Trade Africa initiative expands through new U.S.-EAC Cooperation Agreement
Trade ministers from the East African Community (EAC) bloc (Burundi, Kenya, Rwanda, Tanzania, and Uganda) met in Washington, D.C. this week to sign an agreement amplifying current joint efforts to reduce the barriers and costs associated with trade in the region. The U.S.-EAC Cooperation Agreement, launched on Thursday, February 26, formalizes additional measures between the U.S. and its East African partners to reform EAC customs processes in line with the Trade Facilitation Agreement of the World Trade Organization (WTO) and provide technical assistance to EAC countries so that they can meet global sanitary and phytosanitary standards for agricultural exports.
Trade among the EAC countries and the U.S. amounted to $2.8 billion in 2014: U.S. exports to the EAC reached $2 billion while U.S. imports from the region (which rose by 52 percent from 2013), totaled $743 million. The U.S. aims to further enhance the EAC’s export potential through the framework of the African Growth and Opportunity Act (AGOA) by crafting an EAC AGOA strategy aimed at boosting the region’s exports. At the deal signing ceremony on Thursday, U.S. Trade Representative Ambassador Michael Froman highlighted the EAC’s successes to date in reducing trade and transport costs and advancing regional integration, stating, “Today’s agreement [is] an important stepping stone for deepening what has already proven itself to be a promising and impactful partnership.”
For more on the role and potential of agricultural products in AGOA as well as recommendations for enhancements, see Josh Meltzer’s recent Africa in Focus piece, Reforming the African Growth and Opportunity Act to grow agriculture trade.
For more on the renewal of AGOA, see Witney Schneidman and Josh Meltzer’s recent Africa in Focus piece, Tightening AGOA conditionality: When less is more.
International Monetary Fund agrees to $933 million in loans for Ghana
This week the International Monetary Fund (IMF) and Ghana struck a deal to strengthen the country’s economy through a three-year loan program of $933 million. Pending the approval from the IMF’s board in April, Ghana will receive its first loan payment of $100 million shortly thereafter. The IMF assistance program will target the country’s growing fiscal and current account imbalances, which have been exacerbated over the last year due to the falling commodity prices of its main exports, cocoa, oil, and gold. Specifically, the program will focus on reigning in Ghana’s wage bill and increasing fiscal discipline while engaging in tax reforms and enhancing transparency in the budget process.
For more information on Ghana’s economic performance and the conditions that led to its request for IMF loans, please see Amadou Sy’s Africa in Focus piece, Ghana’s Request for IMF Assistance.
Lesotho seeks to reinforce stability in Saturday’s national assembly polls
On Saturday, February 28, Lesotho will select a new prime minister and national assembly, six months after an attempted coup that nearly unseated current Prime Minister Thomas Thabane. Since August 2014, when the military attempted to seize power and Thabane fled Lesotho for South Africa, the Southern African Development Community (SADC) negotiated an agreement that enabled Thabane to return to rule on the condition that parliament was allowed to reopen, which he had closed earlier that year. As part of the same deal elections were rescheduled from 2017 to this week. This election will see the incumbent Prime Minister Thabane from the All Basotho Congress (ABC) party vie against Pakalitha Mosisili of the main opposition Democratic Congress (DC), and Mothetjoa Metsing of the Lesotho Congress for Democracy (LCD), among other candidates.
While African Union and SADC officials report that they are confident that the conditions for fair and peaceful elections are present in Lesotho (and have sent 475 police officers to help maintain order), some political observers have voiced their concerns that tensions could flare over small missteps in the electoral process or that the military could step in following the election’s outcome. Approximately 1.2 million voters (of Lesotho’s estimated population of 2 million) are expected to turn out to vote on Saturday.