Non-tariff barriers to trade (NTBs) or sometimes called Non-Tariff Measures (NTMs) are trade barriers that restrict imports or exports of goods or services through mechanisms other than the simple imposition of tariffs. The Southern African Development Community (SADC) defines a non-tariff barrier as any obstacle to international trade that is not an import or export duty. They may take the form of import quotas, subsidies, customs delays, technical barriers, or other systems preventing or impeding trade." According to the World Trade Organisation, non-tariff barriers to trade include import licensing, rules for valuation of goods at customs, pre-shipment inspections, rules of origin ('made in'), and trade prepared investment measures. One of the reasons why industrialised countries have moved from tariffs to NTBs is the fact that developed countries have sources of income other than tariffs. This explains the fact that most developing countries still rely on tariffs as a way to finance their spending. Developed countries can afford not to depend on tariffs, at the same time developing NTBs as a possible way of international trade regulation. The second reason for the transition to NTBs is that these barriers can be used to support weak industries or compensation of industries which have been affected negatively by the reduction of tariffs. The third reason for the popularity of NTBs is the ability of interest groups to influence the process in the absence of opportunities to obtain government support for the tariffs. With the exception of export subsidies and quotas, NTBs are most...

https://www.youtube.com/watch?v=E9JQoWHUHGg

African countries are facing a dual crisis – the impact of COVID-19 on their populations and the global economic slow-down which threatens to undo the hard-fought gains of the last 25 years Nestled in the undulating hills of central Ghana is a Fair Trade cooperative cocoa farm that produces chocolate for export to the world, including to supermarkets across the UK. When I visited the farm last summer, I saw for myself the many jobs the farm provides – many taken by women – and the families that these support. Consumers of the chocolate that originates from Ghana include, no doubt, thousands of workers in my constituency of Stafford, like those in the General Electric factory in Stafford. They manufacture transformers for the energy grid across the globe, including in developing countries like Ghana, where electricity supply can often be insecure or not available. That’s how trade works. Both sides win. For the UK and Africa, our two-way trade has enormous value – a total of £35.1bn of goods and services in 2018 according to ONS – creating and sustaining countless jobs across our country and on the continent. The Prime Minister has been quick to seize the opportunity. At the inaugural Africa Investment Summit in London earlier this year, he promised to renew our economic partnership with Africa, containing some of the fastest-growing economies in the world. Today, however, African countries are facing a dual crisis – the impact of COVID-19 on their populations and the global economic slow-down...

CEGA is committed to sharing a diversity of voices and perspectives. This post, written by Anthony Mveyange (EASST Fellow, TradeMark Africa) and Andrew Mold (United Nations Economic Commission for Africa), was originally published on the Brookings Institution website. Recent global trends like the COVID-19 pandemic, the climate change crisis, and heightened trade disputes among the world’s leading trade partners have highlighted the vulnerability of global value chains (GVCs). At present, the scale of the disruption in East Africa is quite dire — imports from China (a common source of intermediate goods) through the Mombasa Port declined by a drastic 20 percent shortly after the onset of the pandemic, between January and February 2020. In light of these trends, governments and industries in East Africa should consider rapidly shifting from focusing on global value chains (GVCs) to regional ones (RVCs). Given the region’s past difficulties with entering global value chains and consolidating the gains from regional integration processes, heightened emphasis on regional value chains could reap compounding benefits. The time is ripe: As documented in our recent report, the recently signed and ratified African Continental Free Trade Area (AfCFTA) can be the great enabler of that shift. THE STAGNATION IN GVCS The literature on GVCs emerged in the 1990s, after which the development community began to frame development success in terms of the ability of countries to insert themselves into these GVCs. Although not uncontested, academic research provided evidence of the benefits to workers and improved prospects for poverty reduction from participating in GVCs. However, the...

On February 27, Nigeria confirmed the first case of Covid-19 in Sub-Saharan Africa. Since then, the virus has spread to all corners of the continent. Even before the first cases were recorded in Africa, Covid-19 was already impacting international demand for exports in key sectors such as textiles and horticulture. Flower exports are down by more than 90 per cent and tourist arrivals have ground to a halt. The Kenya National Bureau of Statistics reported that imports dropped by more than 20 per cent in the first two months of 2020, with Chinese imports plummeting around 37 per cent. As the pandemic continues, the projected losses grow. Trade volumes in the EAC are down by up to 25 per cent since the beginning of 2020, with even greater reductions in the informal sector. African countries, conscious of the fragility of their public health systems and limited intensive care capacity, have instituted strict measures to stem the spread of the virus. However, for many in the region, their livelihood depends on moving about freely. There is no work-from-home option for the hundreds of thousands of small-scale traders. A day of work missed often translates to a day without food on the table. While health considerations are of primary importance, the prospects for tackling the challenges the pandemic presents are inextricably linked to trade and the economy. Continued trade at this time is crucial for three main reasons. First, trade is essential in ensuring people and governments have what they need to...

The Acting Chief Trade Negotiator/Director General, Nigerian Office for Trade Negotiations, Mr. Victor Liman, has said that the African Continental Free Trade Agreement (AfCFTA) is now expected to commence from January 1, 2021.Speaking on Nigeria’s Channels Television programme on Thursday, Liman  said that the AfCFTA, which was earlier scheduled to kick-off on July 1, 2020, was postponed due to the ravaging impact of COVID-19 pandemic on Africa. The Continental trade agreement entered its operational phase on July 7, 2019, following the ratification by 54 of all the 55 African countries. Liman disclosed that the Extraordinary Africa Union Summits scheduled to hold in South Africa on May 30, 2020 has been postponed to December 5, 2020. According to Liman, the summit is aimed at encouraging trade negotiators to complete their bargaining on tariff reductions, rules of origin and other necessary regulations and that the new date will also give sufficient time for trade ministers and their experts to finalise negotiations and prepare adequately for the Summits. The agreement for the largest regional market in the world was organised by the African Union and signed on by 44 of its 55 member states in Kigali, Rwanda on March 21, 2018. Source: Journal du Cameroun

The International Monitory Fund (IMF) executive board on Wednesday approved a total of $1.23 billion (about Sh2.8 trillion) to help two East African Community (EAC) member states in addressing the economic impact of Covid-19.The money will be disbursed under the IMF’s Rapid Credit Facility. The RCF provides rapid concessional financial assistance with limited conditionality to low-income countries (LICs) facing an urgent balance of payments need.It (the RCF) was created under the Poverty Reduction and Growth Trust (PRGT) as part of a broader reform to make the IMF’s financial support more flexible and better tailored to the diverse needs of LICs, including in times of crisis.Out of the $1.23 billion, Uganda will receive $491.5 million while Kenya will pocket $739 million.This brings the total number of EAC member states that have so far received IMF funding for Covid-19 to three.Last month, Rwanda became the first African country to benefit from the IMF’s RCF when it secured $109.4 million in emergency coronavirus funding.Across the region, the Democratic Republic of Congo, Malawi and Mozambique have already benefited from the funds.A few days ago, the IMF approved a $91 million loan for Malawi to help fund a balance of payments deficit exacerbated by the Covid-19 pandemic, the Fund said in a statement. Towards the end of last month, the IMF executive board approved a disbursement of $363 million under its RCF to help Democratic Republic of Congo confront the impact of the Covid-19 pandemic.During the same period, the IMF approved $309 million to help...

Truck drivers will first have to obtain a certificate from the Ministry of Health confirming that they are Covid-19 free before being allowed to travel outside the country, Transport Cabinet Secretary James Macharia has said. Mr Macharia, during the daily briefings on the current coronavirus situation in the country at Afya House on Wednesday, further said that the drivers will be tested 48 hours before their scheduled travel. TRANSMITTING VIRUS The transport sector is a key area in terms of transmission of the disease. “As we said before public transportation is a very key area in terms of both transmission and also facilitation economic development. You have heard before about the risk of having truck drivers especially the ones carrying cargo into the country transmitting the virus, say from Mombasa going to the west in Malaba and going to other countries in the region,” Mr Macharia said. “So as a region we have agreed that henceforth all truck drivers leaving for example our country going to neighbouring countries, have to be tested at least 48 hours before they leave Nairobi or Mombasa. That is important because by the time they get to Malaba they have to show the certificate that they are Covid-19 free and that will be mandatory. This also applies to drivers coming from Rwanda,” Macharia said. VALIDITY AND RENEWAL The truck drivers will also have to show the certificate at the Mombasa port and other facilities they go to, to carry transit goods. “All drivers going into...

Kenya Railways has dispatched a set of train wagons to the Nanyuki terminus to be used in the ongoing repair of the 240km metre-gauge railway line in Central Kenya.The wagons, which were offloaded in the town on Tuesday, were transported to the terminus by road and are expected to ease the refurbishment works. KR Managing Director Phillip Mainga accompanied senior staff from Nairobi and held a meeting with Nanyuki-based Railways officials. Mr Mainga said the wagons included two low-sided wagons for ferrying murram and tools, and two hopper wagons for ballast. The wagons, which were offloaded in the town on Tuesday, were transported to the terminus by road and are expected to ease the refurbishment works. KR Managing Director Phillip Mainga accompanied senior staff from Nairobi and held a meeting with Nanyuki-based Railways officials. Mr Mainga said the wagons included two low-sided wagons for ferrying murram and tools, and two hopper wagons for ballast. The second team is working from Nanyuki towards Nyeri and Sagana. Mainga said the team had arrived to carry out inspection and one of the challenges observed was drainage systems that had been exposed by the heavy rains.Currently, the works include clearing of drainage and murraming along the railway tracks. “The line from Nanyuki to Sagana is in fairly good condition and we are hopeful that we shall complete the works along the route within the next two months,” he said. He urged communities along the Nairobi-Nanyuki line and the public in general to be aware...

Freedom of movement and economic integration are the cornerstone of the African Union’s (AU) Agenda 2063 which includes, among other things, the progressive aim of abolishing visa requirements for all African citizens. However multiple obstacles to free movement on the continent persist. A protectionist approach to managing migration still prevails as states avoid ceding their sovereignty to regional and supra-national organisations in migration affairs in the name of state security and national interest. So far, with the exception of the Economic Community of West African States (ECOWAS), little tangible progress has been made to implement a free movement regime. In this context, the global COVID-19 pandemic and states’ responses to it, raise questions about open borders and free movement of people. By 29 April, more than 34 000 people in Africa were infected with the coronavirus and just over 1 500 had died. If governments struggle to contain the spread, strict immigration laws and the militarisation of border control may be invoked, as has happened in South Africa. These types of measures would be antithetical to the continent’s integration agenda. More than half of African countries have closed their borders to human traffic in response to COVID-19 As the pandemic flared up across Europe, borders were progressively shut down until the Schengen agreement was suspended. At the same time, populists have challenged the European Union (EU) borderless system in an attempt to crack down on immigration. French right-wing politician Aurélia Beigneux went further: ‘The free circulation of goods and people,...