nep-afr New Economics Papers
on Africa
Issue of 2024‒01‒29
four papers chosen by
Sam Sarpong, Xiamen University Malaysia Campus

  1. Prospects for LNG and Hydrogen Export from Sub-Saharan Africa to the EU By Kohnert, Dirk
  2. Exploring options to deepen and broaden the personal income tax base in South Africa By Gemma Wright; Katrin Gasior; Joonas Ollonqvist; Wynnona Steyn; Winile Ngobeni; Helen Barnes; Michael Noble; David McLennan; Jukka Pirttilä; Ada Jansen
  3. Low-cost Chinese goods in Tanzania: the rise of transnational trade routes’ peripheral branches By Sylvain Racaud
  4. Does Urbanization Cause Crime? Evidence from Rural-Urban Migration in South Africa By Nelly Exbrayat; Victor Stephane

  1. By: Kohnert, Dirk
    Abstract: Since Russia's war in Ukraine, many European countries have been scrambling to find alternative energy sources. One of the answers was to increase imports of liquefied natural gas (LNG). By bypassing the use of pipelines from the East and by building LNG terminals, the EU opened up a wider variety of potential suppliers. The Europe-Africa Energy and Climate Partnership provides a framework for a win-win alliance. African countries will be key players in the future, including sub-Saharan countries such as Nigeria, Senegal, Mozambique and Angola. According to the REPowerEU plan, hydrogen partnerships in Africa will enable the import of 10 million tons of hydrogen by 2030, replacing about 18 billion cubic meters of imported Russian gas. Algeria, Niger and Nigeria recently agreed to build a 4, 128-kilometer trans-Saharan gas pipeline that would run through the three countries to Europe. Once completed, the pipeline will transport 30 billion cubic meters of gas per year. The African Coalition for Trade and Investment (ACTING) estimates potential sub-Saharan LNG export capacity at 134 million tonnes of LNG (approximately 175 billion m3) by 2030. Sub-Saharan Africa is also expected to become the main producer of green hydrogen by 2050. However, this market remains to be developed and requires significant expansion of renewable production and water availability. However, the EU countries and companies involved would be well advised to take note of the adoption of much stricter EU greenhouse gas reduction targets for 2030 and the publication of the European Commission's methane strategy. That being said, the EU could risk having more than half of Europe's LNG infrastructure idle by 2030, as European LNG capacity in 2030 exceeds total forecast gas demand, including LNG and pipeline gas. Regardless, it should not be forgotten that African countries want and need to develop their domestic gas markets as a priority, and that export potential depends on this domestic development. However, LNG alone is not enough to ensure the resilience of the system in the event of a supply failure. Alternative energy sources and energy conservation remain essential.
    Keywords: LNG; Hydrogen economy; e-fuels; LNG terminals; Natural gas; Energy security; Gas storage; Sub-Saharan Africa; EU; REPowerEU; Trans-Saharan gas pipeline; emerging markets; Sonatrach; European Green Deal; African Continental Free Trade Agreement; Eni; TotalEnergies; BP; Nigeria; Angola; Mozambique; Tanzania; Senegal; Cameroon; Equatorial Guinea; Namibia; African Studies;
    JEL: E22 E23 F13 F18 F23 F35 F54 L71 L95 N57 N77 O13 Q35 Z13
    Date: 2023–12–09
  2. By: Gemma Wright; Katrin Gasior; Joonas Ollonqvist; Wynnona Steyn; Winile Ngobeni; Helen Barnes; Michael Noble; David McLennan; Jukka Pirttilä; Ada Jansen
    Abstract: In this paper we explore options for augmenting South Africa's personal income tax revenue using two microsimulation models: PITMOD simulates the personal income tax system and is underpinned by a dataset comprising a full extract of anonymized individual-level administrative tax data; and SAMOD simulates personal income tax and social benefits using a nationally representative survey. We explore policy reforms at both the upper and lower ends of the income distribution of tax-registered individuals and assess the impacts on revenue and measures of progressivity.
    Keywords: Microsimulation, Personal income tax, Income distribution, South Africa
    Date: 2023
  3. By: Sylvain Racaud (LAM - Les Afriques dans le monde - IEP Bordeaux - Sciences Po Bordeaux - Institut d'études politiques de Bordeaux - IRD - Institut de Recherche pour le Développement - Institut d'Études Politiques [IEP] - Bordeaux - UBM - Université Bordeaux Montaigne - CNRS - Centre National de la Recherche Scientifique)
    Abstract: This article illustrates how rural margins and urban-rural relations in southwest Tanzania join up with transnational trade routes for Chinese goods. It examines the trade in low-cost imported goods from China (plastic sandals, cheap jewellery, various fashion accessories, cheap clothing, etc.) that are widely spread in Tanzania up to peripheral countryside. Through the concept of trade route, it contributes to the literature on urban-rural relations in African studies and on "inconspicuous globalisation" by first proposing a reverse perspective, with rural areas viewed as consumption areas of imported products. It then rescales the globalisation analysis by putting urban-rural relations at the heart of local and global interconnections. The article demonstrates that geographically peripheral places and actors, have a real capacity to influence the direction of the global trade route as they combine complementarities between the urban-rural continuum and the topological continuity of networks from local to global. The global trade geography is profoundly influenced by what goes on in its inconspicuous tentacles in upcountry regions such as the Uporoto mountains, where the global trade route relies on the dynamism of local agriculture, the latter increasingly merged with other livelihoods. This is exemplified by the complementarities between trade and agriculture in terms of livelihood, circulation of capital, urban-rural mobility, and links with global scales, which highlight the de-agrarianisation process and the development of a mass consumption society.
    Abstract: Cet article illustre comment des marges rurales et des relations rural-urbain en Tanzanie s'intègrent aux routes transnationales de produits chinois. Il analyse le commerce de produits bon marché importés de Chine (sandales en plastique, bijoux fantaisie, accessoires de mode, vêtements bon marché, etc.) largement accessibles en Tanzanie, jusqu'aux périphéries rurales. A partir du concept de route marchande, l'article contribue au champ des ‘mondialisations discrètes' et à la littérature sur les relations rural-urbain en études africaines en proposant une perspective inversée, où les espaces ruraux sont appréhendés comme des espaces de consommation d'objets importés. Il envisage l'analyse de la globalisation en situant les relations rural-urbain à l'interface du local et de connexions globales. L'article montre que des lieux et des acteurs géographiquement périphériques ont le pouvoir d'influencer la direction de routes marchandes globales en combinant des complémentarités du continuum urbain-rural et la continuité topologique du réseau, du local au global. La route marchande globale est profondément marquée par ce qui se passe dans ses ramifications discrètes telles les montagnes Uporoto, où la route globale s'appuie sur le dynamisme de l'agriculture locale, laquelle est de plus en plus combinée avec d'autres activités. Cela se traduit par des complémentarités entre le commerce et l'agriculture en matière de moyens d'existence, de circulation du capital, de mobilités rural-urbain et de liens avec d'autres échelles. Cela souligne la désagrarianisation et le développement d'une société de consommation de masse.
    Keywords: trade route, Chinese goods, urban-rural links, rural markets, network, mobility, Tanzania
    Date: 2022
  4. By: Nelly Exbrayat (Université Jean Monnet Saint-Etienne, CNRS, Université Lyon 2, GATE Lyon Saint-Etienne UMR 5824, F-42023, Saint-Etienne, France); Victor Stephane (Université Jean Monnet Saint-Etienne, CNRS, Université Lyon 2, GATE Lyon Saint-Etienne UMR 5824, F-42023, Saint-Etienne, France)
    Abstract: We study the impact of urbanization driven by internal migration on crime in South Africa. We create a new dataset that combines yearly data on crime and urban population density at the municipality level from 2011 to 2018. We exploit exogenous variations in rural-urban migration induced by climate shocks at origin for identification. We show that higher urban population density leads to a reduction in pecuniary crime rate but has no effect on non-pecuniary crime rate. We highlight two mechanisms explaining this negative effect: a change in population composition and a social network effect.
    Keywords: Crime; Migration; South Africa; Urbanization
    JEL: O18 R23
    Date: 2024

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