By Eric Knecht and Maha El Dahan

CAIRO/ABU DHABI (Reuters) – Egypt said it plans to build a six month reserve of essential food items, adding to other recent purchases of commodities such as oil and wheat, in what traders said was a move to build up stocks ahead of a currency devaluation.

Prime Minister Sherif Ismail said late on Tuesday the country would look to import 500,000 tonnes of rice and 400,000 tonnes of sugar to boost reserves and keep prices in the domestic market down.

The statement came after state grain buyer GASC announced three separate tenders in the space of one day for wheat, vegetable oils and sugar.

“I would definitely say that the current plan does appear to be stocking up on imported stocks before a devaluation. We’re seeing this happening in sugar, rice, beans, and the current campaign in wheat,” one Cairo-based commodities trader said, echoing several others who spoke to Reuters.

GASC declined to comment on the issue.

Egypt, the world’s largest wheat importer, operates a massive food subsidy programme to sell essential items to the country’s poorest citizens.

“We’ve received numerous inquiries from different government agencies – some military as well – and they seem quite eager to get their hands on commodities,” the trader said.

Pressure has been mounting on Egypt’s central bank to devalue its currency as the country contends with an acute dollar shortage brought on by the flight of tourists and foreign investors, major sources of hard currency that fled after the 2011 uprising.

Speculation is rife that the bank could devalue the pound in coming days to close a widening gap with the black market rate, which has ticked up to more than 14 pounds to the dollar in recent days compared with the official rate of 8.8 pounds.

Essential commodities purchased by the government are among the few items that receive dollar allocations at the official rate, with the vast majority of importers forced to resort to the more expensive black market.

The additional imports are part of an “urgent plan to guarantee the stability of strategic stocks of essential food items and ensure there is at least six months in stock at all times,” a cabinet statement said.

While some traders saw the recent uptick in government tenders as proof of an impending devaluation, others said the government’s campaign may be too late, with goods likely to arrive in Egypt after a possible rate cut or currency flotation.

“Unfortunately stocks are only built with executed contracts and not with confirmed ones,” another Cairo-based trader said.

The dash to fill stocks comes as prices have been climbing on commodities such as sugar and rice in recent weeks, partly due to shortages in the domestic market, traders told Reuters.

Sugar is trading locally at almost double its price from two months ago and quantities available to the private sector have been severely limited, one trader said.

(Reporting by Eric Knecht and Maha El Dahan. Editing by Jane Merriman and Louise Heavens)

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By Tom Miles

GENEVA (Reuters) – Governments have a massive opportunity to boost national trade if they think strategically about how standards and regulations help or hinder SMEs to export, the Geneva-based International Trade Centre (ITC) said in a report published on Thursday.

“If you want to maximise your chances of getting your share of international trade, you need to be very strategic about where is the potential that you are not tapping into,” the ITC’s Executive Director Arancha Gonzalez told Reuters.

“The government has a possibility to open the door for businesses to follow, rather than the government following the regulatory framework of businesses that are trying to swim in this current by themselves.”

The ITC, a joint agency of the United Nations and the World Trade Organization that helps SMEs to trade, says its 300-page report, “Meeting the standard for trade”, offers a guide for small businesses and an action plan for governments.

Standards and regulations are key to competitiveness and one of the defining elements of trade in the 21st century, Gonzalez said, as consumers become more and more savvy and picky about where products come from and what they contain.

“Consumers are asking for more sophisticated standards. This is a huge challenge for SMEs, for governments, and for institutions. The option of no standards or lower standards is not an option,” Gonzalez said.

Standards are diverse. They determine whether a plug fits into a socket, whether a medicine can be sold, and whether we can understand foreign traffic signs. Regulations can mean safety rules for food or cars, or privacy rules for data storage. In all cases governments need to back the rules up with testing and certification.

The report identifies areas where countries are underperforming their export potential, which standards and regulations they should target to meet that potential, and what investments are needed.

There is an opportunity for trade in processed and fresh food within the Middle East and North Africa, for example, where the number of technical regulations for fresh food imports is four times higher than in other regions, Gonzalez said.

“There is no internal trade because the manner in which they are regulating is hugely burdensome. So they don’t trade with each other, they only trade with the rest of the world.”

Countries in the region could increase food exports to each other by $7.6 billion and to developing countries in Asia by $16.5 billion, the report said.

The Asia-Pacific region could export $400 billion more in IT and consumer electronics, and $1.7 trillion more overall, and had strong potential to diversify into chemicals exports, the report said.

Meeting standards can open markets and raise prices, but Gonzalez said governments should “craft” regulation with SMEs in mind, since smaller firms make up 98 percent of businesses and their ability to trade suffers disproportionately from red tape.

“A 10 percent increase in the regulatory burden means 1.6 percent less trade for large companies but 3.2 percent less trade for SMEs,” she said.

(Reporting by Tom Miles; Editing by Toby Chopra)

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HARARE (Reuters) – Zimbabwe is losing at least $1 billion annually to corruption, with police and local government officials among the worst offenders, Transparency International said in a report on Tuesday.

Social media groups like #ThisFlag and #Tajamuka have cited corruption in President Robert Mugabe’s government and police roadblocks where money is taken from motorists as among the main reasons for protests that have rocked the southern African nation in the last few months.

Transparency International Zimbabwe (TIZ) said the police, local councils, the vehicle inspection department that issues driving licences and the education department were among the most corrupt institutions.

“The resulting institutionalisation and systematisation of corruption in Zimbabwean political and economic spheres has been extensive,” TIZ said.

“It would be surprising if the value (of corruption) were less than $1 billion annually.”

Police spokeswoman Charity Charamba said she could not immediately comment.

Critics and the opposition accuse Mugabe of failing to tackle high-level graft and say endemic corruption is one reason foreign companies are hesitant to invest in the country.

Mugabe has at times admitted to corruption among his cabinet ministers but says police lack the evidence to prosecute.

“It could be true there could be corruption but we don’t have people who are prepared to give evidence,” Information Minister Christopher Mushohwe said in response to questions about the report.

“Give us the evidence and the law will take its course.”

Zimbabwe was last year ranked 150th out of 168 countries on the Transparency International index, which measures public perceptions of corruption in public institutions.

Corruption mainly consists of public officials demanding bribes for basic services like installing an electricity metre, approving a house plan to facilitating investment.

Zimbabwe’s tax authority in May suspended its head and five managers in connection with the purchase of luxury cars that were undervalued by a local dealer, one of few high-ranking graft cases to be made public in recent years.

(Reporting by MacDonald Dzirutwe; Editing by Joe Brock and Hugh Lawson)

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