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<p>The Central Corridor of the East African Community (EAC) has embarked on various infrastructure projects that aim to facilitate trade in the region. However, lack of financing among other deterrents has been hindering their completion. Dieudonne Dukundane, Executive Secretary of the Central Corridor Transit Transport Facilitation Agency joins CNBC Africa for more.</p>


EAC’s Central Corridor projects and its financial challenges in facilitating trade

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<p>Over the past 5 years, the East African Community (EAC) has reduced the bottlenecks on both the central and northern corridors as a way of facilitating trade in the region but despite this a number of challenges hindering the logistics industry still remain. Director of Transport at Trademark East Africa (TEA), Abhishek Sharma joins CNBC Africa for more.</p>


More intra-Africa trade needed: Challenges faced by logistics industry in EAC

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<p>Oil prices are down in early trade, as rising U.S crude inventories and weak economic data from China erased some of the sharp gains from Tuesday&#8217;s 4.7 per cent surge. To review the global oil markets and the impact on Nigeria&#8217;s oil and gas space, Rolake Akinkugbe-Filani, Senior Vice President and Head of Energy and Natural Resources at FBNQuest Merchant Bank joins CNBC Africa for more.</p>


Oil prices continue to decline as U.S-China trade war deepens

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<p>Augusto and Co say the Nigerian capital market must begin to position itself for cross border listings as they believe Nigeria&#8217;s signing of the African Continental Free Trade Agreement throws up some significant upsides. Head of Research at Augusto and Co, Jimi Ogbobine joins CNBC Africa for more.</p>


Augusto and Co: AfCFTA to boost Nigeria’s capital market

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<p>Improving trade integration across the continent has seen some traction in recent years, but what are some key trends to note with regards to trade in West Africa? CNBC Africa&#8217;s Kenneth Igbomor caught up with Muyiwa Oni, Regional Head of Equity Research at Standard Bank group to discuss the dynamics of trade in West Africa.</p>


The dynamics of trade in West Africa explained

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<p>According to data released by Statistics South Africa, the country’s total employment increased by 87 000 in the quarter ending December 2018. The drivers of these increase was sectors such as business services, trade, community services and transport industry. However there was job shedding in the construction, mining and quarrying, manufacturing and electricity industry. Employment increased by 134 000 or 1.5 per cent year-on-year between December 2017 and December 2018. Lebo Nke, Executive, Harambee Youth Employment Accelerator joins CNBC Africa for more.</p>


SA quarterly employment ticks up 87 000

<p>STRASBOURG (Reuters) &#8211; The European Union should offer a free trade agreement to the whole of the African continent and a new investment alliance, European Commission President Jean-Claude Juncker said in a keynote speech on Wednesday.</p>
<p>Among various proposals for EU action to bolster prosperity in the world’s poorest continent and Europe’s close neighbour, the Commission chief called for a more equal partnership and investment rather than aid, as Europeans look for ways to stem an economic divide driving Africans to try to migrate northward.</p>
<p>Juncker said he had talked with African leaders and was proposing an alliance to boost sustainable investment, which he said could create up to 10 million jobs in Africa in the next five years.</p>
<p>While it was clear that a free trade pact would be some way off, and well after Juncker steps down in a year’s time, the EU would look to take advantage of African efforts to forge a free trade area within the continent to work towards a comprehensive continent-to-continent trade agreement.</p>
<p>Trade between Africa and Europe, said Juncker, was not insignificant &#8211; 36 percent of Africa’s trade is with the European Union, compared to 16 percent with China and 6 percent with the United States.</p>
<p>“But this is not enough,” Juncker told the European Parliament.</p>
<p>“I believe we should develop the numerous European-African trade agreements into a continent-to-continent free trade agreement, as an economic partnership between equals.”</p>
<p>The European Union already has a series of deals with individual African countries, largely in North Africa, as well as additional economic partnerships with African blocs, such as the Southern African Development Community.</p>
<p>Other agreements with other African blocs and countries, designed to increase access to the EU market and promote development, are pending or partly in place.</p>
<p>Reporting by Alastair Macdonald; editing by Philip Blenkinsop</p>


EU could offer the African continent a free trade agreement, what you need to know…

<p>CAPE TOWN (Reuters) &#8211; Britain will use its international aid budget to boost its national interest and deepen trade ties with Africa, Prime Minister Theresa May will tell an audience in South Africa on Tuesday.</p>
<p>May, battling to unite her divided party over her plan to take Britain out of the European Union, will also visit Nigeria and Kenya as part of a three-day visit to Africa alongside a group of business delegates.</p>
<p>She is expected to recommit to maintaining the overall British aid budget at 0.7 percent of economic output but will add that she will be “unashamed” to use it in a way that helps Britain.</p>
<p>The target has previously come under fire from many of May’s own lawmakers who say it is a blunt tool that is too high and should be spent elsewhere or in Britain itself.</p>
<p>May will say she wants Britain to become the biggest investor in Africa out of the countries in the Group of Seven nations, overtaking the United States, by using the aid budget to help British private sector companies invest on the continent.</p>
<p>“I am unashamed about the need to ensure that our aid programme works for the UK,” May will say in her speech, according to extracts released by her office.</p>
<p>“Today I am committing that our development spending will not only combat extreme poverty, but at the same time tackle global challenges and support our own national interest. This will ensure that our investment in aid benefits us all, and is fully aligned with our wider national security priorities.”</p>
<p>Writing by Kate Holton; editing by Michael Holden</p>


May in South Africa to discuss Britain’s plans to boost trade in Africa, what you need to know…

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<p>In the spirit of spearheading trade across emerging economies, the Indian prime minister, Narendra Modi is in Uganda, the first visit by an Indian prime minister in over 20 years to promote bi-lateral relations between the countries. He addressed Uganda&#8217;s parliament and spoke on the Indo-Africa trade.</p>


Indian Prime Minister Narendra Modi addresses Ugandan Parliament

<p>Justina Crabtree</p>
<p>Source: <a href="https://www.cnbc.com/2018/07/24/china-xi-india-modi-visit-rwanda-kagame.html">Xi and Modi just visited Rwanda and supplied millions of dollars, here&#8217;s why</a></p>
<ul>
<li>Chinese President Xi Jinping and Indian Prime Minister Narendra Modi have just paid separate visits to Rwanda, pledging over $300 million in loans to the tiny, landlocked African country.</li>
<li>Rwandan President Paul Kagame is spearheading a pan-African single market. His country is currently in a trade spat with the U.S. over second-hand clothes.</li>
<li>Xi and Modi are both travelling in Africa ahead of a BRICS summit in South Africa which begins on Wednesday.</li>
</ul>
<p><img loading="lazy" decoding="async" src="https://cdn.cnbcafrica.com/wp-content/uploads/2018/07/24170224/105348507-1532428938287gettyimages-1004166358.1910x1000.jpg" alt="" height="1000" width="1910" data-licensor-name="Simon Maina | AFP | Getty Images"/></p>
<p>The leaders of the world’s two largest emerging economies have both just visited the tiny, landlocked African country of Rwanda – separately – and showed themselves to be friends with deep pockets.</p>
<p>Chinese President Xi Jinping landed in Rwanda’s capital Kigali on Sunday, where he met with his Rwandan counterpart Paul Kagame.</p>
<p>China granted Rwanda a loan of $126 million for the building of two roads, the latter country’s Minister of Finance Uzziel Ndagijimana told Reuters. </p>
<p>On Monday evening, after Xi’s departure earlier in the day, Indian Prime Minister Narendra Modi touched down in Kigali. Meetings resulted in the signing of two loan agreements each worth $100 million, for investment in agriculture and the development of special economic zones.</p>
<p>The meetings signified the first time a Chinese or Indian leader has visited Rwanda.</p>
<p>China and India are the world’s two most populous nations, with 1.6 billion and 1.3 billion inhabitants respectively. India is likely to be the world’s fastest growing major economy in 2018, a mantle China once held. The latter is now the world’s second largest economy after the U.S.</p>
<p>Rwanda’s recent history has been marked by civil war and ethnic conflict. It was ravaged by the genocide of its Tutsi ethnic group in 1994, in which over half a million people were killed. Home to approximately 12 million people, it is now in the process of transitioning into a middle income economy and reducing its dependence on foreign aid. The East African country is also promoting itself as a technology hub.</p>
<p><img loading="lazy" decoding="async" src="https://cdn.cnbcafrica.com/wp-content/uploads/2018/07/24170228/105348516-1532429152905gettyimages-1004472618.1910x1000.jpg" alt="" height="1000" width="1910" data-licensor-name="Simon Maina | AFP | Getty Images"/></p>
<p>Kagame is currently chairperson of the African Union. “As such, Rwanda becomes shorthand for engagement with Africa generally,” Jared Jeffery, political analyst at South Africa-based research firm NKC African Economics, told CNBC via e-mail. He added that the deals inked with China and India were a significant sum for the small Rwandan economy.</p>
<p>“Modi’s visit is arguably more notable than Xi’s as India’s ascendancy in Africa is less meteoric than China’s,” Indigo Ellis, Africa analyst at consultancy Verisk Maplecroft, told CNBC via e-mail. She added that Kagame views cooperation between the world&#8217;s developing countries &#8220;as the future.&#8221;</p>
<p>The Rwandan president is spearheading the establishment of a<br />
single market across the African continent<br />
 for goods and services which would encompass a combined gross domestic product of $2.5 trillion. The majority of the African Union’s 55 members have signed up, although Nigeria, the continent’s largest economy is<br />
yet to endorse the proposal<br />
.</p>
<p>The issue of trade may have another dimension for Kagame. “It seems that the visit (from Xi) was an opportunity to take a subtle dig at the U.S. – with which the country is having a small<br />
trade spat<br />
 over second-hand clothing” Jeffery added.</p>
<p>“China relates to Africa as an equal,” Kagame said on Monday, a statement “implying that others did not,” Jeffery pointed out.</p>
<p>“Kagame is sending a strong message to the U.S. – that Rwanda does not need Washington’s ‘paternalistic’ version of aid when China and India are ready and willing to invest in his country,” said Ellis.</p>
<p>Xi and Modi are travelling in Africa ahead of a<br />
BRICS<br />
 summit in Johannesburg, South Africa, which begins on Wednesday. Xi’s Africa itinerary began in<br />
Senegal<br />
 over the weekend, and will also include a stop in Mauritius after the South Africa meeting. Meanwhile, Modi travelled to Uganda on Tuesday.</p>


Xi and Modi just visited Rwanda and supplied millions of dollars, here’s why

<p>Justina Crabtree</p>
<p>Source: <a href="http://https://www.cnbc.com/2018/04/23/china-does-not-have-to-ask-anyone-for-respect-ghanas-president-says.html">China does not have to ask anyone for respect, Ghana’s president says</a></p>
<ul>
<li>Nana Akufo-Addo pinpointed China&#8217;s development story Saturday in a speech that promoted intra-African economic co-operation.</li>
<li>He also extolled African unity as a means of generating economic prosperity.</li>
</ul>
<p><img loading="lazy" decoding="async" src="https://media.cnbc.com/i/applications/cnbc.com/resources/img/editorial/2018/04/23/105151583-GettyImages-949191316.1910x1000.jpg" alt="" height="1000" width="1910" data-licensor-name="Dominika Zarzycka | NurPhoto | Getty Images"/></p>
<p>Ghanian President Nana Akufo-Addo pinpointed China&#8217;s development story Saturday in a speech that promoted intra-African economic co-operation.</p>
<p>&#8220;China does not ask anyone for respect now,&#8221; he said, referring to foreign students&#8217; enthusiasm for learning Mandarin as evidence of Beijing&#8217;s influence.</p>
<p>&#8220;We&#8217;ve run out of excuses for the state of our continent,&#8221; Akufo-Addo added, speaking at the London School of Economics. &#8220;If we work at it, if we stop being beggars, and spend Africa&#8217;s monies inside the continent, Africa will not need to ask for respect from anyone.&#8221;</p>
<p>China&#8217;s influence in Africa is more nuanced than simply providing loans and building infrastructure. <a href="http://www.cnbc.com/id/105114262?__source=cnbcafrica|inline|story|&amp;par=cnbcafrica &amp;doc="><br />
<strong>Ethiopia</strong><br />
</a> — among the world&#8217;s fastest growing economies with gross domestic product (GDP) expansion at 10.9 percent in 2017 — espouses a China-style state-led development model, for example.</p>
<p>Akufo-Addo also extolled African unity as a means of generating economic prosperity.</p>
<p>&#8220;Africa is losing annually more than $50 billion United States dollars through illicit financial outflows,&#8221; he said, referring to a <a href="https://www.uneca.org/sites/default/files/PublicationFiles/iff_main_report_26feb_en.pdf">United Nations report</a> led by former South African President Thabo Mbeki. &#8220;The dispiriting part of the story, of course, is the fact that some Africans are complicit.</p>
<p>&#8220;It is clear that we are not well-equipped to cope with those who come to conduct business in our countries with the aim of making extraordinary returns through unorthodox and illegal means.&#8221;</p>
<p>Akufo-Addo also highlighted the importance of a nascent <a href="http://www.cnbc.com/id/105076688?__source=cnbcafrica|inline|story|&amp;par=cnbcafrica &amp;doc="><br />
<strong>pan-African free trade agreement</strong><br />
</a> proposed by the African Union.</p>
<p><img loading="lazy" decoding="async" src="https://media.cnbc.com/i/applications/cnbc.com/resources/img/editorial/2018/04/06/105114344-GettyImages-144865684.1910x1000.jpg" alt="" height="1000" width="1910" data-licensor-name="Jenny Vaughan | AFP | Getty Images"/></p>
<p>&#8220;The free trade area will succeed as we transform the structure of our economies from economies that are dependent on the production and export of raw materials to value-adding economies,&#8221; he said. &#8220;Trade, then, is made not on the basis of raw material exports but on the basis of things we make. That is the surest route to prosperity.&#8221;</p>
<p>Less than 20 percent of trade in Africa is internal at present. At a March summit of African Union members in Kigali, Rwanda, 44 countries signed up to the pact — although, notably, two of the continent&#8217;s major economies, South Africa and Nigeria, did not. If implemented, the agreement would establish the largest trading bloc in terms of member countries since the formation of the World Trade Organization (WHO).</p>
<p>Ghana itself is among Africa&#8217;s <a href="http://www.cnbc.com/id/105067242?__source=cnbcafrica|inline|story|&amp;par=cnbcafrica &amp;doc="><br />
<strong>fastest growing economies</strong><br />
</a>. In 2017, its GDP grew by 8.4 percent, more than double that of the previous year as the West African country expanded its oil production. But, the International Monetary Fund (IMF) anticipates more modest growth this year of 6.3 percent.</p>
<p>Akufo-Addo made headlines in December for saying that it was &#8220;not right&#8221; for Ghana to depend on European funding during a press conference with French President Emmanuel Macron.</p>


China does not have to ask anyone for respect, Ghana’s president says

<p>Dr. Michael Ivanovitch</p>
<p>Source: <a href="http://https://www.cnbc.com/2018/04/16/chinas-growing-economic-presence-in-eu-causing-concern--commentary.html">Germany&#8217;s problem with China goes well beyond trade issues</a></p>
<ul>
<li>Germany has no reason to complain about China, unless it is doing that in the name of EU&#8217;s huge trade deficit with Beijing.</li>
<li>Berlin should stop bossing around European countries benefiting from Chinese investments.</li>
<li>EU should embrace, without fear, the Belt and Road Initiative because it controls its endpoints and major sale outlets.</li>
</ul>
<p><img loading="lazy" decoding="async" src="https://media.cnbc.com/i/applications/cnbc.com/resources/img/editorial/2017/06/01/104504024-GettyImages-599512812-merkel-xi.1910x1000.jpg" alt="Chinese President Xi Jinping (R) shakes hand with German Chancellor Angela Merkel (L) before their meeting at the West Lake State House on September 5, 2016 in Hangzhou, China. " height="1000" width="1910" data-licensor-name="Getty Images"/></p>
<p>China stands accused by <strong>Germany</strong> of interfering in its spheres of interest and influence in the European Union, West Balkans and <strong>Africa </strong>. Germans are also alleging that the <strong>China</strong> are using their economic clout in these regions for political ends.</p>
<p>While on a visit to Paris in August of last year, Sigmar Gabriel, Germany&#8217;s foreign minister at that time, spelled it all out: &#8220;If we don&#8217;t develop a (European) policy regarding China, then China will succeed in dividing Europe.&#8221; And in an apparent spoof on Beijing&#8217;s &#8220;one-China&#8221; mantra, he said that &#8220;we should urge China to practice a &#8216;one-Europe&#8217; policy.&#8221;</p>
<p>
<strong>Greece</strong> was one of the early flashpoints for Germany&#8217;s concern about the growing competition from China. Benefiting from Beijing&#8217;s large direct investments, Greece blocked last June an EU statement at the United Nations about China&#8217;s repressive human rights policies.</p>
<p>Hungary, where China is building a high-speed railway line from Budapest to Belgrade, joined Greece to block another EU statement criticizing China&#8217;s territorial claims in the South China Sea, after The Permanent Court of Arbitration in The Hague ruled against Beijing in July 2016.</p>
<p>Berlin is also alarmed at China&#8217;s very successful economic cooperation with 16 Central and East European countries, derisively called &#8220;the new Europeans,&#8221; in a &#8220;16+1&#8221; organization set up in 2012.</p>
<h4>Stop bossing around</h4>
<p>These are the examples of how much Germany is pushing the envelope using an old French chestnut of &#8220;préférence communautaire&#8221; — a political injunction to protect EU products and services from non-EU suppliers.</p>
<p>But the Germans are going much further. They are complaining about countries working with China which are not even the EU members — some of them merely looking for an associate status because a full membership is a drawn-out obstacles race at the mercy of centuries-old regional hatreds and rivalries.</p>
<p>Last February, for example, at a press conference in Berlin, the prime minister of former Yugoslav Republic of Macedonia was gratefully acknowledging China&#8217;s help in modernizing his country&#8217;s roads when German Chancellor <strong>Angela Merkel</strong> reminded him that there may be political conditions attached to such infrastructure investments.</p>
<p>Further to the north, Serbia is another non-EU member where China is investing billions of dollars in a construction of modern road networks, a 1.5 km bridge over the Danube River, high-speed rail lines, a large industrial park and a number of industrial projects. All that is being closely and very critically scrutinized by Germany — even though Serbia will never become an EU member in exchange for a required recognition of Kosovo&#8217;s contested statehood.</p>
<p>Things have indeed changed since the time when Otto von Bismark, the chancellor of the German First Reich, arrogantly opined that &#8220;the whole of the Balkans is not worth the bones of a single Pomeranian grenadier.&#8221;</p>
<p>Germany is also finding that China is in the way as Berlin seeks to establish a closer relationship with its former African colonies. In most of these countries, China may be difficult to dislodge because it has been operating development programs there for many years and decades.</p>
<h4>Trade smarts, not threats, with China</h4>
<p>Neither is the China&#8217;s monumental, <strong/>Belt and Road Initiative (BRI) much to German taste. That is a modern replica of ancient overland and maritime routes connecting East Asia with Europe and Africa. China, Germany claims, has too much control over the whole project. The German ambassador to Beijing says that his country&#8217;s companies should be able to participate as equal partners.</p>
<p>Interestingly, German companies don&#8217;t seem to have the same reservations. A BRI study published last February by two German business associations — Germany Trade &amp; Invest and Association of German Chambers of Industry and Commerce  — highlights &#8220;cooperation opportunities between German and Chinese businesses in sectors of infrastructure, energy and consulting.&#8221;</p>
<p>More seriously perhaps, German complaints about Chinese control have much broader implications. Media reports, for example, quote German authorities&#8217; statements that the BRI serves as an instrument to establish a Chinese world order (&#8220;pax sinica&#8221;), where even the terms &#8220;free trade&#8221; and &#8220;the rule of law&#8221; have meanings different from what&#8217;s commonly understood.</p>
<p>China is strongly denying any such intentions. At the Boao Forum for Asia last week, China&#8217;s President <strong>Xi Jinping</strong> said that the BRI was &#8220;neither the Marshall Plan after World War II nor an intrigue of China.&#8221;</p>
<p>Beijing, he said, seeks &#8220;shared growth through discussion and collaboration,&#8221; advocating &#8220;inclusiveness&#8221; and opposing a &#8220;zero-sum game … mentality.&#8221; More to the point, Xi pledged that &#8220;China will not threaten anyone else, attempt to overturn the existing international system, or seek spheres of influence.&#8221;</p>
<p>It would not be surprising if Germany begged to differ. At any rate, Germany correctly wants to see real and meaningful measures of China&#8217;s opening up to world commerce and finance. Like some other Europeans, Germans are talking of China&#8217;s &#8220;promise fatigue,&#8221; arguing that Beijing has to reciprocate — after having greatly benefited from a fairly liberal access to German and other EU markets.</p>
<p>Here are the numbers.</p>
<p>The China&#8217;s share of EU trade has almost tripled so far this decade to 15.3 percent, slightly below America&#8217;s steadily declining share of 16.9 percent.</p>
<p>Last year, China ran a whopping 176 billion euro trade surplus with the EU, while the U.S. took a 120.8 billion euro deficit. In the first two months of this year, China&#8217;s EU trade surplus was running at an alarming annual rate of 213.6 billion euro, a 21.4 percent increase over last year.</p>
<p>Germany, by comparison, has much less to complain about: Its goods trade deficit with China remains on a steeply declining trend, falling last year to 14.2 billion euro, a 21.5 percent drop from 2016.</p>
<p>Still, Germany, a powerhouse of world exports, does not seem to like that. Berlin is also very worried about China&#8217;s buying spree in the heartland of its top technologies — a recent allegedly stealthy purchase of a 9.7 percent stake in Daimler (which owns the Mercedes Benz brand of cars), an 8.8 percent ownership of the Deutsche Bank, the purchase of the robotics firm KUKA and the energy management company Ista.</p>
<p>Germans are now tightening the rules and reviews of incoming direct investments, prompting the adoption of the same procedures at the EU level.</p>
<h4>Investment thoughts</h4>
<p>The pictures of a beaming German chancellor and Chinese prime minister extolling the Sino-German &#8220;dream team&#8221; projects seem to be souvenirs of another time.</p>
<p>Sadly, however, Germany and the EU — much like the U.S. — are waking up a bit too late.</p>
<p>China has worked hard to produce and sell its wares to eager European and other overseas buyers, amassing, in the process, huge trade surpluses.</p>
<p>All the money that China has earned on its net foreign trade transactions — an estimated $130 billion in 2017 — has to be recycled in portfolio and direct investments abroad. Remember, even in China, the balance of payments has to balance — the sum of current and capital accounts must be equal to zero (with adjustments and statistical errors, of course).</p>
<p>Complaints and vilifications of China are no substitutes for thought and smart German, EU and American trade policies. Yes, do insist on fair and reciprocal trade, but Germany should stop bossing around its European customers (aka partners) to defend its trade privileges.</p>
<p>The BRI is a huge, epochal, lucrative and open-ended Eurasian project people have dreamed about ever since that Venetian nobleman and trader (Marco Polo) showed the way to Serenissima&#8217;s riches in the late 13th century. China may well control the origins of BRI routes and commerce, but the Europeans dominate the endpoints and major sale outposts.</p>
<p>That should not be hard to understand for those whipping up the political soufflés, instead of concentrating on creating wealth and building the EU&#8217;s leverage in world affairs.</p>
<p>
<em class="">Commentary by Michael Ivanovitch, an independent analyst focusing on world economy, geopolitics and investment strategy. He served as a senior economist at the OECD in Paris, international economist at the Federal Reserve Bank of New York, and taught economics at Columbia Business School.</em></p>


Germany’s problem with China goes well beyond trade issues

<p>Jeff Daniels<br />
Source: <a href="http://https://www.cnbc.com/2018/04/02/china-tariff-hit-for-us-agriculture-could-be-big-gain-for-australia.html">China tariffs could help Australia gain share from US wine, nut and fruit producers</a></p>
<ul>
<li>China&#8217;s tariff of up to 25 percent on U.S. agriculture could be good news for Australia&#8217;s nut, wine and fruit producers.</li>
<li>Almost 40 percent of Australia&#8217;s fruit exports last year went to greater China, and Chile also is a major fruit producer that could benefit.</li>
<li>Australia&#8217;s wine exports to mainland China rose 63 percent last year, while U.S. wine exports to the world&#8217;s second-largest economy were down.</li>
<li>Beijing also imposed new tariffs on American pork, a move that could benefit the European Union, Brazil and Canada — major exporters to China.</li>
</ul>
<p>
<strong>China</strong> tariff hit of up to 25 percent for U.S. agriculture could be a big gain potentially for <strong>Australia</strong>, particularly for wine and certain nut and fruit producers.</p>
<p>&#8220;We&#8217;ve invested quite a lot of time and money in building the market in China for 15 years, and then this may force us to reduce the amount of wine we&#8217;re going to sell there just because our wines will become less economically viable,&#8221; said David Amadia, president of Ridge Vineyards in the Santa Cruz Mountains of California.</p>
<p>For the last five years, Ridge Vineyards has enjoyed &#8220;consistent growth&#8221; in the Chinese market even as it competes with premium French and Italian wines as well as Australian wines. But he said the new 15 percent Chinese tariff likely means &#8220;it will sort of be a lost investment.&#8221;</p>
<p>China&#8217;s finance ministry announced in a <a href="http://gss.mof.gov.cn/zhengwuxinxi/gongzuodongtai/201804/t20180401_2857770.html">statement published Sunday</a> it would impose <a href="http://www.cnbc.com/id/105101567?__source=cnbcafrica|inline|story|&amp;par=cnbcafrica &amp;doc="><br />
<strong>retaliatory tariffs on up to 128 kinds of U.S. goods</strong><br />
</a>, following through on a <a href="http://www.mofcom.gov.cn/article/ae/ag/201803/20180302722664.shtml">threat initially made March 23</a> by Beijing that it would target $3 billion worth of American imports.</p>
<p><img loading="lazy" decoding="async" src="https://media.cnbc.com/i/applications/cnbc.com/resources/img/editorial/2014/05/16/101680066-94813416.1910x1000.jpg" alt="" height="1000" width="1910" data-licensor-name="Chris Kasson | Bloomberg | Getty Images"/></p>
<p>China is increasing the tariff on U.S. pork by 25 percent, and a new 15 percent duty will apply to other food commodities in addition to wine, including fresh fruits such as apples, cherries and citrus as well as dried fruit and nuts such as almonds and pistachios.</p>
<p>China&#8217;s government said Sunday the move follows the Trump administration <a href="http://www.cnbc.com/id/105053244?__source=cnbcafrica|inline|story|&amp;par=cnbcafrica &amp;doc="><br />
<strong>last month announcing hefty tariffs on imported steel and aluminum</strong><br />
</a>. In announcing the action last month, the White House cited national security concerns but also <a href="http://www.cnbc.com/id/105053457?__source=cnbcafrica|inline|story|&amp;par=cnbcafrica &amp;doc="><br />
<strong>initially exempted certain countries</strong><br />
</a>, such as <strong>Canada </strong> and <strong>Mexico </strong>.</p>
<p>&#8220;It&#8217;s a first step that has a lot of us concerned,&#8221; said Will Rodger, director of policy communications for the American Farm Bureau Federation, the large ag trade group based in Washington. &#8220;It will probably have some effect on pork prices. What exactly they&#8217;ll be is hard to say.&#8221;</p>
<h4>Soybeans may be target</h4>
<p>There&#8217;s concern that <a href="http://www.cnbc.com/id/105039594?__source=cnbcafrica|inline|story|&amp;par=cnbcafrica &amp;doc="><br />
<strong>soybeans could be the next agricultural commodity</strong><br />
</a> targeted by Beijing after Trump announces duties on Chinese tech products. The U.S. ships more than $12 billion in soybeans to the world&#8217;s second-largest economy, according to the U.S. Department of Agriculture.</p>
<p>&#8220;This is in many ways the calm before the storm,&#8221; said Matt McAlvanah, a former official for the Office of the U.S. Trade Representative and now a spokesman for Farmers for Free Trade, a bipartisan nonprofit agriculture-related trade group. &#8220;We expect there to be much larger and broader retaliation on ag products from the 301 trade action.&#8221;</p>
<p>Indeed, the Trump administration is widely expected to impose <a href="https://www.reuters.com/article/us-usa-trade-china/china-hits-u-s-goods-with-tariffs-as-sparks-of-trade-war-fly-idUSKCN1H81J3">more than $50 billion in tariffs</a> separate from those already announced on aluminum and steel imports, according to reports. Those additional tariffs are expected to be on everything from Chinese consumer electronics to potentially aerospace products and are following a trade investigation under Section 301 of the 1974 U.S. Trade Act.</p>
<p>&#8220;Once China gets wind of that list, you&#8217;re going to see a much larger retaliation from China that would potentially hit some of their biggest imports from the U.S., including soy,&#8221; said McAlvanah.</p>
<p>Agriculture industry executives say China curtailing U.S. soybean imports could be devastating to the American farm economy, because more than <a href="https://www.reuters.com/article/us-china-economy-trade-soybeans/soy-source-brazils-share-of-soybean-exports-to-china-hits-record-idUSKBN1FE111">60 percent of all soybeans exported now go to China</a>. The Chinese also get soybeans from South America and use most of the soybeans as protein to feed roughly 700 million pigs in the country or to make cooking oil.</p>
<h4>$20 billion at risk</h4>
<p>&#8220;The choice of what they put tariffs on is purely strategic,&#8221; said Sherman Robinson, nonresident senior fellow at the Peterson Institute for International Economics, a Washington-based think tank. &#8220;The point about the 15 percent is, in many cases it&#8217;s probably enough to drive out the [American] imports. What you will see is trade diversion to China&#8217;s other trading partners to fill in for what the U.S. loses.&#8221;</p>
<p>
<a href="https://www.fca.gov/Download/EconomicReports/MajorUSAgriculturalExportMarkets.pdf">U.S. agricultural product exports to China totaled $19.6 billion</a> in 2017 and represented just over 14 percent share of American farm exports, according to the USDA. The only larger destination is Canada, with about $20.5 billion in U.S. agricultural exports last year and nearly 15 percent share.</p>
<p>&#8220;As is the case with China, agricultural products are often among the first to be targeted in retaliation,&#8221; USDA Secretary Sonny Perdue said in a statement. &#8220;The administration stands ready to defend agricultural producers who may be harmed. As we take a stronger approach to the way we handle trade as a nation, we will use all of our authorities to ensure that we protect and preserve our agricultural interests.&#8221;</p>
<h4>Pork in crosshairs</h4>
<p>The duties, effective Monday, also apply to U.S. pork and ethanol — two major corn markets — and are likely to be felt particularly in the Midwestern states where President <a href="http://www.cnbc.com/donlald-trump/?__source=cnbcafrica|inline|story|&amp;par=cnbcafrica &amp;doc=">Donald Trump</a> enjoyed strong support in the 2016 presidential election. </p>
<p>
<a href="http://www.cnbc.com/id/105086561?__source=cnbcafrica|inline|story|&amp;par=cnbcafrica &amp;doc="><br />
<strong>One in four hogs in the U.S. is exported overseas</strong><br />
</a>, and the Chinese are the world&#8217;s top consumers of pork. At about $1.1 billion, China and <strong>Hong Kong</strong> together are the third-largest market for U.S. pork based on value.</p>
<p>For the U.S. pork industry, China also is significant because many consumers enjoy so-called variety meats from the hog that are not always popular in the American market, including some internal organs and feet of the animal.</p>
<p>&#8220;China is a very complementary relationship that allows U.S. pork producers to extract more value from the hog,&#8221; said Jim Monroe, a spokesman for the National Pork Producers Council, a trade group. &#8220;We&#8217;re hopeful that the U.S. and China can resolve their trade disputes and that we can return to more favorable access to what is a very important market for us.&#8221;</p>
<p>Competitors that stand to benefit from any U.S. market loss in pork include the <a href="http://www.cnbc.com/id/10000049?__source=cnbcafrica|inline|story|&amp;par=cnbcafrica &amp;doc="><br />
<strong>European Union</strong><br />
</a> (particularly <strong>Denmark</strong>, <strong>Spain</strong> and <a href="http://www.cnbc.com/germany/?__source=cnbcafrica|inline|story|&amp;par=cnbcafrica &amp;doc=">Germany</a>), <strong>Brazil</strong> and Canada. Around 10 percent of Australia&#8217;s pork is exported, but they do not currently ship into mainland China due to existing restrictions. </p>
<h4>US fruit vulnerable</h4>
<p>However, the U.S. could lose market share on fruit, nuts and wine to Australia. Almost 40 percent of Australia&#8217;s fruit exports last year went to China and Hong Kong, according to the Australian Bureau of Statistics. Also, <strong>Chile</strong>, <strong>New Zealand</strong> and <strong>South Africa</strong> also have been getting in on the action.</p>
<p>&#8220;The decision by the Chinese government to levy exorbitant tariff increases on U.S. produce will surely have a direct impact on California citrus producers,&#8221; said Joel Nelsen, president of the California Citrus Mutual, a trade group representing about three-fourths of the state&#8217;s $3.3 billion citrus industry.</p>
<p>Added Nelsen, &#8220;The retaliatory tariffs imposed by China hinders our ability to be competitive by increasing costs for Chinese consumers, an important market for California citrus. Family farmers in our industry will suffer from the economic fallout unless we can find alternative markets for California&#8217;s navel and Valencia oranges and lemons.&#8221;</p>
<p>Nelsen said the Australians are major competitors to the U.S. in citrus imports to China along with South Africa, Spain and Egypt, to a lesser extent. Chile also is a major importer of other fresh fruit to China, especially cherries, grapes, plums, apples and avocados.</p>
<p>Australia&#8217;s almond industry now exports more than $300 million of the product overseas, but California&#8217;s $5 billion almond industry still depends on exports since about two-thirds of the product grown in the state goes overseas and China is one of the top buyers. The Chinese tariffs on nuts also will impact macadamia nuts grown in Hawaii.</p>
<h4>Australia&#8217;s wine</h4>
<p>Meantime, Australia&#8217;s wine industry has been making inroads into China and seeing faster growth than some European competitors, due in part to <a href="https://www.wineaustralia.com/whats-happening/events/china-roadshow-2018">more marketing efforts</a>. It also comes as a result of reduced tariffs through the China-Australia Free Trade Agreement, which went into effect at the end of 2015.</p>
<p>&#8220;If U.S. wines are subjected to higher tariffs when imported into China, that would have a direct benefit to other suppliers into that rapidly growing market, especially France and Australia — the two largest suppliers of premium wines to China,&#8221; said Kym Anderson, a professor of economics at the University of Adelaide in Australia and also executive director of the university&#8217;s Wine Economics Research Center.</p>
<p>Figures from Wine Australia show the value of wine exports to mainland China grew by 63 percent to a record AUS$848 million (US$652 million) in 2017 and represented about one-third of the total export market for Australia. By comparison, <a href="https://www.wineinstitute.org/resources/pressroom/03192018">U.S. wine exports in dollars to mainland China fell 3 percent to nearly $79 million in 2017</a>, according to the Wine Institute, a San Francisco-based trade group for the industry.</p>
<p>The new Chinese tariffs follow Congress last year giving the wine industry a break by passing the <a href="https://www.wineindustryadvisor.com/2017/12/20/congress-wine-excise-tax-reduction">first wine excise tax reduction in over 80 years</a>.</p>
<p>&#8220;The tax reform we had recently helped the wine business because we got a break on our federal taxes,&#8221; said Corey Beck, CEO of Francis Coppola Winery in California&#8217;s Sonoma County. &#8220;So we were going to use that savings this year for additional stainless steel tanks. But now with the tariff on stainless coming in, our prices have jumped up dramatically. So we have to review if we&#8217;re going to go ahead with this stainless steel project for tanks.&#8221;</p>
<p>Even so, China has been a difficult market at times for U.S. wine companies. &#8220;China is a challenge for exporting wine, but many of our California and other West Coast wines have been successful in building a market there,&#8221; said Michael Havens, an export broker with California American Terroirs, a Sonoma-based distributor of U.S. wines to importers in Asia, Europe and other markets. &#8220;The compliance burden in China is huge, and documents are extensive and different at different ports.&#8221;</p>
<p>Regardless, the Wine Institute said the move by the Chinese to add a new 15 percent tariff will increase the total tariff and tax paid on a bottle of U.S. wine imported into China from just over 48 percent to almost 68 percent. It notes that Chile and New Zealand wines enter China tariff-free and only pay a 30 percent combined tax rate while Australian wines will be tariff-free starting in 2019.</p>
<p>&#8220;This new increased tariff will have a chilling effect on U.S. wine exports to one of the world&#8217;s most important markets,&#8221; said Robert Koch, president and CEO of the Wine Institute. &#8220;U.S. producers were already at a disadvantage to many foreign competitors, and this will only exacerbate that problem. We urge a swift resolution to this crisis before long-term damage is done to the U.S. wine industry.&#8221;</p>
<h4>WATCH: WH says tariffs were &#8216;legal and justified&#8217;</h4>


China tariffs could help Australia gain share from US wine, nut and fruit producers

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Why taxing the informal economy might be a huge challenge – Enelamah

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<p>What will it cost to make Nigeria’s ports more competitive with other countries? CNBC Africa&#8217;s Christycole Popoola spoke to Robert Bal, Group Managing Director, GAC about ways to remove barriers impeding trade in Nigeria.</p>


Removing Nigeria’s trade barriers

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<p>It’s the second day of the World Economic Forum in Davos and Nigeria&#8217;s Minister of Industry, Trade and Investment, Okechukwu Enelamah, joins CNBC Africa to discuss his expectations and how Nigeria can attract foreign direct investments.</p>


How Nigeria can attract foreign investors

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<p>According to Herbert Wigwe, Group Managing Director and CEO of Access Bank, the German desk will stimulate greater trade between Nigeria and Germany. CNBC Africa&#8217;s Christycole Popoola caught up with him at the launch of the German Desk Nigeria.</p>


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