00:10Welcome to this edition of Business Africa.
00:13I'm your host Afolake, only lawyer to top stories this week.
00:17Can small-scale local farmers in Zambia overcome street quality and credit barriers to leverage
00:23China's new zero-tariff policy?
00:28As fuel costs climb, Nigerian consumers turn to electric vehicles despite persistent power
00:34supply challenges.
00:40Unprecedented internal demand drives historic travel boom across Africa as continental visa
00:46waivers unlock a massive self-sustaining market.
00:51China's sweeping zero-tariff policy for 53 African nations has been hailed as a historic
00:57trade milestone.
00:58But can local small businesses actually leverage it?
01:01To examine the friction between macro policy and the reality on the ground, Business Africa
01:07spoke to producers in Zambia.
01:09Here is our report.
01:11On May 1st, China removed all tariffs on imports from 53 African countries, a move hailed as
01:18a boost for trade and economic growth.
01:21But in Zambia, farmers are questioning whether the benefits promised by policymakers are reaching
01:26them on the ground.
01:28Unfortunately, the challenges that we have currently are that we are still small-scale.
01:33And for us to upscale and go into large-scale farming to a point where we can actually export, we
01:42need certain things put in place.
01:44One of the things is we need bigger land, we need bigger structures, we need constant water
01:49supply.
01:50We need to be able to produce something that is worthy of meeting the standards that are
01:56required for the international market.
01:59Then it also means we need proper credit facilities to be able to help us with the sourcing funds
02:08that we can use to upscale production.
02:11For local producers, the barrier isn't just shipping volume.
02:14It's the strict regulatory and phytosanitary rule standard in global trade.
02:20Dropping a tariff to zero means nothing if the shipment is rejected at the port of Shanghai
02:25for minor quality defects.
02:27The ideal is that simplified customs and trade regulations are given to our SMEs.
02:38You don't need an SME to jump into maybe five to six offices for them to be cleared to go
02:46and sell this particular product.
02:49So we need to make it that this particular SME is able to maybe just to go into one or
02:57two offices
02:57and thereafter they are able to transfer their product.
03:04So is Africa genuinely ready to transform raw opportunity into value-added industrial growth?
03:10To analyse the structural shift needed, we have been joined from Bamako by a renowned economist,
03:16Madibu Mao Makalu.
03:17Thank you for joining us on the show.
03:19Now, given Africa's 3% share of global trade,
03:23how can it use China's zero tariff to boost trade investment and industrial growth?
03:29I think this is an opportunity as Africa is trying to expand its role in international trade
03:36because, you know, as of now, Africa constitutes 18% of the world population,
03:42but only 3% of world trade.
03:44So you talked about non-tariff barriers, but I think we have to remember that this arrangement
03:53or this trade policy, zero trade tariff policy, has no string attached.
04:00It's non-reciprocal, meaning China is not asking Africans also to apply zero tariff policy to Chinese products.
04:12And I believe this is also an opportunity for Africa to increase its industrial base
04:20and also to attract more foreign direct investment in industrial zones.
04:27How can SMAs in countries like Mali or Zambia compete under this policy without being displaced by large foreign firms?
04:34The Africans need to really perform more and make sure that we produce semi-finished goods
04:43and we need to add value to our products because, as you know,
04:49colonial trade was based on Africans exporting raw products and importing manufactured products.
04:56This cannot continue.
04:58And as of now, China, which used to be the workplace of a workshop of the world,
05:06doesn't want to be that anymore.
05:08And Chinese are exporting 98% of exports of China are highly value-hided products.
05:15So maybe we can exchange with China.
05:18Maybe we can negotiate with China so that they localize some of the textile factories
05:24or some of the products they don't want to produce anymore in China,
05:28that they can come in economic, special economic zones in Africa and produce in there.
05:33And then there would be gradually transfer of knowledge, et cetera.
05:37With Africa's fragmentation and infrastructure gap,
05:41how can African nations effectively industrialize and negotiate with China under this framework?
05:48This is an opportunity for us to change, but it has to be gradual.
05:53And at the same time, Africa is very diverse.
05:56You have small countries, you have large countries,
05:58you have industrialized countries like Morocco and South Africa,
06:03and you have populist countries like Nigeria,
06:06and you have Seychelles, which is a very value-added country,
06:11but which has only 100,000 people in habitants.
06:14So if you want Seychelles to negotiate with China and Nigeria to negotiate with China
06:19and Mali to negotiate with China and Mali and Burkina Faso produce practically the same goods,
06:27and fortunately, there are not economies of scale,
06:30and productivity has not been raised,
06:33and we are not doing much manufacturing anyway.
06:37Because if you don't have power, which is the case for Africa,
06:41how are you going to industrialize?
06:42Because 40% of Africans still don't have access to power,
06:46and this is more than 600 million feet.
06:49Mr. Makalu, thank you so much for your time.
06:53Despite persistent power shortages,
06:56Nigeria's electric vehicle sector is growing signs of rapid growth,
07:01driven by rising fuel costs and a new generation of consumers
07:05seeking affordable mobility solutions.
07:09In Nigeria, where power outages are a daily reality,
07:13a growing number of motorists are turning to electric vehicles,
07:17as rising fuel prices make traditional cars increasingly expensive to run.
07:22The latest surge in interest comes as global oil market tensions,
07:26linked to the conflict involving Iran,
07:28push fuel costs higher,
07:30adding to the impact of Nigeria's 2023 fuel subsidy removal.
07:34For early adopters like Florence Baboy,
07:37the savings are impossible to ignore.
07:39I see that there's an efficiency when it comes to the money spent.
07:44The money that I've spent have reduced significantly.
07:50I don't have to queue for fuel.
07:53Like, you know, everybody's talking about the fuel price I've gone up.
07:56I don't even know how much, I mean, I don't know how much a litre of fuel is.
08:01But charging an electric vehicle in a country with an unreliable power supply requires flexibility.
08:09Many owners rely on a mix of grid electricity, solar power, and backup generators.
08:16We adapt in this part of the world, and even when there's no grid,
08:20there's the option of the diesel, the diesel powering, the charging point.
08:26There's also the option of solar to charge.
08:30But what's online is, yes, some people will say that,
08:33well, I'm still using diesel to charge this vehicle, but it is at a reduced emission.
08:39Industry players say economic pressures are accelerating EV adoption.
08:44NEV Electric is building a charging station expected to serve up to 3,000 vehicles daily.
08:51I think you can do it here.
08:53You can do it anywhere else, right?
08:55And that's what we're doing.
08:56Some 90 million in Nigeria still lack access to electricity, according to the World Bank.
09:01But the government is pushing ahead with plans to become an electric vehicle manufacturing hub
09:06and gradually reduce reliance on combustion engine vehicles.
09:11The Republic of Congo has joined Togo and Ghana in waving visas for all African citizens.
09:18Six countries now offer unrestricted access boost in intra-African travel and trade.
09:23Have a look.
09:26For decades, African hospitality was built for the Western gays, priced in dollars and dependent on foreign visitors.
09:33For many Africans, regional travel remained difficult, burdened by some of the world's highest aviation taxes and restrictive visa requirements.
09:43Historically, flying across Africa often meant costly detours through Europe or Middle East,
09:49but a rapidly expanding middle class is changing that picture.
09:53New data shows continental arrivals have risen from 69.6 million in 2019 to a record 81.3 million today,
10:02making Africa the fastest growing travel region in the world.
10:08What's driving the growth isn't overseas tourism, it's demand from within the continent.
10:15With 28% of all country-to-country routes in Africa fully open, more Africans are travelling across their own
10:22region.
10:22According to the African Airlines Association, 63% of all traffic carried by African airlines now remains entirely within Africa.
10:35Regional intra-African routes account for 31% of the market, rivaling traditional long-haul travel to Europe.
10:44To meet growing demand, airlines are expanding capacity, with the seat availability in East Africa increasing by more than 24%.
10:57That brings us to the end of this edition of Business Africa.
11:02For more business news and updates, stay tuned to African News or visit us online at africanews.com.
11:09See you soon.
11:16Business Africa was presented by Turkish Airlines.
11:20Business Africa was presented by Turkish Airlines.
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