Latest news with #AfricanContinentalFreeTradeArea
IOL News
7 hours ago
- Business
- IOL News
Will South Africa's 2025 Employment Equity targets disrupt international trade?
Minister of Employment and Labour, Nomakhosazana Meth. Image: GCIS South Africa's newly gazetted sectoral employment equity targets could place the country in breach of several international trade agreements – including the World Trade Organization's General Agreement on Trade in Services (GATS), as well as regional protocols under the African Continental Free Trade Area (AfCFTA). This is according to Clive Vinti, Head of Research at XA Global Trade Advisors, who says the targets – set to come into effect from September 1 – appear to impose discriminatory limitations on who can be employed in specific sectors, without taking account of the realities of those sectors or the international obligations South Africa has signed up to. The potential trade implications formed part of the legal challenge launched by the National Employers' Association of South Africa (NEASA) and Sakeliga NPC against the Minister of Employment and Labour. The challenge, announced on July 9, was aimed at halting the implementation of the '2025 Targets' and the underlying regulations. Vinti argued that numerical quotas based on national race and gender demographics, if enforced without sector-specific capacity considerations, risk breaching international agreements that explicitly prohibit employment caps in service sectors. Under GATS, for example, member states are barred from placing quantitative limits on the number of people that can be employed in any given service sector. The same provisions are mirrored in AfCFTA and Southern African Development Community protocols, where the focus is on promoting access and non-discrimination in trade in services. In South Africa's case, these equity targets apply to both local and foreign-owned firms operating in the domestic economy. If implemented without regard for the availability of suitably qualified individuals in designated groups, they could act as a barrier to market access, especially for foreign service providers and investors, potentially triggering trade disputes or retaliatory measures. At the heart of the court application filed by NEASA and Sakeliga is the argument that the 2025 targets, which flow from the insertion of section 15A into the Employment Equity Act (EEA), were adopted in breach of procedural and constitutional requirements. The amendment, which came into effect on 1 January 2025, grants the Minister of Employment and Labour, Nomakhosazana Meth, the power to set sector-specific numerical employment targets in order to ensure equitable representation at all occupational levels. But the law also requires that such targets be preceded by a public consultation process and that affected sectors be properly identified and engaged. Video Player is loading. Play Video Play Unmute Current Time 0:00 / Duration -:- Loaded : 0% Stream Type LIVE Seek to live, currently behind live LIVE Remaining Time - 0:00 This is a modal window. Beginning of dialog window. Escape will cancel and close the window. Text Color White Black Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Background Color Black White Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Transparent Window Color Black White Red Green Blue Yellow Magenta Cyan Transparency Transparent Semi-Transparent Opaque Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Dropshadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps Reset restore all settings to the default values Done Close Modal Dialog End of dialog window. Advertisement Next Stay Close ✕ Ad loading According to the applicants, this did not occur. They allege that instead of the minimum 30-day comment period stipulated in the Act, they were given just over a week to respond. Furthermore, while draft targets had been published for public input in 2023 and 2024, this step was skipped entirely for the 2025 targets. NEASA and Sakeliga also argued that the consultation process was neither meaningful nor inclusive. Some sessions were limited to 1 000 virtual attendees and held with little to no advance notice. Employers were allegedly only given access to the proposed targets during or shortly before these meetings. Compounding the procedural issues, the applicants say the Minister used a 'one-size-fits-all' approach in determining the targets – applying blanket increases of 6% to 9% across occupational levels, without regard for each sector's structure, skills availability, growth trajectory, or economic context. This, they argue, rendered the targets arbitrary, irrational and potentially unachievable. The challenge also raised concerns around the impact on women. While women are themselves a designated group under the EEA, the structure of the targets could, paradoxically, disadvantage them by failing to account for intra-group disparities. Crucially, the plaintiffs said that no socio-economic impact assessment had been conducted before gazetting the targets. In their view, this omission made the regulations irrational and placed the policy in conflict with section 9 of the Constitution, which deals with the right to equality and non-discrimination. Beyond constitutional and procedural issues, the applicants highlighted the direct risk to businesses. Companies that fail to meet the new equity targets face penalties of up to R1.5 million or 2% of annual turnover on first offence. Section 53 of the EEA, which is not yet in force, could eventually see non-compliant firms excluded from government procurement processes entirely, with existing state contracts cancelled. 'Since the government is the largest procurer of goods and services in the market, being blocked from trading with it could be fatal to a business,' said Vinti. The equity targets could also affect access to key trade instruments. Duty rebate, increase and reduction applications, often used to support or protect domestic industries, require compliance with labour legislation. Non-compliance may disqualify firms from benefiting from these instruments, weakening their competitiveness both locally and abroad. According to Vinti, these developments have the potential to upend South Africa's trade credibility. The matter is now before the courts, with NEASA and Sakeliga seeking an urgent interim interdict to halt the targets' implementation while the High Court considers the lawfulness and constitutionality of the regulations. 'The ball is now in the court of the Minister,' said Vinti. IOL
Al-Ahram Weekly
a day ago
- Business
- Al-Ahram Weekly
Nigeria officially backs Egypt's Khaled El-Anany for UNESCO Chief at Abuja Business Forum - Foreign Affairs
Nigeria has officially endorsed Egypt's candidate, Dr Khaled El-Anany, for the post of Director-General of UNESCO ahead of the election scheduled for October 2025. Nigerian Foreign Minister Yusuf Tuggar made the announcement during the opening session of the Egypt-Nigeria Business Forum in Abuja on Monday. The forum was attended by Egypt's Foreign Minister, Badr Abdelatty—currently on a West Africa tour—Dr El-Anany, and a high-level delegation of representatives from major Egyptian and Nigerian companies, business chambers, and economic organizations. In his keynote address, Tuggar expressed Nigeria's full support for El-Anany's candidacy and extended his best wishes for a successful election. He also reaffirmed Nigeria's commitment to strengthening bilateral ties with Egypt, highlighting major opportunities for enhanced trade, investment, and economic cooperation. For his part, Abdelatty underscored the strategic importance Egypt places on its relationship with Nigeria, calling it one of the country's most vital partners on the continent. He noted that the forum provides a key platform for fostering private-sector partnerships and exploring joint investment opportunities across various sectors. Abdelatty emphasized the need to fully utilize the African Continental Free Trade Area (AfCFTA) to expand cooperation, particularly in agriculture, pharmaceuticals, mining, and manufacturing. He also highlighted Egypt's efforts to develop its investment environment and infrastructure, and expand its industrial base into sectors such as electronics, construction materials, food processing, and pharmaceuticals—citing their high quality and competitive pricing. The minister pointed to Egypt's ongoing national mega-projects and the country's vast market potential, affirming the government's readiness to support deeper economic cooperation with Nigeria. He also referenced the longstanding political and historical ties between the two nations. Abdelatty concluded by urging joint action to eliminate barriers to economic collaboration and reiterated Egypt's full commitment to supporting investors and businesses from both sides. He expressed confidence that Nigeria would provide the necessary facilitation to maximize mutual benefits. Follow us on: Facebook Instagram Whatsapp Short link:
The Citizen
a day ago
- Business
- The Citizen
Can SMEs survive Trump tariffs? Here is what small businesses can expect from July
There is still hope that the government trade negotiation teams will be able to strike a deal before the 30% tariffs come into effect. It is about to be a bumpy road for small and medium enterprises (SMEs) in South Africa from July due to the 30% United States (US) import tariffs, hikes in electricity and petrol prices and the uncertainty surrounding the interest rate announcement coming on 30 July 2025. Miguel da Silva, group executive for Business Banking at TymeBank, says it is essential for SMEs to prepare for the impact of a 30% US import tariff, which is set to take effect on 1 August 2025. The impact of tariffs on SMEs Da Silva adds that the tariff hike is bad news for businesses that currently export to the US, especially those involved in the agricultural, automotive, and mining sectors. 'The tariff increases will also have repercussions for the broader economy, with commentators saying the move could lead to thousands of job losses across the affected sectors.' He says there is still hope that the government trade negotiation teams will be able to strike a deal before the 30% tariffs come into effect. In the meantime, President Cyril Ramaphosa has called on South African companies to accelerate their search for alternative markets in order to promote better resilience in both global supply chains and the South African economy. ALSO READ: SMEs need to brace for reduced orders due to a 30% US tariff New export markets for SMEs Da Silva says exporters have been seeking out new markets, taking advantage of trade agreements such as the African Continental Free Trade Area (AfCFTA) to strengthen intra-African commerce and lessen reliance on the US. 'The Brics+ bloc also presents an opportunity for local exporters to tap into major markets like China, Southeast Asia, Saudi Arabia, and the UAE. 'Already, China has announced a decision to eliminate all tariffs on imports from the 53 African countries, including South Africa, which is welcome news for SMEs looking for new markets.' Electricity and petrol price increases He highlighted that electricity and petrol price increases add to SMEs' woes, but on the bright side, inflation appears to be under control. 'The US tariff blow comes at a time when South African SMEs are already facing margin squeeze because of additional cost pressures from energy price hikes and fuel price increases, all of which threaten not only their short-term profitability but also their long-term sustainability and competitiveness.' According to the Bureau of Economic Research's (BER) latest survey, inflation expectations have fallen to their lowest in four years. 'Respondents expect inflation to be below 4% this year, echoing the view of Reserve Bank governor Lesetja Kganyago.' ALSO READ: Mid-year financial check for SMEs: Tips to prepare for the next six months Unemployment remains a concern He has noted that there is modest growth and mixed expectations around interest rates, while unemployment remains a concern. 'GDP data for Q2 2025typically arrives on 25 July. The recent modest growth of 0.4% quarter-on-quarter suggests continued economic challenges, making this release vital for demand forecasting and timing market expansion. 'Expectations about the outcome of the 31 July South African Reserve Bank's (SARB) Monetary Policy Committee (MPC) meeting, scheduled for 31 July 2025, are mixed.' Interest rates to hold Da Silva highlighted that most analysts believe interest rates will remain unchanged, while a few still see a possibility of a 25-basis-point cut. 'We hope the SARB decides to put growth above inflation control this time. In principle, lower interest rates mean more disposable income for consumers, which should ultimately result in increased spending and demand for goods and services from SMEs.' He emphasised that there is an increased collaboration between the private sector, government, and financial institutions to foster funding and investment opportunities for SMEs. 'This may include government initiatives, revamped credit guarantee schemes, and partnerships with fintech companies.' NOW READ: Here is how SMEs can take advantage of the G20 and B20 summits
IOL News
a day ago
- Business
- IOL News
South African SMEs brace for impact as Trump tariffs loom
With the looming threat of US tariffs on South African exports, SMEs face an uncertain future. Explore the ripple effects of these economic changes and how businesses are adapting to survive in the July 2025 TymeBank SME Outlook. Image: Supplied South African small and medium enterprises (SMEs) stand at a critical crossroads, grappling with the looming spectre of a 30% import tariff on most goods entering the United States. This decision, signed into effect by President Donald Trump, will come into play on 1 August 2025, raising alarm bells for several sectors, particularly agriculture, automotive, and mining, industries heavily reliant on exports to the US market. The consequences of these tariffs threaten to reverberate throughout the broader economy, with experts warning of potential job losses in the thousands. Miguel da Silva, Group Executive of Business Banking at TymeBank, pointed to the tariff implications as not just an isolated issue but rather a reflection of the shifting geopolitical landscape that South Africa must navigate. 'As a nation, we have to rethink our trade strategies in light of these developments,' da Silva said. In response to these challenges, President Cyril Ramaphosa has urged South African companies to expedite their search for alternative export markets, highlighting the urgent need to bolster resilience in global supply chains and support the local economy. Video Player is loading. Play Video Play Unmute Current Time 0:00 / Duration -:- Loaded : 0% Stream Type LIVE Seek to live, currently behind live LIVE Remaining Time - 0:00 This is a modal window. Beginning of dialog window. Escape will cancel and close the window. Text Color White Black Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Background Color Black White Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Transparent Window Color Black White Red Green Blue Yellow Magenta Cyan Transparency Transparent Semi-Transparent Opaque Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Dropshadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps Reset restore all settings to the default values Done Close Modal Dialog End of dialog window. Advertisement Next Stay Close ✕ Some exporters have already begun seeking new opportunities, turning towards the African Continental Free Trade Area (AfCFTA) to boost intra-African commerce. This strategic pivot could lessen dependence on the US market amid increasingly unfriendly trade conditions. The BRICS+ bloc also provides fertile ground for growth, granting access to substantial markets such as China, Southeast Asia, Saudi Arabia, and the UAE. Encouragingly, China recently announced it would eliminate all tariffs on imports from 53 African nations, including South Africa, presenting a timely opportunity for local SMEs to expand their footprint. However, as exporters look towards new horizons, they must also confront domestic obstacles. Energy and petrol price hikes have compounded the financial challenges for SMEs already facing margin pressures. These increases put further strain on already thin profit margins, raising concerns about the long-term sustainability of many businesses. Yet, on a positive note, inflation expectations are reportedly at their lowest in four years, with predictions of rates falling below 4% this year, a significant consideration for businesses with an eye on cost control. The economic landscape remains complex, with mixed expectations surrounding interest rates ahead of the South African Reserve Bank (SARB) Monetary Policy Committee meeting scheduled for 31 July 2025. While the prevailing sentiment points towards maintaining the current interest rate, some analysts speculate on a modest cut. A reduction could inject disposable income into consumers' pockets, providing a much-needed boost for SMEs struggling with stagnant demand. Despite the headwinds, the outlook for funding appears more optimistic. There is an emerging expectation of stronger collaboration between the private sector, government, and financial institutions aimed at creating more avenues for SME financing. Initiatives such as revamped credit guarantee schemes and partnerships with fintech companies are anticipated to ease access to funds for smaller enterprises. However, challenges remain, particularly for those with limited operational histories or lower turnover rates. As South Africa prepares to face a transformed export landscape shaped by new tariffs and economic pressures, SMEs find themselves in a precarious position. With strategic pivots and adaptive measures, these businesses may yet navigate through turbulent times, emerging more resilient in the face of uncertainty. BUSINESS REPORT
Libya Review
3 days ago
- Business
- Libya Review
Egyptian Investments in Libya Surpass $2.5 Billion
Egyptian companies are currently executing infrastructure and development projects in Libya worth over $5 billion, according to Ahmed El-Wakil, President of the Federation of Egyptian Chambers of Commerce. Speaking at the 4th Egypt-Libya Business Forum held in Alexandria under the slogan 'Egypt and Libya Towards Integrated Sustainable Development,' El-Wakil noted that these ventures span key sectors such as road construction, including the ring road, power stations, and housing developments. Egyptian Investment in Libya Surges El-Wakil revealed that Egypt's direct investments in Libya have surpassed $2.5 billion for the first time, now exceeding Libyan investments in Egypt—signaling a significant shift in the bilateral economic landscape. However, he also noted a 25% decline in the number of Libyan companies operating in Egypt, with the figure falling to 511 firms. These companies have a declared capital of $4 billion and effective contributions of $2.4 billion. El-Wakil urged the reactivation of the Shidda Libya Investment Authority, citing its past pivotal role in supporting economic cooperation. New Joint Ventures Targeting Africa Calling for a move beyond traditional bilateral ties, El-Wakil advocated for a new phase of joint economic action aimed at penetrating African markets, aligning with the mutual interests of both nations. He emphasized the strategic benefits of the African Continental Free Trade Area (AfCFTA), which opens access to a market bloc valued at over $1.4 trillion. Logistics Hub at Salloum Border and Regional Infrastructure Plans On the logistics front, Egypt has completed technical studies to establish a global logistics hub near the Salloum border crossing, which would boost trade with Libya and improve access to West African markets. He also highlighted the strategic importance of the Mediterranean coastal highway stretching from Port Said to Casablanca, and proposed accelerating the construction of a transcontinental trade route connecting southern Egypt, southern Libya, Chad, and Dakar, enhancing links between the Mediterranean Sea and Atlantic Ocean. Private Sector Role in Libya's Reconstruction El-Wakil called for aligning Egyptian technical capabilities with Libyan capital to take advantage of business opportunities across the African continent, especially for young entrepreneurs. He affirmed that the private sector—supported by both governments—is well-positioned to lead Libya's post-conflict reconstruction, especially in transportation, logistics, ports, infrastructure, and energy. Highlighting Egypt's success in national power development and regional interconnection, El-Wakil stressed its potential as a foundation for future cooperation. He also pointed to promising joint ventures in manufacturing, particularly in building materials, metallurgy, and food industries—where Egypt holds strong technological and industrial advantages. The forum reflects ongoing efforts to expand economic cooperation between Cairo and Tripoli, with the private sector playing a key role in driving sustainable development and rebuilding efforts. Tags: AfCFTAEgyptlibyaNorth AfricaTrade
