This report contains a brief overview of the situation around COVID-19 for the 24 countries that form the East and Southern Africa (ESA) region. The update – the twelfth of its kind – covers the period of April to June 2022. As has become the case lately, it is almost impossible to report on any matter without mentioning the impact of COVID-19. As 2022 has commenced, this remains the case, although the effects of the virus on our daily lives are starting to abate. According to the African Development Bank’s latest economic outlook report for the East African region, economic growth is predicted to stabilize at 4.7% in East Africa and is expected to decelerate to 2.5% in Southern Africa in 2022.
Real gross domestic product (GDP) is projected to grow by 4.1% in 2022, which is markedly lower than ~7% in 2021. The deceleration in growth highlights the severity of the impact of the Russia–Ukraine conflict on Africa’s economy. This growth will be mainly driven by private consumption and investment on the demand side and continued expansion in the services sector on the supply side. The services sector, especially tourism, has illustrated strong post-pandemic recovery and is likely to remain buoyant in the medium term, supported by industry, especially in mining, underpinned by soaring metal prices.
In June 2022, the World Health Organization (WHO) encouraged member states to continue to take a risk-based approach to mass gatherings by evaluating, mitigating, and communicating possible risks. They also advised member states to continue promoting effective, individual-level protective measures to reduce transmission, such as wearing well-fitted masks, distancing, staying home when sick, frequent hand washing, avoiding closed spaces with poor ventilation, and the like. Furthermore, member states are encouraged to continue to adjust international travel-related measures based on risk assessments while proof of vaccinations is no longer required to participate in international travel.
Africa’s low COVID-19 vaccination rollout, persistent sovereign debt vulnerabilities, high debt levels, and climate and environmental concerns remain the main threats to medium-and long-term growth prospects. In addition, disruptions to global trade and supply chains — primarily in agricultural, fertilizer, and energy sectors — following the Ukrainian war and the accompanying sanctions on trade with Russia have tilted the balance of risks to Africa’s economic outlook
The WHO reiterates that mass vaccination remains our best bet to return to normal. As of 22 May 2022, almost one billion people in lower-income countries remain unvaccinated. Only 57 countries have vaccinated 70% of their population, primarily high-income countries. The WHO needs to ensure continued support to all nations to reach 70% vaccination coverage as soon as possible. Vaccine supply has improved, but absorption has not kept pace. In some countries, insufficient political commitment exists to roll out vaccines. This reality was impacted by the initial lack of political commitment to equitable vaccine access. In some, there are visible gaps in an operational or financial capacity. Essentially, vaccine hesitancy is driven by misinformation and disinformation. WHO’s primary focus is to support countries to turn vaccines into vaccinations as quickly as possible. It is critical for the WHO to ensure fair and equitable access to vaccines and that every country receives them and can roll them out to protect their people, starting with the most vulnerable.
The continued lack of access to COVID-19 vaccine supplies, unique African economic and social challenges, and the recent Russia-Ukraine supply chain shock is expected to negatively affect initial growth projections for the East and Southern African region. These challenges call for strong leadership and effective policy interventions. This situation is evident because merely three African countries have achieved the feat of a 70% vaccinated population by mid-2022.
Concerning trade, the international maritime sector continues to be hampered by port congestion, poor schedule reliability, ongoing issues with port efficiency, and accompanying services yet to operate at full capacity. Moreover, the knock-on effects of the global challenges – particularly in major hubs in China, the US, and Europe – are impacting our regional ports. On the other hand, air cargo remains a stalwart alternative to ocean freight, particularly for Africa and the Middle East. African airlines continue to be the best-performance airlines globally. Fortunately, many existing border challenges have been alleviated for cross-border road freight, although some remain. Consequently, the continued smooth functioning of trade will require the collective input of all parties involved.
- 1. Africa’s economic outlook 2022
- 2. Continent overview
- 3. Impact on trade
- a. Global services trade
- c. Global merchandise trade
- d. Trade and development (UNCTAD)
- e. Ocean freight industry
- f. Airfreight industry
- g. Road freight industry
- 4. Vaccine rollout recommendations
- 5. Economic recovery recommendations for African countries
- a. African Union and the OECD Development Centre
1. Africa’s economic outlook 2022
Most businesses remain affected by the prolonged impact of the COVID-19 pandemic after the outbreak of the Omicron variant in December 2021. The outbreak of the Omicron variant and the followed Russian-Ukraine war hindered economic growth prospects in African countries and threatened their economies to move into a state of stagflation. According to the African Development Bank’s latest African economic outlook report, economic growth is predicted to stabilize at 4.7% in East Africa and is projected to decelerate to 2.5% in Southern Africa in 2022 as the effects of significant fiscal stimuli diminish. However, in the wake of the COVID-19 pandemic and the Russian-Ukraine conflict’s aftermath, Africa’s growth outlook is highly uncertain, with risks currently outweighing the opportunities. The spillover effects from the Russia–Ukraine conflict and related sanctions on Russia may cause a more considerable decline in global output than presently projected. In addition, a combination of low COVID-19 vaccination rollout and the emergence of new COVID-19 variants may force countries to retain a certain measure of restrictions.
Economic growth is predicted to stabilize at 4.7% in East Africa and is projected to decelerate to 2.5% in Southern Africa in 2022 as the effects of significant fiscal stimuli diminish.
The COVID-19 pandemic is delaying African economies’ convergence with the rest of the world. In 2022, African economic growth is projected to be a full percentage point below the global rate of 4.9%, while the real gross domestic product (GDP) is projected to grow by 4.1% in 2022, which is markedly lower than the approximate 7% in 2021. Under current projections, it will take African countries more than five years to regain their pre-COVID share of approximately 5% of the world’s GDP. Weaker global demand for commodities, supply chain disruptions and necessary sanitary measures have constrained Africa’s production capacity and export activity. As a result, the projected fiscal balance in East Africa is estimated at -6.5% of the region’s GDP in 2021, and it may worsen from -5.9% of GDP in the previous year. This deterioration could partially relate to increased imports as trade corridors re-open after the COVID-19 crisis.
Domestic food price inflation remains high in Africa and the rest of the world. The second quarter of 2022 shows that 92.9% of low-income countries, 92.7% of lower-middle-income countries, and 89% of upper-middle-income countries have experienced inflation levels above 5%, with many facing double-digit inflation. The share of high-income countries with high inflation has also increased sharply, with about 83.3% experiencing high food price inflation. Moreover, according to the World Bank’s April 2022 Commodity Markets Outlook, the war in Ukraine has altered global patterns of trade, production, and consumption of commodities in ways that will keep prices at historically high levels through to the end of 2024, exacerbating food insecurity and inflation. The situation is especially dire for many African countries, which desperately depend on food imports from Ukraine and Russia.
Following the inception of the Ukrainian war, trade-related policies imposed by countries have surged. As a result, the global food crisis has been partially worsened by the growing number of food trade restrictions put in place by governments to increase domestic supply and reduce prices. As of 11 August, at least 23 countries have implemented 33 food export bans, and at least seven have implemented 11 export-limiting measures. Consequently, by June 2022, the number of acute food insecure people – whose access to food in the short term has been restricted to the point that their lives and livelihoods are at risk – increased to 345 million in 82 countries, according to the World Food Program (WFP). In addition, WFP and FAO warned that acute food insecurity could worsen in 20 countries or areas from June to September 2022, causing aggravated food security issues in Eastern African countries, especially countries such as Ethiopia, Kenya, Somalia, Sudan, and South Sudan, which are heavily reliant on food imports from Russia and Ukraine.
The challenges that the countries in East and Southern Africa are facing are manifold. Strong leadership and appropriate policy intervention are critical for development, but so is the assistance from high-income countries for access to COVID-19 vaccines and other influential institutions such as the African Development Bank. The African Development Bank’s recent East Africa Regional Integration Strategy Paper for 2018-2022 lists clear strategies for two priority areas. The priority is the development of regional infrastructure, and the second is strengthening the policy and institutional frameworks for market integration, investment, and the development of value chains.
The following section provides an overview of the recorded COVID-19 infections, deaths, and vaccine doses administered throughout Africa.
New cases and deaths reported on the African continent continuously dropped in the second quarter of 2022 following the peak of the fifth wave in Mid-May 2022 on the African continent. According to the WHO, as of 14 August 2022, 8 763 459 COVID-19 cases and 173 091 related deaths were reported in Africa. These figures result in a CFR (Case Fatality Rate) of 2%. In addition, more than 7.5 million recoveries have been recorded, giving a recovery rate of 92%. To date, countries in the East Africa sub-region have reported approximately 18% of the total number of cases reported in the African region since the inception of the pandemic, of which 368 726 cases were reported in 2022. Countries within the Southern Africa sub-region have reported approximately 64% of the total cases reported in Africa since the inception of the pandemic, of which 879 731 were reported in 2022.
Figure 1: Trends of confirmed COVID-19 cases and deaths in the African Region (cases and deaths)
Figure 1Figure 1 above illustrates the ratio between the reported COVID-19 cases and subsequent deaths since the inception of the pandemic in April 2022. It is further depicted that the number of cases peaked in December 2021, while associated deaths peaked in August 2021. The second quarter of 2022 has thus illustrated a significant decrease in the total number of cases and fatalities experienced in the African region, highlighting the milder effect associated with the Omicron variant.
Figure 2: Comparison of yearly COVID-19 trends in the African Region (lab-confirmed cases)
As illustrated in Figure 2 above, the trends in new COVID-19 cases and associated deaths have decreased in the African region, with many countries reporting very low hospital admission and fatality rates. These low hospital admission and fatality rates could indicate a new phase transitioning out of the pandemic alert phase, which could be attributed to the non-aggressiveness of the COVID-19 Omicron variant and hybrid immunity in individuals two years after the inception of the pandemic.
During the second quarter of 2022, as recorded on 31 July 2022, 216 million people in the African region had completed the primary COVID-19 vaccination series. Out of all African countries, merely three countries have surpassed the target of having a population of minimally 70% vaccinated. Rwanda has subsequently joined the likes of Mauritius and Seychelles, with a vaccinated population above 70% in the second quarter of 2022. Although these countries have relatively small populations, Mauritius has a 75% fully vaccinated population. Seychelles enjoys the status of the highest fully vaccinated African country, with a vaccinated population of 78%, while Rwanda’s population is 76% fully vaccinated. Additionally, six African countries identified as (1) Mozambique (40%), (2) Sao Tome and Principe (45%), (3) Comoros (47%), (4) Liberia (45%), (5) Cabo Verde (52%), and (6) Botswana (58%) have recorded a fully vaccinated population between 40% and 70%. Seven countries identified as (1) Burundi (0.1%), (2) Democratic Republic of the Congo (2.6%), (3) Cameroon (4.5%), (4) Madagascar (4.5%), (5) Senegal (6.3%), (6) Mali (6.6%) and (7) Malawi (7.6%) have recorded a fully vaccinated population which has yet surpassed 10%.
Figure 3 below provides an illustration of African countries in terms of the relationship between the fully vaccinated population and the partially vaccinated population.
Figure 3: Share of people vaccinated against COVID-19 as of 22 August 2022 in African countries
Source: Our World in Data
A total of 696 million COVID-19 vaccines have been delivered in the African Region, representing approximately 60 doses per 100 population ratio. Of the 696 million doses received, 410,6 million (59%) have been administered. Unfortunately, only nineteen out of 46 countries (41%) have administered fewer than 50% of doses received. The number of COVID-19 vaccination doses administered increased by 9% in July 2022 compared to June 2022. On average, 10.99 million doses were administered weekly in July 2022, compared to 10.08 million in June 2022. As illustrated in Figure 4 below, the second quarter of 2022 saw a strong surge in COVID-19 vaccination doses compared to the latter stages of the first quarter of 2022.
Figure 4: COVID-19 Vaccine doses administered monthly (millions)
The increase of administered vaccinations in Africa was mainly driven by vaccination campaigns in populous countries, as 18 out of 46 countries recorded an increase in administered vaccination doses. An aspiring example is the mass vaccination campaign in the Manyara region in the United Republic of Tanzania, which saw the vaccinated population surge from 6.4% to a plausible 21%. During this mass vaccination campaign, between 14 July and 31 July 2022, an impressive total of 157 051 people were reached and fully vaccinated. Additionally, in Côte d’Ivoire, a mass vaccination campaign was launched across the whole country, which saw the vaccinated population increase from 20.2% at the end of June 2022 to 24.8% at the end of July 2022. During this aspiring vaccination campaign, a plausible 2.146 million doses were administered, leading to 761 901 additional citizens acquiring the fully vaccinated status.
As mentioned above, 696 million COVID-19 vaccines have been delivered in the African Region. Figure 5 below illustrates the composition of the total doses received as (1) 460 million COVID-19 doses (66.1%) were received from COVAX, (2) 157 million (22.6%) from bilateral cooperation arrangements, (3) 62 million (8.9%) from the African Vaccine Acquisition Trust (AVAT), (4) 10 million (1.4%) purchased by governments, and (5) 7 million (1.0%) from unspecified sources.
Figure 5: COVID-19 doses received by African countries (in millions)
However, inequities in the light of access to critical life-saving tools in the fight against COVID-19 among communities and countries that need them most have not yet been addressed satisfactorily. Donor investments in the ACT-Accelerator, to date, have provided significant assistance to slow the effects imposed by the virus by enabling the introduction of life-saving tools. As of 13 July 2022, the WHO has received US$995.9 million in support of its COVID-19 response, and US$67.1 million have been pledged. WHO’s current funding gap against funds received and pledged is US$533 million. The amount of funds received has substantially increased from quarter one to quarter two in 2022, reducing the funding gap. This gap is reflected in Figure 6 below, which indicates the donor investments received in the ACT-Accelerator to date.
Figure 6: Contributions to WHO for COVID-19/ACT-A – data as of 13 July 2022
According to the WHO, the ACT-Accelerator needs US$23.4 billion until September 2022. Of this, WHO’s funding needs are just US$1.59 billion, less than 7% of the total ask. This situation illustrates the urgent request to the international community to fund the remaining much-needed investment. The WHO’s funding needs are shown in Figure 7 below, which indicates the WHO’s COVID-19 budget considering every major regional office across the globe. The figure further illustrates that the Regional Office for Africa enjoys the second largest allocation of funds on the budget, which translates to US$367 million to fight the COVID-19 pandemic and further promote the use of life-saving tools.
Figure 7: WHO COVID-19 budget, by major office (in US$ million)
In September 2021, the WHO set an ambitious target to have 70% of the global population vaccinated by mid-2022. Back in March 2022, just over 3% of people in low-income countries were vaccinated with at least one dose, compared to 60% in high-income countries, which fueled fears that the world was nowhere near reaching the target. The inequality of vaccine distribution rose in the first quarter of 2022 and continued through the second quarter of 2022 with the number of vaccines administered globally. Of the more than 12 billion doses delivered worldwide, only 1% have been administered in low-income countries. A new analysis by the UNDP (United Nations Development Programme) indicates that the most vulnerable countries are found in Sub-Saharan Africa, including Burundi, where less than 1% of the population is fully vaccinated. Countries such as Chad and The Democratic Republic of the Congo also had vaccinated populations under 1% in the first quarter of 2022; however, they experienced an upswing in the vaccinated population through vaccination campaigns rolled out during the second quarter of 2022.
A recent study indicated that an average increase in GDP of US$16.27 billion in 2021 would have been achieved if low-income countries had the same vaccination rate as high-income countries in September 2021. Thus, vaccine equity is stressed as severe consequences could be experienced if it is not resolved effectively. To date, several African countries have experienced a surge in their vaccinated populations; however, greater cooperation between countries is needed to mitigate the detrimental effects associated with COVID-19 as significant gaps still exist between higher – and lower-income countries.
“A recent study indicated that an average increase in GDP of US$16.27 billion in 2021 would have been achieved if low-income countries had the same vaccination rate as high-income countries in September 2021.”
The gap in the distribution of COVID-19 vaccines between developed and developing countries is visible in Figure 8 below. This map illustrates which countries have surpassed this 70% target by the WHO by mid-2022. Thus, higher-income countries such as Canada, China, Australia, and New Zealand have vaccinated more than 70% of their respective populations, while Chile, Argentina, Peru, Spain, and Ireland have also succeeded in their attempts.
However, the African continent, which predominantly consists of middle- to lower-income countries, has been wide off the mark in their attempts as only two countries (Mauritius and Seychelles) managed to achieve the goal set out by the WHO, while a third country (Rwanda) managed to succeed a month after the given deadline. These three countries do, however, have relatively small populations which do not necessarily require many vaccine doses. As previously mentioned, vaccine equity must be prioritized among global leaders as the continued vaccine inequality could have detrimental effects on those countries on the wrong end of the scale.
Figure 8: Share of Global Vaccinated Populations
Source: Global COVID-19 Access Tracker
According to a Statistics News Release from the Organization for Economic Cooperation and Development (OECD), services trade among G20 countries slowed in the second quarter of 2022. It is estimated that export growth of ↑1.1% will be achieved in the second quarter of 2022 compared to the 2.1% experienced during the first quarter of 2022. During the first quarter, imports achieved a growth rate of 2.3%, while second-quarter growth prospects are estimated at 2.2%. Growth has been supported across many G20 economies by substantial increases in travel and transport, while prolonged COVID-19 containment measures weighed on services trade in East Asia. A strong rebound in travel has primarily driven the expansion of services trade in North America during the second quarter of 2022, while, conversely, services trade slowed in Europe. A decline in intellectual, financial, and business services led to contracted exports of ↓2.7% in Germany, while travel increased imports by ↑4.6%.
Conversely, a modest increase in exports of ↑1.8% was experienced in France, which can be attributed to transport and travel, while imports contracted by ↓1.2%. Across East Asia, services trade portrayed a mixed picture, with growth in travel and transport partially offset by weak trade in other services. For example, for the first time since the first quarter of 2020, China reported a decline of ↓8.1% in services exports and ↓3.3% in imports. The slowing growth patterns experienced with import and export activity of G20 countries are portrayed in Figure 9 below, where a substantial decrease in service imports and exports is evident.
Figure 9: Import and Export Growth in G20 countries in terms of Merchandise and Services
Merchandise trade experienced an approximate ↑25% increase compared to the first quarter of 2021 and an increase of about ↑3.6% relative to the fourth quarter of 2021, reaching approximately US$6.1 trillion. As illustrated in Figure 10 below, global trade has surged since the inception of the COVID-19 pandemic, with an uptake in both imports and exports experienced worldwide:
- The East and Southern African region’s imports experienced an increase of ↑23% compared to 2021 and an increase of ↑32% compared to 2019, while exports increased by ↑30% compared to 2021, an increase of ↑32% compared to 2019. For Northern Africa, imports experienced a rise of ↑24% compared to performance in 2021 and an increase of ↑33% compared to performance in 2019. With exports, a rise of ↑39% was experienced compared to trade in 2021, while an increase of ↑34% was seen compared to 2019.
- These numbers are encouraging for merchandise traders located in Africa as the African region has experienced higher growth in terms of their exports than the likes of North America and Europe. However, the Asian region has experienced staggering export growth as merchandise exports increased by ↑81% compared to volumes recorded in 2021 and by ↑67% compared to 2019.
Merchandise trade experienced an approximate ↑25% increase compared to the first quarter of 2021 and an increase of about ↑3.6% relative to the fourth quarter of 2021, reaching approximately US$ 6.1 trillion.
Figure 10: Merchandise Trade in 2022 compared to 2019 and 2021
However, the most recent World Trade Organization (WTO) Goods Trade Barometer was issued on 23 August 2022, and the yielded results suggest that global merchandise trade growth is facing the prospects of stagnation during the second quarter of 2022. As depicted in Figure 11 below, the Goods Trade Barometer showed signs of steadiness but found itself below the recent trend line for merchandise trade, which suggests that global merchandise trade continued to grow in the second quarter of 2022. Nevertheless, the pace of growth was slower than in the first quarter of 2022 and is likely to remain weak in the year’s second half.
Figure 11: Barometer for Global Merchandise Trade
The Goods Trade Barometer is a composite leading indicator for world trade, providing real-time information on the trajectory of merchandise trade relative to recent trends. The latest reading of 100.0 coincides precisely with the baseline value of the index, indicating on-trend trade expansion. However, the overall barometer remains below its companion index, representing actual merchandise trade volumes, suggesting that year-on-year trade growth may slow but remain positive.
The goods barometer components have yielded mixed results in the first quarter of 2022, with most indices indicating on-trend or below-trend growth. The forward-looking export orders index (100.1) is on trend but has recently undertaken a downward trend moving below the trendline. The automotive products index (99.0) indicated growth patterns slightly below the trendline but have recently lost their growth momentum. Indices for air freight (96.9) and electronic components (95.6) have shown below-trend growth patterns, while the raw materials index (101.0) has recently gained momentum, which yielded growth slightly above trend. The container shipping index (103.2) is the main exception as it showed growth patterns that are firmly above trend as the ease of COVID-19 restrictions has resulted in increased shipments through Chinese ports.
In the first quarter of 2022, the volume of world merchandise trade showed slowed year-on-year growth of 3.2%, which is down from the 5.7% captured in the fourth quarter of 2021. According to this report issued by the WTO, the slowed growth experienced in the first quarter of 2021 only partially reflects the impact of Ukraine’s conflict, which broke out in late February. In addition, it is suggested that lockdowns in China and the associated closure of ports and factories also weighed heavily on merchandise trade results in the first quarter of 2022.
According to the WTO’s report on merchandise trade, global merchandise exports decreased by 0.6% in the first quarter of 2022, while “Other regions”, which include the African continent, saw the most significant decrease of -7.8%. On the other hand, Asia was the only region which experienced positive export growth of 2.2% in the first quarter of 2022, while global merchandise imports increased by 0.6% in the first quarter of 2022.
Figure 12: World Merchandise Trade Volumes
According to a Statistics News Release from the Organization for Economic Cooperation and Development (OECD), merchandise trade among G20 countries slowed markedly in value during the second quarter of 2022. Exports increased by ↑2.1% compared to the 4.8% experienced in the first quarter of 2022, while imports increased by ↑2.6% compared to the 6.2% experienced in the previous quarter. While high commodity prices, exacerbated by the war in Ukraine, continued to fuel merchandise trade growth in nominal terms, the slowing growth in value terms partly reflects the increasing value of the US dollar against other major currencies, which is highlighted by the US Dollar equating the Euro during the second quarter of 2022.
Merchandise trade was boosted during the second quarter of 2022 due to rising energy prices, with exports increasing by ↑10.2% in the United States and ↑11.0% in Canada. Merchandise trade in the European Union (EU 27) experienced modest growth of up to ↑0.3% in exports, while imports experienced faster growth of up to ↑3.0%, primarily driven by energy. However, confinement measures and inflationary pressures weighed on overseas demand for goods, which continued to disrupt economic activity in the East Asian region leading to the contraction of merchandise exports. Exports fell by ↓4.9% in Japan, ↓0.4% in China and ↓2.2% in Korea. Additionally, high commodity prices continued to drive the value of exports for the leading commodity traders in the G20, with exports expanding in Australia up to ↑12.5%, Indonesia up to ↑12.7% and India up to ↑7.1%.
The United Nations Conference for Trade and Development (UNCTAD) announced in their report on global trade that the value of global trade surged to a record US$7.7 trillion in the first quarter of 2022, which represents an increase of about US$1 trillion in comparison to the first quarter of 2021. The growth experienced in the first quarter of 2022 represents a surge of about US$250 million compared to the fourth quarter of 2021 and is fueled by rising commodity prices, as trade volumes have increased to a much lower extent. However, trade growth has continuously slowed during the second quarter of 2022 but is expected to remain positive. The UNCTAD report on global trade further states that the war in Ukraine is starting to influence international trade, largely through increases in commodity prices and shipping prices. Furthermore, it adds that the rest of 2022 will likely experience a decrease in trade volumes as interest rates soar and economic stimulus packages are depleting. Volatility in commodity prices and geopolitical factors will continue to cause more uncertainty surrounding trade developments.
As mentioned above, merchandise trade and service trade experienced growth during the first quarter of 2022. Merchandise trade experienced an approximate 25% increase compared to the first quarter of 2021 and an increase of about 3.6% relative to the fourth quarter of 2021, reaching approximately US$6.1 trillion. Trade in services experienced an increase of about 22% compared to the first quarter of 2021 and an increase of about 1.7% relative to the fourth quarter of 2021, totaling about US$1.6 trillion. Figure 13 below highlights the trade growth experienced in the first quarter of 2022 and further suggests that trade growth is expected to slow during the second quarter of 2022 but should remain positive.
Figure 13: Global Trade Trends
The report further states that the evolution of world trade for the remainder of 2022 is likely to be subject to (1) slower-than-expected economic growth due to rising interest rates, (2) inflationary pressures and (3) concerns over debt sustainability in many economies. In addition, the war in Ukraine further affects global trade by placing increased pressure on the international prices of energy and primary commodities. These rising food and energy prices would most likely lead to further heightened trade values, resulting in lower trade volumes in the short term due to the inelastic global demand for food and energy products. In addition, other factors, such as (1) continuing supply chain challenges, (2) regionalization trends, and (3) policies supporting the transition towards a greener global economy, are likely to influence the global trading environment for the remainder of 2022.
e. Ocean freight industry
i. Global container throughput
The latest RWI/ISL figures showed a significant decrease in global container throughput, which was led by the closure of some Chinese ports because of the prolonged lockdowns. The RWI/ISL index decreased seasonally adjusted from 123,3 (revised) to 122,8 points in April. The main driver was the significant decrease in throughput witnessed in Chinese ports, as the Chinese index decreased from 132,5 (revised) to 130,2 points. On the other hand, the North Range Index, an indicator of economic development in the northern euro area and Germany, increased slightly from 113,1 (revised) to 114,2 points compared with the previous month, which is above average growth for this time of year. The following figure shows the evident plateau in the throughput volume after the massive surge experienced in the aftermath of the hardest lockdown of early-2020:
Figure 14: RWI/ISL Container throughput index (2015 = 100)
The RWI/ISL Container Throughput Index consists of data from 90 international ports, constituting approximately 64% of global container traffic. As is typically the case, we look forward to seeing the movement of Drewry’s “Container Port Throughput Index“, which is more comprehensive than the RWI/ISL Index. Nevertheless, the RWI/ISL serves as a good precursor of throughput data and is released a month earlier. Looking ahead, we expect a slight increase in container throughput, as supply chain pressures have been easing in most major ports in May. For the Sub-Saharan region, the same period makes for depressing reading, as there has been a continued downward trend in imports and exports:
Figure 15: Sub-Sahara Africa container volume (imports and exports)
Compared to last year in April, imports have decreased by ↓10,2%, while exports have dropped by ↓11,9% over the same period. As a result, Africa’s situation is like the one globally, with the merchandise boom seemingly over and possibly recessionary times ahead. In summary, container throughput is still predicted to grow at a healthy rate in the coming period; however, analysts have dashed hopes of a return to some form of normality in global supply chains in the third quarter of 2022. As a result, Drewry and MSI still do not expect the supply chain crisis underpinning elevated freight rates across several trade lanes to normalize before the end of next year.
ii. Global freight rates
Global container freight rates continued their steady decline, albeit again only marginally this week, with freight rates seemingly reaching a limit. Drewry’s “World Container Index” decreased for fourteenth consecutive weeks, as the average composite index remains ↑18% (y/y), with the y/t/d average at US$8 614 per 40ft container, approximately US$5 214 higher than the five-year average of US$3 400. Despite the continued reduction in spot rates, the elevated rates have also spilt over into longer-term contracts, with Xeneta reporting that its XSI long-term contracted crowd-sourced rate index had soared ↑30% this month and is now ↑150% higher than a year ago. As container space remains at a premium given the global conditions, shippers have been placed in an unenviable position of trying to fix capacity at higher rates against the risk of not getting space at spot rates, which are, in any case, at excessive levels. Nevertheless, the following shows the one-year spot rates of the composite index:
Figure 16: World Container Index – assessed by Drewry (US$ per 40 ft. container)
Despite the recent stabilisation of rates – and an annual increase of only around ↑18% – the situation with which shippers have had to contend since the outbreak of the pandemic has been staggering, considering spot rates are now over four times higher than pre-pandemic levels when spot rates were trading around US$1 500. There are, of course, two sides to the story, as shipping lines have endured long periods of poor financial returns, whilst shippers, cargo owners and intermediaries have moved goods on the cheap. The situation is moderating, but some educated estimates are that the current volatile market trends could only stabilise by 2024. Furthermore, container rates may only decline by around 40% in the next decade, meaning a new baseline will undoubtedly be set.
iii. Global schedule reliability
According to the latest April figures published by Sea Intelligence, global liner schedule reliability has again taken a turn for the worse after the slight improvement seen last month. Liner Schedule reliability is down by ↓1,3% (m/m) to 34,6%. Although the monthly regression is insignificant, the great picture shows that the global liner network is still deeply in negative territory, as reliability levels have been low for the best part of 18 months, with the annual figure down ↓4,7% (y/y). Despite the reduced scheduling certainty, the global average delay for vessels waiting at ports has improved, as the metric decreased to 6,41 days (↓0,85 m/m). The improvement means that average delays have dropped below the 7-day mark since August 2021. That said, it continues to be the highest across each month when compared historically.
Figure 17: Global schedule reliability (%) and average days for late vessel arrivals (days)
Source: Sea Intelligence
On an individual carrier level, Maersk was once again the most reliable top-14 carrier in April 2022 at 47,5% (↓2,8%), followed by Hamburg Süd at 42,5% (↓3,4%). In addition, there were six carriers with schedule reliability of 30%-40% and six with schedule reliability of 20%-30%. Although the metric produced by Sea Intelligence provides a decent overview of the current state of liner service levels, few insights are provided in the methodology used to measure reliability. For example, is it calculated on set schedules determined when a service commences, or is it measured more flexibly considering each consecutive berthing window per port per service? Whichever method (or a combination thereof) is used, global liner services continue to be plagued by port congestion, human resources constraints, and widespread equipment shortages at key ports connecting the global network. The picture is clear enough; even if the methodology used in painting it may be obscure.
i. Air cargo chartbook
IATA issued a global air cargo market analysis for the second quarter in June, which indicated that global cargo ton-kilometers (CTKs) fell ↓6.4% (y/y) in June, which represents a slightly better performance than the decrease of ↓8.3% (y/y) experienced in May. The recent declines in seasonally adjusted air cargo volumes paused in May and showed a solid ↑0.7% (m/m) gain in June, illustrated in the first chart below. It is too soon to describe this as a recovery, but a measure of recovery can be anticipated should these gains continue, especially if China relaxes their respective COVID-19 restrictions. Latin America and Africa are the only regions showing a y/y increase in air cargo traffic. Latin America experienced an increase of ↑19.6% y/y, while Africa showed an increase of ↑5.7% y/y. Two consecutive solid monthly increases for Asia Pacific CTKs are positive developments, coinciding with the easing of lockdown restrictions in China.
Global air cargo ton-kilometers (CTKs) fell ↓6.4% (y/y) in June.
As illustrated in the second chart of Figure 18 below, global goods trade recovered further in May, mainly due to substantial volumes in regions such as Latin America, Europe, and China. Global trade recovery in the coming months will gain some much-needed support if China continues to ease COVID-19 restrictions by re-opening factories and increasing the operating workforce capacity in their ports.
Figure 18: CTK Levels and Cargo Growth Rates
ii. State of the Region: Africa and the Middle East:
On Monday, 11 July 2022, IATA released the latest “State of the Region: Africa and the Middle East” for the second quarter of 2022. It was remarkably noted that Africa is once again one of two regions that recorded growth in CTKs in May 2022 versus the same month in 2019. Africa experienced growth of approximately ↑8%, while the North American region experienced growth of about ↑15%. On the other hand, Middle Eastern cargo carriers saw their CTKs fall by ↓1% in May compared with May 2019, but it continues to have a stable growth compared to the previous quarter, illustrated in Figure 19 below.
Figure 19: Growth in Cargo Volumes by Region
However, IATA notes that this remarkable improvement can be partly attributed to the base effect from the comparison with 2019. In addition, the Omicron wave negatively impacted air traffic recovery in Africa, which led to thousands of flight cancellations and weighed on peoples’ willingness to travel. As a result, air traffic recovery has been slower in Africa than in other regions. As a result, Africa’s industry-wide passenger kilometers (RPKs) are at 70% of pre-crisis levels. Middle Eastern airlines are doing better and are currently at 90% of 2019 RPK levels, which is a better performance than in the previous quarter. The opening of the international markets, for which Middle Eastern countries serve as hubs, facilitated the recovery and will most likely drive further growth in RPKs. Compared to the previous year, international RPKs grew by ↑317% in the Middle East and ↑134% in Africa, which is the region’s most modest increase.
iii. Global outlook for air transport from the second quarter of 2022 and beyond
The global economy is facing two simultaneous and wholly global systemic crises in the form of climate change and the COVID-19 pandemic. On top of that, the war in Ukraine adds to human suffering and economic challenges. These all constitute significant headwinds for the global economy and aviation. Nevertheless, 2022 testifies to the resilience of the air transport industry. After the most considerable shock in aviation’s history, recovery is well underway and forecast to continue through 2022 and beyond. The rally in the passenger industry is expected to pace this year as vaccine rollouts continue, travel restrictions are lifted, and more routes are re-opened.
Even so, global RPKs are forecast to remain below their pre-pandemic 2019 level until 2024. Cargo is expected to continue to support the industry’s performance. It is anticipated that CTKs will rise in 2022 even as cargo yields moderate with the additional capacity from passenger aircraft coming online. Cost pressures will be a focus for airlines this year as oil and fuel prices have risen sharply, contributing to the global rise in inflation and pushing central banks to increase interest rates. In some markets, labor shortages create near-term challenges for costs and operations. As a result, the financial recovery will continue to lag traffic. The industry will likely remain in a net loss position, losing US$9.7 billion in 2022, considered a modest positive revision from FIATAs forecast at the end of 2021. Airline financial performance is expected to improve in all regions in 2022, with North America the only region expected to return to profitability this year.
Some insightful geofencing data captured by the Federation of East and Southern African Road Transport Associations (FERSATA) investigates the cross-border delays and associated costs experienced at several regional border posts. It is important to note that only certain SADC borders are currently included in the analysis. The following tables summarize several SADC border posts’ recent cross-border queue and transit times. Groblersbrug, Skilpadshek, and Lebombo border posts show the highest queueing time of 24 hours, 14 hours, and 11 hours respectively.
Tables 1 & 2: Queue times at selected SADC Border Posts
Source: TLC & FESARTA
i. Developments at the Beitbridge border post
June saw a ↑1% increase in overall traffic at Beit bridge with a ↓2% decrease in Exports but a ↑3% increase in imports. Issues with power at Beit bridge on the SA side have been dealt with as the Generators on site have been fully operational since June. For June, the Beitbridge Border post experienced an average daily volume of 793 trucks, an improvement of approximately 3.9% compared to the previous month of May. Construction on Phase 3 (the light vehicles terminal) got underway in June and should be completed by the end of November this year. The other projects are an agriculture and livestock quarantine facility, a new sewer oxidation dam, 220 border worker housing units, and a fire station. The agriculture and animal-plant projects will be completed by the end of this year, and the housing construction will be completed in April next year. The new oxidation dam had previously been turned over to Beitbridge Municipality to increase its ability to address sewage reticulation difficulties.
The border post is expected to transport five times its anticipated monthly capacity of 600,000 passengers, 30 000 commercial trucks, 15 000 buses, and 120 000 light vehicles after completing civil works. Furthermore, the upgraded facilities are anticipated to result in increased border efficiency systems and infrastructure, and it is being constructed to suit the proposed One-Stop-Border-Post between Zimbabwe and South Africa. However, infrastructure deficiencies, among other things, have been identified as a critical impediment to the complete implementation of the one-stop idea.
ii. Developments at the Lebombo border post
Lebombo saw an increase of ↑4% in overall traffic, with a ↑3% increase in Northbound & a ↑13% increase in southbound traffic. An average traffic volume of 1 587 was recorded for June, approximately 8.3% higher than in May. The daily and overall traffic increase can be attributed to Lebombo operating on a 24-hour basis since the second quarter of 2022. Negotiations between Mozambique and South Africa to run the Lebombo Border Post 24 hours began in 2015 after the two countries finally signed a bilateral agreement that the border post should be open day and night. According to the Commissioner of the South African Border Management Authority, Dr Nakampe Masiapato, the long-term plan is to convert the Lebombo Border Post into a one-stop entry to boost economic and tourism activities, reduce congestion, and alleviate crime faced by staged trucks on South Africa’s N3 route.
iii. Developments of foreign truck drivers in South Africa
During the second quarter of 2022, the Road, and Freight Inter-Ministerial Committee (IMC), in partnership with the road and freight industry stakeholders, have agreed on an eleven-point action plan to deal with industry challenges and the recruitment of foreign nationals. The IMC included Employment and Labor Minister Thulas Nxesi, Transport Minister Fikile Mbalula, Police Minister Bheki Cele and Home Affairs Minister Aaron Motsoaledi and was formed to deal with escalating road blockages and protests by disgruntled South African truck drivers. The action plan involves (1) facilitating the appointment of a task team, (2) enforcing visa requirements, (3) consideration of all foreign driving licenses, (4) registration and compliance with labor laws, and (5) registration of operators in terms of Section 45 of the National Road Traffic Act. Additionally, the plan also sets out (1) to review the traffic register number, (2) to review cross-border road transport legislation, (3) to amend the National Road Traffic Regulation, (4) to integrate joint multi-disciplinary law enforcement operations accompanied by a driver training program, and (5) consider the introduction of operating licenses for the industry. Furthermore, Police Minister Bheki Cele has reiterated that any company employing illegal immigrants will be severely punished as the South African workforce still needs protection despite the agreement on an eleven-point action plan to allow foreign employment.
iv. Developments at the Kasumbalesa border post
Conflicting reports have fueled confusion surrounding the latest developments at the Kasumbalesa border post as drivers’, and transporters’ version of the truth differs from the Zambian Revenue Authority’s (ZRA) version. However, on 10 June, it was announced that DRC & Zambia had agreed for Sakania & Mokambo to start operating on a 24-hour basis, while on 16 June, conflicting reports emerged that all trucks at Sakania were to be diverted back to Kasumbalesa by Ndola customs due to the border being closed. ZRA confirmed that the road was being refurbished and that drivers were asked to divert while the rerouting vehicles would not incur further costs.
However, in July, both governments of these neighboring countries showcased their determination to transform the border post into a more effective one-stop-border post which will essentially allow for higher volumes to be cleared and for the congestion to be alleviated. On 11 July, the government of the Democratic Republic of the Congo (DRC) demonstrated their high-level political will and commitment to ease border congestion by unveiling its plans for the one-stop-border-post. Likewise, the President of Zambia showed a willingness to reduce congestion and queue times at the border post by advising the Ministry of Commerce, Trade, and Industry to engage with all stakeholders involved to ensure that an effective solution is found to the challenge at hand. On average, the border post handles approximately 650 vehicles per day, while the target will increase to an average of 800 per day once desired outcomes are achieved during the one-stop-border-post negotiations.
v. Developments at the Chirundu border post
In partnership with the European Union (EU) and the Common Market for Eastern and Southern Africa (COMESA), the Government of Zambia has officially launched the 6.8 million Euros project to upgrade Zambian border posts. The Zambia Border Posts Upgrade Project (ZBPUP), whose implementation has been underway since the signing of the financing agreement in November 2020, aims to improve intra-regional trade flows of goods, persons, and services. It focuses on key interventions to improve Zambia’s trade facilitation profile. So far, considerable progress has been made in capacity building and sensitization at the three border posts, namely Mwami (Zambia/ Malawi), Chirundu (Zambia /Zimbabwe) and Nakonde (Zambia/Tanzania). The upgrade of the three One-Stop Border Posts (OSBP) aims to reduce clearance times and costs for passengers and the processing of goods. It will also aid in improving the efficiency of the services offered by border agencies, thereby increasing satisfaction among users of border facilities and revenue collection. Additionally, the project will improve skills and capacity among border agencies and the private sector through a series of capacity-building and sensitization activities on core trade facilitation issues. Furthermore, the ZBPUP will aid in reducing the number of reported Non-Tariff Barriers (NTBs) at the three targeted border posts.
vi. Developments at the Mokambo border post
In the second quarter of 2022, there is still an ongoing issue with the roads leading to the Mokambo border between DRC and Zambia. The poor infrastructure still causes many trucks to get stuck on their way to the border, negatively contributing to the congestion already experienced at the border post. As a result, in June, Zambian Authorities advertised the development of border infrastructure at Sakania Border, the Ndola to Mufulira Road (M4 Road), and the access road to Sakania Border Post. In addition, the Consortium intends to submit a Competing Proposal which includes the development of border infrastructure at the Mokambo Border and the Mufulira to Mokambo Road (M5) for strategic reasons. The rationale for the proposed inclusion is that if there is a technical glitch at Sakania Border, road freighters ought to have a nearby alternative exit or entry route. Therefore, the Concessionaire shall be responsible for the overall implementation of the proposed Competing Project, including but not limited to the investigation, study, engineering, procurement, construction, financing, operations, and maintenance of the project in line with the terms and conditions provided in the Concession Agreement. However, there are currently no indications of when these infrastructural developments will be completed.
As of 22 May 2022, almost one billion people in lower-income countries remain unvaccinated. Only 57 countries have vaccinated 70% of their population, primarily high-income countries. The WHO needs to ensure continued support to all nations to reach 70% vaccination coverage as soon as possible. The approach must include 100% of those aged over 60, 100% of health workers, and 100% of those with underlying conditions. Vaccine supply has improved, but absorption has not kept pace. In some countries, insufficient political commitment exists to roll out vaccines. This situation was impacted by the initial lack of political commitment to equitable vaccine access. In some, there are visible gaps in an operational or financial capacity. Essentially, vaccine hesitancy is driven by misinformation and disinformation. The WHO’s primary focus is to support countries to turn vaccines into vaccinations as quickly as possible. It is critical for the WHO to ensure fair and equitable access to vaccines and that every country receives them and can roll them out to protect their people, starting with the most vulnerable. The WHO have implemented the following strategies to ensure that effective vaccines are delivered safely:
- COVAX – COVAX aims to accelerate the development and manufacturing of COVID-19 vaccines and guarantee fair and equitable access for every country. COVAX is co-led by the Coalition for Epidemic Preparedness Innovations (CEPI), Gavi, and the WHO, with UNICEF as a critical delivery partner and PAHO as the procurement agent in the Americas.
- COVID-19 Vaccine Delivery Partnership – Recognizing the urgency of turning vaccine doses into vaccinated, protected communities, WHO, UNICEF and Gavi, the Vaccine Alliance launched the COVID-19 Vaccine Delivery Partnership (CoVDP). The Delivery Partnership builds on existing resources to support the AMC 92 and focuses on the 34 countries with or below 10% coverage in January 2022. Working closely with governments to understand bottlenecks to vaccination, the Delivery Partnership offers access to urgent operational funding, technical assistance, and political engagement to scale up vaccination and monitor progress towards targets rapidly.
- No-Fault Compensation program – COVAX No-Fault Compensation Program for Advance Market Commitment (AMC) Eligible Economies is the world’s first and only international vaccine injury compensation mechanism. The Program helps COVAX deliver safe and effective COVID-19 vaccines to high-risk and vulnerable populations in 92 low- and middle-income countries and economies.
On 12 July 2022, the twelfth meeting of the Emergency Committee convened by the WHO Director-General under the International Health Regulations (2005) (IHR) regarding the coronavirus disease (COVID-19) pandemic took place, and the following suggestions were made regarding international travel, transport, mass gatherings, and vaccinations:
- Member States should strengthen their response to the COVID-19 pandemic by updating national preparedness and response plans in line with the priorities and potential scenarios outlined in the 2022 WHO Strategic Preparedness, Readiness and Response Plan. In addition, state Parties should regularly conduct assessments to inform current and future response, readiness, and preparedness efforts, to ensure that future challenges are rapidly identified and managed, including with tools and approaches different from those adopted in the context of the current shape of the pandemic.
- Member States should address risk communications and community engagement challenges and the need to address divergent perceptions of risk between scientific communities, political leaders, and the public.
- Member States should aim to achieve national COVID-19 vaccination targets aligned to global WHO vaccination targets and the updated WHO SAGE Roadmap for prioritizing uses of COVID-19 vaccines. In addition, state parties should determine and close the vaccination gap among high-risk populations to achieve the highest possible vaccination coverage among persons at highest risk of severe disease outcomes and persons at highest risk of exposure, health workers, the elderly and other priority groups.
- Member States should continue to promote effective, individual-level protective measures to reduce transmission and viral evolution.
- Member States are encouraged to take a risk-based approach to mass gathering events by evaluating, mitigating, and communicating risks.
- Member States should adjust COVID-19 surveillance to focus on the burden of COVID-19 and its impact on health and public health services and prepare for sustainable integration with other surveillance systems.
- State Parties should enhance access to health, including through the restoration of health services at all levels and strengthening of social systems to cope with the impacts of the pandemic, especially on children, young adults, and individuals with Post COVID-19 conditions.
- Member States should continue adjusting international travel-related measures based on risk assessments and avoid placing a financial burden on international travelers.
In the new edition of Africa’s Development Dynamics 2022, policy recommendations are based on lessons learned and best practices from Central, East, North, West, and Southern Africa. The following section will point out how developing regional value chains can help African countries rebound from the socio-economic shocks of the pandemic and accelerate growth.
i. Developing regional value chains will support a sustainable recovery of their economic recovery
Strengthening African countries’ productive systems is vital to their economic recovery. The COVID-19 pandemic is pulling Africa backwards to “catching up” with the rest of the world. It is essential to consider that the health and economic crises mutually reinforce each other, so vaccination programs must accelerate. Unfortunately, most African countries have little fiscal space to offset some of the pandemic’s effects. Furthermore, production constraints limit African producers’ ability to benefit from the rebound in global demand. Accelerating productive transformation will create quality jobs, reduce poverty, and strengthen Africa’s economic resilience. In addition, building the capacity to manufacture pharmaceutical products and produce food locally can help support these countries’ vulnerability.
Rolling out the AfCFTA (African Continental Free Trade Agreement) can help develop these regional value chains and accelerate transformation. This agreement provides various new opportunities for better integration. Furthermore, regional value chains can help Africa become more integrated into global value chains and help facilitate transformation. Improved physical, social, and institutional resources within the trading environment could help develop production capabilities that enable businesses to access and retain more demanding markets. Also, strengthening regional production capabilities can improve backward participation in value chains and create more jobs.
ii. Policymakers must work with the private sector to develop regional production networks
Public-private alliances in the digital economy can help reduce the costs of regional production and trade. In addition, digital innovations within the supply chain environment increase the efficiency of logistics, customs, and finance. For example, distributed ledger technology (blockchains) allows for more efficient cross-border payments and trade finance by creating smart contracts. Public-private alliances are crucial to developing Internet infrastructure and providing accommodative regulations for cross-border data flows. Building the infrastructure to connect national digital markets can facilitate economies of scale, attract investment, and increase competitiveness.
Furthermore, national industrial policies must adapt to the new environment provided by the AfCFTA. Tailoring skills policies to technical needs and emerging trends are critical to attracting investment and increasing linkages with lead firms. Upskilling will be vital in meeting a new requirement for Africa’s digital and green transformation sector-specific needs. Further harmonizing domestic investment legislation could help reconcile the continent’s fragmented investment environment and boost intra-African investments by 14% compared to 2018. Finally, it is critical to note that Africa’s existing networks of industrial clusters provide a vital entry point for developing infrastructure and promoting further investment.
iii. Regional policies are essential for expanding regional production networks:
Rising intra-African trade costs impede regional production networks. According to the World Bank trade costs database, it has been estimated that trade costs throughout Africa have increased to 2007 levels, despite a considerable decline in intra-African tariffs. This increase harms production networks as it compounds every time the product crosses international borders. These costs relate to poor infrastructure, weak trade-related services, and non-tariff barriers.
Furthermore, policy support is critical for African firms to improve their competitiveness, create links in local economies, and overcome barriers to investment. Formal institutions such as political stability, macroeconomic stability, property rights, and intellectual property rights help businesses flourish. In addition, further consideration should be given to the risks borne from international production networks, which call for careful policy attention. Furthermore, African countries must address environmental challenges alongside development. Finally, better mobilizing domestic resources is vital to ensure policy implementation. For example, tax administration reforms are necessary at a national level to mobilize domestic resources and combat illicit financial flows.
As we summarize this report, the challenges faced by the East and Southern African countries have not diminished during the second quarter of 2022 and still threaten economic growth prospects in the region. The effects of the COVID-19 pandemic and the ongoing war in Ukraine are still far from over as economies in East and Southern Africa face the prospects of economic stagnation. The effects associated with the COVID-19 pandemic are highlighted by the lack of access to vaccines and critical life-saving tools in low-income countries predominant in Africa. A lack of COVID-19 vaccines in Africa is exclaimed because merely three African countries have managed to achieve the WHO-prescribed feat of vaccinating 70% of their population. Additionally, food security due to the war in Ukraine is mounting pressure on African economies and their recovery prospects. Therefore, East and Southern African countries should continue focusing on vaccine rollout campaigns to accelerate economic recovery and growth. Furthermore, regional policies allowing market integration and investment accompanied by solid leadership remain critical to ensure that economic performance is fully enhanced for the remainder of the year. Furthermore, it remains crucial for the public sector to collaborate with private sector representatives to build regional production networks and adjust to the trading environment created by the AfCFTA.
In terms of regional trade, cross-border flows are continuously experiencing the aftermath of the COVID-19 pandemic, as many land border posts are still experiencing severe congestion and queueing times. It is, therefore, essential that growth and investment are driven at the region’s commercial ports, roads, and border posts through infrastructural upgrades, logistical performance and the like. The African Continental Free Trade Area (AfCFTA) provides African countries with the perfect opportunity to recover from the COVID-19 pandemic and the Ukrainian war. Nevertheless, the emphasis is not lost on the importance of a collective approach to seize this opportunity. The responsibilities not only rest with one stakeholder but will require the collective input of all involved, including customs authorities, port authorities, the shipping lines, private transporters, OGAs, freight and clearing agents, and all other parties involved. Therefore, the RPSG collectively emphasizes the need for positive change in many areas in the region, including the uptake of the AEO program, trade digitalization (single windows and one-stop border posts), bond and transit guarantee, and regional transport systems. Currently, there are multiple projects at several border posts transforming a one-stop border post, proving that a section of the region is on the right track. Ultimately, we must harmonize and simplify trade to enable a better, compliant, safe, and secure trading environment.