Welcome to my first African Trade Policy and Law Update which puts together some of the key developments in trade policy and trade law in Africa, while at the same time spotlighting what these mean for trade in Africa, and also for regional integration.
The Highlights
The USA recently removed Ethiopia, Mali and Guinea from the AGOA Trade Programme. AGOA is a unilateral trade preference scheme that the US has been administering under WTO’s Waiver. The decision is reportedly based on human rights violations in these countries. The concerning issue for African countries is how can LDCs on the continent benefit from trade arrangements such as AGOA , which are firstly unilateral, and which can be withdrawn whimsically? Also as the USA was removing Ethiopia from AGOA, it was also appointing an envoy through whom it hopes to address the Tigray conflict.
Chinese Foreign Affairs Minister Wang Yi has been visiting Eastern Africa region ,engaging the leadership in Kenya, Eritrea and the Comoros and overseeing the signing of a couple of cooperation agreements. This visit comes right on the heels of FOCAC which was concluded in Dakar Senegal. In Kenya the agreements included MoU on export of avocadoes and fish. Other promises were $40 billion in financing Africa economic growth this year, and also the appointment of a special envoy to Horn of Africa.
In terms of infrastructure development, Uganda on Saturday commenced collection of road tolls along the Kampala- Entebbe Expressway 51km road, built at a cost $350 million and financed by Exim Bank of China. Uganda apparently intends to complete other major expressways all of which will levy tolls. This is a significant development and will elicit debate on the pathways for Africa in delivering public goods.
And still on infrastructure, Tanzania recently inked a contract for extension of the SGR construction which will see the 368 km stretch from Makutupora in Dodoma Region to Tabora at a cost of $1.908 billion by Turkish firm, Turkish contractors Yapi Merkezi.
Looking at the outlook of infrastructure construction in Eastern Africa, one aspect that have been ignored is connecting the various infrastructure e.g rail in EAC to creates a seamless transport system. This is one of the surest ways of creating regional value chains, and boosting intra-EAC and also intra-African trade.
And speaking of intra-African trade, the latest statistics indicate that Kenya posted a goods trade deficit of $80.16 million, or 29.97 percent, with Tanzania and this is linked to the cordial trade relations that Kenya has had with Tanzania following the meeting between the leader of the these countries in May 2021.
Finally African airlines are banking on inter airline agreements, expansion of networks, and cargo lines to remain afloat in 2022 even as pandemic restrictions continue to nibble away at their bottom lines. The prospects of creating stronger airlines on the continent can be a step towards creating a pan-African Air Transport system.
I hope you enjoyed reading this update. Be on the lookout for more!
Patrick's Trade Digest 