Monthly Archives: October 2014

Be still.

By Rafiq Raji

She is fidgeting again.

Why can’t she just be still?

And what does she do when she dashes out like that?

She is back. How are you little one?

Were you sick?

A scratch there. She loosens her hair. Again.

Styles it into a single knot this time. No? Not enough.

A look at the dress. There is a tiny wrinkle there.

Where? There. Here? No, there.

Here? No, further up. Here? No, up!

This is my head! Yes, the wrinkle is there.

Another dash out.

Another hair play.

Another scratch.

Another sitting position.

Up again!

Be still, Sweetheart. Be still.

Africa’s trade with the developed world: Reflecting on trade preference schemes (Part II)

By Rafiq Raji

ssa us exportsssa eu exports

Sub-Saharan Africa (SSA) exports to the United States (US) has been declining since 2011. At USD40bn in 2013, it was a 50% drop from three years earlier. It is set to decline further in 2014. This is because natural resources (especially crude oil) dominated SSA exports hitherto. As increasing shale gas production brings the US closer to becoming a net exporter of crude oil, this is set to change. Consequently, SSA crude oil producers have sought new customers in Asia. In July 2014, Nigeria did not ship a single barrel of crude oil to the US. This is the beginning of a trend that is likely to be pervasive amongst SSA crude oil producers. This new crude oil market dynamics make it more likely the declining trend in SSA-US exports would worsen in 2014-15. The resource-rich SSA countries of Angola, Nigeria and South Africa have consistently accounted for at least three-quarters of SSA exports to the US since 2005. The same resource-rich SSA countries account for a significant portion (64%) of the sub-continent’s exports to the European Union (EU). However, the structure is relatively more diversified.

In light of the aforementioned, it seems paradoxical that one would adjudge AGOA a relative success. That potential confusion is defused when you “clean up” (discount crude oil and other natural resources) SSA exports to the US. Otherwise, the trade structure is not dissimilar from that of the sub-continent with other regions. According to US International Trade Administration (ITA) data, non-fuel AGOA US imports was USD4.9bn (18% of total AGOA imports of USD26.8bn) in 2013. The positive trend in textile and apparel exports to the US is why AGOA is praised. In 2013 for instance, SSA textiles and apparel exports to the US increased by 11%. These are the types of exports that generate jobs and contribute to growth. It is trends like this that the performance of trade preference schemes should be judged by. So although US-SSA trade has been declining, the positive trend in light manufacturing exports (textiles and apparels) point to the effectiveness of AGOA. In contrast, that type progress is not discernible from EU-SSA trade. For instance, manufactures constituted just 3.7% of 2013 EU imports from West Africa. More progress is seen in Eastern & Southern Africa (ESA), with manufactures constituting 28% of 2013 EU imports. In SADC, it was 32%. So it varies.

Views are mine and not that of any institution(s) I may be affiliated with.

Tazarce*

By Rafiq Raji

spy

“Quiet lion approaching airport, confirm all clear over”

“All clear, alpha team. Quiet lion is safe to proceed”

Colonel Umar had a slight smile on his face as he listened to his CSO check in on advance teams stationed at various points en route the Aminu Kano International Airport. Umar thought to himself: “Quiet lion? Which one of them morons thought of that epithet?” Like his fellow brethren in the public service, he spent his weekends in his home city, Kano nadabo. He also liked performing the Jumat service at the Masalacin Sarki; you have to keep in touch with these two-ear bastards you see. That was one of the perks of serving a Christian president. Because the former president was a Muslim, they all had to wait till he attended the service at the National Mosque in Abuja before heading out of the capital city. And he would have had to wait till the president was safe in Sokoto before boarding one of the jets in the presidential fleet to Kano. The security protocol was still the same though. They stopped all traffic one hour before the presidential motorcade was due to pass and snipers stationed at various points en route had a standing order to shoot to kill any living being in sight who was not in a designated area. No point trying to find out why someone was fixing his flat tyre just around the time the president was due to pass. Simply take them out. No one in sight until the president’s motorcade and at least three decoys had passed at other routes, those were the orders!

As chief of the Secret Service, his security arrangement had to be less overt whenever he was outside the green zone. Usually, what his security detail did when he was returning to Abuja, was to send ahead a three-car convoy with covered plates to the airport to give the impression he had left. Thereafter, a nondescript car, bullet-proof of course, took him for what was really an uncomfortable ride to the airport. No sirens blaring, no flag waving, nothing. They even stopped in traffic! Quiet lion? Yeah right. The boys did their jobs though. There were agents stationed as normal people at strategic points on the route. The cover of the last group stationed just a few kilometres from the airport was that of youngsters playing football carelessly on a field of sand. Their backup were dressed as mobile policemen doing routine checks at a checkpoint close by, a daily fact of life in any typical Nigerian city. Once at the airport though, all protocols had to be observed. The presidential wing was a green zone.

He’d always wondered about all the fuss though. Well, not really. He understood why it needed to be done. It just bothered him that he had to be so cautious in the city of his many firsts. He got to know women felt pain and pleasure the first time in the dark alleys of Yakasai. And all that blood, Gosh! Of course, it was no matter subsequently. You only saw red the first time. And even then, it was only afterwards. He would go with his boys to Sabon Gari to drink beer with the Inyamiris. On other days, they would go to the mammy market in the army barracks. Those were the two places you could buy alcohol in Kano. It used to surprise him then how many do-gooders they ran into at these water holes. Not anymore. There are just too many hypocrites in the world. His job enabled him peer into the inner recesses of peoples’ lives. After twenty years at the SS, he had simply lost the will to believe that people were capable of any good. Well, not all people. Politicians were the ones he disdained the most, including his principal. But he swore an oath. So even though the president was an inyamiri, even though the president was a Christian, even though the president was set on running for a second term at the expense of the ambition of his mentor, it was his duty to protect him. And Colonel Umar was very good at his job.

***********************

“The National Executive Committee decided today to nominate President Okpara as the consensus presidential candidate of our great party, the All Nigerian Salvation Party (ANSP). The president has accepted” said the ANSP Chairman with great cheer to a packed hall of reporters and government functionaries.

Just as Colonel Umar and his boys were beginning to feel some relief that the press conference was going exactly as planned. A reporter asked the question they had all been dreading.

“Mr Chairman, how did you get Governor Sanusi to drop his ambition?”

“You can ask the Governor himself” said the Chairman.

“Your Excellency, what made you decide to drop your ambition?” Amina asked the usually boisterous governor who was strangely subdued at the press conference.

“I realized it was inappropriate for me to contest the primaries when in fact the president was desirous of a second term. As is his right, of course” the governor replied.

“So it was not because of the corruption case pending against you and your son?” Amina wasn’t going to be brushed aside easily.

“Of course not!” The governor retorted.

No more, end the press conference. The Chairman was given the signal.

“That should do for one day, this press conference is now over. Thank you, everyone.”

Colonel Umar was about to leave quickly when Amina called him by his nickname. “Yaro na gari!” She meant that the other way round. It was more like “stop or I will call you dan iska!” Which was certainly not a compliment.

Putting on his widest smile, the Colonel played along. “How are you, Amina? Was that really necessary? Putting the Governor on the spot like that?”

“I knew you’d say that” Amina replied with a suggestive smile. The other guy moved. This woman was simply mischief. “What now?” he managed to say. “Well, you could stand there or simply take a walk with me” She knew he couldn’t do that. But then that was not what she meant as she slowly walked away. By this time, the other guy was in a sprint.

**********************

“The governor and his son are off the hook, aren’t they?” Amina always kept her head. Those curves were not the only reason he found her irresistible. She could at least try to put some clothes over those curves now that they were spent. One last glimpse, an image to trigger the next tryst.

“Umar?” Amina knew she had his attention now.

“The judge will probably look very closely at the case” Umar quickly managed to say. “You know how serious the president is with his anti-corruption campaign.” The ever-careful spy didn’t want to risk going on record even though the love of his life was the most discreet person he knew. She got the message. Now for the real ask.

“Your boys took my third-cousin into custody yesterday. He is not a member of Karatu Aha, Umar. He is not” How does she do it? Umar wondered. Change subjects like that.

“If he is in custody, it must be because they have evidence of his involvement” Colonel Umar coolly replied.

“Don’t give me that bullshit, Umar!” Amina was raising her voice now. “You are letting a governor whose son was caught with millions of dollars at the airport go scot-free. But in the case of my brother, you remember all of a sudden that you are a professional”

“That boy must not stay a single night in detention! You hear me?” She had him in her mouth now. Amina was a weakness.

**********************

There were still other stones remaining in the president’s shoes. One in particular. The guy simply wont’ let go. Because he was very publicly and vociferously opposed to the president, eliminating him was not a feasible option. The blowback on the president would simply be too much to handle were that to occur. As he was also a very highly respected public figure, making him disappear was also not an option. What to do? Colonel Umar was still mulling this when his phone rang.

It was the red line. Something was up. Just then there was a news flash on the TV screen.

“Bomb blast hit convoy of prominent opposition politician”. He did not need to answer the call. He’d been summoned.

The president was furious.

“My instructions were very clear. There were to be no targeted assassinations. We are no longer in the military era”. Ever the professional, Colonel Umar let the president let off steam before clearing his throat.

“Mr President, it was not us. We didn’t order the attack. He seemed surprised. That was understandable for a civilian in any case. Otherwise, he would know that fighting men kept their word.

“So, who did?” asked the still ruffled leader.

“I have a theory”. Colonel Umar prepared himself for another embarrassing show of naivete by the relatively inexperienced head of state.

“I think he did.”

“Who is he?” he retorted.

“I think General Soho organized the attack on himself”

“You know it has been problematic for him politically. The increased spate of attacks just after he lost the last elections”

“That is the most ridiculous stuff I’ve heard in a while, Umar. How could he order an attack on himself when he could have been killed? It is irrational.” The furrowed brow of the man suggested the spy’s theory struck a chord though.

“He survived, didn’t he? Well, it is probably ridiculous as you say.” Colonel Umar wasn’t just a spy.

“One thing is for sure though, you have your work cut out for you in the upcoming elections.” The baKano didn’t say that of course. He was more politically astute than that. But then spies do their masters’ bidding. So yes, he also had his work cut out for him in the upcoming elections!

**********************

*”Tazare” means “To proceed” in the Hausa language. It is used colloquially in Northern Nigerian political circles when referring to a political office-holder’s self-succession or second-term plans.

*”Tazarce” is a work of fiction. Names, characters, places and incidents either are the product of the author’s imagination or are used fictitiously. Any resemblance to actual persons, living or dead, events or locales is entirely coincidental.

 

Africa’s trade with the developed world: Reflecting on trade preference schemes (Part I)

By Rafiq Raji

SSA Exports to EU and US

Views on the developed world’s trade preference schemes with African countries are mixed. The European Union (EU) Economic Partnership Agreements (EPAs) have “failed to boost local economies and stimulate growth in African, Caribbean and Pacific (ACP) countries.”[1] Between 1978-2002, ACP exports to the EU actually declined from 7% to 3%.[2] Re-negotiated EPAs, which technically come into effect on October 1, 2014, are supposedly aimed at changing this. Reservations that they would achieve their stated goals of trade development, sustainable growth and poverty reduction remain. Also, the United States’ trade preference scheme with African countries, the African Growth and Opportunity Act (AGOA IV), which expires in September 2015 (if it is not renewed by the US Congress), enters its final year on October 1, 2014 as well. The consensus view is that AGOA has been relatively successful. This is principally because of its more flexible Rules of Origin (ROO).

Duty-free access for Africa’s exports supposedly should make its goods cost competitive relative to say, Asian ones. Tariffs and duties that would have been paid by African exporters had there been no trade preferences also add to capital for incremental investment. With predictable demand for its exports consequently, these schemes are expected to help generate employment and contribute to growth. That has largely not been the case because some of the quality specifications in these agreements are beyond the technological reach of most African countries. Flexible ROO mitigate this by allowing subject countries to import intermediate inputs and yet still enjoy preferential market access. The re-negotiated EPAs address this hitherto rigid ROO requirement that has been argued to be responsible for the failure of the Yaounde and Lome Conventions (1975-2000) to engender increased ACP exports to the EU. For instance, the EU-West Africa EPA will allow subject countries “produce goods for exports to Europe using materials sourced from other countries without losing the benefit of the free access to the EU market.”[3] The devil would be in the fine details of these agreements.

My continuing skepticism about these agreements being in the long-term industrial development interests of African countries pushed me to ask for the views of Dr. Adam Elhiraika of the United Nations Economic Commission for Africa (UNECA) at the launch of UNECA’s 2014 Economic Report on Africa (“Dynamic Industrial Policy in Africa”) on 24 September 2014 at Chatham House in London. It was important to me to hear the views of a respected economist who was also African. He believes the EPAs should be re-negotiated for the same reason. A survey of the literature also points to strong views about the cost-benefit trade-offs of these agreements for Africa’s industrial development. Whether these new ones would finally help the continent grow its industrial base remains to be seen.

Trade preferences spur growth under the following conditions: (1) Easy import of complementary inputs (2) Availability of skills and infrastructure that meet global standards.[4] Africa falls short on both conditions for internal and external reasons. Logistical bottlenecks at its ports and foreign exchange policy constraints constitute major hindrances. Corruption and cronyism are also problems. Imports of complementary inputs need to be tariff- exempt for the final goods to remain cost-competitive. Tariff concessions have instead been used as tools of political patronage by most African countries. So, there is a governance problem that is wholly and entirely African. In regard of a skilled workforce, the continent remains bereft. The continent also continues to run a very large infrastructure deficit. There are other supply-side constraints as well. Some of them are: still relatively lower labour productivity, little or no scale economies, and shallow capital markets. The expected relocation of the more value-adding, employment-generating and growth-driving labour-intensive manufacturing from Asia to Africa has not been forthcoming precisely because of these constraints. This is in spite of a widening wage gap between the two continents. The economic argument is that gains that would be given up when an Asian manufacturer relocates to Africa still remain relatively higher. The reverse has to be the case to induce relocation.

[1] http://www.ec.europa.eu/trade/policy/countries-and-regions/development/economic-partnerships/

[2] http://www.ec.europa.eu/trade/policy/countries-and-regions/development/economic-partnerships/

[3] http://trade.ec.europa.eu/doclib/docs/2014/july/tradoc_152694.pdf

[4] Venables, T. Collier, P. 2007. “Rethinking Trade Preferences: How African can diversify its Exports” The World Economy 30 (2007): 1326-45