Leaders in Talks to Boost Trade
Trade barriers have stifled intra-trade in Africa. African leaders met in Addis Ababa under the auspices of the African Union to discuss ways of more than doubling intra-African trade, from the current 10 to 25 percent or more in the next 10 years. Compare this with North America where regional trade account for 40 percent and 63 percent in Western Europe.
Poor transportation infrastructure, tariff barriers, overreliance on export of primary commodities and production of similar products are some of the challenges facing trade in Africa.
Production Costs Still High in Tanzania
An increased production cost in Tanzania is adversely affecting the country’s competitiveness in the East African Community. Producing goods in the country remains a challenge due to the power costs affected on January 15, 2012. “The increased electricity tariffs will adversely affect Tanzania’s competitiveness,” according to Esther Mkwizu, Executive Director of Tanzania Private Sector Foundation.
Zambia Exports Maize to South Africa
Zambia’s maize surplus can partly shore-up the deficit in Southern Africa which has pushed up prices of the staple and accelerated inflation in food prices. South Africa is now importing maize from Zambia to make up for deficits.
Zambia also exports its maize surplus to Zimbabwe, Democratic republic of Congo, Kenya, Mozambique, Namibia, Botswana and Burundi. Zambia recorded a bumper harvest of three million tonnes of maize in the 2010-11 season, from 2.8 million tonnes the previous season. Zambia’s big yields have been attributed to government subsidies to peasant farmers in the form of fertilisers and seeds.
Kenya 2nd on Investors’ Survey
Nearly half of international fund managers and investment bankers see Kenya as a top frontier investment market second to Nigeria. A survey of 158 international investors by the Economist Intelligence Unit (EUI) showed that 76 percent of them believed that Kenya offered the best prospects for institutional investors over the next five years compared to 81 percent said Nigeria was better.
Local fund managers have attributed the growing interest to the emerging middle class that is offering a ready market for new products, including financial services, consumer good, power and energy..
Africa’s Fund to Set up Investment
South Africa’s Government Employees Pension Fund (GEFP) is considering investing around US$22bn outside the country to diversify its risks and some of that may go to African countries and emerging markets. Africa’s largest retirement fund, with a portfolio of about US$150bn, traditionally has had most of its investments in South Africa