Major International Business Headlines Brief::: 29 August 2019

Thu Aug 29 03:17:09 CAT 2019

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Major International Business Headlines Brief::: 29 August 2019

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*  S.Africa's Eskom may need more bailouts if funding plan fails

*  Kenya anti-graft body EACC suspends planned merger of Telkom Kenya, Airtel Kenya

*  South Africa's rand dips as investors tread cautiously, stocks up

*  Sasol says U.S. ethane cracker production steps up

*  Adcock Ingram posts higher FY profit, unloads Ghana investment

*  Dis-Chem benefits from medicine price hike

*  Distell turned off crisis-hit Zimbabwe

*  Bidcorp says UK logistics unit sale nearing completion

*  Kenya's Nation Media Group says H1 2019 pretax profit falls 24%

*  Namibia’s central bank forecasts deeper economic contraction in 2019

*  Trade war drives ‘innocent’ Asian nations towards recession

*  Thomas Cook to sell majority stake to China's Fosun

*  Apple 'sorry' that workers listened to Siri voice recordings

*  US still to grant any Huawei trade licences

*  Costco forced to shut first China store early due to crowds

*  Pound volatile as Parliament to be suspended in September

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S.Africa's Eskom may need more bailouts if funding plan fails

CAPE TOWN (Reuters) - The South African government may be forced to inject more money into state power firm Eskom by the end of March if the struggling utility fails to meet its borrowing plan, a Treasury official told parliament on Wednesday.

Eskom supplies more than 90% of South Africa’s electricity but does not generate sufficient cash to meet its debt-service costs and relies on state bailouts to stay afloat.

Plant outages this year led to some of the worst blackouts in years in South Africa and ratings agencies regularly cite Eskom as one of the biggest threats to South Africa’s investment-grade credit rating status.

The Treasury has already earmarked 26 billion rand ($1.7 billion) to Eskom in the financial year which ends in March 2020 as part of special legislation to inject 59 billion rand over two years. That is on top of a 23 billion rand a year bailout for the next three years.

“Failure to execute its funding plan may result in Eskom experiencing liquidity shortfalls at 31 March 2020 and require additional funding in addition to funding provided through the Special Appropriation Bill,” the National Treasury’s director general, Dondo Mogajane, told lawmakers.

The government plans to restructure, or “unbundle”, the huge organisation into separate generation, distribution and transmission units. It is also exploring debt relief options including the state taking on Eskom debt, while a policy discussion paper published on Tuesday raised the idea of selling Eskom’s coal-fired power plants.

Mogajane also outlined some of the conditions the Treasury was considering imposing on Eskom, a key concern for investors who want to see evidence officials will follow through on promises to reform the utility.

Those conditions could include having Eskom use state financial support to pay off debt and interest, rather than paying bonuses. If Eskom intends to use bailout money for other reasons pre-approval could be required.

Eskom could also need to submit a schedule of debt redemptions, report daily to the Treasury on liquidity issues and sell its mortgage-lending unit, Mogajane said. “There will be more stringent ones (conditions), one can imagine,” he added.

Mogajane said the government’s financial support to Eskom, whose ballooning debt has reached 440 billion rand, was premised on its ability to execute its funding plan of 46 billion rand for 2019/20, with 58% already secured.

U.N. WARNING

Separately, a United Nations climate official sounded a warning on Wednesday about the impact Eskom was having on Africa’s most industrialised economy.

“You’ve seen the shedding of government bonds by international bondholders because they are concerned about the effect Eskom might have on the economy,” Rachel Kyte, a special representative of UN Secretary-General Antonio Guterres, told reporters via videolink during a discussion on climate change.

“It’s a very clear example that people do not want to be exposed to a heavily intensive carbon portfolio.”

Eskom generates most of its power from heavily polluting coal-fired power plants, some of which are nearing the end of their commercial lives.

“How government manages the (Eskom) situation, and the extent to which it attracts investment into clean energy, the extent to which unbundling has to be part of that solution, are things that we are watching closely,” Kyte added.

($1 = 15.2369 rand)

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Kenya anti-graft body EACC suspends planned merger of Telkom Kenya, Airtel Kenya

NAIROBI (Reuters) - Kenya’s anti-graft Ethics and Anti-Corruption Commission (EACC) has suspended a planned merger of Telkom Kenya and Airtel Kenya pending a probe into misappropriation of funds at Telkom, an EACC spokesman said.

India’s Bharti Airtel had said in February its unit Airtel Networks Kenya Ltd had agreed to merge with Telkom Kenya Ltd, the East African nation’s smallest telecom operator.

Three industry sources told Reuters in January that Bharti Airtel was in talks to buy Telkom Kenya to create a stronger challenger to market leader Safaricom.

“They are conducting investigations into allegations of misappropriation of public funds in the process of privatisation, recapitalisation and restructuring of balance sheets of Telkom Kenya limited,” EACC spokesman Yassin Amaro said.

Neither Telkom nor Airtel were immediately available to comment.

Telkom was privatised in 2007 when French telecoms operator Orange bought a majority stake, which was subsequently sold to Helios in 2015.

“We are interested on how this public entity is enjoining the other private party and how it is safeguarding the interest of taxpayers,” Amaro said.

He added that the investigation was restricted to Telkom Kenya and did not give a timeframe for when they expect the investigation to complete.

At the time the deal was announced, Airtel said the deal will not involve Telkom Kenya’s extensive real estate holdings and some government contracts for unspecified services.

No timeframe was been given for the deal, and both companies were expected to operate as normal until the transaction is completed.

South Africa's rand dips as investors tread cautiously, stocks up

JOHANNESBURG (Reuters) - South Africa’s rand slowed slightly on Wednesday as traders continued to tread cautiously with an eye on global developments, while stocks strengthened.

At 1523 GMT the rand was 0.16% weaker at 15.360, barely moved from its overnight close after some demand from exporters saw it stretch to a session best 15.2350.

“USD/ZAR is trapped at 15.30, with a strong bias for further weakness given both the fickleness of market sentiment toward trade talks and the lack of positive data to neutralise the negative tone on...global growth,” said Nema Ramkhelawan-Bhana, head of RMB Global Market Research.

The currency has struggled for momentum in either direction this week with a lull in local political developments offsetting the swings in the trade spat between Washington and Beijing.

With technical resistance below 15.20 remaining elusive and support at 15.50 equally far-off, the rand is set to be driven by month-end flows before fundamentals kick in next week with a batch of key data releases including second quarter growth figures.

In fixed income, bonds were also marginally firmer, with the yield on the benchmark 10-year government issue sliding 0.25 basis points to 8.195%.

On the bourse, stocks strengthened with the broader All-share index up 0.67% to 54,256 points, while the Top-40 rose 0.58% to 48,429 points.

South African pharmaceutical firm Adcock Ingram Holdings Ltd rose 4.86% to 58.20 rand after reporting a 10.6% rise in full-year earnings and the disposal of its investment in Ghana.

Further gains were seen in the platinum sector , up 4.67%, boosted by an increase in the platinum spot price.

Anglo American Platinum gained 5.76% to 894.27 rand and Impala Platinum rose 4.07% to 83.37 rand.

Sasol says U.S. ethane cracker production steps up

JOHANNESBURG (Reuters) - South Africa’s Sasol said on Wednesday its U.S. ethane cracker plant was now producing enough ethylene for use, bringing it a step closer to completing its Lake Charles Chemicals Project that has been hit by delays and cost hikes.

“With the first three units commissioned, plants representing more than 60% of the project’s total output are now online,” said Bongani Nqwababa, Sasol’s joint CEO and president.

Sasol - the world’s biggest maker of motor fuel from coal - said it would focus on improving the ethylene quality as well as the ramp up at the cracker unit, which was currently operating at 50% capacity.

The company expects to have the remaining units in the project up and running by the first quarter of 2020, Nqwababa said.

The ethylene produced in the facility will be used in six downstream plants on site to produce a range of derivatives.

Sasol delayed the release of its annual financial results earlier this month due to possible “control weaknesses” at the LCCP project, sending shares in the chemicals and energy company sharply lower.

The project in Louisiana, which will convert natural gas into the plastics ingredient ethylene, was initially expected to cost $8.9 billion in 2014 and has seen delays and cost increases.

Adcock Ingram posts higher FY profit, unloads Ghana investment

JOHANNESBURG (Reuters) - South African pharmaceutical firm Adcock Ingram Holdings Ltd said on Wednesday full-year earnings rose 10.6% and that it disposed of its investment in Ghana.

Headline earnings per share from continuing operations for the year ended June 30 rose to 421.7 cents from a restated 381.3 cents in the previous year.

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HEPS is the most widely watched profit gauge in South Africa and strips out certain one-off items.

The company said in a statement that it had disposed of its investment in Ayrton Drug Manufacturing Ltd, its associate in Ghana, as its performance did not meet expectations.

Adcock Ingram, which also has operations in India, said revenue rose 11% to 7.1 billion rand ($465.97 million).

($1 = 15.2369 rand)

Dis-Chem benefits from medicine price hike

JOHANNESBURG (Reuters) - South African drugstore chain Dis-Chem Pharmacies Ltd said on Wednesday that its revenues rose 13.5% in the five months through July, thanks to an increase in medicine prices and a jump in wholesale revenues.

Dis-Chem, which competes with Clicks Group, said revenue from March 1 to July 31 rose to 9.9 billion rand ($650 million).

Retail sales rose by 12% to 9 billion rand, with comparable sales growth of 5.3%, helped by a 3.78% increase in medicine prices which came into effect in March.

The company had been hit by prolonged strike action from November last year to March this year over workers’ wage demands, which led it to miss earnings expectations for its full fiscal year that ended in February.

On Wednesday it flagged one-off costs such as a change in the firm’s bonus policy, strike-related costs and an unearned rebate, which will negatively impact the first-half earnings for the financial year 2020.

Its shares, however, were up 3.3% at 21.43 rand after Wednesday’s trading update as investors were encouraged by the revenue growth.

Dis-Chem has been investing in technological and innovative ways to drive dispensary volumes such as click-and-collect services and partnering with FNB bank, which allows customers to order prescription medicine by using the FNB App.

As a result, it said it saw marginally improved trading volumes driven by strong dispensary trade.

“We are pleased to see that the group delivered strong revenue performance in a tough economic environment with increased competition and a constrained consumer,” Chief Executive Ivan Saltzman said in a statement.

“I am extremely satisfied with the rationalisation of stock levels post the strike and SEP buy-in, as we focus on improving free cash flow ensuring we require less net working capital investment which will better enable us to fund future growth strategies.”

SEP refers to the Single Exit Price mechanism in South Africa that lists the maximum price that a medicine can be charged by dispensers.

To date, the company has added nine new stores and is on track to add another 13 stores before year-end, it said.

Wholesale revenue increased by 15.3% to 6.8 billion rand, with sales to independent pharmacies and The Local Choice (TLC) franchisees up by 49% and 27.7% respectively, mainly due to the Western Cape wholesaler acquisition in November 2018 and a growing TLC customer base.

“With national warehouse representation now enabling us to access the independent pharmacy markets in the Western Cape and KwaZulu-Natal, we will continue to focus on growing the TLC and independent customer bases,” the firm said.

($1 = 15.2369 rand)

Distell turned off crisis-hit Zimbabwe

JOHANNESBURG (Reuters) - South African alcoholic drinks firm Distell is likely to hold off on further investments in Zimbabwe until there are signs it is tackling is deep economic problems, Chief Executive Richard Rushton said on Wednesday.

He had said earlier this year that if an opportunity arose to invest further in the country the company would look at it favourably, but since then soaring inflation, shortages of basic goods and foreign currency and other problems have worsened.

“It would take a brave individual right now to invest,” Rushton told Reuters by phone after the company reported that its full-year profits had dropped by 1.8% partly because of problems in the country.

While Distell is committed to the long-term opportunity the country offers, he said it wants to see an improvement in currency flows and a plan of action to address the issues Zimbabwe faces coming to fruition before it invests further.

The company is striving to become Africa’s premier drinks brand via an ambitious expansion plan focused on the continent.

While this offers attractive growth prospects, it also exposes it to risks as it pushes into Africa’s tougher markets.

Its headline earnings per share - the main profit measure in South Africa that strips out certain one-off items - stood at 656.4 cents ($0.4308), compared with 688.2 cents in the previous year.

The company’s shares fell 4.7% at market open but recovered quickly and were 0.15% lower by 0717 GMT.

ANGOLA PROMISING

Distell had warned earlier in August its profits could drop as much as 6% after an around 50% plunge in the value of the Angolan kwanza and a 266.1 million rand credit loss provision related to its Zimbabwean business.

Zimbabwe brings in the eighth-largest share of revenue on the continent excluding South Africa, but its contribution is in the low single digits below Kenya, Namibia and Botswana amongst others.

Throughout the continent excluding South Africa, sales volumes were up 10.3%, driven by markets such as Kenya, Nigeria and Ghana. Rushton said growing further in Kenya, and using this as a base for east Africa, was a priority.

While currency issues in Angola were ongoing and had been painful, he said Distell saw promising signs from the government in Luanda and this remained an important market.

In its South African home market, sales volumes were down 0.9%.

The country’s economy suffered its worst economic contraction in a decade in the second quarter, but Rushton said the decline was due to the impact of a drought on its wine business, which had to make above-inflation price increases, with other products resilient.

International sales volumes were down 10.6%, which according to Distell was in line with its strategy to shift away from lower-margin products and move towards premium wine and spirits.

The company said its international business would operate as three business units - international spirits, exports and premium wine - going forward to increase specialisation.

Distell has also been on a drive to restructure and optimise its operations. This led to 223.3 million rand of retrenchment and other related costs in the year.

($1 = 15.2369 rand)

Bidcorp says UK logistics unit sale nearing completion

JOHANNESBURG (Reuters) - South African food services firm Bid Corporation Ltd (Bidcorp) said on Wednesday the sale of its UK logistics business was back on track and nearing completion, which would allow the group to focus on its main operations.

Bidcorp, which operates in Europe, United Kingdom, Australasia and emerging markets, has been trying to sell the loss-making UK Contract Distribution business for more than a year. In September, a potential unidentified buyer ditched plans to acquire the non-core unit.

The group said in its annual results statement that the sale was “hopefully nearing finalisation” but did not give details.

“We are optimistic that the distraction of dealing with the discontinued operations will be behind us into financial year 2020, enabling the group to be fully focused on its core foodservice markets,” it said.

Its UK PCL distribution unit’s dairy business also ceased operating in April when it was acquired by Scandinavian dairy firm Arla Foods, Bicorp said.

In the year to June 30, Bidcorp spent 847.1 million rand ($55.60 million), compared with 1.2 billion rand in 2018, on acquiring a remaining minority stake in D&D in Italy, Igartza food service in Spain and Punjab Kitchen, rebranded as Food Solutions, in Britain.

“Our lower acquisition costs reflect fewer acquisitions in the year as management’s focus was on bedding down the various investments made in previous periods,” Group Chief Executive Bernard Berson said in the statement.

“We retain adequate headroom for further organic and acquisitive growth, and we are still well capitalised.”

Bidcorp, which was spun off from Bidvest and separately listed in 2016, posted headline earnings per share (HEPS) from continuing operations of 1,443.6 cents in the year to June 30, up from 1,282.9 cents a year earlier.

In constant currency terms, HEPS rose 7.7%. HEPS is the main profit gauge in South Africa and strips out certain one-off items.

The group, which supplies hotels, restaurants and industrial caterers, said revenue rose 9.8% to 129.3 billion rand ($8.49 billion), supported by a positive trading performance in its developed markets.

Its shares were up 4.22% at 315 rand at 0936 GMT.

“Trading in most of our geographies remained positive despite persistent low food inflation and moderate economic growth. Our good revenue growth and better gross margins helped offset cost pressures, particularly labour, energy and fuel,” Berson said.

In Europe, the Eastern Europe business showed record revenue growth but has experienced wage pressures.

($1 = 15.2369 rand)

Kenya's Nation Media Group says H1 2019 pretax profit falls 24%

NAIROBI (Reuters) - Kenya’s Nation Media Group said its pretax profit fell to 580.8 million shillings ($5.6 million) in the first half of 2019 from 761.8 million shillings in the same period a year earlier, on lower revenue.

The biggest news publisher in East Africa, with newspapers, radio and television stations in Kenya as well as Uganda, Rwanda and Tanzania, said overall turnover fell to 4.58 billion shillings in the six months to end June from 4.93 billion shillings in first half of 2018, due to falling advertising revenues.

($1 = 103.2000 Kenyan shillings)

Namibia’s central bank forecasts deeper economic contraction in 2019

WINDHOEK (Reuters) - The Bank of Namibia said on Tuesday it expected the domestic economy to fall into a deeper contraction of 1.7% during 2019, down from its initial estimate of 0.3% positive growth in April.

The central bank said the economy was expected to recover to positive growth of 0.8% and 1.2% in 2020 and 2021, respectively.

The projected 1.7% contraction of 1.7% for 2019 represents a further deterioration from a mild contraction of 0.1% in 2018, according to preliminary estimates by the Namibia Statistics Agency.

The bank said the expected deeper contraction during 2019 would be in line with a devastating drought now afflicting Namibia as well as anticipated contractions in major sectors such as diamond mining and wholesale and retail trade.

A likely reduced contraction in the construction sector would ease the drag on overall growth when compared to the last two years, but its impact will be offset by weaknesses in other sectors during 2019, it said.

Risks to the domestic economic outlook include the persistently low uranium price and unpredictable rainfall.

Low uranium prices continue to adversely impact the prospects for uranium mining in Namibia, while erratic rainfall may continue to crimp agricultural output beyond 2019.

“Furthermore, the China-U.S. trade tensions may negatively affect the demand for Namibian minerals and products,” the central bank said in a statement.

The bank recently cut its benchmark interest rate for the first time in two years as part of efforts to boost the economy, which has already suffered two years of negative growth, a first since independence from South Africa in 1990.

Trade war drives ‘innocent’ Asian nations towards recession

Rising fears about the health of the global economy have prompted talk of recession, spreading anxiety about jobs and growth.

The US-China trade war is casting a shadow over the world economy and warning signs of a looming downturn have flashed on financial markets.

Recession poses no immediate threat to the biggest economies in Asia, although they are slowing down. Yet some smaller countries in the region - including Hong Kong and Singapore - are definitely at risk.

They are what Louis Kuijs, head of Asia economics at Oxford Economics, calls the "innocent bystanders" in the trade fight between Washington and Beijing.

"These are small, open economies, where trade - and trade with China - is extremely important," says Mr Kuijs.

Here's a look at what's driving the slowdown in Asia's top economies, as well as the countries at risk of recession:

China

Growth in the world's second-largest economy has been for easing for years. The latest figures show China's gross domestic product (GDP) grew 6.2% in the second quarter, its slowest pace since the early 1990s.

The trade war that has seen Washington impose tariffs on billions of dollars' worth of Chinese goods is adding more strain.

It has hurt some Chinese firms, with roughly 20% of the country's exports sent to the US. But perhaps more harmful to businesses is the lack of clarity over when the long-running dispute will end.

"The one thing that is affecting business plans is the uncertainty of the US-China trade war, probably more important than the tariffs," says Mr Kuijs.

"The uncertainty is a major factor of [the concerns] we see globally."

Beijing has taken a series of steps this year to support the economy, including tax cuts and infrastructure spending. For 2019, the government is targeting growth of between 6% and 6.5%.

Japan

Mr Kuijs points out that what happens to China matters a lot to the rest of Asia.

The slowdown there and the trade war have knocked business confidence in Japan, a country also grappling with softer global demand for its exports, such as electronic equipment and car parts.

A quick guide to the US-China trade war

But its latest economic figures were fairly upbeat. Preliminary data showed GDP increased 0.4% in the second quarter - beating an expected 0.1% rise - thanks to strong consumer spending.

Still, the world's third-largest economy faces a threat to spending when a long-awaited sales tax increase is introduced in October.

"Conditions probably won't remain as healthy as they are now, as domestic demand is set to weaken after the tax hike," Capital Economics Japan economist Marcel Thieliant says.

India

Over in Asia's third-largest economy, growth has faltered amid sluggish demand at home and weak investment. India's latest quarterly GDP growth dropped to a five-year low of 5.8%. The next GDP reading, due 30 August, could be weaker still.

The country has relied on domestic consumption to spur its huge economy, but spending has slowed sharply.

Car sales are one troubling example. In July, passenger vehicle sales plunged 31%, the steepest monthly fall in nearly two decades. The sector has slashed jobs and cut production as sales dry up.

India announces retaliatory US tariffs

India no longer world's fastest-growing economy

So far this year, India's central bank has cut rates four times. The benchmark rate currently sits at a near-decade low.

More stimulus measures to boost the economy, which is also battling the threat of a widening trade conflict with the US, are expected this year.

Hong Kong

The Asian financial hub is fighting the pressures of a slowdown in China, the trade war and political unrest. Some economists expect that combination to push the territory into recession before long.

Gross domestic product shrank 0.4% in the three months to June compared with the previous quarter.

But those figures did not capture the impact of the pro-democracy protests that have gripped Hong Kong for more than two months, hitting tourism and retail sales.

Hong Kong protests in 300 words

Economists at DBS and Capital Economics are among those expecting that third-quarter numbers, due out in November, will show Hong Kong has fallen into a technical recession, defined as two consecutive quarters of negative growth.

Singapore

The trade-dependent city state has been hit by weak global demand, slowing growth in China and the trade war.

Singapore is reliant on high-tech exports - and softer demand for electronics around the world has darkened its economic outlook.

The economy shrank by 3.3% in the second quarter, on a seasonally adjusted annualised basis. That prompted the government to cut its growth forecasts for 2019 to between 0% and 1%.

Oxford Economics expects that third-quarter GDP numbers, due in October, will show a contraction, meaning that Singapore will enter a technical recession.

Trade war infects Asia as exports plunge

Mr Kuijs says the impact of the trade war on Hong Kong and Singapore is "larger than in China itself, even though no one is imposing any tariffs on these countries".

South Korea

Concerns swirled earlier this year that South Korea could slip into recession. But it managed to avoid that outcome after huge government spending helped the economy swing back to growth in the second quarter.

Gross domestic product grew 1.1% in the three months to June compared with the previous quarter, when South Korea posted its sharpest contraction since the global financial crisis. In July, the country's central bank cut rates for the first time in three years.

Much of the pain has been caused by faltering tech exports, driven by the global electronics slowdown. That trade is crucial to South Korea, since electronics account for around 30% of the country's exports. A simmering trade battle with Japan is adding more uncertainty to South Korea's growth prospects.--BBC

Thomas Cook to sell majority stake to China's Fosun

Troubled travel firm Thomas Cook says it has agreed a rescue deal with investor Fosun Tourism, its banks and a majority of its bondholders.

The UK tour operator said in July it was working to secure new investment from Fosun, a major shareholder.

The new deal would see the Chinese group take control of the business at the expense of other shareholders.

Fosun will put in £450m in return for at least 75% of the tour business and 25% of the group's airline.

Profit warnings

Thomas Cook's lending banks and bondholders will contribute a further £450m for 75% of the airline and up to 25% of the tour operator business,

The plan will result in a significant dilution in existing shareholders' interests, the company said, but that it had decided it was the best way to secure the future of the group for all its stakeholders.

"It means the oldest brand in travel will continue to deliver good-value travel," said Simon Calder, travel editor at the Independent. "A lot of uncertainty that people have, including staff, will be settled by this deal.

"But it begs the question - is Thomas Cook going to be able to differentiate itself sufficiently and be able to deliver exciting experiences and good value?"

Fosun is already Thomas Cook's largest shareholder. It also owns the Club Med holiday business and Wolverhampton Wanderers Football Club.

What's gone wrong at Thomas Cook?

This summer, Thomas Cook reported a £1.5bn half-year loss.

The firm - which was founded in Market Harborough in 1841 to run temperance day trips - has annual sales of £9bn, 19 million customers a year and 22,000 staff operating in 16 countries.

The travel firm has issued three profit warnings in a year and is struggling to reduce its debts.

Thomas Cook has also been trying for a long time to sell its airline business.

Temperance trips

The firm has had a chequered history, including being nationalised in 1948 - when it became part of the state-owned British Railways - and owning the raucous Club 18-30 youth brand, which it recently closed after failing to find a buyer.

However, just as the travel world has progressed from temperance day trips, so the modern business and leisure market is also changing, and at a far faster pace than in previous decades.

The firm is being buffeted by a number of factors: financial, social and even meteorological, with last summer's heatwave affecting bookings.

As well as weather issues, and stiff competition from online travel agents and low-cost airlines, there are other disruptive factors, including political unrest around the world.

In addition, many holidaymakers are now putting together their own holidays and not using travel agents.--BBC

Apple 'sorry' that workers listened to Siri voice recordings

Apple has apologised following revelations that it paid third-party workers to listen to voice recordings of Siri users.

The practice known as "grading" has been used by several tech firms as a way of improving the quality of speech recognition.

However, Apple, Google and Microsoft all halted such work recently, following public outcry.

Apple said it plans to resume grading - but only for Siri users who opt in.

The firm added that in the future only its own employees will be able to access recordings, not third-party workers at contracted firms.

Earlier this month, the company said it had halted grading following reports that workers had heard recordings containing intimate remarks made by Siri users.

Such recordings can be made accidentally, for example when the Siri app interprets another word or noise as the utterance "Hey Siri", which is used to launch voice recognition.

Apple and Google stop workers playing back voice recordings

Amazon Alexa: Watchdog in discussions over recordings

Now, Apple says it has completed a review of such work.

"As a result of our review, we realise we haven't been fully living up to our high ideals, and for that we apologise," the firm said in a statement.

Up until grading was halted, 0.2% of Siri audio recordings was reviewed by human workers, Apple added.

The company said that three main changes would take place before human grading of Siri recordings was resumed. It said:

audio recordings would no longer be retained by default. Instead, Apple employees would rely on computer-generated transcripts of speech

Siri users would be able to opt in to share audio recordings - and would be able to opt out "at any time"

only Apple employees would have access to recordings, and any recordings that had been made "inadvertently" would be deleted

The turnaround was an unusual move from Apple, said Adam Wright, a tech analyst at market research firm IDC.

"I think they've been caught off-guard a little bit," he told the BBC. "I don't think they've been completely forthcoming or transparent in their use of data."

Part of the controversy over using humans to grade voice recordings was that Siri users may not always have been aware that their conversations could be listened to in this way.

The Irish data protection authority, Apple's lead data privacy regulator in Europe, had previously said it was looking into the matter of grading.

A spokeswoman for the commission said it had noted Apple's latest statement.--BBC

US still to grant any Huawei trade licences

US officials have not granted any licences to trade with blacklisted Chinese firm Huawei, despite receiving more than 130 requests, Reuters says.

The US restricted companies from selling to the electronics giant in May, citing national security concerns, which have been dismissed by Huawei.

President Donald Trump said last month that some exemptions would be allowed.

A spokesman for the commerce department insisted that requests concerning Huawei were "ongoing".

One industry source suggested to the BBC that a lack of clear guidelines from the Trump administration is to blame for the current standstill.

William Reinsch, a former US commerce department official, claims that officials are "afraid" to make a decision.

"Nobody in the executive branch knows what Trump wants and they're all afraid to make a decision without knowing that," he told Reuters.

A spokesman for the commerce department insisted that requests concerning Huawei were "ongoing".

The US recently added a further 45 businesses associated with Huawei to an export blacklist.

It is the latest in a string of mixed signals from the president, who said this week that crucial trade talks with China would resume "very shortly".

His surprise announcement came after the the US revealed that it would be adding trade tariffs to $550bn (£449bn) worth of Chinese imports.

Asian stocks drop as US-China trade war escalates

A quick guide to the US-China trade war

Huawei is the world's second-largest smartphone marker behind Samsung Electronics, but it has so far failed to make a dent in the US, where it currently holds less than a 1% market share.

The company has laid off more than 600 of its US staff since it was blacklisted by the US.

The US Department of Justice has claimed that its close ties with the Chinese government open it up to the the risk of its equipment being used to spy on other countries.

Huawei's future in the UK is also up for debate, with an announcement revealing whether it should be excluded from the rollout of 5G mobile networks by the end of the year.

Digital Secretary Nicky Morgan told the BBC that she hoped the government "could do something by the autumn".--BBC

Costco forced to shut first China store early due to crowds

US retailer Costco was forced to close early on its opening day in China, after the store was swamped with shoppers.

Buyers battled long queues and traffic chaos, before the Shanghai store was shut hours early due to "overcrowding".

Costco's push into China comes as other foreign retailers have struggled to compete with local rivals.

It also comes at a time of rising tensions between the US and China over trade.

Costco is a discount warehouse store that sells a range of goods, from fresh foods to household electronics.

Some customers spent two hours lining up to pay for their purchases, while some had to wait three hours for parking, state news agency Xinhua reported.

One video showed people pushing through heavy crowds to get their hands on roast chickens.

"Due to overcrowding in the market, and in order to provide you with a better shopping experience, Costco will temporarily close on the afternoon of August 27. Please avoid coming," the retailer in a notice on its official app, according to AFP.

Costco has had an online presence in China since 2014, through a partnership with e-commerce giant Alibaba.

The firm's first store in the country comes as other international retailers battle tough competition in China.

Earlier this year, Amazon said it was downsizing its operations in China and France's Carrefour agreed to sell 80% of its China business to local retailer Suning.com after a series of losses.

Tesco has struggled to crack the Chinese market.

Costco's China move also comes at a difficult time for US-China relations.

Amazon plans to shut online store in China

US-China trade war in 300 words

The world's two largest economies have been fighting a trade war for the past year, and tensions have escalated with the threat of more tariffs from both sides.--BBC

Pound volatile as Parliament to be suspended in September

The pound was volatile on Wednesday following news that Parliament is to be suspended just days after MPs return to work on 3 September.

The move is expected to prevent opposition leaders from passing a law to stop a no-deal Brexit.

The pound is down about 0.5% against both the euro and US dollar. So £1 is now worth €1.10 and $1.22.

The FTSE 100, made up of stocks that could benefit from a devaluation of sterling, ended 0.4% ahead to 7,114.71.

Many of those listed firms book much of their earnings in foreign currencies, and benefit from a weak pound.

The FTSE 250, a stock index that is seen as more representative of the UK economy, closed down 0.7% to 19,202.99.

Firms that are exposed to the domestic economy such as house builders and airlines were hit: Taylor Wimpey, Persimmon and Barratt Developments were down between 2% and 2.3%.

Meanwhile, British Airways owner IAG fell 1.7% and easyJet dropped 3.2%.

Why is the pound is getting weaker?

Government asks Queen to suspend Parliament

"As far as the markets are concerned, there's a fair bit of bad news already baked in to the pound," according to David Cheetham, an analyst at currency trader XTB Online Trading.

"It is telling that after the knee-jerk move lower in recent trade, the selling we've seen is far from panic stations."

Discussing the prime minister's decision to suspend parliament, Mr Cheetham said: "This seems like a pre-emptive strike from [Mr Johnson] against those seeking to block a no-deal Brexit and once more it seems that the opposition are in danger of fluffing a big opportunity to have an impact.

"If the government is successful in this, then a no-deal Brexit wouldn't be taken off the table until the 11th hour at the earliest and this keeps a significant downside risk to the pound in play."

'Ongoing battle'

And Michael Hewson, chief markets analyst at CMC, said: "Sterling is under pressure as a consequence of the prospect of a no-deal Brexit increasing, while the FTSE 100 has jumped higher.

"Overall, though, this appears part and parcel of the ongoing battle between the various caucuses of MPs who want to block a no-deal Brexit at all costs, and those who want to retain the option as part of the ongoing attempts to renegotiate the withdrawal agreement."

The government has asked the Queen to suspend Parliament just days after MPs return to work in September - and only a few weeks before the Brexit deadline.

Boris Johnson said a Queen's Speech would take place after the suspension, on 14 October, to outline his "very exciting agenda".

But it means MPs are unlikely to have time to pass laws to stop a no-deal Brexit on 31 October.--BBC

INVESTORS DIARY 2019

Company

Event

Venue

Date & Time

Companies under Cautionary

Bindura Nickel Corporation

Padenga Holdings

Delta Corporation

Meikles Limited

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