Gross Domestic Product (GDP)

The African Sovereign Debt Justice Network brings to you an update of African sovereign debt news and updates on events and happenings on and about Africa that reveal how sovereign debt issues are engaged by the various stakeholders.

The disclosures on Kenya's sovereign debt indebtedness so far indicate that there could very well be examples of hidden debt - particularly sovereign debt that may not be publicly or dully disclosed particularly to Parliament.  This together with Kenya's increasing indebtedness means that Kenya's Parliament and civil society groups like the African Sovereign Debt Justice Network and OKOA Uchumi must carefully scrutinize as well as the 2021 National Debt Management Strategy Paper and all the accompanying disclosures. Kenya's Parliamentary Budget Office has recently noted that increased interest payments on debt have reduced spending on development and recommended rescheduling of domestic debt.

December 9, 2020

This blog reflects on an issue as current and complex as the control of the digital economy by the Tax Administrations (TAs). The topic is very important in Latin America and Caribbean because it is the most unequal region in the world with extreme poverty. The prevalence of informal economy in Latin America and Caribbean requires that controling the digital economy and combating tax evasion be a priority for the region.

Digital Economy and Taxation in Latin America

In this blog, I continue discussing the broad understanding of informality while briefly touching on informal enterprise. And I hope to, simultaneously, point out a couple of proposed solutions to challenges of the informal economy in Africa. My very strong suggestion, though, is that African countries should embrace informality as a reality on the continent.

Joining the WTO will reduce the diverse economy that the Ethiopian government has been fostering. But if the government feels that WTO membership is necessary, then Ethiopia must take it’s time to negotiate more favorable terms in line with its development status and objectives. In particular, Ethiopia should not make the same mistakes as other newly joined nations and should not agree to undertake higher levels of commitments than is made absolutely necessary by the WTO rules and what other founding LDCs, such as Bangladesh, have made. Specifically, Ethiopia should seek to ensure that tariffs are bound at the highest rates possible.

While the AfCFTA is most probably the next best thing in terms of economic benefits (for instance, huge trade volumes and larger financial flows) since states on the continent created the AU itself, it poses certain dangers. In particular, like SACU, the CCU envisaged in the AfCFTA Agreement will likely injure the economies of some of its member states. And, unless the AU delegates custom-design it carefully, bearing in mind the policy choices brought up in this piece and in older regional trade agreements, the CCU can prove prohibitively costly.

Intra Africa trade remains at its lowest ebb and perhaps this sad state of affairs can only be remedied by the actualization of the envisaged Africa Economic Community (AEC). To this extent RIAs, such as those under study in this paper, offer viable building blocks and learning curves for negotiating in the much larger multilateral trade system.