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Tutwa Newsletter | April 2019


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Dear reader,

After the great response from readers to our Africa Focus in the last issue, the April 2019 edition of Tutwa newsletter will take a more international perspective.

We are, no doubt, living in the most exciting yet uncertain times. There is at once a sense of dark foreboding about what the US-China tensions portend for the future, the implications of the Brexit for African countries, and South Africa in particular. On the other hand, there is the promise contained in the evolution of new trading arrangements that span the entire African continent. Just because we cannot predict the future, does not mean we should not prepare ourselves for it. This is what we seek to do with the insights in this edition.

The global system has been going through transition for some time, something that became more glaring during the global financial crisis over a decade ago. The stresses that built up during the crisis dimmed hopes that with globalisation the world – or at least the Western world – had started an unstoppable march to prosperity. The aftermath of the crisis set into sharp relief nationalistic sentiments, especially in the west, and a growing antipathy to global integration. Many in the west saw globalisation more as a threat than as a boon to be leveraged. The rise of China and migratory trends from poorer locations to western countries posed a threat to the Western perception of prosperity.

Citizens of countries on the margins of the economy, for instance in Britain, felt a sense of disconnection from an integration mechanism, the European Union (EU). The EU’s processes were seen to be in the grip of a tiny group of bureaucrats in Brussels. In the US, the Trump administration has framed China as a rival to be confronted, and punished with a barrage of tariffs and targeted anti-immigration and anti-investment policies, there are currently developments around this issue. Peter Draper argues in his insightful article that it is a misconception to view the tensions between the US and China as a ‘trade war’. He discusses various dimensions of this tension and draws out implications for the African continent.

In this edition, we also keep you informed of the developments in the ACFTA. Faith Tigere provides an analysis of the agreement, especially the meaning of the 90% tariff liberalisation with respect to substantively expanding intra-African trade. The article makes some sharp recommendations on what needs to be taken into consideration in moving beyond the agreement to implementation. Finally, Catherine Makokera and Faith Tigere take us through the more recent developments on Brexit. Most importantly it looks at various permutations if there is a deal or a ‘no deal’ is preferred, and the implications of each preference for value chains and trade between the UK and ‘third party’ countries like South Africa.

We will continue to wrestle with these questions and generate insights for our clients and readers. We hope you enjoy the insights we bring you in this edition.
Catherine Grant Makokera & Faith Tigere Pittet et al
The British exit of the European Union (EU) is still ongoing, or rather still undecided. It is nearly three years since the referendum was held that resulted in the decision of the UK to leave the EU but the House of Commons is yet to agree to a Brexit deal. Luckily, …
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Africa's Priorities Amidst the “Trade Wars”

Peter Draper
To properly appreciate the implications of unfolding international economic conflicts centred on the US it is necessary to start with correcting a misnomer: “trade wars.” This popular media term conceals more than it reveals; a more accurate but less appealing term is “investment, technology, security, and trade wars.”
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African Continental Free Trade Agreement (AfCFTA): Status Update for Business Stakeholders and the Private Sector

Faith Tigere
On 21 March 2018, member states of the African Union met and signed the African Continental Free Trade Area. 52 out of 55 countries have signed. 18 ratifications (10 deposited with the AU and 8 have completed the Parliamentary processes). 22 ratifications for the agreement to enter into force. However, it is important to note that the agreement that was …
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Tutwa in the media

Catherine Grant Mokokera, Tutwa's Director visited the eNCA studios to give insights on the effectiveness of BRICS in the Madam Speaker show. The background of the show was inspired by Mzukisi Qobo's article - A new era for South Africa’s foreign policy.
See eNCA website for the interview
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