerships.” (Financial Express)

Key Words: FTA, Africa, India

COVID-19 pandemic accelerated shift to e-commerce by 5 years, new report says – As the COVID-19 pandemic reshapes our world, more consumers have begun shopping online in greater numbers and frequency. According to new data from IBM’s U.S. Retail Index, the pandemic has accelerated the shift away from physical stores to digital shopping by roughly five years. Department stores, as a result, are seeing significant declines. In the first quarter of 2020, department store sales and those from other “non-essential” retailers declined by 25%. This grew to a 75% decline in the second quarter. The report indicates that department stores are expected to decline by over 60% for the full year. Meanwhile, e-commerce is projected to grow by nearly 20% in 2020. The pandemic has also helped refine which categories of goods consumers feel are essential, the study found. Clothing, for example, declined in importance as more consumers began working and schooling from home, as well as social distancing under government lockdowns. However, other categories, including groceries, alcohol and home improvement materials, accelerated, by 12%, 16% and 14%, respectively. The report suggests that department store retailers will need to more quickly pivot to omnichannel fulfillment capabilities in order to remain competitive in the new environment. Specifically, they will need to drive traffic to their stores through services like buy online and pickup in store (BOPIS), and will need to offer an expanded set of ship-from-store services. (WeForum)

Key Words: COVID-19, E-Commerce, Global Trade

US steps up pressure on France, Germany in Airbus dispute with extra tariffs on other goods – The United States stepped up pressure on Germany and France with extra tariffs on some of their goods, a move designed to squeeze the European Union into settling a long-running dispute over illegal subsidies to Airbus. In a statement in Washington on Wednesday (Aug 12), the US Trade Representative’s (USTR) office said it is removing from the tariff list certain products from Greece and Britain, and adding an equivalent amount of trade from France and Germany. The change is effective from Sept 1 and will apply to French and German jams as well as butchers’ and mincing knives, which will be subject to a 25 per cent duty. “The EU and member states have not taken the actions necessary to come into compliance with WTO decisions,” Ambassador Robert Lighthizer said in the statement. “The United States, however, is committed to obtaining a long-term resolution to this dispute.” The amount of products subject to countermeasures remains at US$7.5 billion (S$10.3 billion) and the tariff rates stay at 15 per cent for aircraft and 25 per cent for all other products, the USTR said. Airbus said it profoundly regrets the US decision to maintain the tariffs despite Europe’s recent actions to achieve full compliance “at a time when aviation and other sectors are going through an unprecedented crisis". The company said in a statement: “Airbus trusts that Europe will respond appropriately to defend its interests and the interests of all the European companies and sectors, including Airbus, targeted by these tariffs.” The announcement prolongs the burden of import taxes on American businesses and consumers while increasing the pain on transatlantic allies just as the global economy tries to claw back from a steep downturn tied to the Covid-19 pandemic. (ST)

Key Words: Global Trade, USA, Tariffs

Oil-backed trade group is lobbying the Trump administration to push plastics across Africa - A lobby group representing oil and chemical companies, including Shell, Exxon, Total, DuPont and Dow, has been pushing the Trump administration during the pandemic to use a US-Kenya trade deal to expand the plastic and chemical industry across Africa. Documents obtained by Unearthed show the same lobby group – and the US recycling industry – also lobbied against changes to an international agreement that puts new limits on plastic waste entering low- and middle-income countries. Several of the companies in the American Chemistry Council (ACC) – including Shell, Exxon and Total but not BP – were the founders of a $1bn initiative that pledges to create “a world free of plastic waste”. In public letters to top officials at the US Trade Representative and US International Trade Commission, the ACC writes: “Kenya could serve in the future as a hub for supplying U.S.-made chemicals and plastics to other markets in Africa through this trade agreement.” The letters also call for the lifting of limits on the waste trade, a move which experts say amounts to an attempt to legally circumvent the new rules on plastic waste, rules which – the documents reveal – the firms had also vigorously opposed.  Kenyan environmentalists said the proposals would mean that “Kenya will become a dump site for plastic waste”. US Democratic Senator Tom Udall, who last year introduced legislation to tackle the plastic waste crisis accused the companies of “double dealing.”  He told Unearthed: “It is outrageous that petrochemical and plastic industries claim the solution to our mounting plastic waste crisis is to produce more disposable plastic. These same companies and corporations then point the finger at developing nations for the plastic waste showing up in our oceans. This double-dealing makes clear what the true source of our plastic waste crisis is: companies and corporations off-shoring their responsibilities to make billions of dollars… Requiring these companies to take responsibility for their excessive waste and pollution is the only way we will tackle our colossal plastic waste problem.”   (Unearthed)

Key Words: Global Trade, Africa, US

PAN AFRICA

Africa Trade Pact’s Architects Seek to Help Offset Tariff Losses – Architects of an Africa-wide free-trade area are in talks with the African Export-Import Bank to set up an adjustment facility to offset revenue losses for countries that lower cross-border tariffs, according to the zone’s most senior official. “We are at advanced stages of negotiating with Afreximbank an adjustment facility, which will address the concerns of countries that will experience short-term revenue losses from liberalizing trade under the African Continental Free Trade Area,” Wamkele Mene, the secretary general, said Friday in a virtual tax summit organized by EY. The first commercial deal under what could be the world’s biggest free-trade area has been moved out to Jan. 1 from July after talks stalled due to the coronavirus pandemic. These are now being revived and moved online. The agreement aims to bolster intra-African trade by lowering or eliminating cross-border tariffs on 90% of goods, facilitating the movement of capital and people, promoting investment and paving the way for a continent-wide customs union. The planned reduction in duties has raised concerns from countries that rely on them for income. However, a World Bank report shows that short-term tariff revenues would decline by less than 1.5% for 49 out of 54 African countries, with total tax revenues set to decrease by less than 0.3% in 50 countries under the deal. That’s because only a small share of tariff revenues come from intra-African trade and with the bulk coming from a few tariff lines, which would enable some protectionist measures to be maintained even if countries liberalize, according to the Washington-based lender. In the long run, African countries should reduce their reliance on import duties for revenue and strengthen public finances, Mene said. (Bloomberg)

Key Words: AfCFTA, Tariffs, Eximbank

The Missing Links in Africa’s Ports Connectivity – Since Africa is home to many developing countries, including 16 which are landlocked, it is faced with immense pressure to improve its connectivity to global trade. As these vulnerable economies continue to lag behind in the development of key infrastructure, such as road and rail transportation, they have considerable challenges benefitting from trade opportunities due to unreliable movement of their imports and exports, which drives up trade costs. It is against this background that the United Nations Economic Commission for Africa (UNECA) mooted the idea of a Trans-African highway back in 1971, towards the conclusion of the African Independence era. The highway is not just one proposed road, but a mosaic of nine highways extending nearly 40,000 miles across the continent, connecting major African port cities. The longest connects the Mediterranean Sea at Libya’s capital of Tripoli to the Atlantic Ocean off South Africa’s Capetown. The east-west highway connecting the major metropolitan powerhouses of East Africa and West Africa (the ports of Lagos, Nigeria and Mombasa, Kenya) is among the shortest, but it is a very challenging transport corridor. 

Although more than half of the road network has been paved, there are numerous missing links, especially on the highway linking Mombasa with Lagos. Countries like the Central Africa Republic and DRC (Democratic Republic of Congo) along this route have a low coverage of paved roads, and tracks are impassable due to difficult terrain or after rain. Militia wars and conflicts are partly to blame, as infrastructure development can only happen in times of peace and stability. The persistent unrest in Somalia led to its exclusion from this transcontinental highway network. Only Nigeria, Cameroon, Uganda and Kenya have completed their roads, with huge parts connecting Uganda, DRC and Central Africa Republic unfinished and in poor condition. This contributes to factors that cause Africa to incur higher transportation costs - in the range of 50-175 percent higher than the developed world - compounded by the fact that most of the African countries are net importers of food and other essential products, like agricultural inputs. (The Maritime Executive)

Key Words: UNECA, Africa, Shipping Sector

COMESA, AU, SADC Engage Youth on Silencing the Guns – COMESA, the African Union and SADC have agreed that young people in Africa should no longer be seen as perpetrators of conflicts or targets of violence but rather be recognized as actors and partners in promoting peace and security. The three bodies have acknowledged that youth are partners who have continued to play an important role in preventing and maintaining peace on the continent.   This affirmation was made during the Southern Africa Regional Consultations on the Roles of Youth in Silencing the Guns in Africa. The virtual meeting held on Friday 28 August was organized by COMESA working with the AU and the Southern African Development Community (SADC). It attracted youth participation from most parts of COMESA and SADC. High level representatives from the two Regional Economic Communities (RECS) and the AU discussed how youth can play a bigger role in silencing the guns on the continent. The event offered an opportunity to the young peacebuilders to interact with the RECs and build relationships with their intergovernmental institutions.

The consultations were also meant to provide youth with a platform to update the RECs on their activities as peacebuilders and support the implementation of Silencing the Guns programme which aims to free the African continent of wars, civil conflicts, humanitarian crises, human rights violations, gender-based violence and genocide. COVID-19 pandemic was also mentioned as a threat to youth development because they are among the most affected.  Speaking on behalf of COMESA Secretariat, Assistant Secretary General for Programmes Dr Kipyego Cheluget highlighted the need for the youth to be more involved in implementing programmes that affect the continent such as Silencing the Guns. He called for the need to build a bridge between the current generation and the next who are youth by passing on the baton. “….we should resolve to move from rhetoric to action which will require that we change our mindsets and start to view the youth, not as leaders of tomorrow but leaders of today,” (COMESA)

Key Words: COMESA,AU, SADC

4th High-Level Tax Policy Dialogue: Taxing rights for Africa in the new world and effects of COVID-19 – The role of tax policymakers and tax administrators – A collaboration between the African Tax Administration Forum and the African Union Commission. Outcome Statement. Extract: The 4th ATAF High-Level Tax Policy Dialogue attracted over 529 officials from Ministries of Finance and African Tax Administrations of 48 African Union (AU) member states, Members of Parliament, Regional Economic Communities (RECs), Civil Society, African Development Bank (AfDB), African Central Banks, African Stock Exchanges, Organization for Economic Cooperation and Development (OECD), United Nations Economic Commission for Africa (UNECA), International Monetary Fund (IMF), Development Partners including DfID and SECO, other key partners, individual tax policy experts and private sector players. The High-Level Tax Policy Dialogue took place virtually through Zoom Conferencing on the 26th and 27th August 2020 under the theme “Taxing Rights for Africa in the New World and Effects of COVID-19: The Role of Tax Policymakers and Tax Administrators”. The event was jointly organised by the African Tax Administration Forum (ATAF) and the African Union Commission (AUC), and with the support of the African Development Bank (AfDB).

The three speakers in the Opening Session: Mr Logan Wort (Executive Secretary, ATAF), Mr Muhammad Nami (Chairman, ATAF Executive Council) and H.E. Victor Harison (Commissioner of Economic Affairs, African Union Commission) highlighted the following critical issues:

• As countries try to get back on their feet as a result of the uncertainties introduced by COVID-19, countries must remember that behind uncertainty, lies opportunity. The opportunity, to re-channel our efforts towards Domestic Revenue Mobilisation, the opportunity to design and introduce new economies which are cognisant of gender and alive to inclusivity, a continental platform for policymakers and administrators to collaborate, the pursuit of more substantial taxing rights, and the opportunity to mobilise relevant institutions in a way that facilitates a coordinated and formidable African voice in the international tax arena. 
• The COVID-19 pandemic has shocked all economies and has resulted in significant operational and policy challenges for African tax administrations and large-scale negative growth projections. African countries introduced measures to ensure business continuity and survival, which measures will add to the already reduced tax revenues in African countries. 
• The pandemic has forced many people to work from and stay at home, and this has increased online activities, including video conferencing, online marketing, electronic sales and procurement of goods and services, and streaming of electronic media. An increase in digital activities is an indication that taxing rights will form a vital part of the post-pandemic environment for Domestic Revenue Mobilisation; hence the need for African political leadership to weigh in for a positive outcome from the global debate on these rights. (tralac)

Key Words: AU, Regional Integration, COVID-19

EAST AFRICA

EAC in race against time for post-Brexit deal with UK – East African countries are scrambling to secure bilateral trade deals with the United Kingdom for the post-Brexit era as the current multilateral agreement nears expiry and negotiations for a new collective pact stall over ideological differences. The East African Community is racing against time to get a new deal with extensive talks expected in the coming weeks. There are only four months left until the current trade arrangement ends December 31, which gives partner states duty and quota-free access to the British market. Rwanda has been chairing the bloc’s negotiations but is also pursuing a bilateral post-Brexit deal with the UK that will offer Rwandan exports continued free access to Britain from January 2021. The Tanzanian government is renegotiating its current bilateral trade relationship with Britain in the wake of the latter’s exit from the European Union, Deputy Minister for Trade Stella Manyanya said, noting that they are looking to protect locally-made goods. Kenya is considered the most vulnerable as the country will be affected most if the EAC does not sign a multilateral post-Brexit trade deal with the UK. Being a lower-middle-income country, Nairobi’s exports would be subject to taxes and other restrictions while other member states classified as Least Developed Countries continue to enjoy unrestricted access. The EAC is supposed to have signed a draft agreement by the end of next month, but that looks highly unlikely. An initial meeting that held last week was downgraded to “consultative talks” instead of a decisive agenda-setting forum, according to a report by The EastAfrican.  (Ventures)

Key Words: EAC, Brexit, FTA

SGR is the road of friendship and prosperity for Sino-Kenyan ties – The global infrastructure landscape has changed tremendously since the advent of China’s Belt and Road Initiative, billed as the single most significant undertaking by the country on the international stage. The initiative — a long-term policy and investment programme that aims at infrastructure development, increasing trade and acceleration of economic integration to connect Asia with Africa and Europe — was unveiled in 2013 by China’s President Xi Jinping. BRI consists of a Silk Road Economic Belt, a trans-continental passage that links China with South East Asia, South Asia, Central Asia, Russia and Europe by land and a 21st century Maritime Silk Road, a sea route that connects the China’s coastal regions with South Asia and south east, the South Pacific, the Eastern Africa and the Middle East. The BRI’s infrastructure development goals complement the African Union’s own Agenda 2063, which mainly focuses on the continent’s interconnectivity. They are both centred on sustainable industrialisation and industrial diversification, and generating high-value add and decent employment for all.

In Africa, Kenya is a core part of the Maritime Silk Road and the Belt, with the standard gauge railway being the flagship project of this initiative. The project is significant in terms of saving valued natural resources and protecting the environment, especially from the challenge of global warming, because it will reduce the carbon emission footprint by introducing a modern and more efficient railway system. It is one of Kenya’s Vision 2030 flagship projects that will contribute significantly to different sectors of the economy, directly or indirectly. As part of BRI, SGR is the "road of friendship" and "road of prosperity and development" for a win-win cooperation between China and Kenya. It is also an important outcome of Sino-Africa cooperation on infrastructure development. As the general manager of Africa Star Railway Operation Company (Afristar), the operator of SGR, I find Kenya a great place to work because it has an excellent business climate and Kenyans have a good work ethic. (The Star)

Key Words: EAC, Trade, Regional Integration

WEST AFRICA

Côte d’Ivoire approves €400m project to create West African port hub – Work is set to begin on the expansion of the port of Abidjan in the Côte d’Ivoire after an agreement was signed between French logistics company Bolloré, Dutch port operator APM Terminals, and China Harbour Engineering Company (CHEC), the contractor that will carry out the work. The €400m project will add a second container terminal to Abidjan on reclaimed land. This Côte d’Ivoire Terminal (CIT) is scheduled to be complete by the end of next year, after which the developers will run the port during a 20-year concession period before transferring ownership to Abidjan Port Authority. The expansion is expected to add 1.2 million containers a year to the port’s capacity, lengthen its quays by 1.1km and dredge an 18m-deep shipping channel, sufficient to accommodate ships with a carrying capacity of 14,000 containers and 350m in length. The present port has a depth of 11.5m. West African economies are experiencing an economic boom, and GDP in Côte d’Ivoire is presently growing at around 7% a year. However, their connection to global markets is impeded by inadequate port services. In particular, most of the region’s harbours are unable to accommodate the huge container ships now favoured by shipping lines that are anxious to cut costs in a highly competitive logistics market. There is a race among a number of West African countries to build modern deep-sea transshipment hubs that can act as the unloading point for goods that are then transferred to smaller ships able to navigate shallower ports (see further reading). (Hellenic Shipping News)

Key Words: West Africa, Shipping Industry, Regional Integration

SOUTHERN AFRICA

New ‘single channel’ service created to help resolve barriers to South African exports - The Department of Trade, Industry and Competition (DTIC) has launched a new ‘single channel’ online service through which South African exporters are able to register any problems they are experiencing in their trade interactions and secure dedicated support from government to resolve concerns. Through the Export Barriers Monitoring Mechanism (EBMM), which was officially launched on August 31, exporters can log both tariff and nontariff obstacles using an online form being developed for the department’s website, or by drafting an email to ExportBarriers@thedtic.gov.za. The DTIC has committed to acknowledging receipt of the complaint within 24 hours and to appointing a dedicated official to follow up on the matter within three days of receiving the notification. Within two weeks, that official should have contacted the exporter to develop an agreed ‘resolution plan’, outlining the steps that will be taken to resolve the complaint. Deputy director-general for export development and promotion and outward investment Lerato Mataboge indicates that the DTIC views the service as part of government’s broader strategy of supporting an export-led recovery from the Covid-19 pandemic, which has negatively affected many exporting firms.

In 2018, South African exporters faced an estimated 154 571 unique customs requirements worldwide. The EBMM, she adds, will be used to assist with barriers encountered locally and in all foreign markets, but will have a particular focus on smoothing trade with the rest of Africa. Increased levels of intra-Africa trade is a government priority following the signing of the African Continental Free Trade Agreement (AfCFTA) by 54 African countries in 2019, 28 of which have since ratified the agreement. The DTIC’s Christopher Wood says the EBMM will also have a strong focus on addressing the nontariff barriers stifling regional trade. (Engineering News)

Key Words: SA, AfCFTA, Regional Integration

Zimbabwe, Botswana plan seamless border services – ZIMBABWE and Botswana are set to establish a One-Stop Border Post, which will see traders from both countries enjoying seamless border immigration processes and improved trade prospects with wider economic impact on the region at large. Botswana is one of Zimbabwe’s traditional trading partners and local companies, especially from Bulawayo, which is the country’s industrial hub, could take advantage of the proximity between the two countries to export to the neighbouring country at competitive prices. Francistown, which is closer to Zimbabwe than the capital, Gaborone, can be used as an entry point into the market, experts say. Zimbabwe’s trade with Botswana has in the past three years shown steady growth with Zimbabwe’ exports moving from US$19,2 million in 2017 to US$43,3 million in 2019. It is in this context that the two governments are discussing possibilities of establishing a One Stop Border Post at Plumtree/Ramokgwebana entry/exit point. The move is expected to significantly reduce time taken to clear goods and passengers at the borders. This was revealed by Zimbabwe Ambassador to Botswana, Mr Batiraishe Henry Mukonoweshuro during a Virtual Trade Mission organised by ZimTrade and Botswana Investment and Trace Centre recently. Ambassador Mukonoweshuro said the planned One Stop Border Post which is in line with Southern African Development Community (Sadc) plans, will go a long way in facilitating improved intra-regional trade in Southern Africa. “With regards to the issue of trade facilitation, the Governments of Zimbabwe and Botswana are discussing the possibility of establishing a One Stop Border Post at Plumtree/Ramokgwebana,” he said. “This will enhance trade facilitation and lead to expansion of trade, not only between Zimbabwe and Botswana but intra-regional trade in goods and services, contributing towards Sadc’s regional integration objectives.” (The Chronicle)

Key Words: SADC, Regional Integration, Economic Growth

Stricter cryptocurrency taxes are on the way in South Africa – Accounting and consulting group Mazars, says that cryptocurrency traders should prepare for stricter taxes in South Africa in the near future. Over the last five years, South Africa has emerged as one of the world’s most notable cryptocurrency adopters, and an estimated 13% of its internet users owning or using cryptocurrencies. With the South African Bitcoin/ZAR weekly trading volume – to name just one – currently standing close to R30 million, there are various manners in which the South African Revenue Service (SARS) can track the gains made by South African taxpayers who trade cryptocurrencies. This is according to Wiehann Olivier, partner at the audit division of Mazars in South Africa, who says that there are various techniques SARS could apply for the direct taxing of cryptocurrencies. “To start, the fact that cryptocurrencies were created to allow for anonymous, frictionless and trusted peer-to-peer transaction to be conducted over the internet (including cross-border transactions) means that it can be used as a means of tax avoidance in a number of different ways.” As Olivier explains, investors can store their cryptocurrencies in paper or hardware wallets instead of relying on a custodian such as an exchange to safeguard their assets, which makes it impossible to confiscate these cryptocurrencies and extremely difficult to track their movements. “There is also the option to rely on a series of smoke and mirrors. Different types of cryptocurrencies can be exchanged for one another and passed through a series of wallets and public key addresses to attempt to confuse the trading activities and to evade taxes.” He noted that SARS is currently relying on the honesty of South African taxpayers to include their realised gains on cryptocurrencies as part of their taxable income. (Business Tech)

Key Words: SADC, Regional Integration, Economic Growth