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January 2013 Customs Connectivity Passes Test The first live demonstration of an end-to-end customs connectivity solution was successfully completed in Windhoek, Namibia on December 12, 2012.

real-time trade statistics. The demonstration was witnessed by the Commissioners of Botswana and Namibia Customs, senior managers and operational teams.

It demonstrated how clearing agents/traders would manage the flow of their information via the secure online User Portal.

The demonstration marked a watershed moment in turning Customs Connectivity into reality.

1 January 2013 Customs Connectivity Passes Test The first live demonstration of an end-to-end customs connectivity solution was successfully completed in Windhoek, Namibia on December 12, Customs Connectivity enables customs administrations from different countries to share information seamlessly and instantly across borders: reducing processing time and improving access to reliable, real-time trade statistics. The demonstration was witnessed by the Commissioners of Botswana and Namibia Customs, senior managers and operational teams. The demonstration involved moving information from an ASYCUDA++ entry in Botswana via the Cloud-based User Portal to an ASYCUDA++ entry in Namibia, and vice-versa from Namibia to Botswana. It demonstrated how clearing agents/traders would manage the flow of their information via the secure online User Portal. Electronic connectivity will drastically reduce the time taken to clear goods at border posts between Namibia and Botswana. The demonstration marked a watershed moment in turning Customs Connectivity into reality. The next steps for the pilot project include full system testing and documentation before end-user training commences. Full implementation is scheduled to take place during the first half of Customs Connectivity offers countries in the region a historic opportunity to engage cutting-edge technology and modern tools to facilitate trade throughout Southern Africa, enhancing economic growth and promoting food security. The pilot project is being implemented by Botswana and Namibia, supported by the USAID Southern Africa Trade Hub. PO Box , Tholo House, Plot 50668, Fairgrounds, Gaborone, Botswana, Phone: (+267) , info@satradehub.org The views expressed in this publication do not necessarily reflect the views of the United States Agency for International Development or the United States Government.

Warehouse Receipts Help Farmers Store Up for a Better Future Across Southern Africa, smallholder farmers sell their produce right after harvest when markets are in surplus and prices are low.

With the support of the Trade Hub, the Agricultural Commodities Exchange for Africa (ACE) has developed a warehouse receipts system in Malawi.

2 Warehouse Receipts Help Farmers Store Up for a Better Future Across Southern Africa, smallholder farmers sell their produce right after harvest when markets are in surplus and prices are low. If they could wait to sell, they would reap the benefit of more favorable prices. With the support of the Trade Hub, the Agricultural Commodities Exchange for Africa (ACE) has developed a warehouse receipts system in Malawi. The system enables farmers to deposit their crops in a warehouse, receive a receipt for the product, and access bank loans against the receipt as collateral. The farmer thus has access to funds to cover basic needs and can wait to sell the product in response to market demand. Renewable Energy Course Provides Powerful Training The Southern Africa Trade Hub and the Regional Electricity Regulators Association of Southern Africa (RERA) conducted a Clean Energy Policy Training Workshop in Johannesburg, South Africa on December Thirtyeight participants from six countries Angola, Lesotho, Namibia, South Africa, Swaziland and Zambia attended the course facilitated by Professor Allan Brent of the Centre for Renewable and Sustainable Energy Studies at Stellenbosch University. The workshop was aimed at building the capacity of energy regulatory agencies, government departments, utilities and private sector players from the Southern Africa region in designing appropriate renewable energy policy briefs for the development and deployment of clean energy technologies. In order for the receipt system to work, comprehensive rules, procedures, and documentation satisfying bank requirements must be provided. On behalf of ACE, the Trade Hub rewrote the warehouse receipt process and created a credit policy model which was submitted for approval to the credit committees of participating banks. As a result of these efforts, First National Bank of Malawi became the first to finance warehouse receipts issued by ACE. In the first full season of operation, warehouse receipts were issued for more than 4,000 metric tons of maize in certified warehouses, 500 tons of which were deposited directly by smallholder farmers who received more than $100,000 US in financing. Most of these farmers had never received bank financing previously. The majority of farmers deposited their crop in June 2012 when the average price for maize was 40 MWK (Malawi Kwacha) per kilogram. By the end of the year the price was approaching 80 MWK/kg. If farmers choose to sell at today s price, even after deducting interest and storage charges, they would make an approximate 60% net profit compared to farmers who sold in June. This initiative is expected to improve farmer viability and boost food security. The workshop included sessions on renewable energy technology systems and trends; policy mapping and how to develop appropriate policy briefs; regulations and laws associated with renewable energy; financing and structuring finance for renewable energy investment; and assessment of renewable energy systems. The sessions included practical group work on developing and presenting policy briefs, which the participants found immensely valuable as they were able to interact, exchange ideas and share practical experiences. This course has been of real value to me because my country has prioritized renewable energy in its energy policy, and country dialogue has started in earnest on how the renewable energy sector can be developed, especially for the benefit of remote rural areas. Mr. Adriano De Almeida, Office of the Minister of Energy and Water, Angola 2

Helping Laboratories Make the Grade The Southern Africa Trade Hub has made a $100,000 US grant to fund training for testing laboratories in the agro food production and processing sector.

3 Helping Laboratories Make the Grade The Southern Africa Trade Hub has made a $100,000 US grant to fund training for testing laboratories in the agro food production and processing sector. Agro food processing is a priority sector for development in Southern Africa, yet a significant roadblock remains before the sector can achieve full growth. In order for the region to benefit fully from its agricultural resources, products from the sector must exhibit a certain level of quality and quantity, as well as conform to international standards for export. SADC countries currently employ the services of testing laboratories and certification entities, but these services are not internationally recognized. Testing must therefore occur in the importing country upon arrival at a high level of cost and inefficiency. To help address this situation, the grant from the Trade Hub was made to the Southern African Development Community Accreditation Service (SADCAS) to improve knowledge and understanding of the importance of standards and accreditation of agro food production and processing testing laboratories in Mozambique, Malawi, Zambia and Zimbabwe. The grant funds a series of sessions on the requirements of ISO/IEC 17025, which is the key accreditation standard for testing laboratories. The following courses are conducted by qualified and talented trainers with hands-on experience implementing and leading internal audits of ISO/IEC 17025: 1. One-day awareness courses on ISO/IEC were held to educate participants on the benefits and importance of accreditation, the requirements of the accreditation process, and the role management should play. These oneday courses already took place in the fall in Zimbabwe, Malawi, Mozambique, and Zambia. The sessions benefitted 73 participants from 21 testing laboratories, including government standards laboratories, veterinary and food and drug control, phytosanitary and research institutions, and private industry. 2. An intensive five-day course will cover requirements, implementation, and internal auditing skills related to ISO/IEC for laboratory staff to strengthen the ability of testing laboratories to meet accreditation requirements and monitor compliance. These sessions are scheduled for February/March Once participants complete these courses, it will take at least one year to implement the training and prepare for SADCAS to conduct an accreditation audit. SADCAS is the accreditation body for the SADC Region (in cooperation with SANAS in South Africa); therefore it cannot physically assist these laboratories in meeting the stringent requirements of ISO/ The Southern African Trade Hub will be monitoring the laboratories that complete the fiveday course to determine if additional technical assistance can be offered to bring them closer to accreditation. The ability of agricultural food products to conform to rigorous standards will help Southern Africa achieve a fully integrated regional trade zone: improving international competitiveness, intra-regional trade and food security. Upcoming Activities Deadline for GAFSP Proposals January 31 The Global Agriculture and Food Security Program seeks proposals for sustainable projects that support agriculture, increase productivity, and expand access to finance and markets. GAFSP supports private firms and financial institutions operating in eligible low-income countries. The deadline for proposals is January 31, 2013, and eligibility criteria can be found on the website World Research Soybean Conference: Understanding the Full Soybean Value Chain February 17-22, Durban The conference includes a technical program and trade show showcasing all aspects of the industry including seed; oil and fat; foods and drinks; soybean fiber products; animal feed; processing equipment and more. The Trade Hub hopes to sponsor participants to attend this global forum to exchange information and research findings. 3

4 Source Africa April 9-12, Cape Town Two days of exhibition and country pavilions, a business matchmaking program, factory site visits and business seminars will showcase Africa s textiles, apparel, and footwear industry, offering participants the opportunity to network with international buyers and African manufacturers. WCO IT Conference and Exhibition 2013: Effective Solutions for Coordinated Border Management May 14-16, Dubai 800 representatives of regional and global customs bodies and security solutions, as well as representatives of the Trade Hub, will attend the conference to discuss solutions for better coordination among global customs bodies to manage the flow of goods and check the entry of illegal items while facilitating legitimate trade. Export Digest The Export Digest covers export-related matters including Trade Hub export-related activities, export marketing, trade finance, export logistics, international trade law, export administration, export sales contracts and export success stories under the African Growth and Opportunity Act (AGOA). We answer readers questions about practical export-related matters and highlight important trade-related developments such as new trade agreements or regulatory changes. International trade experts, exporters and importers feature as guest contributors to the column to share their experiences. Write to exportdigest@satradehub.org with your suggestion for a topic or question. Or start a conversation via our Facebook Page Apparel Export Performance under AGOA This article will give a statistical glimpse of Sub-Saharan Africa s performance under the African Growth & Opportunity Act (AGOA), with special focus on textiles/garments. A total of 41 Sub-Saharan Africa countries (including South Sudan) are AGOA-eligible. AGOA accords duty-free-quota-free (DFQF) treatment for eligible apparel articles made in qualifying sub-saharan African countries through To be eligible for apparel benefits, a country should have in place an effective visa system to prevent illegal transshipment and use of counterfeit documentation, as well as effective enforcement and verification procedures. Of the 39 AGOA eligible countries, 26 have been declared eligible for the apparel provision, and 13 are not eligible.* AGOA describes "transshipment" as claiming a textile or apparel article for preferential treatment that is false with respect to country of origin, manufacture, processing or assembly of the article or any of its parts. If transshipment is found, the U.S. will deny all benefits for future textile or apparel shipments from the transhipping sub-saharan African exporter for five years. Qualifying articles include: apparel made of U.S. yarns and fabrics; apparel made of sub-saharan African (regional) yarns and fabrics until 2015, subject to a cap; apparel made in a designated lesser-developed country of third-country yarns and fabrics until September 30, 2015, subject to a cap; apparel made of yarns and fabrics not produced in commercial quantities in the United States; textile or textile articles originating entirely in one or more lesserdeveloped beneficiary sub-saharan African countries; certain cashmere and merino wool sweaters; and eligible handloomed, handmade, or folklore articles, and ethnic printed fabrics. (Source: OTEXA) Here is the general picture of exports under AGOA: In 2010, non-energy exports constituted US$4bn of the $44bn total exports under AGOA. Of the $4b, only 18% ($730m) was textiles and apparel. In 2010 Sub-Saharan Africa exported textiles/garments worth about $730m followed by about $855m in Year to date (January to September, 2011 saw the US importing textiles/apparel worth $635m and $610m in the same period in * There were 41 AGOA-eligible countries, but as of January 1, 2013, a total of 39 sub-saharan Africa countries are eligible for AGOA benefits. After the 2012 annual review, the United States declared Mali and Guinea Bissau to be ineligible and added South Sudan to the eligible list, bringing the current total to 39 eligible countries. 4

5 $1.02 $2.17 $0.85 $ (US$53.8b) Energy- related products Transporta>on Equipment Tex>les & Apparel 2010 (US$44b) $0.41 $0.730 $1.99 $0.77 $48.80 Minerals & Metals $40.00 In 2011, the $855m textiles and apparel exports under AGOA constituted 17% of non-oil exports saw a 14% increase in textiles/apparel exports under AGOA. According to the recent Brookings Institute report (AGOA: Looking Back, Looking Forward), during the last 10 years, on average more than 70 percent of Sub-Saharan Africa s exports to the U.S. have been duty free under AGOA or GSP (Generalized System of Preferences). On a country by country basis, the data is as follows: Textiles/Apparel Exports under AGOA Source: USITC Country YTD 2012 (Jan- Jun) Lesotho 280, , ,103 Kenya 200, , ,891 Mauritius 117, ,544 76,503 Swaziland 92,359 76,580 24,540 Botswana 11,559 15,475 6,480 Malawi 10,219 13,492 3,281 Ethiopia 6,512 9,981 6,378 South Africa 8,591 6,107 2,675 Tanzania 1,849 5,119 3,704 Ghana 803 1, Nigeria Uganda Mozambique Namibia 8 Totals 855, ,289 Lesotho, Kenya, Mauritius and Swaziland (in that order) are the torch bearers in terms of textiles/garment exports under AGOA. The global economic downturn is evident in the decline shown above. Conversations are currently underway on whether AGOA is likely to be extended; check back as we will discuss this question in a future issue. For more information about: AGOA, please visit: Cos Mamhunze, Column Editor Cos is an international trade specialist with more than 12 years of experience promoting international trade between Africa and the US and intraregional trade within Southern Africa. His experience has included working with small and medium enterprises (SMEs) and large firms, womenowned enterprises, importers, exporters, trade support institutions as well as government departments. Cos holds a MBA and has studied International Trade Management. Opinions expressed in this column are not necessarily those of USAID or the Trade Hub. 5

AGOA 101 Uganda. How to export duty-free from Uganda to the U.S. under the African Growth and Opportunity Act (AGOA)

AGOA 101 Uganda. How to export duty-free from Uganda to the U.S. under the African Growth and Opportunity Act (AGOA) AGOA 101 Uganda How to export duty-free from Uganda to the U.S. under the African Growth and Opportunity Act (AGOA) hat is AGOA? The African Growth and Opportunity Act (AGOA) is a United States Trade