Major International Business Headlines Brief::: 29 April 2019

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Major International Business Headlines Brief::: 29 April 2019

 


 

 


 <http://www.nedbank.co.zw/> 

 


 

 


 

 

*  Abu Dhabi fund deposits $250 mln in Sudan c.bank - WAM

*  Libya's NOC says it strongly condemns militarisation of energy
infrastructure

*  Kenya secures $666 million from China for tech city, highway

*  Guinea boosts power output to foster bauxite refining

*  Sudan signs $200 mln loan with Kuwait-based fund

*  Nigeria and Saudi Arabia to draft MoU on oil and gas -Nigeria oil
ministry

*  South Africa's rand strengthens slightly ahead of U.S. growth data

*  Total profits hit by volatile oil prices despite record output

*  Sierra Leone's fishing ban to replenish stocks yields little

*  South Africa's Pick n Pay posts 18 pct jump in full-year earnings

 


 <mailto:info at bulls.co.zw> 

 


 

                                      


Abu Dhabi fund deposits $250 mln in Sudan c.bank - WAM

DUBAI (Reuters) - The state-funded Abu Dhabi Fund for Development deposited
$250 million in Sudan’s central bank as part of a previously-announced
grant, state news agency WAM said on Sunday.

 

The deposit was part of the $3 billion grant to Sudan announced by the
United Arab Emirates and Saudi Arabia earlier this month.

 

 

 

 

 

 

 

 

 


 <mailto:info at bulls.co.zw> 

 



Libya's NOC says it strongly condemns militarisation of energy
infrastructure

CAIRO (Reuters) - Libya’s National Oil Corporation (NOC) condemned the
militarisation of the country’s energy infrastructure, following a number of
incidents in the past week involving the capture of an airfield, the
attempted requisition of tug boats, and use of oil terminals by warships and
other military vessels, it said on a statement on Saturday.

 

“This illegal and irresponsible activity is a gross violation of our
civilian mandate and must stop. These acts endanger workers, diminish
partner confidence, and threaten our ability to maintain operations. NOC
rejects all attempts to use corporation equipment and facilities for
military objectives”, NOC Chairman Mustafa Sanalla said .

 

 

 

Kenya secures $666 million from China for tech city, highway

NAIROBI (Reuters) - Kenya has secured 67.5 billion shillings ($666 million)
in funding from China to build a data centre in a tech city currently under
construction and a highway in Nairobi, the president’s office said on
Friday.

 

Kenya has turned to China over the past few years for funds, technology and
equipment to develop its infrastructure, including its biggest project since
independence, a new railway linking Mombasa to Nairobi, opened in 2017.

 

The new funding will consist of loans at low interest rates and partnerships
with private firms. The tech city will be built in Konza, about an hour’s
drive from Nairobi.

 

Chinese telecoms firm Huawei [HWT.UL] will develop the Konza project at a
cost of 17.5 billion shillings, according to the statement from President
Uhuru Kenyatta’s office. It was issued from Beijing, where Kenyatta is
attending the second Belt and Road Forum.

 

The remaining 50 billion shillings will go to build a highway in the capital
linking the main airport with the suburbs, to be carried out by China Road
and Bridge Corporation at a cost of 51 billion shillings.

 

Critics accuse Kenyatta’s government of saddling future generations with
unbearable debt burdens by borrowing more funds from China. The government
says borrowing to build the infrastructure will spur economic development.

 

($1 = 101.4000 Kenyan shillings)

 

 

 

Guinea boosts power output to foster bauxite refining

CONAKRY (Reuters) - Guinea expects to boost its energy production capacity
by nearly four-fold over the next six years as it pushes mining companies to
refine their bauxite output locally, the energy minister said on Friday.

 

The West African nation, Africa’s biggest producer of the aluminium ore, is
in the midst of a mining boom that has seen bauxite output explode, mainly
on the back of demand from China. It now accounts for more than half of
China’s bauxite imports.

 

Seeking to use the mining sector to fuel economic development, the
government is pressuring mining companies to commit to building facilities
that will refine bauxite into higher value alumina, which is used in
smelters to produce aluminium.

 

“Mines are, quite simply, development. And the mines can’t develop without
energy,” Cheick Taliby Sylla said on the sidelines of a mining conference in
Guinea’s capital, Conakry.

 

Guinea currently has power production capacity of just 658 megawatts. Much
of the country has no access to electricity, and even the capital
experiences frequent blackouts.

 

Experts have therefore questioned the feasibility of establishing a
power-thirsty refining sector.

 

 

But Sylla said several projects in the pipeline will significantly boost
output in the near future.

 

“By 2025, we will have around 2,600 megawatts in terms of total production,”
he said. “We can dedicate a quantity to (the mining companies) ... We will
guarantee that supply of energy.”

 

The 450-megawatt Souapiti hydro-electric dam is the first large-scale
project expected to enter production. The dam, which is being built by China
Water Electric with $1.3 billion in financing from China Exim Bank, will go
online next year.

 

Sylla said 1.3 billion cubic meters of water will be directed into the dam’s
reservoir during the country’s rainy season later this year. Around 15,000
people are being displaced by the project.

 

Guinean Mines Minister Abdoulaye Magassouba said the increased power
availability should drive companies to stick to the refining timetables set
out in their agreements with the government.

 

“There are contractual obligations that were entered into freely by mining
companies,” he said. “We plan to respect to our commitments. And we expect
our partners to respect their commitments.”

 

SMB - a consortium of Singapore’s Winning International Group, the world’s
top aluminium producer China Hongqiao and Guinea’s UMS International - will
begin construction of a refinery later this year.

 

The facility, which will be capable of producing 1 million tonnes of alumina
annually, is part of a $3 billion upgrade that also includes a 135-kilometre
(84-mile) railway.

 

 

 

Sudan signs $200 mln loan with Kuwait-based fund

KHARTOUM (Reuters) - Sudan has signed a deal for a $200 million loan from
the Kuwait-based Arab Fund for Economic and Social Development, state news
agency SUNA reported on Saturday.

 

The loan would be used to support development projects in Sudan, SUNA said
without giving further details.

 

Sudan’s economic crisis helped trigger mass protests that led to the ouster
of former President Omar al-Bashir earlier this month. The country of 40
million has been suffering from rapid inflation and shortages of cash, fuel
and other basic products.

 

A transitional military council took over from Bashir. Demonstrations have
continued as protesters call for a rapid handover of power to civilians.

 

 

 

Nigeria and Saudi Arabia to draft MoU on oil and gas -Nigeria oil ministry

ABUJA (Reuters) - Nigeria and Saudi Arabia plan to draft a memorandum of
understanding on an oil and gas partnership that could lead to the
construction of a new refinery and investments in liquefied natural gas,
Nigeria’s petroleum ministry said on Friday.

 

Nigeria imports the bulk of its petrol, despite being Africa’s biggest crude
oil producer, due to its dilapidated refineries. Last month, Nigeria’s state
oil company said it was in talks with different consortiums to overhaul its
refineries and save billions of dollars on fuel imports.

 

Nigeria’s petroleum ministry, in a statement issued days after oil minister
Emmanuel Kachikwu held talks with Saudi energy officials, said an early
draft of a memorandum of understanding would be ready in the first week of
May.

 

“Areas of interest will cover the existing refinery revamp, building of a
brand new refinery, LNG investments and product supply trading in crude and
refined products,” the ministry said in the statement.

 

It added that Saudi energy minister Khalid Al-Falih had reiterated the
possibility of establishing an independent refinery in Nigeria, considering
it the best hub from which to reach other African countries.

 

Saudi Aramco is expanding its downstream operations such as refining and
petrochemicals production as part of its drive to become the world’s largest
integrated energy firm.

 

 

 

South Africa's rand strengthens slightly ahead of U.S. growth data

JOHANNESBURG (Reuters) - South Africa’s rand strengthened slightly against
the dollar on Friday with other emerging markets, but its gains were capped
by a strong dollar ahead of U.S. growth data.

 

At 0655 GMT the rand was 0.42 percent stronger at 14.3800 per dollar
compared with an overnight close of 14.4400.

 

“In tandem with emerging market currencies, the rand struggled to gain
traction against a strong greenback as the trade-weighted US dollar
continued to benefit from positive data releases,” said NKC African
Economics in a morning note.

 

The currency market’s focus is now on the U.S. GDP data, which could
reinforce bullishness about the world’s top economy after a slew of numbers
this week pointed at an improved outlook. [nL3N2281G0]

 

NKC African Economics said it expects the rand to trade between 14.25 and
14.50 rand to the dollar.

 

South African-focused investors will look to any election news ahead of
parliamentary and provincial polls on May 8.

 

In fixed income, bonds also weakened the yield on the benchmark 10-year
issue was up 1 basis points to 8.600 percent.

 

 

 

Total profits hit by volatile oil prices despite record output

PARIS (Reuters) - French energy major Total said its net profit for the
first three months of the year fell 4 percent to $2.8 billion compared with
a year ago due to volatile oil prices and debt costs, despite record oil and
gas output.

 

The firm kept its investments, and cost savings target for the year
unchanged, and said production growth should exceed 9 percent during the
year, thanks to the ramp-up of projects started in 2018, and the start-ups
of others in Angola, Brazil, Britain and Norway.

 

It said it would take advantage of the low cost environment to launch
further projects in Brazil, Uganda and Russia.

 

Total shares were a touch down 0.4 in early session trading, with the stock
up nearly 10 percent so far in 2019.

 

“A decent start to the year,” wrote analysts at RBC Capital Markets on
Total’s results, as they kept an “outperform” rating on the stock.

 

Total’s adjusted net profit, which was down for the first time since the
fourth quarter of 2016, was hit by lower oil prices, with the Brent price
averaging $63 per barrel in the January to March period, down 6 percent
year-on-year.

 

The adjusted net profit was nevertheless slightly above average analysts’
forecast of $2.7 billion, while Total also raised its dividend.

 

Natural gas prices slumped in Europe by 11 percent, and in Asia by 30
percent, Total said.

 

The company said an increase in the net cost of its net debt compared with
last year, mainly due to the rise in U.S. dollar interest rates, had also
weighed on its profits.

 

Its refining margin was also volatile during the quarter, the company said.

 

“Total’s balance sheet is strong, with gearing below 20 percent, in line
with the objective,” said Total’s chairman and chief executive Patrick
Pouyanne.

 

Total’s cash flow after organic investments rose 18 percent year-on-year to
$3.2 billion thanks to strong operational performance and spending
discipline. Its so-called organic pre-dividend cash breakeven was less than
$25 per barrel.

 

Oil and gas output reached a record level in the quarter at 2.95 million
barrels of oil equivalent per day (Mboe/d), up 9 percent year-on-year.

 

Total increased its first interim dividend for 2019 by 3.1 percent to 0.66
euros ($0.7350) per share, and it also bought back shares during the
quarter.

 

The French group said it would maintain discipline on spending in 2019 and
it kept its net investment target at $15 to $16 billion, and cost savings at
$4.7 billion.

 

VOLATILE ENVIRONMENT

Since the start of the second quarter, the Brent oil price has traded at
around $70 per barrel with disruptions in Venezuela, uncertainty in Libya
and compliance with OPEC production quotas providing some support to the
price.

 

Nevertheless, Total said the environment remained challenging.

 

“The environment remains volatile, however, with uncertainty around the
evolution of non-OPEC supply and the impact of global economic growth on
demand,” said Total. ($1 = 0.8979 euros)

 

 

Sierra Leone's fishing ban to replenish stocks yields little

TOMBU, Sierra Leone (Reuters) - Sierra Leone is nearing the end of a
one-month ban on industrial fishing that local fishermen hoped would
replenish stocks but whose impact has been limited by its short span and the
financial muscle of foreign companies.

 

Artisanal fishing boats anchor across the channel from an iron ore loading
terminal run by mining company African Minerals in Sangbulima, Sierra Leone,
November 18, 2012. REUTERS/Joe Penney

    The government imposed the moratorium at the start of April on
industrial boats, most of which are owned by Chinese and South Koreans.
Local fishermen complain that these trawlers damage their nets and disrupt
schools of fish in shallow water.

 

    West Africa is in the midst of an overfishing crisis as foreign
companies pour into the region to meet increasing demand for fishmeal and
tropical fish, particularly from Asia.

 

    “We consulted with many experts and environmentalists and believe one
month without them should be enough time to help replenish our stocks,”
Ibrahim Turay, the country’s Deputy Minister of Fisheries, said in an
interview earlier this month.

 

But advocacy groups say one month is too short to make a major impact, and
that regional governments need to bolster their policing of illegal fishing,
which Greenpeace estimates costs West African governments more than $2
billion per year.

 

“The fact that there is a measure to try and reduce the pressure on
resources is salutary, but this is insufficient,” said Ibrahima Cisse,
senior oceans campaign manager for Greenpeace Africa. “The means at the
disposal of the department in charge of surveillance are very weak.”

 

Turay declined to comment this week when asked if the ban had been
successful.

 

FOREIGN COMPETITION

Nor does the moratorium, which also requires that fish be sold exclusively
on local markets during the month-long period, appear to be shielding local
fishermen from foreign competition, as many had hoped.

 

Fishermen working the bustling Tombu harbour, lined with plastic buckets and
jerrycans filled with the day’s catch of croaker, told Reuters that fluid
seasonal migration patterns made it hard to judge whether fish stocks were
recovering.

 

But several said big trawling firms seemed to have responded to the ban’s
announcement in March by stepping up their use of what the fishermen
describe as predatory lending schemes that allow the companies to secure
local fishermen’s entire catches.

 

According to fishermen and harbour management staff, fishermen must
reimburse the loans, which go toward nets and other expensive equipment,
with their daily catch, which the companies undervalue by as much as a
factor of four.

 

Many local fishermen say they have great need for such loans, often to
replace nets damaged by the trawlers.

 

One such contract seen by Reuters between a fisherman and a South
Korean-owned company called Chung Gang Fishing was signed on March 13, three
days after the ban was formally announced. It gives the company exclusive
rights to anything the fisherman catches until he has paid back a $600 loan.

 

Chung Gang Fishing representatives declined to comment.

 

    “There’s no other way that I can have so much cash in my hand at once,
so of course I’m not going to say no,” said Sheik Sawyer, a Tombu fisherman
who is still repaying a $700 loan he took out from a Chinese firm last
month.

 

 

 

South Africa's Pick n Pay posts 18 pct jump in full-year earnings

JOHANNESBURG (Reuters) - South African retailer Pick n Pay Stores Ltd on
Friday reported an 18 percent jump in full-year earnings, as price cuts
helped it attract highly cost-conscious shoppers and cope with the difficult
trading conditions that have hit other retailers.

 

The country’s second largest grocery store chain, which pitches itself as a
more affordable alternative to the likes of Woolworths and Shoprite’s
Checkers, said headline earnings per share (HEPS) were at 326.71 cents
($0.2274) for the 52 weeks to end-February, compared with 276.98 a year
earlier.

 

HEPS is the main profit measure in South Africa that strips out certain
one-off items.

 

In a statement, Pick n Pay CEO Richard Brasher thanked his staff for
delivering an “outstanding result in a difficult economy”, attributing
success to price cuts and efficiency gains.

 

“This result is built on a clear, long-term strategy to create a leaner and
more cost-effective business,” he said, adding that Pick n Pay will also
have good years in 2019 and beyond.

 

Other retailers have struggled amid a slump in retail sales as South African
consumers cut back to cope with high household debts, a tax increase and
higher prices on basics like fuel. Currency devaluations and trading
conditions in markets elsewhere on the continent also hurt.

 

Pick n Pay said the conditions in countries including Botswana, Zambia and
Zimbabwe had been challenging, dragging its earnings from the rest of the
continent down 16.2 percent.

 

However, this was offset at home, where the company said its Pick n Pay and
budget Boxer stores saw turnover rise at a “market-leading” rate of 7.1
percent.

 

In 2018, the retailer opened 130 stores and revamped 103. Pick n Pay follows
a 52-week retail financial calendar, which requires inclusion of an
additional week every six years. Including the earnings for this extra week,
HEPS rose by 25.2 percent.

 

($1 = 14.3809 rand)

 

 

 

 

 

 

 

 

 

 

 


 

 


 

INVESTORS DIARY 2019

 


Company

Event

Venue

Date & Time

 


 

 

 

 

 


 

Workers Day

 

01 May  2019

 


 

Africa Day

 

25 May 2019

 


 

 

 

 

 


 

 

 

 

 


 

 

 

 

 


 

 

 

 


 

 

 

 


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