AfDB and Agence Française de Développement sign EUR2-billion co-financing partnership agreement for Africa
The African Development Bank Group (AfDB) and the Agence Française de Développement on Wednesday, 10 November signed a co-financing and partnership agreement to strengthen their relationship and leverage additional resources for impactful projects in Africa. AfDB president Dr Akinwumi A. Adesina and Agence Française de Développement CEO Rémy Rioux signed the agreement in Paris on behalf of their two institutions. The agreement, which runs for five years, from 2021 to 2026, targets an indicative amount (EUR2-billion) in co-financing over its first three years. It will complement the current partnership between both institutions through mutual understanding, by facilitating staff exchanges, sharing knowledge, and jointly organising events. The existing partnership already covers such key sectors as infrastructure, water and sanitation, agriculture, and the private sector. The new agreement supersedes an earlier framework agreement signed in November 2015.
World Bank projects African economy to go up a full percentage point in 2021
Global financial institutions are revising upwards their outlook on Africa’s economic growth, signalling that the continent is recovering from the impact of COVID-19 and becoming more resilient, despite slower vaccine rollout. The International Monetary Fund (IMF) and World Bank’s latest economic outlook shows Africa is set to emerge from the 2020 recession sparked by the COVID-19 pandemic. The World Bank, in its latest edition of Africa’s Pulse, projects the economy will expand by 3.3% in 2021 – a full percentage point rise compared to its April forecast. “This rebound is currently fuelled by elevated commodity prices, a relaxation of stringent pandemic measures, and recovery in global trade,” said the World Bank. The IMF shares similar sentiments in its regional economic outlook for sub-Saharan Africa, which it says is set to grow by 3.7% in 2021 and at an even higher pace (3.8%) in 2022. “The recovery is supported by favourable external conditions on trade and commodity prices. It has also benefited from improved harvests and increased agricultural production in a number of countries,” says Abebe Aemro Selassie, director, African Department, IMF.
Source: The Africa Report
CEMAC: Telecom regulators ink memoranda to suppress roaming surcharges
On 9 November 2021, in Douala, Minister of Posts and Telecommunications (Minpostel) Minette Li Libom Likeng presided over the signing of bilateral agreements between Central African Economic and Monetary Community (CEMAC) countries for the suppression of roaming surcharges expected since January 2021. "The signing, by regulators, of bilateral memoranda of understanding governing the implementation of low-cost roaming in the CEMAC zone is undoubtedly a key step in the roaming process in our subregion. It above all is a fundamental step in the improvement of access to affordable electronic communications services," the Minpostel said. According to the official, with the officialisation of the agreements, roaming costs are effectively suppressed in the sub-region. It all started because CEMAC countries wanted to facilitate communications in the region and address the problem encountered by residents of border towns who unexpectedly roam into a neighboring country’s operator’s network, incurring additional charges.
Source: Business in Cameroon
East / Central Africa
Equity unveils USD4-billion recovery plan for regional economies
Equity Bank, in collaboration with 37 partners that include United Nations agencies and development financial institutions, has developed a plan to accelerate post-COVID-19 economic recovery in the East and Central African region through a private sector-driven USD4.68-billion stimulus package. The Marshall Plan, which borrows heavily from the USD15-billion United States-led European Recovery Programme following the devastation of World War II, aims to support economic revival in South Sudan, the Democratic Republic of the Congo, Kenya, Tanzania, Rwanda and Uganda, countries in which the lender is present. The plan, which is backed by over USD450-million worth of loan guarantees by development financial institutions, targets micro, small and medium-sized enterprises (MSMEs). These are in key sectors of the economy like manufacturing, agro-processing, education, low-cost building and construction and the retail and wholesale trade sectors. “We have realised that the power we have can keep the lights of these economies on. We have already done a pilot test of this programme with local [small and mid-size enterprises] and what we are doing is just up-scaling the programme across the region,” James Mwangi, the bank’s chief executive told The EastAfrican.
Source: The EastAfrican
EABC roots for 35% tariff rate for imported goods
The East African Business Council (EABC) is urging partner states to adopt a 35% maximum common external tariff (CET) rate for imported goods. The proposed tariff will not only spur industrial development in the region but protect nascent industries from unfair competition. Industries within the East African Community (EAC) bloc would be safeguarded against cheap and subsidised imports and jobs, the apex body of private sector associations said, adding, “Adopting a 35% maximum tariff rate will attract investments in industrial production value chains and transform the bloc into an export-led industrial economy.” EABC executive director John Bosco Kalisa said the proposed 35% tariff rate provides an adequate tariff differential required to incentivise industrial development in the region. The proposal of 30% will create just a 5% tariff differential with the third tariff band of 25% while the 35% will create a tariff differential of 10% which will safeguard products that are sufficiently produced in the region against similar cheap imports.
Source: The Citizen
Regional business body inks deal to attract more US investments
The East African Business Council (EABC) on Wednesday, 10 November signed a Memorandum of Understanding with the Africa Global Chamber of Commerce (AGCC) to lure more investments from the United States into the six-member East African Community (EAC). The agreement outlines several areas of collaboration including showcasing trade and investment opportunities in the EAC bloc, industrial exchange programmes and trade missions to the US, joint exhibitions and conferences, training programs and certifications. John Bosco Kalisa, the EABC CEO, said: “EABC and AGCC partnership is set to improve joint ventures, production capacities and technology transfer between businesses in East Africa and US.” The new partnership is set to boost trade and attract more US investments in industrial parks, special economic zones, export processing zones in the EAC and unlock market access to the US through the African Growth and Opportunity Act, environmental and climate change innovations and co-organising the East African Business and Investment Summit 2022.
Source: The New Times
Non-bank sector’s profits reach BWP2-billion
The Non-Bank Financial Institutions Regulatory Authority's (NBFIRA) 2021 Annual Report released recently indicates that the sector’s profits largely came from the insurance and capital markets players. Non-bank financial institutions also include microlenders, retirement funds, the Botswana Stock Exchange and others. Available data trends have previously indicated that the financial sector was generally resilient in the face of COVID-19’s impact, with insurance and pension funds performing well, while the capital market players also enjoyed stellar returns from offshore equities. In 2020, total assets of the non-bank financial institutions grew to BWP129-billion, or 2.5% higher than the prior year. With those numbers, the sector retained its dominant share of the broader financial sector, with nearly 54% of assets. Retirement fund assets continued to dominate the non-bank financial sector’s assets, with a market share of more than 70%.
Ethiopia / Kenya
Safaricom invests initial KES67-billion in Ethiopia unit
Safaricom is investing an initial KES67-billion (USD600-million) in Ethiopia where it is setting up a new telecommunications operation in partnership with other firms, including its parent company, Vodacom Group. The amount represents the telco’s contribution to the start-up costs and operating licence for which the consortium paid USD850-million (KES94.9-billion). Safaricom is the majority shareholder in the Ethiopian business with a 55.7% equity. The consortium will also spend more on infrastructure and other costs to operationalise the business. “We are expecting a capital expenditure of between USD1.5-billion (KES167-billion) and USD2-billion (KES223-billion) over the next five years to meet the licence coverage obligations,” Safaricom’s chief executive Peter Ndegwa said of the additional Ethiopia investments. “Together with our partners we have availed funding to support this new venture, which we anticipate to break even by year four of operations. Our break-even target may be significantly impacted by the impact of the current conflict on the launch of operations, which we target by mid-2022.”
CBK warns of loan rationing over CRB freeze
The Central Bank of Kenya (CBK) has warned that commercial banks could restart rationing loans following the suspension of blacklisting of defaulters with KES5-million loans and below. The caution came even as the banking regulator gave the nod to the moratorium on negative listing of borrowers with loans below KES5-million with credit reference bureaus (CRBs) for a year, cutting credit information in the banking sector. CBK governor Patrick Njoroge said on Monday, 8 November, banks may shun lending to individuals and small traders at a scale last witnessed between September 2016 and November 2019 when Kenya capped interest rates. Bankers say a lack of credit reference information could contribute to soaring costs of loans and stall lending to businesses due to incomplete borrowers’ information. President Uhuru Kenyatta on 20 October announced the suspension of CRB listing for loans that were defaulted from October last year, with the relief set to last till September next year. The CRB listing relief is part of a stimulus package to cushion distressed businesses and households from the effects of the COVID-19 pandemic, which has hit consumer demand and forced businesses to shed jobs and cut back their operations.
Source: Business Daily
Kenya / Ethiopia / Somalia
KRA pushes for increased legal trade between Ethiopia, Somalia
The Kenya Revenue Authority (KRA) plans to establish posts at Rhamu and Mandera on the Ethiopia and Somalia borders respectively. It will also put up a trade facilitation centre at Suftu, (Kenya-Ethiopia) and construct two bridges to facilitate movement of goods and persons across the borders. The establishment of one-stop border posts is expected not only to spur growth in import and export trade but also provide an opportunity for legitimate trade and revenue collection. Commissioner for Customs and Border Control Lilian Nyawanda said the KRA seeks to facilitate faster movement of goods and persons at the Kenya-Ethiopia border, and facilitate cross-border trade between Kenya and Somalia. “Kenya, Ethiopia and Somalia have long and porous common borders, with many potential locations for developing border posts to facilitate cross-border trade,” Nyawanda said in a statement. This comes with the construction of a major road connecting the Horn of Africa countries. The Horn of Africa Gateway Development Project (HoAGDP) road connects Kenya to Somalia and Ethiopia.
Source: The Star
Lack of debt transparency worries World Bank
A World Bank report has bemoaned lack of debt transparency in low-income developing countries (LIDCs) such as Malawi. According to the recently released report, lack of transparency on debt issues threatens low-income countries’ ability to generate resilient and inclusive recovery. The report says nearly 40% of LIDCs have neither published debt data on their websites nor updated their debt data in the last two years. The report further says, when such data are available, it is only limited to central government loans and securities and excludes other public sector components and debt instruments. When addressing the United Nations General Assembly this year, President Lazarus Chakwera, who is also LIDCs president, asked developed economies and multilateral lending institutions to consider cancelling debts owed by poor countries including Malawi. Chakwera’s remarks come at a time Malawi’s debt levels have astronomically risen to MWK4.1-trillion in recent years. Meanwhile, the Centre for Social Accountability and Transparency executive director Willy Kambwandira has challenged the government to address long-standing concerns about debt transparency and open up to Malawians on debt levels.
Source: The Times
Namibia exceeds interest payment benchmark
Namibia’s interest payments on debt as a percentage of revenue increased from 11.9% to 13.2% in the 2020/21 financial year. The current level of interest payments exceeded the statutory benchmark of 3.9% of GDP, and 10% of the revenue set out in the Debt Management Strategy 2018-2025. “The increase in interest payments is due to significant increase in borrowing to fund the budget deficit, resulting from the outbreak of COVID-19,” stated the Minister of Finance Iipumbu Shiimi, during the recent mid-year budget review for the FY2021/22 and fiscal policy statement FY2022/23 to FY2024/25 Medium Term Expenditure Framework (MTEF) in the National Assembly. According to him, total revenue and grants for FY2020/21 is recorded at NAD57.8-billion, representing a decrease of 1%, compared to NAD58.4-billion realised in FY2019/120. “The decrease in revenue was recorded in the main tax categories of income tax on individuals that decreased by 2.7%, value-added tax (VAT) fell by 24.9%, other taxes on income and profits shrank by 23.2%, withholding tax on interest decreased by 18.1%, while other taxes income category fell by 10.6%. The only income category which showed strong growth was the taxes on international trade and transactions (Southern African Customs Union),” indicated Shiimi.
Source: New Era
Namport sets its sights to becoming a green hydrogen export hub
The Namibian Ports Authority (Namport) has signed a Memorandum of Understanding with the Port of Rotterdam. This is in line with Namibia’s recent policy decision to position the country as a hub for the production and distribution of green hydrogen for Europe and the rest of the world. This is premised on the fact that Namibia is amongst the top three countries on earth that have the world’s best wind and solar resources which are used to produce green hydrogen and has great expanses of open land that are suitable for hosting green hydrogen plants. Green hydrogen is the key to future environmentally friendly energy requirements while the immense capital and resources attendant to the implementation of the green hydrogen revolution would be great enablers to employment creation among Namibians and the drive towards economic sustainability. Namport has taken note of the great benefits that stand to accrue to the country and the region from the adoption and rollout of green hydrogen energy and the need to position their ports to facilitate the movement of project materials and other components initially during the construction phase of the projects and, the future export of the hydrogen and other by-products to international markets.
Source: ESI Africa
Namibia / Botswana
Namibia, Botswana discuss technical framework on one stop border post
Namibia and Botswana recently discussed the technical framework of the implementation of a one-stop border post initiative at the Mamuno and Trans Kalahari border gates. The executive director of Trans Kalahari Corridor Secretariat Leslie Mpofu during a virtual meeting said these negotiations are critical because they pave the way for the conclusion of the One-Stop Border Post Agreement and its implementation, making it the first of its kind in the Southern African Customs Union (SACU) region and the third in the Southern African Development Community (SADC) region. For her part, Boikanyo Mathipa from Botswana’s Ministry of Finance and Economic Development decried the fact that the two countries have stayed for a long time without progressing with the negotiations since their last meeting in August 2013. She said she hoped that the agreement will be concluded soon and pave way for the development of the border post. She further informed the meeting that the Parliament of Botswana enacted the border post legislation in 2013. Implementation will follow after the line ministers from Botswana and Namibia sign the document.
Source: Namibia Economist
Africa loses NGN8.8-trillion yearly to 94% importation of pharmaceutical, medicinal needs
Pharmacists under the aegis of the Pharmaceutical Society of Nigeria (PSN), have said Africa loses at least USD16-billion (NGN8.8-trillion) yearly to 94% importation of its pharmaceutical and medicinal needs. They also called for stronger legislation and empowerment to sanitise the drug distribution system in Nigeria. Former Minister of State for Petroleum Resources and chairman of the 94th Annual General Meeting and Scientific Conference of the PSN in Port Harcourt, Rivers State, Odein Ajumogobia, tied the figure to a recent United Nations Economic Commission for Africa (UNECA) estimate. He said: “This is a terrible indictment and highlights the need for research and policies that will promote increased growth, equitable distribution and retention, especially in the underserved North East and North West states.” He said the pandemic had once again highlighted the need for a more effective structure of drug manufacturing, importation, distribution, administration and control in view of the current reliance on foreign sources for not only finished drug products but also pharmaceutical raw materials, reagents and manufacturing equipment for safe, efficacious and good quality drugs to meet the health needs of Nigerians.
Source: The Guardian
Tanzania aims to fast-track approval of USD30-billion LNG project as critical talks start
Tanzania, Shell and Equinor have started negotiations on a critical host government agreement (HGA) needed to underpin a USD30-billion liquefied natural gas (LNG) project. With Tanzania’s minister of Energy targeting a rapid final investment decision, news of these talks came days after China’s CNOOC International committed itself to both the Kingfisher oil development in Uganda and the USD3.5-billion East African Crude Oil Pipeline (EACOP). The pipeline will transport billions of barrels of oil from Uganda to the Tanzanian port of Tanga. If the project is sanctioned in 2022, it is feasible for the project to go online in 2026, according to its backers. A government delegation led by Energy Minister January Makamba recently began talks with all the proponents of the challenging LNG project which involves transporting gas held in three deepwater blocks to a landfall at Lindi where a 10 million tonne per annum liquefaction plant is set to be built.
Tanzania / Poland
Poland: These are the areas we want to invest in, in Tanzania
Poland has outlined areas that its companies are interested in investing in Tanzania in a bid to strengthen ties and explore existing potentials between the two countries. Poland Ambassador to Tanzania Krzysztof Buzalski recently told The Citizen that Polish companies were closely looking at the investment opportunities on the Tanzanian market in such areas as agriculture, blue economy, mining, tourism and information and communications technology (ICT). However, he said there was still a lack of information on the possibilities of cooperation between the two countries. Compared to what has been done in other African countries, Tanzania and Poland still need extensive trade promotion such as trade fairs and organised presentations. “Tanzania needs more promotion in Poland regarding the trade and business opportunities,” said Mr Buzalski in an interview. “Opening of a Tanzanian diplomatic mission in Warsaw would clearly help build interest in Tanzania, its market opportunities as well as its tourist attractions among Polish business, organisations and Poles in general,” he said.
Source: The Citizen