Oil prices are forecast to rise to $56 a barrel in 2018 from $53 this year as a result of steadily growing demand, agreed production cuts among oil exporters and stabilizing U.S. shale oil production, while the surge in metals prices is expected to level off next year, the World Bank said on a press statement released October 26th 2017.
Prices for energy commodities – which include oil, natural gas, and coal -- are forecast to climb 4 percent in 2018 after a 28 percent leap this year, the World Bank said in its October Commodity Markets Outlook. The metals index is expected to stabilize in the coming year, after a 22 percent jump this year as a correction in iron ore prices is offset by increased prices in other base metals. Prices for agricultural commodities, including food commodities and raw materials, are anticipated to recede modestly in 2017 and edge up next year.
“Energy prices are recovering in response to steady demand and falling stocks, but much depends on whether oil producers seek to extend production cuts,” said John Baffes, Senior Economist and lead author of the Commodity Markets Outlook. “Developments in China will play an important role in the price trajectory for metals.”
The oil price forecast is a small downward revision from the April outlook and is subject to risks. Supplies from producers such as Libya, Nigeria, and Venezuela could be volatile. Members of the Organization of the Petroleum Exporting Countries (OPEC) and other producers could agree to cut production further, maintaining upward pressure on prices.
However, failure to renew the agreement could drive prices down, as could increased production from the U.S. shale oil industry. Natural gas prices are expected to rise 3 percent in 2018, while coal prices are seen retreating following a climb of nearly 30 percent in 2017. China’s environmental policies are anticipated to be a key factor determining future trends in coal markets.
Iron ore prices are forecast to tumble 10 percent in the coming year but tight supply should push up prices for base metals including lead, nickel and zinc. Downside risks to the forecast include slower-than-anticipated demand from China, or an easing of production restrictions on China’s heavy industries.
Gold prices are anticipated to ease next year on expectations of higher U.S. interest rates.
Agriculture prices are expected to edge up in 2018 due to reduced supplies, with grain and oils and meals prices rising marginally. Agricultural commodities markets are well-supplied and the stocks-to-use ratios (a measure of how well supplied markets are) of some grains are forecast to be at multi-year highs.
However, favorable weather patterns, well-supplied global food markets, and relatively low world prices do not necessarily imply ample food availability everywhere. Drought conditions that are by some accounts the worst in 60 years, have caused crops failures in parts of Ethiopia, Somalia and Kenya and led to severe food shortages. Conflicts in South Sudan, Yemen and Nigeria have driven millions of people from their homes and left millions more in need of emergency food.
The World Bank’s Commodity Markets Outlook provides detailed market analysis for major commodity groups, including energy, metals, agriculture, precious metals, and fertilizers. The report includes price forecasts to 2030 for more than 45 commodities. It also provides historical price data and supply, demand, and trade balances for most commodities.
Trade liberalization without enhanced production is a recipe for disaster, Economic Commission for Africa (ECA) Southern Africa regional director Said Adejumobi has observed.
Speaking at the official opening of the Ad-hoc Expert Group Meeting (AEGM) on “Deepening Regional Integration in Southern Africa: The Role, Prospects and Progress of the Tripartite Free Trade Area (TFTA), Mr Adejumobi said without production, trade and market liberalization is meaningless.
A developmental approach to regional integration was adopted by the TFTA anchored on three main pillars; market integration, industrial and infrastructure development.
Mr Adejumobi said the industrial pillar seeks to boost the productive capacity of member-states, promote value addition and benefication, and enhance economic diversification. The infrastructure component is aimed at easing the challenge of doing business, and allowing the free flow of goods and services.
“The TFTA (apart from the CFTA) represents the most ambitious attempt at integrating African economies in creating a free trade area for 26 African countries of 632 million people, representing 51 percent of Africa's GDP and constituted by three regional economic communities-COMESA, SADC and the EAC”, Mr. Adejumobi added.
Mr Adejumobi also noted that the TFTA provided the architecture of development that would be crucial in realizing the aspirations of Agenda 2063 and Agenda 2030.
“The TFTA, if well implemented, has the capacity to promote trade, enhance production, spur economic competition and thereby improve the quality of goods and services across the regions, encourage creativity and innovation, create more jobs, reduce poverty and ensure that nobody is left behind in the development train with better economic opportunities for all” he said.
He emphasized the need for the industrial pillar of the TFTA to promote the development of indigenous capitalist or entrepreneurial class that would increasing assume a multinational character.
He noted the need to prioritize the small and medium scale enterprises as they are usually the hubs for job and wealth creation in developing economies; and need for greater harmonization in the industrial policies of the three RECs. He further added that the SADC Industrialization Strategy and Roadmap of 2015, the COMESA Industrialization policy and EAC industrial policy agenda must all coalsce together to avoid discontinuities in the industrial focus of the three organizations and their member-states.
He also noted the need to extend the free movement for business persons in the TFTA to include all citizens of the TFTA of all the three regional blocks. He called for deconstructing of Africa's national borders which will not only make for good economics but also good social and political re-engineering of our Continent as contained in the Pan-African ideals.
Meanwhile, the Government of Zimbabwe is committed to regional integration and that its current economic blue print, the Zimbabwe Agenda for Sustainable Socio-Economic Transformation, recognizes the importance of industrialization and trade in transforming its economy.
Secretary, Ministry of Finance and Economic Development, Willard Manungo, said regionalism is an important trend in the modern world as it contributes to the opening of markets, enhancing the development of regional value chains, and increases intra trade, stimulating economic growth and lifting people out of poverty.
He expressed confidence that Prospects and Progress of the Tripartite Free Trade Area was moving in the right direction, though at a slow pace.
Mr Manungo further noted that regional integration in Southern Africa is built on three pillars of industrial development, infrastructure development and market integration.
However, Mr Manungo noted that the region has suffered from a critical deficiency in infrastructure, particularly, regarding access to electricity, transport, information and communication technology, water and sanitation and irrigation, among others.
“To bridge the funding gap for infrastructure, the Government of Zimbabwe established a Joint venture unit housed in my Ministry to facilitate public-private partnership initiatives and is currently putting a framework to implement Special Economic Zones in pilot areas such as Bulawayo, Sunway City in Harare and Victoria Falls”, he said.
Mr Manungo said that at regional level, the Government of Zimbabwe was involved in cross border infrastructure collaboration, notable projects include; rehabilitation of the Kariba Dam Wall Governments of Zimbabwe and Zambia, jointly mobilized resources; and the opening of the One Stop Border Post at Chirundu.
He commended ECA and the Inter-Governmental Committee of Experts (ICE) for championing the agenda for deepening regional integration through trade facilitation and infrastructure development. He hoped that the deliberations were going to proffer concrete, focused and workable recommendations on developing infrastructure that would facilitate smooth trade, thereby strengthening the regional integration agenda.
Participants at the AEGM includes experts in regional integration, senior government officials and representatives of regional economic communities, research institutions, civil society organizations and the private sector, who will deliberate on the theme and identify the opportunities from enhanced integration. (UNECA ATPC)
Melaku Ezezew (Eng.), elected as the president of the Ethiopian Chamber of Commerce and Sectoral Associations (ECCSA).
On October 27, 2017, (ECCSA) has elected Melaku Ezezew (Eng.) who came from the historical town of Gonder and has got the major vote to serve the chamber for the coming two years. Melaku won the election by securing 87 votes to become the successor of Mr.Solomon Afework who refused to compete for another term, while he has a right to serve the chamber for one more term.
Other candidates include Feysa Ararsa, the outgoing board member of ECCSA and founder of Harambe University College, Fasil Tadesse, President of Textile and Garment Manufacturing Association who managed to secure only 75 and 8 votes respectively from the total 174 voters that come from regional chamber and some other sectoral associations.
Facebook has revealed that the company has launched its Nigerian SME Council, the first of its kind to launch on the continent. The council forms part of Facebook’s ongoing commitment to help support small and medium-sized businesses throughout Africa.
The Nigerian SME Council brings together Facebook Africa’s SME team and Nigerian business owners from a range of industries, in a partnership designed to provide better digital tools for business and customer growth.
The council is made up of a combination of 15 start-ups and established SMEs from a range of industries. Each person from each respective business brings with them a wealth of unique experiences in understanding and embracing digital and mobile strategies, as well as reaching the Nigerian customer, making them ideally positioned to offer support to other companies who need it.
Speaking at the launch, Abi Williams, Facebook’s SMB Sales Manager, EMEA said: “Small businesses form the backbone of most of the thriving economies in the world, driving sustainable growth and creating jobs, and those in Nigeria are no different. Facebook is strategically positioned to help SME’s grow their businesses, and with a vibrant SME sector, Nigeria was a natural choice in launching our very first SME Council on the African continent. With 35 million people in other countries connected to a Nigerian business on Facebook, the global market has never been closer for Nigerian SMEs.” (ITNewsAfrica)
Dubai will this November host African heads of State and business leaders at a forum to discuss the continent’s economic outlook and investment opportunities for countries in the United Arab Emirates (UAE).
The conference, which will take place on November 1 and 2, 2017, will host five African heads of state and 12 ministers.
It will also host more than 1,000 top-level government and corporate decision-makers and industry experts. The event will be held at Dubai’s Madinat Jumeirah.
The event is being hosted by the Dubai Chamber of Commerce and Industry.
Hamad Buamim, President and CEO of the Dubai Chamber of Commerce and Industry said that with the Global Business Forum series, Dubai has managed to offer a global platform, allowing top officials, decision-makers and investors to explore the prospects of economic partnership and cooperation among international markets.
The Dubai emirate is now becoming a magnet for African business.
East Africa will be represented by Rwanda’s Paul Kagame and Uganda’s Yoweri Museveni. “The Global Business Forum on Africa, which is set for an unprecedented top-tier attendance, including distinguished African heads of state and ministers, is testament to Dubai’s firm position on the global economic map,” Mr Buamim said.
The Global Business Forum series was launched by the Dubai Chamber of Commerce and Industry in 2012, and focuses on Africa, the Commonwealth of Independent States and Latin America. (Standard Digital Kenya)
The African Development Bank (AfDB) has called for global support for Africa’s young farmers and “agripreneurs”, highlighting how agribusiness is the answer to the continent’s youth employment.
In collaboration with the Initiative for Global Development, the Association of African Agricultural Professionals in the Diaspora, Michigan State University, Iowa State University, and the International Institute of Tropical Agriculture, the AfDB brought together stakeholders to discuss how to expand economic opportunities for Africa’s youth throughout the agricultural value chain, from lab to farm to fork.
“Africa’s next billionaires are not going to come from oil, gas, or the extractives. ENABLE Youth is about investing in small agribusinesses today so that they can grow into large enterprises tomorrow,” Akinwumi Adesina (pictured above), the AfDB president said at the event.
“By empowering youth at each stage of the agribusiness value chain, we enable them to establish viable and profitable agribusinesses, jobs and better incomes for themselves and their communities.”
Adesina was presenting a paper during a session titled “Making Farming Cool: Investing in future African farmers and Agripreneurs” on the sideline of the 2017 World Food Prize Symposium-Borlaug Dialogue in Des Moines, Iowa in the US.
It was attended by young entrepreneurs from Africa private sector representatives, policymakers and thought leaders, among others. Africa has the world’s youngest population with 60 per cent being under 35 years old.
There are 420 million youth aged 15-35 and this segment of the population is expected to double to 840 million by 2040.
Working with the International Institute for Tropical Agriculture, the African Development Bank is empowering young farmers under the Empowering Novel Agri-Business-Led Employment (ENABLE) Youth programme.
He explained how attracting a new cadre of young, energetic and talented agripreneurs is an urgent priority.
Recent studies indicate that as African economies transform, there are expanding opportunities for youth employment and entrepreneurship throughout high-potential value chains – literally from lab to fork – where consumer demand is increasing, including horticulture, dairy, oil seeds, poultry and aquaculture.
In addition, there are huge opportunities for engaging African youth in services and logistical sectors in key off-farm activities such as transportation, packaging, ICT and other technology development and light infrastructure – that add value to on-farm productivity and efficiency, in ways that could not be envisioned before. The whole idea of connecting farms to markets, particularly rising urban and regional markets, is where Africa needs to plug in this bulging youth population, Adesina said. (Trade Mark East Africa)
The 6th EU-Africa Business Forum will be held on 27 November 2017 at Palais de la Culture, Abidjan, Cote d'Ivoire, host country of the 5thAfrican Union-European Union Summit of Heads of State and Government
The Forum will be the business window of the Summit and will convey practical views and proposals to the political leaders. It will bring together African and European economic operators representing multi-nationals, large corporations, small and medium-scale enterprises and confederations, start-ups, private and public financiers, and multilateral and regional institutions, to discuss practical opportunities to work together and to improve the business and investment climate.
One year after enacting the EU-South African Development Community (SADC) Economic Partnership Agreement (EPA), officials from the EU and South Africa gathered in Johannesburg to review its progress and consider next steps.
The EU-SADC EPA entered into force in October 2016, and is designed to be an asymmetrical, development-oriented agreement. The accord has been signed by six of the 15 SADC members, namely Botswana, Lesotho, Mozambique, Namibia, South Africa, and Swaziland.
The EPA grants all of those countries, with the exception of South Africa, duty-free, quota-free access to the European market, while improving market access for Johannesburg. The 28-nation EU ranks as the largest trading partner for these countries, with European Commission statistics placing imports at over €30 billion in minerals, metals, and other products in 2015. The block exported similar levels of engineering, automotive, and chemical products.
At this week’s meeting in Johannesburg, EU Trade Commissioner Cecilia Malmström told stakeholders that the 28-nation block was determined to “build on the provisions of the EU-SADC EPA that enable and even require us to be inclusive and seek systematically the involvement of civil society.”
The EU trade chief highlighted the value of bringing civil society and other stakeholders into the implementation process, including through “domestic advisory groups,” and noted that Brussels will be pushing to ink a deal with SADC EPA countries for setting up a “joint platform” bringing in additional points of view.
The EU trade official further reaffirmed the importance of the binding provisions in the trade and sustainable development chapter of the deal, referring to labour and environmental standards.
In a joint press release, South Africa Trade and Industry Minister Rob Davies said that “both parties should work together to ensure that the EPA contributes to the structural transformation agenda of the region, enhances trade, and promotes mutually beneficial outcomes.”
However, the South African trade chief also told South African news agency the Daily Maverick that more could be done to make better use of the deals’ terms.
“If our producers are not taking up their export quotas we need to see what it needs to meet the EU standards,” Davies said, referring specifically to agricultural exports.
Malmström, meanwhile, noted in a speech to Witwatersrand University students this week that South African agricultural exports to the EU have grown over the past year, while noting “There is much more to do to really reap the benefits.”