SOUTH AFRICA: Foreign Min-SA Strengthening Asia & MENA Relations Amid US Tariffs
Reuters reports comments from Minister of International Relations and Cooperation Ronald Lamola saying that "US reciprocal tariffs effectively nullify preferences that sub-Saharan African countries enjoy under the African Growth and Opportunity Act (AGOA)," claiming that the levies will hit agriculture, autos, and other sectors. Says that as a result, the South African gov't "is strengthening relations with countries in Asia and the Middle East to open new market access opportunities." Lamola is speaking alongside Trade, Industry and Competition Minister Parks Tau regarding the gov'ts approach to tariffs. Livestream here.
- Relations between the South African gov't and the US were already at multi-year lows prior to Donald Trump's return to the White House after then-US Ambassador to South Africa Reuben Brigety in 2023 accused the South African gov't of supplying arms to Russia. Since Trump's inauguration, the relationship has gone from bad to worse amid the suspension of US aid to South Africa due to "unjust racial discrimination" against white Afrikaners, and the subsequent expulsion of the South African ambassador.
- In recent years, South Africa has increasingly fostered economic and political links with other BRICS members, notably China. South Africa has engaged in joint naval drills alongside Chinese and Russian vessels, while in Feb, Chinese FM Wang Yi described China as a "trustworthy and reliable friend" to South Africa, in stark contrast to the US.
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EU: Euronews-Ukraine Aid Back In Draft EUCO Conclusions
Ahead of the special European Council summit taking place on Thursday 6 March, Jorge Liboreiro at Euronews posts on X: "EUCO latest: The Kaja Kallas plan is back in the draft conclusions, after being removed. “The European Council calls on the Council to advance work swiftly on initiatives, notably that of the High Representative, to coordinate increased EU military support to Ukraine"." Previous reports had suggested that the EUR20B package of emergency aid for Ukraine had been left out of the draft conclusions due to objections from Hungarian PM Viktor Orbán.
- Comes after Rikard Jozwiak at RFE/RL reported on 3 March that "one more line has now been added in the last EU summit draft: - peace must respect Ukraine’s independence, sovereignty and territorial integrity.", adding this morning "at the moment it looks like Hungary might opt out of the Ukraine part of the EU summit (6 March) conclusions".
- It remains to be seen what stance Hungary will take; whether Orbán sides with the rest of the EU or follows the precedent set in late 2023. During that EUCO, Orbán left the room 'for a coffee' at the suggestion of German Chancellor Olaf Scholz, allowing for a unanimous vote within the Council.
- In the wake of US President Donald Trump's pause on military aid to Ukraine, the EU's provision of a EUR20B package is seen as an important signal to Kyiv (and Moscow) of Brussels' intention to maintain its posture vis-a-vis the war.
MNI: UK FINAL FEB SERVICES PMI 51.0 (FLASH: 51.1); JAN 50.8
- MNI: UK FINAL FEB SERVICES PMI 51.0 (FLASH: 51.1); JAN 50.8
- MNI: UK FINAL FEB COMPOSITE PMI 50.5 (FLASH: 50.5); JAN 50.6
GILTS: /SWAPS: Spreads tYghten Alongside German Peers
Global swap spread correlations evident this morning, with the long end leading the narrowing in the UK, driven by the proposed fiscal expansion in Germany.
- Note that spreads fail to test respective cycle bases and have edged away from session lows.
