Major International Business Headlines Brief::: 29 January 2018

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Major International Business Headlines Brief::: 29 January 2018

 


 

 


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*  Zimbabwe sees economic growth of up to 6 pct in 2018-state newspaper

*  South Africa's Eskom to publish financial results on Tuesday

*  Anglo American sells Eskom-tied coal assets for $71 million

*  Opel to export cars to Tunisia, Morocco - CEO in FAZ

*  Egypt to halt imports of LNG by end of FY 2017/18 - minister of petroleum

*  IFC extends $62 million loan to South Africa's Mercantile Bank

*  Petra Diamonds warns on profit, cuts output view; shares slump

*  Kenyan shilling strengthens slightly on offshore demand

*  South Africa's rand slightly weaker, stocks set to open flat

*  Coincheck promises 46bn yen refund after cryptocurrency theft

*  New York investigates company accused of selling fake Twitter followers

*  Are President Trump's tax cuts helping workers?

*  Donald Trump came to Davos with a mission to reassure

*  China's eight-year-long smartphone growth comes to an end

*  US economy loses steam as imports surge

*   

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 


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Zimbabwe sees economic growth of up to 6 pct in 2018-state newspaper

HARARE (Reuters) - Zimbabwe’s economy could grow by up to 6 percent this
year, more than an initial forecast of 4.5 percent, due to the reforms being
pursued by President Emmerson Mnangagwa’s government, the finance minister
told a state-owned newspaper.

 

Mnangagwa, who came to power in November after a de facto military coup that
removed long-time leader Robert Mugabe, has promised economic reforms to
attract foreign investment and restore ties with international lenders so
the country can access fresh funding.

 

Finance Minister Patrick Chinamasa said the government would be bold in
reforming loss making state-owned companies and the mining sector, which
generates the highest export earnings.

 

“I think that 4.5 percent (growth) projection may well be conservative,”
Chinamasa told the government-owned Herald newspaper in an interview at the
World Economic Forum in Davos.

 

“I will not be surprised if we end up, towards the end of the year, all
things being equal, at around 6 percent growth.”

 

International Monetary Fund chief Christine Lagarde on Thursday welcomed a
commitment by Mnangagwa to stabilise Zimbabwe’s economy and work to improve
relations with the international community.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 


 <mailto:info at bulls.co.zw> 

 


 

 

South Africa's Eskom to publish financial results on Tuesday

JOHANNESBURG (Reuters) - South African utility Eskom will publish interim
financial results on Tuesday, the company said, in time to meet a Jan. 31
deadline set by the Johannesburg Stock Exchange, which had threatened to
suspend trading in Eskom’s bonds.

 

Eskom is the sole power supplier in Africa’s most industrialised economy and
delayed publication of its results late last year. The firm has been
embroiled in a governance crisis and has been at the heart of allegations of
undue influence in awarding tenders during President Jacob Zuma’s time in
power.

 

International ratings agencies have regularly cited Eskom as a threat to
South Africa’s strained public finances.

 

Earlier this month the government named a new Eskom board and told the
company to remove executives facing allegations of “serious corruption and
other acts of impropriety”.

 

 

Anglo American sells Eskom-tied coal assets for $71 million

LONDON (Reuters) - Anglo American on Monday announced the sale of the New
Largo thermal coal project in South Africa for approximately $71 million to
a new majority black-owned-and-managed company, marking its exit from South
African domestic coal.

 

During the depths of the commodity crash in late 2015 and early 2016, Anglo
American sought to sell a large part of its assets, saying it would focus on
copper, diamonds and platinum.

 

As commodity markets recovered, however, the pressure to sell decreased and
at least one coal sale fell through because shareholders could not agree to
sell when the asset was making money.

 

Coal prices are again strong at close to $100 a tonne for Richards Bay coal.
Many companies are shunning the fuel because of its carbon-intensity, but
the mining industry says the developing world still needs it.

 

Mining coal in South Africa is complicated by a dispute with the government
and the industry over a new mining code and by turmoil at indebted power
utility Eskom.

 

“The sale delivers on our long-standing strategy to exit our Eskom-tied coal
assets,” Norman Mbazima, deputy chairman of Anglo American South Africa,
said in a statement.

 

New Largo’s main asset is an 585 million tonne coal resource and related
mining rights, which is positioned to supply Eskom’s new Kusile Power
Station, the statement said.

 

New Largo Coal Proprietary Limited is owned by Seriti Resources Proprietary
Limited and Coalzar Proprietary Limited, two companies majority owned and
controlled by historically disadvantaged South Africans.

 

The deal is subject to regulatory approval and expected to close in the
second half of 2018.

 

Anglo American’s share price rose around 1.5 pct by 0845 GMT, slightly above
the broader market.

 

Paul Gait, analyst at Bernstein, said he liked the deal, carried out in a
supportive coal price environment.

 

It was a “a tail asset that does not form part of the Anglo investment case
for most shareholders,” he said.

 

Another South African player South32, the company spun out of BHP, has said
it willl run its South Africa Energy Coal business as a standalone unit and
is expected to either float it on the Johannesburg Stock Exchange or to sell
it.

 

 

Opel to export cars to Tunisia, Morocco - CEO in FAZ

FRANKFURT (Reuters) - PSA Group’s Opel plans to start exporting cars to
Tunisia and Morocco from its European plants, its chief executive told
German daily Frankfurter Allgemeine Zeitung (FAZ) in an interview.

 

France’s PSA agreed in March to buy Opel from General Motors in a deal
valuing the business at 2.2 billion euros ($2.73 billion). The move was
aimed at helping the group to challenge European market leader Volkswagen.

 

PSA has given Opel until 2020 to return to profit as part of a recovery plan
aimed at shifting the brand’s model line-up onto PSA’s production platforms.

 

“We see good opportunities for us overall,” Opel CEO Michael Lohscheller was
quoted as saying of its African prospects in a summary of an FAZ article to
be published on Monday.

 

The Opel chief said he was not concerned that the sale of Opel cars in
Africa could cannibalise sales of parent PSA.

 

“There are buyers who consciously choose a French brand and there are those
who consciously pick a German brand,” he told the paper.

 

He also said that Opel was making progress with its cost-cutting efforts.

 

($1 = 0.8052 euros)

 

 

Egypt to halt imports of LNG by end of FY 2017/18 - minister of petroleum

CAIRO (Reuters) - Egypt plans to stop importing liquefied natural gas (LNG)
by the end of the 2017/18 fiscal year ending in June as it speeds up
production at recently discovered gas fields, Petroleum Minister Tarek El
Molla said on Saturday.

 

Egypt said previously that it would halt imports by the start of 2019.

 

Molla said the country will save $250 million per month by no longer
importing LNG.

 

 

 

IFC extends $62 million loan to South Africa's Mercantile Bank

CAPE TOWN (Reuters) - The International Finance Corporation (IFC) said on
Monday it would extend a seven-year loan of 740 million rand ($62 million)to
Mercantile Bank to boost lending to small and medium businesses (SMEs), with
a focus on women-owned firms.

 

The IFC, a member of the World Bank, said in a statement the financing was
part of an initiative to invest up to 40 billion rand into South African
SMEs over the next five to seven years.

 

($1 = 11.9640 rand)

 

 

 

Petra Diamonds warns on profit, cuts output view; shares slump

(Reuters) - Petra Diamonds Ltd said on Monday it expects full-year core
earnings to come in about 10 percent to 15 percent below consensus and cut
its 2018 production forecast, sending its shares down 15 percent in early
trading.

 

The company, which operates diamond mines in South Africa and Tanzania, said
earnings before interest, tax, depreciation and amortization (EBITDA) to be
hit by the recent strengthening of the South African rand.

 

The profit warning comes after a three-week strike at its South Africa
operations and the blocking of a consignment of diamonds in Tanzania that
led the company to flag a possible breach of two of its debt covenants in
October.

 

Petra, which had a net debt of about $644.7 million as of Dec.31, said on
Monday it started formal discussions with its lenders to evaluate the
covenants.

 

The London-listed company said it expects to produce 4.6-4.7 million carats
(mcts), below its previous forecast of 4.8-5.0 mcts, primarily due to lower
grade diamonds recovered from its Cullinan mine in South Africa.

 

However, revenue per tonne is expected to be materially in line with
estimates, helped by higher average diamond prices.

 

It expects overall 2018 revenue to remain in line with current consensus,
including the expected sale of the blocked consignment of diamonds in
Tanzania.

 

As part of a wider crackdown in its mining industry, Tanzania blocked the
consignment after accusing Petra of under-declaring the value of the stones
by about half. Petra has denied the accusation.

 

 

Kenyan shilling strengthens slightly on offshore demand

NAIROBI (Reuters) - Kenya’s shilling strengthened slightly on Monday, helped
by dollar inflows from offshore investors amid dollar weakness globally,
traders said.

 

At 0910 GMT, commercial banks quoted the shilling at 102.3/4 to the dollar,
compared with Friday’s close of 102.35/45

 

 

South Africa's rand slightly weaker, stocks set to open flat

JOHANNESBURG (Reuters) - South Africa’s rand softened against the dollar
early on Monday, but stayed below the psychological 12 rand per dollar
breached last week as expectations of economic reforms boosted sentiment
towards local assets.

 

At 0645 GMT, the rand traded at 11.8900 per dollar, 0.3 percent weaker than
its New York close on Friday.

 

Optimism over changes promised by the new leader of the ruling African
National Congress (ANC), Cyril Ramaphosa, helped drive the currency higher.

 

The rand has surged since Ramaphosa won the race to succeed Jacob Zuma as
ANC leader last month, putting him in pole position to become South Africa’s
next president.

 

Stocks were set to open flat at 0700 GMT, with the JSE securities exchange’s
Top-40 futures index largely unchanged.

 

In fixed income, the yield for the benchmark government bond was up 1.5
basis point at 8.44 percent.

 

 

Coincheck promises 46bn yen refund after cryptocurrency theft

As many as 10,000 businesses in Japan are said to accept crypto-currencies.

One of Japan's largest digital currency exchanges has said it will refund
most of the $534m (£380m) worth of virtual assets lost in a hacking attack.

 

Coincheck has promised to use its own funds to reimburse more than 46bn yen
($423m) to customers who lost their NEM cryptocurrency coins on Friday.

 

The Tokyo-based company suspended trading after detecting "unauthorised
access" of its digital exchange.

 

Some 260,000 customers are said to be affected by the reported theft.

 

Coincheck said on Sunday that the amount it has promised to return covers
nearly 90% of the 58bn yen worth of NEM coins lost in the attack.

 

After the breach was discovered on Friday, the company froze deposits and
withdrawals for all cryptocurrencies except Bitcoin as it assessed its
losses in NEM, a lesser-known currency.

 

The stolen Coincheck assets were said to be kept in a "hot wallet", which is
a part of the exchange connected to the internet, as opposed to a "cold
wallet", where funds are stored securely offline.

 

The company says it has the digital address of where the assets were sent.

 

As many as 10,000 businesses in Japan are said to accept cryptocurrencies.

 

In 2014 MtGox, another Tokyo exchange, collapsed after admitting that $400m
had been stolen from its network.

 

Hackers broke in at 02:57 on Friday (17:57 GMT Thursday), the company said
in a statement, but the breach was not discovered until 11:25, nearly eight
and a half hours later.

 

Company chief operating officer Yusuke Otsuka said 523m NEMs had been sent
from Coincheck's NEM address during the breach.

 

"It's worth 58bn yen based on the calculation at the rate when detected," he
told reporters at the Tokyo Stock Exchange.

 

Coincheck then looked into how many customers were affected and whether the
break-in had been launched from Japan or another country.

 

"We know where the funds were sent," Mr Otsuka added. "We are tracing them
and if we're able to continue tracking, it may be possible to recover them."

 

Coincheck reported the incident to the police and to Japan's Financial
Services Agency.

 

How damaging is the loss?

NEM, the 10th-largest crypto-currency by market value, fell 11% over a
24-hour period to 87 cents, Bloomberg news agency reported.

 

Among the other cryptocurrencies, Bitcoin dropped 3.4% and Ripple retreated
9.9% on Friday, according to prices seen by the agency.

 

More was lost on Friday than in 2014, when MtGox lost what it thought was
850,000 bitcoins. However, MtGox later found 200,000 bitcoins in an old
digital wallet.

 

After the collapse of MtGox shook the digital currency world, a licensing
system was introduced in Japan to increase oversight of local currency
exchanges such as Coincheck.

 

"What's the lasting impact? It's hard to tell," Marc Ostwald, global
strategist at ADM Investor Services International in London, told Bloomberg.

 

"Japan is one of the most pro-crypto trading countries, among the G-20. In
Japan they don't really want a wholesale clampdown. So it will be
interesting how Japanese regulators respond to this, if they indeed do."

 

What is Coincheck?

Founded in 2012, the company is based in Tokyo, where it employed 71 people
as of August last year.

 

Its headquarters are located in the city's Shibuya district, an area popular
with start-ups that was also home to MtGox, Bloomberg reports.

 

Last year, Coincheck began running adverts on national television featuring
popular local comedian Tetsuro Degawa, the agency adds.

 

Kunihiko Sato, a 30-year-old customer from Tokyo, told Kyodo he had
deposited about 500,000 yen ($4,600), into his account with the exchange.

 

"I never thought this kind of thing would happen with Japan's developed
legislation," he said.

 

How do crypto-currencies work?

Whereas money is printed by governments or traditional banks, digital
currencies are generated through a complex process known as "mining".
Transactions are then monitored by a network of computers across the world
using a technology called blockchain.

 

There are thousands of them, largely existing online, unlike the notes or
coins in your pocket.

 

It may be more useful to think of them as assets, rather than digital cash.
The vast majority of Bitcoin holders, for instance, appear to be investors.
But the anonymity that cryptocurrencies afford has also attracted criminals.

 

The value of a cryptocurrency is determined by how much people are willing
to buy and sell them for.--BBC

 

 

New York investigates company accused of selling fake Twitter followers

New York's chief prosecutor says the state is opening an investigation into
a firm that allegedly sold millions of fake followers to social media users.

 

"Impersonation and deception are illegal under New York law," said Eric
Schneiderman.

 

The company, Devumi, stands accused of stealing real people's identities,
which it denies, according to the New York Times.

 

The paper linked the "follower factory" to a host of celebrity accounts.

 

The New York Times published an in-depth report on Devumi on Saturday,
including interviews with people who alleged their account details and
profile pictures had been copied to create realistic "bots".

 

It is alleged that others who wanted to increase their follower count,
including actors, entrepreneurs and political commentators, could then pay
to be followed by the bots.

 

On social media, high follower accounts boost influence, which can impact
public opinion, or bring advantages, such as job offers or sponsorship
deals, to account holders.

 

Mr Schneiderman said he was concerned that such "opaque" operations were
undermining democracy.

 

On its website, Devumi offers customers the chance to order up to 250,000
Twitter followers, with prices starting at $12 (£8.50). Clients can also buy
"likes" and retweets.

 

The company sells followers on a range of other platforms, including
Pinterest, LinkedIn, Soundcloud and YouTube.

 

 

"Devumi has helped over 200,000 businesses, celebrities, musicians,
YouTubers and other pros gain more exposure and make a big impact to their
audience," says its website.

 

The company is registered at a New York City address, although the New York
Times alleged it is a front, with its actual offices in Florida and it also
employs workers in the Philippines.

 

Twitter has responded to the investigation, saying it is working to stop
Devumi and similar companies.

 

In the past, Twitter has been accused of not taking the problem seriously
enough. It has often dismissed bot investigations as "inaccurate and
methodologically flawed".

 

The platform does allow automated accounts, but it strictly prohibits them
being bought or sold. It says it will suspend accounts that are found to
have purchased followers, retweets or likes. However, a representative told
the New York Times it rarely does this in practice, as it is hard to prove.

 

The report alleges that Devumi has a stock of at least 3.5 million automated
accounts, many of which are sold repeatedly.

 

It alleges at least 55,000 of the accounts "use the names, profile pictures,
hometowns and other personal details of real Twitter users, including
minors".

 

"These accounts are counterfeit coins in the booming economy of online
influence, reaching into virtually any industry where a mass audience — or
the illusion of it — can be monetized. Fake accounts, deployed by
governments, criminals and entrepreneurs, now infest social media networks,"
they wrote.

 

Whose accounts have been linked?

The New York Times found many well-known Twitter accounts have followers
from the Devumi "factory". It said the company's clients covered the
political spectrum, from liberal cable pundits to a reporter at the
right-wing site Breitbart and an editor at China's state-run news agency,
Xinhua.

 

Martha Lane Fox: Entrepreneur and member of the UK's House of Lords

 

Martha Lane Fox's Twitter account showed "a series of follower purchases
spanning more than a year", including a 25,000-follower boost days after she
became a Twitter board member in April 2016. She told the New York Times a
"rogue employee" was responsible.

 

Paul Hollywood: British TV chef

 

The investigation showed Devumi-managed bots following Paul Hollywood's
official Twitter profile. Shortly after the paper emailed him to ask
questions, his account was deleted.

 

Hilary Rosen: political commentator

 

The CNN contributor has paid for over 500,000 Twitter followers - although
most have been deleted. She said it was "an experiment I did several years
ago to see how it worked".

 

Randy Bryce: US ironworker turned politician

 

On Saturday, Mr Bryce - who is trying to unseat Republican Paul Ryan in
Congress - said, on Twitter, that he bought the followers as an experiment
in 2015, when he was a blogger.

 

--BBC

 

 

Are President Trump's tax cuts helping workers?

It is bonus season in America - and this year, companies are cutting some
workers special cheques.

 

At Disney, 125,000 workers will receive a $1,000 one-time bonus. Alaska
Airlines said 23,000 of its staff would get $1,000 awards, on top of their
usual incentive system. And about 60,000 employees at Fiat Chrysler
Automobiles are due to take home $2,000 extra.

 

Those companies are just three of the roughly 250 firms that have announced
bonuses, pay increases, more generous benefits or US investments, citing tax
cuts the US passed in December, according to Americans for Tax Reform, an
organisation that lobbies for lower taxes.

 

All told, the group counts at least 3 million Americans due for some kind of
boost from employers as a result of the overhaul, which slashed the
corporate rate from 35% to 21%.

 

The announcements have reignited debate over whether the controversial law -
estimated to cost a total of $1.5tn from 2018 through 2027 - is good for the
average American.

 

What does the White House say?

On its face, the new law provides relatively minimal benefit for households.

 

The cuts for families are estimated to amount to an average of just $1,600
in 2018 - a difference of less than $31 per week. And most of the benefits
will accrue to the wealthiest families.

 

The White House has seized on the company announcements as proof the law
offers other benefits to workers.

 

Chart showing expected tax savings by income bracket

As President Donald Trump put it in a recent Twitter post: "Tremendous
investment by companies from all over the world being made in America. There
has never been anything like it.

 

"Now Disney, J.P. Morgan Chase and many others. Massive Regulation Reduction
and Tax Cuts are making us a powerhouse again. Long way to go! Jobs, Jobs,
Jobs!"

 

What do opponents say?

Opponents of the overhaul have dismissed the announcements as little more
than publicity stunts, pointing to billions more going to share buybacks and
dividends - and in some cases, layoffs at the very companies promoting the
awards.

 

Telecommunications giant AT&T, for example, was among the first to announce
its plans: $1,000 bonuses for more than 200,000 workers and $1bn in extra US
investment in 2018.

 

But the company - which is trying to win government approval to purchase
Time Warner - is also negotiating with union workers over roughly 1,000
layoffs.

 

Similar elements of spin and redundancies have coloured other announcements.

 

On the same day that Walmart announced plans to increase its minimum pay to
$11 and offer bonuses of up to $1,000, word emerged that the firm was
closing 63 of its Sam's Club stores and laying off thousands of workers.

 

Apple, after touting a five-year $350bn contribution to the US economy,
acknowledged that much of the money reflected its current spending pace.

 

Donald Trump and the US economy in six charts

Paradise Papers: Apple's secret tax bolthole revealed

And the firm - which politicians have criticised for years for its overseas
cash pile and offshore manufacturing - had already committed nearly as much
- $300bn - to buy back shares and boost dividends.

 

In the broader context, the benefits for workers are "trivial", says Beth
Allen, spokeswoman for the Communications Workers of America, the labour
union that represents staff at AT&T and other companies.

 

"Our workers at AT&T in particular, because the layoffs happened at the same
time, saw it for what it was - which was something the company was doing to
get to the press," she said.

 

Are there other reasons for the plans?

Analysts say companies have reasons outside of the tax bill to be
re-thinking worker benefits.

 

The US unemployment rate is now hovering around 4.1% - a level last seen in
2000 - putting pressure on firms to keep workers happy.

 

Chart showing the dropping US unemployment rate

But it is also clear that self-promotion and political calculus are driving
some of the announcements.

 

"Why didn't they just tell their workers privately?" says Laurence
Kotlikoff, an economics professor at Boston University, who described some
of the announcements as "implicit back-scratching" for the White House.

 

"They're making a big deal of this to serve some other purpose, maybe
getting the country to like their product or getting the government to lay
off a bit."

 

Banks represent more than a third of the companies with announcements on the
Americans for Tax Reform list. That sector is among the biggest
beneficiaries of the tax changes, and also expects lighter regulations.

 

Many companies, however, were already paying below the 35% headline rate.

 

Professor Kotlikoff says that suggests firms are making their decisions due
to sentiment - not policy changes. Those moods can shift quickly, he warns.

 

What long-term effect will this have?

The White House maintains the optimism will translate into expansion and
investments, hiring, and, ultimately, higher wages, as firms compete for
workers.

 

That would be a welcome change for the US after years of relatively stagnant
wage growth.

 

Chart showing how US wages have remained almost flat

John Bremen, who advises companies on human capital and benefits as a
managing director for Willis Towers Watson, says there are signs that is
starting to happen.

 

His firm surveyed more than 300 companies, and found that roughly two-thirds
were considering improving benefit packages or had already taken action as a
result of the law.

 

Many firms were already looking at ways to retain and attract workers due to
the tight labour market, but the tax law "amplifies it and accelerates it,"
he says.

 

Trump tax bill: Winners and losers

Trump tax cuts: Here's why they matter to us all

Economists predict the tax cuts will boost the US - and global - economy,
albeit modestly, by spurring consumer spending and investment.

 

This week, the IMF revised up its global growth forecast by 0.2 percentage
points, citing the overhaul. In the US, the Tax Policy Center says tax cuts
are likely to lift the economy by 0.8% in 2018, but the effects will fade
over the decade.

 

As departing Federal Reserve Chair Janet Yellen said when asked about the
effect of the tax cuts last month: "Much uncertainty remains."

 

The same could be said for the American worker.--BBC

 

 

Donald Trump came to Davos with a mission to reassure

Few people knew what to expect.

 

Would this be belligerent Trump - wagging his finger at the global elite
about how divorced they were from reality, from what people really want?

 

Or would this be conciliatory Trump, setting a different tone? We heard the
second.

 

The president touched many of the World Economic Forum's erogenous zones.
But many were not quite sure how to take it considering the pit bull they
were expecting.

 

He talked about the voices of the forgotten - a constant theme here among
the "super-haves" who are coming to a creeping realisation that the system
has to change if faith in the capitalist system is to endure.

 

He talked about economic success being about more than the sum of
production, it was about the "sum of its citizens".

 

Businesses, he argued, had to remember their obligations to the people who
worked for them.

 

Critics will pick at the easy holes. For example, on those income tax cuts
it's the wealthy who will gain more.

 

And the business tax cuts are far larger than those for middle-income
Americans.

 

Mr Trump said that America First did not mean America Alone. It was the key
line of the speech.

 

Fair trade, not trade war

And it was a message echoed by other leading members of the White House
power pack here, including Gary Cohn, the president's chief economic adviser
and head of the US National Economic Council.

 

This is all about trade and the US approach.

 

The fear was that America under Mr Trump would throw up a series of trade
barriers, increasing protectionism at a time when most government leaders at
Davos - Narendra Modi of India, Justin Trudeau of Canada and Emmanuel Macron
of France - were preaching the gospel of globalisation.

 

But today we heard a more nuanced manifesto. America, Mr Trump said, did not
want a trade war, it wanted fair trade.

 

Which may come as a surprise to countries like South Korea, smarting this
week following the imposition of tariffs on US imports of solar panels and
washing machines.

 

Mr Trump's argument is this:

 

The rules of the free trade world were built after the Second World War when
America's economic interests were rooted in the successful development of
other countries' economies.

 

These countries then became eager customers for American products.

 

That equation has changed. China is a much more powerful economy.

 

The Asian emerging markets, South America and Europe all now have much more
muscular dogs in the fight for global trade.

 

Mr Trump said state planning, intellectual property theft and industrial
subsidies were the new weapons of trade wars - and used against America.

 

"Fair and reciprocal trade" is the new US mantra.

 

And if the administration feels it does not receive such treatment, the
president will act - for example, by passing an executive order pulling the
US out of the Trans-Pacific Partnership, the 12-nation Asian trade deal.

 

Mutual benefit

It's a message that has not fallen on stony ground here.

 

"I don't think it's inappropriate that we re-look at some of the treaties
that were so asymmetric," Larry Fink, the chief executive of investment
company BlackRock, told me.

 

"Some of these countries now are very strong and very developed. It's going
to be a long game.

 

"The world is benefitting by global trade and we need to find ways of
creating more global trade to benefit more humanity worldwide," he said.

 

America is still a trading nation, one which gains far more economically
from globalisation - world trade - than it does from protectionist measures.

 

And that brute economic truth means that Mr Trump has to play a different
tune here - to the business leaders and investors who decide where to place
their cash - than maybe to the left-behind voters of the US rust belt.

 

So the president said that America was ready to do bilateral deals that
would be "mutually beneficial".

 

He even suggested a re-engagement with the TPP. On trade, this was Trump
2.0.

 

The politics might have been angry in the past, but today, economic reality
softened the president.--BBC

 

 

China's eight-year-long smartphone growth comes to an end

China's smartphone market has fallen for the first time, with annual
shipments down by 4% in 2017, according to data from research firm Canalys.

 

The decline ends eight years' growth in the world's largest mobile phone
market.

 

Smartphone brands Huawei, Oppo and Vivo continue to dominate the Chinese
handset market.

 

Despite the overall slowdown of the market, Huawei saw double-digit growth,
the Canalys report said.

 

Changing times

Between 2010 to 2015, the global smartphone market was mostly a showdown
between Apple and Samsung.

 

But over the last two years, smaller Chinese Android smartphone brands have
risen, offering faster entry-level phones at much more affordable prices.

 

While consumers in big Chinese cities like Beijing and Shanghai see the
latest iPhone and Galaxy devices as "must-have" handsets, people in rural
areas couldn't afford the hefty price tags and mostly stuck to basic feature
phones.

 

Sales of smartphones in China

To offer these consumers a premium experience at a lower price, Oppo and
Vivo - both owned by reclusive billionaire Duan Yong Ping - chose to eschew
online and instead open retail stores on high streets in rural provinces.

 

The approach of offering an Apple-esque in-store customer experience was
successful. In 2016, China saw a huge boom in consumers swapping their basic
phones for premium smartphones.

 

According to Counterpoint Research, by August 2017 Huawei had sold almost as
many smartphones as Apple. By the end of 2016, it had already dethroned
Samsung from the top spot as most profitable Android device brand in the
world.

 

Market saturation

So why the decline? According to Mo Jia, research analyst at Canalys, now
that consumers have traded up from basic phones to entry-level smartphones,
they feel they don't need another one.

 

People are saying that "the phones they have now are already good enough,"
Mr Jia told the BBC. "We say that it's gone from a 'change' market to a
'stop' market."

 

Since even entry-level smartphones have an abundance of features, the life
cycles of these devices are much longer than before, now up to 26.8 months,
according to Canalys.

 

The research firm does not see the Chinese smartphone market growing until
5G devices hit the scene in late 2019.

 

And while the perceived "luxury" prestige of iPhones will prompt some
consumers to want to trade up, Mr Jia points out that the latest smartphones
from Chinese brands are almost equivalent in specs and hardware to Apple's
handsets.

 

"The phone makers are making much better phones. For example, if you look at
the Huawei Mate 10 and the Mate 10 Pro, their specs are comparable to iPhone
8 and iPhone 8 Plus. But the Mate 10 is at least 30% cheaper than the iPhone
8," he said.

 

Samsung's marketing disaster early last year over battery faults with the
Galaxy Note 7 severely damaged its brand reputation in China.

 

So, when people wanted a new Android device, they were much more likely to
look to Huawei, Oppo and Vivo, Mr Jia added.

 

Expanding abroad

With the Chinese market looking pretty saturated for now, overseas expansion
will be critical for Huawei, Oppo and Vivo in 2018.

 

"Oppo and Vivo are trying to expand into more countries like Russia and
Japan, and they're trying to deepen their market in South East Asia," said
Mr Jia.

 

"Xiaomi is doing very well in India. They are the most popular brand there
and are seeking to open more stores. They are also expanding into Thailand."

 

Meanwhile, Huawei's focus is on "budget smartphones" - cheaper entry-level
or mid-level devices.

 

The Chinese tech giant has not had much success lately in the US, as talks
to release the Mate 10 Pro on AT&T collapsed due to government security
concerns.

 

But Huawei is looking to continue growing in developing markets in South
East Asia and Africa, while retaining and growing its existing popularity in
Europe.--BBC

 

 

US economy loses steam as imports surge

US economic growth slowed unexpectedly to an annualised rate of 2.6% in the
last three months of 2017, the Commerce Department said on Friday.

 

Economists had expected the rate to be 3% - the same as the three months to
September.

 

A surge in imports was blamed for the slowdown, which meant growth for 2017
came in at 2.3%.

 

That was better than the 1.5% posted in 2016, but well short of President
Donald Trump's 3% target.

 

Imports surged by 13.9% in the quarter - the fastest pace since the third
quarter of 2010 - offsetting a rise in exports.

 

As a result, trade sliced off 1.1 percentage points from GDP growth in the
three months.

 

Despite the slowdown, economists expect the US economy to expand by 3% this
year, spurred by the weak dollar, rising oil prices and a strong global
economy.

 

Grey line

Analysis: Andrew Walker, BBC economics correspondent

The figure is below the previous quarter and less than what was expected,
but not by much.

 

If rather than using the annualised figures that the US Bureau of Economic
Affairs always publishes, we consider the simple quarterly growth numbers,
the slowdown is just 0.2% and the miss compared to expectations only half of
that.

 

One of the reasons for the slightly lower figure is firms reducing their
inventories - selling off goods they have already produced. They cannot do
that forever.

 

Manufacturers will have to start replenishing their stocks sooner or later.
The positive in the figures was a strong surge in business investment.

 

The conclusion: the figures point to an economy whose underlying growth is
pretty firm.

 

Grey line

Addressing the World Economic Forum in Davos, Mr Trump hailed the strong US
economic growth: "The world is witnessing the resurgence of a strong and
prosperous America."

 

"Now is the best time to bring your money, your jobs, your businesses to
America," he said, pointing to recent tax reform and curbs on red tape as
good for the investment climate.

 

The president made another attack on "predatory" and said the US will not
tolerate unfair trade.

 

The US dollar made up some ground against sterling and the euro after the
GDP figures were released, but has fallen more than five cents against both
currencies in the past three months.--BBC

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 


 

 


 

INVESTORS DIARY 2018

 


Company

Event

Venue

Date & Time

 


 

 

 

 

 


 

 

 

 

 


 

 

 

 


 

 

 

 


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DISCLAIMER: This report has been prepared by Bulls ‘n Bears, a division of
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been compiled from sources believed to be reliable, but no representation or
warranty is made or guarantee given as to its accuracy or completeness. All
opinions expressed and recommendations made are subject to change without
notice. Securities or financial instruments mentioned herein may not be
suitable for all investors. Securities of emerging and mid-size growth
companies typically involve a higher degree of risk and more volatility than
the securities of more established companies. Neither Faith Capital nor any
other member of Bulls ‘n Bears nor any other person, accepts any liability
whatsoever for any loss howsoever arising from any use of this report or its
contents or otherwise arising in connection therewith. Recipients of this
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investigation into the business, financial condition and future prospects of
any companies referred to in this report. Other  Indices quoted herein are
for guideline purposes only and sourced from third parties.

 


 

 


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