eeeeeTTTTTrrrrradequityadequityadequityadequityadequityA Newsletter of CUTS AfricaA Newsletter of CUTS AfricaA Newsletter of CUTS AfricaA Newsletter of CUTS AfricaA Newsletter of CUTS Africa

Year 12, No. 2/2013

Private sector competitiveness andimprovements in the business

environment in which the private sectoroperates remain essential for tradeexpansion, economic development, jobcreation and poverty reduction in today'sdevelopment paradigm. Essential inputsin production such as fuel and electricityas well as reducing barriers to market entryand improving the regulatory frameworkto facilitate smooth operations are key tocreating an enabling environment forentrepreneurship to play its role as themain driver of sustainable development.

Zambia is no exception as an LDC makingefforts towards achieving inclusiveeconomic development. However, in lightof recent developments in the immediateremoval of fuel subsidies, fuel prices hikeis causing a sudden increase in productioncosts and affecting the planning of privatesector players.

In order to maximise economic growthand foster a robust entrepreneurial sector,there is need for a clear, predictable andminimally intrusive legal and policyframework. In Zambia, there have beenseveral factors that contribute to improvingthe business environment including theremoval of barriers to business creation andoperations, improvement of rules andregulations as well as the reduction ofbarriers to trade though trade policydevelopment and trade facilitation.

It cannot be overemphasised that reducingthe cost of electricity, fuel and other inputsis critical to the private sector. Thegovernment should also strive to be moreproactive in public private dialogue priorto the introduction of legislature that willimpact the private sector rather thanengaging them after it has already beenintroduced as has been the case with fuelrecently.

Fuel Hikes Can Hurt Entrepreneurship

CUTS AfricaEmail: lusaka@cuts.org (Lusaka)

Email: nairobi@cuts.org (Nairobi)Email: accra@cuts.org (Accra)

Website: www.cuts-international.org/ARC

I N T H I S I S S U E

AfDB Outlines Growth Strategy ......... 2

Obama to Discuss Trade, Investment .. 3

Funds to Boost African Trade .............. 4

Merger of Three RegionalMarket Blocs ....................................... 5

Fuel-Electricity Tariff Hikes ................. 6

This echoes with the sentiments made bythe Zambia Association of Manufacturers(ZAM) during their meeting on 'Creatingan Enabling Environment for SocialEconomic Development' which aimed atcreating a platform for dialogue betweenpolicymakers, manufacturing fraternityand key influential groups on recentpolicy developments.

During the event, ZAM President DrBright Chunga said that governmenttends to present policy guidelines that areunpredictable and lack consistency. He,therefore, stressed on the need for policyadherence and predictability for allplanning. He also brought out the factthat the centralised procurement of oil stillremained a challenge. He was of the viewthat the monopoly that government holdson oil could also be a reason for the existinghigh fuel prices. He hoped that financialgains made from the policy decisions madeby the government would be channelledto developmental projects that would helpthe country register positive economicgrowth.

Tommy Singongi, Acting CentreCoordinator, CUTS International Lusakasaid that the removal of subsidies hadalready impacted the consumernegatively. He pointed out that in orderto maximise economic growth, there isneed for a clear, predictable and minimallyintrusive legal framework.

Meanwhile, CUTS International Lusakahas created an e-discussion forum calledCUTS Development Forum Zambia as aplatform for policy dialogue ondevelopmental issues. Already membersof the public have been debating thechallenges Zambia is facing on fuel pricing.

Alan Witworth a private consultant saidon the forum that few Zambians realise

that most of the benefit of GRZ subsidies(fuel, fertiliser, electricity) go to relativelywealthy Zambians not to the poorest. Hesuggested that even if poor only benefit alittle from subsidies they will still losesomething if the subsidies are removed.He said it is important to realise that GRZpays for subsidies either by reducingexpenditure on something else or byborrowing extra money (which has to berepaid in future).

But Yusuf Dodia, Chairperson, PrivateSector Development Associationresponded and said that May 2013 fuelprices in the sub region show Zambiatopping the chart as highest cost country.He said that clearly, Zambia has just madeitself non-competitive in the region andwe should expect our industries to grindto halt and our traders to fill in the gap aswe import from our cheaper neighbours.Actually, the entire Sixth NationalDevelopment Plan (SNDP) Mining,Agriculture, Tourism, Manufacturing, andServices sectors are all under threat.

CUTS New Centre@Accra (Ghana)

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Economics and Development

WorldEconomicForumonAfricaAfrica is forging ahead. Sustained

growth has strengthened its leaders'resolve to stay on a path of reform, even ifsometimes the pace is slower than onemight wish.

According to the World EconomicForum's Global Competitiveness Report,13 sub-Saharan African (SSA) economiesranked among the top 100 mostcompetitive in the world in 2012.However, the region also accounted for14 of the bottom 20 in the league table.

Boosting competitiveness is key. Nowthat Africa's leaders can see that theirmacroeconomic policy and fiscal reformsare working, these initial steps need to befollowed up with solid progress in thefields of infrastructure, education andinstitution-building.

(www.thisisafricaonline.com, 08.05.13)

SA-Japan to Push InvestmentSouth Africa's Department of Trade

and Industry (DTI) and Japan's MizuhoCorporate Bank Ltd have signed acooperation agreement to promote anddevelop economic and industrial co-operation between the two countries.

The agreement was signed in Tokyoduring South African President JacobZuma's official visit to the Asian country.Trade and Industry Deputy Director-

General Pumla Ncapayi said that, in termsof the agreement, the DTI and Mizuhowould pool their information resources inorder to promote investment developmentbetween South African and Japanesecompanies. (www.southafrica.info, 06.06.13)

Africa is Rising!Africa is at a turning point. For the

first time in a generation, the optimisticview looks to be correct that Africa is atlast truly rising. Despite the slowdown inthe global economy, Africa is reporting 6.6percent growth in 2013. Exportperformance and inward investment arestrong.

Intra-African trade and investment isgrowing. African cities are boomingbehind strong retail demand for goods andservices. Gross domestic product (GDP)has multiplied five times in 20 years.

Africa's per capita GDP has crossedthe US$1,000 barrier. Mortality is down,life expectancy is up. Seven out of 10Africans own a cellphone. In fact, thereare now more cellphone subscribers inAfrica than in North America and Europeput together. (www.bdlive.co.za, 29.05.13)

Supporting Small-Scale FarmersThe Zambia National Farmers Union

(ZNFU) has observed that conservationof farmers face a number of challenges in

accessing loans from financial institutionsfor growth of their business.

Speaking during the tractormechanisation field day held in Chongwe,ZNFU first Vice President EvelynNgulekaurged the government not to relent inproviding small scale farmers with supportto ensure food security.

Bob Sichinga, Agriculture andLivestock Minister has called forcontinuity of the tractor mechanisationscheme loan programme and ensurefarmers have access to tractors.

(www.muvitv.com, 28.06.13)

Angola Plans Diamond Industry"Angola intends to develop its

diamond industry beyond mining tocutting and polishing stones and creatinga large jewellery manufacturing sector",said Francisco Queiroz Geology and MinesMinister.

He said that the government believesthe diamond industry can play a large rolein the economic development of thecountry by providing employment andcontributing further funds to thegovernment through taxes and royalties.

The country is believed to have 1,000diamond areas but has just three mines,including the Catoca mine whichproduces 87 percent of Angola'sdiamonds. As a result, the country wouldlike to enter into cooperation agreementswith foreign and domestic investors todevelop the sector.

(www.idexonline.com, 20.06.13)

WB Survey Ranks Kenya HighlyThe World Bank (WB) has praised

Kenya's private sector saying it is the mostvibrant and dynamic in the East AfricanCommunity (EAC).

Despite Kenya being ranked 121 outof 183 countries by the WB's DoingBusiness Report of 2012, down from 78in 2008, Kenya has a developed textileand apparel industry that exports to theUS market under a preferential tradeagreement.

Kenya has made the greatest strides inallowing free movement of labour acrossthe region, according to new findings bythe East African Business Council. Themovement of goods and services in EastAfrica is expected to improve as Kenyaand Uganda roll out online cargo clearancesystems. (BD, 04.06.13)

AfDB Outlines Growth Strategy

The African Development Bank Group (AfDB) has, following board approval anda lengthy consultation process, released a new ten-year Africa-focused development

strategy for 2013-2022, which focuses on the economic transformation of the continent.The strategy identified

infrastructure development, regionaleconomic integration, privatesector development, governanceand accountability, and skillsand technology as the fiveprimary "channels"through which thebank would aim tobolster growth inAfrica.

It would furtherseek new ways ofmobilising resourcesin support of thecontinent's transformation, most particularly through leveraging the continent's ownresources. The AfDB planned to attract new investors through the wider use of public-private partnerships, co-financing arrangements and risk-mitigation instruments.

(ENO, 01.05.13)

www.new

times.co.rw

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News on TradeEnhancing Trade Facilitation

The Zambia Revenue Authority(ZRA) representing the public sector ofZambia launched the Zambia Customsto Business Forum to address concernsfrom the private sector regarding customsoperations with the view to enhance tradefacilitation.

The overall purpose of Customs toBusiness partnerships is to ensure apartnership and dialogue structure of keyplayers in the trading chain that contributesto trade facilitation, improvements incustoms operations and higher complianceby the trading community.

The Forum aims to facilitate a strongerpartnership between Customs andBusiness at the National level, therebypromoting a regular and results focuseddialogue, and taking action on existingchallenges and areas of development inthe country. (ZAM, 30.04.13)

EU-SA Trade TiesThere is growing optimism that the

countries of Southern Africa are withinmonths of concluding negotiations withthe European Union (EU) on a major newtrade deal, after years of hesitant progressand frustration.

The EU Ambassador in Pretoria,Roeland van de Geer, said that theagreement would form part of the bloc'sstrategy of clinching regional trade pacts,known as Economic PartnershipAgreements or EPAs.

There are different EU tradearrangements for South Africa'sneighbours, depending on their degree ofdevelopment, with the greatest accessaccorded to the least developed states.

(IPS, 19.04.13)

Trade Infrastructure still ColonialAll roads in Africa still lead to former

colonialists. This explains why intra-African trade only amounted to 13.1percent of the continent's total trade.

According to Professor Adrian Saville,the infrastructure of most Africancountries is still geared to transportinggoods to ports and out of the countryto former colonial countries or thedeveloped world, not to connect Africancountries

Africa's intra-trade figures are, to quoteVisa, 'exceptionally low', especiallycompared to World Bank data, whichplaces intra-trade for South-East Asia andEurope at 50.2 and 72.1 percent of thetotal respectively.

The lack of trade between Africancountries has had a serious effect on thecontinent's development and, while it isgrowing very slowly, it will continue toprevent real GDP growth.

(Mail & Guardian, 24.06.13)

Zim's Trade Deficit to WorsenZimbabwe's trade deficit will worsen

to over US$3bn by the end of 2013 afterthe balance of trade in the four months toApril widened to US$1.6bn as thecountry's reliance on imported goods andservices grows, latest statistics show.

According to the figures released bythe Zimbabwe National Statistics Agency(Zimstat), total imports recorded betweenJanuary and April 2013 were US$2.6bnagainst exports of US$1bn giving rise to acumulative trade deficit of US$1.6bn.

The latest Zimstats figures show thatimports are heavily weighted towardsmotor vehicles and foodstuffs.

(www.allafrica.com, 28.06.13)

ICT to Attract InvestmentThe Malawi Government's Ministry

of Trade and Industry says the time hascome for the country's trade sector toembrace ICT in its dealings if it wants toattract more foreign investment.

Minister of Industry and Trade, SostenGwengwe said this can best be achievedif government of Malawi put up aUS$40mn National Single Window(NSW) facility, an automated Informationtransaction system through which a tradercan submit electronic trade declarationsto various authorities for processing andapproval in a single application.

Ministry of Trade and Industry'sspokesperson, Wiskis Nkombezi said theNSW will help the country overcomechallenges faced by the businesscommunity associated with the complexsystem of data submission and regulatorycontrol. (BA, 05.06.13)

Zambia-Angola Trade PactWestern Province Permanent Secretary

Emmanuel Mwamba has said there wasneed to put in place measures that willharness border trade and developmentbetween Zambia and Angola inShangombo district.

He explained that both Angola andZambia should strengthen their ties evenat local level through cooperating inprogrammes of development, trade andagriculture.

He said the plans to put up apetroleum pipeline from Luanda toRivungu and the construction of a road,bridge and railway line by the Angolangovernment will boost trade anddevelopment of both Rivungu andShangombo districts. (LV, 14.06.13)

Obama to Discuss Trade, Investment

US officials say SSA is a centre of global growth, hometo many of the world's poorest people, and a place

where US business investment and trade could help boosteconomic expansion. Trade within Africa and with the USis up and could grow more.

US officials say rising African incomes and a growingmiddle class could boost demand for American-madeproducts, and help create jobs in the US.

But China has more trade with African nations, andsome critics of US policy say Beijing has made the continentmore of a priority, and rarely imposes the kinds of politicalconditions on investments that come with some US deals.

(VOA, 27.06.13)

www.presseurop.eu

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News on Trade

Kenya, Uganda to Clear GoodsThe movement of goods and services

in East Africa is expected to improve asKenya and Uganda roll out online cargoclearance systems. Uganda RevenueAuthority (URA) said that it is pilotingthe Automated Systems for Customs Data(Asycuda) World in an effort to digitise itsCustoms operations to internationalstandards.

The adoption of Asycuda World,which targets goods delivered by air,follows an earlier pilot project done in Jinja,eastern Uganda, for goods delivered byroad. The tax body hopes to fully roll outthe Asycuda World system by December.

At the same time, the Kenya RevenueAuthority and URA are testing anupgraded Revenue Authority Digital DataExchange Systems (Raddex), which willclear goods while still at Mombasa bycreating a link with border Customs unitssuch as Malaba. (TEA, 25.05.13)

Kenya Eyes Revenues from OilKenya is seeking more revenues from

oil and gas explorers with proposedregulations that could see firms pay highertaxes and change the formula forcalculating proceeds to be earned by thegovernment.

Draft regulations prepared by twoconsultants hired by the government andthe World Bank US-based Hunton &Williams and British firm ChallengeEnergy propose a change in the profit-sharing formula and introduce capitalgains tax as part of the conditions explorerswill commit to before they are licensed tooperate in the country.

This will see companies pay taxes ifinvolved in share transactions betweennon-Kenyan entities. (TEA, 01.06.13)

Relevance of WTO for AfricaWhat we are observing in Africa is very

exciting and promising: we are witnessingan unprecedented decade of economicgrowth, supported by economic reformsand regional integration efforts.

As world trade growth slowed downabruptly in 2012, Africa was the only regionwith double-digit growth in exports andimports that year. Although trade has playeda key role in making Africa one of the mostrapidly growing economic regions in theworld, trade should become an even morepowerful tool to enhance prosperity in theContinent, especially in its LDCs. The WTOis essential for the fulfillment of this task.

Unless the African countries have notonly legally bound open markets for theirproducts, but also the technical assistanceand the capacity building required for acontinued growth of their exports, theexport-led growth they have recentlyenjoyed may be compromised.

(www.allafrica.com, 26.04.13)

Trade Key to Poverty AlleviationTrade can be an important catalyst to

poverty eradication. However, this has notbeen true in the African story, especiallytrade within the continent. Worldwide,Africa contributes only three percent toworld trade. This is insignificant and tellingof the poverty levels in the continent.

Trade among African countriesaccounts for 10 percent of the continent'stotal trade balance and it's the leastcompared to trade between the continentand markets like Europe, America and Asia.Trade among African countries has beenlow and not highly regarded. There arereasons to this state of affairs.

First, colonialism played a key role inensuring that Africa was used as a source of

raw materials and not an industrial hub.Second, the intra-African infrastructureis minimal and in a poor state. Take theexample of Kenya. (BD, 23.04.13)

SEZs in the PipelineSouth Africa's Department of Trade

and Industry has identified 10 potentialSpecial Economic Zones (SEZs)countrywide, and will soon beconducting feasibility studies todetermine their viability, says Trade andIndustry Minister Rob Davies.

Davies told the committee that SEZsaimed to promote economic growth andjob creation, by setting up enablingenvironments for developing targetedindustrial activities and attracting bothdomestic and foreign direct investmentin manufacturing and tradeable services.

Davies said that SEZs included freeports, free trade zones, industrialdevelopment zones, and sectordevelopment zones.

(www.southafrica.info, 01.05.13)

Remove NTBs on EACStatesPresident Museveni has asked EAC

member states to put an end to all non-tariff barriers (NTBs), saying they are themain impediments to the economicdevelopment of the region.

Addressing the East AfricanLegislative Assembly, the President alsooutlined economic bottlenecks that havehampered the growth of the region.

Among the bottlenecks are ideologicaldisorientation, attacks on the privatesector, an underdeveloped humanresource, inadequate infrastructure, lackof industries and an underdevelopedagricultural sector, among others.

(DM, 06.06.13)

Funds to Boost African Trade

The China-Africa Business Council (CABC) and the China-AfricaDevelopment Fund (CAD Fund) have decided to set up two new

funds in 2013 to boost China's investment in Africa. One fund is forcommercial ventures, and the other, for mining activities.

Zheng Yuewen, Chairman of CABC, which represents the interests ofmore than 550 Chinese companies in Africa, said each fund will raiseUS$1bn in its initial phase from member companies and the CADFund,China's largest private equity fund focusing on African investments.

The two new funds will provide capital to Chinese enterprises seekinginvestment opportunities in Africa, particularly in the mining sectors,commercial and trade investment. To further strengthen cooperation with Africa, the Chinese government has consistently encouragedcapable State-owned and private companies to invest there. (CD, 14.06.13)

www.secretsofthefed.com

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Regional Round UpEAC want Monetary Union

The EAC Council of Ministers shouldexpedite the conclusion of the protocolestablishing the Monetary Union, EACHeads of State said. Meeting at the 11thExtraordinary Summit of the EAC Headsof State in Arusha, Tanzania, the regionalleaders said technical negotiations as wellas legal issues should be expeditiouslysorted to enable the signing of theprotocol.

The Summit reiterated its earlierdirective to the Council of Ministers toexpedite negotiations and conclusion ofthe protocol on the establishment of theEAC Monetary Union with a view tosigning the protocol at the 15th Summitof the EAC Heads of State scheduled forNovember 2013. (TNT, 30.04.13)

SACU Arrangement Not FairThe Namibia Chamber of Commerce

and Industry (NCCI) has called for greaterprotection of the country's fledglingindustries that are at the mercy of the bigSouth African companies. NCCI PresidentTaara Shaanika said his organisation hassupported the granting of infant industryprotection for some of the sectors inNamibia, as this will allow them to takeoff.

He said that for as long as Namibia ispart of the Southern African CustomsUnion (SACU) where only one memberout of the five-member union has adeveloped industry and manufacturingcapacity, it will be difficult for the otherfour member states to developmanufacturing industries because thismember [South Africa] has a habit ofdumping products therefore othermember states are not able to develop theirown industries. (NE, 11.06.13)

SADC to Lure InvestorsThe SADC will seek to attract

extensive investment in the roll-out of itsRegional Infrastructure DevelopmentMaster Plan Vision (RIDMP) 2027,through a high-level InfrastructureInvestment Conference, in Mozambique,in June 2013.

The RIDMP is a 15-year blueprint toguide the implementation of cross-borderinfrastructure projects between 2013and 2027, and was adopted by SADCheads of State and government at the 32nd

SADC ordinary summit held in August2012.

Priority infrastructure projects worthsome US$500bn had been identified, andthe SADC said it hoped that investorconference on June 27-28, 2013, would,along with other funding road shows inAsia and Europe, mobilise resources fortheir implementation. (ENO, 10.06.13)

EAC Integration HamperedEast African countries should know

their interests, goals and how to protectthem before going for trade negotiationswith developed countries like the US andEU, trade experts have warned.

Experts are bitter with the quality oftrade negotiators in the EAC, saying theyare ill-informed and do not understandnegotiation techniques. This, they said,has seen many EAC negotiators leavingthe talks after being bulldozed by richnations.

At a regional forum on ongoing tradeand investment negotiations, organised bySEATINI Uganda, experts argued that thefive EAC countries should appointknowledgeable trade negotiators torepresent their interests, rather than beshaken by the concerns of the developedcountries. (TO, 07.06.13)

Sustainable Energy for AllSouthern Africa has the potential to

achieve universal access to modern energyservices if the region puts in place a soundand vibrant strategy to harness its huge

Merger of Three Regional Market Blocs

Negotiations on the planned merger of three regional market blocs enter a make-or-break phase next week as member countries table their policy demands on

areas such as customs procedures and rules of origin.The Southern African

Development Community(SADC), the EAC and theCommon Market forEastern and Southern Africa(COMESA) have since2008 been negotiating aroadmap to merge into a freetrade area covering morethan 527 million peopleand a GDP of aboutUS$624bn.

The talks are expectedto deepen when negotiators converge on Kigali to present the preferred policies of therespective countries and blocs on key areas of integration such flow of goods andproducts. (BD, 08.05.13)

renewable energy resources. Meeting inMaseru, Lesotho, the 33rd SADC EnergyMinisters meeting said the developmentof a renewable energy strategy will, amongother things, ensure that the SADC is ableto effectively manage and exploit thenatural resources that are in abundancein the region.

As such, member states should speedup the process of finalising the SADCRenewable Energy Strategy and ActionPlan that was mooted a few years ago.

(SANF 13 No. 14 of 06.13)

Regional Firms Ranked LowThe corporate governance ranking of

firms in Kenya, Tanzania and Uganda fellin 2012, a new survey says, with little orno improvement in the implementationof laws to protect investors. The globalranking placed the three countries behindtheir smaller EAC counterparts Rwandaand Burundi.

The World Bank Doing Business2013 report shows Kenya and Tanzaniashared the same position in protection ofshareholders. Their ranking was tied at100, down from 97; Uganda's fell toposition 139 from 133 in 2012.

The report surveyed 185 economies.The three countries have betterestablished capital markets than Rwandaand Burundi, which were ranked 32 and49 respectively for protecting investors.

(TEA, 06.04.13)

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Environment/Consumer Issues

Awareness onConsumer RightsThe Competition and Consumer

Protection Commission (CCPC) saysraising awareness on consumer rights willnot succeed if left to the commission alone.CCPC Executive Director ChilufyaSampa said that concerted efforts by thegovernment, private sector and othercooperating partners are needed to raiseawareness on consumer rights andobligations.

Sampa was speaking at the launch ofConsumer Unity & Trust Society (CUTS)International Lusaka-Muvi TV consumerawareness campaign on consumer rightsand responsibilities in the health sector inZambia which took place in May, 2013.

(ZDM, 06.05.13)

NCT in Action!The Namibia Consumer Trust (NCT)

wants the Ministry of Agriculture, Waterand Forestry and the Ministry of Healthand Social Services to implementmechanisms for the protection ofconsumers.

The request comes in the wake ofrecent damning revelations that eight outof ten samples of processed meat recentlyfailed DNA tests in South Africa and onlytwo of the samples were found to containthe ingredients listed on their labels. It wasconfirmed that only one of the companieswhose products were labeled incorrectly,has withdrawn its meat products.

(www.allafrica.com, 07.05.13)

Investment in Renewable EnergyInternational Finance Corporation

(IFC) has projected to issue at leastUS$1bn in green bonds a year to supportprivate sector investment in renewableenergy and climate-friendly sectors inemerging markets such as Zambia.

Proceeds from the bonds areearmarked for projects that reducegreenhouse emissions, for example, byrehabilitating power plants andtransmission facilities, installing solar andwind power, and providing funding fornew technologies that result in significantreductions in emissions.

According to the International EnergyAgency, US$5tn of investment is neededworldwide by 2020 in renewable power,energy efficiency, and cleanertransportation to contain rising globaltemperatures. The United Nations

estimates that 80 percent of the capitalneeded to address climate change will comefrom the private sector. (TP, 01.05.13)

Responding toNamibia'sDroughtNamibia, already the driest country

in SSA, is experiencing a severe drought,with some regions receiving the lowestseasonal rainfall in three decades, accordingto figures released by the country'smeteorological service.

President Hifikepunye Pohambadeclared the drought a nationalemergency, following an Emergency FoodSecurity Assessment that found that331,000 people were in need of foodassistance.

Cereal production for 2013 isexpected to be down by an estimated 42percent compared to 2012, according toa government forecast. Pastures for grazinghave also been severely affected in sixregions where many households rely onlivestock production, with 4,000 livestockdeaths already recorded. (IRIN, 30.05.13)

Fake DrugsUndercut ProgressWhen customs officials in Luanda,

Angola, searched a cargo container fromChina, they found something hiddeninside a shipment of loudspeakers: 1.4million packets of counterfeit Coartem, amalaria drug made by Swisspharmaceutical giant Novartis.

Counterfeit drugs shipped from Chinaare threatening to undermine years ofprogress in tackling malaria in Africa. Thediscovery led to one of the largest seizuresof phony medicines ever. The fakes arepart of a proliferation of bogus malariadrugs in Africa that threatens toundermine years of progress in tacklingthe disease.

Massive Western aid programmes havefinanced the purchase of millions of dosesof Coartem and other antimalaria effortssuch as insecticidal nets and spraying.Combined, they have helped bring abouta sharp reduction in malaria fatalities,

(WSJ, 29.05.13)

Rwanda Calls for Health GroupRwanda Premier Pierre Damien

Habumuryemi has hailed theestablishment of the EAC Health ResearchCommission, which would promoteresearch-based decision-making and policyformulation.

Once fully operationalised, thisCommission will be especially resourcefulwith regard to the development ofsustainable regional mechanisms foraddressing issues related to health research,the utilisation of research findings fortechnological and sustainable healthcaredelivery, as well as for translating theresearch findings to policy formulation andpractice within the region.

(www.allafrica.com, 08.04.13)

Fuel-ElectricityTariff Hikes

Hikes in fuel prices and electricitytariffs should be done gradually

to cushion the negative impact onconsumers whose incomes increaseonly by small percentages, saidCopperbelt University business lectureDr. Lubinda Haabazoka.

CUTS International Lusaka saidthe government should review itsdecision to increase fuel prices followingthe scrapping of the fuel subsidy.Simon Ng'ona, CUTS CentreCoordinator also agreed with Dr.Haabazoka's views, saying the removalof subsidies on fuel prices wouldnegatively impact both consumers andproducers.

The government removed fuelsubsidies, effectively hiking fuel pricesby an average of 21 percent. State-owned Zesco has also proposed to theEnergy Regulation Board (ERB) a 25percent hike in electricity tariff.

(CUTS International Lusaka, 05.08.13)

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Special Article

* Editorial Editor, Zambia Daily Mail. Abridged from an article that appeared in the Zambia Daily Mail on June 12, 2013

State of Play in the World Trade OrganizationMartin Kapende*

Trade ministers from more than 159countries will be meeting towards the

end of 2013 in Bali, Indonesia, for theninth WTO Ministerial Conference. Butwhat is worrying is that there is no sense ofany optimism on the outcome from Balibecause the current Round of trade talkshave seemingly hit a snag and havedragged on for twelve years and there isno nearby solution in sight.

There is a foreboding air over the futureof the WTO talks such that delegates areworried that in order to salvage the DohaDevelopment Agenda (DDA), thereshould be some consensus even on theslightest issues in the DDA so that therewill be something to hold on to because ifthere is no consensus in Bali, then whatwill remain on the agenda for the WTO?

To the uninitiated, the DDA is thecurrent trade-negotiation Round of theWTO which commenced in November2001 in Doha, Qatar, with an objective oflowering trade barriers among membersto help facilitate increased global trade.

As of 2008, the talks had stalled over adivide on major issues, such as agriculture,industrial tariffs and NTBs and trade inservices. There are significant differencesbetween developed nations led by the EU,the US, and Japan and the majordeveloping countries led and representedmainly by Brazil, China, India, SouthKorea and South Africa.

On June 03, 2013, WTO DirectorGeneral Pascal Lamy had this to say in astatement entitled: Members approachinglast petrol station before Bali: "We haveabout 40 working days left before the endof July, which I see as the last petrol stationbefore the Bali highway. We must makesubstantive advances in this period if weare to have any chance of successfullydelivering in Bali and preparing a post-Bali roadmap."

The initial DDA has about 21 itemsthat need to be agreed upon but now this

has been reduced to focus only on threepossible deliverables on which there is stillsome hope that consensus may be reachedbefore Bali and these agreements are ontrade facilitation, agriculture and anagreement on Special and DifferentialTreatment (S&DT) as well as leastdeveloped countries (LDC) issues.

On Trade Facilitation, further progresshas been made on improving the draftTrade Facilitation agreement throughnegotiations conducted. The members ofthe Negotiating Group on TradeFacilitation have made some progress. Thegroup also produced convergence on otherparts of the legal text that can hopefullybe turned into consensus during the newphase of negotiations.

But as Lamy noted, progress beingmade is still not fast enough to provideassurance that WTO is on track to producea good result for the ninth MinisterialConference. Lamy's observation is that thekey issue is how to build consensus,especially on those areas which require ahigher level of political intervention suchas customs cooperation and transit, as wellas on other issues such as pre-shipmentinspection.

On S&DT agreement, negotiatorshave intensified work. Ambassadors andheads of delegations are now being

The Doha DevelopmentAgenda is also aimed at addressing leastdeveloped country concerns such as lowering agricultural subsidies inWestern countries, removing or lowering cotton subsidies and the

challenges they face in implementingWTO agreements

engaged. For the Monitoring Mechanismand the Cancún agreement, which are partof the Trade Facilitation agreement,positive advances have been made whichcould potentially translate into concreteprogress in the coming weeks. TheMonitoring Mechanism is part of anagreement to monitor how LDCs arecoping with implementing agreements inthe WTO.

During an earlier meeting in Paris onthe sidelines of the OECD, Lamy askedtrade ministers whether they were all readyto ensure that by the end of July "thecontours of landing zones for Bali wouldbe in sight". Ministers acknowledged thatnot making progress in Bali would havedamaging implications for the future ofthe Round and the credibility of themultilateral trading system.

This is why trade negotiators andambassadors fear the damage that failurein Bali could cause to the future of theRound and the credibility of themultilateral rule-based trading systemwhich has so far worked well in settlingtrade disputes and ensuring that the LDCsare not over-burdened to implement someagreements, given grace periods to affectthem, and granted duty-free and quota-free market access.

www.daily-m

ail.co.zm

Publications

SourcesBA: Biztech Africa; BC: Biz Community; BD: Business Daily; CD: China Daily; DN: Daily Nation; DM: Daily Monitor;ENO: Engineering News Online; IPS: Inter Press Service; IRIN: Integrated Regional Information Network;LV: Lusaka Voice; NE: New Era; TO: The Observer; TEA: The East African; TNT: The New Times; TP: The Post;VoA: Voice of America; WSJ: Wall Street Journal; ZAM: Zambia Association of Manufactures; ZDM: Zambia Daily Mail

SMEs Development in the Devolved Governance SystemPolicy Options for Institutional and Regulatory Reforms in Kenya

CUTS undertook a study to assess existing and potential institutional and regulatory challenges whichimpede SME development, at the county level. Evidence was gathered from SMEs engaged in the

following sectors: Irish potatoes, dairy, fishing, pineapples and oranges, to build the evidence base. Itemerged that current challenges include poor coordination of the SMEs activities; inadequate private andpublic dialogue at the county level; poor enforcement of regulatory legislations; and knowledge gapabout national and county-level policies' interface.

The study recommends the need to initiate inclusive private-public dialogues; support theestablishment of stronger business associations at the county level; formulate specific county led SMEspolicies aligned with the overall national SMEs policy framework; establish tailored training institutesfor SMEs at the county level; develop SMEs oriented financial institutions in counties; establish animport and export bank for SMEs; need for the central government to coordinate the SMEs issues inthe country and establish a SMEs development organisation.

www.cuts-international.org/ARC/Nairobi/pdf/SMEs_Development_in_the_Devolved_Governance_System_Policy_Options_for_Institutional_and_Regulatory_Reforms_in_Kenya.pdf

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CUTS New Centre@Accra (Ghana)

CUTS International is pleased to announce the inauguration of our Accra Centre on 26th August 2013, under thegraceful presence of Madam Hannah Tetteh, Honourable Minister of Foreign Affairs & Regional Integration, Ghana

and Honourable Haruna Iddrisu, Minister of Trade and Industry, Ghana. This will be our third office in Africa after Lusakaand Nairobi and fifth overseas office. This inauguration also coincides with our 30th Anniversary lecture in Accra, on the topic“Regional Integration as a Tool for Poverty Reduction in West Africa”. Through this new centre we continue our effortstowards accomplishing CUTS’ vision of “consumer sovereignty in the framework of social justice and economic equality,within and across borders.”

The staff at the centre can be contacted at accra@cuts.org,and the webpage will soon be operational at www.cuts-international.org/ARC/

Tradequity newsletter: Composed by CUTS International Lusaka, Plot 3653, Mapepe Road, Olympia, P.O. Box 37113, Lusaka,Zambia, Ph: +260.211.294892, Fax: +260.211.294892, E-mail: lusaka@cuts.org, CUTS Nairobi, Yaya Court 2nd Floor, No.5, Ring RoadKilimani off Argwings Kodhek Road, PO Box 8188, 00200, Nairobi, Kenya, Ph: +254.20.3862149, 3862150, 20.2329112, Fax: +254.20.3862149,Email: nairobi@cuts.org, and CUTS Accra, 30, Ground Floor, Oroko Avenue, Near Central View Hotel & ATTC, Kokomlemle, Accra, Ghana.Published by CUTS International, Head Office: D-217, Bhaskar Marg, Bani Park, Jaipur 302016, India, Ph: 91.141.2282821,Fax: 91.141.2282485, E-mail: cuts@cuts.org, Web Site: www.cuts-international.org

Thenews/storiesinthisNewsletterarecompressedfromseveralnewspapers.Thesourcesgivenaretobeusedasareferenceforfurtherinformationanddonotindicatetheliteraltranscriptofaparticularnews/story.