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tralac Newsletter • Issue 22 • August 2020
In this newsletter we focus on industrial development and policy for Africa. Since the COVID-19 pandemic struck and countries across the world responded by adopting trade restrictions, the lack of diversity and depth of productive capacity across the continent have become even more urgent policy concerns. Recommendations that all should strive to produce essential goods, such as personal protective and other medical equipment, and pharmaceutical products, have become part of the industrial policy advisories to African countries.

An important lesson from the pandemic concerns the trade-industrial policy interface. Discussions about reconfiguration of value chains away from truly global to regionally-concentrated production networks are important. Such developments involve industrial restructuring, possibly investment in new locations and implications for trade. The often-used phrase ‘no nation can prosper in isolation’ remains true, even for a post-COVID world. The pandemic provides an opportunity to consider what, how, for whom and where we produce goods and services. Efficiency and competitiveness imperatives are shifting, and nations have an opportunity to appraise their industrial and broader productive capacity development priorities to support economic transformation for ‘our new normal.’ This means also taking account of adjustments in consumer preferences, as many households are experiencing incomes losses, and also recalibrating their priorities under these new circumstances.

Among the important considerations for reimagining industrial development and policy for Africa in a post-COVID era are:



COVID-19 is a wake-up call. We are reminded that our planet, our economies and our societies are incredibly vulnerable to climate disasters, pandemics and many other crises. We are also reminded that this pandemic will be followed by other crises – and some will definitely be climate-related. Sustainable production and resource use have to become the ‘norm’. Production arrangements must also be anchored on work arrangements that support sustainable livelihoods for workers.

It is notable that the fastest growing standard, globally is ISO 50001. This standard is designed to assist in improving the performance of a company’s energy-intensive assets, contributing to costs savings and emission reduction. While adoption of ISO 50001 is particularly prevalent in Asia, Europe and North America, some African countries, including Morocco, Tunisia and Egypt, are among the leading adopters. Supporting companies to adopt and implement standards such as this should be a standard feature of a green industrial policy. This requires that we strengthen our standards bodies – they are essential institutions for effective industrial policy implementation.

Trade facilitation matters for industrial development

Most economic activities in the industrial sector, agriculture and services are trade-dependent in some way; sourcing inputs, services or exporting products or services. A broad view of trade-facilitation support requires focusing on improvements in the customs and border management value chain, reducing transport and other trade transaction costs, and ensuring that infrastructure services regulation supports access to costs effective and reliable transport, communication and other services. Good governance is a prerequisite for effective trade facilitation and should also include access to administrative law remedies so that officials are accountable for the powers and discretion that they exercise in the discharge of their trade facilitation duties.

Agriculture is an industry – food security concerns must inform industrial policy

Agriculture is an industry as is automotive or garment manufacture. Just as much as agriculture requires specific policy and other support, industrial policy interventions impact the agriculture sector – production and processing – just as they do ‘core manufacturing sectors’. So-called ‘horizontal’ industrial policy interventions that have economy-wide impact play a very important role in improving efficiency and competitiveness of the agriculture sector. Supporting agriculture – across the entire spectrum from micro, small, medium to large scale enterprises – has to feature in our industrial development discourse too. Only if we address the myriad constraints that hamper development of our agricultural sectors, improving quality assurance and related standards as well as the specific trade facilitation problems that agricultural trade faces, will we be able to address the food insecurity challenges of the continent.

The role of foreign direct investment in industrial development

Improving and diversifying our continent’s productive capacity for goods and services requires investment. Investment in infrastructure, including digital infrastructure; in new productive capacity; and in expanding, renewing and upgrading existing capacity are all required. While there is increasing evidence of cross-border investment across the continent, even at small scale, we need investment from global sources. COVID-19 is, according to UNCTAD, expected to reduce foreign direct investment significantly this year and perhaps for some years. But we are seeing interest from global investors, generated by the African Continental Free Trade Area (AfCFTA). Establishment of commercial presence in a State Party of the AfCFTA will mean that these enterprises will of course benefit from the enhanced market access and other benefits of the AfCFTA. This will contribute to the dynamic benefits of the AfCFTA.

Our Blogs this month cover a range of issues that are integral to the discourse and industrial policy agenda to expand and enhance Africa’s productive capacity.

We have come to understand the role of services across our economies, and specifically also in manufacturing competitiveness – recognising, for example, that it is not possible to be a competitive motor vehicle assembler or producer without competitive services inputs. The regulation intensity of services reminds us that regulation and good governance matter for Africa’s industrial development. In this Blog, Industrial development – the importance of services, regulation and good governance, we discuss these matters.

While recognising that industrial policy is a national competence, African countries have elevated the industrial development agenda to regional and continental levels too. Most regional economic communities have developed regional industrial strategies, and at African Union level, one of the flagship projects – Accelerated Industrial Development for Africa (AIDA) – has become the focal point for initiatives to support a range of sector development initiatives, including support to grow and enhance pharmaceutical production. A key focus of the discourse at regional and continental level is regional value chain development. Many enterprises import inputs from global sources – linking value chain development to transit trade as inputs make their way from point of entry to the enterprise where the inputs will be used. We’ve examined transit trade data during the pandemic, from point of entry in South Africa to track regional value chain linkages. We reflect also more broadly on the on impact of COVID-19 on Africa’s industrial development in these Blogs: COVID-19 – Lessons for Industrial development and policy for Africa and Regional industrial development – how can COVID-19 responses contribute?

Special economic zones feature increasingly in the industrial development suite of interventions for African countries. Experience across the continent and elsewhere provides important lessons. Rwanda’s SEZ experience provides insights into the potential for attracting FDI and diversifying productive capacity – including the establishment of a smart phone manufacturing plant.

Enhanced market access through trade agreements – such as the AfCFTA – provide opportunities to achieve economies of scale and scope. These opportunities provide a sound rationale for investment to expand and diversity production, bringing dynamic benefits from these agreements. Trade arrangements such as the African Growth and Opportunity Act can have a similar effect – Lesotho’s clothing and textile industry is a good example. This is a strong reminder that the relationship between trade and industrial policy is a very close one.
We look forward to your feedback.
Be safe and stay well
The tralac team

We’re pleased to share with you some of our recent work and coming events.
  1. Short course: Reading and Interpreting International Trade Agreements – case study of the AfCFTA

    Due to the demand for this short course, we are presenting the course three times this year (August/September; September, and November). All three are fully subscribed. We will offer the course again in 2021.

  2. Internship programme (August – November)

    Seven interns joined out virtual internship programme at the beginning of August. In addition to their structured work programme, they will all also take the above short course. We are very pleased to introduce our interns to you.

  3. tralac Annual Conference 21-22 September

    Our flagship event will be a virtual one, taking place 21-22 September, in a series of webinars. Please see the draft programme. If you would like to attend the Conference, please contact, by close of business 14 September. Registration is required for participation.

  4. tralac Alumni Workshop 21-29 September

    tralac’s Alumni from across the continent contribute in various capacities to Africa’s trade governance – working at national, regional and continental levels. At this annual Workshop they share their insights and experiences.

    Enquiries about the Alumni Workshop:

  5. AfCFTA Stakeholder Webinars (October) 

    Webinar 1: Overview of the AfCFTA, update on the negotiations and the institutions of the AfCFTA
    15 October (10:00 – 11:30 followed by open discussion 15:00 – 16:30 GMT+2)

    Webinar 2: The AfCFTA and the Regional Economic Communities
    22 October (10:00 – 11:30, followed by open discussion 15:00 – 16:30 GMT+2) 

    Webinar 3: Preparing for trade under the AfCFTA regime – implementation matters
    29 October (10:00 – 11:30 followed by open discussion 15:00 – 16:30 GMT+2)

    If you would like to participate, please do contact us (


Recent posts

Industrial development – the importance of services, regulation and good governance. Services, appropriate regulation and good governance are critical in industrial, and broader economic development. Services play a very significant role in Africa’s economic development; contributing, more to economic activity, than manufacturing and agriculture. Talkmore Chidede and Trudi Hartzenberg write more.

South Africa’s July 2020 trade data – exports recover while imports remain below 2019 levels. Between June and July of this year, South Africa’s total trade (exports + imports) increased by 12 percent. Since May, South Africa has a trade surplus (global exports exceed imports). Willemien Viljoen writes more.

The Secretariat is pivotal to the success of the AfCFTA. Broadly speaking the Secretariat stands to play a significant role in supporting transparency, access to information about implementation matters and accountability of the AfCFTA’s State Parties. The Secretariat is key to promoting these foundational elements of rules-based trade governance. Trudi Hartzenberg provides a discussion.

Daily news service

tralac curates a selection of the latest news and analysis relating to trade and integration in Africa and globally to enhance trade policy knowledge and information sharing. Sign up to receive daily news updates directly in your inbox. Click here to subscribe.

New publications

An updated guide to the African Continental Free Trade Area

This booklet offers a guide to the African Continental Free Trade Area (AfCFTA) and how it fits within Africa’s broader development agenda – the architecture of the AfCFTA Agreement and what it covers; institutional arrangements, committees and other AfCFTA initiatives; as well as intra-African and intra-REC trade and tariffs at a glance.



Governance under the AfCFTA: Linkages between Implementation and Gains

The AfCFTA is a member-driven arrangement. When all outstanding negotiations are completed, implementation will be the responsibility of individual State Parties.

How will AfCFTA State Parties manage Trade Relationships with Third Parties?

The AfCFTA legal texts indicate that existing trade arrangements will remain in place. Furthermore, State Parties will have the freedom to conclude new agreements within the context of such arrangements.

Trade amidst declining Trust: The Consequences for Multilateral Governance

Multilateral trade governance is facing many challenges. While multilateralism continues to offer invaluable international frameworks, there is need for reform, adjustment and expansion.

Access to justice and curial authority in COMESA, the EAC and ECOWAS

This paper looks at recent jurisprudence of three regional courts to see if the scholarly consensus remains – that these courts see few cases involving tariffs, trade barriers or other integration law issues.


Trade-related policy responses to COVID-19

tralac is monitoring trade-related policy measures and responses to the COVID-19 pandemic, adopted and implemented by African countries and beyond. Take a look at our resources pages to find out more:

Key regional resources


Latest AGOA news

Key trade stats for AGOA beneficiaries to end June 2020

Aggregate exports to US: 2020 YTD to June:
  $ 8.84 billion
(Share) of AGOA exports: 2020 YTD to June:
  $ 1.79 billion (represents 20% of total exports)
Total US import tariffs on aggregate imports from AGOA beneficiaries: 2020 YTD to June   $ 21.7 million (0.25% of value of total US imports from AGOA beneficiaries)

Aggregate exports from AGOA beneficiaries to the United States are down 12.1% year-to-date to the end of June 2020, compared the comparable previous period. Previously stipulated factors, particularly the much lower value of oil exports to the US from Nigeria as well as from Angola (lower demand combined with much lower oil prices) remain relevant, as well as contracted demand resulting from the economic impacts of the Covid-19 pandemic. Exports from some AGOA beneficiaries remain stable or have grown year on year, including from Kenya, Ethiopia, Madagascar Côte d’Ivoire and Tanzania. Mali recently completed the AGOA apparel visa requirements and since 4 August 2020 has been eligible to export under AGOA’s wearing apparel provisions, supported by favourable rules of origin provisions.

Kenya – US Free Trade Agreement

On 6 February 2020, US President Trump announced that the United States intends to initiate trade agreement negotiations with the Republic of Kenya following a meeting at the White House with Kenyan President Uhuru Kenyatta. The announcement came while the US-Kenya Trade and Investment Working Group held its third meeting in Washington (see inaugural meeting, second meeting) – having been established earlier by President Trump and President Kenyatta in 2018 in order to lay the groundwork for a stronger bilateral trade relationship. On 18 March 2020, the Trump Administration, through the USTR, formally notified the US Congress in line with the Bipartisan Congressional Trade Priorities and Accountability Act (Trade Promotion Authority) which, inter alia, subjects “trade agreements to congressional oversight and approval, consultations…”. In May and June respectively, the United States and Kenya published their negotiating principles. The negotiations began on 7 July 2020.

AGOA Business Connector


The AGOA Business Connector is an online facility on to help enable trade and business connections between producers, exporters, importers, sourcing agents, trade-related service suppliers including trade finance, logistics and related services, support organisations (such as business chambers and exporter associations and others), both from within sub-Saharan African AGOA beneficiary countries and the United States. Registered users are also able to list their businesses or professional trade-related service on the platform, and to communicate with other listings through a messaging facility.

> Download the AGOA Business Connector Brochure at this link

Download: AGOA guides and info-graphics

tralac has produced a number of info-graphic type brochures (see section on / Exporter Toolkit) covering a range of AGOA-related topics, including on AGOA’s legal provisions with regard to eligibility and annual/out of cycle reviews, rules of origin, AGOA FAQs, sector-focused brochures (textiles and clothing, agriculture), as well as national AGOA brochures relating to Botswana, Ethiopia, Ghana, Kenya, Lesotho, Madagascar, Mauritius, Namibia, Nigeria, South Africa and Tanzania.
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