1.South African court rules to protect country's investments in Zimbabwe
2.Banana wars ending
3.Zimbabwe diamonds banned by dealer over abuse concerns
4.Kenya-Uganda: Traders sell food mixed with soil and sand
5.Advice on doing business in Africa
December 13, 2009
South African court rules to protect country's investments in Zimbabwe
The South African High Court in Pretoria on November 26 ordered the South African government to honour a SADC tribunal finding that Zimbabwe's land reform programme was discriminatory, when it signs a bilateral agreement with its neighbour, Afriforum said. Lobby group Afriforum applied for the order when it heard the government intended signing a bilateral investment and protection agreement with Zimbabwe tomorrow.
"The [agreement] was generally understood to have the effect to exclude the enforcement of the SADC tribunal's orders, and to exempt Zimbabwe from liability for past human rights violations," Afriforum said in a statement. They believed it contravened South Africa's Constitution and international law and had been unable to discuss it with the trade and industry minister.
"As to the terms of the proposed [agreement], the South African government accepts in its court papers that the Zimbabwean land reform exercise is unlawful. "It also acknowledges the binding nature of the SADC tribunal's rulings, and international obligations pursuant thereto." Afriforum continued: "It stated emphatically that the [agreement] does not purport to grant immunity to Zimbabwe for any human rights violations."
The South African government undertook in the court settlement to respect and honour the tribunal's rulings, as well as other obligations under other sources of international law and the Constitutional to protect victims of the unlawful Zimbabwean land reform exercise. Afriforum welcomed the undertaking. The trade and industry department was not immediately available to comment.
The tribunal referred to took place in November 2008. It said Zimbabwe's land reform programme "constituted racial discrimination, an infringement of the right of access to courts, and an arbitrary taking without adequate compensation, each in breach of Zimbabwe's treaty obligations."
Business Day
"The [agreement] was generally understood to have the effect to exclude the enforcement of the SADC tribunal's orders, and to exempt Zimbabwe from liability for past human rights violations," Afriforum said in a statement. They believed it contravened South Africa's Constitution and international law and had been unable to discuss it with the trade and industry minister.
"As to the terms of the proposed [agreement], the South African government accepts in its court papers that the Zimbabwean land reform exercise is unlawful. "It also acknowledges the binding nature of the SADC tribunal's rulings, and international obligations pursuant thereto." Afriforum continued: "It stated emphatically that the [agreement] does not purport to grant immunity to Zimbabwe for any human rights violations."
The South African government undertook in the court settlement to respect and honour the tribunal's rulings, as well as other obligations under other sources of international law and the Constitutional to protect victims of the unlawful Zimbabwean land reform exercise. Afriforum welcomed the undertaking. The trade and industry department was not immediately available to comment.
The tribunal referred to took place in November 2008. It said Zimbabwe's land reform programme "constituted racial discrimination, an infringement of the right of access to courts, and an arbitrary taking without adequate compensation, each in breach of Zimbabwe's treaty obligations."
Business Day
Banana wars ending
by John Stepek
After 16 bitter years, the banana wars between Europe and America are ending. But what on earth were they and why does it matter? The banana wars could be about to end. "Thank the Lord," I hear you say. Get the bunting out for the street parties! This dreadful war is finally at an end!
Well, maybe not. In fact, you're probably thinking: "Banana wars? What?"
But you'd be amazed at the trouble the humble banana has caused in its time. On this occasion, we're talking about a trade spat that goes back to 1993. That makes it the world's longest-running trade dispute. The roots and causes of the banana wars go far deeper than this, but people have written whole books on this topic, so I'll not get into that right now.
Here's what the current dispute comes down to. The European Union gives favourable terms to banana growers in its former colonies in Africa, the Caribbean and Pacific region (ACP). Basically, it charges import tariffs (taxes) on bananas imported from everywhere else, to protect prices for the ACP region. The idea was to help Europe's ex-colonies using favourable trade terms so they wouldn't need direct overseas aid.
The US complained to the World Trade Organisation (WTO). The US doesn't export bananas to Europe, but Latin America does and the banana crop there is controlled by US multinationals. The US reckoned this subsidy was unfair on the Latin American producers, and the WTO - which polices world trade - agreed. It told the EU to stop it in 1997.
The EU changed its rules. The US didn't think it had gone far enough. The WTO has been forced to rule against the EU on this topic six times since the dispute kicked off. Now it looks as if - although it's not certain - the EU and Latin America have come to an agreement. Tariffs will be lowered over the course of seven years, to the point where Europe's former colonies are no longer given favourable terms.
So there'll be more competition in the banana market and consumers will end up getting cheaper bananas - good news, right? In theory, yes. Anyone who reads my columns even occasionally will know that I believe in capitalism, free markets and all the rest. That's not because I'm a viciously competitive borderline psychopath who thinks the weak should be crushed under the jackboot of the strong, which is the vague impression that I think some people get of capitalism. It's because I think it's the best way we know to help everyone in the world improve their standard of living. It's like democracy - it's got plenty of faults, but it's better than all the other systems we've tried so far.
Why's free trade a good thing? The basic idea behind free trade is this: you want to eat oranges and apples, I want to eat oranges and apples. We could each grow our own supply. But my garden is great for growing apples and rubbish for growing oranges. Yours is great for oranges, but a nightmare for apples. So rather than me wasting valuable time and money struggling to grow oranges, I just devote my whole garden to apples. You do the same with oranges. Then we trade our surplus with each other.That way we both benefit from a higher standard of living: we've saved ourselves time and energy by focusing on what we're good at and we still have all the apples and oranges we need.
Broaden the theory out to countries, and that's pretty much the idea behind free trade. And it does work. It's one of the main reasons why China and emerging markets have managed to get a lot richer in recent years. It's not a panacea, and it does have losers - just ask your average blue-collar American worker - but as whole, the global standard of living improves.
So this "victory" in the banana wars is a good thing, right? Well, not necessarily. For capitalism to work most effectively, the rules should apply to everyone. Unfortunately, they don't. Trade across the world is rife with protectionism and special interests and it's particularly bad in the agriculture sector. I'm not saying this represents a failure of free trade or capitalism. You can free markets up bit by bit, increase the size of your trading blocs and gradually spread the benefits across larger areas. But this deal doesn't strike me as being the right place to start.
The EU imports about four million tonnes of bananas a year. Of that, 3.4 million already comes from Latin America. So the big companies already control a vast chunk of the banana trade. Meanwhile, a vast chunk of the Caribbean islands' economies relies on banana farming, for example. Tough, you might think, that's competition for you. They should be growing something else. Well, that'd be fine, but it's not that simple.
Because although we might be looking at scrapping tariffs on bananas, the big protectionist measures still around - the European Common Agricultural Policy being a prime example, although US biofuel subsidies are another one - are still in place and heavily defended by their beneficiaries. So whatever this is, it's not a level playing field.
Now to be fair, seven years is a fairly long time to get to adapt to these changes, and they've been on the cards for a long time. The ACP countries will also get about €190 million in aid to sweeten the deal.
However, the ACP countries may have another ace up their sleeve - Fairtrade, which sources many of its bananas from the Windward Islands in the Caribbean. Now, I think that Fairtrade is a sticking plaster rather than a solution. Ultimately, it's just another subsidy, paid for by the consumer, and it's a bad idea for these countries' economies to be so reliant on one crop - particularly given that it is vulnerable to destruction by disease and weather. They should diversify in any way they can.
However, if you want to exercise your freedom of choice as a consumer to buy a banana which includes an element of charitable giving and, dare I say it, ethical shopping, then I'm certainly not going to discourage you from doing so. And while European farmers are still being given huge subsidies under the Common Agricultural Policy, effectively robbing developing world farmers of their livelihoods, I can't really describe the end of the banana wars, with the potential impact on poor farmers in developing markets, as a real victory for free trade.
MSN Money
After 16 bitter years, the banana wars between Europe and America are ending. But what on earth were they and why does it matter? The banana wars could be about to end. "Thank the Lord," I hear you say. Get the bunting out for the street parties! This dreadful war is finally at an end!
Well, maybe not. In fact, you're probably thinking: "Banana wars? What?"
But you'd be amazed at the trouble the humble banana has caused in its time. On this occasion, we're talking about a trade spat that goes back to 1993. That makes it the world's longest-running trade dispute. The roots and causes of the banana wars go far deeper than this, but people have written whole books on this topic, so I'll not get into that right now.
Here's what the current dispute comes down to. The European Union gives favourable terms to banana growers in its former colonies in Africa, the Caribbean and Pacific region (ACP). Basically, it charges import tariffs (taxes) on bananas imported from everywhere else, to protect prices for the ACP region. The idea was to help Europe's ex-colonies using favourable trade terms so they wouldn't need direct overseas aid.
The US complained to the World Trade Organisation (WTO). The US doesn't export bananas to Europe, but Latin America does and the banana crop there is controlled by US multinationals. The US reckoned this subsidy was unfair on the Latin American producers, and the WTO - which polices world trade - agreed. It told the EU to stop it in 1997.
The EU changed its rules. The US didn't think it had gone far enough. The WTO has been forced to rule against the EU on this topic six times since the dispute kicked off. Now it looks as if - although it's not certain - the EU and Latin America have come to an agreement. Tariffs will be lowered over the course of seven years, to the point where Europe's former colonies are no longer given favourable terms.
So there'll be more competition in the banana market and consumers will end up getting cheaper bananas - good news, right? In theory, yes. Anyone who reads my columns even occasionally will know that I believe in capitalism, free markets and all the rest. That's not because I'm a viciously competitive borderline psychopath who thinks the weak should be crushed under the jackboot of the strong, which is the vague impression that I think some people get of capitalism. It's because I think it's the best way we know to help everyone in the world improve their standard of living. It's like democracy - it's got plenty of faults, but it's better than all the other systems we've tried so far.
Why's free trade a good thing? The basic idea behind free trade is this: you want to eat oranges and apples, I want to eat oranges and apples. We could each grow our own supply. But my garden is great for growing apples and rubbish for growing oranges. Yours is great for oranges, but a nightmare for apples. So rather than me wasting valuable time and money struggling to grow oranges, I just devote my whole garden to apples. You do the same with oranges. Then we trade our surplus with each other.That way we both benefit from a higher standard of living: we've saved ourselves time and energy by focusing on what we're good at and we still have all the apples and oranges we need.
Broaden the theory out to countries, and that's pretty much the idea behind free trade. And it does work. It's one of the main reasons why China and emerging markets have managed to get a lot richer in recent years. It's not a panacea, and it does have losers - just ask your average blue-collar American worker - but as whole, the global standard of living improves.
So this "victory" in the banana wars is a good thing, right? Well, not necessarily. For capitalism to work most effectively, the rules should apply to everyone. Unfortunately, they don't. Trade across the world is rife with protectionism and special interests and it's particularly bad in the agriculture sector. I'm not saying this represents a failure of free trade or capitalism. You can free markets up bit by bit, increase the size of your trading blocs and gradually spread the benefits across larger areas. But this deal doesn't strike me as being the right place to start.
The EU imports about four million tonnes of bananas a year. Of that, 3.4 million already comes from Latin America. So the big companies already control a vast chunk of the banana trade. Meanwhile, a vast chunk of the Caribbean islands' economies relies on banana farming, for example. Tough, you might think, that's competition for you. They should be growing something else. Well, that'd be fine, but it's not that simple.
Because although we might be looking at scrapping tariffs on bananas, the big protectionist measures still around - the European Common Agricultural Policy being a prime example, although US biofuel subsidies are another one - are still in place and heavily defended by their beneficiaries. So whatever this is, it's not a level playing field.
Now to be fair, seven years is a fairly long time to get to adapt to these changes, and they've been on the cards for a long time. The ACP countries will also get about €190 million in aid to sweeten the deal.
However, the ACP countries may have another ace up their sleeve - Fairtrade, which sources many of its bananas from the Windward Islands in the Caribbean. Now, I think that Fairtrade is a sticking plaster rather than a solution. Ultimately, it's just another subsidy, paid for by the consumer, and it's a bad idea for these countries' economies to be so reliant on one crop - particularly given that it is vulnerable to destruction by disease and weather. They should diversify in any way they can.
However, if you want to exercise your freedom of choice as a consumer to buy a banana which includes an element of charitable giving and, dare I say it, ethical shopping, then I'm certainly not going to discourage you from doing so. And while European farmers are still being given huge subsidies under the Common Agricultural Policy, effectively robbing developing world farmers of their livelihoods, I can't really describe the end of the banana wars, with the potential impact on poor farmers in developing markets, as a real victory for free trade.
MSN Money
Zimbabwe diamonds banned by dealer over abuse concerns
A major diamond firm has issued a trade ban on all diamonds from Zimbabwe's Marange fields because of "severe and continued human rights violations." The Rapaport Group and its Rapnet diamond trading network also called on other major diamond manufacturing and trading bodies to do the same.
Rights activists say troops killed 200 people at the Marange field last year. Zimbabwe's government has denied abuse claims and vowed last week to pull its soldiers out of the diamond field. Earlier this month the body that regulates the sale of so-called blood diamonds, the Kimberley Process, rejected attempts by rights groups to suspend Zimbabwe.
The organisation instead gave Harare until June 2010 to reform its mining practices. But Rapaport group chairman Martin Rapaport said: "The Kimberley Process is being used as a fig leaf to cover up human rights abuses in the diamond sector."
The group says the ban affects diamonds from Marange only, not from anywhere else in Zimbabwe.
Rapnet claims to be the world's largest diamond trading network, with daily online listings of gems worth more than $4bn. The world's biggest diamond producer, De Beers, said it had already told its buyers not to deal in diamonds from Marange.
BBC
Kenya-Uganda: Traders sell food mixed with soil and sand
by Geof Magga
Kenyans living in the Uganda-Kenya border towns of Malaba and Busia have appealled to the Uganda government to arrest and deal with traders who have been mixing the food they sell to them with soil and sand. Kenyan traders who have unknowingly bought the contaminated food from Ugandan traders and resold them to their fellow citizens have been attacked by angry customers.
According to the chairman of Kenyan food dealers at the Malaba border town in Kenya, George Oundo, some Ugandans dealing in food have in recent times been selling Kenyans adulterated food, which puts the consumers’ lives at a risk.
Oundo said, "The practice of mixing soil in millet flour and sand in maize flour by Ugandan traders is causing us a lot of problems. The consumers in Kenya think we are the ones doing the mixing because they buy directly from us.’’
He said that some of his colleagues have been beaten up by people who buy the millet and maize flour only to discover that the food product is mixed with soil and sand. He said they have reported to the Ugandan police about it.
The chairman of Ugandan traders in Busia border town, Martin Wavamuno said, "It is unfortunate that some unscruplous Ugandan traders are adding soil in millet flour and sand in maize flour which they sell to Kenyans. We are fighting the vice. We have instructed the police to check all the food brought to Busia and Malaba border points meant for selling to Kenyans.’’ He warned Ugandan traders against the habit.
The officer in charge of Malaba police, Charles Otieno, said that so far four Ugandan traders who have been selling food mixed with soil and sand have been arrested.
Kenyans living close to the Uganda-Kenya border towns of Busia and Malaba depend mostly on food from Uganda. Uganda also exports food to southern Sudan.
Advice on doing business in Africa
by Karen E. Klein
Later this month, hundreds of U.S.-based small-business owners will meet potential partners and suppliers from Africa's 53 countries at an international summit held in Washington, D.C. The 7th Biennial U.S.-Africa Business Summit will include a business matchmaking program aimed specifically at small and mid-sized companies on both continents, says Stephen Hayes, president and CEO of the trade group The Corporate Council on Africa, which is organizing the event. With democracy and vibrant free enterprise becoming common in many African nations, Hayes says, the continent is a promising that U.S. companies ignore at their peril. He spoke to Smart Answers columnist Karen E. Klein. Edited excerpts of their conversation follow.
For most small business owners, the cultural and distance barriers involved in doing business with Africa seem insurmountable. Why is it worth their while to investigate the possibilities?
There's a great deal of negative publicity surrounding Africa, and that tends to be all that people hear. But in reality there are 53 countries on the continent and in many of them, there are an enormous amount of positive things happening. There are extraordinarily promising possibilities in agribusiness, infrastructure, and tourism.
A lot of that negative publicity that you mentioned involves war, natural disaster, and governments steeped in corruption. Those don't seem like ideal business conditions.
Well, the charge of corruption is valid in some countries. But you have to remember that there are disasters and corruption all over the world, including in South America and North America. That doesn't preclude us doing business there.
Which African countries offer the most promise for business exchanges?
The best possibilities are in the southern half of the continent, countries like Mozambique, South Africa, Mauritius, and Namibia. Ghana has enormous potential in its ports, fisheries, and tourism, as does Botswana.
What about younger democracies, such as Liberia and Nigeria?
Liberia's new woman president [Ellen Johnson Sirleaf] organized her campaign partly out of our offices. The country is very open to American business, but it's quite tough to start from ground zero. Everything in that country has been destroyed and financing would be a challenge there. Nigeria is also a booming market where a lot of new things are happening, but it's a tough place to do business and you really have to know your partners.
Another area doing surprisingly well, by the way, are the Sub-Saharan countries of Burkina Faso and Mali. They get high marks for business development, but they are French-speaking so often the trade there gravitates to France.
What's on the agenda at your summit specifically for smaller companies?
The Africa Trade Officehas gotten a $400,000 developmental grant from the U.S. Small Business Adminstration to run a matchmaking program for small- and mid-sized businesses. They will be given the opportunity to easily identify prospective business partners and sign up electronically for brief introductory meetings before and during the summit.
The summit also offers 50 industry-specific workshops based on the knowledge of how to do things in African business, new ideas in the field, and so forth.
When is the summit—and can small businesses still attend?
Yes, they can still attend—they can register at the door if they want to. The summit will be held at the Walter E. Washington Convention Center in Washington from Sept. 29 to Oct. 1.
We had 2,400 attendees last time, and we're hoping for at least 1,500 this year.
Several African heads of state are coming and many government ministers. We're hopeful that our President and Secretary of State will be there too.
How long has the summit been held, and who sponsors it?
We've held it every two years since 1997. The Corporate Council sponsors it. We are a nonprofit trade organization whose mission is to increase trade with Africa. We do very little lobbying. A group of business people founded the organization in 1993, and it was made possible through a government grant under Ron Brown. [Brown was the first African-American U.S. Secretary of Commerce; he served under President Bill Clinton. He died in a plane crash in 1996.]
What results have you had since the group was founded?
We have 185 member companies that together represent 85% of all U.S. private investment in Africa. About one-third are Fortune 500 companies, one-third are mid-sized, and one-third are small companies that have gross revenues of $6 million or less.
Our small business community is quite varied. Some of them actually have operations in Africa, others are looking to subcontract for larger companies working in Africa, and some are involved in trade with Africans. One of our members, Computer Frontiers in Maryland, is a small firm that rebuilds and sells secondhand computers to Africa. Another is a firm that puts bridges together very rapidly and sells them to African countries. We have helped many companies import goods from Africa, things like handicrafts and wines. If you go to a store shelf and see a product from Africa, it's likely that we've brokered that deal.
How much does it cost a small business to join your group, and what benefits do they get?
It's $5,000 for a small business to join, which is a bargain because if you got over [to Africa] on your own, particularly as a small business owner, you'd have a lot of trouble figuring out what's going on, and you could easily spend tens of thousands just trying to learn about the opportunities. In our group, you quickly get a professional sense of what the issues are and you can identify qualified partners.
BusinessWeek
Later this month, hundreds of U.S.-based small-business owners will meet potential partners and suppliers from Africa's 53 countries at an international summit held in Washington, D.C. The 7th Biennial U.S.-Africa Business Summit will include a business matchmaking program aimed specifically at small and mid-sized companies on both continents, says Stephen Hayes, president and CEO of the trade group The Corporate Council on Africa, which is organizing the event. With democracy and vibrant free enterprise becoming common in many African nations, Hayes says, the continent is a promising that U.S. companies ignore at their peril. He spoke to Smart Answers columnist Karen E. Klein. Edited excerpts of their conversation follow.
For most small business owners, the cultural and distance barriers involved in doing business with Africa seem insurmountable. Why is it worth their while to investigate the possibilities?
There's a great deal of negative publicity surrounding Africa, and that tends to be all that people hear. But in reality there are 53 countries on the continent and in many of them, there are an enormous amount of positive things happening. There are extraordinarily promising possibilities in agribusiness, infrastructure, and tourism.
A lot of that negative publicity that you mentioned involves war, natural disaster, and governments steeped in corruption. Those don't seem like ideal business conditions.
Well, the charge of corruption is valid in some countries. But you have to remember that there are disasters and corruption all over the world, including in South America and North America. That doesn't preclude us doing business there.
Which African countries offer the most promise for business exchanges?
The best possibilities are in the southern half of the continent, countries like Mozambique, South Africa, Mauritius, and Namibia. Ghana has enormous potential in its ports, fisheries, and tourism, as does Botswana.
What about younger democracies, such as Liberia and Nigeria?
Liberia's new woman president [Ellen Johnson Sirleaf] organized her campaign partly out of our offices. The country is very open to American business, but it's quite tough to start from ground zero. Everything in that country has been destroyed and financing would be a challenge there. Nigeria is also a booming market where a lot of new things are happening, but it's a tough place to do business and you really have to know your partners.
Another area doing surprisingly well, by the way, are the Sub-Saharan countries of Burkina Faso and Mali. They get high marks for business development, but they are French-speaking so often the trade there gravitates to France.
What's on the agenda at your summit specifically for smaller companies?
The Africa Trade Officehas gotten a $400,000 developmental grant from the U.S. Small Business Adminstration to run a matchmaking program for small- and mid-sized businesses. They will be given the opportunity to easily identify prospective business partners and sign up electronically for brief introductory meetings before and during the summit.
The summit also offers 50 industry-specific workshops based on the knowledge of how to do things in African business, new ideas in the field, and so forth.
When is the summit—and can small businesses still attend?
Yes, they can still attend—they can register at the door if they want to. The summit will be held at the Walter E. Washington Convention Center in Washington from Sept. 29 to Oct. 1.
We had 2,400 attendees last time, and we're hoping for at least 1,500 this year.
Several African heads of state are coming and many government ministers. We're hopeful that our President and Secretary of State will be there too.
How long has the summit been held, and who sponsors it?
We've held it every two years since 1997. The Corporate Council sponsors it. We are a nonprofit trade organization whose mission is to increase trade with Africa. We do very little lobbying. A group of business people founded the organization in 1993, and it was made possible through a government grant under Ron Brown. [Brown was the first African-American U.S. Secretary of Commerce; he served under President Bill Clinton. He died in a plane crash in 1996.]
What results have you had since the group was founded?
We have 185 member companies that together represent 85% of all U.S. private investment in Africa. About one-third are Fortune 500 companies, one-third are mid-sized, and one-third are small companies that have gross revenues of $6 million or less.
Our small business community is quite varied. Some of them actually have operations in Africa, others are looking to subcontract for larger companies working in Africa, and some are involved in trade with Africans. One of our members, Computer Frontiers in Maryland, is a small firm that rebuilds and sells secondhand computers to Africa. Another is a firm that puts bridges together very rapidly and sells them to African countries. We have helped many companies import goods from Africa, things like handicrafts and wines. If you go to a store shelf and see a product from Africa, it's likely that we've brokered that deal.
How much does it cost a small business to join your group, and what benefits do they get?
It's $5,000 for a small business to join, which is a bargain because if you got over [to Africa] on your own, particularly as a small business owner, you'd have a lot of trouble figuring out what's going on, and you could easily spend tens of thousands just trying to learn about the opportunities. In our group, you quickly get a professional sense of what the issues are and you can identify qualified partners.
BusinessWeek
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