Major International Business Headlines Brief::: 19 July 2018

Thu Jul 19 10:11:22 CAT 2018

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Major International Business Headlines Brief::: 19 July 2018

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*  Ghana's economy seen up to 40 pct bigger after data overhaul -officials

*  Nigeria's Senate to investigate "anomalies" in renewal of oil leases

*  South Africa gold producers offer single-digit pay hikes to unions

*  Shoprite annual sales growth slowed by Angola

*  Kenya to launch Nairobi financial centre later this year-finmin

*  Equatorial Guinea targets CHC Helicopter in compliance crackdown

*  S.Africa's Solidarity union to agree wage deal with Eskom: source

*  Steinhoff extends lock-up early bid fee deadline for second time

*  Egypt remittances expected to rise nearly 50 pct to $26 bln for FY 2017-18

*  South Africa's retail sales up 1.9 percent y/y in May

*  Ryanair cancels 600 flights over cabin crew strike

*  EasyJet to sue over French air strikes

*  Farnborough Airshow: Aston Martin unveils sports car for the skies

*  Lift-off for Scotland: Sutherland to host first UK spaceport

*  UK unveils new Tempest fighter jet model

*  Google hit with €4.3bn Android fine from EU

*  Summer clothing sales hold back inflation

 <mailto:info at bulls.co.zw> 

Ghana's economy seen up to 40 pct bigger after data overhaul -officials

ACCRA (Reuters) - Ghana’s economy will be up to 40 percent bigger than previously calculated when the West African country completes an overhaul of its economic output data in September, two senior government officials told Reuters on Wednesday.

The major commodity exporter is recalculating its gross domestic product based on measurements from 2013 instead of 2006 to more accurately reflect recent activity in the petroleum, communication technology and construction sectors, the statistics office said.

“The indication is that this year’s rebasing will add 30 percent or more to the size of the economy... It could be up to 40 percent,” a senior official close to the government’s economic management team told Reuters.

“It’s likely to be around 30-40 percent expansion”, another official told Reuters.

Ghana’s $47 billion economy ranks eleventh in Africa after Tanzania, according to IMF estimates for 2017. A 30 percent expansion will move it up one spot.

The statistics office plans to announce the new data in September, together with second quarter GDP growth. The economy expanded 6.8 percent in the first three months, it said in June.

The economy of the cocoa and gold producer expanded by 60 percent in 2010 when the country rebased its national accounts, leaping into middle-income status.

This year’s rebasing would automatically make the government’s deficit and debt levels appear more benign. But it also means Ghana’s already low tax revenue as a ratio of GDP would further slide below the regional average, analysts said.

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Nigeria's Senate to investigate "anomalies" in renewal of oil leases

ABUJA (Reuters) - Nigeria’s upper house of parliament will investigate anomalies in the renewal of oil leases by the ministry of petroleum, it said on Wednesday.

Nigeria is Africa’s biggest crude oil producer and oil sales make up around two-thirds of government revenue. Oil companies must periodically renew their oil block licences to continue extraction or exploration.

The Senate voted for a committee to “report to the Senate the anomalies in the ongoing lease renewal process and identify appropriate measures to correct the said anomalies”.

It followed the reading of a motion on the floor of the Senate which stated that “illegal discounts and rebates” had been granted by the ministry.

“The ongoing lease renewal process is capable of denying government revenue in excess of $10 billion as a result of illegal discounts and rebates in the process of lease renewal,” the motion stated.

Idang Alibi, director of press at the Ministry of Petroleum Resources, declined to comment.

On July 10, Nigerian lawmakers voted to investigate the state oil firm, the Nigerian National Petroleum Corporation, over a shortfall in revenue remittances to government coffers.

South Africa gold producers offer single-digit pay hikes to unions

JOHANNESBURG (Reuters) - South African gold producers said on Tuesday they had offered annual wage increases of up to 6.5 percent to miners and up to 4.5 percent for skilled workers, far short of union demands and confirming a Reuters’ report earlier on Wednesday.

Gold producers have been giving above-inflation wage hikes for years, adding to the cost burden of an industry that has been battling depressed prices, labour unrest and soaring power bills.

Inflation is currently 4.6 percent and food inflation - often a key driver in such talks as the typical South African miner has several dependants - is 3.4 percent. In past years it has been in double digits during such negotiations.

While marginally above inflation for most workers, the offer falls short of the hikes demanded by the four unions involved, which reach over 30 percent in some cases. One union source told Reuters that the gold producers’ offers were “very low”.

The four companies involved are Sibanye-Stillwater, Harmony Gold, AngloGold Ashanti and a smaller producer, Village Main Reef. The group is negotiating under the auspices of the Minerals Council South Africa industry grouping.

“The industry has sought to find a balance between employees’ expectations and preserving the long-term viability and sustainability of the industry,” Motsamai Motlhamme, the industry’s chief negotiator, said in a statement.

The offer is for three years and the annual percent increases will decline slightly over that period.

The four unions are the National Union of Mineworkers (NUM), the Association of Mineworkers and Construction Union (AMCU), Solidarity and UASA.

The NUM wants the basic monthly pay for entry-level underground workers to rise to 10,500 rand ($785) over the next two years, which translates into annual increases of between 15 and 18.5 percent, depending on the company.

AMCU has put in demands of over 30 percent.

In a presentation to the unions on Wednesday, the companies said 75 percent of gold mines in South Africa, once the world’s top gold producer, are currently loss-making or marginal.

The number of jobs in the sector has fallen to almost 118,000 last year from 157,000 in 2010, the presentation showed, while annual production over the same period fell to 138 tonnes from 188 tonnes.

South Africa’s gold mines are the deepest in the world, reaching as far as 4 kms (2-1/2 miles) underground, and margins and grades have shrunk at such depths after over a century mining that has produced a third of the bullion mined in recorded history.

($1 = 13.3340 rand)

Shoprite annual sales growth slowed by Angola

JOHANNESBURG (Reuters) - Africa’s biggest supermarket chain Shoprite Holdings said on Wednesday annual turnover increased by 3.3 percent, missing analyst estimates, as problems stemming from currency devaluation in Angola weighed on group performance,

Total turnover grew to about 145.6 billion rand ($10.90 billion) in the 12 months to June 2018, Shoprite said in its operational update. That compared with a consensus forecast of 150.5 billion rand in a Reuters poll of 10 analysts.

Chronic shortage of foreign currency and currency devaluation in Angola remains an issue for the supermarket chain, which said excluding the impact of the Angolan hyperinflation accounting adjustment, group turnover increased 3.6 percent.

Angola has been hit by a severe shortage of dollars and the currency has been devalued some 30 percent to the dollar this year.

At 1315 GMT, shares in Shoprite declined 5.17 percent to 208.99 rand.

“Despite the demanding trading environment, exasperated by the sharp decline in internal inflation, the group remains positive about its operational strength, customer support for its brands and is making progress on its strategic priorities,” Shoprite said.

($1 = 13.3590 rand)

Kenya to launch Nairobi financial centre later this year-finmin

NAIROBI (Reuters) - Kenya will launch its international financial centre in the capital Nairobi later this year to attract large foreign financial firms and boost capital flows, its finance minister said on Wednesday.

The government of East Africa’s biggest economy has been working with Qatar since 2014 to build a financial centre in Nairobi that mirrors Doha’s international financial centre.

“The Nairobi international financial centre will be critical to attracting international capital into the Kenyan market,” Henry Rotich told a capital markets meeting.

The Kenyan financial centre is expected to compete with other established financial centres in the region like Mauritius.

Despite Kenya’s relatively developed capital markets, 75 percent of all business financing in the economy was from the banking sector, while the balance came from the capital markets, Rotich said, adding that the situation was not ideal.

“We should be funding our businesses through equity and bonds under the capital markets as opposed to the loans through the banking sector,” the minister said.

“I urge the capital markets to aggressively work on this aspect and tilt the share of capital assets in funding business requirements.”

Kenya required an investment level of 30 percent of gross domestic product (GDP) and a savings rate of over 25 percent of GDP to sustain growth of 10 percent a year, the minister said.

The Treasury expects growth to bounce back to 5.8 percent this year after drought, election uncertainties and a slowdown in private lending cut it to 4.9 percent last year.

Equatorial Guinea targets CHC Helicopter in compliance crackdown

MALABO (Reuters) - Equatorial Guinea has told petroleum operators including Exxon Mobil to cancel contracts they have with Canadian-based CHC Helicopter for failing to implement local content laws meant to create jobs, the oil ministry said on Wednesday.

OPEC member and Africa’s third-largest oil producer, Equatorial Guinea’s national content regulations of 2014 state that agreements must make provisions for capacity building and give preference to local companies when awarding service contracts.

“These laws are in place to protect and promote local industry, create jobs for citizens... and we are aggressively monitoring and enforcing compliance of these requirements,” said Gabriel Mbaga Obiang Lima, the minister of mines and hydrocarbons in a statement.

The ministry has given oil companies operating in the Central African nation 60 days to unwind existing contracts and find new suppliers, with only those companies found in compliance allowed to bid for contracts.

CHC Helicopter specializes in providing transportation to offshore oil and gas platforms, among others.

“We expect all companies operating in Equatorial Guinea to follow the laws of the Republic... (and) as minister I will not hesitate to enforce the law to ensure compliance,” Obiang Lima said.

In response, CHC Helicopter said it has operated in the country for almost two decades and built one of the most comprehensive training programmes, which includes pilots and engineers, of any oil and gas contractor working.

“CHC is confident we are in compliance with Equatorial Guinea’s National Content Regulations,” Brian Banco, global communications senior manager said in an email.

He said the company welcomed further discussions with authorities planned for this week.

S.Africa's Solidarity union to agree wage deal with Eskom: source

JOHANNESBURG (Reuters) - South Africa’s Solidarity trade union will accept a three-year wage offer from state-run utility Eskom that would see pay hikes of 7.5 percent this year followed by annual rises of 7 percent, a union source told Reuters on Tuesday.

Cash-strapped Eskom, which provides virtually all of South Africa’s power, initially said it could afford no increases, angering unions and triggering protests that led to a spate of controlled blackouts in Africa’s most industrialised economy.

Eskom has two offers on the table, with the other being 7 percent raises for three consecutive years along with hikes in housing allowance benefits linked to inflation.

The National Union of Mineworkers (NUM), one of the two other unions involved in the wage talks, said in a statement that it would take the latest offers back to its members and that wage talks would be held again on July 27.

Irvin Jim, General Secretary of the National Union of Metalworkers of South Africa (NUMSA), said in remarks broadcast on the eNCA news network that it would also present the offers to its members. The trio of unions accounts for over half of Eskom’s workforce.

The source for Solidarity, which represents mostly skilled workers, said late on Tuesday that a settlement had not yet been signed but the offer “was well within” the mandate of its members, meaning it was effectively a done deal.

Repairing Eskom’s depleted balance sheet is a major challenge for President Cyril Ramaphosa. Sources in the ruling African National Congress have said Eskom assets may be sold off but this would likely face stiff union opposition.

Eskom is regularly cited as a threat to South Africa’s credit rating because it has more than 220 billion rand ($16.6 billion) of government-guaranteed debt.

($1 = 13.2767 rand)

Steinhoff extends lock-up early bid fee deadline for second time

JOHANNESBURG (Reuters) - Steinhoff extended its “early bird fee” deadline for the second time on Wednesday for creditors to sign a three-year agreement to hold off their debt claims, as the scandal-hit South African retailer battles to stay afloat.

Steinhoff wants to restructure its roughly nine billion euros debt after disclosing holes in its balance sheet that wiped more than 90 percent off its market value and forced it into asset sales to fund working capital.

The initial deadline was set for July 16, which was extended by 24 hours before that was pushed back by the same timeline to 2200 GMT on Wednesday.

Creditors who sign up the so-called lock-up agreement (LUA) within this time frame would qualify for an early bird fee.

“Positive progress is being made and the group is aiming to obtain, as soon as possible, the requisite support levels under the LUA,” Steinhoff said in a statement.

Steinhoff needs at least 75 percent of creditors to sign up by the final deadline of the lock-up agreement on Friday. Once enough creditors are locked in the three-year deal, Steinhoff would begin restructuring its debt within three months.

The company has already agreed the main terms of a restructuring deal, under which all its debt would be restated at par and be given a common maturity date of three years from the completion of the restructuring agreement.

Shares in Steinhoff were down one percent and 4.2 percent in Johannesburg and Frankfurt, respectively.

Egypt remittances expected to rise nearly 50 pct to $26 bln for FY 2017-18

CAIRO (Reuters) - Remittances from Egyptians abroad are expected to hit $26 billion for the 2017-18 fiscal year that ended in June, the central bank said late on Tuesday, a nearly 50 percent jump year-on-year but less than an earlier projection.

Remittances have surged since Egypt floated its pound currency in late-2016 and drew hard currency back to its official banking system, drying up a then-thriving black market for dollars.

The central bank said earlier this month that remittances had reached $26 billion for the first 10 months of the fiscal year, but Tuesday’s statement revised that 10-month figure down to $21.9 billion.

Still, the $26 billion year-end total marks a 49 percent rise from the $17.453 billion Egypt netted the previous fiscal year according to central bank data.

Remittances have become a crucial source of hard currency for the import-dependant country, which has struggled to significantly boost exports or foreign direct investment despite tough economic reforms tied to a $12 billion IMF loan programme it began in late-2016.

South Africa's retail sales up 1.9 percent y/y in May

JOHANNESBURG (Reuters) - South African retail sales rose 1.9 percent year-on-year in May after increasing by 0.5 percent in April, the statistics office said on Wednesday.

On a month-on-month basis, sales rose 1.1 percent. Sales rose 2.4 percent in the three months to the end of May compared with the same period last year, Statistics South Africa said.

Ryanair cancels 600 flights over cabin crew strike

Irish airline Ryanair has cancelled up to 600 flights over two days next week due to a strike by cabin crew in Belgium, Portugal and Spain.

It will affect almost 50,000 passengers who had booked to fly to or from those three countries on Wednesday 25 July and Thursday 26 July.

Ryanair apologised for the disruption.

It has already contacted the affected passengers and said if customers have not received an email or SMS text, they should expect to travel as scheduled.

The European cabin crew strike follows on from separate industrial action by Ryanair's Irish-based pilots.

On Wednesday, the airline confirmed it had to cancel 24 flights between Ireland and the UK scheduled for Friday 20 July due to the pilots' strike.--BBC

EasyJet to sue over French air strikes

EasyJet will complain to the European Commission about strikes by French air traffic controllers, which have caused thousands of flights to be cancelled.

The industrial action has cost the airline £25m and resulted in more than 2,600 flights being cancelled in the three months to 30 June.

Chief executive Johan Lundgren argued EU law was being breached by failing to protect flights over France.

A failure to take action was breaching citizens' freedom of movement, he said.

EasyJet's plan to file a legal challenge next week comes after a similar move by Ryanair and IAG, which owns British Airways, to jointly complain to the Commission over its lack of action on the strikes.

The airline said costs for the full year would rise about 3% due to the disruption, which has so far been greater than during the whole of 2017.

Mr Lundgrun said: "It's been a challenging year so far and we estimate that this will not go away."

Optimistic outlook

EasyJet also warned that the long spell of hot weather in the UK and the World Cup could also affect demand for late bookings in the three months to 30 September.

However, the airline raised its full-year profit outlook to between £550m and £590m despite the impact of the strikes due to strong demand for seats.

It had previously estimated annual profits of between £530m and £580m.

Revenue for the third quarter rose 14% to £1.6bn, with revenues from baggage and seat allocation up more than a fifth to £328m.

The airline flew 24.4 million passengers - 9.3% more than the same period last year in the three months to 30 June.

Shares in EasyJet rose almost 3% to £17 in morning trading in London.

Richard Hunter at Interactive Investor, said the higher profit guidance should increase the dividend for shareholders.

He added: "Costs in general need to be tightly controlled in a notoriously cyclical industry, and easyJet will have its work cut out in keeping the lid on costs within its control in the event of a future downturn."

George Salmon at Hargreaves Lansdown said EasyJet was starting to benefit from self-help measures such as the "dramatic increase", but warned: "Operating costs and start-up losses from the recently acquired Air Berlin services are both higher than expected."

Losses at Berlin Tegel airport, where EasyJet has expanded rapidly after buying parts of Air Berlin following its collapse, will rise to £125m this year - £30m higher than its previous estimate.--BBC

Farnborough Airshow: Aston Martin unveils sports car for the skies

Luxury carmaker Aston Martin has unveiled plans for a personal aircraft dubbed a "sports car for the skies".

The company has teamed up with jet engine maker Rolls-Royce and engineering boffins at Cranfield University on the futuristic project.

A concept aircraft was unveiled at the Farnborough Airshow, but the consortium hopes to have a flying version ready for the next show in two years.

The three-seat hybrid-electric vehicle will be vertical take-off and landing.

Aston Martin, so associated with James Bond, dismissed suggestions it was a gimmick more likely to appear in 007 films than be seen flying commercially.

Rolls-Royce to develop flying taxi

May boosts aerospace amid Brexit fears

"Personalised and electric air transport is a fast-developing area and we need to start getting into it," said James Stephens, the company's director of global government.

A number of aviation and technology firms are hoping to make electric-powered small aircraft and air-taxis a reality, including Airbus, ride-sharing firm Uber, and a Google-backed firm called Kitty Hawk. Earlier this week, Rolls-Royce announced plans to develop a flying taxi engine, although the project with Aston Martin is separate.

Mr Stephens said Aston Martin wants to corner the market in next-generation luxury flying vehicles for the rich and famous. The aircraft would, he said, "be a sports car for the skies".

But it won't come cheap. The working price guide for the vehicle is put at between £3-5m

"We, in the UK, have the ability to develop this," Mr Stephens said. "The challenge is time, money and regulation. But the market will be there eventually."

'At the vanguard'

Called the Volante Vision Concept, the aircraft will feature autonomous technology and be able to hit speeds of up to 200mph.

Carl Bourne, Rolls-Royce's strategy and business development head, said the consortium rejected plans to build a flying car. "You'd end up with a bad aircraft, and a bad car."

He said the Volante would be pitched as an alternative way to escape urban congestion and quickly move between big towns and cities.

"Unlike a private plane, it will be vertical lift. Unlike a helicopter, it will cruise more efficiently," he said.

The consortium behind the Volante also includes aviation technology company Cranfield Aerospace Solutions.

It chief executive, Paul Hutton, said: "The introduction of autonomous and electric propulsion technologies into new aircraft designs is both inevitable and challenging."

But he said such projects put the UK consortium "at the vanguard of this revolution in aerospace".--BBC

Lift-off for Scotland: Sutherland to host first UK spaceport

A remote, boggy stretch of land on the north coast of Scotland is set to become the UK's first spaceport.

The A'Mhoine Peninsula in Sutherland has been chosen as the most suitable place from which to launch rockets vertically to put satellites in orbit.

The UK Space Agency is giving Highlands and Islands Enterprise £2.5m towards the development of the facility.

HIE will work closely with a consortium that includes the American aerospace giant Lockheed Martin.

The goal would be to have launches as early as possible in the 2020s.

Small rockets herald new wave

UK satellite makes HD movies of Earth

The Scotland money is part of a package of grants to foster UK launch capability that was announced by Business Secretary Greg Clark at the Farnborough International Air Show.

He told the event: "We are one of the best countries in the world for the research, development, manufacturing and application of satellites - big and small. And when we see the expansion that is taking place, and the requirement that these satellites need to be launched into orbit - there is an obvious opportunity here for the UK and it must be grasped."

Mr Clark detailed a total of £33.5m in grants from a reserved pot of £50m to help drive forward proposals.

Lockheed will get the lion's share at £23.5m. The company wants to bring the Electron rocket to Scotland. Currently, this vehicle flies out of New Zealand.

A British version of the rocket would have a propulsion unit and satellite dispenser developed and built at Ampthill in Bedfordshire, Harwell in Oxfordshire, and in Reading.

Patrick Wood is Lockheed Martin's senior executive in the UK. "As a country we've not invested in launch vehicles since 1971 and Black Arrow, which put up the Prospero satellite. I'm really proud to be working with the Lockheed Martin team and our partners in delivering the the first launch from British soil," he told BBC News.

HIE will develop the launch complex at A'Mhoine, with Lockheed using one pad, and a second pad likely to go to Orbex. This is a new company that has been developing a 17m-tall rocket out of the public eye.

On Monday, however, the firm was very forward in discussing its plans, which have now been backed through a UK Space Agency grant to the tune of £5.5m.

"We will be putting a new factory into Scotland where we will be doing the main production and integration of the vehicles. The vehicles will then be transported to Sutherland," explained Orbex CEO, Chris Larmour. "Internally, I don't think we realised just how big today is because we've been focussed on technical tasks. But this morning at the show, I think we're beginning to realise just how big a moment this is."

The UK government has been mulling the idea of home spaceports for a decade now, and has updated the legislation that would make them possible.

While the headline news focussed on Scotland and the launch of rockets from the ground, £2m has also been released to further investigations into the siting of a "horizontal launch" spaceport as well.

This would see a modified aeroplane leave a British runway, climb to altitude somewhere out over the ocean and then release a rocket that can put the satellite in orbit. A number of such systems are presently in development.

One making waves at the moment is owned by entrepreneur Sir Richard Branson. His Virgin Orbit company, based in Long Beach, California, has converted an old Virgin Atlantic 747 to dispense its LauncherOne rocket - a maiden flight for which is imminent.

Cornwall, in particular, is very keen to have Virgin Orbit operate out of Newquay airport. The council and the California company signed a partnership agreement at the air show. A first mission is being targeted for 2021.

"Cornwall is showing ambition," said Adam Painter, the leader of the council. "Years ago we sent miners around the world; we led the world in mining. That industrial time has gone but for Cornwall - we see that we have a number of new areas that we could excel in and space is one of them."

Why is this important?

The UK is in a unique moment. Having pioneered the development of small satellites, through companies such as Surrey Satellite Technology Limited and AAC Clyde Space, it has put itself right at the crest of a new wave. The use of off-the-shelf, low-cost, miniaturised consumer electronics is revolutionising satellites. It is now possible to put enormous capability inside a very small box. Having spaceports would allow UK industry to offer the full "turn key" product to their customers - from design, to build, to launch. The whole package.

Everything you can imagine. Satellites to monitor the weather, to relay communications, and to take pictures of activity on Earth. Small satellites can do all this and they tend to operate in polar-type orbits. That is, they circle the Earth a few hundred kilometres up, passing over the Arctic and the Antarctic. The north of Scotland is therefore ideally situated in this respect. Rockets would fly north, through the gap between Iceland and the Faroe Islands, and Svalbard. If there were launch failures, nothing would fall on populated land.

What sort of rockets?

I've mentioned three vehicles already that could fly from the UK - the Electron, Orbex and LauncherOne. But there are 60-plus small launch vehicles in development around the world. A few of these others are also based in the UK, and they will regard a home spaceport as a great fillip to their endeavours.

What happens next?

Keep an eye on the clock. Time is short for the UK if it wants to capture a significant share of the nascent small launch market. UK regional authorities and rocket operators are going to have to move fast if they want to avoid the opportunities drifting away to other countries. There is a big responsibility on government, too. It has updated legislation but many details still need to be tied down, such as liability rules and safety requirements. If these are made too onerous, it will put up the price of launching satellites. The cost per kilogram-to-orbit has to be competitive.

Chris Larmour told BBC News: "If we weren't in the position we are today with the components being fired, tested and running already - that window would not be possible for us; and I think that window is closing for people who are not in that degree of readiness."--BBC

UK unveils new Tempest fighter jet model

A model of the UK's planned new fighter jet, the Tempest, has been unveiled at the Farnborough Air Show.

The UK's Defence Secretary, Gavin Williamson, said the jet could be used with either pilots or as a drone.

The craft will eventually replace the existing Typhoon fighter jet. It will be developed and built by BAE Systems, engine maker Rolls-Royce, Italy's Leonardo and missiles expert MBDA.

Mr Williamson said the UK would be investing £2bn in the new project.

The hope is to see it flying by 2035.

Theresa May pledges to boost aerospace amid Brexit fears

Rolls-Royce to develop flying taxi

Mr Williamson said the programme was aimed at ensuring the UK's continued leadership in fighter technology and control of air space in future combat: "We have been a world leader in the combat air sector for a century, with an enviable array of skills and technology, and this strategy makes clear that we are determined to make sure it stays that way."

He added that the UK, currently excluded from the latest fighter programme underway between France and Germany, was not against forming a partnership with other nations: "It shows our allies that we are open to working together to protect the skies in an increasingly threatening future - and this concept model is just a glimpse into what the future could look like."

'Direction of travel'

According to BBC defence correspondent Jonathan Beale, the Tempest looks remarkably similar to the current generation of stealth jets, including the US developed-F 35.

Its sleek lines are designed to be hard to detect by radar, but unlike the current generation of jets it could also operate as a drone without a pilot.

It would also be the first British-designed jet to carry laser directed energy weapons capable of shooting down aircraft and missiles.

Aeropace giant Airbus welcomed the new jet programme: "Airbus welcomes the UK's commitment of funding for the future fighter project. We look forward to continuing collaborative discussions with all relevant European players."

Earlier, the chief executive of BAE Systems, Charles Woodburn, told the BBC's Today programme that the new jet would be some time in coming.

"We already have the Typhoon platform which forms the absolute bedrock of European air defence and that'll be in service for decades to come," he said.

He added that the inner workings of the new craft would start life within the Typhoon.

"The important thing about the new concept is that it will illustrate a direction of travel and many of those technologies that will be embodied in that will first see their service through the Typhoon.

"For example, upgrades on the avionics, upgrades in the weapons systems, upgrades in the radar will be deployed through the Typhoon and will be deployed there and then."--BBC

Google hit with €4.3bn Android fine from EU

Google has been fined a record €4.34bn ($5bn; £3.9bn) over Android.

The European Commission said the firm had used the mobile operating system to illegally "cement its dominant position" in search.

The firm's parent Alphabet has been given 90 days to change its business practices or face further penalties of up to 5% of its average global daily turnover.

It has said it plans to appeal.

However, it could easily afford the fine if required - its cash reserves totalled nearly $103bn at the end of March.

At a press conference in Brussels, Competition Commissioner Margrethe Vestager said consumers needed choice.

And she suggested the ruling could lead manufacturers to sell smart devices using different versions of the Android operating system to Google's, such as Amazon's Fire OS, which she said they had been prevented from doing.

"This will change the market place," she said.

Google's chief executive Sundar Pichai has blogged in response.

"Rapid innovation, wide choice, and falling prices are classic hallmarks of robust competition and Android has enabled all of them," he wrote.

"Today's decision rejects the business model that supports Android, which has created more choice for everyone, not less."

Sundar Pichai also released a video clip saying the ruling could "upset the careful balance of the Android ecosystem"

Ms Vestager previously fined Google €2.4bn ($2.8bn; £2.1bn) over a separate probe into its shopping comparison service - a ruling the tech firm is in the process of appealing against.

In addition, her team has a third investigation underway into Google's advert-placing business AdSense.

Ms Vestager alleges that there are three ways that Google has acted illegally:

it required Android handset and tablet manufacturers to pre-install the Google Search app and its own web browser Chrome as a condition for allowing them to offer access to its Play app store

it made payments to large manufacturers and mobile network operators that agreed to exclusively pre-install the Google Search app on their devices

it prevented manufacturers from selling any smart devices powered by alternative "forked" versions of Android by threatening to refuse them permission to pre-install its apps

Ms Vestager acknowledged that Google's version of Android does not prevent device owners downloading alternative web browsers or using other search engines.

But she said that only 1% of users downloaded a competing search app, and 10% a different browser.

"Once you have it, it is working, very few are curious enough to look for another search app or browser," she said.

What does the regulator want Google to do now?

The Competition Commissioner said that Google carried out its abuse at a time when the mobile internet was growing quickly, helping it ensure that its advertising-supported search service repeated the success it had already found on desktop computers.

She cannot turn the clock back, but said the size of the fine had been based on the firm's search-related earnings from Android devices in Europe since 2011.

She has, however, said the firm must now stop all of the practices outlined above and refrain from any measures with a similar goal.

Russia may give one example of how this could be achieved.

After similar complaints by the country's regulator, Google now offers Android users a choice between Google, Yandex and Mail.ru as the default search engine the first time they use the Chrome browser.

Yandex in particular has benefited from this.

Since the change in June 2017, the Moscow-based firm has seen its share of mobile search rise from about 34% to 46%, according to Statcounter.

What has the reaction been?

The European Commission first began scrutinising Android in April 2015, after a complaint by Fairsearch - a trade group that originally included Microsoft, Nokia and Oracle among its members.

It claims the case has dragged on for so long because Google had used "every trick in its book to delay action".

But the group welcomed the commissioner's intervention.

"This is an important step in disciplining Google's abusive behaviour in relation to Android", said spokesman Thomas Vinje.

"It means that Google should cease its anti-competitive practices regarding smartphones, but also in other areas - smart TVs in particular - where it is foreclosing competition by using the same practices."

A trade body representing mobile operators has also greeted the development.

"This will enable consumers to benefit from a greater choice of mobile services, and allow more players to innovate and offer new services in the market," said the GSMA's chief regulatory officer John Giusti.

How has the EU punished others?

The European Commission had the power to fine Google up to 10% of its annual revenue. Based on its last annual report, that would have amounted to a maximum of $11.1bn (£8.5bn).

The €4.3bn figure is, however, a record-sized sum for the commission.

Earlier punishments include:

1.   fines totalling €3.8bn against several truck-makers accused of price collusion, which were imposed in July 2016 and September 2017

2.   the €2.24bn fine against Google for promoting its own shopping comparison service at the top of its search results, which was announced in June 2017

3.   two fines totalling €1.46bn against Microsoft related to the bundling of its Explorer browser with Windows, and failing to keep a pledge to provide users with a choice of other browsers. The two penalties were announced in February 2008 and March 2013

4.   a €1.35bn collective fine against several car glass producers, which had been accused of illegally sharing commercially sensitive information. This was made in November 2008

5.   a €1.06bn fine against Intel, which was accused of offering discounts to computer-makers that avoided rivals' computer chips. It was announced in May 2009

6.   a €997m fine against Qualcomm, which was penalised over claims it had paid Apple to use its chips. This was announced in January 2018

Depending on your point of view, Margarethe Vestager is either the only global regulator really standing up to arrogant American tech giants - or a busybody trying to hobble innovative businesses because Europe can't build its own.

But today's ruling shows the gulf that has opened up between US and European competition policies.

In the States the focus is on real and obvious harm to consumers in the form of higher prices or less choice. They also seem more sympathetic to the tech giants' argument that they can be easily toppled from their perches by feisty start-ups.

European regulators tend to take a wider view of markets, worrying about a "winner takes it all" world, where a few mighty platforms appear to offer consumers a shiny world of free or very cheap goodies, but in reality are devoted to crushing any competition.

This culture clash isn't going to fade away any time soon.

Cheered on by many who are concerned about Silicon Valley's dominance, Ms Vestager will not abandon her mission to tame the tech giants - and the likes of Google, Apple and Amazon will fiercely resist any regulation that they see as a threat to their lucrative business models.--BBC

Summer clothing sales hold back inflation

Inflation remained at 2.4% for the third month in a row in June, according to the Office for National Statistics, after clothing prices fell.

The Consumer Price Index (CPI) measure of inflation had been expected to rise to 2.6% last month.

However, the summer sales weighed on inflation after clothing prices were cut, in particular on men's fashion.

The unchanged figure means that wages remain above inflation despite pay growth slowing to 2.7%.

The pound fell against the dollar following the surprise reading, slipping 0.60% to $1.3037.

There had been expectations that the Bank of England would raise interest rates in August.

But Ben Brettell, Senior Economist, Hargreaves Lansdown, said that June's figure meant it is not "a done deal".

He said: "Markets had been pricing in around an 80% chance the Bank would lift borrowing costs in August, but today's inflation data combined with yesterday's lacklustre wage growth figures could force policymakers into a rethink."

Neil Wilson, chief market analyst at Markets.com, said: "The Bank of England's policymakers seem to be guiding a hike and the market has quietly acquiesced but data this week does not support the case for an imminent raising of rates.

"My bet is the Bank will - as in May - be forced by softer data to be forced away from raising rates too quickly."

Summer sales

The ONS said that the price of clothing and footwear fell by 2.3% between May and June compared to a 1.1% decline in the same period last year.

While it said it was normal for prices to drop at this time of year due to the start of the summer sales season, the ONS said the fall was the largest since 2012 and "the effect came mainly from men's clothing".

The price of computer games also fell. The ONS said: "Prices for these games are heavily dependent on the composition of bestseller charts, often resulting in large overall price changes from month to month."

However, the cost of motor fuel and household energy prices rose to keep inflation steady.

Petrol prices rose by 2.7p per litre to 128p between May and June 2018 - the highest average price since September 2014.

Diesel prices also rose, up 2.9p to 132.1p. Both petrol and diesel prices fell between May and June last year.

Mike Hardie, head of inflation at the ONS, said: "Consumers have been feeling the benefit of the summer clothing sales, and computer game prices have also fallen.

"However, gas and electricity and petrol prices all rose, with consumers seeing the highest price at the pump for nearly four years, with inflation remaining steady overall."--BBC

INVESTORS DIARY 2018

Company

Event

Venue

Date & Time

NicozDiamond

shares delist from the ZSE

06/07/2018

Zimbabwe

Heroes’ Day

Zimbabwe

13/08/2018

Zimbabwe

Defence Forces Day

Zimbabwe

14/08/2018

The Harare Agricultural Show

The Harare Agricultural Show

The Harare Agricultural Show

August 27- September 1

 <mailto:info at bulls.co.zw> 

DISCLAIMER: This report has been prepared by Bulls ‘n Bears, a division of Faith Capital (Pvt) Ltd for general information purposes only and does not constitute an offer to sell or the solicitation of an offer to buy or subscribe for any securities. The information contained in this report has 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 report shall be solely responsible for making their own independent 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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