Africa
AU's approval of AfCFTA draft protocols paves way for more trade
The African Union (AU) has approved the African Continental Free Trade Area (AfCFTA) draft protocols on investment, intellectual property rights and competition policy paving way for their implementation. The move signals conclusion of the AfCFTA Phases I and II protocols that provide a legal basis for the start of trading and gives members the greenlight to domesticate the protocols. “The Assembly takes note of the executive council recommendations for the consideration and adopts the following draft Legal Instruments: draft protocol to the agreement establishing the AfCFTA Competition Policy, Investment and on Intellectual Property Rights (IPR),” the AU communique reads. Phase I of the AfCFTA Agreement consists of protocols on trade, goods and services, and rules/procedures on settlement of disputes. However, it will take some time for all the required ratifications to be processed with regard to national constitutional requirements for enforcing new protocols. Under the Protocol on Trade in Goods, state parties committed to reduce tariffs on 90% of goods traded among themselves in equal annual instalments until they are eliminated within five years for non-least developed countries (non-LDCs) and 10 years for least developed countries (LDCs).
Source: The EastAfrican
Africa
Energy transition: Africa must bridge technological gap, step up dialogue around innovation
“Our current challenge is to get heads of state to adopt a joint, green hydrogen policy by the end of this year,” said Francis Sempore, executive director of the Economic Community of West African States (ECOWAS) Centre for Renewable Energy and Energy Efficiency on Monday, 27 February 2023, in Niamey (Niger). “Green hydrogen in West Africa may sound utopian now, but so did the ECOWAS leaders’ decision to adopt a regional policy on renewable energy in 2013. Yet it has become unthinkable for a country not to have solar energy in its energy mix,” he added. Mr Sempore was speaking at the fifth African Science, Technology, and Innovation Forum High-level Policy Dialogue on emerging energy technologies along with a panel of African and United Nations (UN) experts who called for a deep overhaul of Africa’s approach to energy issues to break the vicious cycle of outdated technologies, respond more efficiently to electricity needs and speed up economic development.
Source: UNECA
Africa
Top solar developments in the MSGBC region in 2022/23
In the past year, Mauritania, Senegal, The Gambia, Guinea-Bissau and Guinea-Conakry (MSGBC) region has been driving an ambitious energy expansion agenda backed by energy security, affordability and energy independence targets. While large-scale oil and gas developments are set to come online this year – such as the 100 000 barrel per day Sangomar oil development and the 2.5 million tonnes per annum Greater Tortue Ahmeyim gas project – promise advances in fuel security, progress across the renewable sector has opened new opportunities for widespread electrification on the back of solar. Eager to capitalise on the significant solar potential available across the region, MSGBC nations have been driving a series of solar projects over the recent year. Local content has been made a priority across the MSGBC region’s solar space, with nations pushing for the training of technicians and scaling up of the local workforce in this industry.
Source: Energy Capital & Power
Africa
UNECA urges African countries to prioritise green mineral value chains for sustainable industrialisation
To meet the goals of the Paris Climate Agreement, the Sustainable Development Goals (SDGs) and Africa’s Agenda 2063, the world must decarbonise its growth models and shift to renewable energy sources, says acting executive secretary of the United Nations Economic Commission for Africa (UNECA), Antonio Pedro. Speaking during a panel discussion on Building a regional battery mineral value chain in Africa, Mr Pedro said the shift to renewable energy sources was a resource-intensive path that required greater production of a variety of minerals that are central to decarbonisation. Africa is home to many of such minerals. The Democratic Republic of the Congo (DRC), for example, produces over 70% of the world’s cobalt. The DRC and Zambia together supply 10% of global copper while Mozambique and South Africa hold significant reserves of graphite, platinum metals, lithium and more. “We have clear opportunities not only from the global green mineral boom but also from our domestic achievements, such as the African Continental Free Trade Area (AfCFTA) to facilitate the development of regional value chains for these green economy products," Mr Pedro said, noting several innovative financing mechanisms that have been developed to support initiatives such as the battery and electric vehicles value chains.
Source: UNECA
Southern Africa
President Ramkalawan calls for concerted efforts to harness the potential of tourism, blue economy and wildlife for SADC regional integration and development
The President of Seychelles, Wavel Ramkalawan, has called for concerted efforts among members of the Southern African Development Community (SADC) to harness the potential of tourism, blue economy and wildlife as drivers of economic growth, regional integration and development. President Ramkalawan made the call on Friday, 24 February 2023 when he received a courtesy call from the executive secretary of SADC, Mr Elias M. Magosi at the State House in the Seychelles Capital of Victoria, Mahe Island. The president stressed the importance of putting issues of environment, climate change, maritime security, and blue economy among the key priorities of the SADC regional development agenda, as the people of Seychelles, like other Island nations, depend on ocean resources for their sustenance and livelihood. On this note, the president called for regional preparedness against disasters emanating from climate change which, in the case of Seychelles, affect the tourism and fisheries sectors, two of the key pillars and contributors to Seychelles GDP, employment and foreign exchange.
Source: SADC
Angola
Angola moots tax breaks for investors in diamond industry
Diamantino Azevedo, the Minister of Minerals, Oil, and Gas in Angola, has announced that the Angolan government intends to provide tax incentives to draw more investors in the diamond-polishing industry. The minister made the declaration at the opening of the fifth diamond-cutting facility at the Saurimo Diamond Development Park in the province of Lunda Sul. Azevedo emphasised that his ministry would keep working to improve conditions for industries in the industrial park, especially in response to company complaints regarding a lack of fiscal incentives. He stated that the incentives promote competitiveness, create more job opportunities for young people, and facilitate technology transfer. According to the minister, the park significantly contributes to the nation’s economic diversification, generates direct employment, provides training possibilities, and inspires people.
Source: Namibia Economist
Angola
IMF Executive Board concludes 2022 Article IV consultation with Angola
The Executive Board of the International Monetary Fund (IMF) concluded the Article IV consultation with Angola. Angola’s economy continued to recover from the COVID-19 pandemic in 2022, supported by higher oil prices, improved oil production, and resilient non-oil activity. Non-oil growth was broad-based despite a challenging external environment. Growth is estimated at 3.5% for 2023. Headline inflation declined significantly to 13.8% year-on-year at end-December 2022, driven by lower global food prices, a stronger kwanza, and previous efforts by the central bank to tighten monetary policy. The non-oil primary deficit increased in 2022 following higher-than-budgeted capital expenditure and higher-than-expected fuel subsidy costs. Nonetheless, the public debt-to-GDP ratio fell by an estimated 17.5 percentage points of GDP to an estimated 66.1% of GDP, aided by a stronger exchange rate. The current account is estimated to have remained in a large surplus in 2022, while foreign currency reserve coverage remained adequate. Overall growth is expected to continue in 2023 and reach about 4% in the medium term, as the authorities’ structural reform agenda supports the non-oil sector. Inflation should continue its gradually declining path, reaching single digits in 2024.
Source: IMF
Burkina Faso
The AMP programme is launched for electrification via solar mini-grids
The African Mini Grid Programme (AMP) has been launched in Burkina Faso. This initiative of the United Nations Development Programme (UNDP) aims to support electrification via green mini-grids, with the support of the Global Environment Facility (GEF). After Somalia and Nigeria, the GPA programme will be implemented in Burkina Faso. This initiative of UNDP was launched recently in Ouagadougou by the Burkina Faso Minister of Energy, Mines and Quarries, Simon-Pierre Boussim, in the presence of local UNDP officials and the GEF, which is co-financing the AMP programme. Overall, the programme aims to provide technical assistance for the deployment of solar mini-grids in at least 21 African countries. In Burkina Faso, the authorities will use this regional initiative to accelerate electrification by improving financial sustainability and promoting large-scale commercial investments in solar photovoltaic (PV) mini-grids. According to UNDP, the AMP programme will support innovation and technology transfer in decentralised renewable energy distribution and storage solutions.
Source: AFRIK 21
Kenya
CBK approves Fingo Africa, first digital-only bank in Kenya
Fingo Africa has received regulatory approval from the Central Bank of Kenya (CBK) to roll out its services in the Kenyan market, setting it on course to become the first digital-only bank in the country. The neobank is targeting to roll out digital banking services including opening an account, making withdrawals and deposits, checking bank balances, requesting bank statements and monitoring financial records. “Fingo has partnered with Ecobank, the largest footprint bank in Africa, providing Fingo market access to Ecobank’s 33+ markets. Fingo and Ecobank are planning a pan-African roll out beginning in Kenya, where they are the first digital-only bank in the country,” the start-up says on its website. This comes at a time when digital banking services continue to grow, with Kenya’s traditional banks recording a rapid increase in digital banking transactions in recent years.
Source: The Nation
Kenya
EIB to grant Kenya KES244-million for hydrogen projects
The European Investment Bank (EIB) will provide EUR1.8-million (approximately KES244.2-million) to the Kenyan government for onward lending to green hydrogen investors in the country. The revelation was made when Treasury Cabinet Secretary Professor Njuguna Ndung’u and EIB vice president Thomas Östros signed a joint declaration on renewable hydrogen. The bank earlier held discussions on green hydrogen with President William Ruto. “Kenya has some of the best renewable energy sources in the world if the storage components were equally developed. The route to storage has the potential to develop green hydrogen to deliver sustainable, green and inclusive growth,” said Professor Ndung’u. Energy Cabinet Secretary Davis Chirchir noted that Kenya’s huge potential in wind and solar power, which largely remains unexploited, can be harnessed to produce green hydrogen which would in turn provide affordable power for the country’s industrial growth. “Development of green hydrogen in Kenya has the potential to enable 100% of Kenya’s energy needs to be supplied by clean power,” said Chirchir. Östros said the European team will work to enhance wind, solar and geothermal-driven development in both the public and private sectors.
Source: Business Daily Africa
Kenya
Technology seals border revenue leaks, says KRA
The use of cargo clearance technology by the Kenya Revenue Authority (KRA) has helped the taxman plug revenue collection gaps at the borders in the wake of increasing pressure by the new administration to seal leakages. Stringent border control measures between Kenya, Tanzania and Somalia have also led to a decline in tax evasion, increasing revenue collection for the authority’s southern region which covers the coastal counties of Lamu, Kilifi, Kwale, Mombasa, Tana River and Taita Taveta. The KRA southern region coordinator Joseph Tonui says the agency has surpassed its revenue targets in the last six months by KES3-billion in terms of tax collection. “For the last six months, we collected KES267-billion. This is both for customs and domestic taxes. The target was KES264-billion. We achieved 101% with a surplus of KES3-billion,” he explained. Mr Tonui said the authority will soon use drones in mobile monitoring of goods to curb theft and tax evasion.
Source: Business Daily Africa
Kenya / United Arab Emirates
Kenya will import UAE oil on credit to ease dollar woes
Kenya will from next month start importing fuel on credit of up to one year from the United Arab Emirates (UAE) to ease pressure on dollar demand amid uncertainty over its impact on local pump prices. Energy and Petroleum Cabinet Secretary Davies Chirchir says the government-to-government deal will see Kenya import 30% of its monthly fuel requirements through the state-owned National Oil Corporation of Kenya (NOCK). The imports, which will come through a credit of between six months and a year, are expected to ease a crisis in the foreign exchange market given that oil shipments account for 28% of Kenya’s monthly imports. State officials were guarded on how the shipment will affect fuel prices in Kenya amid concerns that the longer credit line could wipe out the benefits of buying diesel and petrol in large quantities. Pump prices have remained unchanged since November, with a litre of super petrol retailing at KES177.30 in Nairobi and diesel at KES162 per litre, up from KES106.99 and KES96.40, respectively, in February 2021. But the regulator reckons that Kenya could benefit from discounts due to purchase of fuel in bulk.
Source: Business Daily Africa
Madagascar
IMF Executive Board completes third review under the ECF, approves USD32.6-million disbursement, and concludes 2022 Article IV consultation with Madagascar
The Executive Board of the International Monetary Fund (IMF) concluded the Article IV consultation and completed the third review of the Extended Credit Facility (ECF) arrangement with Madagascar. The completion of the review enables the disbursement of SDR24.44-million (about USD32.6-million), usable for budget support, bringing Madagascar’s total disbursements under the arrangement to SDR146.6-million (about USD195.5-million). Since the last Article IV consultation in 2019, the Malagasy authorities have implemented several key policy recommendations, but ambitious reforms remain hampered by limited capacity and weak governance. In a context of lower global growth and high international prices, Madagascar’s growth is projected to stall at 4.2% in 2023 while annual average inflation would accelerate above 10%. Risks from the domestic political situation, low COVID-19 vaccination rates and adverse global developments cloud the outlook. On the upside, the implementation of the full reform agenda envisaged in the Plan Emergence Madagascar would have significant effects on productivity and growth.
Source: IMF
Mali
Mali follows Togo, Niger and Burkina Faso in adopting factoring law, developed in collaboration with Afreximbank
African Export-Import Bank (Afreximbank) celebrates the adoption and enactment of a factoring law in the Mali. Afreximbank’s Factoring Model Law was used as a guide for the development of La Banque des États de l’Afrique de l’Ouest (BCEAO’s) factoring law, which Mali has adopted. This conforms to the bank’s factoring strategy, which aims to provide legal and regulatory support to African countries in their pursuit of factoring as an alternative financing option. The enactment of the law in Mali creates a facilitative legal and regulatory environment for factoring to thrive in the country, thereby supporting small and medium-sized enterprises (SMEs) with access to another form of financing. The move, which follows similar legislative developments in Togo, Niger and Burkina Faso, constitutes a crucial milestone in the broader African effort to increase its share of global factoring transactions from its current level of around 1%. Moreover, Mali’s decision may well encourage other BCEAO member states to adopt and domesticate the law.
Source: Afreximbank
Rwanda
Central bank of Rwanda takes further action on transactions in foreign currency by non-licensed persons
The National Bank of Rwanda has issued a directive establishing conditions for non-licensed persons to get authorisation to transact in foreign currencies in Rwanda. The Directive No0520/2023-00041[613.1.4] of 22/02/2023 was issued by the central bank (the Central Bank Directive) on 22 February 2023 and provides guidance on the implementation of the central bank Regulation on Foreign Exchange Operations, 2022 (the Central Bank Regulation). This requires non-licensed persons to obtain prior authorisation from the central bank before transacting in foreign currencies. Although the Central Bank Regulation provides for the obligation for non-licensed persons to apply for authorisation to transact in foreign currencies, the latter does not set out the process to be followed and requirements to be met by such persons when applying for authorisation to transact in foreign currencies. This is a gap which has now been bridged by the Central Bank Directive.
Source: ENSafrica
Tanzania
IMF reaches staff-level agreement on the first review of the ECF and conducts 2023 Article IV consultation with Tanzania
A staff team from the International Monetary Fund (IMF) led by Charalambos Tsangarides held meetings in Dodoma and Dar es Salaam from 8 February to 23 February 2023, to discuss progress on reforms and the authorities’ policy priorities in the context of the first review of Tanzania’s forty-month programme under the Extended Credit Facility (ECF)-supported programme. The arrangement was approved for a total amount of SDR795.58-million (USD1.046-billion at that time) on 18 July 2022. The team also conducted the 2023 Article IV consultation. At the conclusion of the mission, Mr Tsangarides issued the following statement, in part: “The Tanzanian authorities and IMF staff team have reached a staff-level agreement on the first review of Tanzania’s economic programme under the ECF arrangement. Staff-level agreement is subject to approval of IMF management and the executive board in the coming weeks. Upon completion of the executive board review, Tanzania would have access to SDR113.37-million (about USD151-million), bringing the total IMF financial support under the arrangement to SDR228.73-million (about USD302.7-million).”
Source: IMF
Togo
USD64-million from the World Bank for solar energy and electricity storage
The government of Togo and the World Bank have signed a USD64.2-million financing agreement. The funding is intended for the electrification of at least 60 localities as part of a regional project initiated by the World Bank. The USD64-million financing agreement was signed between Sani Yaya, Togo’s Minister of Economy and Finance, and Coralie Gevers, the World Bank’s director of operations for Togo. The funding is part of a USD311-million package committed by the World Bank under the Regional Solar Emergency Response Project (RESPIT). The initiative aims to “rapidly” increase grid-connected renewable energy capacity and strengthen regional integration in Togo, Chad, Liberia and Sierra Leone. In Togo, RESPIT will build a 25-megawatt peak (MWp) solar photovoltaic (PV) power plant in Dalwak, near the northern town of Dapaong on the border with Burkina Faso. The plant will be equipped with a 40-megawatt-hour (MWh) battery storage system, which will allow the electrification of 60 localities in northern Togo.
Source: AFRIK 21
Uganda
Uganda publishes its Public Investment Management Assessment (PIMA)
The Ugandan authorities have agreed to publish the results of the recent Public Investment Management Assessment (PIMA) carried out by the International Monetary Fund (IMF). The PIMA is a standard IMF tool that has been applied in more than 80 countries, but only 23 reports have been published so far. Countries are encouraged to share these assessments with others, and the Uganda PIMA includes a wealth of information and analysis that will be of great interest to other countries. Uganda has achieved significant improvements in public investment management (PIM) over the last few years. The government has implemented several important reform measures. These include giving the Development Committee a strong role as a gatekeeper for new investment proposals, the establishment of a Projects Analysis and Public Investment Department (PAP), and development of a draft public investment policy, as well as guidelines and manuals to improve the quality of project preparation and appraisal. While the government has been in the driver’s seat in these reforms, the IMF and other development partners have contributed actively in designing and implementing them, and we believe this support has been very productive.
Source: IMF Public Financial Management Blog
